ADVISORY AND SERVICE CONTRACT
BETWEEN
ACTIVA MUTUAL FUND TRUST
AND
ACTIVA ASSET MANAGEMENT, LLC
AGREEMENT made as of the 11th day of June 1999 between the ACTIVA
MUTUAL FUND TRUST, a Delaware business trust (hereinafter called the "Trust") on
behalf of each fund series ("Fund") identified on Schedule A, and ACTIVA ASSET
MANAGEMENT, a Michigan LLC (hereinafter called the "Adviser");
WITNESSETH:
In consideration of the mutual covenants hereinafter contained, it is
hereby agreed by the parties hereto as follows:
1. DUTIES OF THE ADVISER. The Trust hereby employs the Adviser to
provide investment management services on a regular basis to each Series of the
Trust set forth on Exhibit A hereto ("Fund"). Such services shall be subject to
the review and approval of the Board of Trustees of the Trust, and to the
provisions of the Fund's current prospectus, and shall include (i) managing the
Fund's portfolio; (ii) setting the overall investment strategies of the Fund;
(iii) allocating and, when appropriate, reallocating the assets of the Fund
among Sub-Advisers in those cases where a Fund has more than one Sub-Adviser;
(iv) recommending Sub-Advisers when appropriate; and (v) monitoring and
evaluating the investment performance of the Sub-Advisers of the Funds,
including their compliance with the investment objectives, policies and
restrictions of the Funds. The Adviser will, from time to time, discuss with the
Trust economic investment developments which may affect the Fund's portfolio and
furnish such information as the Adviser may believe appropriate for this
purpose. The Adviser will maintain such statistical and analytical information
with respect to the Fund's portfolio securities as the Adviser may believe
appropriate, and shall make such materials available for inspection by the
Trust, as may be reasonable. The Adviser, for all purposes herein provided,
shall be deemed to be an independent contractor and, unless otherwise expressly
provided or authorized, shall have no authority to act for or represent the
Trust in any way or otherwise be deemed an agent of the Trust. The Adviser shall
be free to render similar services or other services to others so long as its
services hereunder shall not be impaired thereby. The Adviser shall be permitted
to enter into an agreement with another investment advisory organization whereby
the other organization will provide all or a part of the investment advice and
the services required to manage the Trust's investment portfolio. The fees for
such services shall be paid by the Adviser, not the Trust or the Funds. Any such
agreement will be subject to approval as required in Section 5 herein.
2. FEES AND EXPENSES. For the services and facilities to be rendered,
as provided herein, during any fiscal quarter by the Adviser hereunder, the
Trust shall pay the Adviser a fee, payable quarterly, at the annual rate for
each Fund as set forth in Exhibit A. Each Fund's assets shall be determined as
of the close of each business day throughout the quarter. For the month and year
in which this agreement become effective or terminates, there shall be an
appropriate proration on the basis of the number of days that the agreement is
in effect during the month and year, respectively.
It is understood that each Fund will pay all its expenses other than
those expressly stated to be payable by the Adviser hereunder. The expenses
payable by each Fund shall include, without implied limitation, (i) expenses of
maintaining the Fund and continuing its existence; (ii) registration of the
Trust under the Investment Company Act of 1940; (iii) commissions, fees and
other expenses connected with the acquisition, disposition and valuation of
securities and other investments; (iv) auditing, accounting and legal expenses;
(v) taxes and interest; (vi) government fees; (vii) expenses of issue, sale,
repurchase and redemption of shares; (viii) expenses of registering and
qualifying the Trust, the Fund and its shares under federal and state securities
laws and of preparing and printing prospectuses for such purposes and for
distributing the same to shareholders and investors, and fees and expenses of
registering and maintaining registrations of the Fund and of the Fund's
principal underwriters, if any, as broker-dealer or agent under state securities
laws; (ix) expenses of reports and notices to stockholders and of meetings of
stockholders and proxy solicitations therefore; (x) expenses of reports to
governmental officers and commissions; (xi) insurance expenses; (xii)
association membership dues; (xiii) fees, expenses and disbursements of
custodians and sub-custodians for all services to the Trust (including without
limitation safekeeping of funds and securities, and keeping of books and
accounts); (xiv) fees, expenses and disbursement of transfer agents, dividend
disbursing agents, stockholder servicing agents and registrars for all services
to the Trust; (xv) expenses for servicing shareholder accounts; (xvi) any direct
charges to shareholders approved by the Trustees of the Trust; and (xvii) such
non-recurring items as may arise, including expenses incurred in connection with
litigation, proceedings and claims and the obligation of the Trust to indemnify
its Trustees and officers with respect thereto.
