ADMINISTRATION AGREEMENT
Agreement dated as of March 25, 1997 by and between State Street Bank
and Trust Company, a Massachusetts trust company (the "Administrator"), and
Providian Series Trust (the "Fund").
WHEREAS, the Fund is registered as an open-end, management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act");
and
WHEREAS, the Fund desires to retain the Administrator to furnish
certain administrative services to the Fund, and the Administrator is willing to
furnish such services, on the terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, the parties hereto agree as follows:
1. Appointment of Administrator
The Fund hereby appoints the Administrator to act as administrator
with respect to the Fund for purposes of providing certain administrative
services for the period and on the terms set forth in this Agreement. The
Administrator accepts such appointment and agrees to render the services stated
herein.
The Fund will initially consist of the portfolio(s) and/or class(es)
of shares (each an "Investment Fund") listed in Schedule A to this Agreement and
incorporated herein by reference. In the event that the Fund establishes one or
more additional Investment Funds with respect to which it wishes to retain the
Administrator to act as administrator hereunder, the Fund shall notify the
Administrator in writing. Upon written acceptance by the Administrator, such
Investment Fund shall become subject to the provisions of this Agreement to the
same extent as the existing Investment Funds, except to the extent that such
provisions (including those relating to the compensation and expenses payable by
the Fund and its Investment Funds) may be modified with respect to each
additional Investment Fund in writing by the Fund and the Administrator at the
time of the addition of the Investment Fund.
2. Delivery of Documents
The Fund will promptly deliver to the Administrator copies of each of
the following documents and all future amendments and supplements, if any:
a. The Fund's charter document and by-laws;
b. The Fund's currently effective registration statement under the
Securities Act of 1933, as amended (the "1933 Act"), and the 1940
Act and the Fund's Prospectus(es) and Statement(s) of Additional
Information relating to all Investment Funds and all amendments
and supplements thereto as in effect from time to time;
c. Certified copies of the resolutions of the Board of Trustees of
the Fund (the "Board") authorizing (1) the Fund to enter into
this Agreement and (2) certain individuals on behalf of the Fund
to (a) give instructions to the Administrator pursuant to this
Agreement and (b) sign checks and pay expenses;
d. A copy of the investment advisory agreement between the Fund and
its investment adviser and copies of any investment subadvisory
agreements between the Fund's adviser and any subadvisers;
e. A copy of the participation agreement(s) between the Fund and the
insurance company separate account(s) investing in the Fund; and
f. Such other certificates, documents or opinions which the
Administrator may, in its reasonable discretion, deem necessary
or appropriate in the proper performance of its duties.
3. Representation and Warranties of the Administrator
The Administrator represents and warrants to the Fund that:
a. It is a Massachusetts trust company, duly organized, existing and
in good standing under the laws of The Commonwealth of
Massachusetts;
b. It has the corporate power and authority to carry on its business
in The Commonwealth of Massachusetts;
c. All requisite corporate proceedings have been taken to authorize
it to enter into and perform this Agreement;
d. No legal or administrative proceedings have been instituted or
threatened which would impair the Administrator's ability to
perform its duties and obligations under this Agreement; and
e. Its entrance into this Agreement shall not cause a material
breach or be in material conflict with any other agreement or
obligation of the Administrator or any law or regulation
applicable to it.
4. Representations and Warranties of the Fund
The Fund represents and warrants to the Administrator that:
a. It is a business trust, duly organized and existing and in good
standing under the laws of The Commonwealth of Massachusetts;
b. It has the corporate power and authority under applicable laws
and by its charter and by-laws to enter into and perform this
Agreement;
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c. All requisite proceedings have been taken to authorize it to
enter into and perform this Agreement;
d. It is an investment company properly registered under the 1940
Act;
e. A registration statement under the 1933 Act and the 1940 Act has
been filed and will be effective. The Fund also warrants to the
Administrator that all necessary filings under the securities
laws of the states in which the Fund offers or sells its shares
will have been made and will be current during the term of this
Agreement;
f. All shareholders of the Fund will be "qualified investors" as
that term is defined under Regulation 1.817-5(f)(3) of the
Internal Revenue Code of 1986, as amended ("IRC");
g. No legal or administrative proceedings have been instituted or
threatened which would impair the Fund's ability to perform its
duties and obligations under this Agreement;
h. Its entrance into this Agreement shall not cause a material
breach or be in material conflict with any other agreement or
obligation of the Fund or any law or regulation applicable to it;
and
i. As of the close of business on the date of this Agreement, the
Fund is authorized to issue an unlimited amount of shares of
beneficial interest.
