Exhibit (9)(iii) under Form N-1A
Exhibit 10 under 601/Reg. S-K
SERVICES AGREEMENT
This Agreement is made as of the 2nd day of May, 1994 between: (1)
Fidelity Brokerage Services, Inc. ("FBSI") and National Financial Services
Corporation ("NFSC") (together "Fidelity"), and (2) the undersigned
("Fund/Agent").
RECITALS
A. Fund/Agent is either (i) an open-end investment company with one or more
series or classes of shares (each such series or class of shares a "Fund"),
(ii) an investment adviser to or administrator for the Funds, (iii) the
principal underwriter or distributor for the Funds, or (iv) the transfer
agent for the Funds.
B. Fund/Agent wishes to have Fidelity provide to Fund/Agent or on its behalf
certain administrative services with respect to beneficial owners of shares
("Shareholder(s)") of such Funds which Fidelity makes available to
Shareholders through securities brokerage accounts carried by NFSC on behalf
of FBSI or correspondents of NFSC ("Correspondents").
C. Fidelity agrees to provide such services on the terms and conditions set
forth herein.
AGREEMENT
THEREFORE, in consideration of the mutual promises set forth herein, the
parties agree as follows:
I. SHAREHOLDER SERVICES
A. Shareholder Account Set-Up and Maintenance - To facilitate Shareholders'
ownership of shares of any Fund, Fidelity shall provide to FBSI and
Correspondents adequate facilities and procedures to: (1) establish and
maintain Fund investments on behalf of Shareholders within a consolidated
brokerage account(s) on the Fidelity transaction processing and recordkeeping
system, and (2) access Shareholders' current Fund information including, but
not limited to, share balances, dividend information and transaction history.
B. Shareholder Assistance - Fidelity shall make available to Correspondents
any information maintained by Fidelity as may be necessary for Correspondents
to support and resolve Shareholder servicing inquiries. Fidelity personnel
will assist Correspondents in the investigation of Shareholder inquiries when
necessary. FBSI will support Shareholder service inquiries from Shareholders
who maintain brokerage accounts with FBSI.
C. Transaction Processing and Settlement - The Fidelity transaction
processing system shall enable Shareholders to purchase, redeem and exchange
shares of Funds available through Fidelity. NFSC shall facilitate settlement
with each Fund of Shareholder transactions in such Fund insofar as such
transactions are transmitted to NFSC by FBSI or Correspondents on behalf of
Shareholders.
D. Shareholder Account Statement Preparation and Distribution - With respect
to each Shareholder holding Fund investments through Fidelity, Fidelity shall
deliver or cause to be delivered to such Shareholder monthly statements when
there has been activity in such Shareholder's brokerage account during such
month, or quarterly statements during periods when there has been no monthly
account activity. Statements will include transaction detail for the
statement period for each Fund in which shares were purchased, redeemed or
exchanged, and a summary of the number of Fund shares owned and share value
thereof as of the statement date to the extent such value is provided by the
Fund.
E. Confirmation, Preparation and Distribution - Fidelity shall generate a
written confirmation for each purchase, redemption and exchange transaction
affecting each Shareholder's Fund investments held through Fidelity to the
extent such confirmation is required, and such confirmation shall be
distributed to Shareholders through or on behalf of FBSI or Correspondents.
F. Payment of Fund Distributions - NFSC shall distribute to Shareholders all
dividend, capital gain or other payments authorized by the Fund and
distributed to and received by NFSC, and such distributions shall be credited
to Shareholders in accordance with the instructions provided by each
Shareholder, including but not limited to dividend reinvestment into the
Fund, or cash payments of distributions.
G. Prospectus Fulfillment - Fund/Agent agrees to make available to Fidelity
prospectuses for each Fund meeting the requirements of applicable law. To
the extent a prospectus is required to be delivered to a Shareholder in
connection with a purchase or exchange of Fund shares, Fidelity agrees to
provide each Shareholder with such a prospectus within the time required by
applicable law.
