RED FLAGS SERVICES AMENDMENT
EXHIBIT
(h)(1)(a)
This Red Flags Services Amendment (“Amendment”) is being entered into as of May 7, 2009
(“Effective Date”), by and between PNC Global Investment Servicing (U.S.) Inc. (“PNC”) and the
undersigned investment company (the “Fund”) and amends the agreement between PNC and the Fund
pursuant to which PNC provides transfer agency services to the Fund, as amended to date (“Existing
Agreement”).
IN CONSIDERATION of the mutual covenants made herein and other good and valuable
consideration, receipt of which is hereby acknowledged, the parties, intending to be legally bound,
hereby agree to amend the Existing Agreement as follows:
1. Modifications to Existing Agreement. The Existing Agreement shall be modified by
adding a new section which reads in its entirety as follows:
Red Flag Services (the “Red Flag Section”).
(a) PNC agrees to provide the Fund with the “Red Flag Services”, which is hereby defined to
mean the following services:
(i) PNC will maintain written controls reasonably designed to detect the occurrence of Red
Flags (as defined below) in connection with (i) account opening and other account activities
and transactions conducted directly through PNC with respect to Direct Accounts (as defined
below), and (ii) transactions effected directly through PNC by Covered Persons (as defined
below) in Covered Accounts (as defined below). Such controls, as they may be revised from
time to time hereunder, are referred to herein as the “Controls”. Solely for purposes of the
Red Flag Section, the capitalized terms below will have the respective meaning ascribed to
each:
(A) “Red Flag” means a pattern, practice, or specific activity or a combination of
patterns, practices or
specific activities which may indicate the possible existence of Identity Theft (as
defined below) affecting a
Registered Owner (as defined below) or a Covered Person.
(B) “Identity Theft” means a fraud committed or attempted using the identifying
information of another
person without authority.
(C) “Registered Owner” means a natural person who is the owner of record of a Direct
Account on the books
and records of the Fund maintained by PNC as registrar of the Fund (the “Fund Registry”).
(D) “Covered Person” means a natural person who is the owner of record of a Covered
Account on the Fund
Registry.
(E) “Direct Account” means an account holding Fund shares established directly with and
through PNC by a
natural person as a registered account on the Fund Registry and through which the owner
of record has the
ability to directly conduct account and transactional activity with and through PNC.
(F) “Covered Account” means an account holding Fund shares established by a financial
intermediary for a
natural person as the owner of record on the Fund Registry and through which such owner
of record has the
ability to conduct transactions in Fund shares directly with and through PNC.
(ii) PNC will provide the Fund with a printed copy of or Internet viewing access to the
Controls.
(iii) PNC will notify the Fund of Red Flags which it detects and reasonably determines to
indicate a significant risk of Identity Theft to a Registered Owner or Covered Person
(“Possible Identity Theft”) and assist the Fund in determining the appropriate response of
the Fund to the Possible Identity Theft.
(iv) PNC will (A) engage an independent auditing firm or other similar firm of independent
examiners to conduct an annual testing of the Controls and issue a report on the results of
the testing (the “Audit Report”), and (B) furnish a copy of the Audit Report to the Fund;
and
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(v) Upon Fund request, issue a certification in a form determined to be appropriate
by PNC in its reasonable discretion, certifying to PNC’s continuing compliance with the
Controls after the date of the most recent Audit Report.