5. Administration Services
The Administrator shall provide the following services, in each case,
subject to the control, supervision and direction of the Fund and the review and
comment by the Fund's auditors and legal counsel and in accordance with
procedures which may be established from time to time between the Fund and the
Administrator:
a. Oversee the determination and publication of the Fund's net asset
value in accordance with the Fund's policy as adopted from time
to time by the Board and as may be set forth in the Fund's
prospectus and statement of additional information;
b. Oversee the maintenance by the Fund's custodian of certain books
and records of the Fund as required under Rule 31a-1(b) of the
1940 Act;
c. Prepare for review by the Fund's independent accountants and
filing by the Fund's treasurer: the Fund's Federal tax return on
Form 1120-RIC and related schedules; the Fund's state and local
income tax returns and franchise tax returns, where applicable;
and the Fund's Federal excise tax return on Form 8613;
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d. Prepare and file U.S. Treasury Form 1099 MISC;
e. Consult with the Fund's Treasurer regarding tax policies;
f. Coordinate all communications and data collection with regard to
annual audits by Fund's independent accountants.
g. Prepare Fund's annual budget; analyze expenses and accruals; and
review calculation of, submit for approval by Fund's officers and
arrange for payment of the Fund's expenses;
h. Prepare for review and approval by officers of the Fund financial
information for the Fund's semi-annual and annual reports, proxy
statements and other communications required or otherwise to be
sent to Fund shareholders, and arrange for the printing and
dissemination of such reports and communications to shareholders;
i. Prepare for review by an officer of and legal counsel for the
Fund the Fund's periodic financial reports required to be filed
with the Securities and Exchange Commission ("SEC") on Form N-SAR
and financial information required by Form N-1A and such other
reports, forms or filings as may be mutually agreed upon;
j. Prepare reports relating to the business and affairs of the Fund
as may be mutually agreed upon and not otherwise prepared by the
Fund's investment adviser, custodian, legal counsel or independent
accountants;
k. Make such reports and recommendations to the Board concerning the
performance of the independent accountants as the Board may
reasonably request;
l. Make such reports and recommendations to the Board concerning the
performance and fees of the Fund's custodian and transfer and
dividend disbursing agent ("Transfer Agent") as the Board may
reasonably request or deems appropriate;
m. Oversee and review calculations of fees paid to the Fund's
investment adviser, subadvisers, custodian and Transfer Agent;
n. Consult with the Fund's officers, independent accountant, legal
counsel, custodian and Transfer Agent in establishing the
accounting policies of the Fund;
o. Review implementation of any dividend reinvestment programs
authorized by the Board;
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p. Respond to, or refer to the Fund's officers or Transfer Agent,
shareholder inquiries relating to the Fund;
q. Monitor investment and fund operating compliance and provide
summary reports to assist the Fund's investment adviser in
ensuring compliance with: appropriate GAAP/Tax treatment; IRC
Section 851 mandatory requirements for qualification as a
regulated investment company (i.e., asset diversification tests,
qualifying income tests, 50% foreign securities test, if
applicable and 50% tax-exempt tests, if applicable); 1940 Act
requirements including asset diversification tests, collateral
requirements and if applicable, Rule 2a-7 requirements; and
certain Fund prospectus investment limitations, as may be mutually
agreed upon;
r. Compute and recommend distribution amount necessary to satisfy the
requirements of IRC Section 852 and 4982;
s. Prepare such management reports and Board of Trustees materials as
may be mutually agreed upon (e.g., unaudited financial statements,
portfolio holdings expense ratio analysis, distribution summaries
and if applicable, xxxx-to market reporting);
t. Review and provide assistance on shareholder communications;
u. Maintain general corporate calendar;
v. Maintain copies of the Fund's charter and by-laws;
w. File annual and simi-annual shareholder reports with the
appropriate regulatory agencies; review text of "President's
letters" to shareholders and "Management's Discussion of Fund
Performance" (which shall also be subject to review by the Fund's
legal counsel);
x. Organize, attend and prepare minutes of shareholder meetings;
y. Provide consultation on regulatory matters relating to portfolio
management, Fund operations and any potential changes in the
Fund's investment policies, operations or structure; act as
liaison to legal counsel to the Fund and, where applicable, to
