INVESTMENT COMPANY SERVICES AGREEMENT
MONTEAGLE FUNDS
This Agreement, dated as of the 1st day of May 2009, by and between the
Monteagle Funds (the "Trust" or "Funds"), a business trust operating as an
open-end, investment management company registered under the Investment Company
Act of 1940, as amended (the "Act"), duly organized and existing under the laws
of the State of Delaware and Matrix Capital Group, Inc. ("Matrix"), a
corporation duly organized under the laws of the State of New York
(collectively, the "Parties").
WITNESSETH THAT:
WHEREAS, the Trust is authorized by its Agreement and Declaration of Trust
and By-Laws to issue separate series of shares representing interests in
separate investment portfolios which are identified on Schedule "C" attached
hereto (the "Portfolios") and which Schedule "C" may be amended from time to
time by mutual agreement of the Trust and Matrix; and
WHEREAS, the Parties desire to enter into an agreement whereby Matrix will
provide the services to the Portfolios as specified herein and set forth in
particular in Schedule "A" which is attached hereto and made a part hereof.
NOW THEREFORE, in consideration of the premises and mutual covenants
contained herein, and in exchange of good and valuable consideration, the
sufficiency and receipt of which are hereby acknowledged, the Parties hereto,
intending to be legally bound, do hereby agree as follows:
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GENERAL PROVISIONS
Section 1. Appointment.
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The Trust hereby appoints Matrix as servicing agent to the Portfolios and Matrix
hereby accepts such appointment. In order that Matrix may perform its duties
under the terms of this Agreement, the Board of Trustees of the Trust shall
direct the officers, investment adviser, legal counsel, independent accountants
and custodian of the Trust to cooperate fully with Matrix and, upon request of
Matrix, to provide such information, documents and advice relating to the Trust
which Matrix requires to execute its responsibilities hereunder. In connection
with its duties, Matrix shall be entitled to rely, and will be held harmless by
the Trust when acting in reasonable reliance, upon any instruction, advice or
document relating to the Trust as provided to Matrix by any of the
aforementioned persons on behalf of the Trust. All fees charged by any such
persons acting on behalf of the Trust would be deemed an expense of the Trust.
Any services performed by Matrix under this Agreement will conform to the
requirements of:
(a) the provisions of the Act and the Securities Act of 1933, as amended,
and any rules or regulations in force thereunder;
(b) any other applicable provision of state and federal law;
(c) the provisions of the Declaration of Trust and the By-Laws of the
Trust as amended from time to time and delivered to Matrix;
(d) any policies and determinations of the Board of Trustees of the Trust
which are communicated to Matrix; and
(e) the policies of the Trust as reflected in the Trust's registration
statement as filed with the U.S. Securities and Exchange Commission.
Nothing in this Agreement will prevent Matrix or any officer thereof from
providing the same or
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comparable services for or with any other person, trust, firm or corporation.
While the services supplied to the Trust may be different than those supplied to
other persons, trusts, firms or corporations, Matrix will provide the Trust
equitable treatment in supplying services. The Trust recognizes that it will not
receive preferential treatment from Matrix as compared with the treatment
provided to other Matrix clients.
Section 2. Duties and Obligations of Matrix.
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Subject to the provisions of this Agreement, Matrix will provide to the Trust
the specific services as set forth in Schedule "A" attached hereto.
Section 3. Definitions. For purposes of this Agreement:
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"CERTIFICATE" will mean any notice, instruction, or other instrument in
writing, authorized or required by this Agreement. To be effective, such
Certificate shall be given to and received by the custodian and shall be
signed on behalf of the Trust by any two of its designated officers, and
the term Certificate shall also include instructions communicated to the
custodian by Matrix.
"CUSTODIAN" will refer to that agent which provides safekeeping of the
assets of the Trust.
"INSTRUCTIONS" will mean communications containing instructions
transmitted by electronic or telecommunications media including, but not
limited to, Industry Standardization for Institutional Trade
Communications, computer-to-computer interface, dedicated transmission
line, facsimile transmission (which may be signed by an officer or
unsigned) and tested telex.
"ORAL INSTRUCTION" will mean an authorization, instruction, approval, item
or set of data, or
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information of any kind transmitted to Matrix in person or by telephone,
telegram, telecopy or other mechanical or documentary means LACKING
ORIGINAL SIGNATURE, by a person or persons reasonably identified to Matrix
to be a person or persons so authorized by a resolution of the Board of
Trustees of the Trust to give Oral Instructions to Matrix on behalf of the
Trust.
"SHAREHOLDERS" will mean the registered owners of the shares of the Trust
in accordance with the share registry records maintained by Matrix for the
Trust.
"SHARES" will mean the issued and outstanding shares of the Trust.
"SIGNATURE GUARANTEE" will mean the guarantee of signatures by an
"eligible guarantor institution" as defined in Rule 17Ad-15 under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"). Eligible
guarantor institutions include banks, brokers, dealers, credit unions, and
national securities exchanges, registered securities associations,
clearing agencies and savings associations. Broker-dealers guaranteeing
signatures must be members of a clearing corporation or maintain net
capital of at least $100,000. Signature guarantees will be accepted from
any eligible guarantor institution, which participates in a signature
guarantee program.
"WRITTEN INSTRUCTION" will mean an authorization, instruction, approval,
item or set of data or information of any kind transmitted to Matrix in an
original writing containing an original signature or a copy of such
document transmitted by telecopy including transmission of such signature
reasonably identified to Matrix to be the signature of a person or persons
so authorized by a resolution of the Board of Trustees of the Trust, or so
identified by the Trust to give Written Instructions to Matrix on behalf
of the Trust.
