SPECIAL SERVICING AGREEMENT
THIS SPECIAL SERVICING AGREEMENT ("AGREEMENT"), made as of the 4th day of
September, 2002, by and between X. XXXX PRICE RETIREMENT FUNDS, INC., on behalf
of five of its separate series, X. XXXX PRICE RETIREMENT 2010 FUND, X. XXXX
PRICE RETIREMENT 2020 FUND, X. XXXX PRICE RETIREMENT 2030 FUND, X. XXXX PRICE
RETIREMENT 2040 FUND, and X. XXXX PRICE RETIREMENT INCOME FUND (collectively
hereafter referred to as the "RETIREMENT FUNDS"), EACH FUND LISTED ON APPENDIX A
attached hereto (as such Appendix A may be amended from time to time) and which
evidences its agreement to be bound separately and individually hereby by
executing a copy of this Agreement (such funds hereinafter called the
"UNDERLYING FUNDS"), X. XXXX PRICE SERVICES, INC. ("PRICE SERVICES"), and X.
XXXX PRICE ASSOCIATES, INC. ("PRICE ASSOCIATES").
W I T N E S S E T H:
WHEREAS, the Retirement Funds and each of the Underlying Funds are
registered as open-end, management investment companies under the Investment
Company Act of 1940, as amended ("THE ACT").
WHEREAS, the Retirement Funds, the Underlying Funds, and certain other
funds (the "OTHER FUNDS") sponsored and advised by Price Associates or X. Xxxx
Price International, Inc. ("PRICE INTERNATIONAL") have entered into an agreement
("TRANSFER AGENCY AGREEMENT") with Price Services for the provision of various
transfer agency services in return for such compensation as is set forth
therein;
WHEREAS, the Retirement Funds, the Underlying Funds, and the Other Funds
have entered into an agreement ("RPS AGREEMENT") with X. Xxxx Price Retirement
Plan Services, Inc. ("RETIREMENT PLAN SERVICES"), under which Retirement Plan
Services is to furnish or contract to furnish to the Retirement Funds, the
Underlying Funds, and the Other Funds various participant account,
recordkeeping, and services for retirement plans in return for such compensation
as is set forth therein;
WHEREAS, the Retirement Funds, the Underlying Funds, and the Other Funds
have entered into an agreement ("FUND ACCOUNTING AGREEMENT") with Price
Associates for the provision of various accounting services in return for such
compensation as is set forth therein;
WHEREAS, the Retirement Funds, the Underlying Funds, and the Other Funds
have entered into an agreement ("CUSTODIAN AGREEMENT") with State Street Bank
and Trust Company ("STATE STREET") and/or JPMorgan Chase Bank ("CHASE") under
which State Street and/or Chase are to furnish to the Retirement Funds, the
Underlying Funds, and the Other Funds various custodial services in return for
such compensation as is set forth in the Custodian Agreement;
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WHEREAS, the Retirement Funds have entered into an Investment Management
Agreement with Price Associates for the provision of investment management
services, and under such Agreement, Price Associates will be responsible for the
payment of various the Retirement Funds' expenses, including expenses of the
Retirement Funds' organization, operations, and business not paid for by the
Underlying Funds pursuant to this Agreement;
WHEREAS, the Retirement Funds will provide a means by which the Underlying
Funds can consolidate shareholder accounts in the Underlying Funds;
WHEREAS, such shareholder account consolidation can reduce the fees of the
Underlying Funds due Price Services and Retirement Plan Services under the
Transfer Agency Agreement and RPS Agreement, respectively (such reduction in
expenses hereinafter referred to as "SAVINGS");
WHEREAS, the Retirement Funds will invest their assets exclusively in the
Underlying Funds, except for cash needed for expenses, redemptions, or temporary
defensive purposes; and
WHEREAS, the Board of Directors/Trustees of each of the Underlying Funds
has determined it is reasonable to expect the aggregate expenses as described
below of the Retirement Funds to be less than the estimated Savings to each of
the Underlying Funds from the operation of the Retirement Funds; and such
determination by the Board of Directors/Trustees is reviewed annually prior to
determining whether to renew this Agreement.
