Exhibit(h)(1)
AMENDED AND RESTATED TRANSFER AGENT CONTRACT
AMENDED AND RESTATED TRANSFER AGENT CONTRACT (this "Contract"), dated as of
__________, 2003 by and between WM Trust I, WM Trust II and WM Variable Trust
(each a "Trust" and a "Company"), each a Massachusetts business trust, WM
Strategic Asset Management Portfolios, LLC (the "LLC" and a "Company"), a
Massachusetts limited liability company, WM Shareholder Services, Inc. ("WMSS"),
a Washington corporation, and PFPC, Inc. a Massachusetts corporation ("PFPC").
WITNESSETH
WHEREAS, each Company is an investment management company registered under
the Investment Company Act of 1940 (the "1940 Act");
WHEREAS, each Company is authorized to issue shares in separate series with
each series listed on the signature page of the Contract representing a separate
portfolio of securities and other assets (each a "Fund");
WHEREAS, each Fund desires PFPC to perform the services set forth on
Schedule A hereto, and PFPC is willing to perform such services;
WHEREAS, each Fund desires WMSS to oversee the provision by PFPC of the
services set forth in Schedule A hereto, and to perform the services set forth
in Schedule B hereto (to the extent they are not provided by PFPC pursuant to
Section 1 hereof), and WMSS is willing to oversee and perform such services;
WHEREAS, WMSS and PFPC are parties to a certain Service Agreement dated as
of June 17, 1998, as amended through January __, 2003 (the "Services
Agreement");
NOW THEREFORE, in consideration of the premises and the mutual agreements
set forth herein, all the parties hereto agree as follows:
1. PFPC agrees to perform the services set forth in Schedule A hereto.
2. WMSS agrees to oversee PFPC in its performance of the services set forth
in Schedule A hereto, and to perform the services set forth in Schedule B hereto
to the extent they are not performed by PFPC pursuant to Section 1 hereof.
3. WMSS's monthly fees under this Contract will be calculated in accordance
Schedule C hereto (the "WMSS Monthly Fees"), subject to the provisions of this
Section 3 and subject to reduction as set forth in Exhibit 1 to Schedule D
hereto. PFPC's monthly fees under this Contract will be calculated in accordance
with Schedule D hereto (the "PFPC Monthly
A-1
Fees"), subject to the provisions of this Section 3 and subject to adjustment as
set forth in Exhibit 1 to Schedule D hereto.
(a) The Funds agree to pay directly to PFPC the lesser of (i) the WMSS
Monthly Fees and (ii) the PFPC Monthly Fees.
(b) If, for a given month, WMSS Monthly Fees exceed PFPC Monthly Fees,
the Funds shall pay to WMSS an amount equal to the excess of (i) the WMSS
Monthly Fees over (ii) the PFPC Monthly Fees.
(c) If, for any given month, the PFPC Monthly Fees exceed the WMSS
Monthly Fees, WMSS shall pay to PFPC an amount equal to the excess of (i) the
PFPC Monthly Fees over (ii) the WMSS Monthly Fees.
(d) For the avoidance of doubt, WMSS acknowledges and agrees that it
shall not be entitled to any portion of the PFPC Monthly Fees.
4. PFPC hereby waives, with respect to any periods during which this
Contract is in effect, any right to receive from WMSS any fees under the
Services Agreement in respect of the services set forth on Schedule A hereto.
5. Each Company acknowledges and agrees that, for so long as PFPC provides
the services set forth on Schedule A hereto in accordance with the performance
standards (the "Performance Standards") set forth in Schedule 1 to Exhibit D
hereto, including performing at least within all Standard Performance Ranges (as
defined therein), WMSS shall have met its obligation to provide the services set
forth on Schedule A hereto.
6. WMSS agrees to indemnify and hold the Funds harmless from and against
any and all claims, costs, expenses (including attorneys' fees), losses,
damages, charges, payments and liabilities of any sort or kind which may be
asserted against the Funds or for which the Funds may be held liable (a "Claim")
arising out of or attributable to any actual or alleged failure of PFPC to
provide the services set forth on Schedule A hereto in accordance with the
Performance Standards.
7. WMSS agrees to indemnify and hold PFPC harmless from and against any
and all Claims arising out of or attributable to this Contract to the extent
that PFPC would not have been responsible for such Claims under the Services
Agreement.
8. Each Fund agrees to reimburse each of WMSS and PFPC, as applicable, for
the out-of-pocket expenses set forth on Schedule E hereto.
9. Each Fund agrees that all computer programs and procedures developed
and/or used by WMSS and PFPC to perform services required under this Contract
are the property of WMSS and PFPC, respectively, and WMSS and PFPC agree that
all records and other data of the Funds maintained by WMSS and PFPC, except
computer programs and procedures, are the
A-2
property of the Fund. Each of WMSS and PFPC agrees that it will furnish all such
records and other data as may be requested to a Fund immediately upon
termination of this Contract for any reason whatsoever.
