FUND ACCOUNTING AGREEMENT
THIS
AGREEMENT is made as of this 18th day
of April, 2005, by and between THE DESTINATION FUNDS (the "Trust"), an Ohio
business trust having its principal place of business at Three Ygnacio Center,
0000 Xxxxx Xxxx Xxxxxx, Xxxxx 000, Xxxxxx Xxxxx, Xxxxxxxxxx 00000, and ULTIMUS
FUND SOLUTIONS, LLC ("Ultimus"), a limited liability company organized under the
laws of the State of Ohio and having its principal place of business at 000
Xxxxxxxx Xxxxx, Xxxxx 000, Xxxxxxxxxx, Xxxx 00000.
WHEREAS,
the Trust is an open-end management investment company registered under the
Investment Company Act of 1940, as amended (the “1940 Act”); and
WHEREAS,
the Trust desires that Ultimus perform certain fund accounting services for each
series of the Trust, listed on Schedule A attached hereto and made part of this
Agreement, as such Schedule A may be amended from time to time (individually
referred to herein as the "Portfolio" and collectively as the "Portfolios");
and
WHEREAS,
Ultimus is willing to perform such services on the terms and conditions set
forth in this Agreement;
NOW,
THEREFORE, in consideration of the mutual premises and covenants herein set
forth, the parties agree as follows:
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1.
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RETENTION
OF ULTIMUS.
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The Trust
hereby retains Ultimus to act as the fund accountant of the Trust and to furnish
the Trust with the services as set forth below. Ultimus hereby
accepts such employment to perform such duties.
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(a)
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MAINTENANCE
OF BOOKS AND RECORDS.
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Ultimus
shall maintain and keep current the accounts, books, records and other documents
relating to the Trust’s financial and portfolio transactions as may be required
by the rules and regulations of the Securities and Exchange Commission (the
“SEC”) adopted under Section 31(a) of the 1940 Act. Ultimus shall
cause the subject records of the Trust to be maintained and preserved pursuant
to the requirements of the 1940 Act.
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(b)
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PERFORMANCE
OF DAILY ACCOUNTING SERVICES.
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In
addition to the maintenance of the books and records specified above, Ultimus
shall perform the following accounting services daily for each
Portfolio:
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(i)
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Calculate
the net asset value per share utilizing prices obtained from the sources
described in subsection 1(b)(ii)
below;
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(ii)
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Obtain
security prices from independent pricing services, or if such quotes are
unavailable, then obtain such prices from each Portfolio's investment
adviser or its designee, as approved by the Trust's Board of
Trustees (hereafter referred to as
"Trustees");
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(iii)
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Verify
and reconcile with the Portfolios' custodian all daily trade
activity;
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(iv)
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Compute,
as appropriate, each Portfolio's net income and capital gains, dividend
payables, dividend factors, yields, and weighted average portfolio
maturity;
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(v)
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Review
daily the net asset value calculation and dividend factor (if any) for
each Portfolio prior to release to shareholders, check and confirm the net
asset values and dividend factors for reasonableness and deviations, and
distribute net asset values and yields to
NASDAQ;
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(vi)
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Determine
unrealized appreciation and depreciation on securities held by the
Portfolios;
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(vii)
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Amortize
premiums and accrete discounts on securities purchased at a price other
than face value, if requested by the
Trust;
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(viii)
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Update
fund accounting system to reflect rate changes, as received from a
Portfolio's investment adviser, on variable interest rate
instruments;
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(ix)
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Post
Portfolio transactions to appropriate
categories;
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(x)
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Accrue
expenses of each Portfolio;
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(xi)
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Determine
the outstanding receivables and payables for all (1) security trades, (2)
Portfolio share transactions and (3) income and expense
accounts;
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(xii)
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Provide
accounting reports in connection with the Trust's regular annual audit and
other audits and examinations by regulatory agencies;
and
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(xiii)
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Provide
such periodic reports as the parties shall agree
upon.
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(c)
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SPECIAL
REPORTS AND SERVICES.
