Exhibit 99(h)
TRANSFER AGENCY AND SERVICE AGREEMENT
BETWEEN
EACH OF THE ENTITIES LISTED ON APPENDIX A
AND
BOSTON FINANCIAL DATA SERVICES, INC.
TABLE OF CONTENTS
PAGE
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1. Terms of Appointment and Duties 1
2. Intentionally Omitted
3. Fees and Expenses 6
4. Representations and Warranties of the Transfer Agent 7
5. Representations and Warranties of the Fund 7
6. Wire Transfer Operating Guidelines 8
7. Data Access and Proprietary Information 9
8. Indemnification 11
9. Standard of Care/Limitation on Liability 13
10. Confidentiality 13
11. Covenants of the Fund and the Transfer Agent 14
12. Termination of Agreement 15
13. Assignment and Third Party Beneficiaries 16
14. Subcontractors 17
15. Miscellaneous 17
16. Additional Funds/Portfolios 19
17. Limitations of Liability of the Trustees and Shareholders 20
Appendix A Funds and Portfolios
Schedule 1.2(f) AML Delegation
Schedule 1.3 Service Level Agreement
Schedule 3.1 Fees and Expenses
Schedule 9 Transfer Agent's Liability
TRANSFER AGENCY AND SERVICE AGREEMENT
THIS AGREEMENT made as of the 1st day of October, 2005, by and between each
of the entities listed on Appendix A hereto and each being an entity of a type
as set forth on Appendix A and organized under the laws of the state as set
forth on Appendix A, each with place of business at 0 Xxxxx XxXxxxx Xxxxxx,
Xxxxx 000, Xxxxxxx, XX 00000 and each of which is acting on its own behalf and
on behalf of each of the portfolios listed under its name on Appendix A, but not
jointly with any other entities listed on Appendix A (each such entity, together
with its Portfolios (as defined below), shall be severally referred to as the
"Fund") and BOSTON FINANCIAL DATA SERVICES, INC., a
Massachusetts corporation
having its principal office and place of business at Xxx Xxxxxxxx Xxxxx, Xxxxxx,
Xxxxxxxxxxxxx 00000 (the "Transfer Agent").
WITNESSETH:
WHEREAS, each Fund currently set forth on Appendix A is a trust registered with
the Securities and Exchange Commission as an investment company pursuant to the
Investment Company Act of 1940, as amended; and
WHEREAS, each Fund currently set forth on Appendix A is authorized to issue
shares in separate series, with each such series representing interests in a
separate portfolio of securities and other assets (each such series, together
with all other series subsequently established by the Fund and made subject to
this Agreement in accordance with SECTION 16 being herein referred to severally
as the Fund's "Portfolios"); and
WHEREAS, it is contemplated that additional Funds and their Portfolios may
become parties to this Agreement by mutual consent of the parties hereto and by
execution of a counterpart signature page to this Agreement subject to the
provisions of SECTION 16 hereto; and
WHEREAS, the Fund (as used herein "the Fund" shall refer severally to each
entity listed on Appendix A together with its Portfolios) on behalf of the
Portfolios desires to appoint the Transfer Agent as its transfer agent, dividend
disbursing agent and agent in connection with certain other activities, and the
Transfer Agent desires to accept such appointment.
NOW, THEREFORE, in consideration of the mutual covenants herein contained, the
parties hereto agree as follows:
1. TERMS OF APPOINTMENT AND DUTIES
1.1 TRANSFER AGENCY SERVICES. Subject to the terms and conditions set forth in
this Agreement, the Fund, on behalf of the Portfolios, hereby employs and
appoints the Transfer Agent to act as, and the Transfer Agent agrees to act
as, its transfer agent for the Fund's authorized and issued shares of its
beneficial interest ("Shares"), dividend disbursing agent and agent in
connection with any accumulation, open-account or similar plan provided to
the shareholders of each of the respective Portfolios of the Fund
("Shareholders") and set out in the currently effective prospectus(es) and
statement(s) of additional information ("prospectus") of the Fund on behalf
of the applicable Portfolio,
including without limitation any periodic investment plan or periodic
withdrawal program. In accordance with the prospectus and the procedures
established from time to time by agreement between the Fund on behalf of
each of the Portfolios, as applicable and the Transfer Agent, the Transfer
Agent agrees that it will perform the following services:
(a) Receive for acceptance, orders for the purchase of Shares, and promptly
deliver payment and appropriate documentation thereof to the Custodian of
the Fund authorized pursuant to the Trust Instrument of the Fund (the
"Custodian");
(b) Pursuant to purchase orders, issue the appropriate number of Shares
and hold such Shares in the appropriate Shareholder account;
(c) Receive for acceptance redemption requests and redemption directions
and deliver the appropriate documentation thereof to the Custodian;
(d) In respect to the transactions in items (a), (b) and (c) above, the
Transfer Agent shall execute transactions directly with broker-dealers
authorized by the Fund;
(e) At the appropriate time as and when it receives monies paid to it by
the Custodian with respect to any redemption, pay over or cause to be paid
over in the appropriate manner such monies as instructed by the redeeming
Shareholders;
(f) Effect transfers of Shares by the registered owners thereof upon
receipt of appropriate instructions;
(g) Prepare and transmit payments for dividends and distributions declared
by the Fund on behalf of the applicable Portfolio;
(h) Issue replacement certificates for those certificates alleged to have
been lost, stolen or destroyed upon receipt by the Transfer Agent of
indemnification satisfactory to the Transfer Agent and protecting the
Transfer Agent and the Fund, and the Transfer Agent at its option, may
issue replacement certificates in place of mutilated stock certificates
upon presentation thereof and without such indemnity;
(i) Issue replacement checks and place stop orders on original checks based
on Shareholder's representation that a check was not received or was lost.
Such stop orders and replacements will be deemed to have been made at the
request of the Fund, and the Fund shall be responsible for all losses or
claims resulting from such replacement;
(j) Maintain records of account for and advise the Fund and its
Shareholders as to the foregoing;
(k) Record the issuance of Shares of the Fund and maintain pursuant to Rule
17Ad-10(e) under the Securities and Exchange Act of 1934, as amended, a
record of the total number of Shares of the Fund which are authorized,
based upon data provided to it by the Fund, and issued and outstanding. The
Transfer Agent shall also provide the Fund on a regular
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basis with the total number of Shares which are authorized and issued and
outstanding and shall have no obligation, when recording the issuance of
Shares, to monitor the issuance of such Shares or to take cognizance of any
laws relating to the issue or sale of such Shares, which functions shall be
the sole responsibility of the Fund;
(l) Maintain such bank accounts (demand deposit accounts or "DDAs") as the
Transfer Agent shall deem necessary to the performance of its duties
hereunder, including, but not limited to, the processing of Share purchases
and redemptions and the payment of Portfolio dividends;
(m) Report abandoned property to state authorities as authorized by the
Fund in accordance with the policies and procedures agreed upon by the Fund
and the Transfer Agent;
(n) Provide Shareholder proxy coordination;
(o) Provide Shareholder account information through various means,
including but not limited to, telephone calls, correspondence and research;
(p) Monitor transactions in the Fund for market timing activity in
accordance with the specifications and procedures agreed upon by the
parties in writing, which may be amended from time to time. The services
provided under this SECTION 1.1(p) will be ministerial only and such
monitoring will not subject the Transfer Agent to any liability for failure
to detect market timing activity; provided, however that the Transfer Agent
shall be liable for its willful misconduct in connection with performing
the services in this SECTION 1.1(p); and
(q) Account for and administer the redemption fees on the redemption and
exchange of Shares.
