TRANSFER AGENCY AND SERVICE AGREEMENT
BETWEEN
▇▇▇▇▇ & STEERS SPECIAL EQUITY FUND, INC.
AND
STATE STREET BANK AND TRUST COMPANY
TABLE OF CONTENTS
Page
1. Terms of Appointment and Duties ......................................... 1
2. Third Party Administrators for Defined Contribution Plans. .............. 3
3. Fees and Expenses ....................................................... 4
4. Representations and Warranties of the Transfer Agent .................... 5
5. Representations and Warranties of the Fund .............................. 5
6. Wire Transfer Operating Guidelines ...................................... 6
7. Data Access and Proprietary Information ................................. 7
8. Indemnification ......................................................... 8
9. Standard of Care ........................................................ 10
10. Year 2000 ............................................................... 10
11. Confidentiality ......................................................... 10
12. Covenants of the Fund and the Transfer Agent ............................ 11
13. Termination of Agreement ................................................ 11
14. Assignment and Third Party Beneficiaries ................................ 12
15. Subcontractors .......................................................... 12
16. Miscellaneous ........................................................... 13
TRANSFER AGENCY AND SERVICE AGREEMENT
AGREEMENT made as of the day of , 2000, by and between ▇▇▇▇▇ & STEERS
SPECIAL EQUITY FUND, INC., a Maryland corporation, having its principal office
and place of business at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (the
"Fund"), and STATE STREET BANK AND TRUST COMPANY, a Massachusetts trust company
having its principal office and place of business at ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (the "Transfer Agent").
WHEREAS, the Fund desires to appoint the Transfer Agent as its transfer agent,
dividend disbursing agent, custodian of certain retirement plans and agent in
connection with certain other activities, and the Transfer Agent desires to
accept such appointment.
NOW, THEREFORE, in consideration of the mutual covenants herein contained, the
parties hereto agree as follows:
1. Terms of Appointment and Duties
1.1 Transfer Agency Services. Subject to the terms and conditions set forth in
this Agreement, the Fund hereby employs and appoints the Transfer Agent to
act as, and the Transfer Agent agrees to act as its transfer agent for the
Fund's authorized and issued shares of its common stock ("Shares"),
dividend disbursing agent, custodian of certain retirement plans and agent
in connection with any accumulation, open-account or similar plan provided
to the shareholders of the Fund ("Shareholders") and set out in the
currently effective prospectus and statement of additional information
("prospectus") of the Fund, including without limitation any periodic
investment plan or periodic withdrawal program. In accordance with
procedures established from time to time by agreement between the Fund and
the Transfer Agent, the Transfer Agent agrees that it will perform the
following services:
(a) Receive for acceptance, orders for the purchase of Shares, and promptly
deliver payment and appropriate documentation thereof to the Custodian of
the Fund authorized pursuant to the Articles of Incorporation of the Fund
(the "Custodian");
(b) Pursuant to purchase orders, issue the appropriate number of Shares and
hold such Shares in the appropriate Shareholder account;
(c) Receive for acceptance redemption requests and redemption directions
and deliver the appropriate documentation thereof to the Custodian;
(d) In respect to the transactions in items (a), (b) and (c) above, the
Transfer Agent shall execute transactions directly with broker-dealers
authorized by the Fund;
(e) At the appropriate time as and when it receives monies paid to it by
the Custodian with respect to any redemption, pay over or cause to be paid
over in the appropriate manner such monies as instructed by the redeeming
Shareholders;
(f) Effect transfers of Shares by the registered owners thereof upon
receipt of appropriate instructions;
(g) Prepare and transmit payments for dividends and distributions declared
by the Fund;
(h) Issue replacement certificates for those certificates alleged to have
been lost, stolen or destroyed upon receipt by the Transfer Agent of
indemnification satisfactory to the Transfer Agent and protecting the
Transfer Agent and the Fund, and the Transfer Agent at its option, may
issue replacement certificates in place of mutilated stock certificates
upon presentation thereof and without such indemnity;
(i) Maintain records of account for and advise the Fund and its
Shareholders as to the foregoing; and
(j) Record the issuance of Shares of the Fund and maintain pursuant to SEC
Rule 17Ad-10(e) a record of the total number of Shares of the Fund which
are authorized, based upon data provided to it by the Fund, and issued and
outstanding. The Transfer Agent shall also provide the Fund on a regular
basis with the total number of Shares which are authorized and issued and
outstanding and shall have no obligation, when recording the issuance of
Shares, to monitor the issuance of such Shares or to take cognizance of any
laws relating to the issue or sale of such Shares, which functions shall be
the sole responsibility of the Fund.