Fund/Agent acknowledges and agrees that Fidelity is not responsible for
(i) the compliance of any prospectus or supplement thereto, annual report,
proxy statement or item of advertising or marketing material of or relating
to any Fund, with any applicable laws, rules or regulations, (ii) the
registration or qualification of any shares of any Fund under any federal or
applicable state laws or (iii) the compliance by any Fund or Fund/Agent or
any "affiliated person" (as that term is defined in the rules under the
Investment Company Act of 1940, as amended), with any applicable federal or
state law, rule, or regulation or the rules and regulations of any self-
regulatory organization with jurisdiction over such Fund, Fund Agent or
affiliated person.
H. Account Level Tax Reporting - NFSC shall provide to Shareholders through
FBSI or Correspondent such reports and information as may be required by the
then-prevailing laws and regulations under the Internal Revenue Code for non-
retirement accounts and qualified and non-qualified retirement plan accounts.
II.REPRESENTATIONS AND WARRANTIES
A. Fund/Agent represents and warrants that:
(1) it has the requisite authority to enter into this agreement on its
own behalf and on behalf of the Fund(s), and
(2) that the payment to NFSC of any fees pursuant hereto:
(a) has been duly authorized by the Fund(s), the Board of Trustees of
the Fund(s), or any other persons to the extent such authorization
is required to properly make such payment;
(b) is properly disclosed in the relevant Fund prospectus to the extent
such disclosure may be required, and
(c) is and will remain in material conformity with all federal and
state laws or regulations and self-regulatory organization rules to
which the Fund or its agents are subject.
B. FBSI and NFSC each represent and warrant that:
(1) it is a corporation duly organized under the laws of the
Commonwealth of Massachusetts and is duly registered and/or qualified as a
broker/dealer with the SEC, NASD and in every state or territory of the
United States of America (including the District of Columbia) where such
registration or qualification is required and has the requisite authority to
enter into this Agreement and to carry out the services contemplated herein;
(2) the execution and delivery of this Agreement and the performance of
the services contemplated herein have been duly authorized by all necessary
corporate action in its part, and this Agreement constitutes the valid and
binding obligations of FBSI and NFSC; and
(3) it is and will remain in material conformity with all federal and
state laws or regulations and self-regulatory organization rules to which
FBSI or NFSC or their agents are subject.
C. Each party hereto represents and warrants that it shall provide to the
others such information or documentation necessary for such party to fulfill
its obligations hereunder, such other information or documentation as any
party may reasonably request, and that it shall comply with such operating
policies and procedures as the parties may adopt from time to time.
III. FEES
For the services provided by Fidelity hereunder, Fund/Agent shall pay to
NFSC a fee with respect to each Fund, which fee shall be based upon a
percentage per annum of the average daily value of the aggregate number of
shares of the Fund held by NFSC for the accounts of customers of FBSI and
Correspondents. Such fee shall be calculated and paid in accordance with
Exhibit A hereto.
In the event the parties agree to material changes to the scope of
services provided hereunder, the parties agree to negotiate in good faith as
to the appropriate amendment to the fees due NFSC.
IV.INDEMNIFICATION
Fund/Agent shall indemnify and hold harmless Fidelity and each officer,
employee and agent of Fidelity from and against any and all claims, demands,
actions, losses, damages, liabilities, or costs, charges, counsel fees, and
expenses of any nature ("Losses") arising out of (i) any inaccuracy or
omission in any prospectus or supplement thereto, registration statement,
annual report or proxy statement, of any Fund or Fund/Agent or any
advertising or promotional material generated by any Fund or Fund/Agent, (ii)
any breach by Fund/Agent of any representation, warranty, convenant, or
agreement contained in this Agreement and (iii) any action taken or omitted
to be taken by Fidelity pursuant to this Agreement in reliance on any such
representation, warranty, covenant or agreement by Fund/Agent, except to the
extent such Losses result from Fidelity's breach of the Agreement, willful
misconduct, or gross negligence.
Fidelity shall indemnify and hold harmless Fund/Agent and each officer,
employee and agent of Fund/Agent from and against any and all claims,
demands, actions, losses, damages, liabilities, or costs, charges, counsel
fees, and expenses of any nature ("Losses") arising out of (i) any breach by
Fidelity of any representation, warranty, covenant, or agreement contained in
this Agreement and (ii) any action taken or omitted to be taken by Fund/Agent
pursuant to this Agreement in reliance on any such representation, warranty,
covenant, or agreement by Fidelity, except to the extent such Losses result
from Fund/Agent's breach of this Agreement, willful misconduct, or gross
negligence.
