EXHIBIT (H)(27)
REIMBURSEMENT AGREEMENT
THIS REIMBURSEMENT AGREEMENT (this "Agreement") is made as of this ___
day of __________, 2002 by and between Xxxxxxxx Xxxxx & Associates, Inc., a
Wisconsin corporation (the "Adviser"), and Xxxxxxxx Plumb Funds, Inc., a
Wisconsin corporation and registered open-end management investment company (the
"Company"), on behalf of its various mutual fund series (the "Funds").
RECITALS:
WHEREAS, the Adviser has entered and expects to enter into various
agreements with broker-dealers, trust companies, banks and other financial
institutions, professional investment consultants and others (collectively, the
"Service Providers"), pursuant to which the Adviser pays the Service Providers a
fee for various shareholder services that the Service Providers provide in
connection with investments by their clients in the Funds;
WHEREAS, the shareholder services provided by the Service Providers
(the "Services") in exchange for the fee paid by the Adviser include, among
other matters, maintaining records of client holdings in the Funds (which may
involve maintaining omnibus accounts); communicating with clients regarding
their holdings in the Funds, responding to their inquiries about the Funds,
facilitating client compliance with purchase, redemption and exchange procedures
and other shareholder services offered by the Funds, and forwarding
prospectuses, statements of additional information, annual and semi-annual
reports, proxy statements and other information furnished to Fund shareholders;
communicating with, and providing information to, the Funds regarding purchase,
redemption and exchange orders received from clients; and preparing, filing and
distributing tax information and reports;
WHEREAS, the Board of Directors of the Company, including a majority of
the directors who are "interested persons" (as defined in the Investment Company
Act) of the Company or the Adviser, has determined that the Services benefit the
Funds by eliminating or reducing some of the costs, fees and expenses that the
Funds would otherwise have to pay in the absence of agreements for the provision
of the Services, and that it would be appropriate for the Funds to reimburse the
Adviser for a portion of the fees it pays to the Service Providers for the
Services;
NOW, THEREFORE, in consideration of the foregoing recitals and the
mutual covenants contained herein, and for other valuable consideration, the
receipt and adequacy of which are hereby acknowledged, the parties agree as
follows:
1. Reimbursement.
a. Each relevant Fund shall reimburse the Adviser, on a monthly basis
in arrears, an amount (the "Reimbursement Amount") calculated in accordance with
Section 1(b) below, representing a portion of the fees that the Adviser paid to
the Service
Providers for the Services during the month. The Reimbursement Amount shall be
supported by a detailed accounting provided to the Company by the Adviser.
Copies of records supporting the accounting will be maintained by the Adviser
for at least six years and will be available for inspection upon request by the
Company. The Reimbursement Amount shall be paid by the Company on behalf of, and
out of the assets of, the relevant Fund within 30 days following receipt of the
statement for the Reimbursement Amount.
b. The Reimbursement Amount for a Fund shall be equal to the costs,
fees and expenses that the Fund would have been required to pay during the
applicable period (such as transfer agency fees and mailing and fulfillment
costs) in the absence of agreements with the Service Providers for the provision
of the Services and assuming that the clients of the Service Providers had
invested in the Fund directly and not through or with the assistance of the
Service Providers, but in no event shall the Reimbursement Amount be more than
the fees paid by the Adviser to the Service Providers under the agreements for
the provision of the Services. It is understood and agreed that if a Service
Provider maintains an omnibus account, the Funds will save transfer agency fees
(which are based in part on the number of Fund accounts) because of that service
and could reimburse the Adviser for an amount equal to those savings. If the
Service Provider discloses the number of its client accounts that are invested
in each Fund through the Service Provider's omnibus account, a determination of
the transfer agency fee savings will be made by reference to the transfer agency
fees paid per Fund account. If a Service Provider does not disclose the number
of its client accounts that are invested in a Fund through the Service
Provider's omnibus account, the Adviser will estimate such number based on the
average size of the Service Provider's client accounts' investments in the Fund
or if such average is not available based on the average size of other Service
Providers' client accounts' investments in the Fund. If the Service Providers,
as part of their Services, deliver a Fund's prospectuses, statements of
additional information, annual reports, semi-annual reports, proxy statements
and other information required to be delivered to shareholders of the Fund or
delivered at their client's request, the Fund will save mailing and/or
fulfillment costs and the Adviser may determine those mailing and/or fulfillment
cost savings with information provided by the Company. In all cases, the Adviser
shall determine the Reimbursement Amount in its reasonable, good faith
discretion, subject to Board review and rejection.
2. Company Board Review. Information as to the Reimbursement Amounts,
including the detailed accounting and such other information the Company's Board
of Directors requests will be provided to the Board at least quarterly. The
Board of Directors of the Company may reject any Reimbursement Amounts paid
under this Agreement. If the Board, by a majority of the directors who are not
"interested persons" (as defined in the Investment Company Act of 1940) of the
Company or the Adviser, acting in good faith, rejects any of the Reimbursement
Amounts for a Fund, the Adviser shall issue to the Fund a credit equal to the
rejected portions of the Reimbursement Amount, which credit may be applied
against future Reimbursement Amounts or investment advisory fees owed by the
Fund.
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3. Term and Termination. This Agreement shall continue for a period of
one year from the date hereof and thereafter so long as its continuance is
specifically approved at least annually by the Board of Directors of the
Company. Notwithstanding the above, either party hereto, by a decision of its
Board of Directors (or in the case of the Company, by a majority of its
non-interested directors), may terminate this Agreement for any reason on at
least 60 days' prior written notice. This Agreement shall automatically
terminate in the event of its assignment (as defined in the Investment Company
Act of 1940).
4. Miscellaneous. This Agreement shall be governed by and construed in
accordance with the laws of the State of Wisconsin, except to the extent
superseded or preempted by the Investment Company Act of 1940. This Agreement
may not be modified except in writing signed by each party hereto. This
Agreement embodies the entire agreement between the parties with respect to the
subject matter hereof and supersedes any prior or contemporaneous agreements,
arrangements, understandings, negotiations or discussions regarding such subject
matter. This Agreement may be executed in counterparts, each of which shall be
deemed an original but all of which shall together constitute a single
agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
XXXXXXXX XXXXX FUNDS, INC.
By:______________________________
Title:___________________________
XXXXXXXX PLUMB & ASSOCIATES, INC.
By:______________________________
Title:___________________________
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