AMENDED AND RESTATED SERVICES AGREEMENT
AMENDED AND RESTATED AGREEMENT made as of the 1st day of
November, 2006, (the "Agreement") between ALLIANZ 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 and BISYS entered into a Services Agreement
as of April 13, 2005 (the "2005 Agreement"), whereby BISYS agreed to perform
administration, fund accounting, and transfer agency services to the Trust and
the series portfolios of the Trust, and which, as amended, has continued in
effect through the date hereof;
WHEREAS, the Trust and BISYS entered into a Compliance
Services Amendment to the 2005 Agreement, as of April 13, 2005 ("Compliance
Services Agreement," and together with the 2005 Agreement, the "Prior
Agreements"), whereby BISYS agreed to perform compliance services for the Trust
and which has continued in effect through the date hereof;
WHEREAS, the Trust desires that BISYS continue to perform the
administration, fund accounting, transfer agency and certain compliance services
(as modified by the terms of this Agreement) 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 "Portfolio," and collectively as the "Portfolios");
WHEREAS,BISYS is willing to perform such services on the terms
and conditions set forth in this Agreement; and
WHEREAS, BISYS and the Trust wish to enter into a new
Agreement in order to set forth the terms under which BISYS will perform
administration, fund accounting, transfer agency and compliance services
(collectively, "Services") for the Trust.
NOW, THEREFORE, in consideration of the covenants hereinafter
contained, the Trust and BISYS hereby agree as follows:
ARTICLE 1. SERVICES.
A. ADMINISTRATIVE SERVICES. On behalf of the Trust and each of the
Portfolios, 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 Portfolio'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 Portfolios 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
shall perform only such additional services as described by 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
Portfolios 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 agent 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 Portfolios 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.
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D. COMPLIANCE SERVICES. BISYS shall perform for the Trust the
compliance services set forth in Schedule E hereto. The parties mutually agree
to coordinate and cooperate in connection with the creation and maintenance of
written compliance policies and procedures (the "Fund Compliance Program")
which, in the aggregate, shall be deemed by the Board to be reasonably designed
to prevent the Trust from violating the provisions of the Federal securities
laws applicable to the Trust (the "Applicable Securities Laws"), as required
under Rule 38a-1 under the 1940 Act. Except as explicitly set forth herein
(including Schedule E), BISYS shall perform only such additional compliance
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.
E. CERTAIN DEADLINES AND SERVICE STANDARDS. From time to time, the
Trust may propose certain deadlines and service standards applicable to BISYS'
provision of the Services or certain aspects of the Services, and such service
standards shall be set forth as Schedule F to this Agreement. Notwithstanding
the effective date of this Agreement, Schedule F 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 F is effective, BISYS agrees to perform the relevant Services in
accordance with and otherwise comply with the provisions set forth in Schedule
F. 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 F 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.
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
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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 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 obtaining security and issuer
information;
(iv) The cost of CD-ROM, computer disks, microfilm, or
microfiche, and storage of records or other materials
and data;
(v) 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;
(vi) All copy charges;
(vii) The reasonable travel, lodging and other expenses
incurred by officers and employees of BISYS in
connection with attendance at Board meetings or the
performance of any due diligence of the Service
Providers (as defined in Schedule E of this
Agreement), if such due diligence is requested by the
Trust;
(viii) Any expenses BISYS shall incur at the written
direction of the Trust or an officer of the Trust
thereunto duly authorized;
(ix) Reasonable costs incurred by BISYS in connection with
the performance of services in addition to those
contemplated by this Agreement and requested in
writing by the Chief Compliance Officer under the
Fund Compliance Program; and
(x) 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:
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(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;
(vi) Charges for the pricing information obtained from
third party vendors for use in pricing the securities
of each Portfolio's investment portfolio pursuant to
Schedule B, which shall not exceed the amounts that
would be incurred if the Portfolio 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.
