RECORDKEEPING AGREEMENT
THIS AGREEMENT made as of this 14th day of June, 1995, by and between
PILGRIM AMERICA MASTERS SERIES, INC., a Maryland corporation, having its
principal place of business at Two Renaissance Square, 00 Xxxxx Xxxxxxx Xxxxxx,
Xxxxx 0000, Xxxxxxx, Xxxxxxx 00000 ("Fund"), and INVESTORS FIDUCIARY TRUST
COMPANY, a state chartered trust company organized and existing under the laws
of the State of Missouri, having its principal place of business at 000 Xxxx
00xx Xxxxxx, Xxxxxx Xxxx, Xxxxxxxx, 00000 ("IFTC"):
WITNESSETH: In consideration of the mutual promises herein contained, the
parties hereto, intending to be legally bound, mutually covenant and agree as
follows:
1. Appointment of Recordkeeping Agent
Fund hereby constitutes and appoints IFTC as Recordkeeping Agent for all
existing and any future series of the Fund (the "Portfolios") to perform
certain accounting and recordkeeping functions related to portfolio
transactions required of Fund as a registered investment company in
compliance with Rule 31a of the Investment Company Act of 1940 ("1940 Act")
and to calculate daily each Portfolio's net asset value.
2. Representations and Warranties of Fund
A. Fund represents and warrants that it is a corporation duly organized
as heretofore described and existing and in good standing under the
laws of Maryland.
B. Fund represents and warrants that it has the power and authority under
applicable laws, its articles of incorporation and bylaws, and has
taken all action necessary, to enter into and perform this Agreement.
C. Fund represents and warrants that it has determined that the
computerized recordkeeping system to be used by IFTC in maintaining
accounting records of Fund hereunder (the "Portfolio Accounting
System") is appropriate and suitable for Fund's needs.
D. Fund shall preserve the confidentiality of the Portfolio Accounting
System and the tapes, books, reference manuals, instructions, records,
programs, documentation and information of, and other materials
relevant to, the Portfolio Accounting System and the business of IFTC
("Confidential Information"). Fund shall not voluntarily disclose such
Confidential Information to any other person other than its own
employees who reasonably have a need to know such information pursuant
to this Agreement. Fund shall return all such Confidential Information
to IFTC upon termination or expiration of this Agreement.
E. Fund has been informed that the Portfolio Accounting System is
licensed for use by IFTC from DST Systems, Inc. ("Licensor"), and Fund
acknowledges that IFTC and Licensor have proprietary rights in and to
the Portfolio Accounting System and all other IFTC or Licensor
programs, code, techniques, know-how, data bases, supporting
documentation, data formats and procedures, including without
limitation any changes or modifications made at the request or expense
or both of Fund (collectively, the "Protected Information"). Fund
acknowledges that the Protected Information constitutes confidential
material and trade secrets of IFTC and Licensor. Fund shall preserve
the confidentiality of the Protected Information, and Fund hereby
acknowledges that any unauthorized use, misuse, disclosure or taking
of Protected Information, 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 law. Fund shall so
inform employees and agents who have access to the Protected
Information or to any computer equipment capable of accessing the
same. Licensor is intended to be and shall be a third party
beneficiary of the Fund's obligations and undertakings contained in
this paragraph.
