SHAREHOLDER SERVICE AGREEMENT
This Shareholder Service Agreement (this "Agreement") dated as of
November 22, 1996 is made and entered into by and between First Trust
Corporation ("FTC"), a Colorado corporation with its principal office at 000
Xxxxxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxx 00000, Denver Investment Advisors LLC (the
"Company"), a Colorado Limited Liability Company, with its principal office at
0000 Xxxxxxxxxxx Xxxxxx, 00xx Xxxxx, Xxxxxx, Xxxxxxxx 00000, and Westcore Trust
("Trust"), a Massachusetts business trust, with its principal office at 000
Xxxxxxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxx, Xxxxxxxx 00000.
RECITALS AND REPRESENTATIONS
A. FTC is a duly licensed trust company providing trust, custodial
and other services to individual retirement accounts, qualified retirement
plans and taxable investment accounts (the "Plan(s)"). Some of the Plans
contain provisions that permit or require each participant to direct the
investment of that portion of a Plan's assets that is allocated to such
participant's account. Some of the Plans provide for the delegation of
investment authority to investment managers, co-trustees, or named
fiduciaries other than FTC. In no case does FTC have any investment
discretion or authority with respect to any of the Plans, nor does FTC make
any investment recommendations with respect to a Plan.
B. The Trust is registered as an open-end management investment
company under the Investment Company Act of 1940, as amended, and offers and
sells shares of each of the series identified on EXHIBIT A hereto. The Trust
may establish additional series and such series may be added to this Agreement
as provided below. The series currently identified on EXHIBIT A hereto and
those added to this Agreement in the future are referred to below individually
as a "Fund" and collectively as the "Funds."
C. The Company is the investment adviser to each of the Funds, and
is authorized to make payments to certain persons for shareholder servicing and
administration of shareholder accounts.
D. The Trust desires to make the Funds available to the Plans, and
FTC desires to provide shareholder accounting and recordkeeping functions
required for purchases and redemptions of, and dividends paid on account of, the
shares of the Funds to be held by FTC for the benefit of the Plans.
In consideration of the premises and representations contained above, the
parties agree as follows:
1. PROCEDURES FOR ACCOUNTS AND TRANSACTIONS. The Trust will cause
the Funds' transfer agent (the "Transfer Agent") to maintain one or more
accounts (the "FTC Account(s)") on its books for each Fund for the Plans. The
assets of one or more Plans may be held in any FTC Account. The FTC Accounts
will be titled in the nominee name of "FTC & Co., Attn: DATAlynx
#_____________," and FTC, as trustee or custodian of the Plans, will be the
shareholder of record for the FTC Accounts. FTC will purchase or redeem shares
of each Fund for the benefit of the Plans, as applicable, as follows:
(a) The Trust confirms that if FTC notifies the Transfer Agent
prior to 4:00 p.m. on any business day concerning the purchase of a Fund's
shares, the purchase will be effected on such business day, and that if FTC
notifies the Transfer Agent at or after 4:00 p.m. on any business day concerning
the purchase of a Fund's shares, the purchase will be effected on the next
business day. (All times referred to in this Agreement will be Eastern time.)
Purchases will be paid for in cash or by Federal Funds at prices equal to net
asset value. FTC will make reasonable efforts to ensure that payment is
received by the Transfer Agent prior to 4:00 o'clock p.m. on the next business
day following the effective date of the purchase. The Company shall instruct
the Transfer Agent not to cancel orders for up to three business days after the
effective date of purchases in cases where payment is not received by 4:00 p.m.
on the next business day after the effective date of the purchases. In all
cases, FTC will be responsible for any losses incurred by the Funds resulting
from a delay or failure to make payment for orders by 4:00 p.m. on the next
business day after the effective date of the purchase.
(b) The Trust confirms that if FTC notifies the Transfer Agent
prior to 4:00 p.m. on any business day concerning the redemption of a Fund's
shares, the redemption will be effected on such business day, and that if FTC
notifies the Transfer Agent at or after 4:00 p.m. on any business day concerning
the redemption of a Fund's shares, the redemption will be effected on the next
business day. The Trust confirms that the Transfer Agent will wire redemption
proceeds to FTC on the next business day following the effective date of the
redemption.
(c) The Trust confirms that FTC may make orders for the purchase
or redemption of shares of a Fund by telephonic advice.
