Exhibit 99.B9(a)
ADMINISTRATIVE SERVICES AGREEMENT
PBHG ADVISOR FUNDS, INC.
ADMINISTRATIVE SERVICES AGREEMENT ("Agreement") made as of the 1st day
of April, 1998 by and between PBHG Advisor Funds, Inc., a Maryland corporation
(the "Company"), and PBHG Fund Services, a Pennsylvania business trust (the
"Administrator").
W I T N E S S E T H:
WHEREAS, the Company is engaged in business as an open-end management
investment company and registered as such under the Investment Company Act of
1940, as amended (the "1940 Act"); and
WHEREAS, the Company desires to retain the Administrator to provide
administrative services to the Company and each of its several series which are
identified in Schedule A hereto (the "Funds"), in the manner and on the terms
and conditions hereinafter set forth; and
WHEREAS, the Company and the Administrator propose to engage a
sub-administrator (the "Sub-Administrator") to provide certain administrative
services to the Company and the Funds, subject to the approval of the Company's
Board of Directors;
NOW THEREFORE, in consideration of the premises and the mutual
covenants and agreements hereinafter set forth, the parties hereto, intending to
be legally bound, do hereby agree as follows:
1. DUTIES AND RESPONSIBILITIES OF THE ADMINISTRATOR.
The Administrator shall oversee the administration of the Company's and
each Fund's business and affairs as set forth herein and shall provide certain
services required for effective administration of the Company and the Funds. In
connection therewith, the Administrator shall:
1.1. OFFICE AND OTHER FACILITIES. Furnish, without cost to the Company,
or provide and pay the cost of, such office facilities, furnishings, and office
equipment as are necessary for the performance of the Administrator's duties to
the Company under this Agreement.
1.2. PERSONNEL. Provide, without additional remuneration from or other
cost to the Company, the services of individuals competent to perform all of the
Administrator's obligations under this Agreement.
1.3. AGENTS. Assist the Company in selecting, coordinating the
activities of, supervising and acting as liaison with any other person or agent
engaged by the Company, including the Company's depository agent or custodian,
consultants, transfer agent, sub-transfer agents, intermediaries with respect to
mutual fund alliance programs, dividend disbursing agent, Sub-Administrator,
independent accountants, and independent legal counsel. The Administrator shall
also monitor the functions of such persons and agents, including without
limitation the compliance of the Company and the Company's custodians with Rule
17f-5 under the 1940 Act, if appropriate.
1.4. DIRECTORS AND OFFICERS. Authorize and permit the Administrator's
directors, officers, and employees that may be elected or appointee as directors
or officers of the Company to serve in such capacities, without remuneration
from or additional cost to the Company.
1.5. BOOKS AND RECORDS. Maintain customary records, on behalf of the
Company, in connection with the performance of the Administrator's duties under
this Agreement. The Administrator also will monitor and oversee the performance
of the agents specified in Section 1.3. above, to ensure that all financial,
accounting, corporate, and other records required to be maintained and preserved
by the Company or on its behalf will be maintained in accordance with applicable
laws and regulations.
1.6. COST OVERSIGHT. Monitor and review activities and procedures of
the Company and its agents identified in Section 1.3. above, in order to
identify and seek to obtain possible service improvements and cost reductions.
In connection therewith, the Administrator shall, on a quarterly basis, prepare
and submit to the Company a pro forma budget or similar document concerning the
estimated costs of providing the services to the Company and shall monitor and
periodically report to the Company's Board of Directors information and analysis
about the actual expenses incurred in providing such services.
1.7. ACCOUNTING AND COMPLIANCE POLICIES AND PROCEDURES. Assist in
developing, reviewing, maintaining, and monitoring the effectiveness of Company
accounting and compliance policies and procedures, including portfolio valuation
procedures, expense allocation procedures, and personal trading procedures, and
the Company's Code of Ethics. The Administrator also will assist and coordinate
participation by the Company and its agents in any audit by its outside auditors
or any examination by federal or state regulatory authorities or any
self-regulatory organization. The Administrator also will oversee and coordinate
the activities of Company accountants, outside counsel, and other experts in
these audits or examinations.
1.8. SYSTEMS. Assist in developing, implementing, and monitoring the
Company's use of automated systems for the purchase, sale, redemption and
transfer of Company shares and the payment of Rule 12b-1 service fees to
broker-dealers and others that
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provide personal services, distribution support services, and/or account
maintenance services to shareholders, and for recording and tracking such
transactions and/or payments. The Administrator also will assist in developing,
implementing, and monitoring the Company's use of automated communications
systems with brokers, dealers, custodians, and other service providers,
including without limitation trade clearance systems.
