AMENDMENT TO ACCOUNTING SERVICES AGREEMENT
This AGREEMENT, dated as of the ------- day of -------------- , 1997,
made by and between Winthrop Opportunity Funds, a business trust (the
"Trust") operating as an open-end management investment company registered
under the Investment Company Act of 1940, as amended, duly organized and
existing under the laws of the State of Delaware and FPS Services, Inc.
("FPS") (formerly known as Fund/Plan Services, Inc.), a corporation duly
organized and existing under the laws of the State of Delaware
(collectively, the "Parties").
WITNESSETH THAT:
WHEREAS, the Trust and FPS entered into an Accounting Services
Agreement dated April 1, 1995, wherein FPS agreed to provide certain
portfolio accounting and pricing services to the Trust (the "Agreement");
and
WHEREAS, the Parties wish to amend the Agreement to: (i) reflect the
change in the name of FPS; (ii) amend Schedule "C" of the Agreement and to
include under the Agreement's terms two separate series of shares to be
known as "Winthrop U.S. Government Money Fund" and "Winthrop Municipal
Money Fund" (the "Money Funds"); and (iii) the inclusion under the
Agreement of Schedules "D" and "E" which set forth, respectively, the
services to be provided to the Money Funds and the fees to be charged there
against.
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein, the Parties hereto, intending to be legally bound, do
hereby agree:
1. That Schedule "C," of the Agreement be replaced in its entirety
with Schedule "C" attached hereto;
2. That Schedule "D" in the form attached hereto become part of the
Agreement setting forth the services to be performed by FPS on behalf
of the Money Funds; and
3. That Schedule "E" in the form attached hereto become part of the
Agreement setting forth the fees to be charged by FPS for the
services performed by it on behalf of the Money Funds.
IN WITNESS WHEREOF, the Parties hereto have caused this Agreement,
consisting of one type-written page, together with Schedules "C" "D" and
"E," to be signed by their duly authorized officers as of the day and year
first above written.
Winthrop Opportunity Fund FPS Services, Inc.
--------------------------------- ---------------------------------
Xxxxxx Xxxxx, Treasurer Xxxxxxx X. Xxxxx, President
SCHEDULE "C"
Effective April 1, 1995
Amended --------------, 1997
Identification of Series
Below are listed the Series and Classes of Shares to which services under
this Agreement are to be performed as of the Effective Date of this
Agreement:
"WINTHROP OPPORTUNITY FUNDS"
1. Winthrop Developing Markets Fund - Class A Shares
2. Winthrop Developing Markets Fund - Class B Shares
3. Winthrop International Equity Fund - Class A Shares
4. Winthrop International Equity Fund - Class B Shares
5. Winthrop U.S. Government Money Fund
6. Winthrop Municipal Money Fund
This Schedule "C" may be amended from time to time by agreement of the
Parties.
SCHEDULE "D"
SCHEDULE OF FUND ACCOUNTING AND PORTFOLIO VALUATION SERVICES
TO BE PERFORMED ON BEHALF OF
WINTHROP U.S. GOVERNMENT MONEY FUND AND
WINTHROP MUNICIPAL MONEY FUND
(A FUND OR COLLECTIVELY, THE FUNDS)
I. Daily Accounting Services
1) Calculate Net Asset Value ("NAV") and Daily Dividend Rate:
o Provide money market original and amortized cost schedules in
accordance with valuing the Fund based on amortized cost, inclusive
of all debt issues income accruals.
o Prepare Net Asset Value (NAV) proof sheets. Review components of
change in NAV and distribution rate for reasonableness.
o Calculate net investment income available for distribution daily.
o Verify system calculated dollar average weighted maturity.
o Calculate daily rate, and 1, 7, 30-day yields.
o Supply Trust's transfer agent (the "Transfer Agent"), and Wood,
Xxxxxxxxx & Winthrop with distribution rates, average weighted
maturity and 1, 7, 30-day yields.
o If applicable, communicate required information electronically to
NASDAQ.
2) Determine and Report Cash Availability by approximately 9:00 AM
Eastern Time and 1:00 PM Eastern Time, as provided by the Funds'
Transfer Agent :
o Receive daily cash and transaction statements from the Trust's
custodian (the "Custodian") by 8:30 AM Eastern time.
o Receive previous day shareholder activity reports from the Transfer
Agent by 8:30 AM Eastern time and 12:30 PM Eastern time.
o Hard copy Cash Availability calculations with all details to Wood,
Xxxxxxxxx & Winthrop will be supplied by the Transfer Agent.
o Prepare and complete daily bank cash reconciliations including
documentation of any reconciling items and notify the Custodian
and Wood, Xxxxxxxxx & Winthrop.
3) Reconcile and Record All Daily Expense Accruals:
o Accrue expenses based on budget supplied by Wood, Xxxxxxxxx &
Winthrop either as percentage of net assets or specific dollar
amounts.
o If applicable, monitor expense limitations established by Wood,
Xxxxxxxxx & Winthrop.
o If applicable, accrue daily amortization of Organizational Expense.
o Complete daily accrual of 12b-1 expenses.
4) Verify and Record All Daily Income Accruals for Debt and Money Market
Issues:
o Review and verify all system generated Interest and Amortization
reports.
o Establish unique security codes for fixed income and money market
issues to permit segregated Trial Balance income reporting.
o Review and verify all Variable Rate Demand Notes, daily, weekly,
quarterly, semi-annual and annual rate resets, supplied by the
Funds' Investment Advisor or vendor, such as Municipal Market
Data.
5) Enter All Security Trades on Investment Accounting System (IAS) based
on written instructions from the Funds' advisor (the "Advisor").
o Review system verification of trade and interest calculations.
o Verify settlement through statements supplied by the Custodian.
o Maintain security ledger transaction reporting.
o Maintain tax lot holdings.
o Determine realized gains or losses on security trades.
o Provide complete broker commission reporting.
6) Enter All Fund Share Transactions on IAS:
o Process activity identified on reports supplied by the Transfer
Agent.
o Verify settlement through each Fund's statements supplied by the
Custodian.
o Reconcile to the Transfer Agent's report balances.
7) Prepare and Reconcile/Prove Accuracy of the Daily Trial Balance
(listing all asset, liability, equity, income and expense accounts)
o Post manual entries to the general ledger.
o Post Custodian bank activity.
o Post security transactions.
o Post and verify system generated activity, i.e. income and expense
accruals.
o Prepare Fund's general ledger net cash proof used in NAV and daily
distribution calculations.
8) Review and Reconcile with the Custodian's Statements:
o Verify all posted interest, expenses, and shareholder and security
payments/receipts, etc. (Discrepancies will be reported to the
Custodian.)
o Post all cash settlement activity to the Trial Balance.
o Reconcile to ending cash balance accounts.
o Clear IAS subsidiary reports with settled amounts.
o Track status of past due items and failed trades handled by the
Custodian.
9) Submission of Daily Accounting Reports to Wood, Xxxxxxxxx & Winthrop:
(Additional reports readily available.)
o Trial Balance
o Daily, 7-day and 30-day yield calculations o NAV Calculation
Report with daily distribution rate o Cash availability o Dollar
weighted average maturity o Interest and Amortization Report o
Portfolio Valuation using Amortized Cost
II. Weekly Accounting Services
If applicable, submit Money Market Fund Xxxx-to-Market Report and Interest
and Amortization schedule to Wood, Xxxxxxxxx & Winthrop (based on Wood,
Xxxxxxxxx & Winthrop or vendor supplied money market yields or prices).
III. Monthly Accounting Services
1) For each Series, full Financial Statement Preparation (automated
Statements of Assets and Liabilities, of Operations and of Changes in
Net Assets) and submission to Wood, Xxxxxxxxx & Winthrop by 10th
business day.
2) Submission of Monthly Automated IAS Reports to Wood, Xxxxxxxxx &
Winthrop:
o Security Purchase/Sales Journal
o Interest and Maturity Report
o Brokers Ledger (Commission Report)
o Security Ledger Transaction Report with Realized Gains/Losses
o Security Ledger Tax Lot Holdings Report
o Additional reports available upon request
3) Reconcile Accounting Asset Listing to the Custodian's Asset Listing:
o Report any security balance discrepancies to the Custodian and
Wood, Xxxxxxxxx & Winthrop.
