Exhibit h
TRANSFER AGENCY AND SERVICE AGREEMENT
BETWEEN
CGM CAPITAL DEVELOPMENT FUND
AND
STATE STREET BANK AND TRUST COMPANY
TABLE OF CONTENTS
Page
1. Terms of Appointment and Duties......................................1
2. All Non-Same Day (TD+1) Processing/Settlement Environments ..........6
3. Fees and Expenses....................................................7
4. Representations and Warranties of the Transfer Agent.................8
5. Representations and Warranties of the Fund...........................9
6. Wire Transfer Operating Guidelines...................................9
7. Data Access and Proprietary Information.............................11
8. Indemnification.....................................................13
9. Standard of Care....................................................14
10. Year 2000...........................................................14
11. Confidentiality ....................................................14
12. Covenants of the Fund and the Transfer Agent........................15
13. Termination of Agreement............................................16
14. Assignment and Third Party Beneficiaries............................17
15. Subcontractors......................................................17
16. Miscellaneous.......................................................18
17. Additional Funds....................................................20
18. Limitations of Liability of the Trustees and Shareholders...........20
TRANSFER AGENCY AND SERVICE AGREEMENT
AGREEMENT made as of the 1ST day of January, 2000, by and between CGM CAPITAL
DEVELOPMENT FUND, a Massachusetts business trust, having its principal office
and place of business at Xxx Xxxxxxxxxxxxx Xxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000
(the "Fund"), and STATE STREET BANK AND TRUST COMPANY, a Massachusetts trust
company having its principal office and place of business at 000 Xxxxxxxx
Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000 (the "Transfer Agent").
WHEREAS, the Fund is authorized to issue shares in separate series, with each
such series representing interests in a separate portfolio of securities and
other assets;
WHEREAS, the Fund intends to initially offer shares in one (1) series, such
series shall be named in the attached Schedule A which may be amended by the
parties from time to time (each such series, together with all other series
subsequently established by the Fund and made subject to this Agreement in
accordance with Section 17, being herein referred to as a "Portfolio", and
collectively as the "Portfolios"); and
WHEREAS, the Fund on behalf of the Portfolios desires to appoint the Transfer
Agent as its transfer agent, dividend disbursing agent, custodian of certain
retirement plans and agent in connection with certain other activities, and the
Transfer Agent desires to accept such appointment.
NOW, THEREFORE, in consideration of the mutual covenants herein contained, the
parties hereto agree as follows:
1. Terms of Appointment and Duties
1.1 Transfer Agency Services. Subject to the terms and conditions set forth
in this Agreement, the Fund, on behalf of the Portfolios, hereby
employs and appoints the Transfer Agent to act as, and the Transfer
Agent agrees to act as its transfer agent for the Fund's authorized and
issued shares of its beneficial interest ("Shares"), dividend
disbursing agent, custodian of certain retirement plans and agent in
connection with any accumulation, open-account or similar plan provided
to the shareholders of each of the respective Portfolios of the Fund
("Shareholders") and set out in the currently effective prospectus and
statement of additional information ("prospectus") of the Fund on
behalf of the applicable Portfolio, including without limitation any
periodic investment plan or periodic withdrawal program. In accordance
with procedures established from time to time by agreement between the
Fund on behalf of each of the Portfolios, as applicable and the
Transfer Agent, the Transfer Agent agrees that it will perform the
following services:
(a) Receive for acceptance, orders for the purchase of Shares, and
promptly deliver payment and appropriate documentation thereof to the
Custodian of the Fund authorized pursuant to the Declaration of Trust
of the Fund (the "Custodian");
(b) Pursuant to purchase orders, issue the appropriate number of Shares
and hold such Shares in the appropriate Shareholder account;
(c) Receive for acceptance redemption requests and redemption
directions and deliver the appropriate documentation thereof to the
Custodian;
(d) In respect to the transactions in items (a), (b) and (c) above, the
Transfer Agent shall execute transactions directly with broker-dealers
authorized by the Fund and Shareholders;
(e) At the appropriate time as and when it receives monies paid to it
by the Custodian with respect to any redemption, pay over or cause to
be paid over in the appropriate manner such monies as instructed by the
redeeming Shareholders;
(f) Effect transfers of Shares by the registered owners thereof upon
receipt of appropriate instructions;
(g) Prepare and transmit payments for dividends and distributions
declared by the Fund on behalf of the applicable Portfolio;
(h) Issue replacement certificates for those certificates alleged to
have been lost, stolen or destroyed upon receipt by the Transfer Agent
of indemnification satisfactory to the Transfer Agent and protecting
the Transfer Agent and the Fund, and the Transfer Agent at its option,
may issue replacement certificates in place of mutilated stock
certificates upon presentation thereof and without such indemnity;
(i) Maintain records of account for and advise the Fund and its
Shareholders as to the foregoing records of account including the
master securityholder file (containing the names, addresses and account
positions of all shareholders of record) as required under the
Securities Exchange Act of 1934; and
(j) Record the issuance and redemption of Shares of the Fund and
maintain pursuant to SEC Rule 17Ad-10(e) a record of the total number
of Shares of the Fund which are authorized, based upon data provided to
it by the Fund, and issued and outstanding. The Transfer Agent shall
also provide the Fund and its designated agents on a regular basis with
the total number of Shares which are authorized and issued and
outstanding and shall have no obligation, when recording the issuance
of Shares, to monitor the issuance of such Shares or to take cognizance
of any laws relating to the issue or sale of such Shares, which
functions shall be the sole responsibility of the Fund.
1.2 Additional Services. In addition to, and neither in lieu nor in
contravention of, the services set forth in the above paragraph, the
Transfer Agent shall perform the following services:
(a) Other Customary Services. Perform the customary services of a
transfer agent, dividend disbursing agent, custodian of certain
retirement plans and, as relevant, agent in connection with
accumulation, open-account or similar plans (including without
limitation any periodic investment plan or periodic withdrawal
program), including but not limited to: maintaining all Shareholder
accounts, preparing Shareholder meeting lists, mailing Shareholder
proxies, Shareholder reports and prospectuses to current Shareholders,
withholding taxes on U.S. resident and non-resident alien accounts,
preparing and filing U.S. Treasury Department Forms 1099 and other
appropriate forms required with respect to dividends and distributions
by federal authorities for all Shareholders, preparing and mailing
confirmation forms and statements of account to Shareholders for all
purchases and redemptions of Shares and other confirmable transactions
in Shareholder accounts, preparing and mailing activity statements for
Shareholders, and providing Shareholder account information and (ii)
provide a sales report which will enable the Fund to monitor the total
number of Shares sold in each State;
(b) Control Book (also known as "Super Sheet"). Maintain a daily record
and produce a daily report for the Fund of all transactions and
receipts and disbursements of money and securities and deliver a copy
of such report for the Fund for each business day to the Fund and its
designated agents no later than 9:00 AM Eastern Time, or such earlier
time as the Fund may reasonably require, on the next business day;
(c) "Blue Sky" Reporting. The Fund shall (i) identify to the Transfer
Agent in writing those transactions and assets to be treated as exempt
from blue sky reporting for each State and (ii) verify the
establishment of transactions for each State on the system prior to
activation and thereafter monitor the daily activity for each State.
