Exhibit 13(ii)
ACCOUNTING SERVICES AGREEMENT
THIS AGREEMENT is made as of _____________, 2002 by and between
PROVIDENT INVESTMENT COUNSEL TWENTY FUND I a [Maryland corporation/
Massachusetts business trust] (the "Fund") and PFPC INC., a Massachusetts
corporation ("PFPC").
WITNESSETH:
WHEREAS, the Fund is registered as an open-end management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act");
and
WHEREAS, the Fund wishes to retain PFPC to provide accounting services, and
PFPC wishes to furnish such services to its investment portfolios listed on
Exhibit A attached hereto and made a part hereof and as such Exhibit A may be
amended from time to time (each, a "Portfolio"); and
NOW, THEREFORE in consideration of the premises and the mutual covenants
herein contained, and intending to be legally bound hereby the parties hereto
agree as follows:
1. DEFINITIONS AS USED IN THIS AGREEMENT.
(a) "1933 ACT" means the Securities Act of 1933, as amended.
(b) "1934 ACT" means the Securities Exchange Act of 1934, as amended.
(c) "AUTHORIZED PERSON" means any officer of the Fund and any other person
duly authorized by the Fund's Board of Directors or Trustees to give
Oral Instructions and Written Instructions on behalf of the Fund. An
Authorized Person's scope of Authority may be limited by setting forth
such limitation in a written document signed by both parties hereto.
(d) "CEA" means the Commodities Exchange Act, as amended.
(e) "CHANGE OF CONTROL" means a change in ownership or control (not
including transactions between wholly-owned direct or indirect
subsidiaries of a common parent) of 25%or more of the beneficial
ownership of the shares of common stock or shares of beneficial
interest of an entity or its parent(s).
(f) "ORAL INSTRUCTIONS" mean oral instructions received by PFPC from an
Authorized Person or from a person reasonably believed by PFPC to be
an Authorized Person. PFPC may, in its sole discretion in each
separate instance, consider and rely upon instructions it receives
from an Authorized Person via electronic mail as Oral Instructions.
(g) "SEC" means the Securities and Exchange Commission.
(h) "SECURITIES LAWS" mean the 1933 Act, the 1934 Act, the 1940 Act and
the CEA.
(i) "SHARES" mean the shares of beneficial interest of any series or class
of the Fund.
(j) "WRITTEN INSTRUCTIONS" mean (i) written instructions signed by an
Authorized Person and received by PFPC or (ii) trade instructions
transmitted (and received by PFPC) by means of an electronic
transaction reporting system access to which requires use of a
password or other authorized identifier. The instructions may be
delivered by hand, mail, tested telegram, cable, telex or facsimile
sending device.
2. APPOINTMENT. The Fund hereby appoints PFPC to provide accounting services
to each of the Portfolios in accordance with the terms set forth in this
Agreement. PFPC accepts such appointment and agrees to furnish such
services.
3. DELIVERY OF DOCUMENTS. The Fund has provided or, where applicable, will
provide PFPC with the following:
(a) at PFPC's request, certified or authenticated copies of the
resolutions of the Fund's Board of Directors or Trustees, approving
the appointment of PFPC or its affiliates to provide services to each
Portfolio and approving this Agreement;
(b) a copy of Fund's most recent effective registration statement;
(c) a copy of each Portfolio's advisory agreement or agreements;
(d) a copy of the distribution/underwriting agreement with respect to each
class of Shares representing an interest in a Portfolio;
(e) a copy of each additional administration agreement with respect to a
Portfolio;
(f) a copy of each distribution and/or shareholder servicing plan and
agreement made in respect of the Fund or a Portfolio; and
(g) copies (certified or authenticated, where applicable) of any and all
amendments or supplements to the foregoing.
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4. COMPLIANCE WITH GOVERNMENT RULES AND REGULATIONS. PFPC undertakes to comply
with all applicable requirements of the Securities Laws, and any laws,
rules and regulations of governmental authorities having jurisdiction with
respect to the duties to be performed by PFPC hereunder. Except as
specifically set forth herein, PFPC assumes no responsibility for such
compliance by the Fund or any other entity.