10. Each of WMSS and PFPC agrees to treat all records and other information
relative to a Fund with utmost confidence and further agrees that all records
maintained by it for the Fund shall be open to inspection and audit at
reasonable times by the officers, agents or auditors employed by the Fund and
that such records shall be preserved and retained by it so long as this Contract
shall remain in effect.
11. Neither PFPC nor WMSS shall be liable for any damage, loss of data,
delay or any other loss caused by any such power failure or machine breakdown,
except that each shall be liable for actual out-of-pocket costs caused by any
such power failure or machine breakdown, and each shall make all reasonable
efforts to recover the data in process that is assumed lost during any power
failure or machine breakdown.
12. WMSS will maintain in force through the duration of this Contract a
fidelity bond in a face amount not less than $1,000,000 written by a reputable
insurance company, covering theft, embezzlement, forgery and other acts of
malfeasance by WMSS, its employees, or agents in connection with services
performed for a Fund.
13. This Contract may be terminated without the payment of any penalty by
any party upon one hundred eighty (180) days written notice thereof given by a
any party hereto to the other parties hereto. For the avoidance of doubt,
termination of this Contract will not terminate the Services Agreement. Upon
such termination, PFPC's right to receive fees from WMSS under the Services
Agreement shall automatically be reinstated. Termination of this Agreement shall
in no way be interpreted or construed as termination of the Services Agreement
which shall remain in effect until terminated in accordance with its terms.
14. Any notice shall be officially given to a Fund when sent by registered
or certified mail by a party to the appropriate address listed in the Fund's
current registration statement, provided that each party may notify the others
by regular mail of any changed address to which such notices should be sent.
15. This Contract constitutes the entire agreement between the Funds and
each of WMSS and PFPC, and shall be governed by, and construed in accordance
with, the laws of the Commonwealth of Massachusetts and shall inure to the
benefit of the parties hereto and their respective successors.
16. (a) A copy of the Declaration of Trust of each Trust is on file with
the Secretary of the Commonwealth of Massachusetts, and notice is hereby given
that this Contract is executed by an officer of each Trust on behalf of each
Fund, and that the obligations of this Contract shall be binding upon the assets
and properties of the Fund only and shall not be binding upon the assets and
properties of any other series of any Trust or upon any of the trustees,
officers, employees, agents or shareholders of the Fund or the Trust
individually.
A-3
(b) A copy of the LLC Certificate of Formation of the LLC is on file with
the Secretary of the Commonwealth of Massachusetts, and notice is hereby given
that this Agreement is executed by an officer of the LLC on behalf of its
trustees, as trustees and not individually, on further behalf of each Fund, and
that the obligations of this Contract as they relate to each Fund shall be
binding upon the assets and properties of that Fund only and shall not be
binding upon the assets and properties of any other Fund or series of the LLC or
upon any of the trustees, officers, employees, agents or shareholders of a Fund
or the LLC individually.
A-4
IN WITNESS WHEREOF, the parties hereto cause this Contract to be executed
by their officers designated below as of the date first above-written.
----------------------------------------------------------------------------------------------
WM TRUST I, on behalf of its series: WM STRATEGIC ASSET MANAGEMENT
----------------------------------------------------------------------------------------------
Money Market Fund PORTFOLIOS, LLC, on behalf of its series:
----------------------------------------------------------------------------------------------
Tax-Exempt Money Market Fund Strategic Growth Portfolio
----------------------------------------------------------------------------------------------
U.S. Government Securities Fund Conservative Growth Portfolio
----------------------------------------------------------------------------------------------
Income Fund Balanced Portfolio
----------------------------------------------------------------------------------------------
High Yield Fund Flexible Income Portfolio
----------------------------------------------------------------------------------------------
Tax-Exempt Bond Fund Conservative Balanced Portfolio
----------------------------------------------------------------------------------------------
Equity Income Fund
----------------------------------------------------------------------------------------------
Growth & Income Fund
----------------------------------------------------------------------------------------------
West Coast Equity Fund WM VARIABLE TRUST, on behalf of its
----------------------------------------------------------------------------------------------
Mid Cap Stock Fund series:
REIT Fund
----------------------------------------------------------------------------------------------
Money Market Fund
----------------------------------------------------------------------------------------------
U.S. Government Securities Fund
----------------------------------------------------------------------------------------------
WM TRUST II, on behalf of its series: Income Fund
----------------------------------------------------------------------------------------------
Short Term Income Fund Equity Income Fund
----------------------------------------------------------------------------------------------
California Money Fund Growth & Income Fund
----------------------------------------------------------------------------------------------
International Growth Fund West Coast Equity
----------------------------------------------------------------------------------------------
California Municipal Fund Mid Cap Stock Fund
----------------------------------------------------------------------------------------------
California Insured Intermediate Growth Fund
----------------------------------------------------------------------------------------------
Municipal Fund Small Cap Stock Fund
----------------------------------------------------------------------------------------------
Growth Fund International Growth Fund
----------------------------------------------------------------------------------------------
Small Cap Stock Fund Strategic Growth Portfolio
----------------------------------------------------------------------------------------------
Conservative Growth Portfolio
----------------------------------------------------------------------------------------------
Balanced Portfolio
----------------------------------------------------------------------------------------------
Flexible Income Portfolio
----------------------------------------------------------------------------------------------
Conservative Balanced Portfolio
----------------------------------------------------------------------------------------------
Each by:
Xxxxxxx X. Xxxxxx
President
PFPC, INC. WM SHAREHOLDER SERVICES, INC.
