EXHIBIT 9(g)
ADMINISTRATION AGREEMENT
(Xxxxxxx High-Yield Bond Fund)
THIS AGREEMENT is made as of April 6, 1998, by and between XXXXXXX
INVESTMENTS, a Massachusetts business trust (the "Trust"), acting on behalf
of the Xxxxxxx High-Yield Bond Fund (the "Fund"), and XXXXXX MANAGEMENT
CORPORATION ("Xxxxxx Management"), a Michigan corporation.
WHEREAS, the Trust is an open-end diversified management investment
company registered under the Investment Company Act of 1940, as amended (the
"1940 Act"), consisting of several series of shares of Common Stock; and
WHEREAS, the Trust desires Xxxxxx Management to provide, and Xxxxxx
Management is willing to provide, management and administrative services to
the Fund such other portfolios of the Trust as the Trust and Xxxxxx
Management may hereafter agree on ("Portfolios") and as are listed on a
schedules attached hereto ("Schedules") or hereafter made a part of this
Agreement, on the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the covenants
hereinafter contained, the Trust and Xxxxxx Management hereby agree as
follows:
1. Retention of Xxxxxx Management. The Trust hereby retains
Xxxxxx Management to act as the administrator of the Portfolios and to
furnish the Portfolios with the management and administrative services as
set forth in Section 2 below. Xxxxxx Management hereby accepts such
employment to perform the duties set forth below. Xxxxxx Management 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 Trust in any way and shall not be deemed an
agent of the Trust.
2. Administrative and Accounting Services. Xxxxxx Management
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 Trust, 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. Xxxxxx Management shall provide the Trustees of
the Trust with such reports regarding investment performance and compliance
with investment policies and applicable laws, rules and regulations as they
may reasonably request but shall have no responsibility for supervising the
performance by any investment adviser or sub-adviser of its
responsibilities.
Xxxxxx Management shall provide the Trust with administrative
services, regulatory reporting, fund accounting and related portfolio
accounting services, all necessary office space, equipment, personnel,
compensation and facilities (including facilities for shareholders' meetings
but not Trustees' meetings that are not held at offices of Xxxxxx
Management) for handling the affairs of the Portfolios and such other
services as the Trustees may, from time to time, reasonably request and
Xxxxxx Management shall, from time to time, reasonably determine to be
necessary to perform its obligations under this Agreement. In addition, at
the request of the Trust's Board of Trustees (the "Trustees"), Xxxxxx
Management shall make reports to the Trustees concerning the performance of
its obligations hereunder.
Without limiting the generality of the foregoing, Xxxxxx Management
shall:
(a) calculate contractual expenses and control all
disbursements for the Portfolios, and as appropriate compute the
yields, total return, expense ratios, portfolio turnover rate and,
if required, portfolio average dollar-weighed maturity for the
Portfolios;
(b) assist Trust counsel with the preparation of
prospectuses, statements of additional information, registration
statements, and proxy materials for the Portfolios;
(c) prepare such reports, applications and documents
(including reports regarding the sale and redemption of shares as
may be required in order to comply with Federal and state securities
law) as may be necessary or desirable to register the Portfolios'
shares with state securities authorities, monitor sale of Portfolio
shares for compliance with state securities laws, and file with the
appropriate state securities authorities the registration statements
and reports for the Portfolios and the Portfolios' shares and all
amendments thereto, as may be necessary or convenient to register
and keep effective the Portfolios' shares with state securities
authorities to enable the Trust to make a continuous offering of the
Portfolios' shares;
(d) develop and prepare communications to shareholders,
including the annual report to shareholders, coordinate mailing
prospectuses, notices, proxy statements, proxies and other reports
to shareholders of the Portfolios, and supervise and facilitate the
solicitation of proxies for all shareholder meetings of the
Portfolios, including tabulation process for such shareholder
meetings;
(e) coordinate with Trust counsel the preparation and
negotiation of, and administer, contracts on behalf of the
Portfolios with, among others, the Trust's investment adviser,
distributor, custodian, and transfer agent;
(f) maintain the Portfolios' general ledger and prepare
the Portfolios' financial statements, including expense accruals and
