EXHIBIT 23H(5) ADMINISTRATIVE SERVICES AGREEMENT
FORM OF
ADMINISTRATIVE SERVICES AGREEMENT
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Administrative Services Agreement (the "Agreement") dated September 28,
2001, by and between Dominion Funds, Inc.(the "Fund"), a diversified, open-end
management investment company, duly organized as a corporation in accordance
with the laws of the State of Maryland, and COMMONWEALTH SHAREHOLDER SERVICES,
INC. ("CSS"), a corporation duly organized as a corporation in accordance with
the laws of the Commonwealth of Virginia.
WITNESSETH THAT:
WHEREAS, the Fund desires to appoint CSS as its Administrative Services
Agent, for and on behalf of the Fund and any additional series of the Fund as
may from time to time be created and designated by the Fund and which becomes
subject to this Agreement by the mutual consent of the parties hereto, to
perform certain record keeping and shareholder servicing functions required of a
duly registered investment company to comply with certain provisions of federal,
state and local law, rules and regulations, and, as is required, to assist the
Fund in preparing and filing certain financial reports, and further to perform
certain daily functions in connection with on-going operations of the Fund and
the Series, and provide ministerial services to implement the investment
decisions of the Fund and the investment advisers of the Series.
WHEREAS, CSS is willing to perform such functions upon the terms and
conditions herein set forth;
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants herein contained, the parties hereto, intending to be legally bound,
agree as follows:
SECTION 1. CSS hereby undertakes to assist the Fund with certain
administrative services that will be required in the conduct of the Fund's
business. The services to be provided by CSS are reflected in Schedule B to this
Agreement.
SECTION 2. CSS shall examine and review all records and documents of the
Series pertaining to its duties under this Agreement in order to determine
and/or recommend how such records and documents shall be maintained.
SECTION 3.
(a) CSS shall, as necessary for such purposes, advise the Fund and its
agents
of the information, which is deemed to be "necessary" for the performance of its
duties under this Agreement.
(b) Information deemed necessary may include, but is not limited to: (i)
resolutions of the Board authorizing the appointment of CSS to provide the above
stated services to the Fund and approving this Agreement; (ii) the Fund's
Articles of Incorporation, Articles of Amendment and Articles Supplementary;
(iii) the Fund's By-Laws; (iv) the Fund's registration statement including
exhibits, as amended, on Form N-1A under the Securities Act of 1933 (the "1933
Act"), as filed with the SEC; (v) copies of each of the Investment Advisory
Agreements between the Fund and the Adviser; (vi) opinions of counsel and
auditors reports; (vii) the Fund's prospectus(es) and statement(s) of additional
information relating to the Series, portfolios and classes, as applicable, and
all amendments and supplements thereto; (viii) the state blue sky files
pertaining to each series; and (ix) such other material agreements as the Fund
may enter into from time to time including securities lending agreements,
futures and commodities account agreements, brokerage agreements and options
agreements.
(c) Upon receipt of necessary information and Written or Oral Instructions
from the Fund, CSS shall create, maintain and keep current such administrative
records in accordance with all applicable laws, rules and regulations, including
but not limited to records required by Section 31(a) of the 1940 Act and the
rules thereunder, as amended from time to time.
Unless the information necessary to perform the above functions is
furnished in writing to CSS by the Fund or its agents (such as Custodians,
Transfer Agents, etc.), CSS shall incur no liability and the Fund shall
indemnify and hold harmless CSS from and against any liability arising from any
discrepancy in the information received by CSS and used in the performance by
CSS of its duties.
It shall be the responsibility of the Fund to furnish CSS with the net
asset value per share, declaration, record and payment dates and amounts of any
dividends or income and any other special actions required concerning each of
its securities.
SECTION 4. CSS shall provide such additional administrative non-advisory
management services as CSS and the Fund may from time to time agree in writing.
SECTION 5. CSS shall provide assistance to the Fund in the servicing of
shareholder accounts, which may include telephone and written conversations,
assistance in redemptions, exchanges, transfers and opening accounts as may be
required from time to time. CSS shall, in addition, provide such additional
administrative non-advisory management services as CSS and the Fund may from
time to time agree.
SECTION 6. The accounts and records maintained by CSS shall be the property
of the Fund, and shall be made available to the Fund, within a reasonable period
of time, upon demand. CSS shall assist the Fund's independent auditors, or any
other person authorized by the Fund or, upon demand, any regulatory body as
authorized by law or
regulation, in any requested review of the Fund's accounts and records but shall
be reimbursed for all reasonable and documented expenses and employee time
invested in any such review outside of routine and normal periodic reviews. Upon
receipt from the Fund of any necessary information, CSS shall assist the Fund in
organizing necessary data for the Fund's completion of any necessary tax
returns, questionnaires, periodic reports to shareholders and such other reports
and information requests as the Fund and CSS shall agree upon from time to time.
