Exhibit 99(h)
ADMINISTRATION AGREEMENT
This Administration Agreement ("Agreement") is made and entered into as of
September 21, 2005, 2005 by and between U.S. Bancorp Asset Management, Inc., a
Delaware corporation ("USBAM") and the USBAM Securities Lending Trust, a
Delaware Statutory Trust (the "Trust"), on behalf of the USBAM Securities
Lending Prime Portfolio and the USBAM Securities Lending Short-Term Bond
Portfolio (individually a "Portfolio" and collectively the "Portfolios").
1. ENGAGEMENT OF USBAM; SERVICES.
a. ADMINISTRATIVE AND TRANSFER AGENT SERVICES. The Trust hereby engages
USBAM on behalf of the Portfolios, and USBAM hereby agrees to perform,
or supervise the performance by others of, administrative, transfer
agent and other services as set forth herein in connection with the
operations of the Portfolios. USBAM is authorized to appoint and
compensate from its resources one or more other entities to perform
such services on a subcontracted basis in connection with the
operations of the Portfolios. If USBAM appoints one or more other
entities to perform services called for by this Agreement on a
subcontracted basis as aforesaid, USBAM nevertheless shall remain
liable to the Trust and the Portfolios for the acts and omissions of
such other entities as if USBAM itself performed such services. USBAM
shall promptly notify the Trust of any persons appointed on a
subcontracted basis pursuant to this provision.
In addition, on behalf of the Trust, USBAM will monitor and review
the Trust's relationships with vendors including relationships with
custodians, depositories, transfer agents, accountants, the Trust's legal
counsel, brokers and dealers, corporate fiduciaries, insurers, banks and
persons in any other capacity deemed to be necessary or desirable for the
Portfolios' operations and, at the request of the Trust's Board of
Trustees, will investigate and assist in the selection of such service
providers.
(i) Administrative Services. USBAM shall provide the Trust with
regulatory reporting, Trust accounting and related portfolio
accounting services, all necessary office space, equipment,
personnel, compensation and facilities (including facilities for
shareholders' and Trustees' meetings) for handling the affairs of
the Portfolios, and such other services as USBAM shall, from time
to time, determine to be necessary to perform its obligations
under this Agreement. In addition, at the request of the Trust's
Board of Trustees, USBAM shall make such reports to the Trust's
Trustees concerning the performance of its obligations hereunder
as reasonably agreed to from time to time. Without limiting the
generality of the foregoing, USBAM, under the supervision of the
Trust's Board of Trustees, shall:
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o calculate Trust expenses and control all disbursements for
the Trust, and as appropriate, compute the Trust's yields,
total return, expense ratios, portfolio turnover rate and,
portfolio average dollar-weighted maturity;
o assist with preparation of offering memorandums,
registration statements and proxy materials;
o prepare communications to shareholders, including the annual
and semi-annual reports to shareholders, coordinate mailing
offering memorandums, notices, proxy statements, proxies and
other reports to the Trust's shareholders, and supervise and
facilitate the solicitation of proxies solicited by the
Trust for all shareholder meetings, including the tabulation
process for shareholder meetings;
o maintain the Trust's general ledger and prepare the Trust's
financial statements, including expense accruals and
payments, determine the net asset value of the Trust's
assets and of the Trust's shares, and provide for the
payment of dividends and other distributions to
shareholders;
o coordinate and supervise the preparation and filing of the
Trust's tax returns;
o examine and review the operations and performance of the
various directly or on a subcontracted basis as provided for
herein and, at the request of the Trust's Board of Trustees,
report to the Board on the performance of such
organizations;
o provide for and coordinate the layout and printing of
offering memorandums and the Trust's semi-annual and annual
reports to shareholders;
o provide internal legal and administrative services as
requested by the Trust from time to time;
o provide for and coordinate the design, development, and
operation of the Trust, including new portfolio investment
objectives, policies and structure;
o provide individuals reasonably acceptable to the Trust's
Board of Trustees for nomination, appointment, or election
as officers of the Trust, who will be responsible for the
management of certain of the Trust's affairs as determined
by the Trust's Board of Trustees;
o advise the Trust and the Trust's Board of Trustees on
matters concerning the Trust and its affairs;
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o obtain and keep in effect fidelity bonds and trustees and
officers/errors and omissions insurance policies for the
Trust in accordance with the requirements of Rules 17g-1 and
17d-1(7) under the Investment Company Act of 1940 (the "1940
Act") as such bonds and policies are approved by the Trust's
Board of Trustees;
o monitor and advise the Trust and the Portfolios on their
registered investment company status under the Internal
Revenue Code of 1986, as amended;
o furnish advice and recommendations with respect to other
aspects of the business and affairs of the Portfolios as the
Trust and USBAM shall determine desirable;
o prepare and file with the Securities and Exchange Commission
the semi-annual reports for the Trust on Form N-SAR and Form
N-CSR, quarterly reports on Form N-Q, and annual proxy
voting reports on Form N-PX;
o organize and coordinate meetings of the Trust's Board of
Trustees and the committees thereof; and
o perform all other administrative services and functions
required for the operation of the Trust and each Portfolio.