4) Provide Monthly Analysis and Reconciliation of Additional Trial
Balance Accounts, such as:
o Security cost and realized gains/losses o Interest/dividend
receivable and income o Payable/receivable for securities
purchased and sold
o Payable/receivable for Fund's shares; issued and redeemed o
Expense payments and accruals analysis o Distribution
Payable/Dividend Paid
5) If Appropriate, Prepare and Submit to Wood, Xxxxxxxxx & Winthrop:
o Income by state reporting
o Standard Industry Code Valuation Report
o Alternative Minimum Tax Income segregation schedule
IV. Annual (and Semi-Annual) Accounting Services
1) Assist and supply auditors with schedules supporting securities and
shareholder transactions, income and expense accruals, etc. for each
Fund during the year in accordance with standard audit assistance
requirements.
2) Provide NSAR Reporting (Accounting Questions):
If applicable for each Fund, answer the following items: 2, 12B, 20,
21, 22, 23, 28, 30A, 31, 32, 35, 36, 37, 43, 53, 55, 62, 63, 00X,
00, 00, 00, 00, 00, 00.
V. Basic Assumptions:
The Accounting Fees as stated in Schedule "E," attached hereto, are
based on the following assumptions. These assumptions are based upon
discussions with and information received from Xxxxx Xxxxxxxx. To the
extent these assumptions do not reflect the ongoing operation of the
Trust during the term of this Agreement, fee revisions may be
necessary.
1) Compliance reporting (Sub-Chapter "M") shall be maintained by Wood,
Xxxxxxxxx & Winthrop as Fund administrator.
2) The Funds' security trading activity is assumed to be approximately
65 trades per month in the Municipal Money Fund and 80 trades per
month in the U.S. Government Money Fund (inclusive of domestic and
money market transactions).
3) The Funds will invest in money market instruments, such as:
Tax Exempt Government
---------- ----------
Repo's Repo's
Variable Rate Demand Notes Variable Rate Demand Notes
Treasury Securities Treasury Securities
Agencies Agencies
Revenue Bond FHLMC's
Tax-free Commercial Paper
Tax Anticipation Notes
Revenue Anticipation Notes
4) The Funds have a tax year-end which coincides with its fiscal
year-end. No additional accounting requirements are necessary to
identify or maintain book-tax differences. FPS does not provide
security tax accounting which differs from its book accounting.
5) The Funds agree to utilize FPS's standard current pricing services
for domestic bond securities. Xxxxxx Data Corporation, Telerate
Systems or Interactive Data Corporation (IDC) are used for bonds and
money market issues. Bloomberg is also available for price research
and backup. Municipal Market Data (MMD) would be recommended to
supply daily rate changes on Variable Rate Demand Notes (VRDN).
It is assumed that FPS will work closely with the Wood, Xxxxxxxxx &
Winthrop to ensure the accuracy of the Funds' NAV and daily
distribution rates and to obtain the most satisfactory pricing
sources and specific methodologies prior to the actual start- up
date.
6) FPS will supply daily Portfolio Valuation and Interest and
Amortization Reports to the Advisor or manager identifying current
security positions and original/amortized cost.
FPS will submit weekly xxxx-to-market reports and Interest and
Amortization Reports to the client (based on client or vendor
supplied money market yields or prices) for the Funds. It is assumed
that the stability of the Funds' $1.00 NAV will be reviewed by the
Advisor.
It is the responsibility of the Advisor to review these reports and
to promptly notify FPS of any possible problems, trade discrepancies,
incorrect security prices or corporate action/capital change
information that could result in a misstated Fund NAV and
distribution rate.
7) The Funds do not expect to invest in Options, Futures, Swaps, Xxxxxx,
Derivatives or Foreign (non-US dollar denominated) Securities and
Currency. To the extent these investment strategies should change,
additional fees will apply after the appropriate procedural
discussions have taken place between FPS and the Funds' management.
(Two weeks advance notice is required should the Funds commence
trading in these investments.)
To the extent the Fund will purchase/hold open-end registered
investment companies (RIC's), it will require procedural discussions
between FPS and Fund management clarifying the appropriate pricing
and dividend rate sources. Depending on the methodologies selected by
the Fund, additional fees may apply.
