Exhibit (h)(4)
MUTUAL FUND SERVICES AGREEMENT
THIS AGREEMENT is made as of this ___ day of _________, 2003, by and
between THE COMMUNITY REINVESTMENT ACT QUALIFIED INVESTMENT FUND (the "Trust"),a
Delaware business trust having its principal place of business at 0000 Xxxx
Xxxxxx, Xxxxx 000, Xxxxxx, XX 00000, and CITCO-QUAKER FUND SERVICES, INC.
("CQFS"), a corporation organized under the laws of the State of Delaware and
having its principal place of business at 0000 Xxxxxx Xxxxx Xxxx, X.X. Xxx 000,
Xxxxx 00, Xxxxxx Xxxxx, XX 00000. This Agreement will become effective on the
day the Investment Company Services Agreement between the Trust and InCap
Service Company dated June 1, 1999 is terminated. CRA Fund Advisors, Inc., the
advisor to the Trust, will provide CQFS reasonable notice of such termination
date.
WHEREAS, the Trust is an open-end management investment company registered
under the Investment Company Act of 1940, as amended (the "1940 Act"); and
WHEREAS, the Trust is authorized by its Agreement and Declaration of Trust
and by-laws to issue separate Portfolios of shares representing interests in
separate investment portfolios (the "Portfolios") and to further divide such
Portfolios into separate share classes, and
WHEREAS, The Trust has authorized the issuance of shares of beneficial
interest in the Portfolios, and share classes thereof, listed on Schedule A to
this Agreement, attached hereto and made part of this Agreement, as such
Schedule A may be amended from time to time (each series individually referred
to herein as a "Portfolio" and collectively as the "Portfolios"), and
WHEREAS, the Trust desires that CQFS perform certain Transfer Agent,
Accounting, and Administrative Services for the Portfolio of the Trust listed on
Schedule A; and
WHEREAS, CQFS is willing to perform such services on the terms and
conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual premises and covenants
herein set forth, the parties agree as follows:
1. RETENTION OF CQFS.
The Trust hereby retains CQFS to act as Transfer Agent, Trust Accountant
and Administrator of the Trust and to furnish the Trust with the services set
forth in Schedule B to this Agreement, attached hereto and made part of this
Agreement, as such Schedule B may be amended from time to time. CQFS hereby
accepts such employment to perform such duties.
2. SUBCONTRACTING.
CQFS may, at its own expense and, upon written notice to the Trust,
subcontract with any entity or person concerning the provision of the services
contemplated in Schedule B; provided, however, that CQFS shall not be relieved
of any of its obligations under this Agreement by the
appointment of such subcontractor and provided further, that CQFS shall be
responsible, to the extent provided in Section 7 hereof, for all acts of such
subcontractor as if such acts were its own.
3. COMPENSATION.
The Trust shall pay for the services to be provided by CQFS under this
Agreement in accordance with, and in the manner set forth in, Schedule E
attached hereto. The Trust acknowledges that the pricing in this Agreement is
contingent upon the minimum investment as set forth in the current prospectus.
If the minimum investment is reduced, the parties will negotiate for 2 weeks in
order to set a fee which reflects CQFS' increased expenses. If negotiation is
unsuccessful, CQFS may terminate the Agreement in accordance with Article 6
hereof.
For purposes of determining fees payable to CQFS, 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.
If this Agreement becomes effective subsequent to the first day of a month
or terminates before the last day of a month, CQFS's compensation for that part
of the month in which the Agreement is in effect shall be prorated in a manner
consistent with the calculation of the fees as set forth above. Payment of
CQFS's compensation for the preceding month shall be made within 5 calendar
days.
4. REIMBURSEMENT OF EXPENSES.
In addition to paying CQFS the fees described in Schedule E attached
hereto, the Trust agrees to reimburse CQFS for its reasonable out-of-pocket
expenses in providing services hereunder, including without limitation the
following:
(a) All freight, delivery and bonding charges incurred by CQFS in
delivering materials to and from the Trust;
(b) All direct telephone, telephone transmission and telecopy or other
electronic transmission expenses incurred by CQFS in communications with
the Trust, an adviser or sub-adviser to the Trust, the Trust's custodian,
dealers and charges for maintaining a toll-free number for investors and
potential investors; or other charges required to permit CQFS to perform
the services to be provided hereunder and
(c) The Trust's proportionate costs of obtaining security market quotes;
(d) All expenses incurred in connection with any custom programming or
systems modifications required to provide any special reports or services
requested by the Trust;
(e) Any expenses CQFS shall incur at the written direction of an officer
of the Trust thereunto duly authorized other than an employee or other
affiliated person of CQFS who may otherwise be named as an authorized
representative of the Trust for certain purposes; and
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(f) Any additional expenses reasonably incurred by CQFS in the performance
of its duties and obligations under this Agreement and approved in advance
by the Trust.
