FUND ACCOUNTING AGREEMENT
THIS FUND ACCOUNTING AGREEMENT is made as of this 31st day of December, 2014, by and among Hartford Funds Management Company, LLC (the “Fund Accountant”), a Delaware limited liability company, and each of The Hartford Mutual Funds, Inc., The Hartford Mutual Funds II, Inc., Hartford Series Fund, Inc., and Hartford HLS Series Fund II, Inc., on behalf of their respective series listed on Schedule A, and The Hartford Alternative Strategies Fund (together with the series listed on Schedule A, the “Funds”). This Agreement is intended to take effect as if entered into between each Fund, severally, and the Fund Accountant and the provisions of this Agreement shall be construed accordingly.
WHEREAS, the Funds are comprised of one or more management investment companies registered under the Investment Company Act of 1940, as amended, (the “1940 Act”) and are currently offering shares of common stock (such shares, of all series and classes, are hereinafter called the “Shares”); and
WHEREAS, the Funds desire to appoint the Fund Accountant perform certain accounting services for each Fund that are not provided for under the Funds’ investment management agreements or any other agreement between the Funds, their investment manager, Hartford Funds Administrative Services Company or any third-party service provider, and the Fund Accountant desires to accept such appointment; and
WHEREAS, the Fund Accountant is prepared to perform such services on the terms and conditions set forth in this Agreement,
NOW, THEREFORE, in consideration of the mutual promises and covenants set forth herein, and intending to be legally bound hereby, the parties agree as follows:
1. TERMS OF APPOINTMENT
Subject to the terms and conditions set forth in this Agreement, the Funds hereby employ and appoint the Fund Accountant to act as, and the Fund Accountant agrees to act as, accounting services provider for each of the Funds.
The Funds hereby acknowledge and agree that the Fund Accountant may employ and appoint one or more affiliated or unaffiliated service providers (each, a “Delegate”) to act as sub-agent to perform one or more of the fund accounting services (the “Services”) described in Section 2 of this Agreement. In no event, however, will the appointment of a Delegate affect the obligations of the Fund Accountant under this Agreement; and to the extent any Service is delegated to a Delegate, the Fund Accountant will remain responsible to the Funds under this Agreement for the delivery of that Service by the Delegate, and for oversight of Delegate in the performance of the Service.
2. SERVICES AS FUND ACCOUNTANT
(a) Maintenance of Books and Records
The Fund Accountant will keep and maintain the following books and records of each Fund pursuant to Rule 31a-1 under the 1940 Act (the “Rule”):
(i) 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;
(ii) 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;
(iii) Separate ledger accounts required by subsection (b)(2)(ii) and (iii) of the Rule; and
(iv) A monthly trial balance of all ledger accounts (except shareholder accounts) as required by subsection (b)(8) of the Rule.
(b) Performance of Daily Accounting Services
The Fund Accountant will provide such fund accounting services as the Funds may reasonably request, including:
(i) Daily pricing of portfolio securities and computing the net asset value and the net income of the Funds in accordance with the Funds’ prospectuses and statements of additional information;
(ii) Calculating the dividend and capital gain distributions (including that needed to avoid all Federal excise taxes) and dividend factors, if any;
(iii) Verifying and reconciling each Fund’s daily trade activity with the Fund’s sub-adviser on a daily basis and the Funds’ custodian on a weekly basis and on each month end;
(iv) Calculating yields, effective yields, weighted average portfolio maturity, and total returns, as applicable, on all applicable Funds and all classes thereof and such other measure(s) of performance as may be reasonably requested by the Funds;
(v) Reviewing daily the net asset value calculation and dividend factor, if any, for each Fund prior to release to shareholders, checking and confirming the net asset values and dividend factors for reasonableness and deviations, and distributing net asset values and yields to NASDAQ;
(vi) Determining unrealized appreciation and depreciation on securities held in variable net asset value Funds;
(vii) Amortizing premiums and accreting discounts on securities purchased at a price other than face value, if requested by a Fund;
(viii) Posting Fund transactions to appropriate categories;
(ix) Accruing all necessary and appropriate expenses of each Fund;
(x) Determining the outstanding receivables and payables for all (1) security trades, (2) Fund share transactions, and (3) income and expense accounts;
