Registration Nos. 33-56217
811-07231
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 X
Pre-Effective Amendment No. 2 X
Post-Effective Amendment No.
and
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY
ACT OF 1940 X
Amendment No.
(Check appropriate box or boxes)
PRAIRIE FUNDS
(Exact Name of Registrant as Specified in Charter)
c/o The First National Bank of Chicago
Three First National Plaza
Chicago, Illinois 60670 60670
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, including Area Code: (312)
732-4231
Bradford M. Markham, Esq.
Three First National Plaza
Chicago, Illinois 60670
(Name and Address of Agent for Service)
copy to:
Lewis G. Cole, Esq.
Stroock & Stroock & Lavan
7 Hanover Square
New York, New York 10004-2696
Approximate Date of Proposed Public Offering: As soon as
practicable after
this Registration Statement is declared effective.
PART C. OTHER INFORMATION
Item 24. Financial Statements and Exhibits
(a) Financial Statements:
(1) Statement of Assets and Liabilities as of
_________, 1994*
(2) Report of Ernst & Young LLP, Independent
Auditors, dated _________, 1994*
(b) Exhibits:
(1) Amended and Restated Agreement and
Declaration of Trust
(2) By-Laws
(5) (a) Investment Advisory Agreement
(b) Sub-Investment Advisory Agreement
(6) Distribution Agreement
(8) Custody Agreement
(9) (a) Administration Agreement
(9) (b) Master Sub-Administration Agreement
(9) (c) Shareholder Services Plan
(10) Opinion (including consent) of
Stroock & Stroock & Lavan*
(11) Consent of Independent Auditors*
(15) Distribution Plan
Other Exhibit:
Secretary's Certificate*
* To be filed by amendment.
Item 25. Persons Controlled by or Under Common Control with
Registrant
Not applicable.
Item 26. Number of Holders of Securities
(1) (2)
Number of Record
Title of Class Holders
Shares of beneficial interest,
par value $.001 per share
Managed Assets Fund ____
Managed Assets Income Fund ____
Equity Income Fund ____
Growth Fund ____
International Equity Fund ____
Special Opportunities Fund ____
International Bond Fund ____
Bond Fund ____
Intermediate Municipal Bond Fund ____
U.S. Government Money Market Fund ____
Money Market Fund ____
Municipal Money Market Fund ____
Item 27. Indemnification
Reference is made to Article EIGHTH of the Registrant's
Declaration of Trust filed as Exhibit 1 hereto. The application
of these provisions is limited by Article 10 of the Registrant's
By-Laws filed as Exhibit 2 hereto and by the following
undertaking set forth in the rules promulgated by the Securities
and Exchange Commission:
Insofar as indemnification for liabilities
arising under the Securities Act of 1933 may
be permitted to trustees, officers and
controlling persons of the registrant pursuant
to the foregoing provisions, or otherwise, the
registrant has been advised that in the
opinion of the Securities and Exchange Commis-
sion such indemnification is against public
policy as expressed in such Act and is,
therefore, unenforceable. In the event that a
claim for indemnification against such
liabilities (other than the payment by the
registrant of expenses incurred or paid by a
trustee, officer or controlling person of the
registrant in the successful defense of any
action, suit or proceeding) is asserted by
such trustee, officer or controlling person in
connection with the securities being
registered, the registrant will, unless in the
opinion of its counsel the matter has been
settled by controlling precedent, submit to a
court of appropriate jurisdiction the question
whether such indemnification by it is against
public policy as expressed in such Act and
will be governed by the final adjudication of
such issue.
Reference also is made to the Distribution Agreement
filed as Exhibit 6 hereto.
Item 28. Business and Other Connections of Investment Adviser
(a) Investment Adviser
Registrant is fulfilling the requirement of this
Item 28 to provide a list of the officers and directors of First
Chicago Investment Management Company (the "Investment
Adviser"), together with information as to any other business,
profession, vocation or employment of a substantial nature
engaged in by the Investment Adviser or those of its officers
and directors during the past two years, by incorporating by
reference the information contained in the Form ADV filed with
the SEC pursuant to the Investment Advisers Act of 1940 by the
Investment Adviser (SEC File No. 801-_____).
(b) Sub-Investment Adviser
Registrant is fulfilling the requirement of this
Item 28 to provide a list of the officers and directors of ANB
Investment Management and Trust Company (the "Sub-Adviser"),
together with information as to any other business, profession,
vocation or employment of a substantial nature engaged in by the
Sub-Adviser or those of its officers and directors during the
past two years, by incorporating by reference the information
contained in the Form ADV filed with the SEC pursuant to the
Investment Advisers Act of 1940 by the Sub-Adviser (SEC File
No. 801-_____).
Item 29. Principal Underwriters
(a) Other investment companies for which Registrant's
principal underwriter (exclusive distributor) acts as principal
underwriter or exclusive distributor:
The Infinity Mutual Funds, Inc.
Emerald Funds, Inc.
Pacific Horizon Funds, Inc.
(b) The information required by this Item 29(b)
regarding each director or officer of Concord Financial Group,
Inc. is incorporated by reference to Schedule A of Form BD filed
by Concord Financial Group, Inc. pursuant to the Securities
Exchange Act of 1934 (SEC File No. 8-37601).
Item 30. Location of Accounts and Records
1. First Chicago Investment Management Company
Three First National Plaza
Chicago, Illinois 60670
2. Concord Financial Group, Inc.
125 West 55th Street
11th Floor
New York, New York 10019
Item 31. Management Services
Not Applicable
Item 32. Undertakings
Registrant hereby undertakes
(1) to file a post-effective amendment, using
financial statements which need not be certified,
within four to six months from the effective date
of Registrant's 1933 Act Registration Statement.
(2) to call a meeting of shareholders for the purpose
of voting upon the question of removal of a
trustee or trustees when requested in writing to
do so by the holders of at least 10% of the
Registrant's outstanding shares of beneficial
interest and in connection with such meeting to
comply with the provisions of Section 16(c) of
the Investment Company Act of 1940 relating to
shareholder communications.
SIGNATURES
Pursuant to the requirements of the Securities Act of
1933 and the Investment Company Act of 1940, the Registrant has
duly caused this Amendment to the Registration Statement to be
signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Chicago, and State of Illinois on the
28th day of November, 1994.
PRAIRIE FUNDS
BY: /s/Joseph F. Kissel*
Joseph F. Kissel, President
Pursuant to the requirements of the Securities Act of
1933 and the Investment Company Act of 1940, this Amendment to
the
Registration Statement has been signed below by the following
persons in the capacities and on the dates indicated.
Signatures Title Date
/s/Joseph F. Kissel* President (Principal November 28, 1994
Joseph F. Kissel Executive Officer)
/s/ Richard A. Fabietti* Treasurer (Principal November 28, 1994
Richard A. Fabietti Financial and
Accounting Officer)
/s/John P. Gould* Trustee November 28, 1994
John P. Gould
/s/Marilyn McCoy* Trustee November 28, 1994
Marilyn McCoy
/s/Raymond D. Oddi* Trustee November 28, 1994
Raymond D. Oddi
By: /s/James W. Bernaiche November 28, 1994
James W. Bernaiche,
Attorney-in-Fact
PRAIRIE FUNDS
Pre-Effective Amendment No. 1 to
Registration Statement on Form N-1A under
the Securities Act of 1933 and
the Investment Company Act of 1940
EXHIBITS
<PAGE>
INDEX TO EXHIBITS
Page
(1) Amended and Restated Agreement
and Declaration of Trust . . . . . . . . .
(2) By-laws. . . . . . . . . . . . . . . . . . .
(5)(a) Investment Advisory Agreement. . . . . . . .
(b) Sub-Investment Advisory Agreement. . . . . .
(6) Distribution Agreement . . . . . . . . . . .
(8) Custody Agreement. . . . . . . . . . . . . .
(9)(a) Administration Agreement . . . . . . . . . .
(9)(b) Master Sub-Administration Agreement. . . . .
(9)(c) Shareholder Services Plan. . . . . . . . . .
(15) Distribution Plan . . . . . . . . . . . . . .
<PAGE>
EXHIBIT 1
PRAIRIE FUNDS
(formerly, SSL-1994-3)
Amended and Restated Agreement and Declaration of Trust
THIS AMENDED AND RESTATED AGREEMENT AND DECLARATION OF
TRUST, made this 21st day of October, 1994, hereby amends and
restates in its entirety the Agreement and Declaration of Trust
made at Boston, Massachusetts, dated October 19, 1994, by the
Trustee hereunder (hereinafter with any additional and successor
trustees referred to as the "Trustees") and by the holders of
shares of beneficial interest to be issued hereunder as
hereinafter provided.
W I T N E S S E T H :
WHEREAS, the Trustees have agreed to manage all
property coming into their hands as trustees of a Massachusetts
business trust in accordance with the provisions hereinafter set
forth.
NOW, THEREFORE, the Trustees hereby declare that they
will hold all cash, securities and other assets, which they may
from time to time acquire in any manner as Trustees hereunder IN
TRUST to manage and dispose of the same upon the following terms
and conditions for the pro rata benefit of the holders from time
to time of Shares, whether or not certificated, in this Trust as
hereinafter set forth.
ARTICLE I
Name and Definitions
Section 1. Name. This Trust shall be known as
"Prairie Funds."
Section 2. Definitions. Whenever used herein, unless
otherwise required by the context or specifically provided:
(a) The term "Commission" shall have the meaning
provided in the 1940 Act;
(b) The "Trust" refers to the Massachusetts business
trust established by this Agreement and Declaration of Trust, as
amended from time to time;
(c) "Shareholder" means a record owner of Shares of
the Trust;
(d) "Shares" means the equal proportionate
transferable units of interest into which the beneficial interest
in the Trust shall be divided from time to time or, if more than
one series or class of Shares is authorized by the Trustees, the
equal proportionate transferable units into which each series or
class of Shares shall be divided from time to time, and includes
a fraction of a Share as well as a whole Share;
(e) The "1940 Act" refers to the Investment Company
Act of 1940, and the Rules and Regulations thereunder, all as
amended from time to time;
(f) The term "Manager" is defined in Article IV, Sec-
tion 5;
(g) The term "Person" shall mean an individual or any
corporation, partnership, joint venture, trust or other
enterprise;
(h) "Declaration of Trust" shall mean this Agreement
and Declaration of Trust as amended or restated from time to
time;
(i) "Bylaws" shall mean the Bylaws of the Trust as
amended from time to time;
(j) The term "series" or "series of Shares" refers to
the one or more separate investment portfolios of the Trust into
which the assets and liabilities of the Trust may be divided and
the Shares of the Trust representing the beneficial interest of
Shareholders in such respective portfolios; and
(k) The term "class" or "class of Shares" refers to
the division of Shares representing any series into two or more
classes as provided in Article III, Section 1 hereof.
ARTICLE II
Purposes of Trust
This Trust is formed for the following purpose or
purposes:
(a) to conduct, operate and carry on the business of
an investment company;
(b) to subscribe for, invest in, reinvest in, purchase
or otherwise acquire, hold, pledge, sell, assign, transfer, lend,
write options on, exchange, distribute or otherwise dispose of
and deal in and with securities of every nature, kind, character,
type and form, including, without limitation of the generality of
the foregoing, all types of stocks, shares, futures contracts,
bonds, debentures, notes, bills and other negotiable or non-
negotiable instruments, obligations, evidences of interest,
certificates of interest, certificates of participation,
certificates, interests, evidences of ownership, guarantees,
warrants, options or evidences of indebtedness issued or created
by or guaranteed as to principal and interest by any state or
local government or any agency or instrumentality thereof, by the
United States Government or any agency, instrumentality,
territory, district or possession thereof, by any foreign
government or any agency, instrumentality, territory, district or
possession thereof, by any corporation organized under the laws
of any state, the United States or any territory or possession
thereof or under the laws of any foreign country, bank
certificates of deposit, bank time deposits, bankers' acceptances
and commercial paper; to pay for the same in cash or by the issue
of stock, including treasury stock, bonds or notes of the Trust
or otherwise; and to exercise any and all rights, powers and
privileges of ownership or interest in respect of any and all
such investments of every kind and description, including,
without limitation, the right to consent and otherwise act with
respect thereto, with power to designate one or more persons,
firms, associations or corporations to exercise any of said
rights, powers and privileges in respect of any said instruments;
(c) to borrow money or otherwise obtain credit and to
secure the same by mortgaging, pledging or otherwise subjecting
as security the assets of the Trust;
(d) to issue, sell, repurchase, redeem, retire,
cancel, acquire, hold, resell, reissue, dispose of, transfer, and
otherwise deal in, Shares including Shares in fractional
denominations, and to apply to any such repurchase, redemption,
retirement, cancellation or acquisition of Shares any funds or
other assets of the appropriate series or class of Shares,
whether capital or surplus or otherwise, to the full extent now
or hereafter permitted by the laws of The Commonwealth of
Massachusetts;
(e) to conduct its business, promote its purposes, and
carry on its operations in any and all of its branches and
maintain offices both within and without The Commonwealth of
Massachusetts, in any and all States of the United States of
America, in the District of Columbia, and in any other parts of
the world; and
(f) to do all and everything necessary, suitable,
convenient, or proper for the conduct, promotion, and attainment
of any of the businesses and purposes herein specified or which
at any time may be incidental thereto or may appear conducive to
or expedient for the accomplishment of any of such businesses and
purposes and which might be engaged in or carried on by a Trust
organized under the Massachusetts General Laws, and to have and
exercise all of the powers conferred by the laws of The Common-
wealth of Massachusetts upon a Massachusetts business trust.
The foregoing provisions of this Article II shall be
construed both as purposes and powers and each as an independent
purpose and power.
ARTICLE III
Beneficial Interest
Section 1. Shares of Beneficial Interest. The Shares
of the Trust shall be issued in one or more series as the
Trustees may, without Shareholder approval, authorize. Each
series shall be preferred over all other series in respect of the
assets allocated to that series and shall represent a separate
investment portfolio of the Trust. The beneficial interest in
each series at all times shall be divided into Shares, with or
without par value as the Trustees may from time to time
determine, each of which shall, except as provided in the
following sentence, represent an equal proportionate interest in
the series with each other Share of the same series, none having
priority or preference over another. The Trustees may, without
Shareholder approval, divide Shares of any series into two or
more classes, Shares of each such class having such preferences
and special or relative rights and privileges (including
conversion rights, if any) as the Trustees may determine. The
number of Shares authorized shall be unlimited, and the Shares so
authorized may be represented in part by fractional shares. From
time to time, the Trustees may divide or combine the Shares of
any series or class into a greater or lesser number without
thereby changing the proportionate beneficial interests in the
series or class.
Section 2. Ownership of Shares. The ownership of
Shares will be recorded in the books of the Trust or a transfer
agent. The record books of the Trust or any transfer agent, as
the case may be, shall be conclusive as to who are the holders of
Shares of each series and class and as to the number of Shares of
each series and class held from time to time by each. No
certificates certifying the ownership of Shares need be issued
except as the Trustees may otherwise determine from time to time.
Section 3. Issuance of Shares. The Trustees are
authorized, from time to time, to issue or authorize the issuance
of Shares at not less than the par value thereof, if any, and to
fix the price or the minimum price or the consideration (in cash
and/or such other property, real or personal, tangible or
intangible, as from time to time they may determine) or minimum
consideration for such Shares. Anything herein to the contrary
notwithstanding, the Trustees may issue Shares pro rata to the
Shareholders of a series at any time as a stock dividend, except
to the extent otherwise required or permitted by the preferences
and special or relative rights and privileges of any classes of
Shares of that series, and any stock dividend to the Shareholders
of a particular class of Shares shall be made to such
Shareholders pro rata in proportion to the number of Shares of
such class held by each of them.
All consideration received by the Trust for the issue
or sale of Shares of each series, together with all income,
earnings, profits, and proceeds thereof, including any proceeds
derived from the sale, exchange or liquidation thereof, and any
funds or payments derived from any reinvestment of such proceeds
in whatever form the same may be, shall belong irrevocably to the
series of Shares with respect to which the same were received by
the Trust for all purposes, subject only to the rights of
creditors, and shall be so handled upon the books of account of
the Trust and are herein referred to as "assets of" such series.
Shares may be issued in fractional denominations to the
same extent as whole Shares, and Shares in fractional
denominations shall be Shares having proportionately to the
respective fractions represented thereby all the rights of whole
Shares, including, without limitation, the right to vote, the
right to receive dividends and distributions, and the right to
participate upon liquidation of the Trust or of a particular
series of Shares.
Section 4. No Preemptive Rights; Derivative Suits.
Shareholders shall have no preemptive or other right to subscribe
for any additional Shares or other securities issued by the
Trust. No action may be brought by a Shareholder on behalf of
the Trust or a series unless a prior demand regarding such matter
has been made on the Trustees and the Shareholders of the Trust
or such series.
Section 5. Status of Shares and Limitation of Personal
Liability. Shares shall be deemed to be personal property giving
only the rights provided in this instrument. Every Shareholder
by virtue of having become a Shareholder shall be held to have
expressly assented and agreed to the terms hereof and to have
become a party hereto. The death of a Shareholder during the
continuance of the Trust shall not operate to terminate the same
nor entitle the representative of any deceased Shareholder to an
accounting or to take any action in court or elsewhere against
the Trust or the Trustees, but only to the rights of said
decedent under this Trust. Ownership of Shares shall not entitle
the Shareholder to any title in or to the whole or any part of
the Trust property or right to call for a partition or division
of the same or for an accounting, nor shall the ownership of
Shares constitute the Shareholders partners. Neither the Trust
nor the Trustees, nor any officer, employee or agent of the Trust
shall have any power to bind any Shareholder or Trustee
personally or to call upon any Shareholder for the payment of any
sum of money or assessment whatsoever other than such as the
Shareholder at any time personally may agree to pay by way of
subscription for any Shares or otherwise. Every note, bond,
contract or other undertaking issued by or on behalf of the Trust
shall include a recitation limiting the obligation represented
thereby to the Trust and its assets or the assets of a particular
series (but the omission of such a recitation shall not operate
to bind any Shareholder or Trustee personally).
ARTICLE IV
Trustees
Section 1. Election. A Trustee may be elected either
by the Trustees or the Shareholders. The Trustees named herein
shall serve until the first meeting of the Shareholders or until
the election and qualification of their successors. Prior to the
first meeting of Shareholders the initial Trustees hereunder may
elect additional Trustees to serve until such meeting and until
their successors are elected and qualified. The Trustees also at
any time may elect Trustees to fill vacancies in the number of
Trustees. The number of Trustees shall be fixed from time to
time by the Trustees and, at or after the commencement of the
business of the Trust, shall be not less than three. Each
Trustee, whether referred to hereinafter or hereafter becoming a
Trustee, shall serve as a Trustee during the lifetime of this
Trust, until such Trustee dies, resigns, retires, or is removed,
or, if sooner, until the next meeting of Shareholders called for
the purpose of electing Trustees and the election and
qualification of his successor. Subject to Section 16(a) of the
1940 Act, the Trustees may elect their own successors and,
pursuant to this Section, may appoint Trustees to fill vacancies.
Section 2. Powers. The Trustees shall have all powers
necessary or desirable to carry out the purposes of the Trust,
including, without limitation, the powers referred to in Article
II hereof. Without limiting the generality of the foregoing, the
Trustees may adopt By-Laws not inconsistent with this Declaration
of Trust providing for the conduct of the business of the Trust
and may amend and repeal them to the extent that they do not
reserve that right to the Shareholders; they may fill vacancies
in their number, including vacancies resulting from increases in
their own number, and may elect and remove such officers and
employ, appoint and terminate such employees or agents as they
consider appropriate; they may appoint from their own number and
terminate any one or more committees; they may employ one or more
custodians of the assets of the Trust and may authorize such
custodians to employ subcustodians and to deposit all or any part
of such assets in a system or systems for the central handling of
securities, retain a transfer agent and a Shareholder servicing
agent, or both, provide for the distribution of Shares through a
principal underwriter or otherwise, set record dates, and in
general delegate such authority as they consider desirable
(including, without limitation, the authority to purchase and
sell securities and to invest funds, to determine the net income
of the Trust for any period, the value of the total assets of the
Trust and the net asset value of each Share, and to execute such
deeds, agreements or other instruments either in the name of the
Trust or the names of the Trustees or as their attorney or
attorneys or otherwise as the Trustees from time to time may deem
expedient) to any officer of the Trust, committee of the
Trustees, any such employee, agent, custodian or underwriter or
to any Manager.
Without limiting the generality of the foregoing, the
Trustees shall have full power and authority:
(a) To invest and reinvest cash and to hold cash
uninvested;
(b) To vote or give assent, or exercise any rights of
ownership, with respect to stock or other securities or property;
and to execute and deliver proxies or powers of attorney to such
person or persons as the Trustees shall deem proper, granting to
such person or persons such power and discretion with relation to
securities or property as the Trustees shall deem proper;
(c) To hold any security or property in a form not
indicating any trust whether in bearer, unregistered or other
negotiable form or in the name of the Trust or a custodian,
subcustodian or other depository or a nominee or nominees or
otherwise;
(d) To consent to or participate in any plan for the
reorganization, consolidation or merger of any corporation or
concern, any security of which is held in the Trust; to consent
to any contract, lease, mortgage, purchase or sale of property by
such corporation or concern, and to pay calls or subscriptions
with respect to any security held in the Trust;
(e) To join with other security holders in acting
through a committee, depositary, voting trustee or otherwise, and
in that connection to deposit any security with, or transfer any
security to, any such committee, depositary or trustee, and to
delegate to them such power and authority with relation to any
security (whether or not so deposited or transferred) as the
Trustees shall deem proper, and to agree to pay, and to pay, such
portion of the expenses and compensation of such committee,
depositary or trustee as the Trustees shall deem proper;
(f) To compromise, arbitrate, or otherwise adjust
claims in favor of or against the Trust or any matter in
controversy, including, but not limited to, claims for taxes;
(g) Subject to the provisions of Article III, Section
3, to allocate assets, liabilities, income and expenses of the
Trust to a particular series of Shares or to apportion the same
among two or more series, provided that any liabilities or
expenses incurred by a particular series of Shares shall be
payable solely out of the assets of that series; and to the
extent necessary or appropriate to give effect to the preferences
and special or relative rights and privileges of any classes of
Shares, to allocate assets, liabilities, income and expenses of a
series to a particular class of Shares of that series or to
apportion the same among two or more classes of Shares of that
series;
(h) To enter into joint ventures, general or limited
partnerships and any other combinations or associations;
(i) To purchase and pay for entirely out of Trust
property such insurance as they may deem necessary or appropriate
for the conduct of the business, including, without limitation,
insurance policies insuring the assets of the Trust and payment
of distributions and principal on its portfolio investments, and
insurance policies insuring the Shareholders, Trustees, officers,
employees, agents, investment advisers or Managers, principal
underwriters, or independent contractors of the Trust
individually against all claims and liabilities of every nature
arising by reason of holding, being or having held any such
office or position, or by reason of any action alleged to have
been taken or omitted by any such person as Shareholder, Trustee,
officer, employee, agent, investment adviser or Manager,
principal underwriter, or independent contractor, including any
action taken or omitted that may be determined to constitute
negligence, whether or not the Trust would have the power to
indemnify such person against such liability; and
(j) To pay pensions for faithful service, as deemed
appropriate by the Trustees, and to adopt, establish and carry
out pension, profit-sharing, share bonus, share purchase,
savings, thrift and other retirement, incentive and benefit
plans, trusts and provisions, including the purchasing of life
insurance and annuity contracts as a means of providing such
retirement and other benefits, for any or all of the Trustees,
officers, employees and agents of the Trust.
Further, without limiting the generality of the
foregoing, the Trustees shall have full power and authority to
incur and pay out of the principal or income of the Trust such
expenses and liabilities as may be deemed by the Trustees to be
necessary or proper for the purposes of the Trust; provided,
however, that all expenses and liabilities incurred by or arising
in connection with a particular series of Shares, as determined
by the Trustees, shall be payable solely out of the assets of
that series.
Any determination made in good faith and, so far as
accounting matters are involved, in accordance with generally
accepted accounting principles by or pursuant to the authority
granted by the Trustees, as to the amount of the assets, debts,
obligations or liabilities of the Trust or a particular series or
class of Shares; the amount of any reserves or charges set up and
the propriety thereof; the time of or purpose for creating such
reserves or charges; the use, alteration or cancellation of any
reserves or charges (whether or not any debt, obligation or
liability for which such reserves or charges shall have been
created shall have been paid or discharged or shall be then or
thereafter required to be paid or discharged); the price or
closing bid or asked price of any investment owned or held by the
Trust or a particular series; the market value of any investment
or fair value of any other asset of the Trust or a particular
series; the number of Shares outstanding; the estimated expense
to the Trust or a particular series in connection with purchases
of its Shares; the ability to liquidate investments in an orderly
fashion; and the extent to which it is practicable to deliver a
cross-section of the portfolio of the Trust or a particular
series in payment for any such Shares, or as to any other matters
relating to the issue, sale, purchase and/or other acquisition or
disposition of investments or Shares of the Trust or a particular
series, shall be final and conclusive, and shall be binding upon
the Trust or such series and its Shareholders, past, present and
future, and Shares are issued and sold on the condition and
understanding that any and all such determinations shall be
binding as aforesaid.
Section 3. Meetings. At any meeting of the Trustees,
a majority of the Trustees then in office shall constitute a
quorum. Any meeting may be adjourned from time to time by a
majority of the votes cast upon the question, whether or not a
quorum is present, and the meeting may be held as adjourned
without further notice.
When a quorum is present at any meeting, a majority of
the Trustees present may take any action, except when a larger
vote is required by this Declaration of Trust, the By-Laws or the
1940 Act.
Any action required or permitted to be taken at any
meeting of the Trustees or of any committee thereof may be taken
without a meeting, if a written consent to such action is signed
by a majority of the Trustees or members of any such committee
then in office, as the case may be, and such written consent is
filed with the minutes of proceedings of the Trustees or any such
committee.
The Trustees or any committee designated by the
Trustees may participate in a meeting of the Trustees or such
committee by means of a conference telephone or similar
communications equipment by means of which all persons
participating in the meeting can hear each other at the same
time. Participation by such means shall constitute presence in
person at a meeting.
Section 4. Ownership of Assets of the Trust. Title to
all of the assets of each series of Shares of the Trust at all
times shall be considered as vested in the Trustees.
Section 5. Investment Advice and Management Services.
