Exhibit (h)(2)
ADMINISTRATION AND SHAREHOLDER SERVICES AGREEMENT
ADMINISTRATION AND SHAREHOLDER SERVICES AGREEMENT, made this 13th day of
June, 2001 between Pacific Funds (the "Fund"), a Delaware business trust, and
Pacific Life Insurance Company (the "Administrator"), an insurance company
domiciled under the laws of California.
WHEREAS, the Fund is registered with the Securities and Exchange Commission
("SEC") as an open-end management investment company under the Investment
Company Act of 1940, as amended (the "1940 Act"); and
WHEREAS, the Fund is authorized to issue shares of beneficial interest in
separate series with each such series representing interests in a separate
portfolio of securities and other assets; and
WHEREAS, the Fund initially established twelve series, which are designated
in Schedule A hereto, such initial series together with any other series
subsequently established by the Fund, with respect to which the Fund desires to
retain the Administrator to provide or procure administrative and shareholder
services hereunder in the manner and on the terms set forth below, and with
respect to which the Administrator is willing to do so, being herein
collectively referred to also as the "Portfolios"; and
WHEREAS, the Administrator is willing to provide or procure such services
in the manner and on the terms hereinafter set forth.
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, the parties agree as follows:
1. Appointment. The Fund hereby appoints the Administrator to provide or
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procure the administrative and shareholder services with respect to the
Portfolios for the period and on the terms set forth in this Agreement. The
Administrator accepts such appointment and agrees during such period to provide
or procure the services herein set forth for the compensation herein provided.
In the event the Fund establishes and designates additional series with
respect to which it desires to retain the Administrator to provide or procure
administrative and other services hereunder, it shall notify the Administrator
in writing. If the Administrator is willing to provide or procure such services
it shall notify the Fund in writing, whereupon such additional series shall
become a Portfolio hereunder by amendment to Schedule A hereto.
2. Duties. Subject to the general supervision of the Board of Trustees, the
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Administrator shall provide or procure the services set forth in subsections
(a)-(d) below:
(a) Administrative Services. The Administrator shall procure, on behalf
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of the Fund, the following administrative services with respect to the Fund: (i)
coordination of matters relating to the operation of the Portfolios, including
any necessary coordination among the adviser and sub-advisers to the Portfolios,
the custodian, transfer agent, sub-transfer agent, dividend disbursing agent,
and recordkeeping agent (including pricing and valuation of the Portfolios),
accountants, attorneys, sub-administrators and other parties performing services
or operational functions for the Portfolios; (ii) retention of a sufficient
number of persons competent to perform such administrative and clerical
functions as are necessary to provide effective administration of the Fund;
(iii) maintenance of such books and records of the Fund as may be required by
applicable federal law or regulation; (iv) preparation of all federal, state,
local and foreign tax returns and reports of the Fund required by applicable law
and review of such records for compliance with regulation, including applicable
federal and state tax and securities regulation; (v) performance of general
compliance monitoring and oversight with respect to all applicable federal,
state or foreign law or regulation; (vi) preparation, filing and distribution of
prospectuses, proxy
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materials and periodic reports to shareholders of the Fund as required by
applicable law and arrangement of shareholder meetings; (vii) preparation and
filing of such registration statements and other documents with the SEC and
other federal and state regulatory authorities as may be required to register
the shares of the Fund and qualify the Fund to do business or as otherwise
required by applicable law; (viii) arrangement of meetings of the Fund's Board
of Trustees and, in connection therewith, provision of necessary or appropriate
information or materials for its meetings; (ix) provision of statistical or
research data, other than that provided by the investment sub-advisers to the
Portfolios, and such other reports, evaluations and information as the Fund may
reasonably request from time to time; (x) provisions of such other
administrative services with respect to the Fund, as may be required by
applicable law or regulation, including, without limitation, the rules and
regulations of the SEC and of state securities commissions and other regulatory
agencies; (xi) provision of adequate personnel, office space, communications
facilities, and other facilities necessary for the Fund's operations as
contemplated in this Agreement; (xii) provision of services as the Fund's
accounting agent and calculation of the net asset value of the Portfolios in
accordance with applicable law and regulation and the Registration Statement of
the Fund on Form N-1A as amended from time to time ("Registration Statement");
and (xiii) provision of such other administrative services as may be specified
by agreement of the Fund and the Administrator or from time to time procured by
the Administrator on behalf of the Fund, pursuant to a sub-administration
agreement relating to such services. The Fund may be a party to any sub-
administration or similar agreement related to such services, which agreement
may provide that the Fund will be responsible for all or a portion of the costs
and expenses related to the services provided thereunder.
