Exhibit 99.B.23(h)(1)
ADMINISTRATION AND ACCOUNTING SERVICES AGREEMENT
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THIS AGREEMENT is made as of July 1, 2000 by and between PFPC INC., a
Massachusetts corporation ("PFPC"), and McM FUNDS a Delaware business trust (the
"Fund").
W I T N E S S E T H :
WHEREAS, the Fund is registered as an open-end management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act");
and
WHEREAS, the Fund wishes to retain PFPC to provide administration and
accounting services to its investment portfolios listed on Exhibit A attached
hereto and made a part hereof, as such Exhibit A may be amended from time to
time (each a "Portfolio"), and PFPC wishes to furnish such services.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, and intending to be legally bound hereby the parties
hereto agree as follows:
1. Definitions. As Used in this Agreement:
(a) "1933 Act" means the Securities Act of 1933, as amended.
(b) "1934 Act" means the Securities Exchange Act of 1934, as amended.
(c) "Authorized Person" means any officer of the Fund and any other
person duly authorized by the Fund's Board of Trustees to give
Oral Instructions and Written Instructions on behalf of the Fund.
An Authorized Person's scope of authority may be limited by
setting forth such limitation in a written document signed by
both parties hereto.
(d) "CEA" means the Commodities Exchange Act, as amended.
(e) "Change of Control" means a change in ownership or control (not
including transactions between wholly-owned direct or indirect
subsidiaries of a common parent) of 25% or more of the beneficial
ownership of the shares of common stock or shares of beneficial
interest of an entity or its parent(s).
(f) "Oral Instructions" mean oral instructions received by PFPC from
an Authorized Person or from a person reasonably believed by PFPC
to be an Authorized Person. PFPC may, in its sole discretion in
each separate instance, consider and rely upon instructions it
receives from an Authorized Person via electronic mail as Oral
Instructions.
(g) "SEC" means the Securities and Exchange Commission.
(h) "Securities Laws" means the 1933 Act, the 1934 Act, the 1940 Act
and the CEA.
(i) "Shares" means the shares of beneficial interest of any series or
class of the Fund.
(j) "Written Instructions" mean (i) written instructions signed by an
Authorized Person and received by PFPC or (ii) trade instructions
transmitted (and received by PFPC) by means of an electronic
transaction reporting system access to which requires use of a
password or other authorized identifier. The instructions may be
delivered by hand, mail, tested telegram, cable, telex or
facsimile sending device.
2. Appointment. The Fund hereby appoints PFPC to provide administration
and accounting services to each of the Portfolios, in accordance with
the terms set forth in this Agreement. PFPC accepts such appointment
and agrees to furnish such services.
3. Delivery of Documents. The Fund has provided or, where applicable, will
provide PFPC with the following:
(a) at PFPC's request, certified or authenticated copies of the
resolutions of the Fund's Board of Trustees, approving the
appointment of PFPC or its affiliates to provide services to each
Portfolio and approving this Agreement;
(b) a copy of Fund's most recent effective registration statement;
(c) a copy of each Portfolio's advisory agreement or agreements;
(d) a copy of the distribution/underwriting agreement with respect to
each class of Shares representing an interest in a Portfolio;
(e) a copy of each additional administration agreement with respect
to a Portfolio;
(f) a copy of each distribution and/or shareholder servicing plan and
agreement made in respect of the Fund or a Portfolio; and
(g) copies (certified or authenticated, where applicable) of any and
all amendments or supplements to the foregoing.
PFPC will on an annual basis provide to the Fund the audited financial
statements of PNC Bank Corp.
4. Compliance with Rules and Regulations.
PFPC undertakes to comply with all applicable requirements of the
Securities Laws, and any laws, rules and regulations of governmental
authorities having jurisdiction with respect to the duties to be
performed by PFPC hereunder. Except as specifically set forth herein,
PFPC assumes no responsibility for such compliance by the Fund or other
entity.
5. Instructions.
(a) Unless otherwise provided in this Agreement, PFPC shall act only
upon Oral Instructions or Written Instructions.
