EXHIBIT (g)(3)
FORM OF ACCOUNTING AGENCY AGREEMENT
THIS ACCOUNTING AGENCY AGREEMENT is made as of ________, 200__ by and
between XXXXX BROTHERS XXXXXXXX & CO., (the "Accounting Agent"), and [INSERT
REGISTRANT] (the "Fund"), on behalf of each series of the Fund listed on
Appendix A attached hereto, as it may be amended from time to time (each, a
"Portfolio").
WHEREAS, the Fund is registered as management investment company under the
Investment Company Act of 1940, as amended (the "1940 Act"); and
WHEREAS, the Fund desires to retain the Accounting Agent to perform
certain accounting and recordkeeping services on behalf of each Portfolio, and
the Accounting Agent is willing to render such services.
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, the parties hereto agree as follows:
1. Employment of Accounting Agent. The Fund hereby employs and appoints
the Accounting Agent to act as the fund accounting agent to each Portfolio on
the terms set forth in this Agreement, and the Accounting Agent accepts such
appointment.
2. Delivery of Documents. The Fund will (i) furnish the Accounting Agent
with properly certified or authenticated copies of resolutions of the Fund's
Board of Directors or Trustees authorizing the appointment of the Accounting
Agent to provide certain fund accounting services to each Portfolio and
approving this Agreement on behalf of each Portfolio; (ii) provide the
Accounting Agent with any other documents or resolutions (including but not
limited to directions or resolutions of the Fund's Board of Directors or
Trustees) which relate to or affect the Accounting Agent's performance of its
duties hereunder or which the Accounting Agent may reasonably request; and (iii)
notify the Accounting Agent promptly of any matter affecting the performance by
the Accounting Agent of its services under this Agreement.
3. Recordkeeping and Calculation of Net Asset Value. The Accounting Agent
shall compute and determine the net asset value per share of each Portfolio,
including each class of shares of any Portfolio that issues its shares in more
than one class (each a "Class"), as of the times listed in the
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Portfolio's most recent prospectus and Statement of Additional Information
("SAI"), unless otherwise directed by Proper Instructions (as defined in Section
7(a) of this Agreement). Such computation and determination shall be made in
accordance with (1) the provisions of the Fund's Declaration of Trust or
Articles of Incorporation and By-Laws, as they may from time to time be amended
and delivered to the Accounting Agent, (2) the votes of the Board of Trustees or
Directors of the Fund at the time in force and applicable, and (3) the
accounting policies and procedures set forth in the Portfolio's prospectus and
SAI, and (4) Proper Instructions, as they may from time to time be delivered to
the Accounting Agent. On each day that the Accounting Agent shall compute the
net asset value per share of each Portfolio and each Class, the Accounting Agent
shall provide each Portfolio's investment adviser (or to the Portfolio's
sub-adviser(s), upon receipt by the Accounting Agent of Proper Instructions with
written reports which the investment adviser or sub-adviser will use to verify
that portfolio transactions have been recorded in accordance with the Fund's
instructions and are reconciled with the Fund's trading records.
In computing the net asset value, the Accounting Agent may rely upon any
information furnished by Proper Instructions, including without limitation any
information (1) as to accrual of liabilities of the Fund and as to liabilities
of the Fund not appearing on the books of account kept by the Accounting Agent,
(2) as to the existence, status and proper treatment of reserves, if any,
authorized by the Fund, (3) as to the sources of quotations to be used in
computing the net asset value, including those listed in Appendix B, (4) as to
the fair value to be assigned to any securities or other property for which
price quotations are not readily available, and (5) as to the sources of
information with respect to "corporate actions" affecting portfolio securities
of the Fund, including those listed in Appendix B. (Information as to "corporate
actions" shall include information as to dividends, distributions, stock splits,
stock dividends, rights offerings, conversions, exchanges, recapitalizations,
mergers, redemptions, calls, maturity dates and similar transactions, including
the ex- and record dates and the amounts or other terms thereof). The Fund may
instruct via Proper Instructions the Accounting Agent to utilize a particular
source for the valuation of a specific Security or other Property and the
Accounting Agent shall be protected in utilizing the valuation provided by such
source without further inquiry in order to effect calculation of each
Portfolio's and each Class' net asset value. Notwithstanding anything in this
Agreement to the contrary, the Accounting Agent shall not be responsible for the
failure of the Fund or its investment adviser to provide the Accounting Agent
with Proper Instructions regarding liabilities which ought to be included in the
calculation of any Portfolio's or any Class' net asset value.