NOW, THEREFORE, in consideration of the promises and mutual covenants
spelled out herein, it is agreed between and among the parties hereto as
follows:
1. RETIREMENT FUNDS' EXPENSES
In accordance with the Fund Accounting Agreement, Price Associates will
calculate the amounts of the Retirement Funds' expenses, as set forth in the
Retirement Funds' Investment Management Agreements ("EXPENSES"), due itself,
State Street, Chase, and other persons under the Transfer Agency, RPS, Fund
Accounting, Custodian, and Investment Management Agreements referred to above,
as well as any other amounts due other persons as a result of the Retirement
Funds' operations. However, under unusual circumstances, the parties may agree
to exclude certain amounts from Expenses.
2. UNDERLYING FUNDS' PAYMENT OF EXPENSES
Subject to Paragraph 3, each of the Underlying Funds will bear such Expenses in
proportion to the average daily value of its shares owned by the Retirement
Funds, provided further that no Underlying Fund will bear such Expenses in
excess of the estimated Savings to it ("EXCESS EXPENSE").
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3. PAYMENT BY PRICE ASSOCIATES
In accordance with the Retirement Funds' Investment Management Agreements, Price
Associates agrees that it will bear any Excess Expense described in Paragraph 2.
Payment by Price Associates of any such Excess Expense will be made to the
appropriate Underlying Fund no later than 30 days after the close of the
Underlying Fund's fiscal year.
4. USE OF PRICE NAME
The Retirement Funds may utilize the "X. Xxxx Price" name so long as this
Agreement remains in effect and the assets of the Retirement Funds are invested
solely in shares of the Underlying Funds (except for such cash or cash items as
may be maintained from time to time to meet current expenses and redemptions).
5. RETIREMENT FUNDS' INVESTMENT IN UNDERLYING FUNDS
The Retirement Funds will utilize assets deposited with the custodian of the
Retirement Funds, State Street, from the sale of the Retirement Funds' shares,
to promptly purchase shares of the Underlying Funds, and will undertake
redemption or exchange of such shares of the Underlying Funds in the manner
provided by the objectives and policies of the Retirement Funds.
6. OPINION OF COUNSEL
At any time any of the parties hereto may consult legal counsel in respect of
any matter arising in connection with this Agreement, and no such party shall be
liable for any action taken or omitted by it in good faith in accordance with
such instructions or with the advice or opinion of such legal counsel.
7. LIABILITIES
No party hereto shall be liable to any other party hereto for any action taken
or thing done by it or its agents or contractors in carrying out the terms and
provisions of this Agreement provided such party has acted in good faith and
without negligence or willful misconduct and selected its agents and contractors
with reasonable care.
8. TERM OF AGREEMENT; AMENDMENT; RENEWAL
The term of this Agreement shall begin on September 30, 2002, and unless sooner
terminated as herein provided, the Agreement shall remain in effect through
December 31, 2003. Thereafter, this Agreement shall continue from year to year
if such continuation is specifically approved at least annually by the Board of
Directors/Trustees of each Underlying Fund and the Retirement Funds, including a
majority of the independent Directors/Trustees of each such Fund. In determining
whether to renew this Agreement, the Directors/Trustees of the Underlying Funds
may request, and Price Associates will furnish, such information relevant to
determining the past and future relationship between the Savings and Expenses.
The Agreement may be modified or
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amended from time to time by mutual agreement between the parties hereto. Upon
termination hereof, each party hereto will make appropriate arrangements to
satisfy its obligations hereunder. This Agreement may be amended in the future
to include as additional Fund parties to the Agreement other investment
companies for which Price International or Price Associates serves as investment
manager.
9. ASSIGNMENT
This Agreement shall not be assigned or transferred, either voluntarily or
involuntarily, by operation of law or otherwise, without the prior written
consent of the Underlying Funds and the Retirement Funds. The Agreement shall
automatically and immediately terminate in the event of its assignment without
the prior written consent of such Funds.
