ADMINISTRATION AGREEMENT
MPAM FUNDS TRUST
200 Park Avenue
New York, New York 10166
June 14, 2000
Mellon Bank, N.A.
One Mellon Bank Center
Pittsburgh, PA 15258
Dear Sirs:
The above-named investment company (the "Fund") herewith
confirms its agreement with you as follows:
The Fund desires to employ its capital by investing and
reinvesting the same in investments of the type and in accordance with the
limitations specified in its charter documents and in its Prospectus and
Statement of Additional Information as from time to time in effect, copies of
which have been or will be submitted to you, and in such manner and to such
extent as from time to time may be approved by the Fund's Board. The Fund
intends to employ MPAM Advisers, a division of The Dreyfus Corporation, (the
"Adviser") to act as its investment adviser and desires to employ you to act as
its administrator.
In this connection it is understood that from time to time
you will employ or associate with yourself such person or persons as you may
believe to be particularly fitted to assist it in the performance of this
Agreement. Such person or persons may be officers or employees who are employed
by both you and the Fund. The compensation of such person or persons shall be
paid by you and no obligation may be incurred on the Fund's behalf in any such
respect. We have discussed and concur in your employing on this basis The
Dreyfus Corporation to act as the Fund's sub-administrator (the
"Sub-Administrator") to provide sub-administrative services to the Fund.
Subject to the supervision and control of the Fund's Board,
you will assist in supervising all aspects of the Fund's operations except
investment management of the Fund's portfolio, which shall be performed by the
Adviser under its Investment Advisory Agreement with the Fund. It is understood
that you shall not act and shall not be required to act as an investment adviser
or have any authority to supervise the investment or reinvestment of the cash,
securities or other property comprising the Fund's assets or to determine what
securities or other property may be purchased or sold by the Fund. You shall be
<PAGE>
responsible for maintaining records relating to the individual "MPAM Accounts"
and for maintaining relations with the "MPAM Clients" as these terms are defined
in the Fund's prospectus. These services shall include aggregation of the
purchase and redemption orders for the MPAM Accounts and transmission to the
Fund's transfer agent, providing information to the MPAM Clients concerning
their investments in the Fund, and responding to inquiries regarding the Funds
from the MPAM Clients.
You will supply office facilities (which may be in your own
offices), data processing services, clerical, accounting and bookkeeping
services, internal auditing and legal services, internal executive and
administrative services, and stationery and office supplies; and prepare reports
to the Fund's stockholders, tax returns, reports to and filings with the
Securities and Exchange Commission and state Blue Sky authorities; and calculate
the daily net asset value of the Fund's shares in accordance with the Fund's
Declaration of Trust and then-current registration statement. In addition, you
will pay the fees and expenses of the Fund's transfer agent.
You shall exercise your best judgment in rendering the
services to be provided hereunder and the Fund agrees as an inducement to your
undertaking the same that you shall not be liable hereunder for any error of
judgment or mistake of law or for any loss suffered by the Fund, provided that
nothing herein shall be deemed to protect or purport to protect you against any
liability to the Fund or to its security holders to which you would otherwise be
subject by reason of willful misfeasance, bad faith or gross negligence in the
performance of your duties hereunder, or by reason of your reckless disregard of
your obligations and duties hereunder.
In consideration of the services rendered pursuant to this
Agreement, the Fund will pay you a fee calculated daily and paid monthly at the
annual rate of the following percentages of the Fund's aggregate average daily
net assets: 0.15% of such assets through $6 billion; 0.12% of such assets
greater than $6 billion through $12 billion; and 0.10% of such assets greater
than $12 billion. No fee shall be applied to assets held by the MPAM Balanced
Fund which are invested in (i) cash or money market instruments or (ii) shares
of the other series of the Fund.
Net asset value shall be computed on such days and at such
time or times as described in the Fund's then-current Prospectus and Statement
of Additional Information. The fee for the period from the date of the
commencement of the public sale of the Fund's shares to the end of the month
-2-
<PAGE>
during which such sale shall have been commenced shall be pro-rated according to
the proportion which such period bears to the full monthly period, and upon any
termination of this Agreement before the end of any month, the fee for such part
of a month shall be pro-rated according to the proportion which such period
bears to the full monthly period and shall be payable upon the date of
termination of this Agreement.
