SHAREHOLDER ACCOUNT SERVICING AGREEMENT
THIS AGREEMENT, made this 13th day of December 1995, by and between Piper Funds
Inc.--II, a Minnesota corporation (the "Company"), on behalf of Adjustable Rate
Mortgage Securities Fund, the Company's sole series of common stock, and Xxxxx
Xxxxxxx Inc., a Delaware corporation ("Xxxxx Xxxxxxx").
WITNESSETH:
WHEREAS, the Company has entered into an Agency Agreement with Investors
Fiduciary Trust Company ("IFTC") pursuant to which IFTC was appointed as
Transfer Agent and Dividend Disbursing Agent for the Funds; and
WHEREAS, management of the Company has determined that it would be in the best
interests of each Fund and its shareholders to maintain with IFTC certain
omnibus accounts, with each such account representing the accounts of a number
of individual shareholders who maintain accounts with Xxxxx Xxxxxxx, and to have
Xxxxx Xxxxxxx provide transfer agent and dividend disbursing agent services for
such underlying individual shareholder accounts.
NOW, THEREFORE, in consideration of the premises and mutual covenants contained
herein, the parties hereto agree as follows:
1. Scope of Appointment.
(a) Subject to the conditions set forth in this Agreement, the Company
hereby appoints Xxxxx Xxxxxxx to perform certain transfer agent and
dividend disbursing agent services, and Xxxxx Xxxxxxx accepts such
appointment.
(b) Such services shall be provided with respect to all individual
shareholder accounts encompassed within the omnibus accounts
referenced above.
(c) Xxxxx Xxxxxxx agrees to provide the necessary facilities, equipment
and personnel to perform its duties and obligations hereunder in
accordance with industry practice.
(d) Xxxxx Xxxxxxx agrees to perform the usual and ordinary services of
transfer agent and dividend disbursing agent not performed by IFTC
with respect to the shareholder accounts outlined in Section 1(b),
including, without limitation, the following: maintaining all
shareholder accounts; preparing shareholder meeting lists; mailing
shareholder reports and prospectuses; tracking shareholder accounts
for blue sky and Rule 12b-1 purposes; withholding taxes on
non-resident alien and foreign corporation accounts; preparing and
mailing checks for disbursement of income dividends and capital gains
distributions; preparing and filing U.S. Treasury Department Form 1099
for all shareholders; preparing and mailing confirmation forms to
shareholders and dealers with respect to all purchases, exchanges and
liquidations of Fund shares and other transactions in shareholder
accounts for which confirmations are required; recording reinvestments
of dividends and distributions in Fund shares; recording redemptions
of Fund shares; and preparing and mailing checks for payments upon
redemption and for disbursements to withdrawal plan holders.
(e) Xxxxx Xxxxxxx shall perform all services relating to shareholder
transactions, share redemptions and maintaining shareholder accounts
on the same business day as the request for the transaction is
received. Xxxxx Xxxxxxx shall perform all services relating to payouts
of monies no later than three business days following the date of
receipt of the request for the transaction. Xxxxx Xxxxxxx shall
perform all services relating to the provision of confirmations no
later than three business days following the transaction. Any
activities not enumerated will be fulfilled no later than the time
required by applicable law. In each case the time standards will be
adjusted to meet any applicable requirements of law. The time frames
above include not only the performance of the activity, but the
appropriate quality control and mailing of the related checks,
confirms, letters or other documents.
Xxxxx Xxxxxxx will maintain records of its performance, available to the Company
for inspection upon reasonable notice.
2. Compensation. As compensation for the services to be provided by Xxxxx
Xxxxxxx hereunder, each Fund will pay to Xxxxx Xxxxxxx an annual per-account fee
as set forth in Exhibit A hereto. Such fee shall be payable on a monthly basis
at a rate of 1/12th of the annual per-account charge, with payment being made
within ten business days following the end of the month covered by such payment.
Such fee covers all services outlined in Section 1(d) with the exception of
preparing shareholder meeting lists and mailing shareholder reports and
prospectuses. These services, along with proxy processing (if applicable) and
other special service requests, will be billable as performed at a mutually
agreed upon fee in addition to the annual fee as noted, provided that such
mutually agreed upon fee shall be fair and reasonable in light of the usual and
customary charges made by others for services of the same nature and quality.
3. Records.
(a) Xxxxx Xxxxxxx will maintain customary records in connection with its
agency appointment hereunder, and in particular will maintain those
records required to be maintained pursuant to subparagraph 2(iv) of
paragraph (b) of Rule 31a-1 under the Investment Company Act of 1940,
as amended (the "1940 Act").
(b) To the extent required by Section 31 of the 1940 Act and the rules and
regulations thereunder, Xxxxx Xxxxxxx agrees that all records
maintained by Xxxxx Xxxxxxx relating to the services to be performed
by it under this Agreement are the property of the Company and will be
preserved in accordance with Rule 31a-2 under the 1940 Act and will be
surrendered promptly to the Company upon request.
4. Complaints and Regulatory Actions. Xxxxx Xxxxxxx and the Company shall
cooperate fully in any securities regulatory investigation or proceeding or
judicial proceeding with respect to Xxxxx Xxxxxxx, the Company, their affiliates
(as defined in the 0000 Xxx) and/or their agents, representatives or employees
to the extent that such investigation or proceeding is in connection with the
services subject to this Agreement. Without limiting the foregoing, the parties
shall notify each other promptly of the receipt of notice of any such
investigation or proceeding and of any customer complaint relating to or learned
of in the course of the provision of services subject to this Agreement.
