Exhibit 9
AGENCY AGREEMENT
THIS AGREEMENT made as of the _______ day of ______________, 19___, by and
between ARIEL GROWTH FUND, a business trust existing under the laws of the
Commonwealth of Massachusetts, having its principal place of business at 000 X.
Xxxxxxxx Xxx., Xxxxx 000, Xxxxxxx, Xxxxxxxx 00000 ("Fund"), and INVESTORS
FIDUCIARY TRUST COMPANY, a state chartered trust company organized and existing
under the laws of the State of Missouri, having its principal place of business
at 000 Xxxx 00xx Xxxxxx, Xxxxxx Xxxx, Xxxxxxxx 00000 ("IFTC"):
WITNESSETH:
WHEREAS, Fund desires to appoint IFTC as Transfer Agent and Paying Agent,
and IFTC desires to accept such appointment;
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
the parties hereto agree as follows:
1. Documents to be Filed with Appointment.
In connection with the appointment of IFTC as Transfer Agent and Paying
Agent for Fund, there will be filed with IFTC the following documents:
A. A certified copy of the resolutions of the Board of Directors of Fund
appointing IFTC as Transfer Agent and Paying Agent, approving the form
of this Agreement, and designating certain persons to sign stock
certificates, if any, and give written instructions and requests on
behalf of Fund;
B. A certified copy of the Articles of Incorporation of Fund and all
amendments thereto;
C. A certified copy of the Bylaws of Fund;
D. Copies of Registration Statements and amendments thereto, filed with
the Securities and Exchange Commission.
E. Specimens of all forms of outstanding stock certificates, in the forms
approved by the Board of Directors of Fund, with a certificate of the
Secretary of Fund, as to such approval;
F. Specimens of the signatures of the officers of the Fund authorized to
sign stock certificates and individuals authorized to sign written
instructions and requests;
G. An opinion of counsel for Fund with respect to:
(1) Fund's organization and existence under the laws of its state
of organization;
(2) The status of all shares of stock of Fund covered by the
appointment under the Securities Act of 1933, as amended, and
any other applicable federal or state statute; and
(3) That all issued shares are, and all unissued shares will be,
when issued, validly issued, fully paid and nonassessable.
2. Certain Representations and Warranties of IFTC.
IFTC represents and warrants to Fund that:
A. It is a trust company duly organized and existing and in good standing
under the laws of Missouri.
B. It is duly qualified to carry on its business in the State of
Missouri.
C. It is empowered under applicable laws and by its Articles of
Incorporation and bylaws to enter into and perform the services
contemplated in this Agreement.
D. It is registered as a transfer agent to the extent required under the
Securities Exchange Act of 1934.
E. All requisite corporate proceedings have been taken to authorize it to
enter into and perform this Agreement.
3. Certain Representations and Warranties of Fund.
Fund represents and warrants to IFTC that:
A. It is a business trust duly organized and existing and in good
standing under the laws of the Commonwealth of Massachusetts.
B. It is an open-end, diversified management investment company
registered under the Investment Company Act of 1940, as amended.
C. A registration statement under the Securities Act of 1933 has been
filed and will be effective with respect to all shares of Fund being
offered for sale.
D. All requisite steps have been and will continue to be taken to
register Fund's shares for sale in all applicable states and such
registration will be effective at all times shares are offered for
sale in such state.
E. Fund is empowered under applicable laws and by its charter and bylaws
to enter into and perform this Agreement.
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4. Scope of Appointment.
A. Subject to the conditions set forth in this Agreement, Fund hereby
appoints IFTC as Transfer Agent and Paying Agent.
B. IFTC hereby accepts such appointment and agrees that it will act as
Fund's Transfer Agent and Paying Agent. IFTC agrees that it will also
act as agent in connection with Fund's periodic withdrawal payment
accounts and other open accounts or similar plans for shareholders, if
any.
C. Fund agrees to deliver or to cause to be delivered to IFTC in Kansas
City, Missouri, all of its shareholder account records.
D. IFTC, utilizing TA2000/TM/, a computerized data processing
recordkeeping system for securityholder accounting, shall perform the
following services as transfer, paying and shareholders' servicing
agent for the Fund, and as agent of the Fund for shareholder accounts
thereof, in a timely manner: issuing (including countersigning),
transferring and canceling share certificates; answering and
responding to telephone inquiries from shareholders and broker-
dealers; maintaining all shareholder accounts; providing transaction
journals; preparing shareholder meeting lists, mailing proxies and
proxy materials, receiving and tabulating proxies, and certifying the
shareholder votes in the Fund; mailing shareholder reports and
prospectuses; withholding, as required by Federal law, taxes on
shareholder accounts, disbursing income dividends and capital gains
distributions to shareholders, preparing, filing and mailing U.S.
