AMENDED AND RESTATED
ADMINISTRATION AGREEMENT
The Administration Agreement of Preferred Income Fund Incorporated, a
Maryland corporation (the "Fund") made and agreed to by and between the Fund and
THE BOSTON COMPANY ADVISORS, INC., a Massachusetts corporation ("Boston
Advisors"), on January 24, 1991, as amended and restated on March 1, 1993 and as
assigned by Boston Advisors to FIRST DATA INVESTOR SERVICES GROUP, INC., a
Massachusetts corporation ("FDISG"), (then known as The Shareholder Services
Group, Inc.) on April 29, 1994, is hereby further amended and restated as of
December 1, 1996 to read in its entirety as follows:
WHEREAS, the Fund is registered as a diversified, closed-end management
investment company under the Investment Company Act of 1940, as amended (the
"1940 Act"); and
WHEREAS, the Fund desires to retain FDISG to render certain
administrative services to the Fund and FDISG is willing to render such
services;
WITNESSETH:
NOW, THEREFORE, in consideration of the premises and mutual convenants
herein contained, it is agreed between the parties hereto as follows:
1. APPOINTMENT. The Fund hereby appoints FDISG to act as
Administrator of the Fund 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.
2. DELIVERY OF DOCUMENTS. The Fund has furnished FDISG with copies
properly certified or authenticated of each of the following:
(a) Resolutions of the Fund's Board of Directors authorizing
the appointment of FDISG to provide certain administrative services to the Fund
and approving this Agreement;
(b) The Fund's Articles of Incorporation filed with the
Maryland Department of Assessments and Taxation on September 28, 1990 and all
amendments thereto (the "Articles");
(c) The Fund's By-Laws and all amendments thereto (the
"By-Laws");
(d) The Investment Advisory Agreement between Xxxxxxxx &
Xxxxxxxx Incorporated (the "Adviser") and the Fund dated as of January 24, 1991
as amended and restated from time to time (the "Advisory Agreement");
(e) The Custody Agreement between Boston Safe Deposit and
Trust Company (the "Custodian") and the Fund dated as of January 24, 1991 as
amended and restated from time to time (the "Custody Agreement");
(f) The Transfer Agency and Registrar Agreement between The
Shareholder Services Group, Inc. (the "Transfer Agent") and the Fund dated as of
January 24, 1991 as amended and restated from time to time;
(g) The Fund's most recent Registration Statement on Form N-2
(the "Registration Statement") under the Securities Act of 1933 and under the
1940 Act (File Nos. 33-37104 and 811-6179), as filed with the Securities and
Exchange Commission ("SEC") on January 24, 1991 relating to shares of the Fund's
Common Stock, $.01 par value per share, and all amendments thereto; and
(h) The Fund's most recent prospectus (the "Prospectus").
The Fund will furnish FDISG from time to time with copies, properly
certified or authenticated, of all amendments of or supplements to the
foregoing. Furthermore, the Fund 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 directors of the Fund, FDISG, as Administrator, will assist in
supervising various aspects of the Fund'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);
(b) Furnishing statistical and research data, data processing
services, clerical services, and internal legal, executive the administrative
services and stationery and office supplies in connection with the foregoing;
(c) Furnishing corporate secretarial services including
preparation and distribution of materials for Board of Directors meetings;
(d) Accounting and bookkeeping services (including the
maintenance of such accounts, books and records of the Fund as may be required
by section 31(a) of the 1940 Act and the rules thereunder);
(e) Internal auditing;
(f) Valuing the Fund's assets and calculating the net asset
value of the shares of the Fund at the close of trading on the New York Stock
Exchange (the "NYSE") on the last
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day on which the NYSE is open for trading of each week and month and at such
other times as the Board of Directors may reasonably request;
(g) Accumulating information for and, subject to approval by
the Fund's Treasurer, preparing reports to the Fund's shareholders of record and
the SEC including, but not necessarily limited to, Annual Reports and
Semi-Annual Reports on Form N-SAR;
(h) Preparing and filing various reports or other documents
required by federal, state and other applicable laws and regulations and by
stock exchanges on which the shares of the Fund are listed, other than those
filed or required to be filed by the Adviser or Transfer Agent;
(i) Preparing and filing the Fund's tax returns;
(j) Assisting the Adviser, at the Adviser's request, in
monitoring and developing compliance procedures for the Fund which will include,
among other matter, procedures to assist the Adviser in monitoring compliance
with the Fund's investment objective, policies, restrictions, tax matters and
applicable laws and regulations; and
(k) Preparing and furnishing the Fund (at the Fund's request)
with the performance information (including yield and total return information)
calculated in accordance with applicable U.S. securities laws and reporting to
external databases such information as may reasonably be requested.
