Exhibit 99.(k)(iii)
Exhibit (k)(iii) - administration
ADMINISTRATION AGREEMENT
AGREEMENT made as of _______________, by and between each entity listed on
Exhibit A hereto (each, a "Fund"; collectively, the "Funds"), and The Bank of
New York, a New York banking organization (the "Administrator").
W I T N E S S E T H :
WHEREAS, each Fund is an investment company registered under the Investment
Company Act of 1940, as amended (the "1940 Act"); and
WHEREAS, each Fund desires to retain the Administrator to provide administration
services for the portfolios identified on Exhibit A hereto (each, a "Series")
and the Administrator is willing to provide such services, all as more fully set
forth below;
NOW THEREFORE, in consideration of the mutual promises and agreements contained
herein, the parties hereby agree as follows:
APPOINTMENT.
Each Fund hereby appoints the Administrator as its agent for the term of this
Agreement to perform the services described herein. The Administrator hereby
accepts such appointment and agrees to perform the duties hereinafter set forth.
REPRESENTATIONS AND WARRANTIES.
Each Fund hereby represents and warrants to the Administrator, which
representations and warranties shall be deemed to be continuing, that:
It is duly organized and existing under the laws of the jurisdiction of its
organization, with full power to carry on its business as now conducted, to
enter into this Agreement and to perform its obligations hereunder;
This Agreement has been duly authorized, executed and delivered by the Fund in
accordance with all requisite action and constitutes a valid and legally binding
obligation of the Fund, enforceable in accordance with its terms; and
It is conducting its business in compliance with all applicable laws and
regulations, both state and federal, and has obtained all regulatory licenses,
approvals and consents necessary to carry on its business as now conducted;
there is no statute, regulation, rule, order or judgment binding on it and no
provision of its charter or by-laws, nor of any mortgage, indenture, credit
agreement or other contract binding on it or affecting its property which would
prohibit its execution or performance of this Agreement.
DELIVERY OF DOCUMENTS.
Each Fund will promptly deliver to the Administrator true and correct copies of
each of the following documents as currently in effect and will promptly deliver
to it all future amendments and supplements thereto, if any:
The Fund's articles of incorporation or other organizational document and all
amendments thereto (the "Charter");
The Fund's bylaws (the "Bylaws");
Resolutions of the Fund's board of directors or other governing body (the
"Board") authorizing the execution, delivery and performance of this Agreement
by the Fund;
The Fund's registration statement most recently filed with the Securities and
Exchange Commission (the "SEC") relating to the shares of the Fund (the
"Registration Statement");
The Fund's Notification of Registration under the 1940 Act on Form N-8A filed
with the SEC; and
The Fund's Prospectus and Statement of Additional Information pertaining to the
Series (collectively, the "Prospectus").
Each copy of the Charter shall be certified by the Secretary of State (or other
appropriate official) of the state of organization, and if the Charter is
required by law also to be filed with a county or other officer or official
body, a certificate of such filing shall be filed with a certified copy
submitted to the Administrator. Each copy of the Bylaws, Registration Statement
and Prospectus, and all amendments thereto, and copies of Board resolutions,
shall be certified by the Secretary or an Assistant Secretary of the appropriate
Fund.
It shall be the sole responsibility of each Fund to deliver to the Administrator
its currently effective Prospectus and the Administrator shall not be deemed to
have notice of any information contained in such Prospectus until it is actually
received by the Administrator.
DUTIES AND OBLIGATIONS OF THE ADMINISTRATOR.
Subject to the direction and control of each Fund's Board and the provisions of
this Agreement, the Administrator shall provide to each Fund the administrative
services set forth on Schedule I attached hereto.
In performing hereunder, the Administrator shall provide, at its expense, office
space, facilities, equipment and personnel.
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The Administrator shall not provide any services relating to the management,
investment advisory or sub-advisory functions of any Fund, distribution of
shares of any Fund, maintenance of any Fund's financial records or other
services normally performed by the Funds' respective counsel or independent
auditors.
Upon receipt of a Fund's prior written consent (which shall not be unreasonably
withheld), the Administrator may delegate any of its duties and obligations
hereunder to any delegee or agent whenever and on such terms and conditions as
it deems necessary or appropriate. Notwithstanding the foregoing, no Fund
consent shall be required for any such delegation to any other subsidiary of The
Bank of New York Company, Inc. The Administrator shall not be liable to any Fund
for any loss or damage arising out of, or in connection with, the actions or
omissions to act of any delegee or agent utilized hereunder so long as the
Administrator acts in good faith and without negligence or willful misconduct in
the selection of such delegee or agent.
