Exhibit (h)(3)
TRANSFER AGENCY AGREEMENT
AGREEMENT effective as of the 1/st/ day of January, 2003, between THE
XXXXXX XXXXXXXXX TRUST (the "Trust"), a Delaware business trust having its
principal place of business at Five Tower Bridge 000 Xxxx Xxxxxx Xx. Xxxxx 000,
Xxxx Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000 and BISYS FUND SERVICES OHIO, INC.
("BISYS"), an Ohio corporation having its principal place of business at 0000
Xxxxxxx Xxxx, Xxxxxxxx, Xxxx 00000.
WHEREAS, the Trust and BISYS Fund Services, Inc. ("BFS") entered into a
Transfer Agency Agreement dated January 1, 2001 (the "2001 Agreement"), whereby
BFS agreed to perform transfer agency services for the Trust, which has
continued in effect through the date hereof;
WHEREAS, the Trust desires that BISYS continue to perform transfer agency
services for the Trust and each investment portfolio of the Trust, as now in
existence and listed on Schedule A hereto, or as hereafter may be established
from time to time (individually referred to herein as the "Fund" and
collectively as the "Funds");
WHEREAS, BISYS is willing to perform such services on the terms and
conditions set forth in this Agreement; and
WHEREAS, BISYS and Trust wish to enter into a new Agreement in order to set
forth the terms under which BISYS will perform the transfer agency services set
forth herein for the Trust.
NOW, THEREFORE, in consideration of the covenants hereinafter contained,
the Trust and BISYS hereby agree as follows:
1. Services
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BISYS shall perform for the Trust the transfer agent services set forth in
Schedule B hereto. BISYS also agrees to perform for the Trust such special
services incidental to the performance of the services enumerated herein as
agreed to by the parties from time to time. BISYS shall perform such additional
services as are provided on an amendment to Schedule B hereof, in consideration
of such fees as the parties hereto may agree.
BISYS may, with prior notice to the Trust, appoint in writing other parties
qualified to perform transfer agency services reasonably acceptable to the Trust
(individually, a "Sub-transfer Agent") to carry out some or all of its
responsibilities as transfer agent under this Agreement with respect to a Fund;
provided, however, that the Sub-transfer Agent shall be the agent of BISYS and
not the agent of the Trust or such Fund, and that BISYS shall be fully
responsible for the acts of such Sub-transfer Agent and shall not be relieved of
any of its responsibilities hereunder by the appointment of
such Sub-transfer Agent.
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2. Fees
----
The Trust shall pay BISYS for the services to be provided by BISYS under
this Agreement in accordance with, and in the manner set forth in, the Omnibus
Fee Agreement, dated of even date herewith, among the Trust, BISYS and BISYS
Fund Services, L.P. (the "Fee Agreement"). Fees for any additional services to
be provided by BISYS pursuant to an amendment to Schedule B hereto shall be
subject to mutual agreement at the time such amendment to Schedule B is
proposed.
3. Miscellaneous Service Fees
--------------------------
BISYS shall be entitled to receive the following fees:
(i) A fee for managing and overseeing the report, print and mail
functions performed by BISYS's third-party vendors, not to exceed
$.04 per page for statements and $.03 per page for confirmations;
fees for programming in connection with creating or changing the
forms of statements, billed at the rate of $150 per hour; and costs
for postage, couriers, stock computer paper, computer disks,
statements, labels, envelopes, checks, reports, letters, tax forms,
proxies, notices or other forms of printed material (including the
costs of preparing and printing all printed materials) which shall
be required for the performance of the services to be provided
hereunder;
(ii) System development fees, billed at the rate of $150 per hour, as
approved by the Trust, and all systems-related expenses, agreed in
advance, associated with the provision of special reports and
services pursuant to Item 8 of Schedule D attached hereto;
(iii) Fees for development of custom interfaces, billed at a mutually
agreed upon rate;
(iv) Ad hoc reporting fees, billed at a mutually agreed upon rate;
(v) Interactive Voice Response System fees, charged according o BISYS's
standard rate schedule, and applicable to the level of service
(e.g., basic, transaction, premium) selected;
(vi) Expenses associated with the tracking of "as-of" trades, billed at
the rate of $50 per hour, as approved by the Trust; and
(vii) Expenses associated with BISYS's anti-fraud procedures and the
performance of delegated services under the written anti-money
laundering program ("AML Program") adopted by the Trust.
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4. Effective Date
--------------
This Agreement shall become effective as of the date first written above
(the "Effective Date").
5. Term
----
This Agreement shall continue in effect until December 31, 2004 (the
"Initial Term"), provided that at any time after December 31, 2003, this
Agreement may be terminated by either party upon 180 days' prior written notice.
In addition, this Agreement may be terminated prior to the end of the Initial
Term by mutual agreement of the parties or immediately for "cause", as defined
below.
For purposes of this Agreement, "cause" shall mean (a) a material breach of
this Agreement that has not been remedied for forty-five (45) days following
written notice of such breach from the non-breaching party; (b) a final,
unappealable judicial, regulatory or administrative ruling or order in which the
party to be terminated has been found guilty of criminal or unethical behavior
in the conduct of its business; or (c) financial difficulties on the part of the
party to be terminated which are evidenced by the authorization or commencement
of, or involvement by way of pleading, answer, consent or acquiescence in, a
voluntary or involuntary case under Title 11 of the United States Code, as from
time to time is in effect, or any applicable law, other than said Title 11, of
any jurisdiction relating to the liquidation or reorganization of debtors or to
the modification or alteration of the rights of creditors. BISYS shall not
terminate this Agreement pursuant to clause (a) above based solely upon the
Trust's failure to pay an amount to BISYS which is the subject of a good faith
dispute, if (i) the Trust is attempting in good faith to resolve such dispute
with as much expediency as may be possible under the circumstances, and (ii) the
Trust continues to perform its obligations hereunder in all other material
respects (including paying all fees and expenses not subject to reasonable
dispute hereunder).
