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ADMINISTRATION AGREEMENT
ADMINISTRATION AGREEMENT, made as of July [ ], 2007 between Cornerstone
Progressive Return Fund, a Delaware trust (the "Fund"), and Bear Xxxxxxx Funds
Management Inc., a Delaware corporation (the "Administrator").
W I T N E S S E T H:
WHEREAS, the Fund is a closed-end, diversified, management investment company
under the Investment Company Act of 1940, as amended (the "Investment Company
Act"); and
WHEREAS, the Fund has retained an investment adviser for the purpose of
investing its assets in securities and desires to retain the Administrator for
certain administrative services, and the Administrator is willing to furnish
such administrative services on the terms and conditions hereinafter set forth;
NOW, THEREFORE, the parties hereto agree as follows:
1. APPOINTMENT. The Fund hereby appoints the Administrator to provide the
services set forth below, subject to the overall supervision of the
Board of Trustees of the Fund (the "Board") for the period and on the
terms set forth in this Agreement. The Administrator hereby accepts
such appointment and agrees during such period to render the services
herein described and to assume the obligations herein set forth; for
the compensation herein provided.
2. DESCRIPTION OF SERVICES. Subject to the supervision of the Board and
the officers of the Fund, the Administrator shall provide office
facilities and personnel to assist the officers of the Fund in the
performance of the following services:
(a) Consult with the Fund's officers, independent registered public
accounting firm, legal counsel, custodian, accounting agent and
transfer agent in establishing the accounting policies of the
Fund;
(b) Oversee the maintenance by the Fund's custodian of certain books
and records of the Fund as required under the Investment Company
Act and maintain (or oversee maintenance by such other persons as
approved by the Board) such other books and records (other than
those maintained by the investment adviser and other Fund service
providers) required by law or for the proper operation of the
Fund;
(c) Review the appropriateness of and arrange for the payment of the
Fund's expenses;
(d) Oversee and review calculations of fees paid to the
Administrator, the Fund's investment adviser, its custodian, and
any other service providers of the Fund as determined and
recorded by the Fund's accounting agent;
(e) Prepare, maintain and disseminate total return performance
calculations on at least a quarterly basis;
(f) Prepare and periodically update a chart covering the general
responsibilities of the Board at their quarterly meetings;
(g) Maintain a calendar for all future Board meeting, including the
maintenance of the Fund's minute book;
(h) Prepare for review and approval by officers of the Fund,
financial information for the Fund's quarterly, semi-annual,
annual and other periodic reports, proxy statements and other
communications with shareholders required or otherwise to be sent
to the Fund's shareholders, and arrange for the printing and
dissemination of such reports and communications to shareholders;
(i) Prepare for review by an officer of the Fund, the Fund's periodic
financial reports required to be incorporated into and filed with
the Securities and Exchange Commission ("SEC") on Form N-SAR,
Form N-Q, Form N-CSR and Form N-2 and such other reports, forms
or filings as may be mutually agreed upon;
(j) Prepare the financial information for certain SEC filings (E.G.,
proxy statements), review such filings as prepared by the Fund's
counsel in their entirety and provide comments to the Fund's
management and other appropriate parties (E.G., legal counsel);
(k) Assist in the preparation and the filing of the Fund's federal,
state and local income tax returns and any other required tax
return;
(l) Prepare, distribute and file with the Internal Revenue Service,
Form 1099-MISC for payments made to the Fund's trustees, legal
counsel and independent registered public accounting firm;
(m) Compute the amount of dividends and distributions to be paid by
the Fund; ensure proper notification accompanying payment(s), if
applicable, and year-end reporting of such dividends and
distributions;
(n) Develop and implement procedures to assist the investment adviser
in monitoring, on a periodic basis, compliance with regulatory
requirements and the Fund's investment objectives, policies and
restrictions as set forth in the Fund's prospectus and as amended
by the Board and by the Fund's shareholders;
(o) Review implementation of any stock purchase or dividend
reinvestment programs authorized by the Board;
(p) Review of dividend and distribution notifications sent to Fund
shareholders;
(q) Assist the Fund in obtaining any required insurance;
(r) File with the SEC the fidelity bond and arrange for the
preparation of a memorandum or other appropriate correspondence
that outlines the terms and conditions of such policy;
(s) Prepare such financial information reports as may be required by
any stock exchange or exchanges on which the Fund's shares are
listed;
(t) Monitor any share repurchase program the Fund may engage in,
including the timely reporting of such information to any stock
exchange or exchanges on which the Fund's shares are listed;
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(u) Prepare the notice and agenda for any regularly scheduled board
meetings or audit committee meetings. Such notices and agendas
will be subject to the review of fund management or fund counsel
prior to the distribution to the Board or Audit Committee
members;
(v) Coordinate the production and distribution of the board materials
to the trustees, officers and other directly-interested parties
(E.G., legal counsel, independent registered public accounting
firm) with the assistance of Fund management and Fund counsel and
provide meeting facilities, if necessary;
(w) Prepare initial drafts of the minutes of meetings of the Board
(including committees thereof) and shareholder meetings,
incorporating comments and revisions received from Fund
management, Fund counsel and other interested parities;
(x) Manage the process with respect to the shareholder meetings.
