Exhibit (h)(3)
TRANSFER AGENCY AGREEMENT
AGREEMENT made this 1st day of July, 2003, between MMA PRAXIS MUTUAL FUNDS
(the "Company"), a Delaware business trust having its principal place of
business at ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, and BISYS FUND SERVICES
OHIO, INC. ("BISYS"), an Ohio corporation having its principal place of business
at ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇.
WHEREAS, the Company and BISYS entered into a Transfer Agency Agreement
dated December 31, 1998, which was amended as of July 24, 2002 (the 1998
Agreement"), whereby BISYS agreed to perform certain services for the company,
which continued in effect through the date hereof; and
WHEREAS, the Company desires that BISYS continue to perform certain
services for each series of the Company and each investment portfolio of the
Company, all as now or hereafter may be established from time to time
(individually referred to herein as a "Fund" and collectively as the "Funds");
and
WHEREAS, BISYS is willing to perform such services on the terms and
conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual premises and covenants
herein set forth, the parties agree as follows:
1. Services.
BISYS shall perform for the Company the transfer agent services set forth
in Schedule A hereto. BISYS also agrees to perform for the Company 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 A hereof, in consideration
of such fees as the parties hereto may agree.
BISYS may, with prior consent of the Company, appoint in writing other
parties qualified to perform transfer agency services reasonably acceptable to
the Company (individually, a "Sub-transfer Agent") to carry out some or all of
its responsibilities as transfer agent under this Agreement at the expense of
BISYS, with respect to a Fund; provided, however, that the Sub-transfer Agent
shall be the agent of BISYS and not the agent of the Company 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.
1
2. Fees.
For the services to be rendered, the Company shall pay to BISYS the
compensation set forth in the Omnibus Fee Agreement between the BISYS and the
Company.
3. Reimbursement of Expenses.
In addition to paying the fees described in Section 2 hereof the Company
shall also reimburse BISYS for its reasonable out-of-pocket expenses. The
Company agrees to reimburse BISYS for its' out-of-pocket expenses in providing
services hereunder, including without limitation, the following:
(a) All freight and other delivery and bonding charges incurred by BISYS
in delivering materials to and from the Company and in delivering
all materials to shareholders;
(b) All direct telephone, telephone transmission and telecopy or other
electronic transmission expenses incurred by BISYS in communication
with the Company, the Company's investment adviser or custodian,
dealers, shareholders or others as required for BISYS to perform the
services to be provided hereunder.
(c) Costs of postage, couriers, stock computer paper, statements,
labels, envelopes, checks, reports, letters, tax forms, proxies,
notices or other form of printed material which shall be required by
BISYS for the performance of the services to be provided hereunder;
(d) The cost of microfilm or microfiche of records or other materials;
(e) Sales taxes paid on behalf of the Company;
(f) Expenses associated with the tracking of "as-of" trades;
(g) All systems-related expenses associated with the provision of
special reports and services pursuant to Schedule C attached hereto;
and
(h) Any expenses BISYS shall incur at the written direction of an
officer of the Company thereunto duly authorized.
Notwithstanding the foregoing, the Company shall not be required to
reimburse any expenses to the BISYS that are covered by the omnibus fees payable
to Fund Accountant, as set forth in the Omnibus Fee Agreement.
2
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 with respect to each Fund, unless
earlier terminated by either party hereto as provided hereunder, until June 30,
2005 (the "Term"). During the Term, this Agreement may be terminated only (i) by
mutual agreement of the parties or (ii) for "cause," as defined below, upon the
provision of 60 days advance written notice by the party alleging cause.
For purposes of this Agreement, "cause" shall mean (a) a material breach
of this Agreement that has not been remedied for thirty (30) 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
Company's failure to pay an amount to BISYS which is the subject of a good faith
dispute, if (i) the Company is attempting in good faith to resolve such dispute
with as much expediency as may be possible under the circumstances, and (ii) the
Company continues to perform its obligations hereunder in all other material
respects (including paying all fees and expenses not subject to reasonable
dispute hereunder).
After such termination, for so long as BISYS, with the written consent of
the Company, in fact continues to perform any one or more of the services
contemplated by this Agreement or any Schedule or exhibit hereto, 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 Company upon such termination shall
be immediately due and payable upon and notwithstanding such termination. BISYS
shall be entitled to collect from the Company, in addition to the fees and
disbursements provided by Sections 2 and 3 hereof, the amount of all of BISYS'
reasonable cash disbursements in connection with BISYS' activities in effecting
such termination, including without limitation, the
3
delivery to the Company and/or its distributor or investment adviser and/or
other parties, of the Company's property, records, instruments and documents.
