Exhibit (h)(1)
TRANSFER AGENCY SERVICES AGREEMENT
----------------------------------
THIS AGREEMENT is made as of June 10, 2006 by and among PFPC INC., a
Massachusetts corporation ("PFPC"), and ALLEGIANT ADVANTAGE FUND and ALLEGIANT
FUNDS, both a Massachusetts business trust (each, a "Fund," and together, the
"Funds").
W I T N E S S E T H:
WHEREAS, each Fund is registered as an open-end management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act");
and
WHEREAS, each Fund wishes to retain PFPC to serve as transfer agent,
registrar, dividend disbursing agent and shareholder servicing agent to its
investment portfolios listed on Exhibit A attached hereto and made a part
hereof, as such Exhibit A may be amended from time to time (each a "Portfolio"),
and PFPC wishes to furnish such services.
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, and intending to be legally bound hereby, the parties hereto
agree as follows:
1. DEFINITIONS. As used in this Agreement:
(a) "1933 ACT" means the Securities Act of 1933, as amended.
(b) "1934 ACT" means the Securities Exchange Act of 1934, as amended.
(c) "AUTHORIZED PERSON" means any officer of a Fund and any other person
duly authorized by the Fund's Board of Directors to give Oral
Instructions and Written Instructions on behalf of the Fund. An
Authorized Person's scope of authority may be limited by setting forth
such limitation in a written document signed by the relevant Fund and
PFPC.
(d) "CEA" means the Commodities Exchange Act, as amended.
1
(e) "ORAL INSTRUCTIONS" mean oral instructions received by PFPC from an
Authorized Person or from a person reasonably believed by PFPC to be an
Authorized Person. PFPC may, in its sole discretion in each separate
instance, consider and rely upon instructions it receives from an
Authorized Person via electronic mail as Oral Instructions.
(f) "SEC" means the Securities and Exchange Commission.
(g) "SECURITIES LAWS" mean the 1933 Act, the 1934 Act, the 1940 Act and the
CEA.
(h) "SHARES" mean the shares of beneficial interest of any series or class
of a Fund.
(i) "WRITTEN INSTRUCTIONS" mean (i) written instructions signed by an
Authorized Person and received by PFPC or (ii) trade instructions
transmitted (and received by PFPC) by means of an electronic
transaction reporting system access to which requires use of a password
or other authorized identifier. The instructions may be delivered by
electronically (with respect to sub-item (ii) above) or by hand, mail,
tested telegram, cable, telex or facsimile sending device.
2. APPOINTMENT. Each Fund hereby appoints PFPC to serve as transfer agent,
registrar, dividend disbursing agent and shareholder servicing agent to it in
accordance with the terms set forth in this Agreement. PFPC accepts such
appointment and agrees to furnish such services.
3. COMPLIANCE WITH RULES AND REGULATIONS. PFPC undertakes to comply with
all applicable requirements of the Securities Laws and any laws, rules and
regulations of governmental authorities having jurisdiction with respect to the
duties to be performed by PFPC hereunder. Except as specifically set forth
herein, PFPC assumes no responsibility for such compliance by the Funds, the
Portfolios or any other entity.
2
4. INSTRUCTIONS.
(a) Unless otherwise provided in this Agreement, PFPC shall act only upon
Oral Instructions or Written Instructions.
(b) PFPC shall be entitled to rely upon any Oral Instruction or Written
Instruction it receives from an Authorized Person (or from a person
reasonably believed by PFPC to be an Authorized Person) pursuant to
this Agreement. PFPC may assume that any Oral Instruction or Written
Instruction received hereunder is not in any way inconsistent with the
provisions of a Fund's organizational documents or this Agreement or of
any vote, resolution or proceeding of a Fund's Board of Trustees or of
the Fund's shareholders, unless and until PFPC receives Written
Instructions to the contrary.
(c) Each Fund agrees to forward to PFPC Written Instructions confirming
Oral Instructions so that PFPC receives the Written Instructions by the
close of business on the same day that such Oral Instructions are
received. The fact that such confirming Written Instructions are not
received by PFPC or differ from the Oral Instructions shall in no way
invalidate the transactions or enforceability of the transactions
authorized by the Oral Instructions or PFPC's ability to rely upon such
Oral Instructions.
5. RIGHT TO RECEIVE ADVICE.
(a) ADVICE OF THE FUND. If PFPC is in doubt as to any action it should or
should not take, PFPC may request directions or advice, including Oral
Instructions or Written Instructions, from a Fund.
(b) ADVICE OF COUNSEL. If PFPC shall be in doubt as to any question of law
pertaining to any action it should or should not take, PFPC may request
advice at its own cost (unless, given the matter in question, the
parties agree that such cost should properly be borne by a Fund) from
counsel of its own choosing (who may be counsel for a Fund, a Fund's
investment adviser or PFPC, at the option of PFPC).
3
(c) CONFLICTING ADVICE. In the event of a conflict between directions or
advice or Oral Instructions or Written Instructions PFPC receives from
a Fund, and the advice it receives from counsel, PFPC may rely upon and
follow the advice of counsel. In the event PFPC so relies on the advice
of counsel, it shall be responsible for any action or omission on its
part in carrying out such advice which constitutes willful misfeasance,
bad faith, negligence or reckless disregard by it of any duties,
obligations or responsibilities set forth in this Agreement.
(d) PROTECTION OF PFPC. PFPC shall be indemnified by each Fund and without
liability for any action PFPC takes or does not take in reliance upon
directions or advice or Oral Instructions or Written Instructions PFPC
receives from or on behalf of a Fund or from counsel and which PFPC
believes, in good faith, to be consistent with those directions or
advice or Oral Instructions or Written Instructions. Nothing in this
section shall be construed so as to impose an obligation upon PFPC (i)
to seek such directions or advice or Oral Instructions or Written
Instructions, or (ii) to act in accordance with such directions or
advice or Oral Instructions or Written Instructions unless, under the
terms of other provisions of this Agreement, the same is a condition of
PFPC's properly taking or not taking such action. Nothing in this
subsection shall excuse PFPC when an action or omission on its part in
carrying out such directions, advice, Oral Instructions or Written
Instructions constitutes willful misfeasance, bad faith, negligence or
reckless disregard by PFPC of any duties, obligations or
responsibilities set forth in this Agreement.
6. RECORDS; VISITS. The books and records pertaining to the Funds and the
Portfolios, which are in the possession or under the control of PFPC, shall be
the property of the respective Funds. Such books and records shall be prepared
and maintained as required by the 1940 Act and other applicable laws, rules and
regulations. The Funds and Authorized Persons shall have access to such books
and records at all times during PFPC's normal business hours. Upon the
reasonable request of a Fund, copies of any such books and records shall be
provided by PFPC to the Fund or to an Authorized Person, at the Fund's expense.
