ADVISOR'S FUND
ADMINISTRATIVE SERVICES AND
TRANSFER AGENCY AGREEMENT
This Agreement is made as of this ____ day of __________, 1998, by and between
the Advisor's Fund, a Kansas corporation ("Fund"), and Security Management
Company, LLC, a Kansas limited liability company ("SMC, LLC"), located in
Topeka, Kansas.
WHEREAS, the Fund is engaged in business as an open-end management investment
company registered under the Investment Company Act of 1940 (the "1940 Act") ;
and
WHEREAS, Security Management Company, LLC is willing to provide general
administrative, fund accounting, transfer agency, and dividend disbursing
services to PCG Aggressive Growth Series, PCG Growth Series, SIM Growth Series
and SIM Conservative Growth Series (the "Series") of the Fund under the terms
and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the premises and mutual agreements made
herein, the parties agree as follows:
1. Employment of Security Management Company, LLC
SMC, LLC will provide the Series with general administrative, fund
accounting, transfer agency, and dividend disbursing services described
and set forth in Schedule A attached hereto and made a part of this
Agreement by reference. SMC, LLC agrees to maintain sufficient trained
personnel, equipment and supplies to perform such services in
conformity with the current prospectus of the Series and such other
reasonable standards of performance as the Fund may from time to time
specify, and otherwise in an accurate, timely and efficient manner.
2. Compensation
As consideration for the services described in Section A, the Fund
agrees to pay SMC, LLC a fee as described and set forth in Schedule B
attached hereto and made a part of this Agreement by reference, as it
may be amended from time to time, such fee to be calculated and accrued
daily and payable monthly.
3. Expenses
A. Expenses of SMC, LLC. SMC, LLC shall pay all of the expenses
incurred in providing the Series the services and facilities
described in this agreement, whether or not such expenses are
billed to SMC, LLC or the Fund, except as otherwise provided
herein.
B. Expenses of Series. Expenses to be incurred in the operation of
the Series shall be borne by the Series, except as provided by
Section 3.A. Expenses to be borne by the Series include, but are
not limited to, taxes; interest; brokerage fees and commissions,
if any; fees of directors who are not "interested persons" of the
Fund as that term is defined in the 1940 Act; Securities and
Exchange Commission ("SEC") fees and state Blue Sky qualification
fees; advisory and administration fees; charges of custodians,
transfer and dividend disbursing agents; insurance premiums;
outside auditing and legal expenses; costs of maintenance of
"corporate existence"; costs of preparation and transmission of
registration statements and other SEC filings; typesetting and
printing of prospectuses for regulatory purposes and for
distribution to shareholders of the Fund; costs of shareholders'
reports and corporate meetings; and any extraordinary expenses.
4. Insurance
The Fund and SMC, LLC agree to procure and maintain, separately or as
joint insureds with themselves, their directors, employees, agents and
others, and other investment companies for which SMC, LLC acts as
investment advisor and transfer agent, a policy or policies of
insurance against loss arising from breaches of trust, errors and
omissions, and a fidelity bond meeting the requirements of the 1940
Act, in the amounts and with such deductibles as may be agreed upon
from time to time, and to pay such portions of the premiums therefor as
amount of the coverage attributable to each party is to the aggregate
amount of the coverage for all parties or, with respect to the errors
and omissions coverage, on the basis of the respective insureds' net
assets or other reasonable basis.
5. Registration and Compliance
A. SMC, LLC represents that as of the date of this agreement it is
registered as a transfer agent with the Securities and Exchange
Commission ("SEC") pursuant to Subsection 17A of the Securities
Exchange Act of 1934 and the rules and regulations thereunder,
and agrees to maintain said registration and comply with all of
the requirements of said Act, rules and regulations so long as
this Agreement remains in force.
B. The Fund represents that it is a diversified management
investment company registered with the SEC in accordance with
the 1940 Act and the rules and regulations thereunder, and
authorized to sell its shares pursuant to the 1940 Act, the
Securities Act of 1933 and the rules and regulations thereunder.
6. Liability and Indemnification
SMC, LLC shall be liable for any actual losses, claims, damages or
expenses (including any reasonable counsel fees and expenses) resulting
from SMC, LLC's bad faith, willful misfeasance, reckless disregard of
its obligations and duties, negligence or failure to properly perform
any of its responsibilities or duties under this Agreement. SMC, LLC
shall not be liable and shall be indemnified and held harmless by the
Fund, for any claim, demand or action brought against it arising out
of, or in connection with:
A. Bad faith, willful misfeasance, reckless disregard of its duties
or negligence of the Board of Directors of the Fund, or SMC,
LLC's acting upon any instructions properly executed and
authorized by the Board of Directors of the Fund;
B. SMC, LLC acting in reliance upon advice given by independent
counsel retained by the Board of Directors of the Fund.