In the case of any such customer complaint, Xxxxx Xxxxxxx and the Company and
their affiliates shall cooperate in investigating such complaint. Any response
to a customer complaint relating to the Company must be approved in writing by
the Company prior to it being sent to the customer or any regulatory authority.
The Company agrees to review any such response to such substantive complaint
prepared by Xxxxx Xxxxxxx within three (3) business days of its receipt by the
Company, except that, if a more prompt response is required, the Company shall
review such response within the required shorter time period. Any response by
Xxxxx Xxxxxxx to a customer complaint which relates to Xxxxx Xxxxxxx or its
affiliates shall be provided to the Company no later than the time it is
provided to the customer or any regulatory authority.
5. Fund Shares Held on Behalf of Xxxxx Xxxxxxx Clients. Fund shares held by
Xxxxx Xxxxxxx on behalf of a client of Xxxxx Xxxxxxx shall be carried in a
custody account for the exclusive benefit of clients of Xxxxx Xxxxxxx and shall
not be subject to any right, charge, security interest, lien or other claim
against Xxxxx Xxxxxxx in favor of the Company or any Fund.
6. Indemnification.
(a) Xxxxx Xxxxxxx will not be responsible for, and the Company will hold
harmless and indemnify Xxxxx Xxxxxxx from and against, any loss by or
liability to the Company or a third party, including attorneys' fees,
in connection with any claim or suit asserting any such liability
arising out of or attributable to actions taken by Xxxxx Xxxxxxx
pursuant to this Agreement, unless Xxxxx Xxxxxxx has acted negligently
or in bad faith. Without limitation of the foregoing:
(i) at any time Xxxxx Xxxxxxx may apply to any officer of the Company
for instructions, and may consult with legal counsel for the
Company or its own legal counsel at the expense of the Company,
with respect to any matter arising in connection with its agency,
and Xxxxx Xxxxxxx will not be liable for any action taken or
omitted by it in good faith reliance upon such instructions or
upon the opinion of such counsel; and
(ii) Xxxxx Xxxxxxx may rely upon and 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 persons and will not
be held to have notice of any change of authority of any person
until receipt of written notice thereof from the Company.
(b) Xxxxx Xxxxxxx will hold harmless and indemnify the Company from and
against any loss or liability arising out of Xxxxx Xxxxxxx'x failure
to comply with the terms of this Agreement or arising out of Xxxxx
Xxxxxxx'x negligence, misconduct or bad faith.
7. Interpretation; Governing Law. This Agreement shall be subject to and
interpreted in accordance with all applicable provisions of law, including,
without limitation, the 1940 Act and the rules and regulations promulgated
thereunder. To the extent the provisions herein contained conflict with any such
applicable provisions of law, the latter shall control. The laws of the State of
Minnesota shall otherwise govern the construction, validity and effect of this
Agreement.
8. Effective Date; Duration; Termination.
(a) This Agreement shall be effective as of the date first set forth
above.
(b) Unless sooner terminated as hereinafter provided, this Agreement shall
continue in effect from year to year but only so long as such
continuance is specifically approved at least annually by the Board of
Directors of the Company, including a majority of the Directors who
are not parties to this Agreement or "interested persons" of any such
party (as defined in the 1940 Act), by vote cast in person at a
meeting called for the purpose of voting on such approval.
(c) This Agreement may be terminated at any time without the payment of
any penalty by either party upon not less than 60 days' written notice
to the other party. Upon the effective termination date, Xxxxx Xxxxxxx
shall make available to the Company or its designated record keeping
successor all of the records of the Company maintained under this
Agreement then in Xxxxx Xxxxxxx'x possession.
(d) This Agreement shall automatically terminate in the event of its
assignment (as defined by the provisions of the 0000 Xxx) unless such
assignment is approved in advance by the Board of Directors, including
a majority of the directors of the Company who are not parties to this
Agreement or "interested persons" of any such party (as defined in the
1940 Act).
9. Amendments. No material amendment to this Agreement shall be effective until
approved by Xxxxx Xxxxxxx and by a vote of the Board of Directors of the
Company, including a majority of the Directors who are not parties to this
Agreement or "interested persons" of any such party (as defined in the 1940
Act).
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be signed
by their duly authorized officers as of the day and year first above written.
ATTEST: PIPER FUNDS INC.--II
/s/ Xxxxx Xxxxxxxxx By /s/ Xxxxxx X. Xxxxxx
Its Senior Vice President
ATTEST: XXXXX XXXXXXX INC.
/s/ Xxxxx Xxxxxxxxx By /s/ Xxxxxxx X. Xxxxx
Its President
EXHIBIT A TO SHAREHOLDER ACCOUNT SERVICING AGREEMENT
SCHEDULE OF CHARGES
Fund Per Account Charge
Adjustable Rate Mortgage $7.50 per active account
Securities Fund $1.60 per closed account
An active account is defined as an account that has a balance of shares. A
closed account is defined as an account that does not have a balance of shares
but has had activity within the past 12 months.
