ADMINISTRATION AGREEMENT
AGREEMENT made as of the 1st day of July, 1994, by and between KPM
Funds, Inc., a Nebraska corporation, having its principal office and place of
business at Omaha, Nebraska (the "Fund"), and XXXXX XXXXX Portfolio Management,
Inc., a Nebraska corporation, having its principal office and place of business
at Lincoln, Nebraska (the "Administrator"),
WHEREAS, the Fund desires to engage the Administrator to provide
transfer agent, dividend disbursing agent, fund accounting and related fund
administration services.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, the parties hereto agree as follows:
Section 1. Terms of Appointment.
1.01 Subject to the conditions set forth in this Agreement, the Fund
hereby employs and appoints Administrator as the Fund's Administrator, Transfer
Agent and Dividend Disbursing Agent for all portfolios ("Portfolios") of the
Fund now existing or hereafter created and registered under the Investment
Company Act of 1940 ("1940 Act").
1.02 Administrator hereby accepts such employment and appointment and
agrees to act as the Fund's Administrator, Transfer Agent and Dividend
Disbursing Agent. Administrator agrees that it will also act as agent in
connection with any periodic investment plan, periodic withdrawal program or
other accumulation, open-account or similar plans provided to the Fund's
shareholders and set out in the Fund's prospectus.
1.03 Administrator agrees to provide the necessary facilities,
equipment and personnel to perform its duties and obligations hereunder in
accordance with industry practice.
1.04 Administrator agrees that it will perform all of the usual and
ordinary services as Transfer Administrator and Dividend Disbursing
Administrator and as agent for the various shareholder accounts including but
not limited to: recording the issuance, transfer and redemption of shares,
maintaining all shareholder accounts, preparing annual shareholder meeting
lists, mailing proxies, receiving and tabulating proxies, mailing shareholder
reports and prospectuses, withholding taxes on non-resident alien accounts,
disbursing income dividends and capital gains distributions, recording
reinvestment of dividends and distributions in Fund shares, causing liquidation
of shares and causing disbursements to be made to withdrawal plan holders.
1.05 Administrator agrees that it will furnish the Fund with office
facilities, including such space, furniture, equipment and supplies as well as
personnel sufficient to carry out the necessary administrative, clerical, fund
accounting and bookkeeping functions of the Fund. In connection therewith, the
Administrator shall maintain all records required to be maintained for the Fund
under the Investment Company Act of 1940. Additionally, the Administrator shall
provide the following services to the Fund:
i. Daily pricing;
ii. Computation of daily net asset value and reporting to Fund
management, and others as requested;
iii. Prepare daily cash availability reports for Portfolio managers;
iv. Post daily all fund activity and prepare all applicable daily
reports;
v. Accrue expenses daily;
vi. Calculate daily reconciliations of cash, receivables, payable
accounts and shares outstanding;
vii. Compute daily dividend rate for appropriate funds;
viii. Compute yields pursuant to S.E.C. formulas;
ix. Provide monthly analysis and reconciliation of all general
ledger accounts;
x. Generate and maintain monthly broker ledgers, commission
ledgers and net trade reports;
xi. Verify accuracy and propriety of bills and invoices, maintain
expenses files and coordinate payment of bills and invoices in
a timely manner;
xii. Prepare reports on expense limitations as needed;
xiii. Maintain and verify Portfolio trade tickets with broker
confirmation;
xiv. Determine income availability for monthly, quarterly and/or
annual dividend/distributions;
xv. Maintain historical record of all Fund net asset values and
dividend/distributions;
xvi. Coordinate audit examination of outside auditors, including
preparation of audit work paper package if required; and
xvii. Produce documents and respond to inquiries during S.E.C.
audits.
Section 2. Fees and Expenses.
2.01 For the services to be rendered by Administrator pursuant to
paragraph 1.04 and 1.05 the Fund agrees to pay Administrator a monthly fee
calculated at the annual rate of each Portfolio's average daily net assets set
forth on Appendix A, attached hereto and incorporated by reference herein.
2.02 The Fund also agrees promptly to reimburse Administrator for all
reasonable out-of-pocket expenses or advances incurred by Administrator in
connection with the performance of services under this Agreement including, but
not limited to, expenditures for counsel fees, postage, envelopes, checks,
drafts, continuous forms, reports and statements, telephone, telegraph,
stationery, supplies, costs of outside mailing firms, record storage costs and
media for storage of records (e.g. microfilm, computer tapes or disks). In
addition, any other expenses incurred by Administrator at the request or with
the consent of the Fund will be promptly reimbursed by the Fund.
Section 3. Representations and Warranties of Administrator.
Administrator represents and warrants to the Fund that:
3.01 It is a corporation duly organized and existing and in good standing
under the laws of the State of Nebraska:
3.02 It is empowered under applicable laws and by its Articles of
Incorporation and By-laws to enter into and perform the services contemplated in
this Agreement:
3.03 All requisite corporate proceedings have been taken to authorized it
to enter into and perform this Agreement; and
3.04 It has and will continue to have and maintain the necessary
facilities, equipment and personnel to perform its duties and obligations under
this Agreement.
Section 4. Representations and Warranties of the Fund. The Fund represents
and warrants to Administrator that:
4.01 It is a corporation duly organized and existing and in good standing
under the laws of the State of Nebraska;
4.02 It is an open-end, diversified management investment
company registered under the Investment Company Act of 1940;
4.03 A registration statement under the Securities Act of 1933 is
currently effective and will remain effective, and appropriate state securities
laws filings have been and will continue to be made, with respect to all shares
of the Fund being offered for sale;
4.04 The Fund is empowered under applicable laws and regulations and by
its charter and By-laws to enter into and perform this Agreement; and all
requisite corporate proceedings have been taken to authorize it to enter into
and perform under this Agreement.
