TRANSFER AGENCY AND SERVICE AGREEMENT
AGREEMENT made as of this 1st day of October, 1999, between LSA VARIABLE
SERIES TRUST, a business trust organized and registered under the laws of the
state of Delaware (the "Trust"), and INVESTORS BANK & TRUST COMPANY, a
Massachusetts trust company (the "Bank").
WHEREAS, the Trust desires to appoint the Bank as its transfer agent,
dividend disbursing agent and agent in connection with certain other activities,
and the Bank desires to accept such appointment;
WHEREAS, the Bank is duly registered as a transfer agent as provided in
Section 17A(c) of the Securities Exchange Act of 1934, as amended, (the "1934
Act");
WHEREAS, the Trust is authorized to issue shares in separate series, with
each such series representing interests in a separate portfolio of securities
and other assets;
WHEREAS, the Trust intends to initially offer shares in the series listed
on APPENDIX A hereto (such series, together with all other series subsequently
established by the Trust and made subject to this Agreement in accordance with
Section 17, being herein referred to as the "Fund(s)");
NOW, THEREFORE, in consideration of the mutual covenants herein set forth,
the Trust and the Bank agree as follows:
1. TERMS OF APPOINTMENT DUTIES OF THE BANK.
1.1 Subject to the terms and conditions set forth in this Agreement, the
Trust on behalf of the Funds hereby employs and appoints the Bank to act, and
the Bank agrees to act, as transfer agent for each of the Fund(s)' authorized
and issued shares of beneficial interest ("Shares") and dividend disbursing
agent.
1.2 The Bank agrees that it will perform the following services:
(a) In connection with procedures established from time to time by
agreement between the Trust and the Bank, the Bank shall:
(i) Receive for acceptance orders for the purchase of Shares and
promptly deliver payment and appropriate documentation therefor to the custodian
of the Trust appointed by the Board of Trustees of the Trust (the "Custodian");
(ii) Pursuant to purchase orders, issue the appropriate number of
Shares and hold such Shares in the appropriate account of the Trust's
shareholders ("Shareholders");
(iii) Receive for acceptance redemption requests and redemption
directions and deliver the appropriate documentation therefor to the Custodian;
(iv) 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;
(v) Prepare and transmit payments for dividends and distributions
declared by the Trust on behalf of a Fund;
(vi) Create and maintain all necessary records including those
specified in Section 10 hereof, in accordance with all applicable laws, rules
and regulations, including but not limited to records required by Section 31(a)
of the Investment Company Act of 1940, as amended (the "1940 Act"), and those
records pertaining to the various functions performed by it hereunder. All
records shall be available for inspection and use by the Trust. Where
applicable, such records shall be maintained by the Bank for the periods and in
the places required by Rule 3la-2 under the 1940 Act;
(vii) Make available during regular business hours all records and
other data created and maintained pursuant to this Agreement for reasonable
audit and inspection by the Trust, or any person retained by the Trust. Upon
reasonable notice by the Trust, the Bank shall make available during regular
business hours its facilities and premises employed in connection with its
performance of this Agreement for reasonable visitation by the Trust, or any
person retained by the Trust; and
(viii) Record the issuance of Shares of the Trust and maintain,
pursuant to Rule 1 7Ad- 10(e) under the 1934 Act, a record of the total number
of Shares of the Trust which are authorized, based upon data provided to it by
the Trust, and issued and outstanding. The Bank shall also provide the Trust on
a regular basis with the total number of Shares which are authorized and 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 Trust.
(b) In addition to and not in lieu of the services set forth in the
above paragraph (a) or in any Schedule hereto, the Bank shall perform all of the
customary services of a transfer agent and dividend disbursing agent; including
but not limited to maintaining all Shareholder accounts, preparing Shareholder
meeting lists, mailing proxies, receiving and tabulating proxies, mailing
Shareholder reports and prospectuses to current Shareholders, 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
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. The
Trust shall and hereby does indemnify to the Bank in writing that all
transactions and assets covered hereunder are to be treated as exempt from blue
sky reporting.
