EXHIBIT (h)(2)
TRANSFER AGENCY AGREEMENT
THIS AGREEMENT made as of the 1st day of November, 2002, by and
between Choice Funds, a Delaware business trust (the "Trust"), and UMB
Fund Services, Inc., a Wisconsin corporation ("UMBFS"):
WHEREAS, the Trust 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 beneficial interest
("Shares") in separate series with each such series representing the
interests in a separate portfolio of securities and other assets;
WHEREAS, the Trust desires to retain UMBFS to render the transfer
agency and other services contemplated hereby with respect to each of the
investment portfolios of the Trust as are listed on Schedule A hereto and
any additional investment portfolios the Trust and UMBFS may agree upon
and include on Schedule A as such Schedule may be amended from time to
time (such investment portfolios and any additional investment portfolios
are individually referred to as a "Fund" and collectively the "Funds"),
and UMBFS is willing to render such services.
NOW, THEREFORE, in consideration of the mutual promises and
agreements 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:
ARTICLE I
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APPOINTMENT OF TRANSFER AGENT
A. APPOINTMENT.
1. The Trust hereby appoints UMBFS as transfer agent and
dividend disbursing agent of all the Shares of the Funds during the
period of this Agreement, and UMBFS hereby accepts such appointment as
transfer agent and dividend disbursing agent and agrees to perform the
duties thereof as hereinafter set forth.
2. UMBFS shall perform the transfer agent and dividend
disbursing agent services described on Schedule B hereto. To the extent
that the Trust requests UMBFS to perform any additional services, UMBFS
and the Trust shall mutually agree as to the services to be accomplished,
the manner of accomplishment and the compensation to which UMBFS shall be
entitled with respect thereto.
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3. UMBFS may, in its discretion, appoint in writing other
parties qualified to perform transfer agency services (each,
individually, a "Sub-transfer Agent"), provided such appointment is
approved by a majority of the Trustees of the Trust, to carry out some or
all of its responsibilities under this Agreement with respect to a Fund;
provided, however, that unless the Trust shall enter into a written
agreement with such Sub-transfer Agent, the Sub-transfer Agent shall be
the agent of UMBFS and not the agent of the Trust and, in such event
UMBFS shall be fully responsible for the acts or omissions of such
Sub-transfer Agent and shall not be relieved of any of its
responsibilities hereunder by the appointment of such Sub-transfer Agent.
4. UMBFS shall have no duties or responsibilities whatsoever
hereunder except such duties and responsibilities as are specifically set
forth in this Agreement, and no covenant or obligation shall be implied
in this Agreement against UMBFS.
B. DOCUMENTS/RECORDS.
1. In connection with such appointment, the Trust shall
deliver or cause to be delivered the following documents to UMBFS:
a) A copy of the Declaration of Trust and By-laws of the
Trust and all amendments thereto, and a copy of the resolutions of the
Board of Trustees of the Trust appointing UMBFS and authorizing the
execution of this Transfer Agency Agreement on behalf of the Funds, each
certified by the Secretary of the Trust;
b) A certificate signed by the President and Secretary
of the Trust specifying: the number of authorized Shares and the number
of such authorized Shares issued and currently outstanding, if any; and
the individuals authorized to provide oral instructions and to sign
written instructions and requests on behalf of the Trust (hereinafter
referred to as "Authorized Persons") and to change the persons authorized
to provide such instructions from time to time, it being understood UMBFS
shall not be held to have notice of any change in the authority of any
Authorized Person until receipt of written notice thereof from the
Trust;
d) Copies of the Trust's Registration Statement, as
amended to date, and the most recently filed Pre- or Post-Effective
Amendment thereto, filed by the Trust with the Securities and Exchange
Commission under the Securities Act of 1933, as amended (the "1933 Act"),
and under the 1940 Act, as amended, together with any applications filed
in connection therewith; and
e) Opinion of counsel for the Trust with respect to the
Trust's organization and existence under the laws of its state of
organization, the validity of the authorized and outstanding Shares,
whether such Shares are fully paid and non-assessable and the status of
such Shares under the Securities Act of 1933, as amended, and any other
applicable federal law or regulation (i.e., if subject to registration,
that they have been registered and that the Registration Statement has
become effective or, if exempt, the specific grounds therefor.)
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2. The Trust agrees to deliver or to cause to be delivered to
UMBFS in Milwaukee, Wisconsin, at the Trust's expense, all of its
shareholder account records relating to the Funds in a format acceptable
to UMBFS and all such other documents, records and information as UMBFS
may reasonably request in order for UMBFS to perform its services
hereunder.
