ADMINISTRATION AGREEMENT
ADMINISTRATION AGREEMENT, made this [___] day of November, 1999, between
Fixed Income SHares (the "Trust"), a Massachusetts business trust, and PIMCO
Advisory Services (the "Administrator" or "PAS").
WHEREAS, the Trust is registered with the Securities and Exchange
Commission ("SEC") as an open-end management investment Company under the
Investment Company Act of 1940, as amended (the "1940 Act"); and
WHEREAS, the Trust is authorized to issue shares of beneficial interest
("Shares") in separate series, with each such series representing interests in
a separate portfolio of securities and other assets; and
WHEREAS, the Trust has established multiple series, including FISH: Series
C and FISH: Series M (each a "Portfolio"); and
WHEREAS, the Trust wishes to retain PAS to provide administrative and
other services to the Trust with respect to the Portfolios in the manner and on
the terms hereinafter set forth; and
WHEREAS, PAS is willing to furnish such services in the manner and on the
terms hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, the parties agree as follows:
1. APPOINTMENT. The Trust hereby appoints PAS as Administrator to
provide the administrative and other services with respect to the Portfolios
for the period and on the terms set forth in this Agreement. The Administrator
accepts such appointment and agrees during such period to render the services
herein set forth for the compensation herein provided.
In the event the Trust establishes and designates additional series with
respect to which it desires to retain the Administrator to render
administrative and other services hereunder, it shall notify the Administrator
in writing. If the Administrator is willing to render such services, it shall
notify the Trust in writing, whereupon such additional series shall become a
Portfolio hereunder.
2. DUTIES. Subject to the general supervision of the Board of Trustees,
the Administrator shall provide all organizational, administrative and other
services reasonably necessary for the operation of the Portfolios other than
the investment advisory services
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provided by PIMCO Advisors, L.P. pursuant to its Investment Advisory Agreement
with the Trust.
(a) ADMINISTRATIVE SERVICES. Subject to the approval or consent of the
Board of Trustees, the Administrator shall provide or procure, at the
Administrator's expense, services to include the following: (i) coordinating
matters relating to the operation of the Portfolios, including any necessary
coordination among the adviser or advisers to the Portfolios, the custodian(s),
transfer agent(s), dividend disbursing agent(s), and recordkeeping agent(s)
(including pricing and valuation of the Portfolios), accountants, attorneys,
and other parties performing services or operational functions for the
Portfolios; (ii) providing the Portfolios with the services of a sufficient
number of persons competent to perform such administrative and clerical
functions as are necessary to ensure compliance with federal securities laws,
as well as other applicable laws, and to provide effective administration of
the Portfolios; (iii) maintaining, or supervising the maintenance by third
parties, of such books and records of the Trust and the Portfolios as may be
required by applicable federal or state law other than the records and ledgers
maintained under the Investment Advisory Agreement; (iv) preparing or
supervising the preparation by third parties of all federal, state, and local
tax returns and reports of the Portfolios required by applicable law; (v)
preparing, filing, and arranging for the distribution of proxy materials and
periodic reports to financial intermediaries investing in the Portfolios as
required by applicable law; (vi) preparing and arranging for the filing of such
registration statement and other documents with the SEC and other federal and
state regulatory authorities as may be required to register the shares of the
Portfolios and qualify the Trust to do business or as otherwise required by
applicable law; (vii) taking such other action with respect to the Portfolios
as may be required by applicable law, including, without limitation, the rules
and regulations of the SEC and of state securities commissions and other
regulatory agencies; and (viii) providing the Portfolios with adequate
personnel, office space, communications facilities, and other facilities
necessary for the Portfolios' operations as contemplated in this Agreement.
(b) OTHER SERVICES. Subject to the approval or consent of the Board of
Trustees, the Administrator shall also provide or procure on behalf of the
Trust and the Portfolios, and at the expense of the Administrator, the
following services to the Portfolios: (i) custodian services to provide for
the safekeeping of the Portfolios' assets; (ii) recordkeeping services to
maintain the portfolio accounting records for the Portfolios; (iii) transfer
agency services to maintain the portfolio accounting records for the
Portfolios; and (iv) dividend disbursing services for the Portfolios. The
services to be provided under (iii) and (iv) of this Section 2(b) shall be
commensurate with the level of services reasonably necessary for
institutional investors. The Trust may be a party to any agreement with any
person or persons engaged to provide the services referred to in this
Section 2(b).
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(c) ORGANIZATIONAL SERVICES. The Administrator shall provide the Trust
and the Portfolios, at the Administrator's expense, with the services necessary
to organize any Portfolios that commence operations on or after the date of
this Agreement so that such Portfolios can conduct business as described in the
Trust's Registration Statement.
