TRANSFER AGENCY AGREEMENT
AGREEMENT dated as of September 24, 2003, between Integrity Managed
Portfolios (the "Fund"), a Massachusetts business trust, having its principal
office and place of business at #0 Xxxx Xxxxxx Xxxxx, Xxxxx, Xxxxx Xxxxxx
00000, and Integrity Fund Services, Inc. (the "Transfer Agent"), a corporation
organized under the laws of the State of North Dakota with its principal place
of business at #0 Xxxx Xxxxxx Xxxxx, Xxxxx, Xxxxx Xxxxxx 00000.
WITNESSETH:
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That for and in consideration of the mutual promises hereinafter set forth,
the Fund and the Transfer Agent agree as follows:
Definitions.
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Whenever used in this Agreement, the following words and phrases,
unless the context otherwise requires, shall have the following meanings:
(a) "Authorized Person" shall be deemed to include the President, the
Vice President, the Secretary, and the Treasurer of the Fund, the persons
listed in Appendix A hereto, and any other person, whether or not such person
is an officer of the Fund, duly authorized to give Oral Instructions or Written
Instructions on behalf of the Fund as indicated in a certificate furnished to
the Transfer Agent pursuant to Section 5(d) or 5(e) hereof as may be received
by the Transfer Agent from time to time.
(b) "Commission" shall have the meaning given it in the 1940 Act.
(c) "Custodian" refers to the custodian and any sub-custodian of all
securities and other property which the Fund may from time to time deposit or
cause to be deposited or held under the name or account of such custodian.
(d) "Declaration of Trust" shall mean the Fund's Declaration of Trust as
now in effect and as the same may be amended from time to time.
(e) "Officer" shall mean the President, Vice President, Secretary, and
Treasurer of the parties hereto.
(t) "Oral Instructions" shall mean instructions, other than written
instructions, actually received by the Transfer Agent from a person reasonably
believed by the Transfer Agent to be an Authorized Person.
(g) "Prospectus" shall mean any current prospectus and statement of
additional information relating to the registration of the Fund's shares under
the Securities Act of 1933, as amended, and the 1940 Act.
(h) "Shares" refers to the units into which the shareholders'
proprietary interests in the Fund are divided.
(i) "Shareholder" means a record owner of Shares.
(j) "Trustees" or "Board of Trustees" refers to the duly elected
Trustees of the Fund.
(k) "Written Instructions" shall mean a written or electronic communication
actually received by the Transfer Agent from an Authorized Person or from a
person reasonably believed by the Transfer Agent to be an Authorized Person by
telex or any other such system whereby the receiver of such communication is
able to verify through codes or otherwise with a reasonable degree of certainty
the authenticity of the sender of such communications.
(1) The "1940 Act" refers to the Investment Company Act of 1940, and the
Rules and Regulations promulgated thereunder, all as amended from time to time.
2. Appointment of the Transfer Agent.
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The Fund hereby appoints and constitutes the Transfer Agent as transfer
agent for its Shares and as Shareholder servicing agent, and the Transfer Agent
accepts such appointment and agrees to perform the duties hereinafter set
forth.
3. Compensation.
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(a) The Fund will compensate the Transfer Agent for the performance of its
obligations hereunder in accordance with the fees set forth in the written
schedule of fees annexed hereto as Schedule A and incorporated herein.
The Transfer Agent will xxxx the Fund as soon as practicable after the
end of each calendar month, and said xxxxxxxx will be detailed in accordance
with the Schedule A. The Fund will promptly pay to the Transfer Agent the
amount of such billing.
(b) Any compensation agreed to hereunder may be adjusted from time to time
upon mutual agreement by both parties hereto by attaching to Schedule A of
this Agreement a revised Fee Schedule, dated and signed by an Officer of each
party hereto.
4. Documents.
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In connection with the appointment of the Transfer Agent, the Fund
shall, on or before the date this Agreement goes into effect, but in any
case, within a reasonable period of time for the Transfer Agent to prepare
to perform its duties hereunder, furnish the Transfer Agent with the
following documents:
(a) A certified copy of the Fund's Declaration of Trust, as amended.
(b) A certified copy of the Fund's Bylaws, as amended.
(c) A copy of the resolution of the Trustees authorizing execution and
delivery of this Agreement.
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(d) If applicable, a specimen of the certificate for Shares of the Fund in
the form approved by the Trustees, with a certificate of the Secretary of the
Fund as to such approval.
(e) All account application forms and other documents relating to
Shareholder accounts or to any plan, program, or service offered by the Fund.
5. Further Documentation.
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The Fund will also furnish from time to time the following documents:
(a) The Fund's Registration Statement and each subsequent amendment to the
Fund's Registration Statement that is filed with the Commission.
(b) Certificates as to any change in any Officer, Trustee, or Investment
Adviser of the Fund.
(c) Such other certificates, documents, or opinions as the Transfer Agent
deems to be appropriate or necessary for the proper performance of its duties
hereunder.
6. Representations of the Fund.
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The Fund represents to the Transfer Agent that Shares will be issued in
accordance with the terms of the Declaration of Trust and the Prospectus and
that such Shares shall be validly issued, fully paid, and non-assessable by
the Fund.
In the event that the Trustees shall declare a distribution payable in
Shares, the Fund shall deliver to the Transfer Agent written notice of such
declaration signed on behalf of the Fund by an Officer of the Fund, upon
which the Transfer Agent shall be entitled to rely for all purposes,
certifying (i) the number of Shares involved, (ii) that all appropriate
action has been taken, and (iii) that any amendment to the Declaration of
Trust which may be required has been filed and is effective. Such notice
shall be accompanied by an opinion of counsel for the Fund relating to the
legal adequacy and effect of the transaction. This provision shall not apply
to Shares to be issued in the normal course of reinvestment of any
distributions or dividends in accordance with the Fund's Prospectus.
7. Duties of the Transfer Agent.
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The Transfer Agent shall be responsible for administering and/or
performing transfer agent functions; for acting as service agent in
connection with dividend and distribution functions; and for performing
Shareholder account and administrative agent functions in connection with the
issuance, transfer, and redemption or repurchase (including coordination with
the Custodian) of Shares. The operating standards and procedures to be
followed shall be determined from time to time by agreement between the
Transfer Agent and the Fund and shall be expressed in a written schedule of
duties of the Transfer Agent annexed hereto as Schedule B and incorporated
herein.
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8. Recordkeeping and Other Information.
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The Transfer Agent shall create and maintain all necessary records in
accordance with all applicable laws, rules and regulations, including, but
not limited to, records required by Section 31(a) of the 1940 Act and those
records pertaining to the various functions performed by it hereunder which
are set forth in Schedule B hereto. All records shall be available during
regular business hours for inspection and use by the Fund. Where applicable,
such records shall be maintained by the Transfer Agent for the periods and in
the places required by Rule 31a-2 under the 1940 Act.
Upon reasonable notice by the Fund, the Transfer Agent shall make
available during regular business hours its facilities and premises employed
in connection with the performance of its duties under this Agreement for
reasonable visitation by the Fund or any person retained by the Fund.
To the extent required by said Section 31 and the rules and regulations
thereunder, the Transfer Agent agrees that all such records prepared and
maintained by the Transfer Agent relating to the services to be performed
by the Transfer Agent hereunder are the property of the Fund.
The Transfer Agent and the Fund agree that all books, records,
information, and data pertaining to the business of the other party which
are exchanged or received in connection with this Agreement shall remain
confidential and shall not be voluntarily disclosed to any person, except as
may be required by law. In the case of any requests or demands for any
inspection of the Shareholder records of the Fund, the Transfer Agent will
endeavor to notify the Fund and to secure instructions from an authorized
Officer of the Fund as to such inspection.
9. Other Duties.
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In addition to the duties expressly set forth in Schedule B to this
Agreement, the Transfer Agent shall perform such other duties and functions,
and shall be paid such amounts therefore, as may from time to time be agreed
upon in writing between the Fund and the Transfer Agent. Such other duties
and functions shall be reflected in a written amendment to Schedule B, dated
and signed by an Officer of each party hereto.
