Exhibit 9(a)
TRANSFER AGENCY AND SERVICE AGREEMENT
between
AARP INSURED TAX FREE INCOME TRUST
and
STATE STREET BANK AND TRUST COMPANY
TABLE OF CONTENTS
Article 1 Terms of Appointment; Duties of the Bank. .................... 1
Article 2 Fees and Expenses ............................................ 4
Article 3 Representations and Warranties of the Bank ................... 5
Article 4 Representations and Warranties of the Company ................ 5
Article 5 Indemnification .............................................. 6
Article 6 Covenants of the Company and the Bank ........................ 9
Article 7 Termination of Agreement ..................................... 10
Article 8 Additional Series ............................................ 11
Article 9 Assignment ................................................... 11
Article 10 Amendment .................................................... 11
Article 11 Massachusetts Law to Apply ................................... 12
Article 12 Form N-SAR ................................................... 12
Article 13 Merger of Agreement .......................................... 12
Article 14 Counterparts ................................................. 12
Article 15 Limitation of Liability of the Trustees and
the Shareholders ............................................. 12
TRANSFER AGENCY AND SERVICE AGREEMENT
AGREEMENT made as of the 1st day of September, 1988, by and between
AARP INSURED TAX FREE INCOME TRUST, a Massachusetts business trust, having its
principal office and place of business at 000 Xxxxxxx Xxxxxx, Xxxxxx,
Xxxxxxxxxxxxx 00000 (the "Company") and STATE STREET BANK AND TRUST COMPANY, a
Massachusetts trust company, having its principal office and place of business
at 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000 (the "Bank").
WHEREAS, the Company desires to appoint the Bank as a transfer agent,
dividend disbursing agent and agent in connection with certain other activities
and the Bank desires to accept such appointment;
WHEREAS, the Company offers shares in series (such series, together
with all other series subsequently established by the Company and made subject
to this Agreement in accordance with Article 8, being herein referred to as the
"Fund(s)");
WHEREAS, the Company's agent, Xxxxxxx Service Corporation ("Service"),
is responsible for the performance of certain shareholder, accounting,
administrative and servicing functions (collectively "Shareholder and
Record-Keeping Services");
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, the parties hereto agree as follows:
Article 1. Terms of Appointment; Duties of the Bank.
1.01. Subject to the terms and conditions set forth in this Agreement,
the Company hereby employs and appoints the Bank to act as, and the Bank agrees
to act as, transfer agent for the Company's authorized and issued shares of
beneficial interest, $.01 par value, ("Shares"), dividend disbursing agent and
agent in connection with any accumulation, open-account or similar plans
provided to the shareholders of the Company ("Shareholders") and set out in the
currently effective prospectuses and statements of additional information
("prospectus") of the Company, including without limitation any periodic
investment plan or periodic withdrawal program.
1.02. The Bank agrees that it will perform the following services:
(a) In accordance with procedures established from time to time by
agreement between the Company and the Bank, the Bank shall:
(i) Receive for acceptance, orders for the purchase of
Shares, and promptly deliver payment and appropriate
documentation thereof to the duly authorized custodian
of the Company (the "Custodian").
(ii) Pursuant to orders for the purchase of Shares, record
the purchase of the appropriate number of Shares in the
Shareholder's account and, if requested by the
Shareholder, and if the Trustees of the Company have
authorized the issuance of stock certificates, issue a
certificate for the appropriate number of Shares;
(iii) Pursuant to instructions provided by Shareholders,
reinvest income dividends and capital gain
distributions;
(iv) Receive for acceptance, redemption requests and
redemption directions and deliver the appropriate
documentation thereof to the Custodian;
(v) Forward all correspondence and rejected trades to
Service for response;
(vi) At the appropriate time as and when it receives monies
paid to it by the Custodian with respect to any
redemption, pay over or cause to be paid over in the
appropriate manner such monies as instructed by the
redeeming Shareholders;
(vii) Effect transfers of Shares by the registered owners
thereof upon receipt of appropriate instructions;
(viii) Prepare and transmit payments for dividends and
distributions declared by the Company;
(ix) Report abandoned property to the various states as
authorized by the Company per policies and principals
agreed upon by the Company and Bank;
(x) Maintain records of account for and advise the Company
and its Shareholders as to the foregoing; and
(xi) Record the issuance of Shares of the Company and
maintain, pursuant to SEC Rule 17Ad-10(e), a record of
the total number of Shares of the
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Company which are authorized, based upon data to it by
the Company, issued and outstanding. The Bank shall also
provide the Company on a regular basis with the total
number of Shares which are authorized, issued and
outstanding and shall have no obligation, when recording
the issuance of Shares, to monitor the issuance of such
Shares or to take cognizance of any laws relating to the
issue or sale of such Shares, which functions shall be
the sole responsibility of the Company.
(b) In addition to and neither in lieu nor in contravention of the
services set forth in the above paragraph (a), the Bank shall: (i) perform the
customary services of a transfer agent, dividend disbursing agent and, as
relevant, agent in connection with accumulation, open-account or similar plans
(including without limitation any periodic investment plan or periodic
withdrawal program) except such services as are provided by Service. The
detailed definition, frequency, limitations and associated costs (if any) set
out in the attached fee schedule, include but are not limited to: maintaining
all Shareholder accounts, preparing Shareholder meeting lists, mailing proxy
statements and proxies, receiving and tabulating proxies, mailing shareholder
reports and prospectuses to current Shareholders, withholding taxes on U.S.
residents and non-resident alien accounts where applicable, preparing and filing
U.S. Treasury Department Forms 1099 and other appropriate forms required with
respect to dividends and distributions by federal authorities for all registered
Shareholders, preparing and mailing confirmation forms and statements of account
to Shareholders for all purchases and redemptions of Shares and other
confirmable transactions in Shareholder accounts, preparing and mailing activity
statements for Shareholders, and providing Shareholder account information, (ii)
provide daily and monthly a written report and access to information on the
computer which will enable the Company to monitor the total number of Shares
sold and the aggregate public offering price thereof in each State by the
Company or each of the Funds, added by sales in each State of the registered
Shareholder or dealer branch office, as defined by the Company, and (iii) if
directed by the Company, (A) each confirmation of the purchase which establishes
a new account will be accompanied by a Prospectus and any amendment or
supplement thereto, and (B) a Prospectus, and any amendment or supplement
thereto, will be mailed to each Shareholder at the time a confirmation of the
first purchase by such Shareholder, subsequent to the effective date of a
Prospectus or any amendment or supplement thereto, is mailed to such
Shareholder.
(c) In addition, the Company shall (i) identify to the Bank in writing
those transactions and assets to be treated as exempt from blue sky reporting to
the Company for each state
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and (ii) approve those transactions to be included for each state on the system
prior to activation and thereafter monitor the daily activity for each state.
The responsibility of the Bank for the Company's blue sky State registration
status is solely limited to the initial establishment of transactions subject to
blue sky compliance by the Company and the reporting of such transactions as
provided above.
(d) The Bank shall utilize a system to identify all share transactions
which involve purchase and redemption orders that are processed at a time other
than the time of the computation of net asset value per share next computed
after receipt of such orders, and shall compute the net effect upon the Company
of such transactions so identified on a daily and cumulative basis.
(e) The Bank shall supply to the Company from time to time, as
mutually agreed upon, reports summarizing the transactions identified pursuant
to paragraph (d) above, and the daily and cumulative net effects of such
transactions, and shall advise the Company at the end of each month of the net
cumulative effect at such time. The Bank shall promptly advise the Company if at
any time the cumulative net effect exceeds a dollar amount equivalent to 1/2 of
1 cent per Share.
