CO - ADMINISTRATION AGREEMENT
THIS AGREEMENT is made as of November 1, 2005, by and between BISYS FUND
SERVICES OHIO, INC. ("BISYS"), an Ohio corporation, and THE VICTORY PORTFOLIOS,
a Delaware statutory trust (the "Trust").
WHEREAS, the Trust is an open-end management investment company registered
under the Investment Company Act of 1940 (the "1940 Act");
WHEREAS, the Trust desires to retain BISYS as a co-administrator of the
Trust to perform certain fund administration services for the Trust and each
investment portfolio of the Trust, as now in existence and listed on Schedule C,
or as hereafter may be established from time to time (individually referred to
herein as the "Fund" and collectively as the "Funds");
WHEREAS, BISYS is willing to perform such services on the terms and
conditions set forth in this Agreement; and
WHEREAS, the parties hereto wish to enter into this Agreement in order to
set forth the terms under which BISYS will perform the services set forth herein
for the Trust.
NOW, THEREFORE, in consideration of the mutual premises and covenants
hereinafter contained, the parties hereto agree as follows:
1. Retention of BISYS/ Responsibilities of the Co-Administrator.
(a) The Trust hereby appoints BISYS as a co-administrator of the Trust.
Victory Capital Management, Inc. (the "Adviser") will serve as the other
co-administrator of the Trust pursuant to a separate co-administration agreement
(the "Adviser Co-Administration Agreement") between the Trust and the Adviser.
BISYS and the Adviser are referred to herein collectively as the
"Co-Administrators." BISYS as Co-Administrator will provide the services set
forth herein. BISYS shall, for all purposes herein, be deemed to be an
independent contractor and, except as otherwise expressly provided or
authorized, shall have no authority to act for or represent the Trust or the
Funds in any way, and shall not be deemed an agent of the Trust or any Funds.
(b) The rights and obligations of each of the Co-Administrators are
several, not joint. BISYS shall not be responsible for the performance of the
duties and responsibilities of the Adviser, nor shall BISYS be liable for the
actions of the Adviser.
2. Responsibilities of BISYS as the Co-Administrator.
BISYS shall perform the administration services set forth in Schedule A.
BISYS shall perform such other administration services, and furnish such other
reports, for the
Funds that are mutually agreed upon by the parties from time to time, for which
the Trust will pay BISYS the amounts agreed upon between them.
BISYS may, at its expense, utilize agents in its performance of its
services; provided, however, that (i) the approval of the Board of Trustees of
the Trust (the "Board") shall be required to establish an arrangement in which a
sub-agent of BISYS acts as sub-administrator (a "Sub-Agent"); and (ii) any agent
(including any Sub-Agent) retained by BISYS shall be the agent of BISYS and not
the agent the Trust, and BISYS shall be fully responsible for the acts of any
such agent (or Sub-Agent) and shall not be relieved of any of its
responsibilities hereunder by the appointment of such agent (or Sub-Agent). In
the event that a Sub-Agent is retained by BISYS at the request or instruction of
the Trust, the foregoing shall not apply to the extent it is inconsistent with
any written agreement(s) entered into by the parties with respect to such
arrangement.
3. Allocation of Charges and Expenses.
BISYS shall bear its own expenses in connection with the performance of
its duties and responsibilities hereunder, except as provided herein; provided,
however, that the Trust shall reimburse BISYS for its reasonable travel and
related expenses incurred in attending Board meetings. BISYS shall also furnish
at its own expense the executive, supervisory and clerical personnel necessary
to perform its obligations under this Agreement. BISYS shall pay all
compensation, if any, of officers of the Trust who are its own officers,
employees or directors or who are officers employees or directors of its
affiliated entities. Unless otherwise specifically provided herein, BISYS shall
not be obligated to pay the compensation of any employee or agent of the Trust
(who is not an officer employee or director of the BISYS or its affiliated
entities) retained by the Board.
The Trust will pay or cause to be paid any other expenses incurred in the
operation of the Funds that are not otherwise allocated herein (or subject to
another contractual arrangement between the parties or are to be paid under the
Adviser Co-Administration Agreement), including, without limitation, Fund
organization costs, taxes, expenses for Fund legal and auditing services, costs
of maintaining corporate existence, the expenses of preparing (including
typesetting), printing and mailing reports, prospectuses, statements of
additional information, proxy solicitation material and notices to existing
Shareholders, all expenses incurred in connection with issuing and redeeming
shares of beneficial interest in the Funds ("Shares"), the cost of custodial
services, transfer and dividend disbursing agents' fees, fund accounting agents'
fees, the cost of initial and ongoing registration of the Shares under Federal
and state securities laws, fees and out-of-pocket expenses of Trustees who are
not affiliated persons of BISYS or any affiliate of BISYS, Trust meetings,
insurance, interest, brokerage costs and commissions, if any, litigation and
other extraordinary or nonrecurring expenses, and all fees and charges of
investment advisers.
4. Compensation of BISYS
(a) The Trust shall pay BISYS for its respective services to be provided
under this Agreement the fees set forth in the fee schedule set forth in
Schedule B. For
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purposes of determining fees, the value of each Fund's net assets shall be
computed in accordance with the terms of the Fund's Prospectus. Such fee as is
attributable to each Fund shall be a separate (and not joint or joint and
several) obligation of each such Fund. No individual Fund shall have any
responsibility for any obligation, if any, with respect to any other Fund
arising out of this Agreement.
(b) If this Agreement becomes effective subsequent to the first day of a
month or terminates in accordance with its terms before the last day of a month,
BISYS' compensation for that part of the month in which this Agreement is in
effect shall be prorated in a manner consistent with the calculation of the fees
as set forth on Schedule B.
(c) All rights of compensation under this Agreement for services
performed as of the termination date shall survive the termination of this
Agreement.
