AGENCY AGREEMENT
THIS AGREEMENT made the ___ day of ________, 1998, by and between INVESTORS
FIDUCIARY TRUST COMPANY, a state chartered trust company organized and existing
under the laws of the State of Missouri, having its principal place of business
at 000 Xxxx 00xx Xxxxxx, Xxxxxx Xxxx, Xxxxxxxx 00000 ("IFTC"), and MENTOR FUNDS,
a Massachusetts business trust, having its principal place of business at 000
Xxxx Xxxx Xxxxxx, Xxxxxxxx, Xxxxxxxx 00000 on behalf of each of Mentor
Institutional Money Market Portfolio and Mentor Institutional U.S. Government
Money Market Portfolio (A reference to "Fund" shall be to Mentor Funds on behalf
of each such Portfolio, severally and not jointly).:
WITNESSETH:
WHEREAS, Mentor Funds desires to appoint IFTC as Transfer Agent and
Dividend Disbursing Agent for each Fund, and IFTC desires to accept such
appointment;
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
the parties hereto agree as follows:
1. Documents to be Filed with Appointment.
In connection with the appointment of IFTC as Transfer Agent and Dividend
Disbursing Agent for Fund, there will be filed with IFTC the following
documents, upon request:
A. A certified copy of the resolutions of the Trustees of Mentor Funds
appointing IFTC as Transfer Agent and Dividend Disbursing Agent, approving
the form of
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this Agreement, and designating certain persons to sign share certificates,
if any, and give written instructions and requests on behalf of Fund;
B. A certified copy of the Agreement and Declaration of Trust of Mentor
Funds and all amendments thereto,:
C. A certified copy of the Bylaws of Mentor Funds;
D. Copies of Registration Statements and amendments thereto, filed with the
Securities and Exchange Commission.
E. Specimens of all forms of outstanding share certificates, in the forms
approved by the Trustees of Mentor Funds, with a certificate of the
Secretary of Mentor Funds as to such approval;
F. Specimens of the signatures of the officers of Mentor Funds authorized
to sign share certificates and individuals authorized to sign written
instructions and requests;
G. An opinion of counsel for Mentor Funds with respect to:
(1) Mentor Funds' organization and existence under the laws of its
state of organization,
(2) The status of all shares of beneficial interest of Fund under the
Securities Act of 1933, as amended, and any other applicable federal
or state statute and
(3) That all issued shares are, and all unissued shares will be, when
issued, validly issued, fully paid and nonassessable.
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2. Certain Representations and Warranties of IFTC.
IFTC represents and warrants to Fund that:
A. It is a trust company duly organized and existing and in good standing
under the laws of Missouri.
B. It is duly qualified to carry on its business in the State of Missouri.
C. It is empowered under applicable laws and by its charter and bylaws to
enter into and perform the services contemplated in this Agreement.
D. It is registered as a transfer agent to the extent required under the
Securities Exchange Act of 1934.
E. All requisite corporate proceedings have been taken to authorize it to
enter into and perform this Agreement.
F. It has and will continue to have and maintain the necessary facilities,
equipment and personnel to perform its duties and obligations under this
Agreement.
3. Certain Representations and Warranties of Fund.
Mentor Fund represents and warrants to IFTC that:
A. It is a business trust duly organized and existing and in good standing
under the laws of the Commonwealth of Massachusetts.
B. It is an open-end management investment company registered under the
Investment Company Act of 1940, as amended.
C. A registration statement under the Securities Act of 1933 has been filed
and will be effective with respect to all shares of Fund being offered for
sale.
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D. All requisite steps have been or will be taken to register Fund's shares
for sale in all applicable states.
E. Mentor Funds is empowered under applicable laws and by its Agreement and
Declaration of Trust and bylaws to enter into and perform this Agreement.
4. Scope of Appointment.
A. Subject to the conditions set forth in this Agreement, Mentor Funds
hereby appoints IFTC as Transfer Agent and Dividend Disbursing Agent in
respect of each Fund.
B. IFTC hereby accepts such appointment and agrees that it will act as each
Fund's Transfer Agent and Dividend Disbursing Agent. IFTC agrees that it
will also act as agent in connection with Fund's periodic withdrawal
payment accounts and other open accounts or similar plans for shareholders,
if any.
C. IFTC agrees to provide the necessary facilities, equipment and personnel
to perform its duties and obligations hereunder in accordance with industry
practice.
D. Mentor Funds agrees to use its best efforts to deliver to IFTC in Kansas
City, Missouri, as soon as they are available, originals or copies of all
of its shareholder account records in respect of each Fund.
