1
FORM OF ADMINISTRATIVE AND FUND ACCOUNTING AGENCY AGREEMENT
THIS AGREEMENT is made as of [ ] by and between XXXXX BROTHERS XXXXXXXX
& CO., a limited partnership organized under the laws of the State of New York
(the "Administrator"), and _______________________ on behalf of itself and each
subfund thereof listed on Appendix A to this Agreement (each a "Fund" and
collectively, the "Funds").
WITNESSETH:
WHEREAS, the Fund is registered with the United States Securities and
Exchange Commission as a management investment company under the Investment
Company Act of 1940, as amended (the "1940 Act"); and
WHEREAS, the Fund desires to retain the Administrator to render certain
services to the Fund, and the Administrator is willing to render such services.
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, the parties hereto agree as follows:
1. Appointment of Administrator. The Fund hereby employs and appoints the
Administrator to act as its administrative and fund accounting agent on the
terms set forth in this Agreement, and the Administrator accepts such
appointment.
2. Delivery of Documents. The Fund will:
2.1 Furnish the Administrator with properly certified or authenticated
copies of resolutions of the Fund's Board of Directors or Trustees
authorizing the appointment of the Administrator as administrative and
fund accounting agent of the Fund and approving this Agreement.
2.2 Provide the Administrator with any other documents or resolutions
(including but not limited to directions or resolutions of the Fund's
Board of Directors or Trustees) which relate to or affect the
Administrator's performance of its duties hereunder or which the
Administrator may at any time reasonably request.
2.3 Notify the Administrator promptly of any matter affecting the
performance by the Administrator of its
services under this Agreement.
3. Duties as Administrator. Subject to the supervision and direction of the
Fund's Board of Directors or Trustees, the Administrator will perform the
following administrative services: 3.1 Maintain office facilities for the Fund,
which may be in the offices of the Administrator or a corporate
affiliate of the Administrator;
3.2 Perform all functions ordinarily performed by the office of a corporate
treasurer, and furnish the services and facilities ordinarily incident
thereto as described in Appendix B to this Agreement;
3.3 Perform the functions ordinarily performed by a mutual fund group's
internal legal department as described in Appendix B to this Agreement,
furnishing data processing services, clerical services and executive
and administrative services and standard stationery and office supplies
in connection with the foregoing;
3.4 Assist the Fund's investment adviser (the "Adviser"), at the Adviser's
request, in monitoring and developing compliance procedures for the
Fund which will include, among other matters, procedures to assist the
Adviser in monitoring compliance with the Fund's investment objectives,
policies and restrictions, tax matters and applicable laws and
regulations and performing certain monthly compliance tests, to the
extent relevant information is available to the Administrator in the
performance of its functions as the Fund's net asset value calculation
agent.
3.5 Assist the Fund's Treasurer in preparing the Fund's performance
analysis reports (including yield and total return information)
calculated in accordance with applicable U. S. securities laws and in
reporting to external databases such information as may reasonably be
requested.
3.6 Select and monitor an independent service supplier to provide for
reasonable and necessary monitoring of compliance with the securities
regulations of the fifty states of the United States on such terms as
the Fund may direct, or in the absence of such direction, as the
Administrator shall reasonably deem appropriate, provided however, that
such arrangement shall require that such service supplier act with
reasonable care in the discharge of its duties. The Administrator shall
deliver to the Fund, or cause to be delivered to the Fund, regular
reports and notices with respect to blue sky compliance and shall be
responsible to use reasonable efforts to enforce the terms of the
agreement with the service supplier on the Fund's behalf. The Fund
shall be responsible to provide copies of its prospectus and other
relevant documents and information relating to the Fund as may be
reasonably required for the performance of state securities law
compliance.
3.7 Assist the Fund's officers and Adviser in such other matters as the
Funds and the Administrator shall from time to time agree. In
performing its duties and obligations hereunder, the Administrator will
act in accordance with the
Fund's Articles of Incorporation or Declaration of Trust, By-laws and Prospectus
and Proper Instructions. It is agreed and understood, however, that the
Administrator shall not be responsible for compliance the Fund's investments
with any applicable documents, laws or regulations, or for losses, costs or
expenses arising out of the Fund's failure to comply with said documents, laws
or regulations or the Fund's failure or inability to correct any non-compliance
therewith.
