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Exhibit 23(h)(2)
FUND ACCOUNTING SERVICE AGREEMENT
AGREEMENT made the 10th day of April, 1997, by and between The American Heritage
Fund, Inc., a New York Corporation, having its principal office and place of
business at 1370 Avenue of the Xxxxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000
(the "Fund"), and American Data Services, Inc., a New York corporation having
its principal office and place of business at the Hauppauge Corporate Center,
000 Xxxxx Xxxxxxx, Xxxxx 000, Xxxxxxxxx, Xxx Xxxx 00000 ("ADS")
BACKGROUND
WHEREAS, the Fund is a diversified, open-end management investment company
registered with the United States Securities and Exchange Commission under the
Investment Company Act of 1940, as amended (the "1940 Act"); and
WHEREAS, ADS is a corporation experienced in providing accounting services to
mutual funds and possesses facilities sufficient to provide such services; and
WHEREAS, the Fund desires to avail itself of the experience, assistance and
facilities of ADS and to have ADS perform for the Fund certain services
appropriate to the operations of the Fund, and ADS is willing to furnish such
services in accordance with the terms hereinafter set forth.
TERMS
NOW, THEREFORE, in consideration of the promises and mutual covenants
hereinafter contained, the Fund and ADS hereby agree as follows:
1. DUTIES OF ADS.
ADS will provide the Fund with the necessary office space, communication
facilities and personnel to perform the following services for the Fund:
(a) Timely calculate and transmit to NASDAQ the Fund's daily
net asset value and communicate such value to the Fund and its transfer agent;
Maintain and keep current all books and records of the Fund as required by Rule
31a-1 under the 1940 Act, as such rule or any successor rule may be amended from
time to time ("Rule 31a-1"), that are applicable to the fulfillment of ADS's
duties hereunder, as well as any other documents necessary or advisable for
compliance with applicable regulations as may be mutually agreed to between the
Fund and ADS. Without limiting the generality of the foregoing, ADS will prepare
and maintain the following records upon receipt of information in proper form
from the Fund or its authorized agents:
Cash receipts journal
Cash disbursements journal
Dividend record
Purchase and sales - portfolio securities journals
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Subscription and redemption journals
Security ledgers
Broker ledger
General ledger
Daily expense accruals
Daily income accruals
Securities and monies borrowed or loaned and collateral therefore
Foreign currency journals
Trial balances
(c) Provide the Fund and its investment adviser with daily
portfolio valuation, net asset value calculation and other standard operational
reports as requested from time to time.
(d) Provide all raw data available from our fund accounting
system (PAIRS) for management's or the administrators preparation of the
following:
1. Semi-annual financial statements;
2. Semi-annual form N-SAR;
3. Annual tax returns;
4. Financial data necessary to update form N-1a;
5. Annual proxy statement.
(e) Provide facilities to accommodate annual audit and any
audits or examinations conducted by the Securities and Exchange Commission or
any other governmental or quasi-governmental entities with jurisdiction.
ADS shall for all purposes herein be deemed to be an independent contractor and
shall, unless otherwise expressly provided or authorized, have no authority to
act for or represent the Fund in any way or otherwise be deemed an agent of the
Fund.
2. COMPENSATION OF ADS.
In consideration of the services to be performed by ADS as set forth
herein for each portfolio listed in Schedule B, ADS shall be entitled to receive
compensation and reimbursement for all reasonable out-of-pocket expenses. The
Fund agrees to pay ADS the fees and reimbursement of out-of-pocket expenses as
set forth in the fee schedule attached hereto as Schedule A.
3. LIMITATION OF LIABILITY OF ADS.
(a) ADS shall be held to the exercise of reasonable care in carrying out
the provisions of the Agreement, but shall be without liability to the Fund for
any action taken or omitted by it in good faith without gross negligence, bad
faith, willful misconduct or reckless disregard of its duties hereunder. It
shall be entitled to rely upon and may act upon the accounting records and
reports generated by the Fund, advice of the Fund, or of counsel for the Fund
and upon statements of the Fund's independent accountants, and shall be without
liability for any action reasonably taken or omitted pursuant to such records
and reports or advice, provided that such action is not, to the knowledge of
ADS, in violation of applicable federal or state laws or regulations, and
provided further that such action is taken without
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gross negligence, bad faith, willful misconduct or reckless disregard of its
duties.
