MENTOR FUNDS
000 Xxxx Xxxx Xxxxxx
Xxxxxxxx, Xxxxxxxx 00000
February 1, 1998, as amended
February 10, 1999
Mentor Investment Group, LLC
000 Xxxx Xxxx Xxxxxx
Xxxxxxxx, Xxxxxxxx 00000
Re: Administration Agreement
Dear Gentlemen:
Mentor Funds, a Massachusetts business trust (the "Fund"), is engaged in
the business of an investment company. The Fund currently has twelve series of
shares (each, a "Series"), and the Trustees of the Fund may in their discretion
authorize additional series of shares from time to time. The Fund desires that
you act as administrator of one or more Series specified by the Trustees from
time to time on Exhibit A hereto (each, a "Specified Series") of the Fund, and
you are willing to act as such administrator and to perform such services under
the terms and conditions hereinafter set forth. Accordingly, the Fund agrees
with you as follows:
1. Delivery of Fund Documents. The Fund has furnished you with copies
properly certified or authenticated of each of the following:
(a) Agreement and Declaration of Trust of the Fund.
(b) By-laws of the Fund as in effect on the date hereof.
(c) Resolutions of the Trustees of the Fund selecting you as
administrator and approving the form of this Agreement.
The Fund will furnish you from time to time with copies, properly
certified or authenticated, of all amendments of or supplements to the
foregoing, if any.
2. Administrative Services. You will continuously provide business
management services to each of the Specified Series and will generally, subject
to the general oversight of the Trustees and except as provided in the next
following paragraph, manage all of the business and affairs of each of the
Specified Series, subject always to the provisions of the Fund's Declaration of
Trust and By-laws and of the Investment Company Act of 1940, as amended (the
"1940 Act"), and subject, further, to such policies and instructions as the
Trustees may from time to time establish. You shall, except as provided in the
next following paragraph, advise and assist the officers of the Fund in taking
such steps as are necessary or appropriate to carry out the decisions of the
Trustees and the appropriate committees of the Trustees regarding the conduct of
the business of each of the Specified Series.
Notwithstanding any provision of this Agreement, you will not at any time
provide, or be required to provide, to the Fund or to any person with respect to
the Fund investment research, advice, or supervision, or in any way advise the
Fund or any person acting on behalf of the Fund as to the value of securities or
other investments or as to the advisability of investing in, purchasing, or
selling securities or other investments.
3. Allocation of Charges and Expenses. You will pay the compensation and
expenses of all officers and executive employees of the Fund (other than such
persons who serve as such and who are employees of or serve at the request of
any investment adviser to the Fund) and will make available, without expense to
the Fund, the services of such of your directors, officers, and employees as may
duly be elected Trustees or officers of the Fund, subject to their individual
consent to serve and to any limitations imposed by law. You will provide all
clerical services relating to the business of each of the Specified Series. You
will not be required to pay any expenses of the Fund other than those
specifically allocated to you in this paragraph 3. In particular, but without
limiting the generality of the foregoing, you will not be required to pay:
clerical salaries not relating to the services described in paragraph 2 above;
fees and expenses incurred by the Fund in connection with membership in
investment company organizations; brokers' commissions; payment for portfolio
pricing services to a pricing agent, if any; legal, auditing, or accounting
expenses; taxes or governmental fees; the fees and expenses of the transfer
agent of the Fund; the cost of preparing share certificates or any other
expenses, including clerical expenses, incurred in connection with the issue,
sale, underwriting, redemption, or repurchase of shares of the Fund; the
expenses of and fees for registering or qualifying securities for sale; the fees
and expenses of Trustees of the Fund who are not affiliated with you; the cost
of preparing and distributing reports and notices to shareholders; public and
investor relations expenses; or the fees or disbursements of custodians of the
Fund's assets, including expenses incurred in the performance of any obligations
enumerated by the Agreement and Declaration of Trust or By-Laws of the Fund
insofar as they govern agreements with any such custodian.
4. Compensation. As compensation for the services performed and the
facilities furnished and expenses assumed by you, including the services of any
consultants retained by you, each Specified Series shall pay you, as promptly as
possible after the last day of each month, a fee, calculated daily, at the
annual rate of .10 of 1%, or .15 of 1%, as indicated on Exhibit A hereto of the
Specified Series average daily net assets.
