EXHIBIT 99.(h)(5)
ACCOUNTING SERVICES AGREEMENT
THIS AGREEMENT is made effective as of the 1st day of September, 2000,
by and between TD Waterhouse Investor Services, Inc., ("Customer"), as
administrator of the accounts listed on Schedule A hereto (each a "Portfolio",
and collectively, the "Portfolios"), as such Schedule may be amended from time
to time, and SEI Investments Mutual Funds Services, a Delaware business trust
("SEI").
WHEREAS, Customer desires SEI to provide, and SEI is willing to provide
fund accounting and related portfolio accounting services with respect to the
Portfolios listed on Schedule A, on the terms and conditions hereinafter set
forth;
NOW, THEREFORE, in consideration of the premises and the covenants
hereinafter contained, Customer and SEI hereby agree as follows:
ARTICLE 1. RETENTION OF SEI. Customer hereby retains SEI to act as the
fund accounting agent with respect to the Portfolios and to furnish the services
set forth in Article 2 below. SEI hereby accepts such employment to perform the
duties set forth below. SEI shall, for all purposes herein, be deemed to be an
independent contractor and, unless otherwise expressly provided or authorized,
shall have no authority to act for or represent Customer in any way and shall
not be deemed an agent of Customer.
ARTICLE 2. ACCOUNTING SERVICES. SEI shall perform, or supervise the
performance by others of fund accounting services as set forth herein in
connection with the operations of the Subject Portfolios. SEI may appoint and
compensate from its resources one or more other entities to perform such
services on a subcontracted basis in connection with the operations of the
Portfolios. If SEI appoints one or more other entities to perform services
called for by this Agreement on a subcontracted basis as aforesaid, SEI
nevertheless shall remain principally liable to Customer for the acts and
omissions of such other entities without regard to any rights or recourse SEI
may have against any third party.
SEI shall provide Customer with fund accounting and related portfolio
accounting services, all necessary office space, equipment, personnel,
compensation and facilities for handling the accounting affairs of the
Portfolios as are set forth on Schedule B hereto, and as amended by agreement of
the parties from time to time. In addition, at the request of Customer, SEI
shall make reports to Customer concerning the performance of its obligations
under this Agreement.
In connection with this Agreement, Customer will furnish SEI with
copies, properly certified or authenticated, of the governing documents for each
of the Portfolios and such other documents as may be reasonably necessary to the
performance by SEI of the services set forth in this Agreement. Customer agrees
to furnish SEI with any amendments or supplements to such documents.
With respect to all non-money market Portfolios, Customer agrees that
it will implement an automated trade ticket transmission ("TradeNet") and
automated daily custody security position reconciliation ("Automated
Reconciliation Review") with SEI's fund accounting systems to facilitate the
timely and accurate calculation of Portfolio net asset values. To the extent it
becomes practicable in the future based on industry practices, Customer agrees
to use reasonable efforts to implement automated interfaces with SEI for money
market Portfolios. In the event Customer does not implement TradeNet and
Automated Reconciliation Review for non-money market Portfolios by the first
anniversary of this Agreement, SEI reserves the right to assess a reasonable
surcharge hereunder.
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ARTICLE 3. ALLOCATION OF CHARGES AND EXPENSES. SEI shall furnish at its own
expense the executive, supervisory and clerical personnel necessary to perform
its obligations under this Agreement. The Customer shall reimburse SEI for its
reasonable out-of-pocket expenses incurred on behalf of the Customer, including
(but not limited to) the travel and lodging expenses incurred by its officers
and employees in connection with attendance at meetings requested by the
Customer, pricing services fees, reasonable allocation of SAS 70 audit expenses
and third-party pricing service fees incurred by SEI in the performance of its
duties and all reasonable charges for copying, postage, telephone, and fax
incurred by the SEI in the performance of its duties hereunder in accordance
with agreed upon procedures. SEI shall provide Customer documentation evidencing
out-of-pocket expenses and their allocation as reasonably requested by Customer.
