DELAWARE GROUP DELAWARE FUND, INC.
SHAREHOLDERS SERVICES AGREEMENT
THIS AGREEMENT, made as of this 29th day of June, 1988 by and between
DELAWARE GROUP DELAWARE FUND, INC. ("Fund"), a Maryland Corporation, and
DELEWARE SERVICE COMPANY, INC. ("DSC"), a Delaware Corporation, each having its
principal office and place of business at Xxx Xxxx Xxxxxx Xxxxx, Xxxxxxxxxxxx,
Xxxxxxxxxxxx 00000.
W I T N E S S E T H:
WHEREAS, the Investment Management Agreement between Fund and Delaware
Management Company, Inc. provides that Fund shall conduct its own business and
affairs and shall bear the expenses and salaries necessary and incidental
thereto including, but not in limitation of the foregoing, the costs incurred
in: the maintenance of its corporate existence; the maintenance of its own
books, records and procedures; dealing with its own shareholders; the payment of
dividends; transfer of stock, including issuance and redemption of shares;
reports and notices to shareholders; calling and holding of shareholder
meetings; miscellaneous office expenses; brokerage commissions; legal and
accounting fees; taxes; and federal and state registration fees; and
WHEREAS, the predecessor to DSC previously served as the Shareholder
Services Agent for the Fund and the Fund has designated DSC to act as
Shareholder Services Agent for Fund as of the date of this Agreement; and
WHEREAS, Fund and DSC desire to have a written agreement concerning the
performance of the foregoing services and providing compensation therefor;
NOW, THEREFORE, in consideration of the mutual covenants hereinafter
set forth, and intending legally to be bound, it is agreed:
I. APPOINTMENT AS AGENT
Section 1.1 Fund hereby appoints DSC its Shareholder Services Agent to
provide as agent for the Fund services as Transfer Agent, Dividend Disbursing
Agent and Shareholder Servicing Agent and DSC hereby accepts such appointment
and agrees to provide Fund, as its agent, the services described
herein.
Section 1.2 Fund shall pay DSC and DSC shall accept, for the services
provided hereunder, the compensation provided for in Section VIII hereof. Fund
also shall reimburse DSC for expenses incurred or advanced by it for the Fund in
connection with its services hereunder.
II. DOCUMENTATION
Section 2.1 Fund represents that it has provided or made available to
DSC (or has given DSC an opportunity to examine) copies of, and, DSC represents
that it has received from Fund (or is otherwise familiar with), the following
documents:
A. The Articles of Incorporation or other
document evidencing Fund's form of organization and any current amendments
thereto.
B. The By-Laws of Fund;
C. Any resolution or other action of Fund or
the Board of Directors of Fund establishing or affecting the rights, privileges
or other status of any class or series of shares of Fund, or altering or
abolishing any such class or series;
D. A certified copy of a resolution of the
Board of Directors of Fund appointing DSC as Shareholder Services Agent and
authorizing the execution of this Agreement;
E. The form of share certificates of Fund in
the form approved by the Board of Directors of Fund;
F. A copy of Fund's currently effective
prospectus and Statement of Additional Information under the Securities act of
1933;
G. Copies of all account application forms
and other documents relating to shareholder accounts in Fund.
H. Copies of documents relating to Plans of
Fund for the purchase, sale or repurchase of its shares, including periodic
payment or withdrawal plans, reinvestment plans or retirement plans;
-2-
I. Any opinion of counsel to Fund relating
to the authorization and validity of the shares of Fund issued or proposed to be
issued under the law of the State of Fund's organization, including the status
thereof under any applicable securities laws;
J. A certified copy of any resolution of the
Board of Directors of Fund authorizing any person to give instructions to DSC
under this Agreement, (with a specimen signature of such person if not already
provided), setting forth the scope of such authority; and
K. Any amendment, revocation or other
document altering, adding, qualifying or repealing any document or authority
called for under this Section 2.1.
Section 2.2 Fund and DSC may consult as to forms or documents that may
be required in performing services hereunder.
Section 2.3 Fund shall provide or make available to DSC a certified
copy of any resolution of the shareholders or the Board of Directors of Fund
providing for a dividend, capital gains distribution, distribution of capital,
stock dividend, stock split or other similar action affecting the authorization
or issuance of shares of Fund or the payment of dividends.
