Filed electronically with the Securities and Exchange Commission on
January 26, 1998
File No. 2-78122
File No. 811-3495
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. 25
------
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940
AMENDMENT No. 21
-----
Scudder Fund, Inc.
--------------------------------------------------
(Exact name of Registrant as Specified in Charter)
345 Park Avenue, New York, NY 10154
--------------------------------------- ---------
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, including Area Code: (617) 295-2567
--------------
Thomas F. McDonough
Two International Place, Boston MA 02110
----------------------------------------
(Name and Address of Agent for Service)
It is proposed that this filing will become effective
X immediately upon filing pursuant to paragraph (b),
----
on ____________ pursuant to paragraph (b),
----
60 days after filing pursuant to paragraph (a)(1),
----
on ___________ pursuant to paragraph (a)(1)
----
75 days after filing pursuant to paragraph (a)(2)
----
on __________ pursuant to paragraph (a)(2) of Rule 485.
----
<PAGE>
SCUDDER FUND, INC.
SCUDDER MONEY MARKET SERIES
SCUDDER PREMIUM MONEY MARKET SHARES
CROSS-REFERENCE SHEET
Items Required By Form N-1A
PART A
Item No. Item Caption Prospectus Caption
-------- ------------ ------------------
1. Cover Page COVER PAGE
2. Synopsis EXPENSE INFORMATION
3. Condensed Financial FINANCIAL HIGHLIGHTS
Information DISTRIBUTION AND PERFORMANCE INFORMATION
4. General Description INVESTMENT OBJECTIVE AND POLICIES
of Registrant WHY INVEST IN SCUDDER PREMIUM MONEY MARKET
SHARES OF THE FUND?
ADDITIONAL INFORMATION ABOUT POLICIES AND
INVESTMENTS
FUND ORGANIZATION
5. Management of the FINANCIAL HIGHLIGHTS
Fund A MESSAGE FROM SCUDDER'S CHAIRMAN
FUND ORGANIZATION--Investment adviser,
Transfer agent
SHAREHOLDER BENEFITS--A team approach to
investing
DIRECTORS AND OFFICERS
5A. Management's NOT APPLICABLE
Discussion of Fund
Performance
6. Capital Stock and DISTRIBUTION AND PERFORMANCE
Other Securities INFORMATION--Dividends and capital gains
distributions
FUND ORGANIZATION
TRANSACTION INFORMATION
SHAREHOLDER BENEFITS--SAIL(TM)--Scudder
Automated Information Line, Dividend
reinvestment plan, T.D.D. service for
the hearing impaired
HOW TO CONTACT SCUDDER
7. Purchase of PURCHASES
Securities Being FUND ORGANIZATION--Underwriter
Offered TRANSACTION INFORMATION--Purchasing shares,
Share price, Processing time, Minimum
balances, Third party transactions
SHAREHOLDER BENEFITS--Dividend reinvestment
plan
SCUDDER TAX-ADVANTAGED RETIREMENT PLANS
INVESTMENT PRODUCTS AND SERVICES
8. Redemption or EXCHANGES AND REDEMPTIONS
Repurchase TRANSACTION INFORMATION--Redeeming shares,
Tax identification number, Minimum
balances
9. Pending Legal NOT APPLICABLE
Proceedings
1
<PAGE>
SCUDDER PREMIUM MONEY MARKET SHARES
(continued)
PART B
Caption in Statement of
Item No. Item Caption Additional Information
-------- ------------ ----------------------
10. Cover Page COVER PAGE
11. Table of Contents TABLE OF CONTENTS
12. General Information ORGANIZATION OF THE FUNDS
and History
13. Investment Objectives THE FUND'S INVESTMENT OBJECTIVE AND
and Policies POLICIES
PORTFOLIO TRANSACTIONS--Brokerage
Commissions, Portfolio Turnover
14. Management of the Fund INVESTMENT ADVISER
DIRECTORS AND OFFICERS
REMUNERATION
15. Control Persons and DIRECTORS AND OFFICERS
Principal Holders of
Securities
16. Investment Advisory INVESTMENT ADVISER
and Other Services DISTRIBUTOR
ADDITIONAL INFORMATION--Experts, Other
Information
17. Brokerage Allocation PORTFOLIO TRANSACTIONS--Brokerage
and Other Practices Commissions, Portfolio Turnover
18. Capital Stock and ORGANIZATION OF THE FUNDS
Other Securities DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS
19. Purchase, Redemption PURCHASES
and Pricing of EXCHANGES AND REDEMPTIONS
Securities Being FEATURES AND SERVICES OFFERED BY THE
Offered FUND--Dividend and Capital Gain
Distribution Options
SPECIAL PLAN ACCOUNTS
NET ASSET VALUE
20. Tax Status DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS
TAXES
21. Underwriters DISTRIBUTOR
22. Calculation of PERFORMANCE INFORMATION
Performance Data
23. Financial Statements FINANCIAL STATEMENTS
2
<PAGE>
SCUDDER FUND, INC.
SCUDDER MANAGED SHARES
SCUDDER MONEY MARKET SERIES
SCUDDER TAX FREE MONEY MARKET SERIES
SCUDDER GOVERNMENT MONEY MARKET SERIES
CROSS-REFERENCE SHEET
Items Required By Form N-1A
PART A
Item No. Item Caption Prospectus Caption
-------- ------------ ------------------
1. Cover Page COVER PAGE
2. Synopsis EXPENSE INFORMATION
3. Condensed Financial FINANCIAL HIGHLIGHTS
Information DISTRIBUTION AND PERFORMANCE INFORMATION
4. General Description INVESTMENT OBJECTIVE AND POLICIES
of Registrant WHY INVEST IN MANAGED SHARES?
ADDITIONAL INFORMATION ABOUT POLICIES AND
INVESTMENTS
FUND ORGANIZATION
5. Management of the FINANCIAL HIGHLIGHTS
Fund A MESSAGE FROM SCUDDER'S CHAIRMAN
FUND ORGANIZATION--Investment adviser,
Transfer agent
SHAREHOLDER BENEFITS--A team approach to
investing
DIRECTORS AND OFFICERS
5A. Management's NOT APPLICABLE
Discussion of Fund
Performance
6. Capital Stock and DISTRIBUTION AND PERFORMANCE
Other Securities INFORMATION--Dividends and capital gains
distributions
FUND ORGANIZATION
TRANSACTION INFORMATION
SHAREHOLDER BENEFITS--SAIL(TM)--Scudder
Automated Information Line, Dividend
reinvestment plan
HOW TO CONTACT SCUDDER
7. Purchase of PURCHASES
Securities Being FUND ORGANIZATION--Underwriter
Offered TRANSACTION INFORMATION--Purchasing shares,
Share price, Processing time, Minimum
balances, Third party transactions
SHAREHOLDER BENEFITS--Dividend reinvestment
plan
SCUDDER TAX-ADVANTAGED RETIREMENT PLANS
INVESTMENT PRODUCTS AND SERVICES
8. Redemption or EXCHANGES AND REDEMPTIONS
Repurchase TRANSACTION INFORMATION--Redeeming shares,
Tax identification number, Minimum
balances
9. Pending Legal NOT APPLICABLE
Proceedings
3
<PAGE>
SCUDDER MANAGED SHARES
(continued)
PART B
Caption in Statement of
Item No. Item Caption Additional Information
-------- ------------ ----------------------
10. Cover Page COVER PAGE
11. Table of Contents TABLE OF CONTENTS
12. General Information ORGANIZATION OF THE FUNDS
and History
13. Investment Objectives THE FUND'S INVESTMENT OBJECTIVE AND
and Policies POLICIES
PORTFOLIO TRANSACTIONS--Brokerage
Commissions, Portfolio Turnover
14. Management of the Fund INVESTMENT ADVISER
DIRECTORS AND OFFICERS
REMUNERATION
15. Control Persons and DIRECTORS AND OFFICERS
Principal Holders of
Securities
16. Investment Advisory INVESTMENT ADVISER
and Other Services DISTRIBUTOR
ADDITIONAL INFORMATION--Experts, Other
Information
17. Brokerage Allocation PORTFOLIO TRANSACTIONS--Brokerage
and Other Practices Commissions, Portfolio Turnover
18. Capital Stock and ORGANIZATION OF THE FUNDS
Other Securities DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS
19. Purchase, Redemption PURCHASES
and Pricing of EXCHANGES AND REDEMPTIONS
Securities Being FEATURES AND SERVICES OFFERED BY THE
Offered FUND--Dividend and Capital Gain
Distribution Options
SPECIAL PLAN ACCOUNTS
NET ASSET VALUE
20. Tax Status DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS
TAXES
21. Underwriters DISTRIBUTOR
22. Calculation of PERFORMANCE INFORMATION
Performance Data
23. Financial Statements FINANCIAL STATEMENTS
4
<PAGE>
SCUDDER FUND, INC.
SCUDDER INSTITUTIONAL SHARES
SCUDDER MONEY MARKET SERIES
SCUDDER TAX FREE MONEY MARKET SERIES
SCUDDER GOVERNMENT MONEY MARKET SERIES
CROSS-REFERENCE SHEET
Items Required By Form N-1A
PART A
Item No. Item Caption Prospectus Caption
-------- ------------ ------------------
1. Cover Page COVER PAGE
2. Synopsis EXPENSE INFORMATION
3. Condensed Financial FINANCIAL HIGHLIGHTS
Information DISTRIBUTION AND PERFORMANCE INFORMATION
4. General Description INVESTMENT OBJECTIVE AND POLICIES
of Registrant WHY INVEST IN INSTITUTIONAL SHARES?
ADDITIONAL INFORMATION ABOUT POLICIES AND
INVESTMENTS
FUND ORGANIZATION
5. Management of the FINANCIAL HIGHLIGHTS
Fund A MESSAGE FROM SCUDDER'S CHAIRMAN
FUND ORGANIZATION--Investment adviser,
Transfer agent
SHAREHOLDER BENEFITS--A team approach to
investing
DIRECTORS AND OFFICERS
5A. Management's NOT APPLICABLE
Discussion of Fund
Performance
6. Capital Stock and DISTRIBUTION AND PERFORMANCE
Other Securities INFORMATION--Dividends and capital gains
distributions
FUND ORGANIZATION
TRANSACTION INFORMATION
SHAREHOLDER BENEFITS--Dividend reinvestment
plan
HOW TO CONTACT SCUDDER
7. Purchase of PURCHASES AND REDEMPTIONS
Securities Being FUND ORGANIZATION--Underwriter
Offered TRANSACTION INFORMATION--Purchasing shares,
Share price, Minimum balances, Third
party transactions
SHAREHOLDER BENEFITS--Dividend reinvestment
plan
8. Redemption or PURCHASES AND REDEMPTIONS
Repurchase TRANSACTION INFORMATION--Redeeming shares,
Tax identification number, Minimum
balances
9. Pending Legal NOT APPLICABLE
Proceedings
5
<PAGE>
SCUDDER INSTITUTIONAL SHARES
(continued)
PART B
Caption in Statement of
Item No. Item Caption Additional Information
-------- ------------ ----------------------
10. Cover Page COVER PAGE
11. Table of Contents TABLE OF CONTENTS
12. General Information ORGANIZATION OF THE FUNDS
and History
13. Investment Objectives THE FUND'S INVESTMENT OBJECTIVE AND
and Policies POLICIES
PORTFOLIO TRANSACTIONS--Brokerage
Commissions, Portfolio Turnover
14. Management of the Fund INVESTMENT ADVISER
DIRECTORS AND OFFICERS
REMUNERATION
15. Control Persons and DIRECTORS AND OFFICERS
Principal Holders of
Securities
16. Investment Advisory INVESTMENT ADVISER
and Other Services DISTRIBUTOR
ADDITIONAL INFORMATION--Experts, Other
Information
17. Brokerage Allocation PORTFOLIO TRANSACTIONS--Brokerage
and Other Practices Commissions, Portfolio Turnover
18. Capital Stock and ORGANIZATION OF THE FUNDS
Other Securities DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS
19. Purchase, Redemption PURCHASES
and Pricing of EXCHANGES AND REDEMPTIONS
Securities Being FEATURES AND SERVICES OFFERED BY THE
Offered FUND--Dividend and Capital Gain
Distribution Options
SPECIAL PLAN ACCOUNTS
NET ASSET VALUE
20. Tax Status DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS
TAXES
21. Underwriters DISTRIBUTOR
22. Calculation of PERFORMANCE INFORMATION
Performance Data
23. Financial Statements FINANCIAL STATEMENTS
6
<PAGE>
Part A
Part A of this Post-Effective Amendment No. 25 to the Registration Statement is
incorporated by reference in its entirety to the Scudder Fund, Inc.'s current
Post-Effective Amendment No. 24 on Form N-1A filed on July 7, 1997 and to its
definitive Rule 497(c) filing on July 16, 1997.
<PAGE>
Part B
Part B of this Post-Effective Amendment No. 25 to the Registration Statement is
incorporated by reference in its entirety to the Scudder Fund, Inc.'s current
Post-Effective Amendment No. 24 on Form N-1A filed on July 7, 1997 and to its
definitive Rule 497(c) filing on July 16, 1997.
<PAGE>
PART C. - OTHER INFORMATION
Item 24. Financial Statements and Exhibits
a. Financial Statements
Included in Part A of this Registration Statement for the
Managed Shares
For Scudder Money Market Series
For Scudder Tax Free Money Market Series
For Scudder Government Money Market Series
Financial Highlights for the ten fiscal years ended
December 31, 1996 (Incorporated by reference to
Post-Effective Amendment No. 24 to this Registration
Statement.)
Included in Part B of this Registration Statement
For Scudder Money Market Series
For Scudder Tax Free Money Market Series
For Scudder Government Money Market Series
Statement of Net Assets as of December 31, 1996
Statement of Operations for the fiscal year ended
December 31, 1996
Statements of Changes in Net Assets for the two fiscal
years ended December 31, 1995 and 1996
Financial Highlights for the five fiscal years ended
December 31, 1996
Notes to Financial Statements
Report of Independent Accountants (Incorporated by
reference to Post-Effective Amendment No. 24 to this
Registration Statement.)
b. Exhibits
1. (a) Articles of Incorporation dated June 16, 1982.
(Incorporated by reference to Post-Effective
Amendment No. 21 to this Registration
Statement.)
(b) Articles Supplementary dated April 28, 1987 are
filed herein.
(c) Articles of Merger dated April 28, 1987 are
filed herein.
(d) Articles Supplementary dated February 20, 1991
are filed herein.
(e) Articles of Transfer dated December 27, 1991
are filed herein.
(f) Articles Supplementary dated February 7, 1992
are filed herein.
(g) Articles of Amendment dated October 14, 1992
are filed herein.
(h) Articles Supplementary for Managed Intermediate
Government Fund dated January 18, 1993, are
filed herein.
Part C - Page 1
<PAGE>
(i) Articles Supplementary dated April 24, 1995 are
filed herein.
(j) Articles Supplementary dated January 25, 1996.
(Incorporated by reference to Exhibit 1(h) to
Post-Effective Amendment No. 21 to this
Registration Statement.)
(k) Articles of Amendment dated June 12, 1997.
(Incorporated by reference to Exhibit 1(i) to
Post-Effective Amendment No. 24 to this
Registration Statement.)
(l) Articles Supplementary dated June 12, 1997.
(Incorporated by reference to Exhibit 1(j) to
Post-Effective Amendment No. 24 to this
Registration Statement.)
2. (a) By-laws as amended through October 24, 1991 are
filed herein.
(b) By-laws as amended through July 20, 1995.
(Incorporated by reference to Post-Effective
Amendment No. 21 to this Registration
Statement.)
(c) By-laws as amended through October 24, 1996.
(Incorporated by reference to Post-Effective
Amendment No. 22 to this Registration
Statement.)
3. Not applicable.
4. Form of stock certificate.
(Incorporated by reference to Exhibit 4 to
Pre-Effective Amendment No. 1 to this
Registration Statement filed September 28, 1982
and to Post-Effective Amendment No. 7 to this
Registration Statement filed March 3, 1988.)
5. (a)(1) Investment Advisory Agreement on behalf of
Managed Government Securities Fund dated May 1,
1989 is filed herein.
(a)(2) Investment Advisory Agreement on behalf of
Managed Cash Fund dated May 1, 1989 is filed
herein.
(a)(3) Investment Advisory Agreement on behalf of
Managed Tax-Free Fund dated May 1, 1989 is
filed herein.
(a)(4) Form of Investment Advisory Agreement on behalf
of Managed Federal Securities Fund dated May 1,
1991 is filed herein.
(a)(5) Investment Advisory Agreement on behalf of
Managed Intermediate Government Fund dated
January 18, 1993 is filed herein.
(a)(6) Investment Advisory Agreement on behalf of
Scudder Money Market Series (Formerly Known As
Managed Cash Fund) dated July 7, 1997.
(Incorporated by reference to Exhibit 5(a)(ix)
to Post-Effective Amendment No. 24 to this
Registration Statement.)
(a)(7) Investment Advisory Agreement on behalf of
Scudder Tax Free Money Market Series (Formerly
Known As Managed Tax Free Fund) dated July 7,
1997.
(Incorporated by reference to Exhibit 5(a)(x)
to Post-Effective Amendment No. 24 to this
Registration Statement.)
Part C - Page 2
<PAGE>
(a)(8) Investment Advisory Agreement on behalf of
Scudder Government Money Market Series
(Formerly Known As Managed Government
Securities Fund) dated July 7, 1997.
(Incorporated by reference to Exhibit 5(a)(xi)
to Post-Effective Amendment No. 24 to this
Registration Statement.)
6. (a) Underwriting Agreement dated January 18, 1989
(with form of Dealer Contract Exhibit) is filed
herein.
(b) Underwriting Agreement dated July 7, 1997
between the Registrant and Scudder Investor
Services.
(Incorporated by reference to Exhibit 6(c) to
Post-Effective Amendment No. 24 to this
Registration Statement.)
7. Not Applicable.
8. (a) Form of Custodian Agreement is filed
herein.
(b) Transfer Agency Agreement dated January 1, 1990
is filed herein.
(b)(1) Fee schedule for Exhibit 8(b).
(Incorporated by reference to Post-Effective
Amendment No. 21 to this Registration
Statement.)
(b)(2) Scudder Service Corporation Fee Information for
Services Provided under Transfer Agency and
Service Agreement dated July 7, 1997.
(Incorporated by reference to Post-Effective
Amendment No. 24 to this Registration
Statement.)
(c)(1) Custodian Agreement with State Street London
Limited dated November 13, 1985 is filed
herein.
(c)(2) Sub-Custodian Arrangement with Bankers Trust
(August 1986) is filed herein.
(c)(3) Sub-Custodian Agreement with Bankers Trust
Company (August 15, 1989) is filed herein.
(c)(4) Sub-Custodian Agreement with Irving Trust
Company as amended February 6, 1990 is filed
herein.
(c)(5) Fee Schedule for Exhibit 8(a).
(Incorporated by reference to Exhibit 8(c)(v)
to Post-Effective Amendment No. 20 filed on
April 28, 1995.)
9. (b)(1) Fund Accounting Services Agreement between the
Registrant, on behalf of Managed Cash Fund, and
Scudder Fund Accounting Corporation dated
August 1, 1994.
(Incorporated by reference to Post-Effective
Amendment No. 20 filed on April 28, 1995.)
Part C - Page 3
<PAGE>
(b)(2) Fund Accounting Services Agreement between the
Registrant, on behalf of Managed Federal
Securities Fund, and Scudder Fund Accounting
Corporation dated August 1, 1994
(Incorporated by reference to Post-Effective
Amendment No. 20 filed on April 28, 1995.)
(b)(3) Fund Accounting Services Agreement between the
Registrant, on behalf of Managed Government
Securities Fund, and Scudder Fund Accounting
Corporation dated August 1, 1994.
(Incorporated by reference to Post-Effective
Amendment No. 20 filed on April 28, 1995.)
(b)(4) Fund Accounting Services Agreement between the
Registrant, on behalf of Managed Tax-Free Fund,
and Scudder Fund Accounting Corporation dated
August 18, 1994.
(Incorporated by reference to Post-Effective
Amendment No. 20 filed on April 28, 1995.)
(b)(5) Fund Accounting Services Agreement between the
Registrant, on behalf of Managed Intermediate
Government Fund, and Scudder Fund Accounting
Corporation dated September 22, 1994.
(Incorporated by reference to Post-Amendment
No. 20 filed on April 28, 1995.)
(b)(6) Fund Accounting Fee Schedule between the
Registrant and Scudder Fund Accounting Corp.
dated July 7, 1997.
(Incorporated by reference to Post-Effective
Amendment No. 24 to this Registration
Statement).
10. Inapplicable.
11. Inapplicable.
12. Inapplicable.
13. Inapplicable
14. (a) Individual Retirement Account Prototype is
filed herein.
(b) Self-Employed Individuals Retirement Plan
Prototype is filed herein.
15. Inapplicable.
16. (a) Schedules for Computations of Performance
Quotations are filed herein.
(b) Schedules for Computations of Performance
Quotations.
(Incorporated by reference to Exhibit 16(c) to
Post-Effective Amendment No. 20 to this
Registration Statement filed on April 28,
1995.)
17. Financial Data Schedules to be filed by
amendment.
18. Plan pursuant to Rule 18f-3.
Power of attorney for Dr. Rosita Chang, Dr. J.D. Hammond, Richard M. Hunt, Edgar
R. Fiedler, Daniel Pierce and Peter B. Freeman are filed herein.
Part C - Page 4
<PAGE>
Item 25. Persons Controlled by or under Common Control with Registrant.
No person is controlled by or under common control with the
Registrant.
Item 26. Number of Holders of Securities.
Set forth below is a table showing the number of record holders of
each class of securities of Scudder Fund, Inc. as of December 15,
1997.
<TABLE>
<CAPTION>
(1) (2)
Title of Class Number of Record Shareholders
-------------- -----------------------------
<S> <C>
Scudder Money Market Series:
Premium Money Market Shares 2883
Managed Money Market Shares 1540
Institutional Money Market Shares 42
Scudder Tax Free Money Market Series:
Tax Free Managed Shares 152
Tax Free Institutional Shares 11
Scudder Government Money Market Series:
Government Managed Shares 267
Government Institutional Shares 7
</TABLE>
Item 27. Indemnification.
As permitted by Sections 17(h) and 17(i) of the Investment Company
Act of 1940, as amended (the "1940 Act"), pursuant to Article IV of
the Registrant's By-Laws (filed as Exhibit No. 2 to the Registration
Statement), officers, directors, employees and representatives of
the Funds may be indemnified against certain liabilities in
connection with the Funds, and pursuant to Section 12 of the
Underwriting Agreement dated January 18, 1989 (filed as Exhibit No.
6(b) to the Registration Statement), Scudder Investor Services, Inc.
(formerly "Scudder Fund Distributors, Inc."), as principal
underwriter of the Registrant, may be indemnified against certain
liabilities that it may incur. Said Article IV of the By-Laws and
Section 12 of the Underwriting Agreement are hereby incorporated by
reference in their entirety.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933, as amended (the "Act"), may be permitted to
directors, officers and controlling persons of the Registrant and
the principal underwriter pursuant to the foregoing provisions or
otherwise, the Registrant has been advised that in the opinion of
the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Act and is, therefore,
unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of
expenses incurred or paid by a director, officer, or controlling
person of the Registrant and the principal underwriter in connection
with the successful defense of any action, suit or proceeding) is
asserted against the Registrant by such director, officer or
controlling person or the principal underwriter in connection with
the shares being registered, the Registrant will, unless in the
opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy
as expressed in the Act and will be governed by the final
adjudication of such issue.
Item 28. Business or Other Connections of Investment Adviser
Scudder Kemper Investments, Inc. has stockholders and employees who
are denominated officers but do not as such have corporation-wide
responsibilities. Such persons are not considered officers for the
purpose of this Item 28.
Part C - Page 5
<PAGE>
Business and Other Connections of Board
Name of Directors of Registrant's Adviser
---- ------------------------------------
Stephen R. Treasurer and Chief Financial Officer, Scudder Kemper
Beckwith Investments, Inc.**
Vice President and Treasurer, Scudder Fund Accounting
Corporation*
Director, Scudder Stevens & Clark Corporation**
Director and Chairman, Scudder Defined Contribution
Services, Inc.**
Director and President, Scudder Capital Asset Corporation**
Director and President, Scudder Capital Stock Corporation**
Director and President, Scudder Capital Planning
Corporation**
Director and President, SS&C Investment Corporation** Director
and President, SIS Investment Corporation** Director and
President, SRV Investment Corporation**
Lynn S. Birdsong Director and Vice President, Scudder Kemper Investments,
Inc.**
Director, Scudder, Stevens & Clark (Luxembourg) S.A.#
Laurence W. Director, Scudder Kemper Investments, Inc.**
Cheng Member, Corporate Executive Board, Zurich Insurance Company
of Switzerland##
Director, ZKI Holding Corporation xx
Steven Director, Scudder Kemper Investments, Inc.**
Gluckstern Member, Corporate Executive Board, Zurich Insurance Company
of Switzerland##
Director, Zurich Holding Company of Americao
Rolf Huppi Director, Chairman of the Board, Scudder Kemper
Investments, Inc.**
Member, Corporate Executive Board, Zurich Insurance Company
of Switzerland##
Director, Chairman of the Board, Zurich Holding Company of
Americao
Director, ZKI Holding Corporation xx
Kathryn L. Quirk Director, Chief Legal Officer, Chief Compliance Officer and
Secretary, Scudder Kemper Investments, Inc.**
Director, Senior Vice President & Assistant Clerk, Scudder
Investor Services, Inc.*
Director, Vice President & Secretary, Scudder Fund
Accounting Corporation*
Director, Vice President & Secretary, Scudder Realty
Holdings Corporation*
Director & Assistant Clerk, Scudder Service Corporation*
Director, SFA, Inc.*
Vice President, Director & Assistant Secretary, Scudder
Precious Metals, Inc.***
Director, Scudder, Stevens & Clark Japan, Inc.***
Director, Vice President and Secretary, Scudder, Stevens &
Clark of Canada, Ltd.***
Director, Vice President and Secretary, Scudder Canada
Investor Services Limited***
Director, Vice President and Secretary, Scudder Realty
Advisers, Inc. x
Director and Secretary, Scudder, Stevens & Clark
Corporation**
Director and Secretary, Scudder, Stevens & Clark Overseas
Corporationoo
Director and Secretary, SFA, Inc.*
Director, Vice President and Secretary, Scudder Defined
Contribution Services, Inc.**
Director, Vice President and Secretary, Scudder Capital
Asset Corporation**
Director, Vice President and Secretary, Scudder Capital
Stock Corporation**
Director, Vice President and Secretary, Scudder Capital
Planning Corporation**
Director, Vice President and Secretary, SS&C Investment
Corporation**
Director, Vice President and Secretary, SIS Investment
Corporation**
Director, Vice President and Secretary, SRV Investment
Corporation**
Director, Vice President and Secretary, Scudder Brokerage
Services, Inc.*
Director, Korea Bond Fund Management Co., Ltd.+
Part C - Page 6
<PAGE>
Markus Director, Scudder Kemper Investments, Inc.**
Rohrbasser Member Corporate Executive Board, Zurich Insurance Company
of Switzerland##
President, Director, Chairman of the Board, ZKI Holding
Corporation xx
Cornelia M. Vice President, Scudder Kemper Investments, Inc.**
Small
Edmond D. Director, President and Chief Executive Officer, Scudder
Villani Kemper Investments, Inc.**
Director, Scudder, Stevens & Clark Japan, Inc.###
President and Director, Scudder, Stevens & Clark Overseas
Corporationoo
President and Director, Scudder, Stevens & Clark
Corporation**
Director, Scudder Realty Advisors, Inc.x
Director, IBJ Global Investment Management S.A. Luxembourg,
Grand-Duchy of Luxembourg
* Two International Place, Boston, MA
x 333 South Hope Street, Los Angeles, CA
** 345 Park Avenue, New York, NY
# Societe Anonyme, 47, Boulevard Royal, L-2449 Luxembourg, R.C.
Luxembourg B 34.564
*** Toronto, Ontario, Canada
xxx Grand Cayman, Cayman Islands, British West Indies
oo 20-5, Ichibancho, Chiyoda-ku, Tokyo, Japan
### 1-7, Kojimachi, Chiyoda-ku, Tokyo, Japan
xx 222 S. Riverside, Chicago, IL
o Zurich Towers, 1400 American Ln., Schaumburg, IL
+ P.O. Box 309, Upland House, S. Church St., Grand Cayman,
British West Indies
## Mythenquai-2, P.O. Box CH-8022, Zurich, Switzerland
Item 29. Principal Underwriters.
(a)
Scudder Investor Services, Inc. acts as principal underwriter of the
Registrant's shares and also acts as principal underwriter for other funds
managed by Scudder Kemper Investments, Inc.
(b)
The Underwriter has employees who are denominated officers of an
operational area. Such persons do not have corporation-wide
responsibilities and are not considered officers for the purpose of this
Item 29.
<TABLE>
<CAPTION>
(1) (2) (3)
Name and Principal Position and Offices with Positions and
Business Address Scudder Investor Services, Inc. Offices with Registrant
---------------- ------------------------------- -----------------------
<S> <C> <C>
William S. Baughman Vice President None
Two International Place
Boston, MA 02110
Lynn S. Birdsong Senior Vice President None
345 Park Avenue
New York, NY 10154
</TABLE>
Part C - Page 8
<PAGE>
<TABLE>
<CAPTION>
Name and Principal Position and Offices with Positions and
Business Address Scudder Investor Services, Inc. Offices with Registrant
---------------- ------------------------------- -----------------------
<S> <C> <C>
Mary Elizabeth Beams Vice President None
Two International Place
Boston, MA 02110
Mark S. Casady Director, President and None
Two International Place Assistant Treasurer
Boston, MA 02110
Linda Coughlin Director and Senior Vice None
Two International Place President
Boston, MA 02110
Richard W. Desmond Vice President None
345 Park Avenue
New York, NY 10154
Paul J. Elmlinger Senior Vice President and None
345 Park Avenue Assistant Clerk
New York, NY 10154
Philip S. Fortuna Vice President None
101 California Street
San Francisco, CA 94111
William F. Glavin Vice President None
Two International Place
Boston, MA 02110
Margaret D. Hadzima Assistant Treasurer None
Two International Place
Boston, MA 02110
Thomas W. Joseph Director, Vice President, Vice President and
Two International Place Treasurer and Assistant Clerk Assistant Secretary
Boston, MA 02110
Thomas F. McDonough Clerk Vice President and
Two International Place Secretary
Boston, MA 02110
Daniel Pierce Director, Vice President President
Two International Place and Assistant Treasurer
Boston, MA 02110
Kathryn L. Quirk Director, Senior Vice President Vice President
345 Park Avenue and Assistant Clerk
New York, NY 10154
</TABLE>
Part C - Page 9
<PAGE>
<TABLE>
<CAPTION>
Name and Principal Position and Offices with Positions and
Business Address Scudder Investor Services, Inc. Offices with Registrant
---------------- ------------------------------- -----------------------
<S> <C> <C>
Robert A. Rudell Vice President None
Two International Place
Boston, MA 02110
William M. Thomas Vice President None
Two International Place
Boston, MA 02110
Benjamin Thorndike Vice President None
Two International Place
Boston, MA 02110
Sydney S. Tucker Vice President None
Two International Place
Boston, MA 02110
Linda J. Wondrack Vice President None
Two International Place
Boston, MA 02110
</TABLE>
(c)
<TABLE>
<CAPTION>
(1) (2) (3) (4) (5)
Net
Underwriting Compensation on
Name of Principal Discounts and Redemptions Brokerage Other
Underwriter Commissions and Repurchases Commissions Compensation
----------- ----------- --------------- ----------- ------------
<S> <C> <C> <C> <C>
Scudder Investor None None None None
Services, Inc.
</TABLE>
The Underwriter has employees who are denominated officers of an
operational area. Such persons do not have corporation-wide
responsibilities and are not considered officers for the purpose of this
Item 29.
(c)
<TABLE>
<CAPTION>
(1) (2) (3) (4) (5)
Net
Underwriting Compensation on
Name of Principal Discounts and Redemptions Brokerage Other
Underwriter Commissions and Repurchases Commissions Compensation
----------- ----------- --------------- ----------- ------------
<S> <C> <C> <C> <C>
Scudder Investor None None None None
Services, Inc.
</TABLE>
Item 30. Location of Accounts and Records.
Certain accounts, books and other documents required to be
maintained by Section 31(a) of the 1940 Act and the Rules thereunder
are maintained at the offices of the Custodian, the Transfer Agent,
the Distributor or the Registrant. Documents required by paragraphs
(b)(4), (5), (6), (7), (9), (10), and (11) and (f) of Rule 31a-1
(the "Rule"), will be kept at the offices of the Registrant, 345
Park Avenue, New York, New York; certain documents required to be
kept under paragraphs (b)(1) and (b)(2)(iv) of the Rule will be kept
at the offices of Scudder Service Corporation, Two International
Place, Boston, Massachusetts 02110-4103; documents required to be
kept under paragraph (d) of the Rule will be kept at the offices of
Scudder Investor Services, Inc., Two International Place, Boston,
Massachusetts
Part C - Page 9
<PAGE>
02110-4103; and the remaining accounts, books and other documents
required by the Rule will be kept at State Street Bank and Trust
Company, 1776 Heritage Drive, North Quincy, Massachusetts 02171.
Item 31. Management Services.
Inapplicable.
Item 32. Undertakings.
Inapplicable.
Part C - Page 9
<PAGE>
File No. 2-78122
File No. 811-3495
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
EXHIBITS
TO
FORM N-1A
POST-EFFECTIVE AMENDMENT NO. 25
TO REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
AND
AMENDMENT NO. 21
TO REGISTRATION STATEMENT
UNDER
THE INVESTMENT COMPANY ACT OF 1940
SCUDDER FUND, INC.
<PAGE>
SCUDDER FUND, INC.
EXHIBIT INDEX
Exhibit 1(b)
Exhibit 1(c)
Exhibit 1(d)
Exhibit 1(e)
Exhibit 1(f)
Exhibit 1(g)
Exhibit 1(h)
Exhibit 1(i)
Exhibit 2(a)
Exhibit 5(a)(1)
Exhibit 5(a)(2)
Exhibit 5(a)(3)
Exhibit 5(a)(4)
Exhibit 5(a)(5)
Exhibit 6(a)
Exhibit 8(a)
Exhibit 8(b)
Exhibit 8(c)(1)
Exhibit 8(c)(2)
Exhibit 8(c)(3)
Exhibit 8(c)(4)
Exhibit 14(a)
Exhibit 14(b)
Exhibit 16(b)
Exhibit 18
EXHIBIT 1(b)
<PAGE>
LAZARD TAX-FREE RESERVES, INC.
ARTICLES SUPPLEMENTARY TO THE
ARTICLES OF INCORPORATION
LAZARD TAX-FREE RESERVES, INC., a Maryland corporation having its
principal office in New York, New York (the "Corporation"), hereby certifies to
the State Department of Assessments and Taxation of Maryland that:
FIRST: The Board of Directors of the Corporation at a meeting duly
convened and held on January 27, 1987, adopted a resolution classifying
3,000,000,000 unissued and unclassified shares, par value $.00l per share, of
the Capital Stock of the Corporation into a class designated "Lazard Cash
Management Fund" and classifying 3,000,000,000 unissued and unclassified shares,
par value $.00l per share, of the Capital Stock of the Corporation into a class
designated "Lazard Government Fund", in each case by setting before the issuance
of such shares, the preferences, conversion and other rights, voting powers,
restrictions, limitations as to dividends, qualifications and terms and
conditions of redemption thereof as hereinafter set forth.
SECOND: The Board of Directors of the Corporation at a meeting duly
convened and held on February 24, 1987 adopted a resolution classifying an
aggregate of 400,000,000 unissued and unclassified shares, par value $.001 per
share, of the Capital Stock of the Corporation as follows:
<PAGE>
100,000,000 into a class designated "Lazard Tax-Free Bond Fund"; 100,000,000
into a class designated "Lazard New York Tax-Free Bond Fund"; 100,000,000 into a
class designated "Lazard Bond Fund"; and 100,000,000 into a class designated
"Lazard Equity Fund", in each case by setting before the issuance of such
shares, the preferences, conversion and other rights, voting powers,
restrictions, limitations as to dividends, qualifications and terms and
conditions of redemption thereof as hereinafter set forth.
THIRD: A description of the shares so classified, with the
preferences, conversion and other rights, voting powers, restrictions,
limitations as to dividends, qualifications and terms and conditions of
redemption as set by the Board of Directors of the Corporation is as follows
(with each such class being herein referred to individually as a "Class" and
collectively as "Classes"):
1. All consideration received by the Corporation upon the sale and
issue of shares of a particular Class, and all income and other assets
resulting from the investment and reinvestment of that consideration,
income and other assets, will irrevocably be attributable to that Class of
shares, subject to the rights of creditors, and will be recorded on the
books of account of the Corporation as assets attributable to that Class.
2. Dividends or distributions on shares of a particular Class,
whether payable in stock or cash, will be paid only out of earnings,
surplus or other assets attributable to that Class of shares.
-2-
<PAGE>
3. In the event of the liquidation or dissolution of the
Corporation, holders of shares of a particular Class will be entitled to
receive, as a class, out of the assets of the Corporation available for
distribution to stockholders, but not including general assets not
attributable to a Class of shares, the assets attributable to that Class
of shares. The assets so distributable to the stockholders of that Class
will be distributed among such stockholders in proportion to the number of
shares of such Class held by them and recorded on the books of the
Corporation. If there are any general assets of the Corporation not
attributable to any specific Class of shares and available for
distribution, distribution of those other assets will be made to the
holders of shares of all Classes of the Corporation's Capital Stock in
proportion to the aggregate asset value of those Classes.
4. The assets attributable to shares of a particular Class will be
charged with the liabilities relating to that Class and will also be
charged with general liabilities of the Corporation in the proportion that
the aggregate asset value of that Class bears to the aggregate asset value
of all Classes of shares of the Corporation. The determination of the
Board or Directors will be conclusive as to the amount of liabilities
including accrued expenses and reserves, and as to the allocation of
liabilities among Classes. The liabilities so allocated to a Class are
herein referred to as liabilities attributable to that Class.
5. At each meeting of stockholders of the Corporation each
stockholder present in person or by proxy at the meeting will be entitled
to one vote for each share of stock standing in the stockholder's name on
the books of the Corporation, irrespective of the Class, except that where
a vote of the holders of the shares of a Class, or of more than one Class,
voting by Class, is required by the Investment Company Act of 1940 or the
laws of Maryland, or both, as to any proposal, only the holders of shares
of that Class or Classes, voting by Class, will be
-3-
<PAGE>
entitled to vote upon such proposal and the holders of any other Class or
Classes will not be entitled to vote thereon. Fractional shares will be
entitled proportionately to all the rights of a whole share, including the
right to vote and the right to receive dividends and other distributions.
6. The redemption rights of the holders of shares of a particular
Class will apply only to the assets attributable to that Class.
7. The net asset value per share computation provided for in Section
6 of ARTICLE V of the Corporation's Articles of Incorporation will be
determined for each Class of shares of the Corporation on the basis of the
assets and liabilities attributable to that Class and the outstanding
shares of that Class.
8. Except as otherwise provided herein, the shares of each Class
will have the same rights as provided in ARTICLE V of the Corporation's
Articles of Incorporation relating to the Capital Stock of the
Corporation.
FOURTH: The Shares aforesaid have been duly classified by the Board
of Directors pursuant to authority and power contained the Corporation's
Articles of Incorporation.
-4-
<PAGE>
IN WITNESS WHEREOF, LAZARD TAX-FREE RESERVES, INC. has caused these
present to be signed in its name and on its behalf by its President and attested
by its Secretary on April 28, 1987.
LAZARD TAX-FREE RESERVES, INC.
By /s/ Karl A. Deavers
------------------------
Karl A. Deavers, President
Attest:
/s/ Irene McC. Pelliconi
- ---------------------------------
Irene McC. Pelliconi, Secretary
-5-
<PAGE>
STATE OF NEW YORK )
: ss:
COUNTY OF NEW YORK )
The undersigned, President of LAZARD TAX-FREE RESERVES, INC., who
executed on behalf of said corporation the foreqoing Articles Supplementary to
the Articles of Incorporation of which this certificate is made a part, hereby
acknowledges, in the name and on behalf of said corporation, the foregoing
Articles Supplementary to the Articles of Incorporation to be the corporate act
of said corporation and further certifies that, to the best of his knowledge,
information and belief, the matters and facts set forth therein with respect to
the approval thereof are true in all material respects, under the penalties of
perjury.
/s/ Karl A. Deavers
----------------------
Karl A. Deavers
Sworn to before me on
this 28 day of April, 1987
/s/ Linda C. Joyce
- --------------------
Notary Public
Linda C. Joyce
Notary Public, State of New York
No. 24-4606383
Qualified in Rockland County
Commission Expires Aug. 31, 1989
-6-
EXHIBIT 1(c)
<PAGE>
ARTICLES OF MERGER
MERGING
LAZARD GOVERNMENT FUND, INC.
(a Corporation of the State of Maryland)
INTO
LAZARD TAX-FREE RESERVES, INC.
(a Corporation of the State of Maryland)
FIRST: Lazard Government Fund, Inc., a corporation organized and
existing under the laws of the State of Maryland, and Lazard Tax-Free Reserves,
Inc., a corporation organized and existing under the laws of the State of
Maryland, agree that said Lazard Government Fund, Inc. shall be merged into said
Lazard Tax-Free Reserves, Inc. The terms and conditions of the merger and the
mode of carrying the same into effect are as herein set forth in these Articles
of Merger.
SECOND: Lazard Tax-Free Reserves, Inc., a corporation organized and
existing under the laws of the State of Maryland, shall survive the merger and
shall continue under the name "Lazard Freres Funds, Inc."
THIRD: The parties to these Articles of Merger are Lazard Government
Fund, Inc. a corporation organized and existing under the laws of the State of
Maryland, and Lazard Tax-Free Reserves Inc., a corporation organized and
existing under the laws of the State of Maryland.
<PAGE>
FOURTH: The following amendment of the articles of incorporation of
the surviving corporation are to be effected as part of the merger:
By striking out Article II of the Articles of Incorporation of the
surviving corporation are inserting in lieu thereof the following:
Article II: Name. The name of the corporation is Lazard Freres
Funds, Inc. (the "Corporation").
FIFTH: The total number of shares of all classes of stock which said
Lazard Government Fund, Inc. has authority to issue is 10,000,000,000 shares of
Capital Stock of the par value of $.001 each and of the aggregate par value of
$10,000,000.
The total number of shares of all classes of stock which said Lazard
Tax-Free Reserves, Inc. has authority to issue is 10,000,000,000 shares of
Capital Stock of the par value of $.001 each and of the aggregate par value of
$10,000,000, of which 3,000,000,000 shares are designated as "Lazard Cash Fund",
3,000,000,000 shares are designated as "Lazard Government Fund", 1,000,000,000
shares are designated as "Lazard Tax-Free Money Market Fund", 100,000,000 shares
are designated as "Lazard Tax-Free Bond Fund", 100,000,000 shares are designated
as "Lazard New York Tax-Free Bond Fund", 100,000,000 shares are designated as
"Lazard Bond Fund" and 100,000,000 shares are designated as "Lazard Equity
Fund".
-2-
<PAGE>
SIXTH: The manner and basis of converting or exchanging issued stock
of the merged corporation into stock of the surviving corporation and the
treatment of any issued stock of the merged corporation not to be so converted
or exchanged are set forth in the Agreement and Plan of Merger, dated as of May
1, 1997, between said Lazard Government Fund, Inc. and said Lazard Tax-Free
Reserves, Inc., attached hereto as Exhibit I and incorporated herein by
reference.
SEVENTH: The principal office of said Lazard Government Fund, Inc.
is located in the City of New York, State of New York. Said Lazard Government
Fund, Inc. does not own property in the State of Maryland the title to which
could be affected by the recording of an instrument among the Land Records.
The principal office of said Lazard Tax-Free Reserves, Inc. is
located in the City of New York, State of New York.
EIGHTH: The terms and conditions of the transaction set forth in the
articles were advised, authorized and approved by each corporation party to the
articles in the manner and by the vote required by its charter and the laws of
the place where it is organized.
NINTH: The merger was approved in the following manner by Lazard
Tax-Free Reserves, Inc.
The transaction of merger was (a) duly advised by the Board of
Directors of said Lazard Tax-Free Reserves,
-3-
<PAGE>
Inc. by the adoption an December 18, 1986 of a resolution declaring that the
merger herein proposed was advisable substantially upon the terms and conditions
set forth in these Articles of Merger and directing that the proposed merger be
submitted for action thereon at the annual meeting of the stockholders of said
corporation; and (b) duly approved by the stockholders of said corporation at
the said meeting of stockholders held on April 21, 1987, by the affirmative vote
of a majority of the shares of capital stock of said corporation.
TENTH: The merger was approved in the following manner by Lazard
Government Fund, Inc.
The transaction of merger was (a) duly advised by the Board of
Directors of said Lazard Government Fund, Inc. by the adoption an December 18,
1986 of a resolution declaring that the merger herein proposed was advisable
substantially upon the terms and conditions set forth in these Articles of
Merger and directing that the proposed merger be submitted for action thereon at
the annual meeting of the stockholders of said corporation; and (b) duly
approved by the stockholders of said corporation in the manner and by the vote
required by law at the said meeting of stockholders held on April 21, 1987, by
the affirmative vote of a majority of the shares of capital stock of said
corporation.
-4-
<PAGE>
ELEVENTH: The merger shall be effected on May 1, 1987.
IN WITNESS WHEREOF, Lazard Government Fund, Inc. and Lazard Tax-Free
Reserves, Inc., the corporations parties to the merger, have caused these
Articles of Merger to be signed in their respective corporate names and on their
behalf by their respective presidents and attested by their respective
secretaries all as of the 28th day of April, 1987.
LAZARD GOVERNMENT FUND, INC.
By: /s/ Karl A. Deavers
--------------------------------------
Karl A. Deavers
President
/s/ Irene McC. Pelliconi
- -------------------------------
Irene McC. Pelliconi
Secretary
LAZARD TAX-FREE RESERVES, INC.
By: /s/ Karl A. Deavers
--------------------------------------
Karl A. Deavers
President
Attested:
/s/ Irene McC. Pelliconi
- -------------------------------
Irene McC. Pelliconi
Secretary
-5-
<PAGE>
STATE OF NEW YORK }
} ss.:
COUNTY OF NEW YORK }
The undersigned, President of LAZARD GOVERNMENT FUND, INC., who
executed on behalf of said corporation the foregoing Articles of Merger of which
this certificate is made a part, hereby acknowledges in the name and on behalf
of said corporation, the foregoing Articles of Merger to be the corporate act
of said corporation and further certifies that, to the best of his knowledge,
information and belief, the matters and facts set forth therein with respect to
the approval thereof are true in all material respects, under the penalties of
perjury.
/s/ Karl A. Deavers
--------------------------------------
Karl A. Deavers
Sworn to before me on
this 29 day of April, 1987
/s/ Linda C. Joyce
- --------------------------------------
Notary Public
LINDA C. JOYCE
NOTARY PUBLIC. State of New York
NO.24-4606383
Qualified in Rockland County
Commission Expires August 31, 1989
<PAGE>
STATE OF NEW YORK }
} ss.:
COUNTY OF NEW YORK }
The undersigned, President of LAZARD TAX-FREE RESERVES, INC., who
executed on behalf of said corporation the foregoing Articles of Merger of which
this certificate is made a part, hereby acknowledges in the name and on behalf
of said corporation, the foregoing Articles of Merger to be the corporate act of
said corporation and further certifies that, to the best of his knowledge,
information and belief, the matters and facts set forth therein with respect to
the approval thereof are true in all material respects, under the penalties of
perjury.
/s/ Karl A. Deavers
--------------------------------------
Karl A. Deavers
Sworn to before me on
this 29 day of April, 1987
/s/ Linda C. Joyce
- --------------------------------------
Notary Public
LINDA C. JOYCE
NOTARY PUBLIC. State of New York
NO.24-4606383
Qualified in Rockland County
Commission Expires August 31, 1989
<PAGE>
ARTICLES OF MERGER
MERGING
LAZARD CASH MANAGEMENT FUND, INC.
(a Corporation of the State of Maryland)
INTO
LAZARD TAX-FREE RESERVES, INC.
(a Corporation of the State of Maryland)
FIRST: Lazard Cash Management Fund, Inc., a corporation organized
and existing under the laws of the State of Maryland, and Lazard Tax-Free
Reserves, Inc., a corporation organized and existing under the laws of the State
of Maryland, agree that said Lazard Cash Management Fund, Inc. shall be merged
into said Lazard Tax-Free Reserves, Inc. The terms and conditions of the merger
and the mode of carrying the same into effect are as herein set forth in these
Articles of Merger.
SECOND: Lazard Tax-Free Reserves, Inc., a corporation organized and
existing under the laws of the State of Maryland, shall survive the merger and
shall continue under the name "Lazard Freres Funds, Inc."
THIRD: The parties to these Articles of Merger are Lazard Cash
Management Fund, Inc. a corporation organized and existing under the laws of the
State of Maryland, and Lazard Tax-Free Reserves, Inc., a corporation organized
and existing under the laws of the State of Maryland.
<PAGE>
FOURTH: The following amendment of the articles of incorporation of
the surviving corporation are to be effected as part of the merger:
By striking out Article II of the Articles of Incorporation of the
surviving corporation are inserting in lieu thereof the following:
Article II: Name. The name of the corporation is Lazard Freres
Funds, Inc. (the "Corporation").
FIFTH: The total number of shares of all classes of stock which said
Lazard Cash Management Fund, Inc. has authority to issue is 10,000,000,000
shares of Capital Stock of the par value of $.001 each and of the aggregate par
value of $10,000,000.
The total number of shares of all classes of stock which said Lazard
Tax-Free Reserves, Inc. has authority to issue is 10,000,000.000 shares of
Capital Stock of the par value of $.001 each and of the aggregate par value of
$10,000,000, of which 3,000,000,000 shares are designated as "Lazard Cash Fund",
3,000,000,000 shares are designated as "Lazard Government Fund", 1,000,000,000
shares are designated as "Lazard Tax-Free Money Market Fund", 100,000,000 shares
are designated as "Lazard Tax-Free Bond Fund", 100,000,000 shares are designated
as "Lazard New York Tax-Free Bond Fund", 100,000,000 shares are designated as
"Lazard Bond Fund" and 100,000,000 shares are designated as "Lazard Equity
Fund".
-2-
<PAGE>
SIXTH: The manner and basis of converting or exchanging issued stock
of the merged corporation into stock of the surviving corporation and the
treatment of any issued stock of the merged corporation not to be so converted
or exchanged are set forth in the Agreement and Plan of Merger, dated as of May
1, 1987, between said Lazard Cash Management Fund, Inc. and said Lazard Tax-Free
Reserves, Inc., attached hereto as Exhibit I and incorporated herein by
reference.
SEVENTH: The principal office of said Lazard Cash Management Fund,
Inc. is located in the City of New York, State of New York. Said Lazard Cash
Management Fund, Inc. does not own property in the State of Maryland the title
to which could be affected by the recording of an instrument among the Land
Records.
The principal office of said Lazard Tax-Free Reserves, Inc. is
located in the City of New York, State of New York.
EIGHTH: The terms and conditions of the transaction set forth in the
articles were advised, authorized and approved by each corporation party to the
articles in the manner and by the vote required by its charter and the laws of
the place where it is organized.
NINTH: The merger was approved in the following manner by Lazard
Tax-Free Reserves, Inc.
The transaction of merger was (a) duly advised by the Board of
Directors of said Lazard Tax-Free Reserves,
-3-
<PAGE>
Inc. by the adoption on December 18, 1986 of a resolution declaring that the
merger herein proposed was advisable substantially upon the terms and conditions
set forth in these Articles of Merger and directing that the proposed merger be
submitted for action thereon at the annual meeting of the stockholders of said
corporation; and (b) duly approved by the stockholders of said corporation at
the said meeting of stockholders held on April 21, 1987, by the affirmative vote
of a majority of the shares of capital stock of said corporation.
TENTH: The merger was approved in the following manner by Lazard
Cash Management Fund, Inc.
The transaction of merger was (a) duly advised by the Board of
Directors of said Lazard Cash Management Fund, Inc. by the adoption on December
18, 1986 of a resolution declaring that the merger herein proposed was advisable
substantially upon the terms and conditions set forth in these Articles of
Merger and directing that the proposed be submitted for action thereon at the
annual meeting merger of the stockholders of said corporation; and (b) duly
approved by the stockholders of said corporation in the manner and by the vote
required by law at the said meeting of stockholders held on April 21, 1987, by
the affirmative vote of a majority of the shares of capital stock of said
corporation.
-4-
<PAGE>
ELEVENTH: The merger shall be effected on May 1, 1987.
IN WITNESS WHEREOF, Lazard Cash Management Fund, Inc., and Lazard
Tax-Free Reserves, Inc., the corporations parties to the merger, have caused
these Articles of Merger to be signed in their respective corporate names and on
their behalf by their respective presidents and attested by their respective
secretaries all as of the 28th day of April, 1987.
LAZARD CASH MANAGEMENT FUND, INC.
By: /s/ Karl A. Deavers
--------------------------------------
Karl A. Deavers
President
/s/ Irene McC. Pelliconi
- -------------------------------
Irene McC. Pelliconi
Secretary
LAZARD TAX-FREE RESERVES, INC.
By: /s/ Karl A. Deavers
--------------------------------------
Karl A. Deavers
President
Attested:
/s/ Irene McC. Pelliconi
- -------------------------------
Irene McC. Pelliconi
Secretary
-5-
<PAGE>
STATE OF NEW YORK }
} ss.:
COUNTY OF NEW YORK }
The undersigned, President of LAZARD CASH MANAGEMENT FUND, INC., who
executed an behalf of said corporation the foregoing Articles of Merger of which
this certificate is made a part, hereby acknowledges in the name and on behalf
of said corporation, the foregoing Articles of Merger to be the corporate act of
said corporation and further certifies that, to the best of his knowledge,
information and belief, the matters and facts set forth therein with respect to
the approval thereof are true in all material respects, under the penalties of
perjury.
/s/ Karl A. Deavers
--------------------------------------
Karl A. Deavers
Sworn to before me on
this 29 day of April, 1987
/s/ Linda C. Joyce
- --------------------------------------
Notary Public
LINDA C. JOYCE
NOTARY PUBLIC. State of New York
NO.24-4606383
Qualified in Rockland County
Commission Expires August 31, 1989
<PAGE>
STATE OF NEW YORK }
} ss.:
COUNTY OF NEW YORK }
The undersigned, President of LAZARD TAX-FREE RESERVES,
INC., who executed an behalf of said corporation the foregoing Articles of
Merger of which this certificate is made a part, hereby acknowledges in the
name and on behalf of said corporation, the foregoing Articles of Merger to be
the corporate act of said corporation and further certifies that, to the best
of his knowledge, information and belief, the matters and facts set forth
therein with respect to the approval thereof are true in all material respects,
under the penalties of perjury.
/s/ Karl A. Deavers
--------------------------------------
Karl A. Deavers
Sworn to before me on
this 29 day of April, 1987
/s/ Linda C. Joyce
- --------------------------------------
Notary Public
LINDA C. JOYCE
NOTARY PUBLIC. State of New York
NO.24-4606383
Qualified in Rockland County
Commission Expires August 31, 1989
SCUDDER FUND, INC.
ARTICLES SUPPLEMENTARY TO THE
ARTICLES OF INCORPORATION
SCUDDER FUND, INC., a Maryland corporation having its principal
office in New York, New York (the "Corporation"), hereby certifies to the State
Department of Assessments and Taxation of Maryland that:
FIRST: The Board of Directors of the Corporation, at a meeting duly
convened and held on January 24, 1991, adopted a resolution classifying
1,000,000,000 unissued and unclassified shares, par value $.001 per share, of
the Capital Stock of the Corporation into a class designated "Managed Federal
Fund" by setting before the issuance of such shares, the preferences, conversion
and other rights, voting powers, restrictions, limitations as to dividends,
qualifications and terms and conditions of redemption thereof as hereinafter set
forth.
SECOND: A description of the shares so classified, with the
preferences, conversion and other rights, voting powers, restrictions,
limitations as to dividends, qualifications and terms and conditions of
redemption as set by the Board of Directors of the Corporation is as follows:
1. All consideration received by the Corporation upon the sale and
issue of shares of the Managed Federal Fund, and all income and other
assets resulting from the investment and reinvestment of that
consideration, income and other assets, will irrevocably be attributable
to that
<PAGE>
class of shares, subject to the rights of creditors, and will be recorded
on the books of account of the Corporation as assets attributable to that
class.
2. Dividends or distributions on shares of the Managed Federal Fund,
whether payable in stock or cash, will be paid only out of earnings,
surplus or other assets attributable to that class of shares.
3. In the event of the liquidation or dissolution of the
Corporation, holders of shares of the Managed Federal Fund will be
entitled to receive, as a class, out of the assets of the Corporation
available for distribution to stockholders, but not including general
assets not attributable to any specific class of shares, the assets
attributable to that class of shares. The assets so distributable to the
stockholders of that class will be distributed among such stockholders in
proportion to the number of shares of the Managed Federal Fund held by
them and recorded on the books of the Corporation. If there are any
general assets of the Corporation not attributable to any specific class
of shares and available for distribution, distribution of those other
assets will be made to the holders of shares of all classes of the
Corporation's Capital Stock in proportion to the aggregate asset value of
those classes.
4. The assets attributable to shares of the Managed Federal Fund
will be charged with the liabilities relating to that class and will also
be charged with general liabilities of the Corporation in the proportion
that the aggregate asset value of that class bears to the aggregate asset
value of all classes of shares of the Corporation. The determination of
the Board of Directors will be conclusive as to the amount of liabilities,
including accrued expenses and reserves, and as to the allocation of
liabilities among classes. The liabilities so allocated to a class are
herein referred to as liabilities attributable to that class.
5. At each meeting of stockholders of the Corporation each
stockholder present in person or by proxy at the meeting will be
entitled to one vote for each share of stock standing in the
-2-
<PAGE>
stockholder's name on the books of the Corporation, irrespective of the
class, except that where a vote of the holders of the shares of a class,
or of more than one class, voting by class, is required by the Investment
Company Act of 1940 or the laws of Maryland, or both, as to any proposal,
only the holders of shares of that class or classes, voting by class, will
be entitled to vote upon such proposal and the holders of any other class
or classes will not be entitled to vote thereon. Fractional shares will be
entitled proportionately to all the rights of a whole share, including the
right to vote and the right to receive dividends and other distributions.
6. The redemption rights of the holders of shares of the Managed
Federal Fund will apply only to the assets attributable to that class.
7. The net asset value per share computation provided for in Section
6 of ARTICLE V of the Corporation's Articles of Incorporation will be
determined for each class of shares of the Corporation on the basis of the
assets and liabilities attributable to that class and the outstanding
shares of that class.
8. Except as otherwise provided herein, the shares of the Managed
Federal Fund will have the same rights as provided in ARTICLE V of the
Corporation's Articles of Incorporation relating to the Capital Stock of
the Corporation.
-3-
<PAGE>
THIRD: The Shares aforesaid have been duly classified by the Board
of Directors pursuant to authority and power contained in the Corporation's
Articles of Incorporation.
IN WITNESS WHEREOF, SCUDDER FUND, INC. has caused these presents
to be signed in its name and on its behalf by its Chairman and attested by its
Secretary on February 14, 1991.
SCUDDER FUND, INC.
By /s/ Karl A. Deavers
-----------------------------
Karl A. Deavers, Chairman
Attest:
/s/ Irene McC. Pelliconi
- -------------------------------
Irene McC. Pelliconi, Secretary
-4-
<PAGE>
STATE OF NEW YORK )
: ss:
COUNTY OF NEW YORK )
The undersigned, Chairman of SCUDDER FUND, INC., who executed on
behalf of said corporation the foregoing Articles Supplementary to the Articles
of Incorporation of which this certificate is made a part, hereby acknowledges,
in the name and on behalf of said corporation, the foregoing Articles
Supplementary to the Articles of Incorporation to be the corporate act of said
corporation and further certifies that, to the best of his knowledge,
information and belief, the matters and facts set forth therein with respect to
the approval thereof are true in all material respects, under the penalties of
perjury.
/s/ Karl A. Deavers
------------------------
Karl A. Deavers
Sworn to before me on this 14th day of February 1991
/s/ Patricia S. Rocovich
- ------------------------------
Notary Public
[NOTARY STAMP]
-5-
EXHIBIT 1(e)
ARTICLES OF TRANSFER
Scudder Fund, Inc., a Maryland corporation (hereinafter the
"Transferor"), and The Lazard Funds, Inc., a Maryland corporation (hereinafter
the "Transferee"), hereby certify that:
FIRST: The Transferor agrees to transfer all or substantially all of
its property and assets belonging to its portfolio known as Lazard Equity Fund
("Equity Fund") to the Transferee for its Lazard Equity Portfolio. The assets to
be transferred are less than substantially all of the assets of the Transferor,
which will continue to conduct its business. These Articles of Transfer are not
required to be filed by law and are being filed voluntarily. Upon acceptance for
record of these Articles, the transfer is to be effective on the later of
January 1, 1992 or upon the satisfaction of all of the conditions and
obligations contained in Section 11 of the Agreement and Plan of Reorganization
among the Transferor, the Transferee and Lazard Freres & Co. dated as of
December 2, 1991.
SECOND: The Transferor and Transferee are both Maryland
corporations.
THIRD: The address and principal place of business of the Transferee
is One Rockefeller Plaza, New York, New York 10020.
<PAGE>
FOURTH: The principal office in Maryland of the Transferor is
located in Baltimore City. The principal office in Maryland of the Transferee is
located in Baltimore City. Neither the Transferor nor the Transferee owns an
interest in land in any county in the State of Maryland.
FIFTH: The consideration to be paid by the Transferee for the assets
of the Transferor belonging to its Equity Fund shall be the assumption by the
Transferee of all liabilities of the Transferor allocable to its Equity Fund and
the transfer to the Transferor of shares of the Transferee's Lazard Equity
Portfolio, with a net asset value equal to the net asset value of the assets
transferred. The number of shares to be received by the Transferee will be equal
in number to the number of full and fractional shares, $.001 par value, of
Equity Fund issued and outstanding as of the close of business on December 31,
1991.
SIXTH: The terms and conditions of the transaction set forth in
these Articles of Transfer were advised, authorized and approved by the
Transferor and the Transferee in the manner and by the vote required by their
respective charters and the laws of Maryland. The manner of approval by the
Transferor and the Transferee of the transaction set forth in these Articles is
as follows:
(a) The board of directors of the Transferor duly adopted a
resolution on August 14, 1991, that declared that the transaction set forth in
these Articles of Transfer is
-2-
<PAGE>
advisable and directed that the transaction be submitted for consideration by
the stockholders at a Special Meeting of Stockholders. The transaction was duly
approved by the stockholders of the Transferor in the manner and by the vote
required by law at the Special Meeting of the Stockholders held on December 17,
1991, by the affirmative vote of a majority of the stock entitled to vote
thereon.
(b) The Board of Directors of the Transferee by resolution adopted
on September 11, 1991 duly approved the transaction set forth in these Articles
of Transfer.
IN WITNESS WHEREOF, on this 20th day of December 1991 the Transferor
and the Transferee have caused these Articles of Transfer to be signed in their
respective corporate names and on their behalf by their respective Chairman of
the Board of Directors or Vice-President who acknowledge respectively that these
Articles of Transfer are the act of the Transferor and the Transferee and that
to the best of their knowledge, information and belief and under penalties of
perjury, all matters and facts with respect to authorization and approval of the
transfer contained in
-3-
<PAGE>
these Articles of Transfer are true in all material respects.
SCUDDER FUND, INC.
on behalf of
Lazard Equity Fund
By /s/ [Illegible]
----------------------
Chairman of the Board
of Directors
Attested:
/s/ [Illegible]
- ---------------------
Secretary
THE LAZARD FUNDS, INC.
on behalf of
Lazard Equity Portfolio
By /s/ [Illegible]
--------------------
Vice-President
Attested:
/s/ [Illegible]
- ---------------------
Assistant Secretary
-4-
SCUDDER FUND, INC.
ARTICLES SUPPLEMENTARY TO THE
ARTICLES OF INCORPORATION
SCUDDER FUND, INC., a Maryland corporation having its principal
office in New York, New York (the "Corporation"), hereby certifies to the State
Department of Assessments and Taxation of Maryland that:
FIRST: The Board of Directors of the Corporation, at a meeting duly
convened and held on January 30, 1992, adopted a resolution reclassifying the
entire 100,000,000 shares classified as the "Lazard Equity Fund," par value
$.001 per share, all of which shares are currently unissued, as unissued and
unclassified shares of the Capital Stock of the Corporation having the same
rights as provided in ARTICLE V of the Corporation's Articles of Incorporation
relating to the Capital Stock of the Corporation.
SECOND: The aforesaid shares have been duly reclassified by the
Board of Directors pursuant to authority and power contained in the
Corporation's Articles of Incorporation.
IN WITNESS WHEREOF, on this 5th day of February 1992, SCUDDER FUND,
INC. has caused these presents to be signed in its name and on its behalf by its
Chairman who acknowledges these Articles Supplementary to the Articles of
Incorporation to be the corporate act of said corporation
<PAGE>
and who verifies under penalties of perjury that to the best of his knowledge,
information and belief, all matters and facts set forth herein are true in all
material aspects.
SCUDDER FUND, INC.
By /s/ Karl A. Deavers
-------------------------
Karl A. Deavers,
Chairman
Attest:
/s/ Irene McC. Pelliconi
- -------------------------
Irene Pelliconi, Secretary
-2-
Exhibit 1(g)
<PAGE>
SCUDDER FUND, INC.
ARTICLES SUPPLEMENTARY TO THE
ARTICLES OF INCORPORATION
SCUDDER FUND, INC., a Maryland corporation having its principal
office in New York, New York (the "Corporation"), hereby certifies to the State
Department of Assessments and Taxation of Maryland that:
FIRST: The Board of Directors of the Corporation, at a meeting duly
convened and held on December 22, 1992, adopted a resolution classifying
100,000,000 unissued and unclassified shares, par value $.001 per share, of the
Capital Stock of the Corporation into a class designated "Managed Intermediate
Government Fund" by setting before the issuance of such shares, the preferences,
conversion and other rights, voting powers, restrictions, limitations as to
dividends, qualifications and terms and conditions of redemption thereof as
hereinafter set forth.
SECOND: A description of the shares so classified, with the
preferences, conversion and other rights, voting powers, restrictions,
limitations as to dividends, qualifications and terms and conditions of
redemption as set by the Board of Directors of the Corporation is as follows:
1. All consideration received by the Corporation upon the sale and
issue of shares of the Managed Intermediate Government Fund, and all
income and other assets resulting from the investment and reinvestment of
that consideration, income and other assets, will irrevocably be
<PAGE>
attributable to that class of shares, subject to the rights of creditors
and will be recorded on the books of account of the Corporation as assets
attributable to that class.
2. Dividends or distributions on shares of the Managed Intermediate
Government Fund, whether payable in stock or cash, will be paid only out
of earnings, surplus or other assets attributable to that class of shares.
3. In the event of the liquidation or dissolution of the
Corporation, holders of shares of the Managed Intermediate Government Fund
will be entitled to receive, as a class, out of the assets of the
Corporation available for distribution to stockholders, but not including
general assets not attributable to any specific class of shares, the
assets attributable to that class of shares. The assets so distributable
to the stockholders of that class will be distributed among such
stockholders in proportion to the number of shares of the Managed
Intermediate Government Fund held by them and recorded on the books of the
Corporation. If there are any general assets of the Corporation not
attributable to any specific class of shares and available for
distribution, distribution of those other assets will be made to the
holders of shares of all classes of the Corporation's Capital Stock in
proportion to the aggregate asset value of those classes.
4. The assets attributable to shares of the Managed Intermediate
Government Fund will be charged with the liabilities relating to that
class and will also be charged with general liabilities of the Corporation
in the proportion that the aggregate asset value of that class bears to
the aggregate asset value of all classes of shares of the Corporation. The
determination of the Board of Directors will be conclusive as to the
amount of liabilities, including accrued expenses and reserves, and as to
the allocation of liabilities among classes. The liabilities so allocated
to a class are herein referred to as liabilities attributable to that
class.
5. At each meeting of stockholders of the Corporation each
stockholder present in person or by proxy at the meeting will be entitled
to one
-2-
<PAGE>
vote for each share of stock standing in the stockholder's name on the
books of the Corporation, irrespective of the class, except that where a
vote of the holders of the shares of a class, or of more than one class,
voting by class, is required by the Investment Company Act of 1940 or the
laws of Maryland, or both, as to any proposal, only the holders of shares
of that class or classes, voting by class, will be entitled to vote upon
such proposal and the holders of any other class or classes will not be
entitled to vote thereon. Fractional shares will be entitled
proportionately to all the rights of a whole share, including the right to
vote and the right to receive dividends and other distributions.
6. The redemption rights of the holders of shares of the Managed
Intermediate Government Fund will apply only to the assets attributable to
that class.
7. The net asset value per share computation provided for in Section
6 of ARTICLE V of the Corporation's Articles of Incorporation will be
determined for each class of shares of the Corporation on the basis of the
assets and liabilities attributable to that class and the outstanding
shares of that class.
8. Except as otherwise provided herein, the shares of the Managed
Intermediate Government Fund will have the same rights as provided in
ARTICLE V of the Corporation's Articles of Incorporation relating to the
Capital Stock of the Corporation.
THIRD: The Shares aforesaid have been duly classified by the Board
of Directors pursuant to authority
-3-
<PAGE>
and power contained in the Corporation's Articles of Incorporation.
IN WITNESS WHEREOF, SCUDDER FUND, INC. has caused these presents to
be signed in its name and on its behalf by its Chairman and attested by its
Secretary on January 15, 1993.
SCUDDER FUND, INC.
By /s/ Karl A. Deavers
------------------------------
Karl A. Deavers, Chairman
Attest:
/s/ Irene McC. Pelliconi
- -------------------------------
Irene McC. Pelliconi, Secretary
-4-
EXHIBIT 2(a)
SCUDDER FUND, INC.
BY-LAWS
(AS AMENDED THROUGH OCTOBER 24, 1991)
Stockholders
SECTION 1. Place of Meeting. Meetings of stockholders shall be
held at such place within or without the State of Maryland as the Board
of Directors may determine.
SECTION 2. Annual Meetings. The annual meeting of the stockholders shall
be held during the 30-day period commencing April 1 of each year on such date
and at such hour as may from time to time be designated by the Board of
Directors and stated in the notice of such meeting, for the transaction of such
business as may properly be brought before the meeting; provided, however, that
an annual meeting of stockholders shall not be required to be held in any year
in which none of the following is required to be acted on by stockholders
pursuant to the Investment Company Act of 1940 (the "Act"): election of
directors; approval of the investment advisory agreement; ratification of the
selection of independent public accountants; and approval of a distribution
agreement. Any business of the Corporation may be considered at an annual
meeting without being specified in the notice, except as otherwise required by
law.
SECTION 3. Special Meetings. Special meetings of stockholders for any
purpose may be called by the Chairman of the Board, the President or the Board
of Directors, and shall be called by the Secretary upon receipt of (a) a written
request stating the purpose of the proposed meeting signed by holders of record
entitled to cast at least 25% of all the votes entitled to be cast at any such
meeting and (b) the payment by such stockholders of the reasonably estimated
cost of preparing and mailing notice of such meeting. No special meeting need be
called upon the request of the holders of less than a majority of all votes
entitled to be cast at such meeting to consider any matter which is
substantially the same as a matter voted upon at any special meeting of
stockholders held during the preceding twelve months.
SECTION 4. Record Dates. The Board of Directors may fix, in advance, a
date as the record date for the purpose of determining stockholders entitled to
notice of, or to vote at, any meeting of stockholders, or stockholders entitled
to receive payment of any dividend or the allotment of any other rights, or in
order to make a determination of stockholders for any other proper purpose. Such
date in any case shall be not more than 90 days, and in case of a meeting of
stockholders, not less than 10 days, prior to the date on which the particular
action, requiring such determination of stockholders, is to be taken.
<PAGE>
SECTION 5. Notice of Meeting. Not less than 10 and not more than 90 days
before each meeting of stockholders, the Secretary shall give to each
stockholder entitled to vote at the meeting and to each other stockholder
entitled to notice of such meeting, written notice of the time, date, place and,
in the case of a special meeting or when otherwise required by the laws of the
State of Maryland, the purpose or purposes of the meeting.
SECTION 6. Adjournment. A meeting of stockholders may be adjourned from
time to time without further notice, other than as announced at the meeting, to
a date not more than 120 days after the original record date. At any such
adjourned meeting at which a quorum shall be present, any action may be taken
that could have been taken at the meeting originally called.
SECTION 7. Quorum and Voting. Except as otherwise provided by law or the
Articles of Incorporation of the Corporation, at any meeting of stockholders the
presence in person or by proxy of the holders of record of shares of capital
stock of the Corporation entitled to cast one-third of the votes thereat,
without distinction as to class, shall constitute a quorum at that meeting.
Except as otherwise provided by law, a majority of the votes cast at a meeting
of stockholders, at which a quorum is present, shall be sufficient to take or
authorize action upon any matter which may properly come before the meeting.
SECTION 8. Conduct of Meetings. Each meeting of stockholders shall be
presided over by the President or, if he is not present, by the Chairman of the
Board or any Vice President or, if none of them is present, by a chairman to be
elected at the meeting. The Secretary shall act as secretary of the meeting or,
if he is not present, an Assistant Secretary shall so act. If neither the
Secretary nor an Assistant Secretary is present, the chairman of the meeting
shall appoint a secretary.
ARTICLE II
Board of Directors
SECTION 1. Powers. The business and affairs of the Corporation shall be
managed by or under the direction of the Board of Directors, which may exercise
all powers of the Corporation and do all lawful acts and things that are not by
law, the Articles of Incorporation of the Corporation or these By-Laws directed
or required to be done by the stockholders.
SECTION 2. Number and Tenure. The number of Directors fixed by the
Articles of Incorporation of the Corporation as the number which shall
constitute the whole Board may be increased or decreased by a vote of a majority
of the entire Board of Directors from time to time, provided that this number
shall not be less than three nor more than 21.
-2-
<PAGE>
Each Director shall hold office until his successor is elected and qualifies or
until his earlier resignation or removal.
SECTION 3. Vacancies. Vacancies in the Board of Directors for any cause,
including an increase in the authorized number of Directors, may, subject to the
Investment Company Act of 1940, be filled by a majority of the Directors then in
office, although less than a quorum, or by a sole remaining Director. A Director
elected by the Board of Directors to fill a vacancy serves until the next annual
meeting of stockholders and until his successor is elected and qualifies.