5. INSTRUCTIONS.
(a) Unless otherwise provided in this Agreement, PFPC shall act only upon
Oral Instructions or Written Instructions.
(b) PFPC shall be entitled to rely upon any Oral Instruction or Written
Instruction it receives from an Authorized Person (or from a person
reasonably believed by PFPC to be an Authorized Person) pursuant to
this Agreement. PFPC may assume that any Oral Instructions or Written
Instruction received hereunder is not in any way inconsistent with the
provisions of organizational documents or this Agreement or of any
vote, resolution or proceeding of the Fund's Board of Directors or
Trustees or of the Fund's shareholders, unless and until PFPC receives
Written Instructions to the contrary.
(c) The Fund agrees to forward to PFPC Written Instructions confirming
Oral Instructions so that PFPC receives the Written Instructions by
the close of business on the same day that such Oral Instructions are
received. The fact that such confirming Written Instructions are not
received by PFPC or differ from the Oral Instructions shall in no way
invalidate the transactions or enforceability of the transactions
authorized by the Oral Instructions or PFPC's ability to rely upon
such Oral Instructions.
6. RIGHT TO RECEIVE ADVICE.
(a) ADVICE OF THE FUND. If PFPC is in doubt as to any action it should or
should not take, PFPC may request directions or advice, including Oral
Instructions or Written Instructions, from the Fund.
(b) ADVICE OF COUNSEL. If PFPC shall be in doubt as to any question of law
pertaining to any action it should or should not take, PFPC may
request advice from counsel of its own choosing (who may be counsel
for the Fund, the Fund's investment adviser or PFPC, at the option of
PFPC).
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(c) CONFLICTING ADVICE. In the event of a conflict between directions,
advice or Oral Instructions or Written Instructions PFPC receives from
the Fund and the advice PFPC receives from counsel, PFPC may rely upon
and follow the advice of counsel.
(d) PROTECTION OF PFPC. PFPC shall be indemnified by the Fund and without
liability for any action PFPC takes or does not take in reliance upon
directions or advice or Oral Instructions or Written Instructions PFPC
receives from or on behalf of the Fund or from counsel and which PFPC
believes, in good faith, to be consistent with those directions or
advice and Oral Instructions or Written Instructions. Nothing in this
section shall be construed so as to impose an obligation upon PFPC (i)
to seek such directions or advice or Oral Instructions or Written
Instructions, or (ii) to act in accordance with such directions or
advice or Oral Instructions or Written Instructions.
7. RECORDS; VISITS. The books and records pertaining to the Fund and the
Portfolios which are in the possession or under the control of PFPC shall
be the property of the Fund. The Fund and Authorized Persons, shall have
access to such books and records at all times during PFPC's normal business
hours. Upon the reasonable request of the Fund, copies of any such books
and records shall be provided by PFPC to the Fund or to an Authorized
Person at the Fund's expense. PFPC shall keep the following records:
(a) all books and records with respect to the Fund's books of account;
(b) records of each Portfolio's securities transaction.
8. CONFIDENTIALITY. Each party shall keep confidential any information
relating to the other party's business ("Confidential Information").
Confidential Information shall include (a) any data or information that is
competitively sensitive material, and not generally known to the public,
including, but not limited to, information about product plans, marketing
strategies, finances, operations, customer relationships, customer
profiles, customer lists, sales estimates, business plans, and internal
performance results relating to the past, present or future business
activities of the Fund or PFPC, their respective subsidiaries and
affiliated companies and the customers, clients and suppliers of any of
them; (b) any scientific or technical information, design, process,
procedure, formula, or improvement that is commercially valuable and secret
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in the sense that its confidentiality affords the Fund or PFPC a
competitive advantage over its competitors; (c) all confidential or
proprietary concepts, documentation, reports, data, specifications,
computer software, source code, object code, flow charts, databases,
inventions, know-how, and trade secrets, whether or not patentable or
copyrightable; and (d) anything designated as confidential. Notwithstanding
the foregoing, information shall not be subject to such confidentiality
obligations if it: (a) is already known to the receiving party at the time
it is obtained; (b) is or becomes publicly known or available through no
wrongful act of the receiving party; (c) is rightfully received from a
third party who, to the best of the receiving party's knowledge, is not
under a duty of confidentiality; (d) is released by the protected party to
a third party without restriction; (e) is required to be disclosed by the
receiving party pursuant to a requirement of a court order, subpoena,
governmental or regulatory agency or law (provided the receiving party will
provide the other party written notice of such requirement, to the extent
such notice is permitted); (f) is relevant to the defense of any claim or
cause of action asserted against the receiving party; or (g) has been or is
independently developed or obtained by the receiving party.
