Exhibit 23(h)(1)
TRANSFER AGENCY AGREEMENT
AGREEMENT dated as of , 2003, between The Integrity Funds
--------
(the "Fund"), a Delaware business trust, having its principal office and place
of business at 0 Xxxx Xxxxxx Xxxxx, Xxxxx, Xxxxx Xxxxxx 00000, and ND Resources,
Inc. (the "Transfer Agent"), a corporation organized under the laws of the State
of North Dakota with its principal place of business at 0 Xxxx Xxxxxx Xxxxx,
Xxxxx, Xxxxx Xxxxxx 00000.
WITNESSETH:
That for and in consideration of the mutual promises hereinafter set
forth, the Fund and the Transfer Agent agree as follows:
DEFINITIONS.
Whenever used in this Agreement, the following words and
phrases, unless the context otherwise requires, shall have the
following meanings:
(a) "Authorized Person" shall be deemed to include the President, the
Vice President, the Secretary, and the Treasurer of the Fund, the
persons listed in Appendix A hereto, and any other person, whether or
not such person is an officer of the Fund, duly authorized to give
Oral Instructions or Written Instructions on behalf of the Fund as
indicated in a certificate furnished to the Transfer Agent pursuant
to Section 5(D) or 5(E) hereof as may be received by the Transfer
Agent from time to time.
(b) "Commission" shall have the meaning given it in the 1940 Act.
(c) "Custodian" refers to the custodian and any sub-custodian of all
securities and other property which the Fund may from time to time
deposit or cause to be deposited or held under the name or account of
such custodian.
(d) "Articles of Incorporation" shall mean the Fund's Articles of
Incorporation as now in effect and as the same may be amended from
time to time.
(e) "Officer" shall mean the President, Vice President, Secretary,
and Treasurer of the parties hereto.
(t) "Oral Instructions" shall mean instructions, other than written
instructions, actually received by the Transfer Agent from a person
reasonably believed by the Transfer Agent to be an Authorized Person.
(g) "Prospectus" shall mean any current prospectus and statement of
additional information relating to the registration of the Fund's
shares under the Securities Act of 1933, as amended, and the 1940
Act.
(h) "Shares" refers to the units into which the shareholders'
proprietary interests in the Fund are divided.
(i) "Shareholder" means a record owner of Shares.
(j) "Trustees" or "Board of Trustees" refers to the duly elected
Trustees of the Fund.
(k) "Written Instructions" shall mean a written or electronic
communication actually received by the Transfer Agent from an
Authorized Person or from a person reasonably believed by the
Transfer Agent to be an Authorized Person by telex or any other such
system whereby the receiver of such communication is able to verify
through codes or otherwise with a reasonable degree of certainty the
authenticity of the sender of such communications.
(1) The "1940 Act" refers to the Investment Company Act of 1940, and
the Rules and Regulations promulgated thereunder, all as amended from
time to time.
2. APPOINTMENT OF THE TRANSFER AGENT.
The Fund hereby appoints and constitutes the Transfer
Agent as transfer agent for its Shares and as Shareholder servicing
agent, and the Transfer Agent accepts such appointment and agrees to
perform the duties hereinafter set forth.
3. COMPENSATION.
(a) The Fund will compensate the Transfer Agent for the performance
of its obligations hereunder in accordance with the fees set forth in
the written schedule of fees annexed hereto as Schedule A and
incorporated herein.
The Transfer Agent will xxxx the Fund as soon as
practicable after the end of each calendar month, and said xxxxxxxx
will be detailed in accordance with the Schedule A. The Fund will
promptly pay to the Transfer Agent the amount of such billing.
(b) Any compensation agreed to hereunder may be adjusted from time to
time upon mutual agreement by both parties hereto by attaching to
Schedule A of this Agreement a revised Fee Schedule, dated and signed
by an Officer of each party hereto.
4. DOCUMENTS.
In connection with the appointment of the Transfer Agent,
the Fund shall, on or before the date this Agreement goes into
effect, but in any case, within a reasonable period of time for the
Transfer Agent to prepare to perform its duties hereunder, furnish
the Transfer Agent with the following documents:
(a) A certified copy of the Fund's Articles of Incorporation, as
amended.