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(c) Additionally, 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
Fund(s) of such transactions so identified on a daily and cumulative basis.
2. SALE OF TRUST SHARES
2.1 Whenever the Trust shall sell or cause to be sold any Shares of a Fund,
the Trust shall deliver or cause to be delivered by facsimile to the Bank a
document duly specifying: (i) the name of the Fund whose Shares were sold; (ii)
the number of Shares sold, trade date, and price; (iii) the amount of money to
be delivered to the Custodian for the sale of such Shares and specifically
allocated to such Fund; and (iv) in the case of a new account, a new account
application or sufficient information to establish an account.
2.2 The Bank will, upon receipt by it of a check or other payment
identified by it as an investment in Shares of one of the Funds and drawn or
endorsed to the Bank as agent for, or identified as being for the account of;
one of the Funds, promptly deposit such check or other payment to the
appropriate account postings necessary to reflect the investment. The Bank will
notify the Trust, or its designee, and the Custodian of all purchases and
related account adjustments.
2.3 Under procedures as established by mutual agreement between the Trust
and the Bank, the Bank shall issue to the purchaser or its authorized agent such
Shares, computed to the nearest three decimal points, as he is entitled to
receive, based on the appropriate net asset value of the Funds' Shares,
determined in accordance with the prospectus and any applicable federal law or
regulation. In issuing Shares to a purchaser or its authorized agent, the Bank
shall be entitled to rely upon the latest directions, if any, previously
received by the Bank from the purchaser or its authorized agent concerning the
delivery of such Shares.
2.4 The Bank shall not be required to issue any Shares of the Trust where
it has received a written instruction from the Trust or written notification
from any appropriate federal or state authority that the sale of the Shares of
the Fund(s) in question has been suspended or discontinued, and the Bank shall
be entitled to rely upon such written instructions or written notification.
2.5 Upon the issuance of any Shares of any Fund(s) in accordance with
foregoing provisions of this Section, the Bank shall not be responsible for the
payment of any original issue or other taxes, if any, required to be paid by the
Trust in connection with such issuance.
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2.6 The Bank may establish such additional rules and regulations governing
the transfer or registration of Shares as it may deem advisable and consistent
with such rules and regulations generally adopted by transfer agents, or with
the written consent of the Trust, any other rules and regulations.
3. REDEMPTIONS. Shares of any Fund may be redeemed in accordance with the
procedures set forth in the Prospectus of the Trust and the Bank will duly
process all redemption requests.
4. [RESERVED]
5. RIGHT TO SEEK ASSURANCES. The Bank 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 shall incur no liability for the refusal, in good
faith, to make transfers or redemptions which the Bank, in its judgment, deems
improper or unauthorized, or until it is satisfied that there is no basis for
any claims adverse to such transfer or redemption. The Bank may, in effecting
transfers, rely upon the provisions of the Uniform Act for the Simplification of
Fiduciary Security Transfers or the Uniform Commercial Code, as the same may be
amended from time to time, which in the opinion of legal counsel for the Trust
or the Bank's own legal counsel, do not require certain documents in connection
with the transfer or redemption of Shares of any Fund, and the Trust shall
indemnify the Bank for any act done or omitted by it in reliance upon such laws
or opinions of counsel of the Trust or of the Bank.
6. DISTRIBUTIONS.
6.1 The Trust will promptly notify the Bank of the declaration of any
dividend or distribution. The Trust shall furnish to the Bank a resolution of
the Board of Trustees of the Trust certified by the Secretary (a "Certificate"):
(i) authorizing the declaration of dividends on a specified periodic basis and
authorizing the Bank to rely on oral instructions or a Certificate specifying
the date of the declaration of such dividend or distribution, the date of
payment thereof; the record date as of which Shareholders entitled to payment
shall be determined and the amount payable per share to Shareholders of record
as of such record date and the total amount payable to the Bank on the payment
date; or (ii) setting forth the date of the declaration of any dividend or
distribution by a Fund, the date of payment thereof; the record date as of which
Shareholders entitled to payment shall be determined, and the amount payable per
share to the Shareholders of record as of that date and the total amount payable
to the Bank on the payment date.
