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SERVICES AGREEMENT
Gentlemen:
We have an agreement (the "Distribution Agreement") with each of several
open-end investment companies, or series thereof, for which Warburg, Xxxxxx
Counsellors, Inc. ("Counsellors") provides investment advisory services
(together with such other open-end investment companies, or series thereof,
for which Counsellors may provide advisory services in the future, the
"Funds"). Pursuant to the Distribution Agreements, we act as the distributor
of shares of common stock of the Funds designated "Common Shares"
(collectively, the "Shares"). You provide recordkeeping and administrative
services to certain employee benefit plans and retirement plans (together, the
"Plans") that include or propose to include certain of the Funds as an
investment alternative. The terms "Prospectus" and "Statement" as used herein
refer respectively to the then current prospectus and statement of additional
information relating to the Shares forming parts of the Registration Statement
on Form N-1A of a Fund under the Securities Act of 1933, as amended (the "1933
Act").
As used herein, unless the context otherwise requires, "we," "ours"
and/or "us" refer to Counsellors Securities Inc. and "you", "your" and "yours"
refer to the company that is the counterparty to this Agreement.
1. Services. As applicable, you agree to provide the administrative,
shareholder and/or other services set forth on Schedule A hereto, as amended
from time to time. In providing such services, you shall not, except as
specifically provided herein, have any authority to act as agent for us or any
Fund, but shall act only as agent of the Plans and the Plan participants who
from time to time beneficially own Shares of one or more Funds and as an
independent contractor and not as an employee or agent of the Funds,
Counsellors or us.
You will maintain all records required by law, including records
detailing the services you provide in return for the fees to which you are
entitled under this Agreement. Such records shall be preserved, maintained
and made available to the extent required and
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in accordance with the Investment Company Act of 1940, as amended (the "1940
Act"), and the rules thereunder. Upon request by a Fund or us, you agree to
promptly make copies or, if required, originals of such of these records
available to the Fund or us, as the case may be. You also agree to promptly
notify the Fund or us if you experience any difficulty in maintaining the
records described in the foregoing in an accurate and complete manner. This
provision shall survive the termination of this Agreement.
You agree to furnish the Funds, Counsellors and us with such information
as we may reasonably request (including, without limitation, periodic
certifications confirming the provision to Plans and Plan participants of the
services described herein). Moreover, you agree to provide to the Funds,
Counsellors and us access to you and your personnel at our reasonable request
during normal business hours to confirm compliance with the provisions of this
Agreement and applicable law. In performing services hereunder, you agree
that you will not engage in any activities set forth in Schedule B.
You shall take all steps necessary to ensure that the arrangements
provided for in this Agreement are properly disclosed to the Plans. You agree
to inform Plans and that they and Plan participants may look only to you for
resolution of problems or that they are transacting business with you and not
with us, Counsellors or the Funds, discrepancies in their accounts or between
those accounts and your omnibus accounts (the "Accounts") at the Funds. You
and your employees will, upon request, be available during normal business
hours to consult with the Funds, Counsellors and us or our designees
concerning the performance of your responsibilities under this Agreement.
In no way shall the provisions of this Agreement limit the authority of
any Fund or us to take such action as such entity may deem appropriate or
advisable in respect of all matters pertaining to the continuous offering of
Shares. We have full authority to take such action as we may deem advisable
in respect of all matters pertaining to the continuous offering of Shares. We
reserve the right in our sole discretion and without notice to you to suspend
sales or withdraw the offering of Shares. To the extent reasonably
practicable, we or the relevant Fund will provide you with notice of any such
suspension or withdrawal and you will use your best efforts to cause
compliance with any such notice.
You shall maintain at all times general liability and other insurance
coverage, including errors and omissions coverage, that is reasonable and
customary in light of your duties hereunder, with limits of not less than $5
million. Such insurance coverage shall be issued by a qualified insurance
carrier with a Best's rating of
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at least "A" or with the highest rating of a nationally recognized statistical
rating organization.