1.9. REPORTS TO THE COMPANY. Furnish to or place at the disposal of the
Company such information, reports, evaluations, analysis, and opinions relating
to its administrative functions and the administrative functions performed by
the Sub-Administrator, as the Company may, at any time or from time to time,
reasonably request or as the Administrator may deem helpful to the Company. The
Administrator also will assist in the preparation of agendas and other materials
for meetings of the Company's Board of Directors and will attend such meetings.
1.10. REPORTS AND FILINGS. Provide appropriate assistance in the
development and/or preparation of all reports and communications by the Company
to Company shareholders and all reports and filings necessary to maintain the
registrations and qualifications of the Company's shares under federal
securities law.
1.11. SHAREHOLDER INQUIRIES. Respond to all inquiries from Company
shareholders or otherwise answer communications from Company shareholders if
such inquiries or communications are directed to the Administrator. If any such
inquiry or communication would be more properly answered by one of the agents
listed in Section 1.3. above, the Administrator will coordinate, as needed, the
provision of their response.
2. ALLOCATION OF EXPENSES.
2.1. EXPENSES PAID BY THE ADMINISTRATOR.
2.1.1. IN GENERAL. The Administrator shall bear all of its own
expenses in connection with the performance of its duties under this Agreement.
2.1.2. SALARIES AND FEES OF DIRECTORS AND OFFICERS. The
Administrator shall pay all salaries, expenses, and fees, if any, of the
directors, officers, and employees of the Administrator who are directors,
officers, or employees of the Company.
2.1.3. WAIVER OR ASSUMPTION AND REIMBURSEMENT OF COMPANY
EXPENSES BY THE ADMINISTRATOR. The waiver or assumption and reimbursement by the
Administrator of any expense of the Company that the Administrator is not
required by this Agreement to waive, or assume or reimburse, shall not obligate
the Administrator to waive, assume, or reimburse the same or any similar expense
of the
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Company on any subsequent occasion, unless so required pursuant to a separate
agreement between the Company and the Administrator.
2.2. EXPENSES PAID BY THE COMPANY. The Company shall bear all expenses
of its organization, operation, and business not specifically waived, assumed,
or agreed to be paid by the Administrator as provided in this Agreement or any
other agreement between the Company and the Administrator, and as described in
the Company's then-current Prospectuses and Statements of Additional
Information.
3. FEES.
3.1. COMPENSATION RATE. As compensation for all services rendered,
facilities provided, and expenses paid and any expense waived or assumed and
reimbursed by the Administrator, the Company shall pay the Administrator a fee
per Fund at the annual rate of .15% of the average daily net assets of each
Fund.
3.2. METHOD OF COMPUTATION. The Administrator's fee shall accrue on
each calendar day and the sum of the daily fee accruals shall be paid monthly to
the Administrator by the fifth (5th) business day of the next calendar month.
The daily fee accruals shall be computed by multiplying the fraction of one (1)
over the number of calendar days in the year by the applicable annual rates
described in Section 3.1. above, and multiplying this product by the net assets
of the Funds, as determined in accordance with the current Prospectuses of the
Company, as of the close of business on the last preceding business day on which
the Company was open for business.
3.3. PRORATION OF FEE. If this Agreement becomes effective or
terminates before the end of any month, the fee for the period from the
effective date to the end of such month or from the beginning of such month to
the date of termination, as the case may be, shall be prorated according to the
proportion which such period bears to the full month in which such effectiveness
or termination occurs.
4. ADMINISTRATOR'S USE OF THE SERVICES OF OTHERS.
The Administrator may at its own cost employ, retain, or otherwise
avail itself of the services or facilities of other persons or organizations for
the purpose of providing the Administrator or the Company with such information,
advice, or assistance as the Administrator may deem necessary, appropriate, or
convenient for the discharge of its obligations hereunder or otherwise helpful
to the Administrator, including consulting, monitoring, and evaluation services
concerning the Company and the Funds.
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5. OWNERSHIP AND CONFIDENTIALITY OF RECORDS.
