EXHIBIT NO. 99.11(b)
MASTER ADMINISTRATIVE SERVICES AGREEMENT
MASTER ADMINISTRATIVE SERVICES AGREEMENT dated this 1st day of March, 1997, as
amended effective April 1, 1999, by and among Massachusetts Financial Services
Company, a Delaware corporation (the "Administrator"), and each of the funds (or
trusts acting on behalf of their series) identified from time to time on Exhibit
A hereto (each a "Fund" and collectively the "Funds").
W I T N E S S E T H:
WHEREAS, the Funds have entered into Investment Advisory Agreements with the
Administrator (the "Advisory Agreements") pursuant to which the Administrator
provides investment advisory services to the Funds;
WHEREAS, the Advisory Agreements recite that the Administrator will bear certain
expenses associated with the provision of investment advisory services and that
the Funds will bear their own expenses, including expenses of legal counsel to
the Funds, expenses connected with the execution, recording and settlement of
the Funds' portfolio security transactions and expenses of calculating the
Funds' net asset values;
WHEREAS, the Administrator, at its expense, has provided a variety of
administrative services to the Funds for the benefit of the Funds and their
shareholders; and
WHEREAS, the Funds desire to retain the Administrator to render certain legal,
financial administration and other administrative services to the Funds in the
manner and on the terms and conditions hereinafter set forth;
NOW THEREFORE, in consideration of the mutual covenants and agreements of the
parties hereto and hereinafter set forth, the parties covenant and agree as
follows:
1. Administrative Services. Subject to the limitations set forth in the second
paragraph of Section 3 of this Agreement, the Administrator shall render to each
Fund the financial administration services set forth on Exhibit B hereto (the
"Financial Administration Services"), the legal services set forth on Exhibit C
hereto (the "Legal Services") and the other administrative services set forth on
Exhibit D hereto ("Other Administrative Services") (the Financial Administration
Services, Legal Services and Other Administrative Services are collectively
referred to as the "Administrative Services").
The Administrative Services provided by the Administrator to each Fund
may not include all Administrative Services required by the Fund, due to a
number of considerations, including, without limitation, the Administrator's
level of work flow, staffing and resources, the specialized or unique nature of
the Administrative Services and the relative priorities of such Administrative
Services. The Administrator may, on behalf of each Fund, arrange for or engage
outside legal counsel, accounting or auditing firm or any other outside service
provider or vendor (collectively, "third party vendors") to perform
Administrative Services for the Fund, and the Fund will bear the expense of any
such third party vendors; provided however, that the Administrator shall
promptly inform the Fund's governing board in the event any third party vendor
is engaged to perform Administrative Services for a Fund on a basis that is
expected to generate significant expenses for a Fund.
2. Maintenance of Books and Records. With respect to the provision of
Administrative Services, the Administrator will preserve for each Fund that is
registered as a registered investment company with the Securities and Exchange
Commission (the "SEC") all records required to be maintained as prescribed by
the rules and regulations of the SEC in the manner and for the time periods
prescribed by such rules. The Administrator agrees that all such records shall
be the property and under the control of each Fund for which they are maintained
and shall be made available, within five business days of any request therefor,
to the Fund's Board of Trustees or auditors during regular business hours at the
Administrator's offices. In the event of termination of this Agreement for any
reason, all such records shall be returned, without charge, promptly to the
appropriate Fund, free from any claim or retention of rights by the
Administrator, except that the Administrator may retain copies of such records.
3. Administrative Fee. Each Fund shall pay the Administrator a fee as agreed to
from time to time and as set forth in Exhibit E hereto (the "Administrative
Fee"). The Administrative Fee shall be accrued for each calendar day and the sum
of the daily fee accruals shall be paid monthly to the Administrator on the
second to last business day of each calendar month. If this Agreement becomes
effective or terminates before the end of any calendar month, the Administrative
Fee for the period from the effective date to the end of such calendar month or
from the beginning of such calendar month to the date of termination, as the
case may be, shall be prorated according to the proportion which such period
bears to the full month in which such effectiveness or termination occurs.
