EXHIBIT 99.B9(b)
SUB-ADMINISTRATION AGREEMENT
October 21, 1996
Investors Bank & Trust Company
00 Xxxxx Xxxxxx
Xxxxxx, XX 00000
Ladies and Gentlemen:
This will confirm the agreement between Investors Bank & Trust Company
("IBT" or, at times, the "Sub-administrator") and Barclays Global Investors,
N.A. ("BGI" or, at times, the "Co-administrator") with respect to Master
Investment Portfolio ("MIP"), on behalf of its Master Portfolios, Managed Series
Investment Trust ("MSI Trust"), on behalf of its Master Portfolios, and
MasterWorks Funds Inc. ("MasterWorks"), on behalf of its Funds, listed in the
attached Appendix A, as such Appendix may be amended from time to time (the
"Master Portfolios" and Funds are, collectively, the "Portfolios"), as follows:
1. (a) MIP is a registered open-end, management investment company
consisting of a number of operating investment portfolios in accordance with
MIP's Amended and Restated Declaration of Trust (the "MIP Declaration"). MIP
engages in the business of investing and reinvesting the assets of each Master
Portfolio in the manner and in accordance with the applicable investment
objective, policies and restrictions specified in MIP's currently effective
Registration Statement, as amended from time to time (the "Registration
Statement"), filed under the Investment Company Act of 1940 (the "Act"). MIP
has retained BGI and Xxxxxxxx Inc. as co-administrators pursuant to a co-
administration agreement. Copies of MIP's agreements with all service
providers, the MIP Declaration, its By-Laws and most recent amendment to its
Registration Statement have been furnished to the Sub-administrator.
(b) MSI Trust is a registered open-end, management investment
company consisting of a number of operating investment portfolios in accordance
with MSI Trust's Declaration of Trust (the " MSI Trust Declaration"). MSI Trust
engages in the business of investing and reinvesting the assets of each Master
Portfolio in the manner and in accordance with the applicable investment
objective, policies and restrictions specified in MSI Trust's currently
effective Registration Statement, as amended from time to time, filed under the
Act. MSI Trust has retained BGI and Xxxxxxxx Inc. as co-administrators pursuant
to a co-administration agreement. Copies of MSI Trust's agreements with all
1
service providers, the MSI Trust Declaration, its By-Laws and most recent
amendment to its Registration Statement have been furnished to the Sub-
administrator.
(c) MasterWorks is a registered open-end, management investment
company consisting of a number of operating investment portfolios in accordance
with MasterWorks' Articles of Incorporation (the "Articles"). MasterWorks
engages in the business of investing and reinvesting the assets of each Fund in
the manner and in accordance with the applicable investment objective, policies
and restrictions specified in MasterWorks' currently effective Registration
Statement, as amended from time to time, filed under the Act and the Securities
Act of 1933. MasterWorks has retained BGI and Xxxxxxxx Inc. as co-administrators
pursuant to a co-administration agreement. Copies of MasterWorks' agreements
with all service providers, MasterWorks' Articles, its By-Laws and most recent
amendment to its Registration Statement and prospectuses and statements of
additional information thereto have been furnished to the Sub-administrator.
(d) Any amendments to MIP's, MSI Trust's or MasterWorks' documents
listed above shall be furnished to the Sub-administrator promptly.
2. BGI is engaging the Sub-administrator to provide certain administrative
services specified on Appendix B hereto, subject to the supervision of BGI and
the overall supervision of the applicable Board of Trustees/Directors of MIP,
MSI Trust or MasterWorks. Pursuant to advisory contracts between MIP, MSI Trust
or MasterWorks, respectively, and Barclays Global Fund Advisors (the "Adviser")
on behalf of each Master Portfolio or Fund, as applicable, the Adviser has been
engaged to manage the investing and reinvesting of the assets of each Master
Portfolio or Fund and to provide advisory services as specified in such advisory
contracts.
3. The Sub-administrator agrees to provide the administrative services, as
described on Appendix B hereto, as such Appendix may be amended from time to
time by the consent of the parties to this Agreement, in connection with the
operations of MIP, MSI Trust and MasterWorks and the Master Portfolios and
Funds, and to take all reasonable action in the performance of its obligations
under this Agreement to assure that the necessary information is made available
to other service providers, as such may be required by BGI from time to time.