5. Term.
(a) This Agreement becomes effective on the date first set forth above
(the "Effective Date"). Upon the Effective Date, the services, compensation and
expense provisions of this Agreement shall become fully effective. This
Agreement shall continue in effect for a period of two years from the Effective
Date, until October 31, 2007 (the "Initial Term"). Thereafter, unless otherwise
terminated as provided herein, this Agreement shall be renewed automatically for
successive one year periods ("Rollover Periods"); provided that such continuance
is specifically approved by a vote of a majority of those members of the Board
of Trustees of the Trust who are not parties to this Agreement or "interested
persons" of any such party, and by the vote of the Trusts Board of Trustees or a
majority of the outstanding voting securities of such Fund. This Agreement may
be terminated (i) by provision of a written notice of non-renewal at least sixty
(60) days prior to the end of the Initial Term or any Rollover Period, as the
case may be, (ii) by mutual agreement of the parties or (iii) for "cause," as
defined below, upon the provision of sixty (60) days advance written notice by
the party alleging cause. In addition, the Trust may terminate this Agreement
upon written notice to BISYS in the event that the Adviser Co-Administration
Agreement has terminated; provided, however, that such termination will be
subject to payment of liquidated damages pursuant to Section 5(d) of this
Agreement.
(b) For purposes of this Section 5, "Cause" shall mean (i) a material
breach of this Agreement, including a material breach of any representations and
warranties contained herein, that has not been remedied for thirty (30) days
following written notice of such breach from the non-breaching party; (ii) a
final, unappealable judicial, regulatory or administrative ruling or order in
which the party to be terminated has been found guilty of criminal or unethical
behavior in the conduct of its business; or (iii) financial difficulties on the
part of the party to be terminated which are evidenced by the authorization or
commencement of, or involvement by way of pleading, answer, consent or
acquiescence in, a voluntary or involuntary case under Title 11 (Bankruptcy) of
the United States Code, as from time to time is in effect, or any applicable
law, other than said Title 11, of any jurisdiction relating to the liquidation
or reorganization of debtors or
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to the modification or alteration of the rights of creditors. BISYS shall not
terminate this Agreement pursuant to clause (i) above based solely upon the
Trust's failure to pay an amount to BISYS which is the subject of a good faith
dispute, if (x) the Trust is attempting in good faith to resolve such dispute
with as much expediency as may be possible under the circumstances, and (y) the
Trust continues to perform its obligations hereunder in all other material
respects (including paying all fees and expenses not subject to reasonable
dispute hereunder).
(c) Notwithstanding the foregoing termination provisions, following any
such termination, in the event that BISYS in fact continues to perform any one
or more of the services contemplated by this Agreement (or any Schedule or
exhibit hereto) with the consent of the Trust, the provisions of this Agreement,
including without limitation the provisions dealing with compensation and
indemnification, shall continue in full force and effect. Fees and out-of-pocket
expenses incurred by BISYS but unpaid by the Trust upon such termination shall
be immediately due and payable upon and notwithstanding such termination. In the
event of a termination other than a termination for cause, BISYS shall be
entitled to collect from the Trust, in addition to the fees and expenses
provided in Sections 3 and 4 of this Agreement, the amount of all of BISYS'
reasonable cash disbursements in connection with BISYS' activities in effecting
such termination, including without limitation, the delivery to the Trust,
and/or other parties of the Funds' property, records, instruments and documents.
Subsequent to such termination, for a reasonable fee, BISYS will provide the
Trust with reasonable access to any Trust documents or records remaining in its
possession.
(d) If for any reason other than (i) non-renewal, (ii) mutual agreement of
the parties, or (iii) "cause" for termination of BISYS hereunder, BISYS'
services are terminated hereunder, BISYS is replaced as a Co-Administrator, or
if a third party is added to perform a substantive portion of the administration
services to be provided by BISYS under this Agreement (excluding any Sub-Agent
appointed as provided in Section 2 hereof), then the Trust shall make a one-time
cash payment, in consideration of the fee structure and services to be provided
under this Agreement, and not as a penalty, to BISYS equal to the balance that
would be due BISYS for its services hereunder during (x) the next twelve (12)
months or (y) if less than twelve (12) months remain until the end of the
then-current term, the number of months remaining in the then-current term,
assuming for purposes of the calculation of the one-time payment that the fees
that would be earned by BISYS for each month shall be based upon the average
fees payable to BISYS monthly during the twelve (12) months prior to the date
that services terminate, BISYS is replaced or a third party is added; provided,
however, that this liquidated damages provision shall not be applicable to
liquidations of individual Funds which may occur from time to time for
legitimate economic or regulatory reasons, as determined by the Board. The
calculation of payments to BISYS by reference to the period of up to twelve
months contemplated by the preceding sentence shall apply only during this
Agreement's initial two-year term; during any subsequent Rollover Period, the
maximum reference period for such payments shall be six months. For the
avoidance of doubt, the Trust may terminate this Agreement at any time upon not
less than 60 days' written notice to BISYS, provided that the Trust otherwise
complies with all applicable
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provisions of this Agreement, including, without limitation, the obligation to
pay liquidated damages where applicable.
(e) The one-time cash payment referenced above shall be due and payable on
the day prior to the first day in which services are terminated, BISYS is
replaced or a third party is added.
(f) In the event the Trust or any Fund is merged into another legal entity
in part or in whole pursuant to any form of business reorganization or is
liquidated in part or in whole prior to the expiration of the then-current term
of this Agreement, the parties acknowledge and agree that the liquidated damages
provision set forth above shall be applicable in those instances in which BISYS
is not retained to provide administration services consistent with this
Agreement to the successor fund or funds, if any.
(g) The parties further acknowledge and agree that, in the event services
are terminated, BISYS is replaced, or a third party is added, as set forth
above, (i) a determination of actual damages incurred by BISYS would be
extremely difficult, and (ii) the liquidated damages provision contained herein
is intended to adequately compensate BISYS for damages incurred and is not
intended to constitute any form of penalty.
6. Standard of Care; Uncontrollable Events; Limitation of Liability.
BISYS shall use reasonable professional diligence in the performance of
services under this Agreement, but shall not be liable to the Trust for any
action taken or omitted by it in the absence of bad faith, willful misfeasance,
negligence or reckless disregard by it of its obligations and duties. The duties
of each of BISYS shall be confined to those expressly set forth herein, and no
implied duties are assumed by or may be asserted against BISYS hereunder.