5. EFFECTIVE DATE.
This Agreement shall become effective with respect to a Portfolio as of the
date first written above (or, if a particular Portfolio is not in existence on
that date, on the date such Portfolio commences operation) (the "Effective
Date").
6. TERM OF THIS AGREEMENT.
The term of this Agreement shall continue in effect, unless earlier
terminated by any party hereto as provided hereunder, until May 31 2008.
Thereafter, unless otherwise terminated as provided herein, this Agreement shall
be renewed automatically for additional periods of one year.
This Agreement may be terminated without penalty: (i) by the Trust or CQFS
upon ninety (90) days' written notice; or (ii) by the Trust for "cause" (as
defined below) upon the provision of sixty (60) days' advance written notice.
For purposes of this Agreement, "cause" shall mean:
(i) a material breach of this Agreement that has not been remedied within
thirty (30) days following written notice of such breach;
(ii) an act or omission involving gross negligence, willful malfeasance or
intentional wrongdoing;
(iii) a series of negligent acts, omissions or breaches of this Agreement
which, in the aggregate, constitute in the reasonable judgment of the
Trust, a serious, unremedied and ongoing failure to perform
satisfactorily CQFS's obligations hereunder, so long as notice of
such acts, omissions and breaches has been provided to CQFS which
remain uncured within the time frame set forth above;
(iv) a final, non-appealable judicial, regulatory or administrative ruling
or order in which CQFS has been found guilty of criminal or unethical
behavior in the conduct of its business; or
(v) financial difficulties evidenced by the filing of a voluntary or
involuntary bankruptcy petition 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 the modification or alteration of the
rights of creditors.
Notwithstanding the foregoing, in the event this Agreement is terminated
and if CQFS, with the written consent of the Trust, in fact continues to perform
any one or more of the services contemplated by this Agreement or any schedule
or exhibit hereto, the provisions of this Agreement, including without
limitation the provisions dealing with indemnification, shall continue in full
force and effect. Compensation due CQFS and unpaid by the Trust upon such
termination shall be immediately due and payable upon and notwithstanding such
termination. CQFS shall be entitled to collect from the Trust, in addition to
the compensation described in Schedule E, reasonable de-conversion expenses,
including but not limited to, the amount of all of
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CQFS's out of pocket expenses incurred for services in connection with CQFS's
activities in effecting such termination, including without limitation, the
delivery to the Trust and/or its designees of the Trust's property, records,
instruments and documents, and a charge for other resources needed to effect
such de-conversion.
7. STANDARD OF CARE.
The duties of CQFS shall be confined to those expressly set forth herein,
and no implied duties are assumed by or may be asserted against CQFS hereunder.
CQFS shall be obligated to exercise care and diligence in the performance of its
duties hereunder and to act in good faith in performing the services provided
for under this Agreement. CQFS shall be liable for any damages arising directly
or indirectly out of CQFS's failure to perform its duties under this Agreement
to the extent such damages arise directly or indirectly out of CQFS's willful
misfeasance, bad faith, negligence in the performance of its duties, or reckless
disregard of it obligations and duties hereunder. (As used in this Article 7,
the term "CQFS" shall include directors, officers, employees and other agents of
CQFS as well as CQFS itself.)
Without limiting the generality of the foregoing or any other provision of
this Agreement, (i) CQFS shall not be liable for consequential, special or
punitive damages or (ii) any losses beyond its reasonable control, provided that
CQFS has acted in accordance with the standard of care set forth above; and
(iii) CQFS shall not be liable for the validity or invalidity or authority or
lack thereof of any instruction, notice or other instrument that CQFS reasonably
believes to be genuine and to have been signed or presented by a duly authorized
representative of the Trust (other than an employee or other affiliated persons
of CQFS who may otherwise be named as an authorized representative of the Trust
for certain purposes).
CQFS may apply to the Trust at any time for instructions and may consult
with counsel for the Trust and with accountants and other experts with respect
to any matter arising in connection with CQFS' duties hereunder, and CQFS shall
not be liable or 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 qualified to render such opinion.
8. INDEMNIFICATION.
The Trust agrees to indemnify and hold harmless CQFS from and against any
and all actions, suits, claims, losses, damages, costs, charges, reasonable
counsel fees and disbursements, payments, expenses and liabilities (including
reasonable investigation expenses) (collectively, "Losses") to which CQFS may
become liable arising directly or indirectly out of any action or omission to
act which CQFS takes (i) at any request or on the direction of or in reliance on
the reasonable advice of the Trust, (ii) upon any instruction, notice or other
instrument that CQFS reasonably believes to be genuine and to have been signed
or presented by a duly authorized representative of the Trust (other than an
employee or other affiliated person of CQFS who may otherwise be named as an
authorized representative of the Trust for certain purposes) or (iii) on its own
initiative, in good faith and in accordance with the standard of care set forth
in Article 7 above, in connection with the performance of its duties or
obligations hereunder. Further, CQFS shall not be indemnified against or held
harmless from any Losses arising directly or indirectly out of CQFS' own willful
misfeasance, bad faith, negligence in the performance of its duties, or reckless
disregard of its obligations and duties hereunder. (As used in this Article 8,
the term "CQFS" shall include Trustees, officers, employees and other agents of
CQFS as well as CQFS itself).
