EXHIBIT 23(H)(1)
FUND ADMINISTRATION SERVICING AGREEMENT
FUND ADMINISTRATION SERVICING AGREEMENT
THIS AGREEMENT is made and entered into as of this ____ day of
December, 1999, by and between The Legacy Funds, Inc., a Delaware business
trust (hereinafter referred to as the "Company"), and Firstar Mutual Fund
Services, LLC, a Wisconsin limited liability company (hereinafter referred to
as "Firstar").
WHEREAS, the Company is an open-end management investment company which
is registered under the Investment Company Act of 1940, as amended (the "1940
Act");
WHEREAS, the Company is authorized to create separate series, each with
its own separate investment portfolio;
WHEREAS, Firstar is in the business of providing, among other things,
fund administration services to investment companies; and
WHEREAS, the Company desires to retain Firstar to act as Administrator
for The Legacy Growth Fund and for each additional series of the Company
listed on Exhibit A attached hereto (each, a "Fund"), as may be amended from
time to time.
NOW, THEREFORE, in consideration of the mutual agreements herein made,
the Company and Firstar agree as follows:
1. APPOINTMENT OF ADMINISTRATOR
The Company hereby appoints Firstar as Administrator of the Company on
the terms and conditions set forth in this Agreement, and Firstar hereby
accepts such appointment and agrees to perform the services and duties set
forth in this Agreement in consideration of the compensation provided for
herein. In performing its duties hereunder, Firstar will comply with all
applicable requirements of the Securities Act of 1933, as amended, the
Securities Exchange Act of 1934, as amended, and the Investment Company Act
of 1940, as amended, and the applicable rules and regulations thereunder and
any laws, rules and regulations of governmental authorities having
jurisdiction and will act in conformity with the instructions and directions
of the Board of Trustees of the Company and such officers of the Company as
may be designated for such purpose by the Board of Trustees from time to time
which are timely delivered to Firstar.
2. DUTIES AND RESPONSIBILITIES OF FIRSTAR
A. General Fund Management
1. Act as liaison among all Fund service providers
2. Coordinate Board communication by:
a. Assisting Company counsel in establishing meeting
agendas
b. Preparing reports to the Board of Trustees based on
financial and administrative data
c. Evaluating independent auditors
d. Securing and monitoring fidelity bond and trustee and
officers liability coverage, and making the necessary
Securities and Exchange Commission ("SEC") filings
relating thereto
e. Preparing minutes of meetings of the Board of
Trustees (and its committees) and shareholders
3. Audits
a. Prepare appropriate schedules and assist independent
auditors
b. Provide information to the SEC and facilitate audit
process
c. Provide office facilities
4. Assist in overall operations of the Fund
5. Pay Fund expenses upon written authorization from the Company
B. Compliance
1. Regulatory Compliance
a. Monitor compliance with 1940 Act requirements,
including:
1) Asset diversification tests
2) Total return and SEC yield calculations
3) Maintenance of books and records under Rule
31a-3
4) Code of Ethics for the disinterested trustees
of the Fund (if requested by the Fund)
b. Monitor the Fund's compliance with the policies and
investment limitations of the Company as set forth in
its Prospectus and Statement of Additional Information
2. Blue Sky Compliance
a. Prepare and file with the appropriate state
securities authorities any and all required
compliance filings (including initial filings)
relating to the Company or the securities of the
Company so as to enable the Company to make a
continuous offering of its shares in all states
b. Monitor status and maintain registrations in each
state
3. SEC Registration and Reporting
a. Assist Company counsel in updating Prospectus and
Statement of Additional Information and in preparing
proxy statements
b. Prepare and file on a timely basis so as to incur the
minimum filing fee Rule 24f-2 notices and Form N-SAR
c. Prepare annual and semiannual reports
d. Coordinate the printing of publicly disseminated
Prospectuses, proxy statements and reports
e. File fidelity bond under Rule 17g-1
f. File shareholder reports under Rule 30b2-1
4. IRS Compliance
a. Monitor Company's status as a regulated investment
company under Subchapter M of the Internal Revenue
Code through review of the following:
1) Asset diversification requirements
2) Qualifying income requirements
3) Distribution requirements
4) All other applicable requirements
b. Calculate required distributions (including excise
tax distributions)
C. Financial Reporting
1. Provide financial data required by Fund's Prospectus and
Statement of Additional Information and registration statement
2. Prepare financial reports for shareholders, the Board of
Trustees, the SEC, and independent auditors
3. Supervise the Company's Custodian and Company Accountants in
