Exhibit 8(f)
THIRD PARTY FEEDER AGREEMENT
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THIS AGREEMENT made and entered into as of the 1st day of May, 1996,
and as now amended on April 30, 2001, is by and among USAA Investment Management
Company ("USAA"), USAA Mutual Fund, Inc. (the "Company"), a Maryland
corporation, in respect of USAA S&P 500 Index Fund, a series thereof (the
"Fund"), Equity 500 Index Portfolio, a trust organized under the common law of
the State of New York (the "Portfolio"), and Deutsche Asset Management, Inc., a
Delaware corporation (the "Adviser"), with respect to the proposed investment
by the Fund in the Portfolio.
WITNESSETH
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WHEREAS, the Company and the Portfolio are each open-end management
investment companies and the Fund and the Portfolio have the same investment
objectives and substantively the same investment policies;
WHEREAS, the Adviser currently serves as the investment adviser of the
Portfolio;
WHEREAS, USAA currently serves as the principal underwriter and
investment manager of the Fund;
WHEREAS, the Company desires to invest all of the Fund's investable
assets in the Portfolio in exchange for a beneficial interest in the Portfolio
(the "Investment") on the terms and conditions set forth in this Agreement; and
WHEREAS, the Portfolio believes that accepting the Investment is in
the best interests of the Portfolio and that the interests of existing
investors in the Portfolio will not be diluted as a result of its accepting the
Investment; and
NOW, THEREFORE, in consideration of the foregoing, the mutual promises
herein made and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
I
THE INVESTMENT
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1.1 AGREEMENT TO EFFECT THE INVESTMENT. The Company agrees to assign,
transfer and deliver all of the investable assets (the "Assets") to the
Portfolio at each Closing (as hereinafter defined). The Portfolio agrees in
exchange therefor to issue to the Fund a beneficial interest (the "Interest")
in the Portfolio equal in value to the net value of the Assets of the Fund
conveyed to the Portfolio on that date of Closing.
II
CLOSING AND CLOSING DATE
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2.1 TIME OF CLOSING. The conveyance of the Assets in exchange for the
Interest, as described in Article 1, together with related acts necessary to
consummate such transactions, shall occur initially on the date the Company
commences its offering of shares of the Fund to the public and at each
subsequent date as the Company desires to make a further Investment in the
Portfolio (each, a "Closing"). All acts occurring at any Closing shall be
deemed to occur simultaneously as of the last daily determination of the
Portfolio's net asset value on the date of Closing.
2.2 RELATED CLOSING MATTERS. On each date of Closing, the Company, on
behalf of the Fund, shall authorize the Fund's custodian to deliver all of the
Assets held by such custodian to the Portfolio's custodian. The Fund's and the
Portfolio's custodians shall each acknowledge, in a form acceptable to the
other party, their respective delivery and acceptance of the Assets. The
Portfolio shall deliver to the Company acceptable evidence of the Fund's
ownership of the Interest. In addition, each party shall deliver to each other
party such bills of sale, checks, assignments, securities instruments, receipts
or other documents as such other party or its counsel may reasonably request.
Each of the representations and warranties set forth in Article III shall be
deemed to have been made anew on each date of Closing.
III
REPRESENTATIONS AND WARRANTIES
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3.1 THE COMPANY AND USAA. The Company and USAA represents and warrants
to the Portfolio and the Adviser that:
(a) ORGANIZATION. The Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of Maryland, the Fund
is a duly and validly designated series of the Company, and the Company and the
Fund have the requisite power and authority to own their property and conduct
their business as now being conducted and as proposed to be conducted pursuant
to this Agreement.
(b) AUTHORIZATION OF AGREEMENT. The execution and delivery of this
Agreement by the Company and the consummation of the transactions contemplated
hereby have been duly authorized by all necessary action on the part of the
Company and no other action or proceeding is necessary for the execution and
delivery of this Agreement by the Company, the performance by the Company of
its obligations hereunder and the consummation by the Company of the
transactions contemplated hereby. This Agreement has been duly executed and
delivered by the Company and constitutes a legal, valid and binding obligation
of the Company in respect of the Fund, enforceable against them in accordance
with its terms.
(c) AUTHORIZATION OF INVESTMENT. The Investment has been duly
authorized by all necessary action on the part of the Board of Trustees of the
Company.
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(d) NO BANKRUPTCY PROCEEDINGS. Neither the Company nor the Fund is
under the jurisdiction of a court in a proceeding under Title 11 of the United
States Code (the "Bankruptcy Code") or similar case within the meaning of
Section 368(a) (3) (A) of the Bankruptcy Code.
(e) FUND ASSETS. The Fund's Assets will, at the initial Closing,
consist solely of cash.
(f) FISCAL YEAR. The fiscal year end for the Fund is December 31.