The first payment of the fee shall be made as promptly as possible at the end of
the month next succeeding the effective date of this Agreement in respect of
such Specified Series, and shall constitute a full payment of the fee due you
for all services prior to that date. If this Agreement is terminated as of any
date not the last day of a month, such fee shall be paid as promptly as possible
after such date of termination, shall be based on the average daily net assets
of the Specified Series in that period from the beginning of such month to such
date of termination, and shall be that proportion of such average daily net
assets as the number of business days in such period bears to the number of
business days in such month. The average daily net assets of a Specified Series
shall in all cases be based only on business days and be computed as of the time
of the regular close of business of the New York Stock Exchange, or such other
time as may be determined by the Trustees. Each such payment shall be
accompanied by a report of the Fund prepared either by the Fund or by a
reputable firm of independent accountants which shall show the amount properly
payable to you under this Agreement and the detailed computation thereof.
5. Limitation of Liability. You shall not be liable for any error of
judgement or mistake of law or for any loss suffered by the Fund in connection
with the matters to which this Agreement relates except a loss resulting from
willful misfeasance, bad faith, or gross negligence on your part in the
performance of your duties, or from reckless disregard by you of your
obligations and duties under this Agreement. Any person, even though also
employed by you, who may be or become an employee of and paid by the Fund shall
be deemed, when acting within the scope of his or her employment by the Fund, to
be acting in such employment solely for the Fund and not as your employee or
agent.
6. Duration and Termination of this Agreement. This Agreement shall remain
in force until January 31, 2000 and continue from year to year thereafter, but
only so long as such continuance is specifically approved at least annually with
respect to each Specified Series by the vote of a majority of the Trustees who
are not interested persons of you or of the Fund, cast in person at a meeting
called for the purpose of voting on such approval and by a vote of the Trustees.
This Agreement may, on 30 days notice, be terminated at any time without the
payment of any penalty by you, and, immediately upon notice, by the Trustees or,
as to a Specified Series, by vote of a majority of the outstanding voting
securities of that Specified Series. This Agreement shall automatically
terminate in the event of its assignment. In interpreting the provisions of this
Agreement, the definitions contained in Section 2(a) of the 1940 Act, as
modified by rule 18f-2 under the Act (particularly the definitions of
"interested person", "assignment", and "majority of the outstanding voting
securities"), as from time to time amended, shall be applied, subject, however,
to such exemptions as may be granted by the Securities and Exchange Commission
by any rule, regulation, or order.
7. Amendment of this Agreement. No provisions of this Agreement may be
changed, waived, discharged, or terminated orally, but only by an instrument in
writing signed by the party against which enforcement of the change, waiver,
discharge, or termination is sought, and no amendment of this Agreement shall be
effective as to a Specified Series until approved by the Trustees, including a
majority of the Trustees who are not interested persons of you or of the Fund,
cast in person at a meeting called for the purpose of voting on such approval.
8. Miscellaneous. The captions in this Agreement are included for
convenience or reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction of effect. This
Agreement may be executed simultaneously in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
9. Limitation of Liability of the Trustees and Shareholders. A copy of the
Agreement and 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, officers, or shareholders individually but are binding only
upon the assets and property of the appropriate Series.
If you are in agreement with the foregoing, please sign the form of
acceptance on the accompanying counterpart of this letter and return such
counterpart to the Fund, whereupon this letter shall become a binding contract.
Yours very truly,
MENTOR FUNDS
By: ___________________________
Title:
The foregoing Agreement is hereby accepted as of the date thereof.
MENTOR INVESTMENT GROUP, LLC
By: _____________________________
Title:
EXHIBIT A
Series paying .10 of 1%
Mentor Balanced Portfolio
Mentor Income and Growth Portfolio
Mentor High Income Portfolio
Mentor Quality Income Portfolio
Mentor Municipal Income Portfolio
Mentor Short-Duration Income Portfolio
Mentor High Yield Portfolio
Series paying .15 of 1%
Mentor Growth Portfolio
Mentor Capital Growth Portfolio
Mentor Perpetual Global Portfolio
Mentor Perpetual Global Emerging Companies Portfolio
Mentor Value Portfolio
