Exhibit (h)(ix) under Form N-1A
Exhibit 10 under Item 601/Reg S-K
TRANSFER AGENCY AND SERVICE AGREEMENT
BETWEEN
EACH OF THE FEDERATED FUNDS LISTED ON EXHIBIT A HERETO
AND
STATE STREET BANK AND TRUST COMPANY
2
TABLE OF CONTENTS
Page
1. Definitions ...........................................................1
2. Terms of Appointment and Duties........................................3
3. Fees and Expenses.....................................................11
4. Representations and Warranties of the Transfer Agent..................12
5. Representations and Warranties of the Fund............................12
6. Wire Transfer Operating Guidelines/Article 4A.........................13
7. Data Access and Proprietary Information...............................14
8. Indemnification.........................................................
16
9. Standard of Care/Limitation of Liability..............................17
10. Fund Confidential Information.........................................18
11. Covenants of the Fund and the Transfer Agent..........................19
12. Termination of Agreement..............................................20
13. Assignment and Third Party Beneficiaries..............................22
14. Subcontractors..........................................................
22
15. Miscellaneous...........................................................
23
16. Additional Funds......................................................24
17. Limitation of Liabilities of Trustees and Shareholders of the Fund....24
EXHIBIT A Federated Funds
EXHIBIT B Uncertificated Securities Account Control Agreement
SCHEDULE A Federated Funds
SCHEDULE 2.1 Service Level Standards
SCHEDULE 2.2(f) AML Delegation
SCHEDULE 2.2(g) Checkwriting Services Support
SCHEDULE 2.2(h) Debit Card Services/ACH Transactions Support
SCHEDULE 2.4 Functional Matrix
SCHEDULE 3.1 Fees
SCHEDULE 3.2 Out-Of-Pocket Expenses
27
1
TRANSFER AGENCY AND SERVICE AGREEMENT
AGREEMENT made as of the 1st day of July, 2004 (the "Agreement"), by
and between each entity that has executed this agreement, as listed on the
signature pages hereto, each company having its principal place of business
at 0000 Xxxxxxxxx Xxxxx, Xxxxxxxxxx, Xxxxxxxxxxxx 00000, collectively, (the
"Fund"), and STATE STREET BANK AND TRUST COMPANY, a Massachusetts trust
company having its principal office and place of business at 000 Xxxxxxxx
Xxxxxx, Xxxxxx, XX 00000 (the "Transfer Agent"). This Agreement shall be
considered a separate agreement between the Transfer Agent and each Fund and
references to "the Fund" shall refer to each Fund separately. No Fund shall
be liable for the obligations of, nor entitled to the benefits of, any other
Fund under this agreement.
WHEREAS, the Fund is authorized to issue shares in separate series,
with each such series representing interests in a separate portfolio of
securities and other assets;
WHEREAS, the Fund offers shares in various series, such series shall be
named in the attached Schedule A which may be amended by the parties from
time to time (each such series and all classes thereof, together with all
other series and all classes thereof subsequently established by the Fund and
made subject to this Agreement in accordance with Section 16, being herein
referred to as a "Portfolio", and collectively as the "Portfolios"); and
WHEREAS, the Fund, on behalf of the Portfolios, desires to appoint the
Transfer Agent as its transfer agent, dividend disbursing agent and agent in
connection with certain other activities, and the Transfer Agent desires to
accept such appointment.
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
the parties hereto agree as follows:
1. Definitions
"Affiliate" has the meaning set forth in Rule 12b-2 of the regulations
promulgated under the Securities Exchange Act.
"Agreement" shall have the meaning ascribed thereto in the preamble to
this Agreement.
"AML" shall have the meaning ascribed thereto in Section 2.2(f) hereof.
"AML Program" shall have the meaning ascribed thereto in Section 2.2(f)
hereof.
"Annual Report" shall have the meaning ascribed thereto in Section 2.5
hereof.
"Applicable Law" shall have the meaning ascribed thereto in Section 2.1
hereof.
"Bank" shall mean State Street Bank and Trust Company, acting in its
capacity as a bank only for purposes of Section 6.8 hereof.
"Board" shall have the meaning ascribed thereto in Section 2.1 hereof.
"Boston Financial" shall have the meaning ascribed thereto in Section
14.1 hereof.
"Chief Compliance Officer" shall have the meaning ascribed thereto in
Section 2.5 hereof.
"Custodian" shall have the meaning ascribed thereto in Section
2.1(A)(1) hereof.
"Data Access Services" shall have the meaning ascribed thereto in
Section 7.1 hereof.
"Deconversion" shall have the meaning ascribed thereto in Section 12.2
hereof.
"Delegated Duties" shall have the meaning ascribed thereto in Schedule
2.2(f) hereto.
"Disclosure Documents" shall have the meaning ascribed thereto in
Section 2.1(E)(4) hereof.
"Distribution Payment Date" shall have the meaning ascribed thereto in
Section 2.1(C)(1) hereof.
"Fee Schedule" shall have the meaning ascribed thereto in Section 3.1
hereof.
"Functional Matrix" shall have the meaning ascribed thereto in Section
2.4 hereof.
"Fund" and "Funds" shall have the meanings ascribed thereto in the
preamble to this Agreement.
"Fund Confidential Information" shall have the meaning ascribed thereto
in Section 10.1 hereof.
"Fund/SERV" shall have the meaning ascribed thereto in Section 2.2(c)
hereof.
"Good Purchase Orders" shall have the meaning ascribed thereto in
Section 2.1(A)(1) hereof.
"Good Redemption Orders" shall have the meaning ascribed thereto in
Section 2.1(B)(1) hereof.
"Good Transfer/Exchange Orders" shall have the meaning ascribed thereto
in Section 2.1(B)(3) hereof.
"Initial Term" shall have the meaning ascribed thereto in Section 12.1
hereof.
"IRAs" shall have the meaning ascribed thereto in Section 2.3 hereof.
"NAV" shall mean the net asset value per share of a Fund.
"Networking" shall have the meaning ascribed thereto in Section 2.2(c)
hereof.
"Next Calculated NAV" shall mean the NAV next calculated by each Fund's
fund accountant after receipt by Transfer Agent (or any agent of the
Transfer Agent or Funds identified in the registration statement of
such Fund or in Proper Instructions (each, a "22c-1 Agent")) of a (i)
Good Purchase Order or (ii) Good Redemption Order, as applicable.
"NSCC" shall have the meaning ascribed thereto in Section 2.2(c) hereof.
"OFAC" shall have the meaning ascribed thereto in Schedule 2.2(f)
hereto.
"Oral Instruction" shall have the meaning ascribed thereto in Section
2.1 hereof.
"Policies" shall have meaning ascribed thereto in Section 2.5 hereof.
"Portfolio" shall have the meaning ascribed thereto in the preamble to
this Agreement.
"Prior Transfer Agent" shall have the meaning ascribed thereto in
Section 2.4 hereof.
"Processing Guidelines" shall have the meaning ascribed thereto in
Section 2.1(A)(1) hereof
"Proper Instructions" shall have the meaning ascribed thereto in
Section 2.1 hereof.
"Prospectus" shall have the meaning ascribed thereto in Section 2.1
hereof.
"Recordkeeping Agreement" shall have the meaning ascribed thereto in
Section 2.1(F)(4) hereof.
"Renewal Term" shall have the meaning ascribed thereto in Section 12.1
hereof.
"Retirement Accounts" shall have the meaning ascribed thereto in
Section 2.3 hereof.
"SAR" shall have the meaning ascribed thereto in Schedule 2.2(f) hereto.
"Security Procedure" shall have the meaning ascribed thereto in Section
6.1 hereof.
"Service Level Standards" shall have the meaning ascribed thereto in
Section 2.1 hereof.
"Shares" shall have the meaning ascribed thereto in Section 2.1 hereof.
"Shareholders" shall have the meaning ascribed thereto in Section 2.1
hereof.
"Super Sheet" shall have the meaning ascribed thereto in Section 2.2(b)
hereof.
"TA 2000 System" shall have the meaning ascribed thereto in Section
2.2(c) hereof.
"Term" shall have the meaning ascribed thereto in Section 12.1 hereof.
"TIN" shall have the meaning ascribed thereto in Schedule 2.2(f) hereto.
"Transfer Agent" shall have the meaning ascribed thereto in the
preamble to this Agreement.
"Transfer Agent Proprietary Information" shall have the meaning
ascribed thereto in Section 7.1 hereof.
"USA PATRIOT Act" shall have the meaning ascribed thereto in Schedule
2.2(f) hereto.
2. Terms of Appointment and Duties
2.1 Transfer Agency Services. Subject to the terms and conditions set
forth in this Agreement, the Fund, on behalf of its respective
Portfolios, hereby employs and appoints the Transfer Agent to act as,
and the Transfer Agent agrees to act as, its transfer agent for the
Fund's authorized and issued shares of its common stock or beneficial
interest, as applicable ("Shares"), dividend disbursing agent and agent
in connection with any accumulation, open-account or similar plan
provided to the shareholders of each of the respective Portfolios of
the Fund ("Shareholders") and set out in the currently effective
prospectus and statement of additional information of the Fund, on
behalf of the Portfolio, as the same may be modified or amended from
time to time and provided by the Fund to the Transfer Agent
("Prospectus"), including without limitation any periodic investment
plan or periodic withdrawal program and in connection therewith, to
perform the following services in accordance with (i) Proper
Instructions, (ii) federal and state laws, rules and regulations
applicable to the performance of the services enumerated in Sections
2.1 through 2.6 and Sections 6.1 through 6.9 hereof (together with any
incorporated Schedules and/or Exhibits) and/or to which Transfer Agent
is subject ("Applicable Law"), (iii) the terms of the Prospectus of
each Fund or Portfolio, as applicable, and (iv) the service level
standards set forth in Schedule 2.1 attached hereto (the "Service Level
Standards"). When used in this Agreement, the term "Proper
Instructions" shall mean a writing signed or initialed by one or more
persons as shall have been authorized from time to time by the board of
directors/trustees of each Fund (the "Board") and with respect to which
a written confirmation of such authorization shall have been filed with
the Transfer Agent by the Fund. Each such writing shall set forth the
specific transaction or type of transaction involved. Oral
instructions ("Oral Instructions") will be deemed to be Proper
Instructions if (a) they otherwise comply with the definition thereof
and (b) the Transfer Agent reasonably believes them to have been given
by a person authorized to give such instructions with respect to the
transaction involved. The Fund shall promptly confirm all Oral
Instructions or cause such Oral Instructions given by a third party who
is authorized to give such Oral Instructions, to be promptly confirmed
in writing. Proper Instructions may include communications effected
through electro-mechanical or electronic devices. Proper Instructions,
oral or written, may only be amended or changed in writing, including
without limitation through electro-mechanical or electronic device.
A. Purchases
(1)The Transfer Agent shall receive orders and payment for the
purchase of Shares and, with respect to orders and payment
which are in good order ("Good Purchase Orders") according to
the then current processing guidelines of the Transfer Agent,
as the same may be changed from time to time upon provision of
a revised version thereof to the administrator of the Fund
(the "Processing Guidelines"), promptly deliver the payments
received therefor to the custodian of the relevant Fund (the
"Custodian"), for credit to the account of such Fund. The
Transfer Agent shall notify each Custodian, on a daily basis,
of the total amount of Good Purchase Orders received. Orders
which are not Good Purchase Orders will be promptly rejected
by the Transfer Agent, absent Proper Instructions to the
contrary, and the Shareholder or would-be Shareholder, as
applicable, will be promptly notified of such action.
(2)Subject to the deduction of any front-end sales charge,
where applicable, as the Transfer Agent is instructed in
accordance with the provisions of subsection 2.1(A)(3) hereof,
but based upon the Next Calculated NAV, the Transfer Agent
shall compute and issue the appropriate number of Shares of
each Fund and/or Class and credit such Shares to the
appropriate Shareholder accounts.
(3)The Transfer Agent shall deduct, and remit to the
appropriate party according to Proper Instructions, all
applicable sales charges according to (i) the Prospectus of the
Fund, (ii) the relevant information contained in any Good
Purchase Orders, and (iii) Proper Instructions, as applicable.
B. Redemptions, Transfers and Exchanges
(1) The Transfer Agent shall receive redemption requests and,
with respect to requests which are in good order according to
the Processing Guidelines ("Good Redemption Orders"), promptly
deliver the appropriate instructions therefor to the
Custodian. The Transfer Agent shall notify each Custodian, on
a daily basis, of the total amount of Good Redemption Orders
received and/or estimated, as the case may be. Redemption
orders which are not in good order, will be promptly rejected
by the Transfer Agent, absent Proper Instructions to the
contrary, and the Shareholder will be promptly notified of such
action.
(2) Upon receipt of redemption proceeds from the Custodian with
respect to any Good Redemption Order, in an amount equal to the
product of the number of Shares to be redeemed times the Next
Calculated NAV, the Transfer Agent shall pay or cause to be
paid such redemption proceeds in the manner instructed by the
redeeming Shareholders.
