SERVICES AGREEMENT
AGREEMENT made as of the ___ day of _____________, 2004, between
USALLIANZ VARIABLE INSURANCE PRODUCTS FUND OF FUNDS TRUST (the "Trust"), a
Delaware business trust, and BISYS FUND SERVICES OHIO, INC. ("BISYS"), a
Delaware corporation having its principal place of business at 0000 Xxxxxxx
Xxxx, Xxxxxxxx, Xxxx 00000.
WHEREAS, the Trust desires that BISYS perform administration, fund
accounting, and transfer agency services for the Trust and each series portfolio
of the Trust, as now in existence and listed on Schedule A hereto, or as
hereafter may be established from time to time (individually referred to herein
as a "Fund," and collectively as the "Funds");
WHEREAS, BISYS is willing to perform such services on the terms and
conditions set forth in this Agreement; and
WHEREAS, BISYS and Trust wish to enter into this Agreement in order to
set forth the terms under which BISYS will perform administration, fund
accounting, and transfer agency services (collectively, "Services") for the
Trust.
NOW, THEREFORE, in consideration of the covenants herinafter contained,
the Trust and BISYS hereby agree as follows:
ARTICLE 1. Services
(a) Administrative Services. On behalf of the Trust and each of the Funds, BISYS
will investigate, assist in the selection of, and conduct relations with
custodians, depositories, accountants, legal counsel, underwriters, brokers and
dealers, corporate fiduciaries, insurers, banks and persons in any other
capacity deemed to be necessary or desirable for the Trust's and each of the
Fund's operations as agreed upon by BISYS and the Trust. In addition, BISYS
shall provide the Trust's Board of Trustees (the "Board") with such reports
regarding investment performance as it may reasonably request but shall have no
responsibility for supervising the performance by any investment adviser or
sub-adviser of its responsibilities.
BISYS shall provide the Trust and each of the Funds with all necessary
office space, equipment, personnel, compensation, and facilities (including
facilities for the Trust's shareholders' and Board meetings to the extent the
Trust so requests) for rendering the administration services described hereunder
and such other ancillary services as BISYS shall, from time to time, determine
to be necessary to perform its obligations as administrator under this
Agreement. In addition, at the request of the Trust or Board, BISYS shall make
reports to the Trust and the Board concerning the performance of such
obligations hereunder.
Without limiting the generality of the foregoing, BISYS shall perform
the administrative services described in Schedule B. BISYS shall also perform
such other administrative services for the Trust to the extent agreed upon in
advance by the parties from time to time, for which BISYS shall provide a quote
as to fees and estimated expenses upon request, and the Trust will pay the
amounts agreed upon by BISYS and the Trust following the Trust's review of such
quoted fees and estimated expenses and prior written approval of such fees and
expenses. Except as explicitly set forth herein (including Schedule B), BISYS
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shall perform only such additional services as are provided on an amendment to
this Agreement, in consideration of such fees as the parties hereto may agree.
(b) Fund Accounting Services. BISYS shall perform for the Trust the fund
accounting services described in Schedule C. BISYS shall also perform such
special accounting services, and furnish such reports, for the Trust and the
Funds to the extent agreed upon in advance by the parties from time to time, for
which the Trust will pay the amounts agreed upon by BISYS and the Trust. Except
as explicitly set forth herein (including Schedule C), BISYS shall perform only
such additional services as are provided on an amendment to this Agreement, in
consideration of such fees as the parties hereto may agree. BISYS shall provide
a quote as to fees and estimated expenses upon request, and the Trust will pay
the amounts agreed upon by BISYS and the Trust following the Trust's review of
such quoted fees and estimated expenses and prior written approval of such fees
and expenses.
(c) Transfer Agency Services. BISYS shall perform for the Trust the transfer
agency services set forth in Schedule D hereto. BISYS shall also perform such
special transfer agency services, and furnish such reports, for the Trust and
the Funds to the extent agreed upon by the parties from time to time, for which
the Trust will pay the amounts agreed upon by BISYS and the Trust. Except as
explicitly set forth herein (including Schedule D), BISYS shall perform only
such additional services as are provided on an amendment to this Agreement, in
consideration of such fees as the parties hereto may agree. BISYS shall provide
a quote as to fees and estimated expenses upon request, and the Trust will pay
the amounts as may be agreed upon by BISYS and the Trust following the Trust's
review of such quoted fees and estimated expenses and prior written approval of
such fees and expenses.
(d) Certain Deadlines and Service Standards. From time to time, the Trust may
propose certain deadlines and service standards applicable to BISYS's provision
of the Services or certain aspects of the Services, and such service standards
shall be set forth as Schedule E to this Agreement. Notwithstanding the
effective date of this Agreement, Schedule E may bear a different effective
date, in which case such Schedule shall be in effect commencing on such
effective date and continuing for the remaining term of this Agreement or until
subsequently amended upon mutual agreement of the parties. During any period for
which Schedule E is effective, BISYS agrees to perform the relevant Services in
accordance with and otherwise comply with the provisions set forth in Schedule
E. However, such standards or deadlines shall not be used generally in the
construction of the parties' rights and obligations under other provisions of
this Agreement, and any acknowledgment by BISYS that a particular deadline or
other requirement set forth in Schedule E was not met in any particular case,
shall be without prejudice to BISYS and shall not be construed as an admission
or as a waiver of any rights of BISYS generally under this Agreement.
ARTICLE 2. Subcontracting
BISYS may, at its expense, utilize agents in connection with the
rendering of Services and may subcontract with any entity or person concerning
the provision of the Services; provided that BISYS shall not be relieved of any
of its obligations under this Agreement by the appointment of such
subcontractor, and provided, further, that BISYS shall be responsible, to the
extent provided in Article 7 hereof, for all acts of such subcontractor as if
such acts were its own including any payment for services provided by
subcontractor.
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ARTICLE 3. Allocation of Charges and Expenses
(a) BISYS. BISYS shall furnish at its own expense the executive, supervisory,
and clerical personnel necessary to perform its obligations under this
Agreement. BISYS shall also provide the items which it is obligated to provide
under this Agreement, and shall pay all compensation, if any, of officers of the
Trust and Trustees of the Trust who are affiliated persons of BISYS or any
affiliated corporation of BISYS. Unless otherwise specifically provided in this
Agreement, BISYS shall not be obligated to pay the compensation of any employee
of the Trust or other person retained by the Board or the Trust to perform
services on behalf of the Trust.
(b) The Trust. The Trust assumes and shall pay or cause to be paid all other
expenses of the Trust not otherwise allocated herein, including, without
limitation, organization costs, taxes, expenses for legal and auditing services,
the expenses of preparing (including typesetting), printing and mailing reports,
prospectuses, statements of additional information, proxy solicitation material
and notices to existing shareholders, all expenses incurred in connection with
issuing and redeeming shares of beneficial interest in the Trust ("Shares"), the
costs of obtaining securities pricing information, the costs of custodial
services, the cost of registration of the Shares under Federal securities laws,
fees and out-of-pocket expenses of Trust officers and Trustees who are not
affiliated persons of BISYS or any affiliated corporation of BISYS, insurance
and fidelity bond premiums and related expenses, interest, brokerage costs,
litigation, and other extraordinary or nonrecurring expenses, all fees and
charges of the investment advisers to the Trust, and any amounts payable as Rule
12b-1 fees, if any.
