INFORMATION SHARING AGREEMENT
This Information Sharing Agreement (the "Agreement"), entered into as
of October 16, 2006, or such later date as the SEC may designate by which mutual
funds must be in compliance with SEC Rule 22c-2 under the 1940 Act, by and
between Royce Fund Services, Inc. ("RFS") and Security Distributors, Inc.
("Financial Intermediary"), confirms an agreement between the parties for the
sharing of transaction information relating to any and all series of Royce
Capital Fund (each a "Fund") that may be offered by Financial Intermediary from
time to time.
WHEREAS, Financial Intermediary and RFS, Royce & Associates, LLC and/or
the Fund have entered into either a Dealer Agreement, Services Agreement, Order
Placement Procedures Agreement or similar agreement (each a "Dealer Agreement")
whereby the Financial Intermediary is authorized to receive orders for the
purchase, exchange and redemption ("Orders") of shares of certain of the Funds
("Shares") on behalf of the Financial Intermediary's clients ("Clients");
WHEREAS, "Clients" shall also refer to (i) the beneficial owner of
Shares, whether the Shares are held directly or by the Financial Intermediary in
nominee name, (ii) participants in qualified employee benefit plan or plans
(each a "Plan") notwithstanding that the Plan may be deemed to be the beneficial
owner of Shares, and (iii) the holder of interests in a variable annuity or
variable life insurance contract issued by the Financial Intermediary; and
WHEREAS, RFS has requested that Financial Intermediary enter into this
Agreement with respect to the implementation and compliance with SEC Rule 22c-2
under the 1940 Act.
NOW THEREFORE, in consideration of the mutual premises herein, the
parties hereto, intending to be legally bound, hereby agree as follows:
1. Agreement to Provide Information. Financial Intermediary agrees to provide to
RFS or its designee, upon written request, the taxpayer identification number
("TIN"), if known, of any or all Clients of the account. Financial Intermediary
also agrees to provide the number of shares, dollar value, date, name or other
identifier (including broker identification number) of any investment
professional(s) associated with the Client(s) or account (if known), and
transaction type (purchase, redemption, transfer or exchange) of every purchase,
redemption, transfer, or exchange of Shares held through an account maintained
by Financial Intermediary during the period covered by the request. Requests
must set forth a specific period, generally not to exceed 90 days from the date
of the request, for which transaction information is sought. RFS or its designee
may request transaction information older than 90 days from the date of the
request as it deems reasonably necessary to investigate compliance with policies
established by the Fund for the purpose of eliminating or reducing any dilution
of the value of the outstanding shares issued by the Fund.
Financial Intermediary agrees to transmit the requested information
that is on its books and records to RFS or its designee promptly, but in any
event not later than five (5) business days, or as otherwise agreed to by the
parties, after receipt of a request. If the requested information is not on the
Financial Intermediary's books and records, Financial Intermediary agrees to (i)
provide or arrange to provide to the Fund the requested information pertaining
to shareholders who hold accounts with an indirect intermediary; or (ii) if
directed by RFS, block further purchases of Shares from such indirect
intermediary. In such instance, Financial Intermediary agrees to inform RFS
whether it plans to perform (i) or (ii). Responses required by this paragraph
must be communicated in writing and in a format mutually agreed upon by the
parties. To the extent practicable, the format for any transaction information
provided to RFS should be consistent with the NSCC Standardized Data Reporting
Format. For purposes of this provision, an "indirect intermediary" has the same
meaning as in SEC Rule 22c-2 under the 1940 Act.
2. Limitations on Use of Information. RFS agrees not to use the information
received for marketing or any other similar purpose without the prior written
consent of Financial Intermediary.
3. Agreement to Restrict Trading. Financial Intermediary agrees to execute
written instructions from RFS to restrict or prohibit further purchases
(including shares acquired by exchanges) of Shares by a Client that has been
identified by RFS or its designee as having engaged in transactions in the
Shares (directly or indirectly through the Intermediary's account) that violates
policies established by the Fund.
