Exhibit 10.8
NEW ENGLAND ZENITH FUND
ADVISORY AGREEMENT
(Xxxxxxx Xxxxx Xxxxxx Value Series)
AGREEMENT made this first day of May, 1998 by and between NEW ENGLAND
ZENITH FUND, a Massachusetts business trust (the "Fund"), with respect to its
Xxxxxxx Sachs Midcap Value Series (the "Series"), and TNE ADVISERS, INC., a
Massachusetts corporation (the "Manager").
WITNESSETH:
WHEREAS, the Fund and the Manager wish to enter into an agreement setting
forth the terms upon which the Manager (or certain other parties acting pursuant
to delegation from the Manager) will perform certain services for the Series;
NOW THEREFORE, in consideration of the premises and covenants hereinafter
contained, the parties agree as follows:
1. (a) The Fund hereby employs the Manager to furnish the Fund with
Portfolio Management Services (as defined in Section 2 hereof) and
Administrative Services (as defined in Section 3 hereof), subject to the
authority of the Manager to delegate any or all of its responsibilities
hereunder to other parties as provided in Sections 1(b) and (c) hereof. The
Manager hereby accepts such employment and agrees, at its own expense, to
furnish such services (either directly or pursuant to delegation to other
parties as permitted by Sections 1(b) and (c) hereof) and to assume the
obligations herein set forth, for the compensation herein provided. The Manager
shall, unless otherwise expressly provided or authorized, have no authority to
act for or represent the Fund in any way or otherwise be deemed an agent of the
Fund.
(b) The Manager may delegate any or all of its responsibilities
hereunder with respect to the provision of Portfolio Management Services (and
assumption of related expenses) to one or more other parties (each such party, a
"Sub-Adviser"), pursuant in each case to a written agreement with such Sub-
Adviser that meets the requirements of Section 15 of the Investment Company Act
of 1940 and the rules thereunder (the "1940 Act") applicable to contracts for
service as investment adviser of a registered investment company (including
without limitation the requirements for approval by the trustees of the Fund and
the shareholders of the Series), subject, however, to such exemptions as may be
granted by the Securities and Exchange Commission. Any Sub-Adviser may (but need
not) be affiliated with the Manager. If different Sub-Advisers are engaged to
provide Portfolio Management Services with respect to different segments of the
portfolio of the Series, the Manager shall determine, in the manner described in
the prospectus of the Series from time to time in effect, what portion of the
assets belonging to the Series shall be managed by each Sub-Adviser.
(c) The Manager may delegate any or all of its responsibilities
hereunder with respect to the provision of Administrative Services to one or
more other parties (each such party, an "Administrator") selected by the
Manager. Any Administrator may (but need not) be affiliated with the Manager.
2. As used in this Agreement, "Portfolio Management Services" means
management of the investment and reinvestment of the assets belonging to the
Series, consisting specifically of the following:
(a) obtaining and evaluating such economic, statistical and financial
data and information and undertaking such additional investment research as
shall be necessary or advisable for the management of the investment and
reinvestment of the assets belonging to the Series in accordance with the
Series' investment objectives and policies;
(b) taking such steps as are necessary to implement the investment
policies of the Series by purchasing and selling of securities, including the
placing of orders for such purchase and sale; and
(c) regularly reporting to the Board of Trustees of the Fund with
respect to the implementation of the investment policies of the Series.
