AMENDED AND RESTATED
SUBADVISORY AGREEMENT
THIS AGREEMENT is made by and between OppenheimerFunds, Inc., a Colorado
corporation (the "Adviser"), and Xxxxxxxxxxx Capital LLC, a Delaware limited
liability company (the "Subadviser"), as of the date set forth below.
RECITALS
WHEREAS, Xxxxxxxxxxx Quest For Value Funds (the "Company") is registered
under the Investment Company Act of 1940, as amended (the "1940 Act"), as an
open-end, management investment company having one or more series;
WHEREAS, the Adviser is registered under the Investment Advisers Act of
1940, as amended (the "Adviser Act"), as an investment adviser and engages in
the business of acting as an investment adviser;
WHEREAS, the Subadviser is registered under the Advisers Act as an
investment adviser and engages in the business of acting as an investment
adviser;
WHEREAS, the Company's Declaration of Trust authorizes the Board of
Trustees of the Company to classify or reclassify authorized but unissued shares
of the Company into series of shares representing interests in various
investment portfolios;
WHEREAS, pursuant to such authority, the Company has established
Xxxxxxxxxxx Quest Balanced Fund (the "Fund") as a series;
WHEREAS, the Adviser has entered into an Investment Advisory Agreement with
the Company (the "Investment Advisory Agreement"), pursuant to which the Adviser
acts as investment adviser with respect to the Fund; and
WHEREAS, pursuant to Paragraph 2 of the Investment Advisory Agreement, the
Adviser retained the Subadviser's subsidiary, OpCap Advisors LLC, for purposes
of rendering investment advisory services to the Adviser in connection with the
Fund pursuant to a Subadvisory Agreement dated as of March 10, 2000, (the "2000
Subadvisory Agreement"), and the Subadviser has assumed all obligations and
responsibilities of OpCap Advisors in a transaction consistent with Rule 2a-6
under the 1940 Act, and the Adviser wishes to continue to retain the Subadviser
for such purposes pursuant to this Amended and Restated Subadvisory Agreement
(the "Agreement") upon the terms and conditions herein set forth;
NOW THEREFORE, in consideration of the mutual covenants herein contained
and other good and valuable consideration, the receipt of which are hereby
acknowledged, the parties hereto amend and restate the 2000 Subadvisory
Agreement as follows:
I. Appointment and Obligations of the Adviser.
The Adviser hereby appoints the Subadviser to render, to the Adviser with
respect to the Fund, investment research and advisory services as set forth
below in Section II, under the supervision of the Adviser and subject to the
approval and direction of the Company's Board of Trustees (the "Board"), and the
Subadviser hereby accepts such appointment, all subject to the terms and
conditions contained herein. The Subadviser shall, for all purposes herein, be
deemed an independent contractor and shall not have, unless otherwise expressly
provided or authorized, any authority to act for or represent the Company or the
Fund in any way or otherwise to serve as or be deemed an agent of the Company or
the Fund.
II. Duties of the Subadviser and the Adviser.
A. Duties of the Subadviser.
The Subadviser shall regularly provide investment advice with respect to
the Fund and shall, subject to the terms of this Agreement, continuously
supervise the investment and reinvestment of cash, securities and instruments or
other property comprising the assets of the Fund, and in furtherance thereof,
the Subadviser's duties shall include:
1. Obtaining and evaluating pertinent information about significant
developments and economic, statistical and financial data, domestic, foreign or
otherwise, whether affecting the economy generally or the Fund, and whether
concerning the individual issuers whose securities are included in the Fund or
the activities in which such issuers engage, or with respect to securities which
the Subadviser considers desirable for inclusion in the Fund's investment
portfolio;
2. Determining which securities shall be purchased, sold or exchanged by
the Fund or otherwise represented in the Fund's investment portfolio and
regularly reporting thereon to the Adviser and, at the request of the Adviser,
to the Board;
3. Formulating and implementing continuing programs for the purchases and
sales of the securities of such issuers and regularly reporting thereon to the
Adviser and, at the request of the Adviser, to the Board; and
4. Taking, on behalf of the Fund, all actions that appear to the Subadviser
necessary to carry into effect such investment program, including the placing of
purchase and sale orders, and making appropriate reports thereon to the Adviser
and the Board.
