Exhibit 23 (h-9)
COMPLIANCE SERVICES AGREEMENT
AGREEMENT effective as of the 1st day of July, 2006, between PACIFIC
CAPITAL FUNDS (the "Trust"), a Massachusetts business trust having its principal
place of business at 0000 Xxxxxxx Xxxx, Xxxxxxxx, Xxxx 00000 and BISYS FUND
SERVICES OHIO, INC. ("BISYS"), an Ohio corporation having its principal place of
business at 0000 Xxxxxxx Xxxx, Xxxxxxxx, Xxxx 00000.
WHEREAS, the Trust is a registered investment company, and is subject to
the requirements of Rule 38a-1 under the Investment Company Act of 1940, as
amended (the "1940 Act"), which requires each registered investment company to
adopt policies and procedures that are reasonably designed to prevent it from
violating the federal securities laws;
WHEREAS, BISYS performs certain management and administration services for
the Trust under a sub-administration agreement among BISYS, the Trust and the
Bank of Hawaii (the "Sub-Administration Agreement");
WHEREAS, BISYS offers compliance services through its Compliance EDGE
program, which may be tailored to create a compliance program for the Trust;
WHEREAS, the Trust desires that BISYS provide its Compliance EDGE program
services in connection with the institution of a comprehensive compliance
program for the Trust;
WHEREAS, BISYS is willing to perform the services enumerated in this
Agreement on the terms and conditions set forth in this Agreement; and
WHEREAS, BISYS and the Trust wish to enter into this Agreement in order to
set forth the terms under which BISYS will perform the services enumerated
herein on behalf of the Trust, and to supplement and clarify certain provisions
of the Sub-Administration Agreement.
NOW, THEREFORE, in consideration of the covenants herein contained, the
Trust and BISYS hereby agree as follows:
1. Compliance Services.
(a) The parties have coordinated and cooperated in connection with the
creation and implementation of written compliance polices and procedures which,
in the aggregate, were in a form that the Board of Trustees of the Trust (the
"Board") deemed 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 0000 Xxx.
(b) The Trust agrees to provide BISYS with copies of its current compliance
policies and procedures which have been approved by the Board and which are
effective
(as amended from time to time upon the approval of the Board, the "Fund
Compliance Program").
(c) BISYS will provide the following services in relation to the Fund
Compliance Program during the term of this Agreement: (i) make an individual
reasonably acceptable to the Board available to serve as the Trust's Chief
Compliance Officer to administer the Fund Compliance Program, to the extent
provided in Section 2(a) below; (ii) assist the Trust in maintaining the written
policies and procedures comprising the Fund Compliance Program, as contemplated
above and as may be necessary in connection with amendments from time to time;
(iii) assist the Trust in the preparation and evaluation of the results of
annual reviews of the compliance policies and procedures of the service
providers to the Trust (the "Service Providers"); (iv) provide support services
to the Chief Compliance Officer of the Trust, including support for conducting
an annual review of the Fund Compliance Program; (v) assist in developing
standards for reports to the Board by BISYS and other Service Providers; (vi)
assist in developing standards for reports to the Board by the Chief Compliance
Officer; and (vi) assist 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
and the Chief Compliance Officer.
2. Provision of Executive Officers
(a) Provision of Chief Compliance Officer. At the election of the Trust, in
connection with the compliance services to be rendered by BISYS pursuant to
Section 1 above, and subject to the provisions of this Section 2(a) and to
Section 2(d) below, BISYS agrees to make available to the Trust a person to
serve as the Trust's chief compliance officer responsible for administering the
Fund Compliance Program as provided in paragraph (a)(4) of Rule 38a-1 (the
"Chief Compliance Officer"). BISYS' obligation in this regard shall be met by
providing an appropriately qualified employee or agent of BISYS (or its
affiliates) reasonably acceptable to the Board 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.