BISYS shall maintain adequate and reliable computer and other equipment
necessary or appropriate to carry out its obligations under this Agreement. Upon
the Trust's reasonable request, BISYS shall provide supplemental information
concerning the aspects of its disaster recovery and business continuity plan
that are relevant to the services provided hereunder. Notwithstanding the
foregoing or any other provision of this Agreement, BISYS does not assume any
responsibility hereunder, and shall not be liable for, any damage, loss of data,
delay or any other loss whatsoever caused by events beyond its reasonable
control. Events beyond BISYS' reasonable control include, without limitation,
force majeure events. Force majeure events include natural disasters, actions or
decrees of governmental bodies, and communication lines failures that are not
the fault of either party. In the event of force majeure, computer or other
equipment failures or other events beyond its reasonable control, BISYS shall
follow applicable procedures in its disaster recovery and business continuity
plan and use all commercially reasonable efforts to minimize any service
interruption.
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BISYS shall provide the Trust, at such times as the Trust may reasonably
request, copies of reports rendered by independent public accountants on its
internal controls and procedures relating to the services provided by it under
this Agreement.
NOTWITHSTANDING ANYTHING IN THIS AGREEMENT TO THE CONTRARY, IN NO EVENT
SHALL BISYS, ITS AFFILIATES OR ANY OF ITS OR ITS DIRECTORS, OFFICERS, EMPLOYEES,
AGENTS OR SUBCONTRACTORS BE LIABLE FOR EXEMPLARY, PUNITIVE, INDIRECT OR
CONSEQUENTIAL DAMAGES, OR LOST PROFITS, EACH OF WHICH IS HEREBY EXCLUDED BY
AGREEMENT OF THE PARTIES REGARDLESS OF WHETHER SUCH DAMAGES WERE FORESEEABLE OR
WHETHER A PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
7. Legal Advice.
BISYS shall notify the Trust at any time BISYS believes that it is in need
of the advice of counsel to the Trust with regard to BISYS' responsibilities and
duties pursuant to this Agreement. The Trust may authorize counsel to the Trust
to give such advice to BISYS; provided, however, this Agreement shall not
obligate counsel to the Trust to give any such advice, and counsel to the Trust
is free to decline to provide such advice for any reason or for no reason. To
the extent that counsel to the Trust provides any such written advice, which
advice will be at the Trust's expense, BISYS may rely on such advice. BISYS may
rely upon any other written advice provided by any other counsel, accountant or
other expert authorized in writing by the Trust to provide such advice to BISYS,
which authorization will not be unreasonably withheld or delayed. In no event
shall BISYS be liable to the Trust or any Fund or any shareholder or beneficial
owner of the Trust for any action reasonably taken pursuant to written advice
provided by an expert explicitly authorized by the Trust. In the event that the
Trust does not authorize such other expert to provide advice to BISYS, BISYS
may, at its own cost and at its own risk, obtain its own legal advice from its
own counsel or other experts.
As to the services to be provided hereunder, this Agreement sets forth the
terms and conditions under which the services described herein are to be
performed. To the extent of any inconsistency between this Agreement and any
description, if any, of the services to be provided hereunder that may be
contained the Prospectuses and Statement of Additional Information of the Trust
relating to the relevant Funds, BISYS may rely on the description contained in
that Prospectus or Statement of additional information unless BISYS receives
written instructions to the contrary in a timely manner from the Trust.
8. Instructions / Certain Procedures, etc.
BISYS shall be protected in acting upon any document that it reasonably
believes to be genuine and to have been signed or presented by a duly authorized
person on behalf of the Trust. Unless BISYS is otherwise aware of such change of
authority, BISYS will not be held to have notice of any change of authority of
any officers, employees or agents of the Trust or the Adviser until receipt of
actual notice thereof from the Trust.
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In performing the Services, BISYS may rely conclusively upon the terms of
the Prospectuses and Statement of Additional Information of the Trust relating
to the relevant Funds, as well as the minutes of Board meetings (if applicable)
and other records of the Trust. BISYS shall be protected in acting upon any
document which it reasonably believes to be genuine and to have been signed or
presented by the proper person or persons, excluding BISYS employees.
9. Indemnification.
The Trust agrees to indemnify and hold harmless BISYS, and its employees,
agents, directors, officers and nominees from and against any claims, demands,
actions, suits, judgments, liabilities, losses, damages, costs, charges, counsel
fees and other expenses including reasonable investigation expenses
(collectively, "Losses") resulting directly and proximately from BISYS'
performance of services under this Agreement or based, if applicable, upon its
reasonable reliance on information, records, instructions or requests pertaining
to services hereunder, that are given or made to it by the Trust, or other
authorized agents of the Trusts with which BISYS must interface in providing
services; provided that this indemnification shall not apply to actions or
omissions of BISYS involving bad faith, willful misfeasance, negligence or
reckless disregard by it of its obligations and duties.
BISYS shall indemnify, defend, and hold the Trust, and its directors,
officers, agents and nominees harmless from and against Losses resulting
directly and proximately from BISYS' willful misfeasance, bad faith or
negligence in the performance of, or the reckless disregard of, its duties or
obligations hereunder.
The indemnification rights hereunder shall include the right to reasonable
advances of defense expenses in the event of any pending or threatened
litigation with respect to which indemnification hereunder may ultimately be
merited provided that any such advanced expenses shall be reimbursed by the
indemnified party if an ultimate determination is made on the merits by a court
or other tribunal of competent jurisdiction that the indemnified party is not
entitled to indemnification hereunder. In order that the indemnification
provisions contained herein shall apply, however, it is understood that if in
any case a party may be asked to indemnify or hold the other party harmless, the
indemnified party will use all reasonable care to identify and notify the
indemnifying party promptly concerning any situation which presents or appears
likely to present the probability of such a claim for indemnification against
the indemnifying party together with all facts pertinent to the situation, but
failure to do so in good faith shall not affect the rights hereunder except to
the extent the indemnifying party is materially prejudiced thereby. As to any
matter eligible for indemnification, an indemnified party shall act reasonably
and in accordance with good faith business judgment and shall not effect any
settlement or confess judgment without the consent of the indemnifying party,
which consent shall not be withheld or delayed unreasonably.