9. LIAISON WITH ACCOUNTANTS. PFPC shall act as liaison with the Fund's
independent public accountants and shall provide account analyses, fiscal
year summaries, and other audit-related schedules with respect to each
Portfolio. PFPC shall take all reasonable action in the performance of its
duties under this Agreement to assure that the necessary information is
made available to such accountants for the expression of their opinion, as
required by the Fund.
10. PFPC SYSTEM. PFPC shall retain title to and ownership of any and all data
bases, computer programs, screen formats, report formats, interactive
design techniques, derivative works, inventions, discoveries, patentable or
copyrightable matters, concepts, expertise, patents, copyrights, trade
secrets, and other related legal rights utilized by PFPC in connection with
the services provided by PFPC to the Fund.
11. DISASTER RECOVERY. PFPC shall enter into and shall maintain in effect with
appropriate parties one or more agreements making reasonable provisions for
emergency use of electronic data processing equipment to the extent
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appropriate equipment is available. In the event of equipment failures,
PFPC shall, at no additional expense to the Fund, take reasonable steps to
minimize service interruptions. PFPC shall have no liability with respect
to the loss of data or service interruptions caused by equipment failure
provided such loss or interruption is not caused by PFPC's own willful
misfeasance, bad faith, gross negligence or reckless disregard of its
duties or obligations under this Agreement.
12. COMPENSATION. As compensation for services rendered by PFPC during the term
of this Agreement, the Fund, on behalf of each Portfolio, will pay to PFPC
a fee or fees as may be agreed to in writing by the Fund and PFPC.
13. INDEMNIFICATION. The Fund, on behalf of each Portfolio, agrees to
indemnify, defend and hold harmless PFPC and its affiliates, including
their respective officers, directors, agents and employees from all taxes,
charges, expenses, assessments, claims and liabilities (including, without
limitation, attorneys' fees and disbursements and liabilities arising under
the Securities Laws and any state and foreign securities and blue sky laws)
arising directly or indirectly from any action or omission to act which
PFPC takes in connection with the provision of services to the Fund.
Neither PFPC, nor any of its affiliates, shall be indemnified against any
liability (or any expenses incident to such liability) caused by PFPC's or
its affiliates' own willful misfeasance, bad faith, gross negligence or
reckless disregard in the performance of PFPC's activities under this
Agreement. Any amounts payable by the Fund hereunder shall be satisfied
only against the relevant Portfolio's assets and not against the assets of
any other investment portfolio of the Fund. The provisions of this Section
13 shall survive termination of this Agreement.
14. RESPONSIBILITY OF PFPC.
(a) PFPC shall be under no duty hereunder to take any action on behalf of
the Fund or any Portfolio except as specifically set forth herein or
as may be specifically agreed to by PFPC and the Fund in a written
amendment hereto. PFPC shall be obligated to exercise care and
diligence in the performance of its duties hereunder and to act in
good faith in performing services provided for under this Agreement.
PFPC shall be liable only for any damages arising out of PFPC's
failure to perform its duties under this Agreement to the extent such
damages arise out of PFPC's willful misfeasance, bad faith, gross
negligence or reckless disregard of such duties.