(xi) Preparing the following reports: (1) a current security position report; (2) a summary report of transactions and pending maturities (including the principal, cost, and accrued interest on each portfolio security in maturity date order); (3) 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 purchases); (4) a statement of assets and liabilities; (5) a statement of operations; (6) a statement of changes in net assets; (7) periodic reports to a Fund’s shareholders and the U.S. Securities and Exchange
Commission (“SEC”); and (8) such other reports as may be reasonably requested by the Funds from time to time, including with respect to information typically supplied in the investment company industry to companies that track or report the price, performance or other information with respect to investment companies; and
(c) Other Services
The Fund Accountant will provide the following services as may be reasonably requested by the Funds:
(i) Conducting ongoing monitoring of services provided and service levels maintained by Delegates, including review of financial statements and other documents produced by such Delegates;
(ii) Conducting annual due diligence and compliance reviews of any Delegate and the services provided by such Delegate;
(iii) Providing the Funds with such assistance as may be necessary in pricing portfolio securities, including assisting in determining the fair value of any securities for which market values are not readily available;
(iv) Conducting ongoing monitoring of third party pricing vendors used to value Fund portfolio securities;
(v) Providing ongoing compliance review and testing of accounting services provided by any Delegate;
(vi) Maintaining and preserving, as applicable, the records specified in the Fund agreements not maintained by other fund service providers and any other records related to the Funds’ transactions as are required under any applicable state or federal securities;
(vii) Reviewing the appropriateness of and arranging for payment of each Fund’s expenses;
(viii) Reviewing and confirming the accuracy of the calculations of fees paid to the Funds’ service providers;
(ix) Providing such assistance to the Funds, the Delegates, the Funds’ Custodian and the the Funds’ counsel and auditors as generally may be required to properly carry on the business and operations of the Funds; and
(x) Providing to the Boards of Directors/Trustees (the “Board”) of the Funds such information regarding any Delegate and the Services as may be reasonably requested by the Board.
(d) The Fund Accountant shall provide such other similar services with respect to a Fund as may be reasonably requested by the Funds.
3. COMPENSATION
For the Services provided under this Agreement, the Funds shall pay the Fund Accountant a fee calculated at the applicable annual rate set forth on Schedule B hereto. Net asset value shall be computed at least once a day, as set forth in the Funds’ prospectuses. Upon any termination of this Agreement
before the end of any month, the fee for such part of a month shall be payable upon the date of termination of this Agreement.
The Fund Accountant will from time to time employ or associate with such person or persons, including any Delegate, as the Fund Accountant may believe to be appropriate to assist it in the performance of this Agreement. Such person or persons may be officers, or employees who are employed by both the Fund Accountant and the Funds. The compensation of such person or persons, including any Delegate, shall be paid by the Fund Accountant and no obligation may be incurred on behalf of the Funds in such respect. Other expenses to be incurred in the operation of the Funds, including taxes, interest, brokerage fees and commissions, if any, fees of directors/trustees who are not officers, directors, shareholders or employees of the Fund Accountant or the investment adviser or distributor for the Funds, SEC fees and state blue sky qualification fees, advisory and administration fees, transfer and dividend disbursing agents’ fees, insurance premiums with respect to insurance obtained for the Funds, auditing and legal expenses, costs of maintenance of corporate existence, typesetting and printing prospectuses for regulatory purposes and for distribution to current shareholders of the Funds, costs of shareholders’ reports and meetings and any extraordinary expenses will be borne by the Funds, except as may otherwise be agreed between the Funds and the Fund Accountant.
4. CONFIDENTIALITY
The Fund Accountant agrees to treat confidentially and as the proprietary information of the Funds all records and other information relative to the Funds and prior, present, or potential shareholders, and not to use such records and information for any purpose other than performance of its responsibilities and duties hereunder, except after prior notification to and approval in writing by the Funds, which approval shall not be unreasonably withheld and may not be withheld where the Fund Accountant may be exposed to civil or criminal contempt proceedings for failure to comply, when requested to divulge such information by duly constituted authorities, or when so requested by the Funds.
