SERVICE AGREEMENT
AGREEMENT made as of the 11th day of June, 1973, by and
between SEQUOIA FUND, INC., a Delaware corporation, having its
principal office and place of business at Xxx Xxx Xxxx Xxxxx, Xxx
Xxxx, Xxx Xxxx 00000, (the "Fund"), and DATA-SYS-TANCE, INC., a
Delaware corporation, having its principal office and place of
business at Kansas City, Missouri, ("DST").
WHEREAS, the 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:
Section 1. Terms of Appointment.
1.01 Subject to the conditions set forth in this
Agreement, the Fund hereby employs and appoints DST as Transfer
Agent and Dividend Disbursing Agent effective July 1, 1973,
1.02 DST hereby accepts such employment and appointment
and agrees that on and after the effective date of its
appointment it will act as the Fund's Transfer Agent and Dividend
Disbursing Agent. DST agrees that it will also act as agent in
connection with any periodic investment plan, periodic withdrawal
program or other accumulation, open-account or similar plans for
the Fund's shareholders.
1.03 DST agrees to provide the necessary facilities,
equipment and personnel to perform its duties and obligations
hereunder in accordance with industry practice.
1.04 The Fund agrees to use its best efforts to deliver
to DST in Kansas City, Missouri, on or before July 1, 1973, all
of its existing shareholder and account records or such thereof
as DST deems necessary to perform its duties hereunder and upon
the correctness of which DST is entitled to rely in its said
performance as required by this Agreement.
1.05 DST agrees that it will perform all of the usual
and ordinary services as Transfer Agent and Dividend Disbursing
Agent and as agent for the various shareholder accounts including
but not limited to: Issuing, transferring and cancelling stock
certificates, maintaining all shareholder accounts, preparing
annual shareholder meeting lists, mailing proxies, receiving and
tabulating proxies, mailing shareholder reports and prospectuses,
withholding taxes on non-resident alien accounts, disbursing
income dividends and capital gains distributions, preparing and
filing U.S. Treasury Department Form 1099 for all shareholders,
preparing and mailing confirmation forms to shareholders for all
purchases and liquidations of Fund shares and other confirmable
transactions in shareholders accounts, recording reinvestment of
dividends and distributions in Fund shares, causing liquidation
of shares and causing disbursements to be made to withdrawal plan
holders.
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Section 2. Fees and Expenses.
2.01 DST agrees to perform all of the services
necessary to convert the shareholder records of the Fund from the
Fund's present system to DST's system in Kansas City, Missouri.
For such services, the Fund agrees to reimburse DST for out-of-
pocket expenses incurred with the approval of the Fund.
2.02 For the services to be rendered by DST pursuant to
paragraph 1.05, the Fund agrees to pay DST an annual maintenance
fee for each shareholder account. The annual maintenance fee
shall be $6.50 per shareholder account subject to a $10,000
annual minimum charge, one-twelfth of which is payable an the
first day of each month. Each monthly payment shall be
calculated by multiplying one-twelfth of the annual maintenance
fee by the highest number of open shareholder accounts existing
at any time during the previous month or one-twelfth of the
annual minimum charge, whichever is greater.
2.03 The Fund agrees to promptly reimburse DST for all
reasonable out-of-pocket expenses or advances incurred by DST in
connection with the performance of services under this Agreement
including, but not limited to, expenditures for counsel fees,
postage, envelopes, checks, continuous forms, reports and
statements, telephone, telegraph, stationery, supplies, costs of
outside mailing firms, record storage costs and media for storage
of records (e.g. microfilm, computer tapes). In addition, any
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other expense incurred by DST at the request or with the consent
of the Fund will be promptly reimbursed by the Fund.
Section 3. Representations and Warranties of DST.
DST represents and warrants to the Fund that:
3.01 It is a corporation duly organized and existing
and in good standing under the laws of the State of Delaware;
3.02 It is duly qualified to carry on its business in
the State of Missouri;
3.03 It is empowered under applicable laws and by its
charter By-laws to enter into and perform the services
contemplated in this Agreement;
3.04 All requisite corporate proceedings have been
taken to authorize it to enter into and perform this Agreement;
and
3.05 It has and will continue to have and maintain the
necessary facilities, equipment and personnel to perform its
duties and obligations under this Agreement.
Section 4. Representations and Warranties of the Fund.
The Fund represents and warrants to DST that;
4.01 It is a corporation duly organized and existing
and in good standing under the laws of the State of Delaware;
4.02 It is an open-end non-diversified management
investment company registered under the Investment Company Act of
1940;
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4.03 A registration statement under the Securities Act
of 1933 is currently effective with respect to all shares of the
Fund being offered for sale;
4.04 The Fund is empowered under the applicable laws
and regulations and by its charter and By-laws to enter into and
perform this Agreement; and all requisite corporate proceedings
have been taken to authorize it to enter into and perform this
Agreement.
Section 5. Indemnification.
5.01 DST shall not be responsible and the Fund shall
indemnify and hold DST harmless from and against any and all
losses, damages, costs, charges, counsel fees, payments, expenses
and liability arising out of or attributable to:
(a) All actions of DST required to be taken by
DST pursuant to this Agreement provided that DST has
acted in good faith and with due diligence.
(b) The reliance on, or use by DST of information
furnished or of records and documents received by DST
which have been prepared and/or maintained by the Fund,
or any other person or firm on behalf of the Fund.