V. CONFIDENTIALITY
Each party acknowledges and understands that any and all technical, trade
secret, or business information, including, without limitation, financial
information, business or marketing strategies or plans, product development
or customer information, which is disclosed to the other or is otherwise
obtained by the other, its affiliates, agent or representatives during the
term of this Agreement other than through publicly available sources (the
"Proprietary Information") is confidential and proprietary, constitutes trade
secrets of the owner, and is of great value and importance to the success of
the owner's business. Each party agrees to use its best efforts (the same
being not less than that employed to protect his own proprietary information)
to safeguard the Proprietary Information and to prevent the unauthorized,
negligent or inadvertent use or disclosure thereof. Neither party shall,
without the prior written approval of any officer of the other, directly or
indirectly, disclose the Proprietary Information to any person or business
entity except for a limited number of employees, attorneys, accountants and
other advisors of the other on a need-to-know basis or as may be required by
law or regulation. Each party shall promptly notify the other in writing of
any unauthorized, negligent or inadvertent use or disclosure of Proprietary
Information. Each party shall be liable under this Agreement to the other
for any use or disclosure in violation of this Agreement by its employees,
attorneys, accountants, or other advisors or agents. This Section V shall
continue in full force and effect notwithstanding the termination of this
Agreement.
VI.DURATION AND TERMINATION OF AGREEMENT
With respect to any Fund, this Agreement shall become effective upon the
date such Fund is identified on Exhibit B, and this Agreement is approved by
the Fund or its Board of Trustees if such approval is required, and shall
continue in force for one year, and shall thereafter continue automatically
for successive annual periods unless earlier terminated and subject to any
periodic approval required by the Fund or its Board of Trustees. This
Agreement is terminable as to any Fund by any party upon 90 days written
notice thereof to the other parties or upon default hereof provided that such
default shall not terminate this Agreement to the extent the defaulting party
has been notified of such default by the non-defaulting party and the
defaulting party cures such default within 10 business days of notice of such
default.
In addition, this Agreement may be terminated at any time with respect to a
Fund, without the payment of any penalty, by the vote of a majority of the
members of the Board of the Fund who are not interested persons of the Fund
and have no direct or indirect financial interest in the operation of the
Fund's Shareholder Services Plan or in any related documents to the
Shareholder Services Plan.
After the date of termination as to any Fund, no fee will be due with
respect to any shares of such Fund that are first placed or purchased in
Fidelity or Correspondent customer accounts after the date of such
termination. However, notwithstanding any such termination, Fund/Agent, and
any successor or assignee, will remain obligated to pay NFSC the fee as to
each share of such Fund that was considered in the calculation of the fee as
of the date of such termination, for so long as such share is held in the
Fidelity or Correspondent account, but only so long as the Shareholder
Services Agreement between the Fund and Fund/Agent, or any successor or
assignee, remains in effect. This Agreement, or any provision hereof, shall
survive termination to the extent necessary for each party to perform its
obligations with respect to shares for which a fee continues to be due
subsequent to such termination.
VII. MISCELLANEOUS
A. Custody - Fund/Agent acknowledges that Fund shares maintained by the Fund
for Shareholders hereunder are held in custody for the exclusive benefit of
customers of NFSC or its Correspondents and shall be held free of any right,
charge, security interest, lien or claim against NFSC in favor of the Fund or
its agents acting on behalf of the Fund.
B. Transaction Charges - During the term of this Agreement, FBSI shall not
assess against or collect from its brokerage customers any transaction fee
upon the purchase or redemption of any Fund's shares that are considered in
calculating the fee due pursuant to Section III hereof. The parties
acknowledge and agree that FBSI reserves the right to collect such
transaction fees from certain customers (including "Active Traders," as FBSI
may define that term) for certain special trading services and from other
customers upon such other customers' redemption of certain shares.
C. Use of Fidelity Investments Name - Fund/Agent will not, nor will
Fund/Agent cause or permit any Fund to, describe or refer to the name
"Fidelity Investments" or any derivation thereof, or to FMR Corp. or any
affiliate thereof, or to the services or relationship contemplated by this
Agreement in any advertisement or promotional materials or activities without
the prior written consent of an authorized officer of Fidelity.
