LOAD FUND OPERATING AGREEMENT
This Load Fund Operating Agreement is made as of June 1, 2007 by and
between AllianceBernstein Investments, Inc. ("Distributor"); each a registered
investment company executing it ("Fund Company"), on its own behalf and on
behalf of each of its series or classes of shares listed on Schedule I hereto,
as amended from time to time ("Fund(s)"); and Xxxxxxx Xxxxxx & Co., Inc.
("Schwab"), a California corporation ("Agreement"). In the event there are no
Funds, then the term "Fund" shall mean "Fund Company." Fund Company and
Distributor are referred to collectively herein as "Fund Parties."
WHEREAS, Fund Parties wish to have shares of the Fund(s) available to
investors for purchase and redemption through Xxxxxx'x Mutual Fund
Marketplace(R) ("MFMP");
WHEREAS, certain policies, procedures, and information are necessary to
enable the Fund(s) to participate in the MFMP; and
WHEREAS, Schwab is willing to permit the Fund(s) to participate in its MFMP
pursuant to the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing and the mutual promises
set forth below, the parties agree as follows:
1. Operating Procedures.
a. For each Fund, Schwab shall (i) open an account for the benefit of
one or more MFMP investors who invest in shares of the Fund (each such account
an "Omnibus Account"); and/or (ii) open an account with the Fund for the benefit
of each MFMP investor that invests in shares of the Fund (each such account a
"Sub-Account"). Sub-Accounts shall be maintained on Xxxxxx'x system in trading
symbols separate from trading symbols established for Omnibus Accounts.
Sub-Accounts and Omnibus Accounts shall be referred to collectively herein as
"Account(s)."
b. Through the Accounts, Schwab shall purchase and redeem shares,
settle transactions, reconcile transactions, obtain pricing, reinvest
distributions and maintain records solely in accordance with the operating
procedures set forth in Exhibit A hereto ("Operating Procedures"). The parties
agree to transfer accounts, communicate with Fund shareholders and perform other
obligations in accordance with the Operating Procedures, as applicable to each
Fund.
2. Qualification Requirements.
x. Xxxxxx will only place purchase orders for shares of a Fund on
behalf of an MFMP investor whose account address is in a state or other
jurisdiction in which Fund Company has advised Schwab that, under applicable
law, such Fund's shares are either qualified for sale or exempt from such
qualification. Fund Company shall advise Schwab immediately (i) if any such
qualification of shares is terminated, (ii) if any such exemption is no longer
applicable, or (iii) if it wishes Schwab not to place purchase orders for a Fund
on behalf of MFMP investors whose account addresses are in a particular state or
other jurisdiction.
b. With respect to shares of Funds held in Omnibus Accounts, Schwab
will, upon request, (i) furnish Fund Company with monthly written statements of
the number of shares of each Fund purchased on behalf of MFMP investors whose
account addresses are in one or more states or other jurisdictions indicated by
Fund Company or (ii) on a daily basis, transmit to an electronic database
provider with whom Schwab has established effective systems interfaces
information regarding the number of shares of each Fund purchased on behalf of
MFMP investors whose account addresses are in each state for retrieval by Fund
Company. Fund Company shall be responsible for all reasonable fees and other
reasonable charges of such database provider in connection with Xxxxxx'x
transmission of such information to and Fund Company's retrieval of such
information from such database provider.
3. Compliance Responsibilities.
a. Fund Parties are responsible for (i) the compliance of each
prospectus, registration statement, annual or other periodic report, proxy
statement and item of advertising or marketing material of or relating to each
Fund with all applicable laws, rules and regulations (except for advertising or
marketing material prepared by Schwab that was not published or provided to
Schwab by or on behalf of Fund Company, Distributor, or any Affiliate (defined
below) of Fund Company or accurately derived from information published or
provided by or on behalf of Fund Company or any Affiliate), (ii) the
distribution and tabulation of proxies in accordance with all applicable laws,
rules and regulations (except for such proxy related services provided by
Xxxxxx'x mailing agent), (iii) the registration or qualification of the shares
of each Fund under all applicable laws, rules, and regulations, and (iv) the
compliance by Fund Company, Distributor, and each Affiliate of Distributor, with
all applicable laws, rules, and regulations (including the Investment Company
Act of 1940, as amended (the "1940 Act"), and the Investment Advisers Act of
1940, as amended), and the rules and regulations of each self-regulatory
organization with jurisdiction over Fund Company, Distributor, or any Affiliate
of Fund Company, except to the extent that the failure to so comply by Fund
Company, Distributor or any Affiliate of Fund Company is caused by Xxxxxx'x
breach of this Agreement or its willful misconduct or negligence in the
performance of or failure to perform, its obligations under this Agreement. Fund
Company and Distributor's responsibilities under Sections 3.a.(i) through
3.a.(iv) include, but are not limited to, compliance of information published,
distributed, or made available, and activities conducted through, the Internet
and any other electronic medium. For purposes of this Agreement, an "Affiliate"
of a person means (i) any person directly or indirectly controlling, controlled
by, or under common control with, such person, (ii) any officer, director,
partner, corporation, or employee of such person, and (iii) if such person is an
investment company, any investment advisor thereof or any member of the advisory
board thereof. Notwithstanding anything herein to the contrary, Fund Company
shall not be responsible for the compliance with all applicable laws, rules and
regulations by Fund Distributor and Affiliates of Distributor.
b. In the event that an Omnibus Account holds five percent (5%) or
more of the outstanding Fund shares, Fund Company will be responsible for
requesting Schwab to confirm its status as shareholder of record and to confirm
whether any MFMP investor beneficially owns five percent (5%) or more of the
outstanding Fund shares through Schwab. For this purpose, Fund Company shall
indicate in its inquiry the number of Fund shares that equal five percent (5%)
of outstanding Fund shares. Schwab shall promptly reply to any such inquiries.
x. Xxxxxx is responsible for Xxxxxx'x compliance with all applicable
laws, rules and regulations governing Xxxxxx'x performance under this Agreement,
except to the extent that Xxxxxx'x failure to comply with any law, rule, or
regulation is caused by Fund Company or Distributor's breach of this Agreement,
or its willful misconduct or negligence in the performance of or failure to
perform its obligations under this Agreement.
x. Xxxxxx acknowledges and agrees that, as between Fund Parties and
Schwab, it is Xxxxxx'x compliance responsibility to (i) make any required
suitability determination of any Fund as an investment for an MFMP investor;
(ii) accurately and verifiably determine any MFMP investor's breakpoint
eligibility and other Fund provided, publicly disclosed methods of obtaining a
reduced or eliminated sales charge (collectively "Discount(s)") on a Fund's
shares and to notify the Fund contemporaneously with each order it places in an
Account of any Discounts on the order; and (iii) assess any applicable sales
charge (including both front end sales loads and contingent deferred sales
charges) and any applicable short-term redemption fee payable by an MFMP
investor on each transaction.
e. Fund Parties acknowledge and agree that (i) as of the effective
date of this Agreement as to any Fund, as set forth on Schedule I hereto (the
"Effective Date"), no provision in the prospectus or statement of additional
information of such Fund conflicts with Xxxxxx'x obligations under this
Agreement or imposes any obligation on Schwab not set forth in this Agreement,
and (ii) after the Effective Date as to any Fund, Fund Parties shall have the
obligation to notify Schwab and seek amendment of this Agreement in the event
that any prospective change in the prospectus or statement of additional
information of such Fund may cause such conflict or impose such new obligation
upon Schwab. Fund Parties agree further that if the parties cannot reach
agreement on amendment, then coincident with such change, Schwab may take either
one of the following actions, in its sole discretion: (A) suspend purchases of
shares of such Fund until such time as the parties amend this Agreement, or (B)
terminate this Agreement as to such Fund.
4. Payments.
a. In consideration of services provided by Schwab in connection with
networking the Sub-Accounts, Distributor, as agent for a Fund and on its behalf,
shall cause the Fund's transfer agent to pay a quarterly fee calculated on the
basis of the annual fee per Sub-Account set forth for the Fund on Schedule I
("Networking Fee"). At the end of each calendar quarter, Schwab will calculate
and invoice the Networking Fee for any such Fund for such quarter by multiplying
the number of Sub-Accounts for a Fund on the last day of such quarter on which
the New York Stock Exchange is open for trading ("Business Day") by one quarter
of the Networking Fee for such Fund. The Networking Fee is due each quarter upon
receipt of the invoice from Schwab setting forth such fee. The Distributor (or
the Fund's transfer agent) may pay the Networking Fee based upon its own
calculation, however, if there is a material discrepancy between the payment
calculated by the Distributor and Xxxxxx'x invoice, the parties will confer with
a goal to resolving such discrepancy. Payment shall be made through NSCC's
Commission Settlement Service or through wire transfer. To the extent payments
are made by wire transfer, such wire transfer shall be separate from wire
transfers of redemption proceeds or distributions under this Agreement.
Notwithstanding any provision of the Agreement to the contrary, no payment shall
be due for any calendar quarter with respect to a Sub-Account if the value of
Fund shares in such Sub-Account is less than $1,000 for the entire quarter.
b. In consideration of services provided by Schwab in connection with
maintaining the Omnibus Account(s), Distributor, as agent for a Fund and on its
behalf, shall cause the Fund's transfer agent to pay a quarterly fee calculated
on the basis of the annual per position maintenance fee set forth for the Fund
on Schedule I ("PPMF"). At the end of each calendar quarter, Schwab will
calculate the PPMF for any such Fund for such quarter by multiplying the number
of individual shareholder positions in the Omnibus Account(s) for such Fund on
the last Business Day of such calendar quarter by one quarter of the PPMF for
such Fund, and shall xxxx it in arrears. The PPMF is due each quarter upon
receipt of the invoice from Schwab setting forth such fee. Payment shall be made
through NSCC's Commission Settlement Service or through wire transfer. To the
extent payments are made by wire transfer, such wire transfer shall be separate
from wire transfers of redemption proceeds or distributions under this
Agreement.
c. Payments to Schwab for networking of Sub-Accounts under 4.a. and
for maintaining Omnibus Accounts under 4.b. are in addition to the usual and
customary broker's commission or concession and/or fees pursuant to a plan of
distribution and/or shareholder servicing adopted under the 1940 Act ("12b-1
Plan") payable to Schwab for the services it provides in connection with the
purchase and holding of a Fund's shares by MFMP investors. Fund Partyshall cause
such concession, commission, and 12b-1 Plan fee information to be set up
accurately, and to be kept current, in the appropriate fields of NSCC's Mutual
Fund Profile Service ("MFPS"), and shall pay them to Schwab as follows:
(i) On each purchase of shares, any applicable broker's
commission or concession due to Schwab shall be paid to Schwab in net settlement
of the order. Schwab acknowledges that no broker's concession or commission will
be paid on the reinvestment of dividends or capital gains.
(ii) Any 12b-1 Plan fees due on a Fund's shares held in
Sub-Accounts shall be calculated by the Fund Partyand paid to Schwab through
NSCC's Commission Settlement Service or, upon notification to and consent of
Schwab, through wire transfer. If by wire transfer, such wire transfer shall be
separate from wire transfers of redemption proceeds or distributions under this
Agreement.
(iii) Any 12b-1 Plan fees due on a Fund's shares held in Omnibus
Accounts, shall be calculated by Schwab and invoiced to Fund Parties according
to the rules and on the schedule the Fund Parties have set up on MFPS for 12b-1
Plan payments for such Fund. Payment is due upon receipt of the invoice setting
forth such fee. Payment may be made through NSCC's Commission Settlement Service
or, upon notification to and consent of Schwab, through wire transfer. If by
wire transfer, such wire transfer shall be separate from wire transfers of
redemption proceeds or distributions under this Agreement. With respect to
shares that have transferred into an Omnibus Account after initial purchase
directly from the Fund or through another financial intermediary, Schwab will
rely on the share lot history(ies), if applicable, as received from the Fund in
transferring such shares, as further set forth in Section 10.i. of the Operating
Procedures.
d. Liquidation of Small Accounts. Upon Fund Parties' request, which
may be made no more than once annually, or at such other times as the parties
may mutually agree, Schwab will identify Fund positions that are maintained and
processed through Xxxxxx'x Omnibus Accounts with the Funds that equal less than
the asset balance minimums, if any, set forth in the Fund's prospectus. Schwab
agrees to reasonably cooperate with the Funds' efforts to liquidate those
positions, provided all such liquidations are effected by the Funds in a manner
permitted by and consistent with each Fund's policies and procedures as
described in its prospectus. For purposes of effecting such liquidations, Fund
Parties agree to apply its liquidation policies to shareholders that maintain
Fund positions through an Omnibus Account to the same extent and in the same
manner as it applies those policies to other shareholders, including those that
hold Fund shares directly with the Fund and those that hold indirectly through
another financial intermediary
e. The parties understand and agree that the receipt of compensation
by Schwab under this Agreement is for the services Schwab provides as broker and
agent for MFMP investors in connection with the purchase of Fund shares, and for
ongoing shareholder and administrative services provided on such shares as set
forth herein, and is not conditioned upon the performance of promotional,
marketing, or similar distribution-related activities on behalf of the Fund.