SECTION 4. Removal of Directors. At any meeting of stockholders, the
stockholders may remove any Director from office, either with or without cause,
and may elect a successor to fill any resulting vacancy for the unexpired term
of the removed Director.
SECTION 5. Place of Meetings. Meetings of the Board of Directors,
regular or special, may be held at any place within or without the
State of Maryland as the Board of Directors may determine.
SECTION 6. Regular Meetings. Regular meetings of the Board of Directors
shall be held as soon as practicable after such annual meeting of stockholders
and at any other time stated by the Board of Directors. No notice of regular
meetings shall be required.
SECTION 7. Special Meetings. Special Meetings of the Board of Directors
may be called at any time by the Chairman of the Board, the President or a
majority of the Directors. Written notice of the time and place of any special
meeting shall be delivered or telegraphed to each Director not less than one day
before the meeting or mailed to each Director not less than three days before
the meeting.
SECTION 8. Telephone Meetings. Members of the Board of Directors or any
committee thereof may participate in a meeting by means of conference telephone
or similar communications equipment if all persons participating in the meeting
can hear each other at the same time.
SECTION 9. Quorum. One-third of the total number of Directors shall
constitute a quorum for the transaction of business, provided that a quorum
shall in no case be less than two Directors. If at any meeting of the Board of
Directors there shall be less than a quorum present, a majority of those present
may adjourn the meeting until a quorum shall have been obtained. Except as
otherwise provided by law, the Articles of Incorporation of the Corporation,
these By-Laws or any contract or agreement to which the Corporation is a party,
the act of a majority of the Directors present at any meeting at which there is
a quorum shall be the act of the Board of Directors.
-3-
<PAGE>
SECTION 10. Committees. The Board of Directors may by resolution passed by
a majority of the whole Board designate an executive committee and other
committees composed of two or more Directors, and the members thereof, to the
extent permitted by law, and each committee shall have the powers, authority and
duties specified in the resolution creating the same and permitted by law. If a
member of a committee is absent or disqualified, the members present at a
meeting and not disqualified from voting, whether or not constituting a quorum,
may unanimously appoint another member of the Board of Directors to act at the
meeting in place of the absent or disqualified member.
SECTION 11. Compensation of Directors. The Board of Directors may
authorize reasonable compensation to Directors for their services as Directors
and as members of committees of the Board of Directors and may authorize the
reimbursement of reasonable expenses incurred by Directors in connection with
rendering those services.
ARTICLE III
Officers
Section 1. Election and Removal. As soon as practicable after each annual
meeting of stockholders, the Board of Directors shall elect a Chairman of the
Board, a President, a secretary and a Treasurer. The Board of Directors may also
in its discretion elect one or more Vice Presidents, Assistant Secretaries,
Assistant Treasurers and other officers, agents and employees. Any two or more
offices, except those of President and Vice President, may be held by the same
person. The Board of Directors may fill any vacancy which may occur in any
office. All officers shall hold office at the pleasure of the Board of
Directors, and any officer may be removed from office at any time with or
without cause by the vote of a majority of the entire Board of Directors
whenever, in the judgment of the Board of Directors, the best interests of the
Corporation will be served thereby.
SECTION 2. Powers and Duties. The officers of the Corporation shall have
such powers and duties as generally pertain to their respective offices as well
as such powers and duties as may from time to time be conferred by resolution of
the Board of Directors
ARTICLE IV
Indemnification
The Corporation will indemnify any person who was or is a director,
officer or employee of the Corporation and will advance the reasonable expenses
incurred by any of them who are parties to a proceeding to the maximum extent
permitted by the Maryland General Corporation Law subject to the limitations of
the Act. The foregoing rights shall inure to the benefit of the heirs, executors
and administrators of each director, officer or employee of the Corporation.
-4-
<PAGE>
ARTICLE V
General Provisions
SECTION 1. Annual Statement. The Chairman of the Board, the President or
the Treasurer shall prepare or cause to be prepared annually a full and correct
statement of the affairs of the Corporation, including a balance sheet and a
financial statement of operations for the preceding fiscal year, which shall be
submitted at the annual meeting of stockholders and shall be filed within 20
days thereafter at the principal office of the Corporation in the State of
Maryland.
SECTION 2. Stock Ledger. The Corporation shall maintain at a location
specified by the Board of Directors an original or duplicate stock ledger
containing the names and addresses of all stockholders and the number of shares
of each class held by each stockholder. Such stock ledger may be in written form
or any other form capable of being converted into written form within a
reasonable time for visual inspection.
SECTION 3. Amendment of By-Laws. These By-Laws may be altered, amended,
added to or repealed by the stockholders or by the Board of Directors, provided
that this Section 3 may be altered, amended, added to or repealed only by the
stockholders.
-5-
10093332 EXHIBIT 5(a)1
SCUDDER FUND, INC.
345 Park Avenue
New York, New York 10154
May 1, 1989
Scudder, Stevens & Clark, Inc.
345 Park Avenue
New York, NY 10154
Investment Advisory Agreement
Managed Government Fund
Dear Sirs:
Scudder Fund, Inc. (the "Corporation") has been organized under the
laws of the State of Maryland to engage in the business of an investment
company. The shares of capital stock of the Corporation ("Shares") are divided
into multiple series, including Managed Government Fund (the "Fund"), as
established from time to time by action of the Directors of the Corporation.
Series may be terminated, and additional series established, from time to time
by action of the Directors. The Corporation, on behalf of the Fund, has selected
you to act as the sole investment adviser of the Fund and to provide certain
other services, as more fully set forth below, and you are willing to act as
such investment adviser and to perform such services under the terms and
conditions hereinafter set forth. Accordingly, the Corporation agrees with you
as follows:
1. Delivery of Fund Documents. The Corporation has furnished you
with copies properly certified or authenticated of each of the following:
(a) Articles of Incorporation of the Corporation dated June 18,
1982, as amended from time to time (the "Articles");
(b) Appropriate evidence of the establishment of the Fund as a
series portfolio of the Corporation;
(c) By-Laws of the Corporation as in effect on the date hereof
(the "By-Laws");
<PAGE>
Scudder, Stevens
& Clark, Inc. 2 May 1, 1989
(d) Resolutions of the Directors of the Corporation selecting you
as investment adviser and approving the form of this
Agreement; and
(e) Properly certified or authenticated copies of the
Corporation's Registration Statement on Form N-1A filed by it
with the Securities and Exchange Commission under the
Securities Act of 1933, as amended, or the Investment Company
Act of 1940, as amended (the "Investment Company Act"),
together with any financial statements and exhibits included
therein.
The Corporation will furnish you from time to time with copies, properly
certified or authenticated, of all amendments of or supplements to the
foregoing, if any.
2. Name of Fund. The Fund may use any name derived from the name
"Scudder, Stevens & Clark", if it elects to do so, only for so long as this
Agreement, any other Investment Advisory Agreement between you and the
Corporation or any extension, renewal or amendment hereof or thereof remains in
effect, including any similar agreement with any organization which shall have
succeeded to your business as investment adviser. At such time as such an
agreement shall no longer be in effect, the Fund will (to the extent that it
lawfully can) cease to use such a name or any other name indicating that it is
advised by or otherwise connected with you or any organization which shall have
so succeeded to your business.
3. Advisory Services. You will regularly provide the Fund with
investment research, advice and supervision and will furnish continuously an
investment program for the Fund consistent with the investment objective and
policies of the Fund. You will determine what securities shall be purchased for
the Fund, what securities shall be held or sold by the Fund and what portion of
the Fund's assets shall be held uninvested, subject always to the provisions of
the Corporation's Articles and By-Laws and of the Investment Company Act, and to
the investment objective, policies and restrictions of the Fund, as each of the
same shall be from time
<PAGE>
Scudder, Stevens
& Clark, Inc. 3 May 1, 1989
to time in effect, and subject, further, to such policies and instructions as
the Board of Directors may from time to time establish. You shall advise and
assist the officers of the Fund in taking such steps as are necessary or
appropriate to carry out the decisions of the Board of Directors and the
appropriate committees of the Board of Directors regarding the conduct of the
business of the Fund.
4. Allocation of Charges and Expenses. You will pay the compensation
and expenses of all officers and executive employees of the Corporation who are
also employees or affiliates of you or your affiliates and will make available,
without expense to the Fund (except as otherwise provided below), the services
of such of your directors, officers and employees as are reasonably necessary
for the Fund's operations or as may duly be elected officers or directors of the
Corporation, subject to their individual consent to serve and to any limitations
imposed by law. You will pay the Fund's office rent and will provide investment
advisory research and statistical facilities and all clerical services relating
to research, statistical and investment work. You will not be required to pay
any expenses of the Fund other than those specifically allocated to you in this
paragraph 4. In particular, but without limiting the generality of the
foregoing, you will not be required to pay: organization expenses of the Fund;
clerical salaries; fees and expenses incurred by the Fund in connection with
membership in investment company organizations; brokerage and other expenses of
executing portfolio transactions; payment for portfolio pricing services to a
pricing agent, if any; legal, auditing or accounting expenses; trade association
dues; taxes or governmental fees; the fees and expenses of the transfer agent of
the Fund; the cost of preparing share certificates or any other expenses,
including clerical expenses of issue, redemption or repurchase of Shares of the
Fund; the expenses and fees for registering and qualifying securities for sale;
the fees and expenses of Directors of the Corporation who are not employees or
affiliates of you or your affiliates; travel expenses of all officers, directors
and employees; insurance premiums; the cost of preparing and distributing
reports and notices to shareholders; public and investor relations expenses or
the fees or disbursements of custodians of the Fund's
<PAGE>
Scudder, Stevens
& Clark, Inc. 4 May 1, 1989
assets, including expenses incurred in the performance of any obligations
enumerated by the Articles or By-Laws insofar as they govern agreements with any
such custodian. You shall not be required to pay expenses of any activity which
is primarily intended to result in sales of Shares of the Fund if and to the
extent that such expenses (i) are required to be borne by a principal
underwriter which acts as the distributor of the Fund's Shares pursuant to an
underwriting agreement which provides that the underwriter shall assume some or
all of such expenses, or (ii) the Corporation on behalf of the Fund shall have
adopted a plan in conformity with Rule 12b-1 under the Investment Company Act of
1940, as amended, providing that the Fund (or some other party) shall assume
some or all of such expenses. You shall be required to pay such of the foregoing
expenses as are not required to be paid by the principal underwriter pursuant to
the underwriting agreement or are not permitted to be paid by the Fund (or some
other party) pursuant to such a plan.
5. Compensation of the Adviser. For all services to be rendered and
payments made as provided in paragraphs 3 and 4 hereof, the Corporation on
behalf of the Fund will pay you on the last day of each month a gross fee which
is equal to the difference between (a) 1/12 of 0.40% of the value of the average
daily net assets of the Fund up to but not exceeding $1.5 billion for such month
and 1/12 of 0.35% of the value of the average daily net assets of the Fund in
excess of $1.5 billion for such month and (b) the sum, not in excess of the
amount determined under (a), of the amount waived by you from time to time plus
the amount by which the Fund's expenses exceed the lowest applicable expense
limitation (as more fully described herein).
(a) The "value of the average daily net assets" of the Fund is
defined as the average of the values placed on the net assets of the Fund
as of 12:00 noon (New York time), on each day on which the net asset value
of the Fund is determined consistent with the provisions of Rule 22c-1
under the Investment Company Act or, if the Fund lawfully determines the
value of the net assets of the Fund as of some other time on each business
day, as of such time. The value of the net assets of the Fund shall be
determined pursuant
<PAGE>
Scudder, Stevens
& Clark, Inc. 5 May 1, 1989
to the applicable provisions of the Articles. If, pursuant to such
provisions, the determination of the net asset value of the Fund is
suspended for any particular business day, then for the purposes of this
paragraph 5, the value of the net assets of the Fund as last determined
shall be deemed to be the value of the net assets of the Fund as of 12:00
noon or as of such other time as the value of the net assets of the Fund
may lawfully be determined, on that day. If the determination of the value
of the net assets of the Fund has been suspended pursuant to the Articles
for a period including such month, your compensation payable at the end of
such month shall be computed on the basis of the value of the net assets
of the Fund as last determined (whether during or prior to such month). If
the Fund determines the value of the net assets of its portfolio more than
once on any day, the last such determination thereof on that day shall be
deemed to be the sole determination thereof on that day for the purposes
of this paragraph 5.
(b) You agree that in determining your gross compensation for any
fiscal year it shall be reduced by the amount, if any, by which the
expenses of the Fund for such fiscal year exceed the lowest applicable
expense limitation established pursuant to the statutes or regulations of
any jurisdiction in which the Shares of the Fund may be qualified for
offer and sale. You shall refund to the Fund the amount of any reduction
of your compensation pursuant to this paragraph 5 as promptly as
practicable after the end of such fiscal year, provided that you will not
be required to pay the Fund an amount greater than the fee paid to you in
respect of such year pursuant to this Agreement. As used in this paragraph
5, "expenses" shall mean those expenses included in the applicable expense
limitation having the broadest specifications thereof, and "expense
limitation" means a limit on the maximum annual expenses which may be
incurred by an investment company determined (i) by multiplying a fixed
percentage by the average, or by multiplying more than one such percentage
by different specified amounts of the average, of the values of an
investment company's net assets for a fiscal year or (ii) by multiplying a
fixed percentage
<PAGE>
Scudder, Stevens
& Clark, Inc. 6 May 1, 1989
by an investment company's net investment income for a fiscal year. The
words "lowest applicable expense limitation" shall be construed to result
in the largest reduction of your compensation for any fiscal year of the
Fund; provided, however, that nothing in this Agreement shall require you
to reduce your fees if not required by an applicable statute or regulation
referred to above in this paragraph 5.
(c) You may waive all or a portion of your fees provided for
hereunder. To the extent that you agree to waive all or a portion of your
fees or to reimburse a portion of the Fund's expenses, you shall be
contractually bound by the publicly announced waivers or reimbursements.
6. Avoidance of Inconsistent Position. In connection with purchases
or sales of portfolio securities for the account of the Fund, neither you nor
any of your directors, officers or employees will act as a principal or agent or
receive any commission. You or your agent shall arrange for the placing of all
orders for the purchase and sale of portfolio securities for the Fund's account
with brokers or dealers selected by you. In the selection of such brokers or
dealers and the placing of such orders, you are directed at all times to seek
for the Fund the most favorable execution and net price available. If any
occasion should arise in which you give any advice to clients of yours
concerning the Shares of the Fund, you will act solely as investment counsel for
such clients and not in any way on behalf of the Fund. Your services to the Fund
pursuant to this Agreement are not to be deemed to be exclusive and it is
understood that you may render investment advice, management and other services
to others.
7. Limitation of Liability of Adviser. (a) You shall give the Fund
the benefit of your best judgment and efforts in rendering services under this
Agreement. As an inducement to your undertaking to render these services, the
Fund agrees that you shall not be liable under this Agreement for any mistake in
judgment or in any other event whatsoever except for lack of good faith,
provided that nothing in this Agreement shall be deemed to protect or purport to
protect you against any
<PAGE>
Scudder, Stevens
& Clark, Inc. 7 May 1, 1989
liability to the Fund or its shareholders to which you would otherwise be
subject by reason of willful misfeasance, bad faith or gross negligence in the
performance of your duties under this Agreement or by reason of your reckless
disregard of your duties and obligations hereunder.
(b) Notwithstanding anything herein to the contrary, you shall not
be liable or responsible for any acts or omissions of any predecessor manager or
investment adviser for the Fund or of any other persons having responsibility
for matters to which this Agreement relates prior to January 1, 1989, nor shall
you be responsible for reviewing any such acts or omissions. You shall, however,
be liable for your own acts and omissions subsequent to assuming responsibility
under this Agreement as herein provided.
8. Duration and Termination of this Agreement. This Agreement shall
remain in force until May 1, 1991 and from year to year thereafter, but only for
so long as such continuance is specifically approved at least annually (i) by
the vote of a majority of the Directors who are not interested persons of you or
of the Corporation, cast in person at a meeting called for the purpose of voting
on such approval, and (ii) by a vote of the Board of Directors or of a majority
of the outstanding voting securities of the Fund. The aforesaid requirement that
continuance of this Agreement be "specifically approved at least annually" shall
be construed in a manner consistent with the Investment Company Act and the
rules and regulations thereunder. This Agreement may, on 60 days' written
notice, be terminated at any time without the payment of any penalty, by the
Board of Directors, by vote of a majority of the outstanding voting securities
of the Fund, or by you. This Agreement shall automatically terminate in the
event of its assignment. In interpreting the provisions of this Agreement, the
definitions contained in Section 2(a) of the Investment Company Act
(particularly the definitions of "interested person," "assignment" and "majority
of the outstanding voting securities"), as from time to time amended, shall be
applied, subject, however, to such exemptions as may be granted by the
Securities and Exchange Commission by any rule, regulation or order.
<PAGE>
Scudder, Stevens
& Clark, Inc. 8 May 1, 1989
9. Amendment of this Agreement. No provisions of this Agreement may
be changed, waived, discharged or terminated orally, but only by an instrument
in writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought, and no amendment of this Agreement shall be
effective until approved by vote of the holders of a majority of the outstanding
voting securities of the Fund and by the Board of Directors, including a
majority of the Directors who are not interested persons of you or of the
Corporation, cast in person at a meeting called for the purpose of voting on
such approval.
10. Miscellaneous. 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. The
Agreement may be executed simultaneously in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
If you are in agreement with the foregoing, please sign the form of
acceptance on the accompanying counterpart of this letter and return such
counterpart to
<PAGE>
Scudder, Stevens
& Clark, Inc. 9 May 1, 1989
the Corporation, whereupon this letter shall become a binding contract.
Yours very truly,
SCUDDER FUND, INC.
on behalf of
Managed Government Fund
By /s/ Karl A. Deavers
----------------------------
Title: Chairman
The foregoing Agreement is hereby accepted as of the date thereof.
SCUDDER, STEVENS & CLARK, INC.
By /s/ [Illegible]
----------------------------
Title:
10093328
SCUDDER FUND, INC.
345 Park Avenue
New York, New York 10154
May 1, 1989
Scudder, Stevens & Clark, Inc.
345 Park Avenue
New York, NY 10154
Investment Advisory Agreement
Managed Cash Fund
Dear Sirs:
Scudder Fund, Inc. (the "Corporation") has been organized under the
laws of the State of Maryland to engage in the business of an investment
company. The shares of capital stock of the Corporation ("Shares") are divided
into multiple series, including Managed Cash Fund (the "Fund"), as established
from time to time by action of the Directors of the Corporation. Series may be
terminated, and additional series established, from time to time by action of
the Directors. The Corporation, on behalf of the Fund, has selected you to act
as the sole investment adviser of the Fund and to provide certain other
services, as more fully set forth below, and you are willing to act as such
investment adviser and to perform such services under the terms and conditions
hereinafter set forth. Accordingly, the Corporation agrees with you as follows:
1. Delivery of Fund Documents. The Corporation has furnished
you with copies properly certified or authenticated of each of the following:
(a) Articles of Incorporation of the Corporation dated June 18,
1982, as amended from time to time (the "Articles");
(b) Appropriate evidence of the establishment of the Fund as a
series portfolio of the Corporation;
(c) By-Laws of the Corporation as in effect on the date hereof
(the "By-Laws");
<PAGE>
Scudder, Stevens
& Clark, Inc. 2 May 1, 1989
(d) Resolutions of the Directors of the Corporation selecting
you as investment adviser and approving the form of this
Agreement; and
(e) Properly certified or authenticated copies of the
Corporation's Registration Statement on Form N-1A filed by it
with the Securities and Exchange Commission under the
Securities Act of 1933, as amended, or the Investment Company
Act of 1940, as amended (the "Investment Company Act"),
together with any financial statements and exhibits included
therein.
The Corporation will furnish you from time to time with copies, properly
certified or authenticated, of all amendments of or supplements to the
foregoing, if any.
2. Name of Fund. The Fund may use any name derived from the name
"Scudder, Stevens & Clark", if it elects to do so, only for so long as this
Agreement, any other Investment Advisory Agreement between you and the
Corporation or any extension, renewal or amendment hereof or thereof remains in
effect, including any similar agreement with any organization which shall have
succeeded to your business as investment adviser. At such time as such an
agreement shall no longer be in effect, the Fund will (to the extent that it
lawfully can) cease to use such a name or any other name indicating that it is
advised by or otherwise connected with you or any organization which shall have
so succeeded to your business.
3. Advisory Services. You will regularly provide the Fund with
investment research, advice and supervision and will furnish continuously an
investment program for the Fund consistent with the investment objective and
policies of the Fund. You will determine what securities shall be purchased for
the Fund, what securities shall be held or sold by the Fund and what portion of
the Fund's assets shall be held uninvested, subject always to the provisions of
the Corporation's Articles and By-Laws and of the Investment Company Act, and to
the investment objective, policies and restrictions of the Fund, as each of the
same shall be from time
<PAGE>
Scudder, Stevens
& Clark, Inc. 3 May 1, 1989
to time in effect, and subject, further, to such policies and instructions as
the Board of Directors may from time to time establish. You shall advise and
assist the officers of the Fund in taking such steps as are necessary or
appropriate to carry out the decisions of the Board of Directors and the
appropriate committees of the Board of Directors regarding the conduct of the
business of the Fund.
4. Allocation of Charges and Expenses. You will pay the compensation
and expenses of all officers and executive employees of the Corporation who are
also employees or affiliates of you or your affiliates and will make available,
without expense to the Fund (except as otherwise provided below), the services
of such of your directors, officers and employees as are reasonably necessary
for the Fund's operations or as may duly be elected officers or directors of the
Corporation, subject to their individual consent to serve and to any limitations
imposed by law. You will pay the Fund's office rent and will provide investment
advisory research and statistical facilities and all clerical services relating
to research, statistical and investment work. You will not be required to pay
any expenses of the Fund other than those specifically allocated to you in this
paragraph 4. In particular, but without limiting the generality of the
foregoing, you will not be required to pay: organization expenses of the Fund;
clerical salaries; fees and expenses incurred by the Fund in connection with
membership in investment company organizations; brokerage and other expenses of
executing portfolio transactions; payment for portfolio pricing services to a
pricing agent, if any; legal, auditing or accounting expenses; trade association
dues; taxes or governmental fees; the fees and expenses of the transfer agent of
the Fund; the cost of preparing share certificates or any other expenses,
including clerical expenses of issue, redemption or repurchase of Shares of the
Fund; the expenses and fees for registering and qualifying securities for sale;
the fees and expenses of Directors of the Corporation who are not employees or
affiliates of you or your affiliates; travel expenses of all officers, directors
and employees; insurance premiums; the cost of preparing and distributing
reports and notices to shareholders; public and investor relations expenses or
the fees or disbursements of custodians of the Fund's
<PAGE>
Scudder, Stevens
& Clark, Inc. 4 May 1, 1989
assets, including expenses incurred in the performance of any obligations
enumerated by the Articles or By-Laws insofar as they govern agreements with any
such custodian. You shall not be required to pay expenses of any activity which
is primarily intended to result in sales of Shares of the Fund if and to the
extent that such expenses (i) are required to be borne by a principal
underwriter which acts as the distributor of the Fund's Shares pursuant to an
underwriting agreement which provides that the underwriter shall assume some or
all of such expenses, or (ii) the Corporation on behalf of the Fund shall have
adopted a plan in conformity with Rule 12b-1 under the Investment Company Act of
1940, as amended, providing that the Fund (or some other party) shall assume
some or all of such expenses. You shall be required to pay such of the foregoing
expenses as are not required to be paid by the principal underwriter pursuant to
the underwriting agreement or are not permitted to be paid by the Fund (or some
other party) pursuant to such a plan.
5. Compensation of the Adviser. For all services to be rendered and
payments made as provided in paragraphs 3 and 4 hereof, the Corporation on
behalf of the Fund will pay you on the last day of each month a gross fee which
is equal to the difference between (a) 1/12 of 0.40% of the value of the average
daily net assets of the Fund up to but not exceeding $1.5 billion for such month
and 1/12 of 0.35% of the value of the average daily net assets of the Fund in
excess of $1.5 billion for such month and (b) the sum, not in excess of the
amount determined under (a), of the amount waived by you from time to time plus
the amount by which the Fund's expenses exceed the lowest applicable expense
limitation (as more fully described herein).
(a) The "value of the average daily net assets" of the Fund is
defined as the average of the values placed on the net assets of the Fund
as of 12:00 noon (New York time), on each day on which the net asset value
of the Fund is determined consistent with the provisions of Rule 22c-1
under the Investment Company Act or, if the Fund lawfully determines the
value of the net assets of the Fund as of some other time on each business
day, as of such time. The value of the net assets of the Fund shall be
determined pursuant
<PAGE>
Scudder, Stevens
& Clark, Inc. 5 May 1, 1989
to the applicable provisions of the Articles. If, pursuant to such
provisions, the determination of the net asset value of the Fund is
suspended for any particular business day, then for the purposes of this
paragraph 5, the value of the net assets of the Fund as last determined
shall be deemed to be the value of the net assets of the Fund as of 12:00
noon or as of such other time as the value of the net assets of the Fund
may lawfully be determined, on that day. If the determination of the value
of the net assets of the Fund has been suspended pursuant to the Articles
for a period including such month, your compensation payable at the end of
such month shall be computed on the basis of the value of the net assets
of the Fund as last determined (whether during or prior to such month).
If the Fund determines the value of the net assets of its portfolio more
than once on any day, the last such determination thereof on that day
shall be deemed to be the sole determination thereof on that day for the
purposes of this paragraph 5.
(b) You agree that in determining your gross compensation for any
fiscal year it shall be reduced by the amount, if any, by which the
expenses of the Fund for such fiscal year exceed the lowest applicable
expense limitation established pursuant to the statutes or regulations of
any jurisdiction in which the Shares of the Fund may be qualified for
offer and sale. You shall refund to the Fund the amount of any reduction
of your compensation pursuant to this paragraph 5 as promptly as
practicable after the end of such fiscal year, provided that you will not
be required to pay the Fund an amount greater than the fee paid to you in
respect of such year pursuant to this Agreement. As used in this paragraph
5, "expenses" shall mean those expenses included in the applicable expense
limitation having the broadest specifications thereof, and "expense
limitation" means a limit on the maximum annual expenses which may be
incurred by an investment company determined (i) by multiplying a fixed
percentage by the average, or by multiplying more than one such percentage
by different specified amounts of the average, of the values of an
investment company's net assets for a fiscal year or (ii) by multiplying a
fixed percentage
<PAGE>
Scudder, Stevens
& Clark, Inc. 6 May 1, 1989
by an investment company's net investment income for a fiscal year. The
words "lowest applicable expense limitation" shall be construed to result
in the largest reduction of your compensation for any fiscal year of the
Fund; provided, however, that nothing in this Agreement shall require you
to reduce your fees if not required by an applicable statute or regulation
referred to above in this paragraph 5.
(c) You may waive all or a portion of your fees provided for
hereunder. To the extent that you agree to waive all or a portion of your
fees or to reimburse a portion of the Fund's expenses, you shall be
contractually bound by the publicly announced waivers or reimbursements.
6. Avoidance of Inconsistent Position. In connection with purchases
or sales of portfolio securities for the account of the Fund, neither you nor
any of your directors, officers or employees will act as a principal or agent or
receive any commission. You or your agent shall arrange for the placing of all
orders for the purchase and sale of portfolio securities for the Fund's account
with brokers or dealers selected by you. In the selection of such brokers or
dealers and the placing of such orders, you are directed at all times to seek
for the Fund the most favorable execution and net price available. If any
occasion should arise in which you give any advice to clients of yours
concerning the Shares of the Fund, you will act solely as investment counsel for
such clients and not in any way on behalf of the Fund. Your services to the Fund
pursuant to this Agreement are not to be deemed to be exclusive and it is
understood that you may render investment advice, management and other services
to others.
7. Limitation of Liability of Adviser. (a) You shall give the Fund
the benefit of your best judgment and efforts in rendering services under this
Agreement. As an inducement to your undertaking to render these services, the
Fund agrees that you shall not be liable under this Agreement for any mistake in
judgment or in any other event whatsoever except for lack of good faith,
provided that nothing in this Agreement shall be deemed to protect or purport to
protect you against any
<PAGE>
Scudder, Stevens
& Clark, Inc. 7 May 1, 1989
liability to the Fund or its shareholders to which you would otherwise be
subject by reason of willful misfeasance, bad faith or gross negligence in the
performance of your duties under this Agreement or by reason of your reckless
disregard of your duties and obligations hereunder.
(b) Notwithstanding anything herein to the contrary, you shall not
be liable or responsible for any acts or omissions of any predecessor manager or
investment adviser for the Fund or of any other persons having responsibility
for matters to which this Agreement relates prior to January 1, 1989, nor shall
you be responsible for reviewing any such acts or omissions. You shall, however,
be liable for your own acts and omissions subsequent to assuming responsibility
under this Agreement as herein provided.
8. Duration and Termination of this Agreement. This Agreement shall
remain in force until May 1, 1991 and from year to year thereafter, but only for
so long as such continuance is specifically approved at least annually (i) by
the vote of a majority of the Directors who are not interested persons of you or
of the Corporation, cast in person at a meeting called for the purpose of voting
on such approval, and (ii) by a vote of the Board of Directors or of a majority
of the outstanding voting securities of the Fund. The aforesaid requirement that
continuance of this Agreement be "specifically approved at least annually" shall
be construed in a manner consistent with the Investment Company Act and the
rules and regulations thereunder. This Agreement may, on 60 days' written
notice, be terminated at any time without the payment of any penalty, by the
Board of Directors, by vote of a majority of the outstanding voting securities
of the Fund, or by you. This Agreement shall automatically terminate in the
event of its assignment. In interpreting the provisions of this Agreement, the
definitions contained in Section 2(a) of the Investment Company Act
(particularly the definitions of "interested person," "assignment" and "majority
of the outstanding voting securities"), as from time to time amended, shall be
applied, subject, however, to such exemptions as may be granted by the
Securities and Exchange Commission by any rule, regulation or order.
<PAGE>
Scudder, Stevens
& Clark, Inc. 8 May 1, 1989
9. Amendment of this Agreement. No provisions of this Agreement may
be changed, waived, discharged or terminated orally, but only by an instrument
in writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought, and no amendment of this Agreement shall be
effective until approved by vote of the holders of a majority of the outstanding
voting securities of the Fund and by the Board of Directors, including a
majority of the Directors who are not interested persons of you or of the
Corporation, cast in person at a meeting called for the purpose of voting on
such approval.
10. Miscellaneous. 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. The
Agreement may be executed simultaneously in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
If you are in agreement with the foregoing, please sign the form of
acceptance on the accompanying counterpart of this letter and return such
counterpart to
<PAGE>
Scudder, Stevens
& Clark, Inc. 9 May 1, 1989
the Corporation, whereupon this letter shall become a binding contract.
Yours very truly,
SCUDDER FUND, INC.
on behalf of
Managed Cash Fund
By /s/ [Illegible]
------------------------
Title: Chairman
The foregoing Agreement is hereby accepted as of the date thereof.
SCUDDER, STEVENS & CLARK, INC.
By /s/ [Illegible]
-------------------------
Title:
10093327
SCUDDER FUND, INC.
345 Park Avenue
New York, New York 10154
May 1, 1989
Scudder, Stevens & Clark, Inc.
345 Park Avenue
New York, NY 10154
Investment Advisory Agreement
Managed Tax-Free Fund
Dear Sirs:
Scudder Fund, Inc. (the "Corporation") has been organized under the
laws of the State of Maryland to engage in the business of an investment
company. The shares of capital stock of the Corporation ("Shares") are divided
into multiple series, including Managed Tax-Free Fund (the "Fund"), as
established from time to time by action of the Directors of the Corporation.
Series may be terminated, and additional series established, from time to time
by action of the Directors. The Corporation, on behalf of the Fund, has selected
you to act as the sole investment adviser of the Fund and to provide certain
other services, as more fully set forth below, and you are willing to act as
such investment adviser and to perform such services under the terms and
conditions hereinafter set forth. Accordingly, the Corporation agrees with you
as follows:
1. Delivery of Fund Documents. The Corporation has furnished you
with copies properly certified or authenticated of each of the following:
(a) Articles of Incorporation of the Corporation dated June 18,
1982, as amended from time to time (the "Articles");
(b) Appropriate evidence of the establishment of the Fund as a
series portfolio of the Corporation;
(c) By-Laws of the Corporation as in effect on the date hereof
(the "By-Laws");
<PAGE>
Scudder, Stevens
& Clark, Inc. 2 May 1, 1989
(d) Resolutions of the Directors of the Corporation selecting you
as investment adviser and approving the form of this
Agreement; and
(e) Properly certified or authenticated copies of the
Corporation's Registration Statement on Form N-1A filed by it
with the Securities and Exchange Commission under the
Securities Act of 1933, as amended, or the Investment Company
Act of 1940, as amended (the "Investment Company Act"),
together with any financial statements and exhibits included
therein.
The Corporation will furnish you from time to time with copies, properly
certified or authenticated, of all amendments of or supplements to the
foregoing, if any.
2. Name of Fund. The Fund may use any name derived from the name
"Scudder, Stevens & Clark", if it elects to do so, only for so long as this
Agreement, any other Investment Advisory Agreement between you and the
Corporation or any extension, renewal or amendment hereof or thereof remains in
effect, including any similar agreement with any organization which shall have
succeeded to your business as investment adviser. At such time as such an
agreement shall no longer be in effect, the Fund will (to the extent that it
lawfully can) cease to use such a name or any other name indicating that it is
advised by or otherwise connected with you or any organization which shall have
so succeeded to your business.
3. Advisory Services. You will regularly provide the Fund with
investment research, advice and supervision and will furnish continuously an
investment program for the Fund consistent with the investment objective and
policies of the Fund. You will determine what securities shall be purchased for
the Fund, what securities shall be held or sold by the Fund and what portion of
the Fund's assets shall be held uninvested, subject always to the provisions of
the Corporation's Articles and By-Laws and of the Investment Company Act, and to
the investment objective, policies and restrictions of the Fund, as each of the
same shall be from time
<PAGE>
Scudder, Stevens
& Clark, Inc. 3 May 1, 1989
to time in effect, and subject, further, to such policies and instructions as
the Board of Directors may from time to time establish. You shall advise and
assist the officers of the Fund in taking such steps as are necessary or
appropriate to carry out the decisions of the Board of Directors and the
appropriate committees of the Board of Directors regarding the conduct of the
business of the Fund.
4. Allocation of Charges and Expenses. You will pay the compensation
and expenses of all officers and executive employees of the Corporation who are
also employees or affiliates of you or your affiliates and will make available,
without expense to the Fund (except as otherwise provided below), the services
of such of your directors, officers and employees as are reasonably necessary
for the Fund's operations or as may duly be elected officers or directors of the
Corporation, subject to their individual consent to serve and to any limitations
imposed by law. You will pay the Fund's office rent and will provide investment
advisory research and statistical facilities and all clerical services relating
to research, statistical and investment work. You will not be required to pay
any expenses of the Fund other than those specifically allocated to you in this
paragraph 4. In particular, but without limiting the generality of the
foregoing, you will not be required to pay: organization expenses of the Fund;
clerical salaries; fees and expenses incurred by the Fund in connection with
membership in investment company organizations; brokerage and other expenses of
executing portfolio transactions; payment for portfolio pricing services to a
pricing agent, if any; legal, auditing or accounting expenses; trade association
dues; taxes or governmental fees; the fees and expenses of the transfer agent of
the Fund; the cost of preparing share certificates or any other expenses,
including clerical expenses of issue, redemption or repurchase of Shares of the
Fund; the expenses and fees for registering and qualifying securities for sale;
the fees and expenses of Directors of the Corporation who are not employees or
affiliates of you or your affiliates; travel expenses of all officers, directors
and employees; insurance premiums; the cost of preparing and distributing
reports and notices to shareholders; public and investor relations expenses or
the fees or disbursements of custodians of the Fund's
<PAGE>
Scudder, Stevens
& Clark, Inc. 4 May 1, 1989
assets, including expenses incurred in the performance of any obligations
enumerated by the Articles or By-Laws insofar as they govern agreements with any
such custodian. You shall not be required to pay expenses of any activity which
is primarily intended to result in sales of Shares of the Fund if and to the
extent that such expenses (i) are required to be borne by a principal
underwriter which acts as the distributor of the Fund's Shares pursuant to an
underwriting agreement which provides that the underwriter shall assume some or
all of such expenses, or (ii) the Corporation on behalf of the Fund shall have
adopted a plan in conformity with Rule 12b-1 under the Investment Company Act
of l940, as amended, providing that the Fund (or some other party) shall assume
some or all of such expenses. You shall be required to pay such of the foregoing
expenses as are not required to be paid by the principal underwriter pursuant to
the underwriting agreement or are not permitted to be paid by the Fund (or some
other party) pursuant to such a plan.
5. Compensation of the Adviser. For all services to be rendered and
payments made as provided in paragraphs 3 and 4 hereof, the Corporation on
behalf of the Fund will pay you on the last day of each month a gross fee which
is equal to the difference between (a) 1/12 of 0.40% of the value of the average
daily net assets of the Fund up to but not exceeding $1.5 billion for such month
and 1/12 of 0.35% of the value of the average daily net assets of the Fund in
excess of $1.5 billion for such month and (b) the sum, not in excess of the
amount determined under (a), of the amount waived by you from time to time plus
the amount by which the Fund's expenses exceed the lowest applicable expense
limitation (as more fully described herein).
(a) The "value of the average daily net assets" of the Fund is
defined as the average of the values placed on the net assets
of the Fund as of 12:00 noon (New York time), on each day on
which the net asset value of the Fund is determined consistent
with the provisions of Rule 22c-1 under the Investment Company
Act or, if the Fund lawfully determines the value of the net
assets of the Fund as of some other time on each business day,
as of such time. The value of the net assets of the Fund shall
be determined pursuant
<PAGE>
Scudder, Stevens
& Clark, Inc. 5 May 1, 1989
to the applicable provisions of the Articles. If, pursuant to
such provisions, the determination of the net asset value of
the Fund is suspended for any particular business day, then
for the purposes of this paragraph 5, the value of the net
assets of the Fund as last determined shall be deemed to be
the value of the net assets of the Fund as of 12:00 noon or as
of such other time as the value of the net assets of the Fund
may lawfully be determined, on that day. If the determination
of the value of the net assets of the Fund has been suspended
pursuant to the Articles for a period including such month,
your compensation payable at the end of such month shall be
computed on the basis of the value of the net assets of the
Fund as last determined (whether during or prior to such
month). If the Fund determines the value of the net assets of
its portfolio more than once on any day, the last such
determination thereof on that day shall be deemed to be the
sole determination thereof on that day for the purposes of
this paragraph 5.
(b) You agree that in determining your gross compensation for any
fiscal year it shall be reduced by the amount, if any, by
which the expenses of the Fund for such fiscal year exceed the
lowest applicable expense limitation established pursuant to
the statutes or regulations of any jurisdiction in which the
Shares of the Fund may be qualified for offer and sale. You
shall refund to the Fund the amount of any reduction of your
compensation pursuant to this paragraph 5 as promptly as
practicable after the end of such fiscal year, provided that
you will not be required to pay the Fund an amount greater
than the fee paid to you in respect of such year pursuant to
this Agreement. As used in this paragraph 5, "expenses" shall
mean those expenses included in the applicable expense
limitation having the broadest specifications thereof, and
"expense limitation" means a limit on the maximum annual
expenses which may be incurred by an investment company
determined (i) by multiplying a fixed percentage by the
average, or by multiplying more than one such percentage by
different specified amounts of the average, of the values of
an investment company's net assets for a fiscal year or (ii)
by multiplying a fixed percentage
<PAGE>
Scudder, Stevens
& Clark, Inc. 6 May 1, 1989
by an investment company's net investment income for a fiscal
year. The words "lowest applicable expense limitation" shall
be construed to result in the largest reduction of your
compensation for any fiscal year of the Fund; provided,
however, that nothing in this Agreement shall require you to
reduce your fees if not required by an applicable statute or
regulation referred to above in this paragraph 5.
(c) You may waive all or a portion of your fees provided for
hereunder. To the extent that you agree to waive all or a
portion of your fees or to reimburse a portion of the Fund's
expenses, you shall be contractually bound by the publicly
announced waivers or reimbursements.
6. Avoidance of Inconsistent Position. In connection with purchases
or sales of portfolio securities for the account of the Fund, neither you nor
any of your directors, officers or employees will act as a principal or agent or
receive any commission. You or your agent shall arrange for the placing of all
orders for the purchase and sale of portfolio securities for the Fund's account
with brokers or dealers selected by you. In the selection of such brokers or
dealers and the placing of such orders, you are directed at all times to seek
for the Fund the most favorable execution and net price available. If any
occasion should arise in which you give any advice to clients of yours
concerning the Shares of the Fund, you will act solely as investment counsel for
such clients and not in any way on behalf of the Fund. Your services to the Fund
pursuant to this Agreement are not to be deemed to be exclusive and it is
understood that you may render investment advice, management and other services
to others.
7. Limitation of Liability of Adviser. (a) You shall give the Fund
the benefit of your best judgment and efforts in rendering services under this
Agreement. As an inducement to your undertaking to render these services, the
Fund agrees that you shall not be liable under this Agreement for any mistake in
judgment or in any other event whatsoever except for lack of good faith,
provided that nothing in this Agreement shall be deemed to protect or purport to
protect you against any
<PAGE>
Scudder, Stevens
& Clark, Inc. 7 May 1, 1989
liability to the Fund or its shareholders to which you would otherwise be
subject by reason of willful misfeasance, bad faith or gross negligence in the
performance of your duties under this Agreement or by reason of your reckless
disregard of your duties and obligations hereunder.
(b) Notwithstanding anything herein to the contrary, you shall not
be liable or responsible for any acts or omissions of any predecessor manager or
investment adviser for the Fund or of any other persons having responsibility
for matters to which this Agreement relates prior to January 1, 1989, nor shall
you be responsible for reviewing any such acts or omissions. You shall, however,
be liable for your own acts and omissions subsequent to assuming responsibility
under this Agreement as herein provided.
8. Duration and Termination of this Agreement. This Agreement shall
remain in force until May 1, 1991 and from year to year thereafter, but only for
so long as such continuance is specifically approved at least annually (i) by
the vote of a majority of the Directors who are not interested persons of you or
of the Corporation, cast in person at a meeting called for the purpose of voting
on such approval, and (ii) by a vote of the Board of Directors or of a majority
of the outstanding voting securities of the Fund. The aforesaid requirement that
continuance of this Agreement be "specifically approved at least annually" shall
be construed in a manner consistent with the Investment Company Act and the
rules and regulations thereunder. This Agreement may, on 60 days' written
notice, be terminated at any time without the payment of any penalty, by the
Board of Directors, by vote of a majority of the outstanding voting securities
of the Fund, or by you. This Agreement shall automatically terminate in the
event of its assignment. In interpreting the provisions of this Agreement, the
definitions contained in Section 2(a) of the Investment Company Act
(particularly the definitions of "interested person," "assignment" and "majority
of the outstanding voting securities"), as from time to time amended, shall be
applied, subject, however, to such exemptions as may be granted by the
Securities and Exchange Commission by any rule, regulation or order.
<PAGE>
Scudder, Stevens
& Clark, Inc. 8 May 1, 1989
9. Amendment of this Agreement. No provisions of this Agreement may
be changed, waived, discharged or terminated orally, but only by an instrument
in writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought, and no amendment of this Agreement shall be
effective until approved by vote of the holders of a majority of the outstanding
voting securities of the Fund and by the Board of Directors, including a
majority of the Directors who are not interested persons of you or of the
Corporation, cast in person at a meeting called for the purpose of voting on
such approval.
10. Miscellaneous. 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. The
Agreement may be executed simultaneously in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
If you are in agreement with the foregoing, please sign the form of
acceptance on the accompanying counterpart of this letter and return such
counterpart to
<PAGE>
Scudder, Stevens
& Clark, Inc. 9 May 1, 1989
the Corporation, whereupon this letter shall become a binding contract.
Yours very truly,
SCUDDER FUND, INC.
on behalf of
Managed Tax-Free Fund
By /s/ [Illegible]
---------------------
Title: Chairman
The foregoing Agreement is hereby accepted as of the date thereof.
SCUDDER, STEVENS & CLARK, INC.
By /s/ [Illegible]
----------------------
Title:
SCUDDER FUND, INC.
345 Park Avenue
New York, New York 10154
May 1, 1991
Scudder, Stevens & Clark, Inc.
345 Park Avenue
New York, NY 10154
Investment Advisory Agreement
Managed Federal Fund
Dear Sirs:
Scudder Fund, Inc. (the "Corporation") has been organized under the
laws of the State of Maryland to engage in the business of an investment
company. The shares of capital stock of the Corporation ("Shares") are divided
into multiple series, including Managed Federal Fund (the "Fund"), as
established from time to time by action of the Directors of the Corporation.
Series may be terminated, and additional series established, from time to time
by action of the Directors. The Corporation, on behalf of the Fund, has selected
you to act as the sole investment adviser of the Fund and to provide certain
other services, as more fully set forth below, and you are willing to act as
such investment adviser and to perform such services under the terms and
conditions hereinafter set forth. Accordingly, the Corporation agrees with you
as follows:
1. Delivery of Fund Documents. The Corporation has furnished you
with copies properly certified or authenticated of each of the following:
(a) Articles of Incorporation of the Corporation dated June 18, 1982, as
amended from time to time (the "Articles");
<PAGE>
Scudder, Stevens & Clark, Inc. -2-
(b) Appropriate evidence of the establishment of the Fund as a series
portfolio of the Corporation;
(c) By-Laws of the Corporation as in effect on the date hereof
(the "By-Laws");
(d) Resolutions of the Directors of the Corporation selecting
you as investment adviser and approving the form of this
Agreement; and
(e) Properly certified or authenticated copies of the Corporation's
Registration Statement on Form N-1A filed by it with the Securities
and Exchange Commission under the Securities Act of 1933, as
amended, or the Investment Company Act of 1940, as amended (the
"Investment Company Act"), together with any financial statements
and exhibits included therein.
The Corporation will furnish you from time to time with copies, properly
certified or authenticated, of all amendments of or supplements to the
foregoing, if any.
2. Name of Fund. The Fund may use any name derived from the name
"Scudder, Stevens & Clark", if it elects to do so, only for so long as this
Agreement, any other Investment Advisory Agreement between you and the
Corporation or any extension, renewal or amendment hereof or thereof remains in
effect, including any similar agreement with any organization which shall have
succeeded to your business as investment adviser. At such time as such an
agreement shall no longer be in effect, the Fund will (to the extent that it
lawfully can) cease to use such a name or any other name indicating that it is
advised by or otherwise connected with you or any organization which shall have
so succeeded to your business.
3. Advisory Services. You will regularly provide the Fund with
investment research, advice and supervision and will furnish continuously an
investment program for the Fund consistent with the investment objective and
policies of the Fund. You will determine what securities shall be purchased for
the Fund, what securities shall be
<PAGE>
Scudder, Stevens & Clark, Inc. -3-
held or sold by the Fund and what portion of the Fund's assets shall be held
uninvested, subject always to the provisions of the Corporation's Articles and
By-Laws and of the Investment Company Act, and to the investment objective,
policies and restrictions of the Fund, as each of the same shall be from time to
time in effect, and subject, further, to such policies and instructions as the
Board of Directors may from time to time establish. You shall advise and assist
the officers of the Fund in taking such steps as are necessary or appropriate to
carry out the decisions of the Board of Directors and the appropriate committees
of the Board of Directors regarding the conduct of the business of the Fund.
4. Allocation of Charges and Expenses. You will pay the compensation
and expenses of all officers and executive employees of the Corporation who are
also employees or affiliates of you or your affiliates and will make available,
without expense to the Fund (except as otherwise provided below), the services
of such of your directors, officers and employees as are reasonably necessary
for the Fund's operations or as may duly be elected officers or directors of the
Corporation, subject to their individual consent to serve and to any limitations
imposed by law. You will pay the Fund's office rent and will provide investment
advisory research and statistical facilities and all clerical services relating
to research, statistical and investment work. You will not be required to pay
any expenses of the Fund other than those specifically allocated to you in this
paragraph 4. In particular, but without limiting the generality of the
foregoing, you will not be required to pay: organization expenses of the Fund;
clerical salaries; fees and expenses incurred by the Fund in connection with
membership in investment company organizations; brokerage and other expenses of
executing portfolio transactions; payment for portfolio pricing services to a
pricing agent, if any; legal, auditing or accounting expenses; trade association
dues; taxes or governmental fees; the fees and expenses of the transfer agent of
the Fund; the cost of preparing share certificates or any other expenses,
including clerical expenses of issue, redemption or repurchase of Shares of the
Fund; the expenses and fees for registering and qualifying securities for sale;
the fees and expenses of Directors of the Corporation who are not employees or
affiliates of you or your affiliates; travel expenses of all officers, directors
and employees; insurance premiums; the cost of preparing and distributing
reports and
<PAGE>
Scudder, Stevens & Clark, Inc. -4-
notices to shareholders; public and investor relations expenses or the fees or
disbursements of custodians of the Fund's assets, including expenses incurred in
the performance of any obligations enumerated by the Articles or By-Laws insofar
as they govern agreements with any such custodian. You shall not be required to
pay expenses of any activity which is primarily intended to result in sales of
Shares of the Fund if and to the extent that such expenses (i) are required to
be borne by a principal underwriter which acts as the distributor of the Fund's
Shares pursuant to an underwriting agreement which provides that the underwriter
shall assume some or all of such expenses, or (ii) if the Corporation on behalf
of the Fund shall have adopted a plan in conformity with Rule 12b-1 under the
Investment Company Act providing that the Fund (or some other party) shall
assume some or all of such expenses. You shall be required to pay such of the
foregoing expenses as are not required to be paid by the principal underwriter
pursuant to the underwriting agreement or are not permitted to be paid by the
Fund (or some other party) pursuant to such a plan.
5. Compensation of the Adviser. For all services to be rendered and
payments made as provided in paragraphs 3 and 4 hereof, the Corporation on
behalf of the Fund will pay you on the last day of each month a gross fee which
is equal to the difference between (a) 1/12 of 0.40% of the value of the average
daily net assets of the Fund up to but not exceeding $1.5 billion for such month
and 1/12 of 0.35% of the value of the average daily net assets of the Fund in
excess of $1.5 billion for such month and (b) the sum, not in excess of the
amount determined under (a), of the amount waived by you from time to time plus
the amount by which the Fund's expenses exceed the lowest applicable expense
limitation (as more fully described herein).
(a) The "value of the average daily net assets" of the Fund is
defined as the average of the values placed on the net assets of the Fund
as of 12:00 noon (New York time), on each day on which the net asset value
of the Fund is determined consistent with the provisions of Rule 22c-1
under the Investment Company Act or, if the Fund lawfully determines the
value of the net assets of the Fund as of some other time on each business
day, as of such time. The value of the net assets of the Fund shall be
determined pursuant to the applicable provisions of the Articles. If,
<PAGE>
Scudder, Stevens & Clark, Inc. -5-
pursuant to such provisions, the determination of the net asset value of
the Fund is suspended for any particular business day, then for the
purposes of this paragraph 5, the value of the net assets of the Fund as
last determined shall be deemed to be the value of the net assets of the
Fund as of 12:00 noon or as of such other time as the value of the net
assets of the Fund may lawfully be determined, on that day. If the
determination of the value of the net assets of the Fund has been
suspended pursuant to the Articles for a period including such month, your
compensation payable at the end of such month shall be computed on the
basis of the value of the net assets of the Fund as last determined
(whether during or prior to such month). If the Fund determines the value
of the net assets of its portfolio more than once on any day, the last
such determination thereof on that day shall be deemed to be the sole
determination thereof on that day for the purposes of this paragraph 5.
(b) You agree that in determining your gross compensation for any
fiscal year it shall be reduced by the amount, if any, by which the
expenses of the Fund for such fiscal year exceed the lowest applicable
expense limitation established pursuant to the statutes or regulations of
any jurisdiction in which the Shares of the Fund may be qualified for
offer and sale. You shall refund to the Fund the amount of any reduction
of your compensation pursuant to this paragraph 5 as promptly as
practicable after the end of such fiscal year, provided that you will not
be required to pay the Fund an amount greater than the fee paid to you in
respect of such year pursuant to this Agreement. As used in this paragraph
5, "expenses" shall mean those expenses included in the applicable expense
limitation having the broadest specifications thereof, and "expense
limitation" means a limit on the maximum annual expenses which may be
incurred by an investment company determined (i) by multiplying a fixed
percentage by the average, or by multiplying more than one such percentage
by different specified amounts of the average, of the values of an
investment company's net assets for a fiscal
<PAGE>
Scudder, Stevens & Clark, Inc. -6-
year or (ii) by multiplying a fixed percentage by an investment company's
net investment income for a fiscal year. The words "lowest applicable
expense limitation" shall be construed to result in the largest reduction
of your compensation for any fiscal year of the Fund; provided, however,
that nothing in this Agreement shall require you to reduce your fees if
not required by an applicable statute or regulation referred to above in
this paragraph 5.
(c) You may waive all or a portion of your fees provided for
hereunder. To the extent that you agree to waive all or a portion of your
fees or to reimburse a portion of the Fund's expenses, you shall be
contractually bound by the publicly announced waivers or reimbursements.
6. Avoidance of Inconsistent Position. In connection with purchases
or sales of portfolio securities for the account of the Fund, neither you nor
any of your directors, officers or employees will act as a principal or agent or
receive any commission. You or your agent shall arrange for the placing of all
orders for the purchase and sale of portfolio securities for the Fund's account
with brokers or dealers selected by you. In the selection of such brokers or
dealers and the placing of such orders, you are directed at all times to seek
for the Fund the most favorable execution and net price available. If any
occasion should arise in which you give any advice to clients of yours
concerning the Shares of the Fund, you will act solely as investment counsel for
such clients and not in any way on behalf of the Fund. Your services to the Fund
pursuant to this Agreement are not to be deemed to be exclusive and it is
understood that you may render investment advice, management and other services
to others.
7. Limitation of Liability of Adviser. You shall give the Fund the
benefit of your best judgment and efforts in rendering services under this
Agreement. As an inducement to your undertaking to render these services, the
Fund agrees that you shall not be liable under this Agreement for any mistake in
judgment or in any other event whatsoever except for lack of good faith,
provided that nothing in this Agreement shall be deemed to protect or purport to
protect you against any liability to the Fund or its shareholders to which you
would otherwise be subject by
<PAGE>
Scudder, Stevens & Clark, Inc. -7-
reason of willful misfeasance, bad faith or gross negligence in the performance
of your duties under this Agreement or by reason of your reckless disregard of
your duties and obligations hereunder.
8. Duration and Termination of this Agreement. This Agreement shall
remain in force until May 1, 1993 and from year to year thereafter, but only for
so long as such continuance is specifically approved at least annually (i) by
the vote of a majority of the Directors who are not interested persons of you or
of the Corporation, cast in person at a meeting called for the purpose of voting
on such approval, and (ii) by a vote of the Board of Directors or of a majority
of the outstanding voting securities of the Fund. The aforesaid requirement that
continuance of this Agreement be "specifically approved at least annually" shall
be construed in a manner consistent with the Investment Company Act and the
rules and regulations thereunder. This Agreement may, on 60 days' written
notice, be terminated at any time without the payment of any penalty, by the
Board of Directors, by vote of a majority of the outstanding voting securities
of the Fund, or by you. This Agreement shall automatically terminate in the
event of its assignment. In interpreting the provisions of this Agreement, the
definitions contained in Section 2(a) of the Investment Company Act
(particularly the definitions of "interested person," "assignment" and "majority
of the outstanding voting securities"), as from time to time amended, shall be
applied, subject, however, to such exemptions as may be granted by the
Securities and Exchange Commission by any rule, regulation or order.
9. Amendment of this Agreement. No provisions of this Agreement may
be changed, waived, discharged or terminated orally, but only by an instrument
in writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought, and no amendment of this Agreement shall be
effective until approved by vote of the holders of a majority of the outstanding
voting securities of the Fund and by the Board of Directors, including a
majority of the Directors who are not interested persons of you or of the
Corporation, cast in person at a meeting called for the purpose of voting on
such approval.
10. Miscellaneous. 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
<PAGE>
Scudder, Stevens & Clark, Inc. -8-
otherwise affect their construction or effect. The Agreement may be executed
simultaneously in two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.
If you are in agreement with the foregoing, please sign the form
of acceptance on the accompanying counterpart of this letter and return such
counterpart to the Corporation, whereupon this letter shall become a binding
contract.
Yours very truly,
SCUDDER FUND, INC.
of behalf of
Managed Federal Fund
By______________________________
Title:
The foregoing Agreement is hereby accepted as of the date thereof.
SCUDDER, STEVENS & CLARK, INC.
By______________________________
Title:
Exhibit 5(a)(v)
<PAGE>
SCUDDER FUND, INC.
345 Park Avenue
New York, New York 10154
January 18, 1993
Scudder, Stevens & Clark, Inc.
345 Park Avenue
New York, NY 10154
Investment Advisory Agreement
Managed Intermediate Government Fund
Dear Sirs:
Scudder Fund, Inc. (the "Corporation") has been organized under the
laws of the State of Maryland to engage in the business of an investment
company. The shares of capital stock of the Corporation ("Shares") are divided
into multiple series, including Managed Intermediate Government Fund (the
"Fund"), as established from time to time by action of the Directors of the
Corporation. Series may be terminated, and additional series established, from
time to time by action of the Directors. The Corporation, on behalf of the Fund,
has selected you to act as the sole investment adviser of the Fund and to
provide certain other services, as more fully set forth below, and you are
willing to act as such investment adviser and to perform such services under the
terms and conditions hereinafter set forth. Accordingly, the Corporation agrees
with you as follows:
1. Delivery of Fund Documents. The Corporation has furnished you
with copies properly certified or authenticated of each of the following:
(a) Articles of Incorporation of the Corporation dated June 18,
1982, as amended from time to time (the "Articles");
(b) Appropriate evidence of the establishment of the Fund as a
series portfolio of the Corporation;
(c) By-Laws of the Corporation as in effect on the date hereof
(the "By-Laws");
<PAGE>
Scudder, Stevens & Clark, Inc. -2-
(d) Resolutions of the Directors of the Corporation selecting you
as investment adviser and approving the form of this
Agreement; and
(e) Properly certified or authenticated copies of the
Corporation's Registration Statement on Form N-1A filed by it
with the Securities and Exchange Commission under the
Securities Act of 1933, as amended, or the Investment Company
Act of 1940, as amended (the "Investment Company Act"),
together with any financial statements and exhibits included
therein.
The Corporation will furnish you from time to time with copies, properly
certified or authenticated, of all amendments of or supplements to the
foregoing, if any.
2. Name of Fund. The Fund may use any name derived from the name
"Scudder, Stevens & Clark", if it elects to do so, only for so long as this
Agreement, any other Investment Advisory Agreement between you and the
Corporation or any extension, renewal or amendment hereof or thereof remains in
effect, including any similar agreement with any organization which shall have
succeeded to your business as investment adviser. At such time as such an
agreement shall no longer be in effect, the Fund will (to the extent that it
lawfully can) cease to use such a name or any other name indicating that it is
advised by or otherwise connected with you or any organization which shall have
so succeeded to your business.
3. Advisory Services. You will regularly provide the Fund with
investment research, advice and supervision and will furnish continuously an
investment program for the Fund consistent with the investment objective and
policies of the Fund. You will determine what securities shall be purchased for
the Fund, what securities shall be held or sold by the Fund and what portion of
the Fund's assets shall be held uninvested, subject always to the provisions of
the Corporation's Articles and By-Laws and of the Investment Company Act, and to
the investment objective, policies and restrictions of the Fund, as each of the
same shall be from time to time in effect, and subject, further, to such
policies and instructions as the Board of Directors may from time to time
establish. You shall advise and assist the officers of the Fund in taking such
steps as are necessary or appropriate to carry out the decisions of the Board of
Directors and the appropriate committees of the
<PAGE>
Scudder, Stevens & Clark, Inc. -3-
Board of Directors regarding the conduct of the business of the Fund.
4. Allocation of Charges and Expenses. You will pay the compensation
and expenses of all officers and executive employees of the Corporation who are
also employees or affiliates of you or your affiliates and will make available,
without expense to the Fund (except as otherwise provided below), the services
of such of your directors, officers and employees as are reasonably necessary
for the Fund's operations or as may duly be elected officers or directors of the
Corporation, subject to their individual consent to serve and to any limitations
imposed by law. You will pay the Fund's office rent and will provide investment
advisory research and statistical facilities and all clerical services relating
to research, statistical and investment work. You will not be required to pay
any expenses of the Fund other than those specifically allocated to you in this
paragraph 4. In particular, but without limiting the generality of the
foregoing, you will not be required to pay: organization expenses of the Fund;
clerical salaries; fees and expenses incurred by the Fund in connection with
membership in investment company organizations; brokerage and other expenses of
executing portfolio transactions; payment for portfolio pricing services to a
pricing agent, if any; legal, auditing or accounting expenses; trade association
dues; taxes or governmental fees; the fees and expenses of the transfer agent of
the Fund; the cost of preparing share certificates or any other expenses,
including clerical expenses of issue, redemption or repurchase of Shares of the
Fund; the expenses and fees for registering and qualifying securities for sale;
the fees and expenses of Directors of the Corporation who are not employees or
affiliates of you or your affiliates; travel expenses of all officers, directors
and employees; insurance premiums; the cost of preparing and distributing
reports and notices to shareholders; public and investor relations expenses or
the fees or disbursements of custodians of the Fund's assets, including expenses
incurred in the performance of any obligations enumerated by the Articles or
By-Laws insofar as they govern agreements with any such custodian. You shall not
be required to pay expenses of any activity which is primarily intended to
result in sales of Shares of the Fund if and to the extent that such expenses
(i) are required to be borne by a principal underwriter which acts as the
distributor of the Fund's Shares pursuant to an underwriting agreement which
provides that the underwriter shall assume some or all of such expenses, or (ii)
if the Corporation on behalf of the Fund shall have adopted a plan in conformity
with Rule 12b-1 under the Investment Company Act providing that the Fund (or
some other party) shall assume some or all of such expenses. You shall be
<PAGE>
Scudder, Stevens & Clark, Inc. -4-
required to pay such of the foregoing expenses as are not required to be paid by
the principal underwriter pursuant to the underwriting agreement or are not
permitted to be paid by the Fund (or some other party) pursuant to such a plan.
5. Compensation of the Adviser. For all services to be rendered and
payments made as provided in paragraphs 3 and 4 hereof, the Corporation on
behalf of the Fund will pay you on the last day of each month a gross fee which
is equal to the difference between (a) 1/12 of 0.65% of the value of the average
daily net assets of the Fund for such month and (b) the sum, not in excess of
the amount determined under (a), of the amount waived by you from time to time
plus the amount by which the Fund's expenses exceed the lowest applicable
expense limitation (as more fully described herein).
(a) The "value of the average daily net assets" of the Fund is
defined as the average of the values placed on the net assets of the Fund
as of the close of regular trading on the NYSE, which is currently 4:00
P.M. (New York time), on each day on which the net asset value of the Fund
is determined consistent with the provisions of Rule 22c-1 under the
Investment Company Act or, if the Fund lawfully determines the value of
the net assets of the Fund as of some other time on each business day, as
of such time. The value of the net assets of the Fund shall be determined
pursuant to the applicable provisions of the Articles. If, pursuant to
such provisions, the determination of the net asset value of the Fund is
suspended for any particular business day, then for the purposes of this
paragraph 5, the value of the net assets of the Fund as last determined
shall be deemed to be the value of the net assets of the Fund as of 4:00
P.M. or as of such other time as the value of the net assets of the Fund
may lawfully be determined, on that day. If the determination of the value
of the net assets of the Fund has been suspended pursuant to the Articles
for a period including such month, your compensation payable at the end of
such month shall be computed on the basis of the value of the net assets
of the Fund as last determined (whether during or prior to such month). If
the Fund determines the value of the net assets of its portfolio more than
once on any day, the last such determination thereof on that day shall be
deemed to be the sole determination thereof on that day for the purposes
of this paragraph 5.
<PAGE>
Scudder, Stevens & Clark, Inc. -5-
(b) You agree that in determining your gross compensation for any
fiscal year it shall be reduced by the amount, if any, by which the
expenses of the Fund for such fiscal year exceed the lowest applicable
expense limitation established pursuant to the statutes or regulations of
any jurisdiction in which the Shares of the Fund may be qualified for
offer and sale. You shall refund to the Fund the amount of any reduction
of your compensation pursuant to this paragraph 5 as promptly as
practicable after the end of such fiscal year, provided that you will not
be required to pay the Fund an amount greater than the fee paid to you in
respect of such year pursuant to this Agreement. As used in this paragraph
5, "expenses" shall mean those expenses included in the applicable expense
limitation having the broadest specifications thereof, and "expense
limitation" means a limit on the maximum annual expenses which may be
incurred by an investment company determined (i) by multiplying a fixed
percentage by the average, or by multiplying more than one such percentage
by different specified amounts of the average, of the values of an
investment company's net assets for a fiscal year or (ii) by multiplying a
fixed percentage by an investment company's net investment income for a
fiscal year. The words "lowest applicable expense limitation" shall be
construed to result in the largest reduction of your compensation for any
fiscal year of the Fund; provided, however, that nothing in this Agreement
shall require you to reduce your fees if not required by an applicable
statute or regulation referred to above in this paragraph 5.
(c) You may waive all or a portion of your fees provided for
hereunder. To the extent that you agree to waive all or a portion of your
fees or to reimburse a portion of the Fund's expenses, you shall be
contractually bound by the publicly announced waivers or reimbursements.
6. Avoidance of Inconsistent Position. In connection with purchases
or sales of portfolio securities for the account of the Fund, neither you nor
any of your directors, officers or employees will act as a principal or agent or
receive any commission. You or your agent shall arrange for the placing of all
orders for the purchase and sale of portfolio securities for the Fund's account
with brokers or dealers selected by you. In the selection of such brokers or
dealers and the placing of such orders, you
<PAGE>
Scudder, Stevens & Clark, Inc. -6-
are directed at all times to seek for the Fund the most favorable execution and
net price available. If any occasion should arise in which you give any advice
to clients of yours concerning the Shares of the Fund, you will act solely as
investment counsel for such clients and not in any way on behalf of the Fund.
Your services to the Fund pursuant to this Agreement are not to be deemed to be
exclusive and it is understood that you may render investment advice, management
and other services to others.
7. Limitation of Liability of Adviser. You shall give the Fund the
benefit of your best judgment and efforts in rendering services under this
Agreement. As an inducement to your undertaking to render these services, the
Fund agrees that you shall not be liable under this Agreement for any mistake in
judgment or in any other event whatsoever except for lack of good faith,
provided that nothing in this Agreement shall be deemed to protect or purport to
protect you against any liability to the Fund or its shareholders to which you
would otherwise be subject by reason of willful misfeasance, bad faith or gross
negligence in the performance of your duties under this Agreement or by reason
of your reckless disregard of your duties and obligations hereunder.
8. Duration and Termination of this Agreement. This Agreement shall
remain in force until January 18, 1995 and from year to year thereafter, but
only for so long as such continuance is specifically approved at least annually
(i) by the vote of a majority of the Directors who are not interested persons of
you or of the Corporation, cast in person at a meeting called for the purpose of
voting on such approval, and (ii) by a vote of the Board of Directors or of a
majority of the outstanding voting securities of the Fund. The aforesaid
requirement that continuance of this Agreement be "specifically approved at
least annually" shall be construed in a manner consistent with the Investment
Company Act and the rules and regulations thereunder. This Agreement may, on 60
days' written notice, be terminated at any time without the payment of any
penalty, by the Board of Directors, by vote of a majority of the outstanding
voting securities of the Fund, or by you. This Agreement shall automatically
terminate in the event of its assignment. In interpreting the provisions of this
Agreement, the definitions contained in Section 2(a) of the Investment Company
Act (particularly the definitions of "interested person," "assignment" and
"majority of the outstanding voting securities"), as from time to time amended,
shall be applied, subject, however, to such exemptions as may be granted by the
Securities and Exchange Commission by any rule, regulation or order.
<PAGE>
Scudder, Stevens & Clark, Inc. -7-
9. Amendment of this Agreement. No provisions of this Agreement may
be changed, waived, discharged or terminated orally, but only by an instrument
in writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought, and no amendment of this Agreement shall be
effective until approved by vote of the holders of a majority of the outstanding
voting securities of the Fund and by the Board of Directors, including a
majority of the Directors who are not interested persons of you or of the
Corporation, cast in person at a meeting for the purpose of voting on such
approval.
10. Miscellaneous. 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. The
Agreement may be executed simultaneously in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
If you are in agreement with the foregoing, please sign the form of
acceptance on the accompanying counterpart of this letter and return such
counterpart to the Corporation, whereupon this letter shall become a binding
contract.
Yours very truly,
SCUDDER FUND, INC.
on behalf of
Managed Intermediate Government Fund
By /s/ [Illegible]
--------------------------
Title
The foregoing Agreement is hereby accepted as of the date thereof.
SCUDDER, STEVENS & CLARK, INC.
By /s/ [Illegible]
---------------------------
Title:
10073265 Exhibit 6(a)
LAZARD FRERES FUNDS, INC.
345 Park Avenue
New York, New York 10154
January 18, 1989
Scudder Fund Distributors, Inc.
175 Federal Street
Boston, Massachusetts 02110
Underwriting Agreement
Dear Sirs:
Lazard Freres Funds, Inc. (the "Corporation") is a corporation
organized under the laws of the State of Maryland and is engaged in the business
of an investment company. The authorized capital stock of the Corporation
consists of shares having a par value of $.00l per share ("Shares"), currently
divided into 7 series ("Funds"). The Shares may be divided into additional Funds
and Funds may be terminated from time to time by action of the Directors. The
Corporation has selected you to act as principal underwriter (as such term is
defined in Section 2(a)(29) of the Investment Company Act of 1940, as amended
(the "1940 Act")) of the Shares of the Funds now or hereafter designated by the
Directors and you are willing to act as such principal underwriter and to
perform the duties and functions of underwriter in the manner and
<PAGE>
on the terms and conditions hereinafter set forth. Accordingly, the Corporation
hereby agrees with you as follows:
1. Delivery of Documents. The Corporation has furnished you with
copies properly certified or authenticated of each of the following:
(a) Articles of Incorporation of the Corporation, dated June 18,
1982;
(b) Appropriate evidence of the establishment of each of the Funds
as a series portfolio of the Corporation;
(c) By-Laws of the Corporation as in effect on the date hereof;
(d) Resolutions of the Board of Directors of the Corporation
selecting you as principal underwriter and approving this form
of Agreement; and
(e) Properly certified or authenticated copies of the
Corporation's Registration Statement on Form N-1A filed by it
with the Securities and Exchange Commission under the
Securities Act of 1933, as amended (the "1933 Act"), or the
1940 Act, together with
2
<PAGE>
any financial statements and exhibits included therein.
The Corporation will furnish you from time to time with copies,
properly certified or authenticated, of all amendments of or supplements to the
foregoing, if any.
2. Registration and Sale of Additional Shares. The Corporation will
from time to time use its best efforts to register under the 1933 Act such
number of Shares not already so registered as you may reasonably be expected to
sell on behalf of the Corporation. You and the Corporation will cooperate in
taking such action as may be necessary from time to time to qualify Shares so
registered for sale by you or the Corporation in any states mutually agreeable
to you and the Corporation, and to maintain such qualification. This Agreement
relates to the issue and sale of Shares that are duly authorized and registered
and available for sale by the Corporation, including redeemed or repurchased
Shares if and to the extent that they may be legally sold and if, but only if,
the Corporation sees fit to sell them.
3. Sale of Shares. (a) Subject to the provisions of paragraphs 5 and
7 hereof and to such minimum purchase requirements as may from time to time be
currently indicated in the Corporation's prospectus or
3
<PAGE>
statement of additional information, you are authorized to sell as agent on
behalf of the Corporation Shares authorized for issue and registered under the
1933 Act. You may also purchase as principal Shares for resale to the public.
Such sales will be made by you on behalf of the Corporation by accepting
unconditional orders to purchase Shares placed with you by investors and such
purchases will be made by you only after acceptance by you of such orders. The
sales price to the public of Shares shall be the public offering price as
defined in paragraph 6 hereof.
(b) You shall have the right to enter into dealer agreements with
securities dealers of your choice ("dealers") for the sale of Shares. Any such
agreement shall be substantially in the form of the agreement attached hereto as
Exhibit A. Shares sold to such dealers shall be for resale by such dealers only
at the public offering price as defined in paragraph 6 hereof.
4. Solicitation of Orders. You will use your best efforts (but only
in states in which you may lawfully do so) to obtain from investors
unconditional orders for Shares authorized for issue by the Corporation and
registered under the 1933 Act, provided that you may in your
4
<PAGE>
discretion refuse to accept orders for Shares from any particular applicant.
5. Sale of Shares by the Corporation. Unless you are otherwise
notified by the Corporation, any right granted to you to accept orders for
Shares or to make sales on behalf of the Corporation or to purchase Shares for
resale will not apply to (i) Shares issued in connection with the merger or
consolidation of any other investment company with the Corporation or its
acquisition, by purchase or otherwise, of all or substantially all of the assets
of any investment company or substantially all the outstanding shares of any
such company, and (ii) to Shares that may be offered by the Corporation to
shareholders of the Corporation by virtue of their being such shareholders.
6. Public Offering Price. All Shares sold to investors by you or any
dealers will be sold at the public offering price. The public offering price for
all accepted subscriptions will be the net asset value per Share, determined in
the manner provided in the Corporation's registration statements as from time to
time in effect under the 1933 Act and the 1940 Act, next after the order is
accepted by you.
5
<PAGE>
7. Suspension of Sales. If and whenever the determination of net
asset value is suspended and until such suspension is terminated, no further
orders for Shares shall be accepted by you except unconditional orders placed
with you before you had knowledge of the suspension. In addition, the
Corporation reserves the right to suspend sales and your authority to accept
orders for Shares on behalf of the Corporation if, in the judgment of a majority
of the Board of Directors or a majority of the Executive Committee of such
Board, if such body exists, it is in the best of interests of the Corporation to
do so, such suspension to continue for such period as may be determined by such
majority; and in that event, no Shares will be sold by you on behalf of the
Corporation while such suspension remains in effect except for Shares necessary
to cover unconditional orders accepted by you before you had knowledge of the
suspension.
8. Portfolio Securities. Portfolio securities of any Fund of the
Corporation may be bought or sold by or through you and you may participate
directly or indirectly in brokerage commissions or "spread" in respect of
transactions in portfolio securities of any Fund of the Corporation; provided,
however, that all sums of money received by you as a result of such purchases
and sales or as a
6
<PAGE>
result of such participation must, after reimbursement of your actual expenses
in connection with such activity, be paid over by you to or for the benefit of
the Corporation.
