EXHIBIT (H) (XVI) UNDER FORM N-1A
EXHIBIT 10 UNDER ITEM 601/REG. S-K
SECOND AMENDED AND RESTATED SERVICES AGREEMENT
THIS AGREEMENT, amended and restated as of December 1, 2001, is entered
into between each Fund listed on Schedule 1, as may be amended from time to
time, severally and not jointly, and Federated Shareholder Services Company,
("FSSC"). Unless otherwise defined herein, Section 10 sets forth the definition
of capitalized terms used in this Agreement.
WHEREAS, Schedule 1 to this Agreement sets forth the classes of Shares for
which the Funds will compensate persons who agree to provide services to
Shareholders and assist in the maintenance of Shareholder accounts ("Services");
WHEREAS, FSSC and certain of the Funds entered into a Shareholder Services
Agreement dated March 1, 1994 and amended September 1, 1995, (the "Prior
Agreement") which provided for FSSC to enter into agreements for Services with
third parties ("Third-Party Agreements") and to utilize fees received under the
Prior Agreement to compensate third parties pursuant to such Third-Party
Agreements;
WHEREAS, it is contemplated that hereafter, the Funds will compensate
third-parties for Services directly, and that FSSC will no longer enter into
Third-Party Agreements;
WHEREAS, FSSC will continue to compensate third parties pursuant to any
Third-Party Agreements and the Funds will continue to make payments to FSSC to
fund those obligations; and
WHEREAS, FSSC will also receive fees for Services it provides to
Shareholders under this Agreement.
NOW THEREFORE, the parties agree to amend and restate the Agreement as
follows:
SECTION 1. AGREEMENT TO PROVIDE SERVICES
(A) SERVICES. FSSC agrees to provide Services for Shareholders of
the Funds that have fully-disclosed accounts in the Funds for which either
(i) Federated Securities Corp. or any other affiliate of FSSC is the
dealer of record; or (ii) for which the dealer of record does not provide
Services (collectively, the "FSSC Accounts"). FSSC shall also provide
Services or cause Services to be provided to Shareholders whose accounts
are subject to Third-Party Agreements. Services shall include, but are not
limited to, telephone, mail or electronic communications with
Shareholders.
(B) DELIVERY OF DISCLOSURE DOCUMENTS. Upon request by a customer
that is a Shareholder of the Funds, FSSC will send a copy of the current
Prospectus (and, if expressly requested, Statement of Additional
Information), annual report or semi-annual report for any Fund
("Disclosure Documents") to the customer within three (3) business days of
such request.
(i) The Funds will furnish to FSSC at the Funds' own
expense such number of copies of the then-current
Disclosure Documents as FSSC requests to satisfy its
obligations under this paragraph.
(ii) FSSC covenants to the Funds that it will not make
any representations concerning any Shares other than those
contained in the Disclosure Documents of the applicable
Fund.
(iii) The parties may agree from time to time to set
appropriate security procedures and to perform
electronically certain of their obligations under this
Agreement, including without limitation the delivery of
requested Disclosure Documents.
(c) FSSC shall not have any obligation to pay the cost of producing
or delivering Disclosure Documents or any other costs incurred by the
Funds in connection with the Services provided hereunder.
SECTION 2. SERVICE FEES PAYABLE TO FSSC
(a) During the term of this Agreement, FSSC will be entitled to
receive from each Fund as full compensation for Services rendered
hereunder a fee calculated daily at an annual rate, as set forth Schedule
1 to this Agreement, of up to 0.25% of average net assets held in FSSC
Accounts of each Fund. Service fees paid by the Funds are in addition to
other fees paid by the Funds such as those paid pursuant to an Agreement
for Fund Accounting Services, Administrative Services, Transfer Agency
Services and Custody Services Procurement and fees paid pursuant to each
Fund's Distributor's Contract.
