SERVICES AMENDMENT
SERVICES AMENDMENT
March 23,
2004
State Street Navigator Securities Lending Trust
State Street Financial Center
Attention: Securities Finance
Xxx Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
State Street Financial Center
Attention: Securities Finance
Xxx Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Dear Sir or Madam:
State Street Navigator Securities Lending Trust (the “Fund”) and State Street Bank and Trust
Company (the “Transfer Agent”) are parties to an agreement dated as of March 4, 1996 (the
“Agreement”) under which the Transfer Agent performs certain transfer agency and/or recordkeeping
services for the Fund. In connection with the enactment of the Uniting and Strengthening America
by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (“USA
PATRIOT Act”) and the regulations promulgated thereunder, (collectively, the “Patriot Act”), the
Fund has requested and the Transfer Agent has agreed to amend the Agreement as of the date hereof
in the manner set forth below:
WHEREAS, Section 326 of the USA PATRIOT Act (the “Patriot Act”) and final rules adopted by the
Department of the Treasury’s Financial Crimes Enforcement Network (the “Rules”) require the Fund
to develop and implement an anti-money laundering program, which among other things, is designed
to verify the identity of any person opening an account, determine whether such person appears on
lists of known or suspected terrorists or terrorist organizations and identify and report unusual
and suspicious account activity to regulators;
WHEREAS, the Patriot Act authorizes a mutual fund to delegate to a service provider, including its
transfer agent, the implementation and operation of certain aspects of the Fund’s anti-money
laundering program; and
WHEREAS, in order to assist its transfer agent clients with their customer identification
compliance responsibilities under the Patriot Act and the Rules, the Transfer Agent has provided to
the Fund for its consideration and approval written procedures describing various tools designed to
assist in the (i) verification of persons opening accounts with the Fund and determination of
whether such persons appear on any list of known or suspected terrorists or terrorist
organizations, and (ii) identifying and reporting of unusual and suspicious activity in connection
with accounts opened with the Fund. The Fund has, after review, selected various procedures to
comply with its customer identification and suspicious activity monitoring program and its
obligations under the Patriot Act and the Rules (the “Program”); and
WHEREAS, the Fund recognizes the importance of complying with the Patriot Act and desires to
implement its procedures as part of its overall anti-money laundering program and, subject to
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the terms of the Rules, delegate to the Transfer Agent the day-to-day operation of certain of its
procedures on behalf of the Fund.
NOW THEREFORE, in consideration of the foregoing and the mutual covenants and agreements
hereinafter contained, the parties hereby agree to amend the Agreement, pursuant to the terms
thereof, as follows:
1. Delegation; Duties.
1.1 Subject to the terms and conditions set forth in the Agreement, the Fund hereby
instructs and directs the Transfer Agent to implement the procedures on its behalf as set
forth on
Exhibit A, which is attached to and made a part of, this Agreement (the “Procedures”). Exhibit
A may be amended, from time to time, by the Transfer Agent in writing to the Fund with at least
30 days prior notice of such effective change.
1.2 The Transfer Agent agrees to perform such delegated Procedures, with respect to
the ownership of shares in the Fund(s) set forth in Exhibit B for which the Transfer Agent
maintains the applicable shareholder information, subject to and in accordance with the terms
and conditions of the Agreement. Exhibit B, which is attached to and made a part of, this
Agreement, may be amended from time to time by mutual agreement of the parties upon the
execution by both parties of a revised Exhibit B.
1.3 The Fund acknowledges that it has had an opportunity to review, consider and
comment upon and select the Procedures and the Fund has determined that they, as part of the
Fund’s overall anti-money laundering Program, are reasonably designed to prevent the Fund
from being used for money laundering or the financing of terrorist activities and to achieve
compliance with the applicable provisions of the Patriot Act, Bank Secrecy Act and their
implementing regulations thereunder, which compliance the Fund acknowledges to be its
responsibility. Notwithstanding anything to the contrary contained in this Agreement, in no
event shall the Transfer Agent be obligated to file with any regulator, on behalf of the Fund,
any
requisite forms or other information in connection with the Program. Any filing by the
Transfer
Agent shall be in its own name and on its own behalf. The Fund shall be responsible for
complying with any and all requisite regulatory filings which arise as a result of the
Procedures
or Program generally.
