EXHIBIT 99.23(h)(3)
FUND ACCOUNTING SERVICING AGREEMENT
This Agreement between The Xxxxxxx Funds, a Delaware business trust
(hereinafter called the "Trust," on behalf of its separate series of shares
("Series") or classes of such Series ("Classes"), all as described herein (as
such part may be amended from time to time), and Firstar Mutual Fund Services,
LLC, a limited liability company organized under the laws of the State of
Wisconsin (hereinafter called "FTC"), is entered into on this _____ day of
November, 1998.
WHEREAS, the Trust, is an open-ended management investment company
registered under the Investment Company Act of 1940, as amended (the "1940
Act"); and
WHEREAS, FTC is in the business of providing mutual fund accounting
services to investment companies.
NOW, THEREFORE, the Trust and FTC do mutually promise and agree as
follows:
1. Services. FTC agrees to provide the following mutual fund
accounting services to the Trust on a per Series or per Class basis as
appropriate:
A. Portfolio Accounting Services:
(1) Maintain portfolio trading records (purchase and sale
journals for each Series) on a trade date +1 basis using
security trade information communicated from the Series'
investment manager on a timely basis.
(2) Monitor corporate action to identify and record interest
and dividend income on portfolio securities and maintain
accrual balances as of each valuation date and calculate gross
earnings on investments for the accounting period.
(3) Determine gain/loss on portfolio security sales and
identify them as to short-short, 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.
(4) Maintain appropriate records of brokerage activity for
transactions in portfolio securities to enable FTC to provide
monthly brokerage reports showing brokers and commission
amounts.
(5) Maintain a daily listing of portfolio holdings by Series
showing cost, market value, and the percentage of portfolio
comprised of each security.
(6) Reconcile accounting asset listings against custodian's
asset listings on at least a monthly basis and report any
securities balance discrepancies promptly to the Trust and
Custodian.
B. Expense Accrual and Payment Services:
(1) For each valuation date, calculate the expense accrual
amounts as directed by the Trust as to methodology, rate or
dollar amount.
(2) Upon receipt of written authorization from the Trust, make
and record payments for Trust expenses.
(3) Account for Trust and Series expenditures and maintain
expense accrual balances at the level of accounting detail, as
agreed upon by FTC and the Trust.
(4) Provide expense accrual and payment reporting.
C. Fund Valuation and Financial Reporting Services:
(1) Calculate and maintain daily records of the net asset
value (and offering price if appropriate) of each Series (or
class of such Series if appropriate), at such times (each a
"valuation date") as directed and authorized by the Trust
through FTC's questionnaire and in accordance with: (i)
relevant regulatory requirements; (ii) the Trust's Declaration
of Trust and By-Laws; (iii) the Trust's registration statement
or Form N-IA; and (iv) any procedures approved by the Board of
Trustees of the Trust and supplied to FTC in writing.
(2) In connection with the calculation of relevant net asset
values, FTC shall obtain prices for portfolio securities from
pricing services approved by the Trust, and will apply those
prices to the portfolio securities. For those securities where
market quotations are not readily available, the Board of
Trustees shall approve, in good faith, the method for
determining the fair value for such securities. If the Trust
desires to provide a price which varies from the pricing
source, the Trust shall promptly notify and supply FTC with
the valuation of any such security on each valuation date. All
pricing changes made by the Trust will be in writing and must
specifically identify the securities to be changed by CUSIP,
name of security, new price or rate to be applied, and, if
applicable, the time period for which the new price(s) is/are
effective.
(3) On trade date +1, account for and record purchases, sales,
exchanges, transfers, dividend reinvestments, and other
transactions in shares of the Trust, its Series as reported by
the transfer agent on a timely basis.
(4) Apply equalization accounting as directed by the Trust.
(5) Determine net investment income (earnings) for each Series
of the Trust 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.
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(6) Maintain a general ledger for the Trust and each of its
Series in the form as agreed upon.
(7) Communicate, at an agreed upon time, the per share price
for each valuation date to the Trust and its investment
advisers as agreed upon from time to time.
