ARK FUNDS
ADMINISTRATION AGREEMENT
AGREEMENT made as of the 1st day of January, 2002, by and between ARK
Funds, a Massachusetts business trust, with its principal office and place of
business at Two Xxxxxxxx Xxxxxx, Xxxxxxxx, Xxxxx 00000 (the "Trust"), and
Allfirst Trust Company N.A., a national banking association organized under the
laws of the United States, with offices at 00 Xxxxx Xxxxxxx Xxxxxx, M/C 101-621,
Xxxxxxxxx, Xxxxxxxx 00000 ("Allfirst").
WHEREAS, the Trust is registered under the Investment Company Act of
1940, as amended ("1940 Act"), as an open-end management investment company; and
WHEREAS, the Trust may issue its shares of beneficial interest
("Shares"), in separate series and classes; and
WHEREAS, the Trust offers Shares in various series as listed in
Appendix A hereto (each such series, together with all other series subsequently
established by the Trust and made subject to this Agreement in accordance with
Section 7, being herein referred to as a "Fund," and collectively as the
"Funds") and the Trust offers Shares of various classes of each Fund as listed
in Appendix A hereto (each such class together with all other classes
subsequently established by the Trust in a Fund being herein referred to as a
"Class," and collectively as the "Classes"); and
WHEREAS, the Trust desires that Allfirst act as administrator of the
Trust and Allfirst is willing to serve as administrator of the Trust on the
terms and conditions set forth in this Agreement; and
WHEREAS, Allfirst has entered into a sub-administration agreement with
Forum Administrative Services, LLC ("Forum"), whereby Forum has agreed to
perform certain of the services to be performed by Allfirst hereunder;
NOW THEREFORE, for and in consideration of the mutual covenants and
agreements contained herein, the Trust and Allfirst hereby agree as follows:
SECTION 1. APPOINTMENT; DELIVERY OF DOCUMENTS
(a) The Trust hereby appoints Allfirst, and Allfirst hereby agrees to
act, as administrator of the Trust for the period and on the terms set forth in
this Agreement.
(b) In connection therewith, the Trust has delivered to Allfirst copies
of: (i) the Trust's declaration of trust and bylaws (collectively, as amended
from time to time, "Organic Documents"); (ii) the Trust's registration statement
and all amendments thereto filed with the U.S. Securities and Exchange
Commission ("SEC") pursuant to the Securities Act of 1933, as amended (the
"Securities Act"), or the 1940 Act (the "Registration Statement"); (iii) the
Trust's current prospectus and statement of additional information of each Fund
(collectively, as
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currently in effect and as amended or supplemented, the "Prospectus"); (iv) each
plan of distribution or similar document adopted by the Trust under Rule 12b-1
under the 1940 Act ("Plan") and each current shareholder service plan or similar
document adopted by the Trust ("Service Plan"); and (v) all procedures adopted
by the Trust with respect to the Funds (e.g., repurchase agreement procedures),
and shall promptly furnish Allfirst with all amendments of or supplements to the
foregoing.
SECTION 2. DUTIES OF ALLFIRST
(a) Subject to the direction and control of the Board of Trustees of
the Trust (the "Board"), Allfirst shall manage all aspects of the Trust's
operations with respect to the Funds except for those aspects that are the
responsibility of any other service provider hired by the Trust, all in such
manner and to such extent as may be authorized by the Board.
(b) With respect to the Trust or each Fund, as applicable, Allfirst or
its designee shall:
(i) at the Trust's expense, provide the Trust with, or arrange for the
provision of, the services of persons competent to perform such legal,
administrative, and clerical functions not otherwise described in this
Section 2(b) as are necessary to provide effective operation of the
Trust and maintain internal controls, audit programs, and periodic
reviews to ensure the continued effectiveness and sufficiency of the
services provided;
(ii) oversee (A) the preparation and maintenance by the Trust's
custodian, transfer agent, dividend disbursing agent, and fund
accountant, in such form, for such periods, and in such locations as
may be required by applicable United States law, of all documents and
records relating to the operation of the Trust required to be prepared
or maintained by the Trust or its agents pursuant to applicable law;
(B) the reconciliation of account information and balances among the
Trust's custodian, transfer agent, dividend disbursing agent, and fund
accountant; (C) the transmission of purchase and redemption orders for
Shares; and (D) the performance of fund accounting, including, without
limitation, the calculation of the net asset value of the Shares;
(iii) oversee the performance of administrative and professional
services rendered to the Trust by others, including its custodian,
transfer agent, and dividend disbursing agent as well as legal,
auditing, shareholder servicing, and other services performed for the
Funds;
(iv) provide the Trust with adequate general office space and
facilities and provide persons suitable to the Board to serve as
officers of the Trust;
(v) with the cooperation of the Trust's investment advisers, the
officers of the Trust, and other relevant parties, prepare and
disseminate materials for meetings of the Board, as applicable,
including a general report to the Board covering the Trust's
operations;
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(vi) file or oversee the filing of each document required to be filed
by the Trust in either written or, if required, electronic format
(e.g., electronic data gathering analysis and retrieval system or
"XXXXX") with the SEC, state, and other authorities as may be
necessary to enable the Trust to make a continuous offering of its
Shares;
(vii) assist in and oversee the preparation, filing, printing, and
periodic updating of the Registration Statement and Prospectuses;
(viii) assist in and oversee the preparation and printing of proxy and
information statements and related communications to shareholders;