6.2 The Bank will maintain all records necessary to reflect the crediting
of dividends which are reinvested in Shares of the Trust, including without
limitation daily dividends.
6.3 The Bank shall not be liable for any improper payments made in
accordance with a resolution of the Board of Trustees of the Trust.
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7. OTHER DUTIES. In addition to the duties expressly provided for herein, the
Bank shall perform such other duties and functions and shall be paid such
amounts therefor as may from time to time be agreed to in writing.
8. TAXES. It is understood that the Bank shall file such appropriate information
returns concerning the payment of dividends and capital gain distributions and
tax withholding with the proper Federal, State and local authorities as are
required by law to be filed by the Trust and shall withhold such sums as are
required to be withheld by applicable law.
9. BOOKS AND RECORDS.
9.1 The Bank shall maintain confidential records showing for each
Shareholder's account the following: (i) names, addresses and tax identification
numbers; (ii) numbers of Shares held; (iii) historical information (as available
from prior transfer agents) regarding the account of each Shareholder, including
dividends paid and date and price of all transactions on a Shareholder's
account; (iv) any stop or restraining order placed against a Shareholder's
account; (v) information with respect to withholdings; (vi) any capital gain or
dividend reinvestment order, plan application, dividend address and
correspondence relating to the current maintenance of a Shareholder's account;
(vii) certificate numbers and denominations for any Shareholders holding
certificates; (viii) any information required in order for the Bank to perform
the calculations contemplated or required by this Agreement; and (ix) such other
information and data as may be required by applicable law.
9.2 Any records required to be maintained by Rule 3la-l under the 1940 Act
will be preserved for the periods prescribed in Rule 3la-2 under the 1940 Act.
Such records may be inspected by the Trust during regular business hours upon
reasonable notice. The Bank may, at its option at any time, and shall forthwith
upon the Trust's demand, turn over to the Trust and cease to retain in the
Bank's files, records and documents created and maintained by the Bank in
performance of its service or for its protection. At the end of the six-year
retention period, such documents will either be turned over to the Trust, or
destroyed in accordance with the Trust's authorization.
9.3 Procedures applicable to the services to be performed hereunder may be
established from time to time by agreement between the Fund(s) and the Bank. The
Bank shall have the right to utilize any shareholder accounting and
recordkeeping systems which, in its opinion, qualifies to perform any services
to be performed hereunder. The Bank shall keep records relating to the services
performed hereunder, in the form and manner as it may deem advisable.
10. FEES AND EXPENSES.
10.1 For performance by the Bank pursuant to this Agreement, the Fund(s)
agree to pay the Bank an annual maintenance fee for each Shareholder account as
set out in the initial fee schedule attached as APPENDIX B hereto. Such fees and
out-of-pocket expenses and advances identified under Section 10.2 below may be
changed from time to time subject to mutual written agreement between the
Fund(s) and the Bank.
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10.2 In addition to the fee paid under Section 10.1 above, the Fund(s)
agree to reimburse the Bank for out-of-pocket expenses or advances incurred by
the Bank for the items set out in the fee schedule attached hereto. In addition,
any other expenses incurred by the Bank at the request or with the consent of
the Fund(s) including, without limitation, any equipment or supplies which the
Trust specifically orders or requires the Bank to purchase, will be reimbursed
by the Fund(s).