ARTICLE II
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COMPENSATION & EXPENSES
A. COMPENSATION. In consideration for its services hereunder as
transfer agent and dividend disbursing agent, each Fund will pay to UMBFS
such compensation as set forth in Schedule C attached hereto.
B. EXPENSES. The Trust on behalf of each Fund also agrees to
promptly reimburse UMBFS for all out-of-pocket expenses or disbursements
incurred by UMBFS in connection with the performance of services under
this Agreement including, but not limited to, expenses for postage,
express delivery services, freight charges, envelopes, checks, drafts,
forms (continuous or otherwise), specially requested reports and
statements, bank account service fees and charges, telephone calls,
telegraphs, stationery supplies, outside printing and mailing firms,
magnetic tapes, reels or cartridges (if sent to a Fund or to a third
party at a Fund's request) and magnetic tape handling charges, on-site
and off-site record storage, media for storage of records (e.g.,
microfilm, microfiche, optical platters, computer tapes and disks),
computer equipment installed at a Fund's request at a Fund's or a third
party's premises, telecommunications equipment,
telephone/telecommunication lines between the Trust and its agents, on
one hand, and UMBFS on the other, proxy soliciting, processing and/or
tabulating costs, second site back-up computer facility, transmission of
statement data for remote printing or processing, and transaction fees to
the extent any of the foregoing are paid by UMBFS. If requested by UMBFS,
postage and other out-of-pocket expenses are payable in advance, and in
the event requested, postage is due at least seven days prior to the
anticipated mail date. In the event UMBFS requests advance payment, UMBFS
shall not be obligated to incur such expenses or perform the related
service(s) until payment is received.
C. PAYMENT PROCEDURES.
1. Amounts due hereunder shall be due and paid by the
respective Fund on or before the 15th day after the date of the statement
therefor (the "Due Date"). Service fees are billed monthly, and
out-of-pocket expenses are billed as incurred (unless prepayment is
requested by UMBFS). UMBFS may, at its option, arrange to have various
service providers submit invoices directly to the Funds for payment of
out-of-pocket expenses reimbursable hereunder. The Trust is aware that
its failure to pay all amounts in a timely fashion so that they will be
received by UMBFS on or before the Due Date will give rise to costs to
UMBFS not contemplated by this Agreement, including but not limited to
carrying, processing and accounting charges. Accordingly, in the event
that any amounts due hereunder are not received by UMBFS by the Due Date,
the Trust shall pay a late charge equal to one and one-half percent
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(1.5%) per month or the maximum amount permitted by law, whichever is
less. In addition, the Trust shall pay reasonable attorney's fees and
court costs of UMBFS if any amounts due UMBFS are collected by or through
an attorney. The parties hereby agree that such late charge represents a
fair and reasonable computation of the costs incurred by reason of late
payment or payment of amounts not properly due. Acceptance of such late
charge shall in no event constitute a waiver of a Fund's default or
prevent UMBFS from exercising any other rights and remedies available to
it.
ARTICLE III
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PROCESSING AND PROCEDURES
A. ISSUANCE, REDEMPTION AND TRANSFER OF SHARES
1. UMBFS acknowledges that it has received a copy of each
Fund's Prospectus (as hereinafter defined), which Prospectus describes
how sales and redemptions of shares of each Fund shall be made and UMBFS
agrees to accept purchase orders and redemption requests with respect to
Fund shares on each Fund Business Day in accordance with such Prospectus.
"Fund Business Day" shall be deemed to be each day on which the New York
Stock Exchange is open for trading, and "Prospectus" shall mean the last
Fund prospectus actually received by UMBFS from the Fund with respect to
which the Fund has indicated a registration statement under the 1933 Act
has become effective, including the Statement of Additional Information,
incorporated by reference therein.
2. On each Fund Business Day UMBFS shall, as of the time at
which the net asset value of each Fund is computed, issue to and redeem
from the accounts specified in a purchase order or redemption request in
proper form and accepted by the Trust, which in accordance with the
Prospectus is effective on such Fund Business Day, the appropriate number
of full and fractional Shares based on the net asset value per Share of
the respective Fund specified in an advice received on such Fund Business
Day from or on behalf of the Fund.
3. Upon the issuance of any Shares in accordance with this
Agreement, UMBFS shall not be responsible for the payment of any original
issue or other taxes required to be paid by the Fund in connection with
such issuance of any Shares.
