ADMINISTRATION AGREEMENT
ADMINISTRATION AGREEMENT made , 2000, by and between The Rightime
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Fund, Inc., a Maryland corporation (the "Corporation") for The Rightime OTC
Plus Fund Series (the "Fund"), and Rightime Administrators, Inc., a
Pennsylvania corporation (the "Administrator").
BACKGROUND
The Corporation is a diversified open-end management investment company
registered under the Investment Company Act of 1940, as amended (the "1940
Act"). The Fund is a series of the Corporation and has been organized for
the purpose of investing its funds in securities and has retained an
investment advisor for this purpose. The Fund desires to avail itself of the
facilities available to the Administrator with respect to the administration
of its day-to-day affairs, and the Administrator is willing to furnish such
administrative services on the terms and conditions hereinafter set forth.
NOW, THEREFORE, the parties hereto, intending to be legally bound, hereby
agree as follows:
1. The Corporation, on behalf of the Fund, hereby appoints the Administrator
to administer the Fund's affairs, subject to the overall supervision of the
Board of Directors of the Corporation, for the period and on the terms set
forth in this Agreement. The Administrator hereby accepts such appointment
and agrees during such period to render the services herein described and to
assume the obligations set forth herein, for the compensation herein
provided.
2. Subject to the supervision of the Board of Directors of the Corporation,
the Administrator shall administer the Fund's affairs and, in connection
therewith, shall furnish the Fund with office facilities, and shall be
responsible for (i) maintaining the Fund's books and records (other than
financial or accounting books and records or those being mentioned by the
Fund's custodian, transfer agent, distributor, or accounting services
agents); (ii) overseeing the Fund's insurance relationships; (iii) preparing
for the Fund (or assisting counsel and/or auditors in the preparation of)
all required tax returns, proxy statements and reports to the Fund's
shareholders and Directors and reports to and other filings with the
Securities and Exchange Commission and any other governmental agency (the
Corporation agreeing to supply or to cause to be supplied to the
Administrator any necessary financial and other information in connection
with the foregoing); (iv) preparing such applications and reports as may be
necessary to register or maintain the Corporation's registration and/or the
registration of the Fund's shares under the securities or "blue-sky" laws of
the various states (the Corporation agreeing to pay all filing fees or other
similar fees in connection therewith); (v) responding to all inquiries or
other communications of shareholders and broker-dealers, if any, which are
directed to the Administrator, or, if any such inquiry or communication is
more properly to be responded to by the Fund's transfer agent, custodian,
distributor, or accounting services agents, overseeing their response
thereto; (vi) overseeing all relationships between the Fund and its
custodian, transfer agent, distributor, and accounting services agents,
including the negotiation of agreements in relation thereto and the
supervision of the performance of such agreements; and (vii) authorizing and
directing any of the Administrator's directors, officers and employees who
may be elected as directors or officers of the Corporation to serve in the
capacities in which they are elected. All services to be furnished by the
Administrator under this Agreement may be furnished through the medium of
any such directors, officers or employees of the Administrator. The
Corporation authorizes the Administrator to appoint and contract with other
parties to perform certain of the services to be furnished by the
Administrator under this Agreement, subject to ratification by the officers
of the Corporation and any such contract shall be countersigned by the
Corporation to confirm such ratification. The Corporation represents that it
will cooperate with the Administrator and any other parties retained by the
Administrator under this Agreement in the performance of services to be
rendered by the Administrator or any other parties retained by the
Administrator. The Corporation further represents that it will indemnify and
hold the Administrator harmless from and against any loss, liability and
expense, including any legal expenses arising from failure of the
Corporation to so cooperate with the Administrator and other parties
retained by the Administrator to perform services under this Agreement, or
arising from any error, omission, inaccuracy or other deficiency in
information provided by the Corporation, or the failure of the Corporation
to provide any portion of such or any information needed by the
Administrator or any parties retained by the Administrator to perform the
services to be rendered under this Agreement.
In connection with the services rendered by the Administrator under this
Agreement, the Administrator will bear all of the following expenses:
(i) The salaries and expenses of all personnel of the Corporation, in
connection with their service to the Fund, and the Administrator, except the
fees of directors who are not affiliated persons of the Administrator or the
Fund's investment advisor.
(ii) All expenses incurred by the Administrator or by the Fund in connection
with administering the ordinary course of the Fund's business other than
those assumed by the Corporation, on behalf of the Fund, herein.
(iii) The fees of any party with whom the Administrator may contract to
perform certain of the services to be furnished by the Administrator under
this Agreement.