5. INDEMNIFICATION
The Fund Accountant shall use its best efforts to ensure the accuracy of all services performed under this Agreement, but shall not be liable to the Funds for any action taken or omitted by the Fund Accountant in the absence of bad faith, willful misfeasance or negligence. The Fund Accountant assumes no responsibility hereunder, and shall not be liable, for any damage, loss of data, delay, or any other loss whatsoever caused by events beyond its reasonable control.
Any person, even though also an employee or agent of the Fund Accountant, who may be or become an officer, trustee, employee, or agent of the Funds shall be deemed, when rendering services to the Funds, or acting on any business of that party, to be rendering such services to or acting solely for that party and not as an employee, or agent or one under the control or direction of the Fund Accountant even though paid by them.
The Funds agree to indemnify and hold the Fund Accountant harmless from all taxes, charges, expenses, assessments, claims and liabilities (including, without limitation, liabilities arising under the Securities Act of 1933, the Securities Exchange Act of 1934, the 1940 Act, and any state and foreign securities and blue sky laws, all as amended from time to time) and expenses, including (without limitation) attorneys’ fees and disbursements arising directly or indirectly from any action or thing which the Fund Accountant takes or does or omits to take or do hereunder, provided that the Fund Accountant shall not be indemnified against any liability to the Funds or to their shareholders (or any expenses incident to such liability) arising out of the Fund Accountant’s negligent failure to perform its duties under this Agreement. For clarification, to the extent any obligation to provide indemnification under this Section 4 arises in respect of any Fund, the obligation so to indemnify shall be the obligation of each such Fund, and no other Fund.
6. TERM
This Agreement shall become effective on December 31, 2014 and may be terminated upon at least sixty (60) days’ written notice to the other party.
7. NOTICES
All notices and other communications (collectively referred to as a “Notice” or “Notices” in this paragraph) hereunder shall be in writing or by telegram, cable, telex or facsimile sending device. Notices shall be addressed (a) if to the Fund Accountant, at its address, 0 Xxxxxx Xxxxxxxxx Xxxxxx, Xxxxx 000, 100 Matsonford Road, Radnor, Pennsylvania 19087, Attn: Fund Accounting; (b) if to the Funds, at their principal place of business or (c) if to neither of the foregoing, at such other address as to which the sender shall have been notified by any such Notice or other communication. The Notice may be sent by first-class mail, in which case it shall be deemed to have been given three days after it is sent, or if sent by confirming electronic mail or facsimile sending device, it shall be deemed to have been given immediately.
8. FURTHER ACTIONS
Each party agrees to perform or cause to be performed such further acts and execute such further documents as are necessary to effectuate the purposes hereof.
9. 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 which, in the case of assignment to an affiliate, shall not be unreasonably denied.
10. AMENDMENTS
This Agreement or any part hereof may be changed or waived only by an instrument in writing signed by the party against which enforcement of such change or waiver is sought.
11. GOVERNING STATE LAW
This Agreement shall be governed by and its provisions shall be construed in accordance with the laws of the State of New York without reference to the conflicts of laws provisions of the law of the State of New York.
12. MISCELLANEOUS
This Agreement embodies the entire agreement and understanding between the parties hereto, and supersedes all prior agreements and understandings relating to the subject matter hereof. 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. 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 and shall inure to the benefit of the parties hereto and their respective successors.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed all as of the date first above written.