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CQFS agrees to indemnify and hold harmless the Trust from and against any
and all actions, suits, claims, losses, damages, costs, charges, reasonable
counsel fees and disbursements, payments, expenses and liabilities (including
reasonable investigation expenses) (collectively, "Losses") to which the Trust
may become liable arising directly or indirectly out of CQFS's own willful
misfeasance, bad faith, negligence or reckless disregard of its obligations and
duties as set forth in this Agreement. (As used in this Article 8, the term
"CQFS" shall include Trustees, officers, employees and other agents of CQFS as
well as CQFS itself.)
The party seeking indemnification under this Article 8 shall notify the
other party promptly after receipt of any written assertion of such claim
threatening to institute or actually instituting an action or proceeding,
including service of summons or other legal process. Failure to notify the party
from whom indemnification is sought will relieve that party from any liability
which it may have on account of the indemnity provisions set forth under this
Article 8 unless the party has notice of the claim from another source.
The parties will cooperate in the control of the defense of any action,
suit or proceeding. Any party from whom indemnification is sought may negotiate
the settlement of any action, suit or proceeding subject to the other party's
approval, which approval will not be unreasonably withheld. The party seeking
indemnification reserves the right to participate in the defense or settlement
of a claim, action or proceeding with its own counsel, at its own cost, unless:
o it has received an opinion from counsel to the indemnifying party
stating that the use of common counsel would present an impermissible
conflict of interest which does not otherwise alter the ability to
obtain indemnification;
o the defendants in, or targets of, any such action or proceeding
include both CQFS and the Trust, and legal counsel to either party has
reasonably concluded that there are legal defenses available to a
party which are different from or additional to those available to the
other party or which may be adverse to or inconsistent with defenses
available to a party; or
o the party from whom indemnification is sought authorizes the other
party to employ separate counsel at the expense of the indemnifying
party.
o The terms of this Article 8 will survive the termination of this
Agreement.
9. RECORD RETENTION AND CONFIDENTIALITY.
CQFS shall keep and maintain on behalf of the Trust all books and records
which the Trust and CQFS 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. CQFS
further agrees that all such books and records shall be the property of the
Trust and to make such books and records available for inspection by the Trust
or by the SEC at reasonable times and otherwise to keep confidential all books
and records and other information relative to the Trust and its shareholders;
except when requested to divulge such information by duly-constituted
authorities or court process. In the event CQFS receives a request from a
regulatory authority or civil process requesting such information, it will give
notice to the Trust but shall not be obliged to await the Trust's response
before complying with the request. CQFS agrees that it will not use any
nonpublic information for any purpose other than the performance of its duties
or obligations hereunder. These confidentiality obligations will survive the
termination of the Agreement.
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10. FORCE MAJEURE.
CQFS 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, including acts of civil or military authority, national
emergencies, fire, flood, catastrophe, acts of God, insurrection, war, riots or
failure of the mails, transportation, communication or power supply.
11. RIGHTS OF OWNERSHIP; RETURN OF RECORDS.
All records and other data except computer programs, whether or not
customized, and procedures developed to perform services required to be provided
by CQFS are the exclusive property of the Trust and all such records and data
will be furnished to the Trust in appropriate form as soon as practicable after
termination of this Agreement for any reason. CQFS may at its option at any
time, and shall promptly upon the Trust's demand, turn over to the Trust and
cease to retain CQFS's files, records and documents created and maintained by
CQFS pursuant to this Agreement which are no longer needed by CQFS in the
performance of its services or for its legal protection. If not so turned over
to the Trust, such documents and records will be retained by CQFS 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 authorizes in
writing the destruction of such records and documents. If destruction of
documents is authorized by the Trust, CQFS shall provide reasonable proof of
such destruction to the Trust. The Trust shall indemnify CQFS pursuant to
Article 8 against all claims arising from CQFS' acquiescence to this
instruction.
12. REPRESENTATIONS OF THE TRUST.
The Trust certifies to CQFS that: (1) as of the close of business on the
Effective Date, each Portfolio that is in existence as of the Effective Date has
authorized an indefinite number of shares, (2) this Agreement has been duly
authorized by the Trust and, when executed and delivered by the Trust, will
constitute a legal, valid and binding obligation of the Trust, enforceable
against the Trust 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; (3) that it
has no undisclosed regulatory, civil or criminal investigations, proceedings,
claims or lawsuits, and that it will adhere to all pertinent laws and
regulations, including providing the certifications required by the
Xxxxxxxx-Xxxxx Act ; (4) that it will disclose promptly any material regulatory,
civil or criminal investigation, proceeding, claim or lawsuit during the term of
this Agreement and (5) that the Trust is aware of its obligations under the
PATRIOT Act and will work with CQFS to assure that its procedures do currently
and will be adequate to meet the burdens thereunder.
