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EXHIBIT 9(b)
TRANSFER AGENCY AND SERVICE AGREEMENT
AGREEMENT made as of the day of , 1998, by and between THE SELECT
SECTOR SPDR TRUST, a Massachusetts business trust, having its principal office
and place of business at 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000 (the
"Trust"), and STATE STREET BANK AND TRUST COMPANY, a Massachusetts trust company
having its principal office and place of business at 000 Xxxxxxxx Xxxxxx,
Xxxxxx, Xxxxxxxxxxxxx 00000 (the "Bank").
WHEREAS, the Trust is registered as an open-end management investment company
under the Investment Company Act of 1940, as amended (the "1940 Act"); and
WHEREAS, the Trust is authorized to issue shares in separate series, with each
such series representing interests in a separate portfolio of securities and
other assets;
WHEREAS, the Trust intends to initially offer shares in nine (9) series, The
Basic Industries Select Sector SPDR Fund, The Consumer Services Select Sector
SPDR Fund, The Consumer Staples Select Sector SPDR Fund, The
Cyclicals/Transportation Select Sector SPDR Fund, The Energy Sector Select SPDR
Fund, The Financial Select Sector SPDR Fund, The Industrial Select Sector SPDR
Fund, The Technology Select Sector SPDR Fund, and The Utilities Select Sector
SPDR Fund (each such series, together with all other series subsequently
established by the Trust and made subject to this Agreement in accordance with
Article 10, being herein referred to as a "Fund", and collectively as the
"Funds");
WHEREAS, the Trust will issue and redeem shares of each Fund only in
aggregations of shares known as "Creation Units" (currently 50,000 shares in the
case of each Fund) (each a "Creation Unit") principally in kind for portfolio
securities of the respective Fund, as more fully described in the prospectus and
statement of additional information of the Trust (together, the "Prospectus")
included in its registration statement on Form N-1A (the "Registration
Statement") (Reg. Nos. 333-57791; 811-08837); and
WHEREAS, the shares of each of the initial nine Funds have been approved for
listing on the American Stock Exchange LLC (the "AMEX"), subject to notice of
issuance;
WHEREAS, The Depository Trust Company, a limited purpose trust company organized
under the laws of the State of New York ("DTC"), or its nominee, will be the
initial record or registered owner (the "Shareholder") of all shares;
WHEREAS, the Trust on behalf of the Funds desires to appoint the Bank as its
transfer agent, dividend disbursing agent, and agent in connection with certain
other activities, and the Bank desires to accept such appointment;
NOW, THEREFORE, in consideration of the mutual covenants herein contained, the
parties hereto agree as follows:
l. Terms of Appointment; Duties of the Bank
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1.1 Subject to the terms and conditions set forth in this Agreement, the
Trust, on behalf of the Funds, hereby employs and appoints the Bank to
act as, and the Bank agrees to act as its transfer agent for the
authorized and issued shares of beneficial interest, $ 0.001 par value
of each Fund listed on Annex A hereto ("Shares"), and as the Trust's
dividend disbursing agent.
1.2 The Bank agrees that it will perform the following services:
(a) In accordance with procedures established from time to time by
agreement between the Trust on behalf of each of the Funds, as
applicable, and the Bank, the Bank shall:
(i) Review upon receipt from the Trust's distributor (the
"Distributor") orders for the purchase of Creation Unit
aggregations of Shares which have been submitted to the
Distributor and based on its records and the records of
DTC determine whether the order if accepted will result
in the depositor of the Fund Deposit owning or appearing
to own eighty percent (80%) of the outstanding Shares of
such Fund and provide advice of the same to the
Distributor;
(ii) Receive from the Distributor purchase orders from
Authorized Participants (as defined in the Prospectus)
for Creation Unit aggregations of Shares received in
good form and accepted by or on behalf of the Trust by
the Distributor, transmit appropriate trade instructions
to the National Securities Clearance Corporation, if
applicable, and pursuant to such orders issue the
appropriate number of Shares of the applicable Fund and
hold such Shares in the account of the Shareholder for
each of the respective Funds of the Trust;
(iii) Receive from Authorized Participants (as defined in the
Prospectus) redemption requests; deliver the appropriate
documentation thereof to the authorized custodian of the
Trust (the "Custodian"); generate and transmit or cause
to be generated and transmitted confirmation of receipt
of such redemption requests to the Authorized
Participants submitting the same; transmit appropriate
trade instructions to the National Securities Clearance
Corporation, if applicable; and redeem the appropriate
number of Creation Unit Aggregations of Shares held in
the account of the Shareholder;
(iv) Prepare and transmit by means of DTC's book-entry system
payments for dividends and distributions declared by the
Trust on behalf of the applicable Fund;
(v) Maintain the record of the name and address of the
Shareholder and the number of Shares issued by each Fund
of the Trust and held by the Shareholder;
(vi) Record the issuance of Shares of the Trust and maintain
pursuant to SEC Rule 17Ad-10(e) a record of the total
number of Shares of the Trust, and of each Fund, which
are authorized, based upon data provided to it by the
Trust, and
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issued and outstanding. The Bank shall also provide the
Trust on a regular basis with the total number of Shares
of each Fund which are authorized and issued and
outstanding and shall have no obligation, when recording
the issuance of Shares, to monitor the issuance of such
Shares or to take cognizance of any laws relating to the
issue or sale of such Shares, which functions shall be
the sole responsibility of the Trust.
