TRANSFER AGENCY AND SERVICE AGREEMENT
FOR
XXXX XXXXXXX FUNDS
This Transfer Agency and Service Agreement is made as of the 1st day of
June, 2007 by and between each investment company advised by Xxxx Xxxxxxx
Advisers, Inc. and identified on Exhibit A attached hereto (individually the
"Fund" and collectively the "Funds"), each a Massachusetts business trust having
its principal office and place of business at 000 Xxxxxxxx Xxxxxx, Xxxxxx,
Xxxxxxxxxxxxx, 00000 and Xxxx Xxxxxxx Signature Services, Inc. ("JHSS"), a
Delaware corporation having its principal office and place of business at 000
Xxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx, 00000 ("JHSS").
WITNESSETH:
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WHEREAS, the Fund is registered as an open-end management investment
company under the Investment Company Act of 1940, as amended; and
WHEREAS, JHSS is registered with the Securities and Exchange Commission as
a transfer agent under the Securities and Exchange Act of 1934, as amended; and
WHEREAS, the Fund wishes to retain JHSS to serve as transfer agent,
dividend disbursing agent, shareholder servicing agent and agent in connection
with certain other activities to the Funds' investment portfolio series listed
on Exhibit A attached hereto and incorporated herein by reference, as such
Exhibit A may be amended from time to time (each a "Portfolio"), and JHSS
desires to accept such appointment and provide such services.
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
the parties hereto agree as follows:
Article 1 Definitions
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1.01 Whenever used in this Agreement, the following words and phrases, unless
the context otherwise requires, shall have the following meanings:
(a) "1934 Act" shall mean the Securities Exchange Act of 1934 and the rules and
regulations promulgated thereunder, all as amended from time to time.
(b) "1940 Act" shall mean the Investment Company Act of 1940 and the rules and
regulations promulgated thereunder, all as amended from time to time.
(c) "Articles of Incorporation" shall mean the Articles of Incorporation,
Declaration of Trust, or other similar organizational document as the case
may be, of the Fund as the same may be amended from time to time.
(d) "Authorized Person" shall mean (i) any officer of the Fund; (ii) or any
person, whether or not such person is an officer or employee of the Fund,
duly authorized by an authorized officer of the Fund to give Oral
Instructions or Written Instructions on behalf of the Fund as indicated in
writing to JHSS Agent from time to time.
(e) "Board Members" shall mean the Trustees of the governing body of the Fund.
(f) "Board" shall mean the Board of Trustees of the Fund.
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(g) "Class" shall mean a class of shares of the Fund or Portfolio.
(h) "Commission" shall mean the Securities and Exchange Commission.
(i) "Custodian" shall mean any custodian or subcustodian of securities and
other property which the Fund or Portfolio may from time to time deposit,
or cause to be deposited or held under the name or account of such a
custodian pursuant to a Custodian Agreement.
(j) "Oral Instructions" shall mean oral instructions received by JHSS from an
Authorized Person or from a person reasonably believed by JHSS to be an
Authorized Person.
(k) "Prospectus" shall mean the most recently dated Fund or Portfolio
Prospectus and Statement of Additional Information, including any
supplements thereto if any, which has become effective under the Securities
Act of 1933 and the 1940 Act.
(l) "Shares" shall mean, collectively, such shares of capital stock or
beneficial interest, as the case may be, or class thereof, of the Fund or
Portfolio as may be issued from time to time.
(m) "Shareholder" shall mean a holder of Shares of the Fund or Portfolio.
(n) "Written Instructions" shall mean (i) written instructions signed by an
Authorized Person and received by JHSS or (ii) trade instructions
transmitted (and received by JHSS) by means of an electronic transaction
reporting system access to which requires use of a password or other
authorized identifier. The instructions may be delivered electronically
(with respect to sub-item (ii) above) or by hand, mail, tested telegram,
cable, telex or facsimile sending device.
Article 2 Terms of Appointment and Services
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2.01 Appointment. Subject to the terms and conditions set forth in this
Agreement, the Fund hereby employs and appoints JHSS to act, and JHSS agrees to
act, as transfer agent and dividend disbursing agent with respect to the
authorized and issued Shares of the Fund subject to this Agreement and to
provide to the Shareholders such services in connection therewith as may be set
out in the prospectus of the Fund from time to time.
2.02 General Services. JHSS shall be responsible for administering and/or
performing the customary services of a transfer agent and dividend disbursing
agent; acting as service agent in connection with dividend and distribution
functions; and for performing shareholder account and administrative agent
functions in connection with the issuance, transfer and redemption or repurchase
(including coordination with the Custodian) of Shares of each Fund, as more
fully described in Schedule 1 - Duties of JHSS attached hereto and made part
hereof, and in accordance with the terms of the Prospectus and Statement of
Additional Information of the Fund, applicable laws and the procedures
established from time to time between the Fund and JHSS.
2.03 State Registration. The Fund shall (a) identify to JHSS in writing those
transactions and assets to be treated as exempt from the blue sky reporting for
each State and (b) verify the establishment of transactions for each State on
the system prior to activation and thereafter monitor the daily activity for
each State. The responsibility of JHSS for the Fund's blue sky State
registration status is solely limited to the initial establishment of
transactions subject to blue sky compliance by the Fund and the reporting of
these transactions to the Fund as provided above.
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2.04 As-of Transactions. An "as-of" transaction is defined as a transaction
processed at a time other than the time of the computation of net asset value
per share next computed after receipt of such orders. The effective date of such
transactions will be a date prior to the processing date. The difference in the
share price between the "as-of" trade date and the processing date could result
in a gain or loss to the Share class of a Portfolio and may increase or dilute
the assets of the affected Share class or any dividends paid by the Portfolio
with respect to such Share class during the Accumulation Period (as defined
below).
(a) With respect to this Section 2.04:
(i) "Accumulation Period" shall mean a calendar year;
(ii) "Materiality" shall mean the point at which the net asset value of the
Share class is impacted to the extent described in Section 2.04(a)(iii)
below;
(iii) "As-of" impact will be considered material if the cumulative net
effect is greater than or equal to $.005 per outstanding share over the
Accumulation Period; and
(iv) Gains or losses that do not impact the net asset value (NAV) of the
Share class (as described in Section 2.04(a)(iii)) of the Portfolio shall
be deemed immaterial.
(b) With respect to the treatment of financial gains and losses resulting from
"as-of" transactions in each Share class of the Portfolios, JHSS shall
utilize a system to identify and track, at the Share class level, both on a
daily and cumulative basis, the impact of all "as-of" transactions
processed. This tracking will be reflected on the daily report prepared by
JHSS. Daily and cumulative gain/loss balances will be reported "net" at the
Share class level.
(c) If upon any day during the Accumulation Period, the cumulative net effect
of "as-of" transactions on the Fund is negative and is greater than or
equal to $.005 per outstanding share, JHSS will (i) notify the Fund; and
(ii) work closely with the Fund to identify and resolve the loss amount. In
addition, the Fund will cause its fund accounting agent to book the
appropriate payable/receivable entry in order to "keep the Share class
whole".
(d) Upon confirmation of any such material cumulative loss within the relevant
Accumulation Period, JHSS will reimburse the Fund in such amount as may be
necessary to reduce the negative cumulative net effect to less than $.005
per outstanding share.
(e) At the end of the Accumulation Period, any positive cumulative net effect
upon a Fund of such transactions shall be deemed to be a credit to JHSS
which shall first be applied to permit JHSS to recover any prior cash
payments made by it to the Fund under Section 2.04(d) above during the
Accumulation Period, in an amount equal to prior payments made by JHSS
during such Accumulation Period, but not exceeding the sum of that
Accumulation Period's credit. Any portion of a credit to JHSS not so used
by it by the end of an Accumulation Period will not be allowed to be used
as payment against the amount of any future negative cumulative net effects
that would otherwise require a cash payment. The cumulative net effect upon
the Share class of each Portfolio shall be reset to zero for the
transactions of the first business day of the next Accumulation Period.
(f) For Selling Firm or Broker errors, JHSS shall make a reasonable attempt to
recover any negative net effect upon a Fund over $100 from the Selling firm
or broker that caused the error. At the end of each month, the receivables
collected under this program shall be sent to the Fund. However, if a
Selling Firm or Broker error had caused the cumulative negative net effect
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upon a Fund to exceed the threshold described in paragraph 2.04(c),
prompting JHSS to make a payment to the Fund, the amount will be withheld
from the collected amount by JHSS.
(g) JHSS shall supply to the Fund from time to time, as mutually agreed upon,
reports summarizing the as-of transactions identified pursuant to this
Section 2.04, and the daily and cumulative net effects of such as-of
transactions, and shall advise the Fund at the end of each month of the net
cumulative effect at such time. JHSS shall promptly advise the Fund if at
any time the cumulative net effect is greater than or equal to $.005 per
outstanding share.