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(b) PFPC shall be entitled to rely upon any Oral Instruction or
Written Instruction it receives from an Authorized Person (or
from a person reasonably believed by PFPC to be an Authorized
Person) pursuant to this Agreement. PFPC may assume that any Oral
Instruction or Written Instruction received hereunder is not in
any way inconsistent with the provisions of organizational
documents or this Agreement or of any vote, resolution or
proceeding of the Fund's Board of Trustees or of the Fund's
shareholders, unless PFPC knows such instructions are
inconsistent with any of the foregoing (for example because PFPC
has received prior Written Instructions, or has participated in
discussions on the same issue) unless and until PFPC receives
Written Instructions to the contrary.
(c) The Fund agrees to forward to PFPC Written Instructions
confirming Oral Instructions (except where such Oral Instructions
are given by PFPC or its affiliates) so that PFPC receives the
Written Instructions by the close of business on the same day
that such Oral Instructions are received. The fact that such
confirming Written Instructions are not received by PFPC or
differ from the Oral Instructions shall in no way invalidate the
transactions or enforceability of the transactions authorized by
the Oral Instructions or PFPC's ability to rely upon such Oral
Instructions. Where Oral Instructions or Written Instructions
reasonably appear to have been received from an Authorized
Person, PFPC shall incur no liability to the Fund in acting upon
such Oral Instructions or Written Instructions provided that
PFPC's actions comply with the other provisions of this
Agreement.
6. Right to Receive Advice.
(a) Advice of the Fund. If PFPC is in doubt as to any action it
should or should not take, PFPC may request directions or advice,
including Oral Instructions or Written Instructions, from the
Fund.
(b) Advice of Counsel. If PFPC shall be in doubt as to any question
of law pertaining to any action it should or should not take,
PFPC may request advice from counsel of its own choosing (who may
be inside or outside counsel for the Fund, the Fund's investment
adviser or, if none of the foregoing is available and time is of
the essence, PFPC, at the option of PFPC).
(c) Conflicting Advice. In the event of a conflict between directions
or advice or Oral Instructions or Written Instructions PFPC
receives from the Fund and the advice PFPC receives from counsel,
PFPC may rely upon and follow the advice of counsel. In any such
case, PFPC will use its best efforts to contact the Fund prior to
taking any actions inconsistent with Instructions previously
received by the Fund.
(d) Protection of PFPC. PFPC shall be protected in any action it
takes or does not take in reliance upon directions or advice or
Oral Instructions or Written Instructions it receives from the
Fund or from counsel and which PFPC believes, in good faith, to
be consistent with those directions or advice and Oral
Instructions or Written Instructions. Nothing in this section
shall be construed so as to impose an obligation upon PFPC to
seek such directions or advice or Oral Instructions or Written
Instructions, unless, under the terms of other provisions of this
Agreement, the same is a condition of PFPC's properly taking or
not taking such action.
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7. Records; Visits.
(a) The books and records pertaining to the Fund and the Portfolios
which are in the possession or under the control of PFPC shall be
the property of the Fund. Such books and records shall be
prepared and maintained as required by the 1940 Act and other
applicable securities laws, rules and regulations. The Fund and
Authorized Persons shall have access to such books and records at
all times during PFPC's normal business hours. Upon the
reasonable request of the Fund, copies of any such books and
records shall be provided by PFPC to the Fund or to an Authorized
Person, at the Fund's expense.
(b) PFPC shall keep the following records:
(i) all books and records with respect to each Portfolio's
books of account;
(ii) records of each Portfolio's securities transactions; and
(iii) all other books and records as PFPC is required to maintain
pursuant to Rule 31a-1 of the 1940 Act in connection with
the services provided hereunder.
8. Confidentiality. Each party shall keep confidential any information
relating to the other party's business ("Confidential Information").