F. If IFTC shall provide Fund direct access to the Portfolio Accounting
System or if IFTC and Fund shall agree to utilize any electronic
system of communication, Fund shall be fully responsible for any and
all consequences of the use or misuse of the terminal device,
passwords, access instructions and other means of access to such
system(s) which are utilized by, assigned to or otherwise made
available to the Fund. Fund agrees to implement and enforce
appropriate security policies and procedures to prevent unauthorized
or improper access to or use of such system(s). IFTC shall be fully
protected in acting hereunder upon any instructions, communications,
data or other information received by IFTC by such means as fully and
to the same effect as if delivered to IFTC by written instrument
signed by the requisite authorized representative(s) of the Fund. Fund
shall indemnify and hold IFTC harmless from and against any and all
costs, expenses, losses, liabilities, damages, charges and counsel
fees which may be asserted against or incurred by IFTC as a
consequence of the use or misuse, whether authorized or unauthorized,
of the Portfolio Accounting System or other computerized recordkeeping
and reporting system to which IFTC provides Fund direct access
hereunder or of any other electronic system of communication used
hereunder by Fund or by any person who acquires access to such
system(s) through the terminal device, passwords, access instructions
or other means of access to such system(s) which are utilized by,
assigned to or otherwise made available to the Fund, except to the
extent attributable to any negligence or willful misconduct by IFTC.
3. Representation and Warranties of IFTC
A. It is a trust company duly organized and existing and in good standing
under the laws of the State of Missouri.
B. It has the requisite power and authority under applicable laws, by its
charter and bylaws, and by agreement to enter into this Agreement and
has taken all action necessary to enter into and perform the services
contemplated herein and this Agreement has been duly executed and
delivered by IFTC and constitutes a legal, valid and binding
obligation of IFTC, enforceable in accordance with its terms.
4. Duties and Responsibilities of IFTC
A. Fund shall turn over to IFTC all of Fund's accounts and records
previously maintained. IFTC shall be entitled to rely conclusively on
the completeness and correctness of the accounts and records turned
over to it by Fund and Fund shall indemnify and hold IFTC harmless of
and from any and all expenses, damages and losses whatsoever arising
out of or in connection with any error, omission, inaccuracy or other
deficiency of such accounts and records or in the failure of Fund to
provide any portion of such or to provide in a timely manner any other
information needed by IFTC to perform its function hereunder.
B. Accounts and Records
1. IFTC, with the direction and as interpreted by the Fund or Fund's
accountants and/or other advisors, will prepare and maintain in
complete, accurate, and current form all accounts and records
needed to be maintained as a basis for calculation of each
Portfolio's net asset value and as further agreed upon by the
parties in writing, and will preserve such records in the manner
and for the periods required by the 1940 Act or such longer
period as the parties may agree upon in writing.
2. Unless the information necessary to perform the above functions
is furnished in writing or its electronic or digital equivalent
to IFTC prior to the next close of the New York Stock Exchange
and calculation of the Portfolio's net asset values, IFTC shall
incur no liability and the Fund shall indemnify and hold IFTC
harmless from and against any liability in connection therewith.
3. It shall be the responsibility of Fund to furnish IFTC with the
declaration, record and payment dates and amounts of any
dividends or income and any other special actions required
concerning the securities in the portfolio when such information
is not readily available from generally accepted securities
industry services or publications.
4. The accounts and records maintained and preserved by IFTC shall
be the property of the Fund and shall be made available to the
Fund for inspection or reproduction within a reasonable time,
upon demand.
5. IFTC shall assist Fund's independent accountants, or upon
approval of Fund or upon demand, any regulatory body, in any
requested review of Fund's accounts and records maintained by
IFTC but shall be reimbursed by Fund for all expenses and
employee time invested in any such review outside of routine and
normal periodic reviews.
6. Upon receipt from Fund of any necessary information, IFTC shall
provide information from the books and records it maintains for
Fund that Fund needs for tax returns, questionnaires, or periodic
reports to shareholders and such other reports and information
requests as Fund and IFTC shall agree upon from time to time.
7. IFTC and Fund may from time to time adopt procedures as they
agree upon, and IFTC may conclusively assume that any procedure
approved by Fund, or directed by Fund, does not conflict with or
violate any requirements of Fund's prospectus, declaration of
trust, bylaws, or any rule or regulation of any applicable
regulatory body or governmental agency. Fund shall be responsible
to notify IFTC of any changes in statutes, rules, requirements,
or policies which may necessitate changes in IFTC's
responsibilities or procedures.
