, dated as of October 22, 1997, by and between Domini
Social Equity Fund, a Massachusetts business trust (the "Trust"), and Domini
Social Investments LLC, a Massachusetts limited liability company ("DSI" or the
"Sponsor").
W I T N E S S E T H:
WHEREAS, the Trust is engaged in business as an open-end investment company
registered under the Investment Company Act of 1940, as amended, and consists of
one or more series; and
WHEREAS, the Trust desires to enter into this Agreement with respect to its
current and future series; and
WHEREAS, the Trust wishes to engage DSI to provide certain oversight,
administrative and management services, and DSI is willing to provide such
oversight, administrative and management services to the Trust on the terms and
conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the mutual covenants and agreements of
the parties hereto as herein set forth, the parties covenant and agree as
follows:
1. DUTIES OF THE SPONSOR. Subject to the direction and control of the
Board of Trustees of the Trust, the Sponsor shall perform such oversight,
administrative and management services as may from time to time be reasonably
requested by the Trust, which shall include without limitation: (a) maintaining
office facilities (which may be in the office of DSI or an affiliate) and
furnishing clerical services necessary for maintaining the organization of the
Trust and for performing the oversight, administrative and management functions
herein set forth; (b) arranging, if desired by the Trust, for directors,
officers or employees of the Sponsor to serve as Trustees, officers or agents of
the Trust if duly elected or appointed to such positions and subject to their
individual consent and to any limitations imposed by law; (c) supervising the
overall administration of the Trust, including the updating of corporate
organizational documents, and the negotiation of contracts and fees with and the
monitoring and coordinating of performance and xxxxxxxx of the Trust's transfer
agent, shareholder servicing agents (if any), custodian, administrator,
subadministrator (if any) and other independent contractors or agents; (d)
overseeing (with advice of the Trust's counsel) the preparation of and, if
applicable, filing all documents required for compliance by the Trust with
applicable laws and regulations (including state "blue sky" laws and
regulations), including registration statements on Form N-1A, prospectuses and
statements of additional information, or similar forms, as applicable,
semi-annual and annual reports to shareholders and proxy statements, and
reviewing tax returns; (e) preparation of agendas and supporting documents for
and minutes of meetings of Trustees, committees of Trustees and preparation of
notices, proxy statements and minutes of meetings of shareholders; (f) arranging
for maintenance of books and records of the Trust; (g) maintaining telephone
coverage to respond to shareholder inquiries regarding matters to which this
Agreement pertains to which the transfer agent is unable to respond; (h)
providing reports and assistance regarding each series' compliance with
securities and tax laws and each series' investment objectives; (i) arranging
for dissemination of yield and other performance information to newspapers and
tracking services; (j) arranging for and preparing annual renewals for fidelity
bond and errors and omissions insurance coverage; (k) developing a budget for
the Trust, establishing the rate of expense accruals and arranging for the
payment of all fixed and management expenses; and (l) answering questions from
the general public, the media and investors in the Trust regarding (i) the
securities holdings of the Trust; (ii) any limits in which the Trust invests;
(iii) the social investment philosophy of the Trust; and (iv) the proxy voting
philosophy and shareholder activism philosophy of the Trust. Notwithstanding
the foregoing, the Sponsor shall not be deemed to have assumed, pursuant to this
Agreement, any duties with respect to, and shall not be responsible for, the
management of the Trust's assets or the rendering of investment advice and
supervision with respect thereto or the distribution of shares of any series,
nor shall the Sponsor be deemed to have assumed or have any responsibility with
respect to functions specifically assumed by any transfer agent, custodian, fund
accounting pricing agent or shareholder servicing agent of the Trust.
2. ALLOCATION OF CHARGES AND EXPENSES. DSI shall pay the entire salaries
and wages of all of the Trust's Trustees, officers and agents who devote part or
all of their time to the affairs of DSI or its affiliates, and the wages and
salaries of such persons shall not be deemed to be expenses incurred by the
Trust for purposes of this Section 2. The Trust shall pay all of its operating
expenses, including but not limited to fees due the Sponsor under this
Agreement, compensation of Trustees not affiliated with the Sponsor,
governmental fees, including but not limited to Securities and Exchange
Commission fees and state "blue sky" fees; interest charges; taxes and related
charges; membership dues of the Trust in the Investment Company Institute and
other professional or industry associations; fees and expenses of the Trust's
independent auditors and accountants, of legal counsel and any transfer agent,
distributor, shareholder servicing agent, recordkeeper, registrar or dividend
disbursing agent of the Trust; expenses of distributing, issuing and redeeming
shares and servicing shareholder accounts; expenses of preparing, printing and
mailing prospectuses and statements of additional information, reports, notices,
proxy statements and reports to shareholders and governmental officers and
commissions; expenses connected with the execution, recording and settlement of
portfolio security transactions; insurance premiums; fees and expenses of the
Trust's custodian for all services to the Trust, including safekeeping of funds
and securities and maintaining required books and accounts; expenses of
calculating the net asset value of shares of the Trust; expenses of shareholder
meetings; and expenses relating to the issuance, registration and qualification
of shares of any series of the Trust.
