Exhibit (j)(3)
ADMINISTRATION AGREEMENT
The Administration Agreement of F&C/CLAYMORE PREFERRED SECURITIES
INCOME FUND INCORPORATED, a Maryland corporation (the "Fund") made and agreed to
by and between the Fund and PFPC Inc., a Massachusetts corporation ("PFPC"), on
January __, 2003, to read in its entirety as follows:
WHEREAS, the Fund is registered as a diversified, closed-end management
investment company under the Investment Company Act of 1940, as amended (the
"1940 Act"); and
WHEREAS, the Fund desires to retain PFPC to render certain
administrative services to the Fund and PFPC is willing to render such services;
WITNESSETH:
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, it is agreed between the parties hereto as follows:
1. Appointment. The Fund hereby appoints PFPC to act as
Administrator of the Fund on the terms set forth in this Agreement. PFPC accepts
such appointment and agrees to render the services herein set forth for the
compensation herein provided.
2. Delivery of Documents. The Fund has furnished PFPC with copies
properly certified or authenticated of each of the following:
(a) Resolutions of the Fund's Board of Directors authorizing
the appointment of PFPC to provide certain administrative services to
the Fund and approving this Agreement;
(b) The Fund's Articles of Incorporation filed with the
Maryland Department of Assessments and Taxation on May 23, 2002 and
all amendments thereto (the "Articles");
(c) The Fund's By-Laws and all amendments thereto (the
"By-Laws");
(d) The Investment Advisory Agreement between Xxxxxxxx &
Xxxxxxxx Incorporated (the "Adviser") and the Fund dated as of January
__, 2003 as amended and restated from time to time (the "Advisory
Agreement");
(e) The Custody Agreement between PFPC Trust Company and the
Fund dated as of January __, 2003 as amended and restated from time to
time (the "Custody Agreement");
(f) The Transfer Agency and Registrar Agreement between PFPC
and the Fund dated as of January __, 2003 as amended and restated from
time to time;
(g) The Fund's most recent Registration Statement on Form N-2
(the "Registration Statement") under the Securities Act of 1933 and
under the 1940 Act (File Nos. 333-91282 and 811-21129), as filed with
the Securities and Exchange Commission ("SEC") on June 26, 2002
relating to shares of the Fund's Common Stock, $.01 par value per
share, and all amendments thereto; and
(h) The Fund's most recent prospectus (the "Prospectus").
The Fund will furnish PFPC from time to time with copies, properly
certified or authenticated, of all amendments of or supplements to the
foregoing. Furthermore, the Fund will provide PFPC with any other documents that
PFPC may reasonably request and will notify PFPC as soon as possible of any
matter materially affecting the performance of PFPC of its services under this
agreement.
3. Duties as Administrator. Subject to the supervision and direction of
the Board of directors of the Fund, PFPC, as Administrator, will assist in
supervising various aspects of the Fund's administrative operations and
undertakes to perform the following specific services:
(a) Maintaining office facilities (which may be in the offices
of PFPC or a corporate affiliate);
(b) Furnishing statistical and research data, data processing
services, clerical services, and internal legal, executive the
administrative services and stationery and office supplies in
connection with the foregoing;
(c) Furnishing corporate secretarial services including
preparation and distribution of materials for Board of Directors
meetings;
(d) Accounting and bookkeeping services (including the
maintenance of such accounts, books and records of the Fund as may be
required by section 31(a) of the 1940 Act and the rules thereunder);
(e) Internal auditing;
(f) Valuing the Fund's assets and calculating the net asset
value of the shares of the Fund at the close of trading on the New
York Stock Exchange (the "NYSE") on the last day on which the NYSE is
open for trading of each week and month and at such other times as the
Board of Directors may reasonably request;
(g) Accumulating information for and, subject to approval by
the Fund's Treasurer, preparing reports to the Fund's shareholders of
record and the SEC including, but not necessarily limited to, Annual
Reports and Semi-Annual Reports on Form N-SAR;
(h) Preparing and filing various reports or other documents
required by federal, state and other applicable laws and regulations
and by stock exchanges on which the shares of the Fund are listed,
other than those filed or required to be filed by the Adviser or
Transfer Agent;
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(i) Preparing and filing the Fund's tax returns;
(j) Assisting the Adviser, at the Adviser's request, in
monitoring and developing compliance procedures for the Fund which
will include, among other matter, procedures to assist the Adviser in
monitoring compliance with the Fund's investment objective, policies,
restrictions, tax matters and applicable laws and regulations;
(k) Preparing and furnishing the Fund (at the Fund's request)
with the performance information (including yield and total return
information) calculated in accordance with applicable U.S. securities
laws and reporting to external databases such information as may
reasonably be requested; and
(l) Upon request from the Fund (which request may be a
standing request), PFPC will arrange for the sweep of the Fund's daily
net excess cash balance in accordance with written instructions (which
may be standing instructions) acceptable to PFPC which are received
from or on behalf of the Fund.
In performing all services under this Agreement, PFPC shall act in
conformity with the Fund's Articles and By-Laws; the 1940 Act and the Investment
Advisers Act of 1940, as the same may be amended from time to time; and the
investment objective, investment policies and other practices and policies set
forth in the Fund's Registration Statement as such Registration Statement and
practices and policies may be amended from time to time.