ARTICLE 4. Compensation of BISYS
(a) Services Fee. For the Services to be rendered, and the facilities furnished
and the expenses assumed by BISYS pursuant to this Agreement in connection with
the Services, the Trust shall pay to BISYS the compensation specified in
Schedule A attached hereto. Such compensation shall be calculated and accrued
daily, and paid to BISYS monthly.
If this Agreement becomes effective subsequent to the first day of a
month or terminates in accordance with its terms before the last day of a month,
BISYS' compensation for that part of the month in which this Agreement is in
effect shall be prorated in a manner consistent with the calculation of the fees
as set forth above. Payment of BISYS' compensation for the preceding month shall
be made promptly.
(b) Reimbursement of Expenses. In addition to the fees payable by
the Trust under Article 4(a), the Trust shall also reimburse
BISYS for its reasonable out-of-pocket expenses in providing
Services. BISYS shall use its best efforts in selecting and
monitoring third party vendors used by BISYS to ensure quality
and financial competitiveness, shall make reasonable effort to
provide estimated expenses in advance for extraordinary
charges, shall respond within a reasonable time to inquiries
of the Trust concerning expenses charged to the Trust, and
upon request shall provide explanations of the charges and
copies of back-up documents available to substantiate the
charges. The expenses that may be incurred include the
following:
(i) All freight and other delivery and bonding charges incurred by
BISYS in delivering materials to and from the Trust and in
delivering all materials to shareholders;
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(ii) All direct telephone, telephone transmission, and telecopy or
other electronic transmission and remote system access
expenses incurred by BISYS in communication with the Trust,
the Trust's investment adviser or custodian, dealers, or
others as required for BISYS to perform the Services;
(iii) The cost of CD-ROM, computer disks, microfilm, or microfiche,
and storage of records or other materials and data;
(iv) Costs of postage, bank services, couriers, stock computer
paper, statements, labels, envelopes, reports, proxies,
notices, or other form of printed material (including the cost
of preparing and printing all printed material) which shall be
required by BISYS for the performance of the services to be
provided hereunder, including print production charges
incurred;
(v) All copy charges;
(vi) The reasonable travel and lodging expenses incurred by
officers and employees of BISYS in connection with attendance
at Board meetings;
(vii) Any expenses BISYS shall incur at the written direction of the
Trust or an officer of the Trust thereunto duly authorized;
and
(viii) Any additional expenses reasonably incurred by BISYS in the
performance of its duties and obligations under this
Agreement.
(c) Miscellaneous Service Fees and Charges. In addition to the
amounts set forth in paragraphs (a) and (b) above, BISYS shall
be entitled to receive the following amounts from the Trust:
(i) A fee for managing and overseeing the report, print and mail
functions performed by BISYS' third-party vendors, not to
exceed $.04 per page for statements and $.03 per page for
confirmations; fees for pre-approved programming in connection
with creating or changing the forms of statements, billed at
the rate of $150 per hour;
(ii) System development fees, billed at the rate of $150 per hour,
as requested and pre-approved by the Trust, and all
systems-related expenses, agreed in advance, associated with
the provision of special reports and services pursuant to any
of the Schedules hereto;
(iii) Fees for development of custom interfaces pre-approved by the
Trust, billed at a mutually agreed upon rate;
(iv) Ad hoc reporting fees pre-approved by the Trust, billed at a
mutually agreed upon rate;
(v) Expenses associated with the tracking of "as-of" trades,
billed at the rate of $50 per hour, as approved by the
Trust;
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(vi) Charges for the pricing information obtained from third party
vendors for use in pricing the securities of each Fund's
investment portfolio pursuant to Schedule C, which shall not
exceed the amounts that would be incurred if the Fund were to
obtain the information directly from the relevant vendor or
vendors; and
(vii) Expenses associated with BISYS' anti-fraud procedures as it
pertains to new account review and the performance of
delegated services under the written anti-money laundering
program ("AML Program") adopted by the Trust.
If there are changes to any applicable laws which affect the Services
provided by BISYS under this Agreement, and of which BISYS is notified in
writing by the Trust or otherwise becomes aware, then BISYS shall use reasonable
efforts to develop and implement any necessary changes in the systems and take
any other actions reasonably required so that the services provided by BISYS
continue to meet the requirements of applicable laws. BISYS and the Trust shall
negotiate in good faith the costs associated with such systems modifications and
other changes as may be necessary in connection with the foregoing.
(d) Survival of Compensation Rights. All rights of compensation and
reimbursement under this Agreement for Services performed and expenses incurred
shall survive the termination of this Agreement, subject to Article 6.
ARTICLE 5. Standard of Care; Uncontrollable Events; Limitation of Liability
BISYS shall use reasonable professional diligence to ensure the
accuracy of all services performed under this Agreement, and shall be liable to
the Trust only for actions taken or omitted by BISYS involving bad faith,
willful misfeasance, negligence or reckless disregard by it of its obligations
and duties. The duties of BISYS shall be confined to those expressly set forth
herein, and no implied duties are assumed by or may be asserted against BISYS
hereunder.
BISYS shall maintain adequate and reliable computer and other equipment
necessary or appropriate to carry out its obligations under this Agreement. Upon
the Trust's reasonable request, BISYS shall provide supplemental information
concerning the aspects of its disaster recovery and business continuity plan
that are relevant to the services provided hereunder. Notwithstanding the
foregoing or any other provision of this Agreement, BISYS assumes no
responsibility hereunder, and shall not be liable for, any damage, loss of data,
delay or any other loss whatsoever caused by events beyond its reasonable
control. Events beyond BISYS' reasonable control include, without limitation,
force majeure events. Force majeure events include natural disasters, actions or
decrees of governmental bodies, and communication lines failures that are not
the fault of either party. In the event of force majeure, computer or other
equipment failures or other events beyond its reasonable control, BISYS shall
follow applicable procedures in its disaster recovery and business continuity
plan and use all commercially reasonable efforts to minimize any service
interruption. BISYS will notify the Trust promptly in the event that the BISYS
Incident Management Team declares a disaster under the disaster recovery and
business continuity plan, and will provide the Trust with such information and
updates as to the scope of the disaster and expected duration as may be
reasonably available.
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BISYS shall provide the Trust, at such times as the Trust may
reasonably require, copies of reports rendered by independent public accountants
on the internal controls and procedures of BISYS relating to the services
provided by BISYS under this Agreement.
NOTWITHSTANDING ANYTHING IN THIS AGREEMENT TO THE CONTRARY, IN NO EVENT
SHALL BISYS, ITS AFFILIATES OR ANY OF ITS OR THEIR DIRECTORS, OFFICERS,
EMPLOYEES, AGENTS OR SUBCONTRACTORS BE LIABLE FOR PUNITIVE OR CONSEQUENTIAL
DAMAGES, OR LOST PROFITS, EACH OF WHICH IS HEREBY EXCLUDED BY AGREEMENT OF THE
PARTIES REGARDLESS OF WHETHER SUCH DAMAGES WERE FORESEEABLE OR WHETHER EITHER
PARTY OR ANY ENTITY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
ARTICLE 6. Term
This Agreement shall become effective as of the date first written
above (the "Effective Date"). This Agreement shall continue in effect until
December 31, 2005 (the "Initial Term"). Thereafter, unless otherwise terminated
as provided herein, this Agreement shall be renewed automatically for successive
one year periods ("Rollover Periods"). This Agreement may be terminated only (i)
by provision of a notice of nonrenewal in the manner set forth below, (ii) by
mutual agreement of the parties, (iii) for "cause," as defined below, upon the
provision of sixty (60) days advance written notice by the party alleging cause,
or (iv) as provided in Schedule E. Written notice of nonrenewal must be provided
at least ninety (90) days prior to the end of the Initial Term or any Rollover
Period, as the case may be.