Treasury Department Forms 1099, 1042S and backup withholding as
instructed by the Fund and as required for all shareholders; preparing
and mailing confirmation forms to shareholders and dealers, as
instructed, for all purchases and liquidations of shares of the Fund
and other confirmable transactions in shareholders' accounts;
recording reinvestment of dividends and distributions in shares of the
Fund; providing or making available on-line daily and monthly reports
as provided by the mutual fund processing system utilized by IFTC (the
"TA2000/TM/ System") and as requested by the Fund or its management
company; maintaining those records necessary to carry out IFTC's
duties hereunder, including all information reasonably required by the
Fund to account
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for all transactions in Fund shares, calculating the appropriate sales
charge with respect to each purchase of Fund shares as set forth in
the prospectus for the Fund, determining the portion of each sales
charge payable to the dealer participating in a sale in accordance
with schedules delivered to IFTC by the Fund's principal underwriter
or distributor (hereinafter "principal underwriter") from time to
time, disbursing dealer commissions collected to such dealers,
determining the portion of each sales charge payable to such principal
underwriter and disbursing such commissions to the principal
underwriter; receiving correspondence pertaining to any former,
existing or new shareholder account, processing such correspondence
for proper recordkeeping, and responding promptly to shareholder
correspondence; mailing to dealers confirmations of wire order trades;
mailing copies of shareholder statements to shareholders and
registered representatives of dealers in accordance with the
shareholders' or the Fund's instructions; processing, generally on the
date of receipt, purchases or redemptions or instructions to settle
any mail or wire order purchases or redemptions received in proper
order as set forth in the prospectus, rejecting promptly any requests
not received in proper order (as defined by the Fund or its agents);
causing exchanges of shares to be executed in accordance with
shareholders' and the Fund's instructions, the prospectus and the
exchange privilege as set forth in the applicable application;
transferring monies to and receiving monies from the Fund's Custodian,
as appropriate; and interfacing with and receiving, providing and
processing information as appropriate in connection with programs
offered by the National Securities Clearing Corporation ("NSCC") to
the extent the Fund has elected and executed the appropriate
agreements with NSCC.
E. IFTC shall use reasonable efforts to provide, reasonably promptly
under the circumstances, services with respect to any new, additional
Fund functions or features or any changes or improvements to existing
Fund functions or features provided for in Fund's instructions or
prospectus, as amended from time to time, provided (i) IFTC is
advised, a reasonable time in advance, by the Fund of any changes
therein and (ii) the TA2000/TM/ System and mode of operations utilized
by IFTC as then constituted
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supports such additional functions and features. If any addition to,
improvement of or change in the Fund features and functions currently
provided or the operations as requested by the Fund requires an
enhancement or modification to the TA2000/TM/ System or to operations
as then conducted by IFTC, IFTC shall not be liable therefor until
such modification or enhancement is installed on the TA2000/TM/ System
or new mode of operation is instituted. If any new or additional Fund
function or feature, change or improvement to existing Fund functions
or features, or new service or change in mode of operation required by
the Fund increases IFTC's cost of performing the services required
hereunder at the then current level of service, IFTC shall advise the
Fund of the amount of such increase and if the Fund elects to utilize
such function, feature or changed method of service, IFTC shall be
entitled to increase its fees by the amount of the increase in costs.
F. To the extent that the Fund requests IFTC to perform any of the
foregoing services in a manner not consistent with utilization of
TA2000/TM/ or IFTC's usual processing procedures or to the extent the
Fund requests performance of additional services not enumerated above,
IFTC and the Fund shall mutually agree as to the services to be
accomplished, the manner of accomplishment and the compensation to
which IFTC shall be entitled with respect thereto.
5. Compensation and Expenses.
A. In consideration for its services hereunder as Transfer Agent and
Paying Agent, Fund will pay to IFTC such compensation as shall be set
forth in a separate fee schedule to be agreed to by Fund and IFTC from
time to time. A copy of the initial fee schedule is attached hereto
and incorporated herein by reference. IFTC may charge against any
monies held by it for the Fund, the amount of any compensation and/or
loss, damage, liability, advance, overdraft or expense for which it
shall be entitled to payment or reimbursement from the Fund.
B. The Fund also agrees promptly to reimburse IFTC for all reasonable
out-of-pocket expenses or disbursements incurred by IFTC in connection
with the performance of services under this Agreement including, but
not limited to, expenses for postage,
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express delivery services, freight charges, envelopes, checks, drafts,
forms (continuous or otherwise), specially requested reports and
statements, telephone calls, telegraphs, stationary supplies, counsel
fees, outside printing and mailing firms (including Output Technology,
Inc. and Support Resources, Inc.), magnetic tapes, reels or cartridges
(if sent to a Fund or to third party at the Fund's request) and
magnetic tape handling charges, off-site record storage, media for
storage of records (e.g., microfilm, microfiche, optical platters,
computer tapes), computer equipment installed at the Fund's request at
the Fund's or a third party's premises, telecommunications equipment,
telephone/telecommunication lines between Fund and its agents, on one
hand, and IFTC on the other, proxy soliciting, processing and/or
tabulating costs, second-site backup computer facility, transmission
of statement data for remote printing or processing, and NSCC
transaction fees to the extent any of the foregoing are paid by IFTC.
The Fund agrees to pay postage expenses at least one day in advance if
so requested. In addition, any other expenses incurred by IFTC at the
request or with the consent of the Fund will be promptly reimbursed by
the Fund.
