FUND ACCOUNTING SERVICE AGREEMENT
This agreement (the "Agreement") is entered into as of the _____ day of
_______, 1996 by and between The World Funds, Inc., (the "Fund"), an open-end
diversified investment business corporation organized under the laws of Maryland
and having its office at 0000 Xxxxxx Xxxxx Xxxxx 000, Xxxxxxxx, Xxxxxxxx, 00000,
for the benefit of the Vontobel U.S. Value Fund series (the "Series") and Star
Bank, National Association, (the "Star Bank"), a national banking association
having its principal office at 000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxx, 00000.
WHEREAS, the Fund desires to appoint Star Bank as an Accounting Services
Agent to maintain and keep current the books, accounts, records, journals or
other records of original entry relating to the business of the Series as set
forth in this Agreement; and
WHEREAS, the Fund will cause to be provided certain information to Star
Bank as set forth below:
NOW, THEREFORE, in consideration of the premises and mutual convenants
hereafter contained, the parties hereto agree as follows:
Section 1. DEFINITIONS
For purposes of this Agreement, the terms Oral Instructions and Written
Instructions shall mean:
(a) Oral Instructions: The term Oral Instructions shall mean an authorization,
instruction, approval, item or set of data, or information of any kind
transmitted to Star Bank in person or by telephone, telegram, telecopy or
other mechanical or documentary means lacking an original signature, by a
person or persons believed in good faith by Star Bank to be a person or persons
authorized by a resolution of the Board of Directors of the Fund, to give Oral
Instructions on behalf of the Fund.
(b) Written Instructions: The term Written Instructions shall mean an
authorization, instruction, approval, item or set of data or information of any
kind transmitted to Star Bank bearing an original signature of an authorized
person, or a copy of such document transmitted by telecopy including
transmission of such signature believed in good faith by Star Bank to be the
signature of a person authorized by a resolution of the Board of Directors of
the Fund to give Written Instructions of behalf of the Fund.
(c) The Fund shall file with Star Bank a certified copy of each resolution of
its Board of Directors authorizing execution of Written Instructions or the
transmittal of Oral Instructions as provided above.
Section 2. SCOPE OF DUTIES OF STAR BANK
(a) Upon receipt of the necessary information from the Fund or its agents by
Written or Oral Instructions, Star Bank shall maintain and keep current the
following Accounts and Records relating to the business of the Series, in such
form as may be mutually agreed to between the Fund and Star Bank, and as may be
required by the Investment Company Act of 1940 (the "Act"):
(1) Cash Receipts Journal
(2) Cash Disbursements Journal
(3) Dividends Paid and Payable Schedule
(4) Purchase and Sales Journals - Portfolio Securities
(5) Subscription and Redemption Journals
(6) Security Ledgers - Transaction Report and Tax Lot Report
(7) Broker Ledger - Commission Report
(8) Daily Expense Accruals
(9) Daily Interest Accruals
(10) Daily Trial Balance
(11) Portfolio Interest Receivable and Income Journal
(12) Listing of Portfolio Holdings showing cost, market value and
percentage of portfolio comprised of each security.
(b) Star Bank 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.
Section 3. LIMITATION OF LIABILITY OF STAR BANK
(a) Unless necessary information to perform the above functions is furnished by
Written or Oral Instructions to Star Bank in a timely manner to enable the
daily calculation of the Fund's net asset value at the time set by the Fund
pursuant to Rule 22c-1 under the Act, Star Bank shall incur no liability,
and the Fund shall indemnify and hold harmless Star Bank from and against
any liability arising from any failure to provide complete information or
from any discrepancy between the information received by Star Bank and used
in such calculations and any subsequent information received from the Fund
or any of its designated Agents.
(b) Star Bank may rely upon the advice of the Fund, or of counsel for the Fund
and upon statements of the Fund's independent accountants, brokers and other
persons reasonably believed by it in good faith to be expert in the matters upon
which they are consulted and for any actions reasonably taken in good faith
reliance upon such statements and without negligence or willful misconduct, Star
Bank shall not be liable to anyone.
Section 4. REPORTS
(a) The Fund shall provide to Star Bank on a quarterly basis a report of a duly
authorized officer of the Fund representing that
all information furnished to Star Bank during the preceding quarter was true,
complete and correct in all material respects. Star Bank 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 Star Bank 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,
Star Bank determines, on the basis of information supplied to Star Bank 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, Star Bank shall
promptly notify the Fund and its counsel of such violation.
Section 5. PRICING
(a) Star Bank shall perform ministerial calculations necessary to calculate the
Fund's net asset value daily, in accordance with the Fund's current prospectus
and utilizing the information described in this Section.
(b) Portfolio investments for which market value is to be determined by the use
of an automated financial service (a "Pricing Service") approved by the Fund
shall be valued based on the prices of the portfolio investment reported by such
Pricing Service except where the Fund has given or caused to be given specific
Written or Oral Instructions to utilize a different value. Notwithstanding any
information obtained from a Pricing Service, all portfolio securities shall be
given such values as the Fund shall direct by Written or Oral Instructions,
including all restricted securities and other securities requiring valuation not
readily ascertainable solely by the use of such a Pricing Service.
(c) Star Bank shall have no responsibility or liability for the accuracy of
prices quoted by any recognized Pricing Service used by it pursuant to the
preceding paragraph; for the accuracy of the information supplied by the Fund;
or for any loss, liability, damage, or cost arising out of any inaccuracy of
such data, unless Star Bank is itself negligent with respect thereto.
