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EXHIBIT(d)(iii)(A)
THIRD PARTY FEEDER FUND
AGREEMENT
AMONG
AMR INVESTMENT SERVICES, INC.,
AMERICAN AADVANTAGE MILEAGE FUNDS,
EQUITY 500 INDEX PORTFOLIO
AND
BANKERS TRUST COMPANY
dated as of
February 28, 1998
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AGREEMENT
THIS AGREEMENT is made and entered into as of the 28th day of February,
1998, by and among AMR Investment Services, Inc. ("AMR"), American AAdvantage
Mileage Funds (the "Company"), a Massachusetts business trust, in respect of the
American AAdvantage S&P 500 Index Mileage Fund, a series thereof (the "Fund"),
Equity 500 Index Portfolio, a New York business trust (the "Portfolio"), and
Bankers Trust Company, a New York banking corporation (the "Adviser"), with
respect to the proposed investment by the Fund in the Portfolio.
WITNESSETH
WHEREAS, the Company and the Portfolio are each open-end management
investment companies and the Fund and the Portfolio have the same investment
objectives and substantively the same investment policies;
WHEREAS, the Adviser currently serves as the investment adviser of the
Portfolio;
WHEREAS, AMR currently serves as the investment manager of the Fund;
WHEREAS, neither AMR nor the Adviser currently serve as the principal
underwriter of the Fund;
WHEREAS, the Company desires to invest all of the Fund's investable
assets in the Portfolio in exchange for a beneficial interest in the Portfolio
(the "Investment") on the terms and conditions set forth in this Agreement;
WHEREAS, the Portfolio believes that accepting the Investment is in the
best interests of the Portfolio and that the interests of existing investors in
the Portfolio will not be diluted as a result of its accepting the Investment;
and
NOW, THEREFORE, in consideration of the foregoing, the mutual promises
herein made and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
ARTICLE I
THE INVESTMENT
1.1 Agreement to Effect the Investment. The Company agrees to
assign, transfer and deliver all of the Fund's investable assets (the "Assets")
to the Portfolio at each Closing (as hereinafter defined). The Portfolio agrees
in exchange therefor to issue to the Fund a beneficial interest (the "Interest")
in the Portfolio equal in value to the net value of the Assets of the Fund
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conveyed to the Portfolio on that date of Closing.
ARTICLE II
CLOSING AND CLOSING DATE
2.1 Time of Closing. The conveyance of the Assets in exchange for
the Interest, as described in Article I, together with related acts necessary to
consummate such transactions, shall occur initially on the date the Company
commences its offering of shares of the Fund to the public and at each
subsequent date as the Company desires to make a further Investment in the
Portfolio (each, a "Closing"). All acts occurring at any Closing shall be deemed
to occur simultaneously as of the last daily determination of the Portfolio's
net asset value on the date of Closing.
2.2 Related Closing Matters. On each date of Closing, the Company,
on behalf of the Fund, shall authorize the Fund's custodian to deliver all of
the Assets held by such custodian to the Portfolio's custodian. The Fund's and
the Portfolio's custodians shall acknowledge, in a form acceptable to the other
party, their respective delivery and acceptance of the Assets. The Portfolio
shall deliver to the Company acceptable evidence of the Fund's ownership of the
Interest. In addition, each party shall deliver to each other party such bills
of sale, checks, assignments, securities instruments, receipts or other
documents as such other party or its counsel may reasonably request. Each of the
representations and warranties set forth in Article III shall be deemed to have
been made anew on each date of Closing.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
3.1 The Company and AMR. The Company and AMR each represents and
warrants to the Portfolio and the Adviser that:
(a) Organization. The Company is a Massachusetts business trust
duly organized, validly existing and in good standing under
the laws of the Commonwealth of Massachusetts, the Fund is a
duly and validly designated series of the Company, and the
Company and the Fund have the requisite power and authority to
own their property and conduct their business as now being
conducted and as proposed to be conducted pursuant to this
Agreement.
(b) Authorization of Agreement. The execution and delivery of this
Agreement by the Company and the consummation of the
transactions contemplated hereby have been duly authorized by
all necessary action on the part of the Company and no other
action or proceeding is necessary for the execution and
delivery of this Agreement by the Company, the performance by
the Company of its obligations hereunder and the consummation
by the Company of the transactions contemplated hereby. This
Agreement has been duly executed and delivered by the Company
and constitutes a legal, valid and binding obligation of the
Company
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in respect of the Fund, enforceable against them in accordance
with its terms.
