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EXHIBIT (8)(b)
TRANSFER AGENCY AND SERVICE AGREEMENT
AGREEMENT made as of the 23rd day of April, 1996 by and between THE
EXPLORER INSTITUTIONAL TRUST which is organized under the laws of the State of
Massachusetts (the "Trust") and has its principal office and place of business
at Oakbrook Terrace, Illinois, acting on behalf of its series listed on Schedule
"A" hereto (collectively, the "Funds" and each a "Fund"), and ACCESS INVESTOR
SERVICES, INC., a Massachusetts corporation, having its principal office at
Houston, Texas, and its principal place of business at Kansas City, Missouri
("ACCESS").
RECITAL:
WHEREAS, the Trust desires to appoint ACCESS as its transfer agent,
dividend disbursing agent and shareholder service agent for the Funds, and
ACCESS desires to accept such appointments;
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, the parties hereto agree as follows:
ARTICLE 1. TERMS OF APPOINTMENT; DUTIES OF ACCESS.
1.01 Subject to the terms and conditions set forth in this Agreement,
the Trust hereby employs and appoints ACCESS as transfer agent, dividend
disbursing agent and shareholder service agent for the Funds.
1.02 ACCESS hereby accepts such employment and appointments and
agrees that on and after the effective date of this Agreement it will act as the
transfer agent, dividend disbursing agent and shareholder service agent for the
Funds on the terms and conditions set forth herein.
1.03 ACCESS agrees that its duties and obligations hereunder will be
performed in a competent, efficient and workmanlike manner with due diligence in
accordance with reasonable industry practice, and that the necessary facilities,
equipment and personnel for such performance will be provided.
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1.04 In order to assure compliance with section 1.03 and to implement
a cooperative effort to improve the quality of transfer agency and shareholder
services received by the Funds and their shareholders, ACCESS agrees to provide
and maintain quantitative performance objectives, including maximum target
turn-around times and maximum target error rates, for the various services
provided hereunder. ACCESS also agrees to provide a reporting system designed
to provide the Board of Trustees of the Trust (the "Board") on a quarterly basis
with quantitative data comparing actual performance for the period with the
performance objectives. The foregoing procedures are designed to provide a
basis for continuing monitoring by the Board of the quality of services rendered
hereunder.
ARTICLE 2. FEES AND EXPENSES.
2.01 For the services to be performed by ACCESS pursuant to this
Agreement, the Funds agree to pay ACCESS the fees provided in the fee schedules
agreed upon from time to time by the Funds and ACCESS.
2.02 In addition to the amounts paid under section 2.01 above, each
Fund agrees to reimburse ACCESS promptly for the Fund's reasonable out-of-pocket
expenses or advances paid on its behalf by ACCESS in connection with its
performance under this Agreement for postage, freight, envelopes, checks,
drafts, continuous forms, reports and statements, telephone, telegraph, costs of
outside mailing firms, necessary outside record storage costs, media for storage
of records (e.g., microfilm, microfiche and computer tapes) and printing costs
incurred due to special requirements of the Fund. In addition, any other
special out-of-pocket expenses paid by ACCESS at the specific request of the
Fund will be promptly reimbursed by the Fund. Postage for mailings of
dividends, proxies, Fund reports and other mailings to all shareholder accounts
shall be advanced to ACCESS by the Fund three business days prior to the mailing
date of such materials.
ARTICLE 3. REPRESENTATIONS AND WARRANTIES OF ACCESS.
3.01 It is a corporation duly organized and existing and in good
standing under the laws of the State of Massachusetts.
3.02 It is duly qualified to carry on its business in the states of
Texas and Maryland.
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3.03 It is empowered under applicable laws and by its charter and
by-laws to enter into and perform this Agreement.
3.04 All requisite corporate proceedings have been taken to authorize
it to enter into and perform this Agreement.
3.05 It has and will continue to have during the term of this
Agreement access to the necessary facilities, equipment and personnel to perform
its duties and obligations hereunder.