(b) For so long as any Third-Party Agreement remains in effect,
FSSC shall be entitled to receive fees from the Funds calculated daily at
an annual rate, as set forth in Schedule 1 to this Agreement, of up to
0.25% on the average net assets held in accounts of each Fund for which
Services are provided by such third-parties which amount shall be paid by
FSSC in accordance with such Third-Party Agreements.
(c) The Funds shall pay service fees to FSSC in accordance with
their regular payment schedules. For the payment period in which this
Agreement becomes effective or terminates with respect to any Fund, there
shall be an appropriate proration of the fee on the basis of the number of
days that this Agreement is in effect with respect to such Fund during the
period.
SECTION 3. AGREEMENTS WITH OTHER SERVICE PROVIDERS
Each Fund hereby appoints FSSC as the Fund's agent to enter into
agreements with financial intermediaries that are not registered as
broker/dealers under the 1934 Act (each an "Unregistered Intermediary") to
provide Services to their customers that are Shareholders of the Fund. Each Fund
agrees to pay Service Fees at an annual rate as set forth in Schedule 1 to this
Agreement of up to 0.25% of the average net assets held in Fund accounts for
which an Unregistered Intermediary has agreed to provide Services. Any such
accounts shall not be treated as FSSC Accounts for purposes of this Agreement.
SECTION 4. REPRESENTATIONS
(a) Each party represents and warrants to the other party that:
(I) STATUS. It is duly organized and validly existing
under the laws of the jurisdiction of its organization or
incorporation and, if relevant under such laws, in good
standing.
(II) POWERS. It has the power to execute this Agreement
and any other documentation relating to this Agreement to
which it is a party, to deliver this Agreement and any
other documentation relating to this Agreement that it is
required by this Agreement to deliver and to perform its
obligations under this Agreement and has taken all
necessary action to authorize such execution, delivery and
performance.
(III) NO VIOLATION OR CONFLICT. Such execution, delivery
and performance do not violate or conflict with any law
applicable to it, any provision of its constitutional
documents, any order or judgment of any court or other
agency of government applicable to it or any contractual
restriction binding on or affecting it.
(IV) OBLIGATIONS BINDING. Its obligations under this
Agreement constitute its legal, valid and binding
obligations, enforceable in accordance with their
respective terms (subject to applicable bankruptcy,
reorganization, insolvency, moratorium or similar laws
affecting creditors' rights generally and subject, as to
enforceability, to equitable principles of general
application regardless of whether enforcement is sought in
a proceeding in equity or law).
(V) COMPLIANCE WITH LAWS. It will comply in all
material respects with all applicable laws and orders to
which it may be subject if failure to so comply would
materially impair its ability to perform its obligations
under this Agreement.
SECTION 5. INDEMNIFICATION AND LIMITATION OF LIABILITY
(a) In the absence of willful misfeasance, bad faith, gross
negligence or reckless disregard of obligations or duties hereunder on the
part of FSSC and its trustees, officers, employees, agents and
representatives, the Funds agree to indemnify FSSC and its trustees,
officers, employees, agents and representatives against any and all
claims, demands, liabilities and reasonable expenses (including attorneys'
fees), related to or otherwise connected with (i) any breach by the Funds
of any provision of this Agreement; or (ii) any action by a Fund's
Shareholder against FSSC.
(b) FSSC shall not be liable for any error of judgment or mistake
of law or for any loss suffered by any Fund in connection with the matters
to which this Agreement relates, except a loss resulting from willful
misfeasance, bad faith or gross negligence on its part in the performance
of its duties or from reckless disregard by it of its obligations and
duties under this Agreement. In no event shall FSSC be liable for indirect
or consequential damages.
(c) Any person, even though also an officer, trustee, partner,
employee or agent of FSSC, who may be or become an officer, employee or
agent of any Fund or a member of a Fund's Board, shall be deemed, when
rendering services to such Fund or acting on any business of such Fund
(other than services or business in connection with the duties of FSSC
hereunder) to be rendering such services to or acting solely for such Fund
and not as an officer, trustee, partner, employee or agent or one under
the control or direction of FSSC even though paid by FSSC.