13. REPRESENTATIONS OF CQFS.
CQFS represents and warrants that: (1) the various procedures and systems
which CQFS has implemented with regard to safeguarding from loss or damage CQFS'
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 required for the secure performance of its
obligations hereunder, (2) this Agreement has been duly authorized by CQFS and,
when executed and delivered by CQFS, will constitute a legal, valid and binding
obligation of CQFS, enforceable against CQFS 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, (3) it is duly registered with the
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appropriate regulatory agency as a transfer agent and such registration will
remain in full force and effect for the duration of this Agreement, (4) it has
and will continue to have access to the necessary facilities, equipment and
personnel to perform its duties and obligations under this Agreement; (5) that
it has no undisclosed regulatory, civil or criminal investigations, proceedings,
claims or lawsuits and that it will adhere to all pertinent laws and
regulations; and (6) that it will disclose promptly any material regulatory,
civil or criminal investigation, proceeding, claim or lawsuit during the term of
this Agreement.
14. INSURANCE.
CQFS shall furnish the Trust with pertinent information concerning the
professional liability insurance coverage that it maintains. Such information
shall include the identity of its insurance carrier(s), coverage levels and
deductible amounts. CQFS shall notify the Trust within ten (10) days should any
of its insurance coverage be canceled or reduced. Such notification shall
include the date of change and the reasons therefore. CQFS shall notify the
Trust within ten (10) of any material claims against it with respect to services
performed under this Agreement, whether or not they may be covered by insurance.
Any failure on the part of CQFS to notify the Trust of changes to CQFS's
insurance coverage as set forth in this Article 14 shall constitute a material
breach of this Agreement, and the Trust shall be entitled to terminate this
Agreement immediately in the event of such a breach.
15. DISASTER RECOVERY
CQFS shall enter into and shall maintain in effect one or more agreement
making reasonable provisions for emergency use of electronic data processing
equipment to the extent appropriate equipment is available. In the event of
equipment failures, CQFS shall, at no additional expense to the Trust, take
reasonable steps to minimize service interruptions. CQFS shall have no liability
with respect to the loss of data or service interruptions caused by equipment
failures, provided such loss or interruption is not caused by CQFS's own willful
misfeasance, bad faith, negligence or reckless disregard of its duties or
obligations under this Agreement.
16. 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.
16. XXXXXXXX-XXXXX.
CQFS agrees that any information that CQFS provides that is necessary to
complete a report or other filing that is required to be certified by certain of
the Trust's officers pursuant to xx Xxxxxxxx-Xxxxx Act of 2002 and regulations
issued and in effect from time to time under that Act will be true and complete
when given. CQFS further aggress that any written representation or
certification by it to the Securities and Exchange Commission pursuant to
Xxxxxxxx-Xxxxx and any rules or regulations issued from time to time pursuant to
that statute will be true and complete when given.
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17. USA PATRIOT ACT
The Trust hereby delegates its responsibility under the PATRIOT Act to
implement and operate the Trust's anti money-laundering policy to CQFS and CQFS
accepts that responsibility. CQFS agrees to make available to any governmental
agency with appropriate authority its records regarding the anti-money
laundering program it administers on behalf of the Trust, including those
records pertaining to the Customer Identification Program ("CIP"). The Trust and
CQFS will work together to adopt an appropriate program to carry out these
responsibilities of the Trust. CQFS represents that it is regulated by a federal
functional regulator and that it has and will implement its AML program in
accordance with all applicable federal laws and regulations. CQFS will certify
to the Trust annually, in a form acceptable to the appropriate federal
regulators, that it carries out portions of the Trust's CIP for the Trust.
18. INFORMATION TO BE FURNISHED BY THE TRUST.
The Trust has furnished to CQFS, or will furnish prior to the Effective
Date, the following:
(a) Copies of the following documents:
1. The Trust's Agreement and Declaration of Trust and of any
amendments thereto, certified by the proper official of the state
in which such document has been filed.
2. The Trust's Bylaws and any amendments thereto; and
3. Copies of resolutions of the Trustees covering the approval of
this Agreement, authorization of a specified officer of the Trust
to execute and deliver this Agreement and authorization for
specified officers of the Trust to instruct CQFS thereunder.
(b) A list of all the officers of the Trust, together with specimen
signatures of those officers who are authorized to instruct CQFS in
all matters.
(c) Anti-Money Laundering Procedures, if any, that the Trust has adopted,
and the identity of the Compliance Officer, if any, to the Trust.
(d) Copies of the Prospectus and Statement of Additional Information for
each Portfolio.
(e) Copies of any other documents reasonably requested by CQFS in
connection with entering into this Agreement.