(ix) assist the Trust's investment advisers and other appropriate
persons with respect to regulatory compliance matters, such assistance
to include, without limitation, the daily performance of and reporting
on the tests listed on Schedule 2(b)(ix) hereto and such other tests
as the Trust's investment advisers may reasonably request from time to
time;
(x) prepare, file, and maintain the Trust's Organic Documents and
minutes of meetings of the Board, Board committees, and shareholders;
(xi) maintain the Trust's existence and good standing under applicable
state law;
(xii) monitor sales of Shares, ensure that the Shares are properly and
duly registered with the SEC, and register, or prepare applicable
filings with respect to, the Shares with the various state and other
securities commissions;
(xiii) advise the Trust and the Board on matters concerning the Trust
and its legal, regulatory, and financial affairs;
(xiv) assist the Trust in the selection of other service providers,
such as independent accountants, law firms, and proxy solicitors;
(xv) calculate, review, and account for Fund expenses and report on
Fund expenses on a periodic basis;
(xvi) authorize the payment of Trust expenses and pay, from Trust
assets, all bills of the Trust;
(xvii) prepare Fund budgets, pro-forma financial statements, expense
and profit/loss projections, and fee waiver/expense reimbursement
projections on a periodic basis;
(xviii) prepare financial statement expense information;
(xix) request any necessary information from the Trust's transfer
agent, fund accountant, investment advisers, and distributor in order
to prepare, and prepare, the Trust's Form N-SAR twice a year and any
required financial data schedules;
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(xx) prepare semi-annual financial statements and oversee the
production of the semi-annual financial statements and any related
report to the Trust's shareholders prepared by the Trust or its
investment advisers, as applicable;
(xxi) file the Funds' semi-annual financial statements with the SEC or
ensure that the Funds' semi-annual financial statements are filed with
the SEC and oversee the distribution of the financial statements to
shareholders;
(xxii) produce quarterly compliance reports for the Board;
(xxiii) calculate data with respect to yields, dividend yields,
distribution rates, and total returns for dissemination to information
services covering the investment company industry, for advertising and
sales literature of the Trust and other appropriate purposes;
(xxiv) report Fund data to investment company industry survey
companies (e.g., Lipper Inc.);
(xxv) maintain CUSIP, ticker, news media, and tax identification
number listings;
(xxvi) report applicable data to rating agencies (such as Standard &
Poor's) that rate a Fund;
(xxvii) supervise the declaration of dividends and other distributions
to shareholders and prepare and distribute to appropriate parties
notices announcing the declaration of dividends and other
distributions to shareholders;
(xxviii) prepare Federal income and excise tax work papers and
provisions;
(xxix) cause to be prepared or prepare, execute (as an officer of the
Trust), and file all Federal income and excise tax returns and state
income and other tax returns, including any extensions or amendments,
each as agreed between the Trust and Allfirst;
(xxx) calculate required Fund distributions to maintain the
qualification of each Fund as a regulated investment company under the
Internal Revenue Code of 1986, as amended (the "Code"), and avoid, if
applicable, Federal excise tax;
(xxxi) perform other tax compliance and related reporting (including
but not limited to calculation of Code Section 851(b) "good income"
and "diversification" testing, reporting the tax status of
distributions, and preparing year-end Federal tax notice data);
(xxxii) prepare financial statement tax provisions (including but not
limited to sixty (60) day shareholder tax notice disclosure, tax
related footnotes, and Statement of Position 95-3 ("ROCSOP")
adjustments);
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(xxxiii) calculate income distributions for Funds that declare income
distributions more often than annually but not daily and calculate
capital gain distributions (in addition to typical calendar year-end
capital gain distributions);
(xxxiv) perform monthly capital gain analyses based on book numbers
adjusted for prior year unpaid spillback distribution requirements and
capital loss carryforwards; and
(xxxv) maintain appropriate insurance in light of its responsibilities
hereunder, and, at the expense of the Trust and subject to limits,
deductibles, and premiums as may be acceptable to the Trust, procure
appropriate insurance for the Trust and the trustees.
(c) Allfirst shall provide such other services and assistance relating
to the affairs of the Trust as are set forth in Appendix C hereto, and, pursuant
to mutually acceptable compensation and implementation agreements, such other
matters as the Trust may, from time to time, reasonably request.
(d) Allfirst shall maintain records relating to its services, such as
journals, ledger accounts and other records, as are required to be maintained
under the 1940 Act and Rule 31a-1 thereunder and any successor laws, rules or
industry standards. The books and records pertaining to the Trust that are in
possession of Allfirst or its designee shall be the property of the Trust. The
Trust or the Trust's authorized representatives shall have access to such books
and records at all times during the normal business hours of Allfirst or its
designee as applicable. Upon the reasonable request of the Trust, Allfirst shall
provide copies of any such books and records promptly to the Trust or the
Trust's authorized representatives at the Trust's expense.
(e) Nothing contained herein shall be construed to require Allfirst to
perform any service that could cause Allfirst to be deemed an investment adviser
for purposes of the 1940 Act or the Investment Advisers Act of 1940, as amended,
or that could cause a Fund to act in contravention of its Prospectus or any
provision of the 1940 Act.