legal counsel to the Fund's independent Board members;
z. Maintain continuing awareness of significant emerging regulatory
and legislative developments which may affect the Fund, update
the Board and the investment adviser on those developments and
provide related planning assistance where requested or
appropriate;
aa. Develop or assist in developing guidelines and procedures to
improve overall compliance by the Fund and its various agents;
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bb. Counsel and assist the Fund in the handling of routine regulatory
examinations and work closely with Fund's legal counsel in
response to any non-routine regulatory matters;
Subject to review and comment by the Fund's legal counsel:
cc. Prepare and file with the SEC amendments to the Fund's
registration statement, including updating the Prospectus and
Statement of Additional Information, where applicable;
dd. Prepare and file with the SEC proxy statements; provide
consultation on proxy solicitation matters;
ee. Prepare agenda and background materials for Board meetings,
attend Board meetings, prepare minutes and follow-up on matters
raised at Board meetings; and
ff. Prepare and file with the SEC Rule 24f-2 notices, and
gg. Assist in the evaluation and obtaining of fidelity bond and
trustees and officers errors and omissions liability insurance
coverage.
The Administrator shall provide the office facilities and the personnel required
by it to perform the services contemplated herein.
6. Fees; Expenses; Expense Reimbursement
The Administrator shall receive from the Fund such compensation for
the Administrator's services provided pursuant to this Agreement as may be
agreed to from time to time in a written fee schedule approved by the parties
and initially set forth in Schedule B to this Agreement. The fees are accrued
daily and billed monthly and shall be due and payable within 45 days of receipt
of the invoice. Upon the termination of this Agreement before the end of any
month, the fee for the part of the month before such termination shall be
prorated according to the proportion which such part bears to the full monthly
period and shall be payable upon the date of termination of this Agreement. In
addition, the Fund shall reimburse the Administrator for its out-of-pocket costs
incurred in connection with this Agreement.
The Fund agrees promptly to reimburse the Administrator for any
equipment and supplies specially ordered by or for the Fund through the
Administrator and for any other expenses not contemplated by this Agreement that
the Administrator may incur on the Fund's behalf at the Fund's request or with
the Fund's consent.
The Fund will bear all expenses that are incurred in its operation and
not specifically assumed by the Administrator. Expenses to be borne by the
Fund, include, but are not limited to: organizational expenses; cost of
services of independent accountants and outside legal and tax counsel engaged by
the Fund (including such counsel's review of the Fund's registration statement,
proxy materials, federal and state tax qualification as a regulated investment
company and other reports and
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materials prepared by the Administrator under this Agreement); cost of any
services contracted for by the Fund directly from parties other than the
Administrator; cost of trading operations and brokerage fees, commissions and
transfer taxes in connection with the purchase and sale of securities for the
Fund; investment advisory fees; taxes, insurance premiums and other fees and
expenses applicable to its operation; costs incidental to any meetings of
shareholders including, but not limited to, legal and accounting fees, proxy
filing fees and the costs of preparation (excluding preparation by the
Administrator as provided in Section 5y, above but including cost of preparation
for filing by XXXXX), printing and mailing of any proxy materials; costs
incidental to Board meetings, including fees and expenses of Board members; the
salary and expenses of any officer, trustee or employee of the Fund; costs
incidental to the preparation (excluding preparation by the Administrator of
financial information as provided in Section 5e above), printing and
distribution of the Fund's shareholder reports; cost of typesetting and printing
of prospectuses; cost of preparation (except as provided in Sections 5c and 5y,
above) and filing of the Fund's tax returns, and Form N-SAR, and cost of
preparation (excluding preparation by the Administrator as provided in Section
5f, above but including cost of preparation for filing by XXXXX) and filing of
Form N-1A, and all notices, registrations and amendments associated with
applicable federal and state tax and securities laws; all applicable
registration fees and filing fees required under federal and state securities
laws; fidelity bond and directors' and officers' liability insurance; and cost
of independent pricing services used in computing the Fund's net asset value.
