Exhibit h(2)
ADMINISTRATION AGREEMENT
AGREEMENT made as of October 2, 2000 by and between TT International
U.S.A. FEEDER Trust, a business trust organized under the laws of the
Commonwealth of Massachusetts (the "Fund"), and INVESTORS BANK & TRUST COMPANY,
a Massachusetts trust company (the "Bank").
WHEREAS, the Fund, a registered investment company under the Investment
Company Act of 1940, as amended (the "1940 Act"), consisting of the separate
portfolios listed on Appendix A hereto; and
WHEREAS, the Fund desires to retain the Bank to render certain
administrative services to the Fund and the Bank is willing to render such
services.
NOW, THEREFORE, in consideration of the mutual covenants herein set forth,
it is agreed between the parties hereto as follows:
1. Appointment. The Fund hereby appoints the Bank to act as Administrator
of the Fund on the terms set forth in this Agreement. The Bank accepts such
appointment and agrees to render the services herein set forth for the
compensation herein provided.
2. Delivery of Documents. The Fund has furnished the Bank with copies
properly certified or authenticated of each of the following:
(a) Resolutions of the Fund's Board of Directors authorizing the
appointment of the Bank to provide certain administrative services to the Fund
and approving this Agreement;
(b) The Fund's declaration of trust filed with the Commonwealth of
Massachusetts on [date] and all amendments thereto (the "Articles");
(c) The Fund's by-laws and all amendments thereto (the "By-Laws");
(d) The Fund's agreements with all other service providers which
include any investment advisory agreements, sub-investment advisory agreements,
custody agreements, distribution agreements and transfer agency agreements
(collectively, the "Agreements");
(e) The Fund's most recent Registration Statement on Form N-1A (the
"Registration Statement") under the Securities Act of 1933 and under the 1940
Act, as applicable, and all amendments thereto; and
(f) The Fund's most recent prospectus and statement of additional
information, if any (the "Prospectus"); and
(g) Such other certificates, documents or opinions as may mutually be
deemed necessary or appropriate for the Bank in the proper performance of its
duties hereunder.
The Fund will immediately furnish the Bank with copies of all
amendments of or supplements to the foregoing. Furthermore, the Fund will
notify the Bank as soon as possible of any matter which may materially affect
the performance by the Bank of its services under this Agreement.
3. Duties of Administrator. Subject to the supervision and direction of
the Board of Directors of the Fund, the Bank, as Administrator, will assist in
conducting various aspects of the Fund's administrative operations and
undertakes to perform the services described in Appendix B hereto. The Bank
may, from time to time, perform additional duties and functions which shall be
set forth in an amendment to such Appendix B executed by both parties. At such
time, the fee schedule included in Appendix C hereto shall be appropriately
amended.
In performing all services under this Agreement, the Bank shall act in
conformity with the Fund's Articles and By-Laws and the 1940 Act, as the same
may be amended from time to time, and the investment objectives, investment
policies and other practices and policies set forth in the Fund's Registration
Statement, as the same may be amended from time to time. Notwithstanding any
item discussed herein, the Bank has no discretion over the Fund's assets or
choice of investments and cannot be held liable for any problem relating to
such investments.
4. Duties of the Fund.
(a) The Fund is solely responsible (through its transfer agent or
otherwise) for (i) providing timely and accurate reports ("Daily Sales
Reports") which will enable the Bank as Administrator to monitor the total
number of shares sold in each state on a daily basis and (ii) identifying any
exempt transactions ("Exempt Transactions") which are to be excluded from the
Daily Sales Reports.
(b) The Fund agrees to make its legal counsel available to the Bank for
instruction with respect to any matter of law arising in connection with the
Bank's duties hereunder, and the Fund further agrees that the Bank shall be
entitled to rely on such instruction without further investigation on the part
of the Bank.
5. Fees and Expenses.
(a) For the services to be rendered and the facilities to be furnished
by the Bank, as provided for in this Agreement, the Fund will compensate the
Bank in accordance with the fee schedule attached as Appendix C hereto. Such
fees do not include out-of-pocket disbursements (as delineated on the fee
schedule or other expenses with the prior approval of the Fund's management) of
the Bank for which the Bank shall be entitled to xxxx the Fund separately and
for which the Fund shall reimburse the Bank.
(b) The Bank shall not be required to pay any expenses incurred by the
Fund.
