RECORDKEEPING AGREEMENT
THIS AGREEMENT made as of this ____ day of _________, 1997, by and
between PILGRIM AMERICA BANK AND THRIFT FUND, INC., a Maryland corporation,
having its principal place of business at Two Renaissance Square, 00 Xxxxx
Xxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxx 00000 ("Fund"), and INVESTORS
FIDUCIARY TRUST COMPANY, a state chartered trust company organized and existing
under the laws of the State of Missouri, having its principal place of business
at 000 Xxxx 00xx Xxxxxx, Xxxxxx Xxxx, Xxxxxxxx, 00000 ("IFTC"):
WITNESSETH:
In consideration of the mutual promises herein contained, the parties
hereto, intending to be legally bound, mutually covenant and agree as follows:
1. Appointment of Recordkeeping Agent. Fund hereby constitutes and
appoints IFTC as Recordkeeping Agent for the Fund to perform certain
accounting and recordkeeping functions related to portfolio
transactions required of Fund as a registered investment company in
compliance with Rule 31a of the Investment Company Act of 1940 ("1940
Act") and to calculate daily the Fund's net asset value.
2. Representations and Warranties of Fund.
A. Fund represents and warrants that it is a corporation duly
organized as heretofore described and existing and in good
standing under the laws of Maryland.
B. Fund represents and warrants that it has the power and
authority under applicable laws, its articles of incorporation
and bylaws, and has taken all action necessary, to enter into
and perform this Agreement.
C. Fund represents and warrants that it has determined that the
computerized recordkeeping system to be used by IFTC in
maintaining accounting records of Fund hereunder, (the
"System") is appropriate and suitable for Fund's needs.
D. Fund shall preserve the confidentiality of the System and the
tapes, books, reference manuals, instructions, records,
programs, documentation and information of, and other
materials relevant to, the System and the business of IFTC
("Confidential Information"). Fund shall not voluntarily
disclose such Confidential Information to any other person
other than its own employees who reasonably have a need to
know such information pursuant to this Agreement. Fund shall
return all such Confidential Information to IFTC upon
termination or expiration of this Agreement.
E. Fund has been informed that the System is licensed for use by
IFTC from a third party ("Licensor"). Fund acknowledges that
IFTC and Licensor have proprietary rights in and to the System
and all other IFTC and Licensor programs, code,
techniques, know-how, data bases, supporting documentation,
data formats and procedures, including without limitation any
changes or modifications made at the request or expense or
both of Fund (collectively, the "Protected Information"). Fund
acknowledges that the Protected Information constitutes
confidential material and trade secrets of IFTC and Licensor.
Fund shall preserve the confidentiality of the Protected
Information, and Fund hereby acknowledges that any
unauthorized use, misuse, disclosure or taking of Protected
Information, residing or existing internal or external to a
computer, computer system, or computer network, or the knowing
and unauthorized accessing or causing to be accessed of any
computer, computer system, or computer network, may be subject
to civil liabilities and criminal penalties under applicable
law. Fund shall so inform employees and agents who have access
to the Protected Information or to any computer equipment
capable of accessing the same. Licensor is intended to be and
shall be third party beneficiaries of the Fund's obligations
and undertakings contained in this paragraph.
F. If IFTC shall provide Fund direct access to the System or if
IFTC and Fund shall agree to utilize any electronic system of
communication, Fund shall be fully responsible for any and all
consequences of the use or misuse of the terminal device,
passwords, access instructions and other means of access to
such System which are utilized by, assigned to or otherwise
made available to the Fund. Fund agrees to implement and
enforce appropriate security policies and procedures to
prevent unauthorized or improper access to or use of such
System. IFTC shall be fully protected in acting hereunder upon
any instructions, communications, data or other information
received by IFTC by such means as fully and to the same effect
as if delivered to IFTC by written instrument signed by the
requisite authorized representative(s) of the Fund. Fund shall
indemnify and hold IFTC harmless from and against any and all
costs, expenses, losses, liabilities, damages, charges and
counsel fees which may be asserted against or incurred by IFTC
as a consequence of the use or misuse, whether authorized or
unauthorized, of the System or other computerized
recordkeeping and reporting system to which IFTC provides Fund
direct access hereunder or of any other electronic system of
communication used hereunder by Fund or by any person who
acquires access to any such system through the terminal
device, passwords, access instructions or other means of
access to any such system which are utilized by, assigned to
or otherwise made available to the Fund, except to the extent
attributable to any negligence or willful misconduct by IFTC.