In performing all services under this Agreement, FDISG shall act
in conformity with the Fund's Articles and By-Laws; the 1940 Act and the
Investment Advisers Act of 1940, as the same may be amended from time to time;
and the investment objective, investment policies and other practices and
policies set forth in the Fund's Registration Statement as such Registration
Statement and practices and policies may be amended from time to time.
4. ALLOCATION OF EXPENSES. FDISG shall bear all expenses in
connection with the performance of its services under this Agreement.
(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 Fund. The
compensation of such person or persons shall be paid by FDISG and no obligation
shall be incurred on behalf of the Fund in such respect.
(b) FDISG shall not be required to pay any of the following
expenses incurred by the Fund: 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; taxes and fees payable to
Federal, state and other governmental agencies; fees of Directors of the Fund
who are not
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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 Fund.
(c) 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 Fund will pay FDISG the fees in accordance with the Amended and
Restated Fee Agreement among the Fund, Boston Safe Deposit and Trust Company and
FDISG dated March 1, 1993 and attached hereto as Schedule A.
(d) The Fund 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, but
shall not be limited to, the items specified in Schedule B, annexed hereto and
incorporated herein, which schedule may be modified by FDISG upon not less than
thirty days' prior written notice to the Fund.
(e) FDISG will xxxx the Fund as soon as practicable after the
end of each calendar month, and said xxxxxxxx will be detailed in accordance
with the out-of-pocket schedule. The Fund will promptly pay to FDISG the amount
of such billing.
5. LIMITATION OF LIABILITY. FDISG shall not be liable for any error
of judgment or mistake of law or for any loss suffered by the Fund in connection
with the performance of its obligations and duties under this Agreement, except
a loss resulting from FDISG' willful misfeasance, bad faith or gross negligence
in the performance of such obligations and duties, or by reason of its reckless
disregard thereof. The Fund will indemnify FDISG against and hold it harmless
from any and all losses, claims, damages, liabilities of expenses (including
reasonable counsel fees and expenses) resulting from any claim, demand, action
or suit not resulting from the willful misfeasance, bad faith or gross
negligence of FDISG in the performance of such obligations and duties or by
reason of its reckless disregard thereof.
6. TERMINATION OF AGREEMENT.
(a) This Agreement shall become effective on the date hereof
and shall remain in force from year to year so long as such continuance is
specifically approved at least annually by the Board of Directors of the Fund or
unless terminated pursuant to the provisions of subsection (b) of this Section
6.
(b) This Agreement may be terminated at any time without
payment of any penalty, upon 60 days' written notice, by vote of the holders of
a majority of the outstanding voting securities of the Fund, or by vote of a
majority of the Board of Directors of the Fund, or by the FDISG.
7. AMENDMENT TO THIS AGREEMENT. No provisions of this Agreement may
be changed, discharged or terminated orally, but only by an instrument in
writing signed by the party against which enforcement of the change, discharge
or termination is sought.
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8. MISCELLANEOUS.
