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EXHIBIT (d)(xxii)
MERGERS AND ACQUISITIONS FUND
OF
THE ENTERPRISE GROUP OF FUNDS, INC.
FUND MANAGER'S AGREEMENT
THIS AGREEMENT, made the 28th day of February, 2001 is among The
Enterprise Group of Funds, Inc (the "Fund"), a Maryland corporation, Enterprise
Capital Management, Inc., a Georgia corporation (hereinafter referred to as the
"Adviser"), and GAMCO Investors, Inc., a New York corporation, (hereinafter
referred to as the "Fund Manager").
BACKGROUND INFORMATION
(A) The Adviser has entered into an Investment Adviser's
Agreement dated as of July 1, 1999 with the Fund ("Investment Adviser's
Agreement"). Pursuant to the Investment Adviser's Agreement, the Adviser has
agreed to render investment advisory and certain other management services to
all of the Portfolios of the Fund, and the Fund has agreed to employ the
Adviser to render such services and to pay to the Adviser certain fees
therefore. The Investment Adviser's Agreement recognizes that the Adviser may
enter into agreements with other investment advisers who will serve as Fund
Managers to the Portfolios.
(B) The parties hereto wish to enter into an agreement whereby
the Fund Manager will provide to the Mergers and Acquisitions Portfolio of the
Fund (the "Mergers and Acquisitions Fund") securities investment advisory
services for the Mergers and Acquisitions Fund.
WITNESSETH THAT:
In consideration of the mutual covenants herein contained, the Fund,
Adviser and the Fund Manager agree as follows:
(1) The Fund and Adviser hereby employ the Fund Manager
to render certain investment advisory services to the Mergers and Acquisitions
Fund, as set forth herein. The Fund Manager hereby accepts such employment and
agrees to perform such services on the terms herein set forth, and for the
compensation herein provided.
(2) The Fund Manager shall furnish the Mergers and
Acquisitions Fund advice with respect to the investment and reinvestment of the
assets of the Mergers and Acquisitions Fund, or such portion of the assets of
the Mergers and Acquisitions Fund as the Adviser shall specify from time to
time, in accordance with the investment objectives, restrictions and
limitations of the Mergers and Acquisitions Fund which are set forth in the
Fund's most recent Registration Statement. The Fund Manager may delegate its
investment advisory and other responsibilities and duties hereunder to an
affiliated person of the Fund Manager, subject to the Fund Manager retaining
overall responsibility for such powers and functions and any and all
obligations and liabilities in connection therewith.
(3) The Fund Manager shall perform a monthly
reconciliation of the Mergers and Acquisitions Fund to the holdings report
provided by the Fund's custodian and bring any material or significant
variances regarding holdings or valuations to the attention of the Adviser.
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(4) The Fund Manager shall for all purposes herein be
deemed to be an independent contractor. The Fund Manager has no authority to
act for or represent the Fund or the Portfolios in any way except to direct
securities transactions pursuant to its investment advice hereunder. The Fund
Manager is not an agent of the Fund or the Portfolios.
(5) It is understood that the Fund Manager does not, by
this Agreement, undertake to assume or pay any costs or expenses of the Fund or
the Portfolios.
(6)(a) The Adviser agrees to pay the Fund Manager for its
services to be furnished under this Agreement, with respect to each calendar
month after the effective date of the Agreement, on the twentieth (20th) day
after the close of each calendar month, a sum equal to 0.0375 of 1% of the
average of the daily closing net asset value of the Portfolio managed by the
Fund Manager during such month (that is, .45 of 1% per year) for the first
$100,000,000 of assets under management and a sum equal to 0.0333 of 1% of the
average of the daily closing net asset value of the Portfolio during such month
(that is, 0.40 of 1% per year) thereafter.
(6)(b) The payment of all fees provided for hereunder shall
be prorated and reduced for sums payable for a period less than a full month in
the event of termination of this Agreement on a day that is not the end of a
calendar month.
(6)(c) For the purposes of this Paragraph 6, the daily
closing net asset values of the Portfolio shall be computed in the manner
specified in the Registration Statement for the computation of the value of
such net assets in connection with the determination of the net asset value of
the Mergers and Acquisitions Fund's shares.
(7) The services of the Fund Manager hereunder are not
to be deemed to be exclusive, and the Fund Manager is free to render services
to others and to engage in other activities so long as its services hereunder
are not impaired thereby. Without in any way relieving the Fund Manager of its
responsibilities hereunder, it is agreed that the Fund Manager may employ
others to furnish factual information, economic advice and/or research, and
investment recommendations, upon which its investment advice and service is
furnished hereunder.
(8) In the absence of willful misfeasance, bad faith or
gross negligence in the performance of its duties hereunder, or reckless
disregard of its obligations and duties hereunder, the Fund Manager shall not
be liable to the Fund, the Mergers and Acquisitions Fund or the Adviser or to
any shareholder or shareholders of the Fund, the Mergers and Acquisitions Fund
or the Adviser for any mistake of judgment, act or omission in the course of,
or connected with, the services to be rendered by the Fund Manager hereunder.
(9) The Fund Manager will take necessary steps to
prevent the investment professionals of the Fund Manager and affiliated persons
of the Fund Manager who are responsible for investing assets of the Mergers and
Acquisitions Fund from taking, at any time, a short position in any shares of
any holdings of any Portfolio of the Fund for any accounts in which such
individuals have a beneficial interest, excluding short positions, including
without limitation, short against-the-box positions, effected for tax reasons.
The Fund Manager also will cooperate with the Fund in adopting a written policy
prohibiting xxxxxxx xxxxxxx with respect to Mergers and Acquisitions Fund
transactions insofar as such transactions may relate to the Fund Manager.
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(10) In connection with the management of the investment
and reinvestment of the assets of the Mergers and Acquisitions Fund, the Fund
Manager is authorized to select the brokers or dealers that will execute
purchase and sale transactions for the Mergers and Acquisitions Fund, and is
directed to use its best efforts to obtain the best available price and most
favorable execution with respect to such purchases and sales of portfolio
securities for the Mergers and Acquisitions Fund. Subject to this primary
requirement, and maintaining as its first consideration the benefits for the
Mergers and Acquisitions Fund and its shareholders, the Fund Manager shall have
the right, subject to the approval of the Board of Directors of the Fund and of
the Adviser, