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Exhibit (h)(1)
ADMINISTRATION AGREEMENT
AGREEMENT made as of October 12, 1999 by and between Commonfund
Institutional Funds, a Delaware business trust (the "Company"), and INVESTORS
BANK & TRUST COMPANY, a Massachusetts trust company (the "Bank").
WHEREAS, the Company, a registered investment company under the
Investment Company Act of 1940, as amended (the "1940 Act"), consisting of the
separate portfolios listed on Appendix A hereto; and
WHEREAS, the Company desires to retain the Bank to render certain
administrative services to the Company and the Bank is willing to render such
services.
NOW, THEREFORE, in consideration of the mutual covenants herein set
forth, it is agreed between the parties hereto as follows:
1. Appointment. The Company hereby appoints the Bank to act as
Administrator of the Company on the terms set forth in this Agreement. The Bank
accepts such appointment and agrees to render the services herein set forth for
the compensation herein provided.
2. Delivery of Documents. The Company has furnished the Bank with
copies properly certified or authenticated of each of the following:
(a) Resolutions of the Company's Board of Directors
authorizing the appointment of the Bank to provide certain administrative
services to the Company and approving this Agreement;
(b) The Company's Declaration of Trust and all amendments
thereto (the "Declaration");
(c) The Company's by-laws and all amendments thereto (the
"By-Laws");
(d) The Company's agreements with all service providers which
include any investment advisory agreements, sub-investment advisory agreements,
custody agreements, distribution agreements and transfer agency agreements
(collectively, the "Agreements");
(e) The Company's most recent Registration Statement on Form
N-1A (the "Registration Statement") under the Securities Act of 1933 and under
the 1940 Act and all amendments thereto; and
(f) The Company's most recent prospectus and statement of
additional information (the "Prospectus"); and
(g) Such other certificates, documents or opinions as may
mutually be deemed necessary or appropriate for the Bank in the proper
performance of its duties hereunder.
The Company will immediately furnish the Bank with copies of all
amendments of or supplements to the foregoing. Furthermore, the Company will
notify the Bank as soon as possible of any matter which may materially affect
the performance by the Bank of its services under this Agreement.
3. Duties of Administrator. Subject to the supervision and
direction of the Board of Directors of the Company, the Bank, as Administrator,
will assist in conducting various aspects of the Company's administrative
operations and undertakes to perform the services described in Appendix B
hereto. The Bank may, from time to time, perform additional duties and functions
which shall be set forth in an amendment to such Appendix B executed by both
parties. At such time, the fee schedule included in Appendix C hereto shall be
appropriately amended.
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In performing all services under this Agreement, the Bank shall act
in conformity with the Company's Declaration and By-Laws and the 1940 Act, as
the same may be amended from time to time, and the investment objectives,
investment policies and other practices and policies set forth in the Company's
Registration Statement, as the same may be amended from time to time.
Notwithstanding any item discussed herein, the Bank has no discretion over the
Company's assets or choice of investments and cannot be held liable for any
problem relating to such investments.
4. Duties of the Company.
(a) The Company is solely responsible (through its transfer agent or
otherwise) for (i) providing timely and accurate reports ("Daily Sales Reports")
which will enable the Bank as Administrator to monitor the total number of
shares sold in each state on a daily basis and (ii) identifying any exempt
transactions ("Exempt Transactions") which are to be excluded from the Daily
Sales Reports.
(b) The Company agrees to make its legal counsel available to the
Bank for instruction with respect to any matter of law arising in connection
with the Bank's duties hereunder, and the Company further agrees that the Bank
shall be entitled to rely on such instruction without further investigation on
the part of the Bank.
5. Fees and Expenses.
(a) For the services to be rendered and the facilities to be
furnished by the Bank, as provided for in this Agreement, the Company will
compensate the Bank in accordance with the fee schedule attached as Appendix C
hereto. Such fees do not include out-of-pocket disbursements (as delineated on
the fee schedule or other expenses with the prior approval of the Company's
management) of the Bank for which the Bank shall be entitled to xxxx the Company
separately and for which the Company shall reimburse the Bank.
(b) The Bank shall not be required to pay any expenses incurred by
the Company.
6. Limitation of Liability.
(a) Notwithstanding anything in this Agreement to the contrary, in
no event shall the Bank or any of its officers, directors,
employees or agents (collectively, the "Bank Indemnified
Parties") be liable to the Company, and the Company shall
indemnify and hold the Bank and the Bank Indemnified Parties
harmless from and against any and all loss, damage, liability,
actions, suits, claims, costs and expenses, including legal
fees, (a "Claim") arising as a result of any act or omission of
the Bank or any Bank Indemnified Party under this Agreement,
except for any Claim resulting from the negligence, willful
misfeasance or bad faith of the Bank or any Bank Indemnified
Party. Without limiting the foregoing, neither the Bank nor the
Bank Indemnified Parties shall be liable for, and the Bank and
the Bank Indemnified Parties shall be indemnified against, any
Claim arising as a result of : i) actions or omissions of the
Fund, including, but not limited to, inaccurate Daily Sales
Reports and misidentification of Exempt Transactions or; (ii)
the offer or sale of any securities of the Fund in violation of
(x) any requirement under the federal securities laws or
regulations, (y) any requirement under the securities laws or
regulations of any state, or (z) any stop order or other
determination or ruling by any federal or state agency with
respect to the offer or sale of such securities.
