SPECIAL SERVICING AGREEMENT
THIS SPECIAL SERVICING AGREEMENT ("Agreement"), made as of the 1st day of
January, 1998, by and between X. XXXX PRICE SPECTRUM FUND, INC. ("Spectrum
Fund"), on behalf of its separate series, X. XXXX PRICE SPECTRUM INTERNATIONAL
FUND ("Spectrum International"), EACH FUND LISTED ON APPENDIX A attached hereto
(as such Appendix A may be amended from time to time) and which evidences its
agreement to be bound separately and individually hereby by executing a copy of
this Agreement (such funds hereinafter called the "Underlying Funds"), X. XXXX
PRICE ASSOCIATES, INC. ("Price Associates") and XXXX XXXXX-XXXXXXX
INTERNATIONAL, INC. ("Xxxxx-Xxxxxxx").
W I T N E S S E T H:
WHEREAS, Spectrum International and each of the Underlying Funds are
registered as open-end, management investment companies under the Investment
Company Act of 1940, as amended ("the Act").
WHEREAS, Spectrum International, the Underlying Funds, and certain other
funds (the "Other Funds") sponsored and advised by Xxxxx-Xxxxxxx or Price
Associates have entered into an agreement ("Transfer Agency Agreement") dated
January 1, 1998, with X. Xxxx Price Services, Inc. ("Price Services") for the
provision of various transfer agency services in return for such compensation as
is set forth therein;
WHEREAS, Spectrum International, the Underlying Funds, and the Other Funds
have entered into an agreement ("RPS Agreement") dated January 1, 1998, with X.
Xxxx Price Retirement Plan Services, Inc. ("Retirement Plan Services") under
which Retirement Plan Services is to furnish or contract to furnish to Spectrum
International, the Underlying Funds, and the Other Funds various participant
account, record keeping, and services for retirement plans in return for such
compensation as is set forth therein;
WHEREAS, Spectrum International, the Underlying Funds, and the Other Funds
have entered into an agreement ("Fund Accounting Agreement") dated January 1,
1998, with Price Associates for the provision of various accounting services in
return for such compensation as is set forth therein;
WHEREAS, Spectrum International, the Underlying Funds, and the Other Funds
have entered into an agreement ("Custodian Agreement") dated September 28, 1987,
as amended, with State Street Bank and Trust Company ("State Street") under
which State
Street is to furnish to Spectrum International, the Underlying Funds and the
Other Funds various custodial services in return for such compensation as is set
forth in the Custodian Agreement;
WHEREAS, Spectrum International has entered into an Investment Management
Agreement with Xxxxx-Xxxxxxx dated November 12, 1996, for the provision of
investment management services, and under such Agreement, Xxxxx-Xxxxxxx will be
responsible for the payment of various Spectrum International expenses,
including expenses of Spectrum International's organization, operations, and
business not paid for by the Underlying Funds pursuant to this Agreement;
WHEREAS, Spectrum International will provide a means by which the
Underlying Funds can consolidate shareholder accounts in the Underlying Funds;
WHEREAS, such shareholder account consolidation can reduce the fees of the
Underlying Funds due Price Services and Retirement Plan Services under the
Transfer Agency Agreement and RPS Agreement, respectively (such reduction in
expenses hereinafter referred to as "Savings");
WHEREAS, Spectrum International will invest its assets exclusively in the
Underlying Funds, except for cash needed for expenses, redemptions, or temporary
defensive purposes; and
WHEREAS, the Board of Directors of each of the Underlying Funds has
determined it is reasonable to expect the aggregate expenses as described below
of Spectrum International to be less than the estimated Savings to each of the
Underlying Funds from the operation of Spectrum International; and such
determination by the Board of Directors is reviewed annually prior to renewing
this Agreement.
NOW, THEREFORE, in consideration of the promises and mutual covenants
spelled out herein, it is agreed between and among the parties hereto as
follows:
1. SPECTRUM INTERNATIONAL EXPENSES
In accordance with the Fund Accounting Agreement, Price Associates will
calculate the amounts of Spectrum International expenses, as set forth in
Spectrum International's Investment Management Agreement ("Expenses"), due
itself, State Street, and other persons under the Transfer Agency, RPS, Fund
Accounting, Custodian, and Investment Management Agreements referred to above,
as well as any other amounts due other persons as a result of Spectrum
International operations. However, under unusual circumstances, the parties may
agree to exclude certain amounts from Expenses.
2. UNDERLYING FUNDS' PAYMENT OF EXPENSES
Subject to Paragraph 3, each of the Underlying Funds will bear such Expenses in
proportion to the average daily value
of its shares owned by Spectrum International, provided further that no
Underlying Fund will bear such Expenses in excess of the estimated Savings to it
("Excess Expense").
3. PAYMENT BY XXXXX-XXXXXXX
In accordance with Spectrum International's Investment Management Agreement,
Xxxxx-Xxxxxxx agrees that it will bear any Excess Expense described in Paragraph
2. Payment by Xxxxx-Xxxxxxx of any such Excess Expense will be made to the
appropriate Underlying Fund no later than 30 days after the close of the
Underlying Fund's fiscal year.
4. USE OF PRICE NAME
Spectrum International may utilize the "X. Xxxx Price" name so long as this
Agreement remains in effect and the assets of Spectrum International are
invested solely in shares of the Underlying Funds (except for such cash or cash
items as may be maintained from time to time to meet current expenses and
redemptions).
