FORM OF INVESTMENT ADVISORY
AGREEMENT
[Date]
Xxxxx Xxxxxx Strategy Advisers, Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Dear Sirs:
Xxxxx Xxxxxx Equity Funds (the Company), a
trust organized under the laws of the Commonwealth
of
Massachusetts, on behalf of Xxxxx Xxxxxx Strategic
Investors Fund (the "Fund"), confirms its agreement with
Xxxxx Xxxxxx Strategy Advisers Inc. (the Adviser), as
follows:
1. Investment Description; Appointment
The Company desires to employ its capital relating
to the Fund by investing and reinvesting in
investments of the kind and in accordance with
the investment
objective(s), policies and limitations specified in
its Master Trust Agreement, as amended from time to
time (the "Master Trust Agreement"), in the
Prospectus
relating to the Fund (the "Prospectus") and
the
Statement of Additional Information relating to
the
Company (the "Statement") filed with the Securities
and Exchange Commission (the "SEC") as part of the
Fund's Registration Statement on Form N-lA, as
amended from time to time, and in such manner and to
such extent as may from time to time be approved
by the Board of
Trustees of the Company (the "Board"). Copies of
the
Fund's Prospectus, the Statement and the Master
Trust Agreement have been or will be submitted to the
Adviser The Company desires to employ and hereby
appoints the Adviser to act as the Funds investment
adviser. The
Adviser accepts the appointment and agrees to
furnish the services for the compensation set forth below.
2. Services as Investment Adviser
Subject to the supervision, direction and approval
of the Board of the Company, the Adviser will: (a)
manage the Fund's portfolio in accordance with the
Fund's investment objective and policies as stated
in the
Prospectus and the Statement; (b) make
investment
decisions for the Fund; (c) place purchase and
sale orders for portfolio transactions for the Fund;
and (d) employ
professional portfolio managers and securities
analysts to provide research services to the Fund.
In
providing those services, the Adviser will conduct
a continual program of investment, evaluation and,
if
appropriate, sale and reinvestment of the
Fund's
assets. The Adviser may, with the approval of the
Board and the shareholders of the Fund (to
the extent
required by applicable law), from time to time,
subcontract with one or more sub-investment
advisers to
provide some or all of the services required under
this agreement.
3. Brokerage
In selecting brokers or dealers to execute
transactions
on behalf of the Fund, the Adviser will seek the
best overall terms available. In assessing the
best overall
terms available for any transaction, the Adviser
will
consider factors it deems relevant, including,
but not
limited to, the breadth of the market in the
security, the price of the security, the financial
condition and execution capability of the broker or
dealer and the
reasonableness of the commission, if any, for
the
specific transaction and on a continuing basis.
In
selecting brokers or dealers to execute a
particular
transaction, and in evaluating the best overall
terms available, the Adviser is authorized to
consider the
brokerage and research services (as those terms
are
defined in Section 28(e) of the Securities Exchange
Act
of 1934, as amended) provided to the Fund and/or
other
accounts over which the Adviser or its
affiliates
exercise investment discretion.
4. Information Provided to the Fund
The Adviser will keep the Company informed
of
developments materially affecting the Fund's
portfolio, and will, on its own initiative, furnish
the Company
from time to time with whatever information the
Adviser
believes is appropriate for this purpose.
5. Standard of Care
The Adviser shall exercise its best judgment
in
rendering the services listed in paragraphs 2
and 3
above. The Adviser shall not be liable for any
error
of judgment or mistake of law or for any loss
suffered
by the Company in connection with the matters to
which this Agreement relates, provided that nothing
in this
Agreement shall be deemed to protect or purport
to
protect the Adviser against any liability
to the
Company or to the shareholders of the Fund to which
the Adviser would otherwise be subject by reason of
willful
malfeasance, bad faith or gross negligence on its
part
in the performance of its duties or by reason
of the
Adviser's reckless disregard of its obligations
and
duties under this Agreement.
6. Compensation
In consideration of the services rendered pursuant
to
this Agreement, the Fund will pay the Adviser,
on the
first business day of each month, a fee for
the
previous month at the annual rate of 0.55% of 1.00%
of
the Fund's average daily net assets. The fee
for the
period from the Effective Date (defined below)
of the
Agreement to the end of the month during which
the
Effective Date occurs shall be pro-rated according
to
the proportion that such period bears to the
full
monthly period. Upon any termination of this
Agreement
before the end of any month, the fee for such
part of
that month shall be pro-rated according
to the
proportion that such period bears to the full
monthly
period and shall be payable upon the
date of
termination of this Agreement. For the purpose
of
determining fees payable to the Adviser, the value
of
the Fund's net assets shall be computed at the
times
and in the manner specified in the Fund's
Prospectus
and/or the Statement, as from time to time in effect.
