COMMAND GOVERNMENT FUND
ADMINISTRATION AGREEMENT
ADMINISTRATION AGREEMENT, made as of this _______ day of _____, 1987
between COMMAND GOVERNMENT FUND, a Massachusetts business trust (the "Fund"),
and PRUDENTIAL MUTUAL FUND MANAGEMENT, INC., a Delaware corporation (the
"Administrator").
WITNESSETH:
WHEREAS, the Fund is an open-end management investment company
registered under the Investment Company Act of 1940, as amended (the "1940
Act"); and
WHEREAS, the Fund has been organized for the purpose of investing
its assets in securities and other investments and has retained an investment
adviser for this purpose and desires to avail itself of the facilities available
to the Administrator with respect to the administration of its day to day
business affairs, and the Administrator is willing to furnish such
administrative services on the terms and conditions hereinafter set forth:
NOW, THEREFORE, the parties agree as follows:
1. The Fund hereby appoints the Administrator to administer its
business affairs, subject to the overall supervision of the Trustees
of the Fund for the period and on the terms set forth in this
Agreement. The Administrator hereby accepts such appointment and
agrees during such period to render the services herein described
and to assume the obligations set forth herein, for the compensation
herein provided.
2. Subject to the supervision of the Trustees of the Fund, the
Administrator shall administer the Fund's business affairs and, in
connection therewith, shall furnish the Fund with office facilities
and with ordinary clerical, bookkeeping and recordkeeping services
at such facilities; shall be responsible for the financial and
accounting records required to be maintained by the Fund (including
those being maintained by the Fund's custodian) other than those
being maintained by the Fund's investment adviser; and shall
authorized and permit any of its directors, officers and employees
who may be elected as Trustees or officers of the Fund to serve in
the capacities in which they are elected. All services to be
furnished by the Administrator under this Agreement may be furnished
through the medium of any such directors, officers or employees of
the Administrator.
In connection with the services rendered by the Administrator under
this Agreement, the Administrator will bear all of the following expenses:
(a) the salaries and expenses of all personnel of the Fund and the
Administrator, except the fees and expenses of Trustees who are not affiliated
persons of the Administrator or the Fund's investment adviser, and
(b) all expenses incurred by the Administrator or by the Fund in
connection with administering the ordinary course of the Fund's business other
than those assumed by the Fund herein.
The Fund assumes and will pay the expenses described below:
(a) the fees and expenses of the investment adviser or expenses otherwise
incurred by the Fund in connection with the management of the investment and
reinvestment of the Fund's assets,
(b) the fees and expenses of Trustees who are not affiliated persons of
the Administrator or the Fund's investment adviser,
(c) the fees and expenses of the custodian which relate to (i) the
custodial function and the recordkeeping connected therewith, (ii) the
maintenance of the required accounting records of the Fund not being maintained
by the Administrator, (iii) the pricing of the shares of the Fund, including the
cost of any pricing service or services which may be retained pursuant to the
authorization of the Trustees of the Fund, and (iv) for both mail and wire
orders, the cashiering function in connection with the issuance and redemption
of the Fund's shares,
(d) the fees and expenses of the Fund's transfer and dividend disbursing
agent, which may be the custodian, which relate to the maintenance of each
shareholder account,
(e) the charges and expense of legal counsel and independent accountants
for the Fund,
(f) brokers' commissions and any issue or transfer taxes chargeable to the
Fund in connection with its securities transactions,
(g) all taxes and corporate fees payable by the Fund to federal, state or
other governmental agencies,
(h) the fees of any trade association of which the Fund may be a member,
(i) the cost of certificates, if any, representing, and non-negotiable
share deposit receipts evidencing, shares of the Fund,
(j) the cost of fidelity and errors and omissions insurance,
(k) the fees and expenses involved in registering and maintaining
registrations of the Fund and of its shares with the Securities and Exchange
Commission, registering the Fund as a broker or dealer and qualifying its shares
under state securities laws, including the preparation and printing of the
Fund's registration statements, prospectuses and statements of additional
information for filing under federal and state securities laws for such
purposes,
-2-
(l) allocable communications expenses with respect to investor services
and all expenses of shareholders' and Trustees' meetings and of preparing,
printing and mailing reports to shareholders in the amount necessary for
distribution to the shareholders,
(m) litigation and indemnification expenses and other extraordinary
expenses not incurred in the ordinary course of the Fund's business, and
(n) any expenses assumed by the Fund pursuant to a Plan of Distribution
adopted in conformity with Rule 12b-1 under the 1940 Act.
