TRANSFER AGENCY AGREEMENT
AGREEMENT dated as of May 10, 2001 between AXP Investment Series, Inc., a
Minnesota corporation, (the "Company" or "Fund") on behalf of its underlying
series AXP Diversified Equity Income Fund and AXP Mutual, and American Express
Client Service Corporation (the "Transfer Agent"), a Minnesota corporation.
In consideration of the mutual promises set forth below, the Company and the
Transfer Agent agree as follows:
1. Appointment of the Transfer Agent. The Company hereby appoints the Transfer
Agent, as transfer agent for its shares and as shareholder servicing agent
for the Company, and the Transfer Agent accepts such appointment and agrees
to perform the duties set forth below.
2. Compensation. The Company will compensate the Transfer Agent for the
performance of its obligations as set forth in Schedule A. Schedule A does
not include out-of-pocket disbursements of the Transfer Agent for which the
Transfer Agent shall be entitled to xxxx the Company separately.
The Transfer Agent will xxxx the Company monthly. The fee provided for
hereunder shall be paid in cash by the Company to the Transfer Agent within
five (5) business days after the last day of each month.
Out-of-pocket disbursements shall include, but shall not be limited to, the
items specified in Schedule B. Reimbursement by the Company for expenses
incurred by the Transfer Agent in any month shall be made as soon as
practicable after the receipt of an itemized xxxx from the Transfer Agent.
Any compensation jointly agreed to hereunder may be adjusted from time to
time by attaching to this Agreement a revised Schedule A, dated and signed
by an officer of each party.
3. Documents. The Company will furnish from time to time such certificates,
documents or opinions as the Transfer Agent deems to be appropriate or
necessary for the proper performance of its duties.
4. Representations of the Company and the Transfer Agent.
(a) The Company represents to the Transfer Agent that all outstanding
shares are validly issued, fully paid and non-assessable by the
Company. When shares are hereafter issued in accordance with the terms
of the Company's Articles of Incorporation and its By-laws, such
shares shall be validly issued, fully paid and non-assessable by the
Company.
(b) The Transfer Agent represents that it is registered under Section
17A(c) of the Securities Exchange Act of 1934. The Transfer Agent
agrees to maintain the necessary facilities, equipment and personnel
to perform its duties and obligations under this agreement and to
comply with all applicable laws.
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5. Duties of the Transfer Agent. The Transfer Agent shall be responsible,
separately and through its subsidiaries or affiliates, for the following
functions:
(a) Sale of Fund Shares.
(1) On receipt of an application and payment, wired instructions and
payment, or payment identified as being for the account of a
shareholder, the Transfer Agent will deposit the payment, prepare
and present the necessary report to the Custodian and record the
purchase of shares in a timely fashion in accordance with the
terms of the Fund's prospectus. All shares shall be held in book
entry form and no certificate shall be issued unless the Fund is
permitted to do so by its prospectus and the purchaser so
requests.
(2) On receipt of notice that payment was dishonored, the Transfer
Agent shall stop redemptions of all shares owned by the purchaser
related to that payment, place a stop payment on any checks that
have been issued to redeem shares of the purchaser and take such
other action as it deems appropriate.
(b) Redemption of Fund Shares. On receipt of instructions to redeem shares
in accordance with the terms of the Fund's prospectus, the Transfer
Agent will record the redemption of shares of the Fund, prepare and
present the necessary report to the Custodian and pay the proceeds of
the redemption to the shareholder, an authorized agent or legal
representative upon the receipt of the monies from the Custodian.
(c) Transfer or Other Change Pertaining to Fund Shares. On receipt of
instructions or forms acceptable to the Transfer Agent to transfer the
shares to the name of a new owner, change the name or address of the
present owner or take other legal action, the Transfer Agent will take
such action as is requested.
(d) Exchange of Fund Shares. On receipt of instructions to exchange the
shares of the Fund for the shares of another American Express(R) Fund
or other American Express Financial Corporation product in accordance
with the terms of the prospectus, the Transfer Agent will process the
exchange in the same manner as a redemption and sale of shares.
(e) Right to Seek Assurance. The Transfer Agent may refuse to transfer,
exchange or redeem shares of the Fund or take any action requested by
a shareholder until it is satisfied that the requested transaction or
action is legally authorized or until it is satisfied there is no
basis for any claims adverse to the transaction or action. It may rely
on the provisions of the Uniform Act for the Simplification of
Fiduciary Security Transfers or the Uniform Commercial Code. The
Company shall indemnify the Transfer Agent for any act done or omitted
to be done in reliance on such laws or for refusing to transfer,
exchange or redeem shares or taking any requested action if it acts on
a good faith belief that the transaction or action is illegal or
unauthorized.