By: ______________________________
______
Its: ______________________________ Xxxxx X. Xxxxxx
First Vice President
SCHEDULE A
A-5
SERVICES PROVIDED BY PFPC AND OVERSEEN BY WMSS*
1. Shareholder Information. PFPC shall maintain a record of the number
of Shares held by each Shareholder of record which shall include name, address,
taxpayer identification and which shall indicate whether such Shares are held in
certificates or uncertificated form.
2. Shareholder Services. PFPC shall respond as appropriate to all
inquiries and communications from Shareholders relating to Shareholder accounts
with respect to its duties hereunder and as may be from time to time mutually
agreed upon between PFPC and WMSS.
3. Mailing Communications to Shareholders; Proxy Materials. PFPC will
address and mail to Shareholders of the Funds, all reports to Shareholders,
dividend and distribution notices and proxy material for the Funds' meetings of
Shareholders. In connection with meetings of Shareholders, PFPC will prepare
Shareholder lists, mail and certify as to the mailing of proxy materials,
process and tabulate returned proxy cards, report on proxies voted prior to
meetings, act as inspector of election at meetings and certify Shares voted at
meetings.
4. Sales of Shares.
PFPC shall not be required to record as sold any Shares of a Fund
where it has received a Written Instruction from WMSS or official notice from
any appropriate authority that the sale of the Shares of such Fund has been
suspended or discontinued. The existence of such Written Instructions or such
official notice shall be conclusive evidence of the right of PFPC to rely on
such Written Instructions or official notice.
In the event that any check or other order for the payment of money
is returned unpaid for any reason, PFPC will endeavor to: (i) give prompt notice
of such return to WMSS or its designee; (ii) place a stop transfer order against
all Shares recorded as sold in reliance on such check or order; and (iii) take
such other actions as PFPC may from time to time deem appropriate.
5. Transfer and Repurchase.
(a) PFPC shall process all requests to transfer or redeem Shares in
accordance with the transfer or repurchase procedures set forth in the Funds'
Prospectus.
(b) PFPC will transfer or repurchase Shares upon receipt of Oral or
Written Instructions or otherwise pursuant to the Prospectus and Share
certificates, if any, properly endorsed for transfer or redemption, accompanied
by such documents as PFPC reasonably may deem necessary.
____________________
* Note: Capitalized terms used in this Schedule A without definition
have the meanings given them in the Services Agreement.
A-6
PFPC reserves the right to refuse to transfer or repurchase Shares
until it is satisfied that the endorsement on the instructions is valid and
genuine. PFPC also reserves the right to refuse to transfer or repurchase Shares
until it is satisfied that the requested transfer or repurchase is legally
authorized, and it shall incur no liability for the refusal, in good faith, to
make transfers or repurchases which PFPC, in its good judgment, deems improper
or unauthorized, or until it is reasonably satisfied that there is no basis to
any claims adverse to such transfer or repurchase.
When Shares are redeemed, PFPC shall, upon receipt of the
instructions and documents in proper form, deliver to the Custodian and the
respective Fund or its designee a notification setting forth the number of
Shares to be repurchased. Such repurchased shares shall be reflected on
appropriate accounts maintained by PFPC reflecting outstanding Shares of such
Fund and Shares attributed to individual accounts.
PFPC shall, upon receipt of the monies provided to it by the
Custodian for the repurchase of Shares, pay such monies as are received from the
Custodian, all in accordance with the procedures described in the written
instruction received by PFPC from WMSS
PFPC shall not process or effect any repurchase with respect to
Shares of any Fund after receipt by PFPC or its agent of notification of the
suspension of the determination of the net asset value of such Fund.
6. Dividends.
(a) Upon the declaration of each dividend and each capital gains
distribution by the Board of Directors of the Funds with respect to Shares of
such Fund, WMSS shall furnish or cause to be furnished to PFPC Written
Instructions setting forth the date of the declaration of such dividend or
distribution, the ex-dividend date, the date of payment thereof, the record date
as of which Shareholders entitled to payment shall be determined, the amount
payable per Share to the Shareholders of record as of that date, the total
amount payable on the payment date and whether such dividend or distribution is
to be paid in Shares at net asset value.
On or before the payment date specified in such resolution of the
Board of Directors, the Fund will provide PFPC with sufficient cash to make
payment to the Shareholders of record as of such payment date.
If PFPC does not receive sufficient cash from the Fund to make
total dividend and/or distribution payments to all Shareholders of the Fund as
of the record date, PFPC will, upon notifying WMSS, withhold payment to all
Shareholders of record as of the record date until sufficient cash is provided
to PFPC.