(3) The Transfer Agent shall effect transfers and/or exchanges
of Shares from time to time as instructed by the registered
owners thereof, to the extent that such transfer and/or
exchange instructions are in good order according to the
Processing Guidelines ("Good Transfer/Exchange Orders"). All
exchanges shall be processed as a redemption from the Fund in
which the Shareholder is currently invested and a purchase of
Shares in the Fund into which the Shareholder wishes to
exchange. All instructions for transfer and/or exchange of
Shares which are not Good Transfer/Exchange Orders shall be
promptly rejected by the Transfer Agent, absent Proper
Instructions to the contrary, and the Shareholder will be
promptly notified of such action.
(4)The Transfer Agent shall deduct from all redemption
proceeds, and remit to the appropriate party according to
Proper Instructions, any applicable redemption fees, contingent
deferred sales charges, and other appropriate fees according to
(i) the Prospectus of the Fund, (ii) the relevant information
contained in any Good Redemption Orders, and (iii) Proper
Instructions, as applicable.
C. Distributions
(1) Upon receipt by the Transfer Agent of Proper Instructions
as to any distributions declared in respect of Shares, the
Transfer Agent shall act as Dividend Disbursing Agent for the
Funds and shall either credit the amount of any such
distribution to Shareholders of record on the record date for
such distribution, or pay such distribution in cash to such
Shareholders on the payable date, pursuant to instructions from
such Shareholders and in accordance with the provisions of the
Fund's governing document and its Prospectus. Such credits or
payments, as the case may be, shall be made by the Transfer
Agent on the date established for same in the Proper
Instructions (the "Distribution Payment Date"). As the
Dividend Disbursing Agent, the Transfer Agent shall, on or
before the Distribution Payment Date, notify the Custodian of
the estimated amount required to pay any portion of said
distribution which is payable in cash and instruct the
Custodian to make sufficient funds available to pay such
amounts. The Transfer Agent shall reconcile instructions given
to the Custodian against amounts received from the Custodian,
on a daily basis. If a Shareholder has not elected to receive
any such distribution in cash, the Transfer Agent shall credit
the Shareholder's account with a number of Shares equal to the
product of the aggregate dollar amount of such distribution
divided by the Next Calculated NAV for Shares, determined as of
the date set forth in the Proper Instructions; and
(2) The Transfer Agent shall maintain records of account for
each Fund and Portfolio, and the classes thereof, and advise
each Fund, each Portfolio, and the classes thereof, and their
respective Shareholders as to the foregoing.
D. Recordkeeping
(1) The Transfer Agent shall record the issuance of Shares of
each Fund, and/or Class, and maintain a record of the total
number of Shares of the Fund and/or Class which are authorized,
based upon data provided to it by the Fund, and issued and
outstanding. The Transfer Agent shall also provide the Fund on
a regular basis or upon reasonable request with the total
number of Shares which are authorized and issued and
outstanding, but shall have no obligation when recording the
issuance of Shares, except as otherwise set forth herein, to
monitor the issuance of such Shares or to take cognizance of
any laws relating to the issue or sale of such Shares, which
functions shall be the sole responsibility of the Funds.
(2) The Transfer Agent shall establish and maintain records
relating to the services to be performed hereunder in the form
and manner as agreed to by the Funds including but not limited
to, for each Shareholder's account, the following:
(a) Relevant, required account ownership, including name,
address, date of birth and social security/tax
identification number (and whether such number has been
certified);
(b) Number of Shares owned of record;
(c) Historical information regarding the account,
including dividends paid and time, date and price for all
transactions;
(d) Any stop or restraining order placed against the
account;
(e) Information with respect to withholding in the case
of a foreign account or an account for which backup or
other withholding is required by the Internal Revenue Code;
(f) Any dividend reinvestment instructions, systematic
investment or withdrawal plan applications and
instructions, cash dividend payment address and any and
all correspondence relating to the current registration or
other effective instructions with respect to such account;
(g) Any information required in order for the Transfer
Agent to perform the calculations contemplated or required
by this Agreement; and
(h) Any such other records as are required to be
maintained under Applicable Law with respect to the
services to be provided by the Transfer Agent hereunder.
(3) The Transfer Agent shall preserve any such records that are
required to be maintained for the periods for which they are
required by Applicable Law to be maintained. The Transfer
Agent acknowledges that any and all such records are the
property of the Fund, and the Transfer Agent shall forthwith
upon Proper Instructions, turn over to the Fund or to the
person designated in the Proper Instructions, and cease to
retain in the Transfer Agent's files, records and documents
created and maintained by the Transfer Agent pursuant to this
Agreement, which are no longer needed by the Transfer Agent in
performance of its services or for its protection. If not so
required to be turned over, such records and documents will be
retained by the Transfer Agent for six years from the year of
creation, during the first two of which such documents will be
in readily accessible form and in a readily accessible
location. At the end of the six-year period, such records and
documents will either be turned over to the Fund or, absent
contrary Proper Instructions, destroyed in accordance with the
then current record-retention policy of the Transfer Agent.
E. Confirmations and Reports
(1)The Transfer Agent shall furnish the following information
to the Fund, or other party at the direction of the Fund
pursuant to Proper Instructions, upon request:
(a) A copy of the transaction register;
(b) Dividend and reinvestment blotters;
(c)Shareholder lists and statistical information;
(d) Information as to payments to third parties relating to distribution
agreements, allocations of sales loads, redemption
fees, or other transaction- or sales-related
payments;
(e) The total number of Shares issued and outstanding in each state for
"blue sky" purposes as determined according to Proper
Instructions delivered from time to time by the Fund
to the Transfer Agent; and
(f) Such other information as may be agreed upon from
time to time.
(2) The Transfer Agent shall prepare and timely file with the
United States Internal Revenue Service, and appropriate state
agencies, all required information reports as to dividends and
distributions paid to Shareholders. The Transfer Agent shall
prepare and timely mail to Shareholders, to the extent
required, all information and/or notices with respect to
dividends and distributions paid to such Shareholder, the sale
price of any Shares sold and such other information as shall
be necessary for the Shareholders to determine the amount of
any taxable gain or loss in respect of the sale of Shares.
(3) The Transfer Agent shall prepare and mail confirmation
statements and statements of account to Shareholders for all
purchases and redemptions of Shares and other confirmable
transactions in Shareholder accounts.
(4) The Transfer Agent shall provide to all Shareholders,
such prospectuses, semi-annual reports, annual reports, proxy
statements and, only as requested, statements of additional
information ("Disclosure Documents") as are provided to
Transfer Agent by the Funds, at the times and in the form
directed by the Funds from time to time. The Funds shall
provide the Transfer Agent with such quantities of the
Disclosure Documents as the Transfer Agent shall reasonably
request for purposes of permitting the Transfer Agent to
fulfill this obligation.
F. Other Rights and Duties
(1) To the extent required under the Functional Matrix, the
Transfer Agent shall answer correspondence from Shareholders
relating to their Share accounts and such other correspondence
as may from time to time be addressed to the Transfer Agent or
forwarded to the Transfer Agent for response by the
administrator or other service provider for the Fund.
(2) The Transfer Agent shall engage a subcontractor to
(a) prepare Shareholder meeting lists, mail proxy cards and
other material supplied to it by the Fund in connection with
shareholder meetings of each Fund; and (b) receive, examine and
tabulate returned proxies, and certify the vote of the
Shareholders.
(3) The Transfer Agent shall establish and maintain facilities
and procedures for (a) the safekeeping of check forms and
facsimile signature imprinting devices, if any; and (b) the
preparation or use, and for keeping account of, such
certificates, forms and devices.
(4)The Transfer Agent shall: (a) operationally support
transactions with the registered owners of omnibus accounts
with whom the Funds have an agreement for the provision of
services necessary for the recordkeeping or sub-accounting of
share positions held in underlying sub-accounts (each, a
"Recordkeeping Agreement"), by agreeing to perform, pursuant to
Proper Instructions, those obligations of the Funds under such
Recordkeeping Agreements as are set forth in the written
agreement between the Fund and the Recordkeeping Agent and (b)
enter into account control agreements, for, on behalf of, and
in the name of, the Funds for the purpose of perfecting the
security interest of a lender in Shares pledged as collateral
by a Shareholder under and pursuant to an Uncertificated
Securities Account Control Agreement in the form attached
hereto as Exhibit B, and to perform the obligations of the
Issuer (as defined therein) thereunder in accordance with the
terms thereof. It is expressly acknowledged and agreed,
however, that to the extent that any Recordkeeping Agreement
contains terms or conditions that are not contained in, or are
materially different from, the terms and conditions set forth
in the form of Recordkeeeping Agreement reviewed by the
Transfer Agent as of the date hereof, the Funds shall afford
Transfer Agent a reasonable opportunity, not to exceed one
week, within which to review such modified Recordkeeping
Agreement and indicate any required changes.
(5)The Transfer Agent shall identify and process abandoned
accounts and uncashed checks for state escheat requirements on
an annual basis and report such actions to the Fund.
2.2 Additional Services. In addition to, and neither in lieu nor in
contravention of, the services set forth in Section 2.1, the Transfer
Agent shall perform the following services:
(a) Other Customary Services. Perform the customary services of a
transfer agent, dividend disbursing agent and, as relevant, agent in
connection with accumulation, open-account or similar plan (including
without limitation any periodic investment plan or periodic withdrawal
program);
(b) Control Book (also known as "Super Sheet"). Maintain a daily
record and produce a daily report for the Fund of all transactions and
receipts and disbursements of money and securities and deliver a copy
of such report for the Fund for each business day to the Fund no later
than 9:00 AM Eastern Time, or such earlier time as the Fund may
reasonably require, on the next business day;
(c) National Securities Clearing Corporation (the "NSCC"). In
accordance with the rules and procedures of the NSCC in effect from
time to time during the Term, (i) accept and effectuate (A) the
registration and maintenance of accounts through the NSCC's services
known as networking ("Networking") and (B) the purchase, redemption,
transfer and exchange of shares in such accounts through the NSCC's
services known as Fund/SERV ("Fund/SERV"), (ii) accept and process
instructions transmitted to, and received by, the Transfer Agent by
transmission from the NSCC on behalf of broker dealers and banks which
have been established by, or in accordance with Proper Instructions,
and instructions of persons designated on the appropriate dealer file
maintained by the Transfer Agent as authorized by the Fund to give such
instructions, (iii) issue instructions to Fund's banks for the
settlement of transactions between the Fund and NSCC (acting on behalf
of its broker-dealer and bank participants); (iv) provide account and
transaction information from the affected Fund's records on DST
Systems, Inc. computer system TA2000 ("TA2000 System") in accordance
with NSCC's Networking and Fund/SERV rules for those broker-dealers;
and (v) maintain Shareholder accounts on TA2000 System through
Networking;
(d) New Procedures. New procedures as to who shall provide certain of
these services in Section 2 may be established through an amendment to
this Agreement from time to time, such that the Transfer Agent may at
times perform some of these services and the Fund or its agent may
perform other of these services;
(e) Telephone Support Services. To the extent contemplated in the
Functional Matrix, provide telephone support services and, to the
extent agreed upon by the Transfer Agent and the Fund, provide
additional telephone support services under this Agreement; and
(f) Anti-Money Laundering ("AML") Delegation. Perform certain of the
Fund's obligations under the USA PATRIOT Act, including the obligation
to perform all duties under the Fund's duly-adopted Anti-Money
Laundering Program (the "AML Program"), on the terms stated in Schedule
2.2(f) attached hereto, as the same may be amended from time to time by
mutual written agreement of the parties.
(g) Checkwriting Services Support. Perform the services set forth on
Schedule 2.2(g) hereto, as the same may be amended by mutual agreement
of the parties hereto from time to time, in connection with the
checkwriting privileges, if any, extended by the Fund.
(h) Debit Card Services Support. Perform the services set forth on
Schedule 2.2(h) hereto, as the same may be amended by mutual agreement
of the parties hereto from time to time, in connection with the debit
card privileges, if any, extended by the Fund:
2.3 Retirement Accounts. With respect to certain retirement plans or
accounts (such as individual retirement accounts ("IRAs"), SIMPLE IRAs,
SEP IRAs, Xxxx IRAs, Education IRAs, and 403(b) Plans (such accounts,
"Retirement Accounts"), the Transfer Agent, at the request and expense
of the Fund, shall arrange for the provision of appropriate prototype
plans as well as provide or arrange for the provision of various
services to such plans and/or accounts, which services may include
custodial services to be provided by State Street Bank and Trust
Company, in its capacity as a bank, account set-up maintenance, and
disbursements as well as such other services as the parties hereto
shall mutually agree upon.
2.4 Specific Duties and Allocation Thereof. The Transfer Agent and
Federated Services Company, the prior transfer agent for the Fund (the
"Prior Transfer Agent") have reviewed the functions performed for the
Fund by the Prior Transfer Agent and have set forth on Schedule 2.4 (as
amended from time to time, the "Functional Matrix") all of such
functions which after the date hereof the Transfer Agent shall perform
for the Fund for the fees set forth on Schedule 3.1. Whether or not
specifically enumerated herein, the Transfer Agent shall, for the fees
set forth in the Fee Schedule, perform all of the functions specified
in the Functional Matrix. In the event of any conflict between the
description of said function contained in this Section 2 and the
Functional Matrix, the Functional Matrix shall control.
