TRANSFER AGENT SERVICING AGREEMENT
THIS
AGREEMENT is made and entered into as of this ___ day of _____, 2005, by and
between GREENSPRING
FUND, INC.,
a
Maryland corporation (the “Fund”) and U.S.
BANCORP FUND SERVICES, LLC,
a
Wisconsin limited liability company (“USBFS”).
WHEREAS,
the Fund is registered under the Investment Company Act of 1940, as amended
(the
“1940 Act”), as an open-end management investment company, and is authorized to
issue shares of common stock;
WHEREAS,
USBFS is, among other things, in the business of administering transfer and
dividend disbursing agent functions for the benefit of its customers;
and
WHEREAS,
the Fund desires to retain USBFS to provide transfer and dividend disbursing
agent services to the Fund.
NOW,
THEREFORE, in consideration of the promises and mutual covenants herein
contained, and other good and valuable consideration, the receipt of which
is
hereby acknowledged, the parties hereto, intending to be legally bound, do
hereby agree as follows:
| 1. |
Appointment
of USBFS as Transfer Agent
|
The
Fund
hereby appoints USBFS as transfer agent of the Fund on the terms and conditions
set forth in this Agreement, and USBFS hereby accepts such appointment and
agrees to perform the services and duties set forth in this Agreement. The
services and duties of USBFS shall be confined to those matters expressly set
forth herein, and no implied duties are assumed by or may be asserted against
USBFS hereunder. If the Fund shall establish any additional series of its common
stock and shall elect to appoint USBFS to act as transfer agent for one or
more
such series, USBFS shall perform the services and duties set forth in this
Agreement with respect to such series upon execution of an amendment to this
Agreement by the Fund and USBFS in order to add such series.
| 2. |
Services
and Duties of USBFS
|
USBFS
shall provide the following transfer agent and dividend disbursing agent
services to the Fund:
| A. |
Receive
and process all orders for the purchase and/or redemption of shares
in
accordance with Rule 22c-1 under the 1940
Act.
|
| B. |
Process
purchase orders with prompt delivery, where appropriate, of payment
and
supporting documentation to the Fund’s custodian, and issue the
appropriate number of uncertificated shares with such uncertificated
shares being held in the appropriate shareholder
account.
|
| C. |
Arrange
for the issuance of shares obtained through transfers of funds from
Fund
shareholders’ accounts at financial
institutions.
|
| D. |
Process
redemption requests received in good order and, where relevant, deliver
appropriate documentation to the Fund’s
custodian.
|
| E. |
Pay
monies upon receipt from the Fund’s custodian, where relevant, in
accordance with the instructions of redeeming
shareholders.
|
| F. |
Process
transfers of shares in accordance with the shareholder’s instructions,
after receipt of appropriate documentation from the shareholder as
specified in the Fund’s prospectus
(“Prospectus”).
|
| G. |
Calculate
and pay redemption fees in accordance with the Fund’s registration
statement.
|
| H. |
Prepare
and transmit payments for dividends and distributions declared by the
Fund, after deducting any amount required to be withheld by any applicable
laws, rules and regulations and in accordance with shareholder
instructions.
|
| I. |
Serve
as the Fund’s agent in connection with accumulation, open account or
similar plans (e.g., periodic investment plans and periodic withdrawal
plans).
|
| J. |
Make
changes to shareholder records, including, but not limited to, address
changes in plans (e.g., systematic withdrawal, automatic investment,
dividend reinvestment).
|
| K. |
Handle
load and multi-class processing, including rights of accumulation and
purchases by letters of intent.
|
| L. |
Record
the issuance of shares of the Fund and maintain, pursuant to Rule
17Ad-10(e) promulgated under the Securities Exchange Act of 1934, as
amended (the “Exchange Act”), a record of the total number of shares of
the Fund which are authorized, issued and
outstanding.
|
| M. |
Prepare
shareholder meeting lists and, as necessary, mail, receive and tabulate
proxies.
|
| N. |
Mail
shareholder reports and Prospectuses to current
shareholders.
