EXHIBIT 99.B(h)(1)
ADMINISTRATION AGREEMENT
Xxxxx Fargo Variable Trust
000 Xxxxxx Xxxxxx
Xxxxxx Xxxx, Xxxxxxxx 00000
THIS AGREEMENT is made as of this ___ day of September, 1999, by and
between Xxxxx Fargo Variable Trust, a Delaware business trust (the "Trust") and
Xxxxx Fargo Bank, N.A., a national banking association ("Xxxxx Fargo").
WHEREAS, the Trust is registered as an open-end management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act");
and
WHEREAS, the Trust desires to retain Xxxxx Fargo to render certain
administrative services to the Trust's investment portfolios listed on Appendix
A (individually, a "Fund" and collectively, the "Funds"), and Xxxxx Fargo is
willing to render such services.
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, the parties agree as follows:
1. Appointment. The Trust hereby appoints Xxxxx Fargo to act as
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Administrator of the Funds, and Xxxxx Fargo hereby accepts such appointment and
agrees to render such services and duties set forth in Paragraph 3, for the
compensation and on the terms herein provided. Each new investment portfolio
established in the future by the Trust shall automatically become a "Fund" for
all purposes hereunder as if it were listed on Appendix A, absent written
notification to the contrary by either the Trust or Xxxxx Fargo.
2. Delivery of Documents. The Trust shall furnish to, or cause to be
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furnished to, Xxxxx Fargo originals of, or copies of, all books, records, and
other documents and papers related in any way to the administration of the
Trust.
3. Duties as Administrator. Xxxxx Fargo shall, at its expense, provide
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the following administrative services in connection with the operations of the
Trust and the Funds:
(a) receive and tabulate shareholder votes;
(b) furnish statistical and research data;
(c) coordinate (or assist in) the preparation and filing with the U.S.
Securities and Exchange Commission ("SEC") of registration
statements, notices, shareholder reports, and other material
required to be filed under applicable laws;
(d) prepare and file with the states registration statements, notices,
reports, and other material required to be filed under applicable laws;
(e) prepare and file Form 24F-2s and N-SARs;
(f) review bills submitted to the Funds and, upon determining that a
xxxx is appropriate, allocating amounts to the appropriate Funds and Classes
thereof and instructing the Funds' custodian to pay such bills;
(g) coordinate (or assist in) the preparation of reports and other
information materials regarding the Funds including proxies and other
shareholder communications, and review prospectuses;
(h) prepare expense table information for annual updates;
(i) provide legal and regulatory advice to the Funds in connection
with its other administrative functions, including assignment of matters to
outside legal counsel on behalf of the Trust and supervising the work of such
counsel;
(j) provide office facilities and clerical support for the Funds;
(k) develop and implement procedures for monitoring compliance with
regulatory requirements and compliance with the Funds' investment objectives,
policies and restrictions;
(l) serve as liaison between the Funds and their independent
auditors;
(m) prepare and file tax returns;
(n) review payments of Fund expenses;
(o) prepare expense budgeting and accruals;
(p) provide communication, coordination, and supervision services with
regard to the Funds' transfer agent, custodian, fund accountant, any co-
administrators, and other service organizations that render recordkeeping or
shareholder communication services;
(q) provide information to the Funds' distributor concerning fund
performance and administration;
(r) assist the Trust in the development of additional investment
portfolios;
(s) provide reports to the Funds' board of directors regarding
its activities;
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(t) assist in the preparation and assembly of meeting materials,
including comparable fee information, as required, for the Funds' board of
directors; and
(u) provide any other administrative services reasonably necessary for
the operation of the Funds other than those services that are to be provided by
the Trust's transfer and dividend disbursing agent, custodian, and fund
accountant, provided that nothing in this Agreement shall be deemed to require
Xxxxx Fargo to provide any services that may not be provided by it under
applicable banking laws and regulations.
In performing all services under this Agreement, Xxxxx Fargo shall:
(a) act in conformity with the Trust's Declaration of Trust (and By-Laws, if
any), the 1940 Act, and any other applicable laws as may be amended from time to
time, and with the Trust's registration statement under the Securities Act of
1933 and the 1940 Act, as may be amended from time to time; (b) consult and
coordinate with legal counsel to the Trust as necessary and appropriate; and (c)
advise and report to the Trust and its legal counsel, as necessary and
appropriate, with respect to any compliance or other matters that come to its
attention.
In connection with its duties under this Paragraph, Xxxxx Fargo may,
at its own expense, enter into sub-administration agreements with other service
providers, provided that each such service provider agrees with Xxxxx Fargo to
comply with this Agreement and all relevant provisions of the 1940 Act, the
Investment Advisers Act of 1940, any other applicable laws as may be amended
from time to time, and all relevant rules thereunder. Xxxxx Fargo will provide
the Trust with a copy of each sub-administration agreement it executes relating
to the Trust. Xxxxx Fargo will be liable for acts or omissions of any such sub-
administrators under the standards of care described herein under Paragraph 5.
