SHAREHOLDER SERVICES AGREEMENT
This Agreement, dated as of the 12th of September 1994, made by and between
The Xxxxxxx Funds, Inc. (the "Fund") a corporation operating as an open-end
management investment company, duly organized and existing under the laws of the
State of Maryland and Xxxxxxx Capital Management, Inc. (the "Company"), a
corporation duly organized and existing under the laws of the State of Maryland.
WITNESSETH THAT:
WHEREAS, the Fund consists of a series of Funds, at present namely: The
Xxxxxxx U.S. Treasury Money Fund; The Xxxxxxx Institutional Cash Management
Fund.
WHEREAS, the Fund desires to appoint the Company as its Transfer,
Redemption and Dividend Disbursing Agent as set forth in this Agreement and to
perform certain other functions in connection with these duties; and
WHEREAS, the Company is willing to perform such functions upon the terms
and conditions set forth below; and
WHEREAS, the Fund will cause to be provided certain information to the
Company as set forth below.
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein, the parties hereto, intending to be legally bound, do hereby
agree as follows:
Section 1. The terms as defined in this Section wherever used in this
Agreement, or in any amendment or supplement hereto, shall have the meanings
herein specified unless the context otherwise requires.
The Fund: The term Fund shall mean any series issued by the authority of
the Board of Directors.
Shareholders: The term Shareholders shall mean the registered owners from
time to time of the Shares of the Fund in accordance with the share registry
records of the Fund.
Shares: The term Shares shall mean the issued and outstanding shares of
the Fund.
Oral Instruction: The term Oral Instruction shall mean an authorization,
instruction, approval, item or set of data, or information of any kind
transmitted to the Company in person or by telephone, telegram, telecopy or
other mechanical or documentary means lacking original signature, by a person or
persons believed in good faith by the Company to be a person or persons
authorized by a resolution of the Board of Directors of the Fund, to give Oral
Instructions on behalf of the Fund.
Written Action: The term Written Instruction shall mean an authorization,
instruction, approval, item or set of data or information of any kind
transmitted to the Company in original writing containing original signatures or
a copy of such document transmitted by telecopy including transmission of such
signature believed in good faith by the Company to be the signature of a person
authorized by a resolution of the Board of Directors of the Fund to give Written
Instructions on behalf of the Fund.
TRANSFER AGENCY
Section 2. Company as Transfer Agent, shall make original issues of Shares
in accordance with Sections 9 and 10 below and with the Fund's Prospectus and
Statement of Additional Information upon the written request of the Fund and
upon being furnished with (i) a certified copy of a resolution or resolutions of
the Board of Directors of the Fund authorizing such issue; (ii) an opinion of
counsel as to the validity of such additional Shares; and (iii) necessary funds
for the payment of any original issue tax applicable to such additional Shares.
Section 3. Transfers of Shares shall be registered (i) in form deemed by
Company to be properly endorsed for transfer, (ii) with all necessary endorsers'
signatures guaranteed by a member firm of a national securities exchange or a
commercial bank, accompanied by (iii) such assurances as Company shall deem
necessary or appropriate to evidence the genuineness and effectiveness of each
necessary endorsement, and (iv) satisfactory evidence of compliance with all
applicable laws relating to the payment or collection of taxes.
Section 4. In registering transfers Company as Transfer Agent may rely
upon the Uniform Commercial Code or any other statutes which in the opinion of
counsel protect Company and the Fund in not requiring complete documentation, in
registering transfer without inquiry into adverse claims, in delaying
registration for purposes of such inquiry, or in refusing registration where in
its judgment an adverse claim requires such refusal.
Section 5. Company will maintain stock registry records in the usual form
in which it will note the issuance, transfer and redemption of Shares and is
also authorized to maintain an account entitled Unissued Certificate Account in
which it will record the Shares and fractions issued and outstanding from time
to time for which issuance of Share Certificates is deferred. The Fund is
responsible to provide Company reports of Fund Share purchases, redemptions and
total Shares outstanding on the next business day after each net asset
valuation. Company is authorized to keep records, which will be part
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of the stock transfer records, in which it will note the names and registered
address of Shareholders and the number of Shares and fractions from time to time
owned by them for which no Share Certificates are outstanding. Each Shareholder
will be assigned a single account number.
