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EXHIBIT (h)(3)
ADMINISTRATION AGREEMENT
THIS AGREEMENT is made as of this 1st day of August, 1999, by and
between ASSET MANAGEMENT FUND, INC. (the "Company"), a Maryland corporation
having its principal place of business at 000 Xxxx Xxxxxx Xxxxxx, Xxxxxxx,
Xxxxxxxx 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 Company is an open-end management investment company
registered under the Investment Company Act of 1940, as amended (the "1940
Act"); and
WHEREAS, the Company desires BISYS to perform certain services, and
BISYS is willing to provide such services, for each current investment portfolio
of the Company and any additional investment portfolios that may hereafter be
created (individually, the "Portfolio," and collectively as the "Portfolios"),
on the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the covenants
hereinafter contained, the Company and BISYS hereby agree as follows:
ARTICLE 1. Retention of BISYS. The Company hereby retains BISYS to act
as Administrator of the Portfolios and to furnish the Portfolios with the
management and administrative services as set forth in Article 2 below. BISYS
hereby accepts such employment to perform the duties set forth below.
BISYS shall, for all purposes herein, be deemed to be an independent
contractor and, unless otherwise expressly provided or authorized, shall have no
authority to act for or represent the Company in any way and shall not be deemed
an agent of the Company.
ARTICLE 2. Administrative Services. BISYS shall perform or supervise
the performance by others of other administrative services in connection with
the operations of the Portfolios, and, on behalf of the Company, 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 Portfolios' operations. BISYS shall provide
the Board of Directors of the Company (hereafter referred to as the "Directors")
with such reports regarding investment performance as they may reasonably
request but shall have no responsibility for supervising the performance by any
investment adviser or sub-adviser of its responsibilities.
BISYS agrees to perform the services described herein in accordance
with all applicable laws, rules and regulations (including, where applicable,
Generally Accepted Accounting Principles) and in accordance with any reasonable
instructions of the Company and the Company's Articles of Incorporation, Bylaws,
Prospectus and Statement of Additional Information.
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BISYS shall provide the Company with regulatory reporting, all
necessary office space, equipment, personnel, compensation and facilities
(including facilities for Shareholders' and Directors' meetings) for handling
the affairs of the Company and such other services as BISYS shall, from time to
time, determine to be necessary to perform its obligations under this Agreement.
In addition, at the request of the Directors, BISYS shall make reports to the
Company's Directors concerning the performance of its obligations hereunder.
Without limiting the generality of the foregoing, BISYS shall:
(a) calculate contractual Company expenses and control all
disbursements for the Company, and as appropriate compute the Company's yields,
total return, expense ratios, portfolio turnover rate and, if required,
portfolio average dollar-weighted maturity;
(b) assist Company counsel with the preparation of prospectuses,
statements of additional information, registration statements and proxy
materials;
(c) prepare such reports, applications and documents (including
reports regarding the sale and redemption of shares of common stock of the
Company ("Shares") as may be required in order to comply with Federal and state
securities law) as may be necessary or desirable to register the Company's
Shares with state securities authorities, monitor the sale of Company Shares for
compliance with state securities laws, and prepare and file with the appropriate
state securities authorities the registration statements and reports for the
Company and the Company's Shares and all amendments thereto, as may be necessary
or convenient to register and keep effective the Company and the Company's
Shares with state securities authorities to enable the Company to make a
continuous offering of its Shares;
(d) develop and prepare, with the assistance of the Company's
investment adviser, communications to Shareholders, including the annual report
to Shareholders, coordinate the mailing of prospectuses, notices, proxy
statements, proxies and other reports to Company Shareholders, and supervise and
facilitate the proxy solicitation process for all shareholder meetings,
including the tabulation of shareholder votes;
(e) administer contracts on behalf of the Company with, among
others, the Company's investment adviser, distributor, custodian, transfer agent
and fund accountant;
(f) supervise the Company's transfer agent with respect to the
payment of dividends and other distributions to Shareholders;
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(g) calculate performance data of the Portfolios for
dissemination to information services covering the investment company industry;
(h) coordinate, provide the necessary financial/tax data for and
supervise, the preparation of the Company's tax returns;
(i) examine and review the operations and performance of the
various organizations providing services to the Company, including, without
limitation, the Company's investment adviser, distributor, custodian, fund
accountant, transfer agent, outside legal counsel and independent public
accountants, including monitoring of all applicable contractual fee or expense
limitations, and at the request of the Directors, report to the Board on the
performance of organizations;
(j) assist with the layout and printing of publicly disseminated