10.3 The Fund(s) agree to pay all fees and reimbursable expenses within
thirty days following the mailing of the respective billing notice. Postage for
mailing of dividends, proxies, Fund reports and other mailings to all
shareholder accounts shall be advanced to the Bank by the Fund(s) at least seven
(7) days prior to the mailing date of such materials. Any waiver or extension by
the Bank of the thirty and seven day time periods enumerated in this Section
10.3 shall not constitute a dismissal of any monies due under this Agreement nor
shall such waiver or extension apply to any future monies due to the Bank
hereunder.
11. REPRESENTATIONS AND WARRANTIES OF THE BANK.
The Bank represents and warrants to the Trust that:
11.1 It is a trust company duly organized and existing and in good standing
under the laws of the Commonwealth of Massachusetts.
11.2 It is empowered under applicable laws and by its charter and by-laws
to enter into and perform this Agreement.
11.3 All requisite corporate proceedings have been taken to authorize it to
enter into and perform this Agreement.
11.4 It has and will continue to have access to the necessary facilities,
equipment and personnel to perform its duties and obligations under this
Agreement.
12. REPRESENTATIONS AND WARRANTIES OF THE TRUST.
The Trust represents and warrants to the Bank that:
12.1 It is a business trust duly organized and existing and in good
standing under the laws of the State of Delaware as set forth in the preamble
hereto.
12.2 It is empowered under applicable laws and by its charter documents and
by-laws to enter into and perform this Agreement.
12.3 All proceedings required by said charter documents and by-laws have
been taken to authorize it to enter into and perform this Agreement.
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12.4 It is an open-end investment company registered under the 1940 Act.
12.5 A registration statement on Form N-lA (including a prospectus and
statement of additional information) under the Securities Act of 1933 and the
1940 Act is currently effective and will remain effective, and appropriate state
securities law filings have been made and will continue to be made, with respect
to all Shares of the Trust being offered for sale.
12.6 When Shares are hereafter issued in accordance with the terms of the
Prospectus, such Shares shall be validly issued, fully paid and nonassessable by
the Fund(s).
13. INDEMNIFICATION.
13.1 Notwithstanding anything in this Agreement to the contrary, in no
event shall the Bank or any of its officers, directors, employees or agents
(collectively, the "Indemnified Parties") be liable to the Trust, any Fund or
any third party, and the Trust and each Fund shall indemnify and hold the Bank
and the Indemnified Parties harmless from and against any and all loss, damage,
liability, actions, suits, claims, costs and expenses, including legal fees (a
"Claim"), arising as a result of any act or omission of the Bank or any
Indemnified Party under this Agreement, except for any Claim resulting solely
from the negligence, willful misfeasance or bad faith of the Bank or any
Indemnified Party. Without limiting the foregoing, neither the Bank nor the
Indemnified Parties shall be liable for, and the Bank and the Indemnified
Parties shall be indemnified against, any Claim arising as a result of:
(a) Any actions taken or omitted to be taken by the Bank or its agents
or subcontractors in good faith in reliance on, or use by the Bank or its agents
or subcontractors of; information, records and documents which (i) are received
by the Bank or its agents or subcontractors and furnished to such party by or on
behalf of the Fund(s), (ii) have been prepared and/or maintained by the Fund(s)
or any other person or firm on behalf of the Fund(s), or (iii) were received by
the Bank or its agents or subcontractors from a prior transfer agent.
(b) Any action taken or omitted to be taken by the Bank in good faith
reliance upon any law, act, regulation (a "Regulation") or interpretation of a
Regulation even though such Regulation may thereafter have been altered,
changed, amended or repealed.
(c) The Fund(s)' refusal or failure to comply with the terms of this
Agreement, or which arise out of the Funds' lack of good faith, negligence or
willful misconduct or which arise out of the breach of any representation or
warranty of the Fund(s) hereunder.
(d) The Bank's good faith and reasonable reliance on, or the carrying
out by the Bank or its agents or subcontractors of any instructions or requests,
whether written or oral, of the Fund(s).