Section 6. The Fund authorizes Company to dispense with the issuance and
countersignature of Share Certificates whenever Shares are purchased. In such
case Company as Transfer Agent, shall merely note on its stock registry records
the issuance of the Shares and fractions (if any), shall credit the Unissued
Certificate Account with the Shares and fractions issued and shall credit the
proper number of Shares and fractions to the respective Shareholders. Likewise,
whenever Company has occasion to surrender for redemption Shares and fractions
owned by Shareholders, it shall be unnecessary to issue Share Certificates for
redemption purposes. The Fund authorizes Company in such cases to process the
transactions by appropriate entries in its share transfer records, and debiting
of the Unissued Certificate Account and the record of issued Shares outstanding.
Section 7. Company in its capacity as Transfer Agent will, in addition to
the duties and functions above-mentioned, perform the usual duties and functions
of a Stock Transfer Agent for a corporation. Company may rely conclusively and
act without further investigation upon any list, instruction, certification,
authorization, or other instrument or paper believed by it in good faith to be
genuine and unaltered, and to have been signed, countersigned, or executed by
duly authorized person or persons, or upon the instructions of any officer of
the Fund, or upon the advice of counsel for the Fund or for Company. The Fund
agrees to indemnify and hold harmless Company from and against any and all
losses, costs, claims, and liability which it may suffer or incur by reason of
so relying or acting or refusing to act.
Section 8. In case of any request or demand for the inspection of the
share records of the Fund, Company as Transfer Agent, shall endeavor to notify
the Fund and to secure instructions as to permitting or refusing such
inspection. However, Company may exhibit such records to any person in any case
where it is advised by its counsel that it may be held liable for failure to do
so.
ISSUANCE OF SHARES
Section 9. Prior to the daily determination of net asset value in
accordance with the Fund's Prospectus, Company shall process all purchase orders
received since the last determination of the Fund's net asset value.
Company shall calculate daily the amount available for investment in Shares
at the net asset value determined by the Company as pricing agent (see
Accounting Services Agreement) as of the close of trading on the New York Stock
Exchange, the number of Shares and fractional Shares to be purchased and the net
asset value to be deposited with the Custodian. Company as agent for the
Shareholders, shall place a purchase order daily
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with the Fund for the proper number of Shares and fractional Shares to be
purchased and confirm such number to the Fund in writing.
Section 10. Company having made the calculations provided for in Section
9, shall thereupon pay over the net asset value of shares purchased to the
Custodian. The proper number of Shares and fractional Shares shall then be
issued daily and credited by Company to the Unissued Certificate Account. The
Shares and fractional Shares purchased for each Shareholder will be credited by
Company to his separate Account. Company shall mail to each Shareholder a
confirmation of each purchase, with copies to the Fund if requested. Such
confirmations will show the prior Share balance, the new Share balance, the
amount invested and the price paid for the newly purchased Shares.
REDEMPTIONS
Section 11. Company shall, prior to the daily determination of net asset
value in accordance with the Fund's Prospectus and Statement of Additional
Information, process all requests from Shareholders to redeem Shares and
determine the number of Shares required to be redeemed to make monthly payments,
automatic payments or the like. Thereupon, Company shall advise the Fund of the
total number of Shares available for redemption and the number of Shares and
fractional Shares requested to be redeemed. Following determination of the
applicable net asset value, Company shall furnish the Fund with an appropriate
confirmation of the redemption and process the redemption by filing with the
Custodian an appropriate statement and making the proper distribution and
application of the redemption proceeds in accordance with the Fund's Prospectus
and Statement of Additional Information. The stock registry books recording
outstanding Shares, the Unissued Certificate Account and the individual account
of the Shareholder shall be properly debited.
Section 12. The proceeds of redemption shall be remitted by Company in
accordance with the Fund's Prospectus by check or wire to the Shareholder. The
Company shall require a signature guarantee of a commercial bank, trust company,
or a member firm of a national securities exchange pursuant to the Fund's
Prospectus. The Fund may authorize Company to waive the signature guarantee in
certain cases by Written Instructions.
For the purposes of redemption of Shares which have been purchased within
15 days of a redemption request, the Fund shall provide Company, from time to
time, with Written Instructions concerning the time within which such requests
may be honored.