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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, (a) BISYS
shall follow applicable procedures in its disaster recovery and business
continuity plan, (b) BISYS shall use all commercially reasonable efforts to
minimize any service interruption, and (c) Schedule F shall be applicable during
any such force majeure event or disaster. 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.
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.
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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
dateYear2007Day31Month12December 31, 2007 (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 F. Written
notice of nonrenewal must be provided at least sixty (60) 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.
Except as specifically provided below in this paragraph, BISYS shall be
entitled to collect from the Trust the amount of all of BISYS' reasonable 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
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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 F, 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 Portfolios 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 Portfolio 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 Portfolios 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 Portfolio are
initially acquired or otherwise transferred from another investment vehicle. In
addition, it is understood and agreed that Allianz Life 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 Allianz Life
Advisers LLC and its affiliates.
Except as provided in the above paragraph, in the event the Trust or
any Portfolio 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, reasonable counsel fees,
disbursements, payments and expenses (including reasonable investigation
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 harmless the Trust, its
employees, agents, trustees, 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, reasonable counsel fees and
disbursements, payments and expenses (including reasonable investigation
expenses) resulting directly and proximately from BISYS' bad faith, willful
misfeasance 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.
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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
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 Portfolios 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
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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.
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 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 and the other documents of the Trust furnished to BISYS
pursuant to Articles 19 and 21 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.
12
The Trust acknowledges and agrees that deviations from BISYS' written
transfer agent compliance procedures may involve a substantial risk of loss. In
the event an authorized representative of the Trust (other than an officer or
employee of BISYS or its affiliates) requests that an exception be made from any
written compliance or transfer agency procedures adopted by BISYS, or any
requirements of the AML Program, BISYS may in its sole discretion determine
whether to permit such exception. In the event BISYS determines to permit such
exception, the same shall become effective when set forth in a written
instrument executed by an authorized representative of the Trust (other than an
officer or employee of BISYS or its affiliates) and delivered to BISYS (an
"Exception"); provided that an Exception concerning the requirements of the
Trust's AML Program shall also be authorized by the Trust's AML Compliance
Officer (as defined in Article 16 of this Agreement). An Exception shall be
deemed to remain effective until the relevant instrument expires according to
its terms (or if no expiration date is stated, until BISYS receives written
notice from the Trust that such instrument has been terminated and the Exception
is no longer in effect). Notwithstanding any provision in this Agreement that
expressly or by implication provides to the contrary, as long as BISYS acts in
good faith, BISYS shall have no liability for any loss, liability, expenses or
damages to the Trust resulting from the Exception, and the Trust shall indemnify
BISYS and hold BISYS harmless from any loss, liability, expenses (including
reasonable attorneys fees) and damages resulting to BISYS therefrom.
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
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,
13
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
shall be retained by BISYS until at least the earlier of six years from the year
14
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 Portfolio which is in existence as of the
Effective Date has authorized unlimited shares of beneficial interest, (b) by
virtue of its Declaration of Trust, shares of beneficial interest of each
Portfolio which are redeemed by the Trust may be sold by the Trust from its
treasury, (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, and (d) the list of officers provided to BISYS pursuant to
Article 19 is accurate and complete as of the Effective Date, and the Trust will
notify BISYS promptly of any changes in the Trust's officers.
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
15
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
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:
1. The Trust's By-Laws and any amendments thereto;
2. Certified copies of resolutions of the Board
covering the approval of this Agreement and
authorization the officers of the Trust to
execute and deliver this Agreement, and
authorization for the officers of the Trust
to instruct BISYS hereunder; and
16
(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) A copy of the Trust's written AML Program, including
any related written Policies and Procedures.
(g) A copy of the Fund Compliance Program or the various
policies and procedures of the Trust that have been
adopted through the date hereof which pertain to
compliance matters that are required to be covered by
the Fund Compliance Program, including the compliance
programs of Service Providers other than BISYS, as
necessary under Rule 38a-1 for inclusion in the Fund
Compliance Program in accordance with Schedule E of
this Agreement.
(h) The Trust's disclosure and control procedures (the
"DCPs").
