Exhibit 99.B.9.b
ADMINISTRATION AGREEMENT
This Agreement, dated as of the ___day of ______, 1994, made by and
between McM Funds, a Delaware Business Trust (the "Trust") operating as a
registered investment company under the Investment Company Act of 1940, as
amended (the "Act"), duly organized and existing under the laws of the State of
Delaware and Fund/Plan Services, Inc. ("Fund/Plan"), a corporation duly
organized and existing under the laws of the State of Delaware (collectively,
the "Parties").
WITNESSETH THAT:
WHEREAS, the Trust is authorized by its Trust Instrument to issue
separate series of shares representing interests in separate investment
portfolios (the "Series"), which Series are identified on Schedule "C" attached
hereto, and which Schedule "C" may be amended from time to time by mutual
agreement of the Trust and Fund/Plan; and
WHEREAS, the Parties desire to enter into an agreement whereby
Fund/Plan will provide certain administration services to each of the Series on
the terms and conditions set forth in this Agreement; and
WHEREAS, Fund/Plan is willing to serve in such capacity and perform
such administrative services under the terms and conditions set forth below; and
WHEREAS, the Trust on behalf of each of the Series, will provide
certain information concerning the Series to Fund/Plan as set forth below;
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein, the Parties hereto, intending to be legally bound, do hereby
agree as follows:
Section 1. Appointment The Trust hereby appoints, and Fund/Plan hereby
accepts such appointment, as administrator to each Series of the Trust. The
Trust further agrees to appoint Fund/Plan as administrator to any additional
series which, from time to time may be added to the Trust.
Section 2. Duties and Obligations of Fund/Plan
(a) Subject to the succeeding provisions of this section and
subject to the direction and control of the Board of Trustees of the Trust,
Fund/Plan shall provide to each of the Series all administrative services as set
forth in Schedule "A" attached hereto and incorporated by reference into this
Agreement. In addition to the obligations set forth in Schedule "A", Fund/Plan
shall (i) provide its own office space, facilities and equipment and personnel
for the performance of its duties under this Agreement; and (ii) take all
actions it deems necessary to properly execute administration on behalf of the
Series.
(b) So that Fund/Plan may perform its duties under the terms of this
Agreement, the Board of Trustees of the Trust shall direct the officers,
investment advisor, distributor, legal counsel, independent accountants and
custodian of the Trust to cooperate fully with Fund/Plan and to provide such
information, documents and advice relating to the Series as is within the
possession or knowledge of such persons. In connection with its duties,
Fund/Plan shall be entitled to rely, and shall be held harmless by the Trust
when acting in reasonable reliance upon the instruction, advice or any documents
relating to the Series as provided by the Trust to Fund/Plan by any of the
aforementioned persons. All fees charged by any such persons shall be deemed an
expense of the Trust.
(c) Any activities performed by Fund/Plan under this Agreement shall
conform to the requirements of:
(1) the provisions of the Securities Act of 1933, as amended,
and of any rules or regulations in force thereunder;
(2) any other applicable provision of state and federal law;
(3) the provisions of the Declaration of Trust and By-Laws of
the Trust as amended from time to time;
(4) any policies and determinations of the Board of Trustees
of the Trust; and
(5) the fundamental policies of the Series as reflected in the
Trust's registration statement under the Act.
Fund/Plan agrees that all records that it maintains for the Trust are
the property of the Trust and will be surrendered promptly to the Trust upon
written request. Fund/Plan will preserve, for the periods prescribed under Rule
31a-2 under the Act, all such records required to be maintained under Rule 31a-1
of the Act.
(d) Nothing in this Agreement shall prevent Fund/Plan or any officer
thereof from acting as administrator for or with any other person, firm or
corporation. While the administrative services supplied to the Trust may be
different than those supplied to other persons, firms or corporations, Fund/Plan
shall provide the Trust equitable treatment in supplying services. The Trust
recognizes that it will not receive preferential treatment from Fund/Plan as
compared with the treatment provided to other Fund/Plan clients. Fund/Plan
agrees to maintain the records and all other information of the Trust in a
confidential manner and shall not use such information for any purpose other
than the performance of Fund/Plan's duties under this Agreement.
Section 3. Allocation of Expenses All costs and expenses of the Trust
shall be paid by the Trust including, but not limited to:
(a) fees paid to the investment adviser;
(b) interest and taxes;
(c) brokerage fees and commissions;
(d) insurance premiums;
(e) compensation and expenses of its Trustees who are not
affiliated persons of the Adviser;
(f) legal, accounting and audit expenses;
(g) custodian and transfer agent, or shareholder
servicing agent, fees and expenses;
(h) fees and expenses incident to the registration of the
shares of the Trust under Federal or state securities
laws;
(i) expenses related to preparing, setting in type,
printing and mailing prospectuses, statements of
additional information, reports and notices and proxy
material to shareholders of the Trust;
(j) all expenses incidental to holding meetings of
shareholders and Trustees of the Trust;
(k) such extraordinary expenses as may arise, including
litigation, affecting the Trust and the legal
obligations which the Trust may have regarding
indemnification of its officers and trustees; and
(l) fees and out-of-pocket expenses paid on behalf of the
Trust by Fund/Plan.