For purposes of this Agreement, "cause" shall mean (a) a material
breach of this Agreement that has not been remedied for thirty (30) days
following written notice of such breach from the non-breaching party; (b) a
final, unappealable judicial, regulatory or administrative ruling or order in
which the party to be terminated has been found guilty of criminal or unethical
behavior in the conduct of its business; or (c) financial difficulties on the
part of the party to be terminated which are evidenced by the authorization or
commencement of, or involvement by way of pleading, answer, consent or
acquiescence in, a voluntary or involuntary case under Title 11 of the United
States Code, as from time to time is in effect, or any applicable law, other
than said Title 11, of any jurisdiction relating to the liquidation or
reorganization of debtors or to the modification or alteration of the rights of
creditors. BISYS shall not terminate this Agreement pursuant to clause (a) above
based solely upon the Trust's failure to pay an amount to BISYS which is the
subject of a good faith dispute, if (i) the Trust is attempting in good faith to
resolve such dispute with as much expediency as may be possible under the
circumstances, and (ii) the Trust continues to perform its obligations hereunder
in all other material respects (including paying all fees and expenses not
subject to reasonable dispute hereunder).
Notwithstanding the foregoing, following any such termination, in the
event that BISYS in fact continues to perform any one or more of the Services
contemplated by this Agreement (or any Schedule or exhibit hereto) with the
consent of the Trust, the provisions of this Agreement, including without
limitation the provisions dealing with indemnification, shall continue in full
force and effect. Fees and out-of-pocket expenses incurred prior to termination
and unpaid by the Trust upon such termination shall be immediately due and
payable upon and notwithstanding such termination.
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Except as specifically provided below in this paragraph, BISYS shall be
entitled to collect from the Trust the amount of all of BISYS' out of pocket
expenses in connection with BISYS' activities in effecting a termination,
including without limitation, the delivery to the Trust and/or its investment
adviser and/or other parties of the Trust's property, records, instruments and
documents. In the event of a termination by the Trust for "cause" hereunder,
BISYS shall provide such transition assistance as is reasonably required to
facilitate an orderly transition of services. Such transition assistance shall
be considered Services subject to all of the terms and conditions of this
Agreement; provided, however, that BISYS shall not be entitled to reimbursement
of the costs for electronic transfers of data in implementing a conversion from
its systems in connection with such a termination by the Trust for "cause"
hereunder.
If, for any reason other than (i) nonrenewal, (ii) mutual agreement of
the parties, (iii) "cause" for termination of BISYS hereunder, or (iv) a
termination as provided in Schedule E, BISYS' services are terminated hereunder,
BISYS is replaced as administrator, fund accountant or transfer agent, or if a
third party is added to perform all or a part of the Services provided by BISYS
under this Agreement (excluding any subcontractor appointed as provided in
Article 2 hereof), then the Trust shall make a one-time cash payment, in
consideration of the fee structure and services to be provided under this
Agreement, and not as a penalty, to BISYS equal to the balance that would be due
BISYS for its Services hereunder during (x) the next twelve (12) months or (y)
if less than twelve (12), the number of months remaining in the then-current
term of this Agreement, assuming for purposes of the calculation of the one-time
payment that the fees that would be earned by BISYS for each month shall be
based upon the average monthly amount of fees payable to BISYS during the twelve
(12) months prior to the date that Services terminate, BISYS is replaced or a
third party is added.
The liquidated damages provision set forth above shall not be
applicable to liquidations of individual Funds of the Trust which may occur from
time to time for legitimate economic or regulatory reasons, rather than pursuant
to any express or tacit plan, understanding or arrangement whereby the assets of
the Fund are designed or intended to migrate, directly or indirectly, to another
investment company or other investment vehicle; nor shall such liquidated
damages provision be applicable to Funds of the Trust that are established
subsequent to the Effective Date of this Agreement through a reorganization or
other transaction in which the assets of such Fund are initially acquired or
otherwise transferred from another investment vehicle. In addition, it is
understood and agreed that US Allianz Advisers, LLC and its affiliates may
render certain services to the Trust (i.e., services that are not "core"
services hereunder but which would otherwise be rendered by BISYS hereunder) and
that the liquidated damages provision is not intended to apply to such
arrangements, provided that BISYS' compensation hereunder continues to be paid
in full without offset or credit for such services rendered by US Allianz
Advisers LLC and its affiliates.
Except as provided in the above paragraph, in the event the Trust or
any Fund is merged into another legal entity in part or in whole pursuant to any
form of business reorganization or is liquidated in part or in whole prior to
the expiration of the then-current term of this Agreement, the parties
acknowledge and agree that the liquidated damages provision set forth above
shall be applicable in those instances in which BISYS is not retained to provide
services consistent with this Agreement. In such cases, the one-time cash
payment for liquidated damages referenced above shall be due and payable on the
day prior to the first day in which services are terminated, BISYS is replaced
or a third party is added.
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The parties further acknowledge and agree that, in the event services
are terminated, BISYS is replaced, or a third party is added, under
circumstances in which the liquidated damages provision would applicable as set
forth above, (i) a determination of actual damages incurred by BISYS would be
difficult, and (ii) the liquidated damages provision contained herein is
intended to adequately compensate BISYS for damages incurred and is not intended
to constitute any form of penalty.
ARTICLE 7. Indemnification
The Trust agrees to indemnify and hold harmless BISYS, its employees,
agents, directors, officers and nominees from and against any and all claims,
demands, actions and suits, and from and against any and all judgments,
liabilities, losses, damages, costs, charges, counsel fees and other expenses
arising out of or relating to BISYS' actions taken or omissions with respect to
the performance of services under this Agreement or based, if applicable, upon
reasonable reliance on information, records, instructions or requests given or
made to BISYS by the Trust, the investment adviser, fund accountant or custodian
thereof; provided that this indemnification shall not apply to actions or
omissions of BISYS in cases of its own bad faith, willful misfeasance,
negligence or reckless disregard by it of its obligations and duties.
BISYS shall indemnify, defend, and hold the Trust harmless from and
against any and all claims, actions and suits and all losses, damages, costs,
charges, reasonable counsel fees and disbursements, payments, expenses and
liabilities (including reasonable investigation expenses) resulting directly and
proximately from BISYS' willful misfeasance, bad faith or negligence in the
performance of its duties or by reason of reckless disregard of its obligations
and duties hereunder.