prospectuses and assist with and coordinate layout and printing of the Company's
semi-annual and annual reports to Shareholders;
(k) assist with the design, development, and operation of the
Portfolios, including new classes, investment objectives, policies and
structure;
(l) provide individuals reasonably acceptable to the Company's
Directors to serve as officers of the Company (without compensation,
reimbursement of expenses or indemnification from the Company, other than as set
forth in this Agreement), who will be responsible for the management of certain
of the Company's affairs as determined by the Company's Directors;
(m) advise the Company and its Directors on matters concerning
the Company and its affairs;
(n) obtain and keep in effect fidelity bonds and directors and
officers/errors and omissions insurance policies for the Company in accordance
with the requirements of Rules 17g-1 and 17d-1(7) under the 1940 Act as such
bonds and policies are approved by the Company's Directors and make all
necessary filings with the SEC;
(o) monitor and advise the Company and its Portfolios on their
registered investment company status under the Internal Revenue Code of 1986, as
amended;
(p) perform all administrative services and functions of the
Company to the extent administrative services and functions are not provided to
the Company pursuant to the Company's investment advisory agreement,
distribution agreement, custodian agreement, transfer agent agreement and fund
accounting agreement;
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(q) furnish advice and recommendations with respect to other
aspects of the business and affairs of the Portfolios as the Company and BISYS
shall determine desirable; and
(r) prepare and file with the SEC in a timely manner (in order
to avoid interest charges) the semi-annual report for the Company on Form N-SAR
and all required notices pursuant to Rule 24f-2.
Without limiting the foregoing, the services to be provided by BISYS
hereunder shall include the services listed in the detailed service listing
attached hereto as Schedule B. BISYS shall perform such other services for the
Company that the Company may from time to time reasonably request; provided,
however, that, to the extent that the performance of any of such other services
requires BISYS to incur material additional costs, and BISYS notifies the
Company thereof promptly after such request, such services shall be provided in
exchange for such additional compensation that is agreed upon by the parties.
Such services may include performing internal audit examinations; mailing the
annual reports of the Portfolios; preparing an annual list of Shareholders; and
mailing notices of Shareholders' meetings, proxies and proxy statements, for all
of which the Company will pay BISYS's out-of-pocket expenses.
BISYS shall enter into and shall maintain in effect with appropriate
parties one or more agreements making reasonable provisions for emergency use of
electronic data processing equipment and shall, at no additional expense to the
Company, take reasonable steps to minimize service interruptions.
BISYS shall provide on a timely basis to the Company's investment
adviser, transfer agent, accounting agent, distributor and custodian and other
persons providing services to the Company such information as such persons may
reasonably request in connection with the performance of their respective duties
and obligations with respect to the Company. BISYS will report to the Board of
Directors of the Company at each meeting of the Board of Directors and will keep
the Board of Directors informed of material developments affecting the Company.
BISYS will comply with any performance standards that may be agreed to
by BISYS and the Company from time to time.
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
officers of the Company as well as all Directors of the Company who are
affiliated persons of BISYS or any affiliated corporation of BISYS; provided,
however, that unless otherwise specifically provided, BISYS shall not be
obligated to pay the compensation of any employee of the Company retained by the
Directors of the Company to perform services on behalf of the Company.
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(B) The Company. The Company assumes and shall pay or cause to
be paid all other expenses of the Company 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, the costs of custodial
services, the cost of initial and ongoing registration of the Shares under
Federal and state securities laws, fees and out-of-pocket expenses of Directors
who are not affiliated persons of BISYS or the Investment Adviser to the Company
or any affiliated corporation of BISYS or the Investment Adviser, insurance,
interest, brokerage costs, litigation and other extraordinary or nonrecurring
expenses, and all fees and charges of investment advisers to the Company.
ARTICLE 4. Compensation of BISYS.
(A) Administration Fee. For the services to be rendered, the
facilities furnished and the expenses assumed by BISYS pursuant to this
Agreement, the Company shall pay to BISYS compensation at an annual rate
specified in the Omnibus Fee Agreement between the Company and BISYS dated as of
August 1, 1999 (the "Fee Agreement"). Such compensation shall be calculated and
accrued daily, and paid to BISYS monthly. The Company shall also reimburse BISYS
for its reasonable out-of-pocket expenses, including the travel and lodging
expenses incurred by officers and employees of BISYS in connection with
attendance at Board meetings.
If this Agreement becomes effective subsequent to the first day of
a month or terminates before the last day of a month, BISYS's 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's compensation for the preceding month shall be made promptly.
