FUND SUB-ADMINISTRATION SERVICING AGREEMENT
THIS AGREEMENT is made and entered into as of this 6th day of February,
2001, by and between Gintel Fund, a Massachusetts business trust under the laws
of the State of Massachusetts (the "Fund") and Firstar Mutual Fund Services,
LLC, a limited liability company organized under the laws of the State of
Wisconsin ("FMFS").
WHEREAS, the Fund is an open-end management investment company which is
registered under the Investment Company Act of 1940, as amended (the "1940
Act");
WHEREAS, the Fund is authorized to create separate series, each with its
own separate investment portfolio;
WHEREAS, FMFS is a limited liability company and, among other things, is in
the business of providing fund administration services for the benefit of its
customers; and
WHEREAS, the Fund desires to retain FMFS to act as Sub-Administrator
for each series of the Fund listed on Exhibit A attached hereto, (each
hereinafter referred to as a "Fund"), as may be amended from time to time.
NOW, THEREFORE, in consideration of the mutual agreements herein made, the
Fund and FMFS agree as follows:
1. Appointment of Sub-Administrator
The Fund hereby appoints FMFS as Sub-Administrator of the Fund on the terms
and conditions set forth in this Agreement, and FMFS hereby accepts such
appointment and agrees to perform the services and duties set forth in this
Agreement in consideration of the compensation provided for herein.
2. Duties and Responsibilities of FMFS
A. General Fund Management
(1) Act as liaison among all Fund service providers
(2) Supply:
a. Corporate secretarial services
b. Office facilities (which may be in FMFS's or its affiliate's
own offices)
c. Non-investment-related statistical and research data as
needed
(3) Coordinate board communication by:
a. Establish meeting agendas
b. Preparing board reports based on financial and
administrative data
c. Evaluating independent auditor
d. Securing and monitoring fidelity bond and director and
officer liability coverage, and making the necessary SEC
filings relating thereto
e. Preparing minutes of meetings of the board and shareholders
f. Recommend dividend declarations to the Board, prepare and
distribute to appropriate parties notices announcing
declaration of dividends and other distributions to
shareholders
g. Provide personnel to serve as officers of the Fund if so
elected by the Board and attend Board meetings to present
materials for Board review
(4) Audits
a. Prepare appropriate schedules and assist independent
auditors b. Provide information to SEC and facilitate audit
process c. Provide office facilities
(5) Assist in overall operations of the Fund
(6) Pay Fund expenses upon written authorization from the Fund
(7) Monitor arrangements under shareholder services or similar plan
B. Compliance
(1) Regulatory Compliance
a. Monitor compliance with 1940 Act requirements, including:
(i) Asset diversification tests
(ii) Total return and SEC yield calculations
(iii) Maintenance of books and records under Rule 31a-3
(iv) Code of Ethics for the disinterested Directors of the
Fund
b. Monitor Fund's compliance with the policies and investment
limitations of the Fund as set forth in its Prospectus and
Statement of Additional Information
c. Maintain awareness of applicable regulatory and operational
service issues and recommend dispositions
(2) Blue Sky Compliance
a. Prepare and file with the appropriate state securities
authorities any and all required compliance filings relating
to the registration of the securities of the Fund so as to
enable the Fund to make a continuous offering of its shares
in all states
b. Monitor status and maintain registrations in each state
c. Provide information regarding material developments in state
securities regulation
(3) SEC Registration and Reporting
a. Assist Corporate counsel in updating Prospectus and
Statement of Additional Information and in preparing proxy
statements and Rule 24f-2 notices
b. Prepare annual and semiannual reports, Form N-SAR filings
and Rule 24f-2 notices
c. Coordinate the printing, filing and mailing of publicly
disseminated Prospectuses and reports
d. File fidelity bond under Rule 17g-1
e. File shareholder reports under Rule 30b2-1
f. Monitor sales of each Fund's shares and ensure that such
shares are properly registered with the SEC and the
appropriate state authorities
g. File Rule 24f-2 notices
(4) IRS Compliance
a. Monitor Company's status as a regulated investment company
under Subchapter M, including without limitation, review of
the following:
(i) Asset diversification requirements
(ii) Qualifying income requirements
(iii) Distribution requirements
b. Calculate required distributions (including excise tax
distributions)
C. Financial Reporting
(1) Provide financial data required by Fund's Prospectus and
Statement of Additional Information;
(2) Prepare financial reports for officers, shareholders, tax
authorities, performance reporting companies, the board, the SEC,
and independent auditors;
(3) Supervise the Fund's Custodian and Fund Accountants in the
maintenance of the Fund's general ledger and in the preparation
of the Fund's financial statements, including oversight of
expense accruals and payments, of the determination of net asset
value of the Fund's net assets and of the Fund's shares, and of
the declaration and payment of dividends and other distributions
to shareholders;
(4) Compute the yield, total return and expense ratio of each class
of each Fund, and each Fund's portfolio turnover rate; and
(5) Monitor the expense accruals and notify Fund management of any
proposed adjustments.
(6) Prepare monthly financial statements, which will include without
limitation the following items:
- Schedule of Investments
- Statement of Assets and Liabilities
- Statement of Operations
- Statement of Changes in Net Assets
- Cash Statement
- Schedule of Capital Gains and Losses
(7) Prepare quarterly broker security transaction summaries.
D. Tax Reporting
(1) Prepare and file on a timely basis appropriate federal and state
tax returns including, without limitation, Forms 1120/8610 with
any necessary schedules
(2) Prepare state income breakdowns where relevant
(3) File Form 1099 Miscellaneous for payments to Directors and other
service providers
(4) Monitor wash losses
(5) Calculate eligible dividend income for corporate shareholders
3. Compensation
The Fund, on behalf of the Fund, agrees to pay FMFS for the performance of
the duties listed in this Agreement, the fees and out-of-pocket expenses as set
forth in the attached Exhibit A. Notwithstanding anything to the contrary,
amounts owed by the Fund to FMFS shall only be paid out of the assets and
property of the particular Fund involved.
These fees may be changed from time to time, subject to mutual written
Agreement between the Fund and FMFS.
The Fund agrees to pay all fees and reimbursable expenses within ten (10)
business days following the receipt of the billing notice.
4. Performance of Service; Limitation of Liability
A. FMFS shall exercise reasonable care in the performance of its duties
under this Agreement. FMFS shall not be liable for any error of
judgment or mistake of law or for any loss suffered by the Fund in
connection with matters to which this Agreement relates, including
losses resulting from mechanical breakdowns or the failure of
communication or power supplies beyond FMFS's control, except a loss
arising out of or relating to FMFS's refusal or failure to comply with
the terms of this Agreement or from bad faith, negligence, or willful
misconduct on its part in the performance of its duties under this
Agreement. Notwithstanding any other provision of this Agreement, if
FMFS has exercised reasonable care in the performance of its duties
under this Agreement, the Fund shall indemnify and hold harmless FMFS
from and against any and all claims, demands, losses, expenses, and
liabilities (whether with or without basis in fact or law) of any and
every nature (including reasonable attorneys' fees) which FMFS may
sustain or incur or which may be asserted against FMFS by any person
arising out of any action taken or omitted to be taken by it in
performing the services hereunder, except for any and all claims,
demands, losses, expenses, and liabilities arising out of or relating
to FMFS's refusal or failure to comply with the terms of this
Agreement or from bad faith, negligence or from willful misconduct on
its part in performance of its duties under this Agreement, (i) in
accordance with the foregoing standards, or (ii) in reliance upon any
written or oral instruction provided to FMFS by any duly authorized
officer of the Fund, such duly authorized officer to be included in a
list of authorized officers furnished to FMFS and as amended from time
to time in writing by resolution of the Board of Directors of the
Fund.
FMFS shall indemnify and hold the Fund harmless from and against
any and all claims, demands, losses, expenses, and liabilities
(whether with or without basis in fact or law) of any and every nature
(including reasonable attorneys' fees) which the Fund may sustain or
incur or which may be asserted against the Fund by any person arising
out of any action taken or omitted to be taken by FMFS as a result of
FMFS's refusal or failure to comply with the terms of this Agreement,
its bad faith, negligence, or willful misconduct.
In the event of a mechanical breakdown or failure of
communication or power supplies beyond its control, FMFS shall take
all reasonable steps to minimize service interruptions for any period
that such interruption continues beyond FMFS's control. FMFS will make
every reasonable effort to restore any lost or damaged data and
correct any errors resulting from such a breakdown at the expense of
FMFS. FMFS agrees that it shall, at all times, have reasonable
contingency plans with appropriate parties, making reasonable
provision for emergency use of electrical data processing equipment to
the extent appropriate equipment is available. Representatives of the
Fund shall be entitled to inspect FMFS's premises and operating
capabilities at any time during regular business hours of FMFS, upon
reasonable notice to FMFS.
Regardless of the above, FMFS reserves the right to reprocess and
correct administrative errors at its own expense.
