Exhibit (13)(n)
CO-ADMINISTRATION AND ACCOUNTING SERVICES AGREEMENT
THIS AGREEMENT is made as of June 1, 2003 by and among PFPC Inc., a
Massachusetts corporation ("PFPC"), National City Bank ("NCB"), a national
banking association, and each of Armada Funds and Armada Advantage Fund, each a
Massachusetts business trust (each a "Fund" and together the "Funds"), each such
Fund acting severally on its own behalf and not jointly with such other Fund.
W I T N E S S E T H:
WHEREAS, each Fund is registered as an open-end management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act");
and
WHEREAS, each Fund wishes to retain PFPC and NCB to provide
co-administration and accounting services to its investment portfolios listed on
Exhibit A attached hereto and made a part hereof, as such Exhibit A may be
amended from time to time (each a "Portfolio"), and each of PFPC and NCB wishes
to furnish such services.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, and intending to be legally bound hereby the parties
hereto agree as follows:
1. DEFINITIONS. AS USED IN THIS AGREEMENT:
(a) "1933 Act" means the Securities Act of 1933, as amended.
(b) "1934 Act" means the Securities Exchange Act of 1934, as amended.
(c) "Authorized Person" means any officer of a Fund and any other
person duly authorized by the Fund's Board of Trustees to give Oral
Instructions and Written Instructions on behalf of the Fund. An
Authorized Person's scope of authority may be limited by setting
forth such limitation in a written document signed by both parties
hereto.
(d) "CEA" means the Commodities Exchange Act, as amended.
(e) "Co-Administrators" means PFPC and NCB, collectively, and
"Co-Administrator" means PFPC or NCB, individually.
(f) "Oral Instructions" mean oral instructions received by a
Co-Administrator from an Authorized Person or from a person
reasonably believed by the Co-Administrator to be an Authorized
Person. A Co-Administrator may, in its sole discretion in each
separate instance, consider and rely upon instructions it receives
from an Authorized Person via electronic mail as Oral Instructions.
(g) "SEC" means the Securities and Exchange Commission.
(h) "Securities Laws" means the 1933 Act, the 1934 Act, the 1940 Act
and the CEA.
(i) "Shares" means the shares of beneficial interest of any series or
class of a Fund.
(j) "Written Instructions" mean (i) written instructions signed by an
Authorized Person and received by a Co-Administrator or (ii) trade
instructions transmitted (and received by a Co-Administrator) by
means of an electronic transaction reporting system access to which
requires use of a password or other authorized identifier. The
instructions may be delivered by hand, mail, tested telegram,
cable, telex or facsimile sending device.
-1-
2. APPOINTMENT. Each Fund hereby appoints PFPC and NCB to provide such
co-administration and accounting services to each of its Portfolios as
are customarily provided to investment companies in the industry, in
accordance with the terms set forth in Sections 15, 16, 17 and 18 of
this Agreement. Each of PFPC and NCB accepts such appointment and
agrees to furnish such services.
3. DELIVERY OF DOCUMENTS. Each Fund has provided or, where applicable,
will provide the Co-Administrators with the following:
(a) at a Co-Administrator's request, certified or authenticated copies
of the resolutions of the Fund's Board of Trustees, approving the
appointment of a Co-Administrator or its affiliates to provide
services to each Portfolio and approving this Agreement;
(b) a copy of the Fund's most recent effective registration statement;
(c) a copy of each Portfolio's advisory agreement or agreements; and
(d) copies (certified or authenticated, where applicable) of any and
all amendments or supplements to the foregoing.
4. COMPLIANCE WITH RULES AND REGULATIONS.
Each Co-Administrator undertakes to comply with all applicable
requirements of the Securities Laws, and any laws, rules and
regulations of governmental authorities having jurisdiction with
respect to it and the duties to be performed by it hereunder. Except as
specifically set forth herein, a Co-Administrator assumes no
responsibility for such compliance by a Fund or other entity. In
addition, neither Co-Administrator assumes any responsibility for such
compliance by the other Co-Administrator.
5. INSTRUCTIONS.
(a) Unless otherwise provided in this Agreement, a Co-Administrator
shall act only upon Oral Instructions or Written Instructions.
(b) A Co-Administrator shall be entitled to rely upon any Oral
Instruction or Written Instruction it receives from an Authorized
Person (or from a person reasonably believed by a Co-Administrator
to be an Authorized Person) pursuant to this Agreement. A
Co-Administrator may assume that any Oral Instruction or Written
Instruction received hereunder is not in any way inconsistent with
the provisions of organizational documents or this Agreement or of
any vote, resolution or proceeding of the Fund's Board of Trustees
or of the Fund's shareholders, unless and until a Co-Administrator
receives Written Instructions to the contrary.
(c) Each Fund agrees to forward to a Co-Administrator Written
Instructions confirming Oral Instructions (except where such Oral
Instructions are given by a Co-Administrator or its affiliates) so
that the Co-Administrator receives the Written Instructions by the
close of business on the same day that such Oral Instructions are
received. The fact that such confirming Written Instructions are
not received by the Co-Administrator or differ from the Oral
Instructions shall in no way invalidate the transactions or
enforceability of the transactions authorized by the Oral
Instructions or such Co-Administrator's ability to rely upon such
Oral Instructions.
-2-
6. RIGHT TO RECEIVE ADVICE.
(a) ADVICE OF THE FUNDS. If a Co-Administrator is in doubt as to any
action it should or should not take, it may request directions or
advice, including Oral Instructions or Written Instructions, from
the relevant Fund.
(b) ADVICE OF COUNSEL. If a Co-Administrator shall be in doubt as to
any question of law pertaining to any action it should or should
not take, it may request advice at its own cost (unless, given the
matter in question, the parties agree that such cost should
properly be borne by a Fund) from counsel of its own choosing (who
may be counsel for a Fund, a Fund's investment adviser or either
Co-Administrator, at the option of the Co-Administrator).
