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Exhibit (h)(4)
SERVICING AGREEMENT
Empire Builder Tax Free Bond Fund
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Gentlemen:
We wish to enter into an Agreement with you to service shareholders of, and
administer shareholder accounts in, Empire Builder Tax Free Bond Fund (the
"Trust"), an open-end investment company registered under the Investment Company
Act of 1940 (the "Act").
The terms and conditions of this Agreement are as follows:
1. We shall provide shareholder and administrative services for
shareholders of the Trust who are also clients ("clients"), which services may
include, without limitation and to the extent we are permitted by applicable
statute, rule or regulations: (a) providing necessary personal and facilities to
establish and maintain certain shareholder accounts and records as requested
from time to time by the Trust; (b) arranging for the wiring of funds in
connection with client orders to purchase or redeem Trust shares; (c)
transmitting and receiving funds in connection with client orders to purchase or
redeem Trust shares; (d) verifying and guaranteeing client signatures in
connection with redemption orders, transfers among and changes in
client-designated accounts; (e) providing periodic statements showing a client's
account balances and, to the extent practicable, integrating such information
with other client transactions otherwise effected with or through us; (f)
furnishing (either separately or on an integrated basis with other reports sent
to a client by us) periodic and annual statements and confirmations of all
purchases and redemptions of Trust shares in a client's account; (g)
transmitting proxy statements, annual reports, and updating prospectuses and
other communications from the Trust to clients; and (h) such other services as
the Trust or a client reasonably may request. We shall provide such office space
and equipment, telephone facilities and personnel (which may be all or any part
of the space, equipment and facilities currently used in our business, or all or
any personnel employed by us) as is necessary or beneficial for providing
information and services to shareholders of the Trust, and we may arrange for
third parties to perform certain of these services on our behalf.
2. Neither we nor any of our employees or agents shall be authorized to
make any representation concerning shares of the Trust except those contained in
the then current
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Prospectuses for the Trust, copies of which will be supplied to you by us; and
we shall have no authority to act as agent for the Trust.
3. In consideration of the services and facilities described herein, we
shall be entitled to receive from you fees to be paid periodically (but in no
event less frequently than semi-annually) as set forth in Schedule A attached
hereto; provided that such fees shall not exceed during any period the amount
payable at an annual rate of 0.25% of the average daily net assets of the Trust
represented by shares owned by clients with whom we maintain a servicing
relationship.
It is agreed that we may impose certain conditions on clients, in
addition to, or different from, those imposed by the Trust, such as requiring a
minimum initial investment or charging clients direct fees for the same or
similar services as are provided hereunder by us as agent (which fees either may
relate specifically to our services with respect to the Trust or generally cover
services not limited to those with respect to the Trust). We shall xxxx clients
directly for such fees. In the event we charge clients such fees, to the extent
permissible by applicable statutes, rules and regulations, we shall make
appropriate prior written disclosure (such disclosure to be in accordance with
all applicable laws) to clients both of any direct fees charged to clients and
of the fees received or to be understood, however, that in no event shall we
have recourse or access to the account of any shareholder of the Trust except to
the extent expressively authorized by law or by such shareholder, or to any
assets of the Trust, for payment of any direct fees referred to in this
Agreement.
4. To the extent requested by the Trust from time to time, we agree
that we will provide the Treasurer of the Trust with a written report of the
amounts expended by us and the purposes for which such expenditures were made.
Such written reports shall be in a form satisfactory to the Trust and shall
supply all information necessary for the Trust to discharge its responsibilities
under applicable laws and regulations.
5. To the extent required by Schedule A attached hereto, we shall
maintain separate ledger accounts or such comparable records showing for each
client shareholder of record of the Trust the number of shares of the Trust
held, the name of the Fund in which such shares are hold, the date or dates such
shares were purchased, the number purchased and the price per share. These
records shall be preserved permanently, the first two years in an easily
accessible place, and shall be made available, at the Trust's request, for
inspection and use by the Trust, its representatives and governmental
authorities having jurisdiction over the Trust.
6. To the extent applicable, we shall maintain accurate and complete
records with respect to services performed by us in connection with the purchase
and redemption of shares as required by Rule 17a-3 and 17a-4 under the
Securities Exchange Act of 1934, as amended.
7. The Trust will indemnify and hold us harmless from all losses,
claims, damages, liabilities or expenses from any claim, demand, action or suit
(collectively,
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"Claims"): (a) arising in connection with misstatements or omissions in the
Trust's Prospectuses, actions or inactions by the Trust or any of its agents or
contractors or the performance of our obligations hereunder and (b) not
resulting from (i) our bad faith or negligence, or that of our officers,
employees or agents, or (ii) our breach of applicable law, or any breach by our
officers, employees or agents, or (iii) our actions or those of our officers,
employees or agents which exceeds our legal authority or our authority
hereunder, or (iv) any error or omission committed by us, our officers,
employees or agents with respect to the purchase, redemption and transfer of
clients' shares or our verification or guarantee of any client signature.