(d) FSSC is expressly put on notice of the limitation of liability
as set forth in the Declaration of Trust of each Fund that is a
Massachusetts business trust and agrees that the obligations assumed by
each such Fund pursuant to this Agreement shall be limited in any case to
such Fund and its assets and that FSSC shall not seek satisfaction of any
such obligations from the Shareholders of such Fund, the Trustees,
Officers, Employees or Agents of such Fund, or any of them.
(e) The provisions of this Section shall survive the termination of
this Agreement.
SECTION 6. PRIVACY POLICY
(a) The parties acknowledge that:
(i) The Securities and Exchange Commission has adopted
Regulation S-P at 17 CFR Part 248 to protect the privacy
of individuals who obtain a financial product or service
for personal, family or household use;
(ii) Regulation S-P permits financial institutions, such
as the Funds, to disclose "nonpublic personal information"
("NPI") of its "customers" and "consumers" (as those terms
are therein defined in Regulation S-P) to affiliated and
nonaffiliated third parties of the Funds, without giving
such customers and consumers the ability to opt out of
such disclosure, for the limited purposes of processing
and servicing transactions (17 CFR {section} 248.14); for
specified law enforcement and miscellaneous purposes (17
CFR {section} 248.15); and to service providers or in
connection with joint marketing arrangements (17 CFR
{section} 248.13); and
(iii) Regulation S-P provides that the right of a
customer and consumer to opt out of having his or her NPI
disclosed pursuant to 17 CFR {section} 248.7 and 17 CFR
{section} 248.10 does not apply when the NPI is disclosed
to service providers or in connection with joint marketing
arrangements, provided the Fund and third party enter into
a contractual agreement that prohibits the third party
from disclosing or using the information other than to
carry out the purposes for which the Fund disclosed the
information (17 CFR {section} 248.13).
(b) The parties agree that the Funds may disclose Shareholder NPI
to FSSC as agent of the Funds and solely in furtherance of fulfilling
FSSC's contractual obligations under the Agreement in the ordinary course
of business to support the Funds and their Shareholders.
(c) FSSC hereby agrees to be bound to use and redisclose such NPI
only for the limited purpose of fulfilling its duties and obligations
under the Agreement, for law enforcement and miscellaneous purposes as
permitted in 17 CFR {section}248.15, or in connection with joint marketing
arrangements that the Funds may establish with FSSC in accordance with the
limited exception set forth in 17 CFR 248.13.
(d) FSSC represents and warrants that, in accordance with 17 CFR
{section} 248.30, it has implemented, and will continue to carry out for
the term of the Agreement, policies and procedures reasonably designed to:
(i) Insure the security and confidentiality of records
and NPI of Fund customers;
(ii) Protect against any anticipated threats or hazards
to the security or integrity of Fund customer records and
NPI; and
(iii) Protect against unauthorized access or use of such
Fund customer records or NPI that could result in
substantial harm or inconvenience to any Fund customer.
(e) FSSC may redisclose Section 248.13 NPI only to: (a) the Funds
and affiliated persons of the Funds ("Fund Affiliates"); (b) affiliated
persons of FSSC ("Service Provider Affiliates") (which in turn may
disclose or use the information only to the extent permitted under the
original receipt); (c) a third party not affiliated with FSSC or the Funds
("Nonaffiliated Third Party") under the service and processing
({section}248.14) or miscellaneous ({section}248.15) exceptions, but only
in the ordinary course of business to carry out the activity covered by
the exception under which FSSC received the information in the first
instance; and (d) a Nonaffiliated Third Party under the service provider
and joint marketing exception ({section}248.13), provided FSSC enters into
a written contract with the Nonaffiliated Third Party that prohibits the
Nonaffiliated Third Party from disclosing or using the information other
than to carry out the purposes for which the Funds disclosed the
information in the first instance.