C. Amounts due hereunder shall be due and paid by the Fund on or before
the thirtieth (30th) day after the date of the statement therefor (the
"Due Date"). The Fund is aware that its failure to pay all amounts in
a timely fashion so that they will be received by IFTC on or before
the Due Date will give rise to costs to IFTC not contemplated by this
Agreement, including but not limited to carrying, processing and
accounting charges. Accordingly, subject to Section 5.D. hereof, in
the event that any amounts due hereunder are not received by IFTC by
the Due Date, the Fund shall pay a late charge equal to the rate set
forth in the Fee Schedule. The parties hereby agree that such late
charge represents a fair and reasonable computation of the costs
incurred by reason of late payment or payment of amounts not properly
due. Acceptance of such late charge shall in no event constitute a
waiver of the Fund's or IFTC's default or prevent the non-defaulting
party from exercising any other rights and remedies available to it.
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D. In the event that any charges are disputed, the Fund shall, on or
before the Due Date, pay all undisputed amounts due hereunder and
notify IFTC in writing of any disputed charges for out-of-pocket
expenses which it is disputing in good faith. Payment for such
disputed charges shall be due on or before the close of the fifth
(5th) business day after the day on which IFTC provides to the Fund
documentation which an objective observer would agree reasonably
supports the disputed charges (the "Revised Due Date"). Late charges
shall not begin to accrue as to charges disputed in good faith until
the first day after the Revised Due Date.
6. Operation of IFTC System.
In connection with the performance of its services under this Agreement,
IFTC is responsible for such items as:
A. That entries in IFTC's records and in the Fund's records on the
TA2000/TM/ System created by IFTC reflect the orders, instructions,
and other information received by IFTC from broker-dealers,
shareholders, the Fund, the Fund's principal underwriter or Fund's
investment adviser;
B. That shareholder lists, shareholder account verifications,
confirmations and other shareholder account information to be produced
from its records or data be available and accurately reflect the data
in the Fund's records on the TA2000/TM/ System;
C. The accurate and timely issuance of dividend and distribution checks
in accordance with instructions received from the Fund and the data
in the Fund's records on the TA2000/TM/ System;
D. That redemption transactions and payments be effected timely and
accurately in accordance with redemption instructions received by IFTC
from dealers, shareholders, the Fund or the Fund's principal
underwriter and the data in the Fund's records on the TA2000/TM/
System;
E. The deposit daily in the Fund's appropriate special bank account of
all checks and payments received by IFTC from NSCC, broker-dealers or
shareholders for investment in shares;
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F. Notwithstanding anything herein to the contrary, with respect to "as
of" adjustments, IFTC will not assume one hundred percent (100%)
responsibility for losses resulting from "as of's" due to clerical
errors or misinterpretations of shareholder instructions, but IFTC
will discuss with the Fund IFTC's accepting liability for an "as of"
on a case-by-case basis and may accept financial responsibility for a
particular situation resulting in a financial loss to the Fund where
IFTC in its discretion deems that to be appropriate;
G. The requiring of proper forms of instructions, signatures and
signature guarantees and any necessary documents supporting the
opening of shareholder accounts transfers, redemptions and other
shareholder account transactions, all in conformance with IFTC's
present procedures as set forth in its Legal Manual, Third Party Check
Procedures, Checkwriting Draft Procedures, and Signature Guarantee
Procedures with such changes or deviations therefrom as may be from
time to time required or approved by the Fund, its investment adviser
or principal underwriter, or their or IFTC's counsel (the
"Procedures") and the rejection of orders or instructions not in good
order in accordance with the applicable prospectus or the Procedures;
H. The maintenance of customary records in connection with its agency,
and particularly those records required to be maintained pursuant to
subparagraph (2) (iv) of paragraph (b) of Rule 31a-1 under the
Investment Company Act of 1940, if any; and
I. The maintenance of a current, duplicate set of the Fund's essential
records at a secure separate location, in a form available and usable
forthwith in the event of any breakdown or disaster disrupting its
main operation.
7. Indemnification.
A. IFTC shall at all times use reasonable care, due diligence and act in
good faith in performing its duties under this Agreement. IFTC shall
be presumed to have used reasonable care, due diligence and acted in
good faith (i) if it has acted in accordance with the Procedures,
copies of which have been provided to the Fund and have been reviewed
and approved by Fund counsel, or (ii) if any deviation from such
Procedures was approved by the Fund, Fund's counsel or IFTC's counsel.
