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EXHIBIT(e)(3)
NSCC AGREEMENT
BY AND BETWEEN
SUNSTONE DISTRIBUTION SERVICES, LLC
AND
E-XXXXXX FUNDS
THIS AGREEMENT is made as of this 23rd day of April, 2000, by and
between e-xxxxxx Funds, a Delaware business trust (the "Trust") and Sunstone
Distribution Services, LLC, a Wisconsin limited liability company ("Sunstone").
WHEREAS, the Trust is a registered open-end management investment
company and Sunstone and its affiliates act in various capacities including
distributor, administrator, fund accountant and transfer agent;
WHEREAS, the Trust desires that its shares be permitted to be traded
through Fund/SERV and participate in the Networking System ("Networking") and
any other relevant programs or services offered by the National Securities
Clearing Corporation ("NSCC") now and in the future; and
WHEREAS, Sunstone is currently a member of NSCC and at the request of
the Trust, desires to assist the Trust with expediting its trading in Fund/SERV
and its participation in Networking.
NOW, THEREFORE, in consideration of the mutual promises and agreements
herein contained and other good and valuable consideration, the receipt of which
is hereby acknowledged, the parties hereto, intending to be legally bound, do
hereby agree as follows:
1. PROCEDURES
(a) Sunstone agrees to permit the Trust's trading through
Fund/SERV and participation in Networking through Sunstone's NSCC membership,
and such other programs and services as may be offered by NSCC as the parties
may mutually agree, subject to the terms and conditions herein.
(b) Sunstone shall enter into a Fund Member Additional Number
Agreement with NSCC pursuant to which an additional number will be issued in
conjunction with Sunstone's NSCC activities on behalf of the Trust. Sunstone
shall in no way be deemed to act as a distributor or underwriter for the Trust
solely through its sponsorship of the Trust. Sunstone Financial Group, Inc., in
its role as transfer agent for the Trust, shall act as agent for the purposes of
mutual fund settlement and Networking pursuant to the terms of the Transfer
Agency Agreement by and between the Trust and Sunstone Financial Group, Inc. The
Trust shall arrange for a settling bank who will perform all functions required
of settling banks under applicable rules of the NSCC.
(c) Upon the request of the Trust and in reliance on the terms
hereof, and in order to expedite the trading of the shares of the Trust through
NSCC and participation in Networking and any other relevant programs and
services offered by NSCC as agreed to by the parties, Sunstone has agreed to
guarantee the payment to NSCC of any and all fees and charges imposed by NSCC
from time to time relating to the Trust's transactions with NSCC, and has
assumed responsibility with respect to NSCC for all transactions in and all
obligations and liabilities relating to the Trust's clearing number and
participation in Networking.
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(d) This Agreement shall be effective as of the date hereof
and shall continue in effect as long as Sunstone acts as Fund Member for the
Trust with the exception of Section 2 which will survive indefinitely the
termination of Sunstone's participation in NSCC on behalf of the Trust. It is
understood that Sunstone may, in its sole discretion, and at any time, terminate
any or all of its participation in NSCC on behalf of the Trust. In the event
Sunstone elects to cease these services, it will provide prompt notice to the
Trust.
2. PAYMENT OF CHARGES, EXPENSES, OBLIGATIONS; LIABILITY
(a) As consideration for Sunstone's NSCC activities on behalf
of the Trust, the Trust agrees, to the extent permitted under applicable rules
and regulations, to pay or cause to be paid any and all fees, charges, and
obligations (including settling transactions) imposed by NSCC from time to time
relating to the Trust, and the Trust assumes sole responsibility for all
transactions in and all obligations and liabilities relating to the Trust, as if
the Trust and not Sunstone were the Trust Member. Sunstone shall not finance any
such expenses or charges.
(c) The Trust shall indemnify, defend and hold harmless
Sunstone and its affiliates from and against any and all actions, suits, claims,
demands, losses, expenses, charges and liabilities whether with or without basis
in fact or law (including the costs of investigating or defending any alleged
actions, suits, claims, demands, losses, expenses, charges and liabilities)
(collectively "Losses") of any and every nature which Sunstone or its affiliates
may sustain or incur or which may be asserted against Sunstone or its affiliates
by any person arising directly or indirectly out of, resulting from, or in
conjunction with Sunstone's participation in Fund/SERV, Networking and any other
relevant programs or services offered by the NSCC, now and in the future, on
behalf of the Trust; provided, however, that Sunstone shall not be indemnified
against any Losses to the extent arising out of Sunstone's willful misfeasance,
gross negligence or reckless disregard of its duties and obligations in
participating in the foregoing on behalf of the Trust.
(d) Sunstone shall indemnify, defend and hold harmless the
Trust and its affiliates from and against any and all Losses of any and every
nature which the Trust or its affiliates may sustain or incur or which may be
asserted against the Trust or its affiliates by any person to the extent such
Losses arise out of Sunstone's willful misfeasance, gross negligence or reckless
disregard of its duties and obligations under this Agreement.
(e) The Trust shall take all such actions as may reasonably be
requested by Sunstone to implement the understandings described herein with
respect to Sunstone's activities with NSCC on behalf of the Trust.
E-XXXXXX FUNDS SUNSTONE DISTRIBUTION SERVICES, LLC
(the "Trust') ("Sunstone")
By: By:
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President Vice President
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