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19. AMENDMENTS TO AGREEMENT.
This Agreement, or any term thereof, may be changed or waived only by
written amendment signed by the party against whom enforcement of such change or
waiver is sought.
The parties hereto acknowledge that industry practice, as guided by
regulatory requirements, will be used by CQFS in performing the duties set forth
in the Schedules hereto. Should the Trust request a change to a particular
procedure, CQFS' responsibility will be only that set forth in Paragraph 7
hereof.
20. COMPLIANCE WITH LAW.
Except for the obligations of CQFS otherwise set forth herein, the Trust
assumes full responsibility for the preparation, contents and distribution of
each prospectus of the Trust 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. The Trust represents and warrants that the Trust's registration
statement under the Securities Act and the 1940 Act has been declared effective.
21. 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 CQFS, at 0000 Xxxxxx Xxxxx Xxxx, X.X.
Xxx 000, Xxxxx 00, Xxxxxx Xxxxx, XX 00000, Attn: Mr. Xxxxxxx Faith; and if to
the Trust, at 0000 Xxxx Xxxxxx, Xxxxx 000, Xxxxxx, XX 00000, Attn: Xx. Xxxx X.
Xxxxxxx or at such other address as such party may from time to time specify in
writing to the other party pursuant to this Article.
22. ASSIGNMENT.
This Agreement and the rights and duties hereunder shall not be assignable
by any party 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.
23. GOVERNING LAW.
This Agreement shall be construed in accordance with the laws of the
Commonwealth of Pennsylvania and the applicable provisions of the 1940 Act. To
the extent that the applicable laws of the Commonwealth of Pennsylvania, or any
of the provisions herein, conflict with the applicable provisions of the 1940
Act, the latter shall control.
24 COUNTERPARTS.
This Agreement may be executed in two or more counterparts, each of which
when so executed shall be deemed to be an original, but such counterparts shall
together constitute but one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed all as of the day and year first above written.
CRA FUND ADVISORS, INC. ATTEST
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By: Xxxx X. Xxxxxxx By: ____________________________
Principal Secretary
CITCO-QUAKER FUND SERVICES, INC. ATTEST
By: ------------------------------ ---------------------------------
Xxxxxxx Faith By: Xxxxxx X. Xxxx, Xx.
Chief Operating Officer Secretary
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SCHEDULE A
TO THE
MUTUAL FUND SERVICES AGREEMENT
BETWEEN
CRA FUND ADVISORS, INC.
AND
CITCO-QUAKER FUND SERVICES, INC.
DATED __________, 2003
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PORTFOLIOS CLASS A CLASS B NO-LOAD
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The CRA Qualified Investment Fund X
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SCHEDULE B
TO THE
INVESTMENT COMPANY SERVICES AGREEMENT
BETWEEN
CRA FUND ADVISORS, INC.
AND
CITCO-QUAKER FUND SERVICES, INC.
DATED ____________, 2003
ACCOUNTING SERVICES TO BE PROVIDED BY CITCO-QUAKER FUND SERVICES, INC. FOR THE
---------- ------------------------------------------------------ ------------
PORTFOLIOS OF THE CRA FUND ADVISORS, INC. AS SET FORTH ON SCHEDULE A ABOVE
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(a) Maintenance of Books and Records.
CQFS shall maintain and keep current the accounts, books, records and other
documents relating to the Trust's financial and portfolio transactions as
may be required by the rules and regulations of the Securities and Exchange
Commission (the "SEC") adopted under Section 31(a) of the 1940 Act. CQFS
shall cause the subject records of the Trust to be maintained and preserved
pursuant to the requirements of the 1940 Act.
(b) Performance of Daily Accounting Services.
In addition to the maintenance of the books and records specified above,
CQFS shall perform the following accounting services daily for each
Portfolio and provide such reports to any person designated to the Trust:
(i) Calculate the net asset value per share utilizing prices obtained
from the sources described in subsection (ii) below;
(ii) Obtain security prices from independent pricing services, or if such
quotes are unavailable, then obtain such prices from each
Portfolio's investment adviser or its designee as approved by the
Trust's Board of Trustees (hereafter referred to as " Trustees ");
(iii) Verify and reconcile with the Portfolios' custodian all daily trade
activity and reconcile cash balances;
(iv) Compute, as appropriate, each Portfolio's net income and capital
gains, dividend payables, dividend factors, yields, and weighted
average portfolio maturity;
(v) Prepare the daily the net asset value calculation and dividend
factor (if any) for each Portfolio 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 or such other exchange or reporting entity as is
approved by the Trustees;
(vi) Determine unrealized appreciation and depreciation on securities
held by the Portfolios;
(vii) Amortize premiums and accrete discounts on securities purchased at a
price other than face value, if requested by the Trust;
(viii) Update Trust accounting system to reflect rate changes, as received
from a Portfolio's investment adviser or designee, on variable
interest rate instruments;
(ix) Post Portfolio transactions to appropriate categories;
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(x) Accrue expenses of each Portfolio according to instructions received
from the Trust's administrator;
(xi) Determine the outstanding receivables and payables for all (1)
security trades, (2) Portfolio share transactions and (3) income and
expense accounts; and
(xii) Provide accounting reports in connection with the Trust's regular
annual audit, its semi-annual financial statement, and other audits
and examinations by regulatory agencies;
(xiii) Maintain a security reference master.