10. Reliance by Transfer Agent; Instructions.
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(a) The Transfer Agent will be protected in acting upon Written or Oral
Instructions, as appropriate, believed to have been executed or orally
communicated by an Authorized Person and will not be held to have any notice
of any change of authority of any person until receipt of a Written
Instruction thereof from the Fund. The Transfer Agent will also be protected
in processing Share certificates which it reasonably believes to bear the
proper manual or facsimile signatures of the Officers of the Fund and the
proper countersignature of the Transfer Agent.
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(b) At any time the Transfer Agent may apply to any Authorized Person of
the Fund for Written Instructions and may seek advice from legal counsel for
the Fund, or its own legal counsel, with respect to any matter arising in
connection with this Agreement, and it shall not be liable for any action
taken or not taken or suffered by it in good faith in accordance with such
Written Instructions or in accordance with the opinion of counsel for the
Fund or for the Transfer Agent; provided, however, that if such reliance
involves a potential material loss to the Fund, the Transfer Agent will
advise the Fund of any such action(s) to be taken in accordance with the
opinion of counsel to the Transfer Agent. Written Instructions requested by
the Transfer Agent will be provided by the Fund within a reasonable period of
time. In addition, the Transfer Agent, its officers, agents, or employees,
shall accept Oral Instructions or Written Instructions given to them by any
person representing or acting on behalf of the Fund only if said
representative is known by the Transfer Agent, or its officers, agents, or
employees, to be an Authorized Person. The Transfer Agent shall have no duty
or obligation to inquire into, nor shall the Transfer Agent be responsible
for, the legality of any act done by it upon the request or direction of an
Authorized Person.
(c) Notwithstanding any of the foregoing provisions of this Agreement, the
Transfer Agent shall be under no duty or obligation to inquire into, and
shall not be liable for:
(1) the legality of the issuance or sale of any Shares or the
sufficiency of the amount to be received therefore;
(2) the legality of the redemption of any Shares, or the propriety of
the amount to be paid therefore;
(3) the legality of the declaration of any dividend by the Trustees,
or the legality of the issuance of any Shares in payment of any
dividend; or
(4) the legality of any recapitalization or readjustment of the Shares.
11. Acts of God. Etc.
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Neither the Transfer Agent nor the Fund will be liable or responsible
for delays or errors by reason of circumstances beyond its reasonable
control, including acts of civil or military authority, national
emergencies, fire, mechanical breakdown beyond its control, flood or
catastrophe, acts of God, insurrection, war, riots, or failure beyond its
control of transportation, communication, or power supply.
12. Duty of Care and Indemnification.
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The Fund and the Transfer Agent will indemnify each other against and
hold the other party harmless from any and all losses, claims, damages,
liabilities, or expenses (including reasonable counsel fees and expenses)
resulting from any claim, demand, action, or suit not resulting from the
bad faith or negligence of the other party, and arising out of, or in
connection with, the duties and responsibilities described hereunder. In
addition, the Fund will indemnify the Transfer Agent against and hold it
harmless from any and all losses, claims, damages, liabilities, or expenses
(including reasonable counsel fees and expenses) resulting from any claim
demand, action, or suit as a result of:
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(1)any action taken in accordance with Written or Oral Instructions, or
any other instructions, or Share certificates reasonably believed by the
Transfer Agent to be genuine and to be signed, countersigned or
executed, or orally communicated by an Authorized Person;
(2) any action taken in accordance with written or oral advice
reasonably believed by the Transfer Agent to have been given by counsel
for the Fund or its own counsel; or
(3) any action taken as a result of any error or omission in any record
(including but not limited to magnetic tapes, computer printouts, hard
copies, and microfilm copies) delivered or caused to be delivered by the
Fund to the Transfer Agent in connection with this Agreement.
In any case in which the Fund or the Transfer Agent may be asked to
indemnify or hold the other party harmless, the requesting party will provide
the other party with all pertinent facts concerning the situation in question
and will use reasonable care to identify and provide notice of any situation
which presents or appears likely to present a claim for indemnification. Each
party shall have the option to defend the other party against any claim which
may be the subject of this indemnification, and in the event that a party so
elects, such defense shall be conducted by counsel chosen by the party making
such election; and such counsel shall be satisfactory to the other party, and
thereupon such electing party shall take over complete defense of the claim,
and the requesting party shall sustain no further legal or other expenses in
such situation for which it seeks indemnification under this Section 12.
