Exhibit K
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ADMINISTRATION AND ACCOUNTING SERVICES AGREEMENT
THIS AGREEMENT is made as of May 19, 2005 by and between RESTORATION
OPPORTUNITIES FUND, a Massachusetts business trust (the "Fund"), and PFPC INC.,
a Massachusetts corporation ("PFPC").
W I T N E S S E T H :
WHEREAS, the Fund is registered as a closed-end, non-diversified
management investment company under the Investment Company Act of 1940, as
amended (the "1940 Act"); and
WHEREAS, the Fund wishes to retain PFPC to provide certain
administration and accounting services provided for herein, and PFPC wishes to
furnish such services.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, and intending to be legally bound hereby, the
parties hereto agree as follows:
1. Definitions. As Used in this Agreement:
(a) "1933 Act" means the Securities Act of 1933, as amended, and
the rules and regulations of the SEC promulgated thereunder.
(b) "1934 Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the SEC promulgated
thereunder.
(c) "1940 Act" has the meaning set forth in the recitals hereof
and includes the rules and regulations of the SEC promulgated
thereunder.
(d) "Authorized Person" means any officer of the Fund and any
other person duly authorized by the Fund's Board of Trustees
to give Oral Instructions or Written Instructions on behalf
of the Fund and listed on the Authorized Persons Appendix
attached hereto and made a part hereof or any amendment
thereto as may be received by PFPC. An Authorized Person's
scope of authority may be limited by the Fund by setting
forth such limitation in the Authorized Persons Appendix.
(e) "Board of Trustees" and "Shareholders" shall have the same
meanings as used in the Fund's Amended and Restated Agreement
and Declaration of Trust.
(f) "Declaration" means the Fund's Amended and Restated Agreement
and Declaration of Trust, as amended from time to time.
(g) "Oral Instructions" mean oral instructions received by PFPC
from an Authorized Person or from a person reasonably
believed by PFPC to be an Authorized Person.
(h) "SEC" means the Securities and Exchange Commission.
(i) "Securities Laws" mean the 1933 Act, the 1934 Act and the
1940 Act.
(j) "Shares" means the Fund's shares of beneficial interest.
(k) "Written Instructions" mean (i) written instructions signed
by an Authorized Person and received by PFPC or (ii) trade
instructions transmitted (and received by PFPC) by means of
an electronic transaction reporting system, access to which
requires use of a password or other authorized identifier.
The instructions may be delivered by hand, mail, tested
telegram, cable, telex or facsimile sending device.
2. Appointment. The Fund hereby appoints PFPC to provide administration
and accounting services to the Fund, in accordance with the terms set
forth in this Agreement. PFPC accepts such appointment and agrees to
furnish such services.
3. Compliance with Rules and Regulations.
PFPC agrees to comply with the applicable requirements of the
Securities Laws, and any laws, rules and regulations of governmental
authorities having jurisdiction with respect to the duties to be
performed by PFPC hereunder. Except as specifically set forth herein,
PFPC assumes no responsibility for such compliance by the Fund.
4. Instructions.
(a) Unless otherwise provided in this Agreement, PFPC shall act
only upon Oral Instructions or Written Instructions,
including standing Written Instructions related to ongoing
instructions received electronically.
(b) PFPC shall be entitled to rely upon any Oral Instructions or
Written Instructions it receives from an Authorized Person
(or from a person reasonably believed by PFPC to be an
Authorized Person) pursuant to this Agreement. PFPC may
assume that any Oral Instruction or Written Instruction
received hereunder is not in any way inconsistent with the
provisions of organizational documents or this Agreement or
of any vote, resolution or proceeding of the Fund's Board of
Trustees or the Fund's Shareholders, unless and until PFPC
receives Written Instructions to the contrary.
(c) The Fund agrees to forward to PFPC Written Instructions
confirming Oral Instructions (except where such Oral
Instructions are given by PFPC or its affiliates) and shall
endeavor to ensure that PFPC receives the Written
Instructions by the close of business on the same day that
such Oral Instructions are received. The fact that such
confirming Written Instructions are not received by PFPC
shall in no way invalidate the transactions or enforceability
of the transactions authorized by the Oral Instructions.
Where Oral Instructions or Written Instructions reasonably
appear to have been received from an Authorized Person, PFPC
shall incur no liability to the Fund in acting upon such Oral
Instructions or Written Instructions provided that PFPC's
actions comply with the other provisions of this Agreement.
5. Right to Receive Advice.
(a) Advice of the Fund. If PFPC is in doubt as to any action it
should or should not take, PFPC may request directions or
advice, including Oral Instructions or Written Instructions,
from the Fund.
