ADMINISTRATION AGREEMENT
Agreement made this 11th day of February, 1998, between Xxxxxx
Funds, Inc., a Maryland Corporation currently consisting of the Xxxxxx Value
Fund (hereinafter referred to as the "Fund") and Xxxxxx Investment
Advisors LLC, a New Jersey Limited Liability Company (the "Administrator").
W I T N E S S E T H:
WHEREAS, the Fund is in the process of registering with the
Securities and Exchange Commission under the Investment Company Act of
1940 (the "Act") as an open-end investment company; and
WHEREAS, the Fund desires to retain the Administrator to be
the Administrator for the Fund and as such to perform the services set
forth in this Agreement.
NOW, THEREFORE, the Fund and the Administrator do mutually
promise and agree as follows:
1. Employment. The Fund hereby employs the Administrator
to be the Administrator for the Fund for the period and on the terms set
forth in this Agreement. The Administrator hereby accepts such employment
for the compensation herein provided and agrees during such period to
render the services and to assume the obligations herein set forth.
2. Authority and Duties of the Administrator. The
Administrator shall supervise all aspects of the operations of the Fund
except those performed by the Fund's investment adviser under the Fund's
investment advisory agreement, subject to such policies as the board of
directors of the Company may determine. The Administrator shall for all
purposes herein be deemed to be an independent contractor and shall,
unless otherwise expressly provided or authorized, have no authority to
act for or represent the Fund in any way or otherwise be deemed
to be an agent of the Fund. However, one or more shareholders,
officers, directors or employees of the Administrator may
serve as directors and/or officers of the Fund, but without
compensation or reimbursement of expenses for such services from the
Fund. Nothing herein contained shall be deemed to require the Fund
to take any action contrary to its Articles of Incorporation or any
applicable statute or regulation, or to relieve or deprive the board of
directors of the Fund of its responsibility for and control of the
affairs of the Fund.
In connection with its supervision of the operations of the
Fund, the Administrator shall perform the following services for the Fund:
(a) Prepare and maintain the books, accounts and other
documents specified in Rule 31a-1, under the Act in accordance with
the requirements of Rule 31a-1 and Rule 31a-2 under the Act;
(b) Calculate the Fund's net asset value in accordance with the
provisions of the Fund's Articles of Incorporation and By-Laws and
its Registration Statement;
(c) Respond to stockholder inquiries forwarded to it by the
Fund:
(d) Prepare the financial statements contained in reports to
stockholders of the Fund:
(e) Prepare for execution by the Fund and file all of the
Fund's federal and state tax returns;
(f) Prepare reports to and filings with the Securities and
Exchange Commission;
(g) Prepare reports to and filings with state Blue Sky
authorities;
(h) Furnish statistical and research data, clerical, accounting
and bookkeeping services and stationery and office supplies; and
(i) Keep and maintain the Fund's financial accounts and
records, and generally assist in all aspects of the Fund's operations
to the extent agreed to by the Administrator and the Fund.
3. Expenses. The Administrator, at its own expense and
without reimbursement from the Fund, shall furnish office
space, and all necessary office facilities, equipment and executive
personnel for performing the services required to be performed by it under
the Agreement. The Administrator shall not be required to pay any
expenses of the Fund. The expenses of the Fund's operations borne by the
Fund include by way of illustration and not limitation, directors fees
paid to those directors who are not officers of the Company, the
professional costs of preparing and the costs of printing its registration
statements required under the Securities Act of 1933 and the Act (and
amendments thereto), the expense of registering its shares with the
Securities and Exchange Commission and in the various states, the printing
and distribution cost of prospectuses mailed to existing shareholders, the
cost of stock certificates (if any), director and officer liability
insurance, the printing and distribution and distribution costs of reports
to stockholders, reports to government authorities and proxy statements,
interest charges, taxes, legal expenses, association membership dues,
auditing services, insurance premiums, brokerage and other expenses
connected with the execution of portfolio securities transactions, fees
and expenses of the custodian of the Fund's assets, printing and mailing
expenses and charges and expenses of dividend disbursing agents,
registrars and stock transfer agents.
4. Compensation of the Administrator. For the services to be
rendered by the Administrator hereunder, the Fund shall pay to the
Administrator an administration fee, paid monthly, based on the average net
assets of the Fund, as determined by valuations made as of the close of each
business day of the month. The administration fee shall be 1/12 of 0.1%
(0.1% Annually) of such average net assets up to and including $30,000,000,
and 1/12 of 0.05% (0.05% annually) of such average net assets of the Company
in excess of $30,000,000; provided, however, that for any month in which this
Agreement is not in effect for the entire month, such fee shall be reduced
proportionately on the basis of the number of calendar days during which it
is in effect and the fee computed upon the daily net assets of the business
days during which it is so in effect.
It is understood that the Administrator will not receive any compensation
for services provided until June 30, 1999.
5. Exclusivity. The services of the Administrator to the Fund
hereunder are not to be deemed exclusive and the Administrator shall be
free to furnish similar services to others as long as the services
hereunder are not impaired thereby. During the period that this Agreement
is in effect, the Administrator shall be the Fund's sole administrator.
6. Liability. In the absence of willful misfeasance, bad
faith, gross negligence or reckless disregard of obligations or duties
hereunder on the part of the Administrator, the Administrator shall not be
subject to liability to the Fund or to any shareholder of the Fund for any
act or omission in the course of, or connected with, rendering services
hereunder, or for any losses that may be sustained in the purchase,
holding or sale of any security.
7. Amendments. This Agreement may be amended by the mutual
consent of the parties; provided, however, that in no event may it be
amended without the approval of the board of directors of the Fund in
the manner required by the Act.
8. Termination. This Agreement may be terminated at any time,
without the payment of any penalty, by the board of directors of the
Company or by a vote of the majority of the outstanding voting securities
of the Company as defined in the Act, upon the giving of sixty (60) days'
written notice to the Administrator. This Agreement may be terminated by
the Administrator at any time upon the giving of sixty (60) days' written
notice to the Company. This Agreement shall terminate automatically in
the event of its assignment (as defined in Section 2(a)(4) of the Act).
Subject to prior termination as hereinbefore provided, the Agreement shall
continue in effect for two (2) years from the date hereof and indefinitely
thereafter, but only so long as the continuance after such two (2) year
period is specifically approved annually by (i) the board of directors of
the Company. Upon termination of the Agreement the Administrator shall
deliver to the Company all books, accounts and other documents then
maintained by it pursuant to Section 2 hereof.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed on the day first above written.
Xxxxxx Funds, Inc. Xxxxxx Investment Advisors LLC
(Fund) (Administrator)
By: /s/ Xxxxxxx X Xxxxxx By: /s/ Xxxxxxx X Xxxxxx
(President) (President)
Attest: /s/ Xxxxx X Xxxxxxx
(Secretary)
