Exhibit(h8)
ADMINISTRATION AND FUND ACCOUNTING AGREEMENT
THIS ADMINISTRATION AND FUND ACCOUNTING AGREEMENT dated as of this 1st day
of July, 1998 (the "Agreement"), by and between ABN AMRO FUND SERVICES, INC., a
Delaware corporation ("AAFSI"), having its principal offices at 000 Xxxxx
XxXxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx 00000, and ABN AMRO FUNDS, a Massachusetts
business trust (the "Company") having its principal place of business at 000
Xxxxx XxXxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx 00000.
WHEREAS, the Company is registered as an open-end management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act");
WHEREAS, the Company desires to retain AAFSI to perform certain
administrative services with respect to each investment portfolio listed in
Schedule A hereto (collectively, the "Funds"), as the same may be amended from
time to time by the parties hereto; and
WHEREAS, AAFSI is willing to perform such services on the terms and
conditions set forth herein.
WITNESSETH:
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein, the Company and AAFSI agree as follows:
1. Effective Date and Appointment. This Agreement shall be effective on the
date first written above. The Company hereby appoints AAFSI as Administrator of
the Company on the terms set forth in this Agreement. AAFSI accepts such
appointment and agrees to render the services hereinafter set forth.
2. Delivery of Documents. The Company shall, on or before the date this
Agreement goes into effect, but in any case within a reasonable period of time
for AAFSI to prepare to perform its duties hereunder, deliver or cause to be
delivered to AAFSI the following documents properly certified or authenticated:
(a) Resolutions of the Company's Board of Trustees authorizing the
appointment of AAFSI to provide certain administrative services required by the
Company for each Fund and approving this Agreement;
(b) The Company's Declaration of Trust (the "Declaration of Trust")
filed with the Commonwealth of Massachusetts and all amendments thereto;
(c) The Company's By-Laws and all amendments thereto (the "By-Laws");
(d) The Investment Advisory Agreement between ABN AMRO Asset
Management (USA) Inc. (the "Adviser") and the Company dated as of December 31,
1992 and all amendments thereto (the "Advisory Agreement");
(e) The Custody Agreement between CoreStates Bank, N.A. (the
"Custodian") and the Company dated as of December 31, 1992 and all amendments
thereto (the "Custody Agreement");
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(f) The Transfer Agency and Services Agreement between First Data
Investor Services Group, Inc. (the "Transfer Agent") and the Company dated as of
February 26, 1998 and all amendments thereto;
(g) The Distribution Agreement between First Data Distributors, Inc.
(the "Distributor") and the Company dated as of February 26, 1998 and all
amendments thereto (the "Distribution Agreement");
(h) The Company's Registration Statement on Form N-1A (the
"Registration Statement") under the Securities Act of 1933 and under the 1940
Act (File Nos. 33-52784 and 811-7244), as declared effective by the Securities
and Exchange Commission ("SEC") on December 31, 1992, relating to shares of the
Company's beneficial interests, no par value per share, and all amendments
thereto; and
(i) Each Fund's most recent prospectus and Statement of Additional
Information and all amendments and supplements thereto (collectively, the
"Prospectuses").
The Company will furnish AAFSI from time to time with copies, properly
certified or authenticated, of all amendments of or supplements to the
foregoing. Furthermore, the Company will provide AAFSI with any other documents
that AAFSI may reasonably request and will notify AAFSI as soon as possible of
any matter materially affecting the performance of AAFSI of its services under
this Agreement.
3. Duties as Administrator. Subject to the supervision and direction of
the Board of Trustees of the Company, AAFSI, as Administrator, will assist in
supervising various aspects of the Company's administrative operations and
undertakes to perform the following specific services:
(a) Administering and performing the customary services of an
administrator, including those described in Schedule D hereto and incorporated
herein and in accordance with the terms of the Registration Statement of the
Company on behalf of the Funds, applicable law, the procedures of the Company,
and the procedures established from time to time between AAFSI and the Company;
(b) Maintaining office facilities (which may be in the offices of
AAFSI or a corporate affiliate) and furnishing corporate officers for the
Company;
(c) Performing the functions ordinarily performed by a mutual fund
group's internal legal department as described in Schedule D to this Agreement,
furnishing data processing services, clerical services, and executive and
administrative services and standard stationery and office supplies in
connection with the foregoing;
(d) Accounting and bookkeeping services (including the maintenance of
such accounts, books and records of the Company as may be required by Section
31(a) of the 1940 Act and the rules thereunder);
(e) Internal auditing;
(f) Performing all functions ordinarily performed by the office of a
corporate treasurer, and furnishing the services and facilities ordinarily
incident thereto, including calculating the net asset value of the shares in
conformity with the Fund(s) prospectus(es);
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(g) Preparing reports to the Company's shareholders of record and the
SEC including, but not necessarily limited to, Annual Reports and Semi-Annual
Reports on Form N-SAR;
(h) Preparing and filing various reports or other documents required
by federal, state and other applicable laws and regulations, other than those
filed or required to be filed by the Adviser or Transfer Agent;
(i) Preparing and filing the Company's tax returns;
(j) Assisting the Adviser, at the Adviser's request, in developing
compliance procedures for the Company which will include, among other matters,