The Trustees shall not in any way be bound or limited by any
present or future law or custom in regard to investments by
trustees. The Trustees from time to time may enter into a
written contract or contracts with any person or persons (herein
called the "Manager"), including any firm, corporation, trust or
association in which any Trustee or Shareholder may be
interested, to act as investment advisers and/or managers of the
Trust and to provide such investment advice and/or management as
the Trustees from time to time may consider necessary for the
proper management of the assets of the Trust, including, without
limitation, authority to determine from time to time what
investments shall be purchased, held, sold or exchanged and what
portion, if any, of the assets of the Trust shall be held
uninvested and to make changes in the Trust's investments. Any
such contract shall be subject to the requirements of the 1940
Act with respect to its continuance in effect, its termination
and the method of authorization and approval of such contract, or
any amendment thereto or renewal thereof.
Any Trustee or any organization with which any Trustee
may be associated also may act as broker for the Trust in making
purchases and sales of securities for or to the Trust for its
investment portfolio, and may charge and receive from the Trust
the usual and customary commission for such service. Any
organization with which a Trustee may be associated in acting as
broker for the Trust shall be responsible only for the proper
execution of transactions in accordance with the instructions of
the Trust and shall be subject to no further liability of any
sort whatever.
The Manager, or any affiliate thereof, also may be a
distributor for the sale of Shares by separate contract or may be
a person controlled by or affiliated with any Trustee or any
distributor or a person in which any Trustee or any distributor
is interested financially, subject only to applicable provisions
of law. Nothing herein contained shall operate to prevent any
Manager, who also acts as such a distributor, from also receiving
compensation for services rendered as such distributor.
Section 6. Removal and Resignation of Trustees. The
Trustees or the Shareholders (by vote of 66-2/3% of the
outstanding Shares entitled to vote thereon) may remove at any
time any Trustee with or without cause, and any Trustee may
resign at any time as Trustee, without penalty by written notice
to the Trust; provided that sixty days' advance written notice
shall be given in the event that there are only three or fewer
Trustees at the time a notice of resignation is submitted.
ARTICLE V
Shareholders' Voting Powers and Meetings
Section 1. Voting Powers. The Shareholders shall have
power to vote only (i) for the election of Trustees as provided
in Article IV, Section 1, of this Declaration of Trust; provided,
however, that no meeting of Shareholders is required to be called
for the purpose of electing Trustees unless and until such time
as less than a majority of the Trustees have been elected by the
Shareholders, (ii) for the removal of Trustees as provided in
Article IV, Section 6, (iii) with respect to any Manager as pro-
vided in Article IV, Section 5, (iv) with respect to any
amendment of this Declaration of Trust as provided in Article IX,
Section 8, (v) with respect to the termination of the Trust or a
series of Shares as provided in Article IX, Section 5, and (vi)
with respect to such additional matters relating to the Trust as
may be required by law, by this Declaration of Trust, or the By-
Laws of the Trust or any registration of the Trust with the
Commission or any state, or as the Trustees may consider
desirable. Each whole Share shall be entitled to one vote as to
any matter on which it is entitled to vote (except that in the
election of Trustees said vote may be cast for as many persons as
there are Trustees to be elected), and each fractional Share
shall be entitled to a proportionate fractional vote.
Notwithstanding any other provision of this Declaration of Trust,
on any matter submitted to a vote of Shareholders, all Shares of
the Trust then entitled to vote shall be voted in the aggregate
as a single class without regard to series or classes of Shares,
except (i) when required by the 1940 Act or when the Trustees
shall have determined that the matter affects one or more series
or classes differently Shares shall be voted by individual series
or class and (ii) when the Trustees have determined that the
matter affects only the interests of one or more series or
classes then only Shareholders of such series or classes shall be
entitled to vote thereon. There shall be no cumulative voting in
the election of Trustees. Shares may be voted in person or by
proxy. A proxy with respect to Shares held in the name of two or
more persons shall be valid if executed by any one of them,
unless at or prior to exercise of the proxy the Trust receives a
specific written notice to the contrary from any one of them. A
proxy purporting to be executed by or on behalf of a Shareholder
shall be deemed valid unless challenged at or prior to its
exercise and the burden of proving invalidity shall rest on the
challenger. Whenever no Shares of any series or class are issued
and outstanding, the Trustees may exercise with respect to such
series or class all rights of Shareholders and may take any
action required by law, this Declaration of Trust or any By-Laws
of the Trust to be taken by Shareholders.
Section 2. Meetings. Meetings of the Shareholders may
be called by the Trustees or such other person or persons as may
be specified in the By-Laws and shall be called by the Trustees
upon the written request of Shareholders owning at least 30% of
the outstanding Shares entitled to vote. Shareholders shall be
entitled to at least ten days' prior notice of any meeting.
Section 3. Quorum and Required Vote. Thirty percent
(30%) of the outstanding Shares shall be a quorum for the
transaction of business at a Shareholders' meeting, except that
where any provision of law or of this Declaration of Trust
permits or requires that holders of any series or class shall
vote as a series or class, then thirty percent (30%) of the
aggregate number of Shares of that series or class entitled to
vote shall be necessary to constitute a quorum for the
transaction of business by that series or class. Any lesser
number, however, shall be sufficient for adjournment and any
adjourned session or sessions may be held within 90 days after
the date set for the original meeting without the necessity of
further notice. Except when a larger vote is required by any
provision of this Declaration of Trust or the By-Laws of the
Trust and subject to any applicable requirements of law, a
majority of the Shares voted shall decide any question and a
plurality shall elect a Trustee, provided that where any
provision of law or of this Declaration of Trust permits or
requires that the holders of any series or class shall vote as a
series or class, then a majority of the Shares of that series or
class voted on the matter (or a plurality with respect to the
election of a Trustee) shall decide that matter insofar as that
series or class is concerned.
Section 4. Action by Written Consent. Any action
required or permitted to be taken at any meeting may be taken
without a meeting if a consent in writing, setting forth such
action, is signed by a majority of Shareholders entitled to vote
on the subject matter thereof (or such larger proportion thereof
as shall be required by any express provision of this Declaration
of Trust) and such consent is filed with the records of the
Trust.
Section 5. Additional Provisions. The By-Laws may
include further provisions for Shareholders' votes and meetings
and related matters.
ARTICLE VI
Distributions and Redemptions
Section 1. Distributions. The Trustees shall
distribute periodically to the Shareholders of each series of
Shares an amount approximately equal to the net income of that
series, determined by the Trustees or as they may authorize and
as herein provided. Distributions of income may be made in one
or more payments, which shall be in Shares, cash or otherwise,
and on a date or dates and as of a record date or dates
determined by the Trustees. At any time and from time to time in
their discretion, the Trustees also may cause to be distributed
to the Shareholders of any one or more series as of a record date
or dates determined by the Trustees, in Shares, cash or
otherwise, all or part of any gains realized on the sale or
disposition of the assets of the series or all or part of any
other principal of the Trust attributable to the series. Each
distribution pursuant to this Section 1 shall be made ratably
according to the number of Shares of the series held by the
several Shareholders on the record date for such distribution,
except to the extent otherwise required or permitted by the
preferences and special or relative rights and privileges of any
classes of Shares of that series, and any distribution to the
Shareholders of a particular class of Shares shall be made to
such Shareholders pro rata in proportion to the number of Shares
of such class held by each of them. No distribution need be made
on Shares purchased pursuant to orders received, or for which
payment is made, after such time or times as the Trustees may
determine.
Section 2. Determination of Net Income. In
determining the net income of each series or class of Shares for
any period, there shall be deducted from income for that period
(a) such portion of all charges, taxes, expenses and liabilities
due or accrued as the Trustees shall consider properly chargeable
and fairly applicable to income for that period or any earlier
period and (b) whatever reasonable reserves the Trustees shall
consider advisable for possible future charges, taxes, expenses
and liabilities which the Trustees shall consider properly
chargeable and fairly applicable to income for that period or any
earlier period. The net income of each series or class for any
period may be adjusted for amounts included on account of net
income in the net asset value of Shares issued or redeemed or
repurchased during that period. In determining the net income of
a series or class for a period ending on a date other than the
end of its fiscal year, income may be estimated as the Trustees
shall deem fair. Gains on the sale or disposition of assets
shall not be treated as income, and losses shall not be charged
against income unless appropriate under applicable accounting
principles, except in the exercise of the discretionary powers of
the Trustees. Any amount contributed to the Trust which is
received as income pursuant to a decree of any court of competent
jurisdiction shall be applied as required by the said decree.
Section 3. Redemptions. Any Shareholder shall be
entitled to require the Trust to redeem and the Trust shall be
obligated to redeem at the option of such Shareholder all or any
part of the Shares owned by said Shareholder, at the redemption
price, pursuant to the method, upon the terms and subject to the
conditions hereinafter set forth:
(a) Certificates for Shares, if issued, shall be
presented for redemption in proper form for transfer to the Trust
or the agent of the Trust appointed for such purpose, and these
shall be presented with a written request that the Trust redeem
all or any part of the Shares represented thereby.
(b) The redemption price per Share shall be the net
asset value per Share when next determined by the Trust at such
time or times as the Trustees shall designate, following the time
of presentation of certificates for Shares, if issued, and an
appropriate request for redemption, or such other time as the
Trustees may designate in accordance with any provision of the
1940 Act, or any rule or regulation made or adopted by any
securities association registered under the Securities Exchange
Act of 1934, as determined by the Trustees, less any applicable
charge or fee imposed from time to time as determined by the
Trustees.
(c) Net asset value of each series or class of Shares
(for the purpose of issuance of Shares as well as redemptions
thereof) shall be determined by dividing:
(i) the total value of the assets of such series
or class determined as provided in paragraph (d) below
less, to the extent determined by or pursuant to the
direction of the Trustees in accordance with generally
accepted accounting principles, all debts, obligations
and liabilities of such series or class (which debts,
obligations and liabilities shall include, without
limitation of the generality of the foregoing, any and
all debts, obligations, liabilities, or claims, of any
and every kind and nature, fixed, accrued and
otherwise, including the estimated accrued expenses of
management and supervision, administration and
distribution and any reserves or charges for any or all
of the foregoing, whether for taxes, expenses, or
otherwise, and the price of Shares redeemed but not
paid for) but excluding the Trust's liability upon its
Shares and its surplus, by
(ii) the total number of Shares of such series or
class outstanding.
The Trustees are empowered, in their absolute
discretion, to establish other methods for determining such net
asset value whenever such other methods are deemed by them to be
necessary to enable the Trust to comply with applicable law, or
are deemed by them to be desirable, provided they are not
inconsistent with any provision of the 1940 Act.
(d) In determining for the purposes of this Dec-
laration of Trust the total value of the assets of each series or
class of Shares at any time, investments and any other assets of
such series or class shall be valued in such manner as may be
determined from time to time by or pursuant to the order of the
Trustees.
(e) Payment of the redemption price by the Trust may
be made either in cash or in securities or other assets at the
time owned by the Trust or partly in cash and partly in
securities or other assets at the time owned by the Trust. The
value of any part of such payment to be made in securities or
other assets of the Trust shall be the value employed in
determining the redemption price. Payment of the redemption
price shall be made on or before the seventh day following the
day on which the Shares are properly presented for redemption
hereunder, except that delivery of any securities included in any
such payment shall be made as promptly as any necessary transfers
on the books of the issuers whose securities are to be delivered
may be made and, except as postponement of the date of payment
may be permissible under the 1940 Act.
Pursuant to resolution of the Trustees, the Trust may
deduct from the payment made for any Shares redeemed a
liquidating charge not in excess of an amount determined by the
Trustees from time to time.
(f) The right of any holder of Shares redeemed by the
Trust as provided in this Article VI to receive dividends or
distributions thereon and all other rights of such Shareholder
with respect to such Shares shall terminate at the time as of
which the redemption price of such Shares is determined, except
the right of such Shareholder to receive (i) the redemption price
of such Shares from the Trust in accordance with the provisions
hereof, and (ii) any dividend or distribution to which such
Shareholder previously had become entitled as the record holder
of such Shares on the record date for such dividend or
distribution.
(g) Redemption of Shares by the Trust is conditional
upon the Trust having funds or other assets legally available
therefor.
(h) The Trust, either directly or through an agent,
may repurchase its Shares, out of funds legally available
therefor, upon such terms and conditions and for such
consideration as the Trustees shall deem advisable, by agreement
with the owner at a price not exceeding the net asset value per
Share as determined by or pursuant to the order of the Trustees
at such time or times as the Trustees shall designate, less any
applicable charge, if and as fixed by the Trustees from time to
time, and to take all other steps deemed necessary or advisable
in connection therewith.
(i) Shares purchased or redeemed by the Trust shall be
cancelled or held by the Trust for reissue, as the Trustees from
time to time may determine.
(j) The obligations set forth in this Article VI may
be suspended or postponed, (1) for any period (i) during which
the New York Stock Exchange is closed other than for customary
weekend and holiday closings, or (ii) during which trading on the
New York Stock Exchange is restricted, (2) for any period during
which an emergency exists as a result of which (i) the disposal
by the Trust of investments owned by it is not reasonably
practicable, or (ii) it is not reasonably practicable for the
Trust fairly to determine the value of its net assets, or (3) for
such other periods as the Commission or any successor
governmental authority by order may permit.
Notwithstanding any other provision of this Section 3
of Article VI, if certificates representing such Shares have been
issued, the redemption or repurchase price need not be paid by
the Trust until such certificates are presented in proper form
for transfer to the Trust or the agent of the Trust appointed for
such purpose; however, the redemption or repurchase shall be
effective, in accordance with the resolution of the Trustees,
regardless of whether or not such presentation has been made.
Section 4. Redemptions at the Option of the Trust.
The Trust shall have the right at its option and at any time to
redeem Shares of any Shareholder at the net asset value thereof
as determined in accordance with Section 3 of Article VI of this
Declaration of Trust: (i) if at such time such Shareholder owns
fewer Shares than, or Shares having an aggregate net asset value
of less than, an amount determined from time to time by the
Trustees; or (ii) to the extent that such Shareholder owns Shares
of a particular series or class of Shares equal to or in excess
of a percentage of the outstanding Shares of that series or class
determined from time to time by the Trustees; or (iii) to the
extent that such Shareholder owns Shares of the Trust
representing a percentage equal to or in excess of such
percentage of the aggregate number of outstanding Shares of the
Trust or the aggregate net asset value of the Trust determined
from time to time by the Trustees.
Section 5. Dividends, Distributions, Redemptions and
Repurchases. No dividend or distribution (including, without
limitation, any distribution paid upon termination of the Trust
or of any series) with respect to, nor any redemption or
repurchase of, the Shares of any series shall be effected by the
Trust other than from the assets of such series.
ARTICLE VII
Compensation and Limitation of
Liability of Trustees
Section 1. Compensation. The Trustees shall be
entitled to reasonable compensation from the Trust and may fix
the amount of their compensation.
Section 2. Limitation of Liability. The Trustees
shall not be responsible or liable in any event for any neglect
or wrongdoing of any officer, agent, employee or Manager of the
Trust, nor shall any Trustee be responsible for the act or
omission of any other Trustee, but nothing herein contained shall
protect any Trustee against any liability to which he would
otherwise be subject by reason of willful misfeasance, bad faith,
gross negligence or reckless disregard of the duties involved in
the conduct of his office.
Every note, bond, contract, instrument, certificate,
share, or undertaking and every other act or thing whatsoever
executed or done by or on behalf of the Trust or the Trustees or
any of them in connection with the Trust, shall be deemed
conclusively to have been executed or done only in their or his
capacity as Trustees or Trustee, and such Trustees or Trustee
shall not be personally liable thereon.
ARTICLE VIII
Indemnification
Section 1. Indemnification of Trustees, Officers,
Employees and Agents. Each person who is or was a Trustee,
officer, employee or agent of the Trust or who serves or has
served at the Trust's request as a director, officer or trustee
of another entity in which the Trust has or had any interest as a
shareholder, creditor or otherwise shall be entitled to
indemnification out of the assets of the Trust to the extent
provided in, and subject to the provisions of, the By-Laws,
provided that no indemnification shall be granted by the Trust in
contravention of the 1940 Act.
Section 2. Merged Corporations. For the purposes of
this Article VIII references to "the Trust" include any
constituent corporation (including any constituent of a
constituent) absorbed in a consolidation or merger which, if its
separate existence had continued, would have had power and
authority to indemnify its directors, officers, employees or
agents as well as the resulting or surviving entity; so that any
person who is or was a director, officer, employee or agent of
such a constituent corporation or is or was serving at the
request of such a constituent corporation as a trustee, director,
officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise shall stand in the same
position under the provisions of this Article VIII with respect
to the resulting or surviving entity as he would have with
respect to such a constituent corporation if its separate
existence had continued.
Section 3. Shareholders. In case any Shareholder or
former Shareholder shall be held to be personally liable solely
by reason of his being or having been a Shareholder and not
because of his acts or omissions or for some other reason, the
Shareholder or former Shareholder (or his heirs, executors,
administrators or other legal representatives or in the case of a
corporation or other entity, its corporate or other general
successor) shall be entitled out of the assets of the particular
series of Shares of which he is or was a Shareholder to be held
harmless from and indemnified against all losses and expenses
arising from such liability. Upon request, the Trust shall cause
its counsel to assume the defense of any claim which, if
successful, would result in an obligation of the Trust to
indemnify the Shareholder as aforesaid.
ARTICLE IX
Status of the Trust and Other General Provisions
Section 1. Trust Not a Partnership. It is hereby
expressly declared that a trust and not a partnership is created
hereby. Neither the Trust nor the Trustees, nor any officer,
employee or agent of the Trust shall have any power to bind
personally either the Trust's Trustees or officers or any Share-
holders. All persons extending credit to, contracting with or
having any claim against the Trust or a particular series of
Shares shall look only to the assets of the Trust or the assets
of that particular series for payment under such credit, contract
or claim; and neither the Shareholders nor the Trustees, nor any
of the Trust's officers, employees or agents, whether past,
present or future, shall be personally liable therefor. Nothing
in this Declaration of Trust shall protect any Trustee against
any liability to which such Trustee otherwise would be subject by
reason of willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of the
office of Trustee hereunder.
Section 2. Trustee's Good Faith Action, Expert Advice,
No Bond or Surety. The exercise by the Trustees of their powers
and discretion hereunder under the circumstances then prevailing,
shall be binding upon everyone interested. A Trustee shall be
liable for his or her own willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the
conduct of the office of Trustee, and for nothing else, and shall
not be liable for errors of judgment or mistakes of fact or law.
The Trustees may take advice of counsel or other experts with
respect to the meaning and operation of this Declaration of
Trust, and subject to the provisions of Section 1 of this Article
IX shall be under no liability for any act or omission in
accordance with such advice or for failing to follow such advice.
The Trustees shall not be required to give any bond as such, nor
any surety if a bond is required.
Section 3. Liability of Third Persons Dealing with
Trustees. No person dealing with the Trustees shall be bound to
make any inquiry concerning the validity of any transaction made
or to be made by the Trustees pursuant hereto or to see to the
application of any payments made or property transferred to the
Trust or upon its order.
Section 4. Trustees, Shareholders, etc. Not Personally
Liable; Notice. All persons extending credit to, contracting
with or having any claim against the Trust or a particular series
of Shares shall look only to the assets of the Trust or the
assets of that particular series of Shares for payment under such
credit, contract or claim; and neither the Shareholders nor the
Trustees, nor any of the Trust's officers, employees or agents,
whether past, present or future, shall be personally liable
therefor.
Section 5. Termination of Trust. Unless terminated as
provided herein, the Trust shall continue without limitation of
time. The Trust may be terminated at any time by vote of
Shareholders holding at least a majority of the Shares of each
series entitled to vote or by the Trustees by written notice to
the Shareholders. Any series of Shares may be terminated at any
time by vote of Shareholders holding at least a majority of the
Shares of such series entitled to vote or by the Trustees by
written notice to the Shareholders of such series.
Upon termination of the Trust or of any one or more
series of Shares, after paying or otherwise providing for all
charges, taxes, expenses and liabilities, whether due or accrued
or anticipated as may be determined by the Trustees, the Trust
shall reduce, in accordance with such procedures as the Trustees
consider appropriate, the remaining assets to distributable form
in cash or shares or other securities, or any combination
thereof, and distribute the proceeds to the Shareholders of the
series involved, ratably according to the number of Shares of
such series held by the several Shareholders of such series on
the date of termination, except to the extent otherwise required
or permitted by the preferences and special or relative rights
and privileges of any classes of Shares of that series, provided
that any distribution to the Shareholders of a particular class
of Shares shall be made to such Shareholders pro rata in
proportion to the number of Shares of such class held by each of
them.
Section 6. Filing of Copies, References, Headings.
The original or a copy of this instrument and of each amendment
hereto and of each Declaration of Trust supplemental hereto shall
be kept at the office of the Trust where it may be inspected by
any Shareholder. A copy of this instrument and of each such
amendment and supplemental Declaration of Trust shall be filed by
the Trust with the Secretary of State of The Commonwealth of
Massachusetts and the Boston City Clerk, as well as any other
governmental office where such filing may from time to time be
required. Anyone dealing with the Trust may rely on a
certificate by an officer of the Trust as to whether or not any
such amendments or supplemental Declarations of Trust have been
made and as to matters in connection with the Trust hereunder;
and, with the same effect as if it were the original, may rely on
a copy certified by an officer of the Trust to be a copy of this
instrument or of any such amendment or supplemental Declaration
of Trust. In this instrument or in any such amendment or
supplemental Declaration of Trust, references to this instrument,
and all expressions like "herein," "hereof," and "hereunder,"
shall be deemed to refer to this instrument as amended or
affected by any such amendment or supplemental Declaration of
Trust. Headings are placed herein for convenience of reference
only and in case of any conflict, the text of this instrument,
rather than the headings, shall control. This instrument may be
executed in any number of counterparts each of which shall be
deemed an original.
Section 7. Applicable Law. The Trust set forth in
this instrument is made in The Commonwealth of Massachusetts, and
it is created under and is to be governed by and construed and
administered according to the laws of said Commonwealth. The
Trust shall be of the type commonly called a Massachusetts
business trust, and without limiting the provisions hereof, the
Trust may exercise all powers which are ordinarily exercised by
such a trust.
Section 8. Amendments. This Declaration of Trust may
be amended at any time by an instrument in writing signed by a
majority of the then Trustees when authorized so to do by a vote
of Shareholders holding a majority of the Shares outstanding and
entitled to vote, except that an amendment which shall affect the
holders of one or more series or class of Shares but not the
holders of all outstanding series or classes of Shares shall be
authorized by vote of the Shareholders holding a majority of the
Shares entitled to vote of the series or classes affected and no
vote of Shareholders of a series or class not affected shall be
required. Amendments having the purpose of changing the name of
the Trust or of supplying any omission, curing any ambiguity or
curing, correcting or supplementing any defective or inconsistent
provision contained herein shall not require authorization by
Shareholder vote.
IN WITNESS WHEREOF, the undersigned Trustee has
hereunto set his hand and seal for himself and him assigns as of
the day and year first above written.
/s/David Stephens
David Stephens, Trustee
Address of Trust
c/o Stroock & Stroock & Lavan
7 Hanover Square
19th Floor
New York, New York 10004-2696
Address of Trustee
c/o Stroock & Stroock & Lavan
7 Hanover Square
19th Floor
New York, New York 10004-2696
<PAGE>
STATE OF NEW YORK )
: ss:
COUNTY OF NEW YORK )
Then personally appeared the above-named David Stephens
and acknowledged the foregoing instrument to be his free act and
deed, before me.
_______________________
Notary Public
<PAGE>
EXHIBIT 2
BY-LAWS
OF
PRAIRIE FUNDS
ARTICLE 1
Agreement and Declaration of Trust and Principal Office
1.1. Agreement and Declaration of Trust. These By-
Laws shall be subject to the Agreement and Declaration of Trust,
as from time to time in effect (the "Declaration of Trust"), of
the above-captioned Massachusetts business trust established by
the Declaration of Trust (the "Trust").
1.2. Principal Office of the Trust. The principal
office of the Trust shall be located in New York, New York. Its
resident agent in Massachusetts shall be CT Corporation System, 2
Oliver Street, Boston, Massachusetts, or such other person as the
Trustees from time to time may select.
ARTICLE 2
Meetings of Trustees
2.1. Regular Meetings. Regular meetings of the
Trustees may be held without call or notice at such places and at
such times as the Trustees from time to time may determine,
provided that notice of the first regular meeting following any
such determination shall be given to absent Trustees.
2.2. Special Meetings. Special meetings of the
Trustees may be held at any time and at any place designated in
the call of the meeting when called by the President or the
Treasurer or by two or more Trustees, sufficient notice thereof
being given to each Trustee by the Secretary or an Assistant
Secretary or by the officer or the Trustees calling the meeting.
2.3. Notice of Special Meetings. It shall be
sufficient notice to a Trustee of a special meeting to send
notice by mail at least forty-eight hours or by telegram at least
twenty-four hours before the meeting addressed to the Trustee at
his or her usual or last known business or residence address or
to give notice to him or her in person or by telephone at least
twenty-four hours before the meeting. Notice of a meeting need
not be given to any Trustee if a written waiver of notice,
executed by him or her before or after the meeting, is filed with
the records of the meeting, or to any Trustee who attends the
meeting without protesting prior thereto or at its commencement
the lack of notice to him or her. Neither notice of a meeting
nor a waiver of a notice need specify the purposes of the
meeting.
2.4. Notice of Certain Actions by Consent. If in
accordance with the provisions of the Declaration of Trust any
action is taken by the Trustees by a written consent of less than
all of the Trustees, then prompt notice of any such action shall
be furnished to each Trustee who did not execute such written
consent, provided that the effectiveness of such action shall not
be impaired by any delay or failure to furnish such notice.
ARTICLE 3
Officers
3.1. Enumeration; Qualification. The officers of the
Trust shall be a President, a Treasurer, a Secretary, and such
other officers, if any, as the Trustees from time to time may in
their discretion elect. The Trust also may have such agents as
the Trustees from time to time may in their discretion appoint.
Officers may be but need not be a Trustee or shareholder. Any
two or more offices may be held by the same person.
3.2. Election. The President, the Treasurer and the
Secretary shall be elected by the Trustees upon the occurrence of
any vacancy in any such office. Other officers, if any, may be
elected or appointed by the Trustees at any time. Vacancies in
any such other office may be filled at any time.
3.3. Tenure. The President, Treasurer and Secretary
shall hold office in each case until he or she sooner dies,
resigns, is removed or becomes disqualified. Each other officer
shall hold office and each agent shall retain authority at the
pleasure of the Trustees.
3.4. Powers. Subject to the other provisions of these
By-Laws, each officer shall have, in addition to the duties and
powers herein and in the Declaration of Trust set forth, such
duties and powers as commonly are incident to the office occupied
by him or her as if the Trust were organized as a Massachusetts
business corporation or such other duties and powers as the
Trustees may from time to time designate.
3.5. President. Unless the Trustees otherwise
provide, the President shall preside at all meetings of the
shareholders and of the Trustees. Unless the Trustees otherwise
provide, the President shall be the chief executive officer.