6. Limitation of Liability.
(a) The Bank, its directors, officers, employees and agents shall not
be liable for any error of judgment or mistake of law or for any loss suffered
by the Fund in connection with the performance of its obligations and duties
under this Agreement, except a loss resulting from willful misfeasance, bad
faith or gross negligence in the performance of such obligations and duties, or
by reason of its reckless disregard thereof. The Fund will indemnify the Bank,
its directors, officers, employees and agents against and hold it and them
harmless from any and all losses, claims, damages, liabilities or expenses
(including legal fees and expenses) resulting from any claim, demand, action or
suit (i) arising out of the actions or omissions of the Fund, including, but
not limited to, inaccurate Daily Sales Reports (unless such inaccurate Daily
Sales Report was prepared in a grossly negligent manner by the Bank in its role
as Transfer Agent) and misidentification of Exempt Transactions; (ii) arising
out of the offer or sale of any securities of the Fund in violation of (x) any
requirement under the federal securities laws or regulations, (y) any
requirement under the securities laws or regulations of any state (except as a
result of any grossly negligent failure by the Bank to perform its duties in
relation to compliance with any state securities laws or regulations), or (z)
any stop order or other determination or ruling by any federal or state agency
with respect to the offer or sale of such securities; or (iii) resulting from
the performance of the Bank under this Agreement and not resulting from the
willful misfeasance, bad faith or gross negligence of the Bank in the
performance of such obligations and duties or by reason of its reckless
disregard thereof.
(b) The Bank may apply to the Fund at any time for instructions and may
consult counsel for the Fund, or its own counsel, and with accountants and
other experts with respect to any matter arising in connection with its duties
hereunder, and the Bank shall not be liable or accountable for any action taken
or omitted by it in good faith in accordance with such instruction, or with the
opinion of such counsel, accountants, or other experts. The Bank shall not be
liable for any act or omission taken or not taken in reliance upon any
document, certificate or instrument which it reasonably believes to be genuine
and to be signed or presented by the proper person or persons. The Bank shall
not be held to have notice of any change of authority of any officers,
employees, or agents of the Fund until receipt of written notice thereof has
been received by the Bank from the Fund.
(c) Neither party shall be liable to the other for any loss, damage,
liability, action, suit, claim, cost or expense arising from any acts of God,
earthquakes, fires, floods, storms or other disturbances of nature, epidemics,
strikes, riots, nationalization, expropriation, currency restrictions, acts of
war, civil war or terrorism, insurrection, nuclear fusion, fission or
radiation, the interruption, loss or malfunction of utilities or transportation
or the unavailability of energy sources or other similar happenings or events
that can not be controlled or contained by such party.
(d) Notwithstanding anything to the contrary in this Agreement, in no
event shall either party be liable to the other or to any third party for lost
profits or lost revenues or any special, consequential, punitive or incidental
damages of any kind whatsoever in connection with this Agreement or any
activities hereunder.
(e) In order that the indemnification provisions contained in this
Article 6 shall apply, upon the assertion of a claim for which a party may be
required to indemnify the other, the party seeking the indemnification shall
promptly notify the other party of such assertion, and shall keep the other
party advised with respect to all developments concerning such claim. The party
seeking indemnification shall give the indemnifying party full and complete
authority, information and assistance to defend such claim or proceeding, and
the indemnifying party shall have, at its option, sole control of the defense
of such claim or proceeding and all negotiations for its compromise or
settlement. The party seeking indemnification shall in no case confess any
claim or make any compromise in any case in which the other party may be
required to indemnify it except with the other party's prior written consent,
which consent shall not be unreasonably withheld.
7. Termination of Agreement.
(a) The term of this Agreement shall be three years commencing upon the
date hereof (the "Initial Term"), unless earlier terminated as provided herein.
After the expiration of the Initial Term, the term of this Agreement shall
automatically renew for successive three-year terms (each a "Renewal Term")
unless notice of non-renewal is delivered by the non-renewing party to the
other party no later than ninety days prior to the expiration of the Initial
Term or any Renewal Term, as the case may be.
Either party hereto may terminate this Agreement prior to the
expiration of the Initial Term or any Renewal Term in the event the other party
violates any material provision of this Agreement, provided that the violating
party does not cure such violation within ninety days of receipt of written
notice from the non-violating party of such violation.
If a majority of the Board of the Fund reasonably determines that the
performance of the Bank under this Agreement has been unsatisfactory, written
notice (the "Notice") of such determination setting forth the reasons for such
determination shall be provided to the Bank. In the event the Bank shall not,
within thirty (30) days thereafter, cure identified deficiencies to the
reasonable satisfaction of the Board, the Fund, with the authorization of the
Board, may terminate this Agreement upon an additional 30 days' notice.
(b) At any time after the termination of this Agreement, the Fund may,
upon written request, have reasonable access to the records of the Bank
relating to its performance of its duties as Administrator.