The governing board of each Fund will, on an annual basis, review the
services provided, the Administrator's costs in providing such services, amounts
paid to third party vendors pursuant to the arrangement described in Section 1
and the amount paid by the Fund to the Administrator pursuant to this Agreement
(including the extent to which such amount is greater or lesser than the
Administrator's costs in
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providing such services) and such other information as such board may reasonably
request.
4. Scope of Administrative Services; Regulatory and Business and Industry
Practice Developments. The Administrative Services to be furnished by the
Administrator include only those services required by a Fund or which are being
furnished by the Administrator at March 1, 1997. In the event that, subsequent
to March 1, 1997, because of regulatory developments, or new or modified
business or industry practices, the Fund requires services in addition to the
Administrative Services, at the request of the Fund, the Administrator will
consider furnishing such additional services, with compensation for such
additional services to be agreed upon with respect to each such occasion as it
arises.
5. Non-Exclusivity. The services of the Administrator to the Funds hereunder are
not to be deemed exclusive and the Administrator shall be free to render similar
services to others.
6. Standard of Care. Neither the Administrator, nor any of its directors,
officers, stockholders, agents or employees, shall be liable or responsible to
any Fund or its shareholders for any error of judgment, mistake of law or any
loss arising out of any act or omission in the performance by the Administrator
of its duties under this Agreement, except for liability resulting from (a)
willful misfeasance, (b) bad faith, (c) in the case of Financial Administration
Services, negligence, and, in the case of Legal Services and Other
Administrative Services, gross negligence, in each case on the Administrator's
part or (d) from reckless disregard by the Administrator of its obligations and
duties under this Agreement.
7. Term, Termination, Amendment and Assignment. This Agreement shall begin on
the date first written above and shall continue indefinitely. The Agreement may
be terminated at any time, without payment of any penalty, by the Board of
Directors/Trustees which oversees the Fund upon sixty (60) days' written notice
to the Administrator. This Agreement may be terminated by the Administrator with
respect to any Fund at any time upon sixty (60) days' written notice to the
Fund. This Agreement may be amended at any time by a written agreement executed
by each party hereto and may be assigned with respect to any Fund only with the
written consent of the Fund and the Administrator.
8. Miscellaneous.
a. Captions. The captions in this Agreement are included for convenience of
reference only and in no way define or delineate any of the provisions
hereof or otherwise affect their construction or effect.
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b. Governing Law. The provisions of this Agreement shall be construed and
interpreted in accordance with the domestic substantive laws of The
Commonwealth of Massachusetts, without giving effect to any conflicts or
choice of laws rule or provision that would result in the application of
the domestic substantive laws of any other jurisdiction.
c. Counterparts. This Agreement may be executed simultaneously in two or
more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
d. Joinder of Funds. In the event that additional funds are created from
time to time which desire to retain the Administrator to provide them
with Administration Services pursuant to this Agreement, the
Administrator and the additional fund may jointly amend Schedule A hereto
to add the additional fund, and the additional fund shall thereafter be
deemed a "Fund" for all purposes of this Agreement. The consent of the
other parties to this Agreement shall not be required to amend Schedule A
hereto.
