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Exhibit 9(a)
TRANSFER AGENCY AGREEMENT
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This Agreement is made as of January 22, 1997 between The Cardinal
Group (the "Group"), an Ohio business trust having its principal place
of business at 000 Xxxx Xxxxx Xxxxxx, Xxxxxxxx, Xxxx 00000, and Cardinal
Management Corp. ("Cardinal"), an Ohio corporation having its principal place of
business at 000 Xxxx Xxxxxxx Xxxxxx, Xxxxxxxx, Xxxx 00000.
WHEREAS, the Group desires that Cardinal perform certain services for
the Group, and for each of its series denominated as funds identified in
Schedule A hereto, as such Schedule shall be amended from time to time
(individually referred to herein as a "Fund" and collectively as the "Funds");
and
WHEREAS, Cardinal is willing to perform such services on the
terms and conditions set forth in this Agreement;
NOW, THEREFORE, in consideration of the mutual premises and covenants
herein set forth, the parties agree as follows:
SECTION 1. TRANSFER AGENT SERVICES. Cardinal shall perform for the
Group the transfer agent services set forth in Schedule B hereto, including
services as transfer agent.
Cardinal also agrees to perform for the Group such special
services incidental to the performance of the services enumerated in this
Section 1 as agreed to by the parties from time to time. Cardinal shall perform
such additional services as are provided on an amendment to Schedule B hereof,
in consideration of such fees as the parties hereto may agree.
Cardinal may, in its discretion, appoint in writing other
parties qualified to perform transfer agency and shareholder services reasonably
acceptable to the Group (individually, a "Sub-transfer Agent") to carry out
some or all of its responsibilities under this Agreement with respect to a Fund;
provided, however, that the Sub-transfer Agent shall be the agent of Cardinal
and not the agent of the Group or such Fund, and that Cardinal shall be fully
responsible for the acts of such Sub-transfer Agent and shall not be relieved of
any of its responsibilities hereunder by the appointment of such Sub-transfer
Agent.
SECTION 2. FEES. The Group shall pay Cardinal for the services to be
provided by Cardinal under this Agreement in accordance with, and in the manner
set forth, in Schedule C hereto. Fees for any additional services to be provided
by Cardinal pursuant to an amendment to Schedule C hereto shall be subject to
mutual agreement at the time such amendment to Schedule C is proposed.
SECTION 3. REIMBURSEMENT OF EXPENSES. In addition to paying Cardinal
the fees described in Section 2 hereof, the Group agrees to reimburse Cardinal
for Cardinal's out-of-pocket expenses in
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providing services hereunder, including without limitation the following:
(a) All freight and other delivery and bonding charges incurred by
Cardinal in delivering materials to and from the Group and in
delivering all materials to shareholders;
(b) All direct telephone, telephone transmission and telecopy or
other electronic transmission expenses incurred by Cardinal in
communication with the Group, a Fund's investment adviser or
custodian, dealers, shareholders or others as required for
Cardinal to perform the services to be provided hereunder;
(c) Costs of postage, couriers, stock computer paper, statements,
labels, envelopes, checks, reports, letters, tax forms,
proxies, notices or other form of printed material which shall
be required by Cardinal for the performance of the services to
be provided hereunder;
(d) The cost of microfilm or microfiche of records or other
materials; and
(e) Any expenses Cardinal shall incur at the written direction of
a duly authorized officer of the Group.
SECTION 4. EFFECTIVE DATE. This Agreement shall become effective with
respect to a Fund as of the date first written above (or, if a particular Fund
is not in existence on that date, on the date an amendment to Schedule A to this
Agreement relating to that Fund is executed) (the "Effective Date").
