TOUCHSTONE
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TOUCHSTONE FAMILY OF FUNDS
000 Xxxx Xxxxxx Xxxxxx, Xxx. 000
Xxxxxxxxxx, XX 00000
ADMINISTRATION AGREEMENT
This Agreement is made between -----------------------("Administrator")and
Touchstone Securities, Inc. (TSI), as distributor for the Touchstone Investment
Trust, Touchstone Tax-Free Trust and Touchstone Strategic Trust (collectively
the "Trusts" and individually the "Trust"), the issuer of shares of beneficial
interest ("Shares") of the mutual funds set forth on Schedule A to this
Agreement (collectively the "Funds" and individually the "Fund"). In
consideration of the mutual covenants hereinafter contained, it is hereby agreed
by and between the parties hereto as follows:
1. The Trusts hereby appoint Administrator to render or cause
to be rendered administrative support services to each Fund and its
Client-shareholders, which services may include, without limitation: aggregating
and processing purchase and redemption requests and placing net purchase and
redemption orders with the Fund's transfer agent; answering client inquiries
about the Fund and referring to the Trusts those inquiries which the
Administrator is unable to answer; assisting clients in changing dividend
options, account designations and addresses; performing sub-accounting;
establishing, maintaining and closing shareholder accounts and records;
investing client account cash balances automatically in Shares of the Fund;
providing periodic statements showing a client's account balance, integrating
such statements with those of other transactions and balances in the client's
other accounts serviced by the Administrator and performing such other
recordkeeping as is necessary for the Fund's transfer agent to comply with all
the recordkeeping requirements of the Investment Company Act of 1940 and the
regulations promulgated thereunder including the provisions outlined in Exhibit
B and C; arranging for bank wires; and providing such other information and
services as the Trusts reasonably may request, to the extent the Administrator
is permitted by applicable statute, rule or regulation to provide these
services.
2. Administrator shall provide such office space and equipment,
telephone facilities and personnel (which may be all or any part of the space,
equipment and facilities currently used in Administrator's business, or all or
any personnel employed by Administrator) as is necessary or beneficial for
providing information and services to Client-shareholders of each Fund, and to
assist each Trust in servicing accounts of clients. Administrator shall transmit
promptly to clients all communications sent to it for transmittal to clients by
or on behalf of a Trust, a Fund, or a Trust's investment adviser, custodian or
transfer agent or dividend disbursing agent.
3. Administrator agrees to comply with the requirements of all
laws applicable to it, including but not limited to, ERISA, federal and state
securities laws and the rules and regulations promulgated thereunder.
Administrator agrees to provide services to each Trust in compliance with the
then current Prospectus and Statement of Additional Information of the Trust and
the operating procedures and policies established by the Trust, including, but
not limited to, required minimum investment and minimum account size.
4. No person is authorized to make any representations
concerning a Fund or its Shares except those contained in the current Prospectus
or Statement of Additional Information of the applicable Fund and any such
information as may be officially designated as information supplemental to the
Prospectus. Additional copies of any Prospectus and any printed information
officially designated as supplemental to such Prospectus will be supplied by the
Trusts to Administrator in reasonable quantities on request.
5. Administrator agrees that it will provide administrative
support services only to those persons who reside in any jurisdiction in which a
Fund's Shares are registered for sale and in which the Administrator may
lawfully provide such services. Upon request, the Trusts shall provide the
Administrator with a list of the states in which each Fund's Shares are
registered for sale and shall keep such list updated.
6. In no transaction shall Administrator have any authority
whatsoever to act as agent for any Trust, any Fund or any person affiliated
with any Trust or Fund.
7. The Administrator agrees not to solicit or cause to be
solicited directly, or indirectly at any time in the future, any proxies from
the Client-shareholders of a Trust in opposition to proxies solicited by
management of the Trust, unless a court of competent jurisdiction shall have
determined that the conduct of a majority of the Board of Trustees of the Trust
constitutes willful misfeasance, bad faith, gross negligence or reckless
disregard of their duties. This paragraph 8 will survive the term of this
Agreement.