The responsibility of the Transfer Agent for the Fund's blue sky State
registration status is solely limited to the initial establishment of
transactions subject to blue sky compliance by the Fund and providing a
system which will enable the Fund to monitor the total number of Shares
sold in each State;
(d) National Securities Clearing Corporation (the "NSCC"). (i) accept
and effectuate the registration and maintenance of accounts through
Networking and the purchase, redemption, transfer and exchange of
shares in such accounts through Fund/SERV (Networking and Fund/SERV
being programs operated by the NSCC on behalf of NSCC's participants,
including the Fund), in accordance with, instructions transmitted to
and received by the Transfer Agent by transmission from NSCC on behalf
of broker-dealers and banks which have been established by, or in
accordance with the instructions of authorized persons, as hereinafter
defined on the dealer file maintained by the Transfer Agent; (ii) issue
instructions to Fund's banks for the settlement of transactions between
the Fund and NSCC (acting on behalf of its broker-dealer and bank
participants); (iii) provide account and transaction information from
the affected Fund's records on DST Systems, Inc. computer system TA2000
("TA2000 System") in accordance with NSCC's Networking and Fund/SERV
rules for those broker-dealers; and (iv) maintain Shareholder accounts
on TA2000 System through Networking;
(e) New Procedures. New procedures as to who shall provide certain of
these services in Section 1 may be established in writing from time to
time by agreement between the Fund and the Transfer Agent. Upon
agreement of the parties, the Transfer Agent may at times perform only
a portion of these services and the Fund or its agent may perform these
services on the Fund's behalf; and
(f) Additional Telephone Support Services. If the parties elect to have
the Transfer Agent provide additional telephone support services under
this Agreement, the parties will agree to such services, fees and
sub-contracting as stated in Schedule 1.2(f) entitled "Telephone
Support Services" attached hereto. Such services are separate from any
disaster agreement services agreed upon by the parties;
(g) Third Party Check Procedures. The Transfer Agent shall follow the
procedures set forth in Schedule 1.2(g) hereto (the "Third Party Check
Procedures") with respect to the review and processing of checks for
the purchase of shares that are not payable to the Fund (or Portfolio)
or the Transfer Agent ("Third Party Checks");
1.3 Retirement Accounts. The Fund has developed certain retirement account
materials (hereinafter collectively called the "Fund Prototypes") that
may be used by an individual ("Participant") who desires to establish a
Traditional XXX, Xxxx XXX, SEP XXX or 403(b)(7)-retirement account
(collectively, "Retirement Account(s)"). The Fund desires to appoint
the Transfer Agent as custodian of any Retirement Account established
using the Fund Prototypes and the Transfer Agent desires to accept such
appointment. The parties agree as follows:
(a) As custodian of the Retirement Accounts, the Transfer Agent will be
designated as the owner, on the records of the Fund;
(b) Records of the custodian's ownership of Shares of the Fund will be
maintained by the Transfer Agent for such Shares in the name of the
Transfer Agent as custodian (or its nominee) and no physical Shares
will be issued.
(c) Under the terms of each Fund Prototype, the Transfer Agent as
custodian has no investment responsibility for the selection of
investments for a Retirement Account and the Transfer Agent will have
no liability for any investments made for a Retirement Account other
than to maintain custody of the investments subject to the terms of
this Agreement. The Fund will not state or make any representations to
the contrary hereof.
(d) The Transfer Agent will not serve as trustee or plan administrator
of any Retirement Account, or in any other administrative or other
capacity except as custodian thereof. The Transfer Agent will not keep
records of Retirement Accounts or maintain any other records except
those that are necessary to serve as custodian or as transfer agent
pursuant to this Agreement. The Fund will not state or make any
representations to the contrary hereof.
(e) The Fund will upon reasonable advance notice make available access
to its facilities and access to or copies of such records to the
Transfer Agent as the Transfer Agent may request in order that the
Transfer Agent may determine that the Fund is properly performing its
duties and obligations hereunder. The Transfer Agent's right of access
under this provision will include access to any service provider or
service bureau performing any of the Fund's duties and obligations
under this Agreement on behalf of the Fund.
(f) As agreed by the Fund and the Transfer Agent, the Fund may share in
the annual maintenance fee with respect to each Retirement Account.
1.4 Review and Maintenance of Fund Prototypes or Account Materials.
(a) The Fund agrees that the Fund Prototypes will comply with
applicable sections of the Internal Revenue Code of 1986 (the "Code")
and regulations promulgated pursuant to the Code in effect at the time.
The Fund will be responsible for establishing, maintaining and updating
the Fund Prototypes in compliance with the Code and all other
applicable Federal or state law or regulations, when changes in the law
require such updating.
(b) The Fund agrees that any modifications made by the Fund to the Fund
Prototypes without the Transfer Agent's written consent shall not
increase the liabilities or responsibilities of the Transfer Agent as
custodian or limit the Transfer Agent's ability to resign as custodian
as provided under Section 1.5 below. The Fund will furnish the Transfer
Agent with a copy of the Fund Prototypes. The Transfer Agent shall not
be required to review, comment or advise on such Fund Prototypes.
1.5 Resignation or Removal of Custodian
(a) If either party chooses to terminate pursuant to Section 13 of the
Agreement the Transfer Agent may thereupon resign as custodian in
respect to any or all of the Retirement Accounts upon thirty (30) days'
prior written notice to the Fund. In such an event, the Fund will
promptly distribute the notice of the custodian's resignation to such
persons and in such manner as are called for under the applicable
provisions of the Retirement Account and in form and content
satisfactory to and signed by the Transfer Agent. The Fund shall be
responsible to obtain a successor custodian for all Retirement
Accounts.
(b) If the Fund chooses to discontinue performing any of its duties and
obligations with respect to any or all Retirement Accounts, it will
give the Transfer Agent at least one hundred twenty (120) days' written
notice prior to such discontinuance. The Transfer Agent may thereupon
resign as custodian in respect to any or all Retirement Accounts by
providing (30) days' prior written notice to the Fund. In such an
event, the Fund shall be responsible to obtain a successor custodian
for the Retirement Accounts. Upon written acceptance by the successor
custodian, the Fund will promptly distribute the notice of the
Custodian's resignation to such persons and in such manner as are
called for under the applicable provisions of the Retirement Account
and in form and content satisfactory to and signed by the Bank.
(c) If at any time and for any reason the Transfer Agent chooses to
resign as custodian of any or all Retirement Accounts, it will give the
Fund at least thirty (30) days' prior written notice. In connection
with Transfer Agent resignation hereunder or pursuant to Sections
1.5(a), 1.5(b), the Transfer Agent may, but is not required to,
designate a successor custodian by written notice to the Fund, and the
Fund will be deemed to have consented to such successor unless the Fund
designates a different successor custodian and provides written notice
thereof together with such a different successor's written acceptance
by such date as the Transfer Agent specifies in its original notice to
the Fund provided that the Fund will have a minimum of thirty (30) days
to designate a different successor. The Fund will promptly distribute
the notice of the Transfer Agent's resignation as custodian to such
persons and in such manner as are called for under the applicable
provisions of the Retirement Account and in form and content
satisfactory to and signed by the Transfer Agent.