1.2 Additional Services. In addition to, and neither in lieu nor in
contravention of, the services set forth in the above paragraph, the
Transfer Agent shall perform the following services:
(a) Other Customary Services. Perform the customary services of a transfer
agent, dividend disbursing agent, custodian of certain retirement plans
and, as relevant, agent in connection with accumulation, open-account or
similar plan (including without limitation any periodic investment plan or
periodic withdrawal program), including but not limited to: maintaining all
Shareholder accounts, preparing Shareholder meeting lists, mailing
Shareholder proxies, Shareholder reports and prospectuses to current
Shareholders, withholding taxes on U.S. resident and non-resident alien
accounts, preparing and filing U.S. Treasury Department Forms 1099 and
other appropriate forms required with respect to dividends and
distributions by federal authorities for all Shareholders, preparing and
mailing confirmation forms and statements of account to Shareholders for
all purchases and redemptions of Shares and other confirmable transactions
in Shareholder accounts, preparing and mailing activity statements for
Shareholders, and providing Shareholder account information;
(b) Control Book (also known as "Super Sheet"). Maintain a daily record and
produce a daily report for the Fund of all transactions and receipts and
disbursements of money and securities and deliver a copy of such report for
the Fund for each business day to the Fund no later than 9:00 AM Eastern
Time, or such earlier time as the Fund may reasonably require, on the next
business day;
(c) "Blue Sky" Reporting. The Fund shall (i) identify to the Transfer Agent
in writing those transactions and assets to be treated as exempt from blue
sky reporting for each State and (ii) verify the establishment of
transactions for each State on the system prior to activation and
thereafter monitor the daily activity for each State. The responsibility of
the Transfer Agent for the Fund's blue sky State registration status is
solely limited to the
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initial establishment of transactions subject to blue sky compliance by the
Fund and providing a system which will enable the Fund to monitor the total
number of Shares sold in each State;
(d) National Securities Clearing Corporation (the "NSCC"). (i) accept and
effectuate the registration and maintenance of accounts through Networking
and the purchase, redemption, transfer and exchange of shares in such
accounts through Fund/SERV (Networking and Fund/SERV being programs
operated by the NSCC on behalf of NSCC's participants, including the Fund),
in accordance with, instructions transmitted to and received by the
Transfer Agent by transmission from NSCC on behalf of broker-dealers and
banks which have been established by, or in accordance with the
instructions of authorized persons, as hereinafter defined on the dealer
file maintained by the Transfer Agent; (ii) issue instructions to Fund's
banks for the settlement of transactions between the Fund and NSCC (acting
on behalf of its broker-dealer and bank participants); (iii) provide
account and transaction information from the affected Fund's records on DST
Systems, Inc. computer system TA2000 ("TA2000 System") in accordance with
NSCC's Networking and Fund/SERV rules for those broker-dealers; and (iv)
maintain Shareholder accounts on TA2000 System through Networking;
(e) New Procedures. New procedures as to who shall provide certain of these
services in Section 1 may be established in writing from time to time by
agreement between the Fund and the Transfer Agent. The Transfer Agent may
at times perform only a portion of these services and the Fund or its agent
may perform these services on the Fund's behalf; and
(f) Additional Telephone Support Services. If the parties elect to have the
Transfer Agent provide additional telephone support services under this
Agreement, the parties will agree to such services, fees and
sub-contracting as stated in Schedule 1.2(f) entitled "Telephone Support
Services" attached hereto.
2. Third Party Administrators for Defined Contribution Plans
2.1 The Fund may decide to make available to certain of its customers, a
qualified plan program (the "Program") pursuant to which the customers
("Employers") may adopt certain plans of deferred compensation ("Plan or
Plans") for the benefit of the individual Plan participant (the "Plan
Participant"), such Plan(s) being qualified under Section 401(a) of the
Internal Revenue Code of 1986, as amended ("Code") and administered by
third party administrators which may be plan administrators as defined in
the Employee Retirement Income Security Act of 1974, as amended (the
"TPA(s)").
2.2 In accordance with the procedures established in the initial Schedule 2.1
entitled "Third Party Administrator Procedures", as may be amended by the
Transfer Agent and the Fund from time to time ("Schedule 2.1"), the
Transfer Agent shall:
(a) Treat Shareholder accounts established by the Plans in the name of the
Trustees, Plans or TPA's as the case may be as omnibus accounts;
(b) Maintain omnibus accounts on its records in the name of the TPA or its
designee as the Trustee for the benefit of the Plan; and
(c) Perform all services under Section 1 as transfer agent of the Funds and
not as a recordkeeper for the Plans.
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2.3 Transactions identified under Section 2 of this Agreement shall be deemed
exception services ("Exception Services") when such transactions:
(a) Require the Transfer Agent to use methods and procedures other than
those usually employed by the Transfer Agent to perform services under
Section 1 of this Agreement;
(b) Involve the provision of information to the Transfer Agent after the
commencement of the nightly processing cycle of the TA2000 System; or
(c) Require more manual intervention by the Transfer Agent, either in the
entry of data or in the modification or amendment of reports generated by
the TA2000 System than is usually required by nonretirement plan and
pre-nightly transactions.
3. Fees and Expenses
3.1 Fee Schedule. For the performance by the Transfer Agent pursuant to this
Agreement, the Fund agrees to pay the Transfer Agent an annual maintenance
fee for each Shareholder account as set forth in the attached fee schedule
("Schedule 3.1"). Such fees and out-of-pocket expenses and advances
identified under Section 3.2 below may be changed from time to time subject
to mutual written agreement between the Fund and the Transfer Agent.
3.2 Out-of-Pocket Expenses. In addition to the fee paid under Section 3.1
above, the Fund agrees to reimburse the Transfer Agent for out-of-pocket
expenses, including but not limited to confirmation production, postage,
forms, telephone, microfilm, microfiche, mailing and tabulating proxies,
records storage, or advances incurred by the Transfer Agent for the items
set out in Schedule 3.1 attached hereto. In addition, any other expenses
incurred by the Transfer Agent at the request or with the consent of the
Fund, will be reimbursed by the Fund.
3.3 Postage. Postage for mailing of dividends, proxies, Fund reports and other
mailings to all shareholder accounts shall be advanced to the Transfer
Agent by the Fund at least seven (7) days prior to the mailing date of such
materials.