In the event that SMC, LLC requests the Fund to indemnify or hold it
harmless hereunder, SMC, LLC shall use its best efforts to inform the
Fund of the relevant facts concerning the matter in question. SMC, LLC
shall use reasonable care to identify and promptly notify the Fund
concerning any matter which presents, or appears likely to present, a
claim for indemnification against the Fund.
The Fund shall have the election of defending SMC, LLC against any
claim which may be the subject of indemnification hereunder. In the
event the Fund so elects, it will so notify SMC, LLC and thereupon the
Fund shall take over defenses of the claim, and if so requested by the
Fund, SMC, LLC shall incur no further legal or other claims related
thereto for which it would be entitled to indemnity hereunder provided,
however, that nothing herein contained shall prevent SMC, LLC from
retaining, at its own expense, counsel to defend any claim. Except with
the Fund's prior consent, SMC, LLC shall in no event confess any claim
or make any compromise in any matter in which the Fund will be asked to
indemnify or hold SMC, LLC harmless hereunder.
Punitive Damages. SMC, LLC shall not be liable to the Fund, or
any third party, for punitive, exemplary, indirect, special or
consequential damages (even if SMC, LLC has been advised of the
possibility of such damages) arising from its obligations and
the services provided under this agreement, including but not
limited to loss of profits, loss of use of the shareholder
accounting system, cost of capital and expenses of substitute
facilities, programs or services.
Force Majeure. Anything in this Agreement to the contrary
notwithstanding, SMC, LLC shall not be liable for delays or
errors occurring by reason of circumstances beyond its control,
including but not limited to acts of civil or military
authority, national emergencies, work stoppages, fire, flood,
catastrophe, earthquake, acts of God, insurrection, war, riot,
failure of communication or interruption.
7. Delegation of Duties
SMC, LLC may, at its discretion, delegate, assign or subcontract any of
the duties, responsibilities and services governed by this Agreement to
its affiliate, Security Benefit Group, Inc., whether or not by formal
written agreement, or to any third party, provided that such
arrangement with a third party has been approved by the Board of
Directors of the Fund. SMC, LLC shall, however, retain ultimate
responsibility to the Fund, and shall implement such reasonable
procedures as may be necessary, for assuring that any duties,
responsibilities or services so assigned, subcontracted or delegated
are performed in conformity with the terms and conditions of this
Agreement.
8. Amendment
This Agreement and the schedules forming a part hereof may be amended
at any time, without shareholder approval, by a writing signed by each
of the parties hereto. Any change in the Fund's registration statements
or other documents of compliance or in the forms relating to any plan,
program or service offered by its current prospectus which would
require a change in SMC, LLC's obligations hereunder shall be subject
to SMC, LLC's approval, which shall not be unreasonably withheld.
9. Termination
This Agreement may be terminated by either party without cause upon 120
days' written notice to the other, and at any time for cause in the
event that such cause remains unremedied for more than 30 days after
receipt by the other party of written specification of such cause.
In the event the Fund designates a successor to any of SMC, LLC's
obligations hereunder, SMC, LLC shall, at the expense and pursuant to
the direction of the Fund, transfer to such successor all relevant
books, records and other data of the Fund in the possession or under
the control of SMC, LLC.
10. Severability
If any clause or provision of this Agreement is determined to be
illegal, invalid or unenforceable under present or future laws
effective during the term hereof, then such clause or provision shall
be considered severed herefrom and the remainder of this Agreement
shall continue in full force and effect.
11. Term
This Agreement initially shall become effective upon its approval by a
majority vote of the Board of Directors of the Fund, including a
majority vote of the Directors who are not "interested persons" of the
Fund or SMC, LLC, as defined in the 1940 Act, and shall continue until
terminated pursuant to its provisions.
12. Applicable Law
This Agreement shall be subject to and construed in accordance with the
laws of the State of Kansas.
SECURITY MANAGEMENT COMPANY, LLC
--------------------------------
By: Xxxxx X. Xxxxxxx, President
ATTEST:
---------------------------
Xxx X. Xxx, Secretary
ADVISOR'S FUND
--------------------------------
By: Xxxx X. Xxxxxxx, President
ATTEST:
---------------------------
Xxx X. Xxx, Secretary
ADVISOR'S FUND
ADMINISTRATIVE SERVICES AND
TRANSFER AGENCY AGREEMENT
SCHEDULE A
Security Management Company, LLC agrees to provide the Series the following
Administrative facilities and services:
1. Fund and Portfolio Accounting
A. Maintenance of Fund General Ledger and Journal.
B. Preparing and recording disbursements for direct series expenses.
C. Preparing daily money transfers.
D. Reconciliation of all Series bank and custodian accounts.
E. Assisting Fund independent auditors as appropriate.
F. Prepare daily projection of available cash balances.
G. Record trading activity for purposes of determining net asset values
and daily dividend.
H. Prepare daily portfolio evaluation report to value portfolio
securities and determine daily accrued income.
I. Determine the daily net asset value per share.
J. Determine the daily, monthly, quarterly, semiannual or annual dividend
per share.
