FUND ACCOUNTING AGREEMENT
AGREEMENT made this __ day of ________ 2005 among REGIONS XXXXXX XXXXXX
SELECT FUNDS (the "Trust"), a Massachusetts business trust having its principal
place of business at ____________________________, XXXXXX XXXXXX SELECT FUND,
INC. (the "Corporation"), a Maryland corporation having its principal place of
business at 00 Xxxxx Xxxxx Xxxxxx, Xxxxxxx, Xxxxxxxxx, and BISYS FUND SERVICES
OHIO, INC. ("BISYS"), a Delaware corporation having its principal place of
business at 0000 Xxxxxxx Xxxx, Xxxxxxxx, Xxxx 00000.
WHEREAS, BISYS and Leader Mutual Funds ("Leader") entered into a Fund
Accounting Agreement dated April 1, 2004 (the "Leader Agreement"), whereby BISYS
agreed to perform fund accounting services for Leader, which has continued in
effect through the date hereof;
WHEREAS, certain investment portfolios of Leader, listed on Schedule A,
(the "Leader Funds") are expected to be transferred to the Trust and the
Corporation upon approval of such transaction (the "Consolidation") by the
shareholders of Leader, the Trust and the Corporation (collectively, the
"Shareholders");
WHEREAS, the Trust and the Corporation desires that BISYS continue to
perform fund accounting services for the Leader Funds and to perform fund
accounting services for certain investment portfolios of the Trust and the
Corporation, listed on Schedule A, (together with the Leader Funds, the
"Funds");
WHEREAS, BISYS is willing to perform such services on the terms and
conditions set forth in this Agreement; and
WHEREAS, BISYS, the Trust and the Corporation wish to enter into an
Agreement in order to set forth the terms under which BISYS will continue to
perform the fund accounting services set forth herein for the Trust and the
Corporation.
NOW, THEREFORE, in consideration of the covenants hereinafter contained,
the Trust, the Corporation and BISYS hereby agree as follows:
1. Services as Fund Accountant
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(a) MAINTENANCE OF BOOKS AND RECORDS. BISYS will keep and maintain the
following books and records of each Fund pursuant to Rule 31a-1 (the "Rule")
under the Investment Company Act of 1940, as amended (the 1940 Act"):
(i) Journals containing an itemized daily record in detail of all
purchases and sales of securities, all receipts and disbursements
of cash and all other debits and credits, as required by
subsection (b)(1) of the Rule;
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(ii) General and auxiliary ledgers reflecting all asset, liability,
reserve, capital, income and expense accounts, including interest
accrued and interest received, as required by subsection (b)(2)(i)
of the Rule;
(iii) Separate ledger accounts required by subsection (b)(2)(ii) and
(iii) of the Rule; and
(iv) A monthly trial balance of all ledger accounts (except shareholder
accounts) as required by subsection (b)(8) of the Rule.
(b) PERFORMANCE OF DAILY ACCOUNTING SERVICES. In addition to the
maintenance of the books and records specified above, BISYS shall
perform the following accounting services daily for each Fund:
(i) Calculate the net asset value per share utilizing prices obtained
from the sources described in subsection 1(b)(ii) below;
(ii) Obtain security prices from independent pricing services, or if
such quotes are unavailable, then obtain such prices from each
Fund's investment adviser or its designee, as approved by the
Trust's Board of Trustees and the Corporation's Board of Directors
(hereafter referred to as the "Board");
(iii) Verify and reconcile with the Funds' custodian all daily trade
activity;
(iv) Compute, as appropriate, each Fund's net income and capital gains,
dividend payables, dividend factors, 7-day yields, 7-day effective
yields, 30-day yields, and weighted average portfolio maturity;
(v) Review daily the net asset value calculation and dividend factor
(if any) for each Fund prior to release to shareholders, check and
confirm the net asset values and dividend factors for
reasonableness and deviations, and distribute net asset values and
yields to NASDAQ;
(vi) Report to the Trust and the Corporaton the daily market pricing of
securities in any money market Funds, with the comparison to the
amortized cost basis;
(vii) Determine unrealized appreciation and depreciation on securities
held in variable net asset value Funds;
(viii) Amortize premiums and accrete discounts on securities purchased
at a price other than face value, if requested by the Trust or the
Corporation;
(ix) Update fund accounting system to reflect rate changes, as received
from a Fund's investment adviser, on variable interest rate
instruments;
(x) Post Fund transactions to appropriate categories;
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(xi) Accrue expenses of each Fund according to instructions received
from the Trust's Administrator;
(xii) Determine the outstanding receivables and payables for all (1)
security trades, (2) Fund share transactions and (3) income and
expense accounts;
(xiii) Provide accounting reports in connection with the Trust's and the
Corporation's regular annual audit and other audits and
examinations by regulatory agencies; and
(xiv) Provide such periodic reports as the parties shall agree upon, as
set forth in a separate schedule.