3.4 Invoices. The Fund agrees to pay all fees and reimbursable expenses within
thirty (30) days following the receipt of the respective billing notice,
except for any fees or expenses that are subject to good faith dispute. In
the event of such a dispute, the Fund may only withhold that portion of the
fee or expense subject to the good faith dispute. The Fund shall notify the
Transfer Agent in writing within twenty-one (21) calendar days following
the receipt of each billing notice if the Fund is disputing any amounts in
good faith. If the Fund does not provide such notice of dispute within the
required time, the billing notice will be deemed accepted by the Fund. The
Fund shall settle such disputed amounts within five (5) days of the day on
which the parties agree on the amount to be paid by payment of the agreed
amount. If no agreement is reached, then such disputed amounts shall be
settled as may be required by law or legal process.
3.5 Cost of Living Adjustment. Following the Initial Term, unless the parties
shall otherwise agree and provided that the service mix and volumes remain
consistent as previously provided in the Initial Term, the total fee for
all services shall equal the fee that would be charged for the same
services based on a fee rate (as reflected in a fee rate schedule)
increased by the percentage increase for the twelve-month period of such
previous calendar
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year of the Consumer Price Index for Urban Wage Earners and Clerical
Workers, for the Boston area, as published bimonthly by the United States
Department of Labor, Bureau of Labor Statistics, or, in the event that
publication of such Index is terminated, any successor or substitute index,
appropriately adjusted, acceptable to both parties.
3.6 Late Payments. If any undisputed amount in an invoice of the Transfer Agent
(for fees or reimbursable expenses) is not paid when due, the Fund shall
pay the Transfer Agent interest thereon (from the due date to the date of
payment) at a per annum rate equal to one percent (1.0%) plus the Prime
Rate (that is, the base rate on corporate loans posted by large domestic
banks) published by The Wall Street Journal (or, in the event such rate is
not so published, a reasonably equivalent published rate selected by the
Fund) on the first day of publication during the month when such amount was
due. Notwithstanding any other provision hereof, such interest rate shall
be no greater than permitted under applicable provisions of Massachusetts
law.
4. Representations and Warranties of the Transfer Agent
The Transfer Agent represents and warrants to the Fund that:
4.1 It is a trust company duly organized and existing and in good standing
under the laws of The Commonwealth of Massachusetts.
4.2 It is duly qualified to carry on its business in The Commonwealth of
Massachusetts.
4.3 It is empowered under applicable laws and by its Charter and By-Laws to
enter into and perform this Agreement.
4.4 All requisite corporate proceedings have been taken to authorize it to
enter into and perform this Agreement.
4.5 It has and will continue to have access to the necessary facilities,
equipment and personnel to perform its duties and obligations under this
Agreement.
5. Representations and Warranties of the Fund
The Fund represents and warrants to the Transfer Agent that:
5.1 It is a corporation duly organized and existing and in good standing under
the laws of the State of Maryland.
5.2 It is empowered under applicable laws and by its Articles of Incorporation
and By-Laws to enter into and perform this Agreement.
5.3 All corporate proceedings required by said Articles of Incorporation and
By-Laws have been taken to authorize it to enter into and perform this
Agreement.
5.4 It is an open-end and diversified management investment company registered
under the Investment Company Act of 1940, as amended.
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5.5 A registration statement under the Securities Act of 1933, as amended is
currently effective and will remain effective, and appropriate state
securities law filings have been made and will continue to be made, with
respect to all Shares of the Fund being offered for sale.
6. Wire Transfer Operating Guidelines/Articles 4A of the Uniform Commercial
Code
6.1 Obligation of Sender. The Transfer Agent is authorized to promptly debit
the appropriate Fund account(s) upon the receipt of a payment order in
compliance with the selected security procedure (the "Security Procedure")
chosen for funds transfer and in the amount of money that the Transfer
Agent has been instructed to transfer. The Transfer Agent shall execute
payment orders in compliance with the Security Procedure and with the Fund
instructions on the execution date provided that such payment order is
received by the customary deadline for processing such a request, unless
the payment order specifies a later time. All payment orders and
communications received after this the customary deadline will be deemed to
have been received the next business day.
6.2 Security Procedure. The Fund acknowledges that the Security Procedure it
has designated on the Fund Selection Form was selected by the Fund from
security procedures offered by the Transfer Agent. The Fund shall restrict
access to confidential information relating to the Security Procedure to
authorized persons as communicated to the Transfer Agent in writing. The
Fund must notify the Transfer Agent immediately if it has reason to believe
unauthorized persons may have obtained access to such information or of any
change in the Fund's authorized personnel. The Transfer Agent shall verify
the authenticity of all Fund instructions according to the Security
Procedure.
6.3 Account Numbers. The Transfer Agent shall process all payment orders on the
basis of the account number contained in the payment order. In the event of
a discrepancy between any name indicated on the payment order and the
account number, the account number shall take precedence and govern.
6.4 Rejection. The Transfer Agent reserves the right to decline to process or
delay the processing of a payment order which (a) is in excess of the
collected balance in the account to be charged at the time of the Transfer
Agent's receipt of such payment order; (b) if initiating such payment order
would cause the Transfer Agent, in the Transfer Agent's sole judgement, to
exceed any volume, aggregate dollar, network, time, credit or similar
limits which are applicable to the Transfer Agent; or (c) if the Transfer
Agent, in good faith, is unable to satisfy itself that the transaction has
been properly authorized.
6.5 Cancellation Amendment. The Transfer Agent shall use reasonable efforts to
act on all authorized requests to cancel or amend payment orders received
in compliance with the Security Procedure provided that such requests are
received in a timely manner affording the Transfer Agent reasonable
opportunity to act. However, the Transfer Agent assumes no liability if the
request for amendment or cancellation cannot be satisfied.
6.6 Errors. The Transfer Agent shall assume no responsibility for failure to
detect any erroneous payment order provided that the Transfer Agent
complies with the payment order instructions as received and the Transfer
Agent complies with the Security Procedure. The Security Procedure is
established for the purpose of authenticating payment orders only and not
for the detection of errors in payment orders.