(ii) Transfer Agent Services. USBAM shall perform all of the
customary services of a transfer agent and dividend disbursing
agent for the Trust, including but not limited to:
o receive and process all orders for the purchase, exchange,
and/or redemption of shares in accordance with Rule 22c-1 of
the 1940 Act;
o process purchase orders with prompt delivery, where
appropriate, of payment and supporting documentation to the
Trust's custodian, and issue the appropriate number of
uncertificated shares with such uncertificated shares being
held in the appropriate shareholder account;
o process redemption requests received in good order and,
where relevant, deliver appropriate documentation to the
Trust's custodian;
o pay monies upon receipt from the Trust's custodian, where
relevant, in accordance with the instructions of redeeming
shareholders;
o process transfers of shares in accordance with the
shareholder's instructions;
o prepare and transmit payments for dividends and
distributions declared by the Trust, after deducting any
amount required to be withheld by any
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applicable laws, rules and regulations and in accordance
with shareholder instructions;
o make changes to shareholder records;
o record the issuance of shares of the Trust and maintain,
pursuant to Rule 17Ad-10(e) promulgated under the Securities
Exchange Act of 1934, as amended, a record of the total
number of shares of the Trust that are authorized, issued
and outstanding;
o prepare shareholder-meeting lists and, if applicable, mail,
receive and tabulate proxies;
o mail shareholder reports and offering memorandums to current
and prospective shareholders;
o prepare and file U.S. Treasury Department Forms 1099 and
other appropriate information returns required with respect
to dividends and distributions for shareholders;
o provide shareholder account information upon request and
prepare and mail confirmations and statements of account to
shareholders for purchases, redemptions and other
confirmable transactions as agreed upon with the Trust;
o mail requests for shareholders' certifications under
penalties of perjury and pay on a timely basis to the
appropriate federal authorities any taxes to be withheld on
dividends and distributions paid by the Trust, all as
required by applicable federal tax laws and regulations;
o reimburse the Trust each month for all material losses
resulting from "as of" processing errors for which USBAM is
responsible in accordance with the "as of" processing
guidelines agreed to by USBAM; and
b. SHAREHOLDER SERVICES. The Trust on behalf of the Portfolios hereby
engages USBAM, and USBAM hereby agrees, to provide the Portfolios with
all services to shareholders not otherwise the subject of Section 1(a)
above. These shareholder services may include personal services
provided to shareholders, such as answering shareholder inquiries
regarding a Portfolio and providing reports and other information and
services related to the maintenance of shareholder accounts.
c. OTHER SERVICES. USBAM shall, at its own expense, provide or arrange
for the provision of all services required by the Trust on behalf of
the Portfolios not otherwise addressed in this Agreement or the
Investment Advisory Agreement between USBAM and the Trust.
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d. FILINGS, OFFICE FACILITIES, EQUIPMENT AND PERSONNEL. USBAM shall
furnish the Trust and the Portfolios with all office facilities,
equipment and personnel necessary to discharge its responsibilities
and duties hereunder.
e. BOOKS AND RECORDS. USBAM hereby acknowledges that all records
pertaining to the services rendered hereunder are the sole and
exclusive property of the Trust, and in the event that a transfer of
any of the services currently rendered hereunder to someone other than
USBAM should ever occur, USBAM will promptly, and at its own cost,
take all steps necessary to segregate such records and deliver them to
the Trust.
f. LIMITATION OF LIABILITY. USBAM, in carrying out and performing the
terms and conditions of this Agreement, shall incur no liability for
its status hereunder or for any actions taken or omitted in good faith
and without negligence. Without limitation of the foregoing:
(i) The duties of USBAM shall be confined to those expressly set
forth herein or subsequently expressly agreed upon, and no implied
duties are assumed by or may be asserted against USBAM hereunder.