(c) Special Reports and Services.
(i) CQFS may provide additional special reports upon the request of the
Trust or a Portfolio's investment adviser or designee, which may
result in additional charges, the amount of which shall be agreed
upon between the parties prior to the provision of such special
report.
(ii) CQFS may provide such other similar services with respect to a
Portfolio as may be reasonably requested by the Trust, which may
result in an additional charge, the amount of which shall be agreed
upon between the parties prior to the provision of such service.
(d) Additional Accounting Services.
CQFS shall also perform the following additional accounting services for
each Portfolio:
(i) Provide monthly a set of financial statements for each Portfolio as
described below, upon request of the Trust: (1) Statement of Assets
and Liabilities (2) Statement of Operations (3) Statement of Changes
in Net Assets (4) Security Purchases and Sales Journals (5)
Portfolio Holdings Reports (6) the cash settlement (7) Schedule of
capital Gains and Losses and (8) custodial investment balance
reconciliations.
(ii) Provide accounting information for the following:
(A) federal and state income tax returns and federal excise tax
returns;
(B) the Trust's semi-annual reports with the SEC on Form N-SAR and
Form N-CSR;
(C) the Trust's annual, semi-annual and quarterly (if any)
shareholder reports;
(D) registration statements on Form N-1A and other filings relating
to the registration of shares;
(E) CQFS's monitoring of the Trust's status as a regulated
investment company under Subchapter M of the Internal Revenue
Code, as amended;
(F) annual audit by the Trust's auditors; and
(G) regular examinations performed by the SEC. Please note that if
an examination exceeds 5 business days in a single year,
additional charges may apply.
(III) MAINTAIN HISTORICAL TAX LOTS FOR EACH SECURITY, PROVIDED THAT CQFS
OBTAINS COMPLETE INFORMATION FROM THE PRIOR SERVICE PROVIDER AND
FURTHER PROVIDED THAT THE ADVISOR TO THE FUND INFORMS CQFS OF THE
METHOD OF ACCOUNTING TO BE USED.
(IV) PREPARE MONTHLY BROKER SECURITY TRANSACTION SUMMARIES.
13
SCHEDULE C
TO THE
INVESTMENT COMPANY SERVICES AGREEMENT
BETWEEN
CRA FUND ADVISORS, INC.
AND
CITCO-QUAKER FUND SERVICES, INC.
DATED ____________, 2003
ADMINISTRATIVE SERVICES TO BE PROVIDED BY CITCO-QUAKER FUND SERVICES, INC. FOR
--------------------------------------------------------------------------------
THE PORTFOLIOS OF THE CRA FUND ADVISORS, INC. AS SET FORTH ON SCHEDULE A ABOVE
------------------------------------------------------------------------------
CQFS shall provide the Trust with regulatory reporting services; shall
provide all necessary office space, equipment, personnel, compensation and
facilities for handling the affairs of the Trust; and shall provide such other
services as the Trust may request that CQFS perform consistent with its
obligations under this Agreement. CQFS does not provide legal services to the
Trust, and the Trust should always consult its own counsel with respect to
regulatory issues and compliance. Without limiting the generality of the
foregoing, CQFS shall:
(a) calculate Trust expenses and administer all disbursements for the
Trust, and as appropriate compute the Trust's yields, total return,
net asset value, expense ratios and portfolio turnover rate;
(b) cooperate, in consultation with the Trust and Trust counsel, in the
printing and distribution of prospectuses, statements of additional
information, registration statements and proxy materials;
(c) prepare such reports, notice filing forms and other documents
(including reports regarding the sale and redemption of shares of the
Trust as may be required in order to comply with federal and state
securities law) as may be necessary to make notice filings relating to
the Trust's shares with federal and state securities authorities,
monitor the sale of Trust shares for compliance with federal and state
securities laws regarding registration, and file with the appropriate
federal and state securities authorities administrative, compliance
filings as may be necessary or convenient to enable the Trust to make
a continuous offering of its shares; provided that CQFS shall not
prepare any documents requiring a legal opinion or constituting legal
work;
(d) coordinate the mailing of prospectuses, notices, proxy statements,
proxies and other reports to Trust shareholders, and supervise and
facilitate the proxy solicitation process for all shareholder
meetings, assisting trust counsel in the preparation of proxy
materials, including the tabulation of shareholder votes;
(e) administer contracts and calculate expenses payable on behalf of the
Trust with the Trust's investment adviser, sub-advisers, distributor,
custodian, and other service providers;
(f) supervise the Trust's transfer agent with respect to the payment of
dividends and other distributions to shareholders;
14
(g) calculate performance data of the Trust for dissemination to outlets
which the Trust may from time to time direct;
(h) assist with the layout and printing of shareholder communications,
including prospectuses and supplements thereto, and assist with and
coordinate layout and printing of the Trust's semi-annual and annual