The Administrator is authorized to retain the services of service providers
as the Administrator may deem desirable to assist it in performing its duties
under this Agreement; provided, however, that the compensation of such person or
persons shall be paid by the Administrator and that the Administrator shall be
as fully responsible to the Fund for the acts and omissions of any such service
providers as it is for its own acts and omissions; and further provided that the
Administrator shall notify the Fund of the retention of such service providers.
7. Instructions and Advice
With respect to any matter arising in connection with the services to
be performed by the Administrator under this Agreement, the Administrator at any
time: (i) may apply to any officer of the Fund for instructions; (ii) with the
Fund's consent and at the Fund's expense, may consult with counsel (which may be
counsel for the Fund or counsel approved by the Fund) or with the independent
accountants for the Fund; or (iii) at its own expense, may consult with counsel
of its own choosing. The Administrator shall not be liable, and shall be
indemnified by the Fund, for any action taken or omitted by it in good faith in
reliance upon any such instructions or advice or upon any paper or document
received in accordance with the terms of this Agreement and believed by the
Administrator to be genuine and to have been signed by the proper person or
persons. The Administrator shall not be held to have notice of any change of
authority of any person until receipt of written notice thereof from the Fund.
Nothing in this paragraph shall be construed as imposing upon the Administrator
any obligation to seek such instructions or advice, or to act in accordance with
such advice when received.
8. Limitation of Liability and Indemnification
The Administrator shall be responsible for the performance of only
such duties as are set forth in this Agreement and, except as otherwise provided
under Section 6, shall have no responsibility for the actions or activities of
any other party, including other service providers. The Administrator shall
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have no liability for any error of judgement or mistake of law or for any loss
or damage resulting from the performance or nonperformance of its duties
hereunder unless caused by or resulting from the negligence or willful
misconduct of the Administrator, its officers or employees. The Administrator
shall not be liable for any special, indirect, incidental, or consequential
damages of any kind whatsoever (including, without limitation, attorneys' fees)
under any provision of this Agreement or for any such damages arising out of any
act or failure to act hereunder. In any event, the Administrator's liability
under this Agreement shall be limited to the greater of its total annual
compensation earned and fees paid hereunder during the preceding two years or
$500,000 for any liability or loss suffered by the Fund including, but not
limited to, any liability relating to qualification of the Fund as a regulated
investment company or any liability relating to the Fund's compliance with any
federal or state tax or securities statute, regulation or ruling.
The Administrator shall not be responsible or liable for any failure
or delay in performance of its obligations under this Agreement arising out of
or caused, directly or indirectly, by circumstances beyond its control,
including without limitation, work stoppage, power or other mechanical failure,
computer virus, natural disaster, governmental action or communication
disruption.
The Fund shall indemnify and hold the Administrator harmless from all
loss, cost, damage and expense, including reasonable fees and expenses for
counsel, incurred by the Administrator resulting from any claim, demand, action
or suit in connection with the Administrator's acceptance of this Agreement, the
performance of its duties hereunder, or as a result of acting upon any
instructions reasonably believed by it to have been duly authorized by the Fund,
provided that this indemnification shall not apply to any losses, costs, damages
and expenses, including reasonable fees and expenses for counsel, arising out of
or resulting from the Administrator's negligence or willful misconduct.
The Fund will be entitled to participate at its own expense in the
defense, or, if it so elects, to assume the defense of any suit brought to
enforce any liability subject to the indemnification provided above. In the
event the Fund elects to assume the defense of any such suit and retain counsel,
the Administrator or any of its affiliated persons, named as defendant or
defendants in the suit, may retain additional counsel but shall bear the fees
and expenses of such counsel unless (i) the Fund shall have specifically
authorized the retaining of such counsel or (ii) the Administrator shall have
determined in good faith that the retention of such counsel is required as a
result of a conflict of interest.
