INVESTMENT ADVISORY AGREEMENT
AGREEMENT made this 18th day of July, 1988 by and between XXXX XXXXX
FUND ADVISER, INC. ("Manager"), a Maryland corporation, and WESTERN ASSET
MANAGEMENT COMPANY ("Western"), a California corporation, each of which is
registered as an investment adviser under the Investment Advisers Act of 1940.
WHEREAS, Manager is the manager of Xxxx Mason Cash Reserve Trust (the
"Fund"), an open-end, diversified, management investment company registered
under the Investment Company Act of 1940, as amended (the "1940 Act"), and
WHEREAS, Manager wishes to retain Western to provide it with certain
investment advisory services in connection with Manager's management of the
Fund; and
WHEREAS, Western is willing to furnish such services on the terms and
conditions hereinafter set forth:
NOW, THEREFORE, in consideration of the promises and mutual covenants
herein contained, it is agreed between the parties hereto as follows:
1. Appointment. Manager hereby appoints Western investment adviser for
the Fund for the period and on the terms set forth in this Agreement. Western
accepts such appointment and agrees to furnish the services herein set forth for
the compensation herein provided.
2. Delivery of Documents. Manager has furnished Western with copies
properly certified or authenticated of each of the following:
(a) The Fund's Declaration of Trust, as filed with the
Massachusetts Secretary of State on July 24, 1978 and all
amendments thereto (such Declaration of Trust, as
presently in effect and as it shall from time to time be
amended, is herein called the "Declaration");
(b) The Fund's By-Laws and all amendments thereto (such
By-Laws, as presently in effect and as they shall from
time to time be amended, are herein called the "By-Laws");
(c) Resolutions of the Fund's Board of Trustees authorizing
the appointment of Manager as the manager and Western as
investment adviser and approving the Management Agreement
between Manager and the Fund dated July 18, 1988 (the
"Management Agreement") and this Agreement;
(d) The Fund's Notification of Registration on Form N-8A under
the 1940 Act as filed with the Securities and Exchange
Commission on July 27, 1978 and all amendments thereto;
(e) The Fund's Registration Statement on Form N-1 under the
Securities Act of 1933, as amended, and the 1940 Act (File
No. 811-2853) as filed with the
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Securities and Exchange Commission on September 27, 1978,
including all exhibits thereto, relating to shares of the
Fund's beneficial interest without par value (herein
called "Shares") and all amendments thereto; and
(f) The Fund's most recent prospectus (such prospectus, as
presently in effect and all amendments and supplements
thereto is herein called the "Prospectus").
(g) The Fund's most recent statement of additional information
(suchdocument as presently in effect and all amendments
and supplements thereto is herein called the "Statement of
Additional Information").
Manager will furnish Western from time to time with copies, properly
certified or authenticated, of all amendments of or supplements to the
foregoing.
3. (a) Investment Advisory Services. Subject to the supervision of the
Fund's Board of Trustees and Manager, Western shall regularly provide the Fund
with investment research, advice, management and supervision and shall furnish a
continuous investment program for the Fund's portfolio of securities consistent
with the Fund's investment objective, policies, and limitations as stated in the
minutes of the Fund's Trustees, including the formulation, from time to time, of
lists of specific approved investments for the Fund. Western shall
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determine from time to time what securities shall be purchased, retained or sold
by the Fund, and shall implement those decisions, all subject to the provisions
of the Fund's Declaration of Trust and By-Laws, the 1940 Act, the applicable
rules and regulations of the Securities and Exchange Commission, and other
applicable federal and state law, as well as the investment objective, policies,
and limitations of the Fund. Western will place orders pursuant to its
investment determinations for the Fund either directly with the issuer or with
any broker or dealer. In placing orders with brokers and dealers, Western will
attempt to obtain the best net price and the most favorable execution of its
orders; however, Western may, in its discretion, purchase and sell portfolio
securities from and to brokers and dealers who provide the Fund with research,
analysis, advice and similar services, and Western may pay to these brokers, in
return for research and analysis, a higher commission than may be charged by
other brokers. In no instance will portfolio securities be purchased from or
sold to Western or any affiliated person thereof except in accordance with the
rules, regulations or orders promulgated by the Securities and Exchange
Commission pursuant to the 1940 Act. Western shall also perform such other
functions of management and supervision as may be requested by the Manager and
agreed to by Western.
(b) Western will oversee the maintenance of all books and records with
respect to the securities transactions of the Fund in accordance with all
applicable federal and state laws and
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regulations, and will furnish Manager or the Fund's Board of Trustees of the
Fund with such daily, periodic and special reports as either may request.
4. Services Not Exclusive. Western's services hereunder are not deemed
to be exclusive, and Western shall be free to render similar services to others.
It is understood that persons employed by Western to assist in the performance
of its duties hereunder might not devote their full time to such service.