4. (a) For the services to be rendered and the facilities to be furnished
by the Sub-administrator to BGI and/or MIP, MSI Trust, or MasterWorks, BGI
agrees to compensate the Sub-administrator in accordance with the fee schedule
attached as Appendix C to this Agreement. BGI also agrees to reimburse the Sub-
administrator for its out-of-pocket disbursements connected with the services
provided hereunder and for other expenses, which, with BGI's prior written
approval, the Sub-administrator shall be entitled to xxxx separately. The
compensation rates to be paid to the Sub-administrator
2
hereunder shall not be increased for a period of three (3) years from the
effective date of this Agreement.
(b) The Sub-administrator agrees that MIP, MSI Trust and MasterWorks
and their Master Portfolios and Funds shall have no obligation to
compensate the Sub-administrator for services provided or facilities
furnished under, or expenses incurred in connection with, this Agreement.
(c) The Sub-administrator shall have no obligation to pay for any
expenses incurred by MIP, MSI Trust and MasterWorks or their Master
Portfolios or Funds.
(d) The Sub-administrator and BGI each agree to exercise reasonable
care in performing its duties under this Agreement, and each party agrees
to be liable to the other party for direct damages resulting from a failure
to exercise reasonable care in performing such duties.
5. (a) BGI agrees to hold harmless and indemnify the Sub-administrator,
its directors, officers, employees and agents (the "Sub-administrator
Indemnitees") against and from any and all losses, expenses or liabilities
incurred by or claims or actions asserted against any Sub-administrator
Indemnitee to the extent resulting from (i) a violation or alleged
violation by BGI of any law, rule or regulation, (ii) a material violation
or alleged material violation by BGI of any provision of this Agreement,
(iii) any failure of BGI to exercise reasonable care in rendering services
hereunder, or (iv) any erroneous or incomplete information provided by or
through BGI to the Sub-administrator in connection with the Sub-
administrator's performance of its duties hereunder, such indemnification
to include any reasonable counsel fees and expenses incurred in connection
with investigating and/or defending such claims or actions.
(b) The Sub-administrator may apply to BGI at any time for instructions
and may consult counsel for BGI, or its own counsel, and with auditors and
other experts with respect to any matter arising in connection with its
duties hereunder, and the Sub-administrator shall not be liable or
accountable for any action reasonably taken or omitted by it in good faith
in accordance with such instruction, or with the opinion of such counsel,
auditors, or other experts. The Sub-administrator shall not be liable for
any action reasonably taken or omitted by it in good faith reliance upon
any document, certificate or instrument that it reasonably believes to be
genuine and to be signed or presented by the proper person(s). The Sub-
administrator shall not be held to have notice of any change of authority
of any officers, employees or agents of MIP, MSI Trust or MasterWorks or
their Master Portfolios or Funds until the Sub-administrator has
3
received written notice thereof from BGI.
(c) The Sub-administrator agrees to hold harmless and indemnify BGI,
MIP, MSI Trust and MasterWorks and their Master Portfolios and Funds,
including any principals, directors or trustees, officers, and employees
(the "BGI Indemnitees") against and from any and all losses, expenses or
liabilities incurred by or claims or actions asserted against any BGI
Indemnitee to the extent resulting from a violation or alleged violation by
the Sub-administrator of any law, rule or regulation or material violation
or alleged material violation by the Sub-administrator of any provision of
this Agreement, or any failure of the Sub-administrator to exercise
reasonable care in rendering services hereunder, such indemnification to
include any reasonable counsel fees and expenses incurred in connection
with investigating of defending such claims or actions.
(d) In the event that the Sub-administrator is unable to perform, or is
delayed in performing, its obligations under the terms of this Agreement
because of acts of God, strikes, legal constraint, government actions, war,
emergency conditions, interruption of electrical power or other utilities,
equipment or transmission failure or damage reasonably beyond its control
or other causes reasonably beyond its control, the Sub-administrator shall
not be liable to BGI for any damages resulting from such failure to
perform, delay in performance, or otherwise from such causes, provided that
the Sub-administrator shall make all reasonable efforts, whenever
necessary, to use data processing back-up facilities provided by Electronic
Data Systems, Inc.
