THIS
FUND ACCOUNTING SERVICES AGREEMENT (this “Agreement”) is entered into this
___ day of _______, 2004, by and between Xxxxxxx Funds, Inc., a Maryland Corporation (the
“Corporation”), on behalf of Xxxxxxx Emerging Opportunities Fund (the
“Fund”), and _______, a _______ company (“Provider”).
RECITALS:
WHEREAS,
the Corporation is an open-end management investment company which is registered under the
Investment Company Act of 1940; and
WHEREAS,
Provider is in the business of providing, among other things, mutual fund accounting
services to investment companies.
AGREEMENT:
NOW,
THEREFORE, the parties do mutually promise and agree as follows:
| |
1. |
Services. Provider
agrees to provide the following mutual fund accounting services to the
Fund: |
| |
A. |
Portfolio
Accounting Services: |
| |
(1) |
Maintain
portfolio records on a trade date +1 basis using security trade
information communicated from the investment manager on a timely basis. |
| |
(2) |
For
each valuation date, obtain prices from a pricing source approved by the
Board of Directors and apply those prices to the portfolio positions. For
those securities where market quotations are not readily available, the
Board of Directors shall approve, in good faith, the method for
determining the fair value for such securities. |
| |
(3) |
Identify
interest and dividend accrual balances as of each valuation date and
calculate gross earnings on investments for the accounting period. |
| |
(4) |
Determine
gain/loss on security sales and identify them as to short- or long-term
status; account for periodic distributions of gains or losses to
shareholders and maintain undistributed gain or loss balances as of each
valuation date. |
| |
B. |
Expense
Accrual and Payment Services: |
| |
(1) |
For
each valuation date, calculate the expense accrual amounts as directed by
the Fund as to methodology, rate or dollar amount. |
| |
(2) |
Record
payments for Fund expenses upon receipt of written authorization from the
Fund. |
| |
(3) |
Account
for fund expenditures and maintain expense accrual balances at the level
of accounting detail, as agreed upon by Provider and the Fund. |
| |
(4) |
Provide
expense accrual and payment reporting. |
| |
C. |
Fund
Valuation and Financial Reporting Services: |
| |
(1) |
Account
for fund share purchases, sales, exchanges, transfers, dividend
reinvestments, and other fund share activity as reported by the transfer
agent on a timely basis. |
| |
(2) |
Apply
equalization accounting as directed by the Fund. |
| |
(3) |
Determine
net investment income (earnings) for the Fund as of each valuation date.
Account for periodic distributions of earnings to shareholders and
maintain undistributed net investment income balances as of each valuation
date. |
| |
(4) |
Maintain
a general ledger for the Fund in the form as agreed upon. |
| |
(5) |
For
each day the Fund is open as defined in the prospectus determine the net
asset value according to the accounting policies and procedures set forth
in the prospectus. |
| |
(6) |
Calculate
per share net asset value, per share net earnings, and other per share
amounts reflective of fund operation at such time as required by the
nature and characteristics of the Fund. |
| |
(7) |
Communicate,
at an agreed upon time, the per share price for each valuation date to
parties as agreed upon from time to time. |
| |
(8) |
Prepare
monthly reports which document the adequacy of accounting detail to
support month-end ledger balances. |
| |
D. |
Tax
Accounting Services: |
| |
(1) |
Maintain
tax accounting records for the investment portfolio of the Fund to support
the tax reporting required for IRS-defined regulated investment companies. |
2
| |
(2) |
Maintain
tax lot detail for the investment portfolio. |
| |
(3) |
Calculate
taxable gain/loss on security sales using the tax cost basis designated by
the Fund. |
| |
(4) |
Provide
the necessary financial information to support the taxable components of
income and capital gains distributions to the transfer agent to support
tax reporting to the shareholders. |
| |
E. |
Compliance
Control Services: |
| |
(1) |
Support
reporting to regulatory bodies and support financial statement preparation
by making the fund accounting records available to the Fund, Xxxxxxx
Capital Management, Inc., the Securities and Exchange Commission, and the
outside auditors. |
| |
(2) |
Maintain
accounting records according to the Investment Company Act of 1940 and
regulations provided thereunder. |
2. Changes
in Accounting Procedures. Any resolution passed by the Board of Directors
that affects accounting practices and procedures under this agreement shall be
effective upon written receipt and acceptance by Provider.
