1933 Act File No. N/A
1940 Act File No. 811-2626
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Pre-Effective Amendment No.
Post-Effective Amendment No.
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 X
Amendment No. 15 X
FEDERATED EXCHANGE FUND, LTD.
(Exact Name of Registrant as Specified in Charter)
Federated Investors Tower, Pittsburgh, Pennsylvania 15222-3779
(Address of Principal Executive Offices)
(412) 288-1900
(Registrant's Telephone Number)
John W. McGonigle, Esquire,
Federated Investors Tower,
Pittsburgh, Pennsylvania 15222-3779
(Name and Address of Agent for Service)
Copies to:
Matthew G Maloney, Esquire
Dickstein, Shapiro & Morin, L.L.P.
2101 L Street, N.W.
Washington, D.C. 20037
PART A.
Item 1. Cover Page
Not applicable.
Item 2. Synopsis
Not applicable.
Item 3. Condensed Financial Information
Financial Highlights
Supplementary Information
(For a share outstanding throughout each period)
Year Ended December 31,
1994 1993 1992 1991 1990
Net asset value, beginning of period $71.39 $65.83 $61.65 $50.56 $54.93
Income from investment operations
Net investment income 1.18 1.13 1.36 1.16 1.46
Net realized and unrealized gain
(loss) on investments (1.39) 6.30 5.57 12.62 (3.86)
Total from investment operations (0.21) 7.43 6.93 13.78 (2.40)
Less distributions
Dividends to partners from net
investment incom (1.14) (1.16) (1.38) (1.15) (1.51)
Distributions to partners from
net realized gain on investment
transactions (1.20) (0.71) (1.37) (1.54) (0.46)
Total distributions (2.34) (1.87) (2.75) (2.69) (1.97)
Net asset value, end of period $68.84 $71.39 $65.83 $61.65 $50.56
Total return* (.30%) 11.31% 11.38% 27.42% (4.43%)
Ratios to average net assets
Expenses 1.15% 1.15% 1.11% 1.12% 1.07%
Net investment income 1.63% 1.59% 2.13% 1.97% 2.76%
Supplemental Data
Net assets, end of period
(000 omitted) $81,377 $88,949 $91,551 $90,503 $79,114
Portfolio turnover rate 23% 26% 47% 54% 61%
* Based on net asset value, which does not reflect the sales load or contingent
deferred sales charge, if applicable.
Year Ended December 31,
1989 1988 1987 1986 1985
Net asset value, beginning of period $50.03 $46.19 $48.39 $43.27 $33.94
Income from investment operations
Net investment income 1.37 1.31 1.29 1.20 1.24
Net realized and unrealized gain
(loss) on investments 7.34 5.08 (0.45) 6.27 10.47
Total from investment operations 8.71 6.39 0.84 7.47 11.71
Less distributions
Dividends to partners from net
investment income (1.32) (1.29) (1.30) (1.22) (1.24)
Distributions to partners from
net realized gain on investment
transactions (2.49) (1.26) (1.74) (1.13) (1.14)
Total distributions (3.81) (2.55) (3.04) (2.35) (2.38)
Net asset value, end of period $54.93 $50.03 $46.19 $48.39 $43.27
Total return* 17.58% 13.97% 0.88% 17.31% 35.37%
Ratios to average net assets
Expenses 1.13% 1.08% 0.92% 0.94% 0.99%
Net investment income 2.45% 2.61% 2.29% 2.43% 3.13%
Supplemental Data
Net assets, end of period
(000 omitted) $95,422 $89,228 $89,371 $106,360 $103,877
Portfolio turnover rate 41% 36% 39% 17% 18%
* Based on net asset value, which does not reflect the sales load or contingent
deferred sales charge, if applicable.
Further information about the Fund's performance is contained in the Fund's
annual report dated December 31, 1995, which can be obtained free of charge.
Item 4. General Description of Registrant
(a) The Registrant is a diversified management investment
company organized as a California limited partnership under the
provisions of The Uniform Limited Partnership Act as enacted in
California pursuant to the Registrant's Certificate and Agreement of
Limited Partnership dated February 27, 1976. The Partnership
Agreement was restated on September 1, 1976.
The investment objective of the Registrant is to seek long-term
growth of capital and of income. The Registrant accepted for
deposit, and invests its assets in a broadly diversified portfolio
of
securities which, in the opinion of the Managing General Partners,
meets its investment objective. The Registrant's investment
objective and its policies stated herein and in Item 4(b) may not be
changed without a vote of the Partners. The Registrant invests its
assets principally in common stocks which, in the opinion of the
Managing General Partners, have potential for growth of capital and
of income. There is, however, no requirement that the Registrant
invest exclusively in common stocks and, if deemed advisable for the
attainment of its investment objective, the Registrant may invest in
other corporate securities such as preferred stocks,
corporate bonds,
notes and warrants, or in municipal and government obligations, or
cash and cash items, including but not limited to short-term
obligations such as certificates of deposit, short-term notes and
repurchase agreements, all in such proportions as the Managing
General Partners may determine. The Registrant will invest in
short-
term obligations in order to keep its cash reserves and temporary
funds invested and may also invest in such securities for defensive
purposes. The Registrant will not enter into repurchase agreements
with securities dealers if such transactions constitute the purchase
of an interest in such dealers under the Investment Company Act of
1940, as amended. The Registrant may write exchange traded call
options on portfolio securities as permitted hereunder. The
Registrant may write call options on securities constituting
not more
than 25% of the value of its net assets if the option is listed on a
national securities exchange and at all times while the option is
outstanding the Registrant owns securities against which the option
is written or owns securities convertible into such securities. The
Registrant will endeavor to liquidate its position as an option
writer in a closing purchase transaction rather than delivering
portfolio securities upon exercise of the option. The extent to
which the Registrant may be able to write such options will
depend in
part on state securities regulations, as amended from time to time.
The Registrant accepted for exchange, and may invest its assets in,
securities which, in the opinion of counsel of the Registrant, are
subject to restrictions on sale by the Registrant by reason of any
agreement of the depositor of such securities, by reason of the
provisions of the Securities Act of 1933 and the rules and
regulations thereunder or otherwise. While the Registrant cannot
eliminate the risks of ownership of common stock and
other securities
nor give any assurance that it will achieve its investment
objective, it does seek, through professional management
and diversification, to
reduce these risks and enhance the Partners' opportunities for long-
term growth of capital and of income.
If management deems it advisable for the attainment of the
Registrant's investment objective, it may invest up to 25% of the
value of the Registrant's assets in any one industry. The
Registrant
may, at times, invest more than 25% of the value of its assets in
cash or cash items, U.S. Treasury bills or securities issued or
guaranteed by the U.S. government, its agencies or instrumentalities
or instruments secured by those money market instruments, such as
repurchase agreements, for defensive purposes. If, because of
changing values, the value of the Registrant's assets invested in a
particular industry exceeds 25% of the value of its assets, the
Registrant will not be required to make any reduction of its
holdings in that particular industry.
The prices of fixed income securities fluctuate inversely to the
direction of interest rates.
(b) The Registrant has limited the percentage of restricted
securities that it will acquire to 10% of the total value of its
assets. Securities acquired pursuant to an effective Registration
Statement under the Securities Act of 1933 will not be considered
restricted securities.
No security that is subject to the restriction will be
distributed in case of redemption in kind, except possibly to a
redeeming shareholder who had originally deposited that particular
security. No other disposition of such securities will be made by
the Registrant unless the Registrant has obtained an opinion of its
counsel at the time that such securities may be disposed of
consistent with the Securities Act of 1933.
In general, restricted securities can be sold: (a) in limited
quantities in the public market after having been held beneficially
for at least two years; (b) in privately negotiated transactions
to a limited number of purchasers; or (c) in a public
offering pursuant to
an effective registration statement under the Securities
Act of 1933.
The Registrant may not borrow money except as a temporary
measure for extraordinary or emergency purposes and then only in
amounts not in excess of 10% of the value of its total assets. The
Registrant will not borrow for investment purposes. Investment
securities will not be purchased while any borrowings are
outstanding.
The Registrant will not purchase the securities of an issuer
if, as a result of such purchase, the Registrant would hold more than
5% of the value of Registrant's assets in such issuer.
The Registrant will not purchase more than 10% of the value of
any issuer's total outstanding voting securities.
The Registrant will not invest more than 5% of its assets in
any issuer having a record of less than 3 continuous years of
operation, including any predecessor's operation.
The Registrant will not purchase warrants of a value in excess
of 5% of Registrant's net assets except in certain circumstances.
(c) In return for the premium income received on a call
option, the Registrant forgoes the opportunity to profit from an
increase in the price of the underlying security above the option's
exercise price during the time the Registrant's position as an option
writer is open.
Generally, restricted securities will be subject to legal or
contractual delays on resale or restriction on resale and may sell at
a discount from the price they would bring if freely marketable.
Item 5. Management of the Registrant
(a) The Registrant is managed by a Board of Managing General
Partners. The Managing General Partners are responsible for managing
the Registrant's business affairs and for exercising all the
Registrant's powers except those reserved for the partners. An
Executive Committee of the Board of Managing General Partners handles
the Board's responsibilities between meetings of the Board.
(b) Investment decisions for the Registrant are made by
Federated Advisers, the Registrant's investment adviser (the
"Adviser"), subject to direction by the Managing General Partners.
The Adviser continually conducts investment research and supervision
for the Registrant and is responsible for the purchase or sale of
portfolio instruments, for which it receives an annual fee from the
Registrant.
The Adviser receives an annual investment advisory fee equal to
0.55% of the Registrant's average daily net assets, plus 4.5% of
gross income of the Registrant. Gross income includes, in general,
discount earned on U.S. Treasury bills and agency discount notes,
interest received or receivable on all interest-bearing obligations
and dividend income recorded on the ex-dividend date, but does not
include capital gains or losses or a reduction for expenses. The
Adviser may, from time to time and for such periods as it deems
appropriate, reduce its compensation (and, if appropriate, assume
expenses of the Registrant) to the extent that the Registrant's
expenses exceed such lower expense limitation as the Adviser may, by
notice to the Registrant, voluntarily declare to be effective. The
Adviser has also undertaken to reimburse the Registrant for operating
expenses in excess of limitations established by certain states.
Federated Advisers, a Delaware business trust organized on
April 11, 1989, is a registered investment adviser under the
Investment Advisers Act of 1940, as amended. It is a subsidiary of
Federated Investors. All of the Class A (voting) shares of Federated
Investors are owned by a trust, the trustees of which are John F.
Donahue, Chairman and Trustee of Federated Investors, Mr. Donahue's
wife, and Mr. Donahue's son, J. Christopher Donahue, who is President
and Trustee of Federated Investors.
Federated Advisers and other subsidiaries of Federated
Investors serve as investment advisers to a number of investment
companies and private accounts. Certain other subsidiaries also
provide administrative services to a number of investment companies.
Total assets under management or administration by these and other
subsidiaries of Federated Investors are approximately $70 billion.
(c) Peter R. Anderson has been the Registrant's senior
portfolio manager since December 1989. Mr. Anderson joined Federated
Investors in 1972 as, and is presently, a Senior Vice President of
the Fund's investment adviser. Mr. Anderson is a Chartered Financial
Analyst and received his M.B.A. in Finance from the University of
Wisconsin.
Frederick L. Plautz has been the Registrant's co-portfolio
manager since December, 1994. Mr. Plautz joined Federated
Investors in 1990 and has been a Vice President of the Fund's
investment adviser since October 1994. Prior to this, Mr.
Plautz served as an Assistant Vice President of the investment
adviser. Mr. Plautz was a portfolio manager at Banc One Asset
Management Corp. from 1986 until 1990. Mr. Plautz received his
M.S. in Finance from the University of Wisconsin.
Timothy E. Keefe has been the Registrant's co-portfolio manager
since February, 1995. Mr. Keefe joined Federated Investors in
1987 and has been an Assistant Vice President of the Fund's
investment adviser since 1993. Mr. Keefe served as an
Investment Analyst of the investment adviser from 1991 until
1993, and from 1987 until 1991 he acted as a Marketing
Representative in the Broker Dealer Department. Mr. Keefe is a
Chartered Financial Analyst and received his M.B.A. in Business
Administration from the University of Pittsburgh.
(d) Federated Administrative Services, a subsidiary of
Federated Investors, provides administrative personnel and services
(including certain legal and financial reporting services) necessary
to operate the Registrant. Federated Administrative Services
provides these at an annual rate which relates to the average
aggregate daily net assets of all funds advised by subsidiaries of
Federated Investors ("Federated Funds") as specified below:
Average Aggregate Daily Net Assets
Maximum Administrative Fee of the Federated Funds
0.15 of 1% on the first $250 million
0.125 of 1% on the next $250 million
0.10 of 1% on the next $250 million
0.075 of 1% on assets in excess of $750 million
The administrative fee received during any fiscal year shall be
at least $125,000 per portfolio and $30,000 per each additional class
of shares. Federated Administrative Services may choose voluntarily
to waive a portion of its fee.
The Registrant has adopted a Shareholder Services Plan (the
"Services Plan") under which it may make payments of up to 0.25% of
the average daily net asset value of the Registrant to obtain certain
personal services for shareholders and the maintenance of shareholder
accounts ("shareholder services"). The Registrant has entered into a
Shareholder Services Agreement with Federated Shareholder Services, a
subsidiary of Federated Investors, under which Federated Shareholder
Services will either perform shareholder services directly or will
select financial institutions to perform shareholder services.
Financial institutions will receive fees based upon shares owned by
their clients or customers. The schedules of such fees and the basis
upon which such fees will be paid will be determined from time to
time by the Registrant and Federated Shareholder Services.
(e) Federated Services Company, Pittsburgh, Pennsylvania,
serves as transfer agent and dividend disbursing agent for the
Registrant. The fee paid to the transfer agent is based upon the
size, type and number of accounts and transactions made by
shareholders. Federated Services Company also maintains the Fund's
accounting records. The fee paid for this service is based upon the
level of the Fund's average net assets for the period plus out-of-
pocket expenses.
(f) See response to Item 3.
(g) None.
Item 6. Capital Stock and Other Securities
(a) The Partners have the voting, approval, consent, or
similar rights required under the Investment Company Act of 1940, as
amended, for voting Shareholders. Partners have one vote for each
share held by them as reflected in the Partnership Agreement. At
each annual meeting, the Partners vote upon the election of each of
the General Partners. At their annual meeting held November 9, 1992,
the Partners approved an amendment to the Agreement of Limited
Partnership to eliminate the annual meeting requirement, except as
otherwise required by the Investment Company Act of 1940, as amended.
Partners may vote in person or by proxy. The presence in person
or by proxy of Partners holding more than 50% of the outstanding
shares as reflected in the Partnership Agreement constitutes a quorum
at any meeting. Other than the election of General Partners or a
vote to terminate the Partnership, actions of the Partners will
require the vote of the lesser of (i) a majority of the outstanding
shares or (ii) the vote of 67% or more of the shares represented in
person or by proxy at a meeting at which a quorum is present. In the
election of General Partners, if required, those candidates receiving
the highest number of votes cast, up to the number of General
Partners to be elected, shall be elected to serve until their
successors are duly elected and qualified. Action to terminate the
Partnership shall require the vote of a majority of the outstanding
shares. Voting rights are not cumulative, so that the holders of
more than 50% of the shares voting in the election of General
Partners can, if they choose to do so, elect all of the General
Partners, in which case the holders of the remaining shares will be
unable to elect any person as a General Partner.
The General Partners are divided into two classes: Managing
General Partners and Non-Managing General Partners. Only individuals
may act as Managing General Partners. All individual General
Partners shall act as Managing General Partners. A Non-Managing
General Partner as such shall generally take no part in the
management, conduct, or operation of the Registrant's business. The
Registrant will be managed by the Managing General Partners. The
Managing General Partners may appoint an Executive Committee of at
least two Managing General Partners who would exercise the powers of
the Managing General Partners between meetings of the Managing
General Partners. Except pursuant to such appointment or other
delegated authority of the Managing General Partners, the Registrant
shall act only by majority vote. A single Managing General Partner
or Managing General Partners constituting less than a majority of
Managing General Partners, shall not have authority to act on behalf
of the Registrant or to bind the Registrant, except when acting as an
Executive Committee or otherwise pursuant to delegated authority of
the Managing General Partners. The Managing General Partners are in
a fiduciary relationship with respect to the Limited Partners,
similar to that of the directors of a corporation to its
shareholders. All General Partners, including Managing and
Non-Managing General Partners, shall be subject to election and
removal by vote of the Partners.
Limited Partners generally are not personally liable for
liabilities of the Registrant. However, if the Registrant were
unable to pay its liabilities, recipients of distributions from the
Registrant could be liable to certain creditors of the Registrant to
the extent of such distributions, plus interest. The Partnership
will, to the extent of its net assets, indemnify the Limited Partners
or former Limited Partners against any liability which is incurred
because of the receipt of a distribution which has to be returned to
creditors in satisfaction of Partnership liability. If the
Partnership's net assets are insufficient to indemnify the Limited
Partners in full, the Partnership will attempt to recover from other
Limited Partners who received such distributions their proportionate
share of such liability. Each Limited Partner agrees to indemnify
each other Limited Partner against such liability to the extent of
his proportionate share of such liability. Each Limited Partner, by
becoming a Limited Partner, consents to pro rata distributions to
holders of shares which may constitute, in whole or in part, returns
of contributions with respect to such shares.
A Limited Partner has no right to and takes no part in control
of the Partnership business, but may exercise the rights and powers
of a Limited Partner under the Partnership Agreement, including,
without limitation, the voting rights and the giving of consents and
approvals provided for in the Partnership Agreement. The Partnership
Agreement authorizes Limited Partners to exercise the right to vote
on certain matters, including, without limitation, the voting rights
and the giving of consents and approvals provided for in the
Partnership Agreement. The Partnership Agreement authorizes Limited
Partners to exercise the right to vote on certain matters, including
the right to elect or remove General Partners, in reliance upon
certain provisions contained in The Uniform Limited Partnership Act
as enacted by the State of California, which in substantial form, has
been adopted by most other states. Although no absolute assurance
can be given, due to the lack of specific statutory authority
expressly covering certain of the voting rights given to Limited
Partners, including approval of the Investment Advisory Contract and
any Sub-Advisory Agreement and approval of the independent
accountants of the Registrant, and the fact that there are not
authoritative judicial decisions on the matter, it is the opinion of
California counsel that the existence or exercise of the voting
rights provided for in the Partnership Agreement does not subject the
Limited Partners to liability as General Partners under the
California Act. However, it is possible that, because of the
existence or exercise of such rights, the Limited Partners might be
found to be subject to such liability by the courts of another state.
In the event that a Limited Partner should be found to be liable as a
General Partner, then, to the extent the assets and insurance of the
Registrant and of the General Partners are insufficient to reimburse
a Limited Partner, he would be required to satisfy personally such a
claim.
The Registrant believes it is unlikely that Limited Partners
will receive distributions which will have to be returned or that
they will be subject to liability as General Partners because of the
extent of the assets of the Registrant, the nature of its business,
and its ability to contract with third parties to prevent any such
party from seeking recovery from any Limited Partner. The Registrant
will seek to include in all material contracts a provision limiting
the claims of creditors to the Registrant's assets. The Registrant
intends to obtain such insurance coverage as may be available for
claims asserted against the Registrant or its General Partners in an
amount deemed appropriate by the Managing General Partners. In any
event, the assets of the Registrant should at all times be sufficient
to satisfy the amount of any potential claims against the Registrant.
A Limited Partner can assign the whole or any portion of his
shares by a written instrument of assignment in a form satisfactory
to the Managing General Partners, provided that: (i) the assignee
agrees to become a Substituted Limited Partner and (ii) the Managing
General Partners consent to such assignment and substitution. Any
assignee who has filed with the Registrant the necessary papers to
become a substituted Limited Partner and who has obtained the
requisite consent of the Managing General Partners prior to the
record date for distributions will have the right to receive such
distributions even though the recording of an appropriate amendment
to the Partnership Agreement occurs after the record date. The
admission of an assignee as a substituted Limited Partner is
conditioned upon the assignment instrument being in a form and
substance satisfactory to the Managing General Partners, the
assignee's written acceptance and adoption of all of the terms and
provisions of the Partnership Agreement, and the recording of an
appropriate amendment to the Partnership Agreement. The Managing
General Partners have stated that it is their intention to consent to
assignments by way of gifts or personal estate planning (for example,
transfers to trusts). Since the shares are redeemable in whole or in
part at their net asset value, the giving or withholding of such
consent does not affect the ability of a Partner to realize gain or
loss on his investment.
The Registrant will continue in existence until December 31,
2071, unless sooner terminated by the happening of one of the
following events:
(1) The Registrant disposes of all of its assets; or
(2) The death, withdrawal, retirement, dissolution, assignment
for the benefit of creditors, filing of a petition for
bankruptcy, adjudication of bankruptcy, insanity or incompetency
of (i) any of the General Partners, unless the remaining General
Partners elect to continue the business of the Registrant, (ii)
all of the General Partners, unless a Special Meeting, as
provided for in Section 8.8 of the Partnership Agreement, is
held within six months, or (iii) all of the Managing General
Partners, unless a Special Meeting as provided in Section 8.8,
is held within 120 days of the date the last Managing General
Partner ceased to act in such capacity.
(3) Partners holding a majority of the outstanding shares vote
to terminate the Partnership.
Except by requiring the Registrant to redeem shares as
described hereunder, Limited Partners have no right to the return of
any part of their contributions until dissolution of the Registrant.
Distributions by the Registrant, whether upon dissolution or
otherwise, will be in proportion to the number of shares held,
without regard to the dollar amount contributed to the Registrant or
the amount of any profits of the Registrant received.
(b) Not applicable.
(c) Not applicable.
(d) Not applicable.
(e) Partners may contact the Fund by writing to or calling
the Fund.
(f) The Managing General Partners may distribute net
investment income, exclusive of capital gains, to the holders of
shares of partnership interest annually or at more frequent
intervals. The Managing General Partners will determine annually
what portion, if any, of the Partnership's net realized capital gains
will be distributed.
(g) Each Partner is individually responsible for the payment
of any taxes on his/her share of the partnership's taxable income.
As a publicly traded partnership, this income can not be used to
offset losses of any other passive activity held by the partner.
Item 7. Purchase of Securities Being Offered
Not applicable.
Item 8. Redemption or Repurchase
(a) The Custodian Bank will redeem shares at net asset value
on any business day. Shares will be redeemed at the net asset value
next determined after the receipt of a redemption request in proper
form. A redemption request must be in writing and accompanied by
share certificates, if issued. Redemption requests and share
certificates must be endorsed by the redeeming Partner, with
signature guaranteed by a commercial bank or a trust company whose
deposits are insured by the Bank Insurance Fund ("BIF"), which is
administered by the Federal Deposit Insurance Corporation ("FDIC"); a
member of the New York, American, Boston, Midwest, or Pacific Stock
Exchange; a savings bank or Savings Association Insurance Fund
("SAIF"), which is administered by the FDIC; or any other "eligible
guarantor institution," as defined in the Securities Exchange Act of
1934. The Registrant does not accept signatures guaranteed by a
notary public. In addition, in some cases, additional documents may
be required.
