COMPLIANCE SERVICES AGREEMENT
AGREEMENT effective as of the 1st day of October, 2004, between ASSET
MANAGEMENT FUND LARGE CAP EQUITY INSTITUTIONAL FUND, INC. (the "Fund"), a New
York corporation having its principal place of business at 000 Xxxxx Xxxxxx,
Xxxxx 000, Xxx Xxxx, Xxx Xxxx 00000, and BISYS FUND SERVICES OHIO, INC.
("BISYS"), an Ohio limited partnership having its principal place of business at
0000 Xxxxxxx Xxxx, Xxxxxxxx, Xxxx 00000.
WHEREAS, the Fund is an investment company registered under the Investment
Company Act of 1940, as amended (the "1940 Act"), and will become subject to the
requirements of Rule 38a-1 under the 1940 Act, which requires each registered
investment company to adopt policies and procedures that are reasonably designed
to prevent it from violating the federal securities laws;
WHEREAS, BISYS performs certain management and administration services for
the Fund under an administration agreement between BISYS and the Fund dated
August 1, 1999 (as amended to date, the "Administration Agreement");
WHEREAS, BISYS is willing to perform the services enumerated in this
Agreement on the terms and conditions set forth in this Agreement; and
WHEREAS, BISYS and the Fund wish to enter into this Agreement in order to
set forth the terms under which BISYS will perform the services enumerated
herein on behalf of the Fund, and to supplement and clarify certain provisions
of the Administration Agreement.
NOW, THEREFORE, in consideration of the covenants herein contained, the
Fund and BISYS hereby agree as follows:
1. COMPLIANCE SERVICES.
(a) The Fund has adopted the written compliance polices and procedures
which, in the aggregate, are deemed by the Board of Directors of the Fund (the
"Board") to be reasonably designed to prevent the Fund from violating the
provisions of the Federal securities laws applicable to the Fund (the
"Applicable Securities Laws"), as required under Rule 38a-1 under the 1940 Act
(the "Fund Compliance Program").
(b) The Fund agrees to provide BISYS with copies of its current compliance
policies and procedures and furnish (and use reasonable good faith efforts to
cause its investment adviser, principal underwriter, administrator and transfer
agent (collectively, "Service Providers") other than BISYS and its affiliates to
furnish) all such additional information as may reasonably relate to the Fund
Compliance Program. Such information shall include compliance and related
information pertaining to the Service Providers' activities relating to the
Fund.
(c) BISYS will provide the following services in relation to the Fund
Compliance Program during the term of this Agreement: (i) make an individual
acceptable to the Board available to serve as the Fund's Chief Compliance
Officer to administer the Fund Compliance Program, to the extent provided in
Section 2(a) below; (ii) through the Chief Compliance Officer, assist in
maintaining the written policies and procedures comprising the Fund Compliance
Program, as may be amended from time to time; (iii) through the Chief Compliance
Officer, prepare and evaluate the results of annual reviews of the Fund
Compliance Program and the compliance policies and procedures of the Service
Providers; (iv) provide support services to the Chief Compliance Officer of the
Fund, including support for conducting an annual review of the Fund Compliance
Program and the compliance policies and procedures of Service Providers; (v)
through the Chief Compliance Officer and otherwise in support of the Fund
Compliance Program, develop standards for reports to the Board by Service
Providers; (vi) through the Chief Compliance Officer, develop standards for
reports to the Board by the Chief Compliance Officer; and (vii) through the
Chief Compliance Officer and otherwise in support of the Fund Compliance
Program, prepare or provide documentation for the Board to make findings and
conduct reviews pertaining to the Fund Compliance Program and compliance
programs and related policies and procedures of Service Providers.
