EX-99.B9B
DELAWARE GROUP OF FUNDS
FUND ACCOUNTING AGREEMENT
THIS AGREEMENT, made as of this 19th day of August, 1996 by and between
the registered investment companies in the Delaware Group listed on Schedule A,
which Schedule may be amended from time to time as provided in Section 8 hereof
(each corporation or common law or business trust, hereinafter referred to as a
"Company," and all such entities collectively hereinafter referred to as, the
"Companies"), on behalf of the portfolio(s) of securities of such Companies
listed on Schedule A, which Schedule may be amended from time to time (when used
in this Agreement in the context of a Company that offers only a single
portfolio/series of shares, the term "Portfolio" shall be a reference to such
Company, and when used in the context of a Company that offers multiple
portfolios/series of shares, shall be a reference to each portfolio/series of
such Company) and DELAWARE SERVICE COMPANY, INC. ("DSC"), a Delaware
corporation, having its principal office and place of business at 0000 Xxxxxx
Xxxxxx, Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000.
W I T N E S S E T H:
WHEREAS, the Investment Management Agreements between the Companies
with respect to each Portfolio and either Delaware Management Company, Inc. or
its U.K. affiliate, Delaware International Advisers Ltd., provide, in part, that
each
Portfolio shall conduct its business and affairs and shall bear the expenses
necessary and incidental thereto including, but not in limitation of the
foregoing, the costs incurred with respect to accounting services; and
WHEREAS, the services to be provided under this agreement
previously were provided by employees of the Companies; and
WHEREAS, the Companies and DSC desire to have a written agreement
concerning the performance of accounting services for each Portfolio and
providing compensation therefor;
NOW, THEREFORE, in consideration of the mutual covenants hereinafter
set forth, and intending legally to be bound, it is agreed:
I. APPOINTMENT AS AGENT
Section 1.1 The Companies hereby appoint DSC the accounting agent
("Accounting Agent") for all of the classes of each Portfolio, to provide such
accounting services as are set forth herein and DSC hereby accepts such
appointment and agrees to provide the Companies, as their agent, the services
described herein.
Section 1.2 The Companies shall pay DSC and DSC shall accept, for the
services provided hereunder, the compensation provided for in Section VI hereof.
The Companies also shall reimburse DSC for expenses incurred or advanced by it
for the Companies in connection with its services hereunder.
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II. DOCUMENTATION
Section 2.1 Each Company represents that it has provided or made
available to DSC (or has given DSC an opportunity to examine) copies of, and,
DSC represents that it has received from the Companies (or is otherwise familiar
with), the following documents:
A. The Articles of Incorporation or Agreement and Declaration
of Trust or other document, as relevant, evidencing each Company's form of
organization and any current amendments thereto;
B. The By-Laws or Procedural Guidelines of each Company;
C. Any resolution or other action of each Company or the Board
of Directors or Trustees of each Company establishing or affecting the rights,
privileges or other status of any class of shares of a Portfolio, or altering or
abolishing any such class;
D. A certified copy of a resolution of the Board of Directors
or Trustees of each Company appointing DSC as Accounting Agent for each
Portfolio and authorizing the execution of this Agreement or an amendment to
Schedule A of this Agreement;
E. A copy of each Company's currently effective prospectus[es]
and Statement[s] of Additional Information under the Securities Act of 1933, if
effective;
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F. A certified copy of any resolution of the Board of
Directors or Trustees of each Company authorizing any person to give
instructions to DSC under this Agreement (with a specimen signature of such
person if not already provided), setting forth the scope of such authority; and
G. Any amendment, revocation or other document altering,
adding, qualifying or repealing any document or authority called for under this
Section 2.1.
Section 2.2 Each Company and DSC may consult as to forms or documents
that may be required in performing services hereunder.
Section 2.3 Each Company warrants the following:
A. The Company is, or will be, a properly registered
investment company under the Investment Company Act of 1940 (the "1940 Act") and
any and all shares of a Portfolio which it issues will be properly registered
and lawfully issued under applicable federal and state laws.
