ADMINISTRATION AND FUND ACCOUNTING AGREEMENT
EX
– 99(h)(1)
THIS AGREEMENT is made as of
this 28th day of June, 2006, by and between Cheswold Lane Funds, a Delaware
statutory trust (the “Trust”), and UMB Fund Services, Inc., a Wisconsin
corporation (the “Administrator”).
WHEREAS, the Trust is an
open-end investment company registered under the Investment Company Act of 1940,
as amended (the “1940 Act”) and is authorized to issue shares of beneficial
interests (the “Shares”) in separate series with each such series representing
interests in a separate portfolio of securities and other assets;
and
WHEREAS, the Trust and the
Administrator desire to enter into an agreement pursuant to which the
Administrator shall provide administration and fund accounting services to such
investment portfolios of the Trust as are listed on Schedule A hereto and any
additional investment portfolios the Trust and Administrator may agree upon and
include on Schedule A as such Schedule may be amended from time to time (such
investment portfolios and any additional investment portfolios are individually
referred to as a “Fund” and collectively the “Funds”).
NOW, THEREFORE, in
consideration of the mutual promises and agreements herein contained and other
good and valuable consideration, the receipt of which is hereby acknowledged,
the parties hereto, intending to be legally bound, do hereby agree as
follows:
1. Appointment
The Trust hereby appoints the
Administrator as administrator and fund accountant of the Funds for the period
and on the terms set forth in this Agreement. The Administrator
accepts such appointment and agrees to render the services herein set forth, for
the compensation herein provided.
2. Services as
Administrator
(a) Subject
to the direction and control of the Trust’s Board of Trustees and utilizing
information provided by the Trust and its current and prior agents and service
providers, the Administrator will provide the services listed on Schedule B
hereto. The duties of the Administrator shall be confined to those
expressly set forth therein, and no implied duties are assumed by or may be
asserted against the Administrator hereunder.
(b) The Trustees of the Trust
shall cause the officers, trustees, investment adviser(s) and sub-advisers,
legal counsel, independent accountants, transfer agent, custodian and other
service providers and agents, past or present, for the Funds to cooperate with
the Administrator and to provide the Administrator with such information,
documents and advice relating to the Funds and the Trust as necessary and/or
appropriate or as requested by the Administrator, in order to enable the
Administrator to perform its duties hereunder. In connection with its
duties hereunder, the Administrator shall (without investigation or
verification) be entitled and is hereby instructed to, rely upon any and all
instructions, advice, information or documents provided to the Administrator by
an officer or representative of the Funds or by any of the aforementioned
persons. The Administrator shall be entitled to rely on any document
that it reasonably believes to be genuine and to have been signed or presented
by the proper party. Fees charged by such
persons shall be an expense of the Trust. The Administrator shall not be
held to have notice of any change of authority of any officer, agent,
representative or employee of the Trust, investment adviser(s) or service
provider until receipt of written notice thereof from the Trust. As
used in this Agreement, the term “investment adviser” includes all sub-advisers
or persons performing similar services.
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(c) To the extent required
by Rule 31a-3 under the 1940 Act, the Administrator hereby agrees that all
records which it maintains for the Trust pursuant to its duties hereunder are
the property of the Trust and further agrees to surrender promptly to the Trust
any of such records upon the Trust’s request. Subject to the terms of
Section 6, and where applicable, the Administrator further agrees to preserve
for the periods prescribed by Rule 31a-2 under the 1940 Act the records
described in Schedule B which are maintained by the Administrator for the
Trust.
(d) It is understood that in
determining security valuations, the Administrator employs one or more pricing
services, as directed by the Trust, to determine valuations of portfolio
securities for purposes of calculating net asset values of the
Trust. The Trust shall identify to the Administrator the pricing
service(s) to be utilized on behalf of the Trust. The Administrator shall
price the securities and other holdings of the Trust for which market
quotations or prices are available by the use of such
services. For those securities where prices are not provided
by the pricing service(s) utilized by the Administrator,
the Trust shall approve, in good faith, the method for determining the fair
value of the securities. The Trust’s investment adviser shall
determine or obtain the valuation of the securities in accordance with those
procedures and shall deliver to the Administrator
the resulting prices for use in its calculation of net asset
values. The Administrator
is authorized to rely on the prices provided by such service(s) or by the
Trust’s investment adviser(s) or other authorized representative of the Trust
without investigation or verification.
