As filed with the Securities and Exchange Commission on April 30, 1998
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES
ACT OF 1933 |X||X|
Pre-Effective Amendment No. _____ |_||_|
Post-Effective Amendment No. __1__ |X||X|
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT
COMPANY ACT OF 1940 |X||X|
Amendment No. 2
Fleming Capital Mutual Fund Group, Inc.
(Formerly Fleming Capital Mutual Fund Group)
Exact Name of Registrant as Specified in Charter)
c/o 320 Park Avenue
New York, New York 10022
(Address of Principal Executive Offices, Zip Code)
Steven J. Paggioli
Investment Company Administration Corporation
479 West 22nd Street
New York, New York 10011
(Name and Address of Agent for Service)
Copies to:
RICHARD F. JACKSON, ESQUIRE
Morgan, Lewis & Bockius LLP
1800 M STREET, NW
WASHINGTON, DC 20036
Approximate Date of Proposed Public Offering:
As soon as practicable after the effectiveness of the Registration Statement
It is proposed that this filing will become effective:
|X||X| immediately upon filing pursuant to paragraph (b)
|_||_| on (date) pursuant to paragraph (b)
|_||_| 60 days after filing pursuant to paragraph (a)(1)
|_||_| on (date) pursuant to paragraph (a)(1)
|_||_| 75 days after filing pursuant to paragraph (a)(2)
|_||_| on (date) pursuant to paragraph (a)(2) of rule 485
If appropriate check this box:
|_||_| this post-effective amendment designates a new effective date for a
previously filed post-effective amendment
<PAGE>
FLEMING CAPITAL MUTUAL FUND GROUP, INC.
CROSS REFERENCE SHEET
POST-EFFECTIVE AMENDMENT NO. 1
<TABLE>
<CAPTION>
N-1A ITEM NO.LOCATION
- --------- -----------
<S> <C>
PART A -
Item 1. Cover Page Cover Page
Item 2. Synopsis Summary; Expense Summary
Item 3. Condensed Financial Information *
Item 4. General Description of Registrant The Corporation and the Funds; Investment
Objectives; Investment Policies; Risk
Factors; Investment Limitations; General
Information - The Corporation; Description
of Permitted Investments &Risk Factors
Item 5. Management of the Fund The Adviser; The Administrator; The
Transfer Agent; The Distributor; Portfolio
Transactions; Expense Summary; General
Information - Directors of the Corporation
Item 5A. Management's Discussion of Fund *
Performance
Item 6. Capital Stock and Other Securities General Information - Voting Rights;
General Information - Shareholder Inquiries;
General Information - Dividends and
Distributions; Taxes; General Information -
Beneficial Owners
Item 7. Purchase of Securities Being Offered Purchase and Redemption of Shares
Item 8. Redemption or Repurchase Purchase and Redemption of Shares
Item 9. Pending Legal Proceedings *
PART B -
Item 10. Cover Page Cover Page
Item 11. Table of Contents Table of Contents
Item 12. General Information and History *
</TABLE>
<PAGE>
<TABLE>
<S> <C>
Item 13. Investment Objectives and Policies Investment Objectives (Prospectus);
Investment Policies (Prospectus);
Investment Limitations; Description of
Permitted Investments
Item 14. Management of the Fund General Information - Directors of the
Corporation (Prospectus); Directors and
Officers of the Corporation
Item 15. Control Persons and Principal Holders of Directors and Officers of the Corporation
Securities
Item 16. Investment Advisory and Other Services The Adviser (Prospectus and Statement of
Additional Information); The Administrator
(Prospectus and Statement of Additional
Information); The Distributor (Prospectus
and Statement of Additional Information);
The Transfer Agent (Prospectus); General
Information - Counsel and Independent
Auditors (Prospectus); General Information
Custodian (Prospectus)
Item 17. Brokerage Allocation Portfolio Transactions (Prospectus);
Portfolio Transactions
Item 18. Capital Stock and Other Securities Description of Shares
Item 19. Purchase, Redemption, and Pricing of Purchase and Redemption of Shares
Securities Being Offered (Prospectus);Purchase and Redemption of
Shares; Determination of Net Asset Value
Item 20. Tax Status Taxes (Prospectus); Taxes
Item 21. Underwriters The Distributor
Item 22. Calculation of Performance Data Computation of Yield and Total Return
Item 23. Financial Statements Financial Information
PART C -
Information required to be included in Part C is set forth under the appropriate item, so
numbered, in Part C of this Registration Statement.
* Not Applicable
</TABLE>
<PAGE>
As filed with the Securities and Exchange
Commission on April 30, 1998
Registration No. 333-25803
File No. 811-08189
================================================================================
Part A
of
Form N-1A
REGISTRATION STATEMENT
FLEMING CAPITAL MUTUAL FUND GROUP, INC.
================================================================================
<PAGE>
Fleming Capital Mutual Fund Group, Inc.
Supplement to the Prospectus dated September 30, 1997
FINANCIAL HIGHLIGHTS
The following table is be inserted on page 6 of the prospectus.
The financial information of a share of the Fleming Fund and the Fledgling Fund
(the "Funds") outstanding during the period from November 13, 1997 and November
14, 1997 (commencement of operations) to March 31, 1998 included in this table
has been derived from the financial record of the Funds without examination by
the Fund's independent accountants, who do not express an opinion thereon.
FLEMING CAPITAL MUTUAL FUND GROUP, INC.
FINANCIAL HIGHLIGHTS
Unaudited
Fleming Fund Fleming Fledgling Fund
November 13, 1997* November 14, 1997*
to March 31, 1998 to March 31, 1998
Net Asset Value, Beginning of Period $10.00 $10.00
-------- --------
Income from Investment Operations
Net Investment Income 0.08 0.03
Net Realized and Unrealized gains
on Investments 1.85 1.59
-------- --------
Total from Investment Operations 1.93 1.62
-------- --------
Less Distributions:
Dividends from net investment income# (0.03) (0.02)
-------- --------
Net Asset Value, End of Period $11.90 $11.60
======== ========
Total Return+ 19.34% 16.18%
Net Assets at End of Period ('000) $2,355 $1,355
Ratio of Expenses to Average Net Assets
Before Expense Reimbursement++ 9.83% 13.80%
After Expense Reimbursement++ 1.25% 1.35%
Ratio of Net Investment Income to Average++
Net Assets (Net of Expense Reimbursement) 1.47% 0.29%
Portfolio Turnover Rate+ 32.01% 35.20%
Average Commission Rate Paid $0.0685 $0.0566
* Commencement of operations
# Net investment income per share has been computed before adjustments for
book/tax differences + Not annualized ++ Annualized
RISK FACTORS
The following paragraph is to be inserted on page 7 of the Prospectus.
Year 2000. Like other mutual funds and financial and business organizations
around the world, the Fund could be adversely affected if the computer systems
used by it, the Advisor and other service providers and entities with computer
systems that are linked to Fund records do not properly process and calculate
date-related information and data from and after January 1, 2000. This is
commonly known as the "Year 2000 issue." The Fund and Advisor are taking steps
that are reasonably designed to address the Year 2000 issue with respect to the
computer systems they use and to obtain satisfactory assurances that comparable
steps are being taken by each of the Fund's service providers. There can be no
assurance, however, that these steps will be sufficient to avoid any adverse
impact on the Fund
The date of this Supplement is April 30, 1998
The Prospectus for the Fleming Capital Mutual Fund Group, Inc. dated September
30, 1997 is incorporated herein by reference to the Prospectus filed pursuant to
Rule 497 under the Securities Act of 1933, as amended, with the Securities and
Exchange Commission on October 6, 1997.
<PAGE>
As filed with the Securities and Exchange
Commission on April 30, 1998
Registration No. 333-25803
File No. 811-08189
================================================================================
Part B
of
Form N-1A
REGISTRATION STATEMENT
FLEMING CAPITAL MUTUAL FUND GROUP, INC.
================================================================================
<PAGE>
Part B
The Statement of Additional Information for the Fleming Capital Mutual Fund
Group, Inc. dated September 30, 1997 is incorporated herein by reference to the
Prospectus filed pursuant to Rule 497 under the Securities Act of 1933, as
amended, with the Securities and Exchange Commission on October 6, 1997
(accession number 0000950147-97-000683).
<PAGE>
As filed with the Securities and Exchange
Commission on April 30, 1998
Registration No. 333-25803
File No. 811-08189
================================================================================
Part C
of
Form N-1A
REGISTRATION STATEMENT
FLEMING CAPITAL MUTUAL FUND GROUP, INC.
================================================================================
<PAGE>
PART C: OTHER INFORMATION
Item 24. Financial Statements and Exhibits:
----------------------------------
(a) Financial Statements
Part A - Included in this Registration Statement: Financial
Highlights for the period from November 13, 1997 (commencement
of operations) to March 31, 1998, is included in the
Prospectus Supplement of this Post-Effective Amendment.
Part B - Unaudited financial statements for the period from
November 13, 1997 (commencement of operations) to March 31,
1998 for the Fleming Fund and Fleming Fledgling Fund are filed
herewith.
(b) Additional Exhibits
1 (a) Agreement and Declaration of Trust of Fleming
Capital Mutual Fund Group, dated April 21, 1997
(filed as Exhibit 1 to the Registrant's Registration
Statement on April 24, 1997).
(b) Articles of Incorporation of the Registrant,
dated August 15, 1997, (filed with the Fund's
Pre-Effective Amendment No. 1 to its Registration
Statement on Form N-1A dated September 30, 1998.).
(c) Articles of Merger between the Registrant and
Fleming Capital Mutual Fund Group, dated August 21,
1997, (filed with the Fund's Pre-Effective Amendment
No. 1 to its Registration Statement on Form N-1A
dated September 30, 1998.).
2 (a) By-Laws of Fleming Capital Mutual Fund Group
(filed as Exhibit 2 to the Registrant's Registration
Statement on April 24, 1997).
(b) By-Laws of the Registrant, (filed with the Fund's
Pre-Effective Amendment No. 1 to its Registration
Statement on Form N-1A dated September 30, 1998.).
5 Investment Advisory Agreement between the Registrant
and Robert Fleming, Inc., filed herewith.
6 Distribution Agreement between the Registrant and
First Fund Distributors, Inc., filed herewith.
7 Custodian Agreement between the Registrant and Star
Bank, N.A., filed herewith.
<PAGE>
9. (a) Administration Agreement between the Registrant
and Investment Company Administration
Corporation, filed herewith.
(b) Transfer Agent Agreement between the Registrant
and Countrywide Fund Services, Inc., filed
herewith.
(c) Accounting Services Agreement between the
Registrant and Countrywide Fund Services, Inc.,
filed herewith.
10 Opinion and Consent of Counsel, (filed with the
Fund's Pre-Effective Amendment No. 1 to its
Registration Statement on Form N-1A dated September
30, 1998.).
11 Opinion and Consent of Independent Auditors, (filed
with the Fund's Pre-Effective Amendment No. 1 to its
Registration Statement on Form N-1A dated September
30, 1998.)
16 Performance Calculations. filed herewith.
24 Powers of Attorney, filed herewith.
27 Financial Data Schedules, filed herewith.
Item 25. Persons Controlled by or under Common Control with Registrant:
--------------------------------------------------------------
Not applicable.
Item 26. Number of Holders of Securities:
--------------------------------
The number of record holders for each series as of April 21, 1998:
Name of Series Number of Record Holders
-------------- ------------------------
Fleming Fund 16
Fleming Fledgling Fund 9
Item 27. Indemnification:
----------------
Article VIII of the Articles of Incorporation, filed as Exhibit 1(b) to
the Registration Statement, is incorporated by reference. Insofar as
indemnification for liability arising under the Securities Act of 1933
may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the Articles of Incorporation or otherwise, the
Registrant is aware that in the opinion of the Securities and Exchange
Commission, such indemnification is against public policy as expressed
in the Act and, therefore, is unenforceable. In the event that a claim
for indemnification
<PAGE>
against such liabilities (other than the payment by the Registrant of
expenses incurred or paid by directors, officers or controlling
persons of the Registrant in connection with the successful defense of
any act, suit or proceeding) is asserted by such directors, officers
or controlling persons in connection with the shares being registered,
the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by
it is against public policy as expressed in the Securities Act of 1933
and will be governed by the final adjudication of such issues.
Item 28. Business and Other Connections of Investment Adviser:
-----------------------------------------------------
ADVISER
Robert Fleming, Inc. (the "Adviser") is the investment adviser for the
corporation. The principal address of the Adviser is 320 Park Avenue,
New York, New York 10022. The Adviser is an investment adviser
registered under the Advisers Act.
The list required by this Item 28 of officers and directors of the
Adviser, together with information as to any other business
profession, vocation or employment of substantial nature engaged in by
such officers and directors during the past two years is incorporated
by reference to Schedules A and D of Form ADV filed by the Adviser to
the Advisers Act (SEC File No. 801- 26297).
Item 29. Principal Underwriters:
-----------------------
(a) Furnish the name of each investment company (other than the
Registrant) for which each principal underwriter currently
distributing the securities of the Registrant also acts as a principal
underwriter, distributor or investment adviser.
Registrant's underwriter, First Fund Distributors, Inc. (the
"Distributor"), acts as distributor for:
Advisors Series Trust
- American Trust Allegiance Fund
- InformationTech 100(R) Fund
- Kaminski Poland Fund
- Rockhaven Funds (The)
Fleming Capital Mutual Fund Group, Inc.
Fremont Mutual Funds, Inc.
Jurika & Voyles Fund Group
RNC Mutual Fund Group, Inc.
PIC Investment Trust
<PAGE>
Professionally Managed Portfolios
- Avondale Total Return Fund
- Perkins Opportunity Fund
- Osterweis Fund
- Pacific Gemini Partners Fund Group
- ProConscience Women's Equity Mutual Fund
- Academy Value Fund
- Kayne, Anderson Rising Dividends Fund
- Trent Equity Fund
- Leonetti Balanced Fund
- Lighthouse Growth Fund
- U.S. Global Leaders Growth Fund
- Boston Managed Growth Fund
- Harris Bretall Sullivan & Smith Growth Fund
- Insightful Investor Growth Fund
- Hodges Fund
- Penza Growth Fund
- Titan Investment Fund
Purisima Total Return Fund
Rainier Investment Management
(b) Furnish the Information required by the following table with
respect to each director, officer or partner of each principal
underwriter named in the answer to Item 21 of Part B.
Name Principal Business Positions and Offices with Positions and
Offices with Address Principal Underwriter Registrant
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------
<S> <C> <C>
Robert W. Wadsworth President and 4455 E. Camelback Road Suite 261E
Treasurer Phoenix, AZ 85018
-----------------------------------------------------------------------------------
Steven J. Paggioli Vice President and 479 West 22nd Street
Secretary New York, NY 10011
-----------------------------------------------------------------------------------
Eric M. Banhazl Vice President 2025 E. Financial Way
Glendora, CA 91741
-----------------------------------------------------------------------------------
</TABLE>
Item 30. Location of Accounts and Records:
---------------------------------
Books or other documents required to be maintained by Section 31(a) of
the Investment Company Act of 1940, and the rules promulgated
thereunder, are maintained as follows:
(a) With respect to Rules 31a-1(a); 31a-1(b)(1); (2)(i) and (ii); (3);
(6); (8); (12); and 31a-1(d), the required books and records will be
maintained at the offices of Registrant's Custodian:
Star Bank, N.A.
425 Walnut Street
Cincinnati, OH 45202
<PAGE>
(b) With respect to Rules 31a-1(a); 31a-1(b); (2)(iii) and (4), the
required books and records are maintained at the offices of
Registrant's Administrator:
Investment Company Administration Corporation
2025 E. Financial Way
Suite 101
Glendora, CA 11741
(c) With respect to Rules 31a-1(b)(5), (6), (7), (9), (10) and (11)
and 31a-1(f), the required books and records are maintained at the
principal offices of the Registrant's Adviser:
Robert Fleming, Incorporated
320 Park Avenue
New York, NY 10022
(d) With respect to Rules 31a-1(b)(iv) and (8), the required books and
records are maintained at the offices of Registrant's Transfer Agent
and Accounting Services Agent:
Countrywide Fund Services, Inc.
312 Walnut Street
21st Floor
Cincinnati, Ohio 45202
(e) With respect to Rule 31a-1(d), certain required books and records
will be maintained at the offices of the Registrant's Principal
Underwriter:
First Fund Distributors, Inc.
4455 E. Camelback Road
Suite 261E
Phoenix, AZ 85018
Item 31. Management Services: None.
--------------------------
Item 32. Undertakings:
-------------
Registrant hereby undertakes that whenever shareholders meeting the
requirements of Section 16(c) of the Investment Company Act of 1940
inform the Board of Directors of their desire to communicate with
Shareholders of the Corporation, the Directors will inform such
Shareholders as to the approximate number of Shareholders of record
and the approximate costs of mailing or afford said Shareholders
access to a list of Shareholders. Registrant hereby undertakes to call
a meeting of Shareholders for the purpose of voting upon the question
of removal of a Director(s) when requested in writing to do so by the
holders of at least 10% of Registrant's outstanding shares and in
connection with such meetings to comply with the provisions of Section
16(c) of the Investment Company Act of 1940.
<PAGE>
Registrant hereby undertakes to file a post-effective amendment,
including financial statements which need not be certified, within 4-6
months from the effective date of the Registrant's 1933 Act
Registration Statement - Filed herewith.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the Investment
Company Act of 1940, the Registrant certifies that it meets all of the
requirements for effectiveness of this Registration Statement pursuant to Rule
485(b) under the Securities Act of 1933 and has duly caused this Registration
Statement (File No. 333-25803) to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of New York, State of New York on this
29th day of April, 1998.
Fleming Capital Mutual Fund Group, Inc.
By:/s/ Jonathan K.L. Simon
------------------------------------
Jonathan K.L. Simon
President
Attest:
/s/ Arthur A. Levy
- ------------------------------------
Arthur A. Levy, Treasurer
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Post-Effective Amendment No.1 to the Registration Statement has been signed
below by the following persons in the capacity on the dates indicated.
Signature Title Date
- --------- ----- ----
/s/ Jonathan K.L. Simon President and April 29, 1998
- --------------------------------- Chairman of the Board
Jonathan K.L. Simon
/s/ Christopher M.V. Jones Vice President and April 29, 1998
- --------------------------------- Director
Christopher M.V. Jones
/s/ Robert E. Marks* Director April 29, 1998
- ---------------------------------
Robert E. Marks
/s/ Michael A. Petrino* Director April 29, 1998
- ----------------------------------
Michael A. Petrino
/s/ Dominic S. Solly* Director April 29, 1998
- ----------------------------------
Dominic S. Solly
/s/ Arthur A. Levy Treasurer April 29, 1998
- ---------------------------------- (Chief Financial
Arthur A. Levy Officer)
* /s/ Larry A. Kimmel
---------------------------------
Larry A. Kimmel, Under Powers of
Attorney Filed Herewith
<PAGE>
EXHIBIT INDEX
Name Exhibit Page
- ---- ------------
Unaudited Financial Statements for the period from
November 13, 1997 (commencement of operations) to
March 31, 1998. Ex - 99.A(B)
Investment Advisory Agreement between Ex-99.B5
the Registrant and Robert Fleming, Inc., filed herewith
Distribution Agreement between the Registrant and Ex-99.B6
First Fund Distributors, Inc., filed herewith.
Custodian Agreement between the Registrant and Ex-99.B8
Star Bank, N.A., filed herewith.
Administration Agreement between the Registrant and Ex-99.B9(a)
Investment Company Administration Corporation, filed herewith.
Transfer Agent Agreement between the Registrant and Ex-99.B9(b)
Countrywide Fund Services, Inc., filed herewith.
Accounting Services Agreement between the Registrant and Ex-99.B9(c)
Countrywide Fund Services, Inc., filed herewith.
Performance Calculations, filed herewith. EX-16
Powers of Attorney, filed herewith. EX-24
Financial Data Schedules, filed herewith
Fleming Fund EX-27.1
Fleming Fledgling Fund EX-27.2
<PAGE>
As filed with the Securities and Exchange
Commission on April 30, 1998
Registration No. 333-25803
File No. 811-08189
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
EXHIBITS TO
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
POST-EFFECTIVE AMENDMENT NO. 1 X
-
and
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940
AMENDMENT NO. 2 X
-
FLEMING CAPITAL MUTUAL FUND GROUP, INC.
(Formerly Fleming Capital Mutual Fund Group)
(Exact name of registrant as specified in charter)
c/o 320 Park Avenue
New York, New York 10011
(Address of principal executive offices)
Exhibits 99.B, 99.B5, 99.B6, 99.B8, 99.B9(a),
99.B9(b), 99.B9(c), 99.B16, 99.B17,
99.B27(1), and 99.B27(2)
FLEMING FUND
Schedule of Investments
March 31, 1998
Unaudited
% of Market
Shares Net Assets Value
- -------------- -------------- ------------
COMMON STOCKS 81.0%
Banks 2.5%
1,000 PNC Bank Corp. $59,938
-----------
59,938
-----------
Diversified Financial 1.9%
1,000 SLM Holding Corp. 43,625
-----------
43,625
-----------
Electronics 4.9%
1,500 Fisher Scientific International 116,250
-----------
116,250
-----------
Food 6.2%
1,000 Nabisco Holdings - Class A 46,875
2,500 Ral Corp Holdings, Inc. 51,875
1,500 Richfood Holdings, Inc. 48,000
-----------
146,750
-----------
Forest Products & Paper 1.8%
1,200 Schweitzer-Mauduit International 41,400
-----------
41,400
-----------
Home Builders 1.9%
1,200 Palm Harbor Homes, Inc. 44,250
-----------
44,250
-----------
Insurance 7.2%
300 General Re Corp. 66,188
2,300 Medical Assurance, Inc. 66,556
700 NAC Re Corp. 36,706
-----------
169,450
-----------
Investment Management 1.1%
1000 Waddell & Reed Financial 26,000
-----------
26,000
-----------
Lodging 3.3%
1,000 Marriott International 35,938
1,000 Marriott International 35,813
250 Sodexho Marriott International 6,641
-----------
78,392
-----------
Machinery - Diversified 1.5%
1,000 Idex Corp. 36,375
-----------
36,375
-----------
See Accompanying Notes To Financial Statements.
<PAGE>
FLEMING FUND
Schedule of Investments
March 31, 1998
Unaudited
% of Market
Shares Net Assets Value
- -------------- -------------- ------------
Media 7.8%
1,500 E.W. Scripps Co. 82,969
100 Washington Post Co. - Class B 53,181
600 Pulitzer Publishing Co. 47,925
-----------
184,075
-----------
Medical 4.3%
3,000 National Healthcare Corp. 101,250
-----------
101,250
-----------
Oils & Gas Producers 3.9%
1,200 Devon Energy Corp. 46,650
1,400 Pogo Producing Co. 44,450
-----------
91,100
-----------
Pipelines 1.8%
800 Mapco, Inc. 41,700
-----------
41,700
-----------
Real Estate 2.4%
1,600 Security Capital Group - Class B 49,200
2,000 Security Capital Group - Class B - Wts 98 6,625
-----------
55,825
-----------
REITS 7.8%
2,500 The Price REIT Inc. 112,030
2,000 Kimco Realty Corp. 70,750
-----------
182,780
-----------
Retail 16.6%
1,200 Dayton-Hudson Corp. 105,600
5,000 Hancock Fabrics 77,812
3,166 Midas, Inc. 65,299
2,300 Shopko Stores, Inc. 72,880
3,000 Viking Office Products, Inc. 69,750
-----------
391,341
-----------
Resort 2.2%
900 Premier Parks, Inc. 52,200
-----------
52,200
-----------
Tools 1.9%
1,000 Snap-On, Inc. 45,625
-----------
45,625
-----------
TOTAL COMMON STOCKS 81.0%
(cost $1,658,433) 1,908,326
-----------
SHORT-TERM INVESTMENTS 17.5%
See Accompanying Notes To Financial Statements.