5. Representations and Warranties.
a. Fund Parties represent and warrant that each Fund is in compliance
with the conditions and qualifications set forth in Rule 2830(d) and
2830(l)(1)(4) of the Conduct Rules of the National Association of Securities
Dealers Regulation, Inc., ("NASDR") as amended from time to time, which enable a
member of the National Association of Securities Dealers, Inc. ("NASD") to offer
or sell shares of the Fund.
b. Fund Parties represent and warrant that either Distributor, Funds,
Fund Company or an agent of the Fund Company are Fund Members of the National
Securities Clearing Corporation ("NSCC") and have access to the NSCC's Fund/Serv
system ("Fund/Serv") and the NSCC's Networking system ("Networking").
x. Xxxxxx represents and warrants that it is a Member of the NSCC and
has access to Fund/Serv and Networking.
x. Xxxxxx represents and warrants that the person signing this
Agreement on its behalf is an officer authorized to execute this Agreement on
behalf of Schwab.
e. Anti-Money Laundering Certification. Schwab represents and warrants
that it has established an Anti-Money Laundering Program reasonably designed to
comply with all applicable anti-money laundering laws and regulations, including
applicable provisions of the Bank Secrecy Act and the USA PATRIOT Act of 2001,
as well as with the regulations administered by the U.S. Department of the
Treasury's Office of Foreign Assets Control. As part of its Anti-Money
Laundering Program, Schwab will take reasonable steps to identify the customers
for whom it acts in its dealings with the Funds and will monitor customer
transactions in order to detect and, where appropriate, report suspicious
activities.
f. Fund Company represents and warrants that the person signing this
Agreement on its behalf is an officer of Fund Company authorized to execute this
Agreement on behalf of Fund Company, and that any agent of Fund Company
completing and delivering Exhibit B or C of this Agreement is authorized by Fund
Company to complete and deliver such Exhibit.
g. If the foregoing representations and warranties made by Fund
Parties and Schwab are no longer accurate then Fund Parties or Schwab, as
appropriate, will promptly notify the other party thereof.
6. Use of Parties' Names; No Publication of Terms.
a. Neither Schwab nor Fund Company shall make public the terms and
conditions of this Agreement, nor any discussions relating thereto, without the
consent of the other party, which consent shall not be unreasonably withheld;
provided however, if public disclosure of such information is required by law,
such consent shall be deemed granted and the party required to disclose such
information shall, if practicable, notify the other party prior to such
disclosure.
b. Without Xxxxxx'x prior written consent, Fund Company shall acquire
no right to use, and shall not use, cause or permit use of the names,
characters, artwork, designs trade names, copyrighted materials, trademarks, or
service marks of Schwab, its related or subsidiary companies, parent, employees,
directors, shareholders, assigns, successors, or licensees: (i) in any
advertising, promotional materials or activities, publicity, press release,
client list, or public or private presentation or promotion; (ii) to express or
to imply any endorsement of Fund Company or any of its Affiliates or their
respective offerings or services; or (iii) in any manner other than expressly in
accordance with this Agreement.
c. Fund Company authorizes Schwab to use the names or other
identifying marks of Fund Company and Fund in connection with the operation of
the MFMP. Fund Company may withdraw this authorization as to any particular use
of any such name or identifying marks at any time (i) upon Fund Company's
reasonable determination that such use would have a material adverse effect on
the reputation or marketing efforts of Fund Company or such Fund, or (ii) if any
of the Funds cease to be available through the MFMP; provided, however, that
Schwab may, in its sole discretion, continue to use materials prepared or
printed prior to the withdrawal of such authorization or in the process of being
prepared or printed at the time of such withdrawal.
7. Confidentiality.
a. Definition of Confidential Information. The term confidential
information shall mean all information that either party discloses (the
"Disclosing Party"), whether in writing, electronically, or orally, to the other
party (the "Receiving Party"), whether in tangible or intangible form, including
but not limited to: (i) any information concerning a party, its agent, or its
licensor's technology, such as systems, source code, databases, hardware,
software, programs, applications, engine protocols, routines, models, displays
and manuals, including, without limitation, the selection, coordination, and
arrangement of the contents thereof and (ii) any unpublished information
concerning research activities and plans, customers, marketing or sales plans,
sales forecasts or results of marketing efforts, pricing or pricing strategies,
costs, operational techniques, strategic plans, Customer Information (as defined
below), and unpublished financial information, including information concerning
revenues, profits, and profit margins will be deemed confidential and
proprietary to the Disclosing Party, regardless of whether such information was
disclosed intentionally or unintentionally or marked as "confidential" or
"proprietary" ("Confidential Information").
b. Treatment of Confidential Information. Each party agrees that: (a)
the Receiving Party will hold any and all Confidential Information it obtains in
strictest confidence and will use and permit use of Confidential Information
solely for the purposes of this Agreement; (b) without limiting the foregoing,
the Receiving Party shall use at least the same degree of care, but no less than
reasonable care, to avoid disclosure or use of this Confidential Information as
the Receiving Party employs with respect to its own Confidential Information;
(c) the Receiving Party may disclose or provide access only to its responsible
employees or agents who have a need to know and are under confidentiality
agreements at least as restrictive as this Agreement with respect to the
Confidential Information, and may make copies of Confidential Information only
to the extent reasonably necessary to carry out the obligations hereunder; and
(d) the Receiving Party will notify the Disclosing Party immediately of any
unauthorized disclosure or use, and will cooperate with the Disclosing Party to
protect all proprietary rights in and ownership of its Confidential Information.
c. Exceptions. This Section 7 shall not prohibit or limit the
Receiving Party's use, disclosure, reproduction, or dissemination of the
Disclosing Party's Confidential Information which, (a) is or becomes public
domain information or material through no fault or breach on the part of the
Receiving Party, (b) was already rightfully known (without restriction on
disclosure) to the Receiving Party prior to being disclosed by or obtained from
the Disclosing Party, as evidenced by written records kept in the ordinary
course of business of, or by proof of actual use by, the Receiving Party, (c)
has been or is hereafter rightfully received by the Receiving Party from a third
person (other than the Disclosing Party) without restriction on disclosure and
without breach of a duty of confidentiality to the Disclosing Party; (d) has
been independently developed by the Receiving Party without access to
Confidential Information of the Disclosing Party; or (e) is required to be
disclosed, but only to the extent required, by court order, or pursuant to
applicable law, regulation or self-regulatory organization rules, provided that
the Receiving Party notifies the Disclosing Party so that the Disclosing Party
may have a reasonable opportunity to obtain a protective order or other form of
protection against disclosure. Notwithstanding any such compelled disclosure by
the Receiving Party, such compelled disclosure will not otherwise affect the
Receiving Party's obligations hereunder with respect to Confidential
Information, including Customer Information, so disclosed. It shall be presumed
that any Confidential Information in the Receiving Party's possession is not
within any of the exceptions above, and the burden is upon the Receiving Party
to prove otherwise by records and documentation.
d. Customer Information. As between Schwab and Fund Parties, Customer
Information (as defined below) will remain the sole and exclusive property of
Schwab. "Customer Information" shall mean all disclosed data information,
however collected or received, including without limitation, through "cookies,"
Web bugs, or non-electronic means pertaining to or identifiable to Xxxxxx'x
customer(s) or prospective customers, to investment advisors, third party
administrators, or introducing brokers placing transactions through Schwab, or
to the customers of such intermediaries, including, without limitation, name,
address, e-mail address, TIN or social security number, passwords, account
numbers, personal financial information, personal preferences, demographic data,
marketing data, data about securities transactions, credit data, or any other
identification data.
e. Treatment of Customer Information. Each party represents and
warrants that at all times during and after the terms of this Agreement, it
shall use, handle, collect, maintain and safeguard Customer Information in
accordance with: (i) Xxxxxx'x published privacy policy as it is in effect from
time to time; (ii) the confidentiality and non-disclosure requirements of this
Agreement; (iii) the Xxxxx-Xxxxx-Xxxxxx Act of 1999 (Public law 106-102, 113
stat. 1138) and its implementing regulations (e.g. Securities and Exchange
Commission Regulation S-P and Federal Reserve Board Regulation P) as applicable
and as they may be amended from time-to-time; and (iv) such other applicable
federal and state privacy, confidentiality, consumer protection, advertising,
electronic mail, and data security laws and regulations, whether in effect now
or in the future. Fund Company specifically agrees, without limitation of the
foregoing, that names, addresses and Fund share positions of non-objecting
Schwab customers ("NBO information") furnished to it or its Affiliates or agents
pursuant to Rule 14b-1(b)(3) of the Securities Exchange Act of 1934, as amended
(the '34 Act"), will be used only as permitted by Rule 14a-13(b)(4) under the
'34 Act. Each party will maintain and enforce safety and physical security
procedures with respect to its access and maintenance of Customer Information
that are at least equal to industry standards for such types of locations and
which provide reasonably appropriate technical and organizational safeguards
against accidental or unlawful destruction, loss, alteration, or unauthorized
disclosure of or access to Customer Information and any other data owned by
Schwab and accessible by Fund Parties under this Agreement. Fund Parties will
report to Schwab immediately any and all breaches of security or unauthorized
access to Fund Parties' systems that either Fund Party detects or becomes aware
of and which affect the security of Customer Information.
f. Each party acknowledges that any breach of this Section 7 would
result in immediate and irreparable harm for which monetary damages would be
inadequate. Accordingly, each party will be entitled to equitable relief to
remedy any threatened or actual breach of this Section 7 by any other party, as
well as such other relief as any court of competent jurisdiction deems
appropriate.
8. Indemnification.
a. Distributor shall indemnify and hold harmless Schwab and each
director, officer, employee and agent of Schwab and any of its Affiliates from
and against any and all losses, claims, liabilities and expenses (including
reasonable attorney's fees) ("Losses") incurred by any of them arising out of
(i) any untrue statement of material fact or any omission of a material fact
necessary in order to make the statements made, in light of the circumstances
under which they were made, not misleading in any prospectus, registration
statement, annual or other periodic report or proxy statement of the Fund or in
any advertising or promotional material published or provided to Schwab by or on
behalf of Fund Company, Distributor, or any Affiliate of Fund Company, or
accurately derived from information published or provided by or on behalf of
Fund Company, Distributor, or any Affiliate of Fund Company; (ii) any violation
of any law, rule, or regulation relating to the registration or qualification of
shares of the Fund; (iii) any breach by Fund Parties of any representation,
warranty or agreement contained in this Agreement; or (iv) any willful
misconduct or negligence by Fund Parties in the performance of, or failure to
perform, its obligations under this Agreement, except to the extent such Losses
are caused by Schwab or its Affiliates' breach of this Agreement or willful
misconduct or negligence in the performance of, or failure to perform, its
obligations under this Agreement.
x. Xxxxxx shall indemnify and hold harmless Fund Parties, and its
directors, officers, employees, and agents and any of their Affiliates from and
against any and all Losses incurred by any of them arising out of (i) Schwab or
its Affiliates' dissemination of information regarding Fund Company or a Fund
that contains any untrue statement of material fact or any omission of material
fact necessary in order to make the statements made, in light of the
circumstances under which they were made, not misleading and that was not
published or provided to Schwab or its Affiliates by or on behalf of Fund
Company, Distributor, or any Affiliate of Fund Company, or accurately derived
from information published or provided by or on behalf of Fund Company,
Distributor, or any Affiliate of Fund Company, (ii) any breach by Schwab or its
Affiliates of any representation, warranty or agreement contained in this
Agreement, or (iii) any willful misconduct or negligence by Schwab or its
Affiliates in the performance of, or failure to perform, its obligations under
this Agreement, except to the extent such Losses are caused by Fund Company,
Distributor, or any Affiliate of Fund Company's breach of this Agreement, or
willful misconduct or negligence in the performance of, or failure to perform,
its obligations under this Agreement.
c. Except to the extent otherwise expressly provided in this
Agreement, no party assumes any responsibility hereunder, or will be liable to
the other, for any damage, loss of data, delay or any other loss whatsoever
caused by events beyond its reasonable control.
d. These indemnification terms shall survive termination of this
Agreement.
9. Governing Law. This Agreement shall be governed by and interpreted under
the laws of the State of California applicable to contracts between California
residents entered into and to be performed entirely within the State.
10. Arbitration. In the event of a dispute between Fund Parties or either
of them and Schwab relating to or arising out of this Agreement or the
relationship of the parties hereto, the parties will submit the matter to
arbitration in accordance with subsections a., b., and c. below.
a. Arbitration will be held in accordance with the rules and
regulations of the NASD, except, (i) in the event that the NASD is unwilling to
accept jurisdiction of the matter, such arbitration will be held in accordance
with the rules and regulations of the American Arbitration Association, and (ii)
in the event that a non-party to this Agreement brings an arbitration against
Schwab or Fund Parties relating to or arising out of this Agreement, then the
parties agree to arbitrate in whichever arbitration forum such arbitration is
brought.
b. If arbitration is brought by one of the parties hereto, the number
of arbitrators shall be three (3), and they will be selected in accordance with
the rules and regulations of the NASD or American Arbitration Association, as
appropriate. The arbitrators shall be attorneys, or retired attorneys,
specialized in Securities Law. Any award of the arbitrators will be limited to
compensatory damages and will be conclusive and binding upon the parties. The
arbitration shall be governed by the Federal Arbitration Act, 9 U.S.C. Sections
1-16 to the exclusion of state laws inconsistent therewith, and judgment upon
the award may be entered in any court having jurisdiction.
c. Each party shall bear its own expenses, including legal and
accounting fees, if any, with respect to the arbitration. The arbitrator will
designate the party to bear the expenses of the arbitration or the respective
amounts of such expense to be borne by each party. Any costs, fees or taxes
involved in enforcing the award shall be fully assessed against and paid by the
party resisting enforcement of the award.
d. Nothing in this Section 10 will prevent any party from resorting to
judicial proceedings for injunctive relief to prevent serious and irreparable
harm or injury to the party or to others.
11. Exhibits. Fund Parties shall deliver or cause to be delivered to Schwab
a completed Exhibit B and C to establish a Fund in the MFMP. Schwab shall be
entitled to rely on the information contained in the Exhibits B and C, as may be
amended by Fund Parties from time to time, in connection with the purchase and
redemption of Fund shares and the processing of transactions related to Fund
shares. If an Exhibit B or C has been completed and delivered to establish a
Fund in the MFMP under an Operating Agreement, then Fund Parties may, upon
notice to Schwab, adopt such completed and delivered Exhibit for this Agreement,
in which case such Exhibit shall be an Exhibit to both this Agreement and the
Operating Agreement; and any amendment to such Exhibit shall amend both
Agreements.
