Exhibit (h)(iii)
ADMINISTRATION AGREEMENT
This Administration Agreement is made as of this March 1, 1999 between XXXXXX
XXXX MUTUAL FUNDS, a Delaware business trust (herein called the "Company"), and
XXXXXX XXXX INVESTORS, INC., a Delaware corporation (herein called the
"Administrator").
WHEREAS, the Company wishes to retain the Administrator under this Agreement to
render administrative services to the portfolios of the Company known as Small
Cap Growth Fund, International Equity Fund, Socially Responsible Fund, Growth
Fund, Balanced Fund, Short-Term Fund and Income Fund (the "Initial Fund(s)",
together with any other Company portfolios which may be established later and
served by the Administrator hereunder, being herein referred to collectively as
the "Funds" and individually as a "Fund"); and
WHEREAS, the Company desires to retain the Administrator to provide
administrative services for the Funds, and the Administrator is willing to
render such services;
NOW THEREFORE, in consideration of the premises and mutual covenants set forth
herein, the parties hereto agree as follows:
1. APPOINTMENT OF ADMINISTRATOR
(A) The Company hereby appoints the Administrator as administrator of each
Fund on the terms and for the period set forth in this Agreement and the
Administrator hereby accepts such appointment and agrees to perform the
services and duties set forth herein on the terms herein provided. The
Administrator may, in its discretion, provide such services through its own
employees or the employees of one or more affiliated companies that are
qualified to provide such services to the Trust under applicable law and
are under common control with the Administrator provided (i) that all
persons, when providing services hereunder, are functioning as part of an
organized group of persons, and (ii) that such organized group of persons
is managed at all times by authorized officers of the Administrator.
(B) In the event that the Company establishes one or more portfolios other
than the Initial Fund(s) with respect to which it desires to retain the
Administrator to render investment advisory and management services
hereunder, it shall notify the Administrator in writing. If the
Administrator is willing to render such services, it shall notify the
Company in writing whereupon such portfolio or portfolios shall become a
Fund or Funds hereunder.
2. ADMINISTRATIVE SERVICES AND DUTIES. Subject to the supervision and control of
the Company's Board of Trustees, the Administrator shall provide to the Company
facilities, equipment, statistical and research data, clerical, accounting and
bookkeeping services, internal auditing and legal services, and personnel to
carry out all administrative services required for operation of the business and
affairs of the Funds other than those services to be performed by a distributor
of the Funds' shares pursuant to a Distribution Agreement, those services to be
performed by the Funds, custodian pursuant to the Company's Custody Agreement,
those services to be performed by the Funds' transfer agent pursuant to the
Company's Transfer Agency Agreement, those accounting services to be provided
pursuant to an accounting agreement or custody agreement and those services
normally performed by the Company's counsel and auditors.
(A) The Administrator's oversight responsibilities shall include:
(1) Overseeing the performance of the Custodian under the
Custody Agreement with respect to the Funds; and
(2) Overseeing the performance of the Transfer Agent under
the Transfer Agency Agreement with respect to the Funds.
(B) The Administrator shall participate in the periodic updating of the
Funds' prospectuses and statements of additional information and shall
accumulate information for and, subject to approval by the Company's
Treasurer and legal counsel, coordinate the preparation, filing, printing
and dissemination of reports to the Funds' shareholders and the Securities
and Exchange Commission (the "Commission"), including but not limited to
annual reports and semi-annual reports on Form N-SAR, notices pursuant to
Rule 24f-2 and proxy materials pertaining to the Funds.
(C) The Administrator shall calculate dividends and capital gain
distributions to be paid by each Fund in conformity with subchapter M of
the Internal Revenue Code of 1986, as amended.
(D) The Administrator shall pay all costs and expenses of maintaining the
offices of the Company, wherever located, and shall arrange for payment by
the Company of all expenses payable by the Company.
