ADMINISTRATION AND ACCOUNTING SERVICES AGREEMENT
THIS AGREEMENT is made as of June 12, 2003 by and between PFPC Inc., a
Massachusetts corporation ("PFPC"), and FIRST TRUST VALUE LINE 100 FUND, a
Massachusetts business trust (the "Fund").
W I T N E S S E T H :
WHEREAS, the Fund is registered as a closed-end management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act");
and
WHEREAS, the Fund wishes to retain PFPC to provide administration and
accounting services and PFPC wishes to furnish such services.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, and intending to be legally bound hereby the parties
hereto agree as follows:
1. DEFINITIONS. AS USED IN THIS AGREEMENT:
(a) "1933 Act" means the Securities Act of 1933, as amended.
(b) "1934 Act" means the Securities Exchange Act of 1934, as amended.
(c) "Authorized Person" means any officer of the Fund and any other
person duly authorized by the Fund to give Oral Instructions
and Written Instructions on behalf of the Fund. An Authorized
Person's scope of authority may be limited by setting forth
such limitation in a written document signed by both parties
hereto.
(d) "Shares" mean the shares of beneficial interest of the Fund.
(e) "Oral Instructions" mean oral instructions received by PFPC
from an Authorized Person or from a person reasonably believed
by PFPC to be an Authorized Person. PFPC may, in its sole
discretion in each separate instance, consider and rely upon
instructions it receives from an Authorized Person via
electronic mail as Oral Instructions.
(f) "SEC" means the Securities and Exchange Commission.
(g) "Securities Laws" means the 1933 Act, the 1934 Act and the
1940 Act.
(i) "Written Instructions" mean (i) written instructions signed by
an Authorized Person and received by PFPC or (ii) trade
instructions transmitted (and received by PFPC) by means of an
electronic transaction reporting system access to which
requires use of a password or other authorized identifier. The
instructions may be delivered by hand, mail, tested telegram,
cable, telex or facsimile sending device.
2. APPOINTMENT. The Fund hereby appoints PFPC to provide administration
and accounting services to the Fund, in accordance with the terms set
forth in this Agreement. PFPC accepts such appointment and agrees to
furnish such services.
3. DELIVERY OF DOCUMENTS. The Fund has provided or, where applicable, will
provide PFPC with the following:
(a) at PFPC's request, certified or authenticated copies of the
resolutions of the Fund's board of directors, approving the
appointment of PFPC or its affiliates to provide services to the
Fund and approving this Agreement;
(b) a copy of Fund's most recent effective registration statement;
(c) a copy of the Fund's advisory agreement or agreements;
(d) a copy of the distribution/underwriting agreement with respect
to each class of Interests representing an interest in the Fund;
(e) a copy of each additional administration agreement with
respect to the Fund;
(f) a copy of each distribution and/or shareholder servicing plan
and agreement made in respect of the Fund; and
(g) copies (certified or authenticated, where applicable) of any
and all amendments or supplements to the foregoing.
4. COMPLIANCE WITH RULES AND REGULATIONS.
PFPC undertakes to comply with all applicable requirements of the
Securities Laws, and any laws, rules and regulations of governmental
authorities having jurisdiction with respect to the duties to be
performed by PFPC hereunder. Except as specifically set forth herein,
PFPC assumes no responsibility for such compliance by the Fund or other
entity.
5. INSTRUCTIONS.
(a) Unless otherwise provided in this Agreement, PFPC shall act
only upon Oral Instructions or Written Instructions.
(b) PFPC shall be entitled to rely upon any Oral Instruction or
Written Instruction it receives from an Authorized Person (or
from a person reasonably believed by PFPC to be an Authorized
Person) pursuant to this Agreement. PFPC may assume that any
Oral Instruction or Written Instruction received hereunder is
not in any way inconsistent with the provisions of
organizational documents or this Agreement or of any vote,
resolution or proceeding of the Fund's board of directors or
of the Fund's shareholders, unless and until PFPC receives
Written Instructions to the contrary.