E. IFTC agrees that it will perform the usual and ordinary services as
transfer, dividend disbursing and shareholders' servicing agent for Fund,
and as agent of Fund for shareholder accounts thereof, in a timely manner,
including issuing
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(including countersigning), transferring and canceling share certificates;
maintaining all shareholder accounts; providing transaction journals;
preparing shareholder meeting lists, mailing proxies and proxy materials,
receiving and tabulating proxies, certifying the shareholder votes in the
Fund; mailing shareholder reports and prospectuses; withholding, as
required by Federal law, taxes on shareholder accounts, disbursing income
dividends and capital gains distributions to shareholders, preparing,
filing and mailing U.S. Treasury Department Forms 1099, W2-P, 1042S and
backup withholding as required for all shareholders; preparing and mailing
confirmation forms to shareholders and dealers, as instructed, for all
purchases and liquidations of shares of the Fund and other confirmable
transactions in shareholders' accounts; recording reinvestment of dividends
and distributions in shares of the Fund; providing or making available
on-line daily and monthly reports as provided by the mutual fund processing
system utilized by IFTC (the "DST System") and as requested by the Fund or
its management company; maintaining those records necessary to carry out
IFTC's duties hereunder, including all information reasonably required by
the Fund to account for all transactions in Fund shares, calculating the
appropriate sales charge with respect to each purchase of Fund shares as
set forth in the prospectus for the Fund, determining the portion of each
sales charge payable to the dealer participating in a sale in accordance
with schedules delivered to IFTC by the Fund's principal underwriter or
distributor (hereinafter
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"principal underwriter") from time to time, disbursing dealer commissions
collected to such dealers, determining the portion of each sales charge
payable to such principal underwriter and disbursing such commissions to
the principal underwriter; receiving correspondence pertaining to any
former, existing or new shareholder account, processing such correspondence
for proper recordkeeping, and responding promptly to shareholder
correspondence; processing, as provided in the Fund's prospectus, purchases
or redemptions or instructions to settle any mail or wire order purchases
or redemptions received in proper order as set forth in the prospectus,
rejecting promptly any requests not received in proper order (as defined by
the Fund or its designated agents), and causing exchanges of shares to be
executed in accordance with the Fund's instructions and prospectus and the
general exchange privilege application, as they may be amended for time to
time; mailing to dealers confirmations of wire order trades; and mailing
copies of shareholder statements to shareholders and registered
representatives of dealers in accordance with the Fund's instructions.
F. IFTC will use reasonable efforts to provide, reasonably promptly under
the circumstances, the same services with respect to any new, additional
functions or features or any changes or improvements to existing functions
or features as provided for in the Fund's prospectus as amended from time
to time, provided, however, that IFTC is advised in advance by the Fund of
any changes therein and the mutual fund processing system utilized by IFTC
(the "DST System") as
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then constituted supports such additional functions and features. If any
addition to, improvement of or change in the features and functions
currently provided by the DST System requested by the Fund requires an
enhancement or modification to the DST System, IFTC shall not be liable
therefor until such modification or enhancement is installed on the DST
System. If any new, additional function or feature or change or improvement
to existing functions or features or new service measurably increases
IFTC's cost of performing the services required hereunder at the current
level of service, IFTC shall advise the Fund of the amount of such increase
and if the Fund elects to utilize such function, feature or service, IFTC
shall be entitled to increase its fees by the amount of the increase in
costs.
5. Limit of Authority.
Unless otherwise expressly limited by the resolution of appointment or by
subsequent action by the Fund, the appointment of IFTC as Transfer Agent
will be construed to cover the full amount of authorized shares of the
class or classes for which IFTC is appointed as the same will, from time to
time, be constituted, and any subsequent increases in such authorized
amount.
6. Compensation and Expenses.
A. In consideration for its services hereunder as Transfer Agent and
Dividend Disbursing Agent, Fund will pay to IFTC from time to time, as
compensation for all services rendered as Agent, the fees set forth in a
separate schedule to be
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agreed to by Fund and IFTC in writing from time to time and also all its
reasonable out-of-pocket expenses, charges, counsel fees, and other
disbursements (Compensation and Expenses) incurred in connection with the
agency. The initial fee schedule is attached hereto and incorporated herein
by reference. If the Fund has not paid such Compensation and Expenses to
IFTC within a reasonable time, IFTC may charge against any monies held
under this Agreement, the amount of any Compensation and/or Expenses for
which it shall be entitled to reimbursement under this Agreement.
