Exhibit 23H(2)
MUTUAL FUND SERVICES AGREEMENT
Fund Administration Services
Fund Accounting Services
Transfer Agency Services
between
AVALON FUNDS, INC.,
AVALON TRUST COMPANY
and
UNIFIED FUND SERVICES, INC.
DECEMBER 1, 2000
Exhibit A - Portfolio Listing
Exhibit B - Fund Administration Services Description
Exhibit C - Fund Accounting Services Description
Exhibit D - Transfer Agency Services Description
Exhibit E - Fees and Expenses
MUTUAL FUND SERVICES AGREEMENT
AGREEMENT (this "Agreement"), dated as of December 1, 2000, between the
Avalon Funds, Inc., a Maryland corporation (the "Fund"), Avalon Trust Company, a
regulated trust company operating under the laws of the state of New Mexico
("Avalon"), and Unified Fund Services, Inc., a Texas corporation ("Unified").
WITNESSTH:
WHEREAS, the Fund is registered as an open-end, management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act");
and
WHEREAS, the Fund has entered into an Operating Services Agreement with
Avalon wherein Avalon is responsible for providing certain accounting, transfer
agency and administrative services to the Fund; and
WHEREAS, Avalon wishes to retain Unified to provide certain transfer agent,
fund accounting and administration services with respect to the Fund, Unified is
willing to furnish such services, and the Fund consents to the appointment of
Unified to provide such services;
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein, the parties hereto hereby agree as follows:
SECTION 1. Appointment. Avalon, with the Fund's express consent, hereby
appoints Unified to provide transfer agent, fund accounting and fund
administration services for the Fund, subject to the supervision of the Board of
Directors of the Fund (the "Board"), for the period and on the terms set forth
in this Agreement. Unified accepts such appointment and agrees to furnish the
services herein set forth in return for the compensation as provided in Section
6 and Exhibit E to this Agreement. The Fund will initially consist of the
portfolios, funds and/or classes of shares (each a "Portfolio"; collectively the
"Portfolios") listed on Exhibit A. The Fund shall notify Unified in writing of
each additional Portfolio established by the Fund. Each new Portfolio shall be
subject to the provisions of this Agreement, except to the extent that the
provisions (including those relating to the compensation and expenses payable by
the Fund and its Portfolios) may be modified with respect to each new Portfolio
in writing by the Fund and Unified at the time of the addition of the new
Portfolio.
SECTION 2. Representations and Warranties of Unified. Unified represents
and warrants to the Fund and Avalon that:
(a) Unified is a corporation duly organized and existing under the laws of
the State of Texas;
(b) Unified is empowered under applicable laws and by its Articles of
Incorporation and By-Laws to enter into and perform this Agreement, and all
requisite corporate proceedings have been taken by Unified to authorize Unified
to enter into and perform this Agreement;
(c) Unified has, and will continue to have, access to the facilities,
personnel and equipment required to fully perform its duties and obligations
hereunder;
(d) no legal or administrative proceedings have been instituted or
threatened against Unified that would impair its ability to perform its duties
and obligations under this Agreement; and
(e) Unified's entrance into this Agreement will not cause a material breach
or be in material conflict with any other agreement or obligation of Unified or
any law or regulation applicable to Unified.
SECTION 3. Representations and Warranties of the Fund and Avalon. The Fund
represents and warrants to Unified that:
(a) the Fund is a corporation duly organized and existing under the laws of
the State of Maryland;
(b) the Fund is empowered under applicable laws and by its Amended and
Restated Articles of Incorporation and By-Laws to enter into and perform this
Agreement, and the Fund has taken all requisite proceedings to authorize the
Fund to enter into and perform this Agreement;
(c) the Fund is an investment company properly registered under the 1940
Act; a registration statement under the Securities Act of 1933, as amended
("1933 Act") and the 1940 Act on Form N-lA has been filed and will be effective
and will remain effective during the term of this Agreement, and all necessary
filings under the laws of the states will have been made and will be current
during the term of this Agreement;
(d) no legal or administrative proceedings have been instituted or
threatened against the Fund that would impair its ability to perform its duties
and obligations under this Agreement; and
(e) the Fund's entrance into this Agreement will not cause a material
breach or be in material conflict with any other agreement or obligation of the
Fund or any law or regulation applicable to it.
Avalon represents and warrants to Unified that:
(a) Avalon is a private trust company duly organized, existing and
regulated under the laws of the State of New Mexico;
(b) Avalon is empowered under applicable laws and by its Organizational
documents to enter into and perform this Agreement, and Avalon has taken all
requisite proceedings required to enter into and perform this Agreement;
(c) no legal or administrative proceedings have been instituted or
threatened against Avalon that would impair its ability to perform its duties
and obligations under this Agreement; and
(d) Avalon's entrance into this Agreement will not cause a material breach
or be in material conflict with any other agreement or obligation of the Fund or
any law or regulation applicable to it.
SECTION 4. Delivery of Documents. The Fund will promptly furnish to Unified
such copies, properly certified or authenticated, of contracts, documents and
other related information that Unified may request or requires to properly
discharge its duties. Such documents may include but are not limited to the
following:
(a) Resolutions of the Board authorizing the appointment of Unified to
provide certain transfer agency, fund accounting and administration services to
the Fund and approving this Agreement;
(b) The Fund's Amended and Restated Articles of Incorporation;
(c) The Fund's Amended and Restated By-Laws;
(d) The Fund's Notification of Registration on Form N-8A under the 1940 Act
as filed with the Securities and Exchange Commission ("SEC");
(e) The Fund's registration statement including exhibits, as amended, on
Form N-1A (the "Registration Statement") under the 1933 Act and the 1940 Act, as
filed with the SEC;
(f) Copies of the Management Agreement between the Fund and its investment
adviser (the "Advisory Agreement");
(g) Opinions of counsel and auditors reports;
(h) The Fund's Prospectus and Statement of Additional Information relating
to all Portfolios and all amendments and supplements thereto (such Prospectus
and Statement of Additional Information and supplements thereto, as presently in
effect and as from time to time hereafter amended and supplemented, herein
called the "Prospectuses"); and
(i) Such other agreements as the Fund may enter into from time to time,
including securities lending agreements, futures and commodities account
agreements, brokerage agreements, and options agreements.
SECTION 5. Services Provided by Unified.
(a) Unified will provide the following services subject to the control,
direction and supervision of the Board and in compliance with the objectives,
policies and limitations set forth in the Fund's Registration Statement,
Declaration of Trust and By-Laws; applicable laws and regulations; and all
resolutions and policies implemented by the Board:
(i) Fund Administration, as described on Exhibit B to this Agreement.
(ii) Fund Accounting, as described on Exhibit C to this Agreement.
(iii) Transfer Agency, as described on Exhibit D to this Agreement.
(iv) Dividend Disbursing. Unified will serve as the Fund's dividend
disbursing agent. Unified will prepare and mail checks, place wire transfers of
credit income and capital gain payments to shareholders. The Fund will advise
Unified in advance of the declaration of any dividend or distribution and the
record and payable date thereof. Unified will, on or before the payment date of
any such dividend or distribution, notify the Fund's Custodian of the estimated
amount required to pay any portion of such dividend or distribution payable in
cash, and on or before the payment date of such distribution, the Fund will
instruct its Custodian to make available to Unified sufficient funds for the
cash amount to be paid out. If a shareholder is entitled to receive additional
shares by virtue of any such distribution or dividend, appropriate credits will
be made to each shareholder's account and/or certificates delivered where
requested. A shareholder not receiving certificates will receive a confirmation
from Unified indicating the number of shares credited to his/her account.
(b) Unified will also:
(i) provide office facilities with respect to the provision of the services
contemplated herein (which may be in the offices of Unified or a corporate
affiliate of Unified);
(ii) provide or otherwise obtain personnel sufficient, in Unified's sole
discretion, for provision of the services contemplated herein;
(iii) furnish equipment and other materials, which Unified, in its sole
discretion, believes are necessary or desirable for provision of the services
contemplated herein; and
(iv) keep records relating to the services provided hereunder in such form
and manner as set forth on Exhibits B, C and D and as Unified may otherwise deem
appropriate or advisable, all in accordance with the 1940 Act. To the extent
required by Section 31 of the 1940 Act and the rules thereunder, Unified agrees
that all such records prepared or maintained by Unified relating to the services
provided hereunder are the property of the Fund and will be preserved for the
periods prescribed under Rule 31a-2 under the 1940 Act, maintained at the Fund's
expense, and made available in accordance with such Section and rules. Unified
further agrees to surrender promptly to the Fund upon its request and cease to
retain in its records and files those records and documents created and
maintained by Unified pursuant to this Agreement.
SECTION 6. Fees: Expenses: Expense Reimbursement.
(a) As compensation for the services rendered to the Fund pursuant to this
Agreement, Avalon shall pay Unified monthly fees determined as set forth on
Exhibit E to this Agreement. Such fees are to be billed monthly and shall be due
and payable upon receipt of the invoice. Upon any termination of this Agreement
and before the end of any month, the fee for the part of the month before such
termination shall be equal to the fee normally due for the full monthly period
and shall be payable upon the date of termination of this Agreement.
(b) For the purpose of determining fees calculated as a function of a
Portfolio's net assets, the value of the Portfolio's net assets shall be
computed as required by the Prospectus, generally accepted accounting
principles, and resolutions of the Board.
(c) Unified will from time to time employ or associate with such person or
persons as may be appropriate to assist Unified in the performance of this
Agreement. Such person or persons may be officers and employees who are employed
or designated as officers by both Unified and the Fund. The compensation of such
person or persons for such employment shall be paid by Unified and no obligation
will be incurred by or on behalf of the Fund or Avalon in such respect.
(d) Unified will bear all of its own expenses in connection with the
performance of the services under this Agreement except as otherwise expressly
provided herein. Avalon agrees to promptly reimburse Unified for any equipment
and supplies specially ordered by or for the Fund through Unified and for any
other expenses not contemplated by this Agreement that Unified may incur on the
Fund's behalf at the Fund's request or as consented to by the Fund or Avalon.
Such other expenses to be incurred in the operation of the Fund and to be borne
by the Fund, include, but are not limited to: taxes; interest; brokerage fees
and commissions; salaries and fees of officers and directors who are not
officers, directors, shareholders or employees of Unified, or the Fund's
investment adviser or distributor; SEC and state Blue Sky registration and
qualification fees, levies, fines and other charges; advisory fees; charges and
expenses of custodians; insurance premiums including fidelity bond premiums;
auditing and legal expenses; costs of maintenance of corporate existence;
expenses of typesetting and printing of prospectuses and for distribution to
current shareholders of the Fund; expenses of printing and production cost of
shareholders' reports and proxy statements and materials; costs and expense of
Fund stationery and forms; costs and expenses of special telephone and data
lines and devices; costs associated with corporate, shareholder, and Board
meetings; and any extraordinary expenses and other customary Fund expenses. In
addition, Unified may utilize one or more independent pricing services, approved
from time to time by the Board, to obtain securities prices and to act
as backup to the primary pricing services, in connection with determining the
net asset values of the Fund, and the Fund will reimburse Unified for the Fund's
share of the cost of such services based upon the actual usage, or a pro-rata
estimate of the use, of the services for the benefit of the Fund.
(e) The Fund or Avalon may request additional services, additional
processing, or special reports. Such requests may be provided by Unified at
additional charges. In this event, the Fund shall submit such requests in
writing together with such specifications as may be reasonably required by
Unified, and Unified shall respond to such requests in the form of a price
quotation. The Fund's written acceptance of the quotation must be received prior
to implementation of such request. Additional services will be charged at
Unified's standard rates.
(f) All fees, out-of-pocket expenses, or additional charges of Unified
shall be billed on a monthly basis and shall be due and payable upon receipt of
the invoice.
Unified will render, after the close of each month in which services have been
furnished, a statement reflecting all of the charges for such month. Charges
remaining unpaid after thirty (30) days shall bear interest in finance charges
equivalent to, in the aggregate, the Prime Rate (as publicly announced by
Firstar Bank, N.A., from time to time) plus 2.00% per year and all costs and
expenses of effecting collection of any such sums, including reasonable
attorney's fees, shall be paid by the Fund to Unified.
In the event that Avalon is more than sixty (60) days delinquent in its payments
of monthly xxxxxxxx in connection with this Agreement (with the exception of
specific amounts which may be contested in good faith by Avalon or the Fund),
this Agreement may be terminated upon thirty (30) days' written notice to the
Fund by Unified. The Fund or Avalon must notify Unified in writing of any
contested amounts within thirty (30) days of receipt of a billing for such
amounts. Disputed amounts are not due and payable while they are being
investigated.
SECTION 7. Proprietary and Confidential Information. Unified agrees on
behalf of itself and its employees to treat confidentially and as proprietary
information of the Fund, all records and other information relative to the
Fund's prior, present or potential shareholders, and to not use such records and
information for any purpose other than performance of Unified's responsibilities
and duties hereunder. Unified may seek a waiver of such confidentiality
provisions by furnishing reasonable prior notice to the Fund and obtaining
approval in writing from the Fund, which approval shall not be unreasonably
withheld and may not be withheld where the service agent may be exposed to civil
or criminal contempt proceedings for failure to comply, when requested to
divulge such information by duly constituted authorities. Waivers of
confidentiality are automatically effective without further action by Unified
with respect to Internal Revenue Service levies, subpoenas and similar actions,
or with respect to any request by the Fund.
SECTION 8. Duties, Responsibilities and Limitations of Liability.
(a) In the performance of its duties hereunder, Unified shall be obligated
to exercise due care and diligence, and to act in good faith in performing the
services provided for under this Agreement. In performing its services
hereunder, Unified shall be entitled to rely on any oral or written
instructions, notices or other communications from the Fund, Avalon and its
custodian, officers and Directors, investors, agents and other service providers
which Unified reasonably believes to be genuine, valid and authorized. Unified
shall also be entitled to consult with and rely on the advice and opinions of
outside legal counsel retained by the Fund, as necessary or appropriate.
(b) Unified shall not be liable for any error of judgment or mistake of law
or for any loss or expense suffered by the Fund, in connection with the matters
to which this Agreement relates, except for a loss or
expense solely caused by or resulting from willful misfeasance, bad faith or
negligence on Unified's part in the performance of its duties or from reckless
disregard by Unified of its obligations and duties under this Agreement. Any
person, even though also an officer, director, partner, employee or agent of
Unified, who may be or become an officer, director, partner, employee or agent
of the Fund, shall be deemed when rendering services to the Fund or acting on
any business of the Fund (other than services or business in connection with
Unified's duties hereunder) to be rendering such services to or acting solely
for the Fund and not as an officer, director, partner, employee or agent or
person under the control or direction of Unified even though paid by Unified.
(c) Except for a loss or expense solely caused by or resulting from willful
misfeasance, bad faith or negligence on Unified's part in the performance of its
duties or from reckless disregard by Unified of its obligations and duties under
this Agreement, Unified shall not be responsible for, and the Fund shall
indemnify and hold Unified harmless from and against, any and all losses,
damages, costs, reasonable attorneys' fees and expenses, payments, expenses and
liabilities arising out of or attributable to:
(i) all actions of Unified or its officers or agents required to be taken
pursuant to this Agreement;
(ii) the reliance on or use by Unified or its officers or agents of
information, records, or documents which are received by Unified or its officers
or agents and furnished to it or them by or on behalf of the Fund, and which
have been prepared or maintained by the Fund or any third party on behalf of the
Fund;
(iii) the Fund's or Avalon's refusal or failure to comply with the terms of
this Agreement or the Fund's or Avalon's lack of good faith, or its actions, or
lack thereof involving negligence or willful misfeasance;
(iv) the breach of any representation or warranty of the Fund hereunder;
(v) the taping or other form of recording of telephone conversations or
other forms of electronic communications with investors and shareholders, or
reliance by Unified on telephone or other electronic instructions of any person
acting on behalf of a shareholder or shareholder account for which telephone or
other electronic services have been authorized;
(vi) the reliance on or the carrying out by Unified or its officers or
agents of any proper instructions reasonably believed to be duly authorized, or
requests of the Fund or recognition by Unified of any share certificates which
are reasonably believed to bear the proper signatures of the officers of the
Fund and the proper countersignature of any transfer agent or registrar of the
Fund;
(vii) any delays, inaccuracies, errors in or omissions from data provided
to Unified by data and pricing services;
(viii) the offer or sale of shares by the Fund in violation of any
requirement under the federal securities laws or regulations or the securities
laws or regulations of any state, or in violation of any stop order or other
determination or ruling by any federal agency or any state agency with respect
to the offer or sale of such shares in such state (1) resulting from activities,
actions, or omissions by the Fund or its other service providers and agents, or
(2) existing or arising out of activities, actions or omissions by or on behalf
of the Fund prior to the effective date of this Agreement; and
(ix) the compliance by the Fund, its investment adviser, and its
distributor with applicable securities, tax, commodities and other laws, rules
and regulations.
SECTION 9. Terms. This Agreement shall become effective on the date first
herein above written. This Agreement may be modified or amended from time to
time by mutual agreement between the parties hereto. This Agreement shall
continue in effect unless terminated by either party on at least ninety (90)
days' prior written notice. Upon termination of this Agreement, the Fund shall
pay to Unified such compensation and any reimbursable expenses as may be due
under the terms hereof as of the date of termination or the date that the
provision of services ceases, whichever is sooner.
Should the Fund exercise its right to terminate this Agreement, Avalon
agrees to pay a termination/conversion fee, simultaneous with the transfer of
all Fund records to the successor mutual fund service provider(s), in an amount
equal to the total compensation under this agreement for the 60 day period
immediately preceding the termination notice date. In addition, the Fund agrees
to pay for all conversion tape set-up fees, test conversion preparation and
processing fees and final conversion fees.
Such compensation to Unified shall be for the expenses incurred in
connection with the retrieval, compilation and movement of books, records and
materials relative to the deconversion or conversion of Fund records to the
successor mutual fund service provider as directed by the Fund. Notwithstanding
the foregoing, any amount owed by Avalon to Unified prior to the
termination/conversion shall still be due and payable under the terms of this
Agreement. No such compensation shall be due to Unified if Unified terminates
this Agreement for reasons other than a default by Avalon.
Upon the termination of the Agreement for any reason, Unified agrees to
provide the Fund with complete and accurate transfer agency, fund accounting and
administration records and to assist the Fund in the orderly transfer of
accounts and records. Without limiting the generality of the foregoing, Unified
agrees upon termination of this Agreement:
(a) to deliver to the successor mutual fund service provider(s), computer
tapes containing the Fund's accounts and records together with such record
layouts and additional information as may be necessary to enable the successor
mutual fund service provider(s) to utilize the information therein;
(b) to cooperate with the successor mutual fund service provider(s) in the
interpretation of the Fund's account and records;
(c) to forward all shareholder calls, mail and correspondence to the new
mutual fund service provider(s) upon de-conversion; and
(d) to act in good faith, to make the conversion as smooth as possible for
the successor mutual fund service provider(s) and the Fund.
SECTION 10. Notices. Any notice required or permitted hereunder shall be in
writing and shall be deemed to have been given when delivered in person or by
certified mail, return receipt requested, to the parties at the following
address (or such other address as a party may specify by notice to the other):
(a) If to the Fund or Avalon, to:
000 Xxxxxxx Xxxxxx, Xxxxx 000
Xxxxx Xx, Xxx Xxxxxx 00000
Attention: President
(b) If to Unified, to:
Unified Fund Services, Inc.
000 Xxxxx Xxxxxxxxxxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxx 00000
Attention: President
Notice shall be effective upon receipt if by mail, on the date of personal
delivery (by private messenger, courier service or otherwise) or upon confirmed
receipt of telex or facsimile, whichever occurs first.
SECTION 11. Assignability. This Agreement shall not be assigned by either
party hereto without the prior written consent of the other party.
SECTION 12. Waiver. The failure of a party to insist upon strict adherence
to any term of this Agreement on any occasion shall not be considered a waiver
nor shall it deprive such party of the right thereafter to insist upon strict
adherence to that term or any term of this Agreement. Any waiver must be in
writing signed by the waiving party.
SECTION 13. Force Majeure. Unified shall not be responsible or liable for
any failure or delay in performance of its obligations under this Agreement
arising out of or caused, directly or indirectly, by circumstances beyond its
control, including without limitations, acts of God, earthquake, fires, floods,
wars, acts of civil or military authorities, or governmental actions, nor shall
any such failure or delay give the Fund the right to terminate this Agreement.