Section 4. Compensation of Fund/Plan The Trust agrees to pay Fund/Plan
compensation for its services and to reimburse it for expenses, at the rates and
amounts as set forth in Schedule "B" attached hereto, and as shall be set forth
in any amendments to such Schedule "B" approved by the Trust and Fund/Plan. The
Trust agrees and understands that Fund/Plan's compensation will be comprised of
two components and payable on a monthly basis as follows:
(i) A fixed fee for each Series, together with a combined asset-based
fee that the Trust hereby authorizes Fund/Plan to collect by debiting the
Trusts' custody account for invoices which are rendered for the services
performed. The invoices for the services performed will be sent to the Trust
after such debiting with the
indication that payment has been made; and
(ii) reimbursement of any out-of-pocket expenses paid by Fund/Plan on
behalf of the Trust, which out-of-pocket expenses will be billed to the Trust
within the first ten calendar days of the month following the month in which
such out-of-pocket expenses were incurred. The Trust agrees to reimburse
Fund/Plan for such expenses within ten calendar days of receipt of such xxxx.
For the purpose of determining fees payable to Fund/Plan, the value of
Series' net assets shall be computed at the times and in the manner specified in
Series' Prospectuses and Statements of Additional Information then in effect.
During the term of this Agreement, should the Trust seek services or
functions in addition to those outlined above or in Schedule "A" attached, a
written amendment to this Agreement specifying the additional services and
corresponding compensation shall be executed by both Fund/Plan and the Trust.
Section 5. Duration and Termination
(a) Except to the extent there is material negligent non-performance by
Fund/Plan of its duties under this Agreement, the term of this Agreement shall
be for a period of two (2) years, commencing on the effective date of the
Trust's registration statement ("Effective Date") with the U.S. Securities and
Exchange Commission.
(b) The fee schedule set forth in Schedule "B" attached shall be fixed
for (2) years commencing on the Effective Date of this Agreement. Thereafter,
the fee schedule will be subject to review and adjustment.
(c) After the initial term of this Agreement, the Trust or Fund/Plan
may give written notice to the other of the termination of this Agreement, such
termination to take effect at the time specified in the notice, which date shall
not be less than ninety (90) days after the date of giving notice. Upon the
effective termination date, the Trust shall pay to Fund/Plan such compensation
as may be due as of the date of termination and shall likewise reimburse
Fund/Plan for any out-of-pocket expenses and disbursements reasonably incurred
by Fund/Plan to such date.
(d) This Agreement shall extend to and shall be binding upon the
Parties and their respective successors and assigns; provided, however, that
this Agreement shall not be assignable by the Trust without the written consent
of Fund/Plan or by Fund/Plan without the written consent of the Trust,
authorized or approved by a resolution of its respective Board of Directors or
Board of Trustees.
Section 6. Amendment No provision of this Agreement may be amended or
modified, in any manner except by a written agreement properly authorized and
executed by Fund/Plan and the Trust.
Section 7. Applicable Law This Agreement shall be governed by the laws
of the Commonwealth of Pennsylvania and that the venue of any action arising
under this Agreement shall be Xxxxxxxxxx County, Commonwealth of Pennsylvania if
the suit is instituted by the Trust. If a suit is instituted by Fund/Plan the
venue of such action arising under this Agreement shall be San Francisco,
California.
Section 8. Limitation of Liability
(a) The execution and delivery of this contract has been duly
authorized by the Board of Trustees of the Trust and executed on behalf of the
Trust by the undersigned officer, in that officer's capacity as an officer of
the Trust. The obligations under this Agreement shall be binding upon the assets
and property of the Trust and shall not be binding upon any officer or
shareholder of the Series individually.
(b) Fund/Plan, its directors, officers, employees, shareholders and
agents shall only be liable for any error of judgment or mistake of law or for
any loss suffered by the Trust in connection with the performance of this
Agreement that result from willful misfeasance, bad faith or negligence or
reckless disregard on the part of Fund/Plan in the performance of its
obligations and duties under this Agreement.
(c) Any person, even though also a director, officer, employee,
shareholder or agent of Fund/Plan, who may be or become an officer, trustee,
employee or agent of the Trust, shall be deemed when rendering services to such
entity or acting on any business of such entity (other than services or business
in connection with Fund/Plan's duties under the Agreement), to be rendering such
services to or acting solely for the Trust and not as a director, officer,
employee, shareholder or agent of, or one under the control or direction of
Fund/Plan even though such person may receive compensation from Fund/Plan.