3.6. Treasurer. The Treasurer shall be the chief
financial and accounting officer of the Trust, and, subject to
the provisions of the Declaration of Trust and to any arrangement
made by the Trustees with a custodian, investment adviser or
manager, or transfer, shareholder servicing or similar agent,
shall be in charge of the valuable papers, books of account and
accounting records of the Trust, and shall have such other duties
and powers as may be designated from time to time by the Trustees
or by the President.
3.7. Secretary. The Secretary shall record all
proceedings of the shareholders and the Trustees in books to be
kept therefor, which books or a copy thereof shall be kept at the
principal office of the Trust. In the absence of the Secretary
from any meeting of the shareholders or Trustees, an Assistant
Secretary, or if there be none or if he or she is absent, a
temporary Secretary chosen at such meeting shall record the
proceedings thereof in the aforesaid books.
3.8. Resignations and Removals. Any Trustee or
officer may resign at any time by written instrument signed by
him or her and delivered to the President or Secretary or to a
meeting of the Trustees. Such resignation shall be effective
upon receipt unless specified to be effective at some other time.
The Trustees may remove any officer elected by them with or
without cause. Except to the extent expressly provided in a
written agreement with the Trust, no Trustee or officer resigning
and no officer removed shall have any right to any compensation
for any period following his or her resignation or removal, or
any right to damages on account of such removal.
ARTICLE 4
Committees
4.1. Appointment. The Trustees may appoint from their
number an executive committee and other committees. Except as
the Trustees otherwise may determine, any such committee may make
rules for conduct of its business.
4.2. Quorum; Voting. A majority of the members of any
Committee of the Trustees shall constitute a quorum for the
transaction of business, and any action of such a Committee may
be taken at a meeting by a vote of a majority of the members
present (a quorum being present).
ARTICLE 5
Reports
The Trustees and officers shall render reports at the
time and in the manner required by the Declaration of Trust or
any applicable law. Officers and Committees shall render such
additional reports as they may deem desirable or as may from time
to time be required by the Trustees.
ARTICLE 6
Fiscal Year
The fiscal year of the Trust shall be fixed, and shall
be subject to change, by the Board of Trustees.
ARTICLE 7
Seal
The seal of the Trust shall consist of a flat-faced die
with the word "Massachusetts," together with the name of the
Trust and the year of its organization cut or engraved thereon
but, unless otherwise required by the Trustees, the seal shall
not be necessary to be placed on, and in its absence shall not
impair the validity of, any document, instrument or other paper
executed and delivered by or on behalf of the Trust.
ARTICLE 8
Execution of Papers
Except as the Trustees generally or in particular cases
may authorize the execution thereof in some other manner, all
deeds, leases, contracts, notes and other obligations made by the
Trustees shall be signed by the President, any Vice President, or
by the Treasurer and need not bear the seal of the Trust.
ARTICLE 9
Issuance of Share Certificates
9.1. Sale of Shares. Except as otherwise determined
by the Trustees, the Trust will issue and sell for cash or
securities from time to time, full and fractional shares of its
shares of beneficial interest, such shares to be issued and sold
at a price of not less than net asset value per share as from
time to time determined in accordance with the Declaration of
Trust and these By-Laws and, in the case of fractional shares, at
a proportionate reduction in such price. In the case of shares
sold for securities, such securities shall be valued in
accordance with the provisions for determining value of assets of
the Trust as stated in the Declaration of Trust and these By-
Laws. The officers of the Trust are severally authorized to take
all such actions as may be necessary or desirable to carry out
this Section 9.1.
9.2. Share Certificates. In lieu of issuing
certificates for shares, the Trustees or the transfer agent
either may issue receipts therefor or may keep accounts upon the
books of the Trust for the record holders of such shares, who
shall in either case, for all purposes hereunder, be deemed to be
the holders of certificates for such shares as if they had
accepted such certificates and shall be held to have expressly
assented and agreed to the terms hereof.
The Trustees at any time may authorize the issuance of
share certificates. In that event, each shareholder shall be
entitled to a certificate stating the number of shares owned by
him, in such form as shall be prescribed from time to time by the
Trustees. Such certificate shall be signed by the President or
Vice President and by the Treasurer or Assistant Treasurer. Such
signatures may be facsimile if the certificate is signed by a
transfer agent, or by a registrar, other than a Trustee, officer
or employee of the Trust. In case any officer who has signed or
whose facsimile signature has been placed on such certificate
shall cease to be such officer before such certificate is issued,
it may be issued by the Trust with the same effect as if he or
she were such officer at the time of its issue.
9.3. Loss of Certificates. The Trust, or if any
transfer agent is appointed for the Trust, the transfer agent
with the approval of any two officers of the Trust, is authorized
to issue and countersign replacement certificates for the shares
of the Trust which have been lost, stolen or destroyed subject to
the deposit of a bond or other indemnity in such form and with
such security, if any, as the Trustees may require.
9.4. Discontinuance of Issuance of Certificates. The
Trustees at any time may discontinue the issuance of share
certificates and by written notice to each shareholder, may
require the surrender of share certificates to the Trust for
cancellation. Such surrender and cancellation shall not affect
the ownership of shares in the Trust.
ARTICLE 10
Indemnification
10.1. Trustees, Officers, etc. The Trust shall
indemnify each of its Trustees and officers (including persons
who serve at the Trust's request as directors, officers or
trustees of another organization in which the Trust has any
interest as a shareholder, creditor or otherwise) (hereinafter
referred to as a "Covered Person") against all liabilities and
expenses, including but not limited to amounts paid in
satisfaction of judgments, in compromise or as fines and
penalties, and counsel fees reasonably incurred by any Covered
Person in connection with the defense or disposition of any
action, suit or other proceeding, whether civil or criminal,
before any court or administrative or legislative body, in which
such Covered Person may be or may have been involved as a party
or otherwise or with which such person may be or may have been
threatened, while in office or thereafter, by reason of being or
having been such a Trustee or officer, except with respect to any
matter as to which such Covered Person shall have been finally
adjudicated in a decision on the merits in any such action, suit
or other proceeding not to have acted in good faith in the
reasonable belief that such Covered Person's action was in the
best interests of the Trust and except that no Covered Person
shall be indemnified against any liability to the Trust or its
Shareholders to which such Covered Person would otherwise be
subject by reason of wilful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the
conduct of such Covered Person's office. Expenses, including
counsel fees so incurred by any such Covered Person (but
excluding amounts paid in satisfaction of judgments, in
compromise or as fines or penalties), may be paid from time to
time by the Trust in advance of the final disposition or any such
action, suit or proceeding upon receipt of an undertaking by or
on behalf of such Covered Person to repay amounts so paid to the
Trust if it is ultimately determined that indemnification of such
expenses is not authorized under this Article, provided that (a)
such Covered Person shall provide security for his undertaking,
(b) the Trust shall be insured against losses arising by reason
of such Covered Person's failure to fulfill his undertaking, or
(c) a majority of the Trustees who are disinterested persons and
who are not Interested Persons (as that term is defined in the
Investment Company Act of 1940) (provided that a majority of such
Trustees then in office act on the matter), or independent legal
counsel in a written opinion, shall determine, based on a review
of readily available facts (but not a full trial-type inquiry),
that there is reason to believe such Covered Person ultimately
will be entitled to indemnification.
10.2. Compromise Payment. As to any matter disposed
of (whether by a compromise payment, pursuant to a consent decree
or otherwise) without an adjudication in a decision on the merits
by a court, or by any other body before which the proceeding was
brought, that such Covered Person either (a) did not act in good
faith in the reasonable belief that such Covered Person's action
was in the best interests of the Trust or (b) is liable to the
Trust or its Shareholders by reason of wilful misfeasance, bad
faith, gross negligence or reckless disregard of the duties
involved in the conduct of such Covered Person's office,
indemnification shall be provided if (a) approved as in the best
interest of the Trust, after notice that it involves such
indemnification, by at least a majority of the Trustees who are
disinterested persons and are not Interested Persons (provided
that a majority of such Trustees then in office act on the
matter), upon a determination, based upon a review of readily
available facts (but not a full trial-type inquiry) that such
Covered Person acted in good faith in the reasonable belief that
such Covered Person's action was in the best interests of the
Trust and is not liable to the Trust or its Shareholders by
reason of wilful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of such
Covered Person's office, or (b) there has been obtained an
opinion in writing of independent legal counsel, based upon a
review of readily available facts (but not a full trial-type
inquiry) to the effect that such Covered Person appears to have
acted in good faith in the reasonable belief that such Covered
Person's action was in the best interests of the Trust and that
such indemnification would not protect such Covered Person
against any liability to the Trust to which such Covered Person
would otherwise be subject by reason of wilful misfeasance, bad
faith, gross negligence or reckless disregard of the duties
involved in the conduct of his office. Any approval pursuant to
this Section shall not prevent the recovery from any Covered
Person of any amount paid to such Covered Person in accordance
with this Section as indemnification if such Covered Person is
subsequently adjudicated by a court of competent jurisdiction not
to have acted in good faith in the reasonable belief that such
Covered Person's action was in the best interests of the Trust or
to have been liable to the Trust or its shareholders by reason of
wilful misfeasance, bad faith, gross negligence or reckless
disregard of the duties involved in the conduct of such Covered
Person's office.
10.3. Indemnification Not Exclusive. The right of
indemnification hereby provided shall not be exclusive of or
affect any other rights to which any such Covered Person may be
entitled. As used in this Article 10, the term "Covered Person"
shall include such person's heirs, executors and administrators,
and a "disinterested person" is a person against whom none of the
actions, suits or other proceedings in question or another
action, suit, or other proceeding on the same or similar grounds
is then or has been pending. Nothing contained in this article
shall affect any rights to indemnification to which personnel of
the Trust, other than Trustees and officers, and other persons
may be entitled by contract or otherwise under law, nor the power
of the Trust to purchase and maintain liability insurance on
behalf of such person.
10.4. Limitation. Notwithstanding any provisions in
the Declaration of Trust and these By-Laws pertaining to
indemnification, all such provisions are limited by the following
undertaking set forth in the rules promulgated by the Securities
and Exchange Commission:
In the event that a claim for
indemnification is asserted by a Trustee,
officer or controlling person of the Trust in
connection with the registered securities of
the Trust, the Trust will not make such
indemnification unless (i) the Trust has
submitted, before a court or other body, the
question of whether the person to be
indemnified was liable by reason of wilful
misfeasance, bad faith, gross negligence, or
reckless disregard of duties, and has
obtained a final decision on the merits that
such person was not liable by reason of such
conduct or (ii) in the absence of such
decision, the Trust shall have obtained a
reasonable determination, based upon a review
of the facts, that such person was not liable
by virtue of such conduct, by (a) the vote of
a majority of Trustees who are neither
interested persons as such term is defined in
the Investment Company Act of 1940, nor
parties to the proceeding or (b) an
independent legal counsel in a written
opinion.
The Trust will not advance attorneys'
fees or other expenses incurred by the person
to be indemnified unless the Trust shall have
(i) received an undertaking by or on behalf
of such person to repay the advance unless it
is ultimately determined that such person is
entitled to indemnification and one of the
following conditions shall have occurred:
(x) such person shall provide security for
his undertaking, (y) the Trust shall be
insured against losses arising by reason of
any lawful advances or (z) a majority of the
disinterested, non-party Trustees of the
Trust, or an independent legal counsel in a
written opinion, shall have determined that
based on a review of readily available facts
there is reason to believe that such person
ultimately will be found entitled to
indemnification.
ARTICLE 11
Shareholders
11.1. Meetings. A meeting of the shareholders shall
be called by the Secretary whenever ordered by the Trustees, or
requested in writing by the holder or holders of at least 10% of
the outstanding shares entitled to vote at such meeting. If the
meeting is a meeting of the shareholders of one or more series or
class of shares, but not a meeting of all shareholders of the
Trust, then only the shareholders of such one or more series or
classes shall be entitled to notice of and to vote at the
meeting. If the Secretary, when so ordered or requested, refuses
or neglects for more than five days to call such meeting, the
Trustees, or the shareholders so requesting may, in the name of
the Secretary, call the meeting by giving notice thereof in the
manner required when notice is given by the Secretary.
11.2. Access to Shareholder List. Shareholders of
record may apply to the Trustees for assistance in communicating
with other shareholders for the purpose of calling a meeting in
order to vote upon the question of removal of a Trustee. When
ten or more shareholders of record who have been such for at
least six months preceding the date of application and who hold
in the aggregate shares having a net asset value of at least
$25,000 or at least 1% of the outstanding shares, whichever is
less, so apply, the Trustees shall within five business days
either:
(i) afford to such applicants access to a list of
names and addresses of all shareholders as recorded on the books
of the Trust; or
(ii) inform such applicants of the approximate
number of shareholders of record and the approximate cost of
mailing material to them and, within a reasonable time
thereafter, mail, materials submitted by the applicants, to all
such shareholders of record. The Trustees shall not be obligated
to mail materials which they believe to be misleading or in
violation of applicable law.
11.3. Record Dates. For the purpose of determining
the shareholders of any series or class who are entitled to vote
or act at any meeting or any adjournment thereof, or who are
entitled to receive payment of any dividend or of any other
distribution, the Trustees from time to time may fix a time,
which shall be not more than 90 days before the date of any
meeting of shareholders or the date of payment of any dividend or
of any other distribution, as the record date for determining the
shareholders of such series or class having the right to notice
of and to vote at such meeting and any adjournment thereof or the
right to receive such dividend or distribution, and in such case
only shareholders of record on such record date shall have such
right notwithstanding any transfer of shares on the books of the
Trust after the record date; or without fixing such record date
the Trustees may for any such purposes close the register or
transfer books for all or part of such period.
11.4. Place of Meetings. All meetings of the
shareholders shall be held at the principal office of the Trust
or at such other place within the United States as shall be
designated by the Trustees or the President of the Trust.
11.5. Notice of Meetings. A written notice of each
meeting of shareholders, stating the place, date and hour and the
purposes of the meeting, shall be given at least ten days before
the meeting to each shareholder entitled to vote thereat by
leaving such notice with him or at his residence or usual place
of business or by mailing it, postage prepaid, and addressed to
such shareholder at his address as it appears in the records of
the Trust. Such notice shall be given by the Secretary or an
Assistant Secretary or by an officer designated by the Trustees.
No notice of any meeting of shareholders need be given to a
shareholder if a written waiver of notice, executed before or
after the meeting by such shareholder or his attorney thereunto
duly authorized, is filed with the records of the meeting.
11.6. Ballots. No ballot shall be required for any
election unless requested by a shareholder present or represented
at the meeting and entitled to vote in the election.
11.7. Proxies. Shareholders entitled to vote may vote
either in person or by proxy in writing dated not more than six
months before the meeting named therein, which proxies shall be
filed with the Secretary or other person responsible to record
the proceedings of the meeting before being voted. Unless
otherwise specifically limited by their terms, such proxies shall
entitle the holders thereof to vote at any adjournment of such
meeting but shall not be valid after the final adjournment of
such meeting.
ARTICLE 12
Amendments to the By-Laws
These By-Laws may be amended or repealed, in whole or
in part, by a majority of the Trustees then in office at any
meeting of the Trustees, or by one or more writings signed by
such a majority.
Dated: October 21, 1994
<PAGE>
EXHIBIT 5(a)
INVESTMENT ADVISORY AGREEMENT
PRAIRIE FUNDS
125 West 55th Street
New York, New York 10019
November 18, 1994
First Chicago Investment
Management Company
Three First National Plaza
Chicago, Illinois 60670
Dear Sirs:
The above-named investment company (the "Fund")
consisting of the series named on Schedule 1 hereto, as such
Schedule may be revised from time to time (each, a "Series"),
herewith confirms its agreement with you as follows:
The Fund desires to employ its capital by investing and
reinvesting the same in investments of the type and in accordance
with the limitations specified in its charter documents and in
its Prospectus and Statement of Additional Information as from
time to time in effect, copies of which have been or will be
submitted to you, and in such manner and to such extent as from
time to time may be approved by the Fund's Board. The Fund
desires to employ you to act as its investment adviser.
In this connection it is understood that from time to
time you will employ or associate with yourself such person or
persons as you may believe to be particularly fitted to assist
you in the performance of this Agreement. Such person or persons
may be officers or employees who are employed by both you and the
Fund. The compensation of such person or persons shall be paid
by you and no obligation may be incurred on the Fund's behalf in
any such respect. We have discussed and concur in your employing
on this basis each sub-investment adviser indicated on Schedule 1
hereto (each, a "Sub-Investment Adviser") for the Series
indicated thereon, as such Schedule may be revised from time to
time.
Subject to the supervision and approval of the Fund's
Board, you will provide investment management of each Series'
portfolio in accordance with such Series' investment objectives
and policies as stated in the Fund's Prospectus and Statement of
Additional Information as from time to time in effect. In
connection therewith, you will obtain and provide investment
research and will supervise each Series' investments and conduct
a continuous program of investment, evaluation and, if
appropriate, sale and reinvestment of such Series' assets. You
will furnish to the Fund such statistical information, with
respect to the investments which a Series may hold or contemplate
purchasing, as the Fund may reasonably request. The Fund wishes
to be informed of important developments materially affecting any
Series' portfolio and shall expect you, on your own initiative,
to furnish to the Fund from time to time such information as you
may believe appropriate for this purpose.
You shall exercise your best judgment in rendering the
services to be provided to the Fund hereunder and the Fund agrees
as an inducement to your undertaking the same that neither you
nor a Sub-Investment Adviser shall be liable hereunder for any
error of judgment or mistake of law or for any loss suffered by
one or more Series, provided that nothing herein shall be deemed
to protect or purport to protect you or a Sub-Investment Adviser
against any liability to the Fund or a Series or to its security
holders to which you would otherwise be subject by reason of
willful misfeasance, bad faith or gross negligence in the
performance of your duties hereunder, or by reason of your
reckless disregard of your obligations and duties hereunder
(hereinafter "Disabling Conduct") or to which any Sub-Investment
Adviser would otherwise be subject by reason of Disabling
Conduct.
In consideration of services rendered pursuant to this
Agreement, the Fund will pay you on the first business day of
each month a fee at the rate set forth opposite each Series' name
on Schedule 1 hereto. Net asset value shall be computed on such
days and at such time or times as described in the Fund's then-
current Prospectus and Statement of Additional Information. The
fee for the period from the date of the commencement of the
public sale of a Series' shares to the end of the month during
which such sale shall have been commenced shall be pro-rated
according to the proportion which such period bears to the full
monthly period, and upon any termination of this Agreement before
the end of any month, the fee for such part of a month shall be
pro-rated according to the proportion which such period bears to
the full monthly period and shall be payable upon the date of
termination of this Agreement.
For the purpose of determining fees payable to you, the
value of each Series' net assets shall be computed in the manner
specified in the Fund's charter documents for the computation of
the value of each Series' net assets.
You will bear all expenses in connection with the
performance of your services under this Agreement and will pay
all fees of each Sub-Investment Adviser in connection with its
duties in respect of the relevant Series. All other expenses to
be incurred in the operation of the Fund will be borne by the
Fund, except to the extent specifically assumed by you. The
expenses to be borne by the Fund include, without limitation, the
following: organizational costs, taxes, interest, loan
commitment fees, interest and distributions paid on securities
sold short, brokerage fees and commissions, if any, fees of Board
members, Securities and Exchange Commission fees and state Blue
Sky qualification fees, advisory fees, charges of custodians,
transfer and dividend disbursing agents' fees, certain insurance
premiums, industry association fees, outside auditing and legal
expenses, costs of independent pricing services, costs of
maintaining the Series' existence, costs attributable to investor
services (including, without limitation, telephone and personnel
expenses), costs of preparing and printing prospectuses and
statements of additional information for regulatory purposes and
for distribution to existing stockholders, costs of stockholders'
reports and meetings, and any extraordinary expenses.
As to each Series, if in any fiscal year the aggregate
expenses of a Series (including fees pursuant to this Agreement,
but excluding interest, taxes, brokerage and, with the prior
written consent of the necessary state securities commissions,
extraordinary expenses) exceed the expense limitation of any
state having jurisdiction over such Series, the Fund may deduct
from the fees to be paid hereunder, or you will bear, such excess
expense to the extent required by state law. Your obligation
pursuant hereto will be limited to the amount of your fees here-
under. Such deduction or payment, if any, will be estimated
daily, and reconciled and effected or paid, as the case may be,
on a monthly basis.
The Fund understands that you now act, and that from
time to time hereafter you may act, as investment adviser to one
or more other investment companies and fiduciary or other managed
accounts, and the Fund has no objection to your so acting,
provided that when the purchase or sale of securities of the same
issuer is suitable for the investment objectives of two or more
companies or accounts managed by you which have available funds
for investment, the available securities will be allocated in a
manner believed by you to be equitable to each company or
account. It is recognized that in some cases this procedure may
adversely affect the price paid or received by one or more Series
or the size of the position obtainable for or disposed of by one
or more Series.
In addition, it is understood that the persons employed
by you to assist in the performance of your duties hereunder will
not devote their full time to such service and nothing contained
herein shall be deemed to limit or restrict your right or the
right of any of your affiliates to engage in and devote time and
attention to other businesses or to render services of whatever
kind or nature.
Neither you nor any Sub-Investment Adviser shall be
liable for any error of judgment or mistake of law or for any
loss suffered by the Fund in connection with the matters to which
this Agreement relates, except, in the case of you, for a loss
resulting from Disabling Conduct on your part and, in the case of
a Sub-Investment Adviser, for a loss resulting from Disabling
Conduct on its part. Any person, even though also your officer,
director, partner, employee or agent, who may be or become an
officer, Board member, employee or agent of the Fund, shall be
deemed, when rendering services to the Fund or acting on any
business of the Fund, to be rendering such services to or acting
solely for the Fund and not as your officer, director, partner,
employee or agent or one under your control or direction even
though paid by you.
As to each Series, this Agreement shall continue until
the date set forth opposite such Series' name on Schedule 1
hereto (the "Reapproval Date") and thereafter shall continue
automatically for successive annual periods ending on the day of
each year set forth opposite the Series' name on Schedule 1
hereto (the "Reapproval Day"), provided such continuance is
specifically approved at least annually by (i) the Fund's Board
or (ii) vote of a majority (as defined in the Investment Company
Act of 1940, as amended) of such Series' outstanding voting
securities, provided that in either event its continuance also is
approved by a majority of the Fund's Board members who are not
"interested persons" (as defined in said Act) of any party to
this Agreement, by vote cast in person at a meeting called for
the purpose of voting on such approval. As to each Series, this
Agreement is terminable without penalty, on 60 days' notice, by
the Fund's Board or by vote of holders of a majority of such
Series' shares or, upon not less than 90 days' notice, by you.
This Agreement also will terminate automatically, as to the
relevant Series, in the event of its assignment (as defined in
said Act).
The Fund is agreeing to the provisions of this
Agreement that limit a Sub-Investment Adviser's liability and
other provisions relating to the Sub-Investment Adviser so as to
induce the Sub-Investment Adviser to enter into its Sub-
Investment Advisory Agreement with you and to perform its
obligations thereunder. Each Sub-Investment Adviser is expressly
made a third party beneficiary of this Agreement with rights as
respects the Fund to the same extent as if it had been a party
hereto.
The Fund recognizes that from time to time your
directors, officers and employees may serve as directors,
trustees, partners, officers and employees of other corporations,
business trusts, partnerships or other entities (including other
investment companies) and that such other entities may include
the name "Prairie" as part of their name, and that your
corporation or its affiliates may enter into investment advisory
or other agreements with such other entities. If you cease to
act as the Fund's investment adviser, the Fund agrees that, at
your request, the Fund will take all necessary action to change
the name of the Fund to a name not including "Prairie" in any
form or combination of words.
This Agreement has been executed on behalf of the Fund
by the undersigned officer of the Fund in his capacity as an
officer of the Fund. The obligations of this Agreement shall
only be binding upon the assets and property of the Fund and
shall not be binding upon any Board member, officer or
shareholder of the Fund individually.
If the foregoing is in accordance with your
understanding, will you kindly so indicate by signing and
returning to us the enclosed copy hereof.
Very truly yours,
PRAIRIE FUNDS
By:__________________________
Accepted:
FIRST CHICAGO INVESTMENT
MANAGEMENT COMPANY
By:______________________________
<PAGE>
SCHEDULE 1
Annual Fee
as a
Percentage
of Average
Daily Net Reapproval Reapproval
Name of Series Assets Date Day
Bond Fund .55%
Equity Income Fund .50%
Growth Fund .65%
Intermediate Municipal
Bond Fund .40%
International Bond Fund .70%
International Equity
Fund<F1> .80%
Managed Assets Fund .65%
Managed Assets Income
Fund .65%
Money Market Fund .40%
Municipal Money Market
Fund .40%
Special Opportunities
Fund .70%
__________________
[FN] ANB Investment Management and Trust Company is the
Series'
Sub-Investment Adviser.
<PAGE>
EXHIBIT 5(b)
SUB-INVESTMENT ADVISORY AGREEMENT
FIRST CHICAGO INVESTMENT MANAGEMENT COMPANY
Three First National Plaza
Chicago, Illinois 60670
November 18, 1994
ANB Investment Management and
Trust Company
1 North LaSalle Street
Chicago, Illinois 60690
Dear Sirs:
As you are aware, each series of Prairie Funds (the
"Fund") desires to employ its capital by investing and
reinvesting the same in investments of the type and in accordance
with the limitations specified in its charter documents and in
its Prospectus and Statement of Additional Information as from
time to time in effect, copies of which have been or will be
submitted to you, and in such manner and to such extent as from
time to time may be approved by the Fund's Board. The Fund
intends to employ First Chicago Investment Management Company
(the "Adviser") to act as its investment adviser pursuant to a
written agreement (the "Investment Advisory Agreement"), a copy
of which has been furnished to you. The Adviser desires to
employ you to act as the sub-investment adviser to the
International Equity Fund (the "Series"), which is a series of
the Fund.
In this connection, it is understood that from time to
time you will employ or associate with yourself such person or
persons as you may believe to be particularly fitted to assist
you in the performance of this Agreement. Such person or persons
may be officers or employees who are employed by both you and the
Fund. The compensation of such person or persons shall be paid
by you and no obligation may be incurred on the Fund's behalf in
any such respect.
Subject to the supervision and approval of the
Adviser, you will provide investment management of the Series'
portfolio in accordance with the Series' investment objectives
and policies as stated in the Fund's Prospectus and Statement of
Additional Information as from time to time in effect. In
connection therewith, you will supervise the Series' investments
and conduct a continuous program of investment, evaluation and,
if appropriate, sale and reinvestment of the Series' assets. You
will furnish to the Adviser or the Fund such statistical
information, with respect to the investments which the Series may
hold or contemplate purchasing, as the Adviser or the Fund may
reasonably request. The Fund and the Adviser wish to be informed
of important developments materially affecting the Series'
portfolio and shall expect you, on your own initiative, to
furnish to the Fund or the Adviser from time to time such
information as you may believe appropriate for this purpose.
