Exhibit (h)(3)
FUND ACCOUNTING AGREEMENT
As amended December 1, 2004
AGREEMENT made this 13th day of February, 1998, between the Vintage
Mutual Funds, Inc., (the "Company"), a Maryland Corporation having its principal
place of business at 0000 Xxxxx Xxxxxx, Xxx Xxxxxx, Xxxx 00000-0000, and
Investors Management Group, ("IMG"), a corporation organized under the laws of
the State of Iowa and having its principal place of business at 0000 Xxxxx
Xxxxxx, Xxx Xxxxxx, Xxxx 00000-0000.
WHEREAS, the Company desire that IMG perform certain fund accounting
services for each investment portfolio of the Company identified on Schedule A
hereto, as such Schedule shall be amended from time to time (individually
referred to herein as the "Fund" and collectively as the "Funds"); and
WHEREAS, IMG 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:
1. SERVICES AS FUND ACCOUNTANT. IMG will keep and maintain the following
books and records of each Fund pursuant to Rule 31a-1 under the Investment
Company Act of 1940 (the "Rule"):
(a) Journals containing an itemized daily record in detail of all
purchases and sales of securities, all receipts and disbursements
of cash and all other debits and credits, as required by
subsection (b)(1) of the Rule;
(b) General and auxiliary ledgers reflecting all asset, liability,
reserve, capital, income and expense accounts, including interest
accrued and interest received, as required by subsection
(b)(2)(i) of the Rule;
(c) Separate ledger accounts required by subsection (b)(2)(ii) and
(iii) of the Rule; and
(d) A monthly trial balance of all ledger accounts (except
shareholder accounts) as required by subsection (b)(8) of the
Rule.
In addition to the maintenance of the books and records specified above,
IMG shall perform the following accounting services daily for each Fund:
(a) Calculate the net asset value per Share;
(b) Calculate the dividend and capital gain distribution, if any;
(c) Calculate the yield;
(d) Reconcile cash movements with the Fund's custodian;
(e) Affirm to the Fund's custodian all portfolio trades and cash
movements;
(f) Verify and reconcile with the Fund's custodian all daily trade
activity;
(g) Provide the following reports:
(i) A current security position report;
(ii) A summary report of transactions and pending maturities
(including the principal, cost, and accrued interest on
each portfolio security in maturity date order); and
(iii) A current cash position report (including cash available
from portfolio sales and maturities and sales of a Fund's
Shares less cash needed for redemptions and settlement of
portfolio purchased);
(h) Such other similar services with respect to a Fund as may be
reasonably requested by the Company.
IMG shall perform the following accounting services for each Fund:
(a) Obtain at least daily for variable net asset value funds and
weekly for money market funds actual dealer quotations, prices
from a pricing service, or matrix prices on all portfolio
securities (including those with less than 60 days to maturity)
in order to xxxx the entire portfolio to the market; and
(b) Prepare an interim balance sheet, statement of income and
expense, and statement of changes in net assets for the Fund as
of each month-end.
2. SUBCONTRACTING. IMG may, at its expense, subcontract with any entity
or person concerning the provision of the services contemplated hereunder;
provided, however, that IMG shall not be relieved of any of its obligations
under this Agreement by the appointment of such sub-contractor and provided
further, that IMG shall be responsible, to the extent provided in Section 7
hereof, for all acts of such sub-contractor as if such acts were its own.
3. COMPENSATION. The Company shall pay IMG for the services to be
provided by IMG under this Agreement in accordance with, and in the manner set
forth in, Schedule A hereto.
4. REIMBURSEMENT OF EXPENSES. In addition to paying IMG the fees
described in Section 3 hereof, the Company agrees to reimburse IMG for IMG's
out-of-pocket expenses in providing services hereunder, including without
limitation the following:
A. All freight and other deliver and bonding charges incurred by IMG
in delivering materials to and from the Company;
B. All direct telephone, telephone transmission and telecopy or
other electronic transmission expenses incurred by IMG in
communication with the Company, the Company's investment advisor
or custodian, dealers or others as required for IMG to perform
the services to be provided hereunder;
C. Costs of pricing the portfolio securities of each Fund;
D. The cost of microfilm or microfiche of records or other
materials; and
E. Any expenses IMG shall incur at the written direction of an
officer of the Company thereunto duly authorized.
