AMENDMENT To Transfer Agency and Service Agreement Between The Charles Schwab Family of Funds, Schwab Investments, Schwab Capital Trust, Schwab Annuity Portfolios and Boston Financial Data Services, Inc.
AMENDMENT
To Transfer Agency and Service Agreement
Between
The Xxxxxxx Xxxxxx Family of Funds,
Schwab Investments,
Schwab Capital Trust,
and
Boston Financial Data Services, Inc.
This Amendment is made this 3rd day of October, 2016 and effective as of May 1, 2016, between The Xxxxxxx Xxxxxx Family of Funds, Schwab Investments, Schwab Capital Trust, and Schwab Annuity Portfolios (each, a “Fund”, and collectively, the “Funds”) and Boston Financial Data Services, Inc. (the “Transfer Agent”). In accordance with Section 3 (Fees and Expenses) and Section 16.1 (Amendment) of the Transfer Agency and Service Agreement dated July 1, 2009 between the Funds and Transfer Agent (the “Agreement”) the parties desire to amend the Agreement as set forth herein.
NOW THEREFORE, the parties agree as follows:
| 1. | Additional Services. Section 1.2 of the Agreement is hereby amended by adding the following new sub section 1.2(n): |
“(n) Identity Theft Prevention. The Transfer Agent has developed and maintains a program of policies, procedures and controls to assist each Fund in its compliance with applicable identity theft regulatory requirements, including Regulation S-ID, Title 16 of the Code of Federal Regulations (“CFR”) Part 681 (Identity Theft Rules) and giving due consideration to the Guidelines provided in Appendix A thereto. The Transfer Agent’s program and controls are reasonably designed to assist in the detection of violations of those requirements. Among other things, the program is designed to identify, detect, and respond to Red Flags, as defined in Section 681.1. The Transfer Agent agrees to promptly report any detected violations to the affected Fund in accordance with agreed upon procedures and to provide annual certification to each Fund with respect to its controls.”
| 2. | Section 3.1. Section 3.1 of the Agreement is hereby deleted in its entirety and replaced with the following: |
| “3.1 | Fee Schedule. For the performance by the Transfer Agent pursuant to this Agreement, each Fund agrees to pay the Transfer Agent the fees and expenses as set forth in the attached Schedule 3.1. Such fees and other fees, charges and advances identified under Section 3.2 below may be changed from time to time subject to mutual written agreement between each Fund and the Transfer Agent. The parties agree that the fees set forth on Schedule 3.1 shall apply with respect to the Portfolios set forth on Schedule A hereto, as such Schedule may be amended from time to time, and to any additional series added to this Agreement under Section 16 that have requirements consistent with services then being provided by the Transfer Agent under this Agreement.” |
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| 3. | Section 3.2. Section 3.2 of the Agreement is hereby deleted in its entirety and replaced with the following: |
| “3.2 | Other Fees and Charges. In addition to the fees paid under Section 3.1 above, each Fund agrees to pay the Transfer Agent for certain other fees and charges, as set forth in “Other Fees and Charges” in Schedule 3.1, and such other fees, charges or expenses, each as incurred at the direction of the Funds or with advance written consent from the Funds. To the extent that “Other Fees and Charges” are comprised of pass-through fees from a third party, Transfer Agent will provide the Funds an invoice from the third party, upon reasonable request, for validation purposes.” |
| 4. | Cost of Living Adjustment. The first sentence of Section 3.5 of the Agreement shall be deleted and replaced with the following sentence: |
“Each year on May 1 during any term of this Agreement, there shall be a cost of living adjustment as reflected in Schedule 3.1 attached hereto.”
| 5. | Term. The first sentence of Section 12.1 of the Agreement shall be deleted and replaced with the following sentence: |
“The initial term of this Agreement shall continue through April 30, 2020 (the “Initial Term”)”, unless terminated pursuant to the provisions of this Section 12.”