<PAGE>
FLEMING FUND
Schedule of Investments
March 31, 1998
Unaudited
% of Market
Shares Net Assets Value
- -------------- -------------- ------------
Star Bank Repurchase Agreement, 5.00%,
dated 3/31/98, due 4/1/98,
collateralized by $415,000 GNMA II,
7.00%, due July 20, 2018 412,000
-----------
Total Investments (cost $ 2,070,433) 98.5% 2,320,326
-----------
Other Assets,
Less Liabilities 1.5% 34,438
-----------
NET ASSETS 100.0% $2,354,764
===========
See Accompanying Notes To Financial Statements.
<PAGE>
FLEMING FLEDGLING FUND
Schedule of Investments
March 31, 1998
Unaudited
% of Market
Shares Net Assets Value
- -------------- ---------- ------------
COMMON STOCKS 82.4%
Advertising 2.9%
970 Advo, Inc. $26,796
250 TMP Worldwide, Inc. 12,750
------------
39,546
------------
Apparel 0.7%
250 Unifi, Inc. 9,312
------------
9,312
------------
Banks 1.7%
410 Investors Financial Services 22,550
------------
22,550
------------
Chemicals 2.5%
960 Scotts Co. 33,240
------------
33,240
------------
Commercial Service 15.4%
2,550 Ace Cash Express, Inc. 37,133
100 Acnielson Corp. 10,575
940 Coinmack Laundry Corp. 23,238
1,430 Data Broadcasting Corp. 18,170
460 Envoy Corp. 19,780
350 Interim Services, Inc. 11,812
540 Iron Mountain, Inc. 20,250
980 Pierce Leahy Corp. 11,644
690 Pittston Brinks 26,305
800 Rental Service Corp. 18,600
700 Specialty Care Network 11,334
------------
208,841
------------
Consulting Services 0.9%
340 Superior Consulting Holdings 12,197
------------
12,197
------------
Distribution/Wholesale 6.1%
660 Daisytek International Corp. 32,175
860 Keystone Automotive Industries, Inc. 20,532
810 Scansource, Inc. 17,010
340 Tech Data Corp. 13,090
------------
82,807
------------
Electrical Components & Equipment 1.5%
470 Vicor Corp. 20,295
------------
20,295
------------
Electronics 6.7%
550 BMC Industries, Inc. - Minn. 4,858
600 Cyberoptics Corp. 16,200
750 D I I Group, Inc. 16,125
980 Kemet Corp. 18,190
220 Pittway Corp. - Class A 15,620
585 Solectron Corp. 20,490
------------
91,483
------------
Entertainment 0.9%
440 Panavision, Inc. 11,578
------------
11,578
------------
<PAGE>
FLEMING FLEDGLING FUND
Schedule of Investments
March 31, 1998
Unaudited
% of Market
Shares Net Assets Value
- -------------- ---------- ------------
Hand/Machine Tools 1.4%
500 Applied Power, Inc. - Class A 19,250
------------
19,250
------------
Health Care 4.9%
1,150 Hanger Orthopedic Group 19,333
500 National Healthcare Corp. 16,875
810 Physician Sales & Service 19,035
1,230 Staar Surgical Co. 11,430
------------
66,673
------------
Insurance 2.1%
870 Allied Group, Inc. 28,058
------------
28,058
------------
Leisure Time 1.4%
850 American Classic Voyages 19,550
------------
19,550
------------
Media 4.1%
1,290 Jones Intercable, Inc. - A 23,542
740 United Video Satellite 31,450
------------
54,992
------------
Miscellaneous Manufacturing 0.7%
340 Roper Industries, Inc. 10,094
------------
10,094
------------
Oils & Gas Producers 5.3%
1,415 Newfield Exploration Co. 36,878
1,650 Vintage Petroleum, Inc. 34,650
------------
71,528
------------
Retail 3.8%
800 Regis Corp. 24,000
348 Sonic Corp. 11,685
660 Viking Office Products 15,345
------------
51,030
------------
REITS 2.7%
480 Kimco Realty Corp. 16,980
790 SL Green Realty Corp. 20,194
------------
37,174
------------
Rental Equipment 1.8%
640 Cole National Corp. 24,720
------------
24,720
------------
Semiconductors 1.3%
460 Xilinx Inc. 17,221
------------
17,221
------------
Software 7.6%
850 Acxiom Corp. 21,780
510 Advent Software, Inc. 24,225
410 CSG Systems Int'l, Inc. 18,552
1,250 Integrated Systems, Inc. 26,952
See Accompanying Notes To Financial Statements.
<PAGE>
FLEMING FLEDGLING FUND
Schedule of Investments
March 31, 1998
Unaudited
% of Market
Shares Net Assets Value
- -------------- ---------- ------------
600 Pegasystems, Inc. 10,950
------------
102,459
------------
Transportation 6.1%
720 Air Express International 19,111
1,160 American Freightways Corp. 12,760
630 Heartland Express, Inc. 17,482
1,000 Landair Services, Inc. 33,000
------------
82,353
------------
TOTAL COMMON STOCKS 82.4%
(cost $974,290) 1,116,951
------------
SHORT-TERM INVESTMENTS 15.6%
Star Bank Repurchase Agreement, 5.00%,
dated 3/31/98, due 4/1/98, collateralized
by $412,000 GNMA II, 7.00%, due July
20, 2018 211,000
------------
Total Investments (cost $ 1,185,290) 98.0% 1,327,951
------------
Other Assets,
less Liabilities 2.0% 27,427
------------
NET ASSETS 100.0% $1,355,378
============
See Accompanying Notes To Financial Statements.
<PAGE>
FLEMING CAPITAL MUTUAL FUND GROUP, INC.
STATEMENTS OF ASSETS AND LIABILITIES
March 31, 1998
Unaudited
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Fleming Fleming Fledgling
Fund Fund
------------------------------------------
<S> <C> <C>
ASSETS
Investments in securities at market value
(cost of $2,070,433 and $1,185,290, respectively) $2,320,326 $1,327,951
Cash 103,632 726
Receivables:
Dividends and interest 1,745 596
Investment securities sold 64,383 7,998
From Advisor (Note 1) 27,761 26,405
Deferred organization costs, net 47,607 47,657
Other Assets 2,448 1,367
------------------------------------------
Total assets 2,567,902 1,412,700
------------------------------------------
LIABILITIES
Payables:
For investment securities purchased 188,208 33,872
Other accrued expenses 24,930 23,450
------------------------------------------
Total liabilities 213,138 57,322
------------------------------------------
NET ASSETS $2,354,764 $1,355,378
==========================================
COMPOSITION OF NET ASSETS
Paid-in capital $2,044,825 $1,175,455
Undistributed
net investment income 8,951 1,201
Undistributed net realized gain
on investments 51,094 36,061
Net unrealized appreciation on investments 249,894 142,661
------------------------------------------
Net assets $2,354,764 $1,355,378
==========================================
Number of shares issued and outstanding
(100,000,000 shares authorized, $.001 par value) 197,884 116,800
==========================================
Net asset value per share $ 11.90 $ 11.60
==========================================
</TABLE>
See Accompanying Notes To Financial Statements.
<PAGE>
FLEMING CAPITAL MUTUAL FUND GROUP, INC.
STATEMENTS OF OPERATIONS
Unaudited
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Fleming Fleming Fledgling
Fund Fund
------------------------------------------
November 13, 1997* November 14, 1997*
to March 31, 1998 to March 31, 1998
<S> <C> <C>
INVESTMENT INCOME:
Income:
Interest income $ 8,657 $ 5,350
Dividend income 7,808 1,338
------------------------------------------
Total income 16,465 6,688
Expenses:
Administration fees 15,343 15,123
Fund accounting fees 7,671 7,561
Audit fees 6,622 6,527
Transfer agent fees 5,562 5,483
Advisory fees 5,407 4,125
Legal fees 3,836 3,781
Amortization of deferred organization costs 3,416 3,367
Trustees fees 3,164 3,119
Insurance 2,685 2,647
Custodian fees 2,244 2,212
Miscellaneous expenses 1,918 1,891
Reports to shareholders 1,151 1,134
Registration fees 921 909
------------------------------------------
Total expenses 59,940 57,879
Expenses reimbursed/waived (52,426) (52,391)
------------------------------------------
Net expenses 7,514 5,488
------------------------------------------
Net investment income 8,951 1,200
------------------------------------------
NET REALIZED AND UNREALIZED
GAIN ON INVESTMENTS:
Net realized gain on investments 51,094 36,061
Net change in unrealized appreciation on investments 249,894 142,661
------------------------------------------
Net gain on investments 300,988 178,722
------------------------------------------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $ 309,939 $ 179,922
==========================================
*Commencement of Operations
</TABLE>
See Accompanying Notes To Financial Statements.
<PAGE>
FLEMING CAPITAL MUTUAL FUND GROUP, INC.
STATEMENTS OF CHANGES IN NET ASSETS
Unaudited
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Fleming Fleming Fledgling
Fund Fund
-----------------------------------------------
November 13, 1997* November 14, 1997*
to March 31, 1998 to March 31, 1998
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
Operations:
Net investment income $8,951 $1,200
Net realized gain on investments 51,094 36,061
Net change in unrealized appreciation
on investments 249,894 142,661
--------------------------------------------
Net increase in net assets
resulting from operations 309,939 179,922
--------------------------------------------
Distributions to shareholders:
From net investment income (3,632) (1,608)
From net realized gain on investments sold -- --
--------------------------------------------
Total distributions (3,632) (1,608)
--------------------------------------------
Capital share transactions:
Proceeds from shares sold 1,944,825 1,075,456
Net asset value of shares issued on
reinvestment of distributions 3,632 1,608
Cost of shares redeemed -- --
--------------------------------------------
Net increase from capital share transactions 1,948,457 1,077,064
--------------------------------------------
Net increase in net assets 2,254,764 1,255,378
NET ASSETS
Beginning of period 100,000 100,000
--------------------------------------------
End of period $2,354,764 $1,355,378
============================================
CHANGE IN SHARES
Shares sold 187,537 106,642
Shares issued on reinvestment of distributions 347 158
Shares Redeemed 0 0
--------------------------------------------
Net increase 187,884 106,800
============================================
*Commencement of Operations
</TABLE>
See Accompanying Notes To Financial Statements.
<PAGE>
FLEMING CAPITAL MUTUAL FUND GROUP, INC.
FINANCIAL HIGHLIGHTS
Unaudited
<TABLE>
The following information should be read in conjunction with the financial statements
and notes thereto appearing elsewhere in this Semi-Annual Report.
Fleming Fleming Fledgling
Fund Fund
--------------------------------------------------
November 13, 1997* November 14, 1997*
to March 31, 1998 to March 31, 1998
<S> <C> <C>
Net Assets Value, Beginning of Period $10.00 $10.00
--------------------------------------------------
Income from Investment Operations
Net Investment Income 0.08 0.03
Net Realized and Unrealized gains
on Investments 1.85 1.59
--------------------------------------------------
Total from Investment Operations 1.93 1.62
--------------------------------------------------
Less Distributions:
Dividends from net investment income# (0.03) (0.02)
--------------------------------------------------
Net Asset Value, End of Period $11.90 $11.60
==================================================
Total Return+ 19.34% 16.18%
Net Assets at End of Period ('000) $2,355 $1,355
Ratio of Expenses to Average Net Assets
Before Expense Reimbursement++ 9.83% 13.80%
After Expense Reimbursement++ 1.25% 1.35%
Ratio of Net Investment Income to Average++
Net Assets (Net of Expense Reimbursement) 1.47% 0.29%
Portfolio Turnover Rate+ 32.01% 35.20%
Average Commission Rate Paid $0.0685 $0.0566
- --------------------------------------------------------
* Commencement of operations
# Net investment income per share has been computed
before adjustments for book/tax differences
+ Not annualized
++ Annualized
</TABLE>
See Accompanying Notes To Financial Statements.
Exhibit 99.B5
INVESTMENT ADVISORY AGREEMENT
FLEMING CAPITAL MUTUAL FUND GROUP, INC.
AGREEMENT made this 30th day of September, 1997, by and
between Fleming Capital Mutual Fund Group, Inc., a Maryland corporation (the
"Corporation"), and Robert Fleming, Inc. (the "Adviser").
WHEREAS, the Corporation is an open-end management investment
company registered under the Investment Company Act of 1940, as amended (the
"1940 Act"), consisting of several portfolios of shares, each having its own
investment policies; and
WHEREAS, the Corporation desires to retain the Adviser to
render investment management services to the funds of the Corporation listed in
Schedule A to this Agreement and such other funds as the Corporation and the
Adviser, from time to time, may agree upon in writing and add to Schedule A of
this Agreement (the "Funds"), and the Adviser is willing to render such
services:
NOW, THEREFORE, in consideration of the mutual covenants
herein contained, the parties hereto agree as follows:
1. Duties of the Adviser. The Corporation hereby appoints the Adviser
to act as investment adviser to each of the Funds, for the period and on such
terms set forth in this Agreement. The Corporation employs the Adviser to manage
the investment and reinvestment of the assets of the Funds, to continuously
review, supervise and administer the investment program of each of the Funds, to
determine in its discretion the securities to be purchased or sold and the
portion of each such Fund's assets to be held uninvested, to provide the
Corporation with records concerning the Adviser's activities which the
Corporation is required to maintain, and to render regular reports to the
Corporation's officers and Board of Directors (the "Board") concerning the
Adviser's discharge of the foregoing responsibilities.
The Adviser shall discharge the foregoing responsibilities subject to the
control of the officers and the Board, and in compliance with the objectives,
policies and limitations set forth in the Corporation's prospectus(es) and
statement(s) of additional information, as amended or supplemented from time to
time (referred to collectively as the "Prospectus"), and applicable laws and
regulations.
The Adviser accepts such employment and agrees to render the services and to
provide, at its own expense, the office space, furnishings and equipment and the
personnel required by it to perform the services on the terms and for the
compensation provided herein.
2. Fund Transactions. The Adviser is authorized to select the brokers
or dealers that will execute the purchases and sales the portfolio securities
for the Funds and is directed to use its best efforts to obtain the best net
results as described in the Corporation's Prospectus from time to time. The
Adviser agrees to promptly communicate to the officers and Directors of the
Corporation such information relating to portfolio transactions as they may
reasonably request.
It is understood that the Adviser will not be deemed to have acted unlawfully,
or to have breached a fiduciary duty to the Corporation or be in breach of any
obligation owing to the Corporation under this Agreement, or otherwise, by
reason of its having directed a securities transaction on behalf of the
Corporation to (i) a broker-dealer in compliance with the provisions of Section
28(e) of the Securities Exchange Act of 1934 or as described from time to time
in the Prospectus or (ii) an affiliated broker-dealer in compliance with
applicable provisions of the 1940 Act, or the rules and regulations thereunder,
as described from time to time in the Prospectus.
<PAGE>
3. Compensation of the Adviser. For the services to be rendered by the
Adviser as provided in Sections 1 and 2 of this Agreement, the Corporation shall
pay to the Adviser at the end of each month, an advisory fee calculated by
applying a monthly rate, based on the annual percentage rates set forth opposite
each Fund's name on Schedule A hereto, to each Fund's average daily net assets
for the month. The Adviser may, in its discretion and from time to time, waive
all or a portion of its fee.
In the event of termination of this Agreement, the fee provided under this
Section shall be computed on the basis of the period ending on the last business
day on which this Agreement is in effect subject to a pro rata adjustment based
on the number of days elapsed in the current month as a percentage of the total
number of days in such month.
4. Other Services. At the request of the Corporation, the Adviser, in
its discretion, may make available to the Corporation office facilities,
equipment, personnel and other services. Such office facilities, equipment,
personnel and services shall be provided for or rendered by the Adviser and
billed to the Corporation at the Adviser's cost.
5. Reports. The Corporation and the Adviser agree to furnish to each
other current prospectuses, proxy statements, reports to shareholders, certified
copies of their financial statements, and such other information with regard to
their affairs as each may reasonably request.
6. Status of Adviser. The services of the Adviser to the Corporation
are not to be deemed exclusive, and the Adviser shall be free to render similar
services to others so long as its services to the Corporation are not impaired
thereby. The Adviser shall be deemed to be an independent contractor and shall,
unless otherwise expressly provided or authorized, have no authority to act for
or represent the Corporation in any way or otherwise be deemed an agent of the
Corporation.
7. Liability of Adviser. The Adviser shall not be liable for any error
of judgment or of law, as for any loss suffered by the Corporation in connection
with the matters to which this Agreement relates, except a loss resulting from
willful misfeasance, bad faith, or gross negligence on the part of the Adviser
in the performance of its obligations and duties, or by reason of its reckless
disregard of its obligations and duties under this Agreement.
8. Permissible Interests. Subject to and in accordance with the
Articles of Incorporation of the Corporation and the Articles of Incorporation
(or other governing or organizational documents) of the Adviser, Directors,
agents and shareholders of the Corporation are or may be interested in the
Adviser (or any successor thereof) as officers, directors or otherwise;
officers, agents and directors of the Adviser are or may be interested in the
Corporation as Directors, officers, shareholders or otherwise; and the Adviser
(or any successor) is or may be interested in the Corporation as a shareholder
or otherwise. The effect of any such interrelationships shall be governed by
said Articles of Incorporation (or other governing or organizational documents)
and provisions of the 1940 Act. All such interests shall be fully disclosed
between the parties on an ongoing basis and in the Corporation's Prospectus to
the extent required by law. In addition, brokerage transactions for the
Corporation may be effected through the Adviser or affiliates of the Adviser,
acting as agent, if approved by the Board, subject to the rules and regulations
of the Securities and Exchange Commission.
<PAGE>
9. Duration and Termination. This Agreement, unless sooner terminated
as provided herein, shall continue until _________, 1999 and thereafter for
additional periods of one year from the anniversary thereof, but only so long as
such continuance is specifically approved at least annually (a) by the vote of a
majority of those members of the Corporation's Board who are not parties to this
Agreement or interested persons of any such party, cast in person at a meeting
called for the purpose of voting on such approval, and (b) by the Corporation's
Board or by vote of a majority of the outstanding voting securities of each Fund
of the Corporation; provided, however, that if the shareholders of any Fund fail
to approve the Agreement as provided herein, the Adviser may continue to serve
in such capacity with respect to that Fund in the manner and to the extent
permitted by the 1940 Act and rules thereunder. This Agreement may be terminated
by any Fund of the Corporation at any time, on 60 days' written notice to the
Adviser, without the payment of any penalty, by vote of a majority of the entire
Board of the Corporation or by vote of a majority of the outstanding voting
securities of the Fund. This Agreement may be terminated by the Adviser at any
time, without the payment of any penalty, upon 60 days' written notice to the
Corporation. This Agreement will automatically and immediately terminate in the
event of its assignment. Any notice under this Agreement shall be given in
writing, addressed and delivered or mailed postpaid, to the other party at any
office of such party.
As used in this Section 9, the terms "assignment," "interested persons," and "a
vote of a majority of the outstanding voting securities" shall have the
respective meanings set forth in Section 2(a)(4), Section 2(a)(19) and Section
2(a)(42) of the 1940 Act.
10. Amendment of Agreement. This Agreement may be amended by mutual
consent, but the consent of the Corporation must be approved (a) by a vote of a
majority of those members of the Corporation's Board who are not parties to this
Agreement or interested persons of any such party, cast in person at a meeting
called for the purpose of voting on such amendment, and (b) to the extent
required by the 1940 Act, by vote of a majority of the outstanding voting
securities of each Fund of the Corporation.
11. Governing Law. All questions concerning the validity, meaning and
effect of this Agreement shall be determined in accordance with the laws
(without giving effect to the conflict-of-law principles thereof) of the State
of Maryland applicable to contracts made and to be performed in that state.
12. Severability. If any provision of this Agreement shall be held or
made invalid by a court decision, statute, rule or otherwise, the remainder of
this Agreement shall not be affected thereby.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed as of this 30 day of September, 1997.
FLEMING CAPITAL MUTUAL FUND GROUP, INC. ROBERT FLEMING, INC.
By /s/ Jonathan K.L. Simon By /s/ Arthur Levy
-------------------------- ------------------
Name: Jonathan K.L. Simon Name: Arthur Levy
Title: President Title: Vice Chairman
<PAGE>
Schedule A
Fund Rate
- ---- ----
Fleming Fund 0.90%
Fledgling Fund 1.00%
Ex-99.B6
DISTRIBUTION AGREEMENT
This Agreement, made as of the 30th day of September , 1997 between
Fleming Capital Mutual Fund Group Inc., a Maryland corporation (the "Fund"), and
the First Fund Distributors, Inc. (the "Distributor"), a corporation.
WITNESSETH:
WHEREAS, the Fund proposes to engage in business as an open-end
management investment company and is registered as such under the Investment
Company Act of 1940, as amended (the "1940 Act") and its shares are registered
under the Securities Act of 1933, as amended (the "1933 Act"); and
WHEREAS, the Distributor is registered as a broker-dealer under the
Securities Exchange Act of 1934, as amended (the "1934 Act"), and is a member in
good standing of the National Association of Securities Dealers, Inc. (the
"NASD"); and
WHEREAS, the Fund and the Distributor wish to enter into an agreement
with each other with respect to the continuous offering of the Fund's shares of
beneficial interest (the "Shares"), $0.001 par value, to commence on,
NOW, THEREFORE, in consideration of the mutual covenants set forth in
this Agreement, the Fund and the Distributor hereby agree as follows:
1. Appointment of Distributor. The Fund hereby appoints the Distributor
as its exclusive agent to sell and to arrange for the sale of the Fund's shares
of beneficial interest ("Shares") at the net asset value per share plus any
applicable sales charges in accordance with the Fund's current prospectus(es),
on the terms and for the period set forth in this Agreement, and the Distributor
hereby accepts such appointment and agrees to act hereunder directly and/or
through the Fund's transfer agent using all reasonable efforts in connection
with the distribution of Shares of the Fund. It is understood and agreed that
the services of the Distributor hereunder are not exclusive, and the Distributor
may act as principal underwriter for the shares of any other registered
investment company.
2. Services and Duties of the Distributor.
(a) The Distributor agrees to sell the Shares, as agent for
the Fund, from time to time during the term of this Agreement upon the terms
described in the Fund's current Prospectus(es). As used in this Agreement, the
term "Prospectus" shall mean the prospectus and statement of additional
information included as part of the Fund's Registration Statement, as such
prospectus and statement of additional information may be amended or
supplemented from time to time, and the term "Registration Statement" shall mean
the registration statement most recently filed from time to time by the Fund
with the Securities and Exchange Commission and effective under the 1933 Act and
the 1940 Act, as such Registration Statement is amended by any amendments
thereto at the time in effect. The Distributor shall not be obligated to sell
any certain number of Shares.