(f) Procedures as to who shall provide certain of these services in
Article 1 may be established from time to time by agreement between the Company
and the Bank per the attached service responsibility schedule. The Bank may at
times perform only a portion of these services and the Company or its agent may
perform these services on the Company's behalf.
Article 2. Fees and Expenses.
2.01. For the performance by the Bank pursuant to this Agreement, the
Company agrees to pay the Bank an annual maintenance fee for each Shareholder
account as set out in a fee schedule agreed to by both parties in writing. Such
fees and out-of-pocket expenses and advances identified under Section. 2.02
below may be changed from time to time subject to mutual written agreement
between the Company and the Bank.
2.02. In addition to the fee paid under Section 2.01 above, the
Company agrees to reimburse the Bank for out-of-pocket expenses or advances
incurred by the Bank for the items set out in the fee schedule agreed to by both
parties in writing. In addition, any other expenses incurred by the Bank at the
request or with the consent of the Company, will be reimbursed by the Company.
2.03. The Company agrees to pay all fees and reimbursable expenses
promptly, the terms, method and procedures
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for which are detailed on the fee schedule agreed to by both parties in writing.
Postage for mailing of dividends, proxy statements, Company reports and other
mailings to all Shareholder accounts shall be advanced to the Bank by the
Company at least two (2) days prior to the mailing date of such materials.
Article 3. Representations and Warranties of the Bank.
The Bank represents and warrants to the Company that:
3.01. It is a trust company duly organized and existing and in good
standing under the laws of the Commonwealth of Massachusetts.
3.02. It has the legal power and authority to carry on its business in
the Commonwealth of Massachusetts.
3.03. It is empowered under applicable laws and by its charter and
by-laws to enter into and perform this Agreement.
3.04. All requisite proceedings have been taken to authorize it to
enter into and perform this Agreement.
3.05. It is duly registered as a transfer agent under Section 17A of
the Securities Exchange Act of 1934, as amended.
3.06. It has and will continue to have access to the necessary
facilities, equipment and personnel to perform its duties and obligations under
this Agreement.
Article 4. Representations and Warranties of the Company.
The Company represents and warrants to the Bank that:
4.01. It is a business trust duly organized and existing and in good
standing under the laws of Massachusetts.
4.02. It is empowered under applicable laws and by its Declaration of
Trust and By-Laws to enter into and perform this Agreement.
4.03. All corporate proceedings required by said Declaration of Trust
and By-Laws have been taken to authorize it to enter into and perform this
Agreement.
4.04. It is an investment company registered under the Investment
Company Act of 1940, as amended.
4.05. A registration statement under the Securities Act of 1933 is
currently effective and will remain effective, and
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appropriate state securities law filings have been made and will continue to be
made, with respect to all Shares of the Company being offered for sale.
Article 5. Indemnification.
15.01. To the extent that the Bank acts in good faith and without
negligence or willful misconduct, the Bank shall not be responsible for, and the
Company shall indemnify and hold the Bank harmless from and against, any and all
losses, damages, costs, charges, counsel fees, payments, expenses and
liabilities arising out of or attributable to:
(a) All actions of the Bank or its agents or subcontractors required
to be taken pursuant to this Agreement.
(b) The Company's lack of good faith, negligence or willful misconduct
or which arise out of the breach of any representation or warranty of the
Company hereunder.
(c) The reasonable reliance on or use by the Bank or its agents or
subcontractors of information, records and documents or services which are
received or relied upon by the Bank or its agents or subcontractors and
furnished to it or performed by or on behalf of the Company.
(d) The reasonable reliance on, or the carrying out by the Bank or its
agents or subcontractors of, any written instructions or requests of the
Company.
(e) The offer or sale of Shares in violation of any requirement under
the federal securities laws or regulations, or the securities laws or
regulations of any state that such Shares be registered in such state, or in
violation of any stop order or other determination or ruling by any federal
agency or any state with respect to the offer or sale of such Shares in such
state, unless such violation is the result of the Bank's negligent or willful
failure to comply with the provisions of Section 1.02(b) of this Agreement.