3.06 It will maintain a system regarding "as of" transactions as
follows:
(a) Each "as of" transaction effected at a price other than
that in effect on the day of processing for which an estimate has not
been given to the Fund and which is necessitated by ACCESS' error, or
delay for which ACCESS is responsible or which could have been avoided
through the exercise of reasonable care, will be identified, and the net
effect of such transactions determined, on a daily basis for a Fund.
(b) The cumulative net effect of the transactions included in
paragraph (a) above will be determined each day throughout each month.
If, on any day during the month, the cumulative net effect upon the Fund
is negative and exceeds an amount equivalent to 1/2 of 1 cent per share
of the Fund, ACCESS shall promptly make a payment to the Fund (in cash
or through use of a credit as described in paragraph (c) below) in such
amount as necessary to reduce the negative cumulative net effect to less
than 1/2 of 1 cent per share of the Fund. If on the last business day of
the month the cumulative net effect (adjusted by the amount of any
payments pursuant to the preceding sentence) upon the Fund is negative,
the Fund shall be entitled to a reduction in the monthly transfer agency
fee next payable by an equivalent amount, except as provided in
paragraph (c) below. If on the last business day of the month the
cumulative net effect (similarly adjusted) upon the Fund is positive,
ACCESS shall be entitled to recover certain past payments and reductions
in fees, and to a credit against all future payments and fee reductions
made under this paragraph to the Fund, as describe in paragraph (c)
below.
(c) At the end of each month, any positive cumulative net
effect upon the Fund shall be deemed to be a credit to ACCESS which
shall first be applied to recover any payments and fee reductions made
by ACCESS to the Fund under paragraph (b) above during the calendar
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year by increasing the amount of the monthly transfer agency fee next
payable in an amount equal to prior payments and fee reductions made
during such year, but not exceeding the sum of that month's credit and
credits arising in prior months during such year to the extent such
prior credits have not previously been utilized as contemplated by this
paragraph (c). Any portion of a credit to ACCESS not so used shall
remain as a credit to be used as payment against the amount of any
future negative cumulative net effects that would otherwise require a
payment or fee reduction to the Fund pursuant to paragraph (b) above.
ARTICLE 4. REPRESENTATIONS AND WARRANTIES OF THE TRUST.
The Trust hereby represents and warrants that:
4.01 It is duly organized and existing and in good standing under
the laws of the State of Massachusetts.
4.02 It is empowered under applicable laws and regulations and by its
Agreement and Declaration of Trust and by-laws to enter into and perform this
Agreement.
4.03 All requisite proceedings have been taken by its Board to
authorize it to enter into and perform this Agreement.
4.04 It is an open-end, management investment company registered
under the Investment Company Act of 1940, as amended.
4.05 A registration statement under the Securities Act of 1933, as
amended, is currently effective and will remain effective, and appropriate state
securities laws filings have been made and will continue to be made, with
respect to all of its shares being offered for sale.
ARTICLE 5. INDEMNIFICATION.
5.01 ACCESS shall not be responsible for and the Funds shall
indemnify and hold ACCESS harmless from and against any and all losses, damages,
costs, charges, reasonable counsel fees, payments, expenses and liabilities
arising out of or attributable to:
(a) All actions of ACCESS required to be taken by ACCESS for
the benefit of the Fund pursuant to this Agreement, provided ACCESS has
acted in good faith with due diligence and without negligence or willful
misconduct.
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(b) The reasonable reliance by ACCESS on, or reasonable
use by ACCESS of, information, records and documents which have been
prepared or maintained by or on behalf of the Fund have been furnished
to ACCESS by or on behalf of the Fund.
(c) The reasonable reliance on ACCESS on, or the carrying
out be ACCESS of, any instructions or requests of the Fund.
(d) The offer or sale of the Fund's shares in violation of
any requirement under the federal securities laws or regulations or the
securities laws or regulations of any state or in violation of any stop
order or other determination or ruling by any federal agency or any
state with respect to the offer or sale of such shares in such state
unless such violation results from any failure by ACCESS to comply with
written instructions of the Fund that no offers or sales of the Fund's
shares be made in general or to the residents of a particular state.
(e) The Fund's refusal or failure to comply with the terms
of this Agreement, or the Fund's lack of good faith, negligence or
willful misconduct or the breach of any representation or warranty of
the Fund hereunder.
