exv10w30



 








Exhibit 10.30









INSTITUTIONAL CUSTODY SERVICES AGREEMENT



THIS
AGREEMENT, effective July 25, 2006, is entered into by and between
Allied Capital (“Client”) and Manufacturers and Traders Trust Company (“Custodian” or “M&T Bank”), to establish a custody
service account or accounts (the “Account”) for Client. Client and Custodian have agreed to the following:





	1.	 	MEANING OF SOME WORDS
	 
	 	 	“Assets” means all cash, securities and other property deposited with Custodian or collected or
received by Custodian for the Account. “Client” refers to the entity identified above and its
legal successors and assigns, and to the undersigned in his or her capacity as an authorized
representative acting on behalf of such entity. “Investment Manager” means any investment
manager(s) appointed by Client to direct the investment of the Assets. “Proper Instructions”
means either (a) a writing signed or initialed by Client or by Client’s authorized
representative or, (b) a copy of a confirmation from a broker, (c) notice of an affirmed
confirmation given electronically via The Depository Trust Company (“DTC”) institutional
delivery system, or (d) instructions given orally or electronically by any individual Custodian
reasonably believes to be Client, Client’s authorized representative, or an Investment Manager.
	 
	2.	 	RESPONSIBILITY
	 
	 	 	Custodian will act as agent for Client and will hold and physically segregate the Assets for the
Account of the Client. Custodian will collect all income and other payments with respect to the
Assets and pay such amounts as instructed in Schedule I, Client Information and Instructions,
attached hereto and made a part hereof. Custodian will not be responsible for the investment of
the Assets or for providing investment advice.
	 
	 	 	Except as provided in this Section 2, Custodian will settle any transaction for the Account only
after receiving Proper Instructions. Notwithstanding the foregoing, Custodian is authorized to
sell fractional shares and deposit the proceeds in the Account. Custodian may exchange any
Assets in temporary form for property in final form unless Custodian receives Proper
Instructions to the contrary. When securities become due or are called for redemption,
Custodian will turn them in for proper payment. Custodian will notify Client or, if an
Investment Manager has been appointed, the Investment Manager of any optional call for or right
of redemption, offer of exchange, right of subscription, reorganization or other optional
proceeding (“Corporate Action”) affecting any security in the Account as soon as reasonably
practicable after such information is published by The Wall Street Journal, DTC, or XCITEK.
Custodian will take such action with respect to such Corporate Action as Custodian is directed
by Proper Instruction unless (a) the Corporate Action is a stock split or optional capital gain
distribution, in which case Custodian will take the distribution in kind and credit the
principal of the Account, or (b) the Corporate Action relates to stockholder rights or capital
distributions with respect to securities in the Account, in which case Custodian will take such
action as instructed in Schedule I. When adequate financial information is not available in any
of the foregoing publications, Custodian will not be required to notify Client or the Investment
Manager of any Corporate Action affecting any security in the Account and Custodian’s
responsibility will be limited to the safekeeping of the Assets.
	 
	 	 	Custodian shall have no power or authority to assign, hypothecate, pledge or otherwise dispose
of any securities and investments except pursuant to the directive of Client and only for the
Account of Client.
	 
	 	 	All oral instructions will be confirmed in writing by Client, Client’s authorized
representative, or an Investment Manager by the close of business on the same day that such oral
instructions are given to Custodian. Client agrees that the fact that Custodian does not
receive written confirmation of an oral instruction or that Custodian receives a contrary
written instruction shall in no way affect the validity or enforceability of transactions
authorized by such oral instructions and already effected by Custodian prior to receipt of
contrary written instructions.
	 
	 	 	The Assets may include shares of mutual funds. Client understands that Custodian makes
available one or more money market mutual funds for use as investment vehicles for cash balances
and will invest the Account’s cash balances in such of those funds as Client designates in
writing. Client understands that Custodian and its affiliates may provide investment
management, shareholder, administrative or other services for mutual funds held in the Account
(including mutual funds used as investment vehicles for cash balances) and receive compensation
for such services from those funds in addition to the compensation Custodian receives under
Section 5 of this Agreement.
	 