4
7. CONFIDENTIALITY.
(a) "Confidential Information" means all information provided by a party
(the "Originating Party") and any of its affiliates to another party
(the "Receiving Party") in connection with this Agreement. Confidential
Information shall include, without limitation: (i) list(s) of customer
names and addresses and other customer-related information, regardless
of whether the Originating Party's relationship with the customer
ceases, including any nonpublic personal information as defined by
federal law, including, but not limited to, the Xxxxx-Xxxxx-Xxxxxx Act,
as it may be amended, any regulations promulgated thereunder and any
other customer information protected by applicable state law; (ii) any
data or information that is competitively sensitive material, and not
generally known to the public, including, but not limited to,
information about product plans, marketing strategies, finances,
operations, customer relationships, customer profiles, customer lists,
sales estimates, business plans, and internal performance results
relating to the past, present or future business activities of a Fund
or PFPC, their respective subsidiaries and affiliated companies and the
customers, clients and suppliers of any of them; (iii) any scientific
or technical information, design, process, procedure, formula, or
improvement that is commercially valuable and secret in the sense that
its confidentiality affords a Fund or PFPC a competitive advantage over
its competitors; (iv) all confidential or proprietary concepts,
documentation, reports, data, specifications, computer software, source
code, object code, flow charts, databases, inventions, know-how, and
trade secrets, whether or not patentable or copyrightable; and (v)
anything designated as confidential. Notwithstanding the foregoing,
information shall not be subject to such confidentiality obligations if
it: (i) is already known to the receiving party at the time it is
obtained; (ii) is or becomes publicly known or available through no
wrongful act of the receiving party; (iii) is rightfully received from
a third party who, to the best of the receiving party's knowledge, is
not under a duty of confidentiality; (iv) is released by the protected
party to a third party without restriction; (v) is required to be
disclosed by the receiving party pursuant to a requirement of a court
order, subpoena, governmental or regulatory agency or law (provided the
receiving party will provide the other party written notice of such
requirement, to the extent such notice is permitted); (vi) is relevant
to the defense of any claim or cause of action asserted against the
receiving party; or (vii) has been or is independently developed or
obtained by the receiving party.
5
(b) All Confidential Information shall be held in the strictest confidence
and will not be disclosed by either party or its representatives,
except as specifically permitted by the terms hereof. Each party and
its respective representatives will use the Confidential Information
solely for the purposes of performing under and in compliance with the
terms of this Agreement, will not use the Confidential Information for
any other purpose, and will not disclose or communicate the
Confidential Information, directly or indirectly, to any third party
except as necessary to carry out the purpose of this Agreement. Each
party further agrees that the Confidential Information will be
disclosed only to such of its representatives who need to examine the
Confidential Information for the purposes described above. Before being
provided with any Confidential Information, each such representative
shall be informed of the confidential nature of the Confidential
Information and shall be directed to treat the Confidential Information
confidentially. Each party shall in any event be responsible for any
breach of this Agreement by any of its representatives.
6
(c) Each party shall take all steps reasonably necessary to keep
confidential the Confidential Information and shall take all steps
reasonably necessary to assure observation of this Agreement by its
representatives. All Confidential Information shall remain the
exclusive property of the Originating Party or its affiliates, as
applicable. Upon request by the Originating Party, the Receiving Party
shall promptly surrender to the Originating Party any of the
Confidential Information in the Receiving Party's possession, and shall
surrender all Confidential Information to the Originating Party
promptly and without request upon the termination of this Agreement.
The Receiving Party will not retain any copies of the Confidential
Information. Notwithstanding the foregoing, the Receiving Party may
retain originals or copies of Confidential Information as is required
for such Receiving Party to comply with applicable laws, rules or
regulations and for customary archival and auditing purposes.
7
(d) In the event that a Receiving Party or any of its representatives is
requested or required (by oral question, interrogatories, requests for
information or documents, subpoenas, civil investigation or similar
process) to disclose any of the Confidential Information, such
Receiving Party will, if permitted by law, provide the Originating
Party and its affiliates with prompt notice of such requests so that
the Originating Party or its affiliates, as applicable, may seek an
appropriate protective order, or if appropriate, waive compliance with
the provisions of this Agreement. The Receiving Party will use
commercially reasonable efforts to obtain or assist the Originating
Party and its affiliates in obtaining such a protective order.
(e) Each of the parties agree that any breach or threatened breach of the
provisions of this Section 7 shall cause immediate and irreparable
injury to the other party for which there exists no adequate remedy at
law. Accordingly, the parties hereby grant each other the right to
appear at any time in any court of law and to obtain an order enjoining
and/or restraining the Receiving Party from using and/or disclosing
such Confidential Information except as such disclosure is permitted in
this Agreement. The parties shall be bound by all provisions of such
protective order and/or any determination of a court of competent
jurisdiction.
(f) The provisions of this Section 7 shall survive termination of this
Agreement.
8. COOPERATION WITH ACCOUNTANTS. PFPC shall cooperate with each Fund's
independent public accountants and shall take all reasonable actions in the
performance of its obligations under this Agreement to ensure that the necessary
information is made available to such accountants for the expression of their
opinion, as required by the relevant Fund.
8
9. PFPC SYSTEM. PFPC shall retain title to and ownership of any and all
data bases, computer programs, screen formats, report formats, interactive
design techniques, derivative works, inventions, discoveries, patentable or
copyrightable matters, concepts, expertise, patents, copyrights, trade secrets,
and other related legal rights utilized by PFPC in connection with the services
provided by PFPC to the Funds. Notwithstanding the foregoing, the parties
acknowledge the Funds shall retain all ownership rights in Fund data which
resides on the PFPC system.
10. DISASTER RECOVERY. PFPC shall enter into and shall maintain in effect
with appropriate parties one or more agreements making reasonable provisions for
emergency use of electronic data processing equipment to the extent appropriate
equipment is available. In the event of equipment failures, PFPC shall, at no
additional expense to a Fund, take reasonable steps to minimize service
interruptions. PFPC shall have no liability with respect to the loss of data or
service interruptions caused by equipment failure, provided such loss or
interruption is not caused by PFPC's own willful misfeasance, bad faith,
negligence or reckless disregard of its duties or obligations under this
Agreement.
11. COMPENSATION.
(a) As compensation for services rendered by PFPC during the term
of this Agreement, each Fund, on behalf of its respective
Portfolios, will pay to PFPC a fee or fees as may be agreed to
from time to time in writing by that Fund and PFPC. In
addition, each Fund agrees to pay, and will be billed
separately in arrears for, reasonable expenses incurred by
PFPC in the performance of its duties hereunder.
(b) PFPC shall establish certain cash management accounts
("Service Accounts") required to provide services under this
Agreement. Each Fund acknowledges (i) investment earnings may
be generated from sweeping the funds in such Service Accounts
into investment accounts including, but not limited,
investment accounts maintained at an affiliate or client of
PFPC ("Sweep Earnings"); (ii) balance credits may be earned
with respect to the amounts in such Service Accounts ("Balance
Credits"); and (iii) PFPC may use the services of third-party
vendors in connection with the issuance of redemption and
distribution checks, which may result in certain benefits such
as commission or return on float paid by any such vendors
("Vendor Earnings").
9
(c) The undersigned hereby represents and warrants to PFPC that
(i) the terms of this Agreement, (ii) the fees and expenses
associated with this Agreement, and (iii) any benefits
accruing to PFPC or to the adviser or sponsor to the Funds in
connection with this Agreement, including but not limited to
any fee waivers, conversion cost reimbursements, up front
payments, signing payments or periodic payments made or to be
made by PFPC to such adviser or sponsor or any affiliate of a
Fund relating to the Agreement have been fully disclosed to
the Board of Trustees of each Fund and that, if required by
applicable law, such Board of Trustees has approved or will
approve the terms of this Agreement, any such fees and
expenses, and any such benefits.