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(b) Notwithstanding anything in this Agreement to the contrary, (i) PFPC
shall not be liable for losses, delays, failure, errors, interruption
or loss of data occurring directly or indirectly by reason of
circumstances beyond its reasonable control, including without
limitation acts of God; action or inaction of civil or military
authority; public enemy; war; terrorism; riot; fire; flood; sabotage;
epidemics; interruption; loss or malfunction of utilities,
transportation, computer or communications capabilities; insurrection;
elements of nature; or non-performance by a third party and (ii) PFPC
shall not be under any duty or obligation to inquire into and shall
not be liable for the validity or invalidity, authority or lack
thereof, or truthfulness or accuracy or lack thereof, of any
instruction, direction, notice, instrument or other information which
PFPC reasonably believes to be genuine.
(c) Notwithstanding anything in this Agreement to the contrary, (i)
neither PFPC nor its affiliates shall be liable for any consequential,
special or indirect losses or damages, whether or not the likelihood
of such losses or damages was known by PFPC or its affiliates and (ii)
PFPC's cumulative liability to the Fund for all losses, claims, suits,
controversies, breaches or damages for any cause whatsoever (including
but not limited to those arising out of or related to this Agreement)
and regardless of the form of action or legal theory shall not exceed
the lesser of [$100,000] or the fees received by PFPC for services
provided hereunder during the 12 months immediately prior to the date
of such loss or damage.
(d) No party may assert a cause of action against PFPC or any of its
affiliates that allegedly occurred more than 12 months immediately
prior to the filing of the suit (or, if applicable, commencement of
arbitration proceedings) alleging such cause of action.
(e) Each party shall have a duty to mitigate damages for which the other
party may become responsible.
(f) The provisions of this Section 14 shall survive termination of this
Agreement.
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15. DESCRIPTION OF ACCOUNTING SERVICES ON A CONTINUOUS BASIS. PFPC will perform
the following accounting services with respect to each Portfolio:
(i) Journalize investment, capital share and income and expense
activities;
(ii) Verify investment buy/sell trade tickets when received from the
investment adviser for a Portfolio (the "Adviser") and transmit
trades to the Fund's custodian (the "Custodian") for proper
settlement;
(iii) Maintain individual ledgers for investment securities;
(iv) Maintain historical tax lots for each security;
(v) Reconcile cash and investment balances with the Custodian, and
provide the Adviser with the beginning cash balance available for
investment purposes;
(vi) Update the cash availability throughout the day as required by the
Adviser;
(vii) Post to and prepare the Statement of Assets and Liabilities and the
Statement of Operations;
(viii) Calculate various contractual expenses (e.g., advisory and custody
fees);
(ix) Monitor the expense accruals and notify an officer of the Fund of
any proposed adjustments;
(x) Control all disbursements and authorize such disbursements upon
Written Instructions;
(xi) Calculate capital gains and losses;
(xii) Determine net income;
(xiii) Obtain security market quotes from independent pricing services
approved by the Adviser, or if such quotes are unavailable, then
obtain such prices from the Adviser, and in either case calculate
the market value of each Portfolio's Investments;
(xiv) Transmit or mail a copy of the daily portfolio valuation to the
Adviser;
(xv) Compute net asset value;
(xvi) As appropriate, compute yields, total return, expense ratios,
portfolio turnover rate, and, if required, portfolio average
dollar-weighted maturity; and
(xvii) Prepare a monthly financial statement, which will include the
following items:
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Schedule of Investments
Statement of Assets and Liabilities
Statement of Operations
Statement of Changes in Net Assets
Cash Statement
Schedule of Capital Gains and Losses.
16. DURATION AND TERMINATION. This Agreement shall continue until terminated by
the Fund or by PFPC on sixty (60) days' prior written notice to the other
party. In the event the Fund gives notice of termination, all expenses
associated with movement (or duplication) of records and materials and
conversion thereof to a successor accounting services agent(s) (and any
other service provider(s)), and all trailing expenses incurred by PFPC,
will be borne by the Fund.
17. CHANGE OF CONTROL. Notwithstanding any other provisions of this Agreement,
in the event of an agreement to enter into a transaction that would result
in a Change of Control of the Fund's adviser or sponsor, the Fund's ability
to terminate the Agreement pursuant to Section 16 will be suspended from
the time of such agreement until two years after the Change of Control.