| 6. | Schedule A. The current Schedule A to the Agreement is replaced and superseded with Schedule A attached hereto and dated August 18, 2016; |
| 7. | Omnibus Transparency Services Schedule. The current Omnibus Transparency Services Schedule (“Schedule 1.2(l)”) to the Agreement dated July 1, 2009 is hereby replaced and superseded with Schedule 1.2(l) attached hereto, dated May 1, 2016; |
| 8. | Fee Schedule. The current Fee Schedule (“Schedule 3.1”) to the Agreement effective from February 1, 2013 through January 31, 2016 is hereby replaced and superseded with Schedule 3.1 attached hereto, dated May 1, 2016; |
| 9. | All defined terms and definitions in the Agreement shall be the same in this Amendment except as specifically revised by this Amendment. |
| 10. | Except as specifically set forth in this Amendment, all other terms and conditions of the Agreement shall remain in full force and effect. |
| 11. | The Parties hereby agree that the Agreement has been continually in full force and effect at all times since its effective date and that the Funds have heretofore provided the Transfer Agent with all notices required to effect any renewal or extension of the Agreement. To the extent that any provisions of this Amendment are inconsistent with the terms of the Agreement, the terms of this Amendment shall govern solely with regard to the subject of the inconsistency. This Amendment may be executed in any number of counterparts, each of which shall be an original and all of which together shall constitute one and the same document. |
Signature page to follow
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed in their names and on their behalf by and through their duly authorized officers, as of the day and year first above written.
| THE XXXXXXX XXXXXX FAMILY OF FUNDS | ||
| By: | /s/ Xxxxxx Xxxxxxx | |
| Name: | Xxxxxx Xxxxxxx | |
| Title: | Chief Operating Officer | |
| SCHWAB INVESTMENTS | ||
| By: | /s/ Xxxxxx Xxxxxxx | |
| Name: | Xxxxxx Xxxxxxx | |
| Title: | Chief Operating Officer | |
| SCHWAB CAPITAL TRUST | ||
| By: | /s/ Xxxxxx Xxxxxxx | |
| Name: | Xxxxxx Xxxxxxx | |
| Title: | Chief Operating Officer | |
| SCHWAB ANNUITY PORTFOLIOS | ||
| By: | /s/ Xxxxxx Xxxxxxx | |
| Name: | Xxxxxx Xxxxxxx | |
| Title: | Chief Operating Officer | |
| BOSTON FINANCIAL DATA SERVICES, INC. | ||
| By: | /s/ Xxxxxxx X. XxXxxxx | |
| Name: | Xxxxxxx X. XxXxxxx | |
| Title: | Managing Director | |
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SCHEDULE A
LIST OF FUNDS
As of August 18, 2016
THE XXXXXXX XXXXXX FAMILY OF FUNDS
Schwab Money Market Fund
Schwab Value Advantage Money Fund
Schwab Value Advantage Money Fund-Institutional Prime Shares
Schwab Retirement Advantage Money Fund
Schwab Investor Money Fund
Schwab Government Money Fund
Xxxxxx U.S. Treasury Money Fund
Xxxxxx Municipal Money Fund
Schwab California Municipal Money Fund
Schwab New York Municipal Money Fund (formerly Schwab New York AMT Tax-Free Money Fund)
Xxxxxx AMT Tax-Free Money Fund (formerly Florida Muni Money Fund)
Schwab Massachusetts Municipal Money Fund (formerly Schwab Massachusetts AMT Tax-Free Money Fund)
Schwab Pennsylvania Municipal Money Fund
Schwab New Jersey Municipal Money Fund (formerly Schwab New Jersey AMT Tax-Free Money Fund)
Schwab Cash Reserves
Schwab Advisor Cash Reserves
Schwab Treasury Obligations Money Fund
Schwab Variable Share Price Money Fund
SCHWAB INVESTMENTS
Schwab 1000 Index Fund
Schwab Short-Term Bond Market Fund
Schwab Total Bond Market Fund
Schwab GNMA Fund
Schwab Tax-Free Bond Fund
Schwab California Tax-Free Bond Fund
Schwab Treasury Inflation Protected Securities Index Fund (formerly Schwab Inflation Protected Fund)
Schwab Global Real Estate Fund
Schwab Intermediate-Term Bond Fund (formerly Schwab Premier Income Fund)
SCHWAB CAPITAL TRUST
Schwab MarketTrack All Equity Fund
Schwab MarketTrack Growth Portfolio
Schwab MarketTrack Balanced Portfolio
Schwab MarketTrack Conservative Portfolio
Schwab Balanced Fund (formerly Schwab Viewpoints Fund)