K. Prepare monthly, quarterly, semiannual and annual financial
statements.
L. Provide financial information for reports to the Securities and
Exchange Commission in compliance with the provisions of the 1940 Act
and the Securities Act of 1933, the Internal Revenue Service and other
regulatory agencies as required.
M. Provide financial, yield, net asset value, etc. information to NASD
and other survey and statistical agencies as instructed by the Fund.
N. Report to the Audit Committee of the Board of Directors, if
applicable.
2. Administrative
A. Provide registration and other administrative services necessary to
qualify the shares of the Series for sale in those jurisdictions
determined from time to time by the Fund's Board of Directors
(commonly known as "Blue Sky Registration").
B. Provide registration with and reports to the Securities and Exchange
Commission in compliance with the provisions of the 1940 Act and the
Securities Act of 1933.
C. Prepare and review Series prospectus and Statement of Additional
Information.
D. Prepare proxy statements and oversee proxy tabulation for annual
meetings.
E. Prepare Board materials and maintain minutes of Board meetings.
F. Draft, review and maintain contractual agreements between Fund and
Investment Advisor, Custodian, Distributor and Transfer Agent.
G. Oversee printing of proxy statements, financial reports to
shareholders, prospectuses and Statements of Additional Information.
H. Provide oversight regarding shareholder transactions, administrative
services, compliance with contractual agreements and the provisions of
the 1940 Act and the Securities Act of 1933.
SCHEDULE OF SHARE TRANSFER AND DIVIDEND DISBURSING SERVICES
Security Management Company, LLC agrees to provide the Series the following
transfer agency and dividend disbursing services:
1. Maintenance of shareholder accounts, including processing of new accounts.
2. Posting address changes and other file maintenance for shareholder
accounts.
3. Posting all transactions to the shareholder file, including:
A. Direct purchases
B. Wire order purchases
C. Direct redemptions
D. Wire order redemptions
E. Draft redemptions
F. Direct exchanges
G. Transfers
H. Certificate issuances
I. Certificate deposits
4. Monitor fiduciary processing, insuring accuracy and deduction of fees.
5. Prepare daily reconciliations of shareholder processing to money movement
instructions.
6. Handle bad/returned check collections. Immediately liquidate shares
purchased and return to the shareholder the check and confirmation of the
transaction.
7. Issuing all checks and stopping and replacing lost checks.
8. Draft clearing services.
A. Maintenance of signature cards and appropriate corporate resolutions.
B. Comparison of the signature on the check to the signatures on the
signature card for the purpose of paying the face amount of the check
only.
C. Receiving checks presented for payment and liquidating shares after
verifying account balance.
D. Ordering checks in quantity specified by the Series for the
shareholder, if applicable.
9. Mailing confirmations, checks and/or certificates resulting from
transaction requests to shareholders.
10. Performing all of the Series' other mailings, including:
A. Dividend and capital gain distributions.
B. Semiannual and annual reports.
C. 1099/year-end shareholder reporting.
D. Systematic withdrawal plan payments.
E. Daily confirmations.
11. Answering all service related telephone inquiries from shareholders and
others, including:
A. General and policy inquiries (research and resolve problems).
B. Fund yield inquiries.
C. Taking shareholder processing requests and account maintenance changes
by telephone as described above.
D. Submit pending requests to correspondence.
E. Monitor on-line statistical performance of unit.
F. Develop reports on telephone activity.
12. Respond to written inquiries (research and resolve problems), including:
A. Initiate shareholder account reconciliation proceeding when
appropriate.
B. Notify shareholder of bad/returned investment checks.
C. Respond to financial institutions regarding verification of deposit.
D. Initiate proceedings regarding lost certificates.
E. Respond to complaints and log activities.
F. Correspondence control.
13. Maintaining and retrieving all required past history for shareholders and
provide research capabilities as follows:
A. Daily monitoring of all processing activity to verify back-up
documentation.
B. Provide exception reports.
C. Microfilming.
D. Storage, retrieval and archive.
14. Prepare materials for annual meetings.
A. Address and mail annual proxy and related material.
B. Prepare and submit to Fund and affidavit of mailing.
C. Furnish certified list of shareholders (hard copy or microfilm) and
inspectors of election.
15. Report and remit as necessary for state escheat requirements.
ADVISOR'S FUND
ADMINISTRATIVE SERVICES AND TRANSFER AGENCY AGREEMENT
SCHEDULE B
The following charges apply to the Series:
Annual Maintenance Fee: $8.00 per account
Transaction Fee: $1.00
Dividend Fee: $1.00
Annual Accounting Fee: Per Series, the greater of $ 15,000 per
year or 0.03% (based on average daily
net asset values).
Annual Administration Fee: Per Series, 0.045% (based on average
daily net asset values)
If this Agreement shall terminate before the last day of a month, compensation
for that part of the month this Agreement is in effect shall be prorated in a
manner consistent with the calculation of the fees set forth above.
