EXHIBIT EX-99.D.1
INVESTMENT MANAGEMENT CONTRACT
BETWEEN
HILLVIEW INVESTMENT TRUST II
AND
HILLVIEW CAPITAL ADVISORS, LLC
Contract made as of August 12, 2005, between, Hillview Investment Trust II, a
Delaware business trust ("Trust"),on behalf of the Hillview Alpha Fund and the
Hillview International Alpha Fund (each a "Fund" and collectively the "Funds")
and Hillview Capital Advisors, LLC, a Delaware limited liability company (the
"Manager").
WHEREAS the Trust is registered under the Investment Company Act of 1940, as
amended ("1940 Act"), as an open-end management investment company; and
WHEREAS the Trust desires to retain Manager as investment manager to furnish
certain investment advisory and portfolio management services to the Trust and
the Funds, and Manager is willing to furnish such services;
NOW, THEREFORE, in consideration of the premises and the mutual covenants herein
contained, it is agreed between the parties hereto as follows:
Appointment. The Trust hereby appoints Manager as investment manager for the
period and on the terms set forth in this Contract. Manager accepts such
appointment and agrees to render the services herein set forth, for the
compensation herein provided.
Duties as Investment Manager.
Subject to the supervision of the Trust's Board of Trustees ("Board"), Manager
will provide a continuous investment program for each Fund, including investment
research and management with respect to all securities and investments and cash
equivalents in the Fund. Manager will determine from time to time what
securities and other investments will be purchased, retained or sold by the
Fund, and the brokers and dealers through whom trades will be executed. The
Manager may delegate to a Sub-Adviser, in whole or in part, its duty to provide
a continuous investment management program with respect to any Fund, including
the provision of investment management services with respect to a portion of the
Fund's assets, in accordance with Paragraph 4 of this Contract.
Manager agrees that in placing orders with brokers and dealers it will attempt
to obtain the best net results in terms of price and execution. Consistent with
this obligation Manager may, in its discretion, purchase and sell portfolio
securities to and from brokers and dealers who sell shares of the Fund or
provide the Trust or Manager's other clients with research, analysis, advice and
similar services. Manager may pay to brokers and dealers, in return for research
and analysis, a
3
higher commission or spread than may be charged by other brokers and dealers,
subject to Manager's determining in good faith that such commission or spread is
reasonable in terms either of the particular transaction or of the overall
responsibility of Manager to such Fund and its other clients and that the total
commissions or spreads paid by such Fund will be reasonable in relation to the
benefits to the Fund over the long term. In no instance will portfolio
securities be purchased from or sold to Manager or any affiliated person thereof
except in accordance with the federal securities laws and the rules and
regulations thereunder and any exemptive orders currently in effect. Whenever
Manager simultaneously places orders to purchase or sell the same security on
behalf of a Fund and one or more other accounts advised by Manager, such orders
will be allocated as to price and amount among all such accounts in a manner
believed to be equitable to each account. The Trust recognizes that in some
cases this procedure may adversely affect the results obtained for the Fund.
Manager will oversee the maintenance of all books and records with respect to
the securities transactions of each Fund, and will furnish the Board with such
periodic and special reports as the Board reasonably may request. In compliance
with the requirements of Rule 31a-3 under the 1940 Act, Manager hereby agrees
that all records which it maintains for the Trust are the property of the Trust,
agrees to preserve for periods prescribed by Rule 31a-2 under the 1940 Act any
records which it maintains for the Trust and which are required to be maintained
by Rule 31a-1 under the 1940 Act, and further agrees to surrender promptly to
the Trust any records which it maintains for Trust upon request by the Trust.
Manager will oversee the computation of the net asset value and the net income
of each Fund as described in the currently effective registration statement of
the Trust under the Securities Act of 1933, as amended, and the 1940 Act and any
supplements thereto ("Registration Statement") or as more frequently requested
by the Board.
Further Duties. In all matters relating to the performance of this Contract,
Manager will act in conformity with the Agreement and Declaration of Trust,
By-Laws and Registration Statement of the Trust and with the instructions and
directions of the Board and will comply with the requirements of the 1940 Act,
the rules thereunder, and all other applicable federal and state laws and
regulations.
Delegation of Manager's Duties as Investment Manager. With respect to the Trust
and each Fund, Manager may enter into one or more contracts ("Sub-Advisory
Contract") with a sub-adviser in which Manager delegates to such sub-adviser the
performance of any or all of the services specified in Paragraph 2 of this
Contract, provided that: (i) each Sub-Advisory Contract imposes on the
sub-adviser bound thereby all the corresponding duties and conditions to which
Manager is subject with respect to the delegated services under Paragraphs 2 and
3 of this Contract; (ii) each Sub-Advisory Contract meets all requirements of
the 1940 Act and rules thereunder, and (iii) Manager shall not enter into a
Sub-Advisory Contract unless it is approved by the Board prior to
implementation.
