Exhibit 13(M)
AGENCY AGREEMENT
THIS AGREEMENT made the 30th day of November, 2000, by and between each of
the following registered investment companies (1) LEXINGTON MONEY MARKET TRUST,
a Massachusetts business trust; (2) PILGRIM EQUITY TRUST, a Massachusetts
business trust, currently consisting of Pilgrim Index Plus Protection Fund and
Pilgrim MidCap Opportunities Fund; (3) PILGRIM GROWTH OPPORTUNITIES FUND, a
Massachusetts business trust; (4) PILGRIM MAYFLOWER TRUST, a Massachusetts
business trust, consisting of Pilgrim Growth + Value Fund, Pilgrim International
Value Fund and Pilgrim Research Enhanced Index Fund; (5) PILGRIM NATURAL
RESOURCES TRUST, a Massachusetts business trust; (6) PILGRIM PRIME RATE TRUST, a
Massachusetts business trust; (7) PILGRIM SMALLCAP OPPORTUNITIES FUND, a
Massachusetts business trust; (8) PILGRIM VARIABLE PRODUCTS TRUST, a
Massachusetts business trust, consisting of Pilgrim VP Convertible Portfolio,
Pilgrim VP Emerging Countries Portfolio, Pilgrim VP Financial Services
Portfolio, Pilgrim VP Growth & Income Portfolio, Pilgrim VP Growth + Value
Portfolio, Pilgrim VP Growth Opportunities Portfolio, Pilgrim VP High Yield Bond
Portfolio, Pilgrim VP International Portfolio, Pilgrim VP International SmallCap
Growth Portfolio, Pilgrim VP International Value Portfolio, Pilgrim VP LargeCap
Growth Portfolio, Pilgrim VP MagnaCap Portfolio, Pilgrim XX XxxXxx Opportunities
Portfolio, Pilgrim VP Research Enhanced Index Portfolio, Pilgrim VP SmallCap
Opportunities Portfolio and Pilgrim VP Worldwide Growth Portfolio; (9) PILGRIM
FUNDS TRUST, a Delaware business trust, consisting of Pilgrim European Equity
Fund, Pilgrim Global Communications Fund, Pilgrim Global Information Technology
Fund, Pilgrim Intermediate Bond Fund, Pilgrim Internet Fund, ING Pilgrim Money
Market Fund, Pilgrim National Tax-Exempt
Bond Fund and Pilgrim Tax Efficient Equity Fund; (10) PILGRIM MUTUAL FUNDS, a
Delaware business trust, consisting of Pilgrim Balanced Fund, Pilgrim
Convertible Fund, Pilgrim Emerging Countries Fund, Pilgrim High Yield Fund II,
Pilgrim International Core Growth Fund, Pilgrim International SmallCap Growth
Fund, Pilgrim LargeCap Growth Fund, Pilgrim MidCap Growth Fund, Pilgrim Money
Market Fund, Pilgrim SmallCap Growth Fund, Pilgrim Strategic Income Fund and
Pilgrim Worldwide Growth Fund; (11) PILGRIM SENIOR INCOME FUND, a Delaware
business trust; (12) PILGRIM ADVISORY FUNDS, INC., a Maryland corporation,
consisting of Pilgrim Asia-Pacific Equity Fund; (13) PILGRIM BANK AND THRIFT
FUND, INC., a Maryland corporation; (14) PILGRIM EMERGING MARKETS FUND, INC., a
Maryland corporation; (15) PILGRIM GNMA INCOME FUND, INC., a Maryland
corporation; (16) PILGRIM PRECIOUS METALS FUND, INC., a Maryland corporation;
(17) PILGRIM GROWTH AND INCOME FUND, INC., a Maryland corporation; (18) PILGRIM
INVESTMENT FUNDS, INC., a Maryland corporation, consisting of Pilgrim High Yield
Fund and Pilgrim MagnaCap Fund; (19) PILGRIM INTERNATIONAL FUND, INC., a
Maryland corporation, and (20) PILGRIM RUSSIA FUND, INC., a Maryland
corporation, and any other registered investment companies set forth on Exhibit
A, attached hereto, as amended from time to time (each such registered
investment company <1-20> and any investment company added to Exhibit A in the
future) hereinafter jointly and severally referred to as "Fund") each having its
principal place of business at 0000 X. Xxxxxxxxxx Xxxxx Xxxx, Xxxxxxxxxx,
Xxxxxxx, 00000-0000, and DST SYSTEMS, INC., a corporation organized and existing
under the laws of the State of Delaware, having its principal place of business
at 000 Xxxx 00xx Xxxxxx, 0xx Xxxxx, Xxxxxx Xxxx, Xxxxxxxx 00000 ("DST"):
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WITNESSETH:
WHEREAS, Fund desires to appoint DST as Transfer Agent and Dividend
Disbursing Agent, and DST desires to accept such appointment;
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
the parties hereto agree as follows:
1. Documents to be Filed with Appointment.
In connection with the appointment of DST as Transfer Agent and Dividend
Disbursing Agent for Fund, there will be filed with DST the following
documents:
A. A certified copy of the resolutions of the Board of Directors or
Trustees of Fund appointing DST as Transfer Agent and Dividend
Disbursing Agent, approving the form of this Agreement, and
designating certain persons to sign stock certificates, if any, and
give written instructions and requests on behalf of Fund;
B. A certified copy of the Articles of Incorporation or Declaration of
Trust of Fund and all amendments thereto;
C. A certified copy of the Bylaws of Fund;
D. Copies of Registration Statements and amendments thereto, filed with
the Securities and Exchange Commission;
E. Specimens of all forms of outstanding stock certificates, in the
forms approved by the Board of Directors or Trustees of Fund, with a
certificate of the Secretary of Fund, as to such approval;
F. Specimens of the signatures of the officers of Fund authorized to
sign stock certificates and individuals authorized to sign written
instructions and requests;
G. An opinion of counsel for Fund with respect to:
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(1) Fund's organization and existence under the laws of its state
of organization,
(2) The status of all shares of stock of Fund covered by the
appointment under the Securities Act of 1933, as amended, and
any other applicable federal or state statute, and
(3) That all issued shares are, and all unissued shares will be,
when issued, validly issued, fully paid and nonassessable.
2. Certain Representations and Warranties of DST.
DST represents and warrants to Fund that:
A. It is a corporation duly organized and existing and in good standing
under the laws of Delaware.
B. It is duly qualified to carry on its business in the State of
Missouri.
C. It is empowered under applicable laws and by its Articles of
Incorporation and bylaws to enter into and perform the services
contemplated in this Agreement.
D. It is registered as a transfer agent to the extent required under
the Securities Exchange Act of 1934.
E. All requisite corporate proceedings have been taken to authorize it
to enter into and perform this Agreement.
F. It has and will continue to have and maintain the necessary
facilities, equipment and personnel to perform its duties and
obligations under this Agreement.
3. Certain Representations and Warranties of Fund.
Fund represents and warrants to DST that:
A. It is duly organized as heretofore described and existing and in
good standing under the laws of the State/Commonwealth of
organization set forth after its name in the opening paragraph or,
if it does not appear in such opening paragraph, on Exhibit A.
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B. It is an open-end or closed-end management investment company
registered under the Investment Company Act of 1940, as amended.
C. A registration statement under the Securities Act of 1933 has been
filed and will be effective with respect to all shares of Fund being
offered for sale.
D. All requisite steps have been and will continue to be taken to
register Fund's shares for sale in all applicable states and such
registration will be effective at all times shares are offered for
sale in such state.
E. Fund is empowered under applicable laws and by its charter or
declaration and bylaws to enter into and perform this Agreement.
4. Scope of Appointment.
A. Subject to the conditions set forth in this Agreement, Fund hereby
appoints DST as Transfer Agent and Dividend Disbursing Agent.
B. DST hereby accepts such appointment and agrees that it will act as
Fund's Transfer Agent and Dividend Disbursing Agent. DST agrees that
it will also act as agent in connection with Fund's periodic
withdrawal payment accounts and other open accounts or similar plans
for shareholders, if any.
C. Fund agrees to use its best efforts to deliver to DST in Kansas
City, Missouri, as soon as they are available, all of its
shareholder account records.
D. DST, utilizing DST's computerized data processing systems for
securityholder accounting for open-end funds (the "TA2000(R)
System"), and subject to the provisions of Sections 19, 20 and 21 of
this Agreement, will perform the following services as transfer,
dividend disbursing and shareholders' servicing agent for Fund, and
as agent of Fund for shareholder accounts thereof, in a timely
manner: issuing
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(including countersigning), transferring and canceling share
certificates; maintaining all shareholder accounts; providing
transaction journals; preparing shareholder meeting lists (one
annually at no charge, lists for additional meetings will be charged
for), mailing proxies and proxy materials, receiving and tabulating
proxies, certifying the shareholder votes in Fund (all proxy
activities are subject to proxy fees and reimbursable fees); mailing
shareholder reports and prospectuses supplied to DST by Fund or its
agents; withholding, as required by Federal law and as directed by
Fund, taxes on nonresident alien and foreign corporation accounts,
for pension and deferred income, backup withholding or other
instances agreed upon by Fund and DST; disbursing income dividends
and capital gains distributions to shareholders, preparing, filing
and mailing U.S. Treasury Department Forms 1099, 1042, 1042S and
backup withholding as required for all shareholders and as directed
by Fund; preparing and mailing confirmation forms to shareholders
and dealers, as instructed, for all purchases and liquidations (not
applicable to closed-end funds except for transfers into or out of a
shareholders' account) of shares of Fund and other confirmable
transactions in shareholders' accounts; recording reinvestment of
dividends and distributions in shares of Fund; providing or making
available on-line daily and monthly reports as provided by the
TA2000 System and as requested by Fund or its management company;
maintaining those records necessary to carry out DST's duties
hereunder, including all information reasonably required by Fund to
account for all transactions (non-valued in closed-end funds) in
Fund shares, calculating the appropriate sales charge with respect
to each purchase of Fund shares as set forth in the prospectus for
Fund (not applicable to closed-end funds); solely for open-end
funds: determining the portion of each sales charge payable to the
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dealer participating in a sale in accordance with schedules
delivered to DST by Fund's principal underwriter or distributor
(hereinafter "principal underwriter") from time to time, disbursing
dealer commissions collected to such dealers, determining the
portion of each sales charge payable to such principal underwriter
and disbursing such commissions to the principal underwriter;
receiving correspondence pertaining to any former, existing or new
shareholder account, processing such correspondence for proper
recordkeeping, and responding promptly to shareholder
correspondence; mailing to dealers confirmations of wire order
trades (not applicable to closed-end funds); mailing copies of
shareholder statements to shareholders and registered
representatives of dealers in accordance with Fund's instructions;
and, solely in the case of open-end funds, processing, generally on
the date of receipt, purchases or redemptions or instructions to
settle any mail or wire order purchase or redemption (or in the case
of closed-end funds, effecting transfer of certificates) received in
proper order as set forth in the prospectus and DST's Procedures, as
hereinafter defined, rejecting promptly any requests not received in
proper order (as defined by Fund or its agents or DST's Procedures),
and, solely in the case of open-end funds, causing exchanges of
shares to be executed in accordance with Fund's instructions, the
applicable prospectus, DST's Procedures and the general exchange
privilege application.