2. PROVISION OF CHIEF COMPLIANCE OFFICER
(a) In connection with the compliance services to be rendered by BISYS
pursuant to Section 1 above, and subject to the provisions of this Section 2(a)
and to Section 2(b) below, BISYS agrees to make available to the Fund a person
to serve as the Fund's chief compliance officer responsible for administering
the Fund Compliance Program as provided in paragraph (a)(4) of Rule 38a-1 (the
"Chief Compliance Officer"). BISYS' obligation in this regard shall be met by
providing an appropriately qualified employee or agent of BISYS (or its
affiliates) who, in the exercise of his or her duties to the Fund, shall act in
good faith and in a manner reasonably believed by him or her to be in the best
interests of the Fund. In the event that the employment relationship or
independent contractor agency relationship between BISYS and any person made
available by BISYS to serve as Chief Compliance Officer terminates for any
reason, BISYS shall have no further responsibility to provide the services of
that particular person, and shall have no responsibility whatsoever for the
services to the Fund or other activities of such person provided or occurring
after such termination regardless of whether or not the Board terminates such
person as Chief Compliance Officer. In such event, upon the request of the Fund,
BISYS will employ reasonable good faith efforts to make another person available
to serve as the Chief Compliance Officer.
In connection with BISYS' commitment to make an appropriately qualified
person available to serve as Chief Compliance Officer, BISYS shall pay a level
of total compensation to such person as is consistent with BISYS' compensation
of employees having similar duties, similar seniority, and working at the same
or similar geographical location. BISYS shall not be obligated to pay any
compensation to a Chief Compliance Officer which exceeds that set forth in the
previous sentence.
The Fund will provide copies of the Fund Compliance Program, related
policies and procedures, and all other books and records of the Fund as the
Chief Compliance Officer deems necessary or desirable in order to carry out his
or her duties hereunder on behalf of the Fund. The Fund shall cooperate with the
Chief Compliance Officer and use reasonable good faith efforts to obtain the
cooperation of the Service Providers, as well as Fund counsel, independent
Director counsel, if any, and the Fund's independent accountants (collectively,
the "Other Providers"), and assist the Chief Compliance Officer in preparing,
implementing and carrying out the duties of the Chief Compliance Officer under
the Fund Compliance Program and Rule 38a-1. In addition, the Fund shall provide
the Chief Compliance Officer with appropriate access to the officers and
directors of the Fund, and to representatives of and to any records, files and
other documentation prepared by, Service Providers and Other Providers, which
are or may be related to the Fund Compliance Program.
Each party agrees to provide promptly to the other party (and to the Chief
Compliance Officer), upon request, copies of other records and documentation
relating to the compliance by such party with Applicable Securities Laws (as
related to the Fund Compliance Program of the Fund), and each party also agrees
otherwise to assist the other party (and the Chief Compliance Officer) in
complying with the requirements of the Fund Compliance Program and Applicable
Securities Laws.
(b) It is mutually agreed and acknowledged by the parties that the Chief
Compliance Officer will be an officer of the Fund. The provisions of Section
2(a) are subject to the internal policies of BISYS concerning the activities of
its employees and their service as officers of funds (the "BISYS Policies"), a
copy of which shall be provided to the Fund upon request.
The Fund shall provide coverage to the Chief Compliance Officer under its
directors and officers liability policy that is appropriate to the Chief
Compliance Officer's role and title, and consistent with coverage applicable to
the other officers of the Fund.
In appropriate circumstances, the Chief Compliance Officer shall have the
discretion to resign from his or her position, in the event that he or she
reasonably determines that there has been or is likely to be (a) a material
deviation from the BISYS Policies with respect to the Fund, (b) an ongoing
pattern of conduct involving the continuous or repeated violation of Applicable
Securities Laws by the Fund, or (c) a material deviation by the Fund from the
terms of this Agreement governing the services of such Chief Compliance Officer
that is not caused by such Chief Compliance Officer. In addition, the Chief
Compliance Officer shall have reasonable discretion to resign from his or her
position in the event that he or she determines that he or she has not received
sufficient cooperation from the Fund or its Other Providers to make an informed
determination regarding any of the matters listed above.
Each officer of the Fund may, and the Fund shall, promptly notify BISYS of
any issue, matter or event that would be reasonably likely to result in any
claim by the Fund, one or more Fund shareholder(s) or any third party which
involves an allegation that any executive officer of the Fund failed to exercise
his or her obligations to the Fund in a manner consistent with applicable laws.