(b) A certified copy of the Fund's Bylaws, as amended.
(c) A copy of the resolution of the Trustees authorizing execution
and delivery of this Agreement.
(d) If applicable, a specimen of the certificate for Shares of the
Fund in the form approved by the Trustees, with a certificate of the
Secretary of the Fund as to such approval.
(e) All account application forms and other documents relating to
Shareholder accounts or to any plan, program, or service offered by
the Fund.
5. FURTHER DOCUMENTATION.
The Fund will also furnish from time to time the following documents:
(a) The Fund's Registration Statement and each subsequent amendment
to the Fund's Registration Statement that is filed with the
Commission.
(b) Certificates as to any change in any Officer, Trustee, or
Investment Adviser of the Fund.
(c) Such other certificates, documents, or opinions as the Transfer
Agent deems to be appropriate or necessary for the proper performance
of its duties hereunder.
6. REPRESENTATIONS OF THE FUND.
The Fund represents to the Transfer Agent that Shares will
be issued in accordance with the terms of the Articles of
Incorporation and the Prospectus and that such Shares shall be
validly issued, fully paid, and non-assessable by the Fund.
In the event that the Trustees shall declare a
distribution payable in Shares, the Fund shall deliver to the
Transfer Agent written notice of such declaration signed on behalf of
the Fund by an Officer of the Fund, upon which the Transfer Agent
shall be entitled to rely for all purposes, certifying (i) the number
of Shares involved, (ii) that all appropriate action has been taken,
and (iii) that any amendment to the Articles of Incorporation which
may be required has been filed and is effective. Such notice shall be
accompanied by an opinion of counsel for the Fund relating to the
legal adequacy and effect of the transaction. This provision shall
not apply to Shares to be issued in the normal course of reinvestment
of any distributions or dividends in accordance with the Fund's
Prospectus.
7. DUTIES OF THE TRANSFER AGENT.
The Transfer Agent shall be responsible for administering
and/or performing transfer agent functions; for acting as service
agent in connection with dividend and distribution functions; and for
performing Shareholder account and administrative agent functions in
connection with the issuance, transfer, and redemption or repurchase
(including coordination with the Custodian) of Shares. The operating
standards and procedures to be followed shall be determined from time
to time by agreement between the Transfer Agent and the Fund and
shall be expressed in a written schedule of duties of the Transfer
Agent annexed hereto as Schedule B and incorporated herein.
8. RECORDKEEPING AND OTHER INFORMATION.
The Transfer Agent shall create and maintain all necessary
records in accordance with all applicable laws, rules and
regulations, including, but not limited to, records required by
Section 31(a) of the 1940 Act and those records pertaining to the
various functions performed by it hereunder which are set forth in
Schedule B hereto. All records shall be available during regular
business hours for inspection and use by the Fund. Where applicable,
such records shall be maintained by the Transfer Agent for the
periods and in the places required by Rule 31a-2 under the 1940 Act.
Upon reasonable notice by the Fund, the Transfer Agent
shall make available during regular business hours its facilities and
premises employed in connection with the performance of its duties
under this Agreement for reasonable visitation by the Fund or any
person retained by the Fund.
To the extent required by said Section 31 and the rules
and regulations thereunder, the Transfer Agent agrees that all such
records prepared and maintained by the Transfer Agent relating to the
services to be performed by the Transfer Agent hereunder are the
property of the Fund.
The Transfer Agent and the Fund agree that all books,
records, information, and data pertaining to the business of the
other party which are exchanged or received in connection with this
Agreement shall remain confidential and shall not be voluntarily
disclosed to any person, except as may be required by law. In the
case of any requests or demands for any inspection of the Shareholder
records of the Fund, the Transfer Agent will endeavor to notify the
Fund and to secure instructions from an authorized Officer of the
Fund as to such inspection.
9. OTHER DUTIES.
In addition to the duties expressly set forth in Schedule B
to this Agreement, the Transfer Agent shall perform such other duties
and functions, and shall be paid such amounts therefore, as may from
time to time be agreed upon in writing between the Fund and the
Transfer Agent. Such other duties and functions shall be reflected in
a written amendment to Schedule B, dated and signed by an Officer of
each party hereto.