2.05 Anti-Money Laundering.
(a) Delegation. The Fund hereby delegates to JHSS responsibility for the
implementation and operation of the following policies and procedures in
connection with the Xxxx Xxxxxxx Funds, LLC ("JHF") AML Program: (i)
customer identification procedures ("CIP") by October 1, 2003, including
Office of Foreign Asset Control list screening procedures; (ii) monitoring
accounts and identifying high risk accounts according to the current JHSS
procedures; (iii) no cash policy; (iv) policies and procedures for
correspondent accounts for foreign financial institutions and for private
banking accounts for non-U.S. persons; (v) detecting and reporting
suspicious activity to the Fund's designee (Manulife US Compliance); (vi)
procedures for researching and responding to law enforcement requests to
Financial Institutions under Section 314(a) of the USA PATRIOT Act; (vii)
policies and procedures for reliance on third parties with whom JHSS
contracts, and (viii) all related recordkeeping requirements. JHSS accepts
such delegation and further agrees to cooperate with the Fund's AML
Compliance Officer in the performance of JHSS's responsibilities under the
JHF AML Program.
(b) The AML Program. JHSS hereby represents and warrants that JHSS has received
a copy of the Fund's current JHF AML Program and undertakes to perform all
responsibilities imposed on JHSS as a service provider as determined
therein. The Fund hereby agrees to provide to JHSS any amendment(s) to the
JHF AML Program promptly after adoption of any such amendment(s) by the
Fund.
(c) Consent to Examination. JHSS hereby consents to: (i) provide to federal
examination authorities information and records relating to the JHF AML
Program maintained by JHSS; and (ii) the inspection of the JHF AML Program
by federal examination authorities or the Fund's delegate.
(d) Anti-Money Laundering Program. JHSS hereby represents and warrants that it
has implemented and enforces an Anti-Money Laundering Program that complies
with laws, regulations and regulatory guidance applicable to the Funds and
JHSS and includes, or will include, not later than the effective date(s) of
such laws, regulations and regulatory guidance the following:
(i) CIP, separately, or in conjunction with JHF or Fund procedures,
including Office of Foreign Asset Control list screening procedures;
(ii) due diligence policies for correspondent accounts for foreign
financial institutions and for private banking accounts for non-U.S.
persons;
(iii) reasonable internal procedures and controls to detect and report
suspicious activities to the Fund's designee (Manulife US Compliance);
(iv) procedures to monitor accounts and identify high-risk accounts;
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(v) procedures for researching and escalating responses to law enforcement
requests to Financial Institutions under Section 314(a) of the USA PATRIOT
Act;
(vi) a compliance officer or committee with responsibility for implementing
the anti-money laundering employee training, including that: (1) new
employees receive anti-money laundering training upon the commencement of
their employment; and (2) existing employees receive anti-money laundering
training at the time such employees assume duties that bring them into
contact with possible money laundering activities; and
(vii) procedures to address all related recordkeeping requirements.
(e) Delivery of Documents. JHSS agrees to furnish to the Fund and JHF the
following documents:
(i) a copy of the JHSS AML Program as in effect on the date hereof, and any
material amendment thereto, including the CIP, promptly after the adoption
of any such amendment;
(ii) a copy of any deficiency letter sent by federal examination
authorities concerning the JHSS AML Program;
(iii) periodic reports concerning JHSS's compliance with the JHSS AML
Program and/or the JHF AML Program at such times as may be reasonably
requested by the Fund's Board of Trustees or Anti-Money Laundering
Compliance Officer; and
(iv) annual certification to the Funds and JHF that JHSS has implemented an
anti-money laundering program, including the CIP, and will perform (or its
agent will perform) the specified requirements of the anti-money laundering
programs, including the CIP, of the Funds and JHF as specified in this
Agreement.
2.06 Privacy.
(a) JHSS will not disclose any customer information provided to it by or on
behalf of Fund to any unaffiliated third party except to the extent
reasonably necessary to satisfy the purpose for which the customer
information was provided to JHSS, and provided that JHSS will impose on
such third party the same confidentiality requirements that JHSS are
required to abide by with respect to the customer information.
(b) JHSS will not use customer information for any purpose other than the
specific purpose for which it was provided to JHSS by or on behalf of Fund,
and will make customer information available to its employees only as
reasonably necessary to satisfy the purpose for which the customer
information was provided.
(c) JHSS will maintain reasonable security guidelines to ensure its ability to
comply with the requirements set forth in this Section 2.06.
2.07 Cash Management Accounts. JHSS shall establish certain cash management
accounts ("Service Accounts") as necessary to provide services under this
Agreement. JHSS may receive interest/investment earnings and/or balance credits
("Service Account Earnings") earned with respect to the funds in such Service
Accounts. Any such Services Account Earnings will be used by JHSS to offset (a)
the banking service fees imposed by the cash management service provider; and
(b) transfer agent fees and out-of-pocket expenses owed by the Fund.
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2.08 Additional Services. In addition to the transfer agent services provided by
JHSS to the Fund hereunder, the Fund may request and JHSS may provide such other
services as may be agreed to by the Fund and JHSS from time to time. Such
services shall be as described on Schedule 1.1 attached hereto and made part
hereof.
Article 3 Fees and Expenses.
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3.01 For performance by JHSS of the transfer agent services pursuant to this
Agreement, the Fund agrees to pay JHSS the fees as set out in Exhibit B attached
hereto and made part hereof.
3.02 For performance by JHSS of the additional services set forth on Schedule
1.1 pursuant to this Agreement, the Fund agrees to pay JHSS the fees as set out
in Exhibit B.1 attached hereto and made part hereof.
3.03 In addition to the fee paid under Section 3.01 above, the Fund agrees to
reimburse JHSS for out-of-pocket expenses and/or advances incurred by JHSS for
the items set out in Exhibit C attached hereto and made part hereof. In
addition, any other expenses incurred by JHSS at the request or with the consent
of the Fund, will be reimbursed by the Fund.
3.04 The Fund agrees to pay all fees and reimbursable expenses promptly
following the mailing of the respective billing notice.
3.05. Such fees and out-of-pocket expenses and advances reference in this
Article 3 may be changed from time to time subject to mutual written agreement
between the Fund and JHSS.
Article 4 Representations and Warranties of JHSS.
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JHSS represents and warrants to the Fund that:
4.01 It is a corporation duly organized and existing and in good standing
under the laws of the State of Delaware, and is duly qualified and in good
standing as a foreign corporation under the Laws of The Commonwealth of
Massachusetts.
4.02 It has corporate power and authority to enter into and perform its
obligations under this Agreement.
4.03 All requisite corporate proceedings have been taken to authorize it to
enter into and perform this Agreement.
4.04 It has and will continue to have access to the necessary facilities,
equipment and personnel to perform its duties and obligations under this
Agreement;
4.05 It is a transfer agent fully registered as a transfer agent pursuant to
Section 17A(c)(2) of the 1934 Act, and such registration will remain in effect
for the duration of this Agreement; and
4.06 It shall adopt and maintain such policies, procedures and controls
reasonably designed to ensure that the performance of its obligations as set
forth in this Agreement is in compliance with all applicable rules and
regulations, including, but not limited to those rules and regulations
applicable to transfer agents performing such services as described in this
Agreement.
Article 5 Representations and Warranties of the Fund
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The Fund represents and warrants to JHSS that:
5.01 It is a business trust duly organized and existing and in good standing
under the laws of The Commonwealth of Massachusetts.
5.02 It has the power and authority to enter into and perform this Agreement.
5.03 All proceedings required by the Fund's Declaration of Trust and By-Laws
have been taken to authorize it to enter into and perform this Agreement.
5.04 It is an open-end investment company registered under the 40 Act.
5.05 A registration statement under the Securities Act of 1933, as amended,
with respect to the shares of the Fund subject to this Agreement has become
effective, and appropriate state securities law filings have been made and will
continue to be made.
Article 6 Indemnification
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6.01 JHSS shall not be responsible for, and the Fund shall indemnify and hold
JHSS harmless from and against, any and all losses, damages, costs, charges,
counsel fees, payments, expenses and liabilities arising out of or attributable
to:
(a) All actions of JHSS or its agents or subcontractors required to be taken
pursuant to this Agreement, provided that such actions are taken in good
faith and without negligence or willful misfeasance.
(b) The Fund's refusal or failure to comply with the terms of this Agreement,
or which arise out of the Fund's bad faith, gross negligence or willful
misfeasance or which arise out of the reckless disregard of any
representation or warranty of the Fund hereunder.
(c) The reliance on or use by JHSS or its agents or subcontractors of
information, records and documents which (i) are received by JHSS or its
agents or subcontractors and furnished to it by or on behalf of the Fund,
and (ii) have been prepared and/or maintained by the Fund or any other
person or firm on behalf of the Fund.