ARTICLE 4. COMPENSATION OF SEI. Customer agrees to pay SEI annual fees
for the services provided under this Agreement in accordance with the Fee
Schedule set forth in Customer Schedule C. SEI monthly all fees calculated as
set forth in this Article 4. Such compensation shall be calculated and accrued
daily and paid to SEI monthly. SEI will invoice Customer each month for services
rendered, each such payment to be due sixty (60) days after the date of invoice
If the Agreement becomes effective subsequent to the first day of a month or
terminates before the last day of a month, SEI's compensation for that part of
the month in which this Agreement is in effect shall be prorated in a manner
consistent with the calculation of the fees set forth above.
Customer agrees to pay all state and local sales, and/or use taxes, or
any equivalent thereof, except for taxes on SEI's property or net income, which
may be assessed against SEI or Customer with respect to this Agreement or the
services provided by SEI hereunder. At its option, SEI may include such taxes in
its invoices in which event Customer will pay to SEI the taxes so invoiced.
ARTICLE 5. LIMITATION OF LIABILITY OF SEI. The duties of SEI shall be
confined to those expressly set forth herein, and no implied duties are assumed
by or may be asserted against SEI. SEI shall not be liable for any error of
judgment or mistake of law or for any loss arising out of any investment or for
any act or omission in carrying out its duties hereunder, except a loss
resulting from willful misfeasance, bad faith or gross negligence in the
performance of its duties, or by reason of reckless disregard of its obligations
and duties hereunder, except as may otherwise be provided under provisions of
applicable law which cannot be waived or modified hereby. (As used in this
Article 5, the term "SEI" shall include directors, officers, employees,
affiliates and other corporate agents and representatives of SEI as well as that
corporation itself.) Under no circumstances shall SEI be liable to the Customer
for consequential, indirect or punitive damages. Customer shall be solely
responsible for each Portfolio's compliance with applicable investment policies,
laws and regulations and any losses attributable to non-compliance with
applicable investment policies, laws and regulations, except to the extent that
such non-compliance was due to SEI's failure to meet the standard of care set
forth herein.
So long as SEI does not act with willful misfeasance, bad faith or
gross negligence, or reckless disregard of its obligations and duties hereunder,
Customer assumes full responsibility and shall indemnify SEI and hold it
harmless from and against any and all actions, suits and claims, whether
groundless or otherwise, and from and against any and all losses, damages,
costs, charges, reasonable counsel fees and disbursements, payments, expenses
and liabilities (including reasonable investigation expenses)arising directly or
indirectly out of said fund accounting relationship to Customer or any other
service rendered to Customer hereunder. The indemnity and defense provisions set
forth herein shall indefinitely survive the termination of this Agreement.
SEI shall indemnify and hold the Customer harmless from and against
any and all actions, suits, and claims, whether groundless or otherwise, and
from and against any and all losses, damages, costs,
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charges, reasonable counsel fees and disbursements, payments, expenses and
liabilities (including reasonable investigation expenses)arising directly or
indirectly out of the willful misfeasance, bad faith or gross negligence in the
performance of its duties, or by reason of reckless disregard of its obligations
and duties hereunder.
The indemnification rights of either party hereunder shall include the
right to reasonable advances of defense expenses in the event of any pending or
threatened litigation with respect to which indemnification hereunder may
ultimately be merited; provided, however, that in the event that it is
ultimately determined that indemnification is not warranted, any such amounts
advanced hereunder shall be repaid. In order that the indemnification provision
contained herein shall apply, however, it is understood that if in any case
Customer may be asked to indemnify or hold the indemnified party harmless, the
indemnifying party shall be fully and promptly advised of all pertinent facts
concerning the situation in question, and it is further understood that the
indemnified party will use all reasonable care to identify and notify the
indemnifying party promptly concerning any situation which presents or appears
likely to present the probability of such a claim for indemnification against
indemnifying party, but failure to do so in good faith shall not affect the
rights hereunder unless such failure was in fact prejudicial to the indemnified
party.