2.5 Periodic Review of Compliance Policies and Procedures. During the
Term, Transfer Agent shall periodically assess its compliance policies
and procedures (the "Policies"). Transfer Agent shall provide, (i) no
less frequently than annually, a copy of its Policies to the chief
compliance officer of the Fund (the "Chief Compliance Officer"), and/or
any individual designated by the Fund or such Chief Compliance Officer,
including but not limited to members of the internal compliance and
audit departments of Federated Investors, Inc., (ii) at such reasonable
times as he or she shall request, access by such Chief Compliance
Officer to such individuals as may be necessary for the Chief
Compliance Officer to conduct an annual review of the operation of such
Policies for purposes of making his or her annual report to the Board
of the Fund (the "Annual Report"), (iii) promptly upon enactment,
notification of, and a copy of, any material change in such Policies,
and (iv) promptly upon request, such other information as may be
reasonably requested by such Chief Compliance Officer for purposes of
making such Annual Report.
2.6 Cooperation with Respect to Examinations and Audits. Transfer Agent
shall provide assistance to and cooperate with the Fund with respect to
any federal or state government-directed examinations and with the
Fund's internal or external auditors in connection with any
Fund-directed audits. For purposes of such examinations and audits, at
the request of the Fund, the Transfer Agent will use all reasonable
efforts to make available, during normal business hours of the Transfer
Agent's facilities, all records and Policies solely as they directly
pertain to the Transfer Agent's activities under or pursuant to this
Agreement. Such audits and examinations shall be conducted at the
Fund's expense and in a manner that will not interfere with the
Transfer Agent's normal and customary conduct of its business
activities. To the extent practicable, the Fund shall make every
effort to (i) coordinate Fund-directed audits so as to minimize the
inconvenience to the Transfer Agent and (ii) conduct Fund-directed
audits of the Transfer Agent simultaneously. With respect to
Fund-directed audits, the Transfer Agent shall provide such assistance
in accordance with reasonable procedures and at reasonable frequencies,
and the Fund shall provide reasonable advance notice of not less than
forty-eight (48) hours to the Transfer Agent of such audits, and to the
extent possible, of such examinations. The Transfer Agent may require
any persons seeking access to its facilities to provide reasonable
evidence of their authority. With respect to Fund-directed audits, the
Transfer Agent may require such persons to execute a confidentiality
agreement before granting access. On an annual basis, the Transfer
Agent will provide the Fund with copies of its SAS 70 report.
3. Fees and Expenses
3.1 Fee Schedule. For the performance by the Transfer Agent of its
obligations pursuant to this Agreement, the Fund agrees to pay the
Transfer Agent an annual maintenance fee for each Shareholder account
as set forth in the attached fee schedule ("Schedule 3.1")(the "Fee
Schedule"). Such fees and out-of-pocket expenses and advances
identified under Section 3.2 below may be changed from time to time
subject to mutual written agreement between the Fund and the Transfer
Agent.
3.2 Out-of-Pocket Expenses. In addition to the fee paid under Section 3.1
above, the Fund agrees to reimburse the Transfer Agent for the
out-of-pocket expenses listed on Schedule 3.2 hereof ("Schedule 3.2").
Such out-of-pocket expenses, and the accrual, calculation and
conformity of same to Schedule 3.2 shall be subject to audit from time
to time by the treasurer of the Fund. In addition, any other expenses
incurred by the Transfer Agent at the request or with the prior consent
of the Fund will be reimbursed by the Fund.
3.3 Postage. Postage for mailing of dividends, proxies, Fund reports and
other mailings to all shareholder accounts shall be forwarded to the
Transfer Agent by the Fund on the date of the scheduled mailing of such
materials
3.4 Invoices. The Fund agrees to pay all fees and reimbursable expenses
within thirty (30) days following the receipt of the respective billing
notice, except for that portion of any fees or expenses which are
subject to good faith dispute. In the event of such a dispute, the
Fund may only withhold that portion of the fee or expense subject to
the good faith dispute. The Fund shall notify the Transfer Agent in
writing within twenty-one (21) calendar days following the receipt of
each billing notice if the Fund is disputing any amounts in good
faith. The Fund shall pay such disputed amounts within fifteen (15)
days of the day on which the parties agree on the amount to be paid.
If no agreement is reached, then such disputed amounts shall be settled
as may be required by law or legal process.
3.5 Cost of Living Adjustment. During the first three (3) years of the
Initial Term, the fees hereunder shall not be changed absent a written
agreement of the parties. Following the third anniversary of the date
hereof, and during any Renewal Term hereof unless the parties shall
otherwise agree pursuant to Section 12.1 hereof, provided that the
service mix and volumes remain consistent with the service mix and
volumes during the Initial Term, the total fee for all services shall
equal the fee that would be charged for the same services based on a
fee rate (as reflected in a Fee Schedule) increased by the percentage
increase for the twelve-month period of such previous calendar year of
the CPI-W (defined below) or, in the event that publication of such
index is terminated, any successor or substitute index. As used
herein, "CPI-W" shall mean the Consumer Price Index for Urban Wage
Earners and Clerical Workers (Area: Boston-Brockton-Nashua,
MA-NH-ME-CT; Base Period: 1982-84=100), as published by the United
States Department of Labor, Bureau of Labor Statistics.
3.6 Late Payments. If any undisputed amount in an invoice of the Transfer
Agent (for fees or reimbursable expenses) is not paid when due, the
Fund shall pay the Transfer Agent interest thereon (from the due date
to the date of payment) at a per annum rate equal to one percent (1.0%)
plus the Prime Rate (that is, the base rate on corporate loans posted
by large domestic banks) published by The Wall Street Journal (or, in
the event such rate is not so published, a reasonably equivalent
published rate selected by the Transfer Agent) on the first day of
publication during the month when such amount was due. Notwithstanding
any other provision hereof, such interest rate shall be no greater than
permitted under applicable provisions of Massachusetts law.
4. Representations and Warranties of the Transfer Agent
The Transfer Agent represents and warrants to the Fund that:
4.1 It is a corporation duly organized and existing and in good standing
under the laws of The Commonwealth of Massachusetts.
4.2 It is duly qualified to carry on its business in The Commonwealth of
Massachusetts.
4.3 It is empowered under applicable laws and by its Articles of
Organization and By-Laws to enter into and perform this Agreement.
4.4 All requisite corporate proceedings have been taken to authorize it to
enter into and perform this Agreement.
4.5 It is in compliance with federal securities law requirements in all
material respects with respect to its business, including but not
limited to Applicable Law, and is in good standing as a registered
transfer agent.
4.6 It has and will continue to have access to the necessary facilities,
equipment and personnel to perform its duties and obligations under
this Agreement.
5. Representations and Warranties of the Fund
Each Fund represents and warrants to the Transfer Agent that:
5.1 It is an entity duly organized and existing and in good standing under
the laws of the applicable State in which it was organized.
5.2 It is empowered under applicable laws and by organizational documents
to enter into and perform this Agreement.
5.3 All corporate proceedings required by its organizational documents have
been taken to authorize it to enter into and perform this Agreement.
5.4 It is an open-end management investment company registered under the
Investment Company Act of 1940, as amended.
5.5 It is in compliance with federal securities law requirements in all
material respects with respect to its business.
5.6 A registration statement under the Securities Act of 1933, as amended
is currently effective and will remain effective, and appropriate state
securities law filings have been made and will continue to be made,
with respect to all Shares of the Fund being offered for sale.
6. Wire Transfer Operating Guidelines/Article 4A of the Uniform Commercial
Code
6.1 Obligation of Sender. The Transfer Agent is authorized to promptly
debit the appropriate Fund account(s) upon the receipt of a Good
Redemption Order in compliance with the selected security procedure
(the "Security Procedure") chosen by the Fund for funds transfer and in
the amount of money that the Transfer Agent has been instructed to
transfer. The Transfer Agent shall execute such payment orders in
compliance with the Security Procedure and with the Proper Instructions
on the execution date provided that such payment order is received by
the customary deadline for processing such a request, unless the
payment order specifies a later time. All payment orders and
communications received after the customary deadline will be deemed to
have been received the next business day.
6.2 Security Procedure. The Fund acknowledges that the Security Procedure
it has designated on the Fund Selection Form was selected by the Fund
from security procedures offered by the Transfer Agent. The Fund shall
restrict access to confidential information relating to the Security
Procedure to authorized persons as communicated to the Transfer Agent
in writing. The Fund must notify the Transfer Agent immediately if it
has reason to believe unauthorized persons may have obtained access to
such information or of any change in the Fund's authorized personnel.
The Transfer Agent shall verify the authenticity of all Proper
Instructions according to the Security Procedure.
6.3 Account Numbers. The Transfer Agent shall process all payment orders
on the basis of the account number contained in the payment order. In
the event of a discrepancy between any name indicated on the payment
order and the account number, the account number shall take precedence
and govern.
6.4 Rejection. The Transfer Agent reserves the right to (a) decline to
process or delay the processing of a payment order which is in excess
of the collected balance in the account to be charged at the time of
the Transfer Agent's receipt of such payment order; or (b)(i) require
Proper Instructions with respect to any payment order or, (ii) failing
the provision of such Proper Instructions, decline to process or delay
the processing of a payment order, if the Transfer Agent, in good
faith, is unable to satisfy itself that the transaction has been
properly authorized; (c) decline to process or delay the processing of
a payment order if initiating such payment order would, due to
restrictions imposed by the Federal Reserve Board, cause the Transfer
Agent, in the Transfer Agent's sole judgment, to exceed any volume,
aggregate dollar, network, time, credit or similar limits which are
applicable to the Transfer Agent; or (d) decline to process or delay
the processing of a payment order if the Transfer Agent, in good faith,
is unable to satisfy itself that the transaction has been properly
authorized.
6.5 Cancellation or Amendment. The Transfer Agent shall use reasonable
efforts to act on all Proper Instructions to cancel or amend payment
orders received in compliance with the Security Procedure provided that
such requests are received in a timely manner affording the Transfer
Agent reasonable opportunity to act. However, the Transfer Agent
assumes no liability if the request for amendment or cancellation
cannot be satisfied.
6.6 Errors. The Transfer Agent shall assume no responsibility for failure
to detect any erroneous payment order provided that the Transfer Agent
complies with the payment order instructions as received and the
Transfer Agent complies with the Security Procedure. The Security
Procedure is established for the purpose of authenticating payment
orders only and not for the detection of errors in payment orders.
6.7 Interest. The Transfer Agent shall assume no responsibility for lost
interest with respect to the refundable amount of any unauthorized
payment order, unless the Transfer Agent is notified of the
unauthorized payment order within thirty (30) days of notification by
the Transfer Agent of the acceptance of such payment order.
6.8 ACH Credit Entries/ Provisional Payments. When the Fund initiates or
receives Automated Clearing House credit and debit entries pursuant to
the rules of the National Automated Clearing House Association and the
New England Clearing House Association, the Bank will act as an
Originating Depository Financial Institution and/or Receiving
Depository Financial Institution, as the case may be, with respect to
such entries. Credits given by the Transfer Agent with respect to an
ACH credit entry are provisional until the Transfer Agent receives
final settlement for such entry from the Federal Reserve Bank. If the
Transfer Agent does not receive such final settlement, the Fund agrees
that the Transfer Agent shall receive a refund of the amount credited
to the Fund in connection with such entry, and the party making payment
to the Fund via such entry shall not be deemed to have paid the amount
of the entry.
6.9 Confirmation. Confirmation of Transfer Agent's execution of payment
orders shall ordinarily be provided to the Fund within twenty four (24)
hours and may be delivered through the Transfer Agent's proprietary
information systems, or by facsimile or call-back. Fund must report any
objections to the execution of an order within thirty (30) days.
7. Data Access and Proprietary Information
7.1 The Fund acknowledges that the databases, computer programs, screen
formats, report formats, interactive design techniques, and
documentation manuals furnished to the Fund by the Transfer Agent as
part of the Fund's ability to access certain Fund Confidential
Information (defined in Section 10 below) maintained by the Transfer
Agent on databases under the control and ownership of the Transfer
Agent or other third party ("Data Access Services") constitute
copyrighted, trade secret, or other proprietary information of
substantial value to the Transfer Agent or other third party
(collectively, "Transfer Agent Proprietary Information"). In no event
shall Transfer Agent Proprietary Information be deemed Fund
Confidential Information. The Fund agrees to treat all Transfer Agent
Proprietary Information as proprietary to the Transfer Agent and
further agrees that it shall not divulge any Transfer Agent Proprietary
Information to any person or organization except as may be provided
hereunder. Without limiting the foregoing, the Fund agrees for itself
and its employees and agents to:
(a) Use such programs and databases (i) solely on the Fund's computers
or on computers of Federated Services Company or its Affiliates, or
(ii) solely from equipment at the location agreed to between the Fund
and the Transfer Agent and (iii) solely in accordance with the Transfer
Agent's applicable user documentation;
(b) Refrain from copying or duplicating in any way (other than in the
normal course of performing processing on the Fund's computer(s)), the
Transfer Agent Proprietary Information;
(c) Refrain from obtaining unauthorized access to any portion of the
Transfer Agent Proprietary Information, and if such access is
inadvertently obtained, to inform Transfer Agent in a timely manner of
such fact and dispose of such information in accordance with the
Transfer Agent's instructions;
(d) Refrain from causing or allowing information transmitted from the
Transfer Agent's computer to the Fund's terminal to be retransmitted to
any other computer terminal or other device except as expressly
permitted by the Transfer Agent (such permission not to be unreasonably
withheld);
(e) Allow the Fund to have access only to those authorized
transactions as agreed to between the Fund and the Transfer Agent; and
(f) Honor all reasonable written requests made by the Transfer Agent
to protect at the Transfer Agent's expense the rights of the Transfer
Agent in the Transfer Agent Proprietary Information at common law,
under federal copyright law and under other federal or state law.