Nothing herein concerned shall be deemed to limit or restrict the right of
Western or any affiliate of Western to engage in and devote time and attention
to other businesses or to render services of whatever kind or nature.
5. Books and Records. In compliance with the requirements of Rule 31a-3
under the 1940 Act, Western hereby agrees that all records which it maintains
for the Fund are property of the Fund and further agrees to surrender promptly
to the Fund any of such records upon the Fund's request. Western further agrees
to preserve for the periods prescribed by Rule 31a-2 under the 1940 Act, any
such records required to be maintained by Rule 31a-1 under the 1940 Act.
6. Expenses. During the term of this Agreement, Western will pay all
expenses incurred by it in connection with its services under this Agreement
other than the cost of securities (including brokerage commissions, if any)
purchased for the Fund.
7. Compensation. For the services which Western will render to Manager
under this Agreement, Manager will pay Western
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a fee, computed daily and paid monthly, at an annual rate equal to 30 percent of
the amount, net of the Manager's monthly payments to The Standard Fire Insurance
Company for transition services, that the Manager receives from the Fund
pursuant to the Management Agreement. Fees with regard to the Fund shall be paid
promptly following the end of each calendar month. If this Agreement is
terminated as of any date not the last day of a calendar month, a final fee with
regard to the Fund shall be paid promptly after the date of termination and
shall be based only on the average daily net assets of the fund in that period
from the beginning of such month to such date of termination. The average daily
net assets of the Fund shall in all cases be based only on business days and be
computed as of such time and in such manner as may be determined by the Board of
Trustees of the Fund.
8. Limitation of Liability. Western will not be liable for any error of
judgment or mistake of law or for any loss suffered by Manager or by the Fund in
connection with the performance of this Agreement, except a loss resulting from
a breach of fiduciary duty with respect to the receipt of compensation for
services or a loss resulting from willful misfeasance, bad faith or gross
negligence on its part in the performance of its duties or from reckless
disregard by it of its obligations or duties under this Agreement.
9. Definitions. As used in this Agreement, the terms "assignment,"
"interested person," and "majority of the outstanding voting securities" shall
have the meanings given to
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them by Section 2(a) of the 1940 Act, subject to such exemptions as may be
granted by the Securities and Exchange Commission by any rule, regulation or
order.
10. Duration and Termination. This Agreement will become effective on
the date first written above, provided that it shall have been approved by the
Fund's Board of Trustees and by the shareholders of the Fund in accordance with
the requirements of the 1940 Act and, unless sooner terminated as provided for
herein, will continue in effect for two years from the above written date.
Thereafter, if not terminated, this Agreement shall continue in effect for
successive annual periods ending on the same date of each year, provided that
such continuance is specifically approved at least annually (i) by the Fund's
Board of Trustees or (ii) by a vote of a majority of the outstanding voting
securities of the Fund (as defined in the 1940 Act), provided that in either
event the continuance is also approved by a majority of the Fund's Trustees who
are not interested persons (as defined in the 0000 Xxx) of any party to this
Agreement, by vote cast in person at a meeting called for the purpose of voting
on such approval.
This Agreement is terminable without penalty by the Fund's Board of
Trustees, by vote of a majority of the outstanding voting securities of the Fund
(as defined in the 1940 Act), by Manager or by Western, on not less than 60
days' notice to the Fund and/or the other party(ies) and will be terminated
immediately upon any termination of the Management Agreement with
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respect to the Fund or upon the mutual written consent of Western, the Manager,
and the Fund. This Agreement will also automatically and immediately terminate
in the event of its assignment.
11. Further Actions. Each party agrees to perform such further acts and
execute such further documents as are necessary to effectuate the purposes
hereof.
12. Amendments. No provision of this Agreement may be changed, waived,
discharged or terminated orally, but only by an instrument in writing signed by
the party against which enforcement of the change, waiver, discharge or
termination is sought, and no material amendment of this Agreement shall be
effective until approved by vote of the holders of a majority of the Fund's
outstanding voting securities.
13. Miscellaneous. This Agreement embodies the entire agreement and
understanding between the parties hereto, and supersedes all prior agreements
and understandings relating to the subject matter hereof. The captions in this
Agreement are included for convenience of reference only and in no way define or
delimit any of the provisions hereof or otherwise affect their construction or
effect. Should any part of this Agreement 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 and shall inure to the
benefit of the parties hereto and their respective successors and shall be
governed by Maryland law.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their officers designated below on the day and year first above
written.
[SEAL] XXXX XXXXX FUND ADVISER, INC.
Attest:
By: /s/ Xxxxxxx X. Xxxxx By: /s/ Xxxxxxxx X. Xxxxxxxx
________________________ _____________________________
[SEAL] WESTERN ASSET MANAGMENT COMPANY
Attest:
By: /s/ Xxxxxx Xxxxxx-Xxx By: /s/ W. Xxxxxx Xxxxxxxxxx, III
________________________ _____________________________
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