E. At the request of an Authorized Person (a person identified as such
on Exhibit D, attached hereto and incorporated herein for
reference), DST shall use reasonable efforts to provide the services
set forth in this Agreement in connection with transactions (i) on
behalf of retirement plans and participants in retirement plans and
transactions ordered by brokers as part of a "no transaction fee"
program ("NTF"),
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the processing of which transactions require DST to use methods and
procedures other than those usually employed by DST to perform
shareholder servicing agent services, (ii) involving the provision
of information to DST after the commencement of the nightly
processing cycle of TA2000 System or (iii) which require more manual
intervention by DST, either in the entry of data or in the
modification or amendment of reports generated by the TA2000 System
than is usually required by non-retirement plan, non-NTF and
pre-nightly transactions (the "Exception Services").
F. Fund shall have the right to add new series to the TA2000 System
upon at least thirty (30) days' prior written notice to DST provided
that the requirements of the new series are generally consistent
with services then being provided by DST under this Agreement and
any new series shall be provided services in accordance with the Fee
Schedules then attached to the existing Agency Agreements between
DST and the various Funds of Pilgrim Capital Corporation, which
agreements pre-date this Agency Agreement. Rates or charges for
additional series shall be as set forth in Exhibit B, as hereinafter
defined, for the remainder of the contract term except as such
series use functions, features or characteristics for which DST has
imposed an additional charge as part of its standard pricing
schedule. In the latter event, rates and charges shall be in
accordance with DST's then-standard pricing schedule.
G. DST shall use reasonable efforts to provide, reasonably promptly
under the circumstances, the same services with respect to any new,
additional functions or features or any changes or improvements to
existing functions or features as provided for in Fund's
instructions, prospectus or application as amended from time to
time, for Fund provided (i) DST is advised in advance by Fund of any
changes
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therein, (ii) the TA2000 System and the mode of operations utilized
by DST as then constituted support such additional functions and
features, and (iii) any new or increased services to be provided by
DST or commenced to be used by Fund in addition to those currently
used at execution hereof or any new products or functionality added
to the TA2000 System shall be provided in accordance with the Fee
Schedules then attached to the existing Agency Agreements between
DST and the various Funds of Pilgrim Capital Corporation, which
agreements pre-date this Agency Agreement, or, if not referenced in
such fee schedules, at mutually agreed to fees and charges. If any
addition to, improvement of or change in the features and functions
currently provided by the TA2000 System or the operations as
requested by Fund requires an enhancement or modification to the
TA2000 System or to operations as presently conducted by DST, DST
shall not be liable therefor until such modification or enhancement
is, if DST agrees to develop or institute it, developed (at Fund's
expense) and installed on the TA2000 System or a new mode of
operation is instituted. If any new, additional function or feature
or change or improvement to existing functions or features or new
service or mode of operation measurably increases DST's cost of
performing the services required hereunder at the current level of
service, DST shall advise Fund of the amount of such increase and if
Fund elects to utilize such function, feature or service, DST shall
be entitled to increase its fees by the amount of the increase in
costs. In no event shall DST be responsible for or liable to provide
any additional function, feature, improvement or change in method of
operation until it has consented thereto in writing.
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5. Limit of Authority.
Unless otherwise expressly limited by the resolution of appointment or by
subsequent action by Fund, the appointment of DST as Transfer Agent will
be construed to cover the full amount of authorized stock of the class or
classes for which DST is appointed as the same will, from time to time, be
constituted, and any subsequent increases in such authorized amount.
In case of such increase Fund will file with DST:
A. If the appointment of DST was theretofore expressly limited, a
certified copy of a resolution of Fund's Board of Directors or
Trustees, as applicable, increasing the authority of DST;
B. A certified copy of the amendment to Fund's Articles of
Incorporation or Declaration of Trust, as applicable, authorizing
the increase of stock;
C. A certified copy of the order or consent of each governmental or
regulatory authority required by law to consent to the issuance of
the increased stock, and an opinion of counsel that the order or
consent of no other governmental or regulatory authority is
required;
D. Opinion of counsel for Fund stating:
(1) The status of the additional shares of stock of Fund under the
Securities Act of 1933, as amended, and any other applicable
federal or state statute and that said shares may be legally
issued; and
(2) That the additional shares are, or when issued will be,
validly issued, fully paid and nonassessable by Fund.
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6. Compensation and Expenses.
A. In consideration for its services hereunder as Transfer Agent and
Dividend Disbursing Agent, Fund will pay to DST from time to time a
reasonable compensation for all services rendered as Agent, and also
all its reasonable out-of-pocket expenses, charges, counsel fees,
and other disbursements (Compensation and Expenses) incurred in
connection with the agency. Such compensation is set forth in a
separate schedule to be agreed to, from time to time, by Fund and
DST, the current copy of which is attached hereto as Exhibit B and
incorporated herein by reference. If Fund has not paid such
Compensation and Expenses to DST within a reasonable time, DST may,
after written notice to Fund, charge against any monies held under
this Agreement, the amount of any Compensation and/or Expenses for
which it shall be entitled to reimbursement under this Agreement.
B. Fund also agrees promptly to reimburse DST for all reasonable
reimbursable expenses or disbursements incurred by DST in connection
with the performance of services under this Agreement including, but
not limited to, expenses for postage, express delivery services,
freight charges, envelopes, checks, drafts, forms (continuous or
otherwise), specially requested reports and statements, telephone
calls, telegrams, stationery supplies, counsel fees, outside
printing and mailing firms (including DST Output SRI, Inc.),
magnetic tapes, reels or cartridges (if sent to a Fund or to third
party at Fund's request) and magnetic tape handling charges,
off-site record storage, media for storage of records (e.g.,
microfilm, microfiche, optical platters, computer tapes), computer
equipment installed at Fund's request at Fund's or a third party's
premises, telecommunications equipment, telephone/ telecommunication
lines between Fund and its agents, on one hand, and DST on the
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other, proxy mailing, soliciting, processing and/or tabulating
costs, second-site backup computer facility, transmission of
statement data for remote printing or processing, and NSCC
transaction fees (as well as any other expenses set forth on Exhibit
C, as amended from time to time) to the extent any of the foregoing
are paid or incurred by DST. Fund agrees to pay postage expenses at
least one day in advance if so requested. In addition, any other
expenses incurred by DST at the request or with the consent of Fund
will be promptly reimbursed by Fund.
C. Amounts due hereunder shall be due and paid on or before the
thirtieth (30th) calendar day after receipt of the statement
therefor by Fund (the "Due Date"). Fund is aware that its failure to
pay all amounts in a timely fashion so that they will be received by
DST on or before the Due Date will give rise to costs to DST not
contemplated by this Agreement, including but not limited to
carrying, processing and accounting charges. Accordingly, subject to
Section 6.D. hereof, in the event that any amounts due hereunder are
not received by DST by the Due Date, Fund shall pay a late charge
equal to the rate set forth in the fee schedule times the amount
overdue, times the number of days from the Due Date up to and
including the day on which payment is received by DST divided by
365. The parties hereby agree that such late charge represents a
fair and reasonable computation of the costs incurred by reason of
late payment or payment of amounts not properly due. Acceptance of
such late charge shall in no event constitute a waiver of Fund's or
DST's default or prevent the non-defaulting party from exercising
any other rights and remedies available to it.
D. In the event that any charges are disputed, Fund shall, on or before
the Due Date, pay all undisputed amounts due hereunder and notify
DST in writing of any
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disputed charges for out-of-pocket expenses that it is disputing in
good faith. Payment for such disputed charges shall be due on or
before the close of the fifth (5th) business day after the day on
which DST provides to Fund documentation which an objective observer
would agree reasonably supports the disputed charges (the "Revised
Due Date"). Late charges shall not begin to accrue as to charges
disputed in good faith until the first day after the Revised Due
Date.
7. Operation of DST Systems.
In connection with the performance of its services under this Agreement,
DST is responsible for such items as:
A. That entries in DST's records and in Fund's records on the TA2000
System created by DST accurately reflect the orders, instructions,
and other information received by DST from Fund, Fund's principal
manager, underwriter or distributor or Fund's investment adviser,
sponsor, custodian or administrator (each an "Authorized Person"),
broker-dealers and shareholders;
B. That shareholder lists, shareholder account verifications,
confirmations and other shareholder account information to be
produced from its records or data be available and accurately
reflect the data in Fund's records on the TA2000 System;
C. The accurate and timely issuance of dividend and distribution checks
in accordance with instructions received from Fund and the data in
Fund's records on the TA2000 System;
D. That redemption transactions and payments with respect to shares of
open-end funds and transfers with respect to closed-end funds be
effected timely, under normal circumstances on the day of receipt,
and accurately in accordance with instructions received by DST from
dealers, shareholders, or an Authorized Person of Fund
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provided such instructions are in proper order as set forth
elsewhere in this Agreement and are consistent with the data in
Fund's records on the TA2000 System;
E. The deposit daily in Fund's appropriate special bank account of all
checks and payments received by DST from NSCC, broker-dealers or
shareholders for investment in shares of open-end funds;
F. Notwithstanding anything herein to the contrary, with respect to "as
of" adjustments, DST will not necessarily assume one hundred percent
(100%) responsibility for losses resulting from "as of's" due to
clerical errors or misinterpretations of shareholder instructions.