1.2 ADDITIONAL SERVICES. In addition to, and neither in lieu nor in
contravention of, the services set forth in the above paragraph, the
Transfer Agent shall perform the following services:
(a) OTHER CUSTOMARY SERVICES. Perform the customary services of a transfer
agent, dividend disbursing agent and, as relevant, agent in connection with
accumulation, open-account or similar plan (including without limitation
any periodic investment plan, DRIP or periodic withdrawal program),
including but not limited to: maintaining all Shareholder accounts,
preparing Shareholder meeting lists, mailing Shareholder proxies,
Shareholder reports and prospectuses to current Shareholders, withholding
taxes on U.S. resident and non-resident alien accounts, 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, preparing and mailing confirmation forms and
statements of account to Shareholders for all purchases and redemptions of
Shares and other confirmable transactions in Shareholder accounts,
preparing and mailing activity statements for Shareholders, providing
Shareholder
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account information and coordinating with and overseeing the print/mail
vendor in accordance with the provisions of SECTION 14.1 below;
(b) CONTROL BOOK (ALSO KNOWN AS "SUPER SHEET"). Maintain a daily record and
produce a daily report for the Fund of all transactions and receipts and
disbursements of money and securities and deliver a copy of such report for
the Fund for each business day to the Fund no later than 9:00 AM Eastern
Time, or such earlier time as the Fund may reasonably require, on the next
business day;
(c) "BLUE SKY" REPORTING. The Fund shall (i) identify to the Transfer Agent
in writing those transactions and assets to be treated as exempt from blue
sky reporting for each State and (ii) verify the establishment of
transactions for each State on the system prior to activation and
thereafter monitor the daily activity for each State. The responsibility of
the Transfer Agent for the Fund's blue sky State registration status is
solely limited to the initial establishment of transactions subject to blue
sky compliance by the Fund and providing a system which will enable the
Fund to monitor the total number of Shares sold in each State;
(d) NATIONAL SECURITIES CLEARING CORPORATION (THE "NSCC"). (i) accept and
effectuate the registration and maintenance of accounts through Networking
and the purchase, redemption, transfer and exchange of shares in such
accounts through Fund/SERV (Networking and Fund/SERV being programs
operated by the NSCC on behalf of NSCC's participants, including the Fund),
in accordance with, instructions transmitted to and received by the
Transfer Agent by transmission from NSCC on behalf of broker-dealers and
banks which have been established by, or in accordance with the
instructions of authorized persons, as hereinafter defined on the dealer
file maintained by the Transfer Agent; (ii) issue instructions to Fund's
banks for the settlement of transactions between the Fund and NSCC (acting
on behalf of its broker-dealer and bank participants); (iii) provide
account and transaction information from the affected Fund's records on DST
Systems, Inc. computer system TA2000 ("TA2000 System") in accordance with
NSCC's Networking and Fund/SERV rules for those broker-dealers; (iv) comply
with NSCC rules and procedures applicable to the Transfer Agent's use of
Networking; (v) implement and maintain procedures reasonably designed to
ensure the accuracy of all transmissions through Networking and to limit
the access to, and the imputing of data into, Networking to persons
specifically authorized by the Transfer Agent; and (vi) otherwise perform
any and all duties, functions, procedures and responsibilities pursuant to
each NSCC matrix level and as otherwise established by NSCC from time to
time.
(e) NEW PROCEDURES. New procedures as to who shall provide certain of these
services in SECTION 1 may be established in writing from time to time by
agreement between the Fund and the Transfer Agent. The Transfer Agent may
at times perform only a portion of these services and the Fund or its agent
may perform these services on the Fund's behalf;
(f) ANTI-MONEY LAUNDERING ("AML") DELEGATION. The Fund has elected to
delegate to the Transfer Agent certain AML duties and customer
identification procedure ("CIP") duties under this Agreement and the
parties have agreed to such duties and terms as
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stated in the attached schedule (Schedule 1.2(f) entitled "AML
Delegation"), which may be changed from time to time subject to mutual
written agreement between the parties.
(g) LAWS AND REGULATION. The Transfer Agent will take reasonable steps to
stay informed of new securities and tax laws and regulations which apply to
the Transfer Agent's products and services hereunder and will take
reasonable steps to update its products and/or services to comply with new
securities and tax laws and regulations applicable to its transfer agency
business in the time and manner as required by such laws and regulations.
On a quarterly basis, upon request of the Fund, the Transfer Agent shall
provide the Fund with a Rule 38a-1 certification substantially in the
format previously provided to the Fund in connection with the negotiation
of this Agreement. The Transfer Agent reserves the right to amend and
update the form of its Rule 38a-1 certification from time to time to comply
with new or amended requirements of applicable law or to enhance its
Compliance+ program.
1.3 SERVICE LEVEL AGREEMENT. The Transfer Agent shall maintain a quality
control process designed to provide a consistent level of quality and
timeliness for its call center, correspondence services and transaction
processing and level of systems availability. The Transfer Agent's
performance of the services under this Agreement will be measured against
service levels and standards ("SLAs"), which will be established in good
faith by mutual written agreement of the parties and shall be made a part
of this Agreement as Schedule 1.3.
1.4 FACSIMILE COMMUNICATIONS.
(a) The Fund hereby authorizes and instructs the Transfer Agent, as
transfer agent for the Portfolios listed on Appendix A: (i) to accept
facsimile transaction requests on behalf of individual Shareholders
received from broker/dealers of record, third-party administrators ("TPAs")
or the Fund; (ii) that the broker/dealers, TPAs and the Fund are duly
authorized to initiate such transactions on behalf of the Shareholders; and
(iii) that the original source documentation is in good order and the
broker/dealers, TPAs or the Fund will retain such documentation.
(b) The Transfer Agent acknowledges that requests for a change in wiring
instructions or for redemptions, the proceeds of which are to be paid to
third parties or wired to an account other than the account of record, may
not be accepted by facsimile transmission in accordance with the Fund's
current prospectus. The Transfer Agent will not accept facsimile requests
for the foregoing unless and until such time as the Fund's prospectus
permits the acceptance of such instructions by facsimile.
1.5 E-MAIL COMMUNICATIONS.
(a) The Fund hereby instructs the Transfer Agent, as transfer agent for the
Portfolios listed on Appendix A, to accept instructions using e-mail
("E-mail Communications"), as further set out below. The Fund instructs the
Transfer Agent to accept such E-mail Communications to and from the Fund.
The Fund acknowledges that the Transfer Agent will not act on E-mail
Communications to it coming directly from Shareholders.
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(b) The Fund acknowledges that the Transfer Agent is not extending any
warranties or making any representations with respect to the services of
any internet services provider. Any delays or errors attributable to the
non-functioning of the internet is at the risk of the Fund. The Fund has
been advised by the Transfer Agent that E-mail Communications to or from
the Transfer Agent may not be encrypted.
(c) The Fund, when submitting instructions via e-mail, will be responsible
for determining that any original source documentation supporting such
instructions is in good order and for retaining such original
documentation.
2. INTENTIONALLY OMITTED
3. FEES AND EXPENSES
3.1 FEE SCHEDULE. For the performance by the Transfer Agent pursuant to this
Agreement, the Fund agrees to pay the Transfer Agent an annual maintenance
fee for each Shareholder account as set forth in the attached fee schedule
("Schedule 3.1"). Such fees and out-of-pocket expenses and advances
identified under SECTION 3.2 below may be changed from time to time subject
to mutual written agreement between the Fund and the Transfer Agent.
3.2 OUT-OF-POCKET EXPENSES. In addition to the fee paid under SECTION 3.1
above, the Fund agrees to reimburse the Transfer Agent for out-of-pocket
expenses in accordance with the terms of Schedule 3.1 attached hereto.
3.3 POSTAGE. Postage for mailing of dividends, proxies, Fund reports and other
mailings to all shareholder accounts shall be advanced to the Transfer
Agent by the Fund at least seven (7) days prior to the mailing date of such
materials.
3.4 INVOICES. The Fund agrees to pay all fees and reimbursable expenses within
thirty (30) days following the receipt of the respective billing notice,
except for any fees or expenses that are subject to good faith dispute. In
the event of such a dispute, the Fund may only withhold that portion of the
fee or expense subject to the good faith dispute. The Fund shall notify the
Transfer Agent in writing within twenty-one (21) calendar days following
the receipt of each billing notice if the Fund is disputing any amounts in
good faith. If the Fund does not provide such notice of dispute within the
required time, the billing notice will be deemed accepted by the Fund. The
Fund shall settle such disputed amounts within five (5) days of the day on
which the parties agree on the amount to be paid by payment of the agreed
amount. If no agreement is reached, then such disputed amounts shall be
settled as may be required by law or legal process.
3.5 COST OF LIVING ADJUSTMENT. Unless otherwise agreed to at the time of
renewal, commencing in the initial year of the first Renewal Term (if any),
the total fee for all services for that year and for each successive year
of that or any subsequent Renewal Term shall equal the fee that would be
charged for the same services based on a fee rate (as reflected in a fee
rate schedule) increased by the percentage increase for the twelve-
6
month period of such previous calendar year of the CPI-W (defined below),
or, in the event that publication of such Index is terminated, any
successor or substitute index, appropriately adjusted, acceptable to both
parties. As used herein, "CPI-W" shall mean the Consumer Price Index for
Urban Wage Earners and Clerical Workers for Boston-Brockton-Nashua,
MA-NH-ME-CT, (Base Period: 1982-84 = 100), as published by the United
States Department of Labor, Bureau of Labor Statistics.
4. REPRESENTATIONS AND WARRANTIES OF THE TRANSFER AGENT
The Transfer Agent represents and warrants to the Fund that:
4.1 It is a corporation duly organized and existing and in good standing under
the laws of The Commonwealth of
Massachusetts.
4.2 It is duly qualified to carry on its business in The Commonwealth of
Massachusetts.
4.3 It is empowered under applicable laws and by its Articles of Organization
and By-Laws to enter into and perform this Agreement.
4.4 All requisite corporate proceedings have been taken to authorize it to
enter into and perform this Agreement.
4.5 It has and will continue to have access to the necessary facilities,
equipment and personnel to perform its duties and obligations under this
Agreement.
5. REPRESENTATIONS AND WARRANTIES OF THE FUND
The Fund represents and warrants to the Transfer Agent that:
5.1 It is a trust duly organized and existing and in good standing under the
laws of the state of its organization as set forth on APPENDIX A.