You shall exercise your best judgment in rendering the
services to be provided hereunder, and the Adviser agrees as an
inducement to your undertaking the same that you shall not be
liable hereunder for any error of judgment or mistake of law or
for any loss suffered by the Adviser, the Fund or the Series'
shareholders, as the case may be, provided that nothing herein
shall be deemed to protect or purport to protect you against any
liability to the Adviser, the Fund or the Series' shareholders to
which you would otherwise be subject by reason of willful
misfeasance, bad faith or gross negligence in the performance of
your duties hereunder, or by reason of your reckless disregard of
your obligations and duties hereunder.
In consideration of services rendered pursuant to this
Agreement, the Adviser will pay you, on the first business day of
each month, out of the investment advisory fee it receives with
respect to the Series and only to the extent thereof, a fee
calculated daily and paid monthly at the annual rate of .40 of 1%
of the Series' average daily net assets, for the preceding month.
Net asset value shall be computed on such days and at
such time or times as described in the Fund's then-current
Prospectus and Statement of Additional Information. The fee for
the period from the date following the commencement of sales of
the Series' shares to the end of the month during which such
sales shall have been commenced shall be pro-rated according to
the proportion which such period bears to the full monthly
period, and upon any termination of this Agreement before the end
of any month, the fee for such part of a month shall be pro-rated
according to the proportion which such period bears to the full
monthly period and shall be payable within 10 business days of
the date of termination of this Agreement.
For the purpose of determining fees payable to you,
the value of the Series' net assets shall be computed in the
manner specified in the Fund's charter documents for the
computation of net asset value.
You will bear all expenses in connection with the
performance of your services under this Agreement. All other
expenses to be incurred in the operation of the Fund (other than
those borne by the Adviser) will be borne by the Fund, except to
the extent specifically assumed by you. The expenses to be borne
by the Fund include, without limitation, the following:
organizational costs, taxes, interest, loan commitment fees,
interest and distributions paid on securities sold short,
brokerage fees and commissions, if any, fees of Board members,
Securities and Exchange Commission fees and state Blue Sky
qualification fees, advisory fees, charges of custodians,
transfer and dividend disbursing agents' fees, certain insurance
premiums, industry association fees, outside auditing and legal
expenses, costs of independent pricing services, costs of
maintaining the Series' existence, costs attributable to investor
services (including, without limitation, telephone and personnel
expenses), costs of preparing, printing and distributing
prospectuses and statements of additional information for
regulatory purposes and for distribution to existing
stockholders, costs of stockholders' reports and meetings, and
any extraordinary expenses.
If in any fiscal year the aggregate expenses of the
Fund (including fees with respect to the Series pursuant to the
Investment Advisory Agreement, but excluding interest, taxes,
brokerage and, with the prior written consent of the necessary
state securities commissions, extraordinary expenses) exceed the
expense limitation of any state having jurisdiction over the
Fund, the Adviser may deduct from the fees to be paid hereunder,
or you will bear such excess expense on a pro-rata basis with the
Adviser, in the proportion that the sub-advisory fee payable to
you pursuant to this Agreement bears to the investment advisory
fee with respect to the Series payable to the Adviser pursuant to
the Investment Advisory Agreement, to the extent required by
state law. Your obligation pursuant hereto will be limited to
the amount of your fees hereunder. Such deduction or payment, if
any, will be estimated daily, and reconciled and effected or
paid, as the case may be, on a monthly basis.
The Adviser understands that you now act, and that
from time to time hereafter you may act, as investment adviser to
one or more other investment companies and fiduciary or other
managed accounts, and the Adviser has no objection to your so
acting, provided that when purchase or sale of securities of the
same issuer is suitable for the investment objectives of two or
more companies or accounts managed by you which have available
funds for investment, the available securities will be allocated
in a manner believed by you to be equitable to each company or
account. It is recognized that in some cases this procedure may
adversely affect the price paid or received by the Series or the
size of the position obtainable for or disposed of by the Series.
In addition, it is understood that the persons
employed by you to assist in the performance of your duties
hereunder will not devote their full time to such services and
nothing contained herein shall be deemed to limit or restrict
your right or the right of any of your affiliates to engage in
and devote time and attention to other businesses or to render
services of whatever kind or nature.
You shall not be liable for any error of judgment or
mistake of law or for any loss suffered by the Adviser, the Fund
or the Series' shareholders, as the case may be, in connection
with the matters to which this Agreement relates, except for a
loss resulting from willful misfeasance, bad faith or gross
negligence on your part in the performance of your duties or from
reckless disregard by you of your obligations and duties under
this Agreement. Any person, even though also your officer,
director, partner, employee or agent, who may be or become an
officer, Board member, employee or agent of the Fund, shall be
deemed, when rendering services to the Fund or acting on any
business of the Fund, to be rendering such services to or acting
solely for the Fund and not as your officer, director, partner,
employee, or agent or one under your control or direction even
though paid by you.
This Agreement shall continue until _____ __, 199_,
and thereafter shall continue automatically for successive annual
periods ending on _____ of each year, provided such continuance
is specifically approved at least annually by (i) the Fund's
Board or (ii) vote of the holders of a majority (as defined in
the Investment Company Act of 1940, as amended) of the Series'
outstanding voting securities, provided that in either event its
continuance also is approved by a majority of the Fund's Board
members who are not "interested persons" (as defined in said Act)
of any party to this Agreement, by vote cast in person at a
meeting called for the purpose of voting on such approval. This
Agreement is terminable without penalty (i) by the Adviser upon
60 days' notice to you, (ii) by the Fund's Board or by vote of
the holders of a majority of the Series' outstanding voting
securities upon 60 days' notice to you, or (iii) by you upon not
less than 90 days' notice to the Fund and the Adviser. This
Agreement also will terminate automatically in the event of its
assignment (as defined in said Act). In addition,
notwithstanding anything herein to the contrary, if the
Investment Advisory Agreement terminates for any reason, this
Agreement shall terminate effective upon the date the Investment
Advisory Agreement terminates.
If the foregoing is in accordance with your
understanding, will you kindly so indicate by signing and
returning to us the enclosed copy hereof.
Very truly yours,
FIRST CHICAGO INVESTMENT
MANAGEMENT COMPANY
By:_________________________
Accepted:
ANB INVESTMENT MANAGEMENT
AND TRUST COMPANY
By:__________________________
<PAGE>
EXHIBIT 6
DISTRIBUTION AGREEMENT
PRAIRIE FUNDS
125 West 55th Street
New York, New York 10019
November 18, 1994
Concord Financial Group, Inc.
125 West 55th Street
11th Floor
New York, New York 10019
Dear Sirs:
This is to confirm that, in consideration of the agree-
ments hereinafter contained, the above-named investment company
(the "Fund") has agreed that you shall be, for the period of this
agreement, the distributor of (a) shares of each series of the
Fund set forth on Exhibit A hereto, as such Exhibit may be
revised from time to time (each, a "Series") or (b) if no Series
are set forth on such Exhibit, shares of the Fund. For purposes
of this agreement the term "Shares" shall mean the authorized
shares of the relevant Series, if any, and otherwise shall mean
the Fund's authorized shares.
1. Services as Distributor
1.1 You will act as agent for the distribution of
Shares covered by, and in accordance with, the registration
statement and prospectus then in effect under the Securities Act
of 1933, as amended, and will transmit promptly any orders
received by you for purchase or redemption of Shares to the
Transfer and Dividend Disbursing Agent for the Fund of which the
Fund has notified you in writing.
1.2 You agree to use your best efforts to solicit
orders for the sale of Shares. It is contemplated that you will
enter into sales or servicing agreements with securities dealers,
financial institutions and other industry professionals, such as
investment advisers, accountants and estate planning firms, and
in so doing you will act only on your own behalf as principal.
1.3 You shall act as distributor of Shares in
compliance with all applicable laws, rules and regulations,
including, without limitation, all rules and regulations made or
adopted pursuant to the Investment Company Act of 1940, as
amended, by the Securities and Exchange Commission or any
securities association registered under the Securities Exchange
Act of 1934, as amended.
1.4 Whenever in their judgment such action is
warranted by market, economic or political conditions, or by
abnormal circumstances of any kind, the Fund's officers may
decline to accept any orders for, or make any sales of, any
Shares until such time as they deem it advisable to accept such
orders and to make such sales and the Fund shall advise you
promptly of such determination.
1.5 The Fund agrees to pay all costs and expenses in
connection with the registration of Shares under the Securities
Act of 1933, as amended, and all expenses in connection with
maintaining facilities for the issue and transfer of Shares and
for supplying information, prices and other data to be furnished
by the Fund hereunder, and all expenses in connection with the
preparation and printing of the Fund's prospectuses and
statements of additional information for regulatory purposes and
for distribution to shareholders; provided, however, that nothing
contained herein shall be deemed to require the Fund to pay any
of the costs of advertising the sale of Shares.
1.6 The Fund agrees to execute any and all documents
and to furnish any and all information and otherwise to take all
actions which may be reasonably necessary in the discretion of
the Fund's officers in connection with the qualification of
Shares for sale in such states as you may designate to the Fund
and the Fund may approve, and the Fund agrees to pay all expenses
which may be incurred in connection with such qualification. You
shall pay all expenses connected with your own qualification as a
dealer under state or Federal laws and, except as otherwise
specifically provided in this agreement, all other expenses
incurred by you in connection with the sale of Shares as
contemplated in this agreement.
1.7 The Fund shall furnish you from time to time, for
use in connection with the sale of Shares, such information with
respect to the Fund or any relevant Series and the Shares as you
may reasonably request, all of which shall be signed by one or
more of the Fund's duly authorized officers; and the Fund
warrants that the statements contained in any such information,
when so signed by the Fund's officers, shall be true and correct.
The Fund also shall furnish you upon request with: (a) semi-
annual reports and annual audited reports of the Fund's books and
accounts made by independent public accountants regularly
retained by the Fund, (b) quarterly earnings statements prepared
by the Fund, (c) a monthly itemized list of the securities in the
Fund's or, if applicable, each Series' portfolio, (d) monthly
balance sheets as soon as practicable after the end of each
month, and (e) from time to time such additional information
regarding the Fund's financial condition as you may reasonably
request.
1.8 The Fund represents to you that all registration
statements and prospectuses filed by the Fund with the Securities
and Exchange Commission under the Securities Act of 1933, as
amended, and under the Investment Company Act of 1940, as
amended, with respect to the Shares have been carefully prepared
in conformity with the requirements of said Acts and rules and
regulations of the Securities and Exchange Commission thereunder.
As used in this agreement the terms "registration statement" and
"prospectus" shall mean any registration statement and prospec-
tus, including the statement of additional information
incorporated by reference therein, filed with the Securities and
Exchange Commission and any amendments and supplements thereto
which at any time shall have been filed with said Commission.
The Fund represents and warrants to you that any registration
statement and prospectus, when such registration statement
becomes effective, will contain all statements required to be
stated therein in conformity with said Acts and the rules and
regulations of said Commission; that all statements of fact
contained in any such registration statement and prospectus will
be true and correct when such registration statement becomes
effective; and that neither any registration statement nor any
prospectus when such registration statement becomes effective
will include an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary
to make the statements therein not misleading. The Fund may but
shall not be obligated to propose from time to time such amend-
ment or amendments to any registration statement and such supple-
ment or supplements to any prospectus as, in the light of future
developments, may, in the opinion of the Fund's counsel, be
necessary or advisable. If the Fund shall not propose such
amendment or amendments and/or supplement or supplements within
fifteen days after receipt by the Fund of a written request from
you to do so, you may, at your option, terminate this agreement
or decline to make offers of the Fund's securities until such
amendments are made. The Fund shall not file any amendment to
any registration statement or supplement to any prospectus
without giving you reasonable notice thereof in advance;
provided, however, that nothing contained in this agreement shall
in any way limit the Fund's right to file at any time such amend-
ments to any registration statement and/or supplements to any
prospectus, of whatever character, as the Fund may deem
advisable, such right being in all respects absolute and
unconditional.
1.9 The Fund authorizes you to use any prospectus in
the form furnished to you from time to time, in connection with
the sale of Shares. The Fund agrees to indemnify, defend and
hold you, your several officers and directors, and any person who
controls you within the meaning of Section 15 of the Securities
Act of 1933, as amended, free and harmless from and against any
and all claims, demands, liabilities and expenses (including the
cost of investigating or defending such claims, demands or
liabilities and any counsel fees incurred in connection there-
with) which you, your officers and directors, or any such con-
trolling person, may incur under the Securities Act of 1933, as
amended, or under common law or otherwise, arising out of or
based upon any untrue statement, or alleged untrue statement, of
a material fact contained in any registration statement or any
prospectus or arising out of or based upon any omission, or
alleged omission, to state a material fact required to be stated
in either any registration statement or any prospectus or
necessary to make the statements in either thereof not
misleading; provided, however, that the Fund's agreement to
indemnify you, your officers or directors, and any such control-
ling person shall not be deemed to cover any claims, demands,
liabilities or expenses arising out of any untrue statement or
alleged untrue statement or omission or alleged omission made in
any registration statement or prospectus in reliance upon and in
conformity with written information furnished to the Fund by you
specifically for use in the preparation thereof. The Fund's
agreement to indemnify you, your officers and directors, and any
such controlling person, as aforesaid, is expressly conditioned
upon the Fund's being notified of any action brought against you,
your officers or directors, or any such controlling person, such
notification to be given by letter or by telegram addressed to
the Fund at its address set forth above within ten days after the
summons or other first legal process shall have been served. The
failure so to notify the Fund of any such action shall not
relieve the Fund from any liability which the Fund may have to
the person against whom such action is brought by reason of any
such untrue, or alleged untrue, statement or omission, or alleged
omission, otherwise than on account of the Fund's indemnity
agreement contained in this paragraph 1.9. The Fund will be
entitled to assume the defense of any suit brought to enforce any
such claim, demand or liability, but, in such case, such defense
shall be conducted by counsel of good standing chosen by the Fund
and approved by you. In the event the Fund elects to assume the
defense of any such suit and retain counsel of good standing
approved by you, the defendant or defendants in such suit shall
bear the fees and expenses of any additional counsel retained by
any of them; but in case the Fund does not elect to assume the
defense of any such suit, or in case you do not approve of
counsel chosen by the Fund, the Fund will reimburse you, your
officers and directors, or the controlling person or persons
named as defendant or defendants in such suit, for the fees and
expenses of any counsel retained by you or them. The Fund's
indemnification agreement contained in this paragraph 1.9 and the
Fund's representations and warranties in this agreement shall
remain operative and in full force and effect regardless of any
investigation made by or on behalf of you, your officers and
directors, or any controlling person, and shall survive the
delivery of any Shares. This agreement of indemnity will inure
exclusively to your benefit, to the benefit of your several
officers and directors, and their respective estates, and to the
benefit of any controlling persons and their successors. The
Fund agrees promptly to notify you of the commencement of any
litigation or proceedings against the Fund or any of its officers
or Board members in connection with the issue and sale of Shares.
1.10 You agree to indemnify, defend and hold the Fund,
its several officers and Board members, and any person who con-
trols the Fund within the meaning of Section 15 of the Securities
Act of 1933, as amended, free and harmless from and against any
and all claims, demands, liabilities and expenses (including the
cost of investigating or defending such claims, demands or
liabilities and any counsel fees incurred in connection there-
with) which the Fund, its officers or Board members, or any such
controlling person, may incur under the Securities Act of 1933,
as amended, or under common law or otherwise, but only to the
extent that such liability or expense incurred by the Fund, its
officers or Board members, or such controlling person resulting
from such claims or demands, shall arise out of or be based upon
any untrue, or alleged untrue, statement of a material fact
contained in information furnished in writing by you to the Fund
specifically for use in the Fund's registration statement and
used in the answers to any of the items of the registration
statement or in the corresponding statements made in the prospec-
tus, or shall arise out of or be based upon any omission, or
alleged omission, to state a material fact in connection with
such information furnished in writing by you to the Fund and
required to be stated in such answers or necessary to make such
information not misleading. Your agreement to indemnify the
Fund, its officers and Board members, and any such controlling
person, as aforesaid, is expressly conditioned upon your being
notified of any action brought against the Fund, its officers or
Board members, or any such controlling person, such notification
to be given by letter or telegram addressed to you at your
address set forth above within ten days after the summons or
other first legal process shall have been served. You shall have
the right to control the defense of such action, with counsel of
your own choosing, satisfactory to the Fund, if such action is
based solely upon such alleged misstatement or omission on your
part, and in any other event the Fund, its officers or Board
members, or such controlling person shall each have the right to
participate in the defense or preparation of the defense of any
such action. The failure so to notify you of any such action
shall not relieve you from any liability which you may have to
the Fund, its officers or Board members, or to such controlling
person by reason of any such untrue, or alleged untrue, statement
or omission, or alleged omission, otherwise than on account of
your indemnity agreement contained in this paragraph 1.10. This
agreement of indemnity will inure exclusively to the Fund's
benefit, to the benefit of the Fund's officers and Board members,
and their respective estates, and to the benefit of any
controlling persons and their successors.
You agree promptly to notify the Fund of the commencement of any
litigation or proceedings against you or any of your officers or
directors in connection with the issue and sale of Shares.
1.11 No Shares shall be offered by either you or the
Fund under any of the provisions of this agreement and no orders
for the purchase or sale of such Shares hereunder shall be
accepted by the Fund if and so long as the effectiveness of the
registration statement then in effect or any necessary amendments
thereto shall be suspended under any of the provisions of the
Securities Act of 1933, as amended, or if and so long as a
current prospectus as required by Section 10 of said Act, as
amended, is not on file with the Securities and Exchange
Commission; provided, however, that nothing contained in this
paragraph 1.11 shall in any way restrict or have an application
to or bearing upon the Fund's obligation to repurchase any Shares
from any shareholder in accordance with the provisions of the
Fund's prospectus or charter documents.
1.12 The Fund agrees to advise you immediately in
writing:
(a) of any request by the Securities and Exchange
Commission for amendments to the registration statement
or prospectus then in effect or for additional
information;
(b) in the event of the issuance by the Securi-
ties and Exchange Commission of any stop order sus-
pending the effectiveness of the registration statement
or prospectus then in effect or the initiation of any
proceeding for that purpose;
(c) of the happening of any event which makes
untrue any statement of a material fact made in the
registration statement or prospectus then in effect or
which requires the making of a change in such registra-
tion statement or prospectus in order to make the
statements therein not misleading; and
(d) of all actions of the Securities and
Exchange Commission with respect to any amendments to
any registration statement or prospectus which may from
time to time be filed with the Securities and Exchange
Commission.
2. Offering Price
Shares of any class of the Fund offered for sale by you
shall be offered for sale at a price per share (the "offering
price") approximately equal to (a) their net asset value
(determined in the manner set forth in the Fund's charter
documents) plus (b) a sales charge, if any and except to those
persons set forth in the then-current prospectus, which shall be
the percentage of the offering price of such Shares as set forth
in the Fund's then-current prospectus. The offering price, if
not an exact multiple of one cent, shall be adjusted to the
nearest cent. In addition, Shares of any class of the Fund
offered for sale by you may be subject to a contingent deferred
sales charge as set forth in the Fund's then-current prospectus.
You shall be entitled to receive any sales charge or contingent
deferred sales charge in respect of the Shares. Any payments to
dealers shall be governed by a separate agreement between you and
such dealer and the Fund's then-current prospectus.
3. Term
This agreement shall continue until the date (the
"Reapproval Date") set forth on Exhibit A hereto (and, if the
Fund has Series, a separate Reapproval Date shall be specified on
Exhibit A for each Series), and thereafter shall continue
automatically for successive annual periods ending on the day
(the "Reapproval Day") of each year set forth on Exhibit A
hereto, provided such continuance is specifically approved at
least annually by (i) the Fund's Board or (ii) vote of a majority
(as defined in the Investment Company Act of 1940) of the Shares
of the Fund or the relevant Series, as the case may be, provided
that in either event its continuance also is approved by a
majority of the Board members who are not "interested persons"
(as defined in said Act) of any party to this agreement, by vote
cast in person at a meeting called for the purpose of voting on
such approval. This agreement is terminable without penalty, on
60 days' notice, by vote of holders of a majority of the Fund's
or, as to any relevant Series, such Series' outstanding voting
securities or by the Fund's Board as to the Fund or the relevant
Series, as the case may be. This agreement is terminable by you,
upon 270 days' notice, effective on or after the fifth
anniversary of the date hereof. This agreement also will
terminate automatically, as to the Fund or relevant Series, as
the case may be, in the event of its assignment (as defined in
said Act).
4. Exclusivity
The Fund acknowledges that the persons employed by you
to assist in the performance of your duties under this agreement
may not devote their full time to such service and nothing
contained in this agreement shall be deemed to limit or restrict
your or any of your affiliates' right to engage in and devote
time and attention to other businesses or to render services of
whatever kind or nature.
5. Miscellaneous
This agreement has been executed on behalf of the Fund
by the undersigned officer of the Fund in his capacity as an
officer of the Fund. The obligations of this agreement shall
only be binding upon the assets and property of the Fund and
shall not be binding upon any Board member, officer or
stockholder of the Fund individually.
Please confirm that the foregoing is in accordance with
your understanding and indicate your acceptance hereof by signing
below, whereupon it shall become a binding agreement between us.
Very truly yours,
PRAIRIE FUNDS
By:
Accepted:
CONCORD FINANCIAL GROUP, INC.
By:________________________
<PAGE>
EXHIBIT A
Name of Series Reapproval Date Reapproval Day
- -------------------------------- --------------- --------------
Bond Fund
Equity Income Fund
Growth Fund
Intermediate Municipal Bond Fund
International Bond Fund
International Equity Fund
Managed Assets Fund
Managed Assets Income Fund
Money Market Fund
Municipal Money Market Fund
Special Opportunities Fund
<PAGE>
EXHIBIT 8
CUSTODY AND FUND ACCOUNTING AGREEMENT
Custody and Fund Accounting Agreement made as of
November 18, 1994 between PRAIRIE FUNDS, a business trust
organized and existing under the laws of the Commonwealth of
Massachusetts, having its principal office and place of business
at 125 West 55th Street, New York, New York 10019 (hereinafter
called the "Fund"), and THE BANK OF NEW YORK, a New York
corporation authorized to do a banking business, having its
principal office and place of business at 110 Washington Street,
New York, New York 10286 (hereinafter called the "Custodian").
W I T N E S S E T H :
that for and in consideration of the mutual promises hereinafter
set forth the Fund and the Custodian agree as follows:
ARTICLE I
DEFINITIONS
Whenever used in this Agreement, the following words
and phrases, unless the context otherwise requires, shall have
the following meanings:
1. "Authorized Person" shall be deemed to include the
Treasurer, the Controller or any other person, whether or not any
such person is an Officer or employee of the Fund, duly
authorized by the Fund's Board to give Oral Instructions and
Written Instructions on behalf of the Fund and listed in the
Certificate annexed hereto as Appendix A or such other
Certificate as may be received by the Custodian from time to
time.
2. "Available Balance" shall mean for any given day
during a calendar year the aggregate amount of Federal Funds held
in the Fund's custody account(s) at The Bank of New York, or its
successors, as of the close of such day or, if such day is not a
business day, the close of the preceding business day.
3. "Bankruptcy" shall mean with respect to a party
such party's making a general assignment, arrangement or
composition with or for the benefit of its creditors, or
instituting or having instituted against it a proceeding seeking
a judgment of insolvency or bankruptcy or the entry of an order
for relief under the Federal bankruptcy law or any other relief
under any bankruptcy or insolvency law or other similar law
affecting creditors' rights, or if a petition is presented for
the winding up or liquidation of the party or a resolution is
passed for its winding up or liquidation, or it seeks, or becomes
subject to, the appointment of an administrator, receiver,
trustee, custodian or other similar official for it or for all or
substantially all of its assets or its taking any action in
furtherance of, or indicating its consent to approval of, or
acquiescence in, any of the foregoing.
4. "Book-Entry System" shall mean the Federal Reserve/
Treasury book-entry system for United States and Federal agency
securities, its successor or successors and its nominee or
nominees.
5. "Call Option" shall mean an exchange traded option
with respect to Securities other than Stock Index Options,
Futures Contracts and Futures Contract Options entitling the
holder, upon timely exercise and payment of the exercise price,
as specified therein, to purchase from the writer thereof the
specified underlying Securities.
6. "Certificate" shall mean any notice, instruction,
or other instrument in writing, authorized or required by this
Agreement to be given to the Custodian, which is actually
received by the Custodian and signed on behalf of the Fund by any
two Officers of the Fund.
7. "Clearing Member" shall mean a registered broker-
dealer which is a clearing member under the rules of O.C.C. and a
member of a national securities exchange qualified to act as a
custodian for an investment company, or any broker-dealer
reasonably believed by the Custodian to be such a clearing
member.
8. "Collateral Account" shall mean a segregated
account so denominated and pledged to the Custodian as security
for, and in consideration of, the Custodian's issuance of (a) any
Put Option guarantee letter or similar document described in
paragraph 8 of Article V herein, or (b) any receipt described in
Article V or VIII herein.
9. "Consumer Price Index" shall mean the U.S. Consumer
Price Index, all items and all urban consumers, U.S. city average
l982-84 equals 100, as first published without seasonal
adjustment by the Bureau of Labor Statistics, the Department of
Labor, without regard to subsequent revisions or corrections by
such Bureau.
10. "Covered Call Option" shall mean an exchange
traded option entitling the holder, upon timely exercise and
payment of the exercise price, as specified therein, to purchase
from the writer thereof the specified Securities (excluding
Futures Contracts) which are owned by the writer thereof and
subject to appropriate restrictions.
11. "Depository" shall mean The Depository Trust
Company ("DTC"), a clearing agency registered with the Securities
and Exchange Commission, its successor or successors and its
nominee or nominees, provided the Custodian has received a
certified copy of a resolution of the Fund's Board specifically
approving deposits in DTC. The term "Depository" shall further
mean and include any other person authorized to act as a
depository under the Investment Company Act of 1940, as amended,
its successor or successors and its nominee or nominees,
specifically identified in a certified copy of a resolution of
the Fund's Board specifically approving deposits therein by the
Custodian.
12. "Earnings Credit" shall mean for any given day
during a calendar year the product of (a) the Federal Funds Rate
for such date minus .25%, and (b) 82% of the Available Balance.
13. "Federal Funds" shall mean immediately available
same day funds.