e. Scope of Fund's Obligations. A copy of the Declaration of Trust of each
Fund (or trust of which the Fund is a series) organized as a
Massachusetts business trust (each a "Trust"), is on file with the
Secretary of State of The Commonwealth of Massachusetts. The
Administrator acknowledges that the obligations of or arising out of this
Agreement are not binding upon any of a Trust's trustees, officers,
employees, agents or shareholders individually, but are binding solely
upon the assets and property of the Trust in accordance with its
proportionate interest thereunder and hereunder. If this Agreement is
executed by the Trust on behalf of one or more series of the Trust, the
Administrator further acknowledges that the assets and liabilities of
each series of the Trust are separate and distinct and that the
obligations of or arising out of this Agreement are binding solely upon
the assets or property of the series on whose behalf the Trust has
executed this Agreement. The Administrator also agrees that the
obligations of each Fund hereunder shall be several and not joint, in
accordance with its proportionate interest hereunder, and agrees not to
proceed (by way of claim, set-off or otherwise) against any Fund for the
obligations of another Fund.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be signed
by their respective officers thereunto duly authorized and their respective
corporate seals to be hereunto affiliated, as of the date first written above.
On behalf of the MFS Family
of Funds, MFS Closed-End
Funds and MFS Institutional
Funds listed on Exhibit A
hereto
By: XXXXXX X. XXXXX
---------------------------------
Xxxxxx X. Xxxxx
Trustee
On behalf of the MFS/Sun
Life Series Trust and
Compass Products listed on
Exhibit A hereto
By: XXXX X. XXXXXX
---------------------------------
Xxxx X. XxXxxx
Chairman
MASSACHUSETTS FINANCIAL SERVICES COMPANY
By: XXXXXXX X. XXXXXX
---------------------------------
Xxxxxxx X. Xxxxxx
Chairman
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Exhibit A
Funds
I. MFS Family of Funds
MFS Series Trust I:
MFS Managed Sectors Fund
MFS Cash Reserve Fund
MFS Global Asset Allocation Fund
MFS Strategic Growth Fund
MFS Research Growth and Income Fund
MFS Equity Income Fund
MFS Core Growth Fund
MFS Convertible Securities Fund
MFS Blue Chip Fund
MFS New Discovery Fund
MFS Science and Technology Fund
MFS Research International Fund
MFS Series Trust II:
MFS Emerging Growth Fund
MFS Large Cap Growth Fund
MFS Intermediate Income Fund
MFS Charter Income Fund
MFS Series Trust III:
MFS High Income Fund
MFS Municipal High Income Fund
MFS High Yield Opportunities Fund
MFS Series Trust IV:
MFS Money Market Fund
MFS Government Money Market Fund
MFS Municipal Bond Fund
MFS Mid Cap Growth Fund
MFS Series Trust V:
MFS Total Return Fund
MFS Research Fund
MFS International Opportunities Fund
MFS International Strategic Growth Fund
MFS International Value Fund
MFS Asia Pacific Fund
MFS Series Trust VI:
MFS Global Total Return Fund
MFS Utilities Fund
MFS Global Equity Fund
MFS Series Trust VII:
MFS Global Governments Fund
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MFS Capital Opportunities Fund
MFS Series Trust VIII:
MFS Strategic Income Fund
MFS Global Growth Fund
MFS Series Trust IX:
MFS Bond Fund
MFS Limited Maturity Fund
MFS Municipal Limited Maturity Fund
MFS Research Bond Fund
MFS Intermediate Investment Grade Bond Fund
MFS Series Trust X:
MFS Government Mortgage Fund
MFS/Foreign & Colonial Emerging Markets Equity Fund
MFS International Growth Fund
MFS International Growth and Income Fund
MFS Strategic Value Fund
MFS Small Cap Value Fund
MFS Emerging Markets Debt Fund
MFS Municipal Series Trust:
MFS Alabama Municipal Bond Fund
MFS Arkansas Municipal Bond Fund
MFS California Municipal Bond Fund
MFS Florida Municipal Bond Fund
MFS Georgia Municipal Bond Fund
MFS Maryland Municipal Bond Fund
MFS Massachusetts Municipal Bond Fund
MFS Mississippi Municipal Bond Fund
MFS New York Municipal Bond Fund
MFS North Carolina Municipal Bond Fund
MFS Pennsylvania Municipal Bond Fund
MFS South Carolina Municipal Bond Fund
MFS Tennessee Municipal Bond Fund
MFS Virginia Municipal Bond Fund