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(i)
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Ultimus
may provide additional special reports upon the request of the Trust or a
Portfolio's investment adviser, which may result in an additional charge,
the amount of which shall be agreed upon between the
parties.
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(ii)
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Ultimus
may provide such other similar services with respect to a Portfolio as may
be reasonably requested by the Trust, which may result in an additional
charge, the amount of which shall be agreed upon between the
parties.
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(d)
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ADDITIONAL
ACCOUNTING SERVICES.
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Ultimus
shall also perform the following additional accounting services for each
Portfolio:
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(i)
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Provide
monthly (or as frequently as may reasonably be requested by the Trust or a
Portfolio’s investment adviser) a set of financial statements for each
Portfolio as described below, upon request of the
Trust:
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Statement
of Assets and Liabilities
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Statement
of Operations
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Statement
of Changes in Net Assets
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Security
Purchases and Sales Journals
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Portfolio
Holdings Reports
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(ii)
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Provide
accounting information for the
following:
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(A)
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federal
and state income tax returns and federal excise tax
returns;
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(B)
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the
Trust's semi-annual reports with the SEC on Form
N-SAR;
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(C)
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the
Trust's annual, semi-annual and quarterly (if any) shareholder
reports;
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(D)
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registration
statements on Form N-1A and other filings relating to the registration of
shares;
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(E)
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Ultimus'
monitoring of the Trust's status as a regulated investment company under
Subchapter M of the Internal Revenue Code, as
amended;
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(F)
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annual
audit by the Trust's auditors; and
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(G)
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examinations
performed by the SEC.
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2.
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SUBCONTRACTING.
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Ultimus
may, at its expense and, upon written notice to the Trust, subcontract with any
entity or person concerning the provision of the services contemplated
hereunder; provided, however, that Ultimus shall not be relieved of any of its
obligations under this Agreement by the appointment of such subcontractor and
provided further, that Ultimus shall be responsible, to the extent provided in
Section 7 hereof, for all acts of such subcontractor as if such acts were its
own.
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3.
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COMPENSATION.
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The Trust
shall pay for the services to be provided by Ultimus under this Agreement in
accordance with, and in the manner set forth in, Schedule B attached hereto, as
such Schedule may be amended from time to time.
If this
Agreement becomes effective subsequent to the first day of a month or terminates
before the last day of a month, Ultimus’ compensation for that part of the month
in which the Agreement is in effect shall be prorated in a manner consistent
with the calculation of the fees as set forth above. Payment of
Ultimus’ compensation for the preceding month shall be made
promptly.
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4.
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REIMBURSEMENT
OF EXPENSES.
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In
addition to paying Ultimus the fees described in Schedule B attached hereto, the
Trust agrees to reimburse Ultimus for its reasonable out-of-pocket expenses in
providing services hereunder, including without limitation the
following:
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(a)
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All
freight and other delivery and bonding charges incurred by Ultimus in
delivering materials to and from the
Trust;
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(b)
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All
direct telephone, telephone transmission and telecopy or other electronic
transmission expenses incurred by Ultimus in communication with the Trust,
the Trust's investment adviser or custodian, dealers or others as required
for Ultimus to perform the services to be provided
hereunder;
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(c)
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The
cost of obtaining security market
quotes;
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(d)
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All
expenses incurred in connection with any custom programming or systems
modifications required to provide any special reports or services
requested by the Trust;
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(e)
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Any
expenses Ultimus shall incur at the written direction of an officer of the
Trust thereunto duly authorized other than an employee or other affiliated
person of Ultimus who may otherwise be named as an authorized
representative of the Trust for certain purposes;
and
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(f)
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Any
additional expenses reasonably incurred by Ultimus in the performance of
its duties and obligations under this
Agreement.
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5.
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EFFECTIVE
DATE.
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This
Agreement shall become effective with respect to a Portfolio as of the date
first written above (or, if a particular Portfolio is not in existence on that
date, on the date such Portfolio commences operation) (the "Effective
Date").