(c) The Fund agrees to forward to PFPC Written Instructions
confirming Oral Instructions (except where such Oral
Instructions are given by PFPC or its affiliates) so that PFPC
receives the Written Instructions by the close of business on
the same day that such Oral Instructions are received. The
fact that such confirming Written Instructions are not
received by PFPC or differ from the Oral Instructions shall in
no way invalidate the transactions or enforceability of the
transactions authorized by the Oral Instructions or PFPC's
ability to rely upon such Oral Instructions.
6. RIGHT TO RECEIVE ADVICE.
(a) Advice of the Fund. If PFPC is in doubt as to any action it
should or should not take, PFPC may request directions or
advice, including Oral Instructions or Written Instructions,
from the Fund.
(b) Advice of Counsel. If PFPC shall be in doubt as to any
question of law pertaining to any action it should or should
not take, PFPC may request advice from counsel of its own
choosing (who may be counsel for the Fund, the Fund's
investment adviser or PFPC, at the option of PFPC).
(c) Conflicting Advice. In the event of a conflict between
directions or advice or Oral Instructions or Written
Instructions PFPC receives from the Fund and the advice PFPC
receives from counsel, PFPC may rely upon and follow the
advice of counsel.
(d) Protection of PFPC. PFPC shall be indemnified by the Fund and
without liability for any action PFPC takes or does not take in
reliance upon directions or advice or Oral Instructions or Written
Instructions PFPC receives from or on behalf of the Fund or from
counsel and which PFPC believes, in good faith, to be consistent
with those directions or advice and Oral Instructions or Written
Instructions. Nothing in this section shall be construed so as to
impose an obligation upon PFPC (i) to seek such directions or
advice or Oral Instructions or Written Instructions, or (ii) to act
in accordance with such directions or advice or Oral Instructions
or Written Instructions.
7. RECORDS; VISITS.
(a) The books and records pertaining to the Fund which are in the
possession or under the control of PFPC shall be the property of
the Fund. Such books and records shall be prepared and maintained
as required by the 1940 Act and other applicable securities laws,
rules and regulations. The Fund and Authorized Persons shall have
access to such books and records at all times during PFPC's normal
business hours. Upon the reasonable request of the Fund, copies of
any such books and records shall be provided by PFPC to the Fund or
to an Authorized Person, at the Fund's expense.
(b) PFPC shall keep the following records:
(i) all books and records with respect to the Fund's books of
account;
(ii) records of the Fund's securities transactions; and
(iii) all other books and records as PFPC is required to
maintain pursuant to Rule 31a-1 of the 1940 Act in
connection with the services provided hereunder.
8. CONFIDENTIALITY. Each party shall keep confidential any information
relating to the other party's business ("Confidential Information").
Confidential Information shall include (a) any data or information
that is competitively sensitive material, and not generally known to
the public, including, but not limited to, information about product
plans, marketing strategies, finances, operations, customer
relationships, customer profiles, customer lists, sales estimates,
business plans, and internal performance results relating to the past,
present or future business activities of the Fund or PFPC, their
respective subsidiaries and affiliated companies and the customers,
clients and suppliers of any of them; (b) any scientific or technical
information, design, process, procedure, formula, or improvement that
is commercially valuable and secret in the sense that its
confidentiality affords the Fund or PFPC a competitive advantage over
its competitors; (c) all confidential or proprietary concepts,
documentation, reports, data, specifications, computer software,
source code, object code, flow charts, databases, inventions,
know-how, and trade secrets, whether or not patentable or
copyrightable; and (d) anything designated as confidential.
Notwithstanding the foregoing, information shall not be subject to
such confidentiality obligations if: (a) release of such information
is necessary or desirable in connection with PFPC's provision of
services under this Agreement; (b) it is already known to the
receiving party at the time it is obtained; (c) it is or becomes
publicly known or available through no wrongful act of the receiving
party; (d) it is rightfully received from a third party who, to the
best of the receiving party's knowledge, is not under a duty of
confidentiality; (e) it is released by the protected party to a third
party without restriction; (f) it is required to be disclosed by the
receiving party pursuant to a requirement of a court order, subpoena,
governmental or regulatory agency or law (provided the receiving party
will provide the other party written notice of such requirement, to
the extent such notice is permitted); (g) it is relevant to the
defense of any claim or cause of action asserted against the receiving
party; or (h) it has been or is independently developed or obtained by
the receiving party.