In like manner, the Accounting Agent shall compute and determine the net
asset value of any Portfolio or any Classes of such other times as the Board of
Trustees or Directors of the Fund from time to time may reasonably request.
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4. Expenses and Compensation. For the services to be rendered and the
facilities to be furnished by the Accounting Agent as provided for in this
Agreement, the Fund shall pay the Accounting Agent for its services rendered
pursuant to this Agreement a fee based on such fee schedule as may from time to
time be agreed upon in writing by the Fund and the Accounting Agent. In addition
to such fee, the Accounting Agent shall xxxx the Fund separately for any
reasonable and documented out-of-pocket disbursements of the Accounting Agent.
Out-of-pocket disbursements shall include, but shall not be limited to, postage,
including courier services; telephone; telecommunications; printing, duplicating
and photocopying charges; forms and supplies; filing fees; legal expenses not
incurred in the ordinary course of business; and travel expenses. The foregoing
fees and disbursements shall be billed to the Fund by the Accounting Agent and
shall be paid promptly by wire transfer or other appropriate means to the
Accounting Agent.
5. Standard of Care. The Accounting Agent shall be held only to the
exercise of such reasonable care as employed by a professional accounting agent
in computing and determining the net asset value of each Portfolio and each
Class as provided in this Agreement, but shall not be held accountable or liable
for any losses or damages the Fund or any shareholder or former shareholder of
the Fund or any other person may suffer or incur arising from or based upon
errors or delays in the determination of such net asset value resulting from any
event beyond the reasonable control of the Accounting Agent unless such error or
delay was due to the Accounting Agent's negligence or reckless or willful
misconduct in determination of such net asset value. (The parties hereto
acknowledge, however, that the Accounting Agent's causing an error or delay in
the determination of net asset value may, but does not in and of itself,
constitute negligence or reckless or willful misconduct.) In no event shall the
Accounting Agent be liable or responsible to the Fund, any present or former
shareholder of the Fund or any other person for any error or delay to the extent
that such error or delay continued or was undetected after the date of an audit
performed by the certified public accountants employed by the Fund if, in the
exercise of reasonable care in accordance with generally accepted accounting
standards, such accountants should have become aware of such error or delay in
the course of performing such audit. The Accounting Agent's liability for any
such negligence or reckless or willful misconduct which results in an error in
determination of such net asset value shall be limited exclusively to the
direct, out-of-pocket loss the Fund, shareholder or former shareholder shall
actually incur, measured by the difference between the actual and the
erroneously computed net asset value, and any expenses the Fund shall incur in
connection with correcting the records of the Fund affected by such error
(including charges made by the Fund's registrar and transfer agent for making
such corrections) or communicating with shareholders or former
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shareholders of the Fund affected by such error.
Without limiting the foregoing, the Accounting Agent shall not be held
accountable or liable to the Fund, any shareholder or former shareholder thereof
or any other person for any delays or losses, damages or expenses any of them
may suffer or incur resulting from (1) the Accounting Agent's failure to receive
timely and suitable notification concerning quotations or corporate actions
relating to or affecting portfolio securities of the Fund, unless such
notification had been properly transmitted to the Accounting Agent; (2) any
errors in the computation of the net asset value based upon or arising out of
quotations or information as to corporate actions if received by the Accounting
Agent either (i) from a source which the Accounting Agent was authorized
pursuant to the third paragraph of this Section to rely upon, or (ii) from a
source which in the Administrator's reasonable judgment was as reliable a source
for such quotations or information as the sources authorized pursuant to that
third paragraph; or (3) relevant information known to the Fund or the investment
adviser which would impact the calculation of net asset value but which is not
communicated by the Fund or the investment adviser to the Accounting Agent.