SECTION 3. STANDARD OF CARE; LIMITATION OF LIABILITY; INDEMNIFICATION
(a) Allfirst shall be under no duty to take any action except as
specifically set forth herein or as may be specifically agreed to by Allfirst in
writing. Allfirst shall use its best judgment and efforts in rendering the
services described in this Agreement. Allfirst shall not be liable to the Trust
or any of the Trust's shareholders for any action or inaction of Allfirst
relating to any event whatsoever in the absence of bad faith, willful
misfeasance, or gross negligence in the performance of Allfirst's duties or
obligations under this Agreement or by reason of Allfirst's reckless disregard
of its duties and obligations under this Agreement.
(b) The Trust agrees to indemnify and hold harmless Allfirst, its
employees, agents, directors, officers, and managers and any person who controls
Allfirst within the meaning of section 15 of the Securities Act or section 20 of
the Securities Exchange Act of 1934, as amended (the "1934 Act") ("Allfirst
Indemnitees"), against and from any and all claims,
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demands, actions, suits, judgments, liabilities, losses, damages, costs,
charges, reasonable counsel fees, and other expenses of every nature and
character arising out of or in any way related to Allfirst's actions taken or
failures to act with respect to a Fund taken (or not taken, as the case may be)
in the absence of bad faith, willful malfeasance, and negligence or based, if
applicable, on good faith reliance upon an item described in Section 3(c) (an
"Allfirst Claim"). The Trust shall not be required to indemnify any Allfirst
Indemnitee if, prior to confessing any Allfirst Claim against the Allfirst
Indemnitee, Allfirst or the Allfirst Indemnitee does not give the Trust written
notice of and reasonable opportunity to defend against the Allfirst Claim in its
own name or in the name of the Allfirst Indemnitee.
(c) An Allfirst Indemnitee shall not be liable for any action taken or
failure to act in good faith reliance upon:
(i) the advice of counsel, who may be counsel to the Trust or Allfirst;
(ii) any oral or electronic instruction which it receives and which it
reasonably believes in good faith was transmitted by a person or
persons authorized by the Trust or the Board to give such instruction.
Provided that Allfirst has such reasonable belief, Allfirst shall have
no duty or obligation to make any inquiry or effort of certification of
such instruction;
(iii) any written instruction of the Trust or persons authorized by the
Trust to give such instruction, or any certified copy of any resolution
of the Board, and Allfirst may rely upon the genuineness of any such
document or copy thereof reasonably believed in good faith by Allfirst
to have been validly executed; or
(iv) as to genuineness, any signature, instruction, request, letter of
transmittal, certificate, opinion of counsel, statement, instrument,
report, notice, consent, order, or other document reasonably believed
in good faith by Allfirst to be genuine and to have been signed or
presented by the Trust or other proper party or parties;
and no Allfirst Indemnitee shall be under any duty or obligation to inquire into
the validity or invalidity or authority or lack thereof of any statement, oral,
electronic, or written instruction, resolution, signature, request, letter of
transmittal, certificate, opinion of counsel, instrument, report, notice,
consent, order, or any other document or instrument which Allfirst reasonably
believes in good faith to be genuine.
(d) Allfirst shall not be liable for the errors of other service
providers to the Trust or their systems, including errors in information
provided by an investment adviser (including prices and pricing formulas and the
untimely transmission of trade information), custodian, or transfer agent to the
Trust.
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SECTION 4. REPRESENTATIONS AND WARRANTIES
(a) Allfirst represents and warrants to the Trust that:
(i) It is a national banking association organized and existing and in
good standing under the laws of the United States;
(ii) It is empowered under applicable laws and by its charter and
bylaws to enter into this Agreement and perform its duties under this
Agreement;
(iii) All requisite corporate proceedings have been taken to authorize
it to enter into this Agreement and perform its duties under this
Agreement;
(iv) It has access to the necessary facilities, equipment, and
personnel to perform its duties and obligations under this Agreement;
and
(v) This Agreement, when executed and delivered, will constitute a
legal, valid, and binding obligation of Allfirst, enforceable against
Allfirst in accordance with its terms, subject to bankruptcy,
insolvency, reorganization, moratorium, and other laws of general
application affecting the rights and remedies of creditors and secured
parties.
(b) The Trust represents and warrants to Allfirst that:
(i) It is a business trust duly organized and existing and in good
standing under the laws of the Commonwealth of Massachusetts;
(ii) It is empowered under applicable laws and by its Organic
Documents to enter into this Agreement and perform its duties under
this Agreement;
(iii) All requisite corporate proceedings have been taken to authorize
it to enter into this Agreement and perform its duties under this
Agreement;
(iv) This Agreement, when executed and delivered, will constitute a
legal, valid, and binding obligation of the Trust, enforceable against
the Trust in accordance with its terms, subject to bankruptcy,
insolvency, reorganization, moratorium, and other laws of general
application affecting the rights and remedies of creditors and secured
parties; and
(v) A registration statement under the Securities Act is currently
effective and the Trust will use best efforts to cause the
registration statement to remain effective, and appropriate state
securities laws filings have been made and Allfirst will use best
efforts to cause the filings to continue to be made, with respect to
all Shares of the Funds and Classes of the Trust being offered for
sale.
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SECTION 5. COMPENSATION AND EXPENSES
(a) In consideration of the administrative services provided by
Allfirst pursuant to this Agreement, the Trust shall pay or cause to be paid to
Allfirst, with respect to each Class of each Fund, the fees set forth in
Appendix B hereto.
