TRUST NETWORKING AGREEMENT
AGREEMENT entered into by and between Touchstone Securities, Inc., ("Fund
Agent") with its principal place of business in Cincinnati, Ohio and
_____________________________, ("Trust Entity") with its principal place of
business in _______________________________________. As used in this Agreement,
the following terms shall have the following meanings, unless a different
meaning is clearly required by the contexts:
Funds shall mean, as applicable, (i) the Fund Agent, or (ii) the open-end
investment companies for which the Fund Agent serves as investment adviser,
administrator, principal underwriter, distributor and/or transfer agent.
Client-shareholders shall mean those clients of the Trust Entity who maintain an
interest in an account with the Funds registered in the name of the Trust Entity
and who receive administrative services from the Trust Entity.
Trust Entity shall mean (i) a Trust Company, (ii) a Trust Department of a
Commercial Bank, or (iii) an entity performing services for a trust who acts in
a fiduciary capacity on behalf of the Client-shareholders.
Fund Agent is either (i) an investment adviser to or administrator for the
Funds, or (ii) the principal underwriter or distributor for the Funds, (iii) the
transfer agent for the Funds.
WHEREAS, the Trust Entity, possessing the authority to act on behalf of its
client-shareholders of the Funds ("Client-shareholders");
WHEREAS, the Trust Entity and either the Funds or the Funds' principal
underwriter or other agent ("Underwriter") are members of the National
Securities Clearing Corporation ("NSCC") or otherwise have access to the NSCC's
NETWORKING system ("NETWORKING") through a registered clearing agency;
WHEREAS, NETWORKING permits the transmission of Client-shareholder data between
the Trust Entity and the Fund Agent pursuant to Trust Level processing
established by the NSCC;
WHEREAS, the Fund Agent and the Trust Entity desire to participate in NETWORKING
with each other pursuant to Trust Level processing;
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WHEREAS, this Agreement shall inure to the benefit of and shall be binding upon
the undersigned and each such entity shall be either a Fund Agent or Trust
Entity for purposes of this Agreement (the Fund Agent and the Trust Entity shall
be collectively referred to herein as the "Parties" and individually as a
"Party");
NOW, THEREFORE, in consideration of the mutual covenants herein contained, which
consideration is full and complete, the Fund Agent and the Trust Entity hereby
agree as follows:
I. OBLIGATIONS OF THE FUND AGENT
1. Transactions Subject to NETWORKING. For each Client-Shareholder account
opened or maintained pursuant to NETWORKING ("NETWORKING Accounts"), the Fund
Agent shall accept, and effect changes in its records upon receipt,
instructions, communications and actions from the Trust Entity electronically
through NETWORKING without supporting documentation from the Client-shareholder.
The Fund Agent shall be responsible for processing any such instructions,
communications or actions from the Trust Entity and for executing the Trust
Entity's instructions in a timely manner according to the NSCC rules and
procedures for Trust Level Processing.
2. Performance of Duties. The Fund Agent shall perform any and all duties,
functions, procedures and responsibilities assigned to it pursuant to Trust
Level Processing and as otherwise established by the NSCC. The Fund Agent shall
maintain facilities, equipment and skilled personnel sufficient to perform the
foregoing activities and to otherwise comply with the terms of this Agreement.
The Fund Agent shall conduct each of the foregoing activities in a competent
manner and in compliance with (a) all applicable laws, rules and regulations,
including NSCC rules and procedures relating to NETWORKING; (b) the then-current
prospectuses and statements of additional information of the Funds; and (c) any
provision relating to NETWORKING in any agreement between the Trust Entity and
the Underwriter that would affect the Fund Agent's duties and obligations
pursuant to the Agreement.
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3. Accuracy of Information, Transmissions Through, and Access to NETWORKING. Any
information provided by the Fund Agent to the Trust Entity through NETWORKING
and pursuant to this Agreement shall be accurate, complete, and in the format
prescribed by the NSCC. The Fund Agent shall adopt, implement and maintain
procedures reasonably designed to ensure the accuracy of all transmissions
through NETWORKING and to limit the access to, and the inputting of data into,
NETWORKING to persons specifically authorized by the Fund Agent.
