ADMINISTRATION AGREEMENT
THIS AGREEMENT is made as of this 30th day of June, 2003, by and between
XXX XXXXX TRUST (the "Trust"), a Massachusetts business trust having its
principal place of business at 0000 Xxxxx Xxxxxxxxx, Xxxxxx, Xxxxx Xxxxxxxx
00000, and ULTIMUS FUND SOLUTIONS, LLC ("Ultimus"), a limited liability company
organized under the laws of the State of Ohio and having its principal place of
business at 000 Xxxxxxxx Xxxxxx, Xxxxx 000, Xxxxxxxxxx, Xxxx 00000.
WHEREAS, the Trust is an open-end management investment company registered
under the Investment Company Act of 1940, as amended (the "1940 Act"); and
WHEREAS, the Trust desires that Ultimus provide certain administrative
services for each series of the Trust, listed on Schedule A attached hereto and
made part of this Agreement, as such Schedule A may be amended from time to time
(individually referred to herein as the "Portfolio" and collectively as the
"Portfolios"); and
WHEREAS, Ultimus is willing to perform such services on the terms and
conditions set forth in this Agreement;
NOW, THEREFORE, in consideration of the mutual premises and covenants
herein set forth, the parties agree as follows:
1. RETENTION OF ULTIMUS.
The Trust hereby retains Ultimus to act as the administrator of the Trust
and to furnish the Trust with the services as set forth below. Ultimus hereby
accepts such retention to perform such duties.
Ultimus shall provide the Trust with regulatory reporting services; shall
provide all necessary office space, equipment, personnel, compensation and
facilities for handling the affairs of the Trust; and shall provide such other
services as the Trust may request that Ultimus perform consistent with its
obligations under this Agreement. Without limiting the generality of the
foregoing, Ultimus shall:
(a) calculate expenses and administer all disbursements for the
Portfolios, and as appropriate compute the Portfolios' yields, total
return, expense ratios and portfolio turnover rate;
(b) prepare and coordinate, in consultation with Trust counsel, the
preparation of prospectuses, statements of additional information,
registration statements and proxy materials;
(c) prepare such reports, notice filing forms and other documents
(including reports regarding the sale and redemption of shares of the
Trust as may be required in order to comply with federal and state
securities law) as may be necessary or desirable to make notice
filings relating to the Trust's shares with state securities
authorities, monitor the sale of Trust shares for compliance with
state securities laws, and file with the appropriate state securities
authorities compliance filings as
may be necessary or convenient to enable the Trust to make a
continuous offering of its shares;
(d) develop and prepare, with the assistance of the Trust's investment
adviser, communications to shareholders, including the semi-annual
reports to shareholders, coordinate the mailing of prospectuses,
notices, proxy statements, proxies and other reports to Trust
shareholders, and supervise and facilitate the proxy solicitation
process for all shareholder meetings, including the tabulation of
shareholder votes;
(e) administer contracts on behalf of the Trust with, among others, the
Trust's investment adviser, distributor, custodian, transfer agent and
fund accountant;
(f) supervise the Trust's transfer agent with respect to the payment of
dividends and other distributions to shareholders;
(g) calculate performance data of the Trust for dissemination to
information services covering the investment company industry;
(h) [coordinate, supervise the preparation of and] file all of the Trust's
tax returns, and prepare and mail annual Form 1099, Form W-2P and Form
5498 to appropriate shareholders, with a copy to the Internal Revenue
Service;
(i) assist with the layout and printing of prospectuses and supplements
thereto, and assist with and coordinate layout and printing of the
Trust's semi-annual and annual reports to shareholders;
(j) provide individuals reasonably acceptable to the Board of Trustees of
the Trust (the "Trustees") to serve as officers of the Trust, who will
be responsible for the management of certain of the Trust's affairs as
determined by the Trustees;
(k) advise the Trust and its Trustees on matters concerning the Trust and
its affairs including making recommendations regarding dividends and
distributions;
(l) obtain and keep in effect fidelity bonds and directors and
officers/errors and omissions insurance policies for the Trust in
accordance with the requirements of the 1940 Act and as such bonds and
policies are approved by the Trustees;
(m) monitor and advise the Trust and its Portfolios on their registered
investment company status under the Internal Revenue Code of 1986;