(b) Shareholder Services. The Administrator shall provide or procure
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shareholder services with respect to the Fund, at the expense of the
Administrator, including receiving and responding to inquiries and instructions
from shareholders or their agents or representatives relating to the Fund,
concerning, among other things, share transactions or account information, or
referring any such inquiries to the Fund's officers or appropriate agents.
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(c) Transfer Agency Services. The Administrator shall procure, on
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behalf of the Fund, transfer agency, dividend disbursement agency, registrar and
certain shareholder agency services from an entity qualified to provide such
services to the Fund. The Fund may be a party to any agreement related to such
services, which agreement may provide that the Fund will be responsible for all
or a portion of the costs and expenses related to the services provided
thereunder.
(d) Support Services. The Administrator shall make its officers and
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employees available to the Board of Trustees and officers of the Fund for
assistance, consultation and discussion regarding the administration of the Fund
and the services provided to the Fund under this Agreement. The Fund shall
compensate the Administrator at cost in accordance with Section 4(b) of this
Agreement for the time of legal, accounting, and compliance personnel of the
Administrator, including individuals who may be officers or Trustees of the Fund
("Personnel"), spent providing assistance, coordination, and supervision in
connection with the services procured for the Fund under this Agreement,
including time spent by such personnel in attendance at meetings of the Board of
Trustees (a "Covered Activity").
(e) In performing or procuring these services, the Administrator:
(i) shall conform with the 1940 Act and all rules and regulations
thereunder, all other applicable federal and state laws and
regulations, with any applicable procedures adopted by the Fund's
Board of Trustees, and with the provisions of the Fund's Registration
Statement.
(ii) shall, in rendering services or in procuring the services of
third parties under this Agreement, seek to maintain standards of
service that are consistent with those prevailing in the mutual fund
industry.
(iii) will make available to the Fund, promptly upon request,
any of the Fund's books and records as are maintained by the
Administrator under this Agreement,
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and will furnish to regulatory authorities having the requisite
authority any such books and records and any information or reports in
connection with the Administrator's services under this Agreement that
may be requested in order to ascertain whether the operations of the
Fund are being conducted in a manner consistent with applicable laws
and regulations.
(iv) will regularly report to the Fund's Board of Trustees on the
services provided or procured under this Agreement and will furnish
the Fund's Board of Trustees with respect to such services such
periodic and special reports as the Trustees may reasonably request.
3. Documentation. The Fund has delivered copies of each of the following
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documents to the Administrator and will deliver to it all future amendments and
supplements thereto, if any:
(a) the Fund's Registration Statement; and
(b) exhibits, powers of attorneys, certificates and any and all other
documents relating to or filed in connection with the Registration Statement.
4. Compensation. (a) As compensation for procuring the administrative and
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transfer agency services as set forth in Sections 2(a) and (c) of this Agreement
and providing the shareholder services set forth in Section 2(b) of this
Agreement, the Fund shall pay to the Administrator a fee at an annual rate of
0.35% of the average daily net assets of each of the Portfolios. The fees
payable to the Administrator for all of the Portfolios shall be computed and
accrued daily and paid monthly. If the Administrator shall serve for less than
any whole month, the foregoing compensation shall be prorated.