12. Reliance on Communications. Any communication, instruction or notice
made pursuant to this Agreement may be made orally, provided that such oral
communication is on a recorded telephone line or is promptly confirmed in
writing by facsimile transmission. Each of Schwab and its Affiliates is entitled
to rely on any communications or instructions that it reasonably believes were
provided to it by Distributor, Fund Company or its agents authorized to provide
such communications or instructions to Schwab or its Affiliates. Each
Distributor, Fund Company, and their agents is entitled to rely on any
communications or instructions they reasonably believe were provided to them by
Schwab or its Affiliates, or its agents authorized to provide such
communications or instructions to Distributor, Fund Company, or their agents.
13. Incorporation; Entire Agreement. All Exhibits and Schedules furnished
pursuant to this Agreement, as it may be amended from time to time, are by this
reference incorporated into and made a part of this Agreement. This Agreement
constitutes the entire agreement between the parties as to the subject matter
hereof and supersedes any and all agreements, representations and warranties,
written or oral, regarding such subject matter made prior to the time at which
this Agreement has been executed and delivered by the parties.
14. Amendment.
a. This Agreement may be amended only by a writing executed by each
party hereto that is to be bound by such amendment, except as provided in this
Section 14.
b. Exhibit A may be amended unilaterally by Schwab on forty (40) days'
written notice to Fund Company, unless the parties agree in writing to a shorter
notice period for such amendment, but such amendment will not take effect if
Fund Company notifies Schwab in writing of its objection to such amendment prior
to expiration of the applicable notice period.
c. Exhibit B must be amended unilaterally by Fund Parties in the event
of any change to the information contained therein as to a Fund, and amendment
must occur in a manner timed to coincide with such change so that Schwab may
have opportunity to object to such change as not operationally feasible and
either, in its sole discretion: (A) suspend purchases of shares of such Fund
until such time as such change is operationally feasible for Schwab and the
parties may thus amend this Agreement, or (B) terminate this Agreement as to
such Fund. Notwithstanding the foregoing, Schwab may treat the Exhibit B for a
Fund as immediately amended by any change to the mutual fund information for a
Fund provided by Fund Parties on NSCC's Mutual Fund Profile Service under
Section 4.e. of the Operating Procedures which conflicts with information
provided on Exhibit B, and may require Fund Parties to immediately conform
Exhibit B accordingly.
d. Exhibit C (Fund Contacts) must be amended unilaterally by Fund
Parties in the event of any change to the information contained therein as to a
Fund.
e. Schedule I may be amended unilaterally by Schwab immediately upon
notice to Fund Parties, provided however that any new or changed Networking Fee
or PPMF to be paid to Schwab pursuant to Section 4 of this Agreement ("Fee
Term") shall have been previously approved (including by email) by Fund Parties.
Notwithstanding any such amendment to Schedule I, if a Fee Term has not been
previously approved by the Fund Parties in accordance with this section, then
such new or changed Fee Term shall not become part of this Agreement, but
Schedule I shall remain amended otherwise as provided in Xxxxxx'x notice and the
parties shall proceed to resolve such disputed Fee Term in good faith.
15. Effectiveness and Termination
a. The effective date of this Agreement as to any Fund shall be the
later of the date on which this Agreement is made or the date set forth opposite
the name of the Fund on Schedule I.
b. This Agreement may be terminated as to any Fund by Schwab
immediately upon written notice to Fund Company. This Agreement may be
terminated as to any Fund by Fund Company upon thirty (30) days' written notice
to Schwab.
c. Upon the termination date for any Fund, Schwab will no longer make
the Fund shares available for purchase by investors through the MFMP. Schwab
reserves the right to transfer the Fund shares of MFMP investors out of the
Account. If Schwab continues to hold the Fund shares on behalf of MFMP investors
in the Account, the parties agree to be obligated under, and act in accordance
with, the terms and conditions of this Agreement with respect to such shares.
16. Role and Relationship of Schwab. The parties acknowledge and agree that
any services provided by Schwab under this Agreement are administrative and
related services only and are not the services of an underwriter or a principal
underwriter of any Fund within the meaning of the Securities Act of 1933, as
amended, or the 1940 Act, as applicable. This Agreement also does not constitute
Schwab a transfer agent or an agent of Fund Company, any Fund or any of their
Affiliates, and the parties agree that Schwab acts hereunder as an agent of its
customers and other MFMP investors only.
17. No Waiver. The failure of either party to insist upon exercising any
right under this Agreement in any instance or instances shall not to any extent
preclude such party from asserting or relying upon such right in any other
instance.
18. Counterparts. This Agreement may be executed in one or more
counterparts, each of which will be deemed an original, and all of which
together shall constitute one and the same instrument.
19. Headings. The headings of the sections or other subdivisions of this
Agreement are for convenience of reference only and shall not affect the
meaning, construction, operation, or effect of the terms hereof or otherwise be
considered in the interpretation of this Agreement.
20. Effect of This Agreement. Any Operating Agreement, and, if applicable,
Services Agreement, to which any Fund under this Agreement is also a party are
inapplicable to the shares of such Fund under this Agreement ("Load Operating
Agreement Shares"); and this Agreement is inapplicable to the shares of such
Fund under the Operating Agreement, and, if applicable, Services Agreement
("Operating Agreement Shares"). Load Operating Agreement Shares and Operating
Agreement Shares shall be kept segregated by Schwab.
IN WITNESS WHEREOF, this Agreement has been executed by a duly authorized
representative of the parties hereto.
--------------------------------------------------------------------------------
XXXXXXX XXXXXX & CO., INC. ALLIANCEBERNSTEIN FAMILY OF FUNDS
By: /S/ Xxxx Xxxxx By: /S/ Xxxxxx X. Xxxxx
--------------------------------------------------------------------------------
Xxxx Xxxxx Name: Xxxxx X. Xxxxx
--------------------------------------------------------------------------------
Senior Vice President as Secretary of each Fund Company,
on behalf of each Fund Company and
on behalf of each Fund
--------------------------------------------------------------------------------
Schwab Financial Products Operations Date: 8/2/07
--------------------------------------------------------------------------------
Date: 8/8/07
--------------------------------------------------------------------------------
ALLIANCEBERNSTEIN INVESTMENTS, INC.
--------------------------------------------------------------------------------
By: /S/ Xxxxxx X. Xxxxx
--------------------------------------------------------------------------------
Name: Xxxxxx X. Xxxxx
--------------------------------------------------------------------------------
Title: Assistant Secretary
--------------------------------------------------------------------------------
Date: 8/2/07
--------------------------------------------------------------------------------
SCHEDULE I TO THE LOAD FUND OPERATING AGREEMENT
------------------------------------------------------------------------------------------------------------------------------------
Purchase Networking Effective
Fund Company Fund Share Class Availability PPMF* Fee Date
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Americas AllianceBernstein Global Class A MFMP $16 $6 6/1/07
Government Income Trust, Inc. Government Income Trust
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Americas AllianceBernstein Global Class B MFMP $19/$16 $6 6/1/07
Government Income Trust, Inc. Government Income Trust
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Americas AllianceBernstein Global Class C MFMP $19/$16 $6 6/1/07
Government Income Trust, Inc. Government Income Trust
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Balanced AllianceBernstein Balanced Class A MFMP $16 $6 6/1/07
Shares, Inc. Shares
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Balanced AllianceBernstein Balanced Class B MFMP $19/$16 $6 6/1/07
Shares, Inc. Shares
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Balanced AllianceBernstein Balanced Class C MFMP $19/$16 $6 6/1/07
Shares, Inc. Shares
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Blended Style AllianceBernstein 2020 Class C MFMP $19/$16 $6 6/1/07
Series, Inc. Retirement Strategy
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Blended Style AllianceBernstein 2040 Class C MFMP $19/$16 $6 6/1/07
Series, Inc. Retirement Strategy
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Blended Style AllianceBernstein 2045 Class A MFMP $16 $6 6/1/07
Series, Inc. Retirement Strategy
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Blended Style AllianceBernstein 2045 Class B MFMP $19/$16 $6 6/1/07
Series, Inc. Retirement Strategy
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Blended Style AllianceBernstein 2045 Class C MFMP $19/$16 $6 6/1/07
Series, Inc. Retirement Strategy
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Blended Style AllianceBernstein US Large Cap Class A MFMP $16 $6 6/1/07
Series, Inc. Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Blended Style AllianceBernstein US Large Cap Class B MFMP $19/$16 $6 6/1/07
Series, Inc. Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Blended Style AllianceBernstein US Large Cap Class C MFMP $19/$16 $6 6/1/07
Series, Inc. Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Bond Fund, AllianceBernstein Corporate Class A MFMP $16 $6 6/1/07
Inc. Bond Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Bond Fund, AllianceBernstein Corporate Class B MFMP $19/$16 $6 6/1/07
Inc. Bond Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Bond Fund, AllianceBernstein Corporate Class C MFMP $19/$16 $6 6/1/07
Inc. Bond Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Bond Fund, AllianceBernstein Intermediate Class A MFMP $16 $6 6/1/07
Inc. Bond Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Bond Fund, AllianceBernstein Intermediate Class B MFMP $19/$16 $6 6/1/07
Inc. Bond Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Bond Fund, AllianceBernstein Intermediate Class C MFMP $19/$16 $6 6/1/07
Inc. Bond Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Bond Fund, AllianceBernstein US Government Class B MFMP $16 $6 6/1/07
Inc. Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Bond Fund, AllianceBernstein US Government Class C MFMP $19/$16 $6 6/1/07
Inc. Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Disciplined AllianceBernstein Focused Class A MFMP $16 $6 6/1/07
Value Fund, Inc. Growth & Income Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Disciplined AllianceBernstein Focused Class B MFMP $19/$16 $6 6/1/07
Value Fund, Inc. Growth & Income Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Disciplined AllianceBernstein Focused Class C MFMP $19/$16 $6 6/1/07
Value Fund, Inc. Growth & Income Fund
------------------------------------------------------------------------------------------------------------------------------------
SCHEDULE I TO THE LOAD FUND OPERATING AGREEMENT
{continued}
------------------------------------------------------------------------------------------------------------------------------------
Purchase Networking Effective
Fund Company Fund Share Class Availability PPMF* Fee Date
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Emerging AllianceBernstein Emerging Class A MFMP $16 $6 6/1/07
Market Debt Fund Market Debt Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Emerging AllianceBernstein Emerging Class B MFMP $19/$16 $6 6/1/07
Market Debt Fund Market Debt Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Emerging AllianceBernstein Emerging Class C MFMP $19/$16 $6 6/1/07
Market Debt Fund Market Debt Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Exchange AllianceBernstein Exchange Class A MFMP $16 $6 6/1/07
Reserves Reserves
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Exchange AllianceBernstein Exchange Class B MFMP $19/$16 $6 6/1/07
Reserves Reserves
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Exchange AllianceBernstein Exchange Class C MFMP $19/$16 $6 6/1/07
Reserves Reserves
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Global AllianceBernstein Global Class C MFMP $19/$16 $6 6/1/07
Research Growth Fund, Inc. Research Growth Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Global AllianceBernstein Global Class A MFMP $16 $6 6/1/07
Research Growth Fund, Inc. Research Growth Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Global AllianceBernstein Global Class A MFMP $16 $6 6/1/07
Strategic Income Trust, Inc. Strategic Income Trust
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Global AllianceBernstein Global Class B MFMP $19/$16 $6 6/1/07
Strategic Income Trust, Inc. Strategic Income Trust
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Global AllianceBernstein Global Class C MFMP $19/$16 $6 6/1/07
Strategic Income Trust, Inc. Strategic Income Trust
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Greater China AllianceBernstein Greater China Class A MFMP $16 $6 6/1/07
97 Fund, Inc 97 Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Greater China AllianceBernstein Greater China Class B MFMP $19/$16 $6 6/1/07
97 Fund, Inc 97 Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Greater China AllianceBernstein Greater China Class C MFMP $19/$16 $6 6/1/07
97 Fund, Inc 97 Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Growth & AllianceBernstein Growth & Class A MFMP $16 $6 6/1/07
Income Fund, Inc. Income Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Growth & AllianceBernstein Growth & Class B MFMP $19/$16 $6 6/1/07
Income Fund, Inc. Income Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Growth & AllianceBernstein Growth & Class C MFMP $19/$16 $6 6/1/07
Income Fund, Inc. Income Fund
------------------------------------------------------------------------------------------------------------------------------------
Alliancebernstein Health Care AllianceBernstein Global Health Class A MFMP $16 $6 6/1/07
Fund, Inc. Care Fund
------------------------------------------------------------------------------------------------------------------------------------
Alliancebernstein Health Care AllianceBernstein Global Health Class B MFMP $19/$16 $6 6/1/07
Fund, Inc. Care Fund
------------------------------------------------------------------------------------------------------------------------------------
Alliancebernstein Health Care AllianceBernstein Global Health Class C MFMP $19/$16 $6 6/1/07
Fund, Inc. Care Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein High Yield AllianceBernstein High Yield Class A MFMP $16 $6 6/1/07
Fund Inc Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein High Yield AllianceBernstein High Yield Class B MFMP $19/$16 $6 6/1/07
Fund Inc Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein High Yield AllianceBernstein High Yield Class C MFMP $19/$16 $6 6/1/07
Fund Inc Fund
------------------------------------------------------------------------------------------------------------------------------------
SCHEDULE I TO THE LOAD FUND OPERATING AGREEMENT
{continued}
------------------------------------------------------------------------------------------------------------------------------------
