EXHIBIT (H)(1)
TRANSFER AGENCY AND SERVICES AGREEMENT
THIS AGREEMENT, dated as of this ---- day of --------, 1999 between
PRINCIPAL PRESERVATION PORTFOLIOS, INC. (the "'Fund"), a Maryland
corporation having its principal place of business at 000 Xxxxx Xxxx
Xxxxxx, Xxxx Xxxx, XX 000000000 and FIRST DATA INVESTOR SERVICES GROUP,
INC. ("Investor Services Group"), a Massachusetts corporation with
principal offices at 0000 Xxxxxxxx Xxxxx, Xxxxxxxx, Xxxxxxxxxxxxx 00000.
WITNESSETH
----------
WHEREAS, the Fund is authorized to issue Shares in separate series,
with each such series representing interests in a separate portfolio of
securities or other assets.
WHEREAS, the Fund initially intends to offer Shares in those
Portfolios identified in the attached Schedule A, each such Portfolio,
together with all other Portfolios subsequently established by the Fund
shall be subject to this Agreement in accordance with Article 14;
WHEREAS, the Fund on behalf of the Portfolios, desires to appoint
Investor Services Group as its transfer agent, dividend disbursing agent
and agent in connection with certain other activities and Investor Services
Group desires to accept such appointment;
NOW, THEREFORE, in consideration of the mutual covenants and promises
hereinafter set forth, the Fund and Investor Services Group agree as
follows:
1. Definitions.
----------------
1.1. Whenever used in this Agreement, the following words and phrases,
-----
unless the context otherwise requires, shall have the following meanings:
(a) "Articles of Incorporation" shall mean the Articles of
Incorporation, Declaration of Trust, or other similar organizational
document as the case may be, of the Fund as the same may be amended
from time to time.
(b) "Authorized Person" shall be deemed to include (i) any
authorized officer of the Fund; or (ii) any person, whether or not
such person is an officer or employee of the Fund, duly authorized to
give Oral Instructions or Written Instructions on behalf of the Fund
as indicated in writing to Investor Services Group from time to time.
(c) "Board Members" shall mean the Directors or Trustees of the
governing body of the Fund, as the case may be.
(d) "Board of Directors" shall mean the Board of Directors or
Board of Trustees of the Fund, as the case may be.
(e) "Commission shall mean the Securities and Exchange
Commission.
(f) "Custodian" refers to any custodian or subcustodian of
securities and other property which the Fund may from time to. time
deposit, or cause to be deposited or held under the name or account of
such a custodian pursuant to a Custodian Agreement.
(g) 1934 Act" shall mean the Securities Exchange Act of 1934 and
the rules and regulations promulgated thereunder, all as amended from
time to time.
(h) 1940 Act" shall mean the Investment Company Act of 1940 and
the rules and regulations promulgated thereunder, all as amended from
time to time.
(i) "Oral Instructions" shall mean instructions, other than
Written Instructions, actually received by Investor Services Group
from a person reasonably believed by Investor Services Group to be an
Authorized Person;
(j). "Portfolio" shall mean each separate series of shares
offered by the Fund representing interests in a separate portfolio of
securities and other assets;
(k) "Prospectus" shall mean the most recently dated Fund
Prospectus and Statement of Additional Information, including any
supplements thereto if any, which has become effective under the
Securities Act of 1933 and the 1940 Act.
(l) "Shares" refers collectively to such shares of capital stock
or beneficial interest, as the case may be, or class thereof, of each
respective Portfolio of the Fund as may be issued from time to time.
(m) "Shareholder" shall mean a record owner of Shares of each
respective Portfolio of the Fund.
(n) "Written Instructions" shall mean a written communication
signed by a person reasonably believed by Investor Services Group to
be an Authorized Person and actually received by Investor Services
Group. Written Instructions shall include manually executed originals
and authorized electronic transmissions, including telefacsimile of a
manually executed original or other process.
2. Appointment of Investor Services Group.
The Fund, on behalf of the Portfolios, hereby appoints and constitutes
Investor Services Group as its sole and exclusive transfer agent and
dividend disbursing agent for Shares of each respective Portfolio of the
Fund and as shareholder servicing agent for the Fund and Investor Services
Group hereby accepts such appointments and agrees to perform the duties
hereinafter set forth.
3. Duties of Investor Services Group.
3.1. Investor Services Group shall be responsible for:
(a) Administering and/or performing the customary services of a
transfer agent; acting as service agent in connection with dividend
and distribution functions; and for performing shareholder account and
administrative agent functions in connection -with the issuance,
transfer and redemption or repurchase (including coordination with the
Custodian) of Shares of each Portfolio, as more fully described in the
written schedule of Duties of Investor Services Group annexed hereto
as Schedule B and incorporated herein, and in accordance with the
terms of the Prospectus of the Fund on behalf of the applicable
Portfolio, applicable law and the procedures established from time to
time between Investor Services Group and the Fund.
(b) Recording the issuance of Shares and maintaining pursuant to
Rule 17Ad10(e) of the 1934 Act a record of the total number of Shares
of each Portfolio which are authorized, based upon data provided to it
by the Fund, and issued and outstanding. Investor Services Group shall
provide the Fund on a regular basis with the total number of Shares of
each Portfolio 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 Fund.
(c) In addition to providing the foregoing services, the Fund
hereby engages Investor Services Group as its exclusive print/mail
service provider with respect to the print/mail items identified in
Schedule C for the fees also set forth in Schedule C. Investor
Services Group agrees to perform the services and its obligations
subject to the terms and conditions of this Agreement.
(d) Notwithstanding any of the foregoing provisions of this
Agreement, Investor Services Group shall be under no duty or
obligation to inquire into, and shall not be liable for: (i) the
legality of the issuance or sale of any Shares or the sufficiency of
the amount to be received therefor; (ii) the legality of the
redemption of any Shares, or the propriety of the amount to be paid
therefor; (iii) the legality of the declaration of any dividend by the
Board of Directors, or the legality of the issuance of any Shares in
payment of any dividend; or (iv) the legality of any recapitalization
or readjustment of the Shares.
3.2. In addition, the Fund shall (i) identify to Investor Services
Group in writing those transactions and assets to be treated as exempt from
blue sky reporting for each State and (ii) verify the establishment of
transactions for each State on the system prior to activation and
thereafter monitor the daily activity for each State. The responsibility of
Investor Services Group for the Fund's blue sky State registration status
is solely limited to the initial establishment of transactions subject to
blue sky compliance by the Fund and the reporting of such transactions to
the Fund as provided above.
3.3. In addition to the duties set forth herein, Investor Services
Group shall perform such other duties and functions, and shall be paid such
amounts therefor, as may from time to time be agreed upon in writing
between the Fund and Investor Services Group.
4. Recordkeeping and Other Information.
4.1. Investor Services Group shall create and maintain all records
required of it pursuant to its duties hereunder and as set forth in
Schedule B in accordance with all applicable laws, rules and regulations,
including records required by Section 31(a) of the 1940 Act. Where
applicable, such records shall be maintained by Investor Services Group for
the periods and in the places required by Rule 31a2 under the 0000 Xxx.