14. "Federal Funds Rate" shall mean, for any day, the
Federal Funds (Effective) interest rate so denominated as
published in Federal Reserve Statistical Release H.15 (519) and
applicable to such day and each succeeding day which is not a
business day.
15. "Financial Futures Contract" shall mean the firm
commitment to buy or sell fixed income securities, including,
without limitation, U.S. Treasury Bills, U.S. Treasury Notes,
U.S. Treasury Bonds, domestic bank certificates of deposit, and
Eurodollar certificates of deposit, during a specified month at
an agreed upon price.
16. "Futures Contract" shall mean a Financial Futures
Contract and/or Stock Index Futures Contracts.
17. "Futures Contract Option" shall mean an option
with respect to a Futures Contract.
18. "Margin Account" shall mean a segregated account
in the name of a broker, dealer, futures commission merchant or
Clearing Member, or in the name of the Fund for the benefit of a
broker, dealer, futures commission merchant or Clearing Member,
or otherwise, in accordance with an agreement between the Fund,
the Custodian and a broker, dealer, futures commission merchant
or Clearing Member (a "Margin Account Agreement"), separate and
distinct from the custody account, in which certain Securities
and/or money of the Fund shall be deposited and withdrawn from
time to time in connection with such transactions as the Fund may
from time to time determine. Securities held in the Book-Entry
System or the Depository shall be deemed to have been deposited
in, or withdrawn from, a Margin Account upon the Custodian's
effecting an appropriate entry on its books and records.
19. "Merger" shall mean with respect to a party, the
consolidation or amalgamation with, merger into, or transfer of
all or substantially all of such party's assets to, another
entity, where such party is not the surviving entity.
20. "Money Market Security" shall be deemed to
include, without limitation, debt obligations issued or
guaranteed as to principal and interest by the government of the
United States or agencies or instrumentalities thereof,
commercial paper, certificates of deposit and bankers'
acceptances, repurchase and reverse repurchase agreements with
respect to the same and bank time deposits, where the purchase
and sale of such securities ordinarily requires settlement in
Federal funds on the same date as such purchase or sale.
21. "O.C.C." shall mean Options Clearing Corporation,
a clearing agency registered under Section 17A of the Securities
Exchange Act of 1934, its successor or successors, and its
nominee or nominees.
22. "Officers" shall be deemed to include the
President, any Vice President, the Secretary, the Treasurer, the
Controller, any Assistant Secretary, any Assistant Treasurer or
any other person or persons duly authorized by the Fund's Board
to execute any Certificate, instruction, notice or other
instrument on behalf of the Fund and listed in the Certificate
annexed hereto as Appendix B or such other Certificate as may be
received by the Custodian from time to time.
23. "Option" shall mean a Call Option, Covered Call
Option, Stock Index Option and/or a Put Option.
24. "Oral Instructions" shall mean verbal instructions
actually received by the Custodian from an Authorized Person or
from a person reasonably believed by the Custodian to be an
Authorized Person.
25. "Prospectus" shall mean the last Fund prospectus
actually received by the Custodian from the Fund with respect to
which the Fund has indicated a registration statement under the
Federal Securities Act of 1933 has become effective, including
the statement of additional information incorporated by reference
therein.
26. "Put Option" shall mean an exchange traded option
with respect to Securities other than Stock Index Options,
Futures Contracts, and Futures Contract Options entitling the
holder, upon timely exercise and tender of the specified
underlying Securities, to sell such Securities to the writer
thereof for the exercise price.
27. "Reverse Repurchase Agreement" shall mean an
agreement pursuant to which the Fund sells Securities and agrees
to repurchase such Securities at a described or specified date
and price.
28. "Security" shall be deemed to include, without
limitation, Money Market Securities, Call Options, Put Options,
Stock Index Options, Stock Index Futures Contracts, Stock Index
Futures Contract Options, Financial Futures Contracts, Financial
Futures Contract Options, Reverse Repurchase Agreements, common
stock and other instruments or rights having characteristics
similar to common stocks, preferred stocks, debt obligations
issued by state or municipal governments and by public
authorities (including, without limitation, general obligation
bonds, revenue bonds and industrial bonds and industrial
development bonds), bonds, debentures, notes, mortgages or other
obligations, and any certificates, receipts, warrants or other
instruments representing rights to receive, purchase, sell or
subscribe for the same, or evidencing or representing any other
rights or interest therein, or any property or assets.
29. "Segregated Security Account" shall mean an
account maintained under the terms of this Agreement as a
segregated account, by recordation or otherwise, within the
custody account in which certain Securities and/or other assets
of the Fund shall be deposited and withdrawn from time to time in
accordance with Certificates received by the Custodian in
connection with such transactions as the Fund may from time to
time determine.
30. "Series" shall mean (i) the Series of the Fund
specified on Appendix D hereto, or, where the context requires
each such Series, or (ii) if no Series are set forth on such
Appendix, the Fund.
31. "Shares" shall mean the shares of beneficial
interest of any Series of the Fund, each of which is allocated to
a particular Series.
32. "Stock Index Futures Contract" shall mean a
bilateral agreement pursuant to which the parties agree to take
or make delivery of an amount of cash equal to a specified dollar
amount times the difference between the value of a particular
stock index at the close of the last business day of the contract
and the price at which the futures contract is originally struck.
33. "Stock Index Option" shall mean an exchange traded
option entitling the holder, upon timely exercise, to receive an
amount of cash determined by reference to the difference between
the exercise price and the value of the index on the date of
exercise.
34. "Written Instructions" shall mean written
communications actually received by the Custodian from an
Authorized Person or from a person reasonably believed by the
Custodian to be an Authorized Person by telex or any other such
system whereby the receiver of such communications is able to
verify by codes or otherwise with a reasonable degree of
certainty the authenticity of the sender of such communication.
ARTICLE II
APPOINTMENT OF CUSTODIAN
1. The Fund hereby constitutes and appoints the
Custodian as custodian of all the Securities and moneys at any
time owned by the Fund during the period of this Agreement,
except that (a) if the Custodian fails to provide for the custody
of any of the Fund's Securities and moneys located or to be
located outside the United States in a manner satisfactory to the
Fund, the Fund shall be permitted to arrange for the custody of
such Securities and moneys located or to be located outside the
United States other than through the Custodian at rates to be
negotiated and borne by the Fund and (b) if the Custodian fails
to continue any existing sub-custodial or similar arrangements on
substantially the same terms as exist on the date of this
Agreement, the Fund shall be permitted to arrange for such or
similar services other than through the Custodian at rates to be
negotiated and borne by the Fund. The Custodian shall not charge
the Fund for any such terminated services after the date of such
termination. The Fund also hereby engages the Custodian to
perform certain recordkeeping and fund accounting services for
the Fund.
2. The Custodian hereby accepts appointment as such
custodian and agrees to perform the duties thereof and in
connection with recordkeeping and fund accounting for the Fund as
hereinafter set forth.
ARTICLE III
CUSTODY OF CASH AND SECURITIES
1. Except as otherwise provided in paragraph 7 of this
Article and in Article VIII, the Fund will deliver or cause to be
delivered to the Custodian all Securities and all moneys owned by
any Series, including cash received for the issuance of such
Series' shares, at any time during the period of this Agreement
and shall specify the Series, if any, to which the same are to be
specifically allocated. The Custodian will not be responsible
for such Securities and such moneys until actually received by
it. The Custodian will be entitled to reverse any credits made
on a Series' behalf where such credits have been previously made
and moneys are not finally collected. The Fund shall deliver to
the Custodian a certified resolution of the Fund's Board
approving, authorizing and instructing the Custodian on a
continuous and on-going basis to deposit in the Book-Entry System
all Securities eligible for deposit therein and to utilize the
Book-Entry System to the extent possible 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 Securities
collateral. Prior to a deposit of Securities of a Series in the
Depository, the Fund shall deliver to the Custodian a certified
resolution of the Fund's Board approving, authorizing and
instructing the Custodian on a continuous and on-going basis
until instructed to the contrary by a Certificate actually
received by the Custodian to deposit in the Depository all
Securities eligible for deposit therein and to utilize the
Depository to the extent possible 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 Securities
collateral. Securities and moneys of such Series deposited in
either the Book-Entry System or the Depository will be
represented in accounts which include only assets held by the
Custodian for customers, including, but not limited to, accounts
in which the Custodian acts in a fiduciary or representative
capacity. Prior to the Custodian's accepting, utilizing and
acting with respect to Clearing Member confirmations for Options
and transactions in Options as provided in this Agreement, the
Custodian shall have received a certified resolution of the
Fund's Board approving, authorizing and instructing the Custodian
on a continuous and on-going basis, until instructed to the
contrary by a Certificate actually received by the Custodian, to
accept, utilize and act in accordance with such confirmations as
provided in this Agreement.
2. The Custodian shall credit to a separate account in
the name of the Fund for each Series all moneys received by it
for the account of the Fund, with respect to such Series. Money
credited to the separate account for a Series shall be disbursed
by the Custodian only:
(a) In payment for Securities purchased, as provided
in Article IV hereof;
(b) In payment of dividends or distributions, as
provided in Article XI hereof;
(c) In payment of original issue or other taxes, as
provided in Article XII hereof;
(d) In payment for Shares redeemed by it, as provided
in Article XII hereof;
(e) Pursuant to Certificates setting forth the name
and address of the person to whom the payment is to be made, the
Series account from which payment is to be made and the purpose
for which payment is to be made; or
(f) In payment of the fees and in reimbursement of the
expenses and liabilities of the Custodian, as provided in Article
XV hereof.
3. Promptly after the close of business on each day,
the Custodian shall furnish the Fund with confirmations and a
summary of all transfers to or from the account of each Series
during said day. Where Securities are transferred to the account
of a Series, the Custodian shall also by book-entry or otherwise
identify as belonging to such Series a quantity of Securities in
a fungible bulk of Securities registered in the name of the
Custodian (or its nominee) or shown on the Custodian's account on
the books of the Book-Entry System or the Depository. At least
monthly and from time to time, the Custodian shall furnish the
Fund with a detailed statement of the Securities and moneys held
for each Series under this Agreement.
4. Except as otherwise provided in paragraph 7 of this
Article and in Article VIII, all Securities held for a Series,
which are issued or issuable only in bearer form, except such
Securities as are held in the Book-Entry System, shall be held by
the Custodian in that form; all other Securities held for a
Series may be registered in the name of such Series, in the name
of any duly appointed registered nominee of the Custodian as the
Custodian may from time to time determine, or in the name of the
Book-Entry System or the Depository or their successor or
successors, or their nominee or nominees. The Fund agrees to
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 its registered nominee or in the name of
the Book-Entry System or the Depository, any Securities which it
may hold for the account of a Series and which may from time to
time be registered in the name of such Series. The Custodian
shall hold all such Securities which are not held in the Book-
Entry System or in the Depository in a separate account in the
name of such Series physically segregated at all times from those
of any other person or persons.
5. Except as otherwise provided in this Agreement and
unless otherwise instructed to the contrary by a Certificate, the
Custodian by itself, or through the use of the Book-Entry System
or the Depository with respect to Securities therein deposited,
shall with respect to all Securities held for each Series in
accordance with this Agreement:
(a) Collect all income due or payable and, in any
event, if the Custodian receives a written notice from the Fund
specifying that an amount of income should have been received by
the Custodian within the last 90 days, the Custodian will provide
a conditional payment of income within 60 days from the date the
Custodian received such notice, unless the Custodian reasonably
concludes that such income was not due or payable to the Fund,
provided that the Custodian may reverse any such conditional
payment upon its reasonably concluding that all or any portion of
such income was not due or payable, and provided further that the
Custodian shall not be liable for failing to collect on a timely
basis the full amount of income due or payable in respect of a
"floating rate instrument" or "variable rate instrument" (as such
terms are defined under Rule 2a-7 under the Investment Company
Act of l940, as amended) if it has acted in good faith, without
negligence or willful misconduct.
(b) Present for payment and collect the amount payable
upon such Securities which are called, but only if either (i) the
Custodian receives a written notice of such call, or (ii) notice
of such call appears in one or more of the publications listed in
Appendix C annexed hereto, which may be amended at any time by
the Custodian upon five business days' prior notification to the
Fund;
(c) Present for payment and collect the amount payable
upon all Securities which may mature;
(d) Surrender Securities in temporary form for
definitive Securities;
(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
(f) Hold directly, or through the Book-Entry System or
the Depository with respect to Securities therein deposited, for
the account of each Series all rights and similar securities
issued with respect to any Securities held by the Custodian
hereunder.
6. Upon receipt of a Certificate and not otherwise,
the Custodian, directly or through the use of the Book-Entry
System or the Depository, shall:
(a) Execute and deliver to such persons as may be
designated in such Certificate proxies, consents, authorizations,
and any other instruments whereby the authority of the Fund as
owner of any Securities may be exercised;
(b) Deliver any Securities held for the Series in
exchange for other Securities or cash issued or paid in
connection with the liquidation, reorganization, refinancing,
merger, consolidation or recapitalization of any corporation, or
the exercise of any conversion privilege;
(c) Deliver any Securities held for the Series to any
protective committee, reorganization committee or other person in
connection with the reorganization, refinancing, merger,
consolidation, recapitalization or sale of assets of any
corporation, and receive and hold under the terms of this
Agreement such certificates of deposit, interim receipts or other
instruments or documents as may be issued to it to evidence such
delivery;
(d) Make such transfers or exchanges of the assets of
the Series and take such other steps as shall be stated in said
order to be for the purpose of effectuating any duly authorized
plan of liquidation, reorganization, merger, consolidation or
recapitalization of the Fund; and
(e) Present for payment and collect the amount payable
upon Securities not described in preceding paragraph 5(b) of this
Article which may be called as specified in the Certificate.
7. Notwithstanding any provision elsewhere contained
herein, the Custodian shall not be required to obtain possession
of any instrument or certificate representing any Futures
Contract, Option or Futures Contract Option until after it shall
have determined, or shall have received a Certificate from the
Fund stating, that any such instruments or certificates are
available. The Fund shall deliver to the Custodian such a
Certificate no later than the business day preceding the
availability of any such instrument or certificate. Prior to
such availability, the Custodian shall comply with Section 17(f)
of the Investment Company Act of 1940, as amended, in connection
with the purchase, sale, settlement, closing out or writing of
Futures Contracts, Options or Futures Contract Options by making
payments or deliveries specified in Certificates received by the
Custodian in connection with any such purchase, sale, writing,
settlement or closing out upon its receipt from a broker, dealer
or futures commission merchant of a statement or confirmation
reasonably believed by the Custodian to be in the form
customarily used by brokers, dealers, or futures commission
merchants with respect to such Futures Contracts, Options or
Futures Contract Options, as the case may be, confirming that
such Security is held by such broker, dealer or futures
commission merchant, in book-entry form or otherwise, in the name
of the Custodian (or any nominee of the Custodian) as custodian
for the Fund, provided, however, that payments to or deliveries
from the Margin Account shall be made in accordance with the
terms and conditions of the Margin Account Agreement. Whenever
any such instruments or certificates are available, the Custodian
shall, notwithstanding any provision in this Agreement to the
contrary, make payment for any Futures Contract, Option or
Futures Contract Option for which such instruments or such
certificates are available only against the delivery to the
Custodian of such instrument or such certificate, and deliver any
Futures Contract, Option or Futures Contract Option for which
such instruments or such certificates are available only against
receipt by the Custodian of payment therefor. Any such
instrument or certificate delivered to the Custodian shall be
held by the Custodian hereunder in accordance with, and subject
to, the provisions of this Agreement.
ARTICLE IV
PURCHASE AND SALE OF INVESTMENTS OF THE FUND OTHER THAN OPTIONS,
FUTURES CONTRACTS, FUTURES CONTRACT OPTIONS AND REVERSE
REPURCHASE AGREEMENTS
1. Promptly after each purchase of Securities by the
Fund, other than a purchase of any Option, Futures Contract,
Futures Contract Option or Reverse Repurchase Agreement, the Fund
shall deliver to the Custodian (i) with respect to each purchase
of Securities which are not Money Market Securities, a
Certificate, and (ii) with respect to each purchase of Money
Market Securities, a Certificate, Oral Instructions or Written
Instructions, specifying with respect to each such purchase: (a)
the Series to which the Securities purchased are to be
specifically allocated; (b) the name of the issuer and the title
of the Securities; (c) the number of shares or the principal
amount purchased and accrued interest, if any; (d) the date of
purchase and settlement; (e) the purchase price per unit; (f) the
total amount payable upon such purchase; (g) the name of the
person from whom or the broker through whom the purchase was
made, and the name of the clearing broker, if any; and (h) the
name of the broker to which payment is to be made. The Custodian
shall, upon receipt of Securities purchased by or for such
Series, pay out of the moneys held for the account of such Series
the total amount payable to the person from whom, or the broker
through whom, the purchase was made, provided that the same
conforms to the total amount payable as set forth in such
Certificate, Oral Instructions or Written Instructions.
2. Promptly after each sale of Securities by the Fund,
other than a sale of any Option, Futures Contract, Futures
Contract Option or Reverse Repurchase Agreement, the Fund shall
deliver to the Custodian (i) with respect to each sale of
Securities which are not Money Market Securities, a Certificate,
and (ii) with respect to each sale of Money Market Securities, a
Certificate, Oral Instructions or Written Instructions,
specifying with respect to each such sale: (a) the Series to
which such Securities sold were specifically allocated; (b) the
name of the issuer and the title of the Security; (c) the number
of shares or principal amount sold, and accrued interest, if any;
(d) the date of sale; (e) the sale price per unit; (f) the total
amount payable to such Series upon such sale; (g) the name of the
broker through whom or the person to whom the sale was made, and
the name of the clearing broker, if any; and (h) the name of the
broker to whom the Securities are to be delivered. The Custodian
shall deliver the Securities upon receipt of the total amount
payable to the Fund for the account of such Series upon such
sale, provided that the same conforms to the total amount payable
as set forth in such Certificate, Oral Instructions or 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.
ARTICLE V
OPTIONS
1. Promptly after the purchase of any Option by the
Fund, the Fund shall deliver to the Custodian a Certificate
specifying with respect to each Option purchased: (a) the Series
to which the Option purchased is to be specifically allocated;
(b) the type of Option (put or call); (c) the name of the issuer
and the title and number of shares subject to such Option or, in
the case of a Stock Index Option, the stock index to which such
Option relates and the number of Stock Index Options purchased;
(d) the expiration date; (e) the exercise price; (f) the dates of
purchase and settlement; (g) the total amount payable by the Fund
for the account of such Series in connection with such purchase;
(h) the name of the Clearing Member through which such Option was
purchased; and (i) the name of the broker to whom payment is to
be made. The Custodian shall pay, upon receipt of a Clearing
Member's statement confirming the purchase of such Option held by
such Clearing Member for the account of the Custodian (or any
duly appointed and registered nominee of the Custodian) as
custodian for the Fund, out of moneys held for the account of
such Series, the total amount payable upon such purchase to the
Clearing Member through whom the purchase was made, provided that
the same conforms to the total amount payable as set forth in
such Certificate.
2. Promptly after the sale of any Option purchased by
the Fund pursuant to paragraph 1 hereof, the Fund shall deliver
to the Custodian a Certificate specifying with respect to each
such sale: (a) the Series to which the Option sold was
specifically allocated; (b) the type of Option (put or call);
(c) the name of the issuer and the title and number of shares
subject to such Option or, in the case of a Stock Index Option,
the stock index to which such Option relates and the number of
Stock Index Options sold; (d) the date of sale; (e) the sale
price; (f) the date of settlement; (g) the total amount payable
to the Fund for the account of such Series upon such sale; and
(h) the name of the Clearing Member through which the sale was
made. The Custodian shall consent to the delivery of the Option
sold by the Clearing Member which previously supplied the
confirmation described in preceding paragraph 1 of this Article
with respect to such Option against payment to the Custodian of
the total amount payable to the Fund for the account of such
Series, provided that the same conforms to the total amount
payable as set forth in such Certificate.
3. Promptly after the exercise by the Fund of any Call
Option purchased by the Fund pursuant to paragraph 1 hereof, the
Fund shall deliver to the Custodian a Certificate specifying with
respect to such Call Option: (a) the Series to which the Call
Option exercised was specifically allocated; (b) the name of the
issuer and the title and number of shares subject to the Call
Option; (c) the expiration date; (d) the date of exercise and
settlement; (e) the exercise price per share; (f) the total
amount to be paid by the Fund for the account of such Series upon
such exercise; and (g) the name of the Clearing Member through
which such Call Option was exercised. The Custodian shall, upon
receipt of the Securities underlying the Call Option which was
exercised, pay out of the moneys held for the account of such
Series the total amount payable to the Clearing Member through
whom the Call Option was exercised, provided that the same
conforms to the total amount payable as set forth in such
Certificate.
4. Promptly after the exercise by the Fund of any Put
Option purchased by the Fund pursuant to paragraph 1 hereof, the
Fund shall deliver to the Custodian a Certificate specifying with
respect to such Put Option: (a) the Series to which the Put
Option exercised was specifically allocated; (b) the name of the
issuer and the title and number of shares subject to the Put
Option; (c) the expiration date; (d) the date of exercise and
settlement; (e) the exercise price per share; (f) the total
amount to be paid to the Fund for the account of such Series upon
such exercise; and (g) the name of the Clearing Member through
which such Put Option was exercised. The Custodian shall, upon
receipt of the amount payable upon the exercise of the Put
Option, deliver or direct the Depository to deliver the
Securities, provided the same conforms to the amount payable to
the Fund for the account of such Series as set forth in such
Certificate.
5. Promptly after the exercise by the Fund of any
Stock Index Option purchased by the Fund pursuant to paragraph 1
hereof, the Fund shall deliver to the Custodian a Certificate
specifying with respect to such Stock Index Option: (a) the
Series to which the Stock Index Option exercised was specifically
allocated; (b) the type of Stock Index Option (put or call);
(c) the number of Options being exercised; (d) the stock index to
which such Option relates; (e) the expiration date; (f) the
exercise price; (g) the total amount to be received by the Fund
for the account of such Series in connection with such exercise;
and (h) the Clearing Member from which such payment is to be
received.
6. Whenever the Fund writes a Covered Call Option, the
Fund shall promptly deliver to the Custodian a Certificate
specifying with respect to such Covered Call Option: (a) the
Series to which the Covered Call Option written is to be
specifically allocated; (b) the name of the issuer and the title
and number of shares for which the Covered Call Option was
written and which underlie the same; (c) the expiration date;
(d) the exercise price; (e) the premium to be received by the
Fund for the account of such Series; (f) the date such Covered
Call Option was written; and (g) the name of the Clearing Member
through which the premium is to be received. The Custodian shall
deliver or cause to be delivered, in exchange for receipt of the
premium specified in the Certificate with respect to such Covered
Call Option, such receipts as are required in accordance with the
customs prevailing among Clearing Members dealing in Covered Call
Options and shall impose, or direct the Depository to impose,
upon the underlying Securities specified in the Certificate such
restrictions as may be required by such receipts.
Notwithstanding the foregoing, the Custodian has the right, upon
prior written notification to the Fund, at any time to refuse to
issue any receipts for Securities in the possession of the
Custodian and not deposited with the Depository underlying a
Covered Call Option.
7. Whenever a Covered Call Option written by the Fund
and described in the preceding paragraph of this Article is
exercised, the Fund shall promptly deliver to the Custodian a
Certificate instructing the Custodian to deliver, or to direct
the Depository to deliver, the Securities subject to such Covered
Call Option and specifying: (a) the Series to which the Covered
Call Option exercised was specifically allocated; (b) the name of
the issuer and the title and number of shares subject to the
Covered Call Option; (c) the Clearing Member to whom the
underlying Securities are to be delivered; and (d) the total
amount payable to the Fund for the account of such Series upon
such delivery. Upon the return and/or cancellation of any
receipts delivered pursuant to paragraph 6 of this Article, the
Custodian shall deliver, or direct the Depository to deliver, the
underlying Securities as specified in the Certificate for the
amount to be received as set forth in such Certificate.
8. Whenever the Fund writes a Put Option, the Fund
shall promptly deliver to the Custodian a Certificate specifying
with respect to such Put Option: (a) the Series to which the Put
Option written is to be specifically allocated; (b) the name of
the issuer and the title and number of shares for which the Put
Option is written and which underlie the same; (c) the expiration
date; (d) the exercise price; (e) the premium to be received by
the Fund for the account of such Series; (f) the date such Put
Option is written; (g) the name of the Clearing Member through
which the premium is to be received and to whom a Put Option
guarantee letter is to be delivered; (h) the amount of cash,
and/or the amount and kind of Securities, if any, to be deposited
in the Segregated Security Account; and (i) the amount of cash
and/or the amount and kind of Securities to be deposited into the
Collateral Account. The Custodian shall, after making the
deposits into the Collateral Account specified in the
Certificate, issue a Put Option guarantee letter substantially in
the form utilized by the Custodian on the date hereof, and
deliver the same to the Clearing Member specified in the
Certificate against receipt of the premium specified in said
Certificate. Notwithstanding the foregoing, the Custodian shall
be under no obligation to issue any Put Option guarantee letter
or similar document if it is unable to make any of the represen-
tations contained therein.
9. Whenever a Put Option written by the Fund and
described in the preceding paragraph is exercised, the Fund shall
promptly deliver to the Custodian a Certificate specifying: (a)
the Series to which the Put Option exercised was specifically
allocated; (b) the name of the issuer and title and number of
shares subject to the Put Option; (c) the Clearing Member from
which the underlying Securities are to be received; (d) the total
amount payable by the Fund upon such delivery; (e) the amount of
cash and/or the amount and kind of Securities to be withdrawn
from the Collateral Account; and (f) the amount of cash and/or
the amount and kind of Securities, if any, to be withdrawn from
the Segregated Security Account. Upon the return and/or
cancellation of any Put Option guarantee letter or similar
document issued by the Custodian in connection with such Put
Option, the Custodian shall pay out of the moneys held for the
account of such Series the total amount payable to the Clearing
Member specified in the Certificate as set forth in such
Certificate, and shall make the withdrawals specified in such
Certificate.
10. Whenever the Fund writes a Stock Index Option, the
Fund shall promptly deliver to the Custodian a Certificate
specifying with respect to such Stock Index Option: (a) the
Series to which the Stock Index Option written is to be
specifically allocated; (b) whether such Stock Index Option is a
put or a call; (c) the number of Options written; (d) the stock
index to which such Option relates; (e) the expiration date;
(f) the exercise price; (g) the Clearing Member through which
such Option was written; (h) the premium to be received by the
Fund for the account of such Series; (i) the amount of cash
and/or the amount and kind of Securities, if any, to be deposited
in the Segregated Security Account; (j) the amount of cash and/or
the amount and kind of Securities, if any, to be deposited in the
Collateral Account; and (k) the amount of cash and/or the amount
and kind of Securities, if any, to be deposited in a Margin
Account, and the name in which such account is to be or has been
established. The Custodian shall, upon receipt of the premium
specified in the Certificate, make the deposits, if any, into the
Segregated Security Account specified in the Certificate, and
either (1) deliver such receipts, if any, which the Custodian has
specifically agreed to issue, which are in accordance with the
customs prevailing among Clearing Members in Stock Index Options
and make the deposits into the Collateral Account specified in
the Certificate, or (2) make the deposits into the Margin Account
specified in the Certificate.