3. Representation and Warranties of IFTC
A. It is a trust company duly organized and existing and in good
standing under the laws of the State of Missouri.
B. It has the requisite power and authority under applicable
laws, by its charter and bylaws, and by agreement to enter
into this Agreement and has taken all action
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necessary to enter into and perform the services contemplated
herein and this Agreement has been duly executed and delivered
by IFTC and constitutes a legal, valid and binding obligation
of IFTC, enforceable in accordance with its terms.
4. Duties and Responsibilities of IFTC
A. Fund shall turn over to IFTC all of Fund's accounts and
records previously maintained. IFTC shall be entitled to rely
conclusively on the completeness and correctness of the
accounts and records turned over to it by Fund and Fund shall
indemnify and hold IFTC harmless of and from any and all
expenses, damages and losses whatsoever arising out of or in
connection with any error, omission, inaccuracy or other
deficiency of such accounts and records or in the failure of
Fund to provide any portion of such or to provide in a timely
manner any other information needed by IFTC to perform its
function hereunder.
B. Accounts and Records
1. IFTC, with the direction and as interpreted by the
Fund or Fund's accountants and/or other advisors,
will prepare and maintain in complete, accurate, and
current form all accounts and records needed to be
maintained as a basis for calculation of the Fund's
net asset value and as further agreed upon by the
parties in writing, and will preserve such records in
the manner and for the periods required by the 1940
Act or such longer period as the parties may agree
upon in writing.
2. Unless the information necessary to perform the above
functions is furnished in writing or its electronic
or digital equivalent to IFTC prior to the next close
of the New York Stock Exchange and calculation of the
Fund's net asset value, IFTC shall incur no liability
and the Fund shall indemnify and hold IFTC harmless
from and against any liability in connection
therewith.
3. It shall be the responsibility of Fund to furnish
IFTC with the declaration, record and payment dates
and amounts of any dividends or income and any other
special actions required concerning the assets in the
portfolio when such information is not readily
available from generally accepted securities industry
services or publications.
4. The accounts and records maintained and preserved by
IFTC shall be the property of the Fund and shall be
made available to the Fund for inspection or
reproduction within a reasonable time, upon demand.
5. IFTC shall assist Fund's independent accountants, or
upon approval of Fund or upon demand, any regulatory
body, in any requested review of Fund's accounts and
records maintained by IFTC but shall be reimbursed
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by Fund for all expenses and employee time invested
in any such review outside of routine and normal
periodic reviews.
6. Upon receipt from Fund of any necessary information,
IFTC shall provide information from the books and
records it maintains for Fund that Fund needs for tax
returns, questionnaires, or periodic reports to
shareholders and such other reports and information
requests as Fund and IFTC shall agree upon from time
to time.
7. IFTC and Fund may from time to time adopt procedures
as they agree upon, and IFTC may conclusively assume
that any procedure approved by Fund, or directed by
Fund, does not conflict with or violate any
requirements of Fund's prospectus, declaration of
trust, bylaws, or any rule or regulation of any
applicable regulatory body or governmental agency.
Fund shall be responsible to notify IFTC of any
changes in statutes, rules, requirements, or policies
which may necessitate changes in IFTC's
responsibilities or procedures.
8. IFTC will calculate the Fund's net asset value in
accordance with the Fund's prospectus once daily.
IFTC will price the securities of the Fund for which
market quotations are available by the use of outside
services designated by Fund which are normally used
and contracted with for this purpose; all other
securities and foreign currency holdings and all
loans and interests in loans held by the Fund will be
priced in accordance with Fund's instructions.
5. Limitation of Liability of IFTC
A. IFTC shall not be responsible or liable for, and Fund shall
indemnify and hold IFTC harmless from and against, any loss or
liability arising out of IFTC's action or omission to act
pursuant hereto, except for any loss or damage arising from
any negligent act or willful misconduct of IFTC. IFTC shall
indemnify and hold harmless Fund from and against any loss or
liability arising from such negligence or willful misconduct.