(f) Shareholder Records, Reports and Services.
(1) The Transfer Agent shall maintain all shareholder accounts, which
shall contain all required tax, legally imposed and regulatory
information; shall provide shareholders, and file with federal
and state agencies, all required tax and other reports pertaining
to shareholder accounts; shall prepare shareholder mailing lists;
shall cause to be printed and mailed all required prospectuses,
annual reports, semiannual reports, statements of additional
information (upon request), proxies and other mailings to
shareholders; and shall cause proxies to be tabulated.
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(2) The Transfer Agent shall respond to all valid inquiries related
to its duties under this Agreement.
(3) The Transfer Agent shall create and maintain all records in
accordance with all applicable laws, rules and regulations,
including, but not limited to, the records required by Section
31(a) of the Investment Company Act of 1940.
(g) Dividends and Distributions. The Transfer Agent shall prepare and
present the necessary report to the Custodian and shall cause to be
prepared and transmitted the payment of income dividends and capital
gains distributions or cause to be recorded the investment of such
dividends and distributions in additional shares of the Fund or as
directed by instructions or forms acceptable to the Transfer Agent.
(h) Confirmations and Statements. The Transfer Agent shall confirm each
transaction either at the time of the transaction or through periodic
reports as may be legally permitted.
(i) Lost or Stolen Checks. The Transfer Agent will replace lost or stolen
checks issued to shareholders upon receipt of proper notification and
will maintain any stop payment orders against the lost or stolen
checks as it is economically desirable to do.
(j) Reports to Company. The Transfer Agent will provide reports pertaining
to the services provided under this Agreement as the Company may
request to ascertain the quality and level of services being provided
or as required by law.
(k) Other Duties. The Transfer Agent may perform other duties for
additional compensation if agreed to in writing by the parties to this
Agreement.
6. Ownership and Confidentiality of Records.
(a) General. The Transfer Agent agrees that all records prepared or
maintained by it relating to the services to be performed by it under
the terms of this Agreement are the property of the Company and may be
inspected by the Company or any person retained by the Company at
reasonable times. The Company and Transfer Agent agree to protect the
confidentiality of those records.
(b) Regulation S-P.
(1) In accordance with Regulation S-P of the Securities and Exchange
Commission "Nonpublic Personal Information" includes (1) all
personally identifiable financial information; (2) any list,
description, or other grouping of consumers (and publicly
available information pertaining to them) that is derived using
any personally identifiable financial information that is not
publicly available information; and (3) any information derived
therefrom.
(2) The Transfer Agent must not use or disclose Nonpublic Personal
Information for any purpose other than to carry out the purpose
for which Nonpublic Personal Information was provided to the
Transfer Agent as set forth in this Agreement, and agrees to
cause the Transfer Agent, and its employees, agents,
representatives, or any other party to whom the Transfer Agent
may provide access to or disclose Nonpublic Personal Information
to limit the use and disclosure of Nonpublic Personal Information
to that purpose.
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(3) The Transfer Agent agrees to implement appropriate measures
designed to ensure the security and confidentiality of Nonpublic
Personal Information, to protect such information against any
anticipated threats or hazards to the security or integrity of
such information, and to protect against unauthorized access to,
or use of, Nonpublic Personal Information that could result in
substantial harm or inconvenience to any customer of the Company;
the Transfer Agent further agrees to cause all its agents,
representatives, subcontractors, or any other party to whom the
Transfer Agent may provide access to, or disclose, Nonpublic
Personal Information to implement appropriate measures designed
to meet the objectives set forth in this paragraph.
(4) With respect only to the provisions of this Section 6(b), the
Transfer Agent agrees to indemnify and hold harmless the Company,
and any officer or director of the Company, against losses,
claims, damages, expenses, or liabilities to which the Company,
or any officer or director of the Company, may become subject as
the result of (1) a material breach of the provisions of this
section of the Agreement or (2) any acts or omissions of the
Transfer Agent, or of any of its officers, directors, employees,
or agents, that are not in substantial accordance with this
Agreement, including, but not limited to, any violation of any
federal statute or regulation. Notwithstanding the foregoing, no
party shall be entitled to indemnification pursuant to this
Section 6(b)(4) if such loss, claim, damage, expense, or
liability is due to the willful misfeasance, bad faith, gross
negligence, or reckless disregard of duty by the party seeking
indemnification.