<PAGE>
(b) The Distributor will hold itself available to receive
orders, that the Distributor reasonably believes to be in good order, for the
purchase of the Shares and will accept such orders and will transmit such orders
as are so accepted and funds received by it in payment for such Shares to the
Fund's transfer agent or custodian, as appropriate, as promptly as practicable.
Purchase orders shall be deemed effective at the time and in the manner set
forth in the Prospectus. The Distributor shall not make any short sales of
Shares.
(c) The offering price of the Shares shall be the net asset
value per share of the Shares plus any applicable sales charges, determined as
set forth in the Prospectus. The Fund shall furnish the Distributor, with all
possible promptness, an advice of each computation of net asset value and
offering price.
3. Duties of the Fund.
(a) Maintenance of Federal Registration. The Fund shall, at
its expense, take, from time to time, all necessary action and such steps,
including payment of the related filing fees, as may be necessary to register
and maintain registration of a sufficient number of Shares under the 1933 Act.
The Fund agrees to file from time to time such amendments, reports and other
documents as may be necessary in order that there may be no untrue statement of
a material fact in a Registration Statement or Prospectus, or necessary in order
that there may be no omission to state a material fact in the Registration
Statement or Prospectus which omission would make the statements therein
misleading.
(b) Maintenance of "Blue Sky" Qualifications. The Fund shall,
at its expense, use its best efforts to qualify and maintain the qualification
of an appropriate number of Shares for sale under the securities laws of such
states as the Distributor and the Fund may approve, and, if necessary or
appropriate in connection therewith, to qualify and maintain the qualification
of the Fund as a broker or dealer in such states; provided that the Fund shall
not be required to amend its Articles of Incorporation or By-Laws to comply with
the laws of any state, to maintain an office in any state, to change the terms
of the offering of the Shares in any state, to change the terms of the offering
of the Shares in any state from the terms set forth in its Registration
Statement and Prospectus, to qualify as a foreign corporation in any state or to
consent to service of process in any state other than with respect to claims
arising out of the offering and sale of the Shares. The Distributor shall
furnish such information and other material relating to its affairs and
activities as may be required by the Fund in connection with such
qualifications.
(c) Copies of Reports and Prospectus. The Funds shall, at its
expense, keep the Distributor fully informed with regard to its affairs that
reasonably relate to the distribution of the Fund's Shares and in connection
therewith shall furnish to the Distributor copies of all information, financial
statements and other papers which the Distributor may reasonably request for use
in connection with the distribution of Shares, including such reasonable number
of copies of its Prospectus and annual and interim reports as the Distributor
may request and shall cooperate fully in the efforts of the Distributor to sell
and arrange for the sale of the Shares and in the performance of the Distributor
under this Agreement.
<PAGE>
4. Conformity with Applicable Law and Rules. The Distributor agrees
that in selling Shares hereunder it shall conform in all respects with the laws
of the United States and of any state in which Shares may be offered, and with
applicable rules and regulations of the NASD.
5. Independent Contractor. In performing its duties hereunder, the
Distributor shall be an independent contractor and neither the Distributor, nor
any of its officers, directors, employees, or representatives is or shall be an
employee of the Fund in the performance of the Distributor's duties hereunder.
The Distributor shall be responsible for its own conduct and the employment,
control, and conduct of its agents and employees and for injury to such agents
or employees or to others through its agents or employees. The Distributor
assumes full responsibility for its agents and employees under applicable
statutes and agrees to pay all employee taxes thereunder.
6. Indemnification.
(a) Indemnification of Fund. The Distributor agrees to
indemnify and hold harmless the Fund and each of its present or former
directors, officers, employees, representatives an each person, if any, who
controls or previously controlled the Fund within the meaning of Section 15 of
the 1933 Act against any and all losses, liabilities, damages, claims or
expenses (including the reasonable costs or investigating or defending any
alleged loss, liability, damage, claims or expense and reasonable legal counsel
fees incurred in connection therewith) to which the Fund or any such person may
become subject under the 1933 Act, under any other statute, at common law, or
otherwise, arising out of the acquisition of any Shares by any person which (i)
may be based upon any wrongful act by the Distributor or any of the
Distributor's directors, officers, employees or representatives, or (ii) may be
based upon any untrue statement or alleged untrue statement of a material fact
contained in a registration statement, prospectus, shareholder report or other
information covering Shares filed or made public by the Fund or any amendment
thereof or supplement thereto, or the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading if such statement or omission was made in
reliance upon information furnished to the Fund by the Distributor, it being
understood that the Fund will rely upon the information provided by the
Distributor for use in the preparation of the Registration Statement and
Prospectus. In no case (i) is the Distributor's indemnity in favor of the Fund,
or any other person indemnified, to be deemed to protect the Fund or such
indemnified person against any liability to which the Fund or such person would
otherwise be subject by reason of willful misfeasance, bad faith, or gross
negligence in the performance of his duties or by reason of his reckless
disregard of his obligations and duties under this Agreement, or (ii) is the
Distributor to be liable under its indemnity agreement contained in this
Paragraph with respect to any claim made against the Fund or any person
indemnified unless the Fund or such person, as the case may be, shall have
notified the Distributor in writing of the claim within a reasonable time after
the summons or other first written notification giving information of the nature
of the claim shall have been served upon the Fund or upon such person (or after
the Fund or such person shall have received notice to such service on any
designated agent). However, failure to notify the Distributor of any such claim
shall not relieve the Distributor from any liability which the Distributor may
have to the Fund or any person against whom such action is brought otherwise
than on account of the Distributor's indemnity agreement contained in this
Paragraph.
<PAGE>
The Distributor shall be entitled to participate, at its own expense,
in the defense, or, if the Distributor so elects, to assume the defense of any
suit brought to enforce any claim as to which it provides this indemnification,
but, if the Distributor elects to assume the defense, such defense shall be
conducted by legal counsel chosen by the Distributor and satisfactory to the
Fund, whose approval shall not be unreasonably withheld, and any other
indemnified defendant or defendants in the suit. In the event that the
Distributor elects to assume the defense of any such suit and retain such legal
counsel, the Fund and any other indemnified defendant or defendants in the suit
shall bear the fees and expenses of any additional legal counsel retained by
them. If the Distributor does not elect to assume the defense of any such suit,
the Distributor will reimburse the Fund and any other indemnified defendant or
defendants in such suit for the reasonable fees and expenses of any legal
counsel retained by them. The Distributor agrees to promptly notify the Fund of
the commencement of any litigation of proceedings against it or any of its
officers, employees, representatives or control persons in connection with the
issue or sale of any Shares.
(b) Indemnification of the Distributor. The Fund agrees to
indemnify and hold harmless the Distributor and each of its present or former
officers, employees, representatives and each person, if any, who controls or
previously controlled the Distributor within the meaning of Section 15 of the
1933 Act against any and all losses, liabilities, damages, claims or expenses
(including the reasonable costs of investigating or defending any alleged loss,
liability, damage, claim or expense and reasonable legal counsel fees incurred
in connection therewith) to which the Distributor or other indemnified person
may become subject under the 1933 Act, under any other statute, at common law,
or otherwise, arising out of the acquisition of any Shares by any person which
(i) may be based upon any wrongful act by the Fund or any of the Fund's
directors, officers, employees or representatives, or (ii) may be based upon any
untrue statement or alleged untrue statement of a material fact contained in a
registration statement, prospectus, shareholder report or other information
covering Shares filed or made public by the Fund or any amendment thereof or
supplement thereto, or the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading unless such statement or omission was made in reliance
upon information furnished to the Fund by the Distributor, it being understood
that the Fund will rely upon the information provided by the Distributor for use
in the preparation of the Registration Statement and Prospectus. In no case (i)
is the Fund's indemnity in favor of the Distributor, or any person indemnified
to be deemed to protect the Distributor or such indemnified person against any
liability to which the Distributor or such person would otherwise be subject by
reason of willful misfeasance, bad faith, or gross negligence in the performance
of his duties or by reason of his reckless disregard of his obligations and
duties under this Agreement, or (ii) is the Fund to be liable under its
indemnity agreement contained in this Paragraph with respect to any claim made
against Distributor, or person indemnified unless the Distributor, or such
indemnified person, as the case may be, shall have notified the Fund in writing
of the claim within a reasonable time after the summons or other first written
notification giving information of the nature of the claim shall have been
served upon the Distributor or upon such person (or after the Distributor or
such person shall have received notice of such service on any designated agent).
However, failure to notify the Fund of any such claim shall not relieve the Fund
from any liability which the Fund may have to the Distributor or any person
against whom such action is brought otherwise than on account of the Fund's
indemnity agreement contained in this Paragraph.
The Fund shall be entitled to participate, at its own expense,
in the defense, or, if the Fund so elects, to assume the defense of any suit
brought to enforce any claim as to which it provides this indemnification, but
if the Fund elects to assume the defense, such defense shall be conducted by
legal counsel chosen by the Fund and satisfactory to the Distributor whose
approval shall not be unreasonably withheld, and any other indemnified defendant
or defendants in the suit. In the event that the Fund elects to assume the
defense of any such suit and retain such legal counsel, the Distributor, and any
other indemnified defendant or defendants in the suit, shall bear the fees and
expenses of any additional legal counsel retained by them. If the Fund does not
elect to assume the defense of any such suit, the Fund will reimburse the
Distributor and any other indemnified defendant or defendants in such suit for
the reasonable fees and expenses of any legal counsel retained by them. The Fund
agrees to promptly notify the Distributor of the commencement of any litigation
or proceedings against it or any of its directors, officers, employees or
representatives in connection with the issue or sale of any Shares.
7. Authorized Representation. The Distributor is not authorized by the
Fund to give on behalf of the Fund any information or to make any
representations in connection with the sale of Shares other than the information
and representations contained in a registration statement filed with the
Securities and Exchange Commission ("SEC") under the 1933 Act and the 1940 Act,
as such registration statement may be amended from time to time, or contained in
shareholder reports or other material that may be prepared by or on behalf of
the Fund for the Distributor's use. The Distributor may prepare and distribute
sales literature and other material as it may deem appropriate, provided that
such literature and materials have been prepared in accordance with applicable
laws, rules and regulations and further provided that the Fund be given notice
of such literature and materials prior to their first distribution. No person
other than the Distributor is authorized to act as principal underwriter (as
such term is defined in the 1940 Act) for the Fund.
8. Term of Agreement. This Agreement shall be effective upon its
execution, and unless terminated as provided, shall continue in force through ,
1999 and thereafter from year to year, provided that such annual continuance is
approved by (i) either the vote of a majority of the Directors of the Fund, or
the vote of a majority of the outstanding voting securities of the Fund, and
(ii) the vote of a majority of those Directors of the Fund who are not parties
to this Agreement or interested persons of any such party ("Qualified
Directors") cast in person at a meeting called for the purpose of voting on the
approval. The Distributor shall furnish to the Fund, promptly upon its request,
such information as may reasonably be necessary to evaluate the terms of this
Agreement or any extension, renewal or amendment hereof.
9. Amendment and Assignment of Agreement. This Agreement may not be
amended without the affirmative vote of a majority of the outstanding voting
securities of the Fund. This Agreement shall automatically and immediately
terminate in the event of its assignment.
10. Termination of Agreement. This Agreement may be terminated by
either party hereto, without the payment of any penalty, on not more than upon
60 days' nor less than 30 days' prior notice in writing to the other party;
provided, that in the case of termination by the Fund such action shall have
been authorized by resolution of a majority of the Qualified Directors of the
Fund, or by vote of a majority of the outstanding voting securities of the Fund.
<PAGE>
11. Miscellaneous. The captions of this Agreement are included for
convenience of reference only and in no way define or delineate any of the
provisions hereof or otherwise affect their construction or effect.
This Agreement may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
Nothing herein contained shall be deemed to require the Fund to take
any action contrary to its Articles of Incorporation or By-Laws, or any
applicable statutory or regulatory requirement to which it is subject or by
which it is bound, or to relieve or deprive the Board of Directors of the Fund
of its responsibility for and control of the conduct of the affairs of the Fund.
12. Compliance with Securities Laws. The Fund represents that it is
registered as an open-end management investment company under the 1940 Act, and
agrees that it will comply with all applicable provisions of the 1940 Act, the
1933 Act and state securities laws and the rules and regulations thereunder. The
Distributor represents that it is a broker-dealer registered under the
Securities Exchange Act of 1934, is a member in good standing of the National
Association of Securities Dealers, Inc., and agrees to comply with all of the
applicable terms and provisions of the Securities Exchange Act of 1934, the 1940
Act, the 1933 Act, and state securities laws and the rules and regulations
thereunder and with applicable rules and regulations of the NASD.
13. Notices. Any notice required to be given pursuant to this Agreement
shall be deemed duly given if delivered or mailed by registered mail, postage
prepaid to the Distributor at 4455 E. Camelback Rd., Suite 261-E, Phoenix, AZ
85018 and to the Fund at 320 Park Avenue, New York, NY 10022.
14. Governing Law. This Agreement shall be governed and construed in
accordance with the laws of the State of New York. Any question of
interpretation of any term or provision of this Agreement having a counterpart
in or otherwise derived from a term or provision of the 1940 Act, however, shall
be resolved by reference to such term or provision of the 1940 Act and to
interpretation thereof, if any, by the United States courts or, in the absence
of any controlling decision of any such court, by rules, regulations or orders
of the Securities and Exchange Commission validly issued pursuant to the 1940
Act. Specifically, the terms "vote of a majority of the outstanding voting
securities", "interested persons", "assignment", and "affiliated person", as
used in this Agreement, shall have the meanings assigned to them by Section 2(a)
of the 1940 Act. Where the effect of a requirement of the 1940 Act reflected in
any provision of this Agreement is relaxed by a rule, regulation or order of the
Securities and Exchange Commission, whether of special or of general
applications, such provision shall be deemed to incorporate the effect of such
rule, regulation or order. To the extent that the applicable laws of the State
of New York, or any of the provisions herein, conflict with the applicable
provisions of the 1940 Act, the latter shall control.
15. Limitation of Liability. A copy of the Articles of Incorporation of
the Fund is on file with the State Department of Assessment and Taxation of the
State of Maryland, and notice is hereby given that this Agreement is executed on
behalf of the Directors of the Fund as Directors and not individually and that
the obligations of this instrument are not binding upon any of the Directors,
officers or Shareholders of the Fund individually but binding only upon the
assets and property of the Fund. Further, obligations of the Fund with respect
to any one Portfolio shall not be binding upon any other Portfolio.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
signed by their fully authorized representatives and their respective corporate
seals to be hereunto affixed, as of the day and year first above written.
Fleming Capital Mutual Fund Group
By /s/ Jonathan K.L. Simon
--------------------------
Attest:
/s/ Sharon A. Devlin
- --------------------
First Fund Distributors, Inc.
By:/s/ Eric M. Banhazl
----------------------
Attest:
/s/ Joy Ausili
- --------------
CUSTODY AGREEMENT
BETWEEN
STAR BANK, N.A.
AND
FLEMING CAPITAL MUTUAL FUND GROUP, INC.
<PAGE>
TABLE OF CONTENTS
Description Page
ARTICLE I - DEFINITIONS........................................................1
ARTICLE II - APPOINTMENT; ACCEPTANCE;
AND FURNISHING OF DOCUMENTS..................................................4
Appointment of Custodian.....................................................4
Acceptance of Custodian......................................................4
Documents to be Furnished....................................................4
Notice of Appointment of Dividend and Transfer Agent.........................5
ARTICLE III - RECEIPT OF ASSETS................................................5
Delivery of Moneys...........................................................5
Delivery of Securities.......................................................5
Payments for Shares..........................................................5
Duties Upon Receipt..........................................................5
Validity of Title............................................................5
ARTICLE IV - DISBURSEMENT OF CORPORATION ASSETS................................6
Declaration of Dividends by Corporation......................................6
Segregation of Redemption Proceeds...........................................6
Disbursements of Custodian...................................................6
Payment of Custodian Fees....................................................7
ARTICLE V - CUSTODY OF CORPORATION ASSETS......................................7
Separate Accounts for Each Fund..............................................7
Segregation of Non-Cash Assets ..............................................7
Securities in Bearer and Registered Form.....................................7
Duties of Custodian As to Securities.........................................8
Certain Actions Upon Written Instructions....................................8
Custodian to Deliver Proxy Materials.........................................9
Custodian to Deliver Tender Offer Information................................9
ARTICLE VI - PURCHASE AND SALE OF SECURITIES..................................10
Purchase of Securities......................................................10
Sale of Securities..........................................................11
Options.....................................................................11
Payment on Settlement Date..................................................12
Credit of Moneys Prior to Receipt...........................................12
Segregated Accounts.........................................................12
Advances for Settlement.....................................................14
ARTICLE VII - CORPORATION INDEBTEDNESS........................................14
ARTICLE VIII - CONCERNING THE CUSTODIAN.......................................15
Limitations of Liability of Custodian.......................................15
Actions Not Required By Custodian...........................................17
No Duty to Collect Amounts Due From Dividend and Transfer Agent.............18
No Enforcement Actions......................................................18
Authority to Use Agents and Sub-Custodians..................................18
No Duty to Supervise Investments............................................19
All Records Confidential....................................................19
Compensation of Custodian...................................................19
Reliance Upon Instructions..................................................19
Books and Records...........................................................20
Internal Accounting Control Systems.........................................20
No Management of Assets By Custodian........................................20
Assistance to Corporation...................................................21
Grant of Security Interest..................................................21
ARTICLE IX - INITIAL TERM; TERMINATION........................................21
Initial Term................................................................21
Termination.................................................................21
Failure to Designate Successor Custodian....................................22
ARTICLE X - FORCE MAJEURE.....................................................22
ARTICLE XI - MISCELLANEOUS....................................................23
Designation of Authorized Persons...........................................23
Limitation of Personal Liability............................................23
Authorization By Board......................................................23
Custodian's Consent to Use of Its Name. ....................................24
Notices to Custodian........................................................24
Notices to Corporation......................................................24
Amendments In Writing.......................................................24
Successors and Assigns......................................................24
Governing Law...............................................................25
Jurisdiction................................................................25
Counterparts................................................................25
Headings....................................................................25
APPENDIX A - Authorized Signatures
APPENDIX B - Series of the Corporation
APPENDIX C - Agents of the Custodian
APPENDIX D - Standards of Service Guide
APPENDIX E - Schedule of Compensation
<PAGE>
CUSTODY AGREEMENT
This agreement (the "Agreement") is entered into as of the ________ day
of ______, 1997, by and between Fleming Capital Mutual Fund Group, Inc. (the
"Corporation") and Star Bank, National Association, (the "Custodian"), a
national banking association having its principal office at 425 Walnut Street,
Cincinnati, Ohio, 45202.
WHEREAS, the Corporation and the Custodian desire to enter into this
Agreement to provide for the custody and safekeeping of the assets of the
Corporation as required by the Act (as hereafter defined).
THEREFORE, in consideration of the mutual promises hereinafter set
forth, the Corporation and the Custodian agree as follows:
ARTICLE I
Definitions
-----------
The following words and phrases, when used in this Agreement, unless
the context otherwise requires, shall have the following meanings:
Act - the Investment Company Act of 1940, as amended.
1934 Act - the Securities and Exchange Act of 1934, as amended.
Authorized Person - any (i) Officer of the Corporation or (ii) any
other person, whether or not any such person is an officer or employee of the
Corporation, who is duly authorized by the Board of Directors of the Corporation
to give Oral Instructions and Written Instructions on behalf of the Corporation
or any Fund, and named in Appendix A attached hereto and as amended from time to
time by resolution of the Board of Directors, certified by an Officer, and
received by the Custodian.
Board of Directors - the Directors from time to time serving under the
Corporation's Articles of Incorporation, as from time to time amended.
Book-Entry System - a federal book-entry system as provided in Subpart
O of Treasury Circular No. 300, 31 CFR 306, in Subpart B of 31 CFT Part 350, in
such book-entry regulations of federal agencies as are substantially in the form
of Subpart O, or in any other book-entry system permitted by the SEC for use by
registered investment companies under Rule 17F-4 under the Act.
Business Day - any day recognized as a settlement day by The New York
Stock Exchange, Inc. and any other day for which the Corporation computes the
net asset value of Shares of any fund.
Depository - The Depository Trust Company ("DTC"), a limited purpose
Trust company, its successor(s) and its nominee(s) or any other clearing agency
registered with the SEC under Section 17A of the 1934 Act which acts as a system
for the central handling of Securities where all Securities of any particular
class or series of an issuer deposited within the system are treated as fungible
and may be transferred or pledged by bookkeeping entry without physical delivery
of the Securities, provided that the Custodian shall have received a copy of a
resolution of the Board of Directors, certified by an Officer, specifically
approving the use of such clearing agency as a depository for the Funds.
Dividend and Transfer Agent - the dividend and transfer agent
appointed, from time to time, pursuant to a written agreement between the
dividend and transfer agent and the Corporation.
<PAGE>
Foreign Securities - a) securities issued and sold primarily outside of
the United States by a foreign government, a national of any foreign country, or
a Corporation or other organization incorporated or organized under the laws of
any foreign country or; b) securities issued or guaranteed by the government of
the United States, by any state, by any political subdivision or agency thereof,
or by any entity organized under the laws of the United States or of any state
thereof, which have been issued and sold primarily outside of the United States.
Fund - each series of the Corporation listed in Appendix B and any
additional series added pursuant to Proper Instructions. A series is
individually referred to as a "Fund" and collectively referred to as the
"Funds."
Money Market Security - debt obligations issued or guaranteed as to
principal and/or interest by the government of the United States or agencies or
instrumentalities thereof, commercial paper, obligations (including certificates
of deposit, bankers' acceptances, repurchase agreements and reverse repurchase
agreements with respect to the same), and time deposits of domestic banks and
thrift institutions whose deposits are insured by the Federal Deposit Insurance
Corporation, and short-term corporate obligations where the purchase and sale of
such securities normally require settlement in federal funds or their equivalent
on the same day as such purchase and sale, all of which mature in not more than
thirteen (13) months.
NASD - the National Association of Securities Dealers, Inc.
Officer - the Chairman, President, Secretary, Treasurer, any Vice
President, Assistant Secretary or Assistant Treasurer of the Corporation.
Oral Instructions - instructions orally transmitted to and received by
the Custodian from an Authorized Person (or from a person that the Custodian
reasonably believes in good faith to be an Authorized Person) and confirmed by
Written Instructions in such a manner that such Written Instructions are
received by the Custodian on the Business Day immediately following receipt of
such Oral Instructions.
Proper Instructions - Oral Instructions or Written Instructions. Proper
Instructions may be continuing Written Instructions when deemed appropriate by
both parties.
Prospectus - the Corporation's then currently effective prospectus and
Statement of Additional Information, as filed with the Securities and Exchange
Commission and supplemented from time to time.
Security or Securities - Money Market Securities, common stock,
preferred stock, options, financial futures, bonds, notes, debentures, corporate
debt securities, mortgages, bank certificates of deposit, bankers' acceptances,
mortgage-backed securities or other obligations and any certificates, receipts,
warrants, or other instruments or documents representing rights to receive,
purchase, or subscribe for the same or evidencing or representing any other
rights or interest therein, or any similar property or assets that the Custodian
has the facilities to clear and to service.
