Exhibit (h)(3)(b)
TRANSFER AGENCY AGREEMENT
Made as of the ___ day of February, 2005
by and between
EACH OF THE ENTITIES LISTED ON EXHIBIT A HERETO
And
BOSTON FINANCIAL DATA SERVICES, INC.
TABLE OF CONTENTS
Documents to be Filed with Appointment 3
Certain Representations and Warranties of BOSTON FINANCIAL 4
Certain Representations and Warranties of the Trust 5
Scope of Appointment 5
Limit of Authority 8
Compensation and Expenses 9
Operation of the TA2000(TM) System 11
Indemnification 14
Certain Covenants of BOSTON FINANCIAL and the Trust 17
Recapitalization or Readjustment 20
Certificates 20
Death, Resignation or Removal of Signing Officer 20
Future Amendments of Declaration of Trust and Bylaws 21
Instructions, Opinion of Counsel and Signatures 21
Force Majeure and Disaster Recovery Plans 21
Certification of Documents 22
Records 23
Disposition of Books, Records and Canceled Certificates 23
Provisions Relating to BOSTON FINANCIAL as Transfer Agent 23
Provisions Relating to Dividend Disbursing Agency 25
Assumption of Duties By the Trust or Agents Designated By the Trust 26
Termination of Agreement 27
Confidentiality and Information Security 28
Changes and Modifications 31
Assignment and Subcontractors 31
Limitations on Liability 32
Miscellaneous 32
Exhibit A - Fee Schedule
Exhibit B - Authorized Personnel
Appendix A
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TRANSFER AGENCY AGREEMENT
THIS AGREEMENT made as of the ____ day of _________, 2004, by and between
each of the entities listed on Appendix A hereto and each being an entity of the
type set for on Appendix A and organized under the laws of the state as set
forth on such Appendix, each with a principal place of business at 000 0xx Xxx.,
Xxx Xxxx, XX 00000 and each of which is acting on its own behalf and on behalf
of each of the portfolios listed under its name in Appendix A (jointly and
severally, such portfolios shall be referred to hereinafter as the "Fund" or
"Funds), but not jointly with any other entities listed on Appendix A and BOSTON
FINANCIAL DATA SERVICES, INC., a corporation existing under the laws of the
Commonwealth of Massachusetts, having its principal place of business at 0
Xxxxxxxx Xxxxx, Xxxxx Xxxxxx, Xxxxxxxxxxxxx 00000 ("BOSTON FINANCIAL"):
WITNESSETH:
WHEREAS, each Trust (as used hereinafter, the term "Trust" shall refer
jointly and severally to the trust entities set forth on Appendix A hereto, and
to each Fund listed in Appendix A, as the context requires) is a Massachusetts
or Delaware business trust or Maryland corporation registered with the
Securities and Exchange Commission as an investment company pursuant to the
Investment Company Act of 1940, as amended, which currently consists of the
Funds listed under its name on Appendix A; and
WHEREAS, the Trust desires to appoint BOSTON FINANCIAL as Transfer Agent
and Dividend Disbursing Agent for all common shares of beneficial interest of
each Fund of each Trust and, of shares of common stock of each Fund of each
corporation (the "Shares"), and BOSTON FINANCIAL desires to accept such
appointment;
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
the parties hereto agree as follows:
1. DOCUMENTS TO BE FILED WITH APPOINTMENT.
In connection with the appointment of BOSTON FINANCIAL as Transfer Agent
and Dividend Disbursing Agent for the Trust, there will be filed with BOSTON
FINANCIAL the following documents:
A. A certified copy of the votes of the Board of Trustees of the Trust
appointing BOSTON FINANCIAL as Transfer Agent and Dividend Disbursing
Agent, approving the form of this Agreement, and designating certain
persons to sign Shares certificates ("Certificates"), if any, and give
written instructions and requests on behalf of the Trust;
B. A certified copy of the Declaration of Trust or other organizational
documents of the Trust and all amendments thereto;
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C. A certified copy of the Bylaws of the Trust;
D. Copies of Registration Statements and amendments thereto, filed with the
Securities and Exchange Commission;
E. Specimens of all forms of outstanding Certificates;
F. Specimens of the signatures of the officers of the Trust authorized to
sign Certificates and individuals authorized to sign written
instructions and requests;
G. An opinion of counsel for the Trust with respect to:
(1) The Trust's organization and existence under the laws of its
state of organization,
(2) The status of all Shares, whether unissued or evidenced by
Certificates of the Trust, covered by the appointment under the
Securities Act of 1933, as amended, (the "'33 Act") (to the extent
applicable) and any other applicable federal or state statute, and
(3) That all issued Shares are, and all unissued Shares will be when
issued, validly issued, fully paid and non-assessable.
2. CERTAIN REPRESENTATIONS AND WARRANTIES OF BOSTON FINANCIAL.
BOSTON FINANCIAL represents and warrants to the Trust that:
A. It is a corporation duly organized and existing and in good standing
under the laws of the Commonwealth of Massachusetts.
B. It is duly qualified to carry on its business in the Commonwealth of
Massachusetts.
C. It is empowered under applicable laws and by its Articles of
Organization and Bylaws to enter into and perform the services contemplated
in this Agreement.
D. It is registered as a transfer agent to the extent required under
the Securities Exchange Act of 1934, as amended, (the "34 Act") and it will
remain so registered for the duration of this Agreement. It will promptly
notify the Trust in the event of any material change in its status as a
registered transfer agent. Should BOSTON FINANCIAL fail to be registered
with the appropriate federal agency as a transfer agent at any time during
this Agreement, the Trust may, on written notice to BOSTON FINANCIAL,
immediately terminate this Agreement.
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E. All requisite corporate proceedings have been taken to authorize it
to enter into and perform this Agreement.
F. It has and will continue to have and maintain the necessary
facilities, equipment personnel, policies and procedures to effectively
perform its duties and obligations under this Agreement and under the laws
applicable to its business and services.
G. It will perform its obligations in compliance with industry
standards and the laws applicable to its business and services.
3. CERTAIN REPRESENTATIONS AND WARRANTIES OF THE TRUST.
The Trust represents and warrants to BOSTON FINANCIAL that:
A. It is a business trust or corporation duly organized and existing
and in good standing under the laws of the state of its organization as set
forth on Appendix A.
B. It is, and with respect to each entity set forth on Appendix I, an
open-end, non-diversified management investment company registered under
the Investment Company Act of 940, as amended.
C. A registration statement under the '33 Act has been filed and will
be effective with respect to all Shares offered for sale. Except to the
extent that the Trust notifies BOSTON FINANCIAL that such Trust is not
required to be registered under the '33 Act.
D. All requisite steps have been and will continue to be taken to
register the Shares for sale in all applicable states and such registration
will be effective at all times Shares are offered for sale in such state.
E. The Trust is empowered under applicable laws and by its Declaration
of Trust (or other organizational documents if applicable) and Bylaws to
enter into and perform this Agreement.
4. SCOPE OF APPOINTMENT.
A. Subject to the conditions and termination of provisions set forth in
this Agreement, the Trust hereby appoints BOSTON FINANCIAL as Transfer
Agent and Dividend Disbursing Agent for the Shares and for the Shares of
future portfolios of the Trust (Appendix I shall be automatically deemed to
be revised to include such future portfolio(s)).
B. BOSTON FINANCIAL hereby accepts such appointment and agrees that it
will act as the Trust's Transfer Agent and Dividend Disbursing Agent.
BOSTON FINANCIAL agrees that it will also act as agent in connection with
the Trust's periodic withdrawal payment accounts and other open accounts or
similar plans for shareholders, if any.
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C. The Trust agrees to use its best efforts to deliver to BOSTON
FINANCIAL in Quincy, Massachusetts, as soon as they are available, all of
its shareholder account records for any new Fund of the Trust.
D. BOSTON FINANCIAL, utilizing TA2000(TM), a computerized data
processing system for securityholder accounting (the "TA2000(TM) System")
licensed from BOSTON FINANCIAL's affiliate, DST Systems, Inc. ("DST"), will
perform the following services as transfer and dividend disbursing agent
for the Trust, and as agent of the Trust for shareholder accounts thereof,
in a timely manner: (i) issuing (including countersigning), transferring
and canceling Certificates; (ii) maintaining all shareholder accounts;
(iii) providing transaction journals; (iv) once annually preparing
shareholder meeting lists for use in connection with the annual meeting and
certifying the shareholder votes of the Trust; (v) mailing shareholder
reports and prospectuses; (vi) withholding, as required by federal law,
taxes on shareholder accounts, disbursing income dividends and capital
gains distributions to shareholders, preparing, filing and mailing U.S.
Treasury Department Forms 1099, 1042, and 1042S and performing and paying
backup withholding as required for all shareholders; (vii) preparing and
mailing confirmation forms to shareholders and dealers, as instructed, for
all purchases and liquidations of shares of the Trust and other
transactions in shareholders' accounts requiring confirmation under
applicable law; (viii) recording reinvestment of dividends and
distributions in Shares; (ix) providing or making available on-line daily
and monthly reports as both are regularly provided by the TA2000(TM) System
and as requested by the Trust or its management company; (x) maintaining
those records necessary to carry out BOSTON FINANCIAL's duties hereunder,
including all information reasonably required by the Trust to account for
all transactions in the Shares, (xi) calculating the appropriate sales
charge with respect to each purchase of the Shares as set forth in the
prospectus for the Trust, determining the portion of each sales charge
payable to the dealer participating in a sale in accordance with schedules
delivered to BOSTON FINANCIAL by the Trust's principal underwriter or
distributor (hereinafter "principal underwriter") from time to time,
disbursing dealer commissions collected to such dealers, determining the
portion of each sales charge payable to such principal underwriter and
disbursing such commissions to the principal underwriter; (xii) receiving
correspondence pertaining to any former, existing or new shareholder
account, processing such correspondence for proper recordkeeping, and
responding promptly to shareholder correspondence; (xiii) mailing to
dealers confirmations of wire order trades; mailing copies of shareholder
statements to shareholders and dealers in accordance with the Trust's
instructions; (xiv) processing, generally on the date of receipt, purchases
or redemptions or instructions to settle any mail or wire order purchases
or redemptions received in proper order as set forth in the prospectus,
rejecting promptly any requests not received in proper order (as defined by
the Trust, the Trust's agents or prospectus, or the Procedures, as
hereinafter defined), and causing exchanges of shares to be executed in
accordance with the Trust's instructions and prospectus, the Procedures and
the general exchange privilege applicable; (xv) operating the order desk on
behalf of the Trust for the purpose of taking trade orders from
broker-dealers and institutions, confirming orders on "T+1" (Trade Date
Plus One), monitoring the settlement of such orders and advising the Trust
once such orders become
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delinquent based upon the Trust's guidelines; and (xvi) monitoring "as
of's" and advising broker-dealers of the necessity to reimburse the Trust
when the as of loss from a transaction exceeds the thresholds established
by the Trust.
E. At the request of Trust, BOSTON FINANCIAL shall use reasonable
efforts to provide the services set forth in Section 4.D. other than
through BOSTON FINANCIAL's usual methods and procedures to utilize the
TA2000 System, that is by performing services requiring more manual
intervention by BOSTON FINANCIAL, either in the entry of data or in the
modification or amendment of reports generated by the TA2000 System, or
where information is provided to BOSTON FINANCIAL after the commencement of
the nightly processing cycle of the TA2000 System, thereby decreasing the
effective time for performance by BOSTON FINANCIAL (the "Exception
Services").
