EXHIBIT (h)(1)
TRANSFER AGENT SERVICING AGREEMENT
THIS AGREEMENT is made and entered into as of this 31st day of December,
1999, by and between Xxxxx Growth Fund, Inc., Xxxxx Funds, Inc. and American
Eagle Funds, Inc., corporations organized under the laws of the State of
Minnesota (each hereinafter referred to as the "Company"), and Firstar Mutual
Fund Services, LLC, a limited liability company organized under the laws of the
State of Wisconsin (hereinafter referred to as "FMFS").
WHEREAS, the Company is an open-end investment management company
registered under the Investment Company Act of 1940, as amended (the "1940
Act");
WHEREAS, the Company is authorized to create separate series, each with its
own separate investment portfolio;
WHEREAS, FMFS is in the business of providing, among other things, transfer
agent and dividend disbursing agent services to investment companies; and
WHEREAS, the Company desires to retain FMFS to provide transfer agent
services to each of the portfolios of the Company, (each a "Fund") and each
additional series of the Company listed on Exhibit A attached hereto, as it may
be amended from time to time.
NOW, THEREFORE, in consideration of the mutual agreements herein made, the
Company and FMFS agree as follows:
1. APPOINTMENT OF TRANSFER AGENT
The Company hereby appoints FMFS as Transfer Agent of the Company on the
terms and conditions set forth in this Agreement, and FMFS hereby accepts such
appointment and agrees to perform the services and duties set forth in this
Agreement in consideration of the compensation provided for herein.
2. DUTIES AND RESPONSIBILITIES OF FMFS
FMFS shall perform all of the customary services of a transfer agent and
dividend disbursing agent, and as relevant, agent in connection with
accumulation, open account or similar plans (including without limitation any
periodic investment plan or periodic withdrawal program), including but not
limited to:
A. Receive orders for the purchase of shares;
B. Process purchase orders with prompt delivery, where appropriate, of
payment and supporting documentation to the Company's custodian, and
issue the appropriate
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number of uncertificated shares with such uncertificated shares being
held in the appropriate shareholder account;
C. Arrange for issuance of Shares obtained through transfers of funds
from Shareholders' accounts at financial institutions and arrange for
the exchange of Shares for shares of other eligible investment
companies, when permitted by Prospectus.
D. Process redemption requests received in good order and, where
relevant, deliver appropriate documentation to the Company's
custodian;
E. Pay monies upon receipt from the Company's custodian, where relevant,
in accordance with the instructions of redeeming shareholders;
F. Process transfers of shares in accordance with the shareholder's
instructions;
G. Process exchanges between funds and/or classes of shares of funds.
H. Prepare and transmit payments for dividends and distributions declared
by the Company with respect to the Fund, after deducting any amount
required to be withheld by any applicable laws, rules and regulations
and in accordance with shareholder instructions;
I. Make changes to shareholder records, including, but not limited to,
address changes in plans (i.e., systematic withdrawal, automatic
investment, dividend reinvestment, etc.);
J. Record the issuance of shares of the Fund and maintain, pursuant to
Rule 17ad-10(e) promulgated under the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), a record of the total number of
shares of the Fund which are authorized, issued and outstanding;
K. Prepare shareholder meeting lists and, if applicable, mail, receive
and tabulate proxies;
L. Mail shareholder reports and prospectuses to current shareholders;
M. Prepare and file U.S. Treasury Department Forms 1099 and other
appropriate information returns required with respect to dividends and
distributions for all shareholders;
N. Provide shareholder account information upon request and prepare and
mail confirmations and statements of account to shareholders for all
purchases, redemption's and other confirmable transactions as agreed
upon with the Company;
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O. Mail requests for shareholders' certifications under penalties of
perjury and pay on a timely basis to the appropriate Federal
authorities any taxes to be withheld on dividends and distributions
paid by the Company, all as required by applicable Federal tax laws
and regulations;
P. Provide a Blue Sky System, which will enable the Company to monitor
the total number of shares of the Fund, sold in each state. In
addition, the Company or its agent, including FMFS, shall identify to
FMFS in writing those transactions and assets to be treated as exempt
from the Blue Sky reporting for each state. The responsibility of FMFS
for the Company's Blue Sky state registration status is solely limited
to the initial compliance by the Company and the reporting of such
transactions to the Company or its agent;
Q. Answer correspondence from shareholders, securities brokers and others
relating to FMFS's duties hereunder and such other correspondence as
may from time to time be mutually agreed upon between FMFS and the
Company.
Reimburse the Fund each month for all material losses resulting from "as
of" processing errors for which FMFS is responsible in accordance with the "as
of" processing guidelines set forth in the following paragraph.