(B) Survival of Compensation Rights. All rights of compensation
under this Agreement for services performed as of the termination date shall
survive the termination of this Agreement.
ARTICLE 5. Standard of Care; Reliance on Records and Instructions;
Indemnification. BISYS shall use its best efforts to ensure the accuracy of all
services performed under this Agreement, but shall not be liable to the Company
for any action taken or omitted by BISYS in the absence of bad faith, willful
misfeasance, negligence or from reckless disregard by it of its obligations and
duties. The Company 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, whether groundless or otherwise, and from and
against any and all judgments, liabilities, losses, damages, costs, charges,
reasonable counsel fees and other expenses of every nature and character arising
out of or in any way relating to BISYS' actions taken or nonactions 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 Company or an investment adviser of the Company and on
any records
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provided by any fund accountant or custodian thereof; provided, however, that
BISYS shall not be protected in relying on any information, records,
instructions or requests given, made or prepared by BISYS or any affiliate of
BISYS or any officer of the Company that is an officer or employee of BISYS or
any affiliate of BISYS; and provided, further, that this indemnification shall
not apply to actions or omissions of BISYS in cases of its own bad faith,
willful misfeasance, negligence or from reckless disregard by it of its
obligations and duties; and further provided that prior to confessing any claim
against it which may be the subject of this indemnification, BISYS shall give
the Company written notice of and a reasonable opportunity to defend against
said claim in its own name or in the name of BISYS.
Notwithstanding the foregoing, BISYS agrees to indemnify and hold
harmless the Company, its employees, agents, directors, officers and nominees
from and against any and all actions, suits, demands and claims, whether
groundless or otherwise, and from and against any and all judgments,
liabilities, losses, damages, costs, charges, reasonable counsel fees and other
expenses of every nature and character arising out of or in any way relating to
BISYS's bad faith, willful malfeasance or misfeasance, negligence, or reckless
disregard by it of its obligations and duties, with respect to the performance
of services under this Agreement.
The indemnifying party shall be entitled to participate at its own
expense or, if it acknowledges its responsibility to indemnify the other party,
it may elect 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 the indemnifying party and 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 a suit, it will reimburse the indemnified party for the reasonable fees and
expenses of any counsel retained by the indemnified party.
ARTICLE 6. Activities of BISYS. The services of BISYS rendered to the
Company 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 directors, officers, employees and Shareholders of the Company 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 Company, and that BISYS may be or become
interested in the Company as a Shareholder or otherwise.
ARTICLE 7. Duration of this Agreement. The Term of this Agreement shall
be as specified in Schedule A hereto. In the event either party gives notice of
the termination of this Agreement as provided in Schedule A, BISYS will
cooperate and use all reasonable efforts to assist with the conversion of the
data and records maintained by it hereunder to, and the assumption of the
services provided by it hereunder by, a replacement provider of administrative
services.
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ARTICLE 8. Assignment. This Agreement shall not be assignable by either
party, nor may BISYS subcontract or delegate any of its duties hereunder,
without the written consent of the other party; provided, however, that BISYS
may, at its expense, with the prior written consent of the Company, subcontract
with any entity or person concerning the provision of the services contemplated
hereunder. BISYS shall not, however, 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 5 hereof, for
all acts of such subcontractor as if such acts were its own. This Agreement
shall be binding upon, and shall ensure to the benefit of, the parties hereto
and their respective successors and permitted assigns. BISYS will give the
Company prompt written notice of the appointment of any such subcontractor. Any
assignment not in compliance with this Agreement shall be void.
ARTICLE 9. Amendments. This Agreement may be amended by the parties
hereto only if such amendment is specifically approved (i) by the vote of a
majority of the Directors of the Company, and (ii) by the vote of a majority of
the Directors of the Company who are not parties to this Agreement or interested
persons of any such party, cast in person at a Directors meeting called for the
purpose of voting on such approval.
For special cases, the parties hereto may amend such procedures set
forth herein as may be appropriate or practical under the circumstances, and
BISYS may conclusively assume that any special procedure which has been approved
by the Company does not conflict with or violate any requirements of its
Certificate of Incorporation or then current prospectuses, or any rule,
regulation or requirement of any regulatory body.
