FUND ACCOUNTING SERVICING AGREEMENT
THIS AGREEMENT ("Agreement") is made and entered into as of this 20th day
of December, 2001, by and between Fort Pitt Capital Funds, a Delaware business
trust (the "Trust") and U.S. Bancorp Fund Services, LLC, a Wisconsin limited
liability company ("USBFS").
WHEREAS, the Trust is registered under the Investment Company Act of 1940,
as amended (the "1940 Act"), as an open-end management investment company, and
is authorized to issue shares of beneficial interest in separate series, with
each such series representing interests in a separate portfolio of securities
and other assets;
WHEREAS, USBFS is, among other things, in the business of providing mutual
fund accounting services to investment companies; and
WHEREAS, the Trust desires to retain USBFS to provide accounting services
to each series of the Trust listed on Exhibit A hereto (as amended from time to
time) (each a "Fund", collectively the "Funds").
NOW, THEREFORE, in consideration of the promises and mutual covenants
herein contained, and other good and valuable consideration, the receipt of
which is hereby acknowledged, the parties hereto, intending to be legally bound,
do hereby agree as follows:
1. Appointment of USBFS as Fund Accountant
The Trust hereby appoints USBFS as fund accountant of the Trust on the
terms and conditions set forth in this Agreement, and USBFS hereby accepts
such appointment and agrees to perform the services and duties set forth in
this Agreement.
2. Services and Duties of USBFS
USBFS shall provide the following fund accounting services for each Fund,
including but not limited to:
A. Portfolio Accounting Services:
(1) Maintain portfolio records on a trade date+1 business day basis
using security trade information communicated from the investment
manager.
(2) For each valuation date as described in each Fund's current
registration statement on file with the Securities and Exchange
Commission ("Registration Statement"), obtain prices from pricing
sources approved by the Board of Trustees of the Trust (the
"Board of Trustees" or the "Trustees") and apply those prices to
the portfolio positions. For those securities where market
quotations are not readily available, USBFS shall use prices
provided by the Board of Trustees or the Fund's investment
advisor.
(3) Identify interest and dividend accrual balances of the Funds'
portfolio securities as of each valuation date and calculate
gross earnings on investments for the accounting period.
(4) Determine gain/loss on security sales and identify them as
short-term or long-term as these terms are defined in the
Internal Revenue Code; account for periodic distributions of
gains or losses to shareholders; and maintain undistributed gain
or loss balances of the Funds' portfolio securities as of each
valuation date.
(5) Maintain a daily listing of portfolio holdings by Fund showing
cost, market value, and the percentage of portfolio comprised of
each security.
(6) Reconcile accounting asset listings against custodian's asset
listings on at least a monthly basis and report any securities
balance discrepancies promptly to the Trust and its custodian.
B. Expense Accrual and Payment Services:
(1) For each valuation date of the Funds' portfolio securities,
calculate the expense accrual amounts as directed by the Trust as
to methodology, rate and/or dollar amount.
(2) Record payments for each Fund's expenses upon receipt of
authorization from the Trust.
(3) Account for Fund expenditures and maintain expense accrual
balances at the level of accounting detail consistent with
generally accepted industry accounting principles.
(4) Provide expense accrual and payment reporting.
C. Fund Valuation and Financial Reporting Services:
(1) Account for Fund share purchases, sales, exchanges, transfers,
dividend reinvestments, and other Fund share activity as reported
by each Fund's transfer agent on a timely basis.
(2) Apply equalization accounting as directed by the Trust.
(3) Determine net investment income (earnings) for each Fund as of
each valuation date. Account for periodic distributions of
earnings to shareholders and maintain undistributed net
investment income balances as of each valuation date.
(4) Maintain a general ledger and other accounts, books, and
financial records for each Fund in the form as the parties may
reasonably agree upon.