12. INDEMNIFICATION. Each Fund, on behalf of the Portfolios, agrees to
indemnify, defend and hold harmless PFPC and its affiliates, including their
respective officers, directors, agents and employees, from all taxes, charges,
expenses, assessments, claims and liabilities (including, reasonable attorneys'
fees and disbursements and liabilities arising under the Securities Laws and any
state and foreign securities and blue sky laws) arising directly or indirectly
from any action or omission to act which PFPC takes in connection with the
provision of services to a Fund. Neither PFPC, nor any of its affiliates, shall
be indemnified against any liability (or any expenses incident to such
liability) caused by PFPC's or its affiliates' own willful misfeasance, bad
faith, negligence or reckless disregard in the performance of PFPC's activities
under this Agreement, provided that in the absence of a finding to the contrary
the acceptance, processing and/or negotiation of a fraudulent payment for the
purchase of Shares shall be presumed not to have been the result of PFPC's or
its affiliates own willful misfeasance, bad faith, negligence or reckless
disregard of such duties and obligations under this Agreement. Any amounts
payable by a Fund hereunder shall be satisfied only against the relevant
Portfolio's assets and not against the assets of any other investment portfolio
of the Fund.
The provisions of this Section 12 shall survive termination of this Agreement.
10
13. RESPONSIBILITY OF PFPC.
(a) PFPC shall be under no duty to take any action hereunder on behalf of a
Fund or any Portfolio except as specifically set forth herein or as may
be specifically agreed to by PFPC and the relevant Fund in a written
amendment hereto. PFPC shall be obligated to exercise care and
diligence in the performance of its duties hereunder and to act in good
faith in performing services provided for under this Agreement. PFPC
shall be liable only for any damages arising out of PFPC's failure to
perform its duties under this Agreement to the extent such damages
arise out of PFPC's willful misfeasance, bad faith, negligence or
reckless disregard of such duties.
(b) Notwithstanding anything in this Agreement to the contrary, (i) PFPC
shall not be liable for losses, delays, failure, errors, interruption
or loss of data occurring directly or indirectly by reason of
circumstances beyond its reasonable control (provided PFPC has acted in
accordance with the standard of care set forth above), including
without limitation acts of God; action or inaction of civil or military
authority; public enemy; war; terrorism; riot; fire; flood; sabotage;
epidemics; labor disputes; civil commotion; interruption, loss or
malfunction of utilities, transportation, computer or communications
capabilities; insurrection; elements of nature; or non-performance by a
third party; and (ii) PFPC shall not be under any duty or obligation to
inquire into and shall not be liable for the validity or invalidity,
authority or lack thereof, or truthfulness or accuracy or lack thereof,
of any instruction, direction, notice, instrument or other information
which PFPC reasonably believes to be genuine.
11
(c) Notwithstanding anything in this Agreement to the contrary, neither
PFPC nor its affiliates shall be liable for any consequential, special
or indirect losses or damages, whether or not the likelihood of such
losses or damages was known by PFPC or its affiliates.
(d) Any claims (including the filing of a suit or, if applicable,
commencement of arbitration proceedings) must be asserted by a Fund
against PFPC or any of its affiliates within 24 months after the Fund
became aware of the claim or the Board of Trustees of the Fund is
informed of specific facts that should have alerted it that a basis for
such a claim might exist.
(e) Each party shall have a duty to mitigate damages for which another
party may become responsible.
(f) Notwithstanding anything in this Agreement to the contrary, PFPC shall
have no liability for any error or omission of any predecessor service
provider(s) to the Funds or for any failure to discover any such error
or omission.
(g) The provisions of this Section 13 shall survive termination of this
Agreement.
12
14. DESCRIPTION OF SERVICES.
(a) SERVICES PROVIDED ON AN ONGOING BASIS. PFPC will perform the following
services on an ongoing basis (as applicable):
(i) Calculate 12b-1 payments;
(ii) Maintain shareholder registrations;
(iii) Review new applications and correspond with shareholders to
complete or correct information;
(iv) Direct payment processing of checks or wires;
(v) Prepare and certify stockholder lists in conjunction with
proxy solicitations;
(vi) Prepare and mail to shareholders confirmation of activity;
(vii) Maintain toll-free lines for direct shareholder use, plus
customer liaison staff for inquiry response;
(viii) Mail duplicate confirmations to broker-dealers of their
clients' activity, whether executed through the broker-dealer
or directly with the underwriter;
(ix) Provide periodic shareholder lists and statistics to the
Funds;
(x) Prepare periodic mailing of year-end tax and statement
information;
(xi) Notify on a timely basis the investment adviser, accounting
agent, and custodian of fund activity;
(xii) Perform other broker-dealer or shareholder services as may be
agreed upon from time to time;
(xiii) Accept and post daily Share purchases and redemptions;
(xiv) Accept, post and perform shareholder transfers and exchanges;
and
(xv) Perform certain administrative and ministerial duties relating
to opening, maintaining and processing transactions for
shareholders or financial intermediaries that trade shares
through the NSCC.
(b) PURCHASE OF SHARES. PFPC shall issue and credit an account of an
investor, in the manner described in the Fund's prospectus, once it
receives:
13
(i) A purchase order in completed proper form;
(ii) Proper information to establish a shareholder account; and
(iii) Confirmation of receipt or crediting of funds for such order
to each Fund's custodian (the "Custodian").
(c) REDEMPTION OF SHARES. PFPC shall process requests to redeem Shares as
follows:
(i) All requests to transfer or redeem Shares and payment therefor
shall be made in accordance with the relevant Fund's
prospectus, when the shareholder tenders Shares in proper
form, accompanied by such documents as PFPC reasonably may
deem necessary.
(ii) PFPC reserves the right to refuse to transfer or redeem Shares
until it is satisfied that the endorsement on the instructions
is valid and genuine and that the requested transfer or
redemption is legally authorized, and it shall incur no
liability for the refusal, in good faith, to process transfers
or redemptions which PFPC, in its good judgment, deems
improper or unauthorized, or until it is reasonably satisfied
that there is no basis to any claims adverse to such transfer
or redemption.
(iii) When Shares are redeemed, PFPC shall deliver to the relevant
Fund's Custodian and the Fund or its designee a notification
setting forth the dollar amount of Shares redeemed. Such
redeemed Shares shall be reflected on appropriate accounts
maintained by PFPC reflecting outstanding Shares of the Fund
and Shares attributed to individual accounts.
14
(iv) PFPC shall, upon receipt of the monies provided to it by the
Custodian for the redemption of Shares, pay such monies as are
received from the Custodian, all in accordance with the
procedures established from time to time between PFPC and the
relevant Fund.
(v) When a broker-dealer notifies PFPC of a redemption desired by
a customer, and the Custodian provides PFPC with funds, PFPC
shall prepare and send the redemption check to the
broker-dealer and made payable to the broker-dealer on behalf
of its customer, unless otherwise instructed in writing by the
broker-dealer.
(vi) PFPC shall not process or effect any redemption requests with
respect to Shares of the Funds after receipt by PFPC or its
agent of notification of the suspension of the determination
of the net asset value of the Funds.