DIVIDENDS
Section 13. The Fund declares dividends daily with payment to Shareholders
of record monthly. Upon the declaration of each capital gains distribution by
the Board of Directors of the Fund, the Fund shall notify Company of the date
such declaration, the
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amount payable per share, the record date for determining the Shareholders
entitled to payment, the payment and the reinvestment date price.
Section 14. On or before each payment date the Fund will transfer, or
cause the Custodian to transfer, to Company in its capacity as Dividend
Disbursing Agent, the total amount of the dividend or distribution currently
reinvest all dividends in additional shares except in cases where Shareholders
have elected to receive distribution in cash, in which case Company will mail
distribution checks to the Shareholders for the proper amounts payable to them.
GENERAL PROVISIONS
Attached hereto is a list of all inaccuracies, omissions, discrepancies,
and other deficiencies in the Materials known to the Fund. The Fund agrees to
promptly advise the Company in writing of all additions to or deletions from
said list necessary to maintain the list in current status. The Company shall
make reasonable efforts to isolate and correct any inaccuracies, omissions,
discrepancies, or other deficiencies in the Materials delivered to the Company,
to the extent such matters are disclosed to the Company or are discovered by it
and are relevant to its performance of its functions under this Agreement. The
Fund shall provide the Company with such assistance as it may reasonably request
in connection with its efforts to correct such matters. The Fund agrees to pay
the Company on a current and ongoing basis for its reasonable time and costs
expended on the correction of such matters, said payment to be in addition to
the fees and charges agreed to for the normal services rendered under this
Agreement.
The Company expressly makes no warranty or representation that any error,
omission or deficiency can be satisfactorily corrected. The Fund further agrees
that if the Company is subject to any claim, suit or other expense which, in the
Company's sole reasonable judgment is due to any inaccuracy, omission,
discrepancy or other deficiency of the Materials delivered to the Company
hereunder, or is due to failure to provide any record or material required
hereunder, the Fund shall pay the Company on a monthly basis for all costs in
connection therewith and indemnify and hold the Company harmless from and
against all costs in connection therewith, including all attorney fees and
costs, provided, however, that if such error, omission, inaccuracy or other
deficiency is caused directly or indirectly by gross negligence or reckless
disregard by the Company of its duties and responsibilities hereunder, the Fund
shall have no obligation to indemnify and hold harmless the Company, its
successors or assigns.
With respect to any matter involving a possible assertion of any past,
present or future potential or contingent liability of the Company as Transfer
Agent or Dividend Disbursing Agent, the Fund warrants that it has not committed
and shall not commit any act or omission that constitutes a waiver, release,
estoppel, or other impairment of any kind of any rights it may heretofore have
had, may now have, or may hereafter have against Fund/Plan Services, Inc. and
that it shall do everything necessary to preserve, and, if appropriate, enforce
all of such rights against Fund/Plan Services, Inc. Without
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limitation of the foregoing, the Fund agrees that if any suit is instituted
against the Company arising, in the Company's sole reasonable judgment, out of
any act or omission of Fund/Plan Services, Inc., which created a deficiency of
the Materials delivered hereunder, or out of any failure of Fund/Plan Services,
Inc. to deliver material, information or assistance contemplated hereunder, then
the Fund shall take whatever steps are necessary to join Fund/Plan Services,
Inc. as a party defendant or additional defendant in said litigation.
Section 15. Company shall maintain records (which may be part of the stock
transfer records) in connection with the issuance and redemption of Shares, and
the disbursement of dividends and dividend reinvestments, in which will be noted
the transactions effected for each Shareholder and the number of Shares and
fractional Shares owned by each for which no Share Certificates are outstanding.
Company agrees to make available upon request and to preserve for the periods
prescribed in Rule 31 a-2 under the Investment Company Act of 1940 any records
relating to services provided under this Agreement which are required to be
maintained by Rule 31 a-1 under the Act.
Section 16. In addition to the services as Transfer Agent and Dividend
Disbursing Agent as above set forth, Company will perform other services for the
fund as agreed from time to time, including but not limited to, preparation of
and mailing Federal Tax Information Forms, mailing semi-annual reports of the
Fund, preparation of one annual list of Shareholders, and mailing notices of
Shareholders' meetings, proxies and proxy statements.