8. IFTC will calculate each Portfolio's net asset value in
accordance with the Fund's prospectus once daily. IFTC will price
the securities and foreign currency holdings of the Portfolios
for which market quotations are available by the use of outside
services designated by Fund which are normally used and
contracted with for this purpose; all other securities and
foreign currency holdings will be priced in accordance with
Fund's instructions.
5. Limitation of Liability of IFTC
A. IFTC shall not be responsible or liable for, and Fund shall indemnify
and hold IFTC harmless from and against, any loss or liability arising
out of IFTC's action or omission to act pursuant hereto, except for
any loss or damage arising from any negligent act or willful
misconduct of IFTC. IFTC shall indemnify and hold harmless Fund from
and against any loss or liability arising from such negligence or
willful misconduct. The Fund agrees to minimize any potential monetary
loss(es) by reprocessing shareholder transactions or employing any
other customary procedures to reduce such monetary loss(es). Neither
party shall be liable to the other for consequential, special, or
punitive damages. IFTC may request and obtain the advice and opinion
of counsel for Fund or its own counsel at the expense of Fund with
respect to questions or matters of law, and it shall be without
liability to Fund for any action taken or omitted by it in good faith,
in conformity with such advice or opinion.
B. IFTC may rely upon the advice and statements of Fund, its distributor,
its management company and its accountants, officers and other
authorized individuals (as provided by corporate resolution to IFTC)
and others believed by it in good faith to be expert in matters upon
which they are consulted. Actions or inaction taken in reliance on
such advice and statements shall not be considered "negligent" and
IFTC shall not be liable for any actions taken in good faith upon such
advice and statements.
C. If Fund requests IFTC in any capacity to take any action which
involves the payment of money by it, or which in IFTC's opinion might
make it liable for payment of money or in any other way, IFTC shall be
and be kept indemnified by Fund in an amount and form satisfactory to
IFTC against any liability on account of such action; provided,
however that IFTC shall not be obligated to expend its own moneys or
to take any such action except in IFTC's sole discretion.
D. IFTC shall be entitled to receive and Fund agrees to pay to IFTC, on
demand, reimbursement for such cash disbursements, costs and expenses
as may be agreed upon in writing from time to time by IFTC and Fund.
E. IFTC shall be protected in acting hereunder upon any instructions,
advice, notice, request, consent, certificate or other instrument or
paper appearing to it to be genuine and to have been properly executed
and shall, unless otherwise specifically provided herein, be entitled
to receive as conclusive proof of any fact or matter required to be
ascertained from Fund as determined by IFTC, instructions or a
certificate signed by Fund's President or other officer of Fund as
requested by IFTC.
F. Without limiting the generality of the foregoing, IFTC shall be under
no duty or obligation to inquire into, and shall not be liable for:
1. The validity of the issue of any securities purchased by or for
Fund, or the legality of the purchase thereof;
2. The legality of the sale of any securities by or for Fund, or the
propriety of the amount for which the same are sold;
3. The legality of the issue or sale of any shares of Fund, or the
sufficiency of the amount to be received therefore;
4. The legality of the purchase of any shares of Fund, or the
propriety of the amount to be paid therefore; or
5. The legality of the declaration of any dividend by Fund, or the
legality of the issue of any shares of Fund in payment of any
dividend.
G. IFTC shall not be liable for, or considered to be the custodian of,
any money represented by any check, draft, wire transfer, clearing
house funds, uncollected funds, or instrument for the payment of money
received by it on behalf of Fund, until IFTC actually receives such
money, provided only that it shall advise Fund promptly if it fails to
receive any such moneys in the ordinary course of business, and use
reasonable efforts and cooperate with Fund toward the end that such
money shall be received.
H. Notwithstanding anything herein to the contrary, it is expressly
understood and agreed that IFTC shall have no responsibility to Fund,
the Fund's shareowners or any other person or entity for moneys or
securities of Fund held by banks or trust companies as custodians in
the absence of negligence or willful misconduct of IFTC.