(E) The Administrator shall maintain such other books and records with
respect to the Funds as may be required by law or may be required for the
proper operation of the business and affairs of the Funds, other than those
required to be maintained under the Fund Accounting Agreement and by the
Administrator under Section 3 of this Agreement. Without limiting the
foregoing, the Administrator shall be responsible for the proper
maintenance of the records to be maintained by it, throughout the term of
this Agreement.
(F) The Administrator shall prepare the Funds' federal, state and local
income tax returns.
(G) The Administrator shall prepare and, subject to approval of the
Company's Treasurer, disseminate to the Company's trustees each Fund's
quarterly financial statements and shall prepare such other reports
relating to the business and affairs of the Funds (not otherwise
appropriately prepared by the Company's counsel, auditors or other Company
service providers) as the officers and trustees of the Company may from
time to time reasonably request in connection with performance of their
duties.
(H) The Administrator shall assist the Custodian, Transfer Agent, counsel
and auditors as required to carry out the business and operations of the
Funds.
3. COMPLIANCE WITH GOVERNING INSTRUMENTS AND LAWS. In performing its duties as
Administrator for the Funds, the Administrator shall act in conformity with the
Company's Declaration of Trust, Bylaws, prospectuses and statements of
additional information, and the instructions and directions of the Board of
Trustees of the Company. In addition, the Administrator shall conform to and
comply with the requirements of the 1940 Act, the Rules and Regulations of the
Commission, the requirements of subchapter M and Section 817(h) of the Internal
Revenue Code of 1986, as amended, and all other applicable federal or state laws
and regulations.
4. SERVICES NOT EXCLUSIVE. The Administrator shall for all purposes herein be
deemed to be an independent contractor and shall, unless otherwise expressly
provided herein or authorized by the Board of Trustees from time to time, have
no authority to act for or represent the Company in any way or otherwise be
deemed its agent. The services furnished by the Administrator hereunder are not
deemed exclusive, and the Administrator shall be free to furnish similar
services to others so long as its services under this Agreement are not impaired
thereby.
5. BOOKS AND RECORDS. In compliance with the requirements of Rule 31a-3 under
the 1940 Act, the Administrator hereby agrees that all records which it
maintains for the Company are the property of the Company and further agrees to
surrender promptly to the Company any such records upon the Company's request.
The Administrator further agrees to preserve for the periods prescribed by Rule
31a-2 under the 1940 Act the records required to be maintained by Rule 31a-1
under the 1940 Act.
6. SUBCONTRACTORS. It is understood that the Administrator may from time to time
employ or associate with itself such person or persons as the Administrator may
believe to be particularly fitted to assist in the performance of this
Agreement; provided, however, that the compensation of such person or persons
shall be paid by the Administrator and that the Administrator shall be as fully
responsible to the Company for the acts and omissions of any subcontractor as it
is for its own acts and omissions. Without limiting the generality of the
foregoing, it is understood that the Administrator and the Company have entered
into an agreement with the Fund Accountant under which said institution will
provide certain accounting, bookkeeping, pricing and dividend and distribution
calculation services with respect to the Funds at the expense of the Funds.
7. EXPENSES ASSUMED AS ADMINISTRATOR. Except as otherwise stated in this
Agreement, the Administrator shall pay all expenses incurred by it in performing
its services and duties hereunder as Administrator. The Company shall bear other
expenses incurred in the operation of the Funds, including without limitation
taxes, interest, brokerage fees and commissions, if any, fees of trustees who
are not officers, directors, partners, employees or holders of 5 percent or more
of the outstanding voting securities of the Administrator or any of its
affiliates, Commission fees and state blue sky registration and qualification
fees, charges of custodians, transfer and dividend disbursing agents' fees,
certain insurance premiums, outside auditing and legal expenses, costs of
maintaining the trust existence, costs of preparing and printing prospectuses or
any supplements or amendments thereto necessary for the continued effective
registration of the Shares under federal or state securities laws, costs of
printing and distributing any prospectus, supplement or amendment thereto for
existing shareholders of the Funds described therein, costs of shareholders'
reports and meetings, and any extraordinary expenses. It is understood that
certain advertising, marketing, shareholder servicing, administration and/or
distribution expenses to be incurred in connection with the Shares may be paid
by the Company as provided in any plan which may in the sole discretion of the
Company be adopted in accordance with Rule 12b-1 under the 1940 Act, and that
such expenses shall be paid apart from any fees paid under this Agreement.