4. UMBFS shall not be required to issue any Shares after it
has received from an Authorized Person or from an appropriate federal or
state authority written notification that the sale of Shares has been
suspended or discontinued, and UMBFS shall be entitled to rely upon such
written notification.
5. Upon receipt of a redemption request and monies paid to it
by the Fund's custodian bank ("Custodian") in connection with a
redemption of Shares, UMBFS shall cancel the redeemed Shares and after
making appropriate deduction for any withholding of taxes
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required of it by applicable law, make payment in accordance with the
Fund's redemption and payment procedures described in the Prospectus.
6. (a) Except as otherwise provided in sub-paragraph (b) of
this paragraph, Shares will be transferred or redeemed upon presentation
to UMBFS of instructions in good order endorsed for exchange, transfer or
redemption, accompanied by such documents as UMBFS deems necessary to
evidence the authority of the person making such transfer or redemption,
and bearing satisfactory evidence of the payment of stock transfer taxes.
UMBFS reserves the right to refuse to transfer or redeem Shares until it
is satisfied that the endorsement on the stock certificate, if any, or
instructions is valid and genuine, and for that purpose it will require,
unless otherwise instructed by an Authorized Person or except as provided
in sub-paragraph (b) of this paragraph, a guarantee of signature by an
"Eligible Guarantor Institution" as that term is defined by SEC Rule
17Ad-15(a)(2) of the Securities Exchange Act of 1934, as amended. UMBFS
also reserves the right to refuse to transfer or redeem Shares until it
is satisfied that the requested transfer or redemption is legally
authorized, and it shall incur no liability for the refusal, in good
faith, to make transfers or redemptions which UMBFS, in its judgment,
deems improper or unauthorized, or until it is satisfied that there is no
reasonable basis to any claims adverse to such transfer or redemption.
UMBFS may, in effecting transfers and redemptions of Shares, rely upon
those provisions of the Uniform Act for the Simplification of Fiduciary
Security Transfers or the Uniform Commercial Code, as the same may be
amended from time to time, applicable to the transfer of securities, and
shall not be responsible for any act done or omitted by it in good faith
in reliance upon such laws.
(b) Notwithstanding the foregoing or any other provision
contained in this Agreement to the contrary, UMBFS shall be fully
protected by each Fund in not requiring any instruments, documents,
assurances, endorsements or guarantees, including, without limitation,
any signature guarantees, in connection with a redemption, exchange or
transfer, of Shares whenever UMBFS reasonably believes that requiring the
same would be inconsistent with the transfer and redemption procedures as
described in the Fund's Registration Statement and/or in certified
resolutions of the Board of Trustees of the Trust provided to UMBFS.
7. Notwithstanding any provision contained in this Agreement
to the contrary, UMBFS shall not be required or expected to require, as a
condition to any transfer or redemption of any Shares pursuant to a
computer tape or electronic data transmission, any documents to evidence
the authority of the person requesting the transfer or redemption and/or
the payment of any stock transfer taxes, and shall be fully protected in
acting in accordance with the applicable provisions of this Article.
8. In connection with each purchase and each redemption of
Shares, UMBFS shall send such statements as are prescribed by the Federal
securities laws applicable to transfer agents or as described in the
Prospectus. It is understood that certificates for Shares will not be
offered by the Trust or available to investors.
9. Procedures for effecting purchase, redemption or transfer
transactions accepted from investors by telephone or other related
methods shall be established by mutual agreement
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between the Trust and UMBFS consistent with the terms of the Prospectus
and such rules and regulations generally adopted by mutual fund transfer
agents. At any time, UMBFS may request instructions from the Trust with
respect to any matter arising in connection with the foregoing
procedures. If such instructions are not received within a reasonable
time, then UMBFS may seek advice from legal counsel for the Trust, or its
own legal counsel at the expense of the Trust. UMBFS shall not be
liable, and shall be held harmless by the Trust, for any action taken or
omissions which are consistent with the foregoing procedures, or for any
action taken or omitted by it in good faith in reliance upon such
instructions or in accordance with advice of counsel.
10. Prior to the effective date of any increase or decrease in
the total number of Shares authorized to be issued, or the issuance of
any additional Shares of a Fund pursuant to stock dividends, stock
splits, recapitalizations, capital adjustments or similar transactions,
the Trust agrees to deliver to UMBFS such documents, certificates,
reports and legal opinions as UMBFS may reasonably request.