SEC - the Securities and Exchange Commission of the United States of
America.
<PAGE>
Shares - with respect to a Fund, the shares of common stock issued by
the Corporation on account of such Fund.
Written Instructions - communications in writing actually received by
the Custodian from an Authorized Person. A communication in writing includes a
communication by facsimile, telex or between electro-mechanical or electronic
devices (where the use of such devices have been approved by resolution of the
Board of Directors and the resolution is certified by an Officer and delivered
to the Custodian). All written communications shall be directed to the
Custodian, attention: Mutual Fund Custody Department.
ARTICLE II
Appointment; Acceptance; and Furnishing of Documents
----------------------------------------------------
A. Appointment of Custodian. The Corporation hereby constitutes and
appoints the Custodian as custodian of all Securities and cash owned by the
Corporation at any time during the term of this Agreement.
B. Acceptance of Custodian. The Custodian hereby accepts appointment as
such custodian and agrees to perform the duties thereof as hereinafter set
forth.
C. Documents to be Furnished. The following documents, including any
amendments thereto, will be provided contemporaneously with the execution of the
Agreement, to the Custodian by the Corporation:
1. A copy of the Articles of Incorporation of the
Corporation certified by the Secretary.
2. A copy of the By-Laws of the Corporation certified by
the Secretary.
3. A copy of the resolution of the Board of Directors of
the Corporation appointing the Custodian, certified by
the Secretary.
4. A copy of the then current Prospectus.
5. A Certificate of the President and Secretary of the
Corporation setting forth the names and signatures of
the current Officers of the Corporation and other
Authorized Persons.
<PAGE>
D. Notice of Appointment of Dividend and Transfer Agent. The
Corporation agrees to notify the Custodian in writing of the appointment,
termination or change in appointment of any Dividend and Transfer Agent.
ARTICLE III
Receipt of Corporation Assets
-----------------------------
A. Delivery of Moneys. During the term of this Agreement, the
Corporation will deliver or cause to be delivered to the Custodian all moneys to
be held by the Custodian for the account of any Fund. Subject to Article V,
Section A, the Custodian shall be entitled to reverse any deposits made on any
Fund's behalf where such deposits have been entered and moneys are not finally
collected within 30 days of the making of such entry.
B. Delivery of Securities. During the term of this Agreement, the
Corporation will deliver or cause to be delivered to the Custodian all
Securities to be held by the Custodian for the account of any Fund. The
Custodian will not have any duties or responsibilities with respect to such
Securities until actually received by the Custodian.
C. Payments for Shares. As and when received, the Custodian shall
deposit to the account(s) of a Fund any and all payments for Shares of that Fund
issued or sold from time to time as they are received from the Corporation's
distributor or Dividend and Transfer Agent or from the Corporation itself.
D. Duties Upon Receipt. The Custodian shall, acting on behalf of each
Fund, deposit any Fund assets in the Book-Entry System or a Depository. The
Custodian shall not be responsible for any Securities, moneys or other assets of
any Fund until actually received by it. The Custodian shall always be
accountable to the Corporation for Fund assets deposited by the Custodian.
E. Validity of Title. The Custodian shall not be responsible for the
title, validity or genuineness of any property or evidence of title thereto
received or delivered by it pursuant to this Agreement.
<PAGE>
ARTICLE IV
Disbursement of Corporation Assets
----------------------------------
A. Declaration of Dividends by Corporation. The Corporation shall
furnish to the Custodian a copy of the resolution of the Board of Directors of
the Corporation, certified by the Corporation's Secretary, either (i) setting
forth the date of the declaration of any dividend or distribution in respect of
Shares of any Fund of the Corporation, the date of payment thereof, the record
date as of which the Fund shareholders entitled to payment shall be determined,
the amount payable per share to Fund shareholders of record as of that date, and
the total amount to be paid by the Dividend and Transfer Agent on the payment
date, or (ii) authorizing the declaration of dividends and distributions in
respect of Shares of a Fund on a daily basis and authorizing the Custodian to
rely on Written Instructions setting forth the date of the declaration of any
such dividend or distribution, the date of payment thereof, the record date as
of which the Fund shareholders entitled to payment shall be determined, the
amount payable per share to Fund shareholders of record as of that date, and the
total amount to be paid by the Dividend and Transfer Agent on the payment date.
On the payment date specified in the resolution or Written Instructions
described above, the Custodian shall segregate such amounts from moneys held for
the account of the Fund so that they are available for such payment.
B. Segregation of Redemption Proceeds. Upon receipt of Proper
Instructions so directing it, the Custodian shall segregate amounts necessary
for the payment of redemption proceeds to be made by the Dividend and Transfer
Agent from moneys held for the account of the Fund so that they are available
for such payment.
C. Disbursements of Custodian. Upon receipt of Written Instructions
directing payment and setting forth the name and address of the person to whom
such payment is to be made, the amount of such payment, the name of the Fund
from which payment is to be made, and the purpose for which payment is to be
made, the Custodian shall disburse amounts as and when directed from the assets
of that Fund. The Custodian is authorized to rely any Written Instructions that
it reasonably believes to have been issued by an Authorized Person.
D. Payment of Custodian Fees. Upon receipt of Written Instructions
directing payment, the Custodian shall disburse moneys from the assets of the
Corporation in payment of the Custodian's fees and expenses as provided in
Article VIII hereof.
<PAGE>
ARTICLE V
Custody of Corporation Assets
-----------------------------
A. Separate Accounts for Each Fund. As to each Fund, the Custodian
shall open and maintain a separate bank account or accounts in the United States
in the name of the Corporation coupled with the name of such Fund, subject only
to draft or order by the Custodian acting pursuant to the terms of this
Agreement, and shall hold all cash received by it from or for the account of the
Fund, other than cash maintained by the Fund in a bank account established and
used by the Fund in accordance with Rule 17f-3 under the Act. Moneys held by the
Custodian on behalf of a Fund may be deposited by the Custodian to its credit as
Custodian in the banking department of the Custodian. Such moneys shall be
deposited by the Custodian in its capacity as such, and shall be withdrawable by
the Custodian only in such capacity.
B. Segregation of Non-Cash Assets. All Securities and non-cash property
held by the Custodian for the account of a Fund (other than Securities
maintained in a Depository or Book-entry System) shall be physically segregated
from other Securities and non-cash property in the possession of the Custodian
(including the Securities and non-cash property of the other Funds) and shall be
identified as subject to this Agreement.
C. Securities in Bearer and Registered Form. All Securities held which
are issued or issuable only in bearer form, shall be held by the Custodian in
that form; all other Securities held for the Fund may be registered in the name
of the Custodian, any sub-custodian appointed in accordance with this Agreement,
or the nominee of any of them. The Corporation agrees to furnish to the
Custodian appropriate instruments to enable the Custodian to hold, or deliver in
proper form for transfer, any Securities that it may hold for the account of any
Fund and which may, from time to time, be registered in the name of a Fund.
D. Duties of Custodian As to Securities. Unless otherwise instructed by
the Corporation, with respect to all Securities held for the Corporation, the
Custodian shall on a timely basis (concerning items 1 and 2 below, as defined in
the Custodian's Standards of Service Guide, as amended from time to time,
annexed hereto as Appendix D):
1. Collect all income due and payable with respect to
such Securities;
2. Present for payment and collect amounts payable upon
all Securities which may mature or be called,
redeemed, or retired, or otherwise become payable;
3. Surrender interim receipts or Securities in temporary
form for Securities in definitive form;
4. Execute, as Custodian, any necessary declarations or
certificates of ownership under the Federal income
tax laws or the laws or regulations of any other
taxing authority, including any foreign taxing
authority, now or hereafter in effect, and
5. Hold directly, or through the Book-Entry System or
the Depository with respect to Securities therein
deposited, for the account of any Fund, all rights
and similar securities issued with respect to any
Securities held by the Custodian hereunder.
E. Certain Actions Upon Written Instructions. Upon receipt of a Written
Instructions and not otherwise, the Custodian shall:
<PAGE>
1. Execute and deliver to such persons as may be
designated in such Written Instructions proxies,
consents, authorizations, and any other instruments
whereby the authority of the Corporation as
beneficial owner of any Securities may be exercised;
2. Deliver any Securities in exchange for other
Securities or cash issued or paid in connection with
the liquidation, reorganization, refinancing, merger,
consolidation, or recapitalization of any issuer, or
the exercise of any conversion privilege;
3. Deliver any Securities to any protective committee,
reorganization committee, or other person in
connection with the reorganization, refinancing,
merger, consolidation, recapitalization, or sale of
assets of any Corporation, and receive and hold under
the terms of this Agreement such certificates of
deposit, interim receipts or other instruments or
documents as may be issued to it to evidence such
delivery;
4. Make such transfers or exchanges of the assets of any
Fund and take such other steps as shall be stated in
the Written Instructions to be for the purpose of
effectuating any duly authorized plan of liquidation,
reorganization, merger, consolidation or
recapitalization of the Corporation; and
5. Deliver any Securities held for any Fund to the
depository agent for tender or other similar offers.
F. Custodian to Deliver Proxy Materials. The Custodian shall
promptly deliver to the Corporation all notices, proxy material and executed but
unvoted proxies pertaining to shareholder meetings of Securities held by any
Fund. The Custodian shall not vote or authorize the voting of any Securities or
give any consent, waiver or approval with respect thereto unless so directed by
Written Instructions.
<PAGE>
G. Custodian to Deliver Tender Offer Information. The Custodian shall
promptly deliver to the Corporation all information received by the Custodian
and pertaining to Securities held by any Fund with respect to tender or exchange
offers, calls for redemption or purchase, or expiration of rights. If the
Corporation desires to take action with respect to any tender offer, exchange
offer or other similar transaction, the Corporation shall notify the Custodian
at least five Business Days prior to the date on which the Custodian is to take
such action. The Corporation will provide or cause to be provided to the
Custodian all relevant information for any Security which has unique put/option
provisions at least five Business Days prior to the beginning date of the tender
period.
ARTICLE VI
Purchase and Sale of Securities
-------------------------------
A. Purchase of Securities. Promptly after each purchase of Securities
by the Corporation, the Corporation shall deliver to the Custodian (i) with
respect to each purchase of Securities which are not Money Market Securities,
Written Instructions, and (ii) with respect to each purchase of Money Market
Securities, Proper Instructions, specifying with respect to each such purchase
the:
1. name of the issuer and the title of the Securities,
2. the number of shares, principal amount purchased (and
accrued interest, if any) or other units purchased,
3. date of purchase and settlement,
4. purchase price per unit,
5. total amount payable,
6. name of the person from whom, or the broker through
which, the purchase was made,
7. the name of the person to whom such amount is
payable, and
8. Fund for which the purchase was made.
The Custodian shall, against receipt of Securities purchased by or for the
Corporation, pay out of the moneys held for the account of such Fund the total
amount specified in the Written Instructions, or Oral Instructions, if
applicable, to the person named therein. The Custodian shall not be under any
obligation to pay out moneys to cover the cost of a purchase of Securities for a
Fund, if in the relevant Fund custody account there is insufficient cash
available to the Fund for which such purchase was made.
<PAGE>
B. Sale of Securities. Promptly after each sale of Securities by a
Fund, the Corporation shall deliver to the Custodian (i) with respect to each
sale of Securities which are not Money Market Securities, Written Instructions,
and (ii) with respect to each sale of Money Market Securities, Proper
Instructions, specifying with respect to each such sale the:
1. name of the issuer and the title of the Securities,
2. number of shares, principal amount sold (and accrued
interest, if any) or other units sold,
3. date of sale and settlement,
4. sale price per unit,
5. total amount receivable,
6. name of the person to whom, or the broker through
which, the sale was made,
7. name of the person to whom such Securities are to be
delivered, and
8. Fund for which the sale was made.
The Custodian shall deliver the Securities against receipt of the total amount
specified in the Written Instructions, or Oral Instructions, if applicable.
Notwithstanding any other provision of this Agreement, the Custodian, when
properly instructed as provided herein to deliver Securities against payment,
shall be entitled, if in accordance with generally accepted market practice, to
deliver such Securities prior to actual receipt of final payment therefor. In
any such case, the Fund for which the Securities were delivered shall bear the
risk that final payment for the Securities may not be made or that the
Securities may be returned or otherwise held or disposed of by or through the
person to whom they were delivered, and the Custodian shall have no liability
for any of the foregoing.
C. Options. Promptly after the time as of which the Corporation, on
behalf of a Fund, either:
1. writes an option on securities,
<PAGE>
2. notifies the Custodian that its obligations in
respect of any put or call option, as described in
the Corporation's Prospectus, require that the Fund
deposit Securities or additional Securities with the
Custodian, specifying the type and value of
Securities required to be so deposited, or
3. notifies the Custodian that its obligations in
respect of any other Security, as described in the
Corporation's Prospectus, require that the Fund
deposit Securities or additional securities with the
Custodian, specifying the type and value of
Securities required to be so deposited,
the Custodian will cause to be segregated or identified as deposited, pursuant
to the Fund's obligations as set forth in the Prospectus, Securities of such
kinds and having such aggregate values as are required to meet the Fund's
obligations in respect thereof. The Corporation will provide to the Custodian,
as of the end of each trading day, the market value of the Fund's option
liability and the market value of its portfolio of common stocks.
D. Payment on Settlement Date. On contractual settlement date, the
account of the Fund will be charged for all purchased Securities settling on
that day, regardless of whether or not delivery is made. Likewise, on
contractual settlement date, proceeds from the sale of Securities settling that
day will be credited to the account of the Fund, irrespective of delivery. Any
such credit shall be conditioned upon actual receipt by Custodian of final
payment and may be reversed if final payment is not actually received in full.
E. Credit of Moneys Prior to Receipt. With respect to any credit given
prior to actual receipt of final payment, the Custodian may, in its sole
discretion and from time to time, permit a Fund to use funds so credited to its
Fund custody account in anticipation of actual receipt of final payment. Any
such funds shall be deemed a loan from the Custodian to the Corporation payable
on demand and bearing interest accruing from the date such loan is made up to
but not including the date on which such loan is repaid at the rate per annum
customarily charged by the Custodian on similar loans.
F. Segregated Accounts. The Custodian shall, upon receipt of Proper
Instructions so directing it, establish and maintain a segregated account or
accounts for and on behalf of a Fund. Cash and/or Securities may be transferred
into such account or accounts for specific purposes, to-wit:
<PAGE>
1. in accordance with the provision of any agreement
among the Corporation, the Custodian, and a
broker-dealer registered under the 1934 Act, and also
a member of the NASD (or any futures commission
merchant registered under the Commodity Exchange
Act), relating to compliance with the rules of the
Options Clearing Corporation and of any registered
national securities exchange, the Commodity Futures
Trading Commission, any registered contract market,
or any similar organization or organizations
requiring escrow or other similar arrangements in
connection with transactions by the Fund;
2. for purposes of segregating cash or Securities in
connection with options purchased, sold, or written
by the Fund or commodity futures contracts or options
thereon purchased or sold by the Fund;
3. for the purpose of compliance by the Fund with the
procedures required for reverse repurchase
agreements, firm commitment agreements, standby
commitment agreements, and short sales by Investment
Company Act Release No. 10666, or any subsequent
release or releases or rule or interpretation of the
SEC or its staff relating to the maintenance of
segregated accounts by registered investment
companies;
4. for the purpose of segregating collateral for loans
of Securities made by the Fund; and
5. for other proper corporate purposes, but only upon
receipt of, in addition to Proper Instructions, a
copy of a resolution of the Board of Directors,
certified by an Officer, setting forth the purposes
of such segregated account.
Each segregated account established hereunder shall be established and
maintained for a single Fund only. All Proper Instructions relating to a
segregated account shall specify the Fund involved.
<PAGE>
F. Advances for Settlement. Except as otherwise may be agreed upon by
the parties hereto, the Custodian shall not be required to comply with any
Written Instructions to settle the purchase of any Securities on behalf of a
Fund unless there is sufficient cash in the account(s) pertaining to such Fund
at the time or to settle the sale of any Securities from such an account(s)
unless such Securities are in deliverable form. Notwithstanding the foregoing,
if the purchase price of such Securities exceeds the amount of cash in the
account(s) at the time of such purchase, the Custodian may, in its sole
discretion, advance the amount of the difference in order to settle the purchase
of such Securities. The amount of any such advance shall be deemed a loan from
the Custodian to the Corporation payable on demand and bearing interest accruing
from the date such loan is made up to but not including the date such loan is
repaid at the rate per annum customarily charged by the Custodian on similar
loans.
ARTICLE VII
Corporation Indebtedness
------------------------
In connection with any borrowings by the Corporation, the Corporation
will cause to be delivered to the Custodian by a bank or broker requiring
Securities as collateral for such borrowings (including the Custodian if the
borrowing is from the Custodian), a notice or undertaking in the form currently
employed by such bank or broker setting forth the amount of collateral. The
Corporation shall promptly deliver to the Custodian Written Instructions
specifying with respect to each such borrowing: (a) the name of the bank or
broker, (b) the amount and terms of the borrowing, which may be set forth by
incorporating by reference an attached promissory note duly endorsed by the
Corporation, or a loan agreement, (c) the date, and time if known, on which the
loan is to be entered into, (d) the date on which the loan becomes due and
payable, (e) the total amount payable to the Corporation on the borrowing date,
and (f) the description of the Securities securing the loan, including the name
of the issuer, the title and the number of shares or other units or the
principal amount. The Custodian shall deliver on the borrowing date specified in
the Written Instructions the required collateral against the lender's delivery
of the total loan amount then payable, provided that the same conforms to that
which is described in the Written Instructions. The Custodian shall deliver, in
the manner directed by the Corporation, such Securities as additional
collateral, as may be specified in Written Instructions, to secure further any
transaction described in this Article VII. The Corporation shall cause all
Securities released from collateral status to be returned directly to the
Custodian and the Custodian shall receive from time to time such return of
collateral as may be tendered to it.
<PAGE>
The Custodian may, at the option of the lender, keep such collateral in
its possession, subject to all rights therein given to the lender because of the
loan. The Custodian may require such reasonable conditions regarding such
collateral and its dealings with third-party lenders as it may deem appropriate.
ARTICLE VIII
Concerning the Custodian
------------------------
A. Limitations on Liability of Custodian. Except as otherwise provided
herein, the Custodian shall not be liable for any loss or damage resulting from
its action or omission to act or otherwise, except for any such loss or damage
arising out of its own gross negligence, willful misconduct, or reckless
disregard of its duties under this Agreement. The Corporation shall defend,
indemnify and hold harmless the Custodian and its directors, officers, employees
and agents with respect to any loss, claim, liability or cost (including
reasonable attorneys' fees) arising or alleged to arise from or relating to the
Corporation's duties hereunder or any other action or inaction of the
Corporation or its Directors, officers, employees or agents, except such as may
arise from the grossly negligent action or omission, willful misconduct,
reckless disregard, or breach of this Agreement by the Custodian. The Custodian
shall indemnify, defend and hold harmless the Corporation and its Directors,
officers, employees or agents with respect to any loss, claim, liability or cost
(including reasonable attorneys' fees) arising or alleged to arise from or
relating to the Custodian's duties with respect to the Corporation hereunder or
any other action or inaction of the Custodian or its directors, officers,
employees, agents, nominees or Sub-Custodians as to a Fund, except such as may
arise from the grossly negligent action or omission, willful misconduct,
reckless disregard or breach of this Agreement by the Corporation, its
directors, officers, employees or agents. The Custodian shall be liable to the
Corporation for any proximate loss or damage resulting from the use of the
Book-Entry System or any Depository arising by reason of any gross negligence,
willful misconduct or reckless disregard on the part of the Custodian or any of
its employees, agents, nominees or Sub-Custodians. Nothing contained herein
shall preclude recovery by the Corporation, on behalf of a Fund, of principal
and of interest to the date of recovery on, securities incorrectly omitted from
the Fund's account or penalties imposed on the Corporation, in connection with a
Fund, for any failures to deliver securities. The Custodian shall be entitled to
rely on and may act upon the advice and opinion of counsel on questions of law
that arise under or relate to this Agreement, at the expense of the Corporation,
and shall be without liability for any action reasonably taken or omitted
pursuant to such advice or opinion of counsel unless counsel to the Corporation
shall, within a reasonable time after being promptly notified of the substance
of the legal advice received by the Custodian, have a differing interpretation
of such question of law.
<PAGE>
In any case in which one party hereto is asked to indemnify
the other or hold the other harmless, the party from whom indemnification is
sought (the "Indemnifying Party") shall be advised of all pertinent facts
concerning the situation in question, and the party claiming a right to
indemnification (the "Indemnified Party") will use reasonable care to identify
and notify the Indemnifying Party promptly concerning any situation which
reasonably presents or appears to present a claim for indemnification against
the Indemnifying Party. The Indemnifying Party shall have the option to defend
the Indemnified Party against any claim which may be the subject of the
indemnification. In the event the Indemnifying Party so elects, such defense
shall be conducted by counsel chosen by the Indemnifying Party and satisfactory
to the Indemnified Party. The Indemnifying Party will so notify the Indemnified
Party, whereupon such Indemnifying Party shall take over the complete defense of
the claim and the Indemnified Party shall sustain no further legal or other
expenses in such situation for which indemnification has been sought under this
paragraph except the expenses of any additional counsel retained by the
Indemnified Party. In no case shall any party claiming the right to
indemnification confess any claim or make any compromise in any case in which
the other party has been asked to indemnify such party (unless such confession
or compromise is made with such other party's prior written consent). The
provisions under this Section (Section A) shall survive the termination of this
Agreement.
B. Actions Not Required By Custodian. Without limiting the generality
of the foregoing, the Custodian, acting in the capacity of Custodian hereunder,
shall be under no obligation to inquire into, and shall not be liable for:
1. The validity of the issue of any Securities purchased
by or for the account of any Fund, the legality of
the purchase thereof, or the propriety of the amount
paid therefor;
2. The legality of the sale of any Securities by or for
the account of any Fund, or the propriety of the
amount for which the same are sold;
3. The legality of the issue or sale of any Shares of
any Fund, or the sufficiency of the amount to be
received therefor;
4. The legality of the redemption of any Shares of any
Fund, or the propriety of the amount to be paid
therefor;
5. The legality of the declaration or payment of any
dividend by the Corporation in respect of Shares of
any Fund;
6. The legality of any borrowing by the Corporation on
behalf of the Corporation or any Fund, using
Securities as collateral;
7. Subject to Article VIII, Section J, whether the
Corporation or a Fund is in compliance with the 1940
Act, the regulations thereunder, the provisions of
the Corporation's charter documents or by-laws, or
its investment objectives and policies as then in
effect.
C. No Duty to Collect Amounts Due From Dividend and Transfer Agent. The
Custodian shall not be under any duty or obligation to take action to effect
collection of any amount due to the Corporation from any Dividend and Transfer
Agent of the Corporation nor to take any action to effect payment or
distribution by any Dividend and Transfer Agent of the Corporation of any amount
paid by the Custodian to any Dividend and Transfer Agent of the Corporation in
accordance with this Agreement.
<PAGE>
D. No Enforcement Actions. Notwithstanding Section D of Article V, the
Custodian shall not be under any duty or obligation to take action, by legal
means or otherwise, to effect collection of any amount, if the Securities upon
which such amount is payable are in default, or if payment is refused after due
demand or presentation, unless and until (i) it shall be directed to take such
action by Written Instructions and (ii) it shall be assured to its satisfaction
(including prepayment thereof) of reimbursement of its costs and expenses in
connection with any such action.