For the purpose of determining fees payable to you, the
value of the Fund's net assets shall be computed in the manner specified in the
Fund's charter documents for the computation of the value of the Fund's net
assets.
You will bear all expenses in connection with the
performance of its services under this Agreement. All other expenses to be
incurred in the operation of the Fund will be borne by the Fund, except to the
extent specifically assumed by you or the Adviser. The expenses to be borne by
the Fund include, without limitation, the following: organizational costs,
taxes, interest, loan commitment fees, interest and distributions paid on
securities sold short, brokerage fees and commissions, if any, fees of Board
members who are not officers, directors, employees or holders of 5% or more of
the outstanding voting securities of the Adviser or you or any of the Adviser's
or your affiliates, Securities and Exchange Commission fees, except those share
registration fees paid during the Fund's first year of operation, which shall be
paid by you, and state Blue Sky qualification fees, advisory and administration
fees, charges of custodians, insurance premiums, industry association fees,
outside auditing and legal expenses, costs of maintaining the Fund's existence,
costs of independent pricing services, costs of shareholders' reports and
corporate meetings, costs of preparing and printing certain prospectuses and
statements of additional information for regulatory purposes and for
distribution to existing shareholders, and any extraordinary expenses.
The Fund understands that you may act as administrator of
various investment companies and fiduciary or other managed accounts, and the
Fund has no objection to your so acting. In addition, it is understood that the
persons employed by you to assist in the performance of duties hereunder will
not devote their full time to such service and nothing contained herein shall be
deemed to limit or restrict the right of you or the right of any of your
affiliates to engage in and devote time and attention to other businesses or to
render services of whatever kind or nature.
Any person, even though also your officer, director,
partner, employee or agent, who may be or become an officer, Board member, or
-3-
<PAGE>
employee of the Fund, shall be deemed, when acting in the capacity of officer,
Board member or employee of the Fund, to be rendering such services to or acting
solely for the Fund and not as your officer, director, partner, employee, or
agent or one under your control or direction even though paid by you.
This Agreement shall continue until June 1, 2002 and
thereafter shall continue automatically for successive annual periods ending on
June 1 of each year, provided such continuance is specifically approved at least
annually by (i) the Fund's Board or (ii) vote of a majority (as defined in the
Investment Company Act of 1940) of the Fund's outstanding voting securities,
provided that in either event its continuance also is approved by a majority of
the Fund's Board members who are not "interested persons" (as defined in said
Act) of any party to this Agreement, by vote cast in person at a meeting called
for the purpose of voting on such approval. This Agreement is terminable without
penalty, on 60 days' notice, by the Fund's Board or by vote of holders of a
majority of the Fund's shares or, upon not less than 90 days' notice, by you.
This Agreement also will terminate automatically in the event of its assignment
(as defined in said Act).
The Fund recognizes that from time to time your directors,
officers and employees may serve as directors, trustees, partners, officers and
employees of other corporations, business trusts, partnerships and other
entities (including other investment companies) and that your corporation or its
affiliates may enter into administration or other agreements with such other
entities. If you cease to act as the Fund's administrator, the Fund agrees that,
at your request, the Fund will take all necessary action to change the name of
the Fund to a name not including "MPAM" or "Mellon Private Asset Management" in
any form or combination of words.
This Agreement has been executed on behalf of the Fund by
the undersigned officer of the Fund in his capacity as an officer of the Fund.
The obligations of this Agreement shall only be binding upon the assets and
property of the Fund and shall not be binding upon any Board member, officer or
shareholder of the Fund individually.
If the foregoing is in accordance with your understanding,
will you kindly so indicate by signing and returning to us the enclosed copy
hereof.
-4-
<PAGE>
Very truly yours,
MPAM FUNDS TRUST
By:
----------------------
Accepted:
MELLON BANK, N.A.
By:
----------------------