DST shall not be liable for any action taken, suffered, or omitted
by it or for any error of judgment made by it with respect to "as
of" adjustments in the absence of bad faith, willful misconduct,
knowing violations of applicable law pertaining to the manner in
which transfer agency services are to be performed by DST, reckless
disregard of the performance of its duties, or negligence on its
part. DST's liability hereunder shall extend only to losses that are
"material", that is, that, on a given, day arise from dilution or a
pricing error that is (i) greater than a negligible amount per
shareholder, (ii) equals or exceeds one ($.01) full cent per share
times the number of shares outstanding with respect to whether
recompense of Fund is required, or (iii) equals or exceeds the
product of one-half of one percent (1/2%) times Fund's Net Asset
Value per share times the number of shares outstanding with respect
to whether recompense at the shareholder level is required (or such
other amounts as may be adopted by applicable accounting or
regulatory authorities from time to time);
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G. Notwithstanding anything in this Agreement to the contrary, DST
shall perform the services set forth in Section 4.D. of, and
elsewhere in, this Agreement, including but not limited to the
requiring of proper forms of instructions, signatures and signature
guarantees and any necessary documents supporting the opening of
shareholder accounts (where required), transfers, redemptions and
other shareholder account transactions, in conformance with DST's
present procedures as set forth in its Legal Manual, Third Party
Check Procedures, Checkwriting Draft Procedures, and Signature
Guarantee Procedures with such changes or deviations therefrom as
may be from time to time required or approved by Fund, its
investment adviser or principal underwriter, or their or DST's
counsel (the "Procedures") and the rejection of orders or
instructions not in good order in accordance with the applicable
prospectus or the Procedures;
H. The maintenance of customary records in connection with its agency,
and particularly those records required to be maintained pursuant to
subparagraph (2) (iv) of paragraph (b) of Rule 31a-1 under the
Investment Company Act of 1940, if any; and
I. The maintenance of a current, duplicate set of Fund's essential
records as of the close of business on the prior business day at a
secure separate location, in a form available and usable forthwith
in the event of any breakdown or disaster disrupting its main
operation.
8. Indemnification.
A. DST shall at all times use reasonable care, due diligence and act in
good faith in performing its duties under this Agreement. DST shall
provide its services as transfer agent in accordance with Section
17A of the Exchange Act, and the rules
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and regulations thereunder. In the absence of bad faith, willful
misconduct, knowing violations of applicable law pertaining to the
manner in which transfer agency services are to be performed by DST
(excluding any violations arising directly or indirectly out of the
actions of DST-unaffiliated third parties), reckless disregard of
the performance of its duties, or negligence on its part, DST shall
not be liable for any action taken, suffered, or omitted by it or
for any error of judgment made by it in the performance of its
duties under this Agreement. For those activities or actions
delineated in the Procedures, DST shall be presumed to have used
reasonable care, due diligence and acted in good faith if it has
acted in accordance with the Procedures, copies of which have been
provided to Fund, as amended from time to time with approval of
counsel, or for any deviation therefrom approved by an Authorized
Person, Fund or Fund's or DST's counsel.
B. DST shall not be responsible for, and Fund shall indemnify and hold
DST harmless from and against, any and all losses, damages, costs,
charges, counsel fees, payments, expenses and liability which may be
asserted against DST or for which DST may be held to be liable,
arising out of or attributable to:
(1) All actions of DST required to be taken by DST pursuant to
this Agreement, provided that DST has acted in accordance with
the standards specified in Paragraph A;
(2) Fund's refusal or failure to comply with the terms of this
Agreement, Fund's negligence or willful misconduct, or the
breach of any representation or warranty of Fund hereunder;
(3) The good faith reliance on or the carrying out of any written
or recorded oral instructions or requests of persons
designated by Fund in writing from time
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to time as authorized to give instructions on its behalf or of
representatives of an Authorized Person or DST's good faith
reliance on or use of information, data, records and documents
received from, or which have been prepared and/or maintained
by or on behalf of, an Authorized Person;
(4) Defaults by dealers or shareowners with respect to payment for
share orders previously entered;
(5) The offer or sale of Fund's shares in violation of any
requirement under federal securities laws or regulations or
the securities laws or regulations of any state or in
violation of any stop order or other determination or ruling
by any federal agency or state with respect to the offer or
sale of such shares in such state (unless such violation
results from DST's failure to comply with written instructions
of Fund or of any officer of Fund that no offers or sales be
input into Fund's securityholder records in or to residents of
such state);
(6) Fund's or its agents' and Authorized Persons' omissions,
errors and mistakes: (a) in the use of (i) the TA2000 System,
(ii) the data center, computer and related equipment used to
access the TA2000 System (the "DST Facilities"), and (iii)
control procedures in the TA2000 System, and (b) in the
verification of output and (c) in the remote input of data;
(7) Errors, inaccuracies and omissions in, or errors, inaccuracies
or omissions of DST arising out of or resulting from such
errors, inaccuracies and omissions in, Fund's records,
shareholder records and other records, delivered to DST
hereunder by Fund or its prior agent(s) (but not including
errors, inaccuracies or omissions resulting from the
negligence or willful
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misconduct of DST while DST was acting as sub-agent on behalf
of Investors Fiduciary Trust Company, Fund's prior transfer
agent);
(8) Actions or omissions to act by Fund or agents designated by
Fund with respect to duties assumed thereby as provided for in
Section 21 hereof; and
(9) DST's performance of AGREED UPON Exception Services except
where DST acted or omitted to act in bad faith, with reckless
disregard of its obligations or with gross negligence.
C. Except where DST is entitled to indemnification under Section 8.B.
hereof, and subject to the provisions Section 7.F. hereof, DST shall
indemnify and hold Fund harmless from and against any and all
losses, damages, costs, charges, counsel fees, payments, expenses
and liability arising out of DST's failure to comply with the terms
of this Agreement or arising out of or attributable to DST's
negligence or willful misconduct or material breach of any
representation or warranty of DST hereunder.
D. EXCEPT FOR VIOLATIONS OF SECTION 23, IN NO EVENT AND UNDER NO
CIRCUMSTANCES SHALL EITHER PARTY TO THIS AGREEMENT BE LIABLE TO
ANYONE, INCLUDING, WITHOUT LIMITATION TO THE OTHER PARTY, FOR
CONSEQUENTIAL DAMAGES FOR ANY ACT OR FAILURE TO ACT UNDER ANY
PROVISION OF THIS AGREEMENT EVEN IF ADVISED OF THE POSSIBILITY
THEREOF.
E. Promptly after receipt by an indemnified person of notice of the
commencement of any action, such indemnified person will, if a claim
in respect thereto is to be made against an indemnifying party
hereunder, notify the indemnifying party in writing of
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the commencement thereof; but the failure so to notify the
indemnifying party will not relieve an indemnifying party from any
liability that it may have to any indemnified person for
contribution or otherwise under the indemnity agreement contained
herein except to the extent it is prejudiced as a proximate result
of such failure to timely notify. In case any such action is brought
against any indemnified person and such indemnified person seeks or
intends to seek indemnity from an indemnifying party, the
indemnifying party will be entitled to participate in, and, to the
extent that it may wish, assume the defense thereof (in its own name
or in the name and on behalf of any indemnified party or both with
counsel reasonably satisfactory to such indemnified person);
provided, however, if the defendants in any such action include both
the indemnified person and an indemnifying party and the indemnified
person shall have reasonably concluded that there may be a conflict
between the positions of the indemnified person and an indemnifying
party in conducting the defense of any such action or that there may
be legal defenses available to it and/or other indemnified persons
which are inconsistent with those available to an indemnifying
party, the indemnified person or indemnified persons shall have the
right to select one separate counsel (in addition to counsel
provided by the indemnifying party) to assume such legal defense and
to otherwise participate in the defense of such action on behalf of
such indemnified person or indemnified persons at such indemnified
party's sole expense. Upon receipt of notice from an indemnifying
party to such indemnified person of its election so to assume the
defense of such action and approval by the indemnified person of
counsel, which approval shall not be unreasonably withheld (and any
disapproval shall be accompanied by a written statement of the
reasons therefor), the indemnifying party
19
will not be liable to such indemnified person hereunder for any
legal or other expenses subsequently incurred by such indemnified
person in connection with the defense thereof. An indemnifying party
will not settle or compromise or consent to the entry of any
judgment with respect to any pending or threatened claim, action,
suit or proceeding in respect of which indemnification or
contribution may be sought hereunder (whether or not the indemnified
persons are actual or potential parties to such claim, action, suit
or proceeding) unless such settlement, compromise or consent
includes an unconditional release of each indemnified person from
all liability arising out of such claim, action, suit or proceeding.
An indemnified party will not, without the prior written consent of
the indemnifying party, settle or compromise or consent to the entry
of any judgment with respect to any pending or threatened claim,
action, suit or proceeding in respect of which indemnification or
contribution may be sought hereunder. If it does so, it waives its
right to indemnification therefor.
9. Certain Covenants of DST and Fund.
A. All requisite steps will be taken by Fund from time to time when and
as necessary to register Fund's shares for sale in all states in
which Fund's shares shall at the time be offered for sale and
require registration. If at any time Fund receives notice of any
stop order or other proceeding in any such state affecting such
registration or the sale of Fund's shares, or of any stop order or
other proceeding under the federal securities laws affecting the
sale of Fund's shares, Fund will give prompt notice thereof to DST.
B. DST hereby agrees to perform such transfer agency functions as are
set forth in section 4.D. above and establish and maintain
facilities and procedures reasonably
20
acceptable to 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, and to carry such insurance as it
considers adequate and reasonably available.
C. To the extent required by Section 31 of the Investment Company Act
of 1940 as amended and Rules thereunder, DST agrees that all
shareholder- or Fund-related records maintained by DST relating to
the services performed by DST under this Agreement are the property
of Fund and will be preserved, and will, upon receipt of payment of
all sums due to DST in connection with DST's performance under this
Agreement, be surrendered promptly to Fund on request.