D. Tax Accounting Services:
(1) Maintain accounting records for each Series' investment
portfolio to support the tax reporting required for
IRS-defined regulated investment companies.
(2) Maintain tax lot detail for each Series' investment
portfolio.
(3) Calculate taxable gain/loss on security sales using the
tax lot relief method designated by the Trust.
(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.
(5) Maintain schedules of dividends paid and payable.
E. Compliance Control Services:
(1) Support reporting to regulatory bodies and support
financial statement preparation by making the Trust's
accounting records available to the Trust and its investment
manager, the Securities and Exchange Commission, and the
outside auditors.
(2) Maintain accounting records according to the 1940 Act and
regulations provided thereunder.
2. Changes in Accounting Procedures. Any resolution passed by the Board of
Trustees of the Trust that affects accounting practices and procedures under
this agreement shall be effective upon written receipt and acceptance by the
FTC.
3. Changes in Equipment, Systems, Service, Etc. FTC 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 Trust under this
Agreement.
4. Compensation. FTC 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.
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5. Performance of Service.
A. FTC shall exercise reasonable care in the performance of its
duties under this Agreement. FTC shall not be liable for any loss suffered
by the Fund in connection with matters to which this Agreement relates,
including losses resulting from mechanical breakdowns or the failure of
communication or power supplies beyond FTC's control, except a loss
resulting from FTC's refusal or failure to comply with the terms of this
Agreement or from bad faith, negligence, or willful misconduct on its part
in the performance of its duties under this Agreement. Notwithstanding any
other provision of this Agreement, the Fund shall indemnify and hold
harmless FTC from and against any and all claims, demands, losses,
expenses, and liabilities (whether with or without basis in fact or law)
of any and every nature (including reasonable attorneys' fees) which FTC
may sustain or incur or which may be asserted against FTC by any person
arising out of any action taken or omitted to be taken by it in performing
the services hereunder (i) in accordance with the foregoing standards, or
(ii) in reliance upon any written or oral instruction provided to FTC by
any duly authorized officer of the Fund, such duly authorized officer to
be included in a list of authorized officers furnished to FTC and as
amended from time to time in writing by resolution of the Board of
Directors of the Fund.
In the event of a mechanical breakdown or failure of communication
or power supplies beyond its control, FTC shall take all reasonable steps
to minimize service interruptions for any period that such interruption
continues beyond FTC's control. FTC will make every reasonable effort to
restore any lost or damaged data and correct any errors resulting from
such a breakdown at the expense of FTC. FTC 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 FTC's premises
and operating capabilities at any time during regular business hours of
FTC, upon reasonable notice to FTC.
Regardless of the above, FTC reserves the right to reprocess and
correct administrative errors at its own expense.
B. In order that the indemnification provisions contained in this
section shall apply, it is understood that if in any case the Trust may be
asked to indemnify or hold FTC harmless, the Trust shall be fully and
promptly advised of all pertinent facts concerning the situation in
question, and it is further understood that FTC will use all reasonable
care to notify the Trust promptly concerning any situation which presents
or appears likely to present the probability of such a claim for
indemnification against the Trust. The Trust shall have the option to
defend FTC against any claim which may be the subject of this
indemnification. In the event that the Fund so elects, it will so notify
FTC and thereupon the Trust shall take over complete defense of the claim,
and FTC shall in such situation initiate no further legal or other
expenses for which it shall seek indemnification under this section. FTC
shall in no case confess any claim or make any compromise in any case in
which the Trust will be asked to indemnify FTC except with the Trust's
prior written consent.
C. FTC shall indemnify and hold the Trust harmless from and against
any and all claims, demands, losses, expenses, and liabilities (whether
with or without basis in fact or law) of any and every nature (including
reasonable attorneys' fees) which may be asserted against the
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Trust by any person arising out of any action taken or omitted to be taken
by FTC as a result of FTC's refusal or failure to comply with the terms of
this Agreement, its bad faith, negligence, or willful misconduct.