B. The Fund also agrees promptly to reimburse IFTC for all reasonable
out-of- pocket expenses or disbursements incurred by IFTC in connection
with the performance of services under this Agreement including, but not
limited to, expenses for postage (in advance if requested), express
delivery services, freight charges, envelopes, checks, drafts, forms
(continuous or otherwise), specially requested reports and statements,
telephone calls, telegraphs, stationery supplies, reasonable outside
counsel fees, outside mailing fu-ms, (including Support Resources, Inc.),
magnetic tapes, reels or cartridges (if sent to Fund or to a third party at
Fund's request) and magnetic tape handling charges, record storage and
media for storage of records (e.g., microfilm, microfiche, optical
platters, computer tapes), computer equipment installed at the Fund's
request at the Fund's or third party's premises, telecommunications
equipment and related telephone lines, proxy soliciting, processing and/or
tabulating costs, and NSCC
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transaction fees to the extent any of the foregoing are paid by IFTC. The
Fund agrees to pay postage expenses at least one day in advance if so
requested. In addition, any other expenses incurred by IFTC at the request
or with the consent of the Fund will be promptly reimbursed by the Fund.
7. Operation of IFTC System.
A. In connection with the performance of its services under this Agreement,
IFTC is responsible for such items as:
(1) The accuracy of entries in IFTC's records reflecting orders and
instructions received by IFTC from dealers, shareholders, Fund or its
principal underwriter;
(2) The availability and the accuracy of shareholder lists,
shareholder account verifications, confirmations and other shareholder
account information to be produced from its records or data;
(3) The accurate and timely issuance of dividend and distribution
checks in accordance with instructions received from Fund;
(4) The accuracy of redemption transactions and payments in accordance
with redemption instructions received from dealers, shareholders or
Fund;
(5) The deposit daily in Fund's appropriate special bank account of
all checks and payments received from dealers or shareholders for
investment in shares;
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(6) The requiring of proper forms of instruction, signatures and
signature guarantees and any necessary documents supporting the
legality of transfers, redemptions and other shareholder account
transactions, all in conformance with IFTC's present procedures with
such changes as may be required or approved by Fund; and
(7) The maintenance of a current duplicate set of Fund's essential
records at a secure distant location, in a form available and usable
forthwith in the event of any break-down or disaster disrupting its
main operation.
8. Indemnification.
A. IFTC shall at all times use reasonable care, due diligence and act in
good faith in performing its duties under this Agreement. Except to the
extent caused by IFTC's bad faith conduct, IFTC shall not be responsible
for, and the Fund shall indemnify and hold IFTC harmless from and against,
any and all losses, damages, costs, charges, counsel fees, payments,
expenses and liability which may be asserted against IFTC or for which IFTC
may be held to be liable, to the extent arising out of or attributable to:
(1) All actions of IFTC required to be taken by IFTC pursuant to this
Agreement, provided that IFTC has acted in good faith and with due
diligence and reasonable care;
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(2) The Fund's refusal or failure to comply with the terms of this
Agreement, the Fund's negligence or willful misconduct, or the breach
of any representation or warranty of the Fund hereunder;
(3) The good faith reliance on, or the carrying out of, any written or
recorded oral instructions or requests of persons designated by the
Fund in writing from time to time as authorized to give instructions
on its behalf or representatives of the Fund's investment advisor,
sponsor or principal underwriter or IFTC's good faith reliance on, or
use of, information, data, records and documents received from, or
which have been prepared and/or maintained by the Fund, its investment
advisor, its sponsor or its principal underwriter;
(4) Defaults by dealers or shareowners with respect to payment for
share orders previously entered;
(5) The offer or sale of the Fund's shares in violation of any
requirement under federal securities laws or regulations or the
Securities laws or regulations of any state or in violation of any
stop order or other determination or ruling by any federal agency or
state with respect to the offer or sale of such shares in such state
(unless such violation results from IFTC's failure to comply with
written instructions of the Fund or of any officer of the Fund that no
offers or sales be made in or to residents of such state);
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(6) The Fund's errors and mistakes in the use of the DST System, the
data center, computer and related equipment used to access the DST
System (the "DST Facilities"), and control procedures relating thereto
in the verification of output and in the remote input of data; and
(7) Errors, inaccuracies, and omissions in, or errors, inaccuracies or
omissions of IFTC arising out of or resulting from such errors,
inaccuracies and omissions in, the Fund's records, shareholder and
other records, delivered to IFTC hereunder by the Fund or its prior
agent(s).
B. IFTC shall indemnify and hold the Fund harmless from and against any and
all losses, damages, costs, charges, counsel fees, payments, expenses and
liability arising out of IFTC's failure to comply with the terms of this
Agreement or arising out of or attributable to IFTC's negligence or willful
misconduct or breach of any representation or warranty of IFTC hereunder.
