EXHIBIT 9(E)(I)
SUB-ADMINISTRATION AGREEMENT
SUB-ADMINISTRATION AGREEMENT made this 1st day of July, 1996 between Xxxxxx
Trust & Savings Bank ("Xxxxxx"), an Illinois corporation, and Funds Distributor,
Inc. ("FDI"), a Massachusetts corporation.
WHEREAS, Xxxxxx has entered into an Administration Agreement, dated July 1,
1996, with HT Insight Funds, Inc. d/b/a Xxxxxx Insight Funds (the "Company"), a
Maryland corporation and Xxxxxx has entered into an Administration Agreement,
dated July 1, 1996, with Xxxxxx Insight Funds Trust (the "Trust"), a
Massachusetts business trust (collectively, the "Administration Agreements"),
concerning the provision of administrative services for those certain investment
portfolios of the Company and Trust identified on Schedule A hereto, as such
Schedule shall be amended from time to time (each, a "Fund," together, the
"Funds"). The Company and the Trust are collectively referred to herein as the
"Companies";
WHEREAS, Xxxxxx has also entered into a Sub-Administration and Accounting
Services Agreement, dated July 1, 1996, with PFPC, Inc. ("PFPC"), whereby PFPC
shall perform certain administration and transfer agency services with respect
to the Shares of the Funds;
WHEREAS, Xxxxxx desires to retain FDI to assist it in performing certain
administrative services with respect to the Companies, and shares of the common
stock or beneficial interest (the "Shares") of the Funds and FDI is willing to
perform such services on the terms and conditions set forth in this Agreement;
WHEREAS, in furtherance of FDI's duties and responsibilities as set forth
herein, one or more employees of Xxxxxx (who shall be registered with the
National Association of Securities Dealers ("NASD") as representatives of FDI),
shall be based in the Xxxxxx office in Chicago (such Xxxxxx employees shall
hereinafter be referred to as a "Registered Representative");
NOW THEREFORE, in consideration of the mutual agreements herein contained, the
parties agree as follows:
1. Appointment and Acceptance. Xxxxxx hereby appoints FDI to act as
Sub-Administrator of the Funds in accordance with the terms set forth in this
Agreement. FDI hereby accepts such appointment and agrees to furnish the
services contemplated by the Agreement.
2. Services Provided by FDI. FDI will assist Xxxxxx by providing to each of the
Companies and Funds the services as listed in Exhibit A.
3. Services Provided by Xxxxxx. In furtherance of the responsibilities under
this Agreement Xxxxxx will:
(a) Cause the Companies' other service providers to furnish any and all
information and assist FDI in taking any other actions that may be
reasonably necessary in connection with FDI providing those services
listed in Exhibit A;
(b) Cause the Companies' blue sky administrator to monitor sales of the
Shares to assure compliance with applicable state securities laws;
(c) Report or cause the Companies' transfer agent to provide
sales-related complaints to FDI and consult with FDI concerning the
manner in which such complaints will be addressed;
(d) Cause the Companies' transfer agent to give necessary information
for the preparation of quarterly reports in a form satisfactory to FDI
regarding Rule 12b-1 fees, front-end sales loads, back-end sales loads,
if applicable, and other data regarding sales and sales loads as
required by the Investment Company Act of 1940, as amended (the "1940
Act"), or as requested by the Board of Directors or Board of Trustees
of each Fund (collectively, the "Boards");
(e) Cause the Companies' transfer agent to provide FDI with all
necessary historical information so that FDI can calculate the maximum
sales charges payable by the Companies pursuant to Article III, Section
26 of the Rules of Fair Practice of the NASD and the actual sales
charges paid by each Fund, if applicable; and cause the Companies'
transfer agent to provide such information in a form satisfactory to
FDI no less often than monthly for every Fund and on a more frequent
basis for any Fund, where applicable;
(f) Support or cause the Companies' transfer agent to support the
servicing of shareholders and, in connection therewith, provide or
cause the Companies' transfer agent to provide one or more persons