|
| O. |
Prepare
and file U.S. Treasury Department Forms 1099 and other appropriate
information returns required with respect to dividends and distributions
for all shareholders.
|
| P. |
Provide
shareholder account information upon request and prepare and mail
confirmations and statements of account to shareholders for all purchases,
redemptions and other confirmable transactions as agreed upon with
the
Fund.
|
| Q. |
Mail
requests for shareholders’ certifications under penalties of perjury and
pay on a timely basis to the appropriate federal authorities any taxes
to
be withheld on dividends and distributions paid by the Fund, all as
required by applicable federal tax laws and
regulations.
|
| R. |
Provide
a Blue Sky system that will enable the Fund to monitor the total number
of
shares of the Fund sold in each state; provided that the Fund, not
USBFS,
is responsible for ensuring that shares are not sold in violation of
any
requirement under the securities laws or regulations of any
state.
|
| S. |
Answer
correspondence from shareholders, securities brokers and others relating
to USBFS’s duties hereunder.
|
| T. |
Reimburse
the Fund each month for all material losses resulting from “as of”
processing errors for which USBFS is responsible in accordance with
the
“as of” processing guidelines set forth on Exhibit
A
hereto.
|
| U. |
Assist
and cooperate with the Fund’s Chief Compliance Officer (“CCO”) in
monitoring shareholder activity to ensure compliance with the Fund’s
policy on prevention of market timing transactions and, as may be agreed
upon by the parties, provide reports regarding shareholder activity,
including through omnibus accounts, upon the CCO’s reasonable request.
USBFS will use its best efforts to notify the Fund of any transaction
or
combination of transactions that evidence market timing activity in
the
Fund’s shares.
|
| 3. |
Lost
Shareholder Due Diligence Searches and
Servicing
|
The
Fund
hereby
acknowledges that USBFS has an arrangement with an outside vendor to conduct
lost shareholder searches required by Rule 17Ad-17 under the Securities Exchange
Act of 1934, as amended. Costs associated with such searches will be passed
through to the Fund as an out-of-pocket expense in accordance with the fee
schedule set forth in Exhibit
B
hereto.
If a shareholder remains lost and the shareholder’s account unresolved after
completion of the mandatory Rule 17Ad-17 search, the Fund hereby authorizes
vendor to enter, at its discretion, into fee sharing arrangements with the
lost
shareholder (or such lost shareholder’s representative or executor) to conduct a
more in-depth search in order to locate the lost shareholder before the
shareholder’s assets escheat to the applicable state. The Fund hereby
acknowledges that USBFS is not a party to these arrangements and does not
receive any revenue sharing or other fees relating to these arrangements.
Furthermore, the Fund hereby acknowledges that vendor may receive up to 35%
of
the lost shareholder’s assets as compensation for its efforts in locating the
lost shareholder.
| 4. |
Anti-Money
Laundering Program
|
The
Fund
acknowledges that it has had an opportunity to review, consider and comment
upon
the written procedures provided by USBFS describing various tools used by USBFS
which are designed to promote the detection and reporting of potential money
laundering activity by monitoring certain aspects of shareholder activity as
well as written procedures for verifying a customer’s identity (collectively,
the “Procedures”). Further, the Fund has determined that the Procedures, as part
of the Fund’s overall anti-money laundering program, are reasonably designed to
prevent the Fund from being used for money laundering or the financing of
terrorist activities and to achieve compliance with the applicable provisions
of
the USA Patriot Act of 2002 and the implementing regulations
thereunder.
Based
on
this determination, the Fund hereby instructs and directs USBFS to implement
the
Procedures on the Fund’s behalf, as such may be amended or revised from time to
time. It is contemplated that these Procedures will be amended from time to
time
by the parties as additional regulations are adopted and/or regulatory guidance
is provided relating to the Fund’s anti-money laundering
responsibilities.