18. NOTICES. Notices shall be addressed (a) if to PFPC, at 000 Xxxxxxxx
Xxxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000, Attention: President; (b) if to the
Fund, at , Attention: or (c) if to neither of the foregoing, at such other
address as shall have been given by like notice to the sender of any such
notice or other communication by the other party. If notice is sent by
confirming telegram, cable, telex or facsimile sending device, it shall be
deemed to have been given immediately. If notice is sent by first-class
mail, it shall be deemed to have been given three days after it has been
mailed. If notice is sent by messenger, it shall be deemed to have been
given on the day it is delivered.
19. AMENDMENTS. This Agreement, or any term thereof, may be changed or waived
only by written amendment, signed by the party against whom enforcement of
such change or waiver is sought.
20. DELEGATION; ASSIGNMENT. PFPC may assign its rights and delegate its duties
hereunder to any majority-owned direct or indirect subsidiary of PFPC or of
The PNC Financial Services Group, Inc., provided that PFPC gives the Fund
thirty (30) days' prior written notice of such assignment or delegation.
21. COUNTERPARTS. This Agreement may be executed in two or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
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22. FURTHER ACTIONS. Each party agrees to perform such further acts and execute
such further documents as are necessary to effectuate the purposes hereof.
23. MISCELLANEOUS.
(a) Notwithstanding anything in this Agreement to the contrary, the Fund
agrees not to make any modifications to its registration statement or
adopt any policies which would affect materially the obligations or
responsibilities of PFPC hereunder without the prior written approval
of PFPC, which approval shall not be unreasonably withheld or delayed.
(b) Except as expressly provided in this Agreement, PFPC hereby disclaims
all representations and warranties, express or implied, made to the
Fund or any other person, including, without limitation, any
warranties regarding quality, suitability, merchantability, fitness
for a particular purpose or otherwise (irrespective of any course of
dealing, custom or usage of trade), of any services or any goods
provided incidental to services provided under this Agreement. PFPC
disclaims any warranty of title or non-infringement except as
otherwise set forth in this Agreement.
(c) This Agreement embodies the entire agreement and understanding between
the parties and supersedes all prior agreements and understandings
relating to the subject matter hereof, provided that the parties may
embody in one or more separate documents their agreement, if any, with
respect to delegated duties. The captions in this Agreement are
included for convenience of reference only and in no way define or
delimit any of the provisions hereof or otherwise affect their
construction or effect. Notwithstanding any provision hereof, the
services of PFPC are not, nor shall they be, construed as constituting
legal advice or the provision of legal services for or on behalf of
the Fund or any other person.
(d) This Agreement shall be deemed to be a contract made in Delaware and
governed by Delaware law, without regard to principles of conflicts of
law.
(e) If any provision of this Agreement shall be held or made invalid by a
court decision, statute, rule or otherwise, the remainder of this
Agreement shall not be affected thereby. This Agreement shall be
binding upon and shall inure to the benefit of the parties hereto and
their respective successors and permitted assigns.
(f) The facsimile signature of any party to this Agreement shall
constitute the valid and binding execution hereof by such party.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and year first above written.
PFPC INC.
By:
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Title:
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PROVIDENT INVESTMENT COUNSEL TWENTY FUND I
By:
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Title:
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BUSINESS APPROVAL BY:_________________
Date:_________________________________
Legal Approval By:____________________
Date:_________________________________
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EXHIBIT A
PORTFOLIOS
THIS EXHIBIT A, dated as of , 2002, is Exhibit A to that certain Accounting
Services Agreement dated as of , 2002 between PFPC Inc. and Provident Investment
Counsel Twenty Fund I. This Exhibit A shall supercede all previous forms of
Exhibit A.
[LIST PORTFOLIOS]
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AUTHORIZED PERSONS APPENDIX
NAME (TYPE) SIGNATURE
________________________
________________________
________________________
________________________
________________________
________________________
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