during normal business hours to respond to telephone questions
concerning the Companies' shareholders' accounts;
(g) Provide FDI with copies of, or access to, any documents that FDI
may reasonably request in connection with the services contemplated by
this Agreement and notify FDI as soon as possible of any matter
materially affecting the services to be provided by FDI under this
Agreement;
(h) Report to FDI, to the extent that Xxxxxx is aware (except that
Xxxxxx shall not report to FDI any information available in the general
public domain), any and all actions or inactions by any Registered
Representative or securities dealers, financial institutions and other
industry professionals such as investment advisers and estate planning
firms that have entered into agreements with FDI for the solicitation
of Shares (collectively referred to herein as "Selling Broker-Dealers")
relating to the Shares that constitute a (i) failure to comply with the
terms of any selling agreements, (ii) violation of any applicable laws
of any governmental authorities, including the NASD's Rules of Fair
Practice, or (iii) violation of any other agreements or procedures with
which such Selling Broker-Dealer is required to comply; and
(i) (i) Submit the form of confirmation statement to be used for sale
of the Shares to FDI for its approval and provide or cause to be
provided to customers of the Selling Broker-Dealers ("Customers") and
to the Selling Broker-Dealers such confirmations of all transactions in
the Shares as may be required by the Securities Exchange Act of 1934
(the "1934 Act") and the selling agreements, and (ii) use reasonable
efforts to monitor the Fund's transfer agent in its preparation and
mailing of such confirmations regarding the sales of the Shares and
report to FDI any deficiencies of which Xxxxxx is aware in the transfer
agent's performance of such activities.
4. Compensation; Reimbursement of Expenses. Xxxxxx shall pay to FDI, for its
services, a fee in accordance with the terms set forth in the Fee Letter
Agreement dated as of July 1, 1996 relating to services to be provided to the
Companies, and executed by FDI, Xxxxxx and PFPC, Inc., as the same may be
amended from time to time.
5. Effective Date and Term. This Agreement shall become effective with respect
to each Fund as of the date first written above. This Agreement will continue
for an initial two-year term and will continue thereafter so long as such
continuance is specifically approved at least annually (i) by the Companies'
Boards or (ii) by a vote of a majority (as defined in the 0000 Xxx) of the
Shares of the Funds, provided that in either event its continuance also is
approved by a majority of the Boards' members who are not "interested persons"
(as defined in said Act) of any party to this Agreement and who have no direct
or indirect financial interest in this Agreement, by vote cast in person at a
meeting called for the purpose of voting on such approval. This Agreement is
terminable with respect to any Fund, without penalty, on not less than sixty
days' notice, by that Fund's Board, by vote of a majority (as defined in the
0000 Xxx) of the outstanding voting securities of such Fund. This Agreement
shall terminate automatically in the event of its "assignment" (as defined in
the 1940 Act). This Agreement may be terminated by either party, on not less
than 60 days written notice, or upon any material breach of this Agreement by
the other party. If FDI ceases to be the Sub-Administrator of any Fund before
the fifth anniversary of the date the Fund began its investment activities,
Xxxxxx shall reimburse FDI an amount equal to the number resulting from
multiplying that Fund's total unamortized organizational expenses by a fraction,
the numerator of which is equal to the number of initial shares redeemed by FDI
or its affiliate and the denominator of which is equal to the number of initial
shares still outstanding as of the date of such redemption, as long as the
administrative position of the staff of the Securities and Exchange Commission
requires FDI to reimburse that Fund such amount. (Initial shares shall mean the
shares purchased by FDI or an affiliate to provide the initial seed capital to a
Fund pursuant to Section 14 of the 1940 Act.)