3. As used in this Agreement, "Administrative Services" means the
provision to the Fund, by or at the expense of the Manager, of the following:
(a) office space in such place or places as may be agreed upon from
time to time by the Fund and the Manager, and all necessary office supplies,
facilities and equipment;
(b) necessary executive and other personnel for managing the affairs
of the Series, including personnel to perform clerical, bookkeeping, accounting,
stenographic and other office functions (exclusive of those related to and to be
performed under contract for custodial, transfer, dividend and plan agency
services by the entity or entities selected to perform such services;
(c) compensation, if any, of trustees of the Fund who are directors,
officers or employees of the Adviser, any Sub-Adviser or any Administrator or of
any affiliated person (other than a registered investment company) of the
Manager, any Sub-Adviser or any Administrator;
(d) all services, other than services of counsel, required in
connection with the preparation of registration statements and prospectuses,
including amendments and revisions thereto, all annual, semiannual and periodic
reports, and notices and proxy
-2-
solicitation material furnished to shareholders of the Fund or regulatory
authorities, to the extent that any such materials relate to the business of the
Series, to the shareholders thereof or otherwise to the Series, the Series to be
treated for these purposes as a separate legal entity and fund; and
(e) supervision and oversight of the Portfolio Management Services
provided by each Sub-Adviser, and oversight of all matters relating to
compliance by the Fund with applicable laws and with the Fund's investment
policies, restrictions and guidelines, if the Manager has delegated to one or
more Sub-Advisers any or all of its responsibilities hereunder with respect to
the provision of Portfolio Management Services.
4. Nothing in section 3 hereof shall require the Manager to bear, or to
reimburse the Fund for:
(a) any of the costs of printing and mailing the items referred to in
sub-section (d) of such section 3;
(b) any of the costs of preparing, printing and distributing sales
literature;
(c) compensation of trustees of the Fund who are not directors,
officers or employees of the Manager, any Sub-Adviser or any Administrator or of
any affiliated person (other than a registered investment company) of the
Manager, any Sub-Adviser or any Administrator;
(d) registration, filing and other fees in connection with
requirements or regulatory authorities;
(e) the charges and expenses of any entity appointed by the Fund for
custodial, paying agent, shareholder servicing and plan agent services;
(f) charges and expenses of independent accountants retained by the
Fund;
(g) charges and expenses of any transfer agents and registrars
appointed by the Fund;
(h) brokers' commissions and issue and transfer taxes chargeable to
the Fund in connection with securities transactions to which the Fund is a
party;
(i) taxes and fees payable by Fund to federal, state or other
governmental agencies;
(j) any cost of certificates representing shares of the Fund;
-3-
(k) legal fees and expenses in connection with the affairs of the Fund
including registering and qualifying its shares with Federal and State
regulatory authorities;
(l) expenses of meetings of shareholders and trustees of the Fund; and
(m) interest, including interest on borrowings by the Fund.
5. All activities undertaken by the Manager or any Sub-Adviser or
Administrator pursuant to this Agreement shall at all times be subject to the
supervision and control of the Board of Trustees of the Fund, any duly
constituted committee thereof or any officer of the Fund acting pursuant to like
authority.
6. The services to be provided by the Manager and any Sub-Adviser or
Administrator hereunder are not to be deemed exclusive and the Manager and any
Sub-Adviser or Administrator shall be free to render similar services to others,
so long as its services hereunder are not impaired thereby.
7. As full compensation for all services rendered, facilities furnished
and expenses borne by the Manager hereunder, the Fund shall pay the Manager
compensation at the annual rate of 0.75% of the Series' average daily net
assets. Such compensation shall be payable monthly in arrears or at such other
intervals, not less frequently than quarterly, as the Board of Trustees of the
Fund may from time to time determine and specify in writing to the Manager. The
Manager hereby acknowledges that the Fund's obligation to pay such compensation
is binding only on the assets and property belonging to the Series.
8. If the total of all ordinary business expenses of the Fund as a whole
(including investment advisory fees but excluding taxes and portfolio brokerage
commissions) for any fiscal year exceeds the lowest applicable percentage of
average net assets or income limitations prescribed by any state in which shares
of the Series are qualified for sale, the Manager shall pay such excess. Solely
for purposes of applying such limitations in accordance with the foregoing
sentence, the Series and the Fund shall each be deemed to be a separate fund
subject to such limitations. Should the applicable state limitation provisions
fail to specify how the average net assets of the Fund or belonging to the
Series are to be calculated, that figure shall be calculated by reference to the
average daily net assets of the Fund or the Series, as the case may be.