All records required to be maintained and preserved by the Company,
pursuant to rules or regulations of the Securities and Exchange Commission under
Section 31(a) of the 1940 Act, and maintained and preserved by the Administrator
on behalf of the Company, are the property of the Company and shall be
surrendered by the Administrator promptly on request by the Company. The
Administrator shall not disclose or use any record or information obtained
pursuant to this Agreement in any manner whatsoever except as expressly
authorized by this Agreement and applicable law. The Administrator shall keep
confidential any information obtained in connection with its duties hereunder
and shall disclose such information only if the Company has authorized such
disclosure or if such disclosure is expressly required by applicable law or
federal or state regulatory authorities.
6. REPORTS TO THE ADMINISTRATOR.
The Company shall furnish or otherwise make available to the
Administrator such Prospectuses, Statements of Additional Information, financial
statements, proxy statements, reports, and other information relating to the
business and affairs of the Company, as the Administrator may, at any time or
from time to time, reasonably require in order to discharge its obligations
under this Agreement.
7. SERVICES TO OTHER CLIENTS.
Nothing herein contained shall limit the freedom of the Administrator
or any affiliated person of the Administrator to render corporate administrative
services to other investment companies or to engage in other business
activities; however, so long as this Agreement or any extension, renewal, or
amendment hereof shall remain in effect or until the Administrator shall
otherwise consent, the Administrator shall be the only administrator to the
Company .
8. LIMITATION OF LIABILITY OF THE ADMINISTRATOR AND INDEMNIFICATION BY THE
COMPANY.
8.1. LIMITATION OF LIABILITY.
8.1.1. Neither the Administrator nor any of its directors,
officers, employees or agents performing services for the Company, at the
direction or request of the Administrator in connection with the Administrator's
discharge of its obligations undertaken or reasonably assumed with respect to
this Agreement, shall be liable for any act or omission in the course of or in
connection with the Administrator's services hereunder, including any error of
judgment or mistake of law or for any loss suffered by the Company, in
connection with the matters to which this Agreement relates; provided, that
nothing herein contained
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shall be construed to protect the Administrator or any such person against any
liability to the Company or its shareholders to which the Administrator or such
person would otherwise be subject by reason of willful misfeasance, bad faith,
or negligence in the performance of its or their duties on behalf of the
Company.
8.1.2. The Administrator's directors, officers, employees and
agents performing services for the Company shall be covered errors and omissions
and directors and officers liability insurance, as appropriate, under a policy
maintained by the Administrator or an affiliate of the Administrator.
8.1.3. The Administrator may apply to the Board of Directors
of the Company at any time for instructions and may consult counsel for the
Company or its own counsel and with accountants and other experts with respect
to any matter arising in connection with the Administrator's duties, and the
Administrator shall not be liable or accountable for any act on taken or omitted
by it in good faith in accordance with such instruction or with the opinion of
such counsel, accountants, or other experts.
8.1.4. The Administrator shall at all times have the right to
mitigate or cure any and all losses, damages, costs, charges, fees,
disbursements, payments and liabilities to the Company and its shareholders.
8.2. INDEMNIFICATION BY THE COMPANY.
8.2.1 As long as the Administrator acts in good faith and with
due diligence and without negligence, the Company shall indemnify the
Administrator and hold it harmless from and against any and all actions, suits,
and claims, whether groundless or otherwise, and from and against any and all
losses, damages (excluding consequential, punitive or other indirect damages),
costs, charges, reasonable counsel fees and disbursements, payments, expenses,
and liabilities (including reasonable investigation expenses) arising directly
or indirectly out of the administrative services or any other service rendered
to the Company hereunder. The indemnity and defense provisions set forth herein
shall indefinitely survive the termination of this Agreement.
8.2.2. The rights hereunder shall include the right to
reasonable advances of defense expenses in the event of any pending or
threatened litigation with respect to which indemnification hereunder may
ultimately be merited. In order that the indemnification provision contained
herein shall apply, however, it is understood that if in any case the Company
may be asked to indemnify or hold the Administrator harmless, the Board of
Directors of the Company shall be fully and promptly advised of all pertinent
facts concerning the situation in question, and it is further understood that
the Administrator will use all reasonable care to identify and notify the Board
of Directors of the Company promptly concerning any situation which presents or
appears likely to present the probability
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of such a claim for indemnification against the Company, but failure to do so in
good faith shall not affect the rights hereunder.
8.2.3. The Administrator shall secure and maintain a fidelity
bond, or be covered by an affiliate's blanket fidelity bond, in at least the
amount required by Rule 17g-1 under the 1940 Act for joint insurance bonds of
investment companies.