B. Duties of the Adviser.
The Adviser shall retain responsibility for, among other things, providing
the following advice and services with respect to the Fund:
1. Without limiting the obligation of the Subadviser to so comply, the
Adviser shall monitor the investment program maintained by the Subadviser for
the Fund to ensure that the Fund's assets are invested in compliance with this
Agreement and the Fund's Registration Statement, as currently in effect from
time to time; and
2. The Adviser shall oversee matters relating to Fund promotion, including,
but not limited to, marketing materials and the Subadviser's reports to the
Board.
III. Representations, Warranties and Covenants.
A. Representations, Warranties and Covenants of the Subadviser.
1. Organization. The Subadviser is now, and will continue to be, a limited
liability company duly formed and validly existing under the laws of its
jurisdiction of formation, fully authorized to enter into this Agreement and
carry out its duties and obligations hereunder.
2. Registration. The Subadviser is registered as an investment adviser with
the Securities and Exchange Commission (the "SEC") under the Advisers Act, and
is registered or licensed as an investment adviser under the laws of all
jurisdictions in which its activities require to be so registered or licensed,
except where the failure to be so licensed would not have a material adverse
effect on the Subadviser. The Subadviser shall maintain such registration or
license in effect at all times during the term of this Agreement.
3. Best Efforts. The Subadviser at all times shall provide its best
judgment and effort to the Adviser and the Fund in carrying out its obligations
hereunder.
4. Other Covenants. The Subadviser further agrees that:
a. it will use the same skill and care in providing such services as it
uses in providing services to other accounts for which it has investment
management responsibilities;
b. it will not make loans to any person to purchase or carry shares of
beneficial interest in the Fund or make loans to the Fund;
c. it will report regularly to the Fund and to the Adviser and will make
appropriate persons available for the purpose of reviewing with representatives
of the Adviser on a regular basis the management of the Fund, including, without
limitation, review of the general investment strategy of the Fund, economic
considerations and general conditions affecting the marketplace;
d. as required by applicable laws and regulations, it will maintain books
and records with respect to the Fund's securities transactions and it will
furnish to the Adviser and to the Board such periodic and special reports as the
Adviser or the Board may reasonably request;
e. it will treat confidentially and as proprietary information of the Fund
all records and other information relative to the Fund, and will not use records
and information for any purpose other than performance of its responsibilities
and duties hereunder, except after prior notification to and approval in writing
by the Fund or when so requested by the Fund or required by law or regulation;
f. it will, on a continuing basis and at its own expense, (1) provide the
distributor of the Fund (the "Distributor") with assistance in the distribution
and marketing of the Fund in such amount and form as the Adviser may reasonably
request from time to time, and (2) use its best efforts to cause the portfolio
manager or other person who manages or is responsible for overseeing the
management of the Fund's portfolio (the "Portfolio Manager") to provide
marketing and distribution assistance to the Distributor, including, without
limitation, conference calls, meetings and road trips, provided that each
Portfolio Manager shall not be required to devote more than 10% of his or her
time to such marketing and distribution activities;
g. it will use its reasonable best efforts (i) to retain the services of
the Portfolio Manager who manages the portfolio of the Fund, from time to time
and (ii) to promptly obtain the services of a Portfolio Manager acceptable to
the Adviser if the services of the Portfolio Manager are no longer available to
the Subadviser;
h. it will, from time to time, assure that each Portfolio Manager is
acceptable to the Adviser;
i. it will obtain the written approval of the Adviser prior to designating
a new Portfolio Manager; provided, however, that, if the services of a Portfolio
Manager are no longer available to the Subadviser due to circumstances beyond
the reasonable control of the Subadviser (e.g., voluntary resignation, death or
disability), the Subadviser may designate an interim Portfolio Manager who (a)
shall be reasonably acceptable to the Adviser and (b) shall function for a
reasonable period of time until the Subadviser designates an acceptable
permanent replacement as set forth in Section XIII D 4; and
j. it will promptly notify the Adviser of any impending change in Portfolio
Manager, portfolio management or any other material matter that may require
disclosure to the Board, shareholders of the Fund or dealers.