SECTION 5. TERM. This Agreement shall continue in effect, unless
earlier terminated by either party hereto as provided hereunder, until February
1, 1998, and thereafter shall be renewed automatically for successive one-year
terms unless written notice not to renew is given by the non-renewing party to
the other party at least 60 days prior to the expiration of the then-current
term; provided, however, that after such termination, for so long as Cardinal,
with the written consent of the Group, in fact continues to perform any one or
more of the services contemplated by this Agreement or any Schedule or exhibit
hereto, the provisions of this Agreement, including without limitation the
provisions dealing with indemnification, shall continue in full force and
effect. Fees and out-of-pocket expenses incurred by Cardinal but unpaid by the
Group upon such termination shall be immediately due and payable upon and
notwithstanding such termination. Subsequent to such termination, Cardinal shall
return to Group documents or records remaining in its possession. Further, this
Agreement is terminable with respect to a particular Fund only upon mutual
agreement of the parties hereto or for "cause" (as defined below) by the party
alleging
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"cause," in either case on not less than 60 days' notice by the Group's Board of
Trustees or by Cardinal.
For purposes of this Agreement, "cause" shall mean (a) willful
misfeasance, bad faith, gross negligence, or reckless disregard on the part of
the party to be terminated with respect to its obligations and duties set forth
herein; (b) a final, unappealable judicial, regulatory or administrative ruling
or order in which the party to be terminated has been found guilty of criminal
or unethical behavior in the conduct of its business; (c) financial difficulties
on the part of the party to be terminated which are evidenced by the
authorization or commencement of, or involvement by way of pleading, answer,
consent, or acquiescence in, a voluntary or involuntary case under Title 11 of
the United States Code, as from time to time is in effect, or any applicable
law, other than said Title 11, of any jurisdiction relating to the liquidation
or reorganization of debtors or to the modification or alteration of the rights
of creditors; or (d) any circumstance which substantially impairs the
performance of the obligations and duties as contemplated herein of the party to
be terminated.
SECTION 6. UNCONTROLLABLE EVENTS. Cardinal assumes no responsibility
hereunder, and shall not be liable, for any damage, loss of data, delay or any
other loss whatsoever caused by events beyond its reasonable control.
SECTION 7. LEGAL ADVICE. Cardinal shall notify the Group at any time
Cardinal believes that it is in need of the advice of counsel (other than
counsel in the regular employ of Cardinal or any affiliated companies) with
regard to Cardinal's responsibilities and duties pursuant to this Agreement; and
after so notifying the Group, Cardinal, at its discretion, shall be entitled to
seek, receive and act upon advice of legal counsel of its choosing, and shall in
no event be liable to the Group or any Fund or any shareholder or beneficial
owner of the Group for any action reasonably taken pursuant to such advice.
SECTION 8. INSTRUCTIONS. Whenever Cardinal is requested or authorized
to take action hereunder pursuant to instructions from a shareholder or a
properly authorized agent of a shareholder ("shareholder's agent") concerning an
account in a Fund, Cardinal shall be entitled to rely upon any certificate,
letter or other instrument or communication, whether in writing, by electronic
or telephone transmission, believed by Cardinal to be genuine and to have been
properly made, signed or authorized by an officer or other authorized agent of
the Group or by the shareholder or shareholder's agent, as the case may be, and
shall be entitled to receive as conclusive proof of any fact or matter required
to be ascertained by it hereunder a certificate signed by an officer of the
Group or any other person authorized by the Group's Board of Trustees or by the
shareholder or shareholder's agent, as the case may be.
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As to the services to be provided hereunder, Cardinal may rely
conclusively upon the terms of the most recent Prospectuses and Statements of
Additional Information of the Group relating to the Funds to the extent that
such services are described therein unless Cardinal receives written
instructions to the contrary in a timely manner from the Group.