9. INDEMNIFICATION BY THE ADMINISTRATOR.
9.1. The Administrator shall indemnify the Company, its officers and
directors and hold them harmless from and against any and all actions, suits,
and claims, whether groundless or otherwise, and from and against any and all
losses, damages (excluding consequential, punitive or other indirect damages),
costs, charges, reasonable counsel fees and disbursements, payments, expenses,
and liabilities (including reasonable investigation expenses) arising directly
or indirectly out of the administrative services or any other service rendered
to the Company hereunder and arising or based upon the willful misfeasance, bad
faith, or negligence of the Administrator, its directors, officers, employees,
and agents in the performance of its or their duties on behalf of the Company.
The indemnity and defense provisions set forth herein shall indefinitely survive
the termination of this Agreement.
9.2. The rights hereunder shall include the right to reasonable
advances of defense expenses in the event of any pending or threatened
litigation with respect to which indemnification hereunder may ultimately be
merited. In order that the indemnification provision contained herein shall
apply, however, it is understood that if in any case the Administrator may be
asked to indemnify or hold the Company, its officers, and directors harmless,
the Administrator shall be fully and promptly advised of all pertinent facts
concerning the situation in question, and it is further understood that the
Company will use all reasonable care to identify and notify the Administrator
promptly concerning any situation which presents or appears likely to present
the probability of such a claim for indemnification against the Administrator,
but failure to do so in good faith shall not affect the rights hereunder.
10. FORCE MAJEURE.
In the event the Administrator is unable to perform its obligations or
duties under the terms of this Agreement because of any act of God, strike,
riot, act of war, equipment failure, power failure or damage of the causes
reasonably beyond its control, the Administrator shall not be liable for any and
all losses, damages, costs, charges, counsel fees, payments, expenses or
liability to any other party (whether or not a party to this Agreement)
resulting from such failure to perform its obligations or duties under this
Agreement or otherwise from such causes. This provision, however, shall in no
way excuse the Administrator from being liable to the Company for any and all
losses, damages, costs,
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charges, counsel fees, payments and expenses incurred by the Company due to the
non-performance or delay in performance by the Administrator of its duties and
obligation under this Agreement if such non-performance or delay in performance
could have been reasonably been prevented by the Administrator through back-up
systems and other procedures commonly employed by other administrators in the
mutual fund industry, provided that the Administrator shall have the right, at
all times, to mitigate or cure any losses, including by making adjustments or
corrections to any current or former shareholder accounts.
11. RETENTION OF SUB-ADMINISTRATOR.
The Administrator may retain a Sub-Administrator to perform corporate
administrative services to the Company. The retention of a Sub-Administrator
shall be at the cost and expense of the Administrator. The Administrator shall
pay and shall be solely responsible for the payment of the fees of the
Sub-Administrator for the performance of its services for the Company.
12. TERM OF AGREEMENT.
The term of this Agreement shall begin on the day and year first
written above, and unless sooner terminated as hereinafter provided, shall
continue in effect for an initial period that will expire on December 31, 1999.
Thereafter, this Agreement shall continue in effect from year to year, subject
to the termination provisions and all other terms and conditions hereof. The
Administrator shall furnish to the Company, promptly upon its request, such
information as may be reasonably necessary to evaluate the terms of this
Agreement or any extension, renewal, or amendment thereof.
The assignment (as that term is defined in Section (2)(a)(4) of the
1940 Act and rules thereunder) of this Agreement or any rights or obligations
thereunder shall be prohibited by either party without the written consent of
the other party. This Agreement shall inure to the benefit of and be binding
upon the parties and their respective permitted successors and assigns.
13. TERMINATION OF AGREEMENT.
This Agreement may be terminated by any of the parties hereto, without
the payment of any penalty:
(a) for a material breach of this Agreement, upon thirty (30)
days prior written notice to the other parties; provided, that this Agreement
shall not terminate if such material breach is cured within such thirty (30) day
period.
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(b) following the initial term of this Agreement, for any
reason upon ninety (90) days' prior written notice to the other parties;
provided, that in the case of termination by the Company such action shall have
been authorized by resolution of the Board of Directors of the Company or by a
vote of a majority of the outstanding voting securities of the Company or, in
the case of termination with respect to a particular Fund, by a resolution of
the Board of Directors of the Company or by a vote of a majority of the
outstanding voting securities of such Fund. In the case of termination by the
Administrator, such termination shall not be effective until the Company and the
Administrator shall have contracted with one or more persons to serve as
successor Administrator(s) for the Company and such person(s) shall have assumed
such position.