The Procedures may
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be amended from time to time with approval of IFTC's counsel or the
Fund. IFTC shall not be responsible for, and the Fund shall indemnify
and hold IFTC harmless from and against, any and all losses, damages,
costs, charges, counsel fees, payments, expenses and liability which
may be asserted against IFTC, incurred by IFTC or for which IFTC may
be held to be liable, arising out of or attributable to:
(1) All actions of IFTC required to be taken by IFTC pursuant to
this Agreement, provided that IFTC has acted in good faith and
with due diligence and reasonable care;
(2) The Fund's refusal or failure to comply with the terms of this
Agreement (including without limitation the Fund's failure to
pay or reimburse IFTC under this indemnification provision), the
Fund's negligence or willful misconduct, or the breach of any
representation or warranty of the Fund hereunder;
(3) The good faith reliance on, or the carrying out of, any written
or recorded oral instructions or requests of persons designated
by the Fund in writing from time to time as authorized to give
instructions on its behalf or representatives of the Fund's
investment adviser, sponsor or principal underwriter or IFTC's
good faith reliance on, or use of, information, data, records
and documents received from, or which have been prepared and/or
maintained by the Fund, its investment adviser, its sponsor or
its principal underwriter;
(4) Defaults by dealers or shareowners with respect to payment for
share orders previously entered;
(5) The offer or sale of the Fund's shares in violation of any
requirement under federal or state securities laws or
regulations or in violation of any stop order or other
determination or ruling by any federal or state agency with
respect to the offer or sale of such shares (unless such
violation results from IFTC's failure to comply with written
instructions of the Fund or of any officer of the Fund that no
offers or sales to residents of such state be input into the
Funds securityholder records);
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(6) The Fund's errors and mistakes in the use of the TA2000/TM/
System, the data center, computer and related equipment used to
access the TA2000/TM/ System (the "TA2000/TM/ Facilities"), and
control procedures relating thereto in the verification of
output and in the remote input of data;
(7) Errors, inaccuracies, out-of-balance conditions and omissions
in, or errors, inaccuracies or omissions of IFTC arising out of
or resulting from such errors, inaccuracies, out-of-balance
conditions and omissions in, the Fund's records, shareholder and
other records, delivered to IFTC hereunder by the Fund or its
prior agent(s); and
(8) Actions or omissions to act by the Fund or agents designated by
the Fund with respect to duties assumed thereby as provided for
in Section 20 hereof.
B. Except where IFTC is entitled to indemnification under Section 7.A.
hereof, IFTC shall indemnify and hold the Fund harmless from and
against any and all losses, damages, costs, charges, counsel fees,
payments, expenses and liability arising out of IFTC's failure to
comply with the terms of this Agreement or arising out of or
attributable to IFTC's negligence or willful misconduct or breach of
any representation or warranty of IFTC hereunder. Notwithstanding
anything herein to the contrary, IFTC will not indemnify or hold the
Fund harmless as to losses, damages, costs, charges, counsel fees,
payments, expenses and liability arising out of or resulting from "as
of's" due to clerical errors or misinterpretations of shareholder
instructions, but IFTC will discuss with the Fund on a case-by-case
basis the possibility of IFTC's accepting liability for a particular
"as of" and may accept financial responsibility for a particular
situation resulting in a financial loss to the Fund where IFTC in its
discretion deems that to be appropriate.
C. EXCEPT FOR VIOLATIONS OF SECTION 22, IN NO EVENT AND UNDER NO
CIRCUMSTANCES SHALL EITHER PARTY TO THIS AGREEMENT BE LIABLE TO
ANYONE, INCLUDING, WITHOUT LIMITATION TO THE OTHER PARTY, FOR
CONSEQUENTIAL OR PUNITIVE DAMAGES FOR
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ANY ACT OR FAILURE TO ACT UNDER ANY PROVISION OF THIS AGREEMENT EVEN
IF ADVISED OF THE POSSIBILITY THEREOF.
8. Certain Covenants of IFTC and Fund.
A. All requisite steps will be taken by Fund from time to time when and
as necessary to register the Fund's shares for sale in all states in
which Fund's shares shall at the time be offered for sale and require
registration. If at any time Fund will receive notice of any stop
order or other proceeding in any such state affecting such
registration or the sale of Fund's shares, or of any stop order or
other proceeding under the federal securities laws affecting the sale
of Fund's shares, Fund will give prompt notice thereof to IFTC.
B. IFTC hereby agrees to perform such transfer agency functions as are
set forth in section 4.D. above and establish and maintain facilities
and procedures for safekeeping of stock certificates, check forms, and
facsimile signature imprinting devices, if any; and for the
preparation or use, and for keeping account of, such certificates,
forms and devices, and to carry such insurance as it considers
adequate and reasonably available.
C. To the extent required by Section 31 of the Investment Company Act of
1940 (the "1940 Act") as amended and Rules thereunder, IFTC agrees
that all records maintained by IFTC relating to the services to be
performed by IFTC under this Agreement are the property of Fund and
will be preserved for the period required by the 1940 Act or such
longer period as the Fund may require in writing and will be
surrendered promptly to Fund on request.
D. IFTC will permit Fund and its authorized accountants, upon the
execution of IFTC's Confidentiality Agreement, to make periodic
inspections and audits of its operations as such would involve the
Fund at reasonable times during business hours.
9. Recapitalization or Readjustment.
In case of any recapitalization, readjustment or other change in the
capital structure of Fund requiring a change in the form of stock
certificates, IFTC will issue or register certificates in
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the new form in exchange for, or in transfer of, the outstanding
certificates in the old form, upon receiving:
A. Written instructions from an officer of Fund; and
B. Specimens and a sufficient working supply of the new certificates in
the form approved by the Board of Directors of Fund, with a
certificate of the Secretary of Fund as to such approval.
10. Stock Certificates.
Fund will furnish IFTC with a sufficient supply of blank stock certificates
and from time to time will renew such supply upon the request of IFTC. Such
certificates will be signed manually or by facsimile signatures of the
officers of Fund authorized by law and by bylaws to sign stock
certificates, and if required, will bear the corporate seal or facsimile
thereof.