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);
17
(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 will
provide BISYS with advance notice of any material amendments to the items set
forth in Article 19 which might have the effect of changing the procedures
employed by BISYS in providing the services hereunder or affecting the duties of
BISYS hereunder. BISYS will not be responsible for changing or conforming its
services to any such amendments until BISYS has reviewed and accepted
responsibility for the relevant changes in services. BISYS will consider such
changes in good faith. In the event that any such amendment, or change in laws
applicable to the Trust would require BISYS to make specific changes to its
service model, BISYS will use reasonable good faith efforts to inform the Trust
of the changes that would be necessary, and set out the estimated costs and
estimated implementation timetable for any additional services. The parties
shall then in good faith agree to mutually agreeable terms applicable to such
additional service.
BISYS may reasonably rely on any documents provided pursuant to
Articles 19 and 21 and 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 hold harmless BISYS. 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.
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 Section.
18
If to the Trust: Allianz VIP Fund of Funds
0000 Xxxxxx Xxxxx Xxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Xxxxxxx Xxxxxx
Copy to: H. Xxxxx xxx Xxxxx, Chief Legal Officer
Allianz Life Advisers, LLC
0000 Xxxxxx Xxxxx Xxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
If to BISYS: BISYS Fund Services Ohio, Inc.
0000 Xxxxxxx Xxxx
Xxxxxxxx, Xxxx 00000
Attention: Xxxx Xxxxxxx
Copy to: The BISYS Group, Inc.
000 Xxxxxxxxxx Xxxxxxx
Xxxxxxxx, XX 00000
Attention: General Counsel
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 any of the following:
(a) any direct or indirect transfer or hypothecation of this Agreement,
or of 25% or more of the outstanding voting securities by security holders of
The BISYS Group, Inc. ("BSG"), BISYS or BISYS Fund Services, Inc. ("BFS")
(whether or not such security holders act collectively);
(b) the issuance by BSG of 25% or more of its voting securities;
(c) a sale, lease, assignment, transfer or other disposition of all or
a substantial part of the assets of any of the following:
(i) BSG; (ii) BISYS; or
(iii) BISYS Fund Services, Inc.; or
(d) a merger, consolidation, share exchange, or other similar corporate
transaction between BSG, BISYS or BFS and another entity (or entities) following
19
which BSG, BISYS or BFS shareholders (prior to the transaction) end up with less
than a majority of the outstanding equity securities of the combined entity or
entities (following the transaction).
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
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
20
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 supercedes all prior negotiations,
understandings and agreements bearing upon the subject matter
covered herein, including, without limitation, the Prior
Agreements.
(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.
(d) No amendment to this Agreement shall be valid unless made in
writing and executed by both parties hereto.
* * * * *
21
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed all as of the day and year first above written.
ALLIANZ VARIABLE INSURANCE
PRODUCTS FUND OF FUNDS
By: /s/ Xxxxxxx Xxxxxx
Title: President
BISYS FUND SERVICES OHIO, INC.
By: /s/ Xxxx Xxxxxx
Title: President
22
SCHEDULE A
TO THE AMENDED AND RESTATED SERVICES AGREEMENT
BETWEEN
ALLIANZ VARIABLE INSURANCE PRODUCTS
FUND OF FUNDS TRUST
AND
BISYS FUND SERVICES OHIO, INC.
PORTFOLIOS
AZL Fusion Balanced Fund
AZL Fusion Moderate Fund
AZL Fusion Growth Fund
SERVICES FEES
In accordance with Article 4, paragraph (a) of the Agreement, the Trust shall
pay the following fees to BISYS as compensation for the Services rendered
hereunder. All fees shall be aggregated and paid monthly.
A. ANNUAL BASE FEE
There will be an annual base fee of $50,000 per Fund.
B. ADDITIONAL CLASS FEE
In addition to the fees payable under paragraphs a. above, in the event there
are additional classes of shares of any Portfolio, there shall be a fee of
$10,000 annually for each such additional class of shares of any Portfolio.