B. Representations, Warranties and Covenants of the Adviser.
1. Organization. The Adviser is now, and will continue to be, duly
organized and in good standing under the laws of its state of incorporation,
fully authorized to enter into this Agreement and carry out its duties and
obligations hereunder.
2. Registration. The Adviser is registered as an investment adviser with
the SEC under the Advisers Act, and is registered or licensed as an investment
adviser under the laws of all jurisdictions in which its activities require it
to be so registered or licensed. The Adviser shall maintain such registration or
license in effect at all times during the term of this Agreement.
3. Best Efforts. The Adviser at all times shall provide its best judgment
and effort to the Fund in carrying out its obligations hereunder.
IV. Compliance with Applicable Requirements.
In carrying out its obligations under this Agreement, the Subadviser shall
at all times conform to:
A. all applicable provisions of the 1940 Act and any rules and regulations
adopted thereunder;
B. the provisions of the registration statement of the Company, as the same
may be amended from time to time, under the Securities Act of 1933, as amended,
and the 1940 Act;
C. the provisions of the Company's Declaration of Trust or other governing
document, as amended from time to time;
D. the provisions of the By-laws of the Company, as amended from time to
time;
E. any other applicable provisions of state or federal law; and
F. guidelines, investment restrictions, policies, procedures or
instructions adopted or issued by the Company, the Fund or the Adviser from time
to time.
The Adviser shall promptly notify the Subadviser of any changes or
amendments to the provisions of B., C., D. and F. above when such changes or
amendments relate to the obligations of the Subadviser.
V. Control by the Board.
Any investment program undertaken by the Subadviser pursuant to this
Agreement, as well as any other activities undertaken by the Subadviser with
respect to the Fund, shall at all times be subject to any directives of the
Adviser and the Board.
VI. Books and Records.
The Subadviser agrees that all records which it maintains for the Fund on
behalf of the Adviser are the property of the Fund and further agrees to
surrender promptly to the Fund or to the Adviser any of such records upon
request. The Subadviser further agrees to preserve for the periods prescribed by
applicable laws, rules and regulations all records required to be maintained by
the Subadviser on behalf of the Adviser under such applicable laws, rules and
regulations, or such longer period as the Adviser may reasonably request from
time to time.
VII. Broker-Dealer Relationships.
A. Portfolio Trades.
The Subadviser, at its own expense, and to the extent appropriate, in
consultation with the Adviser, shall place all orders for the purchase and sale
of portfolio securities for the Fund with brokers or dealers selected by the
Subadviser, which may include, to the extent permitted by the Adviser and the
Fund, brokers or dealers affiliated with the Subadviser. The Subadviser shall
use its best efforts to seek to execute portfolio transactions at prices that
are advantageous to the Fund and at commission rates that are reasonable in
relation to the benefits received.
B. Selection of Broker-Dealers.
With respect to the execution of particular transactions, the Subadviser
may, to the extent permitted by the Adviser and the Fund, select brokers or
dealers who also provide brokerage and research services (as those terms are
defined in Section 28(e) of the Securities Exchange Act of 1934, as amended) to
the Fund and/or the other accounts over which the Subadviser or its affiliates
exercise investment discretion. The Subadviser is authorized to pay a broker or
dealer who provides such brokerage and research services a commission for
executing a portfolio transaction for the Fund that is in excess of the amount
of commission another broker or dealer would have charged for effecting that
transaction if the Subadviser determines in good faith that such amount of
commission is reasonable in relation to the value of the brokerage and research
services provided by such broker or dealer. This determination may be viewed in
terms of either that particular transaction or the overall responsibilities that
the Subadviser and its affiliates have with respect to accounts over which they
exercise investment discretion. The Adviser, Subadviser and the Board shall
periodically review the commissions paid by the Fund to determine, among other
things, if the commissions paid over representative periods of time were
reasonable in relation to the benefits received.
C. Soft Dollar Arrangements.
The Subadviser may enter into "soft dollar" arrangements through the agency
of third parties on behalf of the Adviser. Soft dollar arrangements for services
may be entered into in order to facilitate an improvement in performance in
respect of the Subadvisers's service to the Adviser with respect to the Fund.
The Subadviser makes no direct payments but instead undertakes to place business
with broker-dealers who in turn pay third parties who provide these services.
Soft dollar transactions will be conducted on an arm's length basis, and the
Subadviser will secure best execution for the Adviser. Any arrangements
involving soft dollar and/or brokerage services shall be effected in compliance
with Section 28(e) of the Securities Exchange Act of 1934, as amended, and the
policies that the Adviser and the Board may adopt from time to time. The
Subadviser agrees to provide reports to the Adviser as necessary for purposes of
providing information on these arrangements to the Board.
VIII. Compensation.
A. Amount of Compensation. The Adviser shall pay the Subadviser, as
compensation for services rendered hereunder, from its own assets, an annual
fee, payable monthly, and calculated as follows:
1. During the period from January 1, 2005, through December 31, 2005, the
Adviser will pay the Subadviser a fee that is 30% of the advisory fee collected
by the Adviser from the Fund, based on the net assets of the Fund, calculated at
the rates set forth in the investment advisory agreement between Fund and the
Adviser (the "Balanced Fund Advisory Agreement") as a result of the action by
the Board in renewing the Balanced Fund Advisory Agreement in December 2004;
provided, however, that such fee shall be adjusted in arrears on December 31,
2005, as follows if the effective annual fee rate of the fee paid to the
Subadviser during that one-year period is less than the effective fee rate that
would have been paid to the Subadviser based on the fee rates in effect (after
taking breakpoints into account) under the Balanced Fund Advisory Agreement
during 2004: (A) if the difference between the effective annual fee rate to the
Adviser during 2005 and what the effective annual fee rate to the Adviser would
have been under the 2004 advisory fee schedule is 0.05% of average annual net
assets or less, the Adviser will pay the Subadviser a lump sum payment (within
20 days after such annual period) equal to the amount obtained by multiplying
30% of such difference (expressed as basis points) times the average annual net
assets of the Fund during that period; or (B) if the difference between the
effective annual fee rate to the Adviser during 2005 and what the effective fee
rate to the Adviser would have been under the 2004 advisory fee schedule is more
than 0.05% of average annual net assets, the Adviser will pay the Subadviser a
lump sum payment (within 20 days after such annual period) equal to the amount
obtained by multiplying 0.015% times the average annual net assets of the Fund
during the period.
2. In 2006, 2007 and 2008, the Adviser will pay the Subadviser a fee that
shall be 30% of the advisory fee collected by the Adviser from the Fund in each
such year based on the total net assets of the Fund in each such year,
calculated at the rates set forth in the Balanced Fund Advisory Agreement for
the year 2005 as a result of the action by the Board in renewing the Balanced
Fund Advisory Agreement in December 2004, subject to the proviso in subsection
XIII. C., below, calculated after any waivers, voluntary or otherwise.
B. Calculation of Compensation. Except as herein set forth, compensation
under this Agreement shall be calculated and accrued on the same basis as the
advisory fee paid to the Adviser by the Fund. If this Agreement becomes
effective subsequent to the first day of a month or shall terminate before the
last day of a month, compensation for that part of the month this Agreement is
in effect shall be prorated in a manner consistent with the calculation of the
fees set forth above.
C. Payment of Compensation. Subject to the provisions of this paragraph,
payment of the Subadviser's compensation for the preceding month shall be made
within 15 days after the end of the preceding month.
D. Reorganization of the Fund. If the Fund is reorganized with another
investment company for which the Subadviser does not serve as an investment
adviser or subadviser, and the Fund is the surviving entity, the subadvisory fee
payable under this section shall be adjusted in an appropriate manner as the
parties may agree.
IX. Allocation of Expenses.
The Subadviser shall pay the expenses incurred in providing services in
connection with this Agreement, including, but not limited to, the salaries,
employment benefits and other related costs of those of its personnel engaged in
providing investment advice to the Fund hereunder, including, without
limitation, office space, office equipment, telephone and postage costs and
other expenses. In the event of an "assignment" of this Agreement, other than an
assignment resulting solely by action of the Adviser or a affiliate thereof, the
Subadviser shall be responsible for payment of all costs and expenses incurred
by the Adviser and the Fund relating thereto, including, but not limited to,
reasonable legal, accounting, printing and mailing costs related to obtaining
approval of Fund shareholders.