4.2. To the extent required by Section 31 of the 1940 Act, Investor
Services Group agrees that all such records prepared or maintained by
Investor Services Group relating to, the services to be performed by
Investor Services Group hereunder are the property of the Fund and will be
preserved, maintained and made available in accordance with such section,
and will, at the expense of the Fund, be surrendered promptly to the Fund
on and in accordance with the Fund's request.
4.3. In case of any requests or demands for the inspection of
Shareholder records of the Fund, Investor Services Group will endeavor to
notify the Fund of such request and secure Written Instructions as to the
handling of such request. Investor Services Group reserves the right,
however, to exhibit the Shareholder records to any person whenever it is
advised by its counsel that it may be held liable for the failure to comply
with such request.
5. Fund Instructions.
5.1. Investor Services Group will have no liability when acting upon
Written or Oral Instructions believed to have been executed or orally
communicated by an Authorized Person and will not be held to have any
notice of any change of authority of any person until receipt of a Written
Instruction thereof from the Fund. Investor Services Group will also have
no liability when processing Share certificates which it reasonably
believes to bear the proper manual or facsimile signatures of the officers
of the Fund and the proper countersignature of Investor Services Group.
5.2. At any time, Investor Services Group may request Written
Instructions from the Fund and may seek advice from legal counsel for the
Fund, or its own legal counsel, with respect to any matter arising in
connection with this Agreement, and it shall not be liable for any action
taken or not taken or suffered by it in good faith in accordance with such
Written Instructions or in accordance with the opinion of counsel for the
Fund or for Investor Services Group. Written Instructions requested by
Investor Services Group will be provided by the Fund within a reasonable
period of time.
5.3. Investor Services Group, its officers, agents or employees, shall
accept Oral Instructions or Written Instructions given to them by any
person representing or acting on behalf of the Fund only if said
representative is an Authorized Person. The Fund agrees that all Oral
instructions shall be followed within one business day by confirming
Written Instructions, and that the Fund's failure to so confirm shall not
impair in any respect Investor Services Group's right to rely on Oral
Instructions.
6. Compensation.
6.1. The Fund on behalf of each of the Portfolios will compensate
Investor Services Group for the performance of its obligations hereunder in
accordance with the fees and charges set forth in the written Fee Schedule
annexed hereto as Schedule C and incorporated herein.
6.2. In addition to those fees and charges referenced in Section 6.1
above, the Fund on behalf of each of the Portfolios agrees to pay for such
outofpocket expenses incurred by Investor Services Group in the performance
of its duties hereunder. Outofpocket expenses shall include, but shall not
be limited to, the items specified in the written schedule of outofpocket
expenses annexed hereto as Schedule D and incorporated herein.. Unspecified
outofpocket expenses shall be limited to those outofpocket expenses
reasonably incurred by Investor Services Group in the performance of its
obligations hereunder.
6.3. The Fund on behalf of each of the Portfolios agrees to pay all
fees, charges and outofpocket expenses to Investor Services Group by
Federal Funds Wire within fifteen (15) business days following the receipt
of the respective invoice. In addition, with respect to all invoices issued
pursuant to this Agreement, Investor Services Group may charge a service
fee equal to the lesser of (i) one and one half percent (1 1/2%) per month
or (ii) the highest interest rate legally permitted on any past due
invoiced amounts, provided however, the foregoing service fee shall not
apply if the Fund in good faith legitimately disputes any invoice amount in
which case the Fund shall do the following within thirty (30) days of the
postmark date: (a) pay Investor Services Group the undisputed amount of the
invoice; and (b) provide Investor Services Group a detailed written
description of the disputed amount and the basis for the Fund's dispute
with such amount. In addition, the Fund shall cooperate with Investor
Services Group in resolving disputed invoice amounts and then promptly
paying such amounts determined to be due.
6.4. The Fund acknowledges that the fees that Investor Services Group
charges the Fund under this Agreement reflect the allocation of risk
between the parties, including the disclaimer of warranties in Section 9.3
and the limitations on liability and exclusion of remedies in Section 11.2
and Article 12. Modifying the allocation of risk from what is stated here
would affect the fees that Investor Services Group charges, and in
consideration of those fees, the Fund agrees to the stated allocation of
risk.
7. Documents.
In connection with the appointment of Investor Services Group, the
Fund shall, on or before the date this Agreement goes into effect, but in
any case within a reasonable period of time for Investor Services Group to
prepare to perform its duties hereunder, deliver or caused to be delivered
to Investor Services Group the documents set forth in the written schedule
of Fund Documents annexed hereto as Schedule E.
8. Transfer Agent System.
8.1. Investor Services Group shall retain title to and ownership of
any and all data bases, computer programs, screen formats, report formats,
interactive design techniques, derivative works, inventions, discoveries,
patentable or copyrightable matters, concepts, expertise, patents,
copyrights, trade secrets, and other related legal rights utilized by
Investor Services Group in connection with the services provided by
Investor Services Group to the Fund herein (the "Investor Services Group
System"). Except, however, that the Fund shall retain title and ownership
in any and all data it delivers to Investor Services Group under this
Agreement, as well as title and ownership of all information contained in
any reports generated from such data,
8.2. Investor Services Group hereby grants to the Fund a limited
license to the Investor Services Group System for the sole and limited
purpose of having Investor Services Group provide the services contemplated
hereunder and nothing contained in this Agreement shall be construed or
interpreted otherwise and such license shall immediately terminate with the
termination of this Agreement.
8.3. In the event that the Fund, including any affiliate or agent of
the Fund or any third party acting on behalf of the Fund is provided with
direct access to the Investor Services Group System for either account
inquiry or to transmit transaction information, including but not limited
to maintenance, exchanges, purchases and redemptions, such direct access
capability shall be limited to direct entry to the Investor Services Group
System by means of online mainframe terminal entry or PC emulation of such
mainframe terminal entry and any other nonconforming method of transmission
of information to the Investor Services Group System is strictly prohibited
without the prior written consent of Investor Services Group.
9. Representations and Warranties.
9.1. Investor Services Group represents and warrants to the Fund that:
(a) it is a corporation duly organized, existing and in good
standing under the laws of the Commonwealth of Massachusetts;
(b) it is empowered under applicable laws and by its Articles of
Incorporation and ByLaws to enter into and perform this Agreement;
(c) all requisite corporate proceedings have been taken to
authorize it to enter into this Agreement;
(d) it is duly registered with its appropriate regulatory agency
as a transfer agent and such registration will remain in effect for
the duration of this Agreement;
(e) it has and will continue to have access to the necessary
facilities, equipment and personnel to perform its duties and
obligations under this Agreement; and
(f) all equipment and software provided or used by Investor
Services Group 0r any of its subsidiaries or divisions in connection
with rendering services to the Company under the terms of this
Agreement, include or shall include design and performance
capabilities so that prior to, during, and after December 31, 1999
(the "Millennium Date Change") they will not malfunction, produce
invalid or incorrect results, cause an interruption in or diminish the
quality of the services provided to the Company, or abnormally cease
to function due to the Millennium Date Change. Such design and
performance capabilities shall include without limitation the ability
to recognize and process the Year 2000 and thereafter and to manage
and manipulate data involving dates, including without limitation, (i)
single century and multicentury formulas and date values without
resulting in the generation of incorrect values involving such dates
or causing an abnormal ending, (ii) date data interfaces with
functionalities and data fields that indicate the century, and (iii)
daterelated functions that indicate the century.