(g) AUDITORS. The Company has appointed PricewaterhouseCoopers LLP as
the Fund's independent public accountants to certify the Fund's financial
statements in accordance with Section 32 of the Investment Company Act of 1940,
as amended ("1940 Act").
(h) REGISTRATION STATEMENT. The Company has reviewed the Portfolio's
registration statement on Form N-1A, as filed with the Securities and Exchange
Commission ("SEC"), and understands and agrees to the Portfolio's policies and
methods of operation as described therein.
(i) ERRORS AND OMISSIONS INSURANCE POLICY. The Company currently has
in force an errors and omissions liability insurance policy, insuring the Fund
against loss of up to $5 million for negligence or wrongful acts.
(j) SEC FILINGS. The Company has duly filed all forms, reports, proxy
statements and other documents (collectively, the "SEC Filings") required to be
filed under the Securities Act of 1933, as amended (the " 1933 Act"), the
Securities Exchange Act of 1934 (the " 1934 Act") and the 1940 Act
(collectively, the "Securities Laws") in connection with the registration of
its Shares, any meetings of its shareholders and its registration as an
investment company. The SEC filings were prepared in accordance with the
requirements of the Securities Laws, as applicable, and the rules and
regulations of the Securities and Exchange Commission (the "SEC") thereunder,
and do not contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
(k) 1940 ACT REGISTRATION. The Company is duly registered as an
open-end management investment company under the 1940 Act and the Fund and its
shares are registered or qualified in any states where such registration or
qualification is necessary and such registrations or qualifications are in full
force and affect.
3.2 THE PORTFOLIO AND THE ADVISER. The Portfolio and the Adviser each
represents and warrants to the Company and USAA that:
(a) ORGANIZATION. The Portfolio is a trust duly organized and validly
existing under the common law of the State of New York and has the requisite
power and authority to own its property and conduct its business as now being
conducted and as proposed to be conducted pursuant to this Agreement.
(b) AUTHORIZATION OF AGREEMENT. The execution and delivery of this
Agreement by the Portfolio and the consummation of the transactions
contemplated hereby have been duly authorized by all necessary action on the
part of the Portfolio by its Board of Trustees and no other action or
proceeding is necessary for the execution and delivery of this Agreement by the
3
Portfolio, the performance by the Portfolio of its obligations hereunder and
the consummation by the Portfolio of the transactions contemplated hereby. This
Agreement has been duly executed and delivered by the Portfolio and constitutes
a legal, valid and binding obligation of the Portfolio, enforceable against it
in accordance with its terms.
(c) AUTHORIZATION OF ISSUANCE OF INTEREST. The issuance by the
Portfolio of the Interest in exchange for the Investment by the Fund of the
Assets has been duly authorized by all necessary action on the part of the
Board of Trustees of the Portfolio. When issued in accordance with the terms of
this Agreement, the Interest will be validly issued, fully paid and
non-assessable by the Portfolio.
(d) NO BANKRUPTCY PROCEEDINGS. The Portfolio is not under the
jurisdiction of a court in a proceeding under Title 11 of the Bankruptcy Code
or similar case within the meaning of Section 368(a)(3)(A) of the Bankruptcy
Code.
(e) FISCAL YEAR. The fiscal year end of the Portfolio is December 31.
(f) AUDITORS. The Portfolio has appointed PricewaterhouseCoopers LLP
as the Portfolio's independent public accountants to certify the Portfolio's
financial statements in accordance with Section 32 of the 1940 Act.
(g) REGISTRATION STATEMENT. The Portfolio has reviewed the Company's
registration statement on Form N-1A (filed with the SEC), and understands and
agrees to the Fund's policies and methods of operation as described therein.
(h) ERRORS AND OMISSIONS INSURANCE POLICY. The Portfolio has in force
an errors and omissions liability insurance policy insuring the Portfolio
against loss of up to $ 10 million for negligence or wrongful acts.
(i) SEC FILINGS. The Portfolio has duly filed all SEC Filings required
to be filed with the SEC pursuant to the 1934 Act and the 1940 Act in
connection with any meetings of its investors and its registration as an
investment company. Beneficial interests in the Portfolio are not required to
be registered under the 1933 Act because such interests are offered solely in
private placement transactions that do not involve any 'public offering' within
the meaning of Section 4(2) of the 1933 Act. The SEC Filings were prepared in
accordance with the requirements of the Securities Laws, as applicable, and the
rules and regulations of the SEC thereunder, and do not contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading.
(j) 1940 ACT REGISTRATION. The Portfolio is duly registered as an
open-end management investment company under the 1940 Act and such registration
is in full force and effect.
(k) TAX STATUS. The Portfolio is taxable as a partnership under the
Internal Revenue Code of 1986, as amended (the "Code").