payments, determine the net asset value of the Portfolios' assets
and of the Portfolios' shares, and supervise the Portfolios'
transfer agent with respect to the payment of dividends and other
distributions to shareholders;
(g) calculate performance data of the Portfolios for
dissemination to information services covering the investment
company industry;
(h) coordinate and supervise the preparation and filing
of the Portfolios' tax returns;
(i) examine and review the operations and performance
of the various organizations providing services to the Trust or any
of the Portfolios, including, without limitation, the Portfolios'
investment adviser, distributor, custodian, transfer agent, counsel
and independent public accountants;
(j) assist with the layout and printing of publicly
disseminated prospectuses and assist with and coordinate layout and
printing of the Portfolios' semi-annual and annual reports to
shareholders;
(k) assist with the design, development, and operation
of the Portfolios, including new portfolio and class investment
objectives, policies and structure;
(l) provide individuals acceptable to the Trustees for
nomination, appointment, or election as officers of the Trust, who
will be responsible for the management of certain of the Trust's
affairs as determined by the Trustees;
(m) advise the Trust and its Trustees on matters
concerning the Trust and its affairs;
(n) obtain and keep in effect fidelity bonds and
directors and officers/errors and omissions insurance policies for
the Portfolios 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 Portfolios' Board of Trustees;
(o) monitor and advise the Trust 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 Trust and each Portfolio to the extent administrative
services and functions are not provided to the Trust or such
Portfolio pursuant to the Trust's or such Portfolio's investment
advisory agreement, distribution agreement, custodian agreement and
transfer agent agreement;
(q) furnish advice and recommendations with respect to
other aspects of the business and affairs of the Portfolios as the
Trust and Xxxxxx Management shall determine desirable;
(r) prepare and file with the SEC the semi-annual
report for the Trust on Form N-SAR and all required notices pursuant
to Rule 24f-2;
(s) review, and file with the National Association of
Securities Dealers where necessary, marketing materials relating to
the Trust; and
(t) assist in the training and oversight of third
parties used to perform any of the services described herein.
Xxxxxx Management shall also be available, at its expense, to
perform internal audit examinations no more frequently that once annually at
the request of the Trust. In addition, Xxxxxx Management will perform or
oversee other services for the Trust as agreed from time to time, including,
but not limited to mailing the annual and semi-annual reports to
shareholders of the Portfolios; preparing an annual list of shareholders;
and mailing notices of shareholders' meetings, proxies and proxy statements,
for all of which the Trust will pay Xxxxxx Management's out-of-pocket
expenses.
In the performance of its duties hereunder, Xxxxxx Management will
comply with the provisions of the Declaration of Trust and the Bylaws of the
Trust, will safeguard and promote the welfare of the Trust, and will comply
with the policies that the Trustees may from time to time reasonably
determine; provided that such policies are not in conflict with this
Agreement, the Trust's governing documents, or any applicable statutes or
regulations.
3. Allocation of Charges and Expenses.
(A) Xxxxxx Management. Xxxxxx Management shall furnish at its
own expense the executive, supervisory and clerical personnel necessary to
perform its obligations under this Agreement. Xxxxxx Management 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 Trust as well as all
Trustees of the Trust who are affiliated persons of Xxxxxx Management or any
affiliated corporation of Xxxxxx Management; provided, however, that unless
otherwise specifically provided, Xxxxxx Management shall not be obligated to
pay the compensation of any employee of the Trust retained by the Trustees
of the Trust to perform services on behalf of the Trust.
(B) The Trust. The Trust assumes and shall pay or cause to be
paid all other expenses of the Trust not otherwise allocated herein,
including, without limitation, organizational 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 Trustees who are not affiliated persons of Xxxxxx
Management or the investment adviser to the Trust or any affiliated
corporation of Xxxxxx Management or the Investment Adviser, the costs of
Trustees' meetings, insurance, interest, brokerage costs, litigation and
other extraordinary or nonrecurring expenses, and all fees and charges of
investment advisers to the Trust.
