Exhibit (h)(2)
SERVICES AGREEMENT
THIS AGREEMENT, dated as of this 10th day of December, 1998 (the "Effective
Date") between PPM AMERICA FUNDS (the "Fund"), a Massachusetts business trust
having its principal place of business at 000 Xxxx Xxxxxx Xxxxx, Xxxxx 0000,
Xxxxxxx, Xxxxxxxx 00000 and FIRST DATA INVESTOR SERVICES GROUP, INC. ("Investor
Services Group"), a Massachusetts corporation with principal offices at 0000
Xxxxxxxx Xxxxx, Xxxxxxxx, Xxxxxxxxxxxxx 00000.
WITNESSETH
WHEREAS, the Fund is authorized to issue Shares in separate series, with
each such series representing interests in a separate portfolio of securities or
other assets;
WHEREAS, the Fund initially intends to offer Shares in those Portfolios
identified in the attached Schedule A, each such Portfolio, together with all
other Portfolios subsequently established by the Fund shall be subject to this
Agreement in accordance with Article 14;
WHEREAS, the Fund on behalf of the Portfolios, desires to appoint Investor
Services Group as its blue sky agent, transfer agent, dividend disbursing agent
and agent in connection with certain other activities and Investor Services
Group desires to accept such appointment;
NOW, THEREFORE, in consideration of the mutual covenants and promises
hereinafter set forth, the Fund and Investor Services Group agree as follows:
Article 1 DEFINITIONS.
1.1 Whenever used in this Agreement, the following words and phrases,
unless the context otherwise requires, shall have the following meanings:
(a) "Articles of Incorporation" shall mean the Articles of
Incorporation, Agreement and Declaration of Trust, or other similar
organizational document as the case may be, of the Fund as the same may be
amended from time to time.
(b) "Authorized Person" shall be deemed to include (i) any authorized
officer of the Fund; or (ii) any person, whether or not such person is an
officer or employee of the Fund, duly authorized to give Oral Instructions
or Written Instructions on behalf of the Fund to Investor Services Group
from time to time.
(c) "Board Members" shall mean the Directors or Trustees of the
governing body of the Fund, as the case may be.
(d) "Board of Trustees" shall mean the Board of Directors or Board of
Trustees of the Fund, as the case may be.
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(e) "Commencement Date" shall mean the date on which Investor
Services Group commences providing services to the Fund pursuant to this
Agreement.
(f) "Commission" shall mean the Securities and Exchange Commission.
(g) "Custodian" refers to any custodian or subcustodian with which
the Fund may from time to time deposit, or cause to be deposited, or held
under the name or account of such a custodian pursuant to a Custodian
Agreement.
(h) "1934 Act" shall mean the Securities Exchange Act of 1934 and
the rules and regulations promulgated thereunder, all as amended from time
to time.
(i) "1940 Act" shall mean the Investment Company Act of 1940 and the
rules and regulations promulgated thereunder, all as amended from time to
time.
(j) "Oral Instructions" shall mean instructions, other than Written
Instructions, actually received by Investor Services Group from a person
reasonably believed by Investor Services Group to be an Authorized Person.
(k) "Portfolio" shall mean each separate series of shares offered by
the Fund representing interests in a separate portfolio of securities and
other assets.
(l) "Prospectus" shall mean the most recently dated Fund Prospectus
and Statement of Additional Information, including any supplements thereto
if any, which has become effective under the Securities Act of 1933 and the
1940 Act.
(m) "Shares" refers collectively to such shares of capital stock or
beneficial interest, as the case may be, or class thereof, of each
respective Portfolio of the Fund as may be issued from time to time.
(n) "Shareholder" shall mean a record owner of Shares of each
respective Portfolio of the Fund.
(o) "Written Instructions" shall mean a written communication signed
by a person reasonably believed by Investor Services Group to be an
Authorized Person and actually received by Investor Services Group.
Written Instructions shall include manually executed originals and
authorized electronic transmissions, including telefacsimile of a manually
executed original or other process.
Article 2 APPOINTMENT OF INVESTOR SERVICES GROUP.
The Fund, on behalf of the Portfolios, hereby appoints and constitutes
Investor Services Group as its sole and exclusive transfer agent, dividend
disbursing agent for Shares of each respective Portfolio, blue sky agent and
shareholder servicing agent and Investor Services Group hereby accepts such
appointments and agrees to perform the duties hereinafter set forth. This
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Agreement shall be effective as of the Effective Date.
Article 3 DUTIES OF INVESTOR SERVICES GROUP.
3.1 Investor Services Group shall be responsible for:
(a) Administering and/or performing the customary services of a
transfer agent; 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 of each Portfolio, as more fully described in the written schedule
of Duties of Investor Services Group annexed hereto as Schedule B and
incorporated herein, and in accordance with the terms of the Prospectus of
the Fund, applicable law and the procedures established from time to time
between Investor Services Group and the Fund.
(b) Recording the issuance of Shares and maintaining pursuant to
Commission Rule 17Ad-10(e) of the 1934 Act a record of the total number of
Shares of each Portfolio which are authorized, based upon data provided to
it by the Fund, and issued and outstanding. Investor Services Group shall
provide the Fund on a regular basis with the total number of Shares of each
Portfolio 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.
(c) Investor Services Group shall be responsible for the following:
performing the customary services of a blue sky agent for the Fund, as more
fully described in the written schedule of Duties of Investor Services
Group annexed hereto as Schedule B and incorporated herein, and subject to
the oversight of the Board of Trustees of the Fund.