4. Compensation. In consideration of the administration services to
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be rendered by Xxxxx Fargo under this Agreement, the Trust shall pay Xxxxx Fargo
a monthly fee, as shown on Appendix A, of the average daily value (as determined
on each business day at the time set forth in the Prospectus for determining net
asset value per share) of the Funds' net assets during the preceding month. If
the fee payable to Xxxxx Fargo pursuant to this Paragraph begins to accrue
before the end of any month or if this Agreement terminates before the end of
any month, the fee for the period from the effective date to the end of that
month or from the beginning of that month to the termination date, respectively,
shall be prorated according to the proportion that the period bears to the full
month in which the effectiveness or termination occurs. For purposes of
calculating each such monthly fee, the value of each Fund's net assets shall be
computed in the manner specified in that Fund's registration statement as then
on file with the SEC for the computation of the value of the Fund's net assets
in connection with the determination of the net asset value of Fund shares. For
purposes of this Agreement, a "business day" is any day that the Trust is open
for trading.
5. Limitation of Liability; Indemnification.
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(a) Xxxxx Fargo shall not be liable for any error of judgment or
mistake of law or for any loss suffered by the Trust in connection with the
performance of its obligations and
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duties under this Agreement, except a loss resulting from Xxxxx Fargo's willful
misfeasance, bad faith, or negligence in the performance of its obligations and
duties or that of its agents or sub-administrators, or by reason of its or their
reckless disregard thereof. Any person, even though also an officer, director,
employee or agent of Xxxxx Fargo, shall be deemed, when rendering services to
the Trust or acting on any business of the Trust (other than services or
business in connection with Xxxxx Fargo's duties as Administrator hereunder), to
be acting solely for the Trust and not as an officer, director, employee, or
agent or one under the control or discretion of Xxxxx Fargo even though paid by
it.
(b) The Trust, on behalf of each Fund, will indemnify Xxxxx Fargo
against and hold it harmless from any and all losses, claims, damages,
liabilities, or expenses (including reasonable counsel fees and expenses)
resulting from any claim, demand, action, or suit relating to the particular
Fund and not resulting from willful misfeasance, bad faith, or negligence of
Xxxxx Fargo or its agents or sub-administrators in the performance of their
obligations and duties, or by reason of its or their reckless disregard thereof.
Xxxxx Fargo will not confess any claim or settle or make any compromise in any
instance in which the Trust will be asked to provide indemnification, except
with the Trust's prior written consent. Any amounts payable by the Trust under
this Subparagraph shall be satisfied only against the assets of the Fund
involved in the claim, demand, action, or suit and not against the assets of any
other Fund.
(c) Xxxxx Fargo will indemnify the Trust against and hold it harmless
from any and all losses, claims, damages, liabilities, or expenses (including
reasonable counsel fees and expenses) resulting from any claim, demand, action,
or suit against the Trust or any Fund that resulted from a failure of Xxxxx
Fargo or its agents to act in accordance with the standard of care set forth in
Subparagraph (a) above; provided that such loss, claim, damage, liability or
expense did not result primarily from willful misfeasance, bad faith, or
negligence of the Trust or its agents (other than Xxxxx Fargo or agents of Xxxxx
Fargo) in the performance of their obligations and duties, or by reason of its
or their reckless disregard thereof. The Trust will not confess any claim or
settle or make any compromise in any instance in which Xxxxx Fargo will be asked
to provide indemnification, except with Xxxxx Fargo's prior written consent.
6. Allocation of Expenses. Xxxxx Fargo assumes and shall pay for
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maintaining the staff and personnel necessary to perform its obligations under
this Agreement and shall, at its own expense, provide its own office space,
facilities and equipment. In addition to the fees described in Section 4 of
this Agreement, the Trust (or its other service providers, as may be provided
pursuant to their respective agreements and contracts with the Trust) shall pay
all of its expenses which are not expressly assumed by Xxxxx Fargo hereunder.
The expenses of legal counsel and accounting experts retained by Xxxxx Fargo,
after consulting with the Trust's legal counsel and independent auditors, as may
be reasonably necessary or appropriate for the performance by Xxxxx Fargo of its
duties under this Agreement shall be deemed to be expenses of, and shall be paid
for by, the Trust.
7. Amendments. This Agreement may be amended at any time by mutual
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agreement in writing of the Trust and Xxxxx Fargo, provided that the Board of
Trustees of the Trust,
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including a majority of the trustees who are not interested persons of the Trust
or any party to this Agreement, as defined by the 1940 Act, approves any such
amendment in advance.
8. Administrator's Other Businesses. Except to the extent necessary
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to perform Xxxxx Fargo's obligations under this Agreement, nothing herein shall
be deemed to limit or restrict the right of Xxxxx Fargo, or any affiliate or
employee of Xxxxx Fargo, to engage in any other business or to devote time and
attention to the management or other aspects of any other business, whether of a
similar or dissimilar nature, or to render services of any kind to any other
corporation, firm, individual or association.
9. Duration. This Agreement shall become effective on its execution
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date and shall remain in full force and effect for one year or until terminated
pursuant to the provisions in Paragraph 10, and it may be reapproved at least
annually by the Board of Trustees, including a majority of the directors who are
not interested persons of the Trust or any party to this Agreement, as defined
by the 1940 Act.
10. Termination of Agreement. This Agreement may be terminated at any
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time, without the payment of any penalty, by a vote of a majority of the members
of the Trust's Board of Trustees, on 60 days' written notice to Xxxxx Fargo; or
by Xxxxx Fargo on 60 days' written notice to the Trust.
11. Expense Waivers. If in any fiscal year the total expenses of a
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Fund incurred by, or allocated to, the Fund, excluding taxes, interest,
brokerage commissions and other portfolio transaction expenses, other
expenditures that are capitalized in accordance with generally accepted
accounting principles, extraordinary expenses and amounts accrued or paid under
a Rule 12b-1 Plan of the Fund and including only the fees provided for in
Paragraph 4 and those provided for pursuant to the Fund's advisory agreement
("includible expenses"), exceed the applicable voluntary expense waivers, if
any, set forth in the Prospectus, Xxxxx Fargo shall waive or reimburse that
portion of the excess derived by multiplying the excess by a fraction, the
numerator of which shall be the percentage at which the fee payable pursuant to
this Agreement is calculated under Paragraph 4, and the denominator of which
shall be the sum of such percentage plus the percentage at which the fee payable
pursuant to the Fund's advisory agreement is calculated (the "Applicable
Ratio"), but only to the extent of the fee hereunder for the fiscal year. If
the fees payable under this Agreement and/or the Fund's advisory agreement
contributing to such excess portion are calculated at more than one percentage
rate, the Applicable Ratio shall be calculated separately for and applied
separately to the portions of excess attributable to, the period to which a
particular percentage rate applied. At the end of each month of the Trust's
fiscal year, the Trust shall review the includible expenses accrued during that
fiscal year to the end of that period and shall estimate the includible expenses
for the balance of that fiscal year. If as a result of that review and
estimation it appears likely that the includible expenses will exceed the
limitations referred to in this Paragraph for a fiscal year with respect to the
Fund, the monthly fee set forth in Paragraph 4 payable to Xxxxx Fargo for such
month shall be reduced, subject to a later adjustment, by an amount equal to the
Applicable Ratio times the estimated excess pro rated over the remaining months
of the fiscal year (including the month just
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ended). For purposes of computing the excess, if any, the value of the Fund's
net assets shall be computed in the manner specified in Paragraph 4, and any
reimbursements required to be made by Xxxxx Fargo shall be made once a year
promptly after the end of the Trust's fiscal year.
12. Trust not bound to violate its Articles. Nothing in this
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Agreement shall require the Trust to take any action contrary to any provision
of its Declaration of Trust or to any applicable statute or regulation.
13. Miscellaneous.
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(a) Any notice or other instrument authorized or required by
this Agreement to be given in writing to the Trust or Xxxxx Fargo shall be
sufficiently given if addressed to that party and received by it at its office
set forth below or at such other place as it may from time to time designate in
writing.
To the Trust:
Xxxxx Fargo Variable Trust
000 Xxxxxx Xxxxxx
Xxxxxx Xxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx, Xx.
To Xxxxx Fargo:
Xxxxx Fargo Bank, N.A.
000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx
(b) This Agreement shall extend to and be binding upon the
parties hereto and their respective successors and assigns; provided, however,
that this Agreement shall not be subject to assignment (as that term is defined
under the 0000 Xxx) without the written consent of the other party.
(c) This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware.
(d) This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, and which
collectively shall be deemed to constitute only one agreement.
(e) The captions of this Agreement are included for
convenience of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect.
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(f) If any provision of this Agreement is declared to be ;prohibited
or unenforceable, the remaining provisions of this Agreement shall continue to
be valid and fully enforceable.
In witness whereof, the parties have caused this Agreement to be
executed by their duly authorized officers as of the day and year first above
written.
XXXXX FARGO VARIABLE TRUST
By:____________________________
Xxxxxxx X. Xxxxx, Xx.
Secretary
XXXXX FARGO BANK, N.A.
By:____________________________
Xxxxxxx X. Xxxxx
Senior Vice President
By:____________________________
C. Xxxxx Xxxxxxx
Vice President
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Appendix A
Funds of Xxxxx Fargo Variable Trust Covered by This Agreement
Fee of 0.15% of average daily
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net assets on an annual basis:
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1. Asset Allocation Fund
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2. Corporate Bond Fund
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3. Equity Value Fund
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4. Growth Fund
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5. Income Equity Fund
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6. International Equity Fund
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7. Large Company Growth Fund
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8. Money Market Fund
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9. Small Cap Fund
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Approved by Board of Trustees: March 26, 1999
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