Exhibit 99.(h)(6)
FUND ADMINISTRATION SERVICING AGREEMENT
THIS AGREEMENT is made and entered into on this 5th day of January, 2005,
by and between Xxxxx and Power Growth Fund, Inc., a corporation organized under
the laws of the State of Minnesota (the "Fund"), and Xxxxx and Power, Inc. (the
"Administrator").
WHEREAS, the Fund is an open-ended management investment company
registered under the Investment Company Act of 1940, as amended (the "Investment
Company Act"); and
WHEREAS, the Fund and the Administrator desire to enter into this
Agreement to set forth the terms and conditions under which the Administrator
provides fund administration services for the benefit of the Fund.
NOW, THEREFORE, the Fund and the Administrator do mutually promise and
agree as follows:
I. APPOINTMENT OF ADMINISTRATOR
The Fund hereby appoints the Administrator as administrator of the Fund on
the terms and conditions set forth in this Agreement, and the Administrator
hereby accepts such appointment and agrees to perform the duties and
responsibilities set forth in this Agreement in consideration of the
compensation provided for herein.
II. DUTIES AND RESPONSIBILITIES OF THE ADMINISTRATOR
The Administrator shall perform the following duties and responsibilities
on behalf of the Fund:
A. GENERAL FUND MANAGEMENT
1. Act as liaison among all Fund service providers.
2. Provide appropriate personnel, office facilities, information
technology, record keeping and other resources as necessary
for the Administrator to perform its duties and
responsibilities under this Agreement.
3. Coordinate board activities by:
a. Assisting in establishing meeting agendas.
b. Preparing board reports based on financial and
administrative data.
c. Securing and monitoring director and officers liability
coverage.
4. Coordinate shareholder meetings by:
a. Assisting in the preparation and mailing of shareholder
communications, including proxy materials.
b. Assisting with the scheduling and conduct of shareholder
meetings.
5. Assist in the overall operations of the Fund.
B. COMPLIANCE
1. Investment Company Act Compliance
a. Assist in updating and monitoring compliance with the
Fund's policies and procedures adopted pursuant to Rule
38a-l of the Investment Company Act (the "Fund's
Policies and Procedures").
b. Employ the services of a person to act in the capacity
of Chief Compliance Officer of the Fund, who shall be
responsible for administering the Fund's Policies and
Procedures.
c. Periodically monitor compliance with Investment Company
Act requirements, including:
(1) Asset diversification tests
(2) Total return and yield calculations
(3) Maintenance of books and records under Rule 31a-3
(4) Code of ethics
d. Periodically monitor Fund's compliance with the policies
and investment limitations of the Fund as set forth in
its prospectus and statement of additional information.
2. SEC Registration and Reporting
a. Assist in updating the prospectus and statement of
additional information.
b. Assist in preparing annual, semiannual and quarterly
reports to shareholders.
c. Assist in preparing and filing all forms required to be
filed by the Fund with the SEC, including:
(1) Form N-lA
(2) Form N-SAR
(3) Form N-CSR
(4) Form 24f-2
(5) Form N-Q
(6) Form N-PX
(7) Schedule 13G
3 IRS Compliance
a. Periodically monitor the Fund's status as a registered
investment company under Subchapter M:
2
(1) Asset diversification requirements
(2) Qualifying income requirements
(3) Distribution requirements
b. Calculate required distributions to shareholders.
C. FINANCIAL REPORTING AND AUDITS
1. Supervise the Fund's custodian and accountants in the
maintenance of the Fund's general ledger and in the
preparation of the Fund's financial statements, including
oversight of expense accruals and payments, the determination
of the Fund's net asset value, and the declaration and payment
of dividends and other distributions to shareholders.
2. Provide financial data required for the Fund's prospectus and
statement of additional information and quarterly and
semi-annual reports to shareholders.
3. Provide information to the Fund's independent auditors to
facilitate the audit process.
4. Prepare financial and statistical reports, as requested by the
board.
D. TAX REPORTING
1. Assist with the preparation and filing of appropriate federal
and state tax returns including forms 1120/8610 with any
necessary schedules.
2. Prepare state income breakdowns where relevant.
3. File 1099 Miscellaneous for payments to directors and other
service providers.
4. Calculate eligible dividend income.
III. COMPENSATION
The Fund agrees to pay the Administrator for performance of the duties
listed in this Agreement the fees and out-of-pocket expenses set forth in the
attached Schedule A.
These fees may be changed from time to time, subject to mutual written
agreement between the Fund and the Administrator.
The Fund agrees to pay all fees and reimbursable expenses within ten (10)
business days following the mailing of the billing notice.
3
IV. PERFORMANCE OF SERVICE; LIMITATION OF LIABILITY
A. The Administrator shall exercise reasonable care in the performance
of its duties under this Agreement. The Administrator shall not be
liable for any error of judgment or mistake of law or for any loss
suffered by the Fund in connection with matters to which this
Agreement relates, including losses resulting from failure of
computing or communication equipment or power supplies beyond the
Administrator's control, except a loss resulting from the
Administrator'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.