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(b) Notwithstanding anything in this Agreement to the contrary, in
no event shall the Company or any of its officers, directors, employees or
agents (collectively, the "Company Indemnified Parties") be liable to the Bank,
and the Bank shall indemnify and hold the Company and the Company Indemnified
Parties harmless from and against any and all claims arising as a result of any
act or omission of the Bank or any Bank Indemnified Party under this Agreement
that constitutes negligence, willful misfeasance or bad faith of the Bank or
such Bank Indemnified Party.
(c) Neither party shall be liable to the other for any loss, damage,
liability, action, suit, claim, cost or expense arising from any acts of God,
earthquakes, fires, floods, storms or other disturbances of nature, epidemics,
strikes, riots, nationalization, expropriation, currency restrictions, acts of
war, civil war or terrorism, insurrection, nuclear fusion, fission or radiation
other similar happenings or events that can not be controlled or contained by
such party. Neither party shall be liable to the other for any loss, damage,
liability, action, suit, claim, cost or expense arising from the interruption,
loss or malfunction of utilities or transportation or the unavailability of
energy sources except to the extent such interruption, loss or malfunction is
reasonably forseeable and subject to correction in a commercially reasonable
business continuity program.
(d) The Bank certifies that the occurrence in or use by the Bank's
own proprietary internal systems (the "Systems") of dates before or after
January 1, 2000 (the "Millennial Dates") will not adversely affect the
performance of the Systems with respect to date dependent data, computations,
output or other functions (including, without limitation, calculating, computing
and sequencing) and that the Systems will create, store and generate output data
related to or including Millennial Dates without errors or omissions ("Year 2000
Compliance").
The parties acknowledge that the Bank relies on automated data
communications with vendors, clients and other third parties, as well as certain
third party hardware and software providers such as Electronic Data Systems. The
Bank also relies on other third party relationships in the conduct of its
business. For example, the Bank relies on the services of the landlords of its
facilities, telecommunication companies, utilities and commercial airlines,
among others. The parties acknowledge that the Bank can make no certification as
to the Year 2000 Compliance of third-parties utilized by the Bank in its day to
day operations or with which the Systems interact or communicate, from which the
Systems receive data or to which the Systems send data. The parties further
acknowledge that while the Bank has contacted such third-parties regarding Year
2000 Compliance and will use reasonable efforts to monitor the status of such
third-parties' Year 2000 Compliance, failure by such third-parties to achieve
timely Year 2000 Compliance could adversely affect the Bank's performance.
(e) The Bank may apply to the Company at any time for instructions
and may consult counsel for the Company, or its own counsel, and with
accountants and other experts with respect to any matter arising in connection
with its duties hereunder, and the Bank shall not be liable or accountable for
any action taken or omitted by it in good faith in accordance with such
instruction, or with the opinion of such counsel, accountants, or other experts
so long as such action does not result from willful misfeasance, bad faith or
gross negligence by the Bank. The Bank shall not be liable for any act or
omission taken or not taken in reliance upon any document, certificate or
instrument which it reasonably believes to be genuine and to be signed or
presented by the proper person or persons. The Bank shall not be held to have
notice of any change of authority of any officers, employees, or agents of the
Company absent actual notice or until receipt of written notice thereof has been
received by the Bank from the Company.
(f) Notwithstanding anything to the contrary in this Agreement, in
no event shall the Bank be liable for special, incidental or consequential
damages, even if advised of the possibility of such damages.
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7. Termination of Agreement.
(a) The term of this Agreement shall be three years commencing upon
the date hereof (the "Initial Term"), unless earlier terminated as provided
herein. After the expiration of the Initial Term, the term of this Agreement
shall automatically renew for successive three-year terms (each a "Renewal
Term") unless notice of non-renewal is delivered by the non-renewing party to
the other party no later than ninety days prior to the expiration of the Initial
Term or any Renewal Term, as the case may be.