3.3 THE ADVISER. The Adviser represents and warrants to the Company
and USAA that:
4
(a) ORGANIZATION. The Adviser is a Delaware corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware and has the requisite power and authority to conduct its business as
now being conducted.
(b) AUTHORIZATION OF AGREEMENT. The execution and delivery of this
Agreement by the Adviser have been duly authorized by all necessary action on
the part of the Adviser and no other action or proceeding is necessary for the
execution and delivery of this Agreement by the Adviser. This Agreement has
been duly executed and delivered by the Adviser and constitutes a legal, valid
and binding obligation of the Adviser.
(c) ADVISERS ACT. The Adviser is registered as an investment adviser
under the Investment Advisers Act of 1940, as amended (the "Advisers Act").
3.4 USAA. USAA represents and warrants to the Portfolio and the
Adviser that:
(a) ORGANIZATION. USAA is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware and has
the requisite power and authority to conduct its business as now being
conducted.
(b) AUTHORIZATION OF AGREEMENT. The execution and delivery of this
Agreement by USAA has been duly authorized by all necessary action on the part
of USAA and no other action or proceeding is necessary for the execution and
delivery of this Agreement by USAA. This Agreement has been duly executed and
delivered by USAA and constitutes a legal, valid and binding obligation of
USAA.
(c) PRINCIPAL UNDERWRITER AND INVESTMENT MANAGER. USAA serves as the
Fund's principal underwriter and investment manager and is duly registered as a
broker-dealer under the 1934 Act and an investment adviser under the Advisers
Act.
IV
COVENANTS
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4.1 THE COMPANY. The Company covenants that:
(a) ADVANCE REVIEW OF CERTAIN DOCUMENTS. The Company will furnish the
Portfolio and the Adviser, at least 10 business days prior to filing or first
use, as the case may be, with drafts of its registration statement on Form N-1A
(including amendments) and prospectus supplements or amendments relating to the
Fund. The Company will furnish the Portfolio and the Adviser with any proposed
advertising or sales literature relating to the Fund at least 2 business days
prior to filing or first use. The Company agrees that it will include in all
such Fund documents any disclosures that may be required by applicable law,
particularly those requested by the Adviser and relating to the Adviser, and it
will include in all such Fund documents any material comments reasonably made
by the Adviser or Portfolio. The Portfolio and Adviser will, however, in no way
be liable for any errors or omissions in such documents, whether or not they
make any objection thereto, except to the extent such errors or omissions
result from information provided by the Adviser or the Portfolio. The Company
will not make any other written or oral representation about the Portfolio or
the Adviser without their prior written consent.
5
(b) TAX STATUS. The Fund will qualify for treatment as a regulated
investment company under Subchapter M of the Code for all periods during which
this Agreement is in effect, except to the extent a failure to so qualify may
result from any action or omission of the Portfolio.
(c) INVESTMENT SECURITIES. The Fund will own no investment security
other than its Interest in the Portfolio.
(d) PROXY VOTING. If requested to vote on matters pertaining to the
Portfolio (other than a vote by the Company to continue the operation of the
Portfolio upon the withdrawal of another investor in the Portfolio), the
Company will (i) call a meeting of shareholders of the Fund, for the purpose of
seeking instructions from shareholders regarding such matters, (ii) vote the
Fund's Interest proportionally as instructed by Fund shareholders, and (iii)
vote the Fund's Interest with respect to the shares held by Fund shareholders
who do not give voting instructions in the same proportion as the shares of
Fund shareholders who do give voting instructions. The Company will hold each
such meeting of Fund shareholders of each Class in accordance with a timetable
reasonably established by the Portfolio.
(e) INSURANCE. The Company shall at all times maintain errors and
omissions liability insurance with respect of the Fund covering losses for
negligence and wrongful acts in an amount not less than $5 million.
(f) AUDITORS. In the event the Fund's independent public accountants
differ from those of the Portfolio, the Fund shall be responsible for any
reasonable costs and expenses associated with the need for the Portfolio's
independent public accountants to provide information to the Fund's independent
public accountants.