Section 2.4 In the case of any recapitalization or other capital
adjustment requiring a change in the form of stock or share certificate or the
books recording the same, Fund shall deliver or make available to DSC:
A. A certified copy of any document
authorizing or effecting such change;
B. Written instructions from an authorized
officer implementing such change; and
C. An opinion of counsel to Fund as to the
validity of such action, if requested by DSC.
Section 2.5 Fund warrants the following:
A. Fund is, or will be, a properly
registered investment company under the Investment Company Act of 1940 and any
and all shares which it issues will be properly registered and lawfully issued
under applicable federal and state laws.
-3-
B. The provisions of this contract do not
violate the terms of any instrument by which the Fund is bound; nor do they
violate any law or regulation of any body having jurisdiction over the Fund or
its property.
Section 2.6 DSC warrants the following:
A. DSC is and will be properly registered as
a transfer agent under the Securities Exchange Act of 1934 and is duly
authorized to serve, and may lawfully serve as such.
B. The provisions of this contract do not
violate the terms of any instrument by which the Fund is bound; nor do they
violate any law or regulation of any body having jurisdiction over DSC or its
property.
III. SHARE CERTIFICATES
Section 3.1 Fund shall furnish or authorize DSC to obtain, at Fund's
expense, a sufficient supply of blank stock certificates, and from time to time
will replenish such supply upon the request of DSC. Fund agrees to indemnify and
exonerate, save and hold DSC harmless, from and against any and all claims or
demands that may be asserted against DSC concerning the genuineness of any stock
certificate supplied to DSC pursuant to this section.
Section 3.2 DSC shall safeguard, and shall account to Fund, upon its
demand for, all such share certificates: (A) as issued, showing to whom issued,
or (B) as unissued, establishing the safekeeping, cancellation or destruction
thereof.
Section 3.3 Fund shall promptly inform DSC in writing of any change in
the officers authorized to sign share certificates or in the form thereof. If an
officer whose manual or fascimile signature is affixed to any blank share
certificate shall die, resign or be removed prior to the issuance of such
certificate, DSC may nevertheless issue such certificate notwithstanding such
death, resignation or removal, and the Fund shall with respect thereto, promptly
provide to DSC any approval, adoption or ratification as may be required by DSC.
-4-
IV. TRANSFER AGENT
Section 4.1 As Transfer Agent, DSC shall issue, redeem and transfer
Fund shares, and, in connection therewith but not in limitation thereof, it
shall:
A. Upon receipt of authority to issue
shares, determine the total shares to be issued and issue such shares by
crediting shares to accounts created and maintained in the registration forms
provided; as applicable, prepare, issue and deliver stock certificates.
B. Upon proper transfer authorization,
transfer shares by debiting transferor-shareholder accounts and crediting such
shares to accounts created and/or maintained for transferee-shareholders; if
applicable, issue and/or cancel stock certificates.
C. Upon proper redemption authorization,
determine the total shares to be redeemed and redeemed; determine the total
redemption payments to be made and made; redeem shares by debting shareholder
accounts; as applicable receive and cancel stock certificates for shares
redeemed; and remit or cause to be remitted the redemption proceeds to
shareholders.
D. Create and maintain accounts; reconcile
and control cash due and paid, shares issued and to be issued, cash to be
remitted and remitted and shares debted and credited to accounts; provide such
notices, instructions or authorizations as Fund may require.
Section 4.2 DSC shall not be required to issue, transfer or redeem Fund
shares upon receipt of it from Fund, or from any federal or state regulatory
agency or authority, written notice that the issuance, transfer or redemption of
Fund shares has been suspended or discontinued.
V. DIVIDEND DISBURSING AGENT
Section 5.1 As Dividend Disbursing Agent, DSC shall disburse and cause
to be disbursed to Fund shareholders Fund dividends, capital gains distributions
or any payments from other sources as directed by Fund. In connection therewith,
but not in limitation thereof, DSC shall:
-5-
A. Calculate the total disbursement due and
payable and the disbursement to each shareholder as to shares owned, in
accordance with Fund's authorization.
B. Calculate the total disbursements for
each shareholder, as aforesaid, to be disbursed in cash; prepare and mail check
therefor.