The indemnifying party shall be entitled to participate at its own expense
or, if it so elects, to assume the defense of any suit brought to enforce any
claims subject to this indemnity provision. If the indemnifying party elects to
assume the defense of any such
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claim, the defense shall be conducted by counsel chosen by it and reasonably
satisfactory to the indemnified party, whose approval shall not be withheld or
delayed unreasonably. In the event that the indemnifying party elects to assume
the defense of any suit and retain counsel, the indemnified party shall bear the
fees and expenses of any additional counsel retained by it. An indemnifying
party shall not effect any settlement without the consent of the indemnified
party (which shall not be withheld or delayed unreasonably by the indemnified
party) unless such settlement imposes no liability, responsibility or other
obligation upon the indemnified party and does not express, imply or impute
fault to the indemnified party. If the indemnifying party does not elect to
assume the defense of suit, it will reimburse the indemnified party for the
reasonable fees and expenses of any counsel retained by the indemnified party.
The indemnity and defense provisions set forth herein shall indefinitely survive
the termination of this Agreement.
10. Record Retention and Confidentiality.
BISYS shall keep and maintain all books and records which are customary or
which are required to be kept in connection with BISYS' services pursuant to
applicable statutes, rules and regulations, including without limitation Rules
31a-1 and 31a-2 under the 1940 Act. BISYS further agrees that all such books and
records shall be the property of the Trust. BISYS shall surrender such documents
promptly to the Trust on request, and made available for inspection by the
Trust, or by the Commission upon demand.
BISYS shall otherwise keep confidential all books and records relating to
the Trust and its shareholders, except when (i) disclosure is required by law,
(ii) BISYS is advised by counsel that it may incur liability for failure to make
a disclosure, (iii) BISYS is requested to divulge such information by a court,
governmental agency or entity or by a self-regulatory organization registered
under the Securities Exchange Act of 1934, or (iv) as requested or authorized by
the Trust (including pursuant to its policies and procedures). BISYS shall
provide the Trust with reasonable advance notice of disclosure pursuant to items
(i) - (iii) of the previous sentence, to the extent reasonably practicable.
11. Return of Records.
BISYS shall promptly upon the Trust's demand, turn over to the Trust and
cease to retain the files, records and documents created and maintained by it
pursuant to this Agreement which are no longer needed by it in the performance
of its services or for its legal protection.
12. Representations and Warranties of the Trust.
The Trust represents and warrants to BISYS that:
(a) The Trust is a trust duly incorporated and validly existing
under the laws of its state of organization, and has full
capacity and authority to enter into this agreement and to
carry out its obligations hereunder;
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(b) It has all necessary authorizations, licenses and permits to
carry out its business as currently conducted;
(c) It is in compliance in all material respects with all laws and
regulations applicable to its business and operations;
(d) This Agreement has been duly authorized by the Trust and, when
executed and delivered by the Trust, will constitute a legal,
valid and binding obligation of the Trust, enforceable against
the Trust in accordance with its terms, subject to bankruptcy,
insolvency, reorganization, moratorium and other laws of
general application affecting the right and remedies of
creditors and secured parties;
13. Representations and Warranties of BISYS.
BISYS represents and warrants to the Trust that:
(a) It is a corporation duly incorporated and validly existing under
the laws of the state of its organization, and has full capacity and
authority to enter into this agreement and to carry out its
obligations hereunder;
(b) It has all necessary authorizations, licenses and permits to
carry out its business as currently conducted;
(c) It is, and shall continue to be, in compliance in all material
respects with all provisions of law applicable to it in connection
with its services hereunder;
(d) The various procedures and systems which it has implemented with
regard to safekeeping from loss or damage attributable to fire,
theft or any other cause of the blank checks, records, and other
data and its' equipment, facilities, and other property used in the
performance of its obligations hereunder are reasonable and adequate
and that it will make such changes therein from time to time as are
reasonably required for the secure performance of its obligations
hereunder;
(e) This Agreement has been duly authorized by it 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 right and
remedies of creditors and secured parties; and
(f) it will maintain sufficient and experienced personnel and an
adequate infrastructure to enable it to perform its obligations
hereunder.
EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT, ALL REPRESENTATIONS AND
WARRANTIES, INCLUDING, WITHOUT
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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) CONCERNING THE SERVICES OR ANY GOODS PROVIDED
INCIDENTAL TO THE SERVICES PROVIDED UNDER THIS AGREEMENT BY THE
CO-ADMINISTRATORS ARE COMPLETELY DISCLAIMED.
14. Insurance.
BISYS shall maintain a fidelity bond covering larceny and embezzlement and
an insurance policy with respect to directors and officers errors and omissions
coverage, in amounts that are appropriate in light of its duties and
responsibilities hereunder. Upon the request of the Trust, BISYS shall provide
evidence that coverage is in place. BISYS shall notify the Trust should its
insurance coverage with respect to professional liability or errors and
omissions coverage be reduced or canceled. Such notification shall include the
date of cancellation or reduction and the reasons therefore. BISYS shall notify
the Trust promptly of any material claims against it with respect to services
performed under this Agreement, whether or not they may be covered by insurance,
and shall notify the Trust promptly should the total outstanding claims made by
BISYS under its insurance coverage materially impair, or threaten to materially
impair, the adequacy of its coverage.
15. Information to be Furnished by the Trust.
(a) The Trust will furnish to BISYS the following upon request:
(i) A copy of the Trust's Certificate of Trust and any
amendments thereto;
(ii) A copy of the Trust's By-laws and any amendments thereto;
(iii) A copy of the resolutions of the Board regarding (A)
approval of this Agreement and authorization for the Trust to
instruct BISYS hereunder; and (B) authorization of BISYS to act as
Co-Administrator for the Trust;
(iv) A certified list of all officers of the Funds, including
the Funds' AML Compliance Officer, and any other persons together
with specimen signatures of those officers and other persons who
(except as otherwise provided herein to the contrary) shall be
authorized to instruct BISYS in all matters. Any delay in delivery
of this list shall not relieve the Co-Administrator of any actual
knowledge it may possess of any change in authority of persons
authorized to provide instructions to BISYS.;
(v) A copy of the AML Program, including any related policies
and procedures;
(vi) The Trust's most recent Post-Effective Amendment to its
Registration Statement(s) under the Securities Act of 1933, as
amended (
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the "1933 Act"), and under the 1940 Act, on Form N-1A as filed with
the Securities and Exchange Commission (the "Commission") relating
to the Shares and any further amendment thereto;
(vii) Notification of registration of the Trust under the 1940
Act on Form N-8A as filed with the Commission;
(viii) Prospectuses and Statements of Additional Information
of the Trust with respect to the Funds (such prospectuses and
statements of additional information, as presently in effect and as
they shall from time to time be amended and supplemented, herein
called individually, the "Prospectus" and collectively, the
"Prospectuses"); and
(ix) The Trust DCPs (as hereinafter defined).