5. EFFECTIVE DATE. This Agreement shall become effective with respect to
a Fund as of the date first written above (or, if a particular fund is not in
existence on that date, on the date an amendment to Schedule A to this Agreement
relating to the Fund is executed) ( the "Executed Date").
6. TERM. This Agreement shall continue in effect with respect to a Fund,
unless earlier terminated by either party hereto as provided hereunder, until
December 31, 2000 and thereafter shall be renewed automatically for successive
three year terms unless written notice not to renew is given by the non-renewing
party to the other party at least 60 days prior to the expiration of the then
current term, provided, however, that after such termination for so long as IMG,
with the written consent of the Company, in fact continues to perform any one or
more of the service 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 IMG and unpaid by the Company upon such termination
shall be immediately due and payable upon and notwithstanding such termination.
IMG shall be entitled to collect from the Company, in addition to the
compensation described under Section 3 hereof, the amount of all of IMG's cash
disbursements for services in connection with IMG's activities in effecting such
termination, including without limitation, the delivery to the Company and/or
its designees of the Company's property, records, instruments and documents, or
any copies thereof. Subsequent to such termination for a reasonable fee, IMG
will provide the Company with reasonable access to any Company documents or
records remaining in its possession. This Agreement is terminable with respect
to a particular Fund only upon mutual agreement of the parties hereto or for
"cause" (as defined below) by the party alleging "cause", in either case on not
less than 60 days' notice by the Company's Board of Directors or by IMG.
For purposes of this Agreement, "cause" shall mean (a) willful
misfeasance, bad faith, gross negligence or reckless disregard on the part of
the party to be terminated with respect to its obligations and duties set forth
herein; (b) 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; (c) financial difficulties
on the part of the party to be terminated which is 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 to the modification or alteration of the rights
of creditors; or (d) any circumstances which substantially impairs the
performance of the obligations and duties of the party to be terminated, or the
ability to perform those obligations and duties as contemplated herein.
If, for any reason other than "cause" as defined above, IMG is replace
as Fund Accountant, or if a third party is added to perform all or a part of the
services provided by IMG under this Agreement (excluding any sub-accountant
appointed by IMG as provided in Section 2 hereof), then the Company shall make a
one-time cash payment, as liquidated damages, to IMG equal to the balance due
IMG for the remainder of the term of this Agreement, assuming for purposes of
calculation of the payment that the asset level of the Company on the date IMG
is replaces, or a third party is added, will remain constant for the balance of
the contract term.
7. STANDARD OF CARE: RELIANCE ON RECORDS AND INSTRUCTION:
INDEMNIFICATION. IMG shall use its best efforts to insure the accuracy of all
services performed under this Agreement, but shall not be liable to the Company
for any action taken or omitted by IMG in the absence of bad faith, willful
misfeasance, negligence or from reckless disregard by it of its obligations and
duties. A Fund agrees to indemnify and hold harmless IMG, its employees, agents,
directors, officers and nominees from and against any and all claims, demands,
actions and suits, whether groundless or otherwise, and from and against any and
all judgments, liabilities, losses, damages, costs, charges, counsel fees and
other expenses of every nature and character arising out of or in any way
relating to IMG's actions taken or nonactions with respect to the performance of
services under this Agreement with respect to such Fund or based, if applicable,
upon reasonable reliance on information, records, instructions or requests with
respect to such Fund given or made to IMG by a duly authorized representative of
the Company; provided that this indemnification shall not apply to actions or
omissions of IMG in cases of its own bad faith, willful misfeasance, negligence
or from reckless disregard by it of its obligations and duties, and further
provided that prior to confessing any claim against it which may be the subject
of this indemnification, IMG shall give the Company written notice of and
reasonable opportunity to defend against said claim in its own name or in the
name of IMG.
