FRANKLIN XXXXXXXXX INVESTOR SERVICES, LLC
TRANSFER AGENT AND SHAREHOLDER SERVICES AGREEMENT
Investment Company: XXXXXXXXX FUNDS
Date: January 1, 2008
The parties to this Agreement are the Investment Company named above
("Investment Company"), an open-end investment company registered as such under
the Investment Company Act of 1940 ("1940 Act"), on behalf of each class of
shares of each series of the Investment Company which now exists or may
hereafter be created (individually, a "Fund" and collectively, the "Funds") and
FRANKLIN XXXXXXXXX INVESTOR SERVICES, LLC ("FTIS"), a registered transfer agent
formerly known as Franklin Administrative Services, Inc. This Agreement
supersedes prior Shareholder Services Agreements between the parties, as stated
below in section 16(d).
WITNESSETH:
That, for and in consideration of the mutual promises hereinafter set
forth, the Investment Company and FTIS agree as follows:
1. DEFINITIONS. Whenever used in this Agreement, the following words and
phrases, unless the context otherwise requires, shall have the following
meanings:
(a) "Articles" shall mean the Articles of Incorporation, Declaration
of Trust or Agreement of Limited Partnership, as appropriate, of the Investment
Company as the same may be amended from time to time;
(b) "Authorized Person" shall be deemed to include any person, whether
or not such person is an officer or employee of the Investment Company, duly
authorized to give Oral Instructions or Written Instructions on behalf of the
Investment Company, as indicated in a resolution of the Investment Company's
Board which was valid at the time of this Agreement, or as indicated in a
certificate furnished to FTIS pursuant to Section 4(c) hereof;
(c) "Board" shall mean the Investment Company's Board of Directors,
Board of Trustees or Managing General Partners, as appropriate;
(d) "Custodian" shall mean a custodian and any sub-custodian of
securities and other property which the Investment Company may from time to time
deposit, or cause to be deposited or held under the name or account of such
custodian pursuant to the Custody Agreement;
(e) "Oral Instructions" shall mean instructions (including without
limitation instructions received by telephone, facsimile, electronic mail or
other electronic mail), other than written instructions, actually received by
FTIS from a person reasonably believed by FTIS to be an Authorized Person;
(f) "Shares" shall mean shares of each class of capital stock,
beneficial interest or limited partnership interest, as appropriate, of each
series of the Investment Company; and
(g) "Written Instructions" shall mean a written communication signed
by a person reasonably believed by FTIS to be an Authorized Person and actually
received by FTIS.
2. APPOINTMENT OF FTIS. The Investment Company hereby appoints FTIS as
transfer agent for Shares of the Investment Company, as service agent in
connection with dividend and distribution functions, and as shareholder
servicing agent for the Investment Company, and FTIS accepts such appointment
and agrees to perform the following duties.
3. COMPENSATION.
(a) Payment to FTIS:
(i) Compensation for Servicing: The Investment Company will
compensate FTIS for the performance of its obligations hereunder in accordance
with the fees set forth in the written schedule of fees annexed hereto as
Schedule A and incorporated herein. FTIS will xxxx the Investment Company as
soon as practicable after the end of each calendar month, in accordance with
Schedule A. The Investment Company will promptly pay to FTIS the amount of such
billing.
(ii) Reimbursement for Out-of-Pocket Expenses: The Investment
Company will reimburse FTIS for out-of-pocket disbursements paid to third
parties by FTIS in the performance of its obligations hereunder including, but
not limited to, the items specified in the written schedule of out-of-pocket
expenses paid to third parties annexed hereto as Schedule B and incorporated
herein. Unspecified out-of-pocket expenses shall be limited to those
out-of-pocket expenses reasonably incurred by FTIS in the performance of its
obligations hereunder, subject to approval by the Board. Reimbursement by the
Investment Company for out-of-pocket disbursements paid by FTIS in any month
shall be made as soon as practicable after the receipt of an itemized xxxx from
FTIS.
