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EXHIBIT 99.h-2
TRANSFER AGENCY AGREEMENT
THIS AGREEMENT made as of the 31st day of October, 1999 by and between
Choice Funds, a Delaware business trust (the "Trust"), and Sunstone Financial
Group, Inc., a Wisconsin corporation ("Sunstone"):
WHEREAS, the Trust is registered under the Investment Company Act of
1940, as amended (the "1940 Act"), as an open-end management investment company
and is authorized to issue shares of beneficial interest ("Shares") in separate
series with each such series representing the interests in a separate portfolio
of securities and other assets;
WHEREAS, the Trust desires to retain Sunstone to render the transfer
agency and other services contemplated hereby with respect to each of the
investment portfolios of the Trust as are listed on Schedule A hereto and any
additional investment portfolios the Trust and Sunstone may agree upon and
include on Schedule A as such Schedule may be amended from time to time (such
investment portfolios and any additional investment portfolios are individually
referred to as a "Fund" and collectively the "Funds"), and Sunstone is willing
to render such services.
NOW, THEREFORE, in consideration of the mutual promises and agreements
herein contained and other good and valuable consideration, the receipt of which
is hereby acknowledged, the parties hereto, intending to be legally bound, do
hereby agree as follows:
ARTICLE I
APPOINTMENT OF TRANSFER AGENT
A. APPOINTMENT.
1. The Trust hereby appoints Sunstone as transfer agent and
dividend disbursing agent of all the Shares of the Funds during the period of
this Agreement, and Sunstone hereby accepts such appointment as transfer agent
and dividend disbursing agent and agrees to perform the duties thereof as
hereinafter set forth.
2. Sunstone shall perform the transfer agent and dividend
disbursing agent services described on Schedule B hereto. To the extent that the
Trust requests Sunstone to perform any additional services, Sunstone and the
Trust shall mutually agree as to the services to be accomplished, the manner of
accomplishment and the compensation to which Sunstone shall be entitled with
respect thereto.
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3. Sunstone may, in its discretion, appoint in writing other
parties qualified to perform transfer agency services (each, individually, a
"Sub-transfer Agent"), provided such appointment is approved by a majority of
the Trustees of the Trust, to carry out some or all of its responsibilities
under this Agreement with respect to a Fund; provided, however, that unless the
Trust shall enter into a written agreement with such Sub-transfer Agent, the
Sub-transfer Agent shall be the agent of Sunstone and not the agent of the Trust
and, in such event Sunstone shall be fully responsible for the acts or omissions
of such Sub-transfer Agent and shall not be relieved of any of its
responsibilities hereunder by the appointment of such Sub-transfer Agent.
4. Sunstone shall have no duties or responsibilities whatsoever
hereunder except such duties and responsibilities as are specifically set forth
in this Agreement, and no covenant or obligation shall be implied in this
Agreement against Sunstone.
B. DOCUMENTS/RECORDS.
1. In connection with such appointment, the Trust shall deliver or
cause to be delivered the following documents to Sunstone:
a) A copy of the Declaration of Trust and By-laws of the Trust
and all amendments thereto, and a copy of the resolutions of the Board of
Trustees of the Trust appointing Sunstone and authorizing the execution of this
Transfer Agency Agreement on behalf of the Funds, each certified by the
Secretary of the Trust;
b) A certificate signed by the President and Secretary of the
Trust specifying: the number of authorized Shares and the number of such
authorized Shares issued and currently outstanding, if any; and the individuals
authorized to provide oral instructions and to sign written instructions and
requests on behalf of the Trust (hereinafter referred to as "Authorized
Persons") and to change the persons authorized to provide such instructions from
time to time, it being understood Sunstone shall not be held to have notice of
any change in the authority of any Authorized Person until receipt of written
notice thereof from the Trust;
d) Copies of the Trust's Registration Statement, as amended to
date, and the most recently filed Pre- or Post-Effective Amendment thereto,
filed by the Trust with the Securities and Exchange Commission under the
Securities Act of 1933, as amended (the "1933 Act"), and under the 1940 Act, as
amended, together with any applications filed in connection therewith; and
e) Opinion of counsel for the Trust with respect to the Trust's
organization and existence under the laws of its state of organization, the
validity of the authorized and outstanding Shares, whether such Shares are fully
paid and non-assessable and the status of such Shares under the Securities Act
of 1933, as amended, and any other applicable federal law or regulation (i.e.,
if subject to registration, that they have been registered and that the
Registration Statement has become effective or, if exempt, the specific grounds
therefor.)