5.2 It is empowered under applicable laws and by its Agreement and Declaration
of Trust and By-Laws to enter into and perform this Agreement.
5.3 All corporate proceedings required by said Agreement and Declaration of
Trust and By-Laws have been taken to authorize it to enter into and perform
this Agreement.
5.4 The Fund and each of its Portfolios is an open-end management investment
company registered under the Investment Company Act of 1940, as amended.
5.5 A registration statement under the Securities Act of 1933, as amended, is
currently effective and will remain effective, and appropriate state
securities law filings have been made and will continue to be made, with
respect to all Shares being offered for sale.
6. WIRE TRANSFER OPERATING GUIDELINES/ARTICLES 4A OF THE UNIFORM COMMERCIAL
CODE
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6.1 OBLIGATION OF SENDER. The Transfer Agent is authorized to promptly debit
the appropriate Fund account(s) upon the receipt of a payment order in
compliance with the selected security procedure (the "Security Procedure")
chosen for funds transfer and in the amount of money that the Transfer
Agent has been instructed to transfer. The Transfer Agent shall execute
payment orders in compliance with the Security Procedure and with the Fund
instructions on the execution date provided that such payment order is
received by the customary deadline for processing such a request, unless
the payment order specifies a later time. All payment orders and
communications received after the customary deadline will be deemed to have
been received the next business day.
6.2 SECURITY PROCEDURE. The Fund acknowledges that the Security Procedure it
has designated on the Fund Selection Form was selected by the Fund from
security procedures offered by the Transfer Agent. The Fund shall restrict
access to confidential information relating to the Security Procedure to
authorized persons as communicated to the Transfer Agent in writing. The
Fund must notify the Transfer Agent immediately if it has reason to believe
unauthorized persons may have obtained access to such information or of any
change in the Fund's authorized personnel. The Transfer Agent shall verify
the authenticity of all Fund instructions according to the Security
Procedure.
6.3 ACCOUNT NUMBERS. The Transfer Agent shall process all payment orders on the
basis of the account number contained in the payment order. In the event of
a discrepancy between any name indicated on the payment order and the
account number, the Transfer Agent shall use commercially reasonable
efforts to resolve the discrepancy. For all discrepancies that remain
unresolved after the use of commercially reasonable efforts, the account
number shall take precedence and govern.
6.4 REJECTION. The Transfer Agent reserves the right to decline to process or
delay the processing of a payment order which (a) is in excess of the
collected balance in the account to be charged at the time of the Transfer
Agent's receipt of such payment order; (b) if initiating such payment order
would cause the Transfer Agent, in the Transfer Agent's sole judgement, to
exceed any volume, aggregate dollar, network, time, credit or similar
limits which are applicable to the Transfer Agent; or (c) if the Transfer
Agent, in good faith, is unable to satisfy itself that the transaction has
been properly authorized.
6.5 CANCELLATION AMENDMENT. The Transfer Agent shall use reasonable best
efforts to act on all authorized requests to cancel or amend payment orders
received in compliance with the Security Procedure provided that such
requests are received in a timely manner affording the Transfer Agent
reasonable opportunity to act. However, the Transfer Agent assumes no
liability if the request for amendment or cancellation cannot be satisfied.
6.6 ERRORS. The Transfer Agent shall assume no responsibility for failure to
detect any erroneous payment order provided that the Transfer Agent
complies with the payment order instructions as received and the Transfer
Agent complies with the Security Procedure. The Security Procedure is
established for the purpose of authenticating payment orders only and not
for the detection of errors in payment orders.
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6.7 INTEREST. The Transfer Agent shall assume no responsibility for lost
interest with respect to the refundable amount of any unauthorized payment
order, unless the Transfer Agent is notified of the unauthorized payment
order within thirty (30) days of notification by the Transfer Agent of the
acceptance of such payment order.
6.8 ACH CREDIT ENTRIES/PROVISIONAL PAYMENTS. When the Fund initiates or
receives Automated Clearing House credit and debit entries pursuant to
these SECTION 6 guidelines and the rules of the National Automated Clearing
House Association and the New England Clearing House Association, State
Street Bank and Trust Company will act as an Originating Depository
Financial Institution and/or Receiving Depository Financial Institution, as
the case may be, with respect to such entries. Credits given by the
Transfer Agent with respect to an ACH credit entry are provisional until
the Transfer Agent receives final settlement for such entry from the
Federal Reserve Bank. If the Transfer Agent does not receive such final
settlement, the Fund agrees that the Transfer Agent shall receive a refund
of the amount credited to the Fund in connection with such entry, and the
party making payment to the Fund via such entry shall not be deemed to have
paid the amount of the entry.
6.9 CONFIRMATION. Confirmation of Transfer Agent's execution of payment orders
shall ordinarily be provided within twenty four (24) hours notice of which
may be delivered through the Transfer Agent's proprietary information
systems, or by facsimile or call-back. Fund must report any objections to
the execution of an order within thirty (30) days.
7. DATA ACCESS AND PROPRIETARY INFORMATION
7.1 The Fund acknowledges that the databases, computer programs, screen
formats, report formats, interactive design techniques, and documentation
manuals furnished to the Fund by the Transfer Agent as part of the Fund's
ability to access certain Fund-related data maintained by the Transfer
Agent on databases under the control and ownership of the Transfer Agent or
other third party ("Data Access Services") constitute copyrighted, trade
secret, or other proprietary information (collectively, "Proprietary
Information") of substantial value to the Transfer Agent or other third
party. In no event shall Proprietary Information be deemed to include
Customer Data (as defined in SECTION 10.1 below) which shall remain
proprietary to the Fund. The Fund agrees to treat all Proprietary
Information as proprietary to the Transfer Agent and further agrees that it
shall not divulge any Proprietary Information to any person or organization
except as may be provided hereunder. Without limiting the foregoing, the
Fund agrees for itself and its employees and agents to:
(a) Use such programs and databases (i) solely on the Fund's computers or
those of the Fund's investment adviser, administrator or distributor, or
(ii) solely from equipment at the location agreed to between the Fund and
the Transfer Agent and (iii) solely in accordance with the Transfer Agent's
applicable user documentation;
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(b) Refrain from copying or duplicating in any way (other than in the
normal course of performing processing on the Fund's computer(s) or those
of the Fund's investment adviser, administrator or distributor), the
Proprietary Information;
(c) Refrain from obtaining unauthorized access to any portion of the
Proprietary Information, and if such access is inadvertently obtained, to
inform in a timely manner of such fact and dispose of such information in
accordance with the Transfer Agent's instructions;
(d) Refrain from causing or allowing information transmitted from the
Transfer Agent's computer to the Fund's terminal or that of the Fund's
investment adviser, administrator or distributor to be retransmitted to any
other computer terminal or other device except as expressly permitted by
the Transfer Agent (such permission not to be unreasonably withheld); and
(e) Honor all reasonable written requests made by the Transfer Agent to
protect at the Transfer Agent's expense the rights of the Transfer Agent in
Proprietary Information at common law, under federal copyright law and
under other federal or state law.
Notwithstanding the foregoing, the Transfer Agent acknowledges that the
Fund may share the Proprietary Information of the Transfer Agent with the
Fund's investment adviser, administrator or distributor or any of their
affiliates; provided that such parties are subject to obligations of
confidentiality to the Fund with regard to such Proprietary Information of
the Transfer Agent no less stringent than those set forth in this Agreement
7.2 Proprietary Information shall not include all or any portion of any of the
foregoing items that: (i) are or become publicly available without breach
of this Agreement; (ii) are released for general disclosure by a written
release by the Transfer Agent; or (iii) are already in the possession of
the receiving party at the time of receipt without obligation of
confidentiality or breach of this Agreement.
7.3 The Fund acknowledges that its obligation to protect the Transfer Agent's
Proprietary Information is essential to the business interest of the
Transfer Agent and that the disclosure of such Proprietary Information in
breach of this Agreement would cause the Transfer Agent immediate,
substantial and irreparable harm, the value of which would be extremely
difficult to determine. Accordingly, the parties agree that, in addition to
any other remedies that may be available in law, equity, or otherwise for
the disclosure or use of the Proprietary Information in breach of this
Agreement, the Transfer Agent shall be entitled to seek and obtain a
temporary restraining order, injunctive relief, or other equitable relief
against the continuance of such breach.
7.4 If the Fund notifies the Transfer Agent that any of the Data Access
Services do not operate in material compliance with the most recently
issued user documentation for such services, the Transfer Agent shall
endeavor in a timely manner to correct such failure. Organizations from
which the Transfer Agent may obtain certain data included in the Data
Access Services are solely responsible for the contents of such data and
the Fund agrees to make no claim against the Transfer Agent arising out of
the contents of such
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third-party data, including, but not limited to, the accuracy thereof. DATA
ACCESS SERVICES AND ALL COMPUTER PROGRAMS AND SOFTWARE SPECIFICATIONS USED
IN CONNECTION THEREWITH ARE PROVIDED ON AN AS IS, AS AVAILABLE BASIS. THE
TRANSFER AGENT EXPRESSLY DISCLAIMS ALL WARRANTIES EXCEPT THOSE EXPRESSLY
STATED HEREIN INCLUDING, BUT NOT LIMITED TO, THE IMPLIED WARRANTIES OF
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.