11. Whenever a Stock Index Option written by the Fund
and described in the preceding paragraph of this Article is
exercised, the Fund shall promptly deliver to the Custodian a
Certificate specifying with respect to such Stock Index Option:
(a) the Series to which the Stock Index Option exercised was
specifically allocated; (b) such information as may be necessary
to identify the Stock Index Option being exercised; (c) the
Clearing Member through which such Stock Index Option is being
exercised; (d) the total amount payable upon such exercise, and
whether such amount is to be paid by or to the Fund for the
account of such Series; (e) the amount of cash and/or amount and
kind of Securities, if any, to be withdrawn from the Margin
Account; and (f) the amount of cash and/or amount and kind of
Securities, if any, to be withdrawn from the Segregated Security
Account and the amount of cash and/or the amount and kind of
Securities, if any, to be withdrawn from the Collateral Account.
Upon the return and/or cancellation of the receipt, if any,
delivered pursuant to the preceding paragraph of this Article,
the Custodian shall pay to the Clearing Member specified in the
Certificate the total amount payable, if any, as specified
therein.
12. Whenever the Fund purchases any Option identical
to a previously written Option described in paragraphs 6, 8 or 10
of this Article in a transaction expressly designated as a
"Closing Purchase Transaction" in order to liquidate its position
as a writer of an Option, the Fund shall promptly deliver to the
Custodian a Certificate specifying with respect to the Option
being purchased: (a) the Series to which the Option purchased is
to be specifically allocated; (b) that the transaction is a
Closing Purchase Transaction; (c) the name of the issuer and the
title and number of shares subject to the Option, or, in the case
of a Stock Index Option, the stock index to which such Option
relates and the number of Options held; (d) the exercise price;
(e) the premium to be paid by the Fund for the account of such
Series; (f) the expiration date; (g) the type of Option (put or
call); (h) the date of such purchase; (i) the name of the
Clearing Member to which the premium is to be paid; and (j) the
amount of cash and/or the amount and kind of Securities, if any,
to be withdrawn from the Collateral Account, a specified Margin
Account or the Segregated Security Account. Upon the Custodian's
payment of the premium and the return and/or cancellation of any
receipt issued pursuant to paragraphs 6, 8 or 10 of this Article
with respect to the Option being liquidated through the Closing
Purchase Transaction, the Custodian shall remove, or direct the
Depository to remove, the previously imposed restrictions on the
Securities underlying the Call Option.
13. Upon the expiration or exercise of, or
consummation of a Closing Purchase Transaction with respect to,
any Option purchased or written by the Fund and described in this
Article, the Custodian shall delete such Option from the
statements delivered to the Fund for the account of a Series
pursuant to paragraph 3 of Article III herein, and upon the
return and/or cancellation of any receipts issued by the
Custodian, shall make such withdrawals from the Collateral
Account, the Margin Account and/or the Segregated Security
Account as may be specified in a Certificate received in
connection with such expiration, exercise, or consummation.
ARTICLE VI
FUTURES CONTRACTS
1. Whenever the Fund shall enter into a Futures
Contract, the Fund shall deliver to the Custodian a Certificate
specifying with respect to such Futures Contract (or with respect
to any number of identical Futures Contract(s)): (a) the Series
to which the Futures Contract entered into is to be specifically
allocated; (b) the category of Futures Contract (the name of the
underlying stock index or financial instrument); (c) the number
of identical Futures Contracts entered into; (d) the delivery or
settlement date of the Futures Contract(s); (e) the date the
Futures Contract(s) was (were) entered into and the maturity
date; (f) whether the Fund is buying (going long) or selling
(going short) on such Futures Contract(s); (g) the amount of cash
and/or the amount and kind of Securities, if any, to be deposited
in the Segregated Security Account; (h) the name of the broker,
dealer or futures commission merchant through which the Futures
Contract was entered into; and (i) the amount of fee or
commission, if any, to be paid and the name of the broker, dealer
or futures commission merchant to whom such amount is to be paid.
The Custodian shall make the deposits, if any, to the Margin
Account in accordance with the terms and conditions of the Margin
Account Agreement. The Custodian shall make payment of the fee
or commission, if any, specified in the Certificate and deposit
in the Segregated Security Account the amount of cash and/or the
amount and kind of Securities specified in said Certificate.
2. (a) Any variation margin payment or similar
payment required to be made by the Fund for the account of a
Series to a broker, dealer or futures commission merchant with
respect to an outstanding Futures Contract shall be made by the
Custodian in accordance with the terms and conditions of the
Margin Account Agreement.
(b) Any variation margin payment or similar
payment from a broker, dealer or futures commission merchant to
the Fund with respect to an outstanding Futures Contract shall be
received and dealt with by the Custodian in accordance with the
terms and conditions of the Margin Account Agreement.
3. Whenever a Futures Contract held by the Custodian
hereunder is retained by the Fund until delivery or settlement is
made on such Futures Contract, the Fund shall deliver to the
Custodian a Certificate specifying: (a) the Series to which the
Futures Contract retained is to be specifically allocated; (b)
the Futures Contract; (c) with respect to a Stock Index Futures
Contract, the total cash settlement amount to be paid or
received, and with respect to a Financial Futures Contract, the
Securities and/or amount of cash to be delivered or received; (d)
the broker, dealer or futures commission merchant to or from
which payment or delivery is to be made or received; and (e) the
amount of cash and/or Securities to be withdrawn from the
Segregated Security Account. The Custodian shall make the
payment or delivery specified in the Certificate and delete such
Futures Contract from the statements delivered to the Fund
pursuant to paragraph 3 of Article III herein.
4. Whenever the Fund shall enter into a Futures
Contract to offset a Futures Contract held by the Custodian
hereunder, the Fund shall deliver to the Custodian a Certificate
specifying: (a) the Series to which the offsetting Futures
Contract is to be specifically allocated; (b) the items of
information required in a Certificate described in paragraph 1 of
this Article, and (c) the Futures Contract being offset. The
Custodian shall make payment of the fee or commission, if any,
specified in the Certificate and delete the Futures Contract
being offset from the statements delivered to the Fund for the
account of such Series pursuant to paragraph 3 of Article III
herein, and make such withdrawals from the Segregated Security
Account as may be specified in such Certificate. The
withdrawals, if any, to be made from the Margin Account shall be
made by the Custodian in accordance with the terms and conditions
of the Margin Account Agreement.
ARTICLE VII
FUTURES CONTRACT OPTIONS
1. Promptly after the purchase of any Futures Contract
Option by the Fund, the Fund shall deliver to the Custodian a
Certificate specifying with respect to such Futures Contract
Option: (a) the Series to which the Futures Contract Option
purchased is to be specifically allocated; (b) the type of
Futures Contract Option (put or call); (c) the type of Futures
Contract and such other information as may be necessary to
identify the Futures Contract underlying the Futures Contract
Option purchased; (d) the expiration date; (e) the exercise
price; (f) the dates of purchase and settlement; (g) the amount
of premium to be paid by the Fund for the account of such Series
upon such purchase; (h) the name of the broker or futures
commission merchant through which such option was purchased; and
(i) the name of the broker or futures commission merchant to whom
payment is to be made. The Custodian shall pay the total amount
to be paid upon such purchase to the broker or futures commission
merchant through whom the purchase was made, provided that the
same conforms to the amount set forth in such Certificate.
2. Promptly after the sale of any Futures Contract
Option purchased by the Fund pursuant to paragraph 1 hereof, the
Fund shall promptly deliver to the Custodian a Certificate
specifying with respect to each such sale: (a) the Series to
which the Futures Contract Option sold was specifically
allocated; (b) the type of Futures Contract Option (put or call);
(c) the type of Futures Contract and such other information as
may be necessary to identify the Futures Contract underlying the
Futures Contract Option; (d) the date of sale; (e) the sale
price; (f) the date of settlement; (g) the total amount payable
to the Fund for the account of such Series upon such sale; and
(h) the name of the broker or futures commission merchant through
which the sale was made. The Custodian shall consent to the
cancellation of the Futures Contract Option being closed against
payment to the Custodian of the total amount payable to the Fund
for the account of such Series, provided the same conforms to the
total amount payable as set forth in such Certificate.
3. Whenever a Futures Contract Option purchased by the
Fund pursuant to paragraph 1 is exercised by the Fund, the Fund
shall promptly deliver to the Custodian a Certificate specifying:
(a) the Series to which the Futures Contract Option exercised was
specifically allocated; (b) the particular Futures Contract
Option (put or call) being exercised; (c) the type of Futures
Contract underlying the Futures Contract Option; (d) the date of
exercise; (e) the name of the broker or futures commission
merchant through which the Futures Contract Option is exercised;
(f) the net total amount, if any, payable by the Fund; (g) the
amount, if any, to be received by the Fund for the account of
such Series; and (h) the amount of cash and/or the amount and
kind of Securities to be deposited in the Segregated Security
Account. The Custodian shall make the payments, if any, and the
deposits, if any, into the Segregated Security Account as
specified in the Certificate. The deposits, if any, to be made
to the Margin Account shall be made by the Custodian in
accordance with the terms and conditions of the Margin Account
Agreement.
4. Whenever the Fund writes a Futures Contract Option,
the Fund shall promptly deliver to the Custodian a Certificate
specifying with respect to such Futures Contract Option: (a) the
Series to which the Futures Contract Option written is to be
specifically allocated; (b) the type of Futures Contract Option
(put or call); (c) the type of Futures Contract and such other
information as may be necessary to identify the Futures Contract
underlying the Futures Contract Option; (d) the expiration date;
(e) the exercise price; (f) the premium to be received by the
Fund for the account of such Series; (g) the name of the broker
or futures commission merchant through which the premium is to be
received; and (h) the amount of cash and/or the amount and kind
of Securities, if any, to be deposited in the Segregated Security
Account. The Custodian shall, upon receipt of the premium
specified in the Certificate, make the deposits into the
Segregated Security Account, if any, as specified in the
Certificate. The deposits, if any, to be made to the Margin
Account shall be made by the Custodian in accordance with the
terms and conditions of the Margin Account Agreement.
5. Whenever a Futures Contract Option written by the
Fund which is a call is exercised, the Fund shall promptly
deliver to the Custodian a Certificate specifying: (a) the
Series to which the Futures Contract Option exercised was
specifically allocated; (b) the particular Futures Contract
Option exercised; (c) the type of Futures Contract underlying the
Futures Contract Option; (d) the name of the broker or futures
commission merchant through which such Futures Contract Option
was exercised; (e) the net total amount, if any, payable to the
Fund for the account of such Series upon such exercise; (f) the
net total amount, if any, payable by the Fund for the account of
such Series upon such exercise; and (g) the amount of cash and/or
the amount and kind of Securities to be deposited in the
Segregated Security Account. The Custodian shall, upon its
receipt of the net total amount payable to the Fund for the
account of such Series, if any, specified in such Certificate
make the payments, if any, and the deposits, if any, into the
Segregated Security Account as specified in the Certificate. The
deposits, if any, to be made to the Margin Account shall be made
by the Custodian in accordance with the terms and conditions of
the Margin Account Agreement.
6. Whenever a Futures Contract Option which is written
by the Fund and which is a Put Option is exercised, the Fund
shall promptly deliver to the Custodian a Certificate specifying:
(a) the Series to which the Futures Contract Option exercised was
specifically allocated; (b) the particular Futures Contract
Option exercised; (c) the type of Futures Contract underlying
such Futures Contract Option; (d) the name of the broker or
futures commission merchant through which such Futures Contract
Option is exercised; (e) the net total amount, if any, payable to
the Fund for the account of such Series upon such exercise; (f)
the net total amount, if any, payable by the Fund for the account
of such Series upon such exercise; and (g) the amount and kind of
Securities and/or cash to be withdrawn from or deposited in the
Segregated Security Account, if any. The Custodian shall, upon
its receipt of the net total amount payable to the Fund for the
account of such Series, if any, specified in the Certificate,
make the payments, if any, and the deposits, if any, into the
Segregated Security Account as specified in the Certificate. The
deposits to and/or withdrawals from the Margin Account, if any,
shall be made by the Custodian in accordance with the terms and
conditions of the Margin Account Agreement.
7. Whenever the Fund purchases any Futures Contract
Option identical to a previously written Futures Contract Option
described in this Article in order to liquidate its position as a
writer of such Futures Contract Option, the Fund shall promptly
deliver to the Custodian a Certificate specifying with respect to
the Futures Contract Option being purchased: (a) the Series to
which the Futures Contract Option purchased is to be specifically
allocated; (b) that the transaction is a closing transaction; (c)
the type of Futures Contract and such other information as may be
necessary to identify the Futures Contract underlying the Futures
Contract Option; (d) the exercise price; (e) the premium to be
paid by the Fund for the account of such Series; (f) the
expiration date; (g) the name of the broker or futures commission
merchant to which the premium is to be paid; and (h) the amount
of cash and/or the amount and kind of Securities, if any, to be
withdrawn from the Segregated Security Account. The Custodian
shall effect the withdrawals from the Segregated Security Account
specified in the Certificate. The withdrawals, if any, to be
made from the Margin Account shall be made by the Custodian in
accordance with the terms and conditions of the Margin Account
Agreement.
8. Upon the expiration or exercise of, or consummation
of a closing transaction with respect to, any Futures Contract
Option written or purchased by the Fund and described in this
Article, the Custodian shall (a) delete such Futures Contract
Option from the statements delivered to the Fund pursuant to
paragraph 3 of Article III herein, and (b) make such withdrawals
from, and/or, in the case of an exercise, such deposits into, the
Segregated Security Account as may be specified in a Certificate.
The deposits to and/or withdrawals from the Margin Account, if
any, shall be made by the Custodian in accordance with the terms
and conditions of the Margin Account Agreement.
9. Futures Contracts acquired by the Fund through the
exercise of a Futures Contract Option described in this Article
shall be subject to Article VI hereof.
ARTICLE VIII
SHORT SALES
1. Promptly after any short sale, the Fund shall
deliver to the Custodian a Certificate specifying: (a) the
Series to which the short sale is to be specifically allocated;
(b) the name of the issuer and the title of the Security; (c) the
number of shares or principal amount sold, and accrued interest
or dividends, if any; (d) the dates of the sale and settlement;
(e) the sale price per unit; (f) the total amount credited to the
Fund for the account of such Series upon such sales, if any; (g)
the amount of cash and/or the amount and kind of Securities, if
any, which are to be deposited in a Margin Account and the name
in which such Margin Account has been or is to be established;
(h) the amount of cash and/or the amount and kind of Securities,
if any, to be deposited in a Segregated Security Account; and (i)
the name of the broker through which such short sale was made.
The Custodian shall upon its receipt of a statement from such
broker confirming such sale and that the total amount credited to
the Fund upon such sale, if any, as specified in the Certificate
is held by such broker for the account of the Custodian (or any
nominee of the Custodian) as custodian of the Fund, issue a
receipt or make the deposits into the Margin Account and the
Segregated Security Account specified in the Certificate.
2. In connection with the closing-out of any short
sale, the Fund shall promptly deliver to the Custodian a
Certificate specifying with respect to each such closing-out:
(a) the Series to which the short sale being closed-out was
specifically allocated; (b) the name of the issuer and the title
of the Security; (c) the number of shares or the principal
amount, and accrued interest or dividends, if any, required to
effect such closing-out to be delivered to the broker; (d) the
dates of the closing-out and settlement; (e) the purchase price
per unit; (f) the net total amount payable to the Fund for the
account of such Series upon such closing-out; (g) the net total
amount payable to the broker upon such closing-out; (h) the
amount of cash and the amount and kind of Securities to be
withdrawn, if any, from the Margin Account; (i) the amount of
cash and/or the amount and kind of Securities, if any, to be
withdrawn from the Segregated Security Account; and (j) the name
of the broker through which the Fund is effecting such closing-
out. The Custodian shall, upon receipt of the net total amount
payable to the Fund for the account of such Series upon such
closing-out and the return and/or cancellation of the receipts,
if any, issued by the custodian with respect to the short sale
being closed-out, pay out of the moneys held for the account of
the Series to the broker the net total amount payable to the
broker, and make the withdrawals from the Margin Account and the
Segregated Security Account, as the same are specified in the
Certificate.
ARTICLE IX
REVERSE REPURCHASE AGREEMENTS
1. Promptly after the Fund, on behalf of a Series,
enters into a Reverse Repurchase Agreement with respect to
Securities and money held by the Custodian hereunder, the Fund
shall deliver to the Custodian a Certificate or in the event such
Reverse Repurchase Agreement is a Money Market Security, a
Certificate, Oral Instructions or Written Instructions
specifying: (a) the Series to which the Reverse Repurchase
Agreement is to be specifically allocated; (b) the total amount
payable to the Fund for the account of such Series in connection
with such Reverse Repurchase Agreement; (c) the broker or dealer
through or with which the Reverse Repurchase Agreement is
entered; (d) the amount and kind of Securities to be delivered by
the Fund to such broker or dealer; (e) the date of such Reverse
Repurchase Agreement; and (f) the amount of cash and/or the
amount and kind of Securities, if any, to be deposited in a
Segregated Security Account in connection with such Reverse
Repurchase Agreement. The Custodian shall, upon receipt of the
total amount payable to the Fund specified in the Certificate,
Oral Instructions or Written Instructions make the delivery to
the broker or dealer, and the deposits, if any, to the Segregated
Security Account, specified in such Certificate, Oral
Instructions or Written Instructions.
2. Upon the termination of a Reverse Repurchase
Agreement described in paragraph 1 of this Article, the Fund
shall promptly deliver a Certificate or, in the event such
Reverse Repurchase Agreement is a Money Market Security, a
Certificate, Oral Instructions or Written Instructions to the
Custodian specifying: (a) the Series to which the Reverse
Repurchase Agreement terminated was specifically allocated; (b)
the Reverse Repurchase Agreement being terminated; (c) the total
amount payable by the Fund for the account of such Series in
connection with such termination; (d) the amount and kind of
Securities to be received by the Fund for the account of such
Series in connection with such termination; (e) the date of
termination; (f) the name of the broker or dealer with or through
which the Reverse Repurchase Agreement is to be terminated; and
(g) the amount of cash and/or the amount and kind of Securities
to be withdrawn from the Segregated Security Account. The
Custodian shall, upon receipt of the amount and kind of
Securities to be received by the Fund specified in the
Certificate, Oral Instructions or Written Instructions, make the
payment to the broker or dealer, and the withdrawals, if any,
from the Segregated Security Account, specified in such
Certificate, Oral Instructions or Written Instructions.
ARTICLE X
CONCERNING MARGIN ACCOUNTS, SEGREGATED SECURITY
ACCOUNTS AND COLLATERAL ACCOUNTS
1. The Custodian shall, from time to time, make such
deposits to, or withdrawals from, a Segregated Security Account
as specified in a Certificate received by the Custodian. Such
Certificate shall specify the amount of cash and/or the amount
and kind of Securities to be deposited in, or withdrawn from, the
Segregated Security Account. In the event that the Fund fails to
specify in a Certificate the designated Series, the name of the
issuer, the title and the number of shares or the principal
amount of any particular Securities to be deposited by the
Custodian into, or withdrawn from, a Segregated Securities
Account, the Custodian shall be under no obligation to make any
such deposit or withdrawal and shall so notify the Fund.
2. The Custodian shall make deliveries or payments
from a Margin Account to the broker, dealer, futures commission
merchant or Clearing Member in whose name, or for whose benefit,
the account was established as specified in the Margin Account
Agreement.
3. Amounts received by the Custodian as payments or
distributions with respect to Securities deposited in any Margin
Account shall be dealt with in accordance with the terms and
conditions of the Margin Account Agreement.
4. The Custodian shall have a continuing lien and
security interest in and to any property at any time held by the
Custodian in any Collateral Account described herein. In
accordance with applicable law, the Custodian may enforce its
lien and realize on any such property whenever the Custodian has
made payment or delivery pursuant to any Put Option guarantee
letter or similar document or any receipt issued hereunder by the
Custodian. In the event the Custodian should realize on any such
property net proceeds which are less than the Custodian's
obligations under any Put Option guarantee letter or similar
document or any receipt, such deficiency shall be a debt owed the
Custodian by the Fund within the scope of Article XIII herein.
5. On each business day, the Custodian shall furnish
the Fund with respect to each Series a statement with respect to
each Margin Account in which money or Securities are held
specifying as of the close of business on the previous business
day: (a) the name of the Margin Account; (b) the amount and kind
of Securities held therein; and (c) the amount of money held
therein. The Custodian shall make available upon request to any
broker, dealer or futures commission merchant specified in the
name of a Margin Account a copy of the statement furnished the
Fund with respect to such Margin Account.
6. Promptly after the close of business on each
business day in which cash and/or Securities are maintained in a
Collateral Account, the Custodian shall furnish the Fund with a
Statement with respect to such Collateral Account specifying the
amount of cash and/or the amount and kind of Securities held
therein. No later than the close of business next succeeding the
delivery to the Fund of such statement, the Fund shall furnish to
the Custodian a Certificate or Written Instructions specifying
the then market value of the securities described in such
statement. In the event such then market value is indicated to
be less than the Custodian's obligation with respect to any
outstanding Put Option, guarantee letter or similar document, the
Fund shall promptly specify in a Certificate the additional cash
and/or Securities to be deposited in such Collateral Account to
eliminate such deficiency.
ARTICLE XI
PAYMENT OF DIVIDENDS OR DISTRIBUTIONS
1. For each Series, the Fund shall furnish to the
Custodian a copy of the resolution of the Fund's Board, certified
by the Secretary or any Assistant Secretary, either (i) setting
forth the date of the declaration of a dividend or distribution,
the date of payment thereof, the record date as of which
shareholders entitled to payment shall be determined, the amount
payable per share to the shareholders of record as of that date
and the total amount payable to the Dividend Agent of the Fund on
the payment date, or (ii) authorizing the declaration of
dividends and distributions on a daily basis and authorizing the
Custodian to rely on Oral Instructions, Written Instructions or a
Certificate setting forth the date of the declaration of such
dividend or distribution, the date of payment thereof, the record
date as of which shareholders entitled to payment shall be
determined, the amount payable per share to the shareholders of
record as of that date and the total amount payable to the
Dividend Agent on the payment date.
2. Upon the payment date specified in such resolution,
Oral Instructions, Written Instructions or Certificate, as the
case may be, the Custodian shall pay out of the moneys held for
the account of the Series the total amount payable to the
Dividend Agent of the Fund.
ARTICLE XII
SALE AND REDEMPTION OF SHARES
1. Whenever the Fund shall sell any Series' Shares,
the Fund shall deliver to the Custodian a Certificate duly
specifying:
(a) The number of Shares sold, trade date, and price;
and
(b) The amount of money to be received by the
Custodian for the sale of such Shares.
2. Upon receipt of such money from the Transfer Agent,
the Custodian shall credit such money to the account of such
Series.
3. Upon issuance of any Series' Shares in accordance
with the foregoing provisions of this Article, the Custodian
shall pay, out of the money held for the account of such Series,
all original issue or other taxes required to be paid by the Fund
for the account of such Series in connection with such issuance
upon the receipt of a Certificate specifying the amount to be
paid.
4. Except as provided hereinafter, whenever the Fund
shall hereafter redeem any Series' Shares, the Fund shall furnish
to the Custodian a Certificate specifying:
(a) The number of Shares redeemed; and
(b) The amount to be paid for the Shares redeemed.
5. Upon receipt from the Transfer Agent of an advice
setting forth the number of a Series' Shares received by the
Transfer Agent for redemption and that such Shares are valid and
in good form for redemption, the Custodian shall make payment to
the Transfer Agent out of the moneys held for the account of such
Series of the total amount specified in the Certificate issued
pursuant to the foregoing paragraph 4 of this Article.
Notwithstanding the above provisions regarding the
redemption of any of Series' Shares, whenever a Series' Shares
are redeemed pursuant to any check redemption privilege which may
from time to time be offered by the Fund, the Custodian, unless
otherwise instructed by a Certificate, shall, upon receipt of an
advice from the Fund or its agent setting forth that the
redemption is in good form for redemption in accordance with the
check redemption procedure, honor the check presented as part of
such check redemption privilege out of the money held in the
account of the Fund for such purposes.
ARTICLE XIII
OVERDRAFTS OR INDEBTEDNESS
1. If the Custodian should in its sole discretion
advance funds on behalf of a Series which results in an overdraft
because the moneys held by the Custodian for the account of such
Series shall be insufficient to pay the total amount payable upon
a purchase of Securities as set forth in a Certificate or Oral
Instructions issued pursuant to Article IV, or which results in
an overdraft in the account for such Series for some other
reason, or if a Series is for any other reason indebted to the
Custodian (except a borrowing for investment or for temporary or
emergency purposes using Securities as collateral pursuant to a
separate agreement and subject to the provisions of paragraph 2
of this Article XIII), such overdraft or indebtedness shall be
deemed to be a loan made by the Custodian to such Series payable
on demand and shall bear interest from the date incurred at a
rate per annum (based on a 360-day year for the actual number of
days involved) equal to the Federal Funds Rate plus l/2%, such
rate to be adjusted on the effective date of any change in such
Federal Funds Rate but in no event to be less than 6% per annum,
except that any overdraft resulting from an error by the
Custodian shall bear no interest. Any such overdraft or
indebtedness shall be reduced by an amount equal to the total of
all amounts due such Series which have not been collected by the
Custodian on behalf of such Series when due because of the
failure of the Custodian to make timely demand or presentment for
payment. In addition, the Fund hereby agrees that the Custodian
shall have a continuing lien and security interest in and to any
property at any time held by it for the benefit of such Series or
in which such Series may have an interest which is then in the
Custodian's possession or control or in possession or control of
any third party acting in the Custodian's behalf. The Fund
authorizes the Custodian, in its sole discretion, at any time to
charge any such overdraft or indebtedness together with interest
due thereon against any balance of account standing to such
Series' credit on the Custodian's books. For purposes of this
Section 1 of Article XIII, "overdraft" shall mean a negative
Available Balance.