8. COMPENSATION. For the services provided and the expenses assumed pursuant to
this Agreement, the Company shall pay the Administrator a fee, computed daily
and payable monthly, at the annual rate as set forth in the attached fee
schedule based on the average net assets of each Fund. Such fee as is
attributable to each Fund shall be a separate (and not joint or joint and
several) obligation of each such Fund. Notwithstanding anything to the contrary
herein, if in any fiscal year the aggregate expenses of any Fund (as defined
under the securities regulations of any state having
jurisdiction over such Fund) exceed the expense limitations of any such state,
the Company may deduct from the fees to be paid pursuant to this Agreement, or
the Administrator shall bear such excess, to the extent required by state law.
Such deduction or payment, if any, will be estimated and accrued daily and paid
on a monthly basis.
9. CONFIDENTIALITY. The Administrator shall treat confidentially and as
proprietary information of the Company all records and other information
relative to the Company and prior or present shareholders or those persons or
entities who respond to the Distributor's inquiries concerning investment in the
Company, and shall not use such records and information for any purpose other
than performance of its responsibilities and duties hereunder or under any other
agreement with the Company except after prior notification to and approval in
writing by the Company, which approval shall not be unreasonably withheld and
may not be withheld where the Administrator may be exposed to civil or criminal
contempt proceedings for failure to comply, when requested to divulge such
information by duly constituted authorities, or when so requested by the
Company. Nothing contained herein, however, shall prohibit the Administrator
from advertising to or soliciting the public generally with respect to other
products or services, including, but not limited to, any advertising or
marketing via radio, television, newspapers, magazines or direct mail
solicitation, regardless of whether such advertisement or solicitation may
coincidentally include prior or present Company shareholders or those persons or
entities who have responded to inquiries with respect to the Funds.
10. LIMITATIONS OF LIABILITY. Subject to the provisions of Section 7 hereof
concerning the Administrator's responsibility for the acts and omissions of
persons employed or associated with the Administrator, the Administrator shall
not be liable for any error of judgment or mistake of law or for any loss
suffered by the Company or by any Fund in connection with the matters to which
this Agreement relates, except a loss resulting from a breach of fiduciary duty
with respect to the receipt of compensation for services or a loss resulting
from willful misfeasance, bad faith or negligence on its part in the performance
of its duties or from reckless disregard by it of its obligations and duties
under this Agreement. Any person, even though also an officer, director,
employee or agent of the Administrator, who may be or become an officer,
director, employee or agent of the Company, shall be deemed when rendering
services to the Company or to any Fund, or acting on any business of the Company
or of any Fund (other than services or business in connection with the
Administrator's duties as Administrator hereunder or under any other agreement
with the Company) to be rendering such services to or acting solely for the
Company or Fund and not as an officer, director, employee or agent or one under
the control or direction of the Administrator even though paid by the
Administrator.
The Administrator acknowledges and agrees that the Declaration of Trust of the
Company provides that the Trustees of the Company and the officers of the
Company executing this Agreement on behalf of the Company shall not be
personally bound hereby or liable hereunder, nor shall resort be had to their
private property or the private property of the shareholders of the Company for
the satisfaction of
any claim or obligation under this Agreement.
