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FUND ADMINISTRATION SERVICING AGREEMENT
THIS AGREEMENT is made and entered into as of this 23rd day of May, 2001,
by and between 1-800-MUTUALS Advisor Series, a business trust organized under
the laws of the State of Delaware (hereinafter referred to as the "Trust") and
Firstar Mutual Fund Services, LLC, a limited liability company organized under
the laws of the State of Wisconsin (hereinafter referred to as the "FMFS").
WHEREAS, the Trust is an open-end management investment company which is
registered under the Investment Company Act of 1940, as amended (the "1940
Act");
WHEREAS, the Trust is authorized to create separate series, each with its
own separate investment portfolio;
WHEREAS, FMFS is a limited liability company and, among other things, is in
the business of providing fund administration services for the benefit of its
customers; and
WHEREAS, the Trust desires to retain FMFS to act as Administrator for each
series of the Trust listed on Exhibit A attached hereto, (each hereinafter
referred to as a "Fund"), as may be amended from time to time.
NOW, THEREFORE, in consideration of the mutual agreements herein made, the
Trust and FMFS agree as follows:
1. Appointment of Administrator
The Trust hereby appoints FMFS as Administrator of the Trust on the terms
and conditions set forth in this Agreement, and FMFS 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.
2. Duties and Responsibilities of FMFS
A. General Fund Management
(1) Act as liaison among all Fund service providers
(2) Supply:
a. Corporate secretarial services
b. Office facilities (which may be in FMFS's or its affiliate's
own offices)
c. Non-investment-related statistical and research data as
needed
(3) Coordinate board communication by:
a. Establish 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
f. Recommend dividend declarations to the Board, prepare and
distribute to appropriate parties notices announcing
declaration of dividends and other distributions to
shareholders
g. Provide personnel to serve as officers of the Trust if so
elected by the Board and attend Board meetings to present
materials for Board review
(4) Audits
a. Prepare appropriate schedules and assist independent
auditors
b. Provide information to SEC and facilitate audit process
c. Provide office facilities
(5) Assist in overall operations of the Fund
(6) Pay Fund expenses upon written authorization from the Trust
(7) Monitor arrangements under shareholder services or similar plan
B. Compliance
(1) Regulatory Compliance
a. Monitor compliance with 1940 Act requirements, including:
(i) Asset diversification tests
(ii) Total return and SEC yield calculations
(iii) Maintenance of books and records under Rule 31a-3
(iv) Code of Ethics for the disinterested trustees of the
Fund
b. Monitor Fund's compliance with the policies and investment
limitations of the Trust as set forth in its Prospectus and
Statement of Additional Information
c. Maintain awareness of applicable regulatory and operational
service issues and recommend dispositions
(2) Blue 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 Trust so as to
enable the Trust to make a continuous offering of its shares
in all states
b. Monitor status and maintain registrations in each state
c. Provide information regarding material developments in state
securities regulation
(3) SEC Registration and Reporting
a. Assist Trust 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, Form N-SAR filings
and Rule 24f-2 notices
c. Coordinate the printing, filing and mailing of publicly
disseminated Prospectuses and reports
d. File fidelity bond under Rule 17g-1
e. File shareholder reports under Rule 30b2-1
f. Monitor sales of each Fund's shares and ensure that such
shares are properly registered with the SEC and the
appropriate state authorities
g. File Rule 24f-2 notices
(4) IRS Compliance
a. Monitor Company's status as a regulated investment company
under Subchapter M, including without limitation, review of
the following:
(i) Asset diversification requirements
(ii) Qualifying income requirements
(iii) Distribution 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;
2) Prepare financial reports for officers, shareholders, tax
authorities, performance reporting companies, the board, the SEC,
and independent auditors;
(3) Supervise the Trust's Custodian and Fund Accountants in the
maintenance of the Trust'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 Trust's net assets and of the Trust's shares, and of
the declaration and payment of dividends and other distributions
to shareholders;
(4) Compute the yield, total return and expense ratio of each class
of each Fund, and each Fund's portfolio turnover rate; and
(5) Monitor the expense accruals and notify Trust management of any
proposed adjustments.
(6) Prepare monthly financial statements, which will include without
limitation the following items: - Schedule of Investments
- Statement of Assets and Liabilities
- Statement of Operations
- Statement of Changes in Net Assets
- Cash Statement
- Schedule of Capital Gains and Losses
(7) Prepare quarterly broker security transaction summaries.
D. Tax Reporting
(1) Prepare and file on a timely basis appropriate federal and state
tax returns including, without limitation, Forms 1120/8610 with
any necessary schedules
(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
3. Compensation
The Trust, on behalf of the Fund, agrees to pay FMFS 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. Notwithstanding anything to the
contrary, amounts owed by the Trust to FMFS shall only be paid out of the
assets and property of the particular Fund involved.
These fees may be changed from time to time, subject to mutual written
Agreement between the Trust and FMFS.