procedures monitoring compliance with each Fund's investment objective,
policies, restrictions, tax matters and applicable laws and regulations;
(k) Monitoring compliance with each Fund's investment objective,
policies, restrictions, tax matters and applicable laws and regulations in
accordance with the procedures established from time to time between AAFSI, the
Adviser and the Company;
(l) Performing all functions ordinarily performed by the office of a
corporate secretary, and furnishing the services and facilities incident
thereto, including all functions pertaining to matters organic to the
organization, existence and maintenance of the corporate franchise of the
Company, including preparation for, conduct of, and recording trustees' meetings
and shareholder meetings. Trustees' meetings in excess of five in any calendar
year and shareholder meetings in excess of one in any one year period shall be
for an additional reasonable charge as may be agreed upon by the Company and
AAFSI;
(m) Performing "Blue Sky" compliance functions, including maintaining
notice filings, qualifications or "Blue Chip" exemptions (if available) in all
U.S. jurisdictions requested by the Company, monitoring sales of shares in all
such jurisdictions and filing such additional notice or applying for such
additional or amended qualifications as may be reasonably anticipated to be
necessary to permit continuous sales of the shares of the Funds in all such
jurisdictions, filing sales literature and advertising materials to the extent
required, with such Blue Sky authorities, and making and filing all other
applications, reports, notices, documents and exhibits in connection with the
foregoing; and
(n) Furnishing all other services identified on Schedule D annexed
hereto and incorporated herein which are not otherwise specifically set forth
above.
(o) AAFSI agrees to provide the services set forth herein in
accordance with the Performance Standards annexed hereto as Exhibit 1 of
Schedule D and incorporated herein (the "Performance Standards"). Such
Performance Standards may be amended from time to time by the parties.
In performing its duties under this Agreement, AAFSI: (a) will act in
accordance with the Declaration of Trust, By-Laws, Prospectuses and with the
instructions and directions of the Company and will conform to and comply with
the requirements of the 1940 Act and all other applicable federal or state laws
and regulations; and (b) will consult with legal counsel to the Company, as
appropriate. Furthermore, AAFSI shall not have or be required to have any
authority to supervise the investment or
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reinvestment of the securities or other properties which comprise the assets of
the Company or any of its Funds and shall not provide any investment advisory
services to the Company or any of its Funds.
4. Compensation and Allocation of Expenses. AAFSI shall bear all expenses
in connection with the performance of its services under this Agreement, except
as indicated below.
(a) AAFSI will from time to time employ or associate with itself such
person or persons as AAFSI may believe to be particularly suited to assist it in
performing services under this Agreement. Such person or persons may be officers
and employees who are employed by both AAFSI and the Company. The compensation
of such person or persons shall be paid by AAFSI and no obligation shall be
incurred on behalf of the Company in such respect.
(b) AAFSI shall not be required to pay any of the following expenses
incurred by the Company: membership dues in the Investment Company Institute or
any similar organization; investment advisory expenses; costs of printing and
mailing prospectuses, reports and notices; interest on borrowed money; brokerage
commissions; taxes and fees payable to Federal, state and other governmental
agencies; fees of Trustees of the Company who are not affiliated with AAFSI;
outside auditing expenses; outside legal expenses; or other expenses not
specified in this Section 4 which are properly payable by the Company.
(c) The Company on behalf of each of the Funds will compensate AAFSI
for the performance of its obligations hereunder in accordance with the fees set
forth in the written Fee Schedule annexed hereto as Schedule B and incorporated
herein.
(d) The Company will compensate AAFSI for its services rendered
pursuant to this Agreement in accordance with the fees set forth above. Such
fees do not include reasonable out-of-pocket disbursements of AAFSI or Special
Legal Services, as described in Schedule C, for which AAFSI shall be entitled to
xxxx separately. Out-of-pocket disbursements shall include the items specified
in Schedule C, annexed hereto and incorporated herein, and such other expenses
as agreed upon in writing by AAFSI and the Company.
(e) AAFSI will xxxx the Company as soon as practicable after the end
of each calendar month, and said xxxxxxxx will be detailed in accordance with
the out-of-pocket schedule. The Company will pay to AAFSI the amount of such
billing by Federal Funds Wire within fifteen (15) business days after the
Company's receipt of said xxxx. In addition, AAFSI may charge a service fee on
any past due billed amount equal to the lesser of (i) one and one half percent
(1-1/2%) per month or (ii) the highest interest rate legally permitted.
(f) Any compensation agreed to hereunder may be adjusted from time to
time by attaching to Schedule B, a revised Fee Schedule, executed and dated by
the parties hereto.
(g) In the event that AAFSI has failed to meet a specific Performance
Standard category with respect to any Fund, as set forth in Exhibit 1 to
Schedule D, in two of any rolling three month periods, the Company may reduce
the total amount of fees due to AAFSI under this Agreement, excluding out-of-
pocket expenses, by an amount equal to five percent (5%) of the fees for the
third month. Notwithstanding the foregoing, the Company's right under this
Section 4(g) shall not be effective until ninety (90) days after AAFSI has begun
providing services under this Agreement.