MFS West Virginia Municipal Bond Fund
MFS Municipal Income Fund
MFS Growth Opportunities Fund
MFS Government Securities Fund
Massachusetts Investors Growth Stock Fund
MFS Government Limited Maturity Fund
Massachusetts Investors Trust
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II. MFS Closed-End Funds
MFS Municipal Income Trust
MFS Multimarket Income Trust
MFS Government Markets Income Trust
MFS Intermediate Income Trust
MFS Charter Income Trust MFS Special Value Trust
III. MFS Institutional Funds
MFS Institutional Trust:
MFS Institutional Emerging Equities Fund
MFS Institutional Global Fixed Income Fund
MFS Institutional Emerging Markets Debt Fund
MFS Institutional International Equity Fund
MFS Institutional Mid Cap Growth Equity Fund
MFS Institutional Research Fund
MFS Institutional Core Fixed Income Fund
MFS Institutional Core Equity Fund
MFS Institutional Large Cap Growth Fund
MFS Institutional High Yield Fund
MFS Series Trust XI:
MFS Union Standard Equity Fund
Vertex All Cap Fund
Vertex Contrarian Fund
Vertex U.S. All Cap Fund
MFS Variable Insurance Trust:
MFS Emerging Growth Series
MFS Value Series
MFS Research Series
MFS Growth With Income Series
MFS Total Return Series
MFS Utilities Series
MFS High Income Series
MFS World Governments Series
MFS Bond Series
MFS Limited Maturity Series
MFS Money Market Series
MFS/Foreign & Colonial Emerging Markets Equity Series
MFS New Discovery Series
MFS Growth Series
IV. MFS/Sun Life Series Trust
MFS Capital Appreciation Series
MFS Conservative Growth Series
MFS Government Securities Series
MFS World Governments Series
MFS High Yield Series
MFS Managed Sectors Series
MFS Money Market Series
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MFS Total Return Series
MFS Utilities Series
MFS World Growth Series
MFS Zero Coupon Series 2000
MFS Research Series
MFS World Asset Allocation Series
MFS World Total Return Series
MFS Emerging Growth Series
MFS International Growth and Income Series
MFS International Growth Series
MFS/Foreign & Colonial Emerging Markets Equity Series
MFS Capital Opportunities Series
MFS Research Growth and Income Series
MFS Bond Series
MFS Equity Income Series Massachusetts Investors Growth Stock Series
MFS New Discovery Series
MFS Research International Series
MFS Strategic Income Series
V. Compass Products
MFS Capital Appreciation Variable Account
MFS Government Securities Variable Account
MFS World Governments Variable Account
MFS High Yield Variable Account
MFS Managed Sectors Variable Account
MFS Money Market Variable Account
MFS Total Return Variable Account
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Exhibit B
Financial Administration Services
The Administrator shall perform the following Financial Administration
Services for each Fund:
A. General Services.
1. Prepare such financial information of the Fund as is reasonably
necessary for reports to shareholders of the Fund, reports to the Fund's
governing board and officers, and reports to appropriate regulatory
authorities including, without limitation, prospectuses, shareholder
reports, shareholder notices, proxy statements and other periodic
reports and render statements or copies of records as from time to time
are reasonably requested by the Fund.
2. Facilitate audits of accounts by the Fund's independent public
accountants or by any of the auditors employed or engaged by the Fund or
by any regulatory body with jurisdiction over the Fund. Coordinate with,
and monitor the performance of, the custodian banks retained by the Fund
to perform the necessary custodial services for the Fund including,
without limitation, the safekeeping of the funds and securities.
3. Negotiate contracts for computing the Fund's net asset value per share,
and, if applicable, its public offering price and/or its daily dividend
rates and money market yields and other investment performance
quotations, in accordance with sub-paragraph C below, and notify the
Fund and such other persons as the Fund may reasonably request of the
net asset value per share, the public offering price and/or its daily
dividend rates and money market yields and other investment performance
quotations.