(b) The Trust shall furnish BISYS written copies of any amendments
to, or changes in, any of the items referred to in Section 15(a) hereof,
forthwith upon such amendments or changes becoming effective. In addition,
the Trust agrees that no amendments will be made to the AML Program, or
the Trust DCPs 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 Trust
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 Trust 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 Trust pursuant to Section 15(a), and shall be entitled
to indemnification in accordance with Section 9 below with regard to such
reliance.
(d) The Trust represents and warrants that (A) the provision of
certain officers of the Trust by BISYS, as provided in Section 17 of this
Agreement, has been approved by the Board, and (B) each of the individuals
nominated by BISYS as the Trust's AML Compliance Officer or Financial
Officer has been approved and appointed as an officer of the Trust by the
Board.
(e) BISYS shall be deemed to have received any document with respect
to the Trust that is filed with the SEC and available on XXXXX, unless the
Trust files such document without BISYS' knowledge.
16. Information Furnished by BISYS.
BISYS will furnish to the Trust upon request, evidence of the approval of
this Agreement by BISYS, and authorization of a specified officer of BISYS to
execute and deliver this Agreement.
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17. Compliance with Laws; Provision of Executive Officers
(a) Prospectus and Public Offering. Except for information BISYS
is obligated to keep pursuant to Section 10 hereof and as
specifically provided in the schedules hereto, the Trust
assumes full responsibility for the preparation, contents, and
distribution of each Prospectus of the Trust in compliance
with all applicable requirements of the Securities Act of
1933, as amended (the "1933 Act"), the 1940 Act, and any other
laws, rules and regulations of governmental authorities having
jurisdiction. BISYS shall have no obligation to take
cognizance hereunder of laws relating to the sale of the
Trust's shares. The Trust represents and warrants that all
shares of the Trust that are offered to the public are covered
by an effective registration statement under the 1933 Act and
the 1940 Act.
(b) Anti-Money Laundering. The Trust acknowledges that it is a
financial institution subject to the law entitled Uniting and
Strengthening America by Providing Appropriate Tools Required
to Intercept and Obstruct Terrorism ("U.S.A. Patriot") Act of
2001 and the Bank Secrecy Act and shall comply with the such
Acts and applicable regulations adopted thereunder (such Acts
and regulations collectively, the "Applicable AML Laws") in
all relevant respects.
(c) Provision of AML Compliance Officer
Subject to the provisions set forth in Section 17(b) above,
this Section 17(c), and Section 17(e) below, BISYS agrees to
make available to the Trust a person to serve as the Trust's
AML Compliance Officer. BISYS's 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 Trust, shall act in good faith and in
a manner reasonably believed by him or her to be in the best
interests of the Trust. Subject to the Trust's cooperation in
implementing and complying with its AML Program, the AML
Compliance Officer will assist the Trust in operating its AML
Program, and shall perform the duties assigned to the AML
Compliance Officer which are set forth in the AML Program.
The Trust shall provide copies of all books and records of the
Trust, as the AML Compliance Officer deems necessary or
desirable in order to carry out his or her duties hereunder on
behalf of the Trust. Each party agrees to provide promptly to
the other party (and to the AML Compliance Officer), upon
request, copies of such other records and documentation
relating to the compliance by such party with Applicable AML
Laws (in relation to the Trust), and each party also agrees
otherwise to assist the other party (and the AML
12
Compliance Officer) in complying with the requirements of the
AML Program and Applicable AML Laws.
Each party agrees to retain a copy of all documents and
records prepared, maintained or obtained by it relating to
shareholders and transactions for a period of at least five
(5) years after either the relationship with the shareholder
has ended or the execution of the transaction. The foregoing
is not intended to limit any obligation to retain any
specified records for any other period that may be specified
in the AML Program or under Applicable AML Laws.
BISYS shall be entitled to receive the fees set forth on
Schedule B for the provision of the AML Compliance Officer.
(d) Provision of Certifying Officer
Subject to the provisions of this Section 17(d) and Section
17(e) below, BISYS shall make a BISYS employee available to
the Trust to serve, upon designation as such by the Board, as
the Chief Financial Officer of the Trust or under such other
title to perform similar functions (a "Certifying Officer").
BISYS's obligation in this regard shall be met by providing an
appropriately qualified employee of BISYS (or its affiliates)
who, in the exercise of his or her duties to the Trust, shall
act in good faith and in a manner reasonably believed by him
or her to be in the best interests of the Trust. BISYS shall
select, and may replace, the specific employee that it makes
available to serve in the designated capacity as a Certifying
Officer, in BISYS's reasonable discretion, taking into account
such person's responsibilities concerning, and familiarity
with, the Trust's operations.
For so long as BISYS provides a Certifying Officer, (a) there
shall be a DCP Committee (as defined below), and (b) the
Trust's disclosure and control procedures (the "Trust DCPs")
shall contain (or the Trust and BISYS shall otherwise
establish) mutually agreeable procedures governing the
certification of Form N-CSR, Form N-Q, and any other forms
required to be certified pursuant to Sections 302 or 906 of
the Xxxxxxxx-Xxxxx Act of 2002, Rule 30a-2 under the 1940 Act,
or any other related law or regulation (collectively, "SO
Laws" and such forms, collectively, "Reports"), and the
parties shall comply with such procedures in all material
respects. Among other things, the procedures shall provide as
follows:
(i) The Co-Administrators shall establish and maintain a
Disclosure Controls and Procedures Committee (the "DCP
Committee") to evaluate the Trust DCPs in accordance
with Rule 30a-3 under the 1940 Act. The DCP Committee
shall
13
include (at a minimum) the Trust's Principal Executive
Officer, Chief Financial Officer, and Chief Legal
Officer (if any) and such other individuals as may be
necessary or appropriate to enable the DCP Committee to
ensure the cooperation of, and to oversee, each of the
Trust's agents that records, processes, summarizes, or
reports information contained in Trust Reports (or any
information from which such information is derived),
including the Funds' investment advisors, custodians,
and other service providers to the Trust or any Fund
("Other Providers"). The Co-Administrators may from time
to time request appropriate approvals from the Board
with respect to the DCP Committee.