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2. The Trust agrees to deliver or to cause to be delivered to
Sunstone in Milwaukee, Wisconsin, at the Trust's expense, all of its shareholder
account records relating to the Funds in a format acceptable to Sunstone and all
such other documents, records and information as Sunstone may reasonably request
in order for Sunstone to perform its services hereunder.
ARTICLE II
COMPENSATION & EXPENSES
A. COMPENSATION. In consideration for its services hereunder as
transfer agent and dividend disbursing agent, each Fund will pay to Sunstone
such compensation as set forth in Schedule C attached hereto.
B. EXPENSES. The Trust on behalf of each Fund also agrees to promptly
reimburse Sunstone for all out-of-pocket expenses or disbursements incurred by
Sunstone in connection with the performance of services under this Agreement
including, but not limited to, expenses for postage, express delivery services,
freight charges, envelopes, checks, drafts, forms (continuous or otherwise),
specially requested reports and statements, bank account service fees and
charges, telephone calls, telegraphs, stationery supplies, outside printing and
mailing firms, magnetic tapes, reels or cartridges (if sent to a Fund or to a
third party at a Fund's request) and magnetic tape handling charges, on-site and
off-site record storage, media for storage of records (e.g., microfilm,
microfiche, optical platters, computer tapes and disks), computer equipment
installed at a Fund's request at a Fund's or a third party's premises,
telecommunications equipment, telephone/telecommunication lines between the
Trust and its agents, on one hand, and Sunstone on the other, proxy soliciting,
processing and/or tabulating costs, second site back-up computer facility,
transmission of statement data for remote printing or processing, and
transaction fees to the extent any of the foregoing are paid by Sunstone. If
requested by Sunstone, postage and other out-of-pocket expenses are payable in
advance, and in the event requested, postage is due at least seven days prior to
the anticipated mail date. In the event Sunstone requests advance payment,
Sunstone shall not be obligated to incur such expenses or perform the related
service(s) until payment is received.
C. PAYMENT PROCEDURES.
1. Amounts due hereunder shall be due and paid by the respective
Fund on or before the 15th day after the date of the statement therefor (the
"Due Date"). Service fees are billed monthly, and out-of-pocket expenses are
billed as incurred (unless prepayment is requested by Sunstone). Sunstone may,
at its option, arrange to have various service providers submit invoices
directly to the Funds for payment of out-of-pocket expenses reimbursable
hereunder. The Trust is aware that its failure to pay all amounts in a timely
fashion so that they will be received by Sunstone on or before the Due Date will
give rise to costs to Sunstone not contemplated by this Agreement, including but
not limited to carrying, processing and accounting charges. Accordingly, in the
event that any amounts due hereunder are not received
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by Sunstone by the Due Date, the Trust shall pay a late charge equal to one and
one-half percent (1.5%) per month or the maximum amount permitted by law,
whichever is less. In addition, the Trust shall pay reasonable attorney's fees
and court costs of Sunstone if any amounts due Sunstone are collected by or
through an attorney. 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 a Fund's default or prevent Sunstone from
exercising any other rights and remedies available to it.
ARTICLE III
PROCESSING AND PROCEDURES
A. ISSUANCE, REDEMPTION AND TRANSFER OF SHARES
1. Sunstone acknowledges that it has received a copy of each
Fund's Prospectus (as hereinafter defined), which Prospectus describes how sales
and redemptions of shares of each Fund shall be made and Sunstone agrees to
accept purchase orders and redemption requests with respect to Fund shares on
each Fund Business Day in accordance with such Prospectus. "Fund Business Day"
shall be deemed to be each day on which the New York Stock Exchange is open for
trading, and "Prospectus" shall mean the last Fund prospectus actually received
by Sunstone from the Fund with respect to which the Fund has indicated a
registration statement under the 1933 Act has become effective, including the
Statement of Additional Information, incorporated by reference therein.
2. On each Fund Business Day Sunstone shall, as of the time at
which the net asset value of each Fund is computed, issue to and redeem from the
accounts specified in a purchase order or redemption request in proper form and
accepted by the Trust, which in accordance with the Prospectus is effective on
such Fund Business Day, the appropriate number of full and fractional Shares
based on the net asset value per Share of the respective Fund specified in an
advice received on such Fund Business Day from or on behalf of the Fund.
