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EXHIBIT (9)(a)
MANAGEMENT AND ADMINISTRATION AGREEMENT
This Agreement is made this ___ day of ___________, 1998, by and among
Governor Funds, a Delaware business trust, (the "Trust"), 0000 Xxxxxxx Xxxx,
Xxxxxxxx, Xxxx 00000, BISYS Fund Services Ohio, Inc., an Ohio corporation
("BISYS"), 0000 Xxxxxxx Xxxx, Xxxxxxxx, Xxxx 00000, and Governors Group
Advisors, Inc., ("Governors") a wholly-owned subsidiary of Keystone Financial,
Inc. (Governors and BISYS are collectively referred to as the "Administrators").
WHEREAS, the Trust is an open-end management investment company,
organized as a Delaware business trust and registered with the Securities and
Exchange Commission (the "Commission") under the Investment Company Act of 1940,
as amended (the "1940 Act"); and
WHEREAS, the Trust desires to retain the Administrators to provide, as
co-administrators, certain management and administration services to certain
investment portfolios of the Trust (individually, a "Fund," and collectively,
the "Funds"), and may retain the Administrators to serve in such capacity with
respect to additional investment portfolios of the Trust, all as now or
hereafter may be identified in Schedule A hereto as such Schedule may be amended
from time to time; and
NOW, THEREFORE, in consideration of the mutual premises and covenants
herein set forth, the parties agree as follows:
1. Services as Managers and Administrators
Subject to the direction and control of the Board of Trustees of the
Trust, and as delineated on Schedule 1 to the Agreement, the Administrators
agree to assist in supervising various aspects of each Fund's operations except
those performed by the investment adviser for the Funds under its Investment
Advisory Agreement, the custodian for the Funds under its Custody Agreement, the
transfer agent for the Funds under its Transfer Agency Agreement and the fund
accountant for the Funds under its Fund Accounting Agreement.
The Administrators will maintain office facilities (which may be in the
offices of the Administrators or an affiliate but shall be in such location as
the Trust shall reasonably determine); furnish statistical and research data,
clerical, certain bookkeeping services and stationery and office supplies;
prepare the periodic reports to the Commission on Form N-SAR or any replacement
forms therefor; compile data for, assist the Trust or its designee in the
preparation of, and file, all the Funds' federal and state tax returns and
required tax filings other than those required to be made by the Funds'
custodian and transfer agent; prepare compliance filings pursuant to state
securities laws with the advice of the Trust's counsel; assist to the extent
requested by the Trust with the Trust's preparation of its Annual and
Semi-Annual Reports to Shareholders and its Registration Statements (on Form
N-1A or any replacement therefor); compile data for, prepare and file timely
Notices to the Commission required pursuant to Rule 24f-2 under the 1940 Act;
keep and maintain the financial accounts and records of the Funds, including
calculation of daily expense accruals; in the case of money market funds,
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review of the amount of the deviation, if any, of the current net asset value
per share (calculated using available market quotations or an appropriate
substitute that reflects current market conditions) from each money market
fund's amortized cost price per share; and generally assist in all aspects of
the operations of the Funds. In compliance with the requirements of Rule 31a-3
under the 1940 Act, the Administrators hereby agree that all records which each
maintains for the Trust are the property of the Trust and further agree to
surrender promptly to the Trust any of such records upon the Trust's request.
The Administrators further agree to preserve for the periods prescribed by Rule
31a-2 under the 1940 Act the records required to be maintained by Rule 31a-1
under the 1940 Act. The Administrators may delegate some or all of their
responsibilities under this Agreement.
The Administrators may, at their expense, subcontract with any entity
or person concerning the provision of the services contemplated hereunder;
provided, however, that the Administrators shall not be relieved of any of their
obligations under this Agreement by the appointment of such subcontractor and
provided further, that the Administrators shall be responsible, to the extent
provided in Section 4 hereof for all acts of such subcontractor as if such acts
were their own.
2. Fees; Expenses; Expense Reimbursement
In consideration of services rendered and expenses assumed pursuant to
this Agreement, the Administrators shall be entitled jointly to a fee based on
the average net assets of the Trust, paid by each of the Funds on the first
business day of each month, or at such time(s) as the Administrators shall
request and the parties hereto shall agree, a fee computed daily and paid as
specified below calculated at the applicable annual rate set forth on Schedule A
hereto. The fee for the period from the day of the month this Agreement is
entered into until the end of that month shall be prorated according to the
proportion which 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.