We may enter into other similar agreements with any other person or
persons without your consent.
2. Orders for Shares. Orders received from you for Shares of a Fund
will be accepted by us only at the public offering price applicable to each
order, as set forth in the relevant Prospectus and Statement. All orders by
you for a Fund's Shares will be held through the Accounts with the Fund; and
you agree to make available on a monthly basis to the Funds records necessary
to determine the number of Plans and Plan participants in each Account
(indicating the number of new accounts opened during the month, as well as the
number of ongoing accounts) and the times of receipt of Plan participant
orders. You agree to use your best efforts to assist us in identifying
"market timers" or investors who engage in a pattern of short-term trading.
On each day on which a Fund calculates its net asset value (a "Business
Day"), you shall aggregate and calculate the net purchase and redemption
orders for each Account maintained by the Fund in which Plan participant
assets are invested. Net orders shall only reflect Plan participant orders
that you have received prior to the close of regular trading on the New York
Stock Exchange, Inc. (the "NYSE") (currently 4:00 p.m., Eastern time) on that
Business Day. Orders that you have received after the close of regular
trading on the NYSE shall be treated as though received on the next Business
Day. Each communication of orders by you shall constitute a representation
that such orders were received by you prior to the close of regular trading on
the NYSE on the Business Day on which the purchase or redemption order is
priced in accordance with Rule 22c-1 under the 1940 Act. Other procedures
relating to the handling of orders shall be in accordance with the Prospectus
and Statement of the relevant Fund or with oral or written instructions that
we or the relevant Fund shall forward to you from time to time.
Subject to the terms and conditions of this Agreement and the procedures
referred to above, you shall be appointed to act, and you by indicating next
to your signature below have agreed to act as agent of each Fund for the
purpose specifically set forth in this paragraph. Provided that you comply
with the foregoing, you shall be deemed to be an agent of each Fund to the
extent orders refer to such Fund for the sole purpose of receiving
instructions from yourself as Plan agent for the purchase and redemption of
Shares prior to the close of regular trading each Business Day and
communicating orders based on such instructions to the Fund's transfer agent,
all as specified herein, and the Business Day on which you receive such
instructions prior to the close of regular
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trading on the NYSE shall be the Business Day on which such orders will be
deemed to be received by us or the Fund's transfer agent as a result of such
instructions.
Dividends and capital gains distributions will be automatically
reinvested at net asset value in accordance with each Fund's prospectus.
Payment for Shares of a Fund ordered from us must be received together
with your order unless we agree otherwise. All orders are subject to
acceptance or rejection by us or the relevant Fund in the sole discretion of
either, or by the relevant Fund's transfer agent acting on our behalf, and
orders shall be effective only upon receipt in proper form. The Funds may, if
necessary, delay redemption of Shares to the extent permitted by the 1940 Act.
3. Fees. For the services and facilities provided by you hereunder, we
agree to pay you beginning on the effective date indicated next to our
signature below an amount calculated at the rate and in the manner set forth
in Schedule C, as amended from time to time. We will provide you, at least
monthly, a written report detailing amounts so calculated with respect to each
Fund.
You agree that during the term of this Agreement, you will not assess
against or collect from Plans or Plan participants any transaction fee upon
the purchase or redemption of any Fund's Shares that are considered in
calculating the fee due pursuant to this Agreement.
4. Counsellors Securities' Responsibilities; Limitation of Liability for
Claims. Any printed information that we furnish to you other than the
Prospectus, the Statement, information supplemental to the Prospectus and the
Statement, periodic reports and proxy solicitation materials are our sole
responsibility, and not the responsibility of any Fund, and you agree that the
Funds, the shareholders of the Funds and the officers and governing Boards of
the Funds shall have no liability or responsibility to you in these respects.