3. Upon the issuance of any Shares in accordance with this
Agreement, Sunstone shall not be responsible for the payment of any original
issue or other taxes required to be paid by the Fund in connection with such
issuance of any Shares.
4. Sunstone shall not be required to issue any Shares after it has
received from an Authorized Person or from an appropriate federal or state
authority written notification that the sale of Shares has been suspended or
discontinued, and Sunstone shall be entitled to rely upon such written
notification.
5. Upon receipt of a redemption request and monies paid to it by
the Fund's custodian bank ("Custodian") in connection with a redemption of
Shares, Sunstone shall cancel
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the redeemed Shares and after making appropriate deduction for any withholding
of taxes required of it by applicable law, make payment in accordance with the
Fund's redemption and payment procedures described in the Prospectus.
6. (a) Except as otherwise provided in sub-paragraph (b) of this
paragraph, Shares will be transferred or redeemed upon presentation to Sunstone
of instructions in good order endorsed for exchange, transfer or redemption,
accompanied by such documents as Sunstone deems necessary to evidence the
authority of the person making such transfer or redemption, and bearing
satisfactory evidence of the payment of stock transfer taxes. Sunstone reserves
the right to refuse to transfer or redeem Shares until it is satisfied that the
endorsement on the stock certificate, if any, or instructions is valid and
genuine, and for that purpose it will require, unless otherwise instructed by an
Authorized Person or except as provided in sub-paragraph (b) of this paragraph,
a guarantee of signature by an "Eligible Guarantor Institution" as that term is
defined by SEC Rule 17Ad-15(a)(2) of the Securities Exchange Act of 1934, as
amended. Sunstone 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 shall incur no liability for the refusal, in good faith, to
make transfers or redemptions which Sunstone, in its judgment, deems improper or
unauthorized, or until it is satisfied that there is no reasonable basis to any
claims adverse to such transfer or redemption. Sunstone may, in effecting
transfers and redemptions of Shares, rely upon those provisions of the Uniform
Act for the Simplification of Fiduciary Security Transfers or the Uniform
Commercial Code, as the same may be amended from time to time, applicable to the
transfer of securities, and shall not be responsible for any act done or omitted
by it in good faith in reliance upon such laws.
(b) Notwithstanding the foregoing or any other provision
contained in this Agreement to the contrary, Sunstone shall be fully protected
by each Fund in not requiring any instruments, documents, assurances,
endorsements or guarantees, including, without limitation, any signature
guarantees, in connection with a redemption, exchange or transfer, of Shares
whenever Sunstone reasonably believes that requiring the same would be
inconsistent with the transfer and redemption procedures as described in the
Fund's Registration Statement and/or in certified resolutions of the Board of
Trustees of the Trust provided to Sunstone.
7. Notwithstanding any provision contained in this Agreement to
the contrary, Sunstone shall not be required or expected to require, as a
condition to any transfer or redemption of any Shares pursuant to a computer
tape or electronic data transmission, any documents to evidence the authority of
the person requesting the transfer or redemption and/or the payment of any stock
transfer taxes, and shall be fully protected in acting in accordance with the
applicable provisions of this Article.
8. In connection with each purchase and each redemption of Shares,
Sunstone shall send such statements as are prescribed by the Federal securities
laws applicable to transfer agents or as described in the Prospectus. It is
understood that certificates for Shares will not be offered by the Trust or
available to investors.
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9. Procedures for effecting purchase, redemption or transfer
transactions accepted from investors by telephone or other related methods shall
be established by mutual agreement between the Trust and Sunstone consistent
with the terms of the Prospectus and such rules and regulations generally
adopted by mutual fund transfer agents. At any time, Sunstone may request
instructions from the Trust with respect to any matter arising in connection
with the foregoing procedures. If such instructions are not received within a
reasonable time, then Sunstone may seek advice from legal counsel for the Trust,
or its own legal counsel at the expense of the Trust. Sunstone shall not be
liable, and shall be held harmless by the Trust, for any action taken or
omissions which are consistent with the foregoing procedures, or for any action
taken or omitted by it in good faith in reliance upon such instructions or in
accordance with advice of counsel.