For the purpose of determining fees payable to the Administrators, the
value of the net assets of a particular Fund shall be computed in the manner
described in the Trust's Declaration of Trust or in the Prospectus or Statement
of Additional Information respecting that Fund as from time to time is in effect
for the computation of the value of such net assets in connection with the
determination of the liquidating value of the shares of such Fund.
Notwithstanding anything to the contrary, amounts owed by the Trust to the
Administrators shall only be paid out of the assets and property of the
particular Fund involved.
The Administrators will from time to time employ or associate with
themselves such person or persons as the Administrators may believe to be
particularly fitted to assist them in the performance of this Agreement. Such
person or persons may be partners, officers, or employees who are employed by
the Administrators and the Trust. The compensation of such person or persons
shall be paid by the Administrators and no obligation may be incurred on behalf
of the Funds in such respect. Other expenses to be incurred in the operation of
the Funds including taxes, interest, brokerage fees and commissions, if any,
fees of Trustees who are not partners,
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officers, directors, shareholders or employees of the Administrators or the
investment adviser or distributor for the Funds, Commission fees and state Blue
Sky qualification and renewal fees and expenses, advisory fees, pricing service
fees, custodian fees, transfer and dividend disbursing agents' fees, fund
accounting fees, certain insurance premiums, outside and, to the extent
authorized by the Trust, inside auditing and legal fees and expenses, costs of
maintenance of the Trust's existence, typesetting and printing prospectuses for
regulatory purposes and for distribution to current shareholders of the Funds,
costs of shareholders' and Trustees' reports and meetings, fees incurred under
the Trust's Distribution and Shareholder Service Plan and Administrative
Services Plan and any extraordinary expenses will be borne by the Funds.
3. Proprietary and Confidential Information
Each Administrator agrees on behalf of itself and its partners and
employees to treat confidentially and as proprietary information of the Trust
all records and other information relative to the Trust and prior, present, or
potential shareholders, and not to use such records and information for any
purpose other than performance of its responsibilities and duties hereunder,
except after prior notification to and approval in writing by the Trust, which
approval shall not be unreasonably withheld and may not be withheld where the
Administrator may be exposed to civil or criminal contempt proceedings for
failure to comply, when requested to divulge such information by duly
constituted authorities, or when so requested by the Trust.
4. Limitation of Liability
Each Administrator shall not be liable for any loss suffered by the
Funds in connection with the matters to which this Agreement relates, except for
a loss resulting from willful misfeasance, bad faith or negligence on its part
in the performance of its duties or from reckless disregard by it of its
obligations and duties under this Agreement. Any person, even though also a
partner, employee, or agent of the Administrators, who may be or become an
officer, Trustee, employee, or agent of the Trust or the Funds shall be deemed,
when rendering services to the Trust or the Funds, or acting on any business of
that party, to be rendering such services to or acting solely for that party and
not as a partner, employee, or agent or one under the control or direction of
the Administrators even though paid by it. The parties hereto agree that this
Agreement shall not create any joint and/or several liability between the
Administrators with respect to services provided by any particular Administrator
as set forth herein and the Schedules hereto.
5. Term
This Agreement shall become effective as of the date first written
above (or, if a particular Fund is not in existence on that date, on the date an
amendment to Schedule A to this Agreement relating to that Fund is executed)
and, unless sooner terminated as provided herein, shall continue until June 30,
2001, and thereafter shall be renewed automatically for successive one year
terms, unless written notice not to renew is given by the non-renewing party to
the other parties at least 60 days prior to the expiration of the then-current
term. This Agreement is terminable with respect to a particular Fund through a
failure to renew at the end of a one-year term; upon mutual agreement of the
parties hereto; upon 180 days' written notice by the Trust
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after the initial term hereof but only in connection with the reorganization of
the Funds into another registered management investment company; or for "cause"
(as defined below) by the party alleging "cause," on not less than 60 days
notice by the Trust's Board of Trustees or by the Administrators. Written notice
not to renew may be given for any reason, with or without "cause."