(d) DIVIDENDS AND DISTRIBUTIONS. Upon a resolution of a Fund's Board of
Trustees, and Written Instructions to PFPC at least one business day
before any record date, authorizing the declaration and payment of
dividends and distributions, PFPC shall issue dividends and
distributions declared by the relevant Fund in Shares, or, upon
shareholder election, pay such dividends and distributions in cash, if
provided for in that Fund's prospectus. In all cases the ex- and
payable date shall be one business day after the record date. Such
issuance or payment, as well as payments upon redemption as described
above, shall be made after deduction and payment of the required amount
of funds to be withheld in accordance with any applicable tax laws or
other laws, rules or regulations. PFPC shall mail to each Fund's
shareholders such tax forms and other information, or permissible
substitute notice, relating to dividends and distributions paid by the
relevant Fund as are required to be filed and mailed by applicable law,
rule or regulation. PFPC shall prepare, maintain and file with the IRS
and other appropriate taxing authorities reports relating to all
dividends above a stipulated amount paid by a Fund to its shareholders
as required by tax or other law, rule or regulation.
15
(e) SHAREHOLDER ACCOUNT SERVICES.
(i) PFPC may arrange, in accordance with the prospectus, for
issuance of Shares obtained through:
- Any pre-authorized check plan;
- Direct purchases through checks and applications; and
- ACH and wire transfers.
(ii) PFPC may arrange, in accordance with the prospectus, for a
shareholder's:
- Exchange of Shares for shares of another fund with
which the Funds have exchange privileges;
- Automatic redemption from an account where that
shareholder participates in a automatic redemption
plan; and/or
- Redemption of Shares from an account with a
checkwriting privilege.
(f) COMMUNICATIONS TO SHAREHOLDERS. Upon timely Written Instructions, and
at the expense of the Fund, PFPC shall mail all communications by a
Fund to its shareholders, including:
(i) Reports to shareholders;
(ii) Confirmations of purchases and sales of Fund shares;
(iii) Monthly or quarterly and annual statements;
(iv) Dividend and distribution notices; and
(v) Tax form information.
(g) RECORDS. PFPC shall maintain records of the accounts for each
shareholder showing the following information:
(i) Name, address and United States Tax Identification or Social
Security number;
(ii) Number and class of Shares held;
(iii) Historical information regarding the account of each
shareholder, including dividends and distributions paid and
the date and price for all transactions on a shareholder's
account;
16
(iv) Any stop or restraining order placed against a shareholder's
account;
(v) Any correspondence relating to the current maintenance of a
shareholder's account;
(vi) Information with respect to withholdings; and
(vii) Any information required in order for PFPC to perform any
calculations required by this Agreement.
(h) LOST SHAREHOLDERS. PFPC shall perform such services as are required in
order to comply with rule 17Ad-17 of the 1934 Act (the "Lost
Shareholder Rule"), including, but not limited to, those set forth
below. PFPC may, in its sole discretion, use the services of a third
party to perform some of or all such services.
(i) documentation of search policies and procedures;
(ii) execution of required searches;
(iii) tracking results and maintaining data sufficient to comply
with the Lost Shareholder Rule; and
(iv) preparation and submission of data required under the Lost
Shareholder Rule.
Except as set forth above, PFPC shall have no responsibility for any
escheatment services.
(i) RETIREMENT PLANS.
(i) In connection with the individual retirement accounts,
simplified employee pension plans, rollover individual
retirement plans, educational IRA's and XXXX individual
retirement accounts ("XXX Plans"), 403(b) Plans and money
purchase and profit sharing plans ("Qualified Plans")
(collectively, the "Retirement Plans") within the meaning of
Section 408 of the Internal Revenue Code of 1986, as amended
(the "Code") sponsored by the Funds for which contributions of
the Fund's shareholders (the "Participants") are invested
solely in Shares of the Funds, PFPC shall provide the
following administrative services:
(A) Establish a record of types and reasons for
distributions (i.e., attainment of age 59-1/2,
disability, death, return of excess contributions,
etc.);
17
(B) Record method of distribution requested and/or made;
(C) Receive and process designation of beneficiary forms
requests;
(D) Examine and process requests for direct transfers
between custodians/trustees, transfer and pay over to
the successor assets in the account and records
pertaining thereto as requested;
(E) Prepare any annual reports or returns required to be
prepared and/or filed by a custodian of a Retirement
Plan, including, but not limited to, an annual fair
market value report, Forms 1099R and 5498; and file
same with the IRS and provide same to
Participant/Beneficiary, as applicable;
(F) Perform applicable federal withholding and send
Participants/Beneficiaries an annual TEFRA notice
regarding required federal tax withholding; and
(G) Perform applicable state withholding if so instructed
by a Fund.
(ii) PFPC shall arrange for PFPC Trust Company to serve as
custodian for the Retirement Plans sponsored by the Funds.
(iii) With respect to the Retirement Plans, PFPC shall provide the
Funds with the associated Retirement Plan documents for use by
the Funds and PFPC shall be responsible for the maintenance of
such documents in compliance with all applicable provisions of
the Code and the regulations promulgated thereunder.
(j) PRINT MAIL. Each Fund hereby engages PFPC as its exclusive print/mail
service provider with respect to those items and for such fees as may
be agreed to from time to time in writing by that Fund and PFPC.
(k) PROXY ADVANTAGE. Each Fund hereby engages PFPC as its exclusive proxy
solicitation service provider with respect to those items and for such
fees as may be agreed to from time to time in writing by that Fund and
PFPC.
(l) INTERNET ACCOUNT MANAGEMENT SERVICES. PFPC shall provide to each Fund
the services specified in Exhibit B attached hereto and made a part
hereof, subject to and in accordance with the terms set forth in such
Exhibit B, as such Exhibit B may be amended from time to time.
18
15. PRIVACY. Each party hereto acknowledges and agrees that, subject to the
reuse and re-disclosure provisions of Xxxxxxxxxx X-X, 00 XXX Part
248.11, it shall not disclose the non-public personal information of
investors in the Fund obtained under this Agreement, except as
necessary to carry out the services set forth in this Agreement or as
otherwise permitted by law or regulation.
16. ANTI-MONEY LAUNDERING. To the extent the other provisions of this
Agreement require PFPC to establish, maintain and monitor accounts of
investors in a Fund consistent with securities laws, PFPC shall perform
reasonable actions necessary to help the Fund be in compliance with
Section 352 of the USA PATRIOT Act, as follows: In this regard, PFPC
shall: (a) establish and implement written internal policies,
procedures and controls reasonably designed to help prevent the Funds
from being used to launder money or finance terrorist activities; (b)
provide for independent testing, by an employee who is not responsible
for the operation of PFPC's AML program or by an outside party, for
compliance with PFPC's established policies and procedures; (c)
designate a person or persons responsible for implementing and
monitoring the operation and internal controls of PFPC's AML program;
and (d) provide ongoing training of PFPC personnel relating to the
prevention of money-laundering activities. Upon the reasonable request
of a Fund, PFPC shall provide to the Fund: (x) a copy of PFPC's written
AML policies and procedures (it being understood such information is to
be considered confidential and treated as such and afforded all
protections provided to confidential information under this Agreement);
(y) at the option of PFPC, a copy of a written assessment or report
prepared by the party performing the independent testing for
compliance, or a summary thereof, or a certification that the findings
of the independent party are satisfactory; and (z) a summary of the AML
training provided for appropriate personnel. PFPC agrees to permit
inspections relating to its AML program by U.S. Federal departments or
regulatory agencies with appropriate jurisdiction and to make available
to examiners from such departments or regulatory agencies such
information and records relating to its AML program as such examiners
shall reasonably request. Without limiting or expanding the foregoing,
the parties agree the provisions herein do not apply to Section 326 of
the USA PATRIOT Act (or other sections other than Section 352) or
regulations promulgated thereunder.