10. Prior to the effective date of any increase or decrease in the
total number of Shares authorized to be issued, or the issuance of any
additional Shares of a Fund pursuant to stock dividends, stock splits,
recapitalizations, capital adjustments or similar transactions, the Trust agrees
to deliver to Sunstone such documents, certificates, reports and legal opinions
as Sunstone may reasonably request.
B. DIVIDENDS AND DISTRIBUTIONS.
1. The Trust shall furnish to Sunstone a copy of a resolution of
its Board of Trustees, certified by an Authorized Person, either (i) setting
forth the date of the declaration of a dividend or distribution, the date of
accrual or payment, as the case may be, thereof, the record date as of which
shareholders entitled to payment, or accrual, as the case may be, shall be
determined, the amount per Share of such dividend or distribution, the payment
date on which all previously accrued and unpaid dividends are to be paid, and
the total amount, if any, payable to Sunstone on such payment date, or (ii)
authorizing the declaration of dividends and distributions on a daily or other
periodic basis and authorizing Sunstone to rely on a certificate of an
Authorized Person setting forth the information described in subsection (i) of
this paragraph.
2. In connection with a reinvestment of a dividend or distribution
of Shares of a Fund, Sunstone shall as of each Fund Business Day, as specified
in a certificate or resolution described in paragraph 1, issue Shares of the
Fund based on the net asset value per Share of such Fund specified in an advice
received from or on behalf of the Fund on such Fund Business Day.
3. Upon the mail date specified in such certificate or resolution,
as the case may be, the Trust shall, in the case of a cash dividend or
distribution, cause the Custodian to deposit in an account in the name of
Sunstone on behalf of a Fund, an amount of cash, if any, sufficient for Sunstone
to make the payment, as of the mail date, specified in such Certificate or
resolution, as the case may be, to the Shareholders who were of record on the
record date. Sunstone will, upon receipt of any such cash, make payment of such
cash dividends or distributions to the shareholders of record as of the record
date. Sunstone shall not be liable for any improper payments made in accordance
with a certificate or resolution described in the preceding paragraph. If
Sunstone shall not receive from the Custodian sufficient cash to make payments
of any cash dividend or distribution to all shareholders of the Fund as of the
record date, Sunstone
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shall, upon notifying the Fund, withhold payment to all shareholders of record
as of the record date until sufficient cash is provided to Sunstone.
4. It is understood that Sunstone in its capacity as transfer
agent and dividend disbursing agent shall in no way be responsible for the
determination of the rate or form of dividends or capital gain distributions due
to the shareholders pursuant to the terms of this Agreement. It is further
understood that Sunstone shall file with the Internal Revenue Service and
shareholders such appropriate federal tax forms concerning the payment of
dividend and capital gain distributions but shall in no way be responsible for
the collection or withholding of taxes due on such dividends or distributions
due to shareholders, except and only to the extent, required by applicable
federal law.
C. RECORDS.
1. Sunstone shall keep such records as are specified in Schedule D
hereto in the form and manner, and for such period, as it may deem advisable but
not inconsistent with the rules and regulations of appropriate government
authorities, in particular Rules 31a-2 and 31a-3 under the 1940 Act. Sunstone
may deliver to the Trust from time to time at Sunstone's discretion, for
safekeeping or disposition by the Trust in accordance with law, such records,
papers and documents accumulated in the execution of its duties as such transfer
agent, as Sunstone may deem expedient, other than those which Sunstone is itself
required to maintain pursuant to applicable laws and regulations. The Trust
shall assume all responsibility for any failure thereafter to produce any such
record, paper, canceled Share certificate, or other document so returned, if and
when required. To the extent required by Section 31 of the 1940 Act and the
rules and regulations thereunder, the records specified in Schedule D hereto
maintained by Sunstone, which have not been previously delivered to the Trust
pursuant to the foregoing provisions of this paragraph, shall be considered to
be the property of the Trust, shall be made available upon request for
inspection by the officers, employees, and auditors of the Trust, and shall be
delivered to the Trust promptly upon request and in any event upon the date of
termination of this Agreement, in the form and manner kept by Sunstone on such
date of termination or such earlier date as may be requested by the Trust.