For purposes of this Agreement, "cause" shall mean (a) willful
misfeasance, bad faith, gross negligence, multiple negligent acts by an
Administrator which in the aggregate are determined by the Trust's Board of
Trustees to constitute a serious failure to perform satisfactorily such
Administrator's obligations hereunder or reckless disregard on the part of the
party to be terminated with respect to its obligations and duties set forth
herein; (b) a final, unappealable judicial, regulatory or administrative ruling
or order in which the party to be terminated has been found guilty of criminal
or unethical behavior in the conduct of its business; (c) the dissolution or
liquidation of either party or other cessation of business other than a
reorganization or recapitalization of such party as an ongoing business; (d)
financial difficulties on the part of the party to be terminated which are
evidenced by the authorization or commencement of, or involvement by way of
pleading, answer, consent, or acquiescence in, a voluntary or involuntary case
under Title 11 of the United States Code, as from time to time in effect, or any
applicable law, other than said Title 11, of any jurisdiction relating to the
liquidation or reorganization of debtors or to the modification or alteration of
the rights of creditors; or (e) any circumstance which substantially impairs the
performance of the obligations and duties of the party to be terminated, or the
ability to perform those obligations and duties as contemplated herein.
Notwithstanding the foregoing, the absence of an annual review of this Agreement
by the Board of Trustees shall not, in and of itself, constitute "cause" as used
herein.
6. Governing Law and Matters Relating to the Trust as a Delaware
Business Trust
This Agreement shall be governed by the law of the State of Delaware.
Governor Funds is a business trust organized under the laws of Delaware and
under a Declaration of Trust, to which reference is hereby made and a copy of
which is on file at the office of the Secretary of State of Delaware as required
by law, and to any and all amendments thereto so filed or hereafter filed. The
obligations of "Governor Funds" entered into in the name or on behalf thereof by
any of the Trustees, officers, employees or agents are made not individually,
but in such capacities, and are not binding upon any of the Trustees, officers,
employees, agents or shareholders of the Trust personally but bind only the
assets of the Trust, and all persons dealing with any of the Funds of the Trust
must look solely to the assets of the Trust belonging to such Fund for the
enforcement of any claims against the Trust.
7. Year 2000 Compliant
The Administrators represent and warrant that all services rendered and
all computer systems used in the performance of the obligations under the
Management and Co-Administration Agreement shall be Year 2000 Compliant. "Year
2000 Compliant" means that the services and systems are designed to and shall:
(a) operate in the year 2000 and later with four digit year date
capability;
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(b) operate fault-free in the processing of date and date-dependant
data before, during and after January 1, 2000, including but not
limited to accepting date input, providing date output, and performing
date calculations, comparison and sequencing;
(c) function accurately and without interruption before, during, and
after January 1, 2000, without any adverse effect on operations and
associated with the advent of the new century;
(d) store and provide output of date information in ways that are
unambiguous as to century.
The representations and warranties contained herein may not be disclaimed or
limited by operation of law.
BISYS FUND SERVICES OHIO, INC. GOVERNOR FUNDS
By BISYS Fund Services, Inc.
By_________________________________
By_________________________________
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SCHEDULE 1
ADMINISTRATIVE SERVICES
Under the Agreement, Governors shall provide the following services and maintain
the records relating thereto:
1. Review and comment on the Trust's Registration Statement, Prospectus,
Statement of Additional Information, Annual and Semi-Annual Reports to
Shareholders, Annual and Semi-Annual Form N-SAR, notices pursuant to
Rule 24f-2 and proxy materials.
2. Review and comment on certain materials to be distributed to the
Trust's Board for the Board's meetings.
3. Consulting with BISYS regarding fidelity bond and E&O/D&O insurance
coverage. BISYS shall obtain such insurance.
4. Attend shareholder and Board meetings as requested from time to time.
5. Maintain expense files and coordinate the payment of invoices.
BISYS shall provide all the other services required to be performed by the
Administrators under the Agreement.
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Dated: ________, 1998
Schedule A to the
Management and Co-Administration Agreement
among Governor Funds,
BISYS Fund Services Ohio, Inc.
and Governors Group Advisors, Inc.
dated ___________, 1998
Name of Fund Compensation* Date
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Prime Money Market, Pennsylvania Annual rate of .15% of each Fund's ___________, 1998
Municipal Bond, Established Growth, average daily net assets
Intermediate Term Income, Aggressive
Growth, U.S. Treasury Obligations
Money Market, Limited Duration
Government Securities, Emerging
Growth and International Equity Funds
Lifestyle Conservative Growth,
Lifestyle Moderate Growth, and
Lifestyle Growth Funds. None.
*All fees are computed daily and paid periodically.
BISYS FUND SERVICES OHIO, INC. GOVERNOR FUNDS
By BISYS Fund Services, Inc. By_______________________
By:____________________________