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6.
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TERM
OF THIS AGREEMENT.
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The term
of this Agreement shall continue in effect, unless earlier terminated by either
party hereto as provided hereunder, for a period of two
years. Thereafter, unless otherwise terminated as provided herein,
this Agreement shall be renewed automatically for successive one-year
periods.
This
Agreement may be terminated without penalty: (i) by provision of sixty (60)
days’ written notice; (ii) by mutual agreement of the parties; or (iii) for
"cause" (as defined herein) upon the provision of thirty (30) days’ advance
written notice by the party alleging cause.
For
purposes of this Agreement, "cause" shall mean: (i) a material breach of this
Agreement that has not been remedied within thirty (30) days following written
notice of such breach from the non-breaching party, (ii) a series of negligent
acts or omissions or breaches of this Agreement which, in the aggregate,
constitute in the reasonable judgment of the Trust, a serious failure to perform
satisfactorily Ultimus' obligations hereunder; (iii) a final, unappealable
judicial, regulatory or administrative ruling or order in which the party to be
terminated has been found guilty of criminal or unethical behavior in the
conduct of its business; or (iv) financial difficulties on the part of the party
to be terminated which are evidenced by the authorization or commencement of, or
involvement by way of pleading, answer, consent or acquiescence in, a voluntary
or involuntary case under Title 11 of the United States Code, as from time to
time is in effect, or any applicable law, other than said Title 11, of any
jurisdiction relating to the liquidation or reorganization of debtors or the
modification or alteration of the rights of creditors.
Notwithstanding
the foregoing, after such termination for so long as Ultimus, with the written
consent of the Trust, in fact continues to perform any one or more of the
services contemplated by this Agreement or any schedule or exhibit hereto, the
provisions of this Agreement, including without limitation the provisions
dealing with indemnification, shall continue in full force and
effect. Compensation due Ultimus and unpaid by the Trust upon such
termination shall be immediately due and payable upon and notwithstanding such
termination. Ultimus shall be entitled to collect from the Trust, in
addition to the compensation described in Schedule B, the amount of all of
Ultimus' cash disbursements for services in connection with
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Ultimus'
activities in effecting such termination, including without limitation, the
delivery to the Trust and/or its designees of the Trust's property, records,
instruments and documents.
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7.
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STANDARD
OF CARE.
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The
duties of Ultimus shall be confined to those expressly set forth herein, and no
implied duties are assumed by or may be asserted against Ultimus hereunder.
Ultimus shall use its best efforts in the performance of its duties hereunder
and act in good faith in performing the services provided for under this
Agreement. Ultimus shall be liable for any damages arising directly or
indirectly out of Ultimus' failure to perform its duties under this Agreement to
the extent such damages arise directly or indirectly out of Ultimus' willful
misfeasance, bad faith, negligence in the performance of its duties, or reckless
disregard of it obligations and duties hereunder. (As used in this Article 7,
the term "Ultimus" shall include directors, officers, employees and other agents
of Ultimus as well as Ultimus itself.)
Without
limiting the generality of the foregoing or any other provision of this
Agreement, (i) Ultimus shall not be liable for losses beyond its reasonable
control, provided that Ultimus has acted in accordance with the standard of care
set forth above; and (ii) Ultimus shall not be liable for the validity or
invalidity or authority or lack thereof of any instruction, notice or other
instrument that Ultimus reasonably believes to be genuine and to have been
signed or presented by a duly authorized representative of the Trust (other than
an employee or other affiliated persons of Ultimus who may otherwise be named as
an authorized representative of the Trust for certain purposes).
Ultimus
may apply to the Trust at any time for instructions and may consult with counsel
for the Trust or its own counsel and with accountants and other experts with
respect to any matter arising in connection with Ultimus' duties hereunder, and
Ultimus shall not be liable or accountable for any action taken or omitted by it
in good faith in accordance with such instruction or with the reasonable opinion
of such counsel, accountants or other experts qualified to render such
opinion.
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8.
