ADMINISTRATION AGREEMENT
THIS ADMINISTRATION AGREEMENT is made as of September 20,
1997 (the "Agreement"), by and between FIRST DATA INVESTOR
SERVICES GROUP, INC., a Massachusetts corporation ("FDISG"), and
FIRST CHOICE FUNDS TRUST, a Delaware business trust (the
"Company").
WHEREAS, the Company is registered as an open-end management
investment company under the Investment Company Act of 1940, as
amended (the "1940 Act"); and
WHEREAS, the Company desires to retain FDISG to render
certain administrative services with respect to each investment
portfolio listed in Schedule A hereto, as the same may be amended
from time to time by the parties hereto (collectively, the
"Funds"), and FDISG is willing to render such services;
WITNESSETH:
NOW, THEREFORE, in consideration of the premises and mutual
covenants herein contained, it is agreed between the parties
hereto as follows:
1. Appointment. The Company hereby appoints FDISG to act
as Administrator of the Company on the terms set forth in this
Agreement. FDISG accepts such appointment and agrees to render
the services herein set forth for the compensation herein
provided. In the event that the Company decides to retain FDISG
to act as Administrator hereunder with respect to one or more
portfolios other than the Funds, the Company shall notify FDISG in
writing. If FDISG is willing to render such services, it shall
notify the Company in writing whereupon such portfolio shall
become a Fund hereunder.
2. Delivery of Documents. The Company has furnished
FDISG with copies properly certified or authenticated of each of
the following:
(a) Resolutions of the Company's Board of Trustees
authorizing the appointment of FDISG to provide certain
administrative services required by the Company for each Fund and
approving this Agreement;
(b) The Company's Declaration of Trust (the
"Declaration of Trust") filed with the State of Delaware and all
amendments thereto;
(c) The Company's By-Laws and all amendments thereto
(the "By-Laws");
(d) The Investment Advisory Agreement between First
American Capital Management, Inc. (the "Adviser") and the Company
dated as of August 23, 1997, and all amendments thereto (the
"Advisory Agreement");
(e) The Custody Agreement between IFTC (the "Custodian")
and the Company dated as of October 1, 1996, and all amendments
thereto (the "Custody Agreement");
(f) The Transfer Agency and Registrar Agreement
between First Data Investor Services Group, Inc. (the "Transfer
Agent") and the Company dated as of September 20, 1997, and all
amendments thereto;
(g) The Distribution Agreement between First Data
Distributors, Inc. (the "Distributor") and the Company dated as of
September 20, 1997, and all amendments thereto (the "Distribution
Agreement");
(h) The Company's Registration Statement on Form N-
1A (the "Registration Statement") under the Securities Act of 1933
and under the 1940 Act (File Nos. 33-07085 and 811-07681), as
declared effective by the Securities and Exchange Commission
("SEC") on October 1, 1996, relating to shares of the Company's
Shares of beneficial interest, $0.001 par value per share, and all
amendments thereto; and
(i) Each Fund's most recent prospectus and Statement
of Additional Information and all amendments and supplements
thereto (collectively, the "Prospectuses").
The Company will furnish FDISG from time to time with
copies, properly certified or authenticated, of all amendments of
or supplements to the foregoing. Furthermore, the Company will
provide FDISG with any other documents that FDISG may reasonably
request and will notify FDISG as soon as possible of any matter
materially affecting the performance of FDISG of its services
under this Agreement.