7. In addition to and neither in lieu nor in contravention of the
services set forth above, PFPC shall perform all the customary services of a
transfer agent, registrar, dividend disbursing agent and agent of the dividend
reinvestment and cash purchase plan as described herein consistent with those
requirements in effect as at the date of the Services Agreement. The
A-7
detailed definition, frequency, limitations and associated costs (if any) set
out in Schedule D to the Contract, include but are not limited to: maintaining
all Shareholder accounts, preparing Shareholder meeting lists, mailing proxies,
tabulating proxies, mailing Shareholder reports to current Shareholders,
withholding taxes on U.S. resident and non-resident alien accounts where
applicable, preparing and filing U.S. Treasury Department Forms 1099 and other
appropriate forms required with respect to dividends and distributions by
federal authorities for all Shareholders.
8. In addition PFPC shall: (a) establish and implement written internal
policies, procedures and controls reasonably designed to prevent PFPC, with
respect to the WM Group of Funds, from being used to launder money or finance
terrorist activities and to achieve compliance with the Bank Secrecy Act; (b)
provide for independent testing, by an employee who is not responsible for the
operation of PFPC's AML program or by an outside party, for compliance with
PFPC's established policies and procedures; (c) designate a person or persons
responsible for implementing and monitoring the operation and internal controls
of PFPC's AML program; and (d) provide ongoing training of PFPC personnel
relating to the prevention of money-laundering activities. Upon the reasonable
request of the Fund, PFPC shall provide to the Fund: (x) a copy of PFPC's
written AML policies and procedures (it being understood such information is to
be considered confidential and treated as such and afforded all protections
provided to confidential information under this agreement); (y) at the option of
PFPC, a copy of a written assessment or report prepared by the party performing
the independent testing for compliance, or a summary thereof, or a certification
that the findings of the independent party do not adversely implicate PFPC's
satisfaction of its obligations set forth herein; and (z) a summary of the AML
training provided for appropriate personnel. PFPC agrees to permit inspections
relating to its AML program by U.S. Federal departments or regulatory agencies
with appropriate jurisdiction and to make available to examiners from such
departments or regulatory agencies such information and records relating to its
AML program as such examiners shall reasonably request.
A-8
SCHEDULE B
SERVICES PROVIDED BY WMSS
I. Shareholder Services
A. Maintain all Shareholder records on electronic data processing
equipment, including:
1. Share balances
2. Account transaction history
3. Names and addresses
4. Distribution records
5. Transfer records
6. Over-all control records
B. New Accounts
1. Deposit all monies received into a Fund custody account
maintained by the Fund's custodian.
2. Set up account according to Shareholders' instructions
3. Issue and mail shareholder confirmations
C. Additional Purchases
1. Deposit monies received into a Fund custody account maintained
by the Fund's custodian.
2. Issue Shareholder confirmations
D. Redemptions
Liquidate shares upon Shareholder request
1. Make payments of redemption proceeds in accordance with the
Fund's then current prospectus.
2. Issue and mail Shareholder confirmation
B-1
E. Transfer shares as requested, including obtaining necessary papers and
documents to satisfy transfer requirements. On irregular transfers
requiring special legal opinions, such special legal fees, if any, are
to be paid for by the Fund.
F. Process changes, corrections of addresses and registrations
G. Maintain service with Shareholders as follows:
1. Activity required to receive, process and reply to Shareholders'
correspondence regarding account matters
2. Refer correspondence regarding investment matters to the Fund with
sufficient account data to answer
3. Contact Shareholders directly to settle problems and answer
questions
H. Compute distributions, dividends and capital gains
1. Make payment or reinvest in additional shares as directed by
shareholders according to provisions of the Fund's then current
prospectus
2. Advise each Shareholder of the amount of dividends received and
tax status annually
I. Produce transcripts of shareholder account history as required
J. Maintain the controls associated with the computer programs and manual
systems to arrive at the Fund's total shares outstanding
K. Receive mail and perform other administrative functions relating to
transfer agent work
II. Other Services
A. Mailing services to shareholders
B. Services in connection with any stock splits
C. Develop special reports for Fund officers regarding statistical and
accounting data pertaining to the Fund. Fund shall pay for
out-of-pocket expenses charged by vendors to develop such reports or
portions thereof
D. Voice response unit
B-2
E. NSCC support
F. WMSS shall: (a) establish and implement written internal policies,
procedures and controls reasonably designed to prevent WMSS, with
respect to the WM Group of Funds, from being used to launder money or
finance terrorist activities and to achieve compliance with the Bank
Secrecy Act; (b) provide for independent testing, by an employee who
is not responsible for the operation of WMSS 's AML program or by an
outside party, for compliance with WMSS 's established policies and
procedures; (c) designate a person or persons responsible for
implementing and monitoring the operation and internal controls of
WMSS 's AML program; and (d) provide ongoing training of WMSS
personnel relating to the prevention of money-laundering activities.