You also agree that the payment of compensation to you under this Agreement
is, except as set forth in Schedule C hereto, solely our responsibility and
not that of any Fund, and you agree that the Funds, the shareholders of the
Funds and the officers and governing Boards of the Funds shall have no
liability or responsibility to you with respect to any indebtedness, liability
or obligation hereunder. Further, it is understood, in the case of each Fund
that is organized as a Massachusetts business trust or series thereof, that
the declarations of trust for each trust refers to the trustees collectively
as trustees and not as individuals personally, and that the declaration of
trust provides that no shareholder, trustee, officer, employee or agent of the
trust shall
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be subject to claims against or obligations of the trust to any extent
whatsoever, but that the trust estate only shall be liable. No Fund shall be
liable for the obligations or liabilities of any other Fund. No series of any
Fund, if any, shall be liable for obligations of any other series.
5. Pricing Errors. In the event adjustments are required to correct any
error in the computation of the net asset value of a Fund's Shares, the Fund
or we shall notify you as soon as practicable after discovering the need for
those adjustments that result in an aggregate reimbursement of $150 or more to
the Accounts maintained by the Fund for Plan participants. Any such notice
shall state for each day for which an error occurred the incorrect price, the
correct price and, to the extent communicated to the Fund's shareholders, the
reason for the price change. You may send this notice or a derivation thereof
(so long as such derivation is approved in advance by Counsellors) to Plan
participants and Customers whose accounts are affected by the price change.
If the Accounts maintained by the Fund for Plan participants received
amounts in excess of the amounts to which it otherwise would have entitled
prior to an adjustment for an error, you, at our request, will make a good
faith attempt to collect such excess amounts from Plan participants. In no
event, however, shall you be liable to the Funds or us for any such amounts.
If an adjustment is to be made in accordance with the first paragraph of
this section 5, the relevant Fund shall make all necessary adjustments (within
the parameters specified in that first paragraph) to the number of Shares
owned in the Accounts and distribute to you the amount of such underpayment
for credit to Plan participants' accounts.
6. Termination; Assignment. This Agreement shall be terminable without
penalty upon 30 days' written notice to us by you and upon 30 days' written
notice to you by us; provided, however, that any termination of this Agreement
shall not affect any unpaid obligations under this Agreement and you shall be
entitled to receive all fees earned up to and including the effective date of
termination.
This Agreement shall not be assignable by either us or you without the
prior written consent of the Funds. Nothing in this Agreement is intended to
confer upon any person other than the Funds and the parties hereto and their
permitted assigns and successors any rights or remedies under or by reason of
this Agreement.
7. Publicity. CSI will provide you on a timely basis with investment
performance information for each Fund, including total
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return for the preceding calendar month and calendar quarter, the calendar
year to date, and the prior one-year, five-year, and ten-year (or life of the
Fund) periods. You may, based on the Securities and Exchange Commission-
mandated information supplied by CSI, prepare communications for Plan
participants ("Participant Materials"). You shall provide copies of all
Participant Materials to CSI concurrently with their first use for CSI's
internal recordkeeping purposes. It is understood that neither CSI nor any
Fund shall be responsible for errors or omissions in, or the content of,
Participant Materials.
8. Standard of Care; Indemnification. In carrying out your and our
obligations under this Agreement, you and we each agree to act in good faith
and without negligence.
You agree to and do release, indemnify and hold each Fund, its investment
adviser and their and our respective officers, trustees, directors and
controlling persons harmless from and against any and all direct or indirect
claims, liabilities, expenses or losses resulting from requests, directions,
actions or inactions of or by you or your officers, employees or agents
regarding your responsibilities hereunder. Without limiting the generality of
the foregoing, you agree that this provision will apply to claims,
liabilities, expenses or losses arising out of (a) your making any statement
or representation concerning the Shares that is not contained in the relevant
Prospectus or Statement or in such printed material issued by us or a Fund as
information supplemental to the Prospectus and Statement (including, without
limitation, any statement, representation or omission contained in Participant
Materials) and (b) a sale of Shares in any state or jurisdiction in which such
Shares are not qualified for sale or exempt from the requirements of the
relevant securities laws or in which you are not properly licensed or
authorized to make offers or sales. The Funds and CSI, in each case solely to
the extent relating to such party's responsibilities hereunder, agree to and
do release, indemnify and hold you and your officers, directors and
controlling persons harmless from and against any and all direct or indirect
claims, liabilities, expenses or losses resulting from requests, directions,
actions or inactions of or by us, any Fund or our respective officers,
employees or agents.