9. LIAISON WITH ACCOUNTANTS. PFPC shall act as liaison with the Fund's
independent public accountants and shall provide account analyses,
fiscal year summaries, and other audit-related schedules with
respect to the Fund. PFPC shall take all reasonable action in the
performance of its duties under this Agreement to assure that the
necessary information is made available to such accountants for the
expression of their opinion, as required by the Fund.
10. PFPC SYSTEM. PFPC shall retain title to and ownership of any and all
data bases, computer programs, screen formats, report formats,
interactive design techniques, derivative works, inventions,
discoveries, patentable or copyrightable matters, concepts, expertise,
patents, copyrights, trade secrets, and other related legal rights
utilized by PFPC in connection with the services provided by PFPC
to the Fund.
11. DISASTER RECOVERY. PFPC shall enter into and shall maintain in effect
with appropriate parties one or more agreements making reasonable
provisions for emergency use of electronic data processing equipment to
the extent appropriate equipment is available. In the event of
equipment failures, PFPC shall, at no additional expense to the Fund,
take reasonable steps to minimize service interruptions. PFPC shall
have no liability with respect to the loss of data or service
interruptions caused by equipment failure, provided such loss or
interruption is not caused by PFPC's own willful misfeasance, bad
faith, negligence or reckless disregard of its duties or obligations
under this Agreement.
12. COMPENSATION. As compensation for services rendered by PFPC during the
term of this Agreement, the Fund will pay to PFPC a fee or fees as may
be agreed to in writing by the Fund and PFPC.
13. INDEMNIFICATION.
(a) The Fund agrees to indemnify, defend and hold harmless PFPC and its
affiliates, including their respective officers, directors, agents
and employees, from all taxes, charges, expenses, assessments,
claims and liabilities (including, without limitation, reasonable
attorneys' fees and disbursements and liabilities arising under the
Securities Laws and any state and foreign securities and blue sky
laws) ("Claims") arising directly or indirectly from any action or
omission to act which PFPC takes in connection with the provision
of services to the Fund. Neither PFPC, nor any of its affiliates,
shall be indemnified against any liability (or any expenses
incident to such liability) caused by PFPC's or its affiliates' own
willful misfeasance, bad faith, negligence or reckless disregard in
the performance of PFPC's activities under this Agreement. The
provisions of this Section 13 shall survive termination of this
Agreement.
(b) Indemnification of the Fund. PFPC agrees to defend, indemnify and
hold the Fund and its officers, directors and employees harmless
from any and all Claims arising directly or indirectly from the
negligence, bad faith or willful misfeasance of PFPC in the
performance of its duties hereunder. Notwithstanding the foregoing,
the Fund shall not be indemnified against any Claim caused by the
Fund's or the Fund's other service providers' willful misfeasance,
bad faith or negligence.
(c) Indemnification Procedure.
(i) Notice of the Action. A party that seeks indemnification
under this Agreement must promptly give the other party
notice of any legal action; provided, however, that a delay
in notice does not relieve an indemnifying party of any
liability to an indemnified party, except to the extent the
indemnifying party shows that the delay prejudiced the
defense of the action.
(ii) Participating in or Assuming the Defense. The indemnifying
party may participate in the defense at any time or it may
assume the defense by giving notice to the other party. After
assuming the defense, the indemnifying party:
(1) must select an attorney that is satisfactory to the
other party;
(2) is not liable to the other party for any later
attorney's fees or for any other later expenses that
the other party incurs, except for reasonable
investigation costs;
(3) must not compromise or settle the action without
the other party's consent (but the other party must
not unreasonably withhold its consent); and
(4) is not liable for any compromise or settlement
made without its consent.