(d) FTC will maintain separate accounting and recordkeeping for
each of the Plans, and will allocate on its records the number of Fund shares
purchased, accrued as dividends
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and redeemed, and any cash dividends or distributions paid on account of the
shares of each Fund, for each of the Plans. FTC will reconcile the amounts
posted to each Plan with the amounts recorded on the Transfer Agent's records
for each Fund for each respective FTC Account.
(e) The Trust will be responsible under this Agreement for the
servicing of the respective FTC Accounts and will have no responsibility for the
servicing of the Plans. FTC will provide recordkeeping services to the Plans.
The foregoing obligations of the parties are more particularly described on
EXHIBIT B, which is made a part of this Agreement.
2. FEES. For the accounting and recordkeeping services provided by
FTC under this Agreement, the Company will pay to FTC a quarterly service fee
equal on an annual basis to .25% (O.0625% per quarter) of the average daily net
asset value of the shares of such Fund which are owned beneficially by the Plans
during such period. Such fees will be sent to FTC no later than ten (10) days
following the end of the calendar quarter in which they accrue.
3. MANNER OF PAYMENT. Payments made pursuant to Section 2 of this
Agreement will be made by check, and will be accompanied by one report for each
FTC Account. Such report will show the calculation used to arrive at the amount
paid.
4. REPORTING OF TRANSACTIONS. The Trust will furnish to FTC, on a
transaction-by-transaction basis, a statement that will set forth for each FTC
Account the number of shares purchased or redeemed, the beginning and ending
share balances, and the net asset value per share. The Company will mail such
statement to FTC no later than the business day next following the transaction
being reported.
5. SHAREHOLDER COMMUNICATIONS. FTC will cause the mailing to the
Plans of all currently effective prospectuses of the Fund, proxy materials
(including notices, proxy statements and forms of proxies), reports and other
communications which must be furnished by law to shareholders, in accordance
with the procedures set forth on EXHIBIT B. Upon FTC's request, the Trust will
provide FTC with sufficient copies of any requested communications to ensure FTC
is able to fulfill its obligations as described in this Section 5.
6. COORDINATION OF OPERATIONS. The Trust will cause appropriate
personnel to be made available, as may be reasonably requested by FTC, to
consult with FTC in coordinating operations pursuant to this Agreement.
7. STATUS OF FTC, COMPANY AND TRUST. The parties acknowledge and
agree that the payment of service fees as
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provided in Section 2 of this Agreement relates to recordkeeping, accounting and
related services only and do not constitute payment for and are not related in
any manner to investment advisory services or the distribution of shares of any
Fund within the meaning of the Securities Act of 1933 or the Investment Company
Act of 1940. This Agreement does not grant FTC any right to purchase shares
from the Funds, nor does it constitute FTC an agent of the Funds, the Trust or
the Company, for purposes of selling shares of the Funds to any dealer or to the
public, or for any other purposes. To the extent FTC enters any purchase or
redemption order for an FTC Account, such purchase or redemption order will be
made by FTC (a) as agent of each of the Plans whose shares are the subject of
such purchase or redemption order, and (b) pursuant to instructions from the
account owner, participant, named fiduciary entity or any other person with
investment discretion and authority for the assets that are the subject of the
transaction. FTC agrees that it will comply with all applicable law and
regulations, including relevant provisions of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), in the course of performing its
duties hereunder. Without limiting the generality of the foregoing, FTC agrees
that it will disclose the receipt of fees payable hereunder to an independent
fiduciary or the beneficial owners of each Plan. FTC represents that it is not
a "fiduciary" of any Plan, as such term is defined in ERISA. The Company
represents that it is (i) a limited liability corporation duly organized and
existing and in good standing under the laws of the State of Colorado, (ii) an
investment advisor registered under the Investment Advisers Act of 1940, as
amended, and (iii) authorized to enter into and perform this Agreement, and the
performance of its obligations hereunder does not and will not violate or
conflict with any governing documents or agreements of Trust with respect to the
Funds or any applicable law. The Trust represents that it is (i) a duly
organized and existing Massachusetts Business Trust in good standing, and (ii)
authorized to enter into and perform this Agreement on behalf of the Funds, and
the performance of its obligations hereunder does not and will not violate or
conflict with any governing documents or agreements of Trust with respect to the
Funds or any applicable law.
8. AMENDMENTS. Any amendment to this Agreement will be valid only
if in writing and signed by all the parties. The parties agree that Funds may
be deleted from and additional Funds may be added to this Agreement (and thus
would become "Funds" for purposes of this Agreement), whenever the parties sign
an addendum that identifies such Funds, at which time this Agreement will be
deemed to have been so amended without further action by the parties.