ARTICLE 10. Certain Records. BISYS shall maintain customary records in
connection with its duties as specified in this Agreement, and, without limiting
the foregoing, BISYS shall maintain such books and records as the Company may be
required to maintain under the 1940 Act and the rules and regulations thereunder
that are not required to be maintained by the Company's investment adviser,
distributor, transfer agent, fund accountant or custodian, including, without
limitation, books and records relating to the operations of the Company prior to
the date of this Agreement, to the extent provided to BISYS. All such records,
including any records required to be maintained and preserved pursuant to Rules
31a-1 and 31a-2 under the 1940 Act, which are prepared or maintained by BISYS on
behalf of the Company shall be prepared and maintained at the expense of BISYS,
but shall be the property of the Company and will be made available to or
surrendered promptly to the Company on request.
In case of any request or demand for the inspection of such records by
another party, BISYS shall notify the Company and follow the Company's
instructions as to permitting or refusing such inspection; provided that BISYS
may exhibit such records to any person in any case where it is advised by its
counsel that it may be held liable for failure to do so, unless (in cases
involving potential exposure only to civil liability) the Company has agreed to
indemnify BISYS against such liability. BISYS will promptly notify the Company
of any such request.
ARTICLE 11. Definitions of Certain Terms. The terms "interested person"
and "affiliated person," when used in this Agreement, shall have the respective
meanings specified in
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the 1940 Act and the rules and regulations thereunder, subject to such
exemptions as may be granted by the Securities and Exchange Commission.
ARTICLE 12. Notice. Any notice required or permitted to be given by
either party to the other shall be deemed sufficient if sent by registered or
certified mail, postage prepaid, addressed by the party giving notice to the
other party at the following address: if to the Company at 000 Xxxx Xxxxxx
Xxxxxx, Xxxxxxx, Xxxxxxxx 00000; if to BISYS at 0000 Xxxxxxx Xxxx, Xxxxxxxx,
Xxxx 00000; or at such other address as such party may from time to time specify
in writing to the other party pursuant to this Section.
ARTICLE 13. 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 or the rules and regulations thereunder. 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, or such rules and regulations,
the latter shall control.
ARTICLE 14. Multiple Originals. This Agreement may be executed in two
or more counterparts, each of which when so executed shall be deemed to be an
original, but such counterparts shall together constitute but one and the same
instrument.
ARTICLE 15. Instructions, Approval or Consent by the Company;
Imputation. Any reference herein to any instructions, approval or consent of the
Company shall not include any instructions, approval or consent given by any
officer of the Company that is an officer, employee or agent of BISYS or any
affiliate of BISYS, unless specifically authorized by the Board of Directors of
the Company. No information known to any such officer of the Company shall be
imputed to the Company for purposes of this Agreement.
ARTICLE 16. Year 2000. BISYS agrees to perform comprehensive tests on
the systems it utilizes to provide the services hereunder to identify any
operational issues caused by the century change. BISYS agrees to use all
commercially reasonable efforts to implement by December 31, 1999, all necessary
updates and changes to such systems, if any, to accommodate the turn of the
century. BISYS agrees to provide to the Company monthly updates on the status of
its Year 2000 readiness project and to make its personnel reasonably available
to address any questions. In particular and, without limiting the foregoing,
BISYS shall notify the Company of any circumstances known to BISYS which are
likely to cause BISYS's systems to be Year 2000 non-compliant and which would
likely have an adverse effect on the Portfolios.
In the event that the Company reasonably determines that any of the
systems BISYS utilizes to perform services hereunder will not be Year 2000
compliant and that such lack of compliance will have an adverse effect on the
Company, the Company shall provide written notice to BISYS describing, in
reasonable detail, any defect or problem relating to such system(s) promptly
upon becoming aware of any such defect or problem. BISYS agrees to use all
commercially reasonable efforts to cure any defect or deficiency that relates to
the turn of the century in any system that BISYS utilizes to provide services
hereunder. This paragraph does not alter the obligations of BISYS under the
preceding paragraph.
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IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the day and year first above written.
ASSET MANAGEMENT FUND, INC.
By: /s/Xxxxxx X. Xxxxxxx, Xx.
-----------------------------
Title: President
--------------------------
BISYS FUND SERVICES OHIO, INC.
By:/s/ Xxxxxxx X. Xxxxx
-----------------------------
Title: President
--------------------------
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SCHEDULE A
TO THE ADMINISTRATION AGREEMENT
DATED AS OF AUGUST 1, 1999
BETWEEN
ASSET MANAGEMENT FUND, INC.
AND
BISYS FUND SERVICES OHIO, INC.