Confidential Information shall include (a) any data or information that
is competitively sensitive material, and not generally known to the
public, including, but not limited to, information about product plans,
marketing strategies, finances, operations, customer relationships,
customer profiles, customer lists, sales estimates, business plans, and
internal performance results relating to the past, present or future
business activities of the Fund or PFPC, their respective subsidiaries
and affiliated companies and the customers, clients and suppliers of
any of them; (b) any scientific or technical information, design,
process, procedure, formula, or improvement that is commercially
valuable and secret in the sense that its confidentiality affords the
Fund or PFPC a competitive advantage over its competitors; (c) all
confidential or proprietary concepts, documentation, reports, data,
specifications, computer software, source code, object code, flow
charts, databases, inventions, know-how, and trade secrets, whether or
not patentable or copyrightable; and (d) anything designated as
confidential. Notwithstanding the foregoing, information shall not be
subject to such confidentiality obligations if it: (a) is already known
to the receiving party at the time it is obtained; (b) is or becomes
publicly known or available through no wrongful act of the receiving
party; (c) is rightfully received from a third party who, to the best
of the receiving party's knowledge, is not under a duty of
confidentiality; (d) is released by the protected party to a third
party without restriction; (e) is required to be disclosed by the
receiving party pursuant to a requirement of a court order, subpoena,
governmental or regulatory agency or law (provided the receiving party
will provide the other party both prompt oral and written notice of
such requirement and will to the extent possible coordinate any such
production with the Fund or the Fund's counsel, to the extent such
notice is permitted); (f) is relevant to the defense of any claim or
cause of action asserted against the receiving party; or (g) has been
or is independently developed or obtained by the receiving party. In
accordance with Section 248.11 of Regulation S-P (17 CFR 248.1 -
248.30) ("Reg S-P"), PFPC will not directly, or indirectly through an
affiliate, disclose any non-public personal information, as defined in
Reg S-P, received from the Fund to any person that is not affiliated
with the Fund or with PFPC and provided that any such information
disclosed to an affiliate of PFPC shall be under the same limitations
on non-disclosure.
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9. Liaison with Accountants. PFPC shall act as liaison with the Fund's
independent public accountants and shall provide account analyses,
fiscal year summaries, and other audit-related schedules with respect
to each Portfolio. PFPC shall take all reasonable action in the
performance of its duties under this Agreement to assure that the
necessary information is made available to such accountants for the
expression of their opinion, as required by the Fund.
10. PFPC System. PFPC shall retain title to and ownership of any and all
data bases, computer programs, screen formats, report formats,
interactive design techniques, derivative works, inventions,
discoveries, patentable or copyrightable matters, concepts, expertise,
patents, copyrights, trade secrets, and other related legal rights
utilized by PFPC in connection with the services provided by PFPC to
the Fund; provided, however, that PFPC shall have no right to retain
title to or ownership of any database which consists solely of
information pertaining to the transactions of the Fund or its
shareholders.
11. Disaster Recovery. PFPC shall enter into and shall maintain in effect
with appropriate parties one or more agreements making reasonable
provisions for emergency use of electronic data processing equipment to
the extent appropriate equipment is available. In the event of
equipment failures, PFPC shall, at no additional expense to the Fund,
take reasonable steps to minimize service interruptions. PFPC shall
have no liability with respect to the loss of data or service
interruptions caused by equipment failure, provided such loss or
interruption is not caused by PFPC's own willful misfeasance, bad
faith, gross negligence or reckless disregard of its duties or
obligations under this Agreement.
12. Compensation. As compensation for services rendered by PFPC during the
term of this Agreement, the Fund, on behalf of each Portfolio, will pay
to PFPC a fee or fees as may be agreed to in writing by the Fund and
PFPC.
13. Indemnification. (a) The Fund, on behalf of each Portfolio, agrees to
indemnify and hold harmless PFPC and its affiliates from all taxes,
charges, expenses, assessments, claims and liabilities (including,
without limitation, attorneys' fees and disbursements and liabilities
arising under the Securities Laws and any state and foreign securities
and blue sky laws) arising directly or indirectly from any action or
omission to act which PFPC takes in reliance upon Oral or Written
Instructions received from the Fund or which PFPC is required to take
or refrain from taking in accordance with the provisions of this
Agreement. Neither PFPC, nor any of its affiliates, shall be
indemnified against any liability (or any expenses incident to such
liability) caused by PFPC's or its affiliates' own willful misfeasance,
bad faith, gross negligence or reckless disregard of its duties and
obligations under this Agreement. PFPC shall not make any claim for any
amounts payable by the Fund hereunder except against the relevant
Portfolio's assets and not against the assets of any other investment
portfolio of the Fund.