If a redemption request in proper form is received by the
Custodian prior to the close of the New York Stock Exchange, shares
will be redeemed at the net asset value determined at the close of
business on the New York Stock Exchange on the date of receipt. If
received after the close of the New York Stock Exchange or on days on
which the New York Stock Exchange is closed, shares will be redeemed
at the net asset value determined at the close of business on the
next day on which the New York Stock Exchange is open. Redemption
proceeds will be mailed (after the receipt of a redemption request in
proper form) as soon as they are processed, which is normally within
three days of receipt, and will be mailed in any event within seven
business days after receipt.
The Registrant reserves the right, in its complete discretion,
to redeem its shares wholly or partly in portfolio securities
("redemption in kind") instead of in cash, and to deliver one or more
portfolio securities in satisfaction of the redemption request
regardless of which securities were deposited by the Partner or the
composition of the portfolio of the Registrant at the time of
redemption.
Obviously, the value of the shares on redemption may be more or
less than a Partner's cost, depending upon the value of the portfolio
securities at the time of redemption. A Partner redeeming his shares
will realize a gain or loss for income tax purposes, measured with
respect to the adjusted basis of his shares at the time of
redemption, when he receives cash at redemption. In the opinion of
Dickstein, Shapiro & Morin, tax counsel for the Registrant, neither
the Registrant nor a redeeming Partner will recognize gain or loss
for Federal income tax purposes upon the distribution of securities
in kind to a redeeming Partner. The basis to a redeeming Partner of
securities received by him in redemption of all of his shares will be
the same as the basis of the shares he redeemed. The basis of
securities received by a Partner in redemption of a portion of his
shares will be the basis of such securities in the hands of the
Registrant immediately before such distribution (but not in excess of
the basis of all of his shares of the Registrant, both those redeemed
and not redeemed).
Investors who have not exchanged restricted securities for
shares may, by notice in writing to State Street Bank and Trust
Company (accompanied by appropriate stock powers and certificates, if
previously issued), elect to participate in a Systematic Withdrawal
Plan (the "Plan"). Participants in the Plan will receive quarterly
payments in cash as a partial redemption of their shares up to 3/4%
of the net asset value of their shares. The Registrant does not
intend to impose a charge upon investors for participating in the
Plan. Participants may withdraw from the Plan at any time by written
notice to State Street Bank and Trust Company. Although the
Registrant believes that its operations will generate sufficient cash
to satisfy the redemption payments required by the Plan, the Plan may
require the Registrant to obtain additional cash by selling portfolio
securities or borrowing. The burden of any taxes payable as a result
of such sales will be shared by all investors in the Registrant
regardless of their participation in the Plan. Participation in the
Plan will reduce the number of shares owned by an investor and the
value of his account.
(b) Not applicable.
(c) Not applicable.
(d) Not applicable.
Item 9. Pending Legal Proceedings
None.
PART B.
Item 10. Cover Page
Not applicable.
Item 11. Table of Contents
Not applicable.
Item 12. General Information and History
Not applicable.
Item 13. Investment Objectives and Policies
(a) See response to Item 4(a).
(b) The Registrant may not:
(1) Purchase any securities on margin, but the Registrant may
obtain such credits as may be necessary for the clearance of
purchases and sales of securities;
(2) Sell any securities short;
(3) Borrow money except as a temporary measure for
extraordinary or emergency purposes and then only in amounts not
in excess of 10% of the value of its total assets. The
Registrant will not borrow for investment purposes. Investment
securities will not be purchased while any borrowings are
outstanding;
(4) Pledge securities;
(5) Purchase securities of an issuer if such purchase at the
time thereof would cause more than 5% of the value of the
Registrant's assets to be invested in the securities of any one
issuer;
(6) Purchase securities of an issuer if such purchase at the
time thereof would cause more than 10% of the voting securities
of any one issuer to be owned by the Registrant or more than 10%
of any other class of such issuer being owned by the Registrant
(for these purposes, all outstanding bonds and evidences of
indebtedness shall be deemed to be a single class of securities
of the issuer and all kinds of stock of an issuer which are
preferred over the common stock as to dividends or in
liquidation shall be deemed to constitute a single class
regardless of relative priorities, series, designations,
conversion rights or other differences);
(7) Purchase securities issued by any other open-end investment
company except pursuant to a merger, consolidation, or other
reorganization;
(8) Invest more than 5% of the assets of the Registrant in
securities of issuers which have a record of less than 3 years
of continuous operation, including the operation of any
predecessor;
(9) Purchase or retain securities of any issuer if, to the
knowledge of the Registrant, the General Partners of the
Registrant or the officers or directors of the Adviser who
individually own more than 1/2 of 1% of the securities of such
issuer together own more than 5% of the securities of such
issuer;
(10) Invest in commodities, commodity contracts, or real estate;
(11) Purchase or sell puts, calls, straddles, or spreads or any
combination thereof except that: (a) the Registrant may write
call options on securities constituting not more than 25% of the
value of its net assets if the option is listed on a national
securities exchange and at all times while the option is
outstanding the Registrant owns securities convertible into such
securities, and (b) the Registrant may purchase call options in
closing purchase transactions to liquidate its position as an
option writer;
(12) Engage in underwriting or agency distribution of securities
issued by others except insofar as it may be deemed to be an
underwriter under the Securities Act of 1933 by virtue of its
disposition of a particular block of securities;
(13) Lend any assets except portfolio securities. (This shall
not prevent the purchase or holding of bonds, debentures, notes,
certificates of indebtedness, or other debt securities of an
issuer; repurchase agreements; or other transactions which are
permitted by the Registrant's investment objective and policies
or Limited Partnership Agreement). There is the risk that when
lending portfolio securities, the securities may not be
available to the Fund on a timely basis and the Fund may,
therefore, lose the opportunity to sell the securities at a
desirable price. In addition, in the event that a borrower of
securities would file for bankruptcy or become insolvent,
disposition of the securities may be delayed pending court
action;
(14) Invest in securities of a company for the purpose of
exercising control or management. The Registrant, however, may
invest in up to 10% of the voting securities of any one issuer
and may exercise its voting powers consistent with the best
interests of the Registrant. From time to time, the Registrant,
together with other investment companies advised by Federated
Advisers (the "Adviser") or its affiliated companies, may
together buy and hold substantial amounts of the voting stock of
a company and all such stock may be voted together in regard to
such company's affairs. In some such cases, the Registrant and
the other investment companies, advised by the Adviser or its
affiliated companies holding such stock might collectively be
considered to be in control of such company. In some cases
Partners, agents, employees officers or other persons affiliated
with or acting for or on behalf of the Registrant, the Adviser
or its affiliated companies, might possibly become directors of
companies in which the Registrant holds stock;
(15) Purchase oil, gas, or other mineral leases or purchase a
partnership interest in oil, gas, or other mineral exploration
programs;
(16) Purchase warrants having a value in excess of 5% of the
Registrant's net assets or purchase warrants not listed on the
New York Stock Exchange or American Stock Exchange having a
value in excess of 2% of the Registrant's net assets; and
(17) Issue senior securities.
For purposes of its policies and limitations, the Registrant
considers certificates of deposit and demand and time deposits issued
by a U.S. branch of a domestic bank or savings and loan having
capital, surplus, and undivided profits in excess of $100,000,000 at
the time of investment to be "cash items."
(c) Not applicable.
(d) Portfolio turnover: Although the Registrant does not intend to
invest for the purpose of seeking short-term profits, securities in
its portfolio will be sold whenever the Registrant's investment
adviser believes it is appropriate to do so in light of the
Registrant's investment objective, without regard to the length of
time a particular security may have been held.
The Registrant will not attempt to set or meet a portfolio turnover
rate since any turnover would be incidental to transactions
undertaken in an attempt to achieve the Registrant's investment
objective. Portfolio turnover for the fiscal years ended December
31, 1994, and 1993, was 23% and 26%, respectively.
Item 14. Management of the Registrant
(a) Officers and Managing General Partners are listed with their
addresses, birthdates, present positions with Federated Exchange
Fund, Ltd., and principal occupations.
John F. Donahue@*
Federated Investors Tower
Pittsburgh, PA
Birthdate: 7/28/24
President and Managing General Partner
Chairman and Trustee, Federated Investors, Federated Advisers, Federated
Management, and Federated Research; Chairman and Director, Federated
Research Corp.; Chairman, Passport Research, Ltd.; Director, AEtna Life and
Casualty Company; Chief Executive Officer and Director, Trustee, or
Managing General Partner of the Funds. Mr. Donahue is the father of J.
Christopher Donahue, Vice President of the Registrant.
Thomas G. Bigley
28th Floor, One Oxford Centre
Pittsburgh, PA
Birthdate:2/3/34
Managing General Partner
Director, Oberg Manufacturing Co.; Chairman of the Board, Children's
Hospital of Pittsburgh; Director, Trustee, or Managing General Partner of
the Funds; formerly, Senior Partner, Ernst & Young LLP.
John T. Conroy, Jr.
Wood/IPC Commercial Department
John R. Wood and Associates, Inc., Realtors
3255 Tamiami Trail North
Naples, FL
Birthdate:6/23/37
Managing General Partner
President, Investment Properties Corporation; Senior Vice-President, John
R. Wood and Associates, Inc., Realtors; President, Northgate Village
Development Corporation; Partner or Trustee in private real estate ventures
in Southwest Florida; Director, Trustee, or Managing General Partner of the
Funds; formerly, President, Naples Property Management, Inc.
William J. Copeland
One PNC Plaza - 23rd Floor
Pittsburgh, PA
Birthdate:7/4/18
Managing General Partner
Director and Member of the Executive Committee, Michael Baker, Inc.;
Director, Trustee, or Managing General Partner of the Funds; formerly, Vice
Chairman and Director, PNC Bank, N.A., and PNC Bank Corp. and Director,
Ryan Homes, Inc.
James E. Dowd
571 Hayward Mill Road
Concord, MA
Birthdate:5/18/22
Managing General Partner
Attorney-at-law; Director, The Emerging Germany Fund, Inc.; Director,
Trustee, or Managing General Partner of the Funds; formerly, Director, Blue
Cross of Massachusetts, Inc.
Lawrence D. Ellis, M.D.
3471 Fifth Avenue, Suite 1111
Pittsburgh, PA
Birthdate:10/11/32
Managing General Partner
Professor of Medicine and Member, Board of Trustees, University of
Pittsburgh; Medical Director, University of Pittsburgh Medical Center -
Downtown; Member, Board of Directors, University of Pittsburgh Medical
Center; formerly, Hematologist, Oncologist, and Internist, Presbyterian and
Montefiore Hospitals; Director, Trustee, or Managing General Partner of the
Funds.
Edward L. Flaherty, Jr.@
Henny, Koehuba, Meyer and Flaherty
Two Gateway Center - Suite 674
Pittsburgh, PA
Birthdate:6/18/24
Managing General Partner
Attorney-at-law; Partner, Henny, Koehuba, Meyer and Flaherty; Director,
Eat'N Park Restaurants, Inc., and Statewide Settlement Agency, Inc.;
Director, Trustee, or Managing General Partner of the Funds; formerly,
Counsel, Horizon Financial, F.A., Western Region.
Peter E. Madden
225 Franklin Street
Boston, MA
Birthdate:4/16/42
Managing General Partner
Consultant; State Representative, Commonwealth of Massachusetts; Director,
Trustee, or Managing General Partner of the Funds; formerly, President,
State Street Bank and Trust Company and State Street Boston Corporation and
Trustee, Lahey Clinic Foundation, Inc.
Gregor F. Meyer
Henny, Koehuba, Meyer and Flaherty
Two Gateway Center - Suite 674
Pittsburgh, PA
Birthdate:10/6/26
Managing General Partner
Attorney-at-law; Partner, Henny, Koehuba, Meyer and Flaherty; Chairman,
Meritcare, Inc.; Director, Eat'N Park Restaurants, Inc.; Director, Trustee,
or Managing General Partner of the Funds; formerly, Vice Chairman, Horizon
Financial, F.A.
Wesley W. Posvar
1202 Cathedral of Learning
University of Pittsburgh
Pittsburgh, PA
Birthdate:9/14/25
Managing General Partner
Professor, Foreign Policy and Management Consultant; Trustee, Carnegie
Endowment for International Peace, RAND Corporation, Online Computer
Library Center, Inc., and U.S. Space Foundation; Chairman, Czecho Slovak
Management Center; Director, Trustee, or Managing General Partner of the
Funds; President Emeritus, University of Pittsburgh; formerly, Chairman,
National Advisory Council for Environmental Policy and Technology.
Marjorie P. Smuts
4905 Bayard Street
Pittsburgh, PA
Birthdate:6/21/35
Managing General Partner
Public relations/marketing consultant; Director, Trustee, or Managing
General Partner of the Funds.
J. Christopher Donahue
Federated Investors Tower
Pittsburgh, PA
Birthdate:4/11/49
Vice President
President and Trustee, Federated Investors, Federated Advisers, Federated
Management, and Federated Research; President and Director, Federated
Research Corp.; President, Passport Research, Ltd.; Trustee, Federated
Administrative Services, Federated Services Company, and Federated
Shareholder Services; President or Vice President of the Funds; Director,
Trustee, or Managing General Partner of some of the Funds. Mr. Donahue is
the son of John F. Donahue, President and Managing General Partner of the
Registrant.
Richard B. Fisher
Federated Investors Tower
Pittsburgh, PA
Birthdate:5/17/23
Vice President
Executive Vice President and Trustee, Federated Investors; Director,
Federated Research Corp.; Chairman and Director, Federated Securities
Corp.; President or Vice President of some of the Funds; Director or
Trustee of some of the Funds.
Edward C. Gonzales
Federated Investors Tower
Pittsburgh, PA
Birthdate:10/22/30
Vice President and Treasurer
Vice President, Treasurer, and Trustee, Federated Investors; Vice President
and Treasurer, Federated Advisers, Federated Management, Federated
Research, Federated Research Corp., and Passport Research, Ltd.; Executive
Vice President, Treasurer, and Director, Federated Securities Corp.;
Trustee, Federated Services Company and Federated Shareholder Services;
Chairman, Treasurer, and Trustee, Federated Administrative Services;
Trustee or Director of some of the Funds; Vice President and Treasurer of
the Funds.
John E. Murray, Jr., J.D.,S.J.D.
President
Duquesne University
Pittsburgh, PA 15282
Birthdate:12/20/32
Managing General Partner
President, Law Professor, Duquesne University; Consulting Partner, Mollica,
Murray and Hogue; Director, Trustee or Managing General Partner of the
Funds.
John W. McGonigle
Federated Investors Tower
Pittsburgh, PA
Birthdate:10/26/38
Vice President and Secretary
Investors
Investors; Vice President, Secretary, and Trustee, Federated Advisers,
Federated Management, and Federated Research; Vice President and Secretary,
Federated Research Corp. and Passport Research, Ltd.; Trustee, Federated
Services Company; Executive Vice President, Secretary, and Trustee,
Federated Administrative Services; Secretary and Trustee, Federated
Shareholder Services; Executive Vice President and Director, Federated
Securities Corp.; Vice President and Secretary of the Funds.
* This Managing General Partner is deemed to be an "interested
person" as defined in the Investment Company Act of 1940, as
amended.
@ Member of the Registrant;'s Executive Committee. The Executive
Committee of the Board of Managing General Partners handles the
responsibilities of the Board of Managing General Partners between
meetings of the Board.
Managing General Partner Compensation
AGGREGATE
NAME , COMPENSATION
POSITION WITH FROM TOTAL COMPENSATION PAID
Partnership Registrant*# FROM FUND COMPLEX +
Thomas G. Bigley $1,250.00 $20,688 for the Fund and
50 other investment companies in the Fund
Complex
John T. Conroy, Jr. $5,200.00 $117,202 for the Fund and
65 other investment companies in the Fund
Complex
William J. Copeland $5,200.00 $117,202 for the Fund and
65 other investment companies in the Fund
Complex
James E. Dowd $5,200.00 $117,202 for the Fund and
65 other investment companies in the Fund
Complex
Lawrence D. Ellis, M.D. $5,000.00 $106,460 for the Fund and
65 other investment companies in the Fund
Complex
Edward L. Flaherty, Jr. $5,200.00 $117,202 for the Fund and
65 other investment companies in the Fund
Complex
Peter E. Madden $4,258.00 $90,563 for the Fund and
65 other investment companies in the Fund
Complex
Gregor F. Meyer $5,000.00 $106,460 for the Fund and
65 other investment companies in the Fund
Complex
Wesley W. Posvar $5,000.00 $106,460 for the Fund and 65 other
investment companies in the Fund Complex
Marjorie P. Smuts $5,000.00 $106,460 for the Fund and
65 other investment companies in the Fund
Complex
*Information is furnished for the fiscal year ended December 31, 1994.
+ The information is provided for the last calendar year.
# The aggregate compensation is provided for the Trust which is comprised of
one portfolio.
As used in the table above, "The Funds" and "Funds" mean the
following investment companies: American Leaders Fund, Inc.; Annuity
Management Series; Arrow Funds; Automated Cash Management Trust; Automated
Government Money Trust; California Municipal Cash Trust; Cash Trust Series
II; Cash Trust Series, Inc.; DG Investor Series; Edward D. Jones & Co.
Daily Passport Cash Trust; Federated ARMs Fund; Federated Exchange Fund,
Ltd.; Federated GNMA Trust; Federated Government Trust; Federated Growth
Trust; Federated High Yield Trust; Federated Income Securities Trust;
Federated Income Trust; Federated Index Trust; Federated Institutional
Trust; Federated Intermediate Government Trust; Federated Master Trust;
Federated Municipal Trust; Federated Short-Intermediate Government Trust;
Federated Short-Term U.S. Government Trust; Federated Stock Trust;
Federated Tax-Free Trust; Federated U.S. Government Bond Fund; First
Priority Funds; Fixed Income Securities, Inc.; Fortress Adjustable Rate
U.S. Government Fund, Inc.; Fortress Municipal Income Fund, Inc.; Fortress
Utility Fund, Inc.; Fund for U.S. Government Securities, Inc.; Government
Income Securities, Inc.; High Yield Cash Trust; Insight Institutional
Series, Inc.; Insurance Management Series; Intermediate Municipal Trust;
International Series, Inc.; Investment Series Funds, Inc.; Investment
Series Trust; Liberty Equity Income Fund, Inc.; Liberty High Income Bond
Fund, Inc.; Liberty Municipal Securities Fund, Inc.; Liberty U.S.
Government Money Market Trust; Liberty Term Trust, Inc. - 1999; Liberty
Utility Fund, Inc.; Liquid Cash Trust; Managed Series Trust; Money Market
Management, Inc.; Money Market Obligations Trust; Money Market Trust;
Municipal Securities Income Trust; Newpoint Funds; New York Municipal Cash
Trust; 111 Corcoran Funds; Peachtree Funds; The Planters Funds; RIMCO
Monument Funds; The Shawmut Funds; Short-Term Municipal Trust; Star Funds;
The Starburst Funds; The Starburst Funds II; Stock and Bond Fund, Inc.;
Sunburst Funds; Targeted Duration Trust; Tax-Free Instruments Trust;
Trademark Funds; Trust for Financial Institutions; Trust For Government
Cash Reserves; Trust for Short-Term U.S. Government Securities; Trust for
U.S. Treasury Obligations; The Virtus Funds; and World Investment Series,
Inc.
(b) See response to (a).
(c) Not applicable.
Item 15. Control Persons and Principal Holders of Securities
(a) None.
(b) As of April 7, 1995 the following partner of record owned 5% or
more of the outstanding Shares of the Registrant:
Paulette M. Boiardi, New York, New York, owned approximately 91,356
Shares (7.89%).
(c) Officers and Managing General Partners own less than 1% of the
Registrant's outstanding shares.
Item 16. Investment Advisory and Other Services
(a) The Registrant's investment adviser is Federated Advisers. It is
a subsidiary of Federated Investors. All of the voting securities of
Federated Investors are owned by a trust, the trustees of which are
John F. Donahue, his wife, and his son, J. Christopher Donahue.
The Adviser shall not be liable to the Registrant or any partner
for any losses that may be sustained in the purchase, holding, or
sale of any security, or for anything done or omitted by it, except
acts or omissions involving willful misfeasance, bad faith, gross
negligence, or reckless disregard of the duties imposed upon it by
its contract with the Registrant.
For its advisory services, Federated Advisers receives an annual
investment advisory fee as described in Part A. During the fiscal
years ended December 31, 1994, 1993, and 1992, the Adviser earned
$585,292, $610,479, and $626,071, respectively.
The Adviser has undertaken to comply with the expense limitations
established by certain states for investment companies whose shares
are registered for sale in those states. If the Registrant's normal
operating expenses (including the investment advisory fee, but not
including brokerage commissions, interest, taxes, and extraordinary
expenses) exceed 2 1/2% per year of the first $30 million of average
net assets, 2% per year of the next $70 million of average net
assets, and 1 1/2% per year of the remaining average net assets, the
Adviser will reimburse the Registrant for its expenses over the
limitation.
If the Registrant's monthly projected operating expenses exceed
this limitation, the investment advisory fee paid will be reduced by
the amount of the excess, subject to an annual adjustment. If the
expense limitation is exceeded, the amount to be reimbursed by the
Adviser will be limited, in any single fiscal year, by the amount of
the investment advisory fee. This arrangement is not part of the
advisory contract and may be amended or rescinded in the future.
(b) Not applicable.
(c) Not applicable.
(d) Federated Administrative Services, a subsidiary of Federated
Investors, provides administrative and personnel services to the
Registrant for a fee as described in Part A. Prior to March 1, 1994,
Federated Administrative Services, Inc., also a subsidiary of
Federated Investors, served as the Fund's administrator. (For
purposes of Part B, Federated Administrative Services and Federated
Administrative Services, Inc., may hereinafter collectively be
referred to as, the "Administrators".) For the fiscal year ended
December 31, 1994, the Administrators collectively earned $145,620,
none of which was waived. For the fiscal years ended December 31,
1993, and 1992, Federated Administrative Services, Inc., earned
$230,851, and $186,504, respectively, none of which was waived. Dr.
Henry J. Gailliot, an officer of Federated Advisers, the adviser to
the Registrant, holds approximately 20% of the outstanding common
stock and serves as a director of Commercial Data Services, Inc., a
company which provides computer processing services to Federated
Administrative Services.