F. BOSTON FINANCIAL shall use reasonable efforts to provide, reasonably
promptly under the circumstances, the same services with respect to any
new, additional functions or features or any changes or improvements to
existing functions or features as provided for in the Trust's instructions,
prospectus or application as amended from time to time, for the Trust;
provided (i) BOSTON FINANCIAL is advised in advance by the Trust of any
changes therein and (ii) the TA2000(TM) System and the mode of operations
utilized by BOSTON FINANCIAL, as then constituted, supports such additional
functions and features. If any addition to, improvement of or change in the
features and functions currently provided by the TA2000(TM) System or the
operations as requested by the Trust requires an enhancement or
modification to the TA2000(TM) System or to operations as presently
conducted by BOSTON FINANCIAL, BOSTON FINANCIAL shall not be liable
therefor until such modification or enhancement is installed on the
TA2000(TM) System or new mode of operation is instituted. If any new,
additional function or feature or change or improvement to existing
functions or features or new service or mode of operation requested by the
Trust (and which is not covered by Section 24 of this Agreement) measurably
increases BOSTON FINANCIAL's cost of performing the services required
hereunder at the current level of service, BOSTON FINANCIAL shall advise
the Trust of the amount of such increase and if the Trust elects to utilize
such function, feature or service, BOSTON FINANCIAL shall be entitled to
increase its fees by the amount of the increase in costs. In no event shall
BOSTON FINANCIAL be responsible for or liable to provide any additional
function, feature, improvement or change in method of operation requested
by the Trust until it has consented thereto in writing.
G. The Trust shall have the right to add all new Funds of the Trust to
the TA2000(TM) System, provided that the Trust provides BOSTON FINANCIAL
with at least thirty (30) days' prior written notice and provided, further,
that the requirements of the new series are generally consistent with
services then being provided by BOSTON FINANCIAL under this Agreement.
Rates or charges for additional Funds shall be as set forth in Exhibit A,
as hereinafter defined, for the remainder of the contract term except as
such Fund uses functions, features or characteristics for which BOSTON
FINANCIAL has imposed an additional charge as part of its standard pricing
schedule. In the latter event,
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rates and charges shall be in accordance with BOSTON FINANCIAL's
then-standard pricing schedule.
H. BOSTON FINANCIAL shall maintain a quality control process designed
to provide a consistent level of quality and timeliness for its transaction
processing. BOSTON FINANCIAL's performance of the Services under this
Agreement will be measured against service level standards ("SLAs"), which
will be established in good faith by mutual written agreement of the
parties and shall be made a part of this Agreement as Schedule 4.H.
Following the establishment and implementation of the SLAs, BOSTON
FINANCIAL shall provide to the Trust, a monthly report with respect to
BOSTON FINANCIAL's processing against the SLAs. In order that BOSTON
FINANCIAL may reasonably estimate the staffing needed to maintain the SLAs,
the Trust agrees to use its best efforts to communicate to BOSTON FINANCIAL
all sales and volume projections prior to the beginning of each quarter and
to provide the BOSTON FINANCIAL with advance notice of any product
development, sales or marketing campaigns that the Trust determines may
materially impact the volume of transactions in the Funds. The parties
agree to work together to resolve any performance issues in good faith. The
parties annually shall review and discuss the SLAs and shall make such
changes therein as to which they mutually agree. The parties agree that the
SLAs shall not apply to, and shall not be calculated for, any particular
day when: (i) the TA2000(TM) System or any computer hardware or software,
which is substantially required for the performance of the Services, is
unavailable for more than sixty (60) minutes, provided that such
unavailability is beyond BOSTON FINANCIAL's reasonable control and BOSTON
FINANCIAL notifies the Trust promptly of such unavailability; (ii) there is
a failure or unavailability of communication lines outside of BOSTON
FINANCIAL's facilities; (iii) there is a disaster that requires BOSTON
FINANCIAL to process at its disaster recovery site or when BOSTON
FINANCIAL's transaction processing is impeded by an event described in
SECTION 15 hereof; or (iv) the failure to perform is caused by third
parties (including the Trust) whose actions are beyond BOSTON FINANCIAL's
reasonable control.
5. LIMIT OF AUTHORITY.
Unless otherwise expressly limited by the resolution of appointment or by
subsequent action by the Trust, the appointment of BOSTON FINANCIAL as
Transfer Agent will be construed to cover the full amount of authorized
Shares of the class or classes for which BOSTON FINANCIAL is appointed as
the same will, from time to time, be constituted, and any subsequent
increases in such authorized amount.
In case of such increase the Trust will file with BOSTON FINANCIAL:
A. If the appointment of BOSTON FINANCIAL was theretofore expressly
limited, a certified copy of a resolution of the Board of Trustees of the
Trust increasing the authority of BOSTON FINANCIAL;
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B. A certified copy of the amendment to the Declaration of Trust of the
Trust authorizing the increase of stock;
C. A certified copy of the order or consent of each governmental or
regulatory authority required by law to consent to the issuance of the
increased stock, or an opinion of counsel that the order or consent of no
other governmental or regulatory authority is required;
D. Opinion of counsel for the Trust stating:
(1) The status of the additional Shares of the Trust under the '33
Act and any other applicable federal or state statute; and
(2) That the additional shares are, or when issued will be, validly
issued, fully paid and non-assessable.
6. COMPENSATION AND EXPENSES.
A. In consideration for its services hereunder as Transfer Agent and
Dividend Disbursing Agent, the Trust will pay to BOSTON FINANCIAL,
from time to time, a reasonable compensation for all services rendered
as Agent and, also, all BOSTON FINANCIAL's reasonable billable
out-of-pocket expenses or disbursements ("Compensation and Expenses")
incurred in connection with the agency. "Expenses" are more fully
described in Section 6.B. of this Agreement. Such Compensation and
Expenses are set forth in a separate schedule previously agreed to by
the Trust and BOSTON FINANCIAL, a copy of which is attached hereto as
Exhibit A. If the Trust has not paid such Compensation and Expenses to
BOSTON FINANCIAL within a reasonable time, BOSTON FINANCIAL may charge
against any monies held under this Agreement, the amount of any
Compensation and Expenses for which it shall be entitled to
reimbursement under this Agreement.
B. The Trust also agrees promptly to reimburse BOSTON FINANCIAL for all
reasonable billable out-of-pocket expenses or disbursements incurred
by BOSTON FINANCIAL in connection with the performance of services
under this Agreement including, but not limited to: expenses for
postage; express delivery services; freight charges; envelopes,
checks, drafts, forms (continuous or otherwise); specially requested
reports and statements; telephone calls; telegraphs; stationery
supplies; counsel fees incurred in connection with the review of the
legal sufficiency of documentation provided by a shareholder or
otherwise as to the advisability of complying with the request or
instruction of a shareholder or person purporting to act on behalf of
a shareholder (provided that BOSTON FINANCIAL provides the Trust with
reasonable advance notice of any such request and permits the Trust to
elect to undertake its own review of the legal sufficiency of such
documentation or as to the advisability of complying with such request
or instruction); outside printing and mailing firms (including DST
Output, Inc. and its affiliates ("DST Output");
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magnetic tapes, reels or cartridges (if sent to the Trust or to a
third party at the Trust's request) and magnetic tape handling
charges; off-site record storage and media for storage of records
(e.g., microfilm, microfiche, optical platters, computer tapes);
computer equipment installed at the Trust's request at the Trust's or
a third party's premises; telecommunications equipment and
telephone/telecommunication lines between the Trust and its agents, on
one hand, and BOSTON FINANCIAL on the other; proxy soliciting,
processing and/or tabulating costs; transmission of statement data for
remote printing or processing other than by DST Output (at a charge of
.035/record); and National Securities Clearing Corporation ("NSCC")
transaction fees to the extent any of the foregoing are paid or
incurred by BOSTON FINANCIAL. The Trust agrees to pay postage expenses
at least one day in advance if so requested. In addition, any other
expenses incurred by BOSTON FINANCIAL at the request or with the
consent of the Trust will be promptly reimbursed by the Trust.
C. Amounts due hereunder shall be due and paid on or before the sixtieth
(60th) calendar day after receipt of the invoice therefor by the Trust
(the "Due Date"). The Trust is aware that its failure to pay all
amounts in a timely fashion so that they will be received by BOSTON
FINANCIAL on or before the Due Date will give rise to costs to BOSTON
FINANCIAL not contemplated by this Agreement, including but not
limited to carrying, processing and accounting charges. Accordingly,
subject to Section 6.D. hereof, in the event that during any twelve
(12) month period the Trust pays any four (4) or more of its invoices
after their respective Due Dates, then BOSTON FINANCIAL may charge and
the Trust shall pay a late charge for any future invoices paid after
the applicable Due Date and such late charge shall be equal to the
lesser of the maximum amount permitted by applicable law or the London
Interbank Overnight Rate times the amount overdue, times the number of
days from the Due Date up to and including the day on which payment is
received by BOSTON FINANCIAL. The parties hereby agree that such late
charge represents a fair and reasonable computation of the costs
incurred by reason of late payment or payment of amounts not properly
due. Acceptance of such late charge shall in no event constitute a
waiver of the Trust's or BOSTON FINANCIAL's default or prevent the
non-defaulting party from exercising any other rights and remedies
available to it.
D. In the event that any charges are disputed, the Trust shall, on or
before the Due Date, pay all undisputed amounts due hereunder and
notify BOSTON FINANCIAL in writing of any disputed charges for
billable expenses that it is disputing in good faith. Payment for such
disputed charges shall be due on or before the close of the fifth
(5th) business day after the day on which BOSTON FINANCIAL provides to
the Trust documentation which an objective observer would agree
reasonably supports the disputed charges (the "Revised Due Date").
Late charges shall not begin to accrue as to charges disputed in good
faith until the first business day after the Revised Due Date.
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E. The fees and charges set forth on Exhibit A shall increase or may be
increased as follows:
(1) On the first day of each anniversary of this Agreement,
subject to Note E of Exhibit A;
(2) BOSTON FINANCIAL may increase the fees and charges set forth
on Exhibit A upon at least ninety (90) days prior written notice, if
changes in existing laws, rules or regulations: (i) require
substantial system modifications or (ii) materially increase BOSTON
FINANCIAL's cost of performance hereunder;
(3) BOSTON FINANCIAL may charge for additional features of TA2000
used by the Trust which features are not consistent with the Trust's
current processing requirements; and
(4) In the event BOSTON FINANCIAL, at the Trust's request or
direction, performs Exception Services, BOSTON FINANCIAL shall be
entitled to increase the fees and charges for such Exception Services
from those set forth on Exhibit A to the extent such Exception
Services increase BOSTON FINANCIAL's cost of performance. This
provision shall not apply to the Exception Services, if any, being
provided as of the date of this Agreement, which the parties shall
mutually agree upon and set forth on Schedule 6.E.(4) to this
Agreement.
If BOSTON FINANCIAL notifies the Trust of an increase in fees or charges
pursuant to subparagraph (2) of this Section 6.E., the parties shall
confer, diligently and in good faith and agree upon a new fee to cover the
amount necessary, but not more than such amount, to reimburse BOSTON
FINANCIAL for the Trust's aliquot portion of the cost of developing the new
software to comply with regulatory charges and for the increased cost of
operation.
If BOSTON FINANCIAL notifies the Trust of an increase in fees or charges
under subparagraphs (3) or (4) of this Section 6.E., the parties shall
confer, diligently and in good faith, and agree upon a new fee to cover
such new Trust feature.