3. Duties as Administrator. Subject to the supervision
and direction of the Board of Trustees of the Company, FDISG, as
Administrator, will assist in supervising various aspects of the
Company's administrative operations and undertakes to perform the
following specific services:
(a) Maintaining office facilities (which may be in
the offices of FDISG or a corporate affiliate) and furnishing
corporate officers for the Company;
(b) Performing the functions ordinarily performed by
a mutual fund group's internal legal department as described in
Schedule 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;
(c) Accounting and bookkeeping services (including
the maintenance of such accounts, books and records of the Company
as may be required by Section 31(a) of the 1940 Act and the rules
thereunder);
(d) Internal auditing;
(e) Performing all functions ordinarily performed by
the office of a corporate treasurer, and furnishing the services
and facilities ordinarily incident thereto, including calculating
the net asset value of the shares in conformity with the fund(s)
prospectus;
(f) Preparing reports to the Company's shareholders
of record and the SEC including, but not necessarily limited to,
Annual Reports and Semi-Annual Reports on Form N-SAR;
(g) Preparing and filing various reports or other
documents required by federal, state and other applicable laws and
regulations, other than those filed or required to be filed by the
Adviser or Transfer Agent;
(h) Preparing and filing the Company's tax returns;
(i) Assisting the Adviser, at the Adviser's request,
in monitoring and developing compliance procedures for the Company
which will include, among other matters, procedures to assist the
Adviser in monitoring compliance with each Fund's investment
objective, policies, restrictions, tax matters and applicable laws
and regulations;
(j) Monitoring each Fund's compliance with certain
investment objectives, policies, restrictions, tax matters and
applicable rules and regulations as described in the Compliance
Matrix provided by FDISG to the Company;
(k) Performing all functions ordinarily performed by
the office of a corporate secretary, and furnishing the services
and facilities incident thereto, including all functions
pertaining to matters organic to the organization, existence and
maintenance of the corporate franchise of the Company, including
preparation for, conduct of, and recording trustees' meetings and
shareholder meetings;
(l) Performing "Blue Sky" compliance functions,
including maintaining notice filings, registrations or "Blue Chip"
exemptions (if available) in all U.S. jurisdictions requested by
the Company, monitoring sales of shares in all such jurisdictions
and filing such additional notice or applying for such additional
or amended registrations as may be reasonably anticipated to be
necessary to permit continuous sales of the shares of the Funds in
all such jurisdictions, filing sales literature and advertising
materials to the extent required, with such Blue Sky authorities,
and making and filing all other applications, reports, notices,
documents and exhibits in connection with the foregoing;
(m) Furnishing all other services identified on
Schedule B annexed hereto and incorporated herein which are not
otherwise specifically set forth above; and
(n) FDISG agrees to provide the services set forth
herein in accordance with performance standards annexed hereto as
Exhibit 1 of Schedule B and incorporated herein (the "Performance
Standards"). Such Performance Standards may be amended from time
to time upon written agreement by the parties.
In performing its duties under this Agreement, FDISG: (a)
will act in accordance with the Declaration of Trust, By-Laws,
Prospectuses and with the instructions and directions of the
Company and will conform to and comply with the requirements of
the 1940 Act and all other applicable federal or state laws and
regulations; and (b) will consult with legal counsel to the
Company, as necessary and appropriate. Furthermore, FDISG shall
not have or be required to have any authority to supervise the
investment or reinvestment of the securities or other properties
which comprise the assets of the Company or any of its Funds and
shall not provide any investment advisory services to the Company
or any of its Funds.
4. Compensation and Allocation of Expenses. FDISG shall
bear all expenses in connection with the performance of its
services under this Agreement, except as indicated below.
(a) FDISG will from time to time employ or associate
with itself such person or persons as FDISG may believe to be
particularly suited to assist it in performing services under this
Agreement. Such person or persons may be officers and employees
who are employed by both FDISG and the Company. The compensation
of such person or persons shall be paid by FDISG and no obligation
shall be incurred on behalf of the Company in such respect.
(b) FDISG shall not be required to pay any of the
following expenses incurred by the Company: membership dues in
the Investment Company Institute or any similar organization;
investment advisory expenses; costs of printing and mailing stock
certificates, prospectuses, reports and notices; interest on
borrowed money; brokerage commissions; stock exchange listing
fees; taxes and fees payable to Federal, state and other
governmental agencies; fees of Trustees of the Company who are not
affiliated with FDISG; outside auditing expenses; outside legal
expenses; or other expenses not specified in this Section 4 which
may be properly payable by the Company.