(b) As compensation for providing the support services as set forth in
Section 2(d) of this Agreement, the Administrator shall xxxx the Fund at cost
based on an internal billing rate determined by the Administrator and calculated
pursuant to a reasonable methodology for the time spent by Personnel
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in providing the Covered Activities, including for time spent by Personnel in
providing Covered Activities in connection with the initial organization of the
Fund prior to the date of this Agreement, and the Fund shall compensate the
commissions and transfer taxes in connection with the purchase and sale of
securities for the Fund; investment advisory fees; taxes, insurance premiums,
interest on borrowed funds, and other fees and expenses applicable to its
operation; costs related to the custody of the Fund's assets (including custody
of assets outside of the United States); costs incidental to any meetings of
shareholders including, but not limited to, legal and accounting fees, proxy
filing fees and the costs of preparation, printing and mailing of any proxy
materials (except to the extent it is agreed that the Administrator or a third
party shall bear a portion or all of such expenses); costs incidental to Board
meetings, including fees and expenses of Board members; the salary and expenses
of any officer, Trustee or employee of the Fund (except any such officer,
Trustee or employee who is an officer, employee, Trustee or director of the
Administrator or an affiliate of the Administrator); costs incidental to the
preparation, printing and distribution of the Fund's Registration Statements and
any amendments thereto and shareholder reports; cost that may properly be borne
by the Fund of typesetting and printing of prospectuses; cost of preparation and
filing of the Fund's tax returns, Form N-1A and Form N-SAR, and all filings,
notices, registrations and amendments associated with applicable federal, state
and foreign tax and securities laws; all applicable registration fees and filing
fees required under federal and state securities laws; fidelity bond and
directors' and officers' liability insurance; and costs of independent pricing
services used in computing each Portfolio's net asset value.
7. Liability. The Administrator shall give the Fund the benefit of the
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Administrator's reasonable best efforts and diligence in rendering services
under this Agreement. The Administrator may rely on information reasonably
believed by it to be accurate and reliable. As an inducement for the
Administrator's undertaking to render services under this Agreement, the Fund
agrees that neither the Administrator nor its stockholders, officers, directors,
or employees shall be subject to any liability for, or any damages, expenses or
losses (a "Loss") incurred in connection with, any act or omission or mistake in
judgment connected with or arising out of (i) any services rendered by the
Administrator under this Agreement, or (ii) any services rendered by a third
party whose services were procured by the
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Administrator under this Agreement, except by reason of willful misfeasance, bad
faith, or negligence by the Administrator in performance of the Administrator's
duties, or by reason of reckless disregard by the Administrator of the
Administrator's obligations and duties under this Agreement; provided, however,
that in the event any Loss occurs in connection with any act or omission or
mistake in judgment arising out of any services rendered by a third party as
described in item (ii) of this paragraph and such third party is subject to a
lesser standard of care than that set forth above, then the Administrator shall
be held to the same standard of care as such third party with respect to any
claim against the Administrator hereunder in connection with such Loss. This
provision shall govern only the liability to the Fund of the Administrator and
that of its stockholders, officers, directors, and employees, and shall in no
way govern the liability to the Fund or the Administrator by, or provide a
defense for, any other person, including persons that provide sub-
administration, transfer agency, or other services to the Fund as described in
Section 2 of this Agreement.
8. Term and Continuation. This Agreement shall take effect as of the date
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indicated above, and shall remain in effect, unless sooner terminated as
provided herein, through December 31, 2002, and shall continue thereafter on an
annual basis with respect to each Portfolio provided that such continuance is
specifically approved at least annually by the vote of a majority of the Board
of Trustees of the Fund, and provided continuance is also approved by the vote
of a majority of the Board of Trustees of the Fund who are not parties to this
Agreement or "interested persons" (as defined in the 0000 Xxx) of the Fund, or
the Administrator.
This Agreement may be terminated:
(a) by the Fund at any time, without the payment of any penalty, with
respect to the services procured or provided by the Administrator, by vote
of a majority of the entire Board of Trustees of the Fund on 60 days'
written notice to the Administrator;
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(b) by the Administrator at any time, without the payment of any
penalty, upon 60 days' written notice to the Fund.