SECTION 14. Use or Name. The Fund, Avalon and Unified agree not to use the
other's name nor the names of such other's affiliates, designees, or assignees
in any prospectus, sales literature, or other printed material written in a
manner not previously, expressly approved in writing by the other or such
other's affiliates, designees, or assignees except where required by the SEC or
any state agency responsible for securities regulation.
SECTION 15. Amendments. This Agreement may be modified or amended from time
to time by mutual written agreement between the parties. No provision of this
Agreement may be changed, discharged, or terminated orally, but only by an
instrument in writing signed by the party against which enforcement of the
change, discharge or termination is sought.
SECTION 16. Severability. If any provision of this Agreement is invalid or
unenforceable, the balance of the Agreement shall remain in effect, and if any
provision is inapplicable to any person or circumstance it shall nevertheless
remain applicable to all other persons and circumstances.
SECTION 17. Governing Law. This Agreement shall be governed by the laws of
the State of Indiana.
IN WITNESS WHEREOF, the parties hereto have caused this Mutual Fund
Services Agreement to be signed by their respective duly authorized officers as
of the day and year first above written.
AVALON FUNDS, INC.
By: Date
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Print Name:
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Title:
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Attest:
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UNIFIED FUND SERVICES, INC.
By: Date
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Print Name:
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Title:
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By: Date
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Print Name:
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Title:
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Attest:
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AVALON TRUST COMPANY
By: Date
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Print Name:
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Title:
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Attest:
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EXHIBIT A
to
Mutual Fund Services Agreement
List of Portfolios
------------------
The Education Fund
EXHIBIT B
to
Mutual Fund Services Agreement
General Description of Fund Administration Services
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I. Financial and Tax Reporting
---------------------------
A. Prepare agreed upon management reports and Board of Directors materials
such as unaudited financial statements, distribution summaries, and
deviations of xxxx-to-market valuation and the amortized cost for money
market funds.
B. Report Fund performance to outside services as directed by Fund management.
C. Prepare and file Fund's Form N-SAR with the SEC.
D. Prepare and coordinate printing of Fund's Semiannual and Annual Reports to
Shareholders.
E. In conjunction with transfer agent, notify shareholders as to what portion,
if any, of the distributions made by the Fund's during the prior fiscal
year were exempt-interest dividends under Section 852(b)(5)(A) of the Code.
F. Provide Form 1099-MISC to persons other than corporations (i.e., Directors)
to whom the Fund paid more than $600 during the year.
G. Provide financial information for Fund proxy statements and Prospectuses
(Expense Table).
II. Portfolio Compliance
--------------------
A. Assist with monitoring each Portfolio's compliance with investment
restrictions (e.g., issuer or industry diversification, etc.) listed in the
current Prospectus and Statement of Additional Information.
B. Assist with monitoring each Portfolio's compliance with the requirements of
Section 851 of the Code for qualification as a RIC (i.e., 90% Income and
Diversification Tests).
C. Assist with monitoring investment manager's compliance with Board
directives such as "Approved Issuers Listings for Repurchase Agreements",
Rule 17a-7, and Rule 12d-3 procedures.
D. Administer compliance by the Fund's Directors, officers and "access
persons" under the terms of the Fund's Code of Ethics and SEC regulations.
III. Regulatory Affairs and Corporate Governance
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A. Assist Fund counsel in the preparation and filing of post-effective
amendments to the Fund's registration statement on Form N-lA and
supplements as needed.
B. Administer shareholder meetings, and assist Fund counsel in the preparation
and filing of proxy materials.
C. Prepare and file Rule 24f-2 Notices.
D. Prepare and file all state notifications of intent to sell the Fund's
securities including annual renewals, adding new Portfolios, preparing and
filing sales reports, filing copies of the registration statement and final
prospectus and statement of additional information, and increasing
registered amounts of securities in individual states.
E. Prepare Board materials for all Board meetings.
F. Assist with the review and monitoring of fidelity bond and errors and
omissions insurance coverage and make any related regulatory filings.
G. Prepare and update documents such as charter document, By-Laws, foreign
qualification filings.
H. Assist in identifying and monitoring pertinent regulatory and legislative
developments which may affect the Fund and, in response to the results of
such monitoring, coordinate and provide support to the Fund and the Fund's
investment adviser with respect to those developments and results,
including support with respect to routine regulatory examinations or
investigations of the Fund, and with respect to such matters, to work in
conjunction with outside counsel, auditors and other professional
organizations engaged by the Fund.
I. File copies of financial reports to shareholders with the SEC under Rule
30b2-1.
IV. General Administration
----------------------
A. For new Portfolios obtain Employer Identification Number and CUSIP numbers.
Estimate organizational costs and expenses and monitor against actual
disbursements.
B. Coordinate all communications and data collection with regard to any
regulatory examinations and yearly audits by independent accountants.
EXHIBIT C
to
Mutual Fund Services Agreement
Description of Fund Accounting Services
---------------------------------------
I. General Description
-------------------
Unified shall provide the following accounting services to the Fund:
A. Calculate dividend and capital gain distributions in accordance with
distribution policies detailed in the Fund's Prospectus. Assist Fund
management in making final determinations of distribution amounts.