4. Compensation of Xxxxxx Management.
(a) Administration Fee. For the services to be rendered, the
facilities furnished and the expenses assumed by Xxxxxx Management pursuant
to this Agreement, the Trust shall pay to Xxxxxx Management compensation at
an annual rate calculated daily and paid monthly equal to 0.20% of each
Portfolio's average daily net assets. If this Agreement becomes effective
subsequent to the first day of a month or terminates before the last day of
a month, Xxxxxx Management'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 Xxxxxx
Management's compensation for the preceding month shall be made promptly.
(b) Compensation from Transactions. The Trust hereby authorizes
any entity or person associated with Xxxxxx Management which is a member of
a national securities exchange to effect any transaction on the exchange for
the account of the Trust which is permitted by Section 11(a) of the
Securities Exchange Act of 1934 and Rule 11a2-2(T) thereunder, and the Trust
hereby consents to the retention of compensation for such transactions in
accordance with Rule 11a2-2(T) (a) (2) (iv).
(c) Survival of Compensation Rates. All rights of compensation
under this Agreement for services performed as of the termination date shall
survive the termination of this Agreement.
5. Activities of Xxxxxx Management. The services of Xxxxxx
Management rendered to the Trust are not to be deemed to be exclusive.
Xxxxxx Management is free to render such services to others and to have
other businesses and interests. It is understood that Trustees, officers,
employees and Shareholders of the Trust are or may be or become interested
in Xxxxxx Management, as directors, officers, employees and shareholders or
otherwise and that directors, officers, employees and shareholders of Xxxxxx
Management and its counsel are or may be or become similarly interested in
the Trust, and that Xxxxxx Management may be or become interested in the
Trust as a Shareholder or otherwise.
6. Confidentiality. Xxxxxx Management agrees on behalf of
itself and its employees to treat confidentially all records and other
information relative to the Trust and its prior, present or potential
Shareholders and relative to Xxxxxx Management and its prior, present or
potential customers, except, after prior notification to and approval in
writing by the Trust, which approval shall not be unreasonably withheld and
may not be withheld where Xxxxxx Management 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 Trust.
7. Representations, Warranties and Covenants.
(a) In the event of equipment failures beyond Xxxxxx
Management's control, Xxxxxx Management shall, at no additional expense to
the Trust, take reasonable steps to minimize service interruptions but shall
have no liability with respect to such service interruptions if such
reasonable steps are taken. Xxxxxx Management shall develop and maintain a
plan for recovery from equipment failures which may include contractual
arrangements with appropriate parties making reasonable provision for
emergency use of electronic data processing equipment to the extent
appropriate equipment is available.
(b) Xxxxxx Management undertakes to comply with all applicable
requirements of the 1933 Act, the 1934 Act, the 1940 Act and any laws, rules
and regulations of governmental authorities having jurisdiction with respect
to the duties to be performed by Xxxxxx Management hereunder.
(c) Xxxxxx Management warrants that all software code owned by
or under its control, used in the performance of its obligations under this
contract, will be Year 2000 compliant. For purposes of this paragraph,
"Year 2000 Compliant" means that the software will continue to operate
beyond December 31, 1999, without creating any logical or mathematical
inconsistencies concerning any date after December 31, 1999, and without
decreasing the functionality of the system applicable to dates prior to
January 1, 2000, including, but not limited to, making changes to (a) date
and data century recognition; (b) calculations which accommodate same-
century and multi-century formulas and date values; and (c) input/output of
date values which reflect century dates. All changes described in this
paragraph will be made at no additional cost to the Fund.
8. Term; Termination. This Agreement shall become effective
with respect to the Fund on the date hereof and shall remain in full force
until April 1, 2000, unless sooner terminated as hereinafter provided. This
Agreement shall continue in force from year to year thereafter with respect
to the Fund, but only as long as such continuance is specifically approved
for the Fund at least annually in the manner required by the 1940 Act and
the rules and regulations thereunder; provided, however, that if the
continuation of this Agreement is not approved for the Fund, Xxxxxx
Management may continue to serve in such capacity for the Fund in the manner
and to the extent permitted by the 1940 Act and the rules and regulations
thereunder.