In the event IFTC shall be liable under this subsection, then the Fund
shall (unless the liability arises out of IFTC's willful misconduct) take
reasonable steps with IFTC to mitigate the amount of such liability.
C. EXCEPT FOR VIOLATIONS OF SECTION 23., 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,
SPECIAL OR PUNITIVE DAMAGES FOR ANY ACT OR FAILURE TO
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ACT UNDER ANY PROVISION OF THIS AGREEMENT EVEN IF ADVISED OF THE
POSSIBILITY THEREOF.
9. Certain Covenants of IFTC and Fund.
A. All requisite steps will be taken by Fund from time to time when and as
necessary to register the Fund's shares for sale in 0 states in which
Fund's shares shall at the time be offered for sale and require
registration. If at any time Fund will receive notice of any stop order or
other proceeding in any such state affecting such registration or the sale
of Fund's shares, or of any stop order or other proceeding under the
federal securities laws affecting the sale of Fund's shares, Fund will give
prompt notice thereof to IFTC.
B. IFTC hereby agrees to perform such transfer agency functions as are set
forth in Section 4.E. above and establish and maintain facilities and
procedures reasonably acceptable to Fund for safekeeping of share
certificates, check forms, and facsimile signature imprinting devices, if
any; and for the preparation or use, and for keeping account of, such
certificates, forms and devices, and to carry such insurance as it
considers adequate and reasonably available.
C. To the extent required by Section 31 of the Investment Company Act of
1940 as amended and Rules thereunder, IFTC agrees that all records
maintained by IFTC relating to the services to be performed by IFTC under
this Agreement are
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the property of Fund and will be preserved and will be surrendered promptly
to Fund on request.
D. IFTC agrees to furnish Fund semiannual reports of its financial
condition, consisting of a balance sheet, earnings statement and any other
financial information reasonably requested by Fund. The annual financial
statements will be certified by IFTC's certified public accountants.
E. IFTC represents and agrees that it will use its best efforts to keep
current on the trends of the investment company industry relating to
shareholder services and will use its best efforts to continue to modernize
and improve.
F. IFTC will permit Fund and its authorized representatives to make
periodic inspections of its operations as such would involve the Fund at
reasonable times during business hours.
10. Recapitalization or Readjustment.
In case of any recapitalization, readjustment or other change in the
capital structure of Fund requiring a change in the form of share
certificates, IFTC will issue or register certificates in the new form in
exchange for, or in transfer of, the outstanding certificates in the old
form, upon receiving:
A. Written instructions from an officer of Fund;
B. Certified copy of the amendment to Mentor Funds' Agreement and
Declaration of Trust or other document effecting the change;
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C. Certified copy of the order or consent of each governmental or
regulatory authority, required by law to the issuance of the shares in the
new form, and an opinion of counsel that the order or consent of no other
government or regulatory authority is required;
D. Specimens of the new certificates in the form approved by the Trustees
of Mentor Funds, with a certificate of the Secretary of Mentor Funds as to
such approval;
E. Opinion of counsel for Mentor Funds stating:
(1) The status of the shares of beneficial interest of Fund in the new
form under the Securities Act of 1933, as amended and any other
applicable federal or state statute; and
(2) That the issued shares in the new form are, and all unissued
shares will be, when issued, validly issued, fully paid and
nonassessable.
11. Share Certificates.
Fund will furnish IFTC with a sufficient supply of blank share certificates
and from time to time will renew such supply upon the request of IFTC. Such
certificates will be signed manually or by facsimile signatures of the
officers of Fund authorized by law and by bylaws to sign share
certificates, and if required, will bear the corporate seal or facsimile
thereof.
12. Death, Resignation or Removal of Signing Officer.
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Fund will file promptly with IFTC written notice of any change in the
officers authorized to sign share certificates, written instructions or
requests, together with two signature cards bearing the specimen signature
of each newly authorized officer. In case any officer of Fund who will have
signed manually or whose facsimile signature will have been affixed to
blank share certificates will die, resign, or be removed prior to the
issuance of such certificates, IFTC may issue or register such share
certificates as the share certificates of Fund notwithstanding such death,
resignation, or removal, until specifically directed to the contrary by
Fund in writing. In the absence of such direction, Fund will file promptly
with IFTC such approval, adoption, or ratification as may be required by
law.
13. Future Amendments of Charter and Bylaws.
Fund will promptly file with IFTC copies of all material amendments to its
Agreement and Declaration of Trust or bylaws made after the date of this
Agreement.
