EXHIBIT 2
ADMINISTRATION AGREEMENT
ADMINISTRATION AGREEMENT, made as of the September __, 2004 between Xxxxx
Xxxxxxxx MLP Investment Company, a Maryland corporation (the "Fund") and Bear
Xxxxxxx Funds Management Inc., a Delaware corporation (the "Administrator").
W I T N E S S E T H:
WHEREAS, the Fund is a closed-end, non-diversified, management investment
company registered under the Investment Company Act of 1940, as amended (the
"Investment Company Act") and
WHEREAS, the Fund has retained an investment adviser for the purpose of
investing its assets in securities and desires to retain the Administrator for
certain administrative services, and the Administrator is willing to furnish
such administrative services on the terms and conditions hereinafter set forth;
NOW, THEREFORE, the parties hereto agree as follows:
1. Appointment. The Fund hereby appoints the Administrator to provide the
services set forth below, subject to the overall supervision of the Board
of Directors of the Fund (the "Board") for the period and on the terms set
forth in this Agreement. The Administrator hereby accepts such appointment
and agrees during such period to render the services herein described and
to assume the obligations herein set forth; for the compensation herein
provided.
2. Description of Services. Subject to the supervision of the Board and the
officers of the Fund, the Administrator shall provide office facilities
and personnel to assist the officers of the Fund in the performance of the
following services:
(a). Consult with the Fund's officers, independent accountants, legal
counsel, custodian, accounting agent and transfer and dividend
disbursing agent in establishing the accounting policies of the
Fund;
(b). Oversee the maintenance by the Fund's custodian of certain books and
records of the Fund as required under the Investment Company Act and
maintain (or oversee maintenance by such other persons as approved
by the Board) such other books and records (other than those
maintained by the investment adviser and other fund service
providers) required by law or for the proper operation of the Fund;
(c). Review the appropriateness of and arrange for the payment of the
Fund's expenses;
(d). Oversee and review calculations of fees paid to the Administrator,
the Investment Adviser, the custodian, and any other service
providers of the Fund as determined and recorded by the Fund's
Accounting Agent;
(e). Prepare, maintain and disseminate total return performance
calculations on at least a monthly basis;
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(f). Prepare for review and approval by officers of the Fund, financial
information for the Fund's quarterly, semi-annual, annual and other
periodic reports, proxy statements and other communications with
shareholders required or otherwise to be sent to the Fund's
shareholders, and arrange for the printing and dissemination of such
reports and communications to shareholders;
(g). Prepare for review by an officer of the Fund, the Fund's periodic
financial reports required to be incorporated into and filed with
the Securities and Exchange Commission ("SEC") on Form N-Q, Form
N-CSR, Form N-SAR and Form N-2 and such other reports, forms or
filings, as may be mutually agreed upon;
(h). Prepare the financial information for certain SEC filings (e.g.,
proxy statements), review such filings as prepared by the Fund's
counsel in their entirety and provide comments to the Fund's
management and other appropriate parties (e.g., legal counsel);
(i). Assist in the preparation and the filing of the Fund's federal,
state and local income tax returns and any other required tax
return;
(j). Prepare, distribute and file with the Internal Revenue Service, Form
1099-MISC for payments made to the Fund's directors, legal counsels
and independent public accountants;
(k). Compute the amount of dividends and distributions to be paid by the
Fund; ensure proper notification accompanying payment(s), if
applicable, and year-end reporting of such dividends and
distributions;
(l). Develop and implement procedures to assist the investment adviser in
monitoring, on a periodic basis, compliance with regulatory
requirements and the Fund's investment objectives, policies and
restrictions as set forth in the Fund's prospectus and as amended by
the Board and by the Fund's shareholders;
(m). Review implementation of any stock purchase or dividend reinvestment
programs authorized by the Board;
(n). Review of dividend and distribution notifications sent to Fund
shareholders;
(o). Assist the Fund in obtaining any required insurance;
(p). File with the SEC the fidelity bond and arrange for the preparation
of a memorandum or other appropriate correspondence that outlines
the terms and conditions of such policy;
(q). Prepare such financial information reports as may be required by any
stock exchange or exchanges on which the Fund's shares are listed;
(r). Monitor any share repurchase program the Fund may engage in,
including the timely reporting of such information to any stock
exchange or exchanges on which the Fund's shares are listed;
(s). Review the notice and agenda for any regularly scheduled board
meetings, audit committee
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meeting or other meetings of committees of the board, as drafted by
fund counsel or other competent parties. Such notices and agendas
will be subject to the approval of fund counsel prior to the
distribution to the Board or any committee members thereof;
(t). Assist fund management and fund counsel in the coordination of the
production and distribution of the board materials to the directors,
officers and other directly-interested parties (e.g., legal counsel,
independent public accountants) to and provide meeting facilities,
if necessary;
(u). Review drafts of the minutes of meetings of the Board (including
committees thereof) and shareholder meetings as prepared by fund
counsel or other competent parties, incorporating comments and
revisions received from fund management, fund counsel and other
interested parities;
(v). Manage the process with respect to the shareholder meetings.