(b) PFPC agrees to indemnify and hold harmless the Fund and each
Portfolio from all taxes, charges, expenses, assessments, claims and
liabilities (including, without limitation, attorneys' fees and
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disbursements and liabilities arising under the Securities Laws and any
state and foreign securities and blue sky laws) arising directly or
indirectly from any action or omission to act of PFPC in contravention
of the terms of this Agreement or caused by PFPC's willful misfeasance,
bad faith, gross negligence or reckless disregard of its duties and
obligations under this Agreement. Neither the Fund, nor any Portfolio,
shall be indemnified against any liability (or any expenses incident to
such liability) caused by PFPC's following Oral or Written Instructions
which PFPC reasonably believed to have been valid and genuinely given.
PFPC further agrees to indemnify and hold harmless the Fund and the
Portfolios from all taxes, charges, expenses, assessments, claims and
liabilities (including, without limitation, attorneys' fees and
disbursements) arising directly or indirectly from any claim by a third
party against the Fund or a Portfolio with respect to infringement of
any patent or copyright of any goods, services or programs supplied or
used by PFPC (the "PFPC Materials") in connection with the provision of
services to the Fund and the Portfolios hereunder. The foregoing
indemnification obligation shall not apply to any claim based on or
arising from (i) goods, services or programs not owned, developed or
provided by PFPC, (ii) the combination by the Fund or the Portfolios of
the PFPC Materials with any other goods, services or programs not owned
or developed by or on behalf of PFPC, or (iii) the failure of the Fund
or the Portfolios to use the PFPC Materials as authorized or for their
intended purpose.
14. Responsibility of PFPC.
(a) PFPC shall be under no duty to take any action hereunder on
behalf of the Fund or any Portfolio except as specifically set
forth herein (which exception includes the obligation to follow
Oral or Written Instructions provided by the Fund) or as may be
specifically agreed to by PFPC and the Fund in a written
amendment hereto. PFPC shall be obligated to exercise care and
diligence in the performance of its duties hereunder and to act
in good faith in performing services provided for under this
Agreement. PFPC shall be liable only for any damages arising out
of PFPC's failure to perform its duties under this Agreement to
the extent such damages arise out of PFPC's willful misfeasance,
bad faith, gross negligence or reckless disregard of such duties.
(b) Without limiting the generality of the foregoing or of any other
provision of this Agreement, (i) PFPC shall not be liable for
losses beyond its control, including without limitation (subject
to Section 11), delays or errors or loss of data occurring by
reason of circumstances beyond PFPC's control, provided that PFPC
has acted in accordance with the standard set forth in Section
14(a) above; and (ii) PFPC shall not be under any duty or
obligation to inquire into and shall not be liable for the
validity or invalidity or authority or lack thereof of any Oral
Instruction or Written Instruction, notice or other instrument
which conforms to the applicable requirements of this Agreement,
and which PFPC reasonably believes to be genuine.
(c) Notwithstanding anything in this Agreement to the contrary, (i)
neither PFPC nor its affiliates shall be liable for any
consequential, special or indirect losses or damages, unless the
likelihood of such losses or damages was known by PFPC or its
affiliates and PFPC acted without regard to such likely losses or
damages and (ii) PFPC's cumulative liability to the Fund for all
losses, claims, suits, controversies, breaches or damages for any
cause whatsoever (including but not limited to those arising out
of or related to this Agreement) and regardless of the form of
action or legal theory shall not exceed the lesser of $100,000 or
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the fees received by PFPC for services provided hereunder during
the 12 months immediately prior to the date of such loss or
damage; provided, however, that any liability (or any expenses
incident to such liability) caused by PFPC's or its affiliates'
own willful misfeasance, bad faith, gross negligence or reckless
disregard of its duties and obligations under this Agreement
shall not be subject to the foregoing cap on liability.
(d) No party may assert a cause of action against PFPC or any of its
affiliates that allegedly occurred more than 60 months
immediately prior to the filing of the suit (or, if applicable,
commencement of arbitration proceedings) alleging such cause of
action.