1.4 Except as otherwise expressly stated in this Agreement, the Transfer Agent makes
no representation or warranty, either express, implied or statutory, concerning the Procedures
herein. The Fund expressly confirms that it has not relied upon any representation by the
Transfer Agent as a basis for entering into this Amendment. The provisions of this §1.4 shall
survive the termination of this Amendment.
2. Consent to Examination. In connection with the performance by the Transfer Agent of
the Procedures, the Transfer Agent understands and acknowledges that the Fund remains
responsible for assuring compliance with the Patriot Act and that the records the Transfer Agent
maintains for the Fund relating to the Fund’s Program may be subject, from time to time, to
examination and/or inspection by federal regulators in order that the regulators may evaluate
such compliance. The Fund hereby directs, and the Transfer Agent acknowledges, that the
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Transfer Agent shall (1) permit federal regulators access to such information and records
maintained by the Transfer Agent and relating to the Transfer Agent’ implementation of the
Procedures on behalf of the Fund, as they may request, and (2) permit such federal regulators to
inspect the Transfer Agent’ implementation of the Procedures on behalf of the Fund. The Transfer
Agent hereby consents to such examination and/or inspection and agrees to cooperate with such
federal examiners in connection with their review. For purposes of such examination and/or
inspection, the Transfer Agent will use its best efforts to make available, during normal business
hours, all required records and information for review by such examiners.
3. Limitation on Delegation.
3.1
The Fund acknowledges and agrees that in accepting the delegation hereunder, the Transfer Agent is agreeing to perform only those aspects of the Fund’s Program that have been
expressly delegated as part of the Procedures and is not undertaking and shall not be
responsible
for any other aspect of the Fund’s Program or for the overall compliance by the Fund with the
Patriot Act. Additionally, the parties acknowledge and agree that the Transfer Agent shall
only
be responsible for performing the Procedures with respect to the ownership of shares in the
Fund
for which the Transfer Agent maintains the applicable shareholder information.
3.2 The Fund also acknowledges and agrees that the Transfer Agent’s provision of the
Procedures hereunder is dependent upon the receipt by the Transfer Agent of certain services
from third parties. In the event services from any such third party becomes unavailable, the
Transfer Agent shall use reasonable efforts to obtain equivalent services from an alternative
provider or may, in its discretion, discontinue the delegated duties upon such prior notice to
the
Fund as may be reasonably practicable. Notwithstanding anything to the contrary contained
herein, the Transfer Agent will have no liability for the performance or nonperformance of any such third party except to the extent the Transfer Agent failed to exercise the same care in its selection of such third party as the Transfer Agent exercises in the conduct of its own operations.
herein, the Transfer Agent will have no liability for the performance or nonperformance of any such third party except to the extent the Transfer Agent failed to exercise the same care in its selection of such third party as the Transfer Agent exercises in the conduct of its own operations.
4. Reports. The Transfer Agent agrees to provide to the Fund (i) any reports received by
the
Transfer Agent from any government agency pertaining to the Transfer Agent’s anti-money
laundering monitoring on behalf of the Fund as provided in this AmendmentAgreement, (ii) any
action taken in response to anti-money laundering violations as described in (i), and (iii) an
annual report of its verification activities on behalf of the Fund. The Transfer Agent shall
provide such other reports on the verification activities conducted at the direction of the Fund as
may be agreed to from time to time by the Transfer Agent and the Fund.
5. Fees & Expenses.
5.1 In consideration of the performance of the foregoing duties, the Fund agrees on behalf of
each of the Funds to pay the Transfer Agent a fee for each Shareholder account as set out in the
Fee Schedule which is attached to, and made a part of, this Agreement. Such fees and out-of-pocket
expenses and advances identified in §5.2 below may be changed from time to time subject to mutual
written agreement between the Fund and the Transfer Agent.