All fees payable hereunder shall be accrued daily. The Base Fees shall
be payable monthly in advance on the third business day of each calendar month
for services performed during the following calendar month. The Asset Charge
shall be payable monthly in arrears on the third business day of each calendar
month for services performed during the preceding calendar month. Reimbursements
as described in Section 5(b) shall be payable monthly in arrears on the third
day of each calendar month for services performed during the prior calendar
month. If fees begin to accrue in the middle of a month or if this Agreement
terminates before the end of any month, all fees for the period from that date
to the end of that month or from the beginning of that month to the date of
termination, as the case may be, shall be prorated according to the proportion
that the period bears to the full month in which the effectiveness or
termination occurs. Upon the termination of this Agreement with respect to a
Fund, the Trust shall pay to Allfirst such compensation as shall be payable
prior to the effective date of termination.
In the event that any of the services identified in Appendix C hereto
are provided by personnel of the legal department of Forum, they will be
provided at no additional charge to the Trust except those matters designated as
Special Legal Services, as to which Allfirst may charge, and the Trust shall pay
an additional amount as reimbursement of Allfirst's cost of Forum providing such
services. Reimbursement shall be payable monthly in arrears on the first day of
each calendar month for services performed under this Agreement during the prior
calendar month.
(b) In connection with the services provided by Allfirst pursuant to
this Agreement, the Trust, on behalf of each Fund, agrees to reimburse Allfirst
for the expenses set forth in clause (iii) of Appendix B hereto. In addition,
the Trust shall reimburse Allfirst for all reasonably incurred expenses and
employee time of Forum attributable to any review of the Trust's accounts and
records by the Trust's independent accountants or any regulatory body outside of
routine and normal periodic reviews.
(c) Notwithstanding anything in this Agreement to the contrary,
Allfirst and its affiliated persons may receive compensation or reimbursement
with respect to: (i) the provision of services on behalf of the Funds in
accordance with any Plan or Service Plan; (ii) the provision of shareholder
support or other services; (iii) service as a trustee or officer of the Trust;
and (iv) services to the Trust, which may include the types of services
described in this Agreement, with respect to the creation of any Fund and the
start-up of the Fund's operations.
(d) The Trust shall be responsible for and assumes the obligation for
payment of all of its expenses, including: (i) the fee payable under this
Agreement; (ii) the fees payable to each investment adviser under an agreement
between the investment adviser and the Trust; (iii)
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expenses of issue, repurchase, and redemption of Shares; (iv) interest charges,
taxes, and brokerage fees and commissions; (v) premiums of insurance for the
Trust, the trustees and officers and fidelity bond premiums; (vi) fees, interest
charges, and expenses of third parties, including the Trust's independent
accountants, custodians, transfer agents, dividend disbursing agents, and fund
accountants; (vii) fees of pricing, interest, dividend, credit, and other
reporting services; (viii) costs of membership in trade associations; (ix)
telecommunications expenses; (x) funds transmission expenses; (xi) auditing,
legal, and compliance expenses; (xii) costs of forming the Trust and maintaining
its existence; (xiii) costs of preparing, filing, and printing the Trust's
Prospectuses, subscription application forms, and shareholder reports and other
communications and delivering them to existing shareholders, whether of record
or beneficial; (xiv) expenses of meetings of shareholders and proxy
solicitations therefor; (xv) costs of maintaining books of original entry for
portfolio and fund accounting and other required books and accounts, of
calculating the net asset value of Shares and of preparing tax returns; (xvi)
costs of reproduction, stationery, supplies, and postage; (xvii) fees and
expenses of the Trust's trustees and officers; (xviii) costs of other personnel
(who may be employees of the investment adviser, Allfirst, or their respective
affiliated persons) performing services for the Trust; (xix) costs of Board,
Board committee, and other corporate meetings; (xx) SEC registration fees and
related expenses; (xxi) state, territory, or foreign securities laws
registration fees and related expenses; and (xxii) all fees and expenses paid by
the Trust in accordance with any Plan or Service Plan or agreement related to
similar manners.
SECTION 6. EFFECTIVENESS, DURATION, TERMINATION, AND ASSIGNMENT
(a) This Agreement shall become effective on the date hereof and, with
respect to each new Fund or Class referred to in Section 7, on the earlier of
date on which the Trust's Registration Statement relating to the Shares of such
Fund or Class becomes effective or the date of the commencement of operations of
the Fund or Class.
(b) This Agreement shall continue in effect with respect to each Fund
and Class until December 31, 2002 (the "Initial Term") and shall continue in
effect thereafter for successive one-year periods unless earlier terminated in
accordance with this Section or until the Fund or Class ceases operations.
(c) In the event that the Trust elects to terminate this Agreement
prior to December 31, 2004, pursuant to this Section 6, the Trust shall pay
Allfirst twelve (the "multiplier") times the monthly average fees due to
Allfirst under this Agreement ("Termination Fee") (calculated based on the last
three months prior to the date of termination). The multiplier shall be reduced
one-twelfth for each full calendar quarter after December 31, 2001 that expires.
The Termination Fee shall be due as of the last day this Agreement is effective.