7. OPERATION OF THE TA2000(TM) SYSTEM.
In connection with the performance of its services under this Agreement, BOSTON
FINANCIAL is responsible for such items as:
A. That entries in BOSTON FINANCIAL's records, and in the Trust's records
on the TA2000(TM) System created by BOSTON FINANCIAL and BOSTON
FINANCIAL's affiliates, accurately reflect the orders, instructions,
and other information received by BOSTON FINANCIAL and such affiliates
from the Trust, the Trust's distributor, manager or principal
underwriter, or any successor of any of the foregoing (all hereinafter
referred to as "JPM") and its affiliates, entities from whom JPM or
the Trust have directed BOSTON FINANCIAL to accept orders,
instructions or other
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information, the Trust's investment adviser, banks or other entities
which BOSTON FINANCIAL has been advised by the Trust or JPM are
affiliated with or a correspondent of JPM, or the Trust's
administrator (each of the foregoing being an "Authorized Person"),
broker-dealers or shareholders (existing or new). BOSTON FINANCIAL has
currently been instructed, by way of example and not limitation, to
accept telephone instructions from any person reasonably believed by
BOSTON FINANCIAL to be a representative of an Authorized Person, to
accept third party checks initiated by or received from or through a
broker/dealer or a JPM-customer relationship, to accept transactions
and documentation by fax in accordance with the guidelines established
by an Authorized Person, to allow corporations, partnerships, trusts
and other accounts not registered in the name of a single individual
and individually owned accounts to have telephone or "VOICE"
transaction processing privileges (the "Privileges"), to establish
Privileges on all accounts unless the establishing shareholder
explicitly directs that telephone exchanges and redemptions not be
permitted and to accept and to effectuate transmissions and trades
entered on a remote basis by JPM and banks affiliated with JPM
(without verification of the contents of such transmissions and
trades);
B. That shareholder lists, shareholder account verifications,
confirmations and other shareholder account information to be produced
from its records or data be available and accurately reflect the data
in the Trust's records on the TA2000(TM) System;
C. The accurate and timely issuance of dividend and distribution checks
in accordance with instructions received from the Trust and the data
in the Trust's records on the TA2000(TM) System;
D. That redemption transactions and payments be effected timely, to be
processed under normal circumstances on the day of receipt, and
accurately in accordance with redemption instructions received by
BOSTON FINANCIAL from Authorized Persons, broker-dealers or
shareholders and the data in the Trust's records on the TA2000(TM)
System;
E. The deposit daily in the Trust's appropriate special bank account of
all checks and payments received by BOSTON FINANCIAL from NSCC,
broker-dealers or shareholders for investment in shares;
F. Notwithstanding anything herein to the contrary, with respect to "as
of" adjustments, BOSTON FINANCIAL will not assume one hundred percent
(100%) responsibility for losses resulting from "as of's" due to
clerical errors or misinterpretations of shareholder instructions, but
BOSTON FINANCIAL will discuss with the Fund BOSTON FINANCIAL's
accepting liability for an "as of" on a case-by-case basis and will
accept financial responsibility for a particular situation resulting
in a financial loss to the Fund where such loss is "material", as
hereinafter defined, and, under the particular facts at issue, BOSTON
FINANCIAL's conduct was culpable and BOSTON FINANCIAL's conduct is the
sole cause of the loss. A loss is "material" for purposes of this
Section 7.F. when it results in a pricing error on a particular
transaction which is (i) greater
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than a negligible amount per shareholder, (ii) equals or exceeds one
($.01) full cent per share times the number of shares outstanding or
(iii) equals or exceeds the product of one-half of one percent (1/2%)
times the Fund's Net Asset Value per share times the number of shares
outstanding (or, in case of (ii) or (iii), such other amounts as may
be adopted by applicable accounting or regulatory authorities from
time to time). If the net effect of the "as of" transactions that are
determined to be caused by BOSTON FINANCIAL is negative and exceeds
the above limit, then BOSTON FINANCIAL shall promptly contact the
Trust and the Fund accountants. BOSTON FINANCIAL will work with the
Trust and the Fund accountants to determine what, if any, impact the
threshold break has on the Fund's Net Asset Value and what, if any,
further action is required. These further actions may include but are
not limited to, the Fund re-pricing the affected day(s), BOSTON
FINANCIAL re-processing, at its expense, all affected transactions in
the Fund that took place during the period or a payment to the Fund.
The Fund agrees to work in good faith with BOSTON FINANCIAL and
wherever possible, absent a regulatory prohibition or other mutually
agreed upon reason, the Fund agrees to re-price the affected day(s)
and to allow BOSTON FINANCIAL to re-process the affected transactions.
When such re-pricing and re-processing is not possible, and when
BOSTON FINANCIAL must contribute to the settlement of a loss, BOSTON
FINANCIAL's responsibility will commence with that portion of the loss
over $0.0049 per share calculated on the basis of the total value of
all shares owned by the affected portfolio (i.e., on the basis of the
value of the shares of the total portfolio, including all classes of
that portfolio, not just those of the affected class) and BOSTON
FINANCIAL will make such account adjustments and take such other
action as is necessary to compensate shareholders for shareholder
losses and reimburse the Fund for the amount of Fund losses in
accordance with the foregoing standards. If BOSTON FINANCIAL
contributes to the settlement of a loss, the amount paid by BOSTON
FINANCIAL shall be deducted from the amount of any accumulated losses
calculated in the fiscal year monitoring process described below.
BOSTON FINANCIAL will monitor all portfolios across share classes to
determine the accumulated gain or loss effect of "as-of trades" caused
solely by the transfer agent. At the fiscal year end of each
portfolio, if the portfolio has an accumulated loss across share
classes that is attributed to the transfer agent, then BOSTON
FINANCIAL shall pay to the Fund the amount of such loss in excess of
$.0049 per share calculated on the basis of the total value of all
shares owned by the affected portfolio (i.e., on the basis of the
value of the shares of the total portfolio, including all classes of
that portfolio, not just those of the affected class). If at the end
of the fiscal year, a portfolio has accumulated a gain across share
classes, that gain will remain with the Fund.
G. The requiring of proper forms of instructions, signatures and
signature guarantees and any necessary documents supporting the
opening of shareholder accounts, transfers, redemptions and other
shareholder account transactions, all in conformance with BOSTON
FINANCIAL's present procedures as set forth in its Legal Manual
(collectively the "Procedures") with such changes or deviations
therefrom as may be from time to time required or approved by the
Trust, its investment adviser or principal underwriter, or its or
BOSTON FINANCIAL's counsel and the rejection of orders or
13
instructions not in good order in accordance with the applicable
prospectus or the Procedures; and
H. The maintenance of a current, duplicate set of the Trust's essential
records at a secure separate location, in a form available and usable
forthwith in the event of any breakdown or disaster disrupting its
main operation.
8. INDEMNIFICATION.
A. BOSTON FINANCIAL shall at all times use reasonable care, due diligence
and act in good faith in performing its duties under this Agreement
and agrees to use its best efforts within reasonable limits to insure
the accuracy of all services performed under this Agreement. BOSTON
FINANCIAL shall provide its services hereunder in accordance with the
'34 Act, and other laws, rules and regulations of governmental
authorities having jurisdiction over BOSTON FINANCIAL. In the absence
of bad faith, willful misconduct, knowing or reckless violations of
applicable law pertaining to the manner in which transfer agency
services are to be performed by BOSTON FINANCIAL (excluding any
violations arising directly or indirectly out of the actions or
omissions to act of third parties unaffiliated with BOSTON FINANCIAL),
reckless disregard of the performance of its duties, or negligence on
its part, BOSTON FINANCIAL shall not be liable for any action taken,
suffered, or omitted by it or for any error of judgment made by it in
the performance of its duties under this Agreement. For those
activities or actions delineated in the Procedures, BOSTON FINANCIAL
shall be presumed to have used reasonable care, due diligence and
acted in good faith if it has acted in accordance with the Procedures,
copies of which have been provided to the Trust and reviewed and
approved by the Trust's counsel, as amended from time to time with
approval of Trust's counsel, or for any deviation therefrom approved
by the Trust or BOSTON FINANCIAL counsel.
B. BOSTON FINANCIAL shall not be responsible for, and the Trust shall
indemnify and hold BOSTON FINANCIAL harmless from and against, any and
all losses, damages, reasonable costs, reasonable charges, reasonable
counsel fees, payments, reasonable expenses and liability (the
"Adverse Consequences") which may be asserted against BOSTON FINANCIAL
or for which BOSTON FINANCIAL may be held to be liable, arising out of
or attributable to:
(1) All actions of BOSTON FINANCIAL required to be taken by BOSTON
FINANCIAL pursuant to this Agreement, provided that BOSTON FINANCIAL
has acted in good faith and with due diligence and reasonable care;
(2) The Trust's refusal or failure to comply with the terms of this
Agreement, the Trust's negligence or willful misconduct, or the breach
of any representation or warranty of the Trust hereunder;
(3) The good faith reliance on, or the carrying out of, any written
or oral instructions or requests of persons designated by the Trust in
writing (see Exhibit B) from time to
14
time as authorized to give instructions on its behalf or
representatives of an Authorized Person or BOSTON FINANCIAL's good
faith reliance on, or use of, information, data, records and documents
received from, or which have been prepared and/or maintained by the
Trust, its investment advisor, its sponsor or its principal
underwriter;
(4) Defaults by dealers or shareowners with respect to payment for
share orders previously entered;
(5) The offer or sale of Shares in violation of any requirement
under federal securities laws or regulations or the securities laws or
regulations of any state or in violation of any stop order or other
determination or ruling by any federal agency or state with respect to
the offer or sale of such shares in such state (unless such violation
results from BOSTON FINANCIAL's failure to comply with written
instructions of the Trust or of any officer of the Trust that no
offers or sales be input into the Trust's securityholder records in or
to residents of such state);
(6) Any error or mistake of the Trust, any Authorized Person, and
any agent designated by the Trust in the use of the TA2000(TM) System,
the data center, computer and related equipment used to access the
TA2000(TM) System (the "DST Facilities"), and control procedures
relating thereto in the verification of output and in the remote input
of data;
(7) Errors, inaccuracies, and omissions in, or errors, inaccuracies
or omissions of BOSTON FINANCIAL arising out of or resulting from such
errors, inaccuracies and omissions in, the Trust's records,
shareholder and other records, delivered to BOSTON FINANCIAL hereunder
by the Trust or its prior agent(s);
(8) Actions or omissions to act by the Trust or agents designated by
the Trust with respect to duties assumed thereby as provided for in
Section 21 hereof; and
(9) BOSTON FINANCIAL's performance of Exception Services except
where BOSTON FINANCIAL acted or omitted to act in bad faith, with
reckless disregard of its obligations or with negligence.
(10) The Trust's breach or violation of the Ethical Hack Guidelines
(as hereinafter defined) of BOSTON FINANCIAL and/or its affiliates.