In the event of any error or delay in the determination of such net asset
value for which the Accounting Agent may be liable, the Fund (or its delegate)
and the Accounting Agent may consult and make good faith efforts to reach
agreement on what actions should be taken in order to mitigate any loss suffered
by the Fund or its present or former shareholders, in order that the Accounting
Agent's exposure to liability shall be reduced to the extent possible after
taking into account all relevant factors and alternatives. Such actions might
include the Fund or the Accounting Agent taking reasonable steps to collect from
any shareholder or former shareholder who has received any overpayment upon
redemption of shares such overpaid amount or to collect from any shareholder who
has underpaid upon a purchase of shares the amount of such underpayment or to
reduce the number of shares issued to such shareholder. It is understood that in
attempting to reach agreement on the actions to be taken or the amount of the
loss which should appropriately be borne by the Accounting Agent, the Fund and
the Accounting Agent will consider such relevant factors as the amount of the
loss involved, the Fund's desire to avoid loss of shareholder good will, the
fact that other persons or entities could have been reasonably expected to have
detected the error sooner than the time it was actually discovered, the
appropriateness of limiting or eliminating the benefit which shareholders or
former shareholders might have obtained by reason of the error, and the
possibility that other parties providing services to the Fund might be induced
to absorb a portion of the loss incurred.
6. Limitation of Liability.
(a) The Accounting Agent shall incur no liability with respect to
any
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telecommunications, equipment or power failures, or any failures to perform or
delays in performance by postal or courier services or third-party information
providers, to the extent that such failures or delays are not attributable to
any negligence, recklessness or willful misconduct by the Accounting Agent. The
Accounting Agent shall also incur no liability under this Agreement if the
Accounting Agent or any agent or entity utilized by the Accounting Agent shall
be prevented, forbidden or delayed from performing, or omits to perform, any act
or thing which this Agreement provides shall be performed or omitted to be
performed, by reason of causes or events beyond its control, including but not
limited to (x) any Sovereign Risk, or (y) any provision of any present or future
law, regulation or order of the United States or any state thereof, or of any
foreign country or political subdivision thereof, or of any securities
depository or clearing agency, or (z) any provision of any order or judgment of
any court of competent jurisdiction. A "Sovereign Risk" shall mean any
nationalization; expropriation; devaluation; revaluation; confiscation; seizure;
cancellation; destruction; strike; act of war, terrorism, insurrection or
revolution; or any other act or event beyond the Accounting Agent's control.
(b) Notwithstanding any other provision of this Agreement, the
Accounting Agent shall not be held accountable or liable for any losses, damages
or expenses the Fund or any shareholder or former shareholder of the Fund or any
other person may suffer or incur arising from acts, omissions, errors or delays
of the Accounting Agent in the performance of its obligations and duties
hereunder, including without limitation any error of judgment or mistake of law,
except a damage, loss or expense resulting from the Accounting Agent's willful
malfeasance, bad faith or negligence in the performance of such obligations and
duties. The Accounting Agent shall in no event be required to take any action
which is in contravention of any applicable law, rule or regulation or any order
or judgment of any court of competent jurisdiction. The Fund hereby agrees to
indemnify the Accounting Agent against and hold it harmless from any and all
losses, claims, damages, liabilities or expenses (including reasonable counsel
fees and expenses) resulting from any act, omission, error or delay or any
claim, demand, action or suit, in connection with or arising out of performance
of its obligations and duties under this Agreement that did not result from the
willful malfeasance, bad faith or negligence of the Accounting Agent in the
performance of such obligations and duties.
