ACCOUNTING SERVICES AGREEMENT
ASM FUND, INC.
and
MUTUAL FUNDS SERVICE CO.
This Agreement, dated the 31st day of December 1993, made by and between
ASM Fund, Inc., a Maryland corporation (the "Fund"), and Mutual Funds
Service Co., an Ohio corporation ("Agent").
WITNESSETH THAT:
WHEREAS, the Fund desires to appoint the Agent as its Accounting Services
Agent to perform certain accounting and recordkeeping functions required of a
duly registered investment company; to file certain financial reports; to
maintain and preserve certain books, accounts, and records as the basis for
such reports; and to perform certain daily functions in connection with such
accounts and records;
WHEREAS, the Agent is willing to perform such functions upon the terms
and conditions herein set forth; and
WHEREAS, pursuant to a separate agreements, the Agent will perform the
duties of administrator, transfer agent, and dividend disbursing agent for
the Fund.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, the parties hereto agree as follows:
Section 1. The Fund shall turn over to the Agent the accounts and
records previously maintained by or for the Fund. The Agent shall be
entitled to rely exclusively on the completeness and correctness of the
accounts and records turned over to it by the Fund, and the Fund shall
indemnify and hold the Agent harmless of and from any and all expenses
(including without limitation, attorneys and accountants' fees), damages,.
claims, suits, liabilities, actions, demands, and losses whatsoever arising
out of or in connection with any error, omission, inaccuracy, or other
deficiency of such accounts and records or in connection with the failure of
the Fund to provide any portion of such accounts and records or to provide
any information to the Agent necessary or appropriate to perform its
functions hereunder.
Accounts, records and other information shall belong to the Fund and be
considered confidential. Accounts, records and other information will not be
disclosed to other than federal and state regulators without permission from
the Fund.
Section 2. The Agent shall examine and review the Fund's existing
accounts, records, pertinent documents and systems in order to determine or
recommend how such accounts, records, documents and systems shall be
maintained.
Section 3. Upon receipt of necessary and appropriate information and
instructions from the Fund, the Agent shall maintain and keep current and
accurate the following books, accounts, records, journals, or other records
of original entry, relating to the business of the Fund, and necessary or
appropriate for compliance with applicable regulations, including Rules
31(a)-1 and 31(a)-2, of the Investment Company Act of 1940, as amended, and
as may be mutually agreed to between the Fund and the Agent:
(a) Cash Receipts
(b) Cash Disbursements
(c) Dividend Record
(d) Purchase and Sales of Portfolio Securities
(e) Subscription and Redemption Journals
(f) Security Ledger
(g) Broker Ledger
(h) General Ledger
(i) Daily Expense Accruals
(j) Daily Interest Accruals
(k) Securities and Monies borrowed or loaned and collateral therefor
(l) Trial Balances
Unless appropriate information necessary to perform the above functions
is furnished to the Agent in a timely manner, the Agent shall incur no
liability to the Fund or any other person. The Agent shall promptly notify
the Fund in writing of any discrepancy, error or non-compliance in items (a)
through (l) above of which it has knowledge.
The Agent shall maintain all accounts and records mentioned above as
required by regulation and as agreed upon between the Fund and the Agent.
Section 4. Upon receipt by the Agent of written or oral instructions from
the Fund, the Agent shall make proper accounting entries in accordance with
G.A.A.P. and SEC regulations. The Fund shall direct that each broker-dealer,
or other person through whom a transaction has occurred, shall send a
confirmation thereof to the Agent. The Agent shall verify this confirmation
against the written or oral instructions when received from the Fund and
forward the confirmation to the Custodian. The Agent shall promptly notify
the Fund of any discrepancy between the confirmation and the Fund's written
instructions when received from the Fund but shall incur no responsibility or
liability for such discrepancy. The Fund shall cause any necessary
corrections to be made and shall advise the Agent and the Custodian
accordingly.
Section 5. The Agent shall calculate the Fund's net asset value per share
in accordance with the Fund's currently effective prospectus, once daily.
The Agent shall prepare and maintain a daily evaluation of Securities for
which market quotations are available by the Agent's use of Bloomberg and ILX
quotation services; all other Securities shall be
evaluated in accordance with the Fund's written instructions, and the Agent
shall have no responsibility or liability for the accuracy of the information
supplied by the Fund or provided in the written instructions.
The Fund assumes all responsibility for computation of "amortized
cost", valuation of securities, and all valuations not ascertainable solely
by mechanical procedures.
Section 6. At the end of each month, the Agent shall obtain from the
Custodian a monthly statement of cash and portfolio transactions, which shall
be reconciled with the Agent's accounts and records maintained for the Fund.
The Agent shall report any discrepancies to the Custodian, and report any
unreconciled items to the Fund.
Section 7. The Agent shall supply daily and periodic reports to the Fund,
as required by law or regulation, and as requested by the Fund and agreed
upon by the Agent.
Section 8. The Fund shall report and confirm to the Transfer Agent all
Share purchases and redemptions of which it is aware. The Agent shall obtain
from the Transfer Agent daily reports of Share purchases, redemptions, and
total shares outstanding.
The Agent shall reconcile outstanding Shares with the Transfer Agent
periodically and certify at least monthly to the Fund the reconciled Share
balance outstanding.
Section 9. The accounts and records of the Fund maintained by the Agent
shall be the property of the Fund, and shall be made available to the Fund,
within a reasonable period of time, upon demand. The Agent shall assist the
Fund's independent auditors, and upon approval of the Fund, or upon demand by
any governmental or quasi-governmental entity, assist any such entity in any
requested review of the Fund's accounts and records but shall be reimbursed
for all expenses and employee time invested in any such review outside of
routine and normal periodic reviews. Upon receipt from the Fund of the
necessary information, the Agent shall supply the necessary data for the
Fund's completion of any necessary tax returns, questionnaires, periodic
reports to Shareholders, and such other reports and information requests as
the Fund and the Agent shall agree upon from time to time.