E. Authority to Use Agents and Sub-Custodians. The Corporation
acknowledges and hereby authorizes the Custodian to hold Securities through its
various agents described in Appendix C annexed hereto. The Fund hereby
represents that such authorization has been duly approved by the Board of
Directors of the Corporation as required by the Act.
In addition, the Corporation acknowledges that the Custodian may
appoint one or more financial institutions, as agent or agents or as
sub-custodian or sub-custodians, including, but not limited to, banking
institutions located in foreign countries, for the purpose of holding Securities
and moneys at any time owned by the Fund, provided such agent or sub-custodian
is eligible to hold the Corporation's assets under Section 17(f) of the Act and
the rules thereunder. The Custodian shall not be relieved of any obligation or
liability under this Agreement in connection with the appointment or activities
of such agents or sub-custodians. Any such agent or sub-custodian shall be
qualified to serve as such for assets of investment companies registered under
the Act. The Funds shall reimburse the Custodian for all costs incurred by the
Custodian in connection with opening accounts with any such agents or
sub-custodians. Upon request, the Custodian shall promptly forward to the
Corporation any documents it receives from any agent or sub-custodian appointed
hereunder which may assist directors of registered investment companies to
fulfill their responsibilities under Rule 17f-5 of the Act.
F. No Duty to Supervise Investments. The Custodian shall not be
under any duty or obligation to ascertain whether any Securities at any time
delivered to or held by it for the account of the Corporation are such as
properly may be held by the Corporation under the provisions of the Articles of
Incorporation and the Corporation's By-Laws.
<PAGE>
G. All Records Confidential. The Custodian shall treat all records and
other information relating to the Corporation and the assets of all Funds as
confidential and shall not disclose any such records or information to any other
person unless (i) the Corporation shall have consented thereto in writing or
(ii) such disclosure is required by law.
H. Compensation of Custodian. The Custodian shall be entitled to
receive and the Corporation agrees to pay to the Custodian such compensation as
shall be determined pursuant to Appendix E attached hereto, or as shall be
determined pursuant to amendments to Appendix E. The Custodian shall be entitled
to charge against any money held by it for the account of any Fund, the amount
of any of its fees, any loss, damage, liability or expense, including reasonable
counsel fees for which it is entitled to reimbursement under the terms of this
Agreement or by the final order of any court or arbitrator having jurisdiction
and as to which all rights of appeal shall have expired. The expenses which the
Custodian may charge against the account of a Fund include, but are not limited
to, the expenses of agents or sub-custodians incurred in settling transactions
involving the purchase and sale of Securities of the Fund.
I. Reliance Upon Instructions. The Custodian shall be entitled to rely
upon any Proper Instructions which it reasonably believes to have been issued by
an Authorized Person. The Corporation agrees to forward to the Custodian Written
Instructions confirming Oral Instructions in such a manner so that such Written
Instructions are received by the Custodian, whether by hand delivery, telex,
facsimile or otherwise, on the same Business Day on which such Oral Instructions
were given. The Corporation agrees that the failure of the Custodian to receive
such confirming instructions shall in no way affect the validity of the
transactions or enforceability of the transactions hereby authorized by the
Corporation. The Corporation agrees that the Custodian shall incur no liability
to the Corporation for acting upon Oral Instructions that it reasonably believes
to have been given by an Authorized Person to the Custodian hereunder concerning
such transactions.
J. Books and Records. The Custodian will (i) set up and maintain proper
books of account and complete records of all transactions in the accounts
maintained by the Custodian hereunder in such manner as will meet the
obligations of the Fund under the Act, with particular attention to Section 31
thereof and Rules 3la-1 and 3la-2 thereunder and those records are the property
of the Corporation, and (ii) preserve for the periods prescribed by applicable
Federal statute or regulation all records required to be so preserved. All such
books and records shall be the property of the Corporation, and shall be
available, upon request, for inspection by duly authorized officers, employees
or agents of the Corporation and employees of the SEC. Promptly after the close
of business on each day a Fund is open and valuing its portfolio, the Custodian
shall furnish the Corporation with a detailed statement of monies held for each
Fund under this Agreement and with confirmations and a summary of all transfers
to or from the account of the Fund(s) during said day. Where securities are
transferred to the account of a Fund without physical delivery, the Custodian
shall also identify as belonging to the Fund a quantity of securities in a
fungible bulk of securities registered in the name of the Custodian (or its
nominee) or shown on the Custodian's account on the books of the Book-Entry
System or the Depository. At least monthly and from time to time, the Custodian
shall furnish the Corporation with a detailed statement of the securities held
for each Fund under this Agreement.
<PAGE>
K. Internal Accounting Control Systems. The Custodian shall promptly
send to the Corporation any report received on the systems of internal
accounting control of the Custodian, its agents or sub-custodians, or the
Book-Entry System or Depository, as the Corporation may reasonably request from
time to time.
L. No Management of Assets By Custodian. The Custodian performs only
the services of a custodian and shall have no responsibility for the management,
investment or reinvestment of the Securities or other assets from time to time
owned by any Fund. The Custodian is not a selling agent for Shares of any Fund
and performance of its duties as custodian shall not be deemed to be a
recommendation to any Fund's depositors or others of Shares of the Fund as an
investment. The Custodian shall have no duties or obligations whatsoever except
such duties and obligations as are specifically set forth in this Agreement, and
no covenant or obligation shall be implied in this Agreement against the
Custodian.
M. Assistance to Corporation. The Custodian shall take all reasonable
action, that the Corporation may from time to time request, to assist the
Corporation in obtaining favorable opinions from the Corporation's independent
accountants, with respect to the Custodian's activities hereunder, in connection
with the preparation of the Fund's Form N-1A, Form N-SAR, or other annual
reports to the SEC.
N. Grant of Security Interest. The Corporation hereby pledges to and
grants the Custodian a security interest in the assets of any Fund to secure the
payment of any liabilities of that Fund to the Custodian under this Agreement,
whether acting in its capacity as Custodian or otherwise, or on account of money
borrowed from the Custodian. This pledge is in addition to any other pledge of
collateral by the Corporation to the Custodian.
ARTICLE IX
Initial Term; Termination
-------------------------
A. Initial Term. This Agreement shall become effective as of its
execution and shall continue in full force and effect until terminated as
hereinafter provided.
B. Termination. Either party hereto may terminate this
Agreement for any reason by giving to the other party a notice in writing
specifying the date of such termination, which shall be not less than sixty (60)
days after the date of giving of such notice. If such notice is given by the
Corporation, it shall be accompanied by a copy of a resolution of the Board of
Directors of the Corporation, certified by the Secretary of the Corporation,
electing to terminate this Agreement and designating a successor custodian or
custodians. In the event such notice is given by the Custodian, the Corporation
shall, on or before the termination date, deliver to the Custodian a copy of a
resolution of the Board of Directors of the Corporation, certified by the
Secretary, designating a successor custodian or custodians to act on behalf of
the Corporation. In the absence of such designation by the Corporation, the
Custodian may designate a successor custodian which shall be a bank or
Corporation company having not less than $100,000,000 aggregate capital,
surplus, and undivided profits. Upon the date set forth in such notice this
Agreement shall terminate, and the Custodian, provided that it has received a
notice of acceptance by the successor custodian, shall deliver, on that date,
directly to the successor custodian all Securities and moneys then owned by the
Fund and held by it as Custodian. Upon termination of this Agreement, the
Corporation shall pay to the Custodian such compensation as may be due as of the
date of such termination. The Corporation agrees that the Custodian shall be
reimbursed for its reasonable costs in connection with the termination of this
Agreement.
C. Failure to Designate Successor Custodian. If a successor custodian
is not designated by the Corporation, or by the Custodian in accordance with the
preceding paragraph, or the designated successor cannot or will not serve, the
Corporation shall, upon the delivery by the Custodian to the Corporation of all
Securities (other than Securities held in the Book-Entry System which cannot be
delivered to the Corporation) and moneys then owned by the Corporation, be
deemed to be the custodian for the Corporation, and the Custodian shall thereby
be relieved of all duties and responsibilities pursuant to this Agreement, other
than the duty with respect to Securities held in the Book-Entry System, which
cannot be delivered to the Corporation, which shall be held by the Custodian in
accordance with this Agreement.
ARTICLE X
Force Majeure
-------------
Neither the Custodian nor the Corporation shall be liable for any
failure or delay in performance of its obligations under this Agreement arising
out of or caused, directly or indirectly, by circumstances beyond its reasonable
control, including, without limitation, acts of God; earthquakes; fires; floods;
wars; civil or military disturbances; sabotage; strikes; epidemics; riots; power
failures; computer failure and any such circumstances beyond its reasonable
control as may cause interruption, loss or malfunction of utility,
transportation, computer (hardware or software) or telephone communication
service; accidents; labor disputes; acts of civil or military authority;
governmental actions; or inability to obtain labor, material, equipment or
transportation; provided, however, that the Custodian, in the event of a failure
or delay, shall use its best efforts to ameliorate the effects of any such
failure or delay.
<PAGE>
ARTICLE XI
Miscellaneous
-------------
A. Designation of Authorized Persons. Appendix A sets forth the names
and the signatures of all Authorized Persons as of this date, as certified by
the Secretary of the Corporation. The Corporation agrees to furnish to the
Custodian a new Appendix A in form similar to the attached Appendix A, if any
present Authorized Person ceases to be an Authorized Person or if any other or
additional Authorized Persons are elected or appointed. Until such new Appendix
A shall be received, the Custodian shall be fully protected in acting under the
provisions of this Agreement upon Oral Instructions or signatures of the then
current Authorized Persons as set forth in the last delivered Appendix A.
B. Limitation of Personal Liability. No recourse under any obligation
of this Agreement or for any claim based thereon shall be had against any
organizer, shareholder, officer, director, past, present or future as such, of
the Corporation or of any predecessor or successor, either directly or through
the Corporation or any such predecessor or successor, whether by virtue of any
constitution, statute or rule of law or equity, or by the enforcement of any
assessment or penalty or otherwise; it being expressly agreed and understood
that this Agreement and the obligations thereunder are enforceable solely
against the Corporation, and that no such personal liability whatever shall
attach to, or is or shall be incurred by, the organizers, shareholders,
officers, or directors of the Corporation or of any predecessor or successor, or
any of them as such. To the extent that any such liability exists, it is hereby
expressly waived and released by the Custodian as a condition of, and as a
consideration for, the execution of this Agreement.
C. Authorization By Board. The obligations set forth in this Agreement
as having been made by the Corporation have been made by the Board of Directors,
acting as such Directors for and on behalf of the Corporation, pursuant to the
authority vested in them under the laws of the State of Maryland, the Articles
of Incorporation and the By-Laws of the Corporation. This Agreement has been
executed by Officers of the Corporation as officers, and not individually, and
the obligations contained herein are not binding upon any of the Directors,
Officers, agents or holders of shares, personally, but bind only the
Corporation.
<PAGE>
D. Custodian's Consent to Use of Its Name. The Corporation shall review
with the Custodian all provisions of the Prospectus and any other documents
(including advertising material) specifically mentioning the Custodian (other
than merely by name and address) and shall obtain the Custodian's consent prior
to the publication and/or dissemination or distribution thereof.
E. Notices to Custodian. Any notice or other instrument in writing,
authorized or required by this Agreement to be given to the Custodian, shall be
sufficiently given if addressed to the Custodian and mailed or delivered to it
at its offices at Star Bank Center, 425 Walnut Street, M. L. 6118, Cincinnati,
Ohio 45202, attention Mutual Fund Custody Department, or at such other place as
the Custodian may from time to time designate in writing.
F. Notices to Corporation. Any notice or other instrument in writing,
authorized or required by this Agreement to be given to the Corporation shall be
sufficiently given when delivered to the Corporation or on the second Business
Day following the time such notice is deposited in the U.S. mail postage prepaid
and addressed to the Corporation at its office at 479 W. 22nd St. New York, NY
10011 or at such other place as the Corporation may from time to time designate
in writing.
G. Amendments In Writing. This Agreement, with the exception of the
Appendices, may not be amended or modified in any manner except by a written
agreement executed by both parties with the same formality as this Agreement,
and authorized and approved by a resolution of the Board of Directors of the
Corporation.
H. Successors and Assigns. This Agreement shall extend to and shall be
binding upon the parties hereto, and their respective successors and assigns;
provided, however, that this Agreement shall not be assignable by the
Corporation or by the Custodian, and no attempted assignment by the Corporation
or the Custodian shall be effective without the written consent of the other
party hereto.
I. Governing Law. This Agreement shall be construed in accordance with
the laws of the State of Ohio.
<PAGE>
J. Jurisdiction. Any legal action, suit or proceeding to be instituted
by either party with respect to this Agreement shall be brought by such party
exclusively in the courts of the State of Ohio or in the courts of the United
States for the Southern District of Ohio, and each party, by its execution of
this Agreement, irrevocably (i) submits to such jurisdiction and (ii) consents
to the service of any process or pleadings by first class U.S. mail, postage
prepaid and return receipt requested, or by any other means from time to time
authorized by the laws of such jurisdiction.
K. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but such
counterparts shall, together, constitute only one instrument.
L. Headings. The headings of paragraphs in this Agreement are for
convenience of reference only and shall not affect the meaning or construction
of any provision of this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective Officers, thereunto duly authorized as of the day
and year first above written.
ATTEST: CORPORATION:
Fleming Capital Mutual Fund Group, Inc.
By: /s/ Jonathan Simon
----------------------
Title: President
---------
ATTEST: CUSTODIAN:
Star Bank, N.A.
By: Marsha A. Croxton
---------------------
Title: Senior Vice President
-----------------------
<PAGE>
APPENDIX A
Authorized Persons Specimen Signatures
------------------ -------------------
President: __________________ ___________________
Vice President: __________________ ___________________
Secretary: __________________ ___________________
Treasurer: __________________ ___________________
Assistant
Treasurer: __________________ ___________________
Adviser Employees: __________________ ___________________
<PAGE>
APPENDIX A Continued
Authorized Persons Specimen Signatures
------------------ -------------------
Transfer Agent/Fund Accountant
Employees: __________________ ___________________
__________________ ___________________
__________________ ___________________
__________________ ___________________
* Authority restricted; does not include:___________________________________
- -----------------------------------------------------------------------------
<PAGE>
APPENDIX B
Series of the Corporation
Fleming Fund
Fleming Fledgling Fund
<PAGE>
APPENDIX C
Agents of the Custodian
The following agents are employed currently by Star Bank, N.A. for securities
processing and control ...
The Depository Trust Company (New York)
7 Hanover Square
New York, NY 10004
The Federal Reserve Bank
Cincinnati and Cleveland Branches
Bankers Trust Company
16 Wall Street
New York, NY 10005
(For Foreign Securities and certain non-DTC eligible Securities)
<PAGE>
APPENDIX D
Standards of Service Guide
<PAGE>
APPENDIX E
Schedule of Compensation
Domestic Custody Fee Schedule for Fleming Capital Mutual Fund Group, Inc.
Star Bank, N.A., as Custodian, will receive monthly compensation for services
according to the terms of the following Schedule:
I. Portfolio Transaction Fees:
(a) For each repurchase agreement transaction $7.00
(b) For each portfolio transaction processed through
DTC or Federal Reserve $9.00
(c) For each portfolio transaction processed through
our New York custodian $25.00
(d) For each GNMA/Amortized Security Purchase $16.00
(e) For each GNMA Prin/Int Paydown, GNMA Sales $8.00
(f) For each option/future contract written,
exercised or expired $40.00
(g) For each Cedel/Euro clear transaction $80.00
(h) For each Disbursement (Fund expenses only) $5.00
A transaction is a purchase/sale of a security, free receipt/free delivery
(excludes initial conversion), maturity, tender or exchange:
II. Market Value Fee (aggregate for all funds in the series Corporation)
Based upon an annual rate of: Million
-------
.00020 (2.0 Basis Points) on First $25
.00015 (1.5 Basis Points) on Next $25
.00010 (1.0 Basis Point) on Balance
III. Monthly Minimum Fee-Per Fund $300.00
IV. Out-of-Pocket Expenses
The only out-of-pocket expenses charged to your account will be
shipping fees or transfer fees.
V. Earnings Credits
On a monthly basis any earnings credits generated from uninvested
custody balances will be applied against any cash management service
fees generated. Earnings credits are based on a Cost of Funds Tiered
Earnings Credit Rate.
<PAGE>
APPENDIX E
Schedule of Compensation Continued
<TABLE>
<CAPTION>
Services Unit Cost ($) Monthly Cost ($)
- ------------------------------------------------------------------------------------------------
<S> <C> <C>
D.D.A. Account Maintenance 14.00
Deposits .399
Deposited Items .109
Checks Paid .159
Balance Reporting - P.C. Access 50.00
ACH Transaction .095
ACH Monthly Maintenance 40.00
Controlled Disbursement (1st account) 110.00
Each additional account 25.00
Deposited Items Returned 6.00
International Items Returned 10.00
NSF Returned Checks 25.00
Stop Payments 22.00
Data Transmission per account 110.00
Data Capture* .10
Drafts Cleared .179
Lockbox Maintenance** 55.00
Lockbox items Processed
with copy of check .32
without copy of check .26
Checks Printed .20
Positive Pay .06
Issued Items .015
Wires Incoming
Domestic 10.00
International 10.00
Wires Outgoing
Domestic
Repetitive 12.00
Non-Repetitive 13.00
International
Repetitive 35.00
Non-Repetitive 40.00
PC - Initiated Wires:
Domestic
Repetitive 9.00
Non-Repetitive 9.00
International
Repetitive 25.00
Non-Repetitive 25.00
- ----------------------------
***Uncollected Charge Star Bank Prime Rate as of
first of month plus 4%
</TABLE>
* Price can vary depending upon what information needs to be captured
** _______ With the use of lockbox, the collected balance in the demand
deposit account will be significantly increased and therefore earnings
to offset cash management service fees will be maximized.
*** Fees for uncollected balances are figured on the monthly average of all
combined accounts.
**** Other available cash management services are priced separately.
Revised 10/31/95
Exhibit - 99.B9(a)
ADMINISTRATION AGREEMENT
AGREEMENT made this 30th day of September, 1997 by and between
Fleming Capital Mutual Fund Group, Inc., a Maryland Corporation (the "Company"
or the "Fund"), and INVESTMENT COMPANY ADMINISTRATION CORPORATION, a Delaware
Corporation (the "Administrator").
W I T N E S S E T H
-------------------
WHEREAS, the Fund is registered as an open-end management
investment company under the Investment Company Act of 1940 (the "1940 Act"),
with shares of beneficial interest organized into separate series; and
WHEREAS, the Fund wishes to retain the Administrator, and the
Administrator is willing, to provide management and administrative services to
such Portfolios of the Fund as the Fund and Administrator may agree upon
("Portfolios") and as listed on Schedule A attached hereto and made a part of
this agreement on the terms and conditions hereinafter set forth:
NOW THEREFORE, in consideration of the promises and mutual
covenants herein contained, it is agreed between the parties hereto as follows:
1. Appointment. The Fund hereby retains the Administrator to
provide certain management and administrative services, as set forth in Article
2 below. The Administrator agrees to comply with all applicable requirements of
the 1940 Act, the Securities Act of 1933, the Securities Exchange Act of 1934
and any laws, rules and regulations of governmental or quasi-governmental
authorities having jurisdiction with respect to the duties to be performed by
the Administrator hereunder.
2. Services on a Continuing Basis. The Administrator shall
perform the following services on a regular basis which would be daily, weekly
or as otherwise appropriate or reasonably requested by the Fund:
(A) prepare and coordinate reports and other
materials as the Fund's Board of
Directors may reasonably request of the Fund;
(B) prepare and/or supervise the preparation and
filing of all securities filings, periodic financial reports, prospectuses,
statements of additional information, marketing materials, tax returns,
shareholder reports and other regulatory reports or filings required of the Fund
and the Portfolios;
<PAGE>
(C) prepare all required filings necessary to qualify
the Fund's shares with state securities authorities to sell shares in all states
where the Fund currently does, or intends to do business;
(D) coordinate the preparation, printing and mailing
of all communications required to be sent to shareholders, including the annual
and semi-annual reports to shareholders, proxy statements, notices and other
reports to Fund shareholders;
(E) coordinate the preparation and payment of Fund
and Portfolio related expenses;
(F) assist in the selection of, investigate, conduct
relations with, and monitor and oversee the activities of the transfer agent,
custodians, accountants, depositories, attorneys, underwriters, insurers, and
such other persons in any other capacity deemed by the Company to be necessary
or desirable for the Portfolios' operations and as requested by the Company;
(G) review and adjust as necessary the Portfolios'
daily expense accruals;
(H) maintain and keep such books and records of the
Fund as required by law and for the proper operation of the Fund and its
Portfolios other than those maintained and kept by the Fund's investment adviser
and servicing agents;
(I) provide the Fund with (i) the services of persons
competent to perform the administrative and clerical functions described herein,
and (ii) individuals acceptable to the Directors for nomination, appointment or
election as officers of the Fund, who will be responsible for the management of
certain of the Fund's affairs as determined by the Directors;
(J) provide the Fund with office space as well as
administrative offices, equipment and facilities as are necessary for the
performance of the Administrator's duties under this Agreement;
(K) monitor each Portfolio's compliance with
investment policies and restrictions as set forth in the Portfolio's currently
effective prospectus and statement of additional information; and
(L) perform such additional services as may be agreed
upon by the Fund and the Administrator.
<PAGE>
3. Responsibility of the Administrator. The Administrator
shall be under no duty to take any action on behalf of the Fund or the
Portfolios except as set forth herein or as may be agreed to by the
Administrator in writing. In the performance of its duties hereunder, the
Administrator shall be obligated to exercise reasonable care and diligence and
to act in good faith and to use its best efforts. The Administrator shall have
no liability for any loss or damage resulting from the performance or
non-performance of its duties hereunder unless solely caused by or resulting
from the gross negligence or willful misconduct of the Administrator, its
officers and employees.
4. Reliance Upon Instructions. The Fund agrees that the
Administrator shall be entitled to rely upon any instructions, oral or written,
actually received by the Administrator from the Fund and shall incur no
liability to the Fund in acting upon such oral or written instructions, provided
such instructions reasonably appear to have been received from a person duly
authorized by the Board of Directors of the Fund to give oral or written
instructions on behalf of the Fund or any Portfolio.
5. Confidentiality. The Administrator agrees on behalf of
itself and its employees to treat confidentiality all records and other
information relating to the Fund and Portfolios and all prior, present or
potential shareholders of any and all Portfolios, except after prior
notification to, and written approval of release of information by, the Fund,
which approval shall not be unreasonably withheld where the Administrator 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 Fund.
6. Equipment Failures. In the event of equipment failures or
the occurrence of events beyond the Administrator's control which render the
performance of the Administrator's functions under this Agreement impossible,
the Administrator shall at no additional expense to the Fund, take reasonable
steps to minimize service interruptions. The Administrator shall develop and
maintain a plan for recovery from equipment failures which may include
contractual arrangements with appropriate third parties making reasonable
provision for emergency use of electronic data processing equipment to the
extent appropriate equipment is available.