(e) In no event shall the Sub-administrator be liable for special,
incidental, or consequential damages, even if advised in advance of the
possibility of such damages.
(f) In no event shall either BGI or the Sub-administrator be liable to
the other party for actions taken or omitted or information provided that
is based upon information originally provided by such other party.
6. The term of this Agreement shall be two (2) years commencing upon the
date hereof (the "Initial Term"), unless earlier terminated as provided herein.
After the expiration of the Initial Term, this Agreement shall automatically
renew for successive one-year terms (each a "Renewal Term") unless notice of
non-renewal is delivered by the non-renewing party to the other party no later
than sixty (60) days prior to the expiration of the Initial Term or any Renewal
Term, as the case may be.
(a) Either party hereto may terminate this Agreement prior to the
expiration of the Initial Term in the event the other party violates any
material provision of this Agreement, provided that the violating party
does not cure such
4
violation within ninety (90) days of receipt of written notice from the
non-violating party of such violation.
(b) BGI may terminate this Agreement prior to the expiration of the
Initial Term in the event (i) the Board of Trustees/Directors of MIP, MSI
Trust or MasterWorks determines that the performance of the Sub-
Administrator does not meet the reasonable satisfaction (considered in
light of industry standards) of the Board of Trustees/Directors, provided
that the Sub-Administrator does not cure such unsatisfactory performance
within ninety (90) days of receipt of written notice specifying such
unsatisfactory performance; or (ii) if the Sub-administrator becomes the
subject of any state or federal bankruptcy proceeding which is not
dismissed within sixty (60) days of the initiation of such proceeding.
(c) Either party may terminate this Agreement during any Renewal Term
upon sixty (60) days written notice to the other party. Any termination
pursuant to this paragraph 6(b) shall be effective upon expiration of such
sixty (60) days, provided, however, that the effective date of such
termination may be postponed, at the request of BGI, to a date not more
than ninety (90) days after delivery of the written notice in order to give
BGI an opportunity to make suitable arrangements for a successor Sub-
administrator.
(d) At any time after the termination of this Agreement, BGI may, upon
written request, have reasonable access to the records of Sub-administrator
relating to its performance of its duties as Sub-administrator.
(e) BGI may terminate this Agreement if the Co-administration
Agreement between BGI and MIP, MSI Trust or MasterWorks is terminated and
no successor agreement between BGI and MIP, MSI Trust or MasterWorks for
the provision of administrative services is subsequently executed within 90
days after the termination of the Co-administration Agreement.
(f) Section 5 hereof shall survive any termination of this Agreement.
7. (a) Any notice or other instrument authorized or required by this
Agreement to be given in writing to BGI or the Sub-administrator shall be
sufficiently given if addressed to that party and received by it at its office
set forth below or at such other place as it may from time to time designate in
writing.
To BGI: Barclays Global Investors, N.A.
00 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Legal Group
5
To the Sub-administrator: Investors Bank & Trust Company
00 Xxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Xxxxxx Xxxxxx
With a copy to: Xxxx X. Xxxxx, Esq.
(b) This Agreement shall extend to and shall be binding upon the
parties hereto and their respective successors and assigns; provided,
however, that this Agreement shall not be assignable without the written
consent of the other party.
8. This Agreement shall be construed in accordance with the laws of the
Commonwealth of Massachusetts.
9. BGI and the Sub-administrator agree that each party may disclose the
existence of this Agreement to third parties; provided that each agrees to keep
confidential all proprietary data, software, processes, information, and
documentation related to this Agreement, except as may be necessary to perform
obligations under this Agreement or otherwise as may be agreed to, from time to
time, in writing by the parties.
10. Neither the Sub-administrator nor any of its employees or agents are
authorized to make any representation concerning the interests of MIP, MSI
Trust, MasterWorks or their Master Portfolios or Funds without prior written
consent, except those contained in the then current Registration Statement or
applicable prospectuses and statements of additional information, copies of
which will be supplied to the Sub-administrator as described above; and the Sub-
administrator shall have no authority under this Agreement to act as agent for
MIP, MSI Trust, or MasterWorks or their Master Portfolios or Funds or for BGI,
except where necessary to perform specific services under this Agreement.
