ADMINISTRATIVE AND
SHAREHOLDER SERVICES AGREEMENT
Agreement made this Twenty-second day of May, 2000, by and between the
undersigned, CITIZENS FUNDS (the "Fund"), a Massachusetts business trust, and
CITIZENS ADVISERS, INC. (the "Adviser"), a New Hampshire Corporation and
Investment Adviser to the Fund, wherein the Adviser agrees to provide certain
general administrative and shareholder services on behalf of the Fund and its
series (collectively, the "funds").
1. Description of Administrative Services. The Adviser agrees to provide the
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Fund with the following facilities and services:
(a) Administration of certain daily fund expense accounting duties,
including but not limited to payment and budgeting of operating
expenses of all funds, and calculation of expense accruals.
(b) Administration of annual Fund audit with Fund auditors.
(c) Preparation and filing of registration statement, annual and
semi-annual reports and all other required regulatory filings.
(d) Administrative services in connection with Custody and Transfer Agents,
including daily monitoring of net asset value and dividend factors,
contract and fee negotiations, and quality control.
(e) Administration of funds' compliance systems with federal and state
regulatory requirements.
(f) Organizational services for any new series of the Fund, including but
not limited to drafting the prospectus and statement of additional
information, filing of all required documents, soliciting proxies, and
clerical duties associated with the filing of any such documents.
(g) Blue Sky reporting services as required for the issuer of securities in
the states and territories.
(h) Vendor relations.
(i) Facilities and equipment to perform all such duties.
(j) Other similar services.
Determinations as to who shall provide certain of these services may be
established from time to time by written agreement between the Fund and the
Adviser to be attached as an addendum to this Agreement. The Adviser may at
times perform only a portion of these services and the Fund may choose to have
these services provided by others on the Fund's behalf.
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The foregoing list of services does not list all possible
administrative services which may be provided by the Adviser. The foregoing list
may be supplemented from time to time by written agreement between the Fund and
the Adviser to be attached as an addendum to this Agreement.
2. Description of Shareholder Services. The Adviser also agrees to provide the
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Fund with the following facilities and services:
(a) Receipt of calls from existing shareholders in a timely manner.
(b) Maintenance of a toll-free number.
(c) Response to shareholder inquiries.
(d) Maintenance of a computer interface with the Fund's transfer agent.
(e) Execution of appropriate shareholder requests.
(f) Retention, maintenance and research of shareholder records.
(g) Printing and mailing of prospectuses and annual reports to
shareholders, as well as shareholder statement production, shareholder
tax filings and other shareholder communications.
(h) Facilities and equipment to perform all such duties.
(i) Other similar services.
3. Fees and Expenses. For performance of administrative and shareholder
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services pursuant to this Agreement, the Fund agrees on behalf of each of the
individual funds to pay the Adviser and its affiliate, Citizens Securities, Inc.
(the "Distributor") on the basis of the Fee Schedule annexed as Addendum A
hereto.
In addition to any fees paid pursuant to the foregoing, the Fund agrees
on behalf of each of the individual funds to reimburse the Adviser for
out-of-pocket expenses, including but not limited to postage, forms and
materials, telephone charges and records storage. In addition, any other
expenses incurred by the Adviser at the request or with the consent of the Fund
shall be reimbursed by the Fund on behalf of the applicable fund(s).
The Fund agrees on behalf of each of the funds to pay all fees and
reimbursable expenses within five days following the mailing of the respective
billing notice.
4. Indemnification. The Adviser shall not be responsible for, and the Fund shall
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on behalf of the applicable fund(s), indemnify and hold the Adviser harmless
from and against, any and all losses, damages, costs, charges, counsel fees,
payments, expenses and liabilities arising out of or attributable to:
(a) All actions of the Adviser or its agents or subcontractors required to
be taken pursuant to this Agreement, provided that such actions are
taken in good faith and without negligence or willful misconduct.
(b) The Fund's lack of good faith, negligence or willful misconduct which
may arise out of the breach of this Agreement or any representation or
warranty of the Fund hereunder.
(c) The reliance on or use by the Adviser or its agents or subcontractors
of information, records, documents or services which (i) are received
by the Adviser or its agents or subcontractors, and (ii) have been
prepared maintained or performed by the Fund or any other person or
firm on behalf of the Fund including but not limited to any previous
transfer agent or registrar.