8. Miscellaneous.
(a) Any notice or other instrument authorized or required by this
Agreement to be given in writing to the Fund or the Bank shall be sufficiently
given if addressed to that party and received by it at its office set forth
below or at such other place as it may from time to time designate in writing.
To the Fund:
TT International Investment Management
Xxxxxx Xxxxx, Xxxxxx Xxxx
Xxxxxx, Xxxxxxx XX0X 0XX
Attention: Head of Compliance and Legal
With a copy to:
Xxxxxxx Xxxx LLP
000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Xxxx Xxxxxx
To the Bank:
Investors Bank & Trust Company
000 Xxxxxxxxx Xxxxxx, X.X. Xxx 0000
Xxxxxx, XX 00000-0000
Attention: Xxxxxxxxxxx Xxxxx, Director, Client Management
With a copy to: Xxxx X. Xxxxx, General Counsel
(b) This Agreement shall extend to and shall be binding upon the
parties hereto and their respective successors and assigns; provided, however,
that this Agreement shall not be assignable without the written consent of the
other party.
(c) This Agreement shall be construed in accordance with the laws of
the Commonwealth of Massachusetts, without regard to its conflict of laws
provisions.
(d) This Agreement may be executed in any number of counterparts each
of which shall be deemed to be an original and which collectively shall be
deemed to constitute only one instrument.
(e) The captions of 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.
9. Confidentiality. All books, records, information and data pertaining to
the business of the other party which are exchanged or received pursuant to the
negotiation or the carrying out of this Agreement shall remain confidential,
and shall not be voluntarily disclosed to any other person, except as may be
required in the performance of duties hereunder or as otherwise required by
law. Nothing herein shall prevent the Fund from disclosing any information
contained in the Fund's records as provided by the Bank hereunder.
10. Use of Name. Neither party hereto shall use the name of the other
party or any of its affiliates in any prospectus, sales literature or other
material relating to such party in a manner not approved by the other party
prior thereto in writing; provided however, that approval shall not be required
for any use of a party's name which merely refers in accurate and factual terms
to the appointment of the Bank hereunder or which is required by the Securities
and Exchange Commission or any state securities authority or any other
appropriate regulatory, governmental or judicial authority; provided further,
that in no event shall such approval be unreasonably withheld or delayed.
11. Limitation of Liability. This Agreement is executed and made by the
Trustees of the Fund not individually but as Trustees under the Fund's
Declaration of Trust and the obligations of this Agreement are not binding upon
any of the Trustees or shareholders of the Fund individually but bind only the
trust estate of the Fund. The Bank agrees that the obligations assumed by the
Fund hereunder shall be limited in all cases to the assets of the Fund and that
the Bank shall not seek satisfaction of any such obligation from the officers,
agents, employees, trustees, or shareholders of the Fund.
12. Several Obligations of the Portfolios. This Agreement is an agreement
entered into between the Bank and the Fund with respect to each Portfolio. With
respect to any obligation of the Fund on behalf of any Portfolio arising out of
this Agreement, the Bank shall look for payment or satisfaction of such
obligation solely to the assets of the Portfolio to which such obligation
relates as though the Bank had separately contracted with the Fund by separate
written instrument with respect to each Portfolio.
13. Existence and Authority Representation. Each party represents and
warrants as follows: (i) such party was duly organized, and legally exists,
under the laws of the jurisdiction in which it was formed; (ii) such party has
full power and authority to enter into, and to perform and observe the terms
and conditions of, this Agreement; (iii) such party has duly executed and
delivered this Agreement; (iv) this Agreement is the valid and binding
obligation of such party enforceable according to its terms, subject to
standard exceptions relating to equitable remedies and laws of bankruptcy and
insolvency; (v) the execution, delivery, and performance of this Agreement by
such party will not violate or conflict with, or result in a default under, any
other agreement or contract to which such party is a party or to which its
assets are subject; and (vi) such party is not required to make any
governmental filings, or to obtain any governmental or other third party
consents or approvals, as a condition to entering into, or performing and
observing the terms of, this Agreement.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
duly executed and delivered by their duly authorized officers as of the date
first written above.