9. TERMINATION WITHOUT CAUSE. Any party to this Agreement will have
the right to terminate this Agreement for any
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reason upon 60 days' written notice to the other party, without any liability
arising by reason of such termination.
10. TERMINATION UPON BREACH. Upon any breach of this Agreement by
any party, either of the other two parties may terminate this Agreement upon 10
days' written notice to the other parties.
11. RESOLUTION OF DISPUTES. All disputes arising out of or in
connection with this Agreement (except disputes concerning the Company's or
the Trust's use of FTC proprietary information described in Section 14) will
be settled by arbitration, to be conducted pursuant to the rules of the
American Arbitration Association. All arbitration proceedings will take
place only in Denver, Colorado. To the extent not preempted by federal law,
Colorado statutory law (including without limitation the statutes governing
the award of damages and arbitration) and Colorado common law will control
during arbitration. Each party waives any right it may have to institute or
conduct litigation or arbitration in any other forum or location, or before
any other body, except that FTC expressly reserves the rights granted to it
in Section 14. Arbitration is final and binding on the parties. An award
rendered by the arbitrator(s) may be entered in any court having jurisdiction
over the pertinent party. The prevailing party in any arbitration, or in any
judicial proceeding relating to the rights of FTC under Section 14, will be
entitled to reasonable attorneys' fees and costs.
12. INDEMNIFICATION OBLIGATIONS. FTC agrees to indemnify and hold
harmless each of the Company and the Trust from any loss, expense, cost,
liability or damage (including reasonable attorneys fees) which may be suffered
by it as a result of any breach of this Agreement by FTC or arising from (i) any
dissemination of information regarding the Trust or the Company that is
materially incorrect and that was not provided to FTC, or approved, by the Trust
or the Company, or (ii) any negligent act or omission of FTC in the performance
of its duties under this Agreement. The Company agrees to indemnify and hold
harmless FTC from any loss, expense, cost, liability or damage (including
reasonable attorneys fees) which may be suffered by it as a result of any breach
of this Agreement by the Company or arising from any negligent act or omission
of the Company in the performance of its duties under this Agreement. The Trust
agrees to indemnify and hold harmless FTC from any loss, expense, cost,
liability or damage (including reasonable attorneys fees) which may be suffered
by it as a result of any breach of this Agreement by the Trust or arising from
any negligent act or omission of the Trust in the performance of its duties
under this Agreement.
13. INDEMNIFICATION PROCEDURES. If a person receives notice of the
commencement of any action, suit, or proceeding (an
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"Action") or notice that any Action may be commenced, and if the person
receiving the notice (the "indemnified person") desires to be indemnified by a
party under this Agreement (the "indemnifying party"), the indemnified person
will give notice to the indemnifying party of the commencement of the Action or
of the possibility that an Action will be commenced. Any omission to notify an
indemnifying parry will not relieve the indemnifying party from any liability
which it may have under this Agreement, except to the extent the failure to
notify the indemnifying party prejudices the rights of the indemnifying party.
The indemnified person will be entitled, at the sole expense and liability of
the indemnifying party, to exercise full control of the defense, compromise or
settlement of any such Action unless the indemnifying party, within a reasonable
time after the giving of such notice by the indemnified person, (1) admits in
writing to the indemnified person the indemnifying party's duty to indemnify the
indemnified person for such Action under the terms of this Section, (2) notifies
the indemnified person in writing of the indemnifying party's intention to
assume such defense, (3) provides evidence reasonably satisfactory to the
indemnified person as to the indemnifying party's ability to pay the amount, if
any, for which the indemnified person may be liable as a result of such Action,
and (4) retains legal counsel reasonably satisfactory to the indemnified person
to conduct the defense of such Action. The indemnified person will cooperate
with the person assuming the defense, compromise or settlement of any Action in
accordance with this Agreement in any manner that such person reasonably may
request. If the indemnifying party so assumes the defense of any such Action,
the indemnified person will have the right to employ a separate counsel and to
participate in (but not control) the defense, compromise or settlement of the
Action, but the fees and expenses of such counsel will be at the expense of the
indemnified person unless (a) the indemnifying party has agreed to pay such fees
and expenses, (b) any relief other than the payment of money damages is sought
against the indemnified person, or (c) the indemnified person has been advised
by its counsel that there may be one or more defenses available to it which are
different from or additional to those available to the indemnifying party and
that a conflict of interest therefore exists, and in any such case that portion
of the fees and expenses of such separate counsel that are reasonably related to
matters covered by the indemnity provided in this Section will be paid by the
indemnifying party. No indemnified person will settle or compromise any such
Action for which it is entitled to indemnification under this Agreement without
the prior written consent of the indemnifying party, unless the indemnifying
party has failed, after reasonable notice, to undertake control of such Action
in the manner provided in this Section. No indemnifying party will settle or
compromise any such Action in which any relief other than the payment of money
damages is sought against any indemnified person
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without the consent of the indemnified person, such consent not to be
unreasonably withheld.