8. The Administrator shall prepare such quarterly reports for
each Trust as shall reasonably be requested by the Trust. In addition, the
Administrator will furnish the Trust or its designees with such information as
the Trust or they may reasonably request (including, without limitation,
periodic certifications confirming the provision to clients of the services
described herein), and will otherwise cooperate with the Trust and its designees
(including and without limitation, any auditors designated by the Trust), in
connection with the preparation of reports to the Trust's Board of Trustees
concerning this Agreement and the monies paid or payable by the Trust or the
Trust's underwriter pursuant hereto, as well as any other reports or filings
that may be required by law.
9. The Administrator acknowledges that any Trust may enter
into similar agreements with others without the consent of the Administrator.
10. Each Trust reserves the right, at its discretion and without
notice,to suspend the sale of Shares or withdraw the sale of Shares of any Fund.
11. With respect to each Fund, this Agreement shall continue in
effect for one year from the date of its execution, and thereafter for
successive periods of one year if the form of the Agreement is approved as to
the Fund at least annually by the Trustees of the applicable Trust, including a
majority of the members of the Board of Trustees of the Trust who are not
interested persons ("Disinterested Trustees") of the Trust and have no direct of
indirect financial interest in the operations of the Trust's Rule 12b-1 Plan
("Plan") or in any documents related to the Plan cast in person at a meeting for
that purpose. In the event this Agreement, or any part thereof, is found invalid
or is ordered terminated by any regulatory or judicial authority, or the
Administrator shall fail to perform the shareholder servicing and administrative
functions contemplated hereby, this Agreement is terminable effective upon
receipt of notice thereof by the Administrator.
12. Notwithstanding paragraph 12, this Agreement may be terminated
with respect to any Fund as follows:
(a) at any time, without the payment of any penalty, by the vote
of a majority of the Disinterested Trustees of the applicable Trust or by
a vote of a majority of the outstanding voting securities of the Fund on
not more than thirty (30) days written notice to the parties to this
Agreement;
(b) automatically in the event of the Agreement's assignment as
defined in the Investment Company Act of 1940; or
(c) by any party to the Agreement without cause by giving the
other parties at least thirty (30) days written notice of its intention
to terminate.
13. Any termination of this Agreement shall not affect the
provisions of paragraph 16, which shall survive the termination of this
Agreement and continue to be enforceable thereafter.
14. This Agreement shall inure to the benefit of and be binding
upon the parties hereto and their respective successors.
15. This Agreement is not intended to, and shall not, create any
rights against any party hereto by any third person solely on account of this
Agreement.
16. The Administrator shall provide such security as is
necessary to prevent unauthorized use of any computer hardware or software
provided to it by or on behalf of the Trusts, if any. The Administrator agrees
to release, indemnify and hold harmless each Fund, each Trust, each Trust's
transfer agent, custodian and underwriter, and their respective principals,
directors, trustees, officers, employees and agents from any and all direct or
indirect liabilities or losses resulting from requests, directions, actions or
inactions of or by the Administrator, its officers, employees or agents
regarding the purchase, redemption, transfer or registration of Shares for
accounts of the Administrator, its clients and other Client-shareholders. Such
indemnity shall also cover any losses and liabilities incurred by and resulting
from the Administrator's performance of or failure to perform its obligations or
its breach of any representations or warranties under this Agreement. Principals
of the Administrator will be available to consult from time to time with each
Trust concerning the administration and performance of the services contemplated
by this Agreement.
17. This Agreement may be amended only by an agreement in writing
signed by the Administrator and the Trusts.
18. The obligations of each Trust under this Agreement shall not
be binding upon any of the Trustees, Client-shareholders, nominees, officers,
agents or employees of such Trust, personally, but shall bind only the property
of such Trust, as provided in such Trust's Agreement and Declaration of Trust.
The execution and delivery of this Agreement has been authorized by the Trustees
and signed by a duly authorized officer of the Trusts, acting as such, and
neither the authorization by the Trustees nor the execution and delivery by such
officer of the Trusts shall be deemed to have been made by any of them
individually or to impose any liability on any of them personally, but shall
bind only the property of the Trusts as provided in their Agreement and
Declaration of Trust.
19. This Agreement does not authorize the Administrator to
participate in any activities relating to the sale or distribution of the
Shares, and the Administrator agrees that it shall not participate in such
activities.