FMFS will reimburse the Fund(s) for any net material loss that may exist on
the Fund(s) books and for which FMFS is responsible, at the end of each calendar
month. "Net Material Loss" shall be defined as any remaining loss, after netting
losses against any gains, which impacts the Fund's net asset value by more than
1/2 cent. Gains and losses will be accumulated on a daily basis, will be
reflected on the Fund's daily share sheet, and will be settled on a monthly
basis. FMFS will notify the Fund's advisor on the daily share sheet of any
losses for which the Fund's adviser may be held accountable.
3. COMPENSATION
FMFS shall be compensated for providing the services set forth in this
Agreement in accordance with the Fee Schedule attached hereto as Exhibit A and
as mutually agreed upon and amended from time to time. The Company agrees to pay
all fees and reimbursable expenses within ten (10) business days following the
receipt of the billing notice.
4. REPRESENTATIONS OF FMFS
FMFS represents and warrants to the Company that:
A. It is a corporation duly organized, existing and in good standing
under the laws of Wisconsin;
B. It is a registered transfer agent under the Exchange Act.
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C. It is duly qualified to carry on its business in the State of
Wisconsin;
D. It is empowered under applicable laws and by its charter and bylaws to
enter into and perform this Agreement;
E. All requisite corporate proceedings have been taken to authorize it to
enter and perform this Agreement;
F. It has and will continue to have access to the necessary facilities,
equipment and personnel to perform its duties and obligations under
this Agreement; and
G. It will comply with all applicable requirements of the Securities Act
of 1933, as amended, and the Exchange Act, the 1940 Act, and any laws,
rules, and regulations of governmental authorities having
jurisdiction.
5. REPRESENTATIONS OF THE COMPANY
The Company represents and warrants to FMFS that:
A. The Company is an open-end investment company under the 1940 Act;
B. The Company is organized, existing, and in good standing under the
laws of Minnesota;
C. The Company is empowered under applicable laws and by its Articles of
Incorporation and Bylaws to enter into and perform this Agreement;
D. All necessary proceedings required by the Articles of Incorporation
have been taken to authorize it to enter into and perform this
Agreement;
E. The Company will comply with all applicable requirements of the
Securities Act, the Exchange Act, the 1940 Act, and any laws, rules
and regulations of governmental authorities having jurisdiction; and
F. A registration statement under the Securities Act will be made
effective and will remain effective, and appropriate state securities
law filings have been made and will continue to be made, with respect
to all shares of the Company being offered for sale.
6. PERFORMANCE OF SERVICE; LIMITATION OF LIABILITY
FMFS shall exercise reasonable care in the performance of its duties under
this Agreement. FMFS shall not be liable for any error of judgment or mistake of
law or for any loss suffered by the Company in connection with matters to which
this Agreement relates, including losses resulting from mechanical breakdowns or
the failure of communication or power supplies beyond FMFS's control, except a
loss arising out of or relating to the refusal or failure to comply
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with the terms of this Agreement or from bad faith, negligence, or willful
misconduct on its part in the performance of its duties under this Agreement.
Notwithstanding any other provision of this Agreement, if FMFS has exercised
reasonable care in the performance of its duties under this Agreement, the
Company shall indemnify and hold harmless FMFS from and against any and all
claims, demands, losses, expenses, and liabilities (whether with or without
basis in fact or law) of any and every nature (including reasonable attorneys'
fees) which FMFS may sustain or incur or which may be asserted against FMFS by
any person arising out of any action taken or omitted to be taken by it in
performing the services hereunder, except for any and all claims, demands,
losses expenses, and liabilities arising out of or relating to FMFS's refusal or
failure to comply with the terms of this Agreement or from bad faith, negligence
or from willful misconduct on its part in performance of its duties under this
Agreement, (i) in accordance with the foregoing standards, or (ii) in reliance
upon any written or oral instruction provided to FMFS by any duly authorized
officer of the Company, such duly authorized officer to be included in a list of
authorized officers furnished to FMFS and as amended from time to time in
writing by resolution of the Board of Directors of the Company.
The Company will indemnify and hold FMFS harmless against any and all
losses, claims, damages, liabilities or expenses (including reasonable counsel
fees and expenses) resulting from any claim, demand, action, or suit as a result
of the negligence of the Company or the principal underwriter (unless
contributed to by FMFS breach of this Agreement or other Agreements between the
Fund and FMFS, or FMFS own negligence or bad faith); or as a result of FMFS
acting upon telephone instructions relating to the exchange or redemption of
shares received by FMFS and reasonably believed by FMFS under a standard of care
customarily used in the industry to have originated from the record owner of the
subject shares; or as a result of acting in reliance upon any genuine instrument
or stock certificate signed, countersigned, or executed by any person or persons
authorized to sign, countersign, or execute the same.