4. Tax Statements. The Fund Agent shall provide to the Trust Entity in a timely
manner the information regarding the Funds to be included in Client-shareholder
tax statements for the period during which NETWORKING Account was maintained
under Trust Level Processing at any time during a taxable year.
5. Notice of Prospectus and Statement of Additional Information Revisions. The
Fund Agent shall provide the Trust Entity with reasonable notice of any material
revisions to the Funds' prospectuses and statements of additional information as
are necessary to enable the Trust Entity to fulfill its obligations under this
Agreement.
II. OBLIGATIONS OF THE TRUST ENTITY
1. Performance of Duties. The Trust Entity shall perform any and all duties,
functions, procedures and responsibilities assigned to it under this agreement
and as otherwise established by the NSCC. The Trust Entity shall maintain
facilities, equipment and skilled personnel sufficient to perform the foregoing
activities and to otherwise comply with the terms of this Agreement. The Trust
Entity shall conduct each of the forgoing activities in a competent manner and
in compliance with (a) all applicable laws, rules and regulations, including
NSCC rules and procedures relating to NETWORKING -- Trust Level Processing, and
(b) the then current prospectuses and statements of additional information of
the Funds
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2. Accuracy of Information, Transmissions Through, and Access to NETWORKING. Any
information provided by the Trust Entity to the Fund Agent through NETWORKING
and pursuant to this Agreement shall be accurate, complete and, in the format
prescribed by the NSCC. All instructions, communications and actions by the
Trust Entity regarding each NETWORKING Account shall be true and correct and
will have been duly authorized by the Client-shareholder. The Trust Entity shall
adopt, implement and maintain procedures reasonably designed to ensure the
accuracy of all transmissions through NETWORKING and to limit the access to, and
the inputting of data into, NETWORKING to persons specifically authorized by the
Trust Entity.
3. Information Relating to NETWORKING Accounts. For each NETWORKING Account, the
Trust Entity shall provide the Funds and the Fund Agent with all information
necessary or appropriate to establish and maintain each NETWORKING Account (and
any subsequent changes to such information) which the Trust Entity hereby
certifies, to the best of the knowledge of the Trust Entity is and shall remain
true and correct. The Trust Entity shall comply in all respects with any and all
applicable obligations relating to withholding pursuant to the Internal Revenue
Code of 1986, as amended ("Code") and shall promptly advise the Funds or the
Fund Agent of any matter that may affect the responsibilities of the Funds or
the Fund Agent to Client-shareholders pursuant to the Code. The Trust Entity
shall maintain documents required by the Funds or by applicable law, rules and
regulations to verify the relevant information regarding each NETWORKING
Account.
4. Shareholder Instructions Regarding NETWORKING Accounts. Unless otherwise
prohibited by law, upon receipt of appropriate instructions from a
Client-Shareholder, the Trust Entity shall promptly execute the
Client-shareholder's instructions to terminate the maintenance of the
Client-shareholder's account through Trust Level NETWORKING.
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5. Shareholder Reports and Other Documents; Solicitation of Proxies. The Trust
Entity shall timely deliver to each Client-shareholder all reports and other
documents provided to it by the Funds or the Fund Agent as is required by
applicable law and the Trust Entity Agreement with the Client-shareholder,
provided that the Trust Entity has timely received sufficient copies of such
reports and/or documents. Subject to receipt by the Fund Agent of such
supporting documentation as it may reasonably request, the Fund Agent shall
reimburse the Trust Entity for all reasonable out-of-pocket expenses incurred by
the Trust Entity in mailing all such reports and/or documents. The Fund Agent
and the Trust Entity shall cooperate with each other in the solicitation and
voting of proxies on behalf of the Funds according to the Trust Entity's
fiduciary responsibility as written in the trust agreement or as required by
state law or federal regulation.