4. Form of Instructions. Instructions must include the TIN, if known, and the
specific restriction(s) to be executed. If the TIN is not known, the
instructions must include an equivalent identifying number of the Client(s) or
account(s) or other agreed upon information to which instruction relates.
5. Timing of Response. Financial Intermediary agrees to execute instruction as
soon as practicable, but not later than five (5) business days, or as otherwise
agreed to by the parties, after receipt of the instructions by the Intermediary.
6. Confirmation of Financial Intermediary. Financial Intermediary must provide
written confirmation to RFS that instructions have been executed. Intermediary
agrees to provide confirmation as soon as reasonably practicable, but not later
than ten (10) business days after the instructions have been executed.
7. Dealer Agreement. All of the provisions of the Dealer Agreement by and
between RFS, Royce & Associates, LLC and/or the Fund and Financial Intermediary
shall remain in full force and effect. To the extent the Dealer Agreement and
this Agreement are inconsistent, this Agreement shall govern.
8. Term. This Agreement shall remain in effect until the earlier of such time as
(a) the Dealer Agreement has been terminated and is no longer in effect between
the two
parties or (b) SEC Rule 22c-2 is no longer in effect. Notwithstanding the
foregoing, the provisions of Section 2 shall survive termination of this
Agreement.
9. Assignment. There may be no assignment (as defined in the 0000 Xxx) of this
Agreement without the consent of the other party.
IN WITNESS WHEREOF, the undersigned has caused this Agreement to be
executed as of the date first above written.
ROYCE FUND SERVICES, INC. SECURITY DISTRIBUTORS, INC.
By:__________________________ By:________________________
Name: Xxxx X. Xxxxxxxxx Name: _____________________
Title: President Title: ____________________
ROYCE FUND SERVICES, INC.
POST CONTRACT IMPLEMENTATION FOR RULE 22C-2 AGREEMENTS
22C-2 OPERATIONS CONTACTS AND OPERATIONAL OVERVIEW
Royce Fund Services, Inc. ("RFS") as distributor for The Royce Fund and Royce
Capital Fund will be taking a risk based approach to oversight of frequent
trading under SEC Rule 22c-2. By a "risk based" approach we mean that we will
monitor accounts for activity that exceeds certain thresholds and when certain
trigger conditions are met we will request information from you.
RFS OPERATIONAL CONTACTS:
Xxxxx Xxxxxx xxxxx@xxxxxxxxxx.xxx
Director of Mutual Fund Operations 000-000-0000
Xxxxxxx Xxxxxx xxxxxxx@xxxxxxxxxx.xxx
Operations Manager 000-000-0000
TRADING REVIEW
LEVEL 3 DEALERS:
RFS will use transaction data from transfer agent records for review.
We may require additional information such as Taxpayer Identification
Number (TIN) on specific accounts under review and will work with you
to obtain this.
BROKER/DEALER OMNIBUS:
For broker dealers providing enhanced sales reporting data with similar
information to the DTCC Standardized Data Reporting, RFS will use those
daily files for review. We may require additional information (such as
TIN) on specific accounts under review if not provided on the sales
reporting files.
TPA AND OTHER OMNIBUS ACCOUNTS:
RFS will be using DTCC's Standardized Data Reporting and other existing
links to request and receive trade level detail required to meet our
review obligations. For super-omnibus accounts, we may request daily
files to get plan level detail. All other requests will be made based
on our risk based review model.
ACTIONS AS A RESULT OF REVIEW
RFS will advise intermediary of any accounts that are subject to warning or
restriction from further activity.
Please complete and return this page by fax to RFS at:
212-832-8921
INTERMEDIARY OPERATIONAL CONTACT FOR 22C-2
Please advise contact information for:
Date: _______________________________________
Intermediary Name: _______________________________________
Post Contract Implementation of Data File Requests:
Name: ______________________________________
Phone: ______________________________________
E-Mail: ______________________________________
Ongoing Contact for Warnings, Restrictions, etc:
Name: ______________________________________
Phone: ______________________________________
E-Mail: ______________________________________