9. Expenses. (a) The Corporation will pay (or will enter into
arrangements providing that others than you will pay) all fees and expenses
incurred in connection with the provision of shareholder services for the
Corporation, including but not limited to fees and expenses:
(1) in connection with the preparation, setting in type and filing
of any registration statement (including a prospectus and
statement of additional information) under the 1933 Act or the
1940 Act, or both, and any amendments or supplements thereto
that may be made from time to time;
(2) in connection with the registration and qualification of
Shares for sale in the various jurisdictions in which the
Corporation shall determine it advisable to qualify such
Shares for sale (including registering the Corporation as a
broker or dealer or any officer of the Corporation or other
person as agent or salesman of the Corporation in any such
jurisdictions);
(3) of preparing, setting in type, printing and mailing any
notice, proxy statement, report, prospectus or other
communication to shareholders of the Corporation in their
capacity as such;
(4) of preparing, setting in type, printing and mailing
prospectuses annually, and any supplements thereto, to
existing shareholders;
(5) in connection with the issue and transfer of Shares resulting
from the acceptance by you of orders to purchase Shares placed
7
<PAGE>
with you by investors, including the expenses of printing and
mailing confirmations of such purchase orders and the expenses
of printing and mailing a prospectus included with the
confirmation of such orders;
(6) of any issue taxes or any initial transfer taxes;
(7) of WATS (or equivalent) telephone lines other than the portion
allocated to you in this paragraph 9;
(8) of wiring funds in payment of Share purchases or in
satisfaction of redemption or repurchase requests, unless such
expenses are paid for by the investor or shareholder who
initiates the transaction;
(9) of the cost of printing and postage or business reply
envelopes sent to Corporation shareholders;
(10) of one or more CRT terminals connected with the computer
facilities of the transfer agent other than the portion
allocated to you in this paragraph 9;
(11) permitted to be paid or assumed by the Corporation pursuant to
a plan ("12b-1 Plan"), if any, adopted by the Corporation in
conformity with the requirements of Rule 12b-1 under the 1940
Act ("Rule 12b-1") or any successor rule, notwithstanding any
other provision to the contrary herein;
(12) of the expense of setting in type, printing and postage of a
periodic newsletter, if any, to shareholders of the
Corporation other than the portion allocated to you in this
paragraph 9; and
(13) of the salaries and overhead of persons employed by you as
shareholder representatives other than the portion allocated
to you in this paragraph 9.
8
<PAGE>
(b) You shall pay or arrange for the payment of all fees and
expenses incurred in connection with sales of shares of the Corporation to the
public (other than fees and expenses covered by a 12b-1 Plan) including but not
limited to all fees and expenses:
(1) of printing and distributing any prospectuses or reports
prepared for your use in connection with the offering of
Shares to the public;
(2) of preparing, setting in type, printing and mailing any other
literature used by you in connection with the offering of
Shares to the public;
(3) of advertising in connection with the offering of Shares to
the public;
(4) incurred in connection with your registration as a broker or
dealer or the registration or qualification of your officers,
directors, agents or representatives under Federal and state
laws;
(5) of that portion of WATS (or equivalent) telephone lines,
allocated to you on the basis of use by investors (but not
shareholders) who request information or prospectuses;
(6) of that portion of the expense of setting in type, printing
and postage of the periodic newsletter to shareholders
attributable to promotional material included in such
newsletter at your request concerning investment companies
other than the Corporation or concerning the Corporation to
the extent you are required to assume the expense thereof
pursuant to paragraph 9(b)(8), except such material which is
limited to information, such as listings of other investment
companies and their investment objectives, given in
connection
9
<PAGE>
with the exchange privilege as from time to time described in
the Corporation's prospectus;
(7) of that portion of the salaries and overhead of persons
employed by you as shareholder representatives attributable to
the time spent by such persons in responding to requests from
investors, but not shareholders, for information about the
Corporation;
(8) of any activity which is primarily intended to result in the
sale of Shares, unless a 12b-1 Plan shall be in effect which
provides that the Corporation shall bear some or all of such
expenses, in which case the Corporation shall bear such
expenses in accordance with such Plan; and
(9) of that portion of one or more CRT terminals connected with
the computer facilities of the transfer agent attributable to
your use of such terminal(s) to gain access to such of the
transfer agent's records as also serve as your records.
Expenses which are to be allocated between you and the Corporation
shall be allocated pursuant to reasonable procedures or formulae mutually agreed
upon from time to time, which procedures or formulae shall to the extent
practicable reflect studies of relevant empirical data.
10. Conformity with Law. You agree that in selling Shares you will
duly conform in all respects with the laws of the United States and any state in
which Shares may be offered for sale by you pursuant to this Agreement and to
the rules and regulations of the National
10
<PAGE>
Association of Securities Dealers, Inc., of which you are a member.
11. Independent Contractor. You shall be an independent contractor
and neither you nor any of your officers or employees is or shall be an employee
of the Corporation in the performance of your duties hereunder. You shall be
responsible for your own conduct and the employment, control and conduct of your
agents and employees and for injury to such agents or employees or to others
through your agents or employees. You assume full responsibility for your agents
and employees under applicable statutes and agree to pay all employee taxes
thereunder.
12. Indemnification. You agree to indemnify and hold harmless the
Corporation and each of its directors and officers and each person, if any, who
controls the Corporation within the meaning of Section 15 of the 1933 Act,
against any and all losses, claims, damages, liabilities or litigation
(including legal and other expenses) to which the Corporation or such directors,
officers, or controlling person may become subject under such Act, under any
other statute, at common law or otherwise, which may be based upon any untrue
statement or alleged untrue statement of a material fact contained in a
11
<PAGE>
registration statement (including a prospectus or statement of additional
information) covering Shares or any amendment thereof or supplement thereto or
the omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statement therein not misleading if such
statement or omission was made in reliance upon information furnished to the
Corporation by you, provided, however, that in no case (i) is your indemnity in
favor of a director or officer or any other person deemed to protect such
director or officer or other person against any liability to which any such
person would otherwise be subject by reason of willful misfeasance, bad faith,
or gross negligence in the performance of his duties or by reason of his
reckless disregard of obligations and duties under this agreement or (ii) are
you to be liable under your indemnity agreement contained in this paragraph with
respect to any claim made against the Corporation or any person indemnified
unless the Corporation or such person, as the case may be, shall have notified
you in writing within a reasonable time after the summons or other first legal
process giving information of the nature of the claims shall have been served
upon the Corporation or upon such person (or after the Corporation or such
person shall
12
<PAGE>
have received notice of such service on any designated agent), but failure to
notify you of any such claim shall not relieve you from any liability which you
may have to the Corporation or any person against whom such action is brought
otherwise than on account of your indemnity agreement contained in this
paragraph. You shall be entitled to participate, at your own expense, in the
defense, or, if you so elect, to assume the defense of any suit brought to
enforce any such liability, but if you elect to assume the defense, such defense
shall be conducted by counsel chosen by you and satisfactory to the Corporation,
to its officers and/or directors, or to any controlling person or persons,
defendant or defendants in the suit. In the event that you elect to assume the
defense of any such suit and retain such counsel, the Corporation, such officers
and directors or controlling person or persons, defendant or defendants in the
suit shall bear the fees and expenses of any additional counsel retained by
them, provided that the Corporation shall have the right to employ one separate
counsel to represent it and its directors, officers and controlling persons,
defendant or defendants in such suit if in the reasonable judgment of the
Corporation it is advisable because of an actual or potential conflict of
interest between (i) you,
13
<PAGE>
or your officers, directors or controlling persons, defendant or defendants in
such suit, and (ii) the Corporation, or its officers, directors or controlling
persons, defendant or defendants in such suit, in which event the fees and
expenses of such separate counsel shall be borne by you. In the event you do not
elect to assume the defense of any such suit, you will reimburse the
Corporation, such officers and directors or controlling person or persons,
defendant or defendants in such suit for the reasonable fees and expenses of any
counsel retained by them. You agree promptly to notify the Corporation of the
commencement of any litigation or proceedings against it in connection with the
issue and sale of any Shares.
The Corporation agrees to indemnify and hold harmless you and each
of your directors and officers and each person, if any, who controls you within
the meaning of Section 15 of the 1933 Act, against any and all losses, claims,
damages, liabilities or litigation (including legal and other expenses) to which
you or such directors, officers or controlling person may become subject under
such Act, under any other statute, at common law or otherwise, which may be
based upon any untrue statement or alleged untrue statement of a material fact
contained in a
14
<PAGE>
registration statement (including a prospectus or statement of additional
information) covering Shares or any amendment thereof or supplement thereto or
the omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading if
such statement or omission was made in reliance upon information furnished to
you by the Corporation; provided, however, that in no case (i) is the
Corporation's indemnity in favor of a director or officer or any other person
deemed to protect such director or officer or other person against any liability
to which any such person would otherwise be subject by reason of willful
misfeasance, bad faith, or gross negligence in the performance of his duties or
by reason of his reckless disregard of obligations and duties under this
Agreement or (ii) is the Corporation to be liable under its indemnity agreement
contained in this paragraph with respect to any claims made against you or any
such director, officer or controlling person unless you or such director,
officer or controlling person, as the case may be, shall have notified the
Corporation in writing within a reasonable time after the summons or other first
legal process giving information of the nature of the claim shall have been
served upon you or upon such director, officer or control-
15
<PAGE>
ling person (or after you or such director, officer or controlling person shall
have received notice of such service on any designated agent), but failure to
notify the Corporation of any such claim shall not relieve it from any liability
which it may have to the person against whom such action is brought otherwise
than on account of its indemnity agreement contained in this paragraph. The
Corporation will be entitled to participate at its own expense in the defense,
or, if it so elects, to assume the defense of any suit brought to enforce any
such liability, but if the Corporation elects to assume the defense, such
defense shall be conducted by counsel chosen by it and satisfactory to you, your
directors, officers or controlling person or persons, defendant or defendants in
the suit. In the event that the Corporation elects to assume the defense of any
such suit and retain such counsel, you, your directors, officers or controlling
person or persons, defendant or defendants in the suit, shall bear the fees and
expenses of any additional counsel retained by them, provided that you shall
have the right to employ one separate counsel to represent you and your
directors, officers and controlling persons, defendant or defendants in such
suit if in your reasonable judgment it is advisable because of an actual or
potential conflict of
16
<PAGE>
interest between (i) the Corporation, or its officers, directors or controlling
persons, defendant or defendants in such suit, and (ii) you, or your officers,
directors or controlling persons, defendant or defendants in such suit, in which
event the fees and expenses of such separate counsel shall be borne by the
Corporation. In the event the Corporation does not elect to assume the defense
of any such suit, it will reimburse you or such directors, officers or
controlling person or persons, defendant or defendants in the suit, for the
reasonable fees and expenses of any counsel retained by them. The Corporation
agrees promptly to notify you of the commencement of any litigation or
proceedings against it or any of its officers or Trustees in connection with the
issuance or sale of any Shares.
13. Authorized Representations. The Corporation is not authorized to
give any information or to make any representations on behalf of you other than
the information and representations contained in a registration statement
(including a prospectus or statement of additional information) covering Shares,
as such registration statement and prospectus may be amended or supplemented
from time to time.
17
<PAGE>
You are not authorized to give any information or to make any
representations on behalf of the Corporation or in connection with the sale of
Shares other than the information and representations contained in a
registration statement (including a prospectus or statement of additional
information) covering Shares, as such registration statement may be amended or
supplemented from time to time. No person other than you is authorized to act as
principal underwriter (as such term is defined in the 1940 Act) for the
Corporation.
14. Duration and Termination of this Agreement. This Agreement shall
become effective upon the date first written above and shall remain in force
until January 18, 1991, and from year to year thereafter, but only so long as
such continuance is specifically approved at least annually by the vote of a
majority of the Directors who are not interested persons of you or of the
Corporation, cast in person at a meeting called for the purpose of voting on
such approval, and by vote of the Board of Directors or of a majority of the
outstanding voting securities of the Corporation. This Agreement may, on 60
days' written notice, be terminated at any time without the payment of any
penalty, by the Board of Directors of the Corporation, by a vote of a majority
of the outstanding
18
<PAGE>
voting securities of the Corporation, or by you. This Agreement will
automatically terminate in the event of its assignment. In interpreting the
provisions of this paragraph 14, the definitions contained in Section 2(a) of
the 1940 Act (particularly the definitions of "interested person," "assignment"
and "majority of the outstanding voting securities"), as modified by any
applicable order of the Securities and Exchange Commission, shall be applied.
15. Amendment of this Agreement. No provisions of this Agreement may
be changed, waived, discharged or terminated orally, but only by an instrument
in writing signed by the party against whom enforcement of the change, waiver,
discharge or termination is sought. If the Corporation should at any time deem
it necessary or advisable in the best interests of the Corporation that any
amendment of this Agreement be made in order to comply with the recommendations
or requirements of the Securities and Exchange Commission or other governmental
authority or to obtain any advantage under state or Federal tax laws and should
notify you of the form of such amendment, and the reasons therefor, and if you
should decline to assent to such amendment, the Corporation may terminate this
Agreement forthwith. If you should at any time request
19
<PAGE>
that a change be made in the Corporation's Articles of Incorporation or By-laws
or in its methods of doing business, in order to comply with any requirements of
Federal law or regulations of the Securities and Exchange Commission or of a
national securities association of which you are or may be a member relating to
the sale of shares of the Corporation, and the Corporation should not make such
necessary change within a reasonable time, you may terminate this Agreement
forthwith.
16. Termination of Prior Agreements. (a) This Agreement upon its
effectiveness terminates and supersedes all prior underwriting contracts between
the parties.
(b) Notwithstanding anything herein to the contrary, you shall not
be liable for any acts or omissions of any predecessor underwriter for the
Corporation or of any other persons having responsibility for matters to which
this Agreement relates prior to January 1, 1989, nor shall you be responsible
for reviewing any such acts or omissions. You shall, however, be liable for your
own acts and omissions subsequent to assuming responsibility under this
Agreement as herein provided.
17. Miscellaneous. (a) The captions in this Agreement are included
for convenience of reference only and in no way define or delimit any of the
provisions
20
<PAGE>
hereof or otherwise affect their construction or effect. This Agreement may be
executed simultaneously in two or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument.
(b) No Fund of the Corporation shall be liable for claims against
any other Fund of the Corporation.
(c) You acknowledge that the Corporation may, at any time such
action is deemed desirable, suspend or terminate sales of Shares of a Fund and
that upon your receipt of notice of such action by the Corporation you will, for
such period as determined by the Corporation, accept no further orders for
Shares of that Fund except unconditional orders placed with you before you had
knowledge of such action. You acknowledge further that the Corporation may from
time to time set upper and lower limits on the number of Shares of a Fund for
which a purchaser may subscribe and may limit sales of Shares of a Fund to their
existing shareholders.
If you are in agreement with the foregoing, please sign the form of
acceptance on the accompanying counterpart of this letter and return such
counterpart to
21
<PAGE>
the Corporation, whereupon this letter shall become a binding contract.
Very truly yours,
LAZARD FRERES FUNDS, INC.
By: /s/ [Illegible]
---------------------------
Title: Chairman
The foregoing Agreement is hereby accepted as of the date thereof.
SCUDDER FUND DISTRIBUTORS, INC.
By: /s/ [Illegible]
---------------------------
Title: Vice President
22
<PAGE>
10094753 EXHIBIT A
[FORM OF]
DEALER CONTRACT
LAZARD FRERES FUNDS, INC.
345 Park Avenue
New York, New York 10154
Gentlemen:
Scudder Fund Distributors, Inc. ("Distributor") has an agreement
with Lazard Freres Funds, Inc. (the "Fund"), pursuant to which it acts as the
distributor for the sale of shares of the Fund's capital stock, par value $.001
per share ("shares"), and as such has the right to distribute shares for resale.
The Fund is a diversified open-end investment company registered under the
Investment Company Act of 1940, and the shares being offered to the public are
registered under the Securities Act of 1933. You have received a copy of the
Underwriting Agreement between ourselves and the Fund (the "Distribution
Contract") and reference is made herein to certain provisions of the
Distribution Contract. The term "Prospectus", as used herein, refers to the
Prospectus on file with the Securities and Exchange Commission which is part of
the most recent effective Registration Statement of the Fund under the
Securities Act of 1933, as amended from time to time. As principal, we offer to
sell to you, as a dealer, shares upon the following terms and conditions:
1. In all sales of shares to the public you shall act as dealer for
your own account, and in no transaction shall you have any authority to act as
agent for the Fund, for us or for any other dealer.
2. Orders received from you will be accepted through us only at the
public offering price applicable to each order, as set forth in the Prospectus.
The procedure relating to the handling of orders shall be subject to paragraph 4
hereof and instructions which we or the Fund shall forward from time to time to
you. All orders are subject to acceptance or rejection by Distributor or the
Fund in the sole discretion of either. Shares of the Fund shall be offered for
sale and sold in such minimum initial or subsequent investment amounts with
respect to each portfolio of the Fund as are stated in the Prospectus.
<PAGE>
3. You shall not place orders for any shares unless you have already
received purchase orders for these shares at the applicable public offering
price and subject to the terms hereof and of the Distribution Contract. You
agree that you will not offer or sell any shares except under circumstances that
will result in compliance with the applicable Federal and state securities laws
and that in connection with sales and offers to sell shares you will furnish to
each person to whom any such sale or offer is made a copy of the Prospectus and
will not furnish to any person any information relating to shares which is
inconsistent in any respect with the information contained in the Prospectus or
cause any advertisement to be published in any newspaper or posted in any public
place without our consent and the consent of the Fund.
4. As dealer, you are hereby authorized to place orders directly
with the Fund for shares to be resold by us to you subject to the applicable
terms and conditions governing the placement of orders by us set forth in the
Distribution Contract.
5. You shall not withhold placing orders received from your
customers so as to profit yourself as a result of such withholding, e.g., by a
change in the "net asset value" from that used in determining the offering price
to your customers.
6. No person is authorized to make any representations concerning
shares except those contained in the Prospectus and in printed information
subsequently issued by us or the Fund as information supplemental to the
Prospectus. In purchasing shares through us you shall rely solely on the
representations contained in the Prospectus and the supplemental information
above mentioned.
7. You agree to deliver to each purchaser making a purchase of
shares from you a copy of the Prospectus at or prior to the time of offering or
sale, and you agree thereafter to deliver to any purchaser whose shares you are
holding as record holder copies of the annual and interim reports and proxy
solicitation materials relating to the Fund. You further agree to make
reasonable efforts to endeavor to obtain proxies from such purchasers whose
shares you are holding as record holder. Additional copies of the Prospectus,
annual or interim
2
<PAGE>
reports and proxy solicitation materials of the Fund will be supplied to you in
reasonable quantities upon request.
8. Each party hereto has the right to cancel this agreement upon
notice to the other party.
9. We shall have full authority to take such action as we may deem
advisable in respect of all matters pertaining to the continuous offering of
shares. We shall be under no liability to you except for lack of good faith and
for obligations expressly assumed by us herein. Nothing contained in this
paragraph 9 is intended to operate as, and the provisions of this paragraph 9
shall not in any way whatsoever constitute, a waiver by you of compliance with
an provisions of the Securities Act of 1933 or of the rules and regulations of
the Securities and Exchange Commission issued thereunder.
10. You represent that you are a member in good standing of the
National Association of Securities Dealers, Inc. (the "NASD"), or, if a foreign
dealer who is not eligible for membership in the NASD, that (a) you will not
make any sales of shares in, or to nationals of, the United States of America,
its territories or its possessions, and (b) in making any sales of shares you
will comply with the NASD's Rules of Fair Practice.
11. Upon application to us, we will inform you as to the states or
other jurisdictions in which we believe shares have been qualified for sale
under, or are exempt from the requirements of, the respective securities laws of
such states, but we assume no responsibility or obligation as to your right to
sell shares in any jurisdiction.
12. We shall have full authority to act upon your express
instructions to repurchase or exchange shares through us on behalf of your
customers under the terms and conditions provided in the Prospectus. You agree
to hold us harmless as a result of action taken with respect to authorized
repurchases or exchanges upon your express instructions.
13. All communications to us should be sent to 175 Federal Street,
Boston, Massachusetts 02110, Attention: Thomas W. Joseph. Any notice to you
shall be duly given if mailed or telegraphed to you at the address specified by
you below.
3
<PAGE>
14. Your first order placed pursuant to this Contract for the
purchase of shares will represent your acceptance of this Contract.
SCUDDER FUND DISTRIBUTORS, INC.
By ________________________________
(Authorized Signature)
Please return one signed copy of this Contract to:
Scudder Fund Distributors, Inc.
175 Federal Street
Boston, Massachusetts 02110
Accepted:
Firm Name: ____________________________________________
By: ___________________________________________________
Address: ______________________________________________
______________________________________________
Date: ________________
4
Exhibit 8(a)
CUSTODIAN AGREEMENT
AGREEMENT, dated as of ____________________, 1986, between LAZARD
TAX-FREE RESERVES, INC., a Maryland corporation having its principal place of
business at 55 Water Street, New York, New York 10041 (the "Fund"), and STATE
STREET BANK AND TRUST COMPANY, a Massachusetts banking corporation, having its
principal place of business at 225 Franklin Street, Boston, Massachusetts 02101
(the "Custodian").
The parties hereto agree as follows:
ARTICLE 1. EMPLOYMENT OF CUSTODIAN AND
PROPERTY TO BE HELD BY IT:
The Fund hereby employs the Custodian as the custodian of its
assets. The Fund agrees to deliver to the Custodian all securities (other than
securities issued by the Fund) and cash owned by it, and all payments of income,
payments of principal or capital distributions received by it with respect to
all securities owned by the Fund from time to time, and the cash consideration
received by the Fund for shares of the Fund's Capital Stock, $0.001 par value
(the "Shares"), as may be issued or sold by the Fund from time to time. The
Custodian shall not be responsible for any property of the Fund held or received
by the Fund and not delivered to the Custodian.
The Custodian may from time to time employ one or more
subcustodians, but only in accordance with an applicable resolution approved by
the Board of Directors of the Fund, and provided that the Custodian shall have
no more or less responsibility to the Fund on account of any actions or
omissions of any subcustodian so employed than any such subcustodian has to the
Custodian.
ARTICLE 2. DUTIES OF CUSTODIAN WITH RESPECT TO
PROPERTY OF FUND HELD BY CUSTODIAN
Section 2.1 Holding Securities. The Custodian shall hold and
physically segregate for the account of the Fund all non-cash property of the
Fund, including all securities owned by the Fund, other than (a) securities
issued by the Fund and (b) securities which are maintained pursuant to Section
2.12 in a clearing agency registered with the Securities and Exchange Commission
(the "SEC") under Section 17A of the Securities Exchange Act of 1934 which acts
as a securities depository or in the book-entry system
<PAGE>
2
authorized by the United State Department of the Treasury and certain Federal
agencies (such clearing agency and book-entry system being collectively referred
to herein as a "Securities System").
Section 2.2 Delivery of Securities. The Custodian shall release and
deliver securities owned by the Fund which are held by the Custodian or in a
Securities System account of the Custodian only upon receipt of proper
instructions from the Fund, which may be continuing instructions when deemed
appropriate by the parties, and only in the following cases:
(a) upon sale of such securities for the account of the Fund
and receipt of payment therefor;
(b) upon the receipt of payment in connection with any
repurchase agreement relating to such securities entered into by the
Fund;
(c) in the case of a sale effected through a Securities System,
in accordance with the provisions of Section 2.12;
(d) to a designated depository agent in connection with tender
or other similar offers for portfolio securities of the Fund;
(e) 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;
(f) to the issuer thereof or its agent for transfer into the name of
the 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 subcustodian appointed
pursuant to Article 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;
(g) to the broker selling such securities for examination in
accordance with the "street delivery" custom;
<PAGE>
3
(h) for exchange or conversion pursuant to any plan of merger,
consolidation, recapitalization, reorganization or readjustment 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;
(i) 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;
(j) for delivery in connection with any loans of securities made by
the Fund, but only against receipt of adequate collateral as agreed upon
from time to time by the Custodian and the Fund;
(k) for delivery as security in connection with any borrowings by
the Fund requiring a pledge or assets by the Fund, but only against
receipt of amounts borrowed;
(l) upon receipt of instructions from the transfer agent for the
Fund (the "Transfer Agent"), for delivery to the Transfer Agent or to the
holders of Shares in connection with distributions in kind, as may be
described from time to time in the Fund's currently effective Prospectus
(the "Prospectus") included in the Fund's Registration Statement, as
amended from time to time, under the Securities Act of 1933, relating to
the offering of Shares for sale, in satisfaction of requests by holders of
Shares for repurchase or redemption; and
(m) for any other proper corporate purpose of the Fund, but only
upon receipt of, in addition to proper instructions from the Fund, a
certified copy of a resolution approved by the Fund's Board of Directors
or Executive Committee specifying the securities to the 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.
Section 2.3 Registration of Securities. Securities held by the
Custodian (other than bearer
<PAGE>
4
securities) shall be registered in the name of the 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 Fund has authorized in writing the
appointment of a nominee to be used in common with other investment companies
registered under the Investment Company Act of 1940 (the "1940 Act") which have
the same investment adviser as 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
subcustodian appointed pursuant to Article 1. All securities accepted by the
Custodian on behalf of the Fund under the terms of this Agreement shall be in
"street" or other good delivery form.
Section 2.4 Bank Accounts. The Custodian shall open and maintain a
separate bank account or accounts in the name of the Fund, subject only to draft
or order by the Custodian acting pursuant to the terms of this Agreement, and
shall hold in such account or accounts, subject to the provisions hereof, all
cash received by it from or for the account of the Fund, other than cash
maintained by the Fund in a bank account established and used in accordance with
Rule 17f-3 promulgated by the SEC under the 1940 Act. Cash held by the Custodian
or in such other banks or trust companies as it may in its discretion deem
necessary or desirable, provided 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 Directors of the Fund.
Such funds shall be deposited by the Custodian in its capacity as Custodian and
shall be withdrawable by the Custodian only in that capacity.
Section 2.5 Payments for Shares. The Custodian shall receive from
the distributor of Shares or from the Transfer Agent and deposit into the Fund's
account with the Custodian such payments as are received for Shares issued or
sold from time to time by the Fund. The Custodian will provide timely
notification to the Fund and the Transfer Agent, at such times as the Fund may
request, of any receipt by the Custodian of payments for Shares.
Section 2.6 Investment and Availability of Federal Funds. Upon
mutual agreement between the Fund and the Custodian, the Custodian shall,
upon the receipt of proper instructions from the Fund,
<PAGE>
5
(a) invest all Federal funds received after a time agreed upon
between the Custodian and the Fund in such instruments as may be requested
by the Fund; and
(b) make Federal funds available to the Fund as of specified times
agreed upon from time to time by the Fund and the Custodian in the amount
of checks received in payment for Shares of the Fund which are deposited
into the Fund's account.
Section 2.7 Collection of Income. The Custodian shall collect on a
timely basis all income and other payments with respect to registered securities
held hereunder to which the 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 agent
thereof and shall credit such income and other payments, as collected, to the
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. In any case in which the
Custodian does not receive due and unpaid income with respect to securities held
hereunder within a reasonable time after the Custodian has made demands for the
same, the Custodian shall notify the Fund in writing and await instructions from
the Fund.
Section 2.8 Payment of Fund Moneys. Upon receipt of proper
instructions from the Fund, which may be continuing instructions when deemed
appropriate by the parties, the Custodian shall pay out moneys of the Fund in
the following cases only:
(a) upon the purchase of securities for the account of the Fund, but
only (i) against the delivery of such securities 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 and in proper form for transfer; (ii) in the
case of a purchase effected through a Securities Systems, in accordance
with the conditions set forth in Section 2.12 or (iii) in the case of
repurchase agreements entered into between the Fund
<PAGE>
6
and the Custodian or a dealer or another commercial bank, (A) against
delivery of the securities either in certificate form or through an entry
crediting the Custodian's account at the Federal Reserve Bank of Boston
with such securities or (B) against delivery of the receipt evidencing
purchase by 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;
(b) in connection with conversion, exchange or surrender of
securities owned by the Fund as set forth in Section 2.2;
(c) for the redemption or repurchase of Shares as set forth in
Section 2.10;
(d) for the payment of any expense or liability incurred by the
Fund, including, but not limited to, the following payments for the
account of the Fund: interest, taxes, management, accounting, expenses of
the Transfer Agent, legal fees, and operating expenses of the Fund whether
or not such expenses are to be in whole or in part capitalized or treated
as deferred expenses;
(e) for the payment of any dividends or distributions declared
by the Board of Directors of the Fund;
(f) for the purpose of opening fixed time deposits as provided in
the Prospectus, but only against delivery of a non-negotiable receipt;
or
(g) for any other proper purpose, but only upon receipt of, in
addition to proper instructions from the Fund, a certified copy of a
resolution approved by the Fund's Board of Directors or Executive
Committee specifying the amount of such payments, setting forth the
purpose for which such payment is to be made, declaring such purpose to be
a proper corporate purpose, and naming the person or persons to whom such
payment is to be made.
Section 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 the Fund is made by the Custodian in advance of
receipt of the securities purchased and in the absence of specific written
instructions from the Fund 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
<PAGE>
7
received by the Custodian, except that in the case of repurchase agreements
entered into by the Fund with a bank which is a member of the Federal Reserve
System, the Custodian may transfer funds to the account of such bank prior to
the receipt of written evidence that the securities subject to such repurchase
agreement have been transferred by book-entry into a segregated non-proprietary
account of the Custodian maintained with the Federal Reserve Bank of Boston or
of the safekeeping receipt, provided that such securities have in fact been so
transferred by book-entry.
Section 2.10 Payments for Repurchases or Redemptions of Share of
the Fund. From such funds as may be available for the purpose but subject to the
limitations of the Fund's Articles of Incorporation and any applicable
resolutions approved by the Fund's Board of Directors or Executive Committee,
the Custodian shall, upon receipt of instructions from the Transfer Agent, make
funds available for payment to holders of Shares who have delivered to the
Transfer Agent a request for redemption or repurchase of their Shares. In
connection with the redemption or repurchase of Shares, the Custodian is
authorized, upon receipt of instructions from the Transfer Agent, to wire funds
to or through a domestic commercial bank which is a member of the Federal
Reserve System designated by the redeeming shareholder. In connection with the
redemption or repurchase of Shares, the Custodian shall honor checks drawn on
the Custodian by a holder of Shares, which checks have been furnished by the
Fund to the holder of Shares, when presented to the Custodian in accordance with
such procedures and controls as are mutually agreed upon from time to time
between the Fund and the Custodian.
Section 2.11 Appointment 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 to act as a
custodian, as the Custodian's agent to carry out such of the provisions of this
Article 2 as the Custodian may from time to time direct, provided that the
appointment of any agent shall not relieve the Custodian of its responsibilities
or liabilities hereunder.
Section 2.12 Deposit of Fund Assets in Securities Systems. The
Custodian may deposit and/or maintain securities owned by the Fund in a
Securities System in accordance with applicable rules and regulations of the
Federal Reserve Board and the SEC, subject to the following provisions:
<PAGE>
8
(a) the Custodian may keep securities of the Fund in a Securities
System provided that such securities are represented in an account (the
"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;
(b) the records of the Custodian with respect to securities of the
Fund which are maintained in a Securities System shall identify by
book-entry those securities belonging to the Fund;
(c) the Custodian shall pay for securities purchased for the account
of the Fund upon (i) receipt of advice from the Securities System that
such securities have been transferred to the Account and (ii) the making
of any 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 from the account of the 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 notices from the Securities System of transfers of
securities for the account of the Fund shall identify the Fund, be
maintained for the Fund by the Custodian and be provided to the Fund at
its request; and the Custodian shall furnish the Fund confirmation of each
transfer to or from the account of the Fund in the form of a written
advice or notice and shall furnish to the Fund on the next business day
copies of daily transaction sheets reflecting each day's transactions in
the Securities System for the account of the Fund;
(d) the Custodian shall provide the Fund 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;
(e) the Custodian shall have received the initial or annual
certificate, as the case may be, required by Article 9; and
(f) anything to the contrary in this Agreement notwithstanding, the
Custodian shall be liable to the Fund for any loss or damage to the Fund
resulting from use of the Securities System by reason of any negligence,
misfeasance or misconduct of the Custodian
<PAGE>
9
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; and, at the election of the
Fund, it shall be entitled to be subrogated to the rights of the Custodian
with respect to any clam 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 the Fund has not been made whole for any such
loss or damage.
Section 2.13 Ownership Certificates for Tax Purposes. The Custodian
shall execute ownership and other certificates and affidavits for all Federal
and state tax purposes in connection with the receipt of income or other
payments with respect to securities of the Fund held by it and in connection
with transfers or securities.
Section 2.14 Proxies. 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 the Fund or a nominee of the Fund, all proxies, without indication
of the manner in which such proxies are to be voted, and shall promptly deliver
to the Fund such proxies, all proxy soliciting materials and all notices
relating to such securities.
Section 2.15 Communications Relating to Fund Portfolio Securities.
The Custodian shall transmit promptly to the Fund all written information
(including, without limitation, pendency of calls and maturities of securities
and expirations of rights in connection therewith) 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 Fund 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 Fund desires to take action with respect to any
tender offer, exchange offer or any other similar transaction, the Fund shall
notify the Custodian at least three business days prior to the date on which the
Custodian is to take such action.
Section 2.16 Proper Instructions. The term "proper instructions", as
used throughout this Article 2, means a writing signed or initialled by one or
more persons as the Board of Directors of the Fund shall have from time to time
authorized. Each such writing shall set forth the
<PAGE>
10
specific transaction or type of transaction involved, including a specific
statement of the purpose for which such action is requested. Oral instructions
will be considered "proper instructions" if the Custodian reasonably believes
them to have been given by a person authorized by the Board of Directors of the
Fund to give such instructions with respect to the transaction involved. The
Fund shall cause all oral instructions to be confirmed in writing. Upon receipt
of a certificate of the Secretary or an Assistant Secretary of the Fund as to
the authorization by the Board of Directors of the Fund accompanied by a
detailed description of procedures approved by the Board of Directors, "proper
instructions" may include communications effected directly between
electro-mechanical or electronic devices provided that the Board of Directors of
the Fund and the Custodian are satisfied that such procedures afford adequate
safeguards for the Fund's assets.
Section 2.17 Actions Permitted without Express Authority. The
Custodian may in its discretion, without express authority from the Fund:
(a) make payments to itself or others for minor expenses of handling
securities or other similar items relating to its duties under this
Agreement, provided that all such payments shall be accounted for to the
Fund;
(b) surrender securities in temporary form for securities in
definitive form;
(c) endorse for collection, in the name of the Fund, checks,
drafts and other negotiable instruments; and
(d) 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 the Fund except as
otherwise directed by the Board of Directors of the Fund.
Section 2.18. Evidence of Authority. The Custodian shall be
protected in acting upon any instructions, notice, request, consent, certificate
or other instrument or paper believed by it in good faith to be genuine and to
have been properly executed by or on behalf of the Fund. The Custodian may
receive and accept a certified copy of a resolution approved by the Fund's Board
of Directors or Executive Committee as conclusive evidence (a) of the authority
of any person to act in accordance with such
<PAGE>
11
resolution or (b) of any determination or of any action by the Fund's Board of
Directors or Executive Committee pursuant to the Fund's Articles of
Incorporation and By-laws as described in such resolution, and such resolution
may be considered as in full force and effect until receipt by the Custodian of
written notice to the contrary.
ARTICLE 3. DUTIES OF CUSTODIAN WITH RESPECT TO
THE BOOKS OF ACCOUNT AND CALCULATION OF
NET ASSET VALUE AND NET INVESTMENT INCOME
The Custodian shall cooperate with and supply necessary information
to the entity or entities appointed by the Board of Directors of the Fund to
keep the books of account of the Fund and compute the net asset value per share
of the outstanding Shares or, if directed in writing to do so by the Fund, shall
itself keep such books of account and compute such net asset value per share. If
so directed, the Custodian shall also calculate daily the net investment income
of the Fund as described in the Prospectus and shall advise the Fund and the
Transfer Agent daily of the total amounts of such net investment income and, if
instructed in writing by an officer of the Fund to do so, shall advise the
Transfer Agent periodically of the division of such net investment income among
its various components. The calculations of the net asset value per share and
the daily net investment income of the Fund shall be made at the time or times
described in the Prospectus.
ARTICLE 4. RECORDS
The Custodian shall create and maintain all records relating to its
activities and obligations under this Agreement in such manner as will meet the
obligations of the Fund under the 1940 Act, with particular attention to Section
31 thereof and Rules 31a-1 and 31a-2 promulgated by the SEC thereunder,
applicable Federal and state tax laws and any other law or administrative rules
or procedures which may be applicable to the Fund. All such records shall be the
property of the Fund 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 Fund and employees and agents of the SEC. The Custodian shall, at
such times as the Fund may request, supply the Fund with a tabulation of
securities owned by the Fund and held by the Custodian and shall, when requested
to do so by the Fund and for such compensation as shall be agreed upon
<PAGE>
12
between the Fund and the Custodian, include certificate numbers in such
tabulations.
ARTICLE 5. OPINION OF FUND'S INDEPENDENT PUBLIC ACCOUNTANT
The Custodian shall take all reasonable action as the Fund may from
time to time request to obtain from year to year favorable opinions from the
Fund's independent public accountants with respect to the Custodian's activities
hereunder in connection with the preparation of the Fund's Form N-1 and Form
N-1R and other annual reports for filing with the SEC and with respect to any
other requirements of the SEC.
ARTICLE 6. REPORTS TO FUND BY INDEPENDENT PUBLIC ACCOUNTANTS
The Custodian shall provide the Fund, as such times as the Fund may
reasonably require, with reports by independent public accountants on the
accounting system, internal accounting control and procedures for safeguarding
securities, including securities deposited and/or maintained in a Securities
System, relating to the services provided by the Custodian under this Agreement.
The reports shall be of sufficient scope and in sufficient detail as may
reasonably be required by the Fund to provide reasonable assurance that any
material inadequacies would be disclosed by the examination conducted by the
accountants, and, if there are no inadequacies, shall so state.
ARTICLE 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 the
Fund and the Custodian.
ARTICLE 8. RESPONSIBILITY OF CUSTODIAN
So long as and to the extent that it is in the exercise of
reasonable care, the Custodian shall not be responsible for the title, validity
or genuineness of any property or evidence of title thereto received by it or
delivered by it pursuant to this Agreement and shall be held harmless in acting
upon any notice, request, consent, certificate or other instrument reasonably
believed by it to be genuine and to be signed by the proper party or parties.
<PAGE>
13
The Custodian shall be held to the exercise of reasonable care in carrying out
the provisions of the Agreement, but shall be indemnified by and shall be
without liability to the Fund for any action in connection with the transactions
contemplated hereby taken or omitted by it in good faith and without negligence.
The Custodian shall be entitled to rely on and may act upon advice or counsel
(who may be counsel for the Fund) 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. Notwithstanding the foregoing, the responsibility of the Custodian
with respect to redemption effected pursuant to the check redemption service
described in the Prospectus shall be in accordance with a separate agreement
entered into between the Custodian and the Fund.
In order that the indemnification provision contained in this
Article 8 shall apply, it is understood that if in any case the Fund may be
asked to indemnify or save the Custodian harmless, the Fund 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 Fund promptly concerning any situation which presents or
appears likely to present the probability of such a claim for indemnification
against the Fund. The Fund 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 Fund so elects, it will so notify the Custodian and thereupon the Fund
shall take over complete defense of the claim and the Custodian shall in such
situation incur no further legal or other expenses for which it shall seek
indemnification under this Article 8. The Custodian shall in no case confess any
claim or make any compromise or settlement in any case in which the Fund will be
asked to indemnify the Custodian, except with the Fund's prior written consent.
If the Fund requires the Custodian to take any action with respect
to securities, which action involves the payment of money or which action may,
in the opinion of the Custodian, result in the Custodian or its nominee assigned
to the Fund being liable for the payment of money or incurring liability of some
other form, the Fund, as a prerequisite to requiring the Custodian to take such
action, shall provide indemnity to the Custodian in an amount and form
satisfactory to it.
<PAGE>
14
ARTICLE 9. EFFECTIVE PERIOD, TERMINATION AND AMENDMENT
The Agreement 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
delivered or mailed, postage prepaid to the other party, such termination to
take effect not sooner than 30 days after the date of such delivery or mailing
provided that the Custodian shall not act under Section 2.12 in the absence of
receipt of an initial certificate of the Secretary or an Assistant Secretary of
the Fund that the Board of Directors of the Fund has approved the initial use of
a particular Securities System and the receipt annually thereafter of a
certificate of the Secretary or an Assistant Secretary of the Fund that the
Board of Directors of the Fund has reviewed the use by the Fund of such
Securities System, as required in each case by Rule 17f-4 promulgated by the SEC
under the 1940 Act, provided further that the Fund shall not amend or terminate
this Agreement in contravention of any applicable Federal or state regulations,
or any provision of the Fund's Articles of Incorporation, and provided further
that the Fund may at any time by action of its Board of Directors (a) substitute
another bank or trust company for the Custodian by giving notice as described
above to the Custodian, or (b) immediately terminate this Agreement in the event
of the appointment of a conservator or receiver for the Custodian by the United
State Comptroller of the Currency or upon the happening of a like event at the
direction of an appropriate regulatory agency or court of competent
jurisdiction.
Upon termination of this Agreement, the Fund 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
hereunder.
ARTICLE 10. SUCCESSOR CUSTODIAN
If a successor custodian shall be appointed by the Board of
Directors of the Fund, the Custodian shall, upon termination, deliver to such
successor at the office of the Custodian, duly endorsed and in the form for
transfer, all securities then held by it hereunder.
If no such successor custodian shall be appointed, the Custodian
shall, in like manner, upon receipt of a cer-
<PAGE>
15
tified copy of a resolution approved by the Fund's Board of Directors or
Executive Committee, deliver at the office of the Custodian such securities,
funds and other properties in accordance with such resolution.
In the event that no written order designating a successor custodian
or certified copy of a resolution approved by the Fund's Board of Directors or
Executive Committee shall have been delivered to the Custodian on or before the
date when termination of this Agreement shall become effective, then the
Custodian shall have the right to deliver to a bank or trust company of its own
selection, which is a "bank" as defined in the 1940 Act, doing business in
Boston, Massachusetts, having an aggregate capital, surplus, and undivided
profits, as shown by its last published report, of not less than $25,000,000,
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 Agreement. Thereafter, such bank or trust company shall be the
successor of the Custodian under this Agreement.
In the event that securities, funds and other properties remain in
the possession of the Custodian after failure of the Fund to procure the
certified copy of resolution referred to or of the Board of Director 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 Agreement
relating to the duties and obligations of the Custodian shall remain in full
force and effect.
ARTICLE 11. INTERPRETIVE AND ADDITIONAL PROVISIONS
In connection with the operation of this Agreement, the Custodian
and the Fund 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 provision 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 Articles of Incorporation or By-laws of the Fund. No interpretive or
additional provisions made as provided in the preceding sentence shall be deemed
to be an amendment of this Agreement.
<PAGE>
16
ARTICLE 12. MASSACHUSETTS LAW TO APPLY
This Agreement shall be construed and the provisions thereof
interpreted under and in accordance with the Laws of Massachusetts.
ARTICLE 13. PERSONAL LIABILITY
It is understood and expressly stipulated that neither the holders
of Shares nor directors of the Fund shall be personally liable hereunder.
ARTICLE 14. PRIOR CONTRACTS
This Agreement supersedes and terminates, as of the date hereof, all
prior agreements between the Fund and Custodian relating to the custody of the
Fund's assets.
IN WITNESS WHEREOF, each of the parties has caused this instrument
to be executed in its name and behalf by its duly authorized representative as
of the date first above written.
LAZARD TAX-FREE RESERVES, INC.
By_____________________________
President
STATE STREET BANK AND TRUST COMPANY
By______________________________
Vice President
EXHIBIT 8(b)
TRANSFER AGENCY AND SERVICE AGREEMENT
between
SCUDDER FUND, INC.
and
SCUDDER SERVICE CORPORATION
<PAGE>
TABLE OF CONTENTS
Page
Article 1 Terms of Appointment; Duties of the Agent ..... 3
Article 2 Fees and Expenses ............................. 6
Article 3 Representations and Warranties of the Agent ... 7
Article 4 Representations and Warranties of the Company . 8
Article 5 Indemnification ............................... 8
Article 6 Covenants of the Company and the Agent ........ 11
Article 7 Termination of Agreement ...................... 13
Article 8 Additional Series ............................. 13
Article 9 Delegation .................................... 13
Article 10 Amendment ..................................... 14
Article 11 Massachusetts Law to Apply .................... 14
Article 12 Form N-SAR .................................... 14
Article 13 Merger of Agreement ........................... 14
Article 14 Counterparts .................................. 14
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<PAGE>
TRANSFER AGENCY AND SERVICE AGREEMENT
AGREEMENT made as of January 1, 1990, by and between SCUDDER FUND, INC., a
Maryland corporation, having its principal office and place of business at 345
Park Avenue, New York, New York 10154 (the "Company") and SCUDDER SERVICE
CORPORATION, a Massachusetts corporation, having its principal office and place
of business at 160 Federal Street, Boston, Massachusetts 02110 (the "Agent").
WHEREAS, the Company desires to appoint the Agent as the Company's
transfer agent, dividend disbursing agent and agent in connection with certain
other activities and the Agent desires to accept such appointment;
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
the parties hereto agree as follows:
Article 1. Terms of Appointment; Duties of the Agent.
1.01. Subject to the terms and conditions set forth in this Agreement, the
Company hereby employs and appoints the Agent to act as, and the Agent agrees
to act as, transfer agent for the Company's authorized shares of Capital Stock,
$ .001 par value per share ("Shares"), dividend disbursing agent and agent in
connection with any accumulation, open-account or similar plans provided to the
shareholders of the Company ("Shareholders") and set out in a currently
effective prospectus ("Prospectus") or currently effective statement of
additional information ("Statement of Additional Information") of the Company,
including without limitation any periodic investment plan or periodic withdrawal
program. If the Company offers two or more series of Shares, the term "Company"
shall be deemed to apply to each series of Shares, unless the context otherwise
requires.
1.02. The Agent agrees that it will perform the following services:
(a) In accordance with procedures established from time to time by
agreement between the Company and the Agent, the Agent shall:
(i) Receive for acceptance in the manner described in the
Prospectus and the Statement of Additional Information
orders for the purchase of Shares and promptly deliver
payment and appropriate documentation therefor to the
duly authorized custodian of the Company (the
"Custodian");
(ii) Pursuant to orders for the purchase of Shares, record
the purchase of the appropriate number of Shares in the
Shareholder's account after payment is received and, if
requested by the
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<PAGE>
Shareholder, and if the Directors of the Company have
authorized the issuance of stock certificates, issue a
certificate for the appropriate number of full Shares;
(iii) Reinvest income dividends and capital gain distributions
in additional Shares or prepare and transmit payments
for income dividends and capital gain distributions in
accordance with the terms set forth in the Prospectus
and Statement of Additional Information;
(iv) Receive for acceptance in the manner described in the
Prospectus and the Statement of Additional Information
redemption requests and redemption directions and
deliver the appropriate documentation thereof to the
Custodian;
(v) Provide an appropriate response to Shareholders with
respect to all correspondence and rejected trades;
(vi) At the appropriate time as and when it receives monies
paid to it by the Custodian with respect to any
redemption, pay over or cause to be paid over in the
appropriate manner such monies as instructed by the
redeeming Shareholders;
(vii) Effect transfers of Shares by the registered owners
thereof upon receipt of appropriate instructions and
documentation;
(viii) Report abandoned property to the various states as
authorized by the Company in accordance with policies
and principles agreed upon by the Company and Agent;
(ix) Maintain records of account for and advise the Company
and its Shareholders as to the foregoing;
(x) Record by series the issuance of Shares of the Company
and maintain an accurate control book with respect to
Shares pursuant to Rule 17Ad-l0(e) under the Securities
Exchange Act of 1934. The Agent shall, for purposes of
compliance with Maryland law regarding the overissuance
of Shares and compliance with applicable blue sky laws,
on a daily basis monitor with respect to all trades and
communications sent directly to
-4-
<PAGE>
the Agent, and review with respect to all trades and
communications of the Company, whether sent directly to
the underwriter or Agent, the total number of Shares of
each series which are issued and outstanding and the
total number of Shares of each series which are sold in
each State;
(xi) Respond to all telephone inquiries from Shareholders or
their authorized representatives regarding the status of
Shareholder accounts; and
(xii) Respond to correspondence from Shareholders or their
authorized representatives regarding the status of
Shareholder accounts or information related to
Shareholder accounts; and
(xiii) Perform all Shareholder account maintenance updates.
(b) In addition to and neither in lieu of nor in contravention of
the services set forth in the above paragraph (a), the Agent shall: (i) perform
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). The detailed definition, frequency, limitations and
associated costs (if any) set out in the attached fee schedule, include but are
not limited to: maintaining all Shareholder accounts, preparing Shareholder
meeting lists, mailing proxy statements and proxies, receiving and tabulating
proxies, mailing shareholder reports and prospectuses to current Shareholders,
and withholding all applicable taxes (including but not limited to all
withholding taxes imposed under the U.S. Internal Revenue Code and Treasury
regulations promulgated thereunder, and applicable state and local laws to the
extent consistent with good industry practice), preparing and filing U.S.
Treasury Department Forms 1099, Form 941 when applicable and other appropriate
forms required with respect to dividends, distributions and taxes withheld on
Shareholder accounts by federal authorities for all registered Shareholders,
preparing and mailing confirmation forms and statements of account to
Shareholders for all purchases and redemptions of Shares and other confirmable
transactions in Shareholder accounts, preparing and mailing activity statements
for Shareholders, providing Shareholder account information and providing lists
of Shareholders to states (Ohio), (ii) provide daily and monthly a written
report and access to information which will enable the Company to monitor the
total number of Shares sold
-5-
<PAGE>
(on a series-by-series basis, if necessary) and the aggregate public offering
price thereof in each state by the Company, added by sales in each state of the
registered Shareho1der or dealer branch office, as defined by the Company, and
such other information as may reasonably be necessary to comply with the state
securities commissions' requirements for the registration of Shares, and (iii)
if directed by the Company, (A) each confirmation of the purchase which
establishes a new account will be accompanied by a Prospectus and any amendment
or supplement thereto, and (B) a Prospectus, and any amendment or supplement
thereto, will be mailed to each Shareholder at the time a confirmation of the
first purchase by such Shareholder, subsequent to the effective date of a
Prospectus or any amendment or supplement thereto, is mailed to such
Shareholder.
(c) In addition, the Company shall (i) identify all states in which
Shares of the Company are eligible for sale, (ii) identify to the Agent in
writing those transactions and assets to be treated as exempt from blue sky
reporting to the Company for each state and (iii) approve those transactions to
be included for each state on the blue sky system prior to activation and
thereafter monitor the daily activity for each state. The responsibility of the
Agent for the Company's blue sky registration status is solely limited to the
monitoring and reporting of the transactions subject to blue sky compliance by
the Company as provided above.
(d) The Agent shall make appropriate arrangements with a banking
institution in connection with effecting timely redemptions of Shares by a check
redemption service if offered by the Company and described in its Prospectus,
Statement of Additional Information or both.
(e) The Agent shall certify to the Company in writing relative to
all required mailings and filings.
1.03. The Agent's offices, personnel and computer and other equipment
shall be adequate to perform the services contemplated by this Agreement for the
Company and for other investment companies advised or administered by Scudder,
Stevens & Clark, Inc. and its affiliates. The Agent shall notify the Company in
the event that it proposes to provide such services for any other investment
company.
Article 2. Fees and Expenses.
2.01. For the performance by the Agent pursuant to this Agreement, the
Company agrees to pay the Agent an annual maintenance fee for each Shareholder
account as set out in a fee schedule agreed to by both parties in writing. Such
fees and out-of-pocket expenses and advances identified under Section 2.02
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<PAGE>
below may be changed from time to time subject to mutual written agreement
between the Company and the Agent, as approved by a majority of the Directors
who are not "interested persons" (as defined in the Investment Company Act of
1940).
2.02. In addition to the fee paid under Section 2.0l above, the Company
agrees to reimburse the Agent for out-of-pocket expenses or advances incurred by
the Agent for the items set out in the fee schedule agreed to by both parties in
writing. In addition, any other expenses incurred by the Agent at the request or
with the consent of the Company will be reimbursed by the Company.
2.03. The Company agrees to pay all fees and reimbursable expenses
promptly, the terms, method and procedures for which are detailed on the fee
schedule agreed to by both parties in writing. Postage for mailing of dividends,
proxy statements, Company reports and other mailings to all Shareholder accounts
shall be advanced to the Agent by the Company upon request of the Agent, at
least two (2) days prior to the mailing date of such materials.
2.04. The Company may engage accounting firms or other consultants to
evaluate the fees paid by the Company and the quality of services rendered by
the Agent, and such firms or other consultants shall be provided access by the
Agent to such information as may be reasonably required in connection with such
engagement. The Agent will give due consideration and regard to the
recommendations to the Company in connection with such engagement, but shall not
be bound thereby.
Article 3. Representations and Warranties of the Agent.
The Agent represents and warrants to the Company that:
3.01. It is a corporation duly organized and existing and in good standing
under the laws of The Commonwealth of Massachusetts.
3.02. It has the leqal power and authority to carry on its businesses in
The Commonwealth of Massachusetts.
3.03. It is empowered under applicable laws and by its charter and by-laws
to enter into and perform this Agreement.
3.04. All requisite proceedings have been taken to authorize it to enter
into and perform this Agreement.
3.05. It is duly registered as a transfer agent under Section 17A of the
Securities Exchange Act of 1934, as amended.
3.06. It has and will continue to have access to the necessary facilities,
equipment and personnel to perform its duties and obligations under this
Agreement.
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<PAGE>
Article 4. Representations and Warranties of the Company.
The Company represents and warrants to the Agent that:
4.01. It is a corporation duly organized and existing and in good standing
under the laws of Maryland.
4.02. It is empowered under applicable laws and by its Articles of
Incorporation and By-Laws to enter into and perform this Agreement.
4.03. All proceedings required by said Articles of Incorporation and
By-Laws have been taken to authorize it to enter into and perform this
Agreement.
4.04. It is an investment company registered under the Investment Company
Act of 1940, as amended.
4.05. A registration statement under the Securities Act of 1933 is
currently effective and will remain effective, and appropriate state securities
law filings have been made and will continue to be made, with respect to all
Shares of the Company being offered for sale.
Article 5. Indemnification.
5.01. To the extent that the Agent acts in good faith and without
negligence or willful misconduct, the Agent shall not be responsible for, and
the Company shall indemnify and hold the Agent harmless from and against, any
and all losses, damages, costs, charges, counsel fees, payments, expenses and
liabilities arising out of or attributable to:
(a) All actions of the Agent or its agents or subcontractors
required to be taken and correctly executed pursuant to this Agreement.
(b) The Company's lack of good faith, negligence or willful
misconduct or the breach of any representation or warranty of the Company
hereunder.
(c) The reasonable reliance on or use by the Agent or its agents or
subcontractors of information, records and documents or services which are
received or relied upon by the Agent or its agents or subcontractors and
furnished to it or performed by or on behalf of the Company.
(d) The reasonable reliance on, or the carrying out by the Agent or
its agents or subcontractors of, any written instructions or requests of the
Company.
-8-
<PAGE>
(e) 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, unless such violation is the result of the Agent's negligent or willful
failure to comply with the provisions of Section 1.02(b) (ii) of this Agreement.
5.02. The Agent shall indemnify and hold the Company harmless from and
against any and all losses, damages, costs, charges, counsel fees, payments,
expenses and liabilities arising out of or attributable to the Agent's refusal
or failure to comply with the terms of this Agreement (whether as a result of
the acts or omissions of the Agent or of its agents or subcontractors) or
arising out of the lack of good faith, negligence or willful misconduct of the
Agent, or its agents or subcontractors, or arising out of the breach of any
representation or warranty of the Agent hereunder.
5.03. At any time the Agent may apply to any officer of the Company for
instructions, and may consult with outside legal counsel with respect to any
matter arising in connection with the services to be performed by the Agent
under this Agreement, and the Agent and its agents or subcontractors shall not
be liable and shall be indemnified by the Company for any action reasonably
taken or omitted by it in reliance upon such instructions or upon the opinion of
such counsel. The Agent, its agents and subcontractors shall be protected and
indemnified in acting upon any paper or document furnished by or on behalf of
the Company, reasonably believed to be genuine and to have been signed by the
proper person or persons, or upon any instruction, information, data, records or
documents provided to the Agent or its agents or subcontractors by
machine-readable input, telex, CRT data entry or other similar means authorized
by the Company, and shall not be held to have notice of any change of authority
of any person, until receipt by the Agent of written notice thereof from the
Company. The Agent, its agents and subcontractors shall also 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 Company,
and the proper countersignature of any former transfer agent or registrar, or of
a co-transfer agent or co-registrar.
5.04. In the event either party is unable to perform its obligations under
the terms of this Agreement because of acts of God, strikes, equipment or
transmission failure or damage reasonably beyond its control, or other causes
reasonably beyond its control, such party shall not be liable to the other for
any damages resulting from such failure to perform or otherwise from such
causes.
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<PAGE>
5.05. Neither party to this Agreement shall be liable to the other party
for consequential damages under any provision of this Agreement, but each shall
be liable for general damages resulting from breach of this Agreement. For the
purposes of this Agreement, the term "general damages" shall include but shall
not be limited to:
(a) All costs of correcting errors made by the Agent or its agents
or subcontractors in Company Shareholder accounts, including
the expense of computer time, computer programming and
personnel;
(b) Amounts which the Company is liable to pay to a person (or his
representative) who has purchased or redeemed, or caused to be
repurchased, Shares at a price which is higher, in the case of
a purchase, or lower, in the case of a redemption or
repurchase, than current net asset value per Share, but only
to the extent that the price at which such Shares were
purchased, redeemed or repurchased was incorrect as a result
of either (i) one or more errors caused by the Agent or its
agents or subcontractors in processing Shareholder accounts of
the Company or (ii) the posting by the Agent of the purchase,
redemption or repurchase of Shares subsequent to the time such
purchase, redemption or repurchase should have been posted
pursuant to laws and regulations applicable to open-end
investment companies, if the delay is caused by the Agent, its
agents or subcontractors;
(c) The value of dividends and distributions which were not
credited on Shares because of the failure of the Agent or its
agents or subcontractors to timely post the purchase of such
Shares.
(d) The value of dividends and distributions which were
incorrectly credited on Shares because of the failure of the
Agent or its agents or subcontractors to timely post the
redemption or repurchase of such Shares;
(e) The value of dividends and distributions, some portion of
which was incorrectly credited, or was not credited, on Shares
because of the application by the Agent or its agents or
subcontractors of an incorrect dividend or distribution factor
or otherwise;
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<PAGE>
(f) Penalties and interest which the Company is required to pay
because of the failure of the Agent or its agents or
subcontractors to comply with the information reporting and
withholding (including backup withholding) requirements of the
Internal Revenue Code of 1986, as amended, and applicable
Treasury regulations thereunder, applicable to Company
Shareholder accounts; and
(g) Interest in accordance with the laws of The Commonwealth of
Massachusetts on any damages from the date of the breach of
this Agreement.
5.06. In order that the indemnification provisions contained in this
Article 5 shall apply, upon the assertion of a claim or loss for which either
party may be required to indemnify the other, the party seeking indemnification
shall promptly notify the other party of such assertion or loss, 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
at its expense 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.
The obligations of the parties hereto under this Article 5 shall survive
the termination of this Agreement.
Article 6. Covenants of the Company and the Agent.
6.01. The Company shall promptly furnish to the Agent the following:
(a) A certified copy of the resolution of the Board of Directors of
the Company authorizing the appointment of the Agent and the execution and
delivery of this Agreement.
(b) A copy of the Articles of Incorporation and By-Laws of the
Company and all amendments hereto.
6.02. The Agent hereby agrees to establish and maintain facilities and
procedures reasonably acceptable to the Company 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.
6.03. The Agent shall at all times maintain insurance coverage which is
reasonable and customary in light of its duties hereunder and its other
obligations and activities.
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<PAGE>
6.04. The Agent shall keep records relating to the services to be
performed hereunder, in the form and manner as it may deem advisable. To the
extent required by Section 31 of the Investment Company Act of 1940, as amended
(the "Act") and the Rules thereunder, the Agent agrees that all such records
prepared or maintained by the Agent relating to the services to be performed by
the Agent hereunder are the property of the Company and will be preserved,
maintained and made available in accordance with such Section and Rules, and
will be surrendered promptly to the Company, free of charge, and in accordance
with its request. Records surrendered hereunder may be in machine-readable form,
to the extent permitted by the Act and the Rules thereunder.
6.05. The Agent and the Company agree that all books, records, information
and data pertaining to the business of the other party (including the names and
addresses of Shareholders) which are exchanged or received pursuant to the
negotiation or the carrying out of this Agreement shall remain confidential and
shall not be voluntarily disclosed to any other person, except as may be
required by law.
6.06. In case of any requests or demands for the inspection of the
Shareholder records of the Company, the Agent will endeavor to notify the
Company and to secure instructions from an authorized officer of the Company as
to such inspection. The Agent reserves the right, however, to exhibit the
Shareholder records to any person whenever it is reasonably advised by its
counsel that it may be held liable for the failure to exhibit the Shareholder
records to such person.
6.07. The Agent agrees to maintain or provide for redundant facilities or
a compatible configuration and to maintain or provide for backup of the
Company's master and input files and to store such files in a secure
off-premises location so that in the event of a power failure or other
interruption of whatever cause at the location of such files the Company's
records are maintained intact and transactions can be processed at another
location.
6.08. The Agent acknowledges that the Company, as a registered investment
company under the Act, is subject to the provisions of the Act and the rules and
regulations thereunder, and that the offer and sale of the company's Shares are
subject to the provisions of federal and state laws and regulations applicable
to the offer and sale of securities. The Company acknowledges that the Agent is
not responsible for the Company's compliance with such laws and regulations. If
the Company advises the Agent that a procedure of the Agent related to the
discharge of its obligations hereunder has or may have the effect of causing the
Company to violate any of such laws or regulations, the Agent shall use its best
efforts to develop a mutually agreeable alternative procedure which does not
have such effect.
-12-
<PAGE>
6.09. The Agent shall promptly provide the Company with a copy of any
management letter issued by the outside auditors of the Agent on its internal
accounting controls.
Article 7. Termination of Agreement.
7.01. This Agreement may be terminated by either party upon one hundred
twenty (120) days' written notice to the other.
7.02. Should the Company exercise its right to terminate, all reasonable
out-of-pocket expenses of the Agent incurred with respect to the movement of
records and materials required by this Agreement will be borne by the Company.
Additionally, the Agent reserves the right to charge for any other reasonable
expenses associated with such termination.
Article 8. Additional Series.
8.01. In the event that the Company establishes one or more series of
Shares with respect to which it desires to have the Agent render services as
transfer agent under the terms hereof, it shall so notify the Agent in writing,
and unless the Agent objects in writing to providing such services, the term
"Company" hereunder, unless the context otherwise requires, shall be deemed to
include each such series of Shares. All recordkeeping and reporting shall be
done separately for each series. Unless the Company and Agent agree to an
amended fee schedule, the fee schedule attached hereto shall apply to each
series separately.
Article 9. Delegation.
9.01 Except as provided in Section 9.03 below, neither this Agreement nor
any rights or obligations hereunder may be delegated by either party without the
written consent of the other party.
9.02. This Agreement shall inure to the benefit of and be binding upon the
parties and their respective permitted successors and delegatees.
9.03. The Agent may, with notice to and consent on the part of the
Company, which consent shall not be unreasonably withheld, subcontract for the
performance of certain services under this Agreement to qualified service
providers, which shall be registered as transfer agents under Section 17A of the
Securities Exchange Act of 1934 if such registration is required; provided,
however, that the Agent shall be as fully responsible to the Company for the
acts and omissions of any subcontractor as it is for its own acts and omissions.
-13-
<PAGE>
Article 10. Amendment.
10.01. This Agreement may be amended or modified by a written agreement
executed by both parties and authorized or approved by a resolution of the Board
of Directors of each party.
Article 11. Massachusetts Law to Apply.
11.01. This Agreement shall be construed and the provisions thereof
interpreted under and in accordance with the laws of The Commonwealth of
Massachusetts.
Article 12. Form N-SAR.
12.01. The Agent shall maintain such records and provide such information
as shall enable the Company to fulfill the requirements of Form N-SAR or any
successor report which must be filed with the Securities and Exchange
Commission.
Article 13. Merger of Agreement.
13.01. 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 14. Counterparts.
14.01. This Agreement may be executed by the parties hereto in any number
of counterparts, and all of said counterparts taken together shall be deemed to
constitute one and the same instrument.
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: SCUDDER FUND, INC.
/s/ [Illegible] BY: /s/ [Illegible]
- ------------------------ ------------------------
Secretary Title: Treasurer
ATTEST: SCUDDER SERVICE CORPORATION
/s/ [Illegible] BY: /s/ [Illegible]
- ------------------------ ------------------------
Title: President
-14-
EXHIBIT 8(c)(i)
CUSTODIAN AGREEMENT
To: State Street London Limited
State Street House
12 Nicholas Lane
London EC4N 7BN
Great Britain
Gentlemen:
The undersigned State Street Bank and Trust Company ("State Street") hereby
requests that State Street London Limited (the "Trust Company") establish a cash
account at State Street's licensed London branch (or at such other
deposit-taking institution in the United Kingdom as State Street may designate)
and a custody account for each custody customer and employee benefit plan
account identified in the Schedule attached to this Agreement and each
additional account which is or may hereafter be identified to this Agreement.
Such customers and accounts are referred to herein as the "Customer" or
"Customers." Each such cash account and each such custody account so
established will be referred to herein as the "Cash Account" and "Custody
Account," respectively, and will be subject to the following terms and
conditions:
1. The Trust Company shall hold in trust as agent for State Street and
shall physically segregate in the Cash Account and Custody Account,
respectively, such cash, bullion, coin, stocks, shares, bonds,
debentures, notes and other securities and other property which is
delivered to the Bank for those State Street Accounts (the
"Property").
2. a. Upon the prior approval of State Street the Trust Company may
deposit Securities, as hereafter defined, in a securities
depository or utilize a clearing agency, incorporated or
organized under the laws of a country other than the United
States;
b. When securities held for a Customer are deposited in a
securities depository or clearing agency by the Trust Company,
the Trust Company shall identify on its books as belonging to
State Street as agent for the Customer, the securities so
deposited.
0959k/1
<PAGE>
3. Upon the written instructions of State Street, in accordance with
Paragraph 7, the Trust Company is authorized to direct the payment
of cash from the Cash Account and to sell, assign, transfer, deliver
or exchange, or to purchase for the Custody Account, any and all
stocks, shares, bonds, debentures, notes and other securities
("Securities"), bullion, coin, and any other property, but only as
provided in such written instructions. So long as and to the extent
that it exercises reasonable care, the Trust Company shall not be
responsible for the title, validity or genuineness of any Property
or evidence of title thereto received by it or delivered by it and
shall be held harmless in acting upon any written instruction
reasonably believed by it to be genuine and to be signed by the
proper party or parties.
4. Unless the Trust Company receives written instructions of State
Street to the contrary, the Trust Company is authorized:
a. To promptly receive and collect all income and principal with
respect to the Property and to deposit cash receipts in the
Cash Account;
b. To promptly exchange securities where the exchange is purely
ministerial (including, without limitation, the exchange of
temporary securities for those in definitive form and the
exchange of warrants, or other documents of entitlement to
securities, for the securities themselves);
c. To promptly surrender securities at maturity or when called
for redemption upon receiving payment therefor;
d. Whenever notification of a rights entitlement or a fractional
interest resulting from a rights issue, stock dividend or
stock split is received for securities in the Custody Account
and such rights entitlement or fractional interest bears an
expiration date, the Trust Company will endeavor to obtain
State Street Bank's instructions, but should these not be
received in time for the Trust Company to take timely action,
the Trust Company is authorized to sell such rights
entitlement or fractional interest and to credit the Custody
Account;
e. To hold registered in the name of the nominee of the Trust
Company or its agents such Securities as are ordinarily held
in registered form;
f. To execute in State Street's name for the Customer, whenever
the Trust Company deems it appropriate, such ownership and
other certificates as may be required to obtain the payment of
income from the Property; and
g. To pay or cause to be paid, from the Cash Account any and all
taxes and levies in the nature of taxes imposed on such assets
by any governmental authority and shall use reasonable
efforts, to promptly reclaim any foreign withholding tax
relating to the Cash Account.
0959k/2
<PAGE>
5. If the Trust Company shall receive any proxies, notices, reports or
other communications relative to any of the Securities of the
Custody Account in connection with tender offers, reorganization,
mergers, consolidations, or similar events which may have an impact
upon the issuer thereof, the Trust Company shall promptly transmit
any such communication to State Street by means as will permit State
Street to take timely action with respect thereto.
6. The Trust Company is authorized in its discretion to appoint brokers
and agents in connection with the Trust Company's handling of
transactions relating to the Property provided that any such
appointment shall not relieve the Trust Company of any of its
responsibilities or liabilities hereunder.
7. Written instructions shall include (i) instructions in writing
signed by such persons as are designated in writing by State Street;
(ii) telex or tested telex instructions of State Street; (iii) other
forms of instruction in computer readable form as shall be
customarily utilized for the transmission of like information; and
(iv) such other forms of communication as from time to time shall be
agreed upon by State Street and the Trust Company.
8. The Trust Company shall supply periodic reports with respect to the
safekeeping of assets held by it under this Agreement. The content
of such reports shall include but not be limited to any transfer to
or from any account held by the Trust Company hereunder and such
other information as State Street may reasonably request.
9. In addition to its obligations under Section 2b hereof, the Trust
Company shall maintain such other records as may be necessary to
identify the assets hereunder as belonging to each Customer.
10. The Trust Company agrees that its books and records relating to its
actions under this Agreement shall be opened to the physical,
on-premises inspection and audit at reasonable times by officers of,
auditors employed by or other representatives of State Street
(including to the extent permitted under applicable law the
independent public accountants for any Customer) and shall be
retained for such period as shall be agreed by State Street and the
Trust Company.
11. The Trust Company shall be entitled to reasonable compensation for
its services and expenses as custodian under this Agreement, as
agreed upon from time to time by the Trust Company and State Street.
12. a. The Trust Company shall exercise reasonable care in carrying
out the provisions of this Agreement, but shall be kept
indemnified by and shall be without liability for any action
taken or omitted by it in good faith without negligence. It
shall be entitled to rely on and may act upon advice of
counsel (who may be counsel for the Trust Company, State
Street or both) on all matters, and shall be without liability
for any action reasonably taken or omitted pursuant to such
advice.
0959k/3
<PAGE>
b. If State Street requires the Trust Company to take action with
respect to the Securities, which action involves the payment
of money or which action may, in the opinion of the Trust
Company, result in the Trust Company being liable for the
payment of money or incurring liability of some other form,
State Street, as a prerequisite to requiring the Trust Company
to take action, shall provide indemnity to the Trust Company
in an amount and form satisfactory to it.
13. The Trust Company shall not be liable for any loss resulting from
political risks such as exchange control restrictions,
expropriation, nationalization, insurrection, civil strife, armed
hostilities or other similar events or any loss resulting from Acts
of God, nuclear incident and the like under circumstances where the
Trust Company has exercised reasonable care.
14. The Trust Company agrees (i) the property held hereunder is not
subject to any right, charge, security interest, lien or claim of
any kind in favor of the Trust Company or any of its agents or its
creditors except a claim of payment for their safe custody and
administration and (ii) the beneficial ownership of the Property
shall be freely transferable without the payment of money or other
value other than for safe custody or administration.
15. This Agreement may be terminated by the Trust Company or State
Street by 60 days' written notice to the other, sent by registered
mail or express courier. The Trust Company, upon the date this
Agreement terminates pursuant to notice which has been given in a
timely fashion, shall deliver the Property to the Customer unless
the Trust Company has received written instructions of State Street
specifying the name(s) of the person(s) to whom the Property shall
be delivered.
16. The Trust Company and State Street shall each use its best efforts
to maintain the confidentiality of the Property in each Cash Account
and Custody Account, subject, however, to the provisions of any laws
requiring the disclosure of the Property.
17. Unless otherwise specified in this Agreement, all notices with
respect to matters contemplated by this Agreement shall be deemed
duly given when received in writing or by confirmed telex by the
Trust Company or State Street at their respective addresses set
forth below, or at such other address as be specified in each case
in a notice similarly given:
To State Street Master Trust Division, Global Custody
STATE STREET BANK AND TRUST COMPANY
P.O. Box 1713
Boston, Massachusetts 02105
U.S.A.
To the Trust Company ATTN:________________________________
STATE STREET LONDON LIMITED
State Street House
12 Nicholas Lane
London EC4N 7BN
Great Britain
0959k/4
<PAGE>
18. This Agreement shall be governed by and construed in accordance with
the laws of the United Kingdom except to the extent that such laws
are preempted by the laws of the United States of America.
Please acknowledge your agreement to the foregoing by executing a copy of this
letter.
Very truly yours,
STATE STREET BANK AND TRUST COMPANY
By: [Illegible]
-----------------------------
Vice President
Date: [Illegible]
---------------------------
Agreed to by: STATE STREET LONDON LIMITED
By: [Illegible] Director
- ------------------------------
Date: [Illegible]
------------------------
0959k/5
EXHIBIT 8(c)(ii)
STATE STREET/BANKERS TRUST SUBCUSTODIAL
ARRANGEMENT
<PAGE>
1
SUBCUSTODIAN AGREEMENT
The undersigned custodian (the "Custodian") for each of the investment
companies (each such investment company is herein referred to as the "Fund")
identified in EXHIBIT #2 of the OPERATING PROCEDURES attached hereto as APPENDIX
I and, as amended from time to time, made a part hereof, hereby appoints on the
following terms and conditions Bankers Trust Company as subcustodian (the
"Subcustodian") for it and the Subcustodian hereby accepts such appointment on
the following terms and conditions as of the date set forth below.
1. Qualification. The Custodian and the Subcustodian each represents
to the other and to the Fund that it is qualified to act as a custodian for a
registered investment company under the Investment Company Act of 1940, as
amended (the "1940 Act").
2. Subcustody. The Subcustodian agrees to maintain a separate account and
to hold segregated at all times from the Subcustodian's securities and from all
other customers' securities held by the Subcustodian, all the Fund's securities
and evidence of rights thereto ("Fund Securities") deposited, from time to time
by the Custodian's authorized representative with the Subcustodian. The
Subcustodian will accept, hold or dispose of and take other actions with respect
to Fund Securities in accordance with the instructions of the Custodian given in
the manner set forth in Section 4 and will take certain other actions as
specified in Section 3. The Subcustodian may take steps to register and continue
to hold Fund Securities in the name of the Subcustodian's nominee and shall take
such other steps as the Subcustodian believes necessary or appropriate to carry
out efficiently the terms of this Agreement. To the extent that ownership of
Fund Securities may be recorded by a book entry system maintained by any
transfer agent or registrar for such Fund Securities or as Depositor, Trust
Company, the Subcustodian may hold Fund Securities as a book entry reflecting
the ownership of such Fund Securities by its nominee and need not possess
certificates or any other evidence of ownership of Fund Securities. The
Subcustodian shall identify on its records Fund Securities which are held in a
book entry system.
