Shareholder Service Agreement
This agreement is between IDS Tax-Exempt Bond Fund, Inc. (the "Corporation") on
behalf of its underlying series fund: IDS Intermediate Tax-Exempt Fund (the
"Fund"); and American Express Financial Advisors Inc., the principal underwriter
of the Fund, for services to be provided to shareholders by personal financial
advisors and other servicing agents.
American Express Financial Advisors Inc. represents that shareholders consider
their financial advisor or servicing agent a significant factor in their
satisfaction with their investment and, to help retain financial advisors or
servicing agents, it is necessary for the Fund to pay annual servicing fees to
financial advisors and other servicing agents.
American Express Financial Advisors Inc. represents that fees paid to financial
advisors will be used by financial advisors to help shareholders thoughtfully
consider their investment goals and objectively monitor how well the goals are
being achieved. As principal underwriter, American Express Financial Advisors
Inc. will use its best efforts to assure that other distributors provide
comparable services to shareholders for the servicing fees received.
American Express Financial Advisors Inc. agrees to monitor the services provided
by financial advisors and servicing agents, to measure the level and quality of
services provided, to provide training and support to financial advisors and
servicing agents and to devise methods for rewarding financial advisors and
servicing agents who achieve an exemplary level and quality of services.
The Corporation agrees to pay American Express Financial Advisors Inc. and other
servicing agents 0.15 percent of the net asset value for each shareholder
account assigned to a financial advisor or servicing agent that holds either of
the Fund's Class A or Class B Common Stock, $0.01 par value per share (the
"Class A Shares" and "Class B Shares"). In addition, the Corporation, on behalf
of the Fund, agrees to pay American Express Financial Advisors Inc.'s costs to
monitor, measure, train and support services provided by financial advisors or
servicing agents up to 0.025 percent of the net asset value for each shareholder
account assigned to a financial advisor or servicing agent that holds either
Class A Shares or Class B Shares. The Corporation agrees to pay American Express
Financial Advisors Inc. in cash within five (5) business days after the last day
of each month.
American Express Financial Advisors Inc. agrees to provide the Fund, prior to
the beginning of the calendar year, a budget covering its expected costs to
monitor, measure, train and support services and a quarterly report of its
actual expenditures. American Express Financial Advisors Inc. agrees to meet
with representatives of the Fund at their request to provide information as
may be reasonably necessary to evaluate its performance under the terms of
this agreement.
American Express Financial Advisors Inc. agrees that if, at the end of any
month, the expenses of the Fund, including fees under this agreement and any
other agreement between the Fund and American Express Financial Advisors Inc. or
American Express Financial Corporation, but excluding taxes, brokerage
commissions and charges in connection with the purchase and sale of assets
exceed the most restrictive applicable state expense limitation for the Fund's
current fiscal year, the Fund shall not pay fees and expenses under this
agreement to the extent necessary to keep the Fund's expenses from exceeding the
limitation, it being understood that American Express Financial Advisors will
assume all unpaid expenses and xxxx the Fund for them in subsequent months but
in no event can the accumulation of unpaid expenses or billing be carried past
the end of the Fund's fiscal year.
This agreement shall continue in effect for a period of more than one year so
long as it is reapproved at least annually at a meeting called for the purpose
of voting on the agreement by a vote, in person, of the members of the Board who
are not interested persons of the Corporation and have no financial interest in
the operation of the agreement, and of all the members of the Board.
This agreement may be terminated at any time without payment of any penalty by a
vote of a majority of the members of the Board who are not interested persons of
the Corporation and have no financial interest in the operation of the agreement
or by American Express Financial Advisors Inc. The agreement will terminate
automatically in the event of its assignment as that term is defined in the
Investment Company Act of 1940. This agreement may be amended at any time
provided the amendment is approved in the same manner the agreement was
initially approved and the amendment is agreed to by American Express Financial
Advisors Inc.
Approved this 13th day of November, 1996.
IDS TAX-EXEMPT BOND FUND, INC.
IDS INTERMEDIATE TAX-EXMPT FUND
/s/ Xxxxxx X. Xxx
Xxxxxx X. Xxx
Vice President
AMERICAN EXPRESS FINANCIAL ADVISORS INC.
/s/ Xxxxxxx X. Xxxxx
Xxxxxxx X. Xxxxx
Vice President