9.2. The Fund represents and warrants to Investor Services Group that:
(a) it is duly organized, existing and in good standing under
the laws of the jurisdiction in which it is organized;
(b) it is empowered under applicable laws and by its Articles of
Incorporation and ByLaws to enter into this Agreement;
(c) all corporate proceedings required by said Articles of
Incorporation, By Laws and applicable laws have been taken to
authorize it to enter into this Agreement;
(d) a registration statement under the Securities Act of 1933,
as amended, and the 1940 Act on behalf of each of the Portfolios is
currently effective and will remain effective, and all appropriate
state securities law filings have been made and will continue to be
made, with respect to all Shares of the Fund being offered for sale;
and
(e) all outstanding Shares are validly issued, fully paid and
nonassessable and when Shares are hereafter issued in accordance with
the terms of the Fund's Articles of Incorporation and its Prospectus
with respect to each Portfolio, such Shares shall be validly issued,
fully paid and nonassessable.
9.3. THIS IS A SERVICE AGREEMENT. EXCEPT AS EXPRESSLY PROVIDED IN THIS
AGREEMENT, INVESTOR SERVICES GROUP DISCLAIMS ALL OTHER REPRESENTATIONS OR
WARRANTIES, EXPRESS OR IMPLIED, MADE TO THE FUND OR ANY OTHER PERSON,
INCLUDING, WITHOUT LIMITATION, ANY WARRANTIES REGARDING QUALITY,
SUITABILITY, MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE OR OTHERWISE
(IRRESPECTIVE OF ANY COURSE OF DEALING, CUSTOM OR USAGE OF TRADE) OF ANY
SERVICES OR ANY GOODS PROVIDED INCIDENTAL TO SERVICES PROVIDED UNDER THIS
AGREEMENT. INVESTOR SERVICES GROUP DISCLAIMS ANY WARRANTY OF TITLE OR NON-
INFRINGEMENT EXCEPT AS OTHERWISE SET FORTH IN THIS AGREEMENT.
10. Indemnification.
10.1. Investor Services Group shall not be responsible for and the
Fund on behalf of each Portfolio shall indemnify and hold Investor Services
Group harmless from and against any and all claims, costs, expenses
(including reasonable attorneys' fees), losses, damages, charges, payments
and liabilities of any sort or kind which may be asserted against Investor
Services Group or for which Investor Services Group may be held to be
liable (a "Claim") arising out of or attributable to any of the following:
(a) any actions of Investor Services Group required to be taken
pursuant to this Agreement unless such Claim resulted from a breach of
any representation or warranty made by Investor Services Group under
this Agreement, a negligent act or omission to act or bad faith by
Investor Services Group in the performance of its duties hereunder;
(b) Investor Services Group's reasonable reliance on, or
reasonable use of information, data, records and documents (including
but not limited to magnetic tapes, computer printouts, hard copies and
microfilm copies) received by Investor Services Group from the Fund,
or any authorized third party acting on behalf of the Fund, including
but not limited to the prior transfer agent for the Fund, in the
performance of Investor Services Group's duties and obligations
hereunder;
(c) the reliance on, or the implementation of, any Written or
Oral Instructions or any other instructions or requests of the Fund on
behalf of the applicable Portfolio;
(d) the offer or sales of shares in violation of any requirement
under the securities laws or regulations of any state that such shares
be registered in such state or in violation of any stop order or other
determination or ruling by any state with respect to the offer or sale
of such shares in such state; and
(e) the Fund's refusal or failure to comply with the terms of
this Agreement, or any Claim which arises out of the Fund's negligence
or misconduct or the breach of any representation or warranty of the
Fund made herein.
10.2. The Fund shall not be responsible for and Investor Services
Group shall indemnify and hold the Fund harmless from and against any and
all claims, demands, losses, expenses and liabilities (whether with or
without a basis in fact or law) of any and every nature (including
reasonable attorneys' fees) which the Fund may sustain or incur or which
may be asserted against the Fund by any person arising out a breach of any
representation or warranty made by Investor Services Group under this
Agreement or any action taken or omitted to be taken by Investor Services
Group, or as a result of Investor Services Group's refusal or failure to
comply with the terms of this Agreement, its bad faith, negligence or
willful misconduct.
10.3. In any case in which the indemnitor may be asked to
indemnify or hold the indemnitee harmless, the indemnitee will notify the
indemnitor promptly after identifying any situation which it believes
presents or appears likely to present a claim for indemnification, although
the failure to do so shall not prevent recovery by the indemnitee, and the
indemnitee shall keep the indemnitor advised with respect to all
developments concerning such situation. The indemnitor shall have the
option to defend the indemnitee against any claim which may be the subject
of this indemnification, and, in the event that the indemnitor so elects,
such defense shall be conducted by counsel chosen by the indemnitor and
satisfactory to the indemnitee, and thereupon the indemnitor shall take
over complete defense of the claim and the indemnitee shall sustain no
further legal or other expenses in respect of such claim. The indemnitee
will not confess any claim or make any compromise in any case in which the
indemnitor will be asked to provide indemnification, except with the
indemnitor's prior written consent. The obligations of the parties hereto
under this Article 10 shall survive the termination of this Agreement.
10.4. Any claim for indemnification under this Agreement must be
made prior to the earlier of:
(a) one year after the indemnitee becomes aware of the event for
which indemnification is claimed; or
(b) one year after the earlier of the termination of this
Agreement or the expiration of the term of this Agreement.
10.5. Except for remedies that cannot be waived as a matter of law
(and provisional relief), the provisions of this Article 10 shall be
Investor Services Group's and the Fund's sole and exclusive remedy for
claims or other actions or proceedings to which the parties'
indemnification obligations pursuant to this Article 10 may apply.
11. Standard of Care.
11.1. Investor Services Group shall at all times act in good faith
and agrees to use its best efforts within commercially reasonable limits to
ensure the accuracy of all services performed under this Agreement, but
assumes no responsibility for loss or damage to the Fund unless said errors
are caused by Investor Services Group's own negligence, bad faith or
willful misconduct or that of its employees.
11.2. Notwithstanding any provision in this Agreement to the
contrary, Investor Services Group's cumulative liability (to the Fund) for
all losses, claims, suits, controversies, breaches, or damages for any
cause whatsoever (including but not limited to those arising out of or
related to this Agreement) and regardless of the form of action or legal
theory shall not exceed $1,000,000; provided no such limitation shall apply
in the case of Investor Services Group's intentional or willful violation
of Section 15 of this Agreement. Fund understands the limitation on
Investor Services Group's damages to be a reasonable allocation of risk and
Fund expressly consents with respect to such allocation of risk. In
allocating risk under the Agreement, the parties agree that the damage
limitation set forth above shall apply to any alternative remedy ordered by
a court in the event such court determines that sole and exclusive remedy
provided for in the Agreement fails of its essential purpose.