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(h) In the event that AAFSI has failed to meet a specific Performance
Standard category with respect to the Fund, as set forth in Exhibit 1 to
Schedule D, in four of any rolling six month period, the Company may terminate
this Agreement in accordance with Section 8(d). Notwithstanding the foregoing,
the Company's right under this Section 4(h) shall not be effective until ninety
(90) days after AAFSI has begun providing services under this Agreement.
5. Limitation of Liability.
(a) AAFSI shall at all times act in good faith and agrees to use its best
efforts within commercially reasonable limits to ensure the accuracy of all
services performed under this Agreement. AAFSI shall not be liable for any error
of judgment or mistake of law or for any loss suffered by the Company in
connection with the performance of its obligations and duties under this
Agreement, except a loss resulting from AAFSI's willful misfeasance, bad faith
or negligence in the performance of such obligations and duties, or by reason of
its reckless disregard thereof, reliance on information furnished to the Company
by AAFSI or its affiliates, or AAFSI's refusal or failure to comply with the
terms or conditions of this Agreement. The Company shall not be liable to AAFSI
or any of its affiliates for any error of judgment or mistake of law or for any
loss suffered by AAFSI or its affiliates in connection with this Agreement,
except for a loss resulting from the Company's willful misfeasance, bad faith or
negligence, or by reason of its reckless disregard of its duties and obligations
hereunder.
(b) Each party shall have the duty to mitigate damages for which the other
party may become responsible.
(c) NOTWITHSTANDING ANYTHING IN THIS AGREEMENT TO THE CONTRARY, IN NO EVENT
SHALL EITHER PARTY, ITS AFFILIATES OR ANY OF ITS OR THEIR DIRECTORS, OFFICERS,
EMPLOYEES, AGENTS OR SUBCONTRACTORS BE LIABLE FOR LOST PROFITS, EXEMPLARY,
PUNITIVE, SPECIAL, INCIDENTAL, INDIRECT OR CONSEQUENTIAL DAMAGES.
6. Indemnification.
(a) The Company shall indemnify and hold AAFSI harmless from and
against any and all claims, costs, expenses (including reasonable attorneys'
fees), losses, damages, charges, payments and liabilities of any sort or kind
which may be asserted against AAFSI or for which AAFSI may be held to be liable
in connection with any action required to be taken pursuant to this Agreement (a
"Claim"), unless such Claim resulted from a willful misfeasance, bad faith or
negligence by AAFSI in the performance of its duties hereunder or reckless
disregard of its duties or obligations hereunder, reliance on information
furnished to the Company by AAFSI or its affiliates, or AAFSI's refusal or
failure to comply with the terms or conditions of this Agreement.
(b) AAFSI shall indemnify and hold the Company harmless from and
against any and all claims, costs, expenses (including attorney's fees), losses,
damages, charges, payments and liabilities of any sort or kind which may be
asserted against the Company, or for which the Company may be held liable in
connection with this Agreement, or AAFSI's performance hereunder (a "Claim"),
unless such Claim resulted from willful misfeasance, bad faith or negligence by
the Company in the performance of it duties or obligations hereunder, or
reckless disregard of its duties and obligations hereunder.
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(c) In any case in which one party (the "Indemnifying Party") may be
asked to indemnify or hold the other party (the "Indemnified Party") harmless,
the Indemnified Party will notify the Indemnifying Party promptly after
identifying any situation which it believes presents or appears likely to
present a claim for indemnification against the Indemnifying Party although the
failure to do so in good faith shall not prevent recovery by the Indemnified
Party and shall keep the Indemnifying Party advised with respect to all
developments concerning such situation. The Indemnifying Party shall have the
option to defend the Indemnified Party against any Claim which may be the
subject of this indemnification, and, in the event that the Indemnifying Party
so elects, such defense shall be conducted by counsel chosen by the Indemnifying
Party and satisfactory to the Indemnified Party whose approval shall not be
unreasonably withheld, and thereupon the Indemnifying Party shall take over
complete defense of the Claim and the Indemnified Party shall sustain no further
legal or other expenses in respect of such Claim. If the Indemnifying Party
elects to assume the defense of any suit and retains counsel, the Indemnified
Party shall bear the fees and expenses of any additional counsel retained by it.
The Indemnified Party will not confess any Claim or make any compromise in any
case in which the Indemnifying Party will be asked to provide indemnification,
except with the Indemnifying Party's prior written consent. The obligations of
the parties hereto under this Section 6 shall survive the termination of this
Agreement.
(d) Except for remedies which cannot be waived as a matter of law (and
injunctive or provisional relief), the provisions of this Article 6 shall be the
Indemnified Party's sole and exclusive remedy for claims or other actions or
proceedings to which the Indemnifying Party's indemnification obligations
pursuant to this Article 6 apply.
