EXHIBIT 5(C)
ADMINISTRATION AGREEMENT
AGREEMENT made this 1st day of January, 1998 by and between Xxxx Xxxxx
Capital Management, Inc. ("Adviser"), a Maryland corporation, and Xxxx Xxxxx
Fund Adviser, Inc. ("Administrator"), a Maryland corporation, each of which is
registered as an investment adviser under the Investment Advisers Act of 1940.
WHEREAS, the Adviser is the investment adviser of Xxxx Xxxxx Tax Exempt
Trust, Inc. (the "Corporation" or "Fund"), an open-end, diversified management
investment company registered under the Investment Company Act of 1940, as
amended (the "1940 Act"); and
WHEREAS, the Adviser wishes to retain the Administrator to provide it
with certain administrative services in connection with the Adviser's management
of the Corporation; and
WHEREAS, the Administrator is willing to furnish such services on the
terms and conditions hereinafter set forth:
NOW, THEREFORE, in consideration of the promises and mutual covenants
herein contained, it is agreed as follows:
1. Appointment. The Adviser hereby appoints the Administrator as
administrator for the Corporation 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 for the compensation herein provided.
2. Delivery of Documents. The Adviser has furnished the Administrator
with copies properly certified or authenticated of each of the following:
(a) The Corporation's Articles of Incorporation, as filed with
the State Department of Assessments and Taxation of the State of Maryland and
all amendments thereto;
(b) The Corporation's Bylaws and all amendments thereto;
(c) Resolutions of the Corporation's Board of Directors
authorizing the appointment of the Adviser as the investment adviser and the
Administrator as administrator, and approving the Investment Advisory and
Management Agreement between the Adviser and the Corporation dated January 1,
1998 (the "Advisory Agreement") and this Agreement;
(d) The Corporation's Registration Statement on Form N-1A
under the Securities Act of 1933, as amended, and the 1940 Act as filed with the
Securities and Exchange Commission, including all exhibits thereto, relating to
shares of common stock of the Fund, par value $.001 per share and all amendments
thereto;
(e) The Fund's most recent prospectus; and
(f) The Fund's most recent statement of additional
information.
The Adviser will furnish the Administrator from time to time with copies of all
amendments of or supplements to the foregoing.
3. Administrative Services. The Administrator, at its expense, shall
supply the Board of Directors and officers of the Corporation with all
statistical information and reports
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reasonably required by them and reasonably available to the Administrator and
shall furnish the Fund with office facilities, including space, furniture and
equipment and all personnel reasonably necessary for the operation of the Fund.
The Administrator shall oversee the maintenance of all books and records with
respect to the Fund's securities transactions and the keeping of the Fund's
books of accounts in accordance with all applicable federal and state laws and
regulations. In compliance with the requirements of Rule 31a-3 under the 1940
Act, the Administrator hereby agrees that any records which it maintains for the
Fund are the property of the Fund, and further agrees to surrender promptly to
the Fund or its agents any of such records upon the Fund's request. The
Administrator further agrees to arrange for the preservation of the records
required to be maintained by Rule 31a-1 under the 1940 Act for the periods
prescribed by Rule 31a-2 under the 1940 Act.
4. Services Not Exclusive. The Administrator's services hereunder are
not deemed to be exclusive, and the Administrator shall be free to render
similar services to others. It is understood that persons employed by the
Administrator to assist in the performance of its duties hereunder might not
devote their full time to such service. Nothing herein contained shall be deemed
to limit or restrict the right of the Administrator or any affiliate of the
Administrator to engage in and devote time and attention to other businesses or
to render services of whatever kind or nature.
5. Expenses. During the term of this Agreement, the Administrator will
pay all expenses incurred by it in connection with its activities under this
Agreement.
6. Compensation. For the services which the Administrator will render
to the Adviser and the Fund under this Agreement, the Adviser will pay the
Administrator a fee, computed daily and paid monthly, at an annual rate equal to
0.05% of the Fund's average daily net assets. Fees due to the Administrator
hereunder shall be paid promptly to the Administrator by the Adviser following
its receipt of fees from the Fund. If this Agreement is terminated as of any
date not the last day of a calendar month, a final fee shall be paid promptly
after the date of termination and shall be based on the percentage of days of
the month during which the contract was still in effect.
7. Limitation of Liability. The Administrator will not be liable for
any error of judgment or mistake of law or for any loss suffered by the Adviser
or by the Fund in connection with the performance of this Agreement, except a
loss resulting from a breach of fiduciary duty with respect to the receipt of
compensation for services or a loss 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 or duties under this Agreement.
8. Definitions. As used in this Agreement, the term "securities" shall
have the meaning ascribed to it in the Articles of Incorporation of the
Corporation; and the terms "assignment" and "interested person" shall have the
meanings given to them by Section 2(a) of the 1940 Act, subject to such
exemptions as may be granted by the Securities and Exchange Commission by any
rule, regulation or order.
9. Duration and Termination. This Agreement will become effective
January 1, 1998, provided that it shall have been approved by the Corporation's
Board of Directors, including a majority of those Directors who are not
interested persons of the Adviser or the
Administrator and, unless sooner terminated as provided for herein, shall
continue in effect until January 1, 2000, and from year to year thereafter,
provided such continuation is approved at least annually by the Board of
Directors, including a majority of those Directors who are not interested
persons of the Adviser or the Administrator. This Agreement is terminable
without penalty, by the Adviser or by the Administrator, on not less than 60
days' notice to the other party and will be terminated immediately upon any
termination of the Advisory Agreement with respect to the Fund or upon the
mutual written consent of the Administrator and the Adviser. Termination of this
Agreement with respect to the Fund shall in no way affect continued performance
with regard to any other portfolio of the Corporation. This Agreement will
automatically and immediately terminate in the event of its assignment.
10. Further Actions. Each party agrees to perform such further acts and
execute such further documents as are necessary to effectuate the purposes
hereof.
11. Amendments. No provision of this Agreement may be changed, waived,
discharged or terminated orally, but only by an instrument in writing signed by
the party against which enforcement of the change, waiver, discharge or
termination is sought.
12. Miscellaneous. This Agreement embodies the entire agreement and
understanding between the parties hereto, and supersedes all prior agreements
and understandings relating to the subject matter hereof. The captions in this
Agreement are included for convenience of reference only and in no way define or
delimit any of the provisions hereof or otherwise affect their construction or
effect. Should any part of this Agreement be held or made invalid by a court
decision, statute, rule or otherwise, the remainder of this Agreement shall not
be affected thereby. This Agreement shall be binding and shall inure to the
benefit of the parties hereto and their respective successors.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their officers designated below on the day and year first above
written.
XXXX XXXXX CAPITAL MANAGEMENT, INC.
Attest:
/s/ Xxxxxxx X. Xxxxxx /s/ Xxxxxx X. Xxxxx
By:___________________________ By:________________________________
XXXX XXXXX FUND ADVISER, INC.
Attest:
/s/ Xxxxx X. Xxxx /s/ Xxxxx X. Xxxxxxxxx
By:___________________________ By:________________________________