(5) Calculate each Fund's net asset value according to the accounting
policies, relevant regulatory requirements, the Trust's charter
documents and procedures set forth in each Fund's current
Registration Statement, and any other policies as may be legally
adopted by the Trust's Board of Trustees.
(6) Calculate per share net asset value, per share net earnings, and
other per share amounts reflective of Fund operations at such
time as required by the nature and characteristics of each Fund
and as reasonably requested by the Fund or the Fund's investment
advisor.
(7) Communicate, at an agreed upon time, the per share price for each
valuation date to parties as agreed upon from time to time which
agreement cannot be unreasonably withheld.
(8) Prepare monthly reports that document the adequacy of accounting
detail to support month-end ledger balances.
D. Tax Accounting Services:
(1) Maintain accounting records for the investment portfolio of each
Fund to support the tax reporting required for IRS-defined
regulated investment companies.
(2) Maintain tax lot (?)detail for each Fund's investment portfolio.
(3) Calculate taxable gain/loss on security sales using the tax lot
(?) relief method designated by the Trust.
(4) Provide the necessary financial information to support the
taxable components of income and capital gains distributions to
each Fund's transfer agent to support tax reporting to the
shareholders.
E. Compliance Control Services:
(1) Support reporting to regulatory bodies and support financial
statement preparation by making each Fund's accounting records
available to the Trust, its investment advisor, the Securities
and Exchange Commission (the "SEC") or other regulatory or
governmental authorities, and the outside independent auditors.
(2) Maintain accounting records according to the 1940 Act and
regulations provided thereunder.
F. USBFS will perform the following accounting functions on a daily
basis:
(1) Reconcile cash and investment balances of each Fund with each
Fund's custodian, and provide each Fund's investment adviser with
the beginning cash balance available for investment purposes.
(2) Transmit or mail a copy of the portfolio valuation to each Fund's
investment adviser.
(3) Review the impact of current day's activity on a per share basis,
and review changes in market value.
(4) Provide a list of the Funds' portfolio securities and the amount
of shares, units, etc. of each.
G. In addition, USBFS will:
(1) Prepare monthly security transactions listings.
(2) Supply various Trust, Fund and class statistical data as
requested by the Trust on an ongoing basis.
3. Pricing of Securities
USBFS shall obtain prices daily from a pricing source selected by USBFS but
approved by the Board of Trustees and apply those prices to the portfolio
positions of each Fund. For those securities where market quotations are
not readily available, USBFS shall use prices provided by the Board of
Trustees or the Fund's investment adviser.
If the Trust desires to provide a price that varies from the pricing
source, the Trust shall promptly notify and supply USBFS with the valuation
of any such security on each valuation date. All pricing changes made by
the Trust will be in writing and must specifically identify the securities
to be changed by CUSIP, name of security, new price or rate to be applied,
and, if applicable, the time period for which the new price(s) is/are
effective.
4. Changes in Accounting Procedures
Any resolution passed by the Board of Trustees that affects accounting
practices and procedures under this Agreement shall be implemented by USBFS
effective upon written receipt and acceptance by USBFS.
5. Changes in Equipment, Systems, Service, Etc.
USBFS reserves the right to make reasonable changes from time to time, as
it deems advisable, relating to its services, systems, programs, rules,
operating schedules and equipment, so long as such changes do not adversely
affect the service provided to the Trust under this Agreement.
6. Compensation
USBFS shall be compensated for providing the services set forth in this
Agreement in accordance with the fee schedule set forth on Exhibit B hereto
(as amended from time to time). The Trust shall pay all fees and
reimbursable expenses within thirty (30) calendar days following receipt of
the billing notice, except for any fee or expense subject to a good faith
dispute. The Trust shall, in good faith, notify USBFS in writing within
thirty (30) calendar days following receipt of each invoice if the Trust is
disputing any amounts set forth on such invoice. The Trust shall pay such
disputed amounts within ten (10) calendar days after the parties agree upon
the amount to be paid. With the exception of any fee or expense the Trust
is disputing in good faith as set forth above, unpaid invoices shall accrue
a finance charge of one and one-half percent (1 1/2%) per month, after the
expiration of said 30 days from the Trust's receipt of the invoice until
fully paid. . Notwithstanding anything to the contrary, amounts owed by the
Trust to USBFS shall only be paid out of the assets and property of the
particular Fund involved.
