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EXHIBIT 99.B5
INVESTMENT MANAGEMENT AGREEMENT
AGREEMENT made this 4th day of January, 1996, by and between TAX-
EXEMPT CALIFORNIA MONEY MARKET FUND, a Massachusetts business
trust (the "Fund"), and XXXXXX FINANCIAL SERVICES, INC., a
Delaware corporation (the "Adviser").
WHEREAS, the Fund is an open-end, diversified management
investment company registered under the Investment Company Act of
1940, the shares of beneficial interest ("Shares") of which are
registered under the Securities Act of 1933; and
WHEREAS, the Fund is authorized to issue Shares in separate
series with each such series representing the interests in a
separate portfolio of securities and other assets; and
WHEREAS, the Fund intends initially to offer Shares in one
portfolio, the Initial Portfolio, together with any other Fund
portfolios which may be established later and served by the
Adviser hereunder, being herein referred to collectively as the
"Portfolios" and individually referred to as a "Portfolio"; and
WHEREAS, the Fund desires at this time to retain the Adviser to
render investment advisory and management services to the Initial
Portfolio, and the Adviser is willing to render such services;
NOW THEREFORE, in consideration of the mutual covenants
hereinafter contained, it is hereby agreed by and between the
parties hereto as follows:
1. The Fund hereby employs the Adviser to act as the investment
adviser for the Initial Portfolio and other Portfolios hereunder
and to manage the investment and reinvestment of the assets of
such Portfolio in accordance with the applicable investment
objectives and policies and limitations, and to administer the
affairs to the extent requested by and subject to the supervision
of the Board of Trustees of the Fund for the period and upon the
terms herein set forth. The investment of funds shall be subject
to all applicable restrictions of the Agreement and Declaration
of Trust and By-Laws of the Fund as may from time to time be in
force.
The Adviser accepts such employment and agrees during such period
to render such services, to furnish office facilities and
equipment and clerical, bookkeeping and administrative services
for the Fund, to permit any of its officers or employees to serve
without compensation as trustees or officers of the Fund if
elected to such positions and to assume the obligations herein
set forth for the compensation herein provided. The Adviser
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shall for all purposes herein provided be deemed to be an
independent contractor and, unless otherwise expressly provided
or authorized, shall have no authority to act for or represent
the Fund in any way or otherwise be deemed an agent of the Fund.
It is understood and agreed that the Adviser, by separate
agreements with the Fund, may also serve the Fund in other
capacities.
2. In the event that the Fund establishes one or more
portfolios other than the Initial Portfolio with respect to which
it desires to retain the Adviser to render investment advisory
and management services hereunder, it shall notify the Adviser in
writing. If the Adviser is willing to render such services, it
shall notify the Fund in writing whereupon such portfolio or
portfolios shall become a Portfolio or Portfolios hereunder.
3. For the services and facilities described in Section 1, the
Fund will pay to the Adviser at the end of each calendar month,
an investment management fee computed at an annual rate of 0.22
of 1% of the first $500 million of average daily net assets of
the Portfolios, 0.20 of 1% of the next $500 million, .175 of 1%
of the next $1 billion, .16 of 1% of the next $1 billion and .15
of 1% of average daily net assets of the Portfolios over $3
billion. The fee as computed above shall be allocated as an
expense of each Portfolio based upon the relative daily net
assets of such Portfolios. For the month and year in which this
Agreement becomes 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.
4. The services of the Adviser to the Fund under this Agreement
are not to be deemed exclusive, and the Adviser shall be free to
render similar services or other services to others so long as
its services hereunder are not impaired thereby.
5. In addition to the fee of the Adviser, the Fund shall assume
and pay any expenses for services rendered by a custodian for the
safekeeping of the Fund's securities or other property, for
keeping its books of account, for any other charges of the
custodian, and for calculating the net asset value of the Fund as
provided in the prospectus of the Fund. The Adviser shall not be
required to pay and the Fund shall assume and pay the charges and
expenses of its operations, including compensation of the
trustees (other than those affiliated with the Adviser), charges
and expenses of independent auditors, of legal counsel, of any
transfer or dividend disbursing agent, and of any registrar of
the Fund, costs of acquiring and disposing of portfolio
securities, interest, if any, on obligations incurred by the
Fund, costs of share certificates and of reports, membership dues
in the Investment Company Institute or any similar organization,
costs of reports and notices to shareholders, other like
miscellaneous expenses and all taxes and fees payable to federal,
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state or other governmental agencies on account of the
registration of securities issued by the Fund, filing of trust
documents or otherwise. The Fund shall not pay or incur any
obligation for any expenses for which the Fund intends to seek
reimbursement from the Adviser as herein provided without first
obtaining the written approval of the Adviser. The Adviser shall
arrange, if desired by the Fund, for officers or employees of the
Adviser to serve, without compensation from the Fund, as
trustees, officers or agents of the Fund if duly elected or
appointed to such positions and subject to their individual
consent and to any limitations imposed by law.