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5.2 In addition to such fees paid under §5.1 above, the Fund agrees on behalf of each of the
Portfolios to reimburse the Transfer Agent for the reasonable administrative expenses that may be
associated with such additional duties including, but not limited to, confirmation production,
postage, forms, telephone, microfilm, microfiche, records storage, or advances incurred by the
Transfer Agent for the items set forth in the fee schedule attached hereto. The terms of the
Agreement shall apply with respect to the payment of such expenses in the same manner and to the
same extent as any other expenses incurred under the Agreement.
6. Reliance on Information and Authenticity. The Fund hereby acknowledges and
understands that the Transfer Agent’s ability to perform the Procedures under the terms and
conditions set forth in this Agreement is contingent upon the Fund’s ongoing cooperation with
the Transfer Agent. The Fund shall use all reasonable efforts in good faith to cooperate with the
Transfer Agent taking all action in a timely manner which the Transfer Agent, in its reasonable
opinion, deems necessary to enable or assist the Transfer Agent in performing any of the
Procedures under this Agreement, including but not limited to, providing, or causing to be
provided, to the Transfer Agent any information or documents which the Transfer Agent deems
reasonable or appropriate to provide the duties hereunder. The Transfer Agent shall, when
performing hereunder, be entitled to rely upon (i) the accuracy of information, data and
authorizations received from the Fund or any Shareholder, and (ii) the authenticity of any
representation purporting to be from, or signature purporting to be of, the Fund or a Shareholder.
In no event shall the Transfer Agent be liable in any way for any losses, penalties, expenses or
other harm or injury which may arise in connection with the Transfer Agent’s delay in
establishing, or refusal to establish, a shareholder account as a result of the Transfer Agent’s
failure to receive in a timely manner an application to open such account which, in the Transfer
Agent’s sole discretion, it deems complete.
7. Miscellaneous.
7.1 Except as set forth herein, the terms and provisions of the Agreement shall remain
unchanged and continue to apply with full force and effect. Except as otherwise defined
herein,
all capitalized terms used in this Amendment shall have the same meaning as set forth in the
Agreement.
7.2 The parties to this Agreement understand and acknowledge that the Transfer
Agent shall act on behalf of and as agent for the Fund with respect to the Procedures set
forth in
Exhibit A. In no event shall the Transfer Agent be liable for its failure to perform under
the
terms of this Amendment or any Exhibit, except where the Transfer Agent has acted with
negligence or willful misconduct. This Agreement shall not be deemed to constitute the Fund
and the Transfer Agent as partners or joint ventures.
7.3
The Fund shall indemnify and hold harmless the Transfer Agent from and against any and all losses, penalties, expenses or other harm or injury which the Transfer Agent may
incur or suffer or which may be asserted by any person or entity, including reasonable
attorneys’
fees and court costs arising out of (i) any failure by the Fund to observe and perform
properly
each and every covenant of this Agreement or any other wrongdoing of the Fund, or (ii) any
action taken or omitted to be taken by the Transfer Agent in reasonable reliance upon
information provided to the Transfer Agent by the Fund; provided, however, that the Fund shall
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not be required to indemnify and hold harmless the Transfer Agent from any losses which are caused
by the Transfer Agent’s negligence. The provisions of §6 shall survive the termination of this
Amendment.
7.4 In the event that the Transfer Agent, in its sole judgment, believes that its
performance of any duty set forth herein may create a risk of financial, reputation or other
loss
for it, the Transfer Agent may, upon notice to the Fund, suspend its performance of the
Procedures; provided, however, that if the Fund takes such action as may be requested by the Transfer Agent to eliminate such risk, the Transfer Agent shall not suspend the Procedures, or, if the Procedures have been suspended, shall reinstate its provision of the Procedures.
Procedures; provided, however, that if the Fund takes such action as may be requested by the Transfer Agent to eliminate such risk, the Transfer Agent shall not suspend the Procedures, or, if the Procedures have been suspended, shall reinstate its provision of the Procedures.
7.5 Each party represents to the other that the execution and delivery of this
Amendment has been duly authorized.