11. This Agreement may be amended only by a written instrument executed by
both BGI and the Sub-administrator.
12. This Agreement may be executed in any number of counterparts, each of
which shall be deemed to be an original, but such counterparts shall, together,
constitute only one instrument.
6
If the foregoing correctly sets forth the agreement between BGI and the
Sub-administrator, please so indicate by signing and returning to BGI the
enclosed copy hereof.
Very truly yours,
BARCLAYS GLOBAL INVESTORS, N.A.,
By: /s/Xxxxxx Xxxxxx
-------------------------------
Name: Xxxxxx Xxxxxx
Title: Vice Chairman
By: /s/Xxxxxxx Xxxxxxx
-------------------------------
Name: Xxxxxxx Xxxxxxx
Title: Principal
ACCEPTED as of the date
set forth above:
INVESTORS BANK & TRUST
By: /s/Xxxxxx X. Xxxxxxx
-----------------------------
Name: Xxxxxx X. Xxxxxxx,
Title: Managing Director
By: /s/Xxxx X. Xxxxx
-----------------------------
Name: Xxxx X. Xxxxx,
Title: General Counsel
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Appendix A
Master Investment Portfolio
---------------------------
LifePath 2000 Master Portfolio
LifePath 2010 Master Portfolio
LifePath 2020 Master Portfolio
LifePath 2030 Master Portfolio
LifePath 2040 Master Portfolio
Asset Allocation Master Portfolio
Bond Index Master Portfolio
S & P 500 Index Master Portfolio
U.S. Treasury Allocation Master Portfolio
Money Market Master Portfolio
Extended Index Master Portfolio
U.S. Equity Index Master Portfolio
Managed Series Investment Trust
-------------------------------
Growth Stock Master Portfolio
Short-Intermediate Term Master Portfolio
MasterWorks Funds, Inc.
-----------------------
LifePath 2000 Fund
LifePath 2010 Fund
LifePath 2020 Fund
LifePath 2030 Fund
LifePath 2040 Fund
Asset Allocation Fund
Bond Index Fund
Growth Stock Fund
Money Market Fund
S&P 500 Index Fund
Short-Intermediate Term Fund
U.S. Treasury Allocation Fund
Dated: October 21, 0000
X-0
Xxxxxxxx X
LIST OF ADMINISTRATIVE SERVICES
-------------------------------
(1) Prepare selected portfolio and financial information for inclusion in Board
material
(2) Assist in presentation to Board as desired by Fund Officer(s);
(3) Calculate total return information and other statistical information
including undistributed income and capital gains with respect to condensed
financial information for review by management;
(4) Perform tests of specific portfolio activities against compliance
checklists designed from the provisions of the Masters' and Money Market
Fund's current Prospectus and SAI;
(5) Calculate dividend amounts available for distribution;
(6) Coordinate review of dividend amounts by management and auditors;
(7) Notify fund accounting and transfer agent of authorized dividends rates;
(8) Prepare responses to various performance questionnaires; coordinate as
necessary, and submit responses to the appropriate agency;
(9) Prepare Forms N-SAR for filing; obtain any necessary supporting documents;
file with the SEC via XXXXX;
(10) Draft semi-annual and annual shareholder reports and coordinate auditor and
management review;
(11) Coordinate printing of reports and XXXXX conversion with outside printer
and filing with the SEC via XXXXX;
(12) Provide information for Financial Highlights and expense tables;
(13) Coordinate the preparation of required reports and confirmations for audit
packages with IBT fund accounting.
(14) Assist in resolution of audit issues.
(15) Perform diversification testing pursuant to the Internal Revenue Code of
1986, as amended (the "Tax Code") -- preliminary at each month end, final
at quarter end, and as may otherwise be necessary. Follow-up on any issues
until Tax Code qualification issues are resolved.
B-1
(16) Perform short-short income and qualifying income tests monthly or more
frequently, as test results dictate, with respect to qualification as a
regulated investment company under the Tax Code.
(17) Identify book-tax accounting differences with auditors and management.
(18) Track required information relating to accounting differences and determine
appropriate allocations to feeders.