(d) The reliance on, or the carrying out by JHSS or its agents or
subcontractors of, any instructions or requests of the Fund.
(e) The offer or sale of Shares in violation of any requirement under the
federal securities laws or regulations or the securities laws or
regulations of any state that Fund Shares be registered in that state or in
violation of any stop order or other determination or ruling by any federal
agency or any state with respect to the offer or sale of Shares in that
state.
(f) It is understood and agreed that the assets of the Fund may be used to
satisfy the indemnity under this Article 6 only to the extent that the
loss, damage, cost, charge, counsel fee, payment, expense and liability
arises out of or is attributable to services hereunder with respect to the
Shares of such Fund.
6.02 JHSS shall indemnify and hold harmless the Fund from and against any and
all losses, damages, costs, charges, counsel fees, payments, expenses and
liabilities arising out of or attributed to any action or failure or omission to
act by JHSS as a result of JHSS's lack of good faith, negligence or willful
misfeasance.
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6.03 At any time JHSS may apply to any officer of the Fund for instructions,
and may consult with legal counsel with respect to any matter arising in
connection with the services to be performed by JHSS under this Agreement, and
JHSS and its agents or subcontractors shall not be liable and shall be
indemnified by the Fund for any action taken or omitted by it in reliance upon
such instructions or upon the opinion of such counsel. JHSS, its agents and
subcontractors shall be protected and indemnified in acting upon any paper or
document furnished by or on behalf of the Fund, reasonably believed to be
genuine and to have been signed by the proper person or persons, or upon any
instruction, information, data, records or documents provided JHSS or its agents
or subcontractors by machine readable input, telex, CRT data entry or other
similar means authorized by the Fund, and shall not be held to have notice of
any change of authority of any person, until receipt of written notice thereof
from the Fund. JHSS, its agents and subcontractors shall also be protected and
indemnified in recognizing share certificates which are reasonably believed to
bear the proper manual or facsimile signatures of the officer of the Fund, and
the proper countersignature of any former transfer agent or registrar, or of a
co-transfer agent or co-registrar.
6.04 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.
6.05 Neither party to this Agreement shall be liable to the other party for
consequential damages under any provision of this Agreement or for any act or
failure to act hereunder.
6.06 In order that the indemnification provisions contained in this Article 6
shall apply, upon the assertion of a claim for which either party may be
required to indemnify the other, the party seeking indemnification shall
promptly notify the other party of such assertion, and shall keep the other
party advised with respect to all developments concerning such claim. The party
who may be required to indemnify shall have the option to participate with the
party seeking indemnification in the defense of such claim. The party seeking
indemnification shall in no case confess any claim or make any compromise in any
case in which the other party may be required to indemnify it except with the
other party's prior written consent.
Article 7 Covenants of the Fund and JHSS
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7.01 The Fund shall promptly furnish to JHSS the following:
(a) A certified copy of the resolution(s) of the Trustees of the Trust or the
Directors of the Corporation authorizing the appointment of JHSS and the
execution and delivery of this Agreement.
(b) A copy of the Fund's Declaration of Trust or Articles of Incorporation
and By-Laws and all amendments thereto.
7.02 JHSS hereby agrees to establish and maintain facilities and procedures
reasonably acceptable to the Fund for safekeeping of share certificates and
facsimile signature imprinting devices, if any; and for the preparation or use,
and for keeping account of, such certificates and devices. In addition to the
foregoing and notwithstanding Section 6.04 to the contrary, JHSS shall establish
and maintain business continuity and resumption plans and arrangements designed
to minimize any disruption to the services performed by JHSS hereunder which
shall at a minimum include the ability to provide services from a back-up
facility at a remote location and shall upon request provide a copy of such
plans to the Fund.
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7.03 Subject to the following sentence, JHSS shall create and maintain in
complete and accurate form all books and records required of it pursuant to its
duties hereunder in accordance with all applicable laws, rules and regulations,
including but not limited to records required by the 1934 Act and 1940 Act. To
the extent required by Section 31 of the 1940 Act and the rules and regulations
of the SEC thereunder, JHSS agrees that all such records prepared or maintained
by JHSS relating to the services to be performed by JHSS hereunder are the
property of the Fund and will be preserved, maintained and made available in
accordance with such Act and rules, and will be surrendered to the Fund promptly
on and in accordance with the Fund's request.
7.04 JHSS and the Fund agree that all books, records, information and data
pertaining to the business of the other party which are exchanged or received
pursuant to the negotiation or the carrying out of this Agreement shall remain
confidential, and shall not be voluntarily disclosed to any other person without
the consent of the other party to this Agreement, except as may be required by
law.
7.05 JHSS agrees that, from time to time or at any time requested by the Fund,
JHSS will make reports to the Fund, as requested, of JHSS's performance of the
foregoing services.
7.06 JHSS will cooperate generally with the Fund to provide information
necessary for the preparation of registration statements and periodic reports to
be filed with the Securities and Exchange Commission, including registration
statements on Form N-1A, semi-annual reports on Form N-CSR, periodic statements,
shareholder communications and proxy materials furnished to holders of shares of
the Fund, filings with state "blue sky" authorities and with United States and
foreign agencies responsible for tax matters, and other reports and filings of
like nature.
7.07 In case of any requests or demands for the inspection of the Shareholder
records of the Fund, JHSS will endeavor to notify the Fund and to secure
instructions from an authorized officer of the Fund as to such inspection. JHSS
reserves the right, however, to exhibit the Shareholder records to any person
whenever it is advised by its counsel that it may be held liable for the failure
to exhibit the Shareholder records to such person.
Article 8 No Partnership or Joint Venture
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8.01 The Fund and JHSS are not currently partners of or joint venturers with
each other and nothing in this Agreement shall be construed so as to make them
partners or joint venturers or impose any liability as such on them.
Article 9 Termination of Agreement
------------------------
9.01 This Agreement may be terminated by either party upon one hundred twenty
(120) days' written notice to the other party.
9.02 Should the Fund exercise its right to terminate (a) JHSS will deliver to
the successor transfer agent all relevant books, records, correspondence and
other Fund records or data in the possession of JHSS and cooperate with the Fund
and any successor transfer agent or agents with respect to the transition of
services from JHSS to the successor transfer agent; (b) all out-of-pocket
expenses associated with the movement of records and material will be borne by
the Fund; and (c) JHSS reserves the right to charge for any other reasonable
expenses associated with such termination (including any expenses, fees and/or
penalties associated with JHSS's termination of a subcontract previously entered
into pursuant to the authority granted under this Agreement, which subcontract
would be terminated due to termination of the Agreement by the Fund; provided,
however, that any such expenses, fees and/or penalties arising from such
termination by JHSS of the subcontract were commercially reasonable).
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Article 10 Assignment and Sub-Contracting
------------------------------
10.01 Except as provided in Section 10.03 below, neither this Agreement nor any
rights or obligations hereunder may be assigned by either party without the
written consent of the other party.
10.02 This Agreement shall inure to the benefit of and be binding upon the
parties and their respective permitted successors and assigns.
10.03 Sub-Contracting. JHSS may subcontract for the performance hereof,
provided, however, that (a) upon engagement of any such subcontractor, and at
least annually thereafter, JHSS discloses to the Board the financial terms of
such subcontract and a summary of the services provided to the Fund pursuant to
such subcontract, and (b) JHSS shall be as fully responsible to the Fund for any
acts or omissions of any such subcontractor as JHSS is for its own acts and
omissions.
Article 11 Amendment
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11.01 This Agreement may be amended or modified by a written agreement executed
by both parties and authorized or approved by a resolution of the Trustees of
the Trust or Directors of the Corporation, as the case may be.
Article 12 Massachusetts Law to Apply
--------------------------
12.01 This Agreement shall be construed and the provisions thereof interpreted
under and in accordance with the internal substantive laws of The Commonwealth
of Massachusetts.
Article 13 Merger of Agreement
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13.01 This Agreement constitutes the entire agreement between the parties
hereto and supersedes any prior agreement with respect to the subject hereof
whether oral or written.
Article 14 Limitation on Liability
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14.01 If the Fund is a Massachusetts business trust, JHSS expressly
acknowledges the provision in the Fund's Declaration of Trust limiting the
personal liability of the trustees and shareholders of the Fund; and JHSS agrees
that it shall have recourse only to the assets of the Fund for the payment of
claims or obligations as between JHSS and the Fund arising out of this
Agreement, and JHSS shall not seek satisfaction of any such claim or obligation
from the trustees or shareholders of the Fund. In any case, each Fund, and each
series or portfolio of each Fund, shall be liable only for its own obligations
to JHSS under this Agreement and shall not be jointly or severally liable for
the obligations of any other Fund, series or portfolio hereunder.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in their names and on their behalf under their seals by and through
their duly authorized officers, as of the day and year first above written.