14. Instructions, Opinion of Counsel and Signatures.
At any time IFTC may apply to any person authorized by the Fund to give
instructions to IFTC, and may with the approval of a Fund officer consult
with legal counsel for Fund or its own legal counsel at the expense of
Fund, with respect to any matter arising in connection with the agency and
it will not be liable for any action taken or omitted by it reasonably and
in good faith in reliance upon such instructions or upon the opinion of
such counsel. IFTC will be protected in acting upon any paper or document
reasonably believed by it to be genuine and to have been signed by the
proper person or
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persons and will not be held to have notice of any change of authority of
any person, until receipt of written notice thereof from Fund. It will also
be protected in recognizing share certificates which it reasonably believes
to bear the proper manual or facsimile signatures of the officers of Mentor
Funds, and the proper countersignature of any former Transfer Agent or
Registrar, or of a co-Transfer Agent or co-Registrar.
15. Omnibus Accounts.
The Fund recognizes that the Fund shall be marketed primarily through
broker-dealers whose clients' positions and holdings in the Fund will be
contained within an omnibus account in the broker-dealer's name.
Accordingly, the books and records of the Fund as maintained by IFTC may
not reflect the name, address and other identifying information concerning
the ultimate investors but merely the name, address and other identifying
information concerning the nominee broker-dealer. Further, IFTC shall not
have any role or responsibility in choosing, accepting or rejecting
prospective broker- dealer nominees. Accordingly, IFTC shall have no
responsibility or liability for the actions or omissions of any such
broker-dealer.
16. [Intentionally Omitted].
17. Records.
IFTC will maintain customary records in connection with its agency, and
particularly will maintain those records required to be maintained pursuant
to subparagraph (2) (iv) of paragraph (b) of Rule 31a-l under the
Investment Company Act of 1940, if any.
18. Disposition of Books, Records and Canceled Certificates.
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IFTC will send periodically to Fund, or to where designated by the
Secretary or an Assistant Secretary of Mentor Funds, all books, documents,
and all records no longer deemed needed for current purposes and share
certificates which have been canceled in transfer or in exchange, upon the
understanding that such books, documents, records, and share certificates
will be maintained by the Fund under and in accordance with the
requirements of Section 17Ad-7 adopted under the Securities Exchange Act of
1934. Such materials relating to share certificates which have been stopped
and replaced and share certificates escheated will not be destroyed by Fund
without the written consent of IFTC (which consent will not be unreasonably
withheld), but will be safely stored for possible future reference.
19. Provisions Relating to IFTC as Transfer Aunt.
A. IFTC will make original issues of share certificates upon written
request of an officer of Fund and upon being furnished with a certified
copy of a resolution of the Trustees authorizing such original issue, an
opinion of counsel as outlined in paragraphs LD. and G. of this Agreement,
any documents required by paragraphs 5. or 10. of this Agreement, and
necessary funds for the payment of any original issue tax.
B. Before making any original issue of certificates Fund will furnish IFTC
with sufficient funds to pay all required taxes on the original issue of
the share, if any. Fund will furnish IFTC such evidence as may be required
by IFTC to show the actual value of the shares.
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C. Shares will be transferred and new certificates issued in transfer, or
shares accepted for redemption and funds remitted therefor, upon surrender
of the old certificates in form reasonably deemed by IFTC properly endorsed
for transfer or redemption accompanied by such documents as IFTC may
reasonably deem necessary to evidence that authority of the person making
the transfer or redemption, and bearing satisfactory evidence of the
payment of any applicable share transfer taxes. IFTC reserves the right to
refuse to transfer or redeem shares until it is satisfied that the
endorsement or signature on the certificate or any other document is valid
and genuine, and for that purpose it may require a guaranty of signature by
a firm having membership in the New York Stock Exchange, Midwest Stock
Exchange, American Stock Exchange, Pacific Coast Stock Exchange, or any
other exchange acceptable to IFTC or by a bank or trust company approved by
it. IFTC also reserves the right to refuse to transfer or redeem shares
until it is satisfied that the requested transfer or redemption is legally
authorized, and it will incur no liability for the refusal in good faith to
make transfers or redemptions which, in its reasonable judgment, are
improper or unauthorized. IFTC may, in effecting transfers or redemptions,
rely upon Simplification Acts or other statutes which protect it and Fund
in not requiring complete fiduciary documentation.
D. When mail is used for delivery of share certificates IFTC will forward
share certificates in "nonnegotiable" form by first class or registered
mail and share
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certificates in "negotiable" form by registered mail, all such mail
deliveries to be covered while in transit to the addressee by insurance
arranged for by IFTC.
E. IFTC will issue and mail subscription warrants, certificates
representing share dividends, exchanges or split ups, or act as Conversion
Agent upon receiving written instructions from any officer of Mentor Funds
and such other documents as IFTC deems necessary.
