Exhibit 99. - h(iii)
OPERATIONS AGENCY
AGREEMENT
AGREEMENT made as of April 7, 2000 by and between Flag Investors
Portfolios Trust having its principal office and place of business at Cardinal
Avenue, Cayman Islands, BWI (the "Investment Company"), on behalf of the
portfolios (individually referred to herein as a "Fund" and collectively as
"Funds") of the Investment Company, And Investment Company Capital Corp., a
Maryland corporation, having its principal office and place of business at Xxx
Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxx 00000, on behalf of itself and its
subsidiaries (the "Company").
WHEREAS, the Investment Company is registered as an open-end management
investment company under the Investment Company Act of 1940, as amended (the
"1940 Act"), with authorized and issued beneficial interests ("Interest(s)");
WHEREAS, the Fund is a Hub(R)in a Hub(R)and Spoke(R)investment
structure; and
WHEREAS the Investment Company may desire to appoint the Company as its
operations agent to provide it with operations agency services (as herein
defined) and the Company desires to accept such appointment; and
WHEREAS, from time to time the Investment Company may desire and may
instruct the Company to subcontract for the performance of certain of its duties
and responsibilities hereunder to another agent (the "Agent").
NOW THEREFORE, in consideration of the premises and mutual covenants
herein contained, and intending to be legally bound hereby, the parties hereto
agree as follows:
SECTION ONE: Operations Agency Services.
Article 1. Appointment.
The Investment Company hereby appoints the Company as Operations Agent
for the period and on the terms and conditions set forth in this Agreement. The
Company accepts such appointment and agrees to furnish the services set forth in
Article 2 of this Agreement in return for the compensation set forth in Article
6 of this Agreement.
Article 2. The Company's Duties.
As Operations Agent, and subject to the supervision and control of the
Board, and in accordance with Proper Instructions (as defined hereafter) from
the Investment Company the Company will provide facilities, equipment, and
personnel to carry out the following operations agency services for operation of
the business and affairs of the Investment Company and each of its portfolios:
(1) following the organization of the Investment Company, prepare the
Investment Company's governing documents and any amendments thereto,
including the Charter (which has already been prepared and filed), the
By-Laws and minutes of meetings of the Board and Investors;
(2) following the Investment Company's effectiveness with the Securities
and Exchange Commission, prepare and file the registration statements
for the Fund and all amendments thereto, the Form N-SAR, reports to
regulatory authorities and Investors, offering documents, proxy and/or
information statements, and such other documents all as may be
necessary to enable the Investment Company to make a private offering
of its shares;
(3) conduct compliance training sessions for the benefit of the investment
advisers of the Funds;
(4) maintain the Investment Company's calendar of reporting and filing
obligations;
(5) perform internal audit examinations;
(6) monitor and supervise the collection of tax reclaims;
(7) plan and prepare for meetings of the Investment Company's Board,
including maintaining the Board's agenda and preparing and
distributing materials for the Board's review and consideration;
(8) attend in person, and record the minutes of meetings of, the
Investment Company's Board;
(9) consult with the Investment Company and its Board on matters
concerning the Investment Company and its affairs;
(10) prepare materials necessary for shareholder meetings and record the
minutes of shareholder meetings;
(11) prepare expense projections for the Funds;
(12) coordinate the activities of all service providers to the Investment
Company. By way of example, the Company will, in conjunction with item
(4) above, communicate to the other service providers to the
Investment Company lists of information and materials needed for
filing obligations, as well as deadlines for the receipt of such
materials. The Company does not take responsibility for the failure of
other service providers to provide such materials to the Investment
Company in a timely fashion or for the performance of functions for
which other service providers are responsible.
The foregoing, along with any additional services that the Company
shall agree in writing to perform for the Fund under this Section One, shall
hereafter be referred to as "Operations Agency Services."
Article 3. Records.
The Company shall maintain a set of all necessary books and records in
accordance with all applicable laws, rules and regulations, including but not
limited to records required by Section 31(a) of the Investment Company Act of
1940 and the rules thereunder, as the same may be amended from time to time,
pertaining to the Operations Agency Services performed by it and not otherwise
created and maintained by another party pursuant to contract with the Investment
Company. Where applicable, such records shall be maintained by the Company for
the periods and in the places required by Rule 31a-2 under the 1940 Act. The
books and records pertaining to the Investment Company which are in the
possession of the Company shall be the property of the Fund. The Investment
Company, or the Investment Company's authorized representatives, shall have
access to such books and records at all times during the Company `s normal
business hours. Upon the reasonable request of the Investment Company, copies of
any such books and records shall be provided promptly by the Company to the
Investment Company or the Investment Company's authorized representatives.