11.3. Neither party may assert any cause of action against the
other party under this Agreement that accrued more than two (2) years prior
to the filing of the suit (or commencement of arbitration proceedings)
alleging such cause of action.
11.4. Each party shall have the duty to mitigate damages for which
the other party may become responsible.
12. Consequential Damages.
NOTWITHSTANDING ANYTHING IN THIS AGREEMENT TO THE CONTRARY, IN NO
EVENT SHALL EITHER PARTY, THEIR AFFILIATES OR ANY OF ITS OR THEIR
DIRECTORS, OFFICERS, EMPLOYEES, AGENTS OR SUBCONTRACTORS BE LIABLE UNDER
ANY THEORY OF TORT, CONTRACT, STRICT LIABILITY OR OTHER LEGAL OR EQUITABLE
THEORY FOR LOST PROFITS, EXEMPLARY, PUNITIVE, SPECIAL, INCIDENTAL, INDIRECT
OR CONSEQUENTIAL DAMAGES, EACH OF WHICH IS HEREBY EXCLUDED BY AGREEMENT OF
THE PARTIES REGARDLESS OF WHETHER SUCH DAMAGES WERE FORESEEABLE OR WHETHER
EITHER PARTY OR ANY ENTITY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH
DAMAGES.
13. Term and Termination.
13.1. This Agreement shall be effective on the date first written
above and shall continue for a period of three (3) years (the "Initial
Term").
13.2. Upon the expiration of the Initial Term, this Agreement
shall automatically renew for successive terms of one (1) year ("Renewal
Terms") each, unless the Fund or Investor Services Group provides written
notice to the other of its intent not to renew. Such notice must be
received not less than ninety (90) days and not more than onehundred eighty
(180) days prior to the expiration of the Initial Term or the then current
Renewal Term.
13.3. In the event a termination notice is given by the Fund, all
reasonable expenses associated with movement of records and materials and
conversion thereof to a successor transfer agent will be borne by the Fund.
13.4. If a party hereto is guilty of a material failure to perform
its duties and obligations hereunder (a "Defaulting Party") the other party
(the "NonDefaulting Party") may give written notice thereof to the
Defaulting Party, and if such material breach shall not have been remedied
within thirty (30) days after such written notice is given, then the
NonDefaulting Party may terminate this Agreement by giving thirty (30) days
written notice of such termination to the Defaulting Party. If Investor
Services Group is the NonDefaulting Party, its termination of this
Agreement shall not constitute a waiver of any other rights or remedies of
Investor Services Group with respect to services performed prior to such
termination of rights of Investor Services Group to be reimbursed for
outofpocket expenses. In all cases, termination by the NonDefaulting Party
shall not constitute a waiver by the NonDefaulting Party of any other
rights it might have under this Agreement or otherwise against the
Defaulting Party.
13.5. Notwithstanding anything contained in this Agreement to the
contrary, should the Fund desire to move any of the services provided by
Investor Services Group hereunder to a successor service provider prior to
the expiration of the then current Initial or Renewal Term, or without the
required notice period, Investor Services Group shall make a good faith
effort to facilitate the conversion on such prior date, however, there can
be no guarantee that Investor Services Group will be able to facilitate a
conversion of services on such prior date. In connection with the
foregoing, should services be converted to a successor service provider for
reasons other than a default by Investor Services Group under Section 13.4
of this Agreement, or if the Fund or any Portfolio is liquidated or its
assets merged or purchased or the like with another entity which does not
utilize the services of Investor Services Group, the payment of fees to
Investor Services Group as set forth herein shall be accelerated to a date
prior to the conversion or termination of services and calculated as if the
services had remained with Investor Services Group until the expiration of
the then current Initial or Renewal Term and calculated at the asset and/or
Shareholder account levels, as the case may be, on the date notice of
termination was given to Investor Services Group; provided such fees shall
be reduced by the lost savings to Investor Services Group resulting from
its not having to provide the services described hereunder to the end of
the relevant Initial or Renewal Term.
14. Additional Portfolios.
14.1. In the event that the Fund establishes one or more
Portfolios in addition to those identified in Schedule A, with respect to
which the Fund desires to have Investor Services Group render services as
transfer agent under the terms hereof, the Fund shall so notify Investor
Services Group in writing, and if Investor Services Group agrees in writing
to provide such services, Exhibit 1 shall be amended to include such
additional Portfolios.
15. Confidentiality.
15.1. The parties agree that the Proprietary Information (defined
below) and the contents of this Agreement (collectively "Confidential
Information") are confidential information of the parties and their
respective licensors. The Fund and Investor Services Group shall exercise
at least the same degree of care, but not less than reasonable care, to
safeguard the confidentiality of the Confidential Information of the other
as it would exercise to protect its own confidential information of a
similar nature. The Fund and Investor Services Group shall not duplicate,
sell or disclose to others the Confidential Information of the other, in
whole or in part, without the prior written permission of the other party.
The Fund and Investor Services Group may, however, disclose Confidential
Information to their respective parent corporation, their respective
affiliates, their subsidiaries and affiliated companies and employees,
provided that each shall use reasonable efforts to ensure that the
Confidential Information is not duplicated or disclosed in breach of this
Agreement. The Fund and Investor Services Group may also disclose the
Confidential Information to independent contractors, auditors, and
professional advisors, provided they first agree in writing to be bound by
the confidentiality obligations substantially similar to this Section 15.1.
Notwithstanding the previous sentence, in no event shall either the Fund or
Investor Services Group disclose the Confidential Information to any
competitor of the other without specific, prior written consent.
15.2. Proprietary Information means:
(a) any data or information that is competitively sensitive
material, and not generally known to the public, including, but not
limited to, information about product plans, marketing strategies,
finance, operations, customer relationships, customer profiles, sales
estimates, business plans, and internal performance results relating
to the past, present or future business activities of the Fund or
Investor Services Group, their respective subsidiaries and affiliated
companies and the customers, clients and suppliers of any of them;
(b) any scientific or technical information, design, process,
procedure, formula, or improvement that is commercially valuable and
secret in the sense that its confidentiality affords the Fund or
Investor Services Group a competitive advantage over its competitors;
and
(c) all confidential or proprietary concepts, documentation,
reports, data, specifications, computer software, source code, object
code, flow charts, databases, inventions, knowhow, showhow and trade
secrets, whether or not patentable or copyrightable.
15.3. Confidential Information includes, without limitation, all
documents, inventions, substances, engineering and laboratory notebooks,
drawings, diagrams, specifications, bills of material, equipment,
prototypes and models, and any other tangible manifestation of the
foregoing of either party which now exist or come into the control or
possession of the other.