Notwithstanding the foregoing, following any such termination, in the event
that BISYS in fact continues to perform any one or more of the services
contemplated by this Agreement (or any Schedule or exhibit hereto) with the
consent of the Trust, the provisions of this Agreement, including without
limitation the provisions dealing with indemnification, shall continue in full
force and effect. Fees and out-of-pocket expenses incurred by BISYS but unpaid
by the Trust upon such termination shall be immediately due and payable upon and
notwithstanding such termination. BISYS shall be entitled to collect from the
Trust, in addition to the fees and disbursements provided by the Fee Agreement
and Section 3 hereof, the amount of all of BISYS's cash disbursements in
connection with BISYS's activities in effecting such termination, including
without limitation, the delivery to the Trust and/or its distributor or
investment adviser and/or other parties of the Trust's property, records,
instruments and documents.
If, for any reason other than (i) nonrenewal, (ii) mutual agreement of the
parties or (iii) "cause" for termination of BISYS hereunder, BISYS's services
are terminated hereunder, BISYS is replaced as transfer agent, or if a third
party is added to perform all
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or a part of the services provided by BISYS under this Agreement (excluding any
Sub-transfer Agent appointed as provided in Section 1 hereof), then the Trust
shall make a one-time cash payment, in consideration of the fee structure and
services to be provided under this Agreement, and not as a penalty, to BISYS
equal to the balance that would be due BISYS for its services hereunder during
(x) the next twelve (12) months or (y) if less than twelve (12), the number of
months remaining in the then-current term of this Agreement, assuming for
purposes of the calculation of the one-time payment that the fees that would be
earned by BISYS for each month shall be based upon the average number of
shareholder accounts, net assets and fees payable to BISYS monthly during the
twelve (12) months prior to the date that services terminate, BISYS is replaced
or a third party is added.
In the event the Trust or any Fund is merged into another legal entity in
part or in whole pursuant to any form of business reorganization or is
liquidated in part or in whole prior to the expiration of the then-current term
of this Agreement, the parties acknowledge and agree that the liquidated damages
provision set forth above shall be applicable in those instances in which BISYS
is not retained to provide transfer agency services consistent with this
Agreement, including the number of accounts and aggregate assets subject to such
services. The one-time cash payment referenced above shall be due and payable on
the day prior to the first day in which services are terminated, BISYS is
replaced or a third party is added.
The parties further acknowledge and agree that, in the event services are
terminated, BISYS is replaced, or a third party is added, as set forth above,
(i) a determination of actual damages incurred by BISYS would be extremely
difficult, and (ii) the liquidated damages provision contained herein is
intended to adequately compensate BISYS for damages incurred and is not intended
to constitute any form of penalty.
6. Standard of Care; Uncontrollable Events; Limitation of Liability
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BISYS shall use reasonable professional diligence to ensure the accuracy of
all services performed under this Agreement, but shall not be liable to the
Trust for any action taken or omitted by BISYS in the absence of bad faith,
willful misfeasance, negligence or reckless disregard by it of its obligations
and duties. The duties of BISYS shall be confined to those expressly set forth
herein, and no implied duties are assumed by or may be asserted against BISYS
hereunder.
BISYS shall maintain adequate and reliable computer and other equipment
necessary or appropriate to carry out its obligations under this Agreement. Upon
the Trust's reasonable request, BISYS shall provide supplemental information
concerning the aspects of its disaster recovery and business continuity plan
that are relevant to the services provided hereunder. Notwithstanding the
foregoing or any other provision of this Agreement, BISYS assumes no
responsibility hereunder, and shall not be liable for, any damage, loss of data,
delay or any other loss whatsoever caused by events beyond its reasonable
control. Events beyond BISYS's reasonable control include, without limitation,
force majeure events. Force majeure events include natural disasters, actions
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or decrees of governmental bodies, acts of terrorism, and communication lines
failures that are not the fault of either party. In the event of force majeure,
computer or other equipment failures or other events beyond its reasonable
control, BISYS shall follow applicable procedures in its disaster recovery and
business continuity plan and use all commercially reasonable efforts to minimize
any service interruption.
BISYS shall provide the Trust, at such times as the Trust may reasonably
require, copies of reports rendered by independent public accountants on the
internal controls and procedures of BISYS relating to the services provided by
BISYS under this Agreement.
NOTWITHSTANDING ANYTHING IN THIS AGREEMENT TO THE CONTRARY, IN NO EVENT
SHALL BISYS, ITS AFFILIATES OR ANY OF ITS OR THEIR DIRECTORS, OFFICERS,
EMPLOYEES, AGENTS OR SUBCONTRACTORS BE LIABLE FOR EXEMPLARY, PUNITIVE, SPECIAL,
INCIDENTAL, INDIRECT OR CONSEQUENTIAL DAMAGES, OR LOST PROFITS, EACH OF WHICH IS
HEREBY EXCLUDED BY AGREEMENT OF THE PARTIES REGARDLESS OF WHETHER SUCH DAMAGES
WERE FORESEEABLE OR WHETHER EITHER PARTY OR ANY ENTITY HAS BEEN ADVISED OF THE
POSSIBILITY OF SUCH DAMAGES.
