KINETICS MUTUAL FUNDS, INC. AND KINETICS PORTFOLIOS TRUST ADDENDUM TO TRANSFER AGENT SERVICING AGREEMENT
KINETICS
MUTUAL FUNDS, INC.
AND
KINETICS
PORTFOLIOS
TRUST
ADDENDUM
TO TRANSFER AGENT SERVICING
AGREEMENT
THIS
ADDENDUM dated as of this 18th day of July, 2007 (“Addendum”) to the
Transfer Agent Servicing Agreement, dated as of January 1, 2002, as amended,
is
entered by and among KINETICS
MUTUAL FUNDS, INC., a Maryland corporation (the “Fund”), KINETICS PORTFOLIOS
TRUST, a
Delaware business trust (the “Portfolio”), and U.S. BANCORP FUND SERVICES,
LLC, a Wisconsin limited liability company (“USBFS”).
WHEREAS,
the parties have entered into a Transfer Agent Servicing Agreement dated as
of
January 1, 2002, as previously amended (the “Agreement”); and
WHEREAS,
the parties desire to modify the Agreement; and
WHEREAS,
Section 12 of the Agreement allows for its amendment by mutual written consent
of the parties;
NOW
THEREFORE, the parties agree to add and/or amend the following
provisions:
|
A.
|
A
new Section 15 shall be added to the Agreement to read as
follows:
|
|
15.
|
Additional
Services to be
Provided by USBFS
|
USBFS
shall provide the FAN Mail Services set forth in Exhibit D to this
Agreement in the form set forth below, subject to the terms and conditions
specified in Exhibit
D, as the same may be amended from time to time.
The
Fund
and the Portfolio hereby acknowledge that Exhibit D is an
integral part of this Agreement and, to the extent services included in Exhibit D are
selected by the Fund and the Portfolio, such services shall also be subject
to
the terms and conditions of the Agreement. The provisions of Exhibit D, shall
continue in effect for as long as the Agreement remains in effect, unless sooner
terminated pursuant to Section 12 hereof.
The
indemnity and defense provisions set forth in Section 6 of the
Agreement and in Exhibit D, if
applicable, shall indefinitely survive the termination and/or assignment of
the
Agreement.
1
Exhibit
D
to
the
Transfer
Agent Servicing Agreement
among Kinetics Mutual Funds, Inc., Kinetics Portfolios Trust and U.S. Bancorp
Fund Services, LLC
FAN
MAIL SERVICES
1. Certain
Definitions
Whenever
used in this Exhibit
D, the following words and phrases shall have the meanings set forth
below:
|
A.
|
“FAN
Mail®”
means the
system designed, developed and instituted by DST Systems, Inc. (“DST”)
known as “Financial Adviser Network MailTM”
or
“FAN
Mail,” which enables DST to make available data from DST’s TA2000® mutual
fund record-keeping systems and data provided to DST in the format
specified by DST from other mutual fund record-keeping systems or
record-keeping systems maintained by third parties for other Financial
Products through the Internet to authorized Users (as defined
below).
|
|
B.
|
“FAN
Mail
Services” means the services originally provided by DST using FAN
Mail, the Internet and other software equipment and systems provided
by
DST, telecommunications carriers, firewall providers and other third
parties, as described more fully in Section 3 of this Exhibit
D, to
which USBFS subscribes and is authorized to resell to its customers
pursuant to a separate agreement with
DST.
|
|
C.
|
“Financial
Products” means mutual funds, annuity, variable annuity or variable
universal life contracts or real estate investment trusts or limited
partnerships or other similar financial
products.
|
|
D.
|
“User(s)”
means
the persons to whom data is made available through FAN Mail Services,
including specified authorized agents of record owners of the Fund’s or
Portfolio’s shares, such as brokers, registered financial advisers,
financial planners and other financial intermediaries, and, when
requested
by the Fund or the Portfolio, the distributors of the Fund’s or the
Portfolio’s shares.
|
2. Services
Covered
USBFS
shall allow access to FAN Mail Services by authorized Users on behalf of the
Fund and the Portfolio in accordance with the terms of this Exhibit
D. By entering into the agreement with the Fund and the
Portfolio to provide services pursuant to this Exhibit D, USBFS
hereby consents to extraction of Files, as defined below, from TA2000 and
instructs DST to extract Files from TA2000 for authorized Users.
2
3.