The indemnifying party shall be entitled to participate at its own
expense or, if it so elects, to assume the defense of any suit brought to
enforce any claims subject to this indemnity provision. If the indemnifying
party elects to assume the defense of any such claim, the defense shall be
conducted by counsel chosen by the indemnifying party and satisfactory to the
indemnified party, whose approval shall not be unreasonably withheld. In the
event that the indemnifying party elects to assume the defense of any suit and
retain counsel, the indemnified party shall bear the fees and expenses of any
additional counsel retained by it. If the indemnifying party does not elect to
assume the defense of a suit, it will reimburse indemnified party for the
reasonable fees and expenses of any counsel retained by indemnified party*
SEI may apply to Customer at any time for instructions and may consult
outside counsel for Customer or its own counsel and with accountants and other
experts with respect to any matter arising in connection with SEI's duties, and
SEI shall not be liable or accountable for any action taken or omitted by it in
good faith and without gross negligence in accordance with such instruction or
with the opinion of such counsel, accountants or other experts.
Also, SEI shall be protected in acting upon any document, which it
reasonably believes to be genuine and to have been signed or presented by the
proper person or persons.
Nothing herein shall make SEI liable for the performance or omissions
of unaffiliated, nationally or regionally recognized third parties such as, by
way of example and not limitation, Airborne Services, Federal Express, UPS, the
U. S. Mails, AT & T, Sprint, MCI and other delivery, telecommunications and
other companies not under SEI's reasonable control, and third parties not under
SEI's reasonable control providing services to the financial industry generally,
such as, by way of example and not limitation, the National Securities Clearing
Corporation (processing and settlement services), transfer agents and custodian
banks.
ARTICLE 6. ACTIVITIES OF SEI. The services of SEI rendered to Customer
are not to be deemed to be exclusive. SEI is free to render such services to
others and to have other businesses and interests.
ARTICLE 7. TERM AND TERMINATION. This Agreement shall become effective
upon the date first written above. The initial term of this Agreement will be
five (5)years, commencing as of the date
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Customer first receives fund accounting services hereunder. This Agreement shall
be binding on all successors and permitted assignees of the parties.
Upon conclusion of the initial term, this Agreement will automatically
remain in full force and effect for a three (3) year renewable term, and for
succeeding three (3) year renewable terms thereafter, unless the Agreement is
terminated as provided below. Customer or SEI may elect to terminate this
Agreement on the last day of the initial term or any renewal term by notifying
the other in writing not less than sixty (60) days prior to the end of the then
current term. Customer may elect to terminate this Agreement if all key
management personnel (i. e., managing directors and accounting directors of
mutual fund services operations) of SEI terminate their employment in a
concerted plan and SEI fails to replace such personnel with suitable
replacements of a comparable experience in a reasonable period of time, SEI and
its personnel fail on a regular basis to be in material compliance with
regulatory guidelines and regulations and such material non-compliance has
directly resulted in material adverse harm to the Customer, or in the event SEI
has materially failed to perform its duties under this Agreement, and such
material failure has not been cured within 60 days after written notice is
received by Customer specifying the nature of the material failure and the
reasonable steps to be taken by SEI to remedy the failure.
Customer may terminate this Agreement for convenience as of either the
second or third anniversary of the effective date of the Agreement in order to
permit Customer and its employees (or affiliates) to perform the services under
this Agreement, subject to Customer making a termination for convenience payment
to SEI as provided herein. Customer agrees to make a lump-sum payment on the
termination date to SEI of $750,000 if the termination for convenience is
effected on the second anniversary of the Agreement or $500,000 if the
termination for convenience is effected on the third anniversary of the
Agreement. Customer acknowledges and agrees that the termination for convenience
payment is not a penalty and is to compensate SEI for lost profitability in the
event of SEI's early termination for Customer's convenience. Customer must
provide SEI at least ninety (90) days prior written notice to terminate for
convenience. "Termination for convenience" shall mean that substantially all the
services provided by SEI under this Agreement shall be performed by officers and
employees of Customer (or its affiliates) on conversion and such services may
not be delegated by Customer to a third-party (other than an affiliate) for
performance for a minimum of nine (9) months.