(vii) Prepare and transmit to the Trust and the Administrator
all information with respect to purchases and
redemptions of Shares as may be required to be reported
to the AMEX and any other applicable securities
exchange;
(viii) On days that a Fund may accept orders for purchases or
redemptions, calculate and transmit to the Custodian and
the Trust's administrator the number of outstanding
Shares for each Fund;
(ix) On days that a Fund may accept orders for purchases or
redemptions, transmit to the Custodian, the Trust and
DTC the amount of Shares purchased or redeemed for such
Fund;
(x) Confirm to DTC the number of Shares evidenced by each
global certificate in registered form (the "Global
Certificate") issued to the Shareholder, as DTC may
reasonably request;
(xi) Prepare and deliver other reports, information and
documents to DTC as DTC may reasonably request;
(xii) Extend the voting rights to the Shareholder and/or
beneficial owners of Shares in accordance with the
policies and procedures of DTC for book-entry only
securities;
(xiii) Maintain those books and records of the Trust that are
required under Rule 31a-1(b)(2)(D) of the 1940 Act
unless otherwise directed by the Trust;
(b) In addition to and neither in lieu nor in contravention of the
services set forth in the above paragraph (a), the Bank shall:
(i) perform the customary services of a transfer agent and
dividend disbursing agent including but not limited to:
maintaining the account of the Shareholder, obtaining a list
of DTC participants holding interests in the Global
Certificate at the request of the Trust, mailing proxy
materials, shareholder reports and prospectuses to the
Shareholder or DTC participants or beneficial owners of Shares
at the request of the Trust.
(c) For so long as Shares are represented by Global Certificates,
the following shall be delivered to DTC for delivery to
beneficial owners in accordance with the procedures for
book-entry only securities of DTC:
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(i) Annual and semi-annual reports of the Trust;
(ii) Proxies, proxy statements and other proxy soliciting
materials;
(iii) Prospectus and amendments and supplements to the
Prospectus, including stickers; and
(iv) Other communications as may be required by law or
reasonably requested by the Trust.
(d) The Bank shall provide additional services on behalf of the
Trust (i.e., escheatment services) which may be agreed upon in
writing between the Trust and the Bank.
2. Fees and Expenses
2.1 For the performance by the Bank pursuant to this Agreement, the Trust
agrees on behalf of each of the Funds to pay the Bank a "unitary fee"
as set out in the initial fee schedule attached hereto and in the
Prospectus. Such fees and out-of-pocket expenses and advances
identified under Section 2.2 below may be changed from time to time
subject to mutual written agreement between the Trust and the Bank and
as described in the then current Prospectus.
2.2 In addition to the fee paid under Section 2.1 above, the Trust agrees
on behalf of each of the Funds to reimburse the Bank for out-of-pocket
expenses, including but not limited to confirmation production,
postage, forms, telephone, microfilm, microfiche, tabulating proxies,
records storage, or advances incurred by the Bank for the items set out
in the fee schedule attached hereto. In addition, any other expenses
incurred by the Bank at the request or with the consent of the Trust,
will be reimbursed by the Trust on behalf of the applicable Fund.
2.3 The Trust agrees on behalf of each of the Funds to pay all fees and
reimbursable expenses within five days following the receipt of the
respective billing notice. Postage for mailing of dividends, proxies,
Trust reports and other mailings to all shareholder accounts shall be
advanced to the Bank by the Trust at least seven (7) days prior to the
mailing date of such materials.