4.2 INDEMNIFICATION BY USAA.
(a) USAA will indemnify and hold harmless the Portfolio, the Adviser,
and their respective trustees, directors, officers and employees and each other
person who controls the Portfolio or the Adviser, as the case may be, within
the meaning of Section 15 of the 1933 Act (each, a "Covered Person" and
collectively, "Covered Persons"), against any and all losses, claims, demands,
damages, liabilities and expenses (each, a "Liability" and collectively, the
"Liabilities") (including, unless USAA elects to assume the defense pursuant to
paragraph (b), the reasonable cost of investigating and defending against any
claims therefor and any counsel fees incurred in connection therewith), joint
or several, which
(i) arise out of or are based upon any of the Securities Laws, any
other statute or common law or are incurred in connection with or as a result
of any formal or informal administrative proceeding or investigation by a
regulatory agency, in each case applicable to the Fund, insofar as such
Liabilities arise out of or are based upon the ground or alleged ground that
any direct or indirect omission or act by the Company or each Class of the Fund
(either during the course of its daily activities or in connection with the
accuracy of its representations or its warranties in this Agreement) caused or
continues to cause the Portfolio to violate any federal or state securities
laws or regulations or any other applicable domestic or foreign law or
regulations or common law duties or obligations, but only to the extent that
such Liabilities do not arise out of
6
or are not based upon an omission or act of the Portfolio or Adviser;
(ii) arise out of the Fund having caused the Portfolio to be an
association taxable as a corporation rather than a partnership;
(iii) arise out of any misstatement of a material fact or an omission
of a material fact in the Company's registration statement (including
amendments thereto) or included in Fund advertising or sales literature, other
than information provided by the Portfolio or the Adviser or included in Fund
advertising or sales literature at the request of the Portfolio or the Adviser;
(iv) result from the failure of any representation or warranty made by
the Company or USAA to be accurate when made or the failure of the Company or
USAA to perform any covenant contained herein or to otherwise comply with the
terms of this Agreement;
(v) arise out of any unlawful or negligent act of the Company, USAA or
any director, officer, employee or agent of the Company or USAA, whether such
act was committed against the Company, the Portfolio, the Adviser or any third
party;
(vi) arise out of any claim that the use of the names "Standard &
Poor's," "S&P," "Standard & Poor's 500" or "500" by the Company violates any
license or infringes upon any trademark; or
(vii) result from any Liability of the Fund which the Portfolio is
also liable; provided, however, that in no case shall USAA be liable with
respect to any claim made against any Covered Person unless the Covered Person
shall have notified USAA in writing of the nature of the claim within a
reasonable time after the summons, other first legal process or formal or
informal initiation of a regulatory investigation or proceeding shall have been
served upon or provided to a Covered Person, or any federal, state or local tax
deficiency has come to the attention of the Adviser, the Portfolio or a Covered
Person. Failure to notify USAA of such claim shall not relieve it from any
liability that it may have to any Covered Person otherwise than on account of
the indemnification contained in this Section.
(b) USAA 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 USAA elects to assume the defense, such
defense shall be conducted by counsel chosen by USAA. In the event USAA elects
to assume the defense of any such suit and retain such counsel, each Covered
Person and any other defendant or defendants may retain additional counsel, but
shall bear the fees and expenses of such counsel unless (A) USAA shall have
specifically authorized the retaining of such counsel or (B) the parties to
such suit include any Covered Person and USAA and any such Covered Person has
been advised by counsel that one or more legal defenses may be available to it
that may not be available to USAA in which case USAA shall not be entitled to
assume the defense of such suit notwithstanding its obligation to bear the fees
and expenses of such counsel. USAA shall not be liable to indemnify any Covered
Person for any settlement of any claim affected without USAA's written consent,
which consent shall not be unreasonably withheld or delayed. The indemnities
set forth in paragraph (a) will be in addition to any liability that the
Company in respect of the Fund might otherwise have to a Covered Person.
7
4.3 THE PORTFOLIO. The Portfolio covenants that:
(a) ADVANCE REVIEW OF CERTAIN DOCUMENTS. The Portfolio will furnish
the Company and USAA, at least 10 business days prior to filing or first use,
as the case may be, with drafts of its registration statement on Form N-1A
(including amendments). The Portfolio will not make any written or oral
representation about the Company or USAA without their prior written consent.
(b) TAX STATUS. The Portfolio will qualify to be taxable as a
partnership under the Code for all periods during which this Agreement is in
effect, except to the extent that the failure to so qualify results from any
action or omission of the Fund.
(c) INSURANCE. The Portfolio shall at all times maintain errors and
omissions liability insurance covering losses for negligence and wrongful acts
in an amount not less than $5 million.
(d) AVAILABILITY OF INTERESTS. Conditional upon the Company complying
with the terms of this Agreement, the Portfolio shall permit the Fund to make
additional Investments in the Portfolio on each business day on which shares of
the Fund are sold to the public; provided, however, that the Portfolio may
refuse to permit the Fund to make additional Investments in the Portfolio on
any day on which (i) the Portfolio has refused to permit all other investors in
the Portfolio to make additional Investments in the Portfolio or (ii) the
Trustees of the Portfolio have reasonably determined that permitting additional
Investments by the Fund in the Portfolio would constitute a breach of their
fiduciary duties to the Portfolio.