(a) Any notice or other instrument authorized or required by
this Agreement to be given in writing to the Fund or FDISG shall be sufficiently
given if addressed to that 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 Fund:
Preferred Income Fund Incorporated
c/o Flaherty & Xxxxxxxx Incorporated
000 X. Xxxxxxxx Xxxx-Xxxxx 000
Xxxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxxxx
To FDISG:
First Data Investor Services Group, Inc.
4400 Computer Drive, 2AW45
Xxxxxxxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxxxxxx X. Xxxxx, Esquire
(b) This Agreement shall extend to and shall be binding upon
the parties hereto and their respective successors and assigns; provided,
however, that this Agreement shall not be assignable without the written consent
of the other party.
(c) This Agreement shall be construed in accordance with the
laws of the Commonwealth of Massachusetts.
(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 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.
9. CONFIDENTIALITY. All books, records, information and data
pertaining to the business of the Fund that are exchanged or received pursuant
to the performance of FDISG' duties under this Agreement shall remain
confidential and shall not be voluntarily disclosed to any other person, except
as specifically authorized by the Fund or as may be required by law.
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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: /S/ XXXXXXX XXXXXX
Name: Xxxxxxx Xxxxxx
Title: Executive Vice President
PREFERRED INCOME FUND
INCORPORATED
By: /S/ XXXXXX X. XXXXXXXX
Name: Xxxxxx X. Xxxxxxxx
Title: President
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SCHEDULE A
FEE SCHEDULE
In consideration of the services which FDISG shall perform for the Fund
pursuant to this Agreement, the Fund hereby agrees to pay FDISG an aggregate
monthly fee at the annual rate of: 0.12 of 1.00% of the value of the Fund's
average monthly net assets which, for the purposes of calculating such fee, will
be deemed to be the average monthly value of the Fund's total assets minus the
sum of the Fund's liabilities (excluding aggregate liquidation preference on the
outstanding shares of the Fund's auction rate preferred stock and accumulated
dividends, if any, thereon).
The fee for the period from the date the Registration Statement is
declared effective by the Securities and Exchange Commission to the end on the
month during which the Registration Statement is declared effective 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.
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SCHEDULE B
PREFERRED INCOME FUND INCORPORATED
Out-Of-Pocket Expenses
Administration Agreement
Out-of Pocket expenses include, but are not limited to, the following:
o Postage
o Telephone and telecommunications charges
o Pricing services
o Travel to/from Board meetings
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AMENDMENT TO THE AMENDED AND
RESTATED ADMINISTRATION AGREEMENT
This Amendment dated as of October 7, 1998, is entered into by
PREFERRED INCOME FUND INCORPORATED (the "Fund") and FIRST DATA INVESTOR SERVICES
GROUP, INC. ("FDISG").
WHEREAS, the Fund and The Boston Company Advisors, Inc. ("Boston
Advisors") entered into an Administration Agreement dated as of January 24,
1991, which Agreement was amended and restated by the parties on March 3, 1993,
assigned by Boston Advisors to FDISG (then known as The Shareholder Services
Group, Inc.) on April 24, 1994, and further amended and restated by the parties
on December 1, 1996 (the "Agreement");
WHEREAS, the Fund and FDISG wish to further amend the Agreement;
NOW, THEREFORE, the parties hereto, intending to be legally bound
hereby, agree as follows:
I. Section 4(d) of the Agreement is deleted in its entirety and
replaced with the following:
(d) The Fund 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. FDISG
shall be entitled to xxxx the Fund for such out-of-pocket expenses only
upon the prior written approval of the Fund.
II. Schedule B to the Agreement is deleted in its entirety.
III. Except to the extent amended hereby, the Agreement shall
remain unchanged and in full force and effect and is hereby ratified and
confirmed in all respects as amended.
IN WITNESS WHEREOF, the undersigned have executed this Amendment as of
the date and year first written above.
PREFERRED INCOME FUND INCORPORATED
BY: /S/ XXXXXX X. XXXXXXXX
FIRST DATA INVESTOR SERVICES
GROUP, INC.
BY: /S/ _JACK XXXXXX