D. Nonexclusivity - Fund/Agent acknowledges that Fidelity may perform
services similar to those to be provided under this Agreement to other
investment companies, investment company sponsors, or service providers to
investment companies.
E. Force Majeure - Neither Fidelity nor its affiliates shall be liable to
Fund/Agent or any Fund, nor shall Fund/Agent or any Fund or their affiliates
be liable to Fidelity for any damage, claim, or other loss whatsoever caused
by circumstances or events beyond its reasonable control.
F. Notices - All notices and communications required or permitted by this
Agreement shall be in writing and delivered personally or sent by first class
mail unless otherwise agreed. All such notices and other communications
shall be made:
if to Fidelity, to:
Fidelity Investments
00 Xxxxxxxxxx Xxxxxx, X00X
Xxxxxx, XX 00000
Attn: Xxxxx Xxxxxx
if to Fund/Agent, to:
Federated Shareholder Services
Attn: Xxxx X. XxXxxxxxx
0000 Xxxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000-0000
G. This Agreement and any Exhibits hereto may be amended only upon the
written agreement of the parties.
H. This Agreement may not be transferred or assigned by either Fund/Agent or
Fidelity, and shall be construed in accordance with the laws of the
Commonwealth of Massachusetts.
I. Proxies: Fidelity agrees not to solicit or cause to be solicited
directly, or indirectly at any time in the future, any proxies from the
shareholders of a Fund in opposition to proxies solicited by management of
the Fund, unless a court of competent jurisdiction shall have determined that
the conduct of a majority of the Board of Trustees or Directors of the Fund
constitutes willful misfeasance, bad faith, gross negligence or reckless
disregard of their duties. This Subsection I will survive the term of the
Agreement.
J. Fund and Fund/Agent's Names: Unless otherwise agreed to in writing by
the parties, references to the Fund/Agent and any Fund may only appear in:
i. Direct mail pieces to existing Fidelity customers;
ii. Fidelity Focus
iii. Fidelity Performance Directory
iv. FundsNetwork newsletters
v. Segment Newsletters
vi. Fidelity On-Line Express
vii. Brokerage Fulfillment kits
Fidelity will not use the Fund/Agent's name or the name of any Fund in any
advertisements, promotional materials or other communications with the
general public.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
Federated Shareholder Services Fidelity Brokerage Services, Inc.
By:/s/Xxxxxxx X. Xxxx By:/s/Xxxxx Xxxxxx
Title: Senior Vice President Title: Senior
Vice President
Fund or
Company:
National Financial Services Corporation
By:/s/Xxxxxx X. Xxxxx
Title: Director
EXHIBIT A
Calculation and Payment of Fees Pursuant to Section III
1. Except as provided in paragraph 2 below, for the services provided by
Fidelity hereunder, Fund/Agent shall pay to NFSC a fee with respect to each
Fund, calculated daily and paid monthly in arrears, equal to (1) .35 percent
per annum with respect to non-Fixed Income Funds and (2) .25 percent per
annum with respect to Fixed Income Funds (as defined below) of the daily
market value of the total number of shares of such Fund held in accounts at
NFSC (determined by multiplying the number of such shares times the publicly-
reported net asset value of each share), excluding the value of (i) shares as
to which a brokerage customer may pay a transaction fee to FBSI because such
customer has been defined as an Active Trader, and (ii) shares held in a
brokerage account prior to the effective date of the Agreement as to the Fund
issuing such shares, and (iii) shares first placed or purchased in a
brokerage account after the termination of the Agreement as to the Fund/Agent
issuing such shares. The total number of shares of all Funds with respect to
which a fee will be due to Fidelity hereunder shall be referred to in this
Exhibit A as "Participating Assets". For the purposes of Exhibit A, Fixed
Income Fund shall be defined as any Fund whose underlying portfolio at the
time of the calculation of the fee is not less than 80% invested in fixed
income instruments.
