Exhibit 8(a)
ADMINISTRATION AGREEMENT
AGREEMENT, dated September 29, 2006, between CMA Government Securities
Fund (the "Fund"), a Massachusetts business trust, and BlackRock Advisors, LLC
(the "Administrator"), a Delaware limited liability company.
WHEREAS, the Administrator has agreed to furnish administration services
to the Fund, an open-end management investment company registered under the
Investment Company Act of 1940, as amended (the "1940 Act");
WHEREAS, the Fund is one of the "feeder" funds for and invests all of its
assets in Master Government Securities Trust, which serves as the "master"
portfolio and has the same investment objective and policies as the Fund;
WHEREAS, this Agreement has been approved in accordance with the
provisions of the 1940 Act, and the Administrator is willing to furnish such
services upon the terms and conditions herein set forth;
NOW, THEREFORE, in consideration of the mutual premises and covenants
herein contained and other good and valuable consideration, the receipt of which
is hereby acknowledged, it is agreed by and between the parties hereto as
follows:
1. In General. The Administrator agrees, all as more fully set forth
herein, to act as administrator to the Fund and to supervise and arrange for the
day today operations of the Fund.
2. Duties and Obligations of Administrator with Respect to the
Administration of the Fund. The Administrator agrees to furnish office
facilities and equipment and clerical, bookkeeping and administrative services
(other than such services, if any, provided by the Fund's Custodian, Transfer
Agent and Dividend Disbursing Agent and other service providers) for the Fund.
To the extent requested by the Fund, the Administrator agrees to provide the
following administrative services:
(a) Oversee the determination and publication of the Fund's net
asset value in accordance with the Fund's policy as adopted from time to time by
the Board of Trustees;
(b) Oversee the maintenance by the Fund's Custodian and Transfer
Agent and Dividend Disbursing Agent of certain books and records of the Fund as
required under Rule 31a1(b)(4) of the 1940 Act and maintain (or oversee
maintenance by such other persons as approved by the Board of Trustees) such
other books and records required by law or for the proper operation of the Fund;
(c) Oversee the preparation and filing of the Fund's federal, state
and local income tax returns and any other required tax returns;
(d) Review the appropriateness of and arrange for payment of the
Fund's expenses;
(e) Prepare for review and approval by officers of the Fund
financial information for the Fund's semiannual and annual reports, proxy
statements and other communications with shareholders required or otherwise to
be sent to Fund shareholders, and arrange for the printing and dissemination of
such reports and communications to shareholders;
(f) Prepare for review by an officer of the Fund the Fund's periodic
financial reports required to be filed with the Securities and Exchange
Commission ("SEC") on Form N-SAR, Form N-CSR, Form N-PX, Form N-Q, and such
other reports, forms and filings, as may be mutually agreed upon;
(g) Prepare such 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 custodian, counsel or auditors;
(h) Make such reports and recommendations to the Board of Trustees
concerning the performance of the independent accountants as the Board of
Trustees may reasonably request or deems appropriate;
(i) Make such reports and recommendations to the Board of Trustees
concerning the performance and fees of the Fund's Custodian and Transfer and
Dividend Disbursing Agent as the Board of Trustees may reasonably request or
deems appropriate;
(j) Oversee and review calculations of fees paid to the Fund's
service providers;
(k) Oversee the Fund's portfolio and perform necessary calculations
as required under Section 18 of the 1940 Act;
(l) Consult with the Fund's officers, independent accountants, legal
counsel, custodian, accounting agent and transfer and dividend disbursing agent
in establishing the accounting policies of the Fund and monitor financial and
shareholder accounting services;
(m) Determine the amounts available for distribution as dividends
and distributions to be paid by the Fund to its shareholders; prepare and
arrange for the printing of dividend notices to shareholders; and provide the
Fund's dividend disbursing agent and custodian with such information as is
required for such parties to effect the payment of dividends and distributions
and to implement the Fund's dividend reinvestment plan;
(n) Prepare such information and reports as may be required by any
banks from which the Fund borrows funds;
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(o) Provide such assistance to the Custodian and the Fund's counsel
and auditors as generally may be required to properly carry on the business and
operations of the Fund;
(p) Respond to or refer to the Fund's officers or transfer agent,
shareholder (including any potential shareholder) inquiries relating to the
Fund; and
(q) Supervise any other aspects of the Fund's administration as may
be agreed to by the Fund and the Administrator.