11. Death, Resignation or Removal of Signing Officer.
Fund will file promptly with IFTC written notice of any change in the
officers authorized to sign stock certificates, written instructions or
requests, together with two signature cards bearing the specimen signature
of each newly authorized officer. In case any officer of Fund who will have
signed manually or whose facsimile signature will have been affixed to
blank stock certificates will die, resign, or be removed prior to the
issuance of such certificates, IFTC may issue or register such stock
certificates as the stock certificates of Fund notwithstanding such death,
resignation, or removal, until specifically directed to the contrary by
Fund in writing. In the absence of such direction, Fund will file promptly
with IFTC such approval, adoption, or ratification as may be required by
law.
12. Future Amendments of Charter and Bylaws.
Fund will promptly file with IFTC copies of all material amendments to its
Articles of Incorporation or bylaws made after the date of this Agreement.
13. Instructions, Opinion of Counsel and Signatures.
At any time IFTC may apply to any person authorized by the Fund to give
instructions to IFTC, or, at the expense of the Fund, may consult with
legal counsel for Fund or, at the expense of the Fund and with the approval
of a Fund officer, may consult with its own legal counsel with respect to
any matter arising in connection with the agency and it will not be
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liable for any action taken or omitted by it in good faith in reliance upon
such instructions or upon the opinion of such counsel. IFTC will be
protected in acting upon any paper or document reasonably believed by it to
be genuine and to have been signed by the proper person or persons and will
not be held to have notice of any change of authority of any person until
receipt of written notice thereof from Fund. It will also be protected in
recognizing stock certificates which it reasonably believes to bear the
proper manual or facsimile signatures of the officers of Fund, and the
proper countersignature of any former transfer agent or registrar, or of a
co-transfer agent or co-registrar.
14. Papers Subject to Approval of Counsel.
The acceptance by IFTC of its appointment as transfer agent, agent and
depository and all documents filed in connection with such appointment and
thereafter in connection with the agencies, will be subject to the approval
of legal counsel for IFTC (which approval will be not unreasonably
withheld).
15. Certification of Documents.
The required copy of the articles of incorporation of Fund and copies of
all amendments thereto will be certified by the Secretary of State (or
other appropriate official) of the state of incorporation, and if such
articles of incorporation and amendments are required by law to be also
filed with a county, city or other officer of official body, a certificate
of such filing will appear on the certified copy submitted to IFTC. A copy
of the order or consent of each governmental or regulatory authority
required by law to the issuance of the stock will be certified by the
Secretary or Clerk of such governmental or regulatory authority, under
proper seal of such authority. The copy of the bylaws and copies of all
amendments thereto, and copies of resolutions of the Board of Directors of
Fund, will be certified by the secretary or an assistant secretary of Fund
under the Fund's seal.
16. Records.
IFTC will maintain customary records in connection with its agency, and
particularly will maintain those records required to be maintained pursuant
to subparagraph (2) (iv) of paragraph (b) of Rule 31a-1 under the
Investment Company Act of 1940, if any.
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17. Disposition of Books, Records and Canceled Certificates.
IFTC may send periodically to Fund, or to where designated by the Fund, all
books, documents, and all records no longer deemed needed for current
purposes and stock certificates which have been canceled in transfer or in
exchange, upon the understanding that such books, documents, records, and
stock certificates will be maintained by the Fund under and in accordance
with the requirements of Section 17Ad-7 adopted under the Securities
Exchange Act of 1934. Such materials will not be destroyed by Fund without
the consent of IFTC (which consent will not be unreasonably withheld), but
will be safely stored for possible future reference.
18. Provisions Relating to IFTC as Transfer Agent.
A. IFTC will make original issues of stock certificates upon written
request of an officer of Fund and upon being furnished with a
certified copy of a resolution of the Board of Directors authorizing
such original issue, an opinion of counsel and other documents as
outlined in paragraph 1. of this Agreement, a sufficient supply of
blank stock certificates and necessary funds for the payment of any
original issue tax.
B. Before making any original issue of certificates Fund will furnish
IFTC with sufficient funds to pay all required taxes on the original
issue of the stock, if any. Fund will furnish IFTC such evidence as
may be required by IFTC to show the actual value of the stock. Fund
shall be responsible for ascertaining if any taxes are required to be
paid and, if so, for paying such taxes.
C. Shares of stock will be transferred and new certificates issued in
transfer, or shares of stock accepted for redemption and funds
remitted therefor, upon surrender of the old certificates in form
deemed by IFTC properly endorsed for transfer or redemption
accompanied by such documents as IFTC may deem necessary to evidence
that authority of the person making the transfer or redemption, and
bearing satisfactory evidence of the payment of any applicable stock
transfer taxes. IFTC reserves the right to refuse to transfer or
redeem shares until it is satisfied that the endorsement or signature
on the certificate or any other document is valid and genuine, and for
that purpose it may require a guaranty of signature by an eligible
guarantor institution, as
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that term is defined in Rule 17Ad-15, adopted under the Securities
Exchange Act of 1934, and as implemented by IFTC's Signature Guarantee
Procedures. IFTC also reserves the right to refuse to transfer or
redeem shares until it is satisfied that the requested transfer or
redemption is legally authorized, and it will incur no liability for
the refusal in good faith to make transfers or redemptions which, in
its judgment, are improper or unauthorized. IFTC may, in effecting
transfers or redemptions, rely upon Simplification Acts or other
statutes which protect it and Fund in not requiring complete fiduciary
documentation. In cases in which IFTC is not directed or otherwise
required to maintain the consolidated records of shareholder's
accounts, IFTC will not be liable for any loss which may arise by
reason of not having such records.
