EXHIBIT 99.3
THE MAINSTAY FUNDS
MAINSTAY STRATEGIC INCOME FUND
ADMINISTRATION AGREEMENT
ADMINISTRATION AGREEMENT, made as of the ____ day of ___________, 1997
between THE MAINSTAY FUNDS, a Massachusetts business trust (the "Trust"), on
behalf of the MAINSTAY STRATEGIC INCOME FUND (the "Fund"), and NYLIFE
DISTRIBUTORS INC., a New York corporation (the "Administrator").
W I T N E S S E T H
WHEREAS, the Trust is an open-end management investment company
registered under the Investment Company Act of 1940, as amended (the "1940
Act");
WHEREAS, the shares of beneficial interest of the Trust (the "Shares")
are divided into separate series, including the Fund, each of which has been
established pursuant to a written instrument executed by the Trustees of the
Trust, and the Trustees may from time to time terminate the Fund or establish
and terminate additional series of the Trust; and
WHEREAS, the Trust has been organized for the purpose of investing the
assets of each of its series, including the Fund, in securities and has retained
an investment adviser for this purpose and desires to avail itself of the
facilities available to the Administrator with respect to the administration of
its day to day business affairs, and the Administrator is willing to furnish
such administrative services on the terms and conditions hereinafter set forth;
NOW, THEREFORE, the parties agree as follows:
1. The Trust, on behalf of the Fund, hereby appoints the
Administrator to administer its business affairs, subject to the overall
supervision of the Trustees of the Trust for the period and on the terms set
forth in this Agreement. The Administrator hereby accepts such appointment and
agrees during such period to render the services herein described and to assume
the obligations set forth herein, for the compensation herein provided.
2. (a) Subject to the supervision of the Trustees, the Administrator
shall administer the Fund's business affairs and, in connection therewith, (i)
shall furnish the Fund with office facilities; (ii) shall be responsible for the
financial and accounting records required to be maintained by the Fund
(excluding those being maintained by the Fund's Custodian and Transfer Agent
except as to which the Administrator has
supervisory functions) and other than those being maintained by the Fund's
investment adviser; (iii) shall furnish the Fund with ordinary clerical,
bookkeeping and recordkeeping services at such office facilities; and (iv) shall
authorize and permit any of its directors, officers and employees who may be
elected or appointed as Trustees or officers of the Trust to serve in the
capacities in which they are elected or appointed. All services to be furnished
by the Administrator under this Agreement may be furnished through the medium of
any such directors, officers or employees of the Administrator.
(b) In connection with the services rendered by the Administrator
under this Agreement, the Administrator will bear all of the following expenses:
(i) the salaries and expenses of all personnel of the Trust and the
Administrator, except the fees and expenses of Trustees who are not interested
persons of the Administrator or of the Fund's investment adviser; and
(ii) all expenses incurred by the Administrator in connection with
administering the ordinary course of the Fund's business, other than those
assumed by the Fund, herein;
(c) The Fund assumes and will pay the expenses described below (where
any such category applies to more than one series of the Trust, the Fund shall
be liable only for its allocable portion of the expenses):
(i) the fees and expenses of any investment adviser or expenses
otherwise incurred by the Fund in connection with the management of the
investment and reinvestment of the assets of the Fund;
(ii) the fees and expenses of Trustees who are not interested persons
of the Administrator or any investment adviser;
(iii) the fees and expenses of the Fund's custodian which relate to
(A) the custodial function and the recordkeeping connected therewith, (B) the
maintenance of the required accounting records of the Fund not being maintained
by the Administrator, (C) the pricing of the Fund's Shares, including the cost
of any pricing service or services which may be retained pursuant to the
authorization of the Trustees of the Trust, and (D) for both mail and wire
orders, the cashiering function in connection with the issuance and redemption
of the Fund's Shares;
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(iv) the fees and expenses of the Trust's transfer and dividend
disbursing agent, which may be the custodian, which relate to the maintenance of
each shareholder account;
(v) the charges and expenses of legal counsel and independent
accountants for the Trust;
(vi) brokers' commissions and any issue or transfer taxes chargeable
to the Trust in connection with its securities transactions on behalf of the
Fund;
(vii) all taxes and business fees payable by the Fund to federal,
state or other governmental agencies;
(viii) the fees of any trade association of which the Trust may be a
member;
(ix) the cost of share certificates representing the Fund's Shares;
(x) the fees and expenses involved in registering and maintaining
registrations of the Trust and of its Shares with the Securities and Exchange
Commission, registering the Trust as a broker or dealer and qualifying its
Shares under state securities laws, including the preparation and printing of
the Trust's registration statements and prospectuses for filing under federal
and state securities laws for such purposes;
(xi) allocable communications expenses with respect to investor
services and all expenses of shareholders' and Trustees' meetings and of
preparing, printing and mailing reports to shareholders in the amount necessary
for distribution to the shareholders; and
(xii) litigation and indemnification expenses and other extraordinary
expenses not incurred in the ordinary course of the Fund's business.