IN WITNESS WHEREOF, each of the parties has caused this Amendment to be executed in its name
and behalf by its duly authorized representative as of the date first above written.
| WITNESSED BY: | STATE STREET BANK AND TRUST COMPANY | |||||||||||||
| /s/ Xxxxx Xxxxx | By: | /s/ Xxxxxx Xxxxxxx | ||||||||||||
| Name: | Xxxxxx Xxxxxxx | |||||||||||||
| Title: | SVP | |||||||||||||
| WITNESSED BY: | STATE STREET NAVIGATOR SECURITIES | |||||||||||||
| LENDING TRUST | ||||||||||||||
| /s/ Xxxxx Xxxxx | By: | /s/ Xxxxx Xxxxxxx | ||||||||||||
Name:
|
Xxxxx Xxxxx | Name: | Xxxxx Xxxxxxx | |||||||||||
Title:
|
Counsel | Title: | VP | |||||||||||
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Exhibit A
Procedures
Procedures
The Transfer Agent agrees to perform the duties set forth below, with respect to the ownership of
shares in the Fund(s) set forth in Exhibit B for which the Transfer Agent maintains the applicable
account shareholder information, subject to and in accordance with the terms and conditions of
this Agreement.
I. Requests for New Account
Upon receipt from the Fund of an application to establish an account in the name of one of its
shareholders, the Transfer Agent shall review it for completeness. The Transfer Agent shall deem
the application complete as to the shareholder or any authorized signers or beneficiaries on the
account if with respect to such entity (i) the application includes such entity’s name, U.S.
resident street address, social security number and date of birth or (ii) the Fund (a) certifies
to the Transfer Agent as to the successful verification of the identity of such entity and the
manner in which the Fund verified such identity, and (b) provides the detailed information so
verified (i.e. passport number, drivers license number, birth certificate, etc.) which, in the
Transfer’s Agent’s opinion, fulfills applicable regulatory requirements.
If the application is incomplete as to the shareholder, the Transfer Agent will not open the
account and will notify the Fund and request additional information from the Fund. If the Fund
fails to provide the necessary shareholder information to complete the application within two
business days of the Transfer Agent’s request, the Transfer Agent shall promptly return the
application as incomplete and return any funds earmarked for deposit in such account to the
shareholder, unless upon receipt of the Transfer Agent’s request, the Fund requests additional
time to provide the missing information in which such application and funds will be returned to
the shareholder if the missing information is not provided within five (5) business days of the
Transfer Agent’s request. If the Transfer Agent determines, in its sole discretion, that the
shareholder information has been completed within a timely manner, the Transfer Agent shall
establish the account; provided, however, that such account shall be restricted from any
and all redemption transactions unless and until such restriction is lifted by the Transfer Agent
in accordance with the terms below.
If the shareholder information is complete but the application is incomplete as to any authorized
signer and/or beneficiary, the Transfer Agent will open the account and restrict such account from
any redemption transactions with respect to such entity unless and until such restriction is
lifted by the Transfer Agent in accordance with the terms below.
The Transfer Agent may file a Suspicious Activity Report or other appropriate report on its own
behalf with applicable regulator(s) if in attempting to collect any requisite information it deems
such action necessary or appropriate.
The trade date for the purchase of shares on a newly established account shall be the date on which
the Transfer Agent deems the application complete as to shareholder information.
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II. Screening Against the Blocked Persons and Other Restricted Lists
Newly Established Accounts
Once the application is deemed complete by the Transfer Agent and the account is established, the
Transfer Agent will scan the application into a database, inputting the name and address of the
shareholder and any authorized signer(s) and beneficiar(ies) on the account and shall compare it
against the published lists set forth in Exhibit C, and such other lists as the Transfer Agent may
utilize, in an effort to determine whether or not such entity is named on any of the said lists
(if so, a so-called “Positive Match”).
Such scanning will result in a report of potential matches (the “Exception Report”), which may or
may not include a Positive Match. If, upon review of the Exception Report and any information
available to it, the Transfer Agent determines in its sole discretion that any potential match(es)
is not a valid Positive Match, then such match will be deemed a False Match and the Transfer Agent
shall so document to the file without reporting it to the Fund. If the Transfer Agent believes a
potential match is a Positive Match or requires additional information to make a determination,
then such match will be reported to the Fund. If additional information is provided by the Fund,
the Transfer Agent will make any necessary corrections and will re-evaluate such “match” by
re-scanning the updated information. If the Transfer Agent determines, in its sole discretion,
that a Positive Match exists or that it is unable to determine with reasonable certainty that no
Positive Match exists, the Transfer Agent will notify the Fund and provide supporting
documentation. It also will file the appropriate report(s) on its own behalf with the applicable
regulators and comply with instructions of appropriate regulator(s) which may include, without
limitation, freezing the account and its assets, refusing to add an authorized signer or
beneficiary to the account, and/or closing the account.
If the Transfer Agent determines, in its sole discretion, that no Positive Match exists on items
reported, the Transfer Agent will notify the Fund and document its review. If the Fund, in its
sole discretion, believes that a Positive Match does exist, the Transfer Agent will take
instructions from the Fund, subject to any regulatory limitations, and will document its files.
Existing Accounts
Each month, or as otherwise agreed to by the parties, the Transfer Agent shall scan the
shareholder’s name and that of each authorized signer and beneficiary on existing accounts in an
effort to identify whether or not a Positive Match exists, in which case the Transfer Agent and
Fund shall act in accordance with the applicable terms above.
The Transfer Agent will retain records of scanning function and results, in accordance with
applicable Bank Secrecy Act regulation(s).
III. Identity Verification
Upon receipt of a complete application, as described in Section I above to establish an account or
add an authorized signer or beneficiary, the Transfer Agent will attempt to verify the identity of
the shareholder and its authorized signers and/or beneficiaries, as applicable. The extent and
nature of
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the information needed by the Transfer Agent to perform such verification shall depend upon the
nature of the accountholder, authorized signer or beneficiary (e.g. corporation, individual,
trust, non-U.S. resident) but shall at a minimum include, without limitation, the entity’s name,
U.S. street address, social security number and, if applicable, date of birth. The Transfer Agent
shall deem the identity verified, as to the shareholder or any authorized signers or beneficiaries
on the account, if (i) such entity’s name, U.S. resident street address, social security number
and date of birth matches information in the database utilized by the Transfer Agent or (ii) the
Fund, to the Transfer Agent’s reasonable satisfaction, (a) certifies to the successful
verification by the Fund of the identity of such entity and the manner in which the Fund verified
such identity, and (b) provides copies of the detailed information verified (i.e. passport number,
drivers license number, birth certificate, etc.) which, in the Transfer’s Agent’s opinion,
fulfills applicable regulatory requirements. Examples of acceptable documentary evidence, as
agreed upon by the parties, include driver’s license, military driver’s license or other military
identification card, alien registration card, birth certificate identification card issued by a
state within the last 6 months, certified copy of a court order with full name and date of birth,
and passport.
The Transfer Agent also shall attempt to so verify the identity of any authorized signer or
beneficiary which the Fund and/or shareholder requests to be added to any existing account
established after October 1,2003.
In cases where the Fund has not certified to the entity’s identity as described above and the
Transfer Agent is unable to verify such information, the Transfer Agent shall so notify the Fund,
furnish supporting documentation to it and request that additional evidence or such certification
from the Fund.
In cases where the shareholder’s identity cannot be verified by the Transfer Agent and the Fund
has failed to provide a certification with respect to the shareholder’s identity to the Transfer
Agent’s reasonable satisfaction, the Transfer Agent, in its sole discretion or upon the Fund’s
request, may close the account. If it is an authorized signer or beneficiary’s identity that
cannot be verified to the Transfer Agent’s reasonable satisfaction, the Transfer Agent, in its
sole discretion or at the Fund’s request, may close the account or refuse to add such entity(ies)
to the account. In either case, the Transfer Agent may file the appropriate report(s) on its own
behalf with the applicable regulators and comply with instructions of appropriate regulator(s)
which may include, without limitation, freezing the account and its assets, refusing to add an
authorized signer or beneficiary to the account, and/or closing the account.
The Transfer Agent shall redeem any shares in a closed account with the opening net asset value as
of the date on which such account was closed, with the proceeds forwarded to the shareholder when
available.
The restrictions against redemption transactions with respect to an account or any authorized
signer, or beneficiary on such account shall be removed only when the Transfer Agent determines
that (i) no Positive Match exists with respect to the shareholder, authorized signer or
beneficiary, as the case may be, and (ii) such entity’s identity has been verified by the Transfer
Agent as described above.