B. DIVIDENDS AND DISTRIBUTIONS.
1. The Trust shall furnish to UMBFS a copy of a resolution of
its Board of Trustees, certified by an Authorized Person, either (i)
setting forth the date of the declaration of a dividend or distribution,
the date of accrual or payment, as the case may be, thereof, the record
date as of which shareholders entitled to payment, or accrual, as the
case may be, shall be determined, the amount per Share of such dividend
or distribution, the payment date on which all previously accrued and
unpaid dividends are to be paid, and the total amount, if any, payable to
UMBFS on such payment date, or (ii) authorizing the declaration of
dividends and distributions on a daily or other periodic basis and
authorizing UMBFS to rely on a certificate of an Authorized Person
setting forth the information described in subsection (i) of this
paragraph.
2. In connection with a reinvestment of a dividend or
distribution of Shares of a Fund, UMBFS shall as of each Fund Business
Day, as specified in a certificate or resolution described in paragraph
1, issue Shares of the Fund based on the net asset value per Share of
such Fund specified in an advice received from or on behalf of the Fund
on such Fund Business Day.
3. Upon the mail date specified in such certificate or
resolution, as the case may be, the Trust shall, in the case of a cash
dividend or distribution, cause the Custodian to deposit in an account in
the name of UMBFS on behalf of a Fund, an amount of cash, if any,
sufficient for UMBFS to make the payment, as of the mail date, specified
in such Certificate or resolution, as the case may be, to the
Shareholders who were of record on the record date. UMBFS will, upon
receipt of any such cash, make payment of such cash dividends or
distributions to the shareholders of record as of the record date. UMBFS
shall not be liable for any improper payments made in accordance with a
certificate or resolution described in the preceding paragraph. If UMBFS
shall not receive from the Custodian sufficient cash to make payments of
any cash dividend or distribution to all shareholders of the Fund as of
the record date, UMBFS shall, upon notifying the Fund, withhold payment
to all shareholders of record as of the record date until sufficient cash
is provided to UMBFS.
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4. It is understood that UMBFS in its capacity as transfer
agent and dividend disbursing agent shall in no way be responsible for
the determination of the rate or form of dividends or capital gain
distributions due to the shareholders pursuant to the terms of this
Agreement. It is further understood that UMBFS shall file with the
Internal Revenue Service and shareholders such appropriate federal tax
forms concerning the payment of dividend and capital gain distributions
but shall in no way be responsible for the collection or withholding of
taxes due on such dividends or distributions due to shareholders, except
and only to the extent, required by applicable federal law.
C. RECORDS.
1. UMBFS shall keep such records as are specified in Schedule
D hereto in the form and manner, and for such period, as it may deem
advisable but not inconsistent with the rules and regulations of
appropriate government authorities, in particular Rules 31a-2 and 31a-3
under the 1940 Act. UMBFS may deliver to the Trust from time to time at
UMBFS' discretion, for safekeeping or disposition by the Trust in
accordance with law, such records, papers and documents accumulated in
the execution of its duties as such transfer agent, as UMBFS may deem
expedient, other than those which UMBFS is itself required to maintain
pursuant to applicable laws and regulations. The Trust shall assume all
responsibility for any failure thereafter to produce any such record,
paper, canceled Share certificate, or other document so returned, if and
when required. To the extent required by Section 31 of the 1940 Act and
the rules and regulations thereunder, the records specified in Schedule D
hereto maintained by UMBFS, which have not been previously delivered to
the Trust pursuant to the foregoing provisions of this paragraph, shall
be considered to be the property of the Trust, shall be made available
upon request for inspection by the officers, employees, and auditors of
the Trust, and shall be delivered to the Trust promptly upon request and
in any event upon the date of termination of this Agreement, in the form
and manner kept by UMBFS on such date of termination or such earlier date
as may be requested by the Trust.
2. UMBFS agrees to keep all records and other information
relative to the Trust, the Funds and their shareholders confidential. In
case of any requests or demands for the inspection of the shareholder
records of a Fund, UMBFS will use its best efforts to notify the Fund
promptly and to secure instructions from an Authorized Person as to such
inspection. UMBFS reserves the right, however, to exhibit the
shareholder records to any person whenever it believes there is a
reasonable likelihood that UMBFS will be held liable for the failure to
exhibit the shareholder records to such person; provided, however, that
in connection with any such disclosure UMBFS shall promptly notify the
Trust, where reasonably possible, that such disclosure has been made or
is about to be made in order to give the Trust an opportunity to take
remedial steps to block such disclosure. Notwithstanding the foregoing,
UMBFS may disclose information when requested by a shareholder concerning
an account as to which such shareholder claims a legal or beneficial
interest or when requested by the Trust, the shareholder or the dealer of
record as to such account.