10. RELIANCE BY TRANSFER AGENT; INSTRUCTIONS.
(a) The Transfer Agent will be protected in acting upon Written or
Oral Instructions, as appropriate, believed to have been executed or
orally communicated by an Authorized Person and will not be held to
have any notice of any change of authority of any person until receipt
of a Written Instruction thereof from the Fund. The Transfer Agent
will also be protected in processing Share certificates which it
reasonably believes to bear the proper manual or facsimile signatures
of the Officers of the Fund and the proper countersignature of the
Transfer Agent.
(b) At any time the Transfer Agent may apply to any Authorized Person
of the Fund for Written Instructions and may seek advice from legal
counsel for the Fund, or its own legal counsel, with respect to any
matter arising in connection with this Agreement, and it shall not be
liable for any action taken or not taken or suffered by it in good
faith in accordance with such Written Instructions or in accordance
with the opinion of counsel for the Fund or for the Transfer Agent;
provided, however, that if such reliance involves a potential material
loss to the Fund, the Transfer Agent will advise the Fund of any such
action(s) to be taken in accordance with the opinion of counsel to the
Transfer Agent. Written Instructions requested by the Transfer Agent
will be provided by the Fund within a reasonable period of time. In
addition, the Transfer Agent, its officers, agents, or employees,
shall accept Oral Instructions or Written Instructions given to them
by any person representing or acting on behalf of the Fund only if
said representative is known by the Transfer Agent, or its officers,
agents, or employees, to be an Authorized Person. The Transfer Agent
shall have no duty or obligation to inquire into, nor shall the
Transfer Agent be responsible for, the legality of any act done by it
upon the request or direction of an Authorized Person.
(c) Notwithstanding any of the foregoing provisions of this Agreement,
the Transfer Agent shall be under no duty or obligation to inquire
into, and shall not be liable for:
(1) the legality of the issuance or sale of any Shares or
the sufficiency of the amount to be received therefore;
(2) the legality of the redemption of any Shares, or the
propriety of the amount to be paid therefore;
(3) the legality of the declaration of any dividend by the
Trustees, or the legality of the issuance of any Shares in
payment of any dividend; or
(4) the legality of any recapitalization or readjustment of
the Shares.
11. ACTS OF GOD. ETC.
Neither the Transfer Agent nor the Fund will be liable or
responsible for delays or errors by reason of circumstances beyond
its reasonable control, including acts of civil or military
authority, national emergencies, fire, mechanical breakdown beyond
its control, flood or catastrophe, acts of God, insurrection, war,
riots, or failure beyond its control of transportation,
communication, or power supply.
12. DUTY OF CARE AND INDEMNIFICATION.
The Fund and the Transfer Agent will indemnify each other
against and hold the other party harmless from any and all losses,
claims, damages, liabilities, or expenses (including reasonable
counsel fees and expenses) resulting from any claim, demand, action,
or suit not resulting from the bad faith or negligence of the other
party, and arising out of, or in connection with, the duties and
responsibilities described hereunder. In addition, the Fund will
indemnify the Transfer Agent against and hold it harmless from any
and all losses, claims, damages, liabilities, or expenses (including
reasonable counsel fees and expenses) resulting from any claim
demand, action, or suit as a result of:
(1) any action taken in accordance with Written or Oral
Instructions, or any other instructions, or Share
certificates reasonably believed by the Transfer Agent to
be genuine and to be signed, countersigned or executed, or
orally communicated by an Authorized Person;
(2) any action taken in accordance with written or oral
advice reasonably believed by the Transfer Agent to have
been given by counsel for the Fund or its own counsel; or
(3) any action taken as a result of any error or omission
in any record (including but not limited to magnetic tapes,
computer printouts, hard copies, and microfilm copies)
delivered or caused to be delivered by the Fund to the
Transfer Agent in connection with this Agreement.