(c) SPECIAL REPORTS AND SERVICES.
(i) BISYS may provide additional special reports upon the request of
the Trust, the Corporation or a Fund's investment adviser, which
may result in an additional charge, the amount of which shall be
agreed upon between the parties.
(ii) BISYS may provide such other similar services with respect to a
Fund as may be reasonably requested by the Trust or the
Corporation, which may result in an additional charge, the amount
of which shall be agreed upon between the parties.
(d) ADDITIONAL ACCOUNTING SERVICES. BISYS shall also perform the
following additional accounting services for each Fund, without
additional compensation:
(i) Provide monthly a download or hard copy of the unaudited financial
statements described below, upon request of the Trust or the
Corporation. The unaudited financial statements will include the
following items:
(A) Unaudited Statement of Assets and Liabilities,
(B) Unaudited Statement of Operations,
(C) Unaudited Statement of Changes in Net Assets, and
(D) Unaudited Condensed Financial Information;
(ii) Provide accounting information for the following:
(A) federal and state income tax returns and federal excise tax
returns;
(B) the Funds' semi-annual reports with the Securities and
Exchange Commission ("SEC") on Form N-SAR;
(C) the Funds' annual, semi-annual and quarterly (if any)
shareholder reports;
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(D) registration statements on Form N-1A and other filings
relating to the registration of shares;
(E) the Administrator's monitoring of the Fund' status as a
regulated investment company under Subchapter M of the
Internal Revenue Code, as amended;
(F) annual audit by the Funds' auditors; and
(G) examinations performed by the SEC.
2. Subcontracting
--------------
BISYS may, at its expense and with prior notice to the Trust or the
Corporation, subcontract with any entity or person concerning the provision of
fund accounting services contemplated hereunder (a "Sub-Fund Accountant");
provided, however, that BISYS shall not be relieved of any of its duties and
obligations under this Agreement by the appointment of any such Sub-Fund
Accountant and provided further, that BISYS shall be responsible, to the extent
provided in Section 5 hereof, for all acts of such subcontractor as if such acts
were its own.
3. Compensation
------------
The Trust and the Corporation shall pay BISYS compensation for the
services to be provided by BISYS under this Agreement in accordance with, and in
the manner set forth in Schedule B attached hereto.
4. Reimbursement of Expenses and Miscellaneous Service Fees
--------------------------------------------------------
(a) In addition to paying BISYS the fees provided in Section 3 and
Schedule B, the Trust and the Corporation agrees to reimburse BISYS for its
reasonable out-of-pocket expenses in providing services hereunder, including
without limitation the following:
(i) All freight and other delivery and bonding charges incurred
by BISYS in delivering materials to and from the Trust and
the Corporation;
(ii) All direct telephone, telephone transmission and telecopy or
other electronic transmission expenses incurred by BISYS in
communication with the Trust and the Corporation, the Trust's
and the Corporation's investment adviser or custodian,
dealers or others as required for BISYS to perform the
services to be provided hereunder;
(iii) The cost of microfilm or microfiche of records or other
materials;
(iv) All systems-related expenses associated with the provision of
special reports and services pursuant to Section 1(c) herein;
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(v) Any expenses BISYS shall incur at the written direction of an
officer of the Trust or the Corporation (other than an
employee of BISYS) thereunto duly authorized; and
(vi) Any additional expenses reasonably incurred by BISYS in the
performance of its duties and obligations under this
Agreement (but not including any amounts related to pricing
information, other than as provided in paragraph 4(b)(iii),
below).
(b) In addition, BISYS shall be entitled to receive the following
amounts:
(i) Systems development fees billed at an hourly rate of $150 per
hour, as approved by the Trust and the Corporation;
(ii) Ad hoc reporting fees billed at an agreed upon rate; and
(iii) Charges for the pricing information obtained from third
party vendors for use in pricing the securities of each
Fund's portfolio pursuant to Section 1(b)(ii) of this
Agreement, which shall not exceed the amounts that would be
incurred if the Fund were to obtain the information directly
from the relevant vendor or vendors.
5. Standard of Care; Uncontrollable Events; Limitation of Liability
----------------------------------------------------------------
BISYS shall use reasonable professional diligence to ensure the
accuracy of all services performed under this Agreement, but shall not be liable
to the Trust or the Corporation for any action taken or omitted by BISYS in the
absence of bad faith, willful misfeasance, negligence or reckless disregard by
it of its obligations and duties. The duties of BISYS shall be confined to those
expressly set forth herein, and no implied duties are assumed by or may be
asserted against BISYS hereunder.
BISYS shall maintain adequate and reliable computer and other equipment
necessary or appropriate to carry out its obligations under this Agreement. Upon
the Trust's or the Corporation's reasonable request, BISYS shall provide
supplemental information concerning the aspects of its disaster recovery and
business continuity plan that are relevant to the services provided hereunder.