This provision shall survive the termination of this Agreement.
9. Representations and Warranties. Each party hereby represents and
warrants to the other that it is duly authorized by all necessary action,
approval or authorization to enter into this Agreement and that it is duly
organized, validly existing and in good standing under the laws of the
jurisdiction in which it is
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organized.
You further represent, warrant and agree that:
(i) you are fully authorized by applicable law and regulation
and by any agreement you may have with any Plan, Customer or client for whom
you may act pursuant to this Agreement to perform the services and receive the
compensation therefor described in this Agreement;
(ii) in performing the services described in this Agreement, you
will comply with all applicable laws, rules and regulations;
(iii) if you are not duly registered as a broker-dealer under
Section 15 of the Securities Exchange Act of 1934, as amended (the "1934
Act") and applicable state securities laws and regulations, you are not
required to be so registered and will not be required to be so registered
in order to perform this Agreement;
(iv) neither you nor any of your "affiliates" (as such term is
defined in 29 C.F.R. Section 2510.3-21(e)) is a "fiduciary" of any Plan
as such term is defined in section 3(21) of the Employment Retirement
Income Security Act of 1974, as amended ("ERISA"), and section 4975 of
the Internal Revenue Code of 1986, as amended (the "Code");
(v) the receipt of fees hereunder will not constitute a "prohibited
transaction" as such term is defined in section 406 of ERISA and section
4975 of the Code; and
(vi) you are duly registered as a transfer agent under Section 17A
of the 1934 Act and applicable state securities laws and regulations, and
such registrations shall continue to be in full force and effect
throughout the term of this Agreement.
10. Governing Law; Complete Agreement. This Agreement shall be governed
by and construed in accordance with the laws (except the conflict of law
rules) of the State of New York.
This Agreement contains the full and complete understanding of the
parties and supersedes all prior representations, promises, statements,
arrangements, agreements, warranties and understandings between the parties
with respect to the subject matter hereof, whether oral or written, express or
implied.
11. Amendment. This Agreement, including the Schedules
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thereto, may be modified or amended and the terms of this Agreement may be
waived only by writings signed by each of the parties.
12. Notices. All notices and communications shall be mailed or
telecopied to you to the address set forth below and to us at 000 Xxxxxxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxx X. Xxxxx (Fax No.: 212-
000-0000), or in any case to such other address as a party may request by
giving written notice to the other.
COUNSELLORS SECURITIES INC.
Date:_____________ __, 1995 By:________________________________
Name:
Title:
Effective Date: _________, 1995
WARBURG, XXXXXX INTERMEDIATE
MATURITY GOVERNMENT FUND
WARBURG, XXXXXX INTERMEDIATE MUNICIPAL
FUND
WARBURG, XXXXXX FIXED INCOME FUND
WARBURG, XXXXXX GLOBAL FIXED INCOME FUND
WARBURG, XXXXXX CAPITAL APPRECIATION FUND
WARBURG, XXXXXX INTERNATIONAL EQUITY FUND
WARBURG, XXXXXX EMERGING GROWTH FUND
WARBURG, XXXXXX EMERGING MARKETS FUND
WARBURG, XXXXXX JAPAN OTC FUND
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WARBURG, XXXXXX SHORT-TERM TAX-ADVANTAGED
BOND FUND
By: __________________________________
Name:
Title:
WARBURG, XXXXXX BALANCED FUND
WARBURG, XXXXXX GROWTH & INCOME FUND
By: ___________________________________
Name:
Title:
Please indicate your confirmation and acceptance of this Agreement as of
the date written above by signing below and returning one copy of this
Agreement to Counsellors Securities Inc., 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000, Attention: Xxxxxx X. Xx0xxx.