(d) The Administrator shall also make its officers and employees
available to the Board of Trustees and officers of the Trust for consultation
and discussions regarding the administration of the Portfolios and services
provided to the Portfolios under this agreement.
(e) In performing these services, the Administrator:
(i) Shall conform with the 1940 Act and all rules and regulations
thereunder, all other applicable federal and state laws and regulations, with
any applicable procedures adopted by the Trust's Board of Trustees, and with
the provisions of the Trust's Registration Statement filed on Form N-1A as
supplemented or amended from time to time.
(ii) Will make available to the Trust, promptly upon request, any of the
Portfolios' books and records as are maintained under this Agreement, and will
furnish to regulatory authorities having the requisite authority any such books
and records and any information or reports in connection with the
Administrator's services under this Agreement that may be requested in order to
ascertain whether the operations of the Trust are being conducted in a manner
consistent with applicable laws and regulations.
(iii) Will regularly report to the Trust's Board of Trustees on the
services provided under this Agreement and will furnish the Trust's Board of
Trustees with respect to the Portfolios such periodic and special reports as
the Trustees may reasonably request.
3. DOCUMENTATION. The Trust has delivered copies of each of the following
documents to the Administrator and will deliver to it all future amendments and
supplements thereto, if any:
(a) the Trust's Registration Statement as filed with the SEC and any
amendments thereto; and
(b) exhibits, powers of attorneys, certificates and any and all other
documents relating to or filed in connection with the Registration Statement
described above.
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4. INDEPENDENT CONTRACTOR. The Administrator shall for all purposes
herein be deemed to be an independent contractor and shall, unless otherwise
expressly provided herein or authorized by the Board of Trustees of the Trust
from time to time, have no authority to act for or represent the Trust in any
way or otherwise be deemed its agent.
5. COMPENSATION. The Trust shall pay no compensation to the
Administrator for the services rendered under this Agreement.
6. NON-EXCLUSIVITY. It is understood that the services of the
Administrator hereunder are not exclusive, and the Administrator shall be free
to render similar services to other investment companies and other clients.
7. EXPENSES. During the term of this Agreement, the Administrator will
pay all expenses incurred by it in connection with its obligations under this
Agreement, except such expenses as are those of the Portfolios under this
Agreement. The Administrator shall pay for maintaining its staff and personnel
and shall, at its own expense provide the equipment, office space, and
facilities necessary to perform its obligations under this Agreement. In
addition, the Administrator shall, at its expense, furnish to the Trust:
(a) Services by the Trust's independent public accountants to perform all
audits;
(b) Services of the Trust's transfer agent(s), registrar, dividend
disbursing agent(s), and shareholder recordkeeping services;
(c) Services of the Trust's custodian, including any recordkeeping
services provided by the custodian;
(d) Services of obtaining quotations for calculating the value of each
Portfolio's net assets;
(e) Services of obtaining Portfolio Activity Reports for each Portfolio;
(f) Services of maintaining the Trust's tax records;
(g) Services, including procurement of legal services, incident to
meetings of the Trust's shareholders, the preparation and mailing of
prospectuses and reports of the Trust to its shareholders, the filing of
reports with regulatory bodies, the maintenance of the Trust's existence and
qualification to do business, and the registration of shares with federal and
state securities authorities (except as described in subsection (f) below);
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(h) Procurement of ordinary legal services, including the services that
arise in the ordinary course of business for a Massachusetts business trust
registered as an open-end management investment company;
(i) Certificates representing shares of the Trust;
(j) The Trust's pro rata portion of the fidelity bond required by Section
17(g) of the 1940 Act, or other insurance premiums;
(k) Association membership dues; and
(l) Services to organize and offer shares of the Trust and the Portfolios.
The Trust shall bear the following expenses:
(a) Salaries and other compensation of any of the Trust's executive
officers and employees, if any, who are not officers, directors, stockholders,
or employees of the Administrator or its subsidiaries or affiliates;
(b) Taxes, if any, levied against the Trust or any of its Portfolios;
(c) Brokerage fees and commissions in connection with the purchase and
sale of portfolio securities for any of the Portfolios;
(d) Costs, including the interest expenses, of borrowing money;
(e) Fees and expenses of trustees who are not officers, employees, or
stockholders of PAS or its subsidiaries or affiliates, and the fees and
expenses of any counsel, accountants, or any other persons engaged by such
trustees in connection with the duties of their office with the Trust;
(f) Extraordinary expenses, including extraordinary legal expenses and
federal and state securities registration fees and expenses to the extent
authorized by the Trust's Board of Trustees, as may arise, including expenses
incurred in connection with litigation, proceedings, other claims and the legal
obligations of the Trust to indemnify its trustees, officers, employees,
shareholders, distributors, and agents with respect thereto;
(g) Organizational and offering expenses of the Trust and the Portfolios
to the extent authorized by the Trust's Board of Trustees, and any other
expenses which are capitalized in accordance with generally accepted accounting
principles; and
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(h) Any expenses allocated or allocable to a specific Portfolio,
including fees paid pursuant to an administrative services or distribution plan.
