EXHIBIT (h)(5)
FUND ACCOUNTING AGREEMENT
WITH AMERICAN DATA SERVICES, INC.
FUND ACCOUNTING SERVICE AGREEMENT
AGREEMENT made the 30th day of June 1999, by and between the ORBITEX Group of
Funds, a Delaware Business Trust, having its principal office and place of
business 000 Xxxx Xxxxxx, Xxx Xxxx, XX 00000 (the "Trust"), and American Data
Services, Inc., a New York corporation having its principal office and place of
business at the Hauppauge Corporate Center, 000 Xxxxx Xxxxxxx, Xxxxx 000,
Xxxxxxxxx, Xxx Xxxx 00000 ("ADS").
BACKGROUND
WHEREAS, the Trust(3) consists of various series listed in Schedule A
(collectively referred to as the "Funds") of diversified and non-diversified,
open-end management investment company registered with the United States
Securities and Exchange Commission under the Investment Company Act of 1940, as
amended (the "1940 Act"); and
WHEREAS, ADS is a corporation experienced in providing accounting services to
mutual funds and possesses facilities sufficient to provide such services; and
WHEREAS, the Trust desires to avail itself of the experience, assistance and
facilities of ADS and to have ADS perform for the Trust certain services
appropriate to the operations of the Funds, and ADS is willing to furnish such
services in accordance with the terms hereinafter set forth.
TERMS
NOW, THEREFORE, in consideration of the promises and mutual covenants
hereinafter contained, the Trust and ADS hereby agree as follows:
1. DUTIES OF ADS.
ADS will provide the Trust with the necessary office space,
communication facilities and personnel to perform the following services for the
Trust:
(a) Timely calculate and transmit to NASDAQ the Funds' daily net
asset value and communicate such value to the Funds and their
transfer agent;
(b) Maintain and keep current all books and records of the Funds as
required by Rule 31a-1 under the 1940 Act, as such rule or any
successor rule may be amended from time to time ("Rule 31a-1"),
that are applicable to the fulfillment of ADS's duties
hereunder, as well as any other documents necessary or advisable
for compliance with applicable regulations as may be mutually
agreed to between the Trust and ADS. Without limiting the
generality of the foregoing, ADS will prepare and maintain the
following records upon receipt of information in proper form
from the Funds or their authorized agents:
- Cash receipts journal
- Cash disbursements journal
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(3) The term "Trust" shall refer to the ORBITEX Group of Funds, and each series
of the ORBITEX Group of Funds that is approved by the Board of Trustees of the
ORBITEX Group of Funds for inclusion under the terms of this agreement, and each
series that is so approved shall be subject to the terms of this Agreement
without the need for an amendment of or addition to this Agreement.
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- Dividend record
- Purchase and sales - portfolio securities journals
- Subscription and redemption journals
- Security ledgers
- Broker ledger
- General ledger
- Daily expense accruals
- Daily income accruals
- Securities and monies borrowed or loaned and collateral
therefore
- Foreign currency journals
- Trial balances
(c) Provide the Funds and their investment adviser with daily
portfolio valuation, net asset value calculation and other
standard operational reports as requested from time to time.
(d) Provide all raw data available from our fund accounting system
(PAIRS) for management's or the administrators preparation of
the following:
1. Semi-annual financial statements;
2. Semi-annual form N-SAR;
3. Annual tax returns;
4. Financial data necessary to update form N-1a;
5. Annual proxy statement.
(e) Provide facilities to accommodate annual audit and any audits or
examinations conducted by the Securities and Exchange Commission
or any other governmental or quasi-governmental entities with
jurisdiction.
ADS 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 Trust in any way or otherwise be deemed an agent of the
Trust.
2. COMPENSATION OF ADS.
In consideration of the services to be performed by ADS as set forth
herein for each portfolio approved for inclusion hereunder by the Board of
Trustees of the Trust, ADS shall be entitled to receive compensation and
reimbursement for all reasonable out-of-pocket expenses. The Trust agrees to pay
ADS the fees and reimbursement of out-of-pocket expenses as set forth in the fee
schedule attached hereto as Schedule A.