14. CONFIDENTIALITY OF INFORMATION. Each of the Company and the
Trust recognizes that the information provided to it or to be provided to it
under this Agreement relating to the Plans (including the names and addresses of
the participants, the account numbers of the Plans, and any similar information)
is the proprietary information of FTC and agrees to keep such information
confidential and to prevent the use of such information by others, except to the
extent it is required by law to disclose such information. Each of the Company
and the Trust agrees that, prior to disclosing any such information to any
person in accordance with a requirement of law, it will redact such information
to the greatest extent permissible under law and will provide FTC with a
reasonable opportunity to appear in any judicial, administrative or arbitration
proceeding or investigation to contest the disclosure of such information. Each
of the Company and the Trust also agrees not to use such information for its
benefit or the benefit of any of its affiliates, directly or indirectly. The
obligations of the Company and the Trust under this Section 14 will apply during
the term of this Agreement and for a period of five (5) years after the date
this Agreement is terminated, for whatever reason. Because a violation of the
duties of the Company and the Trust under this Section 14 could cause
irreparable injury to FTC which may not be measurable in money damages, each of
the Company and the Trust agrees that FTC will be entitled to obtain injunctive
relief against it for any violation of such duties, without prejudicing FTC's
right to obtain money damages.
15. INTEREST ON AMOUNTS DUE. Any amount due under this Agreement
from one party to another party will bear interest, from the date such amount is
due until such payment is made, at a rate equal to the "prime rate," as
published from time to time by THE WALL STREET JOURNAL.
16. PRIOR AGREEMENTS. This Agreement supersedes all proposals, prior
communications, advertising, representations, warranties and promises, whether
oral or written, relating to the subject matter of this Agreement.
17. ASSIGNMENT. This Agreement may be assigned by a party only with
the written consent of the other parties.
18. SEPARABILITY. If any provision of this Agreement is deemed to be
in violation of law or is unenforceable, the remainder of this Agreement with
such provision omitted will remain in full force and effect.
19. COMPLIANCE WITH LAWS. Each party agrees to abide by all
applicable federal and state laws and regulations in
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connection with the performance of its obligations under this Agreement.
20. SURVIVAL OF OBLIGATIONS. The representations and warranties of
the parties and all obligations and responsibilities of the parties under this
Agreement, including all payment obligations, as to periods through the date
this Agreement is terminated, will survive the termination of this Agreement.
Without limiting the foregoing, the provisions of Sections 11, 12, 13, 14, and
15 will continue to apply after termination of this Agreement.
21. NOTICES AND REPORTS. Except as otherwise provided in this
Agreement, all notices and reports given under this Agreement will be given only
by delivery in person, by deposit in the United States mails, using certified
mail, by commercial overnight delivery service, or by facsimile transmission
(with machine confirmation) or electronic mail. All notices and reports will be
in writing and addressed to the party at the address set forth in the first
paragraph of this Agreement (unless a party specifies by a written notice to the
other party that a different address should be used). Notices and reports will
be deemed delivered when delivered in person or, if mailed by certified mail, on
the third business day after the date of deposit into the United States mails,
and upon receipt, if by commercial overnight delivery service. Facsimile
transmission and electronic mail will be deemed received the same day as sent.
FTC will furnish the Trust or its designees with such information as it or they
may reasonably request (including, without limitation, periodic certifications
confirming the provision to FTC customers of the services described in the
Service Agreement, as amended, and blue sky reports at least monthly), and will
otherwise cooperate with the Trust and its designees (including, without
limitation, any auditors designated by the Funds), in connection With the
preparation of reports to the Trust's Board of Trustees concerning the Service
Agreement, as amended, and the monies paid or payable by the Trust pursuant
hereto, as well as any other reports or filings that may be required by law.