(d) If within thirty (30) days (or such longer time as the custodian
may agree to in writing) after resignation by the custodian, the Fund
or the Transfer Agent has not appointed a successor custodian who has
accepted such appointment in writing, the Fund shall within a further
period of thirty (30) days apply to a court of competent jurisdiction
for appointment of a successor custodian, provided that if (i) the Fund
shall have failed to have made such application within such period or
(ii) the court shall have dismissed such application without having
made such appointment, and (iii) no successor custodian shall have then
accepted appointment , then (iv) termination of the custodian's
responsibilities shall be effected by distributing all assets of the
Retirement Account in a single payment in cash or in kind to each
Participant, subject to the Transfer Agent's right as custodian to
reserve such funds as it may deem advisable for payment of all its
fees, compensation, costs and expenses or for payment of any other
liabilities constituting a charge on or against the assets of
Retirement Accounts or on or against the custodian. Any amounts
remaining after payment of such costs shall be delivered to the
successor custodian, if any.
(e) Upon appointment of and acceptance by a successor custodian under
this Section 1.5, the custodian shall transfer all assets in book entry
form relating to the Retirement Accounts to the successor custodian.
1.6 Applications and Correspondence
The Transfer Agent will execute any instruments and documents in regard
to the Retirement Accounts (including correspondence with various
persons such as employers, Participants and beneficiaries) which the
Fund submits to the Transfer Agent for that purpose. In no event will
the Fund sign the Transfer Agent's name on any application or other
document without the Transfer Agent's prior written approval.
2. All Non-Same Day (TD+1) Processing/Settlement Environments
2.1 Third Party Administrators for Defined Contribution Plans
The Fund may decide to make available to certain of its customers, a
qualified plan program (the "Program") pursuant to which the customers
("Employers") may adopt certain plans of deferred compensation ("Plan
or Plans") for the benefit of the individual Plan participant (the
"Plan Participant"), such Plan(s) being qualified under Section 401(a)
of the Internal Revenue Code of 1986, as amended ("Code") and
administered by third party administrators which may be plan
administrators as defined in the Employee Retirement Income Security
Act of 1974, as amended (the "TPA(s)"). In accordance with the
procedures established in the initial Schedule 2.1 entitled "Third
Party Administrator Procedures", as may be amended by the Transfer
Agent and the Fund from time to time ("Schedule 2.1"), the Transfer
Agent shall:
(a) Treat Shareholder accounts established by the Plans in the name of
the Trustees, Plans or TPAs as the case may be as omnibus accounts;
(b) Maintain omnibus accounts on its records in the name of the TPA or
its designee as the Trustee for the benefit of the Plan; and
(c) Perform all services under Section 1 as transfer agent of the Funds
and not as a record-keeper for the Plans.
2.2 Non-Same Day (TD+1) Order Processing
The Fund may authorize broker-dealers and their designated
intermediaries to receive purchase and redemption orders from their
customers on the Fund's behalf for purposes of Rule 22c-1, so that any
such customer will receive the share price next computed by the Fund
after the time at which such customer places its order with the
broker-dealer or the designated intermediary. If the authorized
broker-dealer, is prevented from transmitting Day 1 trades to the
Transfer Agent due to unforeseen circumstances, such as computer system
failures, natural catastrophes, or other emergencies or human error
then the broker-dealer may transmit such trades the next day (TD+1) at
a time mutually agreed upon by the Fund, the broker-dealer and the
Transfer Agent.
2.3 All non-same day (TD+1) transactions identified under Section 2 of this
Agreement shall be deemed exception services ("Exception Services")
when such transactions:
(a) Require the Transfer Agent to use methods and procedures other than
those usually employed by the Transfer Agent to perform services under
Section 1 of this Agreement;
(b) Involve the provision of information to the Transfer Agent after
the commencement of the nightly processing cycle of the TA2000 System;
or
(c) Require more manual intervention by the Transfer Agent, either in
the entry of data or in the modification or amendment of reports
generated by the TA2000 System than is usually required by
non-retirement plan and pre-nightly transactions.
3. Fees and Expenses
3.1 Fee Schedule. For the performance by the Transfer Agent pursuant to
this Agreement, the Fund agrees on behalf of each of the Portfolios to
pay the Transfer Agent an annual maintenance fee for each Shareholder
account as set forth in the attached fee schedule ("Schedule 3.1").
Such fees and out-of-pocket expenses and advances identified under
Section 3.2 below may be changed from time to time subject to mutual
written agreement between the Fund and the Transfer Agent.
3.2 Out-of-Pocket Expenses. In addition to the fee paid under Section 3.1
above, the Fund agrees on behalf of each of the Portfolios to reimburse
the Transfer Agent for out-of-pocket expenses, including but not
limited to confirmation production, postage, forms, telephone,
microfilm, microfiche, mailing and tabulating proxies (by outside
vendor), records storage, or advances incurred by the Transfer Agent
for the items set out in Schedule 3.1 attached hereto. In addition, any
other expenses incurred by the Transfer Agent at the request or with
the consent of the Fund, will be reimbursed by the Fund on behalf of
the applicable Portfolio.
3.3 Postage. Postage for mailing of dividends, proxies, Fund reports and
other mailings to all shareholder accounts shall be billed by the
Transfer Agent to the Fund.
3.4 Invoices. The Fund agrees to pay all fees and reimbursable expenses
within thirty (30) days following the receipt of the respective billing
notice, except for any fees or expenses that are subject to good faith
dispute. In the event of such a dispute, the Fund may only withhold
that portion of the fee or expense subject to the good faith dispute.
The Fund shall notify the Transfer Agent in writing within twenty-one
(21) calendar days following the receipt of each billing notice if the
Fund is disputing any amounts in good faith. If the Fund does not
provide such notice of dispute within the required time, the billing
notice will be deemed accepted by the Fund. The Fund shall settle such
disputed amounts within five (5) days of the day on which the parties
agree on the amount to be paid by payment of the agreed amount. If no
agreement is reached, then such disputed amounts shall be settled as
may be required by law or legal process.
3.5 Late Payments. The Fund shall pay undisputed amounts on Transfer
Agent's invoices (for fees and reimbursable expenses) within thirty
(30) days of the date such invoice was sent. If any undisputed amount
in an invoice of the Transfer Agent (for fees or reimbursable expenses)
is not paid when due, the Fund shall pay the Transfer Agent interest
thereon (from the due date to the date of payment) at a per annum rate
equal to one percent (1.0%) plus the Prime Rate (that is, the base rate
on corporate loans posted by large domestic banks) published by The
Wall Street Journal (or, in the event such rate is not so published, a
reasonably equivalent published rate selected by the Fund) on the first
day of publication during the month when such amount was due.
Notwithstanding any other provision hereof, such interest rate shall be
no greater than permitted under applicable provisions of Massachusetts
law.
4. Representations and Warranties of the Transfer Agent
The Transfer Agent represents and warrants to the Fund that:
4.1 It is a trust company duly organized and existing and in good standing
under the laws of The Commonwealth of Massachusetts.
4.2 It is duly qualified to carry on its business in The Commonwealth of
Massachusetts.
4.3 It is empowered under applicable laws and by its Charter and By-Laws to
enter into and perform this Agreement.