	 	 	If so directed by Proper Instructions, Custodian shall invest all or part of the Assets in certificates of deposit or other





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	 	 	deposit accounts of M&T Bank, and Custodian is hereby authorized to debit such accounts for
amounts which may become due under this Agreement.
	 
	3.	 	OWNERSHIP OF PROPERTY
	 
	 	 	Custodian may execute and deliver on Client’s behalf all necessary documents required by any law
inserting Client’s name as beneficial owner. Client represents and warrants that Client has
full power and authority to enter into this Agreement and to exercise control over the Assets.
	 
	4.	 	STATEMENTS
	 
	 	 	Custodian will send Client at the address shown in Custodian’s records for Client periodic
statements listing all Assets and showing all cash receipts and disbursements for the Account.
These statements will present current market prices obtained by Custodian from one or more third
party pricing services selected by Custodian in the usual course of its business. When adequate
pricing for any security or securities is not readily available to Custodian from any of such
third party pricing service providers, Custodian will not be required to provide current market
prices for those securities. Custodian will not be liable for any loss, whether direct or
indirect, including consequential damages, which may occur from any inaccuracies in market
pricing information. Unless Client indicates otherwise on Schedule I, Client agrees that such
statements are in lieu of any further notification that Custodian would otherwise be required to
give Client under Regulation H of the Board of Governors of the Federal Reserve System. Under
Regulation H, Client would be entitled to notification from Custodian, at no additional cost,
concerning each purchase and sale for the Account at or before the completion of the
transaction, or if a broker is used, within one business day after receipt of the broker’s
confirmation.
	 
	 	 	Custodian shall provide Client, at such times as Client may reasonably require, with reports by
independent public accountants on the accounting system, internal accounting control and
procedures for safeguarding securities, including securities deposited and/or maintained in a
securities depository, relating to the service provided by Custodian under this Agreement; such
reports shall be of sufficient scope and in sufficient detail, as may reasonably be requested by
Client to provide reasonable assurance that any material inadequacies would be disclosed by such
examination, and, if there are no such inadequacies, the reports shall so state.
	 
	 	 	Custodian shall create and maintain all records relating to its activities and obligations under
this Agreement in such manner as will meet the obligations of Client under the 1940 Act, with
particular attention to Section 31 and the applicable rules thereunder. All such records shall
be the property of Client and shall at all times during the regular business hours of Custodian
be open for inspection by duly authorized officers, employees or agents of Client and employees
or agents of the Securities and Exchange Commission. Custodian shall, at Client’s request,
supply Client with a tabulation of securities owned by Client and held by Custodian and shall,
when requested to do so by Client and for such compensation as shall be agreed upon between
Client and Custodian, include certificate numbers in such tabulations.
	 
	5.	 	COMPENSATION AND REIMBURSEMENT
	 
	 	 	Custodian’s compensation will be according to Custodian’s published fee schedule in effect from
time to time, and will be paid periodically. The current schedule is attached to this
Agreement. If the fee schedule changes, Custodian will provide Client the new schedule and the
new schedule will apply to this Agreement on the later of the date specified on the new schedule
or 30 days after Custodian mails or otherwise delivers the new schedule to Client. Client will
pay Custodian for all expenses including taxes, liability, loans, overdrafts or other charges
incurred by Custodian in connection with the Account. Custodian is authorized to charge all of
its fees and expenses against the Account. Custodian will be reimbursed for all reasonable
expenses of re-registration and delivery of securities on termination. If Custodian agrees to
invoice Client separately for Custodian’s fees and expenses, Custodian may nevertheless deduct
such fees and expenses from the Account if (a) Client does not pay any such invoice within 45
days of the date Custodian sends it to Client, or (b) the account against which payment is to be
charged does not have sufficient funds.
	 