(d) This Agreement may be terminated with respect to any or all Funds
at any time after the date that is 90 days prior to the expiration of the
Initial Term, (i) by the Trust on 90 days' written notice to Allfirst or (ii) by
Allfirst on 90 days' written notice to the Trust.
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(e) The provisions of Sections 2(d), 3, 5, 6(d), 6(e), 8, 9, 10, 12,
and 13 shall survive any termination of this Agreement.
(f) All terms and provisions of this Agreement shall be binding upon,
inure to the benefit of, and be enforceable by the respective successors and
assigns of the parties hereto.
(g) This Agreement and the rights and duties under this Agreement may
not be assigned by either party except by the specific written consent of the
other party.
SECTION 7. ADDITIONAL FUNDS AND CLASSES
In the event that the Trust establishes one or more series of Shares or
one or more classes of Shares after the effectiveness of this Agreement, such
series of Shares or classes of Shares, as the case may be, automatically shall
become Funds and Classes under this Agreement and the fees applicable to new
Funds and Classes as provided in Appendix B will apply. Allfirst or the Trust
may elect not to make any such series or classes subject to this Agreement.
SECTION 8. CONFIDENTIALITY
Allfirst agrees to treat all records and other information related to
the Trust as proprietary information of the Trust and, on behalf of itself and
its employees, to keep confidential all such information, except that Allfirst
may:
(a) prepare or assist in the preparation of periodic reports to
shareholders and regulatory bodies such as the SEC;
(b) provide information typically supplied in the investment company
industry to companies that track or report price, performance, or other
information regarding investment companies; and
(c) release such other information as approved by the Trust, which
approval shall not be unreasonably withheld and may not be withheld where
Allfirst is advised by counsel that it may be exposed to civil or criminal
contempt proceedings for failure to release the information (provided, however,
that Allfirst shall seek the approval of the Trust as promptly as possible so as
to enable the Trust to pursue such legal or other action as it may desire to
prevent the release of such information) or when so requested by the Trust.
SECTION 9. FORCE MAJEURE
Allfirst 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 reasonable control
including, without limitation, acts of civil or military authority, national
emergencies, labor difficulties, fire, mechanical or other breakdown of the
securities markets, flood or catastrophe, acts of God, insurrection, war,
terrorism, riots, or failure of the mails, transportation, communication, or
power supply. In addition, to the extent
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Allfirst's obligations hereunder are to oversee or monitor the activities of
third parties, Allfirst shall not be liable for any failure or delay in the
performance of Allfirst's duties caused, directly or indirectly, by the failure
or delay of such third parties in performing their respective duties or
cooperating reasonably and in a timely manner with Allfirst.
SECTION 10. DISASTER RECOVERY
Allfirst shall enter into and shall maintain in effect with appropriate
parties one or more agreements making reasonable provisions for periodic backup
of computer files and data with respect to the Trust and emergency use of
electronic data processing equipment. In the event of equipment failures,
Allfirst shall, at no additional expense to the Trust, take reasonable steps to
minimize service interruptions. Allfirst 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 Allfirst's own willful misfeasance,
bad faith, gross negligence, or reckless disregard of its duties or obligations
under this Agreement and provided further that Allfirst has complied with the
provisions of this Section 10.
SECTION 11. ACTIVITIES OF ALLFIRST
(a) Except to the extent necessary to perform Allfirst's obligations
under this Agreement, nothing herein shall be deemed to limit or restrict
Allfirst's right, or the right of any of Allfirst's directors, officers, or
employees who also may be a trustee, officer, or employee of the Trust, or
persons who are otherwise affiliated persons of the Trust to engage in any other
business or to devote time and attention to the management or other aspects of
any other business, whether of a similar or dissimilar nature, or to render
services of any kind to any other corporation, trust, firm, individual, or
association.
(b) Allfirst may subcontract any or all of its functions or
responsibilities pursuant to this Agreement to one or more persons, which may be
affiliated persons of Allfirst, who agree to comply with the terms of this
Agreement; provided, that any such subcontracting shall not relieve Allfirst of
its responsibilities hereunder. Allfirst may pay those persons for their
services, but no such payment will increase Allfirst's compensation or
reimbursement of expenses from the Trust.
SECTION 12. COOPERATION WITH INDEPENDENT ACCOUNTANTS
Allfirst shall cooperate, if applicable, with each Fund's independent
public accountants and shall take reasonable action to make all necessary
information available to the accountants for the performance of the accountants'
duties.
SECTION 13. LIMITATION SHAREHOLDER AND TRUSTEE LIABILITY
The trustees, officers, employees and agents of the Trust and the
shareholders of each Fund shall not be liable for any obligations of the Trust
or of the Funds under this Agreement, and Allfirst agrees that, in asserting any
rights or claims under this Agreement, it shall look only
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to the assets and property of the Trust or the Fund to which its rights or
claims relate in settlement of such rights or claims, and not to the trustees,
officers, employees and agents of the Trust or the shareholders of the Funds.
SECTION 14. PRIVACY AND SECURITY OF NON-PUBLIC PERSONAL INFORMATION
Allfirst acknowledges and agrees that certain information made
available to it hereunder may be deemed non-public personal information under
the Xxxxx-Xxxxx-Xxxxxx Act, other federal or state privacy laws (as amended),
and the rules and regulations promulgated thereunder (collectively, the "Privacy
Laws"). Allfirst hereby agrees (i) not to disclose or use such information
except as required to carry out it duties under this Agreement or as otherwise
permitted by law in its ordinary course of business, (ii) to establish and
maintain procedures reasonably designed to assure the security and privacy of
all such information, and (iii) to cooperate with the Trust and provide
reasonable assistance in ensuring compliance with such Privacy Laws to the
extent applicable to it.