USBAM shall not be liable for any error of judgment or mistake of
law or for any loss arising out of any investment or for any act
or omission in carrying out its duties hereunder, except a loss
resulting from willful misfeasance, bad faith or negligence in the
performance of its duties, or by reason of reckless disregard of
its obligations and duties hereunder, except as may otherwise be
provided under provisions of applicable law which cannot be waived
or modified hereby.
(ii)So long as USBAM acts in good faith and with due diligence and
without negligence, the Trust assumes full responsibility and
shall indemnify USBAM and hold it harmless from and against any
and all actions, suits and claims, whether groundless or
otherwise, and from and against any and all losses, damages,
costs, charges, reasonable counsel fees and disbursements,
payments, expenses and liabilities (including reasonable
investigation expenses) arising directly or indirectly out of said
Investment Advisory, Administration and Transfer Agency
relationships to the Trust or any other service rendered to the
Trust hereunder. The indemnity and defense provisions set forth
herein shall indefinitely survive the termination of this
Agreement.
(iii) USBAM shall indemnify and hold harmless the Trust and each
Portfolio from and against any and all losses, damages, costs,
charges, reasonable counsel fees and disbursements, payments,
expenses and liabilities arising out of or attributable to any
action or failure or omission to act by the USBAM as a result of
USBAM's willful misfeasance, bad faith or negligence.
(iv) In order that the indemnification provision contained herein
shall apply, however, it is understood that if in any case the
Trust may be asked to
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indemnify or hold USBAM harmless, the Trust shall be fully and
promptly advised of all pertinent facts concerning the situation
in question, and it is further understood that USBAM will use all
reasonable care to identify and notify the Trust promptly
concerning any situation which presents or appears likely to
present the probability of such a claim for indemnification
against the Trust, but failure to do so in good faith shall not
affect USBAM's rights hereunder.
(v) The Trust shall be entitled to participate at its own expense
or, if it so elects, to assume the defense of any suit brought to
enforce any claims subject to this indemnity provision. If the
Trust elects to assume the defense of any such claim, the defense
shall be conducted by counsel chosen by the Trust and reasonably
satisfactory to USBAM, whose approval shall not be unreasonably
withheld. In the event that the Trust elects to assume the defense
of any suit and retain counsel, USBAM shall bear the fees and
expenses of any additional counsel retained by it. If the Trust
does not elect to assume the defense of a suit, it will reimburse,
subject and pursuant to the provisions of this Section 1(f), USBAM
for the reasonable fees and expenses of any counsel retained by
USBAM.
(vi) USBAM may apply to the Trust at any time for instructions and
may consult outside counsel for the Trust or its own counsel and
with accountants and other experts with respect to any matter
arising in connection with the USBAM's duties, and USBAM shall not
be liable or accountable for any action taken or omitted by it in
good faith in accordance with such instruction or with the opinion
of such counsel, accountants or other experts.
(vii) USBAM shall be protected in acting upon any document which
it reasonably believes to be genuine and to have been signed or
presented by the proper person or persons, other than documents
signed or presented by officers, trustees, employees and other
corporate agents of USBAM.
2. COMPENSATION FOR SERVICES, PAYMENT OF EXPENSES.
(a) In payment for the services to be provided or arranged by USBAM
hereunder, the Trust shall pay to USBAM a fee, on behalf of each
Portfolio, equal on an annual basis to 0.02% of such Portfolio's
average daily net assets (as determined in accordance with the
Portfolios' current Registration Statement, as the same may from time
to time be amended or supplemented). This fee shall be paid to USBAM
on a monthly basis not later than the tenth business day of the month
following the month in which the services were rendered and shall be
prorated for any fraction of a month at the commencement or
termination of this Agreement. USBAM may waive all or a portion of
such fee from time to time, in its discretion.