On Behalf of each Fund and Portfolio
Listed on Exhibit A)
By: /s/Xxxxx Xxxxxxxxx
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Xxxxx Xxxxxxxxx
President and CEO
XXXX XXXXXXX SIGNATURE SERVICES, INC.
By: /s/Xxxx Xxxxx
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Xxxx Xxxxx
President and CEO
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SCHEDULE 1
DUTIES OF JHSS
In addition to the services set forth in the Agreement, JHSS shall, in
accordance with the procedures that may be established from time to time between
JHSS and the Fund, perform the following services:
1. Shareholder Accounts. In connection with the establishment of Shareholder
accounts, JHSS shall:
(a) Receive new account applications and review such applications to ensure
completeness of information and establish and maintain proper Shareholder
registrations accordingly.
(b) To the extent incomplete or incorrect information is provided on such new
account applications attempt to contact and/or correspond with the new
Shareholder in an effort to complete or correct such information.
(c) Maintain those records required by applicable laws, rules and regulations
of governmental authorities having jurisdiction with respect to the duties
to be performed by JHSS hereunder with respect to Shareholder accounts or
by transfer agents generally, including records of the accounts for each
Shareholder showing the following information:
(i) Name, address and United States Taxpayer Identification or Social
Security number;
(ii) Number and class of Shares held and number and class of Shares for
which certificates, if any, have been issued, including certificate numbers
and denominations;
(iii) Historical information regarding the account of each Shareholder,
including dividends and distributions paid, their character (e.g., ordinary
income, net capital gain, exempt-interest, foreign tax-credit and dividends
received deduction eligible) for federal income tax purposes and the date
and price for all transactions on a Shareholder's account;
(iv) Any stop or restraining order placed against a Shareholder's account;
(v) Any correspondence relating to the current maintenance of a
Shareholder's account;
(vi) Information with respect to withholdings; and
(vii) Any information required in order for JHSS to perform any
calculations contemplated or required by this Agreement.
(d) Investigate all inquiries from Shareholders relating to Shareholder
accounts and respond to communications from Shareholders and others
relating to JHSS's duties hereunder and such other correspondence as may
from time to time be mutually agreed upon between JHSS and a Fund.
2. Purchase Orders. In connection with the purchase order for Shares JHSS
shall:
(a) Receive for acceptance, orders for the purchase of Shares, and promptly
deliver payment and appropriate documentation therefore to the Fund's
Custodian;
(b) Maintain and process letters of accumulation and automatic investment
plans;
1
(c) Pursuant to purchase orders, issue the appropriate number of Shares and
hold such Shares in the appropriate Shareholder account;
(d) In the event that any check or other order for the payment of money is
returned unpaid for any reason, JHSS will: (i) give prompt notice of such
return to the Fund; (ii) place a stop transfer order against all Shares
issued as a result of such check or order; and (iii) take such actions as
JHSS may from time to time deem appropriate.
(e) JHSS shall not be required to accept purchase orders or to issue any Shares
of the Fund when JHSS has received a Written Instruction from the Fund or
official notice from any appropriate authority that the sale of the Shares
of the Fund have been suspended or discontinued. The existence of such
Written Instructions or such official notice shall be conclusive evidence
of the right of JHSS or its agent to rely on such Written Instructions or
official notice.
3. Redemptions and Exchanges. JHSS shall process all requests to redeem and/or
exchange Shares of the Fund in accordance with the transfer or redemption
procedures set forth the Fund's Prospectus and as follows:
(a) JHSS shall receive for review and acceptance, redemption requests and
redemption directions and deliver the appropriate documentation therefore
to the Custodian;
(b) Process automatic redemptions from accounts for Shareholders that
participate in a systematic withdrawal plans;
(c) Process redemptions of Shares from accounts with checkwriting redemption
privileges in accordance with agreed-upon procedures;
(d) At the appropriate time as and when JHSS receives monies paid to it by the
Custodian with respect to any redemption, JHSS shall pay over or cause to
be paid over in the appropriate manner such monies as instructed by the
redeeming Shareholders;
(e) JHSS shall process exchanges of Shares by Shareholders upon receipt of
appropriate instructions;
(f) JHSS will redeem or exchange Shares upon receipt of proper Shareholder
instructions or otherwise pursuant to the Prospectus and Share
certificates, if any, properly endorsed for transfer or redemption,
accompanied by such documents as JHSS or its agent reasonably may deem
necessary.
(g) JHSS reserves the right to refuse to exchange or redeem Shares until it is
satisfied that the instructions for such request are valid and genuine.
JHSS also reserves the right to refuse to exchange or redeem Shares until
it is satisfied that the requested transfer or repurchase is legally
authorized, and it shall incur no liability for the refusal, in good faith,
to make transfers or repurchases which JHSS or its agent, in its good
judgment, deems improper or unauthorized, or until it is reasonably
satisfied that there is no basis to any claims adverse to such transfer or
repurchase.
(h) When Shares are redeemed, JHSS shall, upon receipt of the instructions and
documents in proper form, deliver to the Custodian and the Fund or its
designee a notification setting forth the number of Shares to be redeemed.
Such redeemed shares shall be reflected on appropriate accounts maintained
by JHSS or its agent reflecting outstanding Shares of the Fund and Shares
attributed to individual accounts.
2
4. Share Certificates. In connection with any certificates issued with respect
to Shares of the Fund JHSS shall:
(a) Issue replacement Shares, in uncertificated form, in lieu of certificates
which have been lost, stolen or destroyed, upon receipt by JHSS of properly
executed affidavits and lost certificate bonds, in form satisfactory to
JHSS, with the Fund and JHSS as obligees under the bond.
(b) Maintain a record of each certificate issued, the number of Shares
represented thereby and the holder of record.
(c) Report any certificates missing, lost, stolen, counterfeit or recovered to
the Security Information Center as required by Rule 17f-1 of the 34 Act.
5. Communications to Shareholders.
(a) JHSS will deliver to Shareholders of the Fund, as disclosed on JHSS's books
and records for the Fund:
(i) Reports to Shareholders (including annual and semi-annual reports) as
directed by the Fund;
(ii) Confirmations of purchases and sales of Fund shares as required,
including providing duplicate confirmations to broker-dealers of their
clients' activity, whether executed through the broker-dealer or directly
with JHSS;
(iii) Monthly or quarterly statements;
(iv) Dividend and distribution notices;
(v) Tax forms and notices (including substitute forms), accompanying
information containing the information required by Section 7 below and
applicable IRS regulations;
(vi) New account information;
(vii) Coordinate annual mailings of prospectuses and statements of
additional information as directed by the Fund;
(viii) Shareholder/information letters;
(ix) Retirement and XXX information (including tax information); and
(x) such other mailings and communications as the Fund requests.
(b) Call Center. JHSS shall maintain and operate a call center staffed with
properly trained customer liaison representatives and provide toll-free
telephone lines for direct Shareholder use.
(c) Voice Response Unit. JHSS shall operate and maintain a touch-tone based
interactive voice response application allowing Shareholders to perform
such tasks and functions as may be made available by JHSS and approved by
the Fund.
3
(d) Internet Access. JHSS shall operate and maintain appropriate links to the
world wide web to enable Shareholders to perform such tasks and functions
as may be made available by JHSS and approved by the Fund.
6. Dividends. In connection with dividend or other distributions declared by
the Fund:
(a) Upon the declaration of each dividend and each capital gains or other
distribution the Fund shall provide notice to JHSS setting forth the date
of the declaration of such dividend or distribution, the ex-dividend date,
the date of payment thereof, the record date as of which Shareholders
entitled to payment shall be determined, the amount payable per Share to
Shareholders of record as of that date, the total amount payable to JHSS on
the payment date and whether such dividend or distribution is to be paid in
Shares of such class at net asset value.
(b) On or before the payment date specified in the notice referenced in Section
6(a) above, the Fund will cause the Custodian to provide JHSS with
sufficient funds to make payment to the Shareholders of record as of such
payment date and JHSS will prepare and transmit payments to Shareholders
with respect to the dividend or distribution or process the reinvestment of
such distributions into Shareholder accounts at the net asset value per
share for the Fund next computed after the payment in accordance with the
Fund's then-current prospectus).
7. Taxes on Distributions. The payment or reinvestment of distributions and
payments or redemption proceeds, shall be made after deduction and payment of
the required amount of funds to be withheld in accordance with any applicable
state or federal tax law or other applicable laws, rules or regulations. JHSS
shall provide to each Shareholder and the IRS and other appropriate taxing
authorities such tax forms, or permissible substitute forms, and other
information relating to dividends and distributions paid by the Fund as are
required to be filed and mailed by applicable law, rule or regulation within the
time required thereby. JHSS shall prepare, maintain and file with the IRS and
other appropriate taxing authorities reports relating to all dividends and
distributions above a stipulated amount paid by the Fund to its Shareholders as
required by tax or other law, rule or regulation. In connection with the
foregoing, JHSS shall:
(a) Prepare and mail required calendar and taxable year-end tax and statement
information to Shareholder accounts disclosed on its books and records; and
(b) Perform withholding and remit to the IRS taxes for U.S. resident and
non-resident aliens, where applicable.