4.4 All requisite corporate proceedings have been taken to authorize it to
enter into and perform this Agreement.
4.5 It has and will continue to have access to the necessary facilities,
equipment and personnel to perform its duties and obligations under
this Agreement.
5. Representations and Warranties of the Fund
The Fund represents and warrants to the Transfer Agent that:
5.1 It is a business trust duly organized and existing and in good standing
under the laws of The Commonwealth of Massachusetts.
5.2 It is empowered under applicable laws and by its Declaration of Trust
and By-Laws to enter into and perform this Agreement.
5.3 All corporate proceedings required by said Declaration of Trust and
By-Laws have been taken to authorize it to enter into and perform this
Agreement.
5.4 It is an open-end and diversified management investment company
registered under the Investment Company Act of 1940, as amended.
5.5 A registration statement under the Securities Act of 1933, as amended
on behalf of each of the Portfolios is currently effective and will
remain effective, and appropriate state securities law filings have
been made and will continue to be made, with respect to all Shares of
the Fund being offered for sale.
6. Wire Transfer Operating Guidelines/Articles 4A of the Uniform
Commercial Code
6.1 Obligation of Sender. The Transfer Agent is authorized to promptly
debit the appropriate Fund account(s) upon the receipt of a payment
order in compliance with the selected security procedure (the "Security
Procedure") chosen for funds transfer and in the amount of money that
the Transfer Agent has been instructed to transfer. The Transfer Agent
shall execute payment orders in compliance with the Security Procedure
and with the Fund instructions on the execution date provided that such
payment order is received by the customary deadline for processing such
a request, unless the payment order specifies a later time. All payment
orders and communications received after this the customary deadline
will be deemed to have been received the next business day.
6.2 Security Procedure. The Fund acknowledges that the Security Procedure
it has designated on the Fund Selection Form was selected by the Fund
from security procedures offered by the Transfer Agent. The Fund shall
restrict access to confidential information relating to the Security
Procedure to authorized persons as communicated to the Transfer Agent
in writing. The Fund must notify the Transfer Agent immediately if it
has reason to believe unauthorized persons may have obtained access to
such information or of any change in the Fund's authorized personnel.
The Transfer Agent shall verify the authenticity of all Fund
instructions according to the Security Procedure.
6.3 Account Numbers. The Transfer Agent shall process all payment orders on
the basis of the account number contained in the payment order. In the
event of a discrepancy between any name indicated on the payment order
and the account number, the account number shall take precedence and
govern.
6.4 Rejection. The Transfer Agent reserves the right to decline to process
or delay the processing of a payment order which (a) is in excess of
the collected balance in the account to be charged at the time of the
Transfer Agent's receipt of such payment order; (b) if initiating such
payment order would cause the Transfer Agent, in the Transfer Agent's
sole judgement, to exceed any volume, aggregate dollar, network, time,
credit or similar limits which are applicable to the Transfer Agent; or
(c) if the Transfer Agent, in good faith, is unable to satisfy itself
that the transaction has been properly authorized.
6.5 Cancellation Amendment. The Transfer Agent shall use reasonable efforts
to act on all authorized requests to cancel or amend payment orders
received in compliance with the Security Procedure provided that such
requests are received in a timely manner affording the Transfer Agent
reasonable opportunity to act. However, the Transfer Agent assumes no
liability if the request for amendment or cancellation cannot be
satisfied.
6.6 Errors. The Transfer Agent shall assume no responsibility for failure
to detect any erroneous payment order provided that the Transfer Agent
complies with the payment order instructions as received and the
Transfer Agent complies with the Security Procedure. The Security
Procedure is established for the purpose of authenticating payment
orders only and not for the detection of errors in payment orders.
6.7 Interest. The Transfer Agent shall assume no responsibility for lost
interest with respect to the refundable amount of any unauthorized
payment order, unless the Transfer Agent is notified of the
unauthorized payment order within thirty (30) days of notification by
the Transfer Agent of the acceptance of such payment order.
6.8 ACH Credit Entries/Provisional Payments. When the Fund initiates or
receives Automated Clearing House credit and debit entries pursuant to
these guidelines and the rules of the National Automated Clearing House
Association and the New England Clearing House Association, the
Transfer Agent will act as an Originating Depository Financial
Institution and/or receiving depository Financial Institution, as the
case may be, with respect to such entries. Credits given by the
Transfer Agent with respect to an ACH credit entry are provisional
until the Transfer Agent receives final settlement for such entry from
the Federal Reserve Bank. If the Transfer Agent does not receive such
final settlement, the Fund agrees that the Transfer Agent shall receive
a refund of the amount credited to the Fund in connection with such
entry, and the party making payment to the Fund via such entry shall
not be deemed to have paid the amount of the entry.
6.9 Confirmation. Confirmation of Transfer Agent's execution of payment
orders shall ordinarily be provided within twenty four (24) hours
notice of which may be delivered through the Transfer Agent's
proprietary information systems, or by facsimile or call-back. Fund
must report any objections to the execution of an order within thirty
(30) days.
7. Data Access and Proprietary Information
7.1 The Fund acknowledges that the databases, computer programs, screen
formats, report formats, interactive design techniques, and
documentation manuals furnished to the Fund by the Transfer Agent as
part of the Fund's ability to access certain Fund-related data
("Customer Data") maintained by the Transfer Agent on databases under
the control and ownership of the Transfer Agent or other third party
("Data Access Services") constitute copyrighted, trade secret, or other
proprietary information (collectively, "Proprietary Information") of
substantial value to the Transfer Agent or other third party. In no
event shall Proprietary Information be deemed Customer Data, nor shall
Customer Data be deemed Proprietary Information. The Fund agrees to
treat all Proprietary Information as proprietary to the Transfer Agent
and further agrees that it shall not divulge any Proprietary
Information to any person or organization except as may be provided
hereunder. Without limiting the foregoing, the Fund agrees for itself
and its employees and agents to:
(a) Use such programs and databases (i) solely on the Fund's computers,
or (ii) solely from equipment at the location agreed to between the
Fund and the Transfer Agent and (iii) solely in accordance with the
Transfer Agent's applicable user documentation;
(b) Refrain from copying or duplicating in any way (other than in the
normal course of performing processing on the Fund's computer(s)), the
Proprietary Information (however, the Fund is not prohibited from
printing screens);
(c) Refrain from obtaining unauthorized access to any portion of the
Proprietary Information, and if such access is inadvertently obtained,
to inform in a timely manner of such fact and dispose of such
information in accordance with the Transfer Agent's instructions;
(d) Refrain from causing or allowing information transmitted from the
Transfer Agent's computer to the Fund's terminal to be retransmitted to
any other computer terminal or other device except as expressly
permitted by the Transfer Agent (such permission not to be unreasonably
withheld);
(e) Allow the Fund to have access only to those authorized transactions
as agreed to between the Fund and the Transfer Agent; and
(f) Honor all reasonable written requests made by the Transfer Agent
to protect at the Transfer Agent's expense the rights of the Transfer
Agent in Proprietary Information at common law, under federal
copyright law and under other federal or state law.