Services Not Exclusive. The services furnished by Manager hereunder are not to
be deemed exclusive and Manager shall be free to furnish similar services to
others so long as its services under this Contract are not impaired thereby.
Nothing in this Contract shall limit or restrict the right of any director,
officer or
4
employee of Manager, who may also be a Trustee, officer or employee, of the
Trust, to engage in any other business or to devote his or her time and
attention in part to the management or other aspects of any other business,
whether of a similar nature or a dissimilar nature.
Expenses.
During the term of this Contract, each Fund will bear all expenses, not
specifically assumed by Manager.
Expenses borne by each Fund will include but not be limited to the following:
(i) all direct charges relating to the purchase and sale of portfolio
securities, including the cost (including brokerage commissions, if any) of
securities purchased or sold by the Fund and any losses incurred in connection
therewith; (ii) fees payable to and expenses incurred on behalf of the Fund by
Manager under this Contract; (iii) fees, and other compensation and expenses of
the Sub-Advisors pursuant to Sub-Advisory Contracts approved by the Trust; (iv)
investment consulting fees and related costs; (v) expenses of organizing the
Trust and the Fund; (vi) expenses of preparing and filing reports and other
documents with governmental and regulatory agencies; (vii) filing fees and
expenses relating to the registration and qualification of the Fund's shares and
the Trust under federal and/or state securities laws and maintaining such
registrations and qualifications; (viii) costs incurred in connection with the
issuance, sale or repurchase of the Fund's shares of beneficial interest; (ix)
fees and salaries payable to the Trust's Trustees who are not parties to this
Contract or interested persons of any such party ("Independent Trustees"); (x)
all expenses incurred in connection with the Independent Trustees' services,
including travel expenses; (xi) taxes (including any income or franchise taxes)
and governmental fees; (xii) costs of any liability, uncollectible items of
deposit and other insurance and fidelity bonds; (xiii) any costs, expenses or
losses arising out of a liability of or claim for damages or other relief
asserted against the Trust or Fund for violation of any law; (xiv) interest
charges; (xv) legal, accounting and auditing expenses, including legal fees of
special counsel for the Independent Trustees; (xvi) charges of custodians,
transfer agents, pricing agents and other agents; (xvii) expenses of disbursing
dividends and distributions; (xviii) expenses of setting in type, printing and
mailing reports, notices and proxy materials for existing shareholders; (xix)
any extraordinary expenses (including fees and disbursements of counsel, costs
of actions, suits or proceedings to which the Trust is a party and the expenses
the Trust may incur as a result of its legal obligation to provide
indemnification to its officers, Trustees, employees and agents) incurred by the
Trust or Fund; (xx) fees, voluntary assessments and other expenses incurred in
connection with membership in investment company organizations; (xxi) costs of
mailing and tabulating proxies and costs of meetings of shareholders, the Board
and any committees thereof; (xxii) the cost of investment company literature and
other publications provided by the Trust to its Trustees and officers; and
(xxiii) costs of mailing, stationery and communications equipment.
Manager will assume the cost of any compensation for services provided to the
Trust received by the officers of the Trust and by the Interested Trustees.
The payment or assumption by Manager of any expense of the Trust or a Fund that
Manager is not required by this Contract to pay or assume shall not obligate
Manager to pay or assume the same or any similar expense of the Trust or a Fund
on any subsequent occasion.
5
Compensation.
For the services provided to each Fund under this Contract, each Fund shall pay
the Manager an annual fee, payable monthly, based upon the Fund's average daily
assets as set forth in Appendix A. Such compensation shall be paid solely from
the assets of the Fund.
For the services provided and the expenses assumed pursuant to this Contract
with respect to any other Fund hereafter established, the Fund will pay to the
Manager from its assets a fee in an amount to be agreed upon in a written fee
agreement ("Fee Agreement") executed by the Trust on behalf of such Fund and by
the Manager. All such Fee Agreements shall provide that they are subject to all
terms and conditions of this Contract.
The fee shall be computed daily and paid monthly to Manager on or before the
last business day of the next succeeding calendar month.
If this Contract becomes effective or terminates before the end of any month,
the fee for the period from the effective date to the end of the month or from
the beginning of such month to the date of termination, as the case may be,
shall be prorated according to the proportion which such period bears to the
full month in which such effectiveness or termination occurs.
Limitation of Liability of Manager and Indemnification. Manager and its
delegates, including any Sub-Adviser to any Fund or the Trust, shall not be
liable and the Trust shall indemnify Manager and its directors, officers and
employees, for any costs or liabilities arising from any error of judgment or
mistake of law or any loss suffered by any Fund, the Trust or any of its
shareholders, in connection with the matters to which this Contract relates
except a loss resulting from willful misfeasance, bad faith or gross negligence
on the part of Manager in the performance by Manager of its duties or from
reckless disregard by Manager of its obligations and duties under this Contract.