The indemnification contained herein shall survive the termination of
this Agreement.
9. Confidentiality
The Administrator agrees that, except as otherwise required by law or
in connection with any required disclosure to a banking or other regulatory
authority, it will keep confidential all records and information in its
possession relating to the Fund or its shareholders or shareholder accounts and
will not disclose the same to any person except at the request or with the
written consent of the Fund. This obligation shall survive the termination of
this Agreement with respect to any non-public information received by the
Administrator during the period that the Agreement was in effect.
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10. Compliance with Governmental Rules and Regulations; Records
Without derogating the responsibilities of the Administrator under
this Agreement, the Fund assumes full responsibility for complying with all
securities, tax, commodities and other laws, rules and regulations applicable to
it.
In compliance with the requirements of Rule 31a-3 under the 1940 Act,
the Administrator agrees that all records which it maintains for the Fund shall
at all times remain the property of the Fund, shall be readily accessible during
normal business hours, and shall be promptly surrendered upon the termination of
the Agreement or otherwise on written request. The Administrator further agrees
that all records which it maintains for the Fund pursuant to Rule 31a-1 under
the 1940 Act will be preserved for the periods prescribed by Rule 31a-2 under
the 1940 Act unless any such records are earlier surrendered as provided above.
Records shall be surrendered in usable machine-readable form.
11. Services Not Exclusive
The services of the Administrator to the Fund are not to be deemed
exclusive, and the Administrator shall be free to render similar services to
others. The Administrator shall be deemed to be an independent contractor and
shall, unless otherwise expressly provided herein or authorized by the Fund from
time to time, have no authority to act or represent the Fund in any way or
otherwise be deemed an agent of the Fund.
12. Term, Termination and Amendment
(a) This Agreement shall become effective on the date the Fund first
accepts money for investment.
(b) Either party may terminate this Agreement: (1) at any time by
prior written notice to the other party given not less than ninety days prior to
the date upon which such termination will take effect; (2) for cause on not less
than thirty days' prior written notice to the defaulting party, unless the
defaulting party has cured such cause within thirty days of receiving such
notice, for any material breach by the defaulting party of any representation,
warranty, covenant or obligation hereunder; or (3) immediately by written notice
to the other party if such party reasonably determines that such other party has
suffered a material adverse change in its business, operations or financial
condition.
(c) Notwithstanding any other provision of this Agreement, upon
termination by the Fund of this Agreement prior to two years from the effective
date of this Agreement, the Fund shall pay to the Administrator an amount equal
to any fees waived by the Administrator under this Agreement unless: (1) such
termination was for cause for a material breach by the Administrator as provided
above in Section 12(b)(2); or (2) such termination was based on a pattern of
non-material defaults caused solely by the Administrator, such as calculation
errors, untimeliness of reports or inaccuracies in reports (any one of which
could be a material default depending on the impact to the Fund), which defaults
the Administrator upon written notice by the Fund was unable or unwilling to
cure within sixty days of receiving such notice and the occurrence of such
defaults caused the Fund in good faith reasonably to believe that the
Administrator was unable to satisfactorily perform its obligations under this
Agreement.
(d) Termination of this Agreement with respect to any given
Investment Fund shall in no way affect the continued validity of this Agreement
with respect to any other Investment Fund.
(e) Upon termination of this Agreement, the Fund shall pay to the
Administrator such compensation and any reimbursable expenses as may be due
under the terms hereof as of the date of such termination, including reasonable
out-of-pocket expenses associated with such termination.
(f) This Agreement may be modified or amended from time to time by
mutual written agreement of the parties.
13. Notices
Any notice or other communication authorized or required by this
Agreement to be given to either party shall be in writing and deemed to have
been given when delivered in person or by confirmed facsimile, or posted by
certified mail, return receipt requested, to the following address (or such
other address as a party may specify by written notice to the other): if to the
Fund: Providian Series Trust, 000 Xxxx Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx
00000, Attn: President, fax: (000) 000-0000; if to the Administrator: State
Street Bank and Trust Company, 0000 Xxxxxxxx Xxxxx, Xxxxx Xxxxxx, Xxxxxxxxxxxxx
00000, Attn: Xxxxxx Xxxxx Xxxxx, Vice President and Counsel, fax: (617) 985-
2497.