(ii) The Trust shall require (A) that sub-certifications on
internal controls, upon which the Certifying Officer may
rely in certifying Reports, be provided by Other
Providers in form and content reasonably acceptable to
the Certifying Officer and consistent with the SO Laws,
and (B) that such sub-certifications are delivered to
the DCP Committee and the Certifying Officer
sufficiently in advance of the DCP Committee meeting
described in (iii) below. BISYS shall obtain such
sub-certifications from such Other Providers.
(iii) The DCP Committee shall (A) establish a schedule to
ensure that all required disclosures in any Report,
including the financial statements, for the Trust are
identified and prepared in a timeframe sufficient to
allow review, (B) meet prior to the filing date of each
Report to review the accuracy and completeness of the
relevant Report, and (C) record its considerations and
conclusions in a written memorandum sufficient to
support conclusions pertaining to Trust DCPs as required
by the instructions to Form N-CSR or Form N-Q. In
conducting its review and evaluations, the DCP Committee
shall:
A. review SAS 70 reports pertaining to BISYS and Other
Providers, if applicable, or in the absence of any such
reports, consider the adequacy of the sub-certifications
supplied by the service provider. In cases where the SAS
70 report is dated more than 90 days prior to the
issuance of a Report, the DCP Committee shall request a
written representation from the service provider
regarding the continued application and effectiveness of
internal controls described in the report, or
descriptions of any changes in internal control
structure, as of the date of the representation;
14
B. consider whether there are any significant
deficiencies or material weaknesses in the design or
operation of the Trust DCPs or internal controls over
financial reporting that could adversely affect the
Trust's ability to record, process, summarize, and
report financial information, and in the event that any
such weaknesses or deficiencies are identified, disclose
them to the Trust's Certifying Officers, audit
committee, and auditors;
C. consider whether, to the knowledge of any member of
the DCP Committee, there has been or may have been any
fraud, whether or not material, and, if so, disclose to
the Certifying Officers, and the Trust's audit committee
and auditors; and
D. determine whether there was any change in internal
controls over financial reporting that occurred during
the Trust's second quarter of the period covered by the
Report for Reports on Form N-CSR or during the most
recent fiscal quarter for Reports on Form N-Q that has
materially affected or is reasonably likely to
materially affect, the Trust's internal control over
financial reporting.
A Certifying Officer shall have the full discretion to decline to certify
a particular Report that fails to meet the standards set forth in the
Certification, and to report matters involving fraud or other failures to meet
the standards of applicable law to the audit committee of the Board.
The Trust shall, in its own capacity, take all reasonably necessary and
appropriate measures to comply with its obligations under SO Laws. Without
limitation of the foregoing, except for those obligations which are expressly
delegated to or assumed by BISYS in this Agreement, the Trust shall maintain
responsibility for, and shall support and facilitate the role of each Certifying
Officer and the DCP Committee in, designing and maintaining the Trust's DCPs in
accordance with applicable laws.
(e) Additional Provisions Concerning Executive Officers It is
mutually agreed and acknowledged by the parties that any
Certifying Officer provided by BISYS under the provisions of
this Section 17 will be executive officers of the Trust
("Executive Officers"). In addition, the parties agree that an
AML Compliance Officer provided by BISYS shall be considered
an Executive Officer of the Trust for purposes of this Section
17(e). The provisions of Sections 17(c) - (d) 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
Trust upon request. The Trust's governing documents (including
its Agreement and Declaration of Trust and By-Laws) and/or
resolutions of the Board shall contain mandatory
15
indemnification provisions that are applicable to each
Executive Officer, that are designed and intended to have the
effect of fully indemnifying him or her and holding him or her
harmless with respect to any claims, liabilities and costs
arising out of or relating to his or her service in good faith
in a manner reasonably believed to be in the best interests of
the Trust, except to the extent he or she would otherwise be
liable to the Trust 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 Trust shall provide coverage to each Executive Officer
under its directors and officers liability policy that is
appropriate to the Executive Officer's role and title, and
consistent with coverage applicable to other officers holding
positions of executive management.
In appropriate circumstances, each Executive 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; (b) a violation of SO Laws, Applicable AML Laws, or
Federal or state securities laws and regulations applicable to
the Trust ("Applicable Securities Laws"), or (c) a material
deviation by the Trust from the terms of this Agreement
governing the services of such Executive Officer that (in
either case) is not primarily caused by the failure of such
Executive Officer or BISYS to meet their own obligations under
applicable laws and this Agreement. In addition, each
Executive 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 Trust or its Other Providers to make an
informed determination regarding any of the matters listed
above.
Each Executive Officer may, and the Trust shall, promptly
notify BISYS of any issue, matter or event that would be
reasonably likely to result in any claim by the Trust, the
Trust's shareholders or any third party which involves an
allegation that any Executive Officer failed to exercise his
or her obligations to the Trust in a manner consistent with
applicable laws (including but not limited to any claim that a
Report failed to meet the standards of SO Laws and other
applicable laws).
Notwithstanding any provision of the Agreement that expressly
or by implication provides to the contrary, (a) it is
expressly agreed and acknowledged that BISYS cannot ensure
that the Trust complies with Applicable AML Laws, the
Applicable Securities Laws or SO Laws, and (b) whenever an
employee or agent of BISYS serves as an Executive Officer of
the Trust, as long as such Executive Officer
16
acts in good faith and in a manner reasonably believed to be
in the best interests of the Trust (and would not otherwise be
liable to the Trust 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 Trust shall
indemnify the Executive Officer and BISYS and hold the
Executive Officer and BISYS harmless from any loss, liability,
expenses (including reasonable attorneys fees) and damages
incurred by them arising out of or resulting to the service of
such Employee/Executive Officer as an Executive Officer of the
Trust.
18. Notices.
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 Trust, to it c/o Victory Capital Management,
Inc., Investment Products Group, 000 Xxxxxx Xxxxxx, Xxxxxxxxx, XX 00000 Attn:
Xxxxxxxx X. Xxxxxx, with a copy to Xxx X. Xxxxx, Esq. Xxxxxx Xxxxx Xxxxxxxx &
Xxxxxxx LLP, 000 Xxxxx Xxxxxx, Xxx Xxxx, XX 00000; and if to BISYS, to it 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.