Neither party will confess any claim or make any compromise in any case in
which the other party will be asked to provide indemnification, except with the
other party's prior written consent. The obligations of the parties hereto
under this Section shall survive the termination of this Agreement.
13. Term and Termination.
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This Agreement shall become effective on the date first set forth above
(the "Effective Date") and shall continue in effect from year to year
thereafter as the parties may mutually agree; provided, that either party
hereto may terminate this Agreement by giving to the other party a notice in
writing specifying the date of such termination, which shall be not less than
60 days after the date of receipt of such notice. In the event such notice is
given by the Fund, it shall be accompanied by a resolution of the Board of
Trustees of the Fund, certified by the Secretary, electing to terminate this
Agreement and designating a successor transfer agent or transfer agents. Upon
such termination and at the expense of the Fund, the Transfer Agent will
deliver to such successor a certified list of Shareholders of the Fund (with
names, addresses, and taxpayer identification or Social Security numbers), an
historical record of the account of each Shareholder and the status thereof,
and all other relevant books, records, correspondence, and other data
established or maintained by the Transfer Agent under this Agreement in the
form reasonably acceptable to the Fund, and will cooperate in the transfer of
such duties and responsibilities, including provisions for assistance from the
Transfer Agent's personnel in the establishment of books, records, and other
data by such successor or successors.
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14. Amendment.
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This Agreement may not be amended or modified in any manner except by a
written agreement executed by both parties.
15. Subcontracting.
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Except as otherwise provided below, neither this Agreement nor any rights
or obligations hereunder may be assigned by either party without the express
written consent of the other party. The Transfer Agent may, in its sole
discretion and without further approval from the Fund, subcontract, in whole or
in part, for the performance of its obligations and duties hereunder with any
person or entity including, but not limited to, any affiliate or subsidiary;
provided, however, that (a) the Transfer Agent shall remain fully responsible
to the Fund for the acts and omissions of any agent or subcontractor as it is
for its own acts and omissions, and (b) to the extent that the Transfer Agent
subcontracts any functions or activities required or performed by a registered
transfer agent, the subcontracting party shall be a duly registered transfer
agent with the appropriate regulatory agency as required under Section 17A of
the Securities Exchange Act of 1934 and the rules and regulations thereunder,
as amended.
16. Use of Transfer Agent's Name.
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The Fund shall not use the name of the Transfer Agent in any Prospectus,
Statement of Additional Information, Shareholders' report, sales
literature, or other material relating to the Fund for other than internal use,
in a manner not approved prior thereto; provided, that the Transfer Agent shall
approve all reasonable uses of its name which merely refer in accurate terms to
its appointment hereunder or which are required by the Commission or a state
securities administrator.
17. Use of the Fund's Name.
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The Transfer Agent shall not use the name of the Fund or material
relating to the Fund on any documents or forms for other than internal use in a
manner not approved prior thereto in writing; provided, that the Fund shall
approve all reasonable uses of its name which merely refer in accurate terms
to the appointment of the Transfer Agent or which are required by the
Commission or a state securities administrator.
18. Security.
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The Transfer Agent represents and warrants that, to the best of its
knowledge, the various procedures and systems which the Transfer Agent has
implemented or will implement with regard to safeguarding from loss or damage
attributable to fire; theft, or any other cause (including provision for 24
hours-a-day restricted access) of the Fund's records and other data and the
Transfer Agent's records, data, equipment, facilities, and other property used
in the performance of its obligations hereunder are adequate and that it will
make such changes therein from time to time as in its judgment are required for
the secure performance of its obligations hereunder. The parties shall review
such systems and procedures on a periodic basis.
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19. Miscellaneous.
(a) Any notice or other instrument authorized or required by this Agreement
to be given in writing to the Fund or the Transfer Agent shall be sufficiently
given if addressed to that party and received by it at its office set forth
below or at such other place as it may from time to time designate in writing.
To the Fund:
Integrity Managed Portfolios
#0 Xxxx Xxxxxx Xxxxx
Xxxxx, XX 00000
To the Transfer Agent:
Integrity Fund Services, Inc.