(d) Notwithstanding any of the foregoing provisions of this
Agreement, Investor Services Group shall be under no duty or obligation to
inquire into, and shall not be liable for: (i) the legality of the
issuance or sale of any Shares or the sufficiency of the amount to be
received therefor; (ii) the legality of the redemption of any Shares, or
the propriety of the amount to be paid therefor; (iii) the legality of the
declaration of any dividend by the Board of Trustees, or the legality of
the issuance of any Shares in payment of any dividend; or (iv) the legality
of any recapitalization or readjustment of the Shares.
3.2 In performing its duties under this Agreement, Investor Services
Group: (a) will act in accordance with the Articles of Incorporation, By-Laws,
Prospectuses and with the Oral Instructions and Written Instructions of the Fund
and will conform to and comply with the requirements of the 1940 Act and all
other applicable federal or state laws and regulations; and (b) will consult
with legal counsel to the Fund, as necessary and appropriate. Furthermore,
Investor Services Group shall not have or be required to have any authority to
supervise the
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investment or reinvestment of the securities or other properties which comprise
the assets of the Fund or any of its Portfolios and shall not provide any
investment advisory services to the Fund or any of its Portfolios.
3.3 In addition to the duties set forth herein, Investor Services Group
shall perform such other duties and functions, and shall be paid such amounts
therefor, as may from time to time be agreed upon in writing between the Fund
and Investor Services Group.
Article 4 RECORDKEEPING AND OTHER INFORMATION.
4.1 Investor Services Group shall create and maintain all records required
of it pursuant to its duties hereunder and as set forth in Schedule B in
accordance with all applicable laws, rules and regulations, including records
required by Section 31(a) of the 1940 Act. Where applicable, such records
shall be maintained by Investor Services Group for the periods and in the places
required by Rule 31a-2 under the 1940 Act.
4.2 To the extent required by Section 31 of the 1940 Act, Investor
Services Group agrees that all such records prepared or maintained by Investor
Services Group relating to the services to be performed by Investor Services
Group hereunder are the property of the Fund and will be preserved, maintained
and made available in accordance with such section, and shall be surrendered
promptly to the Fund on and in accordance with the Fund's request.
4.3 In case of any requests or demands for the inspection of Shareholder
records of the Fund, Investor Services Group shall promptly notify the Fund of
such request and secure Written Instructions as to the handling of such request.
Investor Services Group reserves the right, however, to exhibit the Shareholder
records to any person whenever it is advised by its counsel that it may be held
liable for the failure to comply with such request.
Article 5 FUND INSTRUCTIONS.
5.1 Investor Services Group shall have no liability when acting upon
Written or Oral Instructions reasonably believed to have been executed or orally
communicated by an Authorized Person and shall 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.
5.2 At any time, Investor Services Group may request Written Instructions
from the Fund and may seek advice from legal counsel for the Fund 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 except when such liability is the result of its own
negligence or willful misconduct. Written Instructions requested by Investor
Services Group will be provided by the Fund within a reasonable period of time.
5.3 Investor Services Group, its officers, agents or employees, shall
accept Oral Instructions or Written Instructions given to them by any person
representing or acting on behalf
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of the Fund only if said representative is an Authorized Person. The Fund
agrees that all Oral Instructions shall be followed promptly by confirming
Written Instructions, and that the Fund's failure to so confirm shall not impair
in any respect Investor Services Group's right to rely on Oral Instructions.
Article 6 COMPENSATION.
6.1 The Fund on behalf of each of the Portfolios will compensate Investor
Services Group for the performance of its obligations hereunder in accordance
with the fees set forth in the written Fee Schedule annexed hereto as Schedule C
and incorporated herein.
6.2 In addition to those fees set forth in Section 6.1 above, the Fund on
behalf of each of the Portfolios agrees to pay, and will be billed separately
for, out-of-pocket expenses reasonably incurred by Investor Services Group in
the performance of its duties hereunder. Out-of-pocket expenses shall include,
but shall not be limited to, the items specified in the written schedule of
out-of-pocket charges annexed hereto as Schedule D and incorporated herein.
Schedule D may be modified by written agreement between the parties.
Unspecified out-of-pocket expenses shall be limited to those out-of-pocket
expenses reasonably incurred by Investor Services Group in the performance of
its obligations hereunder. Investor Services Group shall not be required to pay
any Blue Sky registration or filing fees unless and until it has received the
amount of such fees from the Fund.
6.3 The Fund on behalf of each of the Portfolios agrees to pay all fees
and out-of-pocket expenses to Investor Services Group by Federal Funds Wire or
Federal Funds check within thirty (30) business days following the receipt of
the respective invoice. In addition, with respect to all fees under this
Agreement, Investor Services Group may charge a service fee equal to the lesser
of (i) one and one half percent (1 1/2%) per month or (ii) the highest interest
rate legally permitted on any past due invoiced amounts.
6.4 Any compensation agreed to hereunder may be adjusted from time to time
by attaching to Schedule C, a revised Fee Schedule executed and dated by the
parties hereto.
6.5 Investor Services Group may from time to time employ or associate with
itself such person or persons as Investor Services Group may believe to be
particularly suited to assist it in performing services under this Agreement.
Such person or persons may be officers and employees who are employed by both
Investor Services Group and the Fund. The compensation of such person or
persons shall be paid by Investor Services Group and no obligation shall be
incurred on behalf of the Fund in such respect.
Article 7 DOCUMENTS.
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In connection with the appointment of Investor Services Group, the Fund
shall, on or before the date this Agreement goes into effect, but in any case
within a reasonable period of time for Investor Services Group to prepare to
perform its duties hereunder, deliver or caused to be delivered to Investor
Services Group the documents set forth in the written schedule of Fund Documents
annexed hereto as Schedule E.
Article 8 INVESTOR SERVICES GROUP SYSTEM.