Pursuant to a Shareholder Services Plan, the Registrant is permitted
to pay fees to Federated Shareholder Services and, indirectly, to
financial institutions to cause services to be provided to
shareholders by a representative who has knowledge of the
shareholder's particular circumstances and goals. These activities
and services may include, but are not limited to, providing office
space, equipment, telephone facilities, and various clerical,
supervisory, computer, and other personnel as necessary or beneficial
to establish and maintain shareholder accounts and records;
processing purchase and redemption transactions and automatic
investments of client account cash balances; answering routine client
inquiries; and assisting clients in changing dividend options,
account designations, and addresses. For the fiscal period ending
December 31, 1994, no payments were made pursuant to the Shareholder
Services Plan.
(e) Not applicable.
(f) Not applicable.
(g) See Item 17(a).
(h) State Street Bank and Trust Company, Boston, Massachusetts, is
custodian for the securities and cash of the Registrant. It also
provides certain accounting and recordkeeping services with respect
to the Registrant's portfolio of investments.
The independent auditors for the Registrant are Deloitte &
Touche, LLP, 125 Summer Street, Boston, Massachusetts.
(i) Federated Services Company, Pittsburgh, Pennsylvania, serves as
transfer agent and dividend disbursing agent for the Registrant. The
fee paid to the transfer agent is based upon the size, type and
number of accounts and transactions made by shareholders. Federated
Services Company also maintains the Registrant's accounting records.
The fee paid for this service is based upon the level of the
Registrant's average net assets for the period plus out-of-pocket
expenses.
Item 17. Brokerage Allocation and Other Practices
(a) When selecting brokers and dealers to handle the purchase and
sale of portfolio instruments, the Adviser looks for prompt execution
of the order at a favorable price. In working with dealers, the
Adviser will generally utilize those who are recognized dealers in
specific portfolio instruments, except when a better price and
execution of the order can be obtained elsewhere. In selecting among
firms believed to meet these criteria, the Adviser may give
consideration to those firms which have sold or are selling shares of
the Registrant and other Funds. The Adviser makes decisions on
portfolio transactions and selects brokers and dealers subject to
review by the Board of Managing General Partners.
The Adviser may select brokers and dealers who offer brokerage
and research services. These services may be furnished directly to
the Registrant or to the Adviser and may include:
* advice as to the advisability of investing in securities;
* security analysis and reports;
* economic studies;
* industry studies;
* receipt of quotations for portfolio evaluations; and
* similar services.
The Adviser and its affiliates exercise reasonable business
judgment in selecting brokers who offer brokerage and research
services to execute securities transactions. They determine in good
faith that commissions charged by such persons are reasonable in
relationship to the value of the brokerage and research services
provided.
Research services provided by brokers and dealers may be used by
the Adviser or by affiliates of Federated Investors in advising the
Funds and other accounts. To the extent that receipt of these
services may supplant services for which the Adviser or its
affiliates might otherwise have paid, it would tend to reduce their
expenses.
For the fiscal years ended December 31, 1994, 1993, and 1992, the
Registrant paid brokerage commissions of $45,450, $48,022, and
$90,699, respectively, on brokerage transactions.
(b) None.
(c) See response to (a).
(d) Not applicable.
(e) For the period ended December 31, 1994, the Registrant held
securities of the following of the Registrant's regular brokers or
dealers or the parents of such brokers or dealers that derive more
than 15% of gross revenue from securities related activities:
Dean Witter, Discover & Co., equity securities valued at $784,037 at
December 31, 1994.
Item 18. Capital Stock and Other Securities
(a) See response to Item 6.
(b) Not applicable.
Item 19. Purchase, Redemption, and Pricing of Securities Being Offered
(a) A Partner who redeems any portion of his shares during the first
five years of his participation in the Registrant will be paid either
in portfolio securities, cash, or a combination thereof as may be
determined at the complete discretion of the Managing General
Partners. To the extent the payment is made in securities, he will
receive securities of the same class of the same issuer as deposited
by him to the extent then available in the Registrant's portfolio.
If such securities are not so available, that part of the payment
represented by securities will be made in other portfolio securities.
Securities delivered in redemption in kind will be valued at the
amount at which they were valued in computing the redemption value of
shares redeemed. In the event a redeeming Partner receives
securities and sells such securities, he will, of course, incur
normal brokerage commissions upon such sale.
No portfolio security which is subject to restrictions on sale by
the Registrant by reason of any agreement of the depositor of such
securities, by reason of the provisions of the Securities Act of 1933
and the rules and regulations thereunder, or otherwise, will be
delivered in redemption in kind except to a redeeming Partner who had
previously deposited that particular security. Redeeming Partners
receiving securities which are restricted by reason of the provisions
of the Securities Act of 1933 and the rules and regulations
thereunder will be subject to legal or contractual delays on resale
or restrictions on resale. In general, restricted securities can be
sold in limited quantities in the public market after having been
beneficially held for at least two years after such securities are
received in redemption.
The Registrant may suspend the right of redemption or delay
payment more than seven days during any period when trading on the
New York Stock Exchange is restricted, when the New York Stock
Exchange is closed (other than customary weekend and holiday
closings), when an emergency exists as defined by rules and
regulations or the Securities and Exchange Commission, or when the
Securities and Exchange Commission has, by order, permitted such
suspension.
Please see Item 8(a).
(b) Effective January 1, 1980, the net asset value is determined by
or on behalf of the Managing General Partners. The net asset value
per share of the Registrant is determined at the close of business of
the New York Stock Exchange, on each business day when the New York
Stock Exchange is open, by adding the market value of all securities
and all other assets, subtracting liabilities and dividing by the
number of shares outstanding. Portfolio securities (for options
refer to the option accounting principles below) listed on the New
York Stock Exchange or any other national securities exchange which
closes at the same time as the New York Stock Exchange are valued at
the last sale price as furnished by an independent pricing service.
Unlisted portfolio securities and listed portfolio securities which
were not traded on that day are valued at the mean between bid and
asked prices. Short-term obligations are ordinarily valued at the
mean between bid and asked prices as furnished by an independent
pricing service. However, short-term obligations with remaining
maturities of 60 days or less, at the time of purchase, are valued at
amortized cost. All other securities (including restricted
securities) are valued at fair value as determined in good faith by
the Managing General Partners.
When the Registrant writes a call option, an amount equal to the
premium received by the Registrant is included in the Registrant's
Statement of Assets and Liabilities as an asset and a corresponding
liability. The amount of the liability will be subsequently marked-
to-market to reflect the current market value of the option written.
The current market value of a traded option is the last sale price on
the exchange where it is primarily traded, or, in the absence of a
last sale price, at the mean between the last bid and asked price, or
in the absence of these prices, fair value using consistently applied
methods determined in good faith by the Managing General Partners.
If an option expires on its stipulated expiration date or if the
Registrant enters into a closing purchase transaction, the Registrant
will realize a gain (or loss if the cost of a closing purchase
transaction exceeds the premium received when the option was sold)
without regard to any unrealized gain or loss on the underlying
security, and the liability related to such option will be
extinguished. If an option is exercised, the Registrant will realize
a gain or loss from the sale of the underlying security and the
proceeds of the sale are increased by the premium originally
received.
(c) The Registrant reserves the right, in its complete discretion, to
redeem its shares wholly or partly in portfolio securities
("redemption in kind") instead of in cash, and to deliver one or more
portfolio securities in satisfaction of the redemption request
regardless of which securities were deposited by the Partner or the
composition of the portfolio of the Fund at the time of redemption.
Item 20. Tax Status
Registrant is a partnership for Federal income tax purposes. As
a partnership, the Registrant is not an entity subject to Federal
income tax. Partnership income, gains, losses, deductions and
credits will be allocated equally among the outstanding shares. A
holder of a share shall be allocated the proportionate part of such
items accrued on the books by the Partnership during the specific
days of the taxable year on which such share was owned by such
holder.
Without regard to whether they have received or will receive any
distributions from the Registrant, Partners must take into account in
computing their respective Federal income tax liabilities their
distributive share of Registrant income, gains, losses, deductions
and credits for any taxable year of the Registrant ending with or
during their respective taxable years as provided by the Partnership
Agreement.
Item 21. Underwriters
Not applicable.
Item 22. Calculation of Performance Data
Not applicable.
Item 23. Financial Statements
The financial statements for the fiscal year ended December 31, 1994
are incorporated herein by reference from the Registrant's Annual Report
dated December 31, 1994,(File No. 811-2626). A copy of the Annual Report
may be obtained without charge by contacting the Registrant.
PART C. OTHER INFORMATION.
Item 24. Financial Statements of Exhibits:
(a) Financial Statements (7);
(b) Exhibits:
(1) Paper copy of Restated Certificate and Agreement of Limited
Partnership of the Registrant (2);
(2) Copy of By-Laws of the Registrant;+
(i) Copy of Amendment No. 1 to the By-Laws of the
Registrant;+
(ii) Conformed Copy of Amendment No. 2 to the By-Laws of
the Registrant (6);
(3) Not applicable;
(4) Copy of Specimen Certificate for Units of Limited
Partnership of the Registrant (5);
(5) Conformed Copy of Investment Advisory Contract of the
Registrant (6);
(6) Not applicable;
(7) Not applicable;
(8) (i) Conformed copy of the Custodian Agreement
of the Registrant;+
(9) (i) Conformed copy of Shareholder Services Plan of
the Registrant;+
(ii) Copy of Shareholder Services Sub-Contract of the
Registrant;+
(iii) Conformed copy of Shareholder Services
Agreement of the Registrant;+
(iv) Conformed copy of Administrative Services
Agreement of the Registrant;+
(v) Conformed copy of Agreement for Fund Accounting,
Shareholder Recordkeeping, and Custody Services
Procurement;+
(10) Not applicable;
(11) Not applicable;
(12) Not applicable;
(13) Not applicable;
(14) Not applicable;
(15) Not applicable;
(16) Not applicable;
(17) Financial Data Schedule;+
(18) Not applicable.
(19) Conformed copy of Power of Attorney;+
+ All exhibits filed electronically.
2. Response is incorporated by reference to Registrant's Prospectus filed
pursuant to Rule 424(b) on September 8, 1976. (File No. 811-2626.)
5. Response is incorporated by reference to Registrant's Amendment No. 2 to its
Registration Statement filed on Form S-5 filed on August 24, 1976. (File
No. 811-2626.)
6. Response is incorporated by reference to Registrant's Amendment No. 10 to
its Registration Statement filed on Form N-1A on April 27, 1990.
7. Response is incorporated by reference to Registrant's Annual Report filed
pursuant to Rule 30(b) (2) of the Investment Company Act of 1940, and Rule
30b2-1 thereunder on February 24, 1995. (File No. 811-2626)
Item 25. Persons Controlled by or Under Common Control with Registrant:
None.
Item 26. Number of Holders of Securities:
Number of Record Holders
Title of Class as of April 7, 1995
Units of Limited Partnership 452
(no par value)
Item 27. Indemnification: (9)
Item 28. Business and Other Connections of Investment Adviser:
(a) For a description of the other business of the investment
adviser, see Item 5 in Part A. The affiliations with the Registrant
of four of the Trustees and one of the Officers of the investment
adviser are included in Part B of this Registration Statement under
Item 14. The remaining Trustee of the investment adviser, and his
principal occupation is: Mark D. Olson, Partner, Wilson, Holbrook &
Bayard, 107 West Market Street, Georgetown, Delaware, 19947.
The remaining Officers of the investment adviser are: William D.
Dawson, III, J. Thomas Madden, Mark L. Mallon, Executive Vice
Presidents; Henry J. Gailliot, Senior Vice President-Economist; Peter
R. Anderson, Gary J. Madich, J. Alan Minteer, Senior Vice Presidents;
J. Scott Albrecht, Randall A. Bauer, Jonathan C. Conley, Deborah A.
Cunningham, Michael P. Donnelly, Mark E. Durbiano, Kathleen M. Foody-
Malus, Thomas M. Franks, Edward C. Gonzales, Jeff A. Kozemchak,
Marian R. Marinack, John W. McGonigle, Gregory M. Melvin, Susan M.
Nason, Mary Jo Ochson, Robert J. Ostrowski, Frederick L. Plautz, Jr.,
Charles A. Ritter, James D. Roberge, and Christopher H. Wiles, Vice
Presidents, Edward C. Gonzales, Treasurer, and John W. McGonigle,
Secretary. The business address of each of the Officers of the
investment adviser is Federated Investors Tower, Pittsburgh,
Pennsylvania 15222-3779. These individuals are also officers of a
majority of the investment advisers to the Funds listed in Item 14(a)
of this Registration Statement.
Item 29. Principal Underwriters:
Not applicable.
9. Response is incorporated by reference to Registrant's Amendment No. 13 to
its Registration Statement filed on Form N-1A on February 26, 1993.
Item 30. Location of Accounts and Records:
All accounts and records required to be maintained by Section 31(a)
of the Investment Company Act of 1940 and Rules 31a-1 through 31a-3
promulgated thereunder are maintained at one of the following
locations:
Registrant Federated Investors Tower
Pittsburgh, PA 15222-3779
Federated Services Company Federated Investors Tower
("Transfer Agent and Dividend Pittsburgh, PA 15222-3779
Disbursing Agent")
Federated Administrative Federated Investors Tower
Services Pittsburgh, PA 15222-3779
("Administrator")
Federated Advisers Federated Investors Tower
("Adviser") Pittsburgh, PA 15222-3779
State Street Bank and Trust P.O. Box 1119
Company Boston, MA
("Custodian")
Item 31. Management Services:
Not applicable.
Item 32. Undertakings:
Registrant hereby undertakes, if requested to do so by the holders of
at least 10% of the registrant's outstanding shares, to call a
meeting of Partners for the purpose of voting upon the question of
removal of a General Partner or General Partners and to assist in
communications with other Partners as required by Section 16(c).
Registrant hereby undertakes to furnish each person to whom a
prospectus is delivered with a copy of the Registrant's latest annual
report to shareholders, upon request and without charge.
SIGNATURES
Pursuant to the requirements of the Investment Company Act of
1940, the Registrant, FEDERATED EXCHANGE FUND, LTD., has duly caused this
Amendment to its Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, all in the City of Pittsburgh and
Commonwealth of Pennsylvania, on the 28th day of April, 1995.
FEDERATED EXCHANGE FUND, LTD.
By: /s/Robert C. Rosselot
Robert C. Rosselot, Assistant Secretary
Attorney in Fact of John F. Donahue
April 28, 1995
Exhibit 19 under Form N-1A
Exhibit 24 under Item 601/Reg. S-K
POWER OF ATTORNEY
Each person whose signature appears below hereby constitutes and
appoints the Secretary and Assistant Secretary of FEDERATED EXCHANGE FUND,
LTD., and the Assistant General Counsel of Federated Investors, and each
of them, their true and lawful attorneys-in-fact and agents, with full
power of substitution and resubstitution for them and in their names, place
and stead, in any and all capacities, to sign any and all documents to be
filed with the Securities and Exchange Commission pursuant to the
Securities Act of 1933, the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, by means of the Securities and Exchange
Commission's electronic disclosure system known as EDGAR; and to file the
same, with all exhibits thereto and other documents in connection
thterewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, and each of them, full power and authority to
sign and perform each and every act and thing requisite and necessary to be
done in connection thereiwth, as fully to all intents and purposes as each
of them might or could do in person, hereby ratifying and confirming all
that said attorneys-in-fact and agents, or any of them, or their or his
substitute or substitutes, may lawfully do or cause to be done by virtue
thereof.
SIGNATURES TITLE DATE
/s/ John F. Donahue President and Managing February 22, 1995
John F. Donahue General Partner
/s/ Edward C. Gonzales Vice President & Treasurer February 22, 1995
Edward C. Gonzales
/s/ Thomas G. Bigley Managing General Partner February 22, 1995
Thomas G. Bigley
/s/ John T. Conroy, Jr. Managing General Partner February 22, 1995
John T. Conroy, Jr.
/s/ William J. Copeland Managing General Partner February 22, 1995
William J. Copeland
/s/ James E. Dowd Managing General Partner February 22, 1995
James E. Dowd
/s/ Lawrence D. Ellis, M.D. Managing General
Partner February 22, 1995
Lawrence D. Ellis, M.D.
/s/ Edward L. Flaherty, Jr. Managing General
Partner February 22, 1995
Edward L. Flaherty, Jr.
/s/ Peter E. Madden Managing General Partner February 22, 1995
Peter E. Madden
/s/ John E. Murray, Jr. Managing General Partner February 22, 1995
John E. Murray, Jr.
/s/ Gregor F. Meyer Managing General Partner February 22, 1995
Gregor F. Meyer
/s/ Wesley W. Posvar Managing General Partner February 22, 1995
Wesley W. Posvar
/s/ Marjorie P. Smuts Managing General Partner February 22, 1995
Marjorie P. Smuts
Sworn to and subscribed before me this 22th day of February, 1995.
/s/ Marie M. Hamm
Notary Public
Exhibit 2 under Form N-1A
Exhibit 3(b) under Item 601/Reg. S-K
BY-LAWS OF
FEDERATED EXCHANGE FUND, LTD.
ARTICLE I
EXECUTIVE AND OTHER COMMITTEES
Section 1. APPOINTMENT AND TERM OF OFFICE OF EXECUTIVE COMMITTEE.
The Managing General Partners, by resolution passed by a vote of at least a
majority of the Managing General Partners, may appoint an Executive
Committee, which shall consist of two (2) or more Managing General Partners
which number shall include the President who shall, ex officio, be a member
thereof to serve at the pleasure of the Managing General Partners.
Section 2. VACANCIES IN EXECUTIVE COMMITTEE. Vacancies occurring
in the Executive Committee from any cause shall be filled by the Managing
General Partners at any Meeting thereof by a vote of the majority of the
Managing General Partners or by unanimous written consent of the Managing
General Partners.
Section 3. EXECUTIVE COMMITTEE TO REPORT TO MANAGING GENERAL
PARTNERS. All action by the Executive Committee shall be reported to the
Managing General Partners at its Meeting next succeeding such action.
Section 4. PROCEDURE OF EXECUTIVE COMMITTEE. The Executive
Committee shall fix its own rules of procedure not inconsistent with the
Partnership Agreement, as amended, these By-Laws or with any directions of
the Managing General Partners. It shall meet at such times and places and
upon such notice as shall be provided by such rules or by resolution of the
Managing General Partners. The presence of a majority shall constitute a
quorum for the transaction of business, and in every case an affirmative
vote of a majority of all the members of the Committee present shall be
necessary for the taking of any action.
Section 5. POWERS OF EXECUTIVE COMMITTEE. During the intervals
between the Meetings of the Managing General Partners, the Executive
Committee, except as limited by the Partnership Agreement, as amended,
these By-Laws or by specific directions of the Managing General Partners,
shall possess and may exercise all the powers of the Managing General
Partners in the management and directions of the business and conduct of
the affairs of the Partnership in such manner as the Executive Committee
shall deem for the best interests of the Partnership, and shall have power
to authorize the Seal of the Partnership to be affixed to all instruments
and documents requiring same. Notwithstanding the foregoing, the Executive
Committee shall not have the power to increase or decrease the number of
Managing General Partners, elect or remove any Agent or Officer, declare
dividends, issue units of Partnership Interest or recommend to Partners any
action requiting Partners' approval.
Section 6. OTHER COMMITTEES. From time to time the Managing General
Partners may appoint any other Committee or Committees for any purpose or
purposes to the extent lawful, which shall have such powers as shall be
specified in the resolution or appointment.
Section 7. COMPENSATION. The members of any duly appointed
Committee shall receive such compensation and/or fees as from time to time
may be fixed by the Managing General Partners.
Section 8. INFORMAL ACTION BY EXECUTIVE COMMITTEE OF OTHER
COMMITTEES. Any action require or permitted to be taken at may meeting of
the Executive Committee or any other duly appointed Committee may be taken
without a meeting if written consent to such action is signed by all
Members of such Committee and such written consent is filed with the
minutes of the proceedings of such Committee.
Section 9. ADVISORY BOARD. The Managing General Partners may
appoint an Advisory Board to consist in the first instance of not less than
three (3) members. Members of such Advisory Board shall not be General
Partners or Officers and need not be Partners. Members of this Board shall
hold office for such period as the Managing General Partners may be
resolution provide. Any Member of such Board may resign therefrom by
written instrument signed by him which shall take effect upon delivery to
the Managing General Partners. The Advisory Board shall have no legal
powers and shall not perform functions of Managing General Partners in any
manner, said Board being intended to act merely in an advisory capacity.
Such Advisory Board shall meet as such times and upon such notice as the
Managing General Partners may be resolution provide. The compensation of
the Members of the Advisory Board, if any, shall be as determined by the
Managing General Partners.
ARTICLE II
OFFICERS
Section 1. GENERAL PROVISIONS. The Officers of the Partnership
shall be a President, one or more Vice Presidents, a Treasurer and a
Secretary. The Managing General Partners may elect a Chairman of the
Managing General Partners and elect or appoint such other officers or
agents as the business of the Partnership may require including one or more
Assistant Vice Presidents, one or more Assistant Secretaries and one or
more Assistant Treasurers. The same person may hold any two offices except
those of President and Vice President.
Section 2. ELECTION, TERM OF OFFICE AND QUALIFICATIONS. The
Officers shall be elected annually by the Managing General Partners. Each
Officer shall hold office until the Annual Meeting in the next year and
until the election and qualification of his successor. Any vacancy in any
of the offices may be filled for the unexpired portion of the term by the
Managing General Partners at any Regular or Special Meeting of the Managing
General Partners. The Chairman of Managing General Partners and the
President shall be chosen from among the Managing General Partners. The
Managing General Partners may elect or appoint additional Officers or
agents at any Regular or Special Meeting of the Managing General Partners.
Section 3. REMOVAL. Any Officer elected by the Managing General
Partners may be removed with or without cause at any time upon a vote of
the majority of the Managing General Partners. Any other employee of the
Partnership may be removed or dismissed at any time by the President.
Section 4. RESIGNATIONS. Any Officer may resign at any time by
giving written notice to the Managing General Partners. Any such
resignation shall take effect at the date of receipt of each notice or at
any later time specified therein, and unless otherwise specified therein,
the acceptance of such resignation shall not be necessary to make it
effective.
Section 5. VACANCIES. A vacancy in any Office because of death,
resignation, removal, disqualification or any other cause shall be filled
for the unexpired portion of the term in the manner prescribed in these By-
Laws for regular election or appointment to such Office.
Section 6. CHAIRMAN OF THE MANAGING GENERAL PARTNERS. The Chairman
of the Managing General Partners, if there be a Chairman, shall preside at
the meetings of Partners and of the Managing General Partners. He shall
receive such information and reports as he may request from the Officers of
the Partnership. He shall counsel and advise the President on matters of
major importance.
Section 7. PRESIDENT. The President shall be the chief executive
officer of the Partnership. He shall, unless other provisions are made
therefor by the Managing General Partners or Executive Committee, employ
and define the duties of all employees or agents of the Partnership, shall
have the power to discharge any such employees, shall exercise general
supervision over the affairs of the Partnership and shall perform such
other duties as may be assigned to him from time to time by the Managing
General Partners. In the absence of the Chairman, the President shall
preside at the meetings of Partners and of the Managing General Partners.