C. Calculate the total disbursement for each
shareholder, as aforesaid, for which Fund shares are to be issued, and
authorized and instruct the issuance of Fund shares therefor in accordance with
Section IV hereof.
D. Prepare and mail or deliver such forms
and notices pertaining to disbursements as required by the federal or state
authority.
E. Create and maintain records, reconcile
and control disbursements to be made and made, both as to cash and shares, as
aforesaid; provide such notices, instruction or authorization as Fund may
require.
Section 5.2 DSC shall not be required to make any disbursement upon the
receipt from Fund, or from any federal or state agency or authority, written
notice that such disbursement shall not be made.
VI. SHAREHOLDER SERVICING AGENT
Section 6.1 As Shareholder Servicing Agent, DSC shall provide those
services ancillary to but in implementation of the services provided under
Sections I through V hereof, and those generally defined and accepted as
Shareholder Services. In connection therewith, but not in limitation thereof,
DSC shall:
A. Except where instructed in writing by the
Fund not to do so, and where in compliance with applicable law, accept orders on
behalf of the Fund; receive and process investments and applications; remit to
Fund or its custodian payments for shares acquired and to be issued; and direct
the issuance of shares in accordance with Section IV hereof.
B. Receive, record and respond to
communications of shareholders and their agents.
-6-
C. As instructed by Fund, prepare and mail
shareholder account information, mail Fund shareholder reports and Fund
prospectuses.
D. Prepare and mail Fund proxies and
material for Fund shareholder meetings, receive and process proxies from
shareholders, and deliver such proxies as directed by Fund.
E. Administer investment plans offered by
Fund to investors and Fund shareholders, including Retirement Plans, including
activities not otherwise provided in Section I through V of this Agreement.
VII. PERFORMANCE OF DUTIES
Section 7.1 The parties hereto intend that Fund shareholders and their
shareholdings shall be confidential, and any information relating thereto shall
be released by DSC only to those persons or authorities who DSC has reason to
believe are authorized to receive such information; or, as instructed by Fund.
Section 7.2 DSC may, in performing this Agreement, require Fund or
Fund's distributor to provide it with an adequate number of copies of
prospectuses, reports or other documents required to be furnished to investors
or shareholders.
Section 7.3 DSC may request or receive instructions from Fund and may
at Fund's expense, consult with counsel for the Fund or its own counsel, with
respect to any matter arising in connection with the performance of its duties
hereunder, and shall not be liable for any action taken or omitted by it in good
faith in accordance with such instructions or opinions of counsel.
Section 7.4 DSC shall maintain reasonable insurance coverage for errors
and omissions and reasonable bond coverage for fraud.
Section 7.5 Upon notice thereof to Fund DSC may employ others to
provide services to DSC in its performance of this Agreement.
-7-
Section 7.6 Personnel and facilities of DSC used to perform services
hereunder may be used to perform similar services to other Funds of the Delaware
Group and to others, and, may be used to perform other services for Fund, the
other Funds of the Delaware Group and others.
Section 7.7 DSC shall provide its services as transfer agent hereunder
in accordance with Section 17 of the Securities Exchange Act of 1934, and the
rules and regulations thereunder. Further, the parties intend that the
processes, procedures, safeguards and controls employed should be those
generally applied and accepted for the type services provided hereunder by other
institutions providing the same or similar services, and, those which should
provide efficient, safe and economical services so as to promote promptness and
accuracy and to maintain the integrity of Fund's records.
Section 7.8 Fund and DSC may, from time to time, set forth in writing
Guidelines For Selective Procedures to be applicable to the services hereunder.
VIII. COMPENSATION
Section 8.1 Fund and DSC acknowledge that because DSC has common
ownership and close management ties with Fund's investment advisor and Fund's
distributor and serves the other Funds of the Delaware Group, DSC having been
originally established to provide the services hereunder for Fund and the other
Funds of the Delaware Group, advantages and benefits to Fund in the employment
of DSC hereunder can be available which may not generally be available to it
from others providing similar services.
Section 8.2 Fund and DSC further acknowledge that the compensation by
Fund to DSC is intended to induce DSC to provide services under this agreement
of a nature and quality which the Board of Directors of Fund, including a
majority who are not parties to this agreement or interested person of the
parties hereto, has determined after due consideration to be necessary for the
conduct of the business of the Fund in the best interests of Fund and its
shareholders.