Notwithstanding the foregoing or any other provision of this Agreement, BISYS
assumes no responsibility hereunder, and shall not be liable for, any damage,
loss of data, delay or any other loss whatsoever caused by events beyond its
reasonable control. Events beyond BISYS's reasonable control include, without
limitation, force majeure events. Force majeure events include natural
disasters, actions or decrees of governmental bodies, acts of terrorism, and
communication lines failures that are not the fault of either party. In the
event of force majeure, computer or other equipment failures or other events
beyond its reasonable control, BISYS shall follow applicable procedures in its
disaster recovery and business continuity plan and use all commercially
reasonable efforts to minimize any service interruption.
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BISYS shall provide the Trust and the Corporation, at such times as the
Trust or the Corporation may reasonably require, copies of reports rendered by
independent public accountants on the internal controls and procedures of BISYS
relating to the services provided by BISYS under this Agreement.
NOTWITHSTANDING ANYTHING IN THIS AGREEMENT TO THE CONTRARY, IN NO EVENT
SHALL BISYS, ITS AFFILIATES OR ANY OF ITS OR THEIR DIRECTORS, OFFICERS,
EMPLOYEES, AGENTS OR SUBCONTRACTORS BE LIABLE FOR EXEMPLARY, PUNITIVE, SPECIAL,
INCIDENTAL, INDIRECT OR CONSEQUENTIAL DAMAGES, OR LOST PROFITS, EACH OF WHICH IS
HEREBY EXCLUDED BY AGREEMENT OF THE PARTIES REGARDLESS OF WHETHER SUCH DAMAGES
WERE FORESEEABLE OR WHETHER EITHER PARTY OR ANY ENTITY HAS BEEN ADVISED OF THE
POSSIBILITY OF SUCH DAMAGES.
6. Term
----
(a) This Agreement shall become effective as of the effective date of
the Consolidation and shall continue in effect until the third anniversary of
such date (the "Initial Term"), provided that if the Consolidation is not
approved by the Shareholders this agreement shall not become effective and shall
be null and void. After the Initial Term, unless otherwise terminated as
provided herein, this Agreement shall be renewed automatically for successive
one year periods ("Rollover Periods"). This Agreement may be terminated only (i)
by provision of a notice of non-renewal in the manner set forth below, (ii) by
mutual agreement of the parties or (iii) for "cause," as defined below, upon the
provision of sixty (60) days advance written notice by the party alleging cause.
Written notice of non-renewal must be provided at least one hundred and eighty
(180) days prior to the end of the Initial Term or any Rollover Period, as the
case may be.
For purposes of this Agreement, "cause" shall mean (a) a material
breach of this Agreement that has not been remedied for thirty (30) days
following written notice of such breach from the non-breaching party; (b) a
final, unappealable judicial, regulatory or administrative ruling or order in
which the party to be terminated has been found guilty of criminal or unethical
behavior in the conduct of its business; or (c) financial difficulties on the
part of the party to be terminated which are evidenced by the authorization or
commencement of, or involvement by way of pleading, answer, consent or
acquiescence in, a voluntary or involuntary case under Title 11 of the United
States Code, as from time to time is in effect, or any applicable law, other
than said Title 11, of any jurisdiction relating to the liquidation or
reorganization of debtors or to the modification or alteration of the rights of
creditors. BISYS shall not terminate this Agreement pursuant to clause (a) above
based solely upon the Trust's or Corporation's failure to pay an amount to BISYS
which is the subject of a good faith dispute, if (i) the Trust or Corporation is
attempting in good faith to resolve such dispute with as much expediency as may
be possible under the circumstances, and (ii) the Trust or Corporation continues
to perform its obligations hereunder in all other material respects (including
paying all fees and expenses not subject to reasonable dispute hereunder).
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(b) Notwithstanding the foregoing, following any such termination, in
the event that BISYS in fact continues to perform any one or more of the
services contemplated by this Agreement (or any Schedule or exhibit hereto) with
the consent of the Trust or Corporation, the provisions of this Agreement,
including without limitation the provisions dealing with indemnification, shall
continue in full force and effect. Fees and out-of-pocket expenses incurred by
BISYS but unpaid by the Trust or Corporation upon such termination shall be
immediately due and payable upon and notwithstanding such termination. BISYS
shall be entitled to collect from the Trust or Corporation, in addition to the
fees and disbursements provided by Sections 3 and 4 hereof, the amount of all of
BISYS's cash disbursements in connection with BISYS's activities in effecting
such termination, including without limitation, the delivery to the Trust or
Corporation and/or its distributor or investment adviser and/or other parties of
the Trust's or Corporation's property, records, instruments and documents.