I. IFTC shall not use any information made available to it under the
terms of this Agreement for any purpose other than complying with its
duties and responsibilities under this Agreement or as specifically
authorized by Fund in writing to IFTC.
6. Force Majeure
IFTC shall not be responsible or liable for any 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
of any utility, transportation, computer (hardware or software) or
communication service; or inability to obtain labor, material, equipment or
transportation; nor shall any such failure or delay give Fund any
additional right to terminate this Agreement.
7. Additional Funds
IFTC shall act as recordkeeper for additional Portfolios of Fund upon 30
days notice to IFTC provided IFTC consents to such arrangement. Rates or
charges for such additional Portfolios shall be as agreed by IFTC and Fund
in writing.
8. Compensation
Fund shall pay to IFTC such compensation at such time as may from time to
time be agreed upon in writing by IFTC and Fund. Fund shall also reimburse
IFTC for all out-of-pocket expenses incurred by IFTC in connection with
services performed pursuant to this Agreement.
9. Procedures. IFTC and Fund may from time to time adopt procedures as they
agree upon, and IFTC may conclusively assume that any procedure approved or
directed by Fund or its accountants or other advisors does not conflict
with or violate any requirements of Fund's prospectus, articles of
incorporation, bylaws, any applicable law, rule or regulation, or any
order, decree or agreement by which the Fund may be bound.
10. Termination. This Agreement shall continue in effect until terminated by
either party by notice in writing received by the other party not less than
ninety (90) days prior to the date upon which such termination shall take
effect. Upon termination of this Agreement:
A. Fund shall pay to IFTC its fees and compensation due hereunder and its
reimbursable disbursements, costs and expenses paid or incurred to
such date.
B. Fund shall designate a successor (which may be Fund) by notice in
writing to IFTC on or before the termination date.
C. IFTC shall deliver to the successor, or if none has been designated,
to Fund, at IFTC's office, all records, funds and other properties of
Fund deposited with or held by IFTC hereunder. In the event that
neither a successor nor Fund takes delivery of all records, funds and
other properties of Fund by the termination date, IFTC's sole
obligation with respect thereto from the termination date until
delivery to a successor or Fund shall be to exercise reasonable care
to hold the same in custody in its form and condition as of the
termination date, and IFTC shall be entitled to reasonable
compensation therefor, including but not limited to all of its
out-of-pocket costs and expenses incurred in connection therewith.
11. Notices
Notices, requests, instructions and other writings received by Fund at Two
Rennaissance Square, 00 Xxxxx Xxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxx
00000, or at such address as Fund may have designated to IFTC in writing,
shall be deemed to have been properly given to Fund hereunder; and notices,
requests, instructions and other writings received by IFTC at its offices
at 000 Xxxx 00xx Xxxxxx, Xxxxxx Xxxx, XX 00000, or to such other address as
it may have designated to Fund in writing, shall be deemed to have been
properly given to IFTC hereunder.
12. Miscellaneous
A. This Agreement is executed and delivered in the State of Missouri and
shall be governed by the laws of said state.
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.
C. No provisions of the Agreement may be amended or modified in any
manner except by a written agreement properly authorized and executed
by both parties hereto.
D. The captions in the Agreement are included for convenience of
reference only, and in no way define or limit any of the provisions
hereof or otherwise affect their construction or effort.
E. 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.
F. If any part, term or provision of this Agreement is determined 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.
G. This Agreement may not be assigned by either party without prior
written consent in writing of the other party.
H. The representations and warranties, the indemnification extended
hereunder, and the provisions of Section 2.D. and 2.E. are intended to
and shall continue after and survive the expiration, termination or
cancellation of this Agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
by their respective and duly authorized corporate or trust officers.
INVESTORS FIDUCIARY TRUST COMPANY
By: _________________________________
Title: ______________________________
PILGRIM AMERICA MASTERS SERIES, INC.
By: _________________________________
Title: ______________________________