7. Allocation of Charges and Expenses.
(A) The Administrator. The Administrator shall
furnish at its own expense the executive, supervisory and clerical personnel
necessary to perform its obligations under this Agreement. The Administrator
shall also provide the items which it is obligated to provide under this
Agreement, and shall pay all compensation, if any, of officers of the Fund as
well as all Directors of the Fund who are affiliated persons of the
Administrator or any affiliated corporation of the Administrator; provided,
however, that unless otherwise specifically provided, the Administrator shall
not be obligated to pay the compensation of any employee of the Fund retained by
the Directors of the Fund to perform services on behalf of the Fund.
<PAGE>
(B) The Fund. The Fund assumes and shall pay or cause
to be paid all other expenses of the Fund not otherwise allocated herein,
including, without limitation, organizational costs, taxes, expenses for legal
and auditing services, the expenses of preparing (including typesetting),
printing and mailing reports, prospectuses, statements of additional
information, proxy solicitation material and notices to existing shareholders,
all expenses incurred in connection with issuing and redeeming shares, the costs
of pricing services, the costs of custodial services, the cost of initial and
ongoing registration of the shares under federal and state securities laws, fees
and out-of-pocket expenses of Directors who are not affiliated persons of the
Administrator or the investment adviser to the Fund or any affiliated
corporation of the Administrator or the investment Adviser, the costs of
Directors' meetings, insurance, interest, brokerage costs, litigation and other
extraordinary or nonrecurring expenses, and all fees and charges of investment
advisers to the Fund.
8. Compensation. As compensation for services rendered by the
Administrator during the term of this Agreement, the Fund shall pay to the
Administrator compensation at an annual rate as set forth in Schedule A.
9. Indemnification.
(A) The Fund and Portfolios agree to indemnify and
hold harmless the Administrator from all taxes, filing fees, charges,
assessments, claims and liabilities (including without limitation, liabilities
arising under the Securities Act of 1933, the Securities Exchange Act of 1934,
the 1940 Act, and any state and foreign securities laws, all as amended from
time to time) and expenses, including (without limitation) reasonable attorneys
fees and disbursements, reasonably arising directly or indirectly from any
action or thing which the Administrator takes or does or omits to take or do at
the request of or in reliance upon the advice of the Board of Directors of the
Fund, provided that the Administrator will not be indemnified against any
liability to a Portfolio or to shareholders (or any expenses incident to such
liability) arising out of the Administrator's own willful misfeasance, bad
faith, gross negligence or reckless disregard of its duties and obligations
under this Agreement. The Administrator agrees to indemnify and hold harmless
the Fund and each of its Directors from all taxes, filing fees, charges,
assessments, claims and liabilities (including without limitation, liabilities
under the Securities Act of 1933, the Securities Exchange Act of 1934, the 1940
Act, and any state and foreign securities laws, all as amended from time to
time) and expenses, including (without limitation) reasonable attorneys fees and
disbursements, arising directly or indirectly from any action or thing which the
Administrator takes or does or omits to take or do which is in violation of this
Agreement or not in accordance with instructions properly given to the
Administrator, or arising out of the Administrator's own willful misfeasance,
bad faith, gross negligence or reckless disregard of its duties and obligations
under this agreement.
(B) The rights of a party indemnified under this
Section (an "indemnified party") shall include the right to reasonable advances
of defense expenses in the event of any pending or threatened litigation with
respect to which indemnification hereunder may ultimately be merited. In order
that the indemnification provisions contained herein shall apply, however, it is
understood that if in any case one party (the "indemnifying party") may be asked
to indemnify or hold the indemnified party harmless, the indemnifying party
shall be fully and promptly advised of all pertinent facts concerning the
situation in question, and it is further understood that the indemnified party
will use all reasonable care to identify and notify the indemnifying party
promptly concerning any situation which presents or appears likely to present
the probability of such a claim for indemnification against the indemnifying
party, but failure to do so in good faith shall not affect the rights hereunder.
<PAGE>
(C) The indemnifying party shall be entitled to
participate at its own expense or, if it so elects, to assume the defense of any
suit brought to enforce any claims subject to this indemnity provision. If the
indemnifying party elects to assume the defense of any such claim, the defense
shall be conducted by counsel chosen by the indemnifying party and satisfactory
to the indemnified party, whose approval shall not be unreasonably withheld. In
the event that the indemnifying party elects to assume the defense of any suit
and retain counsel, the indemnified party shall bear the fees and expenses of
any additional counsel retained by it. If the indemnifying party does not elect
to assume the defense of a suit, it will reimburse the indemnified party for the
reasonable fees and expenses of any counsel retained by the indemnified party.
10. Duration and Termination of this Agreement. This Agreement
shall continue until termination in accordance with the provisions of this
Section. This Agreement may be terminated only: (a) by the mutual written
agreement of the parties; (b) by either party on 60 days' written notice; or (c)
by either party in the event of a material breach of this Agreement by the other
party, provided the terminating party has notified the other party in writing of
such breach at least 45 days prior to the specified date of termination and the
breaching party has not remedied such breach by the specified date. This
Agreement shall not be assigned by either party without the prior written
consent of the other party
11. Amendments and Assignment. This Agreement or any part
hereof may be changed or waived only by instrument in writing signed by both
parties and may not be assigned by either party without the written consent of
the other.
12. Records. The Administrator shall, directly or through
third parties, maintain and preserve for the periods prescribed therein, records
relating to the services to be performed under this Agreement which are required
under the 1940 Act, and the rules and regulations thereunder. Any records
required to be maintained and preserved under the 1940 Act which are prepared or
maintained by the Administrator on behalf of the Fund shall be prepared and
maintained at the expense of the Administrator, but shall be the property of the
Fund, shall be readily accessible during normal business hours to the Fund and
its duly authorized agents, and shall be surrendered promptly to the Fund on
written request or upon termination of this Agreement. Records shall be
surrendered in usable machine readable form. In case of any request or demand
for the inspection of such records by another party, the Administrator shall
notify the Fund and follow the Fund's instructions as to permitting or refusing
such inspection; provided that the Administrator may exhibit such records to any
person in any case where it is advised by its counsel that it may be held liable
for failure to do so, unless (in cases involving potential exposure only to
civil liability) the Fund has agreed to indemnify the Administrator against such
liability.
<PAGE>
13. Notice. Any notice required or permitted to be given by
either party to the other shall be deemed sufficient if sent by registered or
certified mail, postage prepaid, to the following addresses or such other
addresses provided in writing: if to the Fund, at 320 Park Avenue, New York, New
York; and if to the Administrator at 2025 E. Financial Way, Suite 101, Glendora,
CA 91741.
14. Miscellaneous. This Agreement embodies the entire
agreement and understanding between the parties thereto with respect to the
services to be performed hereunder, and supersedes all prior agreements and
understandings, relating to the subject matter hereof. The captions in this
Agreement are included for convenience of reference only and in no way define or
limit any of the provisions hereof or otherwise affect their construction or
effect. This Agreement shall be deemed to be a contract made in New York and
governed by New York law. If any provision of this Agreement shall be held or
made invalid by a court decision, statute, rule or otherwise, the remainder of
this Agreement will not be affected thereby. This Agreement shall be binding
upon and shall inure to the benefit of the parties hereto and their respective
successors. This Agreement may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their officers designated below on the date first
written above.
FLEMING CAPITAL MUTUAL FUND GROUP, INC.
By: /s/ Jonathan K.L. Simon
---------------------------
Name: Jonathon K. L. Simon
Title:President
INVESTMENT COMPANY ADMINISTRATION CORPORATION
By: /s/ Eric M. Banhazl
-----------------------
Name: Eric M. Banhazl
Title: Executive Vice President
<PAGE>
Schedule to the Administration Agreement
Dated as of __________, 1997
between
Fleming Capital Mutual Fund Group, Inc.
and
Investment Company Administration Corporation
Portfolios: Fleming Fund
Fleming Fledgling Fund
Fees: Pursuant to Section 12 of the Agreement, the Fund shall pay
the Administrator compensation for services rendered to the
Portfolios at the following annual rates for each Portfolio
listed above, with a minimum fee of $40,000 annual per
Portfolio:
Average Daily Net Assets Rate
------------------------ ----
$0 - $200 million 0.10%
200,000,001 - 500,000,000 0.05%
500,000,001 and greater 0.03%
Term: This Agreement shall become effective on _______, 1997 and
shall remain in effect for an Initial Term of _______ year(s)
from such date and, thereafter, for successive Renewal Terms
of _______ year(s) each, unless and until this Agreement is
terminated in accordance with the provisions of Section ____
of the Agreement.
Exhibit 99.B9(b)
TRANSFER, DIVIDEND DISBURSING, SHAREHOLDER SERVICE
AND PLAN AGENCY AGREEMENT
AGREEMENT dated as of September 30, 1997 between Fleming Capital Mutual
Fund Group, Inc. (the "Corporation"), a Maryland Corporation, and Countrywide
Fund Services, Inc. ("Countrywide"), an Ohio corporation.
WHEREAS, the Corporation is an investment company registered under the
Investment Company Act of 1940, as amended (the "1940 Act"); and
WHEREAS, the Corporation wishes to employ the services of Countrywide
to serve as its transfer, dividend disbursing, shareholder service and plan
agent with respect to the Corporation and each series identified on Schedule A
(each, a "Fund" and collectively, the "Funds"), which may be amended by
agreement of the parties from time to time; and
WHEREAS, Countrywide wishes to provide such services under the
conditions set forth below;
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained in this Agreement, the Corporation and Countrywide agree as follows:
1. APPOINTMENT.
------------
The Corporation hereby appoints and employs Countrywide as
agent to perform those services described in this Agreement for the Corporation.
Countrywide shall act under such appointment and perform the obligations thereof
upon the terms and conditions hereinafter set forth.
2. DOCUMENTATION.
--------------
The Corporation will furnish from time to time the following
documents:
A. Each resolution of the Board of Directors of the Corporation
authorizing the original issue of its shares;
B. Each Registration Statement filed with the Securities and
Exchange Commission (the "SEC") and amendments thereof;
C. A certified copy of each amendment to the Article of
Incorporation and the Bylaws of the Corporation;
D. Certified copies of each resolution of the Board of Directors
authorizing officers to give instructions to Countrywide;
E. Specimens of all new forms of share certificates accompanied
by Board of Directors' resolutions approving such forms;
<PAGE>
F. Such other certificates, documents or opinions which
Countrywide may, in its discretion, deem necessary or
appropriate in the proper performance of its duties;
G. Copies of all Investment Advisory Agreements in effect; and
H. Copies of all documents relating to special investment or
withdrawal plans which are offered or may be offered in the
future by the Corporation and for which Countrywide is to act
as plan agent.
3. COUNTRYWIDE TO RECORD SHARES.
-----------------------------
Countrywide shall record the issuance of shares of the
Corporation and maintain pursuant to applicable rules of the SEC a record of the
total number of shares of the Corporation which are authorized, issued and
outstanding, based upon data provided to it by the Corporation. Countrywide
shall also provide the Corporation on a regular basis or upon reasonable request
the total number of shares which are authorized, issued and outstanding, but
shall have no obligation when recording the issuance of the Corporation's
shares, except as otherwise set forth herein, to monitor the issuance of such
shares or to take cognizance of any laws relating to the issue or sale of such
shares, which functions shall be the sole responsibility of the Corporation.
4. COUNTRYWIDE TO VALIDATE TRANSFERS.
----------------------------------
Upon receipt of a proper request for transfer from the
Corporation's distributor or dealer or a shareholder, Countrywide shall approve
such transfer and shall take all necessary steps to effectuate the transfer as
indicated in the transfer request. Upon approval of the transfer, Countrywide
shall notify the Corporation in writing of each such transaction and shall make
appropriate entries on the shareholder records maintained by Countrywide.
5. RECEIPT OF FUNDS.
-----------------
Upon receipt of any check or other instrument drawn or
endorsed to it as agent for, or identified as being for the account of, the
Corporation, Countrywide shall stamp the check or instrument with the date of
receipt, determine the amount thereof due the Corporation and shall forthwith
process the same for collection. Upon receipt of notification of receipt of
funds eligible for share purchases in accordance with the Corporation's then
current prospectus and statement of additional information, Countrywide shall
notify the Corporation, at the close of each business day, in writing of the
amount of said funds credited to the Corporation and deposited in its account
with the Custodian.
<PAGE>
6. PURCHASE ORDERS.
----------------
Upon receipt of an order for the purchase of shares of the
Corporation, accompanied by sufficient information to enable Countrywide to
establish a shareholder account, Countrywide shall, as of the next determination
of net asset value after receipt of such order in accordance with the
Corporation's then current prospectus and statement of additional information,
compute the number of shares of each Fund due to the shareholder pursuant to the
distributor's, dealer's or shareholder's instructions, credit the share account
of the shareholder, subject to collection of the funds, with the number of
shares so purchased, shall notify the Corporation in writing or by computer
report at the close of each business day of such transactions and shall mail to
the shareholder and/or dealer of record a notice of such credit when requested
to do so by the Corporation.
7. RETURNED CHECKS.
----------------
In the event that Countrywide is notified by the Corporation's
Custodian that any check or other order for the payment of money is returned
unpaid for any reason, Countrywide will:
A. Give prompt notification to the Corporation of the non-payment
of said check;
B. In the absence of other instructions from the Corporation,
take such steps as may be necessary to redeem any shares purchased on the basis
of such returned check and cause the proceeds of such redemption plus any
dividends declared with respect to such shares to be credited to the account of
the Corporation and to request the Corporation's Custodian to forward such
returned check to the person who originally submitted the check; and
C. Notify the Corporation of such actions and correct the
Corporation's records maintained by Countrywide pursuant to this Agreement.
8. DIVIDENDS AND DISTRIBUTIONS.
----------------------------
The Corporation shall furnish Countrywide with appropriate
evidence of Director action authorizing the declaration of dividends and other
distributions. Countrywide shall establish procedures in accordance with the
Corporation's then current prospectus and statement of additional information
and with other authorized actions of the Corporation's Board of Directors under
which it will have available from the Custodian or the Corporation any required
information for each dividend and other distribution. After deducting any amount
required to be withheld by any applicable laws, Countrywide shall, as agent for
<PAGE>
each shareholder who so requests, invest the dividends and other distributions
in full and fractional shares in accordance with the Corporation's then current
prospectus and statement of additional information. If a shareholder has elected
to receive dividends or other distributions in cash, then Countrywide shall
disburse dividends to shareholders of record in accordance with the
Corporation's then current prospectus and statement of additional information.
Countrywide shall, on or before the mailing date of such checks, notify the
Corporation and the Custodian of the estimated amount of cash required to pay
such dividend or distribution, and the Corporation shall instruct the Custodian
to make available sufficient funds therefor in the appropriate account of the
Corporation. Countrywide shall mail to the shareholders periodic statements, as
requested by the Corporation, showing the number of full and fractional shares
and the net asset value per share of shares so credited. When requested by the
Corporation, Countrywide shall prepare and file with the Internal Revenue
Service, and when required, shall address and mail to shareholders, such returns
and information relating to dividends and distributions paid by the Corporation
as are required to be so prepared, filed and mailed by applicable laws, rules
and regulations.
9. UNCLAIMED DIVIDENDS AND UNCLAIMED REDEMPTION PROCEEDS.
------------------------------------------------------
Countrywide shall, at least annually, furnish in writing to
the Corporation the names and addresses, as shown in the shareholder accounts
maintained by Countrywide, of all shareholders for which there are, as of the
end of the calendar year, dividends, distributions or redemption proceeds for
which checks or share certificates mailed in payment of distributions have been
returned. Countrywide shall use its best efforts to contact the shareholders
affected and to follow any other written instructions received from the
Corporation concerning the disposition of any such unclaimed dividends,
distributions or redemption proceeds.
<PAGE>
10. REDEMPTIONS AND EXCHANGES.
--------------------------
A. Countrywide shall process, in accordance with the Corporation's then
current prospectus and statement of additional information, each order for the
redemption of shares accepted by Countrywide. Upon its approval of such
redemption transactions, Countrywide, if requested by the Corporation, shall
mail to the shareholder and/or dealer of record a confirmation showing trade
date, number of full and fractional shares redeemed, the price per share and the
total redemption proceeds. For each such redemption, Countrywide shall either:
(a) prepare checks in the appropriate amounts for approval and verification by
the Corporation and signature by an authorized officer of Countrywide and mail
the checks to the appropriate person, or (b) in the event redemption proceeds
are to be wired through the Federal Reserve Wire System or by bank wire, cause
such proceeds to be wired in federal funds to the bank account designated by the
shareholder, or (c) effectuate such other redemption procedures, including
redemptions in kind, which are authorized by the Corporation's Board of
Directors or its then current prospectus and statement of additional
information. The requirements as to instruments of transfer and other
documentation, the applicable redemption price and the time of payment shall be
as provided in the then current prospectus and statement of additional
information, subject to such supplemental instructions as may be furnished by
the Corporation and accepted by Countrywide. If Countrywide or the Corporation
determines that a request for redemption does not comply with the requirements
for redemptions, Countrywide shall promptly notify the shareholder indicating
the reason therefor.
B. If shares of a Fund are eligible for exchange with shares of any
other Fund or investment company, Countrywide, in accordance with the then
current prospectus and statement of additional information and exchange rules of
the Corporation and such other investment company, or such other investment
company's transfer agent, shall review and approve all exchange requests and
shall, on behalf of the Corporation's shareholders, process such approved
exchange requests.
C. Countrywide shall notify the Corporation and the Custodian on each
business day of the amount of cash required to meet payments made pursuant to
the provisions of this Paragraph 10, and, on the basis of such notice, the
Corporation shall instruct the Custodian to make available from time to time
sufficient funds therefor in the appropriate account of the Corporation.
Procedures for effecting redemption orders accepted from shareholders or dealers
of record by telephone or other methods shall be established by mutual agreement
between Countrywide and the Corporation consistent with the Corporation's then
current prospectus and statement of additional information.
<PAGE>
D. The authority of Countrywide to perform its responsibilities under
Paragraph 6, Paragraph 8, and this Paragraph 10 shall be suspended with respect
to any Fund upon receipt of notification by it of the suspension of the
determination of such series' net asset value.
11. AUTOMATIC WITHDRAWAL PLANS.
---------------------------
Countrywide will process automatic withdrawal orders pursuant
to the provisions of the withdrawal plans duly executed by shareholders and the
current prospectus and statement of additional information of the Corporation.
Payments upon such withdrawal order shall be made by Countrywide from the
appropriate account maintained by the Corporation with the Custodian on
approximately the last business day of each month in which a payment has been
requested, and Countrywide will withdraw from a shareholder's account and
present for repurchase or redemption as many shares as shall be sufficient to
make such withdrawal payment pursuant to the provisions of the shareholder's
withdrawal plan and the current prospectus and statement of additional
information of the Corporation. From time to time on new automatic withdrawal
plans a check for a payment date already past may be issued upon request by the
shareholder.
12. WIRE-ORDER PURCHASES.
---------------------
Countrywide will send written confirmations to the dealers of
record containing all details of the wire-order purchases placed by each such
dealer by the close of business on the business day following receipt of such
orders by Countrywide. Upon receipt of any check drawn or endorsed to the
Corporation (or Countrywide, as agent) or otherwise identified as being payment
of an outstanding wire-order, Countrywide will stamp said check with the date of
its receipt and deposit the amount represented by such check to Countrywide's
deposit accounts maintained with the Custodian. Countrywide will cause the
Custodian to transfer federal funds in an amount equal to the net asset value of
the shares so purchased to the Corporation's account with the Custodian and will
notify the Corporation before noon (Eastern Time) of each business day of the
total amount deposited in the Corporation's deposit accounts, and in the event
that payment for a purchase order is not received by Countrywide or the
Custodian on the tenth business day following receipt of the order, prepare an
NASD "notice of failure of dealer to make payment."
13. OTHER PLANS.
------------
<PAGE>
Countrywide will process such accumulation plans, group
programs and other plans or programs for investing in shares of the Corporation
as are now, or in the future may be, provided for in the Corporation's then
current prospectus and statement of additional information and will act as plan
agent for shareholders pursuant to the terms of such plans and programs duly
executed by such shareholders.
14. RECORDKEEPING AND OTHER INFORMATION.
------------------------------------
Countrywide shall create and maintain all records required by
applicable laws, rules and regulations, including but not limited to records
required by Section 31(a) of the 1940 Act and the rules thereunder, as the same
may be amended from time to time, pertaining to the various functions performed
by it and not otherwise created and maintained by another party pursuant to
contract with the Corporation. All such records shall be the property of the
Corporation at all times and shall be available for inspection and use by the
Corporation. Where applicable, such records shall be maintained by Countrywide
for the periods and in the places required by Rule 31a-2 under the 1940 Act. The
retention of such records shall be at the expense of the Corporation.
Countrywide shall make available during regular business hours all records and
other data created and maintained pursuant to this Agreement for reasonable
audit and inspection by the Corporation, any person retained by the Corporation,
or any regulatory agency having authority over the Corporation. Countrywide
agrees to keep confidential all records and other information relative to the
Corporation and its shareholders, except when requested to divulge such
information by duly-constituted authorities or court process, or requested by a
shareholder with respect to information concerning an account as to which such
shareholder has either a legal or beneficial interest or when requested by the
Corporation, the shareholder, or the dealer of record as to such account.
15. SHAREHOLDER RECORDS.
--------------------
Countrywide shall maintain records for each shareholder
account showing the following:
A. Names, addresses and tax identifying numbers;
B. Name of the dealer of record, if any;
C. Number of shares held of each series;
D. Historical information regarding the account of each
shareholder, including dividends and distributions in cash or
invested in shares;
E. Information with respect to the source of all dividends and
distributions allocated among income, realized short-term
gains and realized long-term gains;
<PAGE>
F. Any instructions from a shareholder including all forms
furnished by the Corporation and executed by a shareholder
with respect to (i) dividend or distribution elections and
(ii) elections with respect to payment options in connection
with the redemption of shares;
G. Any correspondence relating to the current maintenance of a
shareholder's account;
H. Certificate numbers and denominations for any shareholder
holding certificates;
I. Any stop or restraining order placed against a shareholder's
account;
J. Information with respect to withholding in the case of a
foreign account or any other account for which withholding is
required by the Internal Revenue Code of 1986, as amended; and
K. Any information required in order for Countrywide to perform
the calculations contemplated under this Agreement.
16. TAX RETURNS AND REPORTS.
------------------------
Countrywide will prepare in the appropriate form, file with
the Internal Revenue Service and appropriate state agencies and, if required,
mail to shareholders of the Corporation such returns for reporting dividends and
distributions paid by the Corporation as are required to be so prepared, filed
and mailed and shall withhold such sums as are required to be withheld under
applicable federal and state income tax laws, rules and regulations.
17. OTHER INFORMATION TO THE CORPORATION.
-------------------------------------
Subject to such instructions, verification and approval of the
Custodian and the Corporation as shall be required by any agreement or
applicable law, Countrywide will also maintain such records as shall be
necessary to furnish to the Corporation the following: annual shareholder
meeting lists, proxy lists and mailing materials, shareholder reports and
confirmations and checks for disbursing redemption proceeds, dividends and other
distributions or expense disbursements.