The Administrator shall take all reasonable steps to minimize
service interruptions and will make every reasonable effort to
restore any lost or damaged data and correct any errors resulting
from such interruptions at the expense of the Administrator. The
Administrator agrees that it shall, at all times, have reasonable
contingency plans with appropriate parties, making reasonable
provision for emergency use of data processing equipment to the
extent appropriate equipment is available. Representatives of the
Fund shall be entitled to inspect the Administrator's premises and
operating capabilities at any time during regular business hours of
the Administrator, upon reasonable notice to the Administrator.
The Fund shall indemnify and hold the Administrator 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
Administrator may sustain or incur or which may be asserted against
the Administrator 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 the Administrator by any
duly authorized officer of the Fund.
B. The Administrator shall indemnify and hold the Fund 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 Fund by any person arising out of any action
taken or omitted to be taken by the Administrator as a result of the
Administrator's refusal or failure to comply with the terms of this
Agreement, its bad faith, negligence, or willful misconduct.
C. If a party hereto (the "Indemnifying Party") is asked to indemnify
or hold the other party hereto harmless (the "Indemnified Party"),
the Indemnifying Party shall be fully and promptly advised of all
pertinent facts concerning the situation in question, and the
Indemnified Party will use all reasonable care to notify the
Indemnifying Party promptly concerning any situation which presents
or appears likely to present the likelihood of a claim for
indemnification against the
4
Indemnifying Party. The Indemnifying Party shall have the option to
defend the Indemnified Party against any claim which may be the
subject of this indemnification. In the event that the Indemnifying
Party so elects, it will so notify the Indemnified Party and
thereupon the Indemnifying Party shall take over complete defense of
the claim, and the Indemnified Party shall in such situation
initiate no further legal or other expenses for which it shall seek
indemnification under this section. The Indemnified Party shall in
no case confess any claim or make any compromise in any case in
which the Indemnifying Party will be asked to indemnify the
Indemnified Party except with the Indemnifying Party's prior written
consent.
V. CONFIDENTIALITY
The Administrator shall maintain in strict confidence all information
relating to the Fund's business which is received by the Administrator during
the course of rendering any service hereunder.
VI. DATA NECESSARY TO PERFORM SERVICE
The Fund and its agents shall furnish to the Administrator the data
necessary to perform the services described herein at times and in such form as
mutually agreed upon.
VII. RECORDS
The Administrator 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 Fund but not inconsistent with the rules and
regulations of appropriate government authorities, including Section 31 of the
Investment Company Act and the rules thereunder. The Administrator agrees that
all such records prepared or maintained by the Administrator relating to the
services to be performed by the Administrator hereunder are the property of the
Fund and will be preserved, maintained, and made available in accordance with
the Investment Company Act and the rules thereunder, and will be promptly
surrendered to the Fund on and in accordance with its request.
VIII. TERMS OF AGREEMENT
This Agreement shall become effective as of the date hereof and, unless
sooner terminated as provided herein, shall continue automatically in effect for
successive annual periods. The Agreement may be terminated by either party upon
giving sixty (60) days prior written notice to the other party or such shorter
period as is mutually agreed upon by the parties.
IX. DUTIES IN THE EVENT OF TERMINATION
If a successor to any of the Administrator's duties or responsibilities
hereunder is designated by the Fund by written notice to the Administrator, the
Administrator will promptly transfer to such successor all relevant books,
records, correspondence, and other data established or maintained by the
Administrator under this Agreement in a form reasonably acceptable to the Fund
and will cooperate in the transfer of such duties and responsibilities,
including provision
5
for assistance from the Administrator's personnel in the establishment of books,
records, and other data by such successor.
X. CHOICE OF LAW
This Agreement shall be construed in accordance with the laws of the State
of Minnesota.
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 to the attention of
an officer of the relevant party at such party's principal business address or
at such other location as such party may designate.
In witness whereof, the parties have duly executed this Agreement as of
the day and year first above written.
XXXXX AND POWER GROWTH FUND, INC. XXXXX AND POWER, INC.
By: /s/ Xxxxxxx X. Xxxxx By: /s/ Xxxxxx X. Xxxxx
--------------------------------- -----------------------------------
Its: President Its: Chairman
-------------------------------- ----------------------------------
6
SCHEDULE A
FEES AND EXPENSES PAYABLE UNDER
FUND ADMINISTRATION SERVICING AGREEMENT
PAYMENT PERIOD AMOUNT OF FEES
-------------- --------------
Payable in arrears within 10 days Computed at an annual rate of 0.01%
after the end of each month. based upon the Fund's average daily
net assets.
In addition to the fees set forth above, the Administrator shall be entitled to
reimbursement of out-of-pocket expenses incurred directly in providing the
services under the Agreement. Examples of such direct expenses include filing,
mailing and printing costs for prospectuses, shareholder reports and SEC
filings.
7