(e) Each party shall have a duty to mitigate damages for which the
other party may become responsible.
15. Description of Accounting Services on a Continuous Basis.
PFPC will perform the following accounting services with respect to
each Portfolio:
(i) Journalize investment, capital share and income and expense
activities;
(ii) Verify investment buy/sell trade tickets when received from the
investment adviser for a Portfolio (the "Adviser") and transmit
trades to the Fund's custodian (the "Custodian") for proper
settlement, provided PFPC Trust Company serves as the Fund's
custodian;
(iii) Maintain individual ledgers for investment securities;
(iv) Maintain historical tax lots for each security;
(v) Reconcile cash and investment balances of the Fund with the
Custodian, and provide the Adviser with the beginning cash
balance available for investment purposes no later th a.m.
Pacific time;
(vi) Update the cash availability throughout the day as required by
the Adviser;
(vii) Post to and prepare the Statement of Assets and Liabilities and
the Statement of Operations;
(viii) Calculate various contractual expenses (e.g., advisory and
custody fees);
(ix) Monitor the expense accruals and notify an officer of the Fund of
any proposed adjustments;
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(x) Control all disbursements and authorize such disbursements upon
Written Instructions;
(xi) Calculate capital gains and losses;
(xii) Determine net income;
(xiii) Obtain security market quotes from independent pricing services
approved by the Adviser, or if such quotes are unavailable,
then obtain such prices from the Adviser, and in either case
calculate the market value of each Portfolio's Investments; to
the extent that there are no market quotations readily
available for a security in the Fund's portfolios, PFPC will
immediately advise the Adviser of such fact and will coordinate
determination of fair market value with the Fund and the
Adviser;
(xiv) Transmit or mail a copy of the daily portfolio valuation to the
Adviser;
(xv) Compute net asset value; and
(xvi) As appropriate, or requested, compute yields, total return,
expense ratios, portfolio turnover rate, and, if required,
portfolio average dollar-weighted maturity.
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16. Description of Administration Services on a Continuous Basis.
PFPC will perform the following administration services with respect to
each Portfolio:
(i) Prepare quarterly broker security transactions summaries;
(ii) Prepare monthly security transaction listings;
(iii) Supply various normal and customary Portfolio and Fund
statistical data as requested on an ongoing basis;
(iv) Prepare for execution, review with the Fund's Chief Financial
Officer, and file the Fund's Federal and state tax returns;
(v) Monitor each Portfolio's status as a regulated investment
company under Sub-chapter M of the Internal Revenue Code of
1986, as amended;
(vi) Prepare, coordinate with the Fund and the Fund's counsel, and
file with the SEC the Fund's annual, semi-annual, and quarterly
shareholder reports;
(vii) Prepare, coordinate with the Fund's counsel and file with the
SEC Post-Effective Amendments to the Fund's Registration
Statement, prepare reports to the SEC including, the
preparation and filing of (i) semi-annual reports on Form N-SAR
and (ii) Notices pursuant to Rule 24f-2;
(viii) Assist in the preparation of notices of Annual or Special
Meetings of Shareholders and Proxy materials relating to such
meetings;
(ix) Assist in obtaining the fidelity bond and directors' and
officers'/errors and omissions insurance policies for the Fund
in accordance with the requirements of Rule 17g-1 and
17d-1(d)(7) under the 1940 Act as such bond and policies are
approved by the Fund's Board of Trustees;
(x) Monitor the Fund's assets to assure adequate fidelity bond
coverage is maintained;
(xi) Draft agendas, resolutions and materials for quarterly and
special Board meetings;
(xii) Coordinate the preparation, assembly and mailing of Board
materials;
(xiii) Maintain the Fund's corporate calendar to assure compliance
with various filing and Board approval deadlines;
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(xiv) Coordinate contractual relationships and communications between
the Fund and its contractual service providers; and
(xv) Monitor the Fund's compliance with the amounts and conditions
of each state qualification.