TT INTERNATIONAL U.S.A. FEEDER TRUST
By: /s/ Xxxxx Xxxxxxx
Name: Xxxxx Xxxxxxx
Title: Trustee, President
Investors Bank & Trust Company
By: /s/ Xxxxxx X. Xxxxxx
Name: Xxxxxx X. Xxxxxx
Title: Senior Director
Appendices
Appendix A..................................... Portfolios
Appendix B..................................... Services
Appendix C..................................... Fee Schedule
Appendix A
PORTFOLIOS
TT EAFE Mutual Fund
TT Europe Mutual Fund
INVESTORS BANK & TRUST
SUMMARY OF ADMINISTRATION FUNCTIONS
TT INTERNATIONAL MASTER AND FEEDER
SUGGESTED FUND
INVESTORS BANK & TRUST TT INTERNATIONAL AUDITOR OR COUNSEL
-------------------------------------- --------------------------------- -------------------------------- ------------------------
Management Reporting
& Treasury Administration
--------------------------------------
Monitor portfolio compliance in Perform tests of certain specific Continuously monitor portfolio A/C - Provide
accordance with the current Prospectus portfolio activity designed from and Fund operations in consultation as needed
and SAI. provisions of the Fund's conjunction with 1940 Act, on compliance issues.
Prospectus and SAI in Prospectus, SAI and any other
accordance with the compliance applicable laws and regulations.
schedule for the Fund. Monitor testing results and
Follow-up on potential approve resolution of
FREQUENCY: DAILY violations. [M/F: Applied at compliance issues.
Master level for purposes of
ease of calculation.]
Provide compliance summary package. Provide a daily report of Review report. A/C - Provide
compliance testing results to consultation as needed.
FREQUENCY: MONTHLY TT International (including
information on diversification
testing for SEC purposes.)
[M/F: Applied at same levels as
testing is performed.]
Perform asset diversification testing Perform asset diversification Continuously monitor portfolio A - Provide consultation
to establish qualification as a RIC. tests at each tax quarter end. activity in conjunction with as needed in
Follow-up on issues. IBT will IRS requirements. Review test establishing positions
forward to TT International and results and take any necessary to be taken in tax
PWC the quarterly calculation action. Approve tax positions treatment of particular
FREQUENCY: QUARTERLY by 8th business day following taken. issues. Reviewquarter
each quarter end. [M/F: end tests on a current
Applied at Master level for basis.
purposes of ease of
calculation.]
SUGGESTED FUND
INVESTORS BANK & TRUST TT INTERNATIONAL AUDITOR OR COUNSEL
-------------------------------------- --------------------------------- -------------------------------- ------------------------
Management Reporting
& Treasury Administration
(CONT.)
--------------------------------------
Perform qualifying income testing to Perform qualifying income Continuously monitor portfolio A- Consult as needed on
establish qualification as a RIC. testing (on book basis income, activity in conjunction with tax accounting positions
unless material differences are IRS requirements. Review test to be taken. Review in
anticipated) on quarterly basis results and take any necessary conjunction with year-
and as may otherwise be action. Approve tax positions end audit.
FREQUENCY: QUARTERLY necessary. IBT will forward taken.
the quarterly calculation to TT
International and PWC by 8th
business day. Follow-up on
issues. [M/F: Applied at
Feeder level.]
Prepare the Fund's annual expense Prepare preliminary expense Provide asset level projections.
budget. Establish daily accruals. budget. Notify fund accounting Approve expense budget,
of new accrual rates. [M/F: subject to Trustee approval.
FREQUENCY: ANNUALLY Applied at all levels.]
Monitor the Fund's expense budget. Monitor actual expenses Provide asset level projections C/A - Provide
updating budgets/ expense quarterly. Provide vendor consultation as
accruals. IBT in consultation information as necessary. requested.
with TT will adjust more often Review expense analysis and
if necessary. [M/F: Applied at approve budget revisions.
FREQUENCY: QUARTERLY & MONTHLY AS all levels]
NECESSARY
Receive and coordinate payment of Propose allocations of invoice Approve invoices and
fund expenses. among Funds and obtain allocations of payments. TT
authorized approval to process will instruct Vendors to send
FREQUENCY: AS OFTEN AS NECESSARY payment. [M/F: Applied at all invoices to both TT and IBT.
levels.]
SUGGESTED FUND
INVESTORS BANK & TRUST TT INTERNATIONAL AUDITOR OR COUNSEL
-------------------------------------- --------------------------------- -------------------------------- ------------------------
Management Reporting
& Treasury Administration
(CONT.)
--------------------------------------
Calculate periodic dividend rates to Calculate amounts available for TT will review and concur with C - Review dividend
be declared in accordance with distribution in accordance with proposed calculations in resolutions in
management guidelines. the dividend policy established accordance with the dividend conjunction with Board
by the Trustees. Coordinate policy established by the approval.
review by management and/or Trustees.
auditors. Notify custodian and A - Review and concur
transfer agent of authorized with proposed
FREQUENCY: ACCORDING TO DIVIDEND dividend rates in accordance distributions in
POLICY with Board approved policy. accordance with the
Report dividends to Board as dividend policy
required. [M/F: Applied at established by the
Feeder level.] Trustees.
