Exhibit 23H-
MUTUAL FUND SERVICES AGREEMENT
THIS AGREEMENT is made as of this 1st day of September, 2001, by and
between the Penn Street Funds, Inc. (the "Trust"), Maryland corporation having
its principal place of business at 00 Xxxxxx Xxxxxx Xxxxxxx, Xxxxx Xxxxxx
Corporate Center, Malvern, PA 19355 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, Xxxxx 00,
Xxxxxx Xxxxx, XX 00000.
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 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, fund
accounting, and administrative services for each Portfolio of the Trust listed
on Schedule A, and such Portfolios as may be added to Schedule A from time to
time; 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 by mutual
agreement of the parties. CQFS hereby accepts such employment to perform such
duties.
2. SUBCONTRACTING.
CQFS may, at its expense and, upon written notice to the Trust, subcontract
with any entity or person concerning the provision of the services contemplated
hereunder; 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 C
attached hereto, as such Schedule C may be amended from time to time by
agreement of the parties.
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 promptly.
4. REIMBURSEMENT OF EXPENSES.
In addition to paying CQFS the fees described in Schedule C 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 expenses incurred by CQFS to provide access to
the Trust's shareholders pursuant to legal requirements or at the
express direction of the Trust with its prior approval of such
expenses;
(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
(f) Any additional expenses reasonably incurred by CQFS in the performance
of its duties and obligations under this Agreement, subject to the
prior approval of the Trust.
CQFS will obtain the prior approval of the Trust before incurring any out
of pocket expense relating to any unusual or non-recurring item or expenditure.
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, for a period of three
years. 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 by
the party alleging cause.
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
from the non-breaching party;
(ii) an act or omission of a party to this Agreement 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;
(iv) a final, non-appealable 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
(v) 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 the
modification or alteration of the rights of creditors.
Notwithstanding the foregoing, in the event this Agreement is terminated
and for any reason 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 C, the amount of
all of CQFS's cash disbursements 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.
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,
commission of a material breach of this Agreement that has not been remedied
within thirty (30) days following written notice of such breach from the
non-breaching party 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 losses beyond its reasonable
control, provided that CQFS has acted in accordance with the standard of care
set forth above; and (ii) 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 or its own counsel, 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
reasonable 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; provided, however that the Trust shall have no obligation
to indemnify or reimburse CQFS under this Article 8 to the extent that CQFS is
entitled to reimbursement or indemnification for such Losses under any liability
insurance policy described in this Agreement or otherwise. 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).
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 (i) any request or
direction of CQFS to the Trust upon which the Trust agreed to in reliance on the
reasonable advice of CQFS, (ii) upon any instruction, notice or other instrument
that the Trust reasonably believes to be genuine and to have been signed or
presented by a duly authorized representative of CQFS (other than an employee or
other affiliated person of the Trust who may otherwise be named as an authorized
representative of the CQFS for certain purposes); or (iii) CQFS's own willful
misfeasance, bad faith, negligence in the performance of its duties, 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.).
If a claim is made against any party to this Agreement as to which that
party may seek indemnity under this Article 8 from the other party, the party
seeking indemnification shall notify the other party within ten (10) days after
receipt of any written assertion of such claim threatening to institute an
action or proceeding or service of summons or other legal process. Failure to
notify a party of a claim for indemnification will relieve the party from whom
indemnification is sought from any liability which it may have on account of the
indemnity provisions set forth under this Article 8 unless the party seeking
indemnification can demonstrate to the reasonable satisfaction of the other
party that such party has not been prejudiced in any material respect by such
failure to so notify.
The parties to this Agreement will cooperate in the control of the defense
of any action, suit or proceeding in a party is involved and for which indemnity
is being provided by the other party. 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, but not the obligation, to
participate in the defense or settlement of a claim, action or proceeding with
its own counsel. Costs or expenses incurred by a party to whom indemnification
is being provided in connection with, or as a result of such participation, will
be borne solely by that party unless:
(i) the party seeking indemnification has received an opinion of
counsel from counsel to the other party stating that the use of
common counsel would present an impermissible conflict of
interest;
(ii) 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
(iii) the party from whom indemnification is sought authorizes the
other party to employ separate counsel at the expense of the
indemnifying party.
(iv) 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.