2. Sunstone agrees to keep all records and other information
relative to the Trust, the Funds and their shareholders confidential. In case of
any requests or demands for the inspection of the shareholder records of a Fund,
Sunstone will use its best efforts to notify the Fund promptly and to secure
instructions from an Authorized Person as to such inspection. Sunstone reserves
the right, however, to exhibit the shareholder records to any person whenever it
believes there is a reasonable likelihood that Sunstone will be held liable for
the failure to exhibit the shareholder records to such person; provided,
however, that in connection with any such disclosure Sunstone shall promptly
notify the Trust, where reasonably possible, that such disclosure has been made
or is about to be made in order to give the Trust an opportunity to take
remedial steps to block such disclosure. Notwithstanding the foregoing, Sunstone
may disclose information when requested by a shareholder concerning an account
as to which such shareholder claims a legal or beneficial interest or when
requested by the Trust, the shareholder or the dealer of record as to such
account.
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ARTICLE IV
CONCERNING THE TRUST
A. REPRESENTATIONS. The Trust represents and warrants to Sunstone
that:
(a) It is a business trust duly organized and existing under the
laws of the State of Delaware, it is empowered under applicable laws and by its
Declaration of Trust 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.
(b) It is an investment company registered under the 1940 Act.
(c) A registration statement under the 1933 Act with respect to
the Shares is effective. The Trust shall notify Sunstone if such registration
statement or any state securities registrations have been terminated, lapse or a
stop order has been entered with respect to the Shares.
B. COVENANTS.
1. The Trust will provide to Sunstone copies of all amendments to
its Declaration of Trust and By-laws made after the date of this Agreement. If
requested by Sunstone, each copy of the Declaration of Trust and By-laws of the
Trust and copies of all amendments thereto shall be certified by the Secretary
of the Trust.
2. The Trust shall deliver to Sunstone the Fund's currently
effective Prospectus and, for purposes of this Agreement, Sunstone shall not be
deemed to have notice of any information contained in such Prospectus until a
reasonable time (not to exceed three business days) after it is actually
received by Sunstone.
3. All requisite steps will be taken by the Trust from time to
time when and as necessary to register the Trust's shares for sale in all states
in which Trust shares shall at the time be offered for sale and require
registration. If at any time the Trust receives notice of any stop order or
other proceeding in any such state affecting such registration or the sale of
Trust shares, or of any stop order or other proceeding under the federal
securities laws affecting the sale of Trust shares, the Trust will give prompt
notice thereof to Sunstone.
4. The Trust will comply with all applicable requirements of the
1933 Act, the Securities Exchange Act of 1934, as amended, the 1940 Act, blue
sky laws, and any other applicable laws, rules and regulations.
5. The Trust agrees that prior to effecting any change in the
Prospectus which would increase or alter the duties and obligations of Sunstone
hereunder, it shall advise Sunstone of such proposed change at least 30 days
prior to the intended date of the same, and shall proceed
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with such change only if it shall have received the written consent of Sunstone
thereto, which shall not be unreasonably withheld.
ARTICLE V
CONCERNING THE TRANSFER AGENT
A. REPRESENTATIONS. Sunstone represents and warrants to the Fund
that:
(a) It is a corporation duly organized and existing under the laws
of the State of Wisconsin, is empowered under applicable law and by its Articles
of Incorporation and By-laws to enter into and perform this Agreement, and all
requisite proceedings have been taken to authorize it to enter into and perform
this Agreement.
(b) It is duly registered as a transfer agent under Section 17A of
the Securities Exchange Act of 1934, as amended, to the extent required.
(c) To the extent it deems necessary, it (a) has reviewed its
business and operations as they relate to the services provided hereunder, (b)
has developed or is developing a program to remediate or replace computer
applications and systems, and (c) has developed a testing plan to test where
reasonably feasible the remediation or replacement of computer
applications/systems, in each case, to address on a timely basis the risk that
certain computer applications/systems used by Sunstone may be unable to
recognize and properly perform date sensitive functions involving dates prior
to, including and after December 31, 1999, including dates such as February 29,
2000. To Sunstone's knowledge and belief, its proprietary systems are Year 2000
compliant in all material respects with regard to the services to be provided
under this Agreement.
B. LIMITATION OF LIABILITY; INDEMNIFICATION.
1. Sunstone shall not be liable for any loss or damage, including
counsel fees, resulting from its actions or omissions to act or otherwise, in
the absence of its bad faith, willful misfeasance, gross negligence or reckless
disregard of its duties under this Agreement. Sunstone shall not be liable in
acting upon any writing, document or instructions believed by it to be genuine
and to have been signed or made by an Authorized Person or verbal instructions
which the individual receiving the instructions on behalf of Sunstone believes
to have been given by an Authorized Person, and Sunstone shall not be held to
have any notice of any change of authority of any person until receipt of
written notice thereof from a Fund or such person.