The Trust acknowledges and agrees that the Chief Compliance Officer has an
employment or independent contractor agency relationship with BISYS, to which
the Trust is not a party, and that the Trust has no right to require BISYS to
continue or terminate such relationship. In the event that BISYS decides to
terminate the employment of the person serving as the Chief Compliance Officer
of the Trust, BISYS shall use reasonable efforts to notify the Trust in advance
of such termination, and provide as much notice to the Trust of the termination
as may be practical under the circumstances. BISYS acknowledges and agrees that
the Trustees of the Trust who are not "interested persons" of the Trust as
defined in the 1940 Act may terminate the services of the person serving as the
Chief Compliance Officer at any time and for any reason in their sole
discretion. In such event, upon the request of the Trust, BISYS will employ
reasonable good faith efforts to make another person reasonably acceptable to
the Board available to serve as Chief Compliance Officer.
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In the event that the employment relationship or independent contractor
agency relationship between BISYS and any person made available by BISYS to
serve as Chief Compliance Officer terminates for any reason, BISYS shall have no
further responsibility to provide the services of that particular person, and
shall have no responsibility whatsoever for the services to the Trust or other
activities of such person provided or occurring after such termination
regardless of whether or not the Board terminates such person as Chief
Compliance Officer. In such event, upon the request of the Trust, BISYS will
employ reasonable good faith efforts to make another person available to serve
as the Chief Compliance Officer.
In connection with BISYS' commitment to make an appropriately qualified
person available to serve as Chief Compliance Officer, BISYS shall pay a level
of total compensation to such person as is consistent with BISYS' compensation
of employees having similar duties, similar seniority, and working at the same
or similar geographical location. BISYS shall not be obligated to pay any
compensation to a Chief Compliance Officer which exceeds that set forth in the
previous sentence. BISYS shall provide the Board with such information as it
shall reasonably request to fulfill its obligation to review the compensation of
the Chief Compliance Officer.
The Trust will provide copies of the Fund Compliance Program, related
policies and procedures, and all other books and records of the Trust as the
Chief Compliance Officer deems necessary or desirable in order to carry out his
or her duties hereunder on behalf of the Trust. The Trust shall cooperate with
the Chief Compliance Officer and ensure the cooperation of the investment
adviser, the custodian and any other Service Providers to the Trust, as well as
Trust counsel, independent Trustee counsel and the Trust's independent
accountants (collectively, the "Other Providers"), and assist the Chief
Compliance Officer and BISYS in preparing, implementing and carrying out the
duties of the Chief Compliance Officer under the Fund Compliance Program and
Rule 38a-1. In addition, the Trust shall provide the Chief Compliance Officer
with appropriate access to the executive officers and trustees of the Trust, and
to representatives of and to any records, files and other documentation prepared
by, Service Providers and Other Providers, which are or may be related to the
Fund Compliance Program.
Each party agrees to provide promptly to the other party (and to the Chief
Compliance Officer), upon request, copies of other records and documentation
relating to the compliance by such party with Applicable Securities Laws (as
related to the Fund Compliance Program of the Trust), and each party also agrees
otherwise to assist the other party (and the Chief Compliance Officer) in
complying with the requirements of the Fund Compliance Program and Applicable
Securities Laws.
(b) Provision of Certifying Officer(s). Subject to the provisions of this
Section 2(b) and Schedule C of the Sub-administration Agreement, 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 as determined by the Board to perform similar functions, and which is a
Certifying Officer under the Xxxxxxxx-Xxxxx Act of 2002, Rule 30a-2 under the
1940 Act, and related laws and other applicable laws (collectively,
"Xxxxxxxx-Xxxxx"). BISYS' obligation in this regard shall be met by
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providing an appropriately qualified employee of BISYS (or its affiliates)
reasonably acceptable to the Board 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, with a person reasonably acceptable to the Board, 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.
