EXHIBIT 9(b)
FUND ACCOUNTING AND ADMINISTRATION AGREEMENT
THIS AGREEMENT made as of March ___, 1997 by and between Security Capital
Employee REIT Fund Incorporated, a Maryland corporation (the "Fund"), and
Security Capital Investment Research Group Incorporated, a Delaware corporation
(the "Administrator").
W I T N E S S E T H:
WHEREAS, the Fund is an open-end, management investment company; and
WHEREAS, the Fund wishes to retain the Administrator to provide certain
fund accounting and administration services with respect to the Fund and the
Administrator is willing to furnish such services;
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, it is agreed between the parties hereto as follows:
1. Appointment. The Fund hereby appoints the Administrator to provide
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fund accounting and administration services to the Fund, subject to the
supervision of the Board of Directors of the Fund (the "Board of Directors"),
for the period and on the terms set forth in this Agreement. The Administrator
accepts such appointment and agrees to furnish the services herein set forth in
return for the compensation as provided in Paragraph 4 of this Agreement. In
the event that the Fund establishes one or more additional portfolios with
respect to which it decides to retain the Administrator to act as administrator
hereunder, the Fund shall notify the Administrator in writing. If the
Administrator is willing to render such services to a new portfolio, they shall
so notify the Fund in writing whereupon such portfolio shall become a Fund
hereunder and shall be subject to the provisions of this Agreement to the same
extent as the Fund, except to the extent that said provisions (including those
relating to the compensation payable by the Fund) may be modified with respect
to such portfolio in writing by the Fund and the Administrator at the time of
the addition of such new portfolio.
2. Delivery of Documents. The Fund has furnished the Administrator with
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copies, properly certified or authenticated, of each of the following:
(a) Resolutions of the Fund's Board of Directors authorizing the
appointment of the Administrator to provide certain fund accounting and
administration services to the Fund and approving this Agreement;
(b) The Fund's Articles of Incorporation ("Charter");
(c) The Fund's Bylaws ("Bylaws");
(d) The most recent draft of the Fund's Registration Statement on
Form N-1A and when completed, the Fund will provide its most recent Prospectus
and Statement of Additional Information and all amendments and supplements
thereto (such Prospectus and Statement of Additional Information
and supplements thereto, as presently in effect and as from time to time
hereafter amended and supplemented, herein called the "Prospectus").
The Fund will timely furnish the Administrator from time to time with
copies, properly certified or authenticated, of all amendments of or supplements
to the foregoing, if any.
3. Services and Duties. Subject to the supervision and control of the
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Fund's Board of Directors, the Administrator agrees to assist in supervising
aspects of the Fund's administrative operations, including but not limited to
the performance of the following specific services for the Fund:
(a) Provide office facilities (which may be in the offices of the
Administrator or a corporate affiliate of them, but shall be in such location as
the Fund shall reasonably approve) and the services of a principal financial
officer to be appointed by the Fund;
(b) Furnish statistical and research data, clerical services, and
stationery and office supplies;
(c) Keep and maintain all financial accounts and records (other than
those required to be maintained by the Fund's Custodian and Transfer Agent)
including without limit those required under Section 31(a) and Rule 3la-1 under
the Investment Company Act of 1940 (the "1940 Act");
(d) Compute, and transmit to the NASD service for the publication of
fund prices, the Fund's net asset value, net income and net capital gain (loss)
in accordance with the Fund's Prospectus and resolutions of its Board of
Directors;
(e) Compile data for, and prepare required reports and notices to
shareholders of record including, without limitation, proxy statements,
Semiannual and Annual Reports to shareholders;
(f) Compile data for, prepare for execution and file all reports or
other documents, including tax returns, required by Federal, state and other
applicable laws and regulations, including those required by applicable Federal
and state tax laws (other than those required to be filed by the Fund's
Custodian or Transfer Agent);
(g) Assist in developing and monitoring compliance procedures for the
Fund and any class or series thereof, including, without limitation, procedures
to monitor compliance with applicable law and regulations, the Fund's investment
objectives, policies and restrictions, its continued qualification as a
regulated investment company under Subchapter M of the Internal Revenue Code of
1986, as amended (the "Code");
(h) Determine, together with the Fund's Board of Directors, the
jurisdictions in which the Fund's shares shall be registered or qualified for
sale and, in connection therewith, the Administrator shall be responsible for
the registration for sale and maintenance of the registrations of shares for
sale under the securities laws of any state. Payment of share registration fees
for qualifying or continuing the qualification of Fund shares or the Fund as a
dealer or broker, if applicable, shall be made by the Fund;
(i) Provide financial data requested by the Fund and its outside
counsel;
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(j) Perform such other duties related to the administration of the
Fund's operations as reasonably requested by the Board of Directors, from time
to time;
(k) Assist in the monitoring of regulatory and legislative
developments which may affect the Fund and, in response to such developments,
counsel and assist the Fund in routine regulatory examinations or investigations
of the Fund, and work with outside counsel to the Fund in connection with
regulatory matters or litigation.