9. It is understood that any of the shareholders, trustees, officers,
employees and agents of the Fund may be a shareholder, director, officer,
employee or agent of, or be otherwise interested in, the Manager, any affiliated
person of the Manager, any organization in which the Manager may have an
interest or any organization which may have an interest in the Manager; that the
Manager, any such affiliated person or any such organization may have an
interest in the Fund; and that the existence of any such dual interest shall not
affect the validity
-4-
hereof or of any transactions hereunder except as otherwise provided in the
agreement and declaration of trust of the Fund, the articles of organization of
the Manager or specific provisions of applicable law.
10. This Agreement shall become effective as of the date of its execution,
and
(a) unless otherwise terminated, this Agreement shall continue in effect
for two years from the date of execution, and from year to year thereafter so
long as such continuance is specifically approved at least annually (i) by the
Board of Trustees of the Fund or by vote of a majority of the outstanding voting
securities of the Series, and (ii) by vote of a majority of the trustees of the
Fund who are not interested persons of the Fund or the Manager, cast in person
at a meeting called for the purpose of voting on, such approval;
(b) this Agreement may at any time be terminated on sixty days' written
notice to the Manager either by vote of the Board of Trustees of the Fund or by
vote of a majority of the outstanding voting securities of the Series;
(c) this Agreement shall automatically terminate in the event of its
assignment;
(d) this Agreement may be terminated by the Manager on ninety days'
written notice to the Fund;
(e) if New England Securities Corporation, the Fund's principal
underwriter, requires the Fund or the Series to change its name so as to
eliminate all references to the words "New England" or the letters "TNE"
pursuant to the provisions of the Fund's Distribution Agreement relating to the
Series with said principal underwriter, this Agreement shall automatically
terminate at the time of such change unless the continuance of this Agreement
after such change shall have been specifically approved by vote of a majority of
the outstanding voting securities of the Series and by vote of a majority of the
trustees of the Fund who are not interested persons of the Fund or the Manager,
cast in person at a meeting called for the purpose of voting on such approval.
Termination of this Agreement pursuant to this section 10 shall be without
the payment of any penalty.
11. This Agreement may be amended at any time by mutual consent of the
parties, provided that such consent on the part of the Fund shall have been
approved by vote of a majority of the outstanding voting securities of the
Series and by vote of a majority of the trustees of the Fund who are not
interested persons of the Fund or the Manager, cast in person at a meeting
called for the purpose of voting on such approval.
-5-
12. For the purpose of this Agreement, the terms "vote of a majority of
the outstanding voting securities," "interested person," "affiliated person" and
"assignment" shall have their respective meanings defined in the 1940 Act,
subject, however, to such exemptions as may be granted by the Securities and
Exchange Commission under the 1940 Act. References in this Agreement to any
assets, property or liabilities "belonging to" the Series shall have the meaning
defined in the Fund's agreement and declaration of trust as amended from time to
time.
13. In the absence of willful misfeasance, bad faith or gross negligence
on the part of the Manager, or reckless disregard of its obligations and duties
hereunder, the Manager shall not be subject to any liability to the Fund, to any
shareholder of the Fund or to any other person, firm or organization, for any
act or omission in the course of, or connected with, rendering services
hereunder.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
day and year first above written.
NEW ENGLAND ZENITH FUND, on TNE ADVISERS, INC.
behalf of its Xxxxxxx Xxxxx Xxxxxx Value
Series
By /s/ Xxxx X. Xxxxxxx, Xx. By /s/ Xxxx X. Xxxxxxx, Xx.
--------------------------------- ---------------------------------
Xxxx X. Xxxxxxx, Xx. Xxxx X. Xxxxxxx, Xx.
Senior Vice President Senior Vice President
NOTICE
A copy of the Agreement and Declaration of Trust establishing New England
Zenith Fund (the "Fund") is on file with the Secretary of The Commonwealth of
Massachusetts, and notice is hereby given that this Agreement is executed with
respect to the Fund's Xxxxxxx Sachs Midcap Value Series (the "Series") on behalf
of the Fund by officers of the Fund as officers and not individually and that
the obligations of or arising out of this Agreement are not binding upon any of
the trustees, officers or shareholders individually but are binding only upon
the assets and property belonging to the Series.
-6-