(e) In the event that the Indemnifying Party does not elect to assume
the defense of any such suit or in the case the Indemnified Party reasonably
does not approve of counsel chosen by the Indemnifying Party, or in the case
there is a conflict of interest between the Company and AAFSI, the Indemnifying
Party will reimburse the Indemnified Party, its officers, trustees, directors
and employees, or the controlling person or persons named as defendant or
defendants in such suit, for the reasonable fees and expenses of any counsel
retained by the Indemnified Party or such defendant(s). The Indemnifying Party's
indemnification agreement contained in this Section 6 and the Indemnifying
Party's representations and warranties contained in this Agreement shall remain
operative and in full force and effect regardless of any investigation made by
or on behalf of the Indemnified Party, its officers, directors, trustees or
employees, or any controlling person(s). This agreement of indemnity will inure
exclusively to the Indemnified Party's benefit, to the benefit of its several
officers, directors, trustees and employees, and their respective estates and to
the benefit of the controlling person(s) and their successors. The Indemnifying
Party agrees promptly to notify the Indemnified Party of the commencement of any
litigation or proceedings against the Indemnifying Party or any of its officers,
directors, trustees or employees in connection with the services rendered
hereunder.
7. EXCLUSION OF WARRANTIES. THIS IS A SERVICE AGREEMENT. EXCEPT AS
EXPRESSLY PROVIDED IN THIS AGREEMENT, AAFSI DISCLAIMS ALL OTHER REPRESENTATIONS
OR WARRANTIES, EXPRESS OR IMPLIED, MADE TO THE FUND OR ANY OTHER PERSON,
INCLUDING, WITHOUT 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) OF ANY SERVICES OR ANY GOODS
PROVIDED INCIDENTAL TO SERVICES PROVIDED UNDER THIS AGREEMENT. AAFSI DISCLAIMS
ANY WARRANTY OF TITLE OR NON-INFRINGEMENT EXCEPT AS OTHERWISE SET FORTH IN THIS
AGREEMENT.
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8. Term and Termination of Agreement.
(a) This Agreement shall be effective on the date first written above
and shall continue for a period of three (3) years (the "Initial Term"), unless
earlier terminated pursuant to the terms of this Agreement. Thereafter, this
Agreement shall automatically be renewed for successive terms of three (3) years
("Renewal Terms") each.
(b) Either party may terminate this Agreement at the end of the
Initial Term or at the end of any subsequent Renewal Term upon not than less
than ninety (90) days prior written notice to the other party. This Agreement
may be terminated by mutual written agreement of the parties.
(c) In the event a termination notice is given by the Company, all
reasonable expenses associated with movement of records and materials and
conversion thereof will be borne by the Company, provided, however, that AAFSI
shall use its best efforts to mitigate the costs associated with such
conversion.
(d) If a party hereto is guilty of a material failure to perform its
duties and obligations hereunder (a "Defaulting Party") resulting in a material
loss to the other party, such other party (the "Non-Defaulting Party") may give
written notice thereof to the Defaulting Party, and if such material breach
shall not have been remedied within thirty (30) days after such written notice
is given or such material breach is incapable of being remedied, as reasonably
determined by the Non-Defaulting Party, then the Non-Defaulting Party may
terminate this Agreement by giving thirty (30) days written notice of such
termination to the Defaulting Party. If AAFSI is the Non-Defaulting Party, its
termination of this Agreement shall not constitute a waiver of any other rights
or remedies of AAFSI with respect to services performed prior to such
termination or rights of AAFSI to be reimbursed for out-of-pocket expenses. In
all cases, termination by the Non-Defaulting Party shall not constitute a waiver
by the Non-Defaulting Party of any other rights it might have under this
Agreement or otherwise against the Defaulting Party.
(e) Notwithstanding anything contained in this Agreement to the
contrary, in the event that this Agreement is terminated by the Company and such
termination arises, either directly or indirectly as a result of the Company's
dissolution or the Company's acquisition of or consolidation or merger into or
with a mutual fund (the "New Company") for which AAFSI does not provide services
substantially similar to those provided to the Company hereunder, prior to the
effective date of such termination and the conversion of the Company's records
to the New Fund, or its agent, the Company shall pay to AAFSI the fee set forth
in Schedule B (the "Early Termination Fee").
(f) This Agreement may be terminated by the Company without penalty in
the event of its assignment, as such term is defined in the 1940 Act, by AAFSI
provided that 45 days prior written notice of termination must be given to AAFSI
within 120 days following the assignment.
9. Modifications and Waivers; Authority to Act. No change, termination,
modification, or waiver of any term or condition of the Agreement shall be valid
unless in writing signed by each party. No such writing shall be effective as
against AAFSI unless said writing is executed by a Senior Vice President,
Executive Vice President or President of AAFSI. A party's waiver of a breach of
any term or condition in the Agreement shall not be deemed a waiver of any
subsequent breach of the same or another term or condition. Any officer,
director, partner, employee or agent of the Company who is also an officer,
director, partner, employee or agent of AAFSI shall be deemed to be rendering
services to or
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acting solely for the Company, except when rendering services or conducting
business in connection with AAFSI's duties hereunder.
10. No Presumption Against Drafter. AAFSI and the Company have jointly
participated in the negotiation and drafting of this Agreement. The Agreement
shall be construed as if drafted jointly by the Company and AAFSI, and no
presumptions arise favoring any party by virtue of the authorship of any
provision of this Agreement.
11. Publicity. Neither AAFSI nor the Company shall release or publish
news releases, public announcements, advertising or other publicity relating to
this Agreement or to the transactions contemplated by it, other than factual
statements concerning the existence of the relationship, without prior review
and written approval of the other party; provided, however, that either party
may make such disclosures as are required by legal, accounting or regulatory
requirements after making reasonable efforts in the circumstances to consult in
advance with the other party.
12. Severability. The parties intend every provision of this Agreement to
be severable. If a court of competent jurisdiction determines that any term or
provision is illegal or invalid for any reason, the illegality or invalidity
shall not affect the validity of the remainder of this Agreement. In such case,
the parties shall in good faith modify or substitute such provision consistent
with the original intent of the parties. Without limiting the generality of
this paragraph, if a court determines that any remedy stated in this Agreement
has failed of its essential purpose, then all other provisions of this
Agreement, including the limitations on liability and exclusion of damages,
shall remain fully effective.
13. Notice. Any notice or other instrument authorized or required by this
Agreement to be given in writing to the Company or AAFSI shall be sufficiently
given if addressed to the party and received by it at its office set forth below
or at such other place as it may from time to time designate in writing.
To the Company:
ABN AMRO Funds
X.X. Xxx 0000-0000
Xxxxxxxxxx, XX 00000-0000
To AAFSI
ABN AMRO Fund Services, Inc.
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxx Xxxxx
with a copy to AAFSI's Chief Counsel: Xxxxxx Xxxxxxx
14. Assignment and Subcontracting. This Agreement, its benefits and
obligations shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and permitted assigns and is not intended to
confer upon any other person any rights or remedies hereunder. This Agreement
may not be assigned or otherwise transferred by either party hereto, without the
prior written consent of the other party, which consent shall not be
unreasonably withheld; provided, however, that AAFSI may, in its sole
discretion, assign all its right, title and interest in this Agreement to an
affiliate,
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parent or subsidiary, or to the purchaser of substantially all of its business.
It is agreed that AAFSI may enter into a subadministration contract with First
Data Investor Services Group, Inc. to perform administrative services in
connection with this Agreement.
15. Governing Law/Venue. The laws of the Commonwealth of Massachusetts,
excluding the laws on conflicts of laws, shall govern the interpretation,
validity, and enforcement of this Agreement. To the extent that the provisions
of Massachusetts law or the provisions hereof conflict with the 1940 Act, the
1940 Act shall control.
16. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original and which
collectively shall be deemed to constitute only one instrument.
17. Captions. The captions of this Agreement are included for
convenience of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect.
18. Obligations of the Company. The Company and AAFSI agree that the
obligations of the Company under the Agreement shall not be binding upon any of
the Trustees, shareholders, nominees, officers, employees or agents, whether
past, present or future, of the Company individually, but are binding only upon
the assets and property of the Company, as provided in the Declaration of Trust.
The execution and delivery of this Agreement have been authorized by the
Trustees of the Company, and signed by an authorized officer of the 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 or any shareholder of the Company individually or to impose any
liability on any of them or any shareholder of the Company personally, but shall
bind only the assets and property of the Company as provided in the Declaration
of Trust. The Company and AAFSI further agree that the obligations of a Fund
under the Agreement shall not be binding upon any other Fund, but are binding
only upon the assets and property of such Fund, as provided in the Declaration
of Trust.
19. Arbitration.
(a) Any claim or controversy arising out of or related to this
Agreement, or breach hereof, shall be settled by arbitration administered by the
American Arbitration Association in Massachusetts in accordance with its
applicable rules, except that the Federal Rules of Evidence and the Federal
Rules of Civil Procedure with respect to the discovery process shall apply. The
parties hereby agree that judgment upon the award rendered by the arbitrator may
be entered in any court having jurisdiction.
(b) The parties acknowledge and agree that the performance of the
obligations under this Agreement necessitates the use of instrumentalities of
interstate commerce and, notwithstanding other general choice of law provisions
in this Agreement, the parties agree that the Federal Arbitration Act shall
govern and control with respect to the provisions of this Article.
20. Additional Funds. In the event that the Company establishes one or
more Funds in addition to those identified in Schedule A, with respect to which
the Company desires to have AAFSI render services as administrator under the
terms hereof, the Company shall so notify AAFSI in writing, and if AAFSI agrees
in writing to provide such services, Schedule A shall be amended to include such
additional Funds.
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21. Confidentiality: Ownership.
(a) Confidentiality. In the course of performance under this
Agreement, each party may have access to and receive disclosure of confidential
information about the other party, including but not limited to that party's
financial information, financial strategies, marketing plans, customer profiles,
sales estimates, business plans and a variety of other information which the
receiving party should reasonably consider to be confidential and proprietary
(hereinafter referred to as "Confidential Information"). The contents of this
Agreement are also Confidential Information. Each party shall exercise
reasonable care to safeguard the confidentiality of the Confidential Information
of the other. Confidential Information of the disclosing party shall be used by
the receiving party solely in the performance of the receiving party's
obligations pursuant to this Agreement. The receiving party shall receive
Confidential Information in confidence and not disclose Confidential Information
of the disclosing party to any third party, except as may be necessary for the
receiving party to perform its obligations pursuant to this Agreement, as
required by law or a court of competent jurisdiction or by a regulatory agency
with supervisory responsibilities over the disclosing party, for confidential
consultations with accountants or attorneys, or as may otherwise be agreed upon
in writing by the disclosing party. Each party may, however, disclose
Confidential Information to its parent corporation, affiliates, subsidiaries and
affiliated companies and employees, provided that each shall use reasonable
efforts to ensure that the Confidential Information is not duplicated or
disclosed in breach of this Agreement.