C. Except where BOSTON FINANCIAL is entitled to indemnification under
Section 8.B. hereof and with respect to "as of's" set forth in Section
7.F., BOSTON FINANCIAL shall indemnify and hold the Trust harmless
from and against any and all Adverse Consequences arising out of
BOSTON FINANCIAL's failure to comply with the terms of this Agreement
or arising out of or attributable to BOSTON FINANCIAL's negligence,
willful misconduct or reckless disregard of its obligations under this
Agreement or BOSTON FINANCIAL's breach of any of its representations
or warranties under this Agreement. In the event that any claim is
asserted against BOSTON FINANCIAL under this Agreement for any reason
other than BOSTON
15
FINANCIAL's bad faith or willful misconduct, BOSTON FINANCIAL's
liability with respect to, arising from or arising in connection with
this Agreement, or from all services provided or omitted to be
provided under this Agreement, whether in contract, or in tort, or
otherwise, is limited to, and shall not exceed, the amounts paid
hereunder by the Trust to BOSTON FINANCIAL as fees and charges, but
not including reimbursable expenses, during the previous sixteen (16)
months (the "Liability Limitation Amount"). The Liability Limitation
Amount set forth in this Section shall not apply to Adverse
Consequences resulting from any fraud committed by BOSTON FINANCIAL's
employees or any intentional or malevolent violations(1) by BOSTON
FINANCIAL's employees. In the event that a claim giving rise to
liability by BOSTON FINANCIAL occurs prior to the completion of the
first sixteen (16) months of the Agreement, the Liability Limitation
Amount shall be calculated by adding: (1) the amounts actually paid
hereunder for such period by the Trust to BOSTON FINANCIAL as fees and
charges, but not including reimbursable expenses; and (2) an amount
equal to (x) an average monthly fee (determined based on the actual
fees received and number months that have passed as of the calculation
date) multiplied by (y) the number of months remaining to reach
sixteen months.
D. EXCEPT FOR INTENTIONAL MALEVOLENT VIOLATIONS(1) OF SECTION 23, IN NO
EVENT AND UNDER NO CIRCUMSTANCES SHALL EITHER PARTY TO THIS AGREEMENT
BE LIABLE TO ANYONE, INCLUDING, WITHOUT LIMITATION TO THE OTHER PARTY,
FOR CONSEQUENTIAL DAMAGES FOR ANY ACT OR FAILURE TO ACT UNDER ANY
PROVISION OF THIS AGREEMENT EVEN IF ADVISED OF THE POSSIBILITY
THEREOF.
E. Promptly after receipt by an indemnified person of notice of the
commencement of any action, such indemnified person will, if a claim
in respect thereto is to be made against an indemnifying party
hereunder, notify the indemnifying party in writing of the
commencement thereof; but the failure so to notify the indemnifying
Party will not relieve an indemnifying party from any liability that
it may have to any indemnified person for contribution or otherwise
under the indemnity agreement contained herein except to the extent it
is prejudiced as a proximate result of such failure to timely notify.
In case any such action is brought against any indemnified person and
such indemnified person seeks or intends to seek indemnity from an
indemnifying party, the indemnifying party will be entitled to
participate in, and, to the extent that it may wish, assume the
defense thereof (in its own name or in the name and on behalf of any
indemnified party or both with counsel reasonably satisfactory to such
indemnified person); provided, however, if the defendants in any such
action include both the indemnified person and an indemnifying party
and the indemnified person shall have reasonably concluded that there
may be a conflict between the positions of the indemnified person and
an indemnifying party in conducting the defense of any such
----------
(1) For purposes of Sections 8.C. and 8.D, "intentional malevolent violations"
shall mean those acts undertaken purposefully under circumstances in which the
person acting knows or has reason to believe that such act violates such
person's obligations under this Agreement and is likely to cause danger or harm
to the other party or its shareholders.
16
action or that there may be legal defenses available to it and/or
other indemnified persons which are inconsistent with those available
to an indemnifying party, the indemnified person or indemnified
persons shall have the right to select one separate counsel (in
addition to local counsel) to assume such legal defense and to
otherwise participate in the defense of such action on behalf of such
indemnified person or indemnified persons at such indemnified party's
sole expense. Upon receipt of notice from an indemnifying party to
such indemnified person of its election so to assume the defense of
such action and approval by the indemnified person of counsel, which
approval shall not be unreasonably withheld (and any disapproval shall
be accompanied by a written statement of the reasons therefor), the
indemnifying party will not be liable to such indemnified person
hereunder for any legal or other expenses subsequently incurred by
such indemnified person in connection with the defense thereof. An
indemnifying party will not settle or compromise or consent to the
entry of any judgment with respect to any pending or threatened claim,
action, suit or proceeding in respect of which indemnification or
contribution may be sought hereunder (whether or not the indemnified
persons are actual or potential parties to such claim, action, suit or
proceeding) unless such settlement, compromise or consent includes an
unconditional release of each indemnified person from all liability
arising out of such claim, action, suit or proceeding. An indemnified
party will not, without the prior written consent of the indemnifying
party, settle or compromise or consent to the entry of any judgment
with respect to any pending or threatened claim, action, suit or
proceeding in respect of which indemnification or contribution may be
sought hereunder. If it does so, it waives its right to
indemnification therefor.
F. In any case an indemnifying person may be asked to indemnify or save
an indemnified person harmless, the indemnified person shall use
reasonable care to (i) fully and promptly advise the indemnifying
person of all pertinent facts concerning the situation in question,
and (ii) timely advise the indemnifying person of any matter as to
which the indemnified person is aware that a claim which may give rise
to Adverse Consequences has been asserted or is being threatened and
appears reasonably likely to be asserted.
9. CERTAIN COVENANTS OF BOSTON FINANCIAL AND THE TRUST.
A. All requisite steps will be taken by the Trust from time to time when
and as necessary to register the Shares for sale in all states in
which the Shares shall at the time be offered for sale and require
registration. If at any time the Trust receives notice of any stop
order or other proceeding in any such state affecting such
registration or the sale of the Shares, or of any stop order or other
proceeding under the federal securities laws affecting the sale of the
Shares, the Trust will give prompt notice thereof to BOSTON FINANCIAL.
B. BOSTON FINANCIAL hereby agrees to perform such transfer agency
functions as are set forth in Section 4.D. above, to establish and to
maintain facilities and procedures reasonably acceptable to the Trust
for safekeeping of Certificates, check forms, and facsimile signature
imprinting devices, if any, and for the preparation or use, and the
17
keeping account of, such Certificates, forms and devices, and to carry
such insurance as BOSTON FINANCIAL considers adequate and reasonably
available, such consideration to be consistent with standards of
commercial reasonableness.
C. To the extent required by Section 31 of the Investment Company Act of
1940, as amended, and Rules thereunder, BOSTON FINANCIAL agrees that
all records maintained by BOSTON FINANCIAL relating to the services to
be performed by BOSTON FINANCIAL under this Agreement are the property
of the Trust and will be preserved and will be surrendered promptly to
the Trust on request.
D. BOSTON FINANCIAL agrees to furnish the Trust with a report in
accordance with Statements on Auditing Standards No. 70 (the "SAS 70
Report") as well as such other publicly available financial
information about itself or its affiliates and any reports and
information relating to BOSTON FINANCIAL's policies and procedures and
its compliance with such policies and procedures and with the laws
applicable to its business and services as the Trust may reasonably
request. BOSTON FINANCIAL further agrees that upon request by the
Trust, not more than once each year, it will review with the Trust
such information as is necessary to demonstrate BOSTON FINANCIAL's
current financial status. As a continuing obligation of BOSTON
FINANCIAL throughout the term of this Agreement, BOSTON FINANCIAL
agrees to notify the Trust (unless legally prohibited from so doing)
of any claims that BOSTON FINANCIAL reasonably believes would
materially adversely affect the ability of BOSTON FINANCIAL to provide
the services required under this Agreement.
E. BOSTON FINANCIAL represents and agrees that it will use its best
efforts within reasonable limits to keep current on the trends of the
investment company industry relating to shareholder services and will
use its best efforts to continue to modernize and improve.
Notwithstanding the foregoing, (i) BOSTON FINANCIAL shall not be
liable for failing to make any modification or improvement as to the
necessity of which the Trust has not advised BOSTON FINANCIAL in
writing and (ii) for any delay in the implementation of such
modification or improvement where BOSTON FINANCIAL reasonably requires
more time than was permitted by circumstances or such regulations.
F. BOSTON FINANCIAL will permit the Trust and its authorized
representatives, including its chief compliance officer, to make
periodic inspections of its operations and its policies and procedures
as such would involve the Trust at reasonable times during business
hours subject to such authorized representatives' execution of execute
a confidentiality agreement provided by BOSTON FINANCIAL.
G. BOSTON FINANCIAL agrees to use its best efforts to provide in Kansas
City, MO at the Trust's expense two (2) man weeks of training for
designated personnel in connection with use and operation of the
TA2000(TM) System for the Trust. All travel and reimbursable expenses
incurred by the Trust's personnel in connection with and during
training at BOSTON FINANCIAL's Facility or DST's Facility shall be
borne by the
18
Trust. At the Trust's option and expense, BOSTON FINANCIAL also agrees
to use its best efforts to provide an additional two (2) man weeks of
training at the Trust's facility for the Trust's personnel in
connection with the conversion to the TA2000(TM) System. Reasonable
travel, per diem and reimbursable expenses incurred by BOSTON
FINANCIAL personnel in connection with and during training at the
Trust's facility or in connection with the conversion shall be borne
by the Trust.
H. BOSTON FINANCIAL shall reasonably cooperate with the Trust's
independent public accountants and the Trust's chief compliance
officer and shall take all reasonable action in the performance of its
obligations under this Agreement to assure that access to all readily
necessary information and compliance personnel is made available to
such accountants and to the Trust's chief compliance officer, for the
expression of the accountants' opinion and the evaluation of the
effectiveness of BOSTON FINANCIAL's compliance controls, as such may
be required from time to time. Special reports or information may be
charged for. A report is "Special" if it is not regularly produced by
TA2000(TM) or requires special programming.
I. Ethical Hack. The parties have agreed that the Trust may conduct an
Ethical Hack, as part of the Trust's normal information security due
diligence review and compliance solely in accordance with the Ethical
Hack Guidelines or BOSTON FINANCIAL and/or its affiliates (the
"Ethical Hack Guidelines") a copy of which are attached hereto and
incorporated herein by reference as if fully set forth as Exhibit E.
The Trust agrees that any such Ethical Hack shall be performed
strictly in accordance with such Ethical Hack Guidelines. If
vulnerabilities are identified, then as part of the Services BOSTON
FINANCIAL and/or its affiliates shall promptly (i) document the system
remediation proposal, (ii) provide the Trust with such documentation
and reports on the status of modifications to correct such
vulnerabilities, and (iii) implement such remediation modifications as
may be required.
J. BOSTON FINANCIAL will provide assistance to and cooperate with the
Trust during any government or Trust directed audits (including audits
arranged by the Trust in connection with the implementation and
administration of the Trust's compliance policies and procedures) and
regulatory examinations of the Trust's records and accounts maintained
by BOSTON FINANCIAL in accordance with reasonable procedures and at
reasonable frequencies. For purposes of such regulatory examinations
or audits, at the request the Trust, BOSTON FINANCIAL will make
available, during normal business hours, all reasonably required
records, data and operating processes for review by (i) the
representatives of the appropriate regulatory agencies and/or (ii) any
auditors. The Trust understands and agrees that all auditors will be
required by BOSTON FINANCIAL to execute a confidentiality agreement
prior to being given access to such records, data and operating
processes.
K. Upon request of the Trust, BOSTON FINANCIAL will provide to the Trust
on a semi-annual or quarterly basis a Xxxxxxxx-Xxxxx certification
with respect to BOSTON FINANCIAL's performance of the services and its
internal controls related thereto. In addition, upon request of the
Trust, BOSTON FINANCIAL will provide to the Trust a
19
certification under Rule 38a-1 of the federal securities rules with
respect to the compliance provisions required by that Rule.