ARTICLE 8. CERTAIN RECORDS. SEI shall maintain customary records in
connection with its duties as specified in this Agreement. Any records prepared
or maintained by SEI on behalf of the Portfolios shall be prepared and
maintained at the expense of SEI, but shall be the property of the Portfolios
and will be made available to or surrendered promptly to Customer or the
Portfolios on request.
In case of any request or demand for the inspection of such records by
another party, SEI shall notify Customer and follow Customer's instructions as
to permitting or refusing such inspection; provided that SEI may exhibit such
records to any person in any case where it is advised by its counsel that it may
be held liable for failure to do so, unless (in cases involving potential
exposure only to civil liability) Customer has agreed to indemnify SEI against
such liability.
ARTICLE 9. GENERAL PROVISIONS.
NOTICE. Any requests, instructions, payments, or notices permitted or
required hereunder will be deemed given when delivered in hand or mailed,
postage prepaid, as respectively set forth below or to such other address as
either party may from time to time designate in writing; or, if permitted
hereunder, when sent by facsimile transfer as respectively set forth below with
a hard copy mailed, postage prepaid. All such notices shall be mailed or
delivered at the address set forth below or to such other address as either such
party may from time to time designate in writing:
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If to Customer:
TD Waterhouse Investors Services, Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxx Xxxxxx, General Counsel
If to SEI:
SEI Investment Mutual Funds Services
Xxx Xxxxxxx Xxxxxx Xxxxx
Xxxx, XX 00000-0000
Attention: General Counsel
ARTICLE 10. COUNTERPARTS. This Agreement may be executed in any number
of counterparts and any party hereto may execute any such counterpart, each of
which when executed and delivered will be deemed to be an original and all of
which counterparts taken together will constitute but one and the same
instrument. This Agreement will become binding when one or more counterparts
taken together will have been executed and delivered by the parties. It will not
be necessary in making proof of this Agreement or any counterpart hereof to
produce or account for any of the other counterparts.
ARTICLE 11. AGREEMENT FOR SOLE BENEFIT OF SEI AND CUSTOMER. This
Agreement is for the sole and exclusive benefit of SEI and Customer and will not
be deemed to be for the direct or indirect benefit of the clients or customers
of SEI or Customer. The clients or customers of SEI or Customer will not be
deemed to be third party beneficiaries of this Agreement nor to have any other
contractual relationship with SEI by reason of this Agreement and each party
hereto agrees to indemnify and hold harmless the other party from any claims of
its clients or customers against the other party including any attendant
expenses and attorneys' fees, based on this Agreement or the services provided
hereunder.
ARTICLE 12. ASSIGNMENT. SEI and Customer will each have the right to
assign or delegate all or part of its respective rights, responsibilities, or
duties hereunder to any subsidiary, parent or affiliate of SEI or Customer owned
by or affiliated with such party upon the provision of prior written notice to
the other party, but no such assignment or delegation will relieve Customer of
its payment obligations under Article 4 hereof. Such assignment or delegation
will be valid only so long as the assignee or delegate remains a subsidiary,
affiliate or parent of SEI or Customer and in the event of any such assignment,
SEI or Customer will remain responsible for the acts of any such entity. SEI
will only assign or delegate its responsibilities or duties without consent of
Customer to a subsidiary, parent or affiliates equally capable of performing the
services agreed to herein. Except as otherwise provided herein, any other
assignment or delegation by either party hereto will require the prior written
approval of the other party hereto.