D. When mail is used for delivery of stock certificates, IFTC will
forward stock certificates in "nonnegotiable" form by first class or
registered mail and stock certificates in "negotiable" form by
registered mail, all such mail deliveries to be covered while in
transit to the addressee by insurance arranged for by IFTC.
E. IFTC will issue and mail subscription warrants, certificates
representing stock dividends, exchanges or split ups, or act as
conversion agent upon receiving written instructions from any officer
of Fund and such other documents as IFTC deems necessary.
F. IFTC will issue, transfer, and split up certificates and will issue
certificates of stock representing full shares upon surrender of scrip
certificates aggregating one full share or more when presented to IFTC
for that purpose upon receiving written instructions from an officer
of Fund and such other documents as IFTC may deem necessary.
G. IFTC may issue new certificates in place of certificates represented
to have been lost, destroyed, stolen or otherwise wrongfully taken
upon receiving instructions from Fund and indemnity satisfactory to
IFTC and Fund, and may issue new certificates in exchange for, and
upon surrender of, mutilated certificates.
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H. IFTC will supply a shareholder's list to Fund for its annual meeting
upon receiving a request from an officer of Fund. It will also
supply lists at such other times as may be requested by an officer of
Fund.
I. Upon receipt of written instructions of an officer of Fund, IFTC will
address and mail notices to shareholders.
J. In case of any request or demand for the inspection of the stock books
of Fund or any other books in the possession of IFTC, IFTC will
endeavor to notify Fund and to secure instructions as to permitting or
refusing such inspection. IFTC reserves the right, however, to exhibit
the stock books or other books to any person in case it is advised by
its counsel that it may be held responsible for the failure to exhibit
the stock books or other books to such person.
19. Provisions Relating to Paying Agency.
A. IFTC will, at the expense of Fund, provide a special form of check
containing the imprint of any device or other matter desired by Fund.
Said checks must, however, be of a form and size convenient for use by
IFTC.
B. If Fund desires to include additional printed matter, financial
statements, etc., with the dividend checks, the same will be furnished
to IFTC within a reasonable time prior to the date of mailing of the
dividend checks, at the expense of Fund.
C. If Fund desires its distributions mailed in any special form of
envelopes, sufficient supply of the same will be furnished to IFTC but
the size and form of said envelopes will be subject to the approval of
IFTC. If stamped envelopes are used, they must be furnished by Fund;
or if postage stamps are to be affixed to the envelopes, the stamps or
the cash necessary for such stamps must be furnished by Fund.
D. IFTC will open and maintain in its banking department one or more
non-interest bearing deposit accounts as agent for Fund, into which
the moneys received for the account of the Fund for payment of
dividends, distributions, redemptions or other disbursements provided
for hereunder will be deposited, and against which checks will be
drawn. If IFTC shall in its sole discretion advance funds to or for
the account of Fund which results in an overdraft in any such account
because the monies held
16
therein by IFTC on behalf of Fund are insufficient to pay the total
amount payable from such account for any reason, the amount of the
overdraft shall be payable by Fund to IFTC upon demand together with
the overdraft charge set forth in the then-current fee schedule from
the date advanced until the date final payment is received.
E. IFTC is authorized and directed to stop payment of checks theretofore
issued hereunder, but not presented for payment, when the payees
thereof allege either that they have not received the checks or that
such checks have been mislaid, lost, stolen, destroyed or through no
fault of theirs, are otherwise beyond their control, and cannot be
produced by them for presentation and collection, and, to issue and
deliver duplicate checks in replacement thereof.
20. Assumption of Duties By the Fund or Agents Designated By the Fund.
A. The Fund, its designated agents other than IFTC or any subcontractor
employed by the Fund or IFTC at the direction or request of the Fund
may assume certain duties and responsibilities of IFTC or those
services of Transfer Agent and Paying Agent as those terms are
referred to in Section 4.D. of this Agreement including but not
limited to: answering and responding to telephone inquiries from
shareholders and broker-dealers; accepting shareholder and broker
instructions (both oral and written) and transmitting orders or
directions based on such instructions to IFTC; preparing and mailing
confirmations; obtaining certified TIN numbers; establishing
shareholder accounts on the TA2000/TM/ System, classifying the status
of shareholders and shareholder accounts under applicable tax law and
assigning social codes and Taxpayer Identification Number codes
thereto; and disbursing monies of the Fund. Any assumption of duties
and responsibilities and any amendments thereto must be embodied in
writing and signed by both parties.
B. To the extent the Fund or its agent or affiliate assumes such duties
and responsibilities, IFTC shall be relieved from all responsibility
and liability therefor and is hereby indemnified and held harmless
against any liability therefrom and in the same manner and degree as
provided for in Section 7 hereof.
