TRANSFER AGENCY AGREEMENT
THIS AGREEMENT made this day of 2002 by and between
COMMONWEALTH CASH RESERVE FUND, INC., a Virginia corporation
(the "Fund"), and PFM ASSET MANAGEMENT LLC, a Delaware
corporation ("PFM").
W - I - T - N - E - S - S - E - T - H:
WHEREAS, the Fund is a registered open-end, diversified,
management investment company under the Investment Company
Act of 1940, as amended (the "1940 Act").
WHEREAS the Fund desires to retain PFM to serve as the
Fund's transfer agent, registrar and dividend dispersing
agent, and PFM is willing to furnish such services;
NOW THEREFORE, in consideration of the premises and the
mutual convenants herein
contained, it is agreed between the parties hereto as
follows:
1. Appointment. The Fund hereby appoints PFM to serve
as transfer agent, registrar and dividend disbursing agent
for the Fund, for the periods and times set forth in this
Agreement. PFM accepts such appointment and agrees to
furnish the services herein set forth in return for
the compensation as provided for in section 16 of this
Agreement.
2. Delivery of Documents. The Fund has furnished PFM with
copies properly certified or authenticated of each of the
following:
(a) Resolutions of the Board of Directors of the Fund
authorizing the execution of this Agreement;
(b) Appendix A identifying and containing the signatures of
the Fund's officers and other persons authorized to sign
Written Instruction and give Oral Instructions, each as
hereinafter defined, on behalf of the Fund;
(c) A copy of the Fund's Articles of Incorporation filed
with the Secretary of the State Corporation Commission of
the Commonwealth of Virginia on December 8, 1986, as
amended and presently in effect (the "Articles");
(d) The Fund's By-laws and all amendments thereto
(such By-Laws, as presently in effect and as they shall
from time to time be amended are herein called the "By-
laws");
(e) Resolutions of the Fund's Board of Directors approving
the Advisory Agreement between the Fund and PFM Asset
Management LLC (the "Adviser");
(f) Resolutions of the Fund's Board of Directors approving
the Plan of Distribution and also the Distribution Agreement
between the Fund and Commonwealth Financial Group, Inc.
(the "Distributor");
(g) Resolutions of the Fund's Board of Directors approving
the Administration Agreement between the Fund and PFM Asset
Management LLC (the "Administrator");
(h) The Fund's Notification of Registration filed pursuant
to Section 8(a) of the 1940 Act on form N-8A as filed with
the Securities and Exchange Commission ("SEC") on December
11, 1986;
(i) The Fund's Registration Statement on Form N-1A under
the Securities Act of 1933, as amended (the "1933 Act")
(File No. 33-10754) and under the 1940 Act as filed with
the SEC on December 11, 1986 relating to the shares of the
Fund, and all amendments thereto; and
(j) The Fund's most recent Prospectus and Statement of
Additional Information (such prospectus and statement of
additional information, as presently in effect and all
amendments and supplements thereto are herein called the
"Prospectus"). The Fund will furnish PFM from time to
time with copies, properly certified or authenticated,
of all amendments of or supplements to the foregoing, if
any.
3. Definitions.
(a) "Authorized Person". As used in this Agreement, the
term "Authorized Person" means an officer of the Fund or
other person duly authorized by the Board of Directors of
the Fund to give Oral or Written Instructions on behalf of
the Fund and listed on the Certificate annexed hereto as
Appendix A or any amendment thereto as may be received by
PFM from time to time.
(b) "Oral Instructions". As used in this Agreement, the
term "Oral Instructions" means verbal instruction actually
received by PFM from an Authorized Person or from a person
reasonably believed by PFM to be an Authorized Person.
(c) "Shares". As used in this agreement, the term
"Shares" means shares of common stock, no par value, of
the Commonwealth Cash Reserve Fund, Inc.
(d) "Shareholder". As used in this Agreement, the term
"Shareholder" means a holder of Shares.
(e) "Written Instructions". As used in this Agreement
the term "Written Instructions" means written instructions
delivered by hand, mail, tested telegram, cable, telex or
facsimile sending device, and received by PFM and signed
by an Authorized Person unless the Board of Directors of
the Fund specifies otherwise pursuant to a resolution
furnished to PFM pursuant to Section 2(a) hereof.