19. Assignment.
This Agreement and the rights and duties hereunder shall not be assignable
by either of the parties hereto except by the specific written consent of the
other party. This Section 19 shall not limit or in any way affect BISYS' right
to appoint a Sub-Agent pursuant to Section 2 hereof. This Agreement shall be
binding upon, and shall inure to the benefit of, the parties hereto and their
respective successors and permitted assigns.
20. Governing Law.
This Agreement shall be governed by and provisions 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.
21 Activities of Co-Administrators.
The services of the Co-Administrators rendered to the Trust hereunder are
not to be deemed to be exclusive. BISYS is free to render such services to
others and to have other businesses and interests. It is understood that
Trustees, officers, employees and Shareholders of the Trust are or may be or
become interested in BISYS, as officers, employees or otherwise and that
partners, officers and employees of BISYS and its counsel are or may be or
become similarly interested in the Trust, and that BISYS may be or become
interested in the Trust as a Shareholder or otherwise.
17
22. Privacy.
Nonpublic personal financial information relating to consumers or
customers of the Trust provided by, or at the direction of the Trust or Adviser
to BISYS, or collected or retained by BISYS in the course of performing its
duties as Co-Administrator, shall be considered confidential information. BISYS
shall not give, sell or in any way transfer such confidential information to any
person or entity, other than affiliates of BISYS involved in servicing the Funds
except at the direction of the Trust or the Funds or as required or permitted by
law. BISYS represents, warrants and agrees that it has in place and will
maintain physical, electronic and procedural safeguards reasonably designed to
protect the security, confidentiality and integrity of, and to prevent
unauthorized access to or use of records and information relating to consumers
or customers of the Funds. The Trust represents to BISYS that the Trust has
adopted a Statement of its privacy policies and practices as required by the
Commission's Regulation S-P and agrees to provide BISYS with a copy of that
statement annually.
23. Miscellaneous.
(a) Paragraph headings in this Agreement are included for
convenience only and are not to be used to construe or
interpret this Agreement.
(b) This Agreement constitutes the complete agreement of the
parties hereto as to the subject matter covered by this
Agreement, and supercedes all prior negotiations,
understandings and agreements bearing upon the subject matter
covered herein.
(c) 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.
(d) No provision of this Agreement may be changed, waived,
discharged or terminated, except by an instrument in writing
signed by the parties to this Agreement. For special cases,
the parties hereto may amend such procedures set forth herein
as may be appropriate or practical under the circumstances,
and BISYS may conclusively assume that any special procedure
which has been approved by the Trust does not conflict with or
violate any requirements of its Declaration of Trust or
then-current prospectuses, or any rule, regulation or
requirement of any regulatory body. In addition, the Trust
agrees that no amendments will be made to the Prospectuses or
Statement of Additional Information of the Trust, the AML
Program, or the Trust DCPs 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
18
Trust first obtains BISYS's approval of such amendments or
changes, which approval shall not be withheld unreasonably.
(e) It is expressly agreed that the obligations of the Trust
hereunder shall not be binding upon any of the Trustees,
shareholders, nominees, officers, agents or employees of the
Trust personally, but shall bind only the trust property of
the Trust. 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 Trust,
acting as such, and neither such authorization by the Board
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 any of them personally, but shall bind
only the trust property of the Trust as provided in the
Certificate of Trust. =
(f) 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.
(g) The names "The Victory Portfolios" and "Trustees of The
Victory Portfolios" refer respectively to the Trust created
and the Trustees, as trustees but not individually or
personally, acting from time to time under a Certificate of
Trust filed on December 21, 1995 at the office of the
Secretary of State of the State of Delaware which is hereby
referred to and is also on file at the principal office of the
Trust.
(h) Every reference to a Fund will be deemed a reference solely to
the particular Fund (as set forth in Schedule C, as may be
amended from time to time). Under no circumstances shall the
rights, obligations or remedies with respect to a particular
Fund constitute a right, obligation or remedy applicable to
any other Fund. In particular, and without otherwise limiting
the scope of this paragraph, BISYS shall not have any right to
set off claims of a Fund by applying property of any other
Fund.
24. Rights of Ownership.
All computer programs, systems and procedures employed or developed by
BISYS, or on behalf of BISYS by system providers or vendors used by BISYS, to
perform services required to be provided by BISYS under this Agreement are the
property of BISYS. All records and other data maintained hereunder, excepting
such computer programs, systems and procedures, are the exclusive property of
the Trust. All such records and other data which is the property of the Trust
shall be furnished to the
19
Trust in appropriate form as soon as practicable after termination of this
Agreement for any reason.
* * * * *
20
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed all as of the day and year first above written.
THE VICTORY PORTFOLIOS
By: /s/ Xxxxxxxx X Xxxxxx
-------------------------
Name: Xxxxxxxx X. Xxxxxx
Title: President
BISYS FUND SERVICES OHIO, INC.
By: /s/ Xxxx Xxxxxxx
------------------------
Name: Xxxx Xxxxxxx
Title: President
21
SCHEDULE A
TO THE CO-ADMINISTRATION AGREEMENT
BETWEEN THE VICTORY PORTFOLIOS AND BISYS FUND SERVICES OHIO, INC.
CO -ADMINISTRATION SERVICES TO BE PROVIDED BY BISYS
1. Calculate contractual Trust expenses and make and control all
disbursements for the Trust, subject to review and approval of
an officer of the Trust or other authorized person including
administration of trustee and vendor fees and compensation on
behalf of the Trust, and as appropriate.