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IV. Suspicious Activity Monitoring:
The Transfer Agent, for each shareholder account, will establish an activity pattern (the account
“Profile”) based on its transactional history for the immediately preceding twelve month time
period or such shorter period if the account has been established for less than a year. The
Profile will be based upon the number of purchases and redemptions, as well as the average dollar
amount of such purchase and redemptions during such period. Exchange transactions may or may not
be a part of the Profile, as determined by the Fund. The Profile shall not include other
transactional activity including, but not limited to, dividends, share adjustments and stock
splits. The Fund shall provide written approval of their acceptance of such Profiles.
On a daily basis, the Transfer Agent will input a file of the purchase, redemption, exchange, and
transfer transactions on a shareholder account into its database in an effort to analyze and
report any transaction (an “Exception Report’) that does not correspond to the established account
Profile or, upon request by Fund, upon rules established by Fund (e.g. report on any transaction
below a dollar minimum) and agreed upon by the Transfer Agent.
The Transfer Agent will review each Exception Report produced by the database. If the Transfer
Agent, upon review of the information available to it, determines an item listed on the Exception
Report is not suspicious, it will document its findings. Any item which the Transfer Agent, in its
reasonable opinion, determines is or may be suspicious will be reported to the Fund. Upon receipt
of such notice, the Fund shall promptly provide any additional information which it would like the
Transfer Agent to consider. Upon review of such additional information, the Transfer Agent may
determine that the item is not suspicious in nature, in which case the Transfer Agent will report
its findings to the Fund. If, however, the Transfer Agent cannot, in its sole judgment, determine
the nature/cause of the suspicious transaction, the Transfer Agent will consider the item to be
“suspicious” in nature and notify the Fund, unless prohibited by applicable law, rule or
regulation. The Transfer Agent may file the appropriate report(s) on its own behalf with the
applicable regulators and comply with instructions of appropriate
regulator(s) which may include,
without limitation, freezing the account and its assets, refusing to add an authorized signer or
beneficiary to the account, and/or closing the account.
With respect to any newly established account, the Transfer Agent will review the account for
thirty (30) days following the initial deposit into such account any and all redemptions that occur
and determine, in its sole discretion, whether or not any such redemptions are “suspicious” in
nature. If the Transfer Agent determines that any redemption is suspicious, it will promptly notify
the Fund, unless prohibited by applicable law, rule or regulation, file the appropriate report(s)
on its own behalf with the applicable regulators and comply with instructions of appropriate
regulator(s) which may include, without limitation, freezing the account and its assets, refusing
to add an authorized signer or beneficiary to the account, and/or closing the account.
The Fund acknowledges that the Transfer Agent does not accept cash equivalents (bank drafts, bank
notes, etc.) in connection with any shareholder accounts.
9
The Transfer Agent will notify the Fund of any change in payment instructions which in the sole
discretion of the Transfer Agent is deemed to be “suspicious” in nature and await instruction from
the Fund as to whether or not such change should be implemented by the Transfer Agent.
The Transfer Agent will review any changes to shareholders’ account statement address that occur
within 30 days of the account opening and notify Fund of any such changes that it deems to be
“suspicious” in nature, unless prohibited by applicable law, rule or regulation. Upon such notice
or upon instruction from the Fund, the Transfer Agent may file the appropriate report(s) on its own
behalf with the applicable regulators and comply with instructions of
appropriate regulator(s) which
may include, without limitation, freezing the account and its assets, refusing to add an authorized
signer or beneficiary to the account, and/or closing the account And
| STATE STREET BANK AND | STATE STREET NAVIGATOR | |||||||||
| TRUST COMPANY | SECURITIES LENDING TRUST | |||||||||
By: Name: |
/s/ Xxxxxx Xxxxxxx
|
By: Name: |
/s/ Xxxxx Xxxxxxx
|
|||||||
Title:
|
SVP | Title: | VP | |||||||
Date:
|
4/1/04
|
Date: | 4/6/04
|
|||||||
10
Exhibit B
— Fund List
11
Exhibit C
OFAC SDN list |
OFAC Blocked Countries |
Bank of New England |
Canadian Consolidated List (OSFI) |
12