Purchase Networking Effective
Fund Company Fund Share Class Availability PPMF* Fee Date
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein AllianceBernstein Class A MFMP $16 $6 6/1/07
International Premier Growth International Research Growth
Fund, Inc. Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein AllianceBernstein Class B MFMP $19/$16 $6 6/1/07
International Premier Growth International Research Growth
Fund, Inc. Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein AllianceBernstein Class C MFMP $19/$16 $6 6/1/07
International Premier Growth International Research Growth
Fund, Inc. Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Mid Cap AllianceBernstein Mid Cap Class A MFMP $16 $6 6/1/07
Growth Fund, Inc. Growth Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Mid Cap AllianceBernstein Mid Cap Class C MFMP $19/$16 $6 6/1/07
Growth Fund, Inc. Growth Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Mid Cap AllianceBernstein Mid Cap Class C MFMP $19/$16 $6 6/1/07
Growth Fund, Inc. Growth Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein Arizona Class A MFMP $16 $6 6/1/07
Income Fund II Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein Arizona Class B MFMP $19/$16 $6 6/1/07
Income Fund II Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein Arizona Class C MFMP $19/$16 $6 6/1/07
Income Fund II Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein Florida Class A MFMP $16 $6 6/1/07
Income Fund II Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein Florida Class B MFMP $19/$16 $6 6/1/07
Income Fund II Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein Florida Class C MFMP $19/$16 $6 6/1/07
Income Fund II Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein Class A MFMP $16 $6 6/1/07
Income Fund II Massachusetts Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein Class B MFMP $19/$16 $6 6/1/07
Income Fund II Massachusetts Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein Class C MFMP $19/$16 $6 6/1/07
Income Fund II Massachusetts Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein Michigan Class A MFMP $16 $6 6/1/07
Income Fund II Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein Michigan Class B MFMP $19/$16 $6 6/1/07
Income Fund II Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein Michigan Class C MFMP $19/$16 $6 6/1/07
Income Fund II Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein Minnesota Class A MFMP $16 $6 6/1/07
Income Fund II Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein Minnesota Class B MFMP $19/$16 $6 6/1/07
Income Fund II Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein Minnesota Class C MFMP $19/$16 $6 6/1/07
Income Fund II Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein New Jersey Class A MFMP $16 $6 6/1/07
Income Fund II Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein New Jersey Class B MFMP $19/$16 $6 6/1/07
Income Fund II Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein New Jersey Class C MFMP $19/$16 $6 6/1/07
Income Fund II Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein Ohio Class A MFMP $16 $6 6/1/07
Income Fund II Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein Ohio Class B MFMP $19/$16 $6 6/1/07
Income Fund II Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein Ohio Class C MFMP $19/$16 $6 6/1/07
Income Fund II Portfolio
------------------------------------------------------------------------------------------------------------------------------------
SCHEDULE I TO THE LOAD FUND OPERATING AGREEMENT
{continued}
------------------------------------------------------------------------------------------------------------------------------------
Purchase Networking Effective
Fund Company Fund Share Class Availability PPMF* Fee Date
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein Pennsylvania Class A MFMP $16 $6 6/1/07
Income Fund II Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein Pennsylvania Class B MFMP $19/$16 $6 6/1/07
Income Fund II Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein Pennsylvania Class C MFMP $19/$16 $6 6/1/07
Income Fund II Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein Virginia Class A MFMP $16 $6 6/1/07
Income Fund II Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein Virginia Class B MFMP $19/$16 $6 6/1/07
Income Fund II Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein Virginia Class C MFMP $19/$16 $6 6/1/07
Income Fund II Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein California Class A MFMP $16 $6 6/1/07
Income Fund, Inc. Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein California Class B MFMP $19/$16 $6 6/1/07
Income Fund, Inc. Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein California Class C MFMP $19/$16 $6 6/1/07
Income Fund, Inc. Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein Insured Class A MFMP $16 $6 6/1/07
Income Fund, Inc. California Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein Insured Class B MFMP $19/$16 $6 6/1/07
Income Fund, Inc. California Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein Insured Class C MFMP $19/$16 $6 6/1/07
Income Fund, Inc. California Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein Insured Class A MFMP $16 $6 6/1/07
Income Fund, Inc. National Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein Insured Class B MFMP $19/$16 $6 6/1/07
Income Fund, Inc. National Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein Insured Class C MFMP $19/$16 $6 6/1/07
Income Fund, Inc. National Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein National Class A MFMP $16 $6 6/1/07
Income Fund, Inc. Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein National Class B MFMP $19/$16 $6 6/1/07
Income Fund, inc. Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein National Class C MFMP $19/$16 $6 6/1/07
Income Fund, Inc. Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein New York Class A MFMP $16 $6 6/1/07
Income Fund, Inc. Portfolio
------------------------------------------------------------------------------------------------------------------------------------
SCHEDULE I TO THE LOAD FUND OPERATING AGREEMENT
{continued}
------------------------------------------------------------------------------------------------------------------------------------
Purchase Networking Effective
Fund Company Fund Share Class Availability PPMF* Fee Date
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein New York Class B MFMP $19/$16 $6 6/1/07
Income Fund, Inc. Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Municipal AllianceBernstein New York Class C MFMP $19/$16 $6 6/1/07
Income Fund, Inc. Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Portfolios AllianceBernstein Balanced Class A MFMP $16 $6 6/1/07
Wealth Strategy
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Portfolios AllianceBernstein Balanced Class B MFMP $19/$16 $6 6/1/07
Wealth Strategy
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Portfolios AllianceBernstein Balanced Class C MFMP $19/$16 $6 6/1/07
Wealth Strategy
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Portfolios AllianceBernstein Growth Fund Class A MFMP $16 $6 6/1/07
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Portfolios AllianceBernstein Growth Fund Class B MFMP $19/$16 $6 6/1/07
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Portfolios AllianceBernstein Growth Fund Class C MFMP $19/$16 $6 6/1/07
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Portfolios AllianceBernstein Tax Managed Class A MFMP $16 $6 6/1/07
Balance Wealth Strategy
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Portfolios AllianceBernstein Tax Managed Class B MFMP $19/$16 $6 6/1/07
Balance Wealth Strategy
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Portfolios AllianceBernstein Tax Managed Class C MFMP $19/$16 $6 6/1/07
Balance Wealth Strategy
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Portfolios AllianceBernstein Tax Managed Class A MFMP $16 $6 6/1/07
Wealth Preservation Strategy
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Portfolios AllianceBernstein Tax Managed Class B MFMP $19/$16 $6 6/1/07
Wealth Preservation Strategy
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Portfolios AllianceBernstein Tax Managed Class C MFMP $19/$16 $6 6/1/07
Wealth Preservation Strategy
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Portfolios AllianceBernstein Tax-Managed Class A MFMP $16 $6 6/1/07
Wealth Appreciation Strategy
------------------------------------------------------------------------------------------------------------------------------------
SCHEDULE I TO THE LOAD FUND OPERATING AGREEMENT
{continued}
------------------------------------------------------------------------------------------------------------------------------------
Purchase Networking Effective
Fund Company Fund Share Class Availability PPMF* Fee Date
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Portfolios AllianceBernstein Tax-Managed Class B MFMP $19/$16 $6 6/1/07
Wealth Appreciation Strategy
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Portfolios AllianceBernstein Tax-Managed Class C MFMP $19/$16 $6 6/1/07
Wealth Appreciation Strategy
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Portfolios AllianceBernstein Wealth Class A MFMP $16 $6 6/1/07
Appreciation Strategy
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Portfolios AllianceBernstein Wealth Class B MFMP $19/$16 $6 6/1/07
Appreciation Strategy
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Portfolios AllianceBernstein Wealth Class C MFMP $19/$16 $6 6/1/07
Appreciation Strategy
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Portfolios AllianceBernstein Wealth Class A MFMP $16 $6 6/1/07
Preservation Strategy
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Portfolios AllianceBernstein Wealth Class B MFMP $19/$16 $6 6/1/07
Preservation Strategy
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Portfolios AllianceBernstein Wealth Class C MFMP $19/$16 $6 6/1/07
Preservation Strategy
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Premier AllianceBernstein Large Cap Class A MFMP $16 $6 6/1/07
Growth Fund, Inc. Growth Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Premier AllianceBernstein Large Cap Class B MFMP $19/$16 $6 6/1/07
Growth Fund, Inc. Growth Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Premier AllianceBernstein Large Cap Class C MFMP $19/$16 $6 6/1/07
Growth Fund, Inc. Growth Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Real Estate AllianceBernstein Global Real Class A MFMP $16 $6 6/1/07
Investment Trust, Inc. Estate Investment Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Real Estate AllianceBernstein Global Real Class B MFMP $19/$16 $6 6/1/07
Investment Trust, Inc. Estate Investment Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Real Estate AllianceBernstein Global Real Class C MFMP $19/$16 $6 6/1/07
Investment Trust, Inc. Estate Investment Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Small Cap AllianceBernstein Small Cap Class A MFMP $16 $6 6/1/07
Growth Fund, Inc. Growth Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Small Cap AllianceBernstein Small Cap Class B MFMP $19/$16 $6 6/1/07
Growth Fund, Inc. Growth Portfolio
------------------------------------------------------------------------------------------------------------------------------------
SCHEDULE I TO THE LOAD FUND OPERATING AGREEMENT
{continued}
------------------------------------------------------------------------------------------------------------------------------------
Purchase Networking Effective
Fund Company Fund Share Class Availability PPMF* Fee Date
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Small Cap AllianceBernstein Small Cap Class C MFMP $19/$16 $6 6/1/07
Growth Fund, Inc. Growth Portfolio
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Technology AllianceBernstein Global MFMP $16 $6 6/1/07
Fund, Inc. Technology Fund Class A
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Technology AllianceBernstein Global Class B MFMP $19/$16 $6 6/1/07
Fund, Inc. Technology Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Technology AllianceBernstein Global Class C MFMP $19/$16 $6 6/1/07
Fund, Inc. Technology Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Trust AllianceBernstein Global Class A MFMP $16 $6 6/1/07
Value Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Trust AllianceBernstein Global Class B MFMP $19/$16 $6 6/1/07
Value Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Trust AllianceBernstein Global Class C MFMP $19/$16 $6 6/1/07
Value Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Trust AllianceBernstein Class A MFMP $16 $6 6/1/07
International Value Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Trust AllianceBernstein Class B MFMP $19/$16 $6 6/1/07
International Value Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Trust AllianceBernstein Class C MFMP $19/$16 $6 6/1/07
International Value Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Trust AllianceBernstein Small/Mid Class A MFMP $16 $6 6/1/07
Cap Value Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Trust AllianceBernstein Small/Mid Class B MFMP $19/$16 $6 6/1/07
Cap Value Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Trust AllianceBernstein Small/Mid Class C MFMP $19/$16 $6 6/1/07
Cap Value Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Trust AllianceBernstein Value Fund Class A MFMP $16 $6 6/1/07
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Trust AllianceBernstein Value Fund Class B MFMP $19/$16 $6 6/1/07
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Trust AllianceBernstein Value Fund Class C MFMP $19/$16 $6 6/1/07
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Utility AllianceBernstein Utility Class A MFMP $16 $6 6/1/07
Income Fund, Inc. Income Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Utility AllianceBernstein Utility Class B MFMP $19/$16 $6 6/1/07
Income Fund, Inc. Income Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Utility AllianceBernstein Utility Class C MFMP $19/$16 $6 6/1/07
Income Fund, Inc. Income Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Worldwide AllianceBernstein Class A MFMP $16 $6 6/1/07
Privatization Fund, Inc. International Growth Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Worldwide AllianceBernstein Class B MFMP $19/$16 $6 6/1/07
Privatization Fund, Inc. International Growth Fund
------------------------------------------------------------------------------------------------------------------------------------
AllianceBernstein Worldwide AllianceBernstein Class C MFMP $19/$16 $6 6/1/07
Privatization Fund, Inc. International Growth Fund
------------------------------------------------------------------------------------------------------------------------------------
----------
* The PPMF shall be either $19 or $16, depending on whether or not the
position has shares subject to a CDSC. Any position that includes shares
subject to a CDSC will be subject to the $19 fee. Any position that does
not include shares subject to a CDSC shall be subject to the $16 fee.
MFMP Indicates that Fund can be made available for purchase to all MFMP
investors.
EXHIBIT A
---------
Operating Procedures
1. Accounts.
a. Account Opening. Schwab may open Omnibus Account(s) and Sub-Accounts
with each Fund, which shall each be established and maintained pursuant to
Networking.
b. Registration of Accounts.
Each Account shall be registered:
Xxxxxxx Xxxxxx & Co., Inc.
Special Custody Account for the Exclusive Benefit of Customer(s)
Attention: Mutual Funds
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Xxxxxx'x TIN on an Account through the NSCC system will identify it as an
Omnibus Account. Schwab will note on each Sub-Account through the NSCC system
the BIN, SSN/TIN, state and zip code of the account address of the MFMP
investor.
c. Account Set Up for Capital Gains and Dividends.
(i) Each Omnibus Account will be set up for the reinvestment of
capital gains and dividend distributions, unless otherwise specified in writing
by Schwab.