7. Legal Advice
------------
BISYS may apply to the Trust at any time for instructions and may consult
with counsel for the Trust and with accountants and other experts with respect
to any matter arising in connection with BISYS's duties, and BISYS shall not be
liable nor accountable for any action taken or omitted by it in good faith in
accordance with such instruction or with the opinion of such counsel,
accountants or other experts. BISYS shall notify the Trust at any time BISYS
believes that it is in need of the advice of counsel (other than counsel in the
regular employ of BISYS or any affiliated companies) with regard to BISYS's
responsibilities and duties pursuant to this Agreement. After so notifying the
Trust, BISYS, at its discretion, shall be entitled to seek, receive and act upon
advice of legal counsel of its choosing, such advice to be at the expense of the
Trust unless relating to a matter involving BISYS's willful misfeasance, bad
faith, gross negligence or reckless disregard of BISYS's responsibilities and
duties hereunder, and BISYS shall in no event be liable to the Trust or any Fund
or any shareholder or beneficial owner of the Trust for any action reasonably
taken pursuant to such advice.
8. Instructions / Certain Procedures, etc.
---------------------------------------
Whenever BISYS is requested or authorized to take action hereunder pursuant
to instructions from a shareholder, or a properly authorized agent of a
shareholder ("shareholder's agent"), concerning an account in a Fund, BISYS
shall be entitled to rely upon any certificate, letter or other instrument or
communication (including electronic mail), reasonably believed by BISYS to be
genuine and to have been properly made, signed or authorized by an officer or
other authorized agent of the Trust or by the shareholder or shareholder's
agent, as the case may be, and shall be entitled to receive as conclusive proof
of any fact or matter required to be ascertained by it hereunder a
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certificate signed by an officer of the Trust or any other person authorized by
the Trust's Board of Trustees (hereafter referred to as the "Board") or by the
shareholder or shareholder's agent, as the case may be.
As to the services to be provided hereunder, BISYS may rely conclusively
upon the terms of the Prospectuses and Statement of Additional Information of
the Trust relating to the relevant Funds to the extent that such services are
described therein unless BISYS receives written instructions to the contrary in
a timely manner from the Trust.
The parties hereto may amend any procedures adopted, approved or set forth
herein by written agreement as may be appropriate or practical under the
circumstances, and BISYS may conclusively assume that any special procedure
which has been approved by an executive officer of the Trust (other than an
officer or employee of BISYS) does not conflict with or violate any requirements
of the Trust's Declaration of Trust, By-Laws or then-current prospectuses, or
any rule, regulation or requirement of any regulatory body.
The Trust acknowledges receipt of a copy of BISYS's policy related to the
acceptance of trades for prior day processing (the "BISYS As-Of Trading
Policy"). BISYS may amend the BISYS As-of Trading Policy from time to time in
its sole discretion. A copy of any such amendments shall be delivered to the
Trust upon request. BISYS may apply the BISYS As-Of Trading Policy whenever
applicable, unless BISYS agrees in writing to process trades according to such
other as-of trading policy as may be adopted by the Trust and furnished to BISYS
by the Trust.
The Trust acknowledges and agrees that deviations from BISYS's written
transfer agent compliance procedures may involve a substantial risk of loss. In
the event an authorized representative of the Trust requests that an exception
be made from any written compliance or transfer agency procedures adopted by
BISYS, or any requirements of the AML Program, BISYS may in its sole discretion
determine whether to permit such exception. In the event BISYS determines to
permit such exception, the same shall become effective when set forth in a
written instrument executed by an authorized representative of the Trust (other
than an employee of BISYS) and delivered to BISYS (an "Exception"); provided
that an Exception concerning the requirements of the Trust's AML Program shall
be authorized by the Trust's AML Compliance Officer (as defined in Section 15).
An Exception shall be deemed to remain effective until the relevant instrument
expires according to its terms (or if no expiration date is stated, until BISYS
receives written notice from the Trust that such instrument has been terminated
and the Exception is no longer in effect). Notwithstanding any provision in this
Agreement that expressly or by implication provides to the contrary, as long as
BISYS acts in good faith and without willful misconduct, BISYS shall have no
liability for any loss, liability, expenses or damages to the Trust resulting
from the Exception, and the Trust shall indemnify BISYS and hold BISYS harmless
from any loss, liability, expenses (including reasonable attorneys fees) and
damages resulting to BISYS therefrom.
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9. Indemnification
---------------
The Trust agrees to indemnify and hold harmless BISYS, its employees,
agents, directors, officers and nominees from and against any and all claims,
demands, actions and suits, and from and against any and all judgments,
liabilities, losses, damages, costs, charges, counsel fees and other expenses of
every nature and character arising out of or in any way relating to BISYS's
actions taken or omissions with respect to the performance of services under
this Agreement or based, if applicable, upon reasonable reliance on information,
records, instructions or requests given or made to BISYS by the Trust, the
investment adviser, fund accountant or custodian thereof (in each case, other
than BISYS or its affiliates); provided that this indemnification shall not
apply to actions or omissions of BISYS (or of its affiliates) in cases of its
(or their) own bad faith, willful misfeasance, negligence or reckless disregard
by it of its obligations and duties.