ARTICLE 13. GOVERNING LAW. This Agreement will be governed and
construed in accordance with the laws of the State of New York without giving
effect to conflict of law provisions.
ARTICLE 14. FORCE MAJEURE. No breach of any obligation of a party to
this Agreement will constitute an event of default or breach to the extent it
arises out of a cause, existing or future, that is beyond the control and
without negligence of the party otherwise chargeable with breach or default,
including without limitation: work action or strike; lockout or other labor
dispute; flood; war; riot; theft; earthquake or natural disaster. Either party
desiring to rely upon any of the foregoing as an excuse for default or breach
will, when the cause arises, give to the other party prompt notice of the facts
which constitute such cause; and, when the cause ceases to exist, give prompt
notice thereof to the other party. Should one or more of the preceding force
majeure events occur and SEI fails to deliver the services to be provided under
this Agreement for more than five (5) business days and at the end of five (5)
business days SEI is not implementing disaster recovery plans on a reasonably
timely basis, SEI agrees, to a
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reasonable extent, to cooperate with Customer, to continue to perform hereunder,
and, if necessary, to take such actions as are commercially reasonable to insure
the orderly, effective and expeditious termination and succession of the
services hereunder without the payment of any termination for convenience fees
or any penalties.
ARTICLE 15. HEADINGS. All Article headings contained in this Agreement
are for convenience of reference only, do not form a part of this Agreement and
will not affect in any way the meaning or interpretation of this Agreement.
Words used herein, regardless of the number and gender specifically used, will
be deemed and construed to include any other number, singular or plural, and any
other gender, masculine, feminine, or neuter, as the contract requires.
ARTICLE 16. CONTENTS OF AGREEMENT. This Agreement and its Schedules
set forth the entire understanding of the parties hereto with respect to the
transactions contemplated hereby. It will not be amended or modified except by
written instrument duly executed by each of the parties hereto. Any and all
previous agreements and understandings between the parties regarding the subject
matter hereof, whether written or oral, including the letter agreement dated
July 25, 2000, are superseded by the Agreement.
ARTICLE 17. WAIVER. Any term or provision of this Agreement may be
waived at any time by the party entitled to the benefit thereof by written
instrument executed by such party. No failure of either party hereto to exercise
any power or right granted hereunder, or to insist upon strict compliance with
any obligation hereunder, and no custom or practice of the parties with regard
to the terms of performance hereof, will constitute a waiver of the rights of
such party to demand full and exact compliance with the terms of this Agreement.
ARTICLE 18. SEVERABILITY. In the event that any provision of this
Agreement will be found in violation of public policy or illegal or
unenforceable in law or equity, such finding will in no event invalidate any
other provision of this Agreement.
[INTENTIONALLY LEFT BLANK; GO TO NEXT PAGE]
EACH PARTY HERETO ACKNOWLEDGES THAT EACH PARTY RESPECTIVELY HAS READ
THIS AGREEMENT, UNDERSTANDS ITS TERMS, AND AGREES TO BE LEGALLY BOUND HEREBY.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in their respective names by their duly authorized representatives as
of the day and year first above written.
TD WATERHOUSE INVESTOR SERVICES, INC.
By: /s/ Xxxxx X. Xxxxxxxx
Title: Xxxxx X. Xxxxxxxx
Name: Chief Operating Officer
SEI INVESTMENT MUTUAL FUNDS SERVICES
By: /s/ Xxxxx X. Xxxxx
Name: Xxxxx X. Xxxxx
Title: Vice President
SCHEDULE A
PORTFOLIOS
"TDW TRUST" MEANS TD WATERHOUSE TRUST
"TDW FAMILY" MEANS TD WATERHOUSE FAMILY OF FUNDS, INC.
"NICM FUND" MEANS NATIONAL INVESTORS CASH MANAGEMENT FUND, INC.
