SHAREHOLDER SERVICING AGREEMENT
The Victory Portfolios
0000 Xxxxxxx Xxxx, Xxxxx 0000
Xxxxxxxx, Xxxx 00000-0000
To:
In this Agreement, "we" and "us" refer to The Victory Portfolios (the
Trust"). We are entering this Service Agreement on behalf of our various series
funds (the "Funds") and their classes that have adopted "Shareholder Servicing
Plans", as described in the Funds' current Registration Statement, as amended
from time to time. "You" refers to the service provider that has signed this
Agreement. This Agreement concerns support services that you provide to your
clients ("Clients") who may from time to time beneficially own shares of the
Funds.
The terms and conditions of this Servicing Agreement are as follows:
Section 1. You agree to provide administrative and support services to your
Clients who may from time to time beneficially own shares, which may include the
following support services: (i) establishing and maintaining accounts and
records relating to Clients that invest in Shares; (ii) processing dividend and
distribution payments from us on behalf of Clients; (iii) providing information
periodically to Clients showing their positions in Shares and integrating such
statements with those of other transactions and balances in Clients' other
accounts serviced by you; (iv) arranging for bank wires; (v) responding to
Client inquiries relating to the services performed by you; (vi) responding to
routine inquires from Clients concerning their investments in Shares; (vii)
providing subaccounting with respect to Shares beneficially owned by Clients, or
the information to us necessary for subaccounting; (viii) if required by law,
forwarding shareholder communications from us (such as proxies, shareholder
reports, annual and semi-annual financial statements and dividend, distribution
and tax notices) to Clients; (ix) assisting in processing purchase, exchange and
redemption requests from Clients and in placing such orders with our service
contractors; (x) assisting Clients in changing dividend options, account
designations and addresses; (xi) providing Clients with a service that invests
the assets of their accounts in Shares pursuant to specific or pre-authorized
instructions; and (xii) providing such other similar services as we may
reasonably request to the extent you are permitted to do so under applicable
statutes, rules and regulations.
Section 2. You will provide such office space and equipment, telephone
facilities and personnel (which may be any part of the space, equipment and
facilities currently used in your business, or any personnel employed by you) as
may be reasonably necessary or beneficial in order to provide the aforementioned
services and assistance to Clients.
Section 3. Neither you nor any of your officers, employees or agents are
authorized to make any representations concerning us or the Shares except those
contained in our then current prospectuses and statement of additional
information, copies of which will be supplied by us to you, or in such
supplemental literature or advertising as may be authorized by us in writing.
Section 4. For all purposes of this Agreement you will be deemed to be an
independent contractor, and will have no authority to act as agent for us in any
matter or in any respect. By your written acceptance of this Agreement, you
agree to and do release, indemnify and hold us, our principal underwriter,
investment adviser, administrator, sub-administrator, transfer agent and our and
their respective officers, directors or trustees, agents, employees and
affiliates harmless from and against any and all direct or indirect liabilities
or losses resulting from (i) any requests, directions, actions, or inactions of
or by you or your officers, employees or agents regarding your responsibilities
hereunder or the purchase, redemption, transfer or registration of Shares (or
orders relating to the same) by or on behalf of Clients, or (ii) any breach of
this Agreement, including any warranty, representation or undertaking contained
in this Agreement. You and your employees will, upon request, be available
during normal business hours to consult with us or our designees concerning the
performance of your responsibilities under this Agreement.
Section 5. In consideration of the services and facilities provided by you
hereunder, we will pay to you, and you will accept as full payment therefor, a
fee at the annual rate of 25 one-hundredths of one percent (.25%) of the average
daily net asset value of the Shares beneficially owned by your Clients for whom
you are the dealer of record or holder of record or with whom you have a
servicing relationship (the "Client's Shares"). We will compute this fee daily
and payable monthly. For purposes of determining the fees payable under this
Section 5, we will compute the average daily net asset value of the Clients'
Shares in the manner specified in our current Registration Statement (as amended
from time to time) in connection with the computation of the net asset value of
Shares for purposes of purchases and redemptions. By your written acceptance of
this Agreement, you agree to and do waive such portion of any fee payable to you
hereunder to the extent necessary to assure that such fee and other expenses
required to be accrued by us on any day with respect to the Clients' Share in
any Fund that declares its net investment income as a dividend to shareholders
on a daily basis does not exceed the income to be accrued by us to such Shares
on that day. In our sole discretion, we may prospectively increase or decrease
this fee at any time upon notice to you. Further, in our discretion and without
notice to you, we may suspend or withdraw the sale of Shares, including the sale
of Shares to you for the account of any Client or Clients.