7.2 Transfer Agent Proprietary Information shall not include all or any
portion of any of the foregoing items that: (i) is or subsequently
becomes publicly available without breach by the Fund, its employees,
agents or subcontractors of any obligation owed to the Transfer Agent
under this Agreement; (ii) is released for general disclosure by a
written release by the Transfer Agent; (iii) is Fund Confidential
Information, (iv) becomes known to the Fund from a source other than
the Transfer Agent other than by the breach of an obligation of
confidentiality owed to the Transfer Agent by such third party; or (v)
is independently developed by the Fund without reference to information
provided by the Transfer Agent. With respect to exceptions (iv) and
(v), the burden shall be on the Fund to demonstrate, through
appropriate documentation, the applicability of such exception.
7.3 The Fund acknowledges that its obligation to protect the Transfer Agent
Proprietary Information is essential to the business interest of the
Transfer Agent and that the disclosure of such information in breach of
this Agreement may cause the Transfer Agent immediate, substantial and
irreparable harm, the value of which would be difficult to determine.
Accordingly, the parties agree that, in addition to any other remedies
that may be available in law, equity, or otherwise for the disclosure
or use of the Transfer Agent Proprietary Information in breach of this
Agreement, the Transfer Agent shall be entitled to seek and obtain a
temporary restraining order, injunctive relief, or other equitable
relief against the continuance of such breach.
7.4 The Fund shall take reasonable efforts to advise its employees of their
obligations pursuant to this Section 7. The obligations of this
Section shall survive any earlier termination of this Agreement.
7.5 If the Fund notifies the Transfer Agent that any of the Data Access
Services do not operate in material compliance with the most recently
issued user documentation for such services, the Transfer Agent shall
use its best efforts in a timely manner to correct such failure.
Organizations from which the Transfer Agent may obtain certain data
included in the Data Access Services are solely responsible for the
contents of such data and the Fund agrees to make no claim against the
Transfer Agent arising out of the contents of such third-party data,
including, but not limited to, the accuracy thereof; provided, however,
that the Fund shall be entitled to insist that the Transfer Agent, and
the Transfer Agent for the benefit of the Funds shall, enforce any and
all rights under applicable contracts for the Data Access Services.
SUBJECT TO THE FOREGOING OBLIGATIONS OF THE TRANSFER AGENT, DATA ACCESS
SERVICES AND ALL COMPUTER PROGRAMS AND SOFTWARE SPECIFICATIONS USED IN
CONNECTION THEREWITH ARE PROVIDED ON AN AS IS, AS AVAILABLE BASIS.
EXCEPT AS OTHERWISE PROVIDED HEREIN TO THE CONTRARY, THE TRANSFER AGENT
EXPRESSLY DISCLAIMS ALL WARRANTIES INCLUDING, BUT NOT LIMITED TO, THE
IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR
PURPOSE.
7.6 If the transactions available to the Fund include the ability to
originate Proper Instructions through electronic instructions to the
Transfer Agent in order to: (i) effect the transfer or movement of cash
or Shares; or (ii) transmit Shareholder information or other
information, then in such event the Transfer Agent shall be entitled to
rely on the validity and authenticity of such Proper Instructions
without undertaking any further inquiry as long as such Proper
Instruction is undertaken in conformity with Security Procedures.
7.7 Section 7.1 shall not restrict any disclosure required to be made by
Applicable Law, except that (i) in case of any requests or demands for
the inspection of Transfer Agent Proprietary Information that arise
from persons other than authorized officers of the Transfer Agent, the
Fund will promptly notify the Transfer Agent and secure instructions
from an authorized officer of the Transfer Agent as to such inspection
and (ii) the Fund shall promptly notify an authorized officer of the
Transfer Agent in writing of any and all legal actions received by or
served on the Fund with respect to the Transfer Agent, and shall use
its best efforts to promptly notify the Transfer Agent of all contacts
and/or correspondence received by the Fund from any regulatory
department or agency or other governmental authority purporting to
regulate the Transfer Agent and not the Fund, regarding the Fund's
duties and activities performed in connection with this Agreement, and
will cooperate with the Transfer Agent in responding to such legal
actions, contacts and/or correspondence. Notwithstanding the
restrictions on Transfer Agent Proprietary Information described
herein, when required by law, court order or regulatory authority, the
Fund will disclose such Transfer Agent Proprietary Information as it
deems reasonable and appropriate when required to do so by law, court
order or regulatory authority. The Fund and the Transfer Agent will
agree on reasonable procedures regarding such required disclosure and
the Fund will make every reasonable effort to notify the Transfer Agent
of requests for such information by the Securities and Exchange
Commission or any other federal or State securities regulatory agencies
prior to the release of such records.
8. Indemnification
8.1 The Transfer Agent shall not be responsible for, and the Fund shall
indemnify, defend and hold the Transfer Agent harmless from and
against, any and all losses, damages, costs, charges, counsel fees,
payments, expenses and liability arising out of or attributable to:
(a) All actions of the Transfer Agent or its agents or subcontractors
required to be taken pursuant to this Agreement (including the defense
of any lawsuit in which the Transfer Agent or affiliate is a named
party), provided that such actions are taken in good faith and without
negligence or willful misconduct;
(b) The Fund's lack of good faith, negligence or willful misconduct;
(c) The reliance upon, and any subsequent use of or action taken or
omitted, by the Transfer Agent, or its agents or subcontractors on: (i)
any information, records, documents, data, stock certificates or
services, which are received by the Transfer Agent or its agents or
subcontractors by machine readable input, facsimile, CRT data entry,
electronic instructions or other similar means authorized by the Fund,
and which have been prepared, maintained or performed by the Fund or
any other person or firm on behalf of the Fund including but not
limited to any broker-dealer, TPA or previous transfer agent; (ii) any
instructions or requests of the Fund or any of its officers; (iii) any
written instructions or opinions of the Fund's legal counsel with
respect to any matter arising in connection with the services to be
performed by the Transfer Agent under this Agreement which are provided
to the Transfer Agent by the Fund after consultation by the Fund with
such legal counsel and which expressly allow the Transfer Agent to rely
up such instructions or opinions; or (iv) any paper or document,
reasonably believed to be genuine, authentic, or signed by the proper
person or persons;
(d) The offer or sale of Shares in violation of federal or state
securities laws or regulations requiring that such Shares be registered
or in violation of any stop order or other determination or ruling by
any federal or any state agency with respect to the offer or sale of
such Shares;
(e) The negotiation and processing of any checks including without
limitation for deposit into the Fund's demand deposit account
maintained by the Transfer Agent; or
(f) Upon the Fund's request entering into any agreements required by
the NSCC for the transmission of Fund or Shareholder data through the
NSCC clearing systems.
8.2 The Transfer Agent shall, subject to the provisions of Section 9
below, indemnify and hold the Fund harmless from and against any and
all losses, damages, costs, charges, counsel fees, payments, expenses
and liability arising out of or attributable to any claim that any
aspect of the services or systems provided under, and used within the
scope of, this Agreement infringes any U.S. patent, copyright, trade
secret or other intellectual property rights. With respect to any
such claims, the Transfer Agent may, in its sole discretion, either
(i) procure for the Fund a right to continue to use such service or
system, (ii) replace or modify the service or system so as to be
non-infringing without materially affecting the functions of the
service or system, or (iii) if, in the Transfer Agent's reasonable
discretion, the actions described in (i) and (ii) are not capable of
being accomplished on commercially reasonable terms, terminate this
Agreement with respect to the affected service or system.
Notwithstanding the foregoing, the Transfer Agent shall have no
liability or obligation of indemnity for any claim which is based
upon a modification of a service or system by anyone other than the
Transfer Agent, use of such service or system other than in
accordance with the terms of this Agreement, or use of such service
or system in combination with other software or hardware not provided
by the Transfer Agent if infringement could have been avoided by not
using the service or system in combination with such other software
or hardware.
8.3 In order that the indemnification provisions contained in this Section
8 shall apply, upon the assertion of a claim for which the Fund may be
required to indemnify the Transfer Agent, the Transfer Agent shall
promptly notify the Fund of such assertion, and shall keep the Fund
advised with respect to all developments concerning such claim. The
Fund shall have the option to participate with the Transfer Agent in
the defense of such claim or to defend against said claim in its own
name or in the name of the Transfer Agent. The Transfer Agent shall in
no case confess any claim or make any compromise in any case in which
the Fund may be required to indemnify the Transfer Agent unless the
Fund provides its consent or the Transfer Agent waives its right to the
indemnity.
9. Standard of Care/Limitation of Liability
9.1 The Transfer Agent shall at all times act in good faith and agrees to
use its best efforts within reasonable limits to ensure the accuracy of
all services performed under this Agreement, but assumes no
responsibility and shall not be liable for loss or damage due to
errors, including encoding and payment processing errors, unless said
errors are caused by its negligence, bad faith, or willful misconduct
or that of its employees or agents. The parties agree that any
encoding or payment processing errors shall be governed by this
standard of care and Section 4-209 of the Uniform Commercial Code is
superseded by Section 9 of this Agreement. The Transfer Agent shall
provide the Fund, at such times as the Fund may reasonably require,
copies of publicly available reports rendered by independent public
accountants on the internal controls and procedures of the Transfer
Agent relating to the Services provided by the Transfer Agent under
this Agreement.
9.2 The liability of the Transfer Agent hereunder shall be subject to the
limits, if any, set forth on Schedule 3.1 attached hereto, as the same
may be amended from time to time by mutual written agreement of the
parties.
9.3 Notwithstanding anything to the contrary contained herein, the omission
of an express indemnity in favor of the Fund, as to all matters other
than intellectual property infringement, shall in no way be construed
so as to limit the legal rights, remedies and/or recourse of the Fund
against the Transfer Agent, and the Fund does hereby reserve any and
all such rights, remedies and recourse, with respect to any breach by
the Transfer Agent of any provision of this Agreement.
10. Fund Confidential Information
10.1All Fund Confidential Information (defined below) shall be deemed to be
proprietary and the Transfer Agent shall hold all such information
confidential and in strict confidence and shall not disclose it to any
third party, except to the extent necessary to perform the Services
hereunder and then only pursuant to an independent obligation of such
third party to maintain the confidentiality of such information on
substantially the same terms as set forth herein, unless Proper
Instructions to make such disclosure have been given by the Fund.
"Fund Confidential Information" shall mean any information obtained by
or on behalf of the Transfer Agent from, or disclosed to the Transfer
Agent or its representatives by, the Fund or any shareholder of the
Fund, or created by the Fund that relates to the Fund's past, present
or future activities, whether any of such information is in oral or
printed form or on any computer disks, computer tapes, or other
electronic or magnetic formats, including, without limitation, (i)
non-public personal information, financial statements and financial
data concerning shareowners, (ii) investments and transactions of and
by shareowners, (iii) shareowner related information, (iv) any
communications with shareowners (including, without limitation, tape
recorded conversations) in connection with the provision of the
services or which results from the provision of the services and (v)
any and all Fund-related policies and procedures, including but not
limited to monitoring techniques, related to the discouragement of
frequent trading and other undesirable practices. Under no
circumstances shall the Transfer Agent's Proprietary Information be
deemed to be Fund Confidential Information.
10.2Fund Confidential Information shall not include all or any portion of
any of the foregoing items that: (i) is Transfer Agent Proprietary
Information, or (ii) is independently developed by the Transfer Agent
without reference to information provided by the Fund. With respect to
exception (ii), the burden shall be on the Transfer Agent to
demonstrate, through appropriate documentation, the applicability of
such exception.
