ADDENDUM
TO THE
TRANSFER AGENCY AGREEMENT
Addendum ("Addendum") to the Transfer Agency Agreement (the
"TA Agreement"), made as of the 22nd day of April, 1996, between each fund
listed in the Schedule A attached to the TA Agreement having its principal
office and place of business at 000 Xxxxx Xxxxxx, Xxx Xxxx, XX 00000 (each fund
hereinafter referred to as the "Fund"), and Xxxxx & Xxxx Services L.P., a
Delaware limited partnership, having its principal office and place of business
at 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the "Transfer Agent").
W I T N E S S E T H
WHEREAS, all defined terms in the TA Agreement shall have the
same meaning with respect to this Addendum,
WHEREAS, Article V, Section 7 of the TA Agreement authorizes
the Transfer Agent to honor check cashing redemptions as described in the Fund's
Prospectus and to process such redemptions upon receipt of moneys paid to it by
Investors Fiduciary Trust Company, the Funds' custodian (the "Custodian");
WHEREAS, the Transfer Agent has entered into a cash management
agreement (the "Delaware Express Agreement"), a copy of which is attached hereto
as Exhibit A, with Bankers Trust Company, a New York banking corporation
("BTCo") and Bankers Trust (Delaware), a Delaware state bank ("BT Delaware"),
together sometimes referred to hereinafter as "BT", to facilitate check
redemptions by each Fund's shareholders and, in accordance with the terms of the
Delaware Express Agreement, BT serves as the "paying agent";
WHEREAS, pursuant to the Delaware Express Agreement, BT
Delaware has established a zero-balance account (the "Account") for the Transfer
agent on behalf of the Fund;
WHEREAS, pursuant to the Delaware Express Agreement, the
Account is funded from a deposit account maintained by the Transfer Agent on
behalf of the Fund with BTCo (the "Source Account");
WHEREAS, from time to time the Transfer Agent makes payment or
transfer of monies on behalf of the Fund for which there would be, at the close
of business on the date of such payment or transfer, insufficient monies held by
the Transfer
Agent in the Account or Source Account to allow the completion of
such payment or transfer;
WHEREAS, the Fund acknowledges that it is necessary and
appropriate to authorize the Transfer Agent on the Fund's behalf to request that
the Custodian process certain daily anticipatory redemptions effected in
accordance with such Fund's check cashing privilege with BT,
WHEREAS, the Transfer Agent desires to have available funds
deposited by the Custodian with BT in order to meet such anticipatory redemption
requests upon the exercise of the check cashing privilege,
WHEREAS, from time to time, pursuant to the Express Agreement,
BTCo may permit overdrafts (each an "Overdraft") on the Source Account;
WHEREAS, the purpose of such Overdrafts is to provide
temporary liquidity for redemptions on behalf of the Fund;
That for and in consideration of the mutual promises hereinafter set
forth, the parties hereto covenant and agree as follows:
Notwithstanding the provisions of Article V, Section 7 of the
TA Agreement, the Transfer Agent may honor the payment of redemption requests
through the use of certain anticipatory redemptions for the Fund prior to its
receipt of proper instructions from a redeeming shareholder in accordance with
the terms of the current prospectus and the receipt of the full redemption
proceeds from the Custodian.
The Transfer Agent shall notify the Fund upon receiving
written notification from BT of an overdraft of the Source Account.
The Fund hereby authorizes the Transfer Agent to instruct the
Custodian to advance additional monies immediately to BT to cover any shortage
in the Source Account upon receipt of such written notice of such overdraft from
BT.
The Fund shall notify its Custodian in writing that 1% of
its net assets shall be held by the Custodian in a segregated account solely for
the benefit of BT to cover any potential shortage in the Source Account as a
result of an Overdraft created by BT honoring the check redemption privilege.
The Transfer Agent will deliver to BT, within five
days of the end of each calendar month, certification in a form reasonably
acceptable to BT of (i) the amount held in such segregated account on behalf of
the Fund, (ii) the net assets of
the Fund, (iii) the average Overdraft activity for the fund for such month and
(iv) evidence that the segregated account is being maintained as required by
this Addendum, each as of the end of such month.
The Fund agrees that upon notice from BT that the
agreed-upon percentage set forth in Section 4 of this Addendum is more or less
than the historical Overdraft rate incurred by the Fund over the previous two
calendar months, the Fund shall immediately direct its Custodian in writing to
withdraw or deposit, as the case may be, sufficient assets from or into, as the
case may be, such segregated account to cause the amount held in such segregated
account to equal the percentage so indicated by the Fund.
Notwithstanding Article X, Section 8 of the TA
Agreement, the provisions of this Addendum to the Transfer Agent may be relied
upon by and shall inure to the benefit of BT, its successors and assigns, and
all rights granted to the Transfer Agent hereunder, shall be exercisable by BT
as if granted directly to BT by this Addendum.
8. In the event of the addition or deletion of any Fund to the
TA Agreement, the Transfer Agent shall notify BT of any such changes prior to
such change and shall provide BT with a re-executed copy of this Addendum, as
may be amended from time to time.
IN WITNESS WHEREOF, the parties hereto have caused this
Addendum to be executed in counterpart as of November , 1996.
Attest: Daily Tax Free Income Fund, Inc.
Florida Daily Municipal Income Fund
Short Term Income Fund, Inc.
California Daily Tax Free Income Fund, Inc.
New York Daily Tax Free Income Fund, Inc.
North Carolina Daily Municipal Income Fund, Inc.
Michigan Daily Tax Free Income Fund, Inc.
New Jersey Daily Municipal Income Fund, Inc.
Tax Exempt Proceeds Fund, Inc.
Pennsylvania Daily Municipal Income Fund
Cortland Trust, Inc.
Connecticut Daily Tax Free Income Fund, Inc.
/s/ Xxxxxxxxx Xxxxxxx By:/s/ Xxxxxxxxxx X. Xxxx
Name: Xxxxxxxxxx X. Xxxx
Title: Secretary
Attest: XXXXX & XXXX SERVICES L.P.
By: XXXXX & TANG ASSET MANAGEMENT,
INC., as General Partner
/s/ Xxxxxxxxx Xxxxxxx By:/s/ Xxxxxxx XxXxxxxxx
Name: Xxxxxxx XxXxxxxxx
Title: Treasurer
AGREED AND ACCEPTED:
Bankers Trust Company
By: /s/ Xxxx X. Xxxx
Name: Xxxx X. Xxxx
Title: Vice President
Bankers Trust (Delaware)
By: /s/ Xxxxxx X. Xxxxxxx
Name: Xxxxxx X. Xxxxxxx
Title: Vice President & COO