F. IFTC will issue, transfer, and split up certificates and will issue
certificates representing full shares upon surrender of scrip certificates
aggregating one full share or more when presented to IFTC for that purpose
upon receiving written instructions from an officer of Mentor Funds and
such other documents as IFTC may deem necessary.
G. IFTC may issue new certificates in place of certificates represented to
have been lost, destroyed, stolen or otherwise wrongfully taken upon
receiving instructions from Fund and indemnity satisfactory to IFTC and
Fund, and may issue new certificates in exchange for, and upon surrender
of, mutilated certificates. Such instructions from Fund will be in such
form as will be approved by the Trustees of Fund and will be in accordance
with the provisions of law and the bylaws of Fund governing such matter.
H. IFTC will supply a shareholder's list to Fund for any shareholder
meeting upon receiving a request from an officer of Mentor Funds. It will
also supply lists at such other times as may be requested by an officer of
Mentor Funds.
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I. Upon receipt of written instructions of an officer of Mentor Funds, IFTC
will address and mail notices to shareholders.
J. In case of any request or demand for the inspection of the share books
of Fund or any other books in the possession of IFTC, IFTC will endeavor to
notify Fund and to secure instructions as to permitting or refusing such
inspection. IFTC reserves the right, however, to exhibit the share books or
other books to any person in case it is advised by its counsel that it may
be held responsible for the failure to exhibit the share books or other
books to such person.
20. Provisions Relating to Dividend Disbursing Agency.
A. IFTC will, at the expense of Fund, provide a special form of check
containing the imprint of any device or other matter desired by Fund. Said
checks must, however, be of a form and size convenient for use by IFTC.
B. If Fund desires to include additional printed matter, financial
statements, etc., with the dividend checks, the same will be furnished IFTC
within a reasonable time prior to the date of mailing of the dividend
checks, at the expense of Fund.
C. If Fund desires its distributions mailed in any special form of
envelopes, sufficient supply of the same will be furnished to IFTC but the
size and form of said envelopes will be subject to the approval of IFTC. If
stamped envelopes are used, they must be furnished by Fund; or if postage
stamps are to be affixed to the envelopes, the stamps or the cash necessary
for such stamps must be furnished by Fund.
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D. IFTC will maintain one or more deposit accounts as Agent for Fund, into
which the monies received by IFTC as agent of the Fund and monies for
payment of dividends, distributions, redemptions or other disbursements
provided for hereunder will be deposited, and against which checks will be
drawn. If IFTC shall, in its sole discretion, advance funds to the account
of the Fund which results in an overdraft on any account of Fund maintained
at IFTC, the amount of the overdraft shall be payable on demand along with
the overdraft fee provided for in the then-current fee schedule. IFTC shall
be entitled to offset the amount owed for any such overdraft against any
other monies of Fund held by IFTC.
E. IFTC is authorized and directed to stop payment of checks theretofore
issued hereunder, but not presented for payment, when the payees thereof
allege either that they have not received the checks or that such checks
have been mislaid, lost, stolen, destroyed or through no fault of theirs,
are otherwise beyond their control, and cannot be produced by them for
presentation and collection, and, upon receipt of appropriate indemnities
or undertakings from the payees, to issue and deliver duplicate checks in
replacement thereof.
21. Assumption of Duties By the Fund.
The Fund may assume certain duties and responsibilities of IFTC or those
usual and ordinary services of Transfer Agent and Dividend Disbursement
Agent as those terms are referred to in Section 4.E. of this Agreement
including but not limited to accepting
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shareholder instructions and transmitting orders based on such instructions
to IFTC, preparing and mailing confirmations, obtaining certified TIN
numbers, and disbursing monies of the Fund. To the extent the Fund or its
agent or affiliate assumes such duties and responsibilities, IFTC shall be
relieved from all responsibility and liability therefor.
22. Termination of Agreement.
A. This Agreement may be terminated by either party upon receipt of ninety
(90) days written notice from the other party.
B. Fund, in addition to any other rights and remedies, shall have the right
to terminate this Agreement forthwith upon the occurrence at any time of
any of the following events:
(1) Any interruption or cessation of operations by IFTC or its assigns
which materially interferes with the business operation of Fund;
(2) The insolvency or bankruptcy of IFTC or the appointment of a
receiver for IFTC;
(3) Any merger, consolidation or sale of substantially all the assets
of IFTC;
(4) The acquisition of a controlling interest in IFTC by any broker,
dealer, investment adviser or investment company except as may
presently exist; or
(5) Failure by IFTC or its assigns to perform its duties in accordance
with the Agreement, which failure materially adversely affects the
business operations of Fund and which failure continues for ten (10)
business days
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after receipt of written notice from Fund; provided, however, that
notwithstanding the foregoing, if such failure cannot reasonably be
cured within ten (10) business days, then IFTC shall have such time as
is reasonably necessary to cure such failure, but not to exceed thirty
(30) days.