(c) AML Compliance Officer. It is understood that the Trust is a financial
institution subject to the law entitled Uniting and Strengthening America by
Providing Appropriate Tools Required to Intercept and Obstruct Terrorism
("U.S.A. Patriot") Act of 2001 and the Bank Secrecy Act (collectively, the "AML
Acts"), and is required to comply with the AML Acts and applicable regulations
thereunder (collectively, the "Applicable AML Laws").
Subject to the provisions of this Section 2(c) and Section 2(d) below,
BISYS agrees to make available to the Trust a person to serve as the Trust's
anti-money laundering compliance officer ("AML Compliance Officer") upon
designation as such by the Board. BISYS' obligation in this regard shall be met
by providing an appropriately qualified employee or agent 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. All necessary training obligations of the AML Compliance
Officer shall be undertaken at BISYS' expense. Subject to the relevant terms of
the transfer agency or other services agreement under which BISYS provides
certain anti-money laundering services to the Trust, the AML Compliance Officer
will assist the Trust in operating the written anti-money laundering program
adopted by the Board of the Trust and provided to BISYS (the "AML Program"), and
shall perform the duties assigned to the AML Compliance Officer which are set
forth in the AML Program.
The Trust shall provide copies of its anti-money laundering compliance
reports and such other books and records of the Trust as the AML Compliance
Officer deems necessary or desirable in order to carry out his or her duties
hereunder on behalf of the Trust. Each party also agrees to provide promptly to
the other party (and to the AML Compliance Officer), upon request, copies of
other records and documentation relating to the compliance by such party with
Applicable AML Laws (in relation to the Trust), and each party also agrees
otherwise to assist the other party (and the AML Compliance Officer) in
complying with the requirements of the AML Program and Applicable AML Laws. Each
party agrees to retain a copy of all documents and records prepared, maintained
or obtained by it relating to shareholders and transactions for a period of at
least five (5) years from the termination of the relationship with each such
shareholder or the date of execution of each such transaction. The foregoing is
not intended to limit any obligation to retain any specified records for any
other period that may be specified in the AML Program or under Applicable AML
Laws. BISYS acknowledges and agrees that the Trustees of the Trust who are not
"interested persons" of the Trust as defined in the 1940 Act may terminate the
services of the person serving as the AML Compliance Officer at any time and for
any reason in their sole discretion. In such event, upon the request of the
Trust, BISYS will employ reasonable good faith efforts to make another
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person reasonably acceptable to the Board available to serve as the AML
Compliance Officer.
(d) Additional Provisions Concerning Executive Officers. It is mutually
agreed and acknowledged by the parties that the Chief Compliance Officer
contemplated under the provisions of this Section 2 of this Agreement will be an
executive officer of the Trust ("Executive Officer"). In addition, the parties
agree that the AML Compliance Officer shall be treated as an Executive Officer
of the Trust for purposes of this Section 2(d). The provisions of Sections 2(a)
- (c) 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. BISYS shall promptly provide to
the Trust copies of any material amendments to the BISYS Policies. The Trust's
governing documents (including its Agreement and Declaration of Trust and
By-Laws) and/or resolutions of its Board shall contain mandatory indemnification
provisions that are applicable to each Executive Officer, that are designed and
intended to have the effect of fully indemnifying him or her and holding him or
her harmless with respect to any claims, liabilities and costs arising out of or
relating to his or her service in good faith in a manner reasonably believed to
be in the best interests of the Trust, except to the extent he or she would
otherwise be liable to the Trust by reason of willful misfeasance, bad faith,
gross negligence or reckless disregard of the duties involved in the conduct of
his or her office.
The Trust shall provide coverage to each Executive Officer under its
directors and officers liability policy that is consistent with coverage
available in the mutual funds industry and applicable to the other officers of
the Trust 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. In the event an Executive Officer resigns as such for
any reasons (other than for the reasons specified in the foregoing provisions of
this Section 2(d), BISYS shall promptly provide another appropriately qualified
employee or agent reasonably acceptable to the Board to serve as such Executive
Officer.