SECTION 7. CSS and the Fund may from time to time adopt procedures relating
to matters covered by this Agreement, and, absent knowledge to the contrary, CSS
may conclusively assume that any procedure approved by the Fund or directed by
the Fund, does not conflict with or violate any requirements of Fund's
Prospectuses, Articles of Incorporation, By-Laws, registration statements,
orders, or any rule or regulation of any regulatory body or governmental agency.
The Fund (acting through its officers or other agents) shall be responsible for
notifying CSS of any changes in regulations or rules, which might necessitate
changes in the Fund's procedures.
SECTION 8. CSS may rely upon the advice of the Fund and upon statements of
the Fund's lawyers, accountants and other persons believed by it in good faith
to be expert in matters upon which they are consulted, and CSS shall not be
liable for any actions taken in good faith upon such statements.
SECTION 9. CSS shall not be liable for any actions taken in good faith
reliance upon any authorized Oral Instructions, any Written Instructions, and
certified copy of any resolution of the Board of Directors of the Fund or any
other document reasonably believed by CSS to be genuine and to have been
executed or signed by the proper person or persons.
CSS shall not be held to have notice of any change of authority of any
officer, employee or agent of the Fund until receipt of notification thereof by
the Fund.
The Fund shall indemnify and hold CSS harmless from any and all expenses,
damages, claims, suits, liabilities, actions, demands and losses whatsoever
arising out of or in connection with any error, omission, inaccuracy or other
deficiency of any information provided to CSS by the Fund, or the failure of the
Fund to provide any information needed by CSS knowledgeably to perform its
functions hereunder. Also, the Fund shall indemnify and hold harmless CSS from
all claims and liabilities (including reasonable documented expenses for legal
counsel) incurred by or assessed against CSS in connection with the performance
of this Agreement, except such as may arise from CSS's own negligent action,
omission or willful misconduct; provided, however, that before confessing any
claim against it, CSS shall give the Fund reasonable opportunity to defend
against such claim in the name of the Fund or CSS or both.
SECTION 10. The Fund agrees to pay CSS compensation for its services and to
reimburse it for expenses, as set forth in the Schedule attached hereto, or as
shall be set
forth in amendments to such schedule approved by the Fund's Board of Directors
and CSS.
SECTION 11. Except as required by laws and regulations governing investment
companies, nothing contained in this Agreement is intended to or shall require
CSS, in any capacity hereunder, to perform any functions or duties on any
holiday or other day of special observance on which CSS is closed. Functions or
duties normally scheduled to be performed on such days shall be performed on,
and as of, the next business day on which both the Fund and CSS are open. CSS
will be open for business on days when the Fund is open for business and/or as
otherwise set forth in the Fund's Prospectus(es) and Statement(s) of Additional
Information.
SECTION 12. Either the Fund or CSS may give written notice to the other of
the termination of this Agreement, such termination to take effect at the time
specified in the notice, which time shall be not less than 60 days from the
giving of such notice. Such termination shall be without penalty.
SECTION 13. Any notice or other communication required by or permitted to
be given in connection with this Agreement shall be in writing, and shall be
delivered in person or sent by first-class mail, postage prepaid, to the
respective parties at their last known address, except that Oral Instructions
may be given if authorized by the Board of the Fund and preceded by a
certificate from the Fund's secretary so attesting.
Notices to the Fund shall be directed to:
Xxxx Xxxxxxxx
Foundation Management, Inc.
0000 Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
000-000 0000 main
000-000 0000 fax
xxxxxxxx@xxxxxxxxx.xxx
Notices to CSS shall be directed to:
0000 Xxxxxx Xxxxxx
Xxxxx 000
Xxxxxxxx, Xxxxxxxx 00000
SECTION 14. This Agreement may be executed in two or more counterparts,
each of which, when so executed, shall be deemed to be an original, but such
counterparts shall together constitute but one and the same instrument.
SECTION 15. 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 by the Fund without the written consent of
CSS, or by CSS without the written consent of the Fund, authorized or approved
by a resolution of its Board of Directors.
SECTION 16. For purposes of this Agreement, the terms Oral Instructions and
Written Instructions shall mean:
Oral Instructions: The term Oral Instruction shall mean an authorization,
instruction, approval, item or set of data, or information of any kind
transmitted to CSS in person or by telephone, telegram, telecopy, or other
mechanical or documentary means lacking a signature, by a person or persons
believed in good faith by CSS to be a person or persons authorized by a
resolution of the Board of Directors of the Fund, to give Oral Instructions on
behalf of the Fund.
Written Instructions: The term Written Instruction shall mean an
authorization, instruction, approval, item or set of data, or information of any
kind transmitted to CSS in original writing containing original signatures or a
copy of such document transmitted by telecopy including transmission of such
signature believed in good faith by CSS to be the signature of a person
authorized by a resolution of the Board of Directors of the Fund to give Written
Instructions on behalf of the Fund.