2. The Trust on behalf of the Funds agrees to indemnify and hold
harmless Sunstone, its employees, agents, members, officers and nominees from
and against any and all claims, demands, actions and suits, whether groundless
or otherwise, and from and against any and all judgments, liabilities, losses,
damages, costs, charges, counsel fees and other expenses of every nature and
character arising out of or in any way relating to Sunstone's actions taken or
nonactions with respect to the performance of services under this Agreement or
based, if applicable, upon reliance on information, records, instructions (oral
or written) or requests given
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or made to Sunstone by the Funds, its officers, directors, agents or
representatives; provided that this indemnification shall not apply to actions
or omissions of Sunstone in cases of its own willful misfeasance or gross
negligence, and further provided that prior to confessing any claim against it
which may be the subject of this indemnification, Sunstone shall give the Funds
written notice of and reasonable opportunity to defend against said claim in its
own name or in the name of Sunstone. The indemnity and defense provisions
provided hereunder shall indefinitely survive the termination of this Agreement.
3. Sunstone assumes no responsibility hereunder, and shall not be
liable, for any damage, loss of data, errors, delay or any other loss whatsoever
caused by events beyond its reasonable control. Sunstone will, however, take all
reasonable steps to minimize service interruptions for any period that such
interruption continues beyond Sunstone's control.
4. 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 any act or failure to act under
any provision of this Agreement even if advised of the possibility thereof.
5. Notwithstanding any of the provisions of this Agreement,
Sunstone shall be under no duty or obligation under this Agreement to inquire
into, and shall not be liable for:
(a) The legality of the issue or sale of any Shares, the
sufficiency of the amount to be received therefor, or the authority of a Fund,
as the case may be, to request such sale or issuance;
(b) The legality of a transfer of Shares, or of a redemption of
any Shares, the propriety of the amount to be paid therefor, or the authority of
a Fund, as the case may be, to request such transfer or redemption;
(c) The legality of the declaration of any dividend by a Fund,
or the legality of the issue of any Shares in payment of any stock dividend, or
the legality of any recapitalization or readjustment of Shares.
ARTICLE VI
TERM
1. This Agreement shall remain in full force and effect until
____________, 199_, (the "Initial Term") and thereafter shall automatically
extend for additional, successive twelve (12) month terms unless earlier
terminated as provided below.
2. Either of the parties hereto may terminate this Agreement at
any time after the Initial Term by giving to the other party a notice in writing
specifying the date of such termination, which shall be not less than ninety
(90) days after the date of receipt of such notice.
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In the event such notice is given by a Fund, it shall be accompanied by a copy
of a resolution of the Board of Trustees of the Trust, certified by the
Secretary or any Assistant Secretary, electing to terminate this Agreement and
designating the successor transfer agent or transfer agents. In the event such
notice is given by Sunstone, the Fund shall on or before the termination date,
deliver to Sunstone a copy of a resolution of its Board of Trustees certified by
the Secretary or any Assistant Secretary designating a successor transfer agent
or transfer agents. In the absence of such designation by the Fund, the Fund
shall upon the date specified in the notice of termination of this Agreement and
delivery of the records maintained hereunder, be deemed to be its own transfer
agent and Sunstone shall thereby be relieved of all duties and responsibilities
pursuant to this Agreement. Fees and out-of-pocket expenses incurred by
Sunstone, but unpaid by a Fund upon such termination, shall be immediately due
and payable upon and notwithstanding such termination.
3. In the event this Agreement is terminated as provided herein,
Sunstone, upon the written request of the Trust, shall deliver the records of
the Trust to the Trust or its successor transfer agent in the form maintained by
Sunstone at the expense of the Trust. The Trust shall be responsible to Sunstone
for all out-of-pocket expenses and for the costs and expenses associated with
the preparation and delivery of such media, including: (a) any custom
programming requested by Trust in connection with the preparation of such media;
(b) transportation of forms and other materials used in connection with the
processing of Fund transactions by Sunstone; and (c) transportation of records
and files in the possession of Sunstone. Sunstone shall not reduce the level of
service provided to the Trust following notice of termination by the Trust.