SECTION 9. STANDARD OF CARE; INDEMNIFICATION. Cardinal shall use its
best efforts to ensure the accuracy of all services performed under this
Agreement, but shall not be liable to the Group for any action taken or omitted
by Cardinal in the absence of bad faith, willful misfeasance or negligence. The
Group agrees to indemnify and hold harmless Cardinal, its employees, agents,
directors, officers and nominees from and against any and all claims, demands,
actions and suits, whether groundless or otherwise, and from and against any and
all judgments, liabilities, losses, damages, costs, charges, counsel fees and
other expenses of every nature and character arising out of or in any way
relating to Cardinal's actions taken or nonactions with respect to the
performance of services under this Agreement or based, if applicable, upon
reasonable reliance on information, records, instructions or requests given or
made to Cardinal by the Group, the investment adviser and on any records
provided by any custodian thereof; provided that this indemnification shall not
apply to actions or omissions of Cardinal in cases of its own willful
misfeasance or negligence, and further provided that prior to confessing any
claim against it which may be the subject of this indemnification, Cardinal
shall give the Group written notice of and reasonable opportunity to defend
against such claim in its own name or in the name of Cardinal.
SECTION 10. RECORD RETENTION AND CONFIDENTIALITY. Cardinal shall keep
and maintain on behalf of the Group all books and records which the Group or
Cardinal is, or may be, required to keep and maintain pursuant to any applicable
statutes, rules and regulations, including without limitation Rules 31a-1 and
31a-2 under the 1940 Act relating to the maintenance of books and records in
connection with the services to be provided hereunder. Cardinal further agrees
that all such books and records shall be the property of the Group and to make
such records available for inspection by the Group or by the Securities and
Exchange Commission at reasonable times and otherwise to keep confidential all
books and records and other information relative to the Group and its
shareholders, except when requested to divulge such information by
duly-constituted authorities or court process, or requested by a shareholder
with respect to information concerning an account as to which such shareholder
has either a legal or beneficial interest or when requested by the Group, the
shareholder, or the dealer of record as to such account.
SECTION 11. REPORTS. Cardinal will furnish to the Group and to its
properly authorized auditors, investment advisers, examiners,
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distributors, dealers, underwriters, salesmen, insurance companies and others
designated by the Group in writing, such reports at such times as are prescribed
in Schedule D attached hereto, or as subsequently agreed upon by the parties
pursuant to an amendment to Schedule D. The Group agrees to examine each such
report or copy promptly and will report or cause to be reported any errors or
discrepancies therein no later than three business days from the receipt
thereof. In the event that errors or discrepancies, except such errors and
discrepancies as may not reasonably be expected to be discovered by the
recipient within three days after conducting a diligent examination, are not so
reported within the aforesaid period of time, a report will for all purposes be
accepted by and binding upon the Group and any other recipient, and Cardinal
shall have no liability for errors or discrepancies therein and shall have no
further responsibility with respect to such report except to perform reasonable
corrections of such errors and discrepancies within a reasonable time after
requested to do so by the Group.
SECTION 12. RETURN OF RECORDS. Cardinal may at its option at any time,
and shall promptly upon the Group's demand, turn over to the Group and cease to
retain Cardinal's files, records and documents created and maintained by
Cardinal pursuant to this Agreement which are no longer needed by Cardinal in
the performance of its services or for its legal protection. If not so turned
over to the Group, such documents and records will be retained by Cardinal for
six years from the year of creation. At the end of such six-year period, such
records and documents will be turned over to the Group unless the Group
authorizes in writing the destruction of such records and documents.
SECTION 13. REPRESENTATIONS OF CARDINAL. Cardinal represents and
warrants that: (a) Cardinal has been in, and shall continue to be in,
substantial compliance with all provisions of law, including Section 17A(c) of
the Securities Exchange Act of 1934, as amended, required in connection with the
performance of its duties under this Agreement; and (b) the various procedures
and systems which Cardinal has implemented with regard to safeguarding from loss
or damage attributable to fire, theft, or any other cause of the records and
other data of the Group and Cardinal's records, data, equipment facilities and
other property used in the performance of its obligations hereunder are adequate
and that it will make such changes therein from time to time as are required for
the secure performance of its obligations hereunder.