SECTION 15. MISCELLANEOUS
(a) Neither party to this Agreement shall be liable to the other party
for consequential damages under any provision of this Agreement, even if such
party is advised of the possibility of such damages.
(b) Except for Appendix A to add new Funds and Classes in accordance
with Section 7, no provisions of this Agreement may be amended or modified in
any manner except by a written agreement properly authorized and executed by
both parties hereto.
(c) This Agreement shall be governed by, and the provisions of this
Agreement shall be construed and interpreted under and in accordance with, the
laws of the State of Delaware.
(d) This Agreement constitutes the entire agreement between the parties
hereto and supersedes any prior agreement with respect to the subject matter
hereof, whether oral or written.
(e) This Agreement may be executed by the parties hereto on any number
of counterparts, and all of the counterparts taken together shall be deemed to
constitute one and the same instrument.
(f) If any part, term, or provision of this Agreement is held to be
illegal, in conflict with any law, or otherwise invalid, the remaining portion
or portions shall be considered severable and not be affected, and the rights
and obligations of the parties shall be construed and enforced as if the
Agreement did not contain the particular part, term, or provision held to be
illegal or invalid. This Agreement shall be construed as if drafted jointly by
both Allfirst and the Trust and no presumptions shall arise favoring any party
by virtue of authorship of any provision of this Agreement.
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(g) Section headings in this Agreement are included for convenience
only and are not to be used to construe or interpret this Agreement.
(h) Notices, requests, instructions, and communications received by the
parties at their respective principal places of business, or at such other
address as a party may have designated in writing, shall be deemed to have been
properly given.
(i) Nothing contained in this Agreement is intended to or shall require
Allfirst, in any capacity hereunder, to perform any functions or duties on any
day other than a Fund business day. Functions or duties normally scheduled to be
performed on any day which is not a Fund business day shall be performed on, and
as of, the next Fund business day, unless otherwise required by law.
(j) Notwithstanding any other provision of this Agreement, the parties
agree that the assets and liabilities of each Fund are separate and distinct
from the assets and liabilities of each other Fund and that no Fund shall be
liable or shall be charged for any debt, obligation or liability of any other
Fund, whether arising under this Agreement or otherwise.
(k) No affiliated person, employee, agent, director, officer, or
shareholder of Allfirst shall be liable at law or in equity for Allfirst's
obligations under this Agreement.
(l) The terms "affiliated person" and "assignment" shall have the
meanings ascribed thereto in the 1940 Act.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in their names and on their behalf by and through their duly authorized
officers, as of the day and year first above written.
ARK FUNDS
By: /S/ XXXXXXX XXXXXX
-----------------------------------------
Name: Xxxxxxx Xxxxxx
Title: Vice President
ALLFIRST TRUST COMPANY N.A.
By: /S/ XXXX X. GOLD
-----------------------------------------
Name: Xxxx X. Gold
Title: CEO
-C13-
ARK FUNDS
SUB-ADMINISTRATION AGREEMENT
APPENDIX A
INCEPTION INCEPTION INCEPTION INCEPTION
DATE INSTITUTIONAL DATE RETAIL A DATE RETAIL B DATE
INSTITUTIONAL II
Money Market Port. X 6/14/93 X 7/21/95 X 3/2/94 X* 9/1/98
Govt. Money Market X 6/14/93 X 7/28/95 X 7/7/97
U.S.Treas. Money MKT. X 6/14/93 X 7/28/95 X 12/15/95
Tax-Free Money MKT. X 6/14/93 X 7/28/95 X 3/15/94
Pennsylvania Tax-Free Money X 5/1/01 X 5/1/01
MKT.