Any person, even though also an officer, partner, employee, or agent of Manager,
who may be or become an officer, Trustee, employee or agent of the Trust shall
be deemed, when rendering services to any Fund or the Trust or acting with
respect to any business of such Fund or the Trust, to be rendering such service
to or acting solely for the Fund or the Trust and not as an officer, partner,
employee, or agent or one under the control or direction of Manager even though
paid by it.
Duration and Termination.
This Contract shall become effective upon the date hereabove written, provided
that this Contract shall not take effect with respect to the any Fund unless it
has first been approved (i) by a vote of a majority of the Independent Trustees,
cast in person at a meeting called for the purpose of voting on such approval,
and (ii) by vote of a majority of that Fund's outstanding voting securities.
Unless sooner terminated as provided herein, this Contract shall continue in
effect for two years from the above written date. Thereafter, if not terminated,
with respect to any given Fund this Contract shall continue automatically for
successive annual periods, provided that such continuance is specifically
approved at least annually (i) by a vote of a majority of the Independent
Trustees, cast in person at a meeting called for the purpose voting on such
approval, and (ii) by the Board or by vote of a majority of the outstanding
voting securities of such Fund.
6
Notwithstanding the foregoing, with respect to the Trust this Contract may be
terminated at any time, without the payment of any penalty, by vote of the Board
or by a vote of a majority of the outstanding voting securities of such Fund on
sixty days' written notice to Manager or by Manager at any time, without the
payment of any penalty, on sixty days' written notice to the Trust. Termination
of this Contract with respect to any given Fund shall not affect the continued
effectiveness of the Contract with respect to any other Fund. This Contract will
automatically terminate in the event of its assignment.
Amendment of this Contract. No provision of this Contract may be changed,
waived, discharged or terminated orally, but only by an instrument in writing
signed by the party against which enforcement of the change, waiver, discharge
or termination is sought, and no amendment of this Contract shall be effective
until approved by vote of a majority of such Fund's outstanding voting
securities, when required by the 1940 Act.
Governing Law. This Contract shall be construed in accordance with the laws of
the State of Delaware (without regard to Delaware conflict or choice of law
provisions) and the 1940 Act. To the extent that the applicable laws of the
State of Delaware conflict with the applicable provisions of the 1940 Act, the
latter shall control.
License Agreement. The Trust shall have the non-exclusive right to use the name
"Hillview" to designate any current or future Fund only so long as Hillview
Capital Advisors, LLC serves as investment manager or adviser to the Trust with
respect to such Fund.
Limitation of Shareholder Liability. It is expressly agreed that the obligations
of the Trust hereunder shall not be binding upon any of the Trustees,
shareholders, nominees, officers, agents or employees of the Trust personally,
but shall only bind the assets and property of the Trust, as provided in the
Trust's Agreement and Declaration of Trust. The execution and delivery of this
Contract have been authorized by the Trustees of the Trust and shareholders of
the Trust, and this Contract has been executed and delivered by an authorized
officer of the Trust acting as such; neither such authorization by such Trustees
and shareholders 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 assets and property of the Trust, as
provided in the Trust's Agreement and Declaration of Trust.
Miscellaneous. The captions in this Contract 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. If any provision of this Contract
shall be held or made invalid by a court decision, statute, rule or otherwise,
the remainder of this Contract shall not be affected thereby. This Contract
shall be binding upon and shall inure to the benefit of the parties hereto and
their respective successors. As used in this Contract, the terms "majority of
the outstanding voting securities," "interested person," "assignment," "broker,"
"dealer," "investment adviser," "national securities exchange," "net assets,"
"prospectus," "sale," "sell" and "security" shall have the same meaning as such
terms have in the 1940 Act, subject to such exemption as may be granted by the
Securities and Exchange Commission by any rule, regulation or order. Where the
effect of a requirement of the 1940 Act reflected in any provision of this
Contract is made less restrictive by a rule, regulation or order of the
Securities and Exchange Commission, whether of special or
7
general application, such provision shall be deemed to incorporate the effect of
such rule, regulation or order.
8
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed by their officers designated as of the day and year first above
written.
HILLVIEW INVESTMENT TRUST II
By: /s/ Xxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: President and Trustee
HILLVIEW CAPITAL ADVISORS, LLC
By: /s/ Xxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Chief Executive Officer
9
APPENDIX A
TO
INVESTMENT MANAGEMENT CONTRACT
BETWEEN
HILLVIEW INVESTMENT TRUST II
AND
HILLVIEW CAPITAL ADVISORS, LLC
Each Fund shall pay the Manager a fee, computed daily and paid monthly, at the
annual rate of 0.25% of the Fund's average daily assets.
Dated: August 12, 2005
10