8) It is assumed for all debt and money market issues that the Advisor
will supply FPS with critical income information such as accrual
methods, interest payment frequency details, coupon payment dates,
variable rate demand note resets, floating rate reset dates, and
complete security descriptions with issue types and CUSIP numbers. If
applicable, for proper income accrual accounting, FPS will look to
the Advisor to supply the yield to maturity and related cash flow
schedules for any mortgage/asset- backed securities held in the
Funds. Also, FPS would need updated rate changes on variable rate
demand notes from the Advisor or third party provider.
9) With respect to Mortgage/Asset-Backed securities including GNMA's,
FHLMC's, FNMA's, CMO's, ARM's, the Funds shall direct the Custodian,
or a Wood, Xxxxxxxxx & Winthrop supplied source, to provide FPS with
current principal repayment factors on a timely basis in accordance
with the appropriate securities' schedule. Income accrual adjustments
(to the extent necessary) based upon initial estimates will be
completed by FPS when actual principal/income payments are collected
by the Custodian and reported to FPS.
10) To the extent that the Funds should establish a Line of Credit in
segregated accounts with the Custodian for temporary administrative
purposes, and/or leveraging/hedging the portfolio, it is not the
responsibility under this proposal for FPS to complete the
appropriate paperwork/monitoring for segregation of assets and
adequacy of collateral. The Funds shall direct the Advisor to execute
such responsibilities. FPS will, however, reflect appropriate Trial
Balance account entries and interest expense accrual charges on the
daily Trial Balance adjusting as necessary at month-end.
11) If the Funds commence participation in Security Lending, Leveraging,
or Short Sales within their portfolio securities, additional fees
will apply. (Two weeks advance notice to FPS is required should the
Funds desire to participate in the above.)
12) The Funds shall direct the Advisor to supply FPS with portfolio
specific expense accrual procedures and monitor the expense accrual
balances for adequacy based on outstanding liabilities monthly. The
Advisor will promptly communicate to FPS any adjustments needed.
13) Specific deadlines shall be met and complete information shall be
supplied by the Funds in order to minimize any settlement problems,
NAV miscalculations or income accrual adjustments.
The Funds shall direct the Advisor to provide to FPS Trade
authorization Forms with the appropriate Funds' officer's signature
on all security trades placed by the Fund no later than 1:30 PM
Eastern time on settlement/value date for short term money market
securities issues (assuming that trade date equals settlement date);
and by 11:00 AM Eastern time on trade date plus one for next days
settlement and non- money market securities. The Advisor will supply
FPS with the trade details in accordance with the above stated
deadlines.
The Funds shall direct the Advisor to include all information
required by FPS; including CUSIP numbers for all U.S. dollar
denominated trades on the Trade Authorization Form. FPS will supply
the Advisor with recommended trade ticket documents to minimize
receipt of incomplete information. FPS will not be responsible for
NAV changes or distribution rate adjustments that result from
incomplete trade information.
14) To the extent the funds utilize Purchases In-Kind (U.S. dollar
denominated securities only) as a method for shareholder
subscriptions, FPS will provide the Funds with procedures to properly
handle and process Securities In-Kind. Should the Funds prefer
procedures other than those provided by FPS, additional fees may
apply. Discussions shall take place at least two weeks in advance
between FPS and the Funds to clarify the appropriate In-Kind
operational procedures to be followed.
15) It is assumed that the Funds' Advisor will complete the applicable
performance and rate of return calculations as required by the SEC
for the Funds.
16) Adjustments for financial statements regarding any issues with
Original Issue Discount (OID) are not included under this agreement.
The Fund shall direct its independent auditors to complete the
necessary OID adjustments for financial statements and/or tax
reporting.
17) It is assumed that FPS will provide Transfer Agency and Custody
Administration services.
SCHEDULE "E"
SCHEDULE OF FEES FOR FUND ACCOUNTING AND PORTFOLIO VALUATION SERVICES
FOR
WINTHROP U.S. GOVERNMENT MONEY FUND AND
WINTHROP MUNICIPAL MONEY FUND
This Fee Schedule is fixed for a period of two years from commencement
of operations and shall not increase greater than 10% during the
one year period beginning January 1, 1999.
The Accounting Fees as set forth below are based on the "Basic Assumptions"
as set forth in Schedule "D." To the extent that those assumptions are
inaccurate or requirements change, fee revisions may be necessary.