The Corporation, on behalf of the Fund, assumes and will pay the expenses
described below:
(a) The fees and expenses of any investment advisor or expenses otherwise
incurred by the Fund in connection with the management of the investment and
reinvestment of the Fund's assets;
(b) The fees and expenses of the distributor;
(c) The fees and expenses of directors who are not affiliated persons of the
Administrator, the investment advisor or the distributor;
(d) The fees and expenses of the custodian, which relate to (i) the
custodial function and the recordkeeping connected therewith, (ii) the
maintenance of the required accounting records of the Fund not being
maintained by the Administrator, (iii) the pricing of the shares of the
Fund, including the cost of any pricing service or services which may be
retained pursuant to the authorization of the Board of Directors of the
Corporation, and (iv) for both mail and wire orders, the cashiering function
in connection with the issuance and redemption of the Fund's securities and
(v) all other expenses related to the performance of duties by the custodian
for the Fund;
(e) The fees and expenses of the Fund's transfer and dividend disbursing
agent, who may be the custodian, which relate to the maintenance of each
shareholder account;
(f) The charges and expenses of legal counsel and independent accountants
for the Fund;
(g) Brokers' commissions and any issue or transfer taxes chargeable to the
Fund in connection with its securities transactions;
(h) All taxes and corporate fees payable by the Fund to federal, state or
other governmental agencies;
(i) The Fund's proper proportionate share of the fees of any trade
association of which the Corporation may be a member;
(j) The cost of stock certificates representing and non-negotiable share
deposit receipts evidencing shares of the Fund, if any;
(k) The Fund's proper proportionate share of the fees and expenses involved
in registering and maintaining registrations of the Corporation and the
shares of the Fund with the Securities and Exchange Commission, registering
the Fund as a broker-dealer and qualifying its shares for sale under state
securities laws, including the preparation and printing of the Corporation's
registration statements and prospectuses for filing under federal and state
securities laws for such purposes;
(l) Allocable communications expenses with respect to investor services and
all expenses of shareholders, and directors, meetings and of preparing,
printing and mailing prospectuses and reports to shareholders in the amount
necessary for distribution to the shareholders; and
(m) Litigation and indemnification expenses and other extraordinary expenses
not incurred in the ordinary course of the Fund's business.
3. The Administrator hereby agrees to pay the organization expenses of, and
the expenses incurred in connection with the initial offering or
distribution of shares by, the Fund, except that the Fund shall reimburse
the Administrator for such organization expenses, amortized and paid over 60
months, commencing from the date the Fund becomes effective.
4. As full compensation for the services performed and the facilities
furnished by the Administrator, the Corporation, on behalf of the Fund,
shall pay the Administrator a fee based on the rates stated in Schedule A of
this Agreement. This fee will be computed daily and shall be payable twice
monthly according to such schedule as is set forth from time to time by the
parties to this Agreement and approved by the Board of Directors of the
Corporation. This fee shall be prorated for any fraction of a month at the
commencement or termination of this Agreement.
In the event the expenses of the Fund for any fiscal year (including the
fees payable to the Administrator and the Fund's investment advisor, but
excluding interest, taxes, brokerage commission, distribution fees,
litigation and indemnification expenses and other extraordinary expenses not
incurred in the ordinary course of the Fund's business) exceed the limits
set by applicable regulation of state securities commissions, if any, the
compensation payable to the Administrator will be reduced by eighty percent
(80%) of the amount of such excess. If for any month such expenses exceed
such limitation after giving effect to the above reduction of the fees
payable to the Administrator and the Fund's investment advisor, the payment
to the Administrator for that month will be reduced or postponed so that at
no time will there be any accrued but unpaid liability under this expense
limitation. Any such reductions or payments are subject to readjustment
during the year, and the Administrator's obligation hereunder will be
limited to the amount of its fee paid or accrued with respect to such fiscal
year.
5. The Administrator assumes no responsibility under this Agreement other
than to render the services called for hereunder, and specifically assumes
no responsibilities for investment advice or the investment or reinvestment
of the Fund's assets or the sale of its shares.