(b) Nothing herein contained shall be construed to protect ADS against any
liability to the Fund or its security holders to which ADS shall otherwise be
subject by reason of willful misfeasance, bad faith, gross negligence in the
performance of its duties on behalf of the Fund, reckless disregard of ADS'
obligations and duties under this Agreement or the willful violation of any
applicable law.
(c) Except as may otherwise be provided by applicable law, neither ADS nor
its stockholders, officers, directors, employees or agents shall be subject to,
and the Fund shall indemnify and hold such persons harmless from and against,
any liability for and any damages, expenses or losses incurred by reason of the
inaccuracy of information furnished to ADS by the Fund or its authorized agents.
4. REPORTS.
(a) The Fund shall provide to ADS on a quarterly basis a report of a duly
authorized officer of the Fund representing that all information furnished to
ADS during the preceding quarter was true, complete and correct in all material
respects. ADS shall not be responsible for the accuracy of any information
furnished to it by the Fund or its authorized agents, and the Fund shall hold
ADS harmless in regard to any liability incurred by reason of the inaccuracy of
such information.
(b) Whenever, in the course of performing its duties under this Agreement,
ADS determines, on the basis of information supplied to ADS by the Fund or its
authorized agents, that a violation of applicable law has occurred or that, to
its knowledge, a possible violation of applicable law may have occurred or, with
the passage of time, would occur, ADS shall promptly notify the Fund and its
counsel of such violation.
5. ACTIVITIES OF ADS.
The services of ADS under this Agreement are not to be deemed exclusive,
and ADS shall be free to render similar services to others so long as its
services hereunder are not impaired thereby.
6. ACCOUNTS AND RECORDS.
The accounts and records maintained by ADS shall be the property of the
Fund, and shall be surrendered to the Fund, at the expense of the Fund, promptly
upon request by the Fund, provided that all service fees and expenses charged by
ADS in the performance of its duties hereunder have been fully paid to the
satisfaction of ADS, in the form in which such accounts and records have been
maintained or preserved. ADS agrees to maintain a back-up set of accounts and
records of the Fund (which back-up set shall be updated on at least a weekly
basis) at a location other than that where the original accounts and records are
stored. ADS shall assist the Fund's independent auditors, or, upon approval of
the Fund, any regulatory body, in any requested review of the Fund's accounts
and records. ADS shall preserve the accounts and records as they are required to
be maintained and preserved by Rule 31a-1.
7. CONFIDENTIALITY.
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ADS agrees that it will, on behalf of itself and its officers and
employees, treat all transactions contemplated by this Agreement, and all other
information germane thereto, as confidential and not to be disclosed to any
person except as may be authorized by the Fund.
8. DURATION AND TERMINATION OF THIS AGREEMENT.
This Agreement shall become effective on the date first above written.
This Agreement shall remain in effect for a period of three (3) years from the
date of its effectiveness (the "Initial Term") and shall continue in effect for
successive twelve-month periods; provided that such continuance is specifically
approved at least annually by the Board and by a majority of the Directors who
are not parties to this Agreement or interested persons of any such party.
After the Initial Term, this Agreement may be terminated at anytime (i) by the
Board on 90 days' written notice to ADS or (ii) by ADS on 90 days' written
notice to the Fund. The obligations of Sections 2 and 3 shall survive any
termination of this Agreement
Should the Fund exercise its right to terminate, all out-of-pocket expenses
associated with the movement of records and material will be borne by the Fund.
Additionally, ADS reserves the right to charge for any other reasonable costs
expenses associated with such termination.
9. ASSIGNMENT.
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 by the Fund without the prior written consent
of ADS, or by ADS without the prior written consent of the Fund.
10. NEW YORK LAWS TO APPLY
The provisions of this Agreement shall be construed and interpreted in
accordance with the laws of the State of New York as at the time in effect and
the applicable provisions of the 1940 Act. To the extent that the applicable law
of the State of New York, or any of the provisions herein, conflict with the
applicable provisions of the 1940 Act, the latter shall control.
11. AMENDMENTS TO THIS AGREEMENT.
This Agreement may be amended by the parties hereto only if such amendment
is in writing and signed by both parties.