7.2 Proprietary Information shall not include all or any portion of any of
the foregoing items that: (i) are or become publicly available without
breach of this Agreement; (ii) are released for general disclosure by a
written release by the Transfer Agent; (iii) are already in the
possession of the receiving party at the time or receipt without
obligation of confidentiality or breach of this Agreement, or (iv) are
required to be disclosed pursuant to applicable law or pursuant to an
order of a court of competent jurisdiction or other governmental agency
having appropriate authority (in which case the Fund shall, to the
extent possible, provide the Transfer Agent with timely notice prior to
any such disclosure). The Fund may make disclosures that are necessary
or convenient for purposes of enforcing its rights against the Transfer
Agent and may disclose Proprietary Information to its attorneys,
accountants, investment officer and other professional advisers
provided if the Fund selected such persons, the Fund shall have
exercised due care in selecting and monitoring the same.
7.3 The Fund acknowledges that its obligation to protect the Transfer
Agent's Proprietary Information is essential to the business interest
of the Transfer Agent and that the disclosure of such Proprietary
Information in breach of this Agreement would cause the Transfer Agent
immediate, substantial and irreparable harm, the value of which would
be extremely difficult to determine. Accordingly, the parties agree
that, in addition to any other remedies that may be available in law,
equity, or otherwise for the disclosure or use of the Proprietary
Information in breach of this Agreement, the Transfer Agent shall be
entitled to seek and obtain a temporary restraining order, injunctive
relief, or other equitable relief against the continuance of such
breach.
7.4 If the Fund notifies the Transfer Agent that any of the Data Access
Services do not operate in material compliance with the most recently
issued user documentation for such services, the Transfer Agent shall
endeavor in a timely manner to correct such failure. Organizations from
which the Transfer Agent may obtain certain data included in the Data
Access Services are solely responsible for the contents of such data
and the Fund agrees to make no claim against the Transfer Agent arising
out of the contents of such third-party data, including, but not
limited to, the accuracy thereof. DATA ACCESS SERVICES AND ALL COMPUTER
PROGRAMS AND SOFTWARE SPECIFICATIONS USED IN CONNECTION THEREWITH ARE
PROVIDED ON AN AS IS, AS AVAILABLE BASIS. THE TRANSFER AGENT EXPRESSLY
DISCLAIMS ALL WARRANTIES EXCEPT THOSE EXPRESSLY STATED HEREIN
INCLUDING, BUT NOT LIMITED TO, THE IMPLIED WARRANTIES OF
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.
7.5 If the transactions available to the Fund include the ability to
originate electronic instructions to the Transfer Agent in order to (i)
effect the transfer or movement of cash or Shares or (ii) transmit
Shareholder information or other information, then in such event the
Transfer Agent shall be entitled to rely on the validity and
authenticity of such instruction without undertaking any further
inquiry as long as such instruction is undertaken in conformity with
security procedures established by the Transfer Agent from time to
time.
7.6 Each party shall take reasonable efforts to advise its employees of
their obligations pursuant to this Section 7. The obligations of this
Section shall survive any earlier termination of this Agreement.
8. Indemnification
8.1 The Transfer Agent shall not be responsible for, and the Fund shall on
behalf of the applicable Portfolio indemnify and hold the Transfer
Agent harmless from and against, any and all losses, damages, costs,
charges, counsel fees, payments, expenses and liability arising out of
or attributable to:
(a) All actions of the Transfer Agent or its agents or subcontractors
required to be taken pursuant to this Agreement (including the defense
of any law suit in which the Transfer Agent or affiliate is a named
party), provided that such actions are taken in good faith and without
negligence or willful misconduct;
(b) The Fund's lack of good faith, negligence or willful misconduct
which arise out of the breach of any representation or warranty of the
Fund hereunder;
(c) The reliance upon, and any subsequent use of or action taken or
omitted, by the Transfer Agent, or its agents or subcontractors on: (i)
any information, records, documents, data, stock certificates or
services, which are received by the Transfer Agent or its agents or
subcontractors by machine readable input, facsimile, CRT data entry,
electronic instructions or other similar means authorized by the Fund,
and which have been prepared, maintained or performed by the Fund or
any other person or firm on behalf of the Fund including but not
limited to any broker-dealer, TPA or previous transfer agent; (ii) any
instructions or requests of the Fund or any of its officers; (iii) any
instructions or opinions of external legal counsel with respect to any
matter arising in connection with the services to be performed by the
Transfer Agent under this Agreement which are provided to the Transfer
Agent after consultation with such legal counsel; or (iv) any paper or
document, reasonably believed to be genuine, authentic, or signed by
the proper person or persons unless the Transfer Agent fails to follow
procedures agreed upon by the Fund and the Transfer Agent;
(d) The offer or sale of Shares in violation of federal or state
securities laws or regulations requiring that such Shares be registered
or in violation of any stop order or other determination or ruling by
any federal or any state agency with respect to the offer or sale of
such Shares;
(e) The negotiation and processing of any checks including without
limitation for deposit into the Fund's demand deposit account
maintained by the Transfer Agent provided that the proximate cause of
any claim hereunder is not due to the Transfer Agent's failure to
comply with Section 1.2(g) hereunder; or
(f) Upon the Fund's request entering into any agreements required by
the National Securities Clearing Corporation (the "NSCC") for the
transmission of Fund or Shareholder data through the NSCC clearing
systems, provided the Transfer Agent's actions and omissions in
relation to any such agreements are taken in good faith and without
negligence or willful misconduct.
8.2 In order that the indemnification provisions contained in this Section
8 shall apply, upon the assertion of a claim for which the Fund may be
required to indemnify the Transfer Agent, the Transfer Agent shall
promptly notify the Fund of such assertion, and shall keep the Fund
advised with respect to all developments concerning such claim. The
Fund shall have the option to participate with the Transfer Agent in
the defense of such claim or to defend against said claim in its own
name or in the name of the Transfer Agent. The Transfer Agent shall in
no case confess any claim or make any compromise in any case in which
the Fund may be required to indemnify the Transfer Agent except with
the Fund's prior written consent.
9. Standard of Care
The Transfer Agent shall at all times act in good faith and agrees to
use reasonable care in performing services under this Agreement, but
assumes no responsibility and shall not be liable for loss or damage
due to errors, including encoding and payment processing errors, unless
said errors are caused by its negligence, bad faith, or willful
misconduct or that of its employees or agents. The parties agree that
any encoding or payment processing errors shall be governed by this
standard of care and Section 4-209 of the Uniform Commercial Code is
superseded by Section 9 of this Agreement. This standard of care also
shall apply to Exception Services, as defined in Section 2.3 herein,
but such application shall take into consideration the manual
processing involved in, and time sensitive nature of, Exception
Services.
10. Year 2000
The Transfer Agent will take reasonable steps to ensure that its
products (and those of its third-party suppliers) reflect the available
technology to offer products that are Year 2000 ready, including, but
not limited to, century recognition of dates, calculations that
correctly compute same century and multi century formulas and date
values, and interface values that reflect the date issues arising
between now and the next one-hundred years, and if any changes are
required, the Transfer Agent will make the changes to its products at a
price to be agreed upon by the parties and in a commercially reasonable
time frame and will require third-party suppliers to do likewise.