(f) FSSC may redisclose Section 248.14 NPI and Section 248.15 NPI
to: (a) the Funds and Fund Affiliates; (b) Service Provider Affiliates
(which in turn may disclose the information to the same extent permitted
under the original receipt); and (c) a Nonaffiliated Third Party to whom
the Funds might lawfully have disclosed NPI directly.
(g) The provisions of this Section shall survive the termination of
the Agreement.
SECTION 7. NOTICES
(a) All notices of any kind to be given hereunder shall be given in
writing and delivered by personal delivery or by postage prepaid,
registered or certified United States first class mail, return receipt
requested, overnight courier services, or by fax or e-mail (with
confirming copy by mail).
(b) Unless otherwise notified in writing, all notices to any Fund
shall be given or sent to such Fund at:
0000 Xxxxxxxxx Xxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Attention: President
(c) Unless otherwise notified in writing, all notices to FSSC shall
be given or sent to:
Federated Investors Tower
0000 Xxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Attention: President
SECTION 8. ASSIGNMENTS AND NO THIRD-PARTY RIGHTS
(a) Except for any Third-Party Agreements entered into prior to the date
of this Agreement, this Agreement will not be assigned or subcontracted by
either party, without prior written consent of the other party, except
that either party may assign or subcontract this Agreement to an affiliate
controlled, controlled by, or under common control with the assigning or
subcontracting party without such consent. Subject to the preceding, this
Agreement will apply to, be binding in all respects upon, and inure to the
benefit of permitted assigns and subcontractors of the parties. In no
event shall the Funds be obligated to make any payment under this
Agreement to any person other than FSSC.
(b) Nothing expressed or referred to in this Agreement will be construed
to give anyone other than the parties to this Agreement any legal or
equitable right, remedy or claim under or with respect to this Agreement
or any provision of this Agreement. This Agreement and all of its
provisions and conditions are for the sole and exclusive benefit of the
parties to this Agreement and their permitted assigns and subcontractors.
SECTION 9. FORCE MAJEURE
If either party is unable to carry out any of its obligations under this
Agreement because of conditions beyond its reasonable control, including, but
not limited to, acts of war or terrorism, work stoppages, fire, civil
disobedience, delays associated with hardware malfunction or availability,
riots, rebellions, storms, electrical failures, acts of God, and similar
occurrences ("Force Majeure"), this Agreement will remain in effect and the non-
performing party's obligations shall be suspended without liability for a period
equal to the period of the continuing Force Majeure (which period shall not
exceed fifteen (15) business days), provided that:
(i) the non-performing party gives the other party
prompt notice describing the Force Majeure, including the
nature of the occurrence and its expected duration and,
where reasonably practicable, continues to furnish regular
reports with respect thereto during the period of Force
Majeure;
(ii) the suspension of obligations is of no greater
scope and of no longer duration than is required by the
Force Majeure;
(iii) no obligations of either party that accrued before
the Force Majeure are excused as a result of the Force
Majeure;
(iv) the non-performing party uses all reasonable
efforts to remedy its inability to perform as quickly as
possible.
SECTION 10. DEFINITION OF TERMS
(a) "1934 ACT" means the Securities Exchange Act of 1934, and
"1940 ACT" means the Investment Company Act of 1940, in each case as
amended and in effect at the relevant time.
(b) "FUND" means an investment company registered under the 1940
Act and, in the case of a "series company" as defined in Rule 18f-2(a)
under the 1940 Act, each individual portfolio of the series company, set
forth on Schedule 1 to this Agreement from time to time. "FUNDS" means the
Funds listed on Schedule 1 collectively.
(c) "PROSPECTUS" means, with respect to any Shares the most recent
Prospectus and Statement of Additional Information ("SAI") and any
supplement thereto, pursuant to which a Fund publicly offers the Shares;
provided, however, that this definition shall not be construed to require
FSC, Dealer or any Fund to deliver any SAI other than at the express
request of Dealer's customer.
