SERVICE AGREEMENT
(As amended September 9, 1977)
STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, an Illinois
corporation (Auto Company), STATE FARM INVESTMENT MANAGEMENT CORP., a Delaware
corporation and a wholly-owned second-tier subsidiary of Auto Company (Manager),
and STATE FARM INTERIM FUND, INC., a Maryland corporation and an open-end
diversified management investment company registered under the Investment
Company Act of 1940 (Fund) to which Manager is investment adviser under an
Investment Advisory and Management Services Agreement dated December 21, 1976
and amended September 9, 1977 agree that:
1. Manager shall have the right to use, and Auto Company shall make
available for the use of Manager, (i) such part-time services of employees of
Auto Company engaged in its investment operations, and such services of
administrative and other employees of Auto Company, for periods to be agreed
upon by Manager and Auto Company, and (ii) such administrative, clerical,
stenographic and other support services and office supplies and equipment, as
may in each case be reasonably required by Manager in the performance of its
obligations as investment adviser to the Fund under their Investment Advisory
and Management Services Agreement and any agreements amending or superseding
such agreement.
2. Manager shall have the right to use, and Auto Company shall furnish
for the use of Manager such office space as is reasonably needed by Manager in
the performance of its obligations as investment adviser to the Fund.
3. In performing services for Manager under this agreement, the
employees of Auto Company may, to the full extent that they deem appropriate,
have access to and utilize statistical and economic data, investment research
and reports and other information prepared for or contained in the files of the
Auto Company which are relevant to making investment decisions within the
investment objectives of the Fund, and may make such information available to
Manager; provided, that any such information prepared or obtained in connection
with a private placement or other nonpublic transaction need not be made
available to Manager if Auto Company deems such information confidential.
4. Employees of Auto Company performing services for Manager pursuant
hereto shall report and be responsible solely to the officers and directors of
Manager or persons designated by them. Auto Company shall have no
responsibility for investment recommendations and decisions of Manager based
upon information or advice given or obtained by or through such Auto Company
employees; provided, however, that the foregoing shall not be construed to
relieve Auto Company of any liability to the Fund or its security holders to
which the Auto Company would otherwise be subject by reason of its willful
misfeasance, bad faith or gross negligence, in the performance of its duties
hereunder, or by reason of its reckless disregard of its obligations and duties
hereunder.
5. The obligation of performance of the Investment Advisory and
Management Services Agreement of Manager with the Fund is solely that of
Manager, for which Auto Company assumes no responsibility except as otherwise
expressly provided herein.
6. In consideration of the services to be rendered and the facilities
to be provided to Manager by Auto Company and its employees pursuant to this
agreement, Manager agrees to reimburse Auto Company for such costs, direct and
indirect, as may be fairly attributable to the services performed and the
facilities provided for Manager. Such costs shall include, but shall not be
limited to, an appropriate portion of salaries, employee benefits, general
overhead expense, and supplies and equipment, and a charge in the nature of rent
for the cost of space in the Auto Company offices fairly allocable to activities
of Manager under its Investment Advisory and Management Services Agreement with
the Fund. In the event of disagreement between Manager and Auto Company, as to
a fair basis for allocating or apportioning costs, such basis shall be fixed by
the independent public accountants for the Fund.
7. This agreement shall become effective on the date hereof and shall
continue in effect until December 1, 1978, and thereafter shall continue in
effect from year to year if its continuance is specifically approved by (i) the
vote of a majority of the outstanding voting securities of the Fund (as defined
in section 2(a)(42) of the Investment Company Act of 1940 ("Act")), or (ii) the
vote of a majority of the Board of Directors of the Fund, and in either case by
a majority of the Directors of the Fund who are not parties to the agreement or
interested persons (as defined in section 2(a)(19) of the Act) of the Fund, Auto
Company or Manager, voting in person at a meeting called for such purpose;
provided, however, that this agreement (a) may be terminated at any time,
without the payment of any penalty, either by the Board of Directors of the Fund
or by vote of a majority of the outstanding voting securities of the Fund, on
sixty days' written notice to Manager and to Auto Company, (b) shall terminate
automatically in the event of its assignment (as defined in section 2(a)(4) of
the Act), and (c) may be terminated by Manager or by Auto Company on sixty days'
written notice to each other and to the Fund.
8. This agreement may be amended at any time by mutual consent of the
parties, provided that such amendment shall not become effective until it has
been approved by vote of a majority of the outstanding voting securities of the
Fund.
9. Any notice under this agreement shall be in writing, addressed and
delivered or mailed postage prepaid to the other parties, at such addresses as
such other parties may designate for the receipt of such notices. Until further
notice to the other parties, it is agreed that the address of Auto Company, that
of Manager and that of the Fund for this purpose shall be Xxx Xxxxx Xxxx Xxxxx,
Xxxxxxxxxxx, Xxxxxxxx 00000.
Dated: December 21, 1976
Amended September 9, 1977
STATE FARM INVESTMENT MANAGEMENT CORP.
By: /s/ Xxxxx Xxxxxx
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Vice President
STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY
By: /s/ Xxxxxx X. Xxxx
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Vice President - Operations
STATE FARM INTERIM FUND, INC.
By: /s/ Xxxxxx X. Xxxx
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President