USBFS
agrees to provide to the Fund:
| (a) |
Prompt
written notification of any transaction or combination of transactions
that USBFS believes, based on the Procedures, evidence money laundering
activity in connection with the Fund or any shareholder of the
Fund;
|
| (b) |
Prompt
written notification of any customer(s) that USBFS reasonably believes,
based upon the Procedures, to be engaged in money laundering activity,
provided that the Fund agrees not to communicate this information to
the
customer;
|
| (c) |
Any
reports received by USBFS from any government agency or applicable
industry self-regulatory organization pertaining to USBFS’s anti-money
laundering monitoring on behalf of the
Fund;
|
| (d) |
Prompt
written notification of any action taken in response to anti-money
laundering violations as described in (a), (b) or (c);
and
|
| (e) |
Certified
annual and quarterly reports of its monitoring and customer identification
activities on behalf of the Fund.
|
The
Fund
hereby directs, and USBFS acknowledges, that USBFS shall (i) permit federal
regulators access to such information and records maintained by USBFS and
relating to USBFS’s implementation of the Procedures, on behalf of the Fund, as
they may request, and (ii) permit such federal regulators to inspect USBFS’s
implementation of the Procedures on behalf of the Fund.
| 5. |
Compensation
|
USBFS
shall be compensated for providing the services set forth in this Agreement
in
accordance with the fee schedule set forth on Exhibit
B
hereto
(as amended from time to time). USBFS shall also be compensated for such
out-of-pocket expenses (e.g., telecommunication charges, postage and delivery
charges, and reproduction charges) as are reasonably incurred by USBFS in
performing its duties hereunder. The Fund shall pay all such fees and
reimbursable expenses within 30 calendar days following receipt of the billing
notice, except for any fee or expense subject to a good faith dispute. The
Fund
shall notify USBFS in writing within 30 calendar days following receipt of
each
invoice if the Fund is disputing any amounts in good faith. The Fund shall
pay
such disputed amounts within 10 calendar days of the day on which the parties
agree to the amount to be paid. With the exception of any fee or expense the
Fund is disputing in good faith as set forth above, unpaid invoices shall accrue
a finance charge of 1½% per month after the due date.
| 6. |
Representations
and Warranties
|
| A. |
The
Fund hereby represents and warrants to USBFS, which representations
and
warranties shall be deemed to be continuing throughout the term of
this
Agreement, that:
|
|
(1)
|
It
is duly organized and existing under the laws of the jurisdiction
of its
organization, with full power to carry on its business as now conducted,
to enter into this Agreement and to perform its obligations
hereunder;
|
|
(2)
|
This
Agreement has been duly authorized, executed and delivered by the
Fund in
accordance with all requisite action and constitutes a valid and
legally
binding obligation of the Fund, enforceable in accordance with its
terms,
subject to bankruptcy, insolvency, reorganization, moratorium and
other
laws of general application affecting the rights and remedies of
creditors
and secured parties;
|
|
(3)
|
It
is conducting its business in compliance in all material respects
with all
applicable laws and regulations, both state and federal, and has
obtained
all regulatory approvals necessary to carry on its business as now
conducted; there is no statute, rule, regulation, order or judgment
binding on it and no provision of its charter, bylaws or any contract
binding it or affecting its property which would prohibit its execution
or
performance of this Agreement; and
|
|
(4)
|
A
registration statement under the 1940 Act and the Securities Act
of 1933,
as amended, is effective as of the date of this Agreement and will
remain
effective during the term of this Agreement, and appropriate state
securities law filings have been made as of the date of this Agreement
and
will continue to be made during the term of this Agreement as necessary
to
enable the Fund to make a continuous public offering of its
shares.
|
| B. |
USBFS
hereby represents and warrants to the Fund, which representations and
warranties shall be deemed to be continuing throughout the term of
this
Agreement, that:
|
|
(1)
|
It
is duly organized and existing under the laws of the jurisdiction
of its
organization, with full power to carry on its business as now conducted,
to enter into this Agreement and to perform its obligations
hereunder;
|
|
(2)
|
This
Agreement has been duly authorized, executed and delivered by USBFS
in
accordance with all requisite action and constitutes a valid and
legally
binding obligation of USBFS, enforceable in accordance with its terms,
subject to bankruptcy, insolvency, reorganization, moratorium and
other
laws of general application affecting the rights and remedies of
creditors
and secured parties;
|
|
(3)
|
It
is conducting its business in compliance in all material respects
with all
applicable laws and regulations, both state and federal, and has
obtained
all regulatory approvals necessary to carry on its business as now
conducted; there is no statute, rule, regulation, order or judgment
binding on it and no provision of its charter, bylaws or any contract
binding it or affecting its property which would prohibit its execution
or
performance of this Agreement; and
|
|
(4)
|
It
is a registered transfer agent under the Exchange
Act.