5. SPECTRUM INTERNATIONAL INVESTMENT IN UNDERLYING FUNDS
Spectrum International will utilize assets deposited with the custodian of
Spectrum International, State Street, from the sale of Spectrum International
shares, to promptly purchase shares of the Underlying Funds, and will undertake
redemption or exchange of such shares of the Underlying Funds in the manner
provided by the objectives and policies of Spectrum International.
6. OPINION OF COUNSEL
At any time any of the parties hereto may consult legal counsel in respect of
any matter arising in connection with this Agreement, and no such party shall be
liable for any action taken or omitted by it in good faith in accordance with
such instructions or with the advice or opinion of such legal counsel.
7. LIABILITIES
No party hereto shall be liable to any other party hereto for any action taken
or thing done by it or its agents or contractors in carrying out the terms and
provisions of this Agreement provided such party has acted in good faith and
without negligence or willful misconduct and selected its agents and contractors
with reasonable care.
8. TERM OF AGREEMENT; AMENDMENT; RENEWAL
The term of this Agreement shall begin on January 1, 1998, and unless sooner
terminated as herein provided, the Agreement shall remain in effect through
December 31, 1998. Thereafter, this Agreement shall continue from year to year
if such continuation is specifically approved at least annually by the Board of
Directors of each Underlying Fund and Spectrum International, including a
majority of the independent Directors of each such Fund. In determining whether
to renew this Agreement, the Directors of the Underlying Funds may request, and
Price Associates will furnish, such information relevant to determining
the past and future relationship between the Savings and Expenses. The Agreement
may be modified or amended from time to time by mutual agreement between the
parties hereto. Upon termination hereof, each party hereto will make appropriate
arrangements to satisfy its obligations hereunder. This Agreement may be amended
in the future to include as additional Fund parties to the Agreement other
investment companies for which Xxxxx-Xxxxxxx or Price Associates serves as
investment manager.
9. ASSIGNMENT
This Agreement shall not be assigned or transferred, either voluntarily or
involuntarily, by operation of law or otherwise, without the prior written
consent of the Underlying Funds and Spectrum International. The Agreement shall
automatically and immediately terminate in the event of its assignment without
the prior written consent of such Funds.
10. NOTICE
Any notice under this Agreement shall be in writing, addressed and delivered or
sent by registered or certified mail, postage prepaid, to the other party at
such address as such other party may designate for the receipt of such notices.
Until further notice to the other parties, it is agreed that for this purpose
the address of all parties to this Agreement is 000 Xxxx Xxxxx Xxxxxx,
Xxxxxxxxx, Xxxxxxxx 00000, Attention: Secretary.
11. INTERPRETATIVE PROVISIONS
In connection with the operation of this Agreement, the parties may agree from
time to time on such provisions interpretative of or in addition to the
provisions of this Agreement as may in their joint opinion be consistent with
the general tenor of this Agreement. Any such interpretative or additional
provisions are to be signed by all parties and annexed hereto, but no such
provisions shall contravene any applicable Federal or state law or regulation
and no such interpretative or additional provision shall be deemed to be an
amendment of the Agreement.
12. STATE LAW
This Agreement shall be construed and enforced in accordance with and governed
by the laws of the State of Maryland.
13. CAPTIONS
The captions in the Agreement are included for convenience of reference only and
in no way define or limit any of the provisions hereof or otherwise affect their
construction or effect.
14. UNDERLYING FUNDS
Each of the Funds listed in Appendix A agree to be bound, separately and
individually, to the terms and conditions of this Agreement. Under no
circumstances will any Underlying Fund be liable for any obligation of any other
Underlying Fund.
IN WITNESS WHEREOF, the parties have caused the Agreement to be executed as
of the day and year first above written.
ATTEST:
X. XXXX PRICE ASSOCIATES, INC.
/s/Xxxxxxx Xxx Xxxx By: /s/Xxxxx X. Xxxxxxx
Xxxxxxx Xxx Xxxx, Xxxxx X. Xxxxxxx, Managing Director
Assistant Secretary
EACH OF THE FUNDS LISTED IN
APPENDIX A HERETO, SEPARATELY
AND INDIVIDUALLY
/s/Xxxxxxxx X. Xxxxxxx By: /s/Xxxxx X. Xxxxxxx
Xxxxxxxx X. Xxxxxxx, Xxxxx X. Xxxxxxx, Vice President
Assistant Secretary
X. XXXX PRICE SPECTRUM FUND, INC.,
on behalf of X. XXXX PRICE SPECTRUM
INTERNATIONAL FUND
/s/Xxxxxxxx X. Xxxxxxx By: /s/Xxxxx X. Xxxxx
Xxxxxxxx X. Xxxxxxx, Xxxxx X. Xxxxx, Chairman of the
Assistant Secretary Board
XXXX XXXXX-XXXXXXX INTERNATIONAL, INC.
/s/Xxxxxxx Xxx Xxxx By: /s/M. Xxxxx Xxxxx
Xxxxxxx Xxx Xxxx, M. Xxxxx Xxxxx, Chairman of the
Assistant Secretary Board
APPENDIX A
X. XXXX PRICE INTERNATIONAL FUNDS, INC., on behalf of the
X. Xxxx Price Emerging Markets Bond Fund
X. Xxxx Price Emerging Markets Stock Fund
X. Xxxx Price European Stock Fund
X. Xxxx Price International Bond Fund
X. Xxxx Price International Discovery Fund
X. Xxxx Price International Stock Fund
X. Xxxx Price Japan Fund
X. Xxxx Price Latin America Fund
X. Xxxx Price New Asia Fund
X. XXXX PRICE SUMMIT FUNDS, INC., on behalf of the
X. Xxxx Price Summit Cash Reserves Fund