Notwithstanding any provision of the Administration Agreement or any other
agreement or instrument that expressly or by implication provides to the
contrary, (a) it is expressly agreed and acknowledged that BISYS cannot ensure
that the Fund complies with the Applicable Securities Laws, and (b) whenever an
employee or agent of BISYS serves as Chief Compliance Officer of the Fund, as
long as such Chief Compliance Officer acts in good faith and in a manner
reasonably believed to be in the best interests of the Fund (and would not
otherwise be liable to the Fund by reason of willful misfeasance, bad faith,
gross negligence or reckless disregard of the duties involved in the conduct of
his or her office), the Fund shall indemnify the Chief Compliance Officer and
BISYS and hold the Chief Compliance Officer and BISYS harmless from any loss,
liability, expenses (including reasonable attorneys fees) and damages incurred
by them arising out of or related to the service of such employee or agent of
BISYS as Chief Compliance Officer of the Fund as provided in the Fund's
Certificate of Incorporation and By-laws.
3. FEES AND EXPENSES
(a) BISYS shall be entitled to receive from the Fund the amounts set forth
on Schedule A hereto, reflecting the amounts charged by BISYS for the
performance of services under this Agreement. The fees hereunder shall be in
addition to all fees and expenses charged by BISYS under the Administration
Agreement.
(b) In addition to paying BISYS the fees set forth in Schedule A, the Fund
agrees to reimburse BISYS for all of its actual out-of-pocket expenses
reasonably incurred in providing services under this Agreement, including but
not limited to the following:
(i) All reasonable out of pocket costs incurred in connection with
BISYS' provision of a Chief Compliance Officer to the Fund in
connection with compliance services, including travel costs for
attending Board meetings, conducting due diligence of Service
Providers pursuant to a policy approved by the Board; and
(ii) The reasonable costs incurred by BISYS in connection with the
Fund Compliance Program, including those costs incurred by or with
respect to Other Providers, in providing reports to the Chief
Compliance Officer under the Fund Compliance Program pursuant to a
policy approved by the Board.
(c) All rights of compensation under this Agreement for services performed
and for expense reimbursement shall survive the termination of this Agreement.
4. INFORMATION TO BE FURNISHED BY THE FUND
(a) The Fund has furnished or shall promptly furnish to BISYS copies of the
following, as amended and current as of the date of this Agreement:
(i) The Fund Compliance Program or the various policies and procedures
of the Fund that have been adopted through the date hereof which
pertain to compliance matters that are required to be covered by the
Fund Compliance Program, including the compliance programs of
Service Providers other than BISYS, as necessary under Rule 38a-1
for inclusion in the Fund Compliance Program.
(b) The Fund shall furnish BISYS written copies of any amendments to, or
changes in, any of the items referred to in Section 4(a) hereof, forthwith upon
such amendments or changes becoming effective. In addition, the Fund agrees that
no amendments will be made to the Fund Compliance Program, which might have the
effect of changing the procedures employed by BISYS in providing the services
agreed to hereunder or which amendment might affect the duties of BISYS
hereunder unless the Fund first obtains BISYS's approval of such amendments or
changes, which approval shall not be withheld unreasonably.
(c) BISYS may rely on all documents furnished to it by the Fund and its
agents in connection with the services to be provided under this Agreement,
including any amendments to or changes in any of the items to be provided by the
Fund pursuant to Section 4(a), and shall be entitled to indemnification in
accordance with Section 2(b) with regard to such reliance.
The Fund represents and warrants that (i) the provision of a Chief
Compliance Officer of the Fund by BISYS, as provided in Section 2 of this
Agreement, has been approved by the Board, and (ii) the individual nominated by
BISYS as the Fund's Chief Compliance Officer has been approved and appointed as
an officer of the Fund by the Board.
5. TERM AND TERMINATION
(a) The compliance services to be rendered by BISYS under this Agreement
(the "Compliance Services") shall commence upon the date of this Agreement and
shall continue in effect for one (1) year, until September 30, 2005, unless
earlier terminated pursuant to the terms of this Agreement. During such one year
term, the Compliance Services may be terminated upon thirty (30) days notice in
the event there is "cause," as defined in the Administration Agreement.