19
17. CUSTOMER IDENTIFICATION PROGRAM ("CIP") SERVICES.
(a) To help each Fund comply with its Customer Identification Program
(which the Fund is required to have under regulations issued under
Section 326 of the USA PATRIOT Act) PFPC will do the following:
(i) Implement procedures under which new accounts in the Fund are
not established unless PFPC has obtained the name, date of
birth (for natural persons only), street address and
government-issued identification number (collectively, the
"Data Elements") for each corresponding Customer (as defined
in 31 CFR 103.131).
(ii) Use collected Data Elements to attempt to reasonably verify
the identity of each new Customer promptly before or after
each corresponding new account is opened. Methods may consist
of non-documentary methods (for which PFPC may use
unaffiliated information vendors to assist with such
verifications) and documentary methods (as permitted by 31 CFR
103.131), and may include procedures under which PFPC
personnel perform enhanced due diligence to verify the
identities of Customers the identities of whom were not
successfully verified through the first-level (which will
typically be reliance on results obtained from an information
vendor) verification process(es).
(iii) Record the Data Elements and maintain records relating to
verification of new Customers consistent with 31 CFR
103.131(b)(3).
(iv) Regularly report to the Funds about measures taken under
(a)-(c) above.
(v) If PFPC provides services by which prospective Customers may
subscribe for shares in the Funds via the Internet or
telephone, work with the Funds to notify prospective
Customers, consistent with 31 CFR 103.(b)(5), about the Funds'
CIP.
20
(vi) Set forth on a separate fee schedule compensation amounts due
for these CIP Services.
(b) Notwithstanding anything to the contrary, and without expanding the
scope of the express language above, PFPC need not collect the Data
Elements for (or verify) prospective customer (or accounts) beyond the
requirements of relevant regulation (for example, PFPC will not verify
customers opening accounts through NSCC) and PFPC need not perform any
task that need not be performed for the Funds to be in compliance with
relevant regulation.
(c) Notwithstanding anything to the contrary, PFPC need not perform any of
the steps described above with respect to persons purchasing Shares via
exchange privileges.
18. DURATION AND TERMINATION.
(a) This Agreement shall be effective on the date first above
written and shall continue until August 31, 2009 (the "Initial
Term"). Thereafter, this Agreement shall continue
automatically for successive terms of one (1) year (each, a
"Renewal Term"); provided however, that this Agreement may be
terminated at the end of the Initial Term or any subsequent
date by the Funds or by PFPC on ninety (90) days' prior
written notice to the other. In the event a Fund gives notice
of termination, all reasonable expenses associated with
movement (or duplication) of records and materials and
conversion thereof to a successor service provider(s), and all
reasonable and directly related trailing expenses incurred by
PFPC, will be borne by that Fund. In the event one Fund
terminates this Agreement, this Agreement shall remain in full
force and effect with respect to the other Fund until this
Agreement is terminated in accordance with its terms.
21
(b) If a party hereto fails in any material respect to perform its
duties and obligations hereunder (a "Defaulting Party"), the
other party (the "Non-Defaulting Party") may give written
notice thereof to the Defaulting Party, and if such material
breach shall not have been remedied within thirty (30) days
after such written notice is given, then the Non-Defaulting
Party may terminate this Agreement by giving thirty (30) days
written notice of such termination to the Defaulting Party.
Termination of this Agreement by the Non-Defaulting Party
shall not constitute a waiver of any other rights or remedies
with respect to obligations of the parties prior to such
termination or rights of PFPC to be reimbursed for
out-of-pocket expenses. In all cases, termination by the
Non-Defaulting Party shall not constitute a waiver by the
Non-Defaulting Party of any other rights it might have under
this Agreement or otherwise against the Defaulting Party.
(c) Notwithstanding anything contained in this Agreement to the
contrary, if the Fund is liquidated (a "LIQUIDATION") or the
Fund's or one or more Portfolio(s)' assets are merged or
purchased or the like with or by another entity that does not
use the services of PFPC (a "REORGANIZATION") after the first
year of this Agreement, the Fund may terminate this Agreement
with respect to the Fund or such Portfolio(s), as applicable,
at any time after the occurrence of such Liquidation or
Reorganization event by the Board of Trustees of the Fund on
90 days' written notice to PFPC. In such case, if the Fund
elects to terminate this Agreement as a result of a
Liquidation or with respect to such Portfolio(s) involved in a
Reorganization, the Fund shall pay PFPC an amount equal to a
"multiplier" times the greater of (x) the monthly average fees
due to PFPC under this Agreement during the last three whole
months prior to the Liquidation or Reorganization, as
applicable, for providing services to the terminating
Portfolio(s) or (y) the monthly average fees paid to PFPC for
providing services to the terminating Portfolio(s) during the
last three whole months prior to delivery of the notice of
termination. The "Multiplier" will equal the number of months
remaining in the Agreement at the time that PFPC is no longer
providing services to the terminating Portfolio(s) under this
Agreement divided by three.
22
(d) For clarification, if this Agreement is terminated with
respect to less than all of the Portfolios, this Agreement
will remain in full force and effect with respect to all of
the remaining Portfolios.
19. NOTICES. Notices shall be addressed (a) if to PFPC, at 000 Xxxxxxxx
Xxxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000, Attention: President (or such
other address as PFPC may inform the Fund in writing); (b) if to the
Funds, at 000 Xxxxxx Xxxxxx, 0xx Xxxxx, Xxxxxxxxx, XX 00000, Attention:
Xxxxxxxx X. Xxxx; with copies to Drinker Xxxxxx & Xxxxx LLP, One Xxxxx
Square, 00xx xxx Xxxxxx Xxxxxxx, Xxxxxxxxxxxx, XX 00000, Attention:
Xxxxxx X. Xxxxxx, Esq.; or (c) if to neither of the foregoing, at such
other address as shall have been given by like notice to the sender of
any such notice or other communication by the other parties. If notice
is sent by confirming telegram, cable, telex or facsimile sending
device, it shall be deemed to have been given immediately. If notice is
sent by first-class mail, it shall be deemed to have been given three
days after it has been mailed. If notice is sent by messenger, it shall
be deemed to have been given on the day it is delivered.
20. AMENDMENTS. This Agreement, or any term thereof, may be changed or
waived only by a written amendment, signed by the party against whom
enforcement of such change or waiver is sought.
23
21. DELEGATION; ASSIGNMENT. PFPC may assign its rights hereunder to any
majority-owned direct or indirect subsidiary of PFPC or of The PNC
Financial Services Group, Inc., provided that (i) PFPC gives the Funds
at least 30 days' prior written notice of such assignment, (ii) the
assignee agrees to comply with the relevant provisions of the 1940 Act,
and (iii) PFPC and such assignee promptly provides such information as
the Funds may reasonably request and respond to such questions as the
Funds may reasonably ask, relative to the assignment or delegation
(including, without limitation, the capabilities of the assignee or
delegate). To the extent required by the rules and regulations of the
NSCC and in order for PFPC to perform the NSCC-related services, the
Fund agrees that PFPC may delegate its duties to any affiliate of PFPC
that is a member of the NSCC.
22. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
23. FURTHER ACTIONS. Each party agrees to perform such further acts and
execute such further documents as are necessary to effectuate the
purposes hereof.
