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EXHIBIT 9.1
FORM OF SUB-ADMINISTRATION AND ACCOUNTING SERVICES AGREEMENT
THIS AGREEMENT is made as of September 15, 1997 by and among BANK OF
AMERICA NT & SA ("Bank of America"), PFPC INC., a Delaware corporation ("PFPC"),
which is an indirect wholly owned subsidiary of PNC Bank Corp. and TIME HORIZON
FUNDS, a Delaware business trust (the "Fund").
W I T N E S S E T H :
WHEREAS, Bank of America has entered into a Management Agreement dated
September 5, 1995, with the Fund (the "Management Agreement"), concerning the
provision of administrative services to the 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 collectively, the "Portfolios");
WHEREAS, the Fund is registered as an open-end management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act");
and
WHEREAS, Bank of America wishes to retain PFPC to provide sub-
administration services and the Fund wishes to retain PFPC to provide accounting
services to the Portfolios and PFPC wishes to furnish such services.
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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 the 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 and listed on
the Authorized Persons Appendix attached hereto and made a part hereof or any
amendment thereto as may be received by PFPC. An Authorized Person's scope of
authority may be limited by the Fund by setting forth such limitation in the
Authorized Persons Appendix.
(d) "CEA" means the Commodities Exchange Act, as amended.
(e) "Oral Instructions" mean oral instructions received
by PFPC from an Authorized Person or from a person reasonably believed by PFPC
to be an Authorized Person.
(f) "SEC" means the Securities and Exchange Commission.
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(g) "Securities Laws" means the 1933 Act, the 1934 Act,
the 1940 Act and the CEA.
(h) "Shares" mean the shares of beneficial interest of
any series or class of the Fund.
(i) "Written Instructions" mean written instructions
signed by an Authorized Person and received by PFPC. The instructions may be
delivered by hand, mail, tested telegram, cable, telex or facsimile sending
device.
2. Appointment. Bank of America hereby appoints PFPC to
provide sub-administration services and the Fund hereby appoints PFPC to provide
accounting services to the each of the Portfolios, in accordance with the terms
set forth in this Agreement. PFPC accepts such appointment and agrees to furnish
such services.
3. Delivery of Documents. The Fund or Bank of America has
provided or, where applicable, will provide PFPC with the following:
(a) certified or authenticated copies of the resolutions
of the Fund's Board of Trustees, approving the
appointment of PFPC or its affiliates to provide
services to each Portfolio and approving this
Agreement;
(b) a copy of the Fund's most recent effective regis-
tration statement;
(c) a copy of each Portfolio's advisory, sub-advisory
or management agreement or agreements;
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(d) a copy of the distribution agreement with respect
to each class of Shares representing an interest in
a Portfolio;
(e) a copy of any additional administration agreement
with respect to a Portfolio;
(f) a copy of any shareholder servicing or transfer
agency agreement made in respect of the Fund or a
Portfolio; and
(g) copies (certified or authenticated, where applica-
ble) of any and all amendments or supplements to the
foregoing.
4. Compliance with Rules and Regulations.
PFPC 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 the duties to be performed by
PFPC hereunder. Except as specifically set forth herein, PFPC assumes no
responsibility for such compliance by Bank of America, the Fund or any
Portfolio.
5. Instructions.
(a) Unless otherwise provided in this Agreement, PFPC
shall act only upon Oral Instructions and Written Instructions.
(b) PFPC shall be entitled to rely upon any Oral
Instructions and Written Instructions it receives from an Authorized Person (or
from a person reasonably believed by PFPC to be an Authorized Person) pursuant
to this Agreement. PFPC may assume
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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 PFPC receives Written
Instructions to the contrary.
(c) Bank of America shall cause the Fund to forward to
PFPC Written Instructions confirming Oral Instructions (except where such Oral
Instructions are given by PFPC) so that PFPC 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
PFPC shall in no way invalidate the transactions or enforceability of the
transactions authorized by the Oral Instructions. Where Oral Instructions or
Written Instructions reasonably appear to have been received from an Authorized
Person, PFPC shall incur no liability to Bank of America or the Fund in acting
upon such Oral Instructions or Written Instructions provided that PFPC's actions
comply with the other provisions of this Agreement.
6. Right to Receive Advice.
(a) Advice of Bank of America or the Fund. If PFPC is
in doubt as to any action it should or should not take, PFPC may
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request directions or advice, including Oral Instructions or Written
Instructions, from Bank of America or the Fund.