(c) The Company on behalf of each of the Funds will
compensate FDISG for the performance of its obligations hereunder
in accordance with the fees set forth in the written Fee Schedule
annexed hereto as Schedule C and incorporated herein. Schedule C
may be amended to add fee schedules for any additional Funds for
which FDISG has been retained as Administrator.
(d) The Company will compensate FDISG for its
services rendered pursuant to this Agreement in accordance with
the fees set forth above. Such fees do not include out-of-pocket
disbursements of FDISG for which FDISG shall be entitled to xxxx
separately. Out-of-pocket disbursements shall include the items
specified in Schedule D annexed hereto and incorporated herein.
5. Limitation of Liability.
(a) FDISG shall not be liable for any error of judgment or
mistake of law or for any loss suffered by the Company in
connection with the performance of its obligations and duties
under this Agreement, except a loss resulting from FDISG's willful
misfeasance, bad faith or negligence in the performance of such
obligations and duties, or by reason of its reckless disregard
thereof.
(b) Each party shall have the duty to mitigate damages for
which the other party may become responsible.
(c) NOTWITHSTANDING ANYTHING IN THIS AGREEMENT TO THE
CONTRARY, IN NO EVENT SHALL EITHER PARTY TO THIS AGREEMENT, ITS
AFFILIATES OR ANY OF ITS OR THEIR DIRECTORS, OFFICERS, EMPLOYEES,
AGENTS OR SUBCONTRACTORS BE LIABLE FOR CONSEQUENTIAL DAMAGES.
6. Indemnification.
(a) The Company shall indemnify and hold FDISG
harmless from and against any and all claims, costs, expenses
(including reasonable attorneys' fees), losses, damages, charges,
payments and liabilities of any sort or kind which may be asserted
against FDISG or for which FDISG may be held to be liable in
connection with this Agreement or FDISG's performance hereunder (a
"Claim"), unless such Claim resulted from a negligent act or
omission to act or bad faith by FDISG in the performance of its
duties hereunder.
(b) FDISG shall indemnify and hold the Company
harmless from and against any and all claims, costs, expenses
(including reasonable attorneys' fees), losses, damages, charges,
payments and liabilities of any sort or kind which may be asserted
against the Company or for which the Company may be held to be
liable in connection with this Agreement (a "Claim"), provided
that such Claim resulted from a negligent act or omission to act,
bad faith, willful misfeasance or reckless disregard by FDISG in
the performance of its duties hereunder.
(c) In any case in which one party hereto (the
"Indemnifying Party") may be asked to indemnify or hold the other
party (the "Indemnified Party") harmless, the Indemnified Party
will notify the Indemnifying Party promptly after identifying any
situation which it believes presents or appears likely to present
a claim for indemnification against the Indemnifying Party
although the failure to do so shall not prevent recovery by the
Indemnified Party and shall keep the Indemnifying Party advised
with respect to all developments concerning such situation. The
Indemnifying Party shall have the option to defend Indemnified
Party against any Claim which may be the subject of this
indemnification, and, in the event that the Indemnifying Party so
elects, such defense shall be conducted by counsel chosen by the
Company and satisfactory to Indemnified Party, and thereupon the
Indemnifying Party shall take over complete defense of the Claim
and the Indemnified Party shall sustain no further legal or other
expenses in respect of such Claim. The Indemnified Party will not
confess any Claim or make any compromise in any case in which the
Indemnifying Party will be asked to provide indemnification,
except with the Indemnifying Party's prior written consent. The
obligations of the parties hereto under this Section 6 shall
survive the termination of this Agreement.
7. Termination of Agreement.
(a) This Agreement shall be effective on the date
first written above and shall continue for a period of three (3)
years (the "Initial Term"), unless earlier terminated pursuant to
the terms of this Agreement. Thereafter, this Agreement may be
terminated at any time without penalty on sixty (60) days prior
written notice.