(c) Authorization of Investment. The Investment has been duly
authorized by all necessary action on the part of the Board of
Trustees of the Company.
(d) No Bankruptcy Proceedings. Neither the Company nor the Fund is
under the jurisdiction of a court in a proceeding under Title
11 of the United States Code (the "Bankruptcy Code") or
similar case within the meaning of Section 368(a)(3) (A) of
the Bankruptcy Code.
(e) Fund Assets. The Fund's Assets will, at the initial Closing,
consist solely of cash.
(f) Fiscal Year. The fiscal year end for the Fund is December 31.
(g) Auditors. The Company has appointed Coopers & Xxxxxxx LLP as
the Fund's independent public accountants to certify the
Fund's financial statements in accordance with Section 32 of
the Investment Company Act of 1940, an amended ("1940 Act").
(h) Registration Statement. The Company has reviewed the
Portfolio's registration statement on Form N-1A, as filed with
the Securities and Exchange Commission ("SEC"), and
understands and agrees to the Portfolio's policies and methods
of operation as described therein.
(i) Errors and Omissions Insurance Policy. The Company has in
force an errors and omissions liability insurance policy
insuring the Fund against loss up to $10 million for
negligence or wrongful acts.
(j) SEC Filings. The Company has duly filed all forms, reports,
proxy statements and other documents (collectively, the "SEC
Filings") required to be filed under the Securities Act of
1933, as amended (the "1933 Act"), the Securities Exchange Act
of 1934 (the "1934 Act") and the 1940 Act (collectively, the
"Securities Laws") in connection with the registration of its
shares, any meetings of its shareholders and its registration
as an investment company. The SEC Filings were prepared in
accordance with the requirements of the Securities Laws, as
applicable, and the rules and regulations of the SEC
thereunder, and do not contain any untrue statement of a
material fact or omit to state any material fact required to
be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they
were made, not misleading.
(k) 1940 Act Registration. The Company is duly registered as an
open-end management investment company under the 1940 Act and
the Fund and its shares are registered or qualified in any
states where such registration or qualification is
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necessary and such registrations or qualifications are in full
force and effect.
3.2 The Portfolio and the Adviser. The Portfolio and the Adviser
each represents and warrants to the Company and AMR that:
(a) Organization. The Portfolio is a business trust duly organized
and validly existing under the common law of the State of New
York and has the requisite power and authority to own its
property and conduct its business as now being conducted and
as proposed to be conducted pursuant to this Agreement.
(b) Authorization of Agreement. The execution and delivery of this
Agreement by the Portfolio and the consummation of the
transactions contemplated hereby have been duly authorized by
all necessary action on the part of the Portfolio by its Board
of Trustees and no other action or proceeding is necessary for
the execution and delivery of this Agreement by the Portfolio,
the performance by the Portfolio of its obligations hereunder
and the consummation by the Portfolio of the transactions
contemplated hereby. This Agreement has been duly executed and
delivered by the Portfolio and constitutes a legal, valid and
binding obligation of the Portfolio, enforceable against it in
accordance with its terms.
(c) Authorization of Issuance of Interest. The issuance by the
Portfolio of the Interest in exchange for the Investment by
the Fund of its Assets has been duly authorized by all
necessary action on the part of the Board of Trustees of the
Portfolio. When issued in accordance with the terms of this
Agreement, the Interest will be validly issued, fully paid and
non-assessable by the Portfolio.
(d) No Bankruptcy Proceedings. The Portfolio is not under the
jurisdiction of a court in a proceeding under Title 11 of the
Bankruptcy Code or similar case within the meaning of Section
368(a)(3)(A) of the Bankruptcy Code.
(e) Fiscal Year. The fiscal year end of the Portfolio is December
31.
(f) Auditors. The Portfolio has appointed Coopers & Xxxxxxx LLP as
the Portfolio's independent public accountants to certify the
Portfolio's financial statements in accordance with Section 32
of the 1940 Act.
(g) Registration Statement. The Portfolio has reviewed the
Company's registration statement on Form N-1A, as filed with
the SEC, and understands and agrees to the Fund's policies and
methods of operation as described therein.
(h) Errors and Omissions Insurance Policy. The Portfolio
participates in an errors and omissions liability insurance
policy insuring the Portfolio against loss up to $10,000,000
for negligence or wrongful acts.
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(i) SEC Filings. The Portfolio has duly filed all SEC Filings
required to be filed with the SEC pursuant to the 1934 Act and
the 1940 Act in connection with any meetings of its investors
and its registration as an investment company. Beneficial
interests in the Portfolio are not required to be registered
under the 1933 Act because such interests are offered solely
in private placement transactions that do not involve any
"public offering" within the meaning of Section 4(2) of the
1933 Act. The SEC Filings were prepared in accordance with the
requirements of the Securities Laws, as applicable, and the
rules and regulations of the SEC thereunder, and do not
contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or
necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not
misleading.
(j) 1940 Act Registration. The Portfolio is duly registered as an
open-end management investment company under the 1940 Act and
such registration is in full force and effect.
(k) Tax Status. The Portfolio is taxable as a partnership under
the Internal Revenue Code of 1986, as amended (the "Code").
3.3 The Adviser. The Adviser represents and warrants to the
Company and AMR that:
(a) Organization. The Adviser is a New York banking corporation
duly organized, validly existing and in good standing under
the laws of the State of New York and has the requisite power
and authority to conduct its business as now being conducted.
(b) Authorization of Agreement. The execution and delivery of this
Agreement by the Adviser have been duly authorized by all
necessary action on the part of the Adviser and no other
action or proceeding is necessary for the execution and
delivery of this Agreement by the Adviser. This Agreement has
been duly executed and delivered by the Adviser and
constitutes a legal, valid and binding obligation of the
Adviser.
(c) Advisers Act. The Adviser is exempt from the definition of an
investment adviser under the Investment Advisers Act of 1940,
as amended (the "Advisers Act"), and is not required to
register under that Act.
3.4 AMR. AMR represents and warrants to the Portfolio and the
Adviser that:
(a) Organization. AMR is a corporation duly organized, validly
existing and in good standing under the laws of the State of
Delaware and has the requisite power and
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authority to conduct its business as now being conducted.
(b) Authorization of Agreement. The execution and delivery of this
Agreement by AMR has been duly authorized by all necessary
action on the part of AMR and no other action or proceeding is
necessary for the execution and delivery of this Agreement by
AMR. This Agreement has been duly executed and delivered by
AMR and constitutes a legal, valid and binding obligation of
AMR.
(c) Investment Manager. AMR serves as the Fund's investment
manager and is duly registered as an investment adviser under
the Advisers Act.
ARTICLE IV
COVENANTS
4.1 The Company. The Company covenants that:
(a) Advance Review of Certain Documents. The Company will furnish
the Portfolio and the Adviser, at least three (3) days prior
to filing or first use, as the case may be, with drafts of its
registration statement on Form N-lA (including amendments) and
prospectus supplements or amendments relating to the Fund. AMR
will furnish the Portfolio and the Adviser with any proposed
advertising or sales literature that prominently features the
Fund at least one (1) business day prior to filing or first
use, as the case may be; provided, however, that such advance
approval shall not be required for advertising or sales
literature that merely references the name of the Fund as one
of a series offered by the Company. The Company agrees that it
will include in all such Fund documents any disclosures that
may be required by law, particularly those relating to the
Adviser's status as a bank, and it will include in all such
Fund documents any material comments reasonably made by the
Adviser or Portfolio. The Portfolio and Adviser will, however,
in no way be liable for any errors or omissions in such
documents, whether or not they make any objection thereto,
except to the extent such errors or omissions result from
information provided by the Adviser or the Portfolio. The
Company will not make any other written or oral representation
about the Portfolio or the Adviser, except to the extent such
representations are contained in the Fund's then current
prospectus, statement of additional information, or as is
otherwise authorized by the Adviser in writing.
(b) Tax Status. The Fund will qualify for treatment as a regulated
investment company under Subchapter M of the Code for all
periods during which this Agreement is in effect, except to
the extent a failure to so qualify may result from any action
or omission of the Portfolio.
(c) Investment Securities. The Fund will own no investment
security other than its
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Interest in the Portfolio for all periods during which this
Agreement is in effect.
(d) Proxy Voting. If requested to vote on matters pertaining to
the Portfolio (other than a vote by the Company to continue
the operation of the Portfolio upon the withdrawal of another
investor in the Portfolio), the Company will (i) call a
meeting of shareholders of the Fund for the purpose of seeking
instructions from shareholders regarding such matters, (ii)
vote the Fund's Interest proportionally as instructed by Fund
shareholders, and (iii) vote the Fund's Interest with respect
to the shares held by Fund shareholders who do not give voting
instructions in the same proportion as the shares of Fund
shareholders who do give voting instructions. The Company will
hold each such meeting of Fund shareholders in accordance with
its Declaration of Trust on a timetable reasonably established
by the Portfolio.
(e) Insurance. The Company shall at all times maintain errors and
omissions liability insurance with respect to the Fund
covering losses for negligence and wrongful acts in an amount
not less than $10,000,000.
(f) Auditors. In the event the Fund's independent public
accountants differ from those of the Portfolio, the Fund shall
be responsible for any reasonable costs and expenses
associated with the need for the Portfolio's independent
public accountants to provide information to the Fund's
independent public accountants.
4.2 Indemnification by AMR.
(a) AMR will indemnify and hold harmless the Portfolio, the
Adviser and their respective trustees, directors, officers and
employees and each other person who controls the Portfolio or
the Adviser, as the case may be, within the meaning of Section
15 of the 1933 Act (each, a "Covered Person" and collectively,
"Covered Persons"), against any and all losses, claims,
demands, damages, liabilities and expenses (each, a
"Liability" and collectively, the "Liabilities") (including,
unless AMR elects to assume the defense pursuant to paragraph
(b), the reasonable cost of investigating and defending
against any claims therefor and any counsel fees incurred in
connection therewith), joint or several, which
(i) arise out of or are based upon any of the Securities
Laws, any other statute or common law or are incurred
in connection with or as a result of any formal or
informal administrative proceeding or investigation
by a regulatory agency, insofar as such Liabilities
arise out of or are based upon the ground or alleged
ground that any direct or indirect omission or
commission by the Company or the Fund (either during
the course of its daily activities or in connection
with the accuracy of its representations or its
warranties in this Agreement) caused or continues to
cause the Portfolio
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to violate any federal or state securities laws or
regulations or any other applicable domestic or
foreign law or regulations or common law duties or
obligations, but only to the extent that such
Liabilities do not arise out of and are not based
upon an omission or commission of the Portfolio or
Adviser;
(ii) arise out of any misstatement of a material fact or
an omission of a material fact in the Company's
registration statement (including amendments thereto)
or included in Fund advertising or sales literature,
other than information provided by the Portfolio or
the Adviser or included in Fund advertising or sales
literature at the request of the Portfolio or the
Adviser;
(iii) result from the failure of any representation or
warranty made by the Company or AMR to be accurate
when made or the failure of the Company or AMR to
perform any covenant contained herein or to otherwise
comply with the terms of this Agreement;
(iv) arise out of any unlawful or negligent act of the
Company, AMR or any director, officer, employee or
agent of the Company or AMR, whether such act was
committed against the Company, the Portfolio, Bankers
Trust or any third party;
(v) arise out of any claim that the use of the names
"Standard & Poor's," "S&P," "Standard & Poor's 500"
or "500" by the Company violates any license or
infringes upon any trademark; or
(vi) result from any Liability of the Fund for which the
Portfolio is also liable; provided, however, that in
no case shall AMR be liable with respect to any claim
made against any Covered Person unless the Covered
Person shall have notified AMR in writing of the
nature of the claim within a reasonable time after
the summons, other first legal process or formal or
informal initiation of a regulatory investigation or
proceeding shall have been served upon or provided to
a Covered Person, or any federal, state or local tax
deficiency has come to the attention of the Adviser,
the Portfolio or a Covered Person. Failure to notify
AMR of such claim shall not relieve it from any
liability that it may have to any Covered Person
otherwise than on account of the indemnification
contained in this Section.
(b) AMR will be entitled to participate at its own expense in the
defense or, if it so elects, to assume the defense of any suit
brought to enforce any such liability, but, if AMR elects to
assume the defense, such defense shall be conducted by counsel
chosen by AMR. In the event AMR elects to assume the defense
of any such suit and retain such counsel, each Covered Person
and any other defendant or
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defendants may retain additional counsel, but shall bear the
fees and expenses of such counsel unless (A) AMR shall have
specifically authorized the retaining of such counsel or (B)
the parties to such suit include any Covered Person and AMR,
and any such Covered Person has been advised by counsel that
one or more legal defenses may be available to it that may not
be available to AMR, in which case AMR shall not be entitled
to assume the defense of such suit notwithstanding its
obligation to bear the fees and expenses of such counsel. AMR
shall not be liable to indemnify any Covered Person for any
settlement of any claim affected without AMR's written
consent, which consent shall not be unreasonably withheld or
delayed. The indemnities set forth in paragraph (a) will be in
addition to any liability that the Company in respect of the
Fund might otherwise have to a Covered Person.