Accepted and Agreed:
By:
Name (Print):
Title:
Address:
Telephone No.: (000) 000-0000
Fax No.: (000) 000-0000
INDICATE INTENTION TO ACT AS AGENT
AS SET FORTH IN THIS AGREEMENT:
We agree to act as agent for the sole purpose of and to the extent set forth
in paragraph 2 of this Agreement. Yes ____ No ____
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Capitalized terms used herein and not otherwise defined shall
have the meaning set forth in the body of the Services Agreement.
SCHEDULE A
Administrative Services
(i) receiving from the Plans and Plan participants, by the close of
regular trading on the New York Stock Exchange (currently 4:00 p.m., Eastern
time) on any business day (i.e., a day on which the New York Stock Exchange is
open for trading), instructions for the purchase and redemption of shares;
aggregating and processing purchase and redemption requests for Shares from
Plan participants and Customers and placing net purchase and redemption orders
with CSI or its designee; payment for net purchase orders must be received at
the time the order is placed; communicating orders in a timely manner to CSI
or its designee and promptly delivering, or instructing the Plans to deliver,
appropriate documentation to CSI or its designee;
(ii) providing Plan participants with a service that invests the assets
of their accounts in Shares;
(iii) providing information periodically to Plans and Plan
participants showing their positions in Shares;
(iv) arranging for bank wires;
(v) providing sub-accounting with respect to Shares beneficially owned
by Plans and Plan participants;
(vi) if required by law, forwarding shareholder communications from the
relevant Fund (such as proxies, shareholder reports, annual and semi-annual
financial statements and dividend, distribution and tax notices) to Plans and
Plan participants at your expense, with such material to be provided to you by
CSI to the extent reasonably practicable upon ten Business Days' notice;
(vii) withholding taxes on non-resident alien accounts and otherwise
as appropriate;
(viii) maintaining records of dividends and distributions; and
disbursing dividends and distributions and reinvesting such in the relevant
Fund for Plans and Plan participants;
(ix) preparing and delivering to Plans, Plan participants and state and
federal regulatory authorities, including the U.S. Internal Revenue Service,
such information respecting dividends
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and distributions paid by the relevant Fund as may be required by law;
(x) maintaining adequate records for each Plan reflecting Shares
purchased and redeemed, including dates and prices for all transactions, and
Share balances;
(xi) preparing and delivering to Plan participants periodic account
statements on a quarterly basis showing the total dollar amount (contract
value) of Shares held as of the statement closing date;
(xii) on behalf of and to the extent instructed by each Plan, at your
expense deliver to Plan participants (or deliver to the Plans for distribution
to Plan participants) and Customers prospectuses, statements of additional
information and other materials provided to you by CSI to the extent
reasonably practicable upon ten Business Days' notice;
(xiii) maintain quarterly purchase summaries (expressed in dollar
amounts) for each Plan;
(xiv) settle orders in accordance with the terms of the Prospectus
and Statement of the Funds; and
(xv) transmit to us, or to the Funds if so instructed by us, such
occasional and periodic reports as we shall reasonably request from time to
time to enable us or the Funds to comply with applicable laws and regulations.