B. The provisions of this contract do not violate the terms of
any instrument by which the Company or the Company on behalf of a Portfolio is
bound; nor do they violate any law or regulation of any body having jurisdiction
over the Company or its property.
Section 2.4 DSC warrants the following:
A. The provisions of this contract do not violate the terms of
any instrument by which DSC is bound; nor do they violate any law or regulation
of any body having jurisdiction over DSC or its property.
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III. SERVICES TO BE PROVIDED BY DSC
Section 3.1 Daily Net Asset Value ("NAV") Calculation. As Accounting
Agent for each Portfolio of the Companies, DSC will perform all functions
necessary to provide daily Portfolio NAV calculations, including:
A. Maintaining each Portfolio's securities portfolio history
by:
1. recording portfolio purchases and sales;
2. recording corporate actions and capital changes
relating to portfolio securities;
3. accruing interest, dividends and expenses; and
4. maintaining the income history for securities
purchased by a Portfolio.
B. Determining distributions to Portfolio shareholders;
C. Recording and reconciling shareholder activity including:
1. recording subscription, liquidations and dividend
reinvestments;
2. recording settlements of shareholder activity; and
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3. reconciling Portfolio shares outstanding to the
records maintained by DSC, as transfer agent of the Portfolio.
Valuing a Portfolio's securities portfolio which
includes determining the NAVs for all classes of the Portfolio;
D. Disseminating Portfolio NAVs and dividends to interested
parties (including the National Association of Securities Dealers Automated
Quotation System ("NASDAQ"), the Investment Company Institute ("ICI"),
Morningstar, and Lipper Analytical Services, Inc. ("Lipper")); and
E. Resolving pricing and/or custody discrepancies.
Section 3.2 Financial Reporting. As Accounting Agent, DSC shall perform
financial reporting services for each Portfolio, which shall include:
A. The preparation of semi-annual and annual reports
for shareholders which involves the performance of the following functions:
1. preparing all statements of net assets,
statements of operations and statements of changes in net assets for the
Portfolio;
2. preparing footnotes to financial
statements for the Portfolio;
3. preparing workpapers for each Company's
annual audit by its independent public accountants; and
4. coordinating the annual audit by each
Company's independent public accountants.
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B. Reporting to the ICI in response to requests for
monthly and other periodic information;
C. Performing statistical reporting, which includes
daily, monthly, quarterly and annual reports for Lipper, Xxxxxxxxxxxx and other
third party reporting agencies; and
D. Furnishing financial information for any
additional required SEC reporting, such as the preparation of financial
information for each Company's reporting on Form N-SAR, the furnishing of
financial information for each Company's prospectus[es] and statement[s] of
additional information, and the financial information required for each
Company's annual Rule 24f-2 notice filing;
Section 3.3 Compliance Testing. DSC will monitor, test and prepare and
maintain supporting schedules which evidence compliance with the definitional
and distribution requirements under the Internal Revenue Code of 1986, as
amended ("IRC"), including the following:
A. The requirement to be registered at all times during the
taxable year under the 0000 Xxx (XXX Section 851(a));
B. The annual ninety percent gross income test (IRC Section
851(b)(2));
C. The short/short (thirty percent) gross income test (IRC
Section 851(b)(3));
D. The quarterly IRC industry diversification tests (IRC
Sections 851(b)(4) and 817(h)); and
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E. The 90% distribution requirements (IRC Section 852(a)).
Section 3.4 Other Services. In addition to the above, DSC, in
its capacity as Accounting Agent for the Company, will perform the following
services:
A. The calculation of required Portfolio monthly yields and
total return calculations in accordance with the prescribed rules of the U.S.