3. MUTUAL INTERESTS. Subject to applicable statutes and regulations, it
is understood that trustees, officers, beneficial shareholders, or agents of the
Trust or the Funds may be interested in the Adviser as directors, officers,
stockholders, agents, or otherwise; and that the directors, officers,
stockholders, and agents of the Adviser may be interested in the Trust or the
Funds otherwise than as directors, officers, or agents.
4. LIMITATION OF LIABILITY OF THE ADVISER. The Adviser shall not be
liable for any error of judgment or of law, or for any loss suffered by the
Trust, the Funds, or any stockholder in connection with the matters to which
this agreement relates, except 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.
5. DURATION AND TERMINATION OF THIS AGREEMENT. This agreement shall
become effective upon execution and shall remain in force for two years, unless
sooner terminated as hereinafter provided and shall continue in force from year
to year thereafter, but only so long as such continuance is specifically
approved, at least annually, by a majority vote of the Trustees of the Trust,
including a majority of the Trustees who are not parties to the agreement or
interested persons of any such party (other than as Trustees of the Trust) or by
a vote of a majority of the Trust's outstanding shares, but in either case by
the disinterested Trustees, in the manner required by the Investment Company Act
of 1940.
This agreement may be terminated by the Trust or by the Adviser at any
time without payment of any penalty by vote of the Trustees of the Trust, or by
the Adviser, or by vote of the holders of a majority of the outstanding shares
of the Fund on sixty (60) days' written notice to the other parties hereto.
Termination of this agreement shall not affect the right of the Adviser
to receive payments on any unpaid balance of the compensation described in
Section 2 earned prior to such termination.
If any provision of this agreement shall be held or made invalid by a
court decision, statute, rule or otherwise, the remainder shall not be thereby
affected.
This agreement shall automatically terminate in the event of its
assignment. The term "assignment" for this purpose has the meaning defined in
Section 2(a)4 of the Investment Company Act of 1940.
6. USE OF THE TRUST NAME. The Adviser hereby consents to the use by the
Fund of the Trust name "Activa" as part of the Fund's name; provided, however,
that such consent shall be conditioned upon the employment of the Adviser or any
one of its affiliates as the manager of the Fund. The Trust name "Activa" or any
variation thereof may be used from time to time in other connections and for
other purposes by the Adviser and its affiliates and other investment companies
that have obtained consent to the use of the Trust name "Activa." The Adviser
shall have the right to require the Fund to cease using the name "Activa" as
part of the Fund's name if the Fund ceases, for any reason, to employ the
Adviser or one of its affiliates as the Fund's adviser. Future names adopted by
the Fund itself, insofar as such names include identifying words requiring the
consent of the Adviser, shall be the property of the Adviser and shall be
subject to the same terms and conditions.
7. LIMITATION OF LIABILITY OF THE TRUSTEES, OFFICERS, AND SHAREHOLDERS.
A copy of the Agreement and Declaration of Trust of the Fund is on file with the
Secretary of State of The Commonwealth of Delaware and notice is hereby given
that this instrument is executed on behalf of the Trustees of the Fund as
Trustees and not individually and that the obligations of or arising out of this
instrument are not binding upon any of the Trustees, officers or shareholders
individually but are binding only upon the assets and property of the Fund.
8. WRITTEN NOTICE. Any notice under this agreement shall be in writing
addressed and delivered or mailed postage prepaid, to the other parties at such
address as such other parties may designate for the receipt of such notices.
IN WITNESS WHEREOF, the Trust and the Adviser have caused this
agreement to be signed, as of the day and year first above written.
ACTIVA MUTUAL FUND TRUST
By: ________________________________
Xxxxx X. Xxxxxxxxx
President
ACTIVA ASSET MANAGEMENT, LLC
By: ________________________________
Xxxxx X. Xxxxx
President