the maintenance of the Company's general ledger and in the
preparation of the Fund's financial statements, including
oversight of expense accruals and payments, of the
determination of net asset value of the Company's net assets
and of the Company's shares, and of the declaration and
payment of dividends and other distributions to shareholders
D. Tax Reporting
1. Prepare for execution and file on a timely basis appropriate
federal and state tax returns and other required tax filings
and tax reports including, without limitation, Forms 1120/8610
with any necessary schedules and reports with respect to the
payment of dividends and capital gains distributions to
shareholders of the Fund
2. Prepare state income breakdowns where relevant
3. File Form 1099 Miscellaneous for payments to trustees and
other service providers
4. Monitor wash losses
5. Calculate eligible dividend income for corporate shareholders
E. Other
1. Provide monthly purchase and sales journal;
2. Supply various normal and customary Fund statistical data as
requested on an ongoing basis;
3. Prepare and file with the SEC the Fund's annual, semi-annual,
and quarterly shareholder reports;
4. Assist in the preparation of registration statements and other
filings relating to the registration of Shares;
5. Coordinate contractual relationships and communications
between the Fund and its contractual service providers;
6. Upon the approval of the Fund, assist any regulatory body in
any requested review of the Fund's books and records
maintained by Firstar;
7. With the approval of the Fund, provide information typically
supplied in the investment company industry to companies that
publish, track or report the price, performance or other
information with respect to investment companies;
8. Prepare and provide to the Board of Trustees of the Fund such
reports and other written materials and documents as may be
reasonably requested by the Board of Trustees;
9. Calculate various contractual expenses (e.g. investment
advisory and custody fees);
10. Calculate dividends and capital gains distributions, if any,
as required by the Fund and recommend the required amount of
distributions from ordinary income and capital gains to avoid
Federal income tax and Federal excise tax;
11. Prepare such quarterly, annual and semi-annual financial
statements as may be required under the 1940 Act or as may
otherwise be requested by the Fund;
12. As appropriate, compute yields, total return, expense ratios,
portfolio turnover rate, and, if required, portfolio average
dollar-weighted maturity and such other measures of
performance and statistics as may be requested by the Fund;
and
13. Perform such other duties as the Fund's Board of Trustees may
reasonably request from time to time.
3. COMPENSATION
The Company, on behalf of the Fund, agrees to pay Firstar for the
performance of the duties listed in this Agreement, the fees and
out-of-pocket expenses as set forth in the attached Exhibit A. Such fees
shall become effective and begin to accrue upon the first public offering and
sale of the shares of the Fund.
These fees may be changed from time to time, by mutual written
Agreement between the Company and Firstar.
The Company agrees to pay all fees and reimbursable expenses within ten
(10) business days following the receipt of the billing notice.
4. PERFORMANCE OF SERVICE; LIMITATION OF LIABILITY
A. Firstar shall exercise reasonable care in the performance of its duties
under this Agreement. Firstar shall not be liable for any error of judgment or
mistake of law or for any loss suffered by the Company in connection with
matters to which this Agreement relates, including losses resulting from
mechanical breakdowns or the failure of communication or power supplies beyond
Firstar's control, except a loss resulting from Firstar's refusal or failure to
comply with the terms of this Agreement or from bad faith, negligence, or
willful misconduct on its part in the performance of its duties under this
Agreement. Notwithstanding any other provision of this Agreement, the Company
shall indemnify and hold harmless Firstar from and against any and all claims,
demands, losses, expenses, and liabilities (whether with or without basis in
fact or law) of any and every nature (including reasonable attorneys' fees)
which Firstar may sustain or incur or which may be asserted against Firstar by
any person arising out of any action taken or omitted to be taken by it in
performing the services hereunder (i) except as provided in the first two
sentences of this paragraph, or (ii) in reliance upon any written or oral
instruction for a proper corporate purpose provided to Firstar by any duly
authorized officer of the Company not employed by Firstar or any of its
affiliates, such duly authorized officer to be included in a list of authorized
officers furnished to Firstar and as amended from time to time in writing by
resolution of the Board of Trustees of the Company.
