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EXHIBIT 9(e)
SERVICES AGREEMENT
This Agreement is made as of January 15, 1997, between Xxxxxxx Xxxxxx &
Co., Inc. ("Schwab"), a California corporation, each registered investment
company ("Fund Company") executing this Agreement, on its own behalf and on
behalf of each of its series or classes of shares listed on Schedule I, as
amended from time to time (such series or classes being referred to as the
"Fund(s)"), and Fund Affiliate (defined below) that has executed this
Agreement. Fund Company and Fund Affiliate are collectively referred to herein
as "Fund Parties." In the event that there are no series or classes of shares
listed on Schedule I, the term "Fund(s)" shall mean "Fund Company".
WHEREAS Fund Affiliate is either (i) an investment adviser to or
administrator for the Funds or (ii) the principal underwriter or distributor
for the Funds.
WHEREAS Fund Parties wish to have Schwab perform certain recordkeeping,
shareholder communication, and other services for each Fund; and
WHEREAS Schwab is willing to perform such services on the terms and
conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing and the mutual promises
set forth below, the parties agree as follows:
1. Services
a. During the term of this Agreement, Schwab shall perform the
services set forth on Exhibit A hereto, as such exhibit may be amended from time
to time by mutual consent of the parties (the "Services").
b. The parties agree that the Operating Agreement, dated as of January
15, 1997, between Schwab and Fund Company, as amended from time to time
("Operating Agreement"), is incorporated herein by this reference. In processing
purchase, redemption, transfer and exchange orders placed by Schwab on behalf of
its customers, and in order to facilitate Xxxxxx'x performance of Services, all
terms and conditions of the Operating Agreement shall be binding as between
Schwab and Fund Parties, and the references to Fund Company therein shall be
deemed to mean Fund Parties for the purposes of this Agreement. In the event of
any inconsistency between the Operating Agreement and this Agreement, this
Agreement shall control.
2. Fees
For the Services, Schwab shall receive a fee (the "Fee") which shall
be calculated and paid in accordance with Exhibit B hereto. Schedule II reflects
the portion of the Fee that
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each Fund Party has agreed, as between them, to pay. Should Exhibit A be
amended to revise the Services, the parties shall also amend Exhibit B and
Schedule II, if necessary, in order to reflect any changes in the Fee.
3. Transaction Xxxxxxx
The parties acknowledge and agree that Schwab may collect transaction
fees from certain customers (including "Active Traders," as Schwab may define
that term) for certain services and from other customers upon such other
customers' redemption of certain shares.
4. Indemnification
x. Xxxxxx shall indemnify and hold harmless Fund Parties and their
directors, officers, employees, and agents ("Indemnified Parties") from and
against any and all losses, claims, liabilities and expenses (including
reasonable attorney's fees) ("Losses") incurred by any of them arising out of
(i) Xxxxxx'x dissemination of information regarding Fund Parties or a Fund that
contains an untrue statement of material fact or any omission of a material fact
necessary in order to make the statements made, in light of the circumstances
under which they were made, not misleading and that was not published or
provided to Schwab by or on behalf of Fund Company or its affiliated persons
("Affiliates") as defined under the Investment Company Act of 1940, as amended
(the "1940 Act"), or accurately derived from information published or provided
by or on behalf of Fund Company or any Affiliate, (ii) any breach by Schwab of
any representation, warranty or agreement contained in this Agreement, or (iii)
any willful misconduct or negligence by Schwab in the performance of, or failure
to perform, its obligations under this Agreement, except to the extent such
Losses are caused by Fund Company or Fund's breach of this Agreement or Fund
Company or Fund's willful misconduct or negligence in the performance, or
failure to perform, its obligations under this Agreement. This Section 4(a)
shall survive termination of this Agreement.
b. In any event, no party shall be liable for any special,
consequential or incidental damages.