If, for any reason other than (i) expiration of the Term, (ii) mutual
agreement of the parties, or (iii) "cause," as defined above, BISYS is replaced
as transfer agent, or if a third party is added to perform all or a part of the
services provided by BISYS under this Agreement (excluding any Sub-transfer
Agent appointed by BISYS, as provided in Section 1 hereof), then the Company
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 due BISYS for the remainder of the then-current term of
this Agreement, assuming for purposes of calculation of the payment that such
balance shall be based upon the average number of Company shareholder accounts
for the twelve months prior to the date BISYS is replaced or a third party is
added.
In the event the Company 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 level of 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 BISYS is replaced or a third party is added.
The parties further acknowledge and agree that, in the event 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 provisions 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.
(a) BISYS shall use reasonable professional diligence to ensure the
accuracy of all services performed under this Agreement, but shall
not be liable to the Company 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.
(b) BISYS shall maintain adequate and reliable computer and other
equipment necessary or appropriate to carry out its obligations
under this Agreement. Upon the Company'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
4
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' reasonable
control include, without limitation, force majeure events. Force
majeure events include natural disasters, actions or decrees of
governmental bodies, 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, including
by restoring any lost or damaged data.
(c) BISYS shall provide the Company, at such times as the Company may
reasonably require, copies of the most recent reports rendered by
independent public accountants on the internal controls and
procedures of BISYS relating to the services provided by BISYS under
the Agreement.
(d) NOTWITHSTANDING ANYTHING IN THIS AGREEMENT TO THE CONTRARY, IN NO
EVENT SHALL EITHER PARTY, ITS AFFILIATES OR ANY OF ITS OR THEIR
DIRECTORS, OFFICERS, EMPLOYEES, AGENTS OR SUBCONTRACTORS BE LIABLE
FOR SPECULATIVE OR 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.
5
7. Legal Advice; Reliance on Instructions.
BISYS may apply to the Company at any time for instructions and may
consult with counsel for the Company 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. Fund Accountant shall notify the Company 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 Company, 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 Company unless relating to a matter involving BISYS'
willful misfeasance, bad faith, negligence or reckless disregard of BISYS'
responsibilities and duties.
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), believed by BISYS to be genuine and
to have been properly made, signed or authorized by an officer or other
authorized agent of the Company 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 certificate signed
by an officer of the Company or any other person authorized by the Company's
Board of Trustees/Directors (hereafter referred to as the "Directors") 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 Company relating to the Funds to the extent that such services are described
therein unless BISYS receives written instructions to the contrary in a timely
manner from the Company.
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 Company (other than an
officer or employee of BISYS) does not conflict with or violate any requirements
of the Company's Declaration of Trust, By-Laws or then-current prospectuses, or
any rule, regulation or requirement of any regulatory body.
The Company acknowledges receipt of a copy of BISYS' policy related to the
acceptance of trades for prior day processing (the "BISYS As-Of Trading
Policy"). BISYS may amend the
6
BISYS As-of Trading Policy from time to time with the written consent of the
Company. A copy of any such amendments shall be delivered to the Company 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 Company and furnished to BISYS by the
Company.
The Company acknowledges and agrees that deviations from BISYS' written
transfer agent compliance procedures may involve a substantial risk of loss. In
the event an authorized representative of the Company 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 Company
(other than an employee of BISYS) and delivered to BISYS (an "Exception");
provided that an Exception concerning the requirements of the Company's AML
Program shall be authorized by the Company'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 Company 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 in accordance
with the procedures for an Exception described herein, BISYS shall have no
liability for any loss, liability, expenses or damages to the Company resulting
from the Exception, and the Company shall indemnify BISYS and hold BISYS
harmless from any loss, liability, expenses (including reasonable attorneys
fees) and damages resulting to BISYS therefrom.