3. COMPENSATION OF THE SPONSOR. For the services to be rendered and
facilities to be provided by the Sponsor hereunder, the Trust shall pay DSI a
fee accrued daily and payable monthly at an annual rate equal to 0.50% of the
Trust's average daily net assets for the Trust's then current fiscal year;
provided, however, for a period of one year from the date of this
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Agreement, the fee payable to DSI shall be the lesser of (i) 0.50% of the
Trust's average daily net assets for the Trust's then-current fiscal year and
(ii) the percentage obtained by deducting from 0.98%, the Trust's annual
operating expenses, including the Trust's allocable share of the operating
expenses of the Domini Social Index Portfolio but excluding amounts payable
under this Agreement and brokerage fees and commissions, interest, taxes and any
other extraordinary expenses of the Trust, expressed as a percentage of the
Trust's average daily net assets. If DSI serves as the Sponsor for less than
the whole of any period specified in this Section 3, the compensation to DSI, as
Sponsor, shall be prorated. For purposes of computing the fees payable to the
Sponsor hereunder, the value of the Trust's net assets shall be computed in the
manner specified in the Trust's then-current prospectus and statement of
additional information.
4. LIMITATION OF LIABILITY OF THE SPONSOR. The Sponsor shall not be
liable for any error of judgment or mistake of law or for any act or omission in
the oversight, administration or management of the Trust or the performance of
its duties hereunder, except for willful misfeasance, bad faith or gross
negligence in the performance of its duties, or by reason of the reckless
disregard of its obligations and duties hereunder. As used in this Section 4,
the term "Sponsor" shall include DSI and/or any of its affiliates and the
directors, officers and employees of DSI and/or any of its affiliates.
5. ACTIVITIES OF THE SPONSOR. The services of the Sponsor to the Trust
are not to be deemed to be exclusive, DSI being free to render oversight,
administrative and/or other services to other parties. It is understood that
Trustees, officers and shareholders of the Trust are or may become interested in
the Sponsor and/or any of its affiliates as directors, officers, employees or
otherwise and that directors, officers and employees of the Sponsor and/or any
of its affiliates are or may become similarly interested in the Trust and that
the Sponsor and/or any of its affiliates may be or become interested in the
Trust as a shareholder or otherwise.
6. DURATION, TERMINATION AND AMENDMENTS OF THIS AGREEMENT. This Agreement
shall become effective as of the day and year first above written and shall
govern the relations between the parties hereto thereafter, unless terminated as
set forth in this Section 6.
This Agreement may not be altered or amended, except by an instrument in
writing and executed by both parties. This Agreement may be terminated at any
time, without the payment of any penalty, with respect to any series or the
Trust, by the Board of Trustees of the Trust, or by the Sponsor, in each case on
not less than 60 days' written notice to the other party.
7. SUBCONTRACTING BY DSI. DSI may subcontract for the performance of some
or all of DSI's obligations hereunder with any one or more persons; provided,
however, that DSI shall not enter into any such subcontract unless the Trustees
of the Trust shall have found the subcontracting party to be qualified to
perform the obligations sought to be subcontracted; and provided, further, that,
unless the Trust otherwise expressly agrees in writing, DSI shall be as
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fully responsible to the Trust for the acts and omissions of any subcontractor
as it would be for its own acts or omissions.
8. SEVERABILITY. If any provision of this Agreement shall become or shall
be found to be invalid by a court decision, statute, rule or otherwise, the
remainder of this Agreement shall not be affected thereby.
9. NOTICE. Any notices under this Agreement shall be in writing addressed
and delivered personally, by telecopy or mailed postage-paid to the other party
at such address as such other party may designate in accordance with this
Section 9 for the receipt of such notice. Until further notice to the other
party, it is agreed that the address of the Trust shall be 00 Xxxx 00xx Xxxxxx,
0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, and the address of DSI shall be 00 Xxxx
00xx Xxxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000.
10. MISCELLANEOUS. Each party agrees to perform such further actions and
execute such further documents as are necessary to effectuate the purposes
hereof. This Agreement shall be construed and enforced and interpreted in
accordance with and governed by the laws of the Commonwealth of Massachusetts
without reference to principles of conflicts of law. The captions in this
Agreement are included for convenience only and in no way define or delimit any
of the provisions hereof or otherwise affect their construction or effect. This
Agreement may be executed in any number of counterparts, each of which shall be
deemed to be an original, but such counterparts shall, together, constitute only
one instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered in their names and on their behalf by the undersigned,
thereunto duly authorized, all as of the day and year first above written. The
undersigned Trustee of the Trust has executed this Agreement not individually
but as a Trustee under the Trust's Declaration of Trust, dated June 7, 1989, as
amended, and the obligations of this Agreement are not binding upon any of the
Trustees or shareholders of the Trust individually but bind only the Trust
estate.
DOMINI SOCIAL EQUITY FUND
By /s/ Xxx X. Xxxxxx
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Xxx X. Xxxxxx
Trustee
DOMINI SOCIAL INVESTMENTS LLC
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By /s/ Xxx X. Xxxxxx
-------------------------------------
Xxx X. Xxxxxx
Manager
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