The indemnification rights hereunder shall include the right to
advances of defense expenses (including reasonable attorney fees) in the event
of any pending or threatened litigation with respect to which indemnification
hereunder may ultimately be merited. In order that the indemnification
provisions contained herein shall apply, however, it is understood that if in
any case a party may be asked to indemnify or hold the other party harmless, the
indemnifying party shall be fully and promptly advised of all pertinent facts
concerning the situation in question, and it is further understood that the
indemnified party will use all reasonable care to identify and notify the
indemnifying party promptly concerning any situation which presents or appears
likely to present the probability of such a claim for indemnification against
the indemnifying party, but failure to do so in good faith shall not affect the
rights hereunder except to the extent the indemnifying party is materially
prejudiced thereby. Prior to confessing or settling any claim against it which
may be the subject of this indemnification, an indemnified party hereunder shall
give the indemnifying party or parties written notice of and reasonable
opportunity to defend against said claim in its own name or names, or in the
name of the indemnified party.
The indemnifying party shall be entitled to participate at its own
expense or, if it so elects, to assume the defense of any suit brought to
enforce any claims subject to this indemnity provision. If the indemnifying
party elects to assume the defense of any such claim, the defense shall be
conducted by counsel chosen by it and reasonably satisfactory to the indemnified
party, whose approval shall not be unreasonably withheld. In the event that the
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indemnifying party elects to assume the defense of any suit and retain counsel,
the indemnified party shall bear the fees and expenses of any additional counsel
retained by it. If the indemnifying party does not elect to assume the defense
of suit, it will reimburse the indemnified party for the reasonable fees and
expenses of any counsel retained by the indemnified party. The indemnity and
defense provisions set forth herein shall indefinitely survive the termination
of this Agreement.
ARTICLE 8. Compliance with Governing Documents and Laws
In the performance of its duties and obligations under this Agreement,
BISYS shall act in conformity with the Trust's Declaration of Trust and Bylaws,
will safeguard and promote the welfare of the Trust, and will comply with the
instructions and directions received from the Board; provided that such
instructions or directions are not in conflict with the terms of this Agreement,
the Trust's governing documents, or any applicable laws.
Except for the obligations of BISYS explicitly set forth in this
Agreement, the Trust assumes full responsibility for its compliance with all
laws, rules and regulations of governmental authorities having jurisdiction over
it including, the preparation and contents of each registration statement of the
Trust and amendment thereto, and the preparation, contents and distribution of
each prospectus of the Funds and the compliance of the same with all applicable
requirements of the Securities Act of 1933, as amended (the "1933 Act"), the
Investment Company Act of 1940, as amended (the "1940 Act"), and any other laws,
rules and regulations of any other governmental authorities having jurisdiction.
BISYS shall have no obligation to take cognizance of any laws relating to the
sale of Fund shares. The Trust represents and warrants that no shares of a Fund
will be offered to the public by the Trust unless covered by an effective
registration statement filed by the Trust under the 1933 Act and the 1940 Act.
The Trust acknowledges that it is a financial institution subject to
the law entitled United and Strengthening America by Providing Appropriate Tools
Required to Intercept and Obstruct Terrorism ("U.S.A. Patriot") Act of 2001 and
applicable provisions of the Bank Secrecy Act (collectively, the "AML Acts") and
shall comply with the AML Acts and applicable regulations adopted thereunder
(collectively, the "Applicable AML Laws") in all relevant respects, subject to
the delegation of certain responsibilities to BISYS, as provided in the next
paragraph below.
The Trust hereby delegates to BISYS the performance, on behalf of the
Trust, of the anti-money laundering services set forth under Item 5 of Schedule
D as concerns the shareholder accounts maintained by BISYS pursuant to this
Agreement. BISYS agrees to the foregoing delegation and agrees to perform such
services in accordance with the Trust's AML Program. In connection therewith,
BISYS agrees to maintain policies and procedures, and related internal controls,
that are consistent with the Trust's AML Program and the requirement that the
Trust employ procedures reasonably designed to achieve compliance with the
Applicable AML Laws, including the requirement to have policies and procedures
that can be reasonably expected to detect and cause the reporting of
transactions under Section 5318 of the Bank Secrecy Act.
The Trust maintains full responsibility for ensuring that its AML
Program is, and shall continue to be, reasonably designed to ensure compliance
with the Applicable AML Laws, in light of the particular business of the Trust,
taking into account factors such as its size, location, activities and risks or
vulnerabilities to money laundering.
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ARTICLE 9. Instructions / Certain Procedures
Whenever BISYS is requested or authorized to take action hereunder
pursuant to instructions from a shareholder, or a properly authorized agent of a
shareholder ("shareholder's agent"), concerning an account in a Fund, BISYS
shall be entitled to rely upon any certificate, letter or other instrument or
communication (including electronic mail), reasonably believed by BISYS to be
genuine and to have been properly made, signed or authorized by an officer or
other authorized agent of the Trust or by the shareholder or shareholder's
agent, as the case may be, and shall be entitled to receive as conclusive proof
of any fact or matter required to be ascertained by it hereunder a certificate
signed by an officer of the Trust or any other person authorized by the Trust's
Board of Trustees (hereafter referred to as the "Board") or by the shareholder
or shareholder's agent, as the case may be.
As to the services to be provided hereunder, BISYS may rely
conclusively upon the terms of the Prospectuses and Statement of Additional
Information of the Trust relating to the relevant Funds to the extent that such
services are described therein unless BISYS receives written instructions to the
contrary in a timely manner from the Trust.
The parties hereto may amend any procedures adopted, approved or set
forth herein by written agreement as may be appropriate or practical under the
circumstances, and BISYS may conclusively assume that any special procedure
which has been approved by an executive officer of the Trust (other than an
officer or employee of BISYS) does not conflict with or violate any requirements
of the Trust's Declaration of Trust, By-Laws or then-current prospectuses, or
any rule, regulation or requirement of any regulatory body.
The Trust acknowledges receipt of a copy of BISYS' policy related to
the acceptance of trades for prior day processing (the "BISYS As-Of Trading
Policy"). BISYS may amend the BISYS As-of Trading Policy from time to time in
its sole discretion. A copy of any such amendments shall be delivered to the
Trust upon request. BISYS may apply the BISYS As-Of Trading Policy whenever
applicable, unless BISYS agrees in writing to process trades according to such
other as-of trading policy as may be adopted by the Trust and furnished to BISYS
by the Trust.
ARTICLE 10. Record Retention and Confidentiality
BISYS shall keep and maintain on behalf of the Trust all books and
records which the Trust or BISYS is, or may be, required to keep and maintain
pursuant to any applicable statutes, rules and regulations, including without
limitation Rules 31a-1 and 31a-2 under the 1940 Act, relating to the maintenance
of books and records in connection with the services to be provided hereunder.
BISYS further agrees that all such books and records shall be the property of
the Trust and to make such books and records available for inspection by the
Trust or by the Securities and Exchange Commission (the "SEC") at reasonable
times. BISYS shall otherwise keep confidential all books and records relating to
the Trust and its shareholders, except when (i) disclosure is required by law,
(ii) BISYS is advised by counsel that it may incur liability for failure to make
a disclosure, (iii) BISYS is requested to divulge such information by
duly-constituted authorities or court process, or (iv) BISYS is requested to
make a disclosure by a shareholder or shareholder's agent with respect to
information concerning an account as to which such shareholder has either a
legal or beneficial interest or when requested by the Trust or the dealer of
record as to such account. BISYS shall provide the Trust with reasonable advance
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notice of disclosure pursuant to items (i) - (iii) of the previous sentence, to
the extent reasonably practicable. The provisions of this Article 10 are subject
to the provisions of Article 8 .