	6.	 	FUNDS TRANSFERS
	 
	 	 	If Client wishes to transfer funds from the Account via wire, automated clearing house (“ACH”),
or similar transfer, Client agrees to complete M&T Bank’s standard documentation with respect to
such transfers and that documentation will govern any such transfer. Custodian will notify
Client of the receipt of incoming fund transfers (including wire transfers) and ACH transactions
involving the Account in the periodic statements that Custodian provides Client. Custodian is
not required to give Client a separate notice of each transaction.
	 
	 	 	Client understands that, when Custodian gives Client credit with respect to an ACH credit entry,
that credit is provisional until Custodian receives final settlement for the entry through a
Federal Reserve Bank or otherwise as provided by Uniform Commercial Code Article 4A. If
Custodian does not receive final settlement, Client understands that Custodian is entitled to a
refund of the amount credited to Client in connection with such entry, and that the party making
payment to Client via





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	 	 	such entry shall not be deemed to have paid Client and will still owe Client that amount.
	 
	7.	 	CUSTODY AND REGISTRATION
	 
	 	 	Custodian will be as careful in the safekeeping of the Assets as it would be with its own
property. All Assets which are required to be registered shall be registered in Custodian’s
name or the name of Custodian’s nominee or nominees and Custodian is authorized to execute in
any name such documents as may be required to effect such registration. Custodian may deposit
any securities of the United States with a Federal Reserve Bank and may deposit any eligible
securities with the DTC to be registered in the name of its nominee, in compliance with the
conditions of Rule 17f-4 under the Investment Company Act of 1940, as amended (the “1940 Act”).
Custodian is obligated to exercise due care in accordance with reasonable commercial standards
in discharging its duties as a securities intermediary to obtain and thereafter maintain
Client’s assets. Custodian may make other safekeeping arrangements as are from time to time
allowed by law. Custodian may use the services of correspondent banks for holding or
transferring securities.
	 
	8.	 	LIABILITY
	 
	 	 	Except for bad faith, Custodian will not be responsible for any loss or damage to the Account.
Custodian will be under no duty to take any action except as Custodian and Client agree in
writing. Custodian is also under no duty to become involved in any legal proceeding unless
Custodian is indemnified to its satisfaction.
	 
	9.	 	DUE AUTHORIZATION
	 
	 	 	Client warrants and represents to Custodian that: (i) it is duly organized and existing and in
good standing in the state in which it is organized; (ii) all action has been taken by or on
behalf of Client to authorize it to enter into this Agreement and invest its assets as
contemplated by this Agreement, with the elections that the undersigned has made and the
directions he or she has given; (iii) all information provided in this Agreement and in Schedule
I is true, complete and not misleading and accurately reflects Client’s instructions to
Custodian and (iv) this Agreement and the investments authorized by it do not and will not
violate any provision of any governing instrument or document, or any law, regulation, or
judicial order, or any agreement applicable to or binding on Client or its Assets.
	 
	10.	 	GENERAL PROVISIONS






	 	A.	 	Client will certify to Custodian the names of any persons authorized to act for Client
(“authorized representatives”). Custodian may continue to rely (and will be fully protected
in relying) on the authority of such authorized representatives until it is advised in
writing by Client to the contrary and Custodian has had a reasonable time to act.
Custodian may rely (and will be fully protected in relying) on any certificate, notice or
direction which Custodian believes to have been signed by an authorized representative.
	 
	 	B.	 	Custodian shall take all reasonable action, as Client may from time-to-time request, to
obtain from year-to-year favorable opinions from Client’s independent accountants with respect
to Custodian’s activities hereunder.
	 
