THE LIPPER FUNDS, INC.
GROUP RETIREMENT SERVICING PLAN
1. The Lipper Funds, Inc. (the "Company") is hereby authorized to enter
into written agreements in substantially the form attached hereto as Exhibit I
or in any other form duly approved by the Board of Directors (the Shareholder
Servicing Agreement") with institutional shareholders of record or other
financial institutions ("Shareholder Servicing Agents"). A Shareholder Servicing
Agreement shall require the Shareholder Servicing Agent to provide support
services on behalf of the Company as set forth therein to its customers (the
Customers") who beneficially own shares (the "Shares") in any of the company's
investment portfolios (the "Funds"). For such services, the Shareholder
Servicing Agent shall receive a fee, computed daily and paid monthly from the
assets of each Fund in the manner set forth in the Shareholder Servicing
Agreement, at an annual rate of up to [ ] of 1% of the average daily net asset
value of Shares in such Fund with respect to which the Shareholder Servicing
Agent provides services for its Customers.
2. Each Shareholder Servicing Agreement which varies substantially from the
form attached hereto as Exhibit I or which is proposed to be entered into with a
Shareholder Servicing Agent which is the investment adviser or principal
underwriter of the Company, or an "affiliate," as defined in the Investment
Company Act of 1940, as amended (the "1940 Act"), of the Company, its investment
adviser or its principal underwriter, shall be approved by the Board of
Directors and by a vote of a majority of the Directors who are not "interested
persons" of the Company, as defined in the 1940 Act, and who have no financial
interest, direct or indirect, in such Shareholder Servicing Agreement. Each
Shareholder Servicing Agreement which does not vary substantially from the form
attached hereto as Exhibit I and which is not proposed to be entered into with
the investment adviser or principal underwriter of the Company, or any
"affiliate," as defined in the 1940 Act, of the Company, its investment adviser
or its principal underwriter, may be entered into, executed and delivered in the
name and on behalf of the Company, by the President or any Vice President of the
Company, at a fee determined in accordance with paragraph 1 above by the officer
executing such Agreement.
3. This plan (the "Plan"), shall become effective upon the approval of the
Plan (and the form of Shareholder Servicing Agreement attached hereto) by the
Board of Directors and by the vote of the majority of the Directors who are not
"interested persons" of the Company, as defined in the 1940 Act and who have no
financial interest, direct or indirect, in the Plan or in any Shareholder
Servicing Agreement or other agreement relating to the Plan (the "Disinterested
Directors").
4. The Plan may be amended at any time by the Board of Directors including
the vote of a majority of the Disinterested Directors, without the consent of
any Shareholder
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Servicing Agent; provided, however, that any such amendment shall not, without
the consent of the affected Shareholder Servicing Agent, modify the terms of any
Shareholder Servicing Agent, modify the terms of any Shareholder Servicing
Agreement to which the company is a party.
5. The Plan may be terminated at any time, without the payment of any
penalty, by a vote of a majority of the Company's entire Board of Directors on
sixty (60) days', written notice to any Shareholder Servicing Agents which are
parties to any Shareholder Servicing Agreements with the Company. Any notice of
termination of the Plan shall be deemed to also constitute a notice of
termination of the Plan shall be deemed to also constitute a notice of
termination of the Shareholder Servicing Agreement between the Company and any
Shareholder Servicing Agent to which such notice of termination is delivered.
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SHAREHOLDER SERVICING AGREEMENT
SHAREHOLDER SERVICING AGREEMENT, dated as of December , 1995, by and
between The Lipper Funds, Inc. (the Company"), a Maryland corporation, and [ ]
(the "Financial Institution"), as a shareholder servicing agent hereunder (the
"Agent") relating to transactions in shares of capital stock, $.001 par value
(the "Shares"), of any of the three existing investment portfolios offered by
the Company (the "Funds"). In the event that the Company establishes one or more
portfolios other than the Funds with respect to which it decides to retain the
Financial Institution hereunder, the Company shall promptly notify the Financial
Institution in writing. If the Financial Institution is willing to render such
services, it shall notify the Company in writing whereupon such portfolio shall
become a Fund hereunder.
The Company and the Financial Institution hereby agree as follows:
1. Appointment. The Financial Institution, as Agent, hereby agrees to
perform certain services for its customers (the "Customers") as hereinafter set
forth. The Agent's appointment hereunder is non-exclusive, and the parties
recognize and agree that, from time to time, the Company may enter into other
shareholder servicing agreements, in writing, with other financial institutions.