(d) The reliance on, or the carrying out by the Adviser or its agents or
subcontractors of, any instructions or requests of the Fund on behalf
of the applicable fund(s).
(e) The offer or sale of Shares in violation of any requirement under
federal securities laws or regulations or the securities laws or
regulations of any state that such Shares be registered in such state
or in violation of any stop order or other determination or ruling by
any federal agency or any state with respect to the offer or sale of
any such shares in such state.
At any time, the Adviser may consult with legal counsel with respect to
any matter arising in connection with the services to be performed by the
Adviser under this Agreement, and the Adviser and its agent or subcontractors
shall not be liable and shall be indemnified by the Fund on behalf of the
applicable fund(s) for any action taken or omitted by it in reliance upon such
instructions or upon the opinion of such counsel. The Adviser, its agents and
subcontractors shall be protected and indemnified in acting upon any paper or
document furnished by or on behalf of the Fund, reasonably believed to be
genuine and to have been signed by the proper person or persons, or upon any
instruction, information, data, records, or documents, provided the Adviser or
its agents or subcontractors by machine readable input, telex, CRT data entry or
other similar means authorized by the Fund, 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.
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In order that the indemnification provisions contained in this Article
shall apply, upon the assertion of a claim for which the Fund may be required to
indemnify the Adviser, the Adviser shall promptly notify the Fund of such
assertion, and shall keep the Fund advised with respect to all developments
concerning such claim. The Fund shall have the option to participate with the
Adviser in the defense of such claim or to defend against such claim in its own
name or in the name of the Adviser. The Adviser shall in no case confess any
claim or make any compromise in any case in which the Fund may be required to
indemnify the Adviser except with the Fund's prior written consent.
This Agreement may be terminated by either party upon one hundred
twenty (120) days written notice to the other. Should the Fund exercise its
right to terminate, all out of pocket expenses associated with the movement or
transfer of records and material will be borne by the Fund on behalf of the
applicable fund(s). Additionally, the Adviser reserves the right to charge for
any other reasonable expenses associated with such termination and/or a charge
equivalent to the average of three (3) months' fees.
5. Additional Funds. In the event that the Fund establishes one or more series
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of Shares in addition to Working Assets Money Market Fund, Citizens Income Fund,
Citizens Emerging Growth Fund, Citizens Global Equity Fund, Citizens Index Fund
and Citizens Small Cap Index Fund, with respect to which it desires to have the
Adviser render services under the terms of this Agreement, it shall so notify
the Adviser in writing, and if the Adviser agrees in writing to provide such
services, such series of Shares shall be subject to this Agreement.
6. Assignment of the Agreement. Unless this Agreement is amended as described
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below, neither the Agreement nor any rights or obligations hereunder may be
assigned by either party without the prior written consent of the other party.
This Agreement shall inure to the benefit and bind the parties and
their respective heirs, successors and assigns.
7. Amendment. This Agreement may be amended or modified by a writing, executed
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by both parties and authorized or approved by a resolution of the Trustees of
the Fund.
8. Applicable Law. This Agreement shall be construed and the provisions thereof
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interpreted under and in accordance with the laws of the State of New
Hampshire.
9. Acts of God. In the event either party is unable to perform its obligations
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under the terms of this Agreement because of acts of God, strikes, equipment
or transmission failure or damage 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.
10. Consequential Damages. Neither party to this Agreement shall be liable to
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the other party for consequential damages under any provision of this
Agreement or for any consequential damages arising out of any act or failure
to act hereunder.
11. Termination or Registration. The Fund will assume all duties, expenditures
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and arrangements of a continuing nature under this Agreement in the event of
its termination or the resignation of the Adviser.
A copy of the Declaration of Trust of the Fund is on file with the
Secretary of the Commonwealth of Massachusetts, and notice is hereby given that
this instrument is executed on behalf of the Trustees of the Fund as Trustees
and not individually and that the obligations of this instrument are not binding
upon any of the Trustees or Shareholders individually but are binding only upon
the assets and property of the Fund.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in their names and on their behalf by and through their duly authorized
officers, as of the day and year first above written.
CITIZENS FUNDS
By:------------------------------------
Xxxx Xxxxxx Xxxxxx
Chair
CITIZENS ADVISERS, INC.
By:------------------------------------
Xxxx X. Xxxxxxx
President and Chief Executive Officer
Attest:
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Secretary
Date: May 22, 2000
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