The Trust 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. FMFS shall exercise reasonable care in the performance of its duties
under this Agreement. FMFS shall not be liable for any error of
judgment or mistake of law or for any loss suffered by the Trust in
connection with matters to which this Agreement relates, including
losses resulting from mechanical breakdowns or the failure of
communication or power supplies beyond FMFS's control, except a loss
arising out of or relating to FMFS'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, if
FMFS has exercised reasonable care in the performance of its duties
under this Agreement, the Trust shall indemnify and hold harmless FMFS
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 FMFS may
sustain or incur or which may be asserted against FMFS by any person
arising out of any action taken or omitted to be taken by it in
performing the services hereunder, except for any and all claims,
demands, losses, expenses, and liabilities arising out of or relating
to FMFS's refusal or failure to comply with the terms of this
Agreement or from bad faith, negligence or from willful misconduct on
its part in performance of its duties under this Agreement, (i) in
accordance with the foregoing standards, or (ii) in reliance upon any
written or oral instruction provided to FMFS by any duly authorized
officer of the Trust, such duly authorized officer to be included in a
list of authorized officers furnished to FMFS and as amended from time
to time in writing by resolution of the Board of Trustees of the
Trust.
FMFS shall indemnify and hold the Trust 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 Trust may sustain or
incur or which may be asserted against the Trust by any person arising
out of any action taken or omitted to be taken by FMFS as a result of
FMFS'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, FMFS shall take all reasonable
steps to minimize service interruptions for any period that such
interruption continues beyond FMFS's control. FMFS 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 FMFS. FMFS
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 Trust shall be entitled
to inspect FMFS's premises and operating capabilities at any time
during regular business hours of FMFS, upon reasonable notice to FMFS.
Regardless of the above, FMFS reserves the right to reprocess and
correct administrative errors at its own expense.
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. 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.
C. FMFS is hereby expressly put on notice of the limitation of
shareholder liability as set forth in the Trust's Declaration of Trust
and agrees that obligations assumed by the Trust pursuant to this
Agreement shall be limited in all cases to the Trust and its assets,
and if the liability relates to one or more series, the obligations
hereunder shall be limited to the respective assets of such series.
FMFS further agrees that it shall not seek satisfaction of any such
obligation from the shareholder or any individual shareholder of a
series of the Trust, nor from the Trustees or any individual Trustee
of the Trust.
5. Proprietary and Confidential Information
FMFS agrees on behalf of itself and its directors, officers, and
employees to treat confidentially and as proprietary information of
the Trust all records and other information relative to the Trust and
prior, present, or potential shareholders of the Trust (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 Trust, which approval shall not be unreasonably
withheld and may not be withheld where FMFS 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 Trust.
6. Term of Agreement
This Agreement shall become effective as of the date hereof and will
continue in effect for a period of three years. Subsequent to the
initial three-year term, this 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. However, this Agreement may be amended by mutual written
consent of the parties.
7. Records
FMFS 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 Trust but not inconsistent with the
rules and regulations of appropriate government authorities, in
particular, Section 31 of the 1940 Act and the rules thereunder. FMFS
agrees that all such records prepared or maintained by FMFS relating
to the services to be performed by FMFS hereunder are the property of
the Trust 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 Trust on and in accordance with its
request.
8. 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 Securities and Exchange Commission thereunder.
9. Duties in the Event of Termination
In the event that, in connection with termination, a successor to any
of FMFS's duties or responsibilities hereunder is designated by the
Trust by written notice to FMFS, FMFS will promptly, upon such
termination and at the expense of the Trust, transfer to such
successor all relevant books, records, correspondence, and other data
established or maintained by FMFS under this Agreement in a form
reasonably acceptable to the Trust (if such form differs from the form
in which FMFS has maintained, the Trust 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 FMFS's personnel in the
establishment of books, records, and other data by such successor.
10. No Agency Relationship
Nothing herein contained shall be deemed to authorize or empower FMFS
to act as agent for the other party to this Agreement, or to conduct
business in the name of, or for the account of the other party to this
Agreement.
11. Data Necessary to Perform Services
The Trust or its agent, which may be FMFS, shall furnish to FMFS the
data necessary to perform the services described herein at times and
in such form as mutually agreed upon if FMFS is also acting in another
capacity for the Trust, nothing herein shall be deemed to relieve FMFS
of any of its obligations in such capacity.
12. 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 FMFS shall be sent to:
Firstar Mutual Fund Services, LLC
000 Xxxx Xxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
and notice to the Trust shall be sent to:
1-800-MUTUALS Advisor Series
c/o XXXXXXX.xxx, Inc.
Plaza of the Americas
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, XX 00000
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.
1-800-MUTUALS ADVISOR SERIES FIRSTAR MUTUAL FUND SERVICES, LLC
By: /s/ Xxxxxx Xxxxxxxxx By: /s/ Xxx X. Xxxxxxx
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Title: President Title: President
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