X. Non-Exclusivity.
The services of the Subadviser with respect to the Company and the Fund are
not to be deemed to be exclusive, and the Subadviser shall be free to render
investment advisory and administrative or other services to others (including
other investment companies) and to engage in other activities, subject to the
non-competition provisions of a certain "Relationship Restructuring Agreement"
dated as of December 3, 2004, among the Adviser, OpCap Advisors LLC, the
Subadviser and OCC Distributors LLC (the "Restructuring Agreement"). It is
understood and agreed that officers or directors of the Subadviser may serve as
officers or directors of the Adviser or the Fund; that officers or directors of
the Adviser or the Company may serve as officers or directors of the Subadviser
to the extent permitted by law; and that the officers and directors of the
Subadviser are not prohibited from engaging in any other business activity or
from rendering services to any other person, or from serving as partners,
officers, directors or trustees of any other firm or trust, including other
investment advisory companies (subject to the provisions of the Restructuring
Agreement) provided it is permitted by applicable law and does not adversely
affect the Company or the Fund.
XI. Term.
This Agreement shall become effective on January 1, 2005, and shall remain
in full force and effect from year to year until December 31, 2008 (the "Stated
Termination Date"), provided that this Agreement is approved by the Board and
its continuation is approved at least annually in the manner required under
Section XII, subject to the provisions of Section XIII. Beginning on December
31, 2008, and on each anniversary thereof (each such subsequent anniversary
after December 31, 2008, is referred to as a "Renewal Extension Anniversary"),
this Agreement shall be extended by the Adviser for an additional term of one
year from December 31, 2008, or from the latest such Renewal Extension
Anniversary, as appropriate, unless this Agreement is terminated or not renewed
by the Board, or unless the Adviser shall have provided the Subadviser with two
year's advance written notice of the termination or non-renewal of this
Agreement prior to December 31, 2008, or prior to such Renewal Extension
Anniversary.
XII. Renewal.
This Agreement shall continue in full force and effect from year to year
during the term set forth in Section XI, provided that its continuance is
specifically approved:
A. at least annually (1) by the Board or by the vote of a majority of the
Fund's outstanding voting securities (as defined in Section 2(a)(42) of the 1940
Act), and (2) by the affirmative vote of a majority of the Trustees who are not
parties to this Agreement or interested persons of a party to this Agreement
(other than as a Trustee of the Fund), by votes cast in person at a meeting
specifically called for such purpose; or
B. by such method required by applicable law, rule or regulation then in
effect.
XIII. Termination.
A. Termination by the Company. This Agreement may be terminated at any
time, without the payment of any penalty, by vote of the Board or by vote of a
majority of the Fund's outstanding voting securities, on sixty (60) days'
written notice. The notice provided for herein may be waived by the party
required to be notified.
B. Assignment. This Agreement shall automatically terminate in the event of
its "assignment", as defined in Section 2 (a) (4) of the 1940 Act. In the event
of an assignment that occurs solely due to the change in control of the
Subadviser (provided that no condition exists that permits, or, upon the
consummation of the assignment, will permit, the termination of this Agreement
by the Adviser pursuant to Section XIII.D. hereof), the Adviser and the
Subadviser, at the sole expense of the Subadviser, shall use their reasonable
best efforts to obtain shareholder approval of a successor Subadvisory Agreement
on substantially the same terms as contained in this Agreement.
C. Payment of Fees After Termination. If the Adviser or the Board
terminates this Agreement prior to December 31, 2008 (the "Stated Termination
Date") for any reason other than those set forth in Paragraph XIII.D of this
Agreement, the Adviser will continue, until the Stated Termination Date, to pay
the Subadviser amounts equal to the subadvisory fees that would otherwise be due
under this Agreement, based upon the net assets of the Fund at the close of
business on the termination date; provided, however, that if the rate of the fee
to be paid to the Subadviser is determined as provided in subsection (VIII.A.2)
hereof and would result in an effective fee rate to the Adviser of 0.20% or less
of average annual net assets of the Fund after the payment of the subadvisory
fees to the Subadviser, then the Adviser may terminate this Agreement without
penalty and without obligation to make any further payments to the Subadviser,
other than amounts earned, due and owing at such time. If the Subadviser
terminates this Agreement prior to the Stated Termination Date, the Adviser
shall not owe any further amounts to the Subadviser. If (A) the Adviser provides
two-years' prior notice of non-renewal or termination after December 31, 2006,
the Subadvisory Agreement shall terminate on the second anniversary of the date
of such notice from the Adviser; and (B) if the Board terminates this Agreement
after December 31, 2008, this Agreement shall terminate in accordance with such
action, but in case of either (A) or (B) subject to any obligation of the
Adviser under the paragraph below to a make "Post-Termination Period Payment" to
the Subadviser.