(c) Notwithstanding anything else in this Agreement to the contrary,
the Accounting Agent's entire liability to the Fund for any loss or damage
arising or resulting from its performance hereunder or for any other cause
whatsoever, and regardless of the form of action, shall be limited to the Fund's
actual and direct out-of-pocket expenses and losses which are reasonably
incurred by the Fund. For avoidance of doubt and provided that (i) expenses and
losses are the direct result of the Accounting Agent's negligence or willful
misconduct, and (ii) there are no other reasonable means by which to correct
such books and records or to resolve such errors, such actual and direct
out-of-pocket expenses
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and losses shall include any expenses incurred by the Fund for the sole purpose
of correcting its books and records maintained by its transfer agent. In no
event and under no circumstances shall the Accounting Agent or a Fund be held
liable for consequential or indirect damages, loss of profits, damage to
reputation or business or any other special damages arising under or by reason
of any provision of this Agreement or for any act or omission hereunder.
7. Reliance by the Accounting Agent on Proper Instructions and Opinions of
Counsel and Opinions of Certified Public Accountants.
(a) The Accounting Agent shall not be liable for, and shall be
indemnified by the Fund against any and all losses, costs, damages or expenses
arising from or as a result of, any action taken or omitted in reliance upon
Proper Instructions or upon any other written notice, request, direction,
instruction, certificate or other instrument reasonably believed by it to be
genuine and signed or authorized by the proper party or parties.
Proper Instructions shall include a written request, direction,
instruction or certification signed or initialed on behalf of the Fund by one or
more persons as the Board of Trustees or Directors of the Fund shall have from
time to time authorized. Those persons authorized to give Proper Instructions
may be identified by the Board of Trustees or Directors by name, title or
position and will include at least one officer empowered by the Board to name
other individuals who are authorized to give Proper Instructions on behalf of
the Fund. A list of such persons is attached to the Agreement as Appendix C.
Telephonic or other oral instructions or instructions given by telefax
transmission, or instructions transmitted by electronic means may be given by
any one of the above persons and will also be considered Proper Instructions if
the Accounting Agent, in the exercise of such reasonable care as employed by a
professional accounting agent in like circumstances, believes them to have been
given by a person authorized to give such instructions with respect to the
transaction involved.
With respect to telefax transmissions, the Fund hereby acknowledges that
(i) receipt of legible instructions cannot be assured, (ii) the Accounting Agent
cannot verify that authorized signatures on telefax instructions are original,
and (iii) the Accounting Agent shall not be responsible for losses or expenses
incurred through actions taken in reasonable reliance on such telefax
instructions.
Proper Instructions given orally will be confirmed by written instructions
in the manner set forth above, including by telefax, but the lack of such
confirmation shall in no way affect any action taken by the Accounting Agent in
reliance upon such oral instructions. The Fund authorizes the Accounting Agent
to tape record any and all telephonic or other oral instructions given to the
Accounting Agent by or on behalf of the Fund (including any of its officers,
Directors, Trustees, employees or agents or any
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investment manager or adviser or person or entity with similar responsibilities
which is authorized to give Proper Instructions on behalf of the Fund to the
Accounting Agent) and to save a permanent storage medium any and all Proper
Instructions transmitted electronically.
(b) The Accounting Agent may consult with its counsel or the Fund's
counsel in any case where so doing appears to the Accounting Agent to be
necessary or desirable. The Accounting Agent shall not be considered to have
engaged in any misconduct or to have acted negligently and shall be without
liability in acting in accordance with the advice of its counsel or of the
Fund's counsel.
(c) The Accounting Agent may consult with a certified public
accountant or the Fund's Treasurer in any case where so doing appears to the
Accounting Agent to be necessary or desirable. The Accounting Agent shall not be
considered to have engaged in any misconduct or to have acted negligently and
shall be without liability in acting in accordance with the advice of such
certified public accountant or of the Fund's Treasurer.