10. RECAPITALIZATION OR READJUSTMENT.
In case of any recapitalization, readjustment or other change in the capital
structure of the Trust requiring a change in the form of Certificates, BOSTON
FINANCIAL will issue or register Certificates in the new form in exchange for,
or in transfer of, the outstanding Certificates in the old form, upon receiving:
A. Written instructions from an officer of the Trust;
B. Certified copy of the amendment to the Declaration of Trust or
other document effecting the change;
C. Certified copy of the order or consent of each governmental or
regulatory authority, required by law to the issuance of the stock in
the new form, and an opinion of counsel that the order or consent of
no other government or regulatory authority is required;
D. Specimens of the new Certificates in the form approved by the
Board of Trustees of the Trust, with a certificate of the Secretary of
the Trust as to such approval;
E. Opinion of counsel for the Trust stating:
(1) The status of the shares of stock of the Trust in the new
form under the '33 Act, as amended and any other
applicable federal or state statute; and
(2) That the issued shares in the new form are, and all
unissued shares will be when registered, validly issued,
fully paid and nonassessable.
11. CERTIFICATES.
The Trust will furnish BOSTON FINANCIAL with a sufficient supply of blank
Certificates and from time to time will renew such supply upon the request of
BOSTON FINANCIAL. Such Certificates will be signed manually or by facsimile
signatures of the officers of the Trust authorized by law and by bylaws to sign
Certificates, and if required, will bear the corporate seal or facsimile
thereof.
12. DEATH, RESIGNATION OR REMOVAL OF SIGNING OFFICER.
The Trust will file promptly with BOSTON FINANCIAL written notice of any change
in the officers authorized to sign Certificates, written instructions or
requests, together with a revised Exhibit B. In case any officer of the Trust
who will have signed manually or whose facsimile signature will have been
affixed to blank Certificates will die, resign, or be removed prior to the
issuance of such Certificates, BOSTON FINANCIAL may issue or register such
Certificates as the Certificates of the Trust notwithstanding such death,
resignation, or removal, until
20
specifically directed to the contrary by the Trust in writing. In the absence of
such direction, the Trust will file promptly with BOSTON FINANCIAL such
approval, adoption, or ratification as may be required by law.
13. FUTURE AMENDMENTS OF DECLARATION OF TRUST AND BYLAWS.
The Trust will promptly file with BOSTON FINANCIAL copies of all material
amendments to its Declaration of Trust or Bylaws made after the date of this
Agreement.
14. INSTRUCTIONS, OPINION OF COUNSEL AND SIGNATURES.
Any time BOSTON FINANCIAL shall be in doubt as to any proposed or requested
action to be taken or omitted by it, BOSTON FINANCIAL may consult with any
person authorized by the Trust to give instructions to BOSTON FINANCIAL relating
to the particular proposed or requested action to be taken or omitted. BOSTON
FINANCIAL may with the approval of a Trust officer consult with legal counsel
for the Trust or may consult with BOSTON FINANCIAL's own legal counsel at BOSTON
FINANCIAL's own expense, with respect to any matter involving a question of law
involved in any action to be taken or omitted by BOSTON FINANCIAL in connection
with the agency. BOSTON FINANCIAL will not be liable for any action taken or
omitted by it in good faith in reliance upon such instructions or upon the
opinion of such counsel. Notwithstanding the foregoing, the Trust shall
reimburse BOSTON FINANCIAL for outside counsel fees incurred in connection with
the review of the legal sufficiency of documentation provided by a shareholder
or otherwise as to the advisability of complying with the request of a
shareholder or person purporting to act on behalf of a shareholder so long as
BOSTON FINANCIAL has complied with the requirements set forth in SECTION 6.B.
BOSTON FINANCIAL will be protected in acting upon any paper or document
reasonably believed by it to be genuine and to have been signed by the proper
person or persons and will not be held to have notice of any change of authority
of any person, until receipt of written notice thereof from the Trust. It will
also be protected in recognizing Certificates which it reasonably believes to
bear the proper manual or facsimile signatures of the officers of the Trust, and
the proper countersignature of any former Transfer Agent or Registrar, or of a
co-Transfer Agent or co-Registrar.
15. FORCE MAJEURE AND DISASTER RECOVERY PLANS.
A. BOSTON FINANCIAL shall not be responsible or liable for its failure or
delay in performance of its obligations under this Agreement arising
out of or caused, directly or indirectly, by circumstances beyond its
reasonable control, including, without limitation: any interruption,
loss or malfunction or any utility, transportation, computer (hardware
or software) or communication service; or a delay in mails;
governmental or exchange action, statute, ordinance, rulings,
regulations or direction; war, strike, riot, emergency, civil
disturbance, terrorism, vandalism, explosions, labor disputes,
freezes, floods, fires, tornadoes, acts of God or public enemy,
revolutions, or insurrection; or any other cause, contingency,
circumstance or delay not subject to BOSTON FINANCIAL's reasonable
control which prevents or hinders BOSTON FINANCIAL's performance
hereunder.
21
B. BOSTON FINANCIAL will maintain a comprehensive business continuity
plan and will provide an executive summary of such plan upon
reasonable request of the Trust. BOSTON FINANCIAL will test the
adequacy of its business continuity plan at least annually and upon
request, the Trust may participate in such test. Upon request by the
Trust, BOSTON FINANCIAL will provide the Trust with a letter assessing
the most recent business continuity test results. In the event of a
business disruption that materially impacts BOSTON FINANCIAL's
provision of services under this Agreement, BOSTON FINANCIAL will
notify the Trust of the disruption and the steps being implemented
under the business continuity plan. If the Trust reasonably determines
that BOSTON FINANCIAL has not or cannot put its disaster recovery plan
in place quickly enough to meet the Trust's needs or is otherwise
unable to provide equal access to such Services, BOSTON FINANCIAL
shall promptly provide reasonable assistance and support to the Trust,
at the Trust's expense, in seeking such services from an alternative
source.
C. BOSTON FINANCIAL's affiliate, DST, currently maintains a recovery
facility for use in event of a disaster rendering the DST Facilities
inoperable (the "DST Recovery Facility"). DST has developed and is
continually revising business contingency plans (the "DST Business
Contingency Plan") detailing which, how, when, and by whom data
maintained at DST Facilities will be installed and operated at the
Recovery Facility. BOSTON FINANCIAL will provide an executive summary
of the DST Business Contingency Plan upon reasonable request of the
Trust. Provided the Trust is paying its pro rata portion of the charge
therefor, BOSTON FINANCIAL would, in event of a disaster rendering the
DST's Facility inoperable, instruct DST to use reasonable efforts to
convert the TA2000(TM) System containing the designated Trust data to
the computers at the Recovery Facility in accordance with the then
current DST Business Contingency Plan.
D. BOSTON FINANCIAL also currently maintains, separate from the area in
which the operations that provides the services to the Trust hereunder
are located, a Crisis Management Center consisting of phones, computers
and the other equipment necessary to operate a full service transfer
agency business in the event one of its operations areas is rendered
inoperable. The transfer of operations to other operating areas or to
the Crisis Management Center is covered in BOSTON FINANCIAL's Business
Contingency Plan.
16. CERTIFICATION OF DOCUMENTS.
The required copy of the Declaration of Trust or Articles of Incorporation of
the Trust and copies of all amendments thereto will be certified by the
Secretary of State (or other appropriate official) of the State of
Incorporation, and if such Declaration of Trust and amendments are required by
law to be also filed with a county, city or other officer of official body, a
certificate of such filing will appear on the certified copy submitted to BOSTON
FINANCIAL, PROVIDED, HOWEVER, that if the Trust is not required to file the
Declaration of Trust with the State of Incorporation, but is required to file a
Certificate of Trust with such state, a copy of the Certificate of Trust and
copies of all amendment thereto will be certified by the Secretary of State (or
other appropriate official) of the State of Incorporation. A copy of the order
or consent of each governmental or regulatory authority required by law to the
issuance of the stock will be
22
certified by the Secretary or Clerk of such governmental or regulatory
authority, under proper seal of such authority. The copy of the Bylaws and
copies of all amendments thereto, and copies of resolutions of the Board of
Trustees of the Trust, will be certified by the Secretary or an Assistant
Secretary of the Trust under the Trust's seal.
17. RECORDS.
BOSTON FINANCIAL will maintain customary records in connection with its agency,
and particularly will maintain those records required to be maintained pursuant
to subparagraph (2) (iv) of paragraph (b) of Rule 31a-1 under the Investment
Company Act of 1940, if any.
18. DISPOSITION OF BOOKS, RECORDS AND CANCELED CERTIFICATES.
BOSTON FINANCIAL may send periodically to the Trust, or to where designated by
the Secretary or an Assistant Secretary of the Trust, all books, documents, and
all records no longer deemed needed for current purposes and Certificates which
have been canceled in transfer or in exchange, upon the understanding that such
books, documents, records, and Certificates will be maintained by the Trust
under and in accordance with the requirements of Rule 17Ad-7 adopted under the
'34. Such materials will not be destroyed by the Trust without the consent of
BOSTON FINANCIAL (which consent will not be unreasonably withheld), but will be
safely stored for possible future reference.
19. PROVISIONS RELATING TO BOSTON FINANCIAL AS TRANSFER AGENT.
A. BOSTON FINANCIAL will make original issues of Certificates upon
written request of an officer of the Trust and upon being furnished with
a certified copy of a resolution of the Board of Trustees authorizing
such original issue, an opinion of counsel as outlined in subparagraphs
1.G and 5.D of this Agreement, any documents required by Sections 5 or 10
of this Agreement, and necessary funds for the payment of any original
issue tax.
B. Before making any original issue of Certificates of the Trust will
furnish BOSTON FINANCIAL with sufficient funds to pay all required taxes
on the original issue of the stock, if any. The Trust will furnish BOSTON
FINANCIAL such evidence as may be required by BOSTON FINANCIAL to show
the actual value of the stock. If no taxes are payable BOSTON FINANCIAL
will be furnished with a certified statement from an officer of the Trust
to that effect.
C. Shares of stock represented by Certificates will be transferred and
new Certificates issued in transfer, or Shares of stock accepted for
redemption and funds remitted therefor, or book entry transfer be
effected, upon surrender of the old Certificates in form or receipt by
BOSTON FINANCIAL of instructions deemed by BOSTON FINANCIAL properly
endorsed for transfer or redemption accompanied by such documents as
BOSTON FINANCIAL may deem necessary to evidence the authority of the
person making the transfer or redemption. BOSTON FINANCIAL reserves the
right to refuse to transfer or redeem Shares until it is satisfied that
the
23
endorsement or signature on the Certificate or any other document is
valid and genuine, and for that purpose it may require a guaranty of
signature in accordance with the Procedures. BOSTON FINANCIAL will incur
no liability and shall be indemnified and held harmless by the Fund for
any action taken by it in accordance with an instruction bearing what
purports to be a signature guarantee or medallion of an Eligible
Guarantor Institution or otherwise in accordance with BOSTON FINANCIAL's
Signature Guarantee Procedures adopted pursuant to Rule 17Ad-15 under the
'34 Act. BOSTON FINANCIAL also reserves the right to refuse to transfer
or redeem shares until BOSTON FINANCIAL is satisfied that the requested
transfer or redemption is legally authorized, and it will incur no
liability for the refusal in good faith to make transfers or redemptions
which, in its reasonable judgment, are improper or unauthorized.
Authority to perform a redemption shall be suspended when the Trust
suspends the shareholders' right of redemption provided that the Trust
delivers written notice of such suspension to BOSTON FINANCIAL. BOSTON
FINANCIAL may, in effecting transfers or redemptions, rely upon
Simplification Acts, Uniform Commercial Code or other statutes that
protect it and the Trust in not requiring complete fiduciary
documentation. In cases in which BOSTON FINANCIAL is not directed or
otherwise required to maintain the consolidated records of shareholder's
accounts, BOSTON FINANCIAL will not be liable for any loss that may arise
by reason of not having such records.