Upon the reasonable request of the Fund, WMSS shall provide to the
Fund: (x) a copy of WMSS's written AML policies and procedures (it
being understood such information is to be considered confidential and
treated as such and afforded all protections provided to confidential
information under this agreement); (y) at the option of WMSS, a copy
of a written assessment or report prepared by the party performing the
independent testing for compliance, or a summary thereof, or a
certification that the findings of the independent party do not
adversely implicate WMSS's satisfaction of its obligations set forth
herein; and (z) a summary of the AML training provided for appropriate
personnel. WMSS agrees to permit inspections relating to its AML
program by U.S. Federal departments or regulatory agencies with
appropriate jurisdiction and to make available to examiners from such
departments or regulatory agencies such information and records
relating to its AML program as such examiners shall reasonably request
B-3
SCHEDULE C
WMSS MONTHLY FEES
January __, 2003
Fee Per Account Per Month*
-------------------------
Open Closed
---- ------
Equity Funds $19.68/12 $2.03/12**
Fixed Income Funds $20.21/12 $2.03/12**
Money Market Funds $25.01/12 $2.03/12**
Fees Include:
[X] Shareholder and Broker Servicing
[X] Transaction Processing, Correspondence, and Research
[X] Settlement and Reconciliation
[X] Corporate Actions
[X] Tax Reporting and Compliance
[X] NSCC Support (excluding any fees paid to NSCC)
[X] Management Company and Broker/Dealer Support
[X] Asset Allocation Processing for all distribution channels
[X] 50% of NQR fees
In addition, WMSS will be paid an annual anti-money laundering services fee,
calculated and paid monthly as follows:
Number of open accounts Annual Fee
----------------------- ----------
1,000,000+ $50,000
500,000-1,000,000 $35,000
100,000-499,999 $26,000
50,000-99,999 $13,000
10,000-49,999 $ 6,000
fewer than 10,000 $ 3,000
The anti-money laundering services fee for the period from the date hereof until
the end of the year shall be prorated according to the proportion that such
period bears to the full annual period.
Additional charges will be made for out-of-pocket expenses according to Schedule
E.
This amount shall be reduced by a $200,000 one-time credit for previous DAZL
usage to be applied on the January 2003 invoice for services rendered
C-1
* No fee is paid by WM Variable Trust.
** Each year, effective on the anniversary date of the Services Agreement, the
per account fee will increase by a percentage equal to an amount one percent
greater than the Consumer Price Index as reported monthly by Bloomberg Financial
Markets and Commodity News in the month preceding the effective date of the
increase. This provides WMSS an opportunity to pass through any inflationary
increases in PFPC's closed Account fees.
C-2
SCHEDULE D
PFPC MONTHLY FEES*
1) Per Account Fees (per annum, except for Medical Savings Accounts):
(Effective January 1, 2003)
Open Accounts $15.28 per Account
Closed Accounts $2.03 per Account
NSCC Level III Accounts $8.15 per Account
Each year, effective on the anniversary date of the Services Agreement, the per
account fee will increase by a percentage equal to an amount one percent greater
than the Consumer Price Index as reported monthly by Bloomberg Financial Markets
and Commodity News in the month preceding the effective date of the increase.
This provides PFPC with an opportunity to manage uncontrollable expenses due to
inflationary increases.
In addition, PFPC charges the following annual fees directly to
shareholders:
Simple XXX Accounts $10.00 per open Account*
403(b) Accounts $10.00 per open Account*
Medical Savings Accounts $10.00 per Account
(year account is established only)
* Fee will be waived in the event the value of the Global Account (single
account number and same registration across all Fund positions) exceeds $10,000
at the time the fee is to be assessed.
2) Variable Annuity Fees:
$1,000 per month per Portfolio for the first six variable annuity
Portfolios;
$500 per month per Portfolio for each additional variable annuity
Portfolio.
______________
* Note: Capitalized terms used in this Schedule D without definition have the
meanings given them in the Services Agreement.
D-1
3) Dedicated Systems Development Team: $275,000 per annum
The current WMSS Dedicated Team consists of 1.5 programmers, .5 system
manager and .5 BSA for a fee of $275,000.00 annually. WMSS may reduce the
staffing of the Dedicated Team by 1 programmer upon 90 days prior written
notice. In the event WMSS so reduces the staffing of the Dedicated Team the
annual rate shall be reduced to $175,000 per annum. Following such
reduction in staffing, WMSS may increase the staffing level to the original
deployment stated above upon 120 days written notice to PFPC at which point
the per annum fee shall revert to the original fee described above..
WMSS may discontinue deployment of a Dedicated Team at any time upon 90
days written notice to PFPC. In the event of such termination, WMSS shall
be responsible for the pro rata share of the stated annual dedicated System
Development Team fee.
The number of hours worked, projects and status will be reported monthly.
Non-Dedicated Team: $100.00 per hour.