Duties
and Responsibilities of
USBFS
USBFS
shall:
|
A.
|
Receive
data (“Files”) from DST’s TA2000 transfer agent record-keeping system and
address the Files to Users who have completed the enrollment process
for
FAN Mail Services required by DST and make the Files available to
such
Users. All Files will be made available only through the
Internet via a Hypertext Transfer Protocol Secure site (the “HTTPS
Server”). USBFS will provide to each User a user identification
(“User ID”) and a password (the “Password”) and shall permit access to the
Files on the HTTPS Server associated with a given User ID and Password
whenever the appropriate User ID and Password is received by the
HTTPS
Server. Each User is responsible for accessing the HTTPS Server
and retrieving such User’s Files. USBFS hereby reserves the
right to change the method of delivery for the FAN Mail Services
or to
develop an internal delivery
system.
|
|
B.
|
Make
available to Users the Files included in Appendix
1 to
this Exhibit
D. USBFS may from time to time and upon notice to the
Fund and the Portfolio add and/or delete Files from Appendix
1.
|
|
C.
|
Perform
the following administrative functions through DST necessary to establish
the link between the Files and the User’s HTTPS directory: maintain a data
base that contains the User’s name, address, electronic mailing address,
30 day history of Files made available (actual back-up of information
is
not maintained for the Fund and the Portfolio) and a list of Users
by
dealer/adviser number; provide billing to the Fund and the Portfolio;
provide daily reports to the Fund and the Portfolio; reasonably assist
the
Fund and the Portfolio and Users in establishing FAN Mail links;
monitor
transmissions and provide ongoing technical support for FAN Mail;
and
maintain a web site facilitating enrollment of new
Users.
|
|
D.
|
Ensure
that the HTTPS Server is accessible via the Internet. Through
DST, provide telephone support to the Fund or the Portfolio and Users
with
respect to the use of FAN Mail, use reasonable efforts to resolve
problems, and establish and maintain the HTTPS Server so it is available
for contact by financial planning software
vendors.
|
|
E.
|
If
additional FAN Mail Services become available during the term of
this
Agreement, USBFS shall offer the additional services to the Fund
and the
Portfolio. To the extent the Fund and the Portfolio elect to
receive any or all of such additional services, this Exhibit
D shall
be amended.
|
|
F.
|
Make
available, either directly or indirectly, all computers,
telecommunications equipment and other equipment and software reasonably
necessary to make FAN Mail Services available for use by the Fund
and the
Portfolio and its affiliated distributors, when
applicable.
|
3
4.
Duties and Responsibilities of the Fund and the Portfolio
The
Fund
and the Portfolio shall:
|
A.
|
Comply,
and instruct Users to comply, with all the User enrollment and
authorization procedures and FAN Mail Services security procedures
required by DST.
|
|
B.
|
Transmit
Files daily from the Fund’s and the Portfolio’s record-keeping systems
maintained by third parties to DST in formats specified from time
to time
by DST, if applicable.
|
|
C.
|
Obtain
and pay for connectivity to the HTTPS
Server.
|
|
D.
|
Have
the proper equipment and software to enable Users to access the HTTPS
Server and download the Files and obtain all related maintenance,
including support in the event of download
problems.
|
5.
System Maintenance
The
Fund
and the Portfolio understand that USBFS and DST will have to perform periodic
maintenance to the hardware and software used to provide FAN Mail Services,
which may cause temporary service interruptions. USBFS shall notify
the Fund and the Portfolio of all planned outages of its own hardware and
software and, to the extent possible, will perform any necessary maintenance
during non-business hours.
6.
Additional
Representation and
Warranty
The
parties hereby warrant that neither shall knowingly insert into any interface,
software, or program maintained or provided by a party to this Agreement, any
“back door,” “time bomb,” “Trojan Horse,” “worm,” “drop dead device,” “virus” or
other computer software code or routines or hardware components designed to
disable, damage or impair the operation of any system, program or operation
hereunder. For failure to comply with this warranty, the
non-complying party shall immediately replace all copies of the affected work
product, system or software. All costs incurred with replacement
including, but not limited to, cost of media, shipping, deliveries and
installation, shall be borne by such non-complying party.
7.