Following the one year anniversary of the date of this Agreement, the Compliance
Services may be terminated by either party for "cause," as provided above, or by
providing the other party with ninety (90) days written notice of termination.
(b) Notwithstanding anything in this Agreement to the contrary, including
but not limited to the provisions of Section 5(a), all of the obligations of
BISYS hereunder shall terminate automatically upon any termination of the
Administration Agreement.
6. NOTICE
Any notice provided hereunder shall be sufficiently given when sent by
registered or certified mail to the party required to be served with such notice
at the following address: if to the Fund, to 000 Xxxxx Xxxxxx, Xxxxx 000, Xxx
Xxxx, Xxx Xxxx 00000; Attn: President (with a copy to the Fund's legal counsel
at such address as may be provided to BISYS from time to time); and if to BISYS,
at 0000 Xxxxxxx Xxxx, Xxxxxxxx, Xxxx 00000; Attn: President, or at such other
address as such party may from time to time specify in writing to the other
party pursuant to this Section.
7. GOVERNING LAW AND CERTAIN MATTERS RELATING TO THE FUND
This Agreement shall be construed in accordance with the laws of the State
of Ohio and the applicable provisions of the 1940 Act. To the extent that the
applicable laws of the State of Ohio, or any of the provisions herein, conflict
with the applicable provisions of the 1940 Act, the latter shall control. It is
expressly agreed that the obligations of the Fund hereunder shall not be binding
upon any of the Directors, shareholders, nominees, officers, agents or employees
of the Fund personally, but shall bind only the property of the Fund. The
execution and delivery of this Agreement have been authorized by the Board, and
this Agreement has been signed and delivered by an authorized officer of the
Fund, acting as such, and neither such authorization by the Directors nor such
execution and delivery by such officer shall be deemed to have been made by any
of them individually or to impose any liability on them personally, but shall
bind only the property of the Fund.
8. REPRESENTATIONS AND WARRANTIES
Each party represents and warrants to the other that this Agreement has
been duly authorized and, when executed and delivered by it, will constitute a
legal, valid and binding obligation of it, enforceable against it in accordance
with its terms, subject to bankruptcy, insolvency, reorganization, moratorium
and other laws of general application affecting the rights and remedies of
creditors and secured parties.
9. MISCELLANEOUS
(a) Except as expressly provided in this Agreement, the terms of the
Administration Agreement shall apply to the services rendered under this
Agreement and the general provisions thereof shall be used on a residual basis
to construe any issues arising under this Agreement that are not addressed by
the express terms of this Agreement. Except as provided in this Agreement, the
provisions of the Administration Agreement remain in full force and effect
(including, without limitation, the term of the Agreement).
(b) The provisions set forth in this Agreement supersede all prior
negotiations, understandings and agreements bearing upon the subject matter
covered herein, including any conflicting provisions of the Administration
Agreement.
(c) No amendment or modification to this Agreement shall be valid unless
made in writing and executed by both parties hereto.
(d) Paragraph headings in this Agreement are included for convenience only
and are not to be used to construe or interpret this Agreement.
(e) This Agreement may be executed in counterparts, each of which shall be
an original but all of which, taken together, shall constitute one and the same
agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed all as of the day and year first above written.
ASSET MANAGEMENT FUND
LARGE CAP EQUITY INSTITUTIONAL
FUND, INC.
By:
--------------------------------
Name:
Title:
BISYS FUND SERVICES OHIO, INC.
By:
--------------------------------
Name:
Title:
SCHEDULE A
TO COMPLIANCE SERVICES AGREEMENT
DATED OCTOBER 1, 2004
COMPLIANCE SERVICES FEES
The Fund shall pay BISYS an annual fee of $25,000. The annual fee set forth
above shall be payable in equal monthly installments.
All recurring fees set forth above shall be subject to adjustment annually
commencing on the one-year anniversary of the date of this Agreement by the
percentage increase in consumer prices for services as measured by the United
States Consumer Price Index entitled "All Services Less Rent of Shelter" or a
similar index should such index no longer be published.
OUT OF POCKET EXPENSES
Out of pocket expenses are not included in the above fees and shall also be paid
to BISYS in accordance with the provisions of this Agreement.