(c) CONFLICTING ADVICE. In the event of a conflict between directions
or advice or Oral Instructions or Written Instructions a
Co-Administrator receives from a Fund and the advice it receives
from counsel, a Co-Administrator may rely upon and follow the
advice of counsel. In the event a Co-Administrator so relies on the
advice of counsel, it shall be responsible for any action or
omission on its part in carrying out such advice which constitutes
willful misfeasance, bad faith, negligence or reckless disregard by
such Co-Administrator of any duties, obligations or
responsibilities set forth in this Agreement.
(d) PROTECTION OF THE CO-ADMINISTRATORS. A Co-Administrator shall be
indemnified by each Fund and without liability for any action it
takes or does not take in reliance upon directions or advice or
Oral Instructions or Written Instructions a Co-Administrator
receives from or on behalf of the Fund or from counsel and which a
Co-Administrator believes, in good faith, to be consistent with
those directions or advice and Oral Instructions or Written
Instructions. Nothing in this section shall be construed so as to
impose an obligation upon a Co-Administrator (i) to seek such
directions or advice or Oral Instructions or Written Instructions,
or (ii) to act in accordance with such directions or advice or Oral
Instructions or Written Instructions unless, under the terms of
other provisions of this Agreement, the same is a condition of such
Co-Administrator's properly taking or not taking such action.
Nothing in this subsection shall excuse a Co-Administrator when an
action or omission on its part in carrying out such directions,
advice, Oral Instructions or Written Instructions constitutes
willful misfeasance, bad faith, negligence or reckless disregard by
such Co-Administrator of any duties, obligations or
responsibilities set forth in this Agreement.
-3-
7. RECORDS; VISITS.
(a) The books and records pertaining to the Funds and the Portfolios
which are in the possession or under the control of a
Co-Administrator shall be the property of the appropriate Fund.
Such books and records shall be prepared and maintained as required
by the 1940 Act and other applicable laws, rules and regulations.
The Funds and Authorized Persons shall have access to such books
and records at all times during the relevant Co-Administrator's
normal business hours. Upon the reasonable request of a Fund,
copies of any such books and records shall be provided by the
relevant Co-Administrator to the Fund or to an Authorized Person,
at that Fund's expense.
(b) The Co-Administrators shall maintain and preserve the following
records:
(i) all books and records with respect to each Portfolio's books
of account;
(ii) records of each Portfolio's securities transactions; and
(iii) all other books and records as are required to be maintained
and preserved pursuant to Rules 31a-1, 31a-2 and 31a-3 under
the 1940 Act in connection with the services provided
hereunder.
8. CONFIDENTIALITY.
(a) "Confidential Information" means all information provided by either
party (the "Originating Party") and any of its affiliates to the
other party (the "Receiving Party") in connection with this
Agreement. Confidential Information shall include, without
limitation: (i) list(s) of customer names and addresses and other
customer-related information, regardless of whether the Originating
Party's relationship with the customer ceases, including any
nonpublic personal information as defined by federal law,
including, but not limited to, the Xxxxx-Xxxxx-Xxxxxx Act, as it
may be amended, any regulations promulgated thereunder and any
other customer information protected by applicable state law; (ii)
any data or information that is competitively sensitive material,
and not generally known to the public, including, but not limited
to, information about product plans, marketing strategies,
finances, operations, customer relationships, customer profiles,
customer lists, sales estimates, business plans, and internal
performance results relating to the past, present or future
business activities of the Funds, PFPC or NCB, their respective
subsidiaries and affiliated companies and the customers, clients
and suppliers of any of them; (iii) any scientific or technical
information, design, process, procedure, formula, or improvement
that is commercially valuable and secret in the sense that its
confidentiality affords the Funds, PFPC or NCB a competitive
advantage over its competitors; (iv) all confidential or
proprietary concepts, documentation, reports, data, specifications,
computer software, source code, object code, flow charts,
databases, inventions, know-how, and trade secrets, whether or not
patentable or copyrightable; and (v) anything designated as
confidential. Notwithstanding the foregoing, information shall not
be subject to such confidentiality obligations if it: (i) is
already known to the receiving party at the time it is obtained;
(ii) is or becomes publicly known or available through no wrongful
act of the receiving party; (iii) is rightfully received from a
third party who, to the best of the receiving party's knowledge, is
not under a duty of confidentiality; (iv) is released by the
protected party to a third party without restriction; (v) is
required to be disclosed by the receiving party pursuant to a
requirement of a court order, subpoena, governmental or regulatory
agency or law (provided the receiving party will provide the other
party written notice of such requirement, to the extent such notice
is permitted); (vi) is relevant to the defense of any claim or
cause of action asserted against the receiving party; or (vii) has
been or is independently developed or obtained by the receiving
party.
-4-
(b) All Confidential Information shall be held in the strictest
confidence and will not be disclosed by either party or its
representatives, except as specifically permitted by the terms
hereof. Each party and its respective representatives will use the
Confidential Information solely for the purposes of performing
under and in compliance with the terms of this Agreement, will not
use the Confidential Information for any other purpose, and will
not disclose or communicate the Confidential Information, directly
or indirectly, to any third party except as necessary to carry out
the purpose of this Agreement. Each party further agrees that the
Confidential Information will be disclosed only to such of its
representatives who need to examine the Confidential Information
for the purposes described above. Before being provided with any
Confidential Information, each such representative shall be
informed of the confidential nature of the Confidential Information
and shall be directed to treat the Confidential Information
confidentially. Each party shall in any event be responsible for
any breach of this Agreement by any representative.