BISYS shall indemnify, defend, and hold the Trust harmless from and against
any and all claims, actions and suits and all losses, damages, costs, charges,
reasonable counsel fees and disbursements, payments, expenses and liabilities
(including reasonable investigation expenses) resulting directly and proximately
from BISYS's willful misfeasance, bad faith or negligence in the performance of
its duties or by reason of reckless disregard of its obligations and duties
hereunder.
The indemnification rights hereunder shall include the right to reasonable
advances of defense expenses in the event of any pending or threatened
litigation with respect to which indemnification hereunder may ultimately be
merited. In order that the indemnification provisions contained herein shall
apply, however, it is understood that if in any case a party may be asked to
indemnify or hold the other party harmless, the indemnifying party shall be
fully and promptly advised of all pertinent facts concerning the situation in
question, and it is further understood that the indemnified party will use all
reasonable care to identify and notify the indemnifying party promptly
concerning any situation which presents or appears likely to present the
probability of such a claim for indemnification against the indemnifying party,
but failure to do so in good faith shall not affect the rights hereunder except
to the extent the indemnifying party is materially prejudiced thereby. As to any
matter eligible for indemnification, an Indemnified Party shall act reasonably
and in accordance with good faith business judgment and shall not effect any
settlement or confess judgment without the consent of the Indemnifying Party,
which consent shall not be withheld or delayed unreasonably.
The indemnifying party shall be entitled to participate at its own expense
or, if it so elects, to assume the defense of any suit brought to enforce any
claims subject to this indemnity provision. If the indemnifying party elects to
assume the defense of any such claim, the defense shall be conducted by counsel
chosen by it and reasonably satisfactory to the indemnified party, whose
approval shall not be unreasonably withheld. In the event that the indemnifying
party elects to assume the defense of any suit and retain counsel, the
indemnified party shall bear the fees and expenses of any additional counsel
retained by it. If the indemnifying party does not elect to assume the defense
of suit, it will reimburse the indemnified party for the reasonable fees and
expenses of any counsel
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retained by the indemnified party. The indemnity and defense provisions set
forth herein shall indefinitely survive the termination of this Agreement.
10. Record Retention and Confidentiality
------------------------------------
BISYS shall keep and maintain on behalf of the Trust all books and records
which the Trust or BISYS is, or may be, required to keep and maintain pursuant
to any applicable statutes, rules and regulations, including without limitation
Rules 31a-1 and 31a-2 under the Investment Company Act of 1940, as amended (the
"1940 Act"), relating to the maintenance of books and records in connection with
the services to be provided hereunder. BISYS further agrees that all such books
and records shall be the property of the Trust and to make such books and
records available for inspection by the Trust or by the Securities and Exchange
Commission (the "Commission") at reasonable times. BISYS shall otherwise keep
confidential all books and records relating to the Trust and its shareholders,
except when (i) disclosure is required by law, (ii) BISYS is advised by counsel
that it may incur liability for failure to make a disclosure, (iii) BISYS is
requested to divulge such information by duly-constituted authorities or court
process, or (iv) BISYS is requested to make a disclosure by a shareholder or
shareholder's agent with respect to information concerning an account as to
which such shareholder has either a legal or beneficial interest or when
requested by the Trust or the dealer of record as to such account. BISYS shall
provide the Trust with reasonable advance notice of disclosure pursuant to items
(i) - (iii) of the previous sentence, to the extent reasonably practicable. The
provisions of this Section 10 are subject to the provisions of Section 22.
11. Reports
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BISYS shall furnish to the Trust and to its properly-authorized auditors,
investment advisers, examiners, distributors, dealers, underwriters, salesmen,
insurance companies and others designated by the Trust in writing, such reports
at such times as are prescribed in Schedule C attached hereto, or as
subsequently agreed upon by the parties pursuant to an amendment to Schedule C.
The Trust agrees to examine each such report or copy within twenty (20) days and
will report or cause to be reported any errors or discrepancies therein. In the
event that errors or discrepancies, except such errors and discrepancies as may
not reasonably be expected to be discovered by the recipient within twenty (20)
days after conducting a diligent examination, are not so reported within the
aforesaid period of time, a report will for all purposes be accepted by and
binding upon the Trust and any other recipient, and BISYS shall have no
liability for errors or discrepancies therein and shall have no further
responsibility with respect to such report except to perform reasonable
corrections of such errors and discrepancies within a reasonable time after
being requested to do so by the Trust.
12. Rights of Ownership
-------------------
All computer programs and procedures employed or developed by or on behalf
of BISYS to perform services required to be provided by BISYS under this
Agreement are the property of BISYS. All records and other data except such
computer programs and procedures are the exclusive property of the Trust and all
such other records and data
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shall be furnished to the Trust in appropriate form as soon as practicable after
termination of this Agreement for any reason.
13. Return of Records
-----------------
BISYS may at its option at any time, and shall promptly upon the Trust's
demand, turn over to the Trust and cease to retain BISYS's files, records and
documents created and maintained by BISYS pursuant to this Agreement which are
no longer needed by BISYS in the performance of its services or for its legal
protection. If not so turned over to the Trust, such documents and records shall
be retained by BISYS for six years from the year of creation. At the end of such
six-year period, such records and documents shall be turned over to the Trust
unless the Trust authorizes in writing the destruction of such records and
documents.