(ii) Schwab will designate whether capital gains and/or dividend
distributions for each Sub-Account should be received in cash or reinvested in
shares of the applicable Fund.
d. Account Identification. The Fund shall designate each Omnibus Account
and each Sub-Account with an account number. The account number will be the
means of identification when the parties are transacting in either an Omnibus
Account or a Sub-Account.
e. Electronic Access to Accounts. Fund Partyshall arrange with the Fund's
transfer agent for Schwab to have electronic access to the transfer agent system
for account inquiry capability on all information maintained by the transfer
agent with respect to each Account.
f. Possession and Control. The parties acknowledge that each Account is in
Xxxxxx'x name for the benefit of an MFMP investor or MFMP investors who are the
beneficial owners of a Fund's shares. Fund Company agrees that all Fund shares
held by Schwab on behalf of MFMP investors shall be carried in a custody account
for the exclusive benefit of customers and shall not be subject to any right,
charge, security interest, lien, or other claim against Schwab in favor of the
Fund or Fund Company.
g. No Closure of Omnibus Accounts. The Omnibus Accounts shall be kept open
on the Fund's books regardless of a lack of activity or small position size,
except to the extent that Schwab takes specific action to close an Omnibus
Account or otherwise provides its written consent to such closure.
h. Additional Accounts. Schwab has the right to open additional Accounts
from time to time to accommodate other investment options and features, and to
consolidate existing accounts if and when appropriate to meet the needs of the
MFMP. Fund Company agrees that it will not establish additional accounts for
Schwab without Xxxxxx'x prior written instruction.
i. Reservation of Right to Move Shares. Schwab reserves the right to issue
instructions to each Fund to move shares between an Account and any other
Account Schwab may open.
j. Conversion between Sub-Accounts and Omnibus Accounts. In the event
Sub-Accounts are to be combined into Omnibus Accounts or Omnibus Accounts are to
be divided into Sub-Accounts, which Schwab may determine in its sole discretion
from time to time, Fund Company shall reasonably cooperate with Schwab to
accomplish such planned conversion. Schwab shall discuss with Fund Company a
conversion plan and shall obtain consent from Fund Company for the timing of
such conversion, which consent shall not be unreasonably withheld. The
conversion plan shall include procedures for conversion, procedures and
reasonable time frames for resolving discrepancies arising from the conversion,
procedures for conversion between billing and payment of Networking fees and the
PPMF under Sections 4.a. and 4.b. of the Agreement, an approximation of the
number of Sub-Accounts in the case of conversion of Omnibus to Sub-Accounts, and
such other matters as necessary to effect the conversion.
k. Tax Withholding. Schwab shall comply in all respects with any and all
applicable obligations relating to withholding pursuant to the Internal Revenue
Code of 1986, as amended ("Code"), and shall promptly advise Fund Company of any
matter that may affect the responsibilities of the Fund Company to MFMP
investors pursuant to the Code.
l. Account Transfer Agent Records and Reconciliation of Sub-Accounts. The
official transfer agent records of each Account shall be as determined by Fund
Company. Schwab and Fund Company shall each designate liaison personnel to
communicate, control, and execute promptly any required corrections or
reconciliations with respect to any Sub-Account, and shall handle such activity
with respect to Omnibus Accounts as set forth in 1.m. below.
m. Reconciliation of Omnibus Accounts.
(i) Schwab shall verify, on a next day basis, Orders (as defined
below) placed for any Omnibus Account with a Fund. All activity in the Omnibus
Account must be reflected. Therefore, any "as of" activity must be shown with
its corresponding "as of" dates.
(ii) The Fund will provide to Schwab full daily activity detail and,
at a minimum, weekly account positions via NSCC or other electronic
transmission, unless otherwise mutually agreed upon by the parties.
(iii) Schwab will provide a daily activity report to each Fund for
each such Fund's Omnibus Account(s). In addition, (A) with respect to any Fund
with a contingent deferred redemption fee ("CDSC"), Schwab shall provide a
periodic report on the aging of CDSC share lots in the Omnibus Account(s) and a
daily or periodic report on CDSC share lot conversions (pursuant to Section
11.e. of these Operating Procedures) for each such Fund's Omnibus Account(s),
and (B) with respect to any Fund with aging rules for Rule 12b-1 Plan payments,
Schwab shall provide a periodic report on the aging of Rule 12b-1 Plan share
lots for each such Fund's Omnibus Account(s).
(iv) The parties agree to notify each other and correct any error in
any Omnibus Account with a Fund upon discovery. If an error is not corrected by
the day following discovery, all parties agree to make best efforts to avoid
this from hindering any routine daily operational activity in the Omnibus
Account.
2. Shareholder Information.
a. Agreement to Provide Information. As a financial intermediary to each
Fund under Rule 22c-2, promulgated pursuant to the 1940 Act ("Rule 22c-2"), on
and after October 16, 2007, or such earlier date as Schwab notifies Fund Parties
that MFMP systems are able to accommodate the request ("Compliance Date"),
Schwab agrees to provide a Fund, other than a Fund which is an "excepted fund"
as defined in Rule 22c-2(b), upon written request in a form reasonably required
by Schwab and as otherwise set forth in this Section 2.a., the taxpayer
identification number ("TIN") or, in the case of non-U.S. shareholders for whom
a TIN is unavailable, the International Taxpayer Identification Number or other
government issued identifier, if known, of any: (A) beneficial owners of Fund
shares; (B) retirement plan participants; or (C) holders of interests in a
variable annuity or variable life insurance contract ("Shareholder(s)") that
purchased, redeemed, transferred or exchanged shares of the Fund through the
Omnibus Account(s) during the period covered by the request, and the amounts and
dates of each such purchase, redemption, transfer, or exchange of shares
("Shareholder Information").
(i) Period Covered by Request. All requests for Shareholder
Information must set forth the specific date(s) or period after the Compliance
Date for which the information is sought. If a Fund deems it necessary to
request Shareholder Information older than ninety (90) days from the date of
request, the Fund acknowledges that such request will precipitate a longer
response time.
(ii) Form and Timing of Response. Schwab agrees, on and after the
Compliance Date and subject to the terms of this Section 2.a., to transmit the
Shareholder Information that is on its books and records to the Fund as soon as
reasonably practicable after Xxxxxx'x receipt of a request. If the requested
information pertains to a Shareholder investing through an account held by an
indirect intermediary, as defined in Rule 22c-2 ("Indirect Intermediary"), and
is not on Xxxxxx'x books and records, Schwab agrees, upon further request by the
Fund, to use reasonable efforts to: (a) promptly obtain the Shareholder
Information from the Indirect Intermediary and transmit that information to the
Fund; (b) obtain assurances from the Indirect Intermediary that the Shareholder
Information will be provided directly and promptly to the Fund; or (c) if the
Shareholder Information cannot be provided pursuant to (a) and (b) above, block
further purchases and exchanges of Fund shares in the Indirect Intermediary
account. Schwab agrees to inform the Fund regarding which of the foregoing
options it will follow. The Shareholder Information will be communicated to the
Fund in a format consistent with the NSCC Standardized Data Reporting Format, or
in such other format as may be mutually agreed upon by the parties.
b. Agreement to Restrict Trading. Schwab agrees, on and after the
Compliance Date and subject to the terms of this Section 2.b., to execute
written instructions from the Fund to restrict or prohibit further purchases or
exchanges of shares by a Shareholder that has been identified by the Fund as
having engaged in transactions of the Fund's shares, either directly or
indirectly through Xxxxxx'x Account(s), that violate policies established by the
Fund for the purpose of eliminating or reducing dilution of the value of the
Fund's shares ("Restriction Instructions"). If the Restriction Instructions
pertain to a Shareholder investing through an account held by an Indirect
Intermediary, Schwab will forward the Restriction Instructions to the Indirect
Intermediary, and either (A) obtain assurances from the Indirect Intermediary
that it will promptly execute the Restriction Instructions, or (B) if the
Indirect Intermediary cannot execute the Restriction Instructions, block all
further purchases and exchanges of Fund shares in the Indirect Intermediary
account.
(i) Form of Instructions. Restriction Instructions must be received by
Schwab in writing in a form required by Schwab.
(ii) Timing of Response. Schwab agrees to execute, and to obtain
assurances that any Indirect Intermediary will execute, the Restriction
Instructions according to the terms set forth herein as soon as reasonably
practicable, but not later than five (5) Business Days after receipt of the
Restriction Instructions by Schwab.
(iii) Confirmation by Schwab. Schwab will provide confirmation to the
Fund, in writing or in a manner mutually agreed upon by the parties, that Schwab
has, as applicable, either (a) executed the Restriction Instructions, (b)
obtained assurances from the Indirect Intermediary that it has executed the
Restriction Instructions, or (c) blocked further purchases and exchanges of Fund
Shares in the Indirect Intermediary's account. Schwab agrees to provide such
confirmation as soon as reasonably practicable, but not later than ten (10)
Business Days after such action has been taken.
c. Anti-Dilution Policy Compliance Pending Rule 22c-2. Until the Compliance
Date, Schwab shall provide such information concerning MFMP investors through
the Account(s) ("Investor Information") as Fund Company requests on behalf of
each Fund for purposes of each Fund's compliance with its own policies
established for the purpose of eliminating or reducing dilution of the value of
outstanding securities issued by the Fund including, without limitation,
policies concerning roundtrips and other forms of market timing and excessive
trading (collectively, "Anti-Dilution Policy"), but not more than Schwab
customarily makes available to funds participating in Xxxxxx'x Mutual Fund
Marketplace from time to time, as determined in Xxxxxx'x sole discretion, and as
is required by applicable law, rule, or regulation. Fund Company acknowledges
and agrees that it has been informed of the parameters of such provision of
Investor Information by Schwab and has determined that it is sufficient for each
Fund to determine compliance with its own Anti-Dilution Policy. If at any time
Fund Company concludes that the Investor Information Schwab provides is no
longer sufficient for a Fund to make such determination, Fund Company shall in
writing instruct Schwab to suspend further purchases of such Fund' shares
through Xxxxxx'x Mutual Fund Marketplace until such time as the Fund can make
such determination with the Investor Information provided by Schwab.
d. Limitations on Use of Information. The Investor Information (and
Shareholder Information, on and after the Compliance Date) is provided by Schwab
to Fund Company subject to Fund Company's compliance with the terms and
conditions governing Customer Information under this Agreement. Fund Company
shall not use the Investor Information (or Shareholder Information, on and after
the Compliance Date) received pursuant to this Section for marketing or any
other purposes other than for the purpose of eliminating or reducing dilution of
the value of Fund shares.
e. Definition of "Purchase". For purposes of Section 2 of this Exhibit A,
the term "purchase" does not include the automatic reinvestment of dividends.
3. Authorization to Receive Orders on Fund's Behalf.
a. Authorization of Schwab. Fund Company hereby designates and authorizes
Schwab to receive purchase and redemption orders in proper form ("Order(s)")
from MFMP investors on the Fund's behalf for purposes of Rule 22c-1 under the
1940 Act, so that any such MFMP investor will receive the share price next
computed by the Fund after the time at which such MFMP investor places its Order
with Schwab.
b. Authorization of Sub-Designees. Fund Company further agrees that Schwab
may designate and authorize such intermediaries as it deems necessary,
appropriate or desirable ("Sub-Designees"), to receive Orders from MFMP
investors on the Fund's behalf for purposes of Rule 22c-1 under the 1940 Act, so
that any such MFMP investor will receive the share price next computed by the
Fund after the time at which such MFMP investor places its Order with
Sub-Designee. Schwab shall be liable to Fund Company and the Funds for
compliance with the terms of this Section 3.b. to the same extent as if Schwab
itself had acted or failed to act instead of the Sub-Designee.
c. Fund Company Representations and Warranties. In connection with this
Section 3, Fund Company represents and warrants to Schwab that all necessary
legal and other actions have been taken to authorize Schwab and any Sub-Designee
to receive purchase and redemption Orders from MFMP investors on behalf of the
Funds for purposes of Rule 22c-1 under the 1940 Act by each Fund's board of
directors or board of trustees, and that it will cause each Fund's board of
directors or board of trustees to take such necessary legal and other actions
regarding the annual review of such authorization.
x. Xxxxxx Representations and Warranties. In connection with this Section
3, Schwab represents and warrants that:
(i) Xxxxxx'x internal control structure over the processing and
transmission of Orders for Fund transactions is suitably designed to prevent or
detect on a timely basis Orders received after Market Close from being
aggregated with Orders received before Market Close and to minimize errors that
could result in late transmission of Orders to the Funds ("Internal Control
Procedures").
(ii) Schwab will review annually the adequacy of its Internal Control
Procedures and will change and modify them as necessary to maintain their
adequacy.
(iii) Each Sub-Designee will be required to adopt and implement
written internal controls adequate to prevent or detect on a timely basis Orders
received after Market Close from being aggregated with Orders received before
Market Close ("Sub-Designee Internal Control Procedures").
(iv) Each Sub-Designee will be required to review annually the
adequacy of its Sub-Designee Internal Control Procedures and to change and
modify them as necessary to maintain their adequacy.
(v) Upon request by Fund Company, Schwab will provide Fund Company
with a description of its Internal Control Procedures and a certification from
Schwab that they are adequate as of the most recent annual review as well as a
certification that each Sub-Designee has adopted and implemented Sub-Designee
Internal Control Procedures that are adequate as of the most recent annual
review.
4. NSCC.
a. In General. Unless otherwise agreed to by the parties, each Account
maintained at NSCC will be maintained in accordance with Matrix Level 3 (full
broker control) as designated by the NSCC.
b. NSCC Covenants. Schwab and Fund Company agree (i) to perform any and all
duties, functions, procedures, and responsibilities assigned to them by NSCC
rules, procedures, or other requirements relating to Fund/SERV ("NSCC
Fund/SERV"), Defined Contribution Clearance and Settlement ("DCC&S"), Networking
("Networking"), and the NSCC's Mutual Fund Profile Service ("MFPS") as
applicable, in a competent manner; (ii) to maintain facilities, equipment, and
skilled personnel sufficient to perform the foregoing activities; (iii) that any
information provided to the other party through Fund/SERV, Networking, DCC&S,
and MFPS will be accurate, complete, and in the format prescribed by the NSCC;
(iv) to adopt, implement, and maintain procedures reasonably designed to ensure
the accuracy of all transmissions through Fund/SERV, Networking, DCC&S, and
MFPS, and (v) to limit the access to, and the inputting of data into, Fund/SERV,
Networking, DCC&S, and MFPS to persons specifically authorized by the party.
c. Fund/SERV Transactions. On each Business Day, Fund Company agrees (i) to
accept and effect changes in its records upon receipt of purchase, redemption
and registration instructions from Schwab electronically through Fund/SERV; (ii)
to process any instructions received from Schwab through Fund/SERV in a timely
manner; and (iii) to use reasonable efforts to confirm or reject any Fund
purchase or redemption Order on the same day such Order is received from Schwab
through Fund/SERV but in any event no later than the next opening of the New
York Stock Exchange ("Market Open"), or to notify Schwab prior to Market Open of
any event, such as a systems failure of Fund Company or the NSCC, that would
prohibit Fund Company from confirming or rejecting such an Order. Fund Company
acknowledges and agrees that its confirmation of any Fund purchase or redemption
Order received from Schwab through Fund/SERV will be an acceptance of such
Order, and that such acceptance may be revoked only upon Xxxxxx'x receipt of a
revocation of acceptance prior to Market Open. If Fund Company does not confirm
or reject an Order prior to Market Open or notify Schwab as provided in this
Section prior to Market Open, such Order will be deemed confirmed and accepted
by Fund Company immediately after Market Open.
d. Networking. For each Account established and/or maintained pursuant to
Networking, Fund Company shall accept and effect changes in its records upon
receipt of instructions, communications and actions from Schwab electronically
through Networking without supporting documentation from Schwab or the
beneficial owners of Fund shares. Fund Company shall be responsible for
processing any such instructions, communications or actions from Schwab and for
executing the instructions of Schwab in a timely manner.
e. NSCC's Mutual Fund Profile Service. Fund Company shall provide Schwab
with mutual fund information for each Fund in a timely manner through MFPS.