4.3 The Portfolio. The Portfolio covenants that:
(a) Advance Review of Certain Documents. The Portfolio will
furnish the Company and AMR , at least five (5) business days
prior to filing or first use, as the case may be, with drafts
of its registration statement on Form N-1A (including
amendments) and prospectus supplements or amendments. The
Portfolio will not make any written or oral representation
about the Company or AMR without their prior written consent.
(b) Tax Status. The Portfolio will qualify to be taxable as a
partnership under the Code for all periods during which this
Agreement is in effect.
(c) Insurance. The Portfolio shall at all times maintain its
participation in an errors and omissions liability insurance
policy covering losses for negligence and wrongful acts in an
amount not less than $10,000,000.
(d) Availability of Interests. Conditional upon the Company
complying with the terms of this Agreement, the Portfolio
shall permit the Fund to make additional Investments in the
Portfolio on each business day on which shares of the Fund are
sold to the public; provided, however, that the Portfolio may
refuse to permit the Fund to make additional Investments in
the Portfolio on any day on which (i) the Portfolio has
refused to permit all other investors in the Portfolio to make
additional Investments in the Portfolio or (ii) the Trustees
of the Portfolio have reasonably determined that permitting
additional Investments by the Fund in the Portfolio would
constitute a breach of their fiduciary duties to the
Portfolio.
4.4 Indemnification by the Adviser.
(a) The Adviser will indemnify and hold harmless the Company, AMR,
their respective affiliates, directors, officers and employees
and each other person who controls the
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Company, the Fund or AMR, as the case may be, within the
meaning of Section 15 of the 1933 Act (each, a "Covered
Person" and collectively, "Covered Persons"), against any and
all losses, claims, demands, damages, liabilities and expenses
(each, a "Liability" and collectively, the "Liabilities")
(including, unless the Adviser elects to assume the defense
pursuant to paragraph (b), the reasonable costs of
investigating and defending against any claims therefor and
any counsel fees incurred in connection therewith), joint or
several, whether incurred directly by the Company or AMR or
indirectly by the Company or AMR through the Company's
Investment in the Portfolio, which:
(i) arise out of or are based upon any of the Securities
Laws, any other statute or common law or are incurred
in connection with or as a result of any formal or
informal administrative proceeding or investigation
by a regulatory agency, insofar as such Liabilities
arise out of or are based upon the ground or alleged
ground that any direct or indirect omission or
commission by the Portfolio (either during the course
of its daily activities or in connection with the
accuracy of its representations or its warranties in
this Agreement) caused or continues to cause the
Company to violate any federal or state securities
laws or regulations or any other applicable domestic
or foreign law or regulations or common law duties or
obligations, but only to the extent that such
Liabilities do not arise out of and are not based
upon an omission or commission of the Company or AMR;
(ii) arise out of or are based upon an inaccurate
calculation of the Portfolio's net asset value
(whether by the Portfolio, the Adviser or any party
retained for that purpose);
(iii) arise out of (A) any misstatement of a material fact
or an omission of a material fact in the Portfolio's
registration statement (including amendments thereto)
or included at the Adviser's or Portfolio's request
in advertising or sales literature used by the Fund,
or (B) any misstatement of a material fact or an
omission of a material fact in the registration
statement or advertising or sales literature of any
investor in the Portfolio, other than the Company;
(iv) arise out of the Portfolio's having caused the Fund
to fail to qualify as a regulated investment company
under the Code;
(v) result from the failure of any representation or
warranty made by the Portfolio or Adviser to be
accurate when made or the failure of the Portfolio or
Adviser to perform any covenant contained herein or
to otherwise comply with the terms of this Agreement;
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(vi) arise out of any unlawful or negligent act by the
Portfolio, the Adviser or any director, trustee,
officer, employee or agent of the Portfolio or
Adviser, whether such act was committed against the
Portfolio, the Company, AMR or any third party;
(vii) arise out of any claim that the systems,
methodologies, or technology used in connection with
operating the Portfolio, including the technologies
associated with maintaining the master-feeder
structure of the Portfolio, violates any license or
infringes upon any patent or trademark;
(viii) arise out of any claim that the use of the names
"Standard & Poor's," "S&P," "Standard & Poor's 500,"
"S&P 500" or "500" by the Portfolio violates any
license or infringes upon any trademark; or
(ix) result from any Liability of the Portfolio to any
investor in the Portfolio (or shareholder thereof),
other than the Fund (and its shareholders); provided,
however, that in no case shall the Adviser be liable
with respect to any claim made against any such
Covered Person unless such Covered Person shall have
notified the Adviser in writing of the nature of the
claim within a reasonable time after the summons,
other first legal process or formal or informal
initiation of a regulatory investigation or
proceeding shall have been served upon or provided to
a Covered Person or any federal, state or local tax
deficiency has come to the attention of the Company,
AMR or a Covered Person. Failure to notify the
Adviser of such claim shall not relieve it from any
liability that it may have to any Covered Person
otherwise than on account of the indemnification
contained in this paragraph.
