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EXHIBIT (9)(a)
ADMINISTRATION AGREEMENT
CONESTOGA FAMILY OF FUNDS
THIS AGREEMENT is made as of this 1st day of May 1995, by and between the
Conestoga Family of Funds (the "Trust"), a Massachusetts business trust, and
SEI Financial Management Corporation (the "Administrator"), a Delaware
corporation.
WHEREAS, the Trust is an open-end management investment company
registered under the Investment Company Act of 1940, as amended (the "1940
Act"), consisting of several series of shares; and
WHEREAS, the Trust desires the Administrator to provide, and the
Administrator is willing to provide, management, shareholder services and
administrative services to such portfolios of the Trust as the Trust and the
Administrator may agree on (the "Portfolios") and as listed on the schedules
attached hereto (the "Schedules") and made a part of this Agreement, on the
terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the covenants
hereinafter contained, the Trust and the Administrator hereby agree as follows:
ARTICLE 1. Retention of the Administrator. The Trust hereby
retains the Administrator to act as the administrator of the Portfolios and to
furnish the Portfolios with the management and administrative services as set
forth below. The Administrator hereby accepts such employment to perform the
duties set forth below.
The Administrator shall, for all purposes herein, be deemed to be an
independent contractor and, unless otherwise expressly provided or authorized,
shall have no authority to act for or represent the Trust in any way and shall
not be deemed an agent of the Trust.
ARTICLE 2. Other Administrative Services. The Administrator shall
perform or supervise the performance by others of administrative services in
connection with the operations of the Portfolios, and, on behalf of the Trust,
will investigate, assist in the selection of and conduct relations with
custodians, depositories, accountants, legal counsel, underwriters, brokers and
dealers, corporate fiduciaries, insurers, banks and persons in any other
capacity deemed to be necessary or desirable for the Portfolios' operations.
The Administrator shall provide the Trustees of the Trust with such reports
regarding investment performance as they may reasonably request but shall have
no responsibility for supervising the performance by any investment adviser or
sub-adviser of its responsibilities.
The Administrator shall provide the Trust with regulatory reporting
and blue sky filings, fund accounting and related portfolio accounting
services, all necessary office space, equipment (including back-up facilities
in the event of equipment or systems failure), personnel compensation and
facilities (excluding facilities for Shareholders' and Trustees' meetings held
outside Pennsylvania) for handling
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the affairs of the Portfolios and such other services as the Administrator
shall, from time to time, determine to be necessary to perform its obligations
under this Agreement. In addition, at the request of the Board of Trustees, the
Administrator shall make reports to the Trust's Trustees concerning the
performance of its obligations hereunder.
Without limiting the generality of the foregoing, the Administrator shall:
(a) calculate contractual Trust expenses and control all
disbursements for the Trust, and as appropriate compute the
Trust's yields, total return, expense ratios, portfolio
turnover rate and, if required, portfolio average
dollar-weighed maturity;
(b) assist Trust counsel with the preparation of prospectuses,
statements of additional information, registration statements,
proxy materials;
(c) prepare such reports, applications and documents (including
reports regarding the sale and redemption of Shares as may be
required in order to comply with Federal and state securities
law) as may be necessary or desirable to register the Trust's
shares with state securities authorities and file with the
appropriate state securities authorities the registration
statements and reports for the Trust and the Trust's shares
and all amendments thereto, as may be necessary or convenient
to register and keep effective the Trust and the Trust's
shares with state securities authorities to enable the Trust
to make a continuous offering of its shares;
(d) develop and prepare communications to shareholders, including
the annual report to shareholders, coordinate mailing
prospectuses, notices, proxy statements, proxies and other
reports to Trust shareholders, and supervise and facilitate
the solicitation of proxies solicited by the Trust for all
shareholder meetings, including tabulation process for
shareholder meetings;
(e) administer contracts on behalf of the Trust with, among
others, the Trust's investment adviser, distributor,
custodian, and transfer agent;
(f) maintain the Trust's general ledger and prepare the Trust's
financial statements, including expense accruals and payments,
and on each business day determine the net asset value and per
share offering price of the Trust's assets and of the Trust's
shares;
(g) prepare and file the Trust's federal and state tax returns;
(h) assist with the layout and printing of publicly disseminated
prospectuses and assist with and coordinate layout and
printing of the Trust's semi-annual and annual reports to
shareholders;
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(i) provide internal legal and administrative services as
reasonably requested by the Trust from time to time;
(j) assist with the design, development, and operation of the
Trust, including new portfolio and class investment
objectives, policies and structure;