4. Duties as Fund Accounting Agent. Subject to the supervision and direction of
the Fund's Board of Directors or Trustees, the Administrator will perform the
following fund accounting services:
4.1 Compute and determine the net asset value per share of the Fund as
of the close of business on the New York Stock Exchange on each day on
which such Exchange is open, unless otherwise directed by Proper
Instruction. Such computation and determination shall be made in
accordance with the provisions of the Fund's Declaration of Trust or
Certificate of Incorporation and By-Laws, as they may from time to time
be amended and delivered to the Administrator, the votes of the Fund's
Board of Directors or Trustees at the time in force and applicable, as
they may from time to time be delivered to the Administrator, the
Fund's current prospectus and statement of additional information or
proper Instructions, including without limitation any information:
4.1.1 as to accrual of liabilities of the Fund and as to liabilities of
the Fund not appearing on the books of account kept by the
Administrator;
4.1.2 as to the existence, status and proper treatment of reserves, if any,
authorized by the Fund; 4.1.3 as to the sources of quotations to be used in
computing the net asset value, including those listed in
Appendix C hereto;
4.1.4 as to the fair value to be assigned to any securities or other
property for which price quotations are not readily available;
4.1.5 as to the sources of information with respect to "corporate
actions" affecting portfolio securities of the Fund, including
those listed in Appendix C. (Information as to "corporate
actions" shall include information as to dividends,
distributions, stock splits, stock dividends, rights
offerings, conversions, exchanges, recapitalizations, mergers,
redemptions, calls, maturity dates and similar transactions,
including the ex- and record dates and the amounts or other
terms thereof.); and
4.1.6 as to the use a particular source for the valuation of a specific
Security or other Property of the Fund.
4.2 Compute and determine the net asset value as of such other times as the
Fund's Board of Directors or Trustees from time to time may reasonably
request.
4.3 Create, maintain and retain such records relating to its obligations
under this Agreement as are required under the 1940 Act (including
Section 31 thereof and Rules 31a-1 and 31a-2 thereunder). 4.4 Provide
the Adviser with written reports which the Adviser will use to verify
that portfolio transactions have been recorded in accordance with the
Fund's instructions and reconcile with the Fund's trading records on
each day that the Administrator shall compute the net asset value per
share of the Fund.
Notwithstanding anything in this Agreement to the Contrary, the
Administrator shall not be responsible for the failure of the Fund or its
Adviser to provide the Administrator with Proper Instructions regarding
liabilities which ought to be included in the calculation of the Fund's net
asset value.
5. Expenses and Compensation. For the services to be rendered and the facilities
to be furnished by the Administrator as provided for in this Agreement, the Fund
shall pay the Administrator for its services rendered pursuant to this Agreement
a fee based on such fee schedule as may from time to time be agreed upon in
writing by the Fund and the Administrator. In addition to such fee, the
Administrator shall xxxx the Fund separately for any out-of-pocket disbursements
of the Administrator based on an out-of-pocket schedule as may from time to time
be agreed upon in writing by the Fund and the Administrator. The foregoing fees
and disbursements shall be billed to the Fund by the Administrator and shall be
paid promptly by wire transfer or other appropriate means to the Administrator.
6. Standard of Care. The Administrator shall be held only to the exercise of
reasonable care and diligence in carrying out the provisions of this Agreement,
provided that the Administrator shall not thereby be required to take any action
which is in contravention of any applicable law, rule or regulation or any order
or judgment of any court of competent jurisdiction.
7. Limitation of Liability. The Administrator shall incur no liability with
respect to any telecommunications, equipment or power failures, or any failures
to perform or delays in performance by postal or courier services or third-party
information providers (including without limitation those listed on Appendix C).
The Administrator shall also incur no liability under this Agreement if the
Administrator or any agent or entity utilized by the Administrator shall be
prevented, forbidden or delayed from performing, or omits to perform, any act or
thing which this Agreement provides shall be performed or omitted to be
performed, by reason of causes or events beyond its control, including but not
limited to:
7.1 any Sovereign Event. A "Sovereign Event" shall mean any
nationalization; expropriation; devaluation; revaluation; confiscation;
seizure; cancellation; destruction; strike; act of war, terrorism,
insurrection or revolution; or any other act or event beyond the
Administrator's control;
7.2 any provision of any present or future law, regulation or order of the
United States or any state thereof, or of any foreign country or
political subdivision thereof, or of any securities depository or
clearing agency; and
7.3 any provision of any order or judgment of any court of competent
jurisdiction.