(c) Each party shall take all steps reasonably necessary to keep
confidential the Confidential Information and shall take all steps
reasonably necessary to assure observation of this Agreement by its
representatives. All Confidential Information shall remain the
exclusive property of the Originating Party or its affiliates, as
applicable. Upon request by the Originating Party, the Receiving
Party shall promptly surrender to the Originating Party any of the
Confidential Information in the Receiving Party's possession, and
shall surrender all Confidential Information to the Originating
Party promptly and without request upon the termination of this
Agreement. The Receiving Party will not retain any copies of the
Confidential Information.
(d) In the event that a Receiving Party or any of its representatives
is requested or required (by oral question, interrogatories,
requests for information or documents, subpoenas, civil
investigation or similar process) to disclose any of the
Confidential Information, such Receiving Party will provide the
Originating Party and its affiliates with prompt notice of such
requests so that the Originating Party or its affiliates, as
applicable, may seek an appropriate protective order, or if
appropriate, waive compliance with the provisions of this
Agreement. The Receiving Party will use its best efforts to obtain
or assist the Originating Party and its affiliates in obtaining
such a protective order.
-5-
(e) Each of the parties agree that any breach or threatened breach of
the provisions of this Section 8 shall cause immediate and
irreparable injury to the other party for which there exists no
adequate remedy at law. Accordingly, the parties hereby grant each
other the right to appear at any time in any court of law and to
obtain an order enjoining and/or restraining the Receiving Party
from using and/or disclosing such Confidential Information except
as such disclosure is permitted in this Agreement. The parties
shall be bound by all provisions of such protective order and/or
any determination of a court of competent jurisdiction.
(f) The provisions of this Section 8 shall survive termination of this
Agreement.
9. LIAISON WITH ACCOUNTANTS. A Co-Administrator shall act as liaison with
each Fund's independent public accountants and shall provide account
analyses, fiscal year summaries, and other audit-related schedules with
respect to each Portfolio. A Co-Administrator shall take all reasonable
action in the performance of its duties under this Agreement to assure
that the necessary information is made available to such accountants
for the expression of their opinion, as required by the Funds.
10. CO-ADMINISTRATORS' SYSTEMS. PFPC shall retain title to and ownership of
any and all data bases, computer programs, screen formats, report
formats, interactive design techniques, derivative works, inventions,
discoveries, patentable or copyrightable matters, concepts, expertise,
patents, copyrights, trade secrets, and other related legal rights
utilized by PFPC in connection with the services provided by PFPC to
the Funds. NCB shall retain title to and ownership of those data bases,
computer programs, screen formats, report formats, interactive design
techniques, derivative works, inventions, discoveries, patentable or
copyrightable matters, concepts, expertise, patents, copyrights, trade
secrets, and other related legal rights provided by NCB in connection
with the services provided by NCB to the Funds.
11. DISASTER RECOVERY. A Co-Administrator shall enter into and shall
maintain in effect with appropriate parties one or more agreements
making reasonable provisions for emergency use of electronic data
processing equipment to the extent appropriate equipment is available.
In the event of equipment failures, such Co-Administrator shall, at no
additional expense to the Funds, take reasonable steps to minimize
service interruptions. A Co-Administrator shall have no liability with
respect to the loss of data or service interruptions caused by
equipment failure, provided such loss or interruption is not caused by
such Co-Administrator's own willful misfeasance, bad faith, negligence
or reckless disregard of its duties or obligations under this
Agreement.
12. COMPENSATION. As compensation for services rendered by the
Co-Administrators during the term of this Agreement, each Fund, on
behalf of its respective Portfolio, will pay to the Co-Administrators a
fee or fees, and reimburse the Co-Administrators for out-of-pocket
expenses, as may be agreed to in writing by the Funds and the
respective Co-Administrators and attached as Exhibit B to this
Agreement.
-6-
13. INDEMNIFICATION. Each Fund, on behalf of its Portfolios, agrees to
indemnify, defend and hold harmless each Co-Administrator and its
affiliates, including their respective officers, directors, agents and
employees from all taxes, charges, expenses, assessments, claims and
liabilities (including, reasonable attorneys' fees and disbursements
and liabilities arising under the Securities Laws and any state and
foreign securities and blue sky laws) arising directly or indirectly
from any action or omission to act which a Co-Administrator takes in
connection with the provision of services to the Fund, provided that no
Fund shall be obligated to indemnify any such person against any
liability (or any expenses incident to such liability) caused by a
Co-Administrator's or its affiliates' own willful misfeasance, bad
faith, negligence or reckless disregard in the performance of its
activities under this Agreement. Any amounts payable by a Fund
hereunder shall be satisfied only against the relevant Portfolio's
assets and not against the assets of any other investment portfolio of
either Fund. The provisions of this Section 13 shall survive
termination of this Agreement.
14. RESPONSIBILITY OF THE CO-ADMINISTRATORS.
(a) A Co-Administrator shall be under no duty to take any action
hereunder on behalf of a Fund or any Portfolio except as
specifically set forth herein or as may be specifically agreed to
by the relevant Co-Administrator and the relevant Fund in a
written amendment hereto. A Co-Administrator shall be obligated to
exercise care and diligence in the performance of its duties
hereunder and to act in good faith in performing services provided
for under this Agreement and the service level standards set forth
in Exhibit D attached hereto. A Co-Administrator shall be liable
only for any damages arising out of its own failure to perform its
duties under this Agreement to the extent such damages arise out
of its own willful misfeasance, bad faith, negligence or reckless
disregard of such duties.