Laudus Small-Cap MarketMasters Fund
Laudus International MarketMasters Fund
Schwab Core Equity Fund
Schwab Hedged Equity Fund
Schwab Total Stock Market Index Fund
Schwab S&P 500 Index Fund
Schwab Small Cap Index Fund
Schwab International Index Fund
Schedule A - 1
SCHWAB CAPITAL TRUST (continued)
Schwab Health Care Fund
Schwab Small Cap Equity Fund
Schwab Dividend Equity Fund
Schwab Target 2010 Fund
Schwab Target 2015 Fund
Schwab Target 2020 Fund
Xxxxxx Target 2025 Fund
Xxxxxx Target 2030 Fund
Xxxxxx Target 2035 Fund
Schwab Target 2040 Fund
Schwab Large Cap Growth Fund
Schwab Fundamental US Small Company Index Fund
Schwab Fundamental US Large Company Index Fund
Schwab Fundamental International Large Company Index Fund
Schwab Fundamental Emerging Markets Large Company Index Fund
Schwab Fundamental International Small Company Index Fund
Xxxxxx Monthly Income Fund - Moderate Payout
Xxxxxx Monthly Income Fund - Enhanced Payout
Xxxxxx Monthly Income Fund - Maximum Payout
Schwab International Core Equity Fund
Schwab Target 2045 Fund
Schwab Target 2050 Fund
Xxxxxx Target 2055 Fund
Schwab Fundamental Global Real Estate Index Fund
Schwab Target 2060 Fund
Xxxxxx Target 2010 Index Fund
Xxxxxx Target 2015 Index Fund
Xxxxxx Target 2020 Index Fund
Xxxxxx Target 2025 Index Fund
Xxxxxx Target 2030 Index Fund
Xxxxxx Target 2035 Index Fund
Xxxxxx Target 2040 Index Fund
Xxxxxx Target 2045 Index Fund
Schwab Target 2050 Index Fund
Xxxxxx Target 2055 Index Fund
Schwab Target 2060 Index Fund
Schwab Government Money Market Portfolio (formerly Schwab Money Market Portfolio)
Schwab MarketTrack Growth Portfolio II
Schwab S&P 500 Index Portfolio
Schwab VIT Balanced Portfolio
Schwab VIT Balanced with Growth Portfolio
Schwab VIT Growth Portfolio
Schedule A - 2
SCHEDULE 1.2(1)
OMNIBUS TRANSPARENCY SERVICES
Dated: May 1, 2016
| A. | The Funds shall provide the following information to the Transfer Agent: |
| 1. | A daily transmission of Dealer 164 trades in an industry standard format; |
| 2. | The Funds to be included, along with each Fund’s frequent trading policy. |
| B. | Upon receipt of the foregoing information, the Funds hereby authorize and instruct the Transfer Agent to perform the following Services: |
1. Financial Intermediary Surveillance Schedules
(a) Create a system profile and infrastructure based upon parameters set by each Fund to establish and maintain Financial Intermediary surveillance schedules and communication protocol/links.
2. Data Management Monitoring
(a) Monitor status of information requests until all supplemental data is received.
3. Customized Reporting for Market Timing Analysis
(a) Run information received from the Financial Intermediaries through TA2000 System functionalities.
(b) Generate exception reports using parameters provided by the Funds.
4. Daily Exception Analysis of Market Timing Policies for Supplemental Data Provided
(a) Review daily short-term trader exceptions, daily excessive trader exceptions, and daily supplemental data reconciliation exceptions.
(b) Analyze Financial Intermediary supplemental data (items), which are identified as “Potential Violations” based on parameters established by the Funds.
(c) Confirm exception trades and if necessary, request additional information regarding Potential Violations.
5. Communication and Resolution of Market Timing Exceptions
(a) Communicate results of analysis to the Funds.
(b) Update AWD Work Object with comments detailing resolution.
(c) Keep a detailed record of all data exceptions and inquires with regards to potential violations.
6. Management Reporting
(a) Provide periodic reports, in accordance with agreed upon frequency and content parameters, to the Funds. As reasonably requested by the Funds, the Transfer Agent shall furnish ad hoc reports to the Funds.
7. Support Due Diligence Programs
(a) Update system watch list with pertinent information on trade violators.
(b) Maintain a detailed audit trail of all accounts that are blocked and reason for doing so.
Schedule 1.2(1)