(b) Advice of Counsel. If PFPC shall be in doubt as to
any question of law pertaining to any action it should or should not take, PFPC
may request advice at its own cost from such counsel of its own choosing (who
may be counsel for Bank of America, the Fund or PFPC, at the option of PFPC).
(c) Conflicting Advice. In the event of a conflict
between directions, advice or Oral Instructions or Written Instructions PFPC
receives from Bank of America or the Fund and the advice PFPC receives from
counsel, PFPC may rely upon and follow the advice of counsel. In the event PFPC
so relies on the advice of counsel, PFPC shall remain liable for any action or
omission on the part of PFPC which constitutes willful misfeasance, bad faith,
negligence or reckless disregard by PFPC of any duties, obligations or
responsibilities set forth in this Agreement.
(d) Protection of PFPC. PFPC shall be protected in any
action it takes or does not take in reliance upon directions, advice or Oral
Instructions or Written Instructions it receives from Bank of America or the
Fund or from counsel and which PFPC believes, in good faith, to be consistent
with those directions, advice or Oral Instructions or Written Instructions.
Nothing in
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this section shall be construed so as to impose an obligation upon PFPC (i) to
seek such directions, advice or Oral Instructions or Written Instructions, or
(ii) to act in accordance with such directions, advice or Oral Instructions or
Written Instructions unless, under the terms of another provision of this
Agreement, the same is a condition of PFPC's properly taking or not taking such
action. Nothing in this subsection shall excuse PFPC when an action or omission
on the part of PFPC constitutes willful misfeasance, bad faith, negligence or
reckless disregard by PFPC of any duties, obligations or responsibilities set
forth in this Agreement.
7. Records; Visits.
(a) The books and records pertaining to the Fund and the
Portfolios which are in the possession or under the control of PFPC shall be the
property of the Fund. Such books and records shall be prepared and maintained as
required by the 1940 Act and other applicable securities laws, rules and
regulations. The Fund and Authorized Persons shall have access to such books and
records at all times during PFPC's normal business hours. Upon the reasonable
request of Bank of America or the Fund, copies of any such books and records
shall be provided by PFPC to Bank of America or the Fund or to an Authorized
Person, at the Fund's expense.
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(b) PFPC shall keep the following records:
(i) all books and records with respect to each
Portfolio's books of account;
(ii) records of each Portfolio's securities trans
actions;
(iii) all other books and records as PFPC is required to
maintain pursuant to Rule 31a-1 of the 1940 Act in
connection with the services provided hereunder.
8. Confidentiality. PFPC agrees to keep confidential all
records of the Fund and information relating to the Fund and its shareholders,
unless the release of such records or information is otherwise consented to, in
writing, by Bank of America. Bank of America agrees that such consent shall not
be unreasonably withheld and may not be withheld where PFPC may be exposed to
civil or criminal contempt proceedings, and Bank of America and the Fund agree
that no notice or consent will be required when PFPC is required to divulge such
information or records to duly constituted authorities.
9. Liaison with Accountants. PFPC shall act as liaison with
the Fund's independent public accountants and shall provide account analyses,
fiscal year summaries, and other audit-related schedules with respect to each
Portfolio. PFPC shall take all reasonable action in the performance of its
duties under this Agreement to
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assure that the necessary information is made available to such accountants for
the expression of their opinion, as required by the Fund.
10. Disaster Recovery. PFPC 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, PFPC shall, at no additional expense to Bank of America or the Fund,
take reasonable steps to minimize service interruptions but shall have no
liability with respect thereto.
11. Compensation. As compensation for services rendered by
PFPC during the term of this Agreement, Bank of America will pay to PFPC a fee
or fees with respect to the sub-administration services provided herein as
described in paragraph 15 below as may be agreed to in writing by Bank of
America and PFPC. As compensation for accounting services described in paragraph
14 below rendered by PFPC during the term of this Agreement, the Fund will pay
to PFPC a fee or fees with respect to the accounting services provided herein as
may be agreed to in writing by the Fund and PFPC.