Section 8. VICE PRESIDENT. The Vice President (or if more than one,
the senior Vice President) in the absence of the President shall perform
all duties and may exercise and of the powers of the President subject to
the control of the Managing General Partners. Each Vice President shall
perform such other duties as may be assigned to him from time to time by
the Managing General Partners or the Executive Committee.
Section 9. SECRETARY. The Secretary shall keep or cause to be kept
in books provided for the purpose the Minutes of the Meetings of the
Partners, and of the Managing General Partners; shall see that all Notices
are duly given in accordance with the provisions of these By-laws and as
required by Law; shall be custodian of the records and of the Seal of the
Partnership and see that the Seal is affixed to all documents, the
execution of which on behalf of the Partnership under its Seal is duly
authorized; shall keep directly or through a transfer agent a register of
the post office address of each Partner, and make all proper changes in
such register, retaining and filing his authority for such entries; shall
see that the Partnership Agreement, books, reports, statements,
certificates and all other documents and records required by law are
properly kept and filed; and in general shall perform all duties incident
to the Office of Secretary and such other duties as may, from time to time,
be assigned to him by the Managing General Partners or by the Executive
Committee.
Section 10. TREASURER. The Treasurer shall have supervision of the
custody of the funds and securities of the Partnership subject to the
Partnership Agreement and applicable law. Whenever required by the
Managing General Partners, the Treasurer shall make and render a statement
of the accounts of the partnership and such other statements as may be
required. He shall cause to be kept in books of the Partnership a full and
accurate account of all monies received and paid out for the account of the
Partnership. He shall perform such other duties as may be from time to
time assigned to him by the Managing General Partners or by the Executive
Committee.
Section 11. ASSISTANT VICE PRESIDENT. The Assistant President or
Vice Presidents of the Partnership shall have such authority and perform
such duties as may be assigned to them by the Managing General Partners,
the Executive Committee, or the President of the Partnership.
Section 12. ASSISTANT SECRETARIES AND ASSISTANT TREASURERS. The
Assistant Secretary or Secretaries and the Assistant Treasurer or
Treasurers shall perform the duties of the Secretary and of the Treasurer
respectively, in the absence of those Officers and shall have such further
powers and perform such other duties as may be assigned to them
respectively by the Managing General Partners or the Executive Committee or
by the President.
Section 13. SALARIES. The salaries of the Office shall be fixed from
time to time by the Managing General Partners. No officer shall be
prevented from receiving such salary by reason of the fact that he is also
a Managing General Partner of the Partnership.
ARTICLE III
SHARES AND THEIR TRANSFER
Section 1. CERTIFICATES. Certificates may be issued for units of
Partnership interest ("Shares"). All certificates shall be signed by a
Managing General Partner or the President and sealed with the seal of the
Partnership. The signatures may be either manual or facsimile signature
and the seal may be wither facsimile or any other form of Seal.
Certificates for Shares for which the Partnership has appointed an
independent Transfer Agent and Registrar shall not be valid unless
countersigned by such Transfer Agent and registered by such Registrar. In
case any Managing General Partner or Officer who has signed any certificate
ceases to be a Managing General Partner or an Officer of the Partnership
before the certificate is issued, the certificate may nevertheless be
issued by the Partnership with the same effect as if the Managing General
Partner or Officer had not ceased to be such as of the date of its
issuance. Shares certificates shall be in such form not inconsistent with
law or the Partnership Agreement or these By-Laws as may be determined by
the Managing General Partners.
Section 2. LOST, DESTROYED OR MUTILATED CERTIFICATES. In case any
certificate is lost, mutilated or destroyed, the Managing General Partners
may issue a new certificate in place thereof upon indemnity to the
Partnership against loss and upon such other terms and conditions as the
Managing General Partner may deem advisable.
Section. 3. TRANSFER AGENT AND REGISTRAR: REGULATIONS. The Managing
General Partners shall have power and authority to make all such rules and
regulations as they may deem expedient concerning the issuance, transfer
and registrations of certificates of Shares and may appoint a Transfer
Agent and/or Registrar of certificates of Shares, and may require all such
Share certificates to bear the signature of such Transfer Agent and/or of
such Registrar.
ARTICLE IV
AGREEMENTS, CHECKS, DRAFTS, ENDORSEMENTS, ETC.
Section 1. AGREEMENTS, ECT. The Managing General Partners or the
Executive Committee may authorize any Officer or Officers, or Agent or
Agents of the Partnership to enter into any Agreement or execute and
deliver any instrument in the name of and on behalf of the Partnership, and
such authority may be general or confined to specific instances; and,
unless so authorized by the Managing General Partners or by the Executive
Committee or by these By-Laws, no Officer, Agent or Employee shall have any
power or authority to bind the Partnership by any Agreement or engagement
or to pledge its credit or to render it liable pencuniarily for any purpose
or to any amount.
Section 2. CHECKS, DRAFTS, ECT. All checks, drafts, or orders for
the payment of money, notes and other evidences of indebtedness shall be
signed by such Officer or Officers, Employee or Employees, or Agent or
Agents as shall be from time to time designated by the Managing General
Partners or the Executive Committee, or as may be specified in or pursuant
to the agreement between the Partnership and the Bank or Trust Company
appointed as custodian, pursuant to the provisions of the Partnership
Agreement.
Section 3. ENDORSEMENTS, ASSIGNMENTS AND TRANSFER OF SECURITIES.
All endorsements, assignments, stock powers or other instruments of
transfer of securities standing in the name of the Partnership or its
nominee directions for the transfer of securities belonging to the
Partnership shall be made by such Officer or Officers, Employee or
Employees, or Agent or Agents as may be authorized by the Managing General
Partners or the Executive Committee.
Section 4. EVIDENCE OF AUTHORITY. Anyone dealing with the
Partnership shall be fully justified in relying on a copy of a resolution
of the Managing General Partners or of any Committee thereof empowered to
act in the premises which is certified as true by the Secretary or an
Assistant Secretary under the seal of the Partnership.
Section 5. DESIGNATION OF A CUSTODIAN. The Partnership shall place
and at all times maintain in the custody of a Custodian all funds,
securities and similar investments owned by the Partnership, with the
exception of securities loaned under a properly authorized Securities Loan
Agreement. The Custodian shall be a bank having not less than $2,000,000
aggregate capital, surplus and undivided profits and shall be appointed
from time to time by the Managing General Partners, which shall fix its
remuneration.
Section 6. ACTION UPON TERMINATION OF A CUSTODIAN AGREEMENT. Upon
termination of a Custodian Agreement or inability of the Custodian to
continue to serve, the Managing General Partners shall promptly appoint a
successor custodian, but in the event that no successor custodian can be
found who has the required qualifications and is willing to serve, the
Managing General Partners shall call as promptly as possible a special
meeting of the Partners to determine whether the Partnership shall function
without a custodian or shall be dissolved.
ARTICLE V
MISCELLANEOUS
Section 1. SEAL. The Seal of the Partnership shall be a disk
inscribed with the words "Federated Exchange Fund, Ltd. 1976."
Section 2. AMENDMENTS BY MANAGING GENERAL PARTNERS. The Managing
General Partners shall have the power, at any Regular or Special Meeting or
by unanimous consent, to alter, amend or repeal any By-Laws of the
Partnership or to make new By-Laws.
Section 3. AMENDMENT BY PARTNERS. The Partners shall have the
power, at any Annual or Special Meeting, if notice thereof be included in
the notice of such meeting, to alter, amend or repeal any By-Laws of the
Partnership or to make new By-Laws.
Section 4. COMPENSATION OF MANAGING GENERAL PARTNERS. The Managing
General Partners may receive a stated salary for their services as Managing
General Partners , and by resolution of the Managing General Partners a
fixed fee and expense of attendance may be allowed for attendance at each
meeting. Nothing herein contained shall be construed to preclude any
Managing General Partner from serving the Fund in any other capacity as an
officer, agent or otherwise, and receiving compensation therefor.
Exhibit 2(i) under Form N-1A
Exhibit 3(b) under Item 601/Reg. S-K
Amendment No. 1 to By-Laws
FEDERATED EXCHANGE FUND, LTD.
Effective February 17, 1984
ARTICLE I
EXECUTIVE AND OTHER COMMITTEES
Section 1. APPOINTMENT AND TERM OF OFFICE OF EXECUTIVE COMMITTEE.
The Managing General Partners, by resolution passed by a vote of at least a
majority of the Managing General Partners, may appoint an Executive
Committee, which shall consist of two (2) or more Managing General
Partners.
ARTICLE II
OFFICERS
Section 2. ELECTION, TERM OF OFFICE AND QUALIFICATION. The Officers
shall be elected annually by the Managing General Partners. Each Officer
shall hold office until the Annual Meeting in the next year and until the
election and qualification of his successor. Any vacancy in any of the
offices may be filled for the unexpired portion of the term by the Managing
General Partners at any Regular or Special Meeting of the Managing General
Partners. The Managing General Partners may elect or appoint additional
Officers or agents at any Regular or Special Meeting of the Managing
General Partners.
Section 7. PRESIDENT. The President shall be the chief executive
officer of the Partnership. He shall, unless other provisions are made
therefor by the Managing General Partners or Executive Committee, employ
and define the duties of all employees of the Partnership, shall have the
power to discharge any such employees, shall exercise general supervision
over the affairs of the Partnership and shall perform other duties as may
be assigned to him from time to time by the Managing General Partners. In
the absence of the Chairman of the Managing General Partners, the President
shall preside at all meeting of Partners.
Exhibit 2(i)
Amendment No. 1 to By-Laws
FEDERATED SHORT-INTERMEDIATE GOVERNMENT TRUST
Effective February 2, 1987
ARTICLE II
POWERS AND DUTIES OF TRUSTEES AND OFFICERS
Section 2. Chairman of the Trustees ("Chairman"). The Chairman
shall be the chief executive officer of the Trust. He shall have general
supervision over the business of the Trust and policies of the Trust. He
shall employ and define the duties of all employees of the Trust, shall
have power to discharge any such employees, shall exercise general
supervision over the affairs of the Trust and shall perform such other
duties as may be assigned to him from time to time by the Trustees. He
shall preside at the meetings of shareholders and of the Trustees. The
Chairman shall appoint a Trustee or officer to preside at such meetings in
his absence.
Exhibit 8 under Form N-1A
Exhibit 10 under Item 601/Reg. S-K
CUSTODIAN CONTRACT
Between
FEDERATED INVESTMENT COMPANIES
and
STATE STREET BANK AND TRUST COMPANY
and
FEDERATED SERVICES COMPANY
TABLE OF CONTENTS
Page
1. Employment of Custodian and Property to be Held by It 1
2. Duties of the Custodian With Respect to Property of the Funds
Held by the Custodian 2
2.1 Holding Securities 2
2.2 Delivery of Securities 2
2.3 Registration of Securities 5
2.4 Bank Accounts 6
2.5 Payments for Shares 7
2.6 Availability of Federal Funds 7
2.7 Collection of Income 7
2.8 Payment of Fund Moneys 8
2.9 Liability for Payment in Advance of Receipt of Securities
Purchased. 9
2.10 Payments for Repurchases or Redemptions of Shares of a
Fund 9
2.11 Appointment of Agents 10
2.12 Deposit of Fund Assets in Securities System 10
2.13 Segregated Account 12
2.14 Joint Repurchase Agreements 13
2.15 Ownership Certificates for Tax Purposes 13
2.16 Proxies 13
2.17 Communications Relating to Fund Portfolio Securities 13
2.18 Proper Instructions 14
2.19 Actions Permitted Without Express Authority 14
2.20 Evidence of Authority 15
2.21 Notice to Trust by Custodian Regarding Cash Movement. 15
3. Duties of Custodian With Respect to the Books of Account and
Calculation of Net Asset Value and Net Income 15
4. Records 16
5. Opinion of Funds' Independent Public Accountants/Auditors 16
6. Reports to Trust by Independent Public Accountants/Auditors 17
7. Compensation of Custodian 17
8. Responsibility of Custodian 17
9. Effective Period, Termination and Amendment 19
10. Successor Custodian 20
11. Interpretive and Additional Provisions 21
12. Massachusetts Law to Apply 22
13. Notices 22
14. Counterparts 22
15. Limitations of Liability 22
CUSTODIAN CONTRACT
This Contract between those INVESTMENT COMPANIES listed on Exhibit 1, as it
may be amended from time to time, (the "Trust"), which may be Massachusetts
business trusts or Maryland corporations or have such other form of
organization as may be indicated, on behalf of the portfolios (hereinafter
collectively called the "Funds" and individually referred to as a "Fund")
of the Trust, having its principal place of business at Federated Investors
Tower, Pittsburgh, Pennsylvania, 15222-3779, and STATE STREET BANK AND
TRUST COMPANY, a Massachusetts trust company, having its principal place of
business at 225 Franklin Street, Boston, Massachusetts, 02110, hereinafter
called the "Custodian", and FEDERATED SERVICES COMPANY, a Delaware business
trust company, having its principal place of business at Federated
Investors Tower, Pittsburgh, Pennsylvania, 15222-3779, hereinafter called
("Company").
WITNESSETH: That in consideration of the mutual covenants and
agreements hereinafter contained, the parties hereto agree as follows:
1. Employment of Custodian and Property to be Held by It
The Trust hereby employs the Custodian as the custodian of the assets
of each of the Funds of the Trust. Except as otherwise expressly
provided herein, the securities and other assets of each of the Funds
shall be segregated from the assets of each of the other Funds and
from all other persons and entities. The Trust will deliver to the
Custodian all securities and cash owned by the Funds and all payments
of income, payments of principal or capital distributions received by
them with respect to all securities owned by the Funds from time to
time, and the cash consideration received by them for shares
("Shares") of beneficial interest/capital stock of the Funds as may
be issued or sold from time to time. The Custodian shall not be
responsible for any property of the Funds held or received by the
Funds and not delivered to the Custodian.
Upon receipt of "Proper Instructions" (within the meaning of Section
2.18), the Custodian shall from time to time employ one or more sub-
custodians upon the terms specified in the Proper Instructions,
provided that the Custodian shall have no more or less responsibility
or liability to the Trust or any of the Funds on account of any
actions or omissions of any sub-custodian so employed than any such
sub-custodian has to the Custodian.
2. Duties of the Custodian With Respect to Property of the Funds Held
by the Custodian
2.1 Holding Securities. The Custodian shall hold and physically
segregate for the account of each Fund all non-cash property,
including all securities owned by each Fund, other than
securities which are maintained pursuant to Section 2.12 in a
clearing agency which acts as a securities depository or in a
book-entry system authorized by the U.S. Department of the
Treasury, collectively referred to herein as "Securities
System", or securities which are subject to a joint repurchase
agreement with affiliated funds pursuant to Section 2.14. The
Custodian shall maintain records of all receipts, deliveries
and locations of such securities, together with a current
inventory thereof, and shall conduct periodic physical
inspections of certificates representing stocks, bonds and
other securities held by it under this Contract in such manner
as the Custodian shall determine from time to time to be
advisable in order to verify the accuracy of such inventory.
With respect to securities held by any agent appointed
pursuant to Section 2.11 hereof, and with respect to
securities held by any sub-custodian appointed pursuant to
Section 1 hereof, the Custodian may rely upon certificates
from such agent as to the holdings of such agent and from such
sub-custodian as to the holdings of such sub-custodian, it
being understood that such reliance in no way relieves the
Custodian of its responsibilities under this Contract. The
Custodian will promptly report to the Trust the results of
such inspections, indicating any shortages or discrepancies
uncovered thereby, and take appropriate action to remedy any
such shortages or discrepancies.
2.2 Delivery of Securities. The Custodian shall release and
deliver securities owned by a Fund held by the Custodian or in
a Securities System account of the Custodian only upon receipt
of Proper Instructions, which may be continuing instructions
when deemed appropriate by the parties, and only in the
following cases:
(1) Upon sale of such securities for the account of a Fund and
receipt of payment therefor;
(2) Upon the receipt of payment in connection with any
repurchase agreement related to such securities entered
into by the Trust;
(3) In the case of a sale effected through a Securities
System, in accordance with the provisions of Section 2.12
hereof;
(4) To the depository agent in connection with tender or other
similar offers for portfolio securities of a Fund, in
accordance with the provisions of Section 2.17 hereof;
(5) To the issuer thereof or its agent when such securities
are called, redeemed, retired or otherwise become payable;
provided that, in any such case, the cash or other
consideration is to be delivered to the Custodian;
(6) To the issuer thereof, or its agent, for transfer into the
name of a Fund or into the name of any nominee or nominees
of the Custodian or into the name or nominee name of any
agent appointed pursuant to Section 2.11 or into the name
or nominee name of any sub-custodian appointed pursuant to
Section 1; or for exchange for a different number of
bonds, certificates or other evidence representing the
same aggregate face amount or number of units; provided
that, in any such case, the new securities are to be
delivered to the Custodian;
(7) Upon the sale of such securities for the account of a
Fund, to the broker or its clearing agent, against a
receipt, for examination in accordance with "street
delivery custom"; provided that in any such case, the
Custodian shall have no responsibility or liability for
any loss arising from the delivery of such securities
prior to receiving payment for such securities except as
may arise from the Custodian's own failure to act in
accordance with the standard of reasonable care or any
higher standard of care imposed upon the Custodian by any
applicable law or regulation if such above-stated standard
of reasonable care were not part of this Contract;
(8) For exchange or conversion pursuant to any plan of merger,
consolidation, recapitalization, reorganization or
readjustment of the securities of the issuer of such
securities, or pursuant to provisions for conversion
contained in such securities, or pursuant to any deposit
agreement; provided that, in any such case, the new
securities and cash, if any, are to be delivered to the
Custodian;
(9) In the case of warrants, rights or similar securities, the
surrender thereof in the exercise of such warrants, rights
or similar securities or the surrender of interim receipts
or temporary securities for definitive securities;
provided that, in any such case, the new securities and
cash, if any, are to be delivered to the Custodian;
(10)For delivery in connection with any loans of portfolio
securities of a Fund, but only against receipt of adequate
collateral in the form of (a) cash, in an amount specified
by the Trust, (b) certificated securities of a description
specified by the Trust, registered in the name of the Fund
or in the name of a nominee of the Custodian referred to
in Section 2.3 hereof or in proper form for transfer, or
(c) securities of a description specified by the Trust,
transferred through a Securities System in accordance with
Section 2.12 hereof;
(11)For delivery as security in connection with any borrowings
requiring a pledge of assets by a Fund, but only against
receipt of amounts borrowed, except that in cases where
additional collateral is required to secure a borrowing
already made, further securities may be released for the
purpose;
(12)For delivery in accordance with the provisions of any
agreement among the Trust or a Fund, the Custodian and a
broker-dealer registered under the Securities Exchange Act
of 1934, as amended, (the "Exchange Act") and a member of
The National Association of Securities Dealers, Inc.
("NASD"), relating to compliance with the rules of The
Options Clearing Corporation and of any registered
national securities exchange, or of any similar
organization or organizations, regarding escrow or other
arrangements in connection with transactions for a Fund;
(13)For delivery in accordance with the provisions of any
agreement among the Trust or a Fund, the Custodian, and a
Futures Commission Merchant registered under the Commodity
Exchange Act, relating to compliance with the rules of the
Commodity Futures Trading Commission and/or any Contract
Market, or any similar organization or organizations,
regarding account deposits in connection with transaction
for a Fund;
(14)Upon receipt of instructions from the transfer agent
("Transfer Agent") for a Fund, for delivery to such
Transfer Agent or to the holders of shares in connection
with distributions in kind, in satisfaction of requests by
holders of Shares for repurchase or redemption; and
(15)For any other proper corporate purpose, but only upon
receipt of, in addition to Proper Instructions, a
certified copy of a resolution of the Executive Committee
of the Trust on behalf of a Fund signed by an officer of
the Trust and certified by its Secretary or an Assistant
Secretary, specifying the securities to be delivered,
setting forth the purpose for which such delivery is to be
made, declaring such purpose to be a proper corporate
purpose, and naming the person or persons to whom delivery
of such securities shall be made.
2.3 Registration of Securities. Securities held by the Custodian
(other than bearer securities) shall be registered in the name
of a particular Fund or in the name of any nominee of the Fund
or of any nominee of the Custodian which nominee shall be
assigned exclusively to the Fund, unless the Trust has
authorized in writing the appointment of a nominee to be used
in common with other registered investment companies
affiliated with the Fund, or in the name or nominee name of
any agent appointed pursuant to Section 2.11 or in the name or
nominee name of any sub-custodian appointed pursuant to
Section 1. All securities accepted by the Custodian on behalf
of a Fund under the terms of this Contract shall be in "street
name" or other good delivery form.
2.4 Bank Accounts. The Custodian shall open and maintain a
separate bank account or accounts in the name of each Fund,
subject only to draft or order by the Custodian acting
pursuant to the terms of this Contract, and shall hold in such
account or accounts, subject to the provisions hereof, all
cash received by it from or for the account of each Fund,
other than cash maintained in a joint repurchase account with
other affiliated funds pursuant to Section 2.14 of this
Contract or by a particular Fund in a bank account established
and used in accordance with Rule 17f-3 under the Investment
Company Act of 1940, as amended, (the "1940 Act"). Funds held
by the Custodian for a Fund may be deposited by it to its
credit as Custodian in the Banking Department of the Custodian
or in such other banks or trust companies as it may in its
discretion deem necessary or desirable; provided, however,
that every such bank or trust company shall be qualified to
act as a custodian under the 1940 Act and that each such bank
or trust company and the funds to be deposited with each such
bank or trust company shall be approved by vote of a majority
of the Board of Trustees/Directors ("Board") of the Trust.
Such funds shall be deposited by the Custodian in its capacity
as Custodian for the Fund and shall be withdrawable by the
Custodian only in that capacity. If requested by the Trust,
the Custodian shall furnish the Trust, not later than twenty
(20) days after the last business day of each month, an
internal reconciliation of the closing balance as of that day
in all accounts described in this section to the balance shown
on the daily cash report for that day rendered to the Trust.
2.5 Payments for Shares. The Custodian shall make such
arrangements with the Transfer Agent of each Fund, as will
enable the Custodian to receive the cash consideration due to
each Fund and will deposit into each Fund's account such
payments as are received from the Transfer Agent. The
Custodian will provide timely notification to the Trust and
the Transfer Agent of any receipt by it of payments for Shares
of the respective Fund.
2.6 Availability of Federal Funds. Upon mutual agreement between
the Trust and the Custodian, the Custodian shall make federal
funds available to the Funds as of specified times agreed upon
from time to time by the Trust and the Custodian in the amount
of checks, clearing house funds, and other non-federal funds
received in payment for Shares of the Funds which are
deposited into the Funds' accounts.