CONCERNING ORAL AND WRITTEN INSTRUCTIONS For all purposes under this
Agreement,
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Matrix is authorized to act upon receipt of the first of any Written or
Oral Instruction it receives from the Trust or its agents. In cases where
the first instruction is an Oral Instruction that is not in the form of a
document or written record, a confirmatory Written Instruction or Oral
Instruction in the form of a document or written record shall be delivered
promptly. In cases where Matrix receives an Instruction, whether Written
or Oral, to enter a portfolio transaction onto the Trust's records, the
Trust shall cause the broker/dealer executing such transaction to send a
written confirmation to the Custodian. Matrix shall be entitled to rely on
the first Instruction received from the Trust or its authorized agents,
whether Oral or otherwise. For any act or omission undertaken by Matrix in
compliance therewith, it shall be free of liability and fully indemnified
and held harmless by the Trust, provided however, that in the event any
Instruction received by Matrix is countermanded by a subsequent Written or
Oral Instruction received prior to acting upon such countermanded
Instruction, Matrix shall act upon such subsequent Written or Oral
Instruction. The sole obligation of Matrix with respect to any follow-up
or confirmatory Written Instruction or Oral Instruction in documentary or
written form shall be to make reasonable efforts to detect any discrepancy
between the original Instruction and such follow-up or confirmatory
Written or Oral Instruction, and to report such discrepancy to the Trust.
The Trust shall be responsible and bear the expense of its taking any
action, including any reprocessing, necessary to correct any discrepancy
or error. To the extent such action requires Matrix to act; the Trust
shall give Matrix specific Written Instruction as to the action required.
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The Trust will file with Matrix a certified copy of each resolution of the
Trust's Board of Trustees authorizing execution of Written Instructions or
the transmittal of Oral Instructions as provided above.
Section 4. Indemnification.
---------------------------
(a) Matrix, its officers, employees, shareholders, and agents will be
liable for any loss suffered by the Trust resulting from the willful
misfeasance, bad faith, negligence or reckless disregard on the part of
Matrix in the performance of its obligations and duties under this
Agreement.
(b) Any director, officer, employee, shareholder or agent of Matrix, who
may be or become an officer, director, employee or agent of the Trust,
will be deemed, when rendering services to the Trust, or acting on any
business of the Trust (other than services or business in connection with
Matrix's duties hereunder), to be rendering such services to or acting
solely for the Trust and not as a director, officer, employee, shareholder
or agent of, or under the control or direction of Matrix even though such
person may be receiving compensation from Matrix.
(c) To the extent permitted under the Act, The Trust agrees to indemnify
and hold Matrix harmless, together with its officers, employees,
shareholders and agents from and against any and all claims, demands,
expenses and liabilities (whether with or without basis in fact or law) of
any and every nature which Matrix may sustain or incur or which may be
asserted against Matrix by any person by reason of, or as a result of:
(i) any action taken or omitted to be taken by Matrix except
claims, demands, expenses and liabilities arising in whole or
in part from willful
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misfeasance, bad faith, negligence or reckless disregard on
the part of Matrix in the performance of its obligations and
duties under this Agreement; or
(ii) any action taken or omitted to be taken by Matrix in reliance
upon any Certificate, instrument, order or stock certificate
or other document reasonably believed by Matrix to be genuine
and signed, countersigned or executed by any duly authorized
person, upon the Oral Instructions or Written Instructions of
an authorized person of the Trust, or upon the written opinion
of legal counsel for the Trust or Matrix; or
(iii) the offer or sale of shares of the Trust to any person,
natural or otherwise, which is in violation of any state or
federal law.
If a claim is made against Matrix as to which Matrix may seek indemnity under
this Section, Matrix will notify the Trust promptly after receipt of any written
assertion of such claim threatening to institute an action or proceeding with
respect thereto and will notify the Trust promptly of any action commenced
against Matrix within ten (10) days after Matrix has been served with a summons
or other legal process. Failure to notify the Trust will not, however, relieve
the Trust from any liability, which it may have on account of the indemnity
under this Section so long as the Trust has not been prejudiced in any material
respect by such failure.
The Trust and Matrix will cooperate in the control of the defense of any action,
suit or proceeding in which Matrix is involved and for which indemnity is being
provided by the Trust to Matrix. The Trust may negotiate the settlement of any
action, suit or proceeding subject to Matrix's
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approval, which will not be unreasonably withheld. Matrix reserves the right,
but not the obligation, to participate in the defense or settlement of a claim,
action or proceeding with its own counsel. Costs or expenses incurred by Matrix
in connection with, or as a result of such participation, will be borne solely
by the Trust if:
(i) Matrix has received an opinion of counsel from counsel to the
Trust stating that the use of counsel to the Trust by Matrix
would present an impermissible conflict of interest;
(ii) the defendants in, or targets of, any such action or
proceeding include both Matrix and the Trust, and legal
counsel to Matrix has reasonably concluded that there are
legal defenses available to it which are different from or
additional to those available to the Trust or which may be
adverse to or inconsistent with defenses available to the
Trust (in which case the Trust will not have the right to
direct the defense of such action on behalf of Matrix); or
(iii) the Trust authorizes Matrix to employ separate counsel at the
expense of the Trust.
(d) The terms of this Section will survive the termination of this
Agreement.
Section 5. Representations and Warranties.
------------------------------------------
(a) Matrix represents and warrants that:
(i) it is a corporation duly organized and existing and in good
standing under the laws of New York;
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(ii) it is empowered under applicable laws and by its Certificate
of Incorporation and By-Laws to enter into and perform this
Agreement;
(iii) all requisite corporate proceedings have been taken to
authorize Matrix to enter into and perform this Agreement;
(iv) it has and will continue to have access to the facilities,
personnel and equipment required to fully perform its duties
and obligations hereunder;
(v) no legal or administrative proceedings have been instituted or
threatened which would impair Matrix's ability to perform its
duties and obligations under this Agreement;
(vi) its entrance into this Agreement shall not cause a material
breach or be in material conflict with any other agreement or
obligation of Matrix or any law or regulation applicable to
it;
(vii) it is registered as a transfer agent under Section 17A(c) (2)
of the Exchange Act and has adopted compliance policies and
procedures reasonably designed to ensure its compliance with
federal securities laws;
(viii) this Agreement has been duly authorized by Matrix and, when
executed and delivered, will constitute a valid, legal and
binding obligation of Matrix, enforceable in accordance with
its terms.
