FUND ACCOUNTING
SERVICING AGREEMENT
THIS
AGREEMENT is made and entered into as of this 16th day of November, 2004, by
and between Intrepid Capital Management Funds Trust, a Delaware statutory
trust (the “Trust”) and U.S. Bancorp Fund Services, LLC, a Wisconsin
limited liability company (“USBFS”).
WHEREAS,
the Trust is registered under the Investment Company Act of 1940, as amended (the “1940
Act”), as an open-end management investment company, and is authorized to issue
shares of beneficial interest in separate series, with each such series representing
interests in a separate portfolio of securities and other assets;
WHEREAS,
USBFS is, among other things, in the business of providing mutual fund accounting
services to investment companies; and
WHEREAS,
the Trust desires to retain USBFS to provide accounting services to each series of the
Trust listed on Exhibit A hereto (as amended from time to time) (each a “Fund”,
collectively the “Funds”).
NOW,
THEREFORE, in consideration of the promises and mutual covenants herein contained, and
other good and valuable consideration, the receipt of which is hereby acknowledged, the
parties hereto, intending to be legally bound, do hereby agree as follows:
| 1. |
Appointment
of USBFS as Fund Accountant |
| |
The
Trust hereby appoints USBFS as fund accountant of the Trust on the terms and conditions
set forth in this Agreement, and USBFS hereby accepts such appointment and agrees to
perform the services and duties set forth in this Agreement. |
| 2. |
Services
and Duties of USBFS |
| |
USBFS
shall provide the following fund accounting services for the Funds, including but not
limited to: |
| |
A. |
Portfolio
Accounting Services: |
| |
(1) |
Maintain
portfolio records on a trade date+1 basis using security trade information
communicated from the investment adviser. |
| |
(2) |
For
each valuation date, obtain prices from a pricing source approved by the Board
of Trustees of the Trust (the “Board of Trustees” or the “Trustees”)
and apply those prices to the portfolio positions. For those securities where
market quotations are not readily available, the Board of Trustees shall
approve, in good faith, procedures for determining the fair value for such
securities. |
1
| |
(3) |
Identify
interest and dividend accrual balances as of each valuation date and calculate
gross earnings on investments for the accounting period. |
| |
(4) |
Determine
gain/loss on security sales and identify them as short-term or long-term;
account for periodic distributions of gains or losses to shareholders and
maintain undistributed gain or loss balances as of each valuation date. |
| |
B. |
Expense
Accrual and Payment Services: |
| |
(1) |
For
each valuation date, calculate the expense accrual amounts as directed by the
Trust as to methodology, rate or dollar amount. |
| |
(2) |
Record
payments for Fund expenses upon receipt of written authorization from the
Trust. |
| |
(3) |
Account
for Fund expenditures and maintain expense accrual balances at the level of
accounting detail, as agreed upon by USBFS and the Trust. |
| |
(4) |
Provide
expense accrual and payment reporting. |
| |
C. |
Fund
Valuation and Financial Reporting Services: |
| |
(1) |
Account
for Fund share purchases, sales, exchanges, transfers, dividend reinvestments,
and other Fund share activity as reported by the Fund’s transfer agent on
a timely basis. |
| |
(2) |
Apply
equalization accounting as directed by the Trust. |
| |
(3) |
Determine
net investment income (earnings) for the Fund as of each valuation date.