ARTICLE VII
MISCELLANEOUS
A. NOTICES. Any notice required or permitted by Article VI to be given by
either party to the other shall be in writing and shall be deemed to have been
given when sent by registered or certified mail, postage prepaid, return receipt
requested, as follows: Notice to Sunstone shall be sent to Sunstone Financial
Group, Inc., at 000 Xxxx Xxxxxxx Xxxxxx, Xxxxx 000, Xxxxxxxxx, Xxxxxxxxx 00000,
Attention President, or at such other place as Sunstone may from time to time
designate in writing, and notice to the Trust shall be sent to
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B. AMENDMENTS/ASSIGNMENTS.
1. This Agreement may not be amended or modified in any manner
except by a written agreement executed by both parties with the formality of
this Agreement.
2. This Agreement shall extend to and shall be binding upon the
parties hereto, and their respective successors and assigns. This Agreement
shall not be assignable by either party without the written consent of the other
party except that Sunstone may assign this Agreement to an affiliate with
advance written notice to the Trust.
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C. WISCONSIN LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Wisconsin. 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
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.
D. COUNTERPARTS. This Agreement may be executed in any number of
counterparts each of which shall be deemed to be an original; but such
counterparts shall, together, constitute only one instrument.
E. NON-EXCLUSIVE; OTHER AGREEMENTS. The services of Sunstone hereunder
are not deemed exclusive and Sunstone shall be free to render similar services
to others. 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.
F. CAPTIONS. 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.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective corporate officer, thereunto duly authorized and
their respective corporate seals to be hereunto affixed, as the day and year
first above written.
SUNSTONE FINANCIAL GROUP, INC. CHOICE FUNDS
By: By:
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(Signature) (Signature)
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(Name) (Name)
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(Title) (Title)
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(Date Signed) (Date Signed)
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SCHEDULE A
TO
TRANSFER AGENCY AGREEMENT
NAMES OF FUNDS
Choice Balanced Fund
Choice Focus Fund
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SCHEDULE B
TO
TRANSFER AGENCY AGREEMENT
SERVICE SCHEDULE
SERVICES
- Set up and maintain shareholder accounts and records, including IRAs and
other retirement accounts
- Store account documents electronically
- Receive and respond to investor account inquiries by telephone, mail, or
e-mail, if desired
- Process purchase and redemption orders, transfers, and exchanges, including
automatic purchases and redemptions
- Process dividend payments by check, wire or ACH, or reinvest dividends
- Issue daily transaction confirmations and monthly or quarterly statements
- Mail prospectus, annual and semiannual reports, and other shareholder
communications to existing shareholders
- File IRS Forms 1099, 5498, 1042, 1042-S and 945 with shareholders and/or the
IRS
- Handle load and multi-class processing, including rights of accumulation and
purchases by letters of intent
- Calculate 12b-1 plan fees
- Give dealers access through NSCC's Fund/SERV and Networking
- Provide standards to structure forms and applications for efficient
processing
OPTIONAL SERVICES
The Funds may contract with Sunstone to provide one or more of the following
optional services. Additional fees apply.
- Personal follow-up calls to prospects who return incomplete applications
- Comprehensive clerical confirmation statements for maintenance transactions
- 0.XXX SERVICES, Sunstone's array of Internet services, including Adviser
Services, RIA/Broker Services, Shareholder Services, NAV Services and email
services.