(b) The Trust represents and warrants that:
(i) it is a statutory trust duly organized and existing and in
good standing under the laws of the State of Delaware;
(ii) it is empowered under applicable laws and by its Agreement and
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Declaration of Trust and By-Laws to enter into and perform
this Agreement;
(iii) all requisite proceedings have been taken to authorize the
Trust to enter into and perform this Agreement;
(iv) no legal or administrative proceedings have been instituted or
threatened which would impair the Trust's ability to perform
its duties and obligations under this Agreement;
(v) the Trust's entrance into this Agreement shall not cause a
material breach or be in material conflict with any other
agreement or obligations of the Trust, or any law or
regulation applicable to either;
(vi) the Shares are properly registered or otherwise authorized for
issuance and sale;
(vii) this Agreement has been duly authorized by the Trust and, when
executed and delivered, will constitute a valid, legal and
binding obligation of the Trust, enforceable in accordance
with its terms.
(c) Delivery of Documents
The Trust will furnish or cause to be furnished to Matrix the
following documents;
(i) current Prospectus and Statement of Additional Information for
each Portfolio;
(ii) most recent Annual Report of each Portfolio;
(iii) most recent Semi-Annual Report for of each Portfolio;
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(iv) certified copies of resolutions of the Trust's Board of
Trustees authorizing the execution of Written Instructions or
the transmittal of Oral Instructions and those persons
authorized to give those Instructions.
(d) Record Keeping and Other Information
Matrix will create and maintain all records required of it pursuant to its
duties hereunder and as set forth in Schedule "A" in accordance with all
applicable laws, rules and regulations, including records required by
Section 31(a) of the Act. All such records will be the property of the
Trust and will be available during regular business hours for inspection,
copying and use by the Trust. Where applicable, such records will be
maintained by Matrix for the periods and in the places required by Rule
31a-2 under the Act. Upon termination of this Agreement, Matrix will
deliver all such records to the Trust or such person as the Trust may
designate.
SECTION 6. COMPENSATION. The Trust agrees to pay Matrix compensation for its
services, and to reimburse it for expenses at the rates, times, manner and
amounts as set forth in Schedule "B" attached hereto and incorporated herein by
reference and as will be set forth in any amendments to such Schedule "B" agreed
upon in writing by the Parties. Upon receipt and approval of an invoice
therefor, Matrix is authorized to collect such fees by debiting the Trust's
custody account. The Trust will approve or contest any invoice sent by Matrix
within five (5) days of receipt. Disputed amounts shall not be deducted from the
Trust's custody account until the dispute is resolved. In addition, the Trust
agrees to reimburse Matrix for any reasonable and ordinary out-of-pocket
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expenses paid by Matrix on behalf of the Trust within five (5) calendar days of
the Trust's receipt of an invoice therefor. For the purpose of determining fees
payable to Matrix, the value of the Trust's net assets will be computed at the
times and in the manner specified in the Trust's Prospectus and Statement of
Additional Information then in effect. During the term of this Agreement, should
the Trust seek services or functions in addition to those outlined below or in
Schedule "A" attached hereto, a written amendment to this Agreement specifying
the additional services and corresponding compensation will be executed by the
Parties. In the event that the Trust is more than thirty (30) days delinquent in
its payments of monthly xxxxxxxx in connection with this Agreement (with the
exception of specific amounts, which may be contested in good faith by the
Trust), this Agreement may be terminated upon thirty (30) days' written notice
to the Trust by Matrix. In the event of a dispute over a billing amount, the
Trust must notify Matrix in writing of the contested amounts within a reasonable
time of receipt of a billing for such amounts. Disputed amounts are not due and
payable while they are being disputed.
Section 7. Days of Operation.
-----------------------------
Nothing contained in this Agreement is intended to or will require Matrix, in
any capacity hereunder, to perform any functions or duties on any day on which
the New York Stock Exchange ("NYSE") is closed. Functions or duties normally
scheduled to be performed on such days will be performed on and as of the next
succeeding business day on which the NYSE is open. Notwithstanding the
foregoing, Matrix will compute the net asset value of the Trust on each day
required pursuant to Rule 22c-1 promulgated under the Act.
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Section 8. Acts of God, etc.
----------------------------
Matrix will not be liable or responsible for delays or errors caused by acts of
God or by reason of circumstances beyond its control including, acts of civil or
military authority, national emergencies, equipment failures, insurrection, war,
riots, or failure or unavailability of transportation, communication or power
supply, fire, flood or other catastrophe. In the event of equipment failures
beyond Matrix's control, Matrix will, at no additional expense to the Trust,
take reasonable steps to minimize service interruptions but will have no
liability with respect thereto. The foregoing obligation will not extend to
computer terminals located outside of premises maintained by Matrix. Matrix has
entered into and agrees to maintain in effect agreements making reasonable
provision for emergency use of electronic data processing equipment to the
extent appropriate equipment are available.
Section 9. Inspection and Ownership of Records.
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In the event of a request or demand for the inspection of the records of the
Trust, Matrix will use its best efforts to notify the Trust and to secure
instructions as to permitting or refusing such inspection. Matrix may, however,
after notice to the Trust make such records available for inspection to any
person in any case where it is advised in writing by its counsel that it may be
held liable for failure to do so. Matrix recognizes that the records it
maintains for the Trust are the property of the Trust and will be surrendered to
the Trust upon written notice to Matrix as outlined under Section 10(c) below.