ARTICLE 11. Reports
BISYS shall furnish to the Trust and to its properly-authorized
auditors, investment advisers, examiners, distributors, dealers, underwriters,
salesmen, insurance companies and others designated by the Trust in writing,
such reports at such times as are prescribed in the Schedules attached hereto,
or as subsequently agreed upon by the parties pursuant to an amendment to a
Schedule hereto. The Trust agrees to examine each such report or copy within
twenty (20) days and will report or cause to be reported any errors or
discrepancies therein. In the event that errors or discrepancies, except such
errors and discrepancies as may not reasonably be expected to be discovered by
the recipient within twenty (20) days after conducting a diligent examination,
are not so reported within the aforesaid period of time, a report will for all
purposes be accepted by and binding upon the Trust and any other recipient, and
if BISYS is not otherwise liable, under the terms of this Agreement, with
respect to the matter or event giving rise to errors or discrepancies therein,
BISYS shall have no further responsibility except to perform reasonable
corrections of such errors and discrepancies in the report within a reasonable
time after being requested to do so by the Trust.
ARTICLE 12. Rights of Ownership
All computer programs and procedures employed or developed by or on
behalf of BISYS to perform services required to be provided by BISYS under this
Agreement are the property of BISYS. All records and other data except such
computer programs and procedures are the exclusive property of the Trust and all
such other records and data shall be furnished to the Trust in appropriate form
as soon as practicable after termination of this Agreement for any reason.
ARTICLE 13. Legal Advice
BISYS shall notify the Trust at any time BISYS believes that it is in
need of the advice of counsel to the Trust with regard to BISYS'
responsibilities and duties pursuant to this Agreement. BISYS may rely upon the
advice of counsel to the Trust; however, this Agreement shall not obligate
counsel to the Trust to render such advice. After so notifying the Trust, if
BISYS does not obtain the advice of counsel to the Trust within a reasonable
period of time, BISYS shall be entitled to seek, receive and act upon advice of
legal counsel of its choosing at the expense of the Trust unless relating to a
matter involving BISYS' willful misfeasance, bad faith, negligence or reckless
disregard of BISYS' responsibilities and duties hereunder. BISYS shall in no
event be liable to the Trust or any Fund or any shareholder or beneficial owner
of the Trust for any action reasonably taken pursuant to legal advice rendered
in accordance with this paragraph.
ARTICLE 14. Return of Records
BISYS may upon termination of this Agreement, and shall promptly upon
the Trust's demand, turn over to the Trust and cease to retain BISYS' files,
records and documents created and maintained by BISYS pursuant to this Agreement
which are no longer needed by BISYS in the performance of Services or for its
legal protection. If not so turned over to the Trust, such documents and records
11
shall be retained by BISYS until at least the earlier of six years from the year
of creation or the termination of this Agreement, unless the Trust authorizes in
writing the destruction of such records and documents.
ARTICLE 15. Bank Accounts
BISYS is hereby granted such power and authority as may be necessary to
establish one or more bank accounts for the Trust with such bank or banks as are
selected or approved by the Trust, as may be necessary or appropriate from time
to time in connection with the services required to be performed hereunder. The
Trust shall be deemed to be the customer of such Bank or Banks for all purposes
in connection with such accounts. To the extent that the performance of such
services hereunder shall require BISYS to disburse amounts from such accounts in
payment of dividends, redemption proceeds or for other purposes hereunder, the
Trust shall provide such bank or banks with all instructions and authorizations
necessary for BISYS to effect such disbursements.
ARTICLE 16. Representations and Warranties of the Trust
The Trust represents and warrants to BISYS that: (a) as of the close of
business on the Effective Date, each Fund which is in existence as of the
Effective Date has authorized unlimited shares, (b) by virtue of its Declaration
of Trust, shares of each Fund which are redeemed by the Trust may be sold by the
Trust from its treasury, and (c) this Agreement has been duly authorized by the
Trust and, when executed and delivered by the Trust, 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.
The Trust also represents and warrants that (a) the Trust has adopted
the written AML Program that has been submitted to BISYS pursuant to Article 19,
and has appointed an officer of the Trust as the Trust's anti-money laundering
compliance officer ("AML Compliance Officer"), (b) the AML Program and the
designation of the AML Compliance Officer have been approved by the Board, and
(c) the delegation of certain services thereunder to BISYS, as provided in
Article 8, has been approved by the Board, and (d) the Trust will submit any
amendments to the AML Program that might have a material impact upon BISYS'
services to BISYS for BISYS' review and consent prior to adoption in accordance
with Article 21.
ARTICLE 17. Representations and Warranties of BISYS
BISYS represents and warrants that: (a) BISYS is and shall continue to
be in compliance in all material respects with all provisions of law, including
Section 17A(c) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), applicable to BISYS in connection with the performance of Services under
this Agreement; (b) the various procedures and systems which BISYS has
implemented with regard to safekeeping from loss or damage attributable to fire,
theft or any other cause of the blank checks, records, and other data of the
Trust and BISYS' records, data, equipment, facilities and other property used in
the performance of its obligations hereunder are adequate and that it will make
such changes therein from time to time as are reasonably required for the secure
performance of its obligations hereunder; and (c) this Agreement has been duly
authorized by BISYS and, when executed and delivered by BISYS, will constitute a
12
legal, valid and binding obligation of BISYS, enforceable against BISYS in
accordance with its terms, subject to bankruptcy, insolvency, reorganization,
moratorium and other laws of general application affecting the right and
remedies of creditors and secured parties.
ARTICLE 18. Insurance
BISYS shall maintain a fidelity bond covering larceny and embezzlement
and an insurance policy with respect to directors and officers errors and
omissions coverage in amounts that are appropriate in light of its duties and
responsibilities hereunder. Upon the request of the Trust, BISYS shall provide
evidence that coverage is in place. BISYS shall notify the Trust should its
insurance coverage with respect to professional liability or errors and
omissions coverage be canceled, or upon BISYS' receipt of notice of cancellation
from its insurance carrier. Such notification shall include the date of
cancellation and the reasons therefor. BISYS shall notify the Trust of any
material claims against it with respect to services performed under this
Agreement, whether or not they may be covered by insurance, and shall notify the
Trust should the total outstanding claims made by BISYS under its insurance
coverage materially impair, or threaten to materially impair, the adequacy of
its coverage.
ARTICLE 19. Information to be Furnished by the Trust
The Trust has furnished to BISYS the following, as amended and current
as of the Effective Date:
(a) Copies of the Declaration of Trust of the Trust and of any
amendments thereto.
(b) Copies of the following documents:
(i) The Trust's Bylaws and any amendments thereto;
(ii) Certified copies of resolutions of the Board covering the
approval of this Agreement and authorization of a specified
officer of the Trust to execute and deliver this Agreement,
and authorization for specified officers of the Trust to
instruct BISYS hereunder; and
(c) A list of all officers of the Trust, with the Trust's AML
Compliance Officer included among the officers therein, and
any other persons (who may be associated with the Trust or its
investment advisor), together with specimen signatures of
those officers and other persons who (except as otherwise
provided herein to the contrary) shall be authorized to
instruct BISYS in all matters.
(d) Prospectus and Statement of Additional Information;
(e) A certificate as to shares of beneficial interest of the Trust
authorized, issued, and outstanding as of the Effective Date
and as to receipt of full consideration by the Trust for all
shares outstanding, such statement to be certified by the
Treasurer of the Trust.