"Mutual fund information" shall be as prescribed by the MFPS and shall include,
but not be limited to, as applicable: sales charge, breakpoint qualification,
discount linkage, waiver, broker's commission or concession, 12b-1 Plan fee, and
the rules governing each; the daily net asset value and, if applicable, public
offering price of Fund shares; Blue Sky qualification information; dividend and
distribution information; and merger and Fund closing information. Schwab shall
be entitled to rely on any mutual fund information provided through MFPS, even
if such mutual fund information conflicts with any verbal or other written
information provided by Fund Company under this Agreement, including that
provided on Exhibit B.
5. Trade Processing.
a. Transmission of Orders. Schwab will transmit Orders to Fund Company via
NSCC in a Fund/SERV file format, except as provided below.
(i) Orders Transmitted Through NSCC's Fund/SERV. Except as set forth
in Sections 5.a.(ii) and 5.b.(i) below, (1) Orders received by Schwab or a
Sub-Designee prior to the close of the New York Stock Exchange (generally, 4:00
p.m. Eastern Time) ("Market Close") on any Business Day ("Day 1") (such Orders
are referred to herein as "Day 1 Trades") will be transmitted by Schwab to Fund
Company through NSCC in a Fund/SERV file format in the manner and within the
time frame permitted by NSCC Fund/SERV Rules on Day 1 (Schwab will notify Fund
Company of the need for exception processing under Section 5.b. by 8:00 p.m.
Eastern Time on Day 1) ; and (2) Orders received by Schwab or a Sub-Designee at
or after Market Close on Day 1 (such Orders are referred to herein as "Day 2
Trades") will be transmitted by Schwab to Fund Company through NSCC in a
Fund/SERV file format in the manner and within the time frame permitted by NSCC
Fund/SERV Rules on the next Business Day ("Day 2") (Schwab will notify Fund
Company by 8:00 p.m. Eastern Time on Day 2 in the event of the need for
exception processing under Section 5.b.(i).
(ii) Orders Transmitted Outside NSCC's Fund/SERV. If transmittal of
Orders through NSCC is not operationally feasible for a Fund in accordance with
these Operating Procedures, and except as set forth in Section 5.b.(i) below,
(1) Orders received by Schwab or a Sub-Designee prior to Market Close on Day 1
will be transmitted by Schwab to the Fund by other means by 8:00 p.m. Eastern
Time on Day 1 (also "Day 1 Trades"); and (2) Orders received by Schwab or
Sub-Designees at or after Market Close on Day 1 will be transmitted by Schwab to
the Fund by other means by 8:00 p.m. Eastern Time on Day 2 (also "Day 2
Trades").
b. Transmission Exceptions. Notwithstanding Sections 5.a.(i) and (ii)
above,
(i) Fund Company agrees that if Schwab is prevented from transmitting
Day 1 Trades to a Fund as provided in Sections 5.a.(i) or 5.a.(ii) above, as
applicable, on Day 1 due to unforeseen circumstances (such as computer system
failures experienced by Schwab, or the NSCC, natural catastrophes, or other
emergencies), provided that Schwab notifies Fund Company of such contingency
prior to 8:00 p.m. Eastern Time on Day 1, Schwab may:
(1) transmit such Day 1 Trades for an Omnibus Account to the Fund
through NSCC prior to 8:00 p.m. Eastern Time on Day 2, provided further that
Schwab notifies Fund Company of the Day 1 Trade information prior to Market Open
on Day 2;
(2) transmit such Day 1 Trades for an Omnibus Account through
means other than NSCC prior to Market Open on Day 2 or such other mutually
agreed upon time; or
(3) transmit such Day 1 Trades for Sub-Accounts through NSCC as
soon as operationally feasible, provided further that Schwab notifies Fund
Company of the Day 1 Trade information prior to Market Open on Day 2. For any
transmission exception processed by Schwab under this Section 5.b.(i), Schwab
will provide upon request by Fund Company a written explanation of the
circumstances that prevented Schwab from transmitting the Day 1 Trades to the
Fund as provided in Section 5.a.(i) or 5.a.(ii) above.
(ii) Rejected Trades Remediated. In the event that Fund Company
rejects a Day 1 Trade transmitted via NSCC (or the Fund notifies Schwab pursuant
to Section 4.c.(iii) above that it would have rejected the Day 1 Trade had there
not been systems error), and the parties agree that such rejection can be
remediated by Schwab, Schwab may follow the procedures for transmitting Orders
set forth in Section 5.b.(i) above for Day 1 Trades.
c. Transmission of Order Information. With respect to any Order placed for
an Account, Schwab shall provide electronic or other written notification to
Fund Parties, contemporaneously with each such transmission, of the applicable
sales charges, Discounts, and short term redemption fees (under Section 7.f. of
these Operating Procedures) assessed on the Order (i) for such MFMP investor, as
to an Order for a Sub-Account, and (ii) for such MFMP investor or investors, as
to an Order for an Omnibus Account ("Order Information"). Fund Company shall
cooperate reasonably to allow Schwab, at Xxxxxx'x request and upon the provision
by Schwab of the appropriate registration and linkage information, to allow MFMP
investors rights of accumulation based on Fund shares held in accounts directly
with the Fund or by other brokers or banks. Schwab represents and warrants that
it or an intermediary clearing transactions through it holds documentary
validation for each waiver of a contingent deferred sales charge transmitted as
Order Information pursuant to this Section; that it will retain such for the
period required by any law, rule, or regulation; and that it will make such
documents available to Fund Parties in an agreed manner upon reasonable notice.
Fund Parties shall not, in any instance, charge any sales loads or give any
Discounts, including breakpoint Discounts, on any Order for an Omnibus Account
without Order Information from Schwab directing such action. Fund Company
expressly acknowledge that only Schwab has information concerning the individual
order(s) making up the aggregate purchase or redemption Order placed for an
Omnibus Account, and that Fund Parties must use Xxxxxx'x Order Information to
accurately process such Orders.
6. Fund's Pricing of Orders.
a. Pricing Information. On every Business Day, Fund Company will provide to
Schwab prior to 7:00 p.m., Eastern Time, each Fund's closing net asset value,
and public offering price if applicable, for that day ("Share Price") and/or
notification of no Share Price for that day. Fund Company shall provide such
information on a best efforts basis taking into consideration any extraordinary
circumstances arising at the Fund (e.g. natural disasters, etc.).
b. Pricing of Orders. If timely transmitted by Schwab in accordance with
Section 5.a. above for regular processing, or in accordance with Section 5.b.
above for exception processing upon notification, Fund Company agrees that (a)
Day 1 Trades will be effected at the Share Price calculated as of Market Close
on Day 1, and (b) Day 2 Trades will be effected at the Share Price calculated as
of Market Close on Day 2. Fund Company agrees that, consistent with the
foregoing, Day 1 Trades will have been received by the Fund prior to Market
Close on Day 1, and Day 2 Trades will have been received by the Fund prior to
Market Close on Day 2, for all purposes, including, without limitation,
settlement and effecting distributions.
7. Order Settlement and Redemption Fees.
a. Settlement Date. Schwab and Fund Company shall settle Day 1 Trades,
including Day 1 Trades rejected and subsequently remediated prior to Market Open
on Day 2 pursuant to Section 5.b.(ii) hereof, on Day 2, and shall settle Day 2
Trades, including Day 2 Trades rejected and subsequently remediated prior to
Market Open on Day 3 pursuant to Section 5.b.(ii) hereof, on Day 3 (each,
respectively, a "Settlement Date"). Notwithstanding the foregoing, the parties
may agree to "T+3" settlement in Sub-Accounts as to a Fund, and if so, with
respect to the Sub-Accounts for such Fund, Schwab and Fund Company shall settle
Day 1 Trades, including Day 1 Trades rejected and subsequently remediated prior
to Market Open on Day 2 pursuant to Section 5.b.(ii) hereof, on Day 4, and shall
settle Day 2 Trades, including Day 2 Trades rejected and subsequently remediated
prior to Market Open on Day 3 pursuant to Section 5.b.(ii) hereof, on Day 5
(each respectively, but only with respect to such agreed Sub-Accounts, also a
"Settlement Date").
b. Method of Settlement.
(i) All Orders transmitted by Schwab outside of NSCC shall be settled
by Schwab and Fund Company outside of NSCC on the appropriate Settlement Date.
(ii) All Orders transmitted by Schwab through NSCC to a Sub-Account
shall be settled by Schwab and Fund Company through the NSCC's money settlement
process on the appropriate Settlement Date.
(iii) All Orders transmitted by Schwab through NSCC to an Omnibus
Account, at Xxxxxx'x sole discretion, shall be settled by Schwab and Fund
Company either outside of the NSCC's money settlement process or through the
NSCC's money settlement process on the appropriate Settlement Date.
(iv) Any commission or concession due Schwab on a purchase Order in an
Account shall settle net with the Order. Any CDSC or short term redemption fee
under Section 7.f. due a Fund on a redemption Order in a Sub-Account shall
settle net with the order. Any CDSC or short term redemption fee under Section
7.f. due to a Fund on a redemption Order in an Omnibus Account shall be remitted
by Schwab to the Fund on no less than a monthly basis in a manner mutually
agreed upon by the parties.
c. Settlement Outside NSCC. With respect to settlement outside NSCC's money
settlement process,
(i) As to all purchase Orders for a Fund placed by Schwab on a given
trade date, whether for an Omnibus Account or for Sub-Account(s), Schwab will
transmit the purchase price to the Fund less any concessions or commissions due
Schwab, by wire transfer on the appropriate Settlement Date.
(ii) As to all redemption Orders for a Fund placed by Schwab on a
given trade date in Sub-Accounts, Fund Partyor its designee will cause the Fund
to send to Schwab the proceeds of the redemption Order less any assessed CDSCs
and/or short term redemption fees under Section 7.e, by wire transfer on the
appropriate Settlement Date. Wire transfers of redemption proceeds shall be
separate from wire transfers for other purposes.
(iii) As to all redemption Orders for a Fund placed by Schwab on a
given trade date in an Omnibus Account, Fund Company will cause each such Fund
to send to Schwab the aggregate proceeds of the redemption Order by wire
transfer on the appropriate Settlement Date. Wire transfers of redemption
proceeds shall be separate from wire transfers for other purposes. In the event
that a Fund cannot verify redemption proceeds in an Omnibus Account, Fund
Company or its designee agrees to settle trades and forward redemption proceeds
in accordance with these Operating Procedures based on information provided by
Schwab. Schwab will be responsible for the accuracy of all trade information
provided by it. Any assessed CDSCs and short term redemption fees under Section
7.f. shall be remitted by Schwab to the Fund on a no less than monthly basis in
a manner mutually agreed upon by the parties.
(iv) Each wire transfer of redemption proceeds shall indicate, on the
Fed Funds wire system, the amount thereof attributable to each Fund; provided,
however, that if the number of entries would be too great to be transmitted
through the Fed Funds wire system, Fund Company or its designee shall, on the
day the wire is sent, notify Schwab of such entries. The cost of the wire
transfer is the responsibility of the party sending the wire.
(v) The cost of the wire transfer is the responsibility of the party
sending the wire. The interest cost associated with any delayed wire is the
responsibility of the party sending the wire and will be charged at the Federal
Funds rate, or if applicable, as set forth in Section 7.e. below for Fund
Company.
d. Notification of Extended Settlement. Should a Fund need to extend
settlement on an aggregate trade, Fund Company must notify Schwab by 7:00 p.m.
Eastern Time on trade date to discuss the extension. For purposes of determining
the length of settlement on an aggregate trade, Fund Company agrees to treat
shareholders that hold Fund shares through the Account the same as it treats all
other shareholders, including those that hold Fund shares directly with the Fund
and those that hold indirectly through another financial intermediary. Each
party shall be responsible for the interest cost associated with such party's
failure to settle trades in a timely fashion, which interest will be charged at
the Federal Funds rate or, if applicable, as set forth in Section 7.e. below for
Fund Company.
e. Interest on Late Settlement. If Fund Company does not settle redemption
orders on Settlement Date and has not contacted Schwab by 7:00 p.m. Eastern Time
on trade date to discuss such extension of settlement (even if such extension is
due to a systems problem unknown on trade date), then Schwab may, at its option,
take any or all of the actions set forth below.
(i) Charge interest on the amount of the redemption proceeds due to
it, as follows:
(1) For the first day, (A) Schwab may charge Fund Company
interest at the Federal Funds "offered" rate for such day as published in The
Wall Street Journal if the amount does not exceed $1 million, or (B) Schwab may
charge Fund Company interest at the Prime Rate for such day as published in The
Wall Street Journal if the amount exceeds $1 million; and
(2) For each day following the first day, Schwab may charge Fund
Company interest at the Prime Rate for each such day as published in The Wall
Street Journal, plus 2% per annum; and
(ii) Upon notice to Fund Company, on any subsequent Settlement Date
and for so long as such redemption proceeds are due to it:
(1) Schwab may settle purchase orders and redemption orders net
of each other for such Fund; and/or
(2) Schwab may net any redemption proceeds still due to it
against any net or gross purchase amount due from Schwab to such Fund.
f. Short-Term Redemption Fees.