D. DST agrees to furnish Fund semiannual reports of its financial
condition, consisting of a balance sheet, earnings statement and any
other readily and publicly available financial information
reasonably requested by Fund. The annual financial statements will
be certified by DST's certified public accountants. DST agrees to
provide such reports as are produced by the TA2000 System respecting
its services under this Agreement to Fund's Board as the Fund Board
may reasonably request.
E. DST represents and agrees that it will use its reasonable efforts to
keep current on the trends of the investment company industry
relating to shareholder services and will use its reasonable efforts
to continue to modernize and improve.
F. DST will permit Fund and its authorized representatives to make
periodic inspections of its operations as such would involve Fund
upon reasonable prior notice and at reasonable times during business
hours.
G. DST agrees to use its reasonable efforts to provide in Kansas City
at Fund's expense two (2) man weeks of training for Fund's personnel
in connection with use and
21
operation of the TA2000 System. All travel and reimbursable expenses
incurred by Fund's personnel in connection with and during training
at DST's Facility shall be borne by Fund. At Fund's option and
expense, DST also agrees to use its best efforts to provide an
additional two (2) man weeks of training at Fund's facility for
Fund's personnel in connection with the TA2000 System. Reasonable
travel, per diem and reimbursable expenses incurred by DST personnel
in connection with and during training at Fund's facility or in
connection with the conversion shall be borne by Fund.
10. Recapitalization or Readjustment.
In case of any recapitalization, readjustment or other change in the
capital structure of Fund requiring a change in the form of stock
certificates, DST will, upon agreement with Fund as to the charges to
apply thereto, issue or register certificates in the new form in exchange
for, or in transfer of, the outstanding certificates in the old form, upon
receiving:
A. Written instructions from an officer of Fund;
B. Certified copy of the amendment to the Articles of Incorporation or
other document effecting the change;
C. Certified copy of the order or consent of each governmental or
regulatory authority required by law to the issuance of the stock in
the new form, and an opinion of counsel that the order or consent of
no other government or regulatory authority is required;
D. Specimens of the new certificates in the form approved by the Board
of Directors or Trustees of Fund, with a certificate of the
Secretary of Fund as to such approval;
E. Opinion of counsel for Fund stating:
22
(1) The status of the shares of stock of Fund in the new form
under the Securities Act of 1933, as amended and any other
applicable federal or state statute; and
(2) That the issued shares in the new form are, and all unissued
shares will be, when issued, validly issued, fully paid and
nonassessable by the Fund.
11. Stock Certificates.
Fund will furnish DST with a sufficient supply of blank stock certificates
and from time to time will renew such supply upon the request of DST. Such
certificates will be signed manually or by facsimile signatures of the
officers of Fund authorized by law and by bylaws to sign stock
certificates and, if required, will bear the corporate seal or facsimile
thereof.
12. Death, Resignation or Removal of Signing Officer.
Fund will file promptly with DST written notice of any change in the
officers authorized to sign stock certificates, written instructions or
requests, together with two certificates of the Secretary or Clerk bearing
the specimen signature of each newly authorized officer. In case any
officer of Fund who has signed manually or whose facsimile signature has
been affixed to blank stock certificates dies, resigns, or is removed
prior to the issuance of such certificates, DST may issue or register such
stock certificates as the stock certificates of Fund notwithstanding such
death, resignation, or removal, until specifically directed to the
contrary by Fund in writing. In the absence of such direction, Fund will
file promptly with DST such approval, adoption, or ratification as may be
required by law.
13. Future Amendments of Charter and Bylaws.
Fund will promptly file with DST copies of all material amendments to its
Articles of Incorporation or Declaration of Trust, as applicable, or
bylaws made after the date of this Agreement.
23
14. Instructions, Opinion of Counsel and Signatures.
At any time DST may apply to any person authorized by Fund, including
without limitation the duly authorized representative of any Authorized
Person and any Authorized Personnel set forth on Exhibit D to this
Agreement, to give instructions to DST, and may with the approval of a
Fund officer consult with legal counsel for Fund or its own legal counsel
at the expense of Fund, with respect to any matter arising in connection
with the agency and it will not be liable for any action taken or omitted
by it in good faith in reliance upon such instructions or upon the opinion
of such counsel. DST will be protected in acting upon any paper or
document reasonably believed by it to be genuine and to have been signed
by the proper person or persons and will not be held to have notice of any
change of authority of any person, until receipt of written notice thereof
from Fund. It will also be protected in recognizing stock certificates
which it reasonably believes to bear the proper manual or facsimile
signatures of the officers of Fund, and the proper countersignature of any
former Transfer Agent or Registrar, or of a present or former co-Transfer
Agent or co-Registrar.
15. Force Majeure and Disaster Recovery Plans.
A. DST SHALL NOT BE RESPONSIBLE OR LIABLE FOR ITS FAILURE OR DELAY IN
PERFORMANCE OF ITS OBLIGATIONS UNDER THIS AGREEMENT ARISING OUT OF
OR CAUSED, DIRECTLY OR INDIRECTLY, BY CIRCUMSTANCES BEYOND ITS
REASONABLE CONTROL, INCLUDING, WITHOUT LIMITATION: ANY INTERRUPTION,
LOSS OR MALFUNCTION OR ANY UTILITY, TRANSPORTATION, COMPUTER
(HARDWARE OR SOFTWARE) OR COMMUNICATION SERVICE; INABILITY TO OBTAIN
LABOR, MATERIAL, EQUIPMENT OR TRANSPORTATION, OR A DELAY IN
24
MAILS; GOVERNMENTAL OR EXCHANGE ACTION, STATUTE, ORDINANCE, RULINGS,
REGULATIONS OR DIRECTION; WAR, STRIKE, RIOT, EMERGENCY, CIVIL
DISTURBANCE, TERRORISM, VANDALISM, EXPLOSIONS, LABOR DISPUTES,
FREEZES, FLOODS, FIRES, TORNADOS, ACTS OF GOD OR PUBLIC ENEMY,
REVOLUTIONS, OR INSURRECTION; OR ANY OTHER CAUSE, CONTINGENCY,
CIRCUMSTANCE OR DELAY NOT SUBJECT TO DST'S CONTROL WHICH PREVENTS OR
HINDERS DST'S PERFORMANCE HEREUNDER.
B. DST currently maintains an agreement with a third party whereby DST
is to be permitted to use on a "shared use" basis a "hot site" (the
"Recovery Facility") maintained by such party in event of a disaster
rendering the DST Facilities inoperable. DST has developed and is
continually revising a business contingency plan (the "Business
Contingency Plan") detailing which, how, when, and by whom data
maintained by DST at the DST Facilities will be installed and
operated at the Recovery Facility. Provided Fund is paying its pro
rata portion of the charge therefor, DST would, in event of a
disaster rendering the DST Facilities inoperable, use reasonable
efforts to convert the TA2000 System containing the designated Fund
data to the computers at the Recovery Facility in accordance with
the then current Business Contingency Plan.
C. DST also currently maintains, separate from the area in which the
operations that provide the services to Fund hereunder are located,
a Crisis Management Center consisting of phones, computers and the
other equipment necessary to operate a full service transfer agency
business in the event one of its operations areas is rendered
25
inoperable. The transfer of operations to other operating areas or
to the Crisis Management Center is also covered in DST's Business
Contingency Plan.
16. Certification of Documents.
The required copy of the Articles of Incorporation or Declaration of Trust
of Fund and copies of all amendments thereto will be certified by the
Secretary of State (or other appropriate official) of the State of
Incorporation, and if such Articles of Incorporation or Declaration of
Trust and amendments are required by law to be also filed with a county,
city or other officer of an official body, a certificate of such filing
will appear on the certified copy submitted to DST. A copy of the order or
consent of each governmental or regulatory authority required by law to
the issuance of the stock will be certified by the Secretary or Clerk of
such governmental or regulatory authority, under proper seal of such
authority. The copy of the Bylaws and copies of all amendments thereto,
and copies of resolutions of the Board of Directors or Trustees of Fund,
as applicable, will be certified by the Secretary or Clerk or an Assistant
Secretary or Clerk of Fund under Fund's seal.
17. Records.
DST will maintain customary records in connection with its agency, and
particularly will maintain those records required to be maintained
pursuant to subparagraph (2) (iv) of paragraph (b) of Rule 31a-1 under the
Investment Company Act of 1940, if any.
18. Disposition of Books, Records and Canceled Certificates.
DST may send periodically to Fund, or to where designated by the Secretary
or an Assistant Secretary of Fund, all books, documents, and records no
longer deemed needed for current purposes and all stock certificates which
have been canceled in transfer or in exchange, upon the understanding that
such books, documents, records, and stock certificates will be maintained
by Fund under and in accordance with the requirements of Section 17Ad-7
26
adopted under the Securities Exchange Act of 1934. Such materials will not
be destroyed by Fund without the consent of DST (which consent will not be
unreasonably withheld), but will be safely stored for possible future
reference and maintained, preserved and made available to DST and the U.S.
Securities and Exchange Commission in accordance with the requirement of
Sections 17Ad-7 under the Securities Exchange Act of 1934 (17 C.F.R.
Section 240.17Ad-7).
19. Provisions Relating to DST as Transfer Agent.
A. DST will make original issues of stock certificates upon written
request of an officer of Fund, and upon mutual agreement as to the
charges to apply thereto and being furnished with a certified copy
of a resolution of the Board of Directors or Trustees authorizing
such original issue, an opinion of counsel as outlined in Section
1.G. of this Agreement, any documents required by Sections 5. or 10.
of this Agreement, and necessary funds for the payment of any
original issue tax.
B. Before making any original issue of certificates, Fund will furnish
DST with sufficient funds to pay all required taxes on the original
issue of the stock, if any. Fund will furnish DST such evidence as
may be required by DST to show the actual value of the stock. If no
taxes are payable, DST will be furnished with an opinion of outside
counsel to that effect.