(c) Defaults by dealers with respect to payment
for share orders previously entered.
(d) The reliance on, or the carrying out of, any
instructions or requests of the Fund.
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(e) The offer or sale of the Fund's shares in
violation of any requirement under the securities laws
or regulations of any state that such shares be
registered in such state or in violation of any stop
order or other determination or ruling by any 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 the Fund or of
any officer or the Fund that no offers or sales be made
in or to residents of such state).
5.02 DST shall indemnify and bold the 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 which
arise out of DST's gross negligence or willful misconduct.
5.03 At any time DST may apply to any officer of the
Fund for instructions, and may consult with legal counsel for the
Fund or its own legal counsel, at the expense of the Fund, with
respect to any matter arising in connection with the services to
be performed by DST under this Agreement and DST shall not be
liable and shall be indemnified by the Fund for any action taken
or omitted by it in good faith in reliance upon such instructions
or upon the opinion of such counsel. DST shall be protected and
indemnified in acting upon any paper or document believed by it
to be genuine and to have been signed by the proper person or
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persons 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. DST shall also be protected and indemnified in
recognizing stock certificates which DST reasonably believes to
bear the proper manual or facsimile signatures of the officers of
the Fund, and the proper counter-signature of any former transfer
agent or registrar, or of a co-transfer agent or co-registrar.
Section 6. Covenants of DST and the Fund.
6.01 The Fund shall promptly furnish to DST the
following:
(a) A certified copy of the resolution of the
Board of Directors of the Fund authorizing the
appointment of DST and the execution and delivery of
this Agreement.
(b) Certified copy of the Articles of
Incorporation and By-laws of the Fund and all amendments
thereto.
(c) Specimens of all forms of outstanding stock
certificates in the form approved by the Fund's Board of
Directors with a certificate of the Secretary of the
Fund as to such approval.
6.02 DST hereby agrees to establish and maintain
facilities and procedures reasonably acceptable to the Fund for
safekeeping of stock certificates, check forms, and facsimile
signature imprinting devices, if any; and for the preparation or
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use, and for keeping account of such certificates, forms and
devices.
6.03 To the extent required by Section 31 of the
Investment Company Act of 1940 and Rules thereunder, DST agrees
that all records maintained by DST relating to the services to be
performed by DST under this Agreement are the property of the
Fund and will be preserved and will be surrendered promptly to
the Fund on request.
6.04 DST 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
of and the carrying out of this Agreement shall remain
confidential, and shall not be voluntarily disclosed to any other
person.
Section 7. Termination of Agreement.
7.01 This Agreement may be terminated by either party
by three months written notice to the other.
Section 8. Assignment.
8.01 Neither this Agreement nor any rights or
obligations hereunder may be assigned by DST without the written
consent of the Fund.
8.02 This Agreement shall inure to the benefit of and
be binding upon the parties and their respective successors and
assigns.
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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 corporate seals by and through their duly authorized
officers, as of the day and year first above written.
SEQUOIA FUND, INC.
By /s/ Xxxxxxx X. Xxxxxxx
___________________________
Xxxxxxx Xxxxxxx
President
ATTEST
/s/
_____________________________
Secretary
DATA-SYS-TANCE, INC.
By /s/ Xxxxxx X. XxXxxxxxx
___________________________
President
ATTEST:
/s/
_____________________________
Secretary
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69900020.AX8
DST SYSTEMS, INC.
TRANSFER AGENCY FEE SCHEDULE
SEQUOIA, INC.
*Mainframe Programming:
Dedicated Resource:
Mainframe Programmer - $115,000 per
year
Client Services Technical Support -
$70,500 per year
IWSI(TM)/AWD(R)1 Programming -
$140,000 per year
On-Request:
Mainframe Programmer - $80 per hour
Client Services Technical Support -
$60 per hour
IWS/AWD Programming - $105 per hour
Average Cost System:
$5,215 per year of history converted
$.27 per account per year
*Business Analysis:
Senior Staff Support - $55 per h(w
Staff Support - $35 per hour
Clerical Support - $25 per hour
*Audio Response(TM) System - see Exhibit A
Escheatment Costs - as incurred
Acquisition/Conversion Costs - Out of pocket expenses
including but not limited to travel and accommodations,
programming, training, equipment installation, etc.
____________________
1. AWD(R) is a registered trademark of DST Systems, Inc.
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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 forms,
postage, mailing services, telephone line/long distance charges,
remote client hardware, disaster recovery, proxy processing,
magnetic tapes, printing, microfilm/microfiche, ACH bank charges,
NSCC charges, etc. 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% per month until payment is received.
C. The above fees, except for phone calls and those
indicated by an "*", are guaranteed for a one year period, and
are subject to an annual increase in an amount not less than the
annual percentage change in the Consumer Price Index (CPI) of the
Kansas City Metropolitan Area. All changes to the fee schedule
will be communicated in writing at least 60 days prior to their
effective date. Those items which have been marked by an "*" are
established by other entities and therefore are subject to change
with a 60 day notice and cannot be guaranteed for a one year
period.
Fees Accepted By:
/s/ Xxxxxx X. Xxxxx /s/ Xxxxxx Xxxxxxxx, Xx.
DST Systems, Inc.
Sequoia Fund, Inc.
9/22/97 9/9/97
Date Date
69900020.AX8
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