11. DURATION OR TERMINATION. This Agreement shall become effective as of the
date first written above and, unless sooner terminated as provided herein, shall
continue until October 31, 1999. Thereafter, this Agreement will be extended
with respect to a particular Fund for successive one-year periods ending on
October 31st of each year provided each such extension is specifically approved
at least annually (a) by vote of a majority of those members of the Company's
Board of Trustees who are not interested persons of any party to this Agreement,
cast in person at a meeting called for
the purpose of voting on such approval, and (b) by the Company's Board of
Trustees or by vote of a majority of the outstanding voting securities of such
Fund. This Agreement may be terminated by the Company at any time with respect
to any Fund, without the payment of any penalty, by vote of a majority of the
entire Board of Trustees of the Company or by a vote of a majority of the
outstanding voting securities of such Fund on 60 days' written notice to the
Administrator, or by the Administrator at any time, without payment of penalty,
on 60 days' written notice to the Company. This Agreement will immediately
terminate in the event of its assignment. As used in this Agreement, the terms
"majority of the outstanding voting securities," "interested persons" and
"assignment" shall have the same meanings as such terms have in the 1940 Act.
12. NAMES. The name "Xxxxxx Xxxx Mutual Funds" refers to the trust created and
the trustees, as trustees but not individually or personally, acting from time
to time under a Declaration of Trust dated November 7, 1996, as amended, which
is hereby referred to and a copy of which is on file at the principal office of
the Company. The trustees, officers, employees and agents of the Company shall
not personally be bound by or liable under any written obligation, contract,
instrument, certificate or other interest or undertaking of the Company made by
the trustees or by any officer, employee or agent of the Company, in his or her
capacity as such, nor shall resort be had to their private property for the
satisfaction of any obligation or claim thereunder. All persons dealing with any
series or class of shares of the Company may enforce claims against the Company
only against the assets belonging to such series or class.
13. NOTICES. Notices of any kind to be given to the Company hereunder by the
Administrator shall be in writing and shall be duly given if mailed or delivered
to the Company at the following:
Xxxxxx X. Xxxx
President, Xxxxxx Xxxx Mutual Funds
0 Xxxxxx Xxxx Xxxxx
Xxxxxxxxxxx, Xxxxxxxx 00000
With a copy to:
Xxxxx X. X'Xxxxx, Esq.
Vedder, Price, Xxxxxxx & Kammholz
000 Xxxxx XxXxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
or at such other address or to such individual as shall be so specified by the
Company to the Administrator. Notices of any kind to be given to the
Administrator hereunder by the Company shall be in writing and shall be duly
given if mailed or delivered to the Administrator at:
A. Xxxxxx Xxxxxxx
President, Xxxxxx Xxxx Investors, Inc.
0 Xxxxxx Xxxx Xxxxx
Xxxxxxxxxxx, Xxxxxxxx 00000
or at such other address or to such individual as shall be so specified by the
Administrator to the Company.
14. MISCELLANEOUS. The captions in this Agreement are included for convenience
of reference only and in no way define or delimit any of the provisions hereof
or otherwise affect their construction or effect. If any provision of this
Agreement shall be held or made invalid by a court decision, statute, rule or
otherwise, the remainder of this Agreement shall not be affected thereby.
Subject to the provisions of Section 12 hereof, this Agreement shall be binding
upon and shall inure to the benefit of the parties hereto and their respective
successors and shall be governed by Delaware law (without regard to principles
of conflicts of law); provided, however, that nothing herein shall be construed
in a manner inconsistent with the 1940 Act or any rule or regulation of the
Commission thereunder.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed by their officers designated below as of the day and year first above
written.
XXXXXX XXXX MUTUAL FUNDS
By:_________________________
(name) Xxxxxx X. Xxxx
(title) President
Attest:_____________________
(name) Xxx X. Xxxxxxxx
(title) Secretary
XXXXXX XXXX INVESTORS, INC.
By:________________________
(name) A. Xxxxxx Xxxxxxx
(title) President
Attest:____________________
(name) Xxxxx X. Xxxxx
(title) Assistant Secretary