17
21. Termination of Agreement.
A. This Agreement shall remain in full force and effect for a period of
two (2) years, the initial term of this Agreement, and thereafter
shall automatically extend for additional, successive twelve (12)
month terms upon the expiration of any term hereof, unless terminated
at any time after the initial term by either party by delivery of six
(6) months prior written notice of termination to the other party.
B. Each party, in addition to any other rights and remedies, shall have
the right to terminate this Agreement forthwith upon the occurrence
at any time of any of the following events with respect to the other
party:
(1) Any interruption or cessation of operations by the other party
or its assigns which materially interferes with the business
operation of the first party;
(2) The bankruptcy of the other party or its assigns or the
appointment of a receiver for the other party or its assigns;
(3) Any merger, consolidation or sale of substantially all the
assets of the other party or its assigns; or
(4) Failure by the other party or its assigns to perform its duties
in accordance with the Agreement, which failure materially
adversely affects the business operations of the first party and
which failure continues for thirty (30) days after receipt of
written notice from the first party.
C. In the event of termination, Fund will promptly pay IFTC all amounts
due to IFTC hereunder.
D. In the event of termination, IFTC will use its best efforts to
transfer the books and records of the Fund to the designated successor
transfer agent and to provide other information relating to its
service provided hereunder for reasonable compensation therefore.
22. Confidentiality.
A. IFTC agrees that, except as provided in the last sentence of Section
19.J hereof, or as otherwise required by law, IFTC will keep
confidential all records of and information in its possession relating
to Fund or its shareholders or shareholder
18
accounts and will not disclose the same to any person except at the
request or with the consent of Fund.
B. Fund agrees to keep confidential all financial statements and other
financial records and all manuals, systems and other technical
information and data, not publicly disclosed, relating to IFTC's
operations and programs furnished to it by IFTC pursuant to this
Agreement and will not disclose the same to any person except at the
request or with the consent of IFTC.
C. The Fund acknowledges that IFTC and DST Systems, Inc. (DST) have
proprietary rights in and to the TA2000/TM/ System, including, without
limitation any changes or modifications thereto and any other IFTC or
DST programs, code, techniques, know-how, data bases, supporting
documentation, data formats, or procedures ("collectively IFTC
Protected Information") which the Fund's access to the TA2000/TM/
System or TA2000/TM/ Facilities may permit the Fund or its employees
or agents to become aware of or to access and that the IFTC Protected
Information constitutes confidential material and trade secrets of
IFTC. The Fund agrees to maintain the confidentiality of the IFTC
Protected Information. The Fund acknowledges that any unauthorized
use, misuse, disclosure or taking of IFTC Protected Information which
is confidential as provided by law, or which is a trade secret,
residing or existing internal or external to a computer, computer
system, or computer network, or the knowing and unauthorized accessing
or causing to be accessed of any computer, computer system, or
computer network, may be subject to civil liabilities and criminal
penalties under applicable law. The Fund will advise all of its
employees and agents who have access to any IFTC Protected Information
or to any computer equipment capable of accessing IFTC or DST hardware
or software of the foregoing. DST is intended to be, and shall be, a
third party beneficiary of the Fund's obligations and undertakings
contained in this Section.
23. Changes and Modifications.
A. During the term of this Agreement IFTC will use on behalf of the Fund
without additional cost all modifications, enhancements, or changes
which DST or IFTC may
19
make to its shareholder/transfer agent processing system in the normal
course of its business and which are applicable to functions and
features offered by the Fund, unless substantially all DST or IFTC
clients are charged separately for such modifications, enhancements or
changes, including, without limitation, substantial system revisions
or modifications necessitated by changes in existing laws, rules or
regulations. The Fund agrees to pay IFTC promptly for modifications
and improvements which are charged for separately at the rate provided
for in DST's or IFTC's standard pricing schedule which shall be
identical for substantially all clients, if a standard pricing
schedule shall exist. If there is no standard pricing schedule, the
parties shall mutually agree upon the rates to be charged.
B. IFTC shall have the right, at any time and from time to time, to alter
and modify any systems, programs, procedures or facilities used or
employed in performing its duties and obligations hereunder; provided
that the Fund will be notified as promptly as possible prior to
implementation of such alterations and modifications and that no such
alteration or modification or deletion shall materially adversely
change or affect the operations and procedures of the Fund in using or
employing the TA2000/TM/ System or the TA2000/TM/ Facilities hereunder
or the reports to be generated by such system and facilities
hereunder, unless the Fund is given thirty (30) days prior notice to
allow the Fund to change its procedures and IFTC provides the Fund
with revised operating procedures and controls.
C. All enhancements, improvements, changes, modifications or new features
added to the TA2000/TM/ System or otherwise made available by IFTC for
use in connection with the business of the Fund however developed or
paid for shall be, and shall remain, the confidential and exclusive
property of, and proprietary to, DST Systems, Inc. and IFTC.