(f) copy of the Trust's written AML Program, including any related
written Policies and Procedures.
13
ARTICLE 20. Information Furnished by BISYS
BISYS has furnished to the Trust copies of, or evidence of, the
following:
(a) Approval of this Agreement by BISYS, and authorization of a specified
officer of BISYS to execute and deliver this Agreement;
(b) BISYS' Articles of Incorporation and any amendments thereto;
(c) BISYS' Bylaws and any amendments thereto;
(d) Executive Summary of BISYS' Disaster Recovery and Business Continuity Plan;
(e) SEC Transfer Agent filings (Forms TA-1 and TA-2);
(f) The most recent annual report of The BISYS Group, Inc.;
(g) The current BISYS "As-of" Trading policy; and
(h) The most recent independent accountant's report covering internal controls
related to BISYS' fund accounting responsibilities and transfer agency
operations, as filed with the SEC pursuant to Rule 17Ad-13 under the Exchange
Act.
ARTICLE 21. Amendments to Documents
The Trust shall furnish BISYS written copies of any amendments to, or
changes in, any of the items referred to in Article 19 hereof forthwith upon
such amendments or changes becoming effective. In addition, the Trust agrees
that no amendments will be made to the Prospectuses or Statement of Additional
Information of the Trust, which might have the effect of changing the procedures
employed by BISYS in providing the services agreed to hereunder or which
amendment might affect the duties of BISYS hereunder unless the Trust first
obtains BISYS' approval of such amendments or changes, which approval shall not
be withheld unreasonably.
BISYS may rely on any amendments to or changes in any of the documents
and other items to be provided by the Trust pursuant to Articles 19 and 21 of
this Agreement and, subject to the provisions of Article 7 hereof, the Trust
agrees to indemnify and holds harmless BISYS from and against any and all
claims, demands, actions, suits, judgments, liabilities, losses, damages, costs,
charges, counsel fees and other expenses of every nature and character which may
result from actions or omissions on the part of BISYS in reasonable reliance
upon such amendments and/or changes. Although BISYS is authorized to rely on the
above-mentioned amendments to and changes in the documents and other items to be
provided pursuant to Articles 19 and 21 hereof, in the event the same relate to
services provided by BISYS hereunder, BISYS shall have no liability for failure
to comply with or take any action in conformity with such amendments or changes
unless the Trust first obtains BISYS' written consent to and approval of such
amendments or changes.
14
ARTICLE 22. Notices
Any notice provided hereunder shall be sufficiently given when sent by
registered mail, overnight courier service or certified mail to the party
required to be served with such notice at the following address: or at such
other address as such party may from time to time specify in writing to the
other party pursuant to this Article.
If to the Trust: USAllianz Variable Insurance Products Fund of Funds Trust
0000 Xxxxxx Xxxxx Xxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Xxxx Xxxxxx
If to BISYS: BISYS Fund Services Ohio, Inc.
0000 Xxxxxxx Xxxx
Xxxxxxxx, Xxxx 00000
Attention: President
ARTICLE 23. Assignment
This Agreement and the rights and duties hereunder shall not be
assignable by either of the parties hereto except by the specific written
consent of the other party. In the case of BISYS, an "assignment" shall be
deemed to include a sale, lease, assignment, transfer or other disposal of all
or a substantial part of the assets of BISYS; provided, however, that BISYS
shall have the right to sell, lease, assign, or otherwise transfer, directly or
indirectly (whether by merger or otherwise) its rights and obligations hereunder
to the extent that no "change of actual control or management" would result
therefrom. It is agreed that for these purposes, the term "change of actual
control or management" shall be construed in a manner consistent with Rule 2a-6
under the 1940 Act and any interpretations of the SEC relative thereto
(including those of the staff of the Division of Investment Management), but
without acknowledging or implying that said provision would otherwise apply to
BISYS or this Agreement by operation of law. This Article 23 shall not limit or
in any way affect BISYS' right to appoint a subcontractor pursuant to Article 2
hereof. This Agreement shall be binding upon, and shall inure to the benefit of,
the parties hereto and their respective successors and permitted assigns.
ARTICLE 24. Activities of BISYS
The services of BISYS rendered to the Trust hereunder are not to be
deemed to be exclusive. BISYS is free to render such services to others and to
have other businesses and interests. It is understood that Trustees, officers,
employees and Shareholders of the Trust are or may be or become interested in
BISYS, as officers, employees or otherwise and that partners, officers and
employees of BISYS and its counsel are or may be or become similarly interested
in the Trust, and that BISYS may be or become interested in the Trust as a
Shareholder or otherwise
ARTICLE 25. Audit Rights
The Trust may, at its own expense, perform an audit of BISYS operations
and procedures in order to evaluate and to assess whether the performance of
Services is consistent with the terms of this Agreement. Such audit may be
15
performed on-site including review of relevant documents and interviews of
appropriate personnel. The audit may be conducted by personnel of or auditors
hired by the Trust. Such audits may be performed once per year during the term
of this Agreement, upon reasonable notice to BISYS, during normal business hours
at a mutually convenient time and in a manner that is not disruptive of BISYS'
operations. The right to conduct any such audit on-site shall be subject to the
obligation to maintain the confidentiality of all proprietary or confidential
information of BISYS and its clients, including all non-public information
concerning BISYS' operations. BISYS may require that any representatives or
agents of the Trust that would be involved in on-site audit activities enter
into a separate confidentiality agreement reflecting the foregoing requirements.
ARTICLE 26. Privacy
Nonpublic personal financial information relating to consumers or
customers of the Trust provided by, or at the direction of the Trust to BISYS,
or collected or retained by BISYS in the course of performing its duties as
transfer agent, shall be considered confidential information. BISYS shall not
give, sell or in any way transfer such confidential information to any person or
entity, other than affiliates of BISYS except at the direction of the Trust or
as required or permitted by law (including Applicable AML Laws). BISYS
represents, warrants and agrees that it has in place and will maintain physical,
electronic and procedural safeguards reasonably designed to protect the
security, confidentiality and integrity of, and to prevent unauthorized access
to or use of records and information relating to consumers or customers of the
Trust. The Trust represents to BISYS that it has adopted a Statement of its
privacy policies and practices as required by the Commission's Regulation S-P
and agrees to provide BISYS with a copy of that statement annually.
ARTICLE 27. Governing Law
This Agreement shall be construed in accordance with the laws of the
state of Ohio and the applicable provisions of the 1940 Act. To the extent that
the applicable laws of the State of Ohio, or any of the provisions herein,
conflict with the applicable provisions of the 1940 Act, the latter shall
control.
ARTICLE 28. Severability
If any provision of this Agreement is construed to be invalid, illegal
or unenforceable, such invalidity or unenforceability shall not invalidate or
render unenforceable the remaining provisions of this Agreement.
ARTICLE 29. Miscellaneous
(a) Paragraph headings in this Agreement are included for convenience only and
are not to be used to construe or interpret this Agreement.
(b) This Agreement constitutes the complete agreement of the parties hereto as
to the subject matter covered by this Agreement, and supersedes all prior
negotiations, understandings and agreements bearing upon the subject matter
covered herein.