(d) Notwithstanding any other provision of this Agreement, the Trust
shall indemnify and hold harmless Fund/Plan, its directors, officers, employees,
shareholders and agents from and against any and all claims, demands, expenses
and liabilities (whether with or without basis in fact or law) of any and every
nature which Fund/Plan may sustain or incur or which may be asserted against
Fund/Plan by any person by reason of, or as a result of (i) any action taken or
omitted to be taken by Fund/Plan in good faith, (ii) any action taken or omitted
to be taken by Fund/Plan in good faith in reliance upon any certificate,
instrument, order or stock certificate or other document reasonably believed by
Fund/Plan to be genuine and to be signed, countersigned or executed by any duly
authorized person, upon the oral instructions or written instruction of an
authorized person of the Trust or upon the opinion of legal counsel for the
Trust; or (iii) any action taken or omitted to be taken by Fund/Plan in
connection with its appointment in good faith in reliance upon any law, act,
regulation or interpretation of the same even though the same may thereafter
have been altered, changed, amended or repealed. Indemnification under this
subparagraph shall not apply, however, to actions or omissions of Fund/Plan or
its directors, officers, employees, shareholders or agents in cases of its or
their own negligence, misconduct, bad faith, or reckless disregard of its or
their own duties hereunder.
(e) Fund/Plan shall give written notice to the Trust within ten (10)
business days of receipt by Fund/Plan of a written assertion or claim of any
threatened or pending legal proceeding which may be subject to this
indemnification. The failure to notify the Trust of such written assertion or
claim shall not, however, operate in any manner whatsoever to relieve the Trust
of any liability arising under this Section or otherwise, unless such failure
prejudices the Trust.
(f) For any legal proceeding giving rise to this indemnification, the
Trust shall be entitled to defend or prosecute any claim in the name of
Fund/Plan at its own expense and through counsel of its own choosing if it gives
written notice to Fund/Plan within thirty (30) business days of receiving notice
of such claim. Notwithstanding the foregoing, Fund/Plan may participate in the
litigation at its own expense through counsel of its own choosing. If the Trust
does choose to defend or prosecute such claim, then the parties shall cooperate
in the defense or prosecution thereof and shall furnish such records and other
information as are reasonably necessary.
(g) The terms of this Section 8 shall survive the termination of this
Agreement.
Section 9. Notices Except as otherwise provided in this Agreement, any
notice or other communication required by or permitted to be given in connection
with this Agreement shall be in writing, and shall be delivered in person or
sent by first class mail, postage prepaid to the respective parties as follows:
If to the Trust: If to Fund/Plan:
---------------- ----------------
McM Funds Fund/Plan Services, Inc.
Xxx Xxxx Xxxxxx, Xxxxx 000 0 Xxxx Xxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000 Xxxxxxxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxx, Attention: Xxxxxxx X. Xxxxx,
Vice President President
Copies to:
----------
Heller, Ehrman, White & XxXxxxxxx
000 Xxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000-0000
Attention: Xxxxx Xxxxxxx, Esq.
Section 10. Severability If any part, term or provision of this
Agreement is held by any court to be illegal, in conflict with any law or
otherwise invalid, the remaining portion or portions shall be considered
severable and not affected, and the rights and obligations of the parties shall
be construed and enforced as if the Agreement did not contain the particular
part, term or provision held to be illegal or invalid provided that the basic
agreement is not thereby substantially impaired.
Section 11. Section Headings Section and Paragraph headings are for
convenience only and shall not be construed as part of this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
consisting of seven type written pages, together with Schedules "A", "B" and
"C", to be signed by their duly authorized officers as of the day and year first
above written.
McM Funds Fund/Plan Services, Inc.