6. Statement Generation. Any information provided by the Fund Agent to the Trust
Entity electronically through NETWORKING and pursuant to this Agreement, shall
satisfy the delivery obligations as outlined by SEC Rule 10b-10 and, as such,
the Fund Agent has the informed consent of the Trust Entity to suppress the
delivery of this information using paper-media. In the event the
Client-Shareholder has requested an interested party statement, paper-media may
be required for the interested party.
7. Tax Statements. All information that is received by the Trust Entity from the
Funds or the Fund Agent for inclusion in Client-shareholder tax statements
relating to the period during which a NETWORKING Account was maintained under
Trust Level processing in a taxable year shall be reported to the
Client-shareholder accurately, completely and in a timely manner according to
the Trust Entity's fiduciary responsibility as written in the trust agreement or
as required by state law or federal regulation.
8. Cash Dividends. For each NETWORKING Account maintained under Trust Level
Processing in which cash dividends are received by the Trust Entity from the
Funds or the Fund Agent for payment to Client-shareholders, the Trust Entity
shall be solely responsible for ensuring that all cash dividends received by the
Trust Entity are paid to Client-shareholders in a timely manner.
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III. INDEMNIFICATION
1. Fund Agent. The Fund Agent shall indemnify and hold harmless the Trust
Entity, and each of the Trust Entity's divisions, subsidiaries, affiliates,
directors, officers, agents, employees and assigns of each of the foregoing
(collectively, "Indemnified Trust Entity Parties"), against and from any and all
demands, damages, liabilities, and losses, or any pending or completed actions,
claims, suits, complaints, proceedings, or investigations (including reasonable
attorneys fees and other costs, including all expenses of litigation or
arbitration, judgments, fines or amounts paid in any settlement consented to by
the Fund Agent) to which any of them may be or become subject to as a result or
arising out of (a) any negligent act or omission by the Fund Agent or its Agents
relating to NETWORKING provided that the Trust Entity has not acted negligently;
(b) any breach of the Fund Agent's representations or warranties contained in
this Agreement; (c) the Fund Agent's failure to comply with any of the terms of
this Agreement; or (d) the Trust Entity's acceptance of any transaction or
account maintenance information from the Fund Agent through NETWORKING.
2. Trust Entity. The Trust entity shall indemnify and hold harmless the Funds,
the Funds' custodian, the Funds' underwriter, the Funds' distributor, the Funds'
investment advisor, the Fund Agent, the Funds' transfer agent/shareholder
servicing agent, each of their affiliated companies, and all of the divisions,
subsidiaries, directors, trustees, officers, agents, employees and assigns of
each of the foregoing (collectively, "Indemnified Fund Parties"), against and
from any and all demands, damages, liabilities, and losses, or any pending or
completed actions, claims, suits, complaints, proceedings, or investigations
(including reasonable attorneys fees and other costs, including all expenses of
litigation or arbitration, judgments, fines or amounts paid in any settlement
consented to by the Trust Entity) to which any of them may be or become subject
to as a result or arising out of (a) any negligent at or omission by the Trust
Entity, the Trust's correspondents, or their agents relating to NETWORKING;
provided the Fund Agent has not acted negligently; (b) any breach of the Trust's
representations or warranties in this Agreement; (c) the failure of the Trust
Entity or the Trust's correspondents to comply with any of the terms of this
Agreement; or (d) the Fund Agent's acceptance of any transaction or account
maintenance information from the Trust Entity through NETWORKING.
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3. Notice and Opportunity to Defend. If any action, suit, proceeding, or
investigation is initiated, or any claim or demand is made, against any Party
indemnified hereto with respect to which such Party ("Indemnified Party") may
make a claim against any other Party hereto ("Indemnifying Party") pursuant to
this Section III, then the Indemnified Party shall give prompt written notice of
such action, suit, proceeding, investigation, claim or demand to the
Indemnifying Party. Thereafter, the Indemnifying Party shall have the
opportunity, at its own expense and with its own counsel, to defend or settle
such action, suit, proceeding , investigation, claim or demand; provided,
however, that: (a) the Indemnifying Party shall keep the Indemnified Party
informed of all material developments and events relating to such action, suit,
proceeding, investigation, claim or demand; (b) the Indemnified Party shall have
the right to participate, at its own expense in the defense of such action,
suit, proceeding, investigation, claim or demand and shall cooperate as
reasonably requested by the Indemnifying Party in the defense thereof; and (c)
the Indemnifying Party shall not settle such action, suit, proceeding,
investigation, claim or demand without the prior written consent of the
Indemnified Party, which consent shall not be unreasonably withheld.
IV. MISCELLANEOUS
1. Effective Date of Agreement. This Agreement shall become effective on the
date first above written.
2. NSCC Provisions. NSCC rules and procedures relating to NETWORKING shall
govern any matter in which any provision contained in this Agreement conflicts
with any such NSCC rule or procedure; provided however, this Paragraph 2 shall
not prohibit modifications to the NSCC's Trust Level Processing that are agreed
to by the Parties.
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3. Conversion to NETWORKING. If the Trust Entity, as part of its conversion to
NETWORKING, requires that outstanding certificates be deposited with any of the
Funds or that street name house accounts be divided into individual accounts,
the Trust Entity shall submit to the Fund Agent a "Conversion Plan" and shall
obtain prior written consent from the Fund Agent for the Conversion Plan. The
Conversion Plan shall detail volumes for certificates or individual accounts,
procedures for processing, documentary requirements, procedures and reasonable
time frames for resolving discrepancies, and such other matters, including the
classes of Client-shareholder accounts eligible for NETWORKING, and ongoing
procedures for the entry and removal of individual accounts to and from
NETWORKING. The Fund Agent will assist the Trust Entity in formulating the
Conversion Plan.
4. Reconciling to Fund Records. The official records of each NETWORKING Account
shall be as determined by the Fund Agent. The Trust Entity and the Fund Agent
shall reconcile any differences between the Trust Entity's records and the Fund
Agent's records. The Trust Entity and the Fund Agent shall each designate
liaison personnel to communicate, control and execute any required corrections
or reconciliations with respect to any NETWORKING Account. In the event of any
discrepancy between the records of the Trust Entity and the Fund Agent regarding
a NETWORKING Account, the records of the Fund Agent shall control pending
resolution of the discrepancy.
5. Fund Shares Held on Behalf of Trust Entity Clients. All Fund Shares held by
the Trust Entity on behalf of a Client-shareholder of the Trust Entity shall be
carried in a custody account for the exclusive benefit of Client-shareholders of
the Trust Entity and shall not be subject to any right, charge, security
interest, lien or other claim against the Trust Entity in favor of the Funds or
the Fund Agent.
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6. Overpayments to the Trust Entity. In the event any overpayment is made to the
Trust Entity by the Fund Agent, the Trust Entity shall promptly repay such
overpayment to the Fund Agent, but in no event more than fifteen (15) days after
the Trust Entity's receives notice of such overpayment. If any overpayment is
not timely repaid to the Fund Agent, the Trust Entity authorizes the Fund Agent,
the Funds, or any of their affiliates, to offset any such overpayment against
any funds otherwise payable to the Trust Entity for the Trust Entity's own
account by the Fund Agent, the Funds or their affiliates, including, without
limitation, service fees; provided, however, that an overpayment to the Trust
Entity shall not be subject to such offset if the overpayment was the result of
an error or other negligent act or omission on the part of the Funds or the Fund
Agent; and provided further, that the Trust Entity shall not be required to
repay, out of its own funds, an overpayment forwarded to a Client-shareholder
that is a client of the Trust Entity, and the Trust Entity shall instead provide
the Fund Agent with the name and address of such client, if (a) the overpayment
to the Trust Entity is not the result of an error or other negligent act or
omission on the part of the Trust Entity, and (b) such client is no longer a
Shareholder of any Fund.
7. Termination. Either the Fund Agent or the Trust Entity may terminate this
Agreement with the other Party by written notice to that Party. Commencing from
the date of receipt of such notice ("Notification Date"), the Fund Agent and the
Trust Entity shall proceed with the termination of this Agreement in accordance
with the following schedule unless otherwise agreed to by the Parties: (a) the
opening of new NETWORKING Accounts shall cease within thirty (30) days of the
Notification Date; (b) a plan which sets forth the procedures that must be
followed to effect the termination of this Agreement ("Unwinding Plan") must be
agreed upon by the Parties within sixty (60) days of the Notification Date; (c)
the Unwinding Plan must be fully implemented within ninety (90) days of the
Notification Date; and (d) the Unwinding Plan must be fully completed within one
hundred eighty (180) days of the Notification Date. The obligations of the
Parties under Section III of this Agreement shall survive any termination hereof
with respect to any transactions occurring, or circumstances arising out of any
information provided or omitted, or other actions or omissions to act, before
the effective date of any termination hereof.
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8. Conflicting Agreements. Except with respect to the provisions of this
Agreement contained in Paragraphs 3 and 11, of this Section IV, any provision of
any agreement or other understanding between the Fund Agent and the Trust Entity
relating to NETWORKING that is inconsistent with this Agreement shall be null
and void. Nothing contained in this Agreement, however, shall be construed to
limit or restrict either Party's compliance with any law, regulation or order to
which the Party is subject or to prevent the Parties from supplementing this
Agreement by agreeing to additional duties, obligations, representations,
warranties and/or higher standards of care with respect thereto.
9. Assignment. Neither the Fund Agent nor the Trust Entity may assign this
Agreement without the prior written consent of the other Party, and any
attempted assignment without such consent shall be null and void; provided,
however, a change in control of either Party shall not constitute an assignment
of this Agreement.
10. Headings; Entire Agreement. The paragraph headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement. This Agreement, including any
document explicitly incorporated herein by reference and any written
supplemental agreement between the Fund Agent and the Trust Entity, shall
contain the full understanding of the Parties with respect to the subject matter
hereof and shall supersede any other previous agreement or understanding of the
Parties relating thereto. No waiver, alteration or modification of any of the
provisions hereof shall be binding unless in writing and signed by duly
authorized representatives of the Fund Agent and the Trust Entity. Neither the
course of conduct between the Parties nor trade usage shall act to modify or
alter the provisions of this Agreement.
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11. Law. This Agreement shall be governed by and its provisions shall be
construed in accordance with the laws of the State of Ohio.
12. Severability. If any provision of this Agreement is held to be invalid, the
remaining provisions of the Agreement shall continue to be valid and
enforceable.
13. Notice. Any notice or amendment required or permitted hereunder shall be in
writing and shall be given by personal service, mail, or facsimile to the other
Party at the address set forth below (or such other address as a Fund Party or
the Trust Entity may specify by written notice to the other). Notice shall be
effective upon receipt if by mail, on the date of personal delivery (by private
messenger, courier service or otherwise), or upon receipt of facsimile,
whichever occurs first at: Trust Entity:
Attn: _______________________________________
Fund Agent: Touchstone Securities, Inc.
000 Xxxxxxxx, Xxxxx 0000
Xxxxxxxxxx, XX 00000
Attn: Xxxx X. XxXxxxxx, President and Chief Executive Officer
14. Waiver. The failure of a Party to insist upon strict adherence to any
provision of this Agreement on any occasion shall not be considered a waiver nor
shall it deprive such Party of the right thereafter to insist upon strict
adherence to that provision or any other provision of this Agreement. Any waiver
must be in writing signed by the waiving Party.
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IN WITNESS WHEREOF, the undersigned has caused this Agreement to be
executed as of the date first above written.
ATTEST: Touchstone Securities, Inc.
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By: By:
Title: Title:
TRUST CO
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By: By:
Title: Title:
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