Specifically, arrange for the solicitation of proxies (including
engaging a proxy solicitor), overseeing the tabulation of votes, and
providing the meeting facilities, if necessary;
(w). Gather news and market updates on the Fund;
(x). Respond to or refer to the Fund's officers or transfer agent,
shareholder inquiries relating to the Fund;
(y). Prepare reports relating to the business and affairs of the Fund as
may be mutually agreed upon and not otherwise appropriately prepared
by the Fund's investment adviser, custodian, legal counsel or
independent public accountants;
(z). Make such reports and recommendations to the Board concerning the
performance and fees of the Fund's other service providers as the
Board may reasonably request or deem appropriate;
(aa). Provide communication and coordination services with regard to the
Fund's investment adviser, transfer and disbursing agent, custodian
and other service providers that render recordkeeping or shareholder
communication services to the Fund; and
(bb). Provide such assistance to the investment adviser, the custodian and
the Fund's legal counsel and auditors as generally may be required
to properly carry on the business and operations of the Fund
All services are to be furnished through the medium of any directors, officers
or employees of the Administrator, as the Administrator deems appropriate in
order to fulfill its obligations hereunder.
Each party shall bear all its own expenses incurred in connection with this
Agreement, except as noted below.
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3. Compensation. The Fund will pay the Administrator a monthly fee at the
annual rate of 0.10% of the first $150 million; 0.08% on the next $100
million; and 0.07% or amounts over $250 million of it's average net assets
based on the net asset value on the last day of each week and on which the
New York Stock Exchange is open for business, subject to a minimum annual
fee of $75,000 for each. In addition to the fee, the Fund would be
required to reimburse to the Administrator all out-of-pocket expenses
incurred by the Administrator for attendance at any meetings (outside of
the New York metropolitan area) of the Board, or any committees of such
Board, or at any other meetings or presentations for which the
Administrator is required to attend.
4. Responsibility of Administrator. The Administrator assumes no
responsibility under this Agreement other than to render the services
called for hereunder, and specifically assumes no responsibilities for
investment advice or the investment or reinvestment of the Fund's assets.
5. Indemnification. The Administrator shall not be liable to the Fund for any
action taken or omitted to be taken by the Administrator in connection
with the performance of any of its duties or obligations under this
Agreement, and the Fund shall indemnify the Administrator and hold it
harmless from and against all damages, liabilities, costs and expenses
(including reasonable attorneys' fees and amounts reasonably paid in
settlement) incurred by the Administrator in or by reason of any pending,
threatened or completed action, suit, investigation or other proceeding
(including an action or suit by or in the right of the Fund or its
security shareholders) arising out of or otherwise based upon any action
actually or allegedly taken or omitted to be taken by the Administrator in
connection with the performance of any of its duties or obligations under
this Agreement; provided, however, that nothing contained herein shall
protect or be deemed to protect the Administrator against or entitle or be
deemed to entitle the Administrator to indemnification in respect of any
liability to the Fund or its security holders to which the Administrator
would otherwise be subject by reason of willful misfeasance, bad faith or
gross negligence in the performance of its duties or, by reason of its
reckless disregard of its duties and obligations under this Agreement. The
Administrator shall indemnify the Fund for damages resulting from the
Administrator's willful misfeasance, bad faith or gross negligence in the
performance of any of its duties or obligations under this Agreement. In
no event shall the Administrator be liable for, or be obligated to
indemnify the Fund for, special, indirect or consequential damages even if
the Administrator has been advised of the possibility of such damages.