FMFS shall indemnify and hold the Company harmless from and against any and
all claims, demands, losses, expenses, and liabilities (whether with or without
basis in fact or law) of any and every nature (including reasonable attorneys'
fees) which the Company may sustain or incur or which may be asserted against
the Company by any person arising out of any action taken or omitted to be taken
by FMFS as a result of FMFS's refusal or failure to comply with the terms of
this Agreement, its bad faith, negligence, or willful misconduct.
In the event of a mechanical breakdown or failure of communication or power
supplies beyond its control, FMFS shall take all reasonable steps to minimize
service interruptions for any period that such interruption continues beyond
FMFS's control. FMFS will make every reasonable effort to restore any lost or
damaged data and correct any errors resulting from such a breakdown at the
expense of FMFS. FMFS agrees that it shall, at all times, have reasonable
contingency plans with appropriate parties, making reasonable provision for
emergency use of electrical data processing equipment to the extent appropriate
equipment is available. Representatives of the Company shall be entitled to
inspect FMFS's premises and operating capabilities at any time during regular
business hours of FMFS, upon reasonable notice to FMFS.
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Regardless of the above, FMFS reserves the right to reprocess and correct
administrative errors at its own expense.
In order that the indemnification provisions contained in this section
shall apply, it is understood that if in any case the indemnitor may be asked to
indemnify or hold the indemnitee harmless, the indemnitor shall be fully and
promptly advised of all pertinent facts concerning the situation in question,
and it is further understood that the indemnitee will use all reasonable care to
notify the indemnitor promptly concerning any situation which presents or
appears likely to present the probability of a claim for indemnification. The
indemnitor shall have the option to defend the indemnitee against any claim,
which may be the subject of this indemnification. In the event that the
indemnitor so elects, it will so notify the indemnitee and thereupon the
indemnitor shall take over complete defense of the claim, and the indemnitee
shall in such situation initiate no further legal or other expenses for which it
shall seek indemnification under this section. The indemnitee shall in no case
confess any claim or make any compromise in any case in which the indemnitor
will be asked to indemnify the indemnitee except with the indemnitor's prior
written consent.
7. PROPRIETARY AND CONFIDENTIAL INFORMATION
FMFS agrees on behalf of itself and its directors, officers, and employees
to treat confidentially and as proprietary information of the Company all
records and other information relative to the Company and prior, present, or
potential shareholders (and clients of said shareholders) and not to use such
records and information for any purpose other than the performance of its
responsibilities and duties hereunder, except after prior notification to and
approval in writing by the Company, which approval shall not be unreasonably
withheld and may not be withheld where FMFS may be exposed to civil or criminal
contempt proceedings for failure to comply after being requested to divulge such
information by duly constituted authorities, or when so requested by the
Company.
8. TERM OF AGREEMENT
This Agreement shall become effective as of the date hereof and, unless
sooner terminated as provided herein, shall continue automatically in effect for
successive annual periods. The Agreement may be terminated by either party upon
giving ninety (90) days prior written notice to the other party or such shorter
period as is mutually agreed upon by the parties. However, this Agreement may be
amended by mutual written consent of the parties.
9. RECORDS
The Agent shall keep records relating to the services to be performed
hereunder, in the form and manner, and for such period as it may deem advisable
and is agreeable to the Company but not inconsistent with the rules and
regulations of appropriate government authorities, in particular, Section 31 of
The Investment Company Act of 1940 as amended (the "Investment Company Act"),
and the rules thereunder. FMFS agrees that all such records prepared or
maintained by FMFS relating to the services to be performed by FMFS hereunder
are the
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property of the Company and will be preserved, maintained, and made available
with such section and rules of the Investment Company Act and will be promptly
surrendered to the Company on and in accordance with its request.
10. GOVERNING LAW
This Agreement shall be construed and the provisions thereof interpreted
under and in accordance with the laws of the State of Wisconsin. However,
nothing herein shall be construed in a manner inconsistent with the 1940 Act or
any rule or regulation promulgated by the Securities and Exchange Commission
thereunder.
11. DUTIES IN THE EVENT OF TERMINATION
In the event that, in connection with termination, a successor to any
of FMFS's duties or responsibilities hereunder is designated by the Company by
written notice to FMFS, FMFS will promptly, upon such termination and at the
expense of the Company, transfer to such successor all relevant books, records,
correspondence, and other data established or maintained by FMFS under this
Agreement in a form reasonably acceptable to the Company (if such form differs
from the form in which FMFS has maintained, the Company shall pay any expenses
associated with transferring the data to such form), and will cooperate in the
transfer of such duties and responsibilities, including provision for assistance
from FMFS's personnel in the establishment of books, records, and other data by
such successor.