3. The Fund hereby agrees to reimburse the Administrator for the
organization expenses of, and the expenses incurred in connection with, the
initial offering of Shares of the Fund.
4. As full compensation for the services performed and the facilities
furnished by the Administrator, the Fund shall pay the Administrator a fee at an
annual rate of 0.30% of the average daily net assets of the Fund. This fee will
be computed daily and paid monthly to the Administrator. This fee will be
chargeable only to the Fund as set forth above, and no other series of the Trust
shall be liable for the fee due and payable
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hereunder. The Fund shall not be liable for any expenses of any other series of
the Trust.
5. The Administrator assumes no responsibility under this Agreement
other than to render the services called for hereunder, and specifically assumes
no responsibilities for investment advice or the investment or reinvestment of
the assets of the Funds.
6. The Administrator shall not be liable for any error of, judgment
or for any loss suffered by the Fund, in connection with the matters to which
this Agreement relates, except a loss resulting from willful misfeasance, bad
faith or gross negligence on its part in the performance of its duties or from
reckless disregard by it of its obligations and duties under this Agreement.
7. This Agreement shall continue in effect until terminated;
provided, however, that this Agreement may be terminated by the Trust on the
behalf of the Fund at any time, without the payment of any penalty, by the
Trustees of the Trust or by vote of a majority of the outstanding voting
securities (as defined in the 0000 Xxx) of the Fund, or by the Administrator at
any time, without the payment of any penalty, on not more than 60 days' nor less
than 30 days' written notice to the other party. This Agreement shall terminate
automatically in the event of its assignment (as defined in the 1940 Act).
8. Nothing in this Agreement shall limit or restrict the right of any
director, officer or employee of the Administrator who may also be a Trustee,
officer or employee of the Trust to engage in any other business or to devote
his time and attention in part to the management or other aspects of any
business, whether of a similar or a dissimilar nature, nor limit or restrict the
right of the Administrator to engage in any other business or to render services
of any kind to any other business or to render services of any kind to any other
corporation, trust, firm, individual or association.
9. During the term of this Agreement, the Trust agrees to furnish the
Administrator at its principal office with copies of all prospectuses, proxy
statements, reports to shareholders, sales literature, or other material
prepared for distribution to shareholders of the Fund or the public, which refer
in any way to the Administrator, prior to use thereof and not to use such
material if the Administrator reasonably objects in writing within five business
days (or such other time as may be mutually agreed) after receipt thereof. In
the event of termination of this Agreement, the Trust will continue to furnish
to the Administrator copies of any of the above-mentioned materials
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which refer in any way to the Administrator. The Trust shall furnish or
otherwise make available to the Administrator such other information relating to
the business affairs of the Fund as the Administrator at any time, or from time
to time, reasonably requests in order to discharge its obligations hereunder.
10. This Agreement may be amended by mutual written consent.
11. Any notice or other communication required to be given pursuant
to this Agreement shall be deemed duly given if delivered or mailed by
registered mail, postage prepaid, (1) to the Administrator at 000 Xxxxxx Xxxx
Xxxx, Xxxxxxxxxx, Xxx Xxxxxx 00000; or (2) to the Trust at 00 Xxxxxxx Xxxxxx,
Xxx Xxxx, XX 00000.
12. This Agreement shall be governed by and construed in accordance
with the laws of the State of New York.
13. It is understood and expressly stipulated that none of the
Trustees, officers, agents or shareholders of the Trust shall be personally
liable hereunder. The name "The MainStay Funds" is the designation of the Trust
for the time being under a Declaration of Trust dated January 9, 1986, as
amended, and all persons dealing with the Trust must look solely to the property
of the Trust for the enforcement of any claims against the Trust as neither the
Trustees, officers, agents or shareholders assume any personal liability for
obligations entered into on behalf of the Trust. The Trust was formerly
designated the "XxxXxx-Xxxxxxx MainStay Series Fund." No series of the Trust
shall be liable for any claims against any other series of the Trust.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be executed by their officers designated below as of the day and year first
above written.
MAINSTAY STRATEGIC INCOME FUND
THE MAINSTAY FUNDS
By:________________________________
NYLIFE DISTRIBUTORS INC.
By:________________________________
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