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(e) The offer or sale of Shares by the Trust in violation of (i) any
requirement under the federal securities laws or regulations; (ii) any
requirement under the securities laws or regulations of any state; or (iii) any
stop order or other determination or ruling by any federal or state agency with
respect to the offer or sale of such Shares.
13.2 The Bank shall indemnify and hold the Fund(s) harmless from and
against any and all losses, damages, costs, charges, legal fees, payments,
expenses and liability arising out of or attributed to any action or failure or
omission to act by the Bank as a result of the Bank's lack of good faith,
negligence, willful misconduct, knowing violation of law or fraud.
13.3 At any time the Bank may apply to any officer of the Trust for
instructions, and may, after consultation with the Trust, consult with legal
counsel of the Bank or the Trust 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 Trust for any action taken or omitted by it in reliance upon
such instructions or upon the opinion of such counsel except for a knowing
violation of law. 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 Fund(s), 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 to the Bank or its agents or subcontractors by machine
readable input, telex, CRT data entry or other similar means authorized by the
Fund(s), and the Bank, its agents and subcontractors shall not be held to have
notice of any change of authority of any person, until receipt of written notice
thereof from the Fund(s). 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 an officer of the
Trust, and one proper countersignature of any former transfer agent or
registrar, or of a co-transfer agent or co-registrar.
13.4 In the event either party is unable to perform its obligations under
the terms of this Agreement because of acts of God, strikes, interruption of
electrical power or other utilities, equipment or transmission failure or damage
reasonably beyond its control, or other causes reasonably beyond its control,
such party shall not be liable to the other for compensation nor for any damages
resulting from such failure to perform or otherwise from such causes.
13.5 Neither party to this Agreement shall be liable to the other party for
special, incidental or consequential damages, even if the other party has been
advised of the possibility of such damages, under any provision of this
Agreement or for any act or failure to act hereunder as contemplated by this
Agreement.
13.6 In order that the indemnification provisions contained in this Section
13 shall apply, upon the assertion of a claim for which either party may be
required to indemnify the other, the party seeking the 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
seeking indemnification shall give the indemnifying party full and complete
authority, information and assistance to defend such claim or proceeding, and
the indemnifying party shall have, at its option, sole control of the defense of
such claim or proceeding and all negotiations for its compromise or settlement.
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, which consent shall not be
unreasonably withheld.
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14. Covenants of the Trust and the Bank.
14.1 The Trust shall promptly furnish to the Bank the following:
(a) A certified copy of the resolution of the Trustees of the Trust
authorizing the appointment of the Bank and the execution and delivery of this
Agreement.
(b) A copy of the charter documents and by-laws of the Trust and all
amendments thereto.
(c) Copies of each vote of the Trustees designating authorized persons
to give instructions to the Bank, and a Certificate providing specimen
signatures for such authorized persons.
(d) Certificates as to any change in any officer or Director of the
Trust.
(e) If applicable a specimen of the certificate of Shares in each Fund
of the Trust in the form approved by the Trustees, with a Certificate as to such
approval.
(f) Specimens of all new certificates for Shares, accompanied by the
Trustees' resolutions approving such forms.
(g) All account application forms and other documents relating to
shareholder accounts or relating to any plan, program or service offered by the
Trust.
(h) A list of all Shareholders of the Fund(s) with the name, address and
tax identification number of each Shareholder, and the number of Shares of the
Fund(s) held by each, certificate numbers and denominations (if any certificates
have been issued), lists of any account against which stops have been placed,
together with the reasons for said stops, and the number of Shares redeemed by
the Fund(s).
(i) An opinion of counsel for the Trust with respect to the validity of
the Shares and the status of such Shares under the Securities Act of 1933.
(j) Copies of the Fund(s) registration statement on Form N-lA (if
applicable)as amended and declared effective by the Securities and Exchange
Commission and all post-effective amendments thereto.
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(k) Such other certificates, documents or opinions as the Bank may deem
necessary or appropriate for the Bank in the proper performance of its duties
hereunder.