C. Shares of stock will be transferred and new certificates issued in
transfer, or, except in the case of closed-end funds, shares of
stock will be accepted for redemption and funds remitted therefor,
or book entry transfer will be effected, upon surrender of the old
certificates in form or receipt by DST of instructions deemed by DST
properly endorsed for transfer or, except in the case of closed-end
funds, redemption accompanied by such documents as DST may deem
necessary to evidence the
27
authority of the person making the transfer or redemption. DST
reserves the right to refuse to transfer or redeem shares until it
is satisfied that the endorsement or signature on the certificate or
any other document is valid and genuine, and for that purpose,
unless Fund has instructed DST not to require a signature guarantee,
DST may require a guaranty of signature in accordance with the
Procedures. DST shall have the right to refuse to transfer or redeem
shares until it is satisfied that the requested transfer or
redemption is legally authorized, and it will incur no liability for
the refusal in good faith to make transfers or redemptions that, in
its judgment, are improper or unauthorized. DST may, in effecting
transfers or redemptions, rely upon Simplification Acts, Uniform
Commercial Code, or other statutes that protect it and Fund in not
requiring complete fiduciary documentation. In cases in which DST is
not directed or otherwise required to maintain the consolidated
records of shareholder's accounts, DST will not be liable for any
loss that may arise by reason of not having such records.
D. When mail is used for delivery of stock certificates, DST will
forward stock certificates in "nonnegotiable" form by first class or
registered mail and stock certificates in "negotiable" form by
registered mail, all such mail deliveries to be covered while in
transit to the addressee by insurance arranged for by DST.
E. DST will issue and mail subscription warrants, certificates
representing stock dividends, exchanges or split ups, or act as
Conversion Agent upon receiving written instructions from any
officer of Fund and such other documents as DST deems necessary upon
agreement between DST and Fund as to the charges to apply thereto.
28
F. DST will issue, transfer, and split up certificates and will issue
certificates of stock representing full shares upon surrender of
scrip certificates aggregating one full share or more when presented
to DST for that purpose upon receiving written instructions from an
officer of Fund and such other documents as DST may deem necessary.
G. DST may issue new certificates in place of certificates represented
to have been lost, destroyed, stolen or otherwise wrongfully taken
upon receiving instructions from Fund and indemnity satisfactory to
DST and Fund, and may issue new certificates in exchange for, and
upon surrender of, mutilated certificates. Such instructions from
Fund will be in such form as will be approved by the Board of
Directors or Trustees of Fund and will be in accordance with the
provisions of law and the bylaws of Fund governing such matter.
H. DST will supply a shareholder's list to Fund for its annual meeting
upon receiving a request from an officer of Fund. It will also
supply lists at such other times as may be requested by an officer
of Fund, subject to payment of applicable charges therefor.
I. Upon receipt of written instructions of an officer of Fund, DST will
address and mail notices to shareholders.
J. In case of any request or demand for the inspection of the stock
books of Fund or any other books or records in the possession of
DST, DST will endeavor to notify Fund and to secure instructions as
to permitting or refusing such inspection. DST reserves the right,
however, to exhibit the stock books or other books or records to any
person in case it is advised by its counsel that it may be held
responsible for the failure to exhibit the stock books or other
books to such person.
29
20. Provisions Relating to Dividend Disbursing Agency.
A. DST will, at the expense of Fund, provide a special form of check
containing the imprint of any device or other matter desired by
Fund. Said checks must, however, be of a form and size convenient
for use by DST.
B. If Fund desires to include additional printed matter, financial
statements, etc., with the dividend checks, the same will be
furnished to DST within a reasonable time prior to the date of
mailing of the dividend checks, at the expense of Fund.
C. If Fund desires its distributions mailed in any special form of
envelopes, sufficient supply of the same will be furnished to DST,
but the size and form of said envelopes will be subject to the
approval of DST. If stamped envelopes are used, they must be
furnished by Fund; or if postage stamps are to be affixed to the
envelopes, the stamps or the cash necessary for such stamps must be
furnished by Fund in advance of such mailing.
D. DST is hereby authorized to open and to maintain at a Bank
acceptable to Fund one or more non-interest bearing deposit accounts
as Agent for Fund, into which the funds for payment of dividends,
distributions, redemptions or other disbursements provided for
hereunder will be deposited, and against which checks will be drawn.
E. DST is authorized and directed to stop payment of checks theretofore
issued hereunder, but not presented for payment, when the payees
thereof allege either that they have not received the checks or that
such checks have been mislaid, lost, stolen, destroyed or through no
fault of theirs, are otherwise beyond their control, and cannot be
produced by them for presentation and collection, and, to issue and
deliver duplicate checks in replacement thereof.
30
21. Assumption of Duties By Fund or Agents Designated By Fund.
A. Fund or its designated agents other than DST may assume certain
duties and responsibilities of DST or those services of Transfer
Agent and Dividend Disbursement Agent as those terms are referred to
in Section 4.D. of this Agreement including but not limited to
answering and responding to telephone inquiries from shareholders
and brokers, accepting shareholder and broker instructions (either
or both oral and written) and transmitting orders based on such
instructions to DST, preparing and mailing confirmations, obtaining
certified TIN numbers, classifying the status of shareholders and
shareholder accounts under applicable tax law, establishing
shareholder accounts on the TA2000 System and assigning social codes
and Taxpayer Identification Number codes thereof, and disbursing
monies of Fund, said assumption to be embodied in writing to be
signed by both parties.
B. To the extent Fund or its agent or affiliate assumes such duties and
responsibilities, DST shall be relieved from all responsibility and
liability therefor and is hereby indemnified and held harmless
against any liability therefrom and in the same manner and degree as
provided for in Section 8 hereof.
C. DST MAY, SUBJECT TO THE WRITTEN CONSENT OF THE FUND, APPOINT OTHER
PARTIES QUALIFIED TO PERFORM TRANSFER AGENCY SERVICES ("SUB-TRANSFER
AGENTS") TO CARRY OUT SOME OR ALL OF ITS RESPONSIBILITIES UNDER THIS
AGREEMENT; PROVIDED, HOWEVER, THAT A SUB-TRANSFER AGENT SHALL BE THE
AGENT OF DST AND NOT THE AGENT OF THE FUND, AND THAT UNLESS THE
SUB-TRANSFER AGENT IS APPOINTED AT THE DIRECTION OF THE FUND, DST
SHALL BE FULLY RESPONSIBLE FOR THE ACTS OF A SUB-TRANSFER AGENT AND
SHALL NOT BE RELIEVED OF ANY OF ITS RESPONSIBILITIES HEREUNDER BY
THE APPOINTMENT OF A SUB-TRANSFER AGENT.
31
D. Initially Fund shall be responsible for the following: (i) answering
and responding to phone calls from shareholders and broker-dealers,
and (ii) scanning items into the AWD(TM) System as such calls or
items are received by Fund, and (iii) entering and confirming wire
order trades.
22. Termination of Agreement.
A. This Agreement shall be in effect from the date set forth on the
first page (the "Effective Date") through May 31, 2002 and
thereafter shall remain in effect unless terminated by either party
upon receipt of six (6) months written notice from the other party,
provided, however, that the effective date of any termination shall
not occur during the period from December 15 through March 30 of any
year to avoid adversely impacting year end.
B. Each party, in addition to any other rights and remedies, shall have
the right to terminate this Agreement forthwith upon the occurrence
at any time of any of the following events with respect to the other
party:
(1) Any interruption or cessation of operations by the other party
or its assigns that materially interferes with the business
operation of the first party;
(2) The bankruptcy of the other party or its assigns or the
appointment of a receiver for the other party or its assigns;
(3) Failure by the other party or its assigns to perform its
duties in accordance with the Agreement, which failure
materially adversely affects the business operations of the
first party and which failure continues for thirty (30) days
after receipt of written notice from the first party; and
32
(4) The acquisition of a controlling interest in DST Systems, Inc.
or its assigns, by any broker, dealer, investment adviser or
investment company except as may presently exist.
C. In the event of any termination, Fund will promptly pay DST all
amounts due to DST hereunder. In addition, if this Agreement is
terminated by Fund for any reason other than those set forth in
Section 22.B. hereof, then Fund shall pay to DST on the last
business day of each of the next three (3) whole or partial calendar
months (commencing with the last day of the month in which
termination actually occurs if termination does not occur on the
last business day of the month, and with the last business day of
the immediately following month if termination actually occurs on
the last business day of a month) an amount equal to the average
monthly fees, exclusive of the out-of-pocket expenses, paid by or on
behalf of each terminating party under the affected Agreement during
the six (6) calendar months preceding the month during which the
termination notice was received by DST.
D. If the termination date set forth in the original termination notice
is extended by any terminating party (which extension shall require
the agreement of DST), then the fees and charges payable by the
terminating party under this Agreement shall increase by twenty
percent (20%) during the period commencing with the original
termination date set forth in the initial termination notice and
concluding with the day upon which termination actually occurs.
These provisions are in addition to any other contractual provision
or compensation agreements that may be in existence at the time of
an actual transfer.
E. DST shall, upon termination of this Agreement and receipt of payment
of all outstanding bills and invoices, deliver to the successor so
specified or appointed, or
33
to Fund, at DST's office, all records then held by DST hereunder,
all funds and other properties of Fund deposited with or held by DST
hereunder. In the event no written order designating a successor
(which may be Fund) shall have been delivered to DST on or before
the date when such termination shall become effective, then DST
shall deliver the records, funds and properties of Fund to a bank or
trust company at the selection of DST or if a satisfactory successor
cannot be obtained, DST may deliver the assets to Fund, at DST's
offices or as otherwise agreed to between the parties in any event
upon written notice to Fund. Thereafter Fund or such bank or trust
company shall be the successor under this Agreement and shall be
entitled to reasonable compensation for its services.
Notwithstanding the foregoing requirement as to delivery upon
termination of this Agreement, DST may make any other delivery of
the funds and property of Fund that shall be permitted by the
Investment Company Act of 1940 and Fund's Articles of Incorporation,
Declaration of Trust, and/or Bylaws then in effect. Except as
otherwise provided herein, neither this Agreement nor any portion
thereof may be assigned by DST without the consent of Fund.