Notwithstanding any other provision of this Agreement, the
Administrator shall not be held accountable or liable for any losses, damages or
expenses the Fund or any shareholder or former shareholder of the Fund or any
other person may suffer or incur arising from acts, omissions, errors or delays
of the Administrator in the performance of its obligations and duties hereunder,
including without limitation any error of judgment or mistake of law, except a
damage, loss or expense resulting from the Administrator's willful malfeasance,
bad faith or negligence in the performance of such obligations and duties. The
parties hereto acknowledge, however, that the Administrator's causing an error
or delay in the determination of net asset value may, but does not in and of
itself, constitute negligence or reckless or willful misconduct. The
Administrator shall in no event be required to take any action, which is in
contravention of any applicable law, rule or regulation or any order or judgment
of any court of competent jurisdiction.
In no event shall the Administrator be liable or responsible to the
Fund, any present or former shareholder of the Fund, or any other person for any
error or delay which continued or was undetected after the date of an audit
performed by the certified public accountants employed by the Fund if, in the
exercise of reasonable care in accordance with generally accepted accounting
standards, such accountants should have become aware of such error or delay in
the course of performing such audit. The Administrator's liability for any such
negligence or reckless or willful misconduct which results in an error in
determination of such net asset value shall be limited exclusively to the
direct, out-of-pocket loss the Fund shall actually incur, measured by the
difference between the actual and the erroneously computed net asset value, and
any expenses the Fund shall incur in connection with correcting the records of
the Fund affected by such error (including charges made by the Fund's registrar
and transfer agent for making such corrections) or communicating with
shareholders or former shareholders of the Fund affected by such error. In no
event and under no circumstances shall the Administrator or a Fund be held
liable to the other party for consequential or indirect damages, loss of
profits, damage to reputation or business or any other special damages arising
under or by reason of any provision of this Agreement or for any act or omission
hereunder.
Without limiting the foregoing, the Administrator shall not be held
accountable or liable to the Fund, any shareholder or former shareholder thereof
or any other person for any delays or losses, damages or expenses any of them
may suffer or incur resulting from (i) the Administrator's failure to receive
timely and suitable notification concerning quotations or corporate actions
relating to or affecting portfolio securities of the Fund or (ii) any errors in
the computation of the net asset value based upon or arising out of quotations
or information as to corporate actions if received by the Administrator either
(a) from a source which the Administrator was authorized to rely upon (including
those sources listed on Appendix C), (b) from a source which in the
Administrator's reasonable judgment was as reliable a source for such quotations
or information as such authorized sources, or (c) relevant information known to
the Fund or the Adviser which would impact the calculation of net asset value
but which is not communicated by the Fund or the Adviser to the Administrator.
In the event of any error or delay in the determination of such net
asset value for which the Administrator may be liable, the Funds and the
Administrator will consult and make good faith efforts to reach agreement on
what actions should be taken in order to mitigate any loss suffered by the Fund
or its present or former shareholders, in order that the Administrator's
exposure to liability shall be reduced to the extent possible after taking into
account all relevant factors and alternatives. It is understood that in
attempting to reach agreement on the actions to be taken or the amount of the
loss which should appropriately be borne by the Administrator, the Fund and the
Administrator will consider such relevant factors as the amount of the loss
involved, the Fund's desire to avoid loss of shareholder good will, the fact
that other persons or entities could have been reasonably expected to have
detected the error sooner than the time it was actually discovered, the
appropriateness of limiting or eliminating the benefit which shareholders or
former shareholders might have obtained by reason of the error, and the
possibility that other parties providing services to the Fund might be induced
to absorb a portion of the loss incurred. The Fund hereby agrees to indemnify
the Administrator against and hold it harmless from any and all losses, claims,
damages, liabilities or expenses (including reasonable counsel fees and
expenses) resulting from any act, omission, error or delay or any claim, demand,
action or suit, in connection with or arising out of performance of its
obligations and duties under this Agreement, not resulting from the willful
malfeasance, bad faith or negligence of the Administrator in the performance of
such obligations and duties.
8. Reliance by the Administrator on Proper Instructions and Opinions of Counsel
and Opinions of Certified Public Accountants. The Administrator shall not be
liable for, and shall be indemnified by the Fund against any and all losses,
costs, damages or expenses arising from or as a result of, any action taken or
omitted in reliance upon Proper Instructions or upon any other written notice,
request, direction, instruction, certificate or other instrument believed by it
to be genuine and signed or authorized by the proper party or parties.
Proper Instructions shall include a written request, direction,
instruction or certification signed or initialed on behalf of the Fund by one or
more persons as the Board of Directors or Trustees of the Fund shall have from
time to time authorized. Those persons authorized to give Proper Instructions
may be identified by the Board of Directors or Trustees by name, title or
position and will include at least one officer empowered by the Board to name
other individuals who are authorized to give Proper Instructions on behalf of
the Fund.