(n) monitor and advise the Trust and its Portfolios on compliance with
applicable limitations as imposed by the 1940 Act and the rules and
regulations thereunder or set forth in the Trust's or any Portfolio's
then current Prospectus or Statement of Additional Information;
(o) provide such internal legal services as are requested by the Trust
including, but not limited to, the coordination of meetings and
preparation of materials for the quarterly and special meetings of the
Trustees and meetings of the Trust's shareholders;
(p) cooperate with, and take all reasonable actions in the performance of
its duties under this Agreement to ensure that all necessary
information is made available to,
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the Trust's independent public accountants in connection with the
preparation of any audit or report requested by the Trust;
(q) cooperate with, and take all reasonable actions in the performance of
its duties under this Agreement to ensure that the necessary
information is made available to the Securities and Exchange
Commission (the "SEC") or any other regulatory authority in connection
with any regulatory audit of the Trust or the investment adviser of
the Trust;
(r) perform all administrative services and functions of the Trust to the
extent administrative services and functions are not provided to the
Trust by other agents of the Trust;
(s) prepare and file with the SEC applicable regulatory reports for the
Trust (including, but not limited to, Form N-SAR and Form N-CSR) and
all required notices pursuant to Rule 24f-2 under the 1940 Act; and
(t) furnish advice and recommendations with respect to other aspects of
the business and affairs of the Trust as the Trust and Ultimus shall
determine desirable.
2. SUBCONTRACTING.
Ultimus may, at its expense and upon prior written approval from the Trust,
subcontract with any entity or person concerning the provision of the services
contemplated hereunder; provided, however, that Ultimus shall not be relieved of
any of its obligations under this Agreement by the appointment of such
subcontractor and provided further, that Ultimus shall be responsible, to the
extent provided in Section 7 hereof, for all acts of such subcontractor as if
such acts were its own.
3. ALLOCATION OF CHARGES AND EXPENSES.
Ultimus shall furnish at its own expense the executive, supervisory and
clerical personnel necessary to perform its obligations under this Agreement.
Ultimus shall also pay all compensation, if any, of officers of the Trust who
are affiliated persons of Ultimus.
The Trust assumes and shall pay or cause to be paid all other expenses of
the Trust not otherwise allocated herein, including, without limitation,
organization costs, taxes, expenses for the Trust's 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 and/or qualification of the shares under
federal and state securities laws, fees and out-of-pocket expenses of Trustees
who are not affiliated persons of Ultimus or the investment adviser to the
Trust, insurance premiums, interest, brokerage costs, litigation and other
extraordinary or nonrecurring expenses, and all fees and charges of investment
advisers to the Trust.
4. COMPENSATION OF ULTIMUS.
For the services to be rendered, the facilities furnished and the expenses
assumed by Ultimus pursuant to this Agreement, the Trust shall pay to Ultimus
compensation at an annual rate specified in Schedule B attached hereto. Such
compensation shall be calculated and accrued
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daily, and paid to Ultimus monthly. The Trust shall also reimburse Ultimus for
its reasonable out-of-pocket expenses, including but not limited to the travel
and lodging expenses incurred by officers and employees of Ultimus in connection
with attendance at Board meetings; provided, however, that Ultimus shall obtain
approval from the Trust prior to incurring any out-of-pocket expense that is
expected to exceed $500.
If this Agreement becomes effective subsequent to the first day of a month
or terminates before the last day of a month, Ultimus' 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 Ultimus' compensation for the preceding month shall be made promptly.
5. EFFECTIVE DATE.
This Agreement shall become effective with respect to a Portfolio as of the
date first written above (or, if a particular Portfolio is not in existence on
that date, on the date such Portfolio commences operation) (the "Effective
Date").
6. TERM OF THIS AGREEMENT.
The term of this Agreement shall continue in effect, unless earlier
terminated by either party hereto as provided hereunder, for a period of two
years. Thereafter, unless otherwise terminated as provided herein, this
Agreement shall be renewed automatically for successive one-year periods.