24. Subcontractors.
The Fund acknowledges that IFTC intends to subcontract certain obligations
hereunder to affiliated entities and consents to such subcontracting on
condition that IFTC shall remain fully responsible and liable for the
complete and proper performance of IFTC's obligations
20
hereunder, that all acts and omissions of any such subcontractor hereunder
shall for all purposes hereof be considered and deemed to be acts or
omissions of IFTC and that the Fund shall be fully responsible and liable
hereunder to IFTC as if no subcontract had occurred and such obligations
had been performed by IFTC itself. Nothing herein shall impose any duty
upon IFTC in connection with or make IFTC liable for the actions or
omissions to act of unaffiliated third parties such as, by way of example
and not limitation, courier or next day delivery services, shipping
companies, the U.S. mails or telecommunication companies, provided that, if
IFTC selected such company, IFTC shall have exercised due care in selecting
the same.
25. Force Majeure.
IFTC shall not be responsible or liable for its failure or delay in
performance of its obligations under this Agreement arising out of or
caused, directly or indirectly, by circumstances beyond its reasonable
control, including, without limitation: any interruption, loss or
malfunction of any utility, transportation, computer (hardware or software)
or communication service; inability to obtain labor, material, equipment or
transportation, or a delay in mails; governmental or exchange action,
statute, ordinance, rulings, regulations or direction; war, strike, riot,
emergency, civil disturbance, terrorism, vandalism, explosions, labor
disputes, freezes, floods, fires, tornados, acts of God or public enemy,
revolutions, or insurrection; or any other cause, contingency, circumstance
or delay not subject to IFTC's control which prevents or hinders IFTC's
performance hereunder.
26. Limitations on Liability.
A. If Fund is comprised of more than one Portfolio, each Portfolio shall
be regarded for all purposes hereunder as a separate party apart from
each other Portfolio. Unless the context otherwise requires, with
respect to every transaction covered by this Agreement, every
reference herein to the Fund shall be deemed to relate solely to the
particular Portfolio to which such transaction relates. Under no
circumstances shall the rights, obligations or remedies with respect
to a particular Portfolio constitute a right, obligation or remedy
applicable to any other Portfolio. The use of this single document to
memorialize the separate agreement of each Portfolio is understood to
21
be for clerical convenience only and shall not constitute any basis
for joining the Portfolios for any reason.
B. Notice is hereby given that a copy of Fund's Trust Agreement and all
amendments thereto is on file with the Secretary of State of the state
of its organization; that this Agreement has been executed on behalf
of Fund by the undersigned duly authorized representative of Fund in
his/her capacity as such and not individually; and that the
obligations of this Agreement shall only be binding upon the assets
and property of Fund and shall not be binding upon any trustee,
officer or shareholder of Fund individually.
27. Miscellaneous.
A. This Agreement shall be construed according to, and the rights and
liabilities of the parties hereto shall be governed by, the laws of
the State of Missouri, without reference to the choice of law
provisions thereof.
B. All terms and provisions of this Agreement shall be binding upon,
inure to the benefit of and be enforceable by the parties hereto and
their respective successors and permitted assigns.
C. The representations and warranties, the indemnification extended
hereunder, and the provisions of Sections 22 and 26 are intended to
and shall continue after and survive the expiration, termination or
cancellation of this Agreement.
D. No provisions of the Agreement may be amended or modified in any
manner except by a written agreement properly authorized and executed
each party hereto.
E. The captions in the Agreement are included for convenience of
reference only, and in no way define or delimit any of the provisions
hereof or otherwise affect their construction or effect.
F. This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original but all of which together shall
constitute one and the same instrument.
G. If any part, term or provision of this Agreement is determined by the
courts or any regulatory authority having jurisdiction over the issue
to be illegal, in conflict with any
22
law or otherwise invalid, the remaining portion or portions shall be
considered severable and not be affected, and the rights and
obligations of the parties shall be construed and enforced as if the
Agreement did not contain the particular part, term or provision held
to be illegal or invalid.
H. This Agreement may not be assigned by either party hereto without the
prior written consent of the other party.
I. Neither the execution nor performance of this Agreement shall be
deemed to create a partnership or joint venture by and between Fund
and IFTC. It is understood and agreed that all services performed
hereunder by IFTC shall be as an independent contractor and not as an
employee of the Fund. This Agreement is between IFTC and the Fund and,
except with respect to DST Systems, Inc. under Section 22 C hereof,
neither this Agreement nor the performance of services under it shall
create any rights in any third parties. There are no third party
beneficiaries hereto.
J. Except as specifically provided herein, this Agreement does not in any
way affect any other agreements entered into among the parties hereto
and any actions taken or omitted by any party hereunder shall not
affect any rights or obligations of any other party hereunder.
K. The failure of either party to insist upon the performance of any
terms or conditions of this Agreement or to enforce any rights
resulting from any breach of any of the terms or conditions of this
Agreement, including the payment of damages, shall not be construed as
a continuing or permanent waiver of any such terms, conditions, rights
or privileges, but the same shall continue and remain in full force
and effect as if no such forbearance or waiver had occurred.
L. This Agreement constitutes the entire agreement between the parties
hereto and supersedes any prior agreement, draft or agreement or
proposal with respect to the subject matter hereof, whether oral or
written, and this Agreement may not be modified except by written
instrument executed by both parties.
23
WITNESS WHEREOF, the parties have caused this Agreement to be executed by
their respective duly authorized officers.
INVESTORS FIDUCIARY TRUST COMPANY
By: __________________________________
Title: _______________________________
ARIEL GROWTH FUND
By: __________________________________
Title: _______________________________
24