(b) USBAM shall bear all of the Portfolios' expenses, except for
brokerage commissions and other expenditures in connection with the
purchase and sale of portfolio securities, interest expense and,
subject to the specific approval of a
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majority of the Trustees of the Trust who are not "interested persons"
(as defined in the 0000 Xxx) of USBAM or the Trust, taxes and
extraordinary expenses.
3. FREEDOM TO DEAL WITH THIRD PARTIES.
USBAM shall be free to render services to others similar to those rendered
under this Agreement or of a different nature except as such services may
conflict with the services to be rendered or the duties to be assumed hereunder.
4. EFFECTIVE DATE, DURATION, AMENDMENT AND TERMINATION OF AGREEMENT.
(a) Unless sooner terminated as hereinafter provided, this Agreement
shall continue in effect with respect to each Portfolio for a period
of two years from the date of its execution, and thereafter shall
continue in effect only so long as such continuance is specifically
approved at least annually by (i) the Board of Trustees of the Trust
or by the vote of a majority of the outstanding voting securities of
the applicable Portfolio, and (ii) by the vote of a majority of the
Trustees of the Trust who are not parties to this Agreement or
"interested persons" (as defined in the 0000 Xxx) of USBAM or of the
Trust at a meeting called for the purpose of voting on such approval.
(b) This Agreement may be terminated at any time with respect to
either Portfolio, without the payment of any penalty, by the Board of
Trustees of the Trust or by the vote of a majority of the outstanding
voting securities of such Portfolio, or by USBAM, upon 60 days'
written notice to the other party.
(c) This Agreement shall automatically terminate in the event of its
"assignment" (as defined in the Investment Trust Act of 1940, as
amended).
(d) No amendment to this Agreement shall be effective with respect to
a Portfolio until approved by the vote of a majority of the Trustees
of the Trust who are not parties to this Agreement or "interested
persons" (as defined in the 0000 Xxx) of USBAM or of the Trust cast at
a meeting called for the purpose of voting on such approval.
(e) Wherever referred to in this Agreement, the vote or approval of
the holders of a majority of the outstanding voting securities of a
Portfolio shall mean the lesser of (i) the vote of 67% or more of the
voting securities of the Portfolio present at a regular or special
meeting of shareholders duly called, if more than 50% of the
Portfolio's outstanding voting securities are present or represented
by proxy, or (ii) the vote of more than 50% of the outstanding voting
securities of the Portfolio.
(f) To the extent the provisions of this Section 4 are based on
legislative or regulatory requirements in effect at the time of this
Agreement's initial approval by the Board of Trustees and/or
shareholders and any such legislative or regulatory requirements
change, the relevant provision of this Section 4 will be deemed to
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have been so amended without further action by the Board of Trustees or the
Portfolio's shareholders.
5. NOTICES.
Any notice under this Agreement shall be in writing, addressed, delivered
or mailed, postage prepaid, to the other party at such address as such other
party may designate in writing for receipt of such notice.
6. REPRESENTATION.
USBAM hereby represents that it will maintain registrations with and/or
approvals by all relevant governmental authorities necessary for the provision
of services pursuant to this Agreement.
7. INTERPRETATION: GOVERNING LAW.
This Agreement shall be subject to and interpreted in accordance with all
applicable provisions of law including, but not limited to, the 1940 Act. To the
extent that the provisions herein contained conflict with any such applicable
provisions of law, the latter shall control. The laws of the State of Delaware
shall otherwise govern the construction, validity and effect of this Agreement.
8. OBLIGATIONS BINDING ON TRUST.
This Agreement is made by the Trust pursuant to authority granted by the
Trustees, and the obligations created hereby are not binding on any of the
Trustees or shareholders of the Trust individually, but bind only the property
of the Trust.
IN WITNESS WHEREOF, the Trust and USBAM have caused this Agreement to be
executed by their duly authorized officers as of the day and year first above
written.
USBAM SECURITIES LENDING TRUST
By /s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx
Vice President--Administration
U.S. BANCORP ASSET MANAGEMENT, INC.
By /s/ Xxxxxx X. Xxxxx III
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Xxxxxx X. Xxxxx III
Chief Financial Officer
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