(b) Notwithstanding anything in this Agreement to the contrary, (i) a
Co-Administrator shall not be liable for losses, delays, failure,
errors, interruption or loss of data occurring directly or
indirectly by reason of circumstances beyond its reasonable
control (provided such Co-Administrator has acted in accordance
with the standard of care set forth above), including without
limitation acts of God; action or inaction of civil or military
authority; public enemy; war; terrorism; riot; fire; flood;
sabotage; epidemics; labor disputes; civil commotion;
interruption, loss or malfunction of utilities, transportation,
computer or communications capabilities; insurrection; elements of
nature; or non-performance by a third party; and (ii) a
Co-Administrator shall not be under any duty or obligation to
inquire into and shall not be liable for the validity or
invalidity, authority or lack thereof, or truthfulness or accuracy
or lack thereof, of any instruction, direction, notice, instrument
or other information which a Co-Administrator reasonably believes
to be genuine.
-7-
(c) Notwithstanding anything in this Agreement to the contrary,
neither Co-Administrator nor its affiliates shall be liable for
any consequential, special or indirect losses or damages, whether
or not the likelihood of such losses or damages was known by such
Co-Administrator or its affiliates.
(d) Any claims (including the filing of a suit or, if applicable,
commencement of arbitration proceedings) must be asserted by a
Fund against a Co-Administrator or any of its affiliates within 24
months after the Fund became aware of the claim or the Board of
Trustees of the Fund is informed of specific facts that should
have alerted it that a basis for such a claim might exist.
(e) Each party shall have a duty to mitigate damages for which the
other party may become responsible.
(f) The provisions of this Section 14 shall survive termination of
this Agreement.
(g) Notwithstanding anything in this Agreement to the contrary, a
Co-Administrator shall have no liability either for any error or
omission of the other Co-Administrator or any of their
predecessors as servicer on behalf of a Fund or for any failure to
discover any such error or omission.
15. DESCRIPTION OF ACCOUNTING SERVICES ON A CONTINUOUS BASIS.
The Co-Administrators will perform the following accounting services
with respect to each Portfolio:
(i) Journalize investment, capital share and income and expense
activities;
(ii) Verify investment buy/sell trade tickets when received from the
investment adviser for a Portfolio (the "Adviser");
(iii) Maintain individual ledgers for investment securities;
(iv) Maintain historical tax lots for each security;
(v) Reconcile cash and investment balances of the Fund with the
Fund's custodian, and provide the Adviser with the beginning
cash balance available for investment purposes;
(vi) Update the cash availability throughout the day as required by
the Adviser;
(vii) Post to and prepare the Statement of Assets and Liabilities and
the Statement of Operations;
(viii) Calculate various contractual expenses (E.G., advisory and
custody fees);
(ix) Monitor the expense accruals and notify Fund management of any
proposed adjustments;
(x) Control all disbursements, authorize such disbursements and act
as paying agent for such disbursements upon Written
Instructions;
(xi) Calculate capital gains and losses;
(xii) Determine net income;
(xiii) Obtain security market quotes from independent pricing services
approved by the Adviser, or if such quotes are unavailable, then
obtain such prices from the Adviser, and in either case
calculate the market value of each Portfolio's investments;
-8-
(xiv) Transmit to or make available a copy of the daily portfolio
valuation to the Adviser;
(xv) Compute net asset value;
(xvi) As appropriate, compute yields, total return, expense ratios,
portfolio turnover rate, and, if required, portfolio average
dollar-weighted maturity; and
(xvii) Convert and maintain historical components of equity required to
complete future net asset reports.
16. DESCRIPTION OF FINANCIAL ADMINISTRATION SERVICES ON A CONTINUOUS BASIS.
The Co-Administrators will perform the following financial
administration services with respect to each Portfolio:
(i) Supply various normal and customary Portfolio statistical data
as requested on an ongoing basis;
(ii) Monitor, to the extent information is available to such
Co-Administrator, the accuracy of statistical information
delivered to third-party statistical agencies by the
Co-Administrator;
(iii) Prepare for execution and file each Fund's Federal and state tax
returns;
(iv) Prepare and file with the SEC the Fund's annual and semi-annual
shareholder reports;
(v) Assist in the preparation of registration statements and other
filings relating to the registration of Shares;
(vi) Monitor each Portfolio's status as a regulated investment
company under Sub-chapter M of the Internal Revenue Code of
1986, as amended;
(vii) Monitor each Portfolio's compliance with the 1940 Act and with
disclosure included in its prospectuses and statements of
additional information;
(viii) Assist in the selection of and coordinate contractual
relationships and communications between the Fund and its
contractual service providers;
(ix) Monitor the Fund's compliance with the amounts and conditions of
each state qualification;
(x) Perform accounting services required for the Trustees Deferred
Compensation Plan;
(xi) With respect to PFPC only, provide employees or officers to
serve as Treasurer of the Funds and to serve as such other
officers as the Fund may request, subject to the agreement of
PFPC;
(xii) Prepare monthly expense budgets in accordance with Fund
management specifications; and
(xiii) Monitor indices and halted securities and communicate those
issues that trigger the potential for security fair valuation in
accordance with fair value pricing procedures established by
each Fund's Board of Trustees.
-9-
17. DESCRIPTION OF REGULATORY ADMINISTRATION SERVICES ON A CONTINUOUS
BASIS.
The Co-Administrators will perform the following regulatory
administration services with respect to each Portfolio:
(i) Prepare Post-Effective Amendments to each Fund's Registration
Statement, subject to review by and approval of the Funds'
counsel, and coordinate with the Fund's financial printer to
make such filings with the SEC;
(ii) Assist in obtaining the fidelity bond and directors' and
officers'/errors and omissions insurance policies for the Funds
in accordance with the requirements of Rules 17g-1 and 17d-1 (d)
(7) under the 1940 Act as such bond and policies are approved by
each Fund's Board of Trustees;
(iii) File each Fund's fidelity bond with the SEC and monitor each
Fund's assets to assure adequate fidelity bond coverage is
maintained;
(iv) Draft agendas, resolutions and materials for quarterly and
special Board meetings subject to review and approval by the
Funds' counsel;
(v) Coordinate the preparation, assembly and mailing of Board
materials;
(vi) Attend Board meetings (and make presentations at such meetings
as appropriate) and draft minutes of such meetings (but only if
requested by NCB to do so and subject to review and approval by
the Funds' counsel);
(vii) Maintain each Fund's corporate calendar to assure compliance
with various SEC filing and Board approval deadlines;
(viii) Maintain the Funds' files; and
(ix) Assist in monitoring regulatory developments which may affect
the Funds and assist the Funds in the handling of SEC
examinations.