Securities and Exchange Commission;
B. Providing the financial information necessary for the
preparation of all federal and state tax returns and ancillary schedules,
including:
1. year-end excise tax distributions; and
2. compliance with Subchapter M and Section 4982 of
the IRC;
C. Performing special tax reporting to shareholders, including
the preparation of reports which reflect income earned by each Portfolio by
state, exempt income and distributions that qualify for the corporate dividends
received deduction;
D. The preparation of expense and budget figures for each
Portfolio, including the maintenance of detailed records pertaining to expense
accruals and payments and adjusting reports to reflect accrual adjustments;
E. The preparation of reports for Board of Directors' or
Trustees' meetings;
F. Coordination of the custody relationships;
G. Facilitating security settlements;
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H. Performance of required foreign security accounting
functions;
I. Performance of daily cash reconciliations for each
Portfolio;
J. Providing identified reports to portfolio managers
including:
1. providing portfolio holdings and security
valuation reports;
2. preparing cash forecasts and reconciliations
as mutually agreed upon; and
3. preparing income projections.
IV. PERFORMANCE OF DUTIES
Section 4.1 DSC may request or receive instructions from a Company and
may, at a Portfolio's expense, consult with counsel for the Company or its own
counsel, with respect to any matter arising in connection with the performance
of its duties hereunder, and shall not be liable for any action taken or omitted
by it in good faith in accordance with such instructions or opinions of counsel.
Section 4.2 DSC shall maintain reasonable insurance coverage for errors
and omissions and reasonable bond coverage for fraud.
Section 4.3 Upon notice thereof to a Company, DSC may employ others to
provide services to DSC in its performance of this Agreement.
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Section 4.4 Personnel and facilities of DSC used to perform services
hereunder may be used to perform similar services to all Companies of the
Delaware Group and their Portfolios and to others, and may be used to perform
other services for all of the Companies of the Delaware Group and others.
Section 4.5 The Companies and DSC may, from time to time, set forth in
writing at the Companies' expense certain guidelines to be applicable to the
services hereunder.
V. ACCOUNTS AND RECORDS
Section 5.1 The parties hereto agree and acknowledge that the accounts
and records maintained by DSC with respect to a Portfolio shall be the property
of such Portfolio, and shall be made available to the relevant Company promptly
upon request and shall be maintained for the periods prescribed in Rule 31a-2
under the Investment Company Act of 1940 or such longer period as shall be
agreed to by the parties hereto, at such Portfolio's expense.
VI. COMPENSATION
Section 6.1 The Companies and DSC acknowledge that the compensation to
be paid hereunder to DSC is intended to induce DSC to provide services under
this Agreement of a nature and quality which the Boards of Directors or Trustees
of the Companies, including a majority who are not parties to this
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Agreement or interested person of the parties hereto, have determined after due
consideration to be necessary for the conduct of the business of a Portfolio in
the best interests of a Portfolio and its shareholders.
Section 6.2 Compensation by a Portfolio hereunder shall be determined
in accordance with Schedule B hereto as it shall be amended from time to time as
provided for herein and which is incorporated herein as a part hereof.
Section 6.3 Compensation as provided in Schedule B shall be reviewed
and approved for each Portfolio in the manner set forth in Section 8.1 hereof by
the Boards of Directors or Trustees of the Companies at least annually and may
be reviewed and approved more frequently at the request of either party. The
Boards may request and DSC shall provide such information as the Boards may
reasonably require to evaluate the basis of and approve the compensation.
VII. STANDARD OF CARE
Section 7.1 The Companies on behalf of each Portfolio acknowledge that
DSC shall not be liable for, and in the absence of willful misfeasance, bad
faith, gross negligence or reckless disregard of the performance of its duties
under this contract, agree to indemnify DSC against, any claim or deficiency
arising from the performance of DSC's duties hereunder, including DSC's costs,
counsel fees and expenses incurred in investigating or defending any such claim
or any administrative or other
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proceeding, and acknowledge that any risk of loss or damage arising from the
conduct of a Portfolio's affairs in accordance herewith or in accordance with
guidelines or instructions given hereunder, shall be borne by the Portfolio. The
indemnification provided for in this Section 7.1 shall be made Portfolio by
Portfolio so that DSC is only entitled to indemnification from a Company on
behalf of a Portfolio for actions arising from the performance of DSC's duties
as to that Portfolio.