(b) Beneficial Owner Servicing Fees to Third Parties: Subject to the
limitation set forth in paragraph (d) below, the Investment Company will
reimburse FTIS for servicing fee payments ("Beneficial Owner Servicing Fees")
made by FTIS on the Investment Company's behalf to institutions that:
(i) maintain a master account with a Fund in the institution's
name ("Omnibus Account") on behalf of numerous beneficial owners of Omnibus
Account assets; or
(ii) maintain a master account with a Fund in the institution's
name on behalf of an employer sponsored retirement plan (a "Plan Account") and
provide, directly or indirectly under separate contract with the retirement
plan, participant level accounting for each plan participant with a beneficial
ownership in Plan Account assets.
Each beneficial owner with an interest in Fund shares held in an Omnibus Account
and each plan participant with an interest in Fund shares held in a Plan Account
is referred to in this Agreement as a "Beneficial Owner".
(c) Networked Account Servicing Fees to Third Parties: Subject to the
limitation set forth in paragraph (d) below, the Investment Company will
reimburse FTIS for servicing fee payments ("Networked Account Servicing Fees")
made by FTIS on the Investment Company's behalf to an institution for each Fund
account (a "Networked Account") maintained by FTIS in which servicing is shared
with that institution by the exchange of account data through the National
Securities Clearing Corporation (NSCC) networking system.
(d) Maximum Reimbursement Amount for Beneficial Owner Servicing Fees
and Networked Account Servicing Fees. The Investment Company authorizes FTIS to
negotiate Beneficial Owner Servicing Fees and Networked Account Servicing Fees
on the Investment Company's behalf and shall reimburse FTIS for those fees
negotiated and paid up to the "Maximum Reimbursement Amount". The Maximum
Reimbursement Amount for each fiscal year of the Investment Company, calculated
on the basis of all Omnibus Accounts and all Networking Accounts open during
that fiscal year, shall equal the total amount (including out-of-pocket
expenses) that would otherwise have been payable by the Investment Company to
FTIS under the terms of this Agreement if (i) all Beneficial Owners for which
Beneficial Owner Servicing fees were paid had been Fund shareholders of record;
and (ii) all Networked Accounts for which Networked Account Servicing Fees were
paid had been Full Service Accounts (as defined in Schedule A).
(e) Compensation Adjustments. Any compensation agreed to hereunder may
be adjusted from time to time by mutual agreement by attaching revised Schedules
A or B to this Agreement.
4. Documents. In connection with the appointment of FTIS, the Investment
Company shall, within a reasonable period of time for FTIS to prepare to perform
its duties hereunder, deliver to FTIS the following documents:
(a) If applicable, specimens of the certificates for the Shares;
(b) All account application forms and other documents relating to
Shareholder accounts or to any plan, program or service offered by the
Investment Company;
(c) A certificate identifying the Authorized Persons and specimen
signatures of Authorized Persons who will sign Written Instructions; and
(d) All documents and papers necessary under the laws of the
Investment Company's state of domicile, under the Investment Company's Articles,
and as may be required for the due performance of FTIS's duties under this
Agreement or for the due performance of additional duties as may from time to
time be agreed upon between the Investment Company and FTIS.
5. Duties of the Transfer Agent. FTIS shall be responsible for
administering and/or performing transfer agent functions; for acting as service
agent in connection with dividend and distribution functions; and for performing
shareholder account and administrative agent functions in connection with the
issuance, transfer, exchange, redemption or repurchase (including coordination
with the Custodian) of Shares. FTIS shall be bound to follow its usual and
customary operating standards and procedures, as they may be amended from time
to time, and each current prospectus and Statement of Additional Information
(hereafter, collectively, the "prospectus") of the Investment Company. Without
limiting the generality of the foregoing, FTIS agrees to perform the specific
duties listed on Schedule C.
The duties to be performed by FTIS shall not include the engagement,
supervision or compensation of any service providers, or any registrations or
fees of any kind, which are required by the laws of any foreign country in which
the Fund may choose to invest portfolio assets or sell Shares.
6. (a) Distributions Payable in Shares. In the event that the Board of the
Investment Company shall declare a distribution payable in Shares, the
Investment Company shall deliver to FTIS written notice of such declaration
signed on behalf of the Investment Company by an officer thereof, upon which
FTIS shall be entitled to rely for all purposes, certifying (i) the number of
Shares involved, and (ii) that all appropriate action has been taken to effect
such distribution.