20. Administrator has adopted and implemented procedures to
safeguard customer information and records that are reasonably designed to: (1)
ensure the security and confidentiality of customer records and information; (2)
protect against any anticipated threats or hazards to the security or integrity
of customer records and information; (3) protect against unauthorized access to
or use of customer records or information that could result in substantial harm
or inconvenience to any customer; (4) protect against unauthorized disclosure of
non-public personal information to unaffiliated third parties; and (5) otherwise
ensure compliance with the Securities and Exchange Commission's Regulation S-P.
Administrator agrees to indemnify the Trusts against any and all claims,
liability, expense or loss in any way arising out of the failure to adopt and
implement these and such other privacy or confidentiality procedures that may in
the future be required by law or regulation.
21. If any provision of this Agreement, or any covenant,
obligation or agreement contained herein, is determined by a court to be invalid
or unenforceable, the parties agree that (a) such determination shall not affect
any other provision, covenant, obligation or agreement contained herein, each of
which shall be construed and enforced to the full extent permitted by law, and
(b) such invalid or unenforceable portion shall be deemed to be modified to the
extent necessary to permit its enforcement to the maximum extent permitted by
applicable law.
22. This Agreement shall be construed in accordance with the laws
of the State of Ohio.
IN WITNESS WHEREOF, this Agreement has been executed for the Trusts and
the Administrator by their duly authorized officers, on this _____ day of
_________________, ______.
ACCEPTED BY ADMINISTRATOR TOUCHSTONE SECURITIES, INC.
By: ______________________________________________ By: ________________________________________
Authorized Signature Authorized Signature
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Type or Print Name, Position Type or Print Name, Position
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Administrator Name
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Address
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Address
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Phone
Schedule A
SCHEDULE OF MUTUAL FUNDS
Touchstone Investment Trust Class of Shares
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High Yield Fund Class A Shares
Bond Fund Class A Shares
Short Term Government Income Fund Class A Shares
Money Market Fund Class A Shares
Intermediate Term Government Income Fund Class A Shares
Touchstone Tax-Free Trust
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Ohio Tax-Free Money Fund - Retail Class A Shares
Tax-Free Money Fund Class A Shares
California Tax-Free Money Fund - Retail Class A Shares
Florida Tax-Free Money Fund - Retail Class A Shares
Tax-Free Intermediate Term Fund Class A Shares
Ohio Insured Tax-Free Fund Class A Shares
Touchstone Strategic Trust
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International Equity Fund Class A Shares
Emerging Growth Fund Class A Shares
Growth/Value Fund Class A Shares
Aggressive Growth Fund Class A Shares
Equity Fund Class A Shares
Enhanced 30 Fund Class A Shares
Value Plus Fund Class A Shares
Utility Fund Class A Shares
EXHIBIT B
FUND/SERV PROCESSING PROCEDURES
AND
MANUAL PROCESSING PROCEDURES
The purchase, redemption and settlement of Shares of a Fund will normally follow
the Fund/SERV-Defined Contribution Clearance and Settlement Service ("DCCS")
Processing Procedures below and the rules and procedures of the SCC Division of
the National Securities Clearing Corporation ("NSCC") shall govern the purchase,
redemption and settlement of Shares of the Funds through NSCC by the
Administrator. In the event of equipment failure or technical malfunctions or
the parties' inability to otherwise perform transactions pursuant to the
FUND/SERV Processing Procedures, or the parties' mutual consent to use manual
processing, the Manual Processing Procedures below will apply.
It is understood and agreed that, in the context of Section 22 of the 1940 Act
and the rules and public interpretations thereunder by the staff of the
Securities and Exchange Commission (SEC Staff), receipt by the Administrator of
any Instructions from the Client-shareholder price prior to the Close of Trade
on any Business Day shall be deemed to be receipt by the Funds of such
Instructions solely for pricing purposes and shall cause purchases and sales to
be deemed to occur at the Share Price for such Business Day, except as provided
in 4(c) of the Manual Processing Procedures. Each Instruction shall be deemed to
be accompanied by a representation by the Administrator that it has received
proper authorization from each Client-shareholder whose purchase, redemption,
account transfer or exchange transaction is effected as a result of such
Instruction.