12. Indemnification. Bank of America (for itself and on
behalf of the Fund) agrees to indemnify and hold harmless PFPC and
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its affiliates from all taxes, charges, expenses, assessments, claims and
liabilities (including, without limitation, liabilities arising under the
Securities Laws and any state or foreign securities and blue sky laws, and
amendments thereto), and expenses, including (without limitation) attorneys'
fees and disbursements, arising directly or indirectly from any action or
omission to act which PFPC takes (i) at the request or on the direction of or in
reliance on the advice of Bank of America or the Fund or (ii) upon Oral
Instructions or Written Instructions. PFPC shall not, however, be indemnified
against any liability (or any expenses incident to such liability) arising out
of PFPC's own willful misfeasance, bad faith, negligence or reckless disregard
of its duties and obligations under this Agreement.
13. Responsibility of PFPC.
(a) PFPC shall be under no duty to take any action on
behalf of Bank of America, the Fund or any Portfolio except as specifically set
forth herein or as may be specifically agreed to by PFPC in writing. PFPC shall
be obligated to exercise care and diligence in the performance of its duties
hereunder and shall be liable for any damages arising out of PFPC's failure to
perform its duties under this Agreement to the extent such damages arise out of
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PFPC's willful misfeasance, bad faith, negligence or reckless disregard of such
duties.
(b) Without limiting the generality of the foregoing or
of any other provision of this Agreement, (i) PFPC shall not be liable for
losses beyond its control, provided that PFPC has acted in accordance with the
standard of care set forth above; and (ii) PFPC shall not be liable for (A) the
validity or invalidity or authority or lack thereof of any Oral Instruction or
Written Instruction, notice or other instrument which conforms to the applicable
requirements of this Agreement, and which PFPC reason ably believes to be
genuine; or (B) subject to Section 10, delays or errors or loss of data
occurring by reason of circumstances beyond PFPC's control, including acts of
civil or military authority, national emergencies, labor difficulties, fire,
flood, catastrophe, acts of God, insurrection, war, riots or failure of the
mails, transportation, communication or power supply.
(c) Notwithstanding anything in this Agreement to the
contrary, PFPC shall not be liable for any consequential, special or indirect
losses or damages which Bank of America, the Fund or any Portfolio may incur or
suffer by or as a consequence of PFPC's performance of the services provided
hereunder, whether or not the likelihood of such losses or damages was known by
PFPC.
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14. Description of Accounting Services on a Continuous Basis.
PFPC 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") and transmit trades
to the Fund's custodian (the "Custodian") for
proper settlement;
(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 Custodian, and provide the
Adviser with the beginning cash balance avail
able 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
an officer of the Fund of any proposed
adjustments;
(x) Control all disbursements and authorize such
disbursements upon Written Instructions;
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(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;
(xiv) Transmit or mail a copy of the daily
portfolio valuation to the Adviser;
(xv) Compute net asset value for each Portfolio and
transmit to the Portfolio's transfer agent;
(xvi) As appropriate, compute yields, total
return, expense ratios, portfolio turnover
rate, and, if required, portfolio average
dollar-weighted maturity; and
(xvii) Prepare a monthly financial statement,
which will include the following items:
Schedule of Investments
Statement of Assets and Liabilities
Statement of Operations
Statement of Changes in Net Assets
Cash Statement
Schedule of Capital Gains and Losses.
15. Description of Sub-Administration Services on a
Continuous Basis.
PFPC will perform the following sub-administration
services with respect to each Portfolio:
(i) Prepare quarterly broker security transactions
summaries;
(ii) Prepare monthly security transaction listings;
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(iii) Supply various normal and customary Portfolio
and Fund statistical data as requested on an
ongoing basis;
(iv) Prepare for execution and file the Fund's
Federal and state tax returns;
(v) Prepare and file the Fund's Semi-Annual Reports
with the SEC on Form N-SAR;
(vi) Prepare and file with the SEC the Fund's annual and
semi-annual shareholder reports;
(vii) Assist in the preparation of registration
statements and other filings relating to the
registration of Shares;
(viii) Monitor each Portfolio's status as a regulated
investment company under Sub-chapter M of the
Internal Revenue Code of 1986, as amended;
(ix) Coordinate contractual relationships and
communications between the Fund and its contractual
service providers;
(x) Monitor the Fund's compliance with the amounts
and conditions of each state qualification;
(xi) Assist in the monitoring of compliance with
1940 Act provisions and the rules thereunder
and the investment policies and limitations as
stated in the Fund's registration statement;
(xii) Perform such administrative services
(including without limitation, the furnishing
of reports to the Board) as the Fund or an
Authorized Person shall from time to time
reasonably request.