(k) provide individuals reasonably acceptable to the Trust's Board
of Trustees for nomination, appointment, or election as
officers of the Trust, who will be responsible for the
management of certain of the Trust's affairs as determined by
the Trust's Board of Trustees;
(l) advise the Trust and its Board of Trustees on matters
concerning the Trust and its affairs;
(m) obtain and keep in effect fidelity bonds and Trustees and
officers/errors and omissions insurance policies for the Trust
in accordance with the requirements of Rules 17g-1 and
17d-1(7) under the 1940 Act as such bonds and policies are
approved by the Trust's Board of Trustees;
(n) monitor and advise the Trust and its Portfolios on their
registered investment company status under the Internal
Revenue Code of 1986, as amended;
(o) perform all administrative services and functions of the Trust
and each Portfolio to the extent administrative services and
functions are not provided to the Trust or such Portfolio
pursuant to the Trust's or such Portfolio's investment
advisory agreement, distribution agreement, custodian
agreement and transfer agent agreement;
(p) prepare and file with the SEC the semi-annual report for the
Trust on Form N-SAR and all required notices pursuant to Rule
24f-2;
(q) calculate and pay dividends and capital gain distributions to
be paid to each Portfolio's shareholders in conformity with
subchapter M of the Internal Revenue Code;
(r) pay all expenses payable by the Company;
(s) prepare such reports relating to the business and affairs of
the Portfolio (not otherwise appropriately prepared by the
Trust's investment adviser, counsel or auditors) as the
Trustees of the Trust may from time to time reasonably request
in connection with performance of their duties;
(t) provide reviews and quarterly compliance reports to the
Trustees regarding all applicable regulatory and operating
requirements;
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(u) mail the annual reports of the Portfolios; prepare an annual
list of shareholders; and mail notices of shareholders'
meetings, proxies and proxy statements, for all of which the
Trust will pay the Administrator's out-of-pocket expenses;
(v) answer such correspondence and inquiries from Shareholders,
securities brokers and others relating to its duties hereunder
and such other correspondence and inquiries as may from time
to time on such terms as may be mutually agreed upon between
the Administrator and the Trust;
(w) regarding foreign investments:
(1) Regulatory Compliance.
(A) Obtain the Custodian's 17f-5 package for the Trust's Board
regarding sub-custodian and selected countries for investment.
(B) Coordinate Board approval of selected countries and subsequent
completion of sub-custodial documents.
(2) Financial Reporting.
(A) Monitor and review tax reclaims chronologically, by country
and type; report on same to Trust management.
a. File/complete tax withholding documents, as supplied by
the custodian.
(B) Monitor procedures for timely and accurate pricing.
(C) Review and monitor treatment of currency gain/loss and capital
gain/loss.
a. Section 988 transactions.
b. Section 1256 contracts.
(3) Tax Reporting.
(A) Determine tax treatment of foreign investments and their impact on
a. Subchapter M tests-- e.g. diversification, qualified
income, 30% tests.
b. Taxable income and capital gains.
(B) Calculate distributions to shareholders.
a. Monitor character and impact of realized currency
gain/loss on distribution amount.
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(C) Calculate income and expenses by country in order to determine
foreign tax credit available to shareholders.
Also, the Administrator will perform other services for the Trust as agreed
from time to time at the request of the Board of Trustees, including, but not
limited to performing internal audit examinations.
ARTICLE 3. Allocation of Charges and Expenses.
(A) The Administrator. The Administrator shall furnish at its own
expense the executive, supervisory and clerical personnel necessary to perform
its obligations under this Agreement. The Administrator shall also provide the
items which it is obligated to provide under this Agreement, and shall pay all
compensation, if any, of officers of the Trust as well as all Trustees of the
Trust who are affiliated persons of the Administrator or any affiliated
corporation of the Administrator; provided, however, that unless otherwise
specifically provided, the Administrator shall not be obligated to pay the
compensation of any employee of the Trust retained by the Trustees of the Trust
to perform services on behalf of the Trust.
(B) The Trust. The Trust assumes and shall pay or cause to be paid
all other expenses of the Trust not otherwise allocated herein, including,
without limitation, organizational costs, taxes, expenses for outside legal and
auditing services, the expenses of preparing (including typesetting), printing
and mailing reports, prospectuses, statements of additional information, proxy
solicitation material and notices to existing Shareholders, all expenses
incurred in connection with issuing and redeeming Shares, the cost of custodial
services, the cost of pricing services, the cost of initial and ongoing
registration of the Shares under Federal and state securities laws, fees and
out-of-pocket expenses of Trustees who are not affiliated persons of the
Administrator or the investment adviser to the Trust or any affiliated
corporation of the Administrator or the investment adviser, insurance,
interest, brokerage costs, litigation and other extraordinary or nonrecurring
expenses, and all fees and charges of investment advisers to the Trust.