4.4 INDEMNIFICATION BY THE ADVISER.
(a) The Adviser will indemnify and hold harmless the Company, USAA,
their respective directors, officers and employees and each other person who
controls the Company, the Fund or USAA, as the case may be, within the meaning
of Section 15 of the 1933 Act (each, a "Covered Person" and collectively,
"Covered Persons"), against any and all losses, claims, demands, damages,
liabilities and expenses (each, a "Liability" and collectively, the
"Liabilities") (including, unless the Adviser elects to assume the defense
pursuant to paragraph (b), the reasonable costs of investigating and defending
against any claims therefor and any counsel fees incurred directly by the
Company or USAA or indirectly by the Company or USAA through the Company's
Investment in the Portfolio, which
(i) arise out of or are based upon any of the Securities Laws, any
other statute or common law or are incurred in connection with or as a result
of any formal or informal administrative proceeding or investigation by a
regulatory agency, insofar as such Liabilities arise out of or are based upon
the ground or alleged ground that any direct or indirect omission or commission
by the Portfolio (either during the course of its daily activities or in
connection with the accuracy of its representations or its warranties in this
Agreement) caused or continues to cause the Company to violate any federal or
state securities laws or regulations or any other applicable domestic or
foreign law or regulations or common law duties or obligations, but only to the
extent that such Liabilities do not arise out of and are not based upon an
omission or commission of the Company or USAA;
(ii) arise out of or are based upon an inaccurate calculation of the
Portfolio's net asset value (whether by the Portfolio, the Adviser or any party
retained for that purpose);
8
(iii) arise out of (A) any misstatement of a material fact or an
omission of a material fact in the Portfolio's registration statement
(including amendments thereto) or included at the Adviser's or Portfolio's
request in advertising or sales literature used by the Fund, or (B) any
misstatement of a material fact or an omission of a material fact in the
registration statement or advertising or sales literature of any investor in
the Portfolio, other than the Company;
(iv) arise out of the Portfolio's or the Adviser's having caused the
Fund to fail to qualify as a regulated investment company under the Code;
(v) result from the failure of any representation or warranty made by
the Portfolio or Adviser to be accurate when made or the failure of the
Portfolio or Adviser to perform any covenant contained herein or to otherwise
comply with the terms of this Agreement;
(vi) arise out of any unlawful or negligent act by the Portfolio, the
Adviser or any director, trustee, officer, employee or agent of the Portfolio
or Adviser, whether such act was committed against the Portfolio, the Company,
USAA or any third party;
(vii) arise out of any claim that the systems, methodologies, or
technology used in connection with operating the Portfolio, including the
technologies associated with maintaining the master-feeder structure of the
Portfolio, violates any license or infringes upon any patent or trademark;
(viii) arise out of any claim that the use of the names "Standard &
Poor's," "S&P," "Standard & Poor's 500," "S&P 500" or "500" by the Portfolio
violates any license or infringes upon any trademark; or
(ix) result from any Liability of the Portfolio or any investor in the
Portfolio (or shareholder thereof), other than the Fund (and its shareholders);
PROVIDED, HOWEVER, that in no case shall the Adviser be liable with respect to
any claim made against any such Covered Person unless such Covered Person shall
have notified the Adviser in writing of the nature of the claim within a
reasonable time after the summons, other first legal process or formal or
informal initiation of a regulatory investigation or proceeding shall have been
served upon or provided to a Covered Person or any federal, state or local tax
deficiency has come to the attention of the Company, USAA or a Covered Person.
Failure to notify the Adviser of such claim shall not relieve it from any
liability that it may have to any Covered Person otherwise than on account of
the indemnification contained in this paragraph.
(b) The Adviser 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 Adviser elects to assume the defense,
such defense shall be conducted by counsel chosen by the Adviser. In the event
the Adviser elects to assume the defense of any such suit and retain such
counsel, each Covered Person and any other defendant or defendants in the suit
may retain additional counsel but shall bear the fees and expenses of such
counsel unless (A) the Adviser shall have specifically authorized the retaining
of such counsel or (B) the parties to such suit include any Covered Person and
the Adviser, and any such Covered Person has been advised by counsel that one
or more legal defenses may be available to it that may not be available to the
Adviser in which case the Adviser shall not be entitled to assume the defense
of such suit notwithstanding
9
the obligation to bear the fees and expenses of such counsel. The Adviser shall
not be liable to indemnify any Covered Person for any settlement of any such
claim effected without the Adviser's written consent which consent shall not be
unreasonably withheld or delayed. The indemnities set forth in paragraph (a)
will be in addition to any liability that the Portfolio might otherwise have to
a Covered Person.