7.5 If the transactions available to the Fund include the ability to originate
electronic instructions to the Transfer Agent in order to (i) effect the
transfer or movement of cash or Shares or (ii) transmit Shareholder
information or other information, then in such event the Transfer Agent
shall be entitled to rely on the validity and authenticity of such
instruction without undertaking any further inquiry as long as such
instruction is undertaken in conformity with security procedures
established by the Transfer Agent from time to time and agreed to by the
Fund.
7.6 Each party shall take reasonable efforts to advise its employees of their
obligations pursuant to this SECTION 7. The obligations of this Section
shall survive any earlier termination of this Agreement.
8. INDEMNIFICATION
8.1 The Transfer Agent shall not be responsible for, and the Fund shall
indemnify and hold the Transfer Agent harmless, and with respect to SECTION
8.1(f) herein, also State Street Bank and Trust Company ("State Street"),
from and against, any and all losses, damages, costs, charges, reasonable
counsel fees (including the defense of any law suit in which the Transfer
Agent or affiliate is a named party), payments, expenses and liability
arising out of or attributable to:
(a) All actions of the Transfer Agent or its agents or subcontractors
required to be taken pursuant to this Agreement, provided that such actions
are taken in good faith and without negligence or willful misconduct;
(b) The Fund's lack of good faith, negligence or willful misconduct;
(c) The reliance upon, and any subsequent use of or action taken or
omitted, by the Transfer Agent, or its agents or subcontractors on: (i) any
information, records, documents, data, stock certificates or services,
which are received by the Transfer Agent or its agents or subcontractors by
machine readable input, facsimile, CRT data entry, electronic instructions
or other similar means authorized by the Fund, and which have been
prepared, maintained or performed by the Fund or any other person or firm
on behalf of the Fund including but not limited to any broker-dealer, TPA
or previous transfer agent; (ii) any instructions or requests of the Fund
or any of its officers; (iii) any instructions or opinions of legal counsel
with respect to any matter arising in connection with the services to be
performed by the Transfer Agent under this Agreement which are provided to
the Transfer Agent after consultation with such legal counsel; or (iv) any
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paper or document, reasonably believed to be genuine, authentic, or signed
by the proper person or persons;
(d) The offer or sale of Shares in violation of federal or state securities
laws or regulations requiring that such Shares be registered or in
violation of any stop order or other determination or ruling by any federal
or any state agency with respect to the offer or sale of such Shares;
(e) The acceptance of facsimile transaction requests on behalf of
individual Shareholders received from broker-dealers, TPAs or the Fund, and
the reliance by the Transfer Agent on the broker-dealer, TPA or the Fund
ensuring that the original source documentation is in good order and
properly retained;
(f) The negotiation and processing of any checks, wires or ACH
transmissions (including in connection with payroll or MSA transmissions)
including without limitation for deposit into, or credit to, the Fund's
demand deposit account maintained by the Transfer Agent;
(g) Upon the Fund's request entering into any agreements required by the
NSCC for the transmission of Fund or Shareholder data through the NSCC
clearing systems; or
(h) The breach of any representation or warranty set forth in SECTION 5
above.
8.2 To the extent the Transfer Agent is not entitled to indemnification
pursuant to SECTION 8.1 above, the Fund shall not be responsible for, and
the Transfer Agent shall indemnify and hold the Fund, its Board of
Trustees, officers, employees and agents, harmless from and against any
losses, damages, costs, charges, reasonable counsel fees, payments,
expenses and liability arising directly out of or attributable to any
action or failure of the Transfer Agent to act as a result of the
Transfer's Agent's lack of good faith, negligence or willful misconduct in
the performance of its services hereunder or the breach of any
representation or warranty set forth in SECTION 4 above.
8.3 In order that the indemnification provisions contained in this SECTION 8
shall apply, upon the assertion of an indemnification claim, the party
seeking the indemnification shall promptly notify the other party of such
assertion, and shall keep the other party advised with respect to all
developments concerning such claim. The Fund shall have the option to
participate with the Transfer Agent in the defense of such claim or to
defend against said claim in its own name or that of the Transfer Agent.
The party seeking indemnification shall in no case confess any claim or
make any compromise in any case in which the other party may be required to
indemnify it except with the indemnifying party's written consent, which
consent shall not be unreasonably withheld.
12
9. STANDARD OF CARE/LIMITATION OF LIABILITY
The Transfer Agent shall at all times act in good faith and agrees to use
its best efforts within reasonable limits to ensure the accuracy of all
services performed under this Agreement, but assumes no responsibility and
shall not be liable for loss or damage due to errors, including encoding
and payment processing errors, unless said errors are caused by its
negligence, bad faith, or willful misconduct or that of its employees or
agents. The parties agree that any encoding or payment processing errors
shall be governed by this standard of care and Section 4-209 of the Uniform
Commercial Code is superseded by SECTION 9 of this Agreement. This standard
of care also shall apply to Exception Services, as defined in SECTION 2.3
herein, but such application shall take into consideration the manual
processing involved in, and time sensitive nature of, Exception Services.
Notwithstanding the foregoing, the Transfer Agent's aggregate liability
during any term of this Agreement, whether in contract, or in tort, or
otherwise shall be as determined and as set forth on Schedule 9 to this
Agreement.
10. CONFIDENTIALITY
10.1 (a) The Transfer Agent and the Fund agree that they will not, at any time
during the term of this Agreement or after its termination, reveal,
divulge, or make known to any person, firm, corporation or other business
organization, any customers' lists, trade secrets, cost figures and
projections, profit figures and projections, or any other secret or
confidential information whatsoever, whether of the Transfer Agent or of
the Fund, used or gained by the Transfer Agent or the Fund during
performance under this Agreement (such party's "Confidential Information").
The Fund and the Transfer Agent further covenant and agree to retain all
such Confidential Information of the other party whatsoever in trust for
the sole benefit of the Transfer Agent or the Fund and their successors and
assigns. In the event of breach of the foregoing by either party, the
remedies provided by SECTION 7.3 shall be available to the party whose
confidential information is disclosed. The Transfer Agent acknowledges that
the Fund may share the Confidential Information of the Transfer Agent with
the Fund's investment adviser, administrator and distributor and any of
their affiliates, agents, legal counsel and consultants provided that such
parties are subject to obligations of confidentiality to the Fund with
regard to such Confidential Information of the Transfer Agent no less
stringent than those set forth in this Agreement.
(b) The Transfer Agent represents, covenants, and warrants that Transfer
Agent will use the nonpublic personal information of the Fund's
Shareholders ("Customer Data") only in compliance with (i) this Agreement,
(ii) its own Privacy and Information Sharing Policy, as amended from time
to time, (iii) the Xxxxx-Xxxxx-Xxxxxx Act (the "GLB Act") and Regulation
S-P promulgated thereunder to the extent each is specifically applicable to
its transfer agency business, and (iv) as directed by authorized persons of
the Fund in writing and will not, except as set forth above, at any time
during the term of this Agreement or after its termination, reveal, divulge
or make known to any person, firm or other business organization any
Customer Data as obtained by the Transfer Agent in performance of its
services pursuant to this Agreement.
13
10.2 In the event that any requests or demands are made for the inspection of
the Shareholder records of the Fund, other than request for records of
Shareholders pursuant to standard subpoenas from state or federal
government authorities (i.e., divorce and criminal actions), the Transfer
Agent will use best efforts to notify the Fund and to secure instructions
from an authorized officer of the Fund as to such inspection. The Transfer
Agent expressly reserves the right, however, to exhibit the Shareholder
records to any person whenever it is advised by counsel that it may be held
liable for the failure to exhibit the Shareholder records to such person or
if required by law or court order.
11. COVENANTS OF THE FUND AND THE TRANSFER AGENT
11.1 The Fund shall promptly furnish to the Transfer Agent the following:
(a) A certified copy of the resolution of the Board of Trustees of the Fund
authorizing the appointment of the Transfer Agent and the execution and
delivery of this Agreement; and
(b) A copy of the Agreement and Declaration of Trust and By-Laws of the
Fund and all amendments thereto.
11.2 The Transfer Agent hereby agrees to establish and maintain facilities and
procedures reasonably acceptable to the Fund for safekeeping of stock
certificates, check forms and facsimile signature imprinting devices, if
any; and for the preparation or use, and for keeping account of, such
certificates, forms and devices.
11.3 The Transfer Agent shall keep records relating to the services to be
performed hereunder, in the form and manner as it may deem advisable. To
the extent required by Section 31 of the Investment Company Act of 1940, as
amended, and the rules thereunder, the Transfer Agent agrees that all such
records prepared or maintained by the Transfer Agent relating to the
services to be performed by the Transfer Agent hereunder are the property
of the Fund and will be preserved, maintained and made available in
accordance with such Section and rules thereunder, and will be surrendered
promptly to the Fund on and in accordance with its request.