(b) This Agreement may be terminated by the Company
prior to the expiration of the Initial Term in the event FDISG has
failed to meet the Performance Standards, as set forth in Exhibit
1 to Schedule D, in three consecutive quarters. The Company will
provide FDISG with sixty (60) days written notice after the third
consecutive quarter of FDISG's failure to meet the Performance
Standards if the Company intends to exercise this option under
this Section 7(b). Notwithstanding the foregoing, the Company's
right under this Section 7(b) shall not be effective until ninety
(90) days after FDISG has begun providing services under this
Agreement. In the event that the Transfer Agency and Services
Agreement dated September 20, 1997 (the "Transfer Ageny
Agreement"), between FDISG and the Company is terminated by the
Company because of a breach by FDISG of certain performance
standards as provided in Section 13.3 of the Transfer Agency
Agreement, this Agreement may be terminated by the Company upon
sixty (60) prior written notice to FDISG.
(c) In the event a termination notice is given by
the Company, all reasonable expenses associated with movement of
records and materials and conversion thereof ("Conversion Costs")
will be borne by the Company; provided, however, that in the event
that such termination notice is given as a result of a breach of
the Performance Standards by FDISG with respect to the services to
be provided under this Agreement as outlined in Section 7(b) of
this Agreement or Section 13.3 of the Transfer Agency Agreement or
a material breach by FDISG of its duties and obligations hereunder
as outlined in Section 7(d) of this Agreement or Section 13.5 of
the Transfer Agency Agreement, the Conversion Costs shall not
exceed $15,000.
(d) If a party hereto is guilty of a material
failure to perform its duties and obligations hereunder (a
"Defaulting Party") resulting in a material loss to the other
party, such other party (the "Non-Defaulting Party") may give
written notice thereof to the Defaulting Party, and if such
material breach shall not have been remedied within thirty (30)
days after such written notice is given, then the Non-Defaulting
Party may terminate this Agreement by giving thirty (30) days
written notice of such termination to the Defaulting Party. If
FDISG is the Non-Defaulting Party, its termination of this
Agreement shall not constitute a waiver of any other rights or
remedies of FDISG with respect to services performed prior to such
termination or rights of FDISG to be reimbursed for out-of-pocket
expenses. In all cases, termination by the Non-Defaulting Party
shall not constitute a waiver by the Non-Defaulting Party of any
other rights it might have under this Agreement or otherwise
against the Defaulting Party.
8. Modifications and Waivers. No change, termination,
modification, or waiver of any term or condition of the Agreement
shall be valid unless in writing signed by each party. A party's
waiver of a breach of any term or condition in the Agreement shall
not be deemed a waiver of any subsequent breach of the same or
another term or condition.
9. No Presumption Against Drafter. FDISG and the Company
have jointly participated in the negotiation and drafting of this
Agreement. The Agreement shall be construed as if drafted jointly
by the Company and FDISG, and no presumptions arise favoring any
party by virtue of the authorship of any provision of this
Agreement.
10. Publicity. Neither FDISG nor the Company shall
release or publish news releases, public announcements,
advertising or other publicity relating to this Agreement or to
the transactions contemplated by it without prior review and
written approval of the other party; provided, however, that
either party may make such disclosures as are required by legal,
accounting or regulatory requirements after making reasonable
efforts in the circumstances to consult in advance with the other
party.
11. Severability. The parties intend every provision of
this Agreement to be severable. If a court of competent
jurisdiction determines that any term or provision is illegal or
invalid for any reason, the illegality or invalidity shall not
affect the validity of the remainder of this Agreement. In such
case, the parties shall in good faith modify or substitute such
provision consistent with the original intent of the parties.
Without limiting the generality of this paragraph, if a court
determines that any remedy stated in this Agreement has failed of
its essential purpose, then all other provisions of this
Agreement, including the limitations on liability and exclusion of
damages, shall remain fully effective.
13. Miscellaneous.
(a) Any notice or other instrument authorized or
required by this Agreement to be given in writing to the Company
or FDISG shall be sufficiently given if addressed to the party and
received by it at its office set forth below or at such other
place as it may from time to time designate in writing.