15.4. The obligations of confidentiality and restriction on use
herein shall not apply to any Confidential Information that a party proves:
(a) Was in the public domain prior to the date of this Agreement
or subsequently came into the public domain through no fault of such
party; or
(b) Was lawfully received by the party from a third party free
of any obligation of confidence to such third party; or
(c) Was already in the possession of the party prior to receipt
thereof, directly or indirectly, from the other party; or
(d) Is required to be disclosed in a judicial or administrative
proceeding after all reasonable legal remedies for maintaining such
information in confidence have been exhausted including, but not
limited to, giving the other party as much advance notice of the
possibility of such disclosure as practical so the other party may
attempt to stop such disclosure or obtain a protective order
concerning such disclosure; or
(e) Is subsequently and independently developed by employees,
consultants or agents of the. party without reference to the
Confidential Information disclosed under this Agreement.
16. Force Majeure.
No party shall be liable for any default or delay in the performance
of its obligations under this Agreement if and to the extent such default
or delay is caused, directly or indirectly, by (i) fire, flood, elements of
nature or other acts of God; (ii) any outbreak or escalation of
hostilities, war, riots or civil disorders in any country, (iii) any act or
omission of the other party or any governmental authority; (iv) any labor
disputes (whether or not the employees' demands are reasonable or within
the party's power to satisfy); or (v) nonperformance by a third party or
any similar cause beyond the reasonable control of such party, including
without limitation, failures or fluctuations in telecommunications or other
equipment. In any such event, the non-performing party shall be excused
from any further performance and observance of the obligations so affected
only for as long as such circumstances prevail and such party continues to
use commercially reasonable efforts to recommence performance or observance
as soon as practicable.
17. Assignment and Subcontracting.
This Agreement, its benefits and obligations shall be binding upon and
inure to the benefit of the parties hereto and their respective successors
and permitted assigns. This Agreement may not be assigned or otherwise
transferred by either party hereto, without the prior written consent of
the other party, which consent shall not be unreasonably withheld;
provided, however, that Investor Services Group may, in its sole
discretion, assign all its right, title and interest in this Agreement to
an affiliate, parent or subsidiary, or to the purchaser of substantially
all of its business. Investor Services Group may, in its sole discretion,
engage subcontractors to perform any of the obligations contained in this
Agreement to be performed by Investor Services Group.
18. Arbitration.
18.1. Any claim or controversy arising out of or relating to this
Agreement, or breach hereof, shall be settled by arbitration administered
by the American Arbitration Association in Boston, Massachusetts in
accordance with its applicable rules, except that the Federal Rules of
Evidence and the Federal Rules of Civil Procedure with respect to the
discovery process shall apply.
18.2. The parties hereby agree that judgment upon the award
rendered by the arbitrator may be entered in any court having jurisdiction.
18.3. The parties acknowledge and agree that the performance of
the obligations under this Agreement necessitates the use of
instrumentalities of interstate commerce and, notwithstanding other general
choice of law provisions in this Agreement, the parties agree that the
Federal Arbitration Act shall govern and control with respect to the
provisions of this Article 18.
19. Notice.
Any notice or other instrument authorized or required by this
Agreement to be given in writing to the Fund or Investor Services Group,
shall be sufficiently given if addressed to that party and received by it
at its office set forth below or at such other place as it may from time to
time designate in writing.
To the Fund:
Principal Preservation Portfolios, Inc.
000 Xxxxx Xxxx Xxxxxx
Xxxx Xxxx, XX 000000000
Attention: Xxx Xxxxxxxxx, President & CEO
with a copy to S. Xxxxxxx X'Xxxxx
To Investor Services Group:
First Data Investor Services Group, Inc.
0000 Xxxxxxxx Xxxxx
Xxxxxxxx, Xxxxxxxxxxxxx 00000
Attention: President
with a copy to Investor Services Group's General Counsel
20. Governing Law/Venue.
The laws of the State of New York, excluding the laws on conflicts of
laws, shall govern the interpretation, validity, and enforcement of this
agreement. All actions arising from or related to this Agreement shall be
brought in the federal district court sitting in the City of New York, and
Investor Services Group and the Fund hereby submit themselves to the
exclusive jurisdiction of this courts.
21. Counterparts.
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.
22. Caption.
The captions of this 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 effect.
23. Publicity.
Neither Investor Services Group nor the Fund shall release or publish
news releases, public announcements, advertising or other publicity
relating to this Agreement or to the transactions contemplated by it
without the prior review and written approval of the other party; provided,
however, that either party may make such disclosures as are required by
legal, accounting or regulatory requirements after making reasonable
efforts in the circumstances to consult in advance with the other party.
24. Relationship of Parties/NonSolicitation.
24.1. The parties agree that they are independent contractors and
not partners or coventurers and nothing contained herein shall be
interpreted or construed otherwise.
24.2. During the term of this Agreement and for one (1) year
afterward, the Fund shall not recruit, solicit, employ or engage, for the
Fund or others, Investor Services Group's employees.
25. Entire Agreement, Severability.
25.1. This Agreement, including Schedules, Addenda, and Exhibits
hereto, constitutes the entire Agreement between the parties with respect
to the subject matter hereof and supersedes all prior and contemporaneous
proposals, agreements, contracts, representations, and understandings,
whether written or oral, between the parties with respect to the subject
matter hereof. No change, termination, modification, or waiver of any term
or condition of the Agreement shall be valid unless in writing signed by
each party. No such writing shall be effective as against Investor Services
Group unless said writing is executed by a Senior Vice President, Executive
Vice President, or President of Investor Services Group. A party's waiver
of a breach of any term or condition in the Agreement shall not be deemed a
waiver of any subsequent breach of the same or another term or condition.
The parties intend every provision of this Agreement to be severable.
If a court of competent jurisdiction determines that any term or provision
is illegal or invalid for any reason, the illegality or invalidity shall
not affect the validity of the remainder of this Agreement. In such case,
the parties shall in good faith modify or substitute such provision
consistent with the original intent of the parties. Without limiting the
generality of this paragraph, if a court determines that any remedy stated
in this Agreement has failed of its essential purpose, then all other
provisions of this Agreement, including the limitations on liability and
exclusion of damages, shall remain fully effective.
26. Miscellaneous.
The Fund and Investor Services Group agree that the obligations of the
Fund under the Agreement shall not be binding upon any of the Board
Members, shareholders, nominees, officers, employees or agents, whether
past, present or future, of the Fund individually, but agree that such
obligations shall be limited in all cases to the respective assets and
properties of the particular Fund portfolio to which the liability relates.
The execution and delivery of this Agreement have been authorized by the
Board Members of the Fund, and signed by an authorized officer of the Fund,
acting as such, and neither such authorization by such Board Members nor
such execution and delivery by such officer shall be deemed to have been
made by any of them or any shareholder of the Fund individually or to
impose any liability on any of them or any shareholder of the Fund
personally, but shall bind only the assets and property of the Fund as
provided in the Articles of Incorporation.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their duly authorized officers, as of the day and year first
above written.