In performing its duties as administrator of the Fund, the Administrator
(a) will act in accordance with the Fund's Charter, Bylaws, Prospectus,
Statement of Additional Information and the instructions and directions of the
Fund's Board of Directors and will conform to, and comply with, the requirements
of the 1940 Act and all other applicable Federal or state laws and regulations,
and (b) will consult with outside legal counsel to the Fund, as necessary or
appropriate.
The Administrator will preserve for the periods prescribed by Rule 31a-2
under the 1940 Act the records required to be maintained by Rule 31a-1 under
said Act in connection with the services required to be performed hereunder.
The Administrator further agrees that all such records which it maintains for
the Fund are the property of the Fund and further agrees to surrender promptly
to the Fund any of such records upon the Fund's request.
4. Fees; Expenses; Expense Reimbursement. For the services rendered
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pursuant to this Agreement for the Fund, the Administrator shall be entitled to
a fee based on the average net assets of the Fund determined at the annual rate
outlined in Exhibit A and applied to the average daily net assets of the Fund.
Such fees are to be computed daily and paid monthly on the first business day of
the following month. Upon any termination of this Agreement before the end of
any month, the fee for such part of the month shall be prorated according to the
proportion which such period bears to the full monthly period and shall be
payable upon the date of termination of this Agreement.
For the purpose of determining fees payable to the Administrator, the value
of the Fund's net assets shall be computed as required by its Prospectus,
generally accepted accounting principles and resolutions of the Fund's Board of
Directors.
The Administrator will from time to time employ or associate with
themselves such person or persons as they may believe to be fitted to assist
them in the performance of this Agreement. Such person or persons may be
officers and employees who are employed by both the Administrator and the Fund.
The compensation of such person or persons for such employment shall be paid by
the Administrator and no obligation may be incurred on behalf of the Fund in
such respect.
The Administrator will bear all expenses in connection with the performance
of its services under this Agreement except as otherwise expressly provided
herein. Other expenses to be incurred in the operation of the Fund, including
taxes, interest, brokerage fees and commissions, if any, salaries and fees of
officers and directors who are not officers, directors shareholders or employees
of the Administrator, or the Fund's investment advisor or distributor for the
Fund, Securities and Exchange Commission fees and state Blue Sky qualification
fees, advisory and administration fees, charges of custodians, transfer and
divided disbursing agents' fees, certain insurance premiums including fidelity
bond premiums, outside auditing and legal expenses, costs of maintenance of
corporate existence, typesetting and printing of prospectuses for regulatory
purposes and for distribution to current shareholders of the Fund, costs of
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shareholders, reports and corporate meetings and any extraordinary expenses,
will be borne by the Fund, provided, however, that, except as provided in any
distribution plan adopted by the Fund, the Fund will not bear, directly or
indirectly, the cost of any activity which is primarily intended to result in
the distribution of shares of the Fund, and further provided that the
Administrator may utilize one or more independent pricing services, approved
from time to time by the Board of Directors of the Fund, to obtain securities
prices in connection with determining the net asset value of the Fund and that
the Fund will reimburse the Administrator for its share of the cost of such
services based upon its actual use of the services.
If in any fiscal year the Fund's aggregate expenses (as defined under the
securities regulations of any state having jurisdiction over the Fund) exceed
the expense limitations of any such state, the Administrator agrees to reimburse
the Fund for a portion of any such excess expense in an amount equal to the
proportion that the fee otherwise payable to the Administrator bear to the total
amount of investment advisory and administration fees otherwise payable by the
Fund. The expense reimbursement obligation of the Administrator is limited to
the amount of its fees hereunder for such fiscal year, provided, however, that
notwithstanding the foregoing, the Administrator shall reimburse the Fund for a
portion of any such excess expenses in an amount equal to the proportion that
the fees otherwise payable to the Administrator bear to the total amount of
investment advisory and administration fees otherwise payable by the Fund
regardless of the amount of fees paid to the Administrator during such fiscal
year to the extent that the securities regulations of any state having
jurisdiction over the Fund so require. Such expense reimbursement, if any, will
be estimated on daily basis, reconciled and paid on a monthly basis.