Section 8.3 Compensation by Fund to DSC hereunder shall be determined
in accordance with Schedule A hereto as it shall be amended from time to time as
provided for herein and which is incorporated herein as a part hereof.
-8-
Section 8.4 Compensation as provided in Schedule A shall be reviewed
and approved in the manner set forth in Section 10.1 hereof by the Board of
Directors of Fund at least annually and may be reviewed and approved more
frequently at the request of either party. The Board may request and DSC shall
provide such information as the Board may reasonably require to evaluate the
basis of and approve the compensation.
IX. STANDARD OF CARE
Section 9.1 Fund acknowledges that DSC shall not be liable for, and in
the absence of willful misfeasance, bad faith, gross negligence or reckless
disregard of the performance of its duties under this contract, agrees to
indemnify DSC against, any claim, or deficiency arising from the performance of
DSC's duties hereunder, including DSC's costs, counsel fees and expenses
incurred in investigating or defending any such claim or any administrative or
other proceeding, and acknowledges that any risk of loss or damage arising from
the conduct of the Fund's affairs in accordance herewith or in accordance with
Guidelines or instructions given hereunder, shall be borne by Fund.
X. CONTRACTUAL STATUS
Section 10.1 This Agreement shall be executed and become effective on
the date first written above if approved by a vote of the Board of Directors,
including an affirmative vote of a majority of the non-interested members of the
Board, cast in person at a meeting called for the purpose of voting on such
approval. It shall continue in effect for an indeterminate period, and is
subject to termination on sixty (60) days notice by either party unless earlier
terminated or amended by agreement among the parties. Compensation under this
Agreement shall require approval by a majority vote of the Board of Directors of
Fund, including an affirmative vote of the majority of the non-interested
members of the Board cast in person at a meeting called for the purpose of
voting such approval.
Section 10.2 This Agreement may not be assigned without the approval of
Fund.
-9-
Section 10.3 This Agreement shall be governed by the laws of the
Commonwealth of Pennsylvania.
DELAWARE SERVICE COMPANY, INC.
/s/ Xxxxxx X. Xxxxxxx
----------------------------
Xxxxxx X. Xxxxxxx
ATTEST: /s/ Xxxxxx X. Xxxxxxxxxxx
---------------------------
Xxxxxx X. Xxxxxxxxxxx
DELAWARE GROUP DELAWARE FUND, INC.
/s/ Xxxxx X. Xxxxx
-----------------------------
Xxxxx X. Xxxxx
ATTEST: /s/ Xxxxxxx X. Beach
---------------------------
Xxxxxxx X. Beach
-10-
SCHEDULE A
COMPENSATION
1. DSC will determine and report to the Fund, at least annually, the
compensation for services to be provided to the Fund for DSC's
forthcoming fiscal year or period.
2. In determining such compensation, DSC will fix and report a fee to be
charged per account and/or per transaction, as may be applicable, for
services provided. DSC will xxxx, and the Fund will pay, such
compensation monthly.
3. For the period commencing October 1, 1984, the charge
will be at the annual rate of $9.50 per account.
SCHEDULE A
COMPENSATION
1. DSC will determine and report to the Fund, at least annually, the
compensation for services to be Provided to the Fund for DSC's
forthcoming fiscal year or period.
2. In determining such compensation, DSC will fix and report a fee to be
charged per account and/or per transaction, as may be applicable, for
services provided. DSC will xxxx, and the Fund will pay, such
compensation monthly.
3. The fee will consist of an annual per account charge
coupled with a series of transaction charges. These are
as follows:
A. ANNUAL CHARGE
Daily Dividend Funds $9.00 per annum
Other Funds $4.20 per annum
B. TRANSACTION CHARGE
TRANSACTION CHARGE
----------- ------
1. Dividend Payment $ 0.35
2. New Account 5.75
3. Purchase:
a. Wire 6.00
b. Money Market Automated 1.50
c. Other 2.25
4. Transfer 2.25
5. Certificate Issuance 2.00
6. Liquidation:
a. Wire 12.25
b. Draft .50
c. Money Market Regular 2.50
d. Daily Dividend Regular 6.00
7. Exchanges 7.00