2.7 Collection of Income.
(1) The Custodian shall collect on a timely basis all income
and other payments with respect to registered securities
held hereunder to which each Fund shall be entitled either
by law or pursuant to custom in the securities business,
and shall collect on a timely basis all income and other
payments with respect to bearer securities if, on the date
of payment by the issuer, such securities are held by the
Custodian or its agent thereof and shall credit such
income, as collected, to each Fund's custodian account.
Without limiting the generality of the foregoing, the
Custodian shall detach and present for payment all coupons
and other income items requiring presentation as and when
they become due and shall collect interest when due on
securities held hereunder. The collection of income due
the Funds on securities loaned pursuant to the provisions
of Section 2.2 (10) shall be the responsibility of the
Trust. The Custodian will have no duty or responsibility
in connection therewith, other than to provide the Trust
with such information or data as may be necessary to
assist the Trust in arranging for the timely delivery to
the Custodian of the income to which each Fund is properly
entitled.
(2) The Custodian shall promptly notify the Trust whenever
income due on securities is not collected in due course
and will provide the Trust with monthly reports of the
status of past due income unless the parties otherwise
agree.
2.8 Payment of Fund Moneys. Upon receipt of Proper Instructions,
which may be continuing instructions when deemed appropriate
by the parties, the Custodian shall pay out moneys of each
Fund in the following cases only:
(1) Upon the purchase of securities, futures contracts or
options on futures contracts for the account of a Fund but
only (a) against the delivery of such securities, or
evidence of title to futures contracts, to the Custodian
(or any bank, banking firm or trust company doing business
in the United States or abroad which is qualified under
the 1940 Act to act as a custodian and has been designated
by the Custodian as its agent for this purpose) registered
in the name of the Fund or in the name of a nominee of the
Custodian referred to in Section 2.3 hereof or in proper
form for transfer, (b) in the case of a purchase effected
through a Securities System, in accordance with the
conditions set forth in Section 2.12 hereof or (c) in the
case of repurchase agreements entered into between the
Trust and any other party, (i) against delivery of the
securities either in certificate form or through an entry
crediting the Custodian's account at the Federal Reserve
Bank with such securities or (ii) against delivery of the
receipt evidencing purchase for the account of the Fund of
securities owned by the Custodian along with written
evidence of the agreement by the Custodian to repurchase
such securities from the Fund;
(2) In connection with conversion, exchange or surrender of
securities owned by a Fund as set forth in Section 2.2
hereof;
(3) For the redemption or repurchase of Shares of a Fund
issued by the Trust as set forth in Section 2.10 hereof;
(4) For the payment of any expense or liability incurred by a
Fund, including but not limited to the following payments
for the account of the Fund: interest; taxes; management,
accounting, transfer agent and legal fees; and operating
expenses of the Fund, whether or not such expenses are to
be in whole or part capitalized or treated as deferred
expenses;
(5) For the payment of any dividends on Shares of a Fund
declared pursuant to the governing documents of the Trust;
(6) For payment of the amount of dividends received in respect
of securities sold short;
(7) For any other proper purpose, but only upon receipt of, in
addition to Proper Instructions, a certified copy of a
resolution of the Executive Committee of the Trust on
behalf of a Fund signed by an officer of the Trust and
certified by its Secretary or an Assistant Secretary,
specifying the amount of such payment, setting forth the
purpose for which such payment is to be made, declaring
such purpose to be a proper purpose, and naming the person
or persons to whom such payment is to be made.
2.9 Liability for Payment in Advance of Receipt of Securities
Purchased. In any and every case where payment for purchase
of securities for the account of a Fund is made by the
Custodian in advance of receipt of the securities purchased,
in the absence of specific written instructions from the Trust
to so pay in advance, the Custodian shall be absolutely liable
to the Fund for such securities to the same extent as if the
securities had been received by the Custodian.
2.10Payments for Repurchases or Redemptions of Shares of a Fund.
From such funds as may be available for the purpose of
repurchasing or redeeming Shares of a Fund, but subject to the
limitations of the Declaration of Trust/Articles of
Incorporation and any applicable votes of the Board of the
Trust pursuant thereto, the Custodian shall, upon receipt of
instructions from the Transfer Agent, make funds available for
payment to holders of shares of such Fund who have delivered
to the Transfer Agent a request for redemption or repurchase
of their shares including without limitation through bank
drafts, automated clearinghouse facilities, or by other means.
In connection with the redemption or repurchase of Shares of
the Funds, the Custodian is authorized upon receipt of
instructions from the Transfer Agent to wire funds to or
through a commercial bank designated by the redeeming
shareholders.
2.11Appointment of Agents. The Custodian may at any time or times
in its discretion appoint (and may at any time remove) any
other bank or trust company which is itself qualified under
the 1940 Act and any applicable state law or regulation, to
act as a custodian, as its agent to carry out such of the
provisions of this Section 2 as the Custodian may from time to
time direct; provided, however, that the appointment of any
agent shall not relieve the Custodian of its responsibilities
or liabilities hereunder.
2.12Deposit of Fund Assets in Securities System. The Custodian
may deposit and/or maintain securities owned by the Funds in a
clearing agency registered with the Securities and Exchange
Commission ("SEC") under Section 17A of the Exchange Act,
which acts as a securities depository, or in the book-entry
system authorized by the U.S. Department of the Treasury and
certain federal agencies, collectively referred to herein as
"Securities System" in accordance with applicable Federal
Reserve Board and SEC rules and regulations, if any, and
subject to the following provisions:
(1) The Custodian may keep securities of each Fund in a
Securities System provided that such securities are
represented in an account ("Account") of the Custodian in
the Securities System which shall not include any assets
of the Custodian other than assets held as a fiduciary,
custodian or otherwise for customers;
(2) The records of the Custodian with respect to securities of
the Funds which are maintained in a Securities System
shall identify by book-entry those securities belonging to
each Fund;
(3) The Custodian shall pay for securities purchased for the
account of each Fund upon (i) receipt of advice from the
Securities System that such securities have been
transferred to the Account, and (ii) the making of an
entry on the records of the Custodian to reflect such
payment and transfer for the account of the Fund. The
Custodian shall transfer securities sold for the account
of a Fund upon (i) receipt of advice from the Securities
System that payment for such securities has been
transferred to the Account, and (ii) the making of an
entry on the records of the Custodian to reflect such
transfer and payment for the account of the Fund. Copies
of all advices from the Securities System of transfers of
securities for the account of a Fund shall identify the
Fund, be maintained for the Fund by the Custodian and be
provided to the Trust at its request. Upon request, the
Custodian shall furnish the Trust confirmation of each
transfer to or from the account of a Fund in the form of a
written advice or notice and shall furnish to the Trust
copies of daily transaction sheets reflecting each day's
transactions in the Securities System for the account of a
Fund.
(4) The Custodian shall provide the Trust with any report
obtained by the Custodian on the Securities System's
accounting system, internal accounting control and
procedures for safeguarding securities deposited in the
Securities System;
(5) The Custodian shall have received the initial certificate,
required by Section 9 hereof;
(6) Anything to the contrary in this Contract notwithstanding,
the Custodian shall be liable to the Trust for any loss or
damage to a Fund resulting from use of the Securities
System by reason of any negligence, misfeasance or
misconduct of the Custodian or any of its agents or of any
of its or their employees or from failure of the Custodian
or any such agent to enforce effectively such rights as it
may have against the Securities System; at the election of
the Trust, it shall be entitled to be subrogated to the
rights of the Custodian with respect to any claim against
the Securities System or any other person which the
Custodian may have as a consequence of any such loss or
damage if and to the extent that a Fund has not been made
whole for any such loss or damage.
(7) The authorization contained in this Section 2.12 shall not
relieve the Custodian from using reasonable care and
diligence in making use of any Securities System.
2.13Segregated Account. The Custodian shall upon receipt of
Proper Instructions establish and maintain a segregated
account or accounts for and on behalf of each Fund, into which
account or accounts may be transferred cash and/or securities,
including securities maintained in an account by the Custodian
pursuant to Section 2.12 hereof, (i) in accordance with the
provisions of any agreement among the Trust, the Custodian and
a broker-dealer registered under the Exchange Act and a member
of the NASD (or any futures commission merchant registered
under the Commodity Exchange Act), relating to compliance with
the rules of The Options Clearing Corporation and of any
registered national securities exchange (or the Commodity
Futures Trading Commission or any registered contract market),
or of any similar organization or organizations, regarding
escrow or other arrangements in connection with transactions
for a Fund, (ii) for purpose of segregating cash or government
securities in connection with options purchased, sold or
written for a Fund or commodity futures contracts or options
thereon purchased or sold for a Fund, (iii) for the purpose of
compliance by the Trust or a Fund with the procedures required
by any release or releases of the SEC relating to the
maintenance of segregated accounts by registered investment
companies and (iv) for other proper corporate purposes, but
only, in the case of clause (iv), upon receipt of, in addition
to Proper Instructions, a certified copy of a resolution of
the Board or of the Executive Committee signed by an officer
of the Trust and certified by the Secretary or an Assistant
Secretary, setting forth the purpose or purposes of such
segregated account and declaring such purposes to be proper
corporate purposes.
2.14Joint Repurchase Agreements. Upon the receipt of Proper
Instructions, the Custodian shall deposit and/or maintain any
assets of a Fund and any affiliated funds which are subject to
joint repurchase transactions in an account established solely
for such transactions for the Fund and its affiliated funds.
For purposes of this Section 2.14, "affiliated funds" shall
include all investment companies and their portfolios for
which subsidiaries or affiliates of Federated Investors serve
as investment advisers, distributors or administrators in
accordance with applicable exemptive orders from the SEC. The
requirements of segregation set forth in Section 2.1 shall be
deemed to be waived with respect to such assets.
2.15Ownership Certificates for Tax Purposes. The Custodian shall
execute ownership and other certificates and affidavits for
all federal and state tax purposes in connection with receipt
of income or other payments with respect to securities of a
Fund held by it and in connection with transfers of
securities.
2.16Proxies. The Custodian shall, with respect to the securities
held hereunder, cause to be promptly executed by the
registered holder of such securities, if the securities are
registered otherwise than in the name of a Fund or a nominee
of a Fund, all proxies, without indication of the manner in
which such proxies are to be voted, and shall promptly deliver
to the Trust such proxies, all proxy soliciting materials and
all notices relating to such securities.
2.17Communications Relating to Fund Portfolio Securities. The
Custodian shall transmit promptly to the Trust all written
information (including, without limitation, pendency of calls
and maturities of securities and expirations of rights in
connection therewith and notices of exercise of call and put
options written by the Fund and the maturity of futures
contracts purchased or sold by the Fund) received by the
Custodian from issuers of the securities being held for the
Fund. With respect to tender or exchange offers, the
Custodian shall transmit promptly to the Trust all written
information received by the Custodian from issuers of the
securities whose tender or exchange is sought and from the
party (or his agents) making the tender or exchange offer. If
the Trust desires to take action with respect to any tender
offer, exchange offer or any other similar transaction, the
Trust shall notify the Custodian in writing at least three
business days prior to the date on which the Custodian is to
take such action. However, the Custodian shall nevertheless
exercise its best efforts to take such action in the event
that notification is received three business days or less
prior to the date on which action is required.
2.18Proper Instructions. Proper Instructions as used throughout
this Section 2 means a writing signed or initialed by one or
more person or persons as the Board shall have from time to
time authorized. Each such writing shall set forth the
specific transaction or type of transaction involved. Oral
instructions will be deemed to be Proper Instructions if (a)
the Custodian reasonably believes them to have been given by a
person previously authorized in Proper Instructions to give
such instructions with respect to the transaction involved,
and (b) the Trust promptly causes such oral instructions to be
confirmed in writing. Upon receipt of a certificate of the
Secretary or an Assistant Secretary as to the authorization by
the Board of the Trust accompanied by a detailed description
of procedures approved by the Board, Proper Instructions may
include communications effected directly between electro-
mechanical or electronic devices provided that the Board and
the Custodian are satisfied that such procedures afford
adequate safeguards for a Fund's assets.
2.19Actions Permitted Without Express Authority. The Custodian
may in its discretion, without express authority from the
Trust:
(1) make payments to itself or others for minor expenses of
handling securities or other similar items relating to its
duties under this Contract, provided that all such
payments shall be accounted for to the Trust in such form
that it may be allocated to the affected Fund;
(2) surrender securities in temporary form for securities in
definitive form;
(3) endorse for collection, in the name of a Fund, checks,
drafts and other negotiable instruments; and
(4) in general, attend to all non-discretionary details in
connection with the sale, exchange, substitution,
purchase, transfer and other dealings with the securities
and property of each Fund except as otherwise directed by
the Trust.
2.20Evidence of Authority. The Custodian shall be protected in
acting upon any instructions, notice, request, consent,
certificate or other instrument or paper reasonably believed
by it to be genuine and to have been properly executed on
behalf of a Fund. The Custodian may receive and accept a
certified copy of a vote of the Board of the Trust as
conclusive evidence (a) of the authority of any person to act
in accordance with such vote or (b) of any determination of or
any action by the Board pursuant to the Declaration of
Trust/Articles of Incorporation as described in such vote, and
such vote may be considered as in full force and effect until
receipt by the Custodian of written notice to the contrary.
2.21Notice to Trust by Custodian Regarding Cash Movement. The
Custodian will provide timely notification to the Trust of any
receipt of cash, income or payments to the Trust and the
release of cash or payment by the Trust.
3. Duties of Custodian With Respect to the Books of Account and
Calculation of Net Asset Value and Net Income.
The Custodian shall cooperate with and supply necessary information
to the entity or entities appointed by the Board of the Trust to keep
the books of account of each Fund and/or compute the net asset value
per share of the outstanding Shares of each Fund or, if directed in
writing to do so by the Trust, shall itself keep such books of
account and/or compute such net asset value per share. If so
directed, the Custodian shall also calculate daily the net income of
a Fund as described in the Fund's currently effective prospectus and
Statement of Additional Information ("Prospectus") and shall advise
the Trust and the Transfer Agent daily of the total amounts of such
net income and, if instructed in writing by an officer of the Trust
to do so, shall advise the Transfer Agent periodically of the
division of such net income among its various components. The
calculations of the net asset value per share and the daily income of
a Fund shall be made at the time or times described from time to time
in the Fund's currently effective Prospectus.
4. Records.
The Custodian shall create and maintain all records relating to its
activities and obligations under this Contract in such manner as will
meet the obligations of the Trust and the Funds under the 1940 Act,
with particular attention to Section 31 thereof and Rules 31a-1 and
31a-2 thereunder, and specifically including identified cost records
used for tax purposes. All such records shall be the property of the
Trust and shall at all times during the regular business hours of the
Custodian be open for inspection by duly authorized officers,
employees or agents of the Trust and employees and agents of the SEC.
In the event of termination of this Contract, the Custodian will
deliver all such records to the Trust, to a successor Custodian, or
to such other person as the Trust may direct. The Custodian shall
supply daily to the Trust a tabulation of securities owned by a Fund
and held by the Custodian and shall, when requested to do so by the
Trust and for such compensation as shall be agreed upon between the
Trust and the Custodian, include certificate numbers in such
tabulations.
5. Opinion of Funds' Independent Public Accountants/Auditors.
The Custodian shall take all reasonable action, as the Trust may from
time to time request, to obtain from year to year favorable opinions
from each Fund's independent public accountants/auditors with respect
to its activities hereunder in connection with the preparation of the
Fund's registration statement, periodic reports, or any other reports
to the SEC and with respect to any other requirements of such
Commission.
6. Reports to Trust by Independent Public Accountants/Auditors.
The Custodian shall provide the Trust, at such times as the Trust may
reasonably require, with reports by independent public
accountants/auditors for each Fund on the accounting system, internal
accounting control and procedures for safeguarding securities,
futures contracts and options on futures contracts, including
securities deposited and/or maintained in a Securities System,
relating to the services provided by the Custodian for the Fund under
this Contract; such reports shall be of sufficient scope and in
sufficient detail, as may reasonably be required by the Trust, to
provide reasonable assurance that any material inadequacies would be
disclosed by such examination and, if there are no such inadequacies,
the reports shall so state.
7. Compensation of Custodian.
The Custodian shall be entitled to reasonable compensation for its
services and expenses as Custodian, as agreed upon from time to time
between Company and the Custodian.
8. Responsibility of Custodian.
The Custodian shall be held to a standard of reasonable care in
carrying out the provisions of this Contract; provided, however, that
the Custodian shall be held to any higher standard of care which
would be imposed upon the Custodian by any applicable law or
regulation if such above stated standard of reasonable care was not
part of this Contract. The Custodian shall be entitled to rely on
and may act upon advice of counsel (who may be counsel for the Trust)
on all matters, and shall be without liability for any action
reasonably taken or omitted pursuant to such advice, provided that
such action is not in violation of applicable federal or state laws
or regulations, and is in good faith and without negligence. Subject
to the limitations set forth in Section 15 hereof, the Custodian
shall be kept indemnified by the Trust but only from the assets of
the Fund involved in the issue at hand and be without liability for
any action taken or thing done by it in carrying out the terms and
provisions of this Contract in accordance with the above standards.
In order that the indemnification provisions contained in this
Section 8 shall apply, however, it is understood that if in any case
the Trust may be asked to indemnify or save the Custodian harmless,
the Trust shall be fully and promptly advised of all pertinent facts
concerning the situation in question, and it is further understood
that the Custodian will use all reasonable care to identify and
notify the Trust promptly concerning any situation which presents or
appears likely to present the probability of such a claim for
indemnification. The Trust shall have the option to defend the
Custodian against any claim which may be the subject of this
indemnification, and in the event that the Trust so elects it will so
notify the Custodian and thereupon the Trust shall take over complete
defense of the claim, and the Custodian shall in such situation
initiate no further legal or other expenses for which it shall seek
indemnification under this Section. The Custodian shall in no case
confess any claim or make any compromise in any case in which the
Trust will be asked to indemnify the Custodian except with the
Trust's prior written consent.
Notwithstanding the foregoing, the responsibility of the Custodian
with respect to redemptions effected by check shall be in accordance
with a separate Agreement entered into between the Custodian and the
Trust.
If the Trust requires the Custodian to take any action with respect
to securities, which action involves the payment of money or which
action may, in the reasonable opinion of the Custodian, result in the
Custodian or its nominee assigned to a Fund being liable for the
payment of money or incurring liability of some other form, the
Custodian may request the Trust, as a prerequisite to requiring the
Custodian to take such action, to provide indemnity to the Custodian
in an amount and form satisfactory to the Custodian.
Subject to the limitations set forth in Section 15 hereof, the Trust
agrees to indemnify and hold harmless the Custodian and its nominee
from and against all taxes, charges, expenses, assessments, claims
and liabilities (including counsel fees) (referred to herein as
authorized charges) incurred or assessed against it or its nominee in
connection with the performance of this Contract, except such as may
arise from it or its nominee's own failure to act in accordance with
the standard of reasonable care or any higher standard of care which
would be imposed upon the Custodian by any applicable law or
regulation if such above-stated standard of reasonable care were not
part of this Contract. To secure any authorized charges and any
advances of cash or securities made by the Custodian to or for the
benefit of a Fund for any purpose which results in the Fund incurring
an overdraft at the end of any business day or for extraordinary or
emergency purposes during any business day, the Trust hereby grants
to the Custodian a security interest in and pledges to the Custodian
securities held for the Fund by the Custodian, in an amount not to
exceed 10 percent of the Fund's gross assets, the specific securities
to be designated in writing from time to time by the Trust or the
Fund's investment adviser. Should the Trust fail to make such
designation, or should it instruct the Custodian to make advances
exceeding the percentage amount set forth above and should the
Custodian do so, the Trust hereby agrees that the Custodian shall
have a security interest in all securities or other property
purchased for a Fund with the advances by the Custodian, which
securities or property shall be deemed to be pledged to the
Custodian, and the written instructions of the Trust instructing
their purchase shall be considered the requisite description and
designation of the property so pledged for purposes of the
requirements of the Uniform Commercial Code. Should the Trust fail
to cause a Fund to repay promptly any authorized charges or advances
of cash or securities, subject to the provision of the second
paragraph of this Section 8 regarding indemnification, the Custodian
shall be entitled to use available cash and to dispose of pledged
securities and property as is necessary to repay any such advances.
9. Effective Period, Termination and Amendment.
This Contract shall become effective as of its execution, shall
continue in full force and effect until terminated as hereinafter
provided, may be amended at any time by mutual agreement of the
parties hereto and may be terminated by either party by an instrument
in writing delivered or mailed, postage prepaid to the other party,
such termination to take effect not sooner than sixty (60) days after
the date of such delivery or mailing; provided, however that the
Custodian shall not act under Section 2.12 hereof in the absence of
receipt of an initial certificate of the Secretary or an Assistant
Secretary that the Board of the Trust has approved the initial use of
a particular Securities System as required in each case by Rule 17f-4
under the 1940 Act; provided further, however, that the Trust shall
not amend or terminate this Contract in contravention of any
applicable federal or state regulations, or any provision of the
Declaration of Trust/Articles of Incorporation, and further provided,
that the Trust may at any time by action of its Board (i) substitute
another bank or trust company for the Custodian by giving notice as
described above to the Custodian, or (ii) immediately terminate this
Contract in the event of the appointment of a conservator or receiver
for the Custodian by the appropriate banking regulatory agency or
upon the happening of a like event at the direction of an appropriate
regulatory agency or court of competent jurisdiction.
Upon termination of the Contract, the Trust shall pay to the
Custodian such compensation as may be due as of the date of such
termination and shall likewise reimburse the Custodian for its costs,
expenses and disbursements.
10. Successor Custodian.
If a successor custodian shall be appointed by the Board of the
Trust, the Custodian shall, upon termination, deliver to such
successor custodian at the office of the Custodian, duly endorsed and
in the form for transfer, all securities then held by it hereunder
for each Fund and shall transfer to separate accounts of the
successor custodian all of each Fund's securities held in a
Securities System.
If no such successor custodian shall be appointed, the Custodian
shall, in like manner, upon receipt of a certified copy of a vote of
the Board of the Trust, deliver at the office of the Custodian and
transfer such securities, funds and other properties in accordance
with such vote.
In the event that no written order designating a successor custodian
or certified copy of a vote of the Board shall have been delivered to
the Custodian on or before the date when such termination shall
become effective, then the Custodian shall have the right to deliver
to a bank or trust company, which is a "bank" as defined in the 1940
Act, (delete "doing business ... Massachusetts" unless SSBT is the
Custodian) doing business in Boston, Massachusetts, of its own
selection, having an aggregate capital, surplus, and undivided
profits, as shown by its last published report, of not less than
$100,000,000, all securities, funds and other properties held by the
Custodian and all instruments held by the Custodian relative thereto
and all other property held by it under this Contract for each Fund
and to transfer to separate accounts of such successor custodian all
of each Fund's securities held in any Securities System. Thereafter,
such bank or trust company shall be the successor of the Custodian
under this Contract.