2. With respect to non-Fixed Income Funds, Fidelity shall calculate the
total market value of Participating Assets for each Fund/Agent two times per
calendar year, once as of Fidelity's brokerage month end in June and once as
of Fidelity's brokerage month end in December. In the event that as of any
such month-end the total value of Fund/Agent Participating Assets equals or
exceeds the amount(s) set forth below, then the fee due Fidelity with respect
to total Participating Assets shall be adjusted prospectively as of such
month-end to the per annum fee set forth opposite the total value of
Participating Assets. The new fee will apply on a per annum basis going
forward, calculated daily and paid monthly in arrears, on all participating
assets until the next evaluation date.
Total Value of Fund/Agent
Participating Assets Per Annum Fee
$100 million up to $500 million .30%
over $500 million .25%
In all other respects, the fee due Fidelity shall be calculated and payable
in accordance with this Agreement and Exhibit A.
3. Subsequent to each month-end, NFSC shall send to Fund/Agent a statement
of the market value of shares of the Fund for which the fee is calculated for
the preceding month, together with a statement of the amount of such fee. In
the calculation of such fee, NFSC records shall govern unless Fund/Agent can
demonstrate that the number of shares or Fund price(s) used in such
calculation is inaccurate.
4. Fund/Agent shall pay to NFSC such fee within 30 days after Fund/Agent's
receipt of such statement. Such payment shall be by wire transfer or other
form acceptable to NFSC and shall be separate from payments related to
redemption proceeds and distributions.
EXHIBIT B
FUNDS PARTICIPATING IN SERVICES AGREEMENT
Fund Name CUSIP Trading Symbol Date
Federated High Yield Trust 314197104 FHYTX May 2, 1994
Federated Growth Strategies Fund 314190109 FGTRX Nov 14, 1994
Federated Stock Trust 313900102 FSTKX Nov 14, 1994
Federated US Gov't Bond Fund 314284100 FEDBX Nov 14, 1994
Federated Stock & Bond Fund, Inc. 00000X000 FSTBX Nov 14, 1994
Federated Short-Term Income Fund 314206308 FSISX May 2, 1994
Intermediate Income Fund 00000X000 N/A May 2, 1994
Intermediate Municipal Trust May 2, 1994
Federated Mid-Cap Fund August, 1995
Federated Mini-Cap Fund August, 1995
Fed. Ohio Intermediate Municipal Trust November, 1995
Fed. Pennsylvania Intermediate Municipal Trust November, 1995
Institutional Service Shares of:
Federated U.S. Government Securities
Fund: 1-3 Years 313901209 FSGIX May 2, 1994
Federated ARMs Fund 314082207 FASSX. May 2, 1994
Federated U.S. Government Securities
Fund: 2-5 Years 314200205 FIGIX May 2, 1994
Federated Income Trust 314199209 FITSX May 2, 1994
Fed Short-Term Municipal Trust 825253206 FSHSX May 2, 1994
Federated GNMA Trust 314184201 FGSSX May 2, 1994
Federated Max-Cap Fund 00000X000 N/A Nov. 14, 1994
Fed. U.S. Government Securities Fund: 5-10 Years February, 1996
Class A Shares of:
Fed. American Leaders Fund, Inc. 027128107 FALDX Nov. 14, 1994
Federated Equity Income Fund, Inc. 530461102 LEIFX Nov. 14, 1994
Federated Municipal Securities
Fund, Inc. 530900109 LMSFX Nov. 14, 1994
Fed. International Equity Fund 46031P908 FTITX Nov. 14, 1994
Fed. International Income Fund 00000X000 FTIIX Nov. 14, 1994
Fed. Strategic Income Fund 338319700 N/A Nov. 14, 1994
Fed. World Utility Fund 981487101 N/A Nov. 14, 1994
Fed. Fund for U.S. Government
Securities, Inc. November, 1995
Select Shares of:
Federated Managed Aggressive
Growth Fund 00000X000 N/A Nov. 14, 1994
Federated Managed Growth Fund 00000X000 N/A Nov. 14, 1994
Federated Managed Growth &
Income Fund 00000X000 N/A Nov. 14, 1994
Federated Managed Income Fund 00000X000 N/A Nov. 14, 1994
Fortress Shares of:
Fed. California Municipal Income Fund 625922109 N/A Nov. 14, 1994
Fed. New York Municipal Income Fund 625922208 NYIFX Nov. 14, 1994
Fortress Utility Fund 349561100 FEUTX Nov. 14, 1994