Matrix agrees to maintain the records and all other information of the Trust in
a confidential manner and will not use such information for any purpose other
than the performance of Matrix's duties under this Agreement.
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Section 10. Duration and Termination.
-------------------------------------
(a) The initial term of this Agreement will be for the period of two (2)
years, commencing on the date hereinabove first written (the "Effective
Date") and will continue thereafter subject to termination by either Party
as set forth in subsection (c) below.
(b) The fee schedules set forth in Schedule "B" attached hereto will be
fixed for the initial term commencing on the Effective Date of this
Agreement and will continue or be revised thereafter subject mutual
agreement of the Parties.
(c) After the initial term of this Agreement, a Party may give written
notice to the other (the day on which the notice is received by the Party
against which the notice is made shall be the "Notice Date") of a date on
which this Agreement shall be terminated ("Termination Date"). The
Termination Date shall be set on a day not less than ninety (90) days
after the Notice Date. The period of time between the Notice Date and the
Termination Date is hereby identified as the "Notice Period". Any time up
to, but not later than fifteen (15) days prior to the Termination Date,
the Trust will pay to Matrix such compensation as may be due as of the
Termination Date and will likewise reimburse Matrix for any out-of-pocket
expenses and disbursements reasonably incurred or expected to by incurred
by Matrix up to and including the Termination Date.
(d) In connection with the termination of this Agreement, if the Trust
designates, by written notice to Matrix a successor to any of Matrix's
duties or responsibilities under this Agreement, Matrix will promptly on
the Termination Date, transfer to the successor all records which belong
to the Trust and will provide appropriate, reasonable and
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professional cooperation in transferring such records to the named
successor. The Trust shall reimburse Matrix for its reasonable
out-of-pocket expenses incurred in connection with the transfer of such
records in accordance with section 10(c) above.
(e) Should the Trust desire to move any of the services outlined in this
Agreement to a successor service provider prior to the Termination Date,
Matrix shall make a good faith effort to facilitate the conversion on such
prior date, however, there can be no guarantee that Matrix will be able to
facilitate a conversion of services prior to the end of the Notice Period.
Should services be converted to a successor service provider prior to the
end of the Notice Period, or if the Trust is liquidated and its assets
merged or purchased or the like with another entity, payment of fees to
Matrix shall be accelerated to the last business day prior to the
conversion or termination of services and calculated as if the services
had remained at Matrix until the expiration of the Notice Period and shall
be calculated at the asset levels on the last business day prior to
conversion or termination.
(f) Notwithstanding any other provisions of Paragraph 10, if the Trust is
liquidated and not merged or purchased, fees shall be paid through the
liquidation date; in the event the Trust deregisters as an Investment
Company with the United States Securities and Exchange Commission ("SEC"),
or liquidates a Portfolio this Agreement may be terminated by the Trust
upon thirty (30) days written notice to Matrix. The Termination Date shall
be thirty (30) days after the receipt of such notice by Matrix. Any time
up to, but not later than ten (10) days prior to the Termination Date, the
Trust or applicable Portfolio will pay to Matrix such compensation as may
be due as of the Termination Date and will likewise reimburse Matrix for
any out-of-pocket expenses and disbursements
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reasonably incurred or expected to be incurred by Matrix up to and
including the Termination Date.
(g) Notwithstanding the foregoing, this Agreement may be terminated at any
time by either Party in the event of a material breach by the other Party
involving gross negligence, willful misfeasance, bad faith or a reckless
disregard of its obligations and duties under this Agreement provided that
such breach shall have remained unremedied for sixty (60) days or more
after receipt of written specification thereof.
Section 11. Rights of Ownership.
--------------------------------
All computer programs and procedures developed to perform services required to
be provided by Matrix under this Agreement are the property of Matrix. All
records and other data except such computer programs and procedures are the
exclusive property of the Trust and all such other records and data will be
furnished to the Trust in appropriate form as soon as practicable after
termination of this Agreement for any reason.
Section 12. Amendments to Documents.
------------------------------------
The Trust will furnish Matrix written copies of any amendments to, or changes
in, the Declaration of Trust, By-Laws, Prospectus or Statement of Additional
Information in a reasonable time prior to such amendments or changes becoming
effective. In addition, the Trust agrees that no amendments will be made to the
Prospectus or Statement of Additional Information of the Trust which might have
the effect of changing the procedures employed by Matrix in providing the
services agreed to hereunder or which amendment might affect the duties of
Matrix hereunder
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unless the Trust first obtains Matrix's approval of such amendments or changes.
Section 13. Confidentiality.
----------------------------
Both Parties hereto agree that any non-public information obtained hereunder
concerning the other Party is confidential and may not be disclosed to any other
person without the consent of the other Party, except as may be required by
applicable law or at the request of the U.S. Securities and Exchange Commission
or other governmental agency. Matrix agrees that it will not use any non-public
information for any purpose other than performance of its duties or obligations
hereunder. The obligations of the Parties under this Section will survive the
termination of this Agreement. The Parties further agree that a breach of this
Section would irreparably damage the other Party and accordingly agree that each
of them is entitled, without bond or other security, to an injunction or
injunctions to prevent breaches of this provision.
Section 14. Notices.
--------------------
Except as otherwise provided in this Agreement, any notice or other
communication required by or permitted to be given in connection with this
Agreement will be in writing and will be delivered in person or sent by first
class mail, postage prepaid or by prepaid overnight delivery service to the
respective parties as follows:
IF TO THE TRUST: IF TO MATRIX:
---------------- -------------
Monteagle Funds Matrix Capital Group
000 Xxxxx Xxxxxx Xxxxx, Xxxxx 000 000 Xxxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxx, Xxxxxxxxx 00000 Xxx Xxxx, XX 00000-0000
Attention: Xxxx X. Xxxxxxx, Attention: Xxxxxxxxxxx X. Xxxx,
President President
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Section 15. Amendment.