(c) If, for any reason other than (i) non-renewal, (ii) mutual
agreement of the parties or (iii) "cause" for termination of BISYS hereunder,
BISYS's services are terminated hereunder, BISYS is replaced as fund accountant,
or if a third party is added to perform all or a part of the services provided
by BISYS under this Agreement (excluding any Sub-Fund Accountant appointed as
provided in Section 1 hereof), then the Trust shall make a one-time cash
payment, in consideration of the fee structure and services to be provided under
this Agreement, and not as a penalty, to BISYS equal to the balance that would
be due BISYS for its services hereunder during (x) the next twelve (12) months
or (y) if less than twelve (12), the number of months remaining in the
then-current term of this Agreement, assuming for purposes of the calculation of
the one-time payment that the fees that would be earned by BISYS for each month
shall be based upon the average assets of the Funds and fees payable to BISYS
monthly during the twelve (12) months prior to the date that services terminate,
BISYS is replaced or a third party is added.
The parties further acknowledge and agree that, in the event services
are terminated, BISYS is replaced, or a third party is added, as set forth
above, (i) a determination of actual damages incurred by BISYS would be
extremely difficult, and (ii) the liquidated damages provision contained herein
is intended to adequately compensate BISYS for damages incurred and is not
intended to constitute any form of penalty.
(d) The parties acknowledge that the Trust intends to reorganize its
investment portfolios, including merging certain Funds, in 2005 (the "Merger"),
subject to Shareholder approval. The parties also acknowledge that all
accounting services with respect to Regions Xxxxxx Xxxxxx Select Short Term Bond
Fund ("Short Term Bond Fund"), a series of the Corporation will be performed by
Xxxxxx Xxxxxx & Co., Inc. commencing July 1, 2005. The parties agree that this
Agreement may be amended or terminated upon the effective date of the Merger and
on June 30, 2005 with respect to Short Term Bond Fund, without application of
the liquidated damages provision contained in Section 4(c) above provided the
terms of that certain letter agreement between Xxxxxx Asset Management, Inc.,
BISYS Fund Services Ohio, Inc., and BISYS Fund Services Limited Partnership,
dated October 18, 2004, (the "Xxxxxx Letter Agreement") are fulfilled by such
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amendment or by execution of a replacement agreement in the event of
termination.
7. Indemnification
---------------
The Trust and the Corporation agree to indemnify and hold harmless
BISYS, its employees, agents, directors, officers and nominees from and against
any and all claims, demands, actions and suits, and from and against any and all
judgments, liabilities, losses, damages, costs, charges, counsel fees and other
expenses of every nature and character arising out of or in any way relating to
BISYS's actions taken or omissions with respect to the performance of services
under this Agreement or based, if applicable, upon reasonable reliance on
information, records, instructions or requests given or made to BISYS by the
Trust or the Corporation, the investment adviser, transfer agent, administrator
or custodian thereof; provided that this indemnification shall not apply to
actions or omissions of BISYS in cases of its own bad faith, willful
misfeasance, negligence or reckless disregard by it of its obligations and
duties.
BISYS shall indemnify, defend, and hold the Trust and the Corporation
harmless from and against any and all claims, actions and suits and all losses,
damages, costs, charges, reasonable counsel fees and disbursements, payments,
expenses and liabilities (including reasonable investigation expenses) resulting
directly and proximately from BISYS's willful misfeasance, bad faith or
negligence in the performance of its duties, or by reason of reckless disregard
of its obligations and duties hereunder.
The indemnification rights hereunder shall include the right to
reasonable advances of defense expenses in the event of any pending or
threatened litigation with respect to which indemnification hereunder may
ultimately be merited. In order that the indemnification provisions contained
herein shall apply, however, it is understood that if in any case a party may be
asked to indemnify or hold the other party harmless, the indemnifying party
shall be fully and promptly advised of all pertinent facts concerning the
situation in question, and it is further understood that the indemnified party
will use all reasonable care to identify and notify the indemnifying party
promptly concerning any situation which presents or appears likely to present
the probability of such a claim for indemnification against the indemnifying
party, but failure to do so in good faith shall not affect the rights hereunder
except to the extent the indemnifying party is materially prejudiced thereby. As
to any matter eligible for indemnification, an indemnified Party shall act
reasonably and in accordance with good faith business judgment and shall not
effect any settlement or confess judgment without the consent of the
indemnifying Party, which consent shall not be withheld or delayed unreasonably.
The indemnifying party shall be entitled to participate at its own
expense or, if it so elects, to assume the defense of any suit brought to
enforce any claims subject to this indemnity provision. If the indemnifying
party elects to assume the defense of any such claim, the defense shall be
conducted by counsel chosen by it and reasonably satisfactory to the indemnified
party, whose approval shall not be unreasonably withheld. In the event that the
indemnifying party elects to assume the defense of any suit and retain counsel,
the indemnified party shall bear the fees and expenses of any additional counsel
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retained by it. An indemnifying party shall not effect any settlement without
the consent of the indemnified party (which shall not be withheld or delayed
unreasonably by the indemnified party) unless such settlement imposes no
liability, responsibility or other obligation upon the indemnified party and
relieves it of all fault. If the indemnifying party does not elect to assume the
defense of suit, it will reimburse the indemnified party for the reasonable fees
and expenses of any counsel retained by the indemnified party. The indemnity and
defense provisions set forth herein shall indefinitely survive the termination
of this Agreement.