B. Valuation of Securities. The Administrator shall ensure that the value of the
Fund's securities is computed in accordance with governing law, rules and
regulations, the Fund's governing instruments and subject to the oversight and
direction of the Fund's governing body. The Administrator may use one or more
external pricing services in computing the value of a Fund's securities,
including broker/dealers, provided that the Fund's governing body or an
individual designated by the Fund's governing body has approved the use of such
pricing services.
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C. Computation of Net Asset Value, Public Offering Price, Daily Dividend Rates
and Performance Quotations. The Administrator shall assure that the Fund's net
asset value, net income, public offering price, dividend rates and money market
yields, if applicable, and other investment performance quotations are
calculated in a manner and at such time or times as the Fund shall direct and in
accordance with governing law, rules and regulations and the Fund's governing
instruments and subject to the oversight and direction of the Fund's governing
board.
D. Other Financial Administration Services. In addition, the Administrator shall
provide the following Financial Administration Services:
(1) Provide Treasurers or Assistant Treasurers to serve as officers of the
Fund;
(2) Coordinate the meetings of the Audit Committees, assure that meetings
are scheduled and that agendas are prepared; participate in meetings of
the Audit Committee;
(3) Review contracts and negotiate fees for the Fund for services such as
independent audit fees, custodian fees, transfer agent fees and the fees
of other service providers to the Fund;
(4) Oversee the preparation of accounting records required to be maintained
by the Fund. Assure that any audit of Fund records is coordinated and
completed timely;
(5) Direct the preparation of Fund Financial Statements and Footnotes.
Assure that all statements and disclosures are in accordance with
generally accepted accounting principles and that disclosures meet
current regulatory or accounting requirements;
(6) Assure that all distributions of the Fund meet the distribution and
excise tax requirements to assure qualification and to minimize taxes
paid by the Fund;
(7) Establish the tax policies and procedures for the Fund; maintain
procedures and policies with respect to tax matters; maintain tax
accounting records of the Fund; complete or review tax returns and
excise tax forms for the Fund; assist in preparing the 1099-DIV
information delivered to shareholders;
(8) Complete materials for the governing board of the Fund, including
materials for board meetings and in connection with the renewal of
investment advisory and distribution contracts;
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(9) Direct the accrual of Fund expenses; review and approve all invoices
submitted to the Fund; and
(10) Perform or arrange for the performance of all other Financial
Administration Services required of the Fund.
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Exhibit C
Legal Services
The Administrator shall provide the following Legal Services to each Fund:
A. Organizational Matters and Initial Registration. The Administrator shall
perform the following functions relating to the organization and initial
registration of the Fund:
o Draft and file with appropriate regulatory authorities the Fund's charter
documents;
o Draft, negotiate and file with appropriate regulatory authorities the
Fund's service contracts;
o Prepare and file the Fund's registration statement or other similar
registration documentation with appropriate regulatory authorities (the
"Registration Statement") and negotiate with such regulatory authorities;
and
o Otherwise arrange for and oversee registration and qualification of the
Fund's shares.
B. Ongoing Regulatory Filings, Reports and Meetings. The Administrator shall
perform the following functions relating to ongoing regulatory filings, reports
and meetings of the Fund:
o Prepare and file with appropriate regulatory authorities amendments to
the Fund's Registration Statement;
o Prepare and file with appropriate regulatory authorities supplements to
the Fund's prospectus and statement of additional information;
o Design and write documents or materials required to be prepared by or on
behalf of the Fund for distribution to shareholders of the Fund, the
Fund's governing board and officers and any governmental officers or
commissions as required of the Fund and not otherwise provided for under
this Agreement including, without limitation, prospectuses, shareholder
reports, shareholder notices and proxy statements;
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o Prepare and file or oversee preparation and review and provide legal
guidance on the Fund's annual, semi-annual and other periodic reports;
o Prepare and file or oversee preparation and provide legal guidance on the
Fund's tax filings and reports;
o Prepare and file with appropriate regulatory authorities the Fund's proxy
statement and negotiate with such regulatory authorities;
o Prepare and file with appropriate regulatory authorities various reports
in order to maintain the Fund's status in good standing;
o Arrange for shareholders' meetings;
o Prepare the Fund's representatives who will attend shareholder meetings
and all necessary materials in connection with such meetings including,
without limitation, a written script for such meetings, shareholder
minutes and any follow-up documents; and
o Attend shareholder meetings.