Proprietary Rights
|
A.
|
The
Fund and the Portfolio acknowledge and agree that by virtue of subscribing
to FAN Mail Services through USBFS, it shall not obtain any rights
in or
to any of the software, templates, screen and file formats, interface
protocols, formats and development tools and instructions, hardware,
processes, trade secrets, instruction manuals, enrollment authorization,
authentication and other business processes, proprietary information
or
distribution and communication networks used to provide FAN Mail
Services
owned by DST and licensed to USBFS. Any interfaces and software
provided to the Fund and the Portfolio in order to provide connectivity
to
FAN Mail through USBFS shall be used by the Fund and the Portfolio
and
Users only for the period during which this Exhibit
D is in
effect and only in accordance with the terms of this Exhibit
D, and
shall not be used by the Fund or the Portfolio to provide connectivity
to
or through any other system or person without USBFS’s prior written
approval. The Fund and the Portfolio shall not copy, decompile or
reverse engineer any software or programs provided to the Fund or
the
Portfolio hereunder. The Fund and the Portfolio also agree not
to take any action which would mask, delete or otherwise alter any
on-screen disclaimers and copyright, trademark and service xxxx
notifications, or any “point and click” features relating to User
acknowledgment and acceptance of such disclaimers and
notifications.
|
4
|
|
B.
|
The
FAN Mail Services site may contain certain intellectual property,
including, but not limited to, rights in copyrighted works, trademarks
and
trade dress that is the property of the Fund and the
Portfolio. The Fund and the Portfolio retain all rights in such
intellectual property that may reside on the FAN Mail Services site,
not
including any software and processes provided by USBFS. To the
extent the intellectual property of the Fund and the Portfolio is
cached
to expedite communication, the Fund and the Portfolio grant to USBFS
a
limited, non-exclusive, non-transferable license to such intellectual
property for a period of time no longer than that reasonably necessary
for
the communication. To the extent that the intellectual property
of the Fund and the Portfolio is duplicated within the FAN Mail Services
site to replicate the “look and feel,” “trade dress” or other aspect of
the appearance or functionality of the Fund’s web site(s), the Fund and
the Portfolio grant to USBFS a limited, non-exclusive, non-transferable
license to such intellectual property for the period during which
this
Exhibit
D
is in effect. This license is limited to the intellectual
property needed to replicate the appearance of the Fund’s web site(s) and
does not extend to any other intellectual property owned by the Fund
or
the Portfolio. The Fund and the Portfolio warrant that they
have sufficient right, title and interest in and to their web site(s)
and
their intellectual property to enter into these obligations, and
that to
their knowledge, the license hereby granted to USBFS does not and
will not
infringe on any U.S. patent, copyright or other proprietary right
of a
third party.
|
|
|
C.
|
Each
party agrees that the nonbreaching party would not have an adequate
remedy
at law in the event of the other party’s breach or threatened breach of
its obligations under this Section 7 of this Exhibit
D and
that the nonbreaching party would suffer irreparable injury and damage
as
a result of any such breach. Accordingly, in the event either
party breaches or threatens to breach the obligations set forth in
this
Section 7 of this Exhibit
D, in
addition to and not in lieu of any legal or other remedies a party
may
pursue hereunder or under applicable law, each party hereby consents
to
the granting of equitable relief (including the issuance of a temporary
restraining order, preliminary injunction or permanent injunction)
against
it by a court of competent jurisdiction, without the necessity of
proving
actual damages or posting any bond or other security therefor, prohibiting
any such breach or threatened breach. In any proceeding upon a
motion for such equitable relief, a party’s ability to answer in damages
shall not be interposed as a defense to the granting of such equitable
relief. The provisions of this Section 7 C. relating to
equitable relief shall survive termination of the provision of services
set forth in this Exhibit
D.
|
5
8.
Compensation
The
Fund
and the Portfolio shall compensate USBFS for providing FAN Mail Services to
the
Fund and the Portfolio, respectively, in accordance with the fee schedule set
forth in Appendix
1 to this Exhibit D (as
the
same may be amended in writing from time to time).
9.
Additional Indemnification; Limitation of Liability
|
A.
|
USBFS
CANNOT AND DOES NOT GUARANTEE AVAILABILITY OF THE FAN MAIL
SERVICES. Accordingly, USBFS’s sole liability to the Fund and
the Portfolio or any third party (including Users) for any claims,
notwithstanding the form of such claims (e.g., contract, negligence,
or
otherwise), arising out of the delay of or interruption in FAN Mail
Services to be provided by USBFS hereunder shall be to use its best
efforts to commence or resume FAN Mail Services as promptly as is
reasonably possible.
|
|
B.