Calculate total return information on Provide total return Review total return information. A - To test annual
Funds as defined in the current calculations. [M/F: Applied at total return
Prospectus and SAI. Feeder level.] information in
financial highlights
as part of year-end
audit.
FREQUENCY: MONTHLY
Prepare responses to major industry Prepare, coordinate as Identify the services to which
questionnaires. necessary, and submit responses the Funds report. Provide
to the appropriate agency. information as requested.
FREQUENCY: AS OFTEN AS NECESSARY [M/F: Applied at Feeder level.]
Prepare disinterested director/trustee Summarize amounts paid to Provide social security numbers
Form 1099-Misc. directors/trustees during the and current mailing address for
calendar year. Prepare and trustees. Review and approve
mail Form 1099-Misc. [M/F: information provided for Form
FREQUENCY: ANNUALLY Applied at Master and Feeder 1099-Misc.
levels.]
--------------------------------------
FINANCIAL REPORTING
--------------------------------------
Prepare financial information for Prepare selected portfolio and Review financial information.
presentation to Fund Management and financial information for
Board of Directors. inclusion in board material.
[M/F: Applied at Master and
FREQUENCY: QUARTERLY Feeder levels.]
SUGGESTED FUND
INVESTORS BANK & TRUST TT INTERNATIONAL AUDITOR OR COUNSEL
-------------------------------------- --------------------------------- -------------------------------- ------------------------
Coordinate the annual audit and semi- Coordinate the creation of Provide past financial A - Perform audit and
annual preparation and printing of templates reflecting client- statements and other issue opinion on
financial statements and notes with selected standardized information required to create annual financial
management, fund accounting and the appearance and text of templates, including report statements.
fund auditors. financial statements and style and graphics. Approve
footnotes. Draft and manage format and text as standard. A/C - Review reports.
production cycle. Coordinate Approve production cycle and
with IBT fund accounting the assist in managing to the
electronic receipt of portfolio cycle. Coordinate review and
and general ledger approval by portfolio managers
information. Assist in of portfolio listings to be
resolution of accounting included in financial
issues. Using templates, draft statements. Prepare
financial statements, appropriate management letter
coordinate auditor and and coordinate production of
management review, and clear Management Discussion and
comments. Coordinate printing Analysis. Review and approve
of reports and XXXXX conversion entire report. Make
FREQUENCY: ANNUALLY/SEMI-ANNUALLY with outside printer and filing appropriate representations in
with the SEC via XXXXX. [M/F: conjunction with audit.
Applied at Master and Feeder
levels.]
SUGGESTED FUND
INVESTORS BANK & TRUST TT INTERNATIONAL AUDITOR OR COUNSEL
-------------------------------------- --------------------------------- -------------------------------- ------------------------
LEGAL
--------------------------------------
Prepare agenda and board materials for Maintain annual calendar of Review and approve board C - Review agenda,
quarterly board meetings. required quarterly and annual materials and board and resolutions, board
approvals. Prepare agenda, committee meeting minutes. material and board and
resolutions and other board committee meeting
materials for quarterly board minutes. Ensure BOD
meetings and any Trustee material contains all
Committee meetings. Prepare required information
supporting information and that the BOD must
materials when necessary. review and/or approve
Assemble, check and distribute to perform their
books in advance of meeting. duties as directors.
FREQUENCY: QUARTERLY Attend board and committee A - Provide reports to
meetings and prepare minutes. the Trustees Committee
[M/F: Applied at Master and regarding audits.
Feeder levels.]
Prepare and file Form N-SAR. Prepare form for filing. Obtain Provide appropriate responses. C - Review initial
any necessary supporting Review and authorize filing. filing. A - Provide
documents. File with SEC via annual audit internal
XXXXX. [M/F: Applied at Master control letter to
and Feeder levels.] accompany the annual
filing.
FREQUENCY: SEMI-ANNUALLY
Prepare amendments to Registration Prepare and coordinate the Review and approve. C - Review and approve
Statement. filing of post-effective filings.
amendments. Coordinate with A/C - Provide consents
FREQUENCY: ANNUAL UPDATE (INCLUDES outside printers the Xxxxx as appropriate.
UPDATING FINANCIAL HIGHLIGHTS, conversion, filing with the SEC A - Review and
EXPENSE TABLES, RATIOS) PLUS ONE and printing of prospectus. comment as needed.
ADDITIONAL FILING PER FISCAL YEAR [M/F: Applied at Master and
Feeder levels.]
Prepare Prospectus/SAI supplements. Prepare Prospectus and SAI Review and approve. C - Review and approve
supplements. File with the SEC filings.
via Xxxxx. Coordinate printing A/C - Provide consents
of supplements. as appropriate.