#0 Xxxx Xxxxxx Xxxxx
Xxxxx, XX 00000
(b) This Agreement shall extend to and shall be binding upon the parties
hereto, and their respective successors and assigns; provided, however, that
this Agreement shall not be assignable by the Fund without the written consent
of the other party.
(c) This Agreement shall be construed in accordance with the laws of the
State of North Dakota.
(d) 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) The captions of this 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.
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20. Liability of Trustees, Officers, and Shareholders.
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The execution and delivery of this Agreement have been authorized by the
Trustees of the Fund and signed by an authorized Officer of the Fund, acting as
such, and neither such authorization by such Trustees nor such execution and
delivery by such Officer shall be deemed to have been made by any of them
individually or to impose any liability on any of them personally, and the
obligations of this Agreement are not binding upon any of the Trustees or
Shareholders of the Fund, but bind only the property of the Fund.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective corporate officers thereunder duly authorized as
of the day and year first above written.
INTEGRITY MANAGED PORTFOLIOS
By -------------------------
Date: September 24, 2003
Agreed and Accepted by:
INTEGRITY FUND SERVICES, INC.
By
Date: September 24, 2003
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APPENDIX A
I, Xxxxxx X. Xxxxxxx, President of Integrity Managed Portfolios (the
"Fund"), a Massachusetts business trust, do hereby certify that the following
individuals have been duly authorized as Authorized Persons to give Oral
Instructions and Written Instructions on behalf of the Fund, and the signatures
set forth opposite their respective names are their true and correct
signatures:
Name Signature
---- ---------
Xxxxxx X. Xxxxxxx ---------------------------------
--------------------------------
Xxxxxx X. Xxxxxxx
--------------------------------
Xxxxx X. Xxxxxxx
--------------------------------
Xxxxxx Xxxxxx
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Xxxxx Xxxxx
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SCHEDULE A*
FEE SCHEDULE
TRANSFER AGENT CHARGES
INTEGRITY FUND SERVICES, INC.
For the Transfer Agency services provided under this agreement, each Fund will
pay to Integrity Fund Services, Inc. at the end of each calendar month a
minimum fee of $1,500 per month together with out-of-pocket expenses. Each
Fund will pay an additional minimum fee of $500 per month for each additional
share class. The fees charged by the Transfer Agent, in addition to the stated
minimum, are based upon Fund size as set forth below.
PERCENTAGE
FUND SIZE (NET ASSET VALUE) OF 1%
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0 TO 10,000,000 . 16
10,000,001 TO 25,000,000 .13
25,000,001 TO 50,000,000 .11
50,000,001 AND LARGER .10
*Amounts due under the above Fee Schedule are payable monthly and shall be
calculated as follows: The average daily net asset value of all outstanding
Fund shares within each category (e.g. $0 to $10,000,000 is one category,
$10,000,001 to $25,000,000 is another, etc.) shall be multiplied by the
percentage of 1% applicable to such category and the product thereof divided
by 12. The same procedure shall be followed for each category in which the Fund
has average daily net asset values. The amounts derived by multiplying the
average daily net asset value of each category by the applicable percentages
shall then be added together to determine the amount payable for that month. By
way of example only, if the Fund had average daily net assets of $10,500,000
for the month in question, the computation would be as follows:
$10,000,000 x .0016 / 12= $1,333.33
500,000 x .0013 / 12= 54.17
$1,387.50
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SCHEDULE B
DUTIES OF THE TRANSFER AGENT
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(See Exhibit 1 for Summary of Services.)
1. Shareholder Information.
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The Transfer Agent shall maintain a record of the number of Shares held
by each holder of record which shall include his address and taxpayer
identification number and which shall indicate whether such Shares are held in
certificated or uncertificated form.
2. Shareholder Services.
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The Transfer Agent will investigate all Shareholder inquiries relating
to Shareholder accounts and will answer all correspondence from Shareholders
and others relating to its duties hereunder and such other correspondence as
may from time to time be mutually agreed upon between the Transfer Agent and
the Fund. The Transfer Agent shall keep records of Shareholder correspondence
and replies thereto and of the lapse of time between the receipt of such
correspondence and the mailing of such replies.