C. ACCOUNT-BASED FEES
In addition to the fees payable under paragraphs a. and b. above, for each open
or closed account reflected on BISYS' transfer agency system at any time during
each annual period there shall be an account-based fee of $20 per annum.
D. COMPLIANCE SERVICES FEE
In addition to the fees payable under paragraphs a, b, and c, above, the Trust
shall pay an annual fee of $65,000 for the Compliance Services set forth in
Schedule E of this agreement.
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.
SCHEDULE B
TO THE AMENDED AND RESTATED SERVICES AGREEMENT
BETWEEN
ALLIANZ VARIABLE INSURANCE PRODUCTS
FUND OF FUNDS TRUST
AND
BISYS FUND SERVICES OHIO, INC.
ADMINISTRATION SERVICES
1) Provide the Trustees of the Trust or Allianz Life Advisers, LLC (the
"Manager") with reports regarding the Portfolios' investment performance as
they may reasonably request.
2) Provide the Trust and the Manager with BISYS' regular report on 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 Portfolios.
12) Disseminate Portfolio 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 Portfolios, including new
classes, investment objectives, policies, structure, and fund combinations,
reorganizations, or liquidations.
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 Schedule E hereto or in a written agreement 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 Portfolios 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 Portfolios 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 revised policies and procedures.
2) Prepare amendments to Declaration of Trust and file amendments with
applicable states.
3) Prepare amendments to By-Laws.
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 meetings and record minutes.
COMPLIANCE MONITORING AND REPORTING SERVICES - REPORTS
Assist in developing compliance procedures and provide compliance monitoring
services incorporating those procedures for each Portfolio, including the items
covered by the reports listed below as may be relevant to each Portfolio, as are
determinable based upon the Portfolios' 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 Portfolio Brokerage Practices (monthly)
BISYS shall also prepare such other reports as reasonably may be requested by
the Manager.
SCHEDULE C
TO THE AMENDED AND RESTATED SERVICES AGREEMENT
BETWEEN
ALLIANZ 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 Portfolio as required
by Rules 31a-1 and 31a-2 under the 1940 Act.
2) Calculate the net asset value per share ("NAV") of each class of shares
offered by each Portfolio in accordance with the relevant provisions of the
applicable Prospectus of each Portfolio and applicable regulations under
the 0000 Xxx.
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 Portfolio'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 Portfolio'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 Portfolio 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 Portfolios, with the comparison to the amortized basis.
10) Determine unrealized appreciation and depreciation on securities held in
variable net asset value Portfolios.
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 Portfolio's sub-adviser, on variable interest rate instruments.
13) Post Portfolio transactions to appropriate categories.
14) Accrue expenses of each Portfolio according to instructions received from
the Portfolio's Administrator.
15) Determine the outstanding receivables and payables for all (1) security
trades, (2) Portfolio 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 Portfolio'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 SEC
SCHEDULE D
TO THE AMENDED AND RESTATED SERVICES AGREEMENT
BETWEEN
ALLIANZ 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.
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.
SCHEDULE E
TO THE AMENDED AND RESTATED SERVICES AGREEMENT
BETWEEN
ALLIANZ VARIABLE INSURANCE PRODUCTS
FUND OF FUNDS TRUST
AND
BISYS FUND SERVICES OHIO, INC.