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 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.
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, and (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.
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
attributable to fire, theft, or any other cause the records, and other data of
the Trust and 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
appropriate regulatory agency as a transfer agent and such registration will
remain in full force and effect for the duration of this Agreement, and (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, and that
it has implemented adequate procedures to control, monitor and maintain the
privacy of the Trust's non-public client information as required by applicable
law
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 therefor. 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,
and shall notify the
Trust from time to time as may be appropriate of the total outstanding claims
made by CQFS under its insurance coverage. 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.
16. 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. Copies of the Trust's 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) Copies of the Prospectus and Statement of Additional Information for
each Portfolio.
17. 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.
For special cases, the parties hereto may amend such procedures set forth
herein as may be appropriate or practical under the circumstances, and CQFS may
conclusively assume that any special procedure which has been approved by the
Trust does not conflict with or violate any requirements of its CQFS of Trust or
then current prospectuses, or any rule, regulation or requirement of any
regulatory body.
18. 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 no shares of the Trust will
be offered to the public until the Trust's registration statement under the
Securities Act and the 1940 Act has been declared or becomes effective.
19. 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, Xxxxx
00, Xxxxxx Xxxxx, XX 00000, Attn: Mr. Xxxxx Xxxxx; and if to the Trust, at 30
Great Valley Stream Parkway, Xxxxx Xxxxxx Xxxxxxxxx Xxxxxx, Xxxxxxx, XX 00000,
Attn: Xx. Xxxxxx X. Xxxxxxxx; or at such other address as such party may from
time to time specify in writing to the other party pursuant to this Article.
20. 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.
21. 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.
22. MULTIPLE ORIGINALS.
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.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed all as of the day and year first above written.
THE PENN STREET FUND, INC. ATTEST
_________________________ _________________________________
By: G. Xxxxxxx Xxxx, Jr. By: Xxxxxx Xxxxxxxx
President Secretary
CITCO-QUAKER FUND SERVICES, INC. ATTEST
By:
--------------------- ---------------------------------
Xxxxx X. Xxxxx By: Xxxxxx X. Xxxx
President Secretary
SCHEDULE A
TO THE
MUTUAL FUND SERVICES AGREEMENT
BETWEEN
THE PENN STREET FUND, INC.
AND
CITCO-QUAKER FUND SERVICES, INC.
Dated September 1, 2001
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PORTFOLIOS No-Load
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XxXxxxx Balanced Fund X
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Walnut Asset Management Equity Portfolio X
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Cumberland Taxable income Portfolio X
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Xxxxxxx Large-Cap Growth Portfolio X
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Penn Street Advisors Sector Protfolio X
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SCHEDULE B
TO THE
MUTUAL FUND SERVICES AGREEMENT
------------------------------
BETWEEN
THE PENN STREET FUND, INC.
AND
CITCO-QUAKER FUND SERVICES, INC.
Dated September 1, 2001
Accounting Services to be Provided By
CITCO-Quaker Fund Services, Inc.
for the Portfolios of The Penn Street Fund, Inc.
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(a) Maintenance of Books And Records.
CQFSshall 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:
(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
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;
(iv) Compute, as appropriate, each Portfolio's net income and capital
gains, dividend payables, dividend factors, yields, and weighted
average portfolio maturity;
(v) Review 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;
(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;
(xii) Provide accounting reports in connection with the Trust's
regular annual audit and other audits and examinations by
regulatory agencies; and
(xiii)Provide such periodic reports as the parties shall agree upon.
(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 (or as frequently as may reasonably be requested
by the Trust or a Portfolio's investment adviser) 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
(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;
(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) examinations performed by the SEC.
Administrative Services to be Provided By
CITCO-Quaker Fund Services, Inc.
for the Portfolios of The Penn Street Fund, Inc.