All services are to be furnished through the medium of any directors,
officers or employees of the Administrator or its affiliates as the
Administrator deems appropriate in order to fulfill its obligations hereunder.
The Fund will reimburse the Administrator or its affiliates for all out of
pocket expenses incurred by them in connection with the performance of the
administrative services described in this paragraph 2. The Fund will reimburse
the Administrator and its affiliates for their costs in providing accounting
services to the Fund.
3. Covenants. (a) In the performance of its duties under this Agreement,
the Administrator shall at all times conform to, and act in accordance with, any
requirements imposed by: (i) the provisions of the 1940 Act and the Investment
Advisers Act of 1940, as amended, and all applicable Rules and Regulations of
the Securities and Exchange Commission; (ii) any other applicable provision of
law; (iii) the provisions of the Declaration of Trust and By Laws of the Fund,
as such documents are amended from time to time; (iv) the investment objectives
and policies of the Fund as set forth in its Registration Statement on Form N-1A
and/or the resolutions of the Board of Trustees; and (v) any policies and
determinations of the Board of Trustees of the Fund and
(b) In addition, the Administrator will treat confidentially and as
proprietary information of the Fund all records and other information relative
to the Fund, and the Fund's prior, current or potential shareholders, and will
not use such records and information for any purpose other than performance of
its responsibilities and duties hereunder, except after prior notification to
and approval in writing by the Fund, which approval shall not be unreasonably
withheld and may not be withheld where the Administrator 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 Fund.
4. Services Not Exclusive. Nothing in this Agreement shall prevent the
Administrator or any officer, employee or other affiliate thereof from acting as
administrator for any other person, firm or corporation, or from engaging in any
other lawful activity, and shall not in any way limit or restrict the
Administrator or any of its officers, employees or agents from buying, selling
or trading any securities for its or their own accounts or for the accounts of
others for whom it or they may be acting; provided, however, that the
Administrator will undertake no activities which, in its judgment, will
adversely affect the performance of its obligations under this Agreement.
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5. Books and Records. In compliance with the requirements of Rule 31a-3
under the 1940 Act, the Administrator hereby agrees that all records which it
maintains for the Fund are the property of the Fund and further agrees to
surrender promptly to the Fund any such records upon the Fund's request. The
Administrator further agrees to preserve for the periods prescribed by Rule
31a-2 under the 1940 Act the records required to be maintained by Rule 31a-1
under the 1940 Act.
6. Expenses. During the term of this Agreement, the Administrator will
bear all costs and expenses of its employees and any overhead incurred in
connection with its duties hereunder and shall bear the costs of any salaries or
trustees' fees of any officers or trustees of the Fund who are affiliated
persons (as defined in the 0000 Xxx) of the Administrator; provided that the
Board of Trustees of the Fund may approve reimbursement to the Administrator of
the pro rata portion of the salaries, bonuses, health insurance, retirement
benefits and all similar employment costs for the time spent on Fund operations,
(including, without limitation, compliance matters) (other than the provision of
administrative services required to be provided hereunder) of all personnel
employed by the Administrator who devote substantial time to Fund operations or
the operations of other investment companies administered by the Administrator.
7. Compensation of the Administrator. (a) The Fund agrees to pay to the
Administrator and the Administrator agrees to accept as full compensation for
all services rendered by the Administrator as such, a monthly fee (the
"Administration Fee") in arrears at an annual rate equal to the amount set forth
in Schedule A hereto of the average daily value of the Fund's Net Assets. "Net
Assets" means the total assets of the Fund minus the sum of the accrued
liabilities. For any period less than a month during which this Agreement is in
effect, the fee shall be prorated according to the proportion which such period
bears to a full month of 28, 29, 30 or 31 days, as the case may be.
(b) For purposes of this Agreement, the net assets of the Fund shall
be calculated pursuant to the procedures adopted by resolutions of the Trustees
of the Fund for calculating the value of the Fund's assets or delegating such
calculations to third parties.