Specifically, arrange for the solicitation of proxies (including
engaging a proxy solicitor), oversee the tabulation of votes, and
provide the meeting facilities, if necessary;
(y) Gather news and market updates on the Fund;
(z) Respond to or refer to the Fund's officers or its transfer agent,
shareholder inquiries relating to the Fund;
(aa) Prepare reports relating to the business and affairs of the Fund
as may be mutually agreed upon and not otherwise appropriately
prepared by the Fund's investment adviser, its custodian,
transfer agent, legal counsel or independent registered public
accounting firm;
(bb) Make such reports and recommendations to the Board concerning the
performance and fees of the Fund's other service providers as the
Board may reasonably request or deem appropriate;
(cc) Provide communication and coordination services with regard to
the Fund's investment adviser, its transfer agent, custodian and
other service providers that render recordkeeping or shareholder
communication services to the Fund; and
(dd) Provide such assistance to the Fund's investment adviser, its
custodian, transfer agent, legal counsel and independent
registered public accounting firm as generally may be required to
properly carry on the business and operations of the Fund.
All services are to be furnished through the medium of any trustees, officers or
employees of the Administrator, as the Administrator deems appropriate in order
to fulfill its obligations hereunder.
Each party shall bear all its own expenses incurred in connection with this
Agreement, except as noted below.
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3. COMPENSATION. The Fund will pay the Administrator a monthly fee at the
annual rate of 0.10% of its average net assets determined on the last
day of the month on which the American Stock Exchange, LLC is open for
business, subject to a minimum annual fee of $50,000. In addition to
the fee, the Fund will be required to reimburse to the Administrator
all reasonable out-of-pocket expenses incurred by the Administrator for
attendance at any meetings (outside of the New York metropolitan area)
of the Board, or any committees of such Board, or at any other meetings
or presentations for which the Administrator is required to attend.
4. RESPONSIBILITY OF ADMINISTRATOR. The Administrator assumes no
responsibility under this Agreement other than to render the services
called for hereunder, and specifically assumes no responsibilities for
investment advice or the investment or reinvestment of the Fund's
assets.
5. INDEMNIFICATION. The Administrator shall not be liable to the Fund for
any action taken or omitted to be taken by the Administrator in
connection with the performance of any of its duties or obligations
under this Agreement, and the Fund shall indemnify the Administrator
and hold it harmless from and against all damages, liabilities, costs
and expenses (including reasonable attorneys' fees and amounts
reasonably paid in settlement) incurred by the Administrator in or by
reason of any pending, threatened or completed action, suit,
investigation or other proceeding (including an action or suit by or in
the right of the Fund or its security shareholders) arising out of or
otherwise based upon any action actually or allegedly taken or omitted
to be taken by the Administrator in connection with the performance of
any of its duties or obligations under this Agreement; provided,
however, that nothing contained herein shall protect or be deemed to
protect the Administrator against or entitle or be deemed to entitle
the Administrator to indemnification in respect of any liability to the
Fund or its security holders to which the Administrator would otherwise
be subject by reason of willful misfeasance, bad faith or gross
negligence in the performance of its duties or, by reason of its
reckless disregard of its duties and obligations under this Agreement.
The Administrator shall indemnify the Fund for damages resulting from
the Administrator's willful misfeasance, bad faith or gross negligence
in the performance of any of its duties or obligations under this
Agreement. In no event shall the Administrator be liable for, or be
obligated to indemnify the Fund for, special, indirect or consequential
damages even if the Administrator has been advised of the possibility
of such damages.
6. DURATION AND TERMINATION. This Agreement shall become effective as of
the date hereof and shall thereafter continue in effect unless
terminated as herein provided. This Agreement may be terminated by
either party hereto (without penalty) at any time by giving not less
than 60 days' prior written notice to the other party hereto.
7. SERVICES TO OTHERS. The services of the Administrator to the Fund
hereunder are not exclusive and nothing in this Agreement shall limit
or restrict the right of the Administrator to engage in any other
business or to render services of any kind to any other corporation,
firm, individual or association. The Administrator shall be deemed to
be an independent contractor, unless otherwise expressly provided or
authorized by this Agreement.
8. REFERENCES TO THE ADMINISTRATOR. During the term of this Agreement, the
Fund agrees to furnish the Administrator at the principal office of the
Administrator prior to use thereof all prospectuses, proxy statements,
reports to shareholders, sales literature, or other material prepared
for distribution to shareholders of the Fund or the public that refer
in any way to the Administrator. If the Administrator reasonably
objects in writing to such references within five business days (or
such other time as may be mutually agreed) after receipt thereof, the
Fund will modify such references in a manner reasonably satisfactory to
the Administrator. In the event of termination of this Agreement, the
Fund will continue to furnish to the Administrator copies of any of the
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above-mentioned materials that refer in any way to the Administrator
and, as soon as practicable after such termination, shall eliminate all
references to the Administrator in all written materials used
thereafter. The Fund shall furnish or otherwise make available to the
Administrator such other information relating to the business affairs
of the Fund as the Administrator at any time, or from time to time,
reasonably requests in order to discharge its obligations hereunder.8.
9. RECORD RETENTION AND CONFIDENTIALITY. The Administrator shall keep and
maintain on behalf of the Fund all books and records which the Fund and
the Administrator is, or may be, required to keep and maintain pursuant
to any applicable statutes, rules and regulations, including without
limitation Rules 31a-1 and 31a-2 under the Investment Company Act,
relating to the maintenance of books and records in connection with the
services to be provided hereunder. Bear Xxxxxxx Funds Management Inc.
further agrees that all such books and records shall be the property of
the Fund and to make such books and records available for inspection by
the Fund or by the SEC at reasonable times and otherwise to keep
confidential all books and records and other information relative to
the Fund and its shareholders; except when requested to divulge such
information by duly-constituted authorities or court process.
10. AMENDMENTS. This Agreement may be amended only by mutual written
consent.
11. NOTICES. Any notice or other communication required to be given
pursuant to this Agreement shall be deemed duly given if delivered or
mailed by registered mail, postage prepaid, (1) to the Administrator at
000 Xxxxxxx Xxxxxx, 00xx xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Xxxxx X. Xxxxxxx, President and Chief Executive Officer or (2) to the
Fund, 000 Xxxxxxx Xxxxxx - 00xx xxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Xxxxx X. Xxxxxxxx.
12. ENTIRE AGREEMENT. This Agreement sets forth the entire agreement and
understanding of the parties hereto solely with respect to the matters
covered hereby and the relationship between the Fund and Bear Steams
Funds Management Inc. as Administrator. Nothing in this Agreement shall
govern, restrict or limit in any respect any other business dealings
between the parties hereto unless otherwise expressly provided herein.
13. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware without reference to
choice of law principles thereof and in accordance with the Investment
Company Act. In the case of any conflict the Investment Company Act
shall control.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed by their officers designated below as of the day and year first above
written.
ATTEST: CORNERSTONE PROGRESSIVE RETURN FUND
By:
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Name: Xxxxx X. Xxxxxxxx
Title: President
ATTEST: BEAR XXXXXXX FUNDS MANAGEMENT INC.
By:
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Name: Xxxxx X. Xxxxxxx
Title: President and
Chief Executive Officer