(b) Advice of Counsel. If PFPC shall be in doubt as to any
question of law pertaining to any action it should or should
not take, PFPC may request advice at its own cost from such
counsel of its own choosing (who may be counsel for the Fund,
the Fund's investment adviser or PFPC, at the option of
PFPC).
(c) Conflicting Advice. In the event of a conflict between
directions, advice or Oral Instructions or Written
Instructions PFPC receives from the Fund, and the advice it
receives from counsel, PFPC shall be entitled to rely upon
and follow the advice of counsel, provided that such counsel
is selected with reasonable care. PFPC shall promptly inform
the Fund of such conflict and PFPC shall refrain from acting
in the event of a conflict unless counsel advises PFPC that a
failure to take action is likely to result in additional
loss, liability or expense. In the event PFPC relies on the
advice of counsel, PFPC remains liable for any action or
omission on the part of PFPC which constitutes willful
misfeasance, bad faith, gross negligence or reckless
disregard by PFPC of any duties, obligations or
responsibilities set forth in this Agreement.
(d) Protection of PFPC. PFPC shall be protected in any action it
takes or does not take in reliance upon directions, advice or
Oral Instructions or Written Instructions it receives from
the Fund or (to the extent permitted under clause (c) above)
from counsel and which PFPC believes, in good faith, to be
consistent with those directions, advice or Oral Instructions
or Written Instructions. Nothing in this section shall be
construed so as to impose an obligation upon PFPC (i) to seek
such directions, advice or Oral Instructions or Written
Instructions, or (ii) to act in accordance with such
directions, advice or Oral Instructions or Written
Instructions unless, under the terms of other provisions of
this Agreement, the same is a condition of PFPC's properly
taking or not taking such action. Nothing in this subsection
shall excuse PFPC when an action or omission on the part of
PFPC constitutes willful misfeasance, bad faith, negligence
or reckless disregard by PFPC of any duties, obligations or
responsibilities set forth in this Agreement.
6. Records; Visits.
(a) The books and records pertaining to the Fund, which are in
the possession or under the control of PFPC, shall be the
property of the Fund. Such books and records shall be
prepared, preserved and maintained as required by the 1940
Act and other applicable securities laws, rules and
regulations. The Fund and its duly authorized officers,
employees and agents and the staff of the SEC shall have
access to such books and records at all times during PFPC's
normal business hours. Upon the reasonable request of the
Fund, copies of any such books and records shall be provided
by PFPC to the Fund or to an Authorized Person, at the Fund's
expense. Any such books and records may be maintained in the
form of electronic media and stored on any magnetic disk or
tape or similar recording method. No records will be
destroyed without the Fund's written consent.
(b) PFPC shall keep the following records:
(i) all books and records with respect to the Fund's
books of account; and
(ii) records of the Fund's securities transactions.
7. Confidentiality.
Each party shall keep confidential any information relating to the
other party's business ("Confidential Information"). Confidential
Information shall include (a) any data or information that is
competitively sensitive material, and not generally known to the
public, including, but not limited to, information about product
plans, marketing strategies, finances, operations, customer
relationships, customer profiles, customer lists, sales estimates,
business plans, and internal performance results relating to the past,
present or future business activities of the Fund or PFPC, their
respective subsidiaries and affiliated companies and the customers,
clients and suppliers of any of them; (b) any scientific or technical
information, design, process, procedure, formula, or improvement that
is commercially valuable and secret in the sense that its
confidentiality affords the Fund or PFPC a competitive advantage over
its competitors; (c) all confidential or proprietary concepts,
documentation, reports, data, specifications, computer software,
source code, object code, flow charts, databases, inventions,
know-how, and trade secrets, whether or not patentable or
copyrightable; and (d) anything designated as confidential.
Notwithstanding the foregoing, information shall not be subject to
such confidentiality obligations if it: (a) is already known to the
receiving party at the time it is obtained; (b) is or becomes publicly
known or available through no wrongful act of the receiving party; (c)
is rightfully received from a third party who, to the best of the
receiving party's knowledge, is not under a duty of confidentiality;
(d) is released by the protected party to a third party without
restriction; (e) is required to be disclosed by the receiving party
pursuant to a requirement of a court order, subpoena, governmental or
regulatory agency or law (provided the receiving party will provide
the other party written notice of such requirement, to the extent such
notice is permitted); (f) is relevant to the defense of any claim or
cause of action asserted against the receiving party; or (g) has been
or is independently developed or obtained by the receiving party.