If (A) the Board terminates this Agreement after December 31, 2008, and
prior to a Renewal Extension Anniversary (as defined below), or if (B) after
December 31, 2008, the Adviser terminates this Agreement for a reason other than
those set forth in Paragraph XIII.D. hereof without having given two-years'
prior notice to the Subadviser, or if (C) after December 31, 2006, the Adviser
gives the Subadviser two-years' notice of the non-renewal or termination of this
Agreement and some or all of that two-year notice period falls after December
31, 2008 (the date of the termination of this Agreement under the events
described in (A), (B) and (C) being referred to herein as a "Post-2008
Termination Event"), then the two-year period after such Post-2008 Termination
Event by the Board in (A), the two-year period after the Adviser's termination
of this Agreement in (B), and the portion of the two-year notice period that
falls after December 31, 2008 in (C) shall each be referred to as a
"Post-Termination Period." The Adviser shall pay the Subadviser a fee during a
"Post-Termination Period" in an amount equal to 30% of the advisory fee that the
Adviser would expect to earn during the Post-Termination Period on the average
annual net assets of the Fund, measured at the date of such Post-2008
Termination Event, under the fee rates in the then-effective Balanced Fund
Advisory Agreement (the "Post-Termination Period Payment"). The Post-Termination
Period Payment shall be made in a lump sum within 20 days after the applicable
Post-2008 Termination Event.
Notwithstanding anything to the contrary, if the Subadviser terminates this
Agreement or if this Agreement is terminated by operation of law, due solely to
an act or omission by the Subadviser or its respective subsidiaries, directors,
officers, employees or agents (other than by reason of an "assignment" of this
Agreement), then the Adviser shall not be liable for any further payments under
this Agreement, provided, however, that if at any time prior to the end of the
term of the Restructuring Agreement any event that would have permitted the
termination of this Agreement by the Adviser pursuant to Section XIII.D.(3)
hereof occurs, the Adviser shall be under no further obligation to pay any fees
to the Subadviser.
D. Termination by the Adviser. The Adviser may terminate this Agreement
without penalty and without the payment of any fee or penalty, immediately after
giving written notice, upon the occurrence of any of the following events:
1. The investment performance of the Fund's Class A shares, compared to the
appropriate universe of Class A shares (or their equivalent) used by the Fund to
compare its performance as set forth in Schedule XIII.D.1, ranks in the bottom
quartile for two consecutive calendar years and the Fund's Class A shares have
earned a Morningstar Three-year rating of less than three (3) stars at the time
of such termination; or
2. Any of the Subadviser, its subsidiaries, affiliates, directors,
officers, employees or agents engages in an action or omits to take an action
that would cause the Subadviser to be disqualified in any manner under Section
9(a) of the 1940 Act if the SEC were not to grant an exemptive order under
Section 9(c) thereof or that would constitute grounds for the SEC to deny,
revoke or suspend the registration of the Subadviser as an investment adviser
with the SEC;
3. Any of the Subadviser, its subsidiaries, affiliates, directors,
officers, employees or agents causes a material violation of the Restructuring
Agreement; or
4. The Subadviser breaches the representations contained in Paragraph III.
A. 4. i. of this Agreement or any other material provision of this Agreement,
and any such breach is not cured within a reasonable period of time after notice
thereof from the Adviser to the Subadviser. However, consistent with its
fiduciary obligations, for a period of 60 days the Adviser will not terminate
this Agreement solely because the Subadviser has failed to designate an
acceptable permanent replacement to a Portfolio Manager whose services are no
longer available to the Subadviser due to circumstances beyond the reasonable
control of the Subadviser, provided that the Subadviser uses its reasonable best
efforts to promptly obtain the services of Portfolio Manager acceptable to the
Adviser and further provided that the Adviser has not unreasonably withheld
approval of such replacement Portfolio Manager.