14. Bank Accounts
-------------
BISYS is hereby granted such power and authority as may be necessary to
establish one or more bank accounts for the Trust with such bank or banks as are
selected or approved by the Trust, as may be necessary or appropriate from time
to time in connection with the services required to be performed hereunder. The
Trust shall be deemed to be the customer of such Bank or Banks for all purposes
in connection with such accounts. To the extent that the performance of such
services hereunder shall require BISYS to disburse amounts from such accounts in
payment of dividends, redemption proceeds or for other purposes hereunder, the
Trust shall provide such bank or banks with all instructions and authorizations
necessary for BISYS to effect such disbursements.
15. Representations and Warranties of the Trust
-------------------------------------------
The Trust represents and warrants to BISYS that: (a) as of the close of
business on the Effective Date, each Fund which is in existence as of the
Effective Date has authorized unlimited shares, (b) by virtue of its Declaration
of Trust, shares of each Fund which are redeemed by the Trust may be sold by the
Trust from its treasury, and (c) this Agreement has been duly authorized by the
Trust and, when executed and delivered by the Trust, will constitute a legal,
valid and binding obligation of the Trust, enforceable against the Trust in
accordance with its terms, subject to bankruptcy, insolvency, reorganization,
moratorium and other laws of general application affecting the rights and
remedies of creditors and secured parties.
The Trust also represents and warrants that (a) the Trust has adopted the
written AML Program that has been submitted to BISYS pursuant to Section 18, and
has appointed an officer of the Trust as the Trust's anti-money laundering
compliance officer ("AML Compliance Officer"), (b) the AML Program and the
designation of the AML Officer have been approved by the Board, (c) the
delegation of certain services thereunder to BISYS, as provided in Section 22,
has been approved by the Board, and (d) the Trust will submit any material
amendments to the AML Program to BISYS for BISYS's review and consent prior to
adoption in accordance with Section 20.
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16. Representations and Warranties of BISYS
---------------------------------------
BISYS represents and warrants that: (a) BISYS has been in, and shall
continue to be in compliance in all material respects with all provisions of
law, including Section 17A(c) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), required in connection with the performance of its duties
under this Agreement; (b) the various procedures and systems which BISYS has
implemented with regard to safekeeping from loss or damage attributable to fire,
theft or any other cause of the blank checks, records, and other data of the
Trust and BISYS's records, data, equipment, facilities and other property used
in the performance of its obligations hereunder are adequate and that it will
make such changes therein from time to time as are reasonably required for the
secure performance of its obligations hereunder; and (c) this Agreement has been
duly authorized by BISYS and, when executed and delivered by BISYS, will
constitute a legal, valid and binding obligation of BISYS, enforceable against
BISYS in accordance with its terms, subject to bankruptcy, insolvency,
reorganization, moratorium and other laws of general application affecting the
right and remedies of creditors and secured parties.
EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT, ALL REPRESENTATIONS AND
WARRANTIES, 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) CONCERNING THE
SERVICES OR ANY GOODS PROVIDED INCIDENTAL TO THE SERVICES PROVIDED UNDER THIS
AGREEMENT BY BISYS ARE COMPLETELY DISCLAIMED.
17. Insurance
---------
BISYS shall maintain a fidelity bond covering larceny and embezzlement and
an insurance policy with respect to directors and officers errors and omissions
coverage in amounts that are appropriate in light of its duties and
responsibilities hereunder. Upon the request of the Trust, BISYS shall provide
evidence that coverage is in place. BISYS shall notify the Trust should its
insurance coverage with respect to professional liability or errors and
omissions coverage be canceled. Such notification shall include the date of
cancellation and the reasons therefore. BISYS shall notify the Trust of any
material claims against it with respect to services performed under this
Agreement, whether or not they may be covered by insurance, and shall notify the
Trust should the total outstanding claims made by BISYS under its insurance
coverage materially impair, or threaten to materially impair, the adequacy of
its coverage.
18. Information to be Furnished by the Trust and Funds
--------------------------------------------------
The Trust has furnished to BISYS the following, as amended and current as
of the Effective Date:
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(a) A copy of the Declaration of Trust of the Trust and of any amendments
thereto, certified by the proper official of the state in which such Declaration
has been filed.
(b) A copy of the Trust's Bylaws and any amendments thereto;
(c) Certified copies of resolutions of the Board covering the following
matters:
(i) Approval of this Agreement and authorization of a specified officer
of the Trust to execute and deliver this Agreement and authorization
for specified officers of the Trust to instruct BISYS hereunder; and
(ii) Authorization of BISYS to act as Transfer Agent for the Trust.
(d) A list of all officers of the Trust, with the Trust's AML Compliance
Officer included among the officers therein, and any other persons (who may be
associated with the Trust or its investment advisor), together with specimen
signatures of those officers and other persons who (except as otherwise provided
herein to the contrary) shall be authorized to instruct BISYS in all matters.
(e) Two copies of the following (if such documents are employed by the
Trust):
(i) Prospectuses and Statement of Additional Information;
(ii) Distribution Agreement; and
(iii) All other forms commonly used by the Trust or its Distributor with
regard to their relationships and transactions with shareholders of
the Funds.
(f) A certificate as to shares of beneficial interest of the Trust
authorized, issued, and outstanding as of the Effective Date and as to receipt
of full consideration by the Trust for all shares outstanding, such statement to
be certified by the Treasurer of the Trust.
(g) A copy of the Trust's written AML Program, including related Policies
and Procedures.