[M/F: Applied at Master and A - Review and comment
FREQUENCY: AS OFTEN AS REQUIRED Feeder levels.] as needed.
SUGGESTED FUND
INVESTORS BANK & TRUST TT INTERNATIONAL AUDITOR OR COUNSEL
-------------------------------------- --------------------------------- -------------------------------- ------------------------
LEGAL (CONT.)
--------------------------------------
Preparation and filing of 24f-2 Accumulate capital stock Review and approve filing. C - Review initial
Notice. information and draft Form (Based on information to be form of 24f-2 Notice.
24f-2. Notice. File approved provided by transfer agent.)
Form with SEC via Xxxxx. A - Review informally
[M/F: Applied at Feeder level.] when requested
FREQUENCY: ANNUALLY
Proxy Material/Shareholder Meetings Prepare drafts of proxy Review and approve proxy. C - Review and approve
material for review, file proxy.
materials or coordinate filing
with SEC and coordinate A - Review and approve
printing. Provide names of proxy as needed.
recommended proxy solicitation
firms. Assist proxy
FREQUENCY: AS NEEDED solicitation firm with any
legal related issues and
prepare scripts. Attend
meeting and prepare minutes.
[M/F: Applied at Master and
Feeder levels.]
Assist in updating of fidelity bond Make annual filing of fidelity Obtain required fidelity bond
insurance coverage. bond insurance material with insurance coverage. Monitor
the SEC. [M/F: Applied at level of fidelity bond
Master and Feeder levels.] insurance maintained in
FREQUENCY: ANNUALLY accordance with required
coverage.
Respond to regulatory audits. Compile and provide Coordinate with regulatory C - Provide
documentation pursuant to audit auditors to provide requested consultation as
requests. Assist client in documentation and resolutions needed.
resolution of audit inquiries. to inquiries.
FREQUENCY: AS NEEDED (AT LEAST [M/F: Applied at Master and
ANNUALLY) Feeder levels.]
SUGGESTED FUND
INVESTORS BANK & TRUST TT INTERNATIONAL AUDITOR OR COUNSEL
-------------------------------------- --------------------------------- -------------------------------- ------------------------
LEGAL (CONT.)
--------------------------------------
Maintain principal office and provide Maintain principal office of the
officers. Master and Feeder and keep
documents prepared by the IBT
mfa - legal dep't. in
connection with its duties
FREQUENCY: AS NEEDED herein on behalf of the Master
and Feeder and other legal
records prepared by persons
(other than at IBT) and
forwarded to Xx. Xxxxxxxxx or
Xxxxx Xxxxxxx or a person
designated by IBT to receive
such records (except records
prepared or maintained by TT
International in its capacity
as investment manager of the
Funds) address correspondence
for the Funds delivered to
their principal office, forward
forthwith to TT and Counsel any
legal process or regulatory
communications delivered to the
Funds at their principal
office, and provide assistant
secretaries and assistant
treasurers upon request.
[M/F: Applied at Master and
Feeder levels.]
SUGGESTED FUND
INVESTORS BANK & TRUST TT INTERNATIONAL AUDITOR OR COUNSEL
-------------------------------------- --------------------------------- -------------------------------- ------------------------
BLUE SKY
--------------------------------------
Maintain effective Blue Sky Maintain records of fund sales Identify states in which C - Provide
notification filings for states in for client designated states filings are to be made. consultation as needed
which Fund Management intends to via Blue2 compliance system. on Blue Sky issues.
solicit sales of fund shares. File annual notification Upon notice from IBT that sales
renewal documents and annual in a particular state exceed C - Provide
sales reports. the dollar amount registered in consultation on
Notify TT International if the state, identify exempt product and
sales are at 80% or more of the transactions to transfer agent institutional
dollar amount registered in a for appropriate exclusion from exemptions.
particular state. blue sky reporting.
File amendments to increase
dollar amounts authorized for
sales by funds, based upon
client instruction.
File notifications to states
for new funds and/or classes,
mergers and liquidations.
Provide periodic reports on
FREQUENCY: ON-GOING state authorization amounts and
sales amounts. Determine state
filing requirements by using
CCH Blue Sky Law Reporter, ICI
memoranda and state securities
commission directives (both
written and oral). [M/F:
Applied at Feeder level.]
File amendments to registration File updated registration Inform IBT of filings prior to C - Provide
statement with the applicable state statements, prospectuses, SAIs, SEC filing if such filing is consultation as needed
securities commissions in coordination supplements thereto, and annual not made by IBT. on Blue Sky filing
with SEC filing. reports to shareholders upon issues.
approval/authorization by
FREQUENCY: ANNUAL UPDATES client. [M/F: Applied at Feeder
(INCLUDES REGISTRATION STATEMENT, level.]