Section 10. The Agent and the Fund may from time to time adopt uniform or
standard procedures, and the Agent may conclusively assume that any procedure
approved by the Fund, or directed by the Fund, does not conflict with or
violate any requirements of its prospectus, Articles of Incorporation,
By-Laws, or other governing documents, or any rule or regulation of any
regulatory body or governmental agency. The Fund shall be responsible to
notify the Agent of any changes in regulations or rules which might
necessitate changes in the Agent's procedures.
Section 11. The Agent may rely upon the advice of the Fund and upon
statements of the Fund's accountants and other persons believed by it in good
faith to be expert in matters upon which they are consulted, and the Agent
shall not be liable for any actions taken in good faith upon such statements.
Section 12. The Agent shall not be liable for any action taken in good
faith reliance upon any authorized oral instructions, any written
instructions, any certified copy of any resolution of the Board of Directors
of the Fund or any other document reasonably believed by the Agent to be
genuine and to have been executed or signed by the proper person or persons.
The Fund will send written instructions to confirm oral instructions, and the
Agent will compare the written instructions against the oral instructions
previously furnished. The Agent will inform the Fund promptly of any noted
discrepancy.
The Agent shall not be held to have notice of any change or lack of
authority of any officer, employee, or agent of the Fund until receipt of
written notification thereof by the Fund.
In addition to indemnification expressly provided elsewhere in this
Agreement, the Fund shall indemnify Agent and save it harmless from and
against all actions, suits and claims, whether groundless or otherwise,
arising directly or indirectly out of or in connection with its performance
under this Agreement and from and against any and all losses, damages, costs,
charges, attorney and accountant's fees, payments, expenses and liabilities
incurred by Agent in connection with any such action, suit, or claim unless
caused by Agent's breach of this Agreement, negligence or willful misconduct.
Agent shall not be under any obligation to prosecute or to defend any action,
suit or claim arising out of or in connection with its performance under this
Agreement, which, in the opinion of its counsel, may involve it in expense or
liability, and the Fund shall, so often as reasonably requested, furnish
Agent with satisfactory indemnity against such expense or liability, and upon
request of Agent, the Fund shall assume the entire defense of any action,
suit, or claim subject to the foregoing indemnity; provided, however, that
Agent shall give the Fund notice of any such action, suit, or claim brought
against Agent.
Agent shall indemnify and hold harmless the Fund from all claims and
liabilities (including reasonable attorneys' and accountants' expenses)
incurred or assessed against the Fund arising from the Agent's negligence,
willful misconduct or breach of this Agreement.
Section 13. The shareholders, directors, officers, employees and agents
of the Fund shall not be personally bound by or liable hereunder, nor shall
resort be had to their private property for the satisfaction of any
obligation or claim hereunder as provided for in the Articles of
Incorporation.
Section 14. The Fund agrees to pay the Agent compensation for its
services and to reimburse it for expenses, as set forth in Schedule A
attached hereto, or as shall be set forth in amendments to such Schedule
approved by the Fund and the Agent.
Section 15. Nothing contained in this Agreement is intended to or shall
require the Agent, in any capacity hereunder, to perform any functions or
duties on any holiday or other day of special observance on which the New
York Stock Exchange is closed. Functions or duties normally scheduled to be
performed on such days shall be performed on, and as of, the next business
day on which both the New York Stock Exchange and the Agent are open.
Section 16. This Agreement may be terminated by either party upon 60
days' prior written notice.
Section 17. 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:
ASM Fund, Inc.
00000 Xxxxx Xxxxxxx Xxxxxx, Xxxxx 000
Xxxxx, XX 00000
ATTN: President
IF TO THE AGENT:
Mutual Funds Service Co.
Attention: Xxxxxx X. Xxxxxx, President
0000 Xxxxxxxx Xxxxx
Xxx 0000
Xxxxxx, XX 00000
Section 18. 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.
Section 18. This Agreement shall be binding upon the parties hereto and
their respective successors and assigns, provided, however, that this
Agreement shall not be assignable by the Fund without the written consent of
the Agent, or by the Agent without the written consent of the Fund, in each
case authorized or approved by a resolution of its Directors.
Section 20. This Agreement shall be governed by the laws of the State of
Ohio, without reference to its choice of law rules.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
signed by their duly authorized officers as of the day and year first above
written.
ASM FUND, INC.
By /s/ Xxxxxx X. Xxxxx
------------------------------
Its: President
----------------------------
ATTEST: /s/ Xxxxxxx Xxxxxxx
-------------------------
MUTUAL FUNDS SERVICE CO.
By /s/ Xxxxxx X. Xxxxxx
------------------------------
Its: President
----------------------------
ATTEST: /s/ Xxxxxx X. Xxxx
-------------------------
MUTUAL FUNDS SERVICE CO.
FEE SCHEDULE FOR ACCOUNTING SERVICES
ASM FUND, INC.
A. MINIMUM ANNUAL FEE - $20,000 (Based upon average net assets - payable
monthly)
BASIS POINT FEE
8 Basis Points on first $30 million of assets
3 Basis Points on next $20 million of assets
1 Basis Points on next $50 million of assets
.6 Basis Points on assets over $100 million
B. In addition, all out-of-pocket expenses shall be separately charged,
shall include but not be limited to: printed forms, postage, overnight
mail and telephone expense.