VIII. CONTRACTUAL STATUS
Section 8.1 This Agreement shall be executed and become effective as to
a Company with regard to a Portfolio listed on Schedule A as of the date first
written above if approved by a vote of such Company's Board of Directors or
Trustees, including an affirmative vote of a majority of the non-interested
members of the Board of such Company, cast in person at a meeting called for the
purpose of voting on such approval. It shall continue in effect for an
indeterminate period, and is subject to termination as to a Company on behalf of
a Portfolio or DSC, as the case may be, on sixty (60) days notice by either that
Company or DSC, unless earlier terminated or amended by agreement among the
parties. A Company shall be permitted to terminate this Agreement as to a
Portfolio on sixty (60) days notice to DSC. Compensation under this Agreement by
a Portfolio shall require approval by a majority vote of the Board of Directors
or Trustees of such Portfolio's Company, including an affirmative vote of the
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majority of the non-interested members of such Board cast in person at a meeting
called for the purpose of voting such approval.
Section 8.2 This Agreement shall become effective as to any Company or
Portfolio not included on Schedule A as of the date first written above, but
desiring to participate in this Agreement, on such date as an amended Schedule A
adding such new Company or Portfolio to such Schedule is executed by DSC and
such new Company or a Company on behalf of a new Portfolio following approval by
the Company or by the Company on behalf of a new Portfolio desiring to be
included in this Agreement in accordance with the method specified in Section
8.1. Any such amended Schedule A shall not affect the validity of this Agreement
as between DSC and the other Companies which have executed this Agreement or any
subsequent amendment to Schedule A of this Agreement.
Section 8.3 This Agreement may not be assigned by DSC without the
approval of all of the Companies.
Section 8.4 This Agreement shall be governed by the laws of the
Commonwealth of Pennsylvania.
DELAWARE SERVICE COMPANY, INC.
By: /s/ Xxxxx X. Xxxxxx
----------------------------------------
Xxxxx X. Xxxxxx
Senior Vice President/Chief
Administrative Officer/Chief
Financial Officer
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DELAWARE GROUP CASH RESERVE, INC.
DELAWARE GROUP DECATUR FUND, INC.
DELAWARE GROUP DELAWARE FUND, INC.
DELAWARE GROUP TAX-FREE FUND, INC.
DELAWARE GROUP TAX-FREE MONEY FUND, INC.
DELAWARE GROUP LIMITED-TERM GOVERNMENT
FUNDS, INC.
DELAWARE GROUP TREND FUND, INC.
DELAWARE GROUP DELCHESTER HIGH-YIELD
BOND FUND, INC.
DMC TAX-FREE INCOME TRUST - PENNSYLVANIA
DELAWARE GROUP VALUE FUND, INC.
DELAWARE GROUP GLOBAL & INTERNATIONAL
FUNDS, INC.
DELAWARE GROUP DELCAP FUND, INC.
DELAWARE GROUP PREMIUM FUND, INC.
DELAWARE GROUP GOVERNMENT FUND, INC.
DELAWARE GROUP ADVISER FUNDS, INC.
By: /s/Xxxxx X. Xxxxx
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Xxxxx X. Xxxxx
Chairman, President and
Chief Executive Officer
DELAWARE POOLED TRUST, INC.
By: /s/ Xxxxx X. Xxxxx
-------------------------------------
Xxxxx X. Xxxxx, Chairman
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SCHEDULE A
COMPANIES AND PORTFOLIOS COMPRISING THE DELAWARE GROUP*
Delaware Group Cash Reserve, Inc.
Delaware Group Decatur Fund, Inc.
Decatur Income Fund
Decatur Total Return Fund
Delaware Group Delaware Fund, Inc.
Delaware Fund
Devon Fund
Delaware Group Tax-Free Fund, Inc.
Tax-Free USA Fund
Tax-Free Insured Fund
Tax-Free USA Intermediate Fund
Delaware Group Tax-Free Money Fund, Inc.
Delaware Group Limited-Term Government Funds, Inc.
Limited-Term Government Fund
U.S. Government Money Fund
Delaware Group Trend Fund, Inc.
Delaware Group Delchester High-Yield Bond Fund, Inc.