5. Role and Relationship of Schwab
The parties acknowledge and agree that the Services under this
Agreement are recordkeeping, shareholder communication and related services only
and are not the services of an underwriter or a principal underwriter of any
Fund within the meaning of the Securities Act of 1933, as amended, or the 1940
Act. This Agreement does not xxxxx Xxxxxx any right to purchase shares from any
Fund (although it does not preclude Schwab from purchasing any such shares), nor
does it constitute Schwab an agent of Fund Parties or any Fund for purposes of
selling shares of any Fund to any dealer or the public. To the extent Schwab is
involved in the purchase of shares of any Fund by Xxxxxx'x customers, such
involvement will be as agent of such customer only.
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6. Information to be Provided
Fund Parties shall provide to Schwab prior to the effectiveness of
this Agreement or as soon thereafter as practicable, two (2) copies of the
then-current prospectus and statement of additional information of each Fund.
Fund Party shall provide Schwab with written copies of any amendments to or
changes in the Fund's prospectus or statement of additional information
immediately upon their effective date.
7. Representations and Warranties
a. Each Fund Party represents and warrants that it has obtained
certified resolutions of its board of directors authorizing such Fund Party to
enter into this Agreement.
b. Each Fund Party represents and warrants that the person signing
this Agreement on its behalf is an officer authorized to execute this Agreement
on behalf of such Fund Party.
8. Notices
All notices required by this Agreement (excluding the Operating
Agreement) shall be in writing and delivered personally or sent by first class
mail. Such notices will be deemed to have been received as of the earlier of
actual physical receipt or three (3) days after deposit, first class postage
prepaid, in the United States mail. All such notices shall be made:
if to Schwab, to: Xxxxxxx Xxxxxx & Co., Inc.
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxx
Vice President/Mutual Funds
with a copy to: General Counsel, at the same address;
if to Fund Party, to the address given below in the signature
block.
9. Nonexclusivity
Each Party acknowledges that the other may enter into agreements
similar to this Agreement with other parties for the performance of services
similar to those to be provided under this Agreement, unless otherwise agreed to
in writing by the parties.
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10. Assignability
This Agreement is not assignable by any party without the other
parties' prior written consents and any attempted assignment in contravention
hereof shall be null and void; provided, however, that Schwab may, without the
consent of Fund Parties, assign its rights and obligations under this Agreement
to any Affiliate.
11. Exhibits and Schedules; Entire Agreement
All Exhibits and Schedules to this Agreement, as they may be amended
from time to time, are by this reference incorporated into and made a part of
this Agreement. This Agreement (including the Exhibits and Schedules hereto),
together with the Operating Agreement, constitute the entire agreement between
the parties as to the subject matter hereof and supersede any and all
agreements, representations and warranties, written or oral, regarding such
subject matter made prior to the time at which this Agreement has been executed
and delivered by Schwab and Fund Parties.
12. No Waiver
The failure of either party to insist upon exercising any right under
this Agreement shall not be construed as a waiver or relinquishment to any
extent of such party's right to assert or rely upon such provision or right in
any other instance.
13. Amendment
This Agreement and the Exhibits and Schedules hereto may be amended
only by a writing executed by each party hereto that is to be bound by such
amendment.
13. Governing Law
This Agreement shall be governed by and interpreted under the laws of
the State of California, applicable to contracts between California residents
entered into and to be performed entirely within the state.
14. Counterparts
This Agreement may be executed in one or more counterparts, each of
which will be deemed an original, but all of which together shall constitute one
and the same instrument.
15. Effectiveness of Agreement; Termination
a. Upon Xxxxxx'x acceptance of Schedule I, as amended from time to
time, the effective date of this Agreement as to any Fund shall be the later of
the date on which this Agreement is made or the date set forth opposite the name
of the Fund on Schedule I.
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b. This Agreement may be terminated as to a Fund by any party (i) upon
ninety (90) days' written notice to the other parties or (ii) upon such shorter
notice as is required by law, order, or instruction by a court of competent
jurisdiction or a regulatory body or self-regulatory organization with
jurisdiction over the terminating party or (iii) immediately, effective on the
day following the termination of any plan of distribution/ shareholder servicing
("Rule 12b-1 Plan") adopted and maintained pursuant to Rule 12b-1 under the 1940
Act by any Fund that has a Rule 12b-1 Plan in effect as of the effective date of
this Agreement, provided that a portion of the Fee is paid pursuant to the Rule
12b-1 Plan.
c. After the date of termination as to a Fund, Fund Parties will not
be obligated to pay the Fee with respect to any shares of the Fund that are
first held in Schwab customer accounts after the date of such termination.