(19) Follow appropriate Tax Code treatment for all passive foreign investment
company ("PFIC") lots identified by BGI.
Approved: October 21, 1996
Signed: /s/Xxxxxx Xxxxxx Signed: /s/Xxxxxx X. Mncuso
----------------------- --------------------------
By: Xxxxxx Xxxxxx, Vice Chairman By: Xxxxxx X. Xxxxxxx, Managing Director
Barclays Global Investors, N.A. Investors Bank & Trust
Signed: /s/Xxxxxxx Xxxxxxx Signed: /s/Xxxx X. Xxxxx
----------------------- ---------------------------
By: Xxxxxxx Xxxxxxx, Principal By: Xxxx X. Xxxxx, General Counsel
Barclays Global Investors, N.A. Investors Bank & Trust
B-2
Appendix C
FEE SCHEDULE
------------
CUSTODY, FUND ACCOUNTING & CALCULATION OF X.X.X.
X. Fund Accounting and Calculation of N.A.V
----------------------------------------
The following annual fee will be charged for each Master Portfolio of MIP and
MSI Trust and stand-alone Fund of MasterWorks for which IBT serves as fund
accountant. This fee does not include domestic or global custody or
transaction costs.
Annual Fee
----------
Domestic Funds $25,000
International/Foreign Funds $40,000
Per Feeder Annual Charge $12,000
B. Domestic Custody and Transactions**
---------------------------------
In addition to the transaction charges below, there will be a basis point
charge on all domestic assets that IBT is custodian as follows:
For all assets .67 basis point
Transactions Charges
------------ -------
. DTC $ 4
. Fed Book Entry $ 5
. Physical Securities 35
. Options and Futures 18
. GNMA Securities 40
. Principal Paydown 5
. Foreign Currency 18***
. Cross Border 50
. Outgoing Wires 7
. Incoming Wires 5
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**Trade information will be sent to IBT electronically. If the trades are not
sent electronically, the price per trade for DTC and Fed Book items will
increase to $12 per trade.
***There are no transaction charges for F/X contracts executed by IBT.
C. Global Custody:
--------------
. Incremental basis point and transaction fees will be charged for all
foreign assets for which IBT serves as custodian. The asset based fees
and transaction fees vary by country, based upon the attached global
custody fee schedule. Local duties, script fees, registration, exchange
fees, and other market charges are out-of-pocket.
. IBT will require international assets to be held within its international
custody network.
MUTUAL FUND ADMINISTRATION
A. Mutual Fund Administration
--------------------------
. The following basis point fees are based on all assets for which IBT
serves as Administrator. This fee does not include preparation of tax
returns and provisions.
Annual Fee
----------
First $1 billion of assets $2.75 Basis Points
Assets in excess of $1 billion 1.0 Basis Point
. For any new funds beyond the existing 1 stand-alone fund, 11 master
portfolios and 11 feeder funds there will be a minimum fee as described
below.
First 6 months $10,000
Next 6 months $12,500
Each Year thereafter $35,000
This minimum fee includes 1 master portfolios and 1 feeder fund or stand-
alone fund. Each additional feeder will be charged a yearly minimum fee
of $7,500.
C-2
The minimum fees will apply until the basis point fee above exceeds the
minimum charge.
MISCELLANEOUS
A. Out-of-Pocket
-------------
. These charges consist of:
- Printing, Delivery & Postage
- Board Meeting Attendance
- Extraordinary Travel Expenses
- InvestView
- Legal Expenses
- Customized Systems Development/Reporting
- Pricing & Verification Services (Per day/issue; Bonds $.50, Stocks $.03)
- Int'l stocks and bonds $.40; Int'l corporate actions $3.00 per
month/issue.
B. Domestic Balance Credit
-----------------------
. IBT allows use of balance credit against fees (excluding out-of-pocket
charges) for fund balances arising out of the custody relationship. The
credit is based on collected balances reduced by balances required to
support the activity charges of the accounts. The monthly earnings
allowance is equal to 75% of the 90-day T-xxxx rate.