6. Standard of Care and Indemnification.
(a) Xxxxxx will indemnify and hold harmless FDI, its officers, employees
and agents and any persons who control FDI (together "FDI and its
employees") and hold each of them harmless from any losses, claims, damages
or liabilities, or actions in respect thereof, to which FDI and its
employees may become subject, including amounts paid in settlement with the
prior written consent of Xxxxxx, insofar as such losses, claims, damages or
liabilities, or actions in
respect thereof, arise out of or result from the failure of Xxxxxx to
comply with the terms of this Agreement;
Xxxxxx will reimburse FDI and its employees for reasonable legal or other
expenses reasonably incurred by FDI and its employees in connection with
investigating or defending against any such loss, claim, damage, liability
or action. Xxxxxx shall not be liable to FDI for any action taken or
omitted by FDI in bad faith, with willful misfeasance or gross negligence,
or with reckless disregard by FDI of its obligations and duties hereunder.
The indemnities in this Section shall, upon the same terms and conditions,
extend to and inure to the benefit of each of the employees of FDI that
serve as officers or directors of the Fund and to each of the directors and
officers of FDI and any person controlling FDI within the meaning of
Section 15 of the Securities Act of 1933 ("1933 Act") or Xxxxxxx 00 xx xxx
0000 Xxx.
(x) FDI will indemnify and hold harmless Xxxxxx, its officers, employees
and agents and any persons who control Xxxxxx (together "Xxxxxx and its
employees") and hold each of them harmless from any losses, claims, damages
or liabilities, or actions in respect thereof, to which Xxxxxx and its
employees may become subject, including amounts paid in settlement with the
prior written consent of FDI, insofar as such losses, claims, damages or
liabilities, or actions in respect thereof, arise out of or result from the
failure of FDI to comply with the terms of this Agreement;
FDI will reimburse Xxxxxx for reasonable legal or other expenses reasonably
incurred by Xxxxxx in connection with investigating or defending against
any such loss, claim, damage, liability or action. FDI shall not be liable
to Xxxxxx for any action taken or omitted by Xxxxxx in bad faith, with
willful misfeasance or gross negligence, or with reckless disregard by
Xxxxxx of its obligations and duties hereunder. The indemnities in this
Section shall, upon the same terms and conditions, extend to and inure to
the benefit of each of the directors and officers of Xxxxxx and any person
controlling Xxxxxx within the meaning of Section 15 for the 1933 Act or
Section 20 of the 1934 Act.
(c) The obligation to indemnify and provide contribution pursuant to this
Section 6 shall survive the termination of this Agreement.
7. Record Retention and Confidentiality. FDI shall keep and maintain on behalf
of each Fund all books and records which the Companies and FDI are, or may be,
required to keep and maintain in connection with the services to be provided
hereunder pursuant to any applicable statutes, rules and regulations, including
without limitation Rules 31a-1 and 31a-2 under the 1940 Act. FDI further agrees
that all such books and records shall be the property of the Companies and to
make such books and records available for inspection by the Companies, by
Xxxxxx, or by the Securities and Exchange Commission at reasonable times and
otherwise to keep confidential all books and records and other information
relative to the Companies and its shareholders; except when requested to divulge
such information by duly-constituted authorities or court process; provided,
however, that upon receiving notice to divulge any such information which is not
in the opinion of FDI or its counsel clearly required to be disclosed by the
1940 Act and the rules and regulations thereunder, FDI shall promptly provide
notice to the Boards of the
Companies and shall cooperate with the Companies' efforts, if any, to contest
the request to divulge such information.
8. Rights of Ownership. All computer programs and procedures developed to
perform the services to be provided by FDI under this Agreement are the property
of FDI. All records and other data except such computer programs and procedures
are the exclusive property of the Companies and all such other records and data
will be furnished to Xxxxxx and/or the Companies in machine-readable form as
agreed upon by the parties in accordance with industry practice as soon as
practicable after termination of this Agreement for any reason.
9. Return of Records. FDI may at its option at any time, and shall promptly upon
the demand of Xxxxxx and/or the Companies, turn over to Xxxxxx and/or the
Companies, in such machine-readable form as agreed upon by the parties in
accordance with industry practice, and cease to retain FDI's files, records and
documents created and maintained by FDI pursuant to this Agreement so long as
FDI shall be able to retain photocopies of such documents to the extent needed
by FDI in the performance of its services or for its legal protection. If not so
turned over to Xxxxxx and/or the Companies, such documents and records will be
retained by FDI for six years from the end of the fiscal year of the Fund for
which they were created. At the end of such six-year period, such records and
documents will be turned over to Xxxxxx and/or the Companies unless the
Companies authorize in writing the destruction of such records and documents.