8. Liaison with Accountants. PFPC shall act as liaison with the Fund's
independent public accountants and shall provide account analyses,
fiscal year summaries, and other audit-related schedules with respect
to the Fund. PFPC shall take all reasonable action in the performance
of its obligations under this Agreement to ensure that the necessary
information is made available to such independent public accountants
as reasonably requested by the Fund.
9. PFPC System. PFPC shall retain title to and ownership of any and all
data bases, computer programs, screen formats, report formats,
interactive design techniques, derivative works, inventions,
discoveries, patentable or copyrightable matters, concepts, expertise,
patents, copyrights, trade secrets, and other related legal rights
utilized by PFPC in connection with the services provided by PFPC to
the Fund.
10. Disaster Recovery. PFPC shall enter into and shall maintain in effect
with appropriate parties one or more agreements making reasonable
provisions for emergency use of electronic data processing equipment.
In the event of equipment failures, PFPC shall, at no additional
expense to the Fund, take reasonable steps to minimize service
interruptions. PFPC shall have no liability with respect to the loss
of data or service interruptions caused by equipment failure, provided
such loss or interruption is not caused by PFPC's own willful
misfeasance, bad faith, negligence or reckless disregard of its duties
or obligations under this Agreement.
11. Compensation. As compensation for services rendered by PFPC during the
term of this Agreement, the Fund will pay to PFPC a fee or fees as may
be agreed to from time to time in writing by the Fund and PFPC.
12. Indemnification.
(a) The Fund agrees to indemnify and hold harmless PFPC and its
affiliates from all taxes, charges, expenses, assessments,
claims and liabilities (including without limitation
reasonable attorneys' fees and disbursements and liabilities
arising under the Securities Laws and any state and foreign
securities and blue sky laws) (collectively, "Losses")
arising directly or indirectly from any action or omission to
act which PFPC takes (i) at the request or on the direction
of or in reliance on the advice of the Fund or (ii) upon Oral
Instructions or Written Instructions; provided, however,
neither PFPC nor any of its affiliates, shall be indemnified
against any liability (or any expenses incident to such
liability) arising out of PFPC's or its affiliates' own
willful misfeasance, bad faith, negligence or reckless
disregard of its duties and obligations under this Agreement.
(b) Notwithstanding anything in this Agreement to the contrary,
the Fund shall not be liable to PFPC or its affiliates for
any consequential, special or indirect losses or damages
which PFPC or its affiliates may incur or suffer as a
consequence of this Agreement, whether or not the likelihood
of such damages or losses was known by the Fund.
13. Responsibility of PFPC.
(a) PFPC shall be under no duty to take any action on behalf of
the Fund except as necessary to fulfill its duties and
obligations as specifically set forth herein or as may be
specifically agreed to by PFPC in writing. PFPC shall be
obligated to exercise care and diligence in the performance
of its duties hereunder and to act in good faith and to use
its best efforts, within reasonable limits, in performing
services provided for under this Agreement. PFPC agrees to
indemnify and hold harmless the Fund from Losses arising out
of PFPC's failure to perform its duties under this Agreement
to the extent such damages arise out of PFPC's willful
misfeasance, bad faith, negligence or reckless disregard of
such duties.
(b) Without limiting the generality of the foregoing or of any
other provision of this Agreement, (i) PFPC shall not be
liable for losses beyond its control, provided that PFPC has
acted in accordance with the standard of care set forth
above; and (ii) PFPC shall not be liable for (A) the validity
or invalidity or authority or lack thereof of any Oral
Instruction or Written Instruction, notice or other
instrument which conforms to the applicable requirements of
this Agreement and which PFPC reasonably believes to be
genuine; or (B) subject to Section 10, delays or errors or
loss of data occurring by reason of circumstances beyond
PFPC's control, including acts of civil or military
authority, national emergencies, labor difficulties, fire,
flood, catastrophe, acts of God, insurrection, war, riots or
failure of the mails, transportation, communication or power
supply.
(c) Notwithstanding anything in this Agreement to the contrary,
the Fund shall not be liable to PFPC or its affiliates for
any consequential, special or indirect losses or damages
which PFPC or its affiliates may incur or suffer as a
consequence of this Agreement, whether or not the likelihood
of such damages or losses was known by the Fund.