4. Allocation of Expenses. PFPC shall bear all expenses in connection
with the performance of its services under this Agreement.
(a) PFPC will from time to time employ or associate with
itself such person or persons as PFPC may believe to be particularly
suited to assist it in performing services under this Agreement. Such
person or persons may be officers and employees who are employed by
both PFPC and the Fund. The compensation of such person or persons
shall be paid by PFPC and no obligation shall be incurred on behalf of
the Fund in such respect.
(b) PFPC shall not be required to pay any of the following
expenses incurred by the Fund: membership dues in the Investment
Company Institute or any similar organization; investment advisory
expenses; costs of printing and mailing stock certificates,
prospectuses, reports and notices; interest on borrowed money;
brokerage commissions; taxes and fees payable to Federal, state and
other governmental agencies; fees of Directors of the Fund who are not
affiliated with PFPC; outside auditing expenses; outside legal
expenses; or other expenses not specified in this Section 4 which may
be properly payable by the Fund.
(c) For the services to be rendered, the facilities to be
furnished and the payments to be made by PFPC, as provided for in this
Agreement, the Fund will pay PFPC the fees in accordance with the Fee
Agreement among the Fund, PFPC Trust Company and PFPC dated January
__, 2003 and attached hereto as Schedule A.
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(d) The Fund will compensate PFPC for its services rendered
pursuant to this Agreement in accordance with the fees set forth
above. Such fees do not include out-of-pocket disbursements of PFPC.
PFPC shall be entitled to xxxx the Fund for such out-of-pocket
expenses only upon the prior written approval of the Fund.
(e) PFPC will xxxx the Fund as soon as practicable after the
end of each calendar month, and said xxxxxxxx will be detailed in
accordance with the out-of-pocket schedule. The Fund will promptly pay
to PFPC the amount of such billing.
5. Limitation of Liability.
(a) PFPC 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 performance of its obligations and duties under this Agreement,
except a loss resulting from PFPC willful misfeasance, bad faith or
gross negligence in the performance of such obligations and duties, or
by reason of its reckless disregard thereof. The Fund will indemnify
PFPC against and defend and hold it harmless from any and all losses,
claims, damages, liabilities of expenses (including reasonable counsel
fees and expenses) resulting from any claim, demand, action or suit not
resulting from the willful misfeasance, bad faith or gross negligence
of PFPC in the performance of such obligations and duties or by reason
of its reckless disregard thereof.
(b) Notwithstanding anything in this Agreement to the
contrary, neither PFPC nor the Fund, including their respective
affiliates shall be liable for any consequential, special or indirect
losses or damages, whether or not the likelihood of such losses or
damages was known by either party or its affiliates.
6. Termination of Agreement.
(a) This Agreement shall become effective on the date hereof
and shall remain in force from year to year so long as such
continuance is specifically approved at least annually by the Board of
Directors of the Fund or unless terminated pursuant to the provisions
of subsection (b) of this Section 6.
(b) This Agreement may be terminated at any time without
payment of any penalty, upon 60 days' written notice, by vote of the
holders of a majority of the outstanding voting securities of the
Fund, or by vote of a majority of the Board of Directors of the Fund,
or by the PFPC.
7. Amendment to this Agreement. No provisions of this Agreement may be
changed, discharged or terminated orally, but only by an instrument in writing
signed by the party against which enforcement of the change, discharge or
termination is sought.
8. Miscellaneous.
(a) Any notice or other instrument authorized or required by
this Agreement to be given in writing to the Fund or PFPC shall be
sufficiently given if addressed to that
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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 Fund:
F&C/Claymore Preferred Securities Income Fund Incorporated
c/x Xxxxxxxx & Xxxxxxxx Incorporated
000 X. Xxxxxxxx Xxxx-Xxxxx 000
Xxxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxxxx
To PFPC:
PFPC Inc.
000 Xxxxxxxx Xxxxxxx
Xxxxxxxxxx, XX 00000
(b) 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 without
the written consent of the other party.
(c) This Agreement shall be deemed to be a contract made in
Delaware and governed by Delaware law, without regard to principles of
conflicts of law.
(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 shall be deemed to
constitute only one instrument.
(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.
(f) Neither party shall be liable or responsible for delays or
errors by acts of God or by reason of circumstances beyond its
control, including acts of civil or military authority, acts of
terrorism, national emergencies, labor difficulties, mechanical
breakdown, insurrection, war, riots, or failure or unavailability of
transportation, communication or power supply, fire, flood or other
catastrophe.
9. Confidentiality. All books, records, information and data pertaining
to the business of the Fund that are exchanged or received pursuant to the
performance of PFPC duties under this Agreement shall remain confidential and
shall not be voluntarily disclosed to any other person, except as specifically
authorized by the Fund or as may be required by law.
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IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be duly executed and delivered by their duly authorized officers as of the date,
first written above.
PFPC INC.
___________________________________
By
Title:
F&C/CLAYMORE PREFERRED SECURITIES
INCOME FUND INCORPORATED
___________________________________
By
Title:
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