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6.7 Interest. The Transfer Agent shall assume no responsibility for lost
interest with respect to the refundable amount of any unauthorized payment
order, unless the Transfer Agent is notified of the unauthorized payment
order within thirty (30) days of notification by the Transfer Agent of the
acceptance of such payment order.
6.8 ACH Credit Entries/Provisional Payments. When the Fund initiates or
receives Automated Clearing House credit and debit entries pursuant to
these guidelines and the rules of the National Automated Clearing House
Association and the New England Clearing House Association, the Transfer
Agent will act as an Originating Depository Financial Institution and/or
Receiving Depository Financial Institution, as the case may be, with
respect to such entries. Credits given by the Transfer Agent with respect
to an ACH credit entry are provisional until the Transfer Agent receives
final settlement for such entry from the Federal Reserve Bank. If the
Transfer Agent does not receive such final settlement, the Fund agrees that
the Transfer Agent shall receive a refund of the amount credited to the
Fund in connection with such entry, and the party making payment to the
Fund via such entry shall not be deemed to have paid the amount of the
entry.
6.9 Confirmation. Confirmation of Transfer Agent's execution of payment orders
shall ordinarily be provided within twenty four (24) hours notice of which
may be delivered through the Transfer Agent's proprietary information
systems, or by facsimile or call-back. Fund must report any objections to
the execution of an order within thirty (30) days.
7. Data Access and Proprietary Information
7.1 The Fund acknowledges that the databases, computer programs, screen
formats, report formats, interactive design techniques, and documentation
manuals furnished to the Fund by the Transfer Agent as part of the Fund's
ability to access certain Fund-related data ("Customer Data") maintained by
the Transfer Agent on databases under the control and ownership of the
Transfer Agent or other third party ("Data Access Services") constitute
copyrighted, trade secret, or other proprietary information (collectively,
"Proprietary Information") of substantial value to the Transfer Agent or
other third party. In no event shall Proprietary Information be deemed
Customer Data. The Fund agrees to treat all Proprietary Information as
proprietary to the Transfer Agent and further agrees that it shall not
divulge any Proprietary Information to any person or organization except as
may be provided hereunder. Without limiting the foregoing, the Fund agrees
for itself and its employees and agents to:
(a) Use such programs and databases (i) solely on the Fund's computers, or
(ii) solely from equipment at the location agreed to between the Fund and
the Transfer Agent and (iii) solely in accordance with the Transfer Agent's
applicable user documentation;
(b) Refrain from copying or duplicating in any way (other than in the
normal course of performing processing on the Fund's computer(s)), the
Proprietary Information;
(c) Refrain from obtaining unauthorized access to any portion of the
Proprietary Information, and if such access is inadvertently obtained, to
inform in a timely manner of such fact and dispose of such information in
accordance with the Transfer Agent's instructions;
(d) Refrain from causing or allowing information transmitted from the
Transfer Agent's computer to the Fund's terminal to be retransmitted to any
other computer terminal or
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other device except as expressly permitted by the Transfer Agent (such
permission not to be unreasonably withheld);
(e) Allow the Fund to have access only to those authorized transactions as
agreed to between the Fund and the Transfer Agent; and
(f) Honor all reasonable written requests made by the Transfer Agent to
protect at the Transfer Agent's expense the rights of the Transfer Agent in
Proprietary Information at common law, under federal copyright law and
under other federal or state law.
7.2 Proprietary Information shall not include all or any portion of any of the
foregoing items that: (i) are or become publicly available without breach
of this Agreement; (ii) are released for general disclosure by a written
release by the Transfer Agent; or (iii) are already in the possession of
the receiving party at the time of receipt without obligation of
confidentiality or breach of this Agreement.
7.3 The Fund acknowledges that its obligation to protect the Transfer Agent's
Proprietary Information is essential to the business interest of the
Transfer Agent and that the disclosure of such Proprietary Information in
breach of this Agreement would cause the Transfer Agent immediate,
substantial and irreparable harm, the value of which would be extremely
difficult to determine. Accordingly, the parties agree that, in addition to
any other remedies that may be available in law, equity, or otherwise for
the disclosure or use of the Proprietary Information in breach of this
Agreement, the Transfer Agent shall be entitled to seek and obtain a
temporary restraining order, injunctive relief, or other equitable relief
against the continuance of such breach.
7.4 If the Fund notifies the Transfer Agent that any of the Data Access
Services do not operate in material compliance with the most recently
issued user documentation for such services, the Transfer Agent shall
endeavor in a timely manner to correct such failure. Organizations from
which the Transfer Agent may obtain certain data included in the Data
Access Services are solely responsible for the contents of such data and
the Fund agrees to make no claim against the Transfer Agent arising out of
the contents of such third-party data, including, but not limited to, the
accuracy thereof. DATA ACCESS SERVICES AND ALL COMPUTER PROGRAMS AND
SOFTWARE SPECIFICATIONS USED IN CONNECTION THEREWITH ARE PROVIDED ON AN AS
IS, AS AVAILABLE BASIS. THE TRANSFER AGENT EXPRESSLY DISCLAIMS ALL
WARRANTIES EXCEPT THOSE EXPRESSLY STATED HEREIN INCLUDING, BUT NOT LIMITED
TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR
PURPOSE.
7.5 If the transactions available to the Fund include the ability to originate
electronic instructions to the Transfer Agent in order to (i) effect the
transfer or movement of cash or Shares or (ii) transmit Shareholder
information or other information, then in such event the Transfer Agent
shall be entitled to rely on the validity and authenticity of such
instruction without undertaking any further inquiry as long as such
instruction is undertaken in conformity with security procedures
established by the Transfer Agent from time to time.