EFFECTIVE AS OF SEPTEMBER 1, 2000(1)
TDW Trust-Bond Index Fund
TDW Trust-500 Index Fund
TDW Trust-Extended Market Index Fund
TDW Trust-Asian Index Fund
TDW Trust-European Index Fund
TDW Trust-Technology Fund
TDW Trust-Tax Managed Growth Fund
TDW Family-NY Municipal Money Market Fund
TDW Family-CA Municipal Money Market Fund
EFFECTIVE AS OF OCTOBER 1, 2000(2)
TDW Trust-Dow 30 Fund
TDW Family-Government Money Market Portfolio
TDW Family-Money Market Portfolio
TDW Family-Municipal Money Market Portfolio
NICM Fund-Government Money Market Portfolio
NICM Fund-Money Market Portfolio
NICM Fund-Municipal Money Market Portfolio
[End of Schedule A]
(1) Compensation paid to SEI under Schedule C of this Agreement on behalf of the
listed Portfolios is effective September 1, 2000.
(2) Compensation paid to SEI under Schedule C of this Agreement on behalf of the
listed Portfolios is effective October 1, 2000.
A-l
SCHEDULE B
ACCOUNTING SERVICES
LIST OF DUTIES/RESPONSIBILITIES
as of September 1, 2000
DAILY ACCOUNTING SERVICES
A) Calculate Net Asset Value (and Offering Price) Per Share:
1. Update the daily market value of securities held by each
Portfolio using standard agents for pricing domestic equity, bond
and foreign securities. The standard domestic equity, bond and
foreign security pricing service is IDC. X. X. Reuters is used
for exchange rates and spot rates.
2. Enter manual prices supplied by client and/or broker.
3. Calculate NAV. Review change in NAV for reasonableness.
4. Review security price variance, investigate price changes in
individual equities exceeding 5%, bonds exceeding 2% and exchange
rates exceeding 1%.
5. Complete daily variance analysis on foreign exchange rates and
local foreign prices. Notify the client of changes exceeding
established levels for the client's verification.
6. Electronically communicate required pricing information (NAV/POP)
to client, transfer agent and NASDAQ.
SEI pricing and valuation services will be conducted in accordance
with each Portfolio's Prospectus and SAI and Pricing and Fair Value
Procedures mutually agreed to by Customer and SEI.
B) Complete Money Market (Daily Dividend) Fund Requirements:
1. Calculate net investment income available for distribution
daily.^
2. Calculate daily rate, and 1, 7, 30 -day yields.
3. Supply Transfer Agent and client with distribution rates.^
4. Provide xxxx to market, original and amortized cost schedules in
accordance with valuing the Portfolio based on amortized cost.
^Function to also be completed for the Dow 30 Fund and the Bond Index
Fund.
C) Reconcile and Record All Daily Expense Accruals:
1. Accrue expenses based on budget either as percentage of
Portfolio's net assets or specific dollar amounts.
2. Monitor expense limitations established by client.
3. Accrue daily amortization of organizational expense, if any.
4. Complete daily accrual of 12b-1 expenses, if any.
D) Verify and Record All Daily Income Accruals for Debt Issues:
1. Review and verify all system-generated Interest and Amortization
reports.
2. Establish security codes for bond issues to permit income by
state tax reporting.
E) Monitor Securities Held for Cash Dividends, corporate actions and
capital changes such as splits, mergers, spin-offs, etc. and process
appropriately.
1. Monitor electronically received information from Xxxxxx Data
Corporation for all domestic securities.
2. Interface with custodian to monitor timely collection and
postings of corporate actions, dividends and interest.
3. Process international dividend and capital change information
received from the Custodian, Advisor, and IDC. If selected by the
client, back-up information on foreign dividends and corporate
actions may also be obtained form Xxxxxx Data Corporation/Extel
or Interactive Data Corporation (as pricing vendor for the Fund).
4. Provide xxxx-to-market analysis for currency exchange rate
fluctuations on unsettled dividends and interest.
