1
CUSTODIAL SERVICES AGREEMENT
This CUSTODIAL SERVICES AGREEMENT ("Agreement") is entered into as of this
day of , by and
between
("Depositor"), with its principal office at
,and ("Institution"), with its principal
office at
, and ("Custodian"), with its
principal office at
.
W I T N E S S E T H
WHEREAS, the Depositor has agreed to deposit funds with the Institution pursuant to the terms and provisions of that
certain Security Agreement for Funds Held in Deposit ("Security Agreement") by and between the Depositor and the Institution
dated as of
; and
WHEREAS, pursuant to the terms and provisions of the Security Agreement, the Institution has agreed to assign,
transfer, pledge and convey to the Depositor a perfected security interest in certain eligible securities owned by the Institution (the
"Collateral"); and
WHEREAS, in order to perfect the Depositor's security interest in the Collateral, the Custodian, as agent for the
Depositor, will accept from the Institution, take possession of and hold such Collateral solely for the benefit of the Depositor.
NOW, THEREFORE, in consideration of the mutual covenants and premises herein contained, the parties do hereby
agree as follows:
1. The Custodian hereby accepts employment as the Depositor's custodian and depositary pursuant to the terms of this
Agreement.
2. The Custodian shall accept and retain as Custodian solely for the benefit of the Depositor all securities tendered by
the Institution as Collateral for its obligations under the Security Agreement. For the purposes of this Agreement, the term
"securities" shall have the same meaning as set forth in the Security Agreement. Upon receipt of Collateral from the Institution
for the benefit of the Depositor, the Custodian shall (i) immediately notify the Depositor, by telephone or otherwise, of the
Collateral pledged, (ii) issue a written receipt to the Institution evidencing Custodian's receipt of the Collateral, and (iii) within
three business days issue and provide delivery to Depositor written confirmation evidencing Institution has pledged and
Custodian has received Collateral.
3. The Custodian shall identify on its books and records as being pledged to the Depositor specific securities or a
quantity of specific securities received by it for, or for the account of, the Depositor
. The Custodian shall have no power or
authority to transfer, assign, hypothecate, pledge or otherwise dispose of any such securities, except pursuant to instructions from
the Depositor and pursuant to the terms of this Agreement.
4. If at any time the ratio of the market value of the Collateral to the amount of funds on deposit is less than the
Maintenance Percentage, then the Institution shall assign, pledge and convey a security interest and transfer to the Depositor
securities of the type eligible to be pledged pursuant to Arkansas Code Annotated §23-47-203, as amended, and in such amount
so that the ratio of the market value of such pledged securities to the amount of funds on deposit shall be at least equal to the
Maintenance Percentage. Failure by Institution to provide securities of the type eligible to be pledged pursuant to Arkansas
Code Annotated §23-47-203, as amended, in such amount so that the ratio of the market value of such pledged securities to the
amount of funds on deposit is at least equal to the Maintenance Percentage, shall at the discretion of the Treasurer of State
make all funds of the Depositor held by the Institution subject to immediate withdrawal without penalty and with interest
being due and payable to the date of withdrawal.
5. The Custodian shall, on the first business day following receipt by the Custodian of prior written notice, allow the
Institution to withdraw any of the securities constituting the Collateral, if the Institution shall simultaneously deliver to the
Custodian as additional Collateral securities of the same type and having at least the same market value as the securities
withdrawn.