Article 4. Duties of the Fund.
Except for each responsibility expressly assumed by the Operations
Agent, the Fund assumes full responsibility for the preparation, contents and
distribution of its own offering document and for complying with all applicable
requirements the 1940 Act, the Internal Revenue Code, and any other laws, rules
and regulations of government authorities having jurisdiction.
Article 5. Expenses.
The Company shall be responsible for expenses incurred in providing
office space, equipment, and personnel as may be necessary or convenient to
provide the Operations Agency Services to the Funds. The Fund shall be
responsible for all other reasonable and documented expenses incurred by the
Company on behalf of the Investment Company, including without limitation
postage and courier expenses, printing expenses, travel expenses, registration
fees, filing fees, fees of outside counsel and independent auditors or other
professional services, organizational expenses, insurance premiums, fees payable
to persons who are not the Company employees, trade association dues, and other
expenses properly payable by the Funds and/or Classes.
Article 6. Compensation.
For the Operations Agency Services provided, the Investment Company
hereby agrees to pay and the Company hereby agrees to accept as full
compensation for its services rendered hereunder an operations agency fee at an
annual rate per portfolio of the Investment Company's shares as specified on
Exhibit A.
The compensation and out-of-pocket expenses attributable to the Fund
shall be accrued by the Fund and shall be paid to the Company no less frequently
than monthly, and shall be paid daily upon request of the Company. The Company
will maintain detailed information about the compensation and out-of-pocket
expenses by the Fund.
Article 7. Responsibility of Operations Agent.
A. The Company shall not be liable for any error of judgment or mistake
of law or for any loss suffered by the Investment Company in connection with the
matters to which this Agreement relates, except a loss resulting from willful
misfeasance, bad faith or gross negligence on its part in the performance of its
duties or from reckless disregard by it of its obligations and duties under this
Agreement. The Company shall be entitled to rely on and may act upon advice of
counsel (who may be counsel for the Fund) on all matters, and shall be without
liability for any action reasonably taken or omitted pursuant to such advice.
Any person, even though also an officer, director, trustee, partner, employee or
agent of the Company, who may be or become an officer, director, trustee,
partner, employee or agent of the Investment Company, shall be deemed, when
rendering services to the Investment Company or acting on any business of the
Investment Company (other than services or business in connection with the
duties of the Company hereunder) to be rendering such services to or acting
solely for the Investment Company and not as an officer, director, trustee,
partner, employee or agent or one under the control or direction of the Company
even though paid by the Company.
B. The Company shall be kept indemnified by the Investment Company and
be without liability for any action taken or thing done by it in performing the
Operations Agency Services in accordance with the above standards. In order that
the indemnification provisions contained in this Article 7 shall apply, however,
it is understood that if in any case the Investment Company may be asked to
indemnify or save the Company harmless, the Investment Company shall be fully
and promptly advised of all pertinent facts concerning the situation in
question, and it is further understood that the Company will use all reasonable
care to identify and notify the Investment Company promptly concerning any
situation which presents or appears likely to present the probability of such a
claim for indemnification against the Investment Company. The Investment Company
shall have the right to defend the Company against any claim which may be the
subject of this indemnification. In the event that the Investment Company so
elects, it will so notify the Company and thereupon the Investment Company shall
take over complete defense of the claim, and the Company shall in such situation
initiate no further legal or other expenses for which it shall seek
indemnification under this Article. The Company shall in no case confess any
claim or make any compromise in any case in which the Investment Company will be
asked to indemnify the Company except with the Investment Company's written
consent.
SECTION TWO: General Provisions.
Article 8. Proper Instructions.