3. As full compensation for the services performed and the facilities
furnished by the Administrator, the Fund shall pay the Administrator a fee at
the annual rate of .3% of 1% of the first $1,000,000,000, and .275 of 1% of the
excess over $1,000,000,000 of the average daily net assets of the Fund. This fee
will be computed daily and paid monthly.
In the event the expenses of the Fund for any fiscal year (including
the fees payable to the Administrator and the Fund's investment adviser, if any,
but excluding interest, taxes, brokerage commissions, distribution fees and
litigation and indemnification expenses and other extraordinary expenses not
incurred in the ordinary course of the Fund's business) exceed the lowest
applicable annual expense limitation established pursuant to the statutes or
regulations of any jurisdictions in which shares of the Fund are then qualified
for offers and sales, the compensation payable to the Administrator will be
reduced by 75% of the amount of such excess. If such expenses exceed such
limitation after giving effect to the reduction of the fees payable to the
Administrator and the Fund's investment adviser to zero, the Administrator will
pay to the fund the amount of such expenses which exceed such limitation. Any
reduction in the fee payable or any payment by the Administrator to the Fund
shall be made monthly. Any such reductions or payments are subject to
readjustment during the Fund's fiscal year.
4. The Administrator assumes no responsibility under this Agreement other
than to render the services called for hereunder, and specifically assumes no
responsibilities for investment advice or the investment or reinvestment of the
Fund's assets.
5. The Administrator shall not be liable for any error of judgment or for
any loss suffered by the Fund in connection with the matters to which this
Agreement relates, 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 obligations and duties under this Agreement.
-3-
6. This Agreement shall continue in effect for a period of more than two
years from the date hereof only so long as such continuance is specifically
approved at least annually by the Trustees of the Fund; provided, however, that
this Agreement may be terminated by the Fund at any time, without the payment of
any penalty, by the Trustees of the Fund or by vote of a majority of the
outstanding voting securities (ad defined in the 0000 Xxx) of the Fund, or by
the Administrator at any time, without the payment of any penalty, on not more
than 60 days' nor less than 30 days' written notice to the other party. This
Agreement shall be automatically terminated in the event of its assignment (as
defined in the 1940 Act).
7. Nothing in this Agreement shall limit or restrict the right of any
director, officer or employee of the Administrator who may also be a Trustee,
officer or employee of the Fund to engage in any other business or to devote his
or her time and attention in part to the management or other aspects of any
business, whether of a similar or a dissimilar nature, nor limit or restrict the
right of the Administrator to engage in any other business or to render services
of any kind to any other corporation, firm, individual or association.
8. During the term of this Agreement, the Fund agrees to furnish the
Administrator at its principal office all prospectuses, statements of additional
information, proxy statements, reports to shareholders, sales literature, or
other material prepared for distribution to shareholders of the Fund or the
public, which refer in any way to the Administrator, prior to use thereof and
not to use such material if the Administrator reasonably objects in writing
within five business days (or such other time as may be mutually agreed) after
receipt thereof. In the event of termination of this Agreement, the Fund will
continue to furnish to the Administrator copies of any of the above-mentioned
materials which refer in any way to the Administrator. The Fund shall furnish or
otherwise make available to the Administrator such other information relating to
the business affairs of the Fund as the Administrator any time, or from time to
time, reasonably requests in order to discharge its obligations hereunder.
9. This agreement may be amended by mutual written consent.
10. Any notice or other communication required to be given pursuant to
this Agreement shall be deemed duly given if delivered or mailed by registered
mail, postage prepaid, (a) to the Administrator at Xxx Xxxxxxx Xxxxx, Xxx Xxxx,
Xxx Xxxx 00000, Attention: Secretary; or (b) to the Fund at Xxx Xxxxxxx Xxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Attention: President.
11. This Agreement contains the entire agreement between the parties
hereto and supersedes all prior agreements, understandings and arrangements with
respect to the subject matter hereof.
12. This Agreement shall be governed by and construed in accordance with
the laws of the State of New York.
-4-
13. The name "Command Government Fund" is the designation of the Trustees
under a Declaration of Trust dated _______, 1987, as amended from time to time,
and all persons dealing with the Fund must look solely to the property of the
Fund for the enforcement of any claims against the Fund as neither the Trustees,
officers, agents or shareholders assume any personal liability for obligations
entered into on behalf of the Fund.
14. All references to actions of or by Trustees herein shall require
action by the Trustees acting as a board or formally constituted group and not
individually.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed by their officers designated below as of the day and year first above
written.
COMMAND GOVERNMENT FUND
By: /s/ [ILLEGIBLE]
-------------------------
President
PRUDENTIAL MUTUAL FUND
MANAGEMENT, INC.
By: /s/ [ILLEGIBLE]
-------------------------
Exec. Vice President
-5-