(c) This Agreement may be executed in counterparts, each of which shall be an
original but all of which, taken together, shall constitute one and the same
agreement.
16
(d) No amendment to this Agreement shall be valid unless made in writing and
executed by both parties hereto.
* * * * *
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed all as of the day and year first above written.
USALLIANZ VARIABLE INSURANCE PRODUCTS FUND OF FUNDS TRUST
By:
------------------------------------------------
Name:
Title:
BISYS FUND SERVICES OHIO, INC.
By:
------------------------------------------------
Name:
Title:
17
SCHEDULE A
TO THE SERVICES AGREEMENT
BETWEEN USALLIANZ VARIABLE INSURANCE
PRODUCTS FUND OF FUNDS TRUST
AND BISYS FUND SERVICES OHIO, INC.
Funds
USAZ Fusion Balanced Fund
USAZ Fusion Moderate Fund
USAZ Fusion Growth Fund
Services Fees
In accordance with Article 4(a) of the Agreement, the Trust shall pay the
following fees to BISYS as compensation for the Services rendered hereunder. All
fees are per annum and invoiced monthly.
Base Fee: $50,000 per Fund
Additional Share Class: $10,000 per share class per Fund in excess of one (1)
Shareholder servicing: $20 per shareholder per Fund
Out-of-Pocket Expenses and Miscellaneous Charges
In addition to the above fees, BISYS shall be entitled to receive payment for
certain out-of-pocket expenses and miscellaneous charges, as provided in
paragraphs (b) and (c) of Article 4 of the Agreement.
18
SCHEDULE B
TO THE SERVICES AGREEMENT
BETWEEN USALLIANZ VARIABLE INSURANCE
PRODUCTS FUND OF FUNDS TRUST
AND BISYS FUND SERVICES OHIO, INC.
ADMINISTRATION SERVICES
1. Provide the Trustees of the Trust or the Manager with reports regarding the
Funds' investment performance as they may reasonably request.
2. Provide the Trust and the Manager with BISYS's regular report on regulatory
issues.
3. At the request of the Board of Trustees, BISYS shall make reports to the
Trustees concerning the performance of its obligations under this
Agreement.
4. Calculate contractual Trust expenses and control all disbursements for the
Trust.
5. Compute the Trust's yields, total return, expense ratios, portfolio
turnover rate and if required, portfolio average dollar-weighted maturity.
6. Provide Trust counsel with information required in the preparation of
prospectuses, statements of additional information, registration statements
and proxy materials, and any supplements to these materials, if applicable.
7. Coordinate and prepare, with the assistance of the Manager and
sub-advisers, communications to Shareholders, as applicable, including the
annual and semi-annual report to Shareholders.
8. Supervise and facilitate the proxy solicitation process for all Shareholder
meetings.
9. Administer contracts on behalf of the Trust with, among others, the Trust's
sub-advisers, distributor, custodian, transfer agent and fund accountant.
10. Supervise the Trust's transfer agent with respect to the payment of
dividends and other distributions to Shareholders.
11. Calculate performance data of the Funds.
12. Disseminate Fund performance data to information services covering the
investment company industry.
13. Coordinate and supervise the preparation of the Trust's tax returns.
14. Assist with the layout and printing of Prospectuses and assist with and
coordinate layout and printing of the Trust's semi-annual and annual
reports to Shareholders
15. Assist with the design and development of the Funds, including new classes,
investment objectives, policies, structure, and fund combinations,
reorganizations, or liquidations.
19
16. Provide individuals reasonably acceptable to the Trust's Trustees to serve
as officers of the Trust (to serve only in ministerial or administrative
capacities relevant to BISYS' services hereunder, except as otherwise
provided in writing between the parties), upon designation as such by the
Board.
17. Advise the Trust and its Trustees on matters concerning the Trust and its
affairs
18. Obtain and keep in effect at the expense of the Trust a fidelity bond and
trustees and officers errors and omissions insurance policy for the Trust
in accordance with the requirements of Rules 17g-1 and 17d-1(7) under the
1940 Act, and effect any required SEC filings of the bond and policy.
19. Monitor and advise the Trust and its Funds on their regulated investment
company status under the Internal Revenue Code of 1986, as amended.
20. Furnish advice and recommendations with respect to other aspects of the
business and affairs of the Funds as the Trust and BISYS shall determine
desirable.
21. Prepare, edgarize and file with the SEC the semi-annual report for the
Trusts on Form N-SAR and all required notices pursuant on Form 24f-2.
Legal Services
1. Prepare policies and procedures.
2. Prepare amendments to Declaration of Trust and file amendments with
applicable states.
3. Prepare amendments to Bylaws
4. Prepare the following Board meeting materials, and coordinate and handle
dissemination of materials to all relevant parties.
(a) Agenda (b) Resolutions (c) Minutes (d) Trustee memoranda
(e) Presentation materials
5. Attend Board meetings and record minutes
6. Oversee and coordinate proxy solicitations
7. Prepare Shareholder meeting materials
8. Attend Shareholder meeting and record minutes
Compliance Monitoring and Reporting Services - Reports
Assist in developing portfolio compliance procedures and provide compliance
monitoring services incorporating certain of those procedures for each Fund,
including the items covered by the reports listed below as may be relevant to
20
each Fund, as are determinable based upon the Funds' accounting records. All
reports listed below are to be prepared on a daily basis unless otherwise
specified:
1. Rule 2a-7 requirements, including:
(a) Tier 2 percentage (b) Issuer concentration
(c) Weighted average portfolio maturity (d) Maximum maturity (e) Amount of
deviation from amortized cost (weekly) (f) Guarantors - quarterly
2. Single issuer percentage limitation
3. Short sale compliance
4. Fundamental policy and investment objective compliance
5. Foreign issuer test
6. Investment Grade Test
7. Borrowings Test
8. Repo test
9. Industry Concentration
10. Diversification Test
11. Securities related issuers
12. Percentage of when-issued securities
In addition, BISYS will also prepare the following compliance reports, on a
quarterly basis except as otherwise specified below:
(a) SEC Primary Investment Policy Test (monthly) (b) IRS 50% Diversification
Test (c) IRS 25% Single Issuer Test (d) IRS 90% Gross Income Test (e) 817(h)
Diversification Test (f) SEC 25% Industry Test (monthly) (g) Sub-adviser Fund
Brokerage Practices (monthly)
BISYS shall also prepare such other reports as reasonably may be requested by
the Manager.
21
SCHEDULE C
TO THE SERVICES AGREEMENT
BETWEEN USALLIANZ VARIABLE INSURANCE
PRODUCTS FUND OF FUNDS TRUST
AND BISYS FUND SERVICES OHIO, INC.
Fund Accounting Services
1. Keep and maintain all books and records of each Fund as required by
Rules 31a-1 and 31a-2 under the 1940 Act.
2. Calculate the net asset value per share.
3. Obtain security prices from independent pricing services, or if such quotes
are unavailable, or if otherwise required, employ the process determined
under the Trust's fair market valuation procedures and/or obtain pricing
information from the Fund's sub-adviser or its designee, as approved by the
Board.
4. Verify and reconcile with the Trust's custodian all daily trade activity.
5. Compute, as appropriate, each Fund's net income and capital gains, dividend
payables, dividend factors, 7-day yields, 7-day effective yields, 30-day
yields, and weighted average portfolio maturity.