6. Records. FTC shall keep records relating to the services to be
performed hereunder, in the form and manner, and for such period as it may deem
advisable and is agreeable to the Trust and as required by the rules and
regulations of appropriate government authorities, in particular, Section 31 of
the 1940 Act and the rules thereunder. FTC agrees that all such records prepared
or maintained by FTC relating to the services to be performed by FTC hereunder
are the property of the Trust and will be preserved, maintained, and made
available with such section and rules of the 1940 Act and will be promptly
surrendered to the Trust on and in accordance with its request.
7. Confidentiality. FTC shall handle in confidence all information
relating to the Trust's or its investment manager's business, which is received
by FTC during the course of rendering any service hereunder.
8. Data Necessary to Perform Services. The Trust or its agent, which may
be FTC, shall furnish to FTC the data necessary to perform the services
described herein at times and in such form as mutually agreed upon.
9. Notification of Error. The Trust will notify FTC of any balancing or
control error caused by FTC within three (3) business days after receipt of any
reports rendered by FTC to the Trust, 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.
10. Additional Series. In the event that the Trust establishes one or more
Series or Classes of shares with respect to which it desires to have FTC render
accounting services, under the terms hereof, it shall so notify FTC in writing,
and if FTC agrees in writing to provide such services, such series will be
subject to the terms and conditions of this Agreement, and shall be maintained
and accounted for by FTC on a discrete basis. The series and classes currently
covered by this Agreement are: "The Xxxxxxx Growth Fund."
11. Term of Agreement. This Agreement shall become effective on
___________ and, unless sooner terminated as provided herein, shall continue
automatically in effect for successive annual periods, provided that the
continuance of the Agreement is approved by a majority of the Trustees of the
Trust. The Agreement may also 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 and will terminate automatically upon its
assignment unless the parties offer consent in writing. 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 FTC's duties or responsibilities
hereunder is designated by Trust by written notice to FTC, FTC will promptly,
upon such termination and at the expense of Trust, transfer to such Successor
all relevant books, records, correspondence and other data established or
maintained by FTC under this Agreement in a form reasonably acceptable to Trust
(if such form differs from the form in which FTC has maintained the same, Trust
shall pay any expenses associated with transferring the same to such
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form), and will cooperate in the transfer of such duties and responsibilities,
including provision for assistance from FTC's personnel in the establishment of
books, records and other data by such successor.
13. Notices. Notices of any kind to be given by either party to the other
party shall be in writing and shall be duly given if mailed or delivered as
follows: Notice to FTC shall be sent to:
Firstar Mutual Fund Services, LLC
000 Xxxx Xxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
and notice to the Trust shall be sent to:
The Xxxxxxx Funds
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
14. 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.
THE XXXXXXX FUNDS FIRSTAR TRUST COMPANY
By: By:
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Title: Title:
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Date: Date:
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Attest: Attest:
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Schedule A
Fund Valuation and Accounting
Domestic Portfolios
Annual Fee Schedule
Fixed Income Funds
o Annual fee per fund based on market value of assets;
o $25,000 for the first $40,000,000
o 2/100 of 1% (2 basis points) on the next $200,000,000
o 1/100 of 1% (1 basis point) on the balance
o out-of-pocket expenses, including daily pricing service
Equity/Balance Funds
o Annual fee per fund based on market value of assets;
o $23,000 for the first $40,000,000
o 1/100 of 1% (1 basis point) on the next $200,000,000
O 5/1000 of 1% (1/2 basis point) on the balance
o Out-of-pocket expenses, including daily pricing service
Money Market Funds
o Annual fee per fund based on market value of assets:
o $25,000 for the first $40,000,000
o 1/100 of 1% (1 basis point) on the next $200,000,000
o 5/1000 of 1% (1/2 basis point) on the balance
o Out-of-pocket expenses, including daily pricing service
All fees and out-of-pocket expenses are billed monthly.
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Schedule B
Fund Valuation and Accounting Asset Pricing Cost
Charge per Item per Valuation
Asset Type (daily, weekly, etc.)
Domestic and Canadian Equities $0.15
Options $0.15
Corporate/Government/Agency Bonds $0.50
CMOs $0.80
International Equities and Bonds $0.50
Municipal Bonds $0.80
Money Market Instruments $0.80
Pricing costs are billed monthly.
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