9. Indemnification.
The Company 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, reasonable counsel fees and other
expenses (including reasonable investigation expenses) (collectively, "Losses")
resulting from BISYS' 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 Company, the investment adviser, fund
accountant or custodian thereof; provided that this indemnification shall not
apply to actions or omissions of BISYS' bad faith, willful misfeasance,
negligence or reckless disregard by it of its obligations and duties hereunder;
BISYS shall indemnify, defend, and hold harmless the Company from and
against any and all Losses caused by BISYS' willful misfeasance, bad faith or
negligence in the
7
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, provided that any such advanced expenses shall be reimbursed by the
indemnified party if an ultimate determination is made that indemnification is
not merited under the circumstances. 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 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 unreasonably withheld or delayed.
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 retained by the indemnified party. The indemnity and
defense provisions set forth herein shall indefinitely survive the termination
of this Agreement.
8
10. Certain Records and Confidentiality.
BISYS shall keep and maintain on behalf of the Company all books and
records which the Company or BISYS is, 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 Company and to make such books and
records available for inspection by the Company, or by the Commission (the
"Commission") at reasonable times.
Notwithstanding the foregoing, and upon three (3) days' prior notice from
the Company, BISYS shall allow representatives of the Company to perform at
BISYS' offices on-site audits during normal business hours and of a duration
reasonably necessary to assess BISYS' adherence to the terms of this Agreement.
BISYS shall otherwise to keep confidential all books and records relating to the
Company 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 Company or the dealer of
record as to such account. BISYS shall provide the Company 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.
BISYS will furnish to the Company and to its properly-authorized auditors,
investment advisers, examiners, distributors, dealers, underwriters, salesmen,
insurance companies and others designated by the Company in writing, such
reports at such times as are prescribed in Schedule B attached hereto, or as
subsequently agreed upon by the parties pursuant to an amendment to Schedule .
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 Company and
all such other records and data will be furnished to the Company 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 Company's
demand, turn over to the Company and cease to retain BISYS' files, records and
documents created and maintained by BISYS pursuant to this Agreement which are
no longer needed by BISYS in the
9
performance of its services or for its legal protection. If not so turned over
to the Company, such documents and records will be retained by BISYS for six
years from the year of creation. At the end of such six-year period, such
records and documents will be turned over to the Company unless the Company
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 Company with such bank or banks as
are selected or approved by the Company, as may be necessary or appropriate from
time to time in connection with the services required to be performed hereunder.
The Company 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 shall require BISYS to disburse amounts from such accounts in
payment of dividends, redemption proceeds or other purposes, the Company and
Funds shall provide such bank or banks with all instructions and authorizations
necessary for BISYS for effect such disbursements.
15. Representations of the Company.
The Company represents and warrants 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 or
Articles of Incorporation, shares of each Fund which are redeemed by the Company
may be sold by the Company from its treasury, and (c) this Agreement has been
duly authorized by the Company and, when executed and delivered by the Company,
will constitute a legal, valid and binding obligation of the Company,
enforceable against the Company 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 Company also represents and warrants that (a) the Company has adopted
the written AML Program that has been submitted to BISYS pursuant to Section 18,
and has appointed an officer of the Company as the Company'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,
is permitted under the Company's AML Program, and (d) the Company will submit
any material amendments to the AML Program to BISYS for BISYS' review and
consent prior to adoption in accordance with Section 20.
16. Representations of BISYS.
BISYS represents and warrants that: (a) BISYS is currently registered with
the appropriate federal agency for the registration of transfer agents, or is
otherwise permitted to lawfully conduct its activities without such
registration, and that it will remain so registered or able to so conduct such
activities for the duration of this Agreement. BISYS agrees that it will
promptly notify the Company in the event of any change in its status as a
registered transfer agent; (b) BISYS has been in, and shall continue to be in,
substantial compliance 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
10
Agreement; (c) 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 Company and
BISYS' 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 required for the secure performance of
its obligations hereunder; and (d) 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.
BISYS also represents and warrants to the Company that it has adopted and
will maintain a written program concerning anti-money laundering services it
provides to various clients, and that its policies and procedures are reasonably
adequate for it to provide the AML Services and comply with its obligations
under this Agreement.
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 Company, BISYS shall provide
evidence that coverage is in place. BISYS shall notify the Company 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 Company 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
Company 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 Company and Funds.
The Company has furnished to BISYS the following, as amended and current
as of the date of this Agreement:
(a) Copies of the Declaration of Trust or Articles of Incorporation of
the Company and of any amendments thereto, certified by the proper
official of the state in which such Declaration or Articles has been
filed.