(b) The Adviser will be entitled to participate at its own expense
in the defense or, if it so elects to assume the defense of
any suit brought to enforce any such liability, but, if the
Adviser elects to assume the defense, such defense shall be
conducted by counsel chosen by the Adviser. In the event the
Adviser elects to assume the defense of any such suit and
retain such counsel, each Covered Person and any other
defendant or defendants in the suit may retain additional
counsel but shall bear the fees and expenses of such counsel
unless (A) the Adviser shall have specifically authorized the
retaining of such counsel or (B) the parties to such suit
include any Covered Person and the Adviser, and any such
Covered Person has been advised by counsel that one or more
legal defenses may be available to it that may not be
available to the Adviser, in which case the Adviser shall not
be entitled to assume the defense of such suit notwithstanding
the obligation to bear the fees and expenses of such counsel.
The Adviser shall not be liable to indemnify any Covered
Person for any settlement of any such claim effected without
the Adviser's written consent, which content shall not be
unreasonably withheld or delayed. The
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indemnities set forth in paragraph (a) will be in addition to
any liability that the Portfolio might otherwise have to a
Covered Person.
4.6 In-Kind Redemption. In the event the Company desires to
withdraw or redeem all of the Fund's Interests in the Portfolio, unless
otherwise agreed to by the parties, the Portfolio will effect such redemption
"in kind" and in such a manner that the securities delivered to the Fund's
custodian for the account of the Fund will mirror, as closely as practicable,
the composition of the Portfolio immediately prior to such redemption. No other
withdrawal or redemption of any Interest in the Portfolio will be satisfied by
means of an "in kind" redemption except in compliance with Rule 18f-1 under the
1940 Act, provided, however, that for purposes of determining compliance with
Rule 18f-1, each shareholder of the Fund redeeming shares of the Fund on a
particular day will be treated as a direct holder of an Interest in the
Portfolio being redeemed that day.
4.7 Reasonable Actions. Each party covenants that it will, subject
to the provisions of this Agreement, from time to time, as and when requested by
another party or in its own discretion, as the case may be, execute and deliver
or cause to be executed and delivered all such assignments and other
instruments, take or cause to be taken such actions, and do or cause to be done
all things reasonably necessary, proper or advisable in order to consummate the
transactions contemplated by this Agreement and to carry out its intent and
purpose.
ARTICLE V
CONDITIONS PRECEDENT
The obligations of each party to consummate the transactions provided
for herein shall be subject to (a) performance by the other parties of all the
obligations to be performed by the other parties hereunder on or before each
Closing, (b) all representations and warranties of the other parties contained
in this Agreement being true and correct in all material respects as of the date
hereof and, except as they may be affected by the transactions contemplated by
this Agreement, as of each date of Closing, with the same force and effect as if
made on and as of the time of such Closing, and (c) the following further
conditions that shall be fulfilled on or before each Closing:
5.1 Regulatory Status. All necessary filings shall have been made
with the SEC and state securities authorities, and no order or directive shall
have been received that any other or further action is required to permit the
parties to carry out the transactions contemplated hereby.
5.2 Investment Objective/Restrictions. The Fund shall have the
same investment objective and substantively the same investment restrictions as
the Portfolio.