2. The Fund will cause to be delivered to the
Custodian by any bank (including, if the borrowing is pursuant to
a separate agreement, the Custodian) from which it borrows money
for investment or for temporary or emergency purposes using
Securities in a Series' portfolio as collateral for such
borrowings, a notice or undertaking in the form currently
employed by any such bank setting forth the amount which such
bank will loan to the Fund against delivery of a stated amount of
collateral. The Fund shall promptly deliver to the Custodian a
Certificate specifying with respect to each such borrowing: (a)
the Series to which the borrowing relates; (b) the name of the
bank; (c) the amount and terms of the borrowing, which may be set
forth by incorporating by reference an attached promissory note,
duly endorsed by the Fund, or other loan agreement; (d) the time
and date, if known, on which the loan is to be entered into; (e)
the date on which the loan becomes due and payable; (f) the total
amount payable to the Fund for the account of such Series on the
borrowing date; (g) the market value of Securities to be
delivered as collateral for such loan, including the name of the
issuer, the title and the number of shares or the principal
amount of any particular Securities; and (h) a statement
specifying whether such loan is for investment purposes or for
temporary or emergency purposes and that such loan is in
conformance with the Investment Company Act of 1940, as amended,
and the Fund's prospectus. The Custodian shall deliver on the
borrowing date specified in a Certificate the specified
collateral and the executed promissory note, if any, against
delivery by the lending bank of the total amount of the loan
payable, provided that the same conforms to the total amount
payable as set forth in the Certificate. The Custodian may, at
the option of the lending bank, keep such collateral in its
possession, but such collateral shall be subject to all rights
therein given the lending bank by virtue of any promissory note
or loan agreement. The Custodian shall deliver such Securities
as additional collateral as may be specified in a Certificate to
collateralize further any transaction described in this para-
graph. The Fund shall cause all Securities released from
collateral status to be returned directly to the Custodian, and
the Custodian shall receive from time to time such return of
collateral as may be tendered to it. In the event that the Fund
fails to specify in a Certificate the Series, the name of the
issuer, the title and number of shares or the principal amount of
any particular Securities to be delivered as collateral by the
Custodian, the Custodian shall not be under any obligation to
deliver any Securities.
ARTICLE XIV
LOAN OF PORTFOLIO SECURITIES OF THE FUND
1. If the Fund is permitted by the terms of its
organization documents and as disclosed in its most recent and
currently effective prospectus to lend the portfolio Securities
of a Series, within 24 hours after each loan of portfolio
Securities the Fund shall deliver or cause to be delivered to the
Custodian a Certificate specifying with respect to each such
loan: (a) the Series to which the Securities to be loaned are
specifically allocated; (b) the name of the issuer and the title
of the Securities; (c) the number of shares or the principal
amount loaned; (d) the date of loan and delivery; (e) the total
amount to be delivered to the Custodian against the loan of the
Securities, including the amount of cash collateral and the
premium, if any, separately identified; and (f) the name of the
broker, dealer or financial institution to which the loan was
made. The Custodian shall deliver the Securities thus designated
to the broker, dealer or financial institution to which the loan
was made upon receipt of the total amount designated as to be
delivered against the loan of Securities. The Custodian may
accept payment in connection with a delivery otherwise than
through the Book-Entry System or Depository only in the form of a
certified or bank cashier's check payable to the order of the
Fund or the Custodian drawn on New York Clearing House funds and
may deliver Securities in accordance with the customs prevailing
among dealers in securities.
2. Promptly after each termination of the loan of
Securities by the Fund, the Fund shall deliver or cause to be
delivered to the Custodian a Certificate specifying with respect
to each such loan termination and return of Securities: (a) the
Series to which the Securities to be returned are specifically
allocated; (b) the name of the issuer and the title of the
Securities to be returned; (c) the number of shares or the
principal amount to be returned; (d) the date of termination;
the total amount to be delivered by the Custodian (including the
cash collateral for such Securities minus any offsetting credits
as described in said Certificate); and (f) the name of the
broker, dealer or financial institution from which the Securities
will be returned. The Custodian shall receive all Securities
returned from the broker, dealer, or financial institution to
which such Securities were loaned and upon receipt thereof shall
pay, out of the moneys held for the account of the Series
specified in the Certificate, the total amount payable upon such
return of Securities as set forth in the Certificate.
ARTICLE XV
RECORDKEEPING AND FUND ACCOUNTING
1. The Custodian shall compute the net asset value per
share and offering price per share of each Series at such times
and dates and in the manner specified in the Prospectus. The
Custodian also shall compute the net income and capital gains of
each Series for dividend purposes and the net income and capital
gains per share at such times and dates and in the manner
specified in the Prospectus. The Custodian shall advise the Fund
and its transfer agent, of the net asset value and offering price
per share, the net income and capital gains and the net income
and capital gains per share of each Series upon completion of the
computations required to be made by the Custodian pursuant to
this Article.
2. Securities of each Series shall be valued as set
forth in the Prospectus and the Fund shall have sole
responsibility for determining the method of valuation of a
Series' Securities. To the extent valuation of a Series'
Securities on such basis is at any time inconsistent with any
applicable laws and/or regulations, the Fund, or its authorized
agent, shall immediately so notify the Custodian in writing and
thereafter shall either furnish the Custodian at all appropriate
times with the values of such Securities or, subject to the prior
approval of the Custodian, instruct the Custodian in writing to
value such Series' Securities in a manner which the Fund, or its
authorized agent, then represents in writing to be consistent
with all applicable laws and regulations.
3. The Fund, or its authorized agent, from time to
time, may instruct the Custodian in writing to compute the value
of the Securities of a Series, such Series' net asset value and
offering price per share, the net income and capital gains of
such Series, or the net income and capital gains per share of
such Series in a manner other than as specified in the preceding
paragraphs of this Article; provided, however, that any such
other methods of computation shall not be inconsistent with any
applicable laws and regulations.
4. The Fund, or its authorized agent, shall furnish
the Custodian with any and all instructions, explanations,
information, specifications and documentation deemed necessary by
the Custodian in the performance of its duties set forth under
this Article, including, without limitation, the amounts, and/or
written formula for calculating the amounts, and times of accrual
of each Series' liabilities and expenses. The Fund, or its
authorized agent, also shall from time to time furnish the
Custodian with bid, offer, and/or market values of the securities
held by each Series if the same are not available to the
Custodian from a security pricing or similar service utilized, or
subscribed to, by the Custodian at the time such information is
required for calculations set forth under this Article, and if
any broker or other third party selected by the Fund is unable to
readily obtain market quotations with respect to such securities
from the appropriate securities exchange, NASDAQ service or other
similar wire service. At no time shall the Custodian be required
or obligated to commence or maintain any utilization of, or
subscriptions to, any securities pricing or similar service
except those of its own choosing sufficient to permit it to
perform its duties set forth under this Article; provided that
the Custodian shall neither use any security pricing or similar
service, nor shall it discontinue its use of any such service, in
connection with the performance of its services under this
Article except upon adequate prior written notice to the Fund.
Any specifications of the assets of a Series given to the
Custodian by the Fund or its authorized agent, and any changes in
such specifications, including, without limitation, any additions
thereto or deletions therefrom, shall be signed by two Officers.
5. The Custodian shall maintain and keep current the
books, accounts and other documents, if any, listed in Appendix E
hereto and made a part hereof, as such Appendix E may be amended
from time to time, and shall preserve any such books, accounts
and other documents in accordance with the applicable provisions
of the Investment Company Act of 1940, as amended, in particular,
Section 31 thereof and Rules 31a-1 and 31a-2 thereunder, and
other applicable securities laws and rules and regulations. All
records maintained and preserved by the Custodian pursuant to
this Article which the Fund is required to maintain and preserve
in accordance with such rules shall be and remain the property of
the Fund and shall be surrendered to the Fund promptly upon
request in the form in which such records have been maintained
and preserved.
6. The Custodian, in performing the services required
of it under the terms of this Article, shall be entitled to rely
fully on the accuracy and validity of any and all instructions,
explanations, information, specifications and documentation
furnished to it by the Fund or its authorized agent and shall
have no duty or obligation to review the accuracy, validity or
propriety of such instructions, explanations, information,
specifications or documentation, including, without limitation,
evaluations of Securities held as part of the Fund's Series; the
amounts and/or formula for calculating the amounts and times of
accrual of a Series' liabilities and expenses; the amounts
receivable and the amounts payable on the sale or purchase of the
portfolio Securities of a Series; and amounts receivable or
amounts payable for the sale or redemption of Shares effected by
or on behalf of the Fund, provided that the Custodian shall be
fully responsible for the accuracy and validity of any and all
instructions, explanations, information, specifications and
documentation furnished by itself in connection with the
performance of its duties hereunder. In the event the
Custodian's computations hereunder require information,
including, without limitation, bid, offer and/or market values of
Securities or other assets, or accruals of interest or earnings
thereon, furnished to the Custodian by a pricing or similar
service utilized or subscribed to by the Custodian which the
Custodian in its judgment deems reliable and which has been
previously approved in writing by the Fund, or by a broker or
other third party selected by the Fund, the Custodian shall not
be responsible for, under any duty to inquire into, or deemed to
make any assurances with respect to, the accuracy or completeness
of such information; provided that the Custodian shall not waive,
release, or give up the respective rights, if any, of the Fund to
obtain recovery from any such service for any loss suffered by
the Fund as a result of the negligence of such service. The
Custodian shall not be obligated or expected to obtain from any
pricing or similar service, or any third party, any rights in
addition to the rights, if any, such pricing, similar service or
third party generally provides under its typical agreement;
provided, however, that the Custodian may execute any such
typical agreement in connection with its obtaining such services
that includes as a standard provision limitations and waivers of
any or all such rights.
ARTICLE XVI
CONCERNING THE CUSTODIAN
1. Except as hereinafter provided, neither the
Custodian nor its nominee shall be liable for any loss or damage,
including counsel fees, resulting from its action or omission to
act or otherwise, either hereunder or under any Margin Account
Agreement, except for any such loss or damage arising out of its
own negligence or willful misconduct. The Custodian may, with
respect to questions of law arising hereunder or under any Margin
Account Agreement, apply for and obtain the advice and opinion of
counsel to the Fund or of its own counsel, at the expense of the
Fund, and shall be fully protected with respect to anything done
or omitted by it in good faith in conformity with such advice or
opinion. The Custodian shall be liable to the Fund for any loss
or damage resulting from the use of the Book-Entry System or any
Depository arising by reason of any negligence, misfeasance or
willful misconduct on the part of the Custodian or any of its
employees or agents.
2. Without limiting the generality of the foregoing,
the Custodian shall be under no obligation to inquire into, and
shall not be liable for:
(a) The validity of the issue of any Securities
purchased, sold or written by or for the Fund, the legality of
the purchase, sale or writing thereof, or the propriety of the
amount paid or received therefor;
(b) The legality of the issue or sale of any of the
Fund's Shares, or the sufficiency of the amount to be received
therefor;
(c) The legality of the redemption of any of the
Fund's Shares, or the propriety of the amount to be paid
therefor;
(d) The legality of the declaration or payment of any
dividend by the Fund;
(e) The legality of any borrowing by the Fund using
Securities as collateral;
(f) The legality of any loan of portfolio Securities
pursuant to Article XIV of this Agreement, nor shall the
Custodian be under any duty or obligation to see to it that any
cash collateral delivered to it by a broker, dealer or financial
institution or held by it at any time as a result of such loan of
portfolio Securities of the Fund is adequate collateral for the
Fund against any loss it might sustain as a result of such loan.
The Custodian specifically, but not by way of limitation, shall
not be under any duty or obligation periodically to check or
notify the Fund that the amount of such cash collateral held by
it for the Fund is sufficient collateral for the Fund, but such
duty or obligation shall be the sole responsibility of the Fund.
In addition, the Custodian shall be under no duty or obligation
to see that any broker, dealer or financial institution to which
portfolio Securities of the Fund are lent pursuant to Article XIV
of this Agreement makes payment to it of any dividends or
interest which are payable to or for the account of the
applicable Series of the Fund during the period of such loan or
at the termination of such loan, provided, however, that the
Custodian shall promptly notify the Fund in the event that such
dividends or interest are not paid and received when due; or
(g) The sufficiency or value of any amounts of money
and/or Securities held in any Margin Account, Segregated Security
Account or Collateral Account in connection with transactions by
the Fund. In addition, the Custodian shall be under no duty or
obligation to see that any broker, dealer, futures commission
merchant or Clearing Member makes payment to the Fund of any
variation margin payment or similar payment which the Fund may be
entitled to receive from such broker, dealer, futures commission
merchant or Clearing Member, to see that any payment received by
the Custodian from any broker, dealer, futures commission
merchant or Clearing Member is the amount the Fund is entitled to
receive, or to notify the Fund of the Custodian's receipt or non-
receipt of any such payment; provided however that the Custodian,
upon the Fund's written request, shall, as Custodian, demand from
any broker, dealer, futures commission merchant or Clearing
Member identified by the Fund the payment of any variation margin
payment or similar payment that the Fund asserts it is entitled
to receive pursuant to the terms of a Margin Account Agreement or
otherwise from such broker, dealer, futures commission merchant
or Clearing Member.
3. The Custodian shall not be liable for, or
considered to be the Custodian of, any money, whether or not
represented by any check, draft or other instrument for the
payment of money, received by it on behalf of the Fund until the
Custodian actually receives and collects such money directly or
by the final crediting of the account representing the Fund's
interest at the Book-Entry System or the Depository.
4. The Custodian shall have no responsibility and
shall not be liable for ascertaining or acting upon any calls,
conversions, exchange, offers, tenders, interest rate changes or
similar matters relating to Securities held in the Depository,
unless the Custodian shall have actually received timely notice
from the Depository. In no event shall the Custodian have any
responsibility or liability for the failure of the Depository to
collect, or for the late collection or late crediting by the
Depository of any amount payable upon Securities deposited in the
Depository which may mature or be redeemed, retired, called or
otherwise become payable. However, upon receipt of a Certificate
from the Fund of an overdue amount on Securities held in the
Depository, the Custodian shall make a claim against the
Depository on behalf of the Fund, except that the Custodian shall
not be under any obligation to appear in, prosecute or defend any
action, suit or proceeding in respect to any Securities held by
the Depository which in its opinion may involve it in expense or
liability, unless indemnity satisfactory to it against all
expense and liability be furnished as often as may be required.
5. The Custodian shall not be under any duty or
obligation to take action to effect collection of any amount due
to the Fund from the Transfer Agent of the Fund nor to take any
action to effect payment or distribution by the Transfer Agent of
the Fund of any amount paid by the Custodian to the Transfer
Agent of the Fund in accordance with this Agreement.
6. The Custodian shall not be under any duty or
obligation to take action to effect collection of any amount, if
the Securities upon which such amount is payable are in default,
or if payment is refused after due demand or presentation, unless
and until (i) it shall be directed to take such action by a
Certificate and (ii) it shall be assured to its satisfaction of
reimbursement of its costs and expenses in connection with any
such action.
7. The Custodian may appoint one or more banking
institutions as Depository or Depositories or as Sub-Custodian or
Sub-Custodians, including, but not limited to, banking
institutions located in foreign countries, of Securities and
moneys at any time owned by the Fund, upon terms and conditions
approved in the Certificate, which shall, if requested by the
Custodian, be accompanied by an approving resolution of the
Fund's Board adopted in accordance with Rule 17f-5 under the
Investment Company Act of 1940, as amended. Notwithstanding
anything to the contrary contained in this Agreement, the
Custodian shall hold harmless and indemnify the Fund from and
against any losses, actions, claims, demands, expenses and
proceedings, including counsel fees, that occur as a result of
any act or omission of any Foreign Sub-Custodian or Depository
with respect to the safekeeping of moneys and securities of the
Fund.
8. The Custodian shall not be under any duty or
obligation to ascertain whether any Securities at any time
delivered to or held by it for the account of the Fund are such
as properly may be held by the Fund under the provisions of its
organization documents.
9. (a) The Custodian shall be entitled to receive and
the Fund agrees to pay to the Custodian all reasonable out-of-
pocket expenses and such compensation and fees as are specified
on Schedule A hereto. The Custodian shall not deem amounts
payable in respect of foreign custodial services to be out-of-
pocket expenses, it being the parties' intention that all fees
for such services shall be as set forth on Schedule B hereto and
shall be provided for the term of this Agreement without any
automatic or unilateral increase. The Custodian shall have the
right to unilaterally increase the figures on Schedule A on or
after _______, 1995 and on or after each succeeding ____________
thereafter by an amount equal to 50% of the increase in the
Consumer Price Index for the calendar year ending on the
December 31 immediately preceding the calendar year in which such
occurs, provided, however, that during each such annual
period commencing on a ____________________, the aggregate
increase during such period shall not be in excess of 10%. Any
increase by the Custodian shall be specified in a written notice
delivered to the Fund at least thirty days prior to the effective
date of the increase. The Custodian may charge such compensation
and any expenses incurred by the Custodian in the performance of
its duties pursuant to such agreement against any money held by
it for the account of the Fund. The Custodian shall also be
entitled to charge against any money held by it for the account
of the Fund the amount of any loss, damage, liability or expense,
including counsel fees, for which it shall be entitled to
reimbursement under the provisions of this Agreement. The
expenses which the Custodian may charge against the account of
the Fund include, but are not limited to, the expenses of Sub-
Custodians and foreign branches of the Custodian incurred in
settling outside of New York City transactions involving the
purchase and sale of Securities of the Fund.
(b) The Fund shall receive a credit for each
calendar month against such compensation and fees of the
Custodian as may be payable by the Fund with respect to such
calendar month in an amount equal to the aggregate of its
Earnings Credit for such calendar month. In no event may any
Earnings Credits be carried forward to any fiscal year other than
the fiscal year in which it was earned, or, unless permitted by
applicable law, transferred to, or utilized by, any other person
or entity, provided that any such transferred Earnings Credit can
be used only to offset compensation and fees of the Custodian for
services rendered to such transferee and cannot be used to pay
the Custodian's out-of-pocket expenses. For purposes of this
sub-section (b), the Fund is permitted to transfer Earnings
Credits only to The First National Bank of Chicago, its
affiliates and/or any investment company now or in the future for
which The First National Bank of Chicago, or any of its
affiliates acts as investment adviser. For purposes of this sub-
section (b), a fiscal year shall mean the twelve-month period
commencing on the effective date of this Agreement and on each
anniversary thereof.
10. The Custodian shall be entitled to rely upon any
Certificate, notice or other instrument in writing received by
the Custodian and reasonably believed by the Custodian to be a
Certificate. The Custodian shall be entitled to rely upon any
Oral Instructions and any Written Instructions actually received
by the Custodian pursuant to Article IV or XI hereof. The Fund
agrees to forward to the Custodian a Certificate or facsimile
thereof, confirming such Oral Instructions or Written
Instructions in such manner so that such Certificate or facsimile
thereof is received by the Custodian, whether by hand delivery,
telex or otherwise, by the close of business of the same day that
such Oral Instructions or Written Instructions are given to the
Custodian. The Fund agrees that the fact that such confirming
instructions are not received by the Custodian shall in no way
affect the validity of the transactions or enforceability of the
transactions hereby authorized by the Fund. The Fund agrees that
the Custodian shall incur no liability to the Fund in acting upon
Oral Instructions given to the Custodian hereunder concerning
such transactions, provided such instructions reasonably appear
to have been received from an Authorized Person.
11. The Custodian shall be entitled to rely upon any
instrument, instruction or notice received by the Custodian and
reasonably believed by the Custodian to be given in accordance
with the terms and conditions of any Margin Account Agreement.
Without limiting the generality of the foregoing, the Custodian
shall be under no duty to inquire into, and shall not be liable
for, the accuracy of any statements or representations contained
in any such instrument or other notice including, without
limitation, any specification of any amount to be paid to a
broker, dealer, futures commission merchant or Clearing Member.
12. The books and records pertaining to the Fund which
are in the possession of the Custodian shall be the property of
the Fund. Such books and records shall be prepared and
maintained as required by the Investment Company Act of 1940, as
amended, and other applicable securities laws and rules and
regulations. The Fund, or the Fund's authorized representatives,
shall have access to such books and records during the
Custodian's normal business hours. Upon the reasonable request
of the Fund, copies of any such books and records shall be
provided by the Custodian to the Fund or the Fund's authorized
representative at the Fund's expense.
13. The Custodian shall provide the Fund with any
report obtained by the Custodian on the system of internal
accounting control of the Book-Entry System or the Depository, or
O.C.C., and with such reports on its own systems of internal
accounting control as the Fund may reasonably request from time
to time.
14. The Fund agrees to indemnify the Custodian against
and save the Custodian harmless from all liability, claims,
losses and demands whatsoever, including attorney's fees,
howsoever arising or incurred because of or in connection with
the Custodian's payment or non-payment of checks pursuant to
paragraph 6 of Article XII as part of any check redemption
privilege program of the Fund, except for any such liability,
claim, loss and demand arising out of the Custodian's own
negligence or willful misconduct.
15. Subject to the foregoing provisions of this
Agreement, the Custodian may deliver and receive Securities, and
receipts with respect to such Securities, and arrange for
payments to be made and received by the Custodian in accordance
with the customs prevailing from time to time among brokers or
dealers in such Securities.
16. The Custodian shall have no duties or responsi-
bilities whatsoever except such duties and responsibilities as
are specifically set forth in this Agreement, and no covenant or
obligation shall be implied in this Agreement against the
Custodian.
ARTICLE XVII
TERMINATION
1. (a) Any termination may be effected only by the
terminating party giving to the other party a notice in writing
specifying the date of such termination, which shall be not less
than two hundred seventy (270) days after the date of giving of
such notice.
(b) The Fund may at any time terminate this
Agreement if the Custodian has materially breached its
obligations under this Agreement and such breach has remained
uncured for a period of thirty days after the Custodian's receipt
from the Fund of written notice specifying such breach.
(c) Either party, immediately upon written notice
to the other party, may terminate this Agreement upon the Merger
or Bankruptcy of the other party.
In the event notice of termination is given by the
Fund, it shall be accompanied by a copy of a resolution of the
Fund's Board, certified by the Secretary or any Assistant
Secretary, electing to terminate this Agreement and designating a
successor custodian or custodians, each of which shall be a bank
or trust company having not less than $2,000,000 aggregate
capital, surplus and undivided profits. In the event notice of
termination is given by the Custodian, the Fund shall, on or
before the termination date, deliver to the Custodian a copy of a
resolution of its Board, certified by the Secretary or any
Assistant Secretary, designating a successor custodian or
custodians. In the absence of such designation by the Fund, the
Custodian may designate a successor custodian which shall be a
bank or trust company having not less than $2,000,000 aggregate
capital, surplus and undivided profits. Upon the date set forth
in such notice, this Agreement shall terminate and the Custodian
shall, upon receipt of a notice of acceptance by the successor
custodian, on that date deliver directly to the successor
custodian all Securities and moneys then owned by the Fund and
held by it as Custodian, after deducting all fees, expenses and
other amounts for the payment or reimbursement of which it shall
then be entitled.
2. If a successor custodian is not designated by the
Fund or the Custodian in accordance with the preceding paragraph,
the Fund shall, upon the date specified in the notice of
termination of this Agreement and upon the delivery by the
Custodian of all Securities (other than Securities held in the
Book-Entry System which cannot be delivered to the Fund) and
moneys then owned by the Fund, be deemed to be its own custodian,
and the Custodian shall thereby be relieved of all duties and
responsibilities pursuant to this Agreement, other than the duty
with respect to Securities held in the Book-Entry System, in any
Depository or by a Clearing Member which cannot be delivered to
the Fund, to hold such Securities hereunder in accordance with
this Agreement.
ARTICLE XVIII
MISCELLANEOUS
1. Annexed hereto as Appendix A is a Certificate
setting forth the names of the present Authorized Persons. The
Fund agrees to furnish to the Custodian a new Certificate in
similar form in the event that any such present Authorized Person
ceases to be an Authorized Person or in the event that other or
additional Authorized Persons are elected or appointed. Until
such new Certificate shall be received, the Custodian shall be
fully protected in acting under the provisions of this Agreement
upon Oral Instructions or signatures of the present Authorized
Persons as set forth in the last delivered Certificate.
2. Annexed hereto as Appendix B is a Certificate
signed by two of the present Officers of the Fund setting forth
the names of the present Officers of the Fund. The Fund agrees
to furnish to the Custodian a new Certificate in similar form in
the event any such present Officer ceases to be an Officer of the
Fund, or in the event that other or additional Officers are
elected or appointed. Until such new Certificate shall be
received, the Custodian shall be fully protected in acting under
the provisions of this Agreement upon the signatures of the
Officers as set forth in the last delivered Certificate.
3. Any notice or other instrument in writing,
authorized or required by this Agreement to be given to the
Custodian, shall be sufficiently given if addressed to the
Custodian and mailed or delivered to it at its offices at 110
Washington Street, 13th Floor, New York, New York 10286, or at
such other place as the Custodian may from time to time designate
in writing.
4. Any notice or other instrument in writing,
authorized or required by this Agreement to be given to the Fund,
shall be sufficiently given if addressed to the Fund and mailed
or delivered to it at its offices at 125 West 55th Street, New
York, New York 10019, or at such other place as the Fund may from
time to time designate in writing.
5. This Agreement may not be amended or modified in
any manner except by a written agreement executed by both parties
with the same formality as this Agreement and approved by a
resolution of the Fund's Board.
6. This Agreement shall extend to and shall be binding
upon the parties hereto, and their respective successors and
assigns; provided, however, that this Agreement shall not be
assignable by the Fund without the written consent of the
Custodian, or by the Custodian without the written consent of the
Fund, authorized or approved by a resolution of its Board.
7. This Agreement shall be construed in accordance
with the laws of the State of New York.
8. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original,
but such counterparts shall, together, constitute only one
instrument.
9. This Agreement has been executed on behalf of the
Fund by the undersigned officer of the Fund in his capacity as an
officer of the Fund. The obligations of this Agreement shall
only be binding upon the assets and property of the Fund and
shall not be binding upon any Board member, officer or
shareholder of the Fund individually.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective Officers, thereunto
duly authorized, as of the day and year first above written.
PRAIRIE FUNDS
By:
Attest:
THE BANK OF NEW YORK
By:
Attest:
<PAGE>
Appendix A
AUTHORIZED SIGNATORIES
<PAGE>
Appendix B
The undersigned Officers of the Fund do hereby certify
that the following individuals, whose specimen signatures are on
file with The Bank of New York, have been duly elected or
appointed by the Fund's Board to the position set forth opposite
their names and have qualified therefor:
Name Position
Joseph F. Kissel President
Ann E. Bergin Vice President
Stephen A. Smith Vice President
Richard A. Fabietti Treasurer
Martin G. Flanigan Assistant Treasurer
James W. Bernaiche Secretary
Anne E. Bergin, James W. Bernaiche,
Vice President Secretary
<PAGE>
Appendix C
The following are designated publications for purposes
of paragraph 5(b) of Article III:
The Bond Buyer
Depository Trust Company Notices
Financial Daily Card Service
The New York Times
Standard & Poor's Called Bond Record
The Wall Street Journal
<PAGE>
Appendix D
Name of Series
Prairie Funds:
Bond Fund
Equity Income Fund
Growth Fund
Intermediate Municipal Bond Fund
International Bond Fund
International Equity Fund
Managed Assets Fund
Managed Assets Income Fund
Money Market Fund
Municipal Money Market Fund
Special Opportunities Fund
<PAGE>
Schedule A
The fees payable to the Custodian with respect to
securities held in domestic custody are annexed hereto.