(i) For each Fund that imposes a short term redemption fee, Fund
Company shall complete and execute a form provided by Schwab, and as may be
revised by Schwab from time to time, which shall instruct Schwab in the
operational requirements, consistent with Xxxxxx'x operational capabilities, for
imposing such fee ("Redemption Fee Instruction Form"), (A) prior to the
Effective Date for such Fund, and (B) at least forty-five (45) Business Days
prior to any new short term redemption fee or any change in an existing short
term redemption fee. Fund Company acknowledges and agrees that Schwab may rely
on the last executed Redemption Fee Instruction Form for any Fund until at least
forty-five (45) Business Days after Fund Company has completed and executed a
new Redemption Fee Instruction Form.
(ii) Schwab agrees to impose on MFMP investors any short term
redemption fee for which Fund Company has provided a Redemption Fee Instruction
Form pursuant to Section 7.f.(i) above.
(iii) In the event that Fund Company cannot agree to the terms and
conditions set forth in the Redemption Fee Instruction Form as to a new or
changed redemption fee pursuant to Section 7.f.(i)(B) above due to operational
incompatibility or any other reason, then coincident with such new or changed
redemption fee, Schwab will take either one of the following actions in its sole
discretion: (A) suspend purchases of shares of such Fund until such time as Fund
Company can agree to the terms and conditions set forth in the Redemption Fee
Instruction Form, or (B) terminate this Agreement as to such Fund.
8. Distributions and Dividends.
a. Information Required by Schwab. For each Account, Fund Parties shall
provide all Fund distribution and dividend information as follows: (i) the
record date, ex-dividend date, and payable date with respect to the Fund as soon
as practicable after it is announced, but no later than three (3) Business Days
prior to record date, (ii) the record date share balance in the Account and the
distribution rate per share on the first Business Day after record date, (iii)
the distribution rate and distribution type by 3:00 p.m. on ex-dividend date;
and (iv) the reinvest price per share as soon as reasonably practicable after
the Fund determines its Net Asset Value, but in no event later than 7:00 p.m.
Eastern Time on the ex-dividend date (unless another time is agreed to in
writing by the parties). Other distribution information required by Schwab from
time to time for payment of distributions to its MFMP investors shall be
provided by Fund Parties on such dates as are agreed upon between Schwab and
Fund Parties, but no later than payable date.
b. Payment of Distributions and Dividends.
(i) Reinvestment Election Payment. For each Account designated by
Schwab for the payment of capital gains distributions and/or dividends in
additional shares of a Fund, Fund Company shall, on the payable date, credit to
the applicable Account the aggregate number of full and fractional shares of the
Fund reinvested as a result of such capital gains distributions and/or
dividends.
(ii) Cash Election Payment. For each Account designated by Schwab for
the payment of capital gains distributions and/or dividends in cash, Fund
Company shall, if the Account is processed through NSCC, at Xxxxxx'x sole
discretion, follow the method of settlement set forth in either 7.b.(ii)(1) or
7.b.(ii)(2) below, and shall, if the Account is processed outside of NSCC,
follow the method of settlement set forth in 7.b.(ii)(2) below.
(1) Fund Company shall pay to Schwab through the NSCC's money
settlement process, by no later than the second Business Day following receipt
of the reinvest price per share ("R+2"), the full amount of such capital gains
distributions and/or dividends.
(2) Fund Company shall wire to the designated Schwab bank account
the full amount of such capital gains distributions and/or dividends on the
first Business Day following the reinvest price per share ("R+1").
(iii) Cash Election Payment from Omnibus Reinvestment Account. For
each Omnibus Account designated by Schwab for the payment of capital gains
distributions and/or dividends in additional shares of a Fund, for purposes of
effecting cash distributions and cash dividends through such Omnibus Account for
MFMP investors who have elected through Schwab to receive their capital gains
distributions and/or dividends in cash, prior to 10:00 a.m., Eastern Time, on
R+1, Schwab shall give notification to Fund Company in a manner agreed to by the
parties of the aggregate number of Fund shares which resulted from reinvestment
of distributions or dividends for MFMP investors who had elected to receive
distributions in cash. Fund Company shall make an adjusting reconciling
transaction to void the purchase of such number of shares at the reinvest price
per share. Schwab shall use the proceeds from such adjusting reconciling
transaction to pay the distribution or dividend in cash to MFMP investors who
have elected to receive such distributions or dividends in cash. For each
Omnibus Account processed through NSCC, settlement of such adjusting reconciling
transaction shall be by either the method set forth in 7.b.(iii)(1) or the
method set forth in 7.b.(iii)(2), at Xxxxxx'x sole discretion. For Omnibus
Accounts processed outside of NSCC, settlement shall be by the method set forth
in 7.b.(iii)(2):
(1) If Schwab submits such adjusting reconciling transaction
through NSCC on R+1, Fund Company or Fund shall pay the proceeds from such
adjusting reconciling transaction no later than the next Business Day (R+2)
(2) If Schwab submits such adjusting reconciling transaction on
R+1 by means other than through Fund/SERV, Fund Company or Fund shall wire the
proceeds resulting from such adjusting reconciling transaction to the designated
Schwab bank account on R+1.
c. Interest on Late Settlement of Distributions. If Fund Company has not
paid to Schwab the cash proceeds of the adjusting reconciling transaction as
required in a reinvest Omnibus Account under Section 8.b.(iii) or has not paid
to Schwab the cash proceeds as required in a cash Account under Section
8.b.(ii), either through the NSCC's money settlement process on R+2 or, for
Accounts processed outside of the NSCC, by wire transfer on R+1 (each a "Due
Date"), then Fund or its shall pay interest on the amount of any cash proceeds
outstanding on or after the Due Date at the Federal Funds rate.
9. Daily Dividend Funds. For each Fund that pays daily dividends, Schwab shall
accrue dividends commencing on purchase settlement date and terminating on
redemption trade date for any shares held in an Omnibus Account or, in the
alternative, shall use a method of accrual mutually agreed upon by the parties.
For each such Fund, whether shares are held in an Omnibus Account or
Sub-Accounts, Fund Company shall provide to Schwab on a daily basis the
following record date information via the NSCC's Mutual Fund Profile Service,
Networking, or other mutually agreed upon means: daily rate, cumulative daily
rate for the period, account share balance, account accrual dividend amount (for
that day), weekend and holiday accrual methodology, account accrual dividend
amount (for period to date), and account transfers and period-to-date accrual
amounts.
10. Transfer of Accounts.
a. ACATS-Fund/SERV Service. The parties agree to participate in the NSCC's
Automated Customer Account Transfer Services ("ACATS")-Fund/SERV service. Fund
Company shall process transfers between accounts held by other street name
brokers or banks and the Account for a Fund through NSCC's ACATS-Fund/SERV
service immediately upon receipt of instructions from Schwab.
b. Non-ACATS-Fund/SERV Transfers. For the purpose of expediting transfers
that must be processed outside of NSCC's ACAT-Fund/SERV service, Fund Company
agrees to transfer shares between accounts held directly with the Fund or by
other street name brokers and the Account for a Fund by (i) accepting change of
dealer maintenance or transaction instruction through Networking, or (ii) if
Networking is not available, by accepting by facsimile transmission a summary
sheet of information indicating the customers' names, account numbers, the Fund
affected, and the number of shares to be re-registered or liquidated ("Summary
Sheet").
c. Signature Guarantee. Schwab represents and warrants that for each
transfer and liquidation transfer it initiates pursuant to Sections 10.a. and
10.b. above, it or the intermediary for which it clears transactions holds each
underlying instruction for re-registration or liquidation signed by its
customer, and that its customer's signature on such instruction is signature
guaranteed by Schwab or the intermediary for which Schwab clears transactions,
as applicable, pursuant to the Securities Transfer Agents Medallion Program
("STAMP"). Schwab, or, if applicable, the underlying intermediary, will retain
these documents for the period required by any applicable law, rule, or
regulation.
d. Indemnification. Schwab agrees to indemnify and hold harmless Fund
Company, the Fund, and each director, officer, employee and agent of Fund
Company ("Indemnified Person") from and against any and all Losses incurred by
any of them arising out of the impropriety of any transfer or liquidation
transfer initiated by it and effected by the Fund at Xxxxxx'x instruction in
reliance on Section 10.c. to the same extent as provided under STAMP, except to
the extent such Losses arise out of the failure of any Indemnified Person to
comply with the instructions provided by Schwab as set forth in Sections 10.a.
and b. above.
e. Settlement of Liquidation Transfers. Fund Company agrees to settle
proceeds resulting from liquidation transfers with Schwab as set forth in
Section 7 of these Operating Procedures.
f. No Individual FBO Accounts. Fund Company shall process all transfer and
liquidation requests into the appropriate Account. At no time shall any Fund
establish any separate account registered to Schwab for the benefit of an
individual shareholder. In the event any such account is mistakenly opened,
Schwab reserves the right to instruct the Fund to move Fund shares to the
Account. Fund Company further agrees that it shall provide notification to
Schwab prior to effecting transfers of shares into the Account(s), and shall not
effect transfers of shares out of the Account(s) without Xxxxxx'x instruction,
as provided in Sections 10.a. and b. above.
g. Qualified Custodian Status. Schwab represents and warrants that it is
qualified as a custodian to accept in the Accounts shares from Fund XXX, Xxxxx,
or 401(k) accounts.
h. Confirmation of Transfers. Fund Company must confirm to Schwab the
completion of each transfer on the day it occurs. The confirming information
shall include the number of shares, date ("as of" date if unavoidable delay),
transaction date, account number of the customer and the Account, registration,
accrued dividends and account type (i.e., XXX, Xxxxx, 401(k), etc.).
i. Share Lot Histories, XXXx, and ROAs. Fund Parties agree to supply to
Schwab upon transfer of shares into an Account, and Schwab agrees to supply to
Fund Parties upon transfer out of an Account, as soon as reasonably practicable,
but in no event later than forty-five (45) days after confirmation of transfer
under 10.h. hereto, all shareholder history of specific purchases, redemptions
(including exchanges) and reinvestments for XXXX, 00x-0, or other age dependent
fees, and all letters of intent and all linkages for rights of accumulation for
such transferred shares (collectively, "Share History") in a manner mutually
agreed upon by the parties from time to time. Each of Schwab and Fund Parties
may treat the Share History received as complete after such period and, in the
case of a contingency or holding period for CDSC, 12b-1 Plan, or other age
dependent fees for which no Share History has been received, treat such
contingency period or holding period as having lapsed and act accordingly,
including, by way of example and not limitation, by converting shares of a CDSC
Fund under Section 11.e. of these Operating Procedures.
j. Trailing Dividends. Transfer processing after record date but prior to
payable date will include all accrued dividends. Each Fund is responsible for
monitoring all completed full transfers for "trailing" dividends. Should a
"trailing" dividend appear in an account, a Fund shall send such dividend to
Schwab within five (5) Business Days, along with a specific written notification
thereof. Notification shall include details of the dividend and customer,
including the customer's social security number or taxpayer identification
number, and/or the account number for the Account to which the transfer was
made.
k. Share Certificates. If MFMP investors submit share certificates for
transfer into their Schwab brokerage accounts, Schwab will send such
certificates, properly endorsed to the applicable Fund, for transfer into the
Account with such Fund. Upon Xxxxxx'x request, Fund Company agrees to provide
the status of said certificates and book share balances.
11. General.
a. Record Maintenance.
(i) Schwab maintains records (or such records are maintained by an
intermediary clearing trades through Schwab) for each MFMP investor who holds
Fund shares through an Account, which records include:
(1) Number of shares;
(2) Date, price, and amount of purchases and redemptions
(including dividend reinvestments), and date and amounts of dividends paid for
at least the current year to date;
(3) Name and address of each of its customers, including zip
codes and social security numbers or taxpayer identification numbers;
(4) Records of distributions and dividend payments;
(5) Any CDSC's applicable to the shares, and documentary
verification of the basis for any CDSC waiver;
(6) Any asset based sales charges paid on the shares;
(7) Any letters of intent and rights of accumulation with respect
to the shares;
(8) Any transfers of shares; and
(9) Overall control records.
(ii) Schwab posts transactions in Fund shares to its customers'
brokerage accounts.
b. Shareholder Communication.
(i) Fund Company shall arrange with Schwab, or a mailing agent
designated or approved by Schwab, for the distribution of the materials listed
below to all of Xxxxxx'x customers who hold Fund shares, which distribution
shall be so arranged by Fund Company as to occur immediately upon the effective
date of the materials:
(1) All proxy or information statements prepared for circulation
to shareholders of record of such Fund;
(2) Annual reports;
(3) Semi-annual reports;
(4) Quarterly reports (if applicable); and
(5) All updated prospectuses, supplements, and amendments
thereto.
Fund Company shall be responsible for providing the materials and for Schwab or
the mailing agent's fees in connection with this service as well as for timely
distribution. Fund Company agrees to have Schwab or the mailing agent
consolidate mailings of material to shareholders of more than one Fund if the
material to be mailed is identical for all such Funds.
(ii) In addition to the materials listed above, Fund Company agrees to
provide directly to Schwab all prospectuses, statements of additional
information and supplements and amendments thereto, and annual and other
periodic reports for each Fund in amounts reasonably requested by Schwab for
distribution to its customers. Fund Company is obligated to supply these
materials to Schwab in a timely manner so as to allow Schwab, at its own
expense, to send current prospectuses and statements of additional information
and periodic reports, immediately upon their effective dates, to customers and
prospective customers requesting them through Schwab. Schwab will also send a
current Fund prospectus with purchase trade confirmations for the initial
purchase of a Fund. Fund Company shall notify Schwab immediately of any change
to a Fund's prospectus.