14. AMENDMENT AND ASSIGNMENT OF AGREEMENT.
Any amendment to this Agreement shall be in writing and signed by the
parties hereto provided, that no material amendment shall be effective unless
authorized by resolution of the Board of Directors of the Company or by a
majority of the outstanding voting securities of the Company or, in the case of
an amendment to this Agreement with respect to a particular Fund, by a
resolution of the Board of Directors of the Company or a vote of majority of the
outstanding voting securities of such Fund.
15. MISCELLANEOUS.
15.1. NOTICES. Any notice under this Agreement shall be given in
writing, addressed and delivered, or mailed postpaid, (i) if to the
Administrator, to PBHG Fund Services, 000 Xxxxxxxxx Xxxx, Xxxxx, XX 00000,
Attention: Xxxxx Xxxxxxxx, and (ii) if to the Company, to PBHG Advisor Funds,
Inc., 000 Xxxxxxxxx Xxxx, Xxxxx, XX 00000, Attention: Xxxxxxx Xxxxxxxxxx.
15.2. CAPTIONS. The captions contained in this Agreement are included
for convenience of reference only and in no way define or delineate any of the
provisions hereof or otherwise affect their construction or effect.
15.3. INTERPRETATION. Nothing herein contained shall be deemed to
require the Company to take any action contrary to its Articles of Incorporation
or By-Laws, or any applicable statutory or regulatory requirement to which it is
subject or by which it is bound, or to relieve or deprive the Board of Directors
of its responsibility for and control of the conduct of the affairs of the
Company.
15.4. DEFINITIONS. Any question of interpretation of any term or
provision of this Agreement having a counterpart in or otherwise derived from a
term or provision of the 1940 Act shall be resolved by reference to such term or
provision of the 1940 Act and to interpretations thereof, if any, by the United
States courts or, in the absence of any
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controlling decision of any such court by rules, regulations, or orders of the
Securities and Exchange Commission validly issued pursuant to the 1940 Act. In
addition, where the effect of a requirement of the 1940 Act reflected in any
provision of this Agreement is relaxed by a rule, regulation, or order of the
Securities and Exchange Commission, whether of special or of general
application, such provision shall be deemed to incorporate the effect of such
rule, regulation, or order.
15.5. SEVERABILITY. 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.
15.6. GOVERNING LAW. Except insofar as the 1940 Act or other federal
laws and regulations may be controlling, this Agreement shall be governed by,
and construed and enforced in accordance with, the laws of the Commonwealth of
Pennsylvania.
IN WITNESS WHEREOF, the parties have caused this Agreement to be signed
by their respective officers thereunto duly authorized and their respective
corporate seals to be hereunto affixed, as of the day and year first above
written.
ATTEST: PBHG ADVISOR FUNDS, INC.
/s/ Xxxx X. Xxxx By: /s/ Xxx X. Xxxxxxxx
------------------------------------ ---------------------------------
Title: General Counsel & Secretary Title: Vice President
ATTEST: PBHG FUND SERVICES
/s/ Xxxx X. Xxxx By: /s/ Xxxxx X. Xxxxxxxx
------------------------------------ ---------------------------------
Title: General Counsel & Secretary Title: President
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SCHEDULE A
PBHG ADVISOR FUNDS, INC.
PBHG Advisor Funds, Inc. consists of the following Funds, each of which
is subject to this Agreement:
PBHG Advisor Core Value Fund
PBHG Advisor Blue Chip Growth Fund
PBHG Advisor Global Technology & Communications Fund
PBHG Advisor Growth II Fund
PBHG Advisor Growth Opportunities Fund
PBHG Advisor High Yield Fund PBHG Advisor
Large Cap Concentrated Fund
PBHG Advisor New Contrarian Fund
PBHG Advisor Trend Fund
PBHG Advisor Cash Reserves Fund
PBHG Advisor Value Opportunities Fund
PBHG Advisor New Opportunities Fund
PBHG Advisor Enhanced Equity Fund
PBHG Advisor Master Fixed Income Fund
PBHG Advisor Short-Term Government Fund
PBHG Advisor REIT Fund
Dated: April 1, 1998
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