3. Subcustodian's Acts Without Instructions. Except as otherwise
instructed pursuant to Section 4, the Subcustodian will (i) present all Fund
Securities requiring presentation for any payment thereon, (ii) distribute to
the Custodian cash received thereon, (iii) collect and distribute to the
Custodian interest and any dividends and distributions on Fund Securities, (iv)
at the request of the Custodian, or on its [illegible]
<PAGE>
2
execute any necessary declarations or certificates of ownership (provided by the
Custodian or on its behalf) under any tax law now or hereafter in effect, (v)
forward to the Custodian, or notify it by telephone of, confirmations, notices,
proxies or proxy soliciting materials relating to the Fund Securities received
by it as registered holder (and the Custodian agrees to forward same to the
Fund), (vi) report to the Custodian any missed payment or other default upon any
Fund Securities known to it as Subcustodian and (vii) make no free, delivery of
Fund Securities to anyone other than the Custodian. Promptly after the
Subcustodian is furnished with any report of its independent public accountants
on an examination of its internal accounting controls and procedures for
safeguarding securities held in its custody as subcustodian under this Agreement
or under similar agreements, the Subcustodian will furnish a copy thereof to the
Custodian.
4. Instructions, Other Communications. Any officer of the Custodian
designated from time to time by letter to the Subcustodian, signed by the
President or any Vice President and any Assistant Vice President, Assistant
Secretary or Assistant Treasurer of the Custodian, as an officer of the
Custodian authorized to give instructions to the Subcustodian with respect to
Fund Securities (the "Authorized Officer"), shall be authorized to instruct the
Subcustodian as to the acceptances, holding, presentation, disposition or any
other action with respect to Fund Securities from time to time by telephone, or
in writing signed by such Authorized Officer and delivered by tested telex,
tested computer printout or such other reasonable method as the Custodian and
Subcustodian shall agree is designed to prevent unauthorized officer's
instructions; provided, however, the Subcustodian is authorized to accept and
act upon orders from the Custodian, whether orally, by telephone or otherwise,
which the Subcustodian reasonably believes to be given by an authorized person.
The Subcustodian will promptly transmit to the Custodian all receipts and
transaction confirmations in respect of Fund Securities as to which the
Subcustodian has received any instructions. The Authorized Officers shall be as
set forth on EXHIBIT #1 of the OPERATING PROCEDURES. The Subcustodian will
furnish a weekly statement relating to the account which shall reflect Fund
Securities held in the account at the date of such statement.
5. Liabilities. (i) The Subcustodian shall not be liable for any action
taken or omitted to be taken in carrying out the terms and provision of this
Agreement if done without willful malfeasance, bad faith, negligence or reckless
disregard of its obligations and duties under this Agreement. Except as
otherwise set forth herein, the Subcustodian shall have no responsibility for
ascertaining or acting upon any calls, conversions, exchange offers, tenders,
interest rate changes or similar matters relating to the Fund
<PAGE>
3
Securities (except at the instructions of the Custodian), nor for informing the
Custodian with respect thereto, whether or not the Subcustodian has, or is
deemed to have, knowledge of the aforesaid. The Subcustodian is under no duty to
supervise or to provide investment counseling or advice to the Custodian or the
Fund relative to the purchase, sale, retention or other disposition of any Fund
Securities held hereunder. The Subcustodian shall for the benefit of the
Custodian and the Fund use the same care with respect to receiving, safekeeping,
handling and delivery of Fund Securities as it uses in respect of its own
securities.
(ii) The Subcustodian will indemnify, defend and save harmless the
Custodian and the Fund from and against all loss, liability, claims and demands
incurred by the Custodian or the Fund arising out of or in connection with the
Subcustodian's willful malfeasance, bad faith, negligence or reckless disregard
of its obligations and duties under this Agreement.
(iii) The Subcustodian agrees to be responsible for and indemnify the
Subcustodian and any nominee in whose name the Fund Securities are registered,
from and against all loss, liability, claims and demands incurred by the
Subcustodian and the nominee in connection with performance of any activity
pursuant to this Agreement, done in good faith and without negligence, including
any expenses, taxes or other charges which the Subcustodian is required to pay
in connection therewith.
6. Each party may terminate this Agreement at any time by not less than
ten (10) business days' prior written notice. In the event that such notice is
given, the Subcustodian shall make delivery of the Fund Securities held in the
Subcustodian account to the Custodian or to any third party within the Borough
of Manhattan, specified by the Custodian in writing within ten (10) days of
receipt of the termination notice, at the Custodian's expense.
7. All communications required or permitted to be given under this
Agreement, unless otherwise agreed by the parties, shall be addressed as
follows:
(i) to the Subcustodian:
Bankers Trust Company
1 Bankers Trust Plaza
22nd Floor
New York, NY 10015
Attention: Barbara Walter
EMD Safekeeping Unit
<PAGE>
4
(ii) to the Custodian:
State Street Bank and Trust Company
1776 Heritage Drive
Quincy, Massachusetts 02171
Attn.: Mutual Funds Service Administration
3. Miscellaneous: This Agreement (i) shall be governed by and construed in
accordance with the laws of the State of New York, (ii) may be executed in
counterparts each of which shall be deemed an original but all of which shall
constitute the same instrument, and (iii) may be amended by the parties hereto
in writing.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
date set forth below.
Dated: August 21, 1986
STATE STREET BANK & TRUST COMPANY
As Custodian
By: /s/ [Illegible]
-----------------------------
Title: Vice President
BANKERS TRUST COMPANY
As Subcustodian
By: /s/ [Illegible]
-----------------------------
Title: Senior V P
-------------------------
<PAGE>
APPENDIX I
State Street/Bankers Trust Subcustodial Arrangement
for "TENR" Immobilization Program
OPERATING PROCEDURES
Subject to the SUBCUSTODIAN AGREEMENT dated August 21, 1986 as executed between
State Street Bank and Trust Company as Custodian and Bankers Trust Company as
Subcustodian for the approved Funds, the following Operating Procedures shall
apply to the custody of "TENR" securities purchased by or on behalf of the
Funds:
I. Authorizations
EXHIBIT #1 attached hereto. and as amended from time to time, is a listing of
the State Street Bank and Trust Company [SSB] personnel authorized to provide
instructions to Bankers Trust Company as Subcustodian (BTCoS] under the terms of
the SUBCUSTODIAN AGREEMENT. BTCoS representatives by function are:
Purchase/Sale - Instructions & Settlement Confirmation
John Couturier (212) 618 - 3671
Nelson Velasquez (212) 618 - 3667
Gary Reed (212) 618 - 3687
Catherine Kroebel (212) 618 - 3649(BACKUP ONLY)
Interest Payment, Position, Historical Transaction Inquiries
Victoria Arroyo (212) 250 - 7885
Subcustodial Responsibilities
Barbara Walter (212) 250 - 7866
II. Standing Instructions
SSB will provide BTCoS with standing instructions for interest/redemption
proceeds in Federal Funds and for telecopier numbers for transaction clearance
confirmation. These instructions are incorporated hereto.
III. Purchases
When a Fund enters into a transaction with Bankers Trust Company Municipal
Dealer Department (Dealer) to purchase a "TENR" position, the Fund will notify a
SSB Administrator. The SSB Administrator will provide trade authorization
information (using the trade instruction/confirmation form attached) to BTCoS
via telecopier by 1:00 p.m. if SSB has received instructions by 12:00 noon.
BTCoS telecopier numbers are:
Rapicom 5000 (212) 619 - 3826 Primary Unit
Rapicom 5000 (212) 619 - 3823 Back Up Unit Only
SSB will notify BTCoS of transmissions via telephone and BTCoS will acknowledge
receipt of instructions via telephone. BTCoS will follow the Verification
procedures (see V. below) and confirm receipt of securities in settlement of the
transaction on settlement date (using the trade instruction/confirmation form
attached) to SSB via telecopier by 3:30 p.m.
<PAGE>
2
The confirmation of receipt will be sent by BTCoS to the SSB telecopier number
indicated on the trade instruction/confirmation form.
SSB will then forward a Fed Funds wire to Dealer for the purchase amount
formatted as follows:
Bankers Trust Company N.Y.C.
Attn.: Muni #88/DSK Cage #99 - 401 - 356
F/B/O FUND NAME & SECURITIES DESC.
In the event that time guidelines can not be adhered to, instruction relay and
confirmation will be handled on a "best efforts" basis.
IV. Sales
The basic procedures and time guidelines for settlement of sale transactions are
as indicated above for purchases. When a Fund enters into a transaction with
Dealer to sell a "TENR" position, the Fund will notify a SSB Administrator. The
SSB Administrator will provide trade authorization information to BTCoS via
telecopier, BTCoS will acknowledge and follow Verification procedures.
BTCoS will withdraw securities from the Fund inventory and deliver to Dealer
with instructions to forward a Fed Funds wire to SSB (ABA #011000028) for the
sale amount formatted as follows:
State Street Bank and Trust Company, Boston
Attn: Mutual Funds Services Division
F/B/O FUND NAME
BTCoS will confirm delivery of securities in settlement of the transaction on
settlement date to SSB via telecopier.
V. Verification
BTCoS will compare all instructions to Dealer and advise SSB of any
discrepancies. SSB will contact the Fund and report back to BTCoS on the
discrepancies. Trades will not be settled until verified by all parties. All
changes to the original instructions must be documented and authorized by SSB
(using the trade instruction/confirmation form attached) and forwarded to BTCoS
via telecopier. All trades which can not be settled on intended settlement date
will be considered failed trades and followed for settlement on subsequent
business days.
VI. Interest Payments
Interest will be wired in Fed Funds by BTCoS to SSB on the date that BTCoS
received interest payment value. Payments will be
<PAGE>
3
formatted as follows:
State Street Bank and Trust Company, Boston
Attn: Mutual Funds Services Division
F/B/O FUND NAME
SEC DESC &/or CUSIP #
VII. Stated Maturity Redemptions
BTCoS will present all securities for redemption at stated maturity date.
Redemption proceeds will be wired in Fed Funds by BTCoS to SSB on the date that
BTCoS receives redemption proceeds value. Payments will be formatted as follows:
State Street Bank and Trust Company, Boston
Attn: Mutual Fund Services Division
F/B/O FUND NAME
SEC DESC &/or CUSIP #
VIII. Reporting
BTCoS will mail a weekly statement of position and a monthly statement of
position (as of the last business day of each month) to SSB at:
State Street Bank and Trust Company
1776 Heritage Drive
Quincy, Massachusetts 02171
Attn: Mutual Funds Services Administration
IX. Applicability of Operating Procedures
These procedures will apply for all Funds approved for the subcustodial
arrangement. The Funds as set forth on EXHIBIT #2 attached hereto will be
covered by these procedures. As additional Funds are approved for the
Subcustodial Arrangement, EXHIBIT #2 will be amended. Unless otherwise set forth
in writing, these operating procedures shall apply as stated to all Funds listed
on EXHIBIT #2.
The procedures set forth in this "working document" will be met on a "best
effort" basis and shall remain in force until such time that the SUBCUSTODIAN
AGREEMENT is terminated.
Agreed to & Accepted by:
State Street Bank and Trust Company
As Custodian
By: /s/ [Illegible] Signature: /s/ [Illegible]
----------------------- --------------------------
Title: Vice President Date: Aug. 20, 1986
--------------------
Bankers Trust Company
As Subcustodian
By: /s/ [Illegible] Signature: /s/ [Illegible]
----------------------- --------------------------
Title: SVP Date: [Illegible], 1986
--------------------
<PAGE>
STATE STREET BANK/BANKERS TRUST SUBCUSTODIAL ARRANGEMENT
"TENR" IMMOBILIZATION PROGRAM *************************
* *
TRADE INSTRUCTION/CONFIRMATION FORM * BUY or SELL *
* *
========================================================================
TO: BTCo, 16 WALL ST-5TH FLOOR, NYC ATTN.: J. COUTURIER - DSK CAGE
TELECOPIER # : (212) 619 - 3828
[ ] RECEIVE {BUY}
WE AUTHORIZE BTCo AS SUBCUSTODIAN TO: OR
[ ] DELIVER {SELL}.
THE FOLLOWING SECURITIES FOR OUR ACCOUNT:
FUND NAME: ________________________ FUND NUMBER:_______________________
TRADE DATE: ___________________ SETTLEMENT DATE: __________________
BROKER/CONTRAPARTY: BANKERS TRUST DEALER
CUSIP #: ________________ MATURITY DATE: ____________________________
SECURITY DESCRIPTION: __________________________________________________
[issuer, proj., series, rate, dtd. date]
________________________________________________________________________
________________________________________________________________________
PAR VALUE: _____________________ x UNIT PRICE: _______________________
ACCRUED INTEREST: ______________ NET AMOUNT: _________________________
ACCOUNT CONTROLLER: ____________________________________________________
STATE STREET BANK AUTHORIZATION: _______________________________________
STATE STREET BANK AUTHORIZATION: _______________________________________
========================================================================
PLEASE INFORM STATE STREET BANK OF ANY DISCREPANCIES BY 2:00 P.M.
- ------------------------------------------------------------------------
DISCREPANCY RESOLUTION/CHANGES: ________________________________________
________________________________________________________________________
STATE STREET BANK AUTHORIZATION:________________________________________
========================================================================
TO:SSB, 1776 HERITAGE DRIVE, QUINCY, MASS.,ATTN: MUTUAL FUNDS SERVICE ADMIN
TELECOPIER NUMBER : (617) ___ ___ ___ - ___ ___ ___ PRIMARY
TELECOPIER NUMBER : (617) ___ ___ ___ - ___ ___ ___ BACKUP ONLY
WE CONFIRM TO SSB AS CUSTODIAN THAT ABOVE REFERENCE SECURITIES WERE:
[ ] RECEIVED (BUY). PLEASE WIRE FED FUNDS IN THE NET AMOUNT,
OR
[ ] DELIVERED (SELL). PLEASE FOLLOW FOR FED FUNDS IN THE NET AMOUNT
BTCo. REPRESENTATIVE: _________________________ BTCo REF #: _____________
DATE: ___________
========================================================================
<PAGE>
BANKERS TRUST SUBCUSTODIAN AGREEMENT
EXHIBIT #2
TO OPERATING PROCEDURES
DATED August 21, 1986
APPROVED FUNDS
THE AUTHORIZED FUNDS PURSUANT TO SECTION IX. OF THE OPERATING PROCEDURES ARE:
Name of Fund Fund Number
------------ -----------
Scudder Fund, Inc.
Scudder Managed Tax-Free Fund 4506
Scudder Institutional Fund, Inc.
Scudder Institutional Tax-Free Portfolio 4510
EXHIBIT 8(c)(iii)
SUBCUSTODIAN AGREEMENT
between
BANKERS TRUST COMPANY
and
STATE STREET BANK AND TRUST COMPANY
<PAGE>
Sub-Custodian Agreement
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"), hereby appoints Bankers Trust
Company, a New York banking corporation, having its principal place of business
at 4 Albany Street, New York, New York 10015, (hereinafter called the
"Sub-Custodian") to serve as Sub-Custodian and to hold such securities as the
Custodian may designate on behalf of and upon the instructions of the
appropriate entity listed on Exhibit A attached hereto (each a "Fund" and
collectively, the "Funds") for which the Custodian is custodian, subject to the
terms and conditions set forth herein.
1. Representation by Sub-Custodian.
The Sub-Custodian hereby represents that it is qualified to act as
custodian for a registered investment company under the Investment Company Act
of 1940, as amended, and that it has aggregate capital, surplus and undivided
profits, as shown by its last published report, of not less than $25,000,000.
2. Custodian Services.
The Sub-Custodian shall hold in an account in the name of the Custodian,
as custodian for the Funds, securities registered in the name of the
Sub-Custodian's nominee (the "Account") and owned by each such Fund. Such
securities shall be designated by
<PAGE>
the Custodian upon instructions of the appropriate Fund and shall consist of
bonds or notes of any issue that (a) are tax exempt, (b) incorporate an
adjustable interest rate that is convertible to interest rates determinable on a
variable or a fixed rate basis, (c) entitle the owners of such securities to
have such securities purchased at specified times and (d) require the services
of a custodian (which may be the Sub-Custodian) to establish a book-entry system
similar to that set forth in the Relevant Master Custody Agreement (as
hereinafter defined in paragraph 13 hereof). Such securities may be commingled
with other securities of the same issue or with other securities held in a
fiduciary or custodial capacity but shall be physically segregated from all
securities held in the Sub-Custodian's individual capacity or for its account.
Subject to paragraph 13 hereof, the Sub-Custodian shall release and deliver such
securities only upon receipt of instructions from the Custodian.
The Sub-Custodian shall collect on a timely basis, and credit to each
Fund's Sub-Custodial account, all income and other payments with respect to
securities held under this Agreement to which such Fund is entitled as owner of
the securities and shall notify the Custodian of any income or other payments
that are not collected within a reasonable time after they become payable.
Payments of income are to be made by wire advice to the account of each Fund so
specified on Exhibit A.
The Sub-Custodian shall at no time supervise the investment of, or advise
or make any recommendations for the sale, purchase or other disposition of
securities held under this Agreement.
-2-
<PAGE>
All purchase and sale transactions shall be carried out by the Sub-Custodian
only as the Custodian may instruct pursuant to paragraph 3 hereof.
3. Instructions.
Subject to paragraph 13 hereof, instructions furnished by the Custodian
to the Sub-Custodian with respect to securities held by the Sub-Custodian under
this Agreement shall be signed by such officer or officers of the Custodian as
are authorized from time to time by the Custodian; provided, however, that the
Sub-Custodian is authorized to accept and act upon orders from the Custodian,
whether given orally, by telephone or otherwise, which the Sub-Custodian
reasonably believes to be given by an authorized person and the Sub-Custodian
shall be entitled to rely on such written or oral authorization provided it has
no actual knowledge to the contrary. The Custodian shall confirm such orders in
writing. The Sub-Custodian shall use the same care with respect to the
receiving, safekeeping, handling and delivering of securities held under this
Agreement as it uses in respect of its own similar securities, but it need not
maintain any special insurance for the benefit of the Custodian or the Funds
unless it may be required to do so by applicable law, in which case the costs of
any such insurance shall be an additional charge to the Custodian or the Funds.
The Sub-Custodian shall not be liable for any action taken or thing done by it
in carrying out the terms and provisions of this Agreement or the Relevant
Master Custody Agreement if done in good faith and
-3-
<PAGE>
without negligence or wilful misconduct on the Sub-Custodian's part. The
Custodian shall not be liable for any action taken or thing done by it in
carrying out the terms and provisions of this Agreement if done in good faith
and without negligence or misconduct on the Custodian's part. The Sub-Custodian
shall have no authority to select any broker or similar agent used to effect the
purchase and sale of securities.
4. Ownership Certificates for Tax Purposes and Indemnification.
The Sub-Custodian shall execute, as Custodian (as defined in Section 13
hereof), any necessary declarations or certificates of ownership required under
any tax law now or hereafter in effect.
The Custodian agrees to indemnify the Sub-Custodian and any nominee in
whose name securities hereunder are registered against, and hold it harmless
from, any liabilities, and any related out-of-pocket expenses, which it may
incur in connection with this Agreement, other than any liabilities and expenses
arising out of that Sub-Custodian's bad faith, wilful misconduct or negligence.
The Sub-Custodian agrees to indemnify the Custodian against, and to hold it
harmless from, any liabilities, and any related out-of-pocket expenses, which it
may incur in connection with this Agreement which arise out of the
Sub-Custodian's bad faith, negligence or wilful misconduct.
At the election of the Custodian, it shall be entitled to be subrogated to
the rights of the Sub-Custodian with respect to any claim against any person the
Sub-Custodian may have as a consequence of any such loss, expense or damage, if,
and to the
-4-
<PAGE>
extent the Custodian has not been made whole for any such loss, expense or
damage.
5. Reports by Sub-Custodian's Independent Public Accountants.
To the extent permitted by applicable law the Sub-Custodian shall provide
the Custodian, upon request, with any quarterly or annual reports prepared in
the normal course of business of the Sub-Custodian by the Sub-Custodian's
independent public accountants on the accounting system, internal accounting
controls and procedures for safeguarding securities relating to the services
provided by the Sub-Custodian under this Agreement.
6. Access to Records.
To the extent permitted by applicable law the Sub-Custodian will not
refuse any reasonable request for inspection and audit on its books and records
by an agent of a Fund or Custodian.
7. Cooperation.
The Sub-Custodian shall cooperate with each Fund and Custodian and their
respective independent public accountants in connection with annual and other
audits of the books and records of Custodian or the Fund.
8. Compensation of Sub-Custodian.
The Sub-Custodian shall be entitled to reasonable compensation for its
services and expenses as Sub-Custodian, as agreed upon in writing (at the time
of delivery of the Agreement)
-5-
<PAGE>
from time to time by and between the Sub-Custodian and the Custodian.
9. Effective Period, Termination and Amendment.
This Agreement 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 thirty (30) days after the date of such delivery or mailing; provided,
however, that the Agreement shall not be amended or terminated in contravention
of any applicable federal or state regulations, or any provision of the
custodial agreements entered into between the Custodian and the separate Funds,
and further, provided that the Custodian may immediately terminate this
Agreement in the event of the appointment of a conservator or receiver for the
Sub-Custodian by the appropriate federal supervisory authority or upon the
happening of a like event at the direction of an appropriate regulatory agency
or court of competent jurisdiction.
Upon termination of this Agreement, the Sub-Custodian shall promptly
deliver to the Custodian in person in New York or by registered mail all
property by delivery of appropriate certificates then held by the Sub-Custodian
under this Agreement.
-6-
<PAGE>
10. Interpretive and Additional Provisions.
In connection with the operation of this Agreement, the Sub-Custodian and
the Custodian may from time to time agree in writing 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,
which 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 custodian agreements entered into between the Custodian and the
separate Funds. No interpretive or additional provisions made as provided in the
preceding sentence shall be deemed to be an amendment of this Agreement.
11. New York Law to Apply.
This Agreement shall be construed and the provisions thereof interpreted
under and in accordance with the laws of the State of New York.
12. Communications Received by the Sub-Custodian.
The Sub-Custodian shall promptly transmit to the Custodian all
communications it receives concerning the securities it holds under this
Agreement and shall furnish statements of account in such manner and frequency
as the Sub-Custodian and the Custodian shall agree.
All communications required or permitted to be given under this Agreement
shall be in writing (including telecopy or
-7-
<PAGE>
telegraph) unless expressly provided otherwise, and addressed as follows:
(a) If to the Sub-Custodian: Bankers Trust Company
4 Albany Street
New York, New York 10015
Attn: Corporate Trust and
Agency Group
(b) If to the Custodian: State Street Bank & Trust Company
Mutual Fund Services
P.O. Box 1713
Boston, MA 02105
Attention:
13. Acknowledgement and Consent to Relevant Master Custody Agreement.
The Custodian acknowledges that such of the entities named on Exhibit B
hereto (as such Exhibit may be amended from time to time by notice from the
Sub-Custodian to the Custodian) has been appointed remarketing agent (each a
"Remarketing Agent") for certain series of securities held in custody pursuant
to this Agreement and that such Remarketing Agent and Bankers Trust Company, as
Custodian, (the "Master Custodian") have entered into a Master Custody Agreement
identified in such Exhibit as such Master Custody Agreement may be amended or
supplemented from time to time (each, a "Relevant Master Custody Agreement") for
the benefit of the owners of such series of securities held in custody pursuant
to this Agreement to promote the transfer of such series of securities
remarketed by such Remarketing Agent through a book-entry system maintained by
the Master Custodian. The Sub-Custodian will provide, upon request of the
Custodian,
-8-
<PAGE>
copies of each Relevant Master Custody Agreement for each series of securities
held in custody hereunder.
IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
executed this 15th day of August, 1989.
ATTEST: BANKERS TRUST COMPANY
/s/ [ILLEGIBLE] BY: /s/ [ILLEGIBLE]
- --------------------------- -------------------------------------
Assistant Secretary Title: Assistant Vice President
ATTEST: STATE STREET BANK AND TRUST COMPANY
/s/ [ILLEGIBLE] BY: /s/ [ILLEGIBLE]
- --------------------------- -------------------------------------
Assistant Secretary Vice President
-9-
<PAGE>
EXHIBIT B
Date of Relevant
Name of Master Custody
Remarketing Agreement with
Agent Bankers Trust Company
----------- ---------------------
Drexel Burnham Lambert Incorporated July 1, 1987
Tucker Anthony
Shearson Lehman Hutton October 1, 1989
Smith Barney, Harris Upham & Co. November 1, 1989
<PAGE>
STATE STREET BANK & TRUST/BANKERS TRUST COMPANY SUBCUSTODIAL
ARRANGEMENT FOR "DAILY DEMAND" PROGRAM
Operating Procedures
Subject to the Subcustodian Agreement dated August 15, 1989 as executed between
State Street Bank & Trust Company as Custodian, Bankers Trust Company as
Subcustodian, and the involved Funds (the "Agreement")
I. Authorizations
Attached is a listing of the State Street Bank & Trust Company ("State Street")
personnel authorized to provide instructions to Bankers Trust Company as
Subcustodian ("BTCo") under the terms of the agreement (Exhibit C to the
Agreement). BTCo representatives by function are:
Purchase/Sale - Instructions & Settlement Confirmation
------------------------------------------------------
Beverlyn Ebanks (212) 250-6770
Vanessa Belfon (212) 250-6587 (BACKUP ONLY)
Interest Payment, Position, Historical Transaction Inquiries
------------------------------------------------------------
Beverlyn Ebanks (212) 250-6770
Subcustodial Responsibilities
-----------------------------
Susan Kaufmann (212) 250-6565
II. Standing Instructions
State Street's standing instructions for interest/redemption proceeds in Federal
Funds are specified on Exhibit A to the Agreement.
III. Purchases
When a Fund enters into a transaction with a remarketing agent as identified in
the appropriate agreement (Exhibit B to the Agreement) ("Remarketing Agent") to
purchase a "Daily Demand" position, the Fund will notify a State Street
administrator. The State Street administrator will provide trade authorization
information using the Trade Instruction/Confirmation Form (Exhibit D to the
Agreement) to BTCo via telecopier by 11:00 am if State Street has received
instructions by 11:00 am. BTCo telecopier numbers are:
(212) 250-6358
(212) 250-6727 BACK UP ONLY
State Street will notify BTCo of transmissions via telephone and BTCo will
acknowledge receipt of instructions via telephone. BTCo will follow the
verification procedures (see V below) and confirm receipt of securities in
settlement of the transaction on settlement date using the Trade
Instruction/Confirmation Form (Exhibit D to the Agreement) to State Street via
<PAGE>
telecopier by 1:30 PM as identified on Exhibit D to the Agreement. Oral
instructions may be accepted where time is of the essence to minimize fails as
long as followed immediately by normal instruction.
State Street will then forward a Fed Funds wire to Remarketing Agent for the
purchase amount.
In the event that time guidelines can not be adhered to, instruction relay and
confirmation will to handled on a "best efforts" basis.
IV. Sales.
The basic procedures and time guidelines for settlement of sale transactions are
as indicated above for purchases. When a fund enters into a transaction with
Remarketing Agent to sell a "Daily Demand" position, the Fund will notify a
State Street administrator. The State Street administrator will provide trade
authorization information to BTCo via telecopier, BTCo will acknowledge and
follow Verification procedures.
BTCo will withdraw securities from the Fund inventory and, upon receipt of funds
from the appropriate party per the Master Custody Agreement, will forward a Fed
Funds wire to State Street for the account of a specifically named Fund as
identified on Exhibit A to the Agreement for the sale amount.
BTCo will confirm delivery of securities in settlement of the transaction on
settlement date to State Street via telecopier.
V. Verification
BTCo will compare all instructions to Remarketing Agent's instructions and
advise State Street of any discrepancies. State Street will contact the Fund and
report back to BTCo on the discrepancies. Trades will not be settled until
verified by all parties. All charges to the original instructions must be
documented and authorized by State Street (using the trade
instruction/confirmation form attached) and forwarded to BTCo via telecopier.
All trades which cannot be settled on intended settlement date will be
considered failed trades and followed for settlement on subsequent business
days.
VI. Interest
Interest will be wired in Fed Funds by BTCo to State Street on the dated that
BTCo receives interest payment value. Payments of income are to be made by wire
advice to State Street for the account of each fund as specified on Exhibit A to
the Agreement.
VII. Stated Maturity Redemptions
BTCo will present all securities for redemption in sufficient time to receive
redemption proceeds at stated maturity date. Redemption proceeds will be wired
in Fed Funds by BTCo to State Street on the date that BTCo receives redemption
proceeds value. Payments of proceeds for maturities are to be made by wire
advice to State Street for the account of each fund so specified on Exhibit A to
the Agreement.
<PAGE>
VIII. Month End Reporting
BTCo will mail daily transaction confirmation statements and a monthly statement
of position as of the last business day of each month to State Street at:
State Street Bank & Trust Co.
P.O. Box 1713
Boston, MA 02105
Attn: Jerry Farrell
Fiduciary Control Dept.
IX. Applicability of Operating Procedures
These procedures will apply for all Funds approved for the subcustodial
arrangement for whom a Subcustodial Agreement has been fully executed. The Funds
as set forth on Exhibit A will be covered by these procedures. As additional
Funds enter into a Subcustodian Agreement, Exhibit A will be amended. Unless
otherwise set forth in writing, these operating procedures shall apply as stated
to all funds listed on Exhibit A.
The procedures set forth in this "working document" will be met on a "best
efforts" basis and shall remain in force until amended by an instrument that is
agreed to and signed by both parties or until such time that the Subcustodian
Agreement is terminated.
Agreed to & accepted by:
State Street Bank & Trust Company
as Custodian
By: E.D. Hawkes, Jr. Signature: /s/ E.D. Hawkes, Jr.
--------------------------- ------------------------------
Title: VICE PRESIDENT Date: SEP 18 1989
Bankers Trust Company
as Subcustodian
By: [ILLEGIBLE] Signature: /s/ [ILLEGIBLE]
--------------------------- ------------------------------
Title: Assistant Vice President Date: Sept 30, 1989
<PAGE>
[LOGO] LETTERHEAD OF STATE STREET
Bankers Trust Daily Demand Program
Trade Authorization
State Street Bank & Trust Company authorizes Bankers Trust to
____________________________ the following securities for the account of:
Receive (Buy)/Deliver (Sell)
Fund Name ____________________________ Fund # _________________________________
Trade Date _________________________ Settlement Date _________________________
Broker____________________________________
Security Description____________________________________________________________
Cusip # ________________________
Par Value ________________________________ X Unit Price________________________
+ Accrued Interest ___________________________ = Net Amount ____________________
Account Controller _____________________________________
Authorization __________________________________________
Authorization __________________________________________
________________________________________________________________________________
Transaction Confirmation
Please confirm this transaction by signing below and returning by fax to (617)
786-
Confirmed by: ___________________________ Title: _____________________________
Bankers Trust
________________________________________________________________________________
Payment for Buys
Upon confirmation by Bankers Trust, State Street Bank & Trust Co. will wire fed
funds to: _____________________________
FC0367L
<PAGE>
BANTERS TRUST DAILY DEMAND PROGRAM SUBCUSTODIAN AGREEMENT
EXHIBIT #A
DATED August 15, 1989
APPROVED FUNDS
THE AUTHORIZED FUNDS PURSUANT TO SECTION IX. OF THE OPERATING PROCEDURES ARE:
Wire instructions containing Account Location, Name and Fund Number for
receipt of funds pursuant to Section 2 of this Agreement are as follows:
ABA Routing Number: 0110-000-28
STATE ST BOS/ (insert appropriate fund name and number identified below)
Name of Fund Fund Number
------------ -----------
Scudder Fund, Inc.
Scudder Managed Tax-Free Fund 4506
Scudder Institutional Fund, Inc.
Scudder Institutional Tax-Free Portfolio 4510
EXHIBIT 8(c)(iv)
SUBCUSTODIAN AGREEMENT
between
IRVING TRUST COMPANY
and
STATE STREET BANK AND TRUST COMPANY
<PAGE>
Sub-Custodian Agreement
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"), hereby appoints Irving Trust
Company, a New York banking corporation, having its principal place of business
at One Wall Street, New York, Now York 10015, (hereinafter called the
"Sub-Custodian") to serve as Sub-Custodian and to hold such securities as the
Custodian may designate on behalf of and upon the instructions of the
appropriate entity listed on Exhibit A attached hereto (each a "Fund" and
collectively, the "Funds") for which the Custodian is custodian, subject to the
terms and conditions set forth herein.
1. Representation by Sub-Custodian.
The Sub-Custodian hereby represents that it is qualified to act as
custodian for a registered investment company under the Investment Company Act
of 1940, as amended, and that it has aggregate capital, surplus and undivided
profits, as shown by its last published report, of not less than $25,000,000.
2. Custodian Services.
The Sub-Custodian shall hold in an account in the name of the Custodian,
as custodian for the Funds, securities registered in the name of the
Sub-Custodian's nominee (the "Account") and owned by each such Fund. Such
securities shall be designated by
<PAGE>
the Custodian upon instructions of the appropriate Fund and shall consist of
bonds of any issue that (a) are tax exempt, (b) incorporate a daily adjustable
interest rate that is convertible to interest rates determinable on a variable
or a fixed rate basis, (c) entitle the owners of such securities to have such
securities purchased on on a daily basis or at certain other specified times and
(d) require the services of a custodian to establish a book-entry system similar
to that set forth in the Relevant Master Custody Agreement (as hereinafter
defined in paragraph 13 hereof). Such securities may be commingled with other
securities of the same issue or with other securities held in a fiduciary or
custodial capacity but shall be physically segregated from all securities held
in the Sub-Custodian's individual capacity or for its account. Subject to
paragraph 13 hereof, the Sub-Custodian shall release and deliver such securities
only upon receipt of instructions from the Custodian.
The Sub-Custodian shall collect on a timely basis, and credit to each
Fund's Sub-Custodial account, all income and other payments with respect to
securities held under this Agreement to which such Fund to entitled by law and
shall notify the Custodian of any income or other payments that are not
collected within a reasonable time after they become payable. Payments of income
are to be made by wire advice to the account of each Fund so specified on
Exhibit A.
The Sub-Custodian shall at no time supervise the investment of, or advise
or make any recommendations for the sale, purchase or other disposition of
securities held under this Agreement.
-2-
<PAGE>
All purchase and sale transactions shall be carried out by the Sub-Custodian
only as the Custodian may instruct pursuant to paragraph 3 hereof.
3. Instructions.
Subject to paragraph 13 hereof, instructions furnished by the Custodian to
the Sub-Custodian with respect to securities held by the Sub-Custodian under
this Agreement shall be signed by such officer or officers of the Custodian as
are authorized from time to time by the Custodian; provided, however, that the
Sub-Custodian is authorized to accept and act upon orders from the Custodian,
whether given orally, by telephone or otherwise, which the Sub-Custodian
reasonably believes to be given by an authorized person. The Custodian shall
confirm such orders in writing. The Sub-Custodian shall use the same care with
respect to the receiving, safekeeping, handling and delivering of securities
held under this Agreement as it uses in respect of its own similar securities,
but it need not maintain any special insurance for the benefit of the Custodian
or the Funds. The Sub-Custodian shall not be liable for any action taken or
thing done by it in carrying out the terms and provisions of this Agreement or
the Relevant Master Custody Agreement if done in good faith and without
negligence or misconduct on the Sub-Custodian's part. The Custodian shall not be
liable for any action taken or thing done by it in carrying out the terms and
provisions of this Agreement if done in good faith and without negligence or
misconduct on the Custodian's part. The
-3-
<PAGE>
Sub-Custodian shall have no authority to select any broker or similar agent used
to effect the purchase and sale of securities.
4. Ownership Certificates for Tax Purposes and Indemnification.
The Sub-Custodian shall execute, as Custodian (as defined in Section 13
hereof), any necessary declarations or certificates of ownership required under
any tax law now or hereafter in effect.
The Custodian agrees to indemnify the Sub-Custodian against, and hold it
harmless from, any liabilities, and any related out-of-pocket expenses, which it
may incur in connection with this Agreement, other than any liabilities and
expenses arising out of the Sub-Custodian's bad faith, wilful misconduct or
negligence. The Sub-Custodian agrees to indemnify the Custodian against, and to
hold it harmless from, any liabilities, and any related out-of-pocket expenses,
which it may incur in connection with this Agreement which arise out of the
Sub-Custodian's bad faith, negligence or wilful misconduct. The indemnification
provided hereunder by the Custodian and the Sub-Custodian shall not extend to
any special or consequential damages arising out of the performance of this
Agreement.
At the election of the Custodian, it shall be entitled to be subrogated to
the rights of the Sub-Custodian with respect to any claim against any person the
Sub-Custodian may have as a consequence of any such loss, expense or damage, if,
and to the extent the Custodian has not been made whole for any such loss,
expense or damage.
-4-
<PAGE>
3. Reports by Sub-Custodian's Independent Public Accountants.
The Sub-Custodian shall provide the Custodian, upon request, with any
quarterly or annual reports prepared in the normal course of business of the
Sub-Custodian by the Sub-Custodian's independent public accountants on the
accounting system, internal accounting controls and procedures for safeguarding
securities relating to the services provided by the Sub-Custodian under this
Agreement.
6. Access to Records.
The Sub-Custodian wi11 not refuse any reasonable request for inspection
and audit on its books and records by an agent of a Fund or Custodian.
7. Cooperation.
The Sub-Custodian shall cooperate with each Fund and Custodian and their
respective independent public accountants in connection with annual and other
audits of the books and records of Custodian or the Fund.
8. Compensation of Sub-Custodian.
The Sub-Custodian shall be entitled to reasonable compensation for its
services and expenses as Sub-Custodian, as agreed upon in writing from time to
time by and between the Sub-Custodian and the Custodian.
-5-
<PAGE>
9. Effective Period, Termination and Amendment.
This Agreement 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 thirty (30) days after the date of such delivery or mailing; provided,
however, that the Agreement shall not be amended or terminated in contravention
of any applicable federa1 or state regulations, or any provision of the
custodial agreements entered into between the Custodian and the separate Funds,
and further, provided that the Custodian any immediately terminate this
Agreement in the event of the appointment of a conservator or receiver for the
Sub-Custodian by the Federal Deposit Insurance Corporation or upon the happening
of a like event at the direction of an appropriate regulatory agency or court of
competent jurisdiction.
Upon termination of this Agreement, the Sub-Custodian shall promptly
deliver to the Custodian in person or by registered mail all property than held
by the Sub-Custodian under this Agreement.
10. Interpretive and Additional Provisions.
In connection w1th the operation of this Agreement, the Sub-Custodian and
the Custodian may from time to time agree in writing on such provisions
interpretive of or in addition to the provisions of this Agreement as may in
their joint opinion be
-6-
<PAGE>
consistent with the general tenor of this Agreement, which 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
custodian agreements entered into between the Custodian and the separate Funds.
No interpretive or additional provisions made as provided in the preceding
sentence shall be deemed to be an amendment of this Agreement.
11. New York Law to Apply.
This Agreement shall be construed and the provisions thereof interpreted
under and in accordance with the laws of the State of New York.
12.Communications Received by the Sub-Custodian.
The Sub-Custodian shall promptly transmit to the Custodian all
communications it receives concerning the securities it holds under this
Agreement and shall furnish statements of account in such manner and frequency
as the Sub-Custodian and the Custodian shall agree.
All communications required or permitted to be given under this Agreement
shall be in writing (including telex or telegraph) unless expressly provided
otherwise, and addressed as follows:
(a) If to the Sub-Custodian: Irving Trust Company
One Wall Street
New York, New York 10015
Attn: Corporate Trust Dept.
-7-
<PAGE>
(b) If to the Custodian: State Street Bank & Trust Company
Mutual Fund Services
P.O. Box 1713
Boston, MA 02105
Attention:
13. Acknowledgement and Consent to Relevant Master Custody Agreement.
The Custodian acknowledges that each of the entities named on Exhibit B
hereto (as such Exhibit may be amended from time to time by notice from the
Sub-Custodian to the Custodian) has been appointed remarketing agent (each a
Remarketing Agent) for certain series of securities held in custody pursuant to
this Agreement and that such Remarketing Agent and Irving Trust Company, as
custodian, (the "Master Custodian") have entered into a Master Custody Agreement
identified in such Exhibit as such Master Custody Agreement may be amended or
supplemented from time to time (each, a "Relevant Master Custody Agreement") for
the benefit of the owners of such series of securities held in custody pursuant
to this Agreement to promote the transfer of such series of securities
remarketed by such Remarketing Agent through a book-entry system maintained by
the Master Custodian. The Sub-Custodian will provide, upon request of the
Custodian, copies of each Relevant Master Custody Agreement for each series of
securities held in custody hereunder. The Custodian consents in all respects to
be bound by the terms thereof and to the extent that there is a conflict between
the terms of the Relevant Master Custody Agreement and this Agreement, the terms
of this Agreement shall govern:
-8-
<PAGE>
IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
executed this 30th day of November, 1987.
ATTEST: IRVING TRUST COMPANY
/s/ [Illegible] BY: /s/ [Illegible]
- -------------------- -----------------------------
[Illegible] Title: [Illegible]
ATTEST: STATE STREET BANK AND TRUST COMPANY
/s/ [Illegible] By: /s/ [Illegible]
- -------------------- ------------------------------
Assistant Secretary Vice President
-9-
<PAGE>
Amendment and Assumption Agreement
Reference is made to that certain Subcustodian Agreement between Irving
Trust Company and State Street Bank and Trust Company dated November 20, 1987
(the "Subcustodian Agreement").
Whereas, Irving Trust Company became acquired by the Bank of New York on
or about October 10, 1989; and
Whereas, State Street Bank and Trust Company ("State Street") and Bank of
Now York desire to maintain the terms and conditions of the business
relationship set forth in the Subcustodian Agreement as amended hereby.
Now, therefore, the parties agree as follows:
1. Bank of New York agrees to assume the rights, duties, responsibilities
and liabilities of the Subcustodian pursuant to the Subcustodian Agreement.
2. Any reference to "Irving Trust Company" or to the "Subcustodian" in the
Subcustodian Agreement shall be deemed to refer to the Bank of New York. For
purposes of Paragraph 12 of the Subcustodian Agreement, the proper address of
the Subcustodian shall be as follows:
Bank of New York
101 Barclay Street
New York, New York 10286
Attn: Sarah Zuckerman
3. All other terms of the Subcustodian Agreement are ratified and
reaffirmed hereby.
IN WITNESS WHEREOF, each of the parties has caused this agreement to be
executed this 6th day of February, 1990 with an effective date of October 10,
1989.
Attest: Bank of New York
/s/ [Illegible] By: /s/ [Illegible]
- -------------------- ----------------------
Title: W.T. CUNNINGHAM
Attest: State Street Bank and
Trust Company
/s/ [Illegible] By: /s/ [Illegible]
- -------------------- ----------------------
Title:
<PAGE>
EXHIBIT A
to the SUBCUSTODIAN AGREEMENT
with
BANK OF NEW YORK
Wire instructions containing Account Location, Name and Fund Number for
receipt of funds pursuant to Section 2 of this Agreement are as follows:
ABA Routing Number: 0110-000-28
STATE ST BOS/ (insert appropriate fund name and number identified
below)
Name of Fund Fund Number
- ------------ -----------
Scudder Fund, Inc.
Scudder Managed Tax-Free Fund 4506
Scudder Institutional Fund, Inc.
Scudder Institutional Tax Free Portfolio 4510
<PAGE>
[THE BANK OF NEW YORK LETTERHEAD]
Please be advised that effective October 6, 1989 Irving Trust Company and The
Bank of New York merged.
The surviving company will be named The Bank of New York.
By:
The Bank of Now York
DATED: October 10, 1989
Exhibit 14(a)
A GUIDE TO
SCUDDER FLEXI-PLAN
================================================================================
>General Information
>Questions and Answers
>Plan Agreement
- -------------------------=======================================================
Scudder Flexi-Plan is a tax-qualified
retirement plan consisting of a profit
sharing plan and a money purchase
pension plan.
Flexi-Plan is for self-employed
individuals (sole proprietors or
partnerships) and corporations.
It is a significant improvement on
Keoghs.
SCUDDER
SERVING INVESTORS SINCE 1919
- -------------------------=======================================================
<PAGE>
- ------------
INTRODUCTION
============
Scudder Flexi-Plan is a tax-qualified retirement program designed to meet the
needs of self-employed individuals, sole proprietors, partnerships and
corporations. If you're self-employed, it's an important advancement in Keogh
plans, allowing you to reduce your current tax bill while providing for the
future of everyone who participates in your plan.
Here are some of the important advantages offered by Scudder-Flexi-Plan:
o Significantly enhanced benefits for the self-employed. Flexi-Plan is part of a
new generation of Keogh plans offering self-employed individuals the same
benefits previously available only through corporations, including higher
tax-deductible contribution limits.
o Two plans to choose from. Our Flexi-Plan encompasses a profit sharing plan and
a money purchase pension plan: These plans can be used together to maximize your
flexibility and your tax-deductible contributions.
o The Scudder funds. Flexi-Plan investments are made in the Scudder family of
mutual funds. With the Scudder funds you can design an investment strategy to
suit your objectives, now and in the future. Invest for growth, income,
stability, or any combination. You get a full range of investment choices, with
the flexibility to exchange among the funds with a simple, toll-free call. And
because all Scudder funds are no load, 100% of your investment can go to work
for your retirement.
o The Scudder distinction. Scudder is one of the nation's largest and most
experienced investment counsel firms. We manage billions of dollars for astute
investors around the world. We pioneered the first no-load mutual fund in 1928,
and we have over 30 years of experience and commitment to retirement planning.
- --------------------------------------------------------------------------------
A Scudder Retirement Plan Specialist can answer any questions you have about
Flexi-Plan and help you complete our enrollment forms. Just call 1-800-323-6105.
- --------------------------------------------------------------------------------
<PAGE>
- ----------------------
HOW YOU BENEFIT FROM A
SCUDDER FLEXI-PLAN
======================
- --------------------------------------------------------------------------------
An immediate
tax break
Your contributions are tax-deductible. This can significantly reduce your tax
bill. If you're in the 28% tax bracket, a $12,000 contribution to a Flexi-Plan
will save you $3,360 that you would otherwise pay in current taxes.
- --------------------------------------------------------------------------------
Tax-deferred
compounding
Your contributions can grow free from state and federal taxes until
withdrawn--usually at retirement. This means all of your earnings are reinvested
tax-deferred, so they in turn earn more for you. Tax-deferred compounding is one
of the keys to real growth.
- --------------------------------------------------------------------------------
Favorable tax
treatment for
distributions
A lump sum distribution from your Flexi-Plan may be eligible for special tax
treatment called "5-year forward averaging." By taxing your distribution as if
it were your only income, and as if you received 1/5 of it each year for 5
years, 5-year forward averaging can significantly reduce your tax bill. For
Flexi-Plan investors it's an important advantage which is not available with
IRAs and SEPs.
THE PRINTED DOCUMENT CONTAINS A MOUNTAIN CHART HERE
MOUNTAIN CHART TITLE:
The Advantages of Tax Deferred Investing
MOUNTAIN CHART DATA:
This chart illustrates the advantage of deferring taxes while saving for your
retirement. If you invest $12,000 in your plan each year for 25 years, and earn
an 8% return on your investment each year, then at the end of this period you'll
have $947,453 in your account. If you invest the same amount each year in a
taxable account, and you're in the 28% tax bracket, paying taxes on your
investment income directly from this account, you'll have only $484,712 at the
end of the same 25 years. Of course, your actual return and tax bracket will
vary, and retirement plan balances become taxable at distribution. Your results
will differ from those in this example.
<PAGE>
- -------------------------
IMPORTANT FEATURES OF THE
SCUDDER FLEXI-PLAN
=========================
- --------------------------------------------------------------------------------
A wide range
of no load
investments
Scudder offers a family of commission-free mutual funds including money market
funds, income funds and growth funds. You can tailor your Flexi-Plan investments
to meet your needs by selecting one or more funds with an objective similar to
your own. The blue booklet, "How to select the right Scudder funds for you,"
will help you make the right choice.
- --------------------------------------------------------------------------------
Complete
flexibility
With Scudder, you always have the freedom to exchange among our funds as your
needs or market conditions change. All it takes is a simple toll-free call.
- --------------------------------------------------------------------------------
No fees or
charges
There's no set-up fee for Scudder Flexi-Plan, no annual maintenance fee, and no
fee if you should close your account. And all of the Scudder funds are no-load
so every dollar you invest goes to work for your future. Complete this to any
other retirement programs you might consider.
- --------------------------------------------------------------------------------
Friendly,
professional
service
As a Flexi-Plan investor, you'll receive regular fund reports and a quarterly
newsletter covering topics of interest and concern to investors. And you'll have
toll-free access to experienced Service Representatives who are ready to assist
you with instant updates on your account and speedy answers to your questions.
- --------------------------------------------------------------------------------
Convenient
recordkeeping
We will send you and your employees detailed account statements, and State
Street Bank, as the trustee for your Flexi-Plan, will send you the information
you or your accountant will need to file 5500 forms.
If yours is a larger plan, ask about alternative arrangements, including more
complete plan administration. You also have the option of naming trustees other
than State Street. Call our Retirement Plan Specialists for details.
- --------------------------------------------------------------------------------
Retirement Plan
Specialists
If you have any questions about Scudder Flexi-Plan, you can call our Retirement
Plan Specialists toll-free at 1-800-323-6105. They can explain how to calculate
the right contribution and assist you in completing our enrollment forms. And
our Service Representatives are always available to help you match a fund to
your objectives. Just call 1-800-225-2470.
<PAGE>
- ---------------------
QUESTIONS AND ANSWERS
=====================
- --------------------------------------------------------------------------------
Flexi-Plan
Q. What is Scudder
Flexi-Plan?
A. Flexi-Plan is a complete retirement program consisting of a profit sharing
plan and a money purchase pension plan. They can be used separately or together.
- --------------------------------------------------------------------------------
Q. Who is eligible for the
Scudder Flexi-Plan?
A. Self-employed individuals (including sole proprietors and partnerships) and
corporations (including Subchapter corporations) are eligible, so you're
eligible if you are any of the following:
o a member of a corporate Board of Directors;
o an owner of a small business;
o a freelancer providing services for a fee;
o a person with self-employment income from a part-time job--even if you
are also employed by a company with a qualified retirement plan.
Q. Can I start a Flexi-Plan
if I already have a Keogh or other
qualified retirement plan?
A. You can, so long as your total contributions to all of your retirement
plans do not exceed the maximum allowed by law. (IRA contributions are not
counted towards this limit.)
Q. Can I have a Flexi-Plan
and an IRA?
A. Yes, anyone covered by a Flexi-Plan is also entitled to make a
tax-deductible IRA contribution of up to $2,000 for the 1986 tax year.
For 1987, you'll still be able to invest as much as $2,000 in an IRA, but if
you're covered by a Flexi-Pan and your adjusted gross income exceeds $40,000
(for joint filers) or $25,000 (for single filers) part or all of your IRA
contribution will be nondeductible.
- --------------------------------------------------------------------------------
Q. What fees are involved?
A. There are no fees at all for either you or your employees. You pay no sales
charge when you buy or sell fund shares. There are no separate charges for
opening, maintaining or closing an account.
Q. What is the minimum
contribution necessary to start a
Flexi-Plan?
A. If you are the only person participating in your plan, then your minimum
contribution to open either the profit sharing or pension plan alone is just
$500. You can invest in more than one fund as long as you place at least $500 in
each fund. If you adopt the second plan, your minimum contribution for the
second plan is $300 per fund.
If your Flexi-Plan covers more than one person, then the minimum initial
contribution to either the profit sharing or pension plan alone equals $300
multiplied by your number of participants. Your contribution can be allocated
among your participants in any amounts.
For example, if your plan covers three people your initial contribution should
be at least $1500 (3 x $500). You might contribute $700 for participant A, $500
for participant B, and $300 for participant C. If you adopt the second plan,
your minimum initial investment in the second plan equals $300 multiplied by
your number of participants.
Once you establish a plan, your contributions to existing accounts may be
[ILLEGIBLE]
<PAGE>
- --------------------------------------------------------------------------------
================================================================================
- --------------------------------------------------------------------------------
Q. When should I start my
Flexi-Plan?
A. You must establish your plan by the end of your fiscal year to obtain a tax
deduction for that year. If you are a calendar year taxpayer (a self-employed
professional, for instance, whose taxes are due on April 15th) then you have
until December 31st to start a plan the current year.
Q. What is the deadline for
making contributions?
A. You have until the day your tax return is due (inducting any extensions) to
make your full contributions. Of course, the sooner you make your contributions
the sooner your retirement dollars begin compounding tax-deferred, so it pays to
start as early as possible in each new year.
Q. How much can I contrib-
ute to the Flexi-pension and
profit sharing plans together?
A. If you are incorporated, you can contribute as much as 25% of earned
income--up to $30,000 for each person covered by your plan.
If you are self-employed, the same limits apply, but earned income is defined
differently for you. Your earned income equals your net profits less retirement
plan contributions made on your behalf. The result is that 25% of your earned
income will equal 20% of your net profits. If you are a sole proprietor, your
net profits will appear on your Schedule C.
Your employees are still eligible to receive a contribution of up to 25% of
their wages.
Example: Assume you are self-employed, have net profits of $100,000 and no
employees. You'd like to contribute the maximum allowable.
You can contribute $20,000. This would be 20% of your net profits (20% x
$100,000) which is the same as 25% of your earned income [25% x
($100,000-$20,000)]. The difference between earned income and net profits is the
retirement plan contribution.
The specific contribution limits for each plan are explained later.
Q. What are the advantages
of using Flexi-Plan's profit shar-
ing plan?
A. The profit sharing plan provides you with the greatest flexibility. You can
change the percentage of compensation you contribute each year. You can also
skip a year and make no contribution, if you like.
You can contribute as much as 15% of earned income (again, up to $30,000 per
participant) to a profit sharing plan. If you don't intend to contribute any
more than 15%, then the profit sharing plan is your best option. If you'd like
to contribute more than 15%, then you should consider the money purchase pension
plan in conjunction with the profit sharing plan, or the pension plan alone.
Q. What are the advantages
of using Flexi-Plan's money
purchase pension plan?
A. The pension plan allows you to contribute the maximum amount. You can
contribute as much as 25% of compensation, up to $30,000 for each participant,
to a pension account. The pension plan, however, limits your flexibility. You
must contribute a fixed percentage of each participant's compensation to the
pension plan each year--even if you have no earnings or profits. You cannot
change the percentage you contribute for any year unless you amend your plan.
Q. If I'm self-employed, am I
required to contribute to the
money purchase pension plan for
the year if I have no earnings?
A. No, you are not required to make any contributions for yourself, since
contributions are calculated as a fixed percentage of earnings. However, if you
have employees you may need to contribute for them.
<PAGE>
- --------------------------------------------------------------------------------
================================================================================
- --------------------------------------------------------------------------------
Q. Should I adopt both the
profit sharing plan and the
pension plan?
A. If you're interested in contributing more than 15% you can adopt the profit
sharing plan and the pension plan together. This will provide you with the
maximum tax-break plus the flexibility to change the percentage of compensation
you contribute each year--by as much as 15% by altering your contributions to
the profit sharing plan.
Here's how you would divide your contributions if you want to contribute the
full 25%:
o To insure maximum flexibility, you would contribute 15% to the profit
sharing plan.
o To bring your contributions to 25%, you would contribute an additional
10% to the pension plan.
Remember, with the pension plan you would be committed to contributing a fixed
10% each year, but you could vary the level of your contributions to the profit
sharing plan from 0% to 15%.
Q. How much can I contrib-
ute to each plan if I'm self-
employed?
A. You'll recall that self-employed people can make contributions of up to 25%
of earned income, which equals 20% of net profits.
If you're contributing 15% to the profit sharing plan alone you would multiply
your net profits by 13.043%. The result will equal 15% of your earned income.
If you're adopting both plans and contributing the maximum, 13.043% for the
profit sharing plan does not apply, because you must consider both plans
together. As a self-employed individual you would contribute 12% to the profit
sharing plan and 8% to the pension plan. These contributions are based on net
profits.
Contributions for any employees are based on each individual's compensation as
shown on their W-2 forms.
Calculating Your Contribution Limits
(multiply this percentage by net profits if you are self-employed)
total
maximum profit pension contribution
deduction for sharing plan plan limit
- --------------------------------------------------------------------------------
Adopting only Self-employed 13.043% -- 13.043%
profit sharing Employees 15 -- 15
plan
- --------------------------------------------------------------------------------
Adopting only Self-employed -- 20 20
pension plan Employees -- 25 25
- --------------------------------------------------------------------------------
Adopting Self-employed 12 8 20
both plans Employees 15 10 25
- --------------------------------------------------------------------------------
<PAGE>
- --------------------------------------------------------------------------------
================================================================================
- --------------------------------------------------------------------------------
Q. Can I make voluntary
contributions to Flexi-Plan?
A. Yes, if you choose to, you and your plan's participants can each make
nondeductible voluntary contributions totaling 10% of your cumulative wages
during the time you or they are covered by the plan. This is above and beyond
the regular contributions you make as the employer.
If you're self-employed, your nondeductible voluntary contributions can
be up to 10% of net profits after your deductible retirement plan contributions.
In a year when you make the maximum tax-deductible contribution, full voluntary
contributions may not be made.
Q. What are the benefits of
making voluntary contributions?
A. All the earnings on these contributions are tax-deferred until withdrawn.
They allow you to accumulate even greater retirement savings.
Q. Is there a deadline for
making voluntary contributions?
A. No, voluntary contributions can be made at any time.
Q. Can I place a distribution
from another qualified retirement
plan in my Flexi-Plan account?
A. Yes, you can roll over lump sum distributions from other qualified
retirement plans. This allows you to continue deferring taxes and retain any
right you have to use special forward averaging on subsequent lump sum
distributions.
(Note: Generally, if you owned more than 5% of a business, a distribution from a
plan sponsored by that business may not be rolled over to another qualified
plan.)
Q. Can I transfer an existing
corporate retirement plan or
Keogh to Scudder?
A. Yes, and we'll do all the paperwork. Simply use the Transfer Form included
in this kit. There are no tax penalties involved.
- --------------------------------------------------------------------------------
Q. When can distributions
begin?
A. Generally, a participant in Flexi-Plan can start distributions either at
retirement or at normal retirement age, whichever is later. Your plan
administrator can, in many cases, approve earlier distributions. However,
stating in 1987, distributions before age 59-1/2 may be subject to a 10% penalty
tax unless rolled over or distributed in a certain manner. In addition,
owners of more than 5% of the business:
o must begin distributions by April 1st of the year following the year
they turn age 70-1/2, even if they continue to work and to make contributions.
other plan participants:
o may receive distributions when they terminate employment, or when the
plan terminates.
o prior to 1989, need not begin distributions until retirement, even if
over age 70-1/2.
Voluntary contributions may be withdrawn at any time.
Q. How can I take out my
money?
A. There are three ways to withdraw your money, depending on your plan(s) and
your particular situation:
<PAGE>
- --------------------------------------------------------------------------------
================================================================================
- --------------------------------------------------------------------------------
1. A lump sum payment allows you to withdraw your entire investment at once.
2. Periodic installments allow you to receive your money over a period of time.
3. Annuity payments ensure that you receive payments as long as you or your
spouse live.
Please review the Plan Document carefully to decide which options are available
for your situation.
Q. How are Flexi-Plan distri-
butions taxed?
A. If you take periodic distributions from your account, they will be taxed as
ordinary income.
If you ask to receive a lump sum, then your distribution may be eligible for
special forward averaging, a tax treatment which can significantly reduce your
tax bill. Lump sum distributions can also be placed in an IRA rollover, where
they can continue to tax-deferred.
Q. How does the Tax Reform
Act of 1986 change the rules for
Flexi-Plan investors?
A. This law makes several changes to the rules governing Keoughs, pensions,
and profit sharing plans. You should note that the major benefits of investing
in a Flexi-Plan--a large annual tax-deduction and tax-deferred compounding of
investment returns--remain intact, and more important than ever.
New rules for the 1987 tax year
o Nondeductible voluntary contributions will count toward the 25% or
$30,000 ceiling on annual contributions starting with the 1987 tax year.
o Withdrawals made before age 59-1/2 will generally be subject to a 10%
IRS penalty, unless rolled over to another plan or distributed in a certain
manner.
o Plan participants whose adjusted gross income exceeds $50,000 (for
joint filers) or $35,000 (for single filers) will be able to make only
nondeductible IRA contributions.
o Lump sum distributions will be eligible for five-year forward averaging
(formerly 10-year) under restricted conditions. 10-year averaging may apply
for individuals who reached age 50 before 1/1/86.
New rules effective with the 1989 tax year
o Contributions can be based on only the first $200,000 of compensation
for any one person, even if the retirement plan is not top heavy. (A
self-employed person can base contributions on as much as $230,000 if making a
$30,000 contribution.)
o Employees cannot be required to complete more than two years of service
before becoming eligible to participate in a retirement plan.
o Vesting schedule will be tightened resulting in more rapid vesting for
plan participants.
o All participants will be required to begin distributions by April 1 of
the year following the year they turn 70-1/2, even if they continue to work
and receive contributions at the same time.
o There will be a 50% IRS penalty on distributions which were required
but not received by plan participants over age 70-1/2.
A more detailed explanation of the tax reform changes, titled "Scudder
Flexi-Plan
[ILLEGIBLE]
<PAGE>
- --------------------------------------------------------------------------------
================================================================================
- --------------------------------------------------------------------------------
For Those Plans Covering Employees
Q. If I have employees,
should they be covered by this
Plan?
A. Yes. You must include full-time employees and certain part-time employees,
if they meet specific conditions. You can require your employees to complete a
waiting period before becoming eligible to participate, or you can offer them
immediate participation. Prior to 1989 the most stringent eligibility
requirements allowed are 3 years of service and 21 years of age.
Q. How much should I con-
tribute for each of my employees?
A. Contributions for any employees are based on each individual's compensation
as shown on their W-2 forms. You contribute the same percentage of compensation
for each employee that you contribute for yourself. For example, you might
contribute 5% of compensation for each eligible participant. Maximum
contribution limits for employees are shown in the chart on page 7.
Q. Does Flexi-Plan allow for
Social Security integration?
A. Yes. As an employer you already contribute toward retirement for each of
your employees by making payments to Social Security. Your Social Security
contributions are based on each employee's wages; however, wages in excess of
the Social Security wage base are not taken into account.
Integration allows you to allocate a portion of your total retirement plan
contribution to employees whose wages exceed the Social Security wage base (or a
lower amount which you can select). In effect, integration allows you to
consider your Social Security contributions together with your retirement plan
contributions for the purpose of allocation. (A top heavy plan will still have
to make minimum contributions.)
Q. How are contributions
vested?
A. You can select full and immediate vesting, 6-year graduated vesting, or
something in between. (If you choose a waiting period of more than one year for
eligibility, vesting must be full and immediate.)
Q. Can participants make
their own investment decisions?
A. Each participant's account will be self-directed within the Scudder family
of funds, unless you decide to have your plan administrator make the investment
decisions. Generally, the employer is the plan administrator.
Q. Does Flexi-Plan permit
loans?
A. You have the option of allowing participants to borrow from your plan.
Loans must be available to all plan participants on an equal basis.
Plan loans can be an important source of funds for participants in times of
hardship. A reasonable rate of interest is required on plan loans.
- --------------------------------------------------------------------------------
Q. What is a "top heavy"
plan?
A. A top heavy plan is one in which more than 60% of the benefits go to key
employees. This is frequently the case in small businesses where there are few
employees.
<PAGE>
- --------------------------------------------------------------------------------
================================================================================
- --------------------------------------------------------------------------------
Q. Who are key employees?
A. A key employee is an employee who at any time during the plan years or any
of the preceding four plan years, is one of the following:
o an individual owning more than 5% of a business;
o an individual owning more than 1% of a business and earning more
than $150,000;
o an officer of a business earning more than $45,000;
o one of the 10 employees earning more than $30,000 and owning the
largest interests in the employer.
Q. Are there special require-
ments for top heavy plans?
A. Top heavy plans must allocate a contribution of at least 3% to non-key
employees (or the percentage equal to the highest contribution rate used for key
employees). Top heavy plans must also provide that vesting for eligible
participants reach 100% after 6 years. This rule is incorporated in the
Flexi-Plan.
Q. Does the Flexi-Plan
satisfy TEFRA's top heavy rules?
A. Yes, the Flexi-Plan automatically includes provisions that satisfy these
rules regarding top heavy plans.
- --------------------------------------------------------------------------------
Q. What kind of reports will I
need to file?
A. You should file a Summary Plan Description with the U.S. Department of
Labor within 120 days of starting your Flexi-Plan. We'll send one to you with
instructions as soon as you sign up.
You may also have to file the IRS Form 5500 Series Report for your plan each
year. It's due by the final day of the seventh month following the end of your
plan year. This will be July 31 for those plans on a calendar year. State Street
Bank and Trust Co., if trustee, will send you the information you need to
complete the form.
Q. What kind of notification
should I give to my employees?
A. You must post a Notice to Interested Parties. You should also make a copy
of the Summary Plan Description available to each of your participants. The
Notice to Interested Parties is included in the enrollment book.
Q. Will I need to apply to the
IRS for a determination letter?
A. If you use the Adoption Agreements enclosed in this kit (which appoint
State Street Bank as Trustee), you can rely on Scudder's IRS opinion letter,
unless you maintain or have maintained at any time another qualified plan (other
than a plan amended into a Flexi-Plan appointing State Street Bank as trustee or
another Flexi-Plan appointing State Street Bank as trustee). If you have
maintained another plan, you'll have to file for a determination letter from the
IRS for assurance that both your plans will be qualified.
- --------------------------------------------------------------------------------
How to Start Your Flexi-Plan
Q. What should I do to start
a Flexi-Plan?
A. Everything you need is right in this package. After reading all of the
enclosed material, including the prospectus for the fund or funds you've
selected, turn to the booklet of enrollment forms and follow the instructions
there. (If you need a new prospectus, please give us a call.)
<PAGE>
SCUDDER
PROTOTYPE PLAN
Basic Plan Document 01
SECTION 1.
INTRODUCTION
The Employer has established this Plan (the "Plan") consisting of the
Adoption Agreement and the following provisions (the "Prototype Plan") for the
exclusive benefit of its Employees and their Beneficiaries.
SECTION 2.
DEFINITIONS
Where the following words and phrases appear in this Plan, they shall have
the respective meanings set forth below, unless their context clearly indicates
a contrary meaning. The singular herein shall include the plural, and vice
versa, and the masculine gender shall include the feminine gender, and vice
versa, where the context requires.
2.01 "Account" shall mean the Trust assets held by the Trustee for the
benefit of a Participant, which shall be the sum of the Participant's Employer
Contribution Account, Nondeductible Voluntary Contribution Account, Deductible
Voluntary Contribution Account, Rollover Account, and any transfer account
established pursuant to Section 4.04 hereof with respect to funds transferred on
the Participant's behalf.
2.02 "Act" shall mean the Employee Retirement Income Security Act of 1974,
as amended.
2.03 "Administrator" shall mean the person or persons specified in Section
12.01 hereof.
2.04 "Adoption Agreement" shall mean the agreement by which the Employer
has most recently adopted or amended the Plan.
2.05 "Beneficiary" shall mean any person or legal representative
effectively designated by the Participant as a person entitled to receive
benefits on or after the death of a Participant within the meaning of Code
Section 401(a)(9)(E) and any regulations promulgated thereunder by the Secretary
of the Treasury.
2.06 "Code" shall mean the Internal Revenue Code of 1954, as amended.
Reference to a section of the Code shall include any comparable section or
sections of future legislation that amends, supplements or supersedes such
section.
2.07 "Compensation" shall mean the amount paid during the Plan Year by the
Employer to the Employee for services rendered while a Participant, as
reportable to the Federal Government for the purpose of withholding Federal
income taxes, but not including, so long as the Plan is not integrated with
Social Security, amounts attributable to any category specified in the Adoption
Agreement. If so specified in the Adoption Agreement, Compensation shall also
mean amounts paid to the Employee for services rendered for the entire Plan Year
in which an Employee became a Participant whether or not such an Employee was a
Participant for the entire Plan Year. In the case of a Self-Employed Individual,
the above determination of Compensation shall be made on the basis of the Self-
Employed Individual's Earned Income. Notwithstanding the previous sentence, for
the purposes of the limitations imposed by Section 401(a)(i)(C)(II) below,
Compensation of a Self-Employed Individual shall be determined in accordance
with the rules provided in Code Section 404(a)(8)(D).
2.08 "Current Accumulated Earnings and Profits" of an Employer other than a
sole-proprietorship or partnership shall mean the Employer's current or
accumulated earnings and profits, as determined on the basis of the Employer's
books of account in accordance with generally accepted accounting practices,
without any deductions for Employer Contributions under the Plan (or any other
qualified plan) for the current Year or for income taxes for the current Year,
and without regard to the Employer's election to be taxed as a small business
corporation, if it has so elected. If the Employer is a sole-proprietorship or
partnership, "Current or Accumulated Earnings and Profits" shall mean the net
income of such Employer before deduction for income taxes and contributions made
hereunder.
2.09 "Deductible Voluntary Contribution Account" shall mean the separate
account maintained pursuant to Section 6.03(c) hereof for the Deductible
Voluntary Contributions made by the Participant and the income, expenses, gains
and losses attributable thereto.
2.10 "Deductible Voluntary Contributions" shall mean the contributions made
by Participants in accordance with Section 4.02 hereof, which respective
contributing Participants designate as "Deductible Voluntary Contributions" at
the time of contribution, and which comply with the requirements of Code Section
219.
2.11 "Designated Investment Company" shall mean a regulated investment
company for which Scudder, Stevens & Clark, its successor or any of its
affiliates, acts as investment adviser and which is designed by Scudder Fund
Distributors, Inc. or its successors, as eligible for investment under the Plan.
2.12 "Designation of Beneficiary" or "Designation" shall mean the document
executed by a Participant under Section 15.
2.13 "Disability" shall mean the inability to engage in any substantial
gainful activity by reason of any medically determinable physical or mental
impairment that can be expect to result in death or last for a continuous period
of 12 months or more, as certified by a licensed physician selected by the
Participant and approved by the Employer.
2.14 "Distributee" shall mean the Beneficiary or other person entitled to
receive the undistributed portion of the Participant's Account under Section 8
because of death or under Section 14 because of incompetency or inability to
ascertain or locate such individual.
2.15 "Distributor" shall mean Scudder Fund Distributors, Inc. or its
successor.
2.16 "Earned Income" shall mean the net earnings from self employment in
the trade or business with respect to which the Plan is established, for which
personal services of the Owner-Employee or Self-Employed Individual are a
material income-producing factor. Net earnings will be determined without regard
to items not included in gross income and the deductions allocable to such
items. Net earnings are reduced by contributions by the Employer to a qualified
plan, including this Plan, to the extent deductible under Code Section 404.
2.17 "Effective Date" shall mean the date specified by the Employer in the
Adoption Agreement.
2.18 "Election Period" shall mean the period which begins of the first day
of the Plan Year in which the Participant attains age 35 and which ends on the
date of the Participant's death. If a Participant separates from service prior
to the first day of the Plan Year in which he or she attains age 35 the Election
Period with respect to his or her vested Account balance (as of his or her date
of separation) shall begin on his or her date of separation.
2.19 "Employee" shall mean an individual who performs services in the
business of the Employer in any capacity (including any individual deemed to be
an employee of the Employer under Code Section 414(n)).
2.20 "Employer" shall mean the organization or other entity named as such
in the Adoption Agreement and any successor organization or entity which adopts
the Plan.
Any two or more organizations or entities which are members of (a) a
controlled group of corporations (as defined under Code Section 414(b)), (b) a
group of trades or businesses (whether or not incorporated) which are under
common control (as defined under Code Section 414(c)), or (c) an affiliated
service group (as defined under Code Section 414(m)), will be considered to be
the Employer for the purposes of the Plan, unless the Plan is adopted as a
nonstandardized plan, the adopting Employer makes a written election to the
contrary and such written election is attached to the Adoption Agreement. Any
such attached, written election shall become part of the Adoption Agreement.
2.21 "Employer Contribution Account" shall mean the separate account
maintained pursuant to Section 6.03(a) hereof for the Employer Contributions
allocated to a Participant and the income, expenses, gains and losses
attributable thereto.
2.22 "Employer Contributions" shall mean the contributions made by the
Employer in accordance with Section 4.01 hereof.
2.23 "Hour of Service" shall mean:
(a) Each hour for which an Employee is paid, or entitled to payment,
for the performance of duties for the Employer. These hours shall be credited to
the Employee for the computation period in which the duties are performed;
(b) Each hour for which an Employee is paid, or entitled to payment,
by the Employer on account of a period of time during which no duties are
performed (irrespective of whether the employment relationship has terminated)
due to vacation, holiday, illness, incapacity (including Disability), layoff,
jury duty, military duty or leave of absence. No more than 501 Hours of Service
shall be credited under this paragraph for any single continuous period (whether
or not such period occurs in a single computation period). Hours under this
subsection shall be calculated and credited pursuant to section 2530.200b-2 of
the Department of Labor Relations which are incorporated herein by reference;
(c) Solely for the purpose of determining whether a One-Year Break in
Service has occurred, each hour which normally would have been credited to an
Employee (or in any case in which such house cannot be determined, eight hours
per day of such absence) but for an absence from work during a Plan Year
beginning after December 31, 1984 because of such individual's pregnancy, birth
of a child of the individual, placement of an adopted child with the individual,
or caring for an adopted or a natural child following placement or birth. Hours
of Service under this paragraph shall be credited in the Plan Year in which the
absence begins if the individual would otherwise have suffered a One-Year Break
in Service, and in all other cases, in the immediately following Plan Year. No
more than 501 Hours of Service shall be credited under this paragraph by reason
of any one placement or pregnancy. Notwithstanding any implication of this
subsection (c) to the contrary, no credit shall be give under this subsection
(c), unless the Employee makes a timely, written filing with the Administrator
which establishes valid reasons for the absence and enumerates the days for
which there was such an absence;
(d) Each hour for which back pay, irrespective of mitigation of
damages, is either awarded or agreed to by the Employer. The same Hours of
Service shall not be credited both under subsection (a), (b) or (c), as the case
may be, and under this subsection (d). These hours shall be credited to the
Employee for the computation period or periods to which the award or agreement
pertains rather than the computation period in which the award, agreement or
payment is made.
Where the Employer maintains the plan of a predecessor employer, service
for such predecessor employer shall be treated as Service of the Employer. Where
the Employer does not maintain the plan of a predecessor employer, employment by
a predecessor employer, upon the written election of the Employer made in a
uniform and non-discriminatory manner, shall be treated as Service for the
Employer, provided that the Employer may only make such an election if he has
adopted this Plan as a nonstandardized plan.