Telephonic or other oral instructions or instructions given by telefax
transmission may be given by any one of the above persons and will also be
considered Proper Instructions if the Administrator believes them to have been
given by a person authorized to give such instructions with respect to the
transaction involved.
With respect to telefax transmissions, the Fund hereby acknowledges
that (i) receipt of legible instructions cannot be assured, (ii) the
Administrator cannot verify that authorized signatures on telefax instructions
are original, and (iii) the Administrator shall not be responsible for losses or
expenses incurred through actions taken in reliance on such telefax
instructions. The Fund agrees that such telefax instructions shall be conclusive
evidence of the Fund's Proper Instruction to the Administrator to act or to omit
to act.
Proper Instructions given orally will be confirmed by written
instructions in the manner set forth above, including by telefax, but the lack
of such confirmation shall in no way affect any action taken by the
Administrator in reliance upon such oral instructions. The Fund authorizes the
Administrator to tape record any and all telephonic or other oral instructions
given to the Administrator by or on behalf of the Fund (including any of its
officers, directors, trustees, employees or agents or any investment manager or
adviser or person or entity with similar responsibilities which is authorized to
give Proper Instructions on behalf of the Fund to the Administrator.)
The Administrator may consult with its counsel or the Fund's counsel in
any case where so doing appears to the Administrator to be necessary or
desirable. The Administrator shall not be considered to have engaged in any
misconduct or to have acted negligently and shall be without liability in acting
upon the advice of its counsel or of the Fund's counsel.
The Administrator may consult with a certified public accountant or the
Fund's Treasurer in any case where so doing appears to the Administrator to be
necessary or desirable. The Administrator shall not be considered to have
engaged in any misconduct or to have acted negligently and shall be without
liability in acting upon the advice of such certified public accountant or of
the Fund's Treasurer.
9. Termination of Agreement. This Agreement shall have an initial term
of three (3) years from the date hereof. Thereafter, this Agreement shall
automatically renew for successive one (1) year periods unless either party
terminates this Agreement by written notice effective no sooner than
seventy-five (75) days following the date that notice to such effect shall be
delivered to the other party at its address set forth herein. Notwithstanding
the foregoing provisions, either party may terminate this Agreement at any
time upon thirty (30) days written notice to the other party in the event that
the either party is adjudged bankrupt or insolvent, or there shall be
commenced against such party a case under any applicable bankruptcy,
insolvency, or other similar law now or hereafter in effect. In the event a
termination notice is given by a party hereto, all expenses associated with
the movement of records and materials and the conversion thereof shall be paid
by the Fund for which services shall cease to be performed hereunder. The
Accounting Agent shall be responsible for completing all actions in progress
when such termination notice is given unless otherwise agreed.
This Section 9 shall survive any termination of this Agreement, whether
for cause or not for cause.
10. Amendment of this Agreement. This Agreement constitutes the entire
understanding and agreement of the parties hereto with respect to the subject
matter hereof. No provision of this Agreement may be amended or terminated
except by a statement in writing signed by the party against which enforcement
of the amendment or termination is sought.
In connection with the operation of this Agreement, the Fund and the
Administrator may agree in writing from time to time on such provisions
interpretive of or in addition to the provisions of this Agreement as may in
their joint opinion be consistent with the general tenor of this Agreement. No
interpretive or additional provisions made as provided in the preceding sentence
shall be deemed to be an amendment of this Agreement.
In the event any provision of this Agreement is determined to be void
or unenforceable, such determination shall not affect the remainder of this
Agreement, which shall continue to be in force.
The section headings and the use of defined terms in the singular or
plural tenses in this Agreement are for the convenience of the parties and in no
way alter, amend, limit or restrict the contractual obligations of the parties
set forth in this Agreement.
11. Governing Law. This Agreement shall be governed by and construed according
to the laws of the Commonwealth of Massachusetts without giving effect to
conflicts of laws principles.
12. Notices. Notices and other writings delivered or mailed postage prepaid to
the Fund addressed to the Fund at [ ] or to such other address as the Fund may
have designated to the Administrator in writing, or to the Administrator at 00
Xxxxx Xxxxxx, Xxxxxx, XX 00000, Attention: Manager, Fund Administration
Department, or to such other address as the Administrator may have designated to
the Fund in writing, shall be deemed to have been properly delivered or given
hereunder to the respective addressee.
13. Binding Effect. This Agreement shall be binding upon and inure to the
benefit of the Fund and the Administrator and their respective successors and
assigns, provided that no party hereto may assign this Agreement or any of its
rights or obligations hereunder without the written consent of the other party.