Short-Term X 3/20/96 X 9/9/96
Treasury
Short-Term Bond X 3/31/96
U.S. Gov't Bond X 3/31/96 X 4/1/98
Interm. Fixed Income X 11/15/96
Income X 7/16/93 X 4/12/94 X 9/1/98
Maryland Tax -Free X 11/15/96 X 1/2/97 X 9/1/99
Pennsylvania Tax-Free X 3/31/96 X 3/23/98 X 9/1/99
Balanced X 7/16/93 X 3/9/94 X 9/1/98
Equity Income X 11/15/96 X 5/9/97
Value Equity X 3/31/96 X 4/1/98 X 9/1/99
Equity X 10/1/97 X 11/3/97
Index
Blue Chip Equity X 4/1/96 X 5/16/96 X 7/1/98
Capital Growth X 7/16/93 X 3/9/94 X 9/1/98
Mid-Cap Equity X 11/15/96 X 9/1/99
Small-Cap Equity X 7/13/95 X 5/16/96 X 2/19/01
Int'l Equity X 3/31/97 X 4/1/98
Emerging Markets X 1/7/92
Social Issues Intermediate X 5/1/01
Fixed Income
Social Issues Blue Chip X 5/1/01
Equity
Social Issues Capital Growth X 5/1/01
Social Issues Small Cap X 5/1/01
Equity
TOTAL 25 5 19 9
* For exchange purposes only
CASH MANAGEMENT FUNDS
INCEPTION INCEPTION INCEPTION
CORPORATE DATE CORPORATE II DATE CORPORATE DATE
III
-C14-
U.S. Government Cash X 10/19/00 X 6/1/00 X 6/6/00
Management Money Market
U.S. Prime Cash Management X 7/28/00 X 6/5/00 X 8/16/00
Money Market
U.S. Treasury Cash X 7/21/00 X 10/6/00
Management Money Market
Tax-Free Cash Management X 6/23/00
Money Market
TOTAL 2 3 4
-C15-
ARK FUNDS
ADMINISTRATION AGREEMENT
APPENDIX B
FEES AND EXPENSES
(i) Base Fee:
FEE PER EXISTING FUND............................................................... $2,000/MONTH
FEE PER NEW FUND.................................................................... $1,000/MONTH*
(ii) Asset Charge (Fee as a % of the Annual Average Daily Net Assets of a Fund):
FEE PER FUND ....................................................................... 0.085%
(iii)....Private Label Broker Dealer Fee............................................ 5,000/month
(iv) Out-Of-Pocket and Related Expenses
Allfirst shall reimburse Forum for all out-of-pocket and ancillary
expenses in providing the services described in this Agreement, including but
not limited to the cost of (or appropriate share of the cost of): (i) postage
and delivery services; (ii) telephone services; (iii) electronic or facsimile
transmission services; (iv) reproduction; (v) printing and distributing
financial statements and prospectuses; (vi) typesetting, printing and
distributing financial statements and prospectuses; (vii) Blue Sky and other
regulatory filing fees; (viii) marketing material design and production; (ix)
microfilm and microfiche; (x) Trust record storage and retention fees; and (xi)
NASD and state fees and costs to maintain broker dealer. In addition, any other
expenses incurred by Forum at the request or with the consent of the Trust, will
be reimbursed by the Trust on behalf of the applicable Fund.
In addition, to the extent not set forth above, Allfirst shall pay the
out-of-pocket costs and expenses of Forum and ARK Funds Distributors, LLC: (i)
to obtain and maintain the registration of representatives with the NASD and the
various States; (ii) to investigate, defend or settle, or pay any fines
resulting from, any investigation or proceeding with respect to the activities
of any representative; (iii) to file advertising and sales literature with the
NASD and States, and subject to approval by the Trust, and to travel to the
offices of the investment adviser to conduct compliance meetings or inspections;
and (iv) mail or otherwise deliver the various filings and documents related to
representatives, including postage and money transmittal fees.
*For the first calendar year of each New Fund. Thereafter, the Base Fee
will be the same as that for an Existing Fund (i.e., $2,000 per month).
-C16-
ARK FUNDS
ADMINISTRATION AGREEMENT
APPENDIX C
General/Administration/Compliance Functions
1. Draft memos, checklists and procedures to comply with restrictions;
review procedures annually with the Board; Monitor for compliance with
procedures, and Review procedures annually if required:
o Liquidity Guidelines
o Rule 10f-3 (affiliated underwriting)
o Rule 17f-4 (municipal book-entry system)
o Rule 22c-1 (designating time of NAV)
o Rule 17a-7 (affiliated purchases/sales)
o Rule 17e-1 (affiliated brokerage)
o Rule 2a-7 (money market funds only)
o Rules 17f-5, 17f-7
o Rule 12b-1
o Rule 18f-3
o Prospectus Requirements
o Affiliated Bank Transactions
o Other 1940 Act/IRC/Prospectus Requirements
2. Maintain fund facts and files
3. Coordinate with the SEC with respect to inspection, comments on
registration statements
4. Coordinate with Fund Counsel
5. Coordinate with independent auditor and provide attorney letters if
requested
6. Coordinate with custodian and sub-custodian
7. Coordinate with advisor and sub-advisor
8. Coordinate with rating and publication agencies
9. Coordinate, and prepare and/or review contracts, with third party
vendors
10. Advise on 1940 Act issues, subject to advice of fund counsel
11. Advise on Blue Sky issues, subject to advice of fund counsel
12. Coordinate with independent auditors, and/or Allfirst internal audit,
review of the providers of:
o Advisory services
o Blue Sky services
o Custodian services
o Transfer Agency services
13. Draft, Review and/or File tax opinions or IRS Private Letter Rulings
14. Draft, Review and/or File exemptive applications
-C17-
15. Draft, Review and/or File N-SARs
16. Draft, Review and/or File De-registration Applications (N-8F)
17. Draft, Review and/or File Merger/Reorganization Documents (N-14)
18. Draft, Review and/or File SEC no-action requests
19. Advise on modifications to Fund Code of Ethics, as necessary
20. Assist Adviser with its Code of Ethics
21. Research securities, banking and ERISA regulatory issues either
directly or with outside counsel, particularly with conversion of bank
assets into proprietary funds
22. Counsel client on portfolio compliance issues (such as interpreting
Rule 2a-7, affiliated transaction restrictions, etc.)