F) Enter All Security Trades on Investment Accounting System based on
written instructions from the client.
1. Review system verification of trade and interest calculations.
2. Verify settlement through the Custodian statements.
3. Maintain security ledger transaction reporting.
4. Maintain tax lot holdings.
5. Determine realized gains or losses on security trades.
6. Provide complete broker commission reporting.
7. Provide foreign currency exchange rate realized and unrealized
gain/loss detail.
G) Enter All Fund Share Transactions on Accounting System
1. Process activity identified on the Transfer Agent reports.
2. Verify settlement through the Custodian statements.
3. Reconcile to the Transfer Agent report balances.
H) Review and Reconcile With Custodian Statements:
1. Reconcile cash balance on daily basis.
2. Reconcile securities daily with BONY (weekly only until Automated
Custody Reconciliation implemented).
I) Monitor and review SEC 30 day yield calculation for non-money market
funds.
J) Submission of Daily Accounting Reports to Client: (Additional reports
readily available.)^
^SEI will use reasonable efforts to deliver estimates of Portfolio
cash and holding reports to Customer by facsimile or e-mail by 10 a.
m. under normal operating conditions.
1. Non-Money Market Funds
a. Portfolio Valuation (listing inclusive of holdings, costs,
market values, unrealized appreciation/depreciation and
percentage of portfolio comprised of each security).
b. NAV Calculation Report.
c. Maturity Schedule
2. Money Market Funds
a. NAV Calculation Report with Daily Distribution Rate.
b. Daily, 7-day and 30-day yield calculations.
c. Cash Availability.
d. Dollar Weighted Average Maturity/Maturity Schedule.
WEEKLY ACCOUNTING SERVICES
The Fund Accounting unit will submit Money Market Fund Xxxx-to-Market
Report and Interest and Amortization schedules to clients (based on client
or vendor-supplied money market yields or prices).
MONTHLY ACCOUNTING SERVICES
1)SUBMISSION OF DAILY/MONTHLY AUTOMATED REPORTS TO FUND/CLIENT: (at clients
request)
a. Security Purchase/Sales Journal.
b. Interest and Maturity Report.
c. Brokers Ledger (Commission Report).
d. Security Ledger Transaction Report with Realized
Gains/Losses.
e. Security Ledger Tax Lot Holdings Reports.
f. Additional reports available upon request.
g. Wash Sales Report
ANNUAL (AND SEMI-ANNUAL)ACCOUNTING SERVICES
A) Assist and supply auditors with schedules supporting securities and
shareholder transactions, income and expense accruals, etc. during the
year in accordance with standard audit assistance requirements.
B) Provide Form N-SAR Reporting
If the Form N-SAR items below are applicable, the Fund
Accounting unit will answer the following items:
2, 12B, 20, 21, 22, 23, 28, 30A, 31, 32, 35, 36, 37, 43,
53, 55, 62, 63, 64B, 71, 72, 73.