Each Fund shall cause its officers, advisors, sponsor, legal counsel,
independent accountants, current administrator (if any) and transfer agent to
cooperate with the Administrator and to provide the Administrator, upon its
written request, with such information, documents and advice relating to such
Fund as is within the possession or knowledge of such persons, in order to
enable the Administrator to perform its duties hereunder. In connection with its
duties hereunder, the Administrator shall be entitled to rely, and shall be held
harmless by each Fund when acting in reliance, upon the instructions, advice or
any documents relating to such Fund provided to the Administrator by any of the
aforementioned persons. The Administrator shall not be liable for any loss,
damage or expense resulting from or arising out of the failure of the Fund to
cause any information, documents or advice to be provided to the Administrator
upon its written request as provided herein. All fees or costs charged by such
persons shall be borne by the appropriate Fund.
Nothing in this Agreement shall limit or restrict the Administrator, any
affiliate of the Administrator or any officer or employee thereof from acting as
administrator for or with any third parties.
The Administrator may apply to an officer of any Fund for written instructions
with respect to any matter arising in connection with the Administrator's
performance hereunder for such Fund, and the Administrator shall not be liable
for any action taken or omitted to be taken by it in good faith in accordance
with such instructions. Such application for instructions may, at the option of
the Administrator, set forth in writing any action proposed to be taken or
omitted to be taken by the Administrator with respect to its duties or
obligations under this Agreement and the date on and/or after which such action
shall be taken, and the Administrator shall not be liable for any action taken
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or omitted to be taken in accordance with a proposal included in any such
application on or after the date specified therein unless, prior to taking or
omitting to take any such action, the Administrator has received written
instructions in response to such application specifying the action to be taken
or omitted. The Administrator may consult with counsel to the appropriate Fund
or its own counsel, at such Fund's expense, and shall be fully protected with
respect to anything done or omitted by it in good faith in accordance with the
advice or opinion of such counsel.
Notwithstanding any other provision contained in this Agreement or any Schedule
hereto, the Administrator shall have no duty or obligation to with respect to,
including, without limitation, any duty or obligation to determine, or advise or
notify any Fund of: (i) the taxable nature of any distribution or amount
received or deemed received by, or payable to, a Fund, (ii) the taxable nature
or effect on a Fund or its shareholders of any corporate actions, class actions,
tax reclaims, tax refunds or similar events, (iii) the taxable nature or taxable
amount of any distribution or dividend paid, payable or deemed paid, by a Fund
to it shareholders; or (iv) the effect under any federal, state, or foreign
income tax laws of a Fund making or not making any distribution or dividend
payment, or any election with respect thereto.
The Administrator shall have no duties or responsibilities whatsoever except
such duties and responsibilities as are specifically set forth in this Agreement
and Schedule I hereto, and no covenant or obligation shall be implied against
the Administrator in connection with this Agreement.
ALLOCATION OF EXPENSES.
Except as otherwise provided herein, all costs and expenses arising or incurred
in connection with the performance of this Agreement shall be paid by the
appropriate Fund, including but not limited to, organizational costs and costs
of maintaining corporate existence, taxes, interest, brokerage fees and
commissions, insurance premiums, compensation and expenses of such Fund's
trustees, directors, officers or employees, legal, accounting and audit
expenses, management, advisory, sub-advisory, administration and shareholder
servicing fees, charges of custodians, transfer and dividend disbursing agents,
expenses (including clerical expenses) incident to the issuance, redemption or
repurchase of Fund shares, fees and expenses incident to the registration or
qualification under federal or state securities laws of the Fund or its shares,
costs (including printing and mailing costs) of preparing and distributing
Prospectuses, reports, notices and proxy material to such Fund's shareholders,
all expenses incidental to holding meetings of such Fund's trustees, directors
and shareholders, and extraordinary expenses as may arise, including litigation
affecting such Fund and legal obligations relating thereto for which the Fund
may have to indemnify its trustees, directors and officers.
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STANDARD OF CARE; INDEMNIFICATION.
Except as otherwise provided herein, the Administrator shall not be liable for
any costs, expenses, damages, liabilities or claims (including attorneys' and
accountants' fees) incurred by a Fund, except those costs, expenses, damages,
liabilities or claims arising out of the Administrator's own bad faith, gross
negligence or willful misconduct. In no event shall the Administrator be liable
to any Fund or any third party for special, indirect or consequential damages,
or lost profits or loss of business, arising under or in connection with this
Agreement, even if previously informed of the possibility of such damages and
regardless of the form of action.