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Shareholder Services
(i) responding to Plans, Plan participant and Customer inquiries;
(ii) providing information on Plan, Plan participant and Customer
investments;
(iii) providing other shareholder liaison services;
(iv) providing office space and equipment, telephone facilities and
personnel (which may be any part of the space, equipment and facilities
currently used in your business, or any personnel employed by you) as may be
reasonably necessary or beneficial in order to provide services to Plans and
Customers under this Agreement;
(v) send confirmations of orders to the Plans and Plan participants and
Customers as required by Rule 10b-10 of the Securities Exchange Act of 1934
(the "1934 Act") and paying any costs in connection therewith;
(vi) using all reasonable efforts to ensure that taxpayer identification
numbers provided by you on behalf of the Plans, Plan participants and
Customers are correct; and
(vii) providing the Plans, Plan participants and Customers a
confirming Prospectus following an acquisition of Shares to the extent
required by law.
Other Services
(i) providing all other services as may be incidental to the
Administrative Services and Shareholder Services enumerated above;
(ii) providing such other services as may be normal or customary for
service providers performing substantially similar services; and
(iii) providing such other services as may be mutually agreed by the
parties to the extent permitted under applicable statutes, rules and
regulations.
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SCHEDULE B
Prohibited Activities
(i) You shall not withhold placing orders for the Shares received from
Plan participants and Customers so as to profit yourself as a result of such
withholding.
(ii) You shall not place orders for Shares unless you have already
received purchase orders for Shares at the applicable public offering price
and subject to the terms hereof.
(iii) You agree that you will not offer or sell any Shares except
under circumstances that will result in compliance with applicable federal and
state securities laws and that in connection with sales and offers to sell
Shares you will furnish to each person to whom any such sale or offer is made,
at or prior to the time of offering or sale, a copy of the relevant Prospectus
and, if requested, the corresponding Statement (each as then amended or
supplemented) and will not furnish to any person any information relating to a
Fund that is inconsistent in any respect with the information contained in the
Prospectus and Statement (each as then amended or supplemented).
(iv) You shall not make any representations concerning the Shares except
those contained in the relevant Prospectus and Statement and in such printed
information subsequently issued by us or a Fund as information supplemental to
the Prospectus and Statement.
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SCHEDULE C
Total Annual Fee as % of
Average Net Assets of:
Name of Fund Plans with (i) less Plans with (i) greater
than $1,000,000 than $1,000,000
Invested in the Invested in the
Funds and Funds or (ii) more
(ii) fewer than than 1,000
1,000 Participants Participants
Warburg Pincus
New York Intermediate Bond .15 .15
Intermediate Maturity .15 .15
Government
Short-Term Tax-Advantaged .15 .15
Bond .15 .15
Fixed Income .15 .15
Global Fixed Income .15 .15
Growth & Income .15 .20
International Equity .15 .20
Emerging Growth .15 .20
Capital Appreciation .15 .20
Japan OTC .15 .20
Balanced Fund .15 .20
Emerging Markets .15 .20
CSI or another of the Funds' designees shall pay the Fee to you, and
shall be reimbursed by each Fund for a portion of the Fee due with respect to
that Fund to be determined from time to time ("Fund Portion"). The difference
between the Fee due minus the Fund Portion shall not be reimbursed by the
Funds, but shall be borne by CSI or another of the Funds' designees.
These fees will be computed by CSI and paid monthly. For purposes of
determining the fees payable hereunder, the average net assets of the Plans'
and Customers' Shares will be computed in the manner specified in the relevant
Fund's registration statement (as the same is in effect from time to time) in
connection with the computation of the net asset value of Shares for purposes
of purchases and redemptions.
In computing your fee, one-twelfth of the applicable fee rate
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set forth above shall be applied to the average aggregate monthly net asset
value of shares of the applicable Funds in accounts for which you provide
services for the month in question. Each month's fee shall be determined
independently of every other month's fee. For the month in which this
Agreement becomes effective or terminates, there shall be an appropriate
proration on the basis of the number of days that the Agreement is in effect
during the month. In addition, if in any period the aggregate amount payable
to you is less than $200, we may, in our discretion, defer the payment of such
amount until it, together with a subsequent payment or payments, exceeds $200.