In any case in which the Fund or the Transfer Agent may be
asked to indemnify or hold the other party harmless, the requesting
party will provide the other party with all pertinent facts
concerning the situation in question and will use reasonable care to
identify and provide notice of any situation which presents or
appears likely to present a claim for indemnification. Each party
shall have the option to defend the other party against any claim
which may be the subject of this indemnification, and in the event
that a party so elects, such defense shall be conducted by counsel
chosen by the party making such election; and such counsel shall be
satisfactory to the other party, and thereupon such electing party
shall take over complete defense of the claim, and the requesting
party shall Sustain no further legal or other expenses in such
situation for which it seeks indemnification under this Section 12.
Neither party will confess any claim or make any compromise in any
case in which the other party will be asked to provide
indemnification, except with the other party's prior written consent.
The obligations of the parties hereto under this Section shall
survive the termination of this Agreement.
13. TERM AND TERMINATION.
This Agreement shall become effective on the date first set
forth above (the "Effective Date") and shall continue in effect from
year to year thereafter as the parties may mutually agree; provided,
that either party hereto may terminate this Agreement by giving to
the other party a notice in writing specifying the date of such
termination, which shall be not less than 60 days after the date of
receipt of such notice. In the event such notice is given by the
Fund, it shall be accompanied by a resolution of the Board of
Trustees of the Fund, certified by the Secretary, electing to
terminate this Agreement and designating a successor transfer agent
or transfer agents. Upon such termination and at the expense of the
Fund, the Transfer Agent will deliver to such successor a certified
list of Shareholders of the Fund (with names, addresses, and taxpayer
identification or Social Security numbers), an historical record of
the account of each Shareholder and the status thereof, and all other
relevant books, records, correspondence, and other data established
or maintained by the Transfer Agent under this Agreement in the form
reasonably acceptable to the Fund, and will cooperate in the transfer
of such duties and responsibilities, including provisions for
assistance from the Transfer Agent's personnel in the establishment
of books, records, and other data by such successor or successors.
14. AMENDMENT.
This Agreement may not be amended or modified in any manner
except by a written agreement executed by both parties.
15. SUBCONTRACTING.
Except as otherwise provided below, neither this Agreement
nor any rights or obligations hereunder may be assigned by either
party without the express written consent of the other party. The
Transfer Agent may, in its sole discretion and without further
approval from the Fund, subcontract, in whole or in part, for the
performance of its obligations and duties hereunder with any person
or entity including, but not limited to, any affiliate or subsidiary;
provided, however, that (a) the Transfer Agent shall remain fully
responsible to the Fund for the acts and omissions of any agent or
subcontractor as it is for its own acts and omissions, and (b) to the
extent that the Transfer Agent subcontracts any functions or
activities required or performed by a registered transfer agent, the
subcontracting party shall be a duly registered transfer agent with
the appropriate regulatory agency as required under Section 17A of
the Securities Exchange Act of 1934 and the rules and regulations
thereunder, as amended.
16. USE OF TRANSFER AGENT'S NAME.
The Fund shall not use the name of the Transfer Agent in
any Prospectus, Statement of Additional Information, Shareholders'
report, sales literature, or other material relating to the Fund for
other than internal use, in a manner not approved prior thereto;
provided, that the Transfer Agent shall approve all reasonable uses
of its name which merely refer in accurate terms to its appointment
hereunder or which are required by the Commission or a state
securities administrator.
17. USE OF THE FUND'S NAME.
The Transfer Agent shall not use the name of the Fund or
material relating to the Fund on any documents or forms for other
than internal use in a manner not approved prior thereto in writing;
provided, that the Fund shall approve all reasonable uses of its name
which merely refer in accurate terms to the appointment of the
Transfer Agent or which are required by the Commission or a state
securities administrator.
18. SECURITY.
The Transfer Agent represents and warrants that, to the
best of its knowledge, the various procedures and systems which the
Transfer Agent has implemented or will implement with regard to
safeguarding from loss or damage attributable to fire; theft, or any
other cause (including provision for 24 hours-a-day restricted
access) of the Fund's records and other data and the Transfer Agent's
records, data, equipment, facilities, and other property used in the
performance of its obligations hereunder are adequate and that it
will make such changes therein from time to time as in its judgment
are required for the secure performance of its obligations hereunder.
The parties shall review such systems and procedures on a periodic
basis.