If expenses borne by the Fund for those Portfolios which the
Adviser manages in any fiscal year (including the Adviser's fee,
but excluding interest, taxes, fees incurred in acquiring and
disposing of portfolio securities, distribution services fees,
and, to the extent permitted, extraordinary expenses) exceed any
applicable limitation arising under state securities laws, the
Adviser will reduce its fee or reimburse the Fund for any excess
to the extent required by such state securities laws. The
expense limitation guarantee shall be allocated to each such
Portfolio upon a fee reduction or reimbursement based upon the
relative average daily net assets of each such Portfolio. If for
any month the expenses of the Fund properly chargeable to the
income account shall exceed 1/12 of the percentage of average net
assets allowable as expenses, the payment to the Adviser for that
month shall be reduced and if necessary the Adviser shall make a
refund payment to the Fund so that the total net expense will not
exceed such percentage. As of the end of the Fund's fiscal year,
however, the foregoing computations and payments shall be
readjusted so that the aggregate compensation payable to the
Adviser for the year is equal to the percentage set forth in
Section 3 hereof of the average net asset value as determined as
described herein throughout the fiscal year, diminished to the
extent necessary so that the total of the aforementioned expense
items of the Fund shall not exceed the expense limitation. The
aggregate of repayments, if any, by the Adviser to the Fund for
the year shall be the amount necessary to limit the said net
expense to said percentage in accordance with the foregoing.
The net asset value for each Portfolio shall be calculated in
accordance with the provisions of the Fund's prospectus or at
such other time or times as the trustees may determine in
accordance with the provisions of the Investment Company Act of
1940. On each day when net asset value is not calculated, the
net asset value of a share of a Portfolio shall be deemed to be
the net asset value of such a share as of the close of business
on the last day on which such calculation was made for the
purpose of the foregoing computations.
6. Subject to applicable statutes and regulations, it is
understood that trustees, officers or agents of the Fund are or
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may be interested in the Adviser as officers, directors, agents,
shareholders or otherwise, and that the officers, directors,
shareholders and agents of the Adviser may be interested in the
Fund otherwise than as a trustee, officer or agent.
7. The Adviser shall not be liable for any error of judgment or
of law or for any loss suffered by the Fund 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.
8. This Agreement shall become effective with respect to the
Initial Portfolio on the date hereof and shall remain in full
force until December 1, 1996, unless sooner terminated as
hereinafter provided. This Agreement shall continue in force
from year to year thereafter with respect to each Portfolio, but
only as long as such continuance is specifically approved for
each Portfolio at least annually in the manner required by the
Investment Company Act of 1940 and the rules and regulations
thereunder; provided, however, that if the continuation of this
Agreement is not approved for a Portfolio, the Adviser may
continue to serve in such capacity for such Portfolio in the
manner and to the extent permitted by the Investment Company Act
of 1940 and the rules and regulations thereunder.
This Agreement shall automatically terminate in the event of its
assignment and may be terminated at any time without the payment
of any penalty by the Fund or by the Adviser on sixty (60) days
written notice to the other party. The Fund may effect
termination with respect to any Portfolio by action of the Board
of Trustees or by vote of a majority of the outstanding voting
securities of such Portfolio.
This Agreement may be terminated with respect to any Portfolio at
any time without the payment of any penalty by the Board of
Trustees or by vote of a majority of the outstanding voting
securities of such Portfolio in the event that it shall have been
established by a court of competent jurisdiction that the Adviser
or any officer or director of the Adviser has taken any action
which results in a breach of the covenants of the Adviser set
forth herein.
The terms "assignment" and "vote" of a majority of the
outstanding voting securities" shall have the meanings set forth
in the Investment Company Act of 1940 and the rules and
regulations thereunder.
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 3 earned prior to such
termination.
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9. 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.
10. Any notice under this Agreement shall be in writing,
addressed and delivered or mailed, postage prepaid, to the other
party at such address as such other party may designate for the
receipt of such notice.
11. All parties hereto are expressly put on notice of the
Fund's Agreement and Declaration of Trust and all amendments
thereto, all of which are on file with the Secretary of The
Commonwealth of Massachusetts, and the limitation of shareholder
and trustee liability contained therein. This Agreement has been
executed by and on behalf of the Fund by its representatives as
such representatives and not individually, and the obligations of
the Fund hereunder are not binding upon any of the trustees,
officers, or shareholders of the Fund individually but are
binding upon only the assets and property of the Fund. With
respect to any claim by the Adviser for recovery of that portion
of the investment management fee (or any other liability of the
Fund arising hereunder) allocated to a particular Portfolio,
whether in accordance with the express terms hereof or otherwise,
the Adviser shall have recourse solely against the assets of that
Portfolio to satisfy such claim and shall have no recourse
against the assets of any other Portfolio for such purpose.
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12. This Agreement shall be construed in accordance with
applicable federal law and (except as to Section 11 hereof which
shall be construed in accordance with the laws of The
Commonwealth of Massachusetts) the laws of the State of Illinois.
IN WITNESS WHEREOF, the Fund and the Adviser have caused this
Agreement to be executed as of the day and year first above
written.
TAX-EXEMPT CALIFORNIA
MONEY MARKET FUND
By: /s/ Xxxx X. Xxxxxx
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Title: Vice President
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ATTEST:
/s/ Xxxxxx X. Xxxxxxx
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Title: Secretary
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XXXXXX FINANCIAL SERVICES, INC.
By: /s/ Xxxxxxx X. Xxxxxxx
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Title: Senior Vice President
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ATTEST:
/s/ Xxxxx X. Xxxxxxxxxxx
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Title: Assistant Secretary
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