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INDEMNIFICATION.
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The Trust
agrees to indemnify and hold harmless Ultimus from and against any and all
actions, suits, claims, losses, damages, costs, charges, reasonable counsel fees
and disbursements, payments, expenses and liabilities (including reasonable
investigation expenses) (collectively, "Losses") arising directly or indirectly
out of any action or omission to act which Ultimus takes (i) at any request or
on the direction of or in reliance on the reasonable advice of the Trust, (ii)
upon any instruction, notice or other instrument that Ultimus reasonably
believes to be genuine and to have been signed or presented by a duly authorized
representative of the Trust (other than an employee or other affiliated person
of Ultimus who may otherwise be named as an authorized representative of the
Trust for certain purposes) or (iii) on its own initiative, in good faith and in
accordance with the standard of care set forth herein, in connection with the
performance of its duties or obligations hereunder; provided, however that the
Trust shall have no obligation to indemnify or reimburse Ultimus under this
Article 8 to the extent that Ultimus is entitled to reimbursement or
indemnification for such Losses under any liability insurance policy described
in this Agreement or otherwise.
Ultimus
shall not be indemnified against or held harmless from any Losses arising
directly or indirectly out of Ultimus' own willful misfeasance, bad faith,
negligence in the performance of its duties, or reckless disregard of its
obligations and duties hereunder. (As used
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in this
Article 8, the term "Ultimus" shall include directors, officers, employees and
other agents of Ultimus as well as Ultimus itself.)
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9.
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RECORD
RETENTION AND CONFIDENTIALITY.
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Ultimus
shall keep and maintain on behalf of the Trust all books and records which the
Trust and Ultimus is, or may be, required to keep and maintain pursuant to any
applicable statutes, rules and regulations, including without limitation Rules
31a-1 and 31a-2 under the 1940 Act, relating to the maintenance of books and
records in connection with the services to be provided hereunder. Ultimus
further agrees that all such books and records shall be the property of the
Trust and to make such books and records available for inspection by the Trust
or by the SEC at reasonable times and otherwise to keep confidential all books
and records and other information relative to the Trust and its shareholders;
except when requested to divulge such information by duly-constituted
authorities or court process. If Ultimus is requested or required to
disclose any confidential information supplied to it by the Trust, Ultimus shall
unless prohibited by law, promptly notify the Trust of such request(s) so that
the Trust may seek an appropriate protective order.
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10.
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FORCE
MAJEURE.
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Ultimus
assumes no responsibility hereunder, and shall not be liable, for any damage,
loss of data, delay or any other loss whatsoever caused by events beyond its
reasonable control, including acts of civil or military authority, national
emergencies, fire, flood, catastrophe, acts of God, insurrection, war, riots or
failure of the mails, transportation, communication or power
supply.
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11.
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RIGHTS
OF OWNERSHIP; RETURN OF RECORDS.
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All
records and other data except computer programs and procedures developed to
perform services required to be provided by Ultimus are the exclusive property
of the Trust and all such records and data will be furnished to the Trust in
appropriate form as soon as practicable after termination of this Agreement for
any reason. Ultimus may at its option at any time, and shall promptly
upon the Trust's demand, turn over to the Trust and cease to retain Ultimus'
files, records and documents created and maintained by Ultimus pursuant to this
Agreement which are no longer needed by Ultimus in the performance of its
services or for its legal protection. If not so turned over to the
Trust, such documents and records will be (1) copied and made available to the
Trust by Ultimus as soon as reasonably practical, and (2) retained by Ultimus
for six years from the year of creation. At the end of such six-year period,
such records and documents will be turned over to the Trust unless the Trust
authorizes in writing the destruction of such records and
documents.
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12.
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REPRESENTATIONS
OF THE TRUST.
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The Trust
certifies to Ultimus that: (1) as of the close of business on the
Effective Date, each Portfolio that is in existence as of the Effective Date has
authorized unlimited shares, and (2) this Agreement has been duly authorized by
the Trust and, when executed and delivered by the Trust, will constitute a
legal, valid and binding obligation of the Trust, enforceable against the Trust
in accordance with its terms, subject to bankruptcy, insolvency, reorganization,
moratorium and other laws of general application affecting the rights and
remedies of creditors and secured parties.