17. Duration and Termination. This Agreement shall continue until
terminated by the Fund or by PFPC on sixty (60) days' prior written
notice to the other party. In the event the Fund gives notice of
termination, all reasonable expenses associated with movement (or
duplication) of records and materials and conversion thereof to a
successor accounting and administration services agent(s) (and any
other service provider(s)), and all reasonable trailing expenses
incurred by PFPC, will be borne by the Fund. In the event that PFPC
gives notice of termination, all reasonable expenses associated with
movement (or duplication) of records and materials and conversion
thereof to a successor accounting and administration services agent(s)
(and any other service provider(s)), and all reasonable trailing
expenses incurred by PFPC, will be borne by PFPC. In the event of
termination, PFPC agrees that it will cooperate in the smooth
transition of services and to minimize disruption to the Fund and its
shareholders.
18. Notices. Notices shall be addressed (a) if to PFPC, at 000 Xxxxxxxx
Xxxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000, Attention: President; (b) if to
the Fund, at 0000 Xxxxxxx Xxxxx, Xxxx xx Xxxxxxx XX 00000,
Attention:Xxxx Xxxxxxx or (c) if to neither of the foregoing, at such
other address as shall have been given by like notice to the sender of
any such notice or other communication by the other party. If notice is
sent by confirming telegram, cable, telex or facsimile sending device,
it shall be deemed to have been given immediately. If notice is sent by
first-class mail, it shall be deemed to have been given three days
after it has been mailed. If notice is sent by messenger, it shall be
deemed to have been given on the day it is delivered.
19. Amendments. This Agreement, or any term thereof, may be changed or
waived only by written amendment, signed by the party against whom
enforcement of such change or waiver is sought.
20. Delegation; Assignment. PFPC may assign its rights and delegate its
duties hereunder to any majority-owned direct or indirect subsidiary of
PFPC or PNC Bank Corp., provided that PFPC gives the Fund 90 days prior
written notice of such assignment or delegation.
21. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
22. Further Actions. Each party agrees to perform such further acts and
execute such further documents as are necessary to effectuate the
purposes hereof.
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23. Miscellaneous.
(a) Notwithstanding anything in this Agreement to the contrary, the
Fund agrees not to make any modifications to its registration
statement or adopt any policies which would affect materially
the obligations or responsibilities of PFPC hereunder without
the prior written approval of PFPC, which approval shall not be
unreasonably withheld or delayed.
(b) Except as expressly provided in this Agreement, PFPC hereby
disclaims all representations and warranties, express or
implied, made to the Fund or any other person, including,
without limitation, any warranties regarding quality,
suitability, merchantability, fitness for a particular purpose
or otherwise (irrespective of any course of dealing, custom or
usage of trade), of any services or any goods provided
incidental to services provided under this Agreement.
(c) This Agreement embodies the entire agreement and understanding
between the parties and supersedes all prior agreements and
understandings relating to the subject matter hereof, provided
that the parties may embody in one or more separate documents
their agreement, if any, with respect to delegated duties. The
captions in 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. Notwithstanding any provision hereof, the services of
PFPC are not, nor shall they be, construed as constituting
legal advice or the provision of legal services for or on
behalf of the Fund or any other person.
(d) 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.
(e) If any provision of this Agreement shall be held or made
invalid by a court decision, statute, rule or otherwise, the
remainder of this Agreement shall not be affected thereby. This
Agreement shall be binding upon and shall inure to the benefit
of the parties hereto and their respective successors and
permitted assigns.
(f) The facsimile signature of any party to this Agreement shall
constitute the valid and binding execution hereof by such
party.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and year first above written.
PFPC INC.
By: /s/ Xxxxxxx X. Xxxxx
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Title: Executive Vice President
McM FUNDS
By: /s/ Xxxxx X. Xxxxxx
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Title: Secretary
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EXHIBIT A
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THIS EXHIBIT A, dated as of July 1, 2000 is Exhibit A to that certain
Administration and Accounting Services Agreement dated as of July 1, 2000
between PFPC Inc. and McM Funds.
PORTFOLIOS
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McM Principal Preservation Fund
McM Intermediate Fixed Income Fund
McM Fixed Income Fund
McM Balanced Fund
McM Equity Investment Fund
McM S&P 500 Index Fund
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