8. Indemnity. (a) The Fund may, in the discretion of the Board of Trustees
of the Fund, indemnify the Administrator, and each of the Administrator's
directors, officers, employees, agents, associates and controlling persons and
the directors, partners, members, officers, employees and agents thereof
(including any individual who serves at the Administrator's request as director,
officer, partner, member, trustee or the like of another entity) (each such
person being an "Indemnitee") against any liabilities and expenses, including
amounts paid in satisfaction of judgments, in compromise or as fines and
penalties, and counsel fees (all as provided in accordance with applicable state
law) reasonably incurred by such Indemnitee in connection with the defense or
disposition of any action, suit or other proceeding, whether civil or criminal,
before any court or administrative or investigative body in which such
Indemnitee may be or may have been involved as a party or otherwise or with
which such Indemnitee may be or may have been threatened, while acting in any
capacity set forth herein or thereafter by reason of such Indemnitee having
acted in any such capacity, except with respect to
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any matter as to which such Indemnitee shall have been adjudicated not to have
acted in good faith in the reasonable belief that such Indemnitee's action was
in the best interest of the Fund and furthermore, in the case of any criminal
proceeding, so long as such Indemnitee had no reasonable cause to believe that
the conduct was unlawful; provided, however, that (1) no Indemnitee shall be
indemnified hereunder against any liability to the Fund or its shareholders or
any expense of such Indemnitee arising by reason of (i) willful misfeasance,
(ii) bad faith, (iii) gross negligence or (iv) reckless disregard of the duties
involved in the conduct of such Indemnitee's position (the conduct referred to
in such clauses (i) through (iv) being sometimes referred to herein as
"disabling conduct"), (2) as to any matter disposed of by settlement or a
compromise payment by such Indemnitee, pursuant to a consent decree or
otherwise, no indemnification either for said payment or for any other expenses
shall be provided unless there has been a determination that such settlement or
compromise is in the best interests of the Fund and that such Indemnitee appears
to have acted in good faith in the reasonable belief that such Indemnitee's
action was in the best interest of the Fund and did not involve disabling
conduct by such Indemnitee and (3) with respect to any action, suit or other
proceeding voluntarily prosecuted by any Indemnitee as plaintiff,
indemnification shall be mandatory only if the prosecution of such action, suit
or other proceeding by such Indemnitee was authorized by a majority of the full
Board of Trustees of the Fund.
(b) The Fund may make advance payments in connection with the
expenses of defending any action with respect to which indemnification might be
sought thereunder if the Fund receives a written affirmation of the Indemnitee's
good faith belief that the standard of conduct necessary for indemnification has
been met and a written undertaking to reimburse the Fund unless it is
subsequently determined that such Indemnitee is entitled to such indemnification
and if the Trustees of the Fund determine that the facts then known to them
would not preclude indemnification. In addition, at least one of the following
conditions must be met: (A) the Indemnitee shall provide security for such
Indemnitee undertaking, (B) the Fund shall be insured against losses arising by
reason of any unlawful advance, or (C) a majority of a quorum consisting of
Trustees of the Fund who are neither "interested persons" of the Fund (as
defined in Section 2(a)(19) of the 0000 Xxx) nor parties to the proceeding
("Disinterested Non Party Trustees") or an independent legal counsel in a
written opinion, shall determine, based on a review of readily available facts
(as opposed to a full trial type inquiry), that there is reason to believe that
the Indemnitee ultimately will be found entitled to indemnification.
(c) All determinations with respect to the standards for
indemnification hereunder shall be made (1) by a final decision on the merits by
a court or other body before whom the proceeding was brought that such
Indemnitee is not liable or is not liable by reason of disabling conduct, or (2)
in the absence of such a decision, by (i) a majority vote of a quorum of the
Disinterested Non Party Trustees of the Fund, or (ii) if such a quorum is not
obtainable or, even if obtainable, if a majority vote of such quorum so directs,
independent legal counsel in a written opinion. All determinations that advance
payments in connection with the expense of defending any proceeding shall be
authorized and shall be made in accordance with the immediately preceding clause
(2) above.
The rights accruing to any Indemnitee under these provisions shall not
exclude any other right to which such Indemnitee may be lawfully entitled.