18. DESCRIPTION OF DISTRIBUTION SUPPORT SERVICES.
PFPC will perform the following distribution support services:
(i) Provide marketing support services, including developing regular
marketing materials; assisting with direct marketing, data
warehouse, vendor review and recommendations, media planning,
development and recommendations, PR coordination and event
coordination and development; providing print production
coordination; and assisting in the development of sales
development materials by segment;
(ii) Provide product support services, including evaluating specific
product features offered within retirement, WRAP, annuity and
cash management products; presenting suggestions for
enhancements and potential new product development and rollout;
and evaluating the Fund's share class structure;
(iii) Provide industry research services, including providing
regulatory alerts and updates as necessary; providing white
papers and industry research; negotiating reduced rate
subscriptions to industry publications; providing access to
third-party industry research and white papers; and responding
to ad hoc requests for industry research;
(iv) Providing dealer and shareholder services, including email
response support; and
(v) Providing inbound teleservicing support.
-10-
19. DURATION AND TERMINATION.
(a) This Agreement shall be effective on the date first above
written and shall continue in effect for an initial period of
three (3) years (the "Initial Term"). Thereafter, this Agreement
shall continue automatically for successive terms of one (1)
year (each, a "Renewal Term"); provided however, that this
Agreement may be terminated at the end of the Initial Term or
any subsequent date by the Funds or by a Co-Administrator on
ninety (90) days' prior written notice to the other parties. In
the event a Fund gives notice of termination, all reasonable
expenses associated with movement (or duplication) of records
and materials and conversion thereof to a successor accounting
and administration services agent(s) (and any other service
provider(s)), and all reasonable and directly related trailing
expenses incurred by the Co-Administrators, will be borne by the
Fund. In the event this Agreement is terminated by one, but not
both Funds, this Agreement shall remain in full force and effect
with respect to the non-terminating Fund.
(b) If a party hereto fails in any material respect to perform its
duties and obligations hereunder (a "Defaulting Party"), the
other party (the "Non-Defaulting Party") may give written notice
thereof to the Defaulting Party, and if such material breach
shall not have been remedied within thirty (30) days after such
written notice is given, then the Non-Defaulting Party may
terminate this Agreement by giving thirty (30) days written
notice of such termination to the Defaulting Party. Termination
of this Agreement by the Non-Defaulting Party shall not
constitute a waiver of any other rights or remedies with respect
to obligations of the parties prior to such termination or
rights of PFPC to be reimbursed for out-of-pocket expenses. In
all cases, termination by the Non-Defaulting Party shall not
constitute a waiver by the Non-Defaulting Party of any other
rights it might have under this Agreement or otherwise against
the Defaulting Party.
(c) The Funds may terminate this Agreement prior to the end of the
Initial Term or any Renewal Term if PFPC fails to meet the
service standards in any one category as set forth in Exhibit D
to this Agreement for (i) a period of four (4) consecutive
months or (ii) any six (6) months in a twelve (12) month period.
20. NOTICES. Notices shall be addressed (a) if to PFPC, at 000 Xxxxxxxx
Xxxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000, Attention: President; (b) if to a
Fund or NCB, at National City Bank, 0000 Xxxx Xxxxx Xxxxxx, Xxxxxxxxx
Xxxx 00000, with a copy to W. Xxxxx XxXxxxxx, III, Esquire, Drinker
Xxxxxx & Xxxxx, LLP, One Xxxxx Square, 18th & Cherry Streets,
Philadelphia, Pennsylvania 19103 or (c) if to neither of the foregoing,
at such other address as shall have been given by like notice to the
sender of any such notice or other communication by the other party. If
notice is sent by confirming telegram, cable, telex or facsimile
sending device, it shall be deemed to have been given immediately. If
notice is sent by first-class mail, it shall be deemed to have been
given three days after it has been mailed. If notice is sent by
messenger, it shall be deemed to have been given on the day it is
delivered.
-11-
21. AMENDMENTS. This Agreement, or any term thereof, may be changed or
waived only by written amendment, signed by the party against whom
enforcement of such change or waiver is sought.
22. ASSIGNMENT. PFPC may assign its rights hereunder to any majority-owned
direct or indirect subsidiary of PFPC or of The PNC Financial Services
Group, Inc., provided that (i) PFPC gives NCB and the Funds 30 days'
prior written notice of such assignment, (ii) the assignee or delegate
agrees to comply with the relevant provisions of the 1940 Act, and
(iii) PFPC and such assignee or delegate promptly provides such
information as a Fund may reasonably request and respond to such
questions as the Fund may reasonably ask, relative to the assignment or
delegation (including, without limitation, the capabilities of the
assignee or delegate).
23. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
24. FURTHER ACTIONS. Each party agrees to perform such further acts and
execute such further documents as are necessary to effectuate the
purposes hereof.
25. MISCELLANEOUS.
(a) Notwithstanding anything in this Agreement to the contrary, each
Fund agrees not to make any modifications to its registration
statement or adopt any policies which would affect materially
the obligations or responsibilities of a Co-Administrator
hereunder without the prior written approval of a
Co-Administrator, which approval shall not be unreasonably
withheld or delayed.