(iii) Failing to Assume the Defense. If the indemnifying party
fails to participate in or assume the defense within 15 days
after receiving notice of the action, the indemnifying party
is bound by any determination made in the action or by any
compromise or settlement made by the other party.
14. RESPONSIBILITY OF PFPC.
(a) PFPC shall be under no duty to take any action hereunder on
behalf of the Fund except as specifically set forth herein or
as may be specifically agreed to by PFPC and the Fund in a
written amendment hereto. PFPC shall be obligated to exercise
care and diligence in the performance of its duties hereunder
and to act in good faith in performing services provided for
under this Agreement. PFPC shall be liable only for any
damages arising out of PFPC's failure to perform its duties
under this Agreement to the extent such damages arise out of
PFPC's willful misfeasance, bad faith, negligence or reckless
disregard of such duties.
(b) Notwithstanding anything in this Agreement to the contrary,
(i) PFPC shall not be liable for losses, delays, failure,
errors, interruption or loss of data occurring directly or
indirectly by reason of circumstances beyond its reasonable
control, including without limitation acts of God; action or
inaction of civil or military authority; public enemy; war;
terrorism; riot; fire; flood; sabotage; epidemics; labor
disputes; civil commotion; interruption, loss or malfunction
of utilities, transportation, computer or communications
capabilities; insurrection; elements of nature; or
non-performance by a third party; and (ii) PFPC shall not be
under any duty or obligation to inquire into and shall not be
liable for the validity or invalidity, authority or lack
thereof, or truthfulness or accuracy or lack thereof, of any
instruction, direction, notice, instrument or other
information which PFPC reasonably believes to be genuine.
(c) Notwithstanding anything in this Agreement to the contrary,
neither PFPC nor its affiliates shall be liable for any
consequential, special or indirect losses or damages, whether
or not the likelihood of such losses or damages was known by
PFPC or its affiliates.
(d) Each party shall have a duty to mitigate damages for which
the other party may become responsible.
(e) The provisions of this Section 14 shall survive termination
of this Agreement.
15. DESCRIPTION OF ACCOUNTING SERVICES ON A CONTINUOUS BASIS.
PFPC will perform the following accounting services with respect to the
Fund:
(i) Journalize investment, capital share and income and expense
activities;
(ii) Verify investment buy/sell trade tickets when received from
the investment adviser for the Fund (the "Adviser") and
transmit trades to the Fund's custodian (the "Custodian")for
proper settlement;
(iii) Maintain individual ledgers for investment securities;
(iv) Maintain historical tax lots for each security;
(v) Reconcile cash and investment balances of the Fund with the
Custodian, and provide the Adviser with the beginning cash
balance available for investment purposes;
(vi) Update the cash availability throughout the day as required
by the Adviser;
(vii) Post to and prepare the Statement of Assets and Liabilities
and the Statement of Operations;
(viii) Calculate various contractual expenses (e.g., advisory and
custody fees);
(ix) Monitor the expense accruals and notify an officer of the
Fund of any proposed adjustments;
(x) Control all disbursements and authorize such disbursements
upon Written Instructions;
(xi) Calculate capital gains and losses;
(xii) Determine net income;
(xiii) Obtain security market quotes from independent pricing
services approved by the Adviser, or if such quotes are
unavailable, then obtain such prices from the Adviser, and in
either case calculate the market value of the Fund's
Investments;
(xiv) Transmit or mail a copy of the daily portfolio valuation to
the Adviser;
(xv) Compute net asset value; and
(xvi) As appropriate, compute yields, total return, expense ratios,
portfolio turnover rate, and, if required, portfolio average
dollar-weighted maturity.
