EXHIBIT d(39)
FORM OF
ADVISORY AGREEMENT
ADVISORY AGREEMENT, dated February 27, 2001, between FFTW Funds, Inc. a
Maryland corporation (the "Fund") and Xxxxxxx Xxxxxxx Trees & Xxxxx, Inc., a New
York corporation (the "Adviser"). This Agreement amends and restates the
Management Agreement between the Fund and the Adviser, dated as of November 30,
1989, as amended as of September 25, 1990, and August 31, 1991.
In consideration of the mutual agreements herein made, the parties hereto
agree as follows:
1. ATTORNEY-IN-FACT. The Fund appoints the Adviser as its
attorney-in-fact to invest and reinvest the assets of the U.S. Short-Term
Portfolio (the "Portfolio"), as fully as the Fund itself could do. The Adviser
hereby accepts this appointment.
2. DUTIES OF THE ADVISER. (a) The Adviser be responsible for managing the
investment portfolio ofthe Portfolio, including, without limitation, providing
investment research, advice and supervision, determining which portfolio
securities shall be purchased or sold bythe Portfolio, purchasing and selling
securities on behalf of the Portfolio and determining how voting and other
rights with respect to portfolio securities of the Portfolio shall be exercised,
subject in each case to the control of the Board of Directors of the Fund (the
"Board") and in accordance with the objectives, policies and principles of the
Portfolio set forth in the Registration Statement, as amended, of the Fund, the
requirements of the Investment Company Act of 1940, as amended (the "Act") and
other applicable law. In performing such duties, the Adviser shall provide such
office space, and such executive and other personnel as shall be necessary for
the investment operations of thePortfolio.
(b) Subject to Section 36 of the Act, the Adviser shall not be liable to
the Fund for any error of judgment or mistake of law or for any loss arising out
of any investment or for any act or omission in the management of the Portfolio
and the performance of its duties under this Agreement except for losses arising
out of the Adviser's bad faith, willful misfeasance or gross negligence in the
performance of its duties or by reason of its reckless disregard of its
obligations and duties under this Agreement. It is agreed that the Adviser shall
have no responsibility or liability for the accuracy or completeness of the
Fund's Registration Statement under the Act and the Securities Act of 1933
except for information supplied by the Adviser for inclusion thereinabout the
Adviser. The Fund agrees to indemnify the Adviser for any claims, losses, costs,
damages, or expenses (including fees and disbursements of counsel, but excluding
the ordinary expenses of the Adviser arising from the performance of its duties
and obligations under this Agreement) whatsoever arising out of the performance
of this Agreement except for those claims, losses, costs, damages and expenses
resulting from the Adviser's bad faith, willful
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misfeasance or gross negligence in the performance of its duties or by reason of
its reckless disregard of its obligations and duties under this Agreement.
(c) The Adviser and its officers may act and continue to act as investment
advisers and managers for others (including, without limitation, other
investment companies), and nothing in this Agreement will in any way be deemed
to restrict the right of the Adviser to perform investment management or other
services for any other person or entity, and the performance of such services
for others will not be deemed to violate or give rise to any duty or obligation
to the Fund.
(d) Except as provided in Paragraph 5, nothing in this Agreement will
limit or restrict the Adviser or any of its officers, affiliates or employees
from buying, selling or trading in any securities for its or their own account
or accounts. The Fund acknowledges that the Adviser and its officers, affiliates
or employees, and its other clients may at any time have, acquire, increase,
decrease or dispose of positions in investments which are at the same time being
acquired or disposed of for the account of the Portfolio. The Adviser will have
no obligation to acquire for the Portfolio a position in any investment which
the Adviser, its officers, affiliates or employees may acquire for its or their
own accounts or for the account of another client, if in the sole discretion of
the Adviser, it is not feasible or desirable to acquire a position in such
investment for the account of The Portfolio.
3. EXPENSES. The Adviser shall pay all of its expenses arising from the
performance of its obligations under this Agreement and shall pay any salaries,
fees and expenses of the Directors and officers of the Fund who are employees of
the Adviser or its affiliates. Except as provided below, the Adviser shall not
be required to pay any other expenses of the Fund, including, without
limitation, organization expenses of the Fund (including out-of-pocket expenses,
but not including the Adviser's overhead or employee costs); brokerage
commissions, maintenance of books and records which are required to be
maintained by the Fund's custodian or other agents of the Fund; telephone,
telex, facsimile, postage and other communications expenses; expenses relating
to investor and public relations; freight, insurance and other charges in
connection with the shipment of the Fund's portfolio securities; indemnification
of Directors and officers of the Fund; travel expenses (or an appropriate
portion thereof) of Directors and officers of the Fund who are directors,
officers or employees of the Adviser to the extent that such expenses relate to
attendance at meetings of the Board of Directors of the Fund or any committee
thereof or advisors thereto held outside of New York, New York; interest, fees
and expenses of independent attorneys, auditors, custodians, accounting agents,
transfer agents, dividend disbursing agents and registrars; payment for
portfolio pricing or valuation service to pricing agents, accountants, bankers
and other specialists, if any; taxes and government fees; cost of stock
certificates and any other expenses (including clerical expense) of issue, sale,
repurchase or redemption of shares; expenses of registering and qualifying
shares of the Fund under Federal and state laws and regulations; expenses of
printing and distributing reports, notices, dividends and proxy materials to
existing stockholders; expenses of printing and filing
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reports and other documents filed with governmental agencies, expenses of
printing and distributing prospectuses; expenses of annual and special
stockholders' meetings; costs of stationery, fees and expenses (specifically
including travel expenses relating to Fund business) of Directors of the Fund
who are not employees of the Adviser or its affiliates; membership dues in the
Investment Company Institute; insurance premiums and extraordinary expenses such
as litigation expenses. If the aggregate annual operating expenses, including
the Adviser's fee, of U.S. Short-Term exceed 0.40% of that Portfolio's average
daily net asset value, then the Adviser shall reimburse the U.S. Short-Term
Portfolio for any such excess.