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ARTICLE IV
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CONCERNING THE TRUST
A. REPRESENTATIONS. The Trust represents and warrants to UMBFS
that:
(a) It is a business trust duly organized and existing under
the laws of the State of Delaware, it is empowered under applicable laws
and by its Declaration of Trust and By-Laws to enter into and perform
this Agreement, and all requisite corporate proceedings have been taken
to authorize it to enter into and perform this Agreement.
(b) It is an investment company registered under the 1940 Act.
(c) A registration statement under the 1933 Act with respect
to the Shares is effective. The Trust shall notify UMBFS if such
registration statement or any state securities registrations have been
terminated, lapse or a stop order has been entered with respect to the
Shares.
B. COVENANTS.
1. The Trust will provide to UMBFS copies of all amendments
to its Declaration of Trust and By-laws made after the date of this
Agreement. If requested by UMBFS, each copy of the Declaration of Trust
and By-laws of the Trust and copies of all amendments thereto shall be
certified by the Secretary of the Trust.
2. The Trust shall deliver to UMBFS the Fund's currently
effective Prospectus and, for purposes of this Agreement, UMBFS shall not
be deemed to have notice of any information contained in such Prospectus
until a reasonable time (not to exceed three business days) after it is
actually received by UMBFS.
3. All requisite steps will be taken by the Trust from time
to time when and as necessary to register the Trust's shares for sale in
all states in which Trust shares shall at the time be offered for sale
and require registration. If at any time the Trust receives notice of
any stop order or other proceeding in any such state affecting such
registration or the sale of Trust shares, or of any stop order or other
proceeding under the federal securities laws affecting the sale of Trust
shares, the Trust will give prompt notice thereof to UMBFS.
4. The Trust will comply with all applicable requirements of
the 1933 Act, the Securities Exchange Act of 1934, as amended, the 1940
Act, blue sky laws, and any other applicable laws, rules and regulations.
5. The Trust agrees that prior to effecting any change in the
Prospectus which would increase or alter the duties and obligations of
UMBFS hereunder, it shall advise UMBFS of such proposed change at least
30 days prior to the intended date of the same, and shall proceed with
such change only if it shall have received the written consent of UMBFS
thereto, which shall not be unreasonably withheld.
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ARTICLE V
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CONCERNING THE TRANSFER AGENT
A. REPRESENTATIONS. UMBFS represents and warrants to the Fund
that:
(a) It is a corporation duly organized and existing under the
laws of the State of Wisconsin, is empowered under applicable law and by
its Articles of Incorporation and By-laws to enter into and perform this
Agreement, and all requisite proceedings have been taken to authorize it
to enter into and perform this Agreement.
(b) It is duly registered as a transfer agent under Section
17A of the Securities Exchange Act of 1934, as amended, to the extent
required.
(c) To the extent it deems necessary, it (a) has reviewed its
business and operations as they relate to the services provided
hereunder, (b) has developed or is developing a program to remediate or
replace computer applications and systems, and (c) has developed a
testing plan to test where reasonably feasible the remediation or
replacement of computer applications/systems, in each case, to address on
a timely basis the risk that certain computer applications/systems used
by UMBFS may be unable to recognize and properly perform date sensitive
functions involving dates prior to, including and after December 31,
1999, including dates such as February 29, 2000. To UMBFS' knowledge and
belief, its proprietary systems are Year 2000 compliant in all material
respects with regard to the services to be provided under this Agreement.
B. LIMITATION OF LIABILITY; INDEMNIFICATION.
1. UMBFS shall not be liable for any loss or damage,
including counsel fees, resulting from its actions or omissions to act or
otherwise, in the absence of its bad faith, willful misfeasance, gross
negligence or reckless disregard of its duties under this Agreement.
UMBFS shall not be liable in acting upon any writing, document or
instructions believed by it to be genuine and to have been signed or made
by an Authorized Person or verbal instructions which the individual
receiving the instructions on behalf of UMBFS believes to have been given
by an Authorized Person, and UMBFS shall not be held to have any notice
of any change of authority of any person until receipt of written notice
thereof from a Fund or such person.