C. Securities Lending, Foreign Exchange & Cash Management
------------------------------------------------------
. This proposal is based upon IBT performing securities lending, foreign
exchange and cash management for the portfolios. Securities Lending
revenue is split between a master portfolio or a fund and IBT on a 60/40%
basis; 60% going to the master portfolio or fund.
D. Payment
-------
. An invoice with respect to the above fees will be sent to BGI and will be
payable within ten (10) business days after the invoice is received.
C-3
E. Systems
-------
. The details of any systems work will be determined after a thorough
business analysis. System's work will be billed on a time and material
basis.
F. Legal & Audit Expertise
-----------------------
. IBT will rely on the outside counsel to MIP, MSI Trust and MasterWorks and
auditors for opinions on any structural changes to the master portfolios
or funds.
* This fee schedule is valid for the time frames described in the
individual contracts.
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-----------------------------------------------------------------
Country BP Charge Trade Charge
-----------------------------------------------------------------
Argentina 22.00 $ 75.00
Australia 5.00 $ 60.00
Austria 7.00 $ 60.00
Bangladesh 41.00 $150.00
Belgium 7.00 $ 60.00
Bharain 41.00 $140.00
Botswana 50.00 $175.00
Brazil** 29.00 $ 80.00
Canada 5.00 $ 30.00
Chile*** 45.00 $100.00
China 20.00 $ 75.00
Colombia** 45.00 $140.00
Cyprus 50.00 $150.00
Czech Republic 20.00 $ 75.00
Denmark 5.00 $ 60.00
Ecuador 45.00 $100.00
Egypt 41.00 $100.00
Euroclear-Eurobonds 5.00 $ 20.00
Euroclear Non-Eurobond Issues 5.00 $ 60.00
Finland 7.00 $ 70.00
France 5.00 $ 60.00
France Debt 5.00 $ 60.00
Germany 5.00 $ 30.00
Ghana 50.00 $200.00
Greece 45.00 $130.00
Hong Kong 10.00 $ 65.00
Hungary 50.00 $200.00
India**** 50.00 .00XX
Xxxxxxxxx 13.00 $ 65.00
Ireland 7.00 $ 60.00
Israel 50.00 $150.00
Italy Debt 5.00 $ 50.00
Italy Equity 5.00 $ 50.00
Japan 5.00 $ 30.00
Jordan 41.00 $120.00
Kenya 50.00 $200.00
Korea 13.00 $ 65.00
Lebanon 41.00 $140.00
Luxembourg 7.00 $ 60.00
Malaysia 10.00 $ 70.00
Mauritius 41.00 $140.00
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-----------------------------------------------------------------
Country BP Charge Trade Charge
-----------------------------------------------------------------
Mexico 10.00 $ 40.00
Morocco 40.00 $150.00
Namibia 50.00 $200.00
Netherlands 5.00 $ 40.00
New Zealand 5.00 $ 60.00
Norway 7.00 $ 90.00
Oman 41.00 $140.00
Pakistan 41.00 $140.00
Peru 50.00 $150.00
Philippines 13.00 $ 65.00
Poland 50.00 $150.00
Poland T Bills 29.00 $110.00
Portugal 20.00 $125.00
Russia Equities 41.00 $250.00
Russia Min Fins 35.00 $140.00
Singapore 10.00 $ 65.00
Slovakia 20.00 $ 75.00
South Africa 7.00 $ 40.00
Spain Eq & Corp. Debt 7.00 $ 60.00
Spain Gvt Debt 5.00 $ 60.00
Sri Lanka 13.00 $ 65.00
Swaziland 50.00 $200.00
Sweden 5.00 $ 40.00
Sweden Debt 5.00 $ 40.00
Switzerland 5.00 $ 60.00
Taiwan 13.00 $ 65.00
Thailand 10.00 $ 65.00
Turkey 41.00 $140.00
UK 5.00 $ 50.00
Uruguay 50.00 $150.00
Venezuela** 45.00 $140.00
Zambia 50.00 $200.00
Zimbabwe 50.00 $175.00
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*Bonds billed at Residual Value
**Local Administrator Fees included in Custody fee
***20 BP Local Administration Charge Applied to Trades
****Trades billed at 50 BP
Out-of-Pocket Charges are passed through as actuals in all markets
Dated: October 21, 1996
C-7