8. Lost Shareholders. JHSS shall perform such services as are required in
order to comply with Rule 17Ad-17 of the 1934 Act (the "Lost Shareholder Rules),
including, but not limited to those set forth below. JHSS may, in its sole
discretion, use the services of a third party to perform some or all of such
services.
(a) Documentation of electronic search policies and procedures;
(b) Execution of required searches;
(c) Creation and mailing of confirmation letters;
(d) Taking receipt of returned verification forms;
(e) Providing confirmed address corrections in batch via electronic media;
4
(f) Tracking results and maintaining data sufficient to comply with the Lost
Shareholder Rules; and
(g) Preparation and submission of data required under the Lost Shareholder
Rules.
9. Escheatment. JHSS shall prepare and submit appropriate reports with each
state in connection with the escheatment of shares and uncashed distribution
checks and escheat such Shares and funds to each state based on each states
respective unclaimed/abandoned property rules and provide to each Fund
escheatment reports as reasonably requested by a Fund with respect to the status
of the Fund's accounts and outstanding checks.
10. Commissions, 12b-1 and Other Payments. In connection with commissions,
12b-1 and other payments and in accordance with the procedures established
between JHSS and JHF, JHSS shall:
(a) Calculate and process payments to financial intermediaries, including
brokers, and financial intermediaries;
(b) Develop, monitor and maintain, in consultation with the Fund, all systems
necessary to implement and operate distribution systems, including Class B
conversion feature or similar conversion feature for other Classes, as
described in the registration statement and related documents of the Fund,
as they may be amended from time to time;
(c) Calculate contingent deferred sales charge amounts and redemption fees upon
redemption of Fund shares and deduct such amounts from redemption proceeds;
(d) Calculate front-end sales load amounts at time of purchase of shares;
(e) Determine dates of Class B or similar conversion and effect the same;
11. Retirement Plans. In connection with the individual retirement accounts,
simplified employee pension plans, rollover individual retirement plans,
educational IRAs and XXXX individual retirement accounts ("XXX Plans"), 403(b)
Plans and money purchase and profit sharing plans (collectively, the "Retirement
Plans") within the meaning of Section 408 of the Internal Revenue Code of 1986,
as amended (the "Code") sponsored by a Fund for which contributions of the
Fund's shareholders (the "Participants") are invested solely in Shares of the
Fund, JHSS shall provide the following administrative services:
(a) Establish a record of types and reasons for distributions (i.e., attainment
of eligible withdrawal age, disability, death, return of excess
contributions, etc.);
(b) Record method of distribution requested and/or made;
(c) Receive and process designation of beneficiary forms requests;
(d) Examine and process requests for direct transfers between
custodians/trustees, transfer and pay over to the successor assets in the
account and records pertaining thereto as requested;
(e) Prepare any annual reports or returns required to be prepared and/or filed
by a custodian of a Retirement Plan, including, but not limited to, an
annual fair market value report, Forms 1099R and 5498; and file same with
the IRS and provide same to Participant/Beneficiary, as applicable; and
5
(f) Perform applicable state and federal withholding and send
Participants/Beneficiaries applicable TEFRA notices regarding required
federal tax withholding.
12. Recording Issuance of Shares.
(a) JHSS shall record the issuance of Shares of the Fund and maintain pursuant
to Rule 17Ad-10(e) of the rules and regulations of the Securities Exchange
Act of 1934 a record of the total number of Shares of the Fund which are
authorized, based upon data provided to it by the Fund, and issued and
outstanding. JHSS shall also provide the Fund, on a regular basis, with the
total number of Shares which are authorized and issued and outstanding and
shall have no obligation, when recording the issuance of Shares, to monitor
the issuance of these Shares or to take cognizance of any laws relating to
the issue or sale of these Shares, which functions shall be the sole
responsibility of the Fund.
(b) In calculating the number of Shares to be issued on purchase or
reinvestment, or redeemed or repurchased, or the amount of the purchase
payment or redemption or repurchase payments owed, JHSS shall use the net
asset value per share (as described in the Fund's then-current prospectus)
computed by it or such other person as may be designated by the Fund's
Board. All issuances, redemptions or repurchases of the Funds' shares shall
be effected at the net asset values per share next computed after receipt
of the orders in good order and such orders shall become irrevocable as of
the time such values are next computed.
13. Proxies. JHSS shall, at the direction of the Fund, provide to the Fund's
proxy services vendor such Shareholder information and reports as requested to
assist such vendor with its provision of proxy services to the Fund.
14. In addition to and not in lieu of the services set forth in the above, JHSS
shall:
(a) Provide appropriate daily Blue Sky Reports to the Fund, or its designee to
enable the Fund, or such designee to monitor the total number of the Fund's
Shares sold in each State;
(b) Require proper forms of instructions, signatures and signature guarantees
and any necessary documents supporting the opening of Shareholder accounts,
transfers and redemptions and other Shareholder account transactions, all
in conformance with JHSS's present procedures with such changes or
deviations therefrom as may be from time to time required or approved by a
Fund, or the Fund's counsel or JHSS's counsel and the rejection of orders
or instructions not in good order in accordance with the applicable Fund
prospectus;
(c) Maintain a current, duplicate set of a Fund's essential records at a secure
separate location in a form available and usable forthwith in the event of
any breakdown or disaster disruption of JHSS's main operation;
(d) Provide periodic Shareholder lists, outstanding Share and Class
calculations and related statistics to the Fund as requested;
(e) Perform other participating broker-dealer or Shareholder services as may be
agreed upon from time to time; and
(f) Perform all of the customary services of a transfer agent and dividend
disbursing agent including but not limited to: maintaining all Shareholder
accounts, preparing Shareholder meeting lists, mailing proxies, receiving
and tabulating proxies, mailing Shareholder reports and prospectuses to
current Shareholders, withholding taxes on U.S. resident and non-resident
alien accounts, preparing and filing appropriate forms required with
6
respect to dividends and distributions by federal authorities for all
Shareholders, preparing and mailing confirmation forms and statements of
account to Shareholders for all purchases and redemptions of Shares and
other confirmable transactions in Shareholder accounts, preparing and
mailing activity statements for Shareholders, and providing Shareholder
account information.
7
SCHEDULE 1.1
ADDITIONAL SERVICES
1. Rule 22c-2 Services. In connection with its obligation set forth in Rule
22c-2 of the 40 Act and in accordance with the procedures established from time
to time between the Fund and JHSS, the Fund hereby engages JHSS to provide the
following services (the "Rule 22c-2 Services") and JHSS agrees to provide such
services:
(a) establish procedures and/or functionality necessary to request and obtain
from Financial Intermediaries (as defined by Rule 22c-2) the following
information ("Client-shareholder Information") regarding Shares held by
customers of such Financial Intermediaries ("Client-shareholders") on the
books and records of the Fund in nominee name:
(i) taxpayer identification number ("TIN"), Individual/International
Taxpayer Identification Number ("ITIN"), or other government-issued
identifier for each Client-shareholder, if known;
(ii) amount, date, name or other identifier of any investment
professional(s) associated with the Client-shareholder(s) or account, if
known; and
(iii) transaction type (purchase, redemption, transfer, or exchange) of
every purchase, redemption, transfer, or exchange of Shares by such
Client-shareholders.
(b) at such frequency as determined by JHSS and the Fund (which frequency may
be different for each Fund), request Client-shareholder Information from
Financial Intermediaries;
(c) review such Client-shareholder Information to ensure compliance with the
Funds' policies relating to excessive trading;
(d) upon identification of a Client-shareholder as having engaged in
transactions of Shares (directly or indirectly through the Financial
Intermediary account) that violate policies established by the Fund for the
purpose of eliminating or reducing any dilution of the value of the
outstanding Shares, JHSS shall (i) provide written instruction to the
applicable Financial Intermediary instructing the Financial Intermediary to
restrict or prohibit further purchases or exchanges of Shares by the
Client-shareholder; (ii) obtain written confirmation from the Financial
Intermediary of the Financial Intermediary's compliance with such
instructions; and (iii) provide periodic reporting to the Fund with respect
to any restrictions or prohibitions placed on Financial Intermediary or
Client-shareholder;
(e) engage the services of such third parties as may be reasonably necessary to
facilitate the provision of Rule 22c-2 Services by JHSS; and
(f) facilitate the payment of such fees and charges imposed by Financial
Intermediaries pursuant to shareholder information agreements between such
Financial Intermediaries and either (i) JHSS; or (ii) the Funds'
distributor, Xxxx Xxxxxxx Funds, LLC related to JHSS's request for
Client-shareholder Information and the transmission of such
Client-shareholder Information by the Financial Intermediary to JHSS
pursuant to such agreements.