In the event that securities, funds and other properties remain in
the possession of the Custodian after the date of termination hereof
owing to failure of the Trust to procure the certified copy of the
vote referred to or of the Board to appoint a successor custodian,
the Custodian shall be entitled to fair compensation for its services
during such period as the Custodian retains possession of such
securities, funds and other properties and the provisions of this
Contract relating to the duties and obligations of the Custodian
shall remain in full force and effect.
11. Interpretive and Additional Provisions.
In connection with the operation of this Contract, the Custodian and
the Trust may from time to time agree on such provisions interpretive
of or in addition to the provisions of this Contract as may in their
joint opinion be consistent with the general tenor of this Contract.
Any such interpretive or additional provisions shall be in a writing
signed by both parties and shall be annexed hereto, provided that no
such interpretive or additional provisions shall contravene any
applicable federal or state regulations or any provision of the
Declaration of Trust/Articles of Incorporation. No interpretive or
additional provisions made as provided in the preceding sentence
shall be deemed to be an amendment of this Contract.
12. Massachusetts Law to Apply.
This Contract shall be construed and the provisions thereof
interpreted under and in accordance with laws of The Commonwealth of
Massachusetts.
13. Notices.
Except as otherwise specifically provided herein, Notices and other
writings delivered or mailed postage prepaid to the Trust at
Federated Investors Tower, Pittsburgh, Pennsylvania, 15222-3779, or
to the Custodian at address for SSBT only: 225 Franklin Street,
Boston, Massachusetts, 02110, or to such other address as the Trust
or the Custodian may hereafter specify, shall be deemed to have been
properly delivered or given hereunder to the respective address.
14. Counterparts.
This Contract may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original.
15. Limitations of Liability.
The Custodian is expressly put on notice of the limitation of
liability as set forth in Article XI of the Declaration of Trust of
those Trusts which are business trusts and agrees that the
obligations and liabilities assumed by the Trust and any Fund
pursuant to this Contract, including, without limitation, any
obligation or liability to indemnify the Custodian pursuant to
Section 8 hereof, shall be limited in any case to the relevant Fund
and its assets and that the Custodian shall not seek satisfaction of
any such obligation from the shareholders of the relevant Fund, from
any other Fund or its shareholders or from the Trustees, Officers,
employees or agents of the Trust, or any of them. In addition, in
connection with the discharge and satisfaction of any claim made by
the Custodian against the Trust, for whatever reasons, involving more
than one Fund, the Trust shall have the exclusive right to determine
the appropriate allocations of liability for any such claim between
or among the Funds.
IN WITNESS WHEREOF, each of the parties has caused this instrument to be
executed in its name and behalf by its duly authorized representative and
its seal to be hereunder affixed effective as of the 1st day of December,
1993.
ATTEST: INVESTMENT COMPANIES
/s/John G. McGonigle_________ By /s/John G. Donahue_____________
John G. McGonigle John F. Donahue
Secretary Chairman
ATTEST: STATE STREET BANK AND TRUST
COMPANY
/s/ Ed McKenzie______________ By /s/ F. J. Sidoti, Jr.___________
(Assistant) Secretary Typed Name: Frank J. Sidoti, Jr.
Typed Name: Ed McKenzie Title: Vice President
ATTEST: FEDERATED SERVICES COMPANY
/s/ Jeannette Fisher-Garber______ By /s/ James J. Dolan________________
Jeannette Fisher-Garber James J. Dolan
Secretary President
EXHIBIT 1
<TABLE>
<S> <C>
CONTRACT
DATE INVESTMENT COMPANY
12/1/93 Federated Exchange Fund, Ltd.
</TABLE>
Exhibit 9(i) under Form N-1A
Exhibit 10 under Item 601/Reg. S-K
SHAREHOLDER SERVICES PLAN
This Shareholder Services Plan ("Plan") is adopted as of this 1st day
of March, 1994, by the Boards of Directors or Trustees, as applicable (the
"Boards"), of those investment companies listed on Exhibit 1 hereto as may
be amended from time to time, having their principal office and place of
business at Federated Investors Tower, Pittsburgh, PA 15222-3779
(individually referred to herein as a "Fund" and collectively as "Funds").
1. This Plan is adopted to allow the Funds to make payments as
contemplated herein to obtain certain personal services for shareholders
and/or the maintenance of shareholder accounts ("Services").
2. This Plan is designed to compensate Federated Shareholder
Services ("FSS") for providing personal services and/or the maintenance of
shareholder accounts to the Funds and their shareholders. In compensation
for the services provided pursuant to this Plan, FSS may be paid a monthly
fee computed at the annual rate not to exceed .25 of 1% of the average
aggregate net asset value of the shares of each Fund held during the month.
3. Any payments made by the Funds to FSS pursuant to this Plan
will be made pursuant to a "Shareholder Services Agreement" between FSS and
each of the Funds.
4. Quarterly in each year that this Plan remains in effect, FSS
shall prepare and furnish to the Boards of the Funds, and the Boards shall
review, a written report of the amounts expended under the Plan.
5. This Plan shall become effective with regard to each Fund
(i) after approval by majority votes of: (a) such Fund's Board; and (b)
the members of the Board of such Fund who are not interested persons of
such Fund and have no direct or indirect financial interest in the
operation of such Fund's Plan or in any related documents to the Plan
("Independent Trustees or Directors"), cast in person at a meeting called
for the purpose of voting on the Plan.
6. This Plan shall remain in effect with respect to each Fund
presently set forth on an exhibit and any subsequent Fund added pursuant to
an exhibit during the initial year of this Plan for the period of one year
from the date set forth above and may be continued thereafter if this Plan
is approved with respect to each Fund at least annually by a majority of
the relevant Fund's Board and a majority of the Independent Trustees or
Directors, of such Fund as applicable, cast in person at a meeting called
for the purpose of voting on the renewal of such Plan. If this Plan is
adopted with respect to a fund after the first annual approval by the
Trustees or Directors as described above, this Plan will be effective as to
that Fund at such time as Exhibit 1 hereto is amended to add such Fund and
will continue in effect until the next annual approval of this Plan by the
Funds' Boards and thereafter for successive periods of one year subject to
approval as described above.
7. All material amendments to this Plan must be approved by a vote
of the Board of each Fund and of the Independent Directors or Trustees of
such Fund, cast in person at a meeting called for such purpose.
8. This Plan may be terminated as follows:
(a) at any time, without the payment of any penalty, by the
vote of a majority of the Independent Board Members of any Fund or
by a vote of a majority of the outstanding voting securities of any
Fund as defined in the Investment Company Act of 1940 on sixty (60)
days' written notice to the parties to this Agreement; or
(b) by any party to the Agreement without cause by giving
the other party at least sixty (60) days' written notice of its
intention to terminate.
9. While this Plan shall be in effect, the selection and
nomination of Independent Directors or Trustees of each Fund shall be
committed to the discretion of the Independent Directors or Trustees then
in office.
10. All agreements with any person relating to the implementation
of this Plan shall be in writing and any agreement related to this Plan
shall be subject to termination, without penalty, pursuant to the
provisions of Paragraph 8 herein.
11. This Plan shall be construed in accordance with and governed by
the laws of the Commonwealth of Pennsylvania.
Witness the due execution hereof this as of the date set forth above.
Investment Companies (listed
on Exhibit 1)
By: /s/ John F. Donahue
John F. Donahue
Chairman
Attest: /s/ John W. McGonigle
John W. McGonigle
Federated Shareholder Services
By: /s/ James J. Dolan
Title: President
Attest: /s/ John W. McGonigle
John W. McGonigle
Exhibit 1
Federated Exchange Fund, Ltd.
Exhibit 9(ii) under Form N-1A
Exhibit 10 under Item 601/Reg. S-K
SHAREHOLDER SERVICES SUB-CONTRACT
This Agreement is made between the Financial Institution executing
this Agreement ("Provider") and Federated Shareholder Services ("FSS") on
behalf of the investment companies listed in Exhibit A hereto (the
"Funds"), for whom FSS administers the Shareholder Services Plan ("Plan")
and who have approved this form of Agreement. In consideration of the
mutual covenants hereinafter contained, it is hereby agreed by and between
the parties hereto as follows:
1. FSS hereby appoints Provider to render or cause to be rendered
personal services to shareholders of the Funds and/or the maintenance of
accounts of shareholders of the Funds ("Services"). Provider agrees to
provide Services which, in its best judgment, are necessary or desirable
for its customers who are investors in the Funds. Provider further agrees
to provide FSS, upon request, a written description of the Services which
Provider is providing hereunder.
2. During the term of this Agreement, the Funds will pay the
Provider fees as set forth in a written schedule delivered to the Provider
pursuant to this Agreement. The fee schedule for Provider may be changed
by FSS sending a new fee schedule to Provider pursuant to Paragraph 9 of
this Agreement. For the payment period in which this Agreement becomes
effective or terminates, there shall be an appropriate proration of the fee
on the basis of the number of days that this Agreement is in effect during
the quarter. To enable the Funds to comply with an applicable exemptive
order, Provider represents that the fees received pursuant to this
Agreement will be disclosed to its customers, will be authorized by its
customers, and will not result in an excessive fee to the Provider.
3. The Provider understands that the Department of Labor views
ERISA as prohibiting fiduciaries of discretionary ERISA assets from
receiving shareholder service fees or other compensation from funds in
which the fiduciary's discretionary ERISA assets are invested. To date,
the Department of Labor has not issued any exemptive order or advisory
opinion that would exempt fiduciaries from this interpretation. Without
specific authorization from the Department of Labor, fiduciaries should
carefully avoid investing discretionary assets in any fund pursuant to an
arrangement where the fiduciary is to be compensated by the fund for such
investment. Receipt of such compensation could violate ERISA provisions
against fiduciary self-dealing and conflict of interest and could subject
the fiduciary to substantial penalties.
4. The Provider agrees not to solicit or cause to be solicited
directly, or indirectly at any time in the future, any proxies from the
shareholders of a Fund in opposition to proxies solicited by management of
the Fund, unless a court of competent jurisdiction shall have determined
that the conduct of a majority of the Board of Trustees or Directors of the
Fund constitutes willful misfeasance, bad faith, gross negligence or
reckless disregard of their duties. This paragraph 4 will survive the term
of this Agreement.
5. This Agreement shall continue in effect for one year from the
date of its execution, and thereafter for successive periods of one year if
the form of this Agreement is approved at least annually by the Board of
each Fund, including a majority of the members of the Board of the Fund who
are not interested persons of the Fund and have no direct or indirect
financial interest in the operation of the Fund's Plan or in any related
documents to the Plan ("Disinterested Board Members") cast in person at a
meeting called for that purpose.
6. Notwithstanding paragraph 5, this Agreement may be terminated
as follows:
(a) at any time, without the payment of any penalty, by the
vote of a majority of the Disinterested Board Members of the Fund
or by a vote of a majority of the outstanding voting securities of
the Fund as defined in the Investment Company Act of 1940 on not
more than sixty (60) days' written notice to the parties to this
Agreement;
(b) automatically in the event of the Agreement's
assignment as defined in the Investment Company Act of 1940; and
(c) by either party to the Agreement without cause by
giving the other party at least sixty (60) days' written notice of
its intention to terminate.
7. The Provider agrees to obtain any taxpayer identification
number certification from its customers required under Section 3406 of the
Internal Revenue Code, and any applicable Treasury regulations, and to
provide the Fund or its designee with timely written notice of any failure
to obtain such taxpayer identification number certification in order to
enable the implementation of any required backup withholding.
8. The execution and delivery of this Agreement have been
authorized by the Trustees of FSS and signed by an authorized officer of
FSS, acting as such, and neither such authorization by such Trustees nor
such execution and delivery by such officer shall be deemed to have been
made by any of them individually or to impose any liability on any of them
personally, and the obligations of this Agreement are not binding upon any
of the Trustees or shareholders of FSS, but bind only the trust property of
FSS as provided in the Declaration of Trust of FSS.
9. Notices of any kind to be given hereunder shall be in writing
(including facsimile communication) and shall be duly given if delivered to
Provider at the address set forth below and if delivered to FSS at
Federated Investors Tower, Pittsburgh, PA 15222-3779, Attention:
President.
10. This Agreement constitutes the entire agreement between the
parties hereto and supersedes any prior agreement with respect to the
subject hereof whether oral or written. If any provision of this Agreement
shall be held or made invalid by a court or regulatory agency decision,
statute, rule or otherwise, the remainder of this Agreement shall not be
affected thereby. Subject to the provisions of Sections 5 and 6, hereof,
this Agreement shall be binding upon and shall inure to the benefit of the
parties hereto and their respective successors and shall be governed by
Pennsylvania law; provided, however, that nothing herein shall be construed
in a manner inconsistent with the Investment Company Act of 1940 or any
rule or regulation promulgated by the Securities and Exchange Commission
thereunder.
11. This Agreement may be executed by different parties on separate
counterparts, each of which, when so executed and delivered, shall be an
original, and all such counterparts shall together constitute one and the
same instrument.
12. This Agreement shall not be assigned by any party without the
prior written consent of FSS in the case of assignment by Provider, or of
Provider in the case of assignment by FSS, except that any party may assign
to a successor all of or a substantial portion of its business to a party
controlling, controlled by, or under common control with such party.
13. This Agreement may be amended by FSS from time to time by the
following procedure. FSS will mail a copy of the amendment to the
Provider's address, as shown below. If the Provider does not object to the
amendment within thirty (30) days after its receipt, the amendment will
become part of the Agreement. The Provider's objection must be in writing
and be received by FSS within such thirty days.
14. This Agreement may be terminated with regard to a particular
Fund or Class at any time, without the payment of any penalty, by FSS or by
the vote of a majority of the Disinterested Trustees or Directors, as
applicable, or by a majority of the outstanding voting securities of the
particular Fund or Class on not more than sixty (60) days' written notice
to the Provider. This Agreement may be terminated by Provider on sixty
(60) days' written notice to FSS.
15. The Provider acknowledges and agrees that FSS has entered into
this Agreement solely in the capacity of agent for the Funds and
administrator of the Plan. The Provider agrees not to claim that FSS is
liable for any responsibilities or amounts due by the Funds hereunder.
[Provider]
Address
City State Zip Code
Dated: By:
Authoried Signature
Title
Print Name of Authorized Signature
FEDERATED SHAREHOLDER SERVICES
Federated Investors Tower
Pittsburgh, Pennsylvania 15222-3779
By:
Vice President
EXHIBIT A to Shareholder Services Sub-Contract with
Funds covered by this Agreement:
Federated Exchange Fund, Ltd.
Shareholder Service Fees
1. During the term of this Agreement, FSS will pay Provider a
quarterly fee. This fee will be computed at the annual rate of ______ of
the average net asset value of shares of the Funds held during the quarter
in accounts for which the Provider provides Services under this Agreement,
so long as the average net asset value of Shares in the Funds during the
quarter equals or exceeds such minimum amount as FSS shall from time to
time determine and communicate in writing to the Provider.
2. For the quarterly period in which the Agreement becomes
effective or terminates, there shall be an appropriate proration of any fee
payable on the basis of the number of days that the Agreement is in effect
during the quarter.
Exhibit 9(iii) under Form N-1A
Exhibit 10 under Item 601/Reg. S-K
SHAREHOLDER SERVICES AGREEMENT
AGREEMENT made as of the first day of March, 1994, by and between
those investment companies listed on Exhibit 1, as may be amended from time
to time, having their principal office and place of business at Federated
Investors Tower, Pittsburgh, PA 15222-3779 and who have approved a
Shareholder Services Plan (the "Plan") and this form of Agreement
(individually referred to herein as a "Fund" and collectively as "Funds")
and Federated Shareholder Services, a Delaware business trust, having its
principal office and place of business at Federated Investors Tower,
Pittsburgh, Pennsylvania 15222-3779 ("FSS").
1. The Funds hereby appoint FSS to render or cause to be rendered
personal services to shareholders of the Funds and/or the maintenance of
accounts of shareholders of the Funds ("Services"). In addition to
providing Services directly to shareholders of the Funds, FSS is hereby
appointed the Funds' agent to select, negotiate and subcontract for the
performance of Services. FSS hereby accepts such appointments. FSS agrees
to provide or cause to be provided Services which, in its best judgment
(subject to supervision and control of the Funds' Boards of Trustees or
Directors, as applicable), are necessary or desirable for shareholders of
the Funds. FSS further agrees to provide the Funds, upon request, a
written description of the Services which FSS is providing hereunder.
2. During the term of this Agreement, each Fund will pay FSS and
FSS agrees to accept as full compensation for its services rendered
hereunder a fee at an annual rate, calculated daily and payable monthly, up
to 0.25% of 1% of average net assets of each Fund.
For the payment period in which this Agreement becomes effective or
terminates with respect to any Fund, there shall be an appropriate
proration of the monthly fee on the basis of the number of days that this
Agreement is in effect with respect to such Fund during the month. To
enable the Funds to comply with an applicable exemptive order, FSS
represents that the fees received pursuant to this Agreement will be
disclosed to and authorized by any person or entity receiving Services, and
will not result in an excessive fee to FSS.
3. This Agreement shall continue in effect for one year from the
date of its execution, and thereafter for successive periods of one year
only if the form of this Agreement is approved at least annually by the
Board of each Fund, including a majority of the members of the Board of the
Fund who are not interested persons of the Fund and have no direct or
indirect financial interest in the operation of the Funds' Plan or in any
related documents to the Plan ("Independent Board Members") cast in person
at a meeting called for that purpose.
4. Notwithstanding paragraph 3, this Agreement may be terminated
as follows:
(a) at any time, without the payment of any penalty, by the
vote of a majority of the Independent Board Members of any Fund or
by a vote of a majority of the outstanding voting securities of any
Fund as defined in the Investment Company Act of 1940 on sixty (60)
days' written notice to the parties to this Agreement;
(b) automatically in the event of the Agreement's
assignment as defined in the Investment Company Act of 1940; and
(c) by any party to the Agreement without cause by giving
the other party at least sixty (60) days' written notice of its
intention to terminate.
5. FSS agrees to obtain any taxpayer identification number
certification from each shareholder of the Funds to which it provides
Services that is required under Section 3406 of the Internal Revenue Code,
and any applicable Treasury regulations, and to provide each Fund or its
designee with timely written notice of any failure to obtain such taxpayer
identification number certification in order to enable the implementation
of any required backup withholding.
6. FSS shall not be liable for any error of judgment or mistake of
law or for any loss suffered by any Fund in connection with the matters to
which this Agreement relates, except a loss resulting from willful
misfeasance, bad faith or gross negligence on its part in the performance
of its duties or from reckless disregard by it of its obligations and
duties under this Agreement. FSS shall be entitled to rely on and may act
upon advice of counsel (who may be counsel for such Fund) on all matters,
and shall be without liability for any action reasonably taken or omitted
pursuant to such advice. Any person, even though also an officer, trustee,
partner, employee or agent of FSS, who may be or become a member of such
Fund's Board, officer, employee or agent of any Fund, shall be deemed, when
rendering services to such Fund or acting on any business of such Fund
(other than services or business in connection with the duties of FSS
hereunder) to be rendering such services to or acting solely for such Fund
and not as an officer, trustee, partner, employee or agent or one under the
control or direction of FSS even though paid by FSS.
This Section 6 shall survive termination of this Agreement.
7. No provision of this Agreement may be changed, waived,
discharged or terminated orally, but only by an instrument in writing
signed by the party against which an enforcement of the change, waiver,
discharge or termination is sought.
8. FSS is expressly put on notice of the limitation of liability
as set forth in the Declaration of Trust of each Fund that is a
Massachusetts business trust and agrees that the obligations assumed by
each such Fund pursuant to this Agreement shall be limited in any case to
such Fund and its assets and that FSS shall not seek satisfaction of any
such obligations from the shareholders of such Fund, the Trustees,
Officers, Employees or Agents of such Fund, or any of them.
9. The execution and delivery of this Agreement have been
authorized by the Trustees of FSS and signed by an authorized officer of
FSS, acting as such, and neither such authorization by such Trustees nor
such execution and delivery by such officer shall be deemed to have been
made by any of them individually or to impose any liability on any of them
personally, and the obligations of this Agreement are not binding upon any
of the Trustees or shareholders of FSS, but bind only the trust property of
FSS as provided in the Declaration of Trust of FSS.
10. Notices of any kind to be given hereunder shall be in writing
(including facsimile communication) and shall be duly given if delivered to
any Fund and to such Fund at the following address: Federated Investors
Tower, Pittsburgh, PA 15222-3779, Attention: President and if delivered
to FSS at Federated Investors Tower, Pittsburgh, PA 15222-3779, Attention:
President.
11. This Agreement constitutes the entire agreement between the
parties hereto and supersedes any prior agreement with respect to the
subject hereof whether oral or written. If any provision of this Agreement
shall be held or made invalid by a court or regulatory agency decision,
statute, rule or otherwise, the remainder of this Agreement shall not be
affected thereby. Subject to the provisions of Sections 3 and 4, hereof,
this Agreement shall be binding upon and shall inure to the benefit of the
parties hereto and their respective successors and shall be governed by
Pennsylvania law; provided, however, that nothing herein shall be construed
in a manner inconsistent with the Investment Company Act of 1940 or any
rule or regulation promulgated by the Securities and Exchange Commission
thereunder.
12. This Agreement may be executed by different parties on separate
counterparts, each of which, when so executed and delivered, shall be an
original, and all such counterparts shall together constitute one and the
same instrument.
13. This Agreement shall not be assigned by any party without the
prior written consent of FSS in the case of assignment by any Fund, or of
the Funds in the case of assignment by FSS, except that any party may
assign to a successor all of or a substantial portion of its business to a
party controlling, controlled by, or under common control with such party.
Nothing in this Section 14 shall prevent FSS from delegating its
responsibilities to another entity to the extent provided herein.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be executed by their officers designated below as of the day and year first
above written.
Investment Companies (listed
on Exhibit 1)
By: /s/ John F. Donahue
John F. Donahue
Chairman
Attest: /s/ John W. McGonigle
John W. McGonigle
Federated Shareholder Services
By: /s/ James J. Dolan
Title: President
Attest: /s/ John W. McGonigle
John W. McGonigle
Exhibit 1
Federated Exchange Fund, Ltd.
Exhibit 9(iv) under Form N-1A
Exhibit 10 under Item 601/Reg. S-K
ADMINISTRATIVE SERVICES AGREEMENT
This Administrative Services Agreement is made as of this first day
of March, 1994, between those investment companies listed on Exhibit 1, as
may be amended from time to time, having their principal office and place
of business at Federated Investors Tower, Pittsburgh PA 15222-3779
(individually referred to herein as "Fund" and collectively referred to as
"Funds), on behalf of the portfolios of the Funds, and Federated
Administrative Services, a Delaware business trust (herein called "FAS").