14. Description of Accounting Services on a Continuous Basis.
PFPC will perform the following accounting services:
(i) Journalize investment, capital and income and
expense activities;
(ii) Verify investment buy/sell trade tickets when
received from the investment adviser (the
"Adviser");
(iii) Maintain individual ledgers for investment
securities;
(iv) Maintain historical tax lots for each security;
(v) Record and reconcile corporate action activity and
all other capital changes;
(vi) Reconcile cash and investment balances with the
Fund's custodian(s), and provide the Adviser with
the beginning cash balance available for investment
purposes;
(vii) Update the cash availability throughout the day as
required by the Adviser;
(viii) Calculate contractual expenses, including management
fees, as applicable, in accordance with the Fund's
prospectus;
(ix) Post to and prepare the Statement of Assets and
Liabilities and the Statement of Operations in U.S.
dollar terms;
(x) Monitor the expense accruals and notify an officer
of the Fund of any proposed adjustments;
(xi) Control all disbursements and authorize such
disbursements from the Fund's account with the
custodian(s) upon Written Instructions;
(xii) Calculate capital gains and losses;
(xiii) Determine net income;
(xiv) Determine applicable foreign exchange gains and
losses on payables and receivables;
(xv) Obtain monthly security market quotes and currency
exchange rates from independent pricing sources
approved by the Adviser, or if such quotes are
unavailable, then obtain such prices from the
Adviser, and in either case calculate the market
value of the Fund's investments in accordance with
the applicable valuation policies or guidelines
provided by the Fund to PFPC and acceptable to PFPC;
(xvi) Transmit a copy of the monthly portfolio valuation
to the Adviser;
(xvii) Compute net asset value; and
(xviii) As appropriate, compute yields, total return,
expense ratios, portfolio turnover rate, and, if
required, portfolio average dollar weighted
maturity.
15. Description of Administration Services on a Continuous Basis. PFPC
will perform the following administration services:
(i) Prepare monthly security transaction listings;
(ii) Supply various normal and customary portfolio and
Fund statistical data as requested on an ongoing
basis;
(iii) Prepare for execution and file the Fund's Federal
and state tax returns: prepare a fiscal tax
provision in coordination with the annual audit;
prepare an excise tax provision; and prepare all
relevant 1099 calculations;
(iv) Coordinate contractual relationships and
communications between the Fund and its contractual
service providers;
(v) Coordinate printing of the Fund's annual and
semi-annual shareholder reports;
(vi) Prepare income and capital gain distributions;
(vii) Prepare the semiannual and annual financial
statements;
(viii) Monitor the Fund's compliance with IRC, SEC and
prospectus requirements;
(ix) Prepare, coordinate with the Fund's counsel and
coordinate the filing with the SEC: Post-Effective
Amendments to the Fund's Registration Statement and
supplements to or revisions of the Fund's prospectus
and statement of additional information; Quarterly
Repurchase Offer Filings on Form N-23c-3;
semi-annual reports on Form N-SAR and Form N-CSR;
Form N-Q; and Form N-PX based upon information
provided by Highland (for an additional fee);
(x) Assist in the preparation of notices of meetings of
shareholders and proxy materials relating to such
meetings;
(xi) Assist in obtaining the fidelity bond and directors'
and officers'/errors and omissions insurance
policies for the Fund in accordance with the
requirements of Rule 17g-1 and 17d-1(d)(7) under the
1940 Act as such bond and policies are approved by
the Fund's Board of Directors;
(xii) Monitor the Fund's assets to assure adequate
fidelity bond coverage is maintained;
(xiii) Draft agendas and resolutions for quarterly and
special board meetings;
(xiv) Coordinate the preparation, assembly and mailing of
board materials;
(xv) Attend board meetings and draft minutes thereof;
(xvi) Maintain the Fund's corporate calendar to assure
compliance with various filing and board approval
deadlines;
(xvii) Assist the Fund in the handling of SEC examinations
and responses thereto; and
(xviii) If the chief executive officer or chief financial
officer of the Fund is required to provide a
certification as part of the Fund's Form N-CSR or
Form N-Q filing pursuant to regulations promulgated
by the SEC under Section 302 of the Xxxxxxxx-Xxxxx
Act of 2002, PFPC will provide (to such person or
entity as agreed between the Fund and PFPC) a
sub-certification in support of certain matters set
forth in the aforementioned certification, such
sub-certification to be in such form and relating to
such matters as agreed between the Fund and PFPC
from time to time. PFPC shall be required to provide
the sub-certification only during the term of the
Agreement and only if it receives such cooperation
as it may request to perform its investigations with
respect to the sub-certification. For clarity, the
sub-certification is not itself a certification
under the Xxxxxxxx-Xxxxx Act of 2002 or under any
other regulatory requirement; and
(xix) Perform such additional administrative duties
relating to the administration of the Fund as may
subsequently be agreed upon in writing between the
Fund and PFPC.