----------------------
No provision of this Agreement may be amended or modified in any manner except
by a written agreement properly authorized and executed by the Parties. This
Agreement may be amended from time to time by supplemental agreement executed by
the Parties and the compensation stated in Schedule "B" attached hereto may be
adjusted accordingly as mutually agreed upon.
Section 16. Authorization.
--------------------------
The Parties represent and warrant to each other that the execution and delivery
of this Agreement by the undersigned officer of each Party has been duly and
validly authorized; and when duly executed, this Agreement will constitute a
valid and legally binding enforceable obligation of each Party.
Section 17. Counterparts.
-------------------------
This Agreement may be executed in two or more counterparts, each of which when
so executed will be deemed to be an original, but such counterparts will
together constitute but one and the same instrument.
Section 18. Assignment.
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This Agreement will extend to and be binding upon the Parties hereto and their
respective successors and assigns; provided, however, that this Agreement will
not be assignable by the
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Trust without the written consent of Matrix or by Matrix without the written
consent of the Trust which consent must be authorized or approved by a
resolution by its Board of Trustees prior to such assignment.
Section 19. Governing Law.
--------------------------
The laws of the State of Delaware will govern this Agreement.
Section 20. Severability.
-------------------------
If any part, term or provision of this Agreement is held by any court to be
illegal, in conflict with any law or otherwise invalid, the remaining portion or
portions will be considered severable and not be affected and the rights and
obligations of the parties will be construed and enforced as if the Agreement
did not contain the particular part, term or provision held to be illegal or
invalid, provided that the basic agreement is not thereby materially impaired.
Section 21. Limitation of Liability of the Trustees and Shareholders
--------------------------------------------------------------------
It is expressly agreed that the obligations of the Trust hereunder shall not be
binding upon any of the Trustees, shareholders, nominees, officers, agents or
employees of the Trust personally, but shall bind only the trust property of the
Trust as provided in the Trust's Agreement and Declaration of Trust. The
execution and delivery of this Agreement have been authorized by the Trustees
and this Agreement has been signed and delivered by an authorized officer of the
Trust, acting as such, and neither such authorization by the Trustees nor such
execution and delivery by such officer shall be deemed to have been made by any
of them individually or to impose any
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liability on any of them personally, bust shall bind only the trust property of
the Trust as provided in the Trust's Agreement and Declaration of Trust.
Section 22. Anti-Money Laundering
---------------------------------
Each of Matrix and the Trust acknowledge that it is a financial institution
subject to the USA Patriot Act of 2001 (the "AML Act"), which requires among
other things, that financial institutions adopt compliance programs to guard
against money laundering. Each represents and warrants to the other that it is
in compliance with and will continue to comply with the AML Act and applicable
regulations in all relevant respects. In that connection, the parties further
agree as follows:
(a) Matrix shall include specific contractual provisions regarding
anti-money laundering compliance obligations in all future agreements
entered into by Matrix with any financial intermediary that would be
authorized to effect transactions in shares of the Trust.
(b) Each of Matrix and the Trust agrees that it will take such further
steps, and cooperate with the others as may be reasonably necessary, to
facilitate compliance with the AML Act, including but not limited to the
provision of copies of its written procedures, policies and controls
related thereto ("AML Operations"). Matrix undertakes that it will grant
to the Trust, the Trust's anti-money laundering compliance officer and
regulatory agencies, reasonable access to copies of Matrix's AML
Operations, books and records pertaining to the Trust only.
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Section 23. Entire Agreement
----------------------------
This Agreement (including the Exhibits attached hereto) contains the entire
agreement and understanding of the parties with respect to the subject matter
hereof and supersedes all prior written or oral agreements and understandings
with respect thereto.
IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be signed
by their duly authorized officers as of the day and year first above written.
Monteagle Funds Matrix Capital Group
_____________________________ ___________________________________
By: Xxxx X. Xxxxxxx, President By: Xxxxxxxxxxx X. Xxxx, President
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SCHEDULE A
ACCOUNTING SERVICES PROVIDED BY MATRIX CAPITAL GROUP
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o JOURNALIZE EACH PORTFOLIO'S INVESTMENT, CAPITAL SHARE AND INCOME AND
EXPENSE ACTIVITIES.
o POST AND VERIFY INVESTMENT BUY/SELL TRADE TICKETS WHEN RECEIVED FROM THE
ADVISOR OR PORTFOLIO MANAGER.
o MAINTAIN INDIVIDUAL LEDGERS FOR INVESTMENT SECURITIES.
o MAINTAIN HISTORICAL TAX LOTS FOR EACH SECURITY.
o RECONCILE CASH AND INVESTMENT BALANCES OF EACH PORTFOLIO WITH THE
CUSTODIAN, AND PROVIDE THE ADVISOR WITH THE BEGINNING CASH BALANCE
AVAILABLE FOR INVESTMENT PURPOSES.
o UPDATE THE CASH AVAILABILITY THROUGHOUT THE DAY AS REQUIRED BY THE
ADVISOR.
o POST TO AND PREPARE EACH PORTFOLIO'S STATEMENT OF ASSETS AND LIABILITIES
AND STATEMENT OF OPERATIONS.
o CALCULATE EXPENSES PAYABLE PURSUANT TO THE TRUST'S VARIOUS CONTRACTUAL
OBLIGATIONS.
o CONTROL ALL DISBURSEMENTS FROM THE TRUST ON BEHALF OF EACH PORTFOLIO AND
AUTHORIZE SUCH DISBURSEMENTS UPON INSTRUCTIONS OF THE TRUST.
o CALCULATE CAPITAL GAINS AND LOSSES.
o DETERMINE EACH PORTFOLIO'S NET INCOME.