19. Information Furnished by BISYS
------------------------------
BISYS has furnished to the Trust evidence of the following:
(a) Approval of this Agreement by BISYS, and authorization of a specified
officer of BISYS to execute and deliver this Agreement;
(b) Authorization of BISYS to act as Transfer Agent for the Trust.
(c) The current BISYS "As-of" Trading Policy.
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20. Amendments to Documents
-----------------------
The Trust shall furnish BISYS written copies of any amendments to, or
changes in, any of the items referred to in Section 18 hereof forthwith upon
such amendments or changes becoming effective. In addition, the Trust agrees
that no amendments will be made to the Prospectuses or Statement of Additional
Information of the Trust, or the AML Program, which might have the effect of
changing the procedures employed by BISYS in providing the services agreed to
hereunder or which amendment might affect the duties of BISYS hereunder unless
the Trust first obtains BISYS's approval of such amendments or changes, which
approval shall not be withheld unreasonably.
21. Reliance on Amendments
----------------------
BISYS may rely on any amendments to or changes in any of the documents and
other items to be provided by the Trust pursuant to Sections 18 and 20 of this
Agreement and, subject to the provisions of Section 6 hereof, the Trust hereby
indemnifies and holds harmless BISYS from and against any and all claims,
demands, actions, suits, judgments, liabilities, losses, damages, costs,
charges, counsel fees and other expenses of every nature and character which may
result from actions or omissions on the part of BISYS in reasonable reliance
upon such amendments and/or changes. Although BISYS is authorized to rely on the
above-mentioned amendments to and changes in the documents and other items to be
provided pursuant to Sections 18 and 20 hereof, in the event the same relate to
services provided by BISYS hereunder, BISYS shall have no liability for failure
to comply with or take any action in conformity with such amendments or changes
unless the Trust first obtains BISYS's written consent to and approval of such
amendments or changes.
22. Compliance with Laws
--------------------
Except for the obligations of BISYS set forth in Section 10 hereof, the
Trust assumes full responsibility for the preparation, contents, and
distribution of each prospectus of the Trust as to compliance with all
applicable requirements of the Securities Act of 1933, as amended (the "1933
Act"), the 1940 Act, and any other laws, rules and regulations of governmental
authorities having jurisdiction. BISYS shall have no obligation to take
cognizance of any laws relating to the sale of the Trust's shares. The Trust
represents and warrants that all shares of the Trust that are offered to the
public are covered by an effective registration statement under the 1933 Act and
the 1940 Act.
The Trust acknowledges that it is a financial institution subject to the
law entitled United and Strengthening America by Providing Appropriate Tools
Required to Intercept and Obstruct Terrorism ("U.S.A. Patriot") Act of 2001 and
the Bank Secrecy Act (collectively, the "AML Acts") and shall comply with the
AML Acts and applicable regulations adopted thereunder ( collectively, the
"Applicable AML Laws") in all relevant respects, subject to the delegation of
certain responsibilities to BISYS, as provided in the next paragraph below.
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The Trust hereby delegates to BISYS the performance, on behalf of the
Trust, of the anti-money laundering services set forth under Item 6 of Schedule
B (the "AML Services") as concerns the shareholder accounts maintained by BISYS
pursuant to this Agreement (including direct accounts; accounts maintained
through FUND/SERV and Networking, to the extent provided below, and omnibus
accounts, to the extent provided below). BISYS agrees to the foregoing
delegation and agrees to perform such services in accordance with the Trust's
AML Program. In connection therewith, BISYS agrees to maintain policies and
procedures, and related internal controls, that are consistent with the Trust's
AML Program and the requirement that the Trust employ procedures reasonably
designed to achieve compliance with the Applicable AML Laws, including the
requirement to have policies and procedures that can be reasonably expected to
detect and cause the reporting of transactions under Section 5318 of the Bank
Secrecy Act. BISYS's obligations under this delegation shall be subject to
Sections 18 and 20, which require that the AML Program and any material
amendments thereto be submitted to BISYS for its review and consent.
The Trust agrees and acknowledges that, notwithstanding the delegation
provided for in the foregoing paragraph, the Trust maintains full responsibility
for ensuring that its AML Program is, and shall continue to be, reasonably
designed to ensure compliance with the Applicable AML Laws, in light of the
particular business of the Trust, taking into account factors such as its size,
location, activities and risks or vulnerabilities to money laundering.
In connection with the foregoing delegation, the Trust also acknowledges
that the performance of the AML Services involves the exercise of discretion
which in some circumstances may result in consequences to the Trust and its
shareholders (such as in the case of the reporting of suspicious activities and
the freezing of shareholder accounts). In this regard, (i) under circumstances
in which the AML Program authorizes the taking of certain actions, BISYS is
granted the discretion to take any such action as may be authorized under the
AML Program, and consultation with Trust shall not be required in connection
therewith unless specifically required under the AML Program, and (ii) the Trust
instructs BISYS that it may avail the Trust of any safe harbor from civil
liability that may be available under Applicable AML Laws for making a
disclosure or filing a report thereunder.
As concerns Networking Level III accounts and omnibus accounts, the AML
Services performed by BISYS are subject to a more limited scope, as
contermplated under the interim final rule of the Department of the Treasury, 31
CFR 103, effective April 24, 2002 (the "Interim Final Rule") and the performance
by the Trust of the risk-based evaluation of entities holding such accounts, as
contemplated under the Interim Final Rule. The foregoing reference to the
Interim Final Rule shall be deemed to include laws and regulations adopted
subsequent to the Interim Final Rule, if and to the extent consistent therewith.