If the Employer is a member of (a) a controlled group of corporations (as
defined under Code Section 414(b)), (b) a group of trades or businesses (whether
or not incorporated) which are under common control (as defined under Code
Section 414(c)), or (c) an affiliated service group (as defined under Code
Section 414(m)), all service of an Employee for any member of such a group shall
be treated as if it were Service for the Employer for purposes of this Section
2.23.
In addition, all service for any individual who is considered a leased
employee of the Employer under Code Section 414(n) shall be treated as if it
were Service for the Employer for purposes of this Section 2.23. However,
qualified plan contributions or benefits provided by the leasing organization
which are attributable to Services performed for the Employer shall be treated
as provided by the Employer. The provisions of this paragraph shall not apply to
any leased employee if such employee is covered by a money purchase pension plan
maintained by the leasing organization providing: (a) a nonintegrated employer
contribution rate of at least 7-12% of compensation, (b) immediate
participation, and (c) full and immediate vesting. For purposes of this Section
2.23, the term "leased employee" means any person who is not an Employee and
who, pursuant to an agreement
<PAGE>
between the recipient and any other person, has performed services for the
Employer (or for the Employer and related persons determined in accordance
with Code Section 414(n)(6)) on a substantially full-time basis for a
period of at least one year and such services are of a type historically
performed by employees in the business field of the Employer.
2.24 "Integration Level" for a Plan Year shall mean the lesser of the
Social Security Wage Base or the dollar amount specified in the Adoption
Agreement.
2.25 "Integration Rate" for a Plan Year shall mean the lesser of the OASDI
Rate (as in effect on the first day of the Plan Year) or the rate specified in
the Adoption Agreement.
2.26 "Loan Trustee" shall mean the Trustee or, if the Employer has
specified otherwise in the Adoption Agreement, the individual or individuals so
appointed to act as trustees solely for the purpose of administering the
provisions of Section 10 and holding the Trust assets to the extent that they
are invested in loans pursuant to such Section.
2.27 "Nondeductible Voluntary Contributions Account" shall mean the
separate account maintained pursuant to the Section 6.03(b) hereof for
Nondeductible Voluntary Contributions made by the Participant and the income,
expenses, gains and losses attributable thereto.
2.28 "Nondeductible Voluntary Contributions" shall mean all contributions
by Participants which are not Deductible Voluntary Contributions, Rollover
Contributions, or contributions of accumulated deductible employee contributions
made pursuant to Section 4.02(b)(vi) hereof.
2.29 "Normal Retirement Date" or "Normal Retirement Age" shall mean the
earlier of (a) the date selected by the Employer in the Adoption Agreement or,
(b) if the Employer enforces a mandatory retirement age, the first day of the
month in which the Participant reaches that age.
2.30 "OASDI Rate" for a Plan Year shall mean the tax rate applicable, on
the first day of the Plan Year, to employer contributions for old age,
survivors, and disability insurance under the Social Security Act.
2.31 "One-Year Break in Service" shall mean a 12-consecutive-month period
in which an Employee does not complete more than 500 Hours of Service unless the
number of Hours of Service specified in the Adoption Agreement for purposes of
determining a Year of Service is less than 501, in which case a
12-consecutive-month period in which an Employee has fewer than that number of
Hours of Service shall be a One-Year Break in Service. The computation period
over which One-Year Breaks in Service shall be measured shall be the same
computation period over which Years of Service are measured.
2.32 "Owner-Employee" shall mean an Employee who is a sole proprietor
adopting this Plan as the Employer, or who is a partner owning more than 10% of
either the capital or profits interest of a partnership adopting this Plan as
the Employer. Solely for the purposes of Section 10 hereof, Owner-Employee shall
also mean an Employee or officer who owns (or is considered as owning within the
meaning of Code Section 318(a)(1)) on any day during the Year, more than 5% of
the Employer if the Employer is an electing small business corporation.
2.33 "Participant" shall mean an Employee who is eligible to participate in
the Plan under Section 3 (other than, if this Plan is adopted as a
non-standardized plan, a Self-Employed Individual who elects not to be a
Participant in the Plan) and who has not, since becoming a Participant, died,
retired, otherwise terminated employment with the Employer or transferred from
an eligible class to a class of Employees ineligible to participate in the Plan.
2.34 "Plan" shall mean the Prototype Plan and Adoption Agreement.
2.35 "Plan Year" shall mean the fiscal year of the Employer or a different
12-consecutive-month period as specified in the Adoption Agreement.
2.36 "Prototype Plan" shall mean these Sections 1.24.
2.37 "Qualified Election" shall mean a valid waiver of a Qualified Joint
and Survivor Annuity or Qualified Preretirement Survivor Annuity, as the case
may be. To be valid, the waiver must be in writing and Participant's Spouse must
consent to it in writing. The Spouse's consent to the waiver must be witnessed
by a Plan representative or notary public and must be a limited consent to the
provision of a benefit or benefits to a specific alternate person or persons.
Notwithstanding the foregoing consent requirement, if the Participant
establishes to the satisfaction of a Plan representative that such written
consent may not be obtained because there is no Spouse or the Spouse cannot be
located, a waiver will nonetheless be deemed a Qualified Election. Any consent
necessary for a Qualified Election will be valid only with respect to the Spouse
who signs the consent, or in the event of a deemed Qualified Election, the
Spouse whose consent could not be obtained or who could not be located.
Additionally, a revocation of a prior waiver may be made by a Participant
without the consent of the Spouse at any time before the commencement of
distributions or benefits. The number of revocations shall be unlimited, but
each such revocation shall once again make the Qualified Joint and Survivor
Annuity or Qualified Preretirement Survivor Annuity applicable, as the case may
be, and the spouse must consent to any subsequent waiver in accordance with the
requirements of this Section 2.37.
2.38 "Qualified Joint and Survivor Annuity" shall mean, in the case of a
married Participant, an annuity which can be purchased with the Participant's
vested Account balance for the life of the Participant with a survivor annuity
for the life of the Spouse equal to 50% of the amount of the annuity which is
payable during the joint lives of the participant and the Spouse. In the case of
an unmarried Participant, Qualified Joint and Survivor Annuity shall mean an
annuity which can be purchased with a Participant's vested Account balance for
the life of the Participant.
2.39 "Rollover Account" shall mean the separate account maintained pursuant
to Section 6.03(d) hereof for any Rollover Contributions (as described in
Section 4.03 hereof) made by the Participant and the income, expenses, gains and
losses attributable thereto.
2.40 "Rollover Contributions" shall mean contributions made to the Trust by
Participants in accordance with Section 4.03 hereof.
2.41 "Self-Employed Individual" shall mean an Employee who has Earned
Income for the taxable year from the trade or business for which the Plan is
established, or an individual who would have had Earned Income but for the fact
that the trade or business had no Current or Accumulated Earnings and Profits
for the taxable year.
2.42 "Service" shall mean employment by the Employer and, if the Employer
is maintaining the plan of a predecessor employer, or if the Employer is not
maintaining the plan of a predecessor employer but has so elected in the manner
described in Section 2.23 above, employment by such predecessor employer.
2.43 "Social Security Wage Base" for a Plan Year means the maximum amount
of annual earnings which may be considered wages under Code Section 3121(a)(1)
as in effect on the first day of such Plan Year.
2.44 "Sponsor" shall mean any of the organizations (a) which have requested
a favorable opinion letter from the National Office of the Internal Revenue
Service for this Plan or (b) to which a favorable opinion letter for this Plan
has been issued by the National Office of the Internal Revenue Service.
2.45 "Spouse" shall mean the spouse or surviving spouse of the Participant,
provided that a former spouse will be treated as the spouse or surviving spouse
to the extent provided under a Qualified Domestic Relations Order (as described
in Section 16.02 hereinafter).
2.46 "Trust" shall mean the trust established under Section 11 of this Plan
for investment of Trust assets.
2.47 "Trust Fund" shall mean the contributions to the Trust and any assets
into which such contributions shall be invested or reinvested in accordance with
Sections 11.01 and 11.03 of this Plan.
2.48 "Trustee" shall mean the person or persons including any successor or
successors thereto, named in the Adoption Agreement to act as trustee of the
Trust and hold the Trust assets in accordance with Section 11 hereof.
2.49 "Valuation Date" shall mean the last day of each Plan Year.
2.50 "Vesting Years" shall be measured on the 12-consecutive-month period
specified in the Adoption Agreement. A Participant will have a Vesting Year
during such computation period only if the Participant completes the number of
Hours of Service selected in the Adoption Agreement for purposes of computing a
Year of Service. However, notwithstanding the preceding sentence, if the
Employer has so specified in the Adoption Agreement, a Participant who does not
receive credit for a Vesting Year under the preceding sentence will still have a
Vesting Year for each Plan Year for which the Participant shares in the
allocation of Employer contributions for the Plan Year. However, when
determining Vesting Years, unless the Employer has otherwise specified in the
Adoption Agreement, there shall be excluded: (a) if this Plan is a continuation
of an earlier plan which would have disregarded such service, Service before the
first Plan Year to which the Act is applicable; (b) Service after five
consecutive One-Year Breaks in Service (but this exclusion shall apply only for
the purpose of computing the vested percentage of Employer Contributions made
before such five-year period); (c) Service before a period of five One-Year
Breaks in Service, if the Participant has no vested interest in his Employer
Contribution Account at the time of such break and the number of consecutive
One-Year Breaks in Service equals or exceeds the number of Vesting Years
excluded by such break without counting Vesting Years excluded by an earlier
application of this provision; (d) Service before the first Plan Year in which
the Participant attained age 18; (e) Service before the Employer maintained this
Plan or a predecessor plan; and (f) Service before January 1, 1971, unless the
Participant has completed at least three Vesting Years after December 31, 1970.
For the purposes of subsection (a), service disregarded under a prior plan
includes service credits lost because of separation or failure to complete a
required period of service within a specified period of time; such lost service
credits may have resulted in the loss of prior vesting or benefit accruals, or
the denial of eligibility to participate.
2.51 "Year" shall mean the fiscal year of the Employer.
2.52 "Year of Service" shall mean a 12-consecutive-month period, beginning
on an Employee's initial date of employment or an anniversary thereof during
which the Employee completes the number of Hours of Service specified in the
Adoption Agreement. The initial date of employment is the first day on which the
Employee performs an Hour of Service.
SECTION 3.
ELIGIBILITY
3.01 Entry. Each Employee of the Employer, who on the Effective Date of
this Plan meets the conditions specified in the Adoption Agreement, shall become
eligible to participate in the Plan commending with Effective Date. Each other
Employee of the Employer, including future Employees, shall become eligible to
participate in the Plan when the eligibility requirements specified in the
Adoption Agreement are met. For the purposes of this Plan's eligibility
requirements, the exclusion concerning Employees who are covered by collective
bargaining agreements applies to individuals who are covered by a collective
bargaining contract between the Employer and Employee Representatives if
contract negotiations considered retirement benefits in good faith and unless
such contract specifically provides for participation in the Plan. For the
purposes of this Section 3.01, "Employee Representatives" shall mean the
representatives of an employee organization which engages in collective
bargaining negotiations with the Employer, provided that owners, officers and
executives of the Employer do not comprise more than 50% of the employee
organization's membership.
3.02 Interrupted Service. All Years of Service with the Employer are
counted towards eligibility except the following:
(a) If the Employer has specified in the Adoption Agreement that more
than one Year of Service is required before becoming a Participant, and if the
individual has a One-Year Break in Service before satisfying the Plan's
eligibility requirements. Service before such break will not be taken into
account.
(b) For Plan Years beginning before January 1, 1985, in the case of a
Participant who does not
<PAGE>
have any nonforfeitable right to his or her Employer Contributions, Years
of Service before a One-Year Break in Service will not be taken into
account in computing Years of Service for purposes of eligibility if the
number of consecutive One-Year Breaks in Service equals or exceeds the
aggregate number of such Years of Service before such break. Such
aggregate number of Years of Service before such break will not include any
Years of Service disregarded under this subsection (b) by reason of a prior
break in service.
(c) For Plan Years beginning after December 31, 1984, in the case of a
Participant who does not have any nonforfeitable right to his or her Employer
Contributions, Years of Service before a period of consecutive One-Year Breaks
in Service will not be taken into account in computing Years of Service for
purposes of eligibility, if the number of consecutive One-Year Breaks in Service
in such period equals or exceeds the greater of five or the Employee's aggregate
number of such Years of Service before such break. Such aggregate number of
Years of Service before such period will not include any Years of Service
disregarded under this subsection (c) by reason of a prior period of consecutive
One-Year Breaks in Service.
3.03 Reentry. If a former Participant either (a) had a nonforfeitable right
to all or a portion of his or her Employer Contribution Account at the time of
termination from Service or (b) did not have any nonforfeitable right to his or
her Employer Contribution Account but does not have Service prior to the break
in Service disregarded by operation of Section 3.02(b) or (e) hereof, such
former Participant shall become a Participant immediately upon return to the
employ of the Employer as a member of an eligible class of Employees.
3.04 Transfer to Eligible Class. In the event an Employee is not a member
of an eligible class of Employees becomes a member of an eligible class, such
Employee shall participate immediately if such Employee has satisfied the
minimum age and Service requirements and would have previously become a
Participant had he or she been a member of an eligible class through the period
of employ with the Employer.
3.05 Determination by Administrator. Eligibility shall be determined by the
Administrator and the Administrator shall notify each Employee upon his or her
admission as a Participant in the Plan.
SECTION 4.
CONTRIBUTIONS
4.01 Employer Contributions and Allocation
(a) Profit Sharing Plan. If the Employer has adopted this Plan as a
profit sharing plan, the following provisions shall apply:
(i) Contribution.
(A) Subject to Requirements of subparagraphs (B) and (C)
below, beginning in the Plan Year in which the Plan is adopted, and for each
Plan Year thereafter, the Employer will contribute the amount determined by it,
in its discretion, for the Plan Year in question.
(B) Subject to the requirements of subparagraph (C) below,
during any Plan Year in which the Employer has elected to provide Employer
thrift matching contributions in the Adoption Agreement, the Employer shall
contribute at least the aggregate amount specified in the Adoption Agreement.
(C) During a Plan Year, the aggregate Employer Contributions
made pursuant to this Section 4.01(a)(i) may not exceed the lesser of (I) the
Employer's Current or Accumulated Earnings and Profits for the Plan Year or (II)
15% (or such larger percentage as may be permitted by the Code as a current
deduction to the Employer with respect to any Plan Year) of the total
Compensation (disregarding any exclusion from Compensation specified by the
Employer in the Adoption Agreement) paid to, or accrued by the Employer for,
Participants for that Plan Year plus any unused credit carryovers from previous
Plan Years. For this purpose, a "credit carryover" is the amount by which
Employer Contributions for a previous Plan Year were less than 15% of the total
Compensation (disregarding any exclusion from Compensation specified by the
Employer in the Adoption Agreement) paid or accrued by the Employer to
Participants for such Plan Year, but such unused credit carryover shall in no
event permit the Employer Contributions for a Plan Year to exceed 25% (or such
larger percentage as may be permitted by the Code as a deduction to the
Employer) of the total Compensation (disregarding any exclusions from
Compensation specified by the Employer in the Adoption Agreement) paid to, or
accrued for, Participants by the Employer for the Plan Year in question.
(ii) Allocation Under Non-Integrated, Profit Sharing Plan. If the
Employer has adopted this Plan as a profit sharing plan under which allocations
shall be made on a non-integrated basis, Employer Contributions, plus any
forfeitures under Section 7.02, for a Plan Year shall be allocated according to
the provisions of this subsection (ii) as of the Valuation Date for such Plan
Year.
(A) Subject to the terms of subparagraph (B) below, unless
the Employer has specified otherwise in the Adoption Agreement, such amount
shall be allocated among the Employer Contribution Accounts of all Participants
and former Participants who were employed by the Employer during the Plan Year.
If the Employer has specified in the Adoption Agreement that a minimum number of
Hours of Service are necessary to share in the allocation of Employer
Contributions and forfeitures for a Plan Year in which the Plan is not Top
Heavy. Participants and former Participants, as the case may be, who fail to
complete the required number of Hours of Service during such a Plan Year shall
not share in the allocation. If the Employer has so specified in the Adoption
Agreement, Employer Contributions and forfeitures shall be allocated only among
otherwise entitled Participants who are employed by the Employer on such
Valuation Date. Employer Contributions and forfeitures shall be allocated to
Participants entitled to share in the allocation of Employer Contributions and
forfeitures for that Plan Year in proportion to their Compensation for such Plan
Year.
(B) Notwithstanding the provisions of subparagraph (A) above
but nonetheless subject to the provisions of Section 21.03 below, during any
Plan Year in which the Employer has elected to provide Employer thrift matching
contributions in the Adoption Agreement and the Plan is not a Top-Heavy Plan.
Employer Contributions and forfeitures shall be allocated in proportion to the
percentage of Participants' Nondeductible Voluntary Contributions as specified
in the Adoption Agreement.
(iii) Allocation Under Integrated, Profit Sharing Plan. If the
Employer has adopted this Plan as a profit sharing plan under which allocations
shall be made on an integrated basis. Employer Contributions, plus any
forfeitures under Section 7.02, for a Plan Year shall be allocated according to
the provisions of this subsection (iii) as of the Valuation Date for such Plan
Year. Unless the Employer has specified otherwise in the Adoption Agreement,
such amount shall be allocated among all Participants and former Participants
who were employed by the Employer during the Plan Year. If the Employer has
specified in the Adoption Agreement that a minimum number of Hours of Service
are necessary to share in the allocation of Employer Contributions and
forfeitures for a Plan Year in which the Plan is not Top Heavy, Participants and
former Participants, as the case may be, who fail to complete the required
number of Hours of Service during such a Plan Year shall not share in the
allocation. If the Employer has so specified in the Adoption Agreement, Employer
Contributions and forfeitures shall be allocated only among otherwise entitled
Participants who are employed by the Employer on such Valuation Date. Employer
Contributions and forfeitures shall be allocated to Participants entitled to
share in the allocation of Employer Contributions and forfeitures for that Plan
Year as follows:
(A) First, Employer Contributions and forfeitures will be
allocated to the Employer Contribution Account of each Participant entitled to
share in the allocation of such amounts in the ratio that each such
Participant's Compensation for the Plan Year in excess of the Integration Level
bears to the Compensation in excess of the Integration Level for all such
Participants, provided that the amount so credited to any such Participant's
Employer Contribution Account for the Plan Year shall not exceed the product of
the Integration Rate times the Participant's Compensation in excess of the
Integration Level.
(B) Next, any remaining Employer Contributions or
forfeitures will be allocated to the Employer Contribution Accounts of all
Participants entitled to share in the allocation of the Employer Contributions
for the Plan Year in the ratio that each such Participant's Compensation for the
Plan Year bears to all such Participants' Compensation for that Plan Year.
(b) Money Purchase Pension Plan. If the Employer has adopted this Plan
as a money purchase pension plan, the Employer will, beginning for the Plan Year
in which the Plan is adopted, and for each Plan Year thereafter, contribute, for
allocation to the Employer Contribution Account of each Participant entitled to
share in the allocation of Employer Contributions, the amount specified in the
Adoption Agreement reduced by any forfeitures arising during the preceding Plan
Year pursuant to Section 7.02 hereafter.
(i) Unless the Employer has specified otherwise in the Adoption
Agreement, the amount of the Employer Contribution shall be calculated on the
basis of the Compensation of all Participants and former Participants who were
employed by the Employer during the Plan Year. If the Employer has specified in
the Adoption Agreement that a minimum number of Hours of Service are necessary
to receive an Employer Contribution in a Plan Year in which the Plan is not Top
Heavy, Participants and former Participants, as the case may be, who fail to
complete the required number of Hours of Service during such a Plan Year shall
not be considered when calculating the amount of the Employer Contribution. If
the Employer has so specified in the Adoption Agreement, only Participants who
are employed by the Employer on such Valuation Date and who are otherwise
entitled to receive an allocation shall be considered when calculating the
amount of the Employer Contribution. Employer Contributions shall be allocated
to the Employer Contribution Accounts of only those Participants who were
included in the calculation of the amount of the Employer Contribution.
(ii) To the extent that the Employer Contribution for a Plan Year
is reduced by forfeitures, such forfeitures shall be added to such Employer
Contribution and allocated as a part thereof.
(iii) Any excess forfeitures not allocated pursuant to this
Section 4.01(b) shall be carried over to future Plan Years.
4.02 Participant Contributions. If, in the Adoption Agreement, the Employer
has specified that Participants may make either Deductible Voluntary
Contributions or Nondeductible Voluntary Contributions, or both, a Participant
may make such permitted contributions to his or her Account; provided, however,
that a Participant's right to make such contribution(s) shall be subject to the
conditions and limitations specified below.
(a) The following conditions and limitations shall apply if the
Employer has specified that Participants may make Nondeductible Voluntary
Contributions:
(i) The aggregate amount of a Participant's Nondeductible
Voluntary Contributions, plus any nondeductible voluntary contributions he or
she makes under any other qualified retirement plan maintained by the Employer,
shall not exceed 10% of his or her Compensation (disregarding any exclusions
from Compensation specified by the Employer in the Adoption Agreement) for the
period in which he or she has been a Participant in the Plan.
(ii) The aggregate amount of a Participant's Nondeductible
Voluntary Contributions shall not cause the Annual Addition (as defined in
Section 5.05(a) hereof) to his or her Account to exceed the limitations set
forth in Section 5.
(iii) A Participant's Nondeductible Voluntary Contributions shall
be allocated to his or her Nondeductible Voluntary Contribution Account under
Section 6.03 hereof.
(iv) A Participant's Nondeductible Voluntary Contribution Account
shall be nonforfeitable and the Participant may withdraw all or a portion of his
or her Nondeductible Voluntary Contribution Account upon 30 days' written notice
to the Administrator.
(b) The following conditions and limitations shall apply if the
Employer has specified that the Participants may made Deductible Voluntary
Contributions:
(i) The aggregate amount of a Participant's Deductible Voluntary
Contributions in any calendar year may not exceed the lesser of (1) $2,000 or
(2) the Participant's compensation for calendar year for which the contribution
is made. Compensation for this purpose means all wages, salaries, earned income
and other amounts received or derived from
<PAGE>
personal services actually rendered and includible in gross income, but does not
include amounts derived from or received as earnings or profits from property or
amounts received as a pension or annuity or as deferred compensation. This
limitation applies to all the Participant's Deductible Voluntary Contributions
made for the calendar year to all qualified retirement plans maintained by the
Employer. The Administrator shall not accept any contributions in excess of this
limitation.
(ii) A Participant may not make Deductible Voluntary
Contributions for the calendar year in which he or she attains age 70-1/2 or any
calendar year thereafter.
(iii) A Deductible Voluntary Contribution will be considered
contributed for the calendar year in which it is actually made. However, if a
Participant makes a Deductible Voluntary Contribution on or before April 15, he
or she may notify the Administrator at the time the Deductible Voluntary
Contribution is made that it is made for the preceding calendar year. A
Deductible Voluntary Contribution may only be made for a calendar year in which
the Employee was a Participant, and in no event may a Deductible Voluntary
Contribution be made by an Employee after he or she has ceased to be a
Participant.
(iv) All Participant Contributions will be considered to be
Deductible Voluntary Contributions, unless the Employer has elected in the
Adoption Agreement to allow Nondeductible Voluntary Contributions and the
Participant designates before April 15 of the calendar year following the
calendar year in which the contribution was made that the contribution was a
Nondeductible Voluntary Contribution. In such a case, the contribution will be
considered to have been a Nondeductible Voluntary Contribution made during the
calendar year in which it was contributed.
(v) A Participant's Deductible Voluntary Contributions must be in
cash and shall be allocated to his or her Deductible Voluntary Contribution
Account under Section 6.03 hereof.
(vi) A Participant's right to his or her Deductible Voluntary
Contribution Account shall be nonforfeitable and the Participant may withdraw
all or a portion of his or her Deductible Voluntary Contribution Account upon
written application to the Administrator. However, if at the time the
Participant receives the withdrawal, he or she has not attained age 59-1/2 and
is not disabled, the Participant will be subject to a federal income tax penalty
unless, within 60 days of the date he or she receives it, he or she rolls over
the amount withdrawn to an individual retirement plan or, if the Participant can
satisfy the requirement contained in section 4.03(b) below, a qualified
retirement plan.
(vii) The Administrator may, in its discretion, accept
accumulated deductible employee contributions (as defined in Code Section
72(o)(5)) that were distributed from a qualified retirement plan and rolled over
pursuant to Code Sections 402(a)(5), 402(a)(7), 403(a)(4), or 408(d)(3). The
rolled over amount will be added to the Participant's Deductible Voluntary
Contribution Account, but will not be taken into account in applying the
restrictions specified in Section 4.02(b)(i) and (ii) above. In no case may the
Administrator authorize the Plan to accept rollovers of accumulated deductible
employee contributions from a qualified plan to which a contribution was made
for the Participant while the plan was a Top-Heavy Plan (as defined in Section
21.02(b) hereof and applied to such other plan) and the Participant was a Key
Employee (as defined in Section 21.02(a) hereof and applied to such other
employer).
4.03 Rollover Contributions. The Administrator may, in its discretion,
direct the Trustee to accept a Rollover Contribution upon the express request of
the Participant wishing to make such Rollover Contribution, the same to be held,
administered and distributed by the Trustee in accordance with the terms of this
Plan, provided that the Trustee consents if the contribution includes property
other than cash. A Rollover Contribution shall only be a contribution, comprised
of money and/or property, which is a "rollover amount" within the meaning of
Code Section 402(a)(5) or a "rollover contribution" within the meaning of Code
Section 408(d)(3)(A)(ii) (as modified by Code Section 408(d)(3)(C)) with respect
to which both of the following conditions are met:
(a) The transfer of such amount is being made within 60 days of its
receipt by the Participant and
(b) No part of such amount is attributable to contributions made on
behalf of the Participant while he or she was a Key Employee (as defined in
Section 21.02(a) and applied to such other employer) in a Top-Heavy Plan (as
defined in Section 21.02(b) and applied to such other plan).
All Rollover Contributions made under this Section 4.03 must be accepted by
the Trustee within the 60-day period referred to in paragraph (a) above. A
Participant's Rollover Contribution shall at no time be included in the
computation of the maximum allocation to a Participant's Account as set forth in
Section 5 hereof. Each Rollover Contribution made by a Participant shall be
allocated to his or her Rollover Account pursuant to Section 6.03(d) hereof.
Such Rollover Account shall be invested by the Trustee as part of the Trust
Fund, pursuant to Section 11 hereafter, except as it may be held in kind as
permitted above. A Participant may withdraw all or a portion of his or her
Rollover Account upon 30 days' written notice to the Administrator. However, if
the Participant is, or has been, a 5-percent owner (as defined in Code Section
416(i)(1)(B)(i)) and at the time of the withdrawal, he or she has not attained
age 59-1/2 and is not disabled, the Participant will be subject to a federal
income tax penalty unless, within 60 days of the date he or she receives it, he
or she rolls the amount withdrawn to an individual retirement plan or, if the
Participant can satisfy the requirement contained in subsection (b) above, a
qualified retirement plan.
4.04 Transfers from other Qualified Plans. The Administrator may, in its
discretion, direct the Trustee to accept the transfer of any assets held for the
Participant's benefit under a qualified retirement plan of a former employer of
such Participant. Such a transfer shall be made directly between the trustee or
custodian of the former employer's plan and the Trustee in the form of cash or
its equivalent, and shall be accompanied by written instruction showing
separately the portion of the transfer attributable to contributions by the
former employer and by the Participant respectively. Separate written
instructions delivered to the Administrator shall identify the portion of the
transferred funds, if any, attributable to any period during which the
Participant participated in a defined benefit plan, money purchase pension plan
(including a target benefit plan), stock bonus plan or profit sharing plan which
would otherwise have provided a life annuity form of payment to the Participant.
The Administrator shall be entitled to rely on all inclusions and commissions in
such written instructions with respect to character of the transferred funds. To
the extent that the amount transferred is attributable to contributions by the
former employer, it shall be maintained in a separate transfer account. To the
extent that the amount transferred is attributable to contributions by the
Participant, it shall be maintained in the Participant's Nondeductible Voluntary
Contribution Account or Deductible Voluntary Contribution Account as is
appropriate.
SECTION 5.
CODE SECTION 415
LIMITATIONS ON ALLOCATIONS
5.01 Employers Maintaining No Other Plan.
(a) If a Participant does not participate in, and has never
participated in another qualified plan or a welfare benefit fund (as defined in
Code Section 419(e)) maintaned by the Employer, the amount of the Annual
Addition which may be credited to the Participant's Account for any Limitation
Year shall not exceed the lesser of the Maximum Permissible Amount or any other
limitation contained in the Plan.
(b) If the Employer Contribution that would otherwide be allocated to
a Participant's Account would cause the Annual Addition for the Limitation Year
to exceed the Maximum Permissible Amount, the amount allocated will be reduced
so that any Excess Amount shall be eliminated and, consequently, the Annual
Addition for the Limitation Year will equal the Maximum Permissible Amount.
(i) Prior to determining the Participant's actual Compensation
for the Limitation Year, the Employer may determine the Maximum Permissible
Amount for a Participant on the basis of a reasonable estimation of the
Participant's Compensation for the Limitation Year, uniformly determined for all
Participants similarly situated.
(ii) As soon as is administratively feasible after the end of
each Limitation Year, the Maximum Permissible Amount for the Limitation Year
will be determined on the basis of Participants' actual Compensation for the
Limitation Year.
(c) Any Excess Amount shall be eliminated pursuant to the following
procedure:
(i) The portion of the Excess Amount consisting of Nondeductible
Voluntary Contributions which are a part of the Annual Addition (as defined in
Section 5.05(a)) shall be returned to the Participant as soon as
administratively feasible;
(ii) If after the application of subparagraph (i) an Excess
Amount still exists and the Participant is covered by the Plan at the end of the
Limitation Year, the Excess Amount in the Participant's Account will be used to
reduce Employer Contributions (including any allocation of forfeitures) for such
Participant in the next Limitation Year, and each succeeding Limitation Year if
necessary.
(iii) If after the application of subparagraph (i) an Excess
Amount still exists and the Participant is not covered by the Plan at the end of
the Limitation Year, the Excess Amount will be held unallocated in a suspense
account. The suspense account will be applied to reduce proportionally future
Employer Contributions (including any allocation of forfeitures) for all
remaining Participants in the next Limitation Year, and each succeeding
Limitation Year, if necessary. If a suspense account is in existence at any time
during the Limitation Year pursuant to this subparagraph, it will not
participate in the allocation of the Trust's investment gains and losses. In the
event of termination of the Plan, the suspense account shall revert to the
Employer to the extent it may not then be allocated to any Participant's
Account.
(d) Notwithstanding any other provision in subsections (a) through
(c), the Employer shall not contribute any amount that would cause an allocation
to the suspense account as of the date the contribution is allocated.
5.02 Employers Maintaining Other Master or Prototype Defined Contribution
Plans
(a) This Section 5.02 applies if, in addition to this Plan, a
Participant is covered under another qualified Master or Prototype defined
contribution plan or a welfare benefit fund (as defined in Code Section 419(e))
maintained by the Employer during any Limitation Year. The Annual Addition which
may be allocated to any Participant's Account for any such Limitation Year shall
not exceed the Maximum Permissible Amount, reduced by the sum of any portion of
the Annual Addition credited to the Participant's account under such other plans
and welfare benefit funds for the same Limitation Year.
(b) If the Annual Addition with respect to a Participant under other
defined contribution plans and welfare benefit funds maintained by the Employer
of what would be portions of the Annual Addition (if the allocations were made
under the Plan) are less than the Maximum Permissible Amount and the Employer
Contribution that would otherwise be contributed or allocated to the
Participant's Account under this Plan would cause the Annual Addition for the
Limitation Year to exceed this limitation, the amount contributed or allocated
will be reduced so that the Annual Addition under all such plans and funds for
the Limitation Year will equal the Maximum Permissible Amount.
(c) If the Annual Addition with respect to the Participant under such
other defined contribution plans and welfare benefit funds in the aggregate are
equal to or greater than the Maximum Permissible Amount, no amount will be
contributed or allocated to the Participant's Account under this Plan for the
Limitation Year.
(d) If an Excess Amount was allocated to a Participant under this Plan
on a date which coincides with the date an allocation was made under another
plan, the Excess Amount attributed to this Plan will be the product of,
(i) The total Excess Amount allocated as of such date, multiplied
by
(ii) the quotient obtained by dividing
(A) the portion of the Annual Addition allocated to the
Participant for the Limitation Year as of such date by
(B) the total Annual Addition allocations to the Participant
for the Limitation Year as of such date under this and all other qualified
Master or Prototype defined contribution plans maintained by the Employer.
(e) Any Excess Amount attributed to the Plan will be disposed in the
manner described in Section 5.01.
<PAGE>
5.03 Employers Maintaining Other Defined Contribution Plans. If a
Participant is covered under another qualified defined contribution plan which
is not a Master or Prototype plan, the Annual Addition credited to the
Participant's Account under this Plan for any Limitation Year will be limited in
accordance with the provisions of Section 5.02 as though the plan were a Master
or Prototype Plan, unless the Employer provides other limitations pursuant to
the Adoption Agreement.
5.04 Employers Maintaining Defined Benefit Plans. If the Employer
maintains, or at any time maintained, a qualified defined benefit plan covering
any Participant in this Plan, the sum of the Participant's Defined Benefit Plan
Fraction and the Defined Contribution Plan Fraction will not exceed 1.0 in any
Limitation Year. The Annual Addition which may be credited to the Participant's
Account under this Plan for any Limitation Year will be limited in accordance
with the provisions of Section 5.02, unless the Employer provides other
limitations pursuant to the Adoption Agreement.
5.05 Definitions. For purposes of this Section 5, the following terms shall
be defined as follows:
(a) Annual Addition. With respect to any Participant, the "Annual
Addition" shall be the sum of the following amounts credited to a Participant's
Account for the Limitation Year:
(i) Employer Contributions;
(ii) forfeitures; and
(iii) the lesser of
(A) one-half (1/2) the allocated Nondeductible Voluntary
Contributions or
(B) the amount of allocated Nondeductible Voluntary
Contributions in excess of 6% of the Participant's Compensation for the
Limitation Year.
Any Excess Amount applied under Section 5.01(c)(ii) or (iii) or Section
5.02(e) in a Limitation Year to reduce Employer Contributions will be considered
part of the Annual Addition for such Limitation Year. Amounts allocated, after
March 31, 1984, to an individual medical account (as defined in Code Section
415(l)(1)) which is part of a defined benefit plan maintained by the Employer,
are treated as part of the Annual Addition. Also, amounts derived from
contributions paid or accrued after December 31, 1985, in taxable years ending
after such date, which are attributable to post-retirement medical benefits
allocated to the separate account of a Key Employee (as defined in Section
21.02(a) hereof) under a welfare benefit fund (as defined in Code Section
419(e)) maintained by the Employer, are treated as part of the Annual Addition.
(b) Compensation. For the purposes of this Section 5, a Participant's
"Compensation" shall include any earned income, wages, salaries, and fees for
professional services and other amounts received for personal services actually
rendered in the course of employment with the Employer maintaining the Plan
(including, but not limited to commissions paid salesmen, compensation for
services on the basis of a percentage of profits, commissions on insurance
premiums, tips and bonuses), and excluding the following:
(i) Employer contributions to a plan of deferred compensation
which are not includible in the Participant's gross income for the taxable year
in which contributed, or Employer contributions under a simplified employee
pension plan to the extent such contributions are deductible by the Participant,
or any distributions from a plan of deferred compensation;
(ii) Amounts realized from the exercise of a nonqualified stock
option, or when restricted property held by the Participant either becomes
freely transferable or is no longer subject to a substantial risk of forfeiture;
(iii) Amounts realized from the sale, exchange or other
disposition of stock acquired under a qualified stock option; and
(iv) other amounts which received special tax benefits, or
contributions made by the Employer (whether or not under a salary-reduction
agreement) towards the purchase of an annuity described in Code Section 403(b)
(whether or not the amounts are actually excludable from the gross income of the
Participant).
For purposes of applying the limitations of this Section 5, Compensation
for a Limitation Year is the Compensation actually paid or includible in gross
income during such year.
Notwithstanding the preceding sentence, Compensation for a Participant in a
profit sharing plan who is permanently and totally disabled (as defined in Code
Section 22(e)(3)) is the Compensation such Participant would have received for
the Limitation Year if the Participant was paid at the rate of Compensation paid
immediately before becoming permanently and totally disabled; such imputed
compensation for the disabled Participant may be taken into account only if the
Participant is not an officer, an owner, or highly compensated, and
contributions made on behalf of such a Participant are nonforfeitable when made.
(c) Defined Benefit Fraction. The "Defined Benefit Fraction" shall be
a fraction, the numerator of which is the sum of the Participant's Projected
Annual Benefits under all the defined benefit plans (whether or not terminated)
maintained by the Employer, and the denominator of which is the lesser of 125%
of the dollar limitation in effect for the Limitation Year under Code Section
415(b)(1)(A) or 140% of the Participant's Highest Average Compensation.
Notwithstanding the above, if the Participant was a participant in one or
more defined benefit plans maintained by the Employer which were in existence on
July 11, 1982, the denominator of this fraction will not be less than 125% of
the sum of the annual benefits under such plans which the Participant had
accrued as of the later of the end of the last Limitation Year beginning before
January 1, 1983. The preceding sentence applies only if the defined benefit
plans individually and in the aggregate satisfied the requirements of Code
Section 415 as in effect at the end of the 1982 Limitation Year. For purposes of
this paragraph, a Master or Prototype plan with an opinion letter issued before
January 1, 1983, which was adopted by the Employer on or before June 30, 1983,
is treated as a plan in existence on July 1, 1982.
(d) Defined Contribution Fraction. The "Defined Contribution Fraction"
shall be a fraction, the numerator of which is the sum of the Annual Additions
to the Participant's account under all the defined contribution plans (whether
or not terminated) maintained by the Employer for the current and all prior
Limitation Years, (including the Annual Additions attributable to the
Participant's nondeductible employee contributions to all defined benefit plans,
whether or not terminated, maintained by the Employer, and the Annual Additions
attributable to all welfare benefit funds (as defined in Code Section 419(e))),
and the denominator of which is the sum of the Maximum Aggregate Amounts for the
current and all prior Limitation Years of service with the Employer (regardless
of whether a defined contribution plan was maintained by the Employer). The
Maximum Aggregate Amount in any Limitation Year is the lesser of 125% of the
dollar limitation in effect under Code Section 415(c)(1)(A) or 35% of the
Participant's Compensation for such year.
If a Participant was a participant in one or more defined contribution
plans maintained by the Employer which were in existence on July 1, 1982, the
numerator of this fraction will be adjusted if the sum of this Defined
Contribution Fraction and the Defined Benefit Fraction would otherwise exceed
1.0 under the terms of this Plan. Under the adjustment, an amount equal to the
product of
(i) The excess of the sum of the fractions over 1.0, multiplied
by
(ii) the denominator of this Defined Contribution Fraction.
will be permanently subtracted from the numerator of this fraction. The
adjustment is calculated using the fractions as they would be computed as
of the later of the end of the last Limitation Year beginning before
January 1, 1983 or September 30, 1983. This adjustment also will be made
if at the end of the last Limitation Year beginning before January 1, 1984,
the sum of the fractions exceeds 1.0 because of the accruals or additions
that were made before the limitations of this Section 5 became effective to
any plans of the Employer in existence on July 1, 1982. For purposes of
this paragraph, a Master or Prototype plan with an opinion letter issued
before January 1, 1983, which is adopted by the Employer on or before
September 30, 1983, is treated as a plan in existence on July 1, 1982.
(e) Employer. "Employer" means the Employer that adopts this Plan and
all members of (i) a controlled group of corporations (as defined in Code
Section 414(b) as modified by Code Section 415(h)), (ii) commonly controlled
trades or businesses (whether or not incorporated) (as defined in Code Section
414(c) as modified by Code Section 415(h)), or (iii) affiliated service groups
(as defined in Code Section 414(m)) or which the Employer is a part.
(f) Excess Amount. The "Excess Amount" is the excess of what would
otherwise by a Participant's Annual Addition for the Limitation Year over the
Maximum Permissible Amount. If at the end of a Limitation Year when the Maximum
Permissible Amount is determined on the basis of the Participant's actual
Compensation for the year, an Excess Amount results, the Excess Amount will be
deemed to consist of the portion of the Annual Addition last allocated, except
that the portion of the Annual Addition attributable to a welfare benefit fund
will be deemed to have been allocated first regardless of the actual allocation
date.
(g) Highest Average Compensation. A Participant's "Highest Average
Compensation" is his or her average Compensation for the three consecutive Years
of Service with the Employer that produces the highest average. A Year of
Service with the Employer is the 12-consecutive-month period defined in Section
2.52 of the Plan.
(h) Limitation Year. A "Limitation Year" is the Plan Year or any other
12-consecutive-month period specified by the Employer in the Adoption Agreement.
All qualified plans maintained by the Employer must use the same Limitation
Year. If the Limitation Year is amended to a different 12-consecutive-month
period, the new Limitation Year must begin on a date within the Limitation Year
in which the amendment is made.
(i) Master or Prototype Plan. A "Master or Prototype" plan is a plan
the form of which is the subject of a favorable opinion letter from the Internal
Revenue Service.
(j) Maximum Permissible Amount. For a Limitation Year, the "Maximum
Permissible Amount" with respect to any Participant shall be the lesser of
(i) $30,000 (or beginning January 1, 1988, such larger amount
determined by the Commissioner of Internal Revenue for the Limitation Year) or
(ii) 25% of the Participant's Compensation for the Limitation
Year.
If a short Limitation Year is created because of an amendment changing the
Limitation Year to a different 12-consecutive-month period, the Maximum
Permissible Amount will not exceed the quotient determined by first multiplying
$30,000 by the number of months in the short Limitation Year and then dividing
the product by 12.
(k) Projected Annual Benefit. The "Project Annual Benefit" is the
annual retirement benefit (adjusted to an actuarilly equivalent straight life
annuity if such benefit is expressed in a form other than a straight life
annuity or qualified joint and survivor annuity) to which the Participant would
be entitled under the terms of the plan assuming:
(i) the Participant will continue employment until normal
retirement date under the plan (or current age, if later), and
(ii) the Participant's compensation for the current Limitation
Year and all other relevant factors used to determine benefits under the plan
will remain constant for all future Limitation Years.
SECTION 6.
TIME AND MANNER OF MAKING
CONTRIBUTIONS
6.01 Manner. Unless otherwise agreed to by the Trustee, contributions to
said Trustee shall be made only in cash. All contributions may be made in one or
more installments.
6.02 Time. Employer Contributions and Participant Contributions with
respect to a Plan Year shall be made before the time limit, including extensions
thereof, for filing the Employer's federal income tax returns for the Year with
or within which the particular Plan Year ends (or such later time as is
permitted by regulations authorized by the Secretary of the Treasury or
delegate). Rollover Contributions may be made at any time acceptable to the
Administrator in accordance with Section 4.0 hereof. All contributions shall be
paid to the Administrator for transfer to the Trustee, as soon as possible, or,
if acceptable to the Administrator and the Trustee, such contributions may be
paid directly to the Trustee. The Administrator shall transfer such
contributions to the Trustee as soon as possible. The
<PAGE>
Administrator may establish a payroll deduction system or other procedure to
assist the making of Participant Contributions to the Trust, and the
Administrator may from time to time adopt rules or policies governing the manner
in which such contributions may be made so that the Plan may be conveniently
administered.
6.03. Separate Accounts. For each Participant, a separate account shall be
maintained for each of the following types of contributions and the income,
expenses, gains and losses attributable thereto:
(a) Employer Contributions;
(b) Nondeductible Voluntary Contributions, if selected in the Adoption
Agreement;
(c) Deductible Voluntary Contributions, if selected in the Adoption
Agreement;
(d) Rollover Contributions, if, pursuant to Section 4.03 hereof, the
Administrator directs the Trustee to accept such contributions; and
(e) funds directly or indirectly transferred from another qualified
retirement plan pursuant to Section 4.04 hereof, if the Administrator directs
the Trustee to accept such transfers.
In addition, pursuant to Section 7.02(d) and (f) hereof, separate accounts
will be maintained for the pre-break and postbreak Employer Contributions made
on behalf of a Participant who has Service excluded from the calculations of
Vesting Years pursuant to Section 2.50(b) or (c). Notwithstanding the above, if
a Participant's rights to Employer Contributions are immediately and fully
nonforfeitable, Employer Contributions allocated on behalf of such Participant
and his or her Nondeductible Voluntary Contributions may be maintained in a
single account.
SECTION 7.
VESTING
7.01 When Vested. A Participant shall always have a fully vested and
nonforfeitable interest in his or her Nondeductible Voluntary Contribution
Account, Deductible Voluntary Contribution Account and Rollover Account, and any
transfer account established pursuant to Section 4.04 hereof on his or her
behalf. A Participant's interest in his or her Employer Contribution Account
shall be vested and nonforfeitable at Normal Retirement Date, death, Disability,
upon termination (including a complete discontinuance of Employer Contributions)
or partial termination of the Plan and otherwise only to the extent specified in
the Adoption Agreement.
7.02 Forfeitures. If a Participant's employment with the Employer is
terminated before his or her Employer Contribution Account is fully vested in
accordance with Section 7.01 hereof, this Section 7.02 shall apply.
(a) If the Participant completes a period of five consecutive One-Year
Breaks in Service before returning to employment with the Employer, dying or
becoming disabled, the portion of the Participant's Employer Contribution
Account which was not vested at the time of his or her termination shall be
forfeited and
(i) if this Plan is adopted as a profit sharing plan, allocated
exclusively as of the next Valuation Date in the same manner, and to the same
Participants' Employer Contribution Accounts as the Employer Contribution for
that Plan Year is allocated pursuant to Section 4.01 hereof, or
(ii) if this Plan is adopted as a money purchase pension plan,
applied exclusively to reduce the Employer Contributions for the next Plan Year.
(b) No forfeitures shall occur solely as a result of withdrawal of
Deductible Voluntary Contributions, Nondeductible Voluntary Contributions,
Rollover Contributions or amounts held in a transfer account.
(c) Following a forfeiture, the Participant shall be fully vested in
all funds which remain in his or her Employer Contribution Account immediately
after the forfeiture and in all Trust earnings subsequently attributed to such
funds.
(d) If the Participant is reemployed by the Employer after he or she
completes five consecutive One-Year Breaks in Service, an additional Employer
Contribution Account shall be maintained on the Participant's behalf; provided
that, at a subsequent time, the Trustee shall have the discretionary authority
to combine any number of Employer Contribution Accounts maintained for a
Participant, so long as the Participant is 100% vested in each combined account.
All subsequent Employer Contributions made on the Participant's behalf shall be
credited to the Employer Contribution Account which was established at the time
of his or her return to employment with the Employer. The extent to which the
Participant is vested in any additional Employer Contribution Accounts
established on his or her behalf shall be determined independently of any
determination of the extent to which the Participant is vested in any previously
established Employer Contribution Account(s); all such determinations shall be
made in accordance with the provisions in Section 2.50 above.
(e) If the Participant has received a distribution from his or her
Employer Contribution Account pursuant to Section 9 hereof and if the
Participant is reemployed by the Employer before he or she completes five
consecutive One-Year Breaks in Service, the portion of the Employer Contribution
Account which is then vested shall be determined by adding to the then value of
the Employer Contribution Account, the amount, if any, previously distributed
and not repaid to the Trust, applying the vesting percentage then applicable,
and then subtracting the amount previously distributed and not repaid to the
Trust.
(f) Each Employer Contribution Account established pursuant to
subsection (d) hereof (or such Employer Contribution Account into which the
Trustee has combined the accounts pursuant to all powers granted to it in
subsection (d) hereof) shall be credited with its proportionate share of Trust
earnings and losses. For the purposes of the remaining Sections of this Plan,
all Employer Contribution Accounts established in the name of a Participant
shall be treated as a single account.
SECTION 8.
DISTRIBUTION UPON DEATH
8.01 Qualified Preretirement Survivor Annuity. If this Plan is adopted as a
money purchase pension plan, unless an optional form of distribution has been
selected within the Election Period pursuant to a Qualified Election, if a
Participant's Service terminates because of death before distributions have
commenced, then the Trustee shall, upon the direction of the Administrator,
apply 50% of the Participant's vested Account balance toward the purchase of an
annuity contract for the life of the Spouse.
8.02 Other Distributions at Death. If the Participant dies after he or she
has begun to receive distributions pursuant to Section 9.01 or 9.03(b), this
Section 8.02 shall apply with respect to the Participant's entire Account. With
respect to any Account, or portion thereof, to which Section 8.01 did not apply,
if the Participant dies before he or she has begun to receive distributions
pursuant to Sections 9.01 and 9.03(b), this Section 8.02 shall apply with
respect to such Account, or portion thereof. With respect to a portion of the
Participant's Account to which Section 8.01 did apply, if the Participant made a
Qualified Election within the Election Period not to receive a Qualified
Preretirement Survivor Annuity at his or her death and the Participant's Service
terminates because of death before distributions have commenced, this Section
8.02 shall apply with respect to such portion of the Participant's Account.
(a) With respect to any Account of portion thereof to which this
Section 8.02 applies the Trustee shall, at the direction of the Administrator,
distribute the Participant's Account in accordance with the provisions of this
Section 8.02. The Administrator's direction shall include notification of the
Participant's or Beneficiary's death and the existence or non-existence of a
surviving spouse.
(b) If the Participant has validly named a Beneficiary or
Beneficiaries in the most recent Designation of Beneficiary form filed with
Trustee before the Participant's death in compliance with Section 15, his or her
Account shall be distributed to the Beneficiary or Beneficiaries so named. To
the extent that any portion of an Account of a deceased Participant is not
governed by an effective Designation of Beneficiary form which names at least
one living Beneficiary, that portion of the Account shall be distributed to the
deceased Participant's Spouse or if that is not possible, to the estate of the
deceased Participant.
(c) If the Participant has validly elected a manner of distribution
with respect to his or her Account, his or her Account shall be distributed in
accordance with such election. With respect to any portion of a deceased
Participant's Account for which the Participant has not validly elected a manner
of distribution, distribution shall be made in such manner as the Participant's
Beneficiary (or Beneficiaries) may elect, or in the absence of such an election,
in a lump sum.
(d) Distribution to the Participant's Beneficiary shall be made
according to the following provisions:
(i) If the Participant dies before benefits commence and during a
Plan Year which began after December 31, 1984, and if the Spouse is not the
Beneficiary, the Participant's entire Account balance must be distributed to the
Participant's Beneficiary either (A) within five years after the Participant's
death, or (B) in substantially equal annual or more frequent installments over a
period not exceeding the life expectancy of the Beneficiary (as determined as of
the date of the Participant's death by using the return multiples contained in
section 1.72-9 of the Treasury Regulations) provided that such distributions
commence within one year after the Participant's death.
(ii) If the Participant dies before benefits commence and during
a Plan Year which begins after December 31, 1984, and if the Spouse is the
Beneficiary, the Participant's entire Account balance must be distributed to the
Participant's Spouse either (A) within five years after the Participant's death,
or (B) in substantially annual or more frequent installments over a period not
longer than the Spouse's life expectancy (as determined as of the time
distribution is commenced and recalculated annually, by using the return
multiples contained in section 1.72-9 of the Treasury Regulations) provided that
such distribution is commenced on or before the later of the date on which the
Participant would have attained age 70-1/2 or one year after the Participant's
death.
(iii) If distributions have commenced to the Participant before
the Participant's death, distributions to the Participant's Spouse, Beneficiary
or estate shall continue over a period at least as rapid as the period selected
by the Participant.
(e) If a Participant's Beneficiary dies after the Participant and
before he or she receives full payment of the portion of the Participant's
Account balance to which he or she is entitled, the Trustee shall, upon
direction of the Administrator, distribute the funds to which the deceased
Beneficiary is entitled to the beneficiary or beneficiaries validly named on the
most recent designation of beneficiary form filed by the Beneficiary with the
Trustee before the Beneficiary's death. To the extent that any portion of the
funds to which the deceased Beneficiary was entitled are not governed by an
effective designation of beneficiary, the funds shall be distributed to the
deceased Beneficiary's surviving spouse, or if that is not possible, to the
estate of the deceased Beneficiary. The Administrator's direction shall include
notification of the Beneficiary's death and the existence or non-existence of a
surviving spouse.
(i) If distributions had commenced before the Participant's
death, distribution to the beneficiary of a deceased Beneficiary shall continue
over a period at least as rapid as the period selected by the Participant.
(ii) If the deceased Beneficiary was the surviving Spouse of the
Participant and the deceased Beneficiary had not begun to receive distributions
from the Participant's Account at the time of his or her death, the
Participant's Account shall be distributed to the deceased Beneficiary's
beneficiary according to the provisions of this Section 8.02 applied as if the
Beneficiary were the Participant. In addition, the surviving spouse's
beneficiaries shall be treated as Beneficiaries during any future application
of this Section 8.02.
(iii) If neither subparagraph (i) nor (ii) above apply, the
Participant's Account shall be distributed to the deceased Beneficiary's
beneficiary either (A) within five years after the Participant's death, or (B)
in substantially equal annual or more frequent installments over the remainder
of the life expectancy of the Beneficiary as that life expectancy was determined
at the Participant's death (by using the return multiples contained in section
1.72-9 of the Treasury Regulations) provided that distributions commence (or
commenced) within one year of the Participant's death.
(f) If a beneficiary of a Beneficiary (or a beneficiary) dies before
he or she has received full payment of the portion of the Participant's Account
balance to which he or she is entitled, the Trustee shall, after notification by
the Administrator of the beneficiary's death, distribute the funds to which the
deceased beneficiary is entitled to the beneficiary or beneficiaries validly
<PAGE>
named on the most recent designation of beneficiary form filed by the deceased
beneficiary with the Trustee before the beneficiary's death. To the extent that
any portion of the funds to which the deceased beneficiary was entitled are not
governed by an effective designation of beneficiary, the funds shall be
distributed to the deceased beneficiary's surviving spouse, or if that is not
possible, to the estate of the deceased beneficiary.
(i) If distributions had commenced before the Participant's
Death, distribution to the beneficiary of a deceased Beneficiary shall continue
over a period at least as rapid as that selected by the Participant.
(ii) In all other cases, the Participant's Account shall be
distributed to the deceased beneficiary's beneficiary either (A) within five
years after the Participant's death, or (B) in substantially equal annual or
more frequent installments over the remainder of the life expectancy of the
Beneficiary as that life expectancy was determined at the Participant's death
(by using the return multiples contained in section 1.72-9 of the Treasury
Regulations) provided that distributions commence (or commenced) within one year
of the Participant's death.
8.03 Children as Beneficiaries. For the purposes of Section 8.02, any
distribution paid to a Participant's child shall be treated as paid to the
Participant's surviving Spouse if such amount becomes payable to the surviving
Spouse when the child reaches the age of maturity.
SECTION 9
OTHER DISTRIBUTIONS
9.01 Distribution in Plan Years Beginning Before January 1, 1985. During
any Plan Year which begins before January 1, 1985, the Account of any
Participant to which Section 8 does not apply, to the extent it is vested
pursuant to Section 7.01 hereof, will be distributed in accordance with the
terms of this Section 9.01.
(a) A Participant's Account will normally be distributed in monthly
installments which must commence at or within 60 days after the end of the Plan
Year in which occurs his or her Normal Retirement Date or in which his or her
Service ceases, whichever is later, to continue over a period of 120 months;
provided, however, that in the case of a Participant who is an Owner-Employee,
monthly installments to such a Participant must commence no later than the last
day of the Participant's taxable year in which such Participant attains age 70-
1/2. The monthly amount shall normally be the vested balance of the
Participant's Account divided by the remaining number of months in such 120
months, all rounded to the nearest cent. However, the amount of each monthly
installment may be recomputed and adjusted from time to time no more frequently
than monthly as the Trustee may reasonably determine.
(b) All Participants may request and the Administrator shall have the
discretionary power to approve, subject to the requirements stated in this Plan,
any of the following variations from the normal pattern of distribution:
(i) Distributions made or commencing before the Participant's
Normal Retirement Date and following the Participant's attainment of age 59-1/2,
Disability, or separation from Service, if this Plan is adopted as a profit
sharing plan.
(ii) Distributions made or commencing before the Participant's
Normal Retirement Date and following the Participant's Disability or separation
from Service, if this Plan is adopted as a money purchase pension plan.
(iii) Distributions made or commencing after the normal time of
distribution described in Section 9.01(a); provided, however, that any such
deferred distribution must commence no later than the last day of the
Participant's taxable year in which the Participant attains age 70-1/2.
(iv) Distribution of the Participant's entire Account at one
time.
(v) Installment payments of a fixed amount, such payments to be
made until exhaustion of the Participant's Account.
(vi) Distribution in kind.
(vii) Any reasonable combination of the foregoing or any
reasonable time or manner of distribution within the above-stated limitations.
9.02 Timing of Annuity Payments and Normal Distributions in Plan Years
Beginning After December 31, 1984. Payment of benefits under the Qualified
Joint and Survivor Annuity or distributions pursuant to the normal form of
distribution discussed in Section 9.03(b), shall commence after the Participant
attains his or her Normal Retirement Date and on or before the earlier of 60
days after the close of the Plan Year, or the first April 1 after the calendar
year, in which occurs the Participant's Normal Retirement Date or in which his
or her employment ceases, whichever is later; provided, however, that in the
case of a Participant who is a 5-percent owner of the Employer (as defined in
Code Section 416(i)(1)(B)(i)), payment of benefits or monthly installments to
such a Participant must commence on or before the first April 1 after the
calendar year in which such Participant attains age 70-1/2. In the case of a
Participant who becomes a 5-percent owner of the Employer (as defined in Code
Section 416(i)(1)(B)(i)) after attaining age 70-1/2 but before termination of
employment, and during a Plan Year which began after December 31, 1984, payment
of benefits or monthly installments to such Participant must begin on or before
the first April 1 after the calendar year in which Participant becomes a 5-
percent owner.
9.03 Form of Distribution in Plan Years Beginning after December 31, 1984.
During any Plan Year which begins after December 31, 1984, the Account of a
Participant to which Section 8 does not apply, shall be distributed in a form
according to this Section 9.03.
(a) If this Plan is adopted as a money purchase pension plan, unless
the Participant elects an optional form of distribution pursuant to a Qualified
Election within 90 days before the date on which distributions under this
Section 9 would commence, a Participant's Account shall be paid in the form of a
Qualified Joint and Survivor Annuity.
(b) If the Participant was eligible to receive a Qualified Joint and
Survivor Annuity and he or she elects an optional form of distribution pursuant
to a Qualified Election within 90 days before the date on which distributions
under this Section 9 would commence or if this Plan is adopted as a profit
sharing plan and Section 9.03(a) does not apply to the Participant, a
Participant's Account will normally be distributed in monthly installments over
a period equal to the shorter of 120 months or the joint life and last survivor
expectancy of the Participant and his or her spouse (as calculated by using the
return multiples specified in Section 1.72-9 of the Treasury Regulations at the
time of the first distribution). The monthly account shall normally be the
balance of the Participant's Account divided by the remaining number of months
in such period, all rounded to the nearest cent. However, the amount of each
monthly installment may be recomputed and adjusted from time to time no more
frequently than monthly as the Trustee may reasonably determine.
(c) If this Plan is adopted as a money purchase pension plan and the
Participant elects an optional form of distribution pursuant to Qualified
Election within 90 days before the date on which distributions under this
Section 9 will commence and such optional form of distribution is not the normal
form of distribution discussed in subsection (b) or if this Plan is adopted as a
profit sharing plan and the Participant makes a written election to receive an
optional form of distribution, the Administrator shall have the discretion to
approve or disapprove such form of distribution. Pursuant to this Section
9.03(c), the Administrator shall have the discretion to approve of the following
variation from the normal pattern of distribution, provided that the
distribution shall otherwise comply with the requirements of this Plan:
(i) Distributions made or commencing before the Participant's
Normal Retirement Date and following the Participant's attainment of age 59-1/2,
Disability, or separation from Service, if this Plan is adopted as a profit
sharing plan.
(ii) Distributions made or commencing before the Participant's
Normal Retirement Date and following the Participant's Disability or separation
from Service, if this Plan is adopted as a money purchase pension plan.
(iii) Distributions made or commencing after the normal time of
distribution described in Section 9.02; provided, however, that any such
deferred distribution must commence no later than the first April 1 after the
calendar year in which the Participant attains age 70-1/2.
(iv) Distribution of the Participant's entire vested Account
balance at one time, provided that the Participant requests such distribution in
writing.
(v) Installment payments of a fixed amount, such payments to be
made until exhaustion of the Participant's Account.
(vi) Distribution in kind.
(vii) Any reasonable combination of the foregoing or any
reasonable time or manner of distribution within the above-stated limitations.
Notwithstanding the above, if this Plan is adopted as a money purchase
pension plan and a married Participant's vested Account Balance (exclusive of
the Participant's Rollover Account and Deductible Voluntary Contribution
Account) exceeds $3,500, no amount may be distributed to a participant unless
the Participant's Spouse consents in writing to such distribution.
9.04 Required Minimum Distributions. In the case of any Participant to
whom Section 9.01 applies, to whom Section 9.03(a) does not apply, or to whom
Section 9.03(a) applies and who elects an option form of distribution, the
annual distribution from his or her Account must equal or exceed the applicable
required minimum distribution. The minimum distribution to be made for each
calendar year beginning with the calendar year during which distribution is
required to commence pursuant to Section 9.01 or 9.03(b) or (c) shall be the
amount equal to the quotient obtained by dividing the Participant's Account
balance at the beginning of the year by the greater of the life expectancy of
the Participant or the joint life and last survivor expectancy of the
Participant and Beneficiary. For purposes of this minimum distribution rule,
life expectancy and joint life and last survivor expectancy shall be calculated
by using the return multiples specified in section 1.72-9 of the Treasury
Regulations either once, at the time of the first distribution, or in the case
of an expectancy involving only a spousal Beneficiary, annually in a consistent
manner. If the Participant's Spouse is not the Beneficiary, the method of
distribution used must ensure that at least 50% of Present Value (as defined in
Section 21.02(h) hereof) of the Participant's Account balance at the time
distributions commence is paid within the life expectancy of the Participant.
9.05 Nonconsensual Distributions. Notwithstanding any provision of this
Section 9 to the contrary, if a former Participant's vested Account balance
(exclusive of his or her Rollover Account and Deductible Voluntary Contribution
Account) equals $3,500 or less, the Administrator may direct that the entire
vested Account balance be distributed to the former Participant regardless or
whether the former Participant (or his or her Spouse, if applicable) requests or
otherwise consents to such distribution.
9.06 Special One-Time Distribution Election. Notwithstanding any Plan
provision to the contrary and subject to the requirements of Section 9.03(a)
above, distribution on behalf of any Employee, including a 5-percent owner (as
defined in Code Section 416(i)(1)(B)(i)), may be made in accordance with the
following requirements (regardless of when such distribution commences):
(a) The distribution is one which would not have disqualified the
Plan under Code Section 401(a)(9) as it was in effect prior to its amendment by
the Deficit Reduction Act of 1984.
(b) The distribution is in accordance with a method of distribution
designated by the Participant whose interest in the Plan is being distributed
or, if the Participant has died, by a beneficiary of such Participant.
(c) Such designation was in writing, was signed by the Participant or
the beneficiary, and was made before January 1, 1984.
(d) The Participant had accrued a benefit under the Plan as of
December 31, 1983.
(e) The method of distribution designated by the Participant or the
beneficiary specifies the time at which distribution will commence, the period
over which distributions will be made, and in the case of any distribution upon
the Participant's death, the Beneficiaries of the Participant are listed in
order of priority.
(f) If the distribution is one to which the provisions of Section
9.03(a) hereof would otherwise have applied and the Participant is married, the
Participant's spouse consents to the election in a writing filed with the
Administrator.
A distribution upon death will not be covered by this section 9.06 unless
the information in the designation contains the required information
<PAGE>
described above with respect to the distributions to be made upon the death of
the Participant.
For any distribution which commences before January 1, 1984, but continues
after December 31, 1983, the Participant, or the Beneficiary, to whom such
distribution is being made, will be presumed to have designated the method of
distribution under which the distribution is being made if the method of
distribution was specified in writing and the distribution satisfies the
requirement in subsections (a) and (e) above.
If a designation is revoked, any subsequent distribution must satisfy the
requirements of Code Section 401(a)(9) as amended. Any changes in the
designation will be considered to be a revocation of the designation. However,
the mere substitution or addition of another Beneficiary (one not named in the
designation) under the designation will not be considered to be a revocation of
the designation, so long as such substitution or addition does not alter the
period over which distributions are to be made under the designation, directly
or indirectly (for example, by altering the relevant measuring life).
SECTION 10.
LOANS
10.01 Availability of Loans. If, in the Adoption Agreement, the Employer
has specified that loans to Participants are permitted, the Loan Trustee shall,
upon the direction of the Administrator, make one or more loans, including any
renewal thereof, to a Participant (other than a Participant who is an Owner-
Employee). Any such loan shall be subject to such terms and conditions as the
Administrator shall determine pursuant to a uniform policy adopted by the
Administrator for this purpose, which policy shall be at least as restrictive as
required by this Section 10.
10.02 Spousal Consent Required. To obtain a loan, a Participant must
obtain the consent of his or her Spouse, if any, within the 90-day period before
the time his or her Account balance is used as security for the loan.
Furthermore, a new consent is required if an increase in the amount of the
security is necessary and any of the remaining balance of the Account is used.
A spousal consent to a loan must be in writing, witnessed by a Plan
representative or notary public, and acknowledge that as a result of a default
repayment of the loan the Spouse may be entitled to a lesser death benefit than
he or she would otherwise receive under the Plan. A Spouse shall be deemed to
consent to any loan which is outstanding at the time or his or her marriage to
the Participant.
10.03 Equivalent Basis. No such loan may be made to a disqualified person
within the meaning of Code Section 4975(e), unless such loans are available to
all Participants on a reasonably equivalent basis and are not made available to
officers, shareholders or highly paid Participants in an amount which, when
stated as a percentage of any such Participant's Account, is greater than is
available to any other Participants.
10.04 Limitation on Amount. The amount of any such loan, when added to
the outstanding balance of all other loans from the Plan (and any other
qualified retirement plans of the Employer's) to the Participant, shall not
exceed the following:
Participant's Vested Maximum Amount
Account Balance of Loan
$0 - $10,000 100% of vested Account balance
$10,000 - $20,000 $10,000
$20,000 - $100,000 50% of vested Account balance
over $100,000 $50,000
The value of the Participant's Account balance shall be as determined by
the Administrator; provided, however, that such determination shall in no event
take into account the portion of the Participant's Account attributable to the
Participant's Deductible Voluntary Contribution Account.
10.05 Maximum Term. The term of the any such loan shall not exceed 5
years; provided, however, that such limitation shall not apply to any loan used
to acquire, construct, reconstruct, or substantially rehabilitate any dwelling
unit which within a reasonable time is to be sued (determined at the time the
loan is made) as a principal residence of the Participant or a member of the
Participant's family (within the meaning of Code Section 267(c)(4)).
10.06 Promissory Note. Any such loan shall be evidenced by a promissory
note executed by the Participant and payable to the Loan Trustee, on the
earliest of (i) a fixed maturity date meeting the requirements of Section 10.05
above, but in no event later than the Participant's Normal Retirement Date, (ii)
the Participant's death, or (iii) when distribution hereunder is to be made to
the Participant (other than a withdrawal which will not reduce the value of his
or her Account to the extent that the aggregate amount owing could not be made
as a new loan within the limitation set forth in Section 10.04 above). Such
promissory note shall be secured by an assignment of the Participant's Account
to the Loan Trustee. Such promissory note shall evidence such terms as are
required by this Section 10.
10.07 Interest. Any such loan shall be subject to a reasonable rate of
interest.
10.08 Repayment. If a note is not paid when the Participant's benefits
hereunder are to be distributed, then any unpaid portion of such loan and unpaid
interest thereon shall be deducted by the Loan Trustee from the Participant's
Account before benefits are paid from or purchased out of the Account. Such
deduction shall, to the extent thereof, cancel the indebtedness of the
Participant. If a note is not paid when it otherwise becomes payable under
Section 10.05 hereof, or if at any time the Administrator determines that the
aggregate amounts owing by a Participant upon such notes exceed the vested value
of the Participant's Account, the Participant shall be promptly notified in
writing that unless such loan or excess is repaid within 30 days, action will be
taken to collect the same plus any cost of collections. Notwithstanding any
implication of the preceding sentence to the contrary, no attachment of the
Participant's Account shall occur until a distributable event occurs under
Sections 8 or 9 (or if it is otherwise applicable, Section 22) hereof.
10.09 Accounting. Loans shall be made only from the Account of the
Participant (exclusive of that portion of the account attributable to the
Participant's Deductible Voluntary Contribution Account) requesting the loan,
and shall be treated as an investment of such Account. All interest payments
made with respect to such loan shall be credited to the Participant's Account.
10.10 Precedence. This Section 10 overrides Section 16.01 below.
SECTION 11.
TRUST PROVISIONS
11.01 Manner of Investment. All contributions to the Account of a
Participant shall be held in trust by the Trustee designated in the Adoption
Agreement. Except to the extent that a Participant's Account is invested in a
loan pursuant to Section 10 hereof, the Account of a Participant may only be
invested and reinvested in shares of Designated Investment Companies, unless the
Distributor permits less than 100% of the Trust assets to be so invested. If
the Administrator or the Participant, as the case may be, has elected to have a
portion of an Account invested in other than shares of Designated Investment
Companies and the Distributor has authorized the investment of less than 100% of
Trust assets in such shares, the Trustee shall invest such amount in such
investments as it is empowered to invest in under Section 11.03 hereof. The
Designated Investment Companies available for investment may be limited by the
Employer. Investment in the shares of more than one Designated Investment
Company is not permitted unless the value of the Participant's Account and the
value of the investment in each additional Designated Investment Company exceed
amounts from time to time determined by the Distributor.
11.02 Investment Decision.
(a) The decision as to the investment of an Account shall be made by
the person designated in the Adoption Agreement, and the Trustee shall have no
responsibility for determining how an Account is to be invested or to see that
investment directions communicated to it comply with the terms of the Plan. If
the decision is made by the Participant, the Participant shall convey investment
instructions to the Administrator and the Administrator shall promptly transmit
those instructions to the Trustee. Further, if the decision is to be made by
the Participant, the right to make such a decision shall remain with the
Participant upon retirement and shall pass to the Distributee upon death.
(b) The person designated to make the decision as to the investment
of an Account may direct that the investment medium of an Account be changed
provided that no such change may be made from or to an investment other than a
Designated Investment Company except to the extent permitted under Section 11.10
above and by the terms of that other investment vehicle. If the Distributor
determines in its own judgment that there has been trading of shares of
Designated Investment Companies in the Accounts of the Participants, any
Designated Investment Company may refuse to sell its shares to such Accounts.
When an investment is being made or changed, the person designated to do so
shall specify the type of account to which the change refers.
(c) If any decision as to investments is to be made by the
Administrator, it shall be made on a uniform basis with respect to all
Participants.
(d) The Administrator and the Trustee may adopt procedures permitting
Participants to convey their investment instructions directly to the Trustee or
to the transfer agent for the Designated Investment Company or Companies or for
any other investment permitted by the Distributor.
(e) Whenever a Participant is the person designated to make the
decision as to the investment of an Account, the Administrator shall ascertain
that the Participant has received a copy of the current prospectus relating to
the shares of any Designated Investment Company in which such Account is to be
invested plus, where required by any state or federal law, the current
prospectus relating to any other investment in which the Account is to be
invested. With respect to contributions designated for investment by a
Participant, by remitting such a contribution to the Trustee, the Administrator
shall be deemed to warrant to the Trustee fro the benefit of the appropriate
Designated Investment Company or Companies and its or their principal
underwriter that the Participant has received all such prospectuses. By
remitting any other contribution to the Trustee, the Administrator shall be
deemed to warrant to the Trustee for the benefit of the appropriate Designated
Investment Company or Companies and its or their principal underwriter that the
Administrator has received a current prospectus of any Designated Investment
Company in which the contribution is to be invested, plus, where required by any
state or federal law, the current prospectus relating to any other investment in
which contributions are to be invested.
11.03 Investment Powers. To the extent that a portion of the Trust assets
are invested other than in shares of Designated Investment Companies pursuant to
Section 11.01 above, the Trustee is hereby granted full power and authority to
invest and reinvest the Trust assets in any property of any kind or nature
whatsoever (speculative or otherwise) or in any rights or interests therein, or
in any evidences or indicia thereof and whether real, personal or mixed or
whether tangible or intangible (including for illustration but not to be limited
to the following, or anything of a similar kind, character or class: common or
preferred stocks, evidences or ownership in so-called Massachusetts business
trusts, fees, beneficial interests, leaseholds, bonds, mortgages, leases, notes
or obligations, oil and gas payments, oil and gas contracts, other securities,
instruments or commodities, investments in property yielding little or no income
and shares of regulated investment companies) without regard to any rule of law
or statute of the state of the Trustee designation investments eligible for
trust funds, and without respect to any custom or practice either as to types of
investments or diversification of investments, and to hold cash uninvested at
any time and from time to time in such amounts and to such extent as the Trustee
in its own uncontrolled discretion and judgment deems advisable; provided,
however, that the Trustee is to act with the care, skill and diligence, under
the circumstances then prevailing, which would characterize the actions of a
prudent man who is acting as such a Trustee and who is familiar with the duties
of such a Trustee; further provided that the Trustee shall diversify the
investments of the Trust Fund so as to minimize the risk of large losses unless,
under the circumstances, such diversification would not be prudent; further
provided that the Trustee is not empowered to enter into any investment which
would be prohibited under the Act or otherwise by the provisions of this Plan.
Notwithstanding the above, the following restrictions on the investment of
a Participant's Account shall apply:
<PAGE>
(a) No part of a Participant's Deductible Voluntary Contribution
Account may be used to purchase life insurance.
(b) At most, less than one-half of the aggregate Employer
Contributions allocated to a Participant's Employer Contribution Account may be
used to pay premiums attributable to the purchase of ordinary life insurance
contracts (life insurance contracts with both nondecreasing death benefits and
nonincreasing premiums).
(c) No more than one-quarter of aggregate Employer Contributions
allocated to a Participant's Employer Contribution Account may be used to pay
premiums on term life insurance contracts, universal life insurance contracts,
and all other life insurance contracts which are not ordinary life insurance
contracts.
(d) One-half of the amount used to pay premiums on ordinary life
insurance contracts plus the amount used to pay premiums on all other life
insurance contracts may not exceed an amount equal to one-quarter of the
aggregate Employer Contributions allocated to a Participant's Employer
Contribution Account.
(e) No part of a Participant's Account shall be applied towards the
purchase of any insurance contract unless (i) the Trustee applies for and is the
owner of such contract, (ii) the contract provides that all contract proceeds
shall be paid to the Trustee, and (iii) the contract provides for distributions
to the Participant's Spouse, as necessary to ensure compliance with the
applicable requirements of Sections 8, 9, and 22.