WHEREAS, the Funds desire to retain FAS as their Administrator to
provide them with Administrative Services (as herein defined), and FAS is
willing to render such services;
WHEREAS, the Funds are registered as open-end management investment
companies under the Investment Company Act of 1940, as amended (the "1940
Act"), with authorized and issued shares of capital stock or beneficial
interest ("Shares"); and
NOW, THEREFORE, in consideration of the premises and mutual
covenants set forth herein, the parties hereto agree as follows:
1. Appointment of Administrator. The Funds hereby appoint FAS as
Administrator of the Funds on the terms and conditions set forth in this
Agreement; and FAS hereby accepts such appointment and agrees to perform
the services and duties set forth in Section 2 of this Agreement in
consideration of the compensation provided for in Section 4 hereof.
2. Services and Duties. As Administrator, and subject to the
supervision and control of the Funds' Boards of Trustees or Directors, as
applicable (the "Boards"), FAS will provide facilities, equipment, and
personnel to carry out the following administrative services for operation
of the business and affairs of the Funds and each of their portfolios:
(a) prepare, file, and maintain the
Funds' governing documents and any amendments thereto,
including the Declaration of Trust or Articles of
Incorporation, as appropriate,(which has already been
prepared and filed), the By-laws and minutes of meetings of
their Boards, Committees, and shareholders;
(b) prepare and file with the
Securities and Exchange Commission and the appropriate state
securities authorities the registration statements for the
Funds and the Funds' shares and all amendments thereto,
reports to regulatory authorities and shareholders,
prospectuses, proxy statements, and such other documents all
as may be necessary to enable the Funds to make continuous
offerings of their shares, as applicable;
(c) prepare, negotiate, and administer
contracts on behalf of the Funds with, among others, each
Fund's investment adviser, distributor, custodian, and
transfer agent, subject to any applicable restrictions of the
Boards or the 1940 Act;
(d) supervise the Funds' custodians in
the maintenance of the Funds' general ledgers and in the
preparation of the Funds' financial statements, including
oversight of expense accruals and payments, the determination
of the net asset value of the Funds and the declaration and
payment of dividends and other distributions to shareholders;
(e) calculate performance data of the
Funds for dissemination to information services covering the
investment company industry;
(f) prepare and file the Funds' tax
returns;
(g) examine and review the operations
of the Funds' custodians and transfer agents;
(h) coordinate the layout and printing
of publicly disseminated prospectuses and reports;
(i) perform internal audit examinations
in accordance with a charter to be adopted by FAS and the
Funds;
(j) assist with the design,
development, and operation of the Funds;
(k) provide individuals reasonably
acceptable to the Funds' Boards for nomination, appointment,
or election as officers of the Funds, who will be responsible
for the management of certain of the Funds' affairs as
determined by the Funds' Boards; and
(l) consult with the Funds and their
Boards of Trustees or Directors, as appropriate, on matters
concerning the Funds and their affairs.
The foregoing, along with any additional services that FAS shall
agree in writing to perform for the Funds hereunder, shall hereafter be
referred to as "Administrative Services." Administrative Services shall
not include any duties, functions, or services to be performed for any
Fund by such Fund's investment adviser, distributor, custodian, transfer
agent, or shareholder service agent, pursuant to their respective
agreements with such Fund.
3. Expenses. FAS shall be responsible for expenses incurred in
providing office space, equipment, and personnel as may be necessary or
convenient to provide the Administrative Services to the Fund, including
the compensation of FAS employees who serve on the Funds' Boards, or as
officers of the Funds. Each Fund shall be responsible for all other
expenses incurred by FAS on behalf of such Fund, including without
limitation postage and courier expenses, printing expenses, travel
expenses, registration fees, filing fees, fees of outside counsel and
independent auditors, insurance premiums, fees payable to members of such
Fund's Board who are not FAS employees, and trade association dues.
4. Compensation. For the Administrative Services provided, each
Fund hereby agrees to pay and FAS hereby agrees to accept as full
compensation for its services rendered hereunder an administrative fee at
an annual rate, payable daily, as specified below, based upon the total
assets of all of the Funds:
Maximum Administrative Average Daily Net Assets
Fee of the Funds
.150% on the first $250 million
.125% on the next $250 million
.100% on the next $250
million
.075% on assets in excess of
$750 million
However, in no event shall the administrative fee received during
any year of this Agreement be less than, or be paid at a rate less than
would aggregate, $125,000, per individual Fund, with an additional $30,000
for each class of shares added to any such Fund after the date hereof.
5. Standard of Care.
(a) FAS shall not be liable for any
error of judgment or mistake of law or for any loss suffered
by any Fund in connection with the matters to which this
Agreement relates, except a loss resulting from willful
misfeasance, bad faith or gross negligence on its part in the
performance of its duties or from reckless disregard by it of
its obligations and duties under this Agreement. FAS shall
be entitled to rely on and may act upon advice of counsel
(who may be counsel for such Fund) on all matters, and shall
be without liability for any action reasonably taken or
omitted pursuant to such advice. Any person, even though
also an officer, trustee, partner, employee or agent of FAS,
who may be or become a member of such Fund's Board, officer,
employee or agent of any Fund, shall be deemed, when
rendering services to such Fund or acting on any business of
such Fund (other than services or business in connection with
the duties of FAS hereunder) to be rendering such services to
or acting solely for such Fund and not as an officer,
trustee, partner, employee or agent or one under the control
or direction of FAS even though paid by FAS.
(b) This Section 5 shall survive
termination of this Agreement.
6. Duration and Termination. The initial term of this Agreement
with respect to each Fund shall commence on the date hereof, and extend
for a period of one year, renewable annually by the approval of the Board
of Directors/Trustees of each Fund.
7. Amendment. No provision of this Agreement may be changed,
waived, discharged or terminated orally, but only by an instrument in
writing signed by the party against which an enforcement of the change,
waiver, discharge or termination is sought.
8. Limitations of Liability of Trustees or Officers, Employees,
Agents and Shareholders of the Funds. FAS is expressly put on notice of
the limitation of liability as set forth in the Declaration of Trust of
each Fund that is a Massachusetts business trust and agrees that the
obligations assumed by each such Fund pursuant to this Agreement shall be
limited in any case to such Fund and its assets and that FAS shall not
seek satisfaction of any such obligations from the shareholders of such
Fund, the Trustees, Officers, Employees or Agents of such Fund, or any of
them.
9. Limitations of Liability of Trustees and Shareholders of FAS.
The execution and delivery of this Agreement have been authorized by the
Trustees of FAS and signed by an authorized officer of FAS, acting as
such, and neither such authorization by such Trustees nor such execution
and delivery by such officer shall be deemed to have been made by any of
them individually or to impose any liability on any of them personally,
and the obligations of this Agreement are not binding upon any of the
Trustees or shareholders of FAS, but bind only the trust property of FAS
as provided in the Declaration of Trust of FAS.
10. Notices. Notices of any kind to be given hereunder shall
be in writing (including facsimile communication) and shall be duly given
if delivered to any Fund at the following address: Federated Investors
Tower, Pittsburgh, PA 15222-3779, Attention: President and if delivered
to FAS at Federated Investors Tower, Pittsburgh, PA 15222-3779,
Attention: President.
11. Miscellaneous. This Agreement constitutes the entire
agreement between the parties hereto and supersedes any prior agreement
with respect to the subject hereof whether oral or written. The captions
in this Agreement are included for convenience of reference only and in no
way define or delimit any of the provisions hereof or otherwise affect
their construction or effect. If any provision of this Agreement shall be
held or made invalid by a court or regulatory agency decision, statute,
rule or otherwise, the remainder of this Agreement shall not be affected
thereby. Subject to the provisions of Section 5, hereof, this Agreement
shall be binding upon and shall inure to the benefit of the parties hereto
and their respective successors and shall be governed by Pennsylvania law;
provided, however, that nothing herein shall be construed in a manner
inconsistent with the Investment Company Act of 1940 or any rule or
regulation promulgated by the Securities and Exchange Commission
thereunder.
12. Counterparts. This Agreement may be executed by different
parties on separate counterparts, each of which, when so executed and
delivered, shall be an original, and all such counterparts shall together
constitute one and the same instrument.
13. Assignment; Successors. This Agreement shall not be assigned
by any party without the prior written consent of FAS, in the case of
assignment by any Fund, or of the Funds, in the case of assignment by FAS,
except that any party may assign to a successor all of or a substantial
portion of its business to a party controlling, controlled by, or under
common control with such party. Nothing in this Section 14 shall prevent
FAS from delegating its responsibilities to another entity to the extent
provided herein.
IN WITNESS WHEREOF, the parties hereto have caused this instrument
to be executed by their officers designated below as of the day and year
first above written.
Investment Companies (listed
on Exhibit 1)
By: /s/ John F. Donahue
John F. Donahue
Chairman
Attest: /s/ John W. McGonigle
John W. McGonigle
Federated Administrative Services
By: /s/ Edward C. Gonzales
Edward C. Gonzales
Chairman
Attest: /s/ John W. McGonigle
John W. McGonigle
Exhibit 1
Federated Exchange Fund, Ltd.
Exhibit 9(v) under Form N-1A
Exhibit 10 under Item 601/Reg. S-K
AGREEMENT
for
FUND ACCOUNTING,
SHAREHOLDER RECORDKEEPING,
and
CUSTODY SERVICES PROCUREMENT
AGREEMENT made as of December 1, 1994, by and between those investment
companies listed on Exhibit 1 as may be amended from time to time, having
their principal office and place of business at Federated Investors
Tower, Pittsburgh, PA 15222-3779 (the "Trust"), on behalf of the
portfolios (individually referred to herein as a "Fund" and collectively
as "Funds") of the Trust, and FEDERATED SERVICES COMPANY, a Delaware
business trust, having its principal office and place of business at
Federated Investors Tower, Pittsburgh, Pennsylvania 15222-3779 (the
"Company").
WHEREAS, the Trust is registered as an open-end management investment
company under the Investment Company Act of 1940, as amended (the
"1940 Act"), with authorized and issued shares of capital stock or
beneficial interest ("Shares"); and
WHEREAS, the Trust may desire to retain the Company to provide certain
pricing, accounting and recordkeeping services for each of the Funds,
including any classes of shares issued by any Fund ("Classes") if so
indicated on Exhibit 1, and the Company is willing to furnish such
services; and
WHEREAS, the Trust may desire to appoint the Company as its transfer
agent, dividend disbursing agent if so indicated on Exhibit 1, and agent
in connection with certain other activities, and the Company desires to
accept such appointment; and
WHEREAS, the Trust may desire to appoint the Company as its agent to
select, negotiate and subcontract for custodian services from an approved
list of qualified banks if so indicated on Exhibit 1, and the Company
desires to accept such appointment; and
WHEREAS, from time to time the Trust may desire and may instruct the
Company to subcontract for the performance of certain of its duties and
responsibilities hereunder to State Street Bank and Trust Company or
another agent (the "Agent"); and
WHEREAS, the words Trust and Fund may be used interchangeably for
those investment companies consisting of only one portfolio;
NOW THEREFORE, in consideration of the premises and mutual covenants
herein contained, and intending to be legally bound hereby, the parties
hereto agree as follows:
SECTION ONE: Fund Accounting.
Article 1. Appointment.
The Trust hereby appoints the Company to provide certain pricing and
accounting services to the Funds, and/or the Classes, for the period and
on the terms set forth in this Agreement. The Company accepts such
appointment and agrees to furnish the services herein set forth in return
for the compensation as provided in Article 3 of this Section.
Article 2. The Company's Duties.
Subject to the supervision and control of the Trust's Board of
Trustees or Directors ("Board"), the Company will assist the Trust with
regard to fund accounting for the Trust, and/or the Funds, and/or the
Classes, and in connection therewith undertakes to perform the following
specific services;
A. Value the assets of the Funds using: primarily, market
quotations, including the use of matrix pricing, supplied by
the independent pricing services selected by the Company in
consultation with the adviser, or sources selected by the
adviser, and reviewed by the board; secondarily, if a
designated pricing service does not provide a price for a
security which the Company believes should be available by
market quotation, the Company may obtain a price by calling
brokers designated by the investment adviser of the fund
holding the security, or if the adviser does not supply the
names of such brokers, the Company will attempt on its own to
find brokers to price those securities; thirdly, for
securities for which no market price is available, the Pricing
Committee of the Board will determine a fair value in good
faith. Consistent with Rule 2a-4 of the 40 Act, estimates may
be used where necessary or appropriate. The Company's
obligations with regard to the prices received from outside
pricing services and designated brokers or other outside
sources, is to exercise reasonable care in the supervision of
the pricing agent. The Company is not the guarantor of the
securities prices received from such agents and the Company is
not liable to the Fund for potential errors in valuing a
Fund's assets or calculating the net asset value per share of
such Fund or Class when the calculations are based upon such
prices. All of the above sources of prices used as described
are deemed by the Company to be authorized sources of security
prices. The Company provides daily to the adviser the
securities prices used in calculating the net asset value of
the fund, for its use in preparing exception reports for those
prices on which the adviser has comment. Further, upon receipt
of the exception reports generated by the adviser, the Company
diligently pursues communication regarding exception reports
with the designated pricing agents.
B. Determine the net asset value per share of each Fund and/or
Class, at the time and in the manner from time to time
determined by the Board and as set forth in the Prospectus and
Statement of Additional Information ("Prospectus") of each
Fund;
C. Calculate the net income of each of the Funds, if any;
D. Calculate capital gains or losses of each of the Funds
resulting from sale or disposition of assets, if any;
E. Maintain the general ledger and other accounts, books and
financial records of the Trust, including for each Fund,
and/or Class, as required under Section 31(a) of the 1940 Act
and the Rules thereunder in connection with the services
provided by the Company;
F. Preserve for the periods prescribed by Rule 31a-2 under the
1940 Act the records to be maintained by Rule 31a-1 under the
1940 Act in connection with the services provided by the
Company. The Company further agrees that all such records it
maintains for the Trust are the property of the Trust and
further agrees to surrender promptly to the Trust such records
upon the Trust's request;
G. At the request of the Trust, prepare various reports or other
financial documents required by federal, state and other
applicable laws and regulations; and
H. Such other similar services as may be reasonably requested by
the Trust.
Article 3. Compensation and Allocation of Expenses.
A. The Funds will compensate the Company for its services
rendered pursuant to Section One of this Agreement in
accordance with the fees agreed upon from time to time between
the parties hereto. Such fees do not include out-of-pocket
disbursements of the Company for which the Funds shall
reimburse the Company upon receipt of a separate invoice. Out-
of-pocket disbursements shall include, but shall not be
limited to, the items agreed upon between the parties from
time to time.
B. The Fund and/or the Class, and not the Company, shall bear the
cost of: custodial expenses; membership dues in the Investment
Company Institute or any similar organization; transfer agency
expenses; investment advisory expenses; costs of printing and
mailing stock certificates, Prospectuses, reports and notices;
administrative expenses; interest on borrowed money; brokerage
commissions; taxes and fees payable to federal, state and
other governmental agencies; fees of Trustees or Directors of
the Trust; independent auditors expenses; Federated
Administrative Services and/or Federated Administrative
Services, Inc. legal and audit department expenses billed to
Federated Services Company for work performed related to the
Trust, the Funds, or the Classes; law firm expenses; or other
expenses not specified in this Article 3 which may be properly
payable by the Funds and/or classes.
C. The compensation and out-of-pocket expenses shall be accrued
by the Fund and shall be paid to the Company no less
frequently than monthly, and shall be paid daily upon request
of the Company. The Company will maintain detailed information
about the compensation and out-of-pocket expenses by Fund and
Class.
D. Any schedule of compensation agreed to hereunder, as may be
adjusted from time to time, shall be dated and signed by a
duly authorized officer of the Trust and/or the Funds and a
duly authorized officer of the Company.
E. The fee for the period from the effective date of this
Agreement with respect to a Fund or a Class to the end of the
initial month shall be prorated according to the proportion
that such period bears to the full month period. Upon any
termination of this Agreement before the end of any month, the
fee for such period shall be prorated according to the
proportion which such period bears to the full month period.
For purposes of determining fees payable to the Company, the
value of the Fund's net assets shall be computed at the time
and in the manner specified in the Fund's Prospectus.
F. The Company, in its sole discretion, may from time to time
subcontract to, employ or associate with itself such person or
persons as the Company may believe to be particularly suited
to assist it in performing services under this Section One.
Such person or persons may be third-party service providers,
or they may be officers and employees who are employed by both
the Company and the Funds. The compensation of such person or
persons shall be paid by the Company and no obligation shall
be incurred on behalf of the Trust, the Funds, or the Classes
in such respect.
SECTION TWO: Shareholder Recordkeeping.
Article 4. Terms of Appointment.
Subject to the terms and conditions set forth in this Agreement, the
Trust hereby appoints the Company to act as, and the Company agrees to
act as, transfer agent and dividend disbursing agent for each Fund's
Shares, and agent in connection with any accumulation, open-account or
similar plans provided to the shareholders of any Fund
("Shareholder(s)"), including without limitation any periodic investment
plan or periodic withdrawal program.
As used throughout this Agreement, a "Proper Instruction" means a
writing signed or initialed by one or more person or persons as the Board
shall have from time to time authorized. Each such writing shall set
forth the specific transaction or type of transaction involved. Oral
instructions will be deemed to be Proper Instructions if (a) the Company
reasonably believes them to have been given by a person previously
authorized in Proper Instructions to give such instructions with respect
to the transaction involved, and (b) the Trust, or the Fund, and the
Company promptly cause such oral instructions to be confirmed in writing.
Proper Instructions may include communications effected directly between
electro-mechanical or electronic devices provided that the Trust, or the
Fund, and the Company are satisfied that such procedures afford adequate
safeguards for the Fund's assets. Proper Instructions may only be amended
in writing.
Article 5. Duties of the Company.
The Company shall perform the following services in accordance with
Proper Instructions as may be provided from time to time by the Trust as
to any Fund:
A. Purchases
(1) The Company shall receive orders and payment for the
purchase of shares and promptly deliver payment and
appropriate documentation therefore to the custodian of
the relevant Fund, (the "Custodian"). The Company shall
notify the Fund and the Custodian on a daily basis of the
total amount of orders and payments so delivered.
(2) Pursuant to purchase orders and in accordance with the
Fund's current Prospectus, the Company shall compute and
issue the appropriate number of Shares of each Fund and/or
Class and hold such Shares in the appropriate Shareholder
accounts.
(3) For certificated Funds and/or Classes, if a Shareholder or
its agent requests a certificate, the Company, as Transfer
Agent, shall countersign and mail by first class mail, a
certificate to the Shareholder at its address as set forth
on the transfer books of the Funds, and/or Classes,
subject to any Proper Instructions regarding the delivery
of certificates.
(4) In the event that any check or other order for the
purchase of Shares of the Fund and/or Class is returned
unpaid for any reason, the Company shall debit the Share
account of the Shareholder by the number of Shares that
had been credited to its account upon receipt of the check
or other order, promptly mail a debit advice to the
Shareholder, and notify the Fund and/or Class of its
action. In the event that the amount paid for such Shares
exceeds proceeds of the redemption of such Shares plus the
amount of any dividends paid with respect to such Shares,
the Fund and/the Class or its distributor will reimburse
the Company on the amount of such excess.
B. Distribution
(1) Upon notification by the Funds of the declaration of any
distribution to Shareholders, the Company shall act as
Dividend Disbursing Agent for the Funds in accordance with
the provisions of its governing document and the then-
current Prospectus of the Fund. The Company shall prepare
and mail or credit income, capital gain, or any other
payments to Shareholders. As the Dividend Disbursing
Agent, the Company shall, on or before the payment date of
any such distribution, notify the Custodian of the
estimated amount required to pay any portion of said
distribution which is payable in cash and request the
Custodian to make available sufficient funds for the cash
amount to be paid out. The Company shall reconcile the
amounts so requested and the amounts actually received
with the Custodian on a daily basis. If a Shareholder is
entitled to receive additional Shares by virtue of any
such distribution or dividend, appropriate credits shall
be made to the Shareholder's account, for certificated
Funds and/or Classes, delivered where requested; and
(2) The Company shall maintain records of account for each
Fund and Class and advise the Trust, each Fund and Class
and its Shareholders as to the foregoing.
C. Redemptions and Transfers
(1) The Company shall receive redemption requests and
redemption directions and, if such redemption requests
comply with the procedures as may be described in the Fund
Prospectus or set forth in Proper Instructions, deliver
the appropriate instructions therefor to the Custodian.
The Company shall notify the Funds on a daily basis of the
total amount of redemption requests processed and monies
paid to the Company by the Custodian for redemptions.
(2) At the appropriate time upon receiving redemption proceeds
from the Custodian with respect to any redemption, the
Company shall pay or cause to be paid the redemption
proceeds in the manner instructed by the redeeming
Shareholders, pursuant to procedures described in the then-
current Prospectus of the Fund.
(3) If any certificate returned for redemption or other
request for redemption does not comply with the procedures
for redemption approved by the Fund, the Company shall
promptly notify the Shareholder of such fact, together
with the reason therefor, and shall effect such redemption
at the price applicable to the date and time of receipt of
documents complying with said procedures.
(4) The Company shall effect transfers of Shares by the
registered owners thereof.
(5) The Company shall identify and process abandoned accounts
and uncashed checks for state escheat requirements on an
annual basis and report such actions to the Fund.
D. Recordkeeping
(1) The Company shall record the issuance of Shares of each
Fund, and/or Class, and maintain pursuant to applicable
rules of the Securities and Exchange Commission ("SEC") a
record of the total number of Shares of the Fund and/or
Class which are authorized, based upon data provided to it
by the Fund, and issued and outstanding. The Company shall
also provide the Fund on a regular basis or upon
reasonable request with the total number of Shares which
are authorized and issued and outstanding, but shall have
no obligation when recording the issuance of Shares,
except as otherwise set forth herein, 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 Funds.
(2) The Company shall establish and maintain records pursuant
to applicable rules of the SEC relating to the services to
be performed hereunder in the form and manner as agreed to
by the Trust or the Fund to include a record for each
Shareholder's account of the following:
(a) Name, address and tax identification number (and
whether such number has been certified);
(b) Number of Shares held;
(c) Historical information regarding the account,
including dividends paid and date and price for all
transactions;
(d) Any stop or restraining order placed against the
account;
(e) Information with respect to withholding in the case of
a foreign account or an account for which withholding
is required by the Internal Revenue Code;
(f) Any dividend reinvestment order, plan application,
dividend address and correspondence relating to the
current maintenance of the account;
(g) Certificate numbers and denominations for any
Shareholder holding certificates;
(h) Any information required in order for the Company to
perform the calculations contemplated or required by
this Agreement.