(iii) If Schwab acts as clearing broker in an omnibus relationship
with a correspondent bank or broker ("Correspondent"), upon the request of
Schwab, Fund Company shall also provide to Schwab, in a timely manner,
sufficient supplies of Fund materials identified in Sections 11(b)(i) and
11(b)(ii) for Schwab to give to Correspondent for the distribution of such
materials to Correspondent's customers.
(iv) Fund Company shall ensure that the prospectus of each Fund
discloses that the purchase or sale of Fund shares through intermediaries may be
subject to transaction fees or other different or additional fees, and includes
such other disclosures as may be required by applicable laws, rules and
regulations. Fund Company shall also ensure that either the prospectus, or the
statement of additional information ("SAI") if the SAI is incorporated in the
prospectus, of each of its Funds discloses that:
(1) the Fund has authorized one or more brokers to receive on its
behalf purchase and redemption Orders;
(2) such brokers are authorized to designate other intermediaries
to receive purchase and redemption Orders on the Fund's behalf;
(3) the Fund will be deemed to have received a purchase or
redemption Order when an authorized broker or, if applicable, a broker's
authorized designee, receives the Order; and
(4) customer Orders will be priced at the Fund's Net Asset Value
next computed after they are received by an authorized broker or the broker's
authorized designee and accepted by the Fund.
(v) Schwab mails statements to its customers on a monthly basis (or as
to accounts in which there has been no activity in a particular month, no less
frequently than quarterly) showing, among other things, the number of shares of
each Fund owned by such customer and the net asset value of each such Fund as of
a recent date.
(vi) Schwab responds to customer inquiries regarding, among other
things, share prices, account balances, dividend amounts and dividend payment
dates. With respect to Fund shares purchased by customers, Schwab provides
average cost basis reporting to assist customers in the preparation of income
tax returns.
c. Dividend and Distribution Reporting.
(i) For annual tax reporting purposes, Fund Company shall inform
Schwab by January 15 of the portion of each Fund's distributions that are
taxable for the previous calendar year that include dividends, capital gains,
and tax reclassifications; and by February 15, the portion of each Fund's
distributions for the previous calendar year that include qualifying dividend
income, foreign source income, tax exempt income by state of origin or return of
capital, U.S. government obligation interest, creditable and non-creditable
foreign tax, dividends eligible for the corporate dividends received deductions,
and redemption proceeds. In addition, Fund Company is responsible for
identifying and informing Schwab concerning any portion of any dividends and
other distributions and payments attributable to any Fund gains or portfolio
interest earned after the close of the Fund Company's tax year that is not
subject to tax withholding if paid to non-United States persons.
(ii) In conformance with its status as a broker/dealer holding its
customers securities in street name, Schwab shall prepare and file with the
appropriate governmental agencies, such information, returns, and reports as are
required to be so filed under applicable federal or state law, rule, or
regulation to report (i) dividends and other distributions made, (ii) amounts
withheld on dividends and other distributions and payments, and (iii) gross
proceeds of sales transactions.
d. Reorganization Activities.
(i) Fund Closure Notification. If a Fund will be closed to new or
subsequent purchases by shareholders ("Fund Closure"), Fund Company must notify
Schwab as soon as practicable and shall use commercially reasonable efforts to
complete and return a form closure notice provided by Schwab ("Fund Closure
Form") at least (2) Business Days prior to the Fund Closure. If Fund Company
fails to notify Schwab of a Fund Closure or return the Fund Closure Form
pursuant to this Section, Fund Company agrees that such Fund will continue to
accept those purchase Orders which Schwab received from MFMP investors prior to
notification of the Fund Closure for a period of up to five (5) Business Days
after the effective date of the Fund Closure. If a Fund is closed to business
(both purchase and redemption) on any Business Day or any portion of a Business
Day due to state or local holiday, inclement weather, operational problems, or
any other reason, then Fund Company shall ensure that Schwab is notified in
writing prior to or immediately upon such closure and shall work with Schwab to
process any Orders taken by Schwab from MFMP investors during any period during
which the Fund was closed but Schwab did not have notification of such closure.
(ii) Mergers, Splits and other Reorganization Activities. Upon notice
from Fund Company as set forth in this Section 11.d(ii), Schwab shall effect
mergers, splits, reverse splits, and other corporate actions and reorganization
activities (except with respect to Fund Closure under paragraph (i) above) of a
Fund for its customers (each a "Fund Event"). The notice must state the record
date and type of Fund Event, and must be received by Schwab at least seven
Business Days prior to the record date of the Fund Event. By 6:00 p.m. Eastern
Time on the effective date of such Fund Event, Fund Company shall provide all
relevant information related to the Fund Event, including, for example and as
applicable, factors, field inputs, the ratio of a split, and factor of merged
shares.
e. Share Lot Conversion. As to any share lot of a CDSC Fund held in an
Account for which the contingency period has lapsed, the parties agree to
cooperate to convert such shares into shares of another Fund of the multi-class,
as applicable based on information provided under this Agreement by Fund Company
on Exhibit B and/or MFPS for such conversions.
f. Price, Distribution Rate and Other Fund Errors.
(i) In the event adjustments are required to correct any error in the
computation of the Net Asset Value or public offering price of a Fund's shares,
in the distribution rate for a Fund's shares, or otherwise, Fund Company shall
notify Schwab upon discovering the need for such adjustment. Notification may be
made orally, but must be confirmed in writing.
(ii) With respect to any Sub-Account, Fund Company shall notify Schwab
upon resolution of the error. With respect to any Omnibus Account, Schwab and
Fund Company shall agree promptly and in good faith to a resolution of the
error, and no adjustment for the error shall be taken in the Omnibus Account
until such agreement is reached. Following resolution of an error in any
Account, upon request by Schwab, Fund Company shall provide Schwab with written
notification of the resolution. The letter shall be written on Fund Company
letterhead and shall state for each day on which an error occurred the incorrect
price or rate, the correct price or rate, and the reason for the price or rate
change. Fund Company agrees that Schwab may send this writing, or derivation
thereof, to MFMP investors whose accounts are affected by the price or rate
change.
(iii) If an MFMP investor has received cash in excess of what he or
she is entitled, Schwab will, when requested by Fund Company, and to the extent
practicable and permitted by law, debit the MFMP investor's brokerage account in
the amount of such excess, but only to the extent of any cash in the account,
and repay it to the Fund. In no event, however, shall Schwab be liable to Fund
Company or the Fund for any such amounts, unless the error was caused by
Xxxxxx'x breach of this Agreement or its willful misconduct or negligence in the
performance of, or failure to perform, its obligations under this Agreement.
Upon the request of Fund Company, Schwab shall provide Fund Company with the
name of the MFMP investor and other relevant information concerning the MFMP
investor's brokerage account to assist Fund Company in the collection from
Xxxxxx'x customer of any such excess amount not repaid to the Fund.
(iv) If an adjustment is necessary to correct an error which has
caused MFMP investors to receive dollars or shares less than that to which they
are entitled, the Fund shall, as appropriate for Sub-Accounts and as mutually
agreed by the parties for Omnibus Accounts pursuant to Section 11.f.(ii) above,
make all necessary adjustments to the number of shares owned in the Account
and/or distribute to Schwab any and all amounts of the underpayment. Schwab will
credit the appropriate amount of such shares or payment to each MFMP investor.
(v) For purposes of making adjustments, including the collection of
overpayments, Fund Company agrees to treat shareholders that hold Fund shares
through an Omnibus Account the same as it treats all other shareholders,
including those that hold Fund shares directly with the Fund and those that hold
indirectly through another financial intermediary. When making adjustments for
an error, a Fund shall not net transactions for that day in an Account.
g. Breakpoint Eligibility Xxxxxxxxxxx.Xx the event that Schwab notifies
Fund Company of a failure of conditions on a breakpoint Discount given an MFMP
investor on a purchase Order in a Sub-Account, Fund Parties agree to work with
Schwab to correct such Sub-Account, recover the applicable sales charge from
such MFMP investor for the Fund, and pay to Schwab the broker's concession due
from it.
h. Redemptions in Kind. Fund Company represents that if a Fund has reserved
the right to redeem in kind, that Fund will not redeem in kind any shares held
in the Accounts unless it notifies Schwab of its intent to redeem in kind prior
to by 7:00 p.m. Eastern Time on trade date. Fund Company will use best efforts
to ensure that the proceeds of any redemption in kind will include only easily
marketable securities. Fund Company will work in good faith with Schwab and,
upon Xxxxxx'x request, directly with the MFMP investor to effect the redemption
in kind in an efficient manner, including with respect to coordinating the
delivery of the in kind securities. For purposes of any redemption in kind, Fund
Company agrees that it will treat as a "shareholder" each shareholder that holds
Fund shares through an Account, provided that Schwab provides to Fund Company,
upon request, the name or account number, number of Fund shares and other
relevant information for each such shareholder.
i. Suspension of Purchases. Upon notice to Fund Company, Schwab may suspend
purchases by any or all segments of MFMP investors of any or all classes of Fund
shares made available through the MFMP for any period of time.
j. New Processing Systems. Fund Company agrees to cooperate to the extent
possible with Schwab as Schwab develops and seeks to implement new processing
systems for the MFMP.
ADDENDUM TO LOAD FUND OPERATING AGREEMENT
This Addendum to the Load Fund Operating Agreement (this "Addendum") is
made as of February 13, 2008, by and between AllianceBernstein Investments, Inc.
("Distributor"); the principal underwriter for certain registered investment
companies for which Distributor serves as principal underwriter now or hereafter
(the "Funds"); and Xxxxxxx Xxxxxx & Co., Inc. ("Schwab"), a California
corporation. Unless otherwise indicated, all capitalized terms herein will have
the same respective meaning as set forth in the Load Fund Operating Agreement.
WHEREAS, Fund Parties are parties to the Load Fund Operating Agreement
dated as of June 1, 2007, as amended (the "Agreement"), and this Addendum amends
and supplements the Agreement; and
WHEREAS, pursuant to the terms and conditions of the Agreement, Fund shares
are made available to investors for purchase and redemption through Xxxxxx'x
Mutual Fund Marketplace(R); and
WHEREAS, Schwab may from time to time be designated as broker or dealer of
record for one or more accounts ("Plan Direct Accounts") established directly
with Funds by certain retirement and deferred compensation plans, and trusts
used to fund those plans, including but not limited to 401(k) and other
qualified plans ("Plans"), through which the Plans or their agents effect
purchases, redemptions and other plan participant transactions; and
WHEREAS, Schwab may receive certain compensation from the Funds in its
capacity as broker or dealer of record for the Plan Direct Accounts; and
WHEREAS, subject to the terms and conditions of this Addendum, Fund Parties
desire to amend and supplement the Agreement regarding Plan Direct Accounts;
NOW THEREFORE, in consideration of the foregoing and the mutual promises
set forth below, the parties hereto agree to amend the Agreement as follows:
1. Plan Direct Accounts. Schwab may act as broker or dealer of record on
Plan Direct Accounts holding the series or classes of shares of the Funds ("Plan
Funds"). The parties acknowledge and understand that Plan Direct Accounts are
not maintained on Xxxxxx'x mutual fund trading systems and therefore shall not
be Accounts subject to the Operating Procedures under the Agreement. Through the
Plan Direct Accounts, only Plans or their agents (and not Schwab) effect
purchases, redemptions and other plan participant transactions in Plan Fund
shares in accordance with the Fund account agreement and/or other agreement and
procedures agreed upon by the Fund and the Plan or its agents and applicable to
such Plan Direct Accounts.
2. Payments. In consideration of the services Schwab provides to the Plan
in Xxxxxx'x capacity as broker or dealer of record, Distributor shall pay to
Schwab the usual and customary commissions or concessions and/or fees pursuant
to a plan of distribution and/or shareholder servicing adopted under the 1940
Act ("Plan Account Fees") that are payable to any broker or dealer of record for
accounts maintained with the Fund. All Plan Account Fees shall be paid at such
rates and in such manner as may be described in the Fund's then-current
prospectus or other offering documents. Distributor understands and agrees that
Schwab may pay all or a portion of the Plan Account Fees it receives in
connection with Plan Fund shares purchased by the Plan or its agents and
maintained in Plan Direct Accounts to an unaffiliated broker-dealer for
providing advice, administration, shareholder and/or other services to the
Plans. The parties acknowledge and agree that the compensation Schwab receives
in connection with Plan Fund shares under this Addendum is separate and distinct
from any compensation Schwab receives under the Agreement applicable to Fund
shares purchased and maintained by Schwab through its Mutual Fund Marketplace.
Schwab is not eligible to receive any compensation in connection with Plan Fund
shares other than as set forth in this paragraph.
3. Amendment. This Addendum may be amended only by a writing executed by
each party hereto that is to be bound by such amendment.
4. Termination. This Addendum may be terminated as to any Plan Fund by
either party immediately upon written notice to the other party.
5. Counterparts. This Addendum may be executed in two or more counterparts,
each of which will be deemed an original, but all of which together shall
constitute one and the same instrument.
6. Headings. The headings of the sections or other subdivisions of this
Addendum are for convenience of reference only and shall not affect the meaning,
construction, operation or effect of the terms hereof or otherwise be considered
in the interpretation of this Addendum.
7. Effect of This Addendum. This Addendum is intended to amend and
supplement the provisions of the Agreement. This Addendum is only applicable to
Plan Fund shares held in Plan Direct Accounts. In the event of a conflict
between the provisions of this Addendum and the provisions of the Agreement, the
provisions of this Addendum shall control. All other provisions of the Agreement
shall remain in full force and effect.
IN WITNESS WHEREOF, this Addendum has been executed by a duly authorized
representative of the parties.
XXXXXXX XXXXXX & CO., INC.
By: /S/ Xxxx Xxxxx
---------------
Xxxx Xxxxx
Senior Vice President
Schwab Financial Products Operations
Date: 0-0-00
XXXXXXXXXXXXXXXXX XXXXXXXXXXX, INC.
By: /S/ Xxxxxx X. Xxxxx
--------------------
Name: Xxxxxx X. Xxxxx
Title: Assistant Secretary
Date: 2/20/08