5.02. The Bank shall indemnify and hold the Company harmless from and
against any and all losses, damages, costs, charges, counsel fees, payments,
expenses and liabilities arising out of or attributable to the Bank's refusal or
failure to comply with the terms of this Agreement (whether as a result of the
acts or omissions of the Bank or of its agents or subcontractors) or arising out
of the Bank's or its agent's or subcontractor's lack of good faith, negligence
or willful misconduct, or arising out of the breach of any representation or
warranty of the Bank hereunder.
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5.03. At any time the Bank may apply to any officer of the Company for
instructions, and may consult with legal counsel with respect to any matter
arising in connection with the services to be performed by the Bank under this
Agreement, and the Bank and its agents or subcontractors shall not be liable and
shall be indemnified by the Company for any action reasonably taken or omitted
by it in reliance upon such instructions or upon the opinion of such counsel.
The Bank, its agents and subcontractors shall be protected and indemnified in
acting upon any paper or document furnished by or on behalf of the Company,
reasonably believed to be genuine and to have been signed by the proper person
or persons, or upon any instruction, information, data, records or documents
provided the Bank or its agents or subcontractors by machine readable input,
telex, CRT data entry or other similar means authorized by the Company, and
shall not be held to have notice of any change of authority of any person, until
receipt by the Bank of written notice thereof from the Company. The Bank, its
agents and subcontractors shall also be protected. and indemnified in
recognizing stock certificates which are reasonably believed to bear the proper
manual or facsimile signatures of the officers of the Company, and the proper
countersignature of any former transfer agent or registrar, or of a co-transfer
agent or co-registrar.
5.04. In the event either party is unable to perform its obligations
under the terms of this Agreement because of acts of God, strikes, equipment or
transmission failure or damage reasonably beyond its control, or other causes
reasonably beyond its control, such party shall not be liable for damages to the
other for any damages resulting from such failure to perform or otherwise from
such causes.
5.05. Neither party to this Agreement shall be liable to the other
party for consequential damages under any provision of this Agreement, but each
shall be liable for general damages resulting from breach of this Agreement. For
the purposes of this Agreement, the term "general damages" shall include but
shall not be limited to:
(a) All costs of correcting errors made by the Bank or its agents or
subcontractors in Company shareholder accounts, including the
expense of computer time, computer programming and personnel;
(b) Amounts which the Company is liable to pay to a person (or his
representative) who has purchased or redeemed, or caused to be
repurchased, Shares at a price which is higher, in the case of a
purchase, or lower, in the case of a redemption or repurchase,
than correct net asset value per Share, but only to the extent
that the price at
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which such Shares were purchased, redeemed or repurchased was
incorrect as a result of either (i) one or more errors caused by
the Bank or its agents or subcontractors in processing
shareholder accounts of the Company or (ii) the posting by the
Bank of the purchase, redemption or repurchase of Shares
subsequent to the time such purchase, redemption or repurchase
should have been posted pursuant to laws and regulations
applicable to open-end investment companies, if the delay is
caused by the Bank, its agents or subcontractors;
(c) The value of dividends and distributions which were not credited
on Shares because of the failure of the Bank or its agents or
subcontractors to timely post the purchase of such Shares;
(d) The value of dividends and distributions which were incorrectly
credited on Shares because of the failure of the Bank or its
agents or subcontractors to timely post the redemption or
repurchase of such Shares;
(e) The value of dividends and distributions, some portion of which
was incorrectly credited, or was not credited on Shares because
of the application by the Bank or it agents or subcontractor of
an incorrect dividend or distribution factor or otherwise;
(f) Penalties and interest which the Company is required to pay
because of the failure of the Bank or its agents or
subcontractors to comply with the information reporting and
withholding (including backup withholding) requirements of the
Internal Revenue Code of 1986, as amended, and applicable
Treasury regulations thereunder, applicable to Company
Shareholder accounts; and
(g) Interest in accordance with the laws of the Commonwealth of
Massachusetts on any damages from the date of the breach of this
Agreement.