3. Changes
in Equipment, Systems, Service, Etc. Provider reserves the right to make
changes from time to time, as it deems advisable, relating to its services,
systems, programs, rules, operating schedules and equipment, so long as such
changes do not adversely affect the service provided to the Fund under this
Agreement.
4. Compensation. Provider
shall be compensated for providing the services set forth in this Agreement in
accordance with the Fee Schedule attached hereto as Exhibit A and
as mutually agreed upon and amended from time to time.
5. Performance
of Service. Provider shall exercise reasonable care in the performance of
its duties under the Agreement. The Fund agrees to reimburse and make Provider
whole for any loss or damages (including reasonable fees and expenses of legal
counsel) arising out of or in connection with its actions under this Agreement
so long as Provider acts in good faith and is not negligent or guilty of any
willful misconduct.
Provider
shall not be liable or responsible for delays or errors occurring by reason of
circumstances beyond its control, including acts of civil or military authority, natural
or state emergencies, fire, mechanical breakdown, flood or catastrophe, acts of God,
insurrection, war, riots or failure of transportation, communication or power supply.
In
the event of a mechanical breakdown beyond its control, Provider shall take all reasonable
steps to minimize service interruptions for any period that such interruption continues
beyond Provider’s control. Provider will make every reasonable effort to restore any
lost or damaged data and the correcting of any errors resulting from such a breakdown will
be at the expense of Provider. Provider agrees that it shall at all times have reasonable
contingency plans with appropriate parties, making reasonable provision for emergency use
of electrical data processing equipment to the extent appropriate equipment is available.
Representatives of the Fund shall be entitled to inspect Provider’s premises and
operating capabilities at any time during regular business hours of Provider, upon
reasonable notice to Provider.
3
This
indemnification includes any act, omission to act, or delay by Provider in reliance upon,
or in accordance with, any written or oral instruction it receives from any duly
authorized officer of the Fund.
Regardless
of the above, Provider reserves the right to reprocess and correct administrative errors
at its own expense.
6. No
Agency Relationship. Nothing herein contained shall be deemed to authorize
or empower Provider to act as agent for any other party to this Agreement, or
to conduct business in the name of, or for the account of, any other party to
this Agreement.
7. Ownership
of Records. All records prepared or maintained by Provider on behalf of the
Fund remain the property of the Fund and will be surrendered promptly on the
written request of an authored officer of the Fund.
8. Confidentiality. Provider
shall handle in confidence all information relating to the Fund’s
business, which is received by Provider during the course of rendering any
service hereunder.
9. Data
Necessary to Perform Services. The Fund or its agent, which may be
Provider, shall furnish to Provider the data necessary to perform the services
described herein at times and in such form as mutually agreed upon.
10. Notification
of Error. The Fund will notify Provider of any balancing or control error
caused by Provider within three (3) business days after receipt of any reports
rendered by Provider to the Fund, or within three (3) business days after
discovery of any error or omission not covered in the balancing or control
procedure, or within three (3) business days of receiving notice from any
shareholder.
11. Term
of Agreement. This Agreement may be terminated by either party upon giving
ninety (90) days prior written notice to the other party or such shorter period
as is mutually agreed upon by the parties. However, this Agreement may be
replaced or modified by a subsequent agreement between the parties.
12. Duties
in the Event of Termination. In the event that in connection with
termination a successor to any of Provider’s duties or responsibilities
hereunder is designated by the Fund by written notice to Provider, Provider
will promptly, upon such termination and at the expense of the Fund, transfer
to such successor all relevant books, records, correspondence and other data
established or maintained by Provider under this Agreement in a form reasonably
acceptable to the Fund (if such form differs from the form in which Provider
has maintained the same, the Fund shall pay any expenses associated with
transferring the same to such form), and will cooperate in the transfer of such
duties and responsibilities, including provision for assistance from Provider’s
personnel in the establishment of books, records and other data by such
successor.
4
13. Choice
of Law. This Agreement shall be construed in accordance with the laws of
the State of Wisconsin.
IN
WITNESS WHEREOF, the due execution hereof on the date first above written.
|
PROVIDER |
|
By:____________________________________________ |
|
Its:____________________________________________ |
|
XXXXXXX FUNDS, INC. |
|
By:____________________________________________ |
|
Its:____________________________________________ |
5
Exhibit A
[To be agreed upon.]
6