Either party hereto may terminate this Agreement prior to the
expiration of the Initial Term or any Renewal Term:
(i) in the event the other party violates any material provision
of this Agreement provided that the non-violating party gives
written notice of such violation to the violating party and
the violating party does not cure such violation within 90
days of receipt of such notice; and
(ii) if a majority of the Board of the Company reasonably
determines that the performance of the Bank under this
Agreement has been unsatisfactory, written notice (the
"Notice") of such determination setting forth the reasons for
such determination shall be provided to the Bank. In the event
the Bank shall not, within thirty (30) days thereafter, cure
identified deficiencies to the satisfaction of the Board, the
Company, with the authorization of the Board, may terminate
this Agreement.
(b) In the event of the termination of this Agreement, the Bank will
upon receipt or transmittal, as the case may be, of notice of termination,
continue nonetheless to discharge all of its obligations hereunder until
designation by the Company of a successor administrator and, upon appointment of
a successor administrator, shall commence and prosecute diligently to completion
the transfer of all functions performed by the Bank hereunder to successor or to
the Company or any other designee of the Company as the Company may direct. If
the Company does not select a successor administrator within ninety (90) days
from the date of delivery of notice of termination, the Bank may give the
Company a notice to quit. Sixty days thereafter the Bank shall be released from
any and all obligations under this Agreement.
(c) At any time after the termination of this Agreement, the Company
may, upon written request, have reasonable access to the records of the Bank
relating to its performance of its duties as Administrator.
8. Miscellaneous.
(a) Any notice or other instrument authorized or required by this
Agreement to be given in writing to the Company or the Bank shall be
sufficiently given if addressed to that party and received by it at its office
set forth below or at such other place as it may from time to time designate in
writing.
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To the Company:
Commonfund Institutional Funds
Attn: Treasurer
c/o Commonfund
000 Xxxx Xxxx Xxxx
Xxxxxxxx, XX 00000-0000
To the Bank:
Investors Bank & Trust Company
000 Xxxxxxxxx Xxxxxx, X.X. Xxx 0000
Xxxxxx, XX 00000-0000
Attention: Xxxxx Xxxx, Senior Director, Client Management
With a copy to: Xxxx X. Xxxxx, General Counsel
(b) This Agreement shall extend to and shall be binding upon the
parties hereto and their respective successors and assigns; provided, however,
that this Agreement shall not be assignable without the written consent of the
other party.
(c) This Agreement shall be construed in accordance with the laws of
the Commonwealth of Massachusetts, without regard to its conflict of laws
provisions.
(d) This Agreement may be executed in any number of counterparts
each of which shall be deemed to be an original and which collectively shall be
deemed to constitute only one instrument.
(e) The captions of 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.
9. Confidentiality. All books, records, information and data pertaining
to the business of the other party which are exchanged or received pursuant to
the negotiation or the carrying out of this Agreement shall remain confidential,
and shall not be voluntarily disclosed to any other person, except as may be
required in the performance of duties hereunder or as otherwise required by law.
10. Use of Name. The Company shall not use the name of the Bank or any
of its affiliates in any prospectus, sales literature or other material relating
to the Company in a manner not approved by the Bank prior thereto in writing;
provided however, that the approval of the Bank shall not be required for any
use of its name which merely refers in accurate and factual terms to its
appointment hereunder or which is required by the Securities and Exchange
Commission or any state securities authority or any other appropriate
regulatory, governmental or judicial authority; provided further, that in no
event shall such approval be unreasonably withheld or delayed.
11. Several Obligations of the Funds. This Agreement is an agreement
entered into between the Bank and the Company with respect to each Fund. With
respect to any obligation of the Company on behalf of any Fund arising out of
this Agreement, the Bank shall look for payment or satisfaction of such
obligation solely to the assets of the Fund to which such obligation relates as
though the Bank had separately contracted with the Company by separate written
instrument with respect to each Fund.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be duly executed and delivered by their duly authorized officers as of the date
first written above.
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COMMONFUND INSTITUTIONAL FUNDS
By: /s/ Xxxxxx X. Xxxx
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Name: Xxxxxx X. Xxxx
Title: Vice President and Treasurer
INVESTORS BANK & TRUST COMPANY
By: /s/ Xxxxxx X. Xxxxxxx
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Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice President
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Appendices
Appendix A...................................... Funds
Appendix B...................................... Services
Appendix C...................................... Fee Schedule
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Appendix A
Funds
Commonfund Short Duration Fund
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Appendix B
Services
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Appendix C
Fee Schedule
The Company shall pay the Bank a fee for services rendered to the Short Duration
Fund accrued daily and paid monthly at the following annual rates using a 365
day year:
NET ASSETS IN FUNDS OF THE COMPANY ANNUAL RATE
$10 billion or less 0.05%
Over $10 billion 0.0025%
Legal expenses, printing, delivery, postage and travel associated with the
performance of services under this agreement will be for the account of the
Company.
Amounts payable hereunder will be invoiced by Custodian and, after
approval of the Treasurer, charged against the Custodian Account. Payment is due
within five (5) days.