D. When mail is used for delivery of Certificates, BOSTON FINANCIAL
will forward Certificates in "nonnegotiable" form by first class or
registered mail and Certificates in "negotiable" form by registered mail,
all such mail deliveries to be covered while in transit to the addressee
by insurance arranged for by BOSTON FINANCIAL.
E. BOSTON FINANCIAL will issue and mail subscription warrants,
Certificates representing stock dividends, exchanges or split ups, or act
as Conversion Agent upon receiving written instructions from any officer
of the Trust and such other documents as BOSTON FINANCIAL deems
necessary.
F. BOSTON FINANCIAL will issue, transfer, and split up Certificates and
will issue Certificates of stock representing full Shares upon surrender
of scrip certificates aggregating one full share or more when presented
to BOSTON FINANCIAL for that purpose upon receiving written instructions
from an officer of the Trust and such other documents as BOSTON FINANCIAL
may deem necessary.
G. BOSTON FINANCIAL may issue new Certificates in place of Certificates
represented to have been lost, destroyed, stolen or otherwise wrongfully
taken upon receiving instructions from the Trust and indemnity
satisfactory to BOSTON FINANCIAL and the Trust, and may issue new
Certificates in exchange for, and upon surrender of, mutilated
Certificates. Such instructions from the Trust will be in such form as
will be approved by the Board of Trustees of the Trust and will be in
accordance with the provisions of law and the bylaws of the Trust
governing such matter.
H. BOSTON FINANCIAL will supply a shareholder's list to the Trust for
its annual meeting upon receiving a request from an officer of the Trust.
It will also, at the expense
24
of the Trust, supply lists at such other times as may be requested by an
officer of the Trust.
I. Upon receipt of written instructions of an officer of the Trust,
BOSTON FINANCIAL will, at the expense of the Trust, address and mail
notices to shareholders.
J. In case of any request or demand for the inspection of the
securityholder files or stock books of the Trust or any other books or
records in the possession of the Trust in BOSTON FINANCIAL's possession,
BOSTON FINANCIAL will not permit such inspection, except (i) after prior
notification to and approval in writing by the Trust or Advisor as
appropriate, which approval shall not be unreasonably withheld and may
not be withheld or delayed where BOSTON FINANCIAL may be exposed to civil
or criminal contempt proceedings for failure to comply when requested to
divulge such information by duly constituted authorities, or (ii) when so
requested by the Trust or an Authorized Person. Nothing in the foregoing
is intended to, nor does it, prohibit or deny to BOSTON FINANCIAL the
right to disclose information requested by subpoena, Court Order,
administrative order or request issued by a federal, state or local
authority purporting to be issued under statutory authority or a
self-regulatory organization registered under the '34 Act. BOSTON
FINANCIAL shall use reasonable efforts to advise the Trust concerning
subpoenas received for records of the Trust and, upon being so advised,
the Trust shall be responsible for handling and responding thereto.
K. If the Trust elects to delegate to BOSTON FINANCIAL certain
Anti-Money Laundering and customer identification duties under this
Agreement, the parties will agree to such duties and terms as stated in
the attached schedule ("SCHEDULE19 K. entitled "AML Delegation" which may
be changed from time to time subject to mutual written agreement between
the parties. In consideration of the performance of the duties by BOSTON
FINANCIAL pursuant to this SECTION 19 K., the Trust agrees to pay BOSTON
FINANCIAL the fees applicable to such services as the parties may from
time to time agree.
20. PROVISIONS RELATING TO DIVIDEND DISBURSING AGENCY.
A. BOSTON FINANCIAL will, at the expense of the Trust, provide a
special form of check containing the imprint of any device or other
matter desired by the Trust. Said checks must, however, be of a form and
size convenient for use by BOSTON FINANCIAL.
B. If the Trust desires to include additional printed matter, financial
statements, etc., with the dividend checks, the same will be furnished
BOSTON FINANCIAL within a reasonable time prior to the date of mailing of
the dividend checks, at the expense of the Trust.
C. If the Trust desires its distributions mailed in any special form of
envelopes, sufficient supply of the same will be furnished to BOSTON
FINANCIAL but the size and form of said envelopes will be subject to the
approval of BOSTON FINANCIAL. If
25
stamped envelopes are used, they must be furnished by the Trust; or if
postage stamps are to be affixed to the envelopes, the stamps or the cash
necessary for such stamps must be furnished by the Trust.
D. BOSTON FINANCIAL shall establish and maintain, and is hereby
authorized to establish and to maintain, under the usual terms and
conditions prevalent in the industry and on behalf of the Trust as agent
of the Trust, in BOSTON FINANCIAL's own name or under the X.X. Xxxxxx
name (or that of the Trusts as a group or of an Affiliate thereof), one
or more deposit accounts, into which BOSTON FINANCIAL shall deposit the
funds BOSTON FINANCIAL receives for payment of dividends, distributions,
redemptions or other disbursements provided for hereunder and to draw
checks against such accounts.
E. BOSTON FINANCIAL is authorized and directed to stop payment of
checks theretofore issued hereunder, but not presented for payment, when
the payees thereof allege either that they have not received the checks
or that such checks have been mislaid, lost, stolen, destroyed or through
no fault of theirs, are otherwise beyond their control, and cannot be
produced by them for presentation and collection, and, to issue and
deliver duplicate checks in replacement thereof.
21. ASSUMPTION OF DUTIES BY THE TRUST OR AGENTS DESIGNATED BY THE TRUST.
A. The Trust or its designated agents other than BOSTON FINANCIAL may
assume certain duties and responsibilities with respect to the operations
of the Trust, including (with BOSTON FINANCIAL's agreement) providing
all, or a portion, of those services which BOSTON FINANCIAL is obligated
to provide under Section 4.D of this Agreement.
B. To the extent the Trust or its agent or affiliate assumes BOSTON
FINANCIAL's duties and responsibilities (which assumption should be
embodied in writing), BOSTON FINANCIAL shall be relieved from all
responsibility and liability therefore (including any Adverse
Consequences directly or indirectly arising out of or resulting from the
actions or omissions of the Trust or its designees, as well as from any
"as of" liability or withholding reversals in connection therewith) and
BOSTON FINANCIAL is hereby indemnified and held harmless against any
liability therefrom in the same manner and degree as provided for in
Section 8 hereof.
C. Initially, with respect to accounts serviced by JPM or banks
affiliated with or a correspondent of JPM, the Trust or its designees
shall be responsible for the following: (i) answering and responding to
telephone inquiries from shareholders and brokers; (ii) accepting
shareholder and broker instructions (either or both oral and written) and
(A) transmitting to BOSTON FINANCIAL orders (transactions and
maintenance) based on such instructions for input into TA2000 by BOSTON
FINANCIAL or (B) themselves inputting such orders into TA2000 on a remote
basis; (iii) preparing and mailing confirmations; (iv) classifying the
status of shareholders and shareholder accounts under applicable tax law
and in accordance with the capabilities provided on TA2000, and
26
performing all compliance functions with respect thereto, including
without limitation obtaining certified TIN's, Form W-8's and other
documentation, and properly coding accounts (social codes, tax status,
foreign accounts and so forth) as provided for on TA2000; (v) on a remote
basis establishing shareholder accounts on the TA2000(TM) System,
establishing the appropriate privileges thereupon and assigning social
codes and Taxpayer Identification Number codes thereof; (vi) disbursing
monies of the Trust; (vii) sending redemption and dividend wires in
accordance with instructions received; and (viii) following up and
collecting upon unsettled trade orders and unpaid broker-dealer,
institutional or shareholder "as of's."
22. TERMINATION OF AGREEMENT.
A. This Agreement shall be in effect from the ___ day of _____, 2005,
through the ____st day of _______ 2009 (the "Initial Term" of this
Transfer Agency Agreement"). This Agreement shall thereafter
automatically extend for additional, successive one (1) year terms upon
the expiration of any term hereof, unless terminated as of the end of any
term by either party on not less than one hundred and twenty (120) days
prior written notice to the other party. Each additional one (1) year
period shall be an additional term of this Agreement. However,
notwithstanding anything in this Agreement to the contrary, the effective
date of any termination shall not occur during the period from December
15 through March 30 of any year to avoid adversely impacting year end,
except if pursuant to Section 22.B of this Agreement. One hundred and
twenty (120) days before the expiration of the Initial Term or a renewal
term, the parties agree to negotiate in good faith and agree upon a fee
schedule for the upcoming renewal term. Notwithstanding the termination
or non-renewal of this Agreement, the terms and conditions of this
Agreement shall continue to apply until the completion of the
deconversion.
B. Each party, in addition to any other rights and remedies, shall have
the right to terminate this Agreement forthwith upon the occurrence at
any time of any of the following events with respect to the other party:
(1) The bankruptcy of the other party or its assigns or the appointment
of a receiver for the other party or its assigns;
(2) failure by the other party or its assigns to perform its duties
(including any material interruption or cessation of its operations) in
accordance with the Agreement, which failure materially adversely affects
the business operations of the first party and which failure continues
for thirty (30) days after receipt of written notice from the first
party, unless such failure is excused under Section 15 of this Agreement;
or
(3) merger, consolidation or sale of substantially all of the assets of
the other party or its assigns; provided, however, that this Section
22.B.3 shall not apply to any mergers, consolidations or sales of
substantially all of the assets of the Trust constituting a "shell
reorganization;" or
27
(4) acquisition of a controlling interest in the other party or its
assigns by any third party except as may presently exist within the
previous sixty (60) days.
In the event of a termination under this Section 22.B, the notice of
termination for the reasons provided in this Section 22.B must be
provided within sixty (60) days of a party's learning of a reason
permitting termination, and shall take effect within not less than ninety
(90) and more than one hundred eighty (180) days from the date of receipt
of the notice of termination. Any termination by reasons set forth in
Section 22.B(1) and (2) shall not be subject to any termination fees or
penalties relating to or arising out of termination, including without
limitation any such fees or penalties relating to or arising out of
termination set forth in "NOTES TO THE FEE SCHEDULE, " Paragraph E on
Exhibit A attached to this Agreement. In the event that (i) one or more
Trusts terminate this Agreement as the result of an acquisition by or
merger into another fund and the remaining Trusts wish to continue the
Agreement, or (ii) the Trusts terminate this Agreement as the result of
their acquisition by or merger into another fund and such other fund's
shareholder records are, at the time of such acquisition or merger,
maintained by BOSTON FINANCIAL or its affiliates, or (iii) one or more
Trusts wish to move its transfer agency servicing operation from BOSTON
FINANCIAL to an affiliated entity or another DST TA2000 platform (i.e.,
become a remote user of DST's TA2000 system) as the result of such Trusts
acquisition by or merger into another fund, then the parties agree to
negotiate in good faith to determine whether or to what extent the
termination fees under this Agreement shall apply to such termination.
C. BOSTON FINANCIAL may, on written notice to such Trust, immediately
terminate this Agreement as to any Trust which itself or its Shares fail
to be registered as provided in Section 3 of this Agreement at any time
during this Agreement.
D. In the event of termination, the Trust will promptly pay BOSTON
FINANCIAL all amounts due to BOSTON FINANCIAL hereunder, including any
termination fee set forth in Exhibit A to this Agreement.
E. In the event of termination, BOSTON FINANCIAL will use its best
efforts to transfer the records of the Trust to the designated successor
transfer agent, to provide reasonable assistance to the Trust and its
designated successor transfer agent, and to provide other information
relating to its services provided hereunder (subject to the recompense of
BOSTON FINANCIAL for such assistance at its standard rates and fees for
personnel then in effect at that time); provided, however, as used herein
"reasonable assistance" and "other information" shall not include
assisting any new service or system provider to modify, alter, enhance,
or improve its system or to improve, enhance, or alter its current
system, or to provide any new functionality or to require BOSTON
FINANCIAL to disclose any BOSTON FINANCIAL Confidential Information, as
hereinafter defined, or any information which is otherwise confidential
to BOSTON FINANCIAL.