10.3Section 10.1 shall not restrict any disclosure required to be made by
Applicable Law, except that (i) in case of any requests or demands for
the inspection of Fund Confidential Information that arise from persons
other than authorized officers of the Fund, the Transfer Agent will
(other than standard requests (i.e. divorce and criminal actions)
pursuant to subpoenas of state or federal government authorities)
promptly notify the Fund and secure instructions from an authorized
officer of the Fund as to such inspection and (ii) the Transfer Agent
shall promptly notify an authorized officer of the Fund in writing of
any and all legal actions received by or served on the Transfer Agent
with respect to the Fund, and shall use its best efforts to promptly
notify the Fund of all contacts and/or correspondence received by the
Transfer Agent from any regulatory department or agency or other
governmental authority purporting to regulate the Fund and not the
Transfer Agent, regarding the Transfer Agent's duties and activities
performed in connection with this Agreement, and will cooperate with
the Fund in responding to such legal actions, contacts and/or
correspondence. Notwithstanding the restrictions on Fund Confidential
Information described herein, when required by law, court order or
regulatory authority, the Transfer Agent will disclose such Fund
Confidential Information as it deems reasonable and appropriate when
required to do so by law, court order or regulatory authority. The
Fund and the Transfer Agent will agree on reasonable procedures
regarding such required disclosure and the Transfer Agent will make
every reasonable effort to notify the Fund of requests for such
information by the Securities and Exchange Commission or any other
federal or State regulatory agencies prior to the release of such
records.
10.4The Transfer Agent shall maintain reasonable safeguards for maintaining
in confidence any and all Fund Confidential Information. The Transfer
Agent shall not, at any time, use any such Fund Confidential
Information for any purpose other than as specifically authorized by
this Agreement, or in writing by the Fund.
10.5Upon termination of this Agreement, or as otherwise requested by the
Fund, all Fund Confidential Information held by, or on behalf of, the
Transfer Agent shall, at the expense of the affected Fund, be promptly
returned to the Fund, or an authorized officer of the Transfer Agent
will certify to the Fund in writing that all such information has been
destroyed. Sections 3.2, 3.4 and 3.6 of this Agreement shall survive
any termination of this Agreement for so long as any such expenses
referenced in this Section 10.5 remains outstanding.
10.6 The Transfer Agent acknowledges that its obligation to protect the
Fund's Confidential Information is essential to the business interest
of the Fund and that the disclosure of such information in breach of
this Agreement may cause the Fund immediate, substantial and
irreparable harm, the value of which would be difficult to determine.
Accordingly, the parties agree that, in addition to any other remedies
that may be available in law, equity, or otherwise for the disclosure
or use of the Fund Confidential Information in breach of this
Agreement, the Fund shall be entitled to seek and obtain a temporary
restraining order, injunctive relief, or other equitable relief against
the continuance of such breach.
11. Covenants of the Fund and the Transfer Agent
11.1The Fund shall promptly furnish to the Transfer Agent the following:
(a) A certified copy of the resolution of the Board of the Fund
authorizing the appointment of the Transfer Agent and the execution and
delivery of this Agreement;
(b) A copy of the organizational documents of the Fund and all material
amendments thereto; and
(c) Copies of or access to properties, personnel, books and records,
(including tax records), contracts, and documents necessary for the
Transfer Agent to perform its duties hereunder.
11.2The Transfer Agent hereby agrees to establish and maintain facilities
and procedures reasonably acceptable to the Fund for safekeeping of
stock certificates, check forms and facsimile signature imprinting
devices, if any; and for the preparation or use, and for keeping
account of, such certificates, forms and devices.
11.3 The Transfer Agent shall keep records relating to the services to be
performed hereunder, in the form and manner as it may deem advisable.
To the extent required by Section 31 of the Investment Company Act of
1940, as amended, and the Rules thereunder, the Transfer Agent agrees
that all such records prepared or maintained by the Transfer Agent
relating to the services to be performed by the Transfer Agent
hereunder are the property of the Fund and will be preserved,
maintained and made available in accordance with such Section and
Rules, and will be surrendered promptly to the Fund on and in
accordance with its request.
11.4The Transfer Agent maintains, and covenants that during the Term hereof
it shall continue to maintain, fidelity bond coverage concerning
larceny and embezzlement and an insurance policy with respect to
directors and officers errors and omissions coverage in such amounts,
and with such carriers, as are reasonably acceptable to the Fund in
light of the Transfer Agent's duties and responsibilities hereunder.
Upon the request of the Funds, the Transfer Agent shall provide
evidence that such coverage is in place. The Transfer Agent shall,
promptly upon the receipt of any such notice by any applicable carrier,
notify the Fund should its insurance coverage with respect to
professional liability or errors and omissions coverage be canceled.
Such notification shall include the date of cancellation and the
reasons therefor.
11.5 Notwithstanding anything to the contrary contained in Section 15.3, the
Transfer Agent shall maintain at a location other than its normal
location appropriate redundant facilities for operational back up in
the event of a power failure, disaster or other interruption. The
Transfer Agent shall continuously back up Fund records, and shall store
the back up in a secure manner at a location other than its normal
location, so that, in the event of a power failure, disaster or other
interruption at such normal location, the Fund records, will be
maintained intact and will enable the Transfer Agent to perform under
this Agreement. The Transfer Agent will maintain a comprehensive
business continuity plan and will provide an executive summary of such
plan upon reasonable request of the Fund. The Transfer Agent will test
the adequacy of its business continuity plan at least annually and upon
request, the Fund may participate in such test. Following such test,
upon request by the Fund, the Transfer Agent will provide the Fund with
a letter assessing the most recent business continuity test results.
In the event of a business disruption that materially impacts the
Transfer Agent's provision of services under this Agreement, the
Transfer Agent will notify the Fund of the disruption and the steps
being implemented under the business continuity plan.
11.6 The Transfer Agent shall provide the Fund, at such times as the Fund
may reasonably require, (i) copies of publicly available reports
rendered by independent public accountants on the internal controls and
procedures of the Transfer Agent relating to the Services provided by
the Transfer Agent under this Agreement, (ii) access to the procedures
used to perform the testing described in such reports and (iii) access
to the audit teams preparing any such reports or performing any such
testing.
12. Termination of Agreement
12.1 Term. The initial term of this Agreement shall be five (5) years from
the date first stated above (the "Initial Term") unless terminated
pursuant to the provisions of this Section 12. Unless a party gives
written notice to the other party ninety (90) days before the
expiration of the Initial Term or any Renewal Term, this Agreement will
renew automatically from year to year (each such year-to-year renewal
term a "Renewal Term"; collectively, the Initial Term and any Renewal
Term shall hereafter be referred to as the "Term"). One-hundred twenty
(120) days before the expiration of the Initial Term or a Renewal Term
the parties to this Agreement will agree upon a Fee Schedule for the
upcoming Renewal Term. Otherwise, the fees shall be increased pursuant
to Section 3.5 of this Agreement. Notwithstanding the termination or
non-renewal of this Agreement, the terms and conditions of this
Agreement shall continue to apply until the completion of Deconversion
(defined below).
12.2Deconversion. In the event that this Agreement is terminated or not
renewed, the Transfer Agent agrees that, in order to provide for
uninterrupted service to the Fund, the Transfer Agent shall, at the
Fund's request, offer reasonable assistance to the Fund in converting,
within a reasonable time frame agreed to by the parties, the Fund's
records from the Transfer Agent's systems to whatever services or
systems are designated by the Fund (the "Deconversion") (subject to the
recompense of the Transfer Agent for such assistance at their standard
rates and fees in effect at the time). As used herein "reasonable
assistance" and "transitional assistance" shall not include requiring
the Transfer Agent (i) to assist any new service or system provider to
modify, to alter, to enhance, or to improve such provider's system, or
to provide any new functionality to such provider's system, (ii) to
disclose any protected information of the Transfer Agent, except to the
extent necessary to effectuate such Deconversion and then, only
pursuant to a written confidentiality agreement executed between the
Transfer Agent and the new service provider, or (iii) to develop
Deconversion software, to modify any of the Transfer Agent's software,
or to otherwise alter the format of the data as maintained on any
provider's systems.
12.3Early Termination. Notwithstanding anything contained in this
Agreement to the contrary, should the Fund desire to move any of its
services provided by the Transfer Agent hereunder to a successor
service provider prior to the expiration of the Initial Term or then
current Renewal Term, the Transfer Agent shall make a good faith effort
to facilitate the conversion on such prior date; provided, however
that, except for a transfer following a termination pursuant to
Sections 12.6 or 12.7, there can be no guarantee or assurance that the
Transfer Agent will be able to facilitate a conversion of services on
such prior date. In connection with the foregoing, should services be
converted to a successor service provider, other than following a
termination pursuant to Sections 12.6 or 12.7, or if the Fund's assets
are merged or purchased or the like with or by another entity which
does not utilize the services of the Transfer Agent, then the Fund will
pay to the Transfer Agent an amount equal to twelve (12) months of the
Transfer Agent's fees immediately preceding the receipt of the
termination notice, plus, during the Initial Term only, the dollar
amount of the Transfer Agent's start up costs for the initial
conversion and implementation of the Fund, which amount shall be
reduced by 1/60 during each month of the Initial Term during which this
Agreement is in effect. The payment of one-half of all fees owing to
the Transfer Agent under this Section 12.3 shall be paid on or before
the business day immediately prior to the conversion or termination of
services, with the balance being due immediately upon conversion.
12.4Confidential Information. Upon termination of this Agreement, each
party shall return to the other party all copies of confidential or
proprietary materials or information received from such other party
hereunder, other than materials or information required to be retained
by such party under Applicable Law.
12.5Unpaid Invoices. The Transfer Agent may terminate this Agreement
thirty (30) days after notice to the Fund and its administrator that an
invoice has remained outstanding for more than sixty (60) days, except
with respect to any amount subject to a good faith dispute within the
meaning of Section 3.4 of this Agreement.
12.6Bankruptcy. This Agreement shall terminate, (a) by notice by the
notifying party in the event that the other party ceases to carry on
its business or (b) immediately, without further action by a party, in
the event that an action is commenced by or against the other party
under Title 11 of the United States Code or a receiver, conservator or
similar officer is appointed for the other party and such suit,
conservatorship or receivership is not discharged within thirty (30)
days.
12.7Cause. If either of the parties hereto is in default in the
performance of its duties or obligations hereunder, and such default
has a material effect on the other party, then the non-defaulting party
may give notice to the defaulting party specifying the nature of the
default in sufficient detail to permit the defaulting party to identify
and cure such default. If the defaulting party fails to cure such
default within thirty (30) days of receipt of such notice, or within
such longer period of time as the parties may agree is necessary for
such cure, then the non-defaulting party may terminate this Agreement
upon notice of not less than five (5) days to the defaulting party.
13. Assignment and Third Party Beneficiaries
13.1Except as provided in Section 14.1 below, neither this Agreement nor
any rights or obligations hereunder may be assigned or subcontracted by
either party without the written consent of the other party. Any
attempt to do so in violation of this Section shall be void. Unless
specifically stated to the contrary in any written consent to an
assignment, no assignment will release or discharge the assignor from
any duty or responsibility under this Agreement.
13.2Except as explicitly stated elsewhere in this Agreement, nothing under
this Agreement shall be construed to give any rights or benefits in
this Agreement to anyone other than the Transfer Agent and the Fund,
and the duties and responsibilities undertaken pursuant to this
Agreement shall be for the sole and exclusive benefit of the Transfer
Agent and the Fund. This Agreement shall inure to the benefit of and
be binding upon the parties and their respective permitted successors
and assigns.
13.3This Agreement does not constitute an agreement for a partnership or
joint venture between the Transfer Agent and the Fund. Other than as
provided in Section 14.1, neither party shall make any commitments with
third parties that are binding on the other party without the other
party's prior written consent.
14. Subcontractors
14.1 The Transfer Agent may, without further consent on the part of the
Fund, subcontract for the performance hereof with (i) Boston Financial
Data Services, Inc., a Massachusetts corporation ("Boston Financial")
which is duly registered as a transfer agent pursuant to Section
17A(c)(2) of the Securities Exchange Act of 1934, as amended, (ii) a
Boston Financial subsidiary duly registered as a transfer agent or
(iii) a Boston Financial affiliate duly registered as a transfer agent;
provided, however, that the Transfer Agent shall be fully responsible
to the Fund for the acts and omissions of Boston Financial or its
subsidiary or affiliate as it is for its own acts and omissions and
provided further, however, that any such subsidiary or affiliate shall
perform any and all services so subcontracted within the borders of the
United States.
14.1 Nothing herein shall impose any duty upon the Transfer Agent in
connection with or make the Transfer Agent liable for the actions or
omissions to act of unaffiliated third parties such as by way of
example and not limitation, Airborne Services, Federal Express, United
Parcel Service, the U.S. Mails, the NSCC and telecommunication
companies, provided, if the Transfer Agent selected such company, the
Transfer Agent shall have exercised due care in selecting the same.
15. Miscellaneous
15.1 Amendment. This Agreement may be amended or modified by a written
agreement executed by all parties hereto and authorized or approved by
a resolution of the Board of the Fund.
15.2 Massachusetts Law to Apply. This Agreement shall be construed and the
provisions thereof interpreted under and in accordance with the laws of
The Commonwealth of Massachusetts.
15.3 Force Majeure. In the event either party is unable to perform its
obligations under the terms of this Agreement because of acts of God,
strikes, equipment or transmission failure or damage reasonably beyond
its control, or other causes reasonably beyond its control, such party
shall not be liable for damages to the other for any damages resulting
from such failure to perform or otherwise from such causes; provided,
however, that nothing in this Section 15.3 shall be deemed to relieve
Transfer Agent of its obligations under Section 11.3.