8.1 Investor Services Group shall retain title to and ownership of any and
all data bases, computer programs, screen formats, report formats, interactive
design techniques, derivative works, inventions, discoveries, patentable or
copyrightable matters, concepts, expertise, patents, copyrights, trade secrets
in connection with the services provided by Investor Services Group to the Fund
herein (the "Investor Services Group System"), and other related legal rights
utilized by Investor Services Group in connection with the Investor Services
Group System.
8.2 Investor Services Group hereby grants to the Fund a limited license to
the Investor Services Group System for the sole and limited purpose of having
Investor Services Group provide the services contemplated hereunder and nothing
contained in this Agreement shall be construed or interpreted otherwise and such
license shall immediately terminate upon the termination of this Agreement.
8.3 In the event that the Fund, including any affiliate or agent of the
Fund or any third party acting on behalf of the Fund is provided with direct
access to the Investor Services Group System for either account inquiry or to
transmit transaction information, including but not limited to maintenance,
exchanges, purchases and redemptions, such direct access capability shall be
limited to direct entry to the Investor Services Group System by means of
on-line mainframe terminal entry or PC emulation of such mainframe terminal
entry and any other non-conforming method of transmission of information to or
from the Investor Services Group System is strictly prohibited without the prior
written consent of Investor Services Group.
Article 9 REPRESENTATIONS AND WARRANTIES.
9.1 Investor Services Group represents and warrants to the Fund that:
(a) it is a corporation duly organized, existing and in good standing
under the laws of the Commonwealth of Massachusetts;
(b) it is empowered under applicable laws and by its Articles of
Incorporation and By-Laws to enter into and perform this Agreement;
(c) all requisite corporate proceedings have been taken to authorize
it to enter into this Agreement;
(d) it is duly registered with its appropriate regulatory agency as a
transfer
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agent and such registration will remain in full effect for the duration of
this Agreement; and
(e) it has and will continue to have access to the necessary
facilities, equipment and personnel to perform its duties and obligations
under this Agreement.
9.2 The Fund represents and warrants to Investor Services Group that:
(a) it is duly organized, existing and in good standing under the
laws of the jurisdiction in which it is organized;
(b) it is empowered under applicable laws and by its Articles of
Incorporation and By-Laws to enter into this Agreement;
(c) all corporate proceedings required by said Articles of
Incorporation, By-Laws and applicable laws have been taken to authorize it
to enter into this Agreement;
(d) a registration statement under the Securities Act of 1933, as
amended, and the 1940 Act on behalf of each of the Portfolios is currently
effective and will remain effective, and all appropriate state securities
law filings have been made and will continue to be made, with respect to
all Shares of the Fund being offered for sale; and
(e) all outstanding Shares are validly issued, fully paid and
non-assessable and when Shares are hereafter issued in accordance with the
terms of the Fund's Articles of Incorporation and its Prospectus with
respect to each Portfolio, such Shares shall be validly issued, fully paid
and non-assessable.
9.3 THIS IS A SERVICE AGREEMENT. EXCEPT AS EXPRESSLY PROVIDED IN THIS
AGREEMENT, INVESTOR SERVICES GROUP DISCLAIMS ALL OTHER REPRESENTATIONS OR
WARRANTIES, EXPRESS OR IMPLIED, MADE TO THE FUND OR ANY OTHER PERSON, INCLUDING,
WITHOUT LIMITATION, ANY WARRANTIES REGARDING QUALITY, SUITABILITY,
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE OR OTHERWISE (IRRESPECTIVE OF
ANY COURSE OF DEALING, CUSTOM OR USAGE OF TRADE) OF ANY SERVICES OR ANY GOODS
PROVIDED INCIDENTAL TO SERVICES PROVIDED UNDER THIS AGREEMENT. INVESTOR
SERVICES GROUP DISCLAIMS ANY WARRANTY OF TITLE OR NON-INFRINGEMENT EXCEPT AS
OTHERWISE SET FORTH IN THIS AGREEMENT.
Article 10 INDEMNIFICATION.
10.1 Investor Services Group shall not be responsible for and the Fund on
behalf of each Portfolio shall indemnify and hold Investor Services Group
harmless from and against any and all claims, costs, expenses (including
reasonable attorneys' fees), losses, damages, charges,
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payments and liabilities of any sort or kind (a "Claim") arising out of or
attributable to any of the following:
(a) any actions of Investor Services Group required to be taken
pursuant to this Agreement unless such Claim resulted from a negligent act
or omission to act, bad faith or willful misconduct by Investor Services
Group;
(b) Investor Services Group's reasonable reliance on, or reasonable
use of information, data, records and documents (including but not limited
to magnetic tapes, computer printouts, hard copies and microfilm copies)
received by Investor Services Group from the Fund;
(c) the reasonable reliance on, or the implementation of, any Written
or Oral Instructions or any other instructions or requests of the Fund on
behalf of the applicable Portfolio;
(d) the offer or sales of Shares in violation of any requirement
under the U.S. securities laws; and
(e) the Fund's refusal or failure to comply with the terms of this
Agreement, or any Claim which arises out of the Fund's negligence or
willful misconduct or the material breach of any representation or warranty
of the Fund made herein.
10.2 The Fund agrees and acknowledges that Investor Services Group has not
prior to the date hereof assumed, and will not assume, any obligations or
liabilities arising out of the conduct by the Company prior to the date hereof
of those duties which Investor Services Group has agreed to perform pursuant to
this Agreement. The Fund further agrees to indemnify Investor Services Group
against any losses, claims, damages or liabilities to which Investor Services
Group may become subject in connection with the conduct by the Fund or its agent
of such duties prior to the date hereof.