Section 17. Nothing contained in this Agreement is intended to or shall
require Company in any capacity hereunder, to perform any functions or duties on
any holiday, day of special observance or any other day on which Custodian or
the New York Stock Exchange are closed. Functions or duties normally scheduled
to be performed on such days shall be performed on, and as of, the next business
day on which both the New York Stock Exchange and Custodian are open.
Section 18. The Fund agrees to pay Company compensation for its services
and to reimburse it for expenses, as set forth in Schedule A attached hereto, or
as shall be set forth in amendments to such Schedule approved by the Fund and
the Company. The invoices for the service will be sent to the Fund monthly with
payment to the Company within 15 days of the Fund's receipt of the invoice.
Section 19. (a) The Company, its directors, officers, employees,
shareholders and agents shall not be liable for any error of judgment or mistake
of law or for any loss suffered by the Fund in connection with the performance
of this Agreement, except a loss resulting from willful misfeasance, bad faith
or gross negligence on the part of the Company in the performance of its
obligations and duties under this Agreement.
(b) Any person, even though also a director, officer, employee,
shareholder or agent of the Company, who may be or become an officer, trustee,
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employee or agent of the Fund, shall be deemed, when rendering services to the
Fund or acting on any business of the Fund (other than services or business in
connection with the Company's duties hereunder), to be rendering such services
to or acting solely for the Fund and not as a director, officer, employee,
shareholder or agent of, or one under the control or direction of the Company
even though paid by it.
(c) Notwithstanding any other provision of this Agreement, the
Fund shall indemnify and hold harmless the Company, its directors, officers,
employees, shareholders and agents from and against any and all claims, demands,
expenses and liabilities (whether with or without basis in fact or law) of any
and every nature which the Company may sustain or incur or which may be asserted
against the Company by any person by reason of, or as a result of: (i) any
action taken or omitted to by taken by the Company in good faith hereunder, (ii)
in reliance upon any certificate; instrument, order or stock certificate or
other document reasonably believed by it to be genuine and to be signed,
countersigned or executed by any duly authorized person, upon the Oral
Instructions or Written Instructions of an authorized person of the Fund or upon
the opinion of legal counsel for the Fund or its own counsel; or (iii) any
action taken or omitted to be taken by the Company in connection with its
appointment in good faith in reliance upon any law, act, regulation or
interpretation of the same even though the same may thereafter have been
altered, changed, amended or repealed. However, indemnification under this
subparagraph shall not apply to actions or omissions of the Company or its
directors, officers, employees, shareholders or agents in cases of its or their
own negligence, willful misconduct, bad faith, or reckless disregard of its or
their own duties hereunder.
(d) The Company shall give written notice to the Fund within ten
(10) business days of receipt by the Company of a written assertion or claim of
any threatened or pending legal proceeding which may be subject to this
indemnification. However, the failure to notify the Fund of such written
assertion or claim shall not operate in any manner whatsoever to relieve the
Fund of any liability arising from this Section or otherwise except to the
extent that the failure to give notice prejudices the Fund's defense.
(e) For any legal proceeding giving rise to this indemnification,
the Fund shall be entitled to defend or prosecute any claim in the name of the
company at its own expense and through counsel of its own choosing if it gives
written notice to the Company within ten (10) business days of receiving notice
of such claim. Notwithstanding the foregoing, the Company may participate in
the litigation at its own expense through counsel of its own choosing. If the
Fund does choose to defend or prosecute such claim, then the parties shall
cooperate in the defense or prosecution thereof and shall furnish such records
and other information as are reasonably necessary.
(f) The Fund shall not settle any claim without the Company's
express written consent which shall not be unreasonably withheld. The Company
shall
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not settle any claim without the Fund's express written consent which shall not
be unreasonably withheld.
Section 20. Company is authorized, upon receipt of Written Instructions
from the Fund, to make payment upon redemption of Shares without a signature
guarantee. The Fund hereby agrees to indemnify and hold Company, its successors
and assigns, harmless of and from any and all expenses, damages, claims, suits,
liabilities, actions, demands, losses whatsoever arising out of or in connection
with a payment by Company upon redemption of Shares without a signature
guarantee in reliance on Written Instructions from the Fund and upon the request
of Company the Fund shall assume the entire defense of any action, suit or claim
subject to the foregoing indemnity. Company shall notify the Fund of any such
action, suit or claim within 30 days after receipt by Company of notice thereof.