FUND/SERV-DCCS PROCESSING PROCEDURES
1. On each business day that the New York Stock Exchange (the
"Exchange") is open for business on which the Funds determine their net
asset values ("Business Day"), the Distributor shall accept, and effect
changes in its records upon receipt of purchase, redemption, exchanges,
account transfers and registration instructions from the Administrator
electronically through Fund/SERV ("Instructions") without supporting
documentation from the Client-shareholder. On each Business Day, the
Distributor shall accept for processing any Instructions from the
Administrator and shall process such Instructions in a timely manner.
2. Distributor shall perform any and all duties, functions,
procedures and responsibilities assigned to it under this Agreement and
as otherwise established by the NSCC. Distributor shall conduct each of
the foregoing activities in a competent manner and in compliance with
(a) all applicable laws, rules and regulations, including NSCC
Fund/SERV-DCCS rules and procedures relating to Fund/SERV, (b) the
then-current Prospectus of a Fund; and (c) any provision relating to
Fund/SERV in any other agreement of the Distributor that would affect
its duties and obligations pursuant to this Agreement.
3. Confirmed trades and any other information provided by the
Distributor to the Administrator through Fund/SERV and pursuant to this
Agreement shall be accurate, complete, and in the format prescribed by
the NSCC.
4. Trade, registration, and Administrator information provided by
the Administrator to the Distributor through Fund/SERV and pursuant to
this Agreement shall be accurate, complete and, in the format
prescribed by the NSCC. All instructions by the Administrator regarding
each Fund/SERV Account shall be true and correct and will have been
duly authorized by the registered holder.
5. For each Fund/SERV transaction, including transactions
establishing a Client-shareholder account with the Distributor, the
Administrator shall provide the Funds and the Distributor information
necessary or appropriate to establish and maintain each Fund/SERV
transaction (and any subsequent changes to such information), which the
Administrator hereby certifies is and shall remain true and correct.
The Administrator shall maintain documents required by the Funds to
effect Fund/SERV transactions. The Administrator certifies that all
Instructions delivered to Distributor on any Business Day shall have
been received by the Administrator from the Client-shareholder by the
close of trading (generally 4:00 p.m. Eastern Time ("ET")) on the New
York Stock Exchange (the "Close of Trading") on such Business Day
and that any Instructions received by it after the Close of Trading on
any given Business Day will be transmitted to Distributor on the next
Business Day.
Manual Processing Procedures
1. On each Business Day, the Administrator may receive
Instructions from the Client-shareholder for the purchase or redemption
of shares of the Funds based solely upon receipt of such Instructions
prior to the Close of Trading on that Business Day. Instructions in
good order received by the Administrator prior to the close of trading
on any given Business Day (generally, 4:00 p.m. ET (the "Trade Date")
and transmitted to the Distributor by no later than 8:00 a.m. ET the
Business Day following the Trade Date ("Trade Date plus One" or
"TD+1"), will be executed at the applicable NAV ("Share Price") of each
applicable Fund, determined as of the Close of Trading on the Trade
Date.
2. By no later than 6:00 p.m. ET on each Trade Date ("Price
Communication Time"), the Distributor will use its best efforts to
communicate to the Administrator via electronic transmission acceptable
to both parties, the Share Price of each applicable Fund, as well as
dividend and capital gain information and, in the case of funds that
credit a daily dividend, the daily accrual for interest rate factor
(mil rate), determined at the Close of Trading on that Trade Date.
3. As noted in Paragraph 1 above, by 8:00 a.m. ET on TD+1
("Instruction Cutoff Time") and after the Administrator has processed
all approved transactions, the Administrator will transmit to the
Distributor via facsimile, telefax or electronic transmission or
system-to-system, or by a method acceptable to the Administrator and
the Distributor, a report (the "Instruction Report") detailing the
Instructions that were received by the Administrator prior to the
Funds' daily determination of Share Price for each Fund (i.e., the
Close of Trading) on Trade Date.
(a) It is understood by the parties that all Instructions from the
Client-shareholder shall be received and processed by the
Administrator in accordance with its standard transaction
processing procedures. The Administrator or its designees
shall maintain records sufficient to identify the date and
time of receipt of all Client-shareholder transactions
involving the Funds and shall make or cause to be made such
records available upon reasonable request for examination by
the Funds or its designated representative or, at the request
of the Funds, by appropriate governmental authorities. Under
no circumstances shall the Administrator change, alter or
modify any Instructions received by it in good order.
(b) Following the completion of the transmission of any
Instructions by the Administrator to the Distributor by the
Instruction Cutoff Time, the Administrator will verify that
the Instruction was received by the Distributor and trades are
pending by utilizing a remote terminal or such other method
acceptable to the Distributor.
(c) In the event that an Instruction transmitted by the
Administrator on any Business Day is not received by the
Distributor by the Instruction Cutoff Time, due to mechanical
difficulties or for any other reason beyond the
Administrator's reasonable control, such Instruction shall
nonetheless be treated by the Distributor as if it has been
received by the Instruction Cutoff Time, provided that the
Administrator retransmits such Instruction by facsimile
transmission to the Distributor and such Instruction is
received by the Distributor's financial control representative
no later than 8:00 a.m. ET on TD+1. In addition, the
Administrator will place a phone call to a financial control
representative of the Distributor prior to 8:00 a.m. ET on
TD+1 to advise the Distributor that a facsimile transmission
concerning the Instruction is being sent.
(d) With respect to all Instructions, the Distributor's
financial control representative will manually adjust a Fund's
records for the Trade Date to reflect any Instructions sent by
the Administrator.
(e) By no later than 4:00 p.m. on TD+1, and based on the
information transmitted to the Distributor pursuant to
Paragraph 3(c) above, the Administrator will use its best
efforts to verify that all Instructions provided to the
Distributor on TD+1 were accurately received and that the
trades for each Account were accurately completed and the
Administrator will use its best efforts to notify Distributor
of any discrepancies.
4. As set forth below, upon the timely receipt from the Administrator of
the Instructions, the Fund will execute the purchase or redemption
transactions (as the case may be) at the Share Price for each Fund
computed as of the Close of Trading on the Trade Date.
(a) Except as otherwise provided herein, all purchase and
redemption transactions will settle on TD+1. Settlements will
be through net Federal Wire transfers to an account designated
by a Fund. In the case of Instructions which constitute a net
purchase order, settlement shall occur by the Administrator
instructing the trustee or custodian for the Plans to initiate
a wire transfer by 1:00 p.m. ET on TD+1 to the custodian for
the Fund for receipt by the Funds' custodian by no later than
the Close of Business at the New York Federal Reserve Bank on
TD+1, causing the remittance of the requisite funds to the
Distributor to cover such net purchase order. In the case of
Instructions which constitute a net redemption order,
settlement shall occur by the Distributor causing the
remittance of the requisite funds to cover such net redemption
order by Federal Funds Wire by 1:00 p.m. ET on TD+1, provided
that the Fund reserves the right to (i) delay settlement of
redemptions for up to seven (7) Business Days after receiving
a net redemption order in accordance with Section 22 of the
1940 Act and Rule 22c-1 thereunder, or (iii) suspend
redemptions pursuant to the 1940 Act or as otherwise required
by law. Settlements shall be in U.S. dollars and a Fund may
pay redemption proceeds in whole or in part by a distribution
in-kind of readily marketable securities that it holds in lieu
of cash in conformity with applicable law or regulations.
(b) The Administrator or such other party as may be
designated, as record owner of each account ("Record Owner")
will be provided with all written confirmations required under
federal and state securities laws.
(c) On any Business Day when the Federal Reserve Wire
Transfer System is closed, all communication and processing
rules will be suspended for the settlement of Instructions.
Instructions will be settled on the next Business Day on which
the Federal Reserve Wire Transfer System in open. The original
TD+1 Settlement Date will not apply. Rather, for purposes of
this Paragraph 4(c) only, the Settlement Date will be the date
on which the Instruction settles.
(d) The Administrator shall, upon receipt of any
confirmation or statement concerning the accounts, promptly
verify by use of the terminal or by such other method
acceptable to the Distributor and the Administrator the
accuracy of the information contained therein against the
information contained in the Administrator's internal
record-keeping system and shall promptly, but in no event not
more than seven days, advise the Distributor in writing of any
discrepancies between such information. The Distributor and
the Administrator shall cooperate to resolve any such
discrepancies as soon as reasonably practicable.