ARTICLE 4. Compensation of the Administrator.
(A) Administration Fee. For the services to be rendered, the
facilities furnished and the expenses assumed by the Administrator pursuant to
this Agreement, the Trust shall pay to the Administrator compensation at an
annual rate specified in the Schedules. Such compensation shall be calculated
and accrued daily, and paid to the Administrator monthly. The Trust shall also
reimburse the Administrator for its reasonable out of pocket expenses.
If this Agreement becomes effective subsequent to the first day of a
month or terminates before the last day of a month, the Administrator's
compensation for that part of the month in which this Agreement is in effect
shall be prorated in a manner consistent with the calculation of the fees as
set forth above. Payment of the Administrator's compensation for the preceding
month shall be made promptly.
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(B) Compensation from Transactions. The Trust hereby authorizes any
entity or person associated with the Administrator which is a member of a
national securities exchange to effect any transaction on the exchange for the
account of the Trust which is permitted by Section 11 (a) of the Securities
Exchange Act of 1934 and Rule 11a2-2(T) thereunder, and the Trust hereby
consents to the retention of compensation for such transactions in accordance
with Rule 11a2-2(T) (a) (2) (iv).
(C) Survival of Compensation Rates. All rights of compensation under
this Agreement for services performed as of the termination date shall survive
the termination of this Agreement.
ARTICLE 5. Limitation of Liability of the Administrator. 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. The Administrator shall not be liable for any error of
judgment or mistake of law or for any loss arising out of any investment or for
any act or omission in carrying out its duties hereunder, except a loss
resulting from willful misfeasance, bad faith or gross negligence in the
performance of its duties, or by reason of reckless disregard of its
obligations and duties hereunder, except as may otherwise be provided under
provisions of applicable law which cannot be waived or modified hereby. (As
used in this Article 5, the term "Administrator" shall include directors,
officers, employees and other corporate agents of the Administrator as well as
that corporation itself.)
The Administrator may apply to the Trust at any time for instructions
and may consult counsel for the Trust 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 action taken or omitted by it in good faith in accordance
with such instruction or with the written opinion of such counsel, accountants
or other experts.
Also, the Administrator shall be protected in acting upon any document
which it reasonably believes to be genuine and to have been signed or presented
by the proper person or persons. Nor shall the Administrator be held to have
notice of any change of authority of any officers, employee or agent of the
Trust until receipt of written notice thereof from the Trust.
ARTICLE 6. Activities of the Administrator. The services of the
Administrator rendered to the Trust are not to be deemed to be exclusive. The
Administrator is free to render such services to others and to have other
businesses and interests so long as its services hereunder are not hindered
thereby. It is understood that Trustees, officers, employees and Shareholders
of the Trust are or may be or become interested in the Administrator, as
directors, officers, employees and shareholders or otherwise and that
directors, officers, employees and shareholders of the Administrator and its
counsel are or may be or become similarly interested in the Trust, and that the
Administrator may be or become interested in the Trust as a Shareholder or
otherwise.
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ARTICLE 7. Duration of this Agreement.This Agreement shall
remain in effect for three years after the date of the Agreement. Thereafter,
if not terminated, this Agreement shall continue in effect for successive
periods of two years each, provided, that each such continuance is specifically
approved (a) by the vote of a majority of those members of the Company's Board
of Trustees who are not parties to this Agreement or interested persons of any
party to this Agreement, cast in person at a meeting called for the purpose of
voting on such approval, and (b) by the vote of a majority of the Company's
Board of Trustees, and provided further, that the failure to obtain specific
approval of continuance as aforesaid shall cause this Agreement to terminate 90
days after the end of the initial three-year period or the last two-year period
which was specifically approved as aforesaid.
Notwithstanding the foregoing, in the event of a material breach of
this Agreement by either party, the non-breaching party shall notify the
breaching party in writing of such breach and upon receipt of such notice, the
breaching party shall have 45 days to remedy the breach or the non-breaching
party may terminate this Agreement immediately.
If either party terminates this Agreement other than in accordance
with the foregoing, such party shall forthwith pay the other party such damages
for breach of this Agreement as are provided by law.
This Agreement shall not be assignable by either party without the
written consent of the other party and neither party will delegate its
responsibilities to any other person without the written approval of the other
party.
ARTICLE 8. Amendments. This Agreement may be amended by the parties
hereto only if such amendment is specifically approved (i) by the vote of a
majority of the Trustees of the Trust, and (ii) by the vote of a majority of
the Trustees of the Trust who are not parties to this Agreement or interested
persons of any such party, cast in person at a Board of Trustees meeting called
for the purpose of voting on such approval.