Section 21. (a) The term of this Agreement shall be for a period of two
(2) years, commencing on the date hereof and shall continue in force from year
to year thereafter, but only so long as such continuance is approved (1) by the
Company, (2) by vote, cast in person at a meeting called for the purpose, of a
majority of the Fund's Directors who are not parties to this Agreement or
interested persons (as defined in the Act) of any such party, and (3) by vote of
a majority of the Fund's Board of Directors or a majority of the Fund's
outstanding voting securities unless notice of termination has been given as
provided in paragraph (c) below.
(b) The fee schedule will be fixed for a one (1) year period from
the date of the agreement. After the one (1) year period, the fee will be
subject to annual review.
(c) The Fund or the company may give written notice to the other
of the termination of this Agreement, such termination to take effect at the
time specified in the notice, not less than 30 days after the giving of the
notice. Upon the effective termination date, the Fund shall pay to the Company
such compensation as may be due as of the date of termination and shall likewise
reimburse the Company for any out-of pocket expenses and disbursements
reasonably incurred by the Company to such date.
(d) In the event that in connection with termination of this
Agreement a successor to any of the Company's duties or responsibilities under
this Agreement is designated by the Fund by written notice to the company, the
Company shall, promptly upon such termination and at the expense of the Fund,
transfer all required Records and shall cooperate in the transfer of such duties
and responsibilities.
(e) The Fund acknowledges that in order for the Company to perform
the services contemplated hereunder, Company has made and will make significant
investments of time and money. If this Agreement is terminated for reasons
other than a material breach by the Company prior to the expiration of the
initial term of this contract,
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the Fund will pay to Company 20% of the minimum fees remaining for the unexpired
term of the Agreement.
Section 22. The Fund shall file with Company a certified copy of each
resolution of its Board of Directors authorizing the execution of Written
Instructions or the transmittal of Oral Instructions, as provided in Section I
of this Agreement.
Section 23. This Agreement may be amended from time to time by a
supplemental agreement executed by the Fund and the company.
Section 24. Any notice or other communication required by or permitted to
be given in connection with this Agreement shall be in writing, and shall be
delivered in person or sent by first class mail, postage prepaid, to the
respective party as follows:
The Xxxxxxx Funds, Inc.
World Trade Center - Baltimore
000 Xxxx Xxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxx, Xx., President
Section 25. The Fund represents and warrants to Company that the execution
and delivery of this Shareholder Services Agreement by the undersigned officers
of the Fund has been duly and validly authorized by resolution of the Board of
Directors of the Fund.
Section 26. This Agreement may be executed in two or more counterparts,
each of which when so executed shall be deemed to be an original, but such
counterparts shall together constitute but one and the same instrument.
Section 27. This Agreement shall extend to and shall be binding upon the
parties hereto and their respective successors and assigns; provided, however,
that this Agreement shall not be assignable by the Fund without the written
consent of Company or by Company without the written consent of the Fund,
authorized or approved by a resolution of its Board of Directors.
Section 28. This Agreement shall be governed by the laws of Maryland.
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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.
THE XXXXXXX FUNDS, INC.
By: /S/ XXXXXX X. XXXXXXX, XX.
--------------------------
Attest: /S/ XXXXXXX XXXXXXXXXX Title: Chairman
---------------------- ------------------------
XXXXXXX CAPITAL
MANAGEMENT, INC.
By: /S/ XXXXXX X. XXXXXXX, XX.
--------------------------
Attest: /S/ XXXXXXX XXXXXXXXXX Title: Chairman
---------------------- -----------------------
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SCHEDULE A
FEE SCHEDULE
THE XXXXXXX U.S TREASURY MONEY FUND
THE XXXXXXX INSTITUTIONAL CASH MANAGEMENT FUND
(All fees are quoted for a period of 90 days and will be for a term of one (1)
year from date of conversion.)
SHAREHOLDER SERVICES AND TRANSFER AGENT
The following is our schedule for Shareholder Services and Transfer Agent
Services:
Monthly Fee $1,500/Portfolio
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