14.2 The Bank hereby agrees to establish and maintain facilities and
procedures reasonably acceptable to the Trust 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.
14.3 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 1940 Act 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 are the confidential property of
the Trust and will be preserved, maintained and made available in accordance
with such Section and Rules, and will be surrendered to the Trust on and in
accordance with its request.
14.4 The Bank and the Trust 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.
14.5 In case of any requests or demands for the inspection of the
Shareholder records of the Trust, the Bank will endeavor to notify the Trust and
to secure instructions from an authorized officer of the Trust as to such
request or demand. 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 subject to enforcement or other action by any court or regulatory body
for the failure to exhibit the Shareholder records to such person.
15. TERM OF AGREEMENT.
15.1 Termination of Agreement. The term of this Agreement shall be three
years commencing upon the date hereof (the "Initial Term"), unless earlier
terminated as provided herein. After the expiration of the Initial Term, the
term of this Agreement shall automatically renew for successive one-year terms
(each a "Renewal Term") unless notice of non-renewal is delivered by the
non-renewing party to the other party no later than ninety days prior to the
expiration of the Initial Term or any Renewal Term, as the case may be.
(a) Either party hereto may terminate this Agreement prior to the
expiration of the Initial Term in the event the other party violates any
material provision of this Agreement, provided that the non-violating party
gives written notice of such violation to the violating party and the violating
party does not cure such violation within forty-five (45) days of receipt of
such notice.
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(b) If, during the Initial Term of this Agreement, a state or Federal
statutory or regulatory change shall occur such that the sale of variable
products by insurance companies generally is no longer feasible (and such change
is evidenced by changes in the sales practices for variable products across the
insurance industry) and as a result, the Board of Trustees of the Fund votes to
liquidate the Fund and terminate its registration with the Securities and
Exchange Commission, written notice (the "Liquidation Notice") of such
determination setting forth the reasons for such determination shall be provided
to the Bank. In order to be effective, any Liquidation Notice must be executed
by two officers of the Fund. The Bank shall, within seven days of receipt of
such a Liquidation Notice, reply to the Fund as to whether it agrees that the
terms of the Liquidation Notice meet the requirements of this paragraph, which
agreement shall not be unreasonably withheld. Upon such agreement, the Fund may
terminate this Agreement without additional action by the Fund's Board upon an
additional sixty (60) days written notice.
Should this Agreement be terminated in accordance with the terms of this
paragraph, the Fund shall pay to the Bank, in lieu of the fees for which the
Fund would otherwise be liable to the Bank hereunder through the end of the
Initial Term, the following amounts:
i. If during the first year of the Initial Term the Fund shall pay to the
Bank an amount equal to the fees that would otherwise be due under
this Agreement through the last day of the eighteenth month of the
Initial Term, WITHOUT giving effect to the discount provided on the
first years' fees set forth in Appendix B;
ii. If during the second year of the Initial Term the Fund shall pay to
the Bank an amount equal to the fees that would otherwise be due under
this Agreement through the last day of the second year of the Initial
Term;
iii. If during the third year of the Initial Term the Fund shall pay to the
Bank an amount equal to the fees that would otherwise be due under
this Agreement through the end of the Initial Term.
(c) Either party may terminate this Agreement during any Renewal Term
upon ninety days written notice to the other party. Any termination pursuant to
this paragraph 16.1(b) shall be effective upon expiration of such ninety days,
provided, however, that the effective date of such termination may be postponed
to a date not more than one hundred twenty days after delivery of the written
notice: (i) at the request of the Bank, in order to prepare for the transfer by
the Bank of its duties hereunder; or (ii) at the request of the Fund, in order
to give the Fund an opportunity to make suitable arrangements for a successor
transfer agent.
15.2 Should the Trust exercise its right to terminate, all out-of-pocket
expenses associated with the movement of records and material will be borne by
the Trust. Additionally, the Bank reserves the right to recover from the Trust
any other reasonable expenses associated with such termination.