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23. Notices
-------
Any notice provided hereunder shall be sufficiently given when sent by
registered or certified mail to the party required to be served with such notice
at the following address: if to the Trust, to Five Tower Bridge 000 Xxxx Xxxxxx
Xx. Xxxxx 000, Xxxx Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000, Attention: Xxxxxx X. Xxxx,
Treasurer; with a copy to the Trust at 0000 Xxxxxxx Xxxx, Xxxxxxxx, Xxxx 00000;
and if to BISYS, to it at 0000 Xxxxxxx Xxxx, Xxxxxxxx, Xxxx 00000; Attn:
President, or at such other address as such party may from time to time specify
in writing to the other party pursuant to this Section.
24. Assignment
----------
This Agreement and the rights and duties hereunder shall not be assignable
by either of the parties hereto except by the specific written consent of the
other party. This Section 24 shall not limit or in any way affect BISYS's right
to appoint a Sub-transfer Agent pursuant to Section 1 hereof. This Agreement
shall be binding upon, and shall inure to the benefit of, the parties hereto and
their respective successors and permitted assigns.
25. Governing Law and Matters Relating to the Trust
-----------------------------------------------
This Agreement shall be governed by and provisions shall be construed in
accordance with the laws of the State of Ohio and the applicable provisions of
the 1940 Act. To the extent that the applicable laws of the State of Ohio, or
any of the provisions herein, conflict with the applicable provisions of the
1940 Act, the latter shall control. It is expressly agreed that the obligations
of the Trust hereunder shall not be binding upon any of the Trustees,
shareholders, nominees, officers, agents or employees of the Trust personally,
but shall bind only the trust property of the Trust. The execution and delivery
of this Agreement have been authorized by the Board, and this Agreement has been
signed and delivered by an authorized officer of the Trust, acting as such, and
neither such authorization by the Board nor such execution and delivery by such
officer shall be deemed to have been made by any of them individually or to
impose any liability on any of them personally, but shall bind only the trust
property of the Trust as provided in the Trust's Declaration of Trust.
26. Activities of BISYS
-------------------
The services of BISYS rendered to the Trust hereunder are not to be deemed
to be exclusive. BISYS is free to render such services to others and to have
other businesses and interests. It is understood that Trustees, officers,
employees and Shareholders of the Trust are or may be or become interested in
BISYS, as officers, employees or otherwise and that partners, officers and
employees of BISYS and its counsel are or may be or become similarly interested
in the Trust, and that BISYS may be or become interested in the Trust as a
Shareholder or otherwise
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27. Privacy
-------
Nonpublic personal financial information relating to consumers or customers
of the Trust provided by, or at the direction of the Trust to BISYS, or
collected or retained by BISYS in the course of performing its duties as
transfer agent, shall be considered confidential information. BISYS shall not
give, sell or in any way transfer such confidential information to any person or
entity, other than affiliates of BISYS except at the direction of the Trust or
as required or permitted by law (including Applicable AML Laws). BISYS
represents, warrants and agrees that it has in place and will maintain physical,
electronic and procedural safeguards reasonably designed to protect the
security, confidentiality and integrity of, and to prevent unauthorized access
to or use of records and information relating to consumers or customers of the
Trust. The Trust represents to BISYS that it has adopted a Statement of its
privacy policies and practices as required by the Commission's Regulation S-P
and agrees to provide BISYS with a copy of that statement annually.
28. Miscellaneous
-------------
(a) Paragraph headings in this Agreement are included for convenience only
and are not to be used to construe or interpret this Agreement.
(b) This Agreement constitutes the complete agreement of the parties
hereto as to the subject matter covered by this Agreement, and supercedes all
prior negotiations, understandings and agreements bearing upon the subject
matter covered herein, including, without limitation, the 2001 Agreement.
(c) This Agreement may be executed in counterparts, each of which shall be
an original but all of which, taken together, shall constitute one and the same
agreement.
(d) No amendment to this Agreement shall be valid unless made in writing
and executed by both parties hereto.
* * * * *
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed all as of the day and year first above written.
THE XXXXXX XXXXXXXXX TRUST
By: /s/ Xxxxxx Xxxx
Name: Xxxxxx Xxxx
Title: Vice President
BISYS FUND SERVICES OHIO, INC.
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: President
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SCHEDULE A
TO THE TRANSFER AGENCY AGREEMENT
BETWEEN THE XXXXXX XXXXXXXXX TRUST
AND BISYS FUND SERVICES OHIO, INC.
Effective as of January 1, 2003
FUNDS
-----
The Value Equity Portfolio
The Growth Equity Portfolio
The Small Capitalization Equity Portfolio
The International Equity Portfolio
The Fixed Income Portfolio
The Intermediate Term Municipal Bond Portfolio
The Fixed Income II Portfolio
The High Yield Bond Portfolio
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SCHEDULE B
TO THE TRANSFER AGENCY AGREEMENT
BETWEEN THE XXXXXX XXXXXXXXX TRUST
AND BISYS FUND SERVICES OHIO, INC.
Effective as of January 1, 2003
TRANSFER AGENCY SERVICES
------------------------
1. Shareholder Transactions
------------------------
(a) Process shareholder purchase and redemption orders.
(b) Set up account information, including address, dividend option,
taxpayer identification numbers and wire instructions.
(c) Issue confirmations in compliance with Rule 10b-10 under the
Securities Exchange Act of 1934, as amended.