7.6 Each party shall take reasonable efforts to advise its employees of their
obligations pursuant to this Section 7. The obligations of this Section
shall survive any earlier termination of this Agreement.
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8. Indemnification
8.1 The Transfer Agent shall not be responsible for, and the Fund shall
indemnify and hold the Transfer Agent harmless from and against, any and
all losses, damages, costs, charges, counsel fees, payments, expenses and
liability arising out of or attributable to:
(a) All actions of the Transfer Agent or its agents or subcontractors
required to be taken pursuant to this Agreement (including the defense of
any law suit in which the Transfer Agent or affiliate is a named party),
provided that such actions are taken in good faith and without negligence
or willful misconduct;
(b) The Fund's lack of good faith, negligence or willful misconduct;
(c) The reliance upon, and any subsequent use of or action taken or
omitted, by the Transfer Agent, or its agents or subcontractors on: (i) any
information, records, documents, data, stock certificates or services,
which are received by the Transfer Agent or its agents or subcontractors by
machine readable input, facsimile, CRT data entry, electronic instructions
or other similar means authorized by the Fund, and which have been
prepared, maintained or performed by the Fund or any other person or firm
on behalf of the Fund including but not limited to any broker-dealer, TPA
or previous transfer agent; (ii) any instructions or requests of the Fund
or any of its officers; (iii) any instructions or opinions of legal counsel
with respect to any matter arising in connection with the services to be
performed by the Transfer Agent under this Agreement which are provided to
the Transfer Agent after consultation with such legal counsel; or (iv) any
paper or document, reasonably believed to be genuine, authentic, or signed
by the proper person or persons;
(d) The offer or sale of Shares in violation of federal or state securities
laws or regulations requiring that such Shares be registered or in
violation of any stop order or other determination or ruling by any federal
or any state agency with respect to the offer or sale of such Shares;
(e) The negotiation and processing of any checks including without
limitation for deposit into the Fund's demand deposit account maintained by
the Transfer Agent; or
(f) Upon the Fund's request entering into any agreements required by the
NSCC for the transmission of Fund or Shareholder data through the NSCC
clearing systems.
8.2 In order that the indemnification provisions contained in this Section 8
shall apply, upon the assertion of a claim for which the Fund may be
required to indemnify the Transfer Agent, the Transfer Agent shall promptly
notify the Fund of such assertion, and shall keep the Fund advised with
respect to all developments concerning such claim. The Fund shall have the
option to participate with the Transfer Agent in the defense of such claim
or to defend against said claim in its own name or in the name of the
Transfer Agent. The Transfer Agent shall in no case confess any claim or
make any compromise in any case in which the Fund may be required to
indemnify the Transfer Agent except with the Fund's prior written consent.
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9. Standard of Care
The Transfer Agent shall at all times act in good faith and agrees to use
its best efforts within reasonable limits to ensure the accuracy of all
services performed under this Agreement, but assumes no responsibility and
shall not be liable for loss or damage due to errors, including encoding
and payment processing errors, unless said errors are caused by its
negligence, bad faith, or willful misconduct or that of its employees or
agents. The parties agree that any encoding or payment processing errors
shall be governed by this standard of care and Section 4-209 of the Uniform
Commercial Code is superseded by Section 9 of this Agreement. This standard
of care also shall apply to Exception Services, as defined in Section 2.3
herein, but such application shall take into consideration the manual
processing involved in, and time sensitive nature of, Exception Services.
10. Year 2000
The Transfer Agent will take reasonable steps to ensure that its products
(and those of its third-party suppliers) reflect the available technology
to offer products that are Year 2000 ready, including, but not limited to,
century recognition of dates, calculations that correctly compute same
century and multi century formulas and date values, and interface values
that reflect the date issues arising between now and the next one-hundred
years, and if any changes are required, the Transfer Agent will make the
changes to its products at a price to be agreed upon by the parties and in
a commercially reasonable time frame and will require third-party suppliers
to do likewise.
11. Confidentiality
11.1 The Transfer Agent and the Fund agree that they will not, at any time
during the term of this Agreement or after its termination, reveal,
divulge, or make known to any person, firm, corporation or other business
organization, any customers' lists, trade secrets, cost figures and
projections, profit figures and projections, or any other secret or
confidential information whatsoever, whether of the Transfer Agent or of
the Fund, used or gained by the Transfer Agent or the Fund during
performance under this Agreement. The Fund and the Transfer Agent further
covenant and agree to retain all such knowledge and information acquired
during and after the term of this Agreement respecting such lists, trade
secrets, or any secret or confidential information whatsoever in trust for
the sole benefit of the Transfer Agent or the Fund and their successors and
assigns. In the event of breach of the foregoing by either party, the
remedies provided by Section 7.3 shall be available to the party whose
confidential information is disclosed. The above prohibition of disclosure
shall not apply to the extent that the Transfer Agent must disclose such
data to its sub-contractor or Fund agent for purposes of providing services
under this Agreement.
11.2 In the event that any requests or demands are made for the inspection of
the Shareholder records of the Fund, other than request for records of
Shareholders pursuant to standard subpoenas from state or federal
government authorities (i.e., divorce and criminal actions, the Transfer
Agent will endeavor to notify the Fund and to secure instructions from an
authorized officer of the Fund as to such inspection. The Transfer Agent
expressly reserves the right, however, to exhibit the Shareholder records
to any person whenever it is advised by counsel that it may be held liable
for the failure to exhibit the Shareholder records to such person or if
required by law or court order.