19. MISCELLANEOUS.
(a) Any notice or other instrument authorized or required by this
Agreement to be given in writing to the Fund or the Transfer Agent
shall be sufficiently given if addressed to that party and received
by it at its office set forth below or at such other place as it may
from time to time designate in writing.
To the Fund:
The Integrity Funds
0 Xxxx Xxxxxx Xxxxx
Xxxxx, XX 00000
To the Transfer Agent:
ND Resources, Inc.
0 Xxxx Xxxxxx Xxxxx
Xxxxx, XX 00000
(b) This Agreement shall extend to and shall be binding upon the
parties hereto, and their respective successors and assigns;
provided, however, that this Agreement shall not be assignable by the
Fund without the written consent of the other party.
(c) This Agreement shall be construed in accordance with the laws of
the State of North Dakota.
(d) This Agreement may be executed in any number of counterparts,
each of which shall be deemed to be an original; but such
counterparts shall, together, constitute only one instrument.
(e) The captions of this Agreement are included for convenience of
reference only and in no way define or delimit any of the provisions
hereof or otherwise affect their construction or effect.
20. LIABILITY OF TRUSTEES, OFFICERS, AND SHAREHOLDERS.
The execution and delivery of this Agreement have been
authorized by the Trustees of the Fund and signed by an authorized
Officer of the Fund, acting as such, and neither such authorization
by such Trustees nor such execution and delivery by such Officer
shall be deemed to have been made by any of them individually or to
impose any liability on any of them personally, and the obligations
of this Agreement are not binding upon any of the Trustees or
Shareholders of the Fund, but bind only the property of the Fund.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their respective corporate officers thereunder duly authorized as
of the day and year first above written.
THE INTEGRITY FUNDS
By
-------------------------
Date: April , 2003
-----
Agreed and Accepted by:
ND RESOURCES, INC.
By
------------------------
Date: April , 2003
------
APPENDIX A
I, Xxxxxx X. Xxxxxxx, President of The Integrity Funds (the "Fund"),
a Delaware business trust, do hereby certify that the following individuals have
been duly authorized as Authorized Persons to give Oral Instructions and Written
Instructions on behalf of the Fund, and the signatures set forth opposite their
respective names are their true and correct signatures:
NAME SIGNATURE
Xxxxxx X. Xxxxxxx ---------------------------------------
---------------------------------------
Xxxxxx X. Xxxxxxx
---------------------------------------
Xxxxx X. Xxxxxxx
---------------------------------------
Xxxxxx Xxxxxx
---------------------------------------
Xxxxx Xxxxx
SCHEDULE A*
FEE SCHEDULE
TRANSFER AGENT CHARGES
ND RESOURCES, INC.
For the Transfer Agency services provided under this agreement, each Fund will
pay to ND Resources, Inc. at the end of each calendar month a fee of 0.25% of
average daily net assets with a minimum of $2,000 per month plus reimbursement
of out of pocket expenses. An additional fee with a minimum of $500 per month
will be charged for each additional share class.
SCHEDULE B
DUTIES OF THE TRANSFER AGENT
(See Exhibit 1 for Summary of Services.)
1. SHAREHOLDER INFORMATION.
The Transfer Agent shall maintain a record of the number of
Shares held by each holder of record which shall include his address
and taxpayer identification number and which shall indicate whether
such Shares are held in certificated or uncertificated form.
2. SHAREHOLDER SERVICES.
The Transfer Agent will investigate all Shareholder
inquiries relating to Shareholder accounts and will answer all
correspondence from Shareholders and others relating to its duties
hereunder and such other correspondence as may from time to time be
mutually agreed upon between the Transfer Agent and the Fund. The
Transfer Agent shall keep records of Shareholder correspondence and
replies thereto and of the lapse of time between the receipt of such
correspondence and the mailing of such replies.
3. STATE REGISTRATION REPORTS.
The Transfer Agent shall furnish on a state-by-state basis
sales reports and such periodic and special reports as the Fund may
reasonably request and such other information, including Shareholder
lists and statistical information concerning accounts, as may be
agreed upon from time to time between the Fund and the Transfer
Agent.