If a Participant's Account is invested in one or more insurance contracts,
the Trustee is required to pay over all proceeds of the contract(s) to the
Participant's Beneficiary or Beneficiaries in accordance with the terms of this
Plan and under no circumstances shall the Trust retain any contract proceeds.
11.04 Appointment of Investment Manager. Subject to Sections 11.01 and
11.03 above, the Administrator may designate, and the Employer may contract
with, Scudder, Stevens & Clark, or its successor or any affiliate, to act as
investment manager (within the meaning of the Act), and may at any time revoke
such designation. If an investment manager is so designated, the Trustee shall
follow all investment directions given by the investment manager with respect to
the retention, investment and reinvestment of the Plan assets to the extent they
are under the control of such investment manager. If permitted by the Trustee,
the investment manager may issue orders for the purchase and sale of securities,
including orders through any affiliate of such investment manager. Such an
investment manager is specifically allowed to direct or make investments in
shares of any Designated Investment Company. The Trustee shall not be liable
for following any direction given by, or any actions of, an investment manager
so appointed.
11.05 Trustee: Number, Qualifications and Majority Action.
(a) The number of Trustees shall be one, two or three. Any natural
person and any corporation having the power under applicable law to act as a
trustee of a pension or profit sharing plan may be a Trustee. No person shall
be disqualified from being a Trustee by being employed by the Employer, by being
the Administrator, by being a trustee under any other qualified retirement plan
of the Employer or by being a Participant in this Plan or such other qualified
plan.
(b) A Trustee holding office as sole Trustee hereunder shall have all
the powers and duties herein given the Trustees. When the number of Trustees
hereunder is three, any two of them may act, but the third Trustee shall be
promptly informed of the action. There are two or three Trustees hereunder,
they may, by written instrument communicated to the Employer and the
Administrator, allocate among themselves the powers and duties herein given to
the Trustee hereunder. If such an allocation is made, to the extent permitted
by applicable law, no Trustee shall be liable either individually or as a
trustee for loss to the Plan from the acts or omissions of another Trustee with
respect to duties allocated to such other Trustee.
11.06 Change of Trustee
(a) Any Trustee may resign as Trustee upon notice in writing to the
Employer, and the Employer may remove any Trustee upon notice in writing to each
Trustee. The removal of a Trustee shall be effective immediately, except that a
corporation serving as a Trustee shall be entitled to 60 days' notice which it
may waive, and the resignation of a Trustee shall be effective immediately,
provided that, if the Trustee is the sole Trustee, neither a removal nor a
resignation of a Trustee shall be effective until a successor Trustee has been
appointed and has accepted the appointment. If within 60 days of the delivery
of the written resignation or removal of a sole Trustee another Trustee shall
not have been appointed and have accepted, the resigning or removed Trustee may
petition any court of competent jurisdiction for the appointment of a successor
Trustee or may terminate the Plan pursuant to Section 18 of the Prototype Plan.
The Trustee shall not be liable for the acts and omissions of any successor
trustee.
(b) At any time when the number of Trustees is one or two the
Employer may but need not appoint one or two additional Trustees, provided that
the number of Trustees shall not be more than three. Such an appointment and
the acceptance thereof shall be in writing, and shall take effect upon the
delivery of written notice thereof to all the Trustees and the Administrator and
such acceptance by the appointed Trustee, provided that if a corporation is a
Trustee then in the absence of its consent, such an appointment of an additional
or successor Trustee shall not become effective until 60 days after its receipt
of notice.
(c) Although any Employer adopting the Plan may choose any Trustee
who is willing to accept the Trust, the Distributor or its successor may make or
may have made tentative standard arrangements with any bank or trust company
with the expectation it will be used as the Trustee by a substantial group of
Employers. It is also contemplated that more favorable results can be obtained
with a substantial volume of business, and that it may become advisable to
remove such bank or trust company as the Trustee and substitute another Trustee.
Therefore, anything in the prior to subsections of this Section 11.06
notwithstanding, each Employer adopting this Plan hereby agrees that the
Distributor may, upon a date specified in a notice of at least 30 days to the
affect Employer and in the absence of written objection by the Employer received
by the Distributor before such date (i) remove any such Trustee and in that
case, or if such a Trustee has resigned as to a group of Employers, (ii) appoint
such a successor Trustee, provided such action is taken with respect to all
Employers similarly circumstanced of which the Distributor has knowledge, and
provided such notice is given in writing mailed postage prepaid to the Employer
at the latest address furnished to the Distributor directly or supplied to it by
such Trustee which is to be succeeded. If within 60 days after such Trustee's
resignation or removal, the Employer has not appointed a successor which has
accepted such appointment (unless the appointment of a successor Trustee is
waiting for action by the Distributor pursuant to the next preceding sentence
according to notice which has been given), the Trustee may petition an
appropriate court for the appointment of its successor. The Trustee shall not
be liable for the acts and omissions of such successor.
(d) Successor Trustees qualifying under this Section 11.06 shall have
all rights and powers and all the duties and obligations of original Trustees.
11.07 Valuation. Annually, on the Valuation Date, or more frequently in
the discretion of the Trustee, the assets of the Trust shall be revalued at fair
market value and the accounts of the Trust shall be proportionately adjusted to
reflect income, gains, losses or expenses, if the system of accounting does not
directly accomplish all such adjustments. Each account shall share in income
gains, loses, or expenses connected with an asset in which it is invested
according to the proportion which the account's investment in the asset bears to
the total amount of the Trust Fund invested in the asset. Any dividends or
credits earned on insurance contracts shall be allocated to the specific account
of the Participant from which the funds originated for investment in the
contract.
The Trust Fund shall be administered separately from, and shall not include
any assets being administered under, any other plan of an Employer. Interim
valuations, if any, shall be applied uniformly and in a non-discriminatory
manner for all Employees.
11.08 Registration. Any assets in the Trust Fund may be registered in the
name of the Trustee or any nominee designated by the Trustee.
11.09 Certifications and Instructions.
(a) Any pertinent vote or resolution of the Board of Directors of the
Employer (if it is a corporation) shall be certified to the Trustee over the
signature of the Secretary or an Assistant Secretary of the Employer and under
its corporate seal. The Employer shall promptly furnish to the Trustee
appropriate certification evidencing the appointment and termination of the
individual or individuals serving as Administrator under Section 12.01 of the
Plan.
(b) The Administrator shall furnish to the Trustee appropriate
certification of the individual or individuals authorized to give notice on
behalf of the Administrator and providing specimens of their signatures. All
requests, directions, requisitions for money and instructions by the
Administrator to the Trustee shall be in writing and signed. There may be
standing requests, directions, requisitions or instructions to the extent
acceptable to the Trustee.
11.10 Accounts and Approval
(a) The Trustee shall keep accurate and detailed accounts of all
investments, receipts and disbursements and other transactions hereunder, and
all books and records relating thereto shall be open at all reasonable times to
inspection and audit by any person or persons designated by the Administrator or
by the Employer.
(b) Within 90 days following the close of each Plan Year the Trustee
may, and upon the request of the Employer or the Administrator shall, file with
the Administrator and the Employer a written report setting forth all securities
or other investments (including insurance contracts) purchased and sold, all
receipts, disbursements and other transactions effected by it during the period
since the date covered by the next proper report, and showing the securities and
other property held at the end of such period, and such other information about
the Trust Fund as the Administrator shall request. Unless the Employer or
Administrator, within 90 days from the date of mailing of such report, objects
to the contents of such report, the report shall be deemed approved. Any such
objections shall set forth the specific grounds on which they are based.
11.11 Taxes. The Trustee may assume that any taxes assessed on or in
respect of the Trust Fund are lawfully assessed unless the Administrator shall
in writing advise the Trustee that in the opinion of counsel fro the Employer
such taxes are not lawfully assessed. In the event that the Administrator shall
so advise the Trustee, the Trustee, if so requested by the Administrator and
suitable provision for their indemnity having made, shall contest the validity
of such taxes in any manner deemed appropriate by the Administrator or counsel
for the Employer. The word "taxes" in this Section 11 shall be deemed to
include any interest or penalties that may be levied or imposed in respect to
any taxes assessed. Any taxes, including transfer taxes incurred in connection
with the investment or reinvestment of the assets of the Trust Fund that may be
levied or assessed in respect to such assets shall, if allocable to the Accounts
of specific Participants, be charged to such Accounts, and if not so allocable,
they shall be equitably apportioned among all such Participant's Accounts.
11.12 Employment of Counsel. The Trustee may employ legal counsel (who
may be counsel for the Employer) and shall be fully protected in acting or
refraining from acting, upon such counsel's advice in respect to any legal
questions.
11.13 Compensation of Trustee. An individual Trustee who is an Employee
of the Employer shall not be compensated for services as Trustee. A
corporation, or an individual who is not an Employee of the Employer, serving as
a Trustee shall be entitled to reasonable compensation for services; such
compensation shall be paid in accordance with Section 13.
11.14 Limitation of Trustee's Liability.
(a) The Trustee shall have no duty to take any action other than as
herein specified, unless the Administrator shall furnish it with instructions in
proper form and such instructions shall have been specifically agreed to by it,
or to defend or engage in any suit unless it shall have first agreed in writing
to do so and shall have been fully indemnified to its satisfaction.
(b) The Trustee may conclusively rely upon and shall be protected in
acting in good faith upon any written representation or order from the
Administrator or any other notice, request, consent, certifi-
<PAGE>
cate or other instrument or paper believed by the Trustee to be genuine and
properly executed, or any instrument or paper if the Trustee believes the
signature thereon to be genuine.
(c) The Trustee shall not be liable for interest on any reasonable
cash balances maintained in the Trust.
(d) The Trustee shall not be obligated to, but may, in its
discretion, receive a contribution directly from a participant.
11.15 Successor Trustee. Any corporation into which a corporation acting
as a Trustee hereunder may be merged or with which it may be consolidated, or
any corporation resulting from any merger, reorganization or consolidation to
which such Trustee may be a party, shall be the successor of the Trustee
hereunder, without the necessity of any appointment or other action, provided
the Trustee does not resign and is not removed.
11.16 Enforcement of Provisions. To the extent permitted by applicable
law, the Employer and the Administrator shall have the exclusive right to
enforce any and all provisions of this Agreement on behalf of all Employees and
former Employees of the Employer or their Beneficiaries or other persons having
or claiming to have an interest in the Trust Fund or under the Plan. In any
action or proceeding affecting the Trust Fund or any property constituting a
part or all thereof, or the administration thereof or for instructions to the
Trustee, the Employer, the Administrator and the Trustee shall be the only
necessary parties and shall be solely entitled to any notice of process in
connection therewith; any judgment that may be entered in such action or
proceeding shall be binding and conclusive on all persons having or claiming to
have any interest in the Trust Fund or under the Plan.
11.17 Voting. The Trustee shall deliver, or cause to be executed and
delivered, to the Administrator all notices, prospectuses, financial statements,
proxies and proxy soliciting materials received by the Trustee relating to
securities held by the Trust. The Administrator shall deliver these to the
appropriate Participant or Beneficiary of a deceased Participant, but only if
the Employer has specified in the Adoption Agreement that investment decisions
shall be made by Participants pursuant to Section 11.02 hereof. The Trustee
shall vote securities held by the Trust in accordance with the written
instructions of the person or persons entitled to make investment decisions
pursuant to Section 11.02. If, however, the Trustee is not State Street Bank
and Trust Company and has not received instructions with respect to how to vote
given securities before five full business days prior to the meeting at which
such securities are to be voted, the Trustee may vote such securities. If the
Trustee is State Street Bank and Trust Company and it has not received
instructions with respect to how to vote given securities before two full
business days prior to the meeting at which such securities are to be voted, it
shall not vote such securities except to the extent they are shares of a
Designated Investment Company, in which case it shall vote such securities for
or against each proposal, or abstain from voting on each proposal, in the same
proportion as all other shares of such Designated Investment Company vote or
abstain from voting at the shareholder meeting either in person or by proxy. In
applying the foregoing, the Trustee is not required to vote particular shares of
a Designated Investment Company in the manner specified in the preceding
sentence, so long as all of the shares of the Designated Investment Company as
to which the Trustee has not received instructions are voted in the aggregate in
accordance with the preceding sentence. Notwithstanding the foregoing, the
Trustee shall not have the authority to vote shares of a Designated Investment
Company without instructions from the person or persons entitled to make
investment decisions unless either (a) the Securities and Exchange Commission
shall have issued an exemptive order pursuant to Section 6(c) of the Investment
Company Act of 1940, as amended, the application for which order describes the
Trustee's authorization to so vote without instructions, or (b) the Trustee has
received an opinion of its counsel that the exercise of the authority to vote
shares of a Designated Investment Company without instructions will not render
the Trustee an "affiliated person" as defined in the Investment Company Act of
1940, as amended.
11.18 Applicability to Loan Trustee. Where appropriate, the foregoing
provisions of this Section 11 shall apply to the Loan Trustee on the same basis
as if the Loan Trustee were the Trustee.
SECTION 12.
ADMINISTRATION
12.01 Appointment of Administrator. From time to time, the Employer may,
by identifying such person(s) in writing to both the Trustee and the
Participants, appoint one or more persons as Administrator (hereinafter referred
to in the singular). Such Administrator shall have all power and authority
necessary to carry out the terms of the Plan. A person appointed as
Administrator may also serve in any other fiduciary capacity, including that of
Trustee, with respect to the Plan. The Administrator may resign upon 15 days'
advance written notice to the Employer, and the Employer may at any time revoke
the appointment of the Administrator with or without cause. The Employer shall
exercise the power and fulfill the duties of the Administrator if at any time,
an Administrator has not been properly appointed in accordance with this Section
12.01 or the position is otherwise vacant.
12.02 Named Fiduciaries. The "Named Fiduciaries" within the meaning of
the Act shall be the Administrator and the Trustee.
12.03 Allocation of Responsibilities. Responsibilities under the Plan
shall be allocated among the Trustee, the Administrator, and the Employer as
follows:
(a) Trustee: The Trustee shall have exclusive responsibility to
hold, manage and invest, pursuant to instructions communicated to it in
accordance with Section 11.02 above, the funds received by it subject to the
powers granted to it under Section 11 hereof. To the extent that loans are made
to Participants in accordance with Section 10 hereof, these responsibilities
shall fall to the Loan Trustee.
(b) The Administrator: The Administrator shall have the
responsibility and authority to control the operation and administration of the
Plan in accordance with its terms including, without limiting the generality of
the foregoing, (i) any investment decisions assigned to it under the Adoption
Agreement or transmission to the Trustee of any participant investment decision
under Section 11.02; (ii) interpretation of the Plan, conclusive determination
of all questions of eligibility, status, benefits and rights under the Plan and
certification to the Trustee of all benefits payments under the Plan; (iii)
hiring of persons to provide necessary services to the Plan not provided by
Employees; (iv) preparation and filing of all statements, returns and reports
required to be filed by the Plan with any agency of Government; (v) compliance
with all disclosure requirements of all state or federal law; (vi) maintenance
and retention of all Plan records as required by law, except those required to
be maintained by the Trustee; and (vii) all functions otherwise assigned to it
under the terms of the Plan.
(c) Employer: The Employer shall be responsible for the design of
the Plan, as adopted or amended, the designation of the Administrator and
Trustee (and, if appropriate, the Loan Trustee) as provided in the Plan, the
delivery to the Administrator and the Trustee of Employee information necessary
for operation of the Plan, the timely making of the Employer Contributions
pursuant to Section 4.01 hereof, and the exercise of all functions provided in
or necessary to the Plan except those assigned in the Plan to other persons.
(d) This Section 12.03 is intended to allocate individual
responsibility for the prudent execution of the functions assigned to each of
the Trustees, the Loan Trustee, the Administrator and the Employer and none of
such responsibilities or any other responsibility shall be shared among them
unless specifically provided in the Plan. Whenever one such person is required
by the Plan to follow the directions of another, the two shall not be deemed to
share responsibility, but the person who gives the direction shall be
responsible for giving it and the responsibility of the person receiving the
direction shall be to follow it insofar as it is on its face proper under
applicable law.
12.04 More Than One Administrator. If more than one individual is
appointed as Administrator under Section 12.01, such individuals shall either
exercise the duties of the Administrator in concert, acting by a majority vote
or allocate such duties among themselves by written agreement delivered to the
Employer and the Trustee. In such a case, the Trustee may rely upon the
instruction of any one of the individuals appointed as Administrator regardless
of the allocation of duties among them.
12.05 No Compensation. The Administrator shall not be entitled to receive
any compensation from the funds held under the Plan for its services in that
capacity unless so determined by the Employer or required by law.
12.06 Record of Acts. The Administrator shall keep a record of all its
proceedings, acts and decisions, and all such records and all instruments
pertaining to Plan administration shall be subject to inspection by the Employer
at any time. The Employer shall supply, and the Administrator may rely on the
accuracy of, all Employee data and other information needed to administer the
Plan.
12.07 Bond. The Administrator shall be required to give bond for the
faithful performance of its duties to the extent, if any, required by the Act,
the expense to be borne by the Employer.
12.08 Agent for Service of Legal Process. The Administrator shall be
agent for service of legal process on the Plan.
12.09 Rules. The Administrator may adopt or amend and shall publish to
the Employees such rules and forms for the administration of the Plan, and may
employ or retain such attorneys, accountants, physicians, investment advisors,
consultants and other persons to assist in the administration of the Plan as it
deems necessary or advisable.
12.10 Delegation. To the extent permitted by applicable law, the
Administrator may delegate all or part of its responsibilities hereunder and at
any time revoke such delegation, by written statement communicated to the
delegate and the Employer. The Trustee may, but need not, act on the
instructions of such a delegate. The Administrator shall annually review the
performance of all such delegates.
12.11 Claims Procedure. It is anticipated that the Administrator will
administer the Plan to provide Plan benefits without waiting for them to be
claimed, but the following procedure is established to provide additional
protection to govern unless and until a different procedure is established by
the Administrator and published to the Participants and Beneficiaries.
(a) Manner of Making Claim. A claim for benefits by a Participant or
Beneficiary to be effective under this procedure must be made to the
Administrator and must be in writing unless the Administrator formally or by
course of conduct waives such requirements.
(b) Notice of Reason for Denial. If an effective claim is wholly or
partially denied, the Administrator shall furnish such Participant or
Beneficiary with written notice of the denial within 60 days after the original
claim was filed. This notice of denial shall set forth in a manner calculated
to be understood by the claimant (i) the reason or reasons for denial, (ii)
specific reference to pertinent plan provisions on which the denial is based,
(iii) a description of any additional information needed to perfect the claim
and an explanation of why such information is necessary, and (iv) an explanation
of the Plan's claims procedure.
(c) The Participant or Beneficiary shall have 60 days from receipt of
the denial notice in which to make written application for review by the
Administrator. The Participant or Beneficiary may request that the review be in
the nature of a hearing. The Participant or Beneficiary shall have the rights
(i) to have representation, (ii) to review pertinent documents, and (iii) to
submit comments in writing.
(d) The Administrator shall issue a decision on such review within 60
days after receipt of an application fro review, except that such period may be
extended for a period of time not to exceed an additional 60 days if the
Administrator determines that special circumstances (such as the need to hold a
hearing) requires such extension. The decision on review shall be in writing
and shall include specific reasons for the decision, written in a manner
calculated to be understood by the claimant, and specific references to the
pertinent Plan provisions on which the decision is based.
SECTION 13.
FEES AND EXPENSES
All reasonable fees and expenses of the Administrator or Trustee incurred
in the performance of their duties hereunder or under the Trust shall be paid by
the Employer; and to the extent not so paid by the Employer, said fees and
expenses shall be deemed to be an expense of the Trust and the Trustee is
authorized to charge the same to the Accounts of the
<PAGE>
Participants, and unless allocable to the Accounts of specific Participants,
they shall be charged against the respective accounts of all or a reasonable
group of Participants in such reasonable manner as the Trustee shall determine.
SECTION 14.
BENEFIT RECIPIENT INCOMPETENT OR
DIFFICULT TO ASCERTAIN OR LOCATE
14.01 Incompetency. If any portion of the Trust Fund becomes
distributable to a minor or to a Participant or Beneficiary who, as determined
by the sole discretion of the Administrator, is physically or mentally incapable
of handling his or her financial affairs, the Administrator may direct the
Trustee to make such distribution either to the legal representative or
custodian of, or any of the relatives and friends of, the incompetent or to
apply such distribution directly for the incompetent's support and maintenance.
Payments which are made in good faith shall completely discharge the Employer,
Administrator and Trustee from liability therefor.
14.02 Difficulty to Ascertain or Locate. If it is impossible or difficult
to ascertain the person who is entitled to receive any benefit under the Plan,
the Administrator in its discretion may direct that such benefit be (a) paid to
another person in order to carry out the Plan's purposes; or (b) retained in the
Trust; or (c) paid to a court pending judicial determination of the right
thereto.
SECTION 15.
DESIGNATION OF BENEFICIARY
Each participant and beneficiary may submit to the Trustee a properly
executed Designation of Beneficiary form. In order to be effective, such
designation (a) must have been properly executed and submitted to the Trustee
before the death of the Participant or beneficiary, as the case may be, and (b)
for Participants who die after August 22, 1984 leaving a surviving Spouse, must
be accompanied, or preceded, by a consent of the Participant's Spouse (unless
said Spouse is designated as the sole, primary Beneficiary). Such consent of
the Spouse must be in writing, acknowledge that the effect of such consent is
that the Spouse may receive no benefits under the Plan, be witnessed by a Plan
representative or a notary public, and be a limited consent to the payment of
death benefits to a specific person or persons. The last effective Designation
accepted by the Trustee shall be controlling, and whether or not fully
dispositive of the Participant's Account, thereupon shall revoke all
Designations (and related spousal consents) previously submitted by the
Participant or beneficiary, as the case may be. Each such executed Designation
(and related spousal consent) is hereby specifically incorporated herein by
reference and shall be construed and enforced in accordance with the laws of the
state in which the Trustee has its principal place of business.
SECTION 16.
SPENDTHRIFT PROVISION AND
DISTRIBUTIONS PURSUANT TO QUALIFIED
DOMESTIC RELATIONS ORDERS
16.01 General Spendthrift Rule. No interest of any Participant or
Beneficiary shall be assigned, anticipated or alienated in any manner nor shall
it be subject to attachment, to bankruptcy proceedings or to any other legal
process or to the interference or control of creditors or others, except (a) to
the extent that Participants may secure loans from the Trust with their Accounts
pursuant to Section 10 hereof and (b) pursuant to Section 16.02 hereof.
16.02 Account Division and Distribution Pursuant to Qualified Domestic
Relations Orders. The interest of a Participant may be assigned pursuant to a
"Qualified Domestic Relations Order" (as defined below). The Trustee shall make
distributions of such Participant's interest as are required by the order and
this Section 16.02.
(a) A "Qualified Domestic Relations Order" is any judgment, decree or
order, including the approval of a property settlement agreement (collectively
hereinafter referred to as an "order"), provided that:
(i) The order related to the provision of child support, alimony
or marital property rights and is made pursuant to state domestic relations or
community property laws;
(ii) The order creates or recognizes the existence of an
alternate payee's right to or assigns to an alternative payee rights to, receive
all or a portion of the benefits payable with respect to the Participant under
this Plan;
(iii) The order specifies the name and last known mailing
address of the Participant and each alternative payee covered by the order;
(iv) The order precisely specifies the amount or percentage of
the Participant's benefits to be paid to each alternate payee or the manner in
which the amount of percentage is to be determined;
(v) The order specifies the number of payments or the period to
which the order applies;
(vi) The order specifically names this Plan as a plan to which
the order applies;
(vii) The order does not require the Trustee to provide any form
of distribution other than those contained in Sections 8 and 9 hereof (or
Section 22 hereof, if that Section applies in the Participant's case) other than
in the form of a Qualified Joint and Survivor Annuity with respect to the
alternative payee and his or her subsequent spouse;
(viii) The order does not require the Trustee to provide
benefits at any time in excess of the Account balance;
(ix) If the order requires that distribution to the alternative
payee commence before distribution to the Participant commences, the order:
(A) specifies that, unless the Administrator otherwise
consents, distribution to the alternative payee will not commence prior to ten
years before the Participant's Normal Retirement Date; and
(B) specifies that the amount distributed is to be
calculated as if the Participant had retired on the date on which distributions
are required to commence; and
(x) The order does not require the payment of benefits to an
alternative payee which are required to be paid to another alternative payee
under a previously entered Qualified Domestic Relations Order.
(b) At the request of an alternative payee and pursuant to a
Qualified Domestic Relations Order, the Administrator may, in its discretion,
direct the Trustee to make a lump-sum distribution from a Participant's Account
to an alternative payee at any time prior to time when distribution of such
Account would otherwise occur pursuant to Section 8, 9 or 22 hereof.
(c) The Administrator may, in its discretion, provide a standard form
Qualified Domestic Relations Order to a Participant or any other person, on
request. If this form is properly completed, used without substantial
modification, and incorporated into an order which on its face appears to be
valid, the Administrator shall treat it as a Qualified Domestic Relations Order
and shall distribute named Participant's Account according to its terms. Any
manner of distribution authorized by the Administrator in such a standard form,
other than a manner of distribution specified in Section 8 and 9 hereof, shall
be authorized only as to the alternate payees by whom the standard form has been
used.
(d) The Administrator shall not treat any order entered after January
1, 1985 as a Qualified Domestic Relations Order unless it meets all of the
requirements of subsection (a). For the purposes of this subsection (d), the
Administrator shall treat a domestic relations order entered before January 1985
as a Qualified Domestic Relations Order regardless of whether it meets the
requirements of subsection (a). The Administrator and Trustee shall follow the
terms of a Qualified Domestic Relations Order regardless of whether the Plan has
been joined as a party to the litigation out of which the order arises.
Upon receipt of a domestic relations order entered after January 1, 1985,
the Administrator shall notify the Participant and alternate payee of (i) its
receipt of the order and (ii) its procedures to determine the qualified status
of the order in accordance with subsection (a). Within a reasonable period
after receipt of such order, the Administrator shall determine whether such
order is a Qualified Domestic Relations Order and notify the Participant and
each alternative payee of such determination. The alternate payee may designate
a representative to receive copies of future notices with respect to the
qualified status of the order.
(e) To the extent an order entered after January 1, 1985 calls for
the benefits to be paid to an alternate payee before the qualified nature of the
order is determined, a separate account shall be established to hold the benefit
payments affected by the order. If within 18 months, the Administrator
determines that the order (or a modification thereof) is a Qualified Domestic
Relations Order, the Administrator shall deal with the funds in the separate
account (increased by any earning and decreased by any losses thereon) in
accordance with the instructions of the Qualified Domestic Relations Order. If
within 18 months, the Administrator either (i) determines that the order is not
a Qualified Domestic Relations Order or (ii) is unable to determine whether the
order is a Qualified Domestic Relations Order, the Administrator shall return
the funds in the separate account (increased by any earnings and decreased by
any losses thereon) to the account(s) from which the funds were originally
removed. Any determination by the Administrator that an order is a Qualified
Domestic Relations Order after the expiration of the above discussed 18-month
period shall be applied on a prospective-only basis.
(f) The "alternate payee" referred to in this Section 16.02 shall be
any spouse, former spouse, child or other dependent of the Participant who is
recognized by a domestic relations order as being entitled to receive benefits
payable under the Plan with respect to the Participant. Such alternate payee
shall be considered a "beneficiary" for purposes of the reporting and disclosure
requirements of the Act.
SECTION 17.
NECESSITY OF QUALIFICATION
This Plan is established with the intent that it shall qualify under Code
Section 401(a) as that Section exists at the time the Plan is established. If
the Plan as adopted by the Employer fails to attain such qualification, the Plan
will no longer participate in this Prototype Plan and will be considered an
individually designed plan. If the Plan as adopted by the Employer fails to
attain or retain such qualification, the Employer shall promptly either amend
the Plan under Code Section 401(b) so that it does qualify, or direct the
Trustee to terminate the Trust, and distribute all the assets of the Trust
equitably among the contributors thereto in proportion to their contributions,
and the Plan and the Trust shall be considered to be rescinded and of no force
and effect.
SECTION 18.
AMENDMENT AND TERMINATION
18.01 Amendment or Termination by the Employer. The Employer may at any
time, and from time to time amend this Prototype Plan and the Adoption Agreement
(including a change in any election it has made in the Adoption Agreement), or
suspend or terminate this Plan by giving written notice to the Trustee, but the
Trust may not thereby be diverted from the exclusive benefit of the
Participants, their Beneficiaries, survivors or estates, or the administrative
expenses of the Plan, nor revert to the Employer, nor may an allocation or
contribution theretofore made be changed thereby, nor may any amendment directly
or indirectly deprive a Participant of such Participant's nonforfeitable rights
to benefits accrued to the date of the amendment.
No amendment to the Plan shall be effective to the extent that it would
have the effect of decreasing a Participant's Account balance or eliminating an
optional form of distribution. Notwithstanding the preceding sentence, a
Participant's Account balance may be reduced to the extent permitted under Code
Section 412(c)(8). Furthermore, no amendment to the Plan shall have the effect
of decreasing a Participant's vested interest determined without regard to such
amendment as of the later of the date such amendment is adopted or the date on
which it becomes effective.
The Employer may amend the Plan by adding overriding Plan language to the
Adoption Agreement where such language is necessary to satisfy Code Sections 415
or 416 because of the required aggregation of multiple plans under these Code
Sections. The Employer may also amend the Plan by adding language to allow the
Plan to operate under a waiver of the minimum funding requirement.
Any amendment by the Employer which is other than (a) a change in the
Employer's prior designation of an option in the Adoption Agreement (b) an
amendment referred in the Adoption Agreement which will allow the Plan to
satisfy the requirements of Code Section 415 or to avoid duplication of minimum
<PAGE>
benefits or accruals under Code Section 416 because of the required aggregation
of multiple plans, or (c) an amendment which allows the Plan to operate under a
waiver of the minimum funding requirement, will constitute a substitution by the
Employer of an individually designed plan for this Prototype Plan; thereafter,
the Plan shall no longer participate in the Prototype Plan and the general
amendment procedure of the Internal Revenue Service governing individually
designed plans will be applicable.
If an amendment changing the vesting schedule is executed (including
execution of this Adoption Agreement as an amendment to an existing plan),
Participants with five or more Vesting Years before the expiration of the
election period described in the next sentence shall have the right to elect the
vesting schedule in effect on the day before the election period. The election
period shall commence on the date the amendment is adopted and end on the latest
of (a) 60 days after the amendment is adopted, (b) 60 days after the Effective
Date, or (c) 60 days after the Participant is issued written notice of the
amendment by the Administrator. Failure to so elect shall be treated as a
rejection and such election or rejection shall be final.
Nothing contained herein shall constitute an agreement or representation by
any Sponsor or the Distributor that it will continue to maintain its sponsorship
of the Plan indefinitely.
18.02 Delegation. The Employer hereby delegates to the Sponsor the
authority to amend so much of the Adoption Agreement and this Prototype Plan as
in prototype form and, to the extent to which the Employer could effect such
amendment, the Employer shall be deemed to have consented to any amendment so
made. When an election within the prototype form has been made by the Employer,
it shall be deemed to continue after amendment of the prototype form unless and
until the Employer expressly further amends the election, notwithstanding that
the provision for the election in the amended prototype form is in a different
form or place; provided, however, that if the amended from inadvertently fails
to provide means to duplicate exactly the earlier election, such earlier
election shall continue until such further amendment. The immediately preceding
sentence is subject to the qualification that each Employer hereby delegates to
the Sponsor, in the event of such an amendment of the prototype form, authority
to determine conclusively that such a continuation of an earlier election by the
Employer is not advisable and to make the election for the Employer in the
amended prototype form which in the judgment of the Sponsor most nearly
corresponds with the election made by the Employer before the amendment of the
prototype form, provided the following procedure is followed: the election for
the Employer may be made with respect to any specified Employers as to whom it
may be made applicable singly, or such election may be made with respect to all
Employers as to whom it may be made applicable as a group; and the election
shall be made as of an effective date which has been specified on a notice
mailed or delivered, at the last address(es) of the Employer(s) on the records
of the Distributor, to the Employer(s) at least 20 days before the end of the
remedial amendment period. Such notice may be mailed to Employers to whom it
cannot be applicable by reason of a previous election made by the Employer or
otherwise, but it shall be effective only as to those Employers who have
received the notice and have not themselves made a new election with respect to
that item since the amendment of the prototype form and previous to the
effective date of such election by the Sponsor. The foregoing delegations of
authority to make elections, or to make amendments, shall not impose any duty on
the Sponsor to make a given election or amendment and shall not affect the
interpretation of the Plan if any so delegated authority is not used.
18.03 Distribution of Accounts Upon Termination. Upon termination or
partial termination of the Plan or, if this Plan is adopted as a profit sharing
plan, complete discontinuance of Employer Contributions under it, the
Administrator shall determine whether to pay the interests of Participants,
former Participants and Beneficiaries immediately, to retain such interest in
the Trust and pay them in the future according to Section 8, 9 and/or 22 as
applicable, or to use what other methods the Administrator deems advisable in
order to furnish whatever benefits the Trust will provide; provided any such
distributions pursuant to this Section 18.03 shall comply with the requirements
of Section 8, 9, and/or 22 hereof.
SECTION 19.
TRANSFERS
Nothing contained herein shall prevent the merger or consolidation of the
Plan with, or transfer of assets or liabilities of the Plan to, another plan
meeting the requirements of Code Section 401(a) or the transfer to the Plan of
assets or liabilities of another such plan so qualified under the Code. Any
such merger, consolidation or transfer shall be accompanied by the transfer of
such existing records and information as may be necessary to properly allocate
such assets among Participants, including any tax or other information necessary
for the Participants or persons administering the plan which is receiving the
assets. The terms of such merger, consolidation or transfer must be such that
if this Plan is then terminated, the requirements of Section 18.01 hereof would
be satisfied and each Participant would receive a benefit immediately after the
merger, consolidation or transfer equal to or greater than the benefit he or she
would have received if the Plan had terminated immediately before the merger,
consolidation or transfer.
SECTION 20.
OWNER-EMPLOYEE PROVISIONS
20.01 Purpose of Section. This Section is intended to insure that the
Plan complies with Code Section 401(d). Any ambiguity herein will be construed
to that end, and this Section 20 will override any other provision of the Plan
with which it may be inconsistent.
20.02 Control. For purposes of this Section 20, "Control" means the
ownership directly or indirectly of more than 50% of either the capital interest
or the profits interest in a partnership or an unincorporated trade or business.
For the purposes of applying the preceding sentence, an Owner-Employee, or 2 or
more Owner-Employees shall be treated as owning any interest in a partnership
which is owned, directly or indirectly, by a partnership which such Owner-
Employee, or such 2 or more Owner-Employees, are considered to Control.
20.03 Limitations. No benefits shall be provided to an Owner-Employee
under this Plan unless:
(a) if an Owner-Employee or group of Owner-Employees Controls the
trade or business covered by this Plan and also Control as an Owner-Employee or
Owner-Employees one or more other trades or businesses, this Plan and the plans
established for such other trades or businesses, when taken together, form a
single plan which satisfies the requirements of Sections 401(a) and (d) of the
Code with respect to the Employees of all the controlled trades or businesses;
and
(b) if an Owner-Employee or group of Owner-Employees controls another
trade or business but does not control the trade or business covered by this
Plan, the employees of such other trades or business are included in a Plan
which satisfies the requirements of Sections 401(a) and (d) of the Code and
which provides contributions and benefits for such employees which are not less
favorable than those provided for Owner-Employees under this Plan; and
(c) if an Owner-Employee is covered under the qualified retirement
plans of two or more trades or businesses which he or she does not Control but
the Owner-Employee Controls a trade or business, contributions or benefits for
the employers under the plan of the trade or business which the Owner-Employee
Controls are not less favorable than those provided for the Owner-Employee in
the most favorable qualified retirement plan of the trade(s) or business(es)
which the Owner-Employee does not Control.
SECTION 21.
TOP-HEAVY PROVISIONS
21.01 Purpose of Section. This Section is intended to insure that the
Plan complies with Code Section 416. If the Plan is or becomes Top-Heavy in any
Plan Year beginning after December 31, 1983, the provisions of this Section will
supersede any conflicting provision in the Plan.
21.02 Definitions. The terms used in this Section shall have the
following meanings:
(a) Key Employee: Any Employee or former Employee (and the
Beneficiaries of such Employee) who at any time during the determination period
was (i) an officer of the Employer having an annual compensation greater than
1.5 multiplied by the amount in effect under Code Section 415(c)(1)(A) for the
Plan Year (subject to the limitation that no more than the lesser of (A) 50
Employees or (B) the greater of 3 Employees or 10% of the Employees shall be
deemed to be officers), (ii) an owner (or considered an owner under Code Section
318) or 1 of the 10 largest interest in the Employer if both such individual was
an owner of more than 5% interest in the Employer (aggregated with the Employer
for this purpose are all members of (i) a controlled group of corporations (as
defined in Code Section 414(c) as modified by Code Section 415(h)), or (iii)
affiliated service groups (as defined in Code Section 414(m)) of which the
Employer is a part) and such individual's compensation exceeds the dollar
limitation under Code Section 415(c)(1)(A), (iii) a five-percent owner of the
Employer, or (iv) a one-percent owner of the Employer who has an annual
compensation of more than $150,000. The determination period is the Plan Year
containing the Determination Date and the 4 preceding Plan Years. The
determination of who is a Key Employee will be made in accordance with Code
Section 416(i)(1) and the regulations thereunder.
(b) Top-Heavy Plan. For any Plan Year beginning after December 31,
1983, this Plan is Top-Heavy if any of the following conditions exist:
(i) If the Top-Heavy Ratio for this Plan exceeds 60% and this
Plan is not part of any Required Aggregation Group or Permissive Aggregation
Group of plans.
(ii) If this Plan is part of a Required Aggregation Group of
plans but not part of a Permissive Aggregation Group and the Top-Heavy Ratio for
the Required Aggregation Group of plans exceeds 60%.
(iii) If this Plan is a part of a Required Aggregation Group and
part of a Permissive Aggregation Group of plans and the Top-Heavy Ratio for the
Permissive Aggregation Group exceeds 60%.
(c) Top-Heavy Ratio.
(i) If the Employer maintains one or more defined contribution
plans (including any Simplified Employee Pension Plan within the meaning of Code
Section 408(k)) and the Employer has not maintained any defined benefit plan
which during the five-year period ending on the Determination Date(s) has or has
had accrued benefits. Top-Heavy Ratio for this Plan alone or for the Required
Aggregation Group or Permissive Aggregation Group, as appropriate, is a
fraction, the numerator of which is the sum of the account balances under all of
the plans as of the Determination Date(s) (including any part of any account
balance distributed in the five-year period ending on the Determination Date(s))
of all Key Employees who have received compensation from the Employer (other
than benefits under a qualified retirement plan) at any time during the five-
year period ending on the Determination Date(s), and the denominator of which is
the sum of all account balances as of the Determination Date(s) (including any
part of any account balance distributed in the five-year period ending on the
Determination Date(s)), of all Participants who have received compensation from
the Employer (other than benefits under a qualified retirement plan) at any time
during the five-year period ending on the Determination Date(s). Both the
numerator and denominator of the fraction shall be computed in accordance with
Code Section 416 and the Treasury Regulations promulgated thereunder. In
addition, both the numerator and denominator of the Top-Heavy Ratio shall be
adjusted to reflect any contribution which is not actually made as of the
Determination Date(s), but which is required to be taken into account on that
date under Code Section 416 and the Treasury Regulations promulgated thereunder.
(ii) If the Employer maintains one or more defined contribution
plans (including any Simplified Employee Pension Plan within the meaning of Code
Section 408(k)) and the Employer maintains or has maintained one or more defined
benefit plans which during the five-year period ending on the Determination
Date(s) has or has had accrued benefits, the Top-Heavy Ratio for any Required
Aggregation Group or Permissive Aggregation Group, as appropriate, is a
fraction, the numerator of which is the sum of (A) account balances under the
defined contribution plans as of the Determination Date(s) (including any part
of any account balance distributed in the five-year period ending on
<PAGE>
the Determination Date(s)) of all Key Employees who have received compensation
from the Employer (other than benefits under a qualified retirement plan) at any
time during the five-year period ending on the Determination Date(s) and (B) the
present value of accrued benefits under the defined benefit plans for all Key
Employees, who have received compensation from the Employer (other than benefits
under a qualified retirement plan) at any time during the five-year period
ending on the Determination Date(s) and the denominator of which is the sum of
(A) the account balances under the defined contribution plans as of the
Determination Date(s) (including any part of any account balance distributed in
the five-year period ending on the Determination Date(s)) of all participants
who have received compensation from the Employer (other than benefits under this
Plan) at any time during the five-year period ending on the Determination
Date(s) and (B) the present value of accrued benefits under the defined benefit
plans for all participants who have received compensation from the Employer
(other than benefits under this Plan) at any time during the five-year period
ending on the Determination Date(s). Both the numerator and denominator of the
fraction shall be computed in accordance with Code Section 416 and the Treasury
Regulations promulgated thereunder. In addition, both the numerator and
denominator of the Top-Heavy Ratio shall include aggregate distribution(s) of an
account balance or an accrued benefit made during the five-year period ending on
the Determination Date(s) and any contribution which is not actually made as of
the Determination Date(s), but which is required to be taken into account on
that date under Code Section 416 and the Treasury Regulations promulgated
thereunder.
(iii) For purposes of (i) and (ii) above, the value of account
balances and the present value of accrued benefits will be determined as of the
most recent Valuation Date that falls within, or ends with, the 12-month period
ending on the Determination Date, except as provided in Code Section 416 and the
Treasury Regulations promulgated thereunder for the first and second plan years
of a defined benefit plan. The account balances and accrued benefits of a
Participant (A) who is not a Key Employee but who was a Key Employee in a prior
Plan Year or (B) who has not been credited with at least one Hour of Service at
any time during the five-year period ending on the Determination Date, will be
disregarded. The calculation of the Top-Heavy Ratio, and the extent to which
distributions, rollovers, and transfers are taken into account will be made in
accordance with Code Section 416 and the Treasury Regulations promulgated
thereunder. Deductible Voluntary Contributions and any deductible employee
contributions under any other qualified plan maintained by the Employer will not
be taken into account for purposes of computing the Top-Heavy Ratio. When
aggregating plans the value of account balances and accrued benefits will be
calculated with reference to the Determination Dates that fall within the same
calendar year.
(d) Permissive Aggregation Group. The Required Aggregation Group of
plans plus any other plan or plans of the Employer which, when considered as a
group with the Required Aggregation Group, would continue to satisfy the
requirements of Code Sections 401(a)(4) and 410.
(e) Required Aggregation Group. (i) Each qualified plan of the
Employer in which at least one Key Employee participates or participated at any
time during the determination period (regardless of whether the plan has
terminated), and (ii) any other qualified plan of the Employer which enables a
plan described in (i) to meet the requirements of Code Sections 401(a)(4) or
410.
(f) Determination Date. For any Plan Year subsequent to the first
Plan Year, the Determination Date shall be the last day of the preceding Plan
Year. For the first Plan Year of the Plan, the Determination Date shall be the
last day of that year.
(g) Valuation Date. See Section 2.49.
(h) Present Value. Present value shall be based only on the interest
rate employed as of the date in question by the Pension Benefit Guaranty
Corporation to value immediate annuities and the mortality rate specified in
Table LN at Treas. Reg. 20.2031-10, unless otherwise specified in the most
recently adopted or amended defined benefit plan maintained by the Employer.
21.03 Minimum Allocation.
(a) In any Plan Year in which this Plan is Top-Heavy, except as
otherwise provided in (d), (e) and (f) below, the Employer Contributions and
forfeitures allocated on behalf of any Participant who is not a Key Employee
shall not be less than the lesser of 3% of such Participant's Compensation or,
in the case where the Employer has no defined benefit plan which designates this
Plan to satisfy Code Section 401, the largest percentage of Employer
Contributions and forfeitures stated as a percentage of the first $200,000 of a
Key Employee's Compensation, allocated on behalf of any Key Employee for that
Plan Year. The minimum allocation is determined without regard to any Social
Security contribution by the Employer. This minimum allocation shall be made
even though, under other provisions of this Plan, the Participant would not
otherwise be entitled to receive an allocation, or would have received a lesser
allocation for the year because (i) the Participant failed to complete the
minimum number of Hours of Service specified in the Adoption Agreement for
receiving an allocation, (ii) the Participant's Compensation was less than a
stated amount, or (iii) the Participant made insufficient mandatory
contributions to receive an Employer Contribution (allocated on a thrift
matching basis) sufficient to alleviate the need a minimum allocation under this
Section 21.03.
(b) For purposes of computing the minimum allocation, "Compensation"
will have the same meaning as in Section 2.07, disregarding any exclusion from
Compensation specified by the Employer in the Adoption Agreement.
(c) During any Plan Year for which a minimum allocation is required
under subsections (a) or (f) to a plan under which allocations shall be made on
an integrated basis pursuant to Section 4.01(a)(iii) or 4.01(b) or a matching
basis pursuant to Section 4.01(a)(ii)(B), Employer Contributions and forfeitures
will be allocated to each Participant's Employer Contribution Account in the
ratio that the Participant's Compensation for the Plan Year bears to all
Participants' Compensation for the Plan Year but not in excess of 3% of such
Compensation. The provisions of this Section 21.03(c) shall take precedence
over any conflicting provisions of Section 4.01. To the extent any amount of
Employer Contributions and forfeitures remains unallocated after the application
of this subsection (c), such amount shall be allocated in accordance with the
provisions of Section 4.01 hereof.
(d) The provision in subsection (a) above shall not apply to any
Participant who was not employed by the Employer on the last day of the Plan
Year.
(e) The provision in subsection (a) above shall not apply to any
Participant to the extent the Participant is covered under any other plan (other
than a plan which incorporates the Prototype Plan) or plans of the Employer, and
the Employer has provided in the Adoption Agreement that the minimum allocation
or benefit requirement applicable to Top-Heavy Plans will be met in such other
plan or plans.
(f) The provision in subsection (a) above shall not apply in the
case of a Participant who is an Employee of an Employer who has adopted both a
profit sharing plan and a money purchase pension plan which incorporate this
Prototype Plan. In such case, the aggregate total of the Employer Contributions
and forfeitures under both plans allocated to the Employer Contribution Account
of a Participant who is not a Key Employee shall not be less than 3% of such
Participant's Compensation. Unless the Employer has specified otherwise in the
Adoption Agreement and such specification is sufficient to satisfy the minimum
allocation requirement referred to in the preceding sentence, subsection (c)
above shall apply to the allocation of Employer Contributions and forfeitures
under the profit sharing plan and, only to the extent that such allocation is
insufficient to satisfy the minimum allocation requirement referred to in the
preceding sentence, the money purchase pension plan.
21.04 Nonforfeitability of Minimum Allocation. The minimum allocation
required (to the extent required to be nonforfeitable under Code Section 416(b))
may not be forfeited under Code Section 411(a)(3)(B) or 411(a)(3)(D).
21.05 Limitation on Compensation. For any Plan Year in which the Plan is
Top-Heavy, only the first $200,000 (or such larger amount as may be prescribed
by the Secretary of the Treasury or his or her delegate) of a Participant's
Compensation for the Plan Year shall be taken into account for purposes of
allocating Employer Contributions under the Plan.
21.06 Minimum Vesting Schedule. Unless the Employer has specified a more
rapid vesting schedule in the Adoption Agreement, for any Plan Year in which
this Plan is Top-Heavy, the following minimum vesting schedule shall apply:
Nonforfeitable Percentage of
Vesting Years Employer Contribution Account
1 0%
2 20
3 40
4 60
5 80
6 or more 100
The minimum vesting schedule applies to all benefits within the meaning of
Code Section 411(a)(7) attributable to Employer Contributions and forfeitures,
including benefits accrued before the effective date of Code Section 416 and
benefits accrued before the Plan became Top-Heavy. Further, no reduction in
vested benefits may occur in the event the Plan's status as Top-Heavy changes
for any Plan Year. IF conversion of the Plan into a Top-Heavy Plan has resulted
in a change of the Plan's vesting schedule to the minimum vesting schedule
discussed above, the change shall be treated as an amendment to the Plan and the
election referred to in Section 18.01 hereof shall apply. This Section 21.06
does not apply to the Employer Contribution Account balances of any former
Participant who does not have an Hour of Service after the Plan has initially
become Top-Heavy and such former Participant's vested Employer Contribution
Account balance will be determined without regard to this Section.
21.07 Effect on Code Section 415 Limitations. Notwithstanding anything to
the contrary in Section 5 above, the following provisions apply if the Plan is
Top-Heavy.
(a) In any Plan Year in which the Top-Heavy ratio exceeds 90% (and
the Plan therefore becomes super Top-Heavy) the denominators of the Defined
Benefit Fraction (as defined in Section 5.05(c) above) and the Defined
Contribution Fraction (as defined in Section 5.05(d) above) shall be computed
using 100% of the dollar limitation stated therein instead of 125%.
(b) In any Plan Year in which the Top-Heavy Ratio exceeds 60%, but is
less than 90%, the denominators of the Defined Benefit Fraction (as defined in
Section 5.05(c) above) and the Defined Contribution Fraction (as defined in
Section 5.05(d) above) shall be computed using 100% of the dollar limitation
described therein instead of 125%, unless the Employer has specified in the
Adoption Agreement that the minimum allocation provisions of Section 21.03 above
shall be computed using 4% of a Participant's Compensation, in which case the
dollar limitations of the Defined Benefit Fraction (as defined in Section
5.05(c) above) and the Defined Contribution Fraction (as defined in Section
5.05(d) above) shall continue to be computed using 125% of the dollar
limitations.
21.08 Termination of Top-Heavy Status. If the Plan ceases to be Top-Heavy
for any Plan Year and if the Employer has not specified otherwise in the
Adoption Agreement, the minimum vesting schedule described in Section 21.06
shall continue to apply. If the Employer has specified in the Adoption
Agreement that, upon conversion of the Plan to non-Top-Heavy status,
Participants' vested benefits are to be determined according to a schedule other
than the minimum vesting schedule described in Section 21.06, such change in
vesting schedules shall be treated as an amendment, and the election referred to
in Section 18.01 hereof shall apply.
SECTION 22.
SPECIAL DISTRIBUTION RULES
22.01 Special Rule for Profit Sharing Plan Participants. If this Plan is
adopted as a profit sharing plan and (a) it is determined that this Plan is a
direct or indirect transferee (including a plan which is amended into this Plan)
of a defined benefit plan, money purchase pension plan (including a target
benefit plan), stock bonus or profit sharing plan which would otherwise provide
a life annuity form of payment with respect to such Participant, (b) the Plan is
amended so as to allow a Participant to elect to receive his or her benefits in
the form of a life annuity and Participant elects to receive his or her
<PAGE>
benefits in such form, (c) the Plan is amended to provide that absent a
Qualified Election of a Participant's surviving spouse, someone other than the
Participant's surviving spouse becomes entitled to the Participant's vested
Account balance, or (d) if someone other than the Participant's surviving spouse
is the beneficiary of any insurance purchased with funds from the Participant's
Account, the provisions of Sections 8, 9, and 15 shall apply as if this Plan
were adopted as a money purchase pension plan.
22.02 Elections for Former Participants. An opportunity to make the
applicable distribution elections discussed below in this Section 22.02 must be
given to any living former Participant who had not begun receiving benefits from
this Plan on August 23, 1984 and who would not otherwise receive the benefit
forms prescribed by Sections 8 and 9 above.
(a) In the case of a former Participant who:
(i) would have been entitled to receive his or her benefits in
the form of a life annuity had he or she completed an Hour of Service during a
Plan Year commencing after December 31, 1984,
(ii) was credited with Service under this Plan or a predecessor
plan in a plan year beginning after December 31, 1975, and
(iii) had at least ten years of vesting Service when he or she
separated from Service,
the former Participant must be given an opportunity to elect to receive his or
her benefits in accordance with the provisions of Sections 8 and 9 applied as if
this Plan were adopted as a money purchase pension plan.
(b) In the case of a former Participant:
(i) who was credited with service under this Plan or a
predecessor plan after September 1, 1974;
(ii) who was not credited with service under this plan or a
predecessor plan in a plan year beginning after December 31, 1975; and
(iii) whose benefits would have been payable in the form of a
life annuity
the Participant must be given an opportunity to elect to receive his or her
benefits in accordance with the provisions of Section 22.04.
(c) In the case of a former Participant who:
(i) satisfies the requirements of subsection (a) but does not
exercise the election made available to him or her in subsection (a), or
(ii) satisfies the requirements of subsection (a) other than the
requirement of paragraph (iii),
the former participant shall have his or her benefits distributed in accordance
with the provisions of Section 22.04.
22.03 Election Period for Certain Elections by Separated Participants.
The period during which a former Participant entitled to make an election
pursuant to Section 22.02 shall commence on August 23, 1984 and end on the
earlier of the former Participant's death or the date benefits would otherwise
commence to said former Participant.
22.04 Benefit Form for Certain Former Participants. The benefits of a
former Participant who is entitled to elect, and has elected to have his or her
benefits distributed pursuant to this Section 22.04 or a former Participant
whose benefits are required to be distributed in accordance with the provisions
of this Section 22.04 shall be distributed in accordance with the following
provisions:
(a) If benefits in the form of a life annuity become payable to a
married former Participant who:
(i) begins to receive payments under the Plan on or after Normal
Retirement Age; or
(ii) dies on or after Normal Retirement Age while still working
for the Employer; or
(iii) begins to receive payments prior to Normal Retirement Age;
or
(iv) separates from Service on or after attaining Normal
Retirement Age (or the qualified early retirement age) after satisfying the
eligibility requirement for the payment of benefits under the Plan and
thereafter dies before beginning to receive such benefits;
then such benefits will be received under this plan in the form of a Qualified
Joint and Survivor Annuity, unless the former Participant has elected otherwise
during the election period. For this purpose, the election period must begin at
least six months before the participant attains qualified early retirement age
and end not more than 90 days before the commencement of benefit distributions.
Any election hereunder must be in writing and delivered to the Administrator;
such election may be changed by the former Participant at any time by delivery
of written notification of such change and/or a separate written election to the
Administrator.
(b) A former Participant who is employed at the start of the election
period defined below will be given the opportunity to elect, during such
election period, to have a survivor annuity payable on death. If the former
Participant elects the survivor annuity, payments under such annuity must not be
less than the payments which would have been made to the Spouse under the
Qualified Joint and Survivor Annuity if the former Participant had retired on
the day before his or her death. Any election under this provision must be in
writing and delivered to the Administrator; such election may be changed by the
former Participant at any time by delivery of written notification of such
change and/or a separate written election to the Administrator. The election
period begins on the later of (i) the 90th day before the former Participant
attains the qualified early retirement age or (ii) the date the former
Participant terminates employment with the Employer.
(c) The qualified early retirement age referred to in this Section
22.04 shall mean the latest of:
(i) the earliest date, under the plan, on which the former
Participant may elect to receive retirement benefits,
(ii) the first day of the 120th month beginning before the
former Participant reaches Normal Retirement Age, or
(iii) the date the former Participant began participation.
SECTION 23.
DISTRIBUTION OPTION
NOTICE REQUIREMENTS
23.01 Notice of Waivability of Qualified Preretirement Survivor Annuity.
In the case of a Participant who is scheduled to receive Qualified Preretirement
Survivor Annuity pursuant to section 8.01 hereof, the Administrator shall
provide the Participant within the period beginning on the first day of the Plan
Year in which the Participant attains age 32 and ending with the close of the
Plan Year in which the Participant attains age 35, a written explanation of: (a)
the terms and conditions of a Qualified Preretirement Survivor Annuity; (b) the
Participant's right to make, and the effect of, an election to waive Qualified
Preretirement Survivor Annuity coverage; (c) the rights of a Participant's
Spouse; and (d) the Participant's right to make, and the effect of, a revocation
of a previous election to waive Qualified Preretirement Survivor Annuity
coverage. In the case of a Participant who becomes a Participant after the
first day of the Plan Year in which the Participant attained age 32 and who is
scheduled to receive a Qualified Preretirement Survivor Annuity pursuant to
Section 8.01 hereof, the Administrator shall provide the notice required by this
Section 23.01 no later than the close of the third Plan Year subsequent to the
Participant's commencement of participation in the Plan.
23.02 Notice of Waivability of Qualified Joint and Survivor Annuity. In
the case of a Participant who is scheduled to receive a Qualified Joint and
Survivor Annuity pursuant to the provisions of Section 9.03 hereof, the
Administrator shall provide to the Participant, within a reasonable period prior
to the commencement of distributions, a written explanation of: (a) the terms
and conditions of a Qualified Joint and Survivor Annuity; (b) the Participant's
right to make, and the effect of, an election to waive distribution in the form
of a Qualified and Joint Survivor Annuity coverage; (c) the rights of the
Participant's Spouse; and (d) the Participant's right to make, and the effect
of, a revocation of a previous election to waive distribution in the form of the
Qualified and Joint Survivor Annuity.
SECTION 24.
WAIVER OF MINIMUM FUNDING STANDARD
If an Employer who has adopted this Prototype Plan as a money purchase
pension plan is unable to satisfy the minimum funding standard (as described in
Code Section 412) for a given Plan Year, it may apply to the Internal Revenue
Service for a waiver of such minimum funding standard. If the waiver is
granted, the following provisions apply:
(a) An adjusted Account balance shall be maintained for each
Participant whose actual Account balance is less than or equal to his or her
adjusted Account balance.
(i) For the Plan Year for which the first waiver is granted, the
adjusted Account balance as of the Valuation Date for each affected Participant
equals:
(A) the Participant's actual Account balance, plus
(B) the amount that such Participant would have received if
the amount waived had been contributed.
(ii) For each Plan Year following the Plan Year for which a
waiver is granted, the adjusted Account balance for each Participant affected by
such waiver (calculated as of the Valuation Date for that Plan Year) equals:
(A) the adjusted Account balance as of the Valuation Date
in the prior Plan Year, plus
(B) the amount equal to the actual investment return
credited or charged to the Participant's actual Account balance, plus
(C) the amount equal to 5% of the excess of the amount in
(A) over the Participant's actual Account balance calculated as of the same
date, plus
(D) the amount equal to such Participant's allocated share
of the required Employer Contribution (whether or not waived) for the Plan Year
(determined without regard to adjusted waiver payments and discretionary
Employer Contributions), minus
(E) the amount of the Participant's adjusted Account
balance forfeited during the Plan Year under the Plan's provisions.
(b) For a given Plan Year, the Employer is required to contribute a
certain amount in order to satisfy the minimum funding standard for such Plan
Year. For each Plan Year which follows a Plan Year for which a waiver of the
minimum funding standard was granted the amount equals:
(i) the amount due as determined under Section 4.01(b) above
without regard to this Section), plus
(ii) the adjusted waiver amount.
(c) The adjusted waiver amount for a given Plan Year equals:
(i) the sum of the amounts necessary to amortize each waived
funding deficiency over a period of fifteen Plan Years (measured from the
Valuation Date of the Plan Year for which the corresponding waiver was granted)
at 5% interest, compounded annually, minus
(ii) the sum of the amounts necessary to amortize the total of
each Plan Year's forfeitures (which have arisen since the first waiver was
granted) over a period of fifteen Plan Years (measured from the Valuation Date
of the Plan Year in which the corresponding forfeitures arose) at 5% interest,
compounded annually.
(d) An amount equal to the adjusted waiver amount must be contributed
only until each Participant's actual Account balance equals the Participant's
adjusted Account balance.
(e) Any Plan provision which provides that Employer Contributions
shall be reduced immediately by forfeitures is revoked until each Participant's
actual Account balance equals that Participant's adjusted Account balance.
(f) Discretionary Employer Contributions, which are in addition to
the amounts contributed to satisfy the minimum funding standard, can be made in
any given Plan Year. However, the total Employer Contribution for the Plan Year
cannot exceed the then remaining underfunded amount (the sum of Participants'
adjusted Account balances minus total Plan assets).
(g) The adjusted waiver payments, discretionary Employer
contributions and the forfeitures of actual Account balances for the current
Plan Year shall be allocated as of that Plan Year's Valuation Date to the actual
Account balances of the affected Participants.
(h) Each time a waiver is granted, an original waiver amount ("OWA")
will be determined for each affected Participant. The OWA equals the
Participant's portion of the amount which was waived.
(i) Commencing with the Valuation Date of the Plan Year for which a
waiver is granted, a remaining original waiver amount ("ROWA") must be
calculated for each affected Participant. As of such Valuation Date the OWA
equals the ROWA. On the Valuation Date of a succeeding Plan Year the ROWA
equals the prior Plan Year's ROWA multiplied by
<PAGE>
1.05, minus the forfeiture of amounts in the prior Plan year's ROWA incurred in
the current Plan Year. For each waiver that is granted one OWA and a
corresponding ROWA will be established for each affected Participant.
(j) The sum of the adjusted waiver payments, discretionary Employer
Contributions and forfeitures of actual Account balances for a given Plan Year
are allocated to those Participants who have ROWAs by multiplying the sum of
these three amounts by the fraction:
(i) the numerator of which equals the sum of OWAs for a
particular Participant, and
(ii) the denominator of which equals the sum of the OWAs for all
Participants.
To determine the portion of this allocation which is to be assigned to a
given ROWA, multiply the allocation by the corresponding OWA, then divide by the
sum of the OWAs for the particular Participant.
(k) If the calculation of a ROWA results in a value which is less
than zero, then
(i) the ROWA is set equal to zero,
(ii) the corresponding OWA is set equal to zero, and
(iii) the excess payments will be reallocated to the remaining
ROWAs.
(l) A distribution is determined by multiplying a Participant's
vested percentage by his or her adjusted Account balance. However,
distributions from the Plan may not exceed a Participant's actual Account
balance. If so limited, plan Participants shall receive subsequent
distributions derived from future adjusted waiver payments.
SECTION 25.
MISCELLANEOUS
25.01 Misrepresentation. Notwithstanding any other provision herein, if
an Employee misrepresents his or her age or any other fact, any benefit payable
hereunder shall be the smaller of: (a) the amount that would be payable if
no facts had been misrepresented, or (b) the amount that would be payable if the
facts were as misrepresented.
25.02 Legal or Equitable Action. If any legal or equitable action with
respect to the Plan is brought by or maintained against any person, and the
results of such action are adverse to that person, attorney's fees and all other
costs to the Employer, the Administrator or the Trust of defending or bringing
such action shall be charged against the interest, if any, of such person under
the Plan.
25.03 No Enlargement of Plan Rights. It is a condition of the Plan, and
each Participant by participating herein expressly agrees, that he or she shall
look solely to the assets of the Trust for the payment of any benefit under the
Plan.
25.04 No Enlargement of Employment Rights. Nothing appearing in or done
pursuant to the Plan shall be construed (a) to give any person a legal or
equitable right or interest in the assets of the Trust or distribution
therefrom, nor against the Employer, except as expressly provide herein or (b)
to create or modify any contract of employment between the Employer and any
Employee or obligate the Employer to continue the services of any Employee.
25.05 Written Orders. In taking or omitting to take any action under this
Plan, the Trustee may conclusively rely upon and shall be protected in acting
upon any written orders from or determinations by the Employer or the
Administrator as appropriate, or upon any other notices, requests, consents,
certificates or other instruments or papers believed by it to be genuine and to
have been properly executed, and so long as it acts in good faith, in taking or
omitting to take any other action.
25.06 No Release from Liability. Nothing in the Plan shall relieve any
person from liability for any responsibility under Part 4 of Title I of the Act.
Subject thereto, neither Trustee, Loan Trustee, Administrator nor Distributor
nor any other person shall have any liability under the Plan, except as a result
of negligence or wilful misconduct, and in any event the Employer shall fully
indemnify and save harmless all persons from any liability except that resulting
from their negligence or wilful misconduct.
25.07 Discretionary Actions. Any discretionary action, including the
granting of a loan pursuant to Section 10 hereof, to be taken by the Employer or
the Administrator under this Plan shall be non-discriminatory in nature and all
Employees similarly situated shall be treated in a uniform manner.
25.08 Headings. Headings herein are primarily for convenience of
reference, and if they conflict with the text, the text shall control.
25.09 Applicable law. This Plan shall, to the extent state law is
applicable, be construed and enforced in accordance with, and the rights of the
parties shall be governed by, the laws of the state in which (a) if the Trustee
is a corporation, the Trustee has its principal place of business; (b) if the
Trustee is an individual, the Trustee resides; or (c) if the Trustee is
individuals, where a majority of the individuals serving as Trustee reside. The
Employer's execution of the Adoption Agreement may be acknowledged where
required by applicable law.
25.10 No Reversion. Notwithstanding any other contrary provision of the
Plan, but subject nevertheless to Sections 5 and 16, no part of the assets in
the Trust shall revert to the Employer, and no part of such assets, other than
that amount required to pay taxes or administrative expenses, shall be used for
any purpose other than exclusive benefit of Employees or their Beneficiaries.
However, the Employer may request a return, and this Section 25.10 shall not
prohibit return, of an amount to the Employer under any of the following
circumstances:
(a) if the amount was all or part of an Employer contribution which
was made as a result of a mistake of fact and the amount contributed is returned
to the Employer within one year after the date on which the mistaken payment of
the contribution was made, or
(b) if the amount was all or part of an Employer contribution which
was conditioned on deductibility under Code Section 404 and this condition is
not satisfied, and the amount is returned to the Employer within one after the
date on which the deduction is disallowed, or
(c) if the amount was all or part of an Employer contribution which
was conditioned on the initial qualification of the Plan under Code Section
401(a), this condition is not satisfied, and the amount is returned to the
Employer within one year after the date on which initial qualification is
denied, or
(d) if the amount was all or part of an Employer contribution which
was conditioned on the qualification of the Plan as amended under Code Section
401(a), this condition is not satisfied, the Plan amendment was submitted to the
Internal Revenue Service for qualification within one year after it was adopted,
and the amount is returned to the Employer within one year after the date on
which requalification is denied.
For the purposes of this Section 25.10, all Employer contributions are
conditioned on initial qualification of the Plan under Code Section 401(a),
qualification of the Plan as amended under Code Section 401(a), and
deductibility under Code Section 404.
25.11 Notices. The Employer will provide the notice to other interested
parties contemplated under Code Section 7476 before requesting a determination
by the Secretary of the Treasury or his or her delegate with respect to the
qualification of the Plan.
25.12 Conflict. In the event of any conflict between the provisions of
this Plan and the terms of any contract or agreement issued thereunder or with
respect thereto, the provisions of the Plan shall control. In particular, the
proceeds of any life insurance contract purchased by the Trustee and not
governed by an effective Designation of Beneficiary form shall be paid to the
Participant's Spouse regardless of who is named as the beneficiary or
beneficiaries in the contract.
<PAGE>
SCUDDER FLEXI-PLAN AMENDMENT
FOR TAX REFORM ACT OF 1986
MODEL AMENDMENT II FOR DEFINED CONTRIBUTION PLANS
SECTION I: PURPOSE AND EFFECTIVE DATE
1.1. Purpose. The purpose of this amendment is to amend the plan to comply
with those provisions of the Tax Reform Act of 1986 that are effective prior to
the first year beginning after December 31, 1988. Nothing contained in this
amendment shall permit or require Matching Employer Contributions or Employee
Contributions under the plan unless such Matching Employer contributions or
Employee Contributions have been authorized by the employer under other
provisions of the plan or under other amendments thereto.
1.2. Effective Date. Except as otherwise provided, this amendment shall be
effective as of the first day of the first Plan Year beginning after December
31, 1986.
SECTION II: DEFINITIONS
For the purposes of this amendment only, the following definitions shall
apply:
2.1. "Adoption Agreement Amendment" shall mean that portion of this
amendment in which the employer makes any elections permitted under the
amendment.
2.2. "Affiliated Employer" shall mean any corporation which is a member of
a controlled group of corporations (as defined in section 414(b) of the Code)
which includes the employer, any trade or business (whether or not incorporated)
which is under common control (as defined in section 414(c) of the Code) with
the employer; any organization (whether or not incorporated) which is a member
of an affiliated service group (as defined in section 414(m) of the Code) which
includes the employer; and any other entity required to be aggregated with the
employer pursuant to regulations under section 414(o) of the Code.
2.3. "Code" shall mean the Internal Revenue Code of 1986 and amendments
thereto.
2.4. "Compensation" shall mean, for purposes of section V of this
amendment, compensation paid by the Employer to the Participant during the Plan
Year which is required to be reported as wages on the Participant's Form W-2 or
which, in the case of a self-employed individual, constitutes payment for
services rendered includible in the self-employed individual's gross income and,
if the provisions of the plan other than this amendment so provide, shall also
include compensation which is not currently includible in the Participant's
gross income by reason of the application of sections 125, 402(a)(8),
402(h)(1)(B), or 403(b) of the Code.
2.5. "Employee" shall mean employees of the Employer and shall include
leased employees within the meaning of section 414(n) (2) of the Code.
Notwithstanding the foregoing, if such leased employees constitute less than
twenty percent of the employer's nonhighly compensated workforce within the
meaning of section 414(n)(5)(C)(ii) of the Code, the term "Employee" shall
<PAGE>
[PLEASE NOTE PREVIOUS PAGE ENDS WITH SECTION 2.5 CURRENT PAGE BEGINS WITH 4.1]
aggregate contributions as defined in section 401(m)(6)(B), and excess
deferrals as described in section 402(g), regardless of whether such
amounts are distributed or forfeited;
(ii) Forfeitures; and
(iii) Amounts described in sections 415(l)(1) and 419A(d)(2) of the Code.
4.1(b). Maximum Annual Addition. The maximum Annual Addition that may be
contributed or allocated to a Participant's account under the plan for any
Limitation Year shall not exceed the lesser of:
(i) the Defined Contribution Dollar Limitation, or
(ii) 25 percent of the Participant's compensation, within the meaning of
section 415(c)(3) of the Code for the Limitation Year.
4.1(c). Special Rules. The compensation limitation referred to in section
4.1(b)(ii) shall not apply to:
(i) Any contribution for medical benefits (within the meaning of section
419A(f)(2) of the Code) after separation from service which is otherwise
treated as an Annual Addition, or
(ii) Any amount otherwise treated as an Annual Addition under section
415(l)(1) of the Code.
4.1(d). Definitions. For purposes of section 4.1, "Defined Contribution
Dollar Limitation" shall mean $30,000 or, if greater, one-fourth of the defined
benefit dollar limitation set forth in section 415(b)(1) of the Code as in
effect for the Limitation Year.
4.2. Special Rules for Plans Subject to Overall Limitations Under Code
Section 415(e).
4.2(a). Recomputation Not Required. The Annual Addition for any Limitation
Year beginning before January 1, 1987 shall not be recomputed to treat all
Employee Contributions as an Annual Addition.
4.2(b). Adjustment of Defined Contribution Plan Enrollment. If the plan
satisfied the applicable requirements of section 415 of the Code as in effect
for all Limitation Years beginning before January 1, 1987, an amount shall be
subtracted from the numerator of the defined contribution plan fraction (not
exceeding such numerator) as prescribed by the Secretary of the Treasury so that
the sum of the defined benefit plan fraction and defined contribution plan
fraction computed under section 415(e)(1) of the Code (as revised by this
section IV) does not exceed 1.0 for such Limitation Year.
4.3. Limitation Year. For purposes of this section IV, "Limitation Year"
shall mean the limitation year specified in the plan, or if none is specified,
the calendar year.
4.4. Effective Date of Section IV Provisions. The provisions of this
section IV shall be effective for Limitation Years beginning after December 31,
1986.
4.5. For purposes of this section IV, Affiliated Employer shall also
include those employers described in section 415(h) of the Code.
<PAGE>
[PLEASE NOTE PREVIOUS PAGE ENDS WITH SECTION 4.5 CURRENT PAGE BEGINS WITH 5.4]
such plans were a single plan.
5.4(c). For purposes of determining the Contribution Percentage of an
Eligible Participant who is a Highly Compensated Employee, the Employee
Contributions, Matching Contributions and Compensation of such Eligible
Participant shall include the Employee Contributions, Matching Contributions and
Compensation of Family Members. Family Members with respect to Highly
Compensated Employees shall be disregarded as separate employees in determining
the Contribution Percentage both for Eligible Participants who are Nonhighly
Compensated Employees and both for Eligible Participants who are Highly
Compensated Employees.
5.4(d). The determination and treatment of the Contribution Percentage of
any Eligible Participant shall satisfy such other requirements as my be
prescribed by the Secretary of the Treasury.
5.5. Distribution of Excess Aggregate Contributions.
5.5(a). In General. Excess Aggregate Contributions plus any income and
minus any loss allocable thereto shall be forfeited, if otherwise forfeitable
under the terms of this plan, or if not forfeitable, distributed no later than
the last day of each Plan Year beginning after December 31, 1987, to
Participants to those accounts Employee Contributions or Matching Contributions
were allocated for the preceding Plan Year.(1) Excess Aggregate Contributions
shall be treated as Annual Additions under section 4.1(a) of this Amendment.
5.5(b). Excess Aggregate Contribution. For purposes of this amendment,
"Excess Aggregate Contributions" shall mean the amount described in section
401(m)(6)(B) of the Code.
5.5(c). Determination of Income or Loss. The Excess Aggregate Contributions
to be forfeited, if otherwise forfeitable under the terms of the plan, or if not
forfeitable, distributed to the Participant shall be adjusted for income or
loss. The income or loss allocable to Excess Aggregate Contributions shall be
determined by multiplying the income or loss allocable to the Participant's
Employee Contributions and Matching Contributions for the Plan Year by a
fraction, the numerator of which is the Excess Aggregate Contributions on behalf
of the Participant for the preceding Plan Year and the denominator of which is
the sum of the Participant's account balances attributable to Employee
Contributions and Matching Contributions on the last day of the preceding Plan
Year.
5.5(d). Accounting for Excess Aggregate Contributions. Excess Aggregate
Contributions shall be distributed from the Participant's Employee Contribution
account, and forfeited if otherwise forfeitable under the terms of the plan (or,
if not forfeitable, distributed) from the Participant's Matching Contribution
account in proportion to the Participant's Employee Contributions and Matching
Contributions for the Plan Year.
- ----------------------
(1)If Excess Aggregate Contributions plus any income and minus any loss
allocable thereto are forfeited (if forfeitable) or distributed more than 2 1/2
months after the last day of the Plan Year in which such Excess Aggregate
Contrbutions arose, then section 4979 of the Code imposes a ten (10) percent
excise tax on the employer maintaining the plan with respect to such accounts.
<PAGE>
[PLEASE NOTE PREVIOUS PAGE ENDS WITH SECTION 5.5 CURRENT PAGE BEGINS WITH 10.1]
would have been applied, if forfeited, to reduce employer contributions under
the plan.
SECTION X: PROFITS NOT REQUIRED
10.1. Applicability of this Section. This section X shall apply to the plan
only if such plan is a profit-sharing plan and the employer elects in the
Adoption Agreement to have this section apply.