(e) The
Trust’s Board of Trustees and the Funds’ investment adviser(s) have and retain
primary responsibility for all compliance matters relating to the Funds
including but not limited to compliance with the 1940 Act, the Internal Revenue
Code of 1986, as amended, the USA PATRIOT ACT of 2002, the Sarbanes Oxley Act of
2002 and the policies and limitations of each Fund relating to the portfolio
investments as set forth in the Prospectus and Statement of Additional
Information. The Administrator’s monitoring and other functions
hereunder shall not relieve the Board and the investment adviser(s) of their
primary day-to-day responsibility for assuring such compliance.
(f) The
Trust hereby certifies that each Fund is lawfully eligible for sale in each
jurisdiction indicated for such Fund on the list furnished to the Administrator
as of the date of this Agreement.
(g) The
Administrator shall maintain a disaster recovery and business continuity plan
and adequate and reliable computer and other equipment necessary and appropriate
to carry out its obligations under this Agreement. Upon the Fund’s
reasonable request, the Administrator shall provide supplemental information
concerning the aspects of its disaster recovery and business continuity plan
that are relevant to the services provided hereunder.
3. Fees; Delegation;
Expenses
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(a) In consideration of the
services rendered pursuant to this Agreement, the Trust will pay the
Administrator a fee, computed daily and payable monthly based on monthly net
assets, plus out-of-pocket expenses, each as provided in Schedule C hereto. In
addition, to the extent that the Administrator corrects, verifies or addresses
any prior actions or inactions by any Fund or by any prior service provider, the
Administrator shall be entitled to additional fees as provided in Schedule
C. Fees shall be earned and paid monthly in an amount equal to at
least 1/12th of the
applicable annual fee. Basis point fees and minimum annual fees apply
separately to each Fund, and average net assets are not aggregated in
calculating the applicable basis point fee per Fund or the applicable
minimum. Fees shall be adjusted in accordance with Schedule C or as
otherwise agreed to by the parties from time to time. The parties may amend this
Agreement to include fees for any additional services requested by the Trust,
enhancements to current services, or to add Funds for which the Administrator
has been retained. The Trust agrees to pay the Administrator’s then
current rate for additional services provided, or for enhancements to existing
services currently provided, after the execution of this
Agreement.
(b) For
the purpose of determining fees payable to the Administrator, net asset value
shall be computed in accordance with the Trust’s Prospectuses and resolutions of
the Trust's Board of Trustees. The fee for the period from the day of the month
this Agreement is entered into until the end of that month shall be pro-rated
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 pro-rated 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. Should the
Trust be liquidated, merged with or acquired by another fund or investment
company, any accrued fees shall be immediately payable.
(c) The
Administrator will bear all expenses incurred by it in connection with the
performance of its services under Section 2, except as otherwise provided
herein. The Administrator shall not be required to pay or finance any
costs and expenses incurred in the operation of the Funds, including, but not
limited to: taxes; interest; brokerage fees and commissions; salaries, fees and
expenses of officers and Trustees; Securities and Exchange
Commission (the “Commission”) fees and state Blue Sky fees; advisory
fees; charges of custodians, transfer agents, dividend disbursing and accounting
services agents and other service providers; security pricing services;
insurance premiums; outside auditing and legal expenses; costs of organization
and maintenance of corporate existence; taxes and fees payable to federal, state
and other governmental agencies; preparation, typesetting, printing, proofing
and mailing of prospectuses, statements of additional information, supplements,
notices, forms and applications and proxy materials for regulatory purposes and
for distribution to current shareholders; preparation, typesetting, printing,
proofing and mailing and other costs of shareholder reports; expenses in
connection with the electronic transmission of documents and information
including electronic filings with the Commission and the states; research and
statistical data services; expenses incidental to holding meetings of the Fund’s
shareholders and Trustees; fees and expenses associated with internet, e-mail
and other related activities; and extraordinary expenses. Expenses
incurred for distribution of shares, including the typesetting, printing,
proofing and mailing of prospectuses for persons who are not shareholders of the
Trust, will be borne by the Funds’ investment adviser, except for such expenses
permitted to be paid by the Trust under a distribution plan adopted in
accordance with applicable laws. The Administrator shall not be
required to pay any Blue Sky fees or take any related Blue Sky actions unless
and until it has received the amount of such fees from the Trust.
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(d) Except
as otherwise specified, fees payable hereunder shall be calculated in arrears
and billed on a monthly basis. The Trust agrees to pay all fees
within thirty days of receipt of each invoice. The Administrator
retains the right to charge interest in the amount of 1-1/2 percent per month on
any amounts that remain unpaid beyond such thirty day period.