28
23. CONFIDENTIALITY AND INFORMATION SECURITY.
A. BOSTON FINANCIAL agrees on behalf of itself, its affiliates, its
officers and employees, except as provided in Section 19.J. hereof, or as
otherwise required by law, BOSTON FINANCIAL will keep confidential all
records and data of and information in its possession relating to the
Trust or its shareholders or shareholder accounts in any form disclosed
to BOSTON FINANCIAL hereunder, including but not limited to any data and
information in any form disclosed by the Trust, anyone acting on behalf
of the Trust, or the Trust's customers, prospective customers, or
employees to BOSTON FINANCIAL, BOSTON FINANCIAL Personnel or any
Subcontractor including Consumer Information (as "Consumer Information"
is defined in SEC Regulation S-P) and non-public information which is
learned by BOSTON FINANCIAL without the Trust's intentional disclosure to
it. Such information includes all Trust software, specifications,
documentation, product proposals, financial information, data, source or
object code, documentation, manuals, studies, internally devised
technology, system or network architecture or topology, security
mechanisms, product or processing capacities, revenues, information
relating to the business of the Trust (including internal procedures and
policies, businesses plans, and products of the Trust), and all other
trade secret, confidential or proprietary information and documentation
of the Trust or its customers, prospective customers, employees,
directors, outside directors, retirees and their respective spouses and
families received in connection with this Agreement (whether or not it is
designated as such). BOSTON FINANCIAL shall not disclose the same to any
person except at the instruction (standing or specific), request or with
the consent of the Trust. Notwithstanding the foregoing, BOSTON FINANCIAL
shall be permitted in the ordinary course of business to provide such
information to third parties providing services to BOSTON FINANCIAL which
BOSTON FINANCIAL utilizes in connection with the services BOSTON
FINANCIAL provides to the Trust under this Agreement or in accordance
with Section 19.J. of this Agreement.
B. BOSTON FINANCIAL has provided the Trust with a summary of its
information security standards, which are subject to change by BOSTON
FINANCIAL from time to time to meet industry changes. BOSTON FINANCIAL
agrees to comply with such information security standards in the
performance of its services under this Agreement. BOSTON FINANCIAL
acknowledges receipt of the Trust's information security standards and,
to the extent that BOSTON FINANCIAL does not comply with the Trust's
standards, BOSTON FINANCIAL shall inform the Trust of the standards it
has adopted in lieu thereof.
C. The Trust on behalf of itself, its affiliates, its officers and
employees and all entities which it directs BOSTON FINANCIAL to provide
any of the following information agrees to keep confidential all
financial statements and other financial records (other than statements
and records relating solely to the Trust's business dealings with BOSTON
FINANCIAL) and all manuals, systems and other technical information and
data, not publicly disclosed, relating to the operations and programs of
BOSTON FINANCIAL and DST furnished to it by BOSTON FINANCIAL pursuant to
this
29
Agreement and will not disclose the same to any person except at the
request or with the consent of BOSTON FINANCIAL.
D. (1) The Trust acknowledges that BOSTON FINANCIAL and/or its
affiliates have proprietary rights in and to the TA2000(TM) System used
to perform services hereunder including, but not limited to the
maintenance of shareholder accounts and records, processing of related
information and generation of output, including, without limitation any
changes or modifications of the TA2000(TM) System and any other programs,
data bases, supporting documentation, or procedures and all software,
specifications, documentation, product proposals, financial information,
data, source or object code, documentation, manuals, studies, internally
devised technology, system or network architecture or topology, security
mechanisms, product or processing capacities, revenues, information
relating to the business of BOSTON FINANCIAL and/or its affiliates
(including internal procedures and policies, businesses plans, and
products of BOSTON FINANCIAL and/or its affiliates), and all other trade
secret, confidential or proprietary information and documentation of
BOSTON FINANCIAL and/or its Affiliates or its customers, prospective
customers, employees, directors, outside directors, retirees and their
respective spouses and families (whether or not it is designated as such)
and non-public information which is learned by the Trust without BOSTON
FINANCIAL's intentional disclosure to it (collectively "BOSTON FINANCIAL
Confidential Information") which the Trust's access to the TA2000(TM)
System or computer hardware or software may permit the Trust or its
agents or the Trust's employees, directors, outside directors, retirees,
their respective spouses and families to become aware of or to access and
that the BOSTON FINANCIAL Confidential Information constitutes
confidential material and trade secrets of BOSTON FINANCIAL and/or its
affiliates. The Trust agrees to maintain the confidentiality of the
BOSTON FINANCIAL Confidential Information of which it is, or becomes,
aware or to which it has access.
(2) The Trust acknowledges that any unauthorized use, misuse, disclosure
or taking of BOSTON FINANCIAL Confidential Information which is
confidential as provided by law, or which is a trade secret, residing or
existing internal or external to a computer, computer system, or computer
network, or the knowing and unauthorized accessing or causing to be
accessed of any computer, computer system, or computer network, may be
subject to civil liabilities and criminal penalties under applicable
state law. The Trust will advise all of its employees and agents who have
access to any BOSTON FINANCIAL Confidential Information or to any
computer equipment capable of accessing BOSTON FINANCIAL hardware or
software of the foregoing.
(3) The Trust acknowledges that disclosure of the BOSTON FINANCIAL
Confidential Information may give rise to an irreparable injury to BOSTON
FINANCIAL and/or its affiliates inadequately compensable in damages.
Accordingly, BOSTON FINANCIAL may seek (without the posting of any bond
or other security) injunctive relief against the breach of the foregoing
undertaking of confidentiality and nondisclosure, in addition to any
other legal remedies which may be available, and the Trust consents to
the obtaining of such injunctive relief. All of the undertakings and
obligations relating to confidentiality and nondisclosure, whether
contained in this
30
Section or elsewhere in this Agreement shall survive the termination or
expiration of this Agreement for a period of ten (10) years.
24. CHANGES AND MODIFICATIONS.
A. During the term of this Agreement BOSTON FINANCIAL will use on
behalf of the Trust without additional cost all modifications,
enhancements, or changes which BOSTON FINANCIAL or its affiliates may
make to the TA2000(TM) System in the normal course of its business and
which are applicable to functions and features offered by the Trust to
its shareholders, unless those BOSTON FINANCIAL clients having
substantially similar service and billing arrangements to the Trust are
charged separately for such modifications, enhancements or changes,
including, without limitation, substantial system revisions or
modifications necessitated by changes in existing laws, rules or
regulations. The Trust agrees to pay BOSTON FINANCIAL promptly for
modifications and improvements that are charged for separately at the
rate provided for in BOSTON FINANCIAL's standard pricing schedule, which
shall be identical for those BOSTON FINANCIAL clients which have
substantially similar service and billing arrangements to the Trust, if a
standard pricing schedule shall exist. If there is no standard pricing
schedule, the parties shall mutually agree upon the rates to be charged.
B. BOSTON FINANCIAL and/ or its affiliates shall have the right, at any
time and from time to time, to alter and modify any systems, programs,
procedures or facilities used or employed in performing its duties and
obligations hereunder; provided that the Trust will be notified as
promptly as possible prior to implementation of such alterations and
modifications and that no such alteration or modification or deletion
shall materially adversely change or affect the operations and procedures
of the Trust in using or employing the TA2000(TM) System or BOSTON
FINANCIAL Facilities hereunder or the reports to be generated by such
system and facilities hereunder, unless the Trust is given thirty (30)
days prior notice to allow the Trust to change its procedures and BOSTON
FINANCIAL provides the Trust with revised operating procedures and
controls.
C. All enhancements, improvements, changes, modifications or new
features added to the TA2000(TM) System however developed or paid for
shall be, and shall remain, the confidential and exclusive property of,
and proprietary to, BOSTON FINANCIAL and/or its affiliates.
25. ASSIGNMENT AND SUBCONTRACTORS.
A. Neither this Agreement nor any rights or obligations hereunder may
be assigned by either party hereto without the written consent of the
other party. In the event of a mutually agreed to assignment, each party
shall remain liable for the performance of its assignee(s). BOSTON
FINANCIAL may, however, employ agents to assist it in performing its
duties hereunder; provided, however, that BOSTON FINANCIAL shall be fully
responsible to the Trust for the acts and omissions of any agent employed
by it to the same extent as it is for its own acts and omissions and
BOSTON FINANCIAL shall
31
obtain the Trust's prior approval for the employment of any such agent
that is not an affiliate of BOSTON FINANCIAL.
B. Notwithstanding anything in this Agreement to the contrary, nothing
herein shall impose any duty upon BOSTON FINANCIAL in connection with or
make BOSTON FINANCIAL liable for the actions or omissions to act of
unaffiliated third parties such as, by way of example and not limitation,
Airborne Services, the U.S. mails, the National Securities Clearing
Commission and telecommunication companies, provided, if BOSTON FINANCIAL
selected such company, BOSTON FINANCIAL shall have exercised due care in
selecting the same.
26. LIMITATIONS ON LIABILITY.
A. Notwithstanding anything in this Agreement to the contrary, each
Trust that executed this Agreement is and shall be regarded for all
purposes hereunder as a separate party apart from each other Trust and
any Fund of any such other Trust. To the extent that a Trust is comprised
of more than one Fund, each Fund shall be regarded for all purposes
hereunder as a separate party apart from each other Fund. Unless the
context otherwise requires, with respect to every transaction covered by
this Agreement, every reference herein to the Trust shall be deemed to
relate solely to the particular Fund or Trust to which such transaction
relates. Under no circumstances shall the rights, obligations or remedies
with respect to a particular Trust or a particular Fund constitute a
right, obligation or remedy applicable to any other Trust or Fund. The
use of this single document to memorialize the separate agreement of each
Trust and each Fund herein is understood to be for clerical convenience
only and shall not constitute any basis for joining the Trusts or Funds
for any reason.
B Notice is hereby given that a copy of each Trust's Declaration of
Trust or Certificate of Trust and all amendments thereto is on file with
the Secretary of State of the state of its organization; that this
Agreement has been executed on behalf of the Trust by the undersigned
duly authorized representative of the Trust in his/her capacity as such
and not individually; and that the obligations of this Agreement shall
only be binding upon the assets and property of the Trust and shall not
be binding upon any trustee, officer or shareholder of the Trust
individually.
27. MISCELLANEOUS.
A. This Agreement shall be construed according to, and the rights and
liabilities of the parties hereto shall be governed by, the laws of the
Commonwealth of Massachusetts, excluding that body of law applicable to
choice of law.
B. All terms and provisions of this Agreement shall be binding upon,
inure to the benefit of and be enforceable by the parties hereto and
their respective successors and permitted assigns.
32
C. The representations and warranties, and the indemnification extended
hereunder, if any, are intended to and shall continue after and survive
the execution, expiration, termination or cancellation of this Agreement
or the performance of services hereunder until any statute of limitations
applicable to the matter at issues shall have expired.
D. No provisions of this Agreement may be amended or modified in any
manner except by a written agreement properly authorized and executed by
each party hereto.
E. The captions in this Agreement are included for convenience of
reference only, and in no way define or delimit any of the provisions
hereof or otherwise affect their construction or effect.
F. This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original but all of which together shall
constitute one and the same instrument.