As used throughout this Agreement, a "Proper Instruction" means a
writing signed or initialed by one or more person or persons as the Board shall
have from time to time authorized. Each such writing shall set forth the
specific transaction or type of transaction involved. Oral instructions will be
deemed to be Proper Instructions if (a) the Company reasonably believes them to
have been given by a person previously authorized in Proper Instructions to give
such instructions with respect to the transaction involved, and (b) the
Investment Company, or the Fund, and the Company promptly cause such oral
instructions to be confirmed in writing. Proper Instructions may include
communications effected directly between electro-mechanical or electronic
devices provided that the Investment Company, or the Fund, and the Company are
satisfied that such procedures afford adequate safeguards for the Fund's assets.
Proper Instructions may only be amended in writing.
Article 9. Assignment.
Except as provided below, neither this Agreement nor any of the rights
or obligations under this Agreement may be assigned by either party without the
written consent of the other party.
A. This Agreement shall inure to the benefit of and be binding upon the
parties and their respective permitted successors and assigns.
B. With regard to Operations Agency Services, the Company may without
further consent on the part of the Investment Company subcontract for the
performance of such services with Federated Administrative Services, a
wholly-owned subsidiary of the Company.
C. The Company shall upon instruction from the Investment Company
subcontract for the performance of services under this Agreement with an Agent
selected by the Investment Company, other than as described in B. above;
provided, however, that the Company shall in no way be responsible to the
Investment Company for the acts and omissions of the Agent.
Article 10. Documents.
A. In connection with the appointment of the Company under this
Agreement, the Investment Company shall file with the Company the following
documents relating to it:
(1) a copy of its Charter and By-Laws and all amendments thereto;
(2) a copy of the resolution of its Board authorizing this
Agreement;
(3) all documents relating to the Fund or Investor accounts; and
(4) a copy of its current offering document.
B. The Investment Company will also furnish from time to time the
following documents relating to it:
(1) a resolution of its Board authorizing the original offering of
its Interests;
(2) a Registration Statement filed with the SEC and amendments
thereof and orders relating thereto in effect with respect to the sale of its
Interests;
(3) a certified copy of each amendment to the governing document and
the By-Laws of the Investment Company;
(4) certified copies of each vote of the Board authorizing persons
to give Proper Instructions;
(5) such other documents or opinions which the Company may, in its
discretion, deem necessary or appropriate in the proper performance of its
duties; and
(6) revisions to the offering document for each Fund.
Article 11. Representations and Warranties.
A. Representations and Warranties of the Company
The Company represents and warrants to the Fund that:
(1) it is a corporation duly organized and existing and in good
standing under the laws of the State of Maryland;
(2) it is duly qualified to carry on its business in the State of
Maryland;
(3) it is empowered under applicable laws and by its Articles of
Incorporation and By-Laws to enter into and perform this Agreement;
(4) all requisite corporate proceedings have been taken to authorize
it to enter into and perform its obligations under this Agreement;
(5) it has and will continue to have access to the necessary
facilities, equipment and personnel to perform its duties and obligations under
this Agreement;
(6) it is in compliance with federal securities law requirements and
in good standing as an administrator and fund accountant; and
(7) it has obtained all required approvals from all government or
regulatory authorities necessary to enter into this arrangement and to provide
the services contemplated herein.
B. Representations and Warranties of the Investment Company
The Investment Company represents and warrants to the Company that:
(1) it is an investment company duly organized and existing and in
good standing under the laws of its state of organization;
(2) it is empowered under applicable laws and by its Charter and
By-Laws to enter into and perform its obligations under this Agreement;
(3) all corporate proceedings required by said Declaration of Trust
and By-Laws have been taken to authorize it to enter into and perform its
obligations under this Agreement; and
(4) it is an open-end investment company registered under the 1940
Act.
Article 12. Term and Termination of Agreement.
The initial term of this Agreement shall commence on the date hereof,
and extend for a period of three years following the date of the commencement of
the public offering of the Fund's shares. After the initial term of this
Agreement, the Agreement will be terminable on not less than 90 days' notice by
either the Company or the Investment Company subject to the payment of all
deferred expenses and unamortized expenses. In the event, however, of willful
misfeasance, bad faith, negligence or reckless disregard of its duties by the
Company, the Investment Company has the right to terminate the Agreement upon 30
days written notice, if Company has not cured such willful misfeasance, bad
faith, gross negligence or reckless disregard of its duties within that same 30
days. The termination date for all original or after-added Investment companies
which are, or become, a party to this Agreement shall be coterminous. Investment
Companies that merge or dissolve during the Term shall cease to be a party on
the effective date of such merger or dissolution.