10.2. Employer Contributions. Notwithstanding any other provision of the
plan, employer contributions for Plan Years specified in the Adoption Agreement
Amendment shall be made to the plan without regard to current or accumulated
earnings and profits for the taxable years or years ending with or within in
Plan Year. The plan shall continue to be designated to qualify as a
profit-sharing plan for purposes of section 401(a), 402, 412, and 417 of the
Code.
<PAGE>
THESE SECTIONS ARE TO REPLACE THE CORRESPONDING
SECTIONS OF THE SCUDDER FLEXI-PLAN DOCUMENT
SECTION 15.
DESIGNATION OF BENEFICIARY
Each participant and beneficiary may submit to the Trustee a properly
executed Designation of Beneficiary form. In order to be effective, such
designation (a) must have been properly executed and submitted to the Trustee
before the death of the Participant or beneficiary, as the case my be, and (b)
except in the case of the portion of a Participant's vested Account balance in a
money purchase pension plan which is not available for distribution in the form
of a Qualified Preretirement Survivor Annuity pursuant to Section 8.01 above,
for Participants who die after August 22, 1984 leaving a surviving Spouse, must
be accompanied, or preceded, by a consent of the Participant's Spouse (unless
said Spouse is designated as the sole, primary Beneficiary). Such consent of the
Spouse must be in writing, acknowledge that the effect of such consent is that
the Spouse may receive no benefits under the Plan, be witnessed by a Plan
representative or a notary public, and be limited consent to the payment of
death benefits to a specific person or persons. The last effective Designation
accepted by the Trustee shall be controlling, and whether or not fully
dispositive of the Participant's Account, thereupon shall revoke all
Designations (and related spousal consents) previously submitted by the
Participant or beneficiary, as the case may be. Each such executed Designation
(and related spousal consent) is hereby specifically incorporated herein by
reference and shall be construed and enforced in accordance with the laws of the
state in which the Trustee has its principal place of business.
SECTION 22.
SPECIAL DISTRIBUTION RULES
22.01 Special Rule for Profit Sharing Plan Participants. If this Plan is
adopted as a profit sharing plan and (a) it is determined that this Plan is a
direct or indirect transferee (including a plan which is amended into this Plan)
of a defined benefit plan, money purchase pension plan (including a target
benefit plan), stock bonus or profit sharing plan which would otherwise provide
a life annuity form of payment with respect to such Participant, (b) the Plan is
amended so as to allow a Participant to elect to receive his or her benefits in
the form of a life annuity and a Participant elects to receive his or her
benefits in such form, (c) the Plan is amended to provide that absent a
Qualified Election of a Participant's surviving spouse, someone other than the
Participant's surviving spouse becomes entitled to the Participant's vested
Account balance, or (d) if someone other than the Participant's surviving Spouse
is the beneficiary of any insurance purchased with funds from the Participant's
Account, the provisions of Section 8, 9 and 15 shall apply as if this Plan were
adopted as a money Purchase pension plan.
<PAGE>
SCUDDER FLEXI-PLAN
ENROLLMENT BOOKLET
=======================================================
- -------------------------=======================================================
Adoption Agreements
- -------------------------=======================================================
Contribution Forms
- -------------------------=======================================================
Transfer Forms
- -------------------------=======================================================
Designation of Beneficiary Forms
- -------------------------=======================================================
Notice to Interested Parties
SCUDDER
SERVING INVESTORS SINCE 1919
- -------------------------=======================================================
<PAGE>
- --------------------------------------------------------------------------------
HOW TO START
YOUR FLEXI-PLAN
================================================================================
Everything you need is right in this booklet. After reading all of the enclosed
material, just follow these simple steps:
- --------------------------------------------------------------------------------
1 Fill out the appropriate Adoption Agreements. You can choose the profit
sharing plan, the pension plan, or both. Build a customized retirement plan
by selecting the appropriate features.
- --------------------------------------------------------------------------------
2 Complete a Transfer Form if you are transferring assets from an existing plan
to Scudder.
- --------------------------------------------------------------------------------
3 Choose the fund or funds you and any participants would like to invest in and
complete the appropriate Contribution Form. Be sure that you and any
participants read the prospectus of the fund(s) selected.
- --------------------------------------------------------------------------------
4 Have your plan's participants fill out a Designation of Beneficiary for each
plan you adopt. If necessary, you can make copies of these forms for
additional participants.
- --------------------------------------------------------------------------------
5 Make copies of all the forms for your records
- --------------------------------------------------------------------------------
6 Send these forms with your check payable to State Street Bank and Trust Co.
in the reply envelope provided.
- --------------------------------------------------------------------------------
7 Post the "Notice to Interested Parties" for your employees.
- --------------------------------------------------------------------------------
If you have any questions or would like assistance in filling out these forms,
please call our Retirement Plan Specialists at 1-800-323-6105
They'll be happy to help you.
THIS BOOKLET CONTAINS:
================================================================================
Adoption Agreements
o A Flexi-Profit Sharing Plan Adoption Agreement. Complete this application to
establish a profit sharing plan.
o A Flexi-Money Purchase Pension Plan Adoption Agreement. Complete this
application to establish a pension plan.
- --------------------------------------------------------------------------------
Plan Contribution Forms
o A Flexi-Profit Sharing Plan Contribution Form. Use this form to tell us how to
divide and invest any contribution to the profit sharing plan.
o A Flexi-Money Purchase Pension Plan Contribution Form. Use this form to tell
us how to divide and invest any contribution to the pension plan.
- --------------------------------------------------------------------------------
Transfer Forms
o A Flexi-Profit Sharing Plan Transfer Form. Fill out this form to
move the assets of an existing profit sharing plan to Scudder.
o A Flexi-Money Purchase Pension Plan Transfer Form. Fill out this form to move
the assets of an existing pension plan to Scudder.
- --------------------------------------------------------------------------------
Designation of Beneficiary Forms
o A Flexi-Profit Sharing Plan Designation of Beneficiary. Each participant in
the profit sharing plan should complete one to name a beneficiary for his or her
vested balance.
o A Flexi-Money Purchase Pension Plan Designation of Beneficiary. Each
participant in the pension plan should complete one to name a beneficiary for
his or her vested balance.
- --------------------------------------------------------------------------------
Notice to Interested Parties
o Please post this notice for your employees in a common area of your workplace.
See instructions for posting at the top of the form.
<PAGE>
- --------------------------------------------------------------------------------
SCUDDER FLEXI-PLAN
==================
Profit Sharing Plan
Adoption Agreement
Return this form to:
Scudder Fund Distributors, Inc.
Retirement Plan Services
P.O. Box 9047
Plan number 003 Boston, MA 02205-9047
- --------------------------------------------------------------------------------
INSTRUCTIONS:
These instructions are provided to help you make selections in the
corresponding sections of the Profit Sharing Plan Adoption Agreement. The
Adoption Agreement is designed with "pre-selected" options shaded in each
section. If you want the pre-selected option, please do not check or complete
the unshaded option below it. If you prefer the unshaded option, check the box
and fill in any blanks.
1. ELIGIBILITY
This section determines who will be covered by the plan. You determine the
waiting period, how many hours constitute a year of service, minimum age
required, and starting day for participation. You also decide whether you wish
to exclude certain classes of employees from participation in the plan. If this
is your first year of business, you must reduce the waiting period to make
contributions for this year.
2. VESTING OF EMPLOYER CONTRIBUTIONS
A. If you choose a waiting period of more than one year in 1.A., you must select
full and immediate vesting. If you choose a waiting period of one year or
less and want graduated vesting, check the unshaded option to select the
vesting schedule in Column 1. For a more rapid schedule, check the box and
complete Column 2.
B. If you choose immediate vesting, skip this section. If you choose graduated
vesting, you may select the 12 month period on which vesting years are
calculated. If you check the unshaded option, you may not check the box in
2.C., the following section.
C. Do not check the unshaded option if you checked the box in 2.B. If you did
not check the box in 2.B. and want participants to accrue a vesting year for
years they receive an employer contribution, whether or not the participant
completes the number of Hours of Service specified in Section 1.B., check the
box in 2.C.
D. Checking a box(es) in this section allows you to calculate vesting years
including a participant's service before the plan (or predecessor plan) was
established or before the plan year in which a participant turned 18.
3. ALLOCATION OF EMPLOYER CONTRIBUTIONS
A. This option allows you to decide whether you will make contributions for
former participants who retired or otherwise terminated participation in the
plan during the plan year. If you do not wish to make contributions for these
former participants, check the unshaded option.
B. If your plan is top heavy, you may be required to make minimum contributions
for non-key employees. If you maintain more than one qualified retirement
plan, this election lets you select the plan responsible for making these
minimum contributions.
Check and complete the unshaded option if you want to make any minimum plan
contributions from another tax qualified plan or from the Scudder Pension
Plan if you have adopted both the Scudder Profit Sharing and Pension Plans.
Do not check the unshaded option if you are adopting only the Profit Sharing
plan.
4. INTEGRATION WITH SOCIAL SECURITY
If you do not want your plan integrated with Social Security, skip this section.
If you do wish to integrate the plan, check the unshaded option and make the
selection in 4.A. for the wage level to which you want integration to apply and
in 4.B. for the rate of integration (check and complete the desired options).
5. NORMAL RETIREMENT DATE
The normal retirement date for plan participants will be 59-1/2 unless you check
and complete the unshaded option.
6. COMPENSATION
The unshaded option in this section allows you to base contributions on
compensation for the entire year an employee becomes a participant, even if the
employee becomes a participant during the year.
7. PARTICIPANT CONTRIBUTIONS
Non-deductible voluntary contributions (after-tax) are allowed by the plan
unless you select otherwise by checking the unshaded option.
8. INVESTMENT
Plan participants will have discretion over the investment of plan contributions
made for them unless the unshaded option is checked.
9. LOANS
Loans to participants from this plan are not permitted unless you check the
unshaded option. NOTE: Certain owners, including owner-employees, are prohibited
from taking loans from the plan.
10. EFFECTIVE DATE
The effective date of the plan will be the first day of the employer's fiscal
year, unless otherwise indicated by checking and completing the unshaded option.
11. PLAN YEAR
The plan year will be the employer's fiscal year unless you check and complete
the unshaded option.
12. AMENDMENT
If you are adopting the Profit Sharing Plan as an amendment to an existing plan,
please check the unshaded option.
13. LIMITATIONS ON ALLOCATIONS
This section advises you concerning the limitations on allocations of
contributions if you have other tax-qualified plans in addition to the
Flexi-Plan Profit Sharing Plan or Money Purchase Pension Plan.
14. LIMITATION YEAR
The limitation year will be the same as the plan year unless you check and
complete the unshaded option.
15. SIGNATURES
Please read and complete this section. State Street Bank and Trust Company is
predesignated as the Plan's trustee and the Adoption Agreement is presigned by
an authorized representative of State Street Bank.
If you elect to allow loans to participants in this Agreement, please designate
a loan trustee and obtain the loan trustee's signature. The loan trustee may be
an individual.
Please provide all the information requested, including the employer's tax
identification number and fiscal year. If you do not have a tax identification
number, please contact your local Internal Revenue Service office to obtain a
number.
ADOPTION AGREEMENT AMENDMENT
As permitted under the Tax Reform Act of 1986, an employer need not have profits
in a plan year in order to make employer contributions. Check the box is you
want this provision to apply to your plan.
If you have any questions about this Adoption Agreement, please call a Scudder
Retirement Plan Specialist at 1-800-323-6105.
<PAGE>
- --------------------------------------------------------------------------------
SCUDDER FLEXI-PLAN
Profit Sharing Plan
Adoption Agreement
Return this form to:
Scudder Fund Distributors, Inc.
Retirement Plan Services
P.O. Box 9047
Plan number 003 Boston, MA 02205-9047
- --------------------------------------------------------------------------------
The undersigned (the "Employer") establishes, or amends, the (Scudder
automatically inserts employer's name) Profit Sharing Plan, by completing this
Adoption Agreement adopting or amending the Profit Sharing Plan in the form of
the Prototype Plan attached.
1. ELIGIBILITY
A. To become a Participant an Employee must complete 3 Years of Service
|_| or, if this box is checked, an Employee must complete ____ Year(s) of
Service, (insert less than "3"; select more than "1" only if the
employer selects full and immediate vesting in Section 2.A. below;
insert "0" for no waiting period).
B. The number of Hours of Service required to have a Year of Service is 1000
|_| or, if this box is checked, ____ (insert less than 1000 hours). However,
if the Year(s) of Service selected in A. above is or includes a
fractional year, an Employee is not required to complete any specified
number of Hours of Service to receive eligibility credit for such
fractional year.
C. To become a Participant an Employee need not attain any minimum age
|_| or, if this box is checked. a employee must be at least ____ (insert 21
or less) years of age.
D. An Employee who meets the above requirements shall become a Participant on
the first day the requirements are met
|_| or, if this box is checked, on the first day of the next month.
E. All Employees are entitled to be Participants
|_| or, if this box is checked, all Employees are entitled to be
Participants except (check one or both):
|_| Non-resident aliens who receive no earned income from the Employer which
constitutes income from sources within the United States
|_| Individuals covered by a collective bargaining contract which meets the
requirements specified in the Plan.
2. VESTING OF EMPLOYER CONTRIBUTIONS
A. Employer Contributions under the Plan shall be fully and immediately vested
and non-forfeitable
|_| or, if this box is checked, vested at the rate in Column 1 below, or at
a more rapid rate of vesting if specified in Column 2 below.
VESTING TABLE
Column 1 Column 2
-------- --------
Vesting Minimum Percentage
Years Percentage Selected
1 0 _________
2 20 _________
3 40 _________
4 60 _________
5 80 _________
6 100 _________
B. Vesting Years and One-Year Breaks in Service for the purpose of vesting
shall be measured on the Plan Year
|_| or, if this box is checked, on the 12 consecutive month period beginning
on the Participant's initial date of employment or an anniversery of
that date.
Note: If you make this election, you may not check the box in Section
2.C. below.
C. The Participant will have a Vesting Year only if the Participant completes
the number of Hours of Service specified in Section 1.B.
|_| or, if this box is checked, if the Participant either completes the
number of Hours of Service specified in Section 1.B. or receives an
allocation of the Employer Contribution for the Plan Year, or both.
D. The following Service will be included in determining Vesting Years only if
checked below:
|_| Service before the Employer maintained this Plan or a predecessor plan
|_| Service before the first Plan Year in which a Participant attained age
18.
<PAGE>
3. ALLOCATION OF EMPLOYER CONTRIBUTIONS
A. A former Participant who has retired, died, otherwise terminated Service, or
transferred to an ineligible class of Employee during the Plan Year shall
share in the allocation of Employee Contributions for the Plan Year
|_| or, if this box is checked, shall not share in the allocation of
Employer Contributions.
B. Any required minimum top heavy allocations will be made first from this Plan
|_| or, if this box is checked, first from the ____________________________
Plan (insert name of another qualified plan maintained by the Employer)
4. INTEGRATION WITH SOCIAL SECURITY
The Plan will not be integrated with Social Security
|_| or, if this box is checked, will be integrated with Social Security on
the following basis:
A. The Integration Level for a Plan Year will be the Social Security Wage
Base for such Plan Year
|_| or, if this box is checked, $_________________ (not to exceed the
Social Security Wage Base)
B. The Integration Rate for a Plan Year will be the OASDI Rate for each
Plan Year
|_| or, if this box is checked, ____________________% (not in excess of
OASDI Rate)
Note: An Employer may elect to integrate the Plan with Social Security only
if the Employer does not maintain another qualified retirement plan
integrated with Social Security.
5. NORMAL RETIREMENT DATE
A Participant's Normal Retirement Date shall be age 59-1/2
|_| or, if this box is checked, age ________________ (insert more than
59-1/2 but not more than 65).
6. COMPENSATION
"Compensation" shall only include amounts paid during the Plan Year by the
Employer to the Employee while the Employee was a Participant
|_| or, if this box is checked, "Compensation" shall include amounts paid by
the Employer to the Employee during the entire Plan Year in which an
Employee became a Participant whether or not such Employee was a
Participant for the entire Plan Year.
7. PARTICIPANT CONTRIBUTIONS
Non-deductible Voluntary contributions by a Participant are permitted
|_| or, if this box is checked, are not permitted.
8. INVESTMENT
Investment decisions shall be made by the Participant
|_| or, if this box is checked, by the Administrator.
9. LOANS
Loans to a Participant are not permitted
|_| or, if this box is checked, are permitted.
10. EFFECTIVE DATE
The Effective Date of the Adoption Amendment shall be the first day of the
Employee's fiscal year during which the Plan is adopted or amended
|_| or, if this box is checked, ____________________ (insert date).
11. PLAN YEAR
The Plan Year shall be the same as the fiscal year of the Employee
|_| or, if this box is checked, shall end on the last day of the month of
________________.
12. AMENDMENT
Execution of the Adoption Agreement is not an amendment to an existing plan
|_| or, if this box is checked, is an amendment to an existing plan.
<PAGE>
13. LIMITATION ON ALLOCATIONS
If the Employer maintains or has even maintained another qualified defined
contribution plan other than a Scudder Money Purchase Pension Plan (Plan number
002 or 004) or a plan amended into the Prototype Plan in which any Participant
in the Plan is or was a participant or could possibly become a participant, the
provisions of Section 5.03 of the Prototype Plan will apply.
If the Employer maintains or has ever maintained a qualified defined benefit
plan in which any Participant in this Plan is or was a participant or could
possibly become a participant, the provisions of Section 5.04 of the Prototype
Plan will apply.
14. LIMITATION YEAR
The Limitation Year shall be identical for all plans maintained by the Employee
as the Plan Year.
|_| or, if this box is checked, shall end on the last day of the
month of ________________.
15. SIGNATURES
The Employer (1) covenants and agrees that whenever a Participant makes a
contribution the Employer shall ascertain the Participant has received a copy of
the current prospectus relating to the shares of any Designated Investment
Company in which such contribution is to be invested plus, where required by any
state or federal law, the current prospectus relating to any other investment in
which contributions are to be invested, and (2) by remitting such a contribution
to the Trustee the Employer shall be deemed to represent that the Employer has
received a current prospectus, and (3) by remitting any other contribution to
the Trustee the Employer shall be deemed to represent that the Employer has
received a current prospectus of any Designated Investment Company in which it
is to be invested, plus, where required by any state or federal law, the current
prospectus relating to any other investment in which contributions are to be
invested.
An Employer adopting this plan may rely on the opinion letter issued by the
National Office of the Internal Revenue Service as evidence that this Plan is
qualified under Section 401 of the Internal Revenue Code, provided that the
Employer has never maintained, is not maintaining, and will not (while
maintaining this Plan) adopt another qualified plan (other than the Scudder
Money Purchase Pension Plan (plan number 002 or 004) or a plan which is being
amended into this Plan or the Scudder Money Purchase Pension Plan (plan number
002 or 004)) or after December 31, 1985, a welfare benefit fund (as defined in
Code Section 419(e)) which provides post-retirement medical benefits allocated
to separate accounts for Key Employees (as defined in Code Section 419A(d)(3)).
An employer who adopts or maintain multiple plans other than the Scudder Profit
Sharing Plan (plan number 001 or 003) together with the Scudder Money Purchase
Pension Plan (plan number 002 or 004) may apply for a determination letter from
the appropriate Key District Director of the Internal Revenue to obtain reliance
that the plans are qualified.
This Adoption Agreement may be used only in conjunction with basic plan document
#01.
__________________________________
Name of Employer
__________________________________
Signature of Employer
__________________________________
Date
__________________________________
Street Address
__________________________________
City State Zip
__________________________________
Daytime Telephone
__________________________________
Employer Tax Identification Number
__________________________________
Employer Fiscal Year
__________________________________
Name of Loan Trustee*
__________________________________
Signature
*NOTE: If you elect to allow loans to Participants in Section 9, you must
designate a Loan Trustee.
Trustee:
State Street Bank and Trust Company
By: /s/ G. Reeves
ADOPTION AGREEMENT AMENDMENT
Employer Contributions in Profit Sharing Plan.
(check the option below if you wish it to apply to your plan)
|_| Effective for Plan Years beginning on or after ___________________
[fill in the first day of the Plan Year in which this Adoption Agreement
Amendment is executed or a subsequent anniversary of such date],
notwithstanding any other provision of the plan, the employer contributions
shall be made to the plan without regard to current or accumulated earnings and
profits for the taxable year or years ending with or within such Plan Year.
Please make copies of all completed forms for your records.
<PAGE>
To be Completed by Employer
- --------------------------------------------------------------------------------
SCUDDER FLEXI-PLAN
==================
Profit Sharing Plan
Contribution Form
Return this form to:
Scudder Fund Distributors, Inc.
Retirement Plan Services
P.O. Box 9047
Boston, MA 02205-9047
- --------------------------------------------------------------------------------
Employer Information
Name____________________________________ Tax I.D. #__________________
Business Address________________________ Telephone___________________
City________________________State________Zip Code____________________
- --------------------------------------------------------------------------------
Telephone Exchange Option
You or your plan participants will be able to exchange shares from one Scudder
Fund into any other Scudder Fund by telephone, telegram, or TWX. The new account
will have the identical registration as the account from which the shares are
transferred.
- --------------------------------------------------------------------------------
Participant Information
The minimum investment for the first Scudder plan you establish (either the
Profit Sharing Plan or the Pension Plan) is $500 times the number of
participants, which may be allocated in any amounts among the participants (e.g.
2 participants, minimum investment = $1000 which can be allocated $700 for one
and $300 for the other). If you are establishing both plans, the minimum
investment for the second plan is $300 times the number of participants.
Participants may invest in more than one Scudder Fund if at least $500 is
invested in each fund.
|_| Check here if assets to be invested in the Profit Sharing Plan will include
a transfer from an existing plan. Please also complete the enclosed
transfer form. (Please designate allocation of transfer money on the
transfer form, and not on this form.)
Scudder Fund(s) Contribution Amount
Selected Employer Employee Total
Participant_______________ _____________ $_______ $_______ $_____
Birth Date_______________ _____________ ________ ________ ______
Social Security #________ _____________ ________ ________ ______
Participant_______________ _____________ ________ ________ ______
Birth Date_______________ _____________ ________ ________ ______
Social Security #________ _____________ ________ ________ ______
Participant_______________ _____________ ________ ________ ______
Birth Date_______________ _____________ ________ ________ ______
Social Security #________ _____________ ________ ________ ______
(Please attach additional pages if necessary) Total investment $=====
Please make your contribution check payable to State Street Bank and Trust Co.
<PAGE>
- --------------------------------------------------------------------------------
SCUDDER FLEXI-PLAN
==================
Profit Sharing Plan
Transfer Form
Return this form to:
Scudder Fund Distributors, Inc.
Retirement Plan Services
P.O. Box 9047
Boston, MA 02205-9047
- --------------------------------------------------------------------------------
1. Name and Address of Employer
Name____________________________________ Tax I.D.# _________________
Business Address________________________ Telephone _________________
City______________________ State________ Zip Code __________________
2. Instructions to Present Trustee
Name of Trustee_____________________________________________________
Address_________________________________ Telephone _________________
City______________________ State________ Zip Code __________________
Present Account #'s _______________________________
_______________________________
_______________________________
I request that the Trustee of my present qualified retirement plan transfer
the assets of my profit sharing plan to State Street Bank and Trust
Company, which I have appointed as Trustee of my Scudder Flexi-Profit
Sharing Plan. All assets should be transferred as cash according to the
following instructions:
|_| Please transfer all of my present retirement plan assets and
resign as Trustee
or
|_| Please transfer $____ of my present retirement plan assets and
retain the balance.
Other instructions (e.g. make transfer upon maturity date of __/__/__): __
__________________________________________________________________________
- --------------------------------------------------------------------------------
Trustee should make check payable to:
State Street Bank and Trust Company A/C _________________ Scudder Flexi-
(employer name)
Profit Sharing Plan.
Return check in the enclosed envelope to Scudder Fund Distributors, Inc.,
Retirement Plan Services, P.O. Box 9047, Boston, MA 02205-9047.
- --------------------------------------------------------------------------------
3. Instructions to State Street Bank and Trust Company
Upon receipt of the assets from my previous profit sharing plan trustee,
please invest them in the Scudder Flexi-Profit Sharing Plan in the Scudder
funds as indicated below:
<TABLE>
<CAPTION>
Scudder Fund(s) Account# Employer Employee
Participant Selected (if existing) Contribution Contribution Total
- ------------- ------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
_____________ _____________ _____________ _____________ _____________ _____________
_____________ _____________ _____________ _____________ _____________ _____________
_____________ _____________ _____________ _____________ _____________ _____________
</TABLE>
(Please attach additional pages if necessary.)
- --------------------------------------------------------------------------------
4. Signature of Employer
__________________________ _______________________________________
Date Employer Signature
5. Acceptance by New Trustee (To be completed by Scudder Fund Distributors,
Inc. and State Street Bank and trust company)
State Street Bank and Trust Company accepts the appointment as successor trustee
of the above Profit Sharing Plan account and requests the liquidation and
transfer of assets as indicated above.
Scudder Fund Distributors, Inc. State Street Bank and Trust Company
By: __________________________
Date: ________________________ By: /s/ G. Reeves
--------------------------------
This form is valid only is signed by an authorized representative of Scudder
Fund Distributors, Inc.
- --------------------------------------------------------------------------------
<PAGE>
- --------------------------------------------------------------------------------
SCUDDER FLEXI-PLAN
==================
Profit Sharing Plan
Designation of Beneficiary
_________________________ Return this form to:
Name of Employer
_________________________ Scudder Fund Distributors, Inc.
Fund(s) Retirement Plan Services
_________________________ P.O. Box 9047
Account #'s, if assigned Boston, MA 02205-9047
- --------------------------------------------------------------------------------
Name of Participant _______________________
Note: You must file a separate Designation of Beneficiary form for the
Flexi-Money Purchase Pension Plan.
- --------------------------------------------------------------------------------
Instructions
With this form you designate the beneficiary who will receive your Plan assets
if you die while a balance remains in your account. Your spouse must consent if
less than 100% is left to him or her. This form is not effective until filed
with the Plan Trustee.
- --------------------------------------------------------------------------------
Examples of beneficiary designations
o Sandra Casey (SS# 000-00-0000), 3 Oak Street, Chicago, IL 60060, my wife,
if living at my death; otherwise to my children who survive me, in equal
shares. If any child does not survive me, such deceased child's share shall
go by right of representation to that child's issue who survive me. (Note:
"issue" refers to children, grandchildren, etc.)
o Sandra Casey (SS# 000-00-0000) 3 Oak Street, Chicago, IL 60060, my wife, if
living at my death; otherwise to James Casey (SS# ###-##-####), 321 Elm
Street, San Mateo, CA 94042, my son, if living at my death. If he is not
living at my death, then to his issue who survive me by right of
representation.
o James Casey (SS# ###-##-####), 321 Elm Street, San Mateo, CA 94042, my son,
and Mary Casey (SS# 999-99-9999), 7 Beech Avenue, Dallas, TX 75302, my
daughter, in equal shares, if they both survive me; otherwise all to the
one of them who survives me. If neither survives me, to X charity.
These are only examples. You may wish to consult an attorney before naming
beneficiaries.
- --------------------------------------------------------------------------------
Name your plan Beneficiaries and list their Social Security Numbers and
addresses if possible
The following beneficiaries are entitled to receive the assets of my Plan upon
my death. This designation revokes any previous designation. I understand that I
can change this choice of beneficiary by submitting a new form to the Trustee
for the Scudder Plan.
Beneficiaries (Please print): _____________________________
___________________________________________________________
___________________________________________________________
___________________________________________________________
- --------------------------------------------------------------------------------
Sign here
____________________________ ____________________
Your signature Date
- --------------------------------------------------------------------------------
Obtain the consent of your spouse if necessary (both boxes may be checked). If
box (a) is checked, your spouse's signature must be witnessed by a Notary Public
or Plan Representative
|_| (a) If less than 100% of the assets in the Plan have been left to me as
primary beneficiary, I consent to such designation and limit my consent to
the beneficiaries indicated above. In addition, recognizing that I also
have a right to limit my consent to a specific form of benefits (such as a
lump sum distribution or installment payments over a period of time). I
relinquish that right and consent to any form of benefits which may be
elected under the plan. I understand that my spouse must execute a new
designation if he or she wants to designate another beneficiary.
|_| (b) As spouse of a Participant who is a resident of Arizona, California,
Idaho, Louisiana, Nevada, New Mexico, Texas, or Washington, I consent to
(1) the naming of another person as primary beneficiary to receive more
than one-half the plan distributions or (2) the naming of myself as primary
beneficiary and others as contingent beneficiaries.
I acknowledge that I have read the above election and understand the effect
its exercise shall have on me.
____________________________ _____________________
Spouse's signature Date
____________________________ |_| Plan representative
Witness or
|_| Notary Public
State: ____________
<PAGE>
- --------------------------------------------------------------------------------
SCUDDER FLEXI-PLAN
==================
Money Purchase Pension Plan
Adoption Agreement
Return this form to:
Scudder Fund Distributors, Inc.
Retirement Plan Services
P.O. Box 9047
Plan number 004 Boston, MA 02205-9047
- --------------------------------------------------------------------------------
INSTRUCTIONS:
These instructions are provided to help you make selections in the
corresponding sections of the Money Purchase Pension Plan Adoption Agreement.
The Adoption Agreement is designed with "pre-selected" options shaded in each
section. If you want the pre-selected option, please do not check or complete
the unshaded option below. If you prefer the unshaded option, check the box and
fill in any blanks.
1. ELIGIBILITY
This section determines who will be covered by the plan. you determine the
waiting period, how many hours constitute a year of service, minimum age
required, and starting day for participation. You also decide whether you wish
to exclude certain classes of employees from participation in the plan. If this
is your first year of business, you must reduce the waiting period to make
contributions this year.
2. VESTING OF EMPLOYER CONTRIBUTIONS
A. If you choose a waiting period of more than one year in 1.A., you must
select full and immediate vesting. If you choose a waiting period of one
year or less and want graduated vesting, check the unshaded option to
select the vesting schedule in Column 1. For a more rapid schedule, check
the box and complete Column 2.
B. If you choose immediate vesting, skip this section. If your choose
graduated vesting, you may select the 12 month period on which vesting
years are calculated. If you check the unshaded option, you may not check
the box in 2.C., the following section.
C. Do not check the unshaded option if you checked the box in 2.B. If you did
not check the box in 2.B. and want participants to accrue a vesting year
for years they receive an employer contribution, whether or not the
participant completes the number of Hours of Service specified in Section
1.B., check the box in 2.C.
D. Checking a box(es) in this section allows you to calculate vesting years
including a participant's service before the plan (or predecessor plan) was
established or before the plan year in which a participant turned 18.
3. ALLOCATION OF EMPLOYER CONTRIBUTIONS
A. This option allows you to decide whether you will make contributions for
former participants who retired or otherwise terminated participation in
the plan during the plan year. If you do not wish to make contributions for
these former participants, check the unshaded option.
B. If you plan is top heavy, you may be required to make minimum contributions
for non-key employees. If you maintain more than one qualified retirement
plan, this election lets you select the plan responsible for making these
minimum contributions.
Check and complete the unshaded option if you want to make any minimum plan
contributions from another tax-qualified plan or from this Pension Plan if
you have adopted both the Scudder Profit Sharing and Pension Plans.
Do not check the unshaded option if you are adopting only the Money
Purchase Pension Plan.
4. NORMAL RETIREMENT DATE
The normal retirement date for plan participants will be 59 1/2 unless you check
and complete the unshaded option.
5. COMPENSATION
The unshaded option in this section allows you to base contributions on
compensation for the entire year an employee becomes a participant, even if the
employee becomes a participant during the year.
6. PARTICIPANT CONTRIBUTIONS
Non-deductible voluntary contributions (after-tax) are allowed by the plan
unless you select otherwise by checking the unshaded option.
7. INVESTMENT
[Illegible]
8. LOANS
Loans to participants from this plan are not permitted unless you check the
unshaded option. NOTE: Certain owners, including owner-employees, are prohibited
from taking loans from the Plan.
9. EFFECTIVE DATE
The effective date of the plan will be the first day of the employer's fiscal
year, unless otherwise indicated by checking and completing the unshaded option.
10. PLAN YEAR
The plan year will be the employee's fiscal year unless you check and complete
the unshaded option.
11. AMENDMENT
If you are adopting the Money Purchase Pension Plan as an amendment to an
existing plan, please check the unshaded option.
12. PENSION CONTRIBUTIONS AND INTEGRATION WITH SOCIAL SECURITY
If you do not want your plan integrated with Social Security, complete the blank
in the shaded option to designate the contribution rate for the plan. Do not
check the unshaded option.
If you do wish to integrate the plan, check the unshaded option and then specify
the integration rate and integration level. Note: If integration is selected,
please indicate, at the end of the unshaded option, the rate for contributions
made to the plan exclusive of Social Security contribution. The rate chosen
should not result in total contributions to any participant exceeding 25% of
compensation. (For a self-employed individual, the rate should not exceed 25%,
which is the same of 20% of net profits before contributions to the plan for the
self-employed. See guide for more information.)
13. LIMITATIONS ON ALLOCATIONS
This section advises you concerning the limitations on allocations of
contributions if you have other tax-qualified plans in addition to the
Flexi-Plan Profit Sharing Plan or Money Purchase Pension Plan.
14. LIMITATION YEAR
The limitation year will be the same as the plan year unless you check and
complete the unshaded option.
15. SIGNATURES
Please read and complete this section. State Street Bank and Trust Company is
predesignated as the Plan's trustee and the Adoption Agreement is presigned by
an authorized representative of State Street Bank.
If you elect to allow loans to participants in this Agreement, please designate
a loan trustee and obtain the loan trustee's signature. The loan trustee may be
an individual.
Please provide all the information requested, including the employer's tax
identification number and fiscal year. If you do not have a tax identification
number, please contact your local Internal Revenue Service office to obtain a
number.
ADOPTION AGREEMENT AMENDMENT
As permitted under the Tax Reform Act of 1986, forfeitures may be reallocated to
participants rather than reducing future contributions. Check the box if you
want this provision to apply to your plan.
If you have any questions about this Adoption Agreement [Illegible]
<PAGE>
- --------------------------------------------------------------------------------
SCUDDER FLEXI-PLAN
===================
Money Purchase Pension Plan
Adoption Agreement
Return this form to:
Scudder Fund Distributors, Inc.
Retirement Plan Services
P.O. Box 9047
Plan number 004 Boston, MA 02205-9047
- --------------------------------------------------------------------------------
The undersigned (the "Employer") establishes, or amends, the (Scudder
automatically inserts employer's name) Money Purchase Pension Plan, by
completing the Adoption Agreement adopting or amending the Money Purchase
Pension Plan in the form of the Prototype Plan attached.
1. ELIGIBILITY
A. To become a Participant an Employee must complete 3 Years of Service
|_| or, if this box is checked, an Employee must complete _______ Year(s)
of Service, (insert less than "3"; select more than "1" only if the
employer selects full and immediate vesting in Section 2.A. below;
insert "0" for no waiting period).
B. The number of Hours of Service required to have a Year of Service is 1000
|_| or, if this box is checked, ______ (insert less than 1000 hours).
However, if the Year(s) of Service selected in A. above is or includes
a fraction year, an Employee is not required to complete any specified
number of Hours of Service to receive eligibility credit for such
fractional year.
C. To become a Participant an Employee need not attain any minimum age
|_| or, if this box is checked, an Employee must be at least ____ (insert
21 or less) years of age.
D. An Employee who meets the above requirements shall become a Participant on
the first day the requirements are met
|_| or, if this box if checked, on the first day of the next month.
E. All Employees are entitled to be Participants
|_| or, if this box is checked, all Employees are entitled to be
Participants except (check one or both):
|_| Non-resident aliens who receive no earned income from the
Employer which constitutes income from sources within the United
States
|_| Individuals covered by a collective bargaining contract which
meets the requirements specified in the Plan.
2. VESTING OF EMPLOYER CONTRIBUTIONS
A. Employer Contributions under the Plan shall be fully and immediately vested
and non-forfeitable
|_| or, if this box is checked, vested at the rate in Column 1 below, or
at a more rapid rate of vesting if specified in Column 2 below.
VESTING TABLE
Column 1 Column 2
----------- ----------
Vesting Minimum Percentage
Years Percentage Selected
1 0 __________
2 20 __________
3 40 __________
4 60 __________
5 80 __________
6 100 __________
B. Vesting Years and One-Year Breaks in Service for the purpose of vesting
shall be measured on the Plan Year
|_| or, if this box is checked, on the 12 consecutive month period
beginning on the Participant's initial date of employment or an
anniversary of that date.
Note: If you make this election, you may not check the box in Section 2.C.
below.
C. The Participant will have a Vesting Year only if the Participant completes
the number of Hours of Service specified in Section 1.B.
|_| or, if this box is checked, if the Participant either completes the
number of Hours of Service specified in Section 1.B. or receives an
allocation of the Employer Contribution for the Plan Year, or both.
D. The following Service will be included in determining Vesting Years only if
checked below:
|_| Service before the Employer maintained this Plan or a predecessor plan
|_| Service before the first Plan Year in which a Participant attained age
18.
<PAGE>
3. ALLOCATION OF EMPLOYER CONTRIBUTIONS
A. A former Participant who has retired, died, otherwise terminated Service,
or transferred to an ineligible class of Employees during the Plan year
shall share in the allocation of Employer Contributions for the Plan Year
|_| or, if this box is checked, shall not share in the allocation of
Employer Contributions.
B. Any required minimum top heavy allocations will be made first from this
Plan unless the Employer has also adopted a Scudder Profit Sharing Plan
(plan number 001 and 003), in which case the minimum top heavy allocations
will be made first from that plan.
|_| or, if this box is checked, first from the _______________ Plan
(insert name of another qualified plan maintained by the Employer).
4. NORMAL RETIREMENT DATE
A. Participant's Normal Retirement Date shall be age 59 1/2
|_| or, if this box is checked, age ________________ (insert more than 59
1/2 but not more than 65).
5. COMPENSATION
"Compensation" shall only include amounts paid during the Plan Year by the
Employer to the Employee while the Employee was a Participant
|_| or, if this box is checked, "Compensation" shall include amounts paid
by the Employer to the Employee during the entire Plan Year in which
an Employee became a Participant whether or not such Employee was a
Participant for the entire Plan Year.
6. PARTICIPANT CONTRIBUTIONS
Non-deductible Voluntary contributions by a Participant are permitted
|_| or, if this box is checked, are not permitted.
7. INVESTMENT
Investment decisions shall be made by the Participant
|_| or, if this box is checked, by the Administrator.
8. LOANS
Loans to a Participant are not permitted
|_| or, if this box is checked, are permitted.
9. EFFECTIVE DATE
The Effective Date of the Plan or Amendment shall be the first day of the
Employer's fiscal year during which the Plan is adopted or amended
|_| or, if this box is checked, _____________________ (insert date).
10. PLAN YEAR
The Plan Year shall be the same as the fiscal year of the Employer
|_| or, if this box is checked, shall end on the last day of the month of
___________________.
11. AMENDMENT
Execution of the Adoption Agreement is not an amendment to an existing plan
|_| or, if this box is checked, is an amendment to an existing plan.
12. PENSION CONTRIBUTIONS AND INTEGRATION WITH SOCIAL SECURITY
The Plan will not be integrated with Social Security and for each Plan Year the
Employer will contribute to the Account of each Participant entitled to an
allocation under Section 3, _____________% (insert not more than 25%) of that
Participant's Compensation for the Plan Year.
|_| or, if this box is checked,
the Plan will be integrated with Social Security and for each Plan
Year, the Employer will contribute
|_| the OASDI Rate
or
|_| ___________% (not to exceed the OASDI Rate)
of such Participant's Compensation in excess of (check one):
|_| the Social Security Wage Base
or
|_| [Illegible text] Social Security Wage Base
<PAGE>
Note: Rates chosen should not result in total contributions to any Participant
exceeding 25% of that Employee's aggregate Compensation.
Employer contributions allocable to a Participant shall be reduced by that
Participant's allocation of forfeitures arising during preceding Plan
Years.
An Employer may elect to integrate the Plan with Social Security only if
the Employer does not maintain another qualified retirement plan integrated
with Social Security.
13. LIMITATION ON ALLOCATIONS
If the Employer maintains or has ever maintained another qualified defined
contribution plan other than a Scudder Profit Sharing Plan (Plan number 001 or
003) or a plan amended into the Prototype Plan in which any Participant in this
Plan is or was a participant or could possible become a participant, the
provisions of Section 5.03 of the Prototype Plan will apply.
If the Employer maintains or has ever maintained a qualified defined benefit
plan in which any Participant in this Plan is or was a participant or could
possibly become a participant, the provisions of Section 5.04 of the Prototype
Plan will apply.
14. LIMITATION YEAR
The Limitation Year shall be identical for all plans maintained by the Employer
and is the Plan Year
|_| or, if this box is checked, shall end on the last day of the month of
_________________.
15. SIGNATURES
The Employer (1) covenants and agrees that whenever a Participant makes a
contribution the Employer shall ascertain that the Participant has received a
copy of the current prospectus relating to the shares of any Designated
Investment Company in which such contribution is to be invested plus, where
required by any state or federal law, the current prospectus relating to any
other investment in which contributions are to be invested, and (2) by remitting
such a contribution to the Trustee the Employer shall be deemed to represent
that the Participant has received such a prospectus, and (3) by remitting any
other contribution to the Trustee the Employer shall be deemed to represent that
the Employer has received a current prospectus of any Designated Investment
Company in which it is to be invested, plus, where required by any state or
federal law, the current prospectus relating to any other investment in which
contributions are to be invested.
An Employer adopting this plan may rely on the opinion letter issued by the
National Office of the Internal Revenue Service as evidence that this Plan is
qualified under Section 401 of the Internal Revenue Code, provided that the
Employer has never maintained, is not maintaining, and will not (while
maintaining this Plan) adopt a qualified plan (other than the Scudder Profit
Sharing Plan (plan number 001 or 003) or a plan which is being amended into this
Plan or the Scudder Profit Sharing Plan (plan number 001 and 003)) or after
December 31, 1985, a welfare benefit fund (as defined in Code Section 419(e))
which provides post retirement benefits allocated to separate accounts for Key
Employees (as defined in Code Section 419A(d)(3)).
An employer who adopts or maintains multiple plans other than the Scudder Profit
Sharing Plan (plan number 001 or 003) together with the Scudder Money Purchase
Pension Plan (plan number 002 or 004) may apply for a determination letter from
the appropriate Key District Director of the Internal Revenue to obtain reliance
that the plans are qualified.
This Adoption Agreement may be used only in conjunction with basic plan document
#01.
_________________________________ _____________________________
Name of Employer Name of Loan Trustee*
_________________________________ _____________________________
Signature of Employer Signature
_________________________________ *NOTE: If you elect to allow loans
Date to Participants in Section 8, you
must designate a Loan Trustee
_________________________________
Street Address Trustee:
_________________________________
City State Zip State Street Bank and Trust Company
_________________________________ By: /s/ G. Reeves
Daytime Telephone --------------------------
_________________________________ ADOPTION AGREEMENT AMENDMENT
Employer Tax Identification Number Benefit Forfeitures in Money Purchase Plan
(check the option below if you wish
_________________________________ it to apply to your plan)
Employer Fiscal Year
Please make copies of all completed forms for your records
|_| Notwithstanding any other provision of the plan, forfeitures occurring in
Plan Years beginning on or after __________ [fill in the first day of the
Plan Year in which this Adoption Agreement Amendment is executed or a
subsequent anniversary of such date] shall be allocated to those
Participants entitled to an allocation of employer contributions for the
Plan Year in which the forfeiture occurs.
<PAGE>
To be Completed by Employer
- --------------------------------------------------------------------------------
SCUDDER FLEXI-PLAN
==================
Money Purchase Pension Plan
Contribution Form
Return this form to:
Scudder Fund Distributors, Inc.
Retirement Plan Services
P.O. Box 9047
Boston, MA 02205-9047
- --------------------------------------------------------------------------------
Employer Information
Name____________________________________ Tax I.D. #__________________
Business Address________________________ Telephone___________________
City________________________State________Zip Code____________________
- --------------------------------------------------------------------------------
Telephone Exchange Option
You or your plan participants will be able to exchange shares from one Scudder
Fund into any other Scudder Fund by telephone, telegram, or TWX. The new account
will have the identical registration as the account from which the shares are
transferred.
- --------------------------------------------------------------------------------
Participant Information
The minimum investment for the first Scudder plan you establish (either the
Profit Sharing Plan or the Pension Plan) is $500 times the number of
participants, which may be allocated in any amounts among the participants (e.g.
2 participants, minimum investment = $1000 which can be allocated $700 for one
and $300 for the other). If you are establishing both plans, the minimum
investment for the second plan is $300 times the number of participants.
Participants may invest in more than one Scudder Fund if at least $500 is
invested in each fund.
|_| Check here if assets to be invested in the Money Purchase Pension Plan will
include a transfer from an existing plan. Please also complete the enclosed
transfer form. (Please designate allocation of transfer money on the transfer
form, and not on this form.)
Scudder Fund(s) Contribution Amount
Selected Employer Employee Total
Participant_______________ _____________ $_______ $_______ $_____
Birth Date_______________ _____________ ________ ________ ______
Social Security #________ _____________ ________ ________ ______
Participant_______________ _____________ ________ ________ ______
Birth Date_______________ _____________ ________ ________ ______
Social Security #________ _____________ ________ ________ ______
Participant_______________ _____________ ________ ________ ______
Birth Date_______________ _____________ ________ ________ ______
Social Security #________ _____________ ________ ________ ______
(Please attach additional pages if necessary) Total investment $=====
Please make your contribution check payable to State Street Bank and Trust Co.
<PAGE>
- --------------------------------------------------------------------------------
SCUDDER FLEXI-PLAN
==================
Money Purchase Pension Plan
Designation of Beneficiary
Waiver of Qualified Preretirement Survivor Annuity
_________________________ Return this form to:
Name of Employer
_________________________ Scudder Fund Distributors, Inc.
Fund(s) Retirement Plan Services
_________________________ P.O. Box 9047
Account #'s, if assigned Boston, MA 02205-9047
- --------------------------------------------------------------------------------
Name of Participant _______________________
Note: You must file a separate Designation of Beneficiary form for the
Flexi-Profit Sharing Plan.
- --------------------------------------------------------------------------------
Instructions
With this form you designate the beneficiary who will receive your account
balance if you die while a balance remains in your account. Please not that if
you are married and you die before beginning distributions from the Plan, your
spouse is automatically entitled to 50% of the account balance in the form of a
preretirement survivor annuity, unless you make the waiver election below
(Waiver of Preretirement Survivor Annuity) and your spouse consents (on the back
of this form).
In addition, once you begin distributions from your account, the
distributions will be in the form of a joint and survivor annuity whether you
are married or unmarried, unless you waive that right (a separate waiver form is
available to waive the joint and survivor annuity).
If you waive the preretirement survivor annuity with your spouse's consent,
the beneficiary designation below will apply to your entire account balance. If
you do not waive the annuity, or if your spouse does not consent to the waiver,
the beneficiary designation will apply only to the 50% of the account not
distributable as a preretirement survivor annuity.
- --------------------------------------------------------------------------------
Examples of beneficiary designations
o Sandra Casey (SS# 000-00-0000), 3 Oak Street, Chicago, IL 60060, my wife,
if living at my death; otherwise to my children who survive me, in equal
shares. If any child does not survive me, such deceased child's share shall
go by right of representation to that child's issue who survive me. (Note:
"issue" refers to children, grandchildren, etc.)
o Sandra Casey (SS# 000-00-0000) 3 Oak Street, Chicago, IL 60060, my wife, if
living at my death; otherwise to James Casey (SS# ###-##-####), 321 Elm
Street, San Mateo, CA 94042, my son, if living at my death. If he is not
living at my death, then to his issue who survive me by right of
representation.
o James Casey (SS# ###-##-####), 321 Elm Street, San Mateo, CA 94042, my son,
and Mary Casey (SS# 999-99-9999), 7 Beech Avenue, Dallas, TX 75302, my
daughter, in equal shares, if they both survive me; otherwise all to the
one of them who survives me. If neither survives me, to X charity.
These are only examples. You may wish to consult an attorney before naming
beneficiaries.
- --------------------------------------------------------------------------------
Name your plan Beneficiaries and list their Social Security Numbers and
addresses if possible
The following beneficiaries are entitled to receive the assets of my Plan upon
my death. This designation revokes any previous designation. I understand that I
can change this choice of beneficiary by submitting a new form to the Trustee
for the Scudder Money Purchase Pension Plan.
Beneficiaries (Please print): ____________________________________
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
- --------------------------------------------------------------------------------
Waiver of Preretirement Survivor Annuity
This waiver is effective only when executed by a married individual either (a)
during or after the plan year in which such individual attains age 35, or (b)
after the individual separates from service, if earlier. Check box if you are
eligible and you wish to make a waiver election.
|_| I waive automatic payment of the portion of my account balance which would
otherwise be distributed as a preretirement survivor annuity. I acknowledge
that I have read and understood the information provided to me concerning
such annuity. I reserve the right to revoke this election to waive the
annuity coverage.
________________________________________________________________________________
Sign here
__________________________________ __________________________
Your signature Date
_________/___/______
Your Date of Birth
- --------------------------------------------------------------------------------
(over, please)
<PAGE>
Obtain the consent of your spouse if necessary (both boxes may be checked). If
box (a) is checked, your spouse's signature must be witnessed by a Notary Public
or Plan Representative
|_| (a) I, the spouse of the Participant, have read the above waiver of
preretirement survivor annuity and understand that the effect such waiver
has on me may be that all death benefits under the plan may be paid to
someone other than me. By signing below, I consent to my spouse's waiver of
a preretirement survivor annuity. My consent is limited to the
beneficiary(ies) listed above. In addition, recognizing that I also have
the right to limit my consent to a specific form of benefits (such as a
lump sum distribution or installments over a period of time), by signing
below, I relinquish that right and consent to any form of benefits which
may be elected under the Plan.
I understand that my spouse must execute a new designation if he or
she wants to designate another beneficiary.
|_| (b) As spouse of a Participant who is a resident of Arizona, California,
Idaho, Louisiana, Nevada, New Mexico, Texas, or Washington, I consent to
(1) the naming of another person as primary beneficiary to receive more
than one-half of my spouse's account balance or (2) the naming of myself as
primary beneficiary and others as contingent beneficiaries.
I acknowledge that I have read the above election and understand the
effect its exercise shall have on me.
______________________________ _________________________
Spouse's signature Date
Witness_________________________________________________
|_| Plan Rep. or |_| Notary Public
State: _________________________
Commission Expires: ____________
<PAGE>
[In the printed material, this page contains photocopies of two IRS approval
letters]
IRS
Approval
Letters
<PAGE>
- --------------------------------------------------------------------------------
NOTICE TO INTERESTED PARTIES
================================================================================
After enrolling in the Scudder Flexi-Plan, please complete this notice and post
it in a common area for your employees' information.
(Where no determination letter submission is required in order for the employer
to obtain reliance, this notice must be posted 9 to 23 days after adoption or
amendment of a plan. Where a determination letter submission is required, this
notice must be posted 7 to 21 days prior to the submission.)
An employer adopting a master or prototype plan or an amendment thereto or a
restatement thereof, is required to notify all interested parties including all
employees and any self-employed individuals) of such adoption, amendment, or
restatement. Recently, ___________________ (name of employer) |_| adopted |_|
restated the |_| __________________ Money Purchase Pension Plan |_|
_____________________ Profit Sharing Plan (the "Plan"). The Internal Revenue
Service, On August 5, 1985, issued an opinion letter with respect to this
(amended form of) plan as a tax qualified prototype.
1. Notice to employees of ____________________________________ (name of
employer)(the "Employer").
An application |_| is |_| is not to be made to the Internal Revenue Service
by the Employer for determination on the qualification of the employee
benefit pension plan described below.
2. The Employer has |_| adopted |_| restated the employee pension benefit plan
described below on ___________________________.
3. The name of the plan is _______________________________ (insert full name
of plan from first paragraph of adoption agreement).
4. The plan's identification number is ____. (For instance, the first plan
will be No. 001 and subsequent plans No. 002, 003, etc.)
5. The name and address of the Employer is _________________________
___________________________________________________________________.
6. The prototype plan's Opinion Letter number is |_| C212885a (if the Plan is
a profit sharing plan) |_| C212883a (if the Plan is a money purchase
pension plan).
7. The plan's sponsor is Scudder Fund Distributors, Inc., 175 Federal Street,
Boston, Massachusetts 02110.
8. The Employer's Tax Identification Number is _____________________.
9. The plan administrator's name and address is ____________________
___________________________________________________________________.
(If none appointed, insert Employer's name).
10. The address of the Key District Director having jurisdiction over the plan
is ______________________________________________.*
* Please refer to chart at Appendix A, attached hereto.
11. The employees eligible to participate under the plan are (describe by
class): __________________________________________________________________
_________________________________________________________________________.
12. The Internal Revenue Service |_| has |_| has not previously issued a
determination letter with respect to the qualification of this plan.
13. Check Appropriate Box:
|_| For employers who are required to make a determination letter
submission to the IRS:
The application will be filed on ____________________________ with the
Key District Director, Internal Revenue Service at ___________________
for an advance determination as to whether the plan meets the
qualification requirements of section 401, 403(a) or 405(a) of the
Internal Revenue Code with respect to the plan's |_| initial
qualification |_| amendment |_| termination |_| merger |_|
consolidation or |_| transfer of plan assets or liabilities.
|_| For employers who are not required to make a determination letter to
the IRS.
It is not contemplated that the plan will be submitted to the Internal
Revenue Service for an advance determination as to whether it meets
the qualification requirements of section 401 of the Internal Revenue
Code with respect to either its initial qualification or any
subsequent amendment.
RIGHTS OF INTERESTED PARTIES
14. You have the right to submit to the Key District Director, at the above
address, either individually or jointly with other interested parties, your
comments as to whether this plan meets the qualification requirements of
the Internal Revenue Code. You may instead, individually or jointly with
other interested parties, request the Department of Labor to submit, on
your behalf, comments to the Key District Director regarding qualification
of the plan. If the Department declines to comment on all or some of the
matters [Illegible text].
<PAGE>
REQUESTS FOR COMMENTS BY THE DOL
15. Check Appropriate Box:
|_| For employers who are required to make a determination letter
submission to the IRS:
The Department of Labor may not comment on behalf of interested
partied unless requested to do so by the lesser of 10 employees or 10% of
the employees who qualify as interested parties. The number of persons
needed for the Department to comment with respect to this plan is _____. If
you request the Department to comment, your comment must be in writing and
must specify the matters upon which comments are requested, and also must
include:
(1) the information contained in items 2 through 9 of this Notice; and
(2) the number of persons needed for the Department to comment.
|_| For employers who are not required to make a determination letter
submission to the IRS:
The Department of Labor may not comment on behalf of interested
partied unless requested to do so by the lesser of 10 employees or 10% of
the employees who qualify as interested parties. The number of persons
needed for the Department to comment with respect to this plan is _____. If
you request the Department to comment, your comment must be in writing and
must specify the matters upon which comments are requested, and must also
include:
(1) the information contained in items 2 through 9 of this Notice; and
(2) the number of persons needed for the Department to comment.
- --------------------------------------------------------------------------------
A request to the Department to comment should be addressed as follows:
Administrator of Pension and Welfare Benefit Programs
U.S. Department of Labor
200 Constitution Avenue, N.W.
Washington, D.C. 20216
ATTN: 3001 Comment Request
COMMENTS TO THE IRS
16. Check Appropriate Box:
|_| For employers who are required to make a determination letter
submission to the IRS:
Comments submitted by you to the Key District Director must be in
writing and received by him by _______________________ (the 45th day
after the date on which the application for determination is received
by the Key District Director). However, if there are matters you
request the Department of Labor to comment upon your behalf, and the
Department declines, you may submit comments on these matters to the
Key District Director to be received by him on __________________
(within 15 days from the time the Department notifies you that it will
not comment on a particular matter), or by ________________________
(the 45th day after the date on which the application for
determination is received by the Key District Director), whichever is
later. A request to the Department to comment on your behalf must be
received by it by ____________________ (the 15th day after the date on
which the application for determination is received by the Key
District Director) if you wish to preserve your right to comment on a
matter upon which the Department declines to comment, or by
____________________ (the 25th day after the date on which the
application for determination is received by the Key District
Director) if you wish to waive that right.
|_| For employers who are not required to make a determination letter
submission to the IRS:
Comments submitted by you to the Key District Director must be in
writing and received by him by _______________________ (the 75th day
after the date on which the plan is adopted or amended). However, if
there are matters you request the Department of Labor to comment upon
your behalf, and the Department declines, you may submit comments on
these matters to the Key District Director to be received by him on
__________________ (within 15 days from the time the Department
notifies you that it will not comment on a particular matter), or by
________________________ (the 75th day after the date on which the
plan is adopted or amended), whichever is later. A request to the
Department to comment on your behalf must be received by it by
____________________ (the 45th day after the date on which the plan is
adopted or amended) if you wish to preserve your right to comment on a
matter upon which the Department declines to comment, or by
____________________ (the 55th day after the date on which the plan is
adopted or amended) if you wish to waive that right.
ADDITIONAL INFORMATION
17. Check Appropriate Box:
|_| For employers who are required to make a determination letter
submission to the IRS:
Detailed instruction regarding the requirements for notification of
interested parties may be found in sections 6,7 and 8 of Revenue Procedure
80-30. Additional information concerning this adoption or amendment
(including, where applicable, an updated copy of the plan and related
trust; the application for determination; and any additional documents
dealing with the application for determination; and copies of section 6 of
Revenue Procedure 80-30) is available at _________________ during the hours
of __________________ for inspection and copying. (There is a nominal
charge for copying and/or mailing.)
<PAGE>
|_| For employers who are not required to make a determination letter
submission to the IRS:
Detailed instruction regarding the requirements for notification of
interested parties may be found in sections 6,7 and 8 of Revenue Procedure
80-30. Additional information concerning this adoption or amendment
(including, where applicable, a description of the provisions providing for
nonforfeitable benefits; a description of the circumstances which may
result in ineligibility or loss of benefits; a description of the source of
financing of the plan; and copies of section 6 of Revenue Procedure 80-30)
is available at _________________ during the hours of __________________
for inspection and copying. (There is a nominal charge for copying and/or
mailing.)
Appendix A
Key District Addresses
Key District IRS Districts Covered
Mid Atlantic Region
Baltimore Baltimore, Pittsburgh, Richmond
31 Hopkins Plaza
Baltimore, MD 21201
Newark Newark, Philadelphia, Wilmington
70 Broad Street
Newark, NJ 07102
North Atlantic Region
Brooklyn Albany, Augusta, Boston, Brooklyn,
35 Tillary Street Buffalo, Burlington, Hartford,
Brooklyn, NY 11201 Manhattan, Portsmouth, Providence
Central Region
Cincinnati Cincinnati, Cleveland, Detroit,
550 Main Street Indianapolis, Louisville,
Cincinnati, OH 45202 Parkersburg
Midwest Region
Chicago Aberdeen, Chicago, Des Moines,
230 S. Dearborn Street Fargo, Helena, Milwaukee, Omaha,
Chicago, IL 60604 St. Louis, St. Paul, Springfield
Southeast Region
Atlanta Atlanta, Birmingham, Columbia,
275 Peachtree Street, NE Greensboro, Jackson, Jacksonville,
Atlanta, GA 30303 Little Rock, Nashville, New Orleans
Southwest Region
Dallas Albuquerque, Austin, Cheyenne,
1100 Commerce Street Dallas, Denver, Houston, Oklahoma
Dallas, TX 75202 City, Phoenix, Salt Lake City, Wichita
Western Region
Los Angeles Anchorage, Boise, Honolulu, Laguna
300 N. Los Angeles Street Niguel, Los Angeles, Portland, Reno,
Los Angeles, CA 90012 Sacramento, San Francisco, San Jose,
Seattle
<PAGE>
-------------
TELEPHONE
NUMBERS AND
ADDRESSES
=============
-----------------------------------------
For questions about Scudder Flexi-Plan
Call: (Toll-free)
1-800-323-6105
or
Write to:
Scudder Funds
Group Retirement Plans Dept.
175 Federal Street
Boston, MA 02110-2267
-----------------------------------------
For questions about the Scudder Funds
Call: (Toll-free)
1-800-225-2470
or
Write to:
Scudder Funds
160 Federal Street
Boston, MA 02110
-----------------------------------------
To arrange transactions and for questions
about existing accounts
Call: (Toll-free)
1-800-225-5163
or
Write to:
Scudder Funds
P.O. Box 2291
Boston, MA 02107-2291
================================================================================
Scudder Offices
Boston
160 Federal Street
Boston, Massachusetts 02110
800-225-2470
Chicago
111 East Wacker Drive, 22nd Fl.
Chicago, Illinois 60601
312-861-2700
Cincinnati
555 Carew Tower
Cincinnati, Ohio 45202
513-621-4200
Cleveland
950 Terminal Tower
Cleveland, Ohio 44113
216-241-7744
Houston
1100 Louisiana Street
Suit 2190
Houston, Texas 77002
713-659-3838
800-445-0544 (in Texas)
Los Angeles
333 South Hope Street, 37th Fl.
Los Angeles, California 90071
213-628-1144
New York
345 Park Avenue, 26th Fl.
New York, New York 10154
212-326-6200
Philadelphia
Three Mellon Bank Center
Philadelphia, Pennsylvania 19102
215-864-7200
Portland, Oregon
One S.W. Columbia Street
Suite 575
Portland, Oregon 97258
503-224-3999
San Francisco
101 California Street, 41st Fl.
San Francisco, California 94111
415-981-8191
West Palm Beach
Phillips Point, Suite 1100
777 South Flagler Drive
West Palm Beach
Florida, 33401
305-832-3600
<PAGE>
Return a copy to:
Scudder Fund Distributors, Inc.
Retirement Plan Services
175 Federal Street
Boston, MA 02110
SCUDDER FLEX I-PLAN
Profit Sharing Plan
Plan number 005 Adoption Agreement
The undersigned (the "Employer") establishes, or amends, the (Scudder
automatically inserts employer's name) Profit Sharing Plan, by completing this
Adoption Agreement adopting or amending the Profit Sharing Plan in the form of
the Prototype Plan attached.
I. ELIGIBILITY
A. To become a Participant an Employee must complete 3 Years of
Service
|_| or, if this box is checked, an Employee must complete _____
Year(s) of Service, (insert less than "3"; select more than
"1" only if the Employer selects full and immediate vesting
in Section II.A. below; insert "0" for no waiting period).
B. The number of Hours of Service required to have a Year of Service
is 1000
|_| or, if this box is checked, _____ (insert less than 1000
hours). However, if the Year(s) of Service selected in A.
above is or includes a fractional year, an Employee is not
required to complete any specified number of Hours of
Service to receive eligibility credit for such fractional
year.
C. To become a Participant an Employee need not attain any minimum
age
|_| or, if this box is checked, an Employee must be at least
_____ (insert "21" or less) years of age.
D. An Employee who meets the above requirements shall become a
Participant on the first day the requirements are met
|_| or, if this box is checked, on the first day of the next
month.
<PAGE>
E. All Employees are entitled to be Participants except [one or more
may be selected]:
|_| Non-resident aliens who receive no earned income from the
Employer which constitutes income from sources within the
United States
|_| Individuals covered by a collective bargaining contract
which meets the requirements specified in the Plan
|_| Salaried Employees
|_| Hourly-paid Employees
|_| Piece-rate Employees
|_| Employees paid by commission
|_| Employees covered by another retirement plan to which the
Employer is required to contribute
|_| Employees in the following non-discriminatory
classification:
___________________________________________________________.
Note: If Employees are excluded from the Plan under one or more of the
classifications above (not including the first two
classifications) the exclusion must NOT result in discrimination
in favor of officers, shareholders or highly paid Employees.
-2-
<PAGE>
II. EMPLOYER CONTRIBUTIONS
Each Plan Year, the Employer shall make an Employer Contribution to
the Plan in an amount determined by it, in its discretion
|_| and, if this box is checked, an amount equal to _____% of
aggregate Nondeductible Voluntary Contributions made during the
Plan Year by Participants whose Non-deductible Voluntary
Contributions equal or exceed _____% [insert "0" or a number not
in excess of the next chosen number] of such Participant's
Compensation, but only to the extent that such Participant's
Non-deductible Voluntary Contributions do not exceed _____%
[insert "6" or less] of such Participant's Compensation; plus
such additional amount as shall be determined by the Employer, in
its discretion, to be allocated in proportion to Participant's
Non-deductible Voluntary Contributions in excess of the second
above designated percentage, but not in excess of the last above
designated percentage.
III. VESTING OF EMPLOYER CONTRIBUTIONS
A. Employer Contributions under the Plan shall be fully and
immediately vested and non-forfeitable
or, check one:
|_| Vested at the "Top-Heavy" rate in Column 1 below
|_| Vested at the "4-40 vesting" rate in Column 2 below
|_| Vested at the rate specified in Column 4 below, which rate
shall be at least as rapid as the rate in Column 3 below.
-3-
<PAGE>
VESTING TABLE
Column 1 Column 2 Column 3 Column 4
Vesting "Top-Heavy" "4-40 Vesting" Minimum Percent age
Years Percentage Percentage Percentage Elected
------- ----------- -------------- ---------- -----------
1 0 0 0 _____
2 20 0 0 _____
3 40 0 0 _____
4 60 40 0 _____
5 80 45 25 _____
6 100 50 30 _____
7 100 60 35 _____
8 100 70 40 _____
9 100 80 45 _____
10 100 90 50 _____
11 100 100 60 _____
12 100 100 70 _____
13 100 100 80 _____
14 100 100 90 _____
15 100 100 100 _____
B. Vesting Years and One-Year Breaks in Service for the purpose of
vesting shall be measured on the Plan Year
|_| or, if this box is checked, on the 12 consecutive month
period beginning on the Participant's initial date of
employment or an anniversary of that date.
Note: If you make this election, you may not make elections
in Sections III.C. or IV.B.
C. The Participant will have a Vesting Year only if the Participant
completes the number of Hours of Service specified in Section
I.B.
|_| or, if this box is checked, if the Participant either
completes the number of Hours of Service specified In
Section I.B. or receives an allocation of the Employer
Contribution for the Plan Year, or both.
-4-
<PAGE>
D. The following Service will be included in determining Vesting
Years only if checked:
|_| Service before the first Plan Year in which the Participant
attained age 18
|_| Service before the Employer maintained this Plan or a
predecessor plan
|_| Service before January 1, 1971, unless the Participant has
completed at least 3 Vesting Years after December 31, 1970
|_| Service before the first Plan Year to which ERISA is
applicable if this Plan is a continuation of an earlier plan
which would have disregarded such service
|_| Service after five consecutive One-Year Breaks in Service
(but this exclusion shall apply only for the purpose of
computing the vested percentage of Employer Contributions
made before such break)
|_| Service before a period of consecutive One-Year Breaks in
Service, if the Participant had no vested interest at the
time of such breaks and the number of consecutive One-Year
Breaks in Service equals or exceeds the greater of five or
the number of Vesting Years before such break without
counting Vesting Years excluded by an earlier application of
this provision.
E. If the Plan shifts out of Top-Heavy status for any Plan Year, the
vesting schedule in effect while the Plan was Top-Heavy will
continue to be in effect for all existing and future Participants
|_| or, if this box is checked, the Plan will shift to the
vesting schedule selected in Section III.A. for all Plan
Years during which the Plan is not Top-Heavy.
-5-
<PAGE>
IV. ALLOCATION OF EMPLOYER CONTRIBUTIONS
A. A former Participant who has retired, died, otherwise terminated
Service, or transferred to an ineligible class of Employees
during the Plan Year shall share in the allocation of Employer
Contributions for the Plan Year
|_| or, if this box is checked, shall not share in the
allocation of Employer Contributions.
B. Participants will share in the allocation of Employer
Contributions for a Plan Year regardless of the number of Hours
of Service completed in such Plan Year
|_| or, if this box is checked, in a Plan Year in which the Plan
is not Top-Heavy, only if they complete during such Plan
Year the number of Hours of Service specified in Section
I.B.
C. Any minimum Top-Heavy allocations of the Plan will be made first
by this Plan
|_| or, if this box is checked, by the ____________ Plan (insert
name of another qualified plan maintained by the Employer).
D. In any Year in which the Plan is Top-Heavy, the minimum Top-Heavy
Allocation shall be at the rate of 3%
|_| or, if this box is checked, at the rate of 4%.
Note: The Employer may not make a selection in A. or B. above, if
it has previously made an election in Section II.
V. INTEGRATION WITH SOCIAL SECURITY
The Plan will not be integrated with Social Security
|_| or, if this box is checked, will be integrated with Social
Security on the following basis:
-6-
<PAGE>
A. The Integration Level for a Plan Year will be the Social Security
Wage Base for such Plan year
|_| or, if this box is checked, $________ (not in excess of
Social Security Wage Base).
B. The Integration Rate for a Plan Year will be the OASDI Rate for
such Plan Year
|_| or, if this box is checked, ________% (not in excess of
OASDI rate).
Note: An employer may elect to integrate the Plan with Social
Security only if the Employer both does not maintain another
qualified retirement plan integrated with Social Security
and has not made an election in Section II above.
VI. NORMAL RETIREMENT DATE
A participant's Normal Retirement Date shall be age 59-1/2
|_] or, if this box is checked, age __________ (insert more than
59-1/2 but not more than 65).
VII. COMPENSATION
"Compensation" shall Include mounts paid during the Plan Year by the
Employer to the Employee while the Employee was a Participant
|_| or, if this box is checked, "Compensation" shall include
amounts paid by the Employer to the Employee during the
entire Plan Year in which an Employee became a Participant
whether or not such an Employee was a Participant for the
entire Plan Year.
|_| and, if this box is checked, "Compensation" shall not
include the following (select one or more if desired):
( ) Bonuses
( ) Commissions
( ) Overtime Payments
( ) Other (specify) ____________________.
-7-
<PAGE>
Note: The above exclusions from Compensation shall only apply if
benefits under this plan are not integrated with Social
Security Benefits. Furthermore, the above exclusions must
not result in prohibited discrimination under Code Section
401(a)(4).
VIII. PARTICIPANT CONTRIBUTIONS
A. Nondeductible Voluntary Contributions by a Participant are
permitted
|_| or, if this box is checked, are not permitted.
B. Deductible Voluntary Contributions (QVECs) by a Participant are
not permitted
|_| or, if this box is checked, are permitted.
IX. INVESTMENT
Investment decisions shall be made by the Participant
|_| or, if this box is checked, by the Administrator.
X. LOANS
Loans to a Participant are not permitted
|_| or, if this box is checked, are permitted.
XI. EFFECTIVE DATE
The Effective Date of this Plan or amendment shall be the first day of
the Employer's fiscal year during which the Plan is adopted or amended
|_| or, if this box is checked, ____________________.
-8-
<PAGE>
XII. PLAN AND LIMITATION YEARS
A. The Plan Year shall be the same as the fiscal year of the
Employer
|_| or, if this box is checked, shall end on the last day of the
month of _______________
B. The Limitation Year shall be identical for all plans of the
Employer and is the Plan Year
|_| or, if this box is checked, shall end on the last day of the
month of _________________.
XIII. AMENDMENT
Execution of this Adoption Agreement is not an amendment to an
existing plan
|_| or, if this box is checked, is an amendment to an existing
plan.
XIV. LIMITATIONS ON ALLOCATIONS
This section applies only for an employer who maintains or has ever
maintained another qualified retirement plan, other than the Scudder
Prototype Plan adopted as a Money Purchase Pension Plan, or a Plan
amended into the Scudder Prototype Plan, in which any participant in
this plan is or was a participant or could possibly become a
participant.
A. If the Participant is covered under another qualified defined
contribution plan maintained by the Employer, other than a master
or prototype plan, the provisions of Section 5 of the Prototype
Plan will apply as if the other plan were a master or prototype
plan
|_| or, if this box is checked, the attached rider describes the
method by which the plans will limit total Annual Addition
to the Maximum Permissible Amount described in Section 5.5
of the Plan and reduce any excess amount in a manner that
precludes Employer discretion.
-9-
<PAGE>
B. If the Participant is, or has ever been, a participant in a
defined benefit plan maintained by the Employer, the provisons
of Section 5 of the Prototype Plan will apply
or, if this box is checked, the attached rider describes the
method by which the plans involved will satisfy the 1.0
limitation described in Section 5.4 of the Plan and reduce
any excess amount in a manner that precludes Employer
discreation.
XV. APPOINTMENT OF TRUSTEES:
The Employer hereby designates the following person or persons as
Trustee(s) under the Trust:
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
XVI. SIGNATURES
The Employer (1) convenants and agrees that whenever a Participant
makes a contribution the Employer shall ascertain that the Participant
has received a copy of the current prospectus relating to the shares
of any Designated Investment Company in which such contribution is to
be invested, plus, where required by any state or federal law, the
current prospectus relating to any other investment in which
contributions are to be invested, and (2) by remitting such a
contribution to the Trustee the Employer shall be deemed to represent
that the Participant has received such a prospectus, and (3) by
remitting any other contribution to the Trustee the Employer shall be
deemed to represent that the Employer has received a current
prospectus of any Designated Investment Company in which it is to be
invested, plus, where required by any state or federal law, the
current prospectus relating to any other investment in which
contributions are to be invested.
An Employer adopting this Plan may not rely on the opinion letter
issued by the National Office of the Internal Revenue Service as
evidence that this Plan is qualified under Code D Section 401. An
Employer who wishes to obtain such reliance should apply for a
determination letter from the appropriate Key District Director of the
Internal Revenue Service to obtain reliance that the Plan is
qualified.
This Adoption Agreement may be used in conjunction with basic Plan
Document #01.
-10-
<PAGE>
IN WITNESS WHEREOF, the Employer has hereunto executed this Adoption
Agreement as of the _______ day of ______________ , 19_____.
__________________________________ Trustee(s) Signature(s):
Print Name of Employer
__________________________________ _____________________________
Signature of Employer
__________________________________ _____________________________
Street Address
__________________________________ _____________________________
City State Zip
__________________________________ _____________________________
Telephone
__________________________________ _____________________________
Employer Tax Identification Number Date
__________________________________
Employer Fiscal Year
Scudder Fund Distributors, Inc., acknowledges receipt of a copy of the
executed Adoption Agreement and agrees to accept contributions under the Plan on
behalf of the Designated Investment Companies.
SCUDDER FUND DISTRIBUTORS
By:_________________________
-11-
<PAGE>
- --------------------------------------------------------------------------------
The Flexi-Plan has been amended for all Tax Reform changes effective in 1987 and
1988. The Adoption Agreement below has been included as part of this Tax Reform
Amendment.
- --------------------------------------------------------------------------------
ADOPTION AGREEMENT AMENDMENT
Employer Contributions in Profit Sharing Plan.