8. LIABILITY. The Administrator shall give the Trust the benefit of the
Administrator's best efforts in rendering services under this Agreement. The
Administrator may rely on information reasonably believed by it to be accurate
and reliable. As an inducement for the Administrator's undertaking to render
services under this Agreement, the Trust agrees that neither the Administrator
nor its stockholders, officers, directors, or employees shall be subject to any
liability for, or any damages, expenses or losses incurred in connection with,
any act or omission or mistake in judgment connected with or arising out of any
services rendered under this Agreement, except by reason of willful
misfeasance, bad faith, or gross negligence in performance of the
Administrator's duties, or by reason of reckless disregard of the
Administrator's obligations and duties under this Agreement. This provision
shall govern only the liability to the Trust of the Administrator and that of
its stockholders, officers, directors, and employees, and shall in no way
govern the liability to the Trust or the Administrator or provide a defense for
any other person, including persons that provide services for the Portfolios as
described in Section 2(b) or (c) of this Agreement.
9. TERM AND CONTINUATION. This Agreement shall take effect as of the
date hereof, and shall remain in effect, unless sooner terminated as provided
herein, until two years from the date of this Agreement, and shall continue
thereafter on an annual basis with respect to each Portfolio, provided that
such continuance is specifically approved at least annually (a) by the vote of
a majority of the Board of Trustees of the Trust, or (b) by vote of a majority
of the outstanding voting shares of the Portfolios, and provided continuance is
also approved by the vote of a majority of the Board of Trustees of the Trust
who are not parties to this Agreement or "interested persons" (as defined in
the 0000 Xxx) of the Trust, or PAS, cast in person at a meeting called for the
purpose of voting on such approval.
This Agreement may be terminated:
(a) by the Trust at any time with respect to the services provided by the
Administrator by vote of (1) a majority of the Trustees of the Trust; (2) a
majority of the Trustees of the Trust who are not "interested persons" (as such
term is defined in the 0000 Xxx) of the Trust or PAS; or (3) a majority of the
outstanding voting shares of the Trust or, with respect to a particular
Portfolio, by vote of a majority of the outstanding voting shares of such
Portfolio, on 60 days' written notice to the Administrator; and
(b) by the Administrator at any time, without the payment of any penalty,
upon 60 days' written notice to the Trust.
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10. USE OF NAME. It is understood that the name "PIMCO Advisory
Services" or "PAS" or any derivative thereof or logo associated with those
names are the valuable property of PAS and its affiliates.
11. NOTICES. Notices of any kind to be given to the Administrator by the
Trust shall be in writing and shall be duly given if mailed or delivered to the
Administrator at 1345 Avenue of the Americas, Xxx Xxxx, Xxx Xxxx 00000, or to
such other address or to such individual as shall be specified by the
Administrator. Notices of any kind to be given to the Trust by the
Administrator shall be in writing and shall be duly given if mailed or
delivered to 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, or to such
other address or to such individual as shall be specified by the Trust.
12. TRUST OBLIGATION. A copy of the Trust's Agreement and Declaration of
Trust, as amended, is on file with the Secretary of the Commonwealth of
Massachusetts, and notice is hereby given that the Agreement has been executed
on behalf of the Trust by a trustee of the Trust in his or her capacity as
trustee and not individually. The obligations of this Agreement shall only be
binding upon the assets and property of the Trust and shall not be binding
upon any trustee, officer, or shareholder of the Trust individually.
13. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original.
14. MISCELLANEOUS.
(a) This Agreement shall be governed by the laws of Massachusetts,
provided that nothing herein shall be construed in a manner inconsistent with
the 1940 Act or any rule or order of the SEC thereunder.
(b) If any provision of this Agreement shall be held or made invalid by a
court decision, statute, rule or otherwise, the remainder of this Agreement
shall not be affected thereby and, to this extent, the provisions of this
agreement shall be deemed to be severable. To the extent that any provision of
this Agreement shall be held or made invalid by a court decision, statute, rule
or otherwise with regard to any party hereunder, such provisions with respect
to other parties hereto shall not be affected thereby.
(c) The captions in this Agreement are included for convenience only and
in no way define any of the provisions hereof or otherwise affect their
construction or effect.
(d) This Agreement may not be assigned by the Trust or the Administrator
without the consent of the other party.
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IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed by their officers designated below on the day and year first above
written.
Fixed Income SHares
By: _________________________________
Title: Executive Vice President
PIMCO ADVISORY SERVICES
By: _________________________________
Title: Chief Executive Officer
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