4. Proprietary and Confidential
Information
The Administrator agrees on behalf of
itself and its employees to treat confidentially and as proprietary information
of the Trust all records relative to the Funds’ shareholders, not to use such
records and information for any purpose other than performance of its
responsibilities and duties hereunder, and not to disclose such information
except where the Administrator may be exposed to civil or criminal proceedings
for failure to comply, when requested to divulge such information by duly
constituted authorities or court process, when subject to governmental or
regulatory audit or investigation, or when so requested by the Trust. In case of
any requests or demands for inspection of the records of the Funds, the
Administrator will endeavor to notify the Trust promptly and to secure
instructions from a representative of the Trust as to such inspection. Records
and information which have become known to the public through no wrongful act of
the Administrator or any of its employees, agents or representatives, and
information which was already in the possession of the Administrator prior to
the date hereof, shall not be subject to this paragraph.
5. Limitation of
Liability
(a) The Administrator
shall not be liable for any error of judgment or mistake of law or for any loss
suffered by the Funds in connection with the matters to which this Agreement
relates, except for a loss resulting from the Administrator’s willful
misfeasance, bad faith or negligence in the performance of its duties or from
reckless disregard by it of its obligations and duties under this
Agreement. Furthermore, the Administrator shall not be liable for (i)
any action taken or omitted to be taken in accordance with or in reliance upon
written or oral instructions, advice, data, documents or information (without
investigation or verification) received by the Administrator from an officer or
representative of the Trust, or from a representative of any of the parties
referenced in Section 2, (ii) its reliance on the security valuations
without investigation or verification provided by pricing service(s), the
Trust’s investment adviser(s) or representatives of the Trust, or (iii) any
action taken or omission by a Fund, the Trust, investment adviser(s) or any past
or current service provider.
(b) The
Administrator assumes no responsibility hereunder, and shall not be liable, for
any default, damage, loss of data or documents, errors, delay or any other loss
whatsoever caused by events beyond its reasonable control. The
Administrator will, however, take all reasonable steps to minimize service
interruptions for any period that such interruption continues beyond its
control.
(c) The Trust agrees to
indemnify and hold harmless the Administrator, its employees, agents, officers,
directors, affiliates and nominees (collectively, the “Indemnified Parties”)
from and against any and all claims, demands, actions and suits, and from and
against any and all judgments, liabilities, losses, damages, costs, charges,
reasonable counsel fees and other expenses of every nature and character which
may be asserted against or incurred by any Indemnified Party or for which any
Indemnified Party may be held liable (a “Claim”) arising out of or in any way
relating to (i) the Administrator’s actions or omissions except to the extent a
Claim resulted from the Administrator’s willful misfeasance, bad faith, or
negligence in the performance of its duties hereunder or from reckless disregard
by it of its obligations and duties hereunder; (ii) the Administrator’s reliance
on, implementation of or use of (without investigation or verification) advice,
instructions, requests, directions, information, data, records and documents
received by the Administrator from any party referenced in Section 2 hereof or
other representative of the Trust, or (iii) any action taken by or omission of
the Trust, investment adviser(s) or any past or current service
provider.
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(d) In no event and under no
circumstances shall the Administrator, its affiliates or any of its or their
officers, directors, members, agents or employees be liable to anyone,
including, without limitation, the other party, under any theory of tort,
contract, strict liability or other legal or equitable theory for lost profits,
exemplary, punitive, special, indirect or consequential damages for any act or
failure to act under any provision of this Agreement regardless of whether such
damages were foreseeable and even if advised of the possibility
thereof. The indemnity and defense provisions set forth in this
Section 5 shall indefinitely survive the termination and/or assignment of this
Agreement.
6. Term
(a) This Agreement shall
become effective with respect to each Fund listed on Schedule A hereof as of the
date this Agreement is executed and, with respect to each Fund not in existence
on that date, on the date an amendment to Schedule A to this Agreement relating
to that Fund is executed. This Agreement shall continue in effect
with respect to each Fund until terminated as provided
herein. Either party may terminate this Agreement at any time by
giving the other party a written notice not less than sixty (60) days prior
to the date the termination is to be effective.
(b) The terms of this
Agreement shall not be waived, altered, modified, amended or supplemented in any
manner whatsoever except by a written instrument signed by the Administrator and
the Trust.