(b) Except as expressly provided in this Agreement, a
Co-Administrator hereby disclaims all representations and
warranties, express or implied, made to the Funds or any other
person, including, without limitation, any warranties regarding
quality, suitability, merchantability, fitness for a particular
purpose or otherwise (irrespective of any course of dealing,
custom or usage of trade), of any services or any goods provided
incidental to services provided under this Agreement. A
Co-Administrator disclaims any warranty of title or
non-infringement except as otherwise set forth in this
Agreement.
(c) This Agreement embodies the entire agreement and understanding
between the parties and supersedes all prior agreements and
understandings relating to the subject matter hereof, provided
that the parties may embody in one or more separate documents
their agreement, if any, with respect to delegated duties. The
captions in this Agreement are included for convenience of
reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or
effect. Notwithstanding any provision hereof, the services of a
Co-Administrator are not, nor shall they be, construed as
constituting legal advice or the provision of legal services for
or on behalf of the Funds or any other person.
-12-
(d) This Agreement shall be deemed to be a contract made in Delaware
and governed by Delaware law, without regard to principles of
conflicts of law.
(e) If any provision of this Agreement shall be held or made invalid
by a court decision, statute, rule or otherwise, the remainder
of this Agreement shall not be affected thereby. This Agreement
shall be binding upon and shall inure to the benefit of the
parties hereto and their respective successors and permitted
assigns.
(g) The facsimile signature of any party to this Agreement shall
constitute the valid and binding execution hereof by such party.
26. XXXXXXXX-XXXXX CERTIFICATIONS. PFPC acknowledges that it may from time
to time provide certain information that is necessary to complete a
report or other filing that is required to be certified by certain of
the Funds' officers pursuant to Section 302 and 906 of the
Xxxxxxxx-Xxxxx Act of 2002 (the "Act") and rules and regulations
promulgated from time to time thereunder (each such report or other
filing, a "Certified Report"). PFPC agrees that any information PFPC
provides that is necessary to complete a Certified Report, to its best
knowledge, will be true and complete when given. PFPC further agrees
that any written representation or certification it provides to the
Funds and/or the officers of the Funds in support of a certification by
them to the SEC pursuant to the Act and/or any rules and regulations
issued from time to time thereunder, to its best knowledge, will be
true and correct and complete when given. This covenant shall survive
termination of this Agreement.
27. BUSINESS TRUST. The name Armada Funds and Armada Advantage Fund and of
any investment portfolio thereof, and any reference to the "Trustees"
of Armada Funds or Armada Advantage Fund, refer respectively to the
Trusts created and the Trustees, as trustees but not individually or
personally, acting from time to time under the respective Declarations
of Trust which are hereby referred to and copies of which are on file
at the office of the State Secretary of the Commonwealth of
Massachusetts and at the principal office of each Trust. The
obligations of Armada Funds and Armada Advantage Fund entered into in
their names, or on behalf of any of their investment portfolios, or on
behalf thereof by any of their Trustees, representatives or agents, are
made not individually, but in such capacities, and are not binding upon
any of the Trustees, shareholders or representatives of a Trust
personally, but bind only the Trust property, and all persons dealing
with any class of shares of a Trust must look solely to the Trust
property belonging to such class for the enforcement of any claims
against such Trust.
-13-
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and year first above written.
PFPC INC.
By: /S/ XXXX X. XXXXXXX
Xxxx X. Xxxxxxx
Senior Vice President
National City Bank
By: /S/ XXXXXXXX X. XXXX
Name: Xxxxxxxx X. Xxxx
Title: Senior Vice President
Armada Funds
By: /S/ XXXXXXX X. XXXXXXX
Name: Xxxxxxx X. Xxxxxxx
Title: President and Trustee
Armada Advantage Fund
By: /S/ XXXXXXX X. XXXXXXX
Name: Xxxxxxx X. Xxxxxxx
Title: President and Trustee
PFPC INTERNAL USE:
Business Approval/Date: 6/15/03
Legal Approval/Date: (attached)
-14-
EXHIBIT A
THIS EXHIBIT A, dated as of June 1, 2003 is Exhibit A to that certain
Co-Administration and Accounting Services Agreement dated as of June 1, 2003
among PFPC Inc., National City Bank, and each of Armada Funds, and Armada
Advantage Fund.
ARMADA FUNDS
PORTFOLIOS
Money Market Fund
Government Money Market Fund
Treasury Money Market Fund
Treasury Plus Money Market Fund
Tax Exempt Money Market Fund
Ohio Municipal Money Market Fund
Pennsylvania Tax Exempt Money Market Fund
Intermediate Bond Fund
Equity Growth Fund
Ohio Tax Exempt Bond Fund
Limited Maturity Bond Fund
Total Return Advantage Fund
Small Cap Value Fund
Large Cap Value Fund
Pennsylvania Municipal Bond Fund
Bond Fund
GNMA Fund
International Equity Fund
Small Cap Growth Fund
Core Equity Fund
Equity Index Fund
Balanced Allocation Fund
National Tax Exempt Bond Fund
Tax Managed Equity Fund
Mid Cap Growth Fund
Large Cap Ultra Fund
U.S. Government Income Fund
Michigan Municipal Bond Fund
Aggressive Allocation Fund
Conservative Allocation Fund
Small/Mid Cap Value Fund
-15-
UA Emerging Markets Fund
UA International Equity Fund
UA Large Cap Ultra Fund
UA Large Cap Value Fund
UA Real Estate Fund
UA Small Cap Growth Fund
UA Small / Mid Cap Value Fund
UA High Yield Bond Fund
UA Short Duration Bond Fund
UA U.S. Government Income Fund
UA Money Market Fund
Short Duration Bond Fund
High Yield Bond Fund
Strategic Income Bond Fund
ARMADA ADVANTAGE FUND
PORTFOLIOS
Armada Advantage Bond Fund
Armada Advantage Mid Cap Growth Fund
Armada Advantage Small Cap Growth Fund
Armada Advantage International Equity Fund
Armada Advantage Equity Growth Fund
Armada Advantage Balanced Allocation Fund
-16-
EXHIBIT B
FEE SCHEDULE
Pursuant to Paragraph 12 of this Agreement, and in consideration of the
services to be provided to each Portfolio, each Fund will pay PFPC and NCB
annual fees to be calculated daily and paid monthly as set forth below:
CO-ADMINISTRATION FEE:
.07% annual fee will be calculated based upon the aggregate net assets
of each Fund, payable monthly.