The Fund shall file with CSS a certified copy of each resolution of its
Board of Directors authorizing execution of Written Instructions or the
transmittal of Oral Instructions as provided above.
SECTION 17. This Agreement shall be governed by the laws of the State of
Maryland.
SECTION 18. This Agreement may be modified or amended from time to time by
mutual written agreement between the parties. No provision of this Agreement may
be changed, discharged, or terminated orally, but only by an instrument in
writing signed by the party against which enforcement of the charge, discharge
or termination is sought.
SECTION 19. If any provision of this Agreement is invalid or unenforceable,
the balance of the Agreement shall remain in effect, and if any provision is
inapplicable to any person or circumstance it shall nevertheless remain
applicable to all other persons and circumstances.
SECTION 20. CSS agrees that, except as otherwise required by law or in
connection with any required disclosure to a regulatory authority or for
purposes of performing its obligations under this Agreement, and after notice to
and agreement of the Fund, CSS will keep confidential all records and
information in its possession relating to the Fund or its shareholders and will
not disclose any confidential information except at the request or with the
written consent of the Fund.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
signed by their duly authorized officers as of the day and year first above
written.
Dominion Fund, Inc
By:__________________
Name: Xxxx Xxxxxxxx
Title: Director
COMMONWEALTH SHAREHOLDER SERVICES, INC.
By:__________________
Name: Xxxx Xxxxx, III
Title: President
SCHEDULE A TO
ADMINISTRATIVE SERVICES AGREEMENT
BY AND BETWEEN
DOMINION FUND, INC. AND
COMMONWEALTH SHAREHOLDER SERVICES, INC.
Pursuant to Section 9 of the Administrative Services Agreement, dated
September 28, 2001, by and between Dominion Fund, Inc. (the "Fund"), and
Commonwealth Shareholder Services, Inc. ("CSS"), on behalf of the Fund and any
additional series of the Fund as may from time to time be created and designated
by the Fund and which becomes subject to this Agreement by the mutual consent of
the parties, each series shall pay CSS a fee calculated and paid monthly as
follows:
A. For all other administration, CSS shall be paid a fee at the rate of 0.20%
per annum of the average daily net assets on the first $50 million (with a
minimum fee of $12,000 per annum the first two years and $30,000 per year
thereafter, 0.15% per annum of the average daily net assets from $50
million to $100 million, and 0.1% on the average daily net assets over $100
million.
B. For the creation of a Separate Share Class to the Fund, CSS shall be paid a
fee at the rate of 0.02% per annum of the average daily net assets (with a
minimum fee of $3,000 per annum). CSS agrees to accrue the difference
between the 0.02% fee paid and the $3,000 per annum minimum payment, until
the Separate Share Class 0.02% fee exceeds $3,000 per annum. Once the
Separate Share Class' 0.02% fee exceeds the $3,000 per annum minimum
payment, the accrued difference between the 0.02% fee paid and the $3,000
per annum minimum payment, will be billed to the Fund and payable in 12
monthly payments.
C. In addition to the foregoing, the Fund shall reimburse CSS, from the assets
of the Series, for the Series' proportionate share of general expenses
incurred for the Fund and for all expenses incurred by the Series
individually. Such out-of-pocket expenses shall include, but not be limited
to: documented fees and costs of obtaining advice of counsel or accountants
in connection with its services to the Fund; postage; long distance
telephone; special forms required by the Fund; any travel which may be
required in the performance of its duties to the Fund; and any other
extraordinary expenses it may incur in connection with its services to the
Fund.
PROPOSED SCHEDULE B
TO ADMINISTRATIVE SERVICES AGREEEMENT
BY AND BETWEEN
DOMINION FUND, INC. AND COMMONWELATH SHAREHOLDER SERVICES
Pursuant to Section 1 of the Administrative Services Agreement, dated, September
28, 2001, by and between Dominion Fund, Inc. (the "Fund") and Commonwealth
Shareholder Services, Inc. ("CSS"), the following outlines CSS's proposed duties
and responsibilities to be covered under the Agreement:
1. Subject to the direction and control of the Board, CSS shall manage
all aspects of the Fund's operations with respect to the Fund except
those that are the responsibility of any other service provider hired
by the Fund, all in such manner and to such extent as may be
authorized by the Board.
2. Oversee the performance of administrative and professional services
rendered to the Fund by others, including its custodian, transfer
agent and dividend disbursing agent as well as legal, auditing,
shareholder servicing and other services performed for the Fund,
including:
(a) The preparation and maintenance by the Fund's custodian, transfer
agent, dividend disbursing agent and fund accountant in such
form, for such periods and in such locations as my be required by
applicable United States law, of all documents and records
relating to the operation of the Fund required to be prepared or
maintained by the Fund or its agents pursuant to applicable law.