6. The Administrator shall not be liable for any error of judgment or
mistake of law for any loss suffered by the Fund in connection with the
matters to which this Agreement relates, whether incurred by the
Administrator or by any other parties retained by the Administrator to
perform services under this Agreement, except a loss resulting from willful
misfeasance, bad faith or gross negligence on the Administrator's part in
the performance of its duties or from reckless disregard by the
Administrator of its obligations and duties under this Agreement. The
Corporation agrees to indemnify and hold the Administrator harmless from any
and all loss, liability, and expense, including any legal expenses, arising
out of the Administrator's performance, or status, or any act or omission of
the Administrator, or that of any party retained by the Administrator to
perform services under this Agreement, unless such loss, liability, or
expense is due to the willful misfeasance, bad faith or gross negligence of
the Administrator. The Corporation further agrees to indemnify and hold any
party retained by the Administrator to perform services under this Agreement
harmless from any and all loss, liability, and expense, including any legal
expenses arising out of such party's performance, or status, or any act or
omission of such party, unless such loss, liability or expense is due to the
willful misfeasance, bad faith or gross negligence of such party. Any person
employed by the Administrator, who may be or become an employee of and paid
by any other entity affiliated with the Fund, such as the investment
advisor, distributor, or custodian for the Fund, shall be deemed, when
acting within the scope of his employment by such other affiliated entity,
to be acting in such employment solely for such other affiliated entity and
not as the Administrator's employee or agent.
7. This Agreement shall continue in effect for a period of more than two (2)
years from the date hereof only so long as such continuance is specifically
approved at least annually by the Board of Directors of the Corporation
provided, however, that this Agreement may be terminated by the Corporation
at any time, without the payment of any penalty, by the Board of Directors
of the Corporation or by vote of a majority of the outstanding voting
securities (as defined in the 0000 Xxx) of the Fund, or by the Administrator
at any time, without the payment of any penalty, on not more than sixty (60)
days' nor less than thirty (30) days' written notice to the other party.
This Agreement shall terminate automatically in the event of its assignment
(as defined in the 1940 Act).
8. Nothing in this Agreement shall limit or restrict the right of any
director, officer or employee of the Administrator who may also be a
director, officer or employee of the Corporation to engage in any other
business or to devote his time and attention in part to the management or
other aspects of any business, whether of a similar or a dissimilar nature,
nor limit or restrict the right of the Administrator to engage in any other
business or to render services of any kind to any other corporation, firm,
individual or association.
9. During the term of this Agreement, the Corporation agrees to furnish the
Administrator at its principal office all prospectuses, proxy statements,
reports to shareholders, sales literature, or other material provided for
distribution to stockholders of the Fund or the public, which refer in any
way to the Administrator, prior to use thereof, and not to use such material
if the Administrator reasonably objects in writing within five (5) business
days (or such other time as may be mutually agreed upon) after receipt
thereof. In the event of termination of this Agreement, the Corporation will
continue to furnish to the Administrator copies of any of the above
mentioned materials which refer in any way to the Administrator. The
Corporation shall furnish or otherwise make available to the Administrator
such other information relating to the business affairs of the Fund as the
Administrator at any time, or from time to time, reasonably requests in
order to discharge its obligations hereunder.
10. This Agreement may be amended by mutual written consent.
11. This Agreement shall be governed by and construed in accordance with the
laws of the Commonwealth of Pennsylvania.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed by their officers designated below as of the day and year first
above written.
THE RIGHTIME FUND, INC.
By: --------------------------
Xxxxx X. Rights
President
[Corporate Seal] Attest: --------------------------
Xxxxxx X. Xxxxx, Xx.
Secretary
RIGHTIME ADMINISTRATORS, INC.
By: --------------------------
Xxxxx X. Rights
President
[Corporate Seal] Attest: --------------------------
Xxxxxx X. Xxxxx, Xx.
Secretary
SCHEDULE A
ADMINISTRATION AGREEMENT
Attached to and part of the Administration Agreement dated , 2000
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between The Rightime Fund, Inc. (the "Corporation") for The Rightime OTC
Plus Fund (the "Fund") and Rightime Administrators, Inc. (the
"Administrator").
CURRENT FEE SCHEDULE
I. Class A Shares
* The Corporation, on behalf of the Fund, shall pay the Administrator a fee
at the annualized rate of 0.85 of one percent (0.85%) of the first five-
hundred million dollars of the Fund's Class A Shares average daily net
assets and 0.80 of one percent (0.80%) of the Fund's Class A Shares average
daily net assets in excess of five-hundred million dollars.
II. Class C Shares
* The Corporation, on behalf of the Fund, shall pay the Administrator a fee
at the annualized rate of 0.70 of one percent (0.70%) of the first five-
hundred million dollars of the Fund's Class C Shares average daily net
assets and 0.65 of one percent (0.65%) of the Fund's Class C Shares average
daily net assets in excess of five-hundred million dollars.