SECTION 14. INSURANCE. Cardinal shall notify the Group should its
insurance coverage with respect to professional liability or errors and
omissions coverage be changed for any reason. Such notification shall include
the date of change and the reasons therefor. Cardinal shall notify the Group of
any material claims against it with respect to services performed under this
Agreement, whether or not they may be covered by insurance, and shall notify
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the Group from time to time as may be appropriate of the total outstanding
claims made by Cardinal under its insurance coverage.
SECTION 15. INFORMATION FURNISHED BY CARDINAL. Cardinal has furnished
to the Group the following:
(a) Cardinal's Articles of Incorporation.
(b) Cardinal's Code of Regulations and any amendments thereto.
(c) Certified copies of actions of Cardinal covering the following
matters:
1. Approval of this Agreement, and authorization of a
specified officer of Cardinal to execute and
deliver this Agreement;
2. Authorization of Cardinal to act as transfer agent
for the Funds.
(d) A copy of the most recent independent accountants' report
relating to internal accounting control systems as filed with
the Securities and Exchange Commission pursuant to Rule
17Ad-13 of the Securities Exchange Act of 1934, as amended.
SECTION 16. COMPLIANCE WITH LAW. Except for the obligations of Cardinal
set forth in Section 10 hereof, the Group assumes full responsibility for the
preparation, contents and distribution of each prospectus of the Group as to
compliance with all applicable requirements of the Securities Act of 1933, as
amended, the 1940 Act and any other laws, rules and regulations of governmental
authorities having jurisdiction.
SECTION 17. NOTICES. Any notice provided hereunder shall be
sufficiently given when sent by registered or certified mail to the party
required to be served with such notice, at that party's address set forth at the
beginning of this Agreement, or at such other address as such party may from
time to time specify in writing to the other party pursuant to this Section.
SECTION 18. HEADINGS. Paragraph headings in this Agreement are included
for convenience only and are not to be used to construe or interpret this
Agreement.
SECTION 19. ASSIGNMENT. This Agreement and the rights and duties
hereunder shall not be assignable by either of the parties hereto except by the
specific written consent of the other party. This SECTION 19 shall not limit or
in any way affect Cardinal's right to appoint a Sub-transfer Agent pursuant to
Section 1 hereof.
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SECTION 20. GOVERNING LAW. This Agreement shall be governed by and
provisions shall be construed in accordance with the laws of the State of Ohio.
SECTION 21. LIMITATION OF LIABILITY OF THE TRUSTEES AND SHAREHOLDERS.
The Group is a business trust organized under Chapter 1746, Ohio Revised Code
and under a Declaration of Trust, to which reference is hereby made and a copy
of which is on file at the Office of the Secretary of State of Ohio as required
by law, and to any and all amendments thereto so filed or hereafter filed. The
obligations of "The Cardinal Group" entered into in the name or on behalf
thereof by any of the Trustees, officers, employees or agents are made not
individually, but in such capacities, and are not binding upon any of the
Trustees, officers, employees, agents or shareholders of the Group personally,
but bind only the assets of the Group, as set forth in Section 1746.13(A), Ohio
Revised Code, and all persons dealing with any of the Funds of the Group must
look solely to the assets of the Group belonging to such Fund for the
enforcement of any claims against the Group.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed all as of the day and year first above written.
THE CARDINAL GROUP
By /s/ Xxxxx X. Xxxxxx
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Xxxxx X. Xxxxxx, President
CARDINAL MANAGEMENT CORP.
By /s/ H. Xxxxx Xxxxx
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H. Xxxxx Xxxxx, President
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January , 1997
SCHEDULE A
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to the Transfer Agency
between The Cardinal Group
and Cardinal Management Corp.