To the Company:
First Choice Funds Trust
0000 Xxxxxxxx Xxxxx
Xxxxxxxxxxx, Xxxxxxxxxxxxx 00000
Attention: President
with a copy to:
Xxxxx & XxXxxxxx
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxx
To FDISG:
First Data Investor Services Group, Inc.
0000 Xxxxxxxx Xxxxx
Xxxxxxxxxxx, Xxxxxxxxxxxxx 00000
Attention: President
with a copy to FDISG's General Counsel
(b) This Agreement shall be binding upon and inure
to the benefit of the parties hereto and their respective
successors and permitted assigns and is not intended to confer
upon any other person any rights or remedies hereunder. This
Agreement may not be assigned or otherwise transferred by either
party hereto, without the prior written consent of the other
party, which consent shall not be unreasonably withheld. With the
prior written consent of the Company, FDISG may engage
subcontractors to perform any of the obligations contained in this
Agreement to be performed by FDISG.
(c) The laws of the Commonwealth of Massachusetts,
excluding the laws on conflicts of laws, shall govern the
interpretation, validity, and enforcement of this Agreement. All
actions arising from or related to this Agreement shall be brought
in the state and federal courts sitting in the City of Boston, and
FDISG and the Company hereby submit themselves to the exclusive
jurisdiction of those courts.
(d) 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.
(e) The captions of 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.
(f) The Company and FDISG agree that the obligations
of the Company under the Agreement shall not be binding upon any
of the Trustees, shareholders, nominees, officers, employees or
agents, whether past, present or future, of the Company
individually, but are binding only upon the assets and property of
the Company, as provided in the Declaration of Trust. The
execution and delivery of this Agreement have been authorized by
the Trustees of the Company, and signed by an authorized officer
of the Company, acting as such, and neither such authorization by
such Trustees nor such execution and delivery by such officer
shall be deemed to have been made by any of them or any
shareholder of the Company individually or to impose any liability
on any of them or any shareholder of the Company personally, but
shall bind only the assets and property of the Company as provided
in the Declaration of Trust.
13. Confidentiality.
(a) The parties agree that the Proprietary
Information (defined below) and the contents of this Agreement
(collectively "Confidential Information") are confidential
information of the parties and their respective licensers. The
Company and FDISG shall exercise reasonable care to safeguard the
confidentiality of the Confidential Information of the other. The
Company and FDISG may each use the Confidential Information only
to exercise its rights or perform its duties under this Agreement.
The Company and FDISG shall not duplicate, sell or disclose to
others the Confidential Information of the other, in whole or in
part, without the prior written permission of the other party. The
Company and FDISG may, however, disclose Confidential Information
to its employees who have a need to know the Confidential
Information to perform work for the other, provided that each
shall use reasonable efforts to ensure that the Confidential
Information is not duplicated or disclosed by its employees in
breach of this Agreement. The Company and FDISG may also disclose
the Confidential Information to independent contractors, auditors
and professional advisors and as legally required or requested by
regulators. Notwithstanding the previous sentence, in no event
shall either the Company or FDISG disclose the Confidential
Information to any competitor of the other without specific, prior
written consent.
(b) Proprietary Information means:
(i) any data or information that is completely
sensitive material, and not generally known to the public,
including, but not limited to, information about product plans,
marketing strategies, finance, operations, customer relationships,
customer profiles, sales estimates, business plans, and internal
performance results relating to the past, present or future
business activities of the Company or FDISG, their respective
subsidiaries and affiliated companies and the customers, clients
and suppliers of any of them;
(ii) any scientific or technical information,
design, process, procedure, formula, or improvement that is
commercially valuable and secret in the sense that its
confidentiality affords the Company or FDISG a competitive
advantage over its competitors; and
(iii) all confidential or proprietary concepts,
documentation, reports, data, specifications, computer software,
source code, object code, flow charts, databases, inventions,
know-how, show-how and trade secrets, whether or not patentable or
copyrightable.