4. Instructions Consistent with Articles, etc.
(a) Unless otherwise provided in this Agreement, PFM
shall act only upon Oral or Written Instructions. Although
PFM may take cognizance of the provisions of the Articles
and By-laws of the Fund, PFM may assume that Oral or Written
Instructions received hereunder are not inconsistent with
any provisions of such Articles or By-laws or any vote,
resolution or proceeding of the Shareholders, of the
Board of Directors, or any committee thereof.
(b) PFM shall be entitled to rely upon Oral or Written
Instructions actually received by PFM pursuant to this
Agreement. The Fund agrees to forward to PFM Written
Instructions confirming Oral Instructions in such a
manner that the Written Instructions are received by PFM,
whether by hand delivery, telex, facsimile sending device
or otherwise, as promptly as practicable after Oral
Instructions are given to PFM. The Fund agrees that the
fact that such confirming Written Instructions are not
received by PFM shall in no way affect the validity of
the transactions authorized by the Fund by giving Oral
Instructions. The Fund agrees that PFM shall incur no
liability to the Fund in acting upon Oral Instructions
given to PFM hereunder concerning such transactions
provided such instructions reasonably appear to have
been received from an Authorized Person.
5. Transactions Not Requiring Instructions.
(a) In the absence of contrary Written Instructions,
PFM is authorized to take the following actions:
(i) issuance, transfer and redemption of Shares in
the manner described in the Prospectus and in conformity
with the rules and regulations of the SEC and the laws
of the Commonwealth of Virginia;
(ii) opening, maintenance, servicing and closing of
accounts of Shareholders or prospective Shareholders;
(iii) acting as agent of the Fund in connection with
accounts, upon the terms and subject to the conditions
contained in the application relating to the account;
(iv) causing the reinvestment in Shareholders'
accounts of dividends and distributions declared upon
Shares;
(v) processing redemptions;
(vi) examining and approving legal transfers;
(vii) furnishing to Shareholders confirmations of
transactions relating to their Shares;
(viii) preparing and mailing to the Internal
Revenue Service and all payees all information returns
and payee statements required under the Internal Revenue
Code in respect to the Fund's dividends and distributions
and taking all other necessary action in connection with
the dividend withholding requirements of that Code;
(ix) mailing to Shareholders, confirmations of
purchases and redemptions, monthly statements, annual and
semiannual reports prepared on behalf of the Fund, and,
if so requested by the Fund, mailing new Prospectuses
upon their issue to Shareholders;
(x) preparation and sending such other information
from the Fund's records held by PFM as may be reasonably
requested by the Fund;
(xi) maintaining such books and records relating to
transactions effected by PFM as are required by the 1940
Act, or by any other applicable provision of law, to be
maintained by the Fund or its transfer agent with respect
to such transactions, and preserving, or causing to be
preserved, any books and records for such periods as
may be required by any law, rule or regulation.
(b) PFM agrees to act as proxy agent in connection with
the holding of annual or special meetings or Shareholders,
mailing to such Shareholders notices, proxies, and proxy
statements in connection with the holding of such meetings
(all of such writings to be prepared by the Fund at the
Fund's cost), receiving and tabulating votes cast by proxy
and communicating to the Fund the results of such tabulation
accompanied by appropriate certificates, and preparing and
furnishing to the Fund certified lists of Shareholders as
of such date, and in such form and containing such
information as may be required by the Fund to comply with
any applicable provisions of the law or the Articles and
By-laws relating to such meetings.
(c) PFM agrees to furnish to the Fund such information
and at such intervals as is necessary for the Fund to
comply with the registration requirements and/or reporting
requirements of the SEC, Blue Sky Authorities or other
regulatory agencies. PFM will, in addition to the
services herein itemized, perform and do all other acts
and services that are customarily performed and done by
other transfer agents, dividend disbursing agents, and
shareholder servicing agents of open-end mutual funds
of the "money market fund" type.
(d) PFM agrees to provide to the Fund upon request such
information as may reasonably be required to enable the
Fund to reconcile the number of outstanding Shares of the
Fund between its records and the account books of the Fund.
6. Authorized Shares. Shall be the number of shares
authorized by the Articles of Incorporation as may be
amended from time to time.