3. Representations and Warranties of the Bank
The Bank represents and warrants to the Trust that:
3.1 It is a trust company duly organized and existing and in good standing
under the laws of The Commonwealth of Massachusetts.
3.2 It is duly qualified to carry on its business in The Commonwealth of
Massachusetts.
3.3 It is empowered under applicable laws and by its Charter and By-Laws to
act as transfer agent and dividend disbursing agent and to enter into
and perform this Agreement.
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3.4 All requisite corporate proceedings have been taken to authorize it to
enter into and perform this Agreement.
3.5 It has and will continue to have access to the necessary facilities,
equipment and personnel to perform its duties and obligations under
this Agreement.
4. Representations and Warranties of the Trust
The Trust represents and warrants to the Bank that:
4.1 It is a business trust duly organized and existing and in good standing
under the laws of The Commonwealth of Massachusetts.
4.2 It is empowered under applicable laws and by its Declaration of Trust
and By-Laws to enter into and perform this Agreement.
4.3 All corporate proceedings required by said Declaration of Trust and
By-Laws have been taken to authorize it to enter into and perform this
Agreement.
4.4 It is an open-end management investment company registered under the
Investment Company Act of 1940, as amended.
4.5 A registration statement under the Securities Act of 1933, as amended,
on behalf of each of the Funds is currently 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 Trust
being offered for sale.
5. Data Access and Proprietary Information
5.1 The Trust acknowledges that the data bases, computer programs, screen
formats, report formats, interactive design techniques, and
documentation manuals furnished to the Trust by the Bank as part of the
Trust's ability to access certain Trust-related data ("Customer Data")
maintained by the Bank on data bases under the control and ownership of
the Bank or other third party ("Data Access Services") constitute
copyrighted, trade secret, or other proprietary information
(collectively, "Proprietary Information") of substantial value to the
Bank or other third party. In no event shall Proprietary Information be
deemed Customer Data. The Trust agrees to treat all Proprietary
Information as proprietary to the Bank and further agrees that it shall
not divulge any Proprietary Information to any person or organization
except as may be provided hereunder. Without limiting the foregoing,
the Trust agrees for itself and its employees and agents:
(a) to access Customer Data solely from locations as may be
designated in writing by the Bank and solely in accordance
with the Bank's applicable user documentation;
(b) to refrain from copying or duplicating in any way the
Proprietary Information;
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(c) to refrain from obtaining unauthorized access to any portion
of the Proprietary Information, and if such access is
inadvertently obtained, to inform in a timely manner of such
fact and dispose of such information in accordance with the
Bank's instructions;
(d) to refrain from causing or allowing the data acquired
hereunder from being retransmitted to any other computer
facility or other location, except with the prior written
consent of the Bank;
(e) that the Trust shall have access only to those authorized
transactions agreed upon by the parties;
(f) to honor all reasonable written requests made by the Bank to
protect at the Bank's expense the rights of the Bank in
Proprietary Information at common law, under federal copyright
law and under other federal or state law.
Each party shall take reasonable efforts to advise its employees of their
obligations pursuant to this Section 5. The obligations of this Section shall
survive any earlier termination of this Agreement.
5.2 If the Trust notifies the Bank that any of the Data Access Services do
not operate in material compliance with the most recently issued user
documentation for such services, the Bank shall endeavor in a timely
manner to correct such failure. Organizations from which the Bank may
obtain certain data included in the Data Access Services are solely
responsible for the contents of such data and the Trust agrees to make
no claim against the Bank arising out of the contents of such
third-party data, including, but not limited to, the accuracy thereof.
DATA ACCESS SERVICES AND ALL COMPUTER PROGRAMS AND SOFTWARE
SPECIFICATIONS USED IN CONNECTION THEREWITH ARE PROVIDED ON AN AS IS,
AS AVAILABLE BASIS. THE BANK EXPRESSLY DISCLAIMS ALL WARRANTIES EXCEPT
THOSE EXPRESSLY STATED HEREIN INCLUDING, BUT NOT LIMITED TO, THE
IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR
PURPOSE.
5.3 If the transactions available to the Trust include the ability to
originate electronic instructions to the Bank in order to (i) effect
the transfer or movement of cash or Shares or (ii) transmit Shareholder
information or other information, then in such event the Bank shall be
entitled to rely on the validity and authenticity of such instruction
without undertaking any further inquiry as long as such instruction is
undertaken in conformity with security procedures established by the
Bank from time to time.
