AGREEMENT OF THE JOINT INSUREDS
THIS AGREEMENT dated December 20, 2001 is hereby entered into by and
between FORT PITT CAPITAL GROUPS, INC. (the "Adviser") and each series of FORT
PITT CAPITAL FUNDS (the "Trust"), and each series as listed on Schedule A, which
may be amended from time to time (the "Fund").
WHEREAS, each Fund is a management investment company registered under the
Investment Company Act of 1940, as amended (the "Act"); and
WHEREAS, Rule 17g-1 under the Act requires each Fund to provide and
maintain in effect a bond against larceny and embezzlement by its officers and
employees; and
WHEREAS, Rule 17g-1 authorizes each Fund to secure a joint insured bond
naming each of them as insureds; and
WHEREAS, Rule 17g-1 also requires that each investment company named as an
insured in a joint bond enter into an agreement with the other named insureds
containing certain provisions regarding the respective shares to be received by
said insureds in the event recovery is received under the joint insured bond as
a result of a loss sustained by them; and
WHEREAS, the Board of Trustees of each Fund, including a majority of the
Trustees who are not "interested persons" of the Trust or any series of the
Trust as defined by Section 2(a)(19) of the Act, have given due consideration to
all factors relevant to the form, amount and ratable allocation of premiums of
such a joint insured bond and have determined that this joint insured bond is in
the best interest of each Fund and its respective shareholders, and,
accordingly, the majority of such Trustees have approved the amount, type, form
and coverage of the joint insured bond and the portion of the premium payable by
each such Fund hereunder; and
WHEREAS, the Trustees have determined, with respect to each Fund, that the
allocation of the proceeds payable under the joint insured bond as set forth
herein, which takes into account the minimum amount of coverage required for
each Fund by Rule 17g-1, is equitable.
NOW, THEREFORE, the parties hereto, in consideration of the mutual
covenants contained herein, hereby agree as follows:
1. Joint Insured Bond. Each Fund shall maintain in effect a joint fidelity
insurance bond (the "Bond") from a reputable fidelity insurance company
authorized to do business in the place where the Bond is issued, insuring each
Fund against larceny and embezzlement and covering such of their respective
officers and employees who may, singly or jointly with others, have access,
directly or indirectly, to the particular Fund's securities or other assets. The
Bond shall name each Fund and the Adviser as an insured and shall comply with
the requirements for such bonds established by Rule 17g-1.
2. Amount. The Bond shall be in a least the minimum amount required by Rule
17g-1(d) to be maintained by the Fund, in accordance with the policies of the
staff of the Securities and Exchange Commission.
3. Ratable Allocation of Premiums. The Fund shall divide the initial
premium and any additional premiums which may become due under the Bond among
them based upon their relative net assets at the time of payment of the premium
involved.
4. Ratable Allocation of Proceeds.
(a) If any Fund sustains a single loss (including a loss sustained
before the date hereof), for which recovery is received under the Bond, the
Fund shall receive that portion of the recovery that is sufficient in
amount to indemnify that Fund in full for the loss sustained by it, unless
the recovery is inadequate to fully indemnify the Fund sustaining a single
loss.
(b) If the recovery is inadequate to fully indemnify the Fund
sustaining a single loss, the recovery shall be allocated among the Fund(s)
or other insureds as follows:
(i) To the extent it sustains a loss, the Fund shall be allocated
an amount equal to the lesser of its actual loss or the minimum amount
of the fidelity bond that it would be required to maintain under a
single insured bond (determined as of the time of the loss in
accordance with the provisions of Rule 17g-1).
(ii) The remainder, if any, shall be allocated among the other
insureds based upon their relative net assets at the time of the loss
(provided that, if such allocation would result in any insured
receiving a portion of the recovery in excess of the loss actually
sustained by it, the aggregate of such excess among such insureds
shall be reallocated among the Fund not fully indemnified as a result
of the foregoing allocations, in proportion to the allocation
percentages set forth in this sub-provision).
5. Claims and Settlements. Within five days after the making of any claim
under the Bond, the insured should provide the other insured party with written
notice of the amount and nature of such claim. The insured shall, within five
days of the receipt thereof, provide the other insureds with written notice of
the terms of settlement of any claim made under the Bond by such insured. In the
event that two or more Funds shall agree to a settlement of a claim made under
the Bond with respect to a single loss, notice of the settlement shall also
include calculation of the amounts to be received under Paragraph 4 hereof. The
officers of the Fund designated as responsible for filing notices required by
paragraph (g) of Rule 17g-1 under the Act shall give and receive any notices
required hereby with respect to such Fund.
6. Modifications and Amendments. Any insured party may increase the amount
of the Bond. Such insured must give written notice thereof to the other Funds to
this Agreement and to the Securities and Exchange Commission in accordance with
Rule 17g-1. If, pursuant to Rule 17g-1, any Fund or other insured party shall
determine that the coverage provided pursuant to this Agreement should otherwise
be modified, it shall so notify the other Funds or insureds hereto and indicate
the nature of the modification (including the treatment of any increase or
return premium) which it believes to be appropriate. If within sixty (60) days
of such notice any necessary amendments to this Agreement shall not have been
made and the request for modification shall not have been withdrawn, this
Agreement shall terminate (except with respect to losses occurring prior to such
termination). Any Fund may withdraw from this Agreement at any time and cease to
be a Fund hereto (except with respect to losses occurring prior to such
withdrawal) by giving not less than sixty (60) days prior written notice to the
other parties of such withdrawal. Upon withdrawal, a withdrawing Fund shall be
entitled to receive such portion of any premium rebated by the fidelity company
with respect to such withdrawal. Upon termination of the Bond, each insured
shall receive any premium rebated by the fidelity company with respect to such
termination in proportion to the premium paid by such insured, less any premium
previously refunded with respect to such insured.
7. Governing Law. This Agreement shall be construed in accordance with the
laws of the State of Pennsylvania.
8. No Assignment. This Agreement is not assignable.
9. Notices. All notices and other communications hereunder shall be
addressed to the appropriate Fund at Fort Pitt Capital Group, Inc., Xxxxxx Plaza
Eleven, 000 Xxxxxxx Xxxxx, Xxxxxxxxxx, Xxxxxxxxxxxx, 00000.
10. Counterparts. This Agreement may be executed in two (2) or more parts
which together shall constitute a single agreement.
IN WITNESS WHEREOF, each of the parties hereto has duly executed this
Agreement as of the day and year first above written.
FORT PITT CAPITAL GROUP, INC.
By:_________________________________________
Name:_______________________________________
Title:______________________________________
FORT PITT CAPITAL FUNDS
on behalf of each series listed on Schedule
A attached hereto
By:_________________________________________
Name:_______________________________________
Title:______________________________________