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12. Covenants of the Fund and the Transfer Agent
12.1 The Fund shall promptly furnish to the Transfer Agent the following:
(a) A certified copy of the resolution of the Board of Directors of the
Fund authorizing the appointment of the Transfer Agent and the execution
and delivery of this Agreement; and
(b) A copy of the Articles of Incorporation and By-Laws of the Fund and all
amendments thereto.
12.2 The Transfer Agent hereby agrees to establish and maintain facilities and
procedures reasonably acceptable to the Fund for safekeeping of stock
certificates, check forms and facsimile signature imprinting devices, if
any; and for the preparation or use, and for keeping account of, such
certificates, forms and devices.
12.3 The Transfer Agent shall keep records relating to the services to be
performed hereunder, in the form and manner as it may deem advisable. To
the extent required by Section 31 of the Investment Company Act of 1940, as
amended, and the Rules thereunder, the Transfer Agent agrees that all such
records prepared or maintained by the Transfer Agent relating to the
services to be performed by the Transfer Agent hereunder are the property
of the Fund and will be preserved, maintained and made available in
accordance with such Section and Rules, and will be surrendered promptly to
the Fund on and in accordance with its request.
13. Termination of Agreement
13.1 Term. The initial term of this Agreement (the "Initial Term") shall be
three years from the date first stated above unless terminated pursuant to
the provisions of this Section 13. Unless a terminating party gives written
notice to the other party one hundred and twenty (120) days before the
expiration of the Initial Term or any Renewal Term, this Agreement will
renew automatically from year to year (each such year-to-year renewal term
a "Renewal Term"). One hundred and twenty (120) days before the expiration
of the Initial Term or a Renewal Term the parties to this Agreement will
agree upon a Fee Schedule for the upcoming Renewal Term. Otherwise, the
fees shall be increased pursuant to Section 3.5 of this Agreement.
13.2 Early Termination. Notwithstanding anything contained in this Agreement to
the contrary, should the Fund desire to move any of its services provided
by the Transfer Agent hereunder to a successor service provider prior to
the expiration of the then current Initial or Renewal Term, or without the
required notice, the Transfer Agent shall make a good faith effort to
facilitate the conversion on such prior date; however, there can be no
guarantee or assurance that the Transfer Agent will be able to facilitate a
conversion of services on such prior date. In connection with the
foregoing, should services be converted to a successor service provider, or
if the Fund is liquidated or its assets merged or purchased or the like
with or by another entity which does not utilize the services of the
Transfer Agent, the Fund shall pay to the Transfer Agent on or before the
termination date all fees hereunder accrued to such termination date and
then unpaid plus a termination fee of twenty-five thousand dollars
($25,000.00).
11
13.3 Expiration of Term. During the Initial Term or Renewal Term, whichever
currently is in effect, should either party exercise its right to
terminate, all out-of-pocket expenses or costs associated with the movement
of records and material will be borne by the Fund. Additionally, the
Transfer Agent reserves the right to charge for any other reasonable
expenses associated with such termination.
13.4 Confidential Information. Upon termination of this Agreement, each party
shall return to the other party all copies of confidential or proprietary
materials or information received from such other party hereunder, other
than materials or information required to be retained by such party under
applicable laws or regulations.
13.5 Unpaid Invoices. The Transfer Agent may terminate this Agreement
immediately upon an unpaid invoice payable by the Fund to the Transfer
Agent being outstanding for more than ninety (90) days, except with respect
to any amount subject to a good faith dispute within the meaning of Section
3.4 of this Agreement.
13.6 Bankruptcy. Either party hereto may terminate this Agreement by notice to
the other party, effective at any time specified therein, in the event that
(a) the other party ceases to carry on its business or (b) an action is
commenced by or against the other party under Title 11 of the United States
Code or a receiver, conservator or similar officer is appointed for the
other party and such suit, conservatorship or receivership is not
discharged within thirty (30) days.
14. Assignment and Third Party Beneficiaries
14.1 Except as provided in Section 15.1 below, neither this Agreement nor any
rights or obligations hereunder may be assigned by either party without the
written consent of the other party. Any attempt to do so in violation of
this Section shall be void. Unless specifically stated to the contrary in
any written consent to an assignment, no assignment will release or
discharge the assignor from any duty or responsibility under this
Agreement.
14.2 Except as explicitly stated elsewhere in this Agreement, nothing under this
Agreement shall be construed to give any rights or benefits in this
Agreement to anyone other than the Transfer Agent and the Fund, and the
duties and responsibilities undertaken pursuant to this Agreement shall be
for the sole and exclusive benefit of the Transfer Agent and the Fund. This
Agreement shall inure to the benefit of and be binding upon the parties and
their respective permitted successors and assigns.
14.3 This Agreement does not constitute an agreement for a partnership or joint
venture between the Transfer Agent and the Fund. Other than as provided in
Section 15.1 and Schedule 1.2(f), neither party shall make any commitments
with third parties that are binding on the other party without the other
party's prior written consent.
15. Subcontractors
15.1 The Transfer Agent may, without further consent on the part of the Fund,
subcontract for the performance hereof with (i) Boston Financial Data
Services, Inc., a Massachusetts corporation ("BFDS") which is duly
registered as a transfer agent pursuant to Section 17A(c)(2) of the
Securities Exchange Act of 1934, as amended, (ii) a BFDS subsidiary duly
registered as a transfer agent or (iii) a BFDS affiliate duly registered as
a transfer
12
agent; provided, however, that the Transfer Agent shall be fully
responsible to the Fund for the acts and omissions of BFDS or its
subsidiary or affiliate as it is for its own acts and omissions.