14. Non-Assignability
This Agreement shall not be assigned by either party hereto without
the prior consent in writing of the other party, except that the Administrator
may assign this Agreement to a successor of all or a substantial portion of its
business, which is a party controlling, controlled by or under common control
with the Administrator.
15. Successors
This Agreement shall be binding on and shall inure to the benefit of
the Fund and the Administrator and their respective successors and permitted
assigns.
16. Entire Agreement
This Agreement contains the entire understanding between the parties
hereto with respect to the subject matter hereof and supersedes all previous
representations, warranties or commitments regarding the services to be
performed hereunder whether oral or in writing.
17. Waiver
The failure of a party to insist upon strict adherence to any term of
this Agreement on any occasion shall not be considered a waiver nor shall it
deprive such party of the right thereafter to insist upon strict adherence to
that term or any term of this Agreement. Any waiver must be in writing signed by
the waiving party.
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18. Severability
If any provision of this Agreement is invalid or unenforceable, the
balance of the Agreement shall remain in effect, and if any provision is
inapplicable to any person or circumstance it shall nevertheless remain
applicable to all other persons and circumstances.
19. Governing Law
This Agreement shall be construed and the provisions thereof
interpreted under and in accordance with the laws of The Commonwealth of
Massachusetts.
20. Reproduction of Documents
This Agreement and all schedules, exhibits, attachments and amendments
hereto may be reproduced by any photographic, photostatic, microfilm, micro-
card, miniature photographic or other similar process. The parties hereto each
agree that any such reproduction shall be admissible in evidence as the original
itself in any judicial or administrative proceeding, whether or not the original
is in existence and whether or not such reproduction was made by a party in the
regular course of business, and that any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in evidence.
21. LIMITATION OF LIABILITY
Notice is hereby given that a copy of the Fund's Declaration of Trust
and all amendments thereto is on file with The Commonwealth of Massachusetts,
that this Agreement has been executed on behalf of the Fund by the undersigned
duly authorized representative of the Fund in his/her capacity as such and not
individually, and that the obligations of this Agreement shall only be binding
upon the assets and property of the Fund and shall not be binding upon any
trustee, officer or shareholder of the Fund individually.
22. MULTIPLE PORTFOLIOS
Each Investment Fund shall be regarded for all purposes hereunder as a
separate party apart from each other Investment Fund. Unless the context
otherwise requires, with respect to every transaction covered by this Agreement,
every reference herein to the Fund shall be deemed to relate solely to the
particular Investment Fund to which such transaction relates. Under no
circumstances shall the rights, obligations or remedies with respect to a
particular Investment Fund constitute a right, obligation or remedy applicable
to any other Investment Fund. The use of this single document to memorialize
the separate agreement of each Investment Fund is understood to be for clerical
convenience only and shall not constitute any basis for joining the Investment
Funds for any reason.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their officers designated below as of the date first written above.
PROVIDIAN SERIES TRUST
By: /s/ Xxxx X. Xxxxxxx
-------------------------------
Name: Xxxx X. Xxxxxxx
-----------------------------
Title: President
----------------------------
STATE STREET BANK AND TRUST COMPANY
By: /s/ Xxxxxx X. Xxxxx
-------------------------------
Name: Xxxxxx X. Xxxxx
-----------------------------
Title: Executive Vice President
----------------------------
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ADMINISTRATION AGREEMENT
PROVIDIAN SERIES TRUST
SCHEDULE A
Listing of Investment Funds
High Quality Stock Fund
Fixed Income Fund
International Active Fund
Money Market Fund
Capital Preservation Portfolio
Income Oriented Portfolio
Growth and Income Portfolio
Capital Growth Portfolio
Maximum Appreciation Portfolio
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ADMINISTRATION AGREEMENT
PROVIDIAN SERIES TRUST
SCHEDULE B
Fees and Expenses
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