2. The Trust on behalf of the Funds agrees to indemnify and
hold harmless UMBFS, its employees, agents, members, officers and
nominees from and against any and all claims, demands, actions and suits,
whether groundless or otherwise, and from and against any and all
judgments, liabilities, losses, damages, costs, charges, counsel fees and
other expenses of every nature and character arising out of or in any way
relating to UMBFS's actions taken or nonactions with respect to the
performance of services under this Agreement or based, if applicable,
upon reliance on information, records, instructions (oral or written) or
requests given or made to UMBFS by the Funds, its officers, directors,
agents or representatives; provided that this indemnification shall not
apply to actions or omissions of UMBFS in cases of its own willful
misfeasance or gross negligence, and further provided that prior to
confessing any claim against
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it which may be the subject of this indemnification, UMBFS shall give the
Funds written notice of and reasonable opportunity to defend against said
claim in its own name or in the name of UMBFS. The indemnity and defense
provisions provided hereunder shall indefinitely survive the termination
of this Agreement.
3. UMBFS assumes no responsibility hereunder, and shall not
be liable, for any damage, loss of data, errors, delay or any other loss
whatsoever caused by events beyond its reasonable control. UMBFS will,
however, take all reasonable steps to minimize service interruptions for
any period that such interruption continues beyond UMBFS's control.
4. In no event and under no circumstances shall either party
to this Agreement be liable to anyone, including, without limitation to
the other party, for consequential or punitive damages for any act or
failure to act under any provision of this Agreement even if advised of
the possibility thereof.
5. Notwithstanding any of the provisions of this Agreement,
UMBFS shall be under no duty or obligation under this Agreement to
inquire into, and shall not be liable for:
(a) The legality of the issue or sale of any Shares, the
sufficiency of the amount to be received therefor, or the authority of a
Fund, as the case may be, to request such sale or issuance;
(b) The legality of a transfer of Shares, or of a
redemption of any Shares, the propriety of the amount to be paid
therefor, or the authority of a Fund, as the case may be, to request such
transfer or redemption;
(c) The legality of the declaration of any dividend by a
Fund, or the legality of the issue of any Shares in payment of any stock
dividend, or the legality of any recapitalization or readjustment of
Shares.
ARTICLE VI
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TERM
1. This Agreement shall remain in full force and effect until
terminated as provided below.
2. Either of the parties hereto may terminate this Agreement
at any time by giving to the other party a notice in writing specifying
the date of such termination, which shall be not less than ninety (90)
days after the date of receipt of such notice. In the event such notice
is given by a Fund, it shall be accompanied by a copy of a resolution of
the Board of Trustees of the Trust, certified by the Secretary or any
Assistant Secretary, electing to terminate this Agreement and designating
the successor transfer agent or transfer agents. In the event such
notice is given by UMBFS, the Fund shall on or before the termination
date, deliver to UMBFS a
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copy of a resolution of its Board of Trustees certified by the Secretary
or any Assistant Secretary designating a successor transfer agent or
transfer agents. In the absence of such designation by the Fund, the
Fund shall upon the date specified in the notice of termination of this
Agreement and delivery of the records maintained hereunder, be deemed to
be its own transfer agent and UMBFS shall thereby be relieved of all
duties and responsibilities pursuant to this Agreement. Fees and
out-of-pocket expenses incurred by UMBFS, but unpaid by a Fund upon such
termination, shall be immediately due and payable upon and
notwithstanding such termination.
3. In the event this Agreement is terminated as provided
herein, UMBFS, upon the written request of the Trust, shall deliver the
records of the Trust to the Trust or its successor transfer agent in the
form maintained by UMBFS at the expense of the Trust. The Trust shall be
responsible to UMBFS for all out-of-pocket expenses and for the costs and
expenses associated with the preparation and delivery of such media,
including: (a) any custom programming requested by Trust in connection
with the preparation of such media; (b) transportation of forms and other
materials used in connection with the processing of Fund transactions by
UMBFS; and (c) transportation of records and files in the possession of
UMBFS. UMBFS shall not reduce the level of service provided to the Trust
following notice of termination by the Trust.
ARTICLE VII
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MISCELLANEOUS
A. NOTICES. Any notice required or permitted by Article VI to be
given by either party to the other shall be in writing and shall be
deemed to have been given when sent by registered or certified mail,
postage prepaid, return receipt requested, as follows: Notice to UMBFS
shall be sent to UMB Fund Services, Inc., Inc., at 000 Xxxx Xxxxxxxx
Xxxxxx, Xxxxx X, Xxxxxxxxx, Xxxxxxxxx 00000, Attention: General Counsel,
or at such other place as UMBFS may from time to time designate in
writing, and notice to the Trust shall be sent to Choice Funds, 0000 XXX
Xxxxxxxxx, Xxxxx 0000, Xxxxxxxxx Xxxxxxx, Xxxxxxxx 00000, Attention:
President.