5.02 ACCESS shall indemnify and hold the Funds harmless from and
against any and all losses, damages, costs, charges, reasonable counsel fees,
payments, expenses and liability arising out of or attributable to ACCESS'
refusal or failure to comply with the terms of this Agreement, or ACCESS' lack
of good faith, negligence or willful misconduct, or the breach of any
representation or warranty of ACCESS hereunder.
5.03 At any time ACCESS may apply to any authorized officer of a Fund
for instructions, and may consult with the Fund's legal counsel, at the expense
of the Fund, with respect to any matter arising in connection with the services
to be performed by ACCESS under this Agreement, and ACCESS shall not be liable
and shall be indemnified by the Fund for any action taken or omitted by it in
good faith in reasonable reliance upon such instructions or upon the opinion of
such counsel. ACCESS shall be protected and indemnified in acting upon any
paper or document reasonably believed by ACCESS to be genuine and to have been
signed by the proper person or persons and shall not be held to have notice of
any change of authority of any person, until receipt of written notice thereof
from the Fund. ACCESS shall also be protected and indemnified in recognizing
stock certificates which ACCESS reasonably
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believe to bear the proper manual or facsimile signatures of the officers of the
Fund, and the proper countersignature of any former transfer agent or registrar,
or of a co-transfer agent or co-registrar.
5.04 In the event any party is unable to perform its obligations
under the terms of this Agreement because of acts of God, strikes, equipment, or
transmission failure or damage, or other causes reasonably beyond its control,
such party shall not be liable for damages to the other for any damages
resulting from such failure to perform or otherwise from such causes.
5.05 In no event and under no circumstances shall any party to this
Agreement be liable to another party for consequential damages under any
provision of this Agreement or for any act or failure to act hereunder.
5.06 In order that the indemnification provisions contained in this
Article 5 shall apply, upon the assertion of a claim for which one party may be
required to indemnify another, the party seeking indemnification shall
developments concerning such claim. The party who may be required to indemnify
shall have the option to participate with the party seeking indemnification in
the defense of such claim. The party seeking indemnification shall in no case
confess any claim or make any compromise in any case in which the other party
may be required to indemnify it except with the other party's prior written
consent.
ARTICLE 6. COVENANTS OF THE TRUST AND ACCESS.
6.01 The Trust shall promptly furnish to ACCESS the following:
(a) Certified copies of the resolution of its Board
authorizing the appointment of ACCESS and the execution and delivery of this
Agreement.
(b) Certified copies of its Agreement and Declaration of
Trust and by-laws and all amendments thereto.
6.02 ACCESS hereby agrees to maintain facilities and procedures
reasonably acceptable to the Funds for safekeeping of share certificates, check
forms and facsimile signature imprinting devices, if any; and for the
preparation or use, and for keeping account of, such certificates, forms and
devices.
6.03 ACCESS shall keep records relating to the services to be
performed hereunder, in the form and manner as it may deem advisable; provided,
however, that all accounts, books and other
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records of the Funds (hereinafter referred to as "Fund Records") prepared or
maintained by ACCESS prepared or maintained by ACCESS hereunder shall be
maintained and kept current in compliance with Section 31 of the Investment
Company Act of 1940 and the Rules thereunder (such Section and Rules being
hereinafter referred to as the "1940 Act Requirements"). To the extent required
by the 1940 Act Requirements, ACCESS agrees that all Fund Records prepared or
maintained by ACCESS hereunder are the property of the Fund and shall be
preserved and made available in accordance with the 1940 Act Requirements, and
shall be surrendered promptly to a Fund on its request. ACCESS agrees at such
reasonable times as may be requested by the Board and at least quarterly to
provide (i) written confirmation to the Board that all Fund Records are
maintained and kept current in accordance with the 1940 Act Requirements, and
(ii) such other reports regarding its performance hereunder as may be reasonably
requested by the Board.
6.04 ACCESS and the Funds agree that all books, records, information
and data pertaining to the business of the other party which are exchanged or
received pursuant to the negotiation or the carrying out of this Agreement shall
remain confidential, and shall mot be voluntarily disclosed to any other person,
except as may be required by law.