INDEMNIFICATION
In the event of any error or delay with respect to both the Fund/SERV Processing
Procedures and the Manual Processing Procedures outlined in Exhibit C herein:
(i) which is caused by the Funds or the Distributor, the Distributor shall make
any adjustments on the Funds' accounting system necessary to correct such error
or delay and the responsible party or parties shall reimburse the
Client-shareholder and the Administrator, as appropriate, for any losses or
reasonable costs incurred directly as a result of the error or delay but
specifically excluding any and all consequential punitive or other indirect
damages or as provided for in Exhibit D (ii) which is caused by the
Administrator or by any Client-shareholder or the Distributor shall make any
adjustment on the Funds' accounting system necessary to correct such error or
delay and the affected party or parties shall be reimbursed by the Administrator
for any losses or reasonable costs incurred directly as a result of the error or
delay, but specifically excluding any and all consequential punitive or other
indirect damages. In the event of any such adjustments on the Funds' accounting
system, Administrator shall make the corresponding adjustments on its internal
record-keeping system. In the event that errors or delays with respect to the
Procedures are contributed to by more than one party hereto, each party shall be
responsible for that portion of the loss or reasonable cost which results from
its error or delay. All parties agree to provide the other parties prompt notice
of any errors or delays of the type referred to herein and to use reasonable
efforts to take such action as may be appropriate to avoid or mitigate any such
costs or losses.
EXHIBIT C
TOUCHSTONE SECURITIES, INC.
AS-OF PROCESSING POLICY
Touchstone Securities, Inc. will employ, through its Transfer Agent, As Of
policies that are consistent with those adopted by the Touchstone Family of
Funds Board of Trustees. This policy shall be effective on May 1, 2001.
An "as-of" trade occurs whenever a current Client-shareholder trade is processed
at a previously issued public offering price. In order to not disadvantage
existing Cleint-shareholders from the possible losses to a fund (each portfolio
treated separately) generated by such trades, the policy outlined below is to be
followed.
1. No "as-of" trades will be accepted from a Administrator or
service agents without prior receipt of signature guaranteed
indemnification against any losses to the fund signed by the
Administrator or service agent placing the trade (see attached "Letter
of Indemnity").
2. Administrators and service agents will be billed for any loss
of $50 or more resulting from a single transaction. Administrators will
not be able to use any prior gains to the fund generated by their
"as-of" transactions to offset transaction losses. Invoices for losses
are due and payable upon receipt.
3. Immediate payment is to be made to the fund by the responsible
Administrator or service agent at anytime in which the impact of an As
Of trade results in a material loss to the fund or more than $.005 per
share of the fund's net asset value.
4. The Fund's Transfer Agent shall reserve the right to refuse any
request to process any As Of transaction requested by a Administrator
or service agent.
5. The Fund's Transfer Agent may at its discretion reduce
commissions or 12b-1 payments due to a Administrator or service agent
by an amount equal to losses invoiced to the Administrator or service
agent for failure to pay invoices for losses caused by requested As Of
trades.
LETTER OF INDEMNITY
FROM:--------------------
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RE: Name of Fund _____________________
Account Number __________________
Registration _____________________
DATE: _______________
Please process the following instruction in accordance with the instructions
below:
Effective Date:______________ Supporting Documents
Attached: Yes____ No____
INSTRUCTIONS:____________________________________________________
In consideration of your actions based upon the above instructions, the
undersigned firm hereby agrees to indemnify and hold harmless Touchstone Family
of Funds and its Transfer Agent, Custodian, Distributor, other agents and the
Trustees, Directors, officers, employees, and agents thereof with respect to any
and all losses, damages, liabilities, claims, reasonable attorney fees, costs,
or expenses that may be assessed against or suffered or incurred by any of them,
howsoever they arise, which relates in any way to the above special
instructions.
Sincerely,
---------------------------------
Firm Name
By:______________________________ Transfer Agent Approvals:
Authorized Person/Title
Signature Guarantee Stamp (Required) _____________________