4.5 IN-KIND REDEMPTION. In the event the Company desires to withdraw
or redeem all of the Fund's Interests in the Portfolio, unless otherwise agreed
to by the parties, the Portfolio will effect such redemption "in kind" and in
such a manner that the securities delivered to the Fund's custodian for the
account of the Fund will mirror, as closely as practicable, the composition of
the Portfolio immediately prior to such redemption. No other withdrawal or
redemption of any Interest in the Portfolio will be satisfied by means of an
"in kind" redemption except in compliance with Rule 18f-1 under the 1940 Act,
PROVIDED, HOWEVER, that for purposes of determining compliance with Rule 18f-1,
each shareholder of the Fund redeeming shares of the Fund on a particular day
will be treated as a direct holder of an Interest in the Portfolio being
redeemed that day.
4.6 REASONABLE ACTIONS. Each party covenants that it will, subject to
the provisions of this Agreement, from time to time, as and when requested by
another party or in its own discretion, as the case may be, execute and deliver
or cause to be executed and delivered all such assignments and other
instruments, take or cause to be taken such actions, and do or cause to be done
all things reasonably necessary, proper or advisable in order to consummate the
transactions contemplated by this Agreement and to carry out its intent and
purpose.
V
CONDITIONS PRECEDENT
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The obligations of each party to consummate the transactions provided
for herein shall be subject to (a) performance by the other parties of all the
obligations to be performed by the other parties hereunder on or before each
Closing, (b) all representations and warranties of the other parties contained
in this Agreement being true and correct in all material respects as of the
date hereof and, except as they may be affected by the transactions
contemplated by this Agreement, as of each date of Closing, with the same force
and effect as if made on and as of the time of such Closing, and (c) the
following further conditions that shall be fulfilled on or before each Closing:
5.1 REGULATORY STATUS. All necessary filings shall have been made with
the SEC and state securities authorities, and no order or directive shall have
been received that any other or further action is required to permit the
parties to carry out the transactions contemplated hereby.
5.2 APPROVAL OF AUDITORS. Unless precluded by applicable fiduciary
duties or the failure of the Fund's shareholders to provide necessary
ratification, the directors of the Company that are not "interested persons" of
the Company, as defined in the 1940 Act, shall have selected as the independent
certified public accountants for the Fund the independent certified public
accountants selected and ratified for the Portfolio.
5.3 INVESTMENT OBJECTIVE/RESTRICTIONS. The Fund shall have the same
investment objective and substantively the same investment restrictions as the
Portfolio.
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VI
ADDITIONAL AGREEMENTS
---------------------
6.1 NOTIFICATION OF CERTAIN MATTERS. Each party will give prompt
notice to the other parties of (a) the occurrence or non-occurrence of any
event the occurrence or non-occurrence of which would be likely to cause either
(i) any representation or warranty contained in this Agreement to be untrue or
inaccurate, or (ii) any condition precedent set forth in Article V hereof to be
unsatisfied in any material respect at the time of any Closing and (b) any
material failure of a party or any trustee, director, officer, employee or
agent thereof to comply with or satisfy any covenant, condition or agreement to
be complied with or satisfied by such person hereunder; PROVIDED, HOWEVER, that
the delivery of any notice pursuant to this Section 6.1 shall not limit or
otherwise affect the remedies available, hereunder or otherwise, to the party
receiving such notice.
6.2 ACCESS TO INFORMATION. The Portfolio and the Company shall afford
each other reasonable access at all reasonable times to such party's officers,
employees, agents and offices and to all its relevant books and records and
shall furnish each other party with all relevant financial and other data and
information as requested; PROVIDED, HOWEVER, that nothing contained herein
shall obligate the Company to provide the Portfolio with access to the books
and records of the Company relating to any series of the Company other than the
Fund, nor shall anything contained herein obligate the Company to furnish the
Portfolio with the Fund's shareholder list, except as may be required to comply
with applicable law or any provision of this Agreement.
6.3 CONFIDENTIALITY. Each party agrees that it shall hold in strict
confidence all data and information obtained from another party (unless such
information is or becomes readily ascertainable from public or published
information or trade sources) and shall ensure that its officers, employees and
authorized representatives do not disclose such information to others without
the prior written consent of the party from whom it was obtained, except if
disclosure is required by the SEC, any other regulatory body or the Fund's or
Portfolio's respective auditors, or in the opinion of counsel such disclosure
is required by law, and then only with as much prior written notice to the
other party as is practical under the circumstances.
6.4 PUBLIC ANNOUNCEMENTS. No party shall issue any press release or
otherwise make any public statements with respect to the matters covered by
this Agreement without the prior consent of the other parties hereto, which
consent shall not be unreasonably withheld; PROVIDED, HOWEVER, that consent
shall not be required if, in the opinion of counsel, such disclosure is
required by law, PROVIDED FURTHER, HOWEVER, that the party making such
disclosure shall provide the other parties hereto with as much prior written
notice of such disclosure as is practical under the circumstances.