C. Securities Trading and Investment Practices. The Administrator shall perform
the following functions relating to the Fund's securities trading and investment
practices:
o Review and negotiate private placement and municipal securities offering
documentation and provide legal guidance on transfer restrictions;
o Provide guidance on legal considerations relating to the purchase of
foreign securities;
o Draft and negotiate documentation necessary to permit the Fund to engage
in a variety of derivative and securities trading practices and provide
legal guidance with respect to these practices;
o Negotiate the Fund's line of credit documentation; and
o Provide legal guidance on applicable laws regulating the types and levels
of ownership of securities by the Fund.
D. Regulated Activities. Applicable securities laws regulate numerous aspects of
the Fund's business, including such matters as the Fund's: prospectus
disclosure; investment activities; affiliated transactions; investment in senior
securities; sales,
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redemptions and exchanges; distribution of income and capital gains;
distribution of Fund shares; board composition; code of ethics; fidelity bond;
custodial services; and investment advisory and distribution contracts. The
Administrator will provide the Fund with legal guidance with respect to these
matters and to the general application of securities laws to the Fund's
business.
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E. Tax Considerations. The Administrator shall perform the following functions
relating to the application of tax rules to the Fund:
o Provide legal guidance with respect to the application of tax rules to
the Fund and analyze from a tax perspective new types of securities
purchased by the Fund, new investment practices engaged in by the Fund
and new investment products or practices adopted by the Fund; and
o Draft and/or review sections of the Fund's prospectus describing the tax
consequences of an investment in the Fund.
F. Board Considerations. The Administrator shall perform the following functions
with respect to the Fund's governing board:
o Provide advice concerning applicable rules governing the composition of
the Fund's governing board;
o Coordinate, prepare materials for and attend board and committee meetings
and coordinate any follow up issues; and
o Provide guidance and prepare materials on legal issues relevant to the
Fund's business.
G. Miscellaneous/Extraordinary Events. The Administrator shall perform the
following miscellaneous functions for the Fund:
o Provide legal guidance with respect to litigation brought by the Fund and
against the Fund and negotiate litigation settlements and pre-litigation
settlements and work-out arrangements;
o Obtain the required documentation to be filed in connection with any
lawsuits against the Fund and provide information or expertise on
administrative matters affecting such litigation;
o Provide legal guidance on alternative distribution structures for the
Fund's shares (such as the adoption of a multiple class structure);
o Review all contracts concerning the acquisition of other investment
companies or the liquidation of the Fund, draft, negotiate and file
various documentation required in connection therewith, provide guidance
on the manner such transactions should be structured to comply with
applicable law and obtain legal opinions and regulatory authority rulings
necessary for such transactions to comply with applicable law;
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o Seek formal guidance from regulatory authorities concerning the
application of various regulations to the Fund and seek exemptive relief
where appropriate; and
o Provide or arrange for all other Legal Services required of the Fund and
not otherwise provided for under this Agreement other than the services
of any counsel retained to represent the members of the governing boards
of the funds who are not "interested persons" of the Administrator or its
affiliates, as such term is defined in the Investment Company Act of
1940.