22. ADDITIONAL PROVISIONS.
(a) Neither FTC nor any of its officers, employees or agents are
authorized to make any representations concerning the Trust except those
contained in the Trust's then current prospectuses and statements of additional
information, copies of which will be supplied by the Trust to FTC, or in such
supplemental literature or advertising as may be authorized by the Trust or its
distributor in writing.
(b) FTC represents, warrants and agrees that: (i) the services
provided by it under this Agreement, as amended, will in no event be primarily
intended to result in the sale of
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shares of the Trust; (ii) each of its DATAlynx service customers is an
investment advisor registered under the Investment Advisors Act of 1940, or a
bank or other entity exempt from such registration, and (iii) it will comply, at
all times, with all applicable federal and state securities laws.
(c) The names "Westcore Trust" and "Trustees of Westcore Trust"
refer respectively to the Trust created and the Trustees, as Trustees but not
individually or personally, acting from time to time under an Amended and
Restated Declaration of Trust dated November 19, 1987, which is hereby referred
to and a copy of which is on file at the office of the State Secretary of the
Commonwealth of Massachusetts and at the principal office of the Trust. The
obligations of "Westcore Trust" entered into in the name or on behalf thereof by
any of the Trustees, representatives or agents are made not individually, but in
such capacities, and are not binding upon any of the Trustees, shareholders, or
representatives of the Trust personally, but bind only the Trust Property, and
all persons dealing with any class of shares of the Trust must look solely to
the Trust Property belonging to such class for the enforcement of any claims
against the Trust.
23. EFFECTIVE DATE. This Agreement will be effective on the date it
is accepted and executed by FTC.
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24. GOVERNING LAW. This Agreement will be construed by and governed
in accordance with the laws of the State of Colorado.
DENVER INVESTMENT ADVISORS LLC (Company)
By: /s/ Xxxxxxx X. Xxxxxxx
--------------------------------
Its: President
--------------------------------
Date: November 22, 1996
-------------------------------
WESTCORE TRUST (Trust)
By: /s/ Xxxx X. Xxxxxxxxx
---------------------------------
Its: Vice President
--------------------------------
Date: November 22, 1996
-------------------------------
Accepted by:
FIRST TRUST CORPORATION (FTC)
By: /s/ Xxxxxx X. Xxx
---------------------------------
Its: Senior Vice President
--------------------------------
Date: November 22, 1996
-------------------------------
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EXHIBIT A
TO SHAREHOLDER SERVICE AGREEMENT
PORTFOLIOS OF WESTCORE TRUST
Fund Name Cusip Ticker Symbol Trading Cutoff Time
--------- ----- ------------- -------------------
1. Blue Chip 957904881 WTMVX 4:00 p.m. EST
2. Colorado Tax Exempt 957904782 WCTIZ 4:00 p.m. EST
3. Growth & Income 957904667 WTEIX 4:00 p.m. EST
4. Intermediate-Term Bond 957904675 WTIBX 4:00 p.m. EST
5. Long-Term Bond 957904709 WTLTX 4:00 p.m. EST
6. Midco Growth 957904717 WTMGX 4:00 p.m. EST
7. Small-Cap Opportunity 957904618 WSCIZ 4:00 p.m. EST
* These Funds have adopted a Rule 12b-1 Plan.
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EXHIBIT B
TO SHAREHOLDER SERVICE AGREEMENT
REGISTRAR, TRANSFER AGENT AND
RECORDKEEPING SERVICES
A. Registrar and Transfer Agency Functions Provided by the Company and the
Trust
1. Process purchases, redemptions and exchanges of Fund shares in
accordance with instructions received from FTC and the then-current
prospectus of the Fund.
2. Provide to FTC one Fund statement for each FTC Account as described in
Section 4 of the Agreement.
3. Provide daily pricing, dividend reinvestment and capital gain
information for each FTC Account.
4. Assist FTC in resolving any account discrepancies between FTC and the
Fund.
B. Recordkeeping and Shareholder Servicing Functions Provided by FTC
1. Provide sub-accounting services in accordance with Section 1(d) of the
Agreement.
2. Timely cause the mailing of Fund prospectuses, proxies and related
information to those Plans and individual participants identified by
FTC and in accordance with Section 5 of the Agreement.
3. Assist in processing purchase and redemption transactions; changing
dividend options, account designations and addresses; and
establishment and maintenance of Plan accounts and records.
4. Provide additional services to the Plans as required in the separate
XXX account, custodial account or service agreement between FTC and
each taxable investment account owner or plan employer, as they may be
amended from time to time.
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