This Agreement may be terminated without penalty: (i) by provision of sixty
(60) days' written notice; (ii) by mutual agreement of the parties; or (iii) for
"cause" (as defined herein) upon the provision of thirty (30) days' advance
written notice by the party alleging cause.
For purposes of this Agreement, "cause" shall mean: (i) a material breach
of this Agreement that has not been remedied within thirty (30) days following
written notice of such breach from the non-breaching party, (ii) a series of
negligent acts or omissions or breaches of this Agreement which, in the
aggregate, constitute in the reasonable judgment of the Trust, a serious failure
to perform satisfactorily Ultimus' obligations hereunder; (iii) a final,
unappealable judicial, regulatory or administrative ruling or order in which the
party to be terminated has been found guilty of criminal or unethical behavior
in the conduct of its business; or (iv) financial difficulties on the part of
the party to be terminated which are evidenced by the authorization or
commencement of, or involvement by way of pleading, answer, consent or
acquiescence in, a voluntary or involuntary case under Title 11 of the United
States Code, as from time to time is in effect, or any applicable law, other
than said Title 11, of any jurisdiction relating to the liquidation or
reorganization of debtors or the modification or alteration of the rights of
creditors.
Notwithstanding the foregoing, after such termination and for so long as
Ultimus, with the written consent of the Trust, in fact continues to perform any
one or more of the services contemplated by this Agreement or any schedule or
exhibit hereto, the provisions of this Agreement, including without limitation
the provisions dealing with indemnification, shall continue in full force and
effect. Compensation due Ultimus and unpaid by the Trust upon such termination
shall be immediately due and payable upon and notwithstanding such termination.
Ultimus shall be entitled to collect from the Trust, in addition to the
compensation described in Schedule B, the amount of all of Ultimus' reasonable
cash disbursements for services in connection with Ultimus' activities in
effecting such termination, including without limitation,
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the delivery to the Trust and/or its designees of the Trust's property, records,
instruments and documents.
7. STANDARD OF CARE.
The duties of Ultimus shall be confined to those expressly set forth
herein, and no implied duties are assumed by or may be asserted against Ultimus
hereunder. Ultimus shall be obligated to exercise care and diligence in the
performance of its duties hereunder and to act in good faith in performing the
services provided for under this Agreement. Ultimus shall be liable for any
damages arising directly or indirectly out of Ultimus' failure to perform its
duties under this Agreement to the extent such damages arise directly or
indirectly out of Ultimus' willful misfeasance, bad faith, negligence in the
performance of its duties, or reckless disregard of its obligations and duties
hereunder. (As used in this Article 7, the term "Ultimus" shall include
directors, officers, employees and other agents of Ultimus as well as Ultimus
itself.)
Without limiting the generality of the foregoing or any other provision of
this Agreement, (i) Ultimus shall not be liable for losses beyond its reasonable
control, provided that Ultimus has acted in accordance with the standard of care
set forth above; and (ii) Ultimus shall not be liable for the validity or
invalidity or authority or lack thereof of any instruction, notice or other
instrument that Ultimus reasonably believes to be genuine and to have been
signed or presented by a duly authorized representative of the Trust (other than
an employee or other affiliated persons of Ultimus who may otherwise be named as
an authorized representative of the Trust for certain purposes).
Ultimus may apply to the Trust at any time for instructions and may consult
with counsel for the Trust or its own counsel and with accountants and other
experts with respect to any matter arising in connection with Ultimus' duties
hereunder, and Ultimus 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
reasonable opinion of such counsel, accountants or other experts qualified to
render such opinion.