11. Confidentiality
11.1 The Transfer Agent and the Fund agree that they will not, at any time
during the term of this Agreement or after its termination, reveal,
divulge, or make known to any person, firm, corporation or other
business organization, any customers' lists, trade secrets, cost
figures and projections, profit figures and projections, or any other
secret or confidential information whatsoever, whether of the Transfer
Agent or of the Fund, used or gained by the Transfer Agent or the Fund
during performance under this Agreement. The Fund and the Transfer
Agent further covenant and agree to retain all such knowledge and
information acquired during and after the term of this Agreement
respecting such lists, trade secrets, or any secret or confidential
information whatsoever in trust for the sole benefit of the Transfer
Agent or the Fund and their successors and assigns. In the event of
breach of the foregoing by either party, the remedies provided by
Section 7.3 shall be available to the party whose confidential
information is disclosed. The above prohibition of disclosure shall not
apply to the extent that the Transfer Agent must disclose such data to
its sub-contractor or Fund agent for purposes of providing services
under this Agreement and shall not apply to each party's disclosure of
its own secret and/or confidential information. In the event that the
Fund replaces the Transfer Agent, the Fund has the right to deliver to
any successor transfer agent, and authorize the successor transfer
agent to use and disclose all Customer Data. Confidential information
shall not include all or any portion of any of the foregoing items that
are required to be disclosed pursuant to applicable law or pursuant to
an order of a court of competent jurisdiction or other governmental
agency having appropriate authority (in which case the disclosing party
shall, to the extent possible, provide the non-disclosing party with
timely notice prior to any such disclosure).
11.2 In the event that any requests or demands are made for the inspection
of the Shareholder records of the Fund, other than request for records
of Shareholders pursuant to standard subpoenas from state or federal
government authorities (i.e., divorce and criminal actions), the
Transfer Agent will endeavor forthwith to notify the Fund and to secure
instructions from an authorized officer of the Fund as to such
inspection. The Transfer Agent expressly reserves the right, however,
to exhibit the Shareholder records to any person whenever it is advised
by counsel that it may be held liable for the failure to exhibit the
Shareholder records to such person or if required by law or court
order. The Transfer Agent in its role as record-keeper also undertakes
to use best efforts to reasonably assist the Fund in any proceeding to
quash a subpoena, avoid or limit any disclosure of Fund data, or to
obtain confidential treatment for Fund data.
12. Covenants of the Fund and the Transfer Agent
12.1 The Fund shall promptly furnish to the Transfer Agent the following:
(a) A certified copy of the resolution of the Board of Trustees of the
Fund authorizing the appointment of the Transfer Agent and the
execution and delivery of this Agreement; and
(b) A copy of the Declaration of Trust and By-Laws of the Fund and all
amendments thereto. The Transfer Agent acknowledges that these
documents, effective as of the date of this Agreement, have been
provided to the Transfer Agent by the Fund.
12.2 The Transfer Agent hereby agrees to establish and maintain facilities
and procedures reasonably acceptable to the Fund for safekeeping of
stock certificates, check forms and facsimile signature imprinting
devices, if any; and for the preparation or use, and for keeping
account of, such certificates, forms and devices.
12.3 The Transfer Agent shall keep records relating to the services to be
performed hereunder, in the form and manner as it may deem advisable.
To the extent required by Section 31 of the Investment Company Act of
1940, as amended, and the Rules thereunder, the Transfer Agent agrees
that all such records prepared or maintained by the Transfer Agent
relating to the services to be performed by the Transfer Agent
hereunder are the property of the Fund and will be preserved,
maintained and made available in accordance with such Section and
Rules, and will be surrendered promptly to the Fund on and in
accordance with its request.
12.4 The Fund shall provide the Transfer Agent with a certified copy of the
resolutions of the Board of Trustees of the Fund identifying the
persons authorized to give instructions and to generally act on behalf
of the Fund under this Agreement. All references in this Agreement to
instructions or requests of the Fund or records, papers, or documents
furnished by the Fund shall require action solely by such authorized
persons.
13. Termination of Agreement
13.1 Term. The initial term of this Agreement (the "Initial Term") shall
expire December 31, 2001 unless terminated pursuant to the provisions
of this Section 13. Unless a terminating party gives written notice to
the other party at least one hundred and twenty (120) days before the
expiration of the Initial Term, this Agreement will renew automatically
from year to year (each such year-to-year renewal term a "Renewal
Term"). At least one hundred and twenty (120) days before the
expiration of the Initial Term or a Renewal Term the parties to this
Agreement will agree upon a Fee Schedule for the upcoming Renewal Term.
13.2 Early Termination. Notwithstanding anything contained in this
Agreement to the contrary, should the Fund desire to move any of its
services provided by the Transfer Agent hereunder to a successor
service provider prior to the expiration of the then current Initial
or Renewal Term, or without the required notice, the Transfer Agent
shall make a good faith effort to facilitate the conversion on such
prior date; however, there can be no guarantee or assurance that the
Transfer Agent will be able to facilitate a conversion of services on
such prior date. In connection with the foregoing, should services be
converted to a successor service provider, or if the Fund is
liquidated or its assets merged or purchased or the like with or by
another entity which does not utilize the services of the Transfer
Agent, the Fund shall pay the lesser of the last three months fees
incurred or the fees payable to the Transfer Agent shall be calculated
as if the services had been performed by the Transfer Agent until the
expiration of the then current Initial or Renewal Term and calculated
at the asset and/or Shareholder account levels, as the case may be, on
the date notice of termination was given to the Transfer Agent, and
the payment of all fees to the Transfer Agent as set forth herein
shall be accelerated to the business day immediately prior to the
conversion or termination of services.
13.3 Expiration of Term. After the expiration of the Initial Term or Renewal
Term whichever currently in effect, should either party exercise its
right to terminate, all out-of-pocket expenses or costs associated with
the movement of records and material will be borne by the Fund.
Additionally, the Transfer Agent reserves the right to charge for any
other reasonable expenses associated with such termination.
13.4 Confidential Information. Upon termination of this Agreement, each
party shall return to the other party all copies of confidential or
proprietary materials or information received from such other party
hereunder, other than materials or information required to be retained
by such party under applicable laws or regulations. The Fund may
require the Transfer Agent to deliver to any successor transfer agent
all Customer Data of the Fund.
13.5 Unpaid Invoices. The Transfer Agent may terminate this Agreement
immediately upon an unpaid invoice payable by the Fund to the Transfer
Agent being outstanding for more than ninety (90) days, except with
respect to any amount subject to a good faith dispute within the
meaning of Section 3.4 of this Agreement. If the Transfer Agent intends
to exercise its rights of termination under Section 13.5, the Transfer
Agent shall provide the Fund and its legal counsel as stated in Section
16.12 with thirty (30) days notice prior to termination, during which
period the Fund may cancel the Transfer Agent's right to terminate this
Agreement by settling all outstanding invoices.
13.6 Bankruptcy. Either party hereto may terminate this Agreement by notice
to the other party, effective at any time specified therein, in the
event that (a) the other party ceases to carry on its business or (b)
an action is commenced by or against the other party under Title 11 of
the United States Code or a receiver, conservator or similar officer is
appointed for the other party and such suit, conservatorship or
receivership is not discharged within thirty (30) days.