PROSPECTUS, SAI) PLUS ONE ADDITIONAL
FILING PER FISCAL YEAR
SUGGESTED FUND
INVESTORS BANK & TRUST TT INTERNATIONAL AUDITOR OR COUNSEL
-------------------------------------- --------------------------------- -------------------------------- ------------------------
TAX
--------------------------------------
Calculate excise tax distributions Calculate required Provide transaction information A - Provide
distributions to avoid as requested. Identify Passive consultation as needed
imposition of excise tax. Foreign Investment Companies in establishing
- Calculate capital gain (PFICs). Approve tax positions to be taken
net income and foreign accounting positions to be in tax treatment of
currency gain/loss through taken. Review and approve all particular issues.
October 31. income and distribution Review and concur with
- Calculate ordinary income calculations, including proposed distributions
and distributions through projected income and dividend per share.
a specified cut off date . shares. Approve distribution
- Project ordinary income rates per share and aggregate
from cut off date to amounts in accordance with the
December 31. distribution policies
- Ascertain dividend shares. established by the
Identify book-tax accounting Trustees.
differences. Track required
information relating to
accounting differences. [M/F:
Book-tax accounting
differences applied at both
Master and Feeder levels.
Distribution calculations
applied at Feeder level.]
FREQUENCY: ANNUALLY Coordinate review by management
and fund auditors. Notify
custody and transfer agent of
authorized dividend rates in
accordance with Board approved
policy. Report dividends to
Board as required.
Prepare tax returns Prepare excise and RIC tax Review and sign tax return. A - Review and sign
returns. tax return as
Prepare partnership return for preparer.
Master. Prepare excise and RIC
returns for Feeder. Prepare
partners' Schedules K-1.
FREQUENCY: ANNUALLY
SUGGESTED FUND
INVESTORS BANK & TRUST TT INTERNATIONAL AUDITOR OR COUNSEL
-------------------------------------- --------------------------------- -------------------------------- ------------------------
TAX (CONT.)
--------------------------------------
Prepare Form 1099 Obtain yearly distribution Review and approve information
information. Calculate 1099 provided for Form 1099.
reclasses and coordinate with
transfer agent. [M/F: Applied
FREQUENCY: ANNUALLY at Feeder level.]
Prepare other year-end tax-related Obtain yearly income Review and approve information
disclosures distribution provided.
information. Calculate
disclosures
(i.e., dividend received
deductions,
foreign tax credits,
FREQUENCY: ANNUALLY tax-exempt
income, income by
jurisdiction) and
coordinate with transfer
agent. [M/F: Applied at Feeder
level.]
Prepare income tax provisions. Calculate investment company Provide transaction information A - Provide
taxable income, net tax exempt as requested. Identify Passive consultation as needed
interest, net capital gain and Foreign Investment Companies in establishing
spillback dividend (PFICs). Approve tax positions to be taken
requirements. Identify book-tax accounting positions to be in tax treatment of
accounting differences. Track taken. Approve provisions. particular issues.
required information relating Perform review in
to accounting differences. conjunction with the
[M/F: Book-tax accounting year-end audit.
differences applied at both
Master and Feeder levels.
FREQUENCY: ANNUALLY Distribution calculations
applied at Feeder level.]
REVIEW AND APPROVAL
The attached Summary of Administration Functions has been reviewed and represents the services currently being provided.
/s/ Xxxxxx X. Xxxxxx
----------------------------------------------------------
Signature of Account Manager/ Date
/s/ Xxxxx Xxxxxxx 2/10/00
----------------------------------------------------------
Signature of Authorized Client Representative/ Date
Appendix C
FEE SCHEDULE
TT INTERNATIONAL
MASTER-FEEDER STRUCTURE
FEE SCHEDULE
================================================================================
CUSTODY, FUND ACCOUNTING, DAILY CALCULATION OF N.A.V., ADMINISTRATION,
& INSTITUTIONAL TRANSFER AGENCY
================================================================================
FEES AT THE MASTER LEVEL
A. CUSTODY & FUND ACCOUNTING
o The following basis point fee is based on Net Assets:
First $250 Million in Assets 4 BASIS POINTS
Next $250 Million in Assets 3 BASIS POINTS
Above $500 Million in Assets 2 BASIS POINTS
There will be an annual minimum of $50,000.