Firstar shall indemnify and hold the Company, each controlling person of
the Company and their respective directors, trustees and officers (each a
"Firstar Indemnitee") harmless from and against any and all claims, demands,
losses, expenses, and liabilities (whether with or without basis in fact or law)
of any and every nature (including reasonable attorneys' fees) which such
Firstar Indemnitee may sustain or incur or which may be asserted against such
Firstar Indemnitee by any person arising out of any action taken or omitted to
be taken by Firstar as a result of Firstar's refusal or failure to comply with
the terms of this Agreement, its bad faith, negligence, or willful misconduct.
In the event of a mechanical breakdown or failure of communication or
power supplies beyond its control, Firstar shall take all reasonable steps to
minimize service interruptions for any period that such interruption continues
beyond Firstar's control. Firstar will make every reasonable effort to restore
any lost or damaged data and correct any errors resulting from such a breakdown
at the expense of Firstar. Firstar agrees that it shall, at all times, have
reasonable and tested contingency plans with appropriate parties, making
reasonable provision for emergency use of electrical data processing equipment
to the extent appropriate equipment is available. Representatives of the Company
shall be entitled to inspect Firstar's premises and operating capabilities at
any time during regular business hours of Firstar, upon reasonable notice to
Firstar.
Regardless of the above, Firstar reserves the right to reprocess and
correct administrative errors at its own expense.
The trustees and shareholders of the Company shall not be personally
liable for any of the obligations of the Fund or the Company under this
Agreement or in connection with any matter arising under or in connection with
this Agreement.
B. In order that the indemnification provisions contained in this section
shall apply, it is understood that if in any case the indemnitor may be asked to
indemnify or hold the indemnitee harmless, the indemnitor shall be fully and
promptly advised of all pertinent facts concerning the situation in question,
and it is further understood that the indemnitee will use all reasonable care to
notify the indemnitor promptly concerning any situation which presents or
appears likely to present the probability of a claim for indemnification. The
indemnitor shall have the option to defend the indemnitee against any claim
which may be the subject of this indemnification if it acknowledges its
responsibility for such claim. In the event that the indemnitor so elects, it
will so notify the indemnitee and thereupon the indemnitor shall take over
complete defense of the claim, and the indemnitee shall in such situation (i)
initiate no further legal or other expenses for which it shall seek
indemnification under this section and (ii) not confess any claim or make any
compromise in any case in which the indemnitor will be asked to indemnify the
indemnitee except with the indemnitor's prior written consent.
5. PROPRIETARY AND CONFIDENTIAL INFORMATION
Firstar agrees on behalf of itself and its directors, officers, and
employees to treat confidentially and as proprietary information of the Company
all records and other information relative to the Company and prior, present, or
potential shareholders of the Company (and clients of said shareholders), and
not to use such records and information for any purpose other than the
performance of its responsibilities and duties hereunder, except after prior
notification to and approval in writing by the Company, which approval shall not
be unreasonably withheld and may not be withheld where Firstar may be exposed to
civil or criminal contempt proceedings for failure to comply, after being
requested to divulge such information by duly constituted authorities, or when
so requested by the Company.
6. DATA NECESSARY TO PERFORM SERVICES
The Company or its agent, which may be Firstar, shall furnish to Firstar
the data necessary to perform the services described herein at times and in such
form as mutually agreed upon. Firstar shall provide to the Company's transfer
agent, fund accountant, custodian, investment adviser and distributor such
information and data produced or maintained by it under this Agreement as may be
necessary for such other persons to perform their duties and obligations under
their respective agreements with the Company and in such form as may be required
by such persons.
7. TERM OF AGREEMENT
This Agreement shall become effective as of the date hereof and, unless
sooner terminated as provided herein, shall continue automatically in effect for
successive two year periods. This Agreement may be terminated by the Company
upon giving ninety (90) days prior written notice to the other party.