B. Estimate and recommend year-end dividend and capital gain distributions
necessary to establish Fund's status as a regulated investment company
("RIC") under Section 4982 of the Internal revenue Code of 1986, as amended
(the "Code") regarding minimum distribution requirements.
C. Assist the Fund's public accountants or other professionals in preparing
and file Fund's Federal tax return on Form 1120-RIC along with all state
and local tax returns where applicable. Also assist in Preparing and filing
Federal Excise Tax Return (Form 8613).
D. Maintain the books and records and accounting controls for the Fund's
assets, including records of all securities transactions.
E. Calculate each Portfolio's net asset value in accordance with the
Prospectus and (once the Portfolio meets eligibility requirements) transmit
to NASDAQ and to such other entities as directed by the Fund.
F. Account for dividends and interest received and distributions made by the
Fund.
G. Prepare Fund or Portfolio expense projections, establish accruals and
review on a periodic basis, including expenses based on a percentage of
Fund's average daily net assets (advisory and administrative fees) and
expenses based on actual charges annualized and accrued daily (audit fees,
registration fees, directors' fees, etc.).
H. Produce transaction data, financial reports and such other periodic and
special reports as the Board may reasonably request.
I. Liaison with the Fund's independent auditors.
J. Monitor and administer arrangements with the Fund's Custodian and
depository banks.
K. A listing of reports that will be available to the Fund is included below.
II. Daily Reports
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A. General Ledger Reports
1. Trial Balance Report
2. General Ledger Activity Report
B. Portfolio Reports
1. Portfolio Report
2. Cost Lot Report
3. Purchase Journal
4. Sell/Maturity Journal
5. Amortization/Accretion Report
6. Maturity Projection Report
C. Pricing Reports
1. Pricing Report
2. Pricing Report by Market Value
3. Pricing Variance by % Change
4. NAV Report
5. NAV Proof Report
6. Money Market Pricing Report
D. Accounts Receivable/Payable Reports
1. Accounts Receivable for Investments Report
2. Accounts Payable for Investments Report
3. Interest Accrual Report
4. Dividend Accrual Report
E. Other Reports
1. Dividend Computation Report
2. Cash Availability Report
3. Settlement Journal
IV. Monthly Reports
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Standard Reports
1. Cost Proof Report
2. Transaction History Report
3. Realized Gain/Loss Report
4. Interest Record Report
5. Dividend Record Report
6. Broker Commission Totals
7. Broker Principal Trades
8. Shareholder Activity Report
9. Fund Performance Report
10. SEC Yield Calculation Work Sheet (fixed-income funds only)
EXHIBIT D
to
Mutual Fund Services Agreement
Description of Transfer Agency Services
---------------------------------------
The following is a general description of the transfer agency services
Unified shall provide to the Fund.
A. Shareholder Recordkeeping. Maintain records showing for each Fund
shareholder the following: (i) name, address and tax identifying number;
(ii) number of shares of each Portfolio; (iii) historical information
including, but not limited to, dividends paid and date and price of all
transactions including individual purchases and redemptions; and (iv) any
dividend reinvestment order, application, dividend address and
correspondence relating to the current maintenance of the account.
B. Shareholder Issuance. Record the issuance of shares of each Portfolio.
Except as specifically agreed in writing between Unified and the Fund,
Unified shall have no obligation when countersigning and issuing and/or
crediting shares to take cognizance of any other laws relating to the issue
and sale of such shares except insofar as policies and procedures of the
Stock Transfer Association recognize such laws.
C. Purchase Orders. Process all orders for the purchase of shares of the Fund
in accordance with the Fund's current registration statement. Upon receipt
of any check or other payment for purchase of shares of the Fund from an
investor, Unified will (i) stamp the envelope with the date of receipt,
(ii) forthwith process the same for collection, (iii) determine the amounts
thereof due the Fund, and notify the Fund of such determination and
deposit, such notification to be given on a daily basis of the total
amounts determined and deposited to the Fund's custodian bank account
during such day. Unified shall then credit the share account of the
investor with the number of Portfolio shares to be purchased made on the
date such payment is received by Unified, as set forth in the Fund's
current prospectus and shall promptly mail a confirmation of said purchase
to the investor, all subject to any instructions which the Fund may give to
Unified with respect to the timing or manner of acceptance of orders for
shares relating to payments so received by it.
D. Redemption Orders. Receive and stamp with the date of receipt all requests
for redemptions or repurchase of shares held in certificate or
non-certificate form, and process redemptions and repurchase requests as
follows: (i) if such certificate or redemption request complies with the
applicable standards approved by the Fund, Unified shall on each business
day notify the Fund of the total number of shares presented and
covered by such requests received by Unified on such day; (ii) on or prior
to the seventh calendar day succeeding any such requests received by
Unified, Unified shall notify the Custodian, subject to instructions from
the Fund, to transfer monies to such account as designated by Unified for
such payment to the redeeming shareholder of the applicable redemption or
repurchase price; (iii) if any such certificate or request for redemption
or repurchase does not comply with applicable standards, Unified shall
promptly notify the investor of such fact, together with the reason
therefor, and shall effect such redemption at the Fund's price next
determined after receipt of documents complying with said standards, or, at
such other time as the Fund shall so direct.