Account for periodic distributions of earnings to shareholders and maintain
undistributed net investment income balances as of each valuation date. |
| |
(4) |
Maintain
a general ledger and other accounts, books, and financial records for the Fund
in the form as agreed upon. |
| |
(5) |
Determine
the net asset value of the Fund according to the accounting policies and
procedures set forth in the Fund’s Prospectus. |
| |
(6) |
Calculate
per share net asset value, per share net earnings, and other per share amounts
reflective of Fund operations at such time as required by the nature and
characteristics of the Fund. |
2
| |
(7) |
Communicate,
at an agreed upon time, the per share price for each valuation date to parties
as agreed upon from time to time. |
| |
(8) |
Prepare
monthly reports that document the adequacy of accounting detail to support
month-end ledger balances. |
| |
D. |
Tax
Accounting Services: |
| |
(1) |
Maintain
accounting records for the investment portfolio of the Fund to support the tax
reporting required for IRS-defined regulated investment companies. |
| |
(2) |
Maintain
tax lot detail for the Fund’s investment portfolio. |
| |
(3) |
Calculate
taxable gain/loss on security sales using the tax lot relief method designated
by the Trust. |
| |
(4) |
Provide
the necessary financial information to support the taxable components of income
and capital gains distributions to the Fund’s transfer agent to support
tax reporting to the shareholders. |
| |
E. |
Compliance
Control Services: |
| |
(1) |
Support
reporting to regulatory bodies and support financial statement preparation by
making the Fund’s accounting records available to the Trust, the
Securities and Exchange Commission (the “SEC”), and the outside
auditors. |
| |
(2) |
Maintain
accounting records according to the 1940 Act and regulations provided
thereunder. |
| |
F. |
USBFS
will perform the following accounting functions on a daily basis: |
| |
(1) |
Reconcile
cash and investment balances of each Fund with the Fund’s custodian, and
provide the Fund’s investment adviser with the beginning cash balance
available for investment purposes. |
| |
(2) |
Transmit
or mail a copy of the portfolio valuation to the Fund’s investment
adviser. |
| |
(3) |
Review
the impact of current day’s activity on a per share basis, and review
changes in market value. |
3
| |
G. |
In
addition, USBFS will: |
| |
(1) |
Prepare
monthly security transactions listings. |
| |
(2) |
Supply
various Trust, Fund and class statistical data as requested by the Trust on an
ongoing basis. |
| |
For
each valuation date, USBFS shall obtain prices from a pricing source recommended by USBFS
and approved by the Board of Trustees and apply those prices to the portfolio positions
of the Fund. For those securities where market quotations are not readily available, the
Board of Trustees shall approve, in good faith, procedures for determining the fair value
for such securities. |
| |
If
the Trust desires to provide a price that varies from the pricing source, the Trust shall
promptly notify and supply USBFS with the valuation of any such security on each
valuation date. All pricing changes made by the Trust will be in writing and must
specifically identify the securities to be changed by CUSIP, name of security, new price
or rate to be applied, and, if applicable, the time period for which the new price(s)
is/are effective. |
| 4. |
Changes
in Accounting Procedures |
| |
Any
resolution passed by the Board of Trustees that affects accounting practices and
procedures under this Agreement shall be effective upon written receipt and acceptance by
USBFS. |
| 5. |
Changes
in Equipment, Systems, Service, Etc. |
| |
USBFS
reserves the right to make changes from time to time, as it deems advisable, relating to
its services, systems, programs, rules, operating schedules and equipment, so long as
such changes do not adversely affect the service provided to the Trust under this
Agreement. |
| |
USBFS
shall be compensated for providing the services set forth in this Agreement in accordance
with the fee schedule set forth on Exhibit B hereto (as amended from time to time). The
Trust shall pay all fees and reimbursable expenses within thirty (30) calendar days
following receipt of the billing notice, except for any fee or expense subject to a good
faith dispute. The Trust shall notify USBFS in writing within thirty (30) calendar days
following receipt of each invoice if the Trust is disputing any amounts in good faith.
The Trust shall settle such disputed amounts within ten (10) calendar days of the day on
which the parties agree to the amount to be paid. With the exception of any fee or
expense the Trust is disputing in good faith as set forth above, unpaid invoices shall
accrue a finance charge of one and one-half percent (1½%) per month, after the due
date. Notwithstanding anything to the contrary, amounts owed by the Trust to USBFS shall
only be paid out of the assets and property of the particular Fund involved. |
4
| 7. |
Indemnification;
Limitation of Liability |
| |
A. |
USBFS
shall exercise reasonable care in the performance of its duties under this
Agreement. USBFS shall not be liable for any error of judgment or
mistake of law or for any loss suffered by the Trust in connection
with matters to which this Agreement relates, including losses
resulting from mechanical breakdowns or the failure of communication
or power supplies beyond USBFS’s control, except a loss arising
out of or relating to USBFS’s refusal or failure to comply with
the terms of this Agreement or from bad faith, negligence, or willful
misconduct on its part in the performance of its duties under this
Agreement. Notwithstanding any other provision of this Agreement, if
USBFS has exercised reasonable care in the performance of its duties