F. In the event of termination, DST shall provide reasonable assistance
to Fund and its designated successor transfer agent and other
information relating to its services provided hereunder (subject to
the recompense of DST for such assistance at its standard rates and
fees for personnel then in effect at that time); provided, however,
as used herein "reasonable assistance" and "other information" shall
not include assisting any new service or system provider to modify,
alter, enhance, or improve such new service or system provider's
system or to improve, enhance, or alter its current, or to provide
any new, functionality or to require DST to disclose any DST
34
Protected Information, as defined in Section 23 of this Agreement,
or any information which is otherwise confidential to DST. DST's
assistance shall be billed at its then current rates. DST's present
rates, which are subject to annual increase as DST's labor costs for
such personnel increase, are as is set forth in Exhibit B to this
Agreement.
G. Nothing in this Agreement is intended to, nor does it, compel DST to
disclose non-public information concerning its operations or
operating systems, including but not limited to the TA2000 System,
or to provide programming assistance or information which might tend
to improve, enhance, or add functionality to anyone else's operating
systems.
23. Confidentiality.
A. DST agrees that, except as provided in the last sentence of Section
19.J hereof, or as otherwise required by law, DST will keep
confidential all records of and information relating to Fund or its
shareholders or shareholder accounts in its possession and will not
disclose the same to any person except at the request or with the
consent of Fund.
B. Fund agrees to keep confidential all provisions, terms and
conditions of this Agreement, all financial statements and other
financial records (other than statements and records relating solely
to Fund's business dealings with DST) and all manuals, systems and
other technical information and data, not publicly disclosed,
relating to DST's operations and programs furnished to it by DST
pursuant to this Agreement and will not disclose the same to any
person except at the request or with the consent of DST.
35
C. Fund acknowledges that DST has proprietary rights in and to the
computerized data processing recordkeeping system used by DST to
perform services hereunder including but not limited to the
maintenance of shareholder accounts and records, processing of
related information and generation of output, the TA2000 System,
including without limitation any changes or modifications of the
TA2000 System and any other DST programs, data bases, supporting
documentation, or procedures (collectively "DST Protected
Information") which Fund's access to the TA2000 System or software
or DST Facilities may permit Fund or its employees or agents to
become aware of or to access and that the DST Protected Information
constitutes confidential material and trade secrets of DST. Fund
agrees to maintain the confidentiality of the DST Protected
Information.
D. Fund acknowledges that any unauthorized use, misuse, disclosure or
taking of DST Protected Information which is confidential as
provided by law, or which is a trade secret, residing or existing
internal or external to a computer, computer system, or computer
network, or the knowing and unauthorized accessing or causing to be
accessed of any computer, computer system, or computer network, may
be subject to civil liabilities and criminal penalties under
applicable state law. Fund will advise all of its employees and
agents who have access to any DST Protected Information or to any
computer equipment capable of accessing DST hardware or software of
the foregoing.
E. Fund acknowledges that disclosure of the DST Confidential
Information may give rise to an irreparable injury to DST
inadequately compensable in damages. Accordingly, DST may seek
(without the posting of any bond or other security) injunctive
relief against the breach of the foregoing undertaking of
confidentiality
36
and nondisclosure, in addition to any other legal remedies that may
be available, and Fund consents to the obtaining of such injunctive
relief. All of the undertakings and obligations relating to
confidentiality and nondisclosure, whether contained in this Section
or elsewhere in this Agreement shall survive the termination or
expiration of this Agreement for a period of ten (10) years.
24. Changes and Modifications.
A. During the term of this Agreement DST will use on behalf of Fund
without additional cost all modifications, enhancements, or changes
which DST may make to the TA2000 System in the normal course of its
business and which are applicable to functions and features offered
by Fund, unless substantially all DST clients are charged separately
for such modifications, enhancements or changes, including, without
limitation, substantial system revisions or modifications
necessitated by changes in existing laws, rules or regulations. Fund
agrees to pay DST promptly for modifications and improvements that
are charged for separately at the rate provided for in DST's
standard pricing schedule that shall be identical for substantially
all clients, if a standard pricing schedule shall exist. If there is
no standard pricing schedule, the parties shall mutually agree upon
the rates to be charged.
B. DST shall have the right, at any time and from time to time, to
alter and modify any systems, programs, procedures or facilities
used or employed in performing its duties and obligations hereunder;
provided that Fund will be notified as promptly as possible prior to
implementation of such alterations and modifications and that no
such alteration or modification or deletion shall materially
adversely change or affect the operations and procedures of Fund in
using or employing the TA2000 System or DST Facilities hereunder or
the reports to be generated by such system
37
and facilities hereunder, unless Fund is given thirty (30) days
prior notice to allow Fund to change its procedures and DST provides
Fund with revised operating procedures and controls.
C. All enhancements, improvements, changes, modifications or new
features added to the TA2000 System however developed or paid for
shall be, and shall remain, the confidential and exclusive property
of, and proprietary to, DST.
25. Subcontractors.
Nothing herein shall impose any duty upon DST in connection with or make
DST liable for the actions or omissions to act of unaffiliated third
parties such as, by way of example and not limitation, the banks at which
the deposit accounts are maintained, The National Securities Clearing
Corporation, airborne services, the U.S. mails and telecommunication
companies, provided, if DST selected such company, DST shall have
exercised due care in selecting the same.
26. Limitations on Liability.
A. If Fund is comprised of more than one Portfolio, each Portfolio
shall be regarded for all purposes hereunder as a separate party
apart from each other Portfolio. Unless the context otherwise
requires, with respect to every transaction covered by this
Agreement, every reference herein to Fund shall be deemed to relate
solely to the particular Portfolio to which such transaction
relates. Under no circumstances shall the rights, obligations or
remedies with respect to a particular Portfolio constitute a right,
obligation or remedy applicable to any other Portfolio or the
rights, obligations or remedies with respect to a particular Fund
constitute a right, obligation or remedy applicable to any other
Fund. The use of this single document to memorialize the separate
agreement of each Portfolio or Fund is understood to be for clerical
38
convenience only and shall not constitute any basis for joining the
Portfolios or Funds for any reason.
B. Notice is hereby given that a copy of Fund's Articles of
Incorporation or Trust Agreement (as applicable) and all amendments
thereto is on file with the Secretary of State of the state of its
organization; that this Agreement has been executed on behalf of
Fund by the undersigned duly authorized representative of Fund in
his/her capacity as such and not individually; and that the
obligations of this Agreement shall only be binding upon the assets
and property of Fund and shall not be binding upon any director,
trustee, officer or shareholder of Fund individually.
27. Notices.
All notices, consents, requests, instructions, approvals and other
communications provided for herein shall be validly given, made or served
if in writing and delivered personally, sent by mail, registered or
certified, return receipt requested, postage prepaid, by telegram or by
facsimile transmission:
If to Fund:
The ING Pilgrim Family of Funds
0000 X. Xxxxxxxxxx Xxxxx Xxxx
Xxxxxxxxxx, Xxxxxxx 00000-0000
Telephone No.: (000) 000-0000
Telecopier No.: (000) 000-0000
Attn: Rob Naka, Senior Vice President
And if to DST:
DST Systems, Inc.
000 Xxxx 00xx Xxxxxx, 0xx Xxxxx
Xxxxxx Xxxx, Xxxxxxxx 00000
Telephone No.: (000) 000-0000
Telecopier No.: (000) 000-0000
Attn: Xxxxxxxx Xxxxx, Group Vice President
39
With a copy of non-operational notices to:
DST Systems, Inc.
000 Xxxx 00xx Xxxxxx, 0xx Xxxxx
Xxxxxx Xxxx, Xxxxxxxx 00000
Telephone No.: (000) 000-0000
Telecopier No.: (000) 000-0000
Attn: Legal Department
or to such other address as DST or Fund may from time to time designate in
writing delivered as provided above.
28. Miscellaneous.
A. This Agreement is executed and delivered in the State of Missouri
and shall be construed according to, and the rights and liabilities
of the parties hereto shall be governed by, the laws of the State of
Missouri, excluding that body of law applicable to choice of law.
B. All terms and provisions of this Agreement shall be binding upon,
inure to the benefit of and be enforceable by the parties hereto and
their respective successors and permitted assigns.
C. The representations and warranties, all indemnifications and any
limitations on liability set forth in this Agreement are intended to
and shall continue after and survive the expiration, termination or
cancellation of this Agreement until any statute of limitations
applicable to the matter at issues shall have expired.
D. No provisions of this Agreement may be amended or modified in any
manner except by a written agreement properly authorized and
executed each party hereto.
E. The captions in this Agreement are included for convenience of
reference only, and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect.
40
F. This Agreement may be executed in two or more counterparts,
each of which shall be deemed an original but all of which
together shall constitute one and the same instrument.
G. If any part, term or provision of this Agreement is by the
courts held to be illegal, in conflict with any law or
otherwise invalid, the remaining portion or portions shall be
considered severable and not be affected, and the rights and
obligations of the parties shall be construed and enforced as
if this Agreement did not contain the particular part, term or
provision held to be illegal or invalid.
H. This Agreement may not be assigned any party hereto without
prior written consent of the other parties.
I. Neither the execution nor performance of this Agreement shall
be deemed to create a partnership or joint venture by and
between Fund and DST. It is understood and agreed that all
services performed hereunder by DST shall be as an independent
contractor and not as an employee of Fund. This Agreement is
between DST and Fund and neither this Agreement nor the
performance of services under it shall create any rights in
any third parties. There are no third party beneficiaries
hereto.
J. Except as specifically provided herein, this Agreement does
not in any way affect any other agreements entered into among
the parties hereto and any actions taken or omitted by any
party hereunder shall not affect any rights or obligations of
any other party hereunder.
K. The failure of either party to insist upon the performance of
any terms or conditions of this Agreement or to enforce any
rights resulting from any breach of any of the terms or
conditions of this Agreement, including the payment of
damages, shall not be construed as a continuing or permanent
waiver of any such terms, conditions,
41
rights or privileges, but the same shall continue and remain
in full force and effect as if no such forbearance or waiver
had occurred.
L. This Agreement constitutes the entire agreement between the
parties hereto and supersedes any prior agreement, draft or
agreement or proposal with respect to the appointment of DST
as Agent for the Fund and the provision by DST of transfer
agency services as such Agent between any Fund and DST,
whether oral or written.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their respective duly authorized officers, to be effective as of the
day and year first above written.
DST SYSTEMS, INC.