18. ACCESS TO SHAREHOLDER INFORMATION.
----------------------------------
Upon request, Countrywide shall arrange for the Corporation's
investment adviser to have direct access to shareholder information contained in
Countrywide's computer system, including account balances, performance
information and such other information which is available to Countrywide with
respect to shareholder accounts.
<PAGE>
19. COOPERATION WITH ACCOUNTANTS.
-----------------------------
Countrywide shall cooperate with the Corporation's independent
public accountants and shall take all reasonable action in the performance of
its obligations under this Agreement to assure that the necessary information is
made available to such accountants for the expression of their unqualified
opinion where required for any document for the Corporation.
20. SHAREHOLDER SERVICE AND CORRESPONDENCE.
---------------------------------------
Countrywide will provide and maintain adequate personnel,
records and equipment to receive and answer all shareholder and dealer inquiries
relating to account status, share purchases, redemptions and exchanges and other
investment plans available to Corporation shareholders. Countrywide will answer
written correspondence from shareholders relating to their share accounts and
such other written or oral inquiries as may from time to time be mutually agreed
upon, and Countrywide will notify the Corporation of any correspondence or
inquiries which may require an answer from the Corporation.
21. PROXIES.
--------
Countrywide shall assist the Corporation in the mailing of
proxy cards and other material in connection with shareholder meetings of the
Corporation, shall receive, examine and tabulate returned proxies and shall, if
requested by the Corporation, provide at least one inspector of election to
attend and participate as required by law in shareholder meetings of the
Corporation.
22. FURTHER ACTIONS.
----------------
Each party agrees to perform such further acts and execute
such further documents as are necessary to effectuate the purposes hereof.
23. COMPENSATION.
-------------
For the performance of Countrywide's obligations under this
Agreement, each Fund shall pay Countrywide, on the first business day following
the end of each month, a monthly fee in accordance with the schedule attached
hereto as Schedule A. Countrywide shall not be required to reimburse the Fund or
the Fund's investment adviser for (or have deducted from its fees) any expenses
in excess of expense limitations imposed by certain state securities commissions
having jurisdiction over the Fund. The Corporation shall promptly reimburse
Countrywide for any out-of-pocket expenses and advances which are to be paid by
the Corporation in accordance with Paragraph 24.
<PAGE>
24. EXPENSES.
---------
Countrywide shall furnish, at its expense and without cost to
the Corporation (i) the services of its personnel to the extent that such
services are required to carry out its obligations under this Agreement and (ii)
use of data processing equipment. All costs and expenses not expressly assumed
by Countrywide under this Paragraph 24 shall be paid by the Corporation,
including, but not limited to, costs and expenses of officers and employees of
Countrywide in attending meetings of the Board of Directors and shareholders of
the Corporation, as well as costs and expenses for postage, envelopes, checks,
drafts, continuous forms, reports, communications, statements and other
materials, telephone, telegraph and remote transmission lines, use of outside
mailing firms, necessary outside record storage, media for storage of records
(e.g., microfilm, microfiche, computer tapes), printing, confirmations and any
other shareholder correspondence and any and all assessments, taxes or levies
assessed on Countrywide for services provided under this Agreement. Postage for
mailings of dividends, proxies, reports and other mailings to all shareholders
shall be advanced to Countrywide three business days prior to the mailing date
of such materials.
25. REPRESENTATIONS OF THE CORPORATION.
-----------------------------------
The Corporation certifies to Countrywide that: (1) as of the
close of business on the effective date of this Agreement, each Fund has
authorized ________ million shares, and (2) by virtue of its Articles of
Incorporation, shares of each Fund which are redeemed by the Corporation may be
sold by the Corporation from its treasury, and (3) this Agreement has been duly
authorized by the Corporation and, when executed and delivered by the
Corporation, will constitute a legal, valid and binding obligation of the
Corporation, enforceable against the Corporation in accordance with its terms,
subject to bankruptcy, insolvency, reorganization, moratorium and other laws of
general application affecting the rights and remedies of creditors and secured
parties.
26. REPRESENTATIONS OF COUNTRYWIDE.
-------------------------------
Countrywide represents and warrants that the various
procedures and systems which Countrywide has implemented with regard to
safeguarding from loss or damage attributable to fire, theft, or any other cause
of the blank checks, records, and other data of the Corporation and
Countrywide's records, data, equipment facilities and other property used in the
performance of its obligations hereunder are adequate and that it will make such
changes therein from time to time as are required for the secure performance of
its obligations hereunder.
<PAGE>
27. INSURANCE.
----------
Countrywide will use reasonable efforts to obtain insurance
covering the services to be performed by it under this Agreement and shall
notify the Corporation in the event it is unable to do so within 90 days after
the effective date of this Agreement. Thereafter, Countrywide will notify the
Corporation should any of its insurance coverage be changed for any reason. Such
notification shall include the date of change and reasons therefor. Countrywide
will notify the Corporation of any material claims against it with respect to
services performed under this Agreement, whether or not they may be covered by
insurance and shall notify the Corporation from time to time as may be
appropriate of the total outstanding claims made by Countrywide under its
insurance coverage.
28. COMPLIANCE WITH GOVERNMENTAL RULES AND REGULATIONS.
---------------------------------------------------
The parties hereto acknowledge and agree that nothing
contained herein shall be construed to require Countrywide to perform any
services for the Corporation which services could cause Countrywide to be deemed
an "investment adviser" of the Corporation within the meaning of Section
2(a)(20) of the 1940 Act or to supersede or contravene the Corporation's
prospectus or statement of additional information or any provisions of the 1940
Act and the rules thereunder. Except as otherwise provided in this Agreement and
except for the accuracy of information furnished to it by Countrywide, the
Corporation assumes full responsibility for complying with all applicable
requirements of the 1940 Act, the Securities Act of 1933, as amended, and any
other laws, rules and regulations of governmental authorities having
jurisdiction.
29. REFERENCES TO COUNTRYWIDE.
--------------------------
The Corporation shall not circulate any printed matter which
contains any reference to Countrywide without the prior written approval of
Countrywide, excepting solely such printed matter as merely identifies
Countrywide as Transfer, Shareholder Servicing and Dividend Disbursing Agent and
Accounting Services Agent. The Corporation will submit printed matter requiring
approval to Countrywide in draft form, allowing sufficient time for review by
Countrywide and its counsel prior to any deadline for printing.
30. EQUIPMENT FAILURES.
-------------------
<PAGE>
Countrywide shall take all steps necessary to minimize or
avoid service interruptions, and has entered into one or more agreements making
provision for emergency use of electronic data processing equipment. Countrywide
shall have no liability with respect to equipment failures beyond its control.
31. INDEMNIFICATION OF COUNTRYWIDE.
-------------------------------
A. Countrywide may rely on information reasonably believed by it to be
accurate and reliable. Except as may otherwise be required by the 1940 Act and
the rules thereunder, neither Countrywide nor its shareholders, officers,
directors, employees, agents, control persons or affiliates of any thereof shall
be subject to any liability for, or any damages, expenses or losses incurred by
the Corporation in connection with any error of judgment, mistake of law, any
act or omission connected with or arising out of any services rendered under or
payments made pursuant to this Agreement or any other matter to which this
Agreement relates, except by reason of willful misfeasance, bad faith or gross
negligence on the part of any such persons in the performance of the duties of
Countrywide under this Agreement or by reason of reckless disregard by any of
such persons of the obligations and duties of Countrywide under this Agreement.
B. Any person, even though also a director, officer, employee,
shareholder or agent of Countrywide, or any of its affiliates, who may be or
become an officer, director, employee or agent of the Corporation, shall be
deemed, when rendering services to the Corporation or acting on any business of
the Corporation, to be rendering such services to or acting solely as an
officer, director, employee or agent of the Corporation and not as a director,
officer, employee, shareholder or agent of or one under the control or direction
of Countrywide or any of its affiliates, even though paid by one of these
entities.
C. The Corporation shall indemnify and hold harmless Countrywide, its
directors, officers, employees, shareholders, agents, control persons and
affiliates from and against any and all claims, demands, expenses and
liabilities (whether with or without basis in fact or law) of any and every
nature which Countrywide may sustain or incur or which may be asserted against
Countrywide by any person by reason of, or as a result of: (i) any action taken
or omitted to be taken by Countrywide in good faith in reliance upon any
certificate, instrument, order or share certificate reasonably believed by it to
be genuine and to be signed, countersigned or executed by any duly authorized
person, upon the oral instructions or written instructions of an authorized
person of the Corporation or upon the opinion of legal counsel for the
Corporation or its own counsel; or (ii) any action taken or omitted to be taken
by Countrywide in connection with its appointment in good faith in reliance upon
any law, act, regulation or interpretation of the same even though the same may
thereafter have been altered, changed, amended or repealed. However,
indemnification under this subparagraph shall not apply to actions or omissions
of Countrywide or its directors, officers, employees, shareholders or agents in
cases of its or their own gross negligence, willful misconduct, bad faith, or
reckless disregard of its or their own duties hereunder.
<PAGE>
D. If a claim is made against Countrywide as to which Countrywide may
seek indemnity under this Section, Countrywide shall notify the Corporation
promptly after any written assertion of such claim threatening to institute an
action or proceeding with respect thereto and shall notify the Corporation
promptly of any action commenced against Countrywide within ten (10) days after
Countrywide shall have been served with a summons or other legal process, giving
information as to the nature and basis of the claim. Failure to so notify the
Corporation shall not, however, relieve the Corporation from any liability which
it may have on account of the indemnity under this Section if the Corporation
has not been prejudiced in any material respect by such failure. Countrywide
shall cooperate in the control of the defense of any action, suit or proceeding
in which Countrywide is involved and for which indemnity is being provided by
the Corporation to Countrywide. The Corporation may negotiate the settlement of
any action, suit or proceeding subject to Countrywide's approval, which shall
not be unreasonably withheld. Countrywide shall have the right, but not the
obligation, to participate in the defense or settlement of a claim or action,
with its own counsel, but any costs or expenses incurred by Countrywide in
connection with, or as a result of, such participation will be borne solely by
Countrywide.
<PAGE>
32. INDEMNIFICATION OF THE CORPORATION
----------------------------------
A. Countrywide shall indemnify any hold harmless the Corporation, each
Fund, and the Corporation's officers, directors, employees, shareholders,
agents, control persons and affiliates from and against any and all claims,
demands, expenses and liabilities (whether with or without basis in fact or law)
of any and every nature which the Corporation may sustain or incur or which may
be asserted against the Corporation by any person by reason of, or as a result
of, the gross negligence, willful misconduct, or bad faith of Countrywide, or
its directors, officers, employees, shareholders, agents, control persons or
affiliates in taking any action or omitting to take any action under this
Agreement or the reckless disregard of their duties thereunder.
B. If a claim is made against the Corporation as to which the
Corporation may seek indemnity under this Section, the Corporation shall notify
Countrywide promptly after any written assertion of such claim threatening to
institute an action or proceeding with respect thereto and shall notify
Countrywide promptly of any action commenced against the Corporation within ten
(10) days after the Corporation shall have been served with a summons or other
legal process, giving information as to the nature and basis of the claim.
Failure to so notify Countrywide shall not, however, relieve Countrywide from
any liability which it may have on account of the indemnity under this Section
if Countrywide has not been prejudiced in any material respect by such failure.
The Corporation shall cooperate in the control of the defense of any action,
suit or proceeding in which Countrywide is involved and for which indemnity is
being provided by Countrywide to the Corporation. Countrywide may negotiate the
settlement of any action, suite or proceeding subject to the Corporation's
approval, which shall not be unreasonably withheld. The Corporation shall have
the right, but not the obligation, to participate in the defense or settlement
of a claim or action, with its own counsel, but any costs or expenses incurred
by the Corporation in connection with, or as a result of, such participation
will be borne solely by the Corporation.
33. TERMINATION
-----------
A. The provisions of this Agreement shall be effective on the date
first above written and shall continue in effect for an initial term of one year
from that date. Thereafter, this Agreement shall continue in effect until
terminated by either party.
B. Either party may terminate this Agreement on any date by giving the
other party at least sixty (60) days' prior written notice of such termination
specifying the date fixed therefore. Upon termination of this Agreement, the
Corporation shall pay to Countrywide such compensation as may be due as of the
date of such termination, and shall likewise reimburse Countrywide for any
out-of-pocket expenses and disbursements reasonably incurred by Countrywide to
such date.
<PAGE>
C. In the event that in connection with the termination of this
Agreement a successor to any of Countrywide's duties or responsibilities under
this Agreement is designated by the Corporation by written notice to
Countrywide, Countrywide shall, promptly upon such termination and at the
expense of the Corporation, transfer all records maintained by Countrywide under
this Agreement and shall cooperate in the transfer of such duties and
responsibilities, including providing for assistance from Countrywide's
cognizant personnel in the establishment of books, records and other data by
such successor.
34. SERVICES FOR OTHERS.
--------------------
Nothing in this Agreement shall prevent Countrywide or any
affiliated person (as defined in the 1940 Act) of Countrywide from providing
services for any other person, firm or corporation (including other investment
companies); provided, however, that Countrywide expressly represents that it
will undertake no activities which, in its judgment, will adversely affect the
performance of its obligations to the Corporation under this Agreement.
35. LIMITATION OF LIABILITY.
------------------------
It is expressly agreed that the obligations of the Corporation
hereunder shall not be binding upon any of the Directors, shareholders,
nominees, officers, agents or employees of the Corporation, personally, but bind
only the property of the Corporation. The execution and delivery of this
Agreement have been authorized by the Directors of the Corporation and signed by
an officer of the Corporation, acting as such, and neither such authorization by
such Directors nor such execution and delivery by such officer shall be deemed
to have been made by any of them individually or to impose any liability on any
of them personally, but shall bind only the property of the Corporation.
36. SEVERABILITY.
-------------
In the event any provision of this Agreement is determined to
be void or unenforceable, such determination shall not affect the remainder of
this Agreement, which shall continue to be in force.
37. QUESTIONS OF INTERPRETATION.
----------------------------
This Agreement shall be governed by the laws of the State of
Ohio. Any question of interpretation of any term or provision of this Agreement
having a counterpart in or otherwise derived from a term or provision of the
1940 Act shall be resolved by reference to such term or provision of the 1940
Act and to interpretations thereof, if any, by the United States Courts or in
the absence of any controlling decision of any such court, by rules, regulations
or orders of the SEC issued pursuant to said 1940 Act. In addition, where the
effect of a requirement of the 1940 Act, reflected in any provision of this
Agreement, is revised by rule, regulation or order of the SEC, such provision
shall be deemed to incorporate the effect of such rule, regulation or order.
<PAGE>
38. NOTICES.
--------
All notices, requests, consents and other communications
required or permitted under this Agreement shall be in writing (including telex
and telegraphic communication) and shall be (as elected by the person giving
such notice) hand delivered by messenger or courier service, telecommunicated,
or mailed (airmail if international) by registered or certified mail (postage
prepaid), return receipt requested, addressed to:
To the Corporation: Fleming Capital Mutual Fund Group, Inc.
c/o Wadsworth Group
2025 East Financial Way, Suite 101
Glendora, California 91741
Attention: Emmy Butts
To Countrywide: Countrywide Fund Services, Inc.
312 Walnut Street, 21st Floor
Cincinnati, Ohio 45202
Attention: Robert G. Dorsey
or to such other address as any party may designate by notice complying with the
terms of this Section 38. Each such notice shall be deemed delivered (a) on the
date delivered if by personal delivery; (b) on the date telecommunicated if by
telegraph; (c) on the date of transmission with confirmed answer back if by
telex, telefax or other telegraphic method; and (d) on the date upon which the
return receipt is signed or delivery is refused or the notice is designated by
the postal authorities as not deliverable, as the case may be, if mailed.
39. AMENDMENT.
----------
This Agreement may not be amended or modified except by a
written agreement executed by both parties.
40. BINDING EFFECT.
---------------
Each of the undersigned expressly warrants and represents that
he has the full power and authority to sign this Agreement on behalf of the
party indicated, and that his signature will operate to bind the party indicated
to the foregoing terms.
<PAGE>
41. COUNTERPARTS.
-------------
This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
42. FORCE MAJEURE.
--------------
If Countrywide shall be delayed in its performance of services
or prevented entirely or in part from performing services due to causes or
events beyond its control, including and without limitation, acts of God,
interruption of power or other utility, transportation or communication
services, acts of civil or military authority, sabotages, national emergencies,
explosion, flood, accident, earthquake or other catastrophe, fire, strike or
other labor problems, legal action, present or future law, governmental order,
rule or regulation, or shortages of suitable parts, materials, labor or
transportation, such delay or non-performance shall be excused and a reasonable
time for performance in connection with this Agreement shall be extended to
include the period of such delay or non-performance.
43. MISCELLANEOUS.
--------------
The captions in this Agreement are included for convenience of
reference only and in no way define or limit any of the provisions hereof or
otherwise affect their construction or effect. This Agreement and the rights and
duties hereunder shall not be assignable with respect to a Fund by either party
except with the prior written consent of the other party.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and year first above written.
FLEMING CAPITAL MUTUAL FUND GROUP, INC.
By: /s/ Jonathan K.L. Simon
---------------------------
Its: President
COUNTRYWIDE FUND SERVICES, INC.
By: /s/ Robert A. Dorsey
-------------------------
Its: President
<PAGE>
Schedule A
----------
COMPENSATION
------------
Services FEE
- -------- ---
(Per Account)
As Transfer, Dividend Disbursing,
Shareholder Service and Plan Agent:
Fleming Fund Payable monthly at
rate of
$17.00/year
Fleming Fledgling Fund Payable monthly at
rate of
$17.00/year
Each Fund will be subject to a minimum charge of $1,000 per month.
Exhibit 99.B9(c)
ACCOUNTING SERVICES AGREEMENT
-----------------------------
AGREEMENT dated as of September 30, 1997 between Fleming Capital Mutual
Fund Group, Inc. (the "Corporation"), a Maryland corporation, and Countrywide
Fund Services, Inc. ("Countrywide"), an Ohio corporation.
WHEREAS, the Corporation is an investment company registered under the
Investment Company Act of 1940, as amended (the "1940 Act"); and
WHEREAS, the Corporation wishes to employ the services of Countrywide
to provide the Corporation with certain accounting and pricing services with
respect to the Corporation and each series identified on Schedule A (each, a
"Fund" and collectively, the "Funds"), which may be amended by agreement of the
parties from time to time; and
WHEREAS, Countrywide wishes to provide such services under the
conditions set forth below;
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained in this Agreement, the Corporation and Countrywide agree as follows:
1. APPOINTMENT.
------------
The Corporation hereby appoints and employs Countrywide as
agent to perform those services described in this Agreement for the Corporation.
Countrywide shall act under such appointment and perform the obligations thereof
upon the terms and conditions hereinafter set forth.
2. CALCULATION OF NET ASSET VALUE.
-------------------------------
Countrywide will calculate the net asset value of each Fund
and the per share net asset value of each Fund, in accordance with the current
prospectus and statement of additional information of each Fund, once daily as
of the time selected by the Corporation's Board of Directors. Countrywide will
prepare and maintain a daily valuation of all securities and other assets of the
Corporation in accordance with instructions from a designated officer of the
Corporation or its investment adviser and in the manner set forth in the
Corporation's current prospectus and statement of additional information. In
valuing securities of the Corporation, Countrywide may contract with, and rely
upon market quotations provided by, outside services.
<PAGE>
3. PAYMENT OF EXPENSES.
--------------------
Countrywide shall process each request received from the
Corporation or its authorized agents for payment of the Corporation's expenses.
Upon receipt of written instructions signed by an officer or other authorized
agent of the Corporation, Countrywide shall prepare checks in the appropriate
amounts which shall be signed by an authorized officer of Countrywide and mailed
to the appropriate party.
4. FORM N-SAR.
-----------
Countrywide shall maintain such records within its control and
shall be requested by the Corporation to assist the Corporation in fulfilling
the requirements of Form N-SAR.
5. BOOKS AND RECORDS.
------------------
Countrywide will maintain and keep current the general ledger
for each Fund, recording all income and expenses, capital share activity and
security transactions of the Funds. Countrywide will maintain such further books
and records as are necessary to enable it to perform its duties under this
Agreement, and will periodically provide reports to the Corporation and its
authorized agents regarding share purchases and redemptions and trial balances
of each Fund. Countrywide will prepare and maintain complete, accurate and
current all records with respect to the Funds required to be maintained by the
Corporation under the Internal Revenue Code of 1986, as amended (the "Code"),
and under the rules and regulations of the 1940 Act, and will preserve said
records in the manner and for the periods prescribed in the Code and the 1940
Act.
All of the records prepared and maintained by Countrywide pursuant to
this Agreement which are required to be maintained by the Corporation under the
Code and the 1940 Act will be the property of the Corporation. In the event this
Agreement is terminated, all such records shall be delivered to the Corporation
at the Corporation's expense, and Countrywide shall be relieved of
responsibility for the preparation and maintenance of any such records delivered
to the Corporation.
The records that Countrywide will create and maintain and the daily,
monthly, and annual (or semiannual) services that will be provided by
Countrywide are set forth on Schedule B.
6. COOPERATION WITH ACCOUNTANTS.
-----------------------------
Countrywide shall cooperate with the Corporation's independent
public accountants and shall take all reasonable action in the performance of
its obligations under this Agreement to assure that the necessary information is
made available to such accountants for the expression of their unqualified
opinion where required for any document for the Corporation.
<PAGE>
7. FURTHER ACTIONS.
----------------
Each party agrees to perform such further acts and execute
such further documents as are necessary to effectuate the purposes hereof.
8. FEES.
-----
For the performance of the services under this Agreement, each
Fund shall pay Countrywide a monthly fee in accordance with the schedule
attached hereto as Schedule A. The fees with respect to any month shall be paid
to Countrywide on the last business day of such month. The Corporation shall
also promptly reimburse Countrywide for the cost of external pricing services
utilized by Countrywide. Countrywide shall not be required to reimburse the
Funds or the Funds' investment adviser for (or have deducted from its fees) any
expenses in excess of expense limitations imposed by certain state securities
commissions having jurisdiction over the Funds.
9. COMPLIANCE WITH GOVERNMENTAL RULES AND REGULATIONS.
---------------------------------------------------
The parties hereto acknowledge and agree that nothing
contained herein shall be construed to require Countrywide to perform any
services for the Corporation which services could cause Countrywide to be deemed
an "investment adviser" of the Corporation within the meaning of Section
2(a)(20) of the 1940 Act or to supersede or contravene the Corporation's
prospectus or statement of additional information or any provisions of the 1940
Act and the rules thereunder. Except as otherwise provided in this Agreement and
except for the accuracy of information furnished to it by Countrywide, the
Corporation assumes full responsibility for complying with all applicable
requirements of the 1940 Act, the Securities Act of 1933, as amended, and any
other laws, rules and regulations of governmental authorities having
jurisdiction.
10. REFERENCES TO COUNTRYWIDE.
--------------------------
The Corporation shall not circulate any printed matter which
contains any reference to Countrywide without the prior written approval of
Countrywide, excepting solely such printed matter as merely identifies
Countrywide as Transfer, Dividend Disbursing, Shareholder Service and Plan Agent
and Accounting Services Agent. The Corporation will submit printed matter
requiring approval to Countrywide in draft form, allowing sufficient time for
review by Countrywide and its counsel prior to any deadline for printing.