8. RECORDS RETENTION AND CONFIDENTIALITY. IMG shall keep and maintain on
behalf of the Company all books and records which the Company and IMG are, 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
Investment Company Act of 1940, as amended (the "1940 Act"), relating to the
maintenance of books and records in connection with the services to be provided
hereunder. IMG further agrees that all such books and records shall be the
property of the Company and to make such books and records available for
inspection by the Company or by the Securities and Exchange Commission at
reasonable times and otherwise to keep confidential all books and records and
other information relative to the Company and its shareholders; except when
requested to divulge such information by duly-constituted authorities or court
process.
9. UNCONTROLLABLE EVENTS. IMG assumes no responsibilities hereunder, and
shall not be liable, for any damage, loss of data, delay or any other loss
whatsoever cause by events beyond its reasonable control.
10. REPORTS. IMG will furnish to the Company and to its properly
authorized auditors, investment advisors, examiners, distributors, dealers,
underwriters, salesmen, insurance companies and others designated by the Company
in writing, such reports and at such times as are prescribed pursuant to the
terms and the conditions of this Agreement to be provided or completed by IMG,
or as subsequently agreed upon by the parties pursuant to an amendment hereto.
The Company agrees to examine each such report or copy promptly and will report
or cause to be reported any errors or discrepancies therein no later than three
business days from the receipt thereof. In the event that errors or
discrepancies, except such errors and discrepancies as may not reasonably be
expected to be discovered by the recipient within three days after conducting a
diligent examination, are not so reports within the aforesaid period of time, a
report will for all purposes be accepted by and binding upon the Company and any
other recipient, and IMG shall have no liability for errors or discrepancies
therein and shall have no further responsibility with respect to such report
except to perform reasonable corrections of such errors and discrepancies within
a reasonable time after requested to do so by the Company.
11. RIGHTS OF OWNERSHIP. All computer programs and procedures developed
to perform services required to be provided by IMG under this Agreement are the
property of IMG. All records and other data except such computer programs and
procedures are the exclusive property of the Company and all such other records
and data will be furnished to the Company in appropriate form as soon as
practicable after termination of this Agreement for any reason.
12. RETURN OF RECORDS. IMG may at its option at any time, and shall
promptly upon the Company's demand, turn over to the Company and cease to retain
IMG's files, records and documents created and maintained by IMG pursuant to
this Agreement which are no longer needed by IMG in the performance of its
services or for its legal protection. If not so turned over to the Company, such
documents and records will be retained by IMG 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 Company unless the Company authorizes in writing the
destruction of such records and documents.
13. REPRESENTATIONS OF THE COMPANY. The Company certifies to IMG that:
(1) as of the close of business on the Effective Date, each Fund that is in
existence as of the Effective Date has authorized unlimited shares, and (2) this
Agreement has been duly authorized by the Company and, when executed and
delivered by the Company, will constitute a legal, valid and binding obligation
of the Company, enforceable against the Company, enforceable against the Company
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.
14. REPRESENTATIONS OF IMG. IMG represents and warrants that: (1) the
various procedures and systems which IMG has implemented with regard to
safeguarding from loss or damage attributable to fire, theft, or any other cause
of the records, and other data of the Company and IMG's records, data, equipment
facilities and other property used in the performance of its obligations
hereunder are adequate and that it will make such changes therein from time to
time as are required for the secure performance of its obligations hereunder,
and (2) this Agreement has been duly authorized by IMG and, when executed and
delivered by IMG, will constitute a legal, valid and binding obligation of IMG,
enforceable against IMG 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.
15. INSURANCE. IMG shall notify the Company should any of its insurance
coverage be canceled or reduced. Such notification shall include the date of
change and the reasons therefor. IMG shall notify the Company 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 Company
from time to time as may be appropriate of the total outstanding claims made by
IMG under its insurance coverage.
16. INFORMATION FURNISHED BY THE COMPANY AND FUNDS. The Company has
furnished to IMG the following:
A. Copies of the Articles of Incorporation of the Company and of any
amendments thereto, certified by the proper official of the State
in which the Articles has been filed.
B. Copies of the following documents:
1. The Company's By-Laws and any amendments thereto;
2. Certified copies of resolutions of the Board of Directors
covering the approval of this Agreement, authorization of
a specified officer of the Company to execute and deliver
this Agreement and authorization for specified officers of
the Company to instruct IMG thereunder.