(b) Distributions Payable in Cash; Redemption Payments. In the event
that the Board of the Investment Company shall declare a distribution payable in
cash, the Investment Company shall deliver to FTIS written notice of such
declaration signed on behalf of the Investment Company by an officer thereof,
upon which FTIS shall be entitled to rely for all purposes, certifying (i) the
amount per share to be distributed, (ii) the record and payment dates for the
distribution, and (iii) that all appropriate action has been taken to effect
such distribution. Once the amount and validity of any dividend or redemption
payments to shareholders have been determined, the Investment Company shall
transfer the payment amounts from the Investment Company's accounts to an
account or accounts held in the name of FTIS, as paying agent for the
shareholders, in accordance with any applicable laws or regulations, and FTIS
shall promptly cause payments to be made to the shareholders.
7. Recordkeeping and Other Information. FTIS shall create, maintain and
preserve all necessary records in accordance with all applicable laws, rules and
regulations. Such records are the property of the Investment Company, and FTIS
will promptly surrender them to the Investment Company upon request or upon
termination of this Agreement. In the event of such a request or termination,
FTIS shall be entitled to make and retain copies of all records surrendered, and
to be reimbursed by the Investment Company for reasonable expenses actually
incurred in making such copies. FTIS will take reasonable actions to maintain
the confidentiality of the Investment Company's records, which may nevertheless
be disclosed to the extent required by law or by this Agreement, or to the
extent permitted by the Investment Company.
8. Other Duties. In addition, FTIS shall perform such other duties and
functions, and shall be paid such amounts therefor, as may from time to time be
agreed upon in writing between the Investment Company and FTIS. Such other
duties and functions shall be reflected in a written amendment to Schedule C,
and the compensation for such other duties and functions shall be reflected in a
written amendment to Schedule A.
9. Reliance by Transfer Agent; Instructions.
(a) FTIS will be protected in acting upon Written or Oral Instructions
reasonably believed to have been executed or orally communicated by an
Authorized Person and will not be held to have any notice of any change of
authority of any person until receipt of a Written Instruction thereof from an
officer of the Investment Company. FTIS will also be protected in processing
Share certificates which it reasonably believes to bear the proper manual or
facsimile signatures of the officers of the Investment Company and the proper
countersignature of FTIS.
(b) At any time FTIS may apply to any Authorized Person of the
Investment Company for Written Instructions, or may seek advice at the
Investment Company's expense from legal counsel for the Investment Company, with
respect to any matter arising in connection with this Agreement. FTIS shall not
be liable for any action taken or not taken or suffered by it in good faith in
accordance with such Written Instructions or in accordance with the opinion of
counsel for the Investment Company. Written Instructions requested by FTIS will
be provided by the Investment Company within a reasonable period of time.
10. Acts of God, etc. FTIS will not be liable or responsible for delays or
errors by reason of circumstances beyond its control, including acts of civil or
military authority, national emergencies, labor difficulties, fire, mechanical
breakdown beyond its control, earthquake, flood or catastrophe, acts of God,
insurrection, war, riots or failure beyond its control of transportation,
communication or power supply.
11. Duty of Care and Indemnification. FTIS will indemnify the Investment
Company against and hold it harmless from any and all losses, claims, damages,
liabilities or expenses (including reasonable counsel fees and expenses)
resulting from any claim, demand, action or suit resulting from willful
misfeasance, bad faith or gross negligence on the part of FTIS, and arising out
of, or in connection with, its duties hereunder. However, FTIS shall have no
liability for or obligation to indemnify the Investment Company against any
losses, claims, damages, liabilities or expenses (including reasonable counsel
fees and expenses) incurred by the Investment Company as a result of: (i) any
action taken in accordance with Written or Oral Instructions; (ii) any action
taken in accordance with written or oral advice reasonably believed by FTIS to
have been given by counsel for the Investment Company; (iii) any action taken as
a result of any error or omission in any record (including but not limited to
magnetic tapes, computer printouts, hard copies and microfilm copies) delivered,
or caused to be delivered, by the Investment Company to FTIS in connection with
this Agreement; or (iv) any action taken in accordance with shareholder
instructions which meet the standards described in the Investment Company's
current prospectus, including without limitation oral instructions which meet
the standards described in the section of the prospectus dealing with telephone
transactions, so long as FTIS believes such instructions to be genuine. The
obligations of the parties hereto under this Section shall survive the
termination of this Agreement.