1. GENERAL FUND COMPLIANCE SERVICES
(1) Assist the Trust in maintaining the Fund Compliance Program;
(2) Assist the Trust's Chief Compliance Officer (the "Chief Compliance Officer")
in the preparation and evaluation of the results of annual reviews of the
compliance policies and procedures of the service providers to the Trust as
provided in Rule 38a-1 ("Service Providers");
(3) Provide support services to the Chief Compliance Officer, including support
for conducting an annual review of the Fund Compliance Program;
(4) Assist the Chief Compliance Officer in developing standards for reports to
the Board by BISYS and other Service Providers;
(5) Assist the Chief Compliance Officer in developing standards for reports to
the Board by the Chief Compliance Officer;
(6) Assist the Chief Compliance Officer in preparing or providing documentation
for the Board to make findings and conduct reviews pertaining to the Fund
Compliance Program and compliance programs and related policies and procedures
of Service Providers;
(7) Perform risk-based testing and reporting of the compliance policies and
procedures of each service (other than the services set forth in this Schedule
E) provided to the Trust by BISYS and/or provided by any BISYS affiliate acting
as the Trust's distributor, taking into account reasonable requests from the
Chief Compliance Officer to the extent practicable;
(8) Provide copies of any compliance policies and procedures and any amendments
thereto relating to BISYS and any BISYS affiliate acting as the Trust's
distributor as the Trust or the Chief Compliance Officer may reasonably request
in connection with the Fund Compliance Program; and
(9) Provide information reasonably requested by the Chief Compliance Officer, or
the Board in connection with the Board's determination regarding the adequacy
and effectiveness of the compliance policies and procedures of BISYS and any
BISYS affiliate acting as the Trust's distributor.
The Trust will provide or arrange for the provision of the Chief Compliance
Officer. The Trust acknowledges that BISYS will not be responsible for providing
the Chief Compliance Officer, and that if the Trust elects to have BISYS provide
the Chief Compliance Officer in the future, additional terms and conditions and
additional fees will apply. The Trust will provide to BISYS copies of the Fund
Compliance Program, related policies and procedures, and all other books and
records of the Trust as BISYS deems necessary or desirable in order to perform
its obligations under this Agreement.
2. SUB-CERTIFICATIONS.
To assist the Trust in connection with its obligations under the
Xxxxxxxx-Xxxxx Act of 2002, Rule 30a-2 under the 1940 Act, and related laws
(collectively, "Xxxxxxxx-Xxxxx"), BISYS will internally establish and maintain
its own controls and procedures designed to ensure that information recorded,
processed, summarized, or reported by BISYS on behalf of the Trust and included
in the Trust's reports on Form N-CSR and any other reports required to be
certified pursuant to Xxxxxxxx-Xxxxx (collectively, "Reports") is (i) recorded,
processed, summarized, and reported by BISYS within the time periods specified
in the Commission's rules and forms and the Trust's disclosure and control
procedures (the "Trust DCPs"), and (ii) communicated to the relevant officers of
the Trust who are required to certify Reports under Xxxxxxxx-Xxxxx ("Certifying
Officers"), in a manner consistent with the Trust DCPs.
Solely for the purpose of providing a Certifying Officer with a basis
for his or her certification of any Report, BISYS will (i) provide a
sub-certification with respect to BISYS' services during any fiscal period in
which BISYS served as a financial administrator to the Trust consistent with
the requirements of the certification required under Xxxxxxxx-Xxxxx and/or (ii)
inform the Certifying Officers of any reason why all or part of such required
certification would be inaccurate. In rendering any such subcertification,
BISYS may (i) limit its representations to information prepared, processed and
reported by BISYS; (ii) rely upon and assume the accuracy of the information
provided by officers (other than employees or officers of BISYS) and other
authorized agents of the Trust, including all other Service Providers, and
compliance by such officers and agents with the Trust DCPs; and (iii) assume
that the Trust has selected appropriate accounting policies for the Fund(s).
The Trust shall assist and cooperate with BISYS (and shall cause its
officers and other Service Providers to assist and cooperate with BISYS) to
facilitate the delivery of information requested by BISYS in connection with
the preparation of any Report, so that BISYS may submit a draft of such Report
to the Trust's DCP Committee prior to the date it is to be filed.
3. PROVISION OF EXECUTIVE OFFICERS
(a) PROVISION OF CERTIFYING OFFICER(S). Subject to the provisions of
this Section 3(a) and Section 3(b) below, BISYS shall make a BISYS employee
available to the Trust to serve, upon designation as such by the Board, as the
Chief Financial Officer of the Trust or under such other title to perform
similar functions, and which is a Certifying Officer under Xxxxxxxx-Xxxxx.