Each party acknowledges that breach of the restrictions on use,
dissemination or disclosure of any Confidential Information of the other party
would result in immediate and irreparable harm, and money damages would be
inadequate to compensate the other party for that harm. Each party shall be
entitled to equitable relief, in addition to all other available remedies, to
redress any such breach.
(b) Ownership. In the course of performance under this Agreement,
AAFSI may create reports, marketing materials, promotional materials, and other
materials relating to the Company ("Results"). The Company acknowledges and
agrees that AAFSI is the sole owner of all rights (including, but not limited
to, copyrights) to any Results, or aspects of Results, that are used by AAFSI
for administering its clients generally and are not created solely for the
Company. Notwithstanding the foregoing, all rights (including, but not limited
to, copyrights) to any Results that are created solely for the Company
(including, but not limited to, any marketing materials and promotional
materials created solely in connection with the Company) are solely owned by the
Company and are assigned to the Company by AAFSI and the Company shall have a
perpetual, royalty free, worldwide, transferable license to use, copy, transmit,
distribute and modify any Results owned by AAFSI as may reasonably be necessary
for the Company to exploit fully all of its rights in any Results owned by the
Company.
22. Records. Notwithstanding any other provisions in this Agreement,
AAFSI, directly or through third parties, shall maintain and preserve for the
periods prescribed therein, records relating to the services to be performed
under this Agreement which are required under the 1940 Act, and the rules and
regulations thereunder. Any records required to be maintained and preserved
under the 1940 Act which are prepared or maintained by AAFSI on behalf of the
Company shall be prepared and maintained at the expense of AAFSI, but shall be
the property of the Company, shall be readily accessible during normal business
hours to the Company and its duly authorized agents, and shall be surrendered
promptly to the Company on written request or upon termination of this
Agreement. Records shall be surrendered in usable machine readable form. In the
case of any request or demand for the inspection of such records by another
party, AAFSI shall notify the Company and follow the Company's instructions as
to permitting
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or refusing such inspection; provided that AAFSI may exhibit such records to any
person in any case where it is advised by its counsel that it may be held liable
for failure to do so, unless (in cases involving potential exposure only to
civil liability) the Company has agreed to indemnify AAFSI against such
liability and any expenses incurred.
23. Force Majeure. No party shall be liable for any default or delay in
the performance of its obligations under this Agreement if and to the extent
such default or delay is caused, directly or indirectly, by (i) fire, flood,
elements of nature or other acts of God; (ii) any outbreak or escalation of
hostilities, war, riots or civil disorders in any country, (iii) any act or
omission of the other party or any governmental authority; (iv) any labor
disputes (whether or not the employees' demands are reasonable or within the
party's power to satisfy); or (v) nonperformance by a third party or any similar
cause beyond the reasonable control of such party, including without limitation,
failures or fluctuations in telecommunications or other equipment. In any such
event, the non-performing party shall be excused from any further performance
and observance of the obligations so affected only for so long as such
circumstances prevail and such party continues to use commercially reasonable
efforts to recommence performance or observance as soon as practicable.
24. Equipment Failures. Notwithstanding any other provision in this
Agreement, in the event of equipment failures or the occurrence of events beyond
AAFSI's control which render its performance under this Agreement impossible,
AAFSI shall at no additional expense to the Company take reasonable steps to
minimize service interruptions. AAFSI represents that the various procedures
and systems which AAFSI has implemented with regard to safekeeping from loss or
damage attributable to fire, theft or any other cause of the records, and other
data of the Company and AAFSI's records, data, equipment, facilities and other
property used in performance of its obligations hereunder are reasonably
adequate and are covered by a reasonably adequate disaster recovery plan, and it
will make such changes therein from time to time as are reasonably required for
the secure performance of its obligations hereunder.
25. Year 2000. AAFSI's services hereunder shall be rendered, and its
computer systems used in rendering such services shall operate and function,
without any Year 2000 Error. The term "Year 2000 Error" means:
(a) any failure of AAFSI's systems to properly record, store, process,
calculate or present calendar dates falling on and after (and, if applicable,
spans of time including) January 1, 2000 as a result of the occurrence or use of
data consisting of such dates;
(b) any failure of AAFSI's systems to calculate any information
dependent on or relating to dates on or after January 1, 2000 in the same
manner, and with the same functionality, date integrity and performance, as such
systems record, store, process, calculate and present calendar dates on or
before December 31, 1999, or information dependent on or relating to such dates;
or
(c) any loss of functionality or performance with respect to the
introduction of records or processing of data containing dates falling on or
after January 1, 2000.