C. In the event of termination, Fund will promptly pay IFTC all amounts due
to IFTC hereunder.
D. In the event of termination, (1) IFTC will transfer the books and
records of the Fund to the designated successor transfer for reasonable
compensation therefor, and (2) IFTC will provide other reasonably necessary
information relating to its services provided hereunder other than IFTC
Protected Information (as defined in Section 23.C.) for reasonable
compensation therefor.
23. Confidentiality.
A. IFTC agrees that, except as provided in the last sentence of Section
19.J hereof, or as otherwise required by law, IFTC will keep confidential
all records of and information in its possession relating to Fund or its
shareholders or shareholder accounts and will not disclose the same to any
person except at the request or with the consent of Fund.
B. Fund agrees that, except as otherwise required by law, Fund will keep
confidential all financial statements and other financial records (other
than statements and records relating solely to Fund's business dealings
with IFTC or
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Fund operations) and all manuals, systems and other technical information
and data, not publicly disclosed, relating to IFTC's operations and
programs furnished to it by IFTC pursuant to this Agreement and will not
disclose the same to any person except at the request or with the consent
of IFTC.
C. The Fund acknowledges that IFTC and DST Systems, Inc. (DST) have
proprietary rights in and to the computerized data processing recordkeeping
system used by IFTC to perform services hereunder including, but not
limited to the maintenance of shareholder accounts and records, processing
of related information and generation of output (the MFS System),
including, without limitation any changes or modifications of the MFS
System and any other IFTC or DST programs, data bases, supporting
documentation, or procedures (collectively "IFTC Protected Information")
which the Fund's access to the MFS System or computer hardware or software
may permit the Fund or its employees or agents to become aware of or to
access and that the IFTC Protected Information constitutes confidential
material and trade secrets of IFTC. The Fund agrees to maintain the
confidentiality of the IFTC Protected Information. The Fund acknowledges
that any unauthorized use, misuse, disclosure or taking of IFTC Protected
Information which is confidential as provided by law, or which is a trade
secret, residing or existing internal or external to a computer, computer
system, or computer network, or the knowing and unauthorized accessing or
causing to be accessed of any computer,
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computer system, or computer network, may be subject to civil liabilities
and criminal penalties under applicable state law. The Fund will advise all
of its employees and agents who have access to any IFTC Protected
Information or to any computer equipment capable of accessing IFTC or DST
hardware or software of the foregoing. DST is intended to be, and shall be,
a third party beneficiary of the Fund's obligations and undertakings
contained in this Section.
D. If either party believes at any time that it is or may be required by
law to disclose confidential information of the other party, it shall
notify such other party thereof as promptly as possible and permit the
other party to contest the disclosure by appropriate legal proceedings or
other action.
24. Changes and Modifications.
A. During the term of this Agreement IFTC will use on behalf of the Fund
without additional cost all modifications, enhancements, or changes which
DST or IFTC may make to its shareholder/transfer agent processing system in
the normal course of its business and which are applicable to functions and
features offered by the Fund, unless substantially all DST or IFTC clients
are charged separately for such modifications, enhancements or changes,
including, without limitation, substantial system revisions or
modifications necessitated by changes in existing laws, rules or
regulations. The Fund agrees to pay IFTC promptly for modifications and
improvements utilized by the Fund which are charged for separately at the
rate provided for in DST's or IFTC's standard pricing schedule
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which shall be identical for substantially all clients, if a standard
pricing schedule shall exist, provided that IFTC shall give the Fund ninety
(90) days advance written notice thereof. If there is no standard pricing
schedule, the par- ties shall mutually agree upon the rates to be charged.
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B. IFTC shall have the right, at any time and from time to time, to alter
and modify any systems, programs, procedures or facilities used or employed
in performing its duties and obligations hereunder; provided that the Fund
will be notified as promptly as possible prior to implementation of such
alterations and modifications and that no such alteration or modification
or deletion shall materially adversely change or affect the operations and
procedures of the Fund unless the Fund is given sixty (60) days prior
notice to allow the Fund to change its procedures; and provided further,
that if any fee increase shall result therefrom, IFTC shall give the Fund
ninety (90) days advance written notice thereof. All enhancements,
improvements, changes, modifications or new features added to the DST
System however developed or paid for shall be, and shall remain, the
confidential and exclusive property of, and proprietary to, DST Systems,
Inc. Notwithstanding the foregoing, at the request of the Fund, all
enhancements, improvements, modifications or new features added to the DST
System developed at the expense of the Fund, may be subject to a period of
exclusivity as mutually agreed to by the Fund and IFTC, which period may
not exceed three (3) months.