8. INDEMNIFICATION.
The Trust agrees to indemnify and hold harmless Ultimus from and against
any and all actions, suits, claims, losses, damages, costs, charges, reasonable
counsel fees and disbursements, payments, expenses and liabilities (including
reasonable investigation expenses) (collectively, "Losses") arising directly or
indirectly out of any action or omission to act which Ultimus takes (i) at any
request or on the direction of or in reliance on the reasonable advice of the
Trust, (ii) upon any instruction, notice or other instrument that Ultimus
reasonably believes to be genuine and to have been signed or presented by a duly
authorized representative of the Trust (other than an employee or other
affiliated person of Ultimus who may otherwise be named as an authorized
representative of the Trust for certain purposes) or (iii) on its own
initiative, in good faith and in accordance with the standard of care set forth
herein, in connection with the performance of its duties or obligations
hereunder; provided, however that the Trust shall have no obligation to
indemnify or reimburse Ultimus under this Article 8 to the extent that Ultimus
is entitled to reimbursement or indemnification for such Losses under any
liability insurance policy described in this Agreement or otherwise.
Ultimus shall not be indemnified against or held harmless from any Losses
arising directly or indirectly out of Ultimus' own willful misfeasance, bad
faith, negligence in the performance of its duties, or reckless disregard of its
obligations and duties hereunder. (As used
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in this Article 8, the term "Ultimus" shall include directors, officers,
employees and other agents of Ultimus as well as Ultimus itself.)
9. RECORD RETENTION AND CONFIDENTIALITY.
Ultimus shall keep and maintain on behalf of the Trust all books and
records which the Trust and Ultimus is, or may be, required to keep and maintain
pursuant to any applicable statutes, rules and regulations, including without
limitation Rules 31a-1 and 31a-2 under the 1940 Act, relating to the maintenance
of books and records in connection with the services to be provided hereunder.
Ultimus further agrees that all such books and records shall be the property of
the Trust and to make such books and records available for inspection by the
Trust or by the SEC at reasonable times and otherwise to keep confidential all
books and records and other information relative to the Trust and its
shareholders.
Without limiting the foregoing, Ultimus expressly agrees that:
(a) "nonpublic personal information" relating to "consumers" and
"customers" of the Trust (as those terms are defined in Regulation
S-P) provided by or at the direction of the Trust to Ultimus, or
collected or retained by Ultimus in the course of performing its
duties as administrator will be kept confidential. Ultimus will not
use, disclose, sell or in any way transfer such nonpublic personal
information to any person or entity, except as necessary to perform
its obligations under this Agreement, at the direction of the Trust or
otherwise as required or permitted by law;
(b) it will maintain physical, electronic and procedural safeguards
reasonably designed to protect the security, confidentiality and
integrity of, and to prevent unauthorized access to or use of, records
and information relating to consumers and customers of the Trust.
Ultimus will adhere to the privacy policy and procedures of the Trust
and its respective policies and procedures governing information
security. The Trust reserves the right to audit Ultimus to ensure
compliance with such policies and procedures and applicable privacy
laws; and
(c) at the request of the Trust, Ultimus will provide the Trustees with
periodic reports outlining its policies and procedures governing
information security and the implementation of such policies and
procedures. Ultimus will promptly report to the Trust any material
changes to these policies and procedures before, or promptly after,
the adoption of such changes.
10. FORCE MAJEURE.
Ultimus assumes no responsibility hereunder, and shall not be liable, for
any damage, loss of data, delay or any other loss whatsoever caused by events
beyond its reasonable control, including acts of civil or military authority,
national emergencies, fire, flood, catastrophe, acts of God, insurrection, war,
riots or failure of the mails, transportation, communication or power supply;
provided, however, that upon the occurrence of any such event, Ultimus shall use
commercially reasonable best efforts to limit such damages, loss of data, delays
or other losses.
11. RIGHTS OF OWNERSHIP; RETURN OF RECORDS.
All records and other data except computer programs and procedures
developed to perform services required to be provided by Ultimus are the
exclusive property of the Trust and
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all such records and data will be furnished to the Trust in appropriate form as
soon as practicable after termination of this Agreement for any reason. Ultimus
may at its option at any time, and shall promptly upon the Trust's demand, turn
over to the Trust and cease to retain Trust files, records and documents created
and maintained by Ultimus pursuant to this Agreement which are no longer needed
by Ultimus in the performance of its services or for its legal protection. If
not so turned over to the Trust, (1) such documents and records will be copied
and complete copies shall be delivered to the Trust by Ultimus as soon as
reasonably practical, and (2) the original documents and records will be
retained by Ultimus for six years from the year of creation. At the end of such
six-year period, such records and documents will be turned over to the Trust
unless the Trust authorizes in writing the destruction of such records and
documents.