26. Entire Agreement. This Agreement, including all Schedules hereto,
constitutes the entire Agreement between the parties with respect to the subject
matter hereof and supersedes all prior and contemporaneous proposals,
agreements, contracts, representations, and understandings, whether written or
oral, between the parties with respect to the subject matter hereof.
-11-
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
duly executed and delivered by their duly authorized officers as of the date
first written above.
ABN AMRO FUND SERVICES, INC.
/s/ Xxxxxx Xxxxxxx
By:__________________________________
Xxxxxx Xxxxxxx
Name:________________________________
Corporate Secretary
Title:_______________________________
ABN AMRO FUNDS
/s/ X.X. Xxxxxxxx
By:__________________________________
X.X. Xxxxxxxx
Name:________________________________
Fund Officer
Title:_______________________________
-12-
SCHEDULE A
Money Market Funds
Treasury Money Market Fund
Government Money Market Fund
Money Market Fund
Tax-Exempt Money Market Fund
Fixed Income Funds
Fixed Income Fund
Intermediate Government Fixed Income Fund
Tax-Exempt Fixed Income Fund
International Fixed Income Fund
Limited Volatility Fixed Income Fund
Balanced Funds
Balanced Fund
Equity Funds
Value Fund
Growth Fund
International Equity Fund
Small Cap Growth Fund
Small Cap Value Fund
Asian Tigers Fund
TransEurope Fund
Latin America Equity Fund
Real Estate Fund
-13-
SCHEDULE B
----------
FEE SCHEDULE
For the services to be rendered, the facilities to be furnished and the
payments to be made by AAFSI, as provided for in this Agreement, the Company, on
behalf of each Fund, will pay AAFSI a fee for the previous month at the rates
listed below. The fee for the period from the effective date of this Agreement
to the end of such month shall be prorated according to the proportion that such
period bears to the full monthly period. Upon any termination of this Agreement
before the end of any month, the fee for such part of a month shall be prorated
according to the proportion which such period bears to the full monthly period
and shall be payable upon the date of termination of this Agreement.
. Fund Administration Fee:
0.15% of average net assets
. Fund Accounting Fee:
Per Fund $35,000
Each additional class $2,500
. Early Termination Fee:
The Early Termination Fee referred to in Section 8(e) of this
Agreement, shall equal in the aggregate $1,500,000 if such
termination occurs during the first year of the Agreements and
$750,000 if such termination occurs during the second year of the
Agreements.
. AAFSI shall be entitled to collect all out-of-pocket fees described in
Schedule C.
-14-
SCHEDULE C
----------
OUT-OF-POCKET EXPENSES
Out-of-pocket expenses include, but are not limited to, the following:
- Postage of Board meeting materials and other materials to the Company's
Board members and service providers (including overnight or other
courier services)
- Telecommunications charges (including FAX) with respect to
communications with the Company's directors, officers and service
providers
- Travel to and from Board Meetings and other meetings with Fund
management by persons AAFSI deems necessary
- Duplicating charges with respect to filings with federal and state
authorities and Board meeting materials
- Courier services
- Pricing services
- Forms and supplies for the preparation of Board meetings and other
materials on behalf of the Company
- Vendor set-up charges for Blue Sky services
- Customized programming requests
- Such other expenses as are agreed to by AAFSI and the Company
-15-
SCHEDULE D
----------
Fund Accounting and Administrative Services
Oversight/Management Responsibilities
. Supervision and coordination of transfer agent
. Supervision and coordination of XXX custodian
. Supervision and coordination of Fund custodian
. Vendor management and invoicing
. Coordinate licensing arrangements with ABN AMRO
. Daily report coordination
. Media relations
. Sales literature & forms development
. Trade show coordination
. Fund operations coordination
. Coordination of all s/o mailings
. Management of auditor relationship
. Oversight of portfolio compliance function
Routine Projects
. Daily, Weekly, and Monthly Reporting
. Portfolio and General Ledger Accounting
. Daily Pricing of all Securities
. Daily Valuation and NAV Calculation. Monitoring compliance with all
applicable procedures. Support and report delivery to the valuation
committee
. Comparison of NAV to market movement
. Review of price tolerance/fluctuation report
. Research items appearing on the price exception report
. Weekly cost monitoring along with market-to-market valuations in accordance
with Rule 2a7
. Preparation of monthly ex-dividend monitor
. Daily cash reconciliation with the custodian bank
. Daily updating of price and rate information to the Transfer Agent/
Insurance Agent
. Daily support and report delivery to Portfolio Management
. Daily calculation of fund advisor fees and waivers
. Daily calculation of distribution rates
. Daily maintenance of each fund's general ledger including expense accruals
. Daily price notification to other vendors as required
. Calculation of 30-day adjusted SEC yields
. Preparation of month-end reconciliation package
. Monthly reconciliation of fund expense records
. Preparation of monthly pay down gain/loss summaries
. Preparation of all annual and semi-annual audit work papers
. Preparation and Printing of Financial Statements
. Providing Shareholder Tax Information to Transfer Agent
. Producing Drafts of IRS and State Tax Returns
-16-
. Treasury Services including:
Provide Officer for the fund
Expense Accrual Monitoring
Determination of Dividends
Prepare materials for review by the board, e.g., 2a-7,10f-3, 17a-7,
17e-1, Rule 144a
Tax and Financial Counsel