15.2 Nothing herein shall impose any duty upon the Transfer Agent in connection
with or make the Transfer Agent liable for the actions or omissions to act
of unaffiliated third parties such as by way of example and not limitation,
Airborne Services, Federal Express, United Parcel Service, the U.S. Mails,
the NSCC and telecommunication companies, provided, if the Transfer Agent
selected such company, the Transfer Agent shall have exercised due care in
selecting the same.
16. Miscellaneous
16.1 Amendment. This Agreement may be amended or modified by a written agreement
executed by both parties and authorized or approved by a resolution of the
Board of Directors of the Fund.
16.2 Massachusetts Law to Apply. This Agreement shall be construed and the
provisions thereof interpreted under and in accordance with the laws of The
Commonwealth of Massachusetts.
16.3 Force Majeure. In the event either party is unable to perform its
obligations under the terms of this Agreement because of acts of God,
strikes, equipment or transmission failure or damage reasonably beyond its
control, or other causes reasonably beyond its control, such party shall
not be liable for damages to the other for any damages resulting from such
failure to perform or otherwise from such causes.
16.4 Consequential Damages. Neither party to this Agreement shall be liable to
the other party for special, indirect or consequential damages under any
provision of this Agreement or for any special, indirect or consequential
damages arising out of any act or failure to act hereunder.
16.5 Survival. All provisions regarding indemnification, warranty, liability,
and limits thereon, and confidentiality and/or protections of proprietary
rights and trade secrets shall survive the termination of this Agreement.
16.6 Severability. If any provision or provisions of this Agreement shall be
held invalid, unlawful, or unenforceable, the validity, legality, and
enforceability of the remaining provisions shall not in any way be affected
or impaired.
16.7 Priorities Clause. In the event of any conflict, discrepancy or ambiguity
between the terms and conditions contained in this Agreement and any
Schedules or attachments hereto, the terms and conditions contained in this
Agreement shall take precedence.
16.8 Waiver. No waiver by either party or any breach or default of any of the
covenants or conditions herein contained and performed by the other party
shall be construed as a waiver of any succeeding breach of the same or of
any other covenant or condition.
16.9 Merger of Agreement. This Agreement constitutes the entire agreement
between the parties hereto and supersedes any prior agreement with respect
to the subject matter hereof whether oral or written.
13
16.10 Counterparts. This Agreement may be executed by the parties hereto on any
number of counterparts, and all of said counterparts taken together shall
be deemed to constitute one and the same instrument.
16.11 Reproduction of Documents. This Agreement and all schedules, exhibits,
attachments and amendments hereto may be reproduced by any photographic,
photostatic, microfilm, micro-card, miniature photographic or other
similar process. The parties hereto each agree that any such reproduction
shall be admissible in evidence as the original itself in any judicial or
administrative proceeding, whether or not the original is in existence
and whether or not such reproduction was made by a party in the regular
course of business, and that any enlargement, facsimile or further
reproduction shall likewise be admissible in evidence.
16.12 Notices. All notices and other communications as required or permitted
hereunder shall be in writing and sent by first class mail, postage
prepaid, addressed as follows or to such other address or addresses of
which the respective party shall have notified the other.
(a) If to State Street Bank and Trust Company, to:
State Street Bank and Trust Company
c/o Boston Financial Data Services, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Legal Department
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
(b) If to the Fund, to:
Attention:
14
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
in their names and on their behalf by and through their duly authorized
officers, as of the day and year first above written.
▇▇▇▇▇ & STEERS SPECIAL EQUITY FUND, INC.
BY: __________________________________
ATTEST:
______________________________________
STATE STREET BANK AND TRUST COMPANY
BY: __________________________________
Vice Chairman
ATTEST:
______________________________________
15
SCHEDULE 1.2(f)
ADDITIONAL TELEPHONE SUPPORT FEES AND SERVICES
Dated ____________________________
I. SERVICES
1. Transfer Agent and Telephone Support Functions
a. Answer telephone inquiries from [XXX 8 a.m. to 8 p.m. Boston time
Monday through Firday except Christmas Day XXX] [XXX OTHER HOLIDAY
COVERAGE AVAILABLE? XXX] from [XXX existing customers and prospective
customers XXX] of the Fund [XXX for sales literature XXX] in
accordance with the telephone script provided by the Fund.
b. Answer questions pertaining thereto the intent that such questions are
asnwerable based upon the information supplied to the Transfer Agent
by the Fund.
c. [XXX As the Fund and the Transfer Agent may agree in writing, the
Transfer Agent will receive calls and take written transaction
requests from shareholders of the Fund. Transfer Agent transactions
include: [XXX telephone redemptions, account maintenance, exchanges,
transfers, confirmed purchases, account balances and general inquiries
XXX]. Some transactions may result in research which will be done by
the Fund. Other calls may be referred directly tot eh Fund. Fax any
referreals to [XXX name of company XXX] on the same day the telephone
call is received XXX].
2. Incorporate new information into the above-referenced script upon written
instructions from the Fund;
3. Maintain prospect detail information for six (6) months thereafter, provide
such information to the Fund in the form that the Fund may reasonably
request;
4. Send all literature orders for information from BFDS/DST [XXX [how?] [to
whom?] XXX] a minimym of [XXX one XXX] transmission per day;
5. Provide the Fund with a [XXX daily/weekly/monthly XXX] telephone report
detailing the calls received during the [XXX day/week/month XXX];
6. [XXX Provide the Fund with monthly conversion reports as selected by the
Fund from DST's standard report pacakge. XXX]
7. TARGET SERVICE LEVELS: Average speed of answer is fifteen (15) seconds,
abandon rate of no more than 2%, and an overall service level of 85%. The
averages will be calculated on a weekly basis.