(g) Excessive Trading. In accordance with the procedures established from time
to time between the Fund and JHSS, JHSS shall:
(i) monitor activity in shareholder accounts to ensure compliance with the
Funds' policies relating to excessive trading; and
1
(ii) take such action as required by such procedures with respect to any
shareholder deemed to be in violation of such policies prohibiting
excessive trading.
2
EXHIBIT A
LIST OF FUNDS and PORTFOLIOS
A. Retail Funds:
-------------
Equity Funds
Balanced Fund
Classic Value Fund
Classic Value Fund II
Core Equity Fund
Financial Industries Fund
Focused Equity Fund
Greater China Opportunities Fund
Growth Trends Fund
Health Sciences Fund
International Fund
International Classic Value Fund
Large Cap Equity Fund
Large Cap Select Fund
Mid Cap Equity Fund
Multi Cap Growth Fund
Real Estate Fund
Regional Bank Fund
Small Cap Fund
Sovereign Investors Fund
Technology Fund
Technology Leaders Fund
US Global Leaders Growth Fund
Income Funds
Bond Fund
Government Income Fund
High Income Fund
High Yield Fund
Investment Grade Bond Fund
Strategic Income Fund
Tax-Free Income Funds
California Tax-Free Income Fund
High Yield Municipal Bond Fund
Massachusetts Tax-Free Income Fund
Tax-Free Bond Fund
Money Market Funds
Money Market Fund
U.S. Government Cash Reserve Fund
1
B. Institutional Funds:
--------------------
Equity Funds
Balanced Fund
Classic Value Fund
Core Equity Fund
Diversified Core Equity Fund II
Greater China Opportunities Fund
International Fund
Large Cap Select Fund
Mid Cap Equity Fund
Small Cap Equity Fund
Small Cap Growth Fund
Small Cap Fund
Sovereign Investors Fund
US Global Leaders Growth Fund
Income Funds
Bond Fund
High Income Fund
Investment Grade Bond Fund
Strategic Income Fund
2
EXHIBIT B
TRANSFER AGENT FEE SCHEDULE
The transfer agent fees payable monthly under the Transfer Agency and Services
Agreement between each Fund and JHSS shall be the following rates plus certain
out-of-pocket expenses set forth in Exhibit C as described to the Board.
XXXX XXXXXXX EQUITY FUNDS:
---------------- -------------------------------- -----------------------------
Class Annual Per Account Fee Asset Based Fee
(% of daily net assets)
---------------- -------------------------------- -----------------------------
Class A Shares $15.00 0.05%
---------------- -------------------------------- -----------------------------
Class B Shares $17.50 0.05%
---------------- -------------------------------- -----------------------------
Class C Shares $16.50 0.05%
---------------- -------------------------------- -----------------------------
Class R Shares $15.00 0.05%
---------------- -------------------------------- -----------------------------
Class I Shares $15.00 0.04%
---------------- -------------------------------- -----------------------------
XXXX XXXXXXX INCOME FUNDS:
---------------- -------------------------------- -----------------------------
Class Annual Per Account Fee Asset Based Fee
(% of daily net assets)
---------------- -------------------------------- -----------------------------
Class A Shares $16.00 0.015%
---------------- -------------------------------- -----------------------------
Class B Shares $18.50 0.015%
---------------- -------------------------------- -----------------------------
Class C Shares $17.50 0.015%
---------------- -------------------------------- -----------------------------
Class R Shares $16.00 0.05%
---------------- -------------------------------- -----------------------------
Class I Shares $15.00 0.04%
---------------- -------------------------------- -----------------------------
XXXX XXXXXX TAX-FREE INCOME FUNDS:
---------------- -------------------------------- -----------------------------
Class Annual Per Account Fee Asset Based Fee
(% of daily net assets)
---------------- -------------------------------- -----------------------------
Class A Shares $16.00 0.010%
---------------- -------------------------------- -----------------------------
Class B Shares $18.50 0.010%
---------------- -------------------------------- -----------------------------
Class C Shares $17.50 0.010%
---------------- -------------------------------- -----------------------------
Class R Shares $16.00 0.010%
---------------- -------------------------------- -----------------------------
Class I Shares $15.00 0.04%
---------------- -------------------------------- -----------------------------
XXXX XXXXXXX MONEY MARKET FUNDS:
---------------- -------------------------------- -----------------------------
Class Annual Per Account Fee Asset Based Fee
(% of daily net assets)
---------------- -------------------------------- -----------------------------
Class A Shares $15.00 0.010%
---------------- -------------------------------- -----------------------------
Class B Shares $18.50 0.010%
---------------- -------------------------------- -----------------------------
Class C Shares $17.50 0.010%
---------------- -------------------------------- -----------------------------
Class R Shares N/A N/A
---------------- -------------------------------- -----------------------------
Class I Shares $15.00 0.04%
---------------- -------------------------------- -----------------------------
1
EXHIBIT B.1
ADDITIONAL SERVICE FEES
A. Rule 22c-2 Service Fees:
In consideration of the Rule 22c-2 Services provided by JHSS, the Funds shall
pay the following fees and charges which shall be billed by JHSS to the Fund
monthly in arrears until such time as the Fund and JHSS agree in writing to
modify the frequency of such billing:
1. FTE Expense. $120,000 per annum (2 FTE @ $45,000 x 1.33 each).
2. Reimbursement of fees and charges imposed by such third party service
providers required to be used by JHSS in order to provide the Rule 22c-2
Services.
3. Reimbursement for fees and charges imposed by Financial Intermediaries
pursuant to shareholder information agreements between such Financial
Intermediaries and either (a) JHSS; or (b) the Funds' distributor, Xxxx
Xxxxxxx Funds, LLC related to JHSS's request for Client-shareholder
Information and the transmission of such Client-shareholder Information by
the Financial Intermediary to JHSS pursuant to such agreements.
4. The parties acknowledge and agree that the fees set forth above are in the
aggregate with respect to all Xxxx Xxxxxxx Funds for which JHSS provides
the Rule 22c-2 Services under this Agreement as well as the Transfer Agency
and Service Agreements in effect between (a) JHSS and Xxxx Xxxxxxx Funds
II; and (b) JHSS and Xxxx Xxxxxxx Funds III.
5. In as much as the fees set forth in this Appendix A.1 are related to
non-transfer agent services, the parties acknowledge and agree (a) JHSS
shall invoice the Fund separately for the Rule 22c-2 Services; and (b) the
fees for such services shall not apply with respect to any cap on transfer
agent fees or out-of-pocket expenses otherwise agreed to by JHSS and the
Fund.
1
EXHIBIT C
Out-of-Pocket Fees (OOP)
A. DST Base Fees
-------------
-------------- ----------------------------------------------------- -------------- ------------------------------------------------
Acct. Title General Description Funds Allocation Methodology
-------------- ----------------------------------------------------- -------------- ------------------------------------------------
DST Base Fee DST complex base charge for utilization of TA2000 Allocated by fund by number of open billable
system accounts.
Retail,
Retirement & Annual Charge of $378,000.00.
Institutional Effective 6/1/05: Annual Charge of $500,000.00.
(Do not xxxx to Stable Value Trust Fund)
-------------- ----------------------------------------------------- -------------- ------------------------------------------------
DST Closed Represents DST expense associated with maintaining Retail, Allocated by fund by number of closed accounts.
Accounts closed accounts on recordkeeping system. Retirement &
Institutional Annual Charge of $1.58 per account.
Effective 6/1/05: Annual Charge of $1.45 per
account.
Effective 9/1/05: Annual Charge of $1.00 per
account.
Fund 301(CIT) - DST Closed account fee is
allocated to 5327-4805000. Glemis entry: Debit
5327-4805, Credit 0990-4702.
(Xxxx to Stable Value Trust Fund)
-------------- ----------------------------------------------------- -------------- ------------------------------------------------
DST CDSC Represents DST expense, in addition to open account Retail, Allocated by fund by number of open billable
Charges fee, for tracking and reporting associated with Class B & C Class B and C accounts.
Class B and C accounts (i.e. Sharelot facility). Only
Annual Charge of $1.89 per account.
Effective 6/1/05: Annual Charge of $1.75 per
account.
Effective 9/1/05: Annual Charge of $1.20 per
account.
(Xxxx to Stable Value Trust Fund)
-------------- ----------------------------------------------------- -------------- ------------------------------------------------
B. Out-of-Pocket Expenses (OOP)
----------------------------
-------------- ----------------------------------------------------- -------------- ------------------------------------------------
Acct. Title General Description Funds Allocation Methodology
-------------- ----------------------------------------------------- -------------- ------------------------------------------------
-------------- ----------------------------------------------------- -------------- ------------------------------------------------
Confirms and >> Category represents the production and Retail & >> In general, customer output expenses are
Statements mailing of JHF customer output including base Institutional allocated by fund by number of open billable
stock, postage, printing and mailing of accounts (Retail and Institutional Only). If
confirms, statements including daily fund specific, the total expense will be
redemption and replacement checks. allocated to the applicable fund(s) only.