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16. Duration and Termination. This Agreement shall continue
until terminated without penalty by a party on sixty (60) days' prior written
notice to the other parties.
17. Notices. All notices and other communications, including
Written Instructions, shall be in writing or by confirming telegram, cable,
telex or facsimile sending device. 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. Notices shall
be addressed (a) if to PFPC, at 000 Xxxxxxxx Xxxxxxx, Xxxxxxxxxx, XX 00000; (b)
if to Bank of America, at Bank of America NT & SA, 000 Xxxxx Xxxxxxx Xxx., 25th
Floor, Unit 39277, Xxx Xxxxxxx, Xxxxxxxxxx 00000, Attn: Xxxxxx Xxxxxxx Xxxxx,
with a copy to Bank of America NT & SA, Legal Department, 000 Xxxxxx Xxxxxx,
0xx Xxxxx, Xxx Xxxxxxx, XX 00000, Attn: Xxxxxx X. Xxxxx; (c) if to the Fund,
at 000 Xxxxxxxx Xxxxxxx, Xxxxxxxxxx, XX 00000, with a copy to Vedder, Price,
Xxxxxxx & Kammholz, 000 X. XxXxxxx Xxxxxx, Xxxxxxx, XX 00000, Attention: Xxxxx
X. X'Xxxxx; or (d) if to none of the foregoing, at such other address as shall
have been provided to the sender of any such notice or other communication by
the other party.
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18. 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.
19. Assignment. This Agreement shall extend to and shall be
binding upon the parties hereto, and their respective successors and assigns;
provided, however, that this Agreement shall not be assignable by any party
without the written consent of the other parties.
20. 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.
21. Further Actions. Each party agrees to perform such
further acts and execute such further documents as are necessary to effectuate
the purposes hereof.
22. Miscellaneous.
(a) Entire Agreement. This Agreement embodies the
entire agreement and understanding among 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 and Oral Instructions.
(b) Captions. The captions in this Agreement are
included for convenience of reference only and in no way define or
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delimit any of the provisions hereof or otherwise affect their construction or
effect.
(c) Governing Law. 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.
(d) Partial Invalidity. 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.
(e) Successors and Assigns. This Agreement shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective successors and permitted assigns.
(f) Facsimile Signatures. The facsimile signature of
any party to this Agreement shall constitute the valid and binding
execution hereof by such party.
(g) Responsibility of Trustees, etc. The names "Time
Horizon Funds" and "Trustee of Time Horizon Funds" refer respectively to the
trust created and the trustees, as trustees but not individually or personally,
acting from time to time under a Declaration of Trust dated June 12, 1995, which
is hereby referred to and a copy of which is on file at the principal office of
the Fund. The trustees, officers, employees and agents of the Fund shall not
personally be bound by or liable under any written
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obligation, contract, instrument, certificate or other interest or undertaking
of the Fund made by the trustees or by an officer, employee or agent of the
Fund, in his or her capacity as such, nor shall resort be had to their private
property for the satisfaction of any obligation or claim thereunder. All persons
dealing with any class of shares of the Fund may enforce claims against the Fund
only against the assets belonging to such class.
(h) Reservation of Authority. Notwithstanding any other
provision of this Agreement, it is understood and agreed that the Fund shall at
all times retain the ultimate responsibility for directions and control of all
services provided pursuant to this Agreement, and retain the right to direct,
approve or disapprove any action taken hereunder, which responsibility and right
shall be reasonably exercised, provided, however, that this Paragraph 22(h)
shall not in any way limit or interfere with the rights and protections afforded
to PFPC pursuant to Paragraphs 5, 6, 8, 12 or 13 of this Agreement.
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:
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Title:
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BANK OF AMERICA NT & SA
By:
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Title:
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TIME HORIZON FUNDS
By:
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Title:
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EXHIBIT A
THIS EXHIBIT A, dated as of September 15, 1997, is Exhibit A
to that certain Sub-Administration and Accounting Services Agreement dated as of
September 15, 1997 among PFPC INC., BANK OF AMERICA NT & SA and TIME HORIZON
FUNDS.
PORTFOLIOS
TIME HORIZON PORTFOLIO 1
TIME HORIZON PORTFOLIO 2
TIME HORIZON PORTFOLIO 3
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AUTHORIZED PERSONS APPENDIX
NAME (Type) SIGNATURE
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