24. MISCELLANEOUS.
(a) ENTIRE AGREEMENT. This Agreement embodies the entire agreement and
understanding between the parties and supersedes all prior agreements
and understandings relating to the subject matter hereof, provided that
the parties may embody in one or more separate documents their
agreement, if any, with respect to delegated duties.
(b) NO CHANGES THAT MATERIALLY AFFECT OBLIGATIONS. Notwithstanding anything
in this Agreement to the contrary, each Fund agrees not to make any
modifications to its registration statement or adopt any policies which
would affect materially the obligations or responsibilities of PFPC
hereunder without the prior written approval of PFPC, which approval
shall not be unreasonably withheld or delayed.
24
(c) CAPTIONS. The captions in this Agreement are included for convenience
of reference only and in no way define or delimit any of the provisions
hereof or otherwise affect their construction or effect.
(d) INFORMATION. Each Fund will provide such information and documentation
as PFPC may reasonably request in connection with services provided by
PFPC to the Funds.
(e) GOVERNING LAW. This Agreement shall be deemed to be a contract made in
Delaware and governed by Delaware law, without regard to principles of
conflicts of law.
(f) PARTIAL INVALIDITY. If any provision of this Agreement shall be held or
made invalid by a court decision, statute, rule or otherwise, the
remainder of this Agreement shall not be affected thereby.
(g) SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their respective
successors and permitted assigns.
(h) NO REPRESENTATIONS OR WARRANTIES. Except as expressly provided in this
Agreement, PFPC hereby disclaims all representations and warranties,
express or implied, made to the Fund or any other person, including,
without limitation, any warranties regarding quality, suitability,
merchantability, fitness for a particular purpose or otherwise
(irrespective of any course of dealing, custom or usage of trade), of
any services or any goods provided incidental to services provided
under this Agreement. PFPC disclaims any warranty of title or
non-infringement except as otherwise set forth in this Agreement.
(i) FACSIMILE SIGNATURES. The facsimile signature of any party to this
Agreement shall constitute the valid and binding execution hereof by
such party.
25
(j) CUSTOMER IDENTIFICATION PROGRAM NOTICE. To help the U.S. government
fight the funding of terrorism and money laundering activities, U.S.
Federal law requires each financial institution to obtain, verify, and
record certain information that identifies each person who initially
opens an account with that financial institution on or after October 1,
2003. Certain of PFPC's affiliates are financial institutions, and PFPC
may, as a matter of policy, request (or may have already requested)
each Fund's name, address and taxpayer identification number or other
government-issued identification number, and, if such party is a
natural person, that party's date of birth. PFPC may also ask (and may
have already asked) for additional identifying information, and PFPC
may take steps (and may have already taken steps) to verify the
authenticity and accuracy of these data elements.
(k) BUSINESS TRUST. The names "Allegiant Funds" and "Allegiant Advantage
Fund" and of any investment portfolio thereof, and any reference to the
"Trustees" of Allegiant Funds and Allegiant Advantage Fund, refer
respectively to the Trusts created and the Trustees, as trustees but
not individually or personally, acting from time to time under the
Declarations of Trust which are hereby referred to and copies of which
is on file at the office of the State Secretary of the Commonwealth of
Massachusetts and at the principal offices of the Trusts. The
obligations of Allegiant Funds and Allegiant Advantage Fund entered
into in its name, or on behalf of any of its investment portfolios, or
on behalf thereof by any of its Trustees, representatives or agents,
are made not individually, but in such capacities, and are not binding
upon any of the Trustees, shareholders or representatives of the
respective Trust personally, but bind only the relevant Trust's
property, and all persons dealing with any class of shares of a Trust
must look solely to that Trust property belonging to such class for the
enforcement of any claims against that Trust.
26
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and year first above written.
PFPC INC.
By: /s/ XXXXX X. XXXXXX
--------------------------------
Name: Xxxxx X. Xxxxxx
Title: Senior Vice President
ALLEGIANT ADVANTAGE FUND
By: /s/ XXXXXXXX X. XXXX
--------------------------------
Name: Xxxxxxxx X. Xxxx
Title: Chief Administrative Officer
ALLEGIANT FUNDS
By: /s/ XXXXXXXX X. XXXX
--------------------------------
Name: Xxxxxxxx X. Xxxx
Title: Chief Administrative Officer
27
EXHIBIT A
THIS EXHIBIT A, dated as of June 10, 2006, is Exhibit A to that certain
Transfer Agency Services Agreement dated as of June 10, 2006, among PFPC Inc.
and Allegiant Funds and Allegiant Advantage Fund.
ALLEGIANT FUNDS
ALLEGIANT INTERMEDIATE TAX EXEMPT BOND FUND
ALLEGIANT INTERMEDIATE BOND FUND
ALLEGIANT OHIO INTERMEDIATE TAX EXEMPT BOND FUND
ALLEGIANT LIMITED MATURITY BOND FUND
ALLEGIANT TOTAL RETURN ADVANTAGE FUND
ALLEGIANT PENNSYLVANIA INTERMEDIATE MUNICIPAL BOND FUND
ALLEGIANT BOND FUND
ALLEGIANT GOVERNMENT MORTGAGE FUND
ALLEGIANT MICHIGAN INTERMEDIATE MUNICIPAL BOND FUND
ALLEGIANT ULTRA SHORT BOND FUND
ALLEGIANT S&P 500 INDEX FUND
ALLEGIANT BALANCED ALLOCATION FUND
ALLEGIANT LARGE CAP GROWTH FUND
ALLEGIANT LARGE CAP VALUE FUND
ALLGNT MULTI-FACTOR SMALL CAP VALUE FUND
ALLEGIANT INTERNATIONAL EQUITY FUND
ALLEGIANT SMALL CAP GROWTH FUND
ALLEGIANT LARGE CAP CORE EQUITY FUND
ALLEGIANT MID CAP GROWTH FUND
ALLEGIANT AGGRESSIVE ALLOCATION FUND
ALLEGIANT CONSERVATIVE ALLOCATION FUND
ALLEGIANT MID CAP VALUE FUND
ALLEGIANT SMALL CAP CORE FUND
ALLEGIANT MULTI-FACTOR SMALL CAP CORE FUND
ALLEGIANT MULTI-FACTOR SMALL CAP GROWTH FUND
ALLEGIANT MULTI-FACTOR SMALL CAP FOCUSED VALUE FUND
ALLEGIANT OHIO MUNICIPAL MONEY MARKET FUND
ALLEGIANT TREASURY MONEY MARKET FUND
ALLEGIANT MONEY MARKET FUND
28
ALLEGIANT GOVERNMENT MONEY MARKET FUND
ALLEGIANT TAX EXEMPT MONEY MARKET FUND
ALLEGIANT PENNSYLVANIA TAX EXEMPT MONEY MARKET FUND
ALLEGIANT ADVANTAGE FUND
Institutional Money Market Fund
29
EXHIBIT B
INTERNET ACCOUNT MANAGEMENT SERVICES
1. DEFINITIONS. Any term not herein defined in this Exhibit B shall have the
meaning given such term in the Agreement. The following definitions shall apply
to this Exhibit B:
(a) "End-User" shall mean any Shareholder that accesses the PFPC System
via Internet Account Management.
(b) "Fund Web Site" means the collection of electronic documents,
electronic files and pages residing on any computer system(s) maintained on
behalf of a Fund, connected to the Internet and accessible by hypertext link
through the World Wide Web to and from Internet Account Management.