3. State Registration Reports.
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The Transfer Agent shall furnish on a state-by-state basis sales reports
and such periodic and special reports as the Fund may reasonably request and
such other information, including Shareholder lists and statistical information
concerning accounts, as may be agreed upon from time to time between the Fund
and the Transfer Agent.
4. Mailing Communications to Shareholders; Proxy Materials.
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The Transfer Agent will address and mail to Shareholders of the Fund all
reports to Shareholders, dividend and distribution notices, and proxy material
for the Fund's meetings of Shareholders. In connection with meetings of
Shareholders, the Transfer Agent will report on proxies voted prior to
meetings, act as inspector of election at meetings, if so requested by the
Fund, and certify Shares voted at meetings.
5. Sales of Shares.
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(a) Processing of Investment Checks or Other Investments. Upon receipt of
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any check or other instrument drawn or endorsed to it as agent for, or
identified as being for the account of the Fund for the purchase of Shares, the
Transfer Agent shall stamp the check with the date of receipt, shall forthwith
process the same for collection, and shall record the number of Shares sold,
the trade date, the price per Share, and the amount of money to be delivered to
the Custodian of the Fund for the sale of such Shares.
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(b) Issuance of Shares. Upon receipt of notification that the Custodian has
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received the amount of money specified in the immediately preceding paragraph,
the Transfer Agent shall issue to and hold in the account of the purchaser/
Shareholder, or if no account is specified therein, in a new account
established in the name of the purchaser, the number of Shares such purchaser
is entitled to receive, as determined in accordance with applicable federal law
or regulation.
(c) Statements. On a quarterly basis, the Transfer Agent shall send to the
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purchaser/Shareholder a statement of purchases which will show the new Share
balance, the Shares held under a particular plan, if any, for withdrawing
investments, the amount invested and the price paid for the newly purchased
Shares, or will be in such other form of statement as the Fund and the Transfer
Agent may agree from time to time.
(d) Suspension of Sale of Shares. The Transfer Agent shall not be required
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to issue any Shares where it has received a Written Instruction from the Fund
or written notice from any appropriate federal or state authority that the sale
of the Shares of the Fund has been suspended or discontinued, and the Transfer
Agent shall be entitled to rely upon such Written Instructions or written
notification.
(e) Taxes in Connection with Issuance of Shares. Upon the issuance of any
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Shares in accordance with the foregoing provisions of this Section, the
Transfer Agent shall not be responsible for the payment of any original issue
or other taxes required to be paid in connection with such issuance.
(f) Returned Checks. In the event that any check or other order for the
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payment of money is returned unpaid for any reason, the Transfer Agent will:
(1) give prompt notice of such return to the Fund or its designee;
(2) place a stop transfer order against all Shares issued as a
result of such check or order; and
(3) take such actions as the Transfer Agent may from time to time
deem appropriate.
6. Redemptions.
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(a) Requirements for Transfer or Redemption of Shares. The Transfer Agent
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shall process all requests from Shareholders to transfer or redeem Shares in
accordance with the procedures set forth in the Prospectus and all
determinations of the number of Shares required to be redeemed to fund
designated monthly payments, automatic payments, or any other such distribution
or withdrawal plan.
The Transfer Agent will transfer or redeem Shares upon receipt of
Written Instructions and Share certificates, if any, properly endorsed for
transfer or redemption, accompanied by such documents as the Transfer Agent
reasonably may deem necessary to evidence the authority of the person making
such transfer or redemption, and bearing satisfactory evidence of the payment
of stock transfer taxes, if any.
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Except to the extent inconsistent with the procedures set forth in the
Prospectus, the Transfer Agent reserves the right to refuse to transfer or
redeem Shares until it is satisfied that the endorsement on the instructions is
valid and genuine, and for that purpose it will require a guarantee of
signature by a member firm of a national securities exchange, by any national
bank or trust company, or by any member bank of the Federal Reserve system. The
Transfer Agent 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 the Transfer Agent, in its good judgment,
deems improper or unauthorized, or until it is reasonably satisfied that there
is no basis to any claims adverse to such transfer or redemption.
The Transfer Agent may, in effecting transactions, rely upon the
provisions of the Uniform Act for the Simplification of Fiduciary Security
Transfers or the provisions of Article 8 of the Uniform Commercial Code, as the
same may be amended from time to time in the State of North Dakota, which in
the opinion of legal counsel for the Fund or of its own legal counsel protect
it in not requiring certain documents in connection with the transfer or
redemption of Shares. The Fund may authorize the Transfer Agent to waive the
signature guarantee in certain cases by Written Instructions.