12. Term and Termination.
(a) This Agreement shall be effective as of the date first written
above, shall continue through [November 30, 2008], and thereafter shall continue
automatically for successive annual periods ending on December 31 of each year,
provided such continuance is specifically approved at least annually by the
Investment Company's Board.
(b) Either party hereto may terminate this Agreement by giving to the
other party a notice in writing specifying the date of such termination, which
shall be not less than 60 days after the date of receipt of such notice. Upon
such termination, FTIS will (i) deliver to such successor a certified list of
shareholders of the Investment Company (with names and addresses) and an
historical record of the account of each Shareholder and the status thereof;
(ii) surrender all other relevant records in accordance with section 7 of this
Agreement, above, and (iii) cooperate in the transfer of such duties and
responsibilities, including provisions for assistance from FTIS's personnel in
the establishment of books, records and other data by such successor or
successors. FTIS shall be entitled to charge the Investment Company a reasonable
fee for services rendered and expenses actually incurred in performing its
duties under this paragraph.
13. Amendment. This Agreement may not be amended or modified in any manner
except by a written agreement executed by both parties.
14. Subcontracting. The Investment Company agrees that FTIS may, in its
discretion, subcontract for all or any portion of the services described under
this Agreement or the Schedules hereto; provided that the appointment of any
such agent shall not relieve FTIS of its responsibilities hereunder.
15. Data Processing System, Program and Information
(a) The Investment Company shall not, solely by virtue of this
Agreement, obtain any rights, title and interest in and to the computer systems
and programs, including all related documentation, employed by FTIS in
connection with rendering services hereunder; provided however, that the records
prepared, maintained and preserved by FTIS pursuant to this Agreement shall be
the property of the Investment Company.
(b) Any modifications, changes and improvements in the automatic data
processing system (the "System") or in the manner in which the services are
rendered shall be made or provided as follows, and provided further that
modifications for which the Investment Company will be required to bear any
expenses shall be made only as set forth herein.
(i) FTIS shall, at no expense to the Investment Company, make any
revisions in the System necessary to (1) perform the services which it has
contracted to perform and (2) create and maintain the records which it has
contracted to create and maintain hereunder or (3) enhance or update the System
to the extent and in the manner necessary to maintain said System. However, if
specific reprogramming, coding or other changes are necessary in the records of
the Investment Company or in its shareholder accounts in order to complete a
system revision, the costs for completing work specific to the Investment
Company shall be subject to a subsequent agreement between the parties. The
System is at all times to be competitive with that which is generally available
to the mutual fund industry from transfer agents.
(ii) To the extent that the System is modified to comply with
changes in the accounting or record-keeping rules applicable to mutual funds,
the Investment Company agrees to pay a reasonable pro rata portion of the costs
of the design, revision and programming of the System; provided, however, that
if the Investment Company's pro rata portion exceeds $1,000 per 12 month period,
the Investment Company's obligation to pay a reasonable pro rata portion shall
be conditioned upon FTIS's having obtained prior Written Instructions from the
Investment Company for any charge. The determination that such modifications or
revisions are necessary, and that the System as so modified produces records
which comply with the record-keeping requirements, as amended, shall be by
mutual agreement; provided, however, that upon written request by the Investment
Company, FTIS will provide the Investment Company with a written opinion of
counsel to FTIS to the effect that the modifications were required b changes in
the applicable laws or regulations and that the System, as modified, complies
with the laws or regulations as amended. Upon completion of the changes FTIS
shall render a statement to the Investment Company, in reasonably detailed form,
identifying the nature of the revisions, the services, expenses and costs, and
the basis for determining the Investment Company's reasonable pro rata portion.
Any determination by FTIS of the Investment Company's pro rata portion based
upon the ratio of the number of shareholder accounts of the Investment Company
to the total number of shareholder accounts of all clients for which FTIS
provides comparable services shall conclusively be presumed to be reasonable
unless the nature of the change to the System relates to certain types of
shareholder accounts, in which case the pro rata portion will be determined on a
mutually agreeable basis.