AS APPENDED BY SCHEDULE Al
PRINCIPAL PRESERVATION PORTFOLIOS
By:--------------------------------
Title:--------------------------------
FIRST DATA INVESTOR SERVICES GROUP, INC.
By: --------------------------------
Title: --------------------------------
SCHEDULE A
LIST OF PORTFOLIOS
CASH RESERVE - CLASS X RETAIL SALES
CLASS Y INSTITUTIONAL SHARES
S&P 100 PLUS PORTFOLIO
DIVIDEND ACHIEVERS PORTFOLIO
PSE TECH 100 INDEX PORTFOLIO
SELECT VALUE PORTFOLIO
MANAGED GROWTH PORTFOLIO
GOVERNMENT PORTFOLIO
TAXEXEMPT PORTFOLIO
WISCONSIN TAXEXEMPT PORTFOLIO
SCHEDULE B
DUTIES OF INVESTOR SERVICES GROUP
1. Shareholder Information. Investor Services Group shall maintain
a record of the number of Shares held by each Shareholder of record which
shall include name, address, taxpayer identification and which shall
indicate whether such Shares are held in certificates or uncertificated
form.
2. Shareholder Services. Investor Services Group shall respond as
appropriate to all inquiries and communications from Shareholders relating
to Shareholder accounts with respect to its duties hereunder and as may be
from time to time mutually agreed upon between Investor Services Group and
the Fund.
3. Share Certificates.
a) At the expense of the Fund, the Fund shall supply Investor
Services Group with an adequate supply of blank share certificates to meet
Investor Services Group requirements therefor. Such Share certificates
shall be properly signed by facsimile. The Fund agrees that,
notwithstanding the death, resignation, or removal of any officer of the
Fund whose signature appears on such certificates, Investor Services Group
or its agent may continue to countersign certificates which bear such
signatures until otherwise directed by Written Instructions.
b) Investor Services Group shall issue replacement Share
certificates in lieu of certificates which have been lost, stolen or
destroyed, upon receipt by Investor Services Group of properly executed
affidavits and lost certificate bonds, in form satisfactory to Investor
Services Group, with the Fund and Investor Services Group as obligees under
the bond.
c) Investor Services Group shall also maintain a record of each
certificate issued, the number of Shares represented thereby and the
Shareholder of record. With respect to Shares held in open accounts or
uncertificated form (i.e., no certificate being issued with respect
thereto) Investor Services Group shall maintain comparable records of the
Shareholders thereof, including their names, addresses and taxpayer
identification. Investor Services Group shall further maintain a stop
transfer record on lost and/or replaced certificates.
4. Mailing Communications to Shareholders; Proxy Materials.
Investor Services Group will address and mail to Shareholders of the Fund,
all reports to Shareholders, dividend and distribution notices and proxy
material for the Fund's meetings of Shareholders. In connection with
meetings of Shareholders, Investor Services Group will prepare Shareholder
lists, mail and certify as to the mailing of proxy materials, process and
tabulate returned proxy cards, report on proxies voted prior to meetings,
act as inspector of election at meetings and certify Shares voted at
meetings.
5. Sales of Shares.
a) Investor Services Group shall not be required to issue any
Shares of the Fund where it has received a Written Instruction from the
Fund or official notice from any appropriate authority that the sale of the
Shares of the Fund has been suspended or discontinued. The existence of
such Written Instructions or such official notice shall be conclusive
evidence of the right of Investor Services Group to rely on such Written
Instructions or official notice.
b) In the event that any check or other order for the payment
of money is returned unpaid for any reason, Investor Services Group will
endeavor to: (i) give prompt notice of such return to the Fund or its
designee; (ii) place a stop transfer order against all Shares issued as a
result of such check or order; and (iii) take such actions as Investor
Services Group may from time to time deem appropriate.
6. Transfer and Repurchase.
a) Investor Services Group shall process all requests to
transfer or redeem Shares in accordance with the transfer or repurchase
procedures set forth in the Fund's Prospectus.
b) Investor Services Group will transfer or repurchase Shares
upon receipt of Oral or Written Instructions or otherwise pursuant to the
Prospectus and Share certificates, if any, properly endorsed for transfer
or redemption, accompanied by such documents as Investor Services Group
reasonably may deem necessary.
c) Investor Services Group reserves the right to refuse to
transfer or repurchase Shares until it is satisfied that the endorsement on
the instructions is valid and genuine. Investor Services Group also
reserves the right to refuse to transfer or repurchase Shares until it is
satisfied that the requested transfer or repurchase is legally authorized,
and it shall incur no liability for the refusal, in good faith, to make
transfers or repurchases which Investor Services Group, in its good
judgment, deems improper or unauthorized, or until it is reasonably
satisfied that there is no basis to any claims adverse to such transfer or
repurchase.
d) When Shares are redeemed, Investor Services Group shall,
upon receipt of the instructions and documents in proper form, deliver to
the Custodian and the Fund or its designee a notification setting forth the
number of Shares to be repurchased. Such repurchased shares shall be
reflected on appropriate accounts maintained by Investor Services Group
reflecting outstanding Shares of the Fund and Shares attributed to
individual accounts.
e) Investor Services Group shall upon receipt of the monies
provided to it by the Custodian for the repurchase of Shares, pay such
monies as are received from the Custodian, all in accordance with the
procedures described in the written instruction received by Investor
Services Group from the Fund.
f) Investor Services Group shall not process or effect any
repurchase with respect to Shares of the Fund after receipt by Investor
Services Group or its agent of notification of the suspension of the
determination of the net asset value of the Fund.
7. Dividends.
a) Upon the declaration of each dividend and each capital gains
distribution by the Board of Directors of the Fund with respect to Shares
of the Fund, the Fund shall furnish or cause to be furnished to Investor
Services Group Written Instructions setting forth the date of the
declaration of such dividend or distribution, the exdividend date, the date
of payment thereof, the record date as of which Shareholders entitled to
payment shall be determined, the amount payable per Share to the
Shareholders of record as of that date, the total amount payable on the
payment date and whether such dividend or distribution is to be paid in
Shares at net asset value.
b) On or before the payment date specified in such resolution
of the Board of Directors, the Fund will provide Investor Services Group
with sufficient cash to make payment to the Shareholders of record as of
such payment date.
c) If Investor Services Group does not receive sufficient cash
from the Fund to make total dividend and/or distribution payments to all
Shareholders of the Fund as of the record date, Investor Services Group
will, upon notifying the Fund, withhold payment to all Shareholders of
record as of the record date until sufficient cash is provided to Investor
Services Group.