By accepting appointment as an Executive Officer, such person and BISYS
each acknowledges and agrees that his or her appointment does not constitute an
express or implied agreement between the Executive Officer and the Trust for any
specific period of appointment, and involves no employment relationship with the
Trust. BISYS and each such person further acknowledges and agrees that the Board
shall have the right to
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terminate his or her appointment as an Executive Officer, with or without
notice, at any time.
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.
Notwithstanding any provision of the Sub-Administration Agreement or any
other agreement or instrument 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, as long as such Executive Officer acts in good faith and
in a manner reasonably believed to be in the best interests of the Trust (and
would not otherwise be liable to the Trust by reason of willful misfeasance, bad
faith, gross negligence or reckless disregard of the duties involved in the
conduct of his or her office), 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 to the same extent as other Executive
Officers of the Trust.
3. Fees and Expenses
(a) BISYS shall be entitled to receive from the Trust the amounts set forth
on Schedule A hereto, reflecting the amounts charged by BISYS for the
performance of services under this Agreement. The fees hereunder shall be in
addition to all fees and expenses charged by BISYS under the Sub-Administration
Agreement.
(b) In addition to paying BISYS the fees set forth in Schedule A, the Trust
agrees to reimburse BISYS for all of its actual out-of-pocket expenses
reasonably incurred in providing services under this Agreement, including but
not limited to the following:
(i) All out of pocket costs incurred in connection with BISYS'
provision of Executive Officers to the Trust in connection with
compliance services, including travel costs for attending Board
meetings and conducting due diligence of Service Providers, which when
practical shall be allocated on a pro rated basis to the respective
fund complexes which the Chief Compliance Officer serves;
(ii) If applicable initially or from time to time hereafter, upon the
prior approval of the Trust, costs to recruit a Chief Compliance
Officer; and
(iii) The direct out-of-pocket costs incurred by BISYS in connection
with the Fund Compliance Program, including those incurred by or with
respect
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to Other Providers, in providing reports to the Chief Compliance
Officer under the Fund Compliance Program.
(c) All rights of compensation under this Agreement for services performed
and for expense reimbursement shall survive the termination of this Agreement.
4. Information to be Furnished by the Trust
(a) The Trust has furnished or shall promptly furnish to BISYS copies of
the following, as amended and current as of the date of this Agreement:
(i) 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; and
(ii) The Trust's disclosure and control procedures (the "Trust DCPs").
(b) The Trust shall furnish BISYS written copies of any amendments to, or
changes in, any of the items referred to in Section 4(a) hereof, forthwith upon
such amendments or changes becoming effective. In addition, the Trust agrees
that no amendments will be made to the AML Program, or the Fund Compliance
Program, or the Trust DCPs which might have the effect of changing the
procedures employed by BISYS in providing the services agreed to hereunder or
which amendment might affect the duties of BISYS hereunder unless the Trust
first obtains BISYS's approval of such amendments or changes, which approval
shall not be withheld unreasonably.
(c) BISYS may rely on all documents furnished to it by the Trust and its
agents (other than the BISYS Executive Officers) in connection with the services
to be provided under this Agreement, including any amendments to or changes in
any of the items to be provided by the Trust pursuant to Section 4(a) unless it
is clearly unreasonable to do so.
The Trust represents and warrants that (i) the provision of certain
officers of the Trust by BISYS, as provided in Section 2 of this Agreement, has
been approved by the Board, and (ii) each of the individuals nominated by BISYS
as the Trust's AML Compliance Officer, Chief Compliance Officer, or Financial
Officer has been approved and appointed as an officer of the Trust by the Board.
5. Term and Termination
(a) The compliance services to be rendered by BISYS under this Agreement
(the "Compliance Services") shall commence upon the date of this Agreement and
shall continue in effect for one (1) year, until June 30, 2007, unless earlier
terminated pursuant to the terms of this Agreement. During such one year term,
the compliance Services may
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be terminated upon thirty (30) days notice in the event there is "cause", as
defined in the Sub-administration Agreement (except that references to
"Agreement" shall mean this Agreement). Following the one year anniversary of
the date of this Agreement, the Compliance Services may be terminated by either
party for "cause," as provided above, or by providing the other party with
ninety (90) days written notice of termination.