12. NOTICES
Notices of any kind to be given by either party to the other party shall be
in writing and shall be duly given if mailed or delivered as follows: Notice to
FMFS shall be sent to:
Firstar Mutual Fund Services, LLC
Attn: Xxxxx Xxxxxx
000 Xxxx Xxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
and notice to the Funds shall be sent to:
Xxxxx Associates, Inc.
Attn: Xxx Xxxxx
0000 Xxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxxxxxx, XX 00000
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by a duly authorized officer or one or more counterparts as of the day and year
first written above.
XXXXX GROWTH FUND, INC. FIRSTAR MUTUAL FUND SERVICES, LLC
XXXXX FUNDS, INC.
AMERICAN EAGLE FUNDS, INC.
By:______________________________ By: ______________________________
Attest:__________________________ Attest:___________________________
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TRANSFER AGENT AND SHAREHOLDER SERVICING
ANNUAL FEE SCHEDULE
EXHIBIT A
NAME OF SERIES DATE ADDED
-------------- ----------
Xxxxx Growth Fund, Inc. 12/31/99
Xxxxx Growth Fund (Class A, B, C, I)
Xxxxx Funds, Inc. 12/31/99
Xxxxx Opportunity Fund (Class A, B, C, I)
Xxxxx Twenty-Five Fund (Class A, B, C, I)
Xxxxx U. S. Emerging Growth Fund (Class A, B, C, I)
American Eagle Funds, Inc. 12/31/99
American Eagle Capital Appreciation
American Eagle Twenty Fund
Annual Fee
$16.00 per shareholder account
Minimum annual fees of $12,000 per class - Xxxxx Funds
Minimum annual fees of $10,000 per class - American Eagle
Extraordinary services quoted separately.
Conversion estimate (Xxxxx Growth Fund, Inc. and Xxxxx Funds,
Inc.) - $55,000 - $85,000
Activity Charges
Telephone Call - $1.00 per call
Draft Check Processing - $1.00 per draft
Daily Valuation Trades - $6.75 per trade
ACH Shareholder Services
$125.00 per month per fund group
$ .50 per ACH item, setup and/or change
$ 5.00 per correction, reversal, return item
Plus Out-of-Pocket Expenses, including but not limited to:
Telephone - toll free lines Proxies
Postage Retention of records
Programming Microfilm/fiche of records
Programming for select data requests Special reports
Stationery/envelopes ACH fees
Mailing NSCC charges
File transfers - $160.00 per month and $.01 per record
Qualified Plan Fees (Billed to Investors)
Annual maintenance fee per account $12.50 / acct. (Cap at $25.00 per SSN)
Education XXX $ 5.00 / acct. (Cap at $25.00 / per SSN)
Transfer to successor trustee $15.00 / trans.
Distribution to participant $15.00 / trans. (Exclusive of SWP)
Refund of excess contribution $15.00 / trans.
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Additional Shareholder Fees (Billed to Investors)
Any outgoing wire transfer $12.00 / wire
Telephone Exchange $ 5.00 / exchange transaction
Return check fee $25.00 / item
Stop payment $20.00 / stop
(Liquidation, dividend, draft check)
Research fee $ 5.00 / item
(For requested items of the second calendar year [or previous] to the request)(Cap at $25.00)
MISCELLANEOUS
OUT-OF-POCKET CHARGES
NSCC Interfaces
Setup
Fund/SERV, Networking ACATS, Exchanges $5,000 setup (one time)
Commissions $5,000 setup (one time)
Processing
Fund/SERV $ 50.00 / month
Networking $250.00 / month
CPU Access $ 40.00 / month
Fund/SERV Transactions $ .35 / trade
Networking - per item $ .025 / monthly dividend fund
Networking - per item $ .015 / non-mo. dividend fund
First Data $ .10 / next-day Fund/SERV trade
First Data $ .15 / same-day Fund?SERV trade
NSCC Implementation
8 to 10 weeks lead time
DAZL (Direct Access Zip Link - Electronic mail interface to financial advisor
network)
Setup $5,000 / fund group
Monthly Usage $1,000 / month
Transmission $ .015 / price record
$ .025 / other record
Enhancement $ 125 / hour
Forms Costs
Statement Paper $ .038 / item
#9, #10 Envelopes $ .043 / item
Check/Statement Paper $ .25 / item
Certificate $ 1.00 / item
Wire Order Confirm (non-NSCC) $ .22 / item
Presort Postage (one ounce) $ .34 / item
Shareholder System Select Request $200,00/request
Systems Development/Programming $150.00 / hour
Fund Group Additions $2,000.00 / fund group
Lost Shareholder Search (Xxxxx Tracers) $ 3.00 / search
Custom Programming $150.00 / hour
Fees and out-of-pocket expenses are billed to the Funds monthly.