8. Record Retention and Confidentiality
------------------------------------
BISYS shall keep and maintain on behalf of the Trust and the
Corporation all books and records which the Trust, the Corporation and BISYS is,
or may be, required to keep and maintain pursuant to any applicable statutes,
rules and regulations, including without limitation Rules 31a-1 and 31a-2 under
the 1940 Act, relating to the maintenance of books and records in connection
with the services to be provided hereunder. BISYS further agrees that all such
books and records shall be the property of the Trust and the Corporation and to
make such books and records available for inspection by the Trust and the
Corporation on request, and made available for inspection by the Trust and the
Corporation or by the SEC at reasonable times.
BISYS shall otherwise keep confidential all books and records relating
to the Trust and the Corporation and its shareholders, except when (i)
disclosure is required by law, (ii) BISYS is advised by counsel that it may
incur liability for failure to make a disclosure, (iii) BISYS is requested to
divulge such information by duly-constituted authorities or court process, or
(iv) BISYS is requested to make a disclosure by the Trust and the Corporation .
BISYS shall provide the Trust and the Corporation with reasonable advance notice
of disclosure pursuant to items (i) - (iii) of the previous sentence, to the
extent reasonably practicable.
9. Activities of BISYS
-------------------
The services of BISYS rendered to the Trust and the Corporation
hereunder are not to be deemed to be exclusive. BISYS is free to render such
services to others and to have other businesses and interests. It is understood
that Trustees, Directors, officers, employees and Shareholders of the Trust and
the Corporation are or may be or become interested in BISYS, as officers,
employees or otherwise and that partners, officers and employees of BISYS and
its counsel are or may be or become similarly interested in the Trust and the
Corporation , and that BISYS may be or become interested in the Trust and the
Corporation as a shareholder or otherwise
10. Reports
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BISYS shall furnish to the Trust and the Corporation and to its
properly authorized auditors, investment advisers, examiners, distributors,
dealers, underwriters, salesmen, insurance companies and others designated by
the Trust and the Corporation in writing, such reports and at such times as are
prescribed pursuant to the terms and the conditions of this Agreement to be
9
provided or completed by BISYS, or as subsequently agreed upon by the parties
pursuant to an amendment hereto. The Trust and the Corporation agree to examine
each such report or copy promptly and will report or cause to be reported any
errors or discrepancies therein. In the event that errors or discrepancies,
except such errors and discrepancies as may not reasonably be expected to be
discovered by the recipient after conducting a diligent examination, are not so
reported promptly, a report will for all purposes be accepted by and binding
upon the Trust and the Corporation and any other recipient, and BISYS shall have
no liability for errors or discrepancies therein and shall have no further
responsibility with respect to such report except to perform reasonable
corrections of such errors and discrepancies within a reasonable time after
requested to do so by the Trust and the Corporation .
11. Rights of Ownership
-------------------
All computer programs and procedures employed or developed by or on
behalf of BISYS to perform services required to be provided by BISYS under this
Agreement are the property of BISYS. All records and other data except such
computer programs and procedures are the exclusive property of the Trust and the
Corporation and all such other records and data shall be furnished to the Trust
and the Corporation in appropriate form as soon as practicable after termination
of this Agreement for any reason.
12. Return of Records
-----------------
BISYS may at its option at any time, and shall promptly upon the
Trust's and the Corporation's demand, turn over to the Trust and the Corporation
and cease to retain BISYS's files, records and documents created and maintained
by BISYS pursuant to this Agreement which are no longer needed by BISYS in the
performance of its services or for its legal protection. If not so turned over
to the Trust and the Corporation, such documents and records will be retained by
BISYS for six years from the year of creation. At the end of such six-year
period, such records and documents will be turned over to the Trust unless the
Trust and the Corporation authorizes in writing the destruction of such records
and documents.
13. Representations and Warranties
------------------------------
(a) The Trust and the Corporation represent and warrant that: (1) as of
the close of business on the effective date of this Agreement, each Fund that is
in existence as of the effective date has authorized unlimited shares, and (2)
this Agreement has been duly authorized by the Trust and the Corporation and,
when executed and delivered by the Trust and the Corporation, will constitute a
legal, valid and binding obligation of the Trust and the Corporation enforceable
against the Trust and the Corporation in accordance with its terms, subject to
bankruptcy, insolvency, reorganization, moratorium and other laws of general
application affecting the rights and remedies of creditors and secured parties.