under this Agreement, the Trust shall indemnify and hold harmless
USBFS from and against any and all claims, demands, losses, expenses,
and liabilities of any and every nature (including reasonable
attorneys’ fees) that USBFS may sustain or incur or that may be
asserted against USBFS by any person arising out of any action taken
or omitted to be taken by it in performing the services hereunder,
except for any and all claims, demands, losses, expenses, and
liabilities arising out of or relating to USBFS’s refusal or
failure to comply with the terms of this Agreement or from bad faith,
negligence or from willful misconduct on its part in performance of
its duties under this Agreement, (i) in accordance with the foregoing
standards, or (ii) in reliance upon any written or oral instruction
provided to USBFS by any duly authorized officer of the Trust, such
duly authorized officer to be included in a list of authorized
officers furnished to USBFS and as amended from time to time in
writing by resolution of the Board of Trustees. |
| |
USBFS
shall indemnify and hold the Trust harmless from and against any and all claims, demands,
losses, expenses, and liabilities of any and every nature (including reasonable attorneys’ fees)
that the Trust may sustain or incur or that may be asserted against the Trust by any
person arising out of any action taken or omitted to be taken by USBFS as a result of
USBFS’s refusal or failure to comply with the terms of this Agreement, its bad
faith, negligence, or willful misconduct. |
| |
In
the event of a mechanical breakdown or failure of communication or power supplies beyond
its control, USBFS shall take all reasonable steps to minimize service interruptions for
any period that such interruption continues beyond USBFS’s control. USBFS will make
every reasonable effort to restore any lost or damaged data and correct any errors
resulting from such a breakdown at the expense of USBFS. USBFS agrees that it shall, at
all times, have reasonable contingency plans with appropriate parties, making reasonable
provision for emergency use of electrical data processing equipment to the extent
appropriate equipment is available. Representatives of the Trust shall be entitled to
inspect USBFS’s premises and operating capabilities at any time during regular
business hours of USBFS, upon reasonable notice to USBFS. |
5
| |
Notwithstanding
the above, USBFS reserves the right to reprocess and correct administrative errors at its
own expense. |
| |
B. |
In
order that the indemnification provisions contained in this section shall
apply, it is understood that if in any case the indemnitor may be
asked to indemnify or hold the indemnitee harmless, the indemnitor
shall be fully and promptly advised of all pertinent facts concerning
the situation in question, and it is further understood that the
indemnitee will use all reasonable care to notify the indemnitor
promptly concerning any situation that presents or appears likely to
present the probability of a claim for indemnification. The indemnitor
shall have the option to defend the indemnitee against any claim that
may be the subject of this indemnification. In the event that the
indemnitor so elects, it will so notify the indemnitee and thereupon
the indemnitor shall take over complete defense of the claim, and the
indemnitee shall in such situation initiate no further legal or other
expenses for which it shall seek indemnification under this section.
Indemnitee shall in no case confess any claim or make any compromise
in any case in which the indemnitor will be asked to indemnify the
indemnitee except with the indemnitor’s prior written consent. |
| 8. |
Proprietary
and Confidential Information |
| |
USBFS
agrees on behalf of itself and its directors, officers, and employees to treat
confidentially and as proprietary information of the Trust all records and other
information relative to the Trust and prior, present, or potential shareholders of the
Trust (and clients of said shareholders), and not to use such records and information for
any purpose other than the performance of its responsibilities and duties hereunder,
except after prior notification to and approval in writing by the Trust, which approval
shall not be unreasonably withheld and may not be withheld where USBFS may be exposed to
civil or criminal contempt proceedings for failure to comply, when requested to divulge
such information by duly constituted authorities, or when so requested by the Trust. |
| |
Further,
USBFS will adhere to the privacy policies adopted by the Trust pursuant to Title V of the
Xxxxx-Xxxxx-Xxxxxx Act, as may be modified from time to time (the “Act”).
Notwithstanding the foregoing, USBFS will not share any nonpublic personal information
concerning any of the Trust’s shareholders to any third party unless specifically
directed by the Trust or allowed under one of the exceptions noted under the Act. |
6
| 9. |
Term
of Agreement; Amendment |
| |
This
Agreement shall become effective as of the date first written above and will continue in
effect for a period of three years. Subsequent to the initial three-year term, this
Agreement may be terminated by either party upon giving ninety (90) days prior written
notice to the other party or such shorter period as is mutually agreed upon by the
parties. However, this Agreement may be amended by mutual written consent of the parties. |
| |
USBFS
shall keep records relating to the services to be performed hereunder in the form and
manner, and for such period, as it may deem advisable and is agreeable to the Trust, but
not inconsistent with the rules and regulations of appropriate government authorities, in
particular, Section 31 of the 1940 Act and the rules thereunder. USBFS agrees that all