|
| 7. |
Standard
of Care; Indemnification; Limitation of
Liability
|
| A. |
USBFS
shall exercise reasonable care in the performance of its duties under
this
Agreement. USBFS shall not be liable for any error of judgment or mistake
of law or for any loss suffered by the Fund in connection with its
duties
under this Agreement, including losses resulting from mechanical
breakdowns or the failure of communication or power supplies beyond
USBFS’s control, except a loss arising out of or relating to USBFS’s
refusal or failure to comply with the terms of this Agreement or from
its
bad faith, negligence, or willful misconduct in the performance of
its
duties under this Agreement. Notwithstanding any other provision of
this
Agreement, if USBFS has exercised reasonable care in the performance
of
its duties under this Agreement, the Fund shall indemnify and hold
harmless USBFS from and against any and all claims, demands, losses,
expenses, and liabilities of any and every nature (including reasonable
attorneys’ fees) that USBFS may sustain or incur or that may be asserted
against USBFS by any person arising out of any action taken or omitted
to
be taken by it in performing the services hereunder (i) in accordance
with
the foregoing standards, or (ii) in reliance upon any written or oral
instruction provided to USBFS by any duly authorized officer of the
Fund,
as approved by the Board of Directors of the Fund (the “Board of
Directors”), except for any and all claims, demands, losses, expenses, and
liabilities arising out of or relating to USBFS’s refusal or failure to
comply with the terms of this Agreement or from its bad faith, negligence
or willful misconduct in the performance of its duties under this
Agreement. This indemnity shall be a continuing obligation of the Fund,
its successors and assigns, notwithstanding the termination of this
Agreement. As used in this paragraph, the term “USBFS” shall include
USBFS’s directors, officers and
employees.
|
USBFS
shall indemnify and hold the Fund harmless from and against any and all claims,
demands, losses, expenses, and liabilities of any and every nature (including
reasonable attorneys’ fees) that the Fund may sustain or incur or that may be
asserted against the Fund by any person arising out of any action taken or
omitted to be taken by USBFS as a result of USBFS’s refusal or failure to comply
with the terms of this Agreement, or from its bad faith, negligence, or willful
misconduct in the performance of its duties under this Agreement. This indemnity
shall be a continuing obligation of USBFS, its successors and assigns,
notwithstanding the termination of this Agreement. As used in this paragraph,
the term “Fund”
shall
include the Fund’s
directors, officers and employees.
Neither
party to this Agreement shall be liable to the other party for consequential,
special or punitive damages under any provision of this Agreement.
In
the
event of a mechanical breakdown or failure of communication or power supplies
beyond its control, USBFS shall take all reasonable steps to minimize service
interruptions for any period that such interruption continues. USBFS will make
every reasonable effort to restore any lost or damaged data and correct any
errors resulting from such a breakdown at the expense of USBFS. USBFS agrees
that it shall, at all times, have reasonable contingency plans with appropriate
parties, making reasonable provision for emergency use of electrical data
processing equipment to the extent appropriate equipment is available and to
otherwise operate a business continuity plan to avoid an inability to perform
under this Agreement. Representatives of the Fund shall be entitled to inspect
USBFS’s premises and operating capabilities at any time during regular business
hours of USBFS, upon reasonable notice to USBFS. Moreover, USBFS shall provide
the Fund, at such times as the Fund may reasonably require, copies of reports
rendered by independent accountants on the internal controls and procedures
of
USBFS relating to the services provided by USBFS under this
Agreement.