(c) Notwithstanding
anything herein to the contrary, upon the termination of the Agreement as
provided herein or the liquidation of a Fund or the Trust, UMBFS, upon the
written request of the Trust, shall deliver the records of the Trust to the
Trust or its successor administrator and fund accountant in a form that is
consistent with UMBFS’ applicable license agreements at the expense of the
Trust, and thereafter the Trust or its designee shall be solely responsible for
preserving the records for the periods required by all applicable laws, rules
and regulations. The Trust shall be responsible for all expenses associated with
the movement (or duplication) of records and materials and conversion thereof to
a successor fund accounting and administrative services agent, including all
reasonable trailing expenses incurred by the Administrator. In
addition, in the event of termination of this Agreement, or the proposed
liquidation or merger of the Trust or a Fund(s), and the Trust requests the
Administrator to provide additional services in connection therewith, the
Administrator shall provide such services and be entitled to such compensation
as the parties may mutually agree.
(d) Notwithstanding
any other provision of this Agreement, in the event of an agreement to enter
into a transaction that would result in a Change of Control, as hereinafter
defined, of the Trust’s investment adviser or sponsor, the Trust’s ability to
terminate this Agreement pursuant to this Section 6 shall be suspended from the
time of such agreement until eighteen months after the Change of
Control. For purposes of this Agreement, a “Change of Control” of the
investment adviser or sponsor means a change in ownership or control of more
than fifty percent (50%) of the common stock or shares of beneficial interest of
such investment adviser or sponsor or its parent company.
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7. Non-Exclusivity
The services of the Administrator
rendered to the Trust are not deemed to be exclusive. The
Administrator may render such services and any other services to others,
including other investment companies. The Trust recognizes that from
time to time directors, officers and employees of the Administrator may serve as
trustees, directors, officers and employees of other entities (including other
investment companies), and that the Administrator or its affiliates may enter
into other agreements with such other entities.
8. Governing Law;
Invalidity
This Agreement shall be governed by
Wisconsin law, excluding the laws on conflicts of laws. To the extent
that the applicable laws of the State of Wisconsin, or any of the provisions
herein, conflict with the applicable provisions of the 1940 Act, the latter
shall control, and nothing herein shall be construed in a manner inconsistent
with the 1940 Act or any rule or order of the Commission
thereunder. Any provision of this Agreement which may be determined
by competent authority to be prohibited or unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective to the extent of such prohibition
or unenforceability without invalidating the remaining provisions hereof, and
any such prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other
jurisdiction. In such case, the parties shall in good faith modify or
substitute such provision consistent with the original intent of the
parties.
9. Notices
Any notice required or permitted to be
given by either party to the other shall be in writing and shall be deemed to
have been given when sent by registered or certified mail, postage prepaid,
return receipt requested, as follows: Notice to the Administrator
shall be sent to UMB Fund Services, Inc., 000 Xxxx Xxxxxxxx Xxxxxx, Xxxxx X,
Xxxxxxxxx, XX, 00000, Attention: Xxxxx X. Xxxxxxx, with a copy to General
Counsel, and notice to the Trust shall be sent to Cheswold Lane Funds, Xxx Xxxxx
Xxxxxx, Xxxxx 000, 000 Xxxxx Xxxxxx, Xxxx Xxxxxxxxxxxx, XX, 00000,
Attention: President.
10. Entire
Agreement
This Agreement, together with the
Schedules attached hereto, constitutes the entire Agreement of the parties
hereto.
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11. Trust
Limitations
This Agreement is executed by the Trust
with respect to each of the Funds and the obligations hereunder are not binding
upon any of the Trustees, officers or shareholders of the Trust individually but
are binding only upon the Fund to which such obligations pertain and the assets
and property of such Fund. All obligations of the Trust under this
Agreement shall apply only on a Fund-by-Fund basis, and the assets of one Fund
shall not be liable for the obligations of another Fund. The Fund’s
Declaration of Trust is on file with the Secretary of State of
Delaware.
12.
Miscellaneous
(a) This
Agreement may be executed in any number of counterparts, each of which shall be
deemed to be an original agreement but such counterparts shall together
constitute but one and the same instrument. The facsimile signature of any party
to this Agreement shall constitute the valid and binding execution hereof by
such party.
(b) The
Trust hereby grants to the Administrator the limited power of attorney on behalf
of the Funds to sign Blue Sky forms and related documents in connection with the
performance of its obligations under this Agreement.