8. Retirement Plans. In connection with the individual retirement
account, simplified employee pension plan, rollover individual retirement
plan, educational XXX and XXXX individual retirement account (each
hereinafter referred to as an "XXX" and, collectively, the "IRAs") within
the meaning of Section 408 of the Internal Revenue Code of 1986, as amended
(the "Code") offered by the Fund for which contributions of the Funds'
shareholders (the "Participants") in the IRA's are invested in shares of
the Fund, Investor Services Group shall provide the following
administrative services in addition to those services described herein:
a) Establish a record of types and reasons for distributions
(i.e., attainment of age 59-1/2, disability, death, return of excess
contributions, etc.);
b) Record method of distribution requested and/or made;
c) Receive and process designation of the beneficiary forms;
d) Examine and process requests for direct transfers between
custodians/trustees, transfer and pay over to the successor assets in the
account and records pertaining thereto as requested;
e) Prepare any annual reports or returns required to be
prepared and/or filed by a custodian of an XXX, including, but not limited
to, an annual fair market value report, Forms 1099R and 5498 and file with
the IRS and provide to Participant/Beneficiary; and
f) Perform applicable federal withholding and send
Participants/Beneficiaries an annual TEFRA notice regarding required
federal tax withholding.
9. Cash Management Services. Funds received by Investor Services
Group in the course of performing its services hereunder will be held in
bank accounts and/or money market fund accounts. With respect to funds
maintained in money market fund accounts, Investor Services Group shall
retain any interest generated or earned. With respect to funds maintained
in bank accounts, Investor Services Group shall retain any excess balance
credits or excess benefits earned or generated by or associated with such
bank accounts or made available by the institution at which such bank
accounts are maintained after such balance credits or benefits are first
applied towards banking service fees charged by such institution in
connection with banking services provided on behalf of the Fund.
10. Lost Shareholders. Investor Services Group shall perform such
services as are required in order to comply with Rules 17a24 and 17Ad17 of
the 34 Act (the Lost Shareholder Rules"), including, but not limited to
those set forth below. Investor Services Group may, in its sole discretion,
use the services of a third party to perform the some or all such services.
a) documentation of electronic search policies and procedures;
b) execution of required searches;
c) creation and mailing of confirmation letters;
d) taking receipt of returned verification forms;
e) providing confirmed address corrections in batch via
electronic media;;
f) tracking results and maintaining data sufficient to comply
with the Lost Shareholder Rules; and
g) preparation and submission of data required under the Lost
Shareholder Rules.
SCHEDULE C
FEE SCHEDULE
1. Standard Fees. Three Years
$19.50 per fixed income/daily
$17.50 per equity
all accounts over 100,000 @ $1500 per
annum
Early termination penalty:
02 years 1 years fee
23 years $250,000
2. Lost Shareholder Search/Reporting: $2.75 per account search*
*The per account search fee shall be waived until June 2000 so
long as the Fund retains Xxxxx Tracers, Inc. ("KTI") to provide the Fund
with KTI's "InDepth Research Program" services.
3. Print/Mail Fees.
a) Standard Pricing:
Implementation Fee: $5000.00
Testing Application or Data Requirements: $3.00/fax
Work Order: $15.00 per workorder
Daily Work (Confirms):
Hand: $71/K with $75.00 minimum (includes BRE or CRE)
$0.07/each additional insert
Machine: $42/K with $50.00 minimum (includes BRE or CRE)
$0.01/each additional insert
Daily Checks*:
Hand: $91/K with $100.00 minimum daily (includes 1
insert)
$0.08/each additional insert
Machine: $52/K with $75.00 minimum (includes 1 insert)
$0.01/each additional insert
* There is a $3.00 charge for each 3606 Form sent.
Statements:
Hand: $78/K with $75.00 minimum (includes BRE or CRE)
$0.08/each additional insert
$125/K for intelligent inserting
Machine: $52/K with $75.00 minimum (includes BRE or CRE)
$0.01 each additional insert
$58/K for intelligent inserting
Periodic Checks:
Hand: $91/K with $100.00 minimum (includes 1 insert)
$0.08/each additional insert
Machine: $52/K with $100.00 minimum (includes 1 insert)
$0.01/each additional insert
12B1/Dealer Commission Checks/Statements: $0.78/each envelope with
$100.00 minimum
Spac Reports/Group Statements: $78/K with $75.00 minimum
Listbills: $0.79 per envelope with $75.00 minimum
Printing Charges: (price ranges dependent on volumes)
$0.08/per confirm/statement/page
$0.10/per check
Folding (Machine): $18/K
Folding (Hand): $.12 each
Presort Charge: postage rate
$0.035 per piece
Courier Charge: $15.00 for each on call courier trip/or
actual cost for on demand
Overnight Charge: $3.50 per package service charge plus Federal
Express/Airborne charge
Inventory Storage: $20.00 for each inventory location as of the
15th of the month
Inventory Receipt: $20.00 for each SKU/Shipment
Hourly work, special projects, opening envelopes, etc. $24.00 per hour
Special Pulls: $2.50 per account pull
Boxes/Envelopes: Shipping boxes $0.85 each
Oversized Envelopes $0.45 each
Forms Development/Programming Fee: $100/hr
Systems Testing: $85/hr
Cutting Charges: $10.00/K
b) Special Mailings:
Special mailing pricing is based on appropriate notification
(standard of 30 day notification) and scheduling for special
mailings. Scheduling requirements include having collateral
arrive at agreed upon times in advance of deadlines. Mailings
which arise with shorter time frames and turns will be billed at
a premium based on turn around requirements.
Work Order: $15.00 per Workorder
Daily Work (Confirms):
Hand: $135.00 to create an admark tape
$10.00/K to zip + 4 data enhance/$12500 minimum
$80.00/hr for any data manipulation
$10.00/K combo charge
Admark & Machine Insert
#10,#11,6x9: $62/K to admark envelope and machine insert 1
piece/$125.00 min
$2.50/K for each additional insert
$38/K to admark only with $75.00 minimum
$25.00/X xxxx sort
9xl2: $135/K to admark envelope and machine insert 1
piece/$125.00 min
$5.00/K for each additional insert
$38/K to admark only/$75.00 minimum
$0.08 for each hand insert
Admark & Hand Insert:
#10,#11,6x9: $0.08 for each hand insert
$25.00/X xxxx sort
9xl2: $0.09 for each hand insert
$35.00/X xxxx sort
Pressure/Sensitive Labels:
$0.32 each to create, affix and hand insert 1 piece/$75.00 minimum
$0.08 for each hand insert
$0.10 to affix 1 labels only
$0.10 to create labels only
Legal Drop: $150.00/compliant legal drop per job and
processing fees
Create Mailing List: $0.40 per entry with $75.00 minimum
Presort Fee: $0.035 per piece
4. Miscellaneous Charges. The Fund shall be charged for the
following products and services as applicable:
o Ad hoc reports
o Ad hoc SQL time
o COLD Storage
o Digital Recording
o Microfiche/microfilm production
o Magnetic media tapes and freight
o Pre-Printed Stock, including business forms, certificates,
envelopes, checks and stationary
5. Fee Adjustments. After the one year anniversary of the effective
date of this Agreement, Investor Services Group may adjust the fees
described in the above sections once per calendar year, upon thirty (30)
days prior written notice in an amount not to exceed the cumulative
percentage increase in the Consumer Price Index for All Urban Consumers
(CPIU) U.S. City Average, All items (unadjusted) (198284=100), published
by the U.S. Department of Labor since the last such adjustment in the
Client's monthly fees (or the Effective Date absent a prior such
adjustment).