12. REPRESENTATIONS OF THE TRUST.
The Trust certifies to Ultimus that: (1) as of the close of business on the
Effective Date, each Portfolio that is in existence as of the Effective Date has
authorized unlimited shares, and (2) this Agreement has been duly authorized by
the Trust and, when executed and delivered by the Trust, will constitute a
legal, valid and binding obligation of the Trust, enforceable against the Trust
in accordance with its terms, subject to bankruptcy, insolvency, reorganization,
moratorium and other laws of general application affecting the rights and
remedies of creditors and secured parties.
13. REPRESENTATIONS OF ULTIMUS.
Ultimus represents and warrants that: (1) the various procedures and
systems which Ultimus has implemented with regard to safeguarding from loss or
damage attributable to fire, theft, or any other cause the records, and other
data of the Trust and Ultimus' records, data, equipment facilities and other
property used in the performance of its obligations hereunder are adequate and
that it will make such changes therein from time to time as are required for the
secure performance of its obligations hereunder, (2) this Agreement has been
duly authorized by Ultimus and, when executed and delivered by Ultimus, will
constitute a legal, valid and binding obligation of Ultimus, enforceable against
Ultimus in accordance with its terms, subject to bankruptcy, insolvency,
reorganization, moratorium and other laws of general application affecting the
rights and remedies of creditors and secured parties, (3) it is duly registered
with the appropriate regulatory agency as a transfer agent and such registration
will remain in full force and effect for the duration of this Agreement, and (4)
it has and will continue to have access to the necessary facilities, equipment
and personnel to perform its duties and obligations under this Agreement.
14. INSURANCE.
Ultimus shall furnish the Trust with pertinent information concerning the
professional liability insurance coverage that it maintains. Such information
shall include the identity of the insurance carrier(s), coverage levels and
deductible amounts. Ultimus shall notify the Trust should any of its insurance
coverage be canceled or reduced. Such notification shall include the date of
change and the reasons therefor. Ultimus shall notify the Trust of any material
claims against it with respect to services performed under this Agreement,
whether or not they may be covered by insurance, and shall notify the Trust from
time to time as may be appropriate of the total outstanding claims made by
Ultimus under its insurance coverage.
Further, Ultimus shall furnish the Trust with a Certificate of Insurance or
a copy of the policy evidencing such coverage, which insurance shall name the
Trust as an Insured Investment
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Company under the policy, and shall contain a 60-day "cancellation" clause and a
"changes in exposure" clause. Such policy shall be primary coverage as between
Ultimus and the Trust and such insurance coverage shall not limit the liability
of Ultimus to the Trust for any damages. In the event of any payment of damages
to the Trust, Ultimus hereby waives any right to be subrogated to the rights of
the Trust against any third party.
15. INFORMATION TO BE FURNISHED BY THE TRUST.
The Trust has furnished to Ultimus the following:
(a) Copies of the Declaration of Trust and of any amendments thereto,
certified by the proper official of the state in which such document
has been filed.
(b) Copies of the following documents:
(1) The Trust's Bylaws and any amendments thereto; and
(2) Certified copies of resolutions of the Trustees covering the
approval of this Agreement, authorization of a specified officer
of the Trust to execute and deliver this Agreement and
authorization for specified officers of the Trust to instruct
Ultimus thereunder.
(c) A list of all the officers of the Trust, together with specimen
signatures of those officers who are authorized to instruct Ultimus in
all matters.
(d) Copies of the Prospectus and Statement of Additional Information for
each Portfolio.
16. AMENDMENTS TO AGREEMENT.
This Agreement, or any term thereof, may be changed or waived only by
written amendment signed by the party against whom enforcement of such change or
waiver is sought.
For special cases, the parties hereto may amend such procedures set forth
herein as may be appropriate or practical under the circumstances, and Ultimus
may conclusively assume that any special procedure which has been approved by
the Trust does not conflict with or violate any requirements of its Declaration
of Trust or then current prospectuses, or any rule, regulation or requirement of
any regulatory body.