7. Indemnification; Limitation of Liability
A. USBFS shall exercise reasonable care in the performance of its duties
under this Agreement. USBFS shall not be liable for any error of
judgment or mistake of law or for any loss suffered by the Trust in
connection with matters to which this Agreement relates, including
losses resulting from mechanical breakdowns or the failure of
communication or power supplies beyond USBFS's control, except a loss
arising out of or relating to USBFS's refusal or failure to comply
with the terms of this Agreement or from bad faith, negligence, or
willful misconduct on its part in the performance of its duties under
this Agreement. Notwithstanding any other provision of this Agreement,
if USBFS has acted in good faith, exercised reasonable care and not
engaged in willful misconduct on its part in the performance of its
duties under this Agreement, the Trust shall indemnify and hold
harmless USBFS from and against any and all claims, demands, losses,
expenses, and liabilities of any and every nature (including
reasonable attorneys' fees) that USBFS may sustain or incur or that
may be asserted against USBFS by any person arising out of any action
taken or omitted to be taken by it in performing the services
hereunder, except for any and all claims, demands, losses, expenses,
and liabilities arising out of or relating to USBFS's refusal or
failure to comply with the terms of this Agreement or from bad faith,
negligence or from willful misconduct on its part in performance of
its duties under this Agreement, (i) in accordance with the foregoing
standards, or (ii) in reliance upon any written or oral instruction
provided to USBFS by any duly authorized officer of the Trust, such
duly authorized officer to be included in a list of authorized
officers furnished to USBFS and as amended from time to time in
writing by resolution of the Board of Trustees.
USBFS shall indemnify and hold the Trust harmless from and against any
and all claims, demands, losses, expenses, and liabilities of any and
every nature (including reasonable attorneys' fees) which the Trust
may sustain or incur or which may be asserted against the Trust by any
person arising out of any action taken or omitted to be taken by USBFS
as a result of USBFS's refusal or failure to comply with the terms of
this Agreement, its bad faith, negligence, or willful misconduct.
Without limiting the generality of the foregoing, USBFS agrees to
indemnify the Trust with respect to any and all of the following: (1)
failure of USBFS to observe or perform any duty or obligation under
any party software license agreement or third party service; (2) any
claim(s) of infringement of any patent, copyright, trade secret, or
other proprietary right of any third party alleged to occurred because
of systems, software or other resources provided by USBFS (3) any
claim by a third party or arising from a breach of a duty of
confidentiality or other similar duty in respect of information in the
possession of USBFS which information was provided to the Trust; (4)
any claims arising out of to occurrences which USBFS is required to
insure against to this Agreement or applicable law; (5) any claim of
unlawful harassment or discrimination resulting from an action of
USBFS or its employees, agents or representatives; (6) any claim or
action arising out of or relating to any illness, other injury or
death of a person, or damage to property, attributable to the
negligence or misconduct of USBFS or its employees, agents or
representatives.
In order that the indemnification provisions contained in this section
shall apply, it is understood that if in any case USBFS may be asked
to indemnify or hold the Trust harmless, the Trust shall be fully and
promptly advised of all pertinent facts concerning the situation in
question, and it is further understood that the Trust will use all
reasonable care to notify USBFS promptly concerning any situation
which presents or appears likely to present the probability of such a
claim for indemnification against USBFS. USBFS shall have the option
to defend the Trust against any claim, which may be the subject of
this indemnification. In the event that USBFS so elects, it will so
notify the Trust and thereupon USBFS shall take over complete defense
of the claim, and the Trust shall in such situation initiate no
further legal or other expenses for which it shall seek
indemnification under this section. However, the Trust may, at its
sole option, participate in, but not control, the defense of the
claim, which participation shall be at its sole cosot and expense. The
Trust shall in no case confess any claim or make any compromise in any
case in which USBFS will be asked to indemnify the Trust except with
USBFS' prior written consent. Additionally, USBFS shall in no case
confess any lcaim or make any compromise in any case in which USBFS
will be asked to indemnify the Trust if such compromise does not
include a complete and unconditional release of the Trust.
