1
EXHIBIT 99.B9a
FUND ADMINISTRATION SERVICING AGREEMENT
This Agreement is made and entered into on this 2nd day of February, 1998, by
and between The Xxxxxxx Funds, a business trust organized under the laws of the
State of Delaware (hereinafter referred to as the "Trust") on behalf of any of
its series as described in Part IV of this Agreement (each such series is
hereafter referred to as a "Fund" and, collectively as the "Funds"), and Firstar
Trust Company, a corporation organized under the laws of the State of Wisconsin
(hereinafter referred to as "FTC").
WHEREAS, The Trust is a open-ended management investment company which is
registered under the Investment Company Act of 1940 (as amended, the "1940
Act");
WHEREAS, FTC is a trust company and, among other things, is in the business of
providing fund administration services for the benefit of its customers;
NOW, THEREFORE, the Trust and FTC do mutually promise and agree as follows:
I. Appointment of Administrator
The Trust hereby appoints FTC as Administrator of the Funds on the
terms and conditions set forth in this Agreement, and FTC 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.
II. Duties and Responsibilities of FTC
A. General Fund Management
1. Act as liaison among all fund service providers
2. Coordinate corporate formalities and Board communication by:
a. preparing and distributing meeting agendas and board
materials including board resolutions and various
financial, administrative and regulatory reports;
b. attending all regular or special board meetings,
preparing and distributing minutes of such meetings
and maintaining the corporate records and minute book
for the Trust;
c. updating trustees' and officers' biographical
information and questionnaires; and
d. evaluating independent auditor.
2
3. Audits
a. Prepare appropriate schedules and assist independent
auditors
b. Provide information to SEC and facilitate audit
process
c. Provide office facilities for auditors and SEC staff
as appropriate
4. Assist in overall operations of the Trust, including the
provision of office facilities, executive and administrative
services and FTC personnel to serve as officers of the Trust
to facilitate Trust operations, all at FTC's expense with
the exception of the costs incurred when attending Board of
Trustee meetings; and to provide stationary and office
supplies at the Trust's expense.
5. Create and maintain operations and compliance calendars
and/or a compliance manual for the Trust, detailing
schedules for the various responsibilities of FTC.
6. Shareholder Communications. Coordinate printing and
distribution of prospectuses, statements of additional
information, stickers (supplements) to prospectuses or
statements of additional information, annual and semi-annual
shareholder reports and proxy statements.
B. Compliance
1. Regulatory Compliance
a. periodically monitor compliance with 1940 Act
requirements, including:
1) Asset diversification tests;
2) Total return and yield calculations;
3) Code of ethics
4) Compliance with fidelity bond coverage
requirements of Rule 17g-1 under the 1940 Act;
and
5) Compliance with the NASD sales charge rule,
including the calculation and monitoring of the
sales charge cap and remaining amount for
asset-based sales charges.
b. Periodically monitor and report at Fund's quarterly
board meeting or more frequently as required,
compliance with the policies investment limitations
and reinvestment restrictions of each Fund as set
forth in its prospectus and statement of additional
information
2
3
2. Blue Sky Compliance
a. Prepare and file with the appropriate state securities
authorities any and all required compliance or notice
filings relating to the sales, qualification or
registration of the securities of each Fund so as to
enable each Fund to make a continuous offering of its
shares in the fifty states, Puerto Rico, U.S. Virgin
Islands, and Guam ("Blue Sky Jurisdictions").
b. Monitor sales and qualification status and make
appropriate renewal filings in each Blue Sky
Jurisdiction.
c. File prospectuses, statements of additional
information or proxy statements for the Trust in Blue
Sky Jurisdictions as requested by the Trust or such
jurisdictions.
3. SEC Registration and Reporting
a. Assist in the preparation and filing of post-effective
amendments to the Trust's Registration Statement on
Form N-1A to reflect the addition or deletion of
Funds, general amendments, or annual updates including
the preparation of Financial Data Schedules; and
prepare and file supplements ("stickers") to any
prospectus or statement of additional information for
a Fund;
b. Prepare and file annual and semi-annual reports to
shareholders as required under the 1940 Act, along
with annual and semiannual reports on Form N-SAR
(which shall be series and class-specific, as
appropriate);
c. Assist in the preparation and filing of proxy
statements, as requested by the Trust (matters to be
voted on may be class-specific), prepare minutes of
shareholder meetings, and record ballot results and
interface with proxy solicitation companies as
required;
d. Prepare and file documents required to report and
calculate Federal securities registration fees (such
as notices on Form 24F-2);
e. File fidelity bond and any joint insurance agreements
as required by Rule 17g-1 under the 1940 Act; and
f. Provide for the XXXXX-ization or other appropriate
preparation of all documents described above which
must be filed electronically with the SEC.
3
4
4. IRS Compliance
a. Periodically monitor the Trust's status as a regulated
investment company under Subchapter M of the Internal
Revenue Code, as amended, through review of the
following:
1) Asset diversification requirements
2) Qualifying income requirements
3) Distribution requirements
b. Monitor short short testing as required
c. Calculate required distributions as required
(including excise tax distributions)
C. Financial Reporting
1. Prepare monthly expense reports (by series and class where
appropriate) including expense figures and accruals,
monitoring of expense caps or reimbursements and calculation
of advisory fees and 12b-1 accruals or payments; and
calculate expense ratios for quarterly, semiannual or annual
periods.
2. Prepare unaudited financial statements (by series and class
where appropriate) for use in shareholder reports or
prospectuses and statements of additional information.
3. Prepare other monthly operational reports as required
including:
a. Sales figures (including shares sold, redeemed and
reinvested, changes in share price in net sales and
numbers of shareholders);
b. Performance information (including total return or
yield for the month, quarter, year-to-date, fiscal
year or average annual one-, five- or ten-year
periods); and
c. Portfolio information (including turnover, top ten
holdings, book gains/losses per share; net income/book
income per share; basis).
4. Provide financial data required by Fund prospectus and
statements of additional information
5. Prepare financial reports for shareholders, the board, the
SEC, and independent auditors
4
5
6. Supervise the Trust's Custodian and Fund Accountants in the
maintenance of each Fund's general ledger and in the
preparation of each Fund's financial statements including
oversight of expense accruals and payments, of the
determination of net asset value of each Fund and of the
Fund's shares, and of the declaration and payment of
dividends and other distributions to shareholders
D. Tax Reporting
1. Prepare and file on a timely basis appropriate federal and
state tax returns including forms 1120/8613 with any
necessary schedules
2. Prepare state income breakdowns where relevant
3. File 1099 Miscellaneous for payments to directors and other
service providers
4. Monitor wash losses
5. Calculate eligible dividend income for corporate
shareholders
III. Compensation
The Trust agrees to pay FTC for performance of the duties listed in
this Agreement and the fees and out-of-pocket expenses as set forth in
the attached Schedule A.
These fees may be changed from time to time, subject to mutual written
Agreement between the Trust and FTC.
The Trust agrees to pay all fees and reimbursable expenses within ten
(10) business days following the mailing of the billing notice.
IV. Additional Funds
In the event that the Trust establishes one or more Funds with respect
to which it desires to have FTC render fund administration services,
under the terms hereof, it shall so notify FTC in writing, and if FTC
agrees in writing to provide such services, such Funds will be subject
to the terms and conditions of this Agreement, and shall be maintained
and accounted for by FTC on a discrete basis. The Funds currently
covered by this Agreement are: The Xxxxxxx Financial Alert Fund
V. Performance of Service; Limitation of Liability
A. FTC shall exercise reasonable care in the performance of
its duties under this Agreement. FTC shall not be liable
for any loss suffered by the Fund in connection with
matters to which this Agreement relates, including losses
resulting from mechanical breakdowns or the failure of
communication or
5
6
power supplies beyond FTC's control, except a loss
resulting from FTC'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, the Fund shall indemnify and
hold harmless FTC 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 FTC may
sustain or incur or which may be asserted against FTC by
any person arising out of any action taken or omitted to be
taken by it in performing the services hereunder (i) in
accordance with the foregoing standards, or (ii) in
reliance upon any written or oral instruction provided to
FTC by any duly authorized officer of the Trust, such duly
authorized officer to be included in a list of authorized
officers furnished to FTC and as amended from time to time
in writing by resolution of the Board of Trustees of the
Trust.
In the event of a mechanical breakdown or failure of
communication or power supplies beyond its control, FTC
shall take all reasonable steps to minimize service
interruptions for any period that such interruption
continues beyond FTC's control. FTC 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 FTC. FTC agrees that it shall, at all times,
have contingency plans, that are comparable to those
employed within the financial services industry, 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
FTC's premises and operating capabilities at any time
during regular business hours of FTC, upon reasonable
notice to FTC.
Regardless of the above, FTC 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 Trust may be asked to indemnify or hold FTC
harmless, the Trust shall be fully and promptly advised of
all pertinent facts concerning the situation in question,
and it is further understood that FTC will use all
reasonable care to notify the Trust promptly concerning any
situation which presents or appears likely to present the
probability of such a claim for indemnification against the
Trust. The Trust shall have the option to defend FTC
against any claim which may be the subject of this
indemnification. In the event that the Trust so elects, it
will so notify FTC and thereupon the Trust shall take over
complete defense of the claim, and FTC shall in such
situation initiate no further legal or other expenses for
which it shall seek indemnification under this section. FTC
shall in no case confess any claim or make any compromise
in any case in which the Trust will be asked to indemnify
FTC except with the Trust's prior written consent.
6
7
C. FTC 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 may be asserted against the Trust by any person
arising out of any action taken or omitted to be taken by
FTC as a result of FTC's refusal or failure to comply with
the terms of this Agreement, its bad faith, negligence, or
willful misconduct.
VI. Confidentiality
FTC shall handle, in confidence, all information relating to the
Trust's business which is received by FTC during the course of
rendering any service hereunder.
VII. Data Necessary to Perform Service
The Trust or its agent, which may be FTC, shall furnish to FTC the data
necessary to perform the services described herein at times and in such
form as mutually agreed upon.
VIII. Terms of Agreement
This Agreement shall become effective on February 2, 1998 and, unless
sooner terminated as provided herein, shall continue automatically in
effect for successive annual periods, provided that the continuance of
the Agreement is approved by a majority of the Trustees of the Trust.
The Agreement may also 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 and will terminate
automatically on its assignment unless the parties hereto consent in
writing.
IX. Duties in the Event of Termination
In the event that, in connection with termination, a successor to any
of FTC's duties or responsibilities hereunder is designated by the
Trust by written notice to FTC, FTC 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 FTC under this Agreement in a form reasonably
acceptable to the Trust (if such form differs from the form in which
FTC 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 FTC's personnel in the establishment of books, records, and other
data by such successor.
7
8
X. Choice of Law
This Agreement shall be construed in accordance with the laws of the
State of Wisconsin.
XI. 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 FTC shall be sent to:
Firstar Trust Company
000 Xxxx Xxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
and notice to the Trust shall be sent to:
The Olstein Funds
Four Xxxxxxxxxxxxxx Xxxx
Xxxxxxxx, XX 00000
XII. Records
FTC 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 and as required by the rules
and regulations of appropriate government authorities, in particular,
Section 31 of the 1940 Act and the rules thereunder. FTC agrees that
all such records prepared or maintained by FTC relating to the services
to be performed by FTC hereunder are the property of the Trust and will
be preserved, maintained, and made available with such section and
rules of the 1940 Act and will be promptly surrendered to the Trust on
and in accordance with its request.
The Xxxxxxx Funds Firstar Trust Company
Sign: /s/ Xxxxxx X. Xxxxxxx Sign: /s/ Xxx Xxxxxxx
------------------------------ -------------------------------
Print: Xxxxxx X. Xxxxxxx Print: Xxx Xxxxxxx
----------------------------- ------------------------------
Title: Chairman and President Title:
----------------------------- ------------------------------
Date: March 2, 1998 Date: March 2, 1998
------------------------------ -------------------------------
Attest: Xxxxxxx Xxxxx Attest: Xxxx Xxxxxxxx
---------------------------- -----------------------------
8
9
Mutual Fund Services
================================================================================
FUND ADMINISTRATION AND COMPLIANCE
ANNUAL FEE SCHEDULE
o Minimum annual fee per Fund: $30,000
o 6 basis points (.0006) on the first $200,000,000 of average daily net
assets
o 5 basis points (.0005) on the next $300,000,000 of average daily net assets
o 3 basis points (.0003) on the balance of average daily net assets in excess
of $500,000,000
o Out-of-Pocket expenses, including, but not limited to:
o Postage
o Stationary
o Programming
o Proxies
o Retention of records
o Special reports
o Federal and state regulatory filing fees
o Certain insurance premiums
o All other out-of-pocket expenses
o Expenses from Board of Trustees meetings
o Fees are billed monthly
================================================================================
12.8.0 FIRSTAR
9