G. If any part, term or provision of this Agreement is by the courts
held to be illegal, in conflict with any law or otherwise invalid, the
remaining portion or portions shall be considered severable and not be
affected, and the rights and obligations of the parties shall be
construed and enforced as if the Agreement did not contain the particular
part, term or provision held to be illegal or invalid.
H. Neither the execution nor performance of this Agreement shall be
deemed to create a partnership or joint venture by and between the Trust
and BOSTON FINANCIAL. It is understood and agreed that all services
performed hereunder by BOSTON FINANCIAL shall be as an independent
contractor and not as an employee of the Trust. This Agreement is between
BOSTON FINANCIAL and the Trust and neither this Agreement nor the
performance of services under it shall create any rights in any third
parties. There are no third party beneficiaries hereto.
I. Except as specifically provided herein, this Agreement does not in
any way affect any other agreements entered into among the parties hereto
and any actions taken or omitted by any party hereunder shall not affect
any rights or obligations of any other party hereunder.
J. The failure of either party to insist upon the performance of any
terms or conditions of this Agreement or to enforce any rights resulting
from any breach of any of the terms or conditions of this Agreement,
including the payment of damages, shall not be construed as a continuing
or permanent waiver of any such terms, conditions, rights or privileges,
but the same shall continue and remain in full force and effect as if no
such forbearance or waiver had occurred.
K. (a) During the term of this Agreement, the Trust hereby grants to
BOSTON FINANCIAL a nonexclusive, worldwide and royalty-free right and
license to store, reproduce, display, perform, transmit and use the Trust
intellectual property and the Trust software in connection with the
Services, solely for the purposes necessary for BOSTON FINANCIAL to
fulfill its obligations pursuant to this Agreement (and not for the
benefit of any third party). BOSTON FINANCIAL acknowledges and agrees
that its use of the
33
Trust intellectual property solely for the purposes necessary for BOSTON
FINANCIAL to fulfill its obligations pursuant to this Agreement shall not
create any right, title or interest in or to such the Trust intellectual
property. Except for the licenses expressly granted hereunder by the
Trust to BOSTON FINANCIAL, neither this Agreement nor any disclosure made
hereunder grants any license by the Trust to BOSTON FINANCIAL of any
Trust intellectual property.
(b) Except as may be otherwise expressly provided in this Agreement, the
Trust does not grant to BOSTON FINANCIAL any right or license, express or
implied, in or to the Trust intellectual property, the Trust software or
the Trust's operating environment. BOSTON FINANCIAL agrees that the Trust
and/or the Trust's licensors', as the case may be, are the exclusive
owners of, and hold and shall retain, all right, title and interest in
and to the Trust intellectual property, the Trust software, and the
trust's operating environment, and BOSTON FINANCIAL shall have no
ownership or use rights therein except as set forth herein.
L. Without the consent of the Trust, BOSTON FINANCIAL shall not use the
Trust's trade name, trademark, service xxxx or logo in BOSTON FINANCIAL's
public sales, marketing, or publicity activities including, but not
limited to, press releases, interviews with representatives of any
written publication, television station or network, or radio station or
network.
M. This Agreement constitutes the entire agreement between the parties
hereto and supersedes any prior agreement, draft or agreement or proposal
with respect to the subject matter hereof, whether oral or written, and
this Agreement may not be modified except by written instrument executed
by both parties.
N. All notices to be given hereunder shall be deemed properly given if
delivered in person or if sent by U.S. mail, first class, postage
prepaid, or if sent by facsimile and thereafter confirmed by mail as
follows: If to BOSTON FINANCIAL:
BOSTON FINANCIAL DATA SERVICES, INC.
The Xxxxxxxxxx Building
000 X. 0xx Xxxxxx
Xxxxxx Xxxx, Xxxxxxxx 00000
Attention: Xxxx Xxxxxxx
Facsimile:(000) 000-0000
With a copy of non-operational notices to:
BOSTON FINANCIAL DATA SERVICES, INC.
0 Xxxxxxxx Xxxxx - 0xx Xxxxx
Xxxxx Xxxxxx, XX 00000
Attn: Legal Department
Facsimile No.: 000 000-0000
34
If to the Trust:
or to such other address as shall have been specified in writing by the
party to whom such notice is to be given.
35
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by
their respective duly authorized officers, to be effective as of the day and
year first above written.
FUND
BY:----------------------------------------------
Title:-----------------------------
as an Authorized Officer on behalf of each
of the Funds indicated on Appendix A
BOSTON FINANCIAL DATA SERVICES, INC.
By: --------------------------------------
Title:-----------------------------------
36
EXHIBIT A
BOSTON FINANCIAL DATA SERVICES
FEE SCHEDULE
X.X. XXXXXX FUNDS
BOSTON FINANCIAL DATA SERVICES
FEE PROPOSAL
JPMORGAN FUNDS
EFFECTIVE: FUND MERGER - AUGUST 31, 2009
I. TRANSFER AGENCY
A. BASE FEES
Base Fee Per CUSIP (across the Fund Sponsor):
CUSIPS (including ACI) $3,335 per CUSIP per year
Closed CUSIPS - $150 per month through May of the following year
B. ACCOUNT MAINTENANCE AND PROCESSING FEES
Non-Institutional Non-Network Level 3 & 1 Open Accounts - $19.07 per
account per year
Non-Institutional Network Level 3 Open Accounts - $8.07 per account
per year
Non-Institutional Network Level 1 Open Accounts - $8.07 per account
per year Institutional Open Accounts:
Accounts in the range from 0 - 400: no charge, included in complex base fee
Accounts in the range from 401 - 600: $1,160 per account per year
Accounts in the range from 601 - 800: $930 per account per year
Accounts in the range from 801 - 1,000: $700 per account per year
Accounts in the range over 1,000: $580 per account per year
Closed Accounts - $2.09 per closed account per year
Non-Institutional Omnibus Transactions - $1.00 per transaction
-Includes all transactions processed in accounts within social
code 009,902,960
Institutional and Intermediary Phone Calls (Inbound & Outbound)
- $2.60 per call
C. OPTIONAL SERVICES
Investor - $1.80 per investor id
AML/CIP - $0.23 per open account per year
Universal Dealer - $150,000 per year - Includes conversion to
Universal Rep for combined fund family
Same Day Cash Management Projected Cash - $18,000 per year.
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D. Alternative Investment Funds: (Multi Strategy Fund, Spinnaker Fund)
Annual CUSIP:
S/T investment vehicle - $5,000 per fund per year
Investment Fund - $15,000 per fund per year
Manual Transactions:
S/T Investment Vehicle - N/A
Investment Fund- $5.00 per transaction
Phone Calls:
S/T Investment Vehicle - $2.60 per call
Investment Fund - $2.60 per call
Certificate Processing Fee:
S/T Investment Vehicle - N/A
Investment Fund - $5.50 per Certificate
E. Financial Intermediary Interface:
Automated:
First four funds - $19,780 per intermediary per year
Each additional fund - $3,490 per year
Manual/Partially Automated:
First four funds - $39,570 per intermediary per year
Each additional fund - $6,980 per year
Programming Rates (rates not subject to usual Boston Financial annual increases
provided the existing six dedicated COBOL resources and the existing five
dedicated Client Services resources are maintained during the term of this
agreement; additional resources would be priced at Boston Financials standard
rate at the time of the addition). BFDS would require a 30-day notification for
a reduction of programming support and a 60-day notification to increase the
programming support.
COBOL Programmer:
Dedicated Resources $140,400 per year each
Additional COBOL Programmers:
Dedicated Resources $150,000 per year each
Client Services:
Dedicated Resources $100,000 per year each
Business Analyst/Tester:
On-Request $125.00 per hour
Technical Programmer:
On-Request $160.00 per hour
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Insight Technical Support $60,000 per year (across the Fund Sponsor)
TRAC-2000 - under separate schedule
NOTES TO THE ABOVE FEE SCHEDULE
A. The above schedule does not include out of pocket expenses incurred by
Boston Financial on the Fund's behalf. Examples of out of pocket expenses
include but are not limited to Confirmation statements, Investor
statements, forms, postage, mailing services, records retention,
transcripts, telephone line and long distance charges, client remote
hardware, excess history, DST TA2000 Voice, Fan Web, Fan Mail, vision,
escheatment, state tax reporting, wire processing charges, same day cash
management, regulatory compliance, training, disaster recovery ($.20 per
account), magnetic tapes, printing, ACH bank charges, NSCC charges, proxy
processing, microfilm/microfiche, etc.
B. Service fees and out of pocket expenses are billed monthly. Fees or
out-of-pocket expenses are due within 60 days of the date of the original
invoice. The application of late charges shall be as set forth in the
Agreement.
C. NOTICE OF INTENT TO TERMINATE
Notice of 120 days is required by either party to terminate the
Transfer
Agency agreement.
D. ANNUAL CPI INCREASE
The fees and charges set forth in this fee schedule shall increase upon
each anniversary of this Agreement over the fees and charges during the
prior 12 months in an amount based on the annual percentage of change in
the Consumer Price Index (CPI-U) in the Kansas City, Missouri-Kansas
Standard Metropolitan Statistical Area, All Items, Base 1982-1984=100, as
last reported by the U.S. Bureau of Labor Statistics.
E. EARLY TERMINATION COSTS
The parties acknowledge that BOSTON FINANCIAL has made significant
concessions to XX Xxxxxx, including a substantial reduction in the Fees to be
paid by XX Xxxxxx for Services under the Agreement, partially in exchange for XX
Xxxxxx'x agreement to a longer term. Should XX Xxxxxx terminate the Agreement to
which this Exhibit A is attached prior to the end of its term, BOSTON FINANCIAL
will suffer damages in an amount difficult to calculate and uncertain in scope
and, accordingly, the parties have agreed that, as liquidated damages and not as
a penalty, in such event, BOSTON FINANCIAL shall be entitled to impose the
mutually agreed upon liquidated damages equal to the sum of the previous 12
months fees excluding Out of Pocket Charges. Notwithstanding the foregoing, in
the event that XX Xxxxxx terminates the Agreement during the last year of the
Initial Term, the foregoing early termination damages amount shall be calculated
as noted above but shall be subject to a pro rata reduction over the final
twelve months of the term depending on XX Xxxxxx'x actual deconversion date.
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F. Non-Institutional open account rates will be discounted as follows:
Accounts in the range of 1,150,000 - 1,500,000 10% discount
Accounts in the range of 1,500,001 - 2,000,000 15% discount
Accounts greater than 2,000,000 20% discount
G. As used herein, the term "XX Xxxxxx" is intended to refer, and shall be
deemed to refer, jointly and severally to the each Trust who has
executed, or on whose behalf there has been executed, the
Transfer Agency
Agreement between Boston Financial and each Trust pursuant to which
Boston Financial acts as transfer agent for and provides transfer agent
services to each such Trust to which this Fee Proposal is attached
(variously, the "Agreement", the "Agency Agreement" and the "
Transfer
Agency Agreement").
H. Institutional Accounts are defined as follows:
A. Non Level 3 Account
B. Excessive Traders equals four or more trades per month
C. Account must be in a dealer serviced by the KC Institutional Desk via
fax or phone.
D. TPA Traders
E. Relationship Level (i.e. Global Trust has 85 trades per day but in 85
different accounts. Accounts would be marked proportionate to the
number of trades per day.
F. Special Servicing Requirements -with approval from fund (i.e. M Shares
accounts)
G. Reports are produced each month allocated by Fund. Account totals are
provided to the client each month.
Agreed to by:
------------------------------------ -----------------------------
Boston Financial Data Services, Inc. XX Xxxxxx Funds
------------------------------------ -----------------------------
Date Date
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