FUND ADMINISTRATION SERVICING AGREEMENT
THIS AGREEMENT is made and entered into as of this
1st day of October, 1997, by and between Xxxx Funds,
Inc., a Minnesota corporation (hereinafter referred to
as the "Company") and Firstar Trust Company, a
corporation organized under the laws of the State of
Wisconsin (hereinafter referred to as "FTC").
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, FTC is a trust company and, among other
things, is in the business of providing fund
administration services for the benefit of its
customers; and
WHEREAS, the Company desires to retain FTC to act
as Administrator for the Emerging Growth Fund (the
"Fund") and for each additional series of the Company
listed on Exhibit A attached hereto, as may be amended
from time to time.
NOW, THEREFORE, the Company and FTC do mutually
promise and agree as follows:
I.Appointment of Administrator
The Company hereby appoints FTC as Administrator of the
Company on the terms and conditions set forth in
this Agreement, and FTC 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.
II.Duties and Responsibilities of FTC
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 board reports based on financial and
administrative data
c.Evaluating independent auditor
d.Securing and monitoring fidelity bond and director
and officer liability coverage, and
making the necessary SEC filings
relating thereto
e.Preparing minutes of meetings of the board and
shareholders
3.Audits
a.Prepare appropriate schedules and assist independent
auditors
b.Provide information to SEC and facilitate audit
process
c.Provide office facilities
4.Assist in overall operations of the Fund
0.Xxx 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
directors of the Fund
b.Monitor Fund's compliance with the policies and
investment limitations of the Company as
set forth in its Prospectus and
Statement of Additional Information
0.Xxxx Sky Compliance
a.Prepare and file with the appropriate state
securities authorities any and all
required compliance filings relating to
the registration of 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 and
Rule 24f-2 notices
b.Prepare annual and semiannual reports
c.Coordinate the printing of publicly disseminated
Prospectuses and reports
d.File fidelity bond under Rule 17g-1
e.File shareholder reports under Rule 30b2-1
4.IRS Compliance
a.Monitor Company's status as a regulated investment
company under Subchapter M through
review of the following:
1)Asset diversification requirements
2)Qualifying income requirements
3)Distribution requirements
b.Monitor short-short testing
c.Calculate required distributions (including excise
tax distributions)
X.Xxxxxxxxx Reporting
1.Provide financial data required by Fund's Prospectus
and Statement of Additional Information
2.Prepare financial reports for shareholders, the
board, 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
X.Xxx Reporting
1.Prepare and file on a timely basis appropriate
federal and state tax returns including
Forms 1120/8610 with any necessary
schedules
2.Prepare state income breakdowns where relevant
3.File Form 1099 Miscellaneous for payments to
directors and other service providers
4.Monitor wash losses
5.Calculate eligible dividend income for corporate
shareholders
III.Compensation
The Company, on behalf of the Fund, agrees to pay FTC
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.
These fees may be changed from time to time, subject to
mutual written Agreement between the Company and
FTC.
The Company agrees to pay all fees and reimbursable
expenses within ten (10) business days following
the receipt of the billing notice.
IV.Performance of Service; Limitation of Liability
A.FTC shall exercise reasonable care in the performance
of its duties under this Agreement. FTC 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 FTC's
control, except a loss resulting from FTC'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 FTC 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 FTC may sustain or incur or
which may be asserted against FTC by any person
arising out of any action taken or omitted to be
taken by it in performing the services hereunder
(i) in accordance with the foregoing standards, or
(ii) in reliance upon any written or oral
instruction provided to FTC by any duly authorized
officer of the Company, such duly authorized
officer to be included in a list of authorized
officers furnished to FTC and as amended from time
to time in writing by resolution of the Board of
Directors of the Company.
FTC shall indemnify and hold the Company
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 the Company may sustain or
incur or which may be asserted against the Company
by any person arising out of any action taken or
omitted to be taken by FTC as a result of FTC'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, FTC shall take all reasonable steps to
minimize service interruptions for any period that
such interruption continues beyond FTC's control.
FTC 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
FTC. FTC agrees that it shall, at all times, have
reasonable 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 FTC's premises and operating
capabilities at any time during regular business
hours of FTC, upon reasonable notice to FTC.
Regardless of the above, FTC reserves the right to
reprocess and correct administrative errors at its
own expense.
X.Xx 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.
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
initiate no further legal or other expenses for
which it shall seek indemnification under this
section. The indemnitee shall in no case 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.
V.Proprietary and Confidential Information
FTC 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 FTC 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 Company.
XX.Xxxx Necessary to Perform Services
The Company or its agent, which may be FTC, shall
furnish to FTC the data necessary to perform the
services described herein at times and in such
form as mutually agreed upon.
VII.Terms of the 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 annual periods. The Agreement may be
terminated by either party upon giving ninety (90)
days prior written notice to the other party or
such shorter period as is mutually agreed upon by
the parties.
The terms of this Agreement shall not be waived,
altered, modified, amended, or supplemented in any
manner whatsoever except by a written instrument
signed by FTC and the Company.
VIII. Duties in the Event of Termination
In the event that, in connection with termination, a
successor to any of FTC's duties or
responsibilities hereunder is designated by the
Company by written notice to FTC, FTC 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 FTC under this
Agreement in a form reasonably acceptable to the
Company (if such form differs from the form in
which FTC 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 FTC's personnel in
the establishment of books, records, and other
data by such successor.
IX.Choice of Law
This Agreement shall be construed 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.
X.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 FTC shall be sent to:
Firstar Trust Company
Attn.: Mutual Fund Services
000 Xxxx Xxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
and notice to the Company shall be sent to:
Xxxx Investment Advisors
Attn.: Xxxxxxxx X. Xxxxxxxxx, Esq.
0000 Xxxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxx, XX 00000
XI.Records
FTC 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. FTC
agrees that all such records prepared or
maintained by FTC relating to the services to be
performed by FTC 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.
IN WITNESS WHEREOF, the parties hereto have caused
this Agreement to be executed by a duly authorized
officer or one or more counterparts as of the day and
year first written above.
Xxxx Funds, Inc. FIRSTAR TRUST COMPANY
By: /s/ XxXxx X. Xxxx By: /s/ Xxx Xxxxxxxxx
------------------------- -------------------------
XxXxx X. Xxxx Xxx Xxxxxxxxx
Attest: /s/ Xxxxx X. Xxxx Attest: /s/ Xxxxx X. Xxxx
-------------------------- --------------------------
Fund Administration and Compliance
Annual Fee Schedule - Domestic Funds
Exhibit A
Separate Series of Xxxx Funds, Inc.
Name of Series Date Added
Emerging Growth Fund October 1, 1997
Class A
Class I
Annual fee based upon average net fund assets per class
6 basis points on the first $100 million
5 basis points on the next $400 million
3 basis points on the balance
Minimum annual fee: $30,000 first fund
$20,000 /fund next three funds
$15,000 /fund additional funds
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 directors meetings
Auditing and legal expenses*
* If in excess of $1,000 in any month, such
expenses must be pre-approved by the Company.
Fees and out-of-pocket expense reimbursements are
billed monthly