6. Duration and Termination. This Agreement shall become effective as of the
date hereof and shall thereafter continue in effect unless terminated as
herein provided. This Agreement may be terminated by either party hereto
(without penalty) at any time by giving not less than 60 days' prior
written notice to the other party hereto.
7. Services to Others. The services of the Administrator to the Fund
hereunder are not exclusive and nothing in this Agreement shall limit or
restrict the right of the Administrator to engage in any other business or
to render services of any kind to any other corporation, firm, individual
or association. The Administrator shall be deemed to be an independent
contractor, unless otherwise expressly provided or authorized by this
Agreement.
8. References to the Administrator. During the term of this Agreement, the
Fund agrees to furnish the Administrator at the principal office of the
Administrator prior to use thereof all prospectuses, proxy statements,
reports to shareholders, sales literature, or other material
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prepared for distribution to shareholders of the Fund or the public that
refer in any way to the Administrator. If the Administrator reasonably
objects in writing to such references within five business days (or such
other time as may be mutually agreed) after receipt thereof, the Fund will
modify such references in a manner reasonably satisfactory to the
Administrator. In the event of termination of this Agreement, the Fund
will continue to furnish to the Administrator copies of any of the
above-mentioned materials that refer in any way to the Administrator and,
as soon as practicable after such termination, shall eliminate all
references to the Administrator in all written materials used thereafter.
The Fund shall furnish or otherwise make available to the Administrator
such other information relating to the business affairs of the Fund as the
Administrator at any time, or from time to time, reasonably requests in
order to discharge its obligations hereunder.
9. Record Retention and Confidentiality. Bear Xxxxxxx Funds Management Inc.
shall keep and maintain on behalf of the Fund all books and records which
the Fund and Bear Xxxxxxx Funds Management Inc. 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. Bear Xxxxxxx Funds Management
Inc. further agrees that all such books and records shall be the property
of the Fund and to make such books and records available for inspection by
the Fund or by the SEC at reasonable times and otherwise to keep
confidential all books and records and other information relative to the
Fund and its shareholders; except when requested to divulge such
information by duly-constituted authorities or court process.
10. Amendments. This Agreement may be amended only by mutual written consent.
11. Notices. Any notice or other communication required to be given pursuant
to this Agreement shall be deemed duly given if delivered or mailed by
registered mail, postage prepaid, (1) to the Administrator at 000 Xxxxxxx
Xxxxxx, 00xx xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxx X. Xxxxxxx,
President and Chief Executive Officer or (2) to the Fund at____________ ,
Attention:__________.
12. Entire Agreement. This Agreement sets forth the entire agreement and
understanding of the parties hereto solely with respect to the matters
covered hereby and the relationship between the Fund and Bear Steams Funds
Management Inc. as Administrator. Nothing in this Agreement shall govern,
restrict or limit in any respect any other business dealings between the
parties hereto unless otherwise expressly provided herein.
13. Governing, Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware without reference to
choice of law principles thereof and in accordance with the Investment
Company Act. In the case of any conflict the Investment Company Act shall
control.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed by their officers designated below as of the day and year first above
written.
ATTEST: XXXXX XXXXXXXX MLP INVESTMENT COMPANY
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_______________________ By:_________________________________
Name:
Title:
ATTEST: BEAR XXXXXXX FUNDS MANAGEMENT INC.
_______________________ By:_________________________________
Name: Xxxxx X. Xxxxxxx
Title: President and Chief
Executive Officer
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