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The Hartford Mutual Funds, Inc. | |
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By: |
/s/ Xxxxx Xxxxx |
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Xxxxx Xxxxx |
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Vice President |
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The Hartford Mutual Funds II, Inc. | |
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By: |
/s/ Xxxxx Xxxxx |
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Xxxxx Xxxxx |
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Vice President |
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Hartford Series Fund, Inc. | |
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By: |
/s/ Xxxxx Xxxxx |
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Xxxxx Xxxxx |
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Vice President |
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Hartford HLS Series Fund II, Inc. | |
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By: |
/s/ Xxxxx Xxxxx |
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Xxxxx Xxxxx |
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Vice President |
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The Hartford Alternative Strategies Fund | |
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By: |
/s/ Xxxxx Xxxxx |
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Xxxxx Xxxxx |
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Vice President |
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Hartford Funds Management Company, LLC | |
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By: |
/s/ Xxxxxxx X. Xxxxx |
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Xxxxxxx X. Xxxxx |
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Chief Financial Officer |
SCHEDULE A
To the Fund Accounting Agreement
THE HARTFORD MUTUAL FUNDS, INC.
The Hartford Balanced Fund
The Hartford Balanced Income Fund
The Hartford Capital Appreciation Fund
The Hartford Checks and Balances Fund
The Hartford Conservative Allocation Fund
The Hartford Disciplined Equity Fund
The Hartford Dividend and Growth Fund
Hartford Duration-Hedged Strategic Income Fund
The Hartford Emerging Markets Local Debt Fund
The Hartford Emerging Markets Research Fund
The Hartford Equity Income Fund
The Hartford Floating Rate Fund
The Hartford Floating Rate High Income Fund
The Hartford Global All-Asset Fund
The Hartford Global Alpha Fund
Hartford Global Capital Appreciation Fund
Hartford Global Equity Income Fund
The Hartford Global Real Asset Fund
The Hartford Growth Allocation Fund
The Hartford Healthcare Fund
The Hartford High Yield Fund
The Hartford Inflation Plus Fund
Hartford International Capital Appreciation Fund
The Hartford International Growth Fund
The Hartford International Opportunities Fund
The Hartford International Small Company Fund
The Hartford International Value Fund
Hartford Long/Short Global Equity Income Fund
The Hartford MidCap Fund
The Hartford MidCap Value Fund
Hartford Moderate Allocation Fund
Hartford Multi-Asset Income Fund
The Hartford Municipal Opportunities Fund
The Hartford Quality Bond Fund
Hartford Real Total Return Fund
The Hartford Short Duration Fund
The Hartford Small Company Fund
The Hartford Small/Mid Cap Equity Fund
The Hartford Strategic Income Fund
The Hartford Total Return Bond Fund
The Hartford Unconstrained Bond Fund
The Hartford World Bond Fund
THE HARTFORD MUTUAL FUNDS II, INC.
The Hartford Growth Opportunities Fund
The Hartford Municipal Real Return Fund
The Hartford SmallCap Growth Fund
The Hartford Value Opportunities Fund
THE HARTFORD ALTERNATIVE STRATEGIES FUND
HARTFORD SERIES FUND, INC.
Hartford Balanced HLS Fund
Hartford Capital Appreciation HLS Fund
Hartford Disciplined Equity HLS Fund
Hartford Dividend and Growth HLS Fund
Hartford Global Growth HLS Fund
Hartford Healthcare HLS Fund
Hartford High Yield HLS Fund
Hartford International Opportunities HLS Fund
Hartford MidCap HLS Fund
Hartford MidCap Value HLS Fund
Hartford Small Company HLS Fund
Hartford Stock HLS Fund
Hartford Total Return Bond HLS Fund
Hartford Ultrashort Bond HLS Fund
Hartford Value HLS Fund
HARTFORD HLS SERIES FUND II, INC.
Hartford Growth Opportunities HLS Fund
Hartford SmallCap Growth HLS Fund
Hartford Small/Mid Cap Equity HLS Fund
Hartford U.S. Government Securities HLS Fund
HARTFORD CAYMAN FUNDS
The Hartford Cayman Global All-Asset Fund Ltd.
The Hartford Cayman Global Real Asset Fund Ltd.