6.5 SUB-ACCOUNTING SERVICES. The Adviser agrees to provide
sub-accounting services to the Fund on behalf of USAA at no additional cost to
USAA.
6.6 WAIVER OF FEES. The Adviser understands that the Company and USAA
have entered into this Agreement in reliance upon the Adviser's express
intention that the Adviser shall waive
11
fees to the Portfolio such that the aggregate of all fees paid to the Adviser
by the Portfolio shall not exceed .05 of 1% per annum of the Portfolio's
average daily net assets.
VII
TERMINATION, AMENDMENT AND WAIVER
---------------------------------
7.1 TERMINATION.
(a) This Agreement may be terminated by the mutual agreement of all
parties.
(b) This Agreement may be terminated at any time by the Company by
withdrawing all of the Fund's Interest in the Portfolio.
(c) This Agreement may be terminated on not less than 120 days' prior
written notice by the Portfolio to the Company and USAA.
(d) This Agreement shall terminate automatically with respect to USAA
upon the effective date of termination by the Company and this Agreement shall
terminate automatically with respect to the Adviser upon the effective date of
termination by the Portfolio.
(e) This Agreement may be terminated at any time immediately upon
written notice to the other parties in the event that formal proceedings are
instituted against another party to this Agreement by the SEC or any other
regulatory body, provided that the terminating party has a reasonable belief
that the institution of the proceeding is not without foundation and will have
a material adverse impact on the terminating party.
(f) The indemnification obligations of USAA and the Adviser set forth
in Article IV, Sections 4.2 and 4.4, respectively, shall survive the
termination of this Agreement.
7.2 AMENDMENT. This Agreement may be amended, modified or supplemented
at any time in such manner as may be mutually agreed upon in writing by the
parties.
7.3 WAIVER. At any time prior to any Closing, any party may: (a)
extend the time for the performance of any of the obligations or other acts of
the other parties hereto, (b) waive any inaccuracies in the representations and
warranties contained herein or in any document delivered pursuant hereto and
(c) waive compliance with any of the agreements or conditions contained herein.
12
VIII
DAMAGES
-------
8.1 The parties agree that, in the event of a breach of this
Agreement, the remedy of money damages would not be adequate and agree that
injunctive relief would be the appropriate relief.
IX
GENERAL PROVISIONS
------------------
9.1 NOTICES. All notices and other communications given or made
pursuant hereto shall be in writing and shall be deemed to have been duly given
or made when actually received in person or by fax, or three days after being
sent by certified or registered United States mail, return receipt requested,
postage prepaid, addressed as follows:
If to USAA or the Company: USAA Investment Management Company
00000 XxXxxxxxx Xxxxxxx, BK-B04-S
Xxx Xxxxxxx, Xxxxx 00000
Attn: Xxxx X. Xxxxxx, Esq.
Fax: (000) 000-0000
If to the Adviser: Deutsche Asset Management, Inc.
0 Xxxxx Xxxxxx Xxxxxxxxx, XX 00000
Attn: Xx. Xxxxxxx X. Xxxx
If to the Portfolio: Equity 500 Index Portfolio
c\o Deutsche Asset Management
0 Xxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attn: Xxxxxx X. Xxxxxx
Any party to this Agreement may change the identity of the person to receive
notice by providing written notice thereof to all other parties to the
Agreement.
9.2 EXPENSES. All costs and expenses incurred in connection with this
Agreement and the transactions contemplated hereby shall be paid by the party
incurring such costs and expenses.
9.3 HEADINGS. The headings and captions contained in this Agreement
are for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
9.4 SEVERABILITY. If any term or other provision of this Agreement is
invalid, illegal or incapable of being enforced by any rule of law, or public
policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the
13
economic or legal substance of the transactions contemplated hereby is not
affected in any manner adverse to any party. Upon such determination that any
term or other provision is invalid, illegal or incapable of being enforced, the
parties hereto shall negotiate in good faith to modify this Agreement so as to
effect the original intent of the parties as closely as possible in an
acceptable manner to the end that the transactions contemplated hereby are
fulfilled to the extent possible.
9.5 ENTIRE AGREEMENT. This Agreement and the agreements and other
documents delivered pursuant hereto set forth the entire understanding between
the parties concerning the subject matter of this Agreement and incorporate or
supersede all prior negotiations and understandings. There are no covenants,
promises, agreements conditions or understandings, either oral or written,
between them relating to the subject matter of this Agreement other than those
set forth herein. No representation or warranty has been made by or on behalf
of any party to this Agreement (or any officer, director, trustee, employee or
agent thereof) to induce any other party to enter into this Agreement or to
abide by or consummate any transactions contemplated by any terms of this
Agreement, except representations and warranties expressly set forth herein.