15.4 Consequential Damages. Neither party to this Agreement shall be liable
to the other party for special, indirect or consequential damages under
any provision of this Agreement or for any special, indirect or
consequential damages arising out of any act or failure to act
hereunder. For purposes of this Agreement, any cost of reprocessing
transactions, of compensating Shareholders for losses of interest,
and/or reimbursement for fund dilution, in any case resulting from the
processing of trades at an incorrect NAV shall be deemed to be actual
damages and not special, indirect or consequential damages subject to
the limitation contained in this Section 15.4.
15.5 Survival. All provisions regarding indemnification, warranty,
liability, and limits thereon, and confidentiality and/or protections
of proprietary rights and trade secrets shall survive the termination
of this Agreement.
15.6 Severability. If any provision or provisions of this Agreement shall
be held invalid, unlawful, or unenforceable, the validity, legality,
and enforceability of the remaining provisions shall not in any way be
affected or impaired.
15.7 Priorities Clause. In the event of any conflict, discrepancy or
ambiguity between the terms and conditions contained in this Agreement
and any Schedules or attachments hereto, the terms and conditions
contained in this Agreement shall take precedence.
15.8 Waiver. No waiver by either party or any breach or default of any of
the covenants or conditions herein contained and performed by the other
party shall be construed as a waiver of any succeeding breach of the
same or of any other covenant or condition.
15.9 Merger of Agreement. This Agreement constitutes the entire agreement
between the parties hereto and supersedes any prior agreement with
respect to the subject matter hereof whether oral or written.
15.10 Counterparts. This Agreement may be executed by the parties hereto on
any number of counterparts, and all of said counterparts taken together
shall be deemed to constitute one and the same instrument.
15.11 Reproduction of Documents. This Agreement and all schedules, exhibits,
attachments and amendments hereto may be reproduced by any
photographic, photostatic, microfilm, micro-card, miniature
photographic or other similar process. The parties hereto each agree
that any such reproduction shall be admissible in evidence as the
original itself in any judicial or administrative proceeding, whether
or not the original is in existence and whether or not such
reproduction was made by a party in the regular course of business, and
that any enlargement, facsimile or further reproduction shall likewise
be admissible in evidence.
15.12
Notices. All notices and other communications as required or permitted
hereunder shall be in writing and sent by first class mail, postage
prepaid, addressed as follows or to such other address or addresses of
which the respective party shall have notified the other.
(a) If to the Transfer Agent, to:
State Street Bank and Trust Company
c/o Boston Financial Data Services, Inc.
0 Xxxxxxxx Xxxxx, 0xx Xxxxx
Xxxxx Xxxxxx, XX 00000
Attn: Xxxxx Xxxxxxx
(b) If to the Fund, to:
[Name of Fund]
0000 Xxxxxxxxx Xxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: President
With a copy to:
Federated Investors, Inc.
0000 Xxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: General Counsel
16. Additional Funds
In the event that the Fund establishes one or more series of Shares, in
addition to those listed on the attached Schedule A, with respect to
which it desires to have the Transfer Agent render services as transfer
agent under the terms hereof, it shall so notify the Transfer Agent in
writing, and if the Transfer Agent agrees in writing to provide such
services, such series of Shares shall become a Portfolio hereunder.
17. Limitation of Liability of Trustees and Shareholders of the Fund
The execution and delivery of this Agreement have been authorized by
the Board of the Fund and signed by an authorized officer of such Fund,
acting as such, and neither such authorization by the Board nor the
execution and delivery by such officer shall be deemed to have been
made by any of them individually or to impose any liability on any of
them personally, and the obligations of this Agreement are not binding
upon any of the members of the Board of the Fund, but bind only the
property of the Fund as provided in, as applicable, the Fund's articles
of incorporation or declaration of trust.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in their names and on their behalf by and through their duly
authorized officers, as of the day and year first above written.
STATE STREET BANK AND By each of the Federated Funds
TRUST COMPANY set forth on Exhibit A
By: /s/ Xxxxxx X. Xxxxxx By: /s/ J. Xxxxxxxxxxx Xxxxxxx
--------------------------- ---------------------------------
Name: Xxxxxx X. Xxxxxx Name: J. Xxxxxxxxxxx Xxxxxxx
Title: Executive Vice President Title:
President
- 29
-EXHIBIT A
EXHIBIT A
FEDERATED FUNDS
Exhibit is filed separately, quarterly.
EXHIBIT B
FORM OF
UNCERTIFICATED SECURITIES CONTROL AGREEMENT
This Uncertificated Securities Control Agreement (this "Agreement") dated as
of __________, 200_ among __________________, a ______________ corporation
("Debtor"), ____________________ ("Secured Party"), and Boston Financial Data
Services, Inc., a Massachusetts corporation (the "Transfer Agent").
WHEREAS, Debtor owns shares in __________________ (the "Issuer"),
which for internal record keeping are designated as being held in account
number ____________ (the "Account"). The shares in the Issuer are
uncertificated securities and shares owned from time to time by Debtor in the
Issuer are and will be registered in the name of Debtor on the books and
records of Issuer maintained with the Transfer Agent.
WHEREAS, Secured Party has entered into a Credit Agreement with
Debtor (as amended, restated, supplemented or otherwise modified from time to
time, the "Credit Agreement").
WHEREAS, Debtor and the Secured Party have entered into a
Security Agreement (as from time to time amended, restated, supplemented or
otherwise modified, the "Security Agreement"), in which inter alia, Debtor
has granted to Secured Party a security interest in the shares in the Issuer
held from time to time by Debtor (the "Pledged Shares").
WHEREAS, Secured Party, Debtor and the Transfer Agent, on behalf
of the Issuer, are entering into this Agreement to provide for the control of
the Pledged Shares and to perfect the security interest of Secured Party in
the Pledged Shares owned by Debtor from time to time.
NOW THEREFORE, intending to be legally bound hereby, the parties
hereto agree as follows:
Section 1. The Pledged Shares. Attached hereto as Exhibit A is the
---------
[Confirmation statement][Account statement] dated ______________, 200_,
provided to Debtor confirming Debtor's [purchase/ownership] of the Pledged
Shares.
Section 2. No Redemptions. Transfer Agent shall neither accept
nor comply with any instructions from Debtor redeeming any Pledged Shares nor
deliver any proceeds from any such redemption to Debtor following
Confirmation (as hereinafter defined) of receipt of a Notice of Exclusive
Control (as hereinafter defined) from Secured Party unless Secured Party
shall have withdrawn such notice in writing.
Section 3. Priority of Lien. Transfer Agent consents to the
granting of the security interest in the Pledged Shares. Transfer Agent will
not agree with any third party that Transfer Agent will comply with
instructions concerning the Pledged Shares originated by such third party
without the prior written consent of Secured Party and Debtor.
Section 4. Indemnification of the Issuer and Transfer Agent.
Debtor hereby agrees that Debtor and its successors and assigns shall at all
times indemnify and save harmless Issuer and Transfer Agent from and against
any and all claims, actions and suits of others arising out of the terms of
this Agreement or the compliance of Transfer Agent with the terms hereof,
except to the extent that such arises from Transfer Agent's gross negligence,
willful misconduct or bad faith, and from and against any and all
liabilities, losses, damages, costs, charges, counsel fees and other expenses
of every nature and character arising by reason of the same. Secured Party
hereby agrees that Secured Party and its successors and assigns shall at all
times indemnify and save harmless Issuer and Transfer Agent from and against
any and all claims, actions and suits of others arising out of the execution
by Transfer Agent of any instructions initiated by Secured Party with respect
to the Account and/or the Pledged Shares, including any actions taken in
response to a Notice of Exclusive Control, except to the extent that such
arises from Transfer Agent's gross negligence, willful misconduct or bad
faith, and from and against any and all liabilities, losses, damages, costs,
chargers, counsel fees and other expenses of every nature and character
arising by reason of the same.
Section 5. Control. Transfer Agent will comply with instructions
originated by Secured Party concerning the Pledged Shares without further
consent by Debtor. Except as otherwise provided in Section 2 above, Transfer
Agent shall redeem the Pledged Shares at the instruction of Debtor, or its
authorized representatives, and comply with instructions concerning purchases
of additional shares, which will become Pledged Shares, received from Debtor,
or its authorized representatives, until such time as Transfer Agent receives
from Secured Party (as determined by reference to Section 16 hereof) a
written notice in the form of Exhibit B hereto to Transfer Agent which states
that Secured Party is exercising exclusive control over the Pledged Shares.
Such notice is referred to herein as the "Notice of Exclusive Control."
After Transfer Agent receives a Notice of Exclusive Control (as determined by
reference to Section 16 hereof), Transfer Agent will re-register the Pledged
Shares in the name of the Secured Party, and will cease complying with all
instructions concerning the Pledged Shares originated by Debtor or its
representatives, until Transfer Agent shall have received a written notice in
the form of Exhibit C hereto, after which Transfer Agent will again register
the Pledged Shares in the name of Debtor and may once again comply with all
instructions concerning the Pledged Shares originated by Debtor or its
representatives.
Section 6. Statements, Confirmations and Notices of Adverse
Claims. Transfer Agent will send copies of all monthly statements and daily
confirmations concerning the Pledged Shares simultaneously to each of Debtor
and Secured Party at the addresses set forth in Section 16 of this
Agreement. If any person asserts any lien, encumbrance or adverse claim
against any of the Pledged Shares, Transfer Agent will promptly notify
Secured Party and Debtor thereof.
Section 7. Responsibility of Transfer Agent. Transfer Agent
shall have no responsibility or liability to Secured Party for redeeming
Pledged Shares at the instruction of Debtor, or its authorized
representatives, or complying with instructions in accordance with Section 5
above concerning the Pledged Shares from Debtor, or its authorized
representatives, which are received by Transfer Agent before Transfer Agent
issues a Confirmation of a Notice of Exclusive Control. Transfer Agent shall
have no responsibility or liability to Debtor for complying with a Notice of
Exclusive Control or complying with instructions concerning the Pledged
Shares originated by Secured Party. Transfer Agent shall have no duty to
investigate or make any determination as to whether the conditions for the
issuance of a Notice of Exclusive Control contained in any agreement between
Debtor and Secured Party have occurred. Neither this Agreement nor the
Security Agreement imposes or creates any obligation or duty of Issuer or
Transfer Agent other than those expressly set forth herein.
Section 8. Tax Reporting. All items of income and gain
recognized on the Pledged Shares shall be reported to the Internal Revenue
Service and all state and local taxing authorities under the name and
taxpayer identification number of Debtor.
Section 9. Customer Application; Jurisdiction. This Agreement
supplements the conventional account establishment documents between Transfer
Agent or Issuer on the one hand, and Debtor on the other hand (the "Customer
Application"). Regardless of any provision in the Customer Application, the
Commonwealth of Massachusetts shall be deemed to be Issuer's jurisdiction for
the purposes of this Agreement and the perfection and priority of Secured
Party's security interest in the Pledged Shares.
Section 10. Termination. The rights and powers granted herein
to Secured Party have been granted in order to perfect its security interest
in the Pledged Shares, are powers coupled with an interest and will neither
be affected by the bankruptcy or insolvency of Debtor nor by the lapse of
time. The obligations of Transfer Agent under Sections 2, 3, 5 and 6 above
shall continue in effect until the security interest of Secured Party in the
Pledged Shares has been terminated pursuant to the terms of the Security
Agreement and Secured Party has notified Transfer Agent of such termination
in writing or all Pledged Shares shall have been redeemed by the Secured
Party. Upon receipt of such notice, the obligations of Transfer Agent under
Sections 2, 3, 5 and 6 above shall terminate, Secured Party shall have no
further right to originate instructions concerning the Pledged Shares and
Transfer Agent may take such steps as Debtor may request to vest full
ownership and control of the Pledged Shares in Debtor, including, but not
limited to, transferring all of the Pledged Shares to Debtor or its designee.
Section 11. This Agreement. This Agreement, the schedules and
exhibits hereto and the agreements and instruments required to be executed
and delivered hereunder (including the Customer Application) set forth the
entire agreement of the parties hereto with respect to the subject matter
hereof and supersede and discharge all prior agreements (written or oral) and
negotiations and all contemporaneous oral agreements concerning such subject
matter and negotiations. There are no oral conditions precedent to the
effectiveness of this Agreement.
Section 12. Amendments. No amendment, modification or
termination of this Agreement or waiver of any right hereunder shall be
binding on any party hereto unless it is in writing and is signed by the
party to be charged.
Section 13. Severability. If any term or provision set forth in
this Agreement shall be invalid or unenforceable, the remainder of this
Agreement, or the application of such terms or provisions to persons or
circumstances, other than those to which it is held invalid or unenforceable,
shall be construed in all respects as if such invalid or unenforceable term
or provision were omitted.
Section 14. Successors. The terms of this Agreement shall be
binding upon, and shall inure to the benefit of, the parties hereto and their
respective corporate successors or assigns.