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13.
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REPRESENTATIONS
OF ULTIMUS.
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Ultimus
represents and warrants that: (1) it will maintain a disaster
recovery plan and procedures including provisions for emergency use of
electronic data processing equipment, which is reasonable in light of the
services to be provided, and it will, at no additional expense to the Trust,
take reasonable steps to minimize service interruptions (Ultimus shall have no
liability with respect to the loss of data or service interruptions caused by
equipment failure, provided it maintains such plans and procedures); (2) this
Agreement has been duly authorized by Ultimus and, when executed and delivered
by Ultimus, will constitute a legal, valid and binding obligation of Ultimus,
enforceable against Ultimus in accordance with its terms, subject to bankruptcy,
insolvency, reorganization, moratorium and other laws of general application
affecting the rights and remedies of creditors and secured parties; (3) it is
duly registered with the appropriate regulatory agency as a transfer agent and
such registration will remain in full force and effect for the duration of this
Agreement; and (4) it has and will continue to have access to the necessary
facilities, equipment and personnel to perform its duties and obligations under
this Agreement.
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14.
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INSURANCE.
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Ultimus
shall furnish the Trust with pertinent information concerning the professional
liability insurance coverage that it maintains. Such information
shall include the identity of the insurance carrier(s), coverage levels and
deductible amounts. Ultimus shall notify the Trust should any of its
insurance coverage be canceled or reduced. Such notification shall
include the date of change and the reasons therefor. Ultimus shall notify the
Trust of any material claims against it with respect to services performed under
this Agreement, whether or not they may be covered by insurance, and shall
notify the Trust from time to time as may be appropriate of the total
outstanding claims made by Ultimus under its insurance coverage.
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15.
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INFORMATION
TO BE FURNISHED BY THE TRUST.
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The
Trust has furnished to Ultimus the
following:
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(a)
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Copies
of the Agreement and Declaration of Trust (the “Declaration of Trust”) and
of any amendments thereto, certified by the proper official of the state
in which such document has been
filed.
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(b)
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Copies
of the following documents:
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(1)
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The
Trust's By-Laws and any amendments thereto;
and
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(2)
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Certified
copies of resolutions of the Trustees covering the approval of this
Agreement, authorization of a specified officer of the Trust to execute
and deliver this Agreement and authorization for specified officers of the
Trust to instruct Ultimus
thereunder.
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(c)
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A
list of all the officers of the Trust, together with specimen signatures
of those officers who are authorized to instruct Ultimus in all
matters.
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(d)
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Copies
of the Prospectus and Statement of Additional Information for each
Portfolio.
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16.
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AMENDMENTS
TO AGREEMENT.
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This
Agreement, or any term thereof, may be changed or waived only by written
amendment signed by the party against whom enforcement of such change or waiver
is sought.
For
special cases, the parties hereto may amend such procedures set forth herein as
may be appropriate or practical under the circumstances, and Ultimus may
conclusively assume that any special procedure which has been approved by the
Trust does not conflict with or violate any requirements of its Declaration of
Trust or then current prospectuses, or any rule, regulation or requirement of
any regulatory body.
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17.
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COMPLIANCE
WITH LAW.
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Except
for the obligations of Ultimus otherwise set forth herein, the Trust assumes
full responsibility for the preparation, contents and distribution of each
prospectus of the Trust as to compliance with all applicable requirements of the
Securities Act of 1933, as amended (the "Securities Act"), the 1940 Act and any
other laws, rules and regulations of governmental authorities having
jurisdiction. The Trust represents and warrants that no shares of the Trust will
be offered to the public until the Trust's registration statement under the
Securities Act and the 1940 Act has been declared or becomes
effective.
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18.
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NOTICES.