6. Programming Costs. The following programming rates are subject
to an annual 5% increase after the one year anniversary of the effective
date of this Agreement.
a) Dedicated Team: Programmer: $100,000 per annum
BSA: $ 85,000 per annum
Tester: $ 65,000 per annum
b) System Enhancements (Non Dedicated Team): $150.00 per/hr
per programmer
SCHEDULE D
OUT-OF-POCKET EXPENSES
1. Out of Pocket Expenses. The Fund shall reimburse Investor
Services Group monthly for applicable outofpocket expenses, including, but
not limited to the following items:
o Postage direct pass through to the Fund
o Telephone and telecommunication costs, including all lease,
maintenance and line costs
o Proxy solicitations, mailings and tabulations
o Shipping, Certified and Overnight mail and insurance
o Terminals, communication lines, printers and other equipment and
any expenses incurred in connection with such terminals and lines
o Duplicating services
o Banking Services
o Distribution and Redemption Check Issuance
o Courier services
o Federal Reserve charges for check clearance
o Overtime, as approved by the Fund
o Temporary staff, as approved by the Fund
o Travel and entertainment, as approved by the Fund
o Record retention, retrieval and destruction costs, including, but
not limited to exit fees charged by third party record keeping vendors
o Third party audit reviews
o Insurance
The Fund agrees that postage and mailing expenses will be paid on the
day of or prior to mailing as agreed with Investor Services Group. In
addition, the Fund will promptly reimburse Investor Services Group for any
other unscheduled expenses incurred by Investor Services Group whenever the
Fund and Investor Services Group mutually agree that such expenses are not
otherwise properly borne by Investor Services Group as part of its duties
and obligations under the Agreement.
SCHEDULE E
FUND DOCUMENTS
o Certified copy of the Articles of Incorporation of the Fund, as
amended
o Certified copy of the Bylaws of the Fund, as amended,
o Copy of the resolution of the Board of Directors authorizing the
execution and delivery of this Agreement
o Specimens of the certificates for Shares of the Fund, if
applicable, in the form approved by the Board of Directors of the Fund,
with a certificate of the Secretary of the Fund as to such approval
o All account application forms and other documents relating to
Shareholder accounts or to any plan, program or service offered by the Fund
o Certified list of Shareholders of the Fund with the name, address
and taxpayer identification number of each Shareholder, and the number of
Shares of the Fund held by each, certificate numbers and denominations (if
any certificates have been issued), lists of any accounts against which
stop transfer orders have been placed, together with the reasons therefore,
and the number of Shares redeemed by the Fund
o All notices issued by the Fund with respect to the Shares in
accordance with and pursuant to the Articles of Incorporation or Bylaws of
the Fund or as required by law and shall perform such other specific duties
as are set forth in the Articles of Incorporation including the giving of
notice of any special or annual meetings of shareholders and any other
notices required thereby.
SCHEDULE AI
Additional Requirements Pursuant to Request for Proposal:
1. All conversion costs relating to the Principal Preservation
Portfolio accounts moving from the SuRPAS to a different First Data
Transfer Agent system in the year 2000 or after will be borne by First Data
Corporation.
2. If requested by First Data, Principal Preservation Portfolios and
the staff of X. X. Xxxxxxx and Company agree to do Print Mail functions for
the funds until the conversion to the different Transfer Agent system is
consummated. The files produced by First Data from SuRPAS must be made
available to Principal Preservation Portfolio with the current formatting.
3. Principal Preservation Portfolios will have up to eight links
into the SuRPAS system through SuRPAS desktop or classic SuRPAS without any
licensing or "seat" charges.
4. The UDMS reporting functionality will be made available to
Principal Preservation Portfolio at no initial charge. However, Principal
Preservation Portfolios will be responsible for a prorata annual
maintenance fee for the product not to exceed $2,000.
5. First Data represents that transaction download capabilities
currently completed with the "Dazzle" product, will be made available
through SuRPAS within 30 days of conversion.
6. Principal Preservation Portfolios agrees to work with First Data
to complete data transmission activities involving Pershing. If requested
by First Data, Principal Preservation Portfolios will continue to send the
daily rate transmission to Pershing and receive the daily transaction file
from Pershing and communicate it to First Data. However, First Data will
be responsible for sending to Pershing the end of day and monthly
transmission files generated from the DLRDAYBAL SuRPAS event.
7. Finally, if the standards as attached on Schedule F are not met,
the following will occur.
a) The first quarter that a standard is missed, notice is
given.
b) In any two quarters of a rolling six quarters where the same
standard is missed, a 10% reduction in the second quarter of under
performance will ensue (the 10% reduction is in Transfer Agent fee).
c) In any three quarters of a rolling six quarter period where
the same standard has been missed, a 20% reduction in the quarterly
transfer agent will ensue.
d) Failure by First Data to provide the "Dazzle" product as
mentioned in item 5 or the Pershing file in item 6, will be considered a
missed standard.
First Data Corporation and Principal Preservation Portfolios, Inc.
agree to the appended items to the Transfer Agent contract as evidenced by
the signatures of the duly authorized officers of each corporation on the
date listed below.
Principal Preservation Portfolios, Inc. First Data Corporation
Signature:---------------------- Signature: ----------------------
Title: ------------------------ Title: ------------------------
Dated this --- day of July, 1999 Dated this --- day of July,
1999
Witnessed By:
---------------------- ----------------------
Title: ---------------------- Title: ----------------------
SCHEDULE F
TRANSFER AGENCY SERVICES
Category Components (to be reported individually
Financials Purchases, Redemptions, Exchanges, Adjustments
(both financial and nonfinancial adjustments)
Minimum Quality Score: 99%
NonFinancials Maintenance (including address changes, option
changes,
ROA/LOI), Legal Transfers, New Accounts
Minimum Quality Score: 98%
Print Mail Statements, Confirms, Checks
Minimum Acceptable Quality Score: 98%
Shareholder
Service Telephones, Correspondence
Minimum Acceptable Quality Score: 98%
Completion Standards
Transaction Processing
A. Complete on day of receipt:
o Purchases, redemptions, exchanges, financial adjustments,
new accounts
B. Complete within three days or receipt:
o Non-financial adjustments, legal transfers
C. Complete within 5 days of receipt
o Maintenance
D. 100% Same Day Quality Control of Financial Items
Print Mail*
A. Mailed on day of receipt
o Shareholder checks
B. Mailed within one day of receipt
o Confirms
C. Mailed within five business days following the end of the
reporting period
o Statements, Commission checks
* Note that Print Mail performance standards will be in effect
only for those mailings, where services are provided by Investor
Services Group
* Note that Print Mail performance standards will be in effect
only for those mailings where services are provided by Investor
Services Group
Shareholder Services
A. Telephone calls abandoned no greater than 3% of calls received
(excluding calls that abandon in less than 20 seconds)
B. Financial correspondence mailed within two days of receipt
C. Non-financial correspondence mailed within five days of receipt
D. Average speed of answer less than 20 seconds