(iii) If system improvements are requested by the Investment
Company and are not otherwise required under this subsection 15(b), FTIS shall
be entitled to request a reasonable fee before agreeing to make the improvements
and shall be entitled to refuse to make any requested improvements which FTIS
reasonably believes to be incompatible with its systems providing services to
other funds.
16. Miscellaneous.
(a) Any notice or other instrument authorized or required by this
Agreement to be given in writing to the Investment Company or FTIS shall be
sufficiently given if addressed to that party and received by it at its office
at the place described in the Investment Company's most recent registration
statement or at such other place as it may from time to time designate in
writing.
(b) This Agreement shall extend to and shall be binding upon the
parties hereto, and their respective successors and assigns; provided, however,
that this Agreement shall not be assignable by either party without the written
consent of the other party.
(c) This Agreement shall be construed in accordance with the laws of
the State of California applicable to contracts between California residents
which are to be performed primarily within California.
(d) This Agreement may be executed in any number of counterparts, each
of which shall be deemed to be an original; but such counterparts shall,
together, constitute only one instrument. This Agreement supersedes all prior
Shareholder Services Agreements between the parties, and supersedes all prior
agreements between the parties relating to the subject matters of this Agreement
to the extent they are inconsistent with this Agreement.
(e) The captions of 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.
(f) It is understood and expressly stipulated that neither the holders
of Shares of the Investment Company nor any member of the Board, officer, agent
or employee of the Investment Company shall be personally liable hereunder, nor
shall any resort be had to other private property for the satisfaction of any
claim or obligation hereunder, but the Investment Company only shall be liable.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective corporate officers thereunder duly authorized as of
the day and year first above written.
XXXXXXXXX FUNDS
XXXXXXXX XXXXXXXXX INVESTOR SERVICES, LLC
BY:/s/XXXXXX X. XXXXXXXX /s/XXXXX X. XXX, XX.
-------------------------- -------------------------
NAME: Xxxxxx X. Xxxxxxxx Xxxxx X. Xxx, Xx.
TITLE: Secretary President
SCHEDULE A
ANNUAL BASE SERVICING FEE FOR EACH FULL SERVICE ACCOUNT. A "Full Service
Account" is an account maintained by FTIS for a Fund shareholder of record,
other than a Networked Account (as defined in Section 3(c) of this Agreement) or
an account on which Beneficial Owner Servicing Fees (as defined in Section 3(b)
of this Agreement) are paid.
EQUITY FUND $24.00 per annum
FIXED INCOME FUND $28.00 per annum
MONEY FUND $19.50 per annum
CLOSED ACCOUNT $ 3.50 per annum (pro-rated beginning with the
calendar month in which the account is closed
and continuing through the month of the
following calendar year in which the account is
purged from the operative record system)
ANNUAL BASE SERVICING FEE FOR EACH NETWORKED ACCOUNT (as defined in Section 3(c)
of this Agreement):
EQUITY FUND $12.00 per annum
FIXED INCOME FUND $14.00 per annum
MONEY FUND $10.00 per annum
CLOSED ACCOUNT $ 3.50 per annum (pro-rated beginning with the
calendar month in which the account is closed
and continuing through the month of the
following calendar year in which the account is
purged from the operative record system)
ANNUAL BASE SERVICING FEE FOR EACH BENEFICIAL OWNER (as defined in Section 3(b)
of this Agreement):
OPEN ACCOUNT $6.00 per annum
PARTICIPANT LEVEL RECORD KEEPING BY OR ON BEHALF OF FTIS FOR A PARTICIPANT
DIRECTED PLAN (as defined in Section 3(b)(ii) of this Agreement): Fifteen (15)
basis points per annum of the average net asset value of Fund shares held by a
Participant Directed Plan. The average net assets invested by a Participant
Directed Plan shall be computed in the same manner as the Fund uses to compute
its average net assets.