10.3 Investor Services Group shall indemnify and hold the Fund and each of
the Portfolios harmless from and against any and all Claims arising out of or
attributable to Investor Services Group's refusal or failure to comply with the
terms of this Agreement, or Investor Services Group's lack of good faith,
negligence or willful misconduct, or the breach of any representation or
warranty of Investor Services Group hereunder.
10.4 In any case in which one party (the "Indemnifying Party") may be asked
to indemnify or hold the other party (the "Indemnified Party") harmless, the
Indemnified Party will notify the Indemnifying Party promptly after identifying
any situation which it believes presents or appears likely to present a claim
for indemnification against the Indemnifying Party although the failure to do so
shall not prevent recovery by the Indemnified Party and shall keep the
Indemnifying Party advised with respect to all developments concerning such
situation. The Indemnifying Party shall have the option to defend the
Indemnified Party against any Claim which may be the subject of this
indemnification, and, in the event that the Indemnifying Party
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so elects, such defense shall be conducted by counsel chosen by the Indemnifying
Party and satisfactory to the Indemnified Party, and thereupon the Indemnifying
Party shall take over complete defense of the Claim and the Indemnified Party
shall sustain no further legal or other expenses in respect of such Claim. The
Indemnified Party will not confess any Claim or make any compromise in any case
in which the Indemnifying Party will be asked to provide indemnification, except
with the Indemnifying Party's prior written consent. The obligations of the
parties hereto under this Article 10 shall survive the termination of this
Agreement.
10.4 Any claim for indemnification under this Agreement must be made prior
to the earlier of:
(a) one year after the Indemnified Party becomes aware of the event
for which indemnification is claimed; or
(b) one year after the earlier of the termination of this Agreement
or the expiration of the term of this Agreement.
10.5 Except for remedies that cannot be waived as a matter of law (and
injunctive or provisional relief), the provisions of this Article 10 shall be
the Indemnified Party's sole and exclusive remedy for claims or other actions or
proceedings to which the Indemnifying Party's indemnification obligations
pursuant to this Article 10 may apply.
Article 11 STANDARD OF CARE.
11.1 Investor Services Group shall at all times act in good faith and with
the degree of care, diligence and skill that a reasonably prudent person would
exercise in comparable circumstances and agrees to use its best efforts within
commercially reasonable limits to ensure the accuracy of all services performed
under this Agreement, but assumes no responsibility for loss or damage to the
Fund unless such loss or damage is caused by Investor Services Group's own
negligence, bad faith or willful misconduct or that of its employees.
11.2 Notwithstanding any provision in this Agreement to the contrary,
Investor Services Group's cumulative liability (to the Fund) for all losses,
claims, suits, controversies, breaches, or damages for any cause whatsoever
(including but not limited to those arising out of or related to this Agreement)
and regardless of the form of action or legal theory shall not the fees received
by Investor Services Group for services provided under this Agreement during the
Initial Term (as defined in Section 13.1); provided, however, that such
limitation on liability shall not apply to losses which result from the gross
negligence of Investor Services Group.
11.3 Each party shall have the duty to mitigate damages for which the other
party may become responsible.
Article 12 CONSEQUENTIAL DAMAGES.
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NOTWITHSTANDING ANYTHING IN THIS AGREEMENT TO THE CONTRARY, IN NO EVENT
SHALL ANY PARTY TO THIS AGREEMENT OR THEIR AFFILIATES OR ANY OF ITS OR THEIR
DIRECTORSTRUSTEES, DIRECTORS, OFFICERS, EMPLOYEES, AGENTS OR SUBCONTRACTORS BE
LIABLE FOR CONSEQUENTIAL DAMAGES UNDER ANY PROVISION OF THIS AGREEMENT OR FOR
ANY CONSEQUENTIAL DAMAGES ARISING OUT OF ANY ACT OR FAILURE TO ACT HEREUNDER.
Article 13 TERM AND TERMINATION.
13.1 This Agreement shall be effective on the date first written above and
shall continue for a period of three (3) years (the "Initial Term").
13.2 Upon the expiration of the Initial Term, this Agreement shall
automatically renew for successive terms of three (3) years ("Renewal Terms")
each, unless the Fund or Investor Services Group provides written notice to the
other of its intent not to renew. Such notice must be received not less than
ninety (90) days and not more than one-hundred eighty (180) days prior to the
expiration of the Initial Term or the then current Renewal Term.
13.3 In the event a termination notice is given by the Fund, all expenses
associated with movement of records and materials and conversion thereof to a
successor transfer agent will be borne by the Fund.
13.4 If a party hereto is guilty of a material failure to perform its
duties and obligations hereunder (a "Defaulting Party") the other party (the
"Non-Defaulting Party") may give written notice thereof to the Defaulting Party,
and if such material breach shall not have been remedied within thirty (30) days
after such written notice is given, then the Non-Defaulting Party may terminate
this Agreement by giving thirty (30) days written notice of such termination to
the Defaulting Party. If Investor Services Group is the Non-Defaulting Party,
its termination of this Agreement shall not constitute a waiver of any other
rights or remedies of Investor Services Group with respect to services performed
prior to such termination of rights of Investor Services Group to be reimbursed
for out-of-pocket expenses. In all cases, termination by the Non-Defaulting
Party shall not constitute a waiver by the Non-Defaulting Party of any other
rights it might have under this Agreement or otherwise against the Defaulting
Party.