9. Use of Name. It is understood that the name "Pacific Life Insurance
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Company," "Pacific Life," and "Pacific Funds" or any derivative thereof or logo
associated with those names are the valuable property of the Administrator and
its affiliates, and that the Fund and/or the Portfolios shall use such names (or
derivatives or logos) only so long as this Agreement or an agreement between the
Fund and the Administrator related to the investment management of the
Portfolios ("Investment Advisory Agreement") is in effect. Upon termination of
this Agreement and any Investment Advisory Agreement with respect to a
Portfolio, the Fund (or Portfolio) shall forthwith cease to use such name (or
derivative or logo) and, in case of the Fund, shall promptly amend its
Certificate of Trust to change its name.
10. Notices. Notices of any kind to be given to the Administrator by the
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Fund shall be in writing and shall be duly given if mailed or delivered to the
Administrator at 000 Xxxxxxx Xxxxxx Xxxxx, Xxxxxxx Xxxxx, Xxxxxxxxxx 00000,
attn: Xxxxx X. Xxxxx, or to such other address or to such individual as shall be
specified by the Administrator. Notices of any kind to be given to the Fund by
the Administrator shall be in writing and shall be duly given if mailed or
delivered to 000 Xxxxxxx Xxxxxx Xxxxx, Xxxxxxx Xxxxx, Xxxxxxxxxx 00000, attn:
Xxxxxx Xxxxxx, or to such other address or to such individual as shall be
specified by the Fund.
11. Fund Obligation. A Copy of the Fund's Certificate of Trust is on file
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with the State of Delaware and notice is hereby given that the Agreement has
been executed on behalf of the Fund by a Trustee or officer of the Fund in his
or her capacity as such and not individually. The obligations of this Agreement
shall only be binding upon the assets and property of the Fund and shall not
be binding upon any Trustee, officer, or shareholder of the Fund individually.
Further, the debts, liabilities, obligations and expenses incurred or contracted
for hereunder with respect to a Portfolio shall be enforceable against the
assets of that Portfolio only and not against the assets of the Fund generally
or any other Portfolio.
12. Counterparts. This Agreement may be executed in one or more
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counterparts, each of which shall be deemed to be an original.
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13. Miscellaneous. (a) This Agreement shall be governed by the laws of
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Delaware, provided that nothing herein shall be construed in a manner
inconsistent with the 1940 Act, the Investment Advisers Act of 1940, or any rule
or order of the SEC thereunder.
(b) 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 and, to this extent, the provisions of this
Agreement shall be deemed to be severable. To the extent that any provision of
this Agreement shall be held or made invalid by a court decision, statute, rule
or otherwise with regard to any party hereunder, such provisions with respect to
other parties hereto shall not be affected thereby.
(c) The captions in this Agreement are included for convenience only
and in no way define any of the provisions hereof or otherwise affect their
construction or effect.
(d) This Agreement may not be assigned by the Fund or the
Administrator without the consent of the other party.
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IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed by their officers designated below on the day and year first above
written.
PACIFIC FUNDS
By: /s/ Xxxxx X. Xxxxxxx
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Name: Xxxxx X. Xxxxxxx
Title: President
PACIFIC LIFE INSURANCE COMPANY
By: /s/ Xxxxx X. Xxxxxxx
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Name: Xxxxx X. Xxxxxxx
Title: President
By: /s/ Xxxxxx X. Milfs
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Name: Xxxxxx X. Milfs
Title: Vice President & Secretary
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Schedule A
Portfolios of the Pacific Funds subject to this Administration and Shareholder
Servicing Agreement.
PF AIM Blue Chip Fund
PF AIM Aggressive Growth Fund
PF INVESCO Health Sciences Fund
PF INVESCO Technology Fund
XX Xxxxx Strategic Value Fund
XX Xxxxx Growth LT Fund
XX Xxxxxx International Value Fund
PF MFS Mid-Cap Growth Fund
PF MFS Global Growth Fund
PF PIMCO Managed Bond Fund
PF Pacific Life Money Market Fund
XX Xxxxxxx Brothers Large-Cap Value Fund
Date: June 13, 2001
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