SCHEDULE B
OUT-OF-POCKET EXPENSES
In addition to Beneficial Owner Servicing Fees and Networked Account
Servicing Fees paid in accordance with Section 3 of this Agreement, the
Investment Company shall reimburse FTIS monthly for the following out-of-pocket
expenses paid to third parties in connection with the servicing of Accounts as
required under the terms of this Agreement:
o postage, mailing, freight, forms and stationary expenses associated with
delivery of shareholder communications such as prospectuses, reports, tax
information, proxies, shareholder statements and transaction confirmations.
o telephone costs associated with servicing shareholders in accordance with
this agreement
o ACH, Federal Reserve and bank charges for check clearance, electronic
funds transfers, and wire transfers
o Data Storage: Retention of electronic and paper account records; costs
associated with data storage of account records and transactions records
via magnetic tape, microfilm and microfiche
o insurance against loss of Share certificates when in transit
o terminals, transmitting lines and any expenses incurred in connection
with such terminals and lines established and/or maintained by FTIS to
perform its obligations under this agreement
o Amounts paid to independent accounting firms to perform independent
audits of FTIS and the issuance of reports such as a SAS 70
o Amounts paid in connection with use of national data bases to comply with
requirements for locating lost shareholders
o Proxy solicitation and tabulation expenses
o NSCC Networking/Commission Settlement Expenses. Cost to utilize NSCC
system to send commissions to brokerage firms; NSCC Fee, NSCC Year End
Fee, NSF Draft Fee Credit
o IBM Global Services - Cost of sending out eStatements
o all other miscellaneous expenses reasonably incurred by FTIS in the
performance of its obligations under the Agreement
This Schedule B may be amended by FTIS upon not less than 30 days' written
notice to the Investment Company, subject to approval by the Board.
SCHEDULE C
AS TRANSFER AGENT FOR THE INVESTMENT COMPANY, FTIS WILL:
o Upon receipt of proper authorization, record the transfer of Fund shares
("Shares") in its transfer records in the name(s) of the appropriate
legal shareholder(s) of record;
o Upon receipt of proper authorization, redeem Shares, debit shareholder
accounts and provide for payment to Shareholders; and
o If the Fund issues certificated Shares, upon receipt of proper
authorization, countersign as transfer agent and deliver certificates
upon issuance, countersign certificates to reflect ownership transfers,
and cancel certificates when redeemed.
AS SHAREHOLDER SERVICE AGENT FOR THE INVESTMENT COMPANY, FTIS WILL:
o Receive from the Investment Company, from the Investment Company's
Principal Underwriter or from a Fund shareholder, in a manner
acceptable to FTIS, information necessary to record Share sales and
redemptions and to generate sale and/or redemption confirmations;
o Mail, or electronically transmit, sale and/or redemption confirmations;
o Accept and process payments from investors and their broker-dealers or
other agents for the purchase of Shares;
o Support the use of automated systems for payment and other share
transactions, such as NSCC Fund/Serv and Networking and other systems
which may be reasonably requested by FTIS customers;
o Keep records as necessary to implement any deferred sales charges,
exchange restrictions or other policies of the Investment Company affecting
Share transactions, including without limitation any restrictions or
policies applicable to certain classes of shares, as stated in the
applicable prospectus;
o Requisition Shares in accordance with instructions of the Principal
Underwriter;
o Open, maintain and close shareholder accounts;
o Establish registration of ownership of Shares in accordance with
generally accepted form;
o Maintain records of (i) issued Shares and (ii) number of Shareholders and
their aggregate Shareholdings classified according to their residence
in each State of the United States or foreign country;
o Accept and process telephone exchanges and redemptions for Shares in
accordance with a Fund's Telephone Exchange and Redemption Privileges
as described in the Fund's current prospectus;
o Maintain and safeguard records for each Shareholder showing name(s),
address, number of any certificates issued, and number of Shares
registered in such name(s), together with continuous proof of the
outstanding Shares and dealer identification, and reflecting all
current changes. On request, provide information as to an investor's
qualification for Cumulative Quantity Discount. Provide all accounts
with, at minimum, quarterly and year-end historical confirmation
statements;
o Provide on request a duplicate set of records for file maintenance in the
Investment Company's office;
o Provide for the proper allocation of proceeds of share sales to the
Investment Company and to the Principal Underwriter, in accordance with
the applicable prospectus;
o Redeem Shares and provide for the preparation and delivery of liquidation
proceeds;
o Provide for the processing of redemption checks, and maintain checking
account records;
o Exercise reasonable and good-faith business judgment in the registration