10. Representations of Xxxxxx. Xxxxxx represents and warrants to FDI that this
Agreement has been duly authorized by Xxxxxx and, when executed and delivered by
Xxxxxx, xxxx constitute a legal, valid and binding obligation of Xxxxxx,
enforceable against Xxxxxx in accordance with its terms, subject to bankruptcy,
insolvency, reorganization, moratorium and other laws of general application
affecting the rights and remedies of creditors and secured parties.
11. Representations of FDI. FDI represents and warrants that this Agreement has
been duly authorized by FDI and, when executed and delivered by FDI, will
constitute a legal, valid and binding obligation of FDI, enforceable against FDI
in accordance with its terms, subject to bankruptcy, insolvency, reorganization,
moratorium and other laws of general application affecting the rights and
remedies of creditors and secured parties.
12. Notices. All notices or other communications hereunder to either party shall
be in writing and shall be deemed sufficient if mailed to Xxxxxx at the
following address: Xxxxxx Trust & Savings Bank, 000 Xxxx Xxxxxx Xxxxxx, Xxxxxxx,
XX 00000, Attention: Xxxxx X. Xxxxxxxx, Senior Vice President; and to FDI at the
following address: 00 Xxxxx Xxxxxx, Xxxxx 0000, Xxxxxx, XX 00000, Attention:
President with a copy to General Counsel or at such other address as such party
may designate by written notice to the other, or in either case if sent by
telex, telecopier, telegram or similar means of same day delivery (with a
confirming copy by mail as provided herein).
13. Headings. Paragraph headings in this Agreement are included for convenience
only and are not to be used to construe or interpret this Agreement.
14. Assignment. This Agreement and the rights and duties hereunder shall not be
assignable by either of the parties hereto except by the specific written
consent of the other party.
15. Governing Law. This Agreement shall be governed by and provisions shall be
construed in accordance with the laws of The Commonwealth of Massachusetts.
16. Counterparts. This Agreement may be executed by the parties hereto in
counterparts and if so executed, the separate instruments shall constitute one
agreement.
17. Entire Agreement. This Agreement constitutes the entire agreement of the
parties with respect to the subject matter hereof and supersedes any prior
arrangements, agreements or understandings.
18. Amendments of this Agreement. This Agreement may be amended by the parties
hereto only if such amendment is specifically approved by the Boards of the
Companies and such amendment is set forth in a written instrument executed by
each of the parties hereto.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed all as of the day and year first above written.
XXXXXX TRUST & SAVINGS BANK
By: /s/ Xxxxx X. Xxxxxxxx
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Name: Xxxxx X. Xxxxxxxx
---------------------------
Title: Senior Vice President
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FUNDS DISTRIBUTOR, INC.
By: /s/ Xxxx X. Xxxxxxxxx
---------------------------
Name: Xxxx X. Xxxxxxxxx
---------------------------
Title: Senior Vice President and
General Counsel
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Dated: July 1, 1996
SCHEDULE A
TO THE AGREEMENT
BETWEEN
XXXXXX TRUST & SAVINGS BANK AND
FUNDS DISTRIBUTOR, INC.
NAME OF FUND
HT INSIGHT FUNDS, INC.