(b) The obligations of BISYS set forth in Section 2(b) above shall
terminate automatically upon any termination of the transfer agency agreement
under which BISYS provides transfer agency services to the Trust.
(c) Notwithstanding anything in this Agreement to the contrary, including
but not limited to the provisions of Section 5(a), all of the obligations of
BISYS hereunder shall terminate automatically upon any termination of the
Sub-Administration Agreement.
6. Notice
Any notice provided hereunder shall be sufficiently given when sent by
registered or certified mail to the party required to be served with such notice
at the following address: if to the Trust, Attn: President, Pacific Capital
Funds, 000 Xxxxxxxx Xxxxxx, Xxxxx 000, Xxxxxxxx, XX; and if to BISYS, at 0000
Xxxxxxx Xxxx, Xxxxxxxx, Xxxx 00000; Attn: President, or at such other address as
such party may from time to time specify in writing to the other party pursuant
to this Section.
7. Governing Law and Matters Relating to the Trust as a Massachusetts
Business Trust
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. It is
expressly agreed that the obligations of the Trust hereunder shall not be
binding upon any of the Trustees, shareholders, nominees, officers, agents or
employees of the Trust personally, but shall bind only the trust property of the
Trust. The execution and delivery of this Agreement have been authorized by the
Trustees, and this Agreement has been signed and delivered by an authorized
officer of the Trust, acting as such, and neither such authorization by the
Trustees nor such execution and delivery by such officer shall be deemed to have
been made by any of them individually or to impose any liability on them
personally, but shall bind only the trust property of the Trust as provided in
the Trust's Declaration of Trust.
8. Representations and Warranties
Each party represents and warrants to the other that this Agreement has
been duly authorized and, when executed and delivered by it, will constitute its
legal, valid and binding obligation, enforceable against it 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.
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9. Miscellaneous
(a) Except as expressly provided in this Agreement, the terms of Sections
2, 3(c), 4, 5, 7-17 and Schedule C of the Sub-Administration Agreement (except
those relating to the Bank of Hawaii) shall apply to the services rendered under
this Agreement. Except as provided in this Agreement, the provisions of the
Sub-Administration Agreement remain in full force and effect (including, without
limitation, the term of the Sub-Administration Agreement).
(b) The provisions set forth in this Agreement supersede all prior
negotiations, understandings and agreements bearing upon the subject matter
covered herein.
(c) No amendment or modification to this Agreement shall be valid unless
made in writing and executed by both parties hereto.
(d) Paragraph headings in this Agreement are included for convenience only
and are not to be used to construe or interpret this Agreement.
(e) 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.
* * * * *
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed all as of the day and year first above written.
PACIFIC CAPITAL FUNDS
By: /s/ Xxxxxx Xxxxxxx
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Name: Xxxxxx Xxxxxxx
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Title: President
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BISYS FUND SERVICES OHIO, INC.
By: /s/ Xxxx Xxxxxxx
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Name: Xxxx Xxxxxxx
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Title: President
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SCHEDULE A
TO COMPLIANCE SERVICES AGREEMENT
DATED JULY 1, 2006
COMPLIANCE SERVICES FEES
Compliance Services provided under this Agreement:
$150,000 annual fee per year
All annual fees set forth above shall be payable in equally monthly
installments.
All recurring fees set forth above shall be subject to adjustment annually
commencing on the one-year anniversary of the date of this Agreement by the
percentage increase in consumer prices for services as measured by the United
States Consumer Price Index entitled "All Services Less Rent of Shelter" or a
similar index should such index no longer be published.
OUT OF POCKET EXPENSES
Out of pocket expenses are not included in the above fees and shall also be paid
to BISYS in accordance with the provisions of this Agreement.
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