B. AMENDMENTS/ASSIGNMENTS.
1. This Agreement may not be amended or modified in any
manner except by a written agreement executed by both parties with the
formality of this Agreement.
2. This Agreement shall extend to and shall be binding upon
the parties hereto, and their respective successors and assigns. This
Agreement shall not be assignable by either party without the written
consent of the other party except that UMBFS may assign this Agreement to
an affiliate with advance written notice to the Trust.
C. WISCONSIN LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of Wisconsin. If any
part, term or provision of this Agreement is determined by the courts or
any regulatory authority having jurisdiction over the issue to be
illegal, in conflict with any law or otherwise invalid, the remaining
portion or portions shall be
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considered severable and not be affected, and the rights and obligations
of the parties shall be construed and enforced as if the Agreement did
not contain the particular part, term or provision held to be illegal or
invalid.
D. 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.
E. NON-EXCLUSIVE; OTHER AGREEMENTS. The services of UMBFS
hereunder are not deemed exclusive and UMBFS shall be free to render
similar services to others. Except as specifically provided herein, this
Agreement does not in any way affect any other agreements entered into
among the parties hereto and any actions taken or omitted by any party
hereunder shall not affect any rights or obligations of any other party
hereunder.
F. CAPTIONS. The captions in the Agreement are included for
convenience of reference only, and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their respective corporate officer, thereunto duly
authorized and their respective corporate seals to be hereunto affixed,
as the day and year first above written.
UMB FUND SERVICES, INC. CHOICE FUNDS
By: ______________________________ By: ________________________________
Xxxxx X. Xxxxxxx, Executive Xxxxxxx X. Xxxxx, President
Vice President
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SCHEDULE A
TO
TRANSFER AGENCY AGREEMENT
NAMES OF FUNDS
Choice Balanced Fund
Choice Focus Fund
Choice Long-Short Fund
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SCHEDULE B
TO
TRANSFER AGENCY AGREEMENT
SERVICE SCHEDULE
SERVICES
* Set up and maintain shareholder accounts and records, including IRAs
and other retirement accounts
* Store account documents electronically
* Receive and respond to investor account inquiries by telephone,
mail, or e-mail, if desired
* Process purchase and redemption orders, transfers, and exchanges,
including automatic purchases and redemptions
* Process dividend payments by check, wire or ACH, or reinvest
dividends
* Issue daily transaction confirmations and monthly or quarterly
statements
* Mail prospectus, annual and semiannual reports, and other
shareholder communications to existing shareholders
* File IRS Forms 1099, 5498, 1042, 1042-S and 945 with shareholders
and/or the IRS
* Handle load and multi-class processing, including rights of
accumulation and purchases by letters of intent
* Calculate 12b-1 plan fees
* Give dealers access through NSCC's Fund/SERV and Networking
* Provide standards to structure forms and applications for efficient
processing
OPTIONAL SERVICES
The Funds may contract with UMBFS to provide one or more of the following
optional services. Additional fees apply.
* Personal follow-up calls to prospects who return incomplete
applications
* Comprehensive clerical confirmation statements for maintenance
transactions
* 0.xxx services, UMBFS' array of Internet services, including Adviser
Services, RIA/Broker Services, Shareholder Services, NAV Services
and email services.