of Share transfers, pledges and releases from pledges in accordance
with the California Uniform Commercial Code - - Investment Securities;
o From time to time make transfers of certificates for such Shares as may
be surrendered for transfer properly endorsed, and countersign new
certificates issued in lieu thereof;
o Upon receipt of proper documentation, place stop transfers, obtain
necessary insurance forms, and reissue replacement certificates against
lost, stolen or destroyed Share certificates;
o Check surrendered certificates for stop transfer restrictions. Although
FTIS cannot insure the genuineness of certificates surrendered for
cancellation, it will employ all due reasonable care in deciding the
genuineness of such certificates and the guarantor of the signature(s)
thereon;
o Cancel surrendered certificates and ecord and countersign new
certificates;
o Certify outstanding Shares to auditors;
o In connection with any meeting of Shareholders, upon receiving
appropriate detailed instructions and written materials prepared by
the Investment Company and proxy proofs checked by the Investment
Company, provide for: (a) the printing of proxy cards, (b) the
delivery to Shareholders of all reports, prospectuses, proxy cards and
related proxy materials of suitable design for enclosing, (c) the
receipt and tabulation of executed proxies, (d) solicitation of
Shareholders for their votes and (e) delivery of a list of
Shareholders for the meeting;
o Answer routine written correspondence, email, and telephone inquiries
about individual accounts. Prepare monthly reports for correspondence
volume and correspondence data necessary for the Investment Company's
Semi-Annual Report on Form N-SAR;
o Provide for the preparation and delivery of dealer commission statements
and checks;
o Maintain and furnish the Investment Company and its Shareholders with
such information as the Investment Company may reasonably request for
the purpose of compliance by the Investment Company with the
applicable tax and securities laws of applicable jurisdictions;
o Mail confirmations of transactions to investors and dealers in a timely
fashion;
o Provide for the payment or reinvestment of income dividends and/or
capital gains distributions to Shareholders of record, in accordance
with the Investment Company's and/or Shareholder's instructions,
provided that:
(a) The Investment Company shall notify FTIS in writing promptly upon
declaration of any such dividend and/or distribution, and in any
event at least forty-eight (48) hours before the record date;
(b) Such notification shall include the declaration date, the record
date, the payable date, the rate, and, if applicable, the
reinvestment date and the reinvestment price to be used; and
(c) Prior to the payable date, the Investment Company shall furnish
FTIS with sufficient fully and finally collected funds to make
such distribution;
o Prepare and file annual U.S. information returns of dividends and capital
gain distributions, gross redemption proceeds, foreign person's U.S.
source income, and other U.S. federal and state information returns as
required, and mail payee copies to shareholders; report and pay U.S.
backup withholding on all reportable payments; report and pay U.S.
federal income taxes withheld from distributions and other payments
made to nonresidents of the U.S.; prepare and mail to shareholders any
notice required by the Internal Revenue Code as to taxable dividends,
tax-exempt interest dividends, realized net capital gains distributed
and/or retained, foreign taxes paid and foreign source income
distributed or deemed distributed, U.S. source income and any tax
withheld on such income, dividends received deduction information, or
other applicable tax information appropriate for dissemination to
shareholders of the Investment Company;
o Comply with all U.S. federal income tax requirements regarding the
collection of tax identification numbers and other required
shareholder certifications and information pertaining to shareholder
accounts; respond to all notifications from the U.S. Internal Revenue
Service regarding the application of the U.S. backup withholding
requirements including tax identification number solicitation
requirements;
o Prepare transfer journals;
o Set up wire order Share transactions on file;
o Provide for receipt of payment for Share transactions, and update the
transaction file;
o Produce delinquency and other trade file reports;
o Provide dealer commission statements and provide for payments thereof for
the Principal Underwriter;
o Sort and print shareholder information by state, social code, price
break, etc.; and
o Mail promptly the Statement of Additional Information of the Investment
Company to each Shareholder upon request.
In connection with the Investment Company's Systematic Withdrawal Plan,
FTIS will:
o Make payment of amounts withdrawn periodically by the Shareholder
pursuant to the Program by redeeming Shares, and confirm such
redemptions to the Shareholder; and
o Provide confirmations of all redemptions, reinvestment of dividends and
distributions, and any additional investments in the Program,
including a summary confirmation at the year-end.
