COMPLIANCE SERVICES AGREEMENT
Exhibit (h)(6)
AGREEMENT dated as of April 1, 2016 (the “Effective Date”) among Capstone Church Capital Fund (the “Church Fund”), a statutory trust organized under the laws of Delaware, Capstone Series Fund, Inc. (“CSF”), a corporation organized under the laws of Maryland, Xxxxxxx Funds, Inc. (“Xxxxxxx Funds”; together with the Church Fund and CSF, the “Funds”), a corporation organized under the laws of Maryland, CFS consulting services, LLC (“CFS”), a limited liability company organized under the laws of Texas, and Cipperman Compliance Services, LLC (“CCS”), a Pennsylvania limited liability company.
WHEREAS, the Funds are registered investment companies under the Investment Company Act of 1940, as amended (the “1940 Act”);
WHEREAS, the Funds are managed and/or advised by Capstone Asset Management Company (the “Adviser”), which is registered under the Investment Advisers Act of 1940, as amended;
WHEREAS, CFS, as administrator for the Funds, has responsibility for paying certain expenses of the Funds including compliance expenses;
WHEREAS, the Board of Directors of the Funds (the “Board”) is required to implement a compliance program pursuant to Rule 38a-1 (“Rule 38a-1”) of the 1940 Act including the designation of a chief compliance officer (the “CCO”);
WHEREAS, the Funds wish to engage CCS to provide certain compliance services on behalf of the Funds;
WHEREAS, CCS wishes to provide such services to the Funds under the conditions set forth below;
NOW, THEREFORE, in consideration of the premises and mutual covenants contained in this Agreement, the Funds and CCS agree to the Terms and Conditions described in Exhibits A-D.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the day and year first above written.
| CFS CONSULTING SERVICES, LLC | CIPPERMAN COMPLIANCE SERVICES, LLC | ||
| By | /s/ Xxxxxxx Xxxx | By | /s/ Xxxx Xxxxxxxxx |
| Name | Xxxxxxx Xxxx | Name | Xxxx Xxxxxxxxx |
| Title | President | Title | Managing Member |
| XXXXXXX FUNDS, INC. | |
| By | /s/ Xxxxxxx Xxxx |
| Name | Xxxxxxx Xxxx |
| Title | President |
| CAPSTONE SERIES FUND, INC. | |
| By | /s/ Xxxxxxx Xxxx |
| Name | Xxxxxxx Xxxx |
| Title | President |
| CAPSTONE CHURCH CAPITAL FUND | |
| By | /s/ Xxxxxxx Xxxx |
| Name | Xxxxxxx Xxxx |
| Title | President |
Exhibit A
Services
| 1. | Chief Compliance Officer. CCS will designate a member of our staff (acceptable to the Board) to serve as Chief Compliance Officer pursuant to Rule 38a-1. The CCO will be responsible for administering the Funds’ policies and procedures, reporting to the Board, providing the annual written compliance report, and any other matters required of a CCO under the Investment Company Act. |
| 2. | Policies and Procedures. CCS will proactively maintain and update the Funds’ compliance manual to reflect regulatory changes and changes to the Funds’ business. CCS will draft all policies and work with management and the Board to include all recommended revisions and changes. CCS will monitor the industry and regulatory developments and recommend changes to policies and procedures as appropriate. |
| 3. | Certifications. CCS will ensure that all relevant personnel and service providers receive and understand the compliance policies and procedures, obtain certifications with respect thereto, and obtain quarterly compliance certifications. |
| 4. | Annual Review. CCS will conduct the annual review of the adequacy and effectiveness of the policies and procedures of the Funds and the relevant service providers. Pursuant to Rule 38a-1(a)(4)(iii), the annual report will address (A) the operation of the policies and procedures of the fund and each investment adviser, principal underwriter, administrator, and transfer agent of the fund, any material changes made to those policies and procedures since the date of the last report, and any material changes to the policies and procedures recommended as a result of the annual review; and (B) each Material Compliance Matter (as defined in Rule 38a-1(e)(2)) that occurred since the date of the last report. The review will include a review of the policies and procedures, interviews of key personnel, obtaining certifications, conducting rolling site visits of service providers, reviewing internal and/or third party compliance and internal control reports, reviewing cited regulatory deficiencies and/or exam results, noting observed risks, and testing implementation. CCS will provide a detailed written report of our findings to the Board. |
| 5. | Compliance Calendar. CCS will create, implement, and follow a detailed compliance calendar and project plan to ensure the timely completion of all compliance activities by all relevant parties. |
| 6. | Advice, Guidance, and Support. CCS will provide unlimited real-time advice and guidance to management or the Board with respect to any compliance and regulatory question (that does not require research or a written response). |
| 7. | Board Reporting. A representative from CCS will attend all Board meetings and report material compliance issues to the Board. CCS will also review certifications of various service providers and make a series of written compliance certifications. |
| 8. | Privacy Notices. CCS will ensure the timely delivery of all privacy notices to shareholders. |
| 9. | Code of Ethics. CCS will manage all processes under the Funds’ Code of Ethics including obtaining certifications, cross-checking personal trading account records, and preclearing transactions. CCS will also recommend discipline where appropriate. |
| 10. | Marketing Materials. CCS will review all fund marketing materials for compliance with SEC rules (up to 20 hours per year). |
| 11. | Regulatory Exams. CCS will provide up to 20 hours of support related to responding to regulatory exams conducted by the SEC. This will include assembling materials in response to requests, interfacing with the exam staff, and preparing a written response to deficiencies. |
| 12. | Training. CCS will offer training sessions (up to 6 hours per year) on topics and to personnel designated by management or the Board. |
Exhibit B
Fees and Term
Fee for Base Services: $5,000/month
In the event that the Funds add additional sub-advisers (other than the initial Adviser), the Funds shall be charged a fee of $10,000 per year per sub-adviser.
In the event that the Funds engages CCS to conduct an initial review (which shall include a site visit) of an adviser (other than the Adviser) or a sub-adviser to assist the Board in determining whether its policies and procedures are reasonably designed to prevent violation of the Federal Securities Laws as described in Rule 38a-1(a)(2), the Funds shall pay a fixed fee of $5,000 for each such review and related report to the Board.
Hourly rate for additional services: $450/hour
Initial Term: 24 months
All fees shall be payable by CFS
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Exhibit D
Addenda
All references to the term “Trust” shall be replaced with “Funds” and related terms and context shall be amended accordingly.
Capstone Asset Management Compliance Officer: Xxxxxxxx XxXxxxx
Address for Notices:
Capstone Asset Management Company
0000 Xxxx Xxx Xxxxxxx Xxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx, XX 00000
Attn: Xxxxxxxx XxXxxxx