OUT-OF-POCKET EXPENSES:
The Funds will reimburse PFPC and NCB for out-of-pocket expenses
incurred on a Fund's behalf, including, but not limited to, postage,
telephone, telex, overnight express charges, deconversion costs, custom
development costs, transmission expenses, travel expenses incurred for
Board meeting attendance or other travel at the request of the
Portfolios. In addition, out-of-pocket costs will include the costs to
obtain independent security market quotes.
MISCELLANEOUS:
The fee for the period from the date hereof until the end of that year
shall be prorated according to the proportion that such period bears to
the full annual period.
-17-
EXHIBIT C
PFPC DATAPATH ACCESS SERVICES
1. PFPC SERVICES
PFPC shall:
(a) Provide internet access to PFPC's DataPath ("DataPath") at
XXX.XXXXXXXXXXXX.XXX or other site operated by PFPC (the "Site")
for Fund portfolio data otherwise supplied by PFPC to Fund
service providers via other electronic and manual methods. Types
of information to be provided on the Site include: (i) data
relating to portfolio securities, (ii) general ledger balances
and (iii) net asset value-related data, including NAV and net
asset, distribution and yield detail (collectively, the
"Accounting Services");
(b) Supply each of the Authorized Persons ("Users") with a logon ID
and Password;
(c) Provide to Users access to the information listed in subsection
(a) above using standard inquiry tools and reports. With respect
to the Accounting Services, Authorized Users will be able to
modify standard inquiries to develop user-defined inquiry tools;
however, PFPC will review computer costs for running
user-defined inquiries and may assess surcharges for those
requiring excessive hardware resources. In addition, costs for
developing significant custom reports or enhancements are not
included in the fees set forth in Section 12 of the Agreement
and will be billed separately;
(d) Utilize a form of encryption that is generally available to the
public in the U.S. for standard internet browsers and establish,
monitor and verify firewalls and other security features
(commercially reasonable for this type of information and these
types of users) and exercise commercially reasonable efforts to
attempt to maintain the security and integrity of the Site; and
(e) Monitor the telephone lines involved in providing the Accounting
Services and inform the Funds promptly of any malfunctions or
service interruptions.
1. DUTIES OF THE FUNDS, NCB AND THE USERS
The Funds, NCB and/or the Users, as appropriate, shall:
(a) Provide and maintain a web browser supporting Secure Sockets
Layer 128-bit encryption; and
-18-
(b) Keep logon IDs and passwords confidential and notify PFPC
immediately in the event that a logon ID or password is lost,
stolen or if you have reason to believe that the logon ID and
password are being used by an unauthorized person.
3. STANDARD OF CARE; LIMITATIONS OF LIABILITY
(a) Each Fund and NCB acknowledges that the Internet is an "open,"
publicly accessible network and not under the control of any
party. PFPC's provision of Accounting Services is dependent upon
the proper functioning of the Internet and services provided by
telecommunications carriers, firewall providers, encryption
system developers and others. Each Fund and NCB agrees that PFPC
shall not be liable in any respect for the actions or omissions
of any third party wrongdoers (i.e., hackers not employed by
such party or its affiliates) or of any third parties involved
in the Accounting Services and shall not be liable in any
respect for the selection of any such third party, unless that
selection constitutes a breach of PFPC's standard of care set
forth in Section 14 of the Agreement.
(b) Without limiting the generality of the foregoing or limiting the
applicability of any other provision of this Exhibit B or the
Agreement, including Sections 11, 14(a) and 14(b), PFPC shall
not be liable for delays or failures to perform any of the
Accounting Services or errors or loss of data occurring by
reason of circumstances beyond such party's control, which may
include: functions or malfunctions of the internet or
telecommunications services, firewalls, encryption systems or
security devices.
-19-
EXHIBIT D
ARMADA FUNDS
SERVICE STANDARDS
(Standards shall be measured on a monthly basis)
FUND ACCOUNTING AND ADMINISTRATION SERVICES
CATEGORY - FUND ACCOUNTING
1. Number of Accurate NAV's Reported to the Funds' transfer agent (the
"Transfer Agent") divided by the Total Number of NAV's Required to Report
to the Transfer Agent (excluding Money Market Funds): 98%
o "NAV" for this purpose is class net assets divided by total class
shares outstanding. An NAV is not accurate if, upon recalculation, the
change in the reported extended class NAV is greater than a full
xxxxx.
o Each NAV error for a given day is treated as a single NAV error.
2. Number of accurate NAV's Reported to NASDAQ divided by Number of Total
NAV's Required to be Reported to NASDAQ (excluding Money Market Funds): 98%
o NAV for this purpose is class net assets divided by total class shares
outstanding. An NAV is not accurate if, upon recalculation, the NAV
difference is greater than a full xxxxx.
o Each NAV error for a given day is treated as a single NAV error.