4. COMPENSATION. (a) As compensation for the services performed and the
facilities and personnel provided by the Adviser pursuant to this Agreement, the
Fund will pay to the Adviser promptly at the end of each fiscal quarter of the
Fund, a fee, calculated on each day during such quarter, at an annual rate of
0.30% of U.S. Short-Term's average daily net assets. The Adviser shall be
entitled to receive during any month such interim payments of its fee hereunder
as the Adviser shall request, provided that no such payment shall exceed 50% of
the amount of such fee then accrued on the books of the Portfolio and unpaid.
(b) If the Adviser shall serve hereunder for less than the whole of any
quarter, the fee payable hereunder shall be prorated.
(c) For purposes of this Section 4, the "average daily net assets" of the
Portfolio shall mean the average of the values placed on the Portfolio's net
assets on each day pursuant to the applicable provisions of the Fund's
Registration Statement, as amended.
5. PURCHASE AND SALE OF SECURITIES. The Adviser or an agent of the
Adviser shall purchase securities from or through and sell securities to or
through such persons, brokers or dealers as the Adviser shall deem appropriate
in order to carry out the policy with respect to the allocation of portfolio
transactions as set forth in the Registration Statement of the Fund, as amended,
or as the Board may direct from time to time. The Adviser will use its
reasonable best efforts to execute all purchases and sales with dealers and
banks on a best net price basis.
Neither the Adviser nor any of its officers, affiliates, or employees will
act as principal or receive any compensation from the Portfolio in connection
with the purchase or sale of investments for the Portfolio other than the fee
referred to in Paragraph 4 hereof.
6. TERM OF AGREEMENT. This Agreement shall continue in full force and
effectuntil two years from the date hereof, and will continue in effect from
year to year thereafter if such continuance is approved in the manner required
by the Act, provided that this Agreement is not otherwise terminated.
The Adviser may terminate this Agreement at any time, without payment of
penalty, upon 60 days' written notice to the Fund. The Fund may terminate this
Agreement with respect to the
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Portfolio at any time, without payment of penalty, on 60 days' written notice to
the Adviser by vote of either the majority of the Board or a majority of the
outstanding stockholders of thePortfolio. This Agreement will automatically
terminate in the event of its assignment (as defined by the Act).
7. RIGHT OF ADVISER IN CORPORATE NAME. The Adviser and the Fund each
agree that the phrase "FFTW", which comprises a component of the Fund's
corporate name, is a property right of the Adviser. The Fund agrees and consents
that: (i) it will only use the phrase "FFTW" as a component of its corporate
name and for no other purpose; (ii) it will not purport to grant to any third
party the right to use the phrase "FFTW" for any purpose; (iii) the Adviser or
any corporate affiliate of the Adviser may use or grant to others the right to
use the phrase "FFTW" or any combination or abbreviation thereof, as all or a
portion of a corporate or business name or for any commercial purpose, including
a grant of such right to any other investment company, and at the request of the
Adviser, the Fund will take such action as may be required to provide its
consent to such use or grant; and (iv) upon the termination of any investment
advisory agreement into which the Adviser and the Fund may enter, the Fund
shall, upon request by the Adviser, promptly take such action, at its own
expense, as may be necessary to change its corporate name to one not containing
the phrase "FFTW" and following such change, shall not use the phrase "FFTW" or
any combination thereof, as part of its corporate name or for any other
commercial purpose, and shall use its best efforts to cause its officers,
directors and stockholders to take any and all actions which the Adviser may
request to effect the foregoing and recovery to the Adviser any and all rights
to such phrase.
8. MISCELLANEOUS. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York. Anything herein to the
contrary notwithstanding, this Agreement shall not be construed to require or to
impose any duty upon either of the parties to do anything in violation of any
applicable laws or regulations.
IN WITNESS WHEREOF, the Fund and the Adviser have caused this Agreement to
be executed by their duly authorized officers as of the date first written
above.
ATTEST FFTW FUNDS, INC.
By: By:
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ATTEST XXXXXXX XXXXXXX TREES & XXXXX, INC.
By: By:
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