12. MERGER OF AGREEMENT
This Agreement constitutes the entire agreement between the parties hereto
and supersedes any prior agreement with respect to the subject matter hereof
whether oral or written.
13. NOTICES.
All notices and other communications hereunder shall be in writing, shall
be deemed to have been given when received or when sent by telex or facsimile,
and shall be given to the following addresses (or such other addresses as to
which notice is given):
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To the Fund: To ADS:
Xxxxx X. Xxxxxx Xxxxxxx Xxxxx
President President
The American Heritage Fund, Inc. American Data Services, Inc.
0000 Xxxxxx xx xxx Xxxxxxxx, 00xx Xxxxx 000 Xxxxx Xxxxxxx, Xxxxx 000
Xxx Xxxx, XX 00000 Xxxxxxxxx, XX 00000
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year first above written.
THE AMERICAN HERITAGE FUND, INC. AMERICAN DATA SERVICES, INC.
By: /s/ Xxxxx X. Xxxxxx, President
By: /s/Xxxxxxx Xxxxx
SCHEDULE A
(a) FUND ACCOUNTING SERVICE FEE:
For the services rendered by ADS in its capacity as fund accounting agent,
as specified in Paragraph 1. DUTIES OF ADS, the Fund shall pay ADS, within ten
(10) days after receipt of an invoice from ADS at the beginning of each month, a
fee equal to:
Calculated Fee Will Be Based Upon Prior Month Average Net Assets:
(No prorating partial months)
MONTHLY FEE PER PORTFOLIO:
The greater of:
Minimum Monthly Fee - $3,025.94
OR,
Net Asset Charge of:
1/12th of 0.1153% of first $25 million of average monthly net assets, plus
1/12th of 0.0650% of next $25 million of average monthly net assets, plus 1/12th
of 0.025% on all average monthly net assets in excess of $50 million.
MULTI-CLASS PROCESSING CHARGE
$300 per month will be charged for each additional class of stock per
portfolio.
FEE INCREASES
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On each annual anniversary date of this Agreement, the fees enumerated
above will be increased by the change in the Consumer Price Index for the
Northeast region (CPI) for the twelve month period ending with the month
preceding such annual anniversary date.
(b) EXPENSES.
The Fund shall reimburse ADS for any out-of-pocket expenses , exclusive of
salaries, advanced by ADS in connection with but not limited to the printing or
filing of documents for the Fund, travel, telephone, quotation services
(currently (1) $0.12 per equity valuation, $0.60 per bond valuation, and 1.50
for each foreign quotation or manual quote insertion), facsimile transmissions,
stationery and supplies, record storage, NASDAQ insertion fee ($22 (1) per
month), prorata portion of annual SAS 70 review, postage, telex, and courier
charges, incurred in connection with the performance of its duties hereunder.
ADS shall provide the Fund with a monthly invoice of such expenses and the Fund
shall reimburse ADS within fifteen (15) days after receipt thereof.
(1) Rate subject to change on 30 days notice.
(c) SPECIAL REPORTS.
All reports and /or analyses requested by the Fund, its auditors, legal
counsel, portfolio manager, or any regulatory agency having jurisdiction over
the Fund, that are not in the normal course of fund accounting activities as
specified in Section 1 of this Agreement shall be subject to an additional
charge, agreed upon in advance, based upon the following rates:
Labor:
Senior staff - $150.00/hr.
Junior staff - $ 75.00/hr.
Computer time - $45.00/hr.
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SCHEDULE B:
PORTFOLIOS TO BE SERVICED UNDER THIS AGREEMENT:
THE AMERICAN HERITAGE FUND, INC.
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ADDENDUM TO
SCHEDULE A
Of the
Fund Accounting Service Agreement
Between The American Heritage Fund, Inc. and American Data Services, Inc.
Effective date: March 1, 1999
Effective as of the date first written above through February 29, 2000, the fund
accounting service fees enumerated in Schedule A of the Fund Accounting Service
Agreement dated April 10, 1997 between The American Heritage Fund, Inc. and
American Data Services, Inc. shall be subject to a discount of 20%. This
discount may be discontinued at any time by American Data Services.
Agreed and accepted by:
THE AMERICAN HERITAGE FUND, INC. AMERICAN DATA SERVICES, INC.
By: /s/ Xxxxx X. Xxxxxx, President
By: /s/Xxxxxxx Xxxxx