o AT THE PORTFOLIO'S EXPENSE, OBTAIN SECURITY MARKET PRICES OR IF SUCH
MARKET PRICES ARE NOT READILY AVAILABLE, THEN OBTAIN SUCH PRICES FROM
SERVICES APPROVED BY THE ADVISOR, AND IN EITHER CASE CALCULATE THE MARKET
OR FAIR VALUE OF EACH PORTFOLIO'S INVESTMENTS.
o WHERE APPLICABLE, CALCULATE THE AMORTIZED COST VALUE OF DEBT INSTRUMENTS.
o TRANSMIT OR MAIL A COPY OF THE PORTFOLIO VALUATIONS TO THE ADVISOR.
o COMPUTE THE NET ASSET VALUE OF EACH PORTFOLIO AND EACH SHARE CLASS ON A
DAILY BASIS EACH DAY OR PARTIAL DAY THAT THE NEW YORK STOCK EXCHANGE IS
OPEN FOR BUSINESS OR AS OTHERWISE REQUIRED UNDER THE TRUST'S PROSPECTUS OR
THE 1940 ACT.
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o REPORT APPLICABLE NET ASSET VALUE AND PERFORMANCE DATA TO PERFORMANCE
TRACKING ORGANIZATIONS.
o COMPUTE EACH PORTFOLIO'S AND EACH SHARE CLASS' YIELDS, TOTAL RETURN,
BEFORE AND AFTER TAXES AND ADJUSTED FOR SALES LOAD, EXPENSE RATIOS AND
PORTFOLIO TURNOVER RATE.
o PREPARE AND MONITOR THE EXPENSE ACCRUALS AND NOTIFY FUND MANAGEMENT OF ANY
PROPOSED ADJUSTMENTS.
o PREPARE MONTHLY SECURITY TRANSACTIONS LISTINGS.
o PREPARE MONTHLY BROKER SECURITY TRANSACTIONS SUMMARIES.
o SUPPLY VARIOUS FUND AND PORTFOLIO STATISTICAL DATA TO THE TRUST AND ITS
INVESTMENT ADVISER AS REQUESTED ON AN ONGOING BASIS.
o ASSIST IN THE PREPARATION OF SUPPORT SCHEDULES NECESSARY FOR COMPLETION OF
FEDERAL AND STATE TAX RETURNS.
o ASSIST IN THE PREPARATION AND FILING OF THE TRUST'S ANNUAL, SEMIANNUAL OR
QUARTERLY REPORTS WITH THE SEC ON FORM N-SAR, N-CSR AND FORM N-Q.
o ASSIST IN THE PREPARATION AND FILING OF THE TRUST'S ANNUAL AND SEMIANNUAL
REPORTS TO SHAREHOLDERS AND PROXY STATEMENTS.
o ASSIST WITH THE PREPARATION OF AMENDMENTS TO THE TRUST'S REGISTRATION
STATEMENTS ON FORM N-1A AND OTHER FILINGS RELATING TO THE REGISTRATION OF
SHARES.
o MONITOR EACH PORTFOLIO'S STATUS AS A REGULATED INVESTMENT COMPANY UNDER
SUBCHAPTER M OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED FROM TIME TO
TIME ("CODE").
o DETERMINE THE AMOUNT OF DIVIDENDS AND OTHER DISTRIBUTIONS PAYABLE TO
SHAREHOLDERS AS NECESSARY TO, AMONG OTHER THINGS; MAINTAIN THE
QUALIFICATION AS A REGULATED INVESTMENT COMPANY OF EACH PORTFOLIO OF THE
TRUST UNDER THE CODE.
o PROVIDE OTHER ACCOUNTING SERVICES AS MAY BE AGREED UPON FROM TIME TO TIME
IN WRITING BY THE TRUST AND MATRIX.
o MONITOR PORTFOLIO TRANSACTIONS FOR COMPLIANCE WITH PORTFOLIO RESTRICTIONS
OF THE '40 ACT AND THE TRUST'S REGISTRATION STATEMENT; AND IMMEDIATELY
NOTIFY THE ADVISER OF ANY VIOLATIONS.
23
ADMINISTRATIVE SERVICES PROVIDED BY MATRIX CAPITAL GROUP
--------------------------------------------------------------------------------
o PROVIDE OVERALL DAY-TO-DAY FUND ADMINISTRATIVE MANAGEMENT, INCLUDING
COORDINATION OF INVESTMENT ADVISOR, CUSTODIAN, AUDITOR TRANSFER AGENCY,
DISTRIBUTION AND PRICING, PRINTING AND ACCOUNTING SERVICES.
o ASSIST IN THE PREPARATION OF FILING OF ALL FEDERAL AND STATE REPORTS
INCLUDING:
o FUND'S POST-EFFECTIVE AMENDMENTS UNDER THE SECURITIES ACT OF 1933
AND THE INVESTMENT COMPANY ACT OF 1940.
o FORM N-SAR - SEMI-ANNUAL REPORT FOR REGISTERED INVESTMENT COMPANIES.
o FORM N-CSR - CERTIFIED SHAREHOLDER REPORT.
o FORM N-Q - QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS
o RULE 17G-1 FILING WITH THE SEC REGARDING FIDELITY BOND COVERAGE.
o FORM 24F-2 - ANNUAL NOTICE OF SECURITIES SOLD PURSUANT TO RULE
24F-2.
o FORM N-PX - PROXY VOTING REPORT.
o ONGOING MONITORING OF STATE BLUE SKY REGISTRATIONS AND FILINGS WITH
APPLICABLE STATES.
o PREPARE AND FILE SUCH REPORTS, APPLICATIONS AND DOCUMENTS AS MAY BE
NECESSARY OR DESIRABLE TO REGISTER THE TRUST'S SHARES WITH THE FEDERAL AND
STATE SECURITIES AUTHORITIES, AND MONITOR THE SALE OF FUND SHARES FOR
COMPLIANCE WITH FEDERAL AND STATE SECURITIES LAWS.