Name of Fund Date
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Cardinal Balanced Fund January __, 1997
Cardinal Aggressive Growth Fund January __, 1997
The Cardinal Fund January __, 1997
Cardinal Government Obligations Fund January __, 1997
Cardinal Government Securities Money January __, 1997
Market Fund
Cardinal Tax Exempt Money Market Fund January __, 1997
THE CARDINAL GROUP
By /s/ Xxxxx X. Xxxxxx
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Xxxxx X. Xxxxxx, President
CARDINAL MANAGEMENT CORP.
By /s/ H. Xxxxx Xxxxx
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H. Xxxxx Xxxxx, President
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SCHEDULE B
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TRANSFER AGENCY SERVICES
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1. SHAREHOLDER TRANSACTIONS
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a. Process shareholder purchase and redemption orders.
b. Set up account information, including address, dividend option,
taxpayer identifications number and wire instructions.
c. Issue confirmation for every transaction.
d. Issue periodic statements for shareholders.
e. Process transfers and exchanges.
f. Process dividend payments, including the purchasing of new shares
through dividend reinvestment.
2. SHAREHOLDER INFORMATION SERVICES
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a. Make information available to shareholder servicing unit and other
remote access units regarding trade date, share price, current
holdings, yields, and dividend information.
b. Produce detail history of transactions through duplicate or special
order statements upon request.
c. Provide mailing labels for distribution of financial reports,
prospectuses, proxy statements, or marketing material to current
shareholders.
3. COMPLIANCE REPORTING
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a. Provide reports to the Securities and Exchange Commission, the NASD
and the States in which the Fund is registered.
b. Prepare and distribute appropriate Internal Revenue Service forms
for corresponding Fund and shareholder income and capital gains.
c. Issue tax withholding reports to the Internal Revenue Service.
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4. DEALER/LOAD PROCESSING (IF APPLICABLE)
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a. Provide reports for tracking rights of accumulation and purchases
made under a Letter of Intent.
b. Account for separation of shareholder investments from transaction
sale charges for purchases of Fund shares.
c. Calculate fees due under 12b-1 plans for distribution and marketing
expenses.
d. Track sales and commission statistics by dealer and provide for
payment of commissions on direct shareholder purchases in a load
Fund.
5. SHAREHOLDER ACCOUNT MAINTENANCE
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a. Maintain all shareholder records for each account in the Group.
b. Issue customer statements on scheduled cycle, providing duplicate
second and third party copies if required.
c. Record shareholder account information changes.
d. Maintain account documentation files for each shareholder.
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Date: January 22, 1997
SCHEDULE C
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FEES
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TRANSFER AGENT AND DIVIDEND
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DISBURSING AGENT
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ANNUAL FEES PER FUND:
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$18.00 per account annually (payable monthly) for The Cardinal
Fund, Cardinal Balanced Fund and Cardinal Aggressive Growth Fund
$21.00 per account annually (payable monthly) for Cardinal
Government Obligations Fund, Cardinal Government Securities Money
Market Fund and Cardinal Tax Exempt Money Market Fund
THE CARDINAL GROUP
By /s/ Xxxxx X. Xxxxxx
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Xxxxx X. Xxxxxx, President
CARDINAL MANAGEMENT CORP.
By /s/ H. Xxxxx Xxxxx
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H. Xxxxx Xxxxx, President
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Date: January 22, 1997
SCHEDULE D
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REPORTS
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I. Daily Shareholder Activity Journal
II. Daily Fund Activity Summary Report
A. Beginning Balance
B. Dealer Transactions
C. Shareholder Transactions
D. Reinvested Dividends
E. Exchanges
F. Adjustments
G. Ending Balance
III. Daily Wire and Check Registers
IV. Monthly Dealer Processing Reports
V. Monthly Dividend Reports
VI. Sales Data Reports for Blue Sky Registration
VII. Annual report by independent public accountants concerning Cardinal's
shareholder system and internal accounting control systems to be filed
with the Securities and Exchange Commission pursuant to Rule 17Ad-13 of
the Securities Exchange Act of 1934, as amended.
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