I. Annual Fee Schedule Per Domestic Portfolio: Investments in U.S. Dollar
denominated securities only. (1/12th payable monthly)
.00054 On the First $ 75 Million of Average Net Assets*
.00038 On the Next $ 75 Million of Average Net Assets*
.0002 On the Next $600 Million of Average Net Assets*
.0001 Over $750 Million of Average Net Assets*
Minimum of $24,000 per portfolio per year with Single Class. Each
additional Class is $7,500 per year per Class.
*For Multiple Class portfolios, fees are based on Combined Classes'
Average Net Assets.
II. Pricing Services Quotation Fee: Specific costs will be identified
based upon options selected by Wood, Xxxxxxxxx & Winthrop and will be
billed monthly.
-----------------------------------------------------------------------------------
Xxxxxx Data Interactive X.X. Xxxxx
Security Types Corp.* Data Corp.* Co., Inc.*
-----------------------------------------------------------------------------------
Government Bonds $ .50 $ .50 $ .25 (a)
-----------------------------------------------------------------------------------
Mortgage-Backed (evaluated, seasoned, .50 .50 .25 (a)
closing)
-----------------------------------------------------------------------------------
Corporate Bonds (short and long term) .50 .50 .25 (a)
-----------------------------------------------------------------------------------
U.S. Municipal Bonds (short and long .55 .80 .50 (b)
term)
-----------------------------------------------------------------------------------
CMO's/ARM's/ABS 1.00 .80 1.00 (a)
-----------------------------------------------------------------------------------
Convertible Bonds .50 .50 1.00 (a)
-----------------------------------------------------------------------------------
High Yield Bonds .50 .50 1.00 (a)
-----------------------------------------------------------------------------------
Mortgage-Backed Factors (per Issue per 1.00 n/a n/a
Month)
-----------------------------------------------------------------------------------
Domestic Equities (d) .15 n/a
-----------------------------------------------------------------------------------
Domestic Options n/a .15 n/a
-----------------------------------------------------------------------------------
Domestic Dividends & Capital Changes
(per Issue per Month) (d) 3.50 n/a
-----------------------------------------------------------------------------------
Foreign Securities .50 .50 n/a
-----------------------------------------------------------------------------------
Foreign Securities Dividends & Capital
Changes 2.00 4.00 n/a
(per Issue per Month)
-----------------------------------------------------------------------------------
Set-up Fees n/a n/a (e) .25 (c)
-----------------------------------------------------------------------------------
All Added Items n/a n/a .25 (c)
-----------------------------------------------------------------------------------
* Based on current Vendor costs, subject to change. Costs are quoted
based on individual security CUSIP/identifiers and are per issue
per day.
(a) $35.00 per day minimum
(b) $25.00 per day minimum
(c) $ 1.00, if no CUSIP
(d) At no additional cost to FPS clients
(e) Interactive Data also charges monthly transmission cost and
disk storage charges.
A) Futures and Currency Forward Contracts $2.00 per Issue per Day
B) Telerate Systems, Inc.* (if applicable)
*Based on current vendor costs, subject to change.
Specific costs will be identified based upon options selected by
Wood, Xxxxxxxxx & Winthrop and will be billed monthly.
C) Reuters, Inc.*
*Based on current vendor costs, subject to change.
FPS does not currently pass along the charges for the domestic
security prices supplied by Reuters, Inc.
D) Municipal Market Data*
*Based on current vendor costs, subject to change
Specific costs will be identified based upon options selected by
Wood, Xxxxxxxxx & Winthrop and will be billed monthly.
II. OUT-OF-POCKET EXPENSES
The Funds will reimburse FPS Services, Inc. monthly for all
reasonable out-of- pocket expenses, including telephone, postage,
overdraft charges, telecommunications, special reports, record
retention, special transportation costs, copying and sending materials
to auditors and/or regulatory agencies as incurred and approved.
III. ADDITIONAL SERVICES
To the extent the Funds commence using investment techniques such
as Futures, Security Lending, Swaps, Leveraging, Short Sales,
Derivatives, Precious Metals, or foreign trading (non U.S. dollar
denominated securities and currency), additional fees will apply.
Activities of a non-recurring nature such as shareholder inkinds, fund
consolidations, mergers or reorganizations will be subject to
negotiation. Any additional/enhanced services, programming requests, or
reports will be quoted upon request.