Majority of expenses, checks, confirms,
postage should be allocated to retail funds
only. All TRAC expenses should be allocated
to retail funds only. Allocate only JHF
applications/jobs to Institutional Funds.
>> DST Output Informa is allocated by fund
by number of open billable accounts (Retail
only).
DST Output and PFPC Invoices Only:
Effective 2005 - use DST open billable Matrix
Level 0 (zero) and 4 report to allocate expenses.
(Do not xxxx to Stable Value Trust Fund)
-------------- ----------------------------------------------------- -------------- ------------------------------------------------
Tax Forms Category represents the production and mailing of Retail & Xxxxx Xxxxxxx invoices (monthly) - allocated by
original (Xxxxx/OT) and duplicate (OT) tax forms Institutional fund by number of open billable accounts (Retail
including base stock, print costs and postage. Only).
Xxxxx Xxxxxxx invoices - allocated to the
applicable funds generated by the tax form jobs,
fund specific.
Xxxxx Xxxxxxx advanced postage invoices -
allocated by fund by number of open billable
accounts in Matrix Level 0 and 4 (Retail Only).
Convey invoice (tax software) -allocated by fund
by number of open billable accounts (Retail
Only)
DST Output - Infodisc (yearend) CD line and
duplicate disc. Allocated by fund by number of
open billable accounts (Retail and Institutional
Only).
(Do not xxxx to Stable Value Trust Fund)
-------------- ----------------------------------------------------- -------------- ------------------------------------------------
1
-------------- ----------------------------------------------------- -------------- ------------------------------------------------
DST/PFPC Represents the DST charge to transmit data to PFPC. Retail Allocated by fund by number of open billable
Trans-mission accounts (Retail Only).
Costs
(Do not xxxx to Stable Value Trust Fund)
-------------- ----------------------------------------------------- -------------- ------------------------------------------------
Compliance Represents fees associated with the following Retail, Lost Shareholder Search/Tracking: Allocated by
Products products: Retirement & fund by number of open billable accounts.
>> DST Lost Shareholder Search - A Xxxxxxx Institutional
>> DST Lost Shareholder Tracking - A Xxxxxxx Identity Check: Allocated by fund by number of
>> DST Identity Check (11/24/03 Formerly - open billable accounts.
Early Warning New Account) - K Xxxxxxx
Effective 7/1/05: Identity Check rates are Short Term Trader: Allocated to all retail funds
$.16 per record except funds 43, 44, 144, 544, 62, 162, 562 and
>> DST Short Term Trader - M Xxxxxxxxx any development funds
Effective 6/1/05: Annual Charge of $.06 per
account. Trans Union: Allocated by fund by number of open
>> Trans Union - X Xxxxx billable accounts.
(Do not xxxx to Stable Value Trust Fund)
-------------- ----------------------------------------------------- -------------- ------------------------------------------------
DST Internet Category represents all DST Internet Products Retail & >> FAN is allocated by fund by number of
including: Institutional open billable accounts (Retail &
>> FAN: Shareholder access to DST via Institutional Only)
Internet for account history, portfolio value
and transaction processing.(DST) - X. Xxxxx >> Vision is allocated by fund by number of
>> Vision: Broker/Representative access to open billable accounts (Retail &
DST via Internet for account history, Institutional Only)
portfolio value and transaction processing -
X. Xxxx >> TRAC Internet is allocated by fund by
number of open billable PPA (participant)
Vision Pricing Model accounts (Retail Only) - Product shut off
1/1/2005
New Dial-Up & Dedicated Circuit IDs
---------------------------------------------------- >> E-delivery is allocated by number of open
From: 1 To: 500 $5.00/mo accounts (Retail Only)
From: 501 To: 1,000 $4.00/mo
From: 1,001 To: 2,000 $3.00/mo (Do not xxxx to Stable Value Trust Fund)
From: 2,001 To: 3,000 $2.00/mo
From: 3,001 To: $0.00/mo***
----------------------------------------------------
***JH exceeds the 3,001 ID threshold. Therefore,
we are not billed for IDs each month.
----------------------------------------------------
Per View Fee $0.05
Per Transaction Fee $0.25
Per NASU Fee $3.00 (JH does not offer
NASUs via VISION)
Monthly Minimum Charge $500.00
----------------------------------------------------
DST charges JH a flat rate of $9,500.00 each month
for using VISION.
>> TRAC Internet: Participant access to DST
via Internet for account history, portfolio
value and transaction processing. (DST) - N/A
>> E-delivery: Delivery of quarterly
statements electronically. (Informa) -
Xxxxxxxxx
-------------- ----------------------------------------------------- -------------- ------------------------------------------------
Bank Retail &
Processing Institutional Effective 6/1/2004, Bank of New York will provide
Fees assessed by banks for processing and NSCC Same Day Fund Settlement service for JHF (JH
reconciliation of transfer agent DDA's. Open Ended Mutual Funds will be effected). This
service will be billed monthly by BONY
(annualized cost $12,110).
Any interest/investment earnings and/or balance
credits ("Service Account Earnings") earned by JHSS Allocated by open billable accounts that are NSCC
with respect to the funds in such Service Accounts eligible, EXCEPT Class R.
will be used to offset (a) the banking service
fees; and (b) transfer agent fees and out-of-pocket Effective 10/1/2005, allocated by open billable
expenses owed by the Fund. accounts that are NSCC eligible, EXCEPT Class R,
R3, R4 and R5.
(Xxxx to Stable Value Trust Fund)
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2
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Check-writing Represents expenses associated with the productions Retail, Allocated by fund (only funds that offer
and mailing, including base stock and postage, of Class A Only checkwriting privilege) by # of open billable
checkwriting checkbooks by Xxxx Xxxxxxx accounts coded for checkwriting. As of 2/1/2006,
the following funds offer checkwriting:
---------------------------------------
Fund # Fund Name
---------------------------------------
43 US Government Cash Reserve
44 Money Market
---------------------------------------
(Do not xxxx to Stable Value Trust Fund)
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Non-DST Represents Fund/SERV and networking fees charged by Retail, Allocated by fund by number of open billable
National National Securities Clearing Corporation (NSCC). Retirement & accounts that are NSCC eligible (excludes
Securities Institutional institutional funds that are not NSCC eligible).
Clearing
Corporation (Xxxx to Stable Value Trust Fund)
(NSCC)
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Misc. Includes one time fees/credits which are not Retail, Allocated as expense dictates
applicable to an existing OOP category. If the fee Retirement &
is recurring, a separate category may be Institutional (Do not xxxx to Stable Value Trust Fund)
established.
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800 Line Represents telephone usage and related expenses Retail & Allocated by 800 # by fund number of open xxxx-
Charges assessed by AT&T and DST including automated voice Institutional able accounts (Retail and Institutional Only):
response.
Retail:
------------------------------------------------
000-000-0000 000-000-0000 000-000-0000 X000
000-000-0000 000-000-0000 000-000-0000
000-000-0000 000-000-0000 000-000-0000
000-000-0000 000-000-0000 000-000-0000
000-000-0000 000-000-0000 000-000-0000
000-000-0000 000-000-0000 000-000-0000
000-000-0000 000-000-0000 000-000-0000
000-000-0000 000-000-0000
------------------------------------------------
Institutional:
------------------------------------------------
000-000-0000 000-000-0000
------------------------------------------------
(Do not xxxx to Stable Value Trust Fund)
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TRAC 2000 Represents programming expenses associated with DST Retail & Allocated by fund by number of open billable PPA
Dedicated TRAC development initiatives. Institutional (participant) accounts
Programmer
o Dedicated Programmer (Do not xxxx to Stable Value Trust Fund)
o Programming - Internet (new item -
effective date 12/15/03)
o Programmer - Internet
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DST Remote Represents the fee assessed by DST for maintaining Retail Allocated by fund by number of open billable
Asset Asset Allocation groups on TA2000. accounts (Retail Only).
Allocation
Effective 6/1/05: Annual Charge of $1.80 per
account.
Primary contact: Xxxxxx Xxxxxxxxxx.
(Do not xxxx to Stable Value Trust Fund)
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Program-ming / Represents programming expenses assessed by non-DST Retail, Allocated by fund by number of open billable
Develop-ment 3rd party business partners. DST Output, PFPC, Retirement & accounts (Retail & Institutional Only), unless
Informa programming falls into this category. Institutional expense is specific to fund.
DST Output Invoice Only:
Effective 2005 - use DST open billable Matrix
Level 0 (zero) and 4 report to allocate expense.