(c) Confidential Information includes, without
limitation, all documents, inventions, substances, engineering and
laboratory notebooks, drawings, diagrams, specifications, bills of
material, equipment, prototypes and models, and any other tangible
manifestation of the foregoing of either party which now exist or
come into the control or possession of the other.
(d) Each party acknowledges that breach of the
restrictions on use, dissemination or disclosure of any
Confidential Information of the other party would result in
immediate and irreparable harm, and money damages would be
inadequate to compensate the other party for that harm. Each party
shall be entitled to equitable relief, in addition to all other
available remedies, to redress any such breach.
14. Force Majeure. No party shall be liable for any
default or delay in the performance of its obligations under this
Agreement if and to the extent such default or delay is caused,
directly or indirectly, by (i) fire, flood, elements of nature or
other acts of God; (ii) any outbreak or escalation of hostilities,
war, riots or civil disorders in any country, (iii) any act or
omission of the other party or any governmental authority; (iv)
any labor disputes (whether or not the employees' demands are
reasonable or within the party's power to satisfy); or (v)
nonperformance by a third party or any similar cause beyond the
reasonable control of such party, including without limitation,
failures or fluctuations in telecommunications or other equipment.
In any such event, the non-performing party shall be excused from
any further performance and observance of the obligations so
affected only for so long as such circumstances prevail and such
party continues to use commercially reasonable efforts to
recommence performance or observance as soon as practicable.
15. Entire Agreement. This Agreement, including all
Schedules hereto, constitutes the entire Agreement between the
parties with respect to the subject matter hereof and supersedes
all prior and contemporaneous proposals, agreements, contracts,
representations, and understandings, whether written or oral,
between the parties with respect to the subject matter hereof.
IN WITNESS WHEREOF, the parties hereto have caused this
instrument to be duly executed and delivered by their duly
authorized officers as of the date first written above.
FIRST DATA INVESTOR SERVICES GROUP, INC.
By:XXXX XXXXXXX
Name:Xxxx Xxxxxxx
Title:Vice President and General Manager
FIRST CHOICE FUNDS TRUST
By:XXXX X. XXXXXXX
Name: Xxxx X. Xxxxxxx
Title:Trustee
SCHEDULE A
U.S. Treasury Reserve Fund
Cash Reserve Fund
SCHEDULE B
Fund Accounting and Administrative Services
Routine Projects
Daily, Weekly, and Monthly Reporting
Portfolio and General Ledger Accounting
Daily Pricing of all Securities
Daily Valuation and NAV Calculation
Comparison of NAV to market movement
Review of price tolerance/fluctuation report
Research items appearing on the price exception report
Weekly cost monitoring along with market-to-market
valuations in accordance with Rule 2a7
Preparation of monthly ex-dividend monitor
Daily cash reconciliation with the custodian bank
Daily updating of price and rate information to the Transfer
Agent/Insurance Agent
Daily support and report delivery to Portfolio Management
Daily calculation of fund advisor fees and waivers
Daily calculation of distribution rates
Daily maintenance of each fund's general ledger including
expense accruals
Daily price notification to other vendors as required
Calculation of 30-day adjusted SEC yields
Preparation of month-end reconciliation package
Monthly reconciliation of Fund expense records
Preparation of monthly pay down gain/loss summaries
Preparation of all annual and semi-annual audit work papers
Preparation and Printing of Financial Statements
Providing Shareholder Tax Information to Transfer Agent
Producing Drafts of IRS and State Tax Returns
Treasury Services including:
Provide Officer for the Fund
Expense Accrual Monitoring
Determination of Dividends
Prepare materials for review by the Board, e.g., 2a-
7,10f-3, 17a-7, 17e-1, Rule 144a
Tax and Financial Counsel
Monthly Compliance Testing including Section 817H
SCHEDULE B (continued)
Legal, Regulatory and Board of Trustees Support
Routine Legal Services
Corporate Secretarial
* Assist in maintaining corporate records and good standing
status of Fund in its state of organization
* Provide Secretary/Assistant Secretary for Fund
* Develop and maintain calendar of annual and quarterly board
approvals and regulatory filings
* Prepare notice, agenda, memoranda, resolutions and
background materials for legal approval at quarterly and special