11.4 The Transfer Agent shall maintain a fidelity bond covering larceny and
embezzlement and an insurance policy with respect to directors' and
officers' errors and omissions coverage in amounts that are appropriate in
light of its duties and responsibilities hereunder. Upon the request of the
Fund, the Transfer Agent shall provide evidence that coverage is in place.
The Transfer Agent shall notify the Fund should its insurance coverage with
respect to professional liability or errors and omissions be canceled. Such
notification shall include the date of cancellation and the reasons
therefore. The Transfer Agent shall notify the Fund of any material claims
against it with respect to the services provided under this Agreement to
the Fund, whether or not they may be covered by insurance, and shall notify
the Fund should the total outstanding claims made by the Transfer Agent
under its insurance coverage materially impair, or threaten to materially
impair, the adequacy of its coverage.
14
12. TERMINATION OF AGREEMENT
12.1 TERM. The initial term of this Agreement (the "Initial Term") shall be
three (3) years from the date first stated above unless terminated pursuant
to the provisions of this SECTION 12. Unless a terminating party gives
written notice to the other party at least one hundred and twenty (120)
days before the expiration of the Initial Term or any Renewal Term (as
defined herein), this Agreement will renew automatically for an additional
one-year term and, thereafter, for successive one-year terms (each such
year-to-year renewal term, a "Renewal Term"). Notwithstanding the
foregoing, during a Renewal Term, this Agreement may be terminated by
either party upon at least one hundred and twenty (120) days' written
notice to the other party. The notification requirements herein shall not
apply to a termination for cause, which shall be governed by the provisions
of SECTION 12.6 below. One hundred and twenty (120) days before the
expiration of the Initial Term or a Renewal Term the parties to this
Agreement will agree upon a Fee Schedule for the upcoming Renewal Term.
Otherwise, the fees shall be increased pursuant to SECTION 3.5 of this
Agreement.
12.2 EARLY TERMINATION. Notwithstanding anything contained in this Agreement to
the contrary, should the Fund desire to move any of its services provided
by the Transfer Agent hereunder to a successor service provider prior to
the expiration of the then-current Initial or Renewal Term, or without the
required notice, the Transfer Agent shall make a good faith effort to
facilitate the conversion on such prior date; however, there can be no
guarantee or assurance that the Transfer Agent will be able to facilitate a
conversion of services on such prior date. In connection with the
foregoing, if during the Initial Term, the Fund should convert all or
substantially all of such services to a successor service provider, or if
the Fund or substantially all of its Portfolios are liquidated or all or
substantially all of its assets are merged or purchased or the like with or
by another entity which does not utilize the services of the Transfer
Agent, its affiliates or the TA2000 platform as set forth below, the fees
payable to the Transfer Agent shall be calculated as if the services had
been performed by the Transfer Agent until the expiration of the Initial
Term and calculated at the asset and/or Shareholder account levels, as the
case may be, on the date notice of termination was given to the Transfer
Agent, and the payment of all fees to the Transfer Agent as set forth
herein shall be accelerated to the business day immediately prior to the
conversion or termination of services (the "Early Termination Fee"). In the
event that (i) the Fund terminates this Agreement as the result of its
acquisition by or merger into another fund and such other fund's
shareholder records are, at the time of such acquisition or merger,
maintained by the Transfer Agent or its affiliates, or (ii) the Fund wishes
to move its transfer agency servicing operation from the Transfer Agent to
an affiliated entity or another DST TA2000 platform (i.e., become a remote
user of DST's TA2000 system) as the result of Fund's acquisition by or
merger into another fund, then the parties agree to negotiate in good faith
to determine whether or to what extent the Early Termination Fee shall
apply to such termination.
12.3 TERMINATION EXPENSES AND COSTS. During the Initial Term or Renewal Term,
whichever currently is in effect, should either party exercise its right to
terminate, all out-of-pocket expenses or costs associated with the movement
of records and material will be borne by
15
the Fund. Additionally, the Transfer Agent reserves the right to charge for
any other reasonable expenses associated with such termination.
12.4 CONFIDENTIAL INFORMATION. Upon termination of this Agreement, each party
shall return to the other party all copies of confidential or proprietary
materials or information received from such other party hereunder, other
than materials or information required to be retained by such party under
applicable laws or regulations. Each party hereby agrees to dispose of any
"consumer report information," as such term is defined under Regulation S-P
promulgated under the GLB Act, in accordance with the provisions of
Regulation S-P and the GLB Act applicable to its respective business.
12.5 UNPAID INVOICES. Except with respect to any amount subject to a good faith
dispute within the meaning of SECTION 3.4 of this Agreement, the Transfer
Agent may terminate this Agreement in the event that an invoice payable by
the Fund to the Transfer Agent remains outstanding for more than ninety
(90) days; provided that the Transfer Agent has provided written notice to
the Fund at least thirty (30) days prior to such termination (which notice
may be provided prior to the expiration of the ninety (90) day period).
12.6 TERMINATION BY EITHER PARTY FOR CAUSE. In the event that: (i) the Transfer
Agent defaults in the performance of its obligations under Schedule 1.3
"Service Level Agreement" in accordance with the terms of such schedule
and, as a result thereof, the Fund is entitled to exercise a Service Level
Termination Right as defined in such schedule or (ii) either party fails
perform its duties hereunder (including any material interruption or
cessation of its operations), which failure materially adversely affects
the business operations of the other party and which failure continues for
thirty (30) days after receipt of written notice from the first party,
unless such failure is excused under the terms of Schedule 1.3 or SECTION
15.3 (Force Majeure) of this Agreement, such non-defaulting party may
terminate this Agreement by giving written notice to the other party as of
the termination date specified in the notice of termination. The Transfer
Agent shall make a good faith effort to facilitate conversion as described
in SECTION 12.2 above. In the event of a termination by the Fund for cause,
the Fund shall not be obligated to pay the Early Termination Fee as defined
in SECTION 12.2 above.
13. ASSIGNMENT AND THIRD PARTY BENEFICIARIES
13.1 Except as provided in Section 14.1 below neither this Agreement nor any
rights or obligations hereunder may be assigned by either party without the
written consent of the other party. Any attempt to do so in violation of
this Section shall be void. Unless specifically stated to the contrary in
any written consent to an assignment, no assignment will release or
discharge the assignor from any duty or responsibility under this
Agreement. For the avoidance of doubt, a transaction involving a merger or
sale of substantially all of the assets of a Portfolio or a Fund shall not
require the written consent of the Transfer Agent.
13.2 Except as explicitly stated elsewhere in this Agreement, nothing under this
Agreement shall be construed to give any rights or benefits in this
Agreement to anyone other than the Transfer Agent and the Fund, and the
duties and responsibilities undertaken pursuant
16
to this Agreement shall be for the sole and exclusive benefit of the
Transfer Agent and the Fund. This Agreement shall inure to the benefit of
and be binding upon the parties and their respective permitted successors
and assigns.
13.3 This Agreement does not constitute an agreement for a partnership or joint
venture between the Transfer Agent and the Fund. Other than as provided in
Section 14.1 and Schedule 1.2(f), neither party shall make any commitments
with third parties that are binding on the other party without the other
party's prior written consent.
14. SUBCONTRACTORS
14.1 The Transfer Agent may, without further consent on the part of the Fund,
subcontract for the performance hereof with an affiliate of the Transfer
Agent duly registered as a transfer agent or, with regard to print/mail
services, with another affiliate or provider; provided, however, that
consent of the Fund shall be required with regard to print/mail services
which the Fund currently maintains by a separate agreement. The Transfer
Agent shall be fully responsible to the Fund for the acts and omissions of
its affiliate as it is for its own acts and omissions. With regard to
print/mail services that are provided by a vendor not affiliated with the
Transfer Agent, the Transfer Agent will use all reasonable commercial
efforts to coordinate with such outside print/mail vendor and to timely and
accurately provide all information requested by such print/mail vendor;
provided, however, that the Transfer Agent shall not be held liable to the
Fund or any affiliated party of the Fund for any act or failure to act by
such outside print/mail vendor except where the Transfer Agent's negligent
acts or omissions were the proximate cause of such vendor's
non-performance.
14.2 Nothing herein shall impose any duty upon the Transfer Agent in connection
with or make the Transfer Agent liable for the actions or omissions to act
of unaffiliated third parties such as by way of example and not limitation,
Airborne Services, Federal Express, United Parcel Service, the U.S. Mails,
the NSCC and telecommunication companies, provided that, if the Transfer
Agent selected such company, the Transfer Agent shall have exercised due
care in selecting the same.
15. MISCELLANEOUS
15.1 AMENDMENT. This Agreement may be amended or modified only by a written
agreement executed by both parties.
15.2
MASSACHUSETTS LAW TO APPLY. This Agreement shall be construed and the
provisions thereof interpreted under and in accordance with the laws of The
Commonwealth of
Massachusetts.