6. Review daily the net asset value calculation and dividend factor (if any)
for each Fund prior to release to Shareholders.
7. Check and confirm the net asset values and dividend factors for
reasonableness and deviations.
8. Distribute net asset values and yields to NASDAQ.
9. Report to the Trust the daily market pricing of securities in any money
market Funds, with the comparison to the amortized basis.
10. Determine unrealized appreciation and depreciation on securities held in
variable net asset value Funds.
11. Amortize premiums and accrete discounts on securities purchased at a price
other than face value, in accordance with the pricing policies that are
established for the Trust.
12. Update the fund accounting system to reflect rate changes, as received from
a Fund's sub-adviser, on variable interest rate instruments.
13. Post Fund transactions to appropriate categories.
14. Accrue expenses of each Fund according to instructions received from the
Fund's Administrator.
22
15. Determine the outstanding receivables and payables for all (1) security
trades, (2) Fund share transactions and (3) income and expense accounts.
16. Provide accounting reports in connection with the Trust's regular annual
audit and other audits and examinations by regulatory agencies
17. Provide such periodic reports as the parties shall agree upon.
18. Provide a monthly download (and hard copy thereof) of the financial
statements described below, upon request of the Trust or the Manager. The
download will consist of:
(a) Unaudited Statement of Assets and Liabilities (b) Unaudited Statement of
Operations (c) Unaudited Statement of Changes in Net Assets (d) Unaudited
Condensed Financial Information
19. Provide accounting information for the following:
(a) the Trust's reports with the SEC on Form N-SAR and N-CSR (b) the Trust's
annual, and semi-annual Shareholder reports
(c) registration statements on Form N-1A and other filings relating to the
registration of shares (d) BISYS' monitoring of each Fund's status as a
regulated investment company under Subchapter M of the Internal
Revenue Code, as amended
(e) Annual audit by the Trust's auditors
(f) Examinations performed by the XXX
00
XXXXXXXX X
TO THE SERVICES AGREEMENT
BETWEEN USALLIANZ VARIABLE INSURANCE
PRODUCTS FUND OF FUNDS TRUST
AND BISYS FUND SERVICES OHIO, INC.
Transfer Agency Services
1. Shareholder Transactions
(a) Process shareholder purchase and redemption orders.
(b) Set up shareholder account information, including address,
dividend option, taxpayer identification numbers and wire
instructions.
(c) Issue shareholder confirmations in compliance with Rule 10b-10
under the Securities Exchange Act of 1934, as amended.
(d) Issue periodic statements for shareholders. (e) Process
transfers and exchanges for shareholders.
(f) Process dividend payments, including the purchase of new
shares, through dividend reimbursement for shareholders.
2. Shareholder Information Services
(a) Make information available to shareholder servicing unit and
other remote access units regarding trade date, share price,
current holdings, yields, and dividend information.
(b) Produce detailed history of transactions through duplicate or
special order statements upon request.
3. Dealer/Load Processing (if applicable)
(a) Calculate fees due under 12b-1 plans for distribution and marketing
expenses.
4. Shareholder Account Maintenance
(a) Maintain all shareholder records for each account in the
Trust.
(b) Issue shareholder statements on scheduled cycle, providing
duplicate second and third party copies if required.
(c) Maintain account documentation files for each shareholder.
5. Anti-Money Laundering Services
(a) Verify shareholder identity upon opening new accounts.
(b) Maintain all records or other documentation related to
shareholder accounts and transactions therein that are
required to be prepared and maintained pursuant to the Trust's
AML Program, and make the same available for inspection by (i)
the Trust's AML Compliance Officer, (ii) any auditor of the
Trust's AML Program or related procedures, policies or
controls that has been designated by the Trust in writing, or
(iii) regulatory or law enforcement authorities, and otherwise
make said records or other documents available at the
direction of the Trust's AML Compliance Officer.
24
Reports
1. Daily Shareholder Activity Journal
2. Daily Fund Activity Summary Report
(a) Beginning Balance (b) Dealer Transactions (c) Shareholder Transactions (d)
Reinvested Dividends (e) Exchanges (f) Adjustments (g) Ending Balance
3. Monthly Dealer Processing Reports
4. Monthly Dividend Reports
5. A copy of the most recent report by independent public accountants
describing control structure policies and procedures relating to transfer
agency operations pursuant to AICPA Statement on Auditing Standards Number
70.
6. Such special reports and additional information that the parties may agree
upon, from time to time.
25
SCHEDULE E
TO THE SERVICES AGREEMENT
BETWEEN USALLIANZ VARIABLE INSURANCE
PRODUCTS FUND OF FUNDS TRUST
AND BISYS FUND SERVICES OHIO, INC.
In the event that BISYS fails to perform the same service standard listed below
during any three (3) consecutive months, the Trust may provide a notice
requiring BISYS to cure said failure. In the event BISYS fails to perform
pursuant to the relevant standard in the month following receipt of such notice,
the Trust shall have the right, exercisable within the next thirty (30) days
only, to terminate this Agreement upon sixty (60) days' notice to BISYS.
For purposes of the foregoing, a "failure to perform" means a failure to meet
the service standard under the terms of the Agreement governing BISYS' Services,
for which BISYS would not be excused and for which BISYS would be responsible
under the Agreement (including, without limitation, under Articles 5 and 9).
The required Performance Level associated with a Function will be measured by
dividing the total number of times that Function was correctly performed during
the month by the total number of times that Function occurred during the month.
EXAMPLE: With respect to, the calculation of NAVs, assuming 22 business days and
9 non-money market funds in existence in Month 1, there should be 198 NAV
calculations in Month 1. If there are 2 NAV errors in Month 1, the Performance
Level for the month is 98.9% (196/198).
An inaccurate calculation of the NAV is defined as when the correct calculation
is $.01 per share or more difference from the originally stated NAV. Such
inaccuracy is considered one event and will only be counted on the day it first
occurred, unless the source of the inaccuracy changes during the relevant
period. An NAV error occurs at the Fund level and not the class level.
It is anticipated that the Funds would not wish to deliver an NAV to NASDAQ if
the accuracy of the NAV is in question at the time it is necessary to transmit
the NAV to NASDAQ. If BISYS has reason to believe that an NAV is or may be
incorrect, it may either "withhold" the NAV from NASDAQ or "withdraw" an NAV
previously submitted, in consultation with the Funds' pricing committee or the
appropriate representative of the Funds. In such event, BISYS shall not be
deemed to have failed to report to NASDAQ by the applicable cut-off time.
[continued on next page]
26
------------------------------------------------------------ ---------------------------------------------------------
FUNCTION/TASK STANDARD PERFORMANCE MEASURE
------------------------------------------------------------ ---------------------------------------------------------
------------------------------------------------------------ ---------------------------------------------------------
Administration
------------------------------------------------------------ ---------------------------------------------------------
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Monthly Compliance Reports: Completed review and results sent no later than10
SEC Compliance Check business days after BISYS' receipt of source reports
Adviser Compliance Reports
IRS Compliance Check
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Fund Accounting
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NAVs accurately completed and reviewed 99% accurately completed and reviewed before publication
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NAVs interfaced with transfer agency system Target time is 6:15 p.m.
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Transfer Agency
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Percentage of accurately processed manual financial 98% entered on the transfer agency system accurately
transactions before pending entries become final
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27