	 	C.	 	Custodian will be notified immediately in writing by Client or Client’s authorized
representative if (a) an Investment Manager is appointed, or (b) an Investment Manager
resigns or an investment management relationship is otherwise terminated. Any such
Investment Manager will supply Custodian in writing with the names and specimen signatures
of any individuals authorized to act on its behalf. Custodian will be fully protected in
(i) relying on any Proper Instruction purportedly given by such individual on behalf of the
Investment Manager, (ii) assuming, until advised in writing by the Investment Manager to
the contrary that any designation of individuals to give instructions on behalf of the
Investment Manager remains in effect, and (iii) assuming, until advised in writing by
Client or Client’s authorized representative to the contrary, that an appointment of an
Investment Manager remains in effect.
	 
	 	D.	 	Custodian also may raise cash to pay for Client’s purchases by redeeming shares in any
one or more of the money market funds in the Account. However, Custodian does not have to
pay for or settle any purchase transaction unless adequate cash is already in the Account.
If Custodian grants provisional credit to the Account on a contractual settlement basis and
determines that the item associated with the credit will not be received in due course,
Custodian reserves the right to reverse the credit and charge the Account for the amount of
the credit at any time before actual receipt of the item. All credits are made subject to
actual collection. Custodian shall not be liable to Client or any other person for any
amount that is not actually collected in accordance with the terms of this Agreement.
Client understands that contractual settlement may result in overdrafts and that Custodian
discourages overdrafts. Custodian reserves the right to charge the Account for the amount
earned with respect to an overdraft or Custodian’s cost and expense in connection with an
overdraft. Custodian may terminate or suspend any part of the provision of contractual
settlement hereunder for any reason immediately upon notice to Client, including if
overdrafts occur repeatedly, in the event of force majeure affecting settlement, disorder
in markets, or with respect to particular investments or other





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	 	 	 	changed external business circumstances.
	 
	 	E.	 	This Agreement may not be amended except by the express written agreement of both
parties. Either Custodian or Client can terminate the Agreement by 60 days’ prior written
notice to the other. Custodian will have no further responsibility for the Account once
Custodian delivers the Assets to Client or to a third party pursuant to Client’s
instructions. If Client gives Custodian no delivery instructions, Custodian may deliver
any of the Assets to any authorized representative of Client by registered mail insured to
the then current mailing address for Client as shown in Custodian’s records.
	 
	 	F.	 	Any questions or disputes concerning this Agreement will be decided according to New
York law unless federal law provides otherwise, and any ambiguity shall at all times be
interpreted consistently with the 1940 Act pursuant to Section 17f and rules promulgated
thereunder.
	 
	 	G.	 	Any notice Custodian sends concerning the Agreement or the Account will be sent to the
then current mailing address as shown in Custodian’s records for Client and shall be deemed
given when sent. If such mailing address changes, Client or Client’s authorized
representative will promptly notify Custodian in writing of the new mailing address. Any
notice to Custodian shall be sent to: Custody Department, Institutional Custody Services,
Manufacturers and Traders Trust Company, at such address as is provided to Client by
Custodian for that purpose and shall be deemed given when received.
	 
	 	H.	 	If any provision of this Agreement shall be held to be invalid or unenforceable, such
invalidity or unenforceability shall attach only to such provision, and the validity of the
remaining provisions shall not be affected thereby.





	 	 	 	 	 	 	 	 	 	 	 
	Agreement accepted by Client:	 	Agreement accepted by

Manufacturers and Traders Trust Company:
	 
	 	 	 	 	 	 	 	 	 	 
	Allied Capital Corporation
	 	By:	 	/s/ Lyn Somerville
	 	 	 	 	 
	Client Name	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ Kelly A. Anderson	 	Date
	 	7/25/06	 	Name:	 	Lyn M. Somerville
	 

	 	 
	 	 	 	 
	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Kelly A. Anderson
	 	Title:	 	Vice President
	 	 	 	 	 
	Name	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	EVP — Treasurer
	 	Date:	 	8/1/06
	 	 	 	 	 
	Title	 	 	 	 







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