Xxxxxx Insight Equity Fund
Xxxxxx Insight Short/Intermediate Bond Fund
Xxxxxx Insight Government Money Market Fund
Xxxxxx Insight Money Market Fund
Xxxxxx Insight Tax-Exempt Money Market Fund
Xxxxxx Insight Convertible Fund
Xxxxxx Insight Hemisphere Free Trade Fund
XXXXXX INSIGHT FUNDS TRUST
Xxxxxx Insight Equity Income Fund
Xxxxxx Insight Growth Fund
Xxxxxx Insight Small-Cap Opportunity Fund
Xxxxxx Insight Index Fund
Xxxxxx Insight International Fund
Xxxxxx Insight Balanced Fund
Xxxxxx Insight Convertible Securities Fund
Xxxxxx Insight Bond Fund
Xxxxxx Insight Intermediate Government Bond Fund
Xxxxxx Insight Intermediate Tax-Exempt Bond Fund
Xxxxxx Insight Tax-Exempt Bond Fund
XXXXXX TRUST & SAVINGS BANK
By: /s/ Xxxxx X. Xxxxxxxx
--------------------------
Name: Xxxxx X. Xxxxxxxx
--------------------------
Title: Senior Vice President
--------------------------
FUNDS DISTRIBUTOR, INC.
By: /s/ Xxxx X. Xxxxxxxxx
--------------------------
Name: Xxxx X. Xxxxxxxxx
--------------------------
Title: Senior Vice President and
General Counsel
--------------------------
EXHIBIT A
Administrative Services
Funds Distributor will provide the following administrative services:
Corporate and Secretarial Services
o Provide Secretary and the necessary complement of Assistant
Secretaries for the Companies.
o Maintain general corporate calendar. Track all legal and
compliance requirements through annual cycles.
o Board materials for quarterly board meetings and board committee
meetings:
o Prepare agenda and background materials for legal approval
o Make presentations
o Monitor annual approval requirements
o Prepare extensive background material for annual review of
advisory fees
o Prepare minutes
o Follow-up on matters raised at meetings
o Maintain Articles of Incorporation and By-Laws of the Company
o Maintain Declaration of Trust and By-Laws of the Trust
o Prepare organizational board meeting materials for new Funds
o Draft contracts, assisting in negotiation and planning, as
appropriate. For example negotiate, draft and keep current the
following contracts: (i) investment advisory and sub-advisory
contracts; (ii) Distribution Agreement; (iii) Bank Selling
Agreements; (iv) Broker Dealer Selling Agreements; (v) Transfer
Agency Agreement; (vi) Custody Agreement; (vii) Administration
Agreement and Sub-Administration Agreement; (viii) 12b-1 Plans and
related agreements; (ix) Shareholder Servicing Plans and Related
Agreements; (x) XXX Custodian Agreements; (xi) Bi-Party Repurchase
Agreements; (xii) Tri-Party Repurchase Agreements; (xiii) Futures
Account Agreement and Procedural Safekeeping Agreement; (xiv) loan
agreements; and (xv) various other agreements and amendments.
o Shareholder Meetings
o Draft Proxy Solicitation Materials
o Organize, attend and keep minutes
o Work with the Transfer Agent on Solicitations and Vote
Tabulation
o Provide legal presence at meetings
SEC and Public Disclosure Assistance
o Prepare and file three or fewer amendments per year to the
Companies' registration statement, including updating prospectuses
and SAIs.
o Coordinate/monitor, with assistance from PFPC and any other
relevant fund service providers, all XXXXX (Electronic Data
Gathering Analysis and Retrieval System) on-line filings
including, but not limited, to those related to post-effective
amendments, N-SARs, Rule 24f-2, Rule 24e-2 annual and semi-annual
shareholders reports.
o Review and file annual and semi-annual Shareholder Reports
prepared by PFPC.
o Review and file semi-annual N-SAR prepared by PFPC, after joint
review by FDI and PFPC.
o File Rule 24f-2 notices prepared by PFPC.
o Negotiate, obtain and file fidelity bond policies, and monitor the
Companies' compliance with Rule 17g-1 of the 1940 Act and with the
terms of the Companies' policies and agreements.
o Negotiate, obtain and monitor directors' and officers' errors and
omissions policies.
o Prepare and file shareholder meeting materials and assist with all
shareholder communications.
o Monitor the Companies' compliance with Rule 17d-1(7) under the
1940 Act.
Legal Consulting and Planning
o Provide general legal advice on matters relating to portfolio
management, Fund operations, mutual fund sales, development of
advertising materials, changing or improving prospectus
disclosure, and any potential changes in each Fund's investment
policies, operations, or structure.