Portfolios: This Agreement shall apply to all Portfolios of Asset
Management Fund, Inc., either now or hereafter created (individually, the
"Portfolio", and collectively, the "Portfolios"). The current Portfolios of the
Company are set forth below:
- U.S. Government Mortgage Securities Portfolio
- Intermediate Mortgage Securities Portfolio
- Short U.S. Government Securities Portfolio
- Adjustable Rate Mortgage (ARM) Portfolio
- Money Market Portfolio
Term: Pursuant to Article 7, the term of this Agreement shall commence
on August 1, 1999 and shall remain in effect through July 31, 2004 ("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 without penalty (i) by
provision of 90 days advance written notice of nonrenewal prior to the end of
the Initial Term or any Rollover Period, as the case may be, (ii) by mutual
agreement of the parties or (iii) for "cause," as defined below, upon the
provision of 90 days advance written notice by the party alleging cause.
Notwithstanding the foregoing, after July 31, 2001, either party may terminate
this Agreement, at any time and without penalty, upon the provision of 90 days
advance written notice to the other party.
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
series of negligent acts or omissions or breaches of this Agreement which, in
the aggregate, constitute, in the reasonable judgment of the Company's
Directors, a serious failure to perform satisfactorily BISYS's obligations
hereunder; (c) a service standard deficiency (as defined by the parties in the
service standards that are agreed to by BISYS and the Company from time to
time); (d) 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 (e) 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.
Notwithstanding the foregoing, after such termination for so long as
BISYS, with the written consent of the Company, in fact continues to perform any
one or more of the services
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contemplated by this Agreement or any schedule or exhibit hereto, the provisions
of this Agreement, including without limitation the provisions dealing with
indemnification, shall continue in full force and effect. Compensation due BISYS
and unpaid by the Company upon such termination shall be immediately due and
payable upon and notwithstanding such termination. BISYS shall be entitled to
collect from the Company, in addition to the compensation described in this
Schedule A, the amount of all of BISYS's cash disbursements for services in
connection with BISYS's activities in effecting such termination, including
without limitation, the delivery to the Company and/or its designees of the
Company's property, records, instruments and documents.
If, for any reason other than nonrenewal, mutual agreement of the
parties or "cause," as defined above, during the first two years of the Initial
Term of this Agreement, BISYS is replaced as administrator, then the Company
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 due BISYS for the remainder of such two-year period,
assuming for purposes of calculation of the payment that such balance shall be
based upon the average amount of the Company's assets for the twelve months
prior to the date BISYS is replaced.
In the event the Company is merged into another legal entity in part or
in whole pursuant to any form of business reorganization (including without
limitation a purchase of assets) or is liquidated in part or in whole prior to
the expiration of the first two years of the Initial Term of this Agreement, the
parties acknowledge and agree that the Company shall be entitled to terminate
this Agreement; provided, however, that the liquidated damages provision set
forth above shall be applicable in those instances in which BISYS is not
retained by the other party to such business reorganization or any successor
entity to provide administration services consistent with this Agreement. The
one-time cash payment referenced above shall be due and payable on the day prior
to the first day in which BISYS is replaced.
The parties further acknowledge and agree that, in the event BISYS is
replaced as set forth above, (i) a determination of actual damages incurred by
BISYS would be extremely 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.
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XXXXXXXX X
TO THE ADMINISTRATION AGREEMENT
DATED AS OF AUGUST 1, 1999
BETWEEN
ASSET MANAGEMENT FUND, INC.
AND
BISYS FUND SERVICES OHIO, INC.
DETAILED SERVICE LISTING
ADMINISTRATION
1. Maintain and manage annual regulatory filing calendar.
2. Manage the process of printing and distributing prospectuses and
prospectus supplements. This includes, but is not limited to, decisions
regarding quantities and layout, price negotiation, invoice control and
management of the mailing process.
3. Manage the process of printing and distributing proxy materials. This
includes, but is not limited to, decisions regarding quantities,
compilation of shareholder data, price negotiation and management of
the mailing process.
4. Prepare and file Form N24-F2.
5. Obtain tax identification numbers from the IRS for each Fund portfolio.
6. Assist Fund in obtaining Fund ratings from NRSROs.
7. Obtain Fund CUSIPs.
8. Assist in the completion of trustee/officer questionnaires.
9. Assist the Fund in the preparation of appropriate documentation and
records relating to the contribution of seed money capital.
10. Maintain books and records on behalf of the Fund, as agreed upon by the
parties.
11. Make available persons to serve as officers of the Fund.
COMPLIANCE
1. Review monthly compliance reports that are prepared by the investment
adviser(s).