such records prepared or maintained by USBFS relating to the services to be performed by
USBFS hereunder are the property of the Trust and will be preserved, maintained, and made
available in accordance with such applicable sections and rules of the 1940 Act and will
be promptly surrendered to the Trust on and in accordance with its request. |
| |
This
Agreement shall be construed in accordance with the laws of the State of Wisconsin,
without regard to conflicts of law principles. To the extent that the applicable laws of
the State of Wisconsin, or any of the provisions herein, conflict with the applicable
provisions of the 1940 Act, the latter shall control, and nothing herein shall be
construed in a manner inconsistent with the 1940 Act or any rule or order of the SEC
thereunder. |
| 12. |
Duties
in the Event of Termination |
| |
In
the event that, in connection with termination, a successor to any of USBFS’s duties
or responsibilities hereunder is designated by the Trust by written notice to USBFS,
USBFS will promptly, upon such termination and at the expense of the Trust, transfer to
such successor all relevant books, records, correspondence and other data established or
maintained by USBFS under this Agreement in a form reasonably acceptable to the Trust (if
such form differs from the form in which USBFS has maintained the same, the Trust shall
pay any expenses associated with transferring the same to such form), and will cooperate
in the transfer of such duties and responsibilities, including provision for assistance
from USBFS’s personnel in the establishment of books, records and other data by such
successor. |
7
| 13. |
No
Agency Relationship |
| |
Nothing
herein contained shall be deemed to authorize or empower USBFS to act as agent for the
other party to this Agreement, or to conduct business in the name, or for the account, of
the other party to this Agreement. |
| 14. |
Data
Necessary to Perform Services |
| |
The
Trust or its agent shall furnish to USBFS the data necessary to perform the services
described herein at such times and in such form as mutually agreed upon. If USBFS is also
acting in another capacity for the Trust, nothing herein shall be deemed to relieve USBFS
of any of its obligations in such capacity. |
| 15. |
Notification
of Error |
| |
The
Trust will notify USBFS of any discrepancy between USBFS and the Trust, including, but
not limited to, failing to account for a security position in the fund’s portfolio,
by the later of: within three (3) business days after receipt of any reports rendered by
USBFS to the Trust; within three (3) business days after discovery of any error or
omission not covered in the balancing or control procedure, or within three (3) business
days of receiving notice from any shareholder. |
| |
This
Agreement may not be assigned by either party without the prior written consent of the
other party. |
| |
Any
notice required or permitted to be given by either party to the other shall be in writing
and shall be deemed to have been given on the date delivered personally or by courier
service, or three (3) days after sent by registered or certified mail, postage prepaid,
return receipt requested, or on the date sent and confirmed received by facsimile
transmission to the other party’s address set forth below: |
| |
Notice
to USBFS shall be sent to: |
| |
U.S.
Bancorp Fund Services, LLC
000 Xxxx Xxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000 |
8
| |
and
notice to the Trust shall be sent to: |
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by a duly
authorized officer on one or more counterparts as of the date first above written.
9
Fund Names
Separate Series of
Intrepid Capital Management Funds Trust
|
|
| Name of Series |
Date Added |
Intrepid Capital Fund |
10
FUND ACCOUNTING
SERVICES
ANNUAL FEE SCHEDULE
|
|
| Domestic Equity Funds* |
Multiple Classes |
| $30,000 for the first $100 million |
Each class is an additional 25% of the charge of the initial |
| 1.25 basis point on the next $200 million |
class. |
| .75 basis point on the balance |
|
Master/Feeder Funds |
| Domestic Balanced Funds* |
Each master and feeder is charged according to the schedule. |
| $33,000 for the first $100 million |
| 1.5 basis points on the next $200 million |
Multiple Manager Funds |
| 1 basis point on the balance |
Additional base fee: |
|
$12,000 per manager/sub-advisor per fund |
| Domestic Fixed Income Funds* |
| Funds of Funds* |
Extraordinary services - quoted separately |
| Short or Derivative Funds* |
| International Equity Funds* |
Conversion Estimate - one month's fee (if necessary) |
| Tax-exempt Money Market Funds* |
| $39,000 for the first $100 million |
NOTE - All schedules subject to change depending upon the use |
| 2 basis points on the next $200 million |
of derivatives - options, futures, short sales, etc. |
| 1 basis point on the balance |
|
All fees are billed monthly plus out-of-pocket expenses, |
| Taxable Money Market Funds* |
including pricing, corporate action, and factor services: |
| $39,000 for the first $100 million |
| 1 basis point on the next $200 million |
• $.15 Domestic and Canadian Equities |
| 1/2 basis point on the balance |
• $.15 Options |
|
• $.50 Corp/Gov/Agency Bonds |
| International Income Funds* |
• $.80 CMO's |
| $42,000 for the first $100 million |
• $.50 International Equities and Bonds |
| 3 basis points on the next $200 million |
• $.80 Municipal Bonds |
| 1.5 basis points on the balance |
• $.80 Money Market Instruments |
|
• $125 /fund/month - Mutual Fund Pricing |
|
• $2.00 /equity Security/Month Corporate Actions |
|
• $125 /month Manual Security Pricing (>10/day) |
|
• Factor Services (BondBuyer) |
|
• $1.50 /CMO/month |
| * Subject to CPI increase, Milwaukee MSA |
• $.25 /Mortgage Backed/month |
|
• $300 /month Minimum Per Fund Group |
11