Should the Investment Company exercise its right to terminate, all
out-of-pocket expenses associated with the movement of records and materials
will be borne by the Investment Company or the appropriate Fund. Additionally,
the Company reserves the right to charge for any other reasonable expenses
associated with such termination. The provisions of Article 7 shall survive the
termination of this Agreement.
Article 13. Amendment.
No provision of this Agreement may be changed, waived, discharged or
terminated orally, but only by a written agreement executed by both parties.
Article 14. Interpretive and Additional Provisions.
In connection with the operation of this Agreement, the Company and the
Investment Company may from time to time agree on such provisions interpretive
of or in addition to the provisions of this Agreement as may in their joint
opinion be consistent with the general tenor of this Agreement. Any such
interpretive or additional provisions shall be in a writing signed by all
parties and shall be annexed hereto, provided that no such interpretive or
additional provisions shall contravene any applicable federal regulations or any
provision of the organizational documents. No interpretive or additional
provisions made as provided in the preceding sentence shall be deemed to be an
amendment of this Agreement.
Article 15. Governing Law.
This Agreement shall be construed and the provisions hereof interpreted
under and in accordance with the laws of the State of New York.
Article 16. Notices.
Except as otherwise specifically provided herein, notices and other
writings delivered or mailed postage prepaid to the Investment Company at
Cardinal Avenue, Grand Cayman, Cayman Islands, BWI with a copy to Deutsche Fund
Management, Inc. at Xxx Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxx 00000, Attn:
President; or to the Company at Xxx Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxx 00000,
Attn: President, or to such other address as the Investment Company or the
Company may hereafter specify, shall be deemed to have been properly delivered
or given hereunder to the respective address.
Article 17. Counterparts.
This Agreement may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original.
Article 18. Successor Agent.
If a successor agent shall be appointed by the Investment Company, the
Company shall upon termination of this Agreement deliver to such successor agent
at the office of the Company all properties of the Fund held by it hereunder. If
no such successor agent shall be appointed, the Company shall at its office upon
receipt of Proper Instructions deliver such properties in accordance with such
instructions.
With regard to Section One, in the event that no written order
designating a successor agent or Proper Instructions shall have been delivered
to the Company on or before the date when such termination shall become
effective, then the Company shall have the right to deliver to a bank or trust
company, which is a "bank" as defined in the 1940 Act, of its own selection,
having an aggregate capital, surplus, and undivided profits, as shown by its
last published report, of not less than $2,000,000, all properties held by the
Company under this Agreement. Thereafter, such bank or trust company shall be
the successor of the Company under this Agreement.
Article 19. Force Majeure.
The Company shall have no liability for cessation of services hereunder
or any damages resulting therefrom to the Investment Company or the Fund as a
result of work stoppage, natural disaster, governmental action, loss or
malfunction of utilities or other impossibility of performance.
Article 20. Assignment; Successors.
Either party may assign all of or a substantial portion of its business
to a party controlling, controlled by, or under common control with such party.
Nothing in this Article 21 shall prevent the Company from delegating its
responsibilities to another entity to the extent provided herein.
Article 21. Severability.
In the event any provision of this Agreement or any interpretive or
additional provision described in Article 15 are held illegal, void or
unenforceable, the balance shall remain in effect.
Article 22. Limitations of Liability of Trustees and Investors of the
Investment Company.
The execution and delivery of this Agreement have been authorized by
the Trustees of Investment Company and signed by an authorized officer of the
Investment Company, acting as such, and neither such authorization by such
Trustees 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, and the obligations of this Agreement are not binding upon the
Trustees, the Fund or Investors, but bind only the appropriate property of the
Investment Company, as provided in the Declaration of Trust.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in their names and on their behalf under their seals by and through
their duly authorized officers, as of the day and year first above written.
FLAG INVESTORS PORTFOLIOS TRUST
By: /s/ Xxx X. XXxxxx
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Name: Xxx X. Xxxxxx
Title: Secretary
INVESTMENT COMPANY CAPITAL CORP.
By: /s/ Xxxxxxx X. Xxxx
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Name: Xxxxxxx X.Xxxx
Title: President