25. Subcontractors.
The Fund acknowledges that IFTC intends to subcontract certain obligations
hereunder and consents to such subcontract on condition that IFTC shall
remain fully responsible and liable for the complete and proper performance
of IFTC's obligations hereunder,
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that all acts and omissions of any such subcontractor hereunder shall for
all purposes hereof be considered and deemed to be acts or omissions of
IFTC and that the Fund shall be fully responsible and liable hereunder to
IFTC as if no subcontract had occur- red and such obligations had been
performed by IFTC itself.
26. Force Majeure.
IFTC shall not be responsible or liable for its failure or delay in
performance of its obligations under this Agreement to the extent arising
out of or caused, directly or indirectly, by circumstances beyond its
reasonable control, including, without limitation: any interruption, loss
or malfunction or any utility, transportation, computer (hardware or
software) or communication service; inability to obtain labor, material,
equipment or transportation, or a delay in mails; governmental or exchange
action, statute, ordinance, rulings, regulations or direction; war, strike,
riot, emergency, civil disturbance, terrorism, vandalism, explosions, labor
disputes, freezes, floods, fires, tornados, acts of God or public enemy,
revolutions, or insurrection; or any other cause, contingency, circumstance
or delay not subject to IFTC's reasonable control.
27. Declaration of Trust. The parties agree that this Agreement shall constitute
a separate and discrete agreement between IFTC and each Fund, as if set out
in a separate writing executed by IFTC and Mentor Funds on behalf solely of
that Fund alone, and no other series of shares of Mentor Funds shall have
any obligation or incur any liability under or
-29-
in respect of such agreement. Any reference in this Agreement to a "Fund" shall
be construed so as to give effect to the foregoing.
A copy of the Agreement and Declaration of Trust of Mentor Funds is on file with
the Secretary of The Commonwealth of Massachusetts, and notice is hereby given
that this instrument is executed on behalf of the Trustees of Mentor Funds as
Trustees and not individually and that the obligations of or arising out of this
instrument are not binding upon any of the Trustees or beneficiaries
individually, but binding only upon the assets and property of the Fund in
question.
28. Miscellaneous.
A. This Agreement shall be construed according to, and the rights and
liabilities of the parties hereto shall be governed by, the laws of the
State of Missouri.
B. All terms and provisions of this Agreement shall be binding upon, inure
to the benefit of and be enforceable by the parties hereto and their
respective successors and permitted assigns.
C. The representations and warranties, and the indemnification extended
hereunder, if any, are intended to and shall continue after and survive the
expiration, termination or cancellation of this Agreement.
D. No provisions of the Agreement may be amended or modified in any manner
except by a written agreement properly authorized and executed each party
hereto.
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E. The captions in the Agreement are included for convenience of reference
only, and in no way define or delimit any of the provisions hereof or
otherwise affect their construction or effect.
F. This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original but all of which together shall
constitute one and the same instrument.
G. If any part, term or provision of this Agreement is by the courts held
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.
H. This Agreement may not be assigned by any party hereto without prior
written consent of the other parties.
I. Neither the execution nor performance of this Agreement shall be deemed
to create a partnership or joint venture by and between Fund and IFTC.
J. Except as specifically provided herein, this Agreement does not in any
way affect any other agreements entered into among the parties hereto and
any actions taken or omitted by any party hereunder shall not affect any
rights or obligations of any other party hereunder.
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K. The failure of either party to insist upon the performance of any terms
or conditions of this Agreement or to enforce any rights resulting from any
breach of any of the terms or conditions of this Agreement, including the
payment of damages, shall not be construed as a continuing or permanent
waiver of any such terms, conditions, rights or privileges, but the same
shall continue and remain in full force and effect as if no such
forbearance or waiver had occurred.
L. This Agreement constitutes the entire agreement between the par-ties
hereto and supersedes any prior agreement, draft or agreement or proposal
with respect to the subject matter hereof, whether oral or written, and
this Agreement may not be modified except by written instrument executed by
both parties.
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WITNESS WHEREOF, the parties have caused this Agreement to be executed by
their respective duly authorized officers, to be effective the ____ day of
_________, 1998.
INVESTORS FIDUCIARY TRUST COMPANY
By:____________________________________
Title:__________________________________
MENTOR FUNDS
By:____________________________________
Title:___________________________________
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