13.5 Notwithstanding anything contained in this Agreement to the contrary,
should the Fund desire to move any of the services provided by Investor Services
Group hereunder to a successor service provider prior to the expiration of the
then current Initial or Renewal Term, or should the Fund or any of its
affiliates take any action which would result in Investor Services Group ceasing
to provide transfer agency services to the Fund prior to the expiration of the
Initial or any Renewal Term, Investor Services Group shall use its best efforts
to facilitate the conversion on such prior date. In connection with the
foregoing, should services be converted to a successor service provider or
should the Fund or any of its affiliates take any action which would result in
Investor Services Group ceasing to provide transfer agency services to the Fund
prior to the expiration of the Initial or any Renewal Term, the payment of fees
to Investor
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Services Group as set forth herein shall be accelerated to a date prior to the
conversion or termination of services and calculated as if the services had
remained with Investor Services Group until the expiration of the then current
Initial or Renewal 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
Investor Services Group.
Article 14 ADDITIONAL PORTFOLIOS
14.1 In the event that the Fund establishes one or more Portfolios in
addition to those identified in Schedule A, with respect to which the Fund
desires to have Investor Services Group render services as transfer agent under
the terms hereof, the Fund shall so notify Investor Services Group in writing,
and if Investor Services Group agrees in writing to provide such services,
Exhibit 1 shall be amended to include such additional Portfolios.
Article 15 CONFIDENTIALITY.
15.1 The parties agree that the Proprietary Information (defined below) and
the contents of this Agreement (collectively "Confidential Information") are
confidential information of the parties and their respective licensors. The
Fund and Investor Services Group shall exercise at least the same degree of
care, but not less than reasonable care, to safeguard the confidentiality of the
Confidential Information of the other as it would exercise to protect its own
confidential information of a similar nature. The Fund and Investor Services
Group shall not duplicate, sell or disclose to others the Confidential
Information of the other, in whole or in part, without the prior written
permission of the other party.
15.2 Proprietary Information means:
(a) any data or information that is competitively sensitive material,
and not generally known to the public, including, but not limited to,
information about product plans, marketing strategies, finance, operations,
customer relationships, customer profiles, sales estimates, business plans,
and internal performance results relating to the past, present or future
business activities of the Fund or Investor Services Group, their
respective subsidiaries and affiliated companies and the customers, clients
and suppliers of any of them;
(b) any scientific or technical information, design, process,
procedure, formula, or improvement that is commercially valuable and secret
in the sense that its confidentiality affords the Fund or Investor Services
Group a competitive advantage over its competitors; and
(c) all confidential or proprietary concepts, documentation, reports,
data, specifications, computer software, source code, object code, flow
charts, databases, inventions, know-how, show-how and trade secrets,
whether or not patentable or copyrightable.
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15.3 Confidential Information includes, without limitation, all documents,
inventions, substances, engineering and laboratory notebooks, drawings,
diagrams, specifications, bills of material, equipment, prototypes and models,
and any other tangible manifestation of the foregoing of either party which now
exist or come into the control or possession of the other.
15.4 The obligations of confidentiality and restriction on use herein shall
not apply to any Confidential Information that a party proves:
(a) Was in the public domain prior to the date of this Agreement or
subsequently came into the public domain through no fault of such party; or
(b) Was lawfully received by the party from a third party free of any
obligation of confidence to such third party; or
(c) Was already in the possession of the party prior to receipt
thereof, directly or indirectly, from the other party; or
(d) Is required to be disclosed in a judicial or administrative
proceeding after all reasonable legal remedies for maintaining such
information in confidence have been exhausted including, but not limited
to, giving the other party as much advance notice of the possibility of
such disclosure as practical so the other party may attempt to stop such
disclosure or obtain a protective order concerning such disclosure; or
(f) Is subsequently and independently developed by employees,
consultants or agents of the party without reference to the Confidential
Information disclosed under this Agreement.
Article 16 FORCE MAJEURE.
No party shall be liable for any default or delay in the performance of its
obligations under this Agreement if and to the extent such default or delay is
caused, directly or indirectly, by (i) fire, flood, elements of nature or other
acts of God; (ii) any outbreak or escalation of hostilities, war, riots or civil
disorders in any country, (iii) any act of any governmental authority; (iv) any
labor disputes (whether or not the employees' demands are reasonable or within
the party's power to satisfy); or (v) nonperformance by a third party or any
similar cause beyond the reasonable control of such party, including without
limitation, failures or fluctuations in telecommunications or other equipment.
In any such event, the non-performing party shall be excused from any further
performance and observance of the obligations so affected only for as long as
such circumstances prevail and such party continues to use commercially
reasonable efforts to recommence performance or observance as soon as
practicable.
Article 17 ASSIGNMENT AND SUBCONTRACTING.
This Agreement, its benefits and obligations shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
permitted assigns. This
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Agreement may not be assigned or otherwise transferred by either party hereto,
without the prior written consent of the other party, which consent shall not be
unreasonably withheld; provided, however, that Investor Services Group may, in
its sole discretion, assign all its right, title and interest in this Agreement
to an affiliate, parent or subsidiary, or to the purchaser of substantially all
of its business. Investor Services Group may, in its sole discretion, engage
subcontractors to perform any of the obligations contained in this Agreement to
be performed by Investor Services Group.
Article 18 NOTICE.
Any notice or other instrument authorized or required by this Agreement to
be given in writing to the Fund or Investor Services Group, 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:
PPM America Funds
000 Xxxx Xxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxx X. Xxxxxxx
To Investor Services Group:
First Data Investor Services Group, Inc.
0000 Xxxxxxxx Xxxxx
Xxxxxxxx, Xxxxxxxxxxxxx 00000
Attention: President
with a copy to Investor Services Group's General Counsel
Article 19 GOVERNING LAW/VENUE.