reports to shareholders;
(i) provide individuals acceptable to the Trustees to serve as officers of
the Trust, who may be responsible for the management of certain
administrative portions of the Trust's affairs as may determined by
the Trustees, except for certain legal and compliance matters not
specifically addressed herein;
(j) undertake to use its best efforts to locate and timely pay premiums
for fidelity bonds and Trustees and officers/errors and omissions
insurance policies for the Trust in accordance with the requirements
of the 1940 Act and as such bonds and policies are approved by the
Trustees;
(k) monitor for the Trust and its Portfolios their registered investment
company status under Subchapter M of the Internal Revenue Code of 1986
by reviewing the allocation of securities in each portfolio and advise
the Trust if any Portfolio fails to meet the requirements and monitor
the Trust's compliance with the investment restrictions and
limitations imposed by the 1940 Act and the applicable regulations
thereunder and the fundamental and non-fundamental fund investment
limitations listed in the Trust's Prospectus and Statement of
Additional Information.);
(l) monitor and pay Trust bills, maintain Trust's budget and report budget
expenses and variances to Trust management;
(m) provide coordination of meetings and preparation of materials for the
quarterly and special meetings of the Trustees and special meetings of
the Trust's shareholders;
(n) cooperate with, and take all reasonable actions in the performance of
its duties under this Agreement to ensure that all necessary
information is made available to the Trust's independent public
accountants in connection with the preparation of any audit or report
requested by the Trust;
(o) cooperate with, and take all reasonable actions in the performance of
its duties under this Agreement to ensure that the necessary
information is made available to the Securities and Exchange
Commission (the "SEC") or any other regulatory authority in connection
with any regulatory audit of the Trust;
(p) perform all administrative services and functions of the Trust to the
extent administrative services and functions are not provided to the
Trust by other agents of the Trust, which are reasonably requested by
the Trustees in connection with the performance of their duties;
(q) prepare and file with the SEC the annual and semi-annual report for
the Trust on Form N-SAR, Form N-CSR and all required notices pursuant
to Rule 24f-2, or 17g-1;
(r) file any post-effective amendments under the Securities Act of 1933
prepared by Trust Counsel.
(s) Assist in the administration of the Trust's Code of Ethics.
15
SCHEDULE D
TO THE
INVESTMENT COMPANY SERVICES AGREEMENT
BETWEEN
CRA FUND ADVISORS, INC.
AND
CITCO-QUAKER FUND SERVICES, INC.
DATED ____________, 2003
TRANSFER AGENCY SERVICES TO BE PROVIDED BY CITCO-QUAKER FUND SERVICES, INC. FOR
--------------------------------------------------------------------------------
THE PORTFOLIOS OF THE CRA FUND ADVISORS, INC. AS SET FORTH ON SCHEDULE A ABOVE
------------------------------------------------------------------------------
(a) Shareholder Transactions
------------------------
(i) Process shareholder purchase and redemption orders and wire
orders in accordance with conditions set forth in the Trust's
prospectus.
(ii) Set up account information, including address, dividend option,
taxpayer identification numbers and wire instructions, and
maintain certain other information as may be requested by the
Trust, provided that such information may be obtained from the
Trust's prior service providers.
(iii) Issue confirmations to shareholders in compliance with Rule
10b-10 under the Securities Exchange Act of 1934, as amended
(the "1934 Act").
(iv) Issue periodic statements for shareholders.
(v) Process transfers and exchanges.
(vi) Act as a service agent and process dividend payments, including
the purchase of new shares, through dividend reimbursement.
(vii) Record the issuance of shares and maintain pursuant to Rule
17Ad-10(e) of the 1934 Act a record of the total number of
shares of each Portfolio which are authorized, based upon data
provided to it by the Trust, and issued and outstanding.
(viii) Perform such services as are required to comply with Rules
17a-24 and 17Ad-17 of the 1934 Act (the "Lost Shareholder
Rules").
(ix) Administer and/or perform all other customary services of a
transfer agent.
(x) Prepare and mail confirmation statements to dealers in
accordance with Regulation T, Rule 10b-10 and any other
applicable rules or regulations.
(xi) Maintain all shareholder records, including account
applications and transaction history as may be required by the
rules and regulations of the Securities and Exchange Commission
(the
16
"SEC") adopted under Section 31(a) of the 1940 Act. CQFS shall
cause the subject records of the Trust to be maintained and
preserved pursuant to the requirements of the 1940 Act.
(b) Shareholder Information Services
--------------------------------
(i) Make information available to shareholder servicing units and
other remote access units regarding trade date, share price,
current holdings, yields, and dividend information.