Section 5. Indemnification.
5.01 Administrator shall not be responsible and the Fund shall
indemnify and hold Administrator harmless from and against any and all losses,
damages, costs, charges, counsel fees, payments, expenses and liability which
may be asserted against Administrator or for which it may be held to be liable,
arising out of or in any way attributable to:
(a) All actions of Administrator required to be taken by
Administrator pursuant to this Agreement provided that Administrator
has acted in good faith and with due diligence.
(b) The Fund's refusal or failure to comply with the terms of
this Agreement, or which arise out of the Fund's negligence or willful
misconduct or which arise out of the breach of any representation or
warranty of the Fund hereunder.
(c) The reliance on, or the carrying out of, any instructions
or requests of the Fund.
(d) Defaults by dealers with respect to payment for share
orders previously entered.
(e) The reliance on, or the carrying out of, any instructions
or requests of the Fund.
(f) The offer or sale of the Fund's shares in violation of
any requirement under federal securities laws or regulations or the
securities laws or regulations of any state or in violation of any stop
order or other determination or ruling by any federal agency or state
with respect to the offer or sale of such shares in such state (unless
such violation results from Administrator's failure to comply with
written instructions of the Fund or of any officer of the Fund that no
offers or sales be made in or to residents of such state).
5.02 Administrator shall indemnify and hold the Fund harmless from and
against any and all losses, damages, costs, charges, counsel fees, payments,
expenses and liability arising out of Administrator's willful failure to comply
with the terms of this Agreement or which arise out of Administrator's gross
negligence or willful misconduct.
5.03 At any time Administrator may apply to any officer of the Fund for
instructions, and may consult with legal counsel for the Fund or its own legal
counsel, at the expense of the Fund, with respect to any matter arising in
connection with the services to be performed by Administrator under this
Agreement and Administrator shall not be liable and shall be indemnified by the
Fund for
any action taken or omitted by it in good faith in reliance upon such
instructions or upon the opinion of such counsel. Administrator shall be
protected and indemnified in acting upon any paper or document believed by it to
be genuine and to have been signed by the proper person or persons and shall not
be held to have notice of any change of authority of any person, until receipt
of written notice thereof from the Fund.
5.04 In the event either party is unable to perform its obligations
under the terms of this Agreement because of acts of God, equipment or
transmission failure or damage, or other causes reasonably beyond its control,
such party shall not be liable for damages to the other for any damages
resulting from such failure to perform or otherwise from such causes.
5.05 In no event and under no circumstances shall either party to this
Agreement be liable to the other party for consequential damages under any
provision of this Agreement or for any act or failure to act hereunder.
Section 6. Covenants of Administrator and the Fund.
6.01 The Fund shall promptly furnish to Administrator, if requested
the following items:
(a) A certified copy of the resolution of the Board of Directors
of the Fund authorizing the appointment of Administrator and the
execution and delivery of this Agreement.
(b) Certified copy of the Articles of Incorporation and By-laws
of the Fund and all amendments thereto.
6.02 Administrator hereby agrees to establish and maintain facilities and
procedures reasonably acceptable to the Fund for recording share ownership,
check forms, and facsimile signature imprinting devices, if any; and for the
preparation or use, and for keeping account of such shares, forms and devices.
6.03 To the extent required by Section 31 of the Investment Company Act
of 1940 and Rules thereunder, Administrator agrees that all records maintained
by Administrator relating to the services to be performed by Administrator under
this Agreement are the property of the Fund and will be preserved and will be
surrendered promptly to the Fund on request.
6.04 Administrator and the Fund agree that all books, records,
information and data pertaining to the business of the other party which are
exchanged or received pursuant to the negotiation of and the carrying out of
this Agreement shall remain confidential, and shall not be voluntarily disclosed
to any other person.
Section 7. Termination of Agreement.
7.01 This Agreement may be terminated by either party by 90 days
written notice.
Section 8. Miscellaneous.
8.01 Neither this Agreement nor any rights or obligations hereunder
may be assigned by either party without the written consent of the other.
8.02 This Agreement shall inure to the benefit of and be binding upon
the parties and their respective successors and assigns.
8.03 This Agreement constitutes the entire agreement between the
parties hereto and supersedes any prior agreement with respect to the subject
matter hereof, whether oral or written, and this Agreement may not be modified
except by written instrument executed by both parties.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by and through their duly authorized officers, as of the day and year
first above written.
KPM FUNDS, INC.
/s/ Xxxxxx X. Xxxxx
ATTEST: By----------------------------
/s/ Xxxxx X. Xxxx
Secretary -----------------------
XXXXX XXXXX PORTFOLIO MANAGEMENT, INC.
/s/ Xxxx X. Xxxxxx
By-----------------------------
ATTEST:
/s/ Xxxxxx X. Xxxxxxx
Secretary ------------------------
APPENDIX A
FEES
The fee for services rendered by Administrator shall be calculated at the annual
rate of .25% of the average daily net asset value of Fund. Notwithstanding the
calculation of the fee, the minimum fee payable in any one year shall not be
less than $10,000. Fees shall be billed monthly by Administrator and shall be
paid monthly by Fund within fifteen (15) days of the end of each month.