(c) "Internet Account Management Services" means the services
identified in Section 2 hereof to be provided by PFPC utilizing the Fund Web
Site, the Internet and certain software, equipment and systems provided by PFPC,
telecommunications carriers and security providers which have been certified by
ICSA or a nationally-recognized audit firm (including but not limited to
firewalls and encryption), whereby Inquires may be performed and Transactions
may be requested by accessing Internet Account Management via hypertext link
from the Fund Web Site.
(d) "Inquiry" shall mean any access to the PFPC System via Internet
Account Management initiated by an End-User which is not a Transaction.
(e) "Internet" shall mean the communications network comprised of
multiple communications networks linking education, government, industrial and
private computer networks.
(f) "Internet Account Management" means the collection of electronic
documents, electronic files and pages residing on PFPC's computer system(s) (or
those elements of the computer system of one or more Internet Service Providers
("ISPs") retained by PFPC and necessary for PFPC's services hereunder),
connected to the Internet and accessible by hypertext link from the Fund Web
Site through the World Wide Web, where the Inquiry and Transaction data fields
and related screens provided by PFPC may be viewed.
(g) "Shareholder" means the record owner or authorized agent of the
record owner of shares of a Fund.
(h) "Transaction" shall mean purchase, redemption, exchange or any
other activity involving the movement of Shares initiated by an End-User.
30
2. PFPC RESPONSIBILITIES. Subject to the provisions of this Exhibit B,
PFPC shall provide or perform, or shall retain other persons to provide or
perform, the following, at PFPC's expense (unless otherwise provided herein):
(a) provide all computers, telecommunications equipment, encryption
technology and other materials and services reasonably necessary to develop and
maintain Internet Account Management to permit persons to be able to view
information about a Fund and to permit End-Users with appropriate identification
and access codes to perform Inquiries and initiate Transactions;
(b) address and mail, at a Fund's expense, notification and promotional
mailings and other communications provided by a Fund to Shareholders regarding
the availability of Internet Account Management Services;
(c) prepare and process new account applications received through
Internet Account Management from Shareholders determined by a Fund to be
eligible for such services and in connection with such, a Fund agrees as
follows:
(i) to permit the establishment of Shareholder bank account
information over the Internet in order to facilitate purchase
activity through the Automated Clearing House ("ACH");
(ii) the ACH prenote process will be waived and the ACH status will
be set to active; and
(iii) a Fund shall be responsible for any resulting gain/loss
liability associated with the ACH process.
(d) process the set up of user ID and password, as described in the
Internet Account Management Product Guide provided to a Fund, which shall
include verification of initial user registration of user ID and password
maintaining, changing and forgot password, as well as maintaining user ID
security profile;
(e) provide installation services which shall include, review and
approval of a Fund's network requirements, recommending method of establishing
(and, as applicable, cooperate with a Fund to implement and maintain) a
hypertext link between Internet Account Management and the Fund Web Site and
testing the network connectivity and performance;
(f) establish systems to guide, assist and permit End-Users who access
Internet Account Management from the Fund Web Site to electronically perform
Inquires and create and transmit Transaction requests to PFPC;
(f) deliver to a Fund one (1) copy of the PFPC Internet Account
Management Product Guide, as well as all updates thereto on a timely basis;
31
(g) deliver a monthly billing report to a Fund, which shall include a
report of Inquiries and Transactions;
(h) provide a form of encryption that is generally available to the
public in the U.S. for standard Internet browsers and establish, monitor and
verify firewalls and other security features (commercially reasonable for this
type of information and data) and exercise commercially reasonable efforts to
attempt to maintain the security and integrity of Internet Account Management;
(i) exercise reasonable efforts to maintain all on-screen disclaimers
and copyright, trademark and service xxxx notifications, if any, provided by a
Fund to PFPC in writing from time to time, and all "point and click" features of
Internet Account Management relating to Shareholder acknowledgment and
acceptance of such disclaimers and notifications;
(j) provide periodic site visitation (hit reports) and other
information regarding End-User activity under this Exhibit B as agreed by PFPC
and a Fund from time to time;
(k) monitor the telephone lines involved in providing Internet Account
Management Services and inform a Fund promptly of any malfunctions or service
interruptions;
(l) periodically scan PFPC's Internet interfaces and Internet Account
Management for viruses and promptly remove any such viruses located thereon; and
(m) maintenance and support of Internet Account Management, which
includes providing error corrections, minor enhancements and interim upgrades to
Internet Account Management which are made generally available to Internet
Account Management customers and providing help desk support to provide
assistance to Fund employees with a Fund's use of Internet Account Management;
maintenance and support shall NOT include (i) access to or use of any
substantial added functionality, new interfaces, new architecture, new
platforms, new versions or major development efforts, unless made generally
available by PFPC to Internet Account Management clients, as determined solely
by PFPC; or (ii) maintenance of customized features.
Notwithstanding anything in this Exhibit B or the Agreement to the
contrary, a Fund recognizes and acknowledges that (i) a logon I.D. and password
are required by End-Users to access PFPC's Internet Account Management; (ii)
End-User's Web Browser and ISP must support Secure Sockets Layer (SSL)
encryption technology; and (iii) PFPC will not provide any software for access
to the Internet; software must be acquired from a third-party vendor.
3. FUND RESPONSIBILITIES. Subject to the provisions of this Exhibit B
and the Agreement, a Fund shall at its expense (unless otherwise provided
herein):
(a) provide, or retain other persons to provide, all computers,
telecommunications equipment, encryption technology and other materials,
services, equipment and software reasonably necessary to develop and maintain
the Fund Web Site, including the functionality necessary to maintain the
hypertext links to Internet Account Management;
32
(b) promptly provide PFPC written notice of changes in Fund policies or
procedures requiring changes to the Internet Account Management Services;
(c) work with PFPC to develop Internet marketing materials for
End-Users and forward a copy of appropriate marketing materials to PFPC;
(d) revise and update the applicable prospectus(es) and other pertinent
materials, such as user agreements with End-Users, to include the appropriate
consents, notices and disclosures for Internet Account Management Services,
including disclaimers and information reasonably requested by PFPC;
(e) maintain all on-screen disclaimers and copyright, trademark and
service xxxx notifications, if any, provided by PFPC to a Fund in writing from
time to time, and all "point and click" features of the Fund Web Site relating
to acknowledgment and acceptance of such disclaimers and notifications; and
(f) design and develop the Fund Web Site functionality necessary to
facilitate, implement and maintain the hypertext links to Internet Account
Management and the various Inquiry and Transaction web pages and otherwise make
the Fund Web Site available to End-Users.
4. STANDARDS OF CARE FOR INTERNET SERVICES.
(a) Notwithstanding anything in the Agreement or this Exhibit B to the
contrary (other than as set forth in the immediately succeeding sentence) with
respect to the provision of services set forth in this Exhibit B (i) PFPC shall
be liable only for its own willful misfeasance, bad faith, negligence or
reckless disregard in the provision of such services and (ii) a Fund shall
indemnify, defend and hold harmless PFPC and its affiliates (including their
respective officers, directors, agents and employees) from all taxes, charges,
expenses, assessments, claims and liabilities (including reasonable attorneys'
fees and disbursements and liabilities arising under the Securities Laws and any
state and foreign securities and blue sky laws) incurred by such indemnified
parties with respect to such services except for those for which PFPC is liable
under sub-clause (i) of this sentence. For clarity, the provisions of the
immediately preceding sentence shall not limit Sections 13(b), 13(c) or 13(d) of
the Agreement or Section 7(c) of this Exhibit B. The provisions of this Section
4(a) shall survive termination of the Agreement and the provision of services
set forth in this Exhibit B.