(b) BISYS represents and warrants that: (1) the various procedures and
systems which BISYS has implemented with regard to safeguarding from loss or
damage attributable to fire, theft, or any other cause the records, and other
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data of the Trust and the Corporation and BISYS's records, data, equipment
facilities and other property used in the performance of its obligations
hereunder are adequate and that it will make such changes therein from time to
time as are reasonably required for the secure performance of its obligations
hereunder, and (2) this Agreement has been duly authorized by BISYS and, when
executed and delivered by BISYS, will constitute a legal, valid and binding
obligation of BISYS, enforceable against BISYS in accordance with its terms,
subject to bankruptcy, insolvency, reorganization, moratorium and other laws of
general application affecting the rights and remedies of creditors and secured
parties.
EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT, ALL REPRESENTATIONS AND
WARRANTIES, INCLUDING, WITHOUT LIMITATION, ANY WARRANTIES REGARDING QUALITY,
SUITABILITY, MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE OR OTHERWISE
(IRRESPECTIVE OF ANY COURSE OF DEALING, CUSTOM OR USAGE OF TRADE) CONCERNING THE
SERVICES OR ANY GOODS PROVIDED INCIDENTAL TO THE SERVICES PROVIDED UNDER THIS
AGREEMENT BY BISYS ARE COMPLETELY DISCLAIMED.
14. Insurance
---------
BISYS shall maintain a fidelity bond covering larceny and embezzlement
and an insurance policy with respect to directors and officers errors and
omissions coverage in amounts that are appropriate in light of its duties and
responsibilities hereunder. Upon the request of the Trust or the corporation,
BISYS shall provide evidence that coverage is in place. BISYS shall notify the
Trust and the Corporation should its insurance coverage with respect to
professional liability or errors and omissions coverage be canceled. Such
notification shall include the date of cancellation and the reasons therefore.
BISYS shall notify the Trust and the Corporation of any material claims against
it with respect to services performed under this Agreement, whether or not they
may be covered by insurance, and shall notify the Trust and the Corporation
should the total outstanding claims made by BISYS under its insurance coverage
materially impair, or threaten to materially impair, the adequacy of its
coverage.
15. Information Furnished by the Trust and the Corporation
------------------------------------------------------
The Trust and the Corporation will furnish to BISYS the following, as
amended and current as of the effective date of this Agreement:
(a) A copy of the Declaration of Trust of the Trust and of any
amendments thereto, certified by the proper official of the state in which such
Declaration has been filed and a copy of the Articles of Incorporation of the
Corporation and any amendments thereto, certified by the proper official of the
state in which such Articles of Incorporation are filed.
(b) Certified copies of the following documents:
(i) The Trust's and the Corporation's Bylaws and any amendments
thereto;
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(ii) Resolutions of the Trustees and Directors covering (A) approval of
this Agreement and authorization of a specified officer of the
Trust and the Corporation to execute and deliver this Agreement
and authorization for specified officers of the Trust and
Corporation to instruct BISYS hereunder, and (B) authorization of
BISYS to act as fund accountant for the Funds..
(c) A list of all officers of the Trust and Corporation and any other
persons (who may be associated with the Trust, the Corporation or its investment
advisor), together with specimen signatures of those officers and other persons,
who (except as otherwise provided herein to the contrary) are authorized to
instruct BISYS in all matters.
(d) Two copies of the Prospectuses and Statement of Additional
Information of each Fund.
16. Information Furnished by BISYS
------------------------------
BISYS will furnish to the Trust and Corporation evidence of the
following upon request:
(a) Approval of this Agreement by BISYS, and authorization of a
specified officer of BISYS to execute and deliver this Agreement;
(b) Authorization of BISYS to act as fund accountant for the Funds.
17. Amendments to Documents
-----------------------
The Trust and Corporation shall furnish BISYS written copies of any
amendments to, or changes in, any of the items referred to in Section 15 hereof
forthwith upon such amendments or changes becoming effective. In addition, the
Trust and the Corporation agrees that no amendments will be made to the
Prospectuses or Statements of Additional Information of the Trust or Corporation
which might have the effect of changing the procedures employed by BISYS in
providing the services agreed to hereunder or which amendment might affect the
duties of BISYS hereunder unless the Trust or Corporation first obtains BISYS's
approval of such amendments or changes, which approval shall not be withheld
unreasonably.