B. In order that the indemnification provisions contained in this section
shall apply, it is understood that if in any case the indemnitor may
be asked to indemnify or hold the indemnitee harmless, the indemnitor
shall be fully and promptly advised of all pertinent facts concerning
the situation in question, and it is further understood that the
indemnitee will use all reasonable care to notify the indemnitor
promptly concerning any situation which presents or appears likely to
present the probability of a claim for indemnification. The indemnitor
shall have the option to defend the indemnitee against any claim which
may be the subject of this indemnification. In the event that the
indemnitor so elects, it will so notify the indemnitee and thereupon
the indemnitor shall take over complete defense of the claim, and the
indemnitee shall in such situation initiate no further legal or other
expenses for which it shall seek indemnification under this section.
The indemnitee shall in no case confess any claim or make any
compromise in any case in which the indemnitor will be asked to
indemnify the indemnitee except with the indemnitor's prior written
consent.
C. FMFS is hereby expressly put on notice of the limitation of
shareholder liability as set forth in the Fund's Articles of InFund
and agrees that obligations assumed by the Fund pursuant to this
Agreement shall be limited in all cases to the Fund and its assets,
and if the liability relates to one or more series, the obligations
hereunder shall be limited to the respective assets of such series.
FMFS further agrees that it shall not seek satisfaction of any such
obligation from the shareholder or any individual shareholder of a
series of the Fund, nor from the Directors or any individual Director
of the Fund.
5. Proprietary and Confidential Information
FMFS agrees on behalf of itself and its directors, officers, and employees
to treat confidentially and as proprietary information of the Fund all records
and other information relative to the Fund and prior, present, or potential
shareholders of the Fund (and clients of said shareholders), and not to use such
records and information for any purpose other than the performance of its
responsibilities and duties hereunder, except after prior notification to and
approval in writing by the Fund, which approval shall not be unreasonably
withheld and may not be withheld where FMFS may be exposed to civil or criminal
contempt proceedings for failure to comply, when requested to divulge such
information by duly constituted authorities, or when so requested by the Fund.
6. Term of Agreement
This Agreement shall become effective as of the date hereof and will
continue in effect for a period of three years. Subsequent to the initial
three-year term, this Agreement may be terminated by either party upon giving
ninety (90) days prior written notice to the other party or such shorter period
as is mutually agreed upon by the parties. However, this Agreement may be
amended by mutual written consent of the parties.
7. Records
FMFS shall keep records relating to the services to be performed hereunder,
in the form and manner, and for such period as it may deem advisable and is
agreeable to the Fund but not inconsistent with the rules and regulations of
appropriate government authorities, in particular, Section 31 of the 1940 Act
and the rules thereunder. FMFS agrees that all such records prepared or
maintained by FMFS relating to the services to be performed by FMFS hereunder
are the property of the Fund and will be preserved, maintained, and made
available in accordance with such section and rules of the 1940 Act and will be
promptly surrendered to the Fund on and in accordance with its request.
8. Governing Law
This Agreement shall be construed and the provisions thereof interpreted
under and in accordance with the laws of the State of Wisconsin. However,
nothing herein shall be construed in a manner inconsistent with the 1940 Act or
any rule or regulation promulgated by the Securities and Exchange Commission
thereunder.
9. Duties in the Event of Termination
In the event that, in connection with termination, a successor to any of
FMFS's duties or responsibilities hereunder is designated by the Fund by written
notice to FMFS, FMFS will promptly, upon such termination and at the expense of
the Fund, transfer to such successor all relevant books, records,
correspondence, and other data established or maintained by FMFS under this
Agreement in a form reasonably acceptable to the Fund (if such form differs from
the form in which FMFS has maintained, the Fund shall pay any expenses
associated with transferring the data to such form), and will cooperate in the
transfer of such duties and responsibilities, including provision for assistance
from FMFS's personnel in the establishment of books, records, and other data by
such successor.
10. No Agency Relationship
Nothing herein contained shall be deemed to authorize or empower FMFS to
act as agent for the other party to this Agreement, or to conduct business in
the name of, or for the account of the other party to this Agreement.
11. Data Necessary to Perform Services
The Fund or its agent, which may be FMFS, shall furnish to FMFS the data
necessary to perform the services described herein at times and in such form as
mutually agreed upon if FMFS is also acting in another capacity for the Fund,
nothing herein shall be deemed to relieve FMFS of any of its obligations in such
capacity.
12. Notices
Notices of any kind to be given by either party to the other party shall be
in writing and shall be duly given if mailed or delivered as follows: Notice to
FMFS shall be sent to:
Firstar Mutual Fund Services, LLC
000 Xxxx Xxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
and notice to the Fund shall be sent to:
Gintel & Co., LLC
0 Xxxxxxxxx Xxxxxx Xxxx
Xxxxxxxxx, XX 00000-0000
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by a duly authorized officer or one or more counterparts as of the day
and year first written above.
Gintel Group FIRSTAR MUTUAL FUND SERVICES, LLC
By:______________________________ By: ________________________________
Title:__________________________ Title:______________________________