II. SUBCONTRACTORS
1. The Transfer Agent may, without further consent on the part of the Fund,
subcontract ministerial telephone support services for the performance
hereof.
III. FEES
STATE STREET BANK AND TRUST
COMPANY
BY:____________________________________ BY:___________________________________
2
SCHEDULE 2.1
THIRD PARTY ADMINISTRATOR(S) PROCEDURES
Dated_______________
1. On each day on which both the New York Stock Exchange and the Fund are open
for business (a "Business Day"), the TPA(s) shall receive, on behalf of and
as agent of the Fund, Instructions (as hereinafter defined) from the Plan.
Instructions shall mean as to each Fund (i) orders by the Plan for the
purchases of Shares, and (ii) requests by the Plan for the redemption of
Shares; in each case based on the Plan's receipt of purchase orders and
redemption requests by Participants in proper form by the time required by
the terms of the Plan, but not later than the time of day at which the net
asset value of a Fund is calculated, as described from time to time in that
Fund's prospectus. Each Business Day on which the TPA receives Instructions
shall be a "Trade Date".
2. The TPA(s) shall communicate the TPA(s)'s acceptance of such Instructions,
to the applicable Plan.
3. On the next succeeding Business Day following the Trade Date on which it
accepted Instructions for the purchase and redemption of Shares, (TD+1),
the TPA(s) shall notify the Transfer Agent of the net amount of such
purchases or redemptions, as the case may be, for each of the Plans. In the
case of net purchases by any Plan, the TPA(s) shall instruct the Trustees
of such Plan to transmit the aggregate purchase price for Shares by wire
transfer to the Transfer Agent on (TD+1). In the case of net redemptions by
any Plan, the TPA(s) shall instruct the Fund's custodian to transmit the
aggregate redemption proceeds for Shares by wire transfer to the Trustees
of such Plan on (TD+1). The times at which such notification and
transmission shall occur on (TD+1) shall be as mutually agreed upon by each
Fund, the TPA(s), and the Transfer Agent.
4. The TPA(s) shall maintain separate records for each Plan, which record
shall reflect Shares purchased and redeemed, including the date and price
for all transactions, and Share balances. The TPA(s) shall maintain on
behalf of each of the Plans a single master account with the Transfer Agent
and such account shall be in the name of that Plan, the TPA(s), or the
nominee of either thereof as the record owner of Shares owned by such Plan.
5. The TPA(s) shall maintain records of all proceeds of redemptions of Shares
and all other distributions not reinvested in Shares.
6. The TPA(s) shall prepare, and transmit to each of the Plans, periodic
account statements showing the total number of Shares owned by that Plan as
of the statement closing date, purchases and redemptions of Shares by the
Plan during
the period covered by the statement, and the dividends and
other distributions paid to the Plan on Shares during the statement period
(whether paid in cash or reinvested in Shares).
7. The TPA(s) shall, at the request and expense of each Fund, transmit to the
Plans prospectuses, proxy materials, reports, and other information
provided by each Fund for delivery to its shareholders.
8. The TPA(s) shall, at the request of each Fund, prepare and transmit to each
Fund or any agent designated by it such periodic reports covering Shares of
each Plan as each Fund shall reasonably conclude are necessary to enable
the Fund to comply with state Blue Sky requirements.
9. The TPA(s) shall transmit to the Plans confirmation of purchase orders and
redemption requests placed by the Plans; and
10. The TPA(s) shall, with respect to Shares, maintain account balance
information for the Plan(s) and daily and monthly purchase summaries
expressed in Shares and dollar amounts.
11. Plan sponsors may request, or the law may require, that prospectuses, proxy
materials, periodic reports and other materials relating to each Fund be
furnished to Participants in which event the Transfer Agent or each Fund
shall mail or cause to be mailed such materials to Participants. With
respect to any such mailing, the TPA(s) shall, at the request of the
Transfer Agent or each Fund, provide at the TPA(s)'s expense a complete and
accurate set of mailing labels with the name and address of each
Participant having an interest through the Plans in Shares.
▇▇▇▇▇ & STEERS SPECIAL EQUITY STATE STREET BANK AND TRUST
FUND, INC. COMPANY
BY: _________________________ BY: _______________________
2
SCHEDULE 3.1
FEES
Effective ___________________ through ________________
General: Fees are calculated on average daily net assets and are billed on a
monthly basis at the rate of 1/12 of the annual fee, subject to a minimum
$500,000 complex fee.
Annual Account Services Fees
----------------------------
Account Service Fees 4.0 Basis Points for $0 - $2 Billion
3.0 Basis Points for $2 Billion - $5 Billion
2.0 Basis Points for $5 Billion +
Activity Base Fees
------------------
New Account Setup $ 4.00/each
Financial Transactions (Non NSCC) $ 4.00/each
Shareholder Service Telephone Calls $ 1.50/per minute
▇▇▇ Custodial Fees
------------------
Annual Maintenance (if applicable) $ 10.00/Account
Out-of-Pocket Expenses Billed as incurred
----------------------
Out-of-Pocket expenses include but are not limited to: confirmation statements,
investor statements, postage, forms, voice response, telephone, bank services,
records retention, customized programming/enhancements, federal wire,
transcripts, microfilm, microfiche, year-end forms, proxy mailing, proxy
tabulation, and expenses incurred at the specific direction of the Fund.
▇▇▇▇▇ & STEERS SPECIAL EQUITY STATE STREET BANK AND
FUND, INC. TRUST COMPANY
BY: _________________________ BY: _________________________