For the purpose of the redemption of Shares which have been purchased
within 15 days of a redemption request, the Transfer Agent may refuse to redeem
such Shares until the Transfer Agent has received fed funds for the purchase of
such Shares.
(b) Notice to Custodian and Fund. When Shares are redeemed, the Transfer
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Agent shall, upon receipt of the instructions and documents in proper form,
deliver to the Custodian and the Fund a notification setting forth the number
of Shares to be redeemed. Such redemptions shall be reflected on appropriate
accounts maintained by the Transfer Agent reflecting outstanding Shares and
Shares attributed to individual accounts and, if applicable, any individual
withdrawal or distribution plan.
(c) Payment of Redemption Proceeds. The Transfer Agent shall, upon receipt
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of the moneys paid to it by the Custodian for the redemption of Shares, pay to
the Shareholder, or his authorized agent or legal representative, such moneys
as are received from the Custodian, all in accordance with the redemption
procedures described in the Prospectus; provided, however, that the Transfer
Agent shall pay the proceeds of any redemption of Shares purchased within 15
days of a redemption request to the Transfer Agent upon a determination that
good funds have been collected for the purchase of such Shares. The Fund shall
indemnify the Transfer Agent for any payment of redemption proceeds or refusal
to make such payment if the payment or refusal to pay is in accordance with
this Section.
The Transfer Agent shall not process or effect any redemptions pursuant
to a plan of distribution or redemption or in accordance with any other
Shareholder request upon the receipt by the Transfer Agent of notification of
the suspension of the determination of the Fund net asset value.
7. Dividends.
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(a) Notice to Transfer Agent and Custodian. Upon the declaration of each
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dividend and each capital gains distribution by the Board of Trustees of the
Fund with respect to Shares, the Fund shall furnish to the Transfer Agent a
copy of a resolution of its Board of Trustees certified by the Secretary
setting forth with respect to the Shares the date of the declaration of such
dividend or distribution, the ex-dividend date, the date of payment thereof,
the record date as of which
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Shareholders entitled to payment shall be determined, the amount payable per
Share to the Shareholders of record as of that date, the total amount payable
to the Transfer Agent on the payment date,and whether such dividend or
distribution is to be paid in Shares at net asset value.
On or before the payment date specified in such resolution of the Board
of Trustees, the Fund will cause the Custodian of the Fund to pay to the
Transfer Agent sufficient cash to make payment to the Shareholders of record as
of such payment date.
(b) Payment of Dividends by the Transfer Agent. The Transfer Agent will, on
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the designated monthly payment date, automatically reinvest all dividends in
additional Shares at net asset value (determined on such date) and mail to each
Shareholder on a quarterly basis at his address of record, or such other
address as the Shareholder may have designated, a statement showing the number
of full and fractional Shares (rounded to three decimal places) then currently
owned by the Shareholder and the net asset value of the Shares so credited to
the Shareholder's account; provided, however, that if the Transfer Agent has on
file a direction by the Shareholder to pay income dividends or capital gains
dividends, or both, in cash, such dividends shall be paid in accordance with
such instructions; and provided further, that in the event of the return of two
consecutive dividend checks as undeliverable, Transfer Agent shall change such
Shareholder account to a reinvestment account if so provided in the Prospectus.
(c) Insufficient Funds for Payments. If the Transfer Agent does not receive
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sufficient cash from the Custodian to make total dividend and/or distribution
payments to all Shareholders of the Fund as of the record date, the Transfer
Agent will, upon notifying the Fund, withhold payment to all Shareholders of
record as of the record date until such sufficient cash is provided to the
Transfer Agent.
(d) Information Returns. It is understood that the Transfer Agent shall
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file such appropriate information returns concerning the payment of dividends,
return of capital, and capital gain distributions with the proper federal,
state, and local authorities as are required by law to be filed and shall be
responsible for the withholding of taxes, if any, due on such dividends or
distributions to Shareholders when required to withhold taxes under applicable
law.
15