C. A list of all the officers of the Company, together with specimen
signatures of those officers who are authorized to instruct IMG
in all matters.
D. Two copies of the following (if such documents are employed by the
Company):
1. Prospectuses and Statements of Additional Information for each
Fund.
17. INFORMATION FURNISHED BY IMG. IMG has furnished to the Company the
following:
A. IMG's Articles of Incorporation.
B. IMG's Code of Regulations and any amendments thereto.
C. Certified copies of actions of IMG covering the following matters:
1. Approval of this Agreement, and authorization of a
specified officer of IMG to execute and deliver this
Agreement;
2. Authorization of IMG to act as fund accountant for the
Company and to provide accounting services for the
Company.
18. AMENDMENTS TO DOCUMENTS. The Company shall furnish IMG written
copies of any amendments to, or changes in, any of the items referred to in
Section 16 hereof forthwith upon such amendments or changes becoming effective.
In addition, the Company agrees that no amendments will be made to the
Prospectuses or Statements of Additional Information of the Company which might
have the effect of changing the procedures employed by IMG in providing the
services agreed to hereunder or which amendment might effect the duties of IMG
hereunder unless the Company first obtains IMG's approval of such amendments or
changes.
19. COMPLIANCE WITH LAW. Except for the obligations of IMG set forth in
Section 8 hereof, the Company assumes full responsibility for the preparation,
contents and distribution of each Prospectus of the Company 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. IMG shall have no obligation to
take cognizance of any laws relating to the sale of the Company's shares. The
Company represents and warrants that no shares of the Company will be offered to
the public until the Company's registration statements under the Securities Act
and the 1940 Act has been declared or becomes effective.
20. NOTICES. 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: 0000 Xxxxx Xxxxxx, Xxx Xxxxxx, Xxxx
00000-0000, or at such other address as such party may from time to time specify
in writing to the other party pursuant to this Section.
21. HEADINGS. Paragraph headings in this Agreement are included for
conveniences only and are not to be used to construe or interpret this
Agreement.
22. ASSIGNMENT. This Agreement and the rights and duties hereunder shall
not be assignable with respect to a Fund by either of the parties hereto except
by the specific written consent of the other party.
23. GOVERNING LAW. This Agreement shall be governed by and provisions
shall be construed in accordance with the laws of the State of Iowa.
24. LIMITATION OF LIABILITY OF THE DIRECTORS AND SHAREHOLDERS. The names
"the Vintage Mutual Funds, Inc." and "Directors of the Vintage Mutual Funds,
Inc." refer respectively to the Company created and the Directors, as directors
but not individually or personally. The obligations of the Vintage Mutual Funds,
Inc., entered into in the name or on behalf thereof by any of the Directors,
representatives or agents are made not individually, but in such capacities, and
are not binding upon any of the Directors, Shareholders or representatives of
the Company personally, but bind only the assets of the Company, and all persons
dealing with any series of shares of the Company must look solely to the assets
of the Company belonging to such series for the enforcement of any claims
against the Company.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed all as of the day and year first above written.
Vintage Mutual Funds, Inc.
By: /s/
-----------------------------
Title:
-----------------------------
Investors Management Group, Ltd.
By: /s/
-----------------------------
Title:
-----------------------------
Schedule A to the
Fund Accounting Agreement
Between the Vintage Mutual Funds, Inc. and
Investors Management Group
NAME OF FUND COMPENSATION
------------ ------------
Institutional Money Market Fund Annual rate of three one-hundredths
of one percent (0.03%) of the
average daily net assets of such
Fund plus IMG's reasonable
out-of-pocket expenses incurred in
Government Assets Fund the performance of its services as
provided in Section 4 of the Fund
Accounting Agreement to which this
Schedule is attached.
Liquid Assets Fund
Municipal Assets Fund
Institutional Reserves Fund
Vintage Limited Term Bond Fund
Vintage Bond Fund
Vintage Municipal Bond Fund
Vintage Balanced Fund
Vintage Equity Fund
Vintage Growth Fund
Amended 12/1/04.