The Fund agrees to minimize any potential monetary loss(es) by
reprocessing shareholder transactions or employing any other
customary procedures to reduce such monetary loss(es). Neither
party shall be liable to the other for consequential, special,
or punitive damages. IFTC may request and obtain the advice
and opinion of counsel for Fund or its own counsel at the
expense of Fund with respect to questions or matters of law,
and it shall be without liability to Fund for any action taken
or omitted by it in good faith, in conformity with such advice
or opinion.
B. IFTC may rely upon the advice and statements of Fund, its
distributor, its management company and its accountants,
officers and other authorized individuals (as provided by
corporate resolution to IFTC) and others believed by it in
good
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faith to be expert in matters upon which they are consulted.
Actions or inaction taken in reliance on such advice and
statements shall not be considered "negligent" and IFTC shall
not be liable for any actions taken in good faith upon such
advice and statements.
C. If Fund requests IFTC in any capacity to take any action which
involves the payment of money by it, or which in IFTC's
opinion might make it liable for payment of money or in any
other way, IFTC shall be and be kept indemnified by Fund in an
amount and form satisfactory to IFTC against any liability on
account of such action; provided, however that IFTC shall not
be obligated to expend its own moneys or to take any such
action except in IFTC's sole discretion.
D. IFTC shall be entitled to receive and Fund agrees to pay to
IFTC, on demand, reimbursement for such cash disbursements,
costs and expenses as may be agreed upon in writing from time
to time by IFTC and Fund.
E. IFTC shall be protected in acting hereunder upon any
instructions, advice, notice, request, consent, certificate or
other instrument or paper appearing to it to be genuine and to
have been properly executed and shall, unless otherwise
specifically provided herein, be entitled to receive as
conclusive proof of any fact or matter required to be
ascertained from Fund as determined by IFTC, instructions or a
certificate signed by Fund's President or other officer of
Fund as requested by IFTC.
F. Without limiting the generality of the foregoing, IFTC shall
be under no duty or obligation to inquire into, and shall not
be liable for:
1. The validity of the issue of any assets purchased by
or for Fund, or the legality of the purchase thereof,
the sufficiency of the evidence of ownership of any
assets of Fund, or the propriety of the decision to
purchase or amount paid for any assets;
2. The legality of the sale of any assets by or for
Fund, or the propriety of the amount for which the
same are sold;
3. The legality of the issue or sale of any shares of
Fund, or the sufficiency of the amount to be received
therefore;
4. The legality of the purchase, repurchase or
redemption of any shares of Fund, or the propriety of
the amount to be paid therefore; or
5. The legality of the declaration of any dividend by
Fund, or the legality of the issue of any shares of
Fund in payment of any dividend.
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G. IFTC shall not be liable for, or considered to be the
custodian of, any money represented by any check, draft, wire
transfer, clearing house funds, uncollected funds, or
instrument for the payment of money received by it on behalf
of Fund, until IFTC actually receives such money, provided
only that it shall advise Fund promptly if it fails to receive
any such moneys in the ordinary course of business, and use
reasonable efforts and cooperate with Fund toward the end that
such money shall be received.
H. Notwithstanding anything herein to the contrary, it is
expressly understood and agreed that IFTC shall have no
responsibility to Fund, the Fund's shareowners or any other
person or entity for moneys or securities of Fund held by
banks or trust companies as custodians in the absence of
negligence or willful misconduct of IFTC.
I. IFTC shall not use any information made available to it under
the terms of this Agreement for any purpose other than
complying with its duties and responsibilities under this
Agreement or as specifically authorized by Fund in writing to
IFTC.
6. Force Majeure. IFTC shall not be responsible or liable for any failure
or delay in performance of its obligations under this Agreement arising
out of or caused, directly or indirectly, by circumstances beyond its
reasonable control, including without limitation any interruption, loss
or malfunction of any utility, transportation, computer (hardware or
software) or communication service; or inability to obtain labor,
material, equipment or transportation; nor shall any such failure or
delay give Fund any additional right to terminate this Agreement.