Section 6. RELIANCE UPON INSTRUCTIONS
(a) For all purposes under this Agreement, Star Bank is authorized to act upon
receipt of the first of any Written or Oral Instructions it receives from the
Fund or authorized agents of the Fund. In cases where the first instruction is
an Oral Instruction that is not in the form of a document or written record, a
confirmatory Written Instruction or Oral Instruction in the form of a document
or written record shall be delivered, and in cases where Star Bank receives an
Instruction, whether Written or Oral, to enter a portfolio transaction on the
records, the Fund shall cause the broker-dealer to send a written confirmation
to Star Bank.
(b) Star Bank shall be entitled to rely on the first Instruction received by it,
and for any act or omission undertaken in
compliance therewith shall be free of liability and fully indemnified and held
harmless by the Fund. If additional Instructions are received by the bank prior
to Complying with the original Instruction, the sole obligation of Star Bank
with respect to any follow-up or confirmatory Written Instruction, Oral
Instruction in documentary or written form, or broker-dealer written
confirmation shall be to make reasonable efforts to detect any such discrepancy
between the original Instruction and such confirmation and to report such
discrepancy to the Fund. The Fund shall be responsible, at the Fund's expense,
for taking any action, including any reprocessing, necessary to correct any
discrepancy or error.
Section 7. OWNERSHIP OF AND ACCESS TO FUND RECORDS
(a) It is agreed that the Accounts and Records maintained by Star Bank for the
Fund are the property of the Fund, and shall be made available to the Fund
promptly upon request and shall be maintained for the periods prescribed in
Rule 31(a)-2 under the Act.
(b) Star Bank shall assist the Fund's independent auditors or, upon lawful
demand, any authorized regulatory body, in any authorized inspection or review
of the Fund's Accounts and Records.
Section 8. PROCEDURES AND COMPLIANCE
Star Bank and the Fund may from time to time adopt such procedures as they
agree upon in writing, and Star Bank may conclusively assume that any procedure
approved or directed by the Fund does not conflict with or violate any
requirements of its Prospectus, Articles of Incorporation, By-Laws, or any
rule or regulation of any regulatory body or governmental agency. The Fund
shall be responsible for notifying Star Bank of any changes in regulations or
rules which might necessitate changes in Star Bank's procedures, and for working
out such changes with Star Bank.
Section 9. COMPENSATION
In consideration of the services to be performed by Star Bank, the Fund
agrees to pay Star Bank the fees and reimbursement of out-of-pocket expenses as
set forth in the fee schedule attached hereto as Schedule A.
Section 10. HOLIDAYS
Nothing contained in this Agreement is intended to or shall require Star
Bank, in any capacity hereunder, to perform any functions or duties on any
holiday, day of special observance or any other day on which the Custodian or
the New York Stock Exchange is closed. Functions or duties normally scheduled to
be performed on such days shall be performed, and as of, the next succeeding
business day on which both the New York Stock Exchange and the Custodian are
open. Not withstanding the foregoing, Star Bank shall compute the net asset
value of the Fund on each day required pursuant to Rule 22c-1 promulgated under
the Act.
Section 11. AGENTS
Star Bank reserves the right to appoint, in its sole discretion, agents
who may serve as accounting service agents, or perform any part of the duties
and responsibilities of Star Bank under this Agreement.
Section 12. TERMINATION
Either Party hereto may give written notice to the other party (the
"Termination Notice") of the termination of this Agreement. Such Termination
Notice shall state a date upon which the termination is effective (the
"Termination Date"), which shall be not less than sixty (60) days after the date
of the giving of the notice unless otherwise agreed by the parties hereto in
writing.
Section 13. NOTICE
Any notice or other communication required by or permitted to be given in
connection with this Agreement shall be in writing, and shall be delivered in
person or sent by first class mail, postage prepaid to the respective parties as
follows:
If to the Fund:
The World Funds, Inc.
0000 Xxxxxx Xxxxx Xxxxx 000
Xxxxxxxx, XX 00000
If to Star Bank:
Star Bank, N.A.
000 Xxxxxx Xxxxxx XX 0000
Xxxxxxxxxx, XX 00000
Section 14. AMENDMENTS TO BE IN WRITING
This Agreement may be amended from time to time by a writing executed by
the Fund and Star Bank. The compensation stated in Schedule A attached hereto
may be adjusted from time to time by the execution of a new schedule signed by
both of the parties.
Section 15. CONTROLLING LAW
This Agreement shall be construed in accordance with the laws of the
State of Ohio.
Section 16. JURISDICTION
Any legal action, suit or proceeding to be instituted by either party
with respect to this Agreement shall be brought by such party exclusively in the
courts of the State of Ohio or in courts of the United States for the Southern
District of Ohio, and each party, by its execution of this Agreement,
irrevocably (i) submits to such jurisdiction and (ii) consents to the service of
any process or pleadings by first class U.S. mail, postage prepaid and return
receipt requested, or by any other means from time to time authorized by the
laws of such jurisdiction.
Section 17. COUNTERPARTS
This Agreement may be executed in any number of counterparts, each of
which shall be deemed to be an original, but such counterparts shall, together,
constitute only one instrument.
Section 18. HEADINGS
The headings of paragraphs in this Agreement are for convenience of
reference only and shall not affect the meaning or construction of any provision
of this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective Officers, thereunto duly authorized as of the day
and year first above written.
The World Funds, Inc.
ATTEST: By: /s/ XXXX XXXXX III
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____________________ Xxxx Xxxxx III
Title: Chairman
Star Bank, N.A.
ATTEST: By: /s/ XXXXXX X. XXXXXXX
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____________________ Xxxxxx X. Xxxxxxx
Title: Vice President