3. Accurate and Timely Cash Availability Reports ("CAR") to the Adviser
Divided by Number of Portfolios Requiring Cash Availability Reporting: 99%
o Timely CAR means, notwithstanding any other clause to the contrary,
delivery by 10:45 a.m. (Eastern Time) for all Portfolios with the
except of the following Portfolios, which require delivery by 10:15
a.m. (Eastern Time):
Equity Index Fund
International Equity Fund
Ohio Tax Exempt Bond Fund
Pennsylvania Municipal Bond Fund
Michigan Municipal Bond Fund
National Tax Exempt Bond Fund
-20-
o Accurate CAR means errors controllable by a Co-Administrator that
resulted in an overdraft to the Portfolios.
4. Number of accurate data elements (NAVs, yields and performance) delivered
to the website divided by the total number of individual data elements
delivered: 98%
o Since these extracts are system generated, a properly approved NAV
would be deemed to be accurately delivered if it were subsequently
realized to be calculated in error. This error would effect the
calculation in #1 above.
5. Notify the Adviser of compliance violations identified through the normal
quantitative secondary compliance tests performed for each Portfolio no
later than the second business day following the receipt of accurate and
complete trade information by PFPC: 100%
6. Final annual and semiannual shareholder reports shall contain no material
errors: 100%
o For purposes of this performance standard, a "material error" shall be
one that requires a reprint of the report.
Note: For purposes of the foregoing calculations, the Portfolios of both Funds
will be aggregated.
DISTRIBUTION SUPPORT SERVICES
The Funds' rights with respect to the following Distribution Support Services
standards shall become effective on September 1, 2003.
CATEGORY - TELESERVICING:
o 85% Monthly Service Level
o PFPC will maintain an abandon call rate of 2% or less on inbound calls,
counting only days on which the Funds operate under normal market conditions
(100%). Normal conditions defined as an average of 75 calls a day, Monday -
Friday 8:00 a.m. to 8:00 p.m. (This does not include circumstances such as
above-average call volumes due to market dynamics, extreme market swings or
the results of unexpected PR). PFPC will be given advanced notice (5 days or
more) of any fund communications or marketing campaigns to accommodate
potential increases in call volumes.
o PFPC will answer telephone calls (measured by calendar month) with an average
speed to answer of 20 seconds or less, counting only days on which the Funds
operate under normal market conditions. (100%)
-21-
o Email Response Rate of 100% within same business day. Contingent upon
receiving all information and research needed to respond. Armada to be
provided with copies of PFPC responses on a monthly basis.
o Monitor and provide summary of 5 calls per month per primary rep.
o Monthly Call Log: # and nature of complaints to be provided to Armada on a
Monthly basis.
o Monthly CCQ (Call Center Quality) Scorecard
CATEGORY - MARKETING/COMMUNICATIONS
Monthly Cycle
o PFPC will release the web and print versions of the monthly performance
summary updates by the 5th business day after the month-end (this does not
include time to print/distribute and depends upon correct receipt of data
feeds between Fund Accounting and SySys).
o PFPC will release the web updates of the fund snapshots by the 7th business
day after the month-end. Based on the release of schedule of the indices.
Contingent on timely receipt of data.
o PFPC will release the fund family web updates, the web Morningstar updates
and the print version of the Morningstar flyers by the 5th business day
following receipt of final data from Morningstar. Turnaround contingent on
timely receipt of Morningstar data.
Quarterly Cycle
o PFPC will release the web and print versions of fund snapshots by the 7th
business day after the quarter-end (this does not include time to
print/distribute). Based on the release schedule of indices. Contingent on
timely receipt of data.
o PFPC will release the full product guides to print (fund snapshots, S&P
flyers, and overview text) by the 15th business day after the quarter-end, or
within 5 business days of receipt of complete overview text and S&P data
(this does not include time to print/distribute). Based on the release
schedule of indices and other data elements. Contingent on timely receipt of
data.
Monthly Inventory Report
o Deliver a monthly "intelligent" inventory status report for fulfillment
items, marketing collateral and premium items including usage, date of piece,
and related kits. PFPC will provide recommendations whether to revise,
reprint or eliminate from inventory as part of this report. Contingent on RR
Xxxxxxxx and Imagraphics data delivery to PFPC.
-22-
New Marketing Projects
o PFPC will prepare a brief on all new marketing initiatives outlining the
scope of the project, responsibilities, timeframes and cost. This will be
delivered to Armada within 10-15 days of receipt of pertinent information
from the business owner.
CATEGORY - NASD MARKETING REVIEW:
o Provide status update on Broker Dealer Agreements to Armada on a weekly basis
based upon information received from the Funds' underwriter.
o To cause the review and submission of documents to the NASD by the Funds'
underwriter. Once marketing materials are in final format they will be
submitted to the NASD within 10 days of first use. (100%)
o A marketing budget report will be provided to the Funds by the 25th calendar
day after the end of each month. (100%)
o ADVERTISING STANDARDS: Response times assume no more than 75 pages are under
review on any one day, and assumes complete submissions with all necessary
backup to render the review. If more than 75 pages under review on any day,
PFPC will contact the Funds to set priorities. No material will remain
outstanding for more than 7 business days. Standards will be met 95% of the
time.
Under 10 pages 2 business days
10-25 pages 3 business days
25+ pages 5 business days
o 12B-1 / MARKETING BILLS:
~ Communicate with the Funds' underwriter to ensure that checks will be cut at
last once a week
~ 12b-1 Spreadsheet reporting status to be provided weekly
~ Monthly budget on 12b-1 and non-12b-1 expenses
o NASD Training: To be provided annually on site at NCB.
CATEGORY - STRATEGIC RESEARCH AND PLANNING
o Research Standards: All Fund research requests will be made in writing by the
project owner to the head of research. A follow-up call will be made by PFPC
to the project owner to define parameters of the project in detail. A project
assessment of resources and scope will be made to the client within 5
business days following the initial discussion. Each item will be documented
on the PIC report and prioritized by the Funds. Actual completion dates will
be based on priorities in queue.
-23-