4) Anti-Money Laundering Fees:
WMSS will pay PFPC an annual anti-money laundering services fee, calculated and
paid monthly as follows:
Number of open accounts Annual Fee
----------------------- ----------
1,000,000+ $50,000
500,000-1,000,000 $35,000
100,000-499,999 $26,000
50,000-99,999 $13,000
10,000-49,999 $ 6,000
fewer than 10,000 $ 3,000
Transfer Agency Fees Include:
.. Shareholder and Broker Servicing
.. Transaction Processing, Correspondence, and Research
.. Settlement and Reconciliation
.. Corporate Actions
.. Tax Reporting and Compliance
.. NSCC Support
.. Management Company and Broker/Dealer Support
.. Asset Allocation Processing for all distribution channels
D-2
.. 50% of NQR fees
Additional Transfer Agency Fees:
.. NSCC charges
.. Banking fees
.. Standard out-of-pocket expenses
Value Added Transfer Agency Services:
1. DAZL Pricing:
Monthly Usage Fee: $1,000.00
Transmission Charge: $.03 per record (Price record transmission cost is
$.015 per record.)
Annual Cap: $50,000 per year
This amount shall be reduced by a $200,000 one-time credit for previous
DAZL usage to be applied on the January 2003 invoice for services rendered
2. Voice Response Unit (VRU)
$.29 per minute maintenance charge
ADVANCED OUTPUT SOLUTIONS (Print/Mail)
SAMP and non-SAMP consolidated and duplex statements: Estimate $400,000 (waived)
To be completed by Q3 2003
Modification to accommodate E-Notification and Shareholder Statement
Suppression:
Estimate $38,400 (waived)
Printing / Processing
Simplex black and white laser printing $0.08
Duplex black and white laser printing $0.08 per side
Per image check printing $0.10
Inserting (Daily Minimums Apply)
Confirms Machine inserting per page (includes BRE or CRE) $42/K - $50.00 Min
Confirms Hands inserting per page (includes BRE or CRE) $71K - $75.00 Min
Statements Machine inserting per page (includes BRE or CRE) $52/K - $75.00 Min
D-3
Statements Hands inserting per page (includes BRE or CRE) $78/K - $75.00 Min
Checks Machine inserting per page (includes BRE or CRE) $52/K - $75.00 Min
Checks Hands inserting per page (includes BRE or CRE) $78/K - $100.00Min
Periodic Checks Hands $78/K - $100.00Min
Periodic Checks Machine $52/K - $100.00Min
Additional inserts Hand $0.08
Additional Inserts Machine $0.01
Intelligent Inserting Hand $125/K
Intelligent Inserting Machine $58/K
Per piece mail preparation / presort fee $0.035
Workorder administration fee $7.00
Manual pulls $2.50
Shipping / Inventory
Non-USPS courier support / package $4.50
Inventory receipts / S.K.U. $20.00
Inventory storage / location / month - per skid $20.00
Inventory Dump/Destruct Charge $20.00
Courier Charge $15.00
Special Mailing
Workorder Administration fee $15.00
Creation of Admark Tape $135.00
ZIP+4 Data Enhancement $10/K - $125.00Min
Data Manipulation $80/Hour
Combo Charge $6/K - $75.00 Min
Admark & Machine insert #10 or 6x9 (includes 1 piece) $62/K - $125.00Min
Admark & Machine insert 9x12 (includes 1 piece) $100/K-$125.00Min
Additional Machine insert #10 or 6x9 $2.50/K
Additional Machine insert 9x12 $5/K
Additional Hand insert #10, 6x9 & 9x12 $0.08
Admark Only #10, 6x9 or 9x12 $38/K - $75.00 Min
Hand Sort $25/K
Print, Affix & Insert Pressure Sensitive labels $0.32 - $75.00 Min
Print Labels only $0.10
Affix Labels only $0.10
Legal Mail Drop $150.00 per job
Create Mailing List $.40 per rec-$75Min
Copy of 3602 or 3606 per Mailing $3.00
Miscellaneous Fees
Message $20.00 each
D-4
Folding - Machines $18/K
Folding - Hands $0.12 each
Cutting $10/K
Shipping Boxes $0.85
Oversized Envelopes $0.45
Faxes $3.00 per fax
Special Projects Hourly Work $24.00
CD Rom Fees
Per PDF image $0.05
Server storage, database and indexing per image $0.01
Per original CD $225.00
Per duplicate CD $175.00
Courier/run $40.00
*Internet presentment, email notification and portal fees not included.
Programming Expenses
Systems Testing $100/Hour
Forms Development/Programming $100/Hour
Tax Form Output Processing
Print & Process $0.42
Workorder Administration Fee $15.00
Minimum Processing/Job $75.00
Dupe Tax Forms $0.50 Each -$15Min
Intelligent Inserting $0.045
Additional Machine insert $0.01
Additional Hands insert $0.07
Affidavit Charge $3.50 Each
D-5
Exhibit 1 of Schedule D
Performance Standards
Revised as of April 1, 2002
PFPC's obligation to meet the "Standard Performance Range" for each of the
following Performance Standards shall be measured in the aggregate with respect
to all Funds.
1. Transaction Processing
Transaction Performance Standards
Performance will be measured quarterly by National Quality Review ("NQR")
based on its then-current standard sampling methodology. Currently, that
methodology involves approximately 800 account transactions each quarter.
NQR reviews transactions for accuracy, timeliness and completeness.