3. LIMITATION OF LIABILITY OF ADS.
(a) ADS shall be held to the exercise of reasonable care in carrying
out the provisions of the Agreement, but shall be without liability to the Trust
for any action taken or omitted by it in good faith without gross negligence,
bad faith, willful misconduct or reckless disregard of its duties hereunder. It
shall be entitled to rely upon and may act upon the accounting records and
reports generated by the Trust, advice of the Trust, or of counsel for the Trust
and upon statements of the Trust's independent accountants, and shall be without
liability for any action reasonably taken or omitted pursuant to such records
and reports or advice, provided that such action is not, to the knowledge of
ADS, in violation of applicable federal or state laws or regulations, and
provided further that such action is taken without gross negligence, bad faith,
willful misconduct or reckless disregard of its duties.
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(b) Nothing herein contained shall be construed to protect ADS against
any liability to the Trust or its security holders to which ADS shall otherwise
be subject by reason of willful misfeasance, bad faith, gross negligence in the
performance of its duties on behalf of the Trust, reckless disregard of ADS'
obligations and duties under this Agreement or the willful violation of any
applicable law.
(c) Except as may otherwise be provided by applicable law, neither ADS
nor its stockholders, officers, directors, employees or agents shall be subject
to, and the Trust shall indemnify and hold such persons harmless from and
against, any liability for and any damages, expenses or losses incurred by
reason of the inaccuracy of information furnished to ADS by the Trust or its
authorized agents.
4. REPORTS.
(a) The Trust shall provide to ADS on a quarterly basis a report of a
duly authorized officer of the Trust representing that all information furnished
to ADS during the preceding quarter was true, complete and correct in all
material respects. ADS shall not be responsible for the accuracy of any
information furnished to it by the Trust or its authorized agents, and the Trust
shall hold ADS 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, ADS determines, on the basis of information supplied to ADS by the
Trust 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, ADS shall promptly notify
the Trust and its counsel of such violation.
5. ACTIVITIES OF ADS.
The services of ADS under this Agreement are not to be deemed
exclusive, and ADS shall be free to render similar services to others so long as
its services hereunder are not impaired thereby.
6. ACCOUNTS AND RECORDS.
The accounts and records maintained by ADS shall be the property of the
Trust, and shall be surrendered to the Trust, at the expense of the Trust,
promptly upon request by the Trust, provided that all service fees and expenses
charged by ADS in the performance of its duties hereunder have been fully paid
to the satisfaction of ADS, in the form in which such accounts and records have
been maintained or preserved. ADS agrees to maintain a back-up set of accounts
and records of the Trust (which back-up set shall be updated on at least a
weekly basis) at a location other than that where the original accounts and
records are stored. ADS shall assist the Trust's independent auditors, or, upon
approval of the Trust, any regulatory body, in any requested review of the
Trust's accounts and records. ADS shall preserve the accounts and records as
they are required to be maintained and preserved by Rule 31a-1.
7. CONFIDENTIALITY.
ADS agrees that it will, on behalf of itself and its officers and
employees, treat all transactions contemplated by this Agreement, and all other
information germane thereto, as confidential and not to be disclosed to any
person except as may be authorized by the Trust.
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8. DURATION AND TERMINATION OF THIS AGREEMENT.
This Agreement shall become effective as of the date hereof and shall
remain in force for a period of three (3) years, provided however, that both
parties to this Agreement have the option to terminate the Agreement, without
penalty, upon ninety (90) days prior written notice.
Should the Trust exercise its right to terminate, all out-of-pocket
expenses associated with the movement of records and material will be borne by
the Trust. Additionally, ADS reserves the right to charge for any other
reasonable expenses associated with such termination.
9. ASSIGNMENT.
This Agreement shall extend to and shall be binding upon the parties
hereto and their respective successors and assigns; provided, however, that this
Agreement shall not be assignable by the Trust without the prior written consent
of ADS, or by ADS without the prior written consent of the Trust.
10. NEW YORK LAWS TO APPLY.
The provisions of this Agreement shall be construed and interpreted in
accordance with the laws of the State of New York as at the time in effect and
the applicable provisions of the 1940 Act. To the extent that the applicable law
of the State of New York, or any of the provisions herein, conflict with the
applicable provisions of the 1940 Act, the latter shall control.