15.3 FORCE MAJEURE. In the event either party is unable to perform its
obligations under the terms of this Agreement because of acts of God, acts
of war or terrorism, strikes, equipment or transmission failure or damage
reasonably beyond its control, or other causes reasonably beyond its
control, such party shall not be liable for damages to the other for any
damages resulting from such failure to perform or otherwise from such
17
causes; provided, however, that this provision shall not imply that the
Transfer Agent is excused from maintaining reasonable business continuity
plans to address potential service outages.
15.4 CONSEQUENTIAL DAMAGES. Neither party to this Agreement shall be liable to
the other party for special, indirect or consequential damages under any
provision of this Agreement or for any special, indirect or consequential
damages arising out of any act or failure to act hereunder.
15.5 SURVIVAL. All provisions regarding indemnification, warranty, liability,
and limits thereon, and confidentiality and/or protections of proprietary
rights and trade secrets shall survive the termination of this Agreement.
15.6 SEVERABILITY. If any provision or provisions of this Agreement shall be
held invalid, unlawful, or unenforceable, the validity, legality, and
enforceability of the remaining provisions shall not in any way be affected
or impaired.
15.7 THE PARTIES. All references herein to the "Fund" are to each of the
management investment companies listed on Appendix A hereto, and each
management company made subject to this Agreement in accordance with
SECTION 16 below, individually, as if the Agreement were between each such
Fund and the Transfer Agent. In the case of a series trust, all references
to "Portfolio" are to the individual series or portfolio of such trust or
to such trust on behalf of the individual series or portfolio, as
appropriate.
15.8 PRIORITIES CLAUSE. In the event of any conflict, discrepancy or ambiguity
between the terms and conditions contained in this Agreement and any
Schedules or attachments hereto, the terms and conditions contained in this
Agreement shall take precedence.
15.9 WAIVER. No waiver by either party or any breach or default of any of the
covenants or conditions herein contained and performed by the other party
shall be construed as a waiver of any succeeding breach of the same or of
any other covenant or condition.
15.10 MERGER OF AGREEMENT. This Agreement constitutes the entire agreement
between the parties hereto and supersedes any prior agreement with respect
to the subject matter hereof whether oral or written.
15.11 COUNTERPARTS. This Agreement may be executed by the parties hereto in any
number of counterparts, and all of said counterparts taken together shall
be deemed to constitute one and the same instrument.
15.12 REPRODUCTION OF DOCUMENTS. This Agreement and all schedules, exhibits,
attachments and amendments hereto may be reproduced by any photographic,
photostatic, microfilm, micro-card, miniature photographic or other similar
process. The parties hereto each agree that any such reproduction shall be
admissible in evidence as the original itself in any judicial or
administrative proceeding, whether or not the original is in existence and
whether or not such reproduction was made by a party in the regular course
of business,
18
and that any enlargement, facsimile or further reproduction shall likewise
be admissible in evidence.
15.13 NOTICES. All notices and other communications as required or permitted
hereunder shall be in writing and sent by first class mail, postage
prepaid, addressed as follows or to such other address or addresses of
which the respective party shall have notified the other.
(a) If to Boston Financial Data Services, Inc., to:
Boston Financial Data Services, Inc.
0 Xxxxxxxx Xxxxx, 0xx Xxxxx
Xxxxx Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Legal Department
Facsimile: (000) 000-0000
(b) If to an entity set forth on Appendix A hereto, to:
Xxxxxxxxxxx Xxxxxx
Director of Mutual Fund Operations
0 Xxxxx XxXxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, XX 00000
Facsimile: (000) 000-0000
16. ADDITIONAL FUNDS/PORTFOLIOS
In the event that the Fund establishes one or more series of Shares, in
addition to those listed on the attached Appendix A, with respect to which
it desires to have the Transfer Agent render services as transfer agent
under the terms hereof, it shall so notify the Transfer Agent in writing,
and if the Transfer Agent agrees in writing to provide such services, such
series of Shares shall become a Portfolio hereunder. Furthermore, in the
event that one or more additional funds affiliated with the Fund desire(s)
to have the Transfer Agent render services as transfer agent under the
terms hereof, such fund or funds shall so notify the Transfer Agent in
writing, and if the Transfer Agent agrees in writing to provide such
services, such fund or funds, together with their portfolios, may become
parties to this Agreement by execution of a counterpart signature page
hereto.
In the event that new affiliated funds and their portfolios become parties
to this Agreement, the fees and expenses set forth on Schedule 3.1 shall
apply to such funds and portfolios for their applicable initial term or
renewal term, provided that the requirements of such funds and portfolios
are generally consistent with the services then being provided by the
Transfer Agent under this Agreement to the Fund and its Portfolios.
Notwithstanding the foregoing, however, at such time as the number of
CUSIPs serviced by the Transfer Agent for all Xxxxxx Associates funds and
their affiliated funds has increased by forty percent (40%) or more from
the number of CUSIPs serviced by the Transfer Agent on the first date of
this Agreement (as to all Xxxxxx Associates funds and their affiliates
together) the parties agree to review and, if necessary, negotiate the fees
19
and expenses set forth on Schedule 3.1 for the Fund and its Portfolios and
any new affiliated funds and their portfolios in light of the additional
administrative, technical and other service costs imposed on the Transfer
Agent by such additional services.
17. LIMITATIONS OF LIABILITY OF THE TRUSTEES AND SHAREHOLDERS
A copy of the Agreement and Declaration of Trust of each Fund listed on
Appendix A is on file with the Secretary of the Commonwealth of
Massachusetts, and notice is hereby given that this instrument is executed
by an officer of the Trust on behalf of the Trustees of the Trust as
Trustees and not individually and that the obligations of this instrument
are not binding upon any of the Trustees, officers or Shareholders
individually but are binding only upon the assets and property of the Fund.
[THE REMAINDER OF THE PAGE IS INTENTIONALLY LEFT BLANK]
20
IN WITNESS WHEREOF, the parties hereto have caused this Agreement 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.
XXXXXX ASSOCIATES INVESTMENT TRUST
By: /s/ Xxxx X. Xxxxx
---------------------------------
Name: Xxxx X. Xxxxx
---------------------------------
Title: President
---------------------------------
As an Authorized Officer on behalf of
the Fund listed above.
ATTEST:
/s/ Xxxxx X. Xxxxx
-----------------------------------
BOSTON FINANCIAL DATA SERVICES, INC.
By: /s/ Xxxxxxx Xxx
---------------------------------
Name: Xxxxxxx Xxx
---------------------------------
Title: Senior Vice President
---------------------------------
ATTEST:
/s/ Xxxxxxxxx Xxxxx
-----------------------------------
21
APPENDIX A
FUNDS AND PORTFOLIOS
Dated: October 1, 2005
Xxxxxx Associates Investment Trust, a business trust organized under the laws of
the Commonwealth of
Massachusetts.
The Oakmark Fund
The Oakmark Select Fund
The Oakmark Equity and Income Fund
The Oakmark Global Fund
The Oakmark International Fund
The Oakmark International Small Cap Fund
XXXXXX ASSOCIATES INVESTMENT TRUST BOSTON FINANCIAL DATA SERVICES, INC.
By: /s/ Xxxx X. Xxxxx By: /s/ Xxxxxxx Xxx
---------------------------------- ----------------------------------
Name: Xxxx X. Xxxxx Name: Xxxxxxx Xxx
-------------------------------- --------------------------------
Title: President Title: Senior Vice President
------------------------------- -------------------------------
As an Authorized Officer on behalf of
the Fund listed above.
A - 1
SCHEDULE 1.2(f)
AML DELEGATION
Dated : October 1, 2005
1. DELEGATION.
1.1 Subject to the terms and conditions set forth in this Agreement, the Fund
hereby delegates to the Transfer Agent those aspects of the Fund's Program
that are set forth in Section 4 below (the "Delegated Duties"). The
Delegated Duties set forth in Section 4 may be amended, from time to time,
by mutual agreement of the Fund and the Transfer Agent upon the execution
by such parties of a revised Schedule 1.2(f) bearing a later date than the
date hereof.
1.2 The Transfer Agent agrees to perform such Delegated Duties, with respect to
the ownership of shares in the Fund for which the Transfer Agent maintains
the applicable shareholder information, subject to and in accordance with
the terms and conditions of this Agreement.
2. CONSENT TO EXAMINATION. In connection with the performance by the Transfer
Agent of the Delegated Duties, the Transfer Agent understands and
acknowledges that the Fund remains responsible for assuring compliance with
the USA PATRIOT Act and that the records the Transfer Agent maintains for
the Fund relating to the AML Program may be subject, from time to time, to
examination and/or inspection by federal regulators in order that the
regulators may evaluate such compliance. The Transfer Agent hereby consents
to such examination and/or inspection and agrees to cooperate with such
federal examiners in connection with their review. For purposes of such
examination and/or inspection, the Transfer Agent will use its best efforts
to make available, during normal business hours and on reasonable notice
all required records and information for review by such examiners.