Section 15. Rules of Construction. In this Agreement, words in
the singular number include the plural, and in the plural include the
singular; words of the masculine gender include the feminine and the neuter,
and when the sense so indicates words of the neuter gender may refer to any
gender and the word "or" is disjunctive but not exclusive. The captions and
section numbers appearing in this Agreement are inserted only as a matter of
convenience. They do not define, limit or describe the scope or intent of
the provisions of this Agreement.
Section 16. Notices. Except with respect to any Notice of
Exclusive Control, each other notice, request or other communication given to
any party hereunder shall be in writing (which term includes facsimile or
other electronic transmission) and shall be effective (i) when delivered to
such party at its address specified below, (ii) when sent to such party by
facsimile or other electronic transmission, addressed to it at its facsimile
number or electronic address specified below, and electronic confirmation of
error-free receipt is received or (iii) two days after being sent to such
party by certified or registered United States mail, addressed to it at its
address specified below, with first class or airmail postage prepaid. With
respect to a Notice of Exclusive Control, the Secured Party shall be required
to telephone the Transfer Agent, at the telephone number set forth below, in
advance of the delivery of any such Notice of Exclusive Control, which
telephone call shall be promptly followed in writing by a Notice of Exclusive
Control sent by facsimile to the Transfer Agent at the facsimile number set
forth below. Such Notice of Exclusive Control shall not be deemed to have
been received by the Transfer Agent or Issuer for any purpose hereunder,
including but not limited to Section 5, unless and until the Transfer Agent
provides a written confirmation of receipt, specifically acknowledging that
the Notice of Exclusive Control has been received and acted upon by the
Transfer Agent (hereinafter, a "Confirmation"). In the event that the
Secured Party shall not have received such Confirmation within ten minutes
following delivery of a Notice of Exclusive Control, Secured Party must
telephone the Transfer Agent in order to determine the status of such
Confirmation.
Secured Party:
=======================
-----------------------
Attention: _______________
Telephone: ______________
Facsimile: _______________
Debtor:
=======================
-----------------------
Attention: _______________
Telephone: ______________
Facsimile: _______________
Transfer Agent:
Boston Financial Data Services, Inc.
0 Xxxxxxxx Xxxxx
Xxxxx Xxxxxx, XX 00000
Attention: _______________
Telephone: ______________
Facsimile: _______________
Any party may change its address for notices in the manner set forth above.
Section 17. Counterparts. This Agreement may be executed in any
number of counterparts (including by means of facsimile), all of which shall
constitute one and the same instrument, and any party hereto may execute this
Agreement by signing and delivering one or more counterparts.
Section 18. Choice of Law. The validity, terms, performance and
enforcement of this Agreement shall be governed by the laws of the
[State/Commonwealth] of [Issuer's jurisdiction of incorporation].
Section 19. Representations by Transfer Agent. The Transfer
Agent hereby represents and warrants to the Secured Party that (a) it is duly
authorized to execute and deliver this Agreement on behalf of the Issuer and
(b) this Agreement shall constitute the legal, valid and binding obligation
of the Issuer enforceable against it in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors' rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the parties have executed this Agreement as
of the date first set forth above.
, as Secured Party
------------------------------------------------------------
By:
---------------------------------
Duly Authorized Signatory
, as Debtor
------------------------------------------------------------
By:
---------------------------------
Title:
------------------------
Boston Financial Data Services, Inc., as
Transfer Agent
By:
---------------------------------
Title:
------------------------------
Exhibit A
Confirmation/Account Statement
EXHIBIT B - PAGE 2
Exhibit B
Form of Notice of Exclusive Control
__________, 200__
Boston Financial Data Services, Inc.
0 Xxxxxxxx Xxxxx
Xxxxx Xxxxxx, XX 00000
Attention: _______________
Ladies and Gentlemen:
Reference is made to the Uncertificated Securities Control
Agreement, dated as of _______, 200_ ( the "Control Agreement"), among
______________ ("Debtor"), _____________________, as Secured Party (the
"Secured Party") and Boston Financial Data Services, Inc. ("Transfer
Agent"). Capitalized terms not defined herein shall have the meanings
ascribed to them in the Control Agreement.
Confirming our telephone conversation of a few minutes ago
and pursuant to the terms of the Control Agreement, Transfer Agent is
hereby directed to accept instructions or otherwise take or refrain
from taking action with respect to the Pledged Shares only as directed
by the Secured Party unless and until a Revocation Notice has been
delivered to Transfer Agent by the Secured Party. The Secured Party
hereby directs Transfer Agent to cease complying with any instructions
concerning the Pledged Shares originated by Debtor or its
representatives.
Very truly yours,
, as Secured
Party
By:
------------------------------
Name:
Title:
Exhibit C
Form of Revocation Letter
____________, 200__
Boston Financial Data Services, Inc.
0 Xxxxxxxx Xxxxx
Xxxxx Xxxxxx, XX 00000
Attention: _______________
Ladies and Gentlemen:
Reference is hereby made to the Uncertificated Securities
Control Agreement, dated as of ___________, 200_ (the "Control Agreement"),
among _______________ ("Debtor"), _________________________, as Secured Party
(the "Secured Party") and Boston Financial Data Services, Inc. ("Transfer
Agent"). Capitalized terms not defined herein shall have the meanings
ascribed to them in the Control Agreement.
Please be advised that the Notice of Exclusive Control
dated ___________, 200__ is hereby revoked and that Transfer Agent may once
again comply, subject to the terms and conditions of the Control Agreement,
with instructions concerning the Pledged Shares originated by Debtor or its
representatives unless and until Transfer Agent receives a Notice of
Exclusive Control dated after the date hereof from the Secured Party.
Very truly yours,
, as Secured Party
---------------------------------------------------------
By:
---------------------
Name:
Title:
SCHEDULE A
SCHEDULE A
FEDERATED FUNDS
Prime Obligations Fund
Prime Value Obligations Fund
Prime Cash Obligations Fund
Treasury Obligations Fund
U.S. Treasury Cash Reserves
Government Obligations Fund
Tax-Free Obligations Fund
Automated Cash Management Trust
California Municipal Cash Trust
Municipal Obligations Fund
Government Obligations Tax Managed Fund
Automated Government Money Trust
Prime Cash Series
Tax Free Instruments Trust
Georgia Municipal Cash Trust
Automated Government Cash Reserves
Minnesota Municipal Cash Trust
Alabama Municipal Cash Trust
Michigan Municipal Cash Trust
North Carolina Municipal Cash Trust
Pennsylvania Municipal Cash Trust
Trust for U.S. Treasury Obligations
Liberty U.S. Government Money Market Trust
Liquid Cash Trust
Automated Treasury Cash Reserves
Government Cash Series
Federated Tax-Free Trust
Treasury Cash Series
Virginia Municipal Cash Trust
Florida Municipal Cash Trust
Arizona Municipal Cash Trust
Money Market Trust
Connecticut Municipal Cash Trust
Federated Short-Term U.S. Government Trust
Federated Master Trust
Trust for Short-Term U.S. Government Securities
Maryland Municipal Cash Trust
Municipal Cash Series
Trust for Government Cash Reserves
Massachusetts Municipal Cash Trust
New York Municipal Cash Trust
Ohio Municipal Cash Trust
Treasury Cash Series II
New Jersey Municipal Cash Trust
Municipal Cash Series II
Federated Prime Money Fund II
Money Market Management
Federated Xxxxxxxx Fund
Federated Muni and Stock Advantage Fund
Federated International Capital Appreciation Fund
Federated Xxxxxxxx Small Cap Fund
Federated Xxxxxxxx Fund II
Federated European Equity Fund
Federated Capital Appreciation Fund II
Federated Global Value Fund
Federated Mid-Cap Fund
Federated Global Equity Fund
Federated Mini-Cap Fund
Federated Max-Cap Fund
Federated Technology Fund
Federated International Value Fund
Federated Capital Appreciation Fund
Federated American Leaders Fund, Inc.
Federated Stock Trust
Federated Market Opportunity Fund
Federated Equity Income Fund, Inc
Federated International Small Company Fund
Federated Growth Strategies Fund
Federated Capital Income Fund, Inc.
Federated International Equity Fund
Federated American Leaders Fund II
Federated Stock and Bond Fund, Inc
Federated Large Cap Growth Fund
Federated Moderate Allocation Fund
Federated Conservative Allocation Fund
Federated Growth Allocation Fund
Federated Capital Income Fund II
Federated Equity Income Fund II
Federated Growth Strategies Fund II
Federated International Equity Fund II
Federated Ultrashort Bond Fund
Federated Municipal Ultrashort Fund
Federated Government Ultrashort Duration Fund
Federated Total Return Bond Fund
Federated Government Income Securities, Inc.
Federated Bond Fund
Federated US Government Securities Fund: 1-3 Years
Federated Total Return Government Bond Fund
Federated High Yield Trust
Federated Mortgage Fund
Federated International Bond Fund
Federated Adjustable Rate Securities Fund
Federated Strategic Income Fund
Federated International High Income Fund
Federated Intermediate Municipal Trust
Federated Intermediate Corporate Bond Fund
Federated Limited Duration Fund
Federated Limited Duration Government Fund, Inc.
Federated Short-Term Municipal Trust
Federated California Municipal Income Fund
Federated Limited Term Municipal Fund
Federated Michigan Intermediate Municipal Trust
Federated Pennsylvania Municipal Income Fund
Federated Institutional High Yield Bond Fund
Federated New York Municipal Income Fund
Federated Ohio Municipal Income Fund
Federated North Carolina Municipal Income Fund
Federated Limited Term Fund
Federated Short-Term Income Fund
Federated U.S. Government Bond Fund
Federated Quality Bond Fund II
Federated Total Return Bond Fund II
Federated Income Trust
Federated GNMA Trust
Federated Fund for U.S. Government Securities II
Federated High Income Bond Fund, Inc.
Capital Preservation Fund
Federated Fund for U.S. Government Securities
Federated US Government Securities Fund: 2-5 Years
Federated Municipal Securities Fund, Inc.
Federated Municipal Opportunities Fund, Inc.
Federated High Income Bond Fund II
High Yield Bond Portfolio
SCHEDULE 2.1
SERVICE LEVEL STANDARDS
See attached
SCHEDULE 2.2(f)
AML DELEGATION
DATED: July 1, 2004
1. Delegation. In connection with the enactment of the Uniting and
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Strengthening America by Providing Appropriate Tools Required to
Intercept and Obstruct Terrorism Act of 2001 and the regulations
promulgated thereunder, (collectively, the "USA PATRIOT Act"), the Fund
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has developed and implemented a written anti-money laundering program
(the "AML Program"), which is designed to satisfy the requirements of
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the USA PATRIOT Act. Under the USA PATRIOT Act, a mutual fund can
elect to delegate certain duties with respect to the implementation and
operation of its AML Program to a service provider, including its
transfer agent. The Fund is desirous of having the Transfer Agent
perform certain delegated duties pursuant to the AML Program and the
Transfer Agent desires to accept such delegation. Transfer Agent
acknowledges and agrees that, because the Fund remains responsible for
assuring compliance with the USA PATRIOT Act and the AML Program, the
Transfer Agent shall provide such information and reports to the Fund's
designated compliance officer as may from time to time be reasonably
requested by the Fund and, in addition, shall provide such compliance
officer with notice of any contact by any regulatory authority.
2. Limitation on Delegation. The Fund acknowledges and agrees that in
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accepting the delegation hereunder, the Transfer Agent is agreeing to
perform only those duties that have been expressly delegated on this
Schedule 2.2(f) (the "Delegated Duties"), as may be amended from time
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to time, and is not undertaking and shall not be responsible for any
other aspect of the AML Program or for the overall compliance by the
Fund with the USA PATRIOT Act or for any other matters that have not
been delegated hereunder. Additionally, the parties acknowledge and
agree that the Transfer Agent shall only be responsible for performing
the Delegated Duties with respect to the ownership of, and transactions
in, shares in the Fund for which the Transfer Agent maintains the
applicable shareholder information.
3. Consent to Examination. In connection with the performance by the
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Transfer Agent of the Delegated Duties, the Transfer Agent understands
and acknowledges that the Fund remains responsible for assuring
compliance with the USA PATRIOT Act and that the records the Transfer
Agent maintains for the Fund relating to the AML Program may be
subject, from time to time, to examination and/or inspection by federal
regulators in order that the regulators may evaluate such compliance.
The Transfer Agent hereby consents to such examination and/or
inspection and agrees to cooperate with such federal examiners in
connection with their review. For purposes of such examination and/or
inspection, the Transfer Agent will use its best efforts to make
available, during normal business hours and on reasonable notice all
required records and information for review by such examiners.
4. Delegated Duties
4.1 With respect to the beneficial ownership of, and transactions in,
shares in the Fund for which the Transfer Agent maintains the
applicable shareholder information, the Transfer Agent shall:
SCHEDULE 2.2(f)
AML DELEGATION
(continued)
(a) Submit all new account and registration maintenance transactions
through the Office of Foreign Assets Control ("OFAC") database and such
other lists or databases of trade restricted individuals or entities as
may be required from time to time by applicable regulatory authorities.
(b) Submit special payee checks through the OFAC database.