board meetings; attend meetings; make presentations where
appropriate; prepare minutes; follow up on issues
Regulatory/Filings
* Prepare and file annual Post-Effective Amendment
* Assist in preparation of Fund Registration Statement
* Prepare and file Rule 24f-2 and Rule 24e-2 Notices
* Prepare and file proxy materials (including merger
documents) (one in a two year period)
* Review and file Form N-SAR
* Review and file Annual and Semi-Annual Financial Reports
* Prepare prospectus supplements as needed
Miscellaneous Routine Legal Services
* Communicate significant regulatory or legislative
developments to Fund management and directors and provide related
planning assistance where needed
* Consult with Fund management regarding portfolio compliance
and Fund corporate and regulatory issues as needed
* Maintain effective communication with outside counsel and
review legal bills of outside counsel
* Coordinate the printing and mailing process with outside
printers for all shareholder publications
* Assist in managing SEC audits of Funds
* Review sales material and advertising for Fund SEC and NASD
compliance
* Assist in conversion
Coordinate time and responsibility schedules
Draft notice, agenda, memoranda, resolutions and
background materials for board
approval
* Assist in new fund start-up (to the extent requested)
Coordinate time and responsibility schedules
Prepare Fund corporate documents (MTA/by-laws)
Draft/file registration statement (including investment
objectives/policies and
prospectuses)
Respond to and negotiate SEC comments
Draft notice, agenda and resolutions for organizational
meeting; attend board meeting;
make presentations where appropriate; prepare
minutes and follow up on issues
* Arrange D&O/E&O insurance and fidelity bond coverage for
Fund
* Assist in monitoring Fund Code of Ethics reporting and
provide such reports to Adviser
* Assist in developing compliance guidelines and procedures to
improve overall compliance by Fund and service providers
* Prepare notice, agenda, memoranda and background materials
for special board meetings, make presentations where appropriate,
prepare minutes and follow up on issues
* Prepare PEA for special purposes (e.g., new funds or
classes, changes in advisory relationships, mergers,
restructurings)
* Prepare special prospectus supplements where needed
* Assist in preparation of exemptive order applications (one
per year)
Exhibit 1 to Schedule B
Performance Standards
Pursuant to Section 3(n) of this Agreement, FDISG has agreed
to perform the services described in this Agreement in accordance
with the Performance Standards set forth in this Exhibit 1 to
Schedule B. The parties agree that the measurement of the
Performance Standards will not begin until ninety (90) days after
FDISG has begun providing services under this Agreement. The
parties agree that each quarterly period, as described below, will
be measured on a rolling three calendar month period. The parties
agree that such Performance Standards, which are described below,
may be revised from time to time upon the mutual agreement of the
parties. The parties agree that any new Funds that may be added
to the Company from time to time will be entitled to similar
Performance Standards and measuring periods.
(a) In the event that FDISG fails to meet a particular
Performance Standard (except any failure due to circumstances
beyond its control) in any particular quarter, the Company will
provide FDISG with written notice of such failure, and FDISG
agrees to take appropriate corrective action as soon as reasonably
possible.
(b) In the event that FDISG fails to meet a particular
Performance Standard (except for any failure due to circumstances
beyond its control) in two (2) consecutive quarters, the fee
payable to FDISG hereunder for such service shall be reduced by
ten percent (10%) for the second of those two quarters.
(c) In the event that FDISG fails to meet a particular
Performance Standard (except for any failure due to circumstances
beyond its control) for any three (3) consecutive quarters, the
Company shall have the right to terminate this Agreement upon
sixty (60) days' written notice to FDISG.
(d) Compliance with the Performance Standards shall be
measured quarterly based on the average performance during that
quarter. In the event that the number of Funds shall increase to
five (5), compliance with the Performance Standards shall then be
measured monthly based on the average performance during that
month, except with respect to those services which are provided
only on a quarterly basis. A month shall be defined as a calendar
month.