7. Dividends and Distributions. The Fund shall furnish
PFM with appropriate evidence of action by the Fund's
Board of Directors authorizing the daily declaration of
dividends and distributions in respect of Shares as
described in the Prospectus. After deducting any
amount required to be withheld by any applicable tax
laws, rules and regulations, PFM shall, as agent of each
Shareholder and in accordance with the instructions in
proper form from a Shareholder and the provisions of the
Fund's Articles and the Prospectus, invest such dividends
and distributions in Shares in the manner described in the
Prospectus or if the Shareholder so elects and if the Fund
and PFM should agree to permit such option, pay them in cash.
PFM shall prepare, file with the Internal Revenue Service,
and address and mail to Shareholders such returns and
information relating to dividends and distributions
paid by the Fund as are required to be so prepared, filed
and mailed by applicable laws, rules and regulations, or
such substitute form of notice as may from time to time
be permitted or required by the Internal Revenue Service.
On behalf of the Fund, PFM shall withhold and pay on a
timely basis to the appropriate federal authorities any
taxes required by applicable Federal tax laws to be
withheld on dividends and distributions paid by the Fund.
8. Communications with Shareholders.
(a) Communications to Shareholders. Upon request of the
Fund PFM will address and mail all communications by the
Fund to its Shareholders, including reports to Shareholders,
dividend and distribution notices and proxy material for
the Fund's meetings of Shareholders. PFM will receive and
tabulate the proxy cards for the meetings of the Fund's
shareholders.
(b) Correspondence. PFM will answer such correspondence
received by it from Shareholders and others relating to its
duties hereunder and such other correspondence as may from
time to time be mutually agreed upon between PFM and the
Fund.
9. Records. PFM shall keep the following records:
(a) accounts for each Shareholder showing the following
information:
(i) name, address and United States Tax Identification
or Social Security Number;
(ii) number of Shares held for which certificates, if
any, have been issued, including certificate numbers and
denominations;
(iii) historical information regarding the account of
each Shareholder, including dividends and distributions
paid and the date and price of all transactions on each
Shareholder's account;
(iv) any stop or restraining order placed against a
Shareholder's account;
(v) any correspondence relating to the current maintenance
of a Shareholder's account;
(vi) any information required in order for PFM to perform
any calculations contemplated or required by this Agreement.
(b) Sub-Accounts for each Shareholder requesting such
services in connection with Shares held by such Shareholder
for separate accounts containing the same information
for each sub-account as required by sub-section (a) above.
(c) The books and records pertaining to the Fund which are
in the possession of PFM shall be the property of the Fund.
Such books and records shall be prepared and maintained as
required by the 1940 Act and other applicable securities
laws, rules and regulations. The Fund, or the Fund's
authorized representatives, shall have access to such
books and records at all times during PFM's normal business
hours. Upon the reasonable request of the Fund, copies of
any such books and records shall be provided by PFM to the
Fund or the Fund's authorized representatives at the Fund's
expense.
10. Reports. PFM shall furnish the Fund such periodic and
special reports and such other information, including
Shareholder lists and statistical information concerning
accounts as may be agreed upon from time to time between
the Fund and PFM.
11. Cooperation with Accountants. PFM shall cooperate with
the Fund's independent public accountants and shall take
all reasonable action in the performance of its obligations
under this Agreement to assure that the necessary
information is made available to such accountants for the
expression of their unqualified opinion, including but not
limited to the opinion included in the Fund's annual report
on form N-1R.
12. PFM will treat confidentially and as proprietary
information of the Company all records and other information
relative to the Company and prior, present or potential
shareholders, and will not use such records and information
for any purpose other than performance of its responsibilities
and duties hereunder (except after prior notification to and
approval in writing by the Company, which approval shall not
be unreasonably withheld and may not be withheld and will be
deemed granted where the Adviser may be exposed to civil or
criminal contempt proceedings for failure to comply, when
requested to divulge such information by duly constituted
authorities, or when so requested by the Company).
13. Services Not Exclusive. The services furnished by the
Adviser hereunder are deemed not to be exclusive, and the
Adviser shall be free to furnish similar services to others
so long as its services under this Agreement are not impaired
thereby.