(b) The Fund agrees it is responsible for complying with and determining the applicability to
the Fund of Section 114
of the Fair and Accurate Credit Transaction Act of 2003 and regulations promulgated thereunder
by the Federal Trade
Commission (the “Red Flag Requirements”), for determining the extent to which the Red Flag
Services assist the Fund
in complying with the Red Flag Requirements, and for furnishing any supplementation or
augmentation to the Red
Flag Services it determines to be appropriate, and that PNC has given no advice and makes no
representations with
respect to such matters. This Red Flag Section shall not be interpreted in any manner which
imposes a duty on PNC to
act on behalf of the Fund or otherwise, including any duty to take any action upon the
occurrence of a Red Flag, other
than as expressly provided for in this Red Flag Section. The Controls and the Red Flag Services
may be changed at
any time and from time to time by PNC in its reasonable sole discretion to include commercially
reasonable provisions
appropriate to the Red Flag Requirements, as they may be constituted from time to time. The Fund
shall be obligated
to pay, and PNC shall be entitled to receive, the fee for Red Flag Services as established by
PNC from time to time by
prior written notice. Other than the initial fee which shall be payable as of the Effective
Date, the Fund shall be
obligated to pay any revised fee commencing thirty (30) days after the Fund’s receipt of such
written notice. The
Fund’s sole remedy in the event it does not agree to a revised fee is to terminate the Red Flag
Services for future
services.
(c) Notwithstanding any other provision of the Agreement, in the event of a material breach of
this Red Flag Section
by PNC, the Fund shall be entitled exclusively to terminate the Red Flag Services by complying
with the notice and
cure period provisions in the Agreement applicable to a material breach of the Agreement, but
shall not be entitled to
terminate the Agreement. For purposes of clarification: The foregoing provision is not intended
to restrict, modify or
abrogate any remedy available to a Fund for a breach of the Red Flags Section by PNC other than
the termination
remedy.
2. Remainder of Existing Agreement; Governing Law. Except as specifically modified by this
Amendment, all terms and
conditions of the Existing Agreement shall remain in full force and effect. The governing law of
the Agreement shall be
the governing law of this Amendment.
3. Entire Agreement: Facsimile Signatures: Counterparts. This Amendment constitutes the
final, complete, exclusive and
fully integrated record of the agreement of the parties with respect to the subject matter herein
and the amendment of the
Existing Agreement with respect to such subject matter. This Amendment may be executed in one or
more counterparts;
such execution of counterparts may occur by manual signature, facsimile signature, manual signature
transmitted by means
of facsimile transmission or manual signature contained in an imaged document attached to an email
transmission; and each
such counterpart executed in accordance with the foregoing shall be deemed an original, with all
such counterparts together
constituting one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed by their duly
authorized officers, as of the day and year first above written.
| PNC Global Investment Servicing (U.S.) Inc. | Meridian Fund, Inc. | |||||||||
By:
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/s/ Xxxxxxx XxXxxxxx | By: | /s/ Xxxxx X. Xxxxxxx | |||||||
|
|
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Name:
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Xxxxxxx XxXxxxxx | Name: | Xxxxx X. Xxxxxxx | |||||||
Title:
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Executive Vice President, Senior Managing Director
|
Title: | CFO/CCO
|
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RED FLAG SERVICES FEE AGREEMENT
The Red Flags Services Amendment (“Amendment”) is being entered into as of May 7, 2009
(“Effective Date”), by and between PNC Global Investment Servicing (U.S.) Inc. (“PNC”) and the
undersigned investment company (the “Fund”) and amends the agreement between PNC and the Fund
pursuant to which PNC provides transfer agency services to the Fund, as amended to date (“Existing
Agreement”).
IN CONSIDERATION of the services to be provided by PNC as fully described in the
amendment, the Funds agree to the fees as set forth below:
For Funds paying a 4% regulatory surcharge:
|
The Red Flag Service Fee is WAIVED |
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed by their duly
authorized officers, as of the day and year first above written.
| PNC Global Investment Servicing (U.S.) Inc. | Meridian Fund, Inc. | |||||||||
By:
|
/s/ Xxxxxxx XxXxxxxx | By: | /s/ Xxxxx X. Xxxxxxx | |||||||
|
|
|
|||||||||
Name:
|
Xxxxxxx XxXxxxxx | Name: | Xxxxx X. Xxxxxxx | |||||||
Title:
|
Executive Vice President, Senior Managing Director
|
Title: | CFO/CCO
|
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