<PAGE>
11. EQUIPMENT FAILURES.
-------------------
Countrywide shall take all steps necessary to minimize or
avoid service interruptions, and has entered into one or more agreements making
provision for emergency use of electronic data processing equipment. Countrywide
shall have no liability with respect to equipment failures beyond its control.
12. INDEMNIFICATION OF COUNTRYWIDE.
-------------------------------
A. Countrywide may rely on information reasonably believed by it to be
accurate and reliable. Except as may otherwise be required by the 1940 Act and
the rules thereunder, neither Countrywide nor its shareholders, officers,
directors, employees, agents, control persons or affiliates of any thereof shall
be subject to any liability for, or any damages, expenses or losses incurred by
the Corporation in connection with any error of judgment, mistake of law, any
act or omission connected with or arising out of any services rendered under or
payments made pursuant to this Agreement or any other matter to which this
Agreement relates, except by reason of willful misfeasance, bad faith or gross
negligence on the part of any such persons in the performance of the duties of
Countrywide under this Agreement or by reason of reckless disregard by any of
such persons of the obligations and duties of Countrywide under this Agreement.
B. Any person, even though also a director, officer, employee,
shareholder, or agent of Countrywide, or any of its affiliates, who may be or
become an officer, director, employee or agent of the Corporation, shall be
deemed, when rendering services to the Corporation or acting on any business of
the Corporation, to be rendering such services to or acting solely as an
officer, director, employee or agent of the Corporation and not as a director,
officer, employee, shareholder or agent of or one under the control or direction
of Countrywide or any of its affiliates, even though paid by one of those
entities.
C. Notwithstanding any other provision of this Agreement, the
Corporation shall indemnify and hold harmless Countrywide, its directors,
officers, employees, shareholders, agents, control persons and affiliates from
and against any and all claims, demands, expenses and liabilities (whether with
or without basis in fact or law) of any and every nature which Countrywide may
sustain or incur or which may be asserted against Countrywide by any person by
reason of, or as a result of: (i) any action taken or omitted to be taken by
Countrywide in good faith in reliance upon any certificate, instrument, order or
share certificate reasonably believed by it to be genuine and to be signed,
countersigned or executed by any duly authorized person, upon the oral
instructions or written instructions of an authorized person of the Corporation
or upon the opinion of legal counsel for the Corporation or its own counsel; or
(ii) any action taken or omitted to be taken by Countrywide in connection with
its appointment in good faith in reliance upon any law, act, regulation or
interpretation of the same even though the same may thereafter have been
altered, changed, amended or repealed. However, indemnification under this
subparagraph shall not apply to actions or omissions of Countrywide or its
directors, officers, employees, shareholders or agents in cases of its or their
own gross negligence, willful misconduct, bad faith, or reckless disregard of
its or their own duties hereunder.
<PAGE>
D. If a claim is made against Countrywide as to which Countrywide may
seek indemnity under this Section, Countrywide shall notify the Corporation
promptly after any written assertion of such claim threatening to institute an
action or proceeding with respect thereto and shall notify the Corporation
promptly of any action commenced against Countrywide within ten (10) days after
Countrywide shall have been served with a summons or other legal process, giving
information as to the nature and basis of the claim. Failure to so notify the
Corporation shall not, however, relieve the Corporation from any liability which
it may have on account of the indemnity under this Section if the Corporation
has not been prejudiced in any material respect by such failure. Countrywide
shall cooperate in the control of the defense of any action, suit or proceeding
in which Countrywide is involved and for which indemnity is being provided by
the Corporation to Countrywide. The Corporation may negotiate the settlement of
any action, suit or proceeding subject to Countrywide's approval, which shall
not be unreasonably withheld. Countrywide shall have the right, but not the
obligation, to participate in the defense or settlement of a claim or action,
with its own counsel, but any costs or expenses incurred by Countrywide in
connection with, or as a result of, such participation will be borne solely by
Countrywide.
13. INDEMNIFICATION OF THE CORPORATION
----------------------------------
A. Countrywide shall indemnify any hold harmless the Corporation, each
Fund, and the Corporation's officers, directors, employees, shareholders,
agents, control persons and affiliates from and against any and all claims,
demands, expenses and liabilities (whether with or without basis in fact or law)
of any and every nature which the Corporation may sustain or incur or which may
be asserted against the Corporation by any person by reason of, or as a result
of, the gross negligence, willful misconduct, or bad faith of Countrywide, or
its directors, officers, employees, shareholders, agents, control persons or
affiliates in taking any action or omitting to take any action under this
Agreement or the reckless disregard of their duties thereunder.
<PAGE>
B. If a claim is made against the Corporation as to which the
Corporation may seek indemnity under this Section, the Corporation shall notify
Countrywide promptly after any written assertion of such claim threatening to
institute an action or proceeding with respect thereto and shall notify
Countrywide promptly of any action commenced against the Corporation within ten
(10) days after the Corporation shall have been served with a summons or other
legal process, giving information as to the nature and basis of the claim.
Failure to so notify Countrywide shall not, however, relieve Countrywide from
any liability which it may have on account of the indemnity under this Section
if Countrywide has not been prejudiced in any material respect by such failure.
The Corporation shall cooperate in the control of the defense of any action,
suit or proceeding in which Countrywide is involved and for which indemnity is
being provided by Countrywide to the Corporation. Countrywide may negotiate the
settlement of any action, suite or proceeding subject to the Corporation's
approval, which shall not be unreasonably withheld. The Corporation shall have
the right, but not the obligation, to participate in the defense or settlement
of a claim or action, with its own counsel, but any costs or expenses incurred
by the Corporation in connection with, or as a result of, such participation
will be borne solely by the Corporation.
14. TERMINATION.
------------
A. The provisions of this Agreement shall be effective on the date
first above written and shall continue in effect for an initial term of one year
from that date. Thereafter, this Agreement shall continue in effect until
terminated by either party.
B. Either party may terminate this Agreement on any date by giving the
other party at least sixty (60) days' prior written notice of such termination
specifying the date fixed therefore. Upon termination of this Agreement, the
Corporation shall pay to Countrywide such compensation as may be due as of the
date of such termination, and shall likewise reimburse Countrywide for any
out-of-pocket expenses and disbursements reasonably incurred by Countrywide to
such date.
C. In the event that in connection with the termination of this
Agreement a successor to any of Countrywide's duties or responsibilities under
this Agreement is designated by the Corporation by written notice to
Countrywide, Countrywide shall, promptly upon such termination and at the
expense of the Corporation, transfer all records maintained by Countrywide under
this Agreement and shall cooperate in the transfer of such duties and
responsibilities, including providing for assistance from Countrywide's
cognizant personnel in the establishment of books, records and other data by
such successor.
15. SERVICES FOR OTHERS.
--------------------
<PAGE>
Nothing in this Agreement shall prevent Countrywide or any
affiliated person (as defined in the 1940 Act) of Countrywide from providing
services for any other person, firm or corporation (including other investment
companies); provided, however, that Countrywide expressly represents that it
will undertake no activities which, in its judgment, will adversely affect the
performance of its obligations to the Corporation under this Agreement.
16. LIMITATION OF LIABILITY.
------------------------
It is expressly agreed that the obligations of the Corporation
hereunder shall not be binding upon any of the Directors, shareholders,
nominees, officers, agents or employees of the Corporation, personally, but bind
only the property of the Corporation. The execution and delivery of this
Agreement have been authorized by the Directors of the Corporation and signed by
an officer of the Corporation, acting as such, and neither such authorization by
such Directors nor such execution and delivery by such officer shall be deemed
to have been made by any of them individually or to impose any liability on any
of them personally, but shall bind only the property of the Corporation.
17. SEVERABILITY.
-------------
In the event any provision of this Agreement is determined to
be void or unenforceable, such determination shall not affect the remainder of
this Agreement, which shall continue to be in force.
18. QUESTIONS OF INTERPRETATION.
----------------------------
This Agreement shall be governed by the laws of the State of
Ohio. Any question of interpretation of any term or provision of this Agreement
having a counterpart in or otherwise derived from a term or provision of the
1940 Act shall be resolved by reference to such term or provision of the 1940
Act and to interpretations thereof, if any, by the United States Courts or in
the absence of any controlling decision of any such court, by rules, regulations
or orders of the Securities and Exchange Commission issued pursuant to said 1940
Act. In addition, where the effect of a requirement of the 1940 Act, reflected
in any provision of this Agreement, is revised by rule, regulation or order of
the Securities and Exchange Commission, such provision shall be deemed to
incorporate the effect of such rule, regulation or order.
19. NOTICES.
--------
All notices, requests, consents and other communications
required or permitted under this Agreement shall be in writing (including telex
and telegraphic communication) and shall be (as elected by the person giving
such notice) hand delivered by messenger or courier service, telecommunicated,
or mailed (airmail if international) by registered or certified mail (postage
prepaid), return receipt requested, addressed to:
<PAGE>
To the Trust: Fleming Capital Mutual Fund Group, Inc.
c/o Wadsworth Group
2025 East Financial Way, Suite 101
Glendora, California 91741
Attention: Emmy Butts
To Countrywide: Countrywide Fund Services, Inc.
312 Walnut Street, 21st Floor
Cincinnati, Ohio 45202
Attention: Robert G. Dorsey
or to such other address as any party may designate by notice complying with the
terms of this Section 19. Each such notice shall be deemed delivered (a) on the
date delivered if by personal delivery; (b) on the date telecommunicated if by
telegraph; (c) on the date of transmission with confirmed answer back if by
telex, telefax or other telegraphic method; and (d) on the date upon which the
return receipt is signed or delivery is refused or the notice is designated by
the postal authorities as not deliverable, as the case may be, if mailed.
20. AMENDMENT.
----------
This Agreement may not be amended or modified except by a
written agreement executed by both parties.
21. BINDING EFFECT.
---------------
Each of the undersigned expressly warrants and represents that
he has the full power and authority to sign this Agreement on behalf of the
party indicated, and that his signature will operate to bind the party indicated
to the foregoing terms.
22. COUNTERPARTS.
-------------
This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
23. FORCE MAJEURE.
--------------
If Countrywide shall be delayed in its performance of services
or prevented entirely or in part from performing services due to causes or
events beyond its control, including and without limitation, acts of God,
interruption of power or other utility, transportation or communication
services, acts of civil or military authority, sabotages, national emergencies,
explosion, flood, accident, earthquake or other catastrophe, fire, strike or
other labor problems, legal action, present or future law, governmental order,
rule or regulation, or shortages of suitable parts, materials, labor or
transportation, such delay or non-performance shall be excused and a reasonable
time for performance in connection with this Agreement shall be extended to
include the period of such delay or non-performance.
<PAGE>
24. MISCELLANEOUS.
--------------
The captions in this Agreement are included for convenience of
reference only and in no way define or limit any of the provisions hereof or
otherwise affect their construction or effect. This Agreement and the rights and
duties hereunder shall not be assignable with respect to a Fund by either party
except with the prior written consent of the other party.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and year first above written.
FLEMING CAPITAL MUTUAL FUND GROUP, INC.
By: /s/ Jonathan K.L. Simon
---------------------------
Its: President
COUNTRYWIDE FUND SERVICES, INC.
By: /s/ Robert A. Dorsey
------------------------
Its: President
<PAGE>
Schedule A
----------
COMPENSATION
------------
Fleming Fund
Fleming Fledgling Fund
Each Fund will pay Countrywide a monthly fee, according to the average
net assets of such series during such month, as follows:
Average Monthly Net Assets Monthly Fee
-------------------------- -----------
0 - $ 25,000,000 $1,500
25 - 50,000,000 2,000
50 - 100,000,000 2,500
100 - 200,000,000 3,000
Over 200,000,000 4,000 plus .001%
of such assets in
excess of $200,000,000
<PAGE>
Schedule B
----------
FUND ACCOUNTING SERVICES
------------------------
Required Records; Ledgers and Journals
--------------------------------------
Countrywide shall maintain and keep current the following accounts and
records relating to the business of the Fund, in such form as may be mutually
agreed to between the Fund and Countrywide:
1) Cash Receipts Journal
2) Cash Disbursements Journal
3) Dividends Paid and Payable Schedule
4) Purchase and Sales Journals - Portfolio Securities
5) Realized/Unrealized Gain (Loss) Reports
6) Subscription and Redemption Journals
7) Security Ledgers - Transaction Report and Tax Lot Holdings Report
8) Broker Ledger - Commission Report
9) Daily Expense Accruals
10) Daily Interest Accruals
11) Daily Trial Balance
12) Portfolio Interest Receivable and Income Journal
13) Portfolio Dividend Receivable and Income Register
14) Listing of Portfolio Holdings - showing cost, market value and
percentage of portfolio comprised of each security
Daily Accounting Services
-------------------------
1) Calculate Net Asset Value (and Offering Price) Per Share:
---------------------------------------------------------
- Update the daily market value of securities held by each Fund
- Where necessary, enter manual prices supplied by broker
- Prepare NAV proof sheet. Review components of change in NAV
for reasonableness
- Review variance reporting for price changes in individual
securities using variance levels established by Funds
- Review for ex-dividend items indicated by pricing sources;
trace to general ledger for agreement
- Communicate required pricing information (NAV/POP) to the
Corporation, Transfer Agent and, electronically, to NASDAQ
<PAGE>
2) Calculate Daily Dividend:
-------------------------
- Calculate net investment income available for distribution
daily
- Calculate daily dividend rate, and 1,7,30-day yields
- Verify dollar-weighted average maturity
3) Determine and Report Cash Availability:
---------------------------------------
- Receive daily cash and transaction statements from the
custodian
- Complete daily bank cash reconciliations (including
documentation of any reconciling items) and notify the Fund's
custodian
- Report investable cash to investment adviser (if any)
4) Reconcile All Daily Expense Accruals:
-------------------------------------
- Accrue expenses based on percentage of Fund's net assets or
specific dollar amounts provided by the administrator
- If applicable, accrue daily amortization of organization
expense
- If applicable, complete daily accrual of Rule 12b-1 Plan
expenses
5) Verify and Record All Daily Income Accruals for Debt Issues:
------------------------------------------------------------
- Review and verify all interest and amortization reports
- Establish security codes to permit income reporting
6) Monitor Domestic Securities:
----------------------------
- Monitor information electronically received for all domestic
securities
- Review current daily security trades for dividend activity
- Interface with the custodian for timely collection and
postings of corporate actions, dividends and
interest/pre-payments
7) Enter All Security Trades:
--------------------------
- Review verification of trade and interest calculations -
Verify settlement through custodian statements
- Maintain security ledger transaction reporting
- Maintain tax lot holdings
- Determine realized gains or losses on security trades
- Provide broker commission reporting
<PAGE>
8) Enter All Fund Shares Transactions:
-----------------------------------
- Process activity identified on transfer agent reports
- Verify settlement through custodian statements
- Reconcile to transfer agency report balances
9) Prepare Daily Trial Balance:
----------------------------
- Post manual entries to general ledger
- Post custodian bank activity
- Post shareholder and security transactions
- Post and verify income and expense accruals
- Prepare general ledger
10) Review and Reconcile Custodian Statements:
------------------------------------------
- Verify all posted interest, dividends, expenses, and
shareholder and security payments/receipts, etc.
- Post all cash settlement activity to trial balance and
reconcile to ending cash balance accounts
- Track status of past due items and failed grades with the
custodian
11) Preparation of Accounting Reports:
----------------------------------
- Trial Balance
- Portfolio Valuation
- NAV Calculation Report
- Cash Availability
Monthly Services
----------------
1) Submission of Monthly Accounting Reports
----------------------------------------
2) Reconcile Asset Listing to Custodian Asset Listing
--------------------------------------------------
3) Provide Monthly Analysis and Reconciliation of Trial Balance Accounts
---------------------------------------------------------------------
4) Prepare Documentation Supporting the Preparation of:
----------------------------------------------------
- SEC yield reporting
- Income by state reporting
- Standard Industry Code Valuation Report
- Alternative Minimum Tax income segregation schedule
Annual and (Semiannual) Accounting Services
-------------------------------------------
1) Supply auditors with schedules supporting securities and shareholder
transactions, income and expense accruals, etc. during the year in
accordance with standard audit assistance requirements
2) Provide Relevant N-SAR Reporting Information
EXHIBIT 99.16
SCHEDULE FOR COMPUTATION OF
PERFORMANCE QUOTATIONS OF THE
FLEMING CAPITAL MUTUAL FUND GROUP, INC.
TOTAL RETURN FORMULA
n
P(1+T) = ERV
Where: P = a hypothetical initial payment of $1,000
T = average annual total return
n = number of years
ERV = ending redeemable value of a hypothetical
$1,000 payment made at the beginning of the
1-, 5- or 10-year periods at the end of the
1-, 5- or 10-year periods (or fractional
portion thereof)
Fleming Fund
- ------------
For the period November 13, 1997(commencement of operations) to March 31, 1998:
0.17
$1,000(1+T) = $1,193 or total rate of 19.34%
Fleming Fledgling Fund
- ----------------------
For the period November 14, 1997 (commencement of operations) to March 31, 1998:
0.17
$1,000(1+T) = $1,162 or total rate of 16.18%
Exhibit- 99.B17
POWER OF ATTORNEY
-----------------
KNOW ALL BY THESE PRESENTS, that the person(s) whose signature appears
below constitutes and appoints Larry A. Kimmel, Arthur A. Levy, Clarissa Moore,
Eric M. Banhazl and Richard F. Jackson, and each of them individually, to act as
attorney-in-fact and agent, with power of substitution and resubstitution, for
the undersigned in any and all capacities to sign the Registration Statement of
Fleming Capital Mutual Fund Group, Inc., a Maryland Corporation, on Form N-1A
under the Securities Act of 1933, as amended and any or all amendments
(including post-effective amendments) thereto, and to file the same, with
exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorney-in-fact and
agent full power and authority to do and perform each and every act and thing
requisite or necessary to be done in and about the premises, as fully to all
intents and purposes as he or she might or could do in person, hereby ratifying
and conforming all that said attorney-in-fact, or any substitute or substitutes,
may do or cause to be done by virtue hereof.
Dated: April 14, 1998
/s/ Robert Marks
----------------------
Robert Marks
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL BY THESE PRESENTS, that the person(s) whose signature appears
below constitutes and appoints Larry A. Kimmel, Arthur A. Levy, Clarissa Moore,
Eric M. Banhazl and Richard F. Jackson, and each of them individually, to act as
attorney-in-fact and agent, with power of substitution and resubstitution, for
the undersigned in any and all capacities to sign the Registration Statement of
Fleming Capital Mutual Fund Group, Inc., a Maryland Corporation, on Form N-1A
under the Securities Act of 1933, as amended and any or all amendments
(including post-effective amendments) thereto, and to file the same, with
exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorney-in-fact and
agent full power and authority to do and perform each and every act and thing
requisite or necessary to be done in and about the premises, as fully to all
intents and purposes as he or she might or could do in person, hereby ratifying
and conforming all that said attorney-in-fact, or any substitute or substitutes,
may do or cause to be done by virtue hereof.
Dated: April 14, 1998
/s/ Michael A. Petrino
----------------------------
Michael A. Petrino
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL BY THESE PRESENTS, that the person(s) whose signature appears
below constitutes and appoints Larry A. Kimmel, Arthur A. Levy, Clarissa Moore,
Eric M. Banhazl and Richard F. Jackson, and each of them individually, to act as
attorney-in-fact and agent, with power of substitution and resubstitution, for
the undersigned in any and all capacities to sign the Registration Statement of
Fleming Capital Mutual Fund Group, Inc., a Maryland Corporation, on Form N-1A
under the Securities Act of 1933, as amended and any or all amendments
(including post-effective amendments) thereto, and to file the same, with
exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorney-in-fact and
agent full power and authority to do and perform each and every act and thing
requisite or necessary to be done in and about the premises, as fully to all
intents and purposes as he or she might or could do in person, hereby ratifying
and conforming all that said attorney-in-fact, or any substitute or substitutes,
may do or cause to be done by virtue hereof.
Dated: April 14, 1998
/s/ Dominic Solly
------------------------
Dominic Solly
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 1037897
<NAME> Fleming Capital Mutual Fund Group, Inc.
<SERIES>
<NUMBER> 1
<NAME> Fleming Fund
<MULTIPLIER> 1
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 4-MOS
<FISCAL-YEAR-END> SEP-30-1998
<PERIOD-START> NOV-13-1998
<PERIOD-END> MAR-31-1998
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 2,070,433
<INVESTMENTS-AT-VALUE> 2,320,326
<RECEIVABLES> 93,889
<ASSETS-OTHER> 153,687
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 2,567,902
<PAYABLE-FOR-SECURITIES> 188,208
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 24,930
<TOTAL-LIABILITIES> 213,138
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 2,044,825
<SHARES-COMMON-STOCK> 197,884
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 8,951
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 51,094
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 249,894
<NET-ASSETS> 2,354,764
<DIVIDEND-INCOME> 7,808
<INTEREST-INCOME> 8,657
<OTHER-INCOME> 0
<EXPENSES-NET> 7,514
<NET-INVESTMENT-INCOME> 8,951
<REALIZED-GAINS-CURRENT> 51,094
<APPREC-INCREASE-CURRENT> 249,894
<NET-CHANGE-FROM-OPS> 309,939
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 3,632
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 187,537
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 347
<NET-CHANGE-IN-ASSETS> 2,254,764
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 5,407
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 59,940
<AVERAGE-NET-ASSETS> 1,601,682
<PER-SHARE-NAV-BEGIN> 10.00
<PER-SHARE-NII> .08
<PER-SHARE-GAIN-APPREC> 1.85
<PER-SHARE-DIVIDEND> .03
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 11.90
<EXPENSE-RATIO> 1.25
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 1037897
<NAME> Fleming Capital Mutual Fund Group, Inc.
<SERIES>
<NUMBER> 2
<NAME> Fleming Fledgling Fund
<MULTIPLIER> 1
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 4-MOS
<FISCAL-YEAR-END> SEP-30-1998
<PERIOD-START> NOV-14-1998
<PERIOD-END> MAR-31-1998
<EXCHANGE-RATE> 1
<INVESTMENTS-AT-COST> 1,185,290
<INVESTMENTS-AT-VALUE> 1,327,951
<RECEIVABLES> 34,999
<ASSETS-OTHER> 49,750
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 1,412,700
<PAYABLE-FOR-SECURITIES> 33,872
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 23,450
<TOTAL-LIABILITIES> 57,322
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 1,175,455
<SHARES-COMMON-STOCK> 116,800
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 1,201
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 36,061
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 142,661
<NET-ASSETS> 1,355,378
<DIVIDEND-INCOME> 1,338
<INTEREST-INCOME> 5,350
<OTHER-INCOME> 0
<EXPENSES-NET> 5,488
<NET-INVESTMENT-INCOME> 1,200
<REALIZED-GAINS-CURRENT> 36,061
<APPREC-INCREASE-CURRENT> 142,661
<NET-CHANGE-FROM-OPS> 179,922
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 1,608
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 106,642
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 158
<NET-CHANGE-IN-ASSETS> 1,255,378
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 4,125
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 57,879
<AVERAGE-NET-ASSETS> 1,109,443
<PER-SHARE-NAV-BEGIN> 10.00
<PER-SHARE-NII> .03
<PER-SHARE-GAIN-APPREC> 1.59
<PER-SHARE-DIVIDEND> .02
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 11.60
<EXPENSE-RATIO> 1.35
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