o PREPARE AND FILE REPORTS TO SHAREHOLDERS, INCLUDING THE ANNUAL AND
SEMI-ANNUAL REPORT TO SHAREHOLDERS; AND COORDINATE MAILING PROSPECTUSES,
NOTICES, PROXY STATEMENTS, PROXIES AND OTHER REPORTS TO SHAREHOLDERS.
o ASSIST WITH LAYOUT AND PRINTING OF SHAREHOLDER COMMUNICATIONS, INCLUDING
PROSPECTUSES AND REPORTS TO SHAREHOLDERS.
o ADMINISTER CONTRACTS ON BEHALF OF THE TRUST WITH, AMONG OTHERS, THE
TRUST'S INVESTMENT ADVISOR, CUSTODIAN, TRANSFER AGENT/SHAREHOLDER
SERVICING AGENT, DISTRIBUTOR, AND ACCOUNTING SERVICES AGENT.
24
o ASSIST FUND'S LEGAL COUNSEL IN THE PREPARATION FOR TRUSTEES/MANAGEMENT
MEETINGS INCLUDING, COORDINATING THE AGENDA, DISTRIBUTION OF MINUTES,
ATTENDANCE RECORDS AND MINUTE BOOKS.
o COORDINATE SHAREHOLDER MEETINGS, INCLUDING ASSISTING FUND COUNSEL IN
PREPARATION OF PROXY MATERIALS, PREPARATION OF MINUTES AND TABULATION OF
RESULTS.
o MONITOR AND PAY FUND BILLS, MAINTAIN FUND BUDGET AND REPORT BUDGET
EXPENSES AND VARIANCES TO FUND MANAGEMENT.
o MONITOR THE TRUST'S COMPLIANCE WITH THE INVESTMENT RESTRICTIONS AND
LIMITATIONS IMPOSED BY THE 1940 ACT AND STATE BLUE SKY LAWS AND APPLICABLE
REGULATIONS THEREUNDER, THE TRUSTAMENTAL AND NON-FUNDAMENTAL INVESTMENT
POLICIES AND LIMITATIONS SET FORTH IN THE TRUST'S PROSPECTUSES AND
STATEMENT OF ADDITIONAL INFORMATION, AND THE INVESTMENT RESTRICTIONS AND
LIMITATIONS NECESSARY FOR EACH PORTFOLIO OF THE TRUST TO QUALIFY AS A
REGULATED INVESTMENT COMPANY UNDER SUBCHAPTER M OF THE INTERNAL REVENUE
CODE OF 1986, AS AMENDED, OR ANY SUCCESSOR STATUTE.
o PREPARE AND DISTRIBUTE TO APPROPRIATE PARTIES NOTICES ANNOUNCING DIVIDENDS
AND OTHER DISTRIBUTIONS TO SHAREHOLDERS.
o PROVIDE OTHER ADMINISTRATIVE SERVICES AS MAY BE AGREED FROM TIME TO TIME
IN WRITING BY THE TRUST OR ADMINISTRATOR.
25
COMPLIANCE SERVICES PROVIDED BY MATRIX CAPITAL GROUP (IF PART OF CONTRACT)
--------------------------------------------------------------------------------
o PROVIDE COMPLIANCE SERVICES TO THE TRUST, INCLUDING:
o ONE OF MATRIX'S EMPLOYEES WILL SERVE AS THE AML COMPLIANCE OFFICER OF THE
TRUST.
26
TRANSFER AGENT, SHAREHOLDER SERVICING AGENT AND DIVIDEND DISBURSING AGENT
SERVICES PROVIDED BY MATRIX CAPITAL GROUP
--------------------------------------------------------------------------------
o EXAMINE AND PROCESS NEW ACCOUNTS, SUBSEQUENT PAYMENTS, LIQUIDATIONS,
EXCHANGES, TRANSFERS, TELEPHONE TRANSACTIONS, CHECK REDEMPTIONS AUTOMATIC
WITHDRAWALS, AND WIRE ORDER TRADES.
o REINVEST OR PAY DIVIDENDS AND MAKE OTHER DISTRIBUTIONS.
o ANSWER INVESTOR AND DEALER TELEPHONE AND/OR WRITTEN INQUIRIES, EXCEPT AS
OTHERWISE AGREED BY THE TRANSFER AGENT AND THE TRUST.
o PROCESS AND CONFIRM ADDRESS CHANGES.
o PROCESS STANDARD ACCOUNT RECORD CHANGES AS REQUIRED, I.E. DIVIDEND CODES,
ETC.
o MICROFILM AND/OR STORE SOURCE DOCUMENTS FOR TRANSACTIONS, SUCH AS ACCOUNT
APPLICATIONS AND CORRESPONDENCE.
o PERFORM BACKUP WITHHOLDING FOR THOSE ACCOUNTS IN ACCORDANCE WITH FEDERAL
REGULATIONS.
o SOLICIT MISSING TAXPAYER IDENTIFICATION NUMBERS.
o PROVIDE REMOTE ACCESS INQUIRY TO FUND RECORDS VIA FUND SUPPLIED HARDWARE
(FUND RESPONSIBLE FOR CONNECTION LINE AND MONTHLY FEE).
o MAINTAIN THE FOLLOWING SHAREHOLDER INFORMATION AS REQUIRED UNDER FEDERAL
SECURITIES LAWS IN SUCH A MANNER AS THE TRANSFER AGENT SHALL DETERMINE:
o NAME AND ADDRESS, INCLUDING ZIP CODE.
o BALANCE OF SHARES.
o NUMBER OF SHARES, ISSUANCE DATE OF EACH SHARE OUTSTANDING AND
CANCELLATION DATE OF EACH SHARE NO LONGER OUTSTANDING, IF ISSUED.
o BALANCE OF DOLLARS AVAILABLE FOR REDEMPTION.
o DIVIDEND CODE (DAILY ACCRUAL, MONTHLY REINVEST, MONTHLY CASH OR
QUARTERLY CASH).
o TYPE OF ACCOUNT CODE.
o ESTABLISHMENT DATE INDICATING THE DATE AN ACCOUNT WAS OPENED,
CARRYING FORWARD PRE-CONVERSION DATA AS AVAILABLE.
o ORIGINAL ESTABLISHMENT DATE FOR ACCOUNTS OPENED BY EXCHANGE.
o W-9 WITHHOLDING STATUS AND PERIODIC REPORTING.