(c) Review redemption transactions that occur within thirty (30) days
of account establishment or maintenance.
(d) Review wires sent pursuant to banking instructions other than those
on file with the Transfer Agent.
(e) Review accounts with small balances followed by large purchases.
(f) Review accounts with frequent activity within a specified date
range followed by a large redemption.
(g) On a daily basis, review purchase and redemption activity per tax
identification number ("TIN") within the Funds to determine if activity
for that TIN exceeded the $100,000 threshold on any given day.
(h) Compare all new accounts and registration maintenance through the
Known Offenders database and notify the Fund of any match.
(i) Monitor and track cash equivalents under $10,000 for a rolling
twelve-month period and file IRS Form 8300 and issue the shareholder
notices required by the IRS.
(j) Determine when a suspicious activity report ("SAR") should be filed
as required by regulations applicable to mutual funds; prepare and file
the SAR. Provide the Fund with a copy of the SAR within a reasonable
time after filing; notify the Fund if any further communication is
received from U.S. Department of the Treasury or other law enforcement
agencies regarding the SAR.
(k) Compare account information to any FinCEN request received by the
Fund and provided to the Transfer Agent pursuant to the USA PATRIOT Act
Sec. 314(a). Provide the Fund with documents/information necessary to
respond to requests under USA PATRIOT Act Sec. 314(a) within required
time frames.
(l) Verify the identity of any person seeking to open an account with
the Fund, (ii) Maintain records of the information used to verify the
person's identity and (iii) Determine whether the person appears on any
lists of known or suspected terrorists or terrorists organizations
provided to the Fund by any government agency.
4.2 In the event that the Transfer Agent detects suspicious activity as a
result of the foregoing procedures, which necessitates the filing by
the Transfer Agent of a suspicious activity report, a Form 8300 or
other similar report or notice to OFAC, then the Transfer Agent shall
also immediately notify the Fund, unless prohibited by Applicable Law.
SCHEDULE 2.2(g)
CHECKWRITING SERVICES SUPPORT
(i) Upon receipt of checkwriting signature cards, code the appropriate
Shareholder account on Transfer Agent's recordkeeping systems for
checkwriting services, order appropriate checkbook products through MICR's
online checkbook ordering system, and process the signature card, including
manually inserting the fourteen-digit account number for such Shareholder on
each such signature card, scanning such signature card into the Automated
Work Distributor system ("AWD") and sending the original signature card to
United Missouri Bank, N.A. ("UMB") for safekeeping;
(ii) Utilize UMB's UNITEPlus system for daily settlement with UMB of checks
presented against a Shareholder's account, transmitting the aggregate
settlement amount for all check presentments on each business day on which
UMB is open for business, less the amount of any check presentments rejected
from the prior business day;
(iii) Utilize UMB's systems for review of accounts and processing of items
rejected by UMB;
(iv) In accordance with Proper Instructions, place stop payment orders on
specified checks utilizing the online systems of UMB;
(v) Provide information to UMB, on each business day, as to the current
collected balance in specified Shareholder accounts;
(vi) With respect to checks that are rejected by UMB for reasons other than
insufficient Shareholder account balance, perform the following services each
business day, as applicable:
(A) For checks with faulty MICR encoding, incorrect formatting (1)
perform a search of the Fund's records, maintained on Transfer Agent's
recordkeeping systems, for open Shareholder accounts matching the
available identifying Shareholder information on such check and (x) if
no corresponding Shareholder account can be located, generate and send
a report of such item to UMB, (y) if a corresponding Shareholder
account can be located and the account of the Shareholder has a
sufficient balance against which to process such check, instruct UMB to
pay such check and (z) if a corresponding Shareholder account can be
located and the account of the Shareholder does not have a sufficient
balance against which to process such check, instruct UMB to return
such check to the Shareholder, (2) review each item to determine the
cause of the rejection and perform the following additional steps (x)
if the cause was incorrect formatting or faulty MICR data, and the
shareholder utilized a third party vendor or software platform, inform
the Shareholder of the problem and advise the Shareholder to destroy
remaining check stock, and, if requested by the Shareholder, order a
new checkbook for such Shareholder and (y) if the cause was due to a
check being written by a Shareholder against a Fund that no longer
offers checkwriting privileges, inform the client of the problem and
advise the client to destroy remaining check stock.
(B) For checks that are reported as duplicate check entries, (1) if the
check can be viewed on UMB's on-line system, view the check on-line in
order to determine whether they are duplicative and (x) if not
duplicative, confirm whether the Shareholder's account has a sufficient
balance to honor the check and, if so, instruct UMB to pay the check,
(y) if not duplicative, confirm whether the Shareholder's account has a
sufficient balance to honor the check and, if not, instruct UMB to
reject the check, and (z) if duplicative, instruct UMB to reject the
check, and (2) if the check cannot be viewed on UMB's on-line systems,
contact the financial intermediary through which the Shareholder is
transacting, if applicable, or the Shareholder if no financial
intermediary is involved, and verify whether the potentially
duplicative check is legitimate and (x) if verified to be legitimate by
either such means, instruct UMB to pay such check and manually deduct
the amount of such check from the Shareholder's account for settlement
with UMB on the next business day, (y) if the Shareholder or financial
intermediary indicates that the check is forged or fraudulent, instruct
UMB to reject the check and report the matter to the risk management
function within Federated Services Company and (z) if the Shareholder
or financial intermediary cannot be contacted, present the check for
further review.
(vii) With respect to checks that are rejected by UMB for reasons of
insufficient Shareholder account balance ("NSF Checks"), perform the
following services each business day, as applicable:
(A) With respect to NSF Checks written by Shareholders whose accounts
are maintained (x) by a broker/dealer that has executed an indemnity in
favor of Transfer Agent in form and substance satisfactory to Transfer
Agent ("Brokers") and (y) by Federated Securities Corp. ("FSC"):
(1) Compile a daily list of NSF Checks, sorted by Broker name
(including FSC, as applicable), and transmit such list to the
respective Broker (including FSC, as applicable);
(2) Accept instructions from such Brokers (including FSC, as
applicable) until 12:30 p.m. (Eastern) on each business day as to
the disposition of each such NSF Check (the "Pay or Bounce
Instructions");
(3) Transmit all Pay or Bounce Instructions received by 12:30
p.m. (Eastern) on such business day to UMB by 1:00 p.m. (Eastern)
on such business day;
(4) Create a same day wire purchase, or perform a current day
transfer or exchange, in accordance with instructions specified
in each Pay or Bounce Instruction (the "Deficit True-Up
Transaction"), and post this information to the "Trade Pending"
status information field on Transfer Agent's recordkeeping
systems;
(5) Confirm settlement of each Deficit True-Up Transaction
(either receipt of wire or processing of transfer or exchange);
(6) Create a checkwriting redemption against the "Trade Pending"
status information field on the Transfer Agent's recordkeeping
systems; and
(7) In the event that an additional checkwriting check is
presented against a Shareholder account on the date an NSF Check
for such Shareholder and with respect to which the Pay or Bounce
Instruction has already been given, submit a "Resubmittal" report
to the applicable Broker (including FSC, as applicable),
indicating the new Shareholder account balance after giving
effect to the prior Pay or Bounce Instruction.
(B) With respect to NSF Checks written by Shareholders whose accounts
are maintained by a broker/dealer that has not executed an indemnity in
favor of Transfer Agent, instruct UMB to bounce or reject such NSF
Check.
SCHEDULE 2.2(h)
DEBIT CARD SERVICES/ACH TRANSACTIONS SUPPORT
(A) Debit Card Services.
(i) Upon receipt of applications for debit card services, code the
appropriate Shareholder account on Transfer Agent's recordkeeping
systems for debit card services and process the application, including
manually inserting the fourteen-digit account number for such
Shareholder on the application, scanning such application into the AWD
and sending a copy of the application to UMB;
(ii) Utilize UMB's UNITEPlus system for daily settlement with UMB of
debit card transactions presented against a Shareholder's account,
transmitting the aggregate settlement amount for all such presentments
on each business day on which UMB is open for business;
(iii) Utilize UMB's systems for review of accounts and processing of
items rejected by UMB;
(iv) Review daily reject reports from UMB and make any and all
necessary adjustments to Shareholder accounts.
(B) Automated Clearing House System ("ACH") Transactions. Transfer Agent
will provide the following services in support of ACH transactions:
(i) Utilize UMB's UNITEPlus system for daily settlement with UMB of
ACH transactions presented against a Shareholder's account,
transmitting the aggregate settlement amount for all ACH transactions
on each business day on which UMB is open for business, less the amount
of any ACH transactions rejected from the prior business day; and
(iii) Utilize UMB's systems for review of accounts and processing of
ACH transaction items rejected by UMB.
It is recognized that there are electronic alternatives to traditional
paper checks, including those transactions processed through the ACH.
The settlements referred to in (B)(I) and (B)(ii) of this Schedule
2.2(h), together with any such electronic checks processed as ACH
transactions, will be included in daily settlement amounts communicated
between Transfer Agent and UMB under Schedule 2.2(g), and processing of
these transactions will otherwise be handled according to the terms of
such Schedule 2.2(g).
SCHEDULE 2.4
FUNCTIONAL MATRIX
See attached
SCHEDULE 3.1
FEES
Effective As set forth in Section 3.5 of the Agreement to which this
Schedule is attached.
Limitation on Liability: In accordance with the provisions of Section 9.2
of the Agreement to which this Schedule 3.1 is attached, the parties hereto
agree that there shall be no limitations on the liability of the Transfer
Agent under the Agreement.
Under and pursuant to the provisions of Section 3.1 of the Agreement to
which this Schedule is attached, the parties agree that the Fees for the
services to be provided under such Agreement shall be as follows:
Fee Type Annual Fee
Complex Base Fee $6,500,000
Per CUSIP Fee $13,040(1) For Each CUSIP
Annual Maintenance Fees
Direct Accounts; Daily Dividend $9.00 Per Account
Direct Accounts; Non-Daily Dividend $8.00 Per Account
Matrix Level III; Daily Dividend $6.00 Per Account
Matrix Level III; Non-Daily Dividend $5.00 Per Account
Telephone Servicing
Complex Base Fee(2) $2,700,000(3)
In addition to the Annual Fees set forth above, the following fees will
also be applicable:
Usage fee for telephone servicing:
Per Call Charge $5.00 (For each call in excess of
62,250 in any month)
Xxxxxxxx Fund (K Share) fees:
Open account fee $8.39/per account per year (in
addition to the per account fees
referenced above)
Correspondence $5.25/letter
Manual transaction fee $2.62/transaction
Research $3.67/source
SCHEDULE 3.2
OUT-OF-POCKET EXPENSES
The Fund shall be responsible for its portion (either based upon actual usage
where such usage can be definitively determined or on an equitably allocated
basis where all Funds enjoy the same benefits) of expenses incurred by the
Transfer Agent for the benefit of the Funds and/or the shareholders of the
Funds, including but not limited to the following: (a) All shareholder
recordkeeping system charges and expenses, including charges for the
maintenance and/or storage of shareholder records, trading information,
programming charges and other shareholder trading and lookup enhancements,
including DST's TA 2000 system, FANWeb, Vision, as in existence on the date
hereof, together with such changes as may be agreed to in writing by the Fund
from time to time during the Term, (b) all costs and expenses for
typesetting, printing, processing, coalating and mailing (including postage
and/or courier charges) of documents, legally required to be delivered to
shareholders, that the Transfer Agent is required to deliver hereunder or
that have been requested by shareholders, (c) costs and expenses related to
the provision of customer services to shareholders in the Trusts and/or
financial intermediaries, including but not limited to phone line charges,
datacom charges, facsimile line charges, (d) membership fees, per CUSIP fees,
and costs and expenses charged by the National Securities Clearing
Corporation with respect to trades placed and/or cleared through such
systems, (e) per transaction expenses incurred in connection with wires, ACH
transactions, checkwriting transactions and availability, debit card
transactions and availability, check processing, and escheatment, (f) costs
and expenses associated with printing, mailing, production and replacement of
checkbooks for shareholders electing checkwriting services, (g) costs and
expenses incurred at the specific direction of the Funds or required by a
regulatory organization and other out-of-pocket expenses deemed to be
properly payable by the Fund administrator's treasury department, (h)
professional services costs and expenses associated with the performance of
the annual SAS70 of the Transfer Agent and such other audits, compliance
checks and other professional services required by the Funds to be performed
with respect to the Transfer Agent, and (i) costs of shareholder servicing
enhancements, enhancements specific to trading with a particular financial
intermediary with the purpose of increasing assets in or promoting efficiency
in the trading with a given Fund, systems automation costs and expenses that
promote increases in shareholder servicing and/or processing efficiency or
that cause a net reduction in overall fund expenses.
(1) The Per CUSIP Fee shall be waived for the first six (6) months of the
Initial Term (as defined in the Agreement) with respect to all new CUSIPs.
(2) For up to 62,250 calls per month.
(3) This amount shall be fixed for the first two years of the Initial Term
(as defined in the Agreement), but may thereafter be changed by mutual
written agreement of the parties to the Agreement.