(e) The Performance Standards shall be as follows:
Fund Accounting
1) Accounting and reported numbers are accurate at least 98% of
the time.
2) Mispricings of assets occurs less than 2% of the time unless
incorrect information is received from the pricing services or the
custodian.
3) A call for accurate final First Choice US Treasury Reserve
investable cash total will be delivered no later than 12:15 EST
(9:15 PST) if trades are received by fund close of 12 noon EST
(9:00 am PST). Followed by a faxed investable cash total sent no
later than 12:40 EST (9:40 PST).
4) A call for accurate final First Choice Cash Reserve
investable cash total delivered no later than 3:15 EST (12:15 PST)
if trades are received by fund close of 3:00 EST (12 noon PST).
Followed by a faxed investable cash total sent no later than 3:40
EST (12:40 PST).
5) Call for initial preliminary FC Cash Reserve investable cash
total will be delivered by 1:00 EST (10:00 PST)
6) Daily individual issuer classification and individual issue
outstanding percentages and totals monitored with 98% accuracy.
7) Daily industry classification of issuer and overall industry
outstanding percentages and totals monitored with 98% accuracy.
8) Daily pricings, yields, asset reports, and other daily
reports sent by fax one hour after fund close or final portfolio
trade, whichever is later.
9) Weekly xxxx-to-market NAV pricing one hour after fund
receives transmission from pricing vendor on Tuesdays.
10) Standardize month end reports factor by close of business
5:00 PM EST (2:00 PM PST) the first business day of the month.
Reports to be provided will be mutually determined at a future
date.
11) Daily rate factor sheet one hour after fund close or final
portfolio trade, whichever is later to First American Trust
Company or any client larger than 5% of the fund's total market
value.
12) Monthly advisory management rate factor by close of business
5:00 PM EST (2:00 PM EST) the first business day of the month.
Standards involving quarterly or semi-annual actions
13) Draft minutes of meeting to directors within 30 days after
meeting.
14) Keep advisor and Board apprised of latest compliance
regulations.
15) Board notification four (4) weeks in advance of meeting.
16) Board material to Board ten (10) business days before
meeting.
17) Request for materials needed from Advisor three (3) weeks in
advance of Board meeting.
18) All information on semi-annual and annual reports will
reflect accurate descriptions, as well as accurate coupons or
purchase discount rates.
SCHEDULE C
FEE SCHEDULE
For the services to be rendered, the facilities to be
furnished and the payments to be made by FDISG, as provided for in
this Agreement, the Company, on behalf of each Fund, will pay
FDISG on the first business day of each month a fee for the
previous month at the rates listed below. The fee for the period
from the effective date of this Agreement to the end of such month
shall be prorated according to the proportion that such period
bears to the full monthly period. Upon any termination of this
Agreement before the end of any month, the fee for such part of a
month shall be prorated according to the proportion which such
period bears to the full monthly period and shall be payable upon
the date of termination of this Agreement.
Fund Accounting Services:
$30,000 per Fund per annum, plus
$5,000 per class per annum
Fund Administration Services:
FDISG shall be paid an annual administration fee at
the annual rate as follows:
0.15% of the Funds' combined average daily net
assets.
FDISG shall be entitled to collect all out-of-pocket fees
described in Schedule D.
SCHEDULE D
OUT-OF-POCKET EXPENSES
Out-of-pocket expenses include the following:
- Postage of Board meeting materials and other materials to
the Company's
Board members and service providers (including overnight or
other courier
services)
- Telecommunications charges (including FAX) with respect to
communications with the Company's directors, officers and
service
providers
- Duplicating charges with respect to filings with federal and
state authorities
and Board meeting materials
- Courier services
- Pricing services
- Forms and supplies for the preparation of Board meetings and
other
materials for the Company
- Vendor set-up charges for Blue Sky services
- Customized programming requests
- Such other expenses as are agreed to by FDISG and the
Company
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