The laws of the Commonwealth of Massachusetts, excluding the laws on
conflicts of laws, shall govern the interpretation, validity, and enforcement of
this agreement. All actions arising from or related to this Agreement shall be
brought in the state and federal courts sitting in the City of Boston, and
Investor Services Group and the Fund hereby submit themselves to the
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exclusive jurisdiction of those courts.
Article 20 COUNTERPARTS.
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.
Article 21 CAPTIONS.
The captions of this Agreement are included for convenience of reference
only and in no way define or limit any of the provisions hereof or otherwise
affect their construction or effect.
Article 22 PUBLICITY.
Neither Investor Services Group nor the Fund shall release or publish news
releases, public announcements, advertising or other publicity relating to this
Agreement or to the transactions contemplated by it without the prior review and
written approval of the other party; provided, however, that either party may
make such disclosures as are required by legal, accounting or regulatory
requirements after making reasonable efforts in the circumstances to consult in
advance with the other party.
Article 23 RELATIONSHIP OF PARTIES/NON-SOLICITATION.
23.1 The parties agree that they are independent contractors and not
partners or co-venturers and nothing contained herein shall be interpreted or
construed otherwise.
23.2 During the term of this Agreement and for one (1) year afterward, the
Fund shall not recruit, solicit, employ or engage, for the Fund or others,
Investor Services Group's employees.
Article 24 ENTIRE AGREEMENT; SEVERABILITY.
24.1 This Agreement, including Schedules, Addenda, and Exhibits hereto,
constitutes the entire Agreement between the parties with respect to the subject
matter hereof and supersedes all prior and contemporaneous proposals,
agreements, contracts, representations, and understandings, whether written or
oral, between the parties with respect to the subject matter hereof. No change,
termination, modification, or waiver of any term or condition of the Agreement
shall be valid unless in writing signed by each party. No such writing shall be
effective as against Investor Services Group unless said writing is executed by
a Senior Vice President, Executive Vice President, or President of Investor
Services Group. A party's waiver of a breach of any term or condition in the
Agreement shall not be deemed a waiver of any subsequent breach of the same or
another term or condition.
24.2 The parties intend every provision of this Agreement to be severable.
If a court of competent jurisdiction determines that any term or provision is
illegal or invalid for any reason,
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the illegality or invalidity shall not affect the validity of the remainder of
this Agreement. In such case, the parties shall in good faith modify or
substitute such provision consistent with the original intent of the parties.
Without limiting the generality of this paragraph, if a court determines that
any remedy stated in this Agreement has failed of its essential purpose, then
all other provisions of this Agreement, including the limitations on liability
and exclusion of damages, shall remain fully effective.
Article 25 MISCELLANEOUS.
The Fund and Investor Services Group agree that the obligations of the Fund
under the Agreement shall not be binding upon any of the Board Members,
shareholders, nominees, officers, employees or agents, whether past, present or
future, of the Fund individually, but are binding only upon the assets and
property of the Fund, as provided in the Articles of Incorporation. The
execution and delivery of this Agreement have been authorized by the Board
Members of the Fund, and signed by an authorized officer of the Fund, acting as
such, and neither such authorization by such Board Members nor such execution
and delivery by such officer shall be deemed to have been made by any of them or
any shareholder of the Fund individually or to impose any liability on any of
them or any shareholder of the Fund personally, but shall bind only the assets
and property of the Fund as provided in the Articles of Incorporation.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized officers, as of the day and year first above
written.
PPM AMERICA FUNDS
By: /s/ Xxxx X. Xxxxxxx
------------------------------------------
Title: CFO
---------------------------------------
FIRST DATA INVESTOR SERVICES GROUP, INC.
By: /s/ Xxxxxxx Xxxxx
------------------------------------------
Title: Senior V.P.
---------------------------------------
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SCHEDULE A
LIST OF PORTFOLIOS
PPM America Value Equity Fund
PPM America Small Cap Value Equity Fund
PPM America High Yield Bond Fund
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SCHEDULE B
DUTIES OF INVESTOR SERVICES GROUP
I. TRANSFER AGENCY SERVICES
(a) SHAREHOLDER INFORMATION. Investor Services Group shall maintain a
record of the number of Shares held by each Shareholder of record which shall
include name, address, taxpayer identification.
(b) SHAREHOLDER SERVICES. Investor Services Group shall respond as
appropriate to all inquiries and communications from Shareholders relating to
Shareholder accounts with respect to its duties hereunder and as may be from
time to time mutually agreed upon between Investor Services Group and the Fund.
*
*
*
(c) MAILING COMMUNICATIONS TO SHAREHOLDERS; PROXY MATERIALS. Investor
Services Group 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,
Investor Services Group will prepare Shareholder lists, mail and certify as to
the mailing of proxy materials, process and tabulate returned proxy cards,
report on proxies voted prior to meetings, act as inspector of election at
meetings and certify Shares voted at meetings.
(d) SALES OF SHARES.
* Investor Services Group shall receive for acceptance orders for the
purchase of Shares, and promptly deliver payment and appropriate
documentation thereof to the Custodian and pursuant to purchase orders,
issue the appropriate number of Shares and hold such Shares in the
appropriate shareholder account.
* Investor Services Group shall not be required to issue any Shares of
the Fund where it has received a Written Instruction from the Fund or
official notice from any appropriate authority that the sale of the Shares
of the Fund has been suspended or discontinued. The existence of such
Written Instructions or such official notice shall be conclusive evidence
of the right of Investor Services Group to rely on such Written
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Instructions or official notice.
* In the event that any check or other order for the payment of money
is returned unpaid for any reason, Investor Services Group will endeavor
to: (i) give prompt notice of such return to the Fund or its designee;
(ii) place a stop transfer order against all Shares issued as a result of
such check or order; and (iii) take such actions as Investor Services Group
may from time to time deem appropriate.