3. LIMITATION ON DELEGATION. The Fund acknowledges and agrees that in
accepting the delegation hereunder, the Transfer Agent is agreeing to
perform only the Delegated Duties, as may be amended from time to time, and
is not undertaking and shall not be responsible for any other aspect of the
AML Program or for the overall compliance by the Fund with the USA PATRIOT
Act or for any other matters that have not been delegated hereunder.
Additionally, the parties acknowledge and agree that the Transfer Agent
shall only be responsible for performing the Delegated Duties with respect
to the ownership of, and transactions in, shares in the Fund for which the
Transfer Agent maintains the applicable shareholder information.
4. DELEGATED DUTIES
4.1 Consistent with the services provided by the Transfer Agent and with
respect to the ownership of shares in the Fund for which the Transfer Agent
maintains the applicable shareholder information, the Transfer Agent shall:
(a) Submit all new account and registration maintenance transactions
through the Office of Foreign Assets Control ("OFAC") database and such
other lists or databases of trade
1
restricted individuals or entities as may be required from time to time by
applicable regulatory authorities;
(b) Submit special payee checks through OFAC database;
(c) Review redemption transactions that occur within thirty (30) days of
account establishment or maintenance;
(d) Review wires sent pursuant to instructions other than those already on
file with the Transfer Agent;
(e) Review accounts with small balances followed by large purchases;
(f) Review accounts with frequent activity within a specified date range
followed by a large redemption;
(g) On a daily basis, review purchase and redemption activity per tax
identification number ("TIN") within the Fund to determine if activity for
that TIN exceeded the $100,000 threshold on any given day;
(h) Compare all new accounts and registration maintenance through the Known
Offenders database and notify the Fund of any match.
(i) Monitor and track cash equivalents under $10,000 for a rolling
twelve-month period and file IRS Form 8300 and issue the Shareholder
notices required by the IRS;
(j) Determine when a suspicious activity report ("SAR") should be filed as
required by regulations applicable to mutual funds and prepare and file the
SAR. Provide the Fund with a copy of the SAR within a reasonable time after
filing; notify the Fund if any further communication is received from U.S.
Department of the Treasury or other law enforcement agencies regarding the
SAR;
(k) Compare account information to any FinCEN request received by the Fund
and provided to the Transfer Agent pursuant to USA PATRIOT Act Sec. 314(a).
Provide the Fund with documents/information necessary to respond to
requests under USA PATRIOT Act Sec. 314(a) within required time frames; and
(l) Pursuant to applicable regulations: (i) verify the identity of any
person seeking to open an account with the Fund; (ii) maintain records of
the information used to verify the person's identity; and (iii) determine
whether the person appears on any lists of known or suspected terrorists or
terrorist organizations provided to the Fund by any government agency.
4.2 In the event that the Transfer Agent detects activity as a result of the
foregoing procedures, which necessitates the filing by the Transfer Agent
of a SAR, a Form 8300 or other similar report or notice to OFAC, then the
Transfer Agent shall timely file such report and also immediately notify
the Fund, unless prohibited by applicable law.
2
4.3 AML Reporting
(a) On a quarterly basis, the Transfer Agent shall provide a report to the
Fund on its performance of the AML Delegated Duties, among other
compliance items, which report shall include information regarding the
number of: (i) potential incidents involving cash and cash equivalents
or unusual or suspicious activity, (ii) Forms 8300 and SARs filed on
behalf of the Fund, (iii) outstanding customer verification items,
(iv) potential and confirmed matches against the known offender and
OFAC databases and (v) potential and confirmed matches in connection
with FinCen requests. Notwithstanding anything in this Section 4.3(a)
to the contrary, the Transfer Agent reserves the right to amend and
update the form of its AML reporting from time to time to comply with
new or amended requirements of applicable law or to enhance its
Compliance+ program.
(b) At least annually, the Transfer Agent will arrange for independent
testing (an audit) of the AML services it provides to its clients on
an organization-wide basis by a qualified independent auditing firm.
The Transfer Agent will provide the AML compliance officer of the Fund
with the results of the audit and testing, including any material
deficiencies or weaknesses identified and any remedial steps that will
be taken or have been taken by the Transfer Agent to address such
material deficiencies or weaknesses.
XXXXXX ASSOCIATES INVESTMENT TRUST BOSTON FINANCIAL DATA SERVICES, INC.
By: /s/ Xxxx X. Xxxxx BY: /s/ Xxxxxxx Xxx
---------------------------------- ----------------------------------
Name: Xxxx X. Xxxxx Name: Xxxxxxx Xxx
-------------------------------- --------------------------------
Title: President Title: Senior Vice President
------------------------------- -------------------------------
As an Authorized Officer on behalf of
the Fund listed above.
3
SCHEDULE 1.3
SERVICE LEVEL AGREEMENT
Dated: October 1, 2005
OVERVIEW
The standards below represent the levels and standards which the Transfer Agent
is generally achieving in its day-to-day operations and which the Fund may
reasonably expect the Transfer Agent to generally achieve. Notwithstanding
anything in the
Transfer Agency and Service Agreement or any schedule or exhibit
thereto (the "Agreement") to the contrary, this does not mean, and, the Transfer
Agent neither represents, warrants or covenants that, nor does the Fund
necessarily expect, that the Transfer Agent shall always meet, fulfill or comply
with the levels and standards set forth below at all times. Rather, it is the
expectation of the parties that, in the event of a failure to meet, fulfill or
comply with the levels and standards set forth below, the parties shall
coordinate and cooperate to correct the inadequacies as set forth immediately
below in "Service Level Standard Resolution".
SERVICE LEVEL STANDARD RESOLUTION
Notwithstanding the Transfer Agent's best efforts to achieve the levels and
standards herein, the Fund acknowledges that such levels and standards may not
be met at all times. In the event that there is a failure to meet a service
level or standard, the Transfer Agent shall promptly notify the senior officer
designated by the Fund. Thereafter, the parties shall meet to discuss the
reason(s) that the Transfer Agent failed to meet such service level or standard
with a view to restoring compliance with such level as quickly as reasonably
possible under the circumstances to avoid a repeated failure by the Transfer
Agent. As part of the resolution process, the parties may, as agreed upon, amend
the service level or standard listed below. The parties agree that if the
Transfer Agent does not meet (i) the majority of timeliness standards or (ii)
the overall quality standard for a period of three (3) consecutive months as
measured on a monthly basis and the Transfer Agent, after receiving written
notice of such failure from the Fund, does not remedy the failure to meet such
service level or standard for forty-five (45) days following such consecutive
three (3) month period (or such longer period of time as the parties may agree
upon) then the Fund may terminate the Agreement for cause upon at least sixty
(60) days' advance written notice to the Transfer Agent (the foregoing, a
"Service Level Termination Right").
COMPLIANCE MEASUREMENT
The Transfer Agent agrees to retain, at its expense, National Quality Review
("NQR") through December 31, 2005 for the purposes of measuring compliance with
the levels and standards set forth below. The parties agree, however, that
measurement of the service levels and standards set forth herein for purposes of
the Service Level Termination Right shall not commence until January 1, 2006 in
order to provide for an orderly transition of services to the Transfer Agent.
Beginning in January 2006, the Transfer Agent will utilize its own internal
quality review process (or, any third party quality review process as the
Transfer Agent may elect from time to time to utilize, such process, "Quality
Review") to monitor the quality of services provided under the Agreement and the
Transfer Agent's satisfaction of the standards and levels set forth herein. The
Transfer Agent will measure its performance in accordance with industry
standards for (i) timeliness and accuracy of Financial and Non Financial
transactions and Call Centers and Correspondence and (ii) systems availability
through its Quality Review.
The Fund may, at any time, elect to retain, at its own expense, NQR (or, such
other industry-recognized, external quality review process as the Fund may elect
from time to time to utilize).
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In the event the Fund retains NQR or another third party quality review process,
the Transfer Agent will use all reasonable commercial efforts to assist and
cooperate with NQR (or such other industry recognized external quality review
process as the Fund may elect from time to time to utilize). In addition, the
Transfer Agent will provide to the Funds detail from the Quality Review on a
monthly basis. The Transfer Agent and the Fund agree to review the Quality
Review scores to implement process improvements going forward in the event that
improvements are necessary.
CALL CENTER AND PROCESSING STANDARDS.