For special cases, the parties hereto may amend such procedures set
forth herein as may be appropriate or practical under the circumstances, and
the Administrator may conclusively assume that any special procedure which has
been approved by the Trust does not conflict with or violate any requirements
of its Declaration of Trust, By-Laws or then current prospectuses, or any rule,
regulation or requirement of any regulatory body.
ARTICLE 9. Trustees' Liability. The names "Conestoga Family of Funds"
and "Trustees of Conestoga Family of Funds" refer respectively to the Trust
created and the Trustees, as trustees but not individually or personally,
acting from time to time under a Declaration of Trust dated August 1, 1989
which is hereby referred to and a copy of which is on file at the office of the
State Secretary of the Commonwealth of Massachusetts and at the principal
office of the Trust. The obligations of "Conestoga Family of Funds" entered
into in the name or on behalf thereof by any of the Trustees, represenatives or
agents are made not individually, but in such capacities, and are not binding
upon any
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of the Trustees, Shareholders, represenatives of the Trust personally, but bind
only the Trust Property, and all persons dealing with any class of shares of
the Trust must look solely to the Trust Property belonging to such class for
the enforcement of any claims against the Trust.
ARTICLE 10. Certain Records. The Administrator shall maintain
customary records in connection with its duties as specified in this Agreement.
Any records required to be maintained and preserved pursuant to Rules 31a-1 and
31a-2 under the 1940 Act which are prepared or maintained by the Administrator
on behalf of the Trust shall be prepared and maintained at the expense of the
Administrator, but shall be the property of the Trust and will be made
available to or surrendered promptly to the Trust on request.
The Administrator agrees on behalf of itself and its directors,
officers, employees, and agents to treat confidentially and as proprietary
information of the Trust all non-public records and other non-public
information relative to the Trust and prior, present or potential Shareholders
of the Trust (and clients of said 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.
The Administrator shall not be required to obtain the prior approval of the
Trust to disclose proprietary information in connection with a regulatory
examination or audit.
ARTICLE 11. Definitions of Certain Terms. The terms "assignment",
"interested person" and "affiliated person," when used in this Agreement, shall
have the respective meanings specified in the 1940 Act and the rules and
regulations thereunder, subject to such exemptions as may be granted by the
Securities and Exchange Commission.
ARTICLE 12. Notice. Any notice required or permitted to be given by
either party to the other shall be deemed sufficient if sent by registered or
certified mail, postage prepaid, addressed by the party giving notice to the
other party at the last address furnished by the other party to the party
giving notice: if to the Trust, to Xxxxxx X. Xxxxxx, 0000 Xxxxx Xxxxx, Xxxxxxx,
XX 00000 with a copy to Meridian Investment Company, 00 Xxxxxx Xxxxxx Xxxxxxx,
Xxxxxxx, XX 00000, Attention, President, and if to the Administrator at 000
Xxxx Xxxxxxxxxx Xxxx, Xxxxx, XX 00000-0000.
ARTICLE 13. Governing Law. This Agreement shall be construed in
accordance with the laws of the Commonwealth of Massachusetts and the
applicable provisions of the 1940 Act. To the extent that the applicable laws
of the Commonwealth of Massachusetts, or any of the provisions herein, conflict
with the applicable provisions of the 1940 Act, the latter shall control.
ARTICLE 14. Multiple Originals. This Agreement may be executed in
two or more counterparts, each of which when so executed shall be deemed to be
an original, but such counterparts shall together constitute but one and the
same instrument.
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IN WITNESS WHEREOF, the parties hereto have executed and delivered
this Agreement as of the day and year first above written.
CONESTOGA FAMILY OF FUNDS
By: [SIG]
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Attest: [SIG]
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SEI FINANCIAL MANAGEMENT CORPORATION
By: [SIG]
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Attest: [SIG]
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SCHEDULE
TO THE ADMINISTRATION AGREEMENT
DATED MAY 1, 1995
BETWEEN
CONESTOGA FAMILY OF FUNDS
AND
SEI FINANCIAL MANAGEMENT CORPORATION
Fees: Pursuant to Article 4, Section A, the Trust shall pay the
Administrator compensation for services rendered to the
Conestoga Cash Management, Tax-Free, U.S. Treasury Securities,
Equity, International Equity, Special Equity, Bond,
Intermediate Income, Pennsylvania Tax-Free Bond, Short-Term
Income and Balanced Funds (the "Portfolios") at an annual rate
of .17% of the average daily net assets of each Portfolio,
which is calculated daily and paid monthly. All subsequent
portfolios will be subject to a minimum annual fee of $60,000
(domestic portfolios) and $80,000 (international portfolios).
An additional minimum fee of $15,000 for each class of shares
in excess of two classes will be imposed on all current and
future portfolios.
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