(e) TRANSFER AND REPURCHASE.
* Investor Services Group shall process all requests to transfer or
redeem Shares in accordance with the transfer or repurchase procedures set
forth in the Fund's Prospectus.
* Investor Services Group will transfer or repurchase Shares upon
receipt of Oral or Written Instructions or otherwise pursuant to the
Prospectus.
* Investor Services Group reserves the right to refuse to transfer or
repurchase Shares until it is satisfied that the endorsement on the
instructions is valid and genuine. Investor Services Group also reserves
the right to refuse to transfer or repurchase Shares until it is satisfied
that the requested transfer or repurchase is legally authorized, and it
shall incur no liability for the refusal, in good faith, to make transfers
or repurchases which Investor Services Group, in its good faith judgment,
deems improper or unauthorized, or until it is reasonably satisfied that
there is no basis to any claims adverse to such transfer or repurchase.
* When Shares are redeemed, Investor Services Group shall, upon receipt
of the instructions and documents in proper form, deliver to the Custodian
and the Fund or its designee a notification setting forth the number of
Shares to be repurchased. Such repurchased shares shall be reflected on
appropriate accounts maintained by Investor Services Group reflecting
outstanding Shares of the Fund and Shares attributed to individual
accounts.
* Investor Services Group shall upon receipt of the monies provided to
it by the Custodian for the repurchase of Shares, pay such monies as are
received from the Custodian, all in accordance with the procedures
described in the written instruction received by Investor Services Group
from the Fund.
* Investor Services Group shall not process or effect any repurchase
with respect to Shares of the Fund after receipt by Investor Services Group
or its agent of notification of the suspension of the determination of the
net asset value of the Fund.
(f) DIVIDENDS.
* Prepare and transmit payments for dividends and distributions declared
by the Fund on behalf of each Portfolio.
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* Upon the declaration of each dividend and each capital gains
distribution by the Board of Trustees of the Fund with respect to Shares of
the Fund, the Fund shall furnish or cause to be furnished to Investor
Services Group Written Instructions setting forth the date of the
declaration of such dividend or distribution, the ex-dividend date, the
date of payment thereof, the record date as of which Shareholders entitled
to payment shall be determined, the amount payable per Share to the
Shareholders of record as of that date, the total amount payable on the
payment date and whether such dividend or distribution is to be paid in
Shares at net asset value.
* On or before the payment date specified in such resolution of the
Board of Trustees, the Fund will provide Investor Services Group with
sufficient cash to make payment to the Shareholders of record as of such
payment date.
* If Investor Services Group does not receive sufficient cash from the
Fund to make total dividend and/or distribution payments to all
Shareholders of the Fund as of the record date, Investor Services Group
will, upon notifying the Fund, withhold payment to all Shareholders of
record as of the record date until sufficient cash is provided to Investor
Services Group.
(g) CASH MANAGEMENT SERVICES. Funds received by Investor Services Group
in the course of performing its services hereunder will be held in bank or
money market fund accounts in the name of Investor Services Group as agent
for the benefit of its clients. Such accounts may include funds held by
Investor Services Group as agent for the benefit of clients other than the
Fund. Investor Services Group shall be entitled to retain any interest,
dividends, balance credits or fee reductions or other concessions or benefits
earned or generated by or associated with such accounts or made available by
the institution with which such accounts are maintained.
(h) LOST SHAREHOLDERS. Investor Services Group shall perform such
services as are required in order to comply with Rules 17a-24 and 17Ad-17 of the
34 Act (the Lost Shareholder Rules"), including, but not limited to those set
forth below. Investor Services Group may, in its sole discretion, use the
services of a third party to perform the some or all such services.
- documentation of electronic search policies and procedures;
- execution of required searches;
- creation and mailing of confirmation letters;
- taking receipt of returned verification forms;
- providing confirmed address corrections in batch via electronic media;;
- tracking results and maintaining data sufficient to comply with the Lost
Shareholder Rules; and
- preparation and submission of data required under the Lost Shareholder
Rules.
(i) MISCELLANEOUS. In addition to and neither in lieu nor in
contravention of the services set forth above, Investor Services Group shall:
(i) perform all the customary services of
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a transfer agent, registrar, dividend disbursing agent and agent of the dividend
reinvestment and cash purchase plan as described herein consistent with those
requirements in effect as at the date of this Agreement. The detailed
definition, frequency, limitations and associated costs (if any) set out in the
attached fee schedule, include but are not limited to: maintaining all
Shareholder accounts, preparing Shareholder meeting lists, mailing proxies,
tabulating proxies, mailing Shareholder reports to current Shareholders,
withholding taxes on U.S. resident and non-resident alien accounts where
applicable, preparing and filing U.S. Treasury Department Forms 1099 and other
appropriate forms required with respect to dividends and distributions by
federal authorities for all Shareholders.
II. BLUE SKY SERVICES
Performing "Blue Sky" compliance functions, as follows:
* Effecting and maintaining, as the case may be, the Fund's notification
filing for sale under the securities laws of the jurisdictions listed in
the Written Instructions of the Fund, which instructions will include the
amount of Shares to be registered as well as the warning threshold to be
maintained. Any Written Instructions not received at least 45 days prior
to the date the Fund intends to offer or sell its Shares cannot be
guaranteed a timely notification to the states. In addition, Investor
Services Group shall not be responsible for providing to any other service
provider of the Fund a list of the states in which the Fund may offer and
sell its Shares.
* Providing to the Fund quarterly reports of sales activity in each
jurisdiction in accordance with the Written Instructions of the Fund.