By: /s/ Xxxxxxxx Xxxxx
------------------------------------------
Title: Group VP
---------------------------------------
Date: 11/30/2000
----------------------------------------
LEXINGTON MONEY MARKET TRUST
PILGRIM EQUITY TRUST
Pilgrim Index Plus Protection Fund
Pilgrim MidCap Opportunities Fund
PILGRIM GROWTH OPPORTUNITIES FUND
PILGRIM MAYFLOWER TRUST
Pilgrim Growth + Value Fund
Pilgrim International Value Fund
Pilgrim Research Enhanced Index Fund
42
PILGRIM NATURAL RESOURCES TRUST
PILGRIM PRIME RATE TRUST
PILGRIM SMALLCAP OPPORTUNITIES FUND
PILGRIM VARIABLE PRODUCTS TRUST
Pilgrim VP Convertible Portfolio
Pilgrim VP Emerging Countries Portfolio
Pilgrim VP Financial Services Portfolio
Pilgrim VP Growth & Income Portfolio
Pilgrim VP Growth + Value Portfolio
Pilgrim VP Growth Opportunities Portfolio
Pilgrim VP High Yield Bond Portfolio
Pilgrim VP International Portfolio
Pilgrim VP International
SmallCap Growth Portfolio
Pilgrim VP International Value Portfolio
Pilgrim VP LargeCap Growth Portfolio
Pilgrim VP MagnaCap Portfolio
Pilgrim XX XxxXxx Opportunities Portfolio
Pilgrim VP Research Enhanced Index
Portfolio
Pilgrim VP SmallCap Opportunities
Portfolio
Pilgrim VP Worldwide Growth Portfolio
PILGRIM FUNDS TRUST
Pilgrim European Equity Fund
Pilgrim Global Communications Fund
Pilgrim Global Information Technology
Fund
Pilgrim Intermediate Bond Fund
Pilgrim Internet Fund
ING Pilgrim Money Market Fund
Pilgrim National Tax-Exempt Bond Fund
Pilgrim Tax Efficient Equity Fund
PILGRIM MUTUAL FUNDS
Pilgrim Balanced Fund
Pilgrim Convertible Fund
Pilgrim Emerging Countries Fund
Pilgrim High Yield Fund II
Pilgrim International Core Growth Fund
Pilgrim International SmallCap
Growth Fund
Pilgrim LargeCap Growth Fund
Pilgrim MidCap Growth Fund
Pilgrim Money Market Fund
Pilgrim SmallCap Growth Fund
Pilgrim Strategic Income Fund
Pilgrim Worldwide Growth Fund
PILGRIM SENIOR INCOME FUND
PILGRIM ADVISORY FUNDS, INC.
Pilgrim Asia-Pacific Equity Fund
PILGRIM BANK AND THRIFT FUND, INC.
43
PILGRIM EMERGING MARKETS FUND, INC.
PILGRIM GNMA INCOME FUND, INC.
PILGRIM PRECIOUS METALS FUND, INC.
PILGRIM GROWTH AND INCOME FUND, INC.
PILGRIM INVESTMENT FUNDS, INC.
Pilgrim High Yield Fund
Pilgrim MagnaCap Fund
PILGRIM INTERNATIONAL FUND, INC.,
PILGRIM RUSSIA FUND, INC.
By: /s/ Xxxxxx X. Naka
------------------------------------------
Title: Senior Vice President
---------------------------------------
Date: 11/30/2000
----------------------------------------
44
EXHIBIT A
Open/ State of Taxpayer
Taxpayer/Fund Name Type of Organization Closed Organization I.D. No.
------------------ -------------------- ------ ------------ --------
LEXINGTON MONEY MARKET TRUST Business Trust Massachusetts 00-0000000
PILGRIM EQUITY TRUST Business Trust Massachusetts N/A
Pilgrim Index Plus Protection Fund 00-0000000
Pilgrim MidCap Opportunities Fund 00-0000000
PILGRIM GROWTH OPPORTUNITIES FUND Business Trust Massachusetts 00-0000000
PILGRIM MAYFLOWER TRUST Business Trust Massachusetts N/A
Pilgrim Growth + Value Fund 00-0000000
Pilgrim International Value Fund 00-0000000
Pilgrim Research Enhanced Index Fund 00-0000000
PILGRIM NATURAL RESOURCES TRUST Business Trust Massachusetts 00-0000000
PILGRIM PRIME RATE TRUST Business Trust Massachusetts 00-0000000
PILGRIM SMALLCAP OPPORTUNITIES FUND Business Trust Massachusetts 00-0000000
PILGRIM VARIABLE PRODUCTS TRUST Business Trust Massachusetts N/A
Pilgrim VP Convertible Portfolio 00-0000000
Pilgrim VP Emerging Countries Portfolio 00-0000000
Pilgrim VP Financial Services Portfolio 00-0000000
Pilgrim VP Growth & Income Portfolio 00-0000000
Pilgrim VP Growth + Value Portfolio 00-0000000
Pilgrim VP Growth Opportunities Portfolio 00-0000000
Pilgrim VP High Yield Bond Portfolio 00-0000000
Pilgrim VP International Portfolio 00-0000000
Pilgrim VP International SmallCap Growth 00-0000000
Portfolio
45
Open/ State of Taxpayer
Taxpayer/Fund Name Type of Organization Closed Organization I.D. No.
------------------ -------------------- ------ ------------ --------
Pilgrim VP International Value Portfolio 00-0000000
Pilgrim VP LargeCap Growth Portfolio 00-0000000
Pilgrim VP MargnaCap Portfolio 00-0000000
Pilgrim XX XxxXxx Opportunities Portfolio 00-0000000
Pilgrim VP Research Enhanced Index Portfolio 00-0000000
Pilgrim VP SmallCap Opportunities Portfolio 00-0000000
Pilgrim VP Worldwide Growth Portfolio 00-0000000
Pilgrim Funds Trust Business Trust Delaware
Pilgrim European Equity Fund 00-0000000
Pilgrim Global Communications Fund 00-0000000
Pilgrim Global Information Technology Fund 00-0000000
Pilgrim Intermediate Bond Fund 00-0000000
Pilgrim Internet Fund 00-0000000
ING Pilgrim Money Market Fund 00-0000000
Pilgrim National Tax-Exempt Bond Fund 00-0000000
Pilgrim Tax Efficient Equity Fund 00-0000000
Pilgrim Mutual Funds Business Trust Delaware N/A
Pilgrim Balanced Fund 00-0000000
Pilgrim Convertible Fund 00-0000000
Pilgrim Emerging Countries Fund 00-0000000
Pilgrim High Yield Fund II 00-0000000
Pilgrim International Core Growth Fund 00-0000000
Pilgrim International SmallCap Growth Fund 00-0000000
Pilgrim LargeCap Growth Fund 00-0000000
Pilgrim MidCap Growth Fund 00-0000000
Pilgrim Money Market Fund 00-0000000
Pilgrim SmallCap Growth Fund 00-0000000
Pilgrim Strategic Income Fund 00-0000000
Pilgrim Worldwide Growth Fund 00-0000000
Pilgrim Senior Income Fund Business Trust Delaware 00-0000000
46
Open/ State of Taxpayer
Taxpayer/Fund Name Type of Organization Closed Organization I.D. No.
------------------ -------------------- ------ ------------ --------
PILGRIM ADVISORY FUNDS, INC. Corporation Maryland
Pilgrim Asia-Pacific Equity Fund 00-0000000
PILGRIM BANK AND THRIFT FUND, INC. Corporation Maryland 00-0000000
PILGRIM EMERGING MARKETS FUND, INC. Corporation Maryland 00-0000000
Pilgrim GNMA Income Fund, Inc. Corporation Maryland 00-0000000
Pilgrim Precious Metals Fund, Inc. Corporation Maryland 00-0000000
PILGRIM GROWTH AND INCOME FUND, INC. Corporation Maryland 00-0000000
PILGRIM INVESTMENT FUNDS, INC. Corporation Maryland
Pilgrim High Yield Fund 00-0000000
Pilgrim MagnaCap Fund 00-0000000
PILGRIM INTERNATIONAL FUND, INC., Corporation Maryland 00-0000000
PILGRIM RUSSIA FUND, INC. Corporation Maryland 00-0000000
47
EXHIBIT B, P. 1
DST SYSTEMS, INC.
PILGRIM TRANSFER AGENCY FEE SCHEDULE
EFFECTIVE AUGUST 1, 2000 - MAY 31, 2002
ASSET BASED FEES:
NET ASSETS PER PORTFOLIO:
$0 - $100,000,000 9.0 basis pts per year
$100,000,001- $300,000,000 8.5 basis pts per year
$300,000,001 - $500,000,000 7.5 basis pts per year
Greater than $500,000,000 7.25 basis pts per year
(Applies to all Lexington and Pilgrim Cusips, including new Q share
portfolio classes established as a result of the Northstar conversion)
EXCEPTIONS:
Prime Rate Trust 2.4 basis pts per year
Bank & Thrift 24.2 basis pts per year
Pilgrim Investment Plan $7,200 per year
Northstar Funds Covered under separate
agreement
ING Money Market Portfolio 6.0 basis pts per year
(effective 12/1/01)
BUNDLED PRODUCTS AND SERVICES:
The above asset fees cover a comprehensive bundle of products
and services. The following products and services are not
covered by the asset fees and will continue to be billed
separately using the current rates, subject to current
allowable periodic increases:
* AWD License Fees
* Escheatment
* Programming
* FANMail
* Vision
48
EXHIBIT B, P. 2
Additional products and services not currently utilized would
be priced separately and would be billed in addition to the
asset fees.
*Computer/Technical Personnel (2000 Rates):
Business Analyst/Tester:
Dedicated - $79,040 per year
On Request - $72.80 per hour
COBOL Programmer:
Dedicated - $129,480 per year
On Request - $100.88 per hour
Workstation Programmer:
Dedicated - $157,040 per year
On Request - $128.96 per hour
*Full Service Support (2000 Rates):
Senior Staff Support - $70.00 per hour
Staff Support - $50.00 per hour
Clerical Support - $40.00 per hour
RATE ADJUSTMENT TRIGGERS:
The above asset fees would be adjusted monthly based on the
following triggers:
Should either "Average Assets per Account" or "Average Assets
per CUSIP" decrease 10% in a given month from their baseline
March through May 2000 averages, the basis point fee rates
would be adjusted up using the formula: Previous Rate divided
by .9. When/if a rate adjustment is made, both trigger ratios
would be reset at new levels equal to 10% below their previous
level. Subsequent adjustments to the rates would be triggered
should these ratios decrease in additional 10% increments.