6.05 In case of any requests or demands for the inspection of any of
the Fund Records, ACCESS will endeavor to notify the Fund and to secure
instructions from an authorized officer of the Fund as to such inspection.
ACCESS reserves the right, however, to exhibit such Fund Records to any person
whenever it is advised by its counsel that it may be held liable for the failure
to exhibit such Fund Records to such person.
ARTICLE 7. TERM AND TERMINATION OF AGREEMENT.
7.01 This Agreement shall remain in effect from the date hereof
through December 31, 1997; provided, however, that this Agreement may be
terminated by any party with respect to that party for good and reasonable cause
at any time by giving written notice to the other party at least 120 days prior
to the date on which such termination is to be effective. Any unpaid fees or
reimbursable expenses payable to ACCESS shall be due on any such termination
date. ACCESS agrees to use its best efforts to cooperate with the Trust and the
successor transfer agent or agents in accomplishing an orderly transition.
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7.02 Subject to the prior approval of the Board, this Agreement shall
be renewed and extended for periods of not more than one year each, unless and
until this Agreement is terminated in accordance with section 7.01 above.
ARTICLE 8. MISCELLANEOUS.
8.01 Except as provided in section 8.03 below, neither this Agreement
nor any rights or obligations hereunder may be assigned by any party without the
written consent of ACCESS or the Trust, as the case may be; provided, however,
that no consent shall be required for any merger of a Fund with, or any sale of
all or substantially all the assets of a Fund to, another investment company.
8.02 The Agreement shall inure to the benefit of and be binding upon
the parties and their respective permitted successors and assigns.
8.03 ACCESS may, without further consent on the part of a Fund,
subcontract with DST, Inc., a Missouri corporation, or any other qualified
servicer, for the performance of data processing activities; provided, however,
that ACCESS shall be as fully responsible to the Fund for the acts and omissions
of DST, Inc., or other qualified servicer, as it is for its own acts and
omissions.
8.04 ACCESS may, without further consent on the part of a Fund,
provide services to its affiliated companies. Such services may be provided at
cost.
8.05 The Agreement constitutes the entire agreement between the
parties hereto with respect to the subject matter hereof, and supersedes any
prior agreement with respect thereto, whether oral or written, and this
Agreement may not be modified except by written instrument executed by the
affected parties.
8.06 The execution of this Agreement has been authorized by the
Trust's Trustees. This Agreement is executed on behalf of the Trust's or the
Trustees of the Trust's as Trustees and not individually and the obligations of
this Agreement are not binding upon any of the Trustees, officers or
shareholders of the Trust's individually but are binding only upon the assets
and property of the Trust's. An Agreement and Declaration of Trust in respect
of the Trust's is on file with the Secretary of State of Massachusetts.
8.07 In the event of a change in the business or regulatory
environment affecting all or any portion of this Agreement, the parties hereto
agree to renegotiate such affected portions in good faith.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in their names and on their behalf and through their duly authorized
officers, as of the date first above written.
THE EXPLORER INSTITUTIONAL TRUST
BY: /s/ Xxxxxx X. XxXxxxxxx
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NAME: Xxxxxx X. XxXxxxxxx
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ITS: President
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ATTEST:
/s/ Xxxxxxxx Xxxxxxx
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Assistant Secretary
ACCESS INVESTOR SERVICES, INC.
BY: /s/ Xxxx Xxxxxxxxxx
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Xxxx X. Xxxxxxxxxx, President and
Chief Executive Officer
ATTEST:
/s/ Xxxxxxxx Xxxxxxx
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Assistant Secretary
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PRICING SCHEDULE
FUND NAME ANNUAL CHARGE(1)
The Explorer Institutional Active Core Fund $15,000 Plus Out of Pockets
The Explorer Institutional Limited Duration Fund $15,000 Plus Out of Pockets
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(1) Minimum annual charge based on reimbursement, profit margin expense not
applied.
New funds, when added, will have an annual charge of $15,000 after a six
months zero fee grace period.
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