This Agreement shall automatically terminate in the event of its
assignment by the Xxxxxx Management, and may be terminated by the Board of
Trustees of the Trust, by vote of a majority of the outstanding voting
securities of the Trust, or by Xxxxxx Management, at any time without cause
and without the payment of any penalty on sixty (60) days' written notice by
one party to the other party. This Agreement may also be terminated
immediately, upon delivery of notice of termination and without the payment
of any penalty, by the Trust in the event that the Board of Trustees
determines that Cause for termination exists. The term "Cause" shall
include, without limitation, (i) a material breach of this Agreement or
other action or omission by Xxxxxx Management which has or is likely to have
a material and imminent adverse effect on the Fund or its shareholders, (ii)
any other breach of this Agreement by Xxxxxx Management which is not cured
within twenty (20) business days after written notice of such breach from
the Board, (iii) the insolvency or the filing of bankruptcy or
reorganization proceedings by or against Xxxxxx Management, or (iv) the
conviction of Xxxxxx Management or any director or executive officer of
Xxxxxx Management of a felony. The terms "assignment" and "majority of the
outstanding voting securities" have the meanings set forth in the 1940 Act
and the rules and regulations thereunder. Termination of this Agreement
shall not affect the right of Xxxxxx Management to receive payments on any
unpaid balance of the compensation described in Section 4 earned prior to
the effective date of such termination.
9. Amendments. This Agreement or any part hereof may be
changed or waived only by an instrument in writing signed by the party
against which enforcement of such change or waiver is sought.
10. Certain Records. Xxxxxx Management shall maintain customary
records in connection with its duties as specified in this Agreement. 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 Xxxxxx
Management on behalf of the Trust shall be prepared and maintained at the
expense of Xxxxxx Management, but shall be the property of the Trust and
will be made available to or surrendered promptly to the Trust on request.
In case of any request or demand for the inspection of such records by
another party, Xxxxxx Management shall notify the Trust and follow the
Trust's instructions as to permitting or refusing such inspection.
11. Definitions of Certain Terms. The terms "interested person"
and "affiliated person," when used in this Agreement, shall have the
respective meanings specified in the 1940 Act and the rules and regulations
thereunder, subject to such exemptions as may be granted by the Securities
and Exchange Commission.
12. Notices. 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 last address furnished by the other party to the
party giving notice: if to the Trust, at 0000 Xxxxxxxxxx Xxxxxx, Xxxxx 000,
Xx. Xxxxx, Xxxxxxxx 00000; and if to Xxxxxx Management at 000 Xxxx Xxxx
Xxxx, Xxxxx 000, Xxxxxxxxx, Xxxxxxxx 00000.
13. Governing Law. This Agreement shall be construed in
accordance with the laws of the Commonwealth of Massachusetts and the
applicable provisions of the 1940 Act. To the extent that the applicable
laws of the Commonwealth of Massachusetts, or any of the provisions herein,
conflict with the applicable provisions of the 1940 Act, the latter shall
control.
14. Counterparts. 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.
15. Limitation of Trust Liability. The Declaration of Trust
establishing Xxxxxxx Investments, dated July 19, 1993, a copy of which,
together with all amendments thereto (the "Declaration"), is on file in the
office of the Secretary of the Commonwealth of Massachusetts, provides that
the name "Xxxxxxx Investments" refers to the Trustees under the Declaration
collectively as Trustees, but not as individuals or personally; and no
Trustee, shareholder, officer, employee or agent of Xxxxxxx Investments,
shall be held to any personal liability, nor shall result be had to their
private property for the satisfaction of any obligation or claim or
otherwise in connection with the affairs of said Xxxxxxx Investments, but
the Trust Estate only shall be liable.
IN WITNESS WHEREOF, the parties hereto have executed and delivered
this Agreement as of the day and year first above written.
XXXXXXX INVESTMENTS XXXXXX MANAGEMENT CORPORATION
By: /S/ XXXX X. XXXXXX By: /S/ XXXX X. XXXXXXXX
Title: President Title: Chairman