(ii) Produce a reasonable amount of detailed transaction history
through duplicate or special order statements upon request.
CQFS reserves the right to charge extra if these requests
exceed 300 shareholders per quarter.
(iii) Provide mailing labels for distribution of financial reports,
prospectuses, proxy statements or marketing material to current
shareholders.
(iv) Respond to all inquiries and communications from shareholders
relating to shareholder accounts.
(c) Compliance Reporting
--------------------
(i) Provide reports to the Securities and Exchange Commission and
the states in which the Portfolios are registered.
(ii) Prepare and distribute appropriate Internal Revenue Service
forms for shareholder income and capital gains.
(iii) Issue tax withholding reports to the Internal Revenue Service.
(d) Dealer/Load Processing (if applicable)
--------------------------------------
(i) Provide reports for tracking rights of accumulation and
purchases made under a Letter of Intent.
(ii) Account for separation of shareholder investments from
transaction sale charges for purchase of Portfolio shares.
(iii) Calculate fees due under 12b-1 plans for distribution and
marketing expenses.
(iv) Track sales and commission statistics by dealer and provide for
payment of commissions on direct shareholder purchases in a
load Portfolio.
(e) Shareholder Account Maintenance
-------------------------------
(i) Maintain all shareholder records for each account in each
Portfolio.
(ii) Issue customer statements on scheduled cycle, providing
duplicate second and third party copies if required.
17
(iii) Record shareholder account information changes.
(iv) Maintain account documentation files for each shareholder.
CQFS shall perform such other services for the Trust that are mutually
agreed upon by the parties from time to time either at no additional fees or for
such reasonable and customary fees as are mutually agreed upon by the parties;
provided, however that the Trust or CQFS may retain third parties to perform
such other services. Such services may include performing internal audit
examination; mailing the annual reports of the Portfolios; and mailing notices
of shareholders' meetings, proxies and proxy statements, for all of which the
Trust will pay CQFS's out-of-pocket expenses.
18
SCHEDULE E
TO THE
INVESTMENT COMPANY SERVICES AGREEMENT
BETWEEN
CRA FUND ADVISORS, INC.
AND
CITCO-QUAKER FUND SERVICES, INC.
DATED JULY 1, 2001
PROPOSED PRICING SCHEDULE
FOR ADMINISTRATION SERVICES
CITCO-Quaker Fund Services will provide all of the services described in
Schedule B herein, to all Portfolios listed on Schedule A herein, for the
following fees:
--------------------------------------------------------------------------------
AVERAGE DAILY NET ASSETS ANNUALIZED FEES
--------------------------------------------------------------------------------
On The First $250 Million in Aggregate Assets 0.075%
--------------------------------------------------------------------------------
On All Aggregate Assets In Excess of $250 Million 0.05%
--------------------------------------------------------------------------------
The above fees include 100 portfolio trades per month, based on the single
Portfolio of the Trust (exclusive of daily cash investments). Portfolios
executing more than 100 portfolio trades per month will be charged $5 per trade
for each trade in excess of 100. Fees are based on the assets in the existing
single portfolio.
The Trust will be subject to either a $75,000 minimum annual fee or applicable
scheduled fees as noted above, which ever is greater.
In addition to the above fees, each Portfolio will reimburse CITCO-Quaker for
the costs of the daily portfolio price quotation services utilized by the
Portfolio(s).
OUT-OF-POCKET EXPENSES:
In addition to the above fees, the Trust will reimburse CQFS or pay directly
certain out-of-pocket expenses incurred on the Portfolio's behalf, including but
not limited to; postage and mailing preparation, photocopying, supplies, record
storage, special and unique programming, confirmations and statements, Blue Sky
fees, applicable Imaging fees, any third party links, printing, telephone lines
and VRU services, Citrix link to Transfer Agency system, internet architecture
and access fees, DST FanMail or other similar reporting services, bank service
charges, associated fees of NSCC trading, other industry standard transfer
agency expenses, travel expenses and any other expenses approved by the
Portfolio(s) or an Adviser thereto. Each Portfolio will also be responsible for
its normal operating expenses, such as federal and state filing fees, insurance
premiums, typesetting and printing of the Portfolio's public documents, and fees
and expenses of each Portfolio's other vendors and providers.
TERM OF PROPOSAL:
This pricing schedule is good for a period of 30 days from the date captioned
above.
19
CHANGE OF TERMS:
This schedule is based upon the current requirements of the Trust, as set forth
in the Prospectus and Statement of Additional Information (SAI). Any material
changes to the Prospectus or SAI, including but not limited to the addition of
Portfolios, a material and sudden change to the assets under management or to
the minimum investment amount, constitutes a material change to this Agreement.
If such changes occur, the parties will modify this schedule in accordance with
the terms of Paragraph 3 of the Mutual Fund Services Agreement.
20