E. Telephone Orders. Process redemptions, exchanges and transfers of Fund
shares upon telephone instructions from qualified shareholders in
accordance with the procedures set forth in the Fund's current Prospectus.
Unified shall be permitted to redeem, exchange and/or transfer Fund shares
from any account for which such services have been authorized.
F. Transfer of Shares. Upon receipt by Unified of documentation in proper form
to effect a transfer of shares, including in the case of shares for which
certificates have been issued the share certificates in proper form for
transfer, Unified will register such transfer on the Fund's shareholder
records maintained by Unified pursuant to instructions received from the
transferor, cancel the certificates representing such shares, if any, and
if so requested, countersign, register, issue and mail by first class mail
new certificates for the same or a smaller whole number of shares.
G. Shareholder Communications and Meetings. Address and mail all
communications by the Fund to its shareholders promptly following the
delivery by the Fund of the material to be mailed. Prepare shareholder
lists, mail and certify as to the mailing of proxy materials, receive the
tabulated proxy cards, render periodic reports to the Fund on the progress
of such tabulation, and provide the Fund with inspectors of election at any
meeting of shareholders.
H. Share Certificates. If the Fund issues certificates, and if a shareholder
of the Fund requests a certificate representing his shares, Unified as
Transfer Agent, will countersign and mail by first class mail with receipt
confirmed, a share certificate to the investor at his/her address as it
appears on the Fund's transfer books. Unified shall supply, at the expense
of the Fund, a supply of blank share certificates. The certificates shall
be properly signed, manually or by facsimile, as authorized by the Fund,
and shall bear the Fund's seal or facsimile; and notwithstanding the death,
resignation or removal of any officers of the Fund authorized to sign
certificates, Unified may, until otherwise directed by the Fund, continue
to countersign certificates which bear the manual or facsimile signature of
such officer.
I. Returned checks. In the event that any check or other order for the payment
of money is returned unpaid for any reason, Unified will take such steps,
including redepositing the check for collection or returning the check to
the investor, as Unified may, at its discretion, deem appropriate and
notify the Fund of such action, or as the Fund may instruct.
J. Shareholder Correspondence. Acknowledge all correspondence from
shareholders relating to their share accounts and undertake such other
shareholder correspondence as may from time to time be mutually agreed
upon.
EXHIBIT E
to
Mutual Fund Services Agreement
TRANSFER AGENCY FEE SCHEDULE
The prices contained herein are effective for twelve months from the
execution date of the Transfer Agency contract.
I CONVERSION FEE: Manual conversion/new fund establishment - fee not to exceed
---------------- $1,500 per portfolio. Electronic conversions - $1.50 per
shareholder account with a $4,000 minimum fee.
II STANDARD BASE FEE FOR STANDARD BASE SERVICES
-------------------------------------------------
The Base Fee1 is $18.00 for money market funds and $15.60 for equity/bond
funds per active Shareholder Account per year with a minimum fee of
$15,0002 per initial portfolio and/or share classes per year plus $9,0002
per year for each additional portfolio/share class. An Active Shareholder
Account is any Shareholder Account existing on Transfer Agent's
computerized files with a non-zero Share balance. There is a $.40 per
account charge for any account with a zero share balance for the current
month, as determined on the last day of each month. The base fee will be
billed on a monthly basis.
1The Base Fee does not include: forms design and printing, statement
production, envelope design and printing, postage and handling,
shipping, statement microfiche copies and 800 number access to
Unified's shareholder services group.
2 Discount based on total fund assets:
$0 - 2 Million 30%
$2 - 5 Million 20%
$5 Plus Million 0%
Unified will provide lost account search services in connection of SEC
Rules 17Ad-17 and 17a-24 at a cost of $2.50 per account searched. These
"Electronic Data Search Services" will be performed on a semi-annual basis.
This service will apply to only Active Shareholder Accounts maintained on
the transfer agency system coded as RPO accounts.
In addition to the above fees, there will be a $200.00 per day minimum
fee/rerun charge when the nightly processing has to be repeated due to incorrect
NAV or dividend information received from the Portfolio Pricing Agent due to
incorrect or untimely information provided by an Advisor or its Agent.
III STANDARD SERVICES PROVIDED
-------------------------------
-Open new accounts
-Maintain Shareholder accounts
INCLUDING:
-Maintain certificate records
-Change addresses
-Prepare daily reports on number of Shares, accounts
-Prepare Shareholder federal tax information
-Withhold taxes on U.S. resident and non-resident alien accounts
-Reply to Shareholder calls and correspondence other than that for
Fund information and related inquiries
-Process purchase of Shares
-Issue/Cancel certificates (Excessive use may be subject to additional
charges)
-Process partial and complete redemptions
-Process regular and legal transfer of accounts
-Mail semi-annual and annual reports
-Process dividends and distributions
-Prepare Shareholder meeting lists
-Process one proxy per year per fund. Tabulation is limited to three.