However, notwithstanding any such termination, Fund Parties will remain
obligated to pay Schwab the Fee as to each share of the Fund that was considered
in the calculation of the Fee as of the date of termination (a "Pre-Termination
Share"), for so long as such Pre-Termination Share is held in any Schwab
brokerage account and Schwab continues to perform substantially all of the
Services as to such Pre-Termination Share. Further, for so long as Schwab
continues to perform the Services as to any Pre-Termination Shares, this
Agreement will otherwise remain in full force and effect as to such
Pre-Termination Shares. Fund Parties shall reimburse Schwab promptly for any
reasonable expenses Schwab incurs in effecting any termination of this
Agreement, including delivery to a Fund Party of any records, instruments, or
documents reasonably requested by the Fund Party.
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IN WITNESS WHEREOF, the parties have executed this Agreement by a duly
authorized representative of the parties hereto.
XXXXXXX XXXXXX & CO., INC. Xxxxxxxx Plumb Funds, Inc. on it's
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own behalf and on behalf of each
Fund listed on Schedule I hereto
By:_______________________________
Xxxxxxx X. Xxxxxx By: /s/ Xxxxxx X. Xxxxx
Vice President/Mutual Funds -------------------------------------
Name: Xxxxxx X. Xxxxx
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Date:________________________________ Title: President
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Date: January 15, 1997
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Address: 0000 Xxxxxxxxx Xxxxx
Xxxxx 000
Xxxxxxx XX 00000
Attn: Xxxxxx X. Xxxxx
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Xxxxxxxx Xxxxx & Associates, Inc.
Name of Fund Affiliate
Name: Xxxxxx X. Xxxxx
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Title: President
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Date: January 15, 1997
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Address: 0000 Xxxxxxxxx Xxxxx
Xxxxx 000
Xxxxxxx XX 00000
Attn: Xxxxxx X. Xxxxx
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EXHIBIT A
SERVICES
1. Record Maintenance
Schwab shall maintain the following records with respect to a Fund for
each customer who holds Fund shares in a Schwab brokerage account:
a. Number of shares;
b. Date, price and amount of purchases and redemptions (including
dividend reinvestments) and dates and amounts of dividends paid for at least the
current year to date;
c. Name and address of the customer, including zip codes and social
security numbers or taxpayers identification numbers;
d. Records of distributions and dividend payments;
e. Any transfers of shares; and
f. Overall control records.
2. Shareholder Communications
Schwab shall:
a. Provide to a shareholder mailing agent for the purpose of mailing
certain Fund-related materials the names and addresses of all Schwab customers
who hold shares of such Fund in their Schwab brokerage accounts. The shareholder
mailing agent shall be a person or entity with whom the Fund has arranged for
the distribution of certain Fund-related material in accordance with the
Operating Agreement. The Fund-related materials shall consist of updated
prospectuses and any supplements and amendments thereto, annual and other
periodic reports, proxy or information statements and other appropriate
shareholder communications. In the alternative, in accordance with the Operating
Agreement, Schwab may distribute the Fund-related materials to its customers;
b. Mail current Fund prospectuses and statements of additional
information and annual and other periodic reports upon customer request and, as
applicable, with confirmation statements;
c. Mail statements to customers on a monthly basis (or, as to accounts
in which there has been no activity in a particular month, no less frequently
than quarterly) showing, among other things, the number of shares of each Fund
owned by such customer and the net asset value of such Fund as of a recent date;
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d. Produce and mail to customers confirmation statements reflecting
purchases and redemptions of shares of each Fund in Schwab brokerage accounts;
e. Respond to customer inquiries regarding, among other things, share
prices, account balances, dividend amounts and dividend payment dates; and
f. With respect to Fund shares purchased by customers after the
effective date of this Agreement, provide average cost basis reporting to the
customers to assist them in preparation of income tax returns.
3. Transactional Services
Schwab shall communicate, as to shares of each Fund, purchase,
redemption and exchange orders reflecting the orders it receives from its
customers. Schwab shall also communicate, as to shares of each Fund, mergers,
splits and other reorganization activities.