9.6 SUCCESSORS AND ASSIGNMENTS. Each and all of the provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and, except as otherwise specifically provided in this Agreement, their
respective successors and assigns. Notwithstanding the foregoing, no party
shall make any assignment of this Agreement or any rights or obligations
hereunder without the written consent of all other parties. As used herein, the
term "assignment" shall have the meaning ascribed thereto in the 1940 Act.
9.7 GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York without giving effect to
the choice of law or conflicts of law provisions thereof.
9.8 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, all of which shall constitute one and the same instrument, and
any party hereto may execute this Agreement by signing one or more
counterparts.
9.9 THIRD PARTIES. Nothing herein expressed or implied is intended or
shall be construed to confer upon or give any person, other than the parties
hereto and their successors or assigns, any rights or remedies under or by
reason of this Agreement.
9.10 INTERPRETATION. Any uncertainty or ambiguity existing herein
shall not presumptively be interpreted against any party, but shall be
interpreted according to the application of the rules of interpretation for
arm's length agreements.
9.11 LIMITATION OF LIABILITY. The parties hereby acknowledge that the
Company has entered into this Agreement solely on behalf of the Fund and that
no other series of the Company shall have any obligation hereunder with respect
to any liability of the Company arising hereunder.
14
IN WITNESS WHERFOF, the parties have caused this Agreement to he
executed by their respective officers, thereunto duly authorized, as of the
date first written above.
USAA INVESTMENT MANAGEMENT
BY: /S/ XXXXXXXXXXX X. XXXXX
------------------------
Name: Xxxxxxxxxxx X. Xxxxx
Title: President
USAA MUTUAL FUND, INC.
on behalf of itself and the
USAA S&P 500 INDEX FUND,
a series thereof
By: /S/ XXXXX X. PEELBES
----------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President
EQUITY 500 INDEX PORTFOLIO
By: /S/ XXXXXX X. XXXXXX
----------------------
Name: Xxxxxx X. Xxxxxx
Title: Secretary
DEUTSCHE ASSET MANAGEMENT, INC.
By: /S/ XXXXXXX X. XXXX
-----------------------
Name: Xxxxxxx X. Xxxx
Title: Vice President
15
EXHIBIT 8(z)
Exhibit
USAA Transfer Agency Company
00000 Xxxxxx X. XxXxxxxxx Xxxxxxx
Xxx Xxxxxxx, XX 00000
Gentlemen:
Pursuant to Section 27 of the Transfer Agency Agreement dated as of
January 23, 1992 between USAA Mutual Fund, Inc. (the "Company") and USAA
Transfer Agency Company, (the "Transfer Agent") please be advised that the
Company has established one new series of its shares, namely, the Value Fund
(the "Fund"), and please be further advised that the Company desires to retain
the Transfer Agent to render transfer agency services under the Transfer Agency
Agreement to the Fund in accordance with the fee schedules attached hereto as
Exhibit A.
Please state below whether you are willing to render such services in
accordance with the fee schedules attached hereto as Exhibit A.
USAA MUTUAL FUND, INC.
Attest: By:
------------------------------ --------------------------------
Xxxxxxx X. Xxxxxx Xxxxxxxxxxx X. Xxxxx
Secretary President
Dated: ___________________________
We are willing to render services to the Value Fund in accordance with
the fee schedules attached hereto as Exhibit A.
USAA TRANSFER AGENCY COMPANY
Attest: By:
------------------------------ --------------------------------
Xxxx X. Xxxxxx Xxxxx X. Xxxxxxxxx
Assistant Secretary Senior Vice President
Dated:
---------------------------------
EXHIBIT 8(aa)
USAA Transfer Agency Company
Fee Information for Services as
Plan, Transfer and Dividend Disbursing Agent
USAA MUTUAL FUND, INC.
Value Fund
-------------------------------------------------------------------------------
GENERAL - Fees are based on an annual per shareholder account charge for
account maintenance plus out-of-pocket expenses. There is a minimum charge of
$2,000 per month applicable to the entire fund complex.
ANNUAL MAINTENANCE CHARGES - The annual maintenance charge includes the
processing of all transactions and correspondence. The fee is billable on a
monthly basis at the rate of 1/12 of the annual fee. USAA Transfer Agency
Company will charge for each open account from the month the account is opened
through January of the year following the year all funds are redeemed from the
account.
Value Fund - charge per account $23.00
USAA MUTUAL FUND, INC. USAA TRANSFER AGENCY COMPANY
Value Fund
By: By:
----------------------------------- ------------------------------
Xxxxxxxxxxx X. Xxxxx Xxxxx Xxxxxxxxx
President Vice President
Date: Date:
------------------------------ ----------------------------