4. MAILING COMMUNICATIONS TO SHAREHOLDERS; PROXY MATERIALS.
The Transfer Agent will address and mail to Shareholders of
the Fund all reports to Shareholders, dividend and distribution
notices, and proxy material for the Fund's meetings of Shareholders.
In connection with meetings of Shareholders, the Transfer Agent will
report on proxies voted prior to meetings, act as inspector of
election at meetings, if so requested by the Fund, and certify Shares
voted at meetings.
5. SALES OF SHARES.
(a) PROCESSING OF INVESTMENT CHECKS OR OTHER INVESTMENTS. Upon
receipt of any check or other instrument drawn or endorsed to it as
agent for, or identified as being for the account of the Fund for the
purchase of Shares, the Transfer Agent shall stamp the check with the
date of receipt, shall forthwith process the same for collection, and
shall record the number of Shares sold, the trade date, the price per
Share, and the amount of money to be delivered to the Custodian of
the Fund for the sale of such Shares.
(b) ISSUANCE OF SHARES. Upon receipt of notification that the
Custodian has received the amount of money specified in the
immediately preceding paragraph, the Transfer Agent shall issue to
and hold in the account of the purchaser/Shareholder, or if no
account is specified therein, in a new account established in the
name of the purchaser, the number of Shares such purchaser is
entitled to receive, as determined in accordance with applicable
federal law or regulation.
(c) STATEMENTS. On a quarterly basis, the Transfer Agent shall send
to the purchaser/Shareholder a statement of purchases which will show
the new Share balance, the Shares held under a particular plan, if
any, for withdrawing investments, the amount invested and the price
paid for the newly purchased Shares, or will be in such other form of
statement as the Fund and the Transfer Agent may agree from time to
time.
(d) SUSPENSION OF SALE OF SHARES. The Transfer Agent shall not be
required to issue any Shares where it has received a Written
Instruction from the Fund or written notice from any appropriate
federal or state authority that the sale of the Shares of the Fund
has been suspended or discontinued, and the Transfer Agent shall be
entitled to rely upon such Written Instructions or written
notification.
(e) TAXES IN CONNECTION WITH ISSUANCE OF SHARES. Upon the issuance of
any Shares in accordance with the foregoing provisions of this
Section, the Transfer Agent shall not be responsible for the payment
of any original issue or other taxes required to be paid in
connection with such issuance.
(f) RETURNED CHECKS. In the event that any check or other order for
the payment of money is returned unpaid for any reason, the Transfer
Agent will:
(1) give prompt notice of such return to the Fund or its
designee;
(2) place a stop transfer order against all Shares issued
as a result of such check or order; and
(3) take such actions as the Transfer Agent may from time
to time deem appropriate.
6. REDEMPTIONS.
(a) REQUIREMENTS FOR TRANSFER OR REDEMPTION OF SHARES. The Transfer
Agent shall process all requests from Shareholders to transfer or
redeem Shares in accordance with the procedures set forth in the
Prospectus and all determinations of the number of Shares required to
be redeemed to fund designated monthly payments, automatic payments,
or any other such distribution or withdrawal plan.
The Transfer Agent will transfer or redeem Shares upon
receipt of Written Instructions and Share certificates, if any,
properly endorsed for transfer or redemption, accompanied by such
documents as the Transfer Agent reasonably may deem necessary to
evidence the authority of the person making such transfer or
redemption, and bearing satisfactory evidence of the payment of stock
transfer taxes, if any.
Except to the extent inconsistent with the procedures set
forth in the Prospectus, the Transfer Agent reserves the right to
refuse to transfer or redeem Shares until it is satisfied that the
endorsement
on the instructions is valid and genuine, and for that purpose it
will require a guarantee of signature by a member firm of a national
securities exchange, by any national bank or trust company, or by any
member bank of the Federal Reserve system. The Transfer Agent also
reserves the right to refuse to transfer or redeem Shares until it is
satisfied that the requested transfer or redemption is legally
authorized, and it shall incur no liability for the refusal, in good
faith, to make transfers or redemptions which the Transfer Agent, 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 redemption.