E. Transactions in Progress upon Termination. The Adviser and Subadviser
will cooperate with each other to ensure that portfolio or other transactions in
progress at the date of termination of this Agreement shall be completed by the
Adviser in accordance with the terms of such transactions, and to this end the
Subadviser shall provide the Adviser with all necessary information and
documentation to secure the implementation thereof.
XIV. Non-Solicitation.
During the term of this Agreement, the Adviser (and its affiliates under
its control) shall not solicit or knowingly assist in the solicitation of any
Portfolio Manager of the Fund or any portfolio assistant of the Fund then
employed by the Subadviser, provided, however, that the Adviser (or its
affiliates) may solicit or hire any such individual who (A) the Subadviser (or
its affiliates) has terminated or (B) has voluntarily terminated his or her
employment with the Subadviser (or its affiliates) without inducement of the
Adviser (or its affiliates under its control) prior to the time of such
solicitation. Advertising in general circulation newspapers or industry
newsletters by the Adviser shall not constitute "inducement" by the Adviser (or
its affiliates under its control).
XV. Liability of the Subadviser.
In the absence of willful misfeasance, bad faith, negligence or reckless
disregard of obligations or duties hereunder on the part of the Subadviser or
any of its officers, directors or employees, the Subadviser shall not be subject
to liability to the Adviser for any act or omission in the course of, or
connected with, rendering services hereunder or for any losses that may be
sustained in the purchase, holding or sale of any security; provided, however,
that the foregoing shall not be construed to relieve the Subadviser of any
liability it may have arising under the Restructuring Agreement or the
Acquisition Agreement dated August 17, 1995, among the Subadviser, the Adviser
and certain affiliates of the Subadviser.
XVI. Notices.
Any notice or other communication required or that may be given hereunder
shall be in writing and shall be delivered personally, telecopied, sent by
certified, registered or express mail, postage prepaid or sent by national
next-day delivery service and shall be deemed given when so delivered personally
or telecopied, or if mailed, two days after the date of mailing, or if by
next-day delivery service, on the business day following delivery thereto, as
follows or to such other location as any party notifies any other party:
A. if to the Adviser, to:
OppenheimerFunds, Inc.
Two World Financial Center
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxxxx X. Xxxx
Executive Vice President and General Counsel
Telecopier: 000-000-0000
B. if to the Subadviser, to:
Xxxxxxxxxxx Capital LLC
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxxxxx X. Xxxx
Secretary
Telecopier: 000-000-0000
XVII. Questions of Interpretation.
This Agreement shall be governed by the laws of the State of New York
applicable to agreements made and to be performed entirely within the State of
New York (without regard to any conflicts of law principles thereof). 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 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 the 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.
XVIII. Form ADV - Delivery.
The Adviser hereby acknowledges that it has received from the Subadviser a
copy of the Subadviser's Form ADV, Part II as currently filed, at least 48 hours
prior to entering into this Agreement and that it has read and understood the
disclosures set forth in the Subadviser's Form ADV, Part II.
XIX. 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. 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. This Agreement shall
be binding upon and shall inure to the benefit of the parties hereto and their
respective successors.
XX. Counterparts.
This agreement may be executed in counterparts, each of which shall
constitute an original and both of which, collectively, shall constitute one
agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in duplicate by their respective officers as of the 1st day of January,
2005.
OppenheimerFunds, Inc.
By:______________________________
Xxxxxxxxxxx Capital LLC
By:_____________________________
SCHEDULE XIII.D.1
The universe of funds to which Class A shares of the Fund will be compared
to so that it can be determined in which quartile the performance ranks shall
consist of those funds with the same Lipper investment objective being offered
as the only class of shares of such fund or, in the case where there is more
than one class of shares being offered, with a front-end load (typically
referred to as Class A shares). The present Lipper investment objective category
for the Fund is "Balanced."