Beginning with the 2001 fourth quarter NQR report, if, for the current
quarter, the percentage of the transactions sampled by NQR represented by
transactions for which no "exceptions" were noted falls within the "Penalty
Range" or "Award Range" (as defined below), the PFPC Monthly Fees next
invoiced by PFPC following receipt of the NQR quarterly data shall be
reduced by the applicable penalty, or increased by the applicable award, as
shown in Section 4 of this Exhibit 1. The WMSS Monthly Fees for the same
period will also be reduced by any applicable penalty, but shall not be
increased by any applicable award.
The PFPC Monthly Fees next invoiced by PFPC following receipt of the NQR
quarterly data will be increased by an additional award, as shown in
Section 4 of this Exhibit 1 under the
D-6
heading "NQR Best in Class" if the quarterly Overall Accuracy rating
matches the highest overall NQR rating earned by any firm evaluated by NQR
for the quarter to which such data relates.
Penalties or rewards will be assessed quarterly based on quarterly
performance scores, excluding reclassified items, as provided by NQR.
The "Penalty Range" is any percentage below the standard performance range
most recently determined by NQR for the previous calendar year (the
"Standard Performance Range"). The "Award Range" is any percentage above
the Standard Performance Range. The "Award Range" is further divided in
half with a midpoint that falls between the top of the "Standard
Performance Range" and the "Best in Class score" as determined each
quarter. At present, the Penalty Range, the Standard Performance Range and
Award Range are as follows:
-----------------------------------------------------------------------------------------------------------------------
Unacceptable - Standard Performance Award Range - Lower Award Range -
Transaction Type Penalty Range Range Half Upper Half
-----------------------------------------------------------------------------------------------------------------------
Financial Accuracy *96.6% 96.6% - 98.6% **98.6% - Midpoint -
*Midpoint Best-In-Class
-----------------------------------------------------------------------------------------------------------------------
Non-Financial **95.1% - Midpoint -
Accuracy *88.1% 88.1% - 95.1% *Midpoint Best-In-Class
-----------------------------------------------------------------------------------------------------------------------
**96.3% - Midpoint -
Overall Accuracy *92.6% 92.6% - 96.3% *Midpoint Best-In-Class
-----------------------------------------------------------------------------------------------------------------------
* Denotes less than
** Denotes greater than
Other Transaction Processing Obligations
The following factors will not be part of the award or penalty structure;
however, they are obligations of PFPC.
. Financial Processing Timeliness, as determined quarterly by NQR, will
be at least the NQR average. Timeliness is defined as the percent of
financial transactions
D-7
processed the same day that they are received in good order.
. Non-Financial Adjustments and legal transfers will be completed within
three days of receipt.
. Maintenance (including address changes, account option changes,
ROA/LOI) will be completed within 5 days of receipt.
. Financial Items will receive 100% Quality Control the same day they
are processed.
2. Telephone Service Quality
Performance will be measured quarterly by NQR based on its then-current standard
sampling methodology. Currently, that methodology is a review of 120 calls per
quarter using NQR's 27-point evaluation process. NQR reviews transactions for
accuracy, timeliness and completeness. Beginning with the 2001 fourth quarter
NQR report, if, for the current quarter, the percentage of the transactions
sampled by NQR represented by transactions for which no "exceptions" were noted
falls within the "Penalty Range" or "Award Range" (as defined below), the PFPC
Monthly Fees next invoiced by PFPC following receipt of the NQR quarterly data
shall be reduced by the applicable penalty, or increased by the applicable
award, as shown in Section 4 of this Exhibit 1. The WMSS Monthly Fees for the
same period will also be reduced by any applicable penalty, but shall not be
increased by any applicable award.
The PFPC Monthly Fees next invoiced by PFPC following receipt of the NQR
quarterly data will be increased by an additional award, as shown in Section 4
of this Exhibit 1 under the heading "NQR Best in Class" if the quarterly Overall
Call Center rating matches the highest overall NQR rating earned by any firm
evaluated by NQR for the quarter to which such data relates.
The "Penalty Range" is any percentage below the standard performance range most
recently determined by NQR for the previous calendar year (the "Standard
Performance Range"). The "Award Range" is any percentage above the Standard
Performance Range. The "Award Range" is further divided in half with a midpoint
that falls between the top of the "Standard Performance Range" and the "Best in
Class score" as determined each quarter. At present, the Penalty Range, the
Standard Performance Range and Award Range are as follows:
D-8
-----------------------------------------------------------------------------------------------------
Standard
Unacceptable - Performance Award Range - Award Range -
Transaction Type Penalty Range Range Lower Half Upper Half
-----------------------------------------------------------------------------------------------------
Telephone **2.71 - Midpoint -
Service Quality *2.33 2.33 - 2.71 *Midpoint - Best-In-Class
-----------------------------------------------------------------------------------------------------
* Denotes less than
** Denotes greater than
Other Service Quality Obligations
These factors will not be part of the award or penalty structure; however,
they are obligations of PFPC that PFPC shall not fail to meet for any two months
of any rolling four-month period:
. Call Answer Rate as measured by the PFPC's Call Monitoring System will
maintain a monthly standard of at least 98%.