23. Assist and counsel client on obtaining appropriate insurance for Fund
and Trustees
24. Coordinate seed money and establish control accounts for new funds
25. Coordinate the printing and mailing of all income breakdown data to
client services and transfer agent
26. Advise and coordinate new product initiatives
BOARD MEETINGS/BOARD MATERIALS
1. Coordinate Board Meeting calendar for the Funds
2. Prepare agenda, resolutions and related materials (including draft
materials)
3. Provide Fund Officers, as necessary
4. Attend Board Meetings (expenses incurred related to attendance at Board
Meetings are considered a Fund Expense)
5. Act as secretary and take minutes of meeting
6. Maintain matrix for contract renewals and termination
7. Coordinate responsibilities and deadlines for each item in each package
8. Create/maintain fee and expense comparison documentation (Lipper Data)
for section 15(c) review of contracts (annual or as needed)
9. Coordinate payment of Trustees' fees
10. Conduct meetings and draft minutes
-C18-
11. Produce operating/compliance reports
12. Collect and assemble adviser reports (Rule 10f-3, Rule 17a-7, and Rule
00x-0, Xxxx 0x-0, Xxxx 17f-4, etc.)
13. Coordinate auditors presentation
14. Coordinate presentation by custodian, including Rate 17f-5 and 17f-7
materials
15. Compile and maintain Trustee reference manual
CORPORATE RECORDS/SHAREHOLDER MEETINGS
1. Prepare Fund By-Laws
2. Prepare and distribute shareholder minutes and consents
3. Maintain Fund files within statutory guidelines and time limits
4. Maintain files for registration statements, prospectuses, SAIs,
financial statements and stickers
5. Prepare and obtain all executed "authorized signatures"
6. Maintain record book of all organizational documents, official records,
consents, approved minutes
7. Draft and/or Review proxy statements, shareholder meeting scripts, and
other proxy materials; conduct meetings
8. Oversee filing of proxy materials with regulatory authorities,
distribution to shareholders
9. Obtain corporate status documentation as needed
10. Coordinate printing, distribution and tabulation of proxies
AGREEMENTS/DOCUMENTS/PROCEDURES
1. Obtain signatures if needed (and file originals in Fund files)
2. Distribute to all appropriate parties
3. Maintain working copies, files and procedure manuals
4. Prepare Investment Advisory/Sub-Advisory Contract
5. Prepare Administration Contracts
6. Prepare Distribution Contracts
7. Prepare Rule 12b-1 Plans and Agreements
-C19-
8. Prepare Rule 18f-3 Plan
9. Prepare Shareholder Servicing Agreements
10. Prepare Fund Accounting, Custody and Transfer Agency Agreements, as
necessary
11. Provide forms of Repurchase Agreements to Advisor and assist as
necessary
12. Prepare Declaration of Trust for new Funds/classes (includes filing with
state authorities)
13. Prepare sub-transfer agency agreements and similar networking agreements
14. Provide any Fund records as requested by SEC examiner/Independent Auditor
REGISTRATION STATEMENTS
1. Draft, review and/or file prospectuses, SAIs and post-effective
amendments
2. Maintain all updates to prospectuses and SAIs
3. Draft, review and/or file prospectus supplements
4. Request/coordinate input from all sources
5. Coordinate auditor review and consent
6. Draft, review and/or file registration statement wrapper, including
Part C and all exhibits
7. File or oversee filing by XXXXX and paper if required
8. Draft correspondence to SEC and respond to SEC comments
9. Coordinate typeset/print of document
10. Distribute as appropriate
11. Coordinate with transfer agent, custodian, and fund accountant (as
appropriate) information for registration statements
-C20-
OTHER FILINGS
1. Prepare 24f-2 and 24(e) filings
2. File Form 12b-25, as necessary
3. Coordinate auditor consents for filing
4. File all financial statements
5. File all prospectuses, SAIs and amendments
6. Arrange payment of filing fees
SURVEY OVERSIGHT
1. Coordinate Government reporting surveys to Fund Accounting
2. Report Fund changes to Fund Accounting
NRSRO RATINGS/PERFORMANCE PUBLICATION
1. Obtain and maintain Fund NRSRO ratings
2. Coordinate all rating applications
3. Maintain Rating agency documentation
4. Follow-up any issues surrounding reporting of performance for the Funds
CUSIP/TIN/NASDAQ
1. Obtain CUSIPs and maintain master list
2. Obtain TINs and maintain master list
3. Obtain NASDAQ symbols and listings and maintain master list
DISTRIBUTION
1. Prepare compliance, expense and other reports to Board as requested
-C21-
2. Counsel, external and internal clients and business managers on regulatory,
financial, and disclosure aspects of sales contents, incentive programs and
related marketing materials
3. Maintain registered Fund distributor with NASD and States
4. Review and approve advertising and sales literature
5. File sales materials with regulatory authorities and maintain complete file
6. Monitor underwriters, code of ethics, xxxxxxx xxxxxxx and supervising
procedure compliance
7. Collect, process and pay sales loads
8. Collect, process and pay 12b-1 fees
9. Calculate any request on unreimbursed Rule 12b-1 fees
10. Prepare reports on distribution expenses
11. Maintain dealer, shareholder servicing and other agreements with financial
intermediaries
12. Execute required underwriter filings (i.e., Rule 461)
13. Report on internal code of ethics to Board
BLUE SKY MATTERS
1. Register the fund and its shares with appropriate blue sky authorities
2. Respond to all blue sky audit and examination issues
3. Perform blue sky fee analysis to minimize expenses
4. Perform sales reporting to states
5. Coordinate transfer agent interface and sales reporting
6. Maintain state eligibility lists
-C22-