2. Calculate all capital gain and distribution information
relating to the Funds and its shareholders;
3. Prepare such reports, applications and documents (including
reports regarding the sale and redemption of shares in the
Trust as may be required in order to comply with Federal and
state securities laws) as may be necessary or desirable to
register the shares in the Trust ("Shares") with state
securities authorities, monitor the sale of Shares for
compliance with state securities laws, and file with the
appropriate state securities authorities the registration
statements and reports for the Trust and the Shares and all
amendments thereto, as may be necessary or convenient to
register and keep effective the registration of the Trust and
the Shares with state securities authorities to enable the
Trust to make a continuous offering of its Shares;
4. Prepare drafts of the annual report to Shareholders and
certified semi-annual report for each Fund; prepare and file
the final certified versions thereof on Form N-CSR; prepare
and file the Trust's Form N-SAR; and file all required notices
pursuant to Rule 24f-2;
5. Coordinate with the Trust's transfer agent with respect to the
payment of dividends and other distributions to Shareholders;
6. Calculate performance data of the Funds for dissemination to
information services covering the investment company industry;
7. Prepare and file the Trust's tax returns, including federal,
state, local and excise tax returns, issue all tax-related
information to shareholders, including IRS Form -1099 and
other applicable tax forms;
22
8. Make available appropriate individuals to serve as officers of
the Trust (to serve only in ministerial or administrative
capacities relevant to BISYS's services hereunder, except as
otherwise provided in this Agreement, upon designation as such
by the Board;
9. Assist with the design, development, and operation of the
Funds, including new classes, investment objectives, policies
and structure;
10. Monitor and advise the Trust and its Funds on their regulated
investment company status under the Internal Revenue Code of
1986, as amended. In connection with the foregoing, prepare
and send quarterly reminder letters related to such status,
and prepare quarterly compliance checklist for use by
investment adviser(s) if requested;
11. Assist the Trust in developing portfolio compliance procedures
for each Fund. BISYS will also provide the Board with
quarterly results of compliance reviews;
12. Report to the Board regarding amounts paid under Shareholder
Service Agreements and the nature of Services provided by the
Shareholder Service Agents thereunder; and maintain
appropriate records in connection with the foregoing;
13. Provide assistance and guidance to the Trust with respect to
matters governed by or related to regulatory requirements and
developments including: monitoring regulatory and legislative
developments which may effect the Trust, and assisting in
strategic planning in response thereto. Assistance to be
provided with respect to SEC inspections includes (i)
rendering advice regarding proposed responses (ii) compiling
data and other information in response to SEC requests for
information and (iii) communicating with Fund management and
portfolio managers to provide status updates.
14. Provide appropriate assistance with respect to audits
conducted by the Fund's independent accountants including
compiling data and other information as necessary;
15. Furnish advice and recommendations with respect to other
aspects of the business and affairs of the Funds as the Trust
shall request and the parties shall agree in writing;
16. Prepare quarterly brokerage allocation compliance checklist
and supporting documentation for use by investment adviser(s),
as requested;
23
17. Maintain corporate records on behalf of the Trust, including,
but not limited to, minute books, Declaration of Trust or
Certificate of Incorporation and By-Laws;
18. To assist the Trust in connection with its obligations under
SO Laws, BISYS will internally establish and maintain its own
controls and procedures ("BISYS internal controls") designed
to ensure that information recorded, processed, summarized, or
reported by BISYS on behalf of the Trust and included in
Reports is (a) recorded, processed, summarized, and reported
by BISYS within the time periods specified in the Commission's
rules and forms and the Trust DCPs, and (b) communicated to
the relevant Certifying Officers consistent with the Trust
DCPs.
Solely for the purpose of providing any Certifying Officer
with a basis for certification, BISYS will (i) provide a
sub-certification with respect to BISYS's services during any
fiscal period in which BISYS served as financial administrator
to the Trust consistent with the requirements of the
certification required under SO Laws and/or (ii) inform the
Certifying Officers of any reason why all or part of such
certification would be inaccurate. In rendering any such
sub-certification, BISYS may (a) limit its representations to
information prepared, processed and reported by BISYS; (b)
rely upon and assume the accuracy of the information provided
by officers and other authorized agents of the Trust,
including all Other Providers to the Trust, and compliance by
such officers and agents with the Trust DCPs; and (c) assume
that the Trust has selected the appropriate accounting
policies for the Fund(s).
The Trust shall assist and cooperate with BISYS (and shall
cause its officers, and Other Providers to assist and
cooperate with BISYS) to facilitate the delivery of
information requested by BISYS in connection with the
preparation of the Trust's Form N-CSR, and Form N-Q, including
Trust financial statements, so that BISYS may submit a draft
Report to the Trust's Disclosure Controls and Procedures
Committee ("Fund DCP Committee") prior to the date the
relevant Report is to be filed.
19. File holdings reports on Form N-Q as required at the end of
the first and third fiscal quarters of each year.
20. Notify the Adviser and Fund counsel of all documents filed by
BISYS with the SEC.
21. Obtain, maintain and file fidelity bonds and directors and
officers/errors and omissions insurance policies for the Trust
at the expense of the Trust and Funds in accordance with the
requirements of Rules 17g-1 and 17d-1(7) under the 1940 Act,
to the extent such bonds and policies are approved by the
Board.
24
SCHEDULE B
TO THE CO - ADMINISTRATION AGREEMENT
BETWEEN THE VICTORY PORTFOLIOS AND BISYS FUND SERVICES OHIO, INC.
The Trust shall pay BISYS on the first business day of each month, or at such
time(s) as BISYS shall request and the parties shall agree the following fees
for the services provided under this Agreement at the annual rates set forth
below. For these purposes, the rate at which the asset-based fees are applied is
determined by aggregating the assets of all Funds together. The fees are accrued
daily and paid monthly:
Average daily net assets Annual Fee
First $10 Billion 0.032%
Over $10 Billion 0.025%
Plus
An annual fee of $12,000.00, payable in equal monthly installments, for the
provision of the AML Compliance Officer.
Plus
N-Q filing fees equal to $3,000.00 per Fund per N-Q filed on such Fund's behalf.
25
SCHEDULE C
TO THE CO - ADMINISTRATION AGREEMENT
BETWEEN THE VICTORY PORTFOLIOS AND BISYS FUND SERVICES OHIO, INC.
FUNDS
Victory Balanced Fund
Victory Diversified Stock Fund
Victory Intermediate Income Fund
Victory Ohio Municipal Bond Fund
Victory Prime Obligations Fund
Victory Special Value Fund
Victory Stock Index Fund
Victory Tax-Free Money Market Fund
Victory Value Fund
Victory Financial Reserves Fund
Victory Fund for Income
Victory Institutional Money Market Fund
Victory National Municipal Bond Fund
Victory Ohio Municipal Money Market Fund
Victory Federal Money Market Fund
Victory Convertible Fund
Victory Gradison Government Reserves Fund
Victory Small Company Opportunity Fund
Victory Established Value Fund
Victory Focused Growth Fund
26