(b) Copies of the following documents:
(i) The Company's By-Laws and any amendments thereto;
(ii) Certified copies of resolutions of the Directors covering the
following matters:
(A) Approval of this Agreement and authorization of a
specified officer of the Company to execute and deliver
this Agreement and authorization for specified officers
of the Company to instruct BISYS hereunder; and
11
(B) Authorization of BISYS to act as Transfer Agent for the
Company on behalf of the Funds.
(c) A list of all officers of the Company, with the Company's AML
Compliance Officer included among the officers therein, and any
other persons (who may be associated with the Company 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.
(d) Two copies of the following (if such documents are employed by the
Company):
(i) Prospectuses and Statements of Additional Information;
(ii) Distribution Agreement; and
(iii) All other forms commonly used by the Company or its
Distributor with regard to their relationships and
transactions with shareholders of the Funds.
(e) A certificate as to shares of beneficial interest or common stock of
the Company authorized, issued, and outstanding as of the Effective
Date of BISYS' appointment as Transfer Agents (or as of the date on
which BISYS' services are commenced, whichever is the later date)
and as to receipt of full consideration by the Company for all
shares outstanding, such statement to be certified by the Treasurer
of the Company.
(f) A copy of the Company's written AML Program, including related
Policies and Procedures.
19. Information Furnished by BISYS.
BISYS has furnished to the Company the following:
(a) BISYS' Articles of Incorporation.
(b) BISYS' Bylaws and any amendment thereto.
(c) Certified copies of corporate actions covering the following
matters:
(i) Approval of this Agreement, and authorization of a specified
officer of BISYS to execute and deliver this Agreement;
(ii) Authorization of BISYS to act as Transfer Agent for the
Company.
(iii) The current BISYS "As-of" Trading Policy.
(iv) The written program concerning anti-money laundering services
rendered by BISYS to its various clients.
(d) A copy of the most recent independent accountants' report relating
to internal accounting control systems as filed with the Commission
pursuant to Rule 17Ad-13 under the Exchange Act.
12
20. Amendments to Documents.
21. For special cases, the parties hereto may amend such procedures set forth
herein as may be appropriate or practical under the circumstances, and BISYS may
conclusively assume that any special procedure which has been approved by the
Company does not conflict with or violate any requirements of its Articles of
Incorporation or then current prospectuses, or any rule, regulation or
requirement of any regulatory body.
22. 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 Company pursuant to Sections __ and __ of this
Agreement and, subject to the provisions of Section 6 hereof, the Company 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 any of such amendments or
changes unless the Company first obtains BISYS' written consent to and approval
of such amendments or changes.
23. Compliance with Law.
Except for the obligations of BISYS set forth herein and in Section 10
hereof, the Company assumes full responsibility for the preparation, contents,
and distribution of each prospectus of the Company 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 Company's shares.
The Company acknowledges that it is a financial institution subject to the
law entitled United and Strengthening America by Providing Appropriate Tools
Required to Intercept and
13
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.
The Company hereby delegates to BISYS the performance, on behalf of the
Company, of the anti-money laundering services set forth under Item 6 of
Schedule A as concerns the shareholder accounts maintained by BISYS pursuant to
this Agreement. BISYS agrees to the foregoing delegation and agrees to perform
such services in accordance with the Company's AML Program. In connection
therewith, BISYS agrees to maintain policies and procedures, and related
internal controls, that are consistent with the Company's AML Program and the
requirement that the Company 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'
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 Company agrees and acknowledges that, notwithstanding the delegation
provided for in the foregoing paragraph, the Company 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 Company, taking into account factors such as
its size, location, activities and risks or vulnerabilities to money laundering.
In connection with the foregoing delegation, the Company also acknowledges
that the performance of the anti-money laundering services enumerated in Item 6
of Schedule A involves the exercise of discretion which in some circumstances
may result in consequences to the Company 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 Company shall not be required in connection therewith unless
specifically required under the AML Program, and (ii) the Company instructs
BISYS that it may avail the Company of any safe harbor from civil liability that
may be available under Applicable AML Laws for making a disclosure or filing a
report thereunder.
BISYS undertakes to comply with all applicable requirements of the
securities laws and any laws, rules and regulations of governmental authorities
having jurisdiction with respect to the duties to be performed by BISYS
hereunder.
24. 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: ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, or at such
other address at such party may from time to time specify in writing to the
other party pursuant to this Section.