16. DESCRIPTION OF ADMINISTRATION SERVICES ON A CONTINUOUS BASIS.
PFPC will perform the following administration services with respect to
the Fund:
(i) Prepare quarterly broker security transactions summaries;
(ii) Prepare monthly security transaction listings;
(iii) Supply various normal and customary Fund statistical data as
requested on an ongoing basis;
(iv) Prepare for execution and file the Fund's Federal and state
tax returns;
(v) Monitor the Fund's status as a regulated investment company
under Sub-chapter M of the Internal Revenue Code of 1986, as
amended;
(vi) Prepare and file with the SEC the Fund's annual and semi-
annual shareholder reports;
(vii) Prepare and coordinate with the Fund's counsel post-effective
amendments to the Fund's registration statement on Form N-2,
as needed, and coordinate with the Fund's financial printer
to file such amendments; and prepare and file semi-annual
reports on Form N-SAR, subject to the review of Fund
management;
(viii) Assist in the preparation of notices of annual or special
meetings of shareholders and proxy materials relating to such
meetings;
(ix) Assist in obtaining the fidelity bond and directors' and
officers'/errors and omissions insurance policies for the
Fund in accordance with the requirements of Rule 17g-1 and
17d-1(d)(7) under the 1940 Act as such bond and policies are
approved by the Fund's board of directors;
(x) Monitor the Fund's assets to assure adequate fidelity bond
coverage is maintained;
(xi) Draft agendas, resolutions and materials for quarterly and
special board meetings and draft written consents of the
board;
(xii) Coordinate the preparation, assembly and mailing of board
materials;
(xiii) Attend board meetings and draft minutes thereof;
(xiv) Maintain a calendar to assure compliance with various SEC
filing and board approval deadlines;
(xv) Assist the Fund in the handling of SEC examinations and
responses thereto;
(xvi) If the chief executive officer or chief financial officer of
the Fund is required to provide a certification as part of
the Fund's Form N-SAR or Form N-CSR filing pursuant to
regulations promulgated by the Securities and Exchange
Commission under Section 302 of the Xxxxxxxx-Xxxxx Act of
2002, PFPC will provide (to such person or entity as agreed
between the Fund and PFPC) a sub-certification in support of
certain matters set forth in the aforementioned
certification, such sub-certification to be in such form and
relating to such matters as agreed between the Fund and PFPC
from time to time. PFPC shall be required to provide the
sub-certification only during the term of the Agreement and
only if it receives such cooperation as it may request to
perform its investigations with respect to the
sub-certification. For clarity, the sub-certification is not
itself a certification under the Xxxxxxxx-Xxxxx Act of 2002
or under any other regulatory requirement;
(xvii) Coordinate contractual relationships and communications
between the Fund and its contractual service providers; and
(xviii) Monitor the Fund's compliance with the amounts and conditions
of each state blue sky qualification.
17. DURATION AND TERMINATION.
(a) This Agreement shall be effective on the date first written
above and shall continue for a period of five (5) years (the
"Initial Term").
(b) Upon the expiration of the Initial Term, this Agreement shall
automatically renew for successive terms of one (1) year
("Renewal Terms") each, unless the Fund or PFPC provides
written notice to the other of its intent not to renew. Such
notice must be received not less than ninety (90) days prior
to the expiration of the Initial Term or the then current
Renewal Term.
(c) In the event a termination notice is given by the Fund, all
expenses associated with movement of records and materials and
conversion thereof to a successor accounting and
administration services agent(s) (and any other service
provider(s)), and all trailing expenses incurred by PFPC, will
be borne by the Fund.
(d) If a party hereto is guilty of a material failure to perform
its duties and obligations hereunder (a "Defaulting Party")
the other party (the "Non-Defaulting Party") may give written
notice thereof to the Defaulting Party, and if such material
breach shall not have been remedied within thirty (30) days
after such written notice is given, then the Non-Defaulting
Party may terminate this Agreement by giving thirty (30) days
written notice of such termination to the Defaulting Party.
In all cases, termination by the Non-Defaulting Party shall
not constitute a waiver by the Non-Defaulting Party of any
other rights it might have under this Agreement or otherwise
against the Defaulting Party.
18. NOTICES. Notices shall be addressed (a) if to PFPC, at 000 Xxxxxxxx
Xxxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000, Attention: President; (b) if to
the Fund, at 0000 Xxxxxxxxxxx Xxxx, Xxxxx, XX 00000, Attention: W.