Each Fund shall indemnify and hold harmless the Administrator from and against
any and all costs, expenses, damages, liabilities and claims (including claims
asserted by a Fund), and reasonable attorneys' and accountants' fees relating
thereto, which are sustained or incurred or which may be asserted against the
Administrator, by reason of or as a result of any action taken or omitted to be
taken by the Administrator in good faith hereunder or in reliance upon (i) any
law, act or regulation or official interpretation of the same even though the
same may thereafter have been altered, changed, amended or repealed, (ii) such
Fund's Registration Statement or Prospectus, (iii) any instructions of an
officer of such Fund, or (iv) any opinion of legal counsel for such Fund or the
Administrator, or arising out of transactions or other activities of such Fund
which occurred prior to the commencement of this Agreement; provided, that no
Fund shall indemnify the Administrator for costs, expenses, damages, liabilities
or claims arising out of the Administrator's own gross negligence, bad faith or
willful misconduct. This indemnity shall be a continuing obligation of each
Fund, its successors and assigns, notwithstanding the termination of this
Agreement.
Actions taken or omitted in reliance on written instructions, or upon any
information, order, indenture, stock certificate, power of attorney, assignment,
affidavit or other instrument believed by the Administrator to be genuine or
bearing the signature of a person or persons believed to be authorized to sign,
countersign or execute the same, or upon the opinion of legal counsel for a Fund
or its own counsel, shall be conclusively presumed to have been taken or omitted
in good faith. In no event shall the Bank be required to accept or act upon any
oral instructions; regardless of the circumstances.
COMPENSATION.
For the services provided hereunder, each Fund agrees to pay the Administrator
such compensation as is mutually agreed from time to time and such out-of-pocket
expenses (e.g., telecommunication charges, postage and delivery charges, record
retention costs, reproduction charges and transportation and lodging costs) as
are incurred by the Administrator in performing its duties hereunder. Except as
hereinafter set forth, compensation shall be calculated and accrued daily and
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paid monthly. Each Fund authorizes the Administrator to debit such Fund's
custody account for all amounts due and payable hereunder. The Administrator
shall deliver to each Fund invoices for services rendered after debiting such
Fund's custody account with an indication that payment has been made. Upon
termination of this Agreement before the end of any month, the compensation for
such part of a month shall be prorated according to the proportion which such
period bears to the full monthly period and shall be payable upon the effective
date of termination of this Agreement. For the purpose of determining
compensation payable to the Administrator, each Fund's net asset value shall be
computed at the times and in the manner specified in the Fund's Prospectus.
TERM OF AGREEMENT.
This Agreement shall continue until terminated by either the Administrator
giving to a Fund, or a Fund giving to the Administrator, a notice in writing
specifying the date of such termination, which date shall be not less than 30
days after the date of the giving of such notice. Upon termination hereof, the
affected Fund(s) shall pay to the Administrator such compensation as may be due
as of the date of such termination, and shall reimburse the Administrator for
any disbursements and expenses made or incurred by the Administrator and payable
or reimbursable hereunder.
FORCE MAJEURE.
The Administrator shall not be responsible or liable for any failure or delay in
the performance of its obligations under this Agreement arising out of or
caused, directly or indirectly, by circumstances beyond its reasonable control,
including without limitation, acts of God; earthquakes; fires; floods; wars;
civil or military disturbances; sabotage; epidemics; riots; interruptions, loss
or malfunctions of utilities, computer (hardware or software) or communications
service; accidents; labor disputes; acts of civil or military authority or
governmental actions; it being understood that the Administrator shall use its
best efforts to resume performance as soon as practicable under the
circumstances.
AMENDMENT.
This Agreement may not be amended or modified in any manner except by a written
agreement executed by the Administrator and the Fund to be bound thereby, and
authorized or approved by such Fund's Board.
ASSIGNMENT.
This Agreement shall extend to and shall be binding upon the parties hereto, and
their respective successors and assigns; provided, however, that this Agreement
shall not be assignable by any Fund without the written consent of the
Administrator, or by the Administrator without the written consent of the
affected Fund accompanied by the authorization or approval of such Fund's Board.
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GOVERNING LAW; CONSENT TO JURISDICTION.
This Agreement shall be construed in accordance with the laws of the State of
New York, without regard to conflict of laws principles thereof. Each Fund
hereby consents to the jurisdiction of a state or federal court situated in New
York City, New York in connection with any dispute arising hereunder. Customer
and Custodian each hereby irrevocably waives any and all rights to trial by jury
in any legal proceeding arising out of or relating to this Agreement. To the
extent that in any jurisdiction any Fund may now or hereafter be entitled to
claim, for itself or its assets, immunity from suit, execution, attachment
(before or after judgment) or other legal process, such Fund irrevocably agrees
not to claim, and it hereby waives, such immunity.