The Transfer Agent may, in effecting transactions, rely
upon the provisions of the Uniform Act for the Simplification of
Fiduciary Security Transfers or the provisions of Article 8 of the
Uniform Commercial Code, as the same may be amended from time to time
in the State of North Dakota, which in the opinion of legal counsel
for the Fund or of its own legal counsel protect it in not requiring
certain documents in connection with the transfer or redemption of
Shares. The Fund may authorize the Transfer Agent to waive the
signature guarantee in certain cases by Written Instructions.
For the purpose of the redemption of Shares which have been
purchased within 15 days of a redemption request, the Transfer Agent
may refuse to redeem such Shares until the Transfer Agent has
received fed funds for the purchase of such Shares.
(b) NOTICE TO CUSTODIAN AND FUND. When Shares are redeemed, the
Transfer Agent shall, upon receipt of the instructions and documents
in proper form, deliver to the Custodian and the Fund a notification
setting forth the number of Shares to be redeemed. Such redemptions
shall be reflected on appropriate accounts maintained by the Transfer
Agent reflecting outstanding Shares and Shares attributed to
individual accounts and, if applicable, any individual withdrawal or
distribution plan.
(c) PAYMENT OF REDEMPTION PROCEEDS. The Transfer Agent shall, upon
receipt of the moneys paid to it by the Custodian for the redemption
of Shares, pay to the Shareholder, or his authorized agent or legal
representative, such moneys as are received from the Custodian, all
in accordance with the redemption procedures described in the
Prospectus; provided, however, that the Transfer Agent shall pay the
proceeds of any redemption of Shares purchased within 15 days of a
redemption request to the Transfer Agent upon a determination that
good funds have been collected for the purchase of such Shares. The
Fund shall indemnify the Transfer Agent for any payment of redemption
proceeds or refusal to make such payment if the payment or refusal to
pay is in accordance with this Section.
The Transfer Agent shall not process or effect any
redemptions pursuant to a plan of distribution or redemption or in
accordance with any other Shareholder request upon the receipt by the
Transfer Agent of notification of the suspension of the determination
of the Fund net asset value.
7. DIVIDENDS.
(a) NOTICE TO TRANSFER AGENT AND CUSTODIAN. Upon the declaration of
each dividend and each capital gains distribution by the Board of
Trustees of the Fund with respect to Shares, the Fund shall furnish
to the Transfer Agent a copy of a resolution of its Board of Trustees
certified by the Secretary setting forth with respect to the Shares
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 to the Transfer Agent 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 Trustees, the Fund will cause the Custodian of the
Fund to pay to the Transfer Agent sufficient cash to make payment to
the Shareholders of record as of such payment date.
(b) PAYMENT OF DIVIDENDS BY THE TRANSFER AGENT. The Transfer Agent
will, on the designated monthly payment date, automatically reinvest
all dividends in additional Shares at net asset value (determined on
such date) and mail to each Shareholder on a quarterly basis at his
address of record, or such other address as the Shareholder may have
designated, a statement showing the number of full and fractional
Shares (rounded to three decimal places) then currently owned by the
Shareholder and the net asset value of the Shares so credited to the
Shareholder's account; provided, however, that if the Transfer Agent
has on file a direction by the Shareholder to pay income dividends or
capital gains dividends, or both, in cash, such dividends shall be
paid in accordance with such instructions; and provided further, that
in the event of the return of two consecutive dividend checks as
undeliverable, Transfer Agent shall change such Shareholder account
to a reinvestment account if so provided in the Prospectus.
(c) INSUFFICIENT FUNDS FOR PAYMENTS. If the Transfer Agent does not
receive sufficient cash from the Custodian to make total dividend
and/or distribution payments to all Shareholders of the Fund as of
the record date, the Transfer Agent will, upon notifying the Fund,
withhold payment to all Shareholders of record as of the record date
until such sufficient cash is provided to the Transfer Agent.
(d) INFORMATION RETURNS. It is understood that the Transfer Agent
shall file such appropriate information returns concerning the
payment of dividends, return of capital, and capital gain
distributions with the proper federal, state, and local authorities
as are required by law to be filed and shall be responsible for the
withholding of taxes, if any, due on such dividends or distributions
to Shareholders when required to withhold taxes under applicable law.