* Average cost calculations and cost basis statements
* Shareholder "welcome" packages with initial confirmation
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* Access to UMBFS' Tax and Retirement Group to answer questions and
coordinate retirement plan options
* Follow up on IRAs, soliciting beneficiary and other information and
sending required minimum distribution reminder letters
* Money market funds for short-term investment or exchanges
* Dedicated service representatives
* Weekend shareholder services
* Customized reorder form tracking
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SCHEDULE C
TO
TRANSFER AGENCY AGREEMENT
FEE SCHEDULE
SERVICES
The following fees are charged for standard shareholder services:
BASE FEES
* Open account fee (per year)
* No load equity and non-daily accrual fixed income funds $8.50
* Additional for 12b-1 fee $0.75
* Additional for front-end load $1.50
* Additional for CDSC or back-end load $2.00
* Money market and daily accrual fixed income funds $11.00
* Additional for 12b-1 fee $0.75
* Additional for front-end load $1.50
* Additional for CDSC or back-end load $2.00
* Closed account fee (per year) $3.00
* Monthly base (per fund)
* One to three funds in fund family $1,500
* 4 or more funds in fund family $1,000
* Add for multiclass (per class) 25%
ACCOUNT MAINTENANCE FEES (PER OCCURRENCE)
* New account set up $3.00
* Financial transactions $1.50
* Maintenance transactions $1.00
* Research/correspondence $2.50
* Transfer on death (XXX) set-up $7.50
* Fund/SERV
* Initial set-up per fund family $3,500
* Set-up fee per subsequent CUSIP $1,000
* New account set-up $1.00
* Per transaction - no load fund $0.25
* Per transaction - load fund $0.35
* Adjustments and rebills $2.50
* Fund/SERV direct charges at cost
* Commission/SERV (per check) $0.25
* ACH/AIP/SWP/automatic exchanges
* Set-up $1.00
* Per transaction $0.25
* Withholding per eligible account per year $0.25
* Account transcripts older than 2 years
(may be charged to shareholders) $5.00
* Locating lost shareholders $8.00
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* Postal clean up per account $3.00
* Tax ID number solicitation $2.50
SHAREHOLDER SERVICING FEES
* Telephone calls (per call) $2.50
* Annual maintenance per omnibus account $150
TAX AND RETIREMENT FEES
* Retirement accounts (XXX/Xxxx/others)
* Annual maintenance per account (may be
charged to shareholders) $12.50
* Account distribution (may be charged to shareholders) $12.50
* XXX transfer/rollover $7.50
DOCUMENT SERVICES
* Per statement, confirmation and check processing $0.25
* Per tax form processing $0.25
* Per label printing for proxy or marketing purposes $0.10
* Bulk mailings/insert handling charge
* 1 insert $0.06
* 2 - 3 inserts $0.08
* 4 or more inserts as quoted
* Production of ad hoc reports starting at $100
UMBFS OFFERED MONEY MARKET EXCHANGE VEHICLES
* One-time set up per money market fund used $2,000
* Monthly base fee per money market fund used $650
* Money market checkbooks at cost
* Signature verification of check writing $2.00
FORMS AND APPLICATIONS
* Standard applications and forms with custom logo $1,500 plus printing
* Customized forms as quoted
4.PROMPT(R) SERVICES (MONTHLY FEES)
* Automated Account Information and Prospectus Service
* Monthly maintenance fee $350
* One time set up fee $3,750
REPROCESSINGS DUE TO NAV ERRORS
This charge applies when shareholder transactions are required to be
reprocessed as a result of NAV errors caused by the adviser or fund
accountant unaffiliated with UMBFS. This charge is not a fund expense
and is billed to the adviser.
* Base fee (per occurrence, per day, per fund) $750
* Transaction fee $1.00
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FUND/SERV ACCESS
* Use of UMB Distribution Services, LLC Fund/SERV membership (per
fund/per year)
* First three funds in fund family $2,000
* 4 or more funds $1,000
CUSTOM PROGRAMMING
Additional fees at $150 per hour or quoted by project may apply for
special programming to meet your servicing requirements or to create
custom reports.
PREMIUM SERVICES
Certain premium services described on Exhibit B may be purchased on an
as-needed basis. Fees for premium services will be based on UMBFS'
current rate at the time services are purchased.
OUT-OF-POCKET EXPENSES
DOCUMENT CHARGES
* Copying charges (per page) $0.15
* Facsimile charges (per fax) $1.25
* Inventory and records storage $20.00/pallet
SUPPLIES AND SERVICES
* Statement paper, check stock, envelopes, tax forms at cost
* Postage and express delivery charges at cost
* Tape/disk storage at cost
* Telephone and long distance at cost
* P.O. box rental at cost
* Toll-free number at cost
BANK CHARGES
* Bank account service fees and any other bank charges at cost
* Outgoing wire fee varies by bank
* Non-sufficient funds varies by bank
* Stopped check on money market funds $25.00
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SCHEDULE D
RECORDS MAINTAINED BY UMBFS
Account applications
Canceled certificates plus stock powers and supporting documents
Checks including check registers, reconciliation records, any adjustment
records and tax withholding documentation
Indemnity bonds for replacement of lost or missing stock certificates and
checks
Liquidation, redemption, withdrawal and transfer requests including stock
powers, signature guarantees and any supporting documentation
Shareholder correspondence
Shareholder transaction records
Share transaction history of the Funds
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