27
o STATE OF RESIDENCE CODE.
o SOCIAL SECURITY OR TAXPAYER IDENTIFICATION NUMBER, AND INDICATION OF
CERTIFICATION.
o HISTORICAL TRANSACTIONS ON THE ACCOUNT FOR THE MOST RECENT 18
MONTHS, OR OTHER PERIOD AS MUTUALLY AGREED TO FROM TIME TO TIME.
o INDICATION AS TO WHETHER PHONE TRANSACTION CAN BE ACCEPTED FOR THIS
ACCOUNT. BENEFICIAL OWNER CODE, I.E. MALE, FEMALE, JOINT TENANT,
ETC.
o PROVIDE THE FOLLOWING REPORTS AND STATEMENTS:
o PREPARE DAILY JOURNALS FOR FUND REFLECTING ALL SHARES AND DOLLAR
ACTIVITY FOR THE PREVIOUS DAY.
o SUPPLY INFORMATION MONTHLY FOR FUND'S PREPARATION OF BLUE SKY
REPORTING.
o SUPPLY MONTHLY PURCHASE, REDEMPTION AND LIQUIDATION INFORMATION FOR
USE IN FUND'S N-SAR REPORT.
o PROVIDE MONTHLY AVERAGE DAILY BALANCE REPORTS FOR THE TRUST.
o PREPARE AND MAIL COPIES OF SUMMARY STATEMENTS TO DEALERS AND
INVESTMENT ADVISORS.
o MAIL TRANSACTION CONFIRMATION STATEMENTS DAILY TO INVESTORS.
o ADDRESS AND MAIL FOUR PERIODIC FINANCIAL REPORTS (MATERIAL MUST BE
ADAPTABLE TO TRANSFER AGENT'S MECHANICAL EQUIPMENT AS REASONABLY
SPECIFIED BY THE TRANSFER AGENT).
o MAIL PERIODIC STATEMENT TO INVESTORS.
o COMPUTE, PREPARE AND FURNISH ALL NECESSARY REPORTS TO GOVERNMENTAL
AUTHORITIES: FORMS 1099R, 1099DIV, 1099B, 1042 AND 1042S.
o ENCLOSE VARIOUS MARKETING MATERIAL AS DESIGNATED BY THE TRUST IN
STATEMENT MAILINGS, I.E. MONTHLY AND QUARTERLY STATEMENTS (MATERIAL
MUST BE ADAPTABLE TO MECHANICAL EQUIPMENT AS REASONABLY SPECIFIED BY
THE TRANSFER AGENT).
o PREPARE AND MAIL CONFIRMATION STATEMENTS TO DEALERS DAILY.
o PREPARE CERTIFIED LIST OF STOCKHOLDERS FOR PROXY MAILING.
o ENSURE COMPLIANCE WITH USA PATRIOT ACT AND PRIVACY REGULATIONS
o ON GOING MONITORING OF LOST SHAREHOLDERS AND RPO TRACKING
o PROVIDE DAILY REPORT OF SALES/REDEMPTION ACTIVITY
28
SCHEDULE B
Compensation Schedule for Services Provided by Matrix Capital Group, Inc.
Fund Administration, Fund Accounting, and Transfer Agent Services
-----------------------------------------------------------------
The fees stated in this proposal are subject to the execution of an agreement
with the initial term of two (2) years. This proposed fee shall be effective for
a period of 30 days from the date of its receipt.
EQUITY FUNDS ($30,000 minimum/per fund -- no fee for additional classes)
0.075% of the Trust's first $400 million in assets
0.030% of the Trust's assets in excess of $400 million to $600 million
0.020% of the Trust's assets in excess of $600 million
FIXED INCOME FUNDS ($30,000 minimum/per fund -- no fee for additional classes)
0.040% of the Trust's first $400 million in assets
0.025% of the Trust's assets in excess of $400 million to $600 million
0.010% of the Trust's assets in excess of $600 million
MONEY MARKET FUNDS ($75,000 minimum/per fund -- no fee for additional classes)
0.020% of the Trust's first $500 million in assets
0.015% of the Trust's assets in excess of $500 million to $1 billion
0.010% of the Trust's assets in excess of $1 billion
Note:
If incurred, a $10,000 deconversion credit ($5,000 a month for the first two (2)
months) will be applied against service fees. Additionally, up to $30,000 credit
will be applied for future acquisition/merger of funds into the Monteagle Funds
Trust.
Plus out-of-pocket expenses to include, but not limited to:
Wire fees, bank service charges, printing, copying, postage, courier, account
statement/confirmations (including programming costs for specialized statements
and/or confirmation) Fund/SERV fee, price quotation service, record retention
fees, shareholder web access fees, registration fees, travel and other standard
miscellaneous items, per schedule attached.
29
SCHEDULE C
MONTEAGLE FUNDS
Portfolios covered by this Agreement:
-------------------------------------
- Monteagle Fixed Income Fund
- Monteagle Select Value Fund
- Monteagle Quality Growth Fund
- Monteagle Informed Investor Growth Fund
- Monteagle Large Cap Growth Fund
- Monteagle Value Fund
30