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Exhibit D
OTHER ADMINISTRATIVE SERVICES
The Administrator shall provide the following Other Administrative
Services to each Fund:
(1) Arrange for persons or other entities to serve as transfer agent,
registrar or dividend disbursing agent as required by the Fund;
(2) Arrange for a line of credit in the event of an unanticipated
redemption of shares;
(3) Arrange for consideration by the Board of appropriate or necessary
insurance coverage for the Fund;
(4) Subject to Section 4 hereof, perform or arrange for all compliance
functions required of the Fund;
(5) Prepare, and arrange for the printing and mailing of, any
necessary investment communications;
(6) Arrange for the printing and mailing of any documents or written
materials required to be prepared by or on behalf of the Fund
including, without limitation, stock certificates, prospectuses,
shareholder reports, shareholder notices, proxy statements and
reports to governmental officers and commissions;
(7) Arrange for any other printing, production and delivery services
required of the Fund and not otherwise provided for under this
Agreement;
(8) Provide a system of internal controls adequate to carry-out the
business of the Fund and arrange for the annual report on internal
controls of the Fund and its agents;
(9) Review the Fund's disclosure documents to ensure that disclosures
and policies conform to the Fund's actual operation; and
(10) Provide for the calculation and timely disbursement of appropriate
regulatory authority registration fees.
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Exhibit E
ADMINISTRATIVE FEE
The Administrative Fee shall be an amount, computed as set forth below,
designed to reimburse the Administrator for its actual costs (excluding costs of
staffing so-called residual matters as set forth in Exhibit #2 to Exhibit H to
the Memorandum to the Trustees of the Funds from Xxxxxxx X. Xxxxx and Xxxxxx X.
Xxxxx Xxxxx dated September 23, 1996 (Offshore Board) or October 1, 1996
(Compass, Crimson, Institutional Products and Red Boards)) for providing the
Financial Administration Services and Legal Services (the "Actual Costs") for
providing such services for a calendar year computed pursuant to the principles
set forth in such Exhibit H, subject to such changes in those principles as may
be agreed to from time to time by the Funds and the Administrator (the "Approved
Budgeted Costs"). In computing its Actual Costs, the Administrator will follow
the cost allocation principles set forth in the Deloitte & Touche LLP Report of
Independent Consultant dated November 29, 1996 under the caption "Review of MFS
Cost Reimbursement Methodologies", subject to such changes as may be agreed to
from time to time by the Funds and the Administrator.
The Approved Budgeted Costs shall be an amount from time to time agreed
to by the Funds and the Administrator with respect to a calendar year, provided
that, until Approved Budgeted Costs for a year are agreed to, the Approved
Budgeted Costs and Administrative Fee for the prior year shall remain in effect.
Subject to the adjustments required by the next paragraph, the
Administrative Fee with respect to a calendar year shall be computed by
allocating the Approved Budgeted Costs for that year among the Funds based on
each Fund's average daily net assets for its then-current fiscal year at rates
determined from time to time by the Funds and the Administrator.
In the event that the aggregate amount of all Administrative Fees
received by the Administrator with respect to a calendar year at any time equals
105% of the amount of the Approved Budgeted Costs for that year, no further
payments of Administrative Fees shall be made by the Funds to the Administrator
with respect to that year. In the event that the aggregate amount of the
Administrative Fees received by the Administrator with respect to a calendar
year is less than the amount of the Approved Budgeted Costs for that year, the
Administrator shall not be entitled to recovery of this shortfall during the
current calendar year; however, the amount of such shortfall will be taken into
account when establishing the Administrative Fee for following calendars years.
In the event that the aggregate amount of the Administrative Fees received by
the Administrator with respect to a calendar year is greater than the
Administrator's Actual Costs for that year, such excess fees shall be
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applied as a credit against the Administrative Fees payable by the Funds
hereunder with respect to the subsequent calendar year.
The Administrator will provide the Funds with such information as may
reasonably be required to review the Administrator's Actual Costs as of June 30
and December 31 in each year.
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