2. Services to be Performed. The Agent, as agent for its Customers, shall
be responsible for performing shareholder administrative support services, which
will include the following: (i) answering customer inquiries regarding account
status and history, the manner in which purchases, exchanges and redemptions of
shares of the Funds may be effected and certain other matters pertaining to the
Funds; (ii) assisting shareholders in designating and changing dividend options,
account designations and addresses; (iii) providing necessary personnel and
facilities to establish and maintain shareholder accounts and records; (iv)
assisting in aggregating and processing purchase, exchange and redemption
transactions; (v) placing net purchase and redemption orders with the Company's
distributor; (vi) arranging for wiring of funds; (vii) transmitting and
receiving funds in connection with customer orders to purchase or redeem shares;
(viii) processing dividend payments; (ix) verifying and guaranteeing shareholder
signatures in connection with redemption orders and transfers and changes in
shareholder-designated accounts, as necessary; (x) providing periodic statements
showing a customer's account balance and, to the extent practicable, integrating
such information with other customer transactions otherwise effected through or
with the Shareholder Servicing Agent; (xi) furnishing (either separately or on
an integrated basis with other reports sent to a shareholder by a Shareholder
Servicing Agent) monthly and year-end statement and confirmations of purchases,
exchanges and redemptions; (xii) transmitting on behalf of the Company, proxy
statements, annual reports, updating prospectuses and other communications from
the Company to the shareholders of the Funds; (xiii) receiving, tabulating and
transmitting to the Company proxies executed by shareholders with respect to
meetings of shareholders of the
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Funds; and (xiv) providing such other related services as the Company as the
Company or a shareholder may request.
The Agent shall provide all personnel and facilities necessary in order for
it to perform the functions described in this paragraph with respect to its
Customers.
3. Fees.
3.1. Fees from the Company. In consideration for the services described in
Section 2 hereof and the incurring of expenses in connection therewith, the
Agent shall receive a fee, computed daily and payable monthly, at the annual
rate of _ of 1% of the average daily net asset value of Shares of each Fund for
which the Agent from time to time performs services under this Agreement on
behalf of Customers. Fees with respect to Customers' Shares in any one Fund will
be paid exclusively from the assets of that Fund in which such Customer's assets
are invested. For purposes of determining the fees payable to the Agent
hereunder, the value of the Company's net assets shall be computed in the manner
specified in the Company's then-current prospectus and statement of additional
information (the "Prospectus") for computation of the net asset value of the
Company's Shares.
3.2. Fees from Customers. It is agreed that the Financial Institution may
impose certain conditions on Customers, in addition to or different from those
imposed by the Company, such as requiring a minimum initial investment or
imposing limitations on the amounts of transactions. It is also understood that
the Financial Institution may directly credit or charge fees to Customers in
connection with an investment in the Funds. The Financial Institution shall
credit or bill Customers directly for such credits or fees. In the event the
Financial Institution charges Customers such fees, it shall make appropriate
prior written disclosure (such disclosure to be in accordance with all
applicable laws) to Customers both of any direct fees charged to the Customer
and of the fees received or to be received by it from the Company pursuant to
Section 3.1 of this Agreement. It is understood however, that in no event shall
the Financial Institution have recourse or access as Agent or otherwise to the
account of any shareholder of the Company except to the extent expressly
authorized by law or by such shareholder, or to any assets of the Company, for
payment of any direct fees referred to in this Section 3.2.
4. Approval of Materials to be Circulated. Advance copies or proofs of all
materials which are to be generally circulated or disseminated by the Agent to
Customers or prospective Customers which identify or describe the Company shall
be provided to the Company at least 10 days prior to such circulation or
dissemination (unless the Company consents in writing to a shorter period), and
such materials shall not be circulated or disseminated or further circulated or
disseminated at any time after the Company shall have given written notice to
the Agent of any objection thereto.
Nothing in this Section 4 shall be construed to make the Company liable for
the use of any information about the Company which is disseminated by the Agent.
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5. Compliance with Laws, etc. The Agent shall comply with all applicable
federal and state laws and regulations in the performance of its duties under
this Agreement, including securities laws.
6. Limitation of Agent's Liability. In consideration of the Agent's
undertaking to render the services described in this Agreement, the Company
agrees that the Agent shall not be liable under this Agreement for any error of
judgment or mistake of law or for any loss suffered by the Company in connection
with the performance of this Agreement, provided that nothing in this Agreement
shall be deemed to protect or purport to protect the Agent against any liability
to the Company or its stockholders to which the Agent would otherwise be subject
by reason of willful misfeasance, bad faith or gross negligence in the
performance of the Agent's duties under this Agreement or by reason of the
Agent's reckless disregard of its obligations and duties hereunder.