00.Xxxxxxxxx Failures. In the event of equipment failures
beyond PFM's control, PFM shall, at no additional expense to
the Fund, take reasonable steps to minimize service
interruptions but shall have no liability with respect thereto.
The foregoing obligation shall not extend to computer terminals
located outside of the premises maintained by PFM. PFM shall
enter into and shall maintain in effect one or more agreements
with appropriate parties making reasonable provision for
emergency use of electronic data processing equipment to the
extent that appropriate equipment is available.
15. Rights to Receive Advice.
(a) Advice of Fund. If PFM shall be in doubt as to any
action to be taken or omitted by it, it may request, and
shall receive from the Fund, directions or advice, including
Oral or Written Instructions where appropriate.
(b) Advice of Counsel. If PFM shall be in doubt as to any
question of law involved in any action to be taken or omitted
by PFM, it may request advice at its own cost from counsel of
its own choosing (who may be counsel for the Advisor, the
Fund, the Administrator, any custodian of the Fund, or the
Distributor, at the option of PFM).
(c) Conflicting Advice. In case of conflict between directions,
advice or Oral or Written Instructions received by PFM pursuant
to sub-section (a) of this section and advice received by PFM
pursuant to sub-section (b) of this section, PFM shall be
entitled to rely on and follow the advice received pursuant
to sub-section (b) of this section.
(d) Protection of PFM. PFM shall be protected in any action
or inaction which it takes in reliance on any directions,
advice or Oral or Written Instruction received pursuant to
sub-sections (a) or (b) of this section and which PFM, after
receipt of any such directions, advice or Oral or Written
Instructions, believes in good faith to be consistent with
such directions, advice or Oral or Written Instructions, as
the case may be. However, nothing in this sub-section
shall be construed as imposing upon PFM any obligation
(i) to seek such directions, advice or Oral of Written
Instructions, or (ii) to act in accordance with such
directions, advice or Oral or Written Instructions when
received, unless, under the terms of another provision of
this Agreement, the same is a condition to PFM's properly
taking or omitting to take such action. Nothing in this
sub-section shall excuse PFM when an action or omission on
the part of PFM constitutes willful misfeasance, bad faith,
gross negligence or reckless disregard by PFM of any duties,
obligations or responsibilities not expressly provided for
in this Agreement or results from PFM's negligent failure to
perform its duties expressly provided for in this Agreement
or otherwise agreed to in writing by PFM.
16. Compliance with Governmental Rules and Regulations.
The Fund assumes full responsibility for insuring that the
contents of each Prospectus and Statement of Additional
Information and complies with all applicable requirements
of the 1933 Act, the 1940 Act, and any laws, rules and
regulations of governmental authorities having jurisdiction.
17. Compensation. As compensation for the services
rendered by PFM during the term of this Agreement, PFM
shall be entitled to receive reimbursement for out-of-
pocket expenses attributable to the performance of its
duties under this Agreement and such compensation as the
parties may from time to time agree in writing.
18. Indemnification. The Fund agrees to indemnify and
hold harmless PFM and its nominees from all taxes, charges,
expenses, assessments, claims and liabilities (including,
without limitation, liabilities under the 1933 Act, the
Securities and Exchange Act of 1934, the 1940 Act, and any
state and foreign blue sky laws, all as to be amended from
time to time) and expenses, including, without limitation,
attorney's fees and disbursements, arising directly or
indirectly from any action or thing which PFM takes or
does or omits to take or do (i) at the request or on the
direction of or in reliance on the advice of the Fund,
or (ii) upon Oral or Written Instructions, provided that
neither PFM nor any of its nominees shall be indemnified
against any liability to the Fund or to its Shareholders
(or any expenses incident to such liability) arising out
of (x) PFM's or such nominee's willful misfeasance, bad
faith or gross negligence or reckless disregard of its
duties in connection with the performance of any duties,
obligations or responsibilities not expressly provided for
in this Agreement, or (y) PFM's or such nominee's own
negligent failure to perform its duties expressly provided
for in this Agreement or otherwise agreed to by PFM in
writing.
