FIDELITY BOND ALLOCATION AGREEMENT
This Agreement is dated as of December 15, 2006 and is entered into by and
among Xxxxxx Xxxxxx Funds I ("Trust I") and Xxxxxx Xxxxxx Funds II ("Trust
II"), each on behalf of its investment portfolios. Trust I and Trust II are
referred to collectively as the "Parties".
In order to obtain joint-insureds fidelity bond under one or more asset
protection bonds (the "Bond"), and in consideration of the mutual agreements
set forth below, the Parties agree as follows:
1. The Bond. The parties agree to secure and maintain the Bond, which will
ensure each Party's respective portfolios, directors/trustees, partners
and officers, and may insure such Party's agents and employees (with
each of such insureds being referred to as an "Insured" and any Party
and such of its Insureds being referred to as a "Party and its
Insureds").
2. Definitions. As used in this Agreement, the following terms have the
following meanings:
(a) "Agent" means IXIS Asset Management North America, L.P. or its
successor, acting as agent for the Parties.
(b) "Gross Coverage" means the limit of liability under the Bond plus
all deductibles applied to Insured Losses relating to the
particular Bond Period.
(c) "Insured Loss" means a loss (including all related expenses) of an
Insured that is covered under the Bond (including any endorsement
thereof) or that would be so covered but for the exhaustion of the
applicable limit of liability and any applicable deductible).
(d) "Bond Period" means the period from the initial effective date of
the Bond through the next succeeding anniversary date or the period
from any anniversary date subsequent to the initial effective date
through the next succeeding anniversary date (or any modification
of such period as may be agreed to by the parties and the Insurer).
(e) "Proceeds" means the insurance proceeds for all Insured Losses
under the Bond relating to a particular Bond Period.
3. Allocation of Premiums. Except as otherwise provided below, the Bond
premium for any period shall be allocated among the Parties insured
during that period in proportion to their respective net assets.
However, in the event that one or more Insureds claim Insured Losses,
any increase in premium in subsequent Bond Periods due to such claims,
as determined by
the broker, shall be allocated among the Parties that made such claims
in proportion to their respective net assets.
4. Allocation of Coverage.
(a) Coverage Sufficient for Insured Losses. If an Insured Loss is no
greater than the Gross Coverage, the Proceeds for such Insured Loss
shall be allocated among the Insureds according to their respective
Insured Losses.
(b) Allocation of Limited Coverage. If an Insured Loss exceeds the
Gross Coverage, the Proceeds for such Insured Loss shall be
allocated among the respective Insureds who sustained such losses
in proportion to the respective amounts of the Insured Losses of
such Insureds. Each Party shall receive a share of the recovery at
least equal to the amount of recovery it would have received under
a single insured bond with the minimum amount coverage required for
such bond under the Investment Company Act of 1940 and the
regulations thereunder.
5. Notices. Each Insured agrees to promptly give the Insurer all notices
required under the Bond.
6. Agent. The Agent is hereby appointed as the agent for the Insureds for
the purposes of (a) seeking, negotiating and obtaining the Bond,
(b) making, adjusting, receiving and enforcing payment of all claims
under the bond and (c) otherwise dealing with the Insurer with respect
to the Bond. All reasonable expenses incurred by the Agent in its
capacity as agent for claims shall be shared by the Parties and their
respective Insureds on whose behalf the expenses were incurred in
proportion to their Insured Losses.
7. Notification of Agent. Each Party shall promptly notify the Agent in
writing of any circumstance that may give rise to a claim by such Party
or its Insureds under the Bond.
8. Modification and Termination. This Agreement may be modified or amended
from time to time by mutual written agreement among the Parties. It
shall terminate with respect to any Insured as of the date such Insured
ceases to be an insured under the Bond; provided that such termination
shall not affect the Insured's rights and obligations hereunder with
respect to any claims or Insured Losses relating to a period when the
Insured was insured under the Bond.
9. Further Assurances. Each party agrees to perform such further acts and
execute such further documents as are necessary to effect the purposes
hereof.
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed as of
the date first written above.
Xxxxxx Xxxxxx Funds I
Xxxxxx Xxxxxx Funds II
By: /s/ Xxxxxxx Xxxxxx
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Name: Xxxxxxx Xxxxxx
Title: Treasurer