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Any
notice provided hereunder shall be sufficiently given when sent by registered or
certified mail to the party required to be served with such notice, at the
following address: if to the Trust, at Three Ygnacio Center, 0000 Xxxxx Xxxx
Xxxxxx, Xxxxx 000, Xxxxxx Xxxxx, Xxxxxxxxxx 00000, Attn: Xxxxxxx X. Xxxxxxxxx;
and if to Ultimus, at 000 Xxxxxxxx Xxxxx, Xxxxx 000, Xxxxxxxxxx, Xxxx 00000,
Attn: Xxxxxx X. Xxxxxx; or at such other address as such party may from time to
time specify in writing to the other party pursuant to this
Section.
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19.
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ASSIGNMENT.
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This
Agreement and the rights and duties hereunder shall not be assignable by either
of the parties hereto except by the specific written consent of the other
party. This Agreement shall be binding upon, and shall inure to the
benefit of, the parties hereto and their respective successors and permitted
assigns.
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20.
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GOVERNING
LAW.
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This
Agreement shall be construed in accordance with the laws of the State of Ohio
and the applicable provisions of the 1940 Act. To the extent that the applicable
laws of the State of Ohio, or any of the provisions herein, conflict with the
applicable provisions of the 1940 Act, the latter shall control.
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21.
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LIMITATION
OF LIABILITY.
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A copy of
the Declaration of Trust is on file with the Secretary of the State of Ohio, and
notice is hereby given that this instrument is executed on behalf of the
Trustees and not individually and that the obligations of this instrument are
not binding upon any of the Trustees, officers or shareholders individually but
are binding only upon the assets and property of the
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Trust (or
if the matter relates only to a particular Portfolio, that Portfolio), and
Ultimus shall look only to the assets of the Trust, or the particular Portfolio,
for the satisfaction of such obligations.
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22.
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MULTIPLE
ORIGINALS.
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This
Agreement may be executed in two or more counterparts, each of which when so
executed shall be deemed to be an original, but such counterparts shall together
constitute but one and the same instrument.
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed all as of the day and year first above written.
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By:
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/s/Xxxxxxx
X. Xxxxxxxxx
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Title:
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President
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ULTIMUS
FUND SOLUTIONS, LLC
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By:
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/s/Xxxxxx
X. Xxxxxx
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Title:
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President
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SCHEDULE
A
TO
THE FUND ACCOUNTING AGREEMENT BETWEEN
AND
ULTIMUS
FUND SOLUTIONS, LLC
FUND
PORTFOLIOS
Destination
Select Equity Fund
10
Amended: January 1,
2009
SCHEDULE
B
TO
THE FUND ACCOUNTING AGREEMENT BETWEEN
AND
ULTIMUS
FUND SOLUTIONS, LLC
FEES AND
EXPENSES
FEES:
Ultimus
shall be entitled to receive a fee from the Trust on the first business day
following the end of each month, or at such time(s) as Ultimus shall request and
the parties hereto shall agree, a fee computed with respect to each Portfolio as
follows:
Base fee
per year = $30,000, ($2,500 per month), plus
Asset
based fee of:
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Average
Daily Net Assets
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Asset
Based Fee
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First
$500 million
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.010%
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In
excess of $500 million
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.005%
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The above
fee will discounted by 20% for the period January 1, 2009 to December 31,
2009.
The above
base fee assumes one class of shares. For a Portfolio that offers
more than one class of shares, the base fee is $36,000 (two classes) or $42,000
(three classes).
The
forgoing fees include 200 portfolio trades per month (exclusive of daily cash
investments). For Portfolios with more than 200 trades in a month,
Ultimus will charge $5.00 for each trade in excess of 200.
PERFORMANCE
REPORTING:
For
Performance Reporting (including After-Tax Performance Reporting), Ultimus
charges each Portfolio a fee of $200 per month.
OUT-OF-POCKET
EXPENSES:
The fees
set forth above shall be in addition to the payment of out-of-pocket expenses,
as provided for in Section 4 of this Agreement.
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