14. Assignment and Third Party Beneficiaries
14.1 Except as provided in Section 15.1 below neither this Agreement nor any
rights or obligations hereunder may be assigned by either party without
the written consent of the other party. Any attempt to do so in
violation of this Section shall be void. Unless specifically stated to
the contrary in any written consent to an assignment, no assignment
will release or discharge the assignor from any duty or responsibility
under this Agreement.
14.2 Except as explicitly stated elsewhere in this Agreement, nothing under
this Agreement shall be construed to give any rights or benefits in
this Agreement to anyone other than the Transfer Agent and the Fund,
and the duties and responsibilities undertaken pursuant to this
Agreement shall be for the sole and exclusive benefit of the Transfer
Agent and the Fund. This Agreement shall inure to the benefit of and be
binding upon the parties and their respective permitted successors and
assigns.
14.3 This Agreement does not constitute an agreement for a partnership or
joint venture between the Transfer Agent and the Fund. Other than as
provided in Section 15.1 and Schedule 1.2(f), neither party shall make
any commitments with third parties that are binding on the other party
without the other party's prior written consent.
15. Subcontractors
15.1 The Transfer Agent may, without further consent on the part of the
Fund, subcontract for the performance hereof with (i) Boston Financial
Data Services, Inc., a Massachusetts corporation ("Boston Financial")
which is duly registered as a transfer agent pursuant to Section
17A(c)(2) of the Securities Exchange Act of 1934, as amended, (ii) a
Boston Financial subsidiary duly registered as a transfer agent or
(iii) a Boston Financial affiliate duly registered as a transfer agent;
provided, however, that the Transfer Agent shall be fully responsible
to the Fund for the acts and omissions of Boston Financial or its
subsidiary or affiliate as it is for its own acts and omissions.
15.2 Nothing herein shall impose any duty upon the Transfer Agent in
connection with or make the Transfer Agent liable for the actions or
omissions to act of unaffiliated third parties such as by way of
example and not limitation, Airborne Services, Federal Express, United
Parcel Service, the U.S. Mails, the NSCC and telecommunication
companies, provided, if the Transfer Agent selected such company, the
Transfer Agent shall have exercised due care in selecting and
monitoring the same.
16. Miscellaneous
16.1 Amendment. This Agreement may be amended or modified by a written
agreement executed by both parties and authorized or approved by a
resolution of the Board of Trustees of the Fund.
16.2 Massachusetts Law to Apply. This Agreement shall be construed and the
provisions thereof interpreted under and in accordance with the laws of
The Commonwealth of Massachusetts.
16.3 Force Majeure. In the event either party is unable to perform its
obligations under the terms of this Agreement because of acts of God,
strikes, equipment or transmission failure or damage reasonably beyond
its control, or other causes reasonably beyond its control, such party
shall not be liable for damages to the other for any damages resulting
from such failure to perform or otherwise from such causes. The
Transfer Agent shall use its best efforts to minimize the likelihood of
such damage resulting from the events described in the immediately
preceding sentence and if such damage occurs, the Transfer Agent shall
use its best efforts with in commercially reasonable standards to
mitigate the effects of such events.
16.4 Consequential Damages. Neither party to this Agreement shall be liable
to the other party for special, indirect or consequential damages under
any provision of this Agreement or for any special, indirect or
consequential damages arising out of any act or failure to act
hereunder.
16.5 Survival. All provisions regarding indemnification, warranty,
liability, and limits thereon, and confidentiality and/or protections
of proprietary rights and trade secrets shall survive the termination
of this Agreement.
16.6 Severability. If any provision or provisions of this Agreement shall be
held invalid, unlawful, or unenforceable, the validity, legality, and
enforceability of the remaining provisions shall not in any way be
affected or impaired.
16.7 Priorities Clause. In the event of any conflict, discrepancy or
ambiguity between the terms and conditions contained in this Agreement
and any Schedules or attachments hereto, the terms and conditions
contained in this Agreement shall take precedence.
16.8 Waiver. No waiver by either party or any breach or default of any of
the covenants or conditions herein contained and performed by the other
party shall be construed as a waiver of any succeeding breach of the
same or of any other covenant or condition.
16.9 Merger of Agreement. This Agreement constitutes the entire agreement
between the parties hereto and supersedes any prior agreement with
respect to the subject matter hereof whether oral or written.
16.10 Counterparts. This Agreement may be executed by the parties hereto on
any number of counterparts, and all of said counterparts taken together
shall be deemed to constitute one and the same instrument.
16.11 Reproduction of Documents. This Agreement and all schedules, exhibits,
attachments and amendments hereto may be reproduced by any
photographic, photostatic, microfilm, micro-card, miniature
photographic or other similar process. The parties hereto each agree
that any such reproduction shall be admissible in evidence as the
original itself in any judicial or administrative proceeding, whether
or not the original is in existence and whether or not such
reproduction was made by a party in the regular course of business, and
that any enlargement, facsimile or further reproduction shall likewise
be admissible in evidence.
16.12 Notices. All notices and other communications as required or permitted
hereunder shall be in writing and sent by first class mail, postage
prepaid, addressed as follows or to such other address or addresses of
which the respective party shall have notified the other.
(a) If to State Street Bank and Trust Company, to:
State Street Bank and Trust Company
c/o Boston Financial Data Services, Inc.
0000 Xxxxxxx Xxxxxx, Xxxxx 000X
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Legal Department
Facsimile: (000) 000-0000
(b) If to the Fund, to:
CGM Capital Developments Fund
c/o Capital Growth Management Limited Partnership
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxx, President
And to:
Xxxxxxx Xxxx LLP
000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Xxxxxxxx X. Xxxxxxxxx
17. Additional Funds
In the event that the Fund establishes one or more series of Shares in
addition to the attached Schedule A with respect to which it desires to
have the Transfer Agent render services as transfer agent under the
terms hereof, it shall so notify the Transfer Agent in writing, and if
the Transfer Agent agrees in writing to provide such services, such
series of Shares shall become a Portfolio hereunder.
18. Limitations of Liability of the Trustees and Shareholders
A copy of the Declaration of Trust of the Fund is on file with the
Secretary of The Commonwealth of Massachusetts, and notice is hereby
given that this instrument is executed on behalf of the Trustees of the
Fund as Trustees and not individually and that the obligations of this
instrument are not binding upon any of the Trustees or Shareholders
individually but are binding only upon the assets and property of the
particular Portfolio of the Fund to which such obligation relates.
Notwithstanding any other provision hereof, the rights, obligations and
remedies under this Agreement of the parties hereto with respect to one
Portfolio shall relate solely to such Portfolio and shall constitute
rights, obligations and remedies only with respect to such Portfolio
and the assets of such Portfolio. No Portfolio shall have rights,
obligations and remedies with respect to any other Portfolio.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
in their names and on their behalf by and through their duly authorized
officers, as of the day and year first above written.