Sales will be reported by shareholder residence. NSCC trades and order
clearance will be reported by the state provided by the dealer at the point
of sale. Trades by omnibus accounts will be reported by trustee state of
residence in accordance with the Written Instructions of the Fund outlining
the entities which are permitted to maintain omnibus positions with the
Fund.
* In the event sales of Shares in a particular jurisdiction reach or
exceed the warning levels provided in the Written Instructions of the Fund,
Investor Services Group will promptly notify the Fund with a recommendation
of the amount of Shares to be registered in such jurisdiction and the fee
for such registration. Investor Services Group will not register
additional Shares in such jurisdiction unless and until Investor Services
Group shall have received written instructions from the Fund to do so.
* If Investor Services Group is instructed by the Fund not to file a
notification filing in a particular jurisdiction, Investor Services Group
will use its best efforts to cause any sales in such jurisdictions to be
blocked, and such sales will not be reported to Investor Services Group as
sales of Shares of the Fund.
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SCHEDULE C
FEE SCHEDULE
1. Transfer Agency Fees
(a) Standard Fees (1/12th payable monthly):
$20.00 per account per year per Portfolio
$24,000 annual minimum fee per Portfolio (reduced to $20,000 for the
first two years from the
Commencement Date)
(b) IRA's, 403(b) Plans, Defined Contribution/Benefit Plans:
Annual Maintenance Fee - $12.00 per account per year
(c) Fund/Serv Processing (if applicable):
$1,000 - one time set-up charge - new Portfolio
$50.00 - per month/per Portfolio monthly maintenance fee
(d) Networking Processing (if applicable):
$1,000 - one time set-up charge - new Portfolio
$75.00 - per month/per Portfolio monthly maintenance fee
2. Blue Sky Fees:
$200.00 per permit per year
$5,000 annual minimum fee (assuming three initial Portfolios)
To the extent that the Fund decides to issue multiple/separate classes of
Shares, additional fees will apply.
3. PROGRAMMING COSTS (FOR SPECIAL PROGRAMMING REQUESTS, IF APPLICABLE)
(a) Dedicated Team:
Programmer $100,000 per annum
BSA $ 85,000 per annum
Tester $ 65,000 per annum
(b) System Enhancements (Non Dedicated Team):
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Programmer $135.00 per hour
The above rates for this Item 3 are subject to an annual 5% increase after the
one year anniversary of the effective date of this Agreement.
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SCHEDULE D
OUT-OF-POCKET EXPENSES
The Fund shall reimburse Investor Services Group monthly for applicable
out-of-pocket expenses, including, but not limited to the following items:
* Microfiche/microfilm production
* Magnetic media tapes and freight
* Printing costs, including certificates, envelopes, checks and
stationery
* Postage (bulk, pre-sort, ZIP+4, barcoding, first class) direct pass
through to the Fund
* Due diligence mailings
* Telephone and telecommunication costs, including all lease,
maintenance and line costs
* Ad hoc reports
* Proxy solicitations, mailings and tabulations
* Daily & Distribution advice mailings
* Shipping, Certified and Overnight mail and insurance
* Year-end form production and mailings
* Terminals, communication lines, printers and other equipment and any
expenses incurred in connection with such terminals and lines
* Duplicating services
* Courier services
* Incoming and outgoing wire charges
* Federal Reserve charges for check clearance
* Overtime, as approved by the Fund
* Temporary staff, as approved by the Fund
* Travel to and from Board meetings
* Record retention, retrieval and destruction costs, including, but not
limited to exit fees charged by third party record keeping vendors
* Third party audit reviews
* Ad hoc SQL time
* Insurance
* NAV)
* NAV)
* Forms and supplies for the preparation of Board meetings and other
materials for the Fund
* Vendor set-up charges for Blue Sky services
* Vendor set-up charges for Blue Sky services
* Customized programming requests
* Blue Sky filing or registration fees
* SAS 70
* Cold Storage
* Document Retrieval
* comparison
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* Manual pricing
* comparison
* Manual pricing
* Such other miscellaneous expenses reasonably incurred by Investor
Services Group in performing its duties and responsibilities under
this Agreement.
The Fund agrees that postage and mailing expenses will be paid on the day
of or prior to mailing as agreed with Investor Services Group. In addition, the
Fund will promptly reimburse Investor Services Group for any other unscheduled
expenses incurred by Investor Services Group whenever the Fund and Investor
Services Group mutually agree that such expenses are not otherwise properly
borne by Investor Services Group as part of its duties and obligations under the
Agreement.
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SCHEDULE E
FUND DOCUMENTS
* Certified copy of the Articles of Incorporation of the Fund, as
amended
* Certified copy of the By-laws of the Fund, as amended
* Copy of the resolution of the Board of Trustees authorizing the
execution and delivery of this Agreement
*
*
* All account application forms and other documents relating to
Shareholder accounts or to any plan, program or service offered by the
Fund
* Certified list of Shareholders of the Fund with the name, address
and taxpayer identification number of each Shareholder, and the number
of Shares of the Fund held by each, certificate numbers and
denominations (if any certificates have been issued), lists of any
accounts against which stop transfer orders have been placed, together
with the reasons therefore, and the number of Shares redeemed by the
Fund
* All notices issued by the Fund with respect to the Shares in
accordance with and pursuant to the Articles of Incorporation or
By-laws of the Fund or as required by law and shall perform such other
specific duties as are set forth in the Articles of Incorporation
including the giving of notice of any special or annual meetings of
shareholders and any other notices required thereby.
* All information relative to the monitoring of sales and
registrations of Fund shares in such jurisdictions
* The Fund's most recent post-effective amendment to its
Registration Statement
* The Fund's most recent prospectus and statement of additional
information, if applicable, and all amendments and supplements thereto