FINANCIAL AND MANAGEMENT REPORTING
A. Income and Expenses
1. Preparation of budgets
2. Expense figure calculated and accrual levels set
3. Monitoring of expenses
5. Projection of Income
B. Distributions to Shareholders
1. Calculation of distribution amounts
a. Compliance with income tax provisions
b. Compliance with excise tax provisions
c. Compliance with prospectus
2. Compilation of distributions for year end tax reporting to
shareholders
C. Tax Preparation & Reporting
1. Coordination of State Income Tax Shareholder Reporting
2. Coordination of Foreign Tax Credit Shareholder Notification
D. Financial Reporting
1. Liaison between fund management and auditors
2. Preparation and delivery of first draft of semi-annual and annual
financial statements to Customer within 25 days of period end
under normal operating conditions
3. 60 day delivery to SEC and shareholders
3. Ensure compliance with all disclosure requirements
E. Secondary Subchapter M Compliance Monitoring
1. Asset diversification test
2. Income qualification test
F. Other Financial Analysis
1. Upon request from fund management, other budgeting and analyses
can be constructed to meet a fund's specific needs
G. Review and Monitoring Functions
1. Review NAV calculations
2. Review 12b-1, accruals, expenditures and payment trail
commissions where applicable
H. Performance Reporting
1. Provide performance reporting to third party services
2. Calculate non-SEC yields
SECONDARY COMPLIANCE MONITORING
A. Compliance - Investment Company Act of 1940
a. Compliance Monitoring (daily basis)
a. 5% issuer restrictions
b. 5% / 10% RIC restriction
c. 25% Industry basket
d. 10% LOC restriction
B. Compliance - Prospectus
1. Investment Objectives and Prospectus limitations:
a. Monitor restricted security limitations
b. Monitor percentages required to fulfill investment objective
(i. e. minimum of 65% of securities in an asset class)
c. Securities lending limitations (if permitted)
d. Quality ratings pertaining to securities held (if
applicable)
2. 2a-7 Compliance/Restriction:
a. All Money Markets are monitored to maintain compliance with
Rule 2a-7.
b. Average Weight of Maturity
c. Maximum Maturity Date of Securities
d. Quality Ratings of Securities (i. e. NRSRO)
C. Compliance - other
1. Derivative Reporting
2. SEC "Alert" communications
3. Presentation of compliance violations to Board of Trustees (if
applicable)
SPECIAL ISSUES RELATED TO FOREIGN INVESTMENT
A. Financial Reporting
1. Preparation of required financial statement disclosure
a. Foreign currency contracts
b. Realized foreign exchange gains/losses
c. Foreign tax reclaims
B. Tax Reporting
1. Monitor and review tax reclaims chronologically, by country and
type; report on same to Fund management
a. File/complete tax withholding documents, as supplied by the
custodian
2. Review and monitor treatment of currency gain/loss and capital
gain/loss
a. Section 988 transactions
b. Section 1256 contracts
3. Determine tax treatment of foreign investments and their impact
on
a. Sub-chapter M tests --e. g., diversification, qualified
income, 30% tests
b. Taxable income and capital gains
4. Calculate distributions to shareholders
a. Monitor character and impact of realized currency gain/loss
on distribution amount
b. Calculate income and expenses by country in order to
determine foreign tax credit available to shareholders.
[END OF SCHEDULE B]
SCHEDULE C
FUND ACCOUNTING FEES
ANNUAL ASSET BASED FEE:
2.0 basis points (.02%) on the first $5,000,000,000
1.5 basis points (.015%) on all assets over $5,000,000,000
ANNUAL MINIMUM FEES:
Complex Minimum for initial 16 Portfolios: $1,200,000
Each additional Portfolio over the initial 16 Portfolio's listed on
Schedule B shall increase the Complex Minimum as follows:
$50,000 per domestic Portfolio
$65,000 per international Portfolio
Each Portfolio shall be subject to additional charge of $15,000 for
each share class in excess of the initial class.
For the period of September 1, 2000 to September 30, 2000 only,
Portfolios commencing operations on or about September 1,2000 shall be
subject to an aggregate flat fee of $65,000. Otherwise, the Annual
Asset Based Fee and Annual Minimum Fees shall be in effect. The fee
proposal does not include Distribution Services. Includes 10 seats for
MaxWorks.
ACKNOWLEDGED AND AGREED TO:
TD WATERHOUSE INVESTOR SERVICES, INC.
By: /s/ Xxxxx X. Xxxxxxxx
Name: Xxxxx X. Xxxxxxxx
Title: Chief Operating Officer
Date: 9/1/00
SEI INVESTMENT MUTUAL FUNDS SERVICES
By: Xxxxx X. Xxxxx
Name: Xxxxx X. Xxxxx
Title: Vice President
Date: 9/1/00
[End of Schedule C]