Downward adjustments would be made to the rates using the same
formula should the trigger ratios increase in 10% increments,
but only to the extent that previous upward rate adjustments
have been made. The basis point fee rates could not be
adjusted below the original rates listed above.
TRIGGERS:
Average Assets per Account Average Assets per Cusip
-------------------------- ------------------------
Bank & Thrift $9,733 $184,696,341
Prime Rate $113,660 $1,259,736,679
All Others $29,452 $63,379,993
49
EXHIBIT B, P. 3
NOTES TO THE ABOVE FEE SCHEDULE
A. The above schedule does not include reimbursable expenses that are
incurred on the Fund's behalf. Examples of reimbursable expenses
include but are not limited to those set forth on Exhibit C to this
Agreement. Reimbursable expenses are billed separately from service
fees on a monthly basis.
B. Any fees or reimbursable expenses not paid within 30 days of the date
of the original invoice will be charged a late payment fee of 1.5% per
month until payment is received.
C. The above fees, except for those indicated by an "*", are guaranteed
through May 31, 2002. All items marked by an "*" are subject to change
with 60 day notice.
50
EXHIBIT B.1, P.1
TA2000 VOICE SYSTEM
FEE SCHEDULE
PER CALL SERVICE FEE
Utilization of DST's TA2000 Voice System is based on a service fee of $.20 per
call. Each call has a maximum duration of seven (7) minutes. This charge is a
flat rate regardless of the number or type of transactions that a shareholder
processes during the call. A given call could result in inquiries and/or
transactions being processed for various funds in the complex. Therefore, on a
monthly basis, DST will report the number of inquiries and/or transactions
processed by fund. A percentage of the total will be derived and reported for
each fund. As a result of this process, DST will allocate the charges among the
individual funds.
MULTIPLE CALL FLOWS
An additional fee of $500 per month will be charged for each additional call
flow that requires different flows, functions, vocabulary, processing, rules or
access method. An additional fee of $200 per month will be charged for each
additional call flow that is identical in flows, functions, vocabulary,
processing rules or access method.
MINIMUM MONTHLY CHARGE
DST's commitment to the reliability and continued enhancement of the TA2000
Voice System necessitates a minimum monthly charge for the service. The minimum
monthly charge will only be assessed when it is greater than the monthly service
fees. The minimum monthly charge will be implemented on a graduated basis based
on the number of cusips and shareholders in a fund complex and is the sum of the
cusip and account charges. The schedule for this charge is as follows:
YEARS CHARGE PER CHARGE PER
OF CUSIP AUTHORIZED SHAREHOLDER
SERVICE FOR SERVICE* ACCOUNT**
1 $ 50 $.002
2 $ 75 $.003
3 $100 $.004
* CUSIPS ADDED TO THE SERVICE will be subject to the same
minimums being charged to the other cusips in the complex at
the time the cusips are added.
** THE PER ACCOUNT CHARGE is based on the total number of
shareholder accounts in authorized cusips at the end of each
month.
OUT OF POCKET COSTS
Each fund complex will require a unique WATS number for their shareholders to
call. Each WATS number will require a specific number of trunks to service a
given volume of shareholder calls. All installation and monthly usage charges
associated with these will be billed through monthly out-of-pocket invoices.
51
EXHIBIT B.2, P. 1
NSCC FEES AND OUT-OF-POCKET EXPENSES
DST Fees
DST charges $1,500 per cusip per year for the NSCC platform
Settling Bank Fees
Fund may be charged fees by the Settling Bank at which the net
settlement account resides for monthly maintenance of this account.
These are negotiated directly between Fund and the Settling Bank.
NSCC Participant Fees
The NSCC charges $40 per month per management company for CPU
access/shared line costs.
A combined participant base fee of $200 per month is charged for the
following services:
Fund/SERV:
The NSCC charges an activity charge of $.30 per inputted transaction.
Transactions include purchases, redemptions and exchanges.
Networking: The NSCC charges the following activity fee:
- $.02 per account for funds paying dividends on a monthly basis
- $.01 per account for funds paying dividends other than monthly
Commission Settlement: The NSCC charges the following processing fee:
- $.30 per hundred records, per month, for one to 500,000
records; there is a $50 per month minimum processing charge
- $.20 per hundred records, per month, for 500,001 to 1,000,000
records
- $.10 per hundred records, per month, for 1,000,001 records and
above
Note: Participant fees are cumulative when Fund/SERV, Networking and/or
Commission Settlement are used in conjunction with each other.
52
EXHIBIT C
REIMBURSABLE EXPENSES
Forms
Postage (to be paid in advance if so requested)
Mailing Services
Computer Hardware and Software - specific to Fund or installed at remote site
at Fund's direction
Telecommunications Equipment and Lines/Long Distance Charges
Magnetic Tapes, Reels or Cartridges
Magnetic Tape Handling Charges
Microfiche/Microfilm/CD ROM
Freight Charges
Printing
Bank Wire and ACH Charges
Proxy Processing - per proxy mailed
not including postage
Includes: Proxy Card
Printing
Outgoing Envelope
Return Envelope
Tabulation and Certification
Tax Certification Mailings (e.g., W-8 & W-9)
(Postage associated with the return
envelope is included)
N.S.C.C. Communications Charge
(Fund/Serv and Networking)
Record Storage (hardcopy/microfiche/on-call)
Second Site Disaster Currently $.10
Backup Fee (per account) through 12/31/01, subject to
annual adjustment
Transmission of Statement Data for Currently $.035/per
Remote Processing record
Travel, Per Diem and other Billables
Incurred by DST personnel traveling to,
at and from Fund at the request
of Fund
53
EXHIBIT D
AUTHORIZED PERSONNEL
Pursuant to Section 8.A. of the Agency Agreement between Fund and DST (the
"Agreement"), Fund authorizes the following Fund personnel to provide
instructions to DST, and receive inquiries from DST in connection with the
Agreement:
Name Title
---- -----
----------------------------- --------------------------------
----------------------------- --------------------------------
----------------------------- --------------------------------
----------------------------- --------------------------------
----------------------------- --------------------------------
----------------------------- --------------------------------
----------------------------- --------------------------------
----------------------------- --------------------------------
This Exhibit may be revised by Fund by providing DST with a substitute Exhibit
D. Any such substitute Exhibit B shall become effective twenty-four (24) hours
after DST's receipt of the document and shall be incorporated into the
Agreement.
ACKNOWLEDGMENT OF RECEIPT:
DST SYSTEMS, INC.
By: /s/ Xxxxxxxx Xxxxx
----------------------------
Title: Group VP
----------------------------
Date: 11/30/2000
----------------------------
54
LEXINGTON MONEY MARKET TRUST
PILGRIM EQUITY TRUST
Pilgrim Index Plus Protection Fund
Pilgrim MidCap Opportunities Fund
PILGRIM GROWTH OPPORTUNITIES FUND
PILGRIM MAYFLOWER TRUST
Pilgrim Growth + Value Fund
Pilgrim International Value Fund
Pilgrim Research Enhanced Index Fund
PILGRIM NATURAL RESOURCES TRUST
PILGRIM PRIME RATE TRUST
PILGRIM SMALLCAP OPPORTUNITIES FUND
PILGRIM VARIABLE PRODUCTS TRUST
Pilgrim VP Convertible Portfolio
Pilgrim VP Emerging Countries Portfolio
Pilgrim VP Financial Services Portfolio
Pilgrim VP Growth & Income Portfolio
Pilgrim VP Growth + Value Portfolio
Pilgrim VP Growth Opportunities Portfolio
Pilgrim VP High Yield Bond Portfolio
Pilgrim VP International Portfolio
Pilgrim VP International SmallCap Growth
Portfolio
Pilgrim VP International Value Portfolio
Pilgrim VP LargeCap Growth Portfolio
Pilgrim VP MargnaCap Portfolio
Pilgrim XX XxxXxx Opportunities Portfolio
Pilgrim VP Research Enhanced Index
Portfolio
Pilgrim VP SmallCap Opportunities
Portfolio
Pilgrim VP Worldwide Growth Portfolio
PILGRIM FUNDS TRUST
Pilgrim European Equity Fund
Pilgrim Global Communications Fund
Pilgrim Global Information Technology
Fund
Pilgrim Intermediate Bond Fund
Pilgrim Internet Fund
ING Pilgrim Money Market Fund
Pilgrim National Tax-Exempt Bond Fund
Pilgrim Tax Efficient Equity Fund
PILGRIM MUTUAL FUNDS
Pilgrim Balanced Fund
Pilgrim Convertible Fund
Pilgrim Emerging Countries Fund
Pilgrim High Yield Fund II
Pilgrim International Core Growth Fund
Pilgrim International SmallCap Growth
Fund
Pilgrim LargeCap Growth Fund
Pilgrim MidCap Growth Fund
55
Pilgrim Money Market Fund
Pilgrim SmallCap Growth Fund
Pilgrim Strategic Income Fund
Pilgrim Worldwide Growth Fund
PILGRIM SENIOR INCOME FUND
PILGRIM ADVISORY FUNDS, INC.
Pilgrim Asia-Pacific Equity Fund
PILGRIM BANK AND THRIFT FUND, INC.
PILGRIM EMERGING MARKETS FUND, INC.
PILGRIM GNMA INCOME FUND, INC.
PILGRIM PRECIOUS METALS FUND, INC.
PILGRIM GROWTH AND INCOME FUND, INC.
PILGRIM INVESTMENT FUNDS, INC.
Pilgrim High Yield Fund
Pilgrim MagnaCap Fund
PILGRIM INTERNATIONAL FUND, INC.,
PILGRIM RUSSIA FUND, INC.
By: /s/ Xxxxxx X. Naka
-----------------------------------
Title: Senior Vice President
--------------------------------
Date: 11/30/2000
----------------------------------
56