5.06. In order that the indemnification provisions contained in this
article shall apply, upon the assertion of a claim for which either party may be
required to indemnify the other, the party seeking indemnification shall
promptly notify the other party of such assertion, and shall keep the other
party advised with respect to all developments concerning such claim. The party
who may be required to indemnify shall have the option
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to participate with the party seeking indemnification in the defense of such
claim. The party seeking indemnification shall in no case confess any claim or
make any compromise in any case in which the other party may be required to
indemnify it except with the other party's prior written consent.
5.07. Losses incurred by the Company arising from the Bank effecting a
share transaction at a trade (pricing) date prior to the processing date shall
be governed by a separate agreement between the Bank and the Company.
The obligations of the parties hereto under this Article 5 shall
survive the termination of this Agreement.
Article 6. Covenants of the Company and the Bank.
6.01. The Company shall promptly furnish to the Bank the following:
(a) A certified copy of the resolution of the Board of Trustees of the
Company authorizing the appointment of the Bank and the execution and delivery
of this Agreement.
(b) A copy of the Declaration of Trust and By-Laws of the Company and
all amendments thereto.
6.02. The Bank hereby agrees to establish and maintain facilities and
procedures reasonably acceptable to the Company for safekeeping of stock
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.
6.03. The Bank shall at all times maintain insurance coverage which is
reasonable and customary in light of its duties hereunder and its other
obligations and activities.
6.04. The Bank shall keep records relating to the services to be
performed hereunder, in the form and manner as it may deem advisable. To the
extent required by Section 31 of the Investment Company Act of 1940, as amended,
and the Rules thereunder, the Bank agrees that all such records prepared or
maintained by the Bank relating to the services to be performed by the Bank
hereunder and those records that the Company and the Bank agree from time to
time to be the records of the Company are the property of the Company and will
be preserved, maintained and made available in accordance with such Section and
Rules, and will be surrendered promptly to the Company on and in accordance with
its request. Records surrendered hereunder shall be in machine readable form,
except to the extent that the Bank has maintained such a record only in paper
form.
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6.05. The Bank and the Company agree that all books, records,
information and data pertaining to the business of the other party which are
exchanged or received pursuant to the negotiation or the carrying out of this
Agreement shall remain confidential and shall not be voluntarily disclosed to
any other person, except as may be required by law.
6.06. In case of any requests or demands for the inspection of the
Shareholder records of the Company, the Bank will endeavor to notify the Company
and to secure instructions from an authorized officer of the Company as to such
inspection. The Bank reserves the right, however, to exhibit the Shareholder
records to any person whenever it is advised by its counsel that it may be held
liable for the failure to exhibit the Shareholder records to such person.
6.07. The Bank agrees to maintain redundant facilities or a compatible
configuration and to backup the Company's master and input files and to store
such files in a secure off-premises location so that in the event of a power
failure or other interruption of whatever cause at its principal place of
business, the Company's records are maintained intact and transactions can be
processed at another location.
6.08. The Bank acknowledges that the Company, as a registered
investment company under the Investment Company Act of 1940, as amended, (the
"Act") is subject to the provisions of the Act and the rules and regulations
thereunder, and that the offer and sale of the Company's Shares are subject to
the provisions of federal and state laws and regulations applicable to the offer
and sale of securities. The Company acknowledges that the Bank is not
responsible for the Company's compliance with such laws and regulations. If the
Company advises the Bank that a procedure of the Bank related to the discharge
of its obligations hereunder has or may have the effect of causing the Company
to violate any of such laws or regulations, the Bank shall use its best efforts
to develop a mutually agreeable alternative procedure which does not have such
effect.
Article 7. Termination of Agreement.