SEVERABILITY.
In case any provision in or obligation under this Agreement shall be invalid,
illegal or unenforceable in any jurisdiction, the validity, legality and
enforceability of the remaining provisions or obligations shall not in any way
be affected or impaired thereby, and if any provision is inapplicable to any
person or circumstances, it shall nevertheless remain applicable to all other
persons and circumstances.
NO WAIVER.
Each and every right granted to the Administrator hereunder or under any other
document delivered hereunder or in connection herewith, or allowed it by law or
equity, shall be cumulative and may be exercised from time to time. No failure
on the part of the Administrator to exercise, and no delay in exercising, any
right will operate as a waiver thereof, nor will any single or partial exercise
by the Administrator of any right preclude any other or future exercise thereof
or the exercise of any other right.
NOTICES.
All notices, requests, consents and other communications pursuant to this
Agreement in writing shall be sent as follows:
if to a Fund, at
------------------------
------------------------
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Attention:
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if to the Administrator, at
The Bank of New York
000 Xxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention:
or at such other place as may from time to time be designated in writing.
Notices hereunder shall be effective upon receipt.
COUNTERPARTS.
This Agreement may be executed in any number of counterparts, each of which
shall be deemed to be an original; but such counterparts together shall
constitute only one instrument.
SEVERAL OBLIGATIONS.
The parties acknowledge that the obligations of the Funds hereunder are several
and not joint, that no Fund shall be liable for any amount owing by another Fund
and that the Funds have executed one instrument for convenience only.
IN WITNESS WHEREOF, the parties hereto have caused the foregoing instrument to
be executed by their duly authorized officers and their seals to be hereunto
affixed, all as of the day and year first above written.
By:
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on behalf of each Fund
identified on Exhibit A
attached hereto
THE BANK OF NEW YORK
By:
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Title:
8
EXHIBIT A
NAME OF FUND
Madison/Claymore Covered Call Fund
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SCHEDULE I
ADMINISTRATIVE SERVICES
1. Maintain each Fund's minute book and its general corporate records
(other than accounting books and records).
2. Monitor and document compliance by each Fund with its policies and
restrictions as delineated in its Prospectus.
3. Participate in the periodic updating of each Fund's Registration
Statement and Prospectus and, subject to approval by such Fund's
Treasurer and legal counsel, coordinate the preparation, filing,
printing and dissemination of periodic reports and other information
to the SEC and the Fund's shareholders, including annual and
semi-annual reports to shareholders, annual and semi-annual Form N-SAR
and Form N-CSR, notices pursuant to Rule 24(f)-2 and proxy materials.
4. Prepare federal, state and local income tax returns for each Fund and
Series and file such returns upon the approval of the Funds'
respective independent accountants; monitor and report on Sub-Chapter
M qualifications; prepare and file all Form 1099s with respect to each
Fund's directors or trustees; monitor compliance with Section 4982 of
the Internal Revenue Code; calculate and maintain records pertaining
to Original Issue Discount and premium amortization as required;
perform ongoing wash sales review (i.e., purchases and sales of Fund
investments within 30 days of each other).
5. Prepare and, subject to approval of each Fund's Treasurer, disseminate
to such Fund's Board quarterly unaudited financial statements and
schedules of such Fund's investments and make presentations to the
Board, as appropriate.
6. Subject to approval of each Fund's Board, assist such Fund in
obtaining fidelity bond and E&O/D&O insurance coverage.
7. Prepare statistical reports for outside information services (e.g.,
IBC/Xxxxxxxx, ICI, Lipper Analytical and Morningstar).
8. Attend shareholder and Board meetings as requested from time to time.
9. Establish appropriate expense accruals, maintain expense files and
coordinate the payment of invoices.
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10. Blue Sky Services
- Subject to approval of each Fund's Board and its legal counsel,
perform initial registration for Funds or Series in such states as
each Fund shall identify to the Administrator.
- Subject to approval of each Fund's Board and its legal counsel,
perform renewal registration for Funds or Series in such states as
each Fund shall identify to the Administrator.
- Receive nightly downloads of sales data from transfer agents.
- Update state/territory sales information for each Fund or Series.
- Create and maintain state/territory sales information worksheets
for each Fund or Series.
- Monitor changes in Blue Sky laws and procedures for all registered
states/territories.
- Subject to approval of each Fund's legal counsel, update filing
requirements for all law and procedural changes.
- Communicate directly with regulatory authorities in
states/territories as needed.
- Periodically attend Investment Company Institute (ICI) State
Liaison Committee meetings.
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