2. Perform independent monthly portfolio compliance testing.
3. Prepare quarterly tax compliance checklist for use by investment
adviser(s).
4. Notify appropriate Fund officers of xxxx-to-market issues pursuant to
Board-approved procedures.
5. Provide appropriate assistance with respect to SEC inspections
including (i) rendering advice regarding proposed responses (ii)
compiling data and other information in response to SEC requests for
information and (iii) communicating with SEC staff members, as
necessary.
6. Provide appropriate assistance with respect to audits conducted by the
Fund's independent accountants including (i) compiling data and other
information and (ii) communicating with independent accountants, as
necessary.
7. Consult with and advise, on a proactive basis, Fund portfolio managers
with respect to compliance matters.
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8. Prepare quarterly brokerage allocation compliance checklist and
supporting documentation for use by investment adviser(s).
9. Provide on-site compliance training for investment advisory personnel,
as requested.
10. Preparation of Fund-specific compliance manual.
TAX AND FINANCIAL SERVICES
1. Prepare semi-annual/annual financial statements.
2. Prepare and file Form N-SAR.
3. Calculate/distribute all standard performance information.
4. Prepare annual Fund expense budget and monthly accrual analyses.
5. Validate/approve Fund expenses to be paid.
6. Register Fund portfolios with NASDAQ.
7. Prepare financial materials for Board books.
8. Calculate declaration of income/capital gain distributions in
compliance with income/excise tax distribution requirements.
9. Review all dividend declarations to ensure that such distributions are
not "preferential" under the Internal Revenue Code.
10. Review and file federal and state income tax returns and federal excise
tax returns within statutory deadlines.
11. Prepare/distribute year-end shareholder tax information letters and
Forms 1099-MISC for trustee fees/vendor payments within 30 days of
calendar year-end.
12. Provide on-site compliance/consulting for portfolio managers focused on
the impact of changes in tax laws and managing a tax-efficient mutual
fund.
13. Provide on-site consulting services for conversions.
14. Provide expense budgeting consulting to review expense ratios/fee
waivers.
15. Leverage BISYS' relationships with all "Big 5" accounting firms for
clients' benefit.
16. Produce and coordinate the printing and distribution of
semi-annual/annual reports.
17. Calculate Funds performance information.
BLUE SKY
1. Qualify the Fund and its shares with appropriate state blue sky
authorities upon client authorization.
2. Amend and renew sales permits as required.
3. Monitor the sales of shares in individual states on a daily basis upon
receipt of sales information and, when required, report sales to
appropriate states.
4. Maintain Fund blue sky filing calendars.
5. Address all blue sky audit and examination issues.
6. Conduct blue sky fee analysis, upon request.
7. Produce checks required for state filing fees.
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14
LEGAL SERVICES
GENERAL
1. Maintain files of registration statements, Fund contracts, Fund proxies
and other Fund legal documents.
2. Provide legal consultation with respect to product development issues.
3. Provide assistance concerning matters pertaining to Federal securities
laws, bank regulatory issues, tax-related issues and ERISA issues.
4. Provide information concerning current legal and regulatory
developments.
5. Provide comments, as appropriate, concerning regulatory agency
proposals.
6. Maintain appropriate insurance coverage on behalf of the Fund in the
form of (i) a Directors & Officers/Errors & Omissions professional
liability and (ii) a Fidelity Bond.
7. Prepare memoranda and other correspondence that outlines the terms and
conditions of the insurance policies described in item 6 above.
BOARD MEETING MATTERS
1. Maintain calendar and files for all Board meetings, including the
maintenance of Fund minute books and corporate records (e.g., Articles
of Incorporation/Declaration of Trust, Bylaws).
2. Provide appropriate personnel to attend Board meetings.
3. Produce and distribute Board books.
4. Prepare relevant sections of Board materials.
5. Record minutes of Board meetings. (Counsel to the Fund will prepare
agendas and resolutions.)
REGISTRATION STATEMENTS
1. Manage the process of updating the registration statement by (i)
reviewing or recommending proposed disclosure changes, (ii) compiling
data for purposes of updating information, (iii) receiving disclosure
comments and communicating them to counsel to the Fund and to the
financial printer and (iv) overseeing the printing process and
approving revisions that are made by the financial printer. (Counsel to
the Fund will draft and file the registration statement.)
2. Prepare periodic supplements to Fund prospectuses or, if the parties
agree, review such supplements that are prepared by counsel to the
Fund.
PROXY MATERIALS
1. Review proxy statements that are prepared by counsel to the Fund.
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