(b) The reconciliation of account information and balances among the
Fund's custodian, transfer agent, dividend disbursing agent and
fund accountant.
(c) The transmission of purchase and redemption orders for shares.
(d) The performance of fund accounting, including the calculation of
the Net Asset Value of the shares.
3. Assist each Fund's investment adviser in monitoring fund holdings for
compliance with prospectus investment restriction and assist in
preparation of periodic compliance reports, as applicable.
4. Prepare and coordinate the printing of semi-annual and annual
financial statements.
5. Print standard annual reports, semi- annual and annual financial
statements for shareholders. All other printing of annual reports for
marketing and distribution will be billed at cost as an out-of-pocket
expense.
6. Prepare selected management reports for performance and compliance
analyses agreed upon by the Fund and Administrator from time to time.
7. Advise the Fund and the Board on matters concerning the Fund and its
affairs.
8. With the assistance of the counsel to the Fund, the investment
advisers, officers of the Fund and other relevant parties, prepare and
disseminate materials for meetings of the Board, including agendas and
selected financial information as agreed upon by the Fund and CSS from
time to time; attend and participate in Board meetings to the extent
requested by the Board; and prepare minutes of the meetings of the
Board for review by Fund legal counsel.
9. Provide assistance to the Fund's independent public accountants in
order to determine income and capital gains available for distribution
and calculate distributions required to meet regulatory, income and
excise tax requirements.
10. Assist the Fund's independent public accountants with the preparation
of the Fund's federal, state and local tax returns to be review by the
Fund's independent public accounts.
11. Prepare and maintain the Fund's operating expense budget to determine
proper expense accruals to be charged to each Fund in order to
calculate it's daily Net Asset Value.
12. In consultation with counsel for the Fund, assist in and oversee the
preparation, filing, printing and where applicable, dissemination to
shareholders of the following:
(a) Amendments to the Fund's Registration Statement on Form N-1A.
(b) Periodic reports to the Funds' shareholders and the commission,
including but not limited to annual reports and semi-annual
reports.
(c) Notices pursuant to Rule 24f-2.
(d) Proxy materials.
(e) Reports to the SEC on Form N-SAR.
13. Coordinate the Fund's annual or SEC audit by:
(a) Assisting the Fund's independent auditors, or, upon approval of
the Fund, any regulatory body in any requested review of the
Fund's accounts and records.
(b) Providing appropriate financial schedules (as requested by the
Fund's independent public accounts or SEC examiners); and,
(c) Providing office facilities as may be required.
14. After consultation with counsel for the Fund and the investment
adviser, assist the investment adviser to determine the jurisdictions
in which shares of the Fund shall be registered or qualified for sale;
register, or prepare applicable filings with respect to, the shares
with the various state and other securities commissions, provided that
all fees for the registration of shares or for qualifying or
continuing the qualification of the Fund shall be paid by the Fund.
15. Monitor sales of shares, ensure that the shares are properly and duly
registered with the SEC.
16. Oversee the calculation of performance data for dissemination to
information services covering the investment company industry, for
sales literature of the Fund and other appropriate purposes.
17. Prepare, or cause to be prepared, expense and financial reports,
including Fund budgets, expense reports, pro-forma financial
statements, expense and profit/loss projections and fee waiver/expense
reimbursement projections on a periodic basis.
18. Authorize the payment of Fund expenses and pay, from Fund assets, all
bills of the Fund.
19. Provide information typically supplied in the investment company
industry to companies that track or report price, performance or other
information with respect to investment companies.
20. Assist the Fund in the selection of other service providers, such as
independent accountants, law firms and proxy solicitors; and perform
such other recordkeeping, reporting and other tasks as may be
specified from
time to time in the procedures adopted by the Board; provided that CSS
need not begin performing any such task except upon 65 days' notice
and pursuant to mutually acceptable compensation agreements.
21. CSS shall provide such other services and assistance relating to the
affairs of the Fund as the Fund may, from time to time, reasonably
request pursuant to mutually acceptable compensation agreements.
22. Except with respect to CSS's duties as set forth in this Section, and
except as otherwise specifically provided herein, the Fund assumes all
responsibility for ensuring that the Fund complies with all applicable
requirement of the Securities Act, the 1940 Act and any laws, rules
and regulations of governmental authorities with jurisdiction over the
Fund. All references to any law in this Agreement shall be deemed to
include reference to the applicable rules and regulations promulgated
under authority of the law and all official interpretations of such
law or rules or regulations.
23. In order for CSS to perform the services required by this Section, the
Fund (i) shall cause all service providers to the Fund to furnish any
and all information to CSS and assist CSS as may be required and (ii)
shall ensure that CSS has access to all records and documents
maintained by the Fund or any service provider to the Fund.