|
USBFS
shall, at its sole cost and expense, defend, indemnify, and hold
harmless
the Fund and the Portfolio and their respective trustees, directors,
officers and employees from and against any and all claims, demands,
losses, expenses, damages or liabilities of any and every nature,
including reasonable attorneys’ fees, arising out of or relating to (a)
any infringement, or claim of infringement, of any United States
patent,
trademark, copyright, trade secret, or other proprietary rights based
on
the use or potential use of FAN Mail Services and (b) the provision
of the
Fund Files (as defined below) or Confidential Information (as defined
below) to a person other than a person to whom such information may
be
properly disclosed hereunder.
|
|
C.
|
If
an injunction is issued against the Fund, the Portfolio and/or User
with
respect to: use of FAN Mail Services by reason of infringement of
a
patent, copyright, trademark, or other proprietary rights of a third
party, USBFS shall, at its own option and expense, either (i) procure
for
the Fund and the Portfolio and Users the right to continue to use
FAN Mail
Services on substantially the same terms and conditions as specified
hereunder, or (ii) after notification to the Fund or the Portfolio,
replace or modify FAN Mail Services so that they become non-infringing,
provided that, in the Fund’s and the Portfolio’s judgment, such
replacement or modification does not materially and adversely affect
the
performance of FAN Mail Services or significantly lessen their utility
to
the Fund, the Portfolio and/or Users. If in the Fund’s or
Portfolio’s judgment, such replacement or modification does materially
adversely affect the performance of FAN Mail Services or significantly
lessen their utility to the Fund, the Portfolio and/or Users, the
Fund or
the Portfolio may terminate all rights and responsibilities under
this
Exhibit
D
immediately on written notice to
USBFS.
|
6
|
D.
|
Because
the ability of USBFS to deliver FAN Mail Services is dependent upon
the
Internet and equipment, software, systems, data and services provided
by
various telecommunications carriers, equipment manufacturers, firewall
providers and encryption system developers and other vendors and
third
parties, including DST, USBFS shall not be liable for delays or failures
to perform its obligations hereunder to the extent such delays or
failures
are attributable to circumstances beyond its reasonable control which
interfere with the delivery of FAN Mail Services by means of the
Internet
or any of the equipment, software and services which support the
Internet
provided by such third parties. USBFS shall also not be liable
for the actions or omissions of any third party wrongdoers (i.e.,
hackers
not employed by USBFS or its affiliates) or of any third parties
involved
with FAN Mail Services as long as USBFS and its agents comply with
the
data security policy described in Section 10 A. of this Exhibit
D. This Exhibit D may be terminated by any party upon the
breach of the other party of any material term of this Exhibit D
if such
breach is not cured within 15 days of notice of such breach to the
breaching party.
|
|
E.
|
The
Fund, the Portfolio and Users are responsible for verifying the accuracy
and receipt of all data or information made available via FAN Mail
Services. The Fund and the Portfolio are responsible for
advising Users of their responsibilities to promptly notify the USBFS
of
any errors or inaccuracies relating to data or other information
made
available via FAN Mail Services with respect to the Fund’s
shareholders.
|
|
F.
|
USBFS
shall not be responsible for the accuracy of input material from
Users and
the Fund’s or the Portfolio’s record-keeping systems maintained by third
parties nor the resultant output derived from inaccurate
input. The accuracy of input and output shall be judged as
received at USBFS’s data center as determined by the records maintained by
USBFS.
|
10.
File Security and Retention; Confidentiality
|
A.
|
USBFS
and its agents will provide reasonable security provisions to ensure
that
unauthorized third parties do not have access to the Fund’s or the
Portfolio’s data bases, files, and other information provided by the Fund
or the Portfolio to USBFS for use with FAN Mail Services, the Files
included in Appendix
1 to
this Exhibit
D or the names of Users (collectively, “Fund
Files”). USBFS’s security provisions with respect to FAN Mail
Services and the Fund Files will be no less protected than USBFS’s
security provisions with respect to its own proprietary
information. USBFS agrees that any and all Fund Files
maintained by USBFS hereunder shall be available for inspection by
the
Fund’s, the Portfolio’s or User’s regulatory authorities during regular
business hours, upon reasonable prior written notice to USBFS, and
will be
maintained and retained in accordance with applicable requirements
of the
Investment Company Act of 1940, as amended. In addition, USBFS
will not use, or permit the use of, names of Users for the purpose
of
soliciting any business, product, or service
whatsoever.
|
7
|
B.