6. Indemnification
6.1 The Bank shall not be responsible for, and the Trust shall on behalf of
the applicable Fund indemnify and hold the Bank harmless from and
against, any and all losses, damages, costs, charges, counsel fees,
payments, expenses and liability arising out of or attributable to:
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(a) All actions of the Bank or its agents or subcontractors
required to be taken pursuant to this Agreement, provided that
such actions are taken in good faith and without negligence or
willful misconduct.
(b) The Trust's negligence, willful misconduct or lack of good
faith which arise out of the breach of any representation or
warranty of the Trust hereunder.
(c) The reliance on or use by the Bank or its agents or
subcontractors of information, records, documents or services
which (i) are received by the Bank or its agents or
subcontractors, and (ii) have been prepared, maintained or
performed by the Trust or any other person or firm on behalf
of the Trust including but not limited to any previous
transfer agent or registrar.
(d) The reliance on, or the carrying out by the Bank or its agents
or subcontractors of any instructions or requests of the Trust
on behalf of the applicable Fund.
(e) The offer or sale of Shares in violation of any requirement
under the federal securities laws or regulations or the
securities laws or regulations of any state that such Shares
be registered in such state or in violation of any stop order
or other determination or ruling by any federal agency or any
state with respect to the offer or sale of such Shares in such
state.
6.2 At any time the Bank may apply to any officer of the Trust for
instructions, and may consult with legal counsel with respect to any
matter arising in connection with the services to be performed by the
Bank under this Agreement, and the Bank and its agents or
subcontractors shall not be liable and shall be indemnified by the
Trust on behalf of the applicable Fund for any action taken or omitted
by it in reliance upon such instructions or upon the opinion of such
counsel. The Bank, its agents and subcontractors shall be protected and
indemnified in acting upon any paper or document, reasonably believed
to be genuine and to have been signed by the proper person or persons,
or upon any instruction, information, data, records or documents
provided the Bank or its agents or subcontractors by machine readable
input, telex, CRT data entry or other similar means authorized by the
Trust, and shall not be held to have notice of any change of authority
of any person, until receipt of written notice thereof from the Trust.
6.3 In order that the indemnification provisions contained in this Section
6 shall apply, upon the assertion of a claim for which the Trust may be
required to indemnify the Bank, the Bank shall promptly notify the
Trust of such assertion, and shall keep the Trust advised with respect
to all developments concerning such claim. The Trust shall have the
option to participate with the Bank in the defense of such claim or to
defend against said claim in its own name or in the name of the Bank.
The Bank shall in no case confess any claim or make any compromise in
any case in which the Trust may be required to indemnify the Bank
except with the Trust's prior written consent.
7. Standard of Care
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The Bank shall at all times act in good faith and agrees to use its
best efforts within reasonable limits to insure the accuracy of all
services performed under this Agreement, but assumes no responsibility
and shall not be liable for loss or damage due to errors unless said
errors are caused by its negligence, bad faith, or willful misconduct
or that of its employees.
8. Covenants of the Trust and the Bank
8.1 The Trust shall on behalf of each of the Funds promptly furnish to the
Bank the following:
(a) A certified copy of the resolution of the Board of Trustees of
the Trust authorizing the appointment of the Bank and the
execution and delivery of this Agreement.
(b) A copy of the Declaration of Trust and By-Laws of the Trust
and all amendments thereto.
8.2 The Bank shall keep records relating to the services to be performed
hereunder, in the form and manner as it may deem advisable. To the
extent required by Section 31 of the Investment Company Act of 1940, as
amended, and the Rules thereunder, the Bank agrees that all such
records prepared or maintained by the Bank relating to the services to
be performed by the Bank hereunder are the property of the Trust and
will be preserved, maintained and made available in accordance with
such Section and Rules, and will be surrendered promptly to the Trust
on and in accordance with its request.
8.3 The Bank and the Trust agree that all books, records, information and
data pertaining to the business of the other party which are exchanged
or received pursuant to the negotiation or the carrying out of this
Agreement shall remain confidential, and shall not be voluntarily
disclosed to any other person, except as may be required by law.
8.4 In case of any requests or demands for the inspection of the
Shareholder records of the Trust, the Bank will endeavor to notify the
Trust and to secure instructions from an authorized officer of the
Trust as to such inspection. The Bank reserves the right, however, to
exhibit the Shareholder records to any person whenever it is advised by
its counsel that it may be held liable for the failure to exhibit the
Shareholder records to such person.
9. Termination of Agreement
9.1 This Agreement may be terminated by either party upon thirty (30) days
written notice to the other.