7. Action by Board and Opinion of Counsel. The Transfer Agent may rely on
resolutions of the Board of Directors (the "Board") or the Executive
Committee of the Board and on opinion of counsel for the Company.
8. Duty of Care. It is understood and agreed that, in furnishing the Company
with the services as herein provided, neither the Transfer Agent, nor any
officer, director or agent thereof shall be held liable for any loss
arising out of or in connection with their actions under this Agreement so
long as they act in good faith and with due diligence, and are not
negligent or guilty of any willful misconduct. It is further understood and
agreed that the Transfer Agent may rely upon information furnished to it
reasonably believed to be accurate and reliable. In the event the Transfer
Agent is unable to perform its obligations under the terms of this
Agreement because of an act of God, strike or equipment or transmission
failure reasonably beyond its control, the Transfer Agent shall not be
liable for any damages resulting from such failure.
9. Term and Termination. This Agreement shall become effective on the date
first set forth above (the "Effective Date") and shall continue in effect
from year to year thereafter as the parties may mutually agree; provided
that either party may terminate this Agreement by giving the other party
notice in writing specifying the date of such termination, which shall be
not less than 60 days after the date of receipt of such notice. In the
event such notice is given by the Company, it shall be accompanied by a
vote of the Board, certified by the Secretary, electing to terminate this
Agreement and designating a successor transfer agent or transfer agents.
Upon such termination and at the expense of the Company, the Transfer Agent
will deliver to such successor a certified list of shareholders of the Fund
(with name, address and taxpayer identification or Social Security number),
a historical record of the account of each shareholder and the status
thereof, and all other relevant books, records, correspondence, and other
data established or maintained by the Transfer Agent under this Agreement
in the form reasonably acceptable to the Company, and will cooperate in the
transfer of such duties and responsibilities, including provisions for
assistance from the Transfer Agent's personnel in the establishment of
books, records and other data by such successor or successors.
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10. Amendment. This Agreement may not be amended or modified in any manner
except by a written agreement executed by both parties.
11. Subcontracting. The Company agrees that the Transfer Agent may subcontract
for certain of the services described under this Agreement with the
understanding that there shall be no diminution in the quality or level of
the services and that the Transfer Agent remains fully responsible for the
services. Except for out-of-pocket expenses identified in Schedule B, the
Transfer Agent shall bear the cost of subcontracting such services, unless
otherwise agreed by the parties.
12. Miscellaneous.
(a) This Agreement shall extend to and shall be binding upon the parties
hereto, and their respective successors and assigns; provided,
however, that this Agreement shall not be assignable without the
written consent of the other party.
(b) This Agreement shall be governed by the laws of the State of
Minnesota.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their respective officers as of the day and year written above.
AXP INVESTMENT SERIES, INC.
AXP DIVERSIFIED EQUITY INCOME FUND
AXP MUTUAL
By: /s/ Xxxxxx X. Xxx
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Xxxxxx X. Xxx
Vice President
AMERICAN EXPRESS CLIENT SERVICE CORPORATION
By: /s/ Xxxxxxx Xxxxx
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Xxxxxxx Xxxxx
Senior Vice President
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Schedule A
AXP INVESTMENT SERIES, INC.
AXP DIVERSIFIED EQUITY INCOME FUND
AXP MUTUAL
FEE
The annual per account fee for services under this agreement, accrued daily and
payable monthly, is as follows:
Class A Class B Class C Class Y
$19.00 $20.00 $19.50 $17.00
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Schedule B
OUT-OF-POCKET EXPENSES
The Company shall reimburse the Transfer Agent monthly for the following
out-of-pocket expenses:
o typesetting, printing, paper, envelopes, postage and return postage for
proxy soliciting material, and proxy tabulation costs
o printing, paper, envelopes and postage for dividend notices, dividend
checks, records of account, purchase confirmations, exchange confirmations
and exchange prospectuses, redemption confirmations, redemption checks,
confirmations on changes of address and any other communication required to
be sent to shareholders
o typesetting, printing, paper, envelopes and postage for prospectuses,
annual and semiannual reports, statements of additional information,
supplements for prospectuses and statements of additional information and
other required mailings to shareholders
o stop orders
o outgoing wire charges
o other expenses incurred at the request or with the consent of the Company
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