MONTHLY
REPORTING
ACTIVITY STANDARDS
-------- ---------
TIMELINESS STANDARDS
CALL CENTER
Average Speed of Answer 15 seconds
Abandonment Rate 2%
Service Levels 85% within 15 seconds
CORRESPONDENCE
Financial Inquiries 3 days
Non-Financial Inquiries 6 days
XXX Acct Transfer Request Notices 3 days
XXX Acct Transfer Reminder Notices 15,30, and 45 days
TRANSACTIONS
Adjustments 98% within 2 days
Exchanges 100% date of receipt
Maintenance 98% within 3 days
New Accounts 100% date of receipt
Purchases 100% date of receipt
Redemptions 100% date of receipt
Transfers 98% within 2 days
Commission runs 3 business days
Trail commissions 5 business days
ACCURACY STANDARDS
Adjustments 95%
Exchanges 98%
Maintenances 98%
New Accounts 93%
Purchases 98%
Redemptions 97%
Transfers 97%
Overall Quality Standard 96%
SYSTEMS AVAILABILITY:
SYSTEM/ SYSTEM
APPLICATIONS HOURS OF AVAILABILITY* AVAILABILITY
*Holidays with 7 calendar days advance notice
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AS/400 99.0%
Boston Financial Monday-Friday 6:00 AM to 11:00 PM (EST)
AWD Databases Saturday 1:30 AM to 5:00 PM (EST)
Sunday 1:30 AM to 11:00 PM (EST)
TA2000 99.0%
Monday-Friday 7:00 AM to 11:00 PM (EST)
Please refer to our response below for additional information
Saturday-Sunday
Generally available, other than for scheduled
maintenance or events
AS400:
Server availability is defined as the monthly availability rate that the
Transfer Agent (through its parent DST Systems, Inc., "DST") guarantees to
maintain for servers in the AWD Data Center in regard to server hardware,
operating system, and AWD applications. The monthly availability rate does not
include any third party applications, including any custom code.
TA2000 AVAILABILITY:
TA2000 is generally available in some capacity on 24 hours a day, 7 days a week
basis. Below we have provided a description of general availability:
Service level agreements between DST and Boston Financial require that the CICS
regions be fully functional between the hours of 7:00 AM EST to the agreed upon
start of the nightly cycle, generally 10:00 PM EST on all days during which the
New York Stock Exchange is open for business; however, in actuality the system
is much more widely available than the service level agreement implies.
During the nightly cycle, certain files are sporadically unavailable for batch
updates. When the shareowner master and history files are unavailable, alternate
files are allocated to the on-lines to allow some limited lookup and transaction
functionality.
Unless there is scheduled maintenance or other activity, such as a purge or
conversion, CICS regions are fully available and functional on all non-business
days. Scheduled DST maintenance occurs routinely, generally late on a Saturday
night or early on a Sunday morning. Purge and conversion events occur over
weekends, generally early Saturday morning through mid-afternoon. When these
xxxxx occur, the system is usually unavailable. For most purge and conversion
events, it is possible to implement the alternate file process. All scheduled
maintenance and other scheduled activities are reported via change control at
least two weeks in advance of the event.
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FANWEB AND VOICE RESPONSE UNIT (VRU) AVAILABILITY
Internet websites and VRU will be available 99.5% of the time on a 7 day/24 hour
basis, excluding for regularly scheduled maintenance to the Website and VRU.
ADDITIONAL INFORMATION:
The Transfer Agent shall not be obligated to meet the foregoing levels and
standards during such periods where the Transfer Agent's failure to meet such
levels and standards arises out of, results from or is proximately caused by:
(i) a failure, inadequacy in the performance of or unavailability of
communication lines or communication facilities (including the equipment or
computer being used to access the communication lines) OUTSIDE of the Transfer
Agent's facilities; (ii) a Force Majeure event as set forth in Section 15.3 of
the Agreement, (iii) an event which requires the Transfer Agent to process at
its disaster recovery facility, (iv) a failure to perform properly or timely by
a third party whose performance is a prerequisite for the Transfer Agent's
performance, (v) a failure, unavailability, disruption or circumstances arising
out of or resulting from the Internet if any service hereunder involves or
entails utilization of the Internet to transmit to or from the Transfer Agent's
facilities, (vi) a pre-planned extraordinary event (E.G., a hardware or software
installation), and/or (vii) failures to perform caused by third parties
(including the Fund) whose actions are beyond the Transfer Agent's reasonable
control. The Transfer Agent shall have no responsibility or liability for the
unavailability of a system or service where such unavailability was caused or
contributed to by inadequacies of the Fund's equipment.
The Transfer Agent's performance during periods affected by any one or more of
the foregoing conditions shall not be measured and included in any Quality
Review report provided by the Transfer Agent to the Fund; provided, however,
that as soon as any of the foregoing circumstances is rectified or alleviated,
the measurement of the Transfer Agent's performance under the foregoing levels
and standards shall recommence.
From time to time, business environment changes may necessitate updates to the
levels and standards contained within this document. The Transfer Agent and the
Fund agree to negotiate in good faith to reach agreement on such additional
requirements.
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SCHEDULE 3.1
XXXXXX ASSOCIATES INVESTMENT TRUST
EFFECTIVE 10/1/05 TO 9/30/08
GENERAL: Fees are billable on a monthly basis at the rate of 1/12 of the annual
fee. A charge is made for an account in the month that an account opens or
closes.
ANNUAL ACCOUNT SERVICE FEES
Open Accounts*:
Networked $9.00/account
Non-Networked $15.00/account
Closed Accounts
All $2.00/account
*NOTE: Includes AML/CIP Services (excluding CIP-related search charges)
ACTIVITY BASED FEES
Marketing/Sales Calls** $1.25/minute
**NOTE: Billed to the investment adviser or distributor of the Fund.
FIDUCIARY FEES
Effective January 1, 2006, all fiduciary fees (including set-up, maintenance and
closeout) paid by Shareholders or swept from current accounts (based on current
rates and terms with each Fund) will be retained by the Transfer Agent. For fees
assessed and collected during the 2005 annual fee assessment, the Transfer Agent
will retain 25% of such fees and will remit 75% of such fees to IXIS Asset
Management Service Company (ISC) in accordance with the respective service
periods of such entities during 2005. For redemption/distribution activity
during the fourth quarter of 2005, the fiduciary fees will be retained by the
Transfer Agent.
The parties acknowledge that any additional waivers of fiduciary fees beyond the
existing waivers and 2005 budgeted amounts may require adjustment to the fees
and expenses set forth on this Schedule 3.1.
DDA BALANCE EARNINGS CREDITS
The Transfer Agent shall retain all DDA balance earnings credits in lieu of
additional fees hereunder and will advise the Fund, upon its request, of the
amount of such balance earnings credits retained by the Transfer Agent.
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PROJECT MANAGEMENT HOURS
The Fund may request assistance from the Transfer Agent project team with the
coordination and usage of any DST Systems, Inc. ("DST") products available for
use by the Fund. The parties acknowledge that while the Transfer Agent will use
all reasonable efforts to assist the Fund as requested, certain systems or
products are proprietary to DST and not under the direct control of the Transfer
Agent. The Transfer Agent project team shall provide up to twelve hundred (1200)
dedicated hours per year, (for all Xxxxxx Associates Funds) without an
additional charge.*** If the project team receives requests for work that would
exceed 1,200 hours in any year, then the requests and estimated hours for each
will be reviewed and approved by senior management of the Fund and the Transfer
Agent prior to the completion of such requested work. The parties agree that
each additional project hour over the maximum 1,200 hours per year and approved
by senior management as described in the foregoing sentence shall be billed at
$125.00 per hour.
***NOTE: Excludes any project in process or requested as of the date hereof.
OUT-OF-POCKET EXPENSES Billed as Incurred****
Out-of-Pocket expenses include but are not limited to: tapes, postage, post
office box rental, supplies, statements, checkwriting, print and mailing
services, information disc (year end), COOL (computer output on-line), freight,
telephone charges, fax lines, 800 line charges, TA2000 voice, disaster recovery,
offsite storage, Vax payroll processing, state tax reporting, NSCC processing,
Fund/SERV, Fan Web, literature requests, lost shareholder searches, lost
shareholder tracking, regulatory compliance charge (per CUSIP), Vision,
escheatment, year-end forms, programming hours (as set forth above), on-request
and scheduled reports, CIP-related search charges and other expenses incurred at
the specific direction of the Fund or with advance written notice to the Fund.
****NOTE: The Transfer Agent reserves the right to introduce specific fee
increases, as necessary, to cover increases in the costs of out-of-pocket
expenses or regulatory changes; provided, that such fee increases are applied on
a universal basis to other clients of the Transfer Agent and that the Transfer
Agent provides 90 days advance written notice to the Fund of each such increase.
E-mail communication directed to the respective parties identified in Section
15.13 of the Agreement shall be deemed a written communication for purposes of
the notice provisions herein.
XXXXXX ASSOCIATES INVESTMENT TRUST BOSTON FINANCIAL DATA SERVICES, INC.
BY: /s/ Xxxx X. Xxxxx BY: /s/ Xxxxxxx Xxx
---------------------------------- ----------------------------------
Name: Xxxx X. Xxxxx Name: Xxxxxxx Xxx
-------------------------------- --------------------------------
Title: President Title: Senior Vice President
------------------------------- -------------------------------
As an Authorized Officer on behalf of the
Fund listed above.
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SCHEDULE 9
TRANSFER AGENT'S LIABILITY
In accordance with the provisions of Section 6 of the Agreement to which this
Schedule 9 is attached, the parties hereto agree that as of the date of this
Agreement, no separate limitation on the liability of Boston Financial has been
established by the parties and Boston Financial's liability, if any, hereunder
shall be determined in accordance with the terms of the Agreement.
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