. Monthly Compliance Testing including Section 817H
. Other services ordinarily performed and provided by a fund administrator
and fund accounting department
-17-
Legal, Regulatory and Board of Trustees Support
Routine Legal Services
Corporate Secretarial
---------------------
. Assist in maintaining corporate records and good standing status of Fund in
its state of organization
. Provide Secretary/Assistant Secretary for Fund
. Develop and maintain calendar of annual and quarterly board approvals and
regulatory filings
. Prepare notice, agenda, memoranda, resolutions and background materials for
legal approval at quarterly board meetings; attend meetings; make
presentations where appropriate; prepare minutes; follow up on issues
. Provide support for one special board meeting per year and written consent
votes where needed
Regulatory/Filings
------------------
. Prepare and file annual Post-Effective Amendment
. Prepare and file Rule 24e-2 and Rule 24f-2 Notices
. Review and file Form N-SAR
. Review and file Annual and Semi-Annual Financial Reports
. Prepare prospectus supplements as needed
Miscellaneous Routine Legal Services
------------------------------------
. Communicate significant regulatory or legislative developments to Fund
management and directors and provide related planning assistance where needed
. Consult with Fund management regarding portfolio compliance and Fund
corporate and regulatory issues as needed
. Maintain effective communication with outside counsel and review legal bills
of outside counsel
. Coordinate the printing and mailing process with outside printers for all
shareholder publications
. Review sales material and advertising for Fund SEC and NASD compliance
. Arrange D&O/E&O insurance and fidelity bond coverage for Fund
. Assist in managing SEC audits of Funds
. Assist in monitoring Fund Code of Ethics reporting and provide such reports
to Adviser
. Assist in developing compliance guidelines and procedures to improve overall
compliance by Fund and service providers
Special Legal Services (billed separately)
. Assist in conversion
Coordinate time and responsibility schedules
Draft notice, agenda, memoranda, resolutions and background materials for
board approval
. Assist in new fund start-up (to the extent requested)
Coordinate time and responsibility schedules
Prepare Fund corporate documents (MTA/by-laws)
Draft/file registration statement (including investment objectives/policies
and prospectuses)
Respond to and negotiate SEC comments
Draft notice, agenda and resolutions for organizational meeting; attend
board meeting; make presentations where appropriate; prepare minutes and
follow up on issues
. Prepare notice, agenda, memoranda and background materials for special
board meetings, make presentations where appropriate, prepare minutes and
follow up on issues*
-18-
. Prepare proxy material for special meetings (including fund merger
documents)*
. Prepare PEA for special purposes (e.g., new funds or classes, changes in
advisory relationships, mergers, restructurings)*
. Assist in extraordinary non-recurring projects
Arrange CDSC financial programs
Prospectus simplification
Profile prospectuses
Exemptive order applications
. Provide consultative legal services as needed
* Services and charges may vary based on volume. Special Legal Services shall
be billed at a rate of $185 per hour subject to certain project caps as may be
agreed to by AAFSI and the Company. No Special Legal Services shall be
undertaken by AAFSI without the prior written consent of the Company.
-19-
EXHIBIT 1 TO SCHEDULE D
AAFSI
PERFORMANCE STANDARDS
AAFSI'S obligation to meet the following Performance Standards shall be measured
in the aggregate with respect to all Funds of the Company.
AAFSI will report to the Company on a monthly basis the percent of items
completed within standard as well as a quality rating. Reporting will be
detailed to the transaction type level. A pass/fail determination for
contractual penalties will however be based on the categories listed below. For
example, the accuracy of NAV calculations will be reported to the Fund on an
individual basis and as a collective group. AAFSI will receive a "fail" for the
month if the collective score for all financials falls below the contractual
level. Note that completion standards are measured in business days.
Fund Accounting/Custody Liaison
-------------------------------
. NAVs calculated accurately, provided that all information received from
external vendors or Fund managers is correct
. Information to nasdaq is reported accurately and within appropriate time
frames
. Daily bulletin is released by 6:30 p.m. Eastern Time, provided that all
information received from external vendors or Fund managers is received on
a timely basis
. Accurate Cash Availability will be provided by 9:30 a.m. Eastern Time
. Budget analysis
The above standards will be adhered to at least 98% of the time measured on a
monthly basis.
Fund Administration (Treasury and Reporting)/Tax/Compliance
-----------------------------------------------------------
. All SEC and IRS regulatory requirements will be met according to the
deadlines set forth by the SEC and the IRS
. Notification to Adviser and Sub-Adviser within two (2) business days with
compliance violations based on procedures established by and among AAFSI
and the Company
The above standard will be met 100% of the time.
Legal Administration
--------------------
. Board materials will be sent to the Company for review fourteen (14)
business days prior to the Board meeting
. Review of sales literature - response within seven (7) business days
The above standard will be met 98% of the time as measured on a quarterly basis.
-20-
. Timely submission of sales literature to NASD
The above standard will be met 98% of the time as measured on a quarterly basis.
-21-