IN WITNESS WHEREOF, the
parties hereto have caused this Agreement to be executed by a duly authorized
officer as of the day and year first above written.
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(the
“Trust”)
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By:
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/s/ Xxxx Xxxxxxx
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President
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UMB
FUND SERVICES, INC.
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(“Administrator”)
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By:
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/s/ Xxxxx Xxxxxxx
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Executive
Vice
President
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Schedule
A
to
the
by
and between
and
UMB
Fund Services, Inc.
Name of
Funds
Cheswold
Lane International High Dividend Fund
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Schedule
B
to
the
by
and between
and
UMB
Fund Services, Inc.
SERVICES
Subject
to the direction and control of the Trust’s Board of Trustees and utilizing
information provided by the Trust and its agents, the Administrator
will:
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§
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provide
office space, facilities, equipment and personnel to carry out its
services hereunder;
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§
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compile
data for and prepare with respect to the Funds timely Notices to the
Commission required pursuant to Rule 24f-2 under the 1940 Act and
Semi-Annual Reports on Form N-SAR;
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§
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prepare
and review the financial statement for the Funds’ Annual and Semi-Annual
Reports included in Form N-CSR as required under the Xxxxxxxx-Xxxxx Act;
assist in compiling exhibits and disclosures for Form N-CSR as requested
by the Adviser;
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§
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assist
in the preparation for execution by the Trust and file all federal income
and excise tax returns and state income tax returns (and such other
required tax filings as may be agreed to by the parties) other than those
required to be made by the Trust’s custodian or transfer agent, subject to
the review and approval of the Trust and the Trust’s independent
accountants;
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§
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prepare
the financial statements for the Annual and Semi-Annual Reports required
pursuant to Section 30(d) under the 1940 Act, subject to the review and
approval of the Trust and the Trust’s independent
accountants;
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§
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provide
financial and Fund performance information for inclusion in
the Registration Statement for the Trust (on Form N-1A or any
replacement therefor) and any amendments thereto, subject to the review of
Trust counsel;
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§
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determine
and periodically monitor each Fund’s income and expense accruals and cause
all appropriate expenses to be paid from Trust assets on proper
authorization from the Trust;
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§
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calculate
income factors and daily net asset values of each Fund (i) in accordance
with the Trust’s operating documents as provided to the Administrator, and
(ii) based on security valuations provided by the Trust, the Trust’s
investment adviser, and pricing service(s), as provided
herein;
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9
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§
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maintain
all general ledger accounts and related
subledgers;
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assist
in the acquisition of the Trust’s fidelity bond required by the 1940 Act,
monitor the amount of the bond and make the necessary Commission filings
related thereto;
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§
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from
time to time as the Administrator deems appropriate, check each Fund’s
compliance with the policies and limitations of each Fund relating to the
portfolio investments as set forth in the Prospectus and Statement of
Additional Information and monitor each Fund’s status as a regulated
investment company under Subchapter M of the Internal Revenue Code of
1986, as amended (but these functions shall not relieve the Trust’s
investment adviser and sub-advisers, if any, of their primary day-to-day
responsibility for assuring such
compliance);
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§
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maintain,
and/or coordinate with the other service providers the maintenance of, the
accounts, books and other documents required pursuant to Rule 31a-1(a) and
(b) under the 1940 Act;
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§
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prepare
and file state securities qualification/notice compliance filings, with
the advice of the Trust’s legal counsel, upon and in accordance with
instructions from the Trust, which instructions will include the states to
qualify in, the amounts of Shares to initially and subsequently qualify
and the warning threshold to be
maintained;
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develop
with legal counsel and the secretary of the Trust an agenda for each board
meeting and, if requested by the Trustees, attend board meetings and
prepare minutes;
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§
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prepare
Form 1099s for Trustees and other fund
vendors;
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calculate
dividend and capital gains distributions subject to review and
approval by the Trust and its independent accountants;
and
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§
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generally
assist in the Trust’s administrative operations as mutually agreed to by
the parties.
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The
duties of the Administrator shall be confined to those expressly set forth
herein, and no implied duties are assumed by or may be asserted against the
Administrator hereunder. These services do not include correcting,
verifying or addressing any prior actions or inactions by any Fund or by any
prior service provider. To the extent the Administrator agrees to
take such actions, those actions taken shall be deemed part of the Schedule
B.
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Schedule
C
to
the
by
and between
and
UMB
Fund Services, Inc.
Fees
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