8. Termination of Agreement.
(a) This Agreement shall continue in full force and effect with
respect to each Portfolio until terminated by the Accounting Agent or the Fund
with respect to any Portfolio by an instrument in writing delivered or mailed,
postage prepaid, to the other party, such termination to take effect not sooner
than ninety (90) calendar days after the date of such delivery or mailing. In
the event a termination notice is given by the Fund, all expenses associated
with the movement of records and materials and the conversion thereof shall be
paid by the Fund for which services shall cease to be performed hereunder. The
Accounting Agent shall be responsible for completing all actions in progress
when such termination notice is given unless otherwise agreed. Notwithstanding
the termination of this Agreement with respect to any Portfolio, this Agreement
shall remain in full force and effect with respect to all Portfolios not so
terminated.
Notwithstanding anything in the foregoing provisions of this clause, if it
appears impracticable in the circumstances to effect an orderly delivery of the
necessary and appropriate records of the Accounting Agent to a successor within
the time specified in the notice of termination as aforesaid, the Accounting
Agent and the Fund agree that this Agreement shall remain in full force and
effect for such reasonable period as may be required to complete necessary
arrangements with a successor.
(b) If a party hereto shall fail to perform its duties and
obligations hereunder (a "Defaulting Party") resulting in material loss to
another party ("the "Non-Defaulting Party"), the Non-Defaulting Party may give
written notice thereof to the Defaulting Party, and if such material breach
shall not have been remedied within thirty (30) calendar days after such written
notice is given, then the Non-Defaulting Party may terminate this Agreement by
giving thirty (30) calendar days' written notice of such
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termination to the Defaulting Party. If the Accounting Agent is the
Non-Defaulting Party, its termination of this Agreement shall not constitute a
waiver of any other rights or remedies of the Accounting Agent with respect to
payment for services performed prior to such termination or rights of the
Accounting Agent to be reimbursed for out-of-pocket expenses. In all cases,
termination by the Non-Defaulting Party shall not constitute a waiver by the
Non-Defaulting Party of any other rights it might have under this Agreement or
otherwise against the Defaulting Party.
(c) This Section 8 shall survive any termination of this Agreement,
whether for cause or not for cause.
9. Amendment of this Agreement. This Agreement constitutes the entire
understanding and agreement of the parties hereto with respect to the subject
matter hereof. No provision of this Agreement may be amended or terminated
except by a statement in writing signed by the party against which enforcement
of the amendment or termination is sought.
In connection with the operation of this Agreement, the Fund and the
Accounting Agent may agree in writing from time to time on such provisions
interpretive of or in addition to the provisions of this Agreement as may in
their joint opinion be consistent with the general tenor of this Agreement. No
interpretive or additional provisions made as provided in the preceding sentence
shall be deemed to be an amendment of this Agreement.
In the event any provision of this Agreement is determined to be void or
unenforceable, such determination shall not affect the remainder of this
Agreement, which shall continue to be in force.
The section headings and the use of defined terms in the singular or
plural tenses in this Agreement are for the convenience of the parties and in no
way alter, amend, limit or restrict the contractual obligations of the parties
set forth in this Agreement.
10. GOVERNING LAW AND JURISDICTION. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH, AND BE GOVERNED BY THE LAWS OF, THE STATE OF NEW YORK, WITHOUT
GIVING EFFECT TO THE CONFLICTS OF LAW OF SUCH STATE. THE PARTIES HERETO
IRREVOCABLY CONSENT TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF
NEW YORK AND THE FEDERAL COURTS LOCATED IN NEW YORK CITY IN THE BOROUGH OF
MANHATTAN.