BISYS' obligation in this regard shall be met by providing an appropriately
qualified employee of BISYS (or its affiliates) who, in the exercise of his or
her duties to the Trust, shall act in good faith and in a manner reasonably
believed by him or her to be in the best interests of the Trust. BISYS shall
select, and may replace, the specific employee that it makes available to serve
in the designated capacity as a Certifying Officer, in BISYS' reasonable
discretion, taking into account such person's responsibilities concerning, and
familiarity with, the Trust's operations.
For so long as BISYS provides a Certifying Officer, the Trust DCPs
shall contain (or the Trust and BISYS shall otherwise establish) mutually
agreeable procedures governing the certification of Reports by Certifying
Officers, and the parties shall comply with such procedures in all material
respects. Among other things, the procedures shall provide as follows:
(i) The Trust shall establish and maintain a Disclosure Controls and
Procedures Committee (the "DCP Committee") to evaluate the Trust DCPs
in accordance with Rule 30a-3 under the 1940 Act. The DCP Committee
shall include (at a minimum) the Trust's Principal Executive Officer,
Chief Financial Officer, and Chief Legal Officer (if any) and such
other individuals as may be necessary or appropriate to enable the DCP
Committee to ensure the cooperation of, and to oversee, each of the
Trust's agents that records, processes, summarizes, or reports
information contained in Reports (or any information from which such
information is derived), including the Trust's other service providers
(the "Other Providers").
(ii) The Trust shall require (a) Service Providers to provide
sub-certifications on internal controls, upon which the Certifying
Officers may rely in certifying Reports, in form and content reasonably
acceptable to the Certifying Officers and consistent with
Xxxxxxxx-Xxxxx, and (b) that such sub-certifications are delivered to
the DCP Committee and the Certifying Officers sufficiently in advance
of the DCP Committee meeting described in (iii) below.
(iii) The DCP Committee shall (a) establish a schedule to ensure that
all required disclosures in any Report, including the financial
statements, are identified and prepared in a timeframe sufficient for
it to review such disclosures, (b) meet prior to the filing date of
each Report to review the accuracy and completeness of the relevant
Report, and (c) record its considerations and conclusions in a written
memorandum sufficient for it to adequately to support conclusions
pertaining to Trust DCPs as required by Item 9 of Form N-CSR or other
Report. In conducting its review and evaluations, the DCP Committee
shall:
(A) review SAS 70 reports pertaining to BISYS and other
Service Providers, if applicable, or in the absence of
any such reports, consider the adequacy of the
sub-certifications supplied by the Service Providers;
(B) consider whether there are any significant
deficiencies or material weaknesses in the design or
operation of the Trust DCPs or internal controls over
financial reporting that could adversely affect the
Trust's ability to record, process, summarize, and
report financial information, and in the event that
any such weaknesses or deficiencies are identified,
disclose them to the Trust's Certifying Officers,
audit committee, and auditors;
(C) consider whether, to the knowledge of any member of
the DCP Committee, there has been or may have been any
fraud, whether or not material, and, if so, disclose
the facts and circumstances thereof to the Certifying
Officers, and the Trust's audit committee and
auditors; and
(D) determine whether there was any change in internal
controls over financial reporting that occurred
during the Trust's most recent fiscal half-year that
has materially affected or is reasonably likely to
materially affect, the Trust's internal control over
financial reporting.
A Certifying Officer shall have the full discretion to decline to
certify a particular Report that fails to meet the standards set forth in the
certification, and to report matters involving fraud or other failures to meet
the standards of applicable law to the audit committee of the Board.
The Trust shall, in its own capacity, take all reasonably necessary and
appropriate measures to comply with its obligations under Xxxxxxxx-Xxxxx.
Without limitation of the foregoing, except for those obligations which are
expressly delegated to or assumed by BISYS in this Agreement, the Trust shall
maintain responsibility for, and shall support and facilitate the role of each
Certifying Officer and the DCP Committee in, designing and maintaining the
Trust's DCPs in accordance with applicable laws.