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ARTICLE VI
ADDITIONAL AGREEMENTS
6.1 Notification of Certain Matters. Each party will give prompt
notice to the other parties of (a) the occurrence or non-occurrence of any event
the occurrence or non-occurrence of which would be likely to cause either (i)
any representation or warranty contained in this Agreement to be untrue or
inaccurate, or (ii) any condition precedent set forth in Article V hereof to be
unsatisfied in any material respect at the time of any Closing and (b) any
material failure of a party or any trustee, director, officer, employee or agent
thereof to comply with or satisfy any covenant, condition or agreement to be
complied with or satisfied by such person hereunder; provided, however, that the
delivery of any notice pursuant to this Section 6.1 shall not limit or otherwise
affect the remedies available, hereunder or otherwise, to the party receiving
such notice.
6.2 Access to Information. The Portfolio and the Company shall
afford each other access at all reasonable times to such party's officers,
employees, agents and offices and to all its relevant books and records and
shall furnish each other party with all relevant financial and other data and
information as requested; provided, however, that nothing contained herein shall
obligate the Company to provide the Portfolio with access to the books and
records of the Company relating to any series of the Company other than the
Fund, nor shall anything contained herein obligate the Company to furnish the
Portfolio with the Fund's shareholder list, except as may be required to comply
with applicable law or any provision of this Agreement.
6.3 Confidentiality. Each party agrees that it shall hold in
strict confidence all data and information obtained from another party (unless
such information is or becomes readily ascertainable from public or published
information or trade sources) and shall ensure that its officers, employees and
authorized representatives do not disclose such information to others without
the prior written consent of the party from whom it was obtained, except if
disclosure is required by the SEC, any other regulatory body or the Fund's or
Portfolio's respective auditors, or in the opinion of counsel such disclosure is
required by law, and then only with as much prior written notice to the other
party as is practical under the circumstances.
6.4 Public Announcements. No party shall issue any press release
or otherwise make any public statements (other than statements made in
advertisements and sales literature approved by the Adviser) with respect to the
matters covered by this Agreement without the prior consent of the other parties
hereto, which consent shall not be unreasonably withheld; provided, however,
that consent shall not be required if, in the opinion of counsel, such
disclosure is required by law, provided further, however, that the party making
such disclosure shall provide the other parties hereto with as much prior
written notice of such disclosure as is practical under the circumstances.
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ARTICLE VII
TERMINATION, AMENDMENT AND WAIVER
7.1 Termination.
(a) This Agreement may be terminated by the mutual agreement of
all parties.
(b) This Agreement may be terminated at any time by the Company by
withdrawing all of the Fund's Interest in the Portfolio.
(c) This Agreement may be terminated on not less than 120 days'
prior written notice by the Portfolio to the Company and AMR.
(d) This Agreement shall terminate automatically with respect to
AMR upon the effective date of termination by the Company and
this Agreement shall terminate automatically with respect to
the Adviser upon the effective date of termination by the
Portfolio.
(e) This Agreement may be terminated at any time immediately upon
written notice to the other parties in the event that formal
proceedings are instituted against another party to this
Agreement by the SEC or any other regulatory body, provided
that the terminating party has a reasonable belief that the
institution of the proceeding is not without foundation and
will have a material adverse impact on the terminating party.
(f) The indemnification obligations of AMR and the Adviser set
forth in Article IV, Sections 4.2 and 4.4, respectively, shall
survive the termination of this Agreement.
7.2 Amendment. This Agreement may be amended, modified or
supplemented at any time in such manner as may be mutually agreed upon in
writing by the parties.
7.3 Waiver. At any time prior to any Closing, any party may (a)
extend the time for the performance of any of the obligations or other acts of
the other parties hereto, (b) waive any inaccuracies in the representations and
warranties contained herein or in any document delivered pursuant hereto and (c)
waive compliance with any of the agreements or conditions contained herein.
ARTICLE VIII
DAMAGES
The parties agree that, in the event of a breach of this Agreement, the
remedy of money damages would not be adequate and agree that injunctive relief
would be the appropriate relief.
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ARTICLE IX
GENERAL PROVISIONS
9.1 Notices. All notices and other communications given or made
pursuant hereto shall to in writing and shall be deemed to have been duly given
or made when actually received in person or by fax, or three days after being
sent by certified or registered United States mail, return receipt requested,
postage prepaid, addressed as follows:
If to AMR or the AMR Investment Services, Inc.