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* Except as otherwise noted, all Portfolios included on this Schedule A are
Existing Portfolios for purposes of the compensation described on Schedule B to
that Fund Accounting Agreement between Delaware Service Company, Inc. and the
Delaware Group of Funds dated as of August 19, 1996 ("Agreement"). All
Portfolios added to this Schedule A by amendment executed by a Company on behalf
of such Portfolio hereof shall be a New Portfolio for purposes of Schedule B to
the Agreement.
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DMC Tax-Free Income Trust - Pennsylvania
Delaware Group Value Fund, Inc.
Delaware Group Global & International Funds, Inc.
International Equity Fund
Global Bond Fund
Global Assets Fund
Emerging Markets Fund (New)
Delaware Group DelCap Fund, Inc.
Delaware Pooled Trust, Inc.
The Defensive Equity Portfolio
The Aggressive Growth Portfolio
The International Equity Portfolio
The Defensive Equity Small/Mid-Cap Portfolio (New)
The Defensive Equity Utility Portfolio (New)
The Labor Select International Equity Portfolio
The Real Estate Investment Trust Portfolio
The Fixed Income Portfolio
The Limited-Term Maturity Portfolio (New)
The Global Fixed Income Portfolio
The International Fixed Income Portfolio (New)
The High-Yield Bond Portfolio (New)
Delaware Group Premium Fund, Inc.
Equity/Income Series
High Yield Series
Capital Reserves Series
Money Market Series
Growth Series
Multiple Strategy Series
International Equity Series
Value Series
Emerging Growth Series
Global Bond Series (New)
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Delaware Group Government Fund, Inc.
Delaware Group Adviser Funds, Inc.
Enterprise Fund
U.S. Growth Fund
World Growth Fund
New Pacific Fund
Federal Bond Fund
Corporate Income Fund
Dated as of: August 19, 1996
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SCHEDULE B
COMPENSATION
Fee Schedule for The Delaware Group of Funds
Part 1 -- Fees for Existing Portfolios
Existing Portfolios are those so designated on Schedule A to the Fund Accounting
Agreement between Delaware Service Company, Inc. and the Delaware Group of Funds
dated as of August 19, 1996 ("Agreement").
Annual Asset Based Fees
First $10 Billion of Aggregate
Complex Net Assets 2.5 Basis Points
Aggregate Complex Net Assets
over $10 Billion 2.0 Basis Points
Annual asset based fees will be charged at a rate of 2.5 basis points for the
first $10 Billion of Aggregate Complex Net Assets. Aggregate Complex Net Assets
over $10 Billion will be charged at a rate of 2.0 basis points. These fees will
be charged to a Portfolio on an aggregated pro rated basis.
Annual Minimum Fees
Domestic Equity Portfolio $35,000
Domestic Fixed Income Portfolio $45,000
International Series Portfolio $70,000
Per Class of Share Fee $ 4,000
There is an annual minimum fee that will be charged only if the annual asset
based fee is less than the calculation for the minimum fee. This fee is based on
the type and the number of classes per Portfolio. For an equity Portfolio
$35,000 will be charged; for a fixed income Portfolio $45,000 will be charged,
and for an international Portfolio $70,000 will be charged. For each class of
shares, $4,000 will be charged, such amount to be prorated over a period of less
than a year for any classes added after April 30, 1996. A total of all minimum
fees will be compared to the total asset based fee to determine which fee is
higher and, subsequently, will be used to xxxx the Companies.
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Part 2 -- Fees for New Portfolios
For each Portfolio designated as a New Portfolio on Schedule A to the Agreement,
there will be a fee of 2.0 basis points, providing that the Delaware complex net
assets are above $10 Billion (the rate would be 2.5 basis points if under $10
Billion and then 2.0 basis points once the net assets cross $10 Billion), or an
annual minimum fee calculated in the manner described above, whichever is
higher. This new fee would be added to the total of Existing Portfolio fees and
then pro rated. Fees shall not be charged for New Portfolios included on
Schedule A until such Portfolios shall have commenced operations.
Dated as of: August 19, 1996
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