4. Tax Information Returns and Reports
Schwab shall prepare and file with the appropriate governmental
agencies, such information, returns and reports as are required to be so filed
for reporting (i) dividends and other distributions made, (ii) amounts withheld
on dividends and other distributions and payments under applicable federal and
state laws, rules and regulations, and (iii) gross proceeds of sales
transactions as required.
5. Fund Communications
Schwab shall, on a daily basis and for each Fund, report the number of
shares on which the Fee is to be paid pursuant to this Agreement and the number
of shares on which no such Fee is to be paid. Schwab shall also provide each
Fund with monthly summaries of reports. Such summaries shall be expressed in
both shares and dollar amounts.
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EXHIBIT B
CALCULATION OF FEE
1. The Fee shall be calculated by multiplying the Daily Value of
Qualifying Shares (defined below) times 35 basis points per annum. The Fee
shall be computed daily and paid monthly in arrears.
2. The Daily Value of Qualifying Shares is the aggregate daily value of
all shares of the Fund held in Xxxxxx brokerage accounts, subject to the
following exclusions ("Qualifying Shares"). There shall be excluded from the
shares (i) shares held in a Schwab brokerage account prior to the effective
date of this Agreement as to the Fund and (ii) shares first held in a Schwab
brokerage account after the termination of this Agreement as to the Fund.
3. For purposes of this Exhibit, the daily value of the shares of each
Fund will be the net asset value reported by such Fund to the National
Association of Securities Dealers, Inc. Automated Quotation System. No
adjustments will be made to the net asset values to correct errors in the net
asset values so reported for any day unless such error is corrected and the
corrected net asset value per share is reported to Schwab before 5 o'clock,
p.m., San Francisco time, on the first business day after the day to which the
error relates.
4. At the request of Fund Parties, Schwab shall provide, on each business
day, a statement detailing the calculation for each Fund and the aggregate
value of the Qualifying Shares of each Fund. As soon as practicable after the
end of the month, Schwab shall also provide to Fund Parties an invoice for the
amount of the Fee due for each Fund. In the calculation of such Fee, Xxxxxx'x
records shall govern unless an error can be shown in the number of shares used
in such calculation.
5. Fund Parties shall pay Schwab the Fee within thirty (30) days after
Fund Parties' receipt of such statement. Such payment shall be by wire
transfer, unless the amount thereof is less than $250. Such wire transfers
shall be separate from wire transfers of redemption proceeds or distributions
under the Operating Agreement. Amounts less than $250 may, at Fund Parties'
discretion, be paid by check.
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SCHEDULE I
TO THE SERVICES AGREEMENT
Funds Effective Date
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Xxxxxxxx Xxxxx Balanced Fund* 1/15/97
Xxxxxxxx Plumb Growth Fund* 1/15/97
* Indicates that Fund is a "no load" or "no sales charge" Fund as defined in
Rule 2830 of the Conduct Rules of the National Association of Securities
Dealers, Inc. SI Indicates that the Fund is available only to Xxxxxx
Institutional customers.
Accepted by: Xxxxxxxx Plumb Funds. Inc. on it's own
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XXXXXXX XXXXXX & CO., INC. behalf and on behalf of each Fund listed on
this Schedule I
By:_______________________________
Xxxxxxx X. Xxxxxx By: /s/ Xxxxxx X. Xxxxx
Vice President/Mutual Funds -------------------------------------
Name: Xxxxxx X. Xxxxx
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Date:________________________________ Title: President
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Date: January 15, 1997
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Acknowledged by:
Xxxxxxxx Xxxxx & Associates, Inc.
Name of Fund Affiliate
By: /s/ Xxxxxx X. Xxxxx
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Name: Xxxxxx X. Xxxxx
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Title: President
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Date: January 15, 1997
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SCHEDULE II
TO THE RETAIL SERVICES AGREEMENT
Fund Company
Xxxxxxxx Plumb Funds, Inc. 0 %
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(name)
Fund Affiliate
Xxxxxxxx Xxxxx & Associates, Inc. 35 %
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(name)
Fee Rate Percentage Per Annum on
All Qualifying Shares 0.35%
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