18. Legal Advice; Reliance on Prospectus and Instructions
-----------------------------------------------------
BISYS may apply to the Trust or Corporation at any time for
instructions and may consult with counsel for the Trust or Corporation and with
accountants and other experts with respect to any matter arising in connection
with BISYS's duties, and BISYS shall not be liable nor accountable for any
action taken or omitted by it in good faith in accordance with such instruction
or with the opinion of such counsel, accountants or other experts. BISYS shall
notify the Trust and Corporation at any time BISYS believes that it is in need
of the advice of counsel (other than counsel in the regular employ of BISYS or
any affiliated companies) with regard to BISYS's responsibilities and duties
pursuant to this Agreement. After so notifying the Trust and Corporation, BISYS,
at its discretion, shall be entitled to seek, receive and act upon advice of
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legal counsel of its choosing, such advice to be at the expense of the Trust or
Corporation unless relating to a matter involving BISYS's willful misfeasance,
bad faith, negligence or reckless disregard of BISYS's responsibilities and
duties hereunder, and BISYS shall in no event be liable to the Trust, the
Corporation or any Fund or any shareholder or beneficial owner of the Trust for
any action reasonably taken pursuant to such advice.
As to the services to be provided hereunder, BISYS may rely
conclusively upon the terms of the Prospectuses and Statement of Additional
Information of the Trust and Corporation relating to the relevant Funds to the
extent that such services are described therein, as well as the minutes of Board
meetings (if applicable) and other records of the Trust and Corporation unless
BISYS receives written instructions to the contrary in a timely manner from the
Trust or Corporation.
Also, BISYS shall be protected in acting upon any document which it
reasonably believes to be genuine and to have been signed or presented by the
proper person or persons. The Administrator will not be held to have notice of
any change of authority of any officers, employees or agents of the Trust or
Corporation until receipt of written notice thereof from the Trust or
Corporation.
19. Compliance with Law
-------------------
Except for the obligations of BISYS set forth in Section 8 hereof, the
Trust and Corporation assumes full responsibility for the preparation, contents
and distribution of each prospectus of the Trust and Corporation as to
compliance with all applicable requirements of the Securities Act of 1933, as
amended (the "Securities Act"), the 1940 Act and any other laws, rules and
regulations of governmental authorities having jurisdiction. BISYS shall have no
obligation to take cognizance of any laws relating to the sale of the Trust's or
Corporation's shares.
20. Notices
-------
Any notice provided hereunder shall be sufficiently given when sent by
registered or certified mail to the party required to be served with such notice
at the following address: if to the Trust, to
________________________________________________, Attn: ________________; if to
the Corporation to _______________________________, and if to BISYS, to it at
0000 Xxxxxxx Xxxx, Xxxxxxxx, Xxxx 00000; Attn: President, or at such other
address as such party may from time to time specify in writing to the other
party pursuant to this Section.
21. Assignment
----------
This Agreement and the rights and duties hereunder shall not be
assignable with respect to a Fund by either of the parties hereto except by the
specific written consent of the other party. This Agreement shall be binding
upon, and shall inure to the benefit of, the parties hereto and their respective
successors and permitted assigns.
13
22. Governing Law and Matters Relating to the Trust as a Massachusetts
------------------------------------------------------------------
Business Trust and the Corporation as a Maryland Corporation.
------------------------------------------------------------
This Agreement shall be governed by and provisions shall be construed
in accordance with the laws of the State of Ohio. To the extent that the
applicable laws of the State of Ohio, or any of the provisions herein, conflict
with the applicable provisions of the 1940 Act, the latter shall control. It is
expressly agreed that the obligations of the Trust or Corporation hereunder
shall not be binding upon any of the Trustees, Directors shareholders, nominees,
officers, agents or employees of the Trust or Corporation personally, but shall
bind only the trust property of the Trust or Corporation. The execution and
delivery of this Agreement have been authorized by the Board, and this Agreement
has been signed and delivered by an authorized officer of the Trust and
Corporation, acting as such, and neither such authorization by the Board nor
such execution and delivery by such officer shall be deemed to have been made by
any of them individually or to impose any liability on any of them personally,
but shall bind only the trust property of the Trust or the Corporation as
provided in the Trust's Declaration of Trust and the Corporation's Articles of
Incorporation.
23. Privacy
-------
Nonpublic personal financial information relating to consumers or
customers of the Trust or Corporation provided by, or at the direction of the
Trust or Corporation to BISYS, or collected or retained by BISYS to perform its
duties shall be considered confidential information. BISYS shall not give, sell
or in any way transfer such confidential information to any person or entity,
other than affiliates of BISYS except at the direction of the Trust or
Corporation or as required or permitted by law. BISYS shall have in place and
maintain physical, electronic and procedural safeguards reasonably designed to
protect the security, confidentiality and integrity of, and to prevent
unauthorized access to or use of records and information relating to consumers
or customers of the Trust or Corporation. The Trust and Corporation represents
to BISYS that it has adopted a Statement of its privacy policies and practices
as required by the SEC's Regulation S-P and agrees to provide BISYS with a copy
of that statement annually.
24. Miscellaneous
-------------
(a) Paragraph headings in this Agreement are included for convenience
only and are not to be used to construe or interpret this Agreement.