. Average Speed of Answer as measured by PFPC's Call Monitoring System
will be no greater than 20 seconds for each month.
. Financial Correspondence will be mailed within two days of receipt.
. Non-Financial Correspondence will be mailed within four days of
receipt.
. Correspondence rating, as measured by NQR, will be at least a 3.5.
3. Print Mail Service Standards
These performance standards are in effect only for those mailings where
services are provided by PFPC.
. Shareholder redemption checks mailed on day of receipt.
. Confirmations mailed within one business day of receipt.
. Statements mailed within five business days following the end of the
reporting period.
. Commission checks mailed within five business days following the end
of the reporting period.
. Statements available to WMSS on CD ROM 15 business days after each
quarter-end.
D-9
. All IRS tax forms mailed within the regulatory requirements.
4. Penalty and Award
-----------------------------------------------------------
Transaction Processing Quarterly Payments
-----------------------------------------------------------
Financial
---------
-----------------------------------------------------------
Unacceptable - Penalty $12,500
-----------------------------------------------------------
Standard $ 0
-----------------------------------------------------------
Award - Lower Half $ 6,250
-----------------------------------------------------------
Award - Upper Half $12,500
-----------------------------------------------------------
Non Financial
-------------
-----------------------------------------------------------
Unacceptable - Penalty $12,500
-----------------------------------------------------------
Standard $ 0
-----------------------------------------------------------
Award - Lower Half $ 6,250
-----------------------------------------------------------
Award - Upper Half $12,500
-----------------------------------------------------------
Overall
-------
-----------------------------------------------------------
Unacceptable - Penalty $25,000
-----------------------------------------------------------
Standard $ 0
-----------------------------------------------------------
Award - Lower Half $12,500
-----------------------------------------------------------
Award - Upper Half $25,000
-----------------------------------------------------------
NQR Best-In-Class* $25,000
-----------------------------------------------------------
-----------------------------------------------------------
Call Center Quarterly Payments
-----------------------------------------------------------
Overall
-------
-----------------------------------------------------------
Unacceptable - Penalty $50,000
-----------------------------------------------------------
Standard $ 0
-----------------------------------------------------------
Award - Lower Half $25,000
-----------------------------------------------------------
Award - Upper Half $50,000
-----------------------------------------------------------
NQR Best-In-Class* $25,000
-----------------------------------------------------------
* NQR Best-In-Class is WMGF scores matching the highest NQR rating of all firms
evaluated during the quarter.
Total potential Annual Penalties - $400,000
Total potential Annual Awards - $400,000 + $200,000 for NQR Best-In-Class
D-10
The parties agree to review all NQR standards annually and update such
standards effective as of the beginning of the 2/nd/ quarter of each year to
accurately reflect the then current NQR quality ratings.
D-11
SCHEDULE E
OUT-OF-POCKET EXPENSES
The Funds shall reimburse WMSS monthly for applicable out-of-pocket expenses,
including, but not limited to the following items:
X NSCC charges
X Banking fees
X Voice response unit
X Microfiche/Microfilm/Image production
X Magnetic media tapes and freight
X Printing costs, including certificates, envelopes, checks and
stationery
X Postage (bulk, pre-sort, ZIP+4, bar-coding, first class) direct pass
through to the Funds
X Due diligence mailings
X Telephone and telecommunication costs, including all lease,
maintenance and line costs
X Ad hoc reports
X Shareholder transcripts
X Proxy solicitations, mailings and tabulations
X Daily & Distribution advice mailings
X Shipping, Certified and Overnight mail and insurance
X Year-end form production and mailings
X Terminals, communication lines, printers and other equipment and any
expenses incurred in connection with such terminals and lines
X Duplicating services
X Courier services
X Incoming and outgoing wire charges
X Federal Reserve charges for check clearance
X Travel and entertainment, as approved by the Funds
X Record retention, retrieval and destruction costs, including, but not
limited to exit fees charged by third party record keeping vendors
X Third party audit reviews
X Insurance
X Such other miscellaneous expenses reasonably incurred by WMSS in
performing its duties and responsibilities under this Agreement
X 50% of NQR fees
The Funds shall reimburse PFPC monthly for applicable out-of-pocket expenses,
including, but not limited to: Telephone lines, forms, envelopes, postage,
overnight delivery, mailgrams, hardware/phone lines for transmissions,
microfilm/microfiche, wire fees, ACH charges, exchange fees, proxies, record
retention, b/c notices, consolidated statements, account
E-1
transcripts, audio response, ad hoc reports/labels/user tapes, conversion
expenses, [development/programming costs], travel expenses, training expenses
and expenses incurred at the direction of the Fund.
The Funds shall reimburse PFPC monthly for shareholder expenses including,
but not limited to, expenses for: returned checks; lost certificate bonding;
overnight delivery as requested by the shareholder; wire fee for disbursement if
requested by the shareholder, and all other miscellaneous fees incurred on
behalf of the Fund. The Funds shall not be separately charged for XXX/Xxxxx
processing, requests for account transcripts, or exchanges between Funds.
E-2