7. Indemnification. The Company agrees to indemnify and hold harmless the
Agent from all taxes, charges, expenses, assessments, claims and liabilities
(including, without limitation, liabilities arising under the Securities Act of
1933, as amended, the Securities Exchange Act of 1934, as amended, the
Investment Company Act of 1940, as amended, and any state and foreign securities
and blue sky laws, all as or to be amended from time to time) and expenses,
including attorneys' fees and disbursements arising directly or indirectly from
(i) any misstatements or omissions in the Company's Prospectus, or (ii) any
action or thing which the Agent takes or does or omits to take or do reasonably
believed by the Agent to be at the request or direction or in reliance on the
advice or instructions, whether oral or written, of the Company provided, that
the Agent shall not be indemnified against any liability to the Company or to
its shareholders (or any expenses incident to such liability) arising out of the
Agent's own willful misfeasance, bad faith or gross negligence in the
performance of its duties hereunder or by reason of its reckless disregard of
its obligations and duties hereunder. In order that the indemnification
provision contained in this paragraph shall apply, it is understood that if in
any case the Company may be asked to indemnify or save the Agent harmless, the
Company shall be fully and promptly advised of all pertinent facts concerning
the situation in question, and it is further understood that the Agent will use
all reasonable care to identify and notify the Company promptly concerning any
situation which presents or appears likely to present the probability of such a
claim for indemnification against the Company. The Company shall have the option
to defend the Agent against any claim which may be the subject of this
indemnification and, in the event that the Company so elects, it will so notify
the Agent and thereupon the Company shall take over complete defense for the
claim, and the Agent shall in such situation incur no further legal or other
expenses for which it shall seek indemnification under this paragraph. The Agent
shall in no case confess any claim or make any compromise or settlement in any
case in which the Company will be asked to indemnify the Agent, except with
Company's prior written consent.
8. Limitation of Shareholder Liability, etc. The Agent xxxxxx agrees that
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obligations assumed by the Company pursuant to this Agreement shall be limited
in all cases to the Company and its assets and that the Agent shall not seek
satisfaction of any such obligation from the shareholders or any shareholder of
the Company. It is further agreed that the Agent shall not seek satisfaction of
any such obligations from the Board of Directors or any individual Director of
the Company.
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9. Notices. All notices or other communications hereunder to either party
shall be in writing or by confirming telegram, cable, telex or facsimile sending
device. Notices shall be addressed (a) if to the Company, at the address of the
Company, or (b) if to the Agent, at _______________________________.
10. Further Assurances. Each party agrees to perform such further acts and
execute such further documents as are necessary to effectuate the purposes
hereof.
11. Termination. This Agreement will continue in effect until two years
from the date hereof and thereafter for successive annual periods, provided that
such continuance is specifically approved at least annually (a) by the Company's
Board of Directors and (b) by the vote, cast in person at a meeting called for
the purpose, of a majority of the Company's directors who are not parties to
this Agreement or "interested persons" (as defined in the 1940 Act) of any such
party. This Agreement may be terminated at any time, without the payment of any
penalty, by a vote of a majority of the Company's outstanding voting securities
(as defined in the 1940 Act) or by a vote of a majority of the Company's entire
Board of Directors on 60 days', written notice to the Agent or by the Agent on
(60) days', written notice to the Company. Notice of termination of the
Shareholder Servicing Plan by the Board of Directors, pursuant to which this
Agreement has been entered, shall constitute a notice of termination of this
Agreement.
12. Changes: Amendments. This Agreement may be changed or amended only by
written instrument signed by both parties.
13. Reports. The Agent will provide the Company or its designees such
information as the Company or its designees may reasonably request (including,
without limitation, periodic certifications confirming the provision to
Customers of the services described herein), and will otherwise cooperate with
the Company and its designees (including, without limitation, any auditors
designated by the Company), in connection with the preparation of reports to its
Board of Directors concerning this Agreement and the monies paid or payable
under this Agreement, as well as any other reports or filings that may be
required by law.
14. Subcontracting by Agent. The Agent may subcontract for the performance
of the Agent's obligations hereunder with any one or more persons, including but
not limited to any one or more persons which is an affiliate of the Agent;
provided, however, that the Agent shall be as fully responsible to the Company
for the acts and omissions of any subcontractor as it would be for its own acts
or omissions. The Agent shall notify the Company of any such arrangements no
later than the next meeting of the Company's Board of Directors following the
entry by the Agent into such arrangements. Notwithstanding this paragraph or
paragraph 11 of this Agreement, the Company reserves the right to terminate this
Agreement immediately or upon such notice as the Company, in its sole
discretion, determines to give, and without payment of any penalty, if the
Company notifies the Agent that any subcontractor of the Agent is
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unacceptable to the Company for any reason and the Agent does not terminate its
arrangements with such subcontractor as promptly as reasonably practicable.
15. Governing Law. This Agreement shall be governed by the laws of the
State of New York.
16. Miscellaneous. The captions in 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. This
Agreement has been executed on behalf of the Company by the undersigned not
individually, but in the capacity indicated.
THE LIPPER FUNDS, INC.
By:
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Title:
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