-Receive and tabulate proxies
-Confirm all transactions as provided by the terms of each Shareholder's
account
-Provide a system which will enable Fund to monitor the total number of
Shares sold in each state. System has capability to halt sales and warn of
potential oversell. (Blue Sky Reports)
-Determine/Identify lost Shareholder accounts
IV STANDARD REPORTS AVAILABLE
-------------------------------
-12b-1 Disbursement Report
-12b-1 Disbursement Summary
-Dealer Commission Report
-Dealer Commission Summary Report
-Exchange Activity Report
-Fees Paid Summary Report
-Fund Accrual Details
-Holdings by Account Type
-Posting Details
-Posting Summary
-Settlement Summary
-Tax Register
-Transactions Journal
V NSCC INTERFACES
--------------------
-Fund/Serv and/or Networking set-up $1,000
-Fund/Serv processing $150 per month
-Networking processing $250 per month
-Fund/Serv transactions $0.35 per trade
-Direct Networking expenses
Per item $0.025 Monthly dividend fund
Per item $0.015 Non-monthly dividend fund
VI ADDITIONAL FEES FOR SERVICES OUTSIDE THE STANDARD BASE
-----------------------------------------------------------
-Interactive Voice Response System Set-up Pass through
-Archiving of old records/storage of aged records Pass through
-Off-line Shareholder research $25/hour (Billed to customer account)
-Check copies $3/each (Billed to customer account)
-Statement copies $5/each (Billed to customer account)
-Mutual Fund fulfillment/prospect file maintenance $1.00/item
-Shareholder communications charges (Faxes) Pass through
-Leased line/equipment on TA's computer system Pass through
-Dial-up access to TA's computer system Pass through
-Labels $.05 ea/$100 minimum
-Electronic filings of approved forms $75/transmission
-AD-HOC REPORTWRITER Report Generation $50.00 per report
-Bank Reconciliation Service $50.00
monthly maintenance fee per bank account $1.50 per bank item
-Systems Programming Labor Charges:
Programmers or Consultants $125.00/hour
Officers $150.00/hour
-Additional Proxy Processing:
Each processing $225.00 fixed charge per processing
Preparation and Tabulation $0.145/proxy issued
(includes 3 tabulations, sixteen propositions)
Each Extra Tabulation $23.00 fixed charge per processing
$0.02 per proxy tabulated
FUND ACCOUNTING FEE SCHEDULE
STANDARD FEE
------------
0.05% for the first $50 million in average net assets per portfolio per year;
0.04% from $50 million to $100 million in average net assets per portfolio per
year;
0.03% over $100 million in average net assets per portfolio per year.
Out of Pocket Fees: Fees charged for outside pricing services and all
accompanying administrative expenditures.
Subject to a $18,0001 annual minimum per portfolio (one share class) plus
$7,5001 per additional share class.
Fees are billed on a monthly basis.
1 Discount based on total fund assets:
$0 - 2 Million 30%
$2 - 5 Million 20%
$5 Million Plus 0%
OPTIONAL SERVICES AVAILABLE - INITIAL (FOR DESIRED SERVICES)
------------------------------------------------------------
__________ -Additional portfolio sub-adviser fee $10,000/portfolio
__________ -Multiple custodian fee $5,000/fund group
__________ -GNMA securities fee $2,500/portfolio
__________ -Quarterly financial statement preparation fee $5,000/portfolio
__________ -Statistical reporting fee (ICI, Lipper,
Donoghue, etc.) $100/report
__________ -S.E.C. audit requirements pass through
__________ -Processing of backup withholding $1,500/portfolio
SPECIAL REPORT GENERATION FEES
------------------------------
AD-HOC Report Generation $75.00 per report
Reruns $75.00 per run
Extract Tapes $110.00 plus
SYSTEMS PROGRAMMING LABOR CHARGES
---------------------------------
System Support Representatives $100.00/hour
Programmers, Consultants or
Department Heads $125.00/hour
Officers $150.00/hour
REPRICING CHARGES
-----------------
For incorrect or untimely information provided by an Advisor or its Agent,
Unified will charge $200.00 per day for each day that a portfolio is
repriced.
DE-CONVERSION FEES
------------------
De-Conversion fees will be subject to additional charges commensurate with
particular circumstances and dependent upon scope of problems.
FUND ADMINISTRATION SERVICES FEE SCHEDULE
STANDARD FEE
------------
0.10% for the first $50 million in average net assets per portfolio per year;
0.07% from $50 million to $100 million in average net assets per portfolio per
year;
0.05% over 100 million in average net assets per portfolio per year;
Subject to a $25,0001 annual minimum per portfolio (one share class) plus
$7,2001 per additional share class. Fees are billed on a monthly basis.
1 Discount based on total fund assets:
$0 - 2 Million 30%
$2 - 5 Million 20%
$5 Million Plus 0%
ADDITIONAL SERVICES AND FEES
----------------------------
1. Assistance in preparation and filing for an
exemptive order or no action letter from the
Securities and Exchange Commission $1,500 minimum
2. Assist in the preparation and filing of
additional Fund's Registration Statement on
Form N1-A or any replacement thereof $500 minimum
3. Assistance in preparation, filing and vote
compilation of Proxy Statement for Special
Shareholders Meeting. $5,000 minimum
per Special Meeting
4. Assistance in Dissolution and Deregistration
of the Fund (including related Proxy Statement) $15,000 minimum
5. Reorganization/Merger of the Fund or
portfolios (including proxy statement and
excluding tax opinion) $15,000 minimum
6. Blue-Sky Filing Fees $25 per permit
7. Such other duties related to the
administration of the Fund as agreed to by
Unified Negotiable
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