- Average cost calculations and cost basis statements
- Shareholder "welcome" packages with initial confirmation
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- Access to Sunstone's Tax and Retirement Group to answer questions and
coordinate retirement plan options
- Follow up on IRAs, soliciting beneficiary and other information and sending
required minimum distribution reminder letters
- Money market funds for short-term investment or exchanges
- Dedicated service representatives
- Weekend shareholder services
- Customized reorder form tracking
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SCHEDULE C
TO
TRANSFER AGENCY AGREEMENT
FEE SCHEDULE
SERVICES
The following fees are charged for standard shareholder services:
BASE FEES
- Open account fee (per year)
- No load equity and non-daily accrual fixed income funds $8.50
- Additional for 12b-1 fee $0.75
- Additional for front-end load $1.50
- Additional for CDSC or back-end load $2.00
- Money market and daily accrual fixed income funds $11.00
- Additional for 12b-1 fee $0.75
- Additional for front-end load $1.50
- Additional for CDSC or back-end load $2.00
- Closed account fee (per year) $3.00
- Monthly base (per fund)
- One to three funds in fund family $1,500
- 4 or more funds in fund family $1,000
- Add for multiclass (per class) 25%
ACCOUNT MAINTENANCE FEES (PER OCCURRENCE)
- New account set up $3.00
- Financial transactions $1.50
- Maintenance transactions $1.00
- Research/correspondence $2.50
- Transfer on death (XXX) set-up $7.50
- Fund/SERV
- Initial set-up per fund family $3,500
- Set-up fee per subsequent CUSIP $1,000
- New account set-up $1.00
- Per transaction - no load fund $0.25
- Per transaction - load fund $0.35
- Adjustments and rebills $2.50
- Fund/SERV direct charges at cost
- Commission/SERV (per check) $0.25
- ACH/AIP/SWP/automatic exchanges
- Set-up $1.00
- Per transaction $0.25
- Withholding per eligible account per year $0.25
- Account transcripts older than 2 years
(may be charged to shareholders) $5.00
- Locating lost shareholders $8.00
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- Postal clean up per account $3.00
- Tax ID number solicitation $2.50
SHAREHOLDER SERVICING FEES
- Telephone calls (per call) $2.50
- Annual maintenance per omnibus account $150
TAX AND RETIREMENT FEES
- Retirement accounts (XXX/Xxxx/others)
- Annual maintenance per account (may be
charged to shareholders) $12.50
- Account distribution (may be charged to shareholders) $12.50
- XXX transfer/rollover $7.50
DOCUMENT SERVICES
- Per statement, confirmation and check processing $0.25
- Per tax form processing $0.25
- Per label printing for proxy or marketing purposes $0.10
- Bulk mailings/insert handling charge
- 1 insert $0.06
- 2 - 3 inserts $0.08
- 4 or more inserts as quoted
- Production of ad hoc reports starting at $100
SUNSTONE OFFERED MONEY MARKET EXCHANGE VEHICLES
- One-time set up per money market fund used $2,000
- Monthly base fee per money market fund used $650
- Money market checkbooks at cost
- Signature verification of check writing $2.00
FORMS AND APPLICATIONS
- Standard applications and forms with custom logo $1,500 plus printing
- Customized forms as quoted
SUNSTONE 4.PROMPTSM SERVICES (MONTHLY FEES)
- Automated Account Information and Prospectus Service
- Monthly maintenance fee $350
- One time set up fee $3,750
REPROCESSINGS DUE TO NAV ERRORS
This charge applies when shareholder transactions are required to be reprocessed
as a result of NAV errors caused by the adviser or fund accountant unaffiliated
with Sunstone. This charge is not a fund expense and is billed to the adviser.
- Base fee (per occurrence, per day, per fund) $750
- Transaction fee $1.00
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FUND/SERV ACCESS
- Use of Sunstone Fund/SERV membership (per fund/per year)
- First three funds in fund family $2,000
- 4 or more funds $1,000
CUSTOM PROGRAMMING
Additional fees at $150 per hour or quoted by project may apply for special
programming to meet your servicing requirements or to create custom reports.
PREMIUM SERVICES
Certain premium services described on Exhibit B may be purchased on an as-needed
basis. Fees for premium services will be based on Sunstone's current rate at the
time services are purchased.
OUT-OF-POCKET EXPENSES
DOCUMENT CHARGES
- Copying charges (per page) $0.15
- Facsimile charges (per fax) $1.25
- Inventory and records storage $20.00/pallet
SUPPLIES AND SERVICES
- Statement paper, check stock, envelopes, tax forms at cost
- Postage and express delivery charges at cost
- Tape/disk storage at cost
- Telephone and long distance at cost
- P.O. box rental at cost
- Toll-free number at cost
BANK CHARGES
- Bank account service fees and any other bank charges at cost
- Outgoing wire fee varies by bank
- Non-sufficient funds varies by bank
- Stopped check on money market funds $25.00
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SCHEDULE D
RECORDS MAINTAINED BY SUNSTONE
Account applications
Canceled certificates plus stock powers and supporting documents
Checks including check registers, reconciliation records, any adjustment records
and tax withholding documentation
Indemnity bonds for replacement of lost or missing stock certificates and checks
Liquidation, redemption, withdrawal and transfer requests including stock
powers, signature guarantees and any supporting documentation
Shareholder correspondence
Shareholder transaction records
Share transaction history of the Funds
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