14
25. Assignment.
This Agreement shall not be assignable by either party without the written
consent of the other party; provided, however, that BISYS utilize agents in
connection with its services hereunder and may, at its expense and with the
advance approval of the Board, subcontract with any entity or person concerning
the provision of Fund Accounting services contemplated hereunder (a "Sub-Fund
Accountant"). BISYS shall not, however, be relieved of any of its obligations
under this Agreement by the appointment of any Sub-Fund Accountant or other
subcontractor and that BISYS shall be responsible, to the extent provided in
Section 5 hereof, for all acts of any Sub-Fund Accountant or sub-contractor as
if such acts were its own. This Agreement shall be binding upon, and shall inure
to the benefit of, the parties hereto and their respective successors and
permitted assigns.
26. Governing Law.
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.
27. Activities of BISYS.
The services of BISYS rendered to the Company 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 Directors, officers,
employees and Shareholders of the Company 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 Company, and that BISYS may be or become interested in the Company as a
Shareholder or otherwise.
28. Privacy.
Nonpublic personal financial information relating to consumers or
customers of the Company provided by, or at the direction of the Company 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 Company or
as required or permitted by law (including, without limitation, Applicable AML
Laws and Regulation S-P). 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 Company, consistent with Regulation S-P.
15
The Company 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.
29. 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 but not
limited to the 1998 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.
(e) Notwithstanding any other provision of this Agreement, the parties
agree that the assets and liabilities of each Fund of the Company
are separate and distinct from the assets and liabilities of each
other Fund and that no Fund shall be liable or shall be charged for
any debt, obligation or liability of any other Fund, whether arising
out of this Agreement or otherwise.
(f) The provisions of sections 2, 3, 5 and 9 and 12 shall survive
termination of this Agreement.
16
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed all as of the day and year first above written.
* * * * *
MMA PRAXIS MUTUAL FUNDS
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------
Title: President
BISYS FUND SERVICES OHIO, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
---------------------------
Title: President - Fund Services
17
SCHEDULE A
TO THE TRANSFER AGENCY AGREEMENT
BETWEEN
MMA PRAXIS MUTUAL FUNDS
AND
BISYS FUND SERVICES OHIO, INC.
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.
18
3. Compliance Reporting.
(a) Provide reports to the Securities and Exchange Commission, the
National Association of Securities Dealers 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.
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 transactions
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 Company.
(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.
19
(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.
(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.
20
SCHEDULE B
TO THE TRANSFER AGENCY AGREEMENT
BETWEEN
MMA PRAXIS MUTUAL FUNDS
AND
BISYS FUND SERVICES OHIO, INC.
REPORTS
1. Daily Shareholder Activity Journal
2. Daily Fund Activity Summary Report
(a) Beginning Balance
(b) Dealer Transactions
(c) Shareholder Transactions
(d) Reinvested Dividends
(e) Exchanges
(f) Adjustments
(g) Ending Balance
21
3. Daily Wire and Check Registers
4. Monthly Dealer Processing Reports
5. Monthly Dividend Reports
6. Sales Data Reports for Blue Sky Registration
7. Annual report by independent public accountants concerning BISYS'
shareholder system and internal accounting control systems to be filed
with the Securities and Exchange Commission pursuant to Rule 17Ad-13 of
the Securities Exchange Act of 1934, as amended.
8. Such special reports and additional information that the parties may agree
upon, from time to time.
9. 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:
(a) performed good order review for all new and reregistered accounts;
(b) performed acceptance review for all monetary instruments received;
(c) administered signature guarantee policy in accordance with
prospectus requirements;
(d) administered escrow hold policy in accordance with prospectus
requirements;
(e) verified customer address changes;
(f) verified customer identification for all new accounts and all name
changes on existing accounts;
(g) 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;
(h) monitored all accounts for suspicious activity resulting in the
filing of [x] Form SAR reports during the period;
22
(i) 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;
(j) created the documentation necessary to provide a basis for law
enforcement authorities to trace illicit funds;
(k) maintained all records and other documentation related to
shareholder accounts and transactions required to be prepared and
maintained pursuant to the Fund's anti-money laundering program for
all BISYS transfer agent services;
10. [The following items will be provided if the Trust falls under the related
USA PATRIOT Act provisions:]
(a) 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
(b) performed required due diligence on any new correspondent accounts
opened during the period.
23