(Do not xxxx to Stable Value Trust Fund)
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3
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DST Represents charges associated with using Retail, Allocated by fund by number of open billable
PowerSelect PowerSelect which is a PC-based ad hoc reporting Retirement & accounts.
tool that provides the ability to run queries on Institutional
shareholder account and transaction data to Fund 301(CIT) - DST Powerselect fee ($180) is
generate reports, labels, and other output, allocated to 5327-4805000. Glemis entry: Debit
including magnetic media. 5327-4805, Credit 0990-4702.
Effective 7/31/06 -Cost center 5327 is no longer
charged a Powerselect fee for Fund 301 (CIT).
(Do not xxxx to Stable Value Trust Fund)
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TRAC Represents charges for funded and non-funded Retail & Participant Fees and Outside Investment Vehicle
Participant participant positions maintained on DST TRAC2000. Institutional Fees should be allocated by number of open
Fees billable PPA accounts.
o Participant Fees
o Outside Investment Vehicles Non-Funded Participant Fees should be allocated
o Participant without Money Fees for SIMPLE, by fund by number of closed PPA (participant)
403b and 401k accounts.
Effective 1/1/06:
Participant Fees: Delta Western Participant Fees
need to be separated out and allocated to
5299-598773. The remainder is to be allocated
to 598240 by number of open PPA accounts.
Non-Funded Participant Fees should be allocated
by fund by number of closed PPA accounts. If the
closed PPA accounts are unavailable, allocate by
number of open PPA accounts.
(Do not xxxx to Stable Value Trust Fund)
-------------- ----------------------------------------------------- -------------- ------------------------------------------------
DST Represents programming expenses associated with DST Retail, Allocated by fund by number of open billable
Program-ming development initiatives. Retirement & accounts.
Institutional
(Do not xxxx to Stable Value Trust Fund)
-------------- ----------------------------------------------------- -------------- ------------------------------------------------
DST Data Technology costs associated with maintaining remote Retail, Allocated by fund by number of open billable
Communica-tion access to DST Retirement & accounts.
Institutional
82.01% is Fund Billable, 17.99% gets booked to
XXX.
Effective 1/1/2005: Monthly NQR connection fee
will be billed to JHSS (5299-4758)
Effective 12/15/2006: No longer charged 17.99%
of the total Data Communication fee to XXX.
(Do not xxxx to Stable Value Trust Fund)
-------------- ----------------------------------------------------- -------------- ------------------------------------------------
DST Comp/Recon Additional cost assessed by DST for the use of the Retail, Allocated by fund by number of open billable
Comp/Recon subsystem. JHSS Control Department uses Retirement & accounts.
this system for automated reconciliation. Institutional
Cost $6,300 per month (flat fee)
(Do not xxxx to Stable Value Trust Fund)
-------------- ----------------------------------------------------- -------------- ------------------------------------------------
DST National Per fund fee assessed by DST for processing through Retail, Allocated by fund by number of open billable
Securities the NSCC ($131 per cusip per month) Retirement & accounts that are NSCC eligible.
Clearing Institutional
Corporation As of 1/1/2003 all Class I fees will be picked
(NSCC) up by JHSS.
As of 10/24/03 per X. Xxxxxxxxx and Xxxx Xxxxx:
Allocate ALL Class R to cost center
5306-4403000.
As of 7/25/05 per X. Xxxxxxxxx and Xxxx Xxxxx:
All Class R costs are being allocated through
OOP.
Effective 11/1/06: All Lifecycle Class R - R5
networking fees are allocated to 2294-581100
(Xxxx to Stable Value Trust Fund)
-------------- ----------------------------------------------------- -------------- ------------------------------------------------
DST Audio Expenses associated with utilizing DST's automated Retail & Allocated by fund by number of open billable
Response voice response products (DST OOP- Advanced, Institutional accounts (Retail & Institutional Only).
Transfer Connect, Inbound Long Distance).
Retail:
Charge is assessed at $.048 annually for each 1-800-338-8080
account with an Audio Response flag and $105 per 0-000-000-0000
month per fund family. 0-000-000-0000
-------------- ----------------------------------------------------- -------------- ------------------------------------------------
4
-------------- ----------------------------------------------------- -------------- ------------------------------------------------
0-000-000-0000
0-000-000-0000
0-000-000-0000
Institutional:
0-000-000-0000
(Do not xxxx to Stable Value Trust Fund)
-------------- ----------------------------------------------------- -------------- ------------------------------------------------
DST Computer Production and mailing of tapes (i.e. dealer Retail, Allocated by fund by number of open billable
Tapes tapes/cartridges, tax reporting/forms, proxies, Retirement & accounts.
etc.) Institutional
(Do not xxxx to Stable Value Trust Fund)
-------------- ----------------------------------------------------- -------------- ------------------------------------------------
DST Express Charges associated with air delivery of tapes, Retail, Allocated by fund by number of open billable
Mail cartridges, etc. Retirement & accounts.
Institutional
(Do not xxxx to Stable Value Trust Fund)
-------------- ----------------------------------------------------- -------------- ------------------------------------------------
DST Microfiche Represents the production and delivery, including Retail, Allocated by fund by number of open billable
base stock of microfilm/fiche reports and Retirement & accounts.
statements by non-DST 3rd parties. Institutional
(Do not xxxx to Stable Value Trust Fund)
-------------- ----------------------------------------------------- -------------- ------------------------------------------------
DST Disaster Represents fee associated with subscribing to DST Retail, Allocated by fund by number of open billable
Recovery disaster recovery program. Retirement & accounts.
Institutional
Annual Charge of $0.20 per account (Do not xxxx to Stable Value Trust Fund)
-------------- ----------------------------------------------------- -------------- ------------------------------------------------
Other Monthly credit representing interest earned in Retail, Allocated by fund by number of open billable
Reimburse- DDA's for JHF Retirement & accounts.
ments Institutional
(Do not xxxx to Stable Value Trust Fund)
-------------- ----------------------------------------------------- -------------- ------------------------------------------------
* * The Institutional Portion of the TA Base and OOP Fees are waived and allocated to JHSS
C. Non-JHSS Transfer Agent OOP Fees
--------------------------------
-------------- ----------------------------------------------------- -------------- ------------------------------------------------
Acct. Title General Description Funds Allocation Methodology
-------------- ----------------------------------------------------- -------------- ------------------------------------------------
Omnibus Fees Represents sub-transfer agent sub accounting fees Retail Allocated to specific funds by number of
assessed by various Dealers for participant participants participating in omnibus positions.
servicing fees within the omnibus positions.
Specific allocation provided monthly by Dealer
Support.
Citigroup Xxxxx Xxxxxx - Xxxxxx code E0 (E-
zero)
Prudential Array - Xxxxxx code D9
(Do not xxxx to Stable Value Trust Fund)
-------------- ----------------------------------------------------- -------------- ------------------------------------------------
National Represents Xxxxxxx Xxxxxx mutual fund service fees Retail & Allocated to specific funds participating in
Accounts Institutional Xxxxxxx Xxxxxx platform.
Specific allocation provided monthly by Xxxxxxx
Xxxxxx.
(Do not xxxx to Stable Value Trust Fund)
-------------- ----------------------------------------------------- -------------- ------------------------------------------------
Xxxxxxx Xxxxx Represents sub-accounting fees assessed by Merrill Retail Allocated by fund and by number of Merrill
Networked Xxxxx Xxxxx
Accounts Sub accounts.
(Do not xxxx to Stable Value Trust Fund)
Effective 1/1/2004 Corporate has decided going
forward that it will pick part of the Xxxxxxx
Xxxxx servicing fees. Corporate will pick up
the 20 bps that Xxxxxxx Xxxxx charges on its
Institutional retirement platform for servicing
fees.
Corporate has also decided to make this retro
active to Jan 1, 2004.
Effective date 9/2004, the 20 bps asset payment
to ML is billed directly to the account:
Cc 5316, G/L 4426000, by element number
Effective 3/2005, sub accounting fees for all
class I funds from Xxxxxxx Xxxxx'x retail
business is manually allocated to the account:
CC 5316, G/L 4411000
-------------- ----------------------------------------------------- -------------- ------------------------------------------------
5
-------------- ----------------------------------------------------- -------------- ------------------------------------------------
Participant Represents Institutional Investment Only (IIO) Retail Allocated to specific funds participating in
Servicing Fees participant servicing fees assessed for IIO arrangements.
participation in various platforms. The
relationships are maintained by: Xxxx Xxxxx, Dick (Do not xxxx to Stable Value Trust Fund)
Xxxxx, Xxxx Xxxxxx, Xxxx Xxxxxx and Xxxxx Xxxx.
* * The Institutional Portion of the Non-JHSS Transfer Agent OOP Fees are waived
and allocated to JHF
6