7.01. This Agreement may be terminated by either party upon one
hundred twenty (120) days written notice to the other.
7.02. Should the Company exercise its right to terminate, all
reasonable out-of-pocket expenses of the Bank associated with the movement of
records and materials required by this Agreement will be borne by the Company.
Additionally, the Bank reserves the right to charge for any other reasonable
expenses associated with such termination.
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Article 8. Additional Series.
8.01. In the event that the Company establishes one or more series of
Shares with respect to which it desires to have the Bank render services as
transfer agent under the terms hereof, it shall so notify the Bank in writing,
and unless the Bank objects in writing to providing such services, the term
"Company" hereunder, unless the context otherwise requires, shall be deemed to
include each such series of Shares. All recordkeeping and reporting shall be
done separately for each series. Unless the Company and the Bank agree to an
amended fee schedule, the fee schedule attached hereto shall apply to each
series separately.
Article 9. Assignment.
9.01. Except as provided in Section 9.03 below, neither this Agreement
nor any rights or obligations hereunder may be assigned by either party without
the written consent of the other party.
9.02. This Agreement shall inure to the benefit of and be binding upon
the parties and their respective permitted successors and assigns.
9.03. The Bank may, without further consent on the part of the
Company, subcontract for the performance hereof with (i) Boston Financial Data
Services, Inc., a Massachusetts corporation ("BFDS") which is duly registered as
a transfer agent pursuant to Section 17A(c)(1) of the Securities Exchange Act
of 1934 ("Section 17A(c)(1)"), (ii) a BFDS subsidiary duly registered as a
transfer agent pursuant to Section 17A(c)(1), if the Company consents to the
use of such subsidiary, which consent shall not be unreasonably withheld, or
(iii) a BFDS affiliate if the Company consents to the use of such affiliate,
which consent shall not be unreasonably withheld; provided, however, that the
Bank shall be as fully responsible to the Company for the acts and omissions of
any subcontractor as it is for its own acts and omissions.
Article 10. Amendment.
10.01. This Agreement may be amended or modified by a written
agreement executed by both parties and authorized or approved by a resolution of
the Board of Directors or Trustees of each party.
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Article 11. Massachusetts Law to Apply.
11.01. This Agreement shall be construed and the provisions thereof
interpreted under and in accordance with the laws of the Commonwealth of
Massachusetts.
Article 12. Form N-SAR.
12.01. The Bank shall maintain such records as shall enable the
Company to fulfill the requirements of Form N-SAR.
Article 13. Merger of Agreement.
13.01. This Agreement constitutes the entire agreement between the
parties hereto and supersedes any prior agreement with respect to the subject
hereof whether oral or written.
Article 14. Counterparts.
14.01. This Agreement may be executed by the parties hereto on any
number of counterparts, and all of said counterparts taken together shall be
deemed to constitute one and the same instrument.
Article 15. Limitation of Liability of the Trustees and the Shareholders.
It is understood and expressly stipulated that none of the Trustees,
officers, agents, or shareholders of the Company shall be personally liable
hereunder. The name "AARP INSURED TAX FREE INCOME TRUST" is the designation of
the Trustees for the time being under a Declaration of Trust dated June 8, 1984,
as amended from time to time, and all persons dealing with the trust must look
solely to the property of the trust for the enforcement of any claims against
the trust as neither the Trustees, officers, agents or shareholders assume any
personal liability for obligations entered into on behalf of the trust. No
series shall be liable for the obligations of any other series.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed in their names and on their behalf under their seals by and through
their duly authorized officers, as of the day and year first above written.
ATTEST: AARP INSURED TAX FREE INCOME TRUST
/s/ [Illegible] BY: /s/ [Illegible]
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Vice President
ATTEST: STATE STREET BANK AND TRUST COMPANY
/s/ [Illegible] BY: /s/ [Illegible]
---------------------------------- -------------------------------
Assistant Secretary Vice President
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