9.2 Should the Trust exercise its right to terminate, all out-of-pocket
expenses associated with the movement of records and material will be
borne by the Trust on behalf of the applicable Fund(s). Additionally,
the Bank reserves the right to charge for any other reasonable expenses
associated with such termination and/or a charge equivalent to the
average of three (3) months' fees.
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10. Additional Series
In the event that the Trust establishes one or more series of Shares in
addition to the Funds with respect to which it desires to have the Bank
render services as transfer agent under the terms hereof, it shall so
notify the Bank in writing, and if the Bank agrees in writing to
provide such services, such series of Shares shall become a Fund
hereunder.
11. Assignment
11.1 Except as provided in Section 11.3 below, neither this Agreement nor
any rights or obligations hereunder may be assigned by either party
without the written consent of the other party.
11.2 This Agreement shall inure to the benefit of and be binding upon the
parties and their respective permitted successors and assigns.
11.3 The Bank may, without further consent on the part of the Trust,
subcontract for the performance, in whole or in part, of this Agreement
with (i) Boston Financial Data Services, Inc., a Massachusetts
corporation ("BFDS") which is duly registered as a transfer agent
pursuant to Section 17A(c)(2) of the Securities Exchange Act of 1934,
as amended ("Section 17A(c)(2)"), (ii) a BFDS subsidiary duly
registered as a transfer agent pursuant to Section 17A(c)(2), (iii) a
BFDS affiliate or (iv) Boston EquiServe Trust Company, N.A.; provided,
however, that the Bank shall be as fully responsible to the Trust for
the acts and omissions of any subcontractor as it is for its own acts
and omissions.
12. Amendment
This Agreement may be amended or modified by a written agreement
executed by both parties and authorized or approved by a resolution of
the Board of Trustees of the Trust.
13. Massachusetts Law to Apply
This Agreement shall be construed and the provisions thereof
interpreted under and in accordance with the laws of The Commonwealth
of Massachusetts.
14. Force Majeure
In the event either party is unable to perform its obligations under
the terms of this Agreement because of acts of God, strikes, equipment
or transmission failure or damage reasonably beyond its control, or
other causes reasonably beyond its control, such party shall not be
liable for damages to the other for any damages resulting from such
failure to perform or otherwise from such causes.
15. Consequential Damages
Neither party to this Agreement shall be liable to the other party for
consequential damages
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under any provision of this Agreement or for any consequential damages
arising out of any act or failure to act hereunder.
16. Merger of Agreement
This Agreement constitutes the entire agreement between the parties
hereto and supersedes any prior agreement with respect to the subject
matter hereof whether oral or written.
17. Limitations of Liability of the Trustees and Shareholders
A copy of the Declaration of Trust of the Trust is on file with the
Secretary of The Commonwealth of Massachusetts, and notice is hereby
given that this instrument is executed on behalf of the Trustees of the
Trust as Trustees and not individually and that the obligations of this
instrument are not binding upon any of the Trustees or Shareholders
individually but are binding only upon the assets and property of the
Trust.
18. Counterparts
This Agreement may be executed by the parties hereto on any number of
counterparts, and all of said counterparts taken together shall be
deemed to constitute one and the same instrument.
19. Reproduction of Documents
This Agreement and all schedules, exhibits, attachments and amendments
hereto may be reproduced by any photographic, photostatic, microfilm,
micro-card, miniature photographic or other similar process. The
parties hereto all/each agree that any such reproduction shall be
admissible in evidence as the original itself in any judicial or
administrative proceeding, whether or not the original is in existence
and whether or not such reproduction was made by a party in
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the regular course of business, and that any enlargement, facsimile or
further reproduction of such reproduction shall likewise be admissible
in evidence.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
in their names and on their behalf by and through their duly authorized
officers, as of the day and year first above written.
THE SELECT SECTOR SPDR TRUST
BY:
ATTEST:
STATE STREET BANK AND TRUST
COMPANY
BY:
Executive Vice President
ATTEST:
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ANNEX A
The Basic Industries Select Sector SPDR Fund
The Consumer Services Select Sector SPDR Fund
The Consumer Staples Select Sector SPDR Fund
The Cyclical/Transportation Select Sector SPDR Fund
The Energy Sector Select SPDR Fund
The Financial Select Sector SPDR Fund
The Industrial Select Sector SPDR Fund
The Technology Select Sector SPDR Fund
The Utilities Select Sector SPDR Fund
Dated: November , 1998