7. Compensation. Fund shall pay to IFTC such compensation at such time as
may from time to time be agreed upon in writing by IFTC and Fund. Fund
shall also reimburse IFTC for all out-of-pocket expenses incurred by
IFTC in connection with services performed pursuant to this Agreement.
8. Procedures. IFTC and Fund may from time to time adopt procedures as
they agree upon, and IFTC may conclusively assume that any procedure
approved or directed by Fund or its accountants or other advisors does
not conflict with or violate any requirements of Fund's prospectus,
articles of incorporation, bylaws, any applicable law, rule or
regulation, or any order, decree or agreement by which the Fund may be
bound.
9. Termination. This Agreement shall continue in effect until terminated
by either party by notice in writing received by the other party not
less than ninety (90) days prior to the date upon which such
termination shall take effect. Upon termination of this Agreement:
A. Fund shall pay to IFTC its fees and compensation due hereunder
and its reimbursable disbursements, costs and expenses paid or
incurred to such date.
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B. Fund shall designate a successor (which may be Fund) by notice
in writing to IFTC on or before the termination date.
C. IFTC shall deliver to the successor, or if none has been
designated, to Fund, at IFTC's office, all records, funds and
other properties of Fund deposited with or held by IFTC
hereunder. In the event that neither a successor nor Fund
takes delivery of all records, funds and other properties of
Fund by the termination date, IFTC's sole obligation with
respect thereto from the termination date until delivery to a
successor or Fund shall be to exercise reasonable care to hold
the same in custody in its form and condition as of the
termination date, and IFTC shall be entitled to reasonable
compensation therefor, including but not limited to all of its
out-of-pocket costs and expenses incurred in connection
therewith.
10. Notices. Notices, requests, instructions and other writings received by
Fund at Two Renaissance Square, 00 Xxxxx Xxxxxxx Xxxxxx, Xxxxx 0000,
Xxxxxxx, Xxxxxxx 00000, or at such address as Fund may have designated
to IFTC in writing, shall be deemed to have been properly given to Fund
hereunder; and notices, requests, instructions and other writings
received by IFTC at its offices at 000 Xxxx 00xx Xxxxxx, Xxxxxx Xxxx,
XX 00000, or to such other address as it may have designated to Fund in
writing, shall be deemed to have been properly given to IFTC hereunder.
11. Miscellaneous
A. This Agreement is executed and delivered in the State of
Missouri and shall be governed by the laws of said state.
B. All terms and provisions of this Agreement shall be binding
upon, inure to the benefit of and be enforceable by the
parties hereto and their respective successors and permitted
assigns.
C. No provisions of the Agreement may be amended or modified in
any manner except by a written agreement properly authorized
and executed by both parties hereto.
D. The captions in the Agreement are included for convenience of
reference only, and in no way define or limit any of the
provisions hereof or otherwise affect their construction or
effort.
E. This Agreement may be executed in two or more counterparts,
each of which shall be deemed an original but all of which
together shall constitute one and the same instrument.
F. If any part, term or provision of this Agreement is determined
to be illegal, in conflict with any law or otherwise invalid,
the remaining portion or portions shall be considered
severable and not be affected, and the rights and obligations
of the
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parties shall be construed and enforced as if the Agreement
did not contain the particular part, term or provision held to
be illegal or invalid.
G. This Agreement may not be assigned by either party without
prior written consent in writing of the other party.
H. The representations and warranties, the indemnification
extended hereunder, and the provisions of Section 2.D. and
2.E. are intended to and shall continue after and survive the
expiration, termination or cancellation of this Agreement.
I. The Recordkeeping Agreement between IFTC and Fund, then known
as Pilgrim Regional Bankshares, Inc. dated as of December 1,
1986; is hereby cancelled and superseded effective as of the
date hereof, except that all rights, duties and liabilities
which may have arisen under such Agreement prior to the
effectiveness hereof shall continue and survive. Otherwise,
this Agreement does not in any way affect any other agreements
entered into between the parties hereto.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their respective and duly authorized corporate or trust officers.
INVESTORS FIDUCIARY TRUST COMPANY
By:
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Title:
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PILGRIM AMERICA BANK AND THRIFT FUND, INC.
By:
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Title:
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