<PAGE>
Schedule B
The fees payable to the Custodian with respect to
securities held in foreign custody are annexed hereto.
<PAGE>
Appendix E
CUSTODY AND FUND ACCOUNTING AGREEMENT
I. The Bank of New York, as agent (the "Bank") shall
maintain the following records.
1. General Ledger
2. General Journal
3. Cash Receipts Journal
4. Cash Disbursements Journal
5. Subscriptions Journal
6. Redemptions Journal
7. Accounts Receivable Reports/Portfolio Sales
Dividend/Interest/Subscriptions
8. Accounts Payable Reports/Portfolio
Purchase/Liquidation
9. Transaction (Securities) Journal/Portfolio
Purchases and Sales
10. Broker Commission Ledger
11. Broker Commission by Trade Ledger
12. Security Ledger
PORTFOLIO ACCOUNTING AND GENERAL LEDGER SERVICES
* Daily pricing.
* Computation of daily net asset value and reporting
to transfer agent, fund management, NASDAQ and
others as requested.
* Prepare daily cash availability report for
portfolio managers.
* Daily posting of all Fund activity and preparation
of all applicable daily reports.
* Accrue expenses daily.
* Daily reconciliation of cash, receivable, payable
accounts and shares outstanding.
* Compute daily dividend rates for appropriate
funds.
* Compute yields for money market and fixed income
funds pursuant to S.E.C. formulas.
* Prepare mark to market reports for money market
funds.
* Monthly analysis and reconciliation of all general
ledger accounts.
* Generate and maintain monthly broker ledgers,
commission ledgers and net trade reports.
* Verify accuracy and propriety of bills and
invoices, maintain expense files and coordinate
the payment of bills and invoices in a timely
manner.
* Prepare report on expense limitation as needed.
* Maintain and verify portfolio trade tickets with
broker confirmations.
* Determine income available for monthly, quarterly
and/or annual dividend/distribution.
* Maintain historical record of all fund net asset
values and dividends/distributions.
* Coordinate audit examination by outside auditors,
including preparation of audit workpaper package.
* Produce documents and respond to inquires during
S.E.C. audits.
<PAGE>
EXHIBIT 9(a)
ADMINISTRATION AGREEMENT
PRAIRIE FUNDS
125 West 55th Street
New York, New York 10019
November 18, 1994
First Chicago Investment
Management Company
Three First National Plaza
Chicago, Illinois 60670
Dear Sirs:
The above-named investment company (the "Fund")
consisting of the series named on Schedule 1 hereto, as such
Schedule may be revised from time to time (each, a "Series"),
herewith confirms its agreement with you as follows:
The Fund desires to employ its capital by investing and
reinvesting the same in investments of the type and in accordance
with the limitations specified in its charter documents and in
its Prospectus and Statement of Additional Information as from
time to time in effect, copies of which have been or will be
submitted to you, and in such manner and to such extent as from
time to time may be approved by the Fund's Board. The Fund
desires to employ you to act as its administrator.
In this connection it is understood that from time to
time you will employ or associate with itself such person or
persons as you may believe to be particularly fitted to assist it
in the performance of this Agreement. Such person or persons may
be officers or employees who are employed by both you and the
Fund. The compensation of such person or persons shall be paid
by you and no obligation may be incurred on the Fund's behalf in
any such respect. We have discussed and concur in your employing
on this basis Concord Holding Corporation (the "Sub-
Administrator").
Pursuant to this agreement and subject to the
supervision and control of the Fund's Board, you will assist in
supervising all aspects of the Fund's operations, except
investment management of the Series' portfolios. It is
understood that, pursuant to this Agreement, you shall not act
and shall not be required to act as an investment adviser or have
any authority to supervise the investment or reinvestment of the
cash, securities or other property comprising the Series' assets
or to determine what securities or other property may be
purchased or sold by the Fund.
You will supply office facilities (which may be in your
own offices), data processing services, clerical, accounting and
bookkeeping services, internal auditing and legal services,
internal executive and administrative services, and stationery
and office supplies; prepare reports to each Series'
stockholders, tax returns, reports to and filings with the
Securities and Exchange Commission and state Blue Sky
authorities; calculate the net asset value of each Series'
shares; and generally assist in all aspects of the Fund's
operations.
You shall exercise your best judgment in rendering the
services to be provided to the Fund hereunder and the Fund agrees
as an inducement to your undertaking the same that neither you
nor the Sub-Administrator shall be liable hereunder for any error
of judgment or mistake of law or for any loss suffered by one or
more Series, provided that nothing herein shall be deemed to
protect or purport to protect you or the Sub-Administrator
against any liability to the Fund or a Series or to its security
holders to which you would otherwise be subject by reason of
willful misfeasance, bad faith or gross negligence in the
performance of your duties hereunder, or by reason of your
reckless disregard of your obligations and duties hereunder, or
to which the Sub-Administrator would otherwise be subject by
reason of willful misfeasance, bad faith or gross negligence in
the performance of its duties under the agreement by which you
engage it (the "Master Sub-Administration Agreement"), or by
reason of its reckless disregard of its obligations and duties
under such agreement.
In consideration of the services rendered pursuant to
this Agreement, the Fund will pay you on the first business day
of each month a fee at the rate set forth opposite each Series'
name on Schedule 1 hereto. Net asset value shall be computed on
such days and at such time or times as described in the Fund's
then-current Prospectus and Statement of Additional Information.
The fee for the period from the date of the commencement of the
public sale of a Series' shares to the end of the month during
which such sale shall have been commenced shall be pro-rated
according to the proportion which such period bears to the full
monthly period, and upon any termination of this Agreement before
the end of any month, the fee for such part of a month shall be
pro-rated according to the proportion which such period bears to
the full monthly period and shall be payable upon the date of
termination of this Agreement.
For the purpose of determining fees payable to you, the
value of each Series' net assets shall be computed in the manner
specified in the Fund's charter documents for the computation of
the value of each Series' net assets.
You will bear all expenses in connection with the
performance of your services under this Agreement and will pay
all fees of the Sub-Administrator in connection with its duties
in respect of the Series. All other expenses to be incurred in
the operation of the Fund will be borne by the Fund, except to
the extent specifically assumed by you. The expenses to be borne
by the Fund include, without limitation, the following:
organizational costs, taxes, interest, loan commitment fees,
interest and distributions paid on securities sold short,
brokerage fees and commissions, if any, fees of Board members,
Securities and Exchange Commission fees and state Blue Sky
qualification fees, advisory fees, charges of custodians,
transfer and dividend disbursing agents' fees, certain insurance
premiums, industry association fees, outside auditing and legal
expenses, costs of independent pricing services, costs of
maintaining the Series' existence, costs attributable to investor
services (including, without limitation, telephone and personnel
expenses), costs of preparing and printing prospectuses and
statements of additional information for regulatory purposes and
for distribution to existing stockholders, costs of stockholders'
reports and corporate meetings, and any extraordinary expenses.
The Fund understands that, from time to time hereafter,
you may act as administrator to one or more other investment
companies and fiduciary or other managed accounts, and the Fund
has no objection to your so acting. In addition, it is
understood that the persons employed by you to assist in the
performance of your duties hereunder will not devote their full
time to such service and nothing contained herein shall be deemed
to limit or restrict your right or the right of any of your
affiliates to engage in and devote time and attention to other
businesses or to render services of whatever kind or nature.
Neither you nor the Sub-Administrator shall be liable
for any error of judgment or mistake of law or for any loss
suffered by the Fund in connection with the matters to which this
Agreement or the Master Sub-Administration Agreement relates,
except, in the case of you, for a loss resulting from willful
misfeasance, bad faith or gross negligence on your part in the
performance of your duties or from reckless disregard by you of
your obligations and duties under this Agreement and, in the case
of the Sub-Administrator, for a loss resulting from willful
misfeasance, bad faith or gross negligence on its part in the
performance of its duties or from reckless disregard by it of its
obligations and duties under the Master Sub-Administration
Agreement. Any person, even though also your officer, Board
member, partner, employee or agent, who may be or become an
officer, Board member, partner, employee or agent of the Fund,
shall be deemed, when rendering services to the Fund or acting on
any business of the Fund, to be rendering such services to or
acting solely for the Fund and not as your officer, Board member,
partner, employee, or agent or one under your control or
direction even though paid by you.
As to each Series, this Agreement shall continue until
the date set forth opposite such Series' name on Schedule 1
hereto (the "Reapproved Date"), and thereafter shall continue
automatically for successive annual periods ending on the day of
each year set forth opposite the Series' name on Schedule 1
hereto (the "Reapproval Day"), provided such continuance is
specifically approved at least annually by (i) the Fund's Board
or (ii) vote of a majority (as defined in the Investment Company
Act of 1940, as amended) of such Series' outstanding voting
securities, provided that in either event its continuance also is
approved by a majority of the Fund's Board members who are not
"interested persons" (as defined in said Act) of any party to
this Agreement, by vote cast in person at a meeting called for
the purpose of voting on such approval. As to each Series, after
the Reapproval Date, this Agreement is terminable without
penalty, on 60 days' notice, by the Fund's Board or by vote of
holders of a majority of such Series' shares or, upon not less
than 90 days' notice, by you. This Agreement also will terminate
automatically, as to the relevant Series, in the event of its
assignment (as defined in said Act).
The Fund is agreeing to the provisions of this
Agreement that limit the Sub-Administrator's liability and other
provisions relating to the Sub-Administrator so as to induce the
Sub-Administrator to enter into the Master Sub-Administration
Agreement with you and to perform its obligations thereunder.
The Sub-Administrator is expressly made a third party beneficiary
of this Agreement with rights as respects the Fund to the same
extent as if it had been a party hereto.
The Fund recognizes that from time to time your
directors, officers and employees may serve as directors,
trustees, partners, officers and employees of other corporations,
business trusts, partnerships or other entities (including other
investment companies) and that such other entities may include
the name "Prairie" as part of their name, and that your
corporation or its affiliates may enter into administration or
other agreements with such other entities. If you cease to act
as the Fund's administrator, the Fund agrees that, at your
request, the Fund will take all necessary action to change the
name of the Fund to a name not including "Prairie" in any form or
combination of words.
This Agreement has been executed on behalf of the Fund
by the undersigned officer of the Fund in his capacity as an
officer of the Fund. The obligations of this Agreement shall
only be binding upon the assets and property of the Fund and
shall not be binding upon any Board member, officer or
shareholder of the Fund individually.
If the foregoing is in accordance with your understand-
ing, will you kindly so indicate by signing and returning to us
the enclosed copy hereof.
Very truly yours,
PRAIRIE FUNDS
By:
Accepted:
FIRST CHICAGO INVESTMENT
MANAGEMENT COMPANY
By:
<PAGE>
SCHEDULE 1
Annual Fee as
a Percentage
of Average
Daily Net Reapproval Reapproval
Name of Series Assets Date Day
Bond Fund .15%
Equity Income Fund .15%
Growth Fund .15%
Intermediate Municipal
Bond Fund .15%
International Bond Fund .15%
International Equity
Fund .15%
Managed Assets Fund .15%
Managed Assets Income
Fund .15%
Money Market Fund .15%
Municipal Money Market
Fund .15%
Special Opportunities
Fund .15%
<PAGE>
EXHIBIT 9(b)
MASTER SUB-ADMINISTRATION AGREEMENT
FIRST CHICAGO INVESTMENT MANAGEMENT COMPANY
Three First National Plaza
Chicago, Illinois 60670
November 18, 1994
Concord Holding Corporation
125 West 55th Street
11th Floor
New York, New York 10019
Dear Sirs:
First Chicago Investment Management Company (the
"Administrator"), in its capacity as the Administrator to Prairie
Funds, an open-end, management investment company (the "Fund"),
consisting of the series set forth on Exhibit A hereto, as such
Exhibit may be revised from time to time (each, a "Series"),
desires to employ you to perform administrative services in
respect of each Series and in that regard herewith confirms its
agreement with you as follows:
Subject to the Administrator's supervision and approval, you
will assist the Administrator by supervising all aspects of each
Series' operations, except that you shall not act and shall not
be required to act as an investment adviser or have any authority
to supervise the investment or reinvestment of the cash,
securities or other property comprising a Series' assets or to
determine what securities or other property may be purchased or
sold by any Series. In this connection it is understood that
from time to time you will employ or associate with yourself such
person or persons as you may believe to be particularly fitted to
assist you in the performance of this Agreement. Such person or
persons may be officers or employees who are employed by both you
and the Fund. The compensation of such person or persons shall
be paid by you and no obligation may be incurred on the Series'
behalf in any such respect.
You will supply office facilities (which may be in your own
offices), statistical and research data, data processing
services, clerical, accounting and bookkeeping services, internal
auditing and legal services, internal executive and administra-
tive services, and stationery and office supplies; prepare
reports to each Series' shareholders, tax returns, reports to and
filings with the Securities and Exchange Commission and state
Blue Sky authorities; and calculate the net asset value of each
Series' shares and dividends and capital gains distributions to
shareholders.
You shall exercise your best judgment in rendering the
services to be provided hereunder and the Administrator agrees as
an inducement to your undertaking the same that you shall not be
liable hereunder for any error of judgment or mistake of law or
for any loss suffered by any Series or the Administrator,
provided that nothing herein shall be deemed to protect or
purport to protect you against any liability to a Series or to
its security holders to which you otherwise would be subject by
reason of willful misfeasance, bad faith or gross negligence in
the performance of your duties hereunder, or by reason of your
reckless disregard of your obligations and duties hereunder.
In consideration of services rendered pursuant to this
Agreement, the Administrator agrees to pay you on the first
business day of each month the fee at the annual rate set forth
opposite each Series' name on Exhibit A hereto, based upon the
value of each Series' average daily net assets for the previous
month. Net asset value shall be computed on such days and at
such time or times as described in the Fund's then-current
Prospectus and Statement of Additional Information. The fee for
the period from the date of the commencement of the initial
public sale of each Series' shares to the end of the month during
which such sale shall have been commenced shall be pro-rated
according to the proportion which such period bears to the full
monthly period, and upon any termination of this Agreement before
the end of any month, the fee for such part of a month shall be
pro-rated according to the proportion which such period bears to
the full monthly period and shall be payable upon the date of
termination of this Agreement.
For the purpose of determining fees payable to you, the
value of each Series' net assets shall be computed in the manner
specified in the Fund's charter documents for the computation of
the value of its net assets.
You will bear all expenses in connection with the
performance of your services under this Agreement. The
Administrator hereby agrees that all other expenses to be
incurred in the operation of the Fund shall not be borne by you.
The Administrator and the Fund have agreed that such other
expenses will be borne by the Fund, except to the extent
specifically assumed by the Administrator. The expenses to be
borne by the Fund include, without limitation, the following, as
relevant: organizational costs, taxes, interest, loan commitment
fees, interest and distributions paid on securities sold short,
brokerage fees and commissions, if any, fees of Board members,
Securities and Exchange Commission fees and state Blue Sky
qualification fees, advisory fees, charges of custodians,
transfer and dividend disbursing agents' fees, certain insurance
premiums, industry association fees, outside auditing and legal
expenses, costs of independent pricing services, costs of
maintaining the Series' existence, costs attributable to investor
services (including, without limitation, telephone and personnel
expenses), costs of preparing and printing prospectuses and
statements of additional information for regulatory purposes and
for distribution to existing shareholders, costs of shareholders'
reports and meetings, and any extraordinary expenses.
The Administrator understands that you now act and will
continue to act as administrator or sub-administrator of, or in
other capacities with respect to, one or more other investment
companies and other managed accounts, and the Administrator has
no objection to your so acting. In addition, it is understood
that the persons employed by you to assist in the performance of
your duties hereunder will not devote their full time to such
services and nothing contained herein shall be deemed to limit or
restrict your right or the right of any of your affiliates to
engage in and devote time and attention to other businesses or to
render services of whatever kind or nature.
You shall not be liable for any error of judgment or mistake
of law or for any loss suffered by the Fund or the Administrator
in connection with the matters to which this Agreement relates,
except for a loss resulting from willful misfeasance, bad faith
or gross negligence on your part in the performance of your
duties or from reckless disregard by you of your obligations and
duties under this Agreement.
As to each Series, this Agreement shall continue until the
date set forth opposite such Series' name on Exhibit A hereto
(the "Continuation Date"), and thereafter shall continue
automatically for successive annual periods ending on the day of
each year set forth opposite such Series' name on Exhibit A
hereto (the "Continuation Day"); provided that, after the
Continuation Date, this Agreement is terminable without penalty,
on not more than 60 days' notice, by us, or upon 270 days'
notice, by you. In addition, notwithstanding anything herein to
the contrary, if the Administration Agreement terminates for any
reason, this Agreement shall terminate effective upon the date
the Administration Agreement terminates.
If the foregoing is in accordance with your understanding,
will you kindly so indicate by signing and returning to us the
enclosed copy hereof.
Very truly yours,
FIRST CHICAGO INVESTMENT
MANAGEMENT COMPANY
By:_______________________________
Accepted:
CONCORD HOLDING CORPORATION
By:_____________________
<PAGE>
EXHIBIT 9(c)
PRAIRIE FUNDS
SHAREHOLDER SERVICES PLAN
Introduction: It has been proposed that the
above-referenced investment company (the "Fund") adopt a
Shareholder Services Plan under which the Fund would pay the
Fund's distributor (the "Distributor") for providing services to
(a) shareholders of each series of the Fund or class of Fund
shares set forth on Exhibit A hereto, as such Exhibit may be
revised from time to time (each, a "Series"), or (b) if no series
or classes are set forth on such Exhibit, shareholders of the
Fund. The Distributor would be permitted to pay certain
financial institutions, securities dealers and other industry
professionals (collectively, "Service Agents") in respect of
these services. The Plan is not to be adopted pursuant to
Rule 12b-1 under the Investment Company Act of 1940, as amended
(the "Act"), and the fee under the Plan is intended to be a
"service fee" as defined in Article III, Section 26, of the NASD
Rules of Fair Practice.
The Fund's Board, in considering whether the Fund
should implement a written plan, has requested and evaluated such
information as it deemed necessary to an informed determination
as to whether a written plan should be implemented and has
considered such pertinent factors as it deemed necessary to form
the basis for a decision to use Series' assets for such purposes.
In voting to approve the implementation of such a
plan, the Board has concluded, in the exercise of its reasonable
business judgment and in light of applicable fiduciary duties,
that there is a reasonable likelihood that the plan set forth
below will benefit the Series and its shareholders.
The Plan: The material aspects of this Plan are
as follows:
13. As to each Series, the Fund shall pay to the
Distributor a fee at the annual rate set forth opposite each
Series' name on Exhibit A hereto of the value of the relevant
Series' average daily net assets in respect of the provision of
personal services to shareholders and/or the maintenance of
shareholder accounts. The Distributor shall determine the
amounts to be paid to Service Agents and the basis on which such
payments will be made. Payments to a Service Agent are subject
to compliance by the Service Agent with the terms of any related
Plan agreement between the Service Agent and the Distributor.
14. For the purpose of determining the fees
payable under this Plan, the value of the net assets of the Fund
or the net assets attributable to a Series (which term, as
provided in any Exhibit hereto, may relate to a class of shares)
shall be computed in the manner specified in the Fund's charter
documents for the computation of net asset value.
15. The Board shall be provided, at least
quarterly, with a written report of all amounts expended with
respect to the relevant class of each Series pursuant to this
Plan. The report shall state the purpose for which the amounts
were expended.
16. As to each Series, this Plan will become
effective immediately upon approval by a majority of the Board
members, including a majority of the Board members who are not
"interested persons" (as defined in the Act) of the Fund and have
no direct or indirect financial interest in the operation of this
Plan or in any agreements entered into in connection with this
Plan, pursuant to a vote cast in person at a meeting called for
the purpose of voting on the approval of this Plan.
17. As to each Series, this Plan shall continue
for a period of one year from its effective date, unless earlier
terminated in accordance with its terms, and thereafter shall
continue automatically for successive annual periods, provided
such continuance is approved at least annually in the manner
provided in paragraph 4 hereof.
18. As to each Series, this Plan may be amended
at any time by the Board, provided that any material amendments
of the terms of this Plan shall become effective only upon
approval as provided in paragraph 4 hereof.
19. As to each Series, this Plan is terminable
without penalty at any time by vote of a majority of the Board
members who are not "interested persons" (as defined in the Act)
of the Fund and have no direct or indirect financial interest in
the operation of this Plan or in any agreements entered into in
connection with this Plan.
20. The obligations hereunder and under any
related Plan agreement shall only be binding upon the assets and
property of the Fund or the affected series or class, as the case
may be, and shall not be binding upon any Board member, officer
or shareholder of the Fund individually.
Dated: November 18, 1994
<PAGE>
EXHIBIT A
Name of Series Fee
Bond Fund<F1> .25%
Equity Income Fund<F1> .25%
Growth Fund<F1> .25%
Intermediate Municipal
Bond Fund<F1> .25%
International Bond Fund<F1> .25%
International Equity Fund<F1> .25%
Managed Assets Fund<F1> .25%
Managed Assets Income Fund<F1>.25%
Money Market Fund<F1> .25%
Municipal Money Market
Fund<F2> .25%
Special Opportunities Fund<F1>.25%
__________________________
[FN] Class A shares and Class B shares only.
[FN] Class A shares only.
<PAGE>
EXHIBIT 15
PRAIRIE FUNDS
DISTRIBUTION PLAN
Introduction: It has been proposed that the
above-referenced investment company (the "Fund") adopt a
Distribution Plan (the "Plan"), in accordance with Rule 12b-1
promulgated under the Investment Company Act of 1940, as amended
(the "Act"), under which the Fund would pay the Fund's
distributor (the "Distributor") for advertising, marketing and
distributing shares of each series of the Fund or class of Fund
shares set forth on Exhibit A hereto, as such Exhibit may be
revised from time to time (each, a "Series"), or if no series or
classes are set forth on such Exhibit, shares of the Fund. The
Distributor would be permitted to pay third parties in respect of
these services. If the proposal is to be implemented, the Act
and Rule 12b-1 require that a written plan describing all
material aspects of the proposed financing be adopted by the
Fund.
The Fund's Board, in considering whether the Fund
should implement a written plan, has requested and evaluated such
information as it deemed necessary to an informed determination
as to whether a written plan should be implemented and has
considered such pertinent factors as it deemed necessary to form
the basis for a decision to use Series' assets for such purposes.
In voting to approve the implementation of such a
plan, the Board has concluded, in the exercise of its reasonable
business judgment and in light of applicable fiduciary duties,
that there is a reasonable likelihood that the plan set forth
below will benefit the Series and its shareholders.
The Plan: The material aspects of this Plan are
as follows:
21. (a) As to each Series, the Fund shall pay
to the Distributor a fee at the annual rate set forth opposite
each Series' name on Exhibit A hereto of the value of the
relevant Series' average daily net assets for advertising,
marketing and distributing such shares. The Distributor may pay
one or more financial institutions, securities dealers and other
industry professionals a fee in respect of these services. The
Distributor shall determine the amounts to be paid to third
parties and the basis on which such payments will be made.
Payments to financial institutions, securities dealers and other
industry professionals are subject to compliance by each such
party with the terms of any related Plan agreement between it and
the Distributor.
(b) The Fund shall pay all costs of
preparing and printing prospectuses and statements of additional
information for regulatory purposes and for distribution to
existing shareholders. As to each Series set forth on Exhibit B
hereto, the Fund also shall pay an amount of the costs and
expenses in connection with (a) preparing, printing and
distributing the Fund's prospectuses used for other purposes and
(b) implementing and operating this Plan, in each case not to
exceed in any fiscal year of the Fund the greater of $100,000 or
.005 of 1% of the average daily value of the net assets
attributable to the Series for such fiscal year.
22. For the purpose of determining the fees
payable under this Plan, the value of the net assets of a Series
(which term, as provided on any Exhibit hereto, may relate to a
class of shares) shall be computed in the manner specified in the
Fund's charter documents for the computation of net asset value.
23. The Board shall be provided, at least
quarterly, with a written report of all amounts expended with
respect to each Series pursuant to this Plan. The report shall
state the purpose for which the amounts were expended.
24. As to each Series, this Plan will become
effective immediately upon approval by (a) holders of a majority
of a Series' outstanding shares, and (b) a majority of the Board
members, including a majority of the Board members who are not
"interested persons" (as defined in the Act) of the Fund and have
no direct or indirect financial interest in the operation of this
Plan or in any agreements entered into in connection with this
Plan, pursuant to a vote cast in person at a meeting called for
the purpose of voting on the approval of this Plan.
25. As to each Series, this Plan shall continue
for a period of one year from its effective date, unless earlier
terminated in accordance with its terms, and thereafter shall
continue automatically for successive annual periods, provided
such continuance is approved at least annually in the manner
provided in paragraph 4(b) hereof.
26. As to each Series, this Plan may be amended
at any time by the Board, provided that (a) any amendment to
increase materially the costs which a Series may bear pursuant to
this Plan shall be effective only upon approval by a vote of
holders of a majority of the Series' outstanding shares, and
(b) any material amendments of the terms of this Plan shall
become effective only upon approval as provided in paragraph 4(b)
hereof.
27. As to each Series, this Plan is terminable
without penalty at any time by (a) vote of a majority of the
Board members who are not "interested persons" (as defined in the
Act) of the Fund and have no direct or indirect financial
interest in the operation of this Plan or in any agreements
entered into in connection with this Plan, or (b) vote of holders
of a majority of the Series' outstanding shares.
28. The obligations hereunder and under any
related Plan agreement shall only be binding upon the assets and
property of the Fund and shall not be binding upon any Board
member, officer or shareholder of the Fund individually.
Dated: November 18, 1994
<PAGE>
EXHIBIT A
Names of Series Fee
Bond Fund<F1> .75%
Equity Income Fund<F1> .75%
Growth Fund<F1> .75%
Intermediate Municipal Bond Fund<F1> .50%
International Bond Fund<F1> .75%
International Equity Fund<F1> .75%
Managed Assets Fund<F1> .75%
Managed Assets Income Fund<F1> .75%
Money Market Fund<F1> .75%
Special Opportunities Fund<F1> .75%
___________________
[FN] Class B shares only.
<PAGE>
EXHIBIT B
Names of Series
Intermediate Municipal Bond Fund<F1>
___________________
[FN] Class B shares only.