Section 6. Any person authorized to direct the disposition of monies paid or
payable by us pursuant to this Agreement will provide to our Board of Trustees,
and our trustees will review, at least quarterly, a written report of the
amounts so expended and the purposes for which such expenditures were made. In
addition, you will furnish us or our designees with such information as we or
they may reasonably request (including, without limitation, periodic
certifications confirming the provision to Clients of the services described
herein), and will otherwise cooperate with us and our designees (including,
without limitation, any auditors designated by us or any regulators), in
connection with the
preparation of reports to our Board of Trustees concerning this Agreement and
the monies paid or payable by us pursuant hereto, as well as any other reports
or filings that may be required by law.
Section 7. We may enter into other similar Servicing Agreements with any
other person or persons without your consent.
Section 8. By your written acceptance of this Agreement, you represent,
warrant and agree that: (i) to the extent required by law, you will disclose to
your Clients the compensation payable to you in connection with the investment
of your Clients' assets in Shares; (ii) the services that you provide under this
Agreement will not be primarily intended to result in the sale of Shares; (iii)
your receipt of fees under this Agreement will not constitute a "prohibited
transaction" as defined in the Employee Retirement Income Security Act of 1974,
as amended; (iv) your receipt of fees under this Agreement does not materially
violate any law or regulation that you are subject to; (v) you will be
responsible for compliance with all applicable laws, rules and regulations
governing your performance of services under this Agreement, including but not
limited to Regulation S-P or other laws governing privacy of confidential
consumer information; (vi) to the extent required by law, you will adopt and
maintain (A) an anti-money laundering program, (B) customer identification
program, (C) procedures for detecting and reporting suspicious activities that
could give rise to money laundering, and (D) procedures for notifying us of any
activity that would reasonably raise concerns about the existence of money
laundering or unlawful activity.
Section 9. This Agreement will become effective on the date that we or our
designee receives a fully executed copy of this Agreement. Unless sooner
terminated, this Agreement will continue automatically for successive annual
periods, provided that we approve the continuation of this Agreement at least
annually in the manner described in Section 12. You or we may terminate this
Agreement upon 60 days' written notice to the other party at any time and
without penalty.
Section 10. All notices and other communications to either you or us will be
duly given if mailed, telegraphed, telexed or transmitted by similar
telecommunication device to the appropriate address stated herein, or to such
other address as either party shall so provide the other.
Section 11. This Agreement will be construed in accordance with the laws of
the State of Ohio and is non-assignable by the parties hereto.
Section 12. This Agreement has been approved by vote of a majority of (i) our
Board of Trustees and (ii) those Trustees who are not "interested persons" (as
defined in the Investment Company Act of 1940) of us and have no direct or
indirect financial interest in this Agreement ("Disinterested Trustees"), cast
in person at a meeting called for the purpose of voting on such approval.
Section 13. The names "The Victory Portfolios" and the "Board of Trustees"
refer respectively to the Trust created and the Trustees, as trustees but not
individually or personally, acting from time to time under a Trust Instrument as
amended from time to time. The obligations of "The Victory Portfolios" entered
into in the name or on behalf thereof by any of the Trustees, representatives or
agents are made not individually but in such capacities, and are not binding
upon any of the Trustees personally, but bind only the assets of the Trust. No
shareholder of the Trust shall be personally liable for the debts, liabilities,
obligations and expenses incurred by, contracted for, or otherwise existing with
respect to, the Trust or by or on behalf of any Fund. The Trustees have no power
to bind any shareholder personally or to call upon any shareholder for the
payment of any sum of money or assessment whatsoever other than such as the
shareholder may at any time personally agree to pay by way of subscription for
any shares or otherwise. Any person having any claim against any Fund may look
only to the assets of that Fund to satisfy or enforce any debt, with respect to
that Fund.
If you agree to be legally bound by the provisions of this Agreement, please
sign a copy of this letter where indicated below and promptly return it to us,
c/o BISYS Fund Services, Limited Partnership, Administrator, 0000 Xxxxxxx Xxxx,
Xxxxx 0000, Xxxxxxxx, Xxxx 00000-0000.
Very truly yours,
The Victory Portfolios, on behalf of each of its series Funds, individually and
not jointly, and their classes that have adopted "Shareholder Servicing Plans",
as described in the Funds' current Registration Statement, as amended from time
to time.
Date: ________________________________________
By: __________________________________________
(Authorized Officer)
Title: _________________________________________
Accepted and Agreed to:
Firm Name ____________________________________
Date: ________________________________________
By: __________________________________________
(Authorized Officer)
Title:_________________________________________
October 2002