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11. Notices. Notices and other writings delivered or mailed postage
prepaid to a Fund addressed to the Fund at 0000 Xxxx Xxxxxxxxxx Xxxxx Xxxx,
Xxxxxxxxxx, XX 0000-0000 or to such other address as the Fund may have
designated to the Accounting Agent in writing, or to the Accounting Agent at 00
Xxxxx Xxxxxx, Xxxxxx, XX 00000, Attention: Manager, Fund Accounting Department,
or to such other address as the Accounting Agent may have designated to the Fund
in writing, shall be deemed to have been properly delivered or given hereunder
to the respective addressee.
12. Binding Effect. This Agreement shall be binding upon and inure to the
benefit of the Fund and the Accounting Agent and their respective successors and
assigns, provided that no party hereto may assign this Agreement or any of its
rights or obligations hereunder without the written consent of the other party.
13. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, and which
collectively shall be deemed to constitute only one instrument. This Agreement
shall become effective when one or more counterparts have been signed and
delivered by each of the parties.
14. Exclusivity. The services furnished by the Accounting Agent hereunder
are not to be deemed exclusive, and the Accounting Agent shall be free to
furnish similar services to others.
15. Authorization. Each party hereby represents and warrants that the
execution and delivery of this Agreement have been duly authorized by that
party's governing body and that this Agreement has been signed by an authorized
officer of that party.
16. No Personal Liability of Trustees, Shareholders or Officers. It is
expressly agreed that the obligations of the parties hereunder shall not be
binding upon any of the Trustees, shareholders, nominees, officers, agent or
employees of the Pilgrim Advisory Funds, Inc. personally, but shall bind only
the trust property of the Pilgrim Advisory Funds, Inc., as provided in the
Declaration of Trust of Pilgrim Advisory Funds, Inc. The execution and delivery
of the Agreement by the Pilgrim Advisory Funds, Inc.'s officers shall not be
deemed to have been made by any of them individually or to impose any liability
on any of them personally, but shall bind only the trust property of the Pilgrim
Advisory Funds, Inc.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their duly authorized officers as of the date
first written above.
XXXXX BROTHERS XXXXXXXX & CO. [INSERT REGISTRANT] for itself and on
behalf of the Portfolios listed on
Appendix A hereto
By: By:
----------------------------- ----------------------------------
Name: Name:
------------------- ---------------------
Title: Title:
------------------ --------------------
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APPENDIX A
NAME OF PORTFOLIOS AND CLASSES
[INSERT SERIES]
00
XXXXXXXX X
[INSERT REGISTRANT
THE FOLLOWING AUTHORIZED SOURCES ARE TO BE USED FOR PRICING AND FOREIGN EXCHANGE
QUOTATIONS, CORPORATE ACTIONS, DIVIDENDS AND RIGHTS OFFERINGS:
AUTHORIZED SOURCES
BLOOMBERG
FUND MANAGERS
FT INTERACTIVE DATA CORPORATION
REPUTABLE BROKERS
REUTERS
SUBCUSTODIAN BANKS
TELEKURS
REPUTABLE FINANCIAL PUBLICATIONS
STOCK EXCHANGES
FINANCIAL INFORMATION INC. CARD
XX XXXXX
FRI CORPORATION
XXXXXXX XXXXX PRICING SERVICE
BRIDGE
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APPENDIX C
LIST OF PERSON AUTHORIZED TO GIVE PROPER INSTRUCTIONS
Xxxxx X. Xxxxxxxx
Xxxxxxx X. Xxxxx
Xxxx Xxxxxxx
Xxxxxxx X. Xxxxxx
Xxxxxx X. Naka
Xxxxx X. Xxxxx
Xxxxxxx X. Xxxxxxxx
Xxxxx X. Xxxxxxx
Xxxxxxxx X. Xxxxxxxx
Xxxxx Xxxxxxxx
Xxxx Xxxxx
Xxxx Xxxxx
Xxxxx Xxxxxx
Xxxxxx Xxxxxxxx
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