SCHEDULE B
To the Fund Accounting Agreement
MUTUAL FUND ACCOUNTING FEES
Annual fee calculated at the following annual rates based on the average daily Fund net assets:
The Hartford Emerging Markets Local Debt Fund, The Hartford Emerging Markets Research Fund, The Hartford Global All-Asset Fund, The Hartford Global Alpha Fund, The Hartford Global Real Asset Fund, Hartford Long/Short Global Equity Income Fund, Hartford Real Total Return Fund and The Hartford Unconstrained Bond Fund
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Average Daily Net Assets |
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Annual Fee |
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On First $5 billion |
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0.025 |
% |
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On Next $5 billion |
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0.020 |
% |
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Over $10 billion |
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0.015 |
% |
The Hartford Alternative Strategies Fund, The Hartford Balanced Income Fund, The Hartford High Yield Fund, Hartford International Capital Appreciation Fund (formerly known as The Hartford Diversified International Fund), The Hartford International Growth Fund, Hartford Multi-Asset Income Fund, The Hartford Short Duration Fund, The Hartford Strategic Income Fund, The Hartford Total Return Bond Fund, The Hartford World Bond Fund, Hartford High Yield HLS Fund and Hartford Total Return Bond HLS Fund
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Average Daily Net Assets |
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Annual Fee |
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On First $5 billion |
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0.020 |
% |
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On Next $5 billion |
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0.015 |
% |
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Over $10 billion |
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0.010 |
% |
The Hartford Balanced Fund, The Hartford Capital Appreciation Fund, The Hartford Floating Rate Fund, The Hartford Floating Rate High Income Fund, Hartford Global Equity Income Fund (formerly The Hartford Global Research Fund), The Hartford International Opportunities Fund, The Hartford International Small Company Fund, The Hartford International Value Fund, The Hartford Municipal Opportunities Fund and Hartford Capital Appreciation HLS Fund
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Average Daily Net Assets |
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Annual Fee |
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On First $5 billion |
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0.018 |
% |
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On Next $5 billion |
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0.014 |
% |
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Over $10 billion |
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0.010 |
% |
The Hartford Disciplined Equity Fund, The Hartford Municipal Real Return Fund, The Hartford SmallCap Growth Fund, Hartford Balanced HLS Fund and Hartford International Opportunities HLS Fund
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Average Daily Net Assets |
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Annual Fee |
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On First $5 billion |
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0.016 |
% |
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On Next $5 billion |
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0.013 |
% |
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Over $10 billion |
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0.010 |
% |
The Hartford Dividend and Growth Fund, Hartford Duration-Hedged Strategic Income Fund, Hartford Global Capital Appreciation Fund (formerly known as The Hartford Capital Appreciation II Fund), The Hartford Healthcare Fund, The Hartford Inflation Plus Fund, The Hartford MidCap Value Fund, The Hartford Quality Bond Fund, The Hartford Small Company Fund, The Hartford Small/Mid Cap Equity Fund, The Hartford Value Opportunities Fund, Hartford Global Growth HLS Fund and Hartford Small/Mid Cap Equity HLS Fund
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Average Daily Net Assets |
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Annual Fee |
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On First $5 billion |
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0.014 |
% |
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On Next $5 billion |
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0.012 |
% |
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Over $10 billion |
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0.010 |
% |
The Hartford Checks and Balances Fund, The Hartford Conservative Allocation Fund, The Hartford Equity Income Fund, The Hartford Growth Allocation Fund, The Hartford Growth Opportunities Fund, The Hartford MidCap Fund, Hartford Moderate Allocation Fund (formerly The Hartford Balanced Allocation Fund), Hartford Dividend and Growth HLS Fund, Hartford Disciplined Equity HLS Fund, Hartford Small Company HLS Fund, Hartford SmallCap Growth HLS Fund, and Hartford U.S. Government Securities HLS Fund
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Average Daily Net Assets |
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Annual Fee |
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On First $5 billion |
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0.012 |
% |
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Over $5 billion |
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0.010 |
% |
Hartford Growth Opportunities HLS Fund, Hartford Healthcare HLS Fund, Hartford MidCap HLS Fund, Hartford MidCap Value HLS Fund, Hartford Stock HLS Fund, Hartford Ultrashort Bond HLS Fund, Hartford Value HLS Fund,
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Average Daily Net Assets |
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Annual Fee |
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All Assets |
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0.010 |
% |