16. Additional Funds. In the event that the Trust establishes one or more series
of Shares in addition to the series listed on APPENDIX A hereto 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 if the Bank agrees to
provide such services, the parties may execute an amendment hereto pursuant to
which such series of Shares shall become a Fund hereunder and APPENDIX A shall
be appropriately amended.
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17. ASSIGNMENT AND SUBCONTRACTING.
17.1 Except as provided in Section 18.3 below, neither this Agreement nor
any rights or obligations hereunder may be assigned by either party without the
written consent of the other party.
17.2 This Agreement shall inure to the benefit of and be binding upon the
parties and their respective permitted successors and assigns.
17.3 The Bank, may [with the consent on the part of the Trust, ]subcontract
for the performance of any of the services to be provided hereunder to third
parties, including any affiliate of the Bank, provided that the Bank shall
remain liable hereunder for any acts or omissions of any subcontractor as if
performed by the Bank.
18. AMENDMENT. This Agreement may be amended or modified only by a written
agreement executed by both parties.
19. GOVERNING LAW. This Agreement shall be construed and the provisions thereof
interpreted under and in accordance with the laws of the Commonwealth of
Massachusetts, without regard to its conflict of laws provisions.
20. MERGER OF AGREEMENT AND SEVERABILITY
20.1 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.
20.2 In the event any provision of this Agreement shall be held
unenforceable or invalid for any reason, the remainder of the Agreement shall
remain in full force and effect.
20.3 This Agreement may be executed in any number of counterparts, each of
which shall be deemed to be an original; but such counterparts shall together,
constitute only one instrument.
21. NOTICES. Any notice or other instrument in writing authorized or required by
this Agreement to be given to either party hereto will be sufficiently given if
addressed to such party and mailed or delivered to it at its office at the
address set forth below:
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For the Trust:
LSA Variable Series Trust
Allstate Life Insurance Company
0000 Xxxxxxx Xxxx, Xxxxx X0X
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxxx Xxxxxxx, Vice President, Chief Operations Officer
With a copy to: Xxxxxxx X. Xxxxxxx, Secretary, Chief Compliance
Officer
For the Bank:
Investors Bank & Trust Company
000 Xxxxxxxxx Xxxxxx, X.X. Xxx 0000
Xxxxxx, Xxxxxxxxxxxxx 00000-0000
Attention: Xxxxxx X. Xxxxxx, Director, Client Management
With a copy to: Xxxx X. Xxxxx, General Counsel
[Remainder of Page Intentionally Left Blank]
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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 the year first above written.
LSA VARIABLE SERIES TRUST
By: /s/ Xxxx X. Xxxxxx
------------------
Name: Xxxx X. Xxxxxx
Title: President
INVESTORS BANK & TRUST COMPANY
By: /s/ Xxxxxx X. Xxxxxxx
---------------------
Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice President
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APPENDIX A
LSA Variable Series Trust
Fund List
IBT
Account Fund Adviser
------ ---- -------
255 Focused Equity Xxxxxx Xxxxxxx Asset Management
260 Growth Equity Xxxxxxx Sachs Asset Management
265 Disciplined Equity XX Xxxxxx Investment Management Inc.
270 Value Equity Salomon Brothees Asset Management Inc.
275 Balanced OpCap Advisors
280 Emerging Growth
Domestic Equity RS Investment Management, L.P.
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APPENDIX B
LSA VARIABLE SERIES TRUST
Proposed Fee Schedule*
For 6 Mutual Funds
DOMESTIC CUSTODY, FUND ACCOUNTING,
CALCULATION OF N.A.V.,
ADMINISTRATION AND TRANSFER AGENCY
A. DOMESTIC CUSTODY, FUND ACCOUNTING, CALCULATION OF N.A.V., ADMINISTRATION AND
TRANSFER AGENCY
The following fees will apply to all assets for which Investors Bank
provides Custody, Fund Accounting, calculation of N.A.V., Administration and
Transfer Agency services.