14. Counterparts. This Agreement may be executed in any number of counterparts
each of which shall be deemed to be an original and which collectively shall be
deemed to constitute only one instrument. This Agreement shall become effective
when one or more counterparts have been signed and delivered by each of the
parties.
15. Exclusivity. The services furnished by the Administrator hereunder are not
to be deemed exclusive, and the Administrator shall be free to furnish similar
services to others.
16. Authorization. The Fund hereby represents and warrants that the Fund's Board
of Directors or Trustees has authorized the execution and delivery of this
Agreement and that an authorized officer of the Fund has signed this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their duly authorized officers as of the date
first written above. The undersigned acknowledges that (I/we) have received a
copy of this document
XXXXX BROTHERS XXXXXXXX & CO. ______________________________________
By: __________________________________ By: ________________________________
Name: Name:
Title: Title:
Date: Date:
APPENDIX A
TO
ADMINISTRATIVE AND FUND ACCOUNTING AGENCY AGREEMENT
Dated as of ____________________________
---------------------
The following is a list of Investment Companies for which the Administrator
shall serve under a Administrative and Accounting Agency Agreement dated as of [
]:
APPENDIX B TO
ADMINISTRATIVE AND FUND ACCOUNTING AGENCY AGREEMENT
Financial Administration Services
Treasurer's Support Services:
o Provide an Assistant Treasurer to the Fund.
o Accumulate information for and, subject to approval by the Funds'
Treasurer, prepare reports to the Funds' shareholders of record as set
forth in Rule 30d-1 of the 1940 Act or as agreed upon in writing from time
to time between the parties hereto and file such reports with the
Securities and Exchange Commission.
o Prepare and file the Rule 24f-2 Notice and Form N-SAR with the Securities and
Exchange Commission. o Consult with the Funds' Treasurer on financial matters
relating to the Funds including without
limitation dividend distributions, expense proformas, expense accruals and
other matters, including payment of expenses, as shall from time to time be
agreed upon by the parties.
o Assist the Fund's Treasurer in the preparation of quarterly reporting to
the Fund's Board of Directors or Trustees as required by applicable rules
under the 1940 Act and as agreed between the Administrator and the Funds
from time to time.
o Report monthly to the Fund's Treasurer on compliance of the Fund's fidelity
bond coverage with Rule 17g-1 of the 1940 Act.
o Report monthly to Treasurer on comparison of the Fund's actual shares
outstanding with its authorized shares.
Tax Services:
o Assist the Fund's Treasurer with the Fund's federal, state and applicable
local tax preparation and reporting, including the following:
o preparation of fiscal and excise tax distribution calculations;
o preparation and filing of federal, state and any local income
tax returns, including tax return
extension requests;
o preparation of shareholder year end reporting statements;
o provide the appropriate amounts and characterization of
distributions declared during the calendar year
for Forms 1099 reporting;
o periodically review and determine of distributions to be paid to shareholders;
o consult with the Fund's Treasurer regarding potential passive foreign
investment companies; and o consult with the Fund's Treasurer on various tax
issues as they arise and with the Fund's outside
auditors when appropriate.
CORPORATE SECRETARIAL Services:
o Maintain corporate documents and files.
o Monitor good standing of the Fund in its state of organization.
o Provide Assistant Secretary for the Fund.
o Maintain corporate calendar for regulatory matters and Board approvals.
o Prepare Board and Shareholder meeting materials, including scripts,
agendas, resolutions, memoranda, minutes.
o Attend Board and Shareholder meetings; take minutes of the meetings; make
presentations as required. follow up on matters raised at the meetings.
o Coordinate and monitor shareholder vote solicitation and tabulation with the
Fund's transfer agent.
REGULATORY SERVICES:
o Prepare and submit annual and special filings to the SEC including updates
to fund registration statements and routine proxy statements.
o Prepare supplements and stickers to registration statements and file
the same with the SEC.
o Review and comment on shareholder communications including annual,
semi-annual and quarterly reports, president's letters,
advertising and sales literature.
o Assist in filing advertising and sales literature with the NASD.
CONSULTATIVE SERVICES:
o Maintain and communicate awareness of regulatory proposals and changes to fund
management. o Assist in developing compliance procedures to address regulatory
changes. o Act as liaison with internal counsel, fund counsel, and fund
auditors.
APPENDIX C TO
ADMINISTRATIVE AND FUND ACCOUNTING AGENCY AGREEMENT
[ Fund to provide list of sources for quotations to be used for pricing and
corporate actions]