CGM CAPITAL DEVELOPMENT FUND
BY: /s/ Xxxxxx X. Xxxx
-----------------------------
ATTEST:
/s/ Xxxxxx Xxxx
------------------------------------
STATE STREET BANK AND TRUST COMPANY
BY: /s/ Xxxxxx X. Xxxxx
-----------------------------
Vice Chairman
ATTEST:
[illegible]
------------------------------------
SCHEDULE A
CGM Capital Development Fund
CGM CAPITAL DEVELOPMENT FUND STATE STREET BANK AND TRUST COMPANY
BY: /s/ Xxxxxx X. Xxxx BY: /s/ Xxxxxx X. Xxxxx
--------------------------- ----------------------------------
SCHEDULE 1.2(F)
ADDITIONAL TELEPHONE SUPPORT FEES AND SERVICES
Dated ____________
OPTIONAL
I. SERVICES
1. Transfer Agent and Telephone Support Functions
a. Answer telephone inquiries from [XXX 8 a.m. to 8 p.m. Boston time
Monday through Friday except Christmas Day XXX] [XXX OTHER HOLIDAY
COVERAGE AVAILABLE?XXX] from [XXX existing customers and prospective
customers XXX] of the Fund [XXX for sales literature XXX] in accordance
with the telephone script provided by the Fund.
b. Answer questions pertaining thereto the extent that such questions are
answerable based upon the information supplied to the Transfer Agent by
the Fund.
c. [XXX As the Fund and the Transfer Agent may agree in writing, the
Transfer Agent will receive calls and take written transaction requests
from shareholders of the Fund. Transfer Agent transactions include:
[XXX telephone redemptions, account maintenance, exchanges, transfers,
confirmed purchases, account balances and general inquiries XXX]. Some
transactions may result in research which will be done by the Fund.
Other calls may be referred directly to the Fund. Fax any referrals to
[XXX name of company XXX] on the same day the telephone call is
received XXX];
2. Incorporate new information into the above referenced script upon
written instructions from the Fund;
3. Maintain prospect detail information for six (6) months thereafter,
provide such information to the Fund in the form that the Fund may
reasonably request;
4. Send all literature orders for information from Boston Financial/DST
[XXX [how?] [to whom?] XXX] a minimum of [XXX one XXX] transmission per
day;
5. Provide the Fund with a [XXX daily/weekly/monthly XXX] telephone report
detailing the calls received during the [XXX day/week/month XXX];
6. [XXX Provide the Fund with monthly conversion reports as selected by
the Fund from DST's standard report package. XXX]
7. TARGET SERVICE LEVELS: Average speed of answer is fifteen (15) seconds,
abandon rate of no more than 2%, and an overall service level of 85%.
The averages will be calculated on a weekly basis.
II. SUBCONTRACTORS
1. The Transfer Agent may, without further consent on the part of the
Fund, subcontract ministerial telephone support services for the
performance hereof.
III. FEES
STATE STREET BANK AND TRUST COMPANY
BY:_______________________________ BY:______________________________
SCHEDULE 1.2(G)
1. The Transfer Agent shall reject all Third Party Checks for the
establishment of new accounts and for subsequent investments unless the
Fund provided the Transfer Agent with written instructions to process
the Third Party Checks.
2.The Transfer Agent shall scan each rejected Third Party Check as a
"CORHOT" and forward a letter together with the rejected check to the
address of record of the Shareholder.
3.If the Fund provides the Transfer Agent with written instructions to
process the Third Party Check, the Transfer Agent shall scan such
written instructions, with a copy of the Third Party Check as a "PURCH"
and shall deposit the check to cover the purchase.
SCHEDULE 2.1
THIRD PARTY ADMINISTRATOR(S) PROCEDURES
Dated January 1, 2000
1. On each Business Day, the TPA(s) shall receive, on behalf of and as agent
of the Fund(s), Instructions (as hereinafter defined) from the Plan.
Instructions shall mean as to each Fund (i) orders by the Plan for the
purchases of Shares, and (ii) requests by the Plan for the redemption of
Shares; in each case based on the Plan's receipt of purchase orders and
redemption requests by Participants in proper form by the time required by
the term of the Plan, but not later than the time of day at which the net
asset value of a Fund is calculated, as described from time to time in that
Fund's prospectus. Each Business Day on which the TPA receives Instructions
shall be a "Trade Date".
2. The TPA(s) shall communicate the TPA(s)'s acceptance of such Instructions,
to the applicable Plan.
3. On the next succeeding Business Day following the Trade Date on which it
accepted Instructions for the purchase and redemption of Shares, (TD+1),
the TPA(s) shall notify the Transfer Agent of the net amount of such
purchases or redemptions, as the case may be, for each of the Plans. In the
case of net purchases by any Plan, the TPA(s) shall instruct the Trustees
of such Plan to transmit the aggregate purchase price for Shares by wire
transfer to the Transfer Agent on (TD+1). In the case of net redemptions by
any Plan, the TPA(s) shall instruct the Fund's Transfer Agent to cause the
Fund's custodian to transmit the aggregate redemption proceeds for Shares
by wire transfer to the Trustees of such Plan on (TD+1). The times at which
such notification and transmission shall occur on (TD+1) shall be as
mutually agreed upon by each Fund, the TPA(s), and the Transfer Agent.
4. The TPA(s) shall maintain separate records for each Plan, which record
shall reflect Shares purchased and redeemed, including the date and price
for all transactions, and Share balances. The TPA(s) shall maintain on
behalf of each of the Plans a single master account with the Transfer Agent
and such account shall be in the name of that Plan, the TPA(s), or the
nominee of either thereof as the record owner of Shares owned by such Plan.
5. The TPA(s) shall maintain records of all proceeds of redemptions of Shares
and all other distributions not reinvested in Shares.
6. The TPA(s) shall prepare, and transmit to each of the Plans, periodic
account statements showing the total number of Shares owned by that Plan as
of the statement closing date, purchases and redemptions of Shares by the
Plan during the period covered by the statement, and the dividends and
other distributions paid to the Plan on Shares during the statement period
(whether paid in cash or reinvested in Shares).
7. The TPA(s) shall, at the request and expense of each Fund, transmit to the
Plans prospectuses, proxy materials, reports, and other information
provided by each Fund for delivery to its shareholders.
8. The TPA(s) shall, at the request of each Fund, prepare and transmit to each
Fund or any agent designated by it such periodic reports covering Shares of
each Plan as each Fund shall reasonably conclude are necessary to enable
the Fund to comply with state Blue Sky requirements.
9. The TPA(s) shall transmit to the Plans confirmation of purchase orders and
redemption requests placed by the Plans; and
10. The TPA(s) shall, with respect to Shares, maintain account balance
information for the Plan(s) and daily and monthly purchase summaries
expressed in Shares and dollar amounts.
11. Plan sponsors may request, or the law may require, that prospectuses, proxy
materials, periodic reports and other materials relating to each Fund be
furnished to Participants in which event the Transfer Agent or each Fund
shall mail or cause to be mailed such materials to Participants. With
respect to any such mailing, the TPA(s) shall, at the request of the
Transfer Agent or each Fund, provide at the TPA(s)'s expense complete and
accurate set of mailing labels with the name and address of each
Participant having an interest through the Plans in Shares.
CGM CAPITAL DEVELOPMENT FUND STATE STREET BANK AND TRUST
COMPANY
BY: /s/ Xxxxxx X. Xxxx BY: /s/ Xxxxxx X. Xxxxx
-------------------------- -------------------------