7. Expenses
The Adviser will bear all expenses in connection
with
the performance of its services under this
Agreement and will pay to any sub-investment adviser
or advisers
retained by the Adviser to provide advisory services
to
the Fund (a Sub-Adviser) the fees required to
be paid
to each Sub-Adviser. The Fund will bear certain
other
expenses to be incurred in its operation,
including:
investment advisory, sub-investment advisory
and
administration fees, other than those payable to
a Sub-
Adviser or any additional or substitute sub-
investment
adviser;; fees for necessary professional and
brokerage
services; fees for any pricing service; the costs
of
regulatory compliance; and cost associated
with
maintaining the Companys legal existence
and
shareholder relations.
8. Reduction of Fee
If in any fiscal year the aggregate expenses
of the
Fund (including fees pursuant to this Agreement
and the
Funds sub-investment advisory and
administration
agreements, but excluding interest, taxes,
brokerage
and extraordinary expenses) exceed the
expense
limitation of any state having jurisdiction over
the
Fund, the Adviser will reduce its fee to the
Fund by
the proportion of such excess expense equal
to the
proportion that its fee thereunder bears
to the
aggregate of fees paid by the Fund for
investment
advice and administration in that year, to the
extent
required by state law. A fee reduction pursuant
to this
paragraph 8, if any, will be estimated, reconciled
and
paid on a monthly basis.
9. Services to Other Companies or Accounts
The Company understands that the Adviser now acts,
will
continue to act and may act in the future
as:
investment adviser to fiduciary and other
managed
accounts, as well as investment adviser to
other
investment companies; and the Company has no
objection
to the Adviser's so acting, provided that whenever
the Fund and one or more other investment companies
advised
by the Adviser have available funds for
investment,
investments suitable and appropriate for each
will be
allocated in accordance with a formula believed to
be
equitable to each company. The Fund recognizes
that in
some cases this procedure may adversely affect the
size
of the position obtainable for the Fund. In
addition,
the Fund understands that the persons employed
by the
Adviser to assist in the performance of the
Adviser's
duties under this Agreement will not devote their
full
time to such service and nothing contained in
this
Agreement shall be deemed to limit or restrict
the
right of the Adviser or any affiliate of the Adviser
to
engage in and devote time and attention to
other
businesses or to render services of whatever kind
or
nature.
l0. Term of Agreement
This Agreement shall become
effective
__________________, 1995 (the Effective Date)
and
shall continue for an initial two-year term and
shall
continue thereafter so long as such continuance
is
specifically approved at least annually by (i)
the
Board of the Company or (ii) a vote of a "majority"
(as defined in the Investment Company Act of 1940,
as
amended (the "1940 Act") of the Fund's
outstanding
voting securities, provided that in either event
the
continuance is also approved by a majority of the
Board who are not "interested persons" (as defined
in the 0000 Xxx) of any party to this Agreement, by
vote cast in person or by proxy at a meeting
called for the
purpose of voting on such approval. This Agreement
is
terminable, without penalty, on 60 days'
written
notice, by the Board of the Company or by vote
of
holders of a majority of the Fund's shares, or upon
90
days' written notice, by the Adviser. This
Agreement will also terminate automatically in the
event of its assignment (as defined in the 1940 Act).
11. Representation by the Fund
The Company represents that a copy of the Master
Trust Agreement is on file with the
Secretary of the
Commonwealth of Massachusetts and with the City
of
Boston.
12. Limitation of Liability
The Company and the Adviser agree that the
obligations of the Company under this Agreement
shall not be
binding upon any of the Board members,
shareholders, nominees, officers, employees or
agents, whether past,
present or future, of the Company individually, but
are
binding only upon the assets and property of
the
Company, as provided in the Master Trust
Agreement.
The execution and delivery of this Agreement have
been duly authorized by the Board and a
majority of the
holders of the Funds outstanding voting
securities, are signed by an authorized
officer of the Company,
acting as such, and neither such authorization by
such
Board members and shareholders, nor the execution
and delivery by the 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 Company as
provided
in the Master Trust Agreement.
If the foregoing is in accordance with
your
understanding, kindly indicate your acceptance of t
his
Agreement by signing and returning the enclosed copy
of
this Agreement.
Very truly yours,
XXXXX XXXXXX EQUITY FUNDS
on behalf of XXXXX XXXXXX
STRATEGIC INVESTORS FUND
By:________________________________
Title:
Accepted:
XXXXX XXXXXX STRATEGY ADVISERS INC.
By:_____________________________
Title:
