Exhibit h(4)
ADMINISTRATION AGREEMENT
As of April 29, 2002
ALPS Mutual Funds Services, Inc.
000 Xxxxxxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxx, Xxxxxxxx 00000
Dear Sirs:
The Lipper Funds, Inc., a Maryland corporation ("the "Fund"), and ALPS
Mutual Funds Services, Inc. ("ALPS") agree as follows:
The Fund is an open-end management investment company registered under the
Investment Company Act of 1940, as amended, presently consisting of the
portfolios ("Portfolio" or "Portfolios") and share classes listed in Appendix A
attached hereto.
The Fund desires to employ its capital by investing and reinvesting the
same in investments of the type and in accordance with the limitations specified
in its Prospectuses and Statement of Additional Information as from time to time
in effect, copies of which have been or will be submitted to ALPS, and
resolutions of the Fund's Board of Directors. The Fund desires to employ ALPS as
its administrator for the Portfolios.
1. Duties of the Administrator
ALPS agrees to provide the Fund the services listed in Appendix B attached
hereto.
2. Fees; Delegation; Expenses
For the services provided to the Fund pursuant to this Agreement, the Fund
shall pay ALPS the fees listed on Appendix C attached hereto.
ALPS will from time to time employ or associate itself with such person or
persons or organizations as ALPS may believe to be desirable in the performance
of its duties. Such person or persons may be officers and employees who are
employed by both ALPS and the Fund. The compensation of such person or persons
or organizations shall be paid by ALPS and no obligation shall be incurred on
behalf of the Fund in such respect.
ALPS will bear all expenses in connection with the performance of its
services under this Agreement and all related agreements, except as otherwise
provided herein. ALPS will not bear any of the costs of Fund personnel. Other
expenses incurred shall be borne by the
Fund, including, but not limited to, transfer agency and custodial expenses;
taxes; interest; Directors' fees; brokerage fees and commissions; state
registration fees; advisory fees; insurance premiums; fidelity bond premiums;
Fund and advisory related legal expenses; costs of maintenance of Fund
existence; printing and delivery of materials in connection with meetings of the
Directors; and SEC registration fees.
3. Proprietary and Confidential Information
ALPS agrees on behalf of itself and its officers, directors, employees and
ALPS, to treat confidentially and as proprietary information of the Fund all
records and other information relative to the Fund and its 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 Fund, which approval shall not be unreasonably
withheld and may not be withheld where ALPS may be exposed to civil, regulatory
or criminal proceedings for failure to comply, when requested to divulge such
information by duly constituted authorities, or when so requested by the Fund.
4. Limitation of Liability
ALPS shall not be liable for any error of judgment or mistake of law or for
any loss suffered by the Fund 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.
5. Term
This Agreement shall become effective as of April 29, 2002 and, unless
sooner terminated as provided herein, shall continue until April 30, 2004 (the
"Initial Term"). During the Initial Term, this Agreement may be terminated,
without penalty, solely by agreement of the parties on not less than sixty days
written notice. After the Initial Term, this Agreement may be terminated without
cause and without penalty by the Fund or by ALPS, on not less than ninety days
written notice to the other party. The Fund may immediately terminate this
Agreement for cause as defined below.
Termination for "cause" shall mean:
(i) willful misfeasance, bad faith, gross negligence or reckless
disregard on the part of ALPS with respect to its obligations and duties
hereunder;
(ii) regulatory, administrative, or judicial proceedings against ALPS
which result in a determination that it has violated any rule, regulation,
order, or law and which in the reasonable judgment of the Directors,
including a majority of the Directors who are not interested persons (as
defined in the 0000 Xxx) of any party to this Agreement, which
substantially impairs the performances of ALPS' obligations and duties
hereunder;
(iii) financial difficulties on the part of ALPS 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 Stated 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.
6. Representations and Warranties of ALPS. ALPS represents and warrants to the
Fund that:
(a) It is duly organized and existing as a corporation and in good
standing under the laws of the State of Colorado.
(b) It is empowered under applicable laws and by its Charter and By-laws
to enter into and perform this Agreement.
(c) All requisite corporate proceedings have been taken to authorize it to
enter into and perform this Agreement.
(d) It has and will continue to have access to the necessary facilities,
equipment and personnel to perform its duties and obligations under
this Agreement in accordance with industry standards.
(e) It will provide the Fund with all information necessary to complete
its filing requirements in a timely fashion.
7. Governing Law
This Agreement shall be governed by the laws of the State of New York to
the extent federal law does not govern.
8. Other Provisions
The Fund recognizes that from time to time directors, officers and
employees of ALPS may serve as directors, officers and employees of other
corporations or businesses (including other investment companies) and that such
other corporations and funds may include ALPS as part of their name and that
ALPS or its affiliates may enter into administration or other agreements with
such other corporations and funds.
ALPS further acknowledges and agrees that the liabilities, obligations and
expenses incurred hereunder with respect to a particular Portfolio shall be
enforceable against the assets and property of such Portfolio only, and not
against the assets or property of the other Portfolio or any other series of the
Fund.
If the Fund establishes one or more additional series with respect to which
it wishes to retain ALPS to serve as administrator hereunder, it will notify
ALPS in writing. If ALPS is willing to render such services under this
Agreement, it will so notify the Fund in writing, whereupon such series will
become a "Portfolio" as defined hereunder and will be subject to the provisions
of this Agreement to the same extent as the Fund is named above, except to the
extent that such provisions are modified with respect to such new Portfolio in
writing by the Fund and ALPS.
If the foregoing is in accordance with your understanding, will you kindly so
indicate by signing and returning to us the enclosed copy hereof.
Accepted:
ALPS MUTUAL FUNDS SERVICES, INC.
By: /s/ XXXXXX X. XXXXX
---------------------------------------
Name: Xxxxxx X. Xxxxx
Title: President
THE LIPPER FUNDS, INC.
By: /s/ XXXXXXX XXXXXXXX
---------------------------------------
Name: Xxxxxxx Xxxxxxxx
Title: Executive Vice President
Appendix A
The Lipper Funds, Inc.
Lipper High Income Bond Fund
Premier Shares
Retail Shares
Group Retirement Plan Shares
Lipper Prime Europe Equity Fund
Premier Shares
Retail Shares
Group Retirement Plan Shares
Lipper U.S. Equity Fund
Premier Shares
Retail Shares
Group Retirement Plan Shares
Lipper Mergers Fund
Premier Shares
Retail Shares
Group Retirement Plan Shares
Appendix B
Duties of Administrator
o Assist the Fund in monitoring each Portfolio's compliance with:
(i) the investment restrictions described in the Fund's registration
statement
(ii) SEC diversification requirements, as applicable
(iii) its status as a regulated investment company under Sub-chapter M
of the Internal Revenue Code of 1986, as amended
o Prepare and file with the SEC on behalf of the Fund:
(i) Form N-SAR
(ii) Form 24f-2
(iii) Shareholder reports pursuant to Rule 30(b)2
(iv) Fidelity bond pursuant to Rule 17g-1
o Provide financial information for, and generally review as requested by the
Fund, proxies, annual and semi-annual reports, Prospectuses, Statement of
Additional Information and registration statements.
o Administer the Fund's Code of Ethics (including compilation of securities
transaction reports from the Fund's Directors and Officers) and generally
assist in monitoring compliance with such Code of Ethics.
o Monitor the Fund's state registration requirements by:
(i) downloading daily purchase information from the transfer agent
(ii) reviewing daily compliance reports
(iii) filing annual renewals and coordinating payment of registration
fees
(iv) assisting the Fund in evaluating state registration budget
o Provide assistance to the Fund related to quarterly Board of Directors
meetings including:
(i) Prepare and distribute draft of meeting minutes
(ii) Prepare and distribute draft of meeting agenda
(iii) Prepare board reports regarding services provided by ALPS, as
requested by the Fund
(iv) Coordinate compilation, printing and distribution of board
materials
o Furnish officers of the Fund, as requested.
o Assist the Fund with placement of fidelity bond and errors and omissions
insurance policies
o Prepare the Fund's semi-annual financial statements including schedules of
investments and the related statements of operations, assets and
liabilities and, changes in net assets, as well as the financial highlights
and footnotes to the financial statements.
o Provide facilities, information and personnel, as necessary, to
accommodate annual audits with the Fund's independent accountants, or
examinations conducted by the Securities and Exchange Commission.
o Monitor the Fund's expense accruals by establishing expense budgets and
comparing expense accruals on a periodic basis to actual expenses paid.
o Report performance and other portfolio information to outside reporting
agencies as directed by the Fund.
o Calculate monthly performance including total return and SEC yield
calculations.
o Calculate dividends in accordance with the policies detailed in the Fund's
registration statement.
o Provide tax services to the Fund including:
(i) Prepare and file Federal tax returns on Form 1120-RIC
(ii) Prepare and file necessary state tax returns
(iii) Prepare and file Federal Excise tax return on Form 8613
(iv) Calculate year-end capital gain distributions
(v) Prepare and file required 1099-MISC, as required
(vi) Provide financial information for year-end tax-letter sent to
shareholders
Appendix C
Fees
----
Base Fee
--------
Greater of $260,000 minimum annual fee or the following percentages of
total trust Assets:
10 basis points $0-$500 million
7.5 basis points $500 million-$1 billion
5 basis points over $1 billion
Out-of-pocket expenses
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Securities pricing
Travel expenses for one person per board meeting