(3) The Company shall preserve any such records required to be
maintained pursuant to the rules of the SEC for the
periods prescribed in said rules as specifically noted
below. Such record retention shall be at the expense of
the Company, and such records may be inspected by the Fund
at reasonable times. The Company may, at its option at any
time, and shall forthwith upon the Fund's demand, turn
over to the Fund and cease to retain in the Company's
files, records and documents created and maintained by the
Company pursuant to this Agreement, which are no longer
needed by the Company in performance of its services or
for its protection. If not so turned over to the Fund,
such records and documents will be retained by the Company
for six years from the year of creation, during the first
two of which such documents will be in readily accessible
form. At the end of the six year period, such records and
documents will either be turned over to the Fund or
destroyed in accordance with Proper Instructions.
E. Confirmations/Reports
(1) The Company shall furnish to the Fund periodically the
following information:
(a) A copy of the transaction register;
(b) Dividend and reinvestment blotters;
(c) The total number of Shares issued and outstanding in
each state for "blue sky" purposes as determined
according to Proper Instructions delivered from time
to time by the Fund to the Company;
(d) Shareholder lists and statistical information;
(e) Payments to third parties relating to distribution
agreements, allocations of sales loads, redemption
fees, or other transaction- or sales-related
payments;
(f) Such other information as may be agreed upon from time
to time.
(2) The Company shall prepare in the appropriate form, file
with the Internal Revenue Service and appropriate state
agencies, and, if required, mail to Shareholders, such
notices for reporting dividends and distributions paid as
are required to be so filed and mailed and shall withhold
such sums as are required to be withheld under applicable
federal and state income tax laws, rules and regulations.
(3) In addition to and not in lieu of the services set forth
above, the Company shall:
(a) Perform all of the customary services of a transfer
agent, dividend disbursing agent and, as relevant,
agent in connection with accumulation, open-account
or similar plans (including without limitation any
periodic investment plan or periodic withdrawal
program), including but not limited to: maintaining
all Shareholder accounts, mailing Shareholder reports
and Prospectuses to current Shareholders, withholding
taxes on accounts subject to back-up or other
withholding (including non-resident alien accounts),
preparing and filing reports on U.S. Treasury
Department Form 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
conformable transactions in Shareholder accounts,
preparing and mailing activity statements for
Shareholders, and providing Shareholder account
information; and
(b) provide a system which will enable the Fund to monitor
the total number of Shares of each Fund and/or Class
sold in each state ("blue sky reporting"). The Fund
shall by Proper Instructions (i) identify to the
Company those transactions and assets to be treated
as exempt from the blue sky reporting for each state
and (ii) verify the classification of transactions
for each state on the system prior to activation and
thereafter monitor the daily activity for each state.
The responsibility of the Company for each Fund's
and/or Class's state blue sky registration status is
limited solely to the recording of the initial
classification of transactions or accounts with
regard to blue sky compliance and the reporting of
such transactions and accounts to the Fund as
provided above.
F. Other Duties
(1) The Company shall answer correspondence from Shareholders
relating to their Share accounts and such other
correspondence as may from time to time be addressed to
the Company;
(2) The Company shall prepare Shareholder meeting lists, mail
proxy cards and other material supplied to it by the Fund
in connection with Shareholder Meetings of each Fund;
receive, examine and tabulate returned proxies, and
certify the vote of the Shareholders;
(3) The Company shall establish and maintain facilities and
procedures 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.
Article 6. Duties of the Trust.
A. Compliance
The Trust or Fund assume full responsibility for the preparation,
contents and distribution of their own and/or their classes'
Prospectus and for complying with all applicable requirements of
the Securities Act of 1933, as amended (the "1933 Act"), the 1940
Act and any laws, rules and regulations of government authorities
having jurisdiction.
B. Share Certificates
The Trust shall supply the Company with a sufficient supply of
blank Share certificates and from time to time shall renew such
supply upon request of the Company. Such blank Share certificates
shall be properly signed, manually or by facsimile, if authorized
by the Trust and shall bear the seal of the Trust or facsimile
thereof; and notwithstanding the death, resignation or removal of
any officer of the Trust authorized to sign certificates, the
Company may continue to countersign certificates which bear the
manual or facsimile signature of such officer until otherwise
directed by the Trust.
C. Distributions
The Fund shall promptly inform the Company of the declaration of
any dividend or distribution on account of any Fund's shares.
Article 7. Compensation and Expenses.
A. Annual Fee
For performance by the Company pursuant to Section Two of this
Agreement, the Trust and/or the Fund agree to pay the Company an
annual maintenance fee for each Shareholder account as agreed
upon between the parties and as may be added to or amended from
time to time. Such fees may be changed from time to time subject
to written agreement between the Trust and the Company. Pursuant
to information in the Fund Prospectus or other information or
instructions from the Fund, the Company may sub-divide any Fund
into Classes or other sub-components for recordkeeping purposes.
The Company will charge the Fund the same fees for each such
Class or sub-component the same as if each were a Fund.
B. Reimbursements
In addition to the fee paid under Article 7A above, the Trust
and/or Fund agree to reimburse the Company for out-of-pocket
expenses or advances incurred by the Company for the items agreed
upon between the parties, as may be added to or amended from time
to time. In addition, any other expenses incurred by the Company
at the request or with the consent of the Trust and/or the Fund,
will be reimbursed by the appropriate Fund.
C. Payment
The compensation and out-of-pocket expenses shall be accrued
by the Fund and shall be paid to the Company no less
frequently than monthly, and shall be paid daily upon request
of the Company. The Company will maintain detailed information
about the compensation and out-of-pocket expenses by Fund and
Class.
D. Any schedule of compensation agreed to hereunder, as may be
adjusted from time to time, shall be dated and signed by a
duly authorized officer of the Trust and/or the Funds and a
duly authorized officer of the Company.
Article 8. Assignment of Shareholder Recordkeeping.
Except as provided below, no right or obligation under this Section
Two may be assigned by either party without the written consent of the
other party.
A. This Agreement shall inure to the benefit of and be binding
upon the parties and their respective permitted successors and
assigns.
B. The Company may without further consent on the part of the
Trust subcontract for the performance hereof with (A) State
Street Bank and its subsidiary, Boston Financial Data
Services, Inc., a Massachusetts Trust ("BFDS"), which is duly
registered as a transfer agent pursuant to Section 17A(c)(1)
of the Securities Exchange Act of 1934, as amended, or any
succeeding statute ("Section 17A(c)(1)"), or (B) a BFDS
subsidiary duly registered as a transfer agent pursuant to
Section 17A(c)(1), or (C) a BFDS affiliate, or (D) such other
provider of services duly registered as a transfer agent under
Section 17A(c)(1) as Company shall select; provided, however,
that the Company shall be as fully responsible to the Trust
for the acts and omissions of any subcontractor as it is for
its own acts and omissions; or
C. The Company shall upon instruction from the Trust subcontract
for the performance hereof with an Agent selected by the
Trust, other than BFDS or a provider of services selected by
Company, as described in (2) above; provided, however, that
the Company shall in no way be responsible to the Trust for
the acts and omissions of the Agent.
SECTION THREE: Custody Services Procurement.
Article 9. Appointment.
The Trust hereby appoints Company as its agent to evaluate and obtain
custody services from a financial institution that (i) meets the criteria
established in Section 17(f) of the 1940 Act and (ii) has been approved
by the Board as eligible for selection by the Company as a custodian (the
"Eligible Custodian"). The Company accepts such appointment.
Article 10. The Company and Its Duties.
Subject to the review, supervision and control of the Board, the
Company shall:
A. evaluate the nature and the quality of the custodial services
provided by the Eligible Custodian;
B. employ the Eligible Custodian to serve on behalf of the Trust
as Custodian of the Trust's assets substantially on the terms
set forth as the form of agreement in Exhibit 2;
C. negotiate and enter into agreements with the Custodians for
the benefit of the Trust, with the Trust as a party to each
such agreement. The Company shall not be a party to any
agreement with any such Custodian;
D. establish procedures to monitor the nature and the quality of
the services provided by the Custodians;
E. continuously monitor the nature and the quality of services
provided by the Custodians; and
F. periodically provide to the Trust (i) written reports on the
activities and services of the Custodians; (ii) the nature and
amount of disbursement made on account of the Trust with
respect to each custodial agreement; and (iii) such other
information as the Board shall reasonably request to enable it
to fulfill its duties and obligations under Sections 17(f) and
36(b) of the 1940 Act and other duties and obligations
thereof.
Article 11. Fees and Expenses.
A. Annual Fee
For the performance by the Company pursuant to Section Three
of this Agreement, the Trust and/or the Fund agree to pay the
Company an annual fee as agreed upon between the parties.
B. Reimbursements
In addition to the fee paid under Section 11A above, the Trust
and/or Fund agree to reimburse the Company for out-of-pocket
expenses or advances incurred by the Company for the items agreed
upon between the parties, as may be added to or amended from time
to time. In addition, any other expenses incurred by the Company
at the request or with the consent of the Trust and/or the Fund,
will be reimbursed by the appropriate Fund.
C. Payment
The compensation and out-of-pocket expenses shall be accrued
by the Fund and shall be paid to the Company no less
frequently than monthly, and shall be paid daily upon request
of the Company. The Company will maintain detailed information
about the compensation and out-of-pocket expenses by Fund.
D. Any schedule of compensation agreed to hereunder, as may be
adjusted from time to time, shall be dated and signed by a
duly authorized officer of the Trust and/or the Funds and a
duly authorized officer of the Company.
Article 12. Representations.
The Company represents and warrants that it has obtained all required
approvals from all government or regulatory authorities necessary to
enter into this arrangement and to provide the services contemplated in
Section Three of this Agreement.
SECTION FOUR: General Provisions.
Article 13. Documents.
A. In connection with the appointment of the Company under this
Agreement, the Trust shall file with the Company the following
documents:
(1) A copy of the Charter and By-Laws of the Trust and all
amendments thereto;
(2) A copy of the resolution of the Board of the Trust
authorizing this Agreement;
(3) Specimens of all forms of outstanding Share certificates
of the Trust or the Funds in the forms approved by the
Board of the Trust with a certificate of the Secretary of
the Trust as to such approval;
(4) All account application forms and other documents relating
to Shareholders accounts; and
(5) A copy of the current Prospectus for each Fund.
B. The Fund will also furnish from time to time the following
documents:
(1) Each resolution of the Board of the Trust authorizing the
original issuance of each Fund's, and/or Class's Shares;
(2) Each Registration Statement filed with the SEC and
amendments thereof and orders relating thereto in effect
with respect to the sale of Shares of any Fund, and/or
Class;
(3) A certified copy of each amendment to the governing
document and the By-Laws of the Trust;
(4) Certified copies of each vote of the Board authorizing
officers to give Proper Instructions to the Custodian and
agents for fund accountant, custody services procurement,
and shareholder recordkeeping or transfer agency services;
(5) Specimens of all new Share certificates representing
Shares of any Fund, accompanied by Board resolutions
approving such forms;
(6) Such other certificates, documents or opinions which the
Company may, in its discretion, deem necessary or
appropriate in the proper performance of its duties; and
(7) Revisions to the Prospectus of each Fund.
Article 14. Representations and Warranties.
A. Representations and Warranties of the Company
The Company represents and warrants to the Trust that:
(1) It is a business trust duly organized and existing and in
good standing under the laws of the State of Delaware.
(2) It is duly qualified to carry on its business in the State
of Delaware.
(3) It is empowered under applicable laws and by its charter
and by-laws to enter into and perform this Agreement.
(4) All requisite corporate proceedings have been taken to
authorize it to enter into and perform its obligations
under this Agreement.
(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.
(6) It is in compliance with federal securities law
requirements and in good standing as a transfer agent.
B. Representations and Warranties of the Trust
The Trust represents and warrants to the Company that:
(1) It is an investment company duly organized and existing
and in good standing under the laws of its state of
organization;
(2) It is empowered under applicable laws and by its Charter
and By-Laws to enter into and perform its obligations
under this Agreement;
(3) All corporate proceedings required by said Charter and By-
Laws have been taken to authorize it to enter into and
perform its obligations under this Agreement;
(4) The Trust is an open-end investment company registered
under the 1940 Act; and
(5) A registration statement under the 1933 Act will be
effective, and appropriate state securities law filings
have been made and will continue to be made, with respect
to all Shares of each Fund being offered for sale.
Article 15. Standard of Care and Indemnification.
A. Standard of Care
The Company shall be held to a standard of reasonable care in
carrying out the provisions of this Contract. The Company shall
be entitled to rely on and may act upon advice of counsel (who
may be counsel for the Trust) on all matters, and shall be
without liability for any action reasonably taken or omitted
pursuant to such advice, provided that such action is not in
violation of applicable federal or state laws or regulations, and
is in good faith and without negligence.
B. Indemnification by Trust
The Company shall not be responsible for and the Trust or Fund
shall indemnify and hold the Company, including its officers,
directors, shareholders and their agents employees and
affiliates, harmless against any and all losses, damages, costs,
charges, counsel fees, payments, expenses and liabilities arising
out of or attributable to:
(1) The acts or omissions of any Custodian, Adviser, Sub-
adviser or other party contracted by or approved by the
Trust or Fund,
(2) The reliance on or use by the Company or its agents or
subcontractors of information, records and documents in
proper form which
(a) are received by the Company or its agents or
subcontractors and furnished to it by or on behalf of
the Fund, its Shareholders or investors regarding the
purchase, redemption or transfer of Shares and
Shareholder account information;
(b) are received by the Company from independent pricing
services or sources for use in valuing the assets of
the Funds; or
(c) are received by the Company or its agents or
subcontractors from Advisers, Sub-advisers or other
third parties contracted by or approved by the Trust
of Fund for use in the performance of services under
this Agreement;
(d) have been prepared and/or maintained by the Fund or
its affiliates or any other person or firm on behalf
of the Trust.
(3) The reliance on, or the carrying out by the Company or its
agents or subcontractors of Proper Instructions of the
Trust or the Fund.
(4) The offer or sale of Shares in violation of any
requirement under the federal securities laws or
regulations or the securities laws or regulations of any
state that such Shares be registered in such state or in
violation of any stop order or other determination or
ruling by any federal agency or any state with respect to
the offer or sale of such Shares in such state.
Provided, however, that the Company shall not be protected
by this Article 15.A. from liability for any act or
omission resulting from the Company's willful misfeasance,
bad faith, negligence or reckless disregard of its duties
of failure to meet the standard of care set forth in 15.A.
above.
C. Reliance
At any time the Company may apply to any officer of the Trust or
Fund for instructions, and may consult with legal counsel with
respect to any matter arising in connection with the services to
be performed by the Company under this Agreement, and the Company
and its agents or subcontractors shall not be liable and shall be
indemnified by the Trust or the appropriate Fund for any action
reasonably taken or omitted by it in reliance upon such
instructions or upon the opinion of such counsel provided such
action is not in violation of applicable federal or state laws or
regulations. The Company, its agents and subcontractors shall be
protected and indemnified in recognizing stock certificates which
are reasonably believed to bear the proper manual or facsimile
signatures of the officers of the Trust or the Fund, and the
proper countersignature of any former transfer agent or
registrar, or of a co-transfer agent or co-registrar.
D. Notification
In order that the indemnification provisions contained in this
Article 15 shall apply, upon the assertion of a claim for which
either party may be required to indemnify the other, the party
seeking indemnification shall promptly notify the other party of
such assertion, and shall keep the other party advised with
respect to all developments concerning such claim. The party who
may be required to indemnify shall have the option to participate
with the party seeking indemnification in the defense of such
claim. The party seeking indemnification shall in no case confess
any claim or make any compromise in any case in which the other
party may be required to indemnify it except with the other
party's prior written consent.
Article 16. Termination of Agreement.
This Agreement may be terminated by either party upon one hundred
twenty (120) days written notice to the other. Should the Trust exercise
its rights to terminate, all out-of-pocket expenses associated with the
movement of records and materials will be borne by the Trust or the
appropriate Fund. Additionally, the Company reserves the right to charge
for any other reasonable expenses associated with such termination. The
provisions of Article 15 shall survive the termination of this Agreement.
Article 17. Amendment.
This Agreement may be amended or modified by a written agreement
executed by both parties.
Article 18. Interpretive and Additional Provisions.
In connection with the operation of this Agreement, the Company and
the Trust may from time to time agree on such provisions interpretive of
or in addition to the provisions of this Agreement as may in their joint
opinion be consistent with the general tenor of this Agreement. Any such
interpretive or additional provisions shall be in a writing signed by
both parties and shall be annexed hereto, provided that no such
interpretive or additional provisions shall contravene any applicable
federal or state regulations or any provision of the Charter. No
interpretive or additional provisions made as provided in the preceding
sentence shall be deemed to be an amendment of this Agreement.
Article 19. Governing Law.
This Agreement shall be construed and the provisions hereof
interpreted under and in accordance with the laws of the Commonwealth of
Massachusetts
Article 20. Notices.
Except as otherwise specifically provided herein, Notices and other
writings delivered or mailed postage prepaid to the Trust at Federated
Investors Tower, Pittsburgh, Pennsylvania, 15222-3779, or to the Company
at Federated Investors Tower, Pittsburgh, Pennsylvania, 15222-3779, or to
such other address as the Trust or the Company may hereafter specify,
shall be deemed to have been properly delivered or given hereunder to the
respective address.
Article 21. Counterparts.
This Agreement may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original.
Article 22. Limitations of Liability of Trustees and Shareholders of
the Trust.
The execution and delivery of this Agreement have been authorized by
the Trustees of the Trust and signed by an authorized officer of the
Trust, acting as such, and neither such authorization by such Trustees
nor such execution and delivery by such officer shall be deemed to have
been made by any of them individually or to impose any liability on any
of them personally, and the obligations of this Agreement are not binding
upon any of the Trustees or Shareholders of the Trust, but bind only the
appropriate property of the Fund, or Class, as provided in the
Declaration of Trust.
Article 23. Limitations of Liability of Trustees and Shareholders of
the Company.
The execution and delivery of this Agreement have been authorized by
the Trustees of the Company and signed by an authorized officer of the
Company, acting as such, and neither such authorization by such Trustees
nor such execution and delivery by such officer shall be deemed to have
been made by any of them individually or to impose any liability on any
of them personally, and the obligations of this Agreement are not binding
upon any of the Trustees or Shareholders of the Company, but bind only
the property of the Company as provided in the Declaration of Trust.
Article 24. Assignment.
This Agreement and the rights and duties hereunder shall not be
assignable with respect to the Trust or the Funds by either of the
parties hereto except by the specific written consent of the other party.
Article 25. Merger of Agreement.
This Agreement constitutes the entire agreement between the parties
hereto and supersedes any prior agreement with respect to the subject
hereof whether oral or written.
Article 26. Successor Agent.
If a successor agent for the Trust shall be appointed by the Trust,
the Company shall upon termination of this Agreement deliver to such
successor agent at the office of the Company all properties of the Trust
held by it hereunder. If no such successor agent shall be appointed, the
Company shall at its office upon receipt of Proper Instructions deliver
such properties in accordance with such instructions.
In the event that no written order designating a successor agent or
Proper Instructions shall have been delivered to the Company on or before
the date when such termination shall become effective, then the Company
shall have the right to deliver to a bank or trust company, which is a
"bank" as defined in the 1940 Act, of its own selection, having an
aggregate capital, surplus, and undivided profits, as shown by its last
published report, of not less than $2,000,000, all properties held by the
Company under this Agreement. Thereafter, such bank or trust company
shall be the successor of the Company under this Agreement.
Article 27. Force Majeure.
The Company shall have no liability for cessation of services
hereunder or any damages resulting therefrom to the Fund as a result of
work stoppage, power or other mechanical failure, natural disaster,
governmental action, communication disruption or other impossibility of
performance.
Article 28. Assignment; Successors.
This Agreement shall not be assigned by either party without the prior
written consent of the other party, except that either party may assign
to a successor all of or a substantial portion of its business, or to a
party controlling, controlled by, or under common control with such
party. Nothing in this Article 28 shall prevent the Company from
delegating its responsibilities to another entity to the extent provided
herein.
Article 29. Severability.
In the event any provision of this Agreement is held illegal, void or
unenforceable, the balance shall remain in effect.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed in their names and on their behalf under their seals by and
through their duly authorized officers, as of the day and year first
above written.
ATTEST: INVESTMENT COMPANIES
(listed on Exhibit 1)
/s/ John W. McGonigle_______ By:__/s/ John F. Donahue___
John W. McGonigle John F. Donahue
Secretary Chairman
ATTEST: FEDERATED SERVICES COMPANY
/s/ Jeannette Fisher-Garber By:_/s/ James J. Dolan_____
Jeannette Fisher-Garber James J. Dolan
Secretary President
EXHIBIT 1
<TABLE>
<S> <C>
CONTRACT
DATE INVESTMENT COMPANY
Portfolios
Classes
12/01/93 FEDERATED EXCHANGE FUND, LTD.
FEDERATED SERVICES COMPANY provides the following services:
Fund Accounting
Shareholder Recordkeeping
Custody Services Procurement
</TABLE>
<TABLE> <S> <C>
<S> <C>
<ARTICLE> 6
<SERIES>
<NUMBER> 1
<NAME> FEDERATED EXCHANGE FUND, LTD.
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> Dec-31-1994
<PERIOD-END> Dec-31-1994
<INVESTMENTS-AT-COST> 67,643,476
<INVESTMENTS-AT-VALUE> 82,429,212
<RECEIVABLES> 212,253
<ASSETS-OTHER> 4,220
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 82,645,685
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 1,268,668
<TOTAL-LIABILITIES> 1,268,668
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 81,377,017
<SHARES-COMMON-STOCK> 1,182,060
<SHARES-COMMON-PRIOR> 1,245,908
<ACCUMULATED-NII-CURRENT> 53,355
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 66,537,926
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 14,785,736
<NET-ASSETS> 81,377,017
<DIVIDEND-INCOME> 2,283,896
<INTEREST-INCOME> 123,403
<OTHER-INCOME> 0
<EXPENSES-NET> 992,433
<NET-INVESTMENT-INCOME> 1,414,866
<REALIZED-GAINS-CURRENT> 5,307,218
<APPREC-INCREASE-CURRENT> (6,996,355)
<NET-CHANGE-FROM-OPS> (274,271)
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 1,361,721
<DISTRIBUTIONS-OF-GAINS> 1,407,972
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 0
<NUMBER-OF-SHARES-REDEEMED> 74,930
<SHARES-REINVESTED> 11,082
<NET-CHANGE-IN-ASSETS> (63,848)
<ACCUMULATED-NII-PRIOR> 210
<ACCUMULATED-GAINS-PRIOR> 67,166,271
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 585,292
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 992,433
<AVERAGE-NET-ASSETS> 86,445,515
<PER-SHARE-NAV-BEGIN> 71.390
<PER-SHARE-NII> 1.180
<PER-SHARE-GAIN-APPREC> (1.390)
<PER-SHARE-DIVIDEND> 1.140
<PER-SHARE-DISTRIBUTIONS> 1.200
<RETURNS-OF-CAPITAL> 0.000
<PER-SHARE-NAV-END> 68.840
<EXPENSE-RATIO> 115
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0.000
</TABLE>