------------------------------------------------
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. 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,
expense ratios and portfolio turnover rate;
(b) cooperate, in consultation with the Trust and Trust counsel, in the
preparation 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 or desirable to make notice
filings relating to the Trust's shares with state securities
authorities, monitor the sale of Trust shares for compliance with
state securities laws, and file with the appropriate state securities
authorities compliance filings as may be necessary or convenient to
enable the Trust to make a continuous offering of its shares;
(d) develop and prepare, with the assistance of the Trust, communications
to shareholders, including the annual report to shareholders,
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, including the tabulation of shareholder votes;
(e) administer contracts on behalf of the Trust with, among others, 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;
(g) calculate performance data of the Trust for dissemination to
information services covering the investment company industry;
(h) file all of the Trust's tax returns, and prepare and mail annual Form
1099, Form W-2P and Form 5498 to appropriate shareholders, with a copy
to the Internal Revenue Service;
(i) assist with the layout and printing of prospectuses and supplements
thereto, and assist with and coordinate layout and printing of the
Trust's semi-annual and annual reports to shareholders;
(j) provide individuals reasonably acceptable to the Trustees to serve as
officers of the Trust, who will be responsible for the management of
certain of the Trust's affairs as determined by the Trustees;
(k) advise the Trust and its Trustees on matters concerning the Trust and
its affairs including making recommendations regarding dividends and
distributions;
(l) obtain and keep in effect 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;
(m) monitor and advise the Trust and its Portfolios on their registered
investment company status under the Internal Revenue Code of 1986;
(n) monitor and advise the Trust and its Portfolios on compliance with
applicable limitations as imposed by the 1940 Act and the rules and
regulations thereunder or set forth in the Trust's or any Portfolio's
then current Prospectus or Statement of Additional Information;
(o) provide coordination of meetings and preparation of materials for the
quarterly and special meetings of the Trustees and meetings of the
Trust's shareholders;
(p) 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;
(q) 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;
(r) 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;
(s) prepare and file with the SEC the semi-annual report for the Trust on
Form N-SAR and all required notices pursuant to Rule 24f-2 under the
1940 Act; and
(t) furnish advice and recommendations with respect to other aspects of
the business and affairs of the Trust as the Trust, and CQFS shall
determine desirable.
Transfer Agency Services to be Provided By
CITCO-Quaker Fund Services, Inc.
for the Portfolios of The Penn Street Fund, Inc.
------------------------------------------------
(a) SHAREHOLDER TRANSACTIONS
(i) Process shareholder purchase and redemption 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.
(iii) Issue confirmations 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.
(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 detailed history of transactions through duplicate or
special order statements upon request.
(iii) Provide mailing labels for distribution of financial reports,
prospectuses, proxy statements or marketing material to current
shareholders.
(iv) Respond as appropriate 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.
(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 may retain third parties to perform such other
services. Such services may include performing internal audit examination;
mailing the annual reports of the Portfolios; preparing an annual list of
shareholders; and mailing notices of shareholders' meetings, proxies and proxy
statements, for all of which the Trust will pay CQFS's out-of-pocket expenses.
SCHEDULE C
TO THE
MUTUAL FUND SERVICES AGREEMENT
BETWEEN
THE PENN STREET FUND, INC.
AND
CITCO-QUAKER FUND SERVICES, INC.
Dated September 1, 2001
-----------------------
FEE SCHEDULE FOR SERVICES
CITCO-Quaker Fund Services, Inc. will provide all of the services described in
Schedule B herein for the following fees, which will be charged against
aggregate Trust Assets and apportioned among the Portfolios on a pro rata basis:
--------------------------------------------------------------------------------
Average Daily Net Assets Annualized Fees
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On The First $100 Million in Assets 0.40%
--------------------------------------------------------------------------------
On Assets Above $100 Million but
less than $200 Million 0.30%
--------------------------------------------------------------------------------
On Assets Above $200 Million but
less than $300 Million 0.25%
--------------------------------------------------------------------------------
On Assets Above $300 Million but
less than $500 Million 0.20%
--------------------------------------------------------------------------------
On All Assets In Excess of $500 Million 0.15%
--------------------------------------------------------------------------------
The above fees include 100 portfolio trades per month, per Portfolio (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.
The fees set forth above are subject to a minimum annual fee of $50,000 until
such time as fees generated from asset growth exceed he minimum, at which point
the above-described fee schedule will prevail. CQFS agrees to waive the minimum
annual fee for the first year of the Agreement.
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, , , printing, telephone lines, , bank service charges,
Portfolio specific Fund/SERV and Networking costs, other industry standard
transfer agency expenses, travel expenses and any other expenses approved by the
Portfolio(s) or the Trust. 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.