5. Proprietary and Confidential Information. The Administrator agrees on
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behalf of itself and its employees to treat confidentially and as proprietary
information of the Fund all records and other information relative to the Fund's
prior, present or potential shareholders, and not to use such records and
information for any purpose other than performance of their responsibilities and
duties hereunder, except after prior notification to and approval in writing by
the Fund, which approval shall not be unreasonably withheld and may not be
withheld where the Administrator may be exposed to Civil or Criminal contempt
proceedings for failure to comply, when requested to divulge such information by
duly constituted authorities, or when so requested by the Fund.
6. Limitation of Liability. The Administrator shall not be liable for
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any error of judgement or mistake of law or for any loss or expense suffered by
the Fund, in connection with the matters to which this Agreement relates, except
for a loss or expense resulting from willful misfeasance, bad faith or gross
negligence on its part in the performance of its duties or from reckless
disregard by it of its obligations and duties under this Agreement. Any person,
even though also an officer, director, partner, employee or agent of the
Administrator, who may be or become an officer, director, employee or agent of
the Fund, shall be deemed when rendering services to the Fund or acting on any
business of the Fund (other than services or business in connection with the
Administrator's duties hereunder) to be rendering such services to or acting
solely for the Fund and not as an officer, director, partner, employee or agent
or one under the control or direction of the Administrator even though paid by
them.
7. Terms. This Agreement shall become effective on the date first
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hereinabove written and, unless sooner terminated as provided herein, shall
continue in effect from year to year thereafter, provided such continuance is
specifically approved at least annually (i) by the Fund's Board of Directors or
(ii) by a vote of a majority (as defined in the 0000 Xxx) of the outstanding
voting securities of the Fund, provided that in either event the continuance is
also approved by the majority of the Fund's Board of Directors who
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are not interested persons (as defined in the 0000 Xxx) of any party to this
Agreement, by vote cast in person at a meeting called for the purpose of voting
on such approval. This Agreement is terminable, without penalty, by the Fund's
Board of Directors, by vote of a majority (as defined in the 0000 Xxx) of the
outstanding voting securities of such Fund, or by the Administrator, on not less
than sixty days, notice. This agreement shall automatically terminate upon its
assignment by the Administrator without the prior written consent of the Fund,
provided, however, that no such assignment shall release the Administrator from
its obligations under this Agreement.
8. Governing Law. This Agreement shall be governed by Illinois law.
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9. Amendments. No provision of this Agreement may be changed,
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discharged, or terminated orally, but only by an instrument in writing signed by
the party against which enforcement of the change, discharge or termination is
sought.
10. Miscellaneous. The parties to this Agreement acknowledge and agree
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that all liabilities arising, directly or indirectly, under this Agreement, of
any and every nature whatsoever, including without limitation, liabilities
arising in connection with any agreement of the Fund set forth herein to
indemnify any party to this Agreement or any other person, shall be satisfied
out of the assets of the Fund and that no director officer or shareholder of the
Fund shall be personally liable for any of the foregoing liabilities.
If a change or discharge is sought against the Fund, the instrument must be
signed by the Administrator.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their officers designated below as of the date indicated below.
SECURITY CAPITAL EMPLOYEE REIT
FUND INCORPORATED
ATTEST: By:
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(Title)
SECURITY CAPITAL INVESTMENT
RESEARCH GROUP INCORPORATED
ATTEST: By:
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(Title)
EFFECTIVE AS OF:
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EXHIBIT A
FUND ACCOUNTING AND FUND ADMINISTRATION
FEE SCHEDULE
FOR
SECURITY CAPITAL EMPLOYEE REIT FUND INCORPORATED
Annual Rate: .15% (15 basis points) of the average daily net assets of the
Fund billed monthly.
Note:
1. The annual rate is subject to a monthly minimum of $5,000.00.
2. Out-of-pocket expenses will be billed to the Fund separately.
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