Xxxxx Xxxxxxx or (c) if to neither of the foregoing, at such other
address as shall have been given by like notice to the sender of any
such notice or other communication by the other party. If notice is
sent by confirming telegram, cable, telex or facsimile sending device,
it shall be deemed to have been given immediately. If notice is sent by
first-class mail, it shall be deemed to have been given three days
after it has been mailed. If notice is sent by messenger, it shall be
deemed to have been given on the day it is delivered.
19. AMENDMENTS. This Agreement, or any term thereof, may be changed or
waived only by written amendment, signed by the party against whom
enforcement of such change or waiver is sought.
21. ASSIGNMENT. PFPC may assign its rights hereunder to any majority-owned
direct or indirect subsidiary of PFPC or of The PNC Financial Services
Group, Inc., provided that PFPC gives the Fund 30 days prior written
notice of such assignment.
22. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
23. FURTHER ACTIONS. Each party agrees to perform such further acts and
execute such further documents as are necessary to effectuate the
purposes hereof.
24. MISCELLANEOUS.
(a) Notwithstanding anything in this Agreement to the contrary,
the Fund agrees not to make any modifications to its
registration statement or adopt any policies which would
affect materially the obligations or responsibilities of PFPC
hereunder without the prior written approval of PFPC, which
approval shall not be unreasonably withheld or delayed.
(b) Except as expressly provided in this Agreement, PFPC hereby
disclaims all representations and warranties, express or
implied, made to the Fund or any other person, including,
without limitation, any warranties regarding quality,
suitability, merchantability, fitness for a particular
purpose or otherwise (irrespective of any course of dealing,
custom or usage of trade), of any services or any goods
provided incidental to services provided under this
Agreement. PFPC disclaims any warranty of title or
non-infringement except as otherwise set forth in this
Agreement.
(c) This Agreement embodies the entire agreement and
understanding between the parties and supersedes all prior
agreements and understandings relating to the subject matter
hereof, provided that the parties may embody in one or more
separate documents their agreement, if any, with respect to
delegated duties. The captions in this Agreement are included
for convenience of reference only and in no way define or
delimit any of the provisions hereof or otherwise affect
their construction or effect. Notwithstanding any provision
hereof, the services of PFPC are not, nor shall they be,
construed as constituting legal advice or the provision of
legal services for or on behalf of the Fund or any other
person.
(d) This Agreement shall be deemed to be a contract made in
Delaware and governed by Delaware law, without regard to
principles of conflicts of law.
(e) If any provision of this Agreement shall be held or made
invalid by a court decision, statute, rule or otherwise, the
remainder of this Agreement shall not be affected thereby.
This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors
and permitted assigns.
(f) The facsimile signature of any party to this Agreement shall
constitute the valid and binding execution hereof by such
party.
(g) The Fund and PFPC agree that the obligations of the Fund
under the Agreement shall not be binding upon any of the
directors, shareholders, nominees, officers, employees or
agents, whether past, present or future, of the Fund
individually, but are binding only upon the assets and
property of the Fund (or applicable series thereof), as
provided in the Declaration of Trust. The execution and
delivery of this Agreement have been authorized by the
directors of the Fund, and signed by an authorized officer of
the Fund, acting as such, and neither such authorization by
such directors nor such execution and delivery by such
officer shall be deemed to have been made by any of them or
any shareholder of the Fund individually or to impose any
liability on any of them or any shareholder of the Fund
personally, but shall bind only the assets and property of
the Fund (or applicable series thereof), as provided in the
Articles of Incorporation or Declaration of Trust.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and year first above written.
PFPC INC.
By: /s/ Xxxx X. Xxxxxxx
-----------------------
Name: Xxxx X. Xxxxxxx
Title: Senior Vice President
FIRST TRUST VALUE LINE 100 FUND
By: /s/ Xxxxx X. Xxxxx
-------------------------
Name: Xxxxx X. Xxxxx
Title: President