o Maintain a continuing awareness of significant emerging regulatory
and legislative developments which may affect the Companies,
update the adviser on those developments, and provide related
planning assistance.
o Develop or assist in developing guidelines and procedures to
improve overall compliance by the Companies and their various
agents.
o Provide advice with regard to the Companies' litigation matters,
routine fund examinations and investigations by regulatory
agencies.
o Provide advice regarding long term planning for the Companies
including the creation of new funds or portfolios, corporate
structural changes, mergers, acquisitions, and other asset
gathering plans including new distribution methods.
o Maintain effective communications with fund counsel, counsel to
the "non-interested" board members and to the Companies' local
counsel.
o Create and implement timing and responsibility system for outside
legal counsel when necessary to implement major projects and the
legal management of such projects.
o Monitor activities and billing practices of outside counsel
performing services for the fund or in connection with related
fund activities.
Compliance
o Review of all testing that is done by fund accountant to assist
the adviser in complying with fund prospectus guidelines and
limitations, 1940 Act requirements, and Internal Revenue Code
requirements.
o Review of monthly testing and compliance report created by fund
accountant and PFPC, including:
o Tax compliance testing for gross income, short three,
diversification, and single issuer,
o 5% diversification testing for tax and 1940 Act compliance
based on current market value and acquisition cost testing, if
required,
o Income available for distribution report, which includes
capital gains and interest income, and
o Net investment income calculated on per-share basis each
month.
o Insure on a joint basis with PFPC that prospectus and 1940 Act
compliance tests are tailored to each individual Fund's prospectus
and that each tests against the type and amount of securities
held.
o Provide legal/compliance review of all sales literature and
advertisements prepared for the Funds. FDI will file such
materials and obtain such approvals for their use as may be
required by the Securities and Exchange Commission, the National
Association of Securities Dealers, Inc. or state securities
administrators.
o Jointly with PFPC create Compliance Manuals and workshops for
advisory personnel.
o Consultation and advice for resolution of compliance questions
along with the investment advisor and its counsel, the fund
administrator, the fund counsel and the fund accountant.
o Be actively involved with the management of SEC and other
regulatory examinations.
o Review with the investment adviser and fund administrator summary
reports created by the fund accountant of all compliance issues to
assure immediate compliance adjustments.
o Assist portfolio managers with compliance matters including
reviewing the Compliance Manual on a regular basis and attending
compliance meetings with the portfolio managers.
o Assist in developing guidelines and procedures to improve overall
compliance by the fund and its various agents.
o Maintain legal liaison with and provide legal advice and counsel
to fund regarding its relationships, contractual or otherwise,
with the various fund agents, such as the adviser, custodian,
transfer agent, and auditor with respect to their activities on
behalf of each Fund.
o Advice regarding all Companies distribution arrangements for
compliance with applicable banking and broker-dealer regulations.
o Provide other officers of the Companies as requested (e.g.,
President and Vice President).
o Maintaining the Companies' code of ethics and monitoring
compliance.
Funds Distributor is willing to provide any extraordinary administration
services ("Extraordinary Administrative Services") to the Companies. All of the
extraordinary administrative functions set forth below may be accomplished
wholly or partially by Funds Distributor, with the assistance of Companies
counsel or other counsel as designated by the Administrator, depending
upon the circumstances and timing constraints surrounding each request.
Extraordinary Administrative Services may, depending upon the circumstances,
include the following:
o Draft Proxy/Solicitation Documents on Form N-14 (Fund Mergers).
o An Annual Post-Effective Amendment that involves major prospectus
revisions or the addition of new investment portfolios.
o Board Meeting Materials for significant corporate restructuring or
other major changes as well as more than four board meetings
during a twelve month period.
o More than three Post-Effective Amendments in any twelve month
period.
o Drafting and Filing of Exemptive Orders (e.g., Joint Repurchase
Account), Revenue Rulings (e.g., Multi-Class) and other state
specific regulatory orders (e.g., Florida Request for Technical
Assistance).
o Drafting and Filing No-Action Letter requests with the SEC.