(d) Issue periodic statements for shareholders.
(e) Process transfers and exchanges.
(f) Process dividend payments, including the purchase of new shares,
through dividend reimbursement.
2. Shareholder Information Services
--------------------------------
(a) Make information available to shareholder servicing unit and
other remote access units regarding trade date, share price,
current holdings, yields, and dividend information.
(b) Produce detailed history of transactions through duplicate or
special order statements upon request.
(c) Provide mailing labels for distribution of financial reports,
prospectuses, proxy statements or marketing material to current
shareholders.
3. Compliance Reporting
--------------------
(a) Provide reports to the Securities and Exchange Commission, the
National Association of Securities Dealers, Inc. and the States
in which the Fund is registered.
(b) Prepare and distribute appropriate Internal Revenue Service forms
for corresponding Fund and shareholder income and capital gains.
(c) Issue tax withholding reports to the Internal Revenue Service.
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4. Dealer/Load Processing (if applicable)
--------------------------------------
(a) Provide reports for tracking rights of accumulation and purchases
made under a Letter of Intent.
(b) Account for separation of shareholder investments from
transaction sale charges for purchase of Fund shares.
(c) Calculate fees due under 12b-1 plans for distribution and
marketing expenses.
(d) Track sales and commission statistics by dealer and provide for
payment of commissions on direct shareholder purchases in a load
Fund.
5. Shareholder Account Maintenance
-------------------------------
(a) Maintain all shareholder records for each account in the Trust.
(b) Issue customer statements on scheduled cycle, providing duplicate
second and third party copies if required.
(c) Record shareholder account information changes.
(d) Maintain account documentation files for each shareholder.
6. Anti-Money Laundering Services
------------------------------
(a) Verify shareholder identity upon opening new accounts.
(b) Monitor, identify and report shareholder transactions and
identify and report suspicious activities that are required to be
so identified and reported, and provide other required reports to
the Securities and Exchange Commission, the U.S. Treasury
Department, the Internal Revenue Service or each agency's
designated agent, in each case consistent with the Trust's AML
Program.
(c) Place holds on transactions in shareholder accounts or freeze
assets in shareholder accounts, as provided in the Trust's AML
Program.
(d) Create documentation to provide a basis for law enforcement
authorities to trace illicit funds.
(e) Maintain all records or other documentation related to
shareholder accounts and transactions therein that are required
to be prepared and maintained pursuant to the Trust's AML
Program, and make the same available for inspection by (i) the
Trust's AML Compliance Officer, (ii) any auditor of the Trust's
AML Program or related procedures, policies or controls that has
been designated by the Trust in writing, or (iii) regulatory or
law enforcement authorities, and otherwise make said records or
other documents available at the direction of the Trust's AML
Compliance Officer.
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(f) Arrange for periodic reviews, at least annually, to be performed
by internal auditors or other auditors chosen by BISYS concerning
the BISYS operations related to the AML Services.
(g) Perform such other related services as are required by the AML
Program.
19
SCHEDULE C
TO THE TRANSFER AGENCY AGREEMENT
BETWEEN THE XXXXXX XXXXXXXXX TRUST
AND BISYS FUND SERVICES OHIO, INC.
Effective as of January 1, 2003
REPORTS
-------
1. Daily Shareholder Activity Journal
2. Daily Fund Activity Summary Report
(a) Beginning Balance
(b) Transactions
(c) Shareholder Transactions
(d) Reinvested Dividends
(e) Exchanges
(f) Adjustments
(g) Ending Balance
3. Daily Wire and Check Registers
4. Monthly Dealer Processing Reports
5. Monthly Dividend Reports
6. Sales Data Reports for Blue Sky Registration
7. A copy of the most recent report by independent public accountants
describing control structure policies and procedures relating to transfer
agency operations pursuant to AICPA Statement on Auditing Standards Number
70.
8. Such special reports and additional information that the parties may agree
upon, from time to time.
In addition to the forgoing, following each quarterly period, BISYS will provide
a report to the following effect pertaining to the AML Services rendered by
BISYS hereunder during such quarterly period:
.. performed good order review for all new and reregistered accounts;
.. performed acceptance review for all monetary instruments received;
.. administered signature guarantee policy in accordance with prospectus
requirements;
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.. administered escrow hold policy in accordance with prospectus
requirements;
.. verified customer address changes;
.. verified customer identification for all new accounts and all name
changes on existing accounts;
.. monitored all purchase transactions made with cash equivalents totaling
in excess of $10,000 resulting in the filing of [x] Form 8300 reports
during the period. The Fund does not accept cash or currency;
.. monitored all accounts for suspicious activity resulting in the filing of
[x] Form SAR reports during the period;
.. reviewed shareholder names against lists of suspected terrorist and
terrorist organizations supplied by various governmental organizations,
such as the Office of Foreign Asset Control resulting in the freezing and
reporting of [x] accounts during the period;
.. created the documentation necessary to provide a basis for law
enforcement authorities to trace illicit funds; and
.. maintained all records and other documentation related to shareholder
accounts and transactions required to e prepared and maintained pursuant
to the Fund's anti-money laundering program for all BISYS transfer agent
services.
The following will be provided in such report if the Trust falls under the
related USA PATRIOT Act provisions:
.. performed the required due diligence to help prevent the opening of any
accounts for foreign shell banks during the period either directly or
through correspondent accounts; and
.. performed required due diligence on any new correspondent accounts opened
during the period.
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