|
USBFS
shall treat as confidential and not disclose or otherwise make available
any of the Fund’s or the Portfolio’s lists, information, trade secrets,
processes, proprietary data, information or documentation (collectively,
the “Confidential Information”), in any form, to any person other than
agents, employees or consultants of USBFS. USBFS will instruct
its agents, employees and consultants who have access to the Confidential
Information to keep such information confidential by using the same
care
and discretion that USBFS uses with respect to its own confidential
property and trade secrets. Upon termination of the rights and
responsibilities described in this Exhibit
D for
any reason and upon the Fund’s or the Portfolio’s request, USBFS shall
return to the Fund or the Portfolio, or destroy and certify that
it has
destroyed, any and all copies of the Confidential Information which
are in
its possession.
|
|
C.
|
Notwithstanding
the above, USBFS will not have an obligation of confidentiality under
this
Section with regard to information that (1) was known to it prior
to
disclosure hereunder, (2) is or becomes publicly available other
than as a
result of a breach hereof, (3) is disclosed to it by a third party
not
subject to a duty of confidentiality, or (4) is required to be disclosed
under law or by order of court or governmental
agency.
|
11.
Warranties
EXCEPT
AS
OTHERWISE EXPRESSLY PROVIDED IN THIS EXHIBIT, FAN MAIL SERVICES AND ALL
EQUIPMENT, SOFTWARE AND SYSTEMS DESCRIBED IN THIS EXHIBIT ARE PROVIDED
“AS IS” ON AN “AS AVAILABLE” BASIS, AND USBFS HEREBY SPECIFICALLY DISCLAIMS
ANY AND ALL REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED, REGARDING FAN
MAIL SERVICES PROVIDED HEREUNDER, INCLUDING ANY IMPLIED WARRANTY OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE AND IMPLIED WARRANTIES
ARISING FROM COURSE OF DEALING OR COURSE OF PERFORMANCE.
12.
Termination
of FAN
Mail
Except
as
otherwise specifically noted in this Exhibit D, FAN Mail
may be terminated by either party upon giving 90 days prior written notice
to
the other party. FAN Mail will not be interrupted during the 90 day
period and USBFS will cooperate in the reasonable transfer of duties to another
provider.
8
13.
Duties in the Event of Termination
In
the
event of termination of the services provided pursuant to this Exhibit D, (i) the
Fund, the Portfolio and Users will immediately end their access to FAN Mail
Services and (ii) the Fund and the Portfolio will return all codes, system
access mechanisms, programs, manuals, confidential or proprietary information
or
and other written information provided by USBFS in connection with the services
provided hereunder, and shall destroy or erase all such information on any
diskettes or other storage medium.
9
Appendix
1
to
Exhibit
D
to
the
Files
and FAN Mail Fee
Schedule
I.
Files
The
following Files shall be provided to Users as required by Exhibit
D:
Account
Position File
Direct
Financial Activity
File
Account
Master Position
File
New
Account Activity
File
Non-Financial
Activity
File
Distribution
Activity File
Daily
Price File
USBFS
agrees to allow access to Fan
Mail by XX Xxxxxxx only and thereafter on a case by case basis, as determined
and conveyed to USBFS by the Funds.
II. Fees
– FAN Mail
|
TRANSFER
AGENT &
SHAREHOLDER SERVICES
SUPPLEMENTAL
SERVICES -
E-COMMERCE SERVICES
FEE
SCHEDULE at July,
2007
|
|
FAN
MAIL– Financial planner mailbox provides transaction,
account and price information to financial planners and small
broker/dealers for import into a variety of financial planning software
packages.
· Base
Fee Per Management Company – file generation and delivery - $______ per
year
· Per
Record Charge
· Rep/Branch/ID
- $_____
· Dealer
- $_____
· Price
Files - $_____ or $_____/user/month, whichever is less
|
10
Except
to
the extent supplemented hereby, the Agreement shall remain in full force and
effect.
IN
WITNESS WHEREOF, the parties hereto have caused this Addendum to be executed
by
a duly authorized officer on one or more counterparts as of the date and year
first written above.
KINETICS
MUTUAL FUNDS,
INC. U.S
BANCORP FUND SERVICES, LLC
By:
/s/ Xxxxx X.
Xxxxx
By: /s/ Xxxxxxx
X.
XxXxx
Name:
Xxxxx X.
Xxxxx
Name: Xxxxxxx
X.
XxXxx
Title:_______________________________ Title:
Senior Vice
President
KINETICS
PORTFOLIOS
TRUST
By:
/s/ Xxxxxx
Xxxxxxxx
Name:
Xxxxxx
Xxxxxxxx
Title:
Treasurer
11