(b) Notwithstanding anything to the contrary contained in the Agreement
or this Exhibit B, PFPC shall not be obligated to ensure or verify the accuracy
or actual receipt, or the transmission, of any data or information contained in
any transmission via Internet Account Management Services or the consummation of
any Inquiry or Transaction request not actually received by PFPC. A Fund shall
advise End-Users to promptly notify a Fund or PFPC of any errors or inaccuracies
in Shareholder data or information transmitted via Internet Account Management
Services.
33
5. PROPRIETARY RIGHTS.
(a) Each of the parties acknowledges and agrees that it obtains no
rights in or to any of the software, hardware, processes, trade secrets,
proprietary information or distribution and communication networks of the other
under this Exhibit B. Any software, interfaces or other programs a party
provides to the other under this Exhibit B shall be used by such receiving party
only during the term of this Exhibit B and only in accordance with the
provisions of this Exhibit B and the Agreement. Any interfaces, other software
or other programs developed by one party shall not be used directly or
indirectly by or for the other party or any of its affiliates to connect such
receiving party or any affiliate to any other person, without the first party's
prior written approval, which it may give or withhold in its sole discretion.
Except in the normal course of business and in conformity with Federal copyright
law or with the other party's consent, neither party nor any of its affiliates
shall disclose, use, copy, decompile or reverse engineer any software or other
programs provided to such party by the other in connection herewith.
(b) The Fund Web Site and Internet Account Management may contain
certain intellectual property, including, but not limited to, rights in
copyrighted works, trademarks and trade dress that is the property of the other
party. Each party retains all rights in such intellectual property that may
reside on the other party's web site, not including any intellectual property
provided by or otherwise obtained from such other party. To the extent the
intellectual property of one party is cached to expedite communication, such
party grants to the other a limited, non-exclusive, non-transferable license to
such intellectual property for a period of time no longer than that reasonably
necessary for the communication. To the extent that the intellectual property of
one party is duplicated within the other party's web site to replicate the "look
and feel," "trade dress" or other aspect of the appearance or functionality of
the first site, that party grants to the other a limited, non-exclusive,
non-transferable license to such intellectual property for the duration of this
Exhibit B. This license is limited to the intellectual property needed to
replicate the appearance of the first site and does not extend to any other
intellectual property owned by the owner of the first site. Each party warrants
that it has sufficient right, title and interest in and to its web site and its
intellectual property to enter into these obligations, and that to its
knowledge, the license hereby granted to the other party does not and will not
infringe on any U.S. patent, United States copyright or other United States
proprietary right of a third party.
(c) Each of the parties hereto agrees that the nonbreaching party would
not have an adequate remedy at law in the event of the other party's breach or
threatened breach of its obligations under Sections 5(a) or 5(b) of this Exhibit
B and that the nonbreaching party would suffer irreparable injury and damage as
a result of any such breach. Accordingly, in the event either party breaches or
threatens to breach the obligations set forth in Sections 5(a) or 5(b) of this
Exhibit B, in addition to and not in lieu of any legal or other remedies a party
may pursue hereunder or under applicable law, each party hereto hereby consents
to the granting of equitable relief (including the issuance of a temporary
restraining order, preliminary injunction or permanent injunction) against it by
a court of competent jurisdiction, without the necessity of proving actual
damages or posting any bond or other security therefor, prohibiting any such
breach or threatened breach. In any proceeding upon a motion for such equitable
relief, a party's ability to answer in damages shall not be interposed as a
defense to the granting of such equitable relief. The provisions of this Section
5(c) shall survive termination of the Agreement and the provision of services
set forth in this Exhibit B.
34
6. REPRESENTATION AND WARRANTY. Neither party shall knowingly insert
into any interface, other software, or other program provided by such party to
the other hereunder, or accessible on Internet Account Management or Fund Web
Site, as the case may be, any "back door," "time bomb," "Trojan Horse," "worm,"
"drop dead device," "virus" or other computer software code or routines or
hardware components designed to disable, damage or impair the operation of any
system, program or operation hereunder. For failure to comply with this
warranty, the non-complying party shall immediately replace all copies of the
affected work product, system or software. All costs incurred with replacement
including, but not limited to, cost of media, shipping, deliveries and
installation shall be borne by such party.
7. LIABILITY LIMITATIONS; INDEMNIFICATION.
(a) THE INTERNET. Each party acknowledges that the Internet is an
unsecured, unstable, unregulated, unorganized and unreliable network, and that
the ability of the other party to provide or perform services or duties
hereunder is dependent upon the Internet and equipment, software, systems, data
and services provided by various telecommunications carriers, equipment
manufacturers, firewall providers, encryption system developers and other
vendors and third parties. Each party agrees that the other shall not be liable
in any respect for the functions or malfunctions of the Internet. Each party
agrees the other shall not be liable in any respect for the actions or omissions
of any third party wrongdoers (i.e., hackers not employed by such party or its
affiliates) or of any third parties involved in the Internet Account Management
Services and shall not be liable in any respect for the selection of any such
third party, unless such party selected the third party in bad faith or in a
grossly negligent manner.
(b) PFPC'S EXPLICIT DISCLAIMER OF CERTAIN WARRANTIES. EXCEPT AS
SPECIFICALLY PROVIDED IN SECTIONS 2 AND OF THIS EXHIBIT B, ALL SOFTWARE AND
SYSTEMS DESCRIBED IN THIS EXHIBIT B ARE PROVIDED "AS-IS" ON AN "AS-AVAILABLE"
BASIS, AND PFPC HEREBY SPECIFICALLY DISCLAIMS ANY IMPLIED WARRANTY OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE AND IMPLIED WARRANTIES
ARISING FROM COURSE OF DEALING OR COURSE OF PERFORMANCE.
(c) CROSS-INDEMNITY. Each party hereto agrees to indemnify, defend and
hold harmless the other party and its affiliates (and their respective officers,
directors, agents and employees) from all taxes, charges, expenses, assessments,
claims and liabilities (including reasonable attorneys' fee and disbursements
and liabilities arising under the Securities Laws and any state and foreign
securities and blue sky laws) ("Liabilities") arising in connection with any
claims that any Internet Account Management Services or related work product
infringes any proprietary or other rights or any infringement claim against any
of such persons based on the party's intellectual property licensed to the other
party hereunder (provided the other party has used such intellectual property in
conformity with the product guidelines), except to the extent such Liabilities
result directly from the gross negligence or knowing or willful misconduct of
the other party or its related indemnified parties. The provisions of this
Section 7(c) shall survive termination of the Agreement and the provision of
services set forth in this Exhibit B.
35
8. MISCELLANEOUS.
(a) INDEPENDENT CONTRACTOR. The parties hereto are and shall remain
independent contractors, and nothing herein shall be construed to create a
partnership or joint venture between them and none of them shall have the power
or authority to bind or obligate the other in any manner not expressly set forth
herein. Any contributions to Internet Account Management by a Fund and any
contributions to the Fund Web Site by PFPC shall be works for hire pursuant to
Section 101 of the Copyright Act. (b)
(b) CONFLICT WITH AGREEMENT. In the event of a conflict between
specific terms of this Exhibit B and the Agreement, this Exhibit B shall control
as to Internet Account Management Services.