Notwithstanding
the above, USBFS reserves the right to reprocess and correct administrative
errors at its own expense.
| B. |
In
order that the indemnification provisions contained in this section
shall
apply, it is understood that if in any case the indemnitor may be asked
to
indemnify or hold the indemnitee harmless, the indemnitor shall be
fully
and promptly advised of all pertinent facts concerning the situation
in
question, and it is further understood that the indemnitee will use
all
reasonable care to notify the indemnitor promptly concerning any situation
that presents or appears likely to present the probability of a claim
for
indemnification. The indemnitor shall have the option to defend the
indemnitee against any claim that may be the subject of this
indemnification. In the event that the indemnitor so elects, it will
so
notify the indemnitee and thereupon the indemnitor shall take over
complete defense of the claim, and the indemnitee shall in such situation
initiate no further legal or other expenses for which it shall seek
indemnification under this section. The indemnitee shall in no case
confess any claim or make any compromise in any case in which the
indemnitor will be asked to indemnify the indemnitee except with the
indemnitor’s prior written consent.
|
| C. |
The
indemnity and defense provisions set forth in this Section 7 shall
indefinitely survive the termination and/or assignment of this
Agreement.
|
| D. |
If
USBFS is acting in another capacity for the Fund pursuant to a separate
agreement, nothing herein shall be deemed to relieve USBFS of any of
its
obligations in such other capacity.
|
| 8. |
Data
Necessary to Perform Services
|
The
Fund
or its agent shall furnish to USBFS the data necessary to perform the services
described herein at such times and in such form as mutually agreed upon.
| 9. |
Proprietary
and Confidential Information
|
USBFS
agrees on behalf of itself and its directors, officers, and employees to treat
confidentially and as proprietary information of the Fund, all records and
other
information relative to the Fund and prior, present, or potential shareholders
of the Fund (and clients of said shareholders), and not to use such records
and
information for any purpose other than the performance of its responsibilities
and duties hereunder, except (i) after prior notification to and approval in
writing by the Fund, which approval shall not be unreasonably withheld and
may
not be withheld where USBFS may be exposed to civil or criminal contempt
proceedings for failure to comply, (ii) when requested to divulge such
information by duly constituted authorities, or (iii) when so requested by
the
Fund. Records and other information which have become known to the public
through no wrongful act of USBFS or any of its employees, agents or
representatives, and information that was already in the possession of USBFS
prior to receipt thereof from the Fund or its agent, shall not be subject to
this paragraph.
Further,
USBFS will adhere to the privacy policies adopted by the Fund pursuant to Title
V of the Xxxxx-Xxxxx-Xxxxxx Act, as may be modified from time to time. In this
regard, USBFS shall have in place and maintain physical, electronic and
procedural safeguards reasonably designed to protect the security,
confidentiality and integrity of, and to prevent unauthorized access to or
use
of, records and information relating to the Fund and its current or former
shareholders.
| 10. |
Records
|
USBFS
shall keep records relating to the services to be performed hereunder in the
form and manner, and for such period, as it may deem advisable and is agreeable
to the Fund, but not inconsistent
with the
rules and regulations of appropriate government authorities, in particular,
Section 31 of the 1940 Act and the rules thereunder. USBFS agrees that all
such
records prepared or maintained by USBFS relating to the services to be performed
by USBFS hereunder are the property of the Fund and will be preserved,
maintained, and made available in accordance with such applicable sections
and
rules of the 1940 Act and will be promptly surrendered to the Fund or its
designee on and in accordance with its request.
| 11. |
Compliance
with Laws
|
The
Fund
has and retains primary responsibility for all compliance matters relating
to
the Fund, including but not limited to compliance with the 1940 Act, the
Internal Revenue Code of 1986, the Xxxxxxxx-Xxxxx Act of 2002, the USA Patriot
Act of 2002 and the policies and limitations of the Fund relating to its
portfolio investments as set forth in its Prospectus and statement of additional
information. USBFS’s services hereunder shall not relieve the Fund of its
responsibilities for assuring such compliance or the Board of Directors’
oversight responsibility with respect thereto.