11. AMENDMENTS TO THIS AGREEMENT.
This Agreement may be amended by the parties hereto only if such
amendment is in writing and signed by both parties.
12. MERGER OF AGREEMENT.
This Agreement constitutes the entire agreement between the parties
hereto and supersedes any prior agreement with respect to the subject matter
hereof whether oral or written.
13. NOTICES.
All notices and other communications hereunder shall be in writing,
shall be deemed to have been given when received or when sent by telex or
facsimile, and shall be given to the following addresses (or such other
addresses as to which notice is given):
To the Trust: To ADS:
M. Fyzul Khan Xxxxxxx Xxxxx
Secretary President
ORBITEX Group of Funds American Data Services, Inc.
000 Xxxx Xxxxxx, 00xx Xxxxx 000 Xxxxx Xxxxxxx, Xxxxx 000
Xxx Xxxx, XX 00000 Xxxxxxxxx, XX 00000
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year first above written.
ORBITEX Group of Funds AMERICAN DATA SERVICES, INC.
By: By:
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Xxxxx X. Xxxxxx, President Xxxxxxx Xxxxx, President
SCHEDULE A
FUND LISTING
Orbitex Internet Fund
Orbitex Emerging Technologies Fund
Orbitex Strategic Infrastructure Fund
Orbitex Health & Biotechnology Fund
Orbitex Financial Services Fund
Orbitex Focus 30 Fund
SCHEDULE B
FUND ACCOUNTING FEE SCHEDULE
FUND ACCOUNTING SERVICE FEE
For the services rendered by ADS in its capacity as fund accounting agent, the
Fund shall pay ADS, within ten (10) days after receipt of an invoice from ADS at
the beginning of each month, a fee equal to:
MONTHLY FEE PER PORTFOLIO (BASED UPON PRIOR MONTH AVERAGE NET ASSETS):
Fund net assets up to $20 million:
$2,000 per Fund per month
$1,000 per additional class, in excess of initial class, per month
Fund net assets (except the Cash Reserves Fund) greater than $20 million:
$2,000 per Fund per month
$1,000 per additional class, in excess of initial class, per month
Two (2) basis points (.002%) on all assets between $25
million and $100 million
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One (1) basis point (.001%) on all assets greater than $100 million
Cash Reserves Fund net assets greater than $100 million:
$4,000 per Fund per month
$1,000 per additional class, in excess of initial class, per month
On each annual anniversary date of this Agreement, the fees enumerated above
will be increased by the change in the Consumer Price Index for the Northeast
region (CPI) for the twelve-month period ending with the month preceding such
annual anniversary date. Any CPI increases not charged in any given year may be
included in prospective CPI fee increases in future years.
OUT OF POCKET EXPENSES
The Fund shall reimburse ADS for any out-of-pocket expenses, exclusive of
salaries, advanced by ADS in connection with but not limited to the printing or
filing of documents for the Fund, travel, telephone, quotation services
(currently (1) $0.12 per equity valuation, $0.60 per bond valuation, and 1.50
for each foreign quotation or manual quote insertion), facsimile transmissions,
stationery and supplies, record storage, NASDAQ insertion fee ($22 (1) per
month), pro rata portion of annual SAS 70 review, postage, telex, and courier
charges, incurred in connection with the performance of its duties hereunder.
ADS shall provide the Fund with a monthly invoice of such expenses and the Fund
shall reimburse ADS within fifteen (15) days after receipt thereof.
(1) Rate subject to change on 30 days notice.
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SPECIAL REPORTS
All reports and /or analyses requested by the Fund, its auditors, legal counsel,
portfolio manager, or any regulatory agency having jurisdiction over the Fund,
that are not in the normal course of fund accounting activities as specified in
Section 1 of this Agreement shall be subject to an additional charge, agreed
upon in advance, based upon the following rates:
Labor:
Senior staff - $150.00/hr.
Junior staff - $ 75.00/hr.
Computer time - $45.00/hr.
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