Annual Fee
----------
FIRST $500 MILLION OF NET ASSETS 11.0 Basis Points
NEXT $500 MILLION OF NET ASSETS 9.0 Basis Points
NEXT $500 MILLION OF NET ASSETS 6.0 Basis Points
Assets in excess of $1.5 Billion 4.0 Basis Points
There will be an annual minimum fee of $140,000 per fund. However, to
accommodate the start-up period, first year minimums will be as follows: 1st
Quarter 50%, 2nd Quarter 75%, 3rd Quarter 85%, 4th Quarter and beyond 100%.
B. DOMESTIC TRANSACTIONS
DTC/Fed Book Entry $10**
Physical Securities 35
Options and Futures 18
GNMA Securities 30
Principal Paydown 5
Foreign Currency 18***
Outgoing Wires 7
Incoming Wires 5
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**This assumes that the trade information will be sent to Investors Bank in the
ISITC/SWIFT format. Manual trades will be billed at $12.00 per trade. There are
no transaction charges for use of the Investors Bank Repo.
***There are no transaction charges for F/X contracts executed by Investors
Bank.
C. FOREIGN SUBCUSTODIAN FEES
o Incremental basis point and transaction fees will be charged for all
foreign assets for which we are custodian. The asset based fees and
transaction fees vary by country, based upon the attached global
custody fee schedule. Local duties, script fees, registration,
reclaims, exchange fees, and other market charges are additional
out-of-pocket fees.
o Investors Bank will require the fund to hold all international assets
at the subcustodian of our choice.
MISCELLANEOUS
A. Out-of-Pocket
o These charges consist of:
-Legal Expenses -InvestView
-Printing, Delivery & Postage -Forms and Supplies
-Third Party Review -Micro Rental
-Extraordinary Travel Expenses
-Customized Systems Development/Reporting
-International Verification Services($3/security/month)
-Pricing and Verification Services
-Telecommunications
-Support Equipment Rental
-Data Transmissions
-Non Standard Extract
B. DOMESTIC BALANCE CREDIT
o We allow use of balance credit against fees (excluding out-of-pocket
charges) for fund balances arising out of the custody relationship.
The credit is based on collected balances reduced by balances required
to support the activity charges of the accounts. The monthly earnings
allowance is equal to 75% of the 90-day T-xxxx rate.
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C. SECURITIES LENDING, FOREIGN EXCHANGE & CASH MANAGEMENT
o The assumption was made that Investors Bank would perform securities
lending, if applicable, foreign exchange and cash management for the
portfolios. Securities Lending revenue is split with the funds and
Investors Bank on a 60/40% basis: 60% going to the funds.
D. PAYMENT
o The above fees will be charged against the fund's custodian checking
account five business days after the invoice is mailed.
E. SYSTEMS
o The details of any systems work will be determined after a thorough
business analysis. System's work will be billed on a time and material
basis. Investors Bank provides an allowance of 10 system hours for
data extract set up and reporting extract set up. Additional systems
hours will be billed on a time and material basis.
* A LETTER OF INTENT ACCOMPANIED BY A $25,000 DEPOSIT TO BE CREDITED AGAINST
FUTURE FEES IS REQUIRED TO BEGIN THIS IMPLEMENTATION. THIS FEE SCHEDULE IS VALID
FOR 60 DAYS FROM DATE OF ISSUE AND ASSUMES THE EXECUTION OF OUR STANDARD
CONTRACTUAL AGREEMENTS FOR A MINIMUM OF THREE YEARS.
* THIS FEE SCHEDULE IS CONFIDENTIAL INFORMATION OF THE PARTIES AND SHALL NOT BE
DISCLOSED TO ANY THIRD PARTY WITHOUT PRIOR WRITTEN CONSENT OF BOTH PARTIES.
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