| 12. |
Term
of Agreement; Amendment
|
This
Agreement shall become effective as of the date first written above and will
continue in effect for a period of one year. Subsequent to the initial one-year
term, this Agreement may be terminated by either party upon giving 90 days
prior
written notice to the other party or such shorter period as is mutually agreed
upon by the parties. Notwithstanding the foregoing, this Agreement may be
terminated by any party upon the breach of the other party of any material
term
of this Agreement if such breach is not cured within 15 days of notice of such
breach to the breaching party. This Agreement may not be amended or modified
in
any manner except by written agreement executed by USBFS and the Fund, and
authorized or approved by the Board of Directors.
| 13. |
Duties
in the Event of Termination
|
In
the
event that, in connection with termination, a successor to any of USBFS’s duties
or responsibilities hereunder is designated by the Fund by written notice to
USBFS, USBFS will promptly, upon such termination and at the expense of the
Fund, transfer to such successor all relevant books, records, correspondence,
and other data established or maintained by USBFS under this Agreement in a
form
reasonably acceptable to the Fund (if such form differs from the form in which
USBFS has maintained the same, the Fund shall pay any reasonable expenses
associated with transferring the data to such form), and will cooperate in
the
transfer of such duties and responsibilities, including provision for assistance
from USBFS’s personnel in the establishment of books, records, and other data by
such successor. If no such successor is designated, then such books, records
and
other data shall be returned to the Fund.
| 14. |
Assignment
|
This
Agreement shall extend to and be binding upon the parties hereto and their
respective successors and assigns; provided, however, that this Agreement shall
not be assignable by the Fund without the written consent of USBFS, or by USBFS
without the written consent of the Fund accompanied by the authorization or
approval of its Board of Directors.
| 15. |
Governing
Law
|
This
Agreement shall be construed in accordance with the laws of the State of
Maryland, without regard to conflicts of law principles. To the extent that
the
applicable laws of the State of Maryland, or any of the provisions herein,
conflict with the applicable provisions of the 1940 Act, the latter shall
control, and nothing herein shall be construed in a manner inconsistent with
the
1940 Act or any rule or order of the Securities and Exchange Commission
thereunder.
| 16. |
No
Agency Relationship
|
Nothing
herein contained shall be deemed to authorize or empower either party to act
as
agent for the other party to this Agreement, or to conduct business in the
name,
or for the account, of the other party to this Agreement.
| 17. |
Services
Not Exclusive
|
Nothing
in this Agreement shall limit or restrict USBFS from providing services to
other
parties that are similar or identical to some or all of the services provided
hereunder.
| 18. |
Invalidity
|
Any
provision of this Agreement which may be determined by competent authority
to be
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction. In such case, the
parties shall in good faith modify or substitute such provision consistent
with
the original intent of the parties.
| 19. |
Notices
|
Any
notice required or permitted to be given by either party to the other shall
be
in writing and shall be deemed to have been given on the date delivered
personally or by courier service, or three
days
after sent by registered or certified mail, postage prepaid, return receipt
requested, or on the date sent and confirmed received by facsimile transmission
to the other party’s address set forth below:
Notice
to
USBFS shall be sent to:
U.S.
Bancorp Fund Services, LLC
000
Xxxx
Xxxxxxxx Xxxxxx
Xxxxxxxxx,
XX 00000
Fax
No.:
(000) 000-0000
and
notice to the Fund shall be sent to:
Greenspring
Fund, Inc.
0000
Xxxx
Xxxxx Xxxx, Xxxxx 000
Xxxxxxxxxxx,
XX 00000
Fax
No.:
(000) 000-0000
| 20. |
Multiple
Originals
|
This
Agreement may be executed on two or more counterparts, each of which when so
executed shall be deemed to be an original, but such counterparts shall together
constitute but one and the same instrument.
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by
a duly authorized officer on one or more counterparts as of the date first
above
written.
GREENSPRING
FUND, INC. U.S.
BANCORP FUND SERVICES, LLC
By:
______________________________ By:
________________________________
Title:
__________________________ Title:
______________________________