16. Duration and Termination. This Agreement shall continue until
terminated by the Fund or by PFPC on sixty (60) days' prior written
notice to the other party. In the event the Fund gives notice of
termination, all expenses associated with movement (or duplication) of
records and materials and conversion thereof to a successor accounting
services agent (and any other service provider(s)), and all trailing
expenses incurred by PFPC, will be borne by the Fund.
17. Notices. Notices shall be addressed (a) if to PFPC, at 000 Xxxxxxxx
Xxxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000, Attention: President; (b) if to
the Fund, at 00000 Xxxx Xxxx, Xxxxx 0000, Xxxxxx, Xxxxx 00000,
Attention: Secretary of the foregoing, at such other address as shall
have been given by like notice to the sender of any such notice by the
other party. If notice is sent by confirming telegram, cable, telex or
facsimile sending device, it shall be deemed to have been given
immediately. If notice is sent by first-class mail, it shall be deemed
to have been given three days after it has been mailed. If notice is
sent by messenger, it shall be deemed to have been given on the day it
is delivered.
18. Amendments. This Agreement, or any term thereof, may be changed or
waived only by a written amendment, signed by the party against whom
enforcement of such change or waiver is sought.
19. Delegation; Assignment; Sub-Contracting. This Agreement and the rights
and duties of the parties herein may not be assigned or delegated by
any party without the written consent of each party.
20. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
21. Further Actions. Each party agrees to perform such further acts and
execute such further documents as are necessary to effectuate the
purposes hereof.
22. Miscellaneous.
(a) Entire Agreement. This Agreement embodies the entire
agreement and understanding between the parties and
supersedes all prior agreements and understandings
relating to the subject matter hereof, provided that
the parties may embody in one or more separate
documents their agreement, if any, with respect to
delegated duties and Oral Instructions.
(b) Captions. The captions in 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.
(c) Governing Law. This Agreement shall be deemed to be
a contract made in Delaware and governed by Delaware
law, without regard to principles of conflicts of
law.
(d) Partial Invalidity. If any provision of this
Agreement shall be held or made invalid by a court
decision, statute, rule or otherwise, the remainder
of this Agreement shall not be affected thereby.
(e) Successors and Assigns. This Agreement shall be
binding upon and shall inure to the benefit of the
parties hereto and their respective successors and
permitted assigns.
(f) Facsimile Signatures. The facsimile signature of any
party to this Agreement shall constitute the valid
and binding execution hereof by such party.
(g) The Fund will provide such information and
documentation as PFPC may reasonably request in
connection with services provided by PFPC to the
Fund.
(h) To help the U.S. government fight the funding of
terrorism and money laundering activities, U.S.
Federal law requires each financial institution to
obtain, verify, and record certain information that
identifies each person who initially opens an
account with that financial institution on or after
October 1, 2003. Certain of PFPC and certain of its
affiliates are financial institutions, and PFPC may,
as a matter of policy, request (or may have already
requested) the Fund's name, address and taxpayer
identification number or other government-issued
identification number, and, if such party is a
natural person, that party's date of birth. PFPC may
also ask (and may have already asked) for additional
identifying information, and PFPC may take steps
(and may have already taken steps) to verify the
authenticity and accuracy of these data elements.
(i) It is expressly agreed that the obligations of the
Fund under this Agreement shall not be binding upon
any past, present or future trustee, nominee,
officer, shareholder, employee or agent of the Fund
individually, and shall only be binding upon the
Fund and its assets, as provided in the Fund's
Amended and Restated Agreement and Declaration of
Trust, a copy of which is on file at the office of
the Secretary of the Commonwealth of Massachusetts
and at the principal offices of the Fund. This
Agreement was executed on behalf of the Fund by an
officer of the Fund in such capacity, and shall not
be deemed to have been executed by such officer
individually or to impose any liability on such
officer, or the shareholders of the Fund,
personally, but shall bind only the assets and
property of the Fund.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed as of the day and year first above written.
PFPC INC.
By: /s/ Xxxx X. Xxxxxxx
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Title: Senior Vice President
RESTORATION OPPORTUNITIES FUND
By: /s/ R. Xxxxxx Xxxxxxxxx
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Title: President
AUTHORIZED PERSONS APPENDIX
NAME (Type) SIGNATURE
Xxxxx Xxxxxxx
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Xxxxxxxxx Xxxxxx
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Xxxxxx Xxxxxx
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Xxxx Paris
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Xxxx Xxxxxxx
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Xxxx X. Xxxxx
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M. Xxxxx Xxxxxxxxx
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R. Xxxxxx Xxxxxxxxx
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