Company: 0000 Xxxx Xxxxxx Xxxx., XX 5645
Xxxx Xxxxx, Xxxxx 00000
Attn: Xxxxx X. Xxxxxxxxx, Esq.
Fax: (000) 000-0000
If to the Portfolio Bankers Trust Company
or the Adviser: c/o BT Xxxx Xxxxx Incorporated
Xxx Xxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attn: Xx. Xxxxx X. Xxxxxx
Fax: (000) 000-0000
9.2 Expenses. All costs and expenses incurred in connection with
this Agreement and the transactions contemplated hereby shall be paid by the
party incurring such costs and expenses.
9.3 Headings. The headings and captions contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.
9.4 Severability. If any term or other provision of this Agreement
is invalid, illegal or incapable of being enforced by any rule of law, or public
policy, all other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect so long as the economic or legal substance of
the transactions contemplated hereby is not affected in any manner adverse to
any party. Upon such determination that any term or other provision is invalid,
illegal or incapable of being enforced, the parties hereto shall negotiate in
good faith to modify this Agreement so as to effect the original intent of the
parties as closely as possible in an acceptable manner to the end that the
transactions contemplated hereby are fulfilled to the extent possible.
9.5 Entire Agreement. This Agreement and the agreements and other
documents delivered pursuant hereto set forth the entire understanding between
the parties concerning the subject matter of this Agreement and incorporate or
supersede all prior negotiations and understandings. There are no covenants,
promises, agreements, conditions or understandings, either oral or written,
between them relating to the subject matter of this Agreement other than those
set forth herein. No representation or warranty has been made by or on behalf of
any party
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to this Agreement (or any officer, director, trustee, employee or agent thereof)
to induce any other party to enter into this Agreement or to abide by or
consummate any transactions contemplated by any terms of this Agreement, except
representations and warranties expressly set forth herein.
9.6 Successors and Assignments. Each and all of the provisions of
this Agreement shall be binding upon and inure to the benefit of the parties
hereto and, except as otherwise specifically provided in this Agreement, their
respective successors and assigns. Notwithstanding the foregoing, no party shall
make any assignment of this Agreement or any rights or obligations hereunder
without the written consent of all other parties. As used herein, the term
"assignment" shall have the meaning ascribed thereto in the 1940 Act.
9.7 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York without giving
effect to the choice of law or conflicts of law provisions thereof.
9.8 Counterparts. This Agreement may be executed in any number of
counterparts, all of which shall constitute one and the same instrument, and any
party hereto may execute this Agreement by signing one or more counterparts.
9.9 Third Parties. Nothing herein expressed or implied is intended
or shall be construed to confer upon or give any person, other than the parties
hereto and their successors or assigns, any rights or remedies under or by
reason of this Agreement.
9.10 Interpretation. Any uncertainty or ambiguity existing herein
shall not presumptively be interpreted against any party, but shall be
interpreted according to the application of the rules of interpretation for
arm's length agreements.
9.11 Limitation of Liability. The parties hereby acknowledge that
the Company has entered into this Agreement solely on behalf of the Fund and
that no other series of the Company shall have any obligation hereunder with
respect to any liability of the Company arising hereunder.
9.12 Status of the Company. Notice is hereby given that the Company
is a Massachusetts business trust whose Declaration of Trust is on file with the
Commonwealth of Massachusetts and that this Agreement is entered into on behalf
of the Company and not on behalf of its trustees, officers or shareholders, and
that the obligations of this Agreement are not binding upon such persons or
their assets, but only upon the Company and its assets and property.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their respective officers, thereunto duly authorized, as of the date
first written above.
AMR INVESTMENT SERVICES, INC.
By
-------------------------------
Name: Xxxxxxx X. Xxxxx
Title: President
AMERICAN AADVANTAGE MILEAGE FUNDS on behalf of
itself and the AMERICAN AADVANTAGE S&P 500 INDEX
MILEAGE FUND, a series thereof
By
-------------------------------
Name: Xxxxxxx X. Xxxxx
Title: President
EQUITY 500 INDEX PORTFOLIO
By
-------------------------------
Name:
-----------------------------
Title:
----------------------------
BANKERS TRUST COMPANY
By
-------------------------------
Name:
-----------------------------
Title:
----------------------------
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