8. NOTICES
Notices of any kind to be given by either party to the other party shall
be in writing and shall be duly given if mailed or delivered as follows:
Notice to Firstar shall be sent to:
Firstar Mutual Fund Services, LLC
000 Xxxx Xxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
and notice to the Company shall be sent to:
The Legacy Funds, Inc.
00 Xxxxxxxx
Xxx Xxxx, XX 00000-0000
Attn: President
or such other address of a party as may be specified by such party by written
notice hereunder.
9. DUTIES IN THE EVENT OF TERMINATION
In the event that, in connection with termination, a successor to any of
Firstar's duties or responsibilities hereunder is designated by the Company by
written notice to Firstar, Firstar will promptly, upon such termination and at
the expense of the Company, transfer to such successor all relevant books,
records, correspondence, and other data established or maintained by Firstar
under this Agreement in a form reasonably acceptable to the Company (if such
form differs from the form in which Firstar has maintained, the Company shall
pay any expenses associated with transferring the data to such form), and will
cooperate in the transfer of such duties and responsibilities, including
provision for assistance from Firstar's personnel in the establishment of books,
records, and other data by such successor.
10. GOVERNING LAW
This Agreement shall be construed and the provisions thereof
interpreted under and in accordance with the laws of the State of Wisconsin.
However, nothing herein shall be construed in a manner inconsistent with the
1940 Act or any rule or regulation promulgated by the SEC thereunder.
11. RECORDS
Firstar shall keep records relating to the services to be performed
hereunder, in the form and manner, and for such period as it may deem
advisable and is agreeable to the Company but not inconsistent with the rules
and regulations of appropriate government authorities, in particular, Section
31 of the 1940 Act and the rules thereunder. Firstar agrees that all such
records prepared or maintained by Firstar relating to the services to be
performed by Firstar hereunder are the property of the Company and will be
preserved, maintained, and made available in accordance with such section and
rules of the 1940 Act and will be promptly surrendered to the Company on and
in accordance with its request.
12. ASSIGNMENT
This Agreement may not be assigned by Firstar, nor may Firstar delegate
its duties hereunder, without the prior written consent of the Company, and
any assignment not in compliance with this Section shall be void. This
Agreement shall be binding upon and shall inure to the benefit of the parties
hereto and their respective successors and permitted assigns.
13. AMENDMENT; WAIVER
This Agreement may not be amended or changed except by a written
instrument signed by the parties hereto. No omission or delay on the part of
either party in requiring the due and punctual fulfillment by the other party
of any of its obligations hereunder shall constitute a waiver by the omitting
or delaying party of any of its rights to require such due and punctual
fulfillment of any obligation hereunder, whether similar or otherwise, or a
waiver of any remedy it may have hereunder or otherwise.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by a duly authorized officer in one or more counterparts as of the
day and year first written above.
THE LEGACY FUNDS, INC. FIRSTAR MUTUAL FUND SERVICES, LLC
By: ____________________________ By: _____________________________
Print: ____________________________ Print: _____________________________
Title: ____________________________ Title: _____________________________
Date: ____________________________ Date: _____________________________
Attest: ____________________________ Attest: _____________________________
FUND ADMINISTRATION AND COMPLIANCE
ANNUAL FEE SCHEDULE - DOMESTIC FUNDS
EXHIBIT A
Separate Series of The Legacy Funds, Inc.
NAME OF SERIES DATE ADDED
Legacy Growth Fund December __, 1999
Class A
Annual fee based upon average assets per Fund
6 basis points (.0006) on the first $200 million of average daily net assets
5 basis points (.0005) on the next $500 million of average daily net assets
3 basis points (.0003) on the balance
Minimum annual fee: $30,000 per Fund or Class
Plus out-of-pocket expense reimbursements, including, but not limited to:
Postage
Programming
Stationery
Proxies
Retention of records
Special reports
Federal and state regulatory filing fees
Certain insurance premiums
Expenses from Board of Trustees meetings
Auditing and legal expenses
Fees and out-of-pocket expense reimbursements are billed to the Fund monthly.