10. NOTICE
Any notice under this Agreement shall be in writing, addressed and delivered or
sent by registered or certified mail, postage prepaid, to the other party at
such address as such other party may designate for the receipt of such notices.
Until further notice to the other parties, it is agreed that for this purpose
the address of all parties to this Agreement is 000 Xxxx Xxxxx Xxxxxx,
Xxxxxxxxx, Xxxxxxxx 00000, Attention: Secretary.
11. INTERPRETATIVE PROVISIONS
In connection with the operation of this Agreement, the parties may agree from
time to time on such provisions interpretative of or in addition to the
provisions of this Agreement as may in their joint opinion be consistent with
the general tenor of this Agreement. Any such interpretative or additional
provisions are to be signed by all parties and annexed hereto, but no such
provisions shall contravene any applicable Federal or state law or regulation
and no such interpretative or additional provision shall be deemed to be an
amendment of the Agreement.
12. STATE LAW
This Agreement shall be construed and enforced in accordance with and governed
by the laws of the State of Maryland.
13. CAPTIONS
The captions in the Agreement are included for convenience of reference only and
in no way define or limit any of the provisions hereof or otherwise affect their
construction or effect.
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14. UNDERLYING FUNDS
Each of the Funds listed in Appendix A agree to be bound, separately and
individually, to the terms and conditions of this Agreement. Under no
circumstances will any Underlying Fund be liable for any obligation of any other
Underlying Fund.
IN WITNESS WHEREOF, the parties have caused the Agreement to be executed as
of the day and year first above written.
ATTEST: X. XXXX PRICE RETIREMENT FUNDS, INC.,
on behalf of X. XXXX PRICE RETIREMENT
2010 FUND, X. XXXX PRICE RETIREMENT
2020 FUND, X. XXXX PRICE RETIREMENT
2030 FUND, X. XXXX PRICE RETIREMENT
2040 FUND, and X. XXXX PRICE RETIREMENT
INCOME FUND
/s/Xxxxxxxx X. Xxxxxxx By: /s/Xxxxx X. Xxxxx
Xxxxxxxx X. Xxxxxxx, Secretary Xxxxx X. Xxxxx, President
X. XXXX PRICE ASSOCIATES, INC.
/s/Xxxxxxx X. Xxx Xxxx By: /s/Xxxxx X. Xxxxxxx
Xxxxxxx X. Xxx Xxxx, Secretary Xxxxx X. Xxxxxxx, Vice President
X. XXXX PRICE SERVICES, INC.
/s/Xxxxxxx X. Xxx Xxxx By: /s/Xxxxx X. Hopkins_
Xxxxxxx X. Xxx Xxxx, Secretary Xxxxx X. Xxxxxxx, Vice President
EACH OF THE FUNDS LISTED IN APPENDIX A HERETO, SEPARATELY AND INDIVIDUALLY
/s/Xxxxxxxx X. Xxxxxxx By: /s/Xxxxx X. Xxxxxxx
Xxxxxxxx X. Xxxxxxx, Secretary Xxxxx X. Xxxxxxx, Vice President
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APPENDIX A
X. Xxxx Price Growth Stock Fund, Inc.
X. Xxxx Price High Yield Fund, Inc.
X. Xxxx Price Mid-Cap Growth Fund, Inc.
X. Xxxx Price New Income Fund, Inc.
X. Xxxx Price Short-Term Bond Fund, Inc.
X. Xxxx Price Small-Cap Stock Fund, Inc.
X. Xxxx Price Value Fund, Inc.
X. Xxxx Price Index Trust, Inc., on behalf of the
X. Xxxx Price Equity Index 500 Fund
X. Xxxx Price International Funds, Inc., on behalf of the
X. Xxxx Price International Stock Fund
X. Xxxx Price Summit Funds, Inc., on behalf of the
X. Xxxx Price Summit Cash Reserves Fund
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