17. COMPLIANCE WITH LAW.
Except for the obligations of Ultimus otherwise set forth herein, the Trust
assumes full responsibility for the preparation, contents and distribution of
each prospectus of the Trust as to compliance with all applicable requirements
of the Securities Act of 1933, as amended (the "Securities Act"), the 1940 Act
and any other laws, rules and regulations of governmental authorities having
jurisdiction. The Trust represents and warrants that no shares of the Trust will
be offered to the public until the Trust's registration statement under the
Securities Act and the 1940 Act has been declared or becomes effective.
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18. NOTICES.
Any notice provided hereunder shall be sufficiently given when sent by
registered or certified mail to the party required to be served with such
notice, at the following address: if to the Trust, at 0000 Xxxxx Xxxxxxxxx,
Xxxxxx, Xxxxx Xxxxxxxx 00000, and if to Ultimus, at 000 Xxxxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxxxx, Xxxx 00000, Attn: Xxxxxx X. Xxxxxx; or at such other address as
such party may from time to time specify in writing to the other party pursuant
to this Section.
19. ASSIGNMENT.
This Agreement and the rights and duties hereunder shall not be assignable
by either of the parties hereto except by the specific written consent of the
other party, and any assignment in violation of this section will be void. This
Agreement shall be binding upon, and shall inure to the benefit of, the parties
hereto and their respective successors and permitted assigns.
20. GOVERNING LAW.
This Agreement shall be construed in accordance with the laws of the State
of New York without giving effect to the provisions thereof relating to
conflicts of law. To the extent that the applicable laws of the State of New
York, or any of the provisions herein, conflict with the applicable provisions
of the 1940 Act, the latter shall control.
21. LIMITATION OF LIABILITY.
A copy of the Declaration of Trust of the Trust is on file with the
Secretary of the Commonwealth of Massachusetts, and notice is hereby given that
this instrument is executed on behalf of the Trustees and not individually and
that the obligations of this instrument are not binding upon any of the
Trustees, officers or shareholders individually but are binding only upon the
assets and property of the Trust (or if the matter relates only to a particular
Portfolio, that Portfolio), and Ultimus shall look only to the assets of the
Trust, or the particular Portfolio, for the satisfaction of such obligations.
22. MULTIPLE ORIGINALS.
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.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed all as of the day and year first above written.
XXX XXXXX TRUST
By: /s/ Xxxxx X. Xxxxx, Xx.
-----------------------------
Title: President
ULTIMUS FUND SOLUTIONS, LLC
By: /s/ Xxxxxx X. Xxxxxx
-----------------------------
Title: President
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SCHEDULE A
TO THE ADMINISTRATION AGREEMENT
BETWEEN
XXX XXXXX TRUST
AND
ULTIMUS FUND SOLUTIONS, LLC
FUND PORTFOLIOS
---------------
Xxx Xxxxx Fund
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SCHEDULE B
TO THE ADMINISTRATION AGREEMENT
BETWEEN
XXX XXXXX TRUST
AND
ULTIMUS FUND SOLUTIONS, LLC
FEES
----
Pursuant to Article 4, in consideration of services rendered and expenses
assumed pursuant to this Agreement, the Trust will pay Ultimus on the first
business day after the end of each month, or at such time(s) as Ultimus shall
request and the parties hereto agree, a fee at an annual rate computed with
respect to each Portfolio as follows:
---------------------------------------- --------------------------------
AVERAGE DAILY NET ASSETS ADMINISTRATION FEE
---------------------------------------- --------------------------------
Up to $50 million .100%
---------------------------------------- ---------------------------------
$50 to $200 million .075%
---------------------------------------- --------------------------------
In excess of $200 million .050%
---------------------------------------- --------------------------------
The fee will be subject to a monthly minimum of $2,000 with respect to each
Portfolio.
The fees set forth above shall be in addition to the payment of reasonable
out-of-pocket expenses, as provided for in Section 4 of this Agreement.
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