(b) ADDITIONAL PROVISIONS CONCERNING EXECUTIVE OFFICERS. It is mutually
agreed and acknowledged by the parties that the Chief Financial Officer
contemplated under the provisions of this Section 3 of this Schedule E will be
an executive officer of the Trust, along with any other officers so designated
after the date hereof pursuant to the terms of this Schedule E and the
Agreement (each, an "Executive Officer") The provisions of Section 3 are
subject to the internal policies of BISYS concerning the activities of its
employees and their service as officers of funds (the "BISYS Policies"), a copy
of which shall be provided to the Trust upon request.
The Trust shall provide coverage to each Executive Officer under its
directors and officers liability policy that is appropriate to the Executive
Officer's role and title, and consistent with coverage applicable to the other
officers holding positions of executive management.
In appropriate circumstances, each Executive Officer shall have the
discretion to resign from his or her position, in the event that he or she
reasonably determines that there has been or is likely to be (a) a material
deviation from the BISYS Policies, (b) an ongoing pattern of conduct involving
the continuous or repeated violation of Applicable AML Laws or Applicable
Securities Laws, or (c) a material deviation by the Trust from the terms of
this Agreement governing the services of such Executive Officer that is not
caused by such Executive Officer or BISYS. In addition, each Executive Officer
shall have reasonable discretion to resign from his or her position in the
event that he or she determines that he or she has not received sufficient
cooperation from the Trust or its Other Providers to make an informed
determination regarding any of the matters listed above, and shall at all times
have the right to resign his or her position for any or no reason, as permitted
under applicable federal and/or state law.
Each Executive Officer may, and the Trust shall, promptly notify BISYS
of any issue, matter or event that would be reasonably likely to result in any
claim by the Trust, one or more Trust shareholder(s) or any third party which
involves an allegation that any Executive Officer failed to exercise his or her
obligations to the Trust in a manner consistent with applicable laws (including
but not limited to any claim that a Report failed to meet the standards of
Xxxxxxxx-Xxxxx and other applicable laws).
Notwithstanding any provision of the Agreement that expressly or by
implication provides to the contrary, (a) it is expressly agreed and
acknowledged that BISYS cannot ensure that the Trust complies with Applicable
AML Laws or the Applicable Securities Laws, and (b) whenever an employee or
agent of BISYS serves as an Executive Officer of the Trust, the Trust shall
indemnify the Executive Officer and BISYS and hold the Executive Officer and
BISYS harmless from any loss, liability, expenses (including reasonable
attorneys fees) and damages incurred by them arising out of or related to the
service of such employee or agent of BISYS as an Executive Officer of the Trust,
provided that such Executive Officer has not acted with "Disabling Conduct" as
defined in the Trust's Agreement and Declaration of Trust, dated July 13, 1999.
SCHEDULE F
TO THE AMENDED AND RESTATED SERVICES AGREEMENT
BETWEEN
ALLIANZ 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.
PERFORMANCE STANDARDS
----------------------------------------------------- ------------------------------------------------------
FUNCTION/TASK STANDARD PERFORMANCE
MEASURE
----------------------------------------------------- ------------------------------------------------------
FUND ADMINISTRATION
- MONTHLY COMPLIANCE REPORTS Completed review and results sent no later than 10
+ SEC COMPLIANCE CHECK business days after BISYS' receipt of source reports
+ ADVISER COMPLIANCE REPORTS
+ IRS COMPLIANCE CHECK
FUND ACCOUNTING
- NAV'S ACCURATELY COMPLETED AND 99% accurately completed and reviewed before
- REVIEWED publication
- NAV'S INTERFACED WITH T/A
TRANSFER AGENT
- PERCENTAGE OF ACCURATELY PROCESSED MANUAL
FINANCIAL TRANSACTIONS 98% entered on the transfer agency system accurately
before pending entries become final
----------------------------------------------------- ------------------------------------------------------