B. DOMESTIC CUSTODY TRANSACTIONS
o Transaction Fees:
DTC/Fed Book Entry $10.00
Physical Securities $35.00
Options and Futures $18.00
GNMA Securities $40.00
Principal Paydown $ 5.00
Third Party Foreign Exchange $18.00**
Outgoing Wires $ 7.00
Incoming Wires $ 5.00
**Investors Bank does not charge transaction charges for Foreign Exchanges
executed with Investors Bank's Treasury Department.
C. FOREIGN SUBCUSTODIAN FEES
o Incremental basis point and transaction fees will be charged for
all foreign assets for which we are custodian. The asset based fees
and transaction fees vary by country, based upon the attached
global custody fee schedule. Local duties, scrip fees, handling of
proxies, postage, delivery and legal fees and other market charges
are out-of-pocket.
o Investors Bank will require the portfolios to hold all assets at
the subcustodian of our choice.
o Fees for additional markets to be discussed with your client
manager.
D. MUTUAL FUND ADMINISTRATION
o The following basis point fee is based on the average daily net
assets of each portfolio.
First $250 Million in Assets 6 BASIS POINTS
Next $250 Million in Assets 4 BASIS POINTS
Above $500 Million in Assets 3 BASIS POINTS
There will be an annual minimum of $60,000.
o There will be a one-time fee of $3,750 for start-up legal services
relating to the Organizational Board Meeting of the master.
FEES AT THE FEEDER LEVEL
A FUND ACCOUNTING & CALCULATION OF N.A.V.
There will be a $16,000 charge per feeder.
B. MUTUAL FUND ADMINISTRATION
The following annual fees will apply per feeder:
Tax, Compliance & Financial Reporting $30,000*
LEGAL SERVICES (BOARD SUPPORT, REGISTRATIONS, $35,000**
24f-2, Annual Report Review, Fidelity Bond Filing)
There will be a one-time fee of $3,750 for start-up legal
services relating to the Organizational Board Meeting for a
feeder.
Blue Sky $100 PER PERMIT
*Due to the limited nature of the Tax, Compliance and Financial
Reporting services that will be provided to the LKCM International
Fund, the annual fee will be $5,000 for that feeder.
**It is assumed that Investors Bank will not provide Legal
Services to the LKCM International Fund.
C. INSTITUTIONAL TRANSFER AGENCY
There will be an annual fee of $25,000 for Transfer Agency Services for
each feeder.
It is assumed Investors Bank will not provide Transfer Agency services
for the LKCM International Fund.
================================================================================
OUT-OF-POCKET & BALANCE CREDITS
================================================================================
A. OUT-OF-POCKET
o These charges consist of:
-Third Party Review -Pricing & Verification Services
-Legal Expenses -Customized Reporting
-Printing, Delivery, Postage, Fax -Data Transmissions
-Forms and Supplies -Performance Measurement
-Telecommunication -Printing of Annual Reports
-Financial statement report modification as to style, layout
or format (after initially agreed upon parameters).
-Microfiche
-Ad Hoc Reporting -Additional Mailings or Inserts
-Returned Checks -Tax Preparation (TA)
-Solicitation & Proxy Tabulation -Certificates and Rights Offerings
-Storage Charge -Copy fitting
-Extraordinary Travel Expenses -InvestView
-Customized Statements, Transmissions/Extracts
-Systems Development Costs
B. DOMESTIC BALANCE CREDIT
o We allow use of balance credit against fees (excluding out-of-pocket
charges) for balances arising out of the custody relationship. The
credit is based on collected balances reduced by balances required to
support the activity charges of the accounts. The monthly earnings
allowance is equal to 75% of the 90-day T-xxxx rate.
C. SYSTEMS
o The details of any systems work will be determined after a thorough
business analysis. Systems work will be billed on a time and material
basis. Investors Bank provides an allowance of 10 systems hours for
data extract set up and reporting extract set up. Additional systems
hours will be billed on a time and material basis.
================================================================================
MISCELLANEOUS
================================================================================
A. CASH MANAGEMENT
o The assumption was made that Investors Bank would perform cash
management for the portfolio. Investors Bank does not charge fees for
transactions relating to this service.
** The above fees will be charged against the funds' checking account on the
last day of each month. All fees are to be billed monthly.
** This fee schedule is confidential information of the parties and shall not
be disclosed to any third party without prior written consent of both
parties.
** A letter of intent accompanied by a $10,000 deposit to be credited against
future fees is required to begin this implementation. This fee schedule is
valid for 60 days from date of issue and assumes the execution of our
standard contractual agreements for a minimum of three years. This fee
estimate may change as further information becomes available.
Accepted and Approved By: /s/ Xxxxx Xxxxxxx
Name: Xxxxx Xxxxxxx
Title: Trustee, President
Date: October 2, 2000