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By: Xxxxx X. Xxxxxx, Vice President By: Xxxxxxx X. Xxxxx, President
SCHEDULE "A"
FUND ADMINISTRATION SERVICES
FOR
McM Funds
I. Regulatory Compliance
A. Compliance - Federal Investment Company Act of 1940
1. Review, report and renew
a. investment advisory contracts
b. fidelity bond
c. underwriting contracts
d. distribution (12b-1) plans
e. administration contracts
f. accounting contracts
g. custody contracts
h. transfer agent and shareholder services
contracts
2. Filings
a. N-SAR (semi-annual report)
b. N-1A (prospectus), post-effective amendments
and supplements ("stickers")
c. proxy statement (when necessary)
d. 24f-2 indefinite registration of shares
e. filing fidelity bond under 17g-1
f. filing shareholder reports under 30b2-1
3. Annual up-dates of biographical information and
questionnaires for Trustees and Officers
B. Compliance - State "Blue Sky"
1. Blue Sky (state registration)
a. registration shares
b. registration issuer/dealer/agent (no loads)
c. monitor sale shares over/under
d. report shares sold
e. filing of federal prospectus and contracts
f. filing annual and semi-annual reports with
states
C. Compliance - Prospectus
1. Analyze and review portfolio reports from investment
adviser re:
a. compliance with investment objectives
b. maximum investment by company/industry size
D. Compliance - Other
1. Proxy when necessary
2. Applicable stock exchange rules
3. Applicable state tax laws
II. Corporate Business and Shareholder/Public Information
A. Trustees/Management
1. Preparation of meetings
a. agendas - all necessary items of compliance
b. arrange meetings
c. prepare minutes of same
d. keep attendance records
e. maintain corporate records/minute book
B. Coordinate Proposals
1. Printers
2. Auditors
3. Literature fulfillment
4. Insurance
5. Underwriters
C. Maintain Corporate Calendars and Files
1. General
2. Blue sky
D. Shareholder Meetings
1. Preparation of proxy
2. Conduct meeting
3. Preparation of minutes and record ballot results
E. Release Corporate Information
1. To shareholders
2. To financial and general press
3. To industry publications
a. distributions (dividends and capital gains)
b. tax information
c. changes to prospectus
d. letters from management
e. funds' performance
4. Respond to:
a. financial press, as authorized
b. miscellaneous shareholders inquiries
c. industry questionnaires
Fund Administration Services
5. Prepare, maintain and update monthly information
manual
F. Communications to Shareholders
1. Coordinate printing and distribution of annual,
semi-annual, quarterly reports, and prospectus
III. Financial and Management Reporting
A. Income and Expenses
1. Preparation of budgets
2. Expense figures calculated and accrual levels set
3. Monitoring of expenses
4. Approve and authorize payment of expenses
5. Projection of Income
B. Distributions to Shareholders
1. Projections of distribution amounts
a. compliance with income tax provisions
b. compliance with excise tax provisions
c. compliance with Investment Company Act of
1940
2. Compilation and reclassification of distributions,
where applicable, for year end tax reporting to
shareholders
C. Financial Reporting
1. Liaison between fund management and auditors
2. Preparation of unaudited and audited reports to
shareholders
3. 60-day delivery to SEC and shareholders
D. Subchapter M Compliance
1. Asset diversification test
2. Short/short test
3. Income qualification test
E. Other Financial Analyses
1. Upon request from fund management, other budgeting
and analyses can be constructed to meet a fund's
specific needs
F. Review and Monitoring Functions
1. Review NAV calculations
2. Coordinate and review transfer agent, accounting and
custody functions
3. Review 12b-1 accruals, expenditures and payment trail
commissions where applicable
G. 1. Preparation and distribution of periodic operational
and statistical reports to management.
SCHEDULE "B"
FEE SCHEDULE
FOR
McM Funds
(The Fee Schedule is fixed for a period of two (2) years from the Effective Date
of the Trust.)
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I. FUND ADMINISTRATION
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(1/12th payable monthly)
.0008 On the First $100 Million of Average Net Assets
.0005 On the Next $500 Million of Average Net Assets
.0003 Over $600 Million of Average Net Assets
The rates stated in the above Administration fee schedule are
annualized and will be applied to the aggregate total net assets of the
Trust. In addition, there is a minimum fee of $50,000 per year for the
initial series of shares issued by the Trust and $10,000 per year for
each additional separate series of shares issued the Trust. The minimum
fees will be applied to each separate series of shares until such time
that all separate series within the Trust exceed the minimum fees.
Maximum annual fee for a family of funds is $500,000.
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II. OUT-OF-POCKET EXPENSES
=============================================
McM Funds will reimburse Fund/Plan Services monthly for all reasonable
out-of-pocket expenses, including postage, telecommunications
(telephone and fax), special reports, record retention, special
transportation costs as incurred. The cost of copying and sending
materials to auditors for off-site audits will be an additional
expense.
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III. ADDITIONAL SERVICES
=============================================
Activities of a non-recurring nature such as fund consolidations,
mergers or reorganizations will be subject to negotiation. To the
extent the Fund should decide to issue multiple/separate classes of
shares, additional fees will apply. Any additional/enhanced services or
reports will be quoted upon request.
SCHEDULE "C"
IDENTIFICATION OF SERIES
Below are listed the "Series" to which services under this Agreement are to be
performed as of the execution date of this Agreement:
"McM Funds"
1. Equity Investment Fund
2. Special Equity Fund
3. Balanced Fund
4. Intermediate Fixed Income Fund
5. Fixed Income Fund
6. Principal Preservation Fund
This Schedule "C" may be amended from time to time by agreement of the Parties.