In the event of a mechanical breakdown or failure of communication or
power supplies beyond its control, USBFS shall take all reasonable
steps to minimize service interruptions for any period that such
interruption continues beyond USBFS's control. USBFS will make every
reasonable effort to restore any lost or damaged data and correct any
errors resulting from such a breakdown at the expense of USBFS. USBFS
agrees that it shall, at all times, have reasonable contingency plans
with appropriate parties, making reasonable provision for emergency
use of electrical data processing equipment. Representatives of the
Trust shall be entitled to inspect USBFS's premises and operating
capabilities at any time during regular business hours of USBFS, upon
reasonable notice to USBFS.
Notwithstanding the above, USBFS reserves the right to reprocess and
correct administrative errors at its own expense.
B. In order that the indemnification provisions contained in this section
shall apply, it is understood that if in any case the Trust may be
asked to indemnify or hold USBFS harmless, the Trust shall be fully
and promptly advised of all pertinent facts concerning the situation
in question, and it is further understood that USBFS will use all
reasonable care to notify the Trust promptly concerning any situation
that presents or appears likely to present the probability of a claim
for indemnification. The Trust shall have the option to defend USBFS
against any claim that may be the subject of this indemnification. In
the event that the Trust so elects, it will so notify USBFS and
thereupon the Trust shall take over complete defense of the claim, and
USBFS shall in such situation initiate no further legal or other
expenses for which it shall seek indemnification under this section.
However, USBFS may, at is sole option, participate in, but not
control, the defense of the claim, which participation shall be at is
sole cost and expense. USBFS shall in no case confess any claim or
make any compromise in any case in which the Trust will be asked to
indemnify USBFS except with the Trust's prior written consent.
Additionally, the Trust shall in no case confess any c laim or make
any comrposime in any case in which the Trust will be asked to
indemnify USBFS if such compromise does not include a complete and
unconditional release of USBFS.
8. Proprietary and Confidential Information
USBFS agrees on behalf of itself and its directors, officers, and employees
to treat confidentially and as proprietary information of the Trust all
records and other information relative to the Trust including prior,
present, or potential shareholders of the Trust (and clients of said
shareholders), and not to use such records and information for any purpose
other than the performance of its responsibilities and duties hereunder,
except after prior notification to and approval in writing by the Trust,
which approval shall not be unreasonably withheld and may not be withheld
where USBFS 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 Trust.
Further, USBFS will adhere to the privacy policies adopted by the Trust
pursuant to Title V of the Xxxxxx-Xxxxx-Xxxxxx Act, as may be modified from
time to time (the "Act"). Notwithstanding the foregoing, USBFS will not,
directly or indirectly through an affiliate, disclose any nonpublic
personal information received from the Trust concerning any of the Trust's
shareholders to any third party or person that is not affiliated with the
Trust or with USBFS unless specifically directed by the Trust or allowed
under one of the exceptions noted under the Act, and provided that any such
information disclosed to an affiliate of USBFS shall be under the same
limitations on non-disclosure.
9. Term of Agreement; Amendment
This Agreement shall become effective as of the date first written above
and will continue in effect for a period of three years. Subsequent to the
initial three-year term, this Agreement may be terminated, without the
payment of any penalty, by either party upon giving ninety (90) days prior
written notice to the other party or such shorter period as is mutually
agreed upon by the parties. However, this Agreement may be amended by
mutual written consent of the parties.
10. Records
USBFS shall keep records relating to the services to be performed hereunder
in the form and manner, and for such period, as it may deem advisable and
is agreeable to the Trust, but not inconsistent with the rules and
regulations of appropriate government authorities, in particular, Section
31 of the 1940 Act and the rules thereunder. USBFS agrees that all such
records prepared or maintained by USBFS relating to the services to be
performed by USBFS hereunder are the property of the Trust and will be
preserved, maintained, and made available in accordance with such
applicable sections and rules of the 1940 Act and will be promptly
surrendered to the Trust on and in accordance with its request.
11. Counterparts
This Agreement may be executed in any number of counterparts, each of which
shall be deemed to be an original agreement but all of which counterparts
shall together constitute but one and the same instrument.
12. Governing Law
This Agreement shall be construed in accordance with the laws of the State
of Wisconsin, without regard to conflicts of law principles. To the extent
that the applicable laws of the State of Wisconsin, or any of the
provisions herein, conflict with the applicable provisions of the 1940 Act,
the latter shall control, and nothing herein shall be construed in a manner
inconsistent with the 1940 Act or any rule or order of the SEC thereunder.
13. Duties in the Event of Termination
In the event that, in connection with termination, a successor to any of
USBFS's duties or responsibilities hereunder is designated by the Trust by
written notice to USBFS, USBFS will promptly, upon such termination and at
the reasonable expense of the Trust, transfer to such successor all
relevant books, records, correspondence and other data established or
maintained by USBFS under this Agreement in a form reasonably acceptable to
the Trust (if such form differs from the form in which USBFS has maintained
the same, the Trust shall pay any reasonable expenses associated with
transferring the same to such form), and will cooperate in the transfer of
such duties and responsibilities, including provision for assistance from
USBFS's personnel in the establishment of books, records and other data by
such successor.
14. No Agency Relationship
Nothing herein contained shall be deemed to authorize or empower USBFS to
act as agent for the other party to this Agreement, or to conduct business
in the name, or for the account, of the other party to this Agreement.
15. Data Necessary to Perform Services
The Trust or its agent, shall furnish to USBFS the data necessary to
perform the services described herein at such times and in such form as
mutually agreed upon. If USBFS is also acting in another capacity for the
Trust, nothing herein shall be deemed to relieve USBFS of any of its
obligations in such capacity.
16. Notification of Error
The Trust will notify USBFS of any discrepancy between USBFS and the Trust,
including, but not limited to, failing to account for a security position
in a Fund's portfolio, by the later of: within three (3) business days
after receipt of any reports rendered by USBFS to the Trust; within three
(3) business days after discovery of any error or omission not covered in
the balancing or control procedure, or within three (3) business days of
receiving notice from any shareholder.
17. Assignment
This Agreement, and any right or obligation hereunder, may not be assigned
by either party without the prior written consent of the other party.
18. Notices
Any notice required or permitted to be given by either party to the other
shall be in writing and shall be deemed to have been given on the date
delivered personally or by courier service, or three (3) days after sent by
registered or certified mail, postage prepaid, return receipt requested, or
on the date sent and confirmed received by facsimile transmission to the
other party's address set forth below:
Notice to USBFS shall be sent to:
U.S. Bancorp Fund Services, LLC
000 Xxxx Xxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
and notice to the Trust shall be sent to:
Fort Pitt Capital Funds
Xxxxxx Plaza Eleven
000 Xxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
with a copy to:
Xxxx Xxxxx, LLC
Attention: Xxxxx Xxxxx
00 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxxxx, XX 00000
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by a duly authorized officer on one or more counterparts as of the date
first above written.
Fort Pitt Capital FUnds U.S. BANCORP FUND SERVICES, LLC
By:/s/ Xxxxxx X. Xxxxxx By: /s/ Xxx Xxxxxxx
-------------------- ------------------
Xxxxxx X. Xxxxxx Xxx Xxxxxxx
Title: President Title: Senior Vice President