(d) "SHARES" means (1) shares of beneficial interest in a Fund
organized as a business trust; and (2) shares of capital stock in a Fund
organized as a corporation. With respect to a Fund that has established
separate classes of Shares in accordance with Rule 18f-3 under the 1940
Act, Shares refers to the relevant class. "SHAREHOLDER" means the
beneficial owner of any Share.
SECTION 11. MISCELLANEOUS
(a) This Agreement may be terminated by either party by giving the
other party at least sixty (60) days' written notice thereof.
(b) This Agreement may be amended only by a writing signed by both
parties, provided that, any Fund may amend Schedule 1 from time to time by
sending a copy of the amended Schedule to FSSC. Any such amendment shall
be effective ten (10) days after notice thereof.
(c) This Agreement constitutes (along with its Schedules) a
complete and exclusive statement of the terms of the agreement between the
parties and supersedes any prior agreement with respect to its subject
matter.
(d) This Agreement has been entered into between FSSC and each Fund
severally and not jointly, and the provisions this Agreement shall apply
separately to each Fund. No Fund shall be obligated to make any payments
to FSSC under this Agreement other than with respect to its Shares. No
breach of this Agreement by a Fund, or by FSSC against a Fund, shall
constitute a breach of this Agreement with respect to any other Fund.
(e) This Agreement may be executed by different parties on separate
counterparts, each of which, when so executed and delivered, shall be an
original, and all such counterparts shall together constitute one and the
same instrument.
(f) If any provision of this Agreement is held invalid or
unenforceable, the other provisions of this Agreement will remain in full
force and effect. Any provision of this Agreement held invalid or
unenforceable only in part or degree will remain in full force and effect
to the extent not held invalid and unenforceable.
(g) This Agreement will be governed by the laws of the Commonwealth
of Pennsylvania, without regard to conflicts of laws principles thereof.
Any action or proceeding seeking to enforce any provision of, or based on
any right arising out of, this Agreement may be brought against the
parties in the courts of the Commonwealth of Pennsylvania, County of
Allegheny, or, if it has or can acquire jurisdiction, in the United States
District Court for the Western District of Pennsylvania, and each of the
parties consents to the jurisdiction of such courts (and of the
appropriate appellate courts) in any such action or proceeding and waives
any objection to venue laid therein. Each party waives its right to a jury
trial.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed by their officers designated below as of the day and year first above
written.
Attest: FUNDS (LISTED ON SCHEDULE 1)
/s/ Xxxx X. XxXxxxxxx By:/s/ Xxxx X. Xxxxxxx
Xxxx X. XxXxxxxxx Xxxx X. Xxxxxxx
Secretary Chairman
Attest: FEDERATED SHAREHOLDER SERVICES COMPANY
/s/ Xxxxxxx X. Xxxxxxx By: /s/ Xxxxxx X. Xxxxxx, Xx.
Xxxxxxx X. Xxxxxxx Xxxxxx X. Xxxxxx, Xx.
Secretary President
Revised as of 9/17/07
SCHEDULE 1
TO SECOND AMENDED AND RESTATED SERVICES AGREEMENT
The following lists the Funds and Shares subject to the Second Amended and
Restated Services Agreement ("Agreement") which have the ability to charge the
maximum 0.25% Service Fee payable by the Funds pursuant to the Agreement.
FEDERATED FIXED INCOME SECURITIES, INC.:
Federated Municipal Ultrashort Fund
Class A Shares
Institutional Shares
Federated Strategic Income Fund
Class A Shares
Class C Shares
Class F Shares
Institutional Shares
Federated Short-Term Income Fund
Class A Shares
Class Y Shares
Institutional Shares
Institutional Service Shares
Federated Stock and California Muni Fund
Class A Shares
Class C Shares
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