Notwithstanding anything herein to the contrary, you will indemnify and hold us
harmless from any and all losses, claims, damages, liabilities or expenses
(including reasonable counsel fees and expenses) resulting from any Claim as a
result of our acting in accordance with any written instructions reasonably
believed by us to have been executed by any person duly authorized by the Trust,
or as a result of acting in reliance upon any instrument or stock certificate
signed, countersigned or executed by a person duly authorized by the Trust,
excepting only our gross negligence or bad faith.
In any case, in which you may be asked to indemnify or hold us
harmless, you shall be advised of all pertinent facts concerning the situation
in question and we shall use reasonable care to identify and notify you promptly
concerning any situation which presents or appears likely to present a claim for
indemnification against you. You shall have the option to defend us against any
Claim which may be the subject of indemnification hereunder. In the event that
you elect to defend against such Claim, the defense shall be conducted by
counsel chosen by you and satisfactory to us. We may retain additional counsel
at our expense. Except with your prior written consent, we shall not confess any
Claim or make any compromise in any case in which you will be asked to indemnify
us.
8. Without limiting you rights under applicable law, we will indemnify
and hold you harmless from all Claims (a) resulting from (i) our bad faith or
negligence, or that of our officers, employees or agents, or (ii) our breach of
applicable law, or (iii) any breach by our officers, employees or agents which
exceed our legal authority or our authority hereunder, or (iv) any error or
omission committed by us, our officers, employees or agents with respect to the
purchase, redemption and transfer of clients shares or our verification or
guarantee of any client signature, and (b) not resulting from actions in
accordance with written instructions reasonably believed by us to have been
executed by any person duly authorized by the Trust or in reliance upon any
instrument or stock certificate reasonably believed by us to have been genuine
and signed, countersigned or executed by a person duly authorized by the Trust.
In any case in which we may be asked to indemnify of hold the Trust
harmless, we shall be advised of all pertinent facts concerning the situation in
question and the Trust shall use reasonable care to identify and notify us
promptly concerning any situation which presents or appears likely to present a
Claim for indemnification against us. We shall have the option to defend the
Trust against any Claim which may be the subject of indemnification hereunder.
In the event that we elect to defend against such
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Claim, the defense shall be conducted by counsel chosen by us and satisfactory
to the Trust. The Trust may retain additional counsel at its expense. Except
with our prior written consent, the Trust shall not confess any Claim or make
any compromise in any case in which we will be asked to indemnify the Trust. The
indemnities granted by the parties in this Agreement shall survive the
termination of this Agreement.
9. This agreement may be terminated by the Trust, without the payment
of any penalty, at any time upon not more than 60 days' nor less than 30 days'
notice, by a vote of a majority of the Board of Trustees who are not "interested
persons" of the Trust (as defined in the Act) or by "a vote of a majority of the
outstanding voting securities" (as defined in the Act) of the Trust. We may
terminate this Agreement upon not more than 60 days' nor less than 30 days'
notice to the Trust. Notwithstanding anything herein to the contrary, this
Agreement may not be assigned and shall terminate automatically without notice
to either party upon any assignment. Upon termination hereof, the Trust shall
pay such compensation as may be due as of the date of such termination.
10. Our appointment as shareholder servicing agent hereunder is
non-exclusive, and the parties hereto recognize and agree that, from time to
time, the Trust may enter into other shareholder servicing agreements, in
writing, with other financial institutions.
11. The Declaration of Trust establishing the Trust, filed on September
30, 1983, a copy of which, together with all amendments thereto (the
"Declaration"), is on file in the Office of the Secretary of the Commonwealth of
Massachusetts, provides that the name "Empire Builder Tax Free Bond Fund" refers
to the Trustees under the Declaration collectively as Trustees and not as
individuals or personally, and that no shareholder, trustee, officer, employee
or agent of the Trust shall be subject to Claims against or obligation of the
Trust to any extent whatsoever, but that the Trust estate only shall be liable.
12. This Agreement may be changed or amended only by written instrument
signed by both parties.
13. This Agreement shall be construed and enforced in accordance with
and governed by the laws of the State of New York. This Agreement may be
executed simultaneously in two or more counterparts, each of which shall be
deemed an original, but all of which taken together shall constitute one and the
same instrument.
Very truly yours,
Xxxxxx Xxxx Xxxxx Xxxxx & Xxxxxx Inc.
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Name
000 Xxxx Xxxxxx
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Address
5
New York, N.Y. 10169
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City/State/Zip Code
Date: July 1, 1988 By: /s/ illegible .
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Authorized Signature
Accepted:
Empire Builder Tax Free Bond Fund
Date: July 1, 1988 By: /s/ Xxxx X. Xxxxxxx
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Xxxx X. Xxxxxxx