----------------------------------------------
(check the option below if you wish it to apply to your plan)
|_| Effective for Plan Years beginning on or after [_____________ fill in the
first day of the Plan Year in which this Adoption Aqreement Amendment is
executed or a subsequent anniversary of such date], notwithstanding any other
provision of the plan, the employer contributions shall be made to the plan
without regard to current or accumulated earnings and profits for the taxable
year or years ending with or within such Plan Year.
<PAGE>
Return to:
Scudder Fund Distributors, Inc.
Retirement Plan Services
175 Federal Street
Boston, MA 02210
SCUDDER FLEXI-PLAN
Money Purchase Pension Plan
Adoption Agreement
Plan number 006
The undersigned (the "Employer") establishes, or amends, the (Scudder
automatically inserts employer's name) Money Purchase Pension Plan, by
completing this Adoption Agreement adopting or amending the Money Purchase
Pension Plan in the form of the Prototype Plan attached.
I. ELIGIBILITY
A. To become a Participant an Employee must complete 3 Years of
Service
|_| or, if this box is checked, an Employee must complete
Year(s) of Service, (insert less than "3"; select more than
"1" only if the Employer selects full and immediate vesting
in Section II.A. below; insert "0" for no waiting period).
B. The number of Hours of Service required to have a Year of Service
is 1000
|_| or, if this box is checked, _____(insert less than 1000
hours). However, if the Year(s) of Service selected in A.
above is or includes a fractional year, an Employee is not
required to complete any specified number of Hours of
Service to receive eligibility credit for such fractional
year.
C. To become a Participant an Employee need not attain any minimum
age
|_| or, if this box is checked, an Employee must be at least
(insert "21" or less) years of age.
D. An Employee who meets the above requirements shall become a
Participant on the first day the requirements are met
|_| or, if this box is checked, on the first day of the next
month.
<PAGE>
E. All Employees are entitled to be Participants except (one or more
may be selected):
|_| Non-resident aliens who receive no earned income from the
Employer which constitutes income from sources within the
United States
|_| Individuals covered by a collective bargaining contract
which meets the requirements specified in the Plan
|_| Salaried Employees
|_| Hourly-paid Employees
|_| Piece-rate Employees
|_| Employees paid by commission
|_| Employees covered by another retirement plan to which the
Employer is required to contribute
|_| Employees in the following non-discriminatory
classification:
____________________________________________________________
Note: If Employees are excluded from the Plan under one or more of the
classifications above (not including the first two classifications)
the exclusion must NOT result in discrimination in favor of officers,
shareholders or highly paid Employees.
II. VESTING OF EMPLOYER CONTRIBUTIONS
A. Employer contributions under the Plan shall be fully and
immediately vested and non-forfeitable
or, check one:
|_| Vested at the "Top-Heavy" rate in Column 1 below
|_| Vested at the "4-40 vesting" rate in Column 2 below
-2-
<PAGE>
|_| Vested at the rate specified in Column 4 below, which rate
shall be at least as rapid as the rate in Column 3 below.
VESTING TABLE
Column 1 Column 2 Column 3 Column 4
Vesting "Top-Heavy" "4-40 Vesting" Minimum Percentage
Years Percentage Percentage Percentage Elected
------- ----------- ------------- ---------- ------------
1 0 0 0 ____________
2 20 0 0 ____________
3 40 0 0 ____________
4 60 40 0 ____________
5 80 45 25 ____________
6 100 50 30 ____________
7 100 60 35 ____________
8 100 70 40 ____________
9 100 80 45 ____________
10 100 90 50 ____________
11 100 100 60 ____________
12 100 100 70 ____________
13 100 100 80 ____________
14 100 100 90 ____________
15 100 100 100 ____________
B. Vesting Years and One-Year Breaks in Service for the purpose of
vesting shall be measured on the Plan Year
|_| or, if this box is checked, on the 12 consecutive month
period beginning on the Participant's initial date of
employment or anniversary of that date.
Note: If you make this election, you may not make elections in
Sections II.C. or IV.B.
C. The Participant will have a Vesting Year only if the Participant
completes the number of Hours of Service specified in Section
I.B.
|_| or, if this box is checked, if the Participant either
completes the number of Hours of Service specified in
Section I.B. or receives an allocation of the Employer
Contribution for the Plan Year, or both.
-3-
<PAGE>
D. The following Service will be included in determining Vesting
Years only if checked:
|_| Service before the first Plan Year in which the Participant
attained age 18
|_| Service before the Employer maintained this Plan or a
predecessor plan
|_| Service before January 1, 1971, unless the Participant has
completed at least 3 Vesting Years after December 31, 1970
|_| Service before the first Plan Year to which ERISA is
applicable if this Plan is a continuation of an earlier plan
which would have disregarded such service
|_| Service after five consecutive One-Year Breaks in Service
(but this exclusion shall apply only for the purpose of
computing the vested percentage of employer Contributions
made before such break)
|_| Service before a period of consecutive One-Year breaks in
Service, if the participant had no vested interest at the
time of such breaks and the number of consecutive One-Year
Breaks in Service equals or exceeds the greater of five or
the number of Vesting Years before such break without
counting Vesting Years excluded by an earlier application of
this provision.
E. If the Plan shifts out of Top-Heavy status for any Plan Year, the
vesting schedule in effect while the Plan was Top-Heavy will
continue to be in effect for all existing and future Participants
|_| or, if this box is checked, the Plan will shift to the
vesting schedule selected in Section II.A. for all Plan
Years during which the Plan is not Top-Heavy.
III. EMPLOYER CONTRIBUTIONS AND INTEGRATI0N WITH SOCIAL SECURITY
The Plan will not be integrated with Social Security, and for each
Plan Year the Employer will contribute to the Account of each
Participant entitled to an allocation under Section IV, __________%
(insert not more than 25%) of that Participant's compensation for the
Plan Year
-4-
<PAGE>
or, check and complete one:
|_| The Plan will be integrated with Social Security and for
each Plan Year, the Employer will contribute
|_| the OASDI Rate
or
|_| ___________% (not to exceed the OASDI Rate)
of such Participant's Compensation in excess of (check one)
|_| the Social Security Wage Base
or
|_| $__________ (not to exceed the Social Security
Wage Base)
Plus, an amount equal to _________% of each Participant's
Compensation for the Plan Year.
|_| The Plan will not be integrated with Social Security and for
each Plan Year the Employer will contribute an amount equal
to ___% of the aggregate Nondeductible Voluntary
Contributions made during the Plan Year by Participants
whose Nondeductible Voluntary Contributions for the Plan
Year equal or exceed ___% (insert "0" or a number not in
excess of the next chosen number) of such Participant's
Compensation, but only to the extent that such Participant's
Nondeductible Voluntary Contributions do not exceed ___%
insert "6" or less) of such Participant's Compensation.
Notes: Rates chosen should not result in total contributions to
any Participant exceeding 25% of that Employee's aggregate
compensation.
Employer contributions allocable to a Participant shall be
reduced by that Participant's allocation of forfeitures
arising during preceding Plan Years.
An Employer may elect to integrate the Plan with Social
Security only if the Employer does not maintain another
qualified retirement plan integrated with Social Security.
-5-
<PAGE>
IV. ALLOCATION OF EMPLOYER CONTRIBUTIONS
A. A former Participant who has retired, died, otherwise terminated
Service, or transferred to an ineligible class of Employees
during the Plan Year shall share in the allocation of Employer
Contributions for the Plan Year
|_| or, if this box is checked, shall not share in the
allocation of Employer Contributions.
B. Participants will share in the allocation of Employer
Contributions for a Plan Year regardless of the number of Hours
of Service completed in such Plan Year
|_| or, if this box is checked, in a Plan Year in which the Plan
is not Top-Heavy, only if they complete during such Plan
Year the number of Hours of Service specified in Section
I.B.
C. Any minimum Top-Heavy allocations of the Plan will be made first
by this Plan, unless the Employer has adopted the Scudder Profit
Sharing Plan, in which case, the minimum Top-Heavy allocation
will be made first from that plan
|_| or, if this box is checked, by the __________________Plan
(insert name of another qualified plan maintained by the
Employer).
D. In any Year in which the Plan is Top-Heavy, the minimum Top-Heavy
Allocation shall be at the rate of 3%
|_| or, if this box is checked, at the rate of 4%
V. NORMAL RETIREMENT DATE
A Participant's Normal Retirement Date shall be age 59-1/2
|_| or, if this box is checked, age_________(insert more than
59-1/2 but not more than 65).
-6-
<PAGE>
VI. COMPENSATION
"Compensation" shall include amounts paid during the Plan Year by the
Employer to the Employee while the Employee was a Participant
|_| or, if this box is checked, "Compensation" shall include
amounts paid by the Employer to the Employee during the
entire Plan Year in which an Employee became a Participant
whether or not such an Employee was a Participant for the
entire Plan Year.
|_| and, if this box is checked, "Compensation" shall not
include the following (select one or more if desired):
( ) Bonuses
( ) Commissions
( ) Overtime Payments
( ) Other (specify)_________________
Note: The above exclusions from Compensation shall only apply if
benefits under this plan are not integrated with Social
Security Benefits. Furthermore, the above exclusions must
not result in prohibited discrimination under Code Section
401(a)(4).
VII. PARTICIPANT CONTRIBUTIONS
A. Nondeductible Voluntary Contributions by a Participant are
permitted
|_| or, if this box is checked, are not permitted.
B. Deductible Voluntary Contributions (QVECs) by a Participant are
not permitted
|_| or, if this box is checked, are permitted.
VIII. INVESTMENT
Investment decisions shall be made by the Participant
|_| or, if this box is checked, by the Administrator.
-7-
<PAGE>
IX. LOANS
Loans to a Participant are not permitted
|_| or, if this box is checked, are permitted.
X. EFFECTIVE DATE
The Effective Date of this Plan or amendment shall be the first day of
the Employer's fiscal year during which the Plan is adopted or amended
|_| or, if this box is checked,____________________
(Insert date)
XI. PLAN AND LIMITATION YEARS
A. The Plan Year shall be the same as the fiscal year of the
Employer
|_| or, if this box is checked, shall end on the last day of the
month of ___________.
B. The Limitation Year shall be identical for all plans of the
Employer and is the Plan Year
|_| or, if this box is checked, shall end on the last day of the
month of ___________.
XII. AMENDMENT
Execution of this Adoption Agreement is not an amendment to an
existing plan
|_| or, if this box is checked, is an amendment to an existing
plan.
XIII. LIMITATIONS ON ALLOCATIONS
This section applies only for an employer who maintains or has ever
maintained another qualified retirement plan, other than the Scudder
Prototype Plan adopted as a Profit Sharing Plan, or a Plan amended
into the Scudder Prototype Plan, in which any Participant in this plan
is or was a Participant or could possibly become a Participant.
-8-
<PAGE>
A. If the Participant is covered under another qualified defined
contribution plan maintained by the Employer, other than a master
or Prototype Plan, the provisions of Section 5 of the Prototype
Plan will apply as if the other plan were a master or prototype
plan
|_| or, if this box is checked, the attached rider describes the
method by which the plans will limit total Annual Addition
to the Maximum Permissible Amount described in Section 5.5
of the Plan and reduce any excess amount in a manner that
precludes Employer discretion.
B. If the Participant is, or has ever been, a Participant in a
defined benefit plan maintained by the Employer, the provisions
of Section 5 of the Prototype Plan will apply
|_| or, if this box is checked, the attached rider describes the
method by which the plans involved will satisfy the 1.0
limitation described in Section 5.4 of the Plan and reduce
any excess amount in a manner that precludes Employer
discretion.
XIV. APPOINTMENT OF TRUSTEES:
The Employer hereby designates the following person or persons as
Trustee(s) under the Trust:
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
XV. SIGNATURES
The Employer (1) convenants and agrees that whenever a Participant
makes a contribution the Employer shall ascertain that the Participant
has received a copy of the current prospectus relating to the shares
of any Designated Investment Company in which such contribution is to
be invested, plus, where required by any state or federal law, the
current prospectus relating to any other investment in which
contributions are to be invested, and (2) by remitting such a
contribution to the Trustee the Employer shall be deemed to represent
that the Participant has received such a prospectus, and (3) by
remitting any other contribution to the Trustee the Employer shall be
deemed to represent that the Employer has received a current
prospectus of any Designated Investment Company in which it is to be
invested, plus, where required by any state or federal law, the
current prospectus relating to any other investment in which
contributions are to be invested.
-9-
<PAGE>
An Employer adopting this Plan may not rely on the opinion letter
issued by the National Office of the Internal Revenue Service as
evidence that this plan is qualified under Code Section 401. An
Employer who wishes to obtain such reliance should apply for a
determination letter from the appropriate Key District Director of the
Internal Revenue Service to obtain reliance that the plan is
qualified.
This Adoption Agreement may be used in conjunction with Basic Plan
Document #01.
IN WITNESS WHEREOF, the Employer has hereunto executed this Adoption
Agreement as of the _______ day of ______________, 19_____.
___________________________________ Trustee(s) Siqnature(s):
Print Name of Employer
___________________________________ ___________________________________
Signature of Employer
___________________________________ ___________________________________
Street Address
___________________________________ ___________________________________
City State Zip
___________________________________ ___________________________________
Telephone
___________________________________ ___________________________________
Employer Tax Identification Number
___________________________________ ___________________________________
Employer Fiscal Year Date
Scudder Fund Distributors, Inc., acknowledges receipt of a copy of the
executed Adoption Agreement and agrees to accept contributions under the Plan on
behalf of the Designated Investment Companies.
SCUDDER FUND DISTRIBUTORS, INC.
By:
-10-
Exhibit 14(b)
================================================================================
Scudder IRA
Plan
and
Disclosure
Statement
================================================================================
Scudder IRA Form 1-88
Scudder
Individual Retirement Custodial Account
(Under Section 408(a) of the Internal Revenue Code)
The Depositor whose name appears on the Scudder Application is establishing
an individual retirement account (under section 408(a) of the Internal Revenue
Code) to provide for his or her retirement and for the support of his or her
beneficiaries after death.
The Custodian named on the Application has given the Depositor the
disclosure statement required under the Income Tax Regulations under section
408(a) of the Code.
The Depositor has deposited with he Custodian the amount indicated on the
Application.
The Depositor and the Custodian make the following agreement:
Article I
- --------------------------------------------------------------------------------
The Custodian may accept additional cash contributions on behalf of the
Depositor for a tax year of the Depositor. The total cash contributions are
limited to $2,000 for the tax year unless the contribution is a rollover
contribution described in section 402(a)(5), 402(a)(7), 403(a)(4), 403(b)(8),
408(d)(3) of the code or an employer contribution to a simplified employee
pension plan as described in section 408(k).
<PAGE>
Article II
- --------------------------------------------------------------------------------
The Depositor's interest in the balance in the custodial account is
nonforfeitable.
Article III
- --------------------------------------------------------------------------------
1. No part of the custodial funds may be invested in life insurance
contracts, nor may the assets of the custodial account be commingled with other
property except in a common trust fund or common investment fund (within the
meaning of section 408(a)(5) of the Code).
2. No part of the custodial funds may be invested in collectibles (within
the meaning of section 408(m) of the Code).
Article IV
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1. The Depositor's entire interest in the custodial account must be or
begin to be, distributed by the Depositor's required beginning date, the April 1
following the calendar year end in which the Depositor reaches age 70 1/2. By
that date, the Depositor may elect, in a manner acceptable to the Custodian, to
have the balance in the custodial account distributed in:
(a) A single sum payment.
(b) An annuity contract that provides equal or substantially equal
monthly, quarterly, or annual payments over the life of the Depositor.
The payments must begin by the April 1 following the calendar year in
which the Depositor reaches age 70 1/2.
(c) An annuity contract that provides equal or substantially equal
monthly, quarterly, or annual payments over the joint and last
survivor lives of the Depositor and his or her designated beneficiary.
The payments must begin by the April 1 following the calendar year in
which the Depositor reaches age 70 1/2.
(d) Equal or substantially equal annual payments over a specified period
that may not be longer than the Depositor's life expectancy
(e) Equal of substantially equal annual payments over a specified period
that may not be longer than the joint life and last survivor
expectancy of of Depositor and his or her designated beneficiary.
Even if distributions have begun to be made under option (d) or (e), the
Depositor may receive a distribution of the balance in the custodial account at
any time by giving written notice to the Custodian. If the Depositor does not
choose any of the methods of distribution described above by the April 1
following the calendar year in which he or she reaches age 70 1/2, distribution
to the Depositor will be made on that date by a single sum payment. If the
Depositor elects as a means of distribution (b) or (c) above, the annuity
contract must satisfy the requirements of section 408(b)(1), (3), and (4) of the
Code. If the Depositor elects as a means of distribution (d) or (e) above, the
annual payment required to be made by the Depositor's required beginning date is
for the calendar year the Depositor reached age 70 1/2. Annual payments for
subsequent years, including the year the Depositor's required beginning date
occurs, must be made by December 31 of that year.
2. If the Depositor dies before his or her entire interest is distributed
to him or her, the entire remaining interest will be distributed as follows:
(a) If the Depositor dies on or after the Depositor's required beginning
date, distribution must continue to be made in accordance with
paragraph 1.
(b) If the Depositor dies before the Depositor's required beginning date,
the entire remaining interest will, at the election of the beneficiary
or beneficiaries, either
(i) Be distributed by the December 31 of the year containing the
fifth anniversary of the Depositor's death.
or
(ii) Be distributed in equal or substantially equal payments over the
life or life expectancy of the designated beneficiary or
beneficiaries.
The election of either (i) or (ii) must be made by December 31 of the year
following the year of the Depositor's death. If the beneficiary or beneficiaries
do not elect either of the distribution options described in (i) and (ii),
distribution will be made in accordance with (ii) if the beneficiary is the
Depositor's surviving spouse and in accordance with (i) if the beneficiary or
beneficiaries are or include anyone other than the surviving spouse. In the case
of distributions under (ii), distributions must commence by December 31 of the
year following the year of the Depositor's death. If the Depositor's spouse is
the beneficiary, distributions need not commence until December 31 of the year
the Depositor would have attained age 70 1/2, if later.
(c) If the Depositor dies before his or her entire interest has been
distributed and if the beneficiary is other than the surviving spouse,
no additional cash contributions or rollover contributions may be
accepted in the account.
3. In the case of distribution over life expectancy in equal or
substantially equal annual payments, to determine the minimum annual payment for
each year, divide the Depositor's entire interest in the custodial account as of
the close of business on December 31 of the preceding year by the life
expectancy of the Depositor (or the joint life and last survivor expectancy of
the Depositor and the Depositor's designated beneficiary, or the life expectancy
of the designated beneficiary, whichever applies). In the case of distributions
under paragraph (1), determine the initial life expectancy (or joint life and
last survivor expectancy) using the attained ages of the Depositor and
designated beneficiary as of their birthdays in the year the Depositor reaches
age 70 1/2. In the case of distribution in accordance with paragraph (2)(b)(ii),
determine life expectancy using the attained age of the designated beneficiary
as of the beneficiary's birthday in the year distributions are required to
commence. Unless the Depositor (or spouse) elects not to have life expectancy
recalculated, the Depositor's life expectancy (and the life expectancy of the
Depositor's spouse, if applicable) will be recalculated annually using their
attained age as of their birthdays in the year for which the minimum annual
payment is being determined. The life expectancy of the designated beneficiary
(other than the spouse) will not be recalculated. The minimum annual payment may
be made in a series of installments (e.g. monthly, quarterly, etc.) as long as
the total payments for the year made by the date required are not less than the
minimum amounts required.
Article V
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Unless the Depositor dies, is disabled (as defined in section 72(m) of the
Code), or reaches age 59 1/2 before any amount is distributed from the custodial
account, the Custodian must receive from the Depositor a statement explaining
how he or she intends to dispose of the amount distributed.
Article VI
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1. The Depositor agrees to provide the Custodian with information necessary
for the Custodian to prepare any reports required under section 408(i) of the
Code and related regulations.
2. The Custodian agrees to submit reports to the Internal Revenue Service
and the Depositor prescribed by the Internal Revenue Service.
<PAGE>
Article VII
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Notwithstanding any other article which may be added or incorporated, the
provisions of Articles I through III and this sentence will be controlling. Any
additional articles that are not consistent with section 408(a) of the Code and
related regulations will be invalid.
Article VIII
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This agreement will be amended from time to time to comply with the
provisions of the Code and related regulations. Other amendments may be made
with the consent of the persons whose signatures appear on the Application.
Article IX
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1. Please refer to Scudder IRA Application which is incorporated herein by
reference.
2. Depositor's Selection of Investments
Depositor directs Custodian to invest all custodial funds in investment
shares issued by the "Mutual Funds(s)," or in the other investments which have
been designated by Scudder Fund Distributors, Inc. (or its successors) as
eligible for investment hereunder, which have been selected by Depositor until
Depositor hereafter gives custodian contrary instructions pursuant to Article
IX, paragraph ("para.") 6 below, which governs investment of the custodial
account in "Mutual Fund" shares or other investment.
3. Contributions
(a) Periodic Contributions. Periodic contributions which Depositor intends
to be tax-deductible under Internal Revenue Code Section 219 shall be in cash
and are to be invested under this Agreement. Depositor contemplates future
periodic contributions within the tax-deductible limits and in accordance with
the rules for tax-deductibility specified in the Internal Revenue Code.
Depositor assumes full and sole responsibility for making sure that the sum of
periodic contributions during a single taxable year of Depositor does not exceed
those limits or violate those rules. Depositor should not contribute to the
custodial account after it ceases to be exempt by reason of either section
408(e) or 415(g) of the Internal Revenue Code.
(b) Rollover Contributions From an Individual Retirement Account or
Individual Retirement Annuity Funded Exclusively With Deductible Contributions.
A rollover contribution by Depositor from an individual retirement account or
individual retirement annuity funded exclusively with deductible contributions
shall be a deposit in cash to be invested under this agreement, with respect to
which contribution, Depositor warrants that
(1) it meets the requirements for a rollover contribution from such an
individual requirement account or individual retirement annuity as are contained
in Code Section 408(d) and that
(2) no portion of such rollover contribution is attributable to a distribution
from an employee's trust, an employee annuity, an annuity contract or a U.S.
retirement bond as described in Internal Revenue Code Sections 402(a)(5),
403(a)(4), 403(b)(8), 405(d)(3), or 409(c)(3)(C).
(c) Rollover Contributions Attributable to Distributions From Employer
Plans. A rollover contribution by Depositor other than a contribution described
in paragraph (b) above shall be a deposit in cash to be invested under this
Agreement with respect to which contribution Depositor warrants that 91) the
amount rolled over is attributable to a distribution from an employees' trust,
an employee annuity, an annuity contract, a qualified bond purchase plan, or a
U.S. retirement bond, which meets the requirements of Code section 402(a)(5),
403(a)(4), 403(b)(8), 405(d)(3), or 409(b)(3)(C); and (2) Depositor will make no
additional contributions to the custodial account in which such contribution is
deposited, except as other wise permitted by Scudder Fund Distributors, Inc.
If permitted by Scudder Fund Distributors, Inc. rollover contributions may
be received under this Agreement with respect to qualified voluntary employee
contributions as defined in Internal Revenue Code Section 219(e)(2) and such
contributions shall thereafter be held and administered hereunder by the
Custodian in accordance with all applicable law with respect to accumulated
deductible employee contributions as defined in Internal Revenue Code Section
72(g)(5)(B).
(d) Transfer from an Individual Retirement Account or Individual Retirement
Annuity. Depositor may make an opening contribution hereunder by directing the
transfer of a cash amount from a custodian or trustee or an individual
retirement account or individual retirement annuity to the Custodian be made for
investment under this Agreement.
(1) From IRA Funded with Deductible Contributions. Where no portion of such
transferred amount is attributable to a distribution from an employees
trust, an employee annuity, an annuity contract or a U.S. retirement bond
as described in Internal Revenue Code Sections 402(a)(5), 403(a)(4),
403(b)(8), 405(d)(3), or 409(b)(3)(C). Depositor warrants that Depositor
did not inherit the account or annuity, or if Depositor did inherit the
account or annuity, that Depositor is the surviving spouse of the
individual for whose benefit the account was originally maintained or the
annuity was originally purchased.
(2) From IRA Funded with Distributions Attributable to an Employer Plan.
With respect to any other transferred amount, Depositor:
(A) agrees that no additional contributions will be made to the
custodial account in which such contribution is deposited except as
otherwise permitted by Scudder Fund Distributors Inc.
(B) that the entire amount of such transferred amount is attributable
to a distribution from an employees trust, an employee annuity, an
annuity contract, a qualified bond purchase plan, or a U.S. retirement
bond, as described in Internal Revenue Code Sections 402(a)(5),
403(a)(4), 403(b)(8), 405(d)(3), 409(b)(3)(C), or other applicable
law;
(3) that if the transferred amount had been a rollover contribution it
would have complied with he requirements of subparagraph (b) or (c) above.
4. Tax Reform Act of 1986
Notwithstanding anything to the contrary herein, the provisions of this
agreement are to be interpreted in accordance with the provisions of the
Internal Revenue Code of 1986, to the extent any provisions of this agreement
conflicts with the provisions of the Internal Revenue Code of 1986, it shall be
deemed to have been amended in such manner as best preserves the original intent
of the unamended provision of the agreement while also bringing the provision
into compliance with the relevant provision(s) of the Internal Revenue Code of
1986.
5. Custodian's Fees
(a) Custodian shall be entitled to receive such reasonable fees with
respect to the establishment and administration of this custodial account as are
established by it from time to time.
(b) Upon thirty (30) days prior written notice. Custodian may change its
fee schedule.
Custodian's fees, any income, gift, estate and inheritance taxes or other
taxes of any kind whatsoever, including transfer taxes incurred in connection
with the investment or reinvestment of the assets of the custodial account, that
may be levied or assessed in respect to such assets and all other administrative
expenses incurred by Custodian in the performance of its duties including fees
for legal services rendered to Custodian, may be charged to the custodial
account, with the right to liquidate Mutual Fund shares or other investments for
this purpose or Custodian's options to the Depositor.
<PAGE>
6. Custodial Account
(a) This Agreement shall take effect only when accepted and signed by
Custodian. As directed, Custodian shall then open and maintain a separate
custodial account for Depositor and invest the initial contribution hereunder in
shares of the Mutual Fund(s) or other investments selected by Depositor in
Article IX Para 1. "Mutual Fund" means a regulated investment company which is
defined in Internal Revenue Code Section 851(a) and which has been designated by
Scudder Fund Distributors, Inc. (or its successors) as appropriate for
investment hereunder.
(b) Every subsequent contribution shall be invested in accordance with
instructions authorized by Depositor indicating Depositor's choice of the Mutual
Funds or other investments designated by Scudder Fund Distributors, Inc. (or its
successors) as appropriate for investment hereunder. Depositor agrees that the
listing shall not be construed as an endorsement by Custodian of the Mutual
Funds or other investment in which contributions may be invested, final choice
of which is in the sole discretion of Depositor. The Custodian does not
undertake to render any investment advice whatsoever to Depositor; its sole
duties are those prescribed in Article IX, para. 8(c).
(c) The Custodian shall invest subsequent contributions as directed.
However, if any such instructions authorized by Depositor are not received as
required, or if received, are in the opinion of Custodian unclear, or if the
accompanying contribution would cause the Depositor to exceed the maximum
limitation on tax deductibility. Custodian may hold or return all or a portion
of the contribution uninvested without liability for loss of income or
appreciation or for other loss, and without liability for interest, pending
receipt of written instructions or clarification.
(d) All dividends and capital gains distributions received on shares of a
Mutual Fund held in the custodian account shall (unless received in additional
such shares be reinvested in shares of that Mutual Fund, if available, which
shall be credited to the account. If any distribution on such shares may be
received at the election of the shareholder in additional such shares or in cash
or other property. Custodian shall elect to receive it in additional such
shares. All accumulations on account of other investments shall be reinvested in
Depositor's custodial account.
(e) All Mutual Fund shares or other investments acquired by Custodian
hereunder shall be registered in the name of Custodian (with or without
identifying Depositor) or of its nominee. Custodian shall deliver, or cause to
be executed and delivered, to Depositor all notices, prospectuses, financial
statements, proxies, and proxy soliciting materials relating to such Mutual
Funds shares or other investments held in the custodial account. Custodian shall
not vote any such Mutual Fund shares or other investments except in accordance
with any written instructions received from Depositor.
7. Distributions
(This paragraph 7 supplements Article IV on Scudder IRA Form 12-86 of the
Agreement and must be read in conjunction with it.)
(a) Distribution of the custodial account assets in accordance with Article
IV shall be made in a manner set forth in subparagraph (c)(1) or (2), whichever
applies, except as Article IV otherwise requires and at such time as Depositor
(or Depositor's Beneficiary if Depositor is deceased) shall elect by written
order to Custodian, provided that distribution (except for distribution on
account of Depositor's disability or death, return of an "excess contribution"
referred to in subparagraph (d) or a "rollover" from this account), must be no
earlier than age 59 1/2 if Depositor wants to avoid an "early distribution
additional tax" under Code section 408(f) or other applicable law. For that
purpose, Depositor will be considered disabled if Depositor can prove, as
provided in Code section 72(m)(7), that Depositor is unable to engage in any
substantial gainful activity by reason of any medically determinable physical or
mental impairment which can be expected to result in death or be of
long-continued and indefinite duration. Depositor's (or Depositor's Beneficiary
if Depositor is deceased) will order distribution in the manner and at the time
permitted or required by Article IV and this paragraph. Custodian assumes no
responsibility for the tax treatment of any distribution from the custodial
account, such responsibility accrues solely to person ordering the distribution.
(b) Custodian assumes (and shall have) no responsibility to make any
distribution on order of Depositor (or Depositor's Beneficiary if Depositor is
deceased) unless and until such order specifies the occasion for such
distribution, the elected manner of distribution and any declaration required by
Article V. Also, before making any such distribution or before honoring any
assignment of the custodial account. Custodian shall be furnished with any and
all applications, certificates, tax waivers, signature guarantees, and other
documents (including proof of any legal representative's authority) deemed
necessary or advisable by Custodian, but Custodian shall not be responsible for
complying with an order which appears on its face to be genuine, or for refusing
to comply if not satisfied it is genuine, and assumes no duty of further
inquiry.
(c) Upon receipt of a proper written order as required above Custodian
shall distribute the assets of the custodial account in cash or kind as follows:
(1) Distribution to Depositor. If the distribution order calls for the
custodial account to be paid to Depositor under Article IV then
distribution shall be made in one or more of the following ways as
specified in the order.
(A) In a lump sum.
(B) In installments pursuant to a cash withdrawal plan, provided that
such a plan suitable for prearranging the distributions described in
this subparagraph (b) is available for Custodian's use under the rules
governing the investments held in the custodial account. A suitable
cash withdrawal plan will provide for periodic liquidation of some of
investments held in the custodial account to yield the cash necessary
to pay each installment. Prior to January 1, 1985, a suitable cash
withdrawal plan will provide for payment of installments over a period
not longer than the life expectancy of Depositor or the joint life and
the last survivor expectancy of Depositor and Depositor's spouse.
Subsequent to December 31, 1984, a suitable cash withdrawal plan will
provide for payment of installments ratably over a period of not
longer than the life expectancy of the Depositor or the joint life and
last survivor expectancy of the Depositor and the Depositor's
Beneficiary (as defined in subparagraph (c)(2) of this Para. 7). The
life expectancies referred to in this Agreement shall be determined by
using applicable Internal Revenue Service tables. The amount
distributed each year shall be at least equal to the quotient obtained
by dividing the entire custodial account remaining at the beginning of
that year by the adjusted life expectancy of Depositor, the joint life
and last survivor expectancy of Depositor and Depositor's spouse, or
the joint life and last survivor expectancy of Depositor's Beneficiary
(whichever is applicable). Prior to January 1, 1985 the life or joint
life and last survivor expectancy used to calculate the minimum amount
to be distributed in a given year shall be equal to the relevant
expectancy as it was determined as of when Depositor attained age 70
1/2 reduced by the number of whole years elapsed, if any, since
Depositor attained age 70 1/2. Subsequent to December 31, 1984, the
adjusted life of joint life and last survivor expectancy used to
calculate the minimum amount to be distributed in a given year shall
be at the Depositor's election, either determined by referring to the
<PAGE>
applicable Internal Revenue Service table and determining the relevant
expectancy as of the particular year in question of by using a
previously determined expectancy and reducing such expectancy by the
number of whole years elapsed since it was determined. Notwithstanding
any implication to the contrary in this subsection (B) no distribution
need be made in any year or a lesser amount may be distributed during
such year if the aggregate amounts distributed through the end of such
year are at least equal to the aggregate of the minimum amounts
required by this subparagraph (B) to have been distributed. Moreover,
during Depositor's lifetime the entire custodial account remaining for
distribution at any time under this subparagraph (B) may, pursuant to
proper supplementary written order as specified above be distributed
to Depositor.
(C) By the purchase and distribution of a single-premium contract
meeting the requirements of Code section 408(b)(1), (3), (4) and,
prior to January 1, 1985, (5) applicable to an "individual retirement
annuity."
(2) Distribution upon Death of Depositor or Depositor's Spouse. Prior to
January 1, 1985, if Custodian receives a proper written order for
distribution on account of the Depositor's death or the spouse's death, if
distributions were being made to the spouse over the joint life and last
survivor expectancy. Custodian shall distribute the then-remaining
custodial account to Depositor's (or, if applicable, the spouse's)
Beneficiary within five (5) years of Depositor's (or, if applicable, the
spouse's) death either in a lump sum or installments; provided, however,
that if distributions have already begun before Depositor's death for a
specified term, then Custodian may instead continue to make the
distribution in the same manner and without regard to the foregoing
five-year limitation; provided further, that if Depositor's Beneficiary is
Depositor's spouse and if Depositor's Beneficiary elects to treat the
account as if Depositor's Beneficiary were the Depositor, then the
Custodian may distribute the account as directed by the Depositor's
Beneficiary as if such person were the Depositor and in accordance with the
Articles IV and IX. Subsequent to December 31, 1984, if Custodian receives
a proper written order for distribution on account of the Depositor's death
or the spouse's death, if distributions were being made to the Depositor's
surviving spouse, then the Custodial shall distribute the then-remaining
custodial account to the Depositor's (or, if applicable, the spouse's)
Beneficiary over the life of the Depositor's (or, if applicable, the
spouse's) Beneficiary or within a period not greater than the greater of
five (5) years after the Depositor's (or, if applicable, the spouse's)
death or the life expectancy of Depositor's (or, if applicable, the
spouse's) Beneficiary; provided, however, that if distributions have
already begun before Depositor's death for a specified term. Custodian
shall continue to distribute the custodial account over a period at least
as rapid as that specified term. The term "Depositor's Beneficiary" means
the person or persons designated as such by the "designating person" (as
defined below) on a form acceptable to Custodian for use in connection with
this Agreement, signed by the designating person, and filed with the
Custodian in accordance with this subparagraph (2). The form may name
persons or estates to take upon the contingency of survival. However, the
term "Depositor's Beneficiary" means the designating persons estate to the
extent no such designation on such a form effectively disposes of the
custodial account as of when such distribution is to commence. Moreover, a
form shall not become effective for that purpose until it is filed with the
Custodian during the lifetime of the designating person. The term last
accepted by Custodian before such distribution is to commence upon becoming
effective during the designating person's lifetime, shall be controlling
and, whether or not fully dispositive of the custodial account, thereupon
shall revoke all such forms previously filed by that person. The term
"designating person" means Depositor; after Depositor's death, it also
means the person or persons (other than Depositor's estate) who begin to
receive a portion of the custodial account pursuant to such a designation
by Depositor and designations by such a person shall relate solely to the
balance of that portion remaining in the custodial account as of when
distribution pursuant to a designation by that person is to commence. The
Custodian shall accept all such forms only in the Commonwealth of
Massachusetts and they shall be considered part of this Agreement for
purposes of Article IX, para. 13(c).
(3) Any annuity which Custodian is to purchase and distribute under this
Agreement may be filed or variable, but Custodian shall not be required to
distribute in that manner unless the premium for that annuity is at least
$1,000.
(4) Depositor's beneficiary shall not have the right or power to anticipate
any part of the custodial account or to sell, assign, transfer, pledge or
hypothecate any part thereof. The custodial account shall not be liable for
the debts of Depositor's Beneficiary or subject to any seizure, attachment,
execution or other legal process in respect thereto.
(d) If during a taxable year under Article I a total amount as contributed
which exceeds the amount deductible for that year, either because such amount
exceeds the tax-deductible limits specified in the Internal Revenue Code, or
because of attainment of age 70 1/2 in that year, or for some other reason, then
upon receiving written notice specifying the year in question, the amount of the
excess, the reason it is an excess, and the amount of net income in the
custodial account attributable to such excess -- Custodian shall distribute cash
to Depositor in an amount equal to the sum of such excess and earnings. if the
excess Custodian's discretion unless otherwise instructed by depositor in lieu
of being distributed, said sum shall be treated by Depositor as a contribution
in the then current or a succeeding taxable year, in accordance with applicable
law.
8. Additional Provisions Regarding the Custodian
(a) When and after distributions of the custodial account to Depositor's
Beneficiary commence, all rights and obligations assigned to Depositor by
provisions of this Agreement shall inure to and be enjoyed and exercised by,
Depositor's beneficiary instead of Depositor. Until such distributions commence
to such a person, the Custodian shall not be responsible for treating such
person's predecessor to such rights and obligations as still possessing the
same.
(b) Custodian shall keep adequate records of transactions it is required to
perform hereunder. Not later than sixty (60) days after the close of each
calendar year or after the Custodian's resignation or removal pursuant to
Article IX, para. 10(1). Custodian shall render to Depositor a written report or
reports reflecting the transactions effected by it during such period and the
assets of the custodial account at the close of the period. Sixty (60) days
after rendering such report(s), Custodian shall be forever released and
discharged from all liability and accountability to anyone with respect to its
acts and transactions known in or reflected by such report(s), except with
respect to those as to which the recipient of such report(s) shall have filed
written objections with the Custodian within the latter such sixty-day period.
<PAGE>
(c) Custodian shall be an agent for Depositor to receive and invest
contributions as authorized by Depositor, hold and distribute such investments
and keep adequate records and report thereon, all in accordance with this
Agreement. The parties do not intend to confer any fiduciary duties on Custodian
and none shall be implied. Custodian may perform any of its administrative
duties through other persons designated by Custodian from time to time, except
the Mutual Fund shares or other investments must be registered as stated in
para. 6(e) of this Article IX and Custodian intends initially to delegate all
such duties to Boston Financial Data Services, Inc., which is partially owned by
Custodian' s parent company, but no such delegation or future change therein
shall not be liable (and assumes no responsibility) for the collection of
contributions, the deductibility of any contribution or its propriety under this
Agreement or the purpose or property of any distribution ordered in accordance
with Article IX, para. 7, or made in accordance with Article IX, para. 12. which
matters are the sole responsibility of Depositor and Depositor's Beneficiary.
(d) Depositor shall always fully indemnify Custodian and save it harmless
from any and all liability whatsoever which may arise either (1) in connection
with this Agreement and matters which it contemplates, except that which arised
due to Custodian's negligence or willful misconduct, or (2) with respect to
making or failing to make any distribution, other than for failure to make
distribution in accordance with any order therefor which is in full compliance
with both Article IV and para. 7(a) and (b) of Article IX. Custodian shall not
be obligated or expected to commence or defend any legal action or proceeding in
connection with this Agreement or such matters unless agreed upon by Custodian
and Depositor, and unless fully indemnify for so doing to Custodian's
satisfaction.
(e) Custodian may conclusively rely upon and shall be protected in acting
upon any written order from or authorized by Depositor or Depositor's
beneficiary or any other notice, request, consent, certificate or their
instrument, paper, or other communication believed by it to be genuine, and to
have been issued in proper form and with proper authority and, so long as it
acts in good faith, in taking or omitting to take any other action in reliance
thereon.
9. Amendment
(This paragraph 9 supplements Article VIII on Scudder IRA Form 12-86 of the
Agreement and must be read in conjunction with it.)
(a) Depositor retains the right to amend this Agreement in any respect at
any time effective on a stated date which shall be at least sixty (60) days
after giving written notice of the amendment (including its exact terms) to
Custodian by registered or certified mail unless Custodian waives such notice as
to that amendment. If Custodian does not wish to continue serving in that
capacity under this Agreement as so amended, it may resign in accordance with
Article IX, para. 10. Depositor also delegates, to the distributor (principal
underwriter) of a plurality of the Mutual Funds described in Article IX, para.
6(b), Depositor's right so to amend, including retroactively, as necessary or
appropriate in the opinion of counsel satisfactory to the distributor, in order
to conform with pertinent provisions of the Code and other laws or successor
provisions of law or to obtain a governmental ruling that such requirements are
met, to adopt a prototype or master plan (when one becomes available) for
investment in shares of such Mutual Funds or other investment, or as otherwise
may be advisable in the opinion of such counsel provided the distributor amends
in the same manner all agreements comparable to this one, having the same
Custodian, permitting investment in shares of such Mutual Funds or other
investments, and under which such power has been delegated to it. Such an
amendment by the distributor shall be communicated in writing to Depositor and
Custodian and Depositor shall be deemed to have consented thereto unless, within
thirty (30) days after such communication to Depositor is mailed. Depositor
either (1) gives Custodian a proper written order for a lump-sum distribution of
the custodial account, or (2) removes Custodian and simultaneously appoints a
Successor Custodian under Article IX, para. 1.
(b) This paragraph 9 shall not be construed to restrict Custodian's freedom
to agree with distributors of Mutual Fund shares, or others, upon the terms by
which shares of additional Mutual Funds or other investments may be chosen for
investment as contemplated in Article IX, para. 6(b), or Custodian's freedom to
change fee schedules in the manner approved by Article IX, para. 5(b), and no
such agreement or change shall be deemed to be an amendment of this Agreement.
10. Resignation or Removal of Custodian
(a) Custodian may resign at any time upon at least thirty (30) days prior
notice in writing to Depositor, and may be removed by Depositor at any time upon
at least thirty (30) days prior notice in writing to Custodian. Upon such
resignation or removal, Depositor shall appoint a Successor Custodian to serve
under this Agreement. Upon receipt by Custodian of written acceptance of such
appointment by the Successor Custodian, Custodian shall transfer to such
Successor the assets of the custodial account and all necessary records (or
copies thereof) pertaining thereof, provided that (if so requested by Custodian)
any Successor Custodian agrees not to dispose of any such records without
Custodian's consent. Custodian is authorized, however, to reserve such a portion
of such assets as it may deem advisable for payment of all its fees,
compensation, costs, and expenses, or for payment of any other liabilities
constituting a charge on or against Custodian, with any balance of such reserve
remaining after the payment of all such items to be paid over to the Successor
Custodian.
(b) If within thirty (30) days after Custodian's resignation or removal or
such longer time as Custodian may agree to, Depositor has not appointed a
Successor Custodian which has accepted such appointment, Custodian shall
terminate the custodial account pursuant to Article IX, para. 11, unless within
that time the distributor referred to in Article IX, para. 9(a), appoints such
Successor and gives written notice thereof to Depositor and Custodian.
(c) Custodian shall not be liable for the acts or omissions of such
Successor.
(d) The Custodian, and every Successor Custodian appointed to serve under
this Agreement, must be a bank as defined in Code section 408(n) or such other
person who qualifies to serve in the manner prescribed by Code section 408(a)(2)
and satisfies the Depositor, distributor or Custodian, upon request, as to such
qualification.
(e) After Custodian has transferred the custodial account assets (including
any reserve balance as contemplated above) to the Successor Custodian, Custodian
shall be relieved of all further liability with respect to this Agreement, the
custodial account, and the assets thereof.
11. Termination of Account
(a) Custodian shall terminate the custodial account if within the time
specified in Article IX, para. 10(b), after Custodian's resignation or removal,
neither Depositor nor the distributor has appointed a Successor Custodian which
has accepted such appointment. Termination of the custodial account shall be
effected by distributing all assets thereof in a lump sum in cash or in kind to
Depositor subject to Custodian's right to reserve funds as provided in Article
IX, para 10(a).
<PAGE>
(b) Upon termination of the custodial account, this Agreement shall
terminate and have no further force and effect, and Custodian shall be relieved
from all further liability with respect to this Agreement, the custodial
account, and all assets thereof so distributed.
12. Liquidation of Account
(a) Notwithstanding anything contained in this Agreement to the contrary,
Scudder Fund Distributors, Inc. shall have the right to direct Custodian, by
written order to Custodian, to liquidate the custodial account if the value of
the account at the time of such written order is less than a minimum value
established on a non-discriminatory basis from time to time by Scudder Fund
Distributors, Inc., and upon receipt of such written order (which Scudder Fund
Distributors, Inc. shall have no duty to make and which, if made, may be made
with respect to any specified accounts as to which it may be made applicable
singly or to all accounts as to which it may be made applicable as a group),
Custodian shall forthwith proceed to liquidate the custodial account by
distributing all assets thereof in a lump sum in cash or in kind to Depositor,
subject to Custodian's right to reserve such a portion of such assets as it may
deem advisable for payment of all its fees, compensation, costs, and expenses,
or for payment to any other liabilities constituting a charge on or against the
assets of the custodial account or on or against Custodian, with any balance of
such reserve remaining after the payment of all such items to be paid over to
Depositor.
(b) Neither Scudder Fund Distributors, Inc. nor Custodian shall be liable
for, or in any way responsible with respect to, any penalty or any other loss
incurred by any person with respect to a distribution made hereunder and upon
liquidation of the custodial account as aforesaid, this Agreement shall
terminate and have no further force and effect, and Custodian and Scudder Fund
Distributors, Inc. shall be relieved from all further liability with respect to
this Agreement, the custodial account, and all assets thereof so distributed.
13. Miscellaneous
(a) References herein to the "Internal Revenue Code" or "Code" and sections
thereof shall mean the same as amended from time to time hereafter, including
successors to such sections.
(b) Except where otherwise specifically required in this Agreement, any
notice from Custodian to any person provided for in this Agreement shall be
effective if sent by first-class mail to such person at that person's last
address on Custodian's records.
(c) This agreement is accepted by Custodian in, and shall be construed and
administered in accordance with the laws of the Commonwealth of Massachusetts.
This Agreement is intended to qualify under section 408 of the Code as an
Individual Retirement Account and for the Retirement Savings deduction under
section 219 of the Code, and if any provision hereof is subject to more than one
interpretation or any term used herein is subject to more than one construction
which is consistent with that intent. However, neither the Custodian nor any
Mutual Fund (or company associated therewith) shall be responsible for whether
or not such intentions are achieved through use of this Agreement and Depositor
is referred to depositor's attorney for any such assurances.
CUSTODIAN
DISCLOSURE STATEMENT
The following information is being provided to you by the State Street Bank
and Trust Company, the Custodian of the Scudder Individual Retirement Accounts,
in accordance with the requirements of the Internal Revenue Service. Please read
it together with the Individual Retirement Plan and the prospectus for the
shares of each Mutual Fund selected by you for the investment of your
contributions to that Plan, copies of which you should have already received
from the distributor of those shares. The provisions of the Plan and prospectus
must prevail over this statement in any instance where the statement is
incomplete or appears to conflict.
The Employee Retirement Income Security Act of 1974 has provided an
entirely new program that may enable you to plan for your retirement by creating
a "retirement plan" with federally tax-deductible dollars. This federal income
tax deduction is available even if you do not otherwise itemize your deductions.
In addition, any earnings on the assets held in your individual retirement
account will not be subject to federal income tax until you actually begin to
receive a distribution from your account. The state income tax treatment of your
account may differ, and details should be available from your state taxing
authority or your own tax adviser.
As with most other laws that provide special tax treatment, there are
certain restrictions and limitations involved with respect to your individual
retirement account:
1. Only a limited amount of savings can qualify for the preferential tax
treatment -- 100% of your compensation or earnings from
self-employment up to an annual maximum of $2,000.
Undercertain conditions, an individual and his or her unemployed
spouse, or employed spouse with less than $250 of earnings, may each
open an IRA.
Annual deductions for contributions are allocable if a joint income
tax return is field and the deductions are limited to the lesser of
100% of the employed spouse's wages or $2,250, and the amount
contributed to either individual retirement account may not exceed
$2,000.
In the case of an individual retirement account which meets the
requirements of a so-called Simplified Employee Pension Plan, an
employer may contribute a deductible amount equal to 15% of the
employee's compensation up to an annual maximum of $30,000. The amount
of such contribution is includible in the employee's income as wages
(for federal income tax purposes) but is deductible by him or her. The
employee is also allowed an annual deduction for his or her own
individual retirement account contributions limited to the lesser of
100% of the employee's compensation of $2,000.
There is a 6% penalty tax on any so-called "excess contribution" if
you make one, that is, on the portion of a contribution made to your
IRA in excess of the amount which can be currently deducted. Some
examples of when this can occur are when you make a contribution to
your IRA in excess of the allowable deduction limitations, or you
contribute during or after the calendar year in which you reach 70
1/2. The 6% penalty tax on any "excess contribution" also attaches for
each following year until the excess is withdrawn or used up in an
excess contribution plus earnings on it is withdrawn before the time
for filing the individual's tax return for the year of the
contribution (including extensions), there will be no 6% penalty tax.
The amount withdrawn will not be considered a premature distribution
<PAGE>
nor taxes as ordinary income, except the earnings withdrawn will be
included in the income of the taxpayer. In addition, in certain cases
an excess contribution may be withdrawn after the time for filing the
individual's tax return without resulting in taxable income to the
individual. Also, excess contributions for one year may be carried
forward and deducted in the next year.
2. Contributions must be made to a Trust or Custodial Account in which
the Trustee Custodian is either a bank or such other person who has
been approved by the Secretary of the Treasury. No part of your
contribution may be invested in life insurance or be commingled with
other proiperty except in a common trust fund or common investment
fund.
3. No deduction is allowed for (a) contributions other than in cash; (b)
contributions (other than those by an employee to a Simplified
Employer Pension Plan) made during your calendar year in which you
attain age 70 1/2 or thereafter; or (c) for any amount you contribute
which was a distribution from another retirement plan ("rollover"
contribution). However, the limitations in paragraph 1 do not apply to
such rollovers.
4. Individuals receiving compensation may establish their own individual
retirement accounts even if they are already covered under
tax-qualified plans (including Keogh plans for self-employed
individuals), government plans, or certain annuities.
5. Your interest in the account must be nonforfeitable at all times.
6. An individual is allowed to transfer, or rollover, such individual's
investment in one type of individual retirement plan to another
without any tax liability. Also, under certain conditions, an
individual may roll over (tax-free) a distribution received from a
qualified plan or a tax sheltered annuity. However, strict limitations
apply to such rollovers, and you should seek a competent tax advice in
order to comply with all the rules governing rollovers.
7. Since the purpose of the IRA savings plan is to accumulate funds for
retirement, your receipt or use of any portion of this account (for
example, as collateral for a loan) before you attain age 59 1/2 would
be considered as an early distribution unless the distribution is a
result of death or disability. The amount of an early distribution
would be includible in your gross income and would also subject you to
a penalty tax equal to 10% of the distribution unless you transfer it
to another IRA under circumstances whereby it qualifies as a rollover.
8. If you or your beneficiary were to engage in any prohibited
transaction (such as any sale, exchange or leasing of any property
between you and the account, or any interference with the independent
status of the account) then the account would lose its exemption from
tax and be treated as having been distributed to you. The value of the
entire account would be includible in your gross income, and if you
were then under age 59 1/2 you would also be subject to the 10%
penalty tax on early distributions.
9. Your entire interest in your account must be distributed, or begin to
be distributed, to you no later than the first April 1st of the year
following the later of the year in which you attain age 70 1/2.
Distribution may be made at once in a imp sum or it may be made in
installments. However, installment payments cannot be scheduled to be
made over a period which extends beyond your life expectancy (as
determined annually), or the joint life and last survivor expectancy
of you and the beneficiary you designate (as determined annually, if
that beneficiary is your spouse). However, where the beneficiary is
other than the spouse, the value of the expected distributions to you,
determined at the time distributions commence, must equal at least 50%
of the total value at that time. If the amount distributed during the
calendar year is less than the minimum amount required to be
distributed, the recipient would be subject to a penalty tax equal to
50% of the difference between the amount required to be distributed
and the amount actually distributed. If you die before the entire
interest is distributed to you, but after you have begun to receive
distributions, your entire account must be distributed to your
beneficiary over a period no longer than the last determined life
expectancy or life and last survivor expectancy over which your
account was being distributed prior to your death. If you die before
the entire interest has begun to be distributed to you and your spouse
is your beneficiary, distributions to your spouse must either (a) be
completed within 5 years of your death or (b) commence before the
later of one year after your death or the date on which you would have
attained age 70 1/2 and continue over his or her life or a period not
exceeding his or her life expectancy. If you die before the entire
interest has begun to be distributed to your beneficiary must either
(a) be completed within five years of your death or (b) commence with
one year after your death and continue over your beneficiary's life or
a period not exceeding his or her life expectancy.
10. Amounts distributed to you are invaluable in your gross income when
you receive them and are taxable as ordinary income without any
special lump-sum distribution privileges. However, normal four-year
income averaging may be available.
11. You must file Treasury Form 5329 with the Internal Revenue Service for
each calendar year during which there is an excess contribution,
premature distribution, or during which there is an insufficient
distribution as refereed to in paragraph 9.
12. The Individual Retirement Account Plan has been approved as to form by
the Internal Revenue Service. This approval is a determination only as
to the form of the account and does not represent a determination of
the merits of such account.
13. Information about the shares of each mutual fund available for
investment by your individual retirement account must be furnished to
you in form of a prospectus governed by rules or the Securities and
Exchange Commission. Please refer to the prospectus for detailed
information concerning your mutual fund. Growth in the value of your
account cannot be guaranteed or projected. However, the income and
operating expenses of a mutual fund will affect the value of its
shares, and hence the value of your account, as does any increase or
decrease in the value of the assets of the mutual fund. The fund's
prospectus containing information regarding current income and
expenses of your mutual fund.
Fees and other expenses maintaining your account may be charged to you
or your account. The Custodian's fee schedule is referred to in
Article IX of the Plan document and is distributed to you with it.
<PAGE>
14. The information contained in this Disclosure Statement and the terms
of the related Custodial Account agreement are applicable to
Individual Retirement Accounts set up, and contributions made, with
respect to the 1986 calendar year. Effective January 1, 1987, the law
with regard to the establishment, maintenance and termination of
Individual Retirement Accounts has been substantially modified. For
example, a married individual will only be able to make a fully
deductible contribution to his or her account (an amount equal to the
lesser of his or her compensation or earnings from self-employment, of
$2,000) if the married couple files a joint Federal income tax return
and they satisfy either of the following standards: (a) their combined
adjusted gross income is less than $40,000 or (b) neither spouse
actively participates in an employer-sponsored retirement plan. A
single individual will be subject to similar rules except that the
adjusted gross income limit is $25,000. Married couples and single
individuals who do not satisfy the active-participant standard and
whose adjusted gross incomes exceed the applicable limit by not more
than $10,000 will be eligible to make limited deductible Individual
Retirement Account contributions. Generally speaking, for every $5 by
which a couple's or single individual's adjusted gross income exceeds
the applicable limit, the $2,000 cap on the amount of deductible
contributions is reduced by $1. Individuals who are not eligible to
make fully deductible Retirement Account contributions will be
permitted to make nondeductible contributions equal to the difference
between (a) the lesser of his or her compensation or earnings from
self-employment, or $2,000, minus (b) the maximum amount the
individual is permitted to contribute on a deductible basis. Earnings
on both deductible and non-deductible contributions will accumulate on
a tax-deferred basis.
If you have not received this Disclosure Statement at least seven calendar
days before the establishment of your Individual Retirement Account, you have
the right to revoke your Individual Retirement Account during the seven calendar
day period following the establishment of it. In order to so revoke your
Individual retirement Account, you must do so in writing and you must mail or
deliver your revocation to Scudder Fund Distributors, Inc., 175 Federal Street,
Retirement Plan Services, Boston, MA 01220. If your revocation is mailed, the
date of the postmark (or the date of certification or registration if sent by
certified or registered mail) will be considered your revocation date. If you so
revoke your individual retirement account during the seven-day period, the
entire amount of your account, without any adjustments (for items such as
administrative expenses, fees, or fluctuation in market value) will be returned
to you.
You may obtain further information from any district office of the Internal
Revenue Service.
Scudder
[Logo] IRA Portfolio
12-8-28 (c) Scudder Fund Distributors, Inc.
<PAGE>
400-28
Scudder IRA Application
&
IRA Transfer Request
for ....
- ---------------------------------------------
Return these forms to:
Scudder Fund Distributors, Inc.
P.O. Box 2291
Boston, MA 02107-2291
- ---------------------------------------------
It's easy to open a Scudder IRA. Just complete the Scudder IRA Application and
return it in the enclosed postage-paid envelope today.
A Few Tips
o Please make check(s) payable to "Scudder Funds."
o You have two forms--an IRA Application and an IRA Transfer Request.
Please do not separate them, even if you use only one.
o Please fill out each section carefully, preferably in print or type.
This helps us avoid any delays in processing your Application.
o Please be sure to sign your name exactly as it appears in your Account
Registration (Part 1).
o If you are transferring IRA assets from another IRA sponsor, please
fill out the attached IRA Transfer Request form and return it along
with your Application and a check for any investment you may be making
at this time.
If you already have a Scudder IRA, complete only the IRA Transfer
Request form.
Please return this form today. It will only take a few minutes and
will let us put your money to work for you that much sooner!
<PAGE>
Scudder
[Logo] IRA Portfolio Application
1. IRA Account Registration
___________________________________ ___________________________________
Name Social Security Number
( )
___________________________________ ___________________________________
Address Daytime Phone
/ /
________________ ________ _________ ___________________________________
City State Zip Date of Birth
2. Type of IRA & Fund Choices
/___/ New IRA. $2000 maximum per year. Contribution for tax year 198__
/___/ Transfer IRA. IRA assets transferred directly from your present
custodian to Scudder. If the transfer establishes your first Scudder
IRA, please complete this Application and an IRA Transfer Request
making sure to indicate fund(s) choices on both forms. If transferring
to an existing Scudder IRA, complete only the IRA Transfer Request. A
separate Transfer Request must be completed for each IRA being
transferred.
/___/ Rollover IRA. (check one)
/___/ Assets distributed from an employer-sponsored retirement
plan.
or
/___/ 60-day Rollover. You have taken receipt of your IRA assets
from another institution and are enclosing a check for part
or all of these funds.
The minimum initial investment is $240.
If you choose more than one fund, the minimum initial investment is $500 for
each fund.
$ Amount Money Market Funds
__________ Cash Investment Trust
__________ Government Money Fund
Income Funds
__________ GNMA Fund
__________ Income Fund
__________ Target Fund (multi-Portfolios),
__________ U.S. Government 1990_______________
__________ General 19______________
Maturity year
U.S. Gov't. Zero Coupon
__________ Target Fund _______________
Maturity year
Growth & Income Funds
__________ Equity Income Fund
__________ Growth and Income Fund
Growth Funds
__________ Japan Fund
__________ Capital Growth Fund
__________ Development Fund
__________ Global Fund
__________ International Fund
$ Total
==========
3. Designation of Beneficiary & Signatures
(Please be sure to sign your name exactly as it apears in Part 1.)
The following person(s) are to receive the balance of my IRA assets upon my
death. This designation revokes any previous one I may have filed with the
Custodian. (Provide name(s), address(es), and Social Security Number(s).)
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
Any resident of a Community Property State who designates a spouse as primary
beneficiary and others as contingent beneficiaries, or designates more than half
the distribution to beneficiaries other than a spouse, must obtain the spouse's
consent.
Spouse's
consent X______________________________________________________ _______________
Signature Date
I hereby designate the beneficiaries listed and adopt with the custodian this
Scudder Individual Retirement Account agreement which uses the language of IRS
Form 5305-A. Once the Custodian acknowledges receipt of this form by mail, it
shall be deemed accepted, and therefore, effective as of the date I signed it. I
have received and read the Scudder IRA plan and the prospectus(es) of the
fund(s) selected.
X /s/ G. Reeves
- -------------------------------------------------------------------------------
State Street Bank and Trust Company, Custodian
X______________________________________________________________ _______________
Your Signature Date (exactly as in Part 1) Date
<PAGE>
Scudder Extra Application
[IRA Portfolio For your spouse or friend
1. IRA Account Registration
___________________________________ ___________________________________
Name Social Security Number
( )
___________________________________ ___________________________________
Address Daytime Phone
/ /
________________ ________ _________ ___________________________________
City State Zip Date of Birth
2. Type of IRA & Fund Choices
/___/ New IRA. $2000 maximum per year. Contribution for tax year 198__
/___/ Transfer IRA. IRA assets transferred directly from your present
custodian to Scudder. If the transfer establishes your first Scudder
IRA, please complete this Application and an IRA Transfer Request
making sure to indicate fund(s) choices on both forms. If transferring
to an existing Scudder IRA, complete only the IRA Transfer Request. A
separate Transfer Request must be completed for each IRA being
transferred.
/___/ Rollover IRA. (check one)
/___/ Assets distributed from an employer-sponsored retirement
plan.
or
/___/ 60-day Rollover. You have taken receipt of your IRA assets
from another institution and are enclosing a check for part
or all of these funds.
The minimum initial investment is $240.
If you choose more than one fund, the minimum initial investment is $500 for
each fund.
$ Amount Money Market Funds
__________ Cash Investment Trust
__________ Government Money Fund
Income Funds
__________ GNMA Fund
__________ Income Fund
__________ Target Fund (multi-Portfolios),
__________ U.S. Government 1990_______________
__________ General 19______________
Maturity year
U.S. Gov't. Zero Coupon
__________ Target Fund _______________
Maturity year
Growth & Income Funds
__________ Equity Income Fund
__________ Growth and Income Fund
Growth Funds
__________ Japan Fund
__________ Capital Growth Fund
__________ Development Fund
__________ Global Fund
__________ International Fund
$ Total
==========
3. Designation of Beneficiary & Signatures
(Please be sure to sign your name exactly as it apears in Part 1.)
The following person(s) are to receive the balance of my IRA assets upon my
death. This designation revokes any previous one I may have filed with the
Custodian. (Provide name(s), address(es), and Social Security Number(s).)
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
Any resident of a Community Property State who designates a spouse as primary
beneficiary and others as contingent beneficiaries, or designates more than half
the distribution to beneficiaries other than a spo9use, must obtain the spouse's
consent.
Spouse's
consent X______________________________________________________ _______________
Signature Date
I hereby designate the beneficiaries listed and adopt with the custodian this
Scudder Individual Retirement Account agreement which uses the language of IRS
Form 5305-A. Once the Custodian acknowledges receipt of this form by mail, it
shall be deemed accepted, and therefore, effective as of the date I signed it. I
have received and read the Scudder IRA plan and the prospectus(es) of the
fund(s) selected.
X /s/ G. Reeves
- -------------------------------------------------------------------------------
State Street Bank and Trust Company, Custodian
X______________________________________________________________ _______________
Your Signature Date (exactly as in Part 1) Date
RETURN THIS FORM IN THE POSTPAID ENVELOPE PROVIDED, OR MAIL TO:
SCUDDER FUNDS, P.O. BOX 2291, BOSTON, MA 02107-2291.
<PAGE>
It's easy to open a Scudder IRA. Just complete this Scudder IRA Application
and return it in the enclosed postage-paid envelope today.
A Few Tips
o Please make check(s) payable to "Scudder Funds".
o You have two forms--an IRA Application and an IRA Transfer Request.
Please do not separate them, even if you use only one.
o Please fill out each section carefully, preferably in print or type.
This helps us avoid any delays in processing your Application.
o Please be sure to sign your name exactly as it appears in your Account
Registration (Part 1).
o If you are transferring IRA assets from another IRA sponsor, please
fill out an IRA Transfer Request form and return it along with your
Application and a check for any investment you may be making at this
time.
If you already have a Scudder IRA, complete only the IRA Transfer
Request form.
Please return this form today. It will only take a few minutes and
will let us put your money to work for you that much sooner!
<PAGE>
Scudder [Logo] IRA Portfolio IRA Transfer Request
Complete this form if you wish to transfer the assets in your current IRA
directly to the Scudder IRA. If establishing a new Scudder IRA, complete the
Scudder IRA Application as well. Return this form in the postpaid envelope
provided. We will send you a notice confirming that we received this form, and
arrange to complete the transfer. The amount you transfer does not affect the
amount you can invest and deduct annually. If you wish to transfer assets held
in another type of plan, e.g. Keogh, profit-sharing, 403(b), etc., please call
us for the proper forms. This form is only for IRA transfers.
1. Name & Address
___________________________________ ___________________________________
Name Social Security Number
( )
___________________________________ ___________________________________
Address Daytime Phone
/ /
________________ ________ _________
City State Zip
2. Instructions to Present Custodian
- --------------------------------------------------------------------------------
Name of Current Custodian/Trustee
- --------------------------------------------------------------------------------
Attention: (Person or department handling transfers)
___________________________________
Address
________________ ________ _________
City State Zip
/___/ Please transfer all of my IRA assets.
/___/ Please transfer $_____ of my IRA assets.
Other instructions (e.g., make transfer upon maturity)
/ /
- -------------------------------------------------------------------------------
maturity date
- --------------------------------------------------------------------------------
IRA Account Number (with this Custodian)
( )
- --------------------------------------------------------------------------------
Custodian's Phone Number
I request that the above-named Custodian or Trustee transfer my IRA assets as
cash to State Street Bank and Trust Company, Custodian of my Scudder IRA.
- --------------------------------------------------------------------------------
Please make the check payable to:
Scudder Funds, A/C (Investor name), Scudder IRA
Mail to: The Scudder Funds Retirement Plan Services,
P.O. Box 9647, Boston, MA 02205-9918
X
- --------------------------------------------------------------------------------
[ILLEGIBLE]
- -------------------------------------------------------------------------------
Please ask your present custodian if a signature guarantee is required.
3. Fund Choices (If you invest in 2 or more funds, the minimum initial
investment is $500 for each fund.
$ Amount Money Market Funds Acct. #*
_____________ Cash Investment Trust _____________
_____________ Government Money Fund _____________
Growth & Income Funds
_____________ Equity Income Fund _____________
_____________ Growth and Income Fund _____________
Growth Funds
_____________ Japan Fund _____________
_____________ Capital Growth Fund _____________
_____________ Development Fund _____________
_____________ Global Fund _____________
_____________ International Fund _____________
_____________ GNMA Fund _____________
_____________ Income Fund _____________
Target Fund
(Multi-Portfolios),
_____________ U.S. Government 1990 _____________
_____________ General 199_____________
Maturity year _____________
U.S. Government Zero Coupon
_____________ Target Fund______________ _____________
Maturity year
Total _____________
* When transferring to an existing Scudder IRA, please provide your Scudder IRA
account number.
================================================================================
For Scudder use only, do not complete.
Acceptance by Custodian
We agree to accept custodianship and the transfer described above for the
Scudder IRA Plan established on behalf of the above-names individual. State
Street Bank and Trust Company accepts its appointment as successor Custodian of
the above IRA account and requests the liquidation and transfer of assets as
indicated above.
Scudder Fund Distributors, Inc.
By _____________________________________________________________________________
Date ___________________________________________________________________________
State Street Bank & Trust Company
By /s/ G. Reeves
-----------------------------------------------------------------------------
<PAGE>
Scudder
[Logo] IRA Portfolio
Scudder Fund Distributors, Inc.
175 Federal Street, Boston, MA 02110
National Toll-Free Number
1-800-225-2470
Exhibit 16(b)
<PAGE>
Managed Intermediate Government Fund
Schedule for Computation
SEC 30 Day Yield Calculation
For the period ended December 31, 1993
Yield = 2[(a-b / cd + 1)^6 -1]
Where: a = dividends and interest earned during the period.
b = expenses accrued for the period (net of reimbursements).
c = the average daily number of shares outstanding during the
period that were entitled to receive dividends.
d = the maximum offering price per share on the last day of
the period.
2[(73,903.76 - 8,699.96 / 1,470,342.59 x 9.98 + 1)^6 -1] =
2[(65,203.80 / 14,674,019.05 + 1)^6 -1] =
2[(1.00444348612)^6 -1] =
2[1.026958846 -1] = 5.39%
<PAGE>
Managed Intermediate Government Fund
Schedule for Computation
Annualized Total Return Calculation
for the period from March 1, 1993 (commencement of operations)
through December 31, 1993
T = (ERV/P)^1/n -1
Where:
P = a hypothetical initial investment of $1,000.
T = annualized total return.
n = number of years.
ERV = ending redeemable value: ERV is the value, at the end of the
applicable period, of a hypothetical $1,000 investment made at the
beginning of the applicable period.
(1,043.74/1,000)^1/.833 - 1 =
(1.04374)^1.200480 - 1 =
1.052 - 1 = 5.2%
EXHIBIT 18
<PAGE>
LAZARD TAX-FREE RESERVES, INC.
ARTICLES SUPPLEMENTARY TO THE
ARTICLES OF INCORPORATION
LAZARD TAX-FREE RESERVES, INC., a Maryland corporation having its
principal office in New York, New York (the "Corporation"), hereby certifies to
the State Department of Assessments and Taxation of Maryland that:
FIRST: The Board of Directors of the Corporation at a meeting duly
convened and held on January 27, 1987, adopted a resolution classifying
3,000,000,000 unissued and unclassified shares, par value $.00l per share, of
the Capital Stock of the Corporation into a class designated "Lazard Cash
Management Fund" and classifying 3,000,000,000 unissued and unclassified shares,
par value $.00l per share, of the Capital Stock of the Corporation into a class
designated "Lazard Government Fund", in each case by setting before the issuance
of such shares, the preferences, conversion and other rights, voting powers,
restrictions, limitations as to dividends, qualifications and terms and
conditions of redemption thereof as hereinafter set forth.
SECOND: The Board of Directors of the Corporation at a meeting duly
convened and held on February 24, 1987 adopted a resolution classifying an
aggregate of 400,000,000 unissued and unclassified shares, par value $.001 per
share, of the Capital Stock of the Corporation as follows:
<PAGE>
100,000,000 into a class designated "Lazard Tax-Free Bond Fund"; 100,000,000
into a class designated "Lazard New York Tax-Free Bond Fund"; 100,000,000 into a
class designated "Lazard Bond Fund"; and 100,000,000 into a class designated
"Lazard Equity Fund", in each case by setting before the issuance of such
shares, the preferences, conversion and other rights, voting powers,
restrictions, limitations as to dividends, qualifications and terms and
conditions of redemption thereof as hereinafter set forth.
THIRD: A description of the shares so classified, with the
preferences, conversion and other rights, voting powers, restrictions,
limitations as to dividends, qualifications and terms and conditions of
redemption as set by the Board of Directors of the Corporation is as follows
(with each such class being herein referred to individually as a "Class" and
collectively as "Classes"):
1. All consideration received by the Corporation upon the sale and
issue of shares of a particular Class, and all income and other assets
resulting from the investment and reinvestment of that consideration,
income and other assets, will irrevocably be attributable to that Class of
shares, subject to the rights of creditors, and will be recorded on the
books of account of the Corporation as assets attributable to that Class.
2. Dividends or distributions on shares of a particular Class,
whether payable in stock or cash, will be paid only out of earnings,
surplus or other assets attributable to that Class of shares.
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<PAGE>
3. In the event of the liquidation or dissolution of the
Corporation, holders of shares of a particular Class will be entitled to
receive, as a class, out of the assets of the Corporation available for
distribution to stockholders, but not including general assets not
attributable to a Class of shares, the assets attributable to that Class
of shares. The assets so distributable to the stockholders of that Class
will be distributed among such stockholders in proportion to the number of
shares of such Class held by them and recorded on the books of the
Corporation. If there are any general assets of the Corporation not
attributable to any specific Class of shares and available for
distribution, distribution of those other assets will be made to the
holders of shares of all Classes of the Corporation's Capital Stock in
proportion to the aggregate asset value of those Classes.
4. The assets attributable to shares of a particular Class will be
charged with the liabilities relating to that Class and will also be
charged with general liabilities of the Corporation in the proportion that
the aggregate asset value of that Class bears to the aggregate asset value
of all Classes of shares of the Corporation. The determination of the
Board or Directors will be conclusive as to the amount of liabilities
including accrued expenses and reserves, and as to the allocation of
liabilities among Classes. The liabilities so allocated to a Class are
herein referred to as liabilities attributable to that Class.
5. At each meeting of stockholders of the Corporation each
stockholder present in person or by proxy at the meeting will be entitled
to one vote for each share of stock standing in the stockholder's name on
the books of the Corporation, irrespective of the Class, except that where
a vote of the holders of the shares of a Class, or of more than one Class,
voting by Class, is required by the Investment Company Act of 1940 or the
laws of Maryland, or both, as to any proposal, only the holders of shares
of that Class or Classes, voting by Class, will be
-3-
<PAGE>
entitled to vote upon such proposal and the holders of any other Class or
Classes will not be entitled to vote thereon. Fractional shares will be
entitled proportionately to all the rights of a whole share, including the
right to vote and the right to receive dividends and other distributions.
6. The redemption rights of the holders of shares of a particular
Class will apply only to the assets attributable to that Class.
7. The net asset value per share computation provided for in Section
6 of ARTICLE V of the Corporation's Articles of Incorporation will be
determined for each Class of shares of the Corporation on the basis of the
assets and liabilities attributable to that Class and the outstanding
shares of that Class.
8. Except as otherwise provided herein, the shares of each Class
will have the same rights as provided in ARTICLE V of the Corporation's
Articles of Incorporation relating to the Capital Stock of the
Corporation.
FOURTH: The Shares aforesaid have been duly classified by the Board
of Directors pursuant to authority and power contained the Corporation's
Articles of Incorporation.
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<PAGE>
IN WITNESS WHEREOF, LAZARD TAX-FREE RESERVES, INC. has caused these
present to be signed in its name and on its behalf by its President and attested
by its Secretary on April 28, 1987.
LAZARD TAX-FREE RESERVES, INC.
By /s/ Karl A. Deavers
------------------------
Karl A. Deavers, President
Attest:
/s/ Irene McC. Pelliconi
- ---------------------------------
Irene McC. Pelliconi, Secretary
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<PAGE>
STATE OF NEW YORK )
: ss:
COUNTY OF NEW YORK )
The undersigned, President of LAZARD TAX-FREE RESERVES, INC., who
executed on behalf of said corporation the foreqoing Articles Supplementary to
the Articles of Incorporation of which this certificate is made a part, hereby
acknowledges, in the name and on behalf of said corporation, the foregoing
Articles Supplementary to the Articles of Incorporation to be the corporate act
of said corporation and further certifies that, to the best of his knowledge,
information and belief, the matters and facts set forth therein with respect to
the approval thereof are true in all material respects, under the penalties of
perjury.
/s/ Karl A. Deavers
----------------------
Karl A. Deavers
Sworn to before me on
this 28 day of April, 1987
/s/ Linda C. Joyce
- --------------------
Notary Public
Linda C. Joyce
Notary Public, State of New York
No. 24-4606383
Qualified in Rockland County
Commission Expires Aug. 31, 1989
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