(b) This Agreement constitutes the complete agreement of the parties
hereto as to the subject matter covered by this Agreement, and subject to
approval of the Consolidation by the Shareholders supercedes all prior
negotiations, understandings and agreements bearing upon the subject matter
covered herein, including, without limitation, the Leader Agreement, provided
that if the Consolidation is not approved by the Shareholders the Leader
Agreement shall remain in full force and shall be unaffected by this Agreement.
This Agreement shall not supercede or otherwise affect any provisions of the
Xxxxxx Letter Agreement.
14
(c) This Agreement may be executed in counterparts, each of which shall
be an original but all of which, taken together, shall constitute one and the
same agreement.
(d) No amendment to this Agreement shall be valid unless made in
writing and executed by both parties hereto. The parties hereto may amend such
procedures as may be set forth herein by written agreement as may be appropriate
or practical under the circumstances, and BISYS may conclusively assume that any
special procedure which has been approved by an executive officer of the Trust
or the Corporation (other than an officer or employee of BISYS) does not
conflict with or violate any requirements of the Trust's Declaration of Trust,
the Corporation's Articles of Amendment, By-Laws or then-current prospectuses,
or any rule, regulation or requirement of any regulatory body.
* * * * *
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed all as of the day and year first-above written.
REGIONS XXXXXX XXXXXX SELECT FUNDS
By:__________________________________________________
Name:
Title:
XXXXXX XXXXXX SELECT FUND, INC.
By:__________________________________________________
Name:
Title:
BISYS FUND SERVICES OHIO, INC.
By:__________________________________________________
Name:
Title:
15
SCHEDULE A
TO THE FUND ACCOUNTING AGREEMENT
BETWEEN REGIONS XXXXXX XXXXXX SELECT FUND
AND BISYS FUND SERVICES OHIO, INC.
DATE: _______________, 2005
LEADER FUNDS
------------
FUND NAME BEFORE CONSOLIDATION FUND NAME AFTER CONSOLIDATION
------------------------------ -----------------------------
GROUP I
LEADER Growth Equity Fund Regions Xxxxxx Xxxxxx Select LEADER Growth Equity
Fund
LEADER Growth & Income Fund Regions Xxxxxx Xxxxxx Select LEADER Growth & Income
Fund
LEADER Balanced Fund Regions Xxxxxx Xxxxxx Select LEADER Balanced Fund
LEADER Tax-Exempt Bond Fund Regions Xxxxxx Xxxxxx Select LEADER Tax-Exempt Bond
Fund
LEADER Intermediate Bond Fund Regions Xxxxxx Xxxxxx Select LEADER Intermediate
Bond Fund
LEADER Short Term Bond Fund Regions Xxxxxx Xxxxxx Select LEADER Short Term Bond
Fund
GROUP II
LEADER Tax-Exempt Money Market Fund Regions Xxxxxx Xxxxxx Select LEADER Tax-Exempt
Money Market Fund
LEADER Money Market Fund Regions Xxxxxx Xxxxxx Select LEADER Money Market
Fund
REGIONS XXXXXX XXXXXX SELECT FUNDS
Regions Xxxxxx Xxxxxx Select Treasury Money Market Fund
Regions Xxxxxx Xxxxxx Select Government Money market Fund
16
SCHEDULE B
TO THE FUND ACCOUNTING AGREEMENT
BETWEEN REGIONS XXXXXX XXXXXX SELECT FUND
AND BISYS FUND SERVICES OHIO, INC.
DATE: ____________, 2005
FEES
Annual fee
Fee for Group I
Incremental Net Assets Leader Funds
---------------------- ---------------
Up to $500 million 0.030%
>$500 million - $1 billion 0.015%
>$1 billion 0.010%
The Annual fee for Group II Leader Funds and Regions Xxxxxx Xxxxxx Select Funds
is 0.030% of net assets.
For purposes of determining the fees, the value of each Fund's net assets shall
be computed in the manner described in the Declaration of Trust, Articles of
Incorporation or in such Fund's Prospectus as from time to time in effect for
the computation of the value of such net assets in connection with the purchase
and redemption of shares.
In addition to the fees set forth above, BISYS shall be entitled to an
additional annual charge of $10,000 per class per Fund for each class of shares
in excess of one. Additional class fees are currently waived for the Tax-Exempt
Bond Fund; $2,500 of the additional class fees is currently waived for Investor
class B Shares of all variable NAV funds. The foregoing waivers will continue
until March 31, 2006, and will then be decreased by 50% for remainder of Initial
Term and any Rollover Term.
CPI ESCALATION
The fixed fees and other fees expressed as stated dollar amounts in this
schedule and in the Agreement shall be increased annually commencing on the
one-year anniversary date of the Effective Date by the percentage increase since
the Effective Date in consumer prices for services as measured by the United
States Consumer Price Index entitled "All Services Less Rent of Shelter" or a
similar index should such index no longer be published.
17