19. Responsibility of PFM. PFM shall be under no duty to
take any action on behalf of the Fund except as
specifically set forth herein or as may be specifically
agreed by PFM in writing. In the performance of its
duties hereunder, PFM shall be obligated to exercise
care and diligence and to act in good faith and to use
its best efforts within reasonable limits to insure the
accuracy and completeness of all services performed under
this Agreement. PFM shall be responsible for its own
negligent failure to perform its duties under this
Agreement, but to the extent that duties, obligations and
responsibilities are not expressly set forth in this
Agreement, PFM shall not be liable to any act or omission
which does not constitute willful misfeasance, bad faith
or gross negligence on the part of PFM or reckless
disregard of such duties, obligations and responsibilities.
Without limiting the generality of the foregoing or of any
other provision of this Agreement, PFM, in connection with
its duties under this Agreement shall not be under any
duty or obligation to inquire into and shall not be
liable for or in respect of (a) the validity or invalidity
or authority or lack or authority of any Oral or Written
Instructions, notice or other instrument which conforms to
the applicable requirements of this Agreement, if any, and
which PFM reasonably believes to be genuine, or (b) delays
or errors or loss of data occurring by reason or
circumstances beyond PFM's control, including
acts of civil or military authority, national emergencies,
labor difficulties, fire, mechanical breakdown (except as
provided in section 13), flood or catastrophe, acts of God,
insurrection, war, riots or failure of the mails,
transportation, communication or power supply.
20. Release. PFM understands that the obligations of this
Agreement are not binding upon any Shareholder of the Fund
personally, but bind only the Fund's property.
21. Termination. This Agreement shall continue until
termination by the Fund on 60 days' written notice or by
PFM on 90 days' written notice.
22. Notices. All notices and other communications,
including Written Instructions (collectively referred to
as "Notice" or "Notices" in this section), hereunder shall
be in writing or by confirming telegram, cable, telex or
facsimile sending device, or reliable courier. Notices
shall be addressed (a) if to PFM at PFM's address, (b) if
to the Fund, at the address of the Fund; or (c) if to
neither of the foregoing, at such other address as shall
have been notified to the sender of any such Notice or
other communication. If the location of the sender of a
Notice and the address of the addressee thereof are, at
the time of the sending, more than 100 miles apart, the
Notice may be sent by first class mail, in which case it
shall be deemed to have been given 5 days after it is sent,
or if sent by confirming telegram, cable, telex or
facsimile sending device, it shall be deemed to have been
given immediately, and if the location of the sender of a
Notice and the addressee are, at the time of sending, not
more than 100 miles apart, the Notice may be sent by first
class mail, in which case it shall be deemed to have been
given three days after it is sent, or if sent by messenger,
it shall be deemed to have been given on the day it is
delivered, or if sent by confirming telegram, cable,
telex or facsimile sending device, it shall be deemed to
have been given immediately. All postage, cable, telegram,
telex and facsimile sending charges arising from the
sending of a Notice hereunder shall be paid by the sender.
23. Further Actions. Each party agrees to perform such
further acts and execute such further documents as are
necessary to effectuate the purposes hereof.
24. Amendments. This Agreement or any part hereof may
be changed or waived only by an instrument in writing
signed by the party against which enforcement of such
change or waiver is sought.
25. Assignment. This Agreement and the performance
hereunder may not be assigned by PFM without the Fund's
prior consent.
26. Miscellaneous. This Agreement embodies the entire
agreement and understanding between the parties hereto,
and supercedes all prior agreements and understandings
relating to the subject matter hereof, provided that
the parties hereto may embody in one or more separate
documents their agreement, if any, with respect to Oral
Instructions. The captions in this Agreement are included
for convenience or reference only and in no way define or
delimit any of the provisions hereof or otherwise affect
their construction or effect. This Agreement shall be
deemed to be a contract made in Virginia and governed
by Virginia law. If any provision of this Agreement
shall be held or made invalid by a court decision,
statute, rule or otherwise, the remainder of this
Agreement shall be binding and shall inure to the
benefit of the parties and their respective successors.
IN WITNESS WHEREOF, the parties hereto have
caused this Agreement to be executed by their officers
designated below on the day and year first above
written.
COMMONWEALTH CASH RESERVE FUND, INC.
BY: ________________________________
PFM ASSET MANAGEMENT LLC
BY: _________________________________