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9. Limitation on Liability. (a) The Administrator will not be liable for
any error of judgment or mistake of law or for any loss suffered by
Administrator or by the Fund in connection with the performance of this
Agreement, except a loss resulting from willful misfeasance, bad faith or gross
negligence on its part in the performance of its duties or from reckless
disregard by it of its duties under this Agreement. As used in this Section
9(a), the term "Administrator" shall include any affiliates of the Administrator
performing services for the Fund contemplated hereby and partners, directors,
officers and employees of the Administrator and of such affiliates.
(b) Notwithstanding anything to the contrary contained in this
Agreement, the parties hereto acknowledge and agree that, as provided in Section
5.1 of the Declaration of Trust, this Agreement is executed by the Trustees
and/or officers of the Fund, not individually but as such Trustees and/or
officers of the Fund, and the obligations hereunder are not binding upon any of
the Trustees or Shareholders individually but bind only the estate of the Fund.
10. Duration and Termination. This Agreement shall become effective as of
the date hereof and, unless sooner terminated with respect to the Fund as
provided herein, shall continue in effect for a period of two years. Thereafter,
if not terminated, this Agreement shall continue in effect with respect to the
Fund for successive periods of 12 months, provided such continuance is
specifically approved at least annually by both (a) the vote of a majority of
the Fund's Board of Trustees or the vote of a majority of the outstanding voting
securities of the Fund at the time outstanding and entitled to vote, and (b) by
the vote of a majority of the Trustees who are not parties to this Agreement or
interested persons of any party to this Agreement, cast in person at a meeting
called for the purpose of voting on such approval. Notwithstanding the
foregoing, this Agreement may be terminated by the Fund at any time, without the
payment of any penalty, upon giving the Administrator 60 days' notice (which
notice may be waived by the Administrator), provided that such termination by
the Fund shall be directed or approved by the vote of a majority of the Trustees
of the Fund in office at the time or by the vote of the holders of a majority of
the outstanding voting securities of the Fund entitled to vote, or by the
Administrator on 60 days' written notice (which notice may be waived by the
Fund). This Agreement will also immediately terminate in the event of its
assignment. (As used in this Agreement, the terms "majority of the outstanding
voting securities," "interested person" and "assignment" shall have the same
meanings of such terms in the 1940 Act.)
11. Notices. Any notice under this Agreement shall be in writing to the
other party at such address as the other party may designate from time to time
for the receipt of such notice and shall be deemed to be received on the earlier
of the date actually received or on the fourth day after the postmark if such
notice is mailed first class postage prepaid.
12. Amendment of this Agreement. This Agreement may be amended by the
parties only if such amendment is specifically approved by the vote of the Board
of Trustees of the Fund, including a majority of those Trustees who are not
parties to this Agreement or interested persons of any such party cast in person
at a meeting called for the purpose of voting on such approval and, where
required by the 1940 Act, by a vote of a majority of the outstanding voting
securities of the Fund.
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13. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York for contracts to be performed
entirely therein without reference to choice of law principles thereof and in
accordance with the applicable provisions of the 1940 Act. To the extent that
the applicable laws of the State of New York, or any of the provisions, conflict
with the applicable provisions of the 1940 Act, the latter shall control.
14. Use of the Name BlackRock. The Administrator has consented to the use
by the Fund of the name or identifying word "BlackRock" in the name of the Fund.
Such consent is conditioned upon the employment of the Administrator as the
investment Administrator to the Fund. The name or identifying word "BlackRock"
may be used from time to time in other connections and for other purposes by the
Administrator and any of its affiliates. The Administrator may require the Fund
to cease using "BlackRock" in the name of the Fund if the Fund ceases to employ,
for any reason, the Administrator, any successor thereto or any affiliate
thereof as investment Administrator of the Fund.
15. Miscellaneous. 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. 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 on, and shall inure to the
benefit of the parties hereto and their respective successors.
16. Counterparts. This Agreement may be executed in counterparts by the
parties hereto, each of which shall constitute an original counterpart, and all
of which, together, shall constitute one Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused the foregoing
instrument to be executed by their duly authorized officers, all as of the day
and the year first above written.
CMA GOVERNMENT SECURITIES FUND
By:
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Name: Xxxxxx X. Xxxxx
Title: Vice President
BLACKROCK ADVISORS, LLC
By:
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Name: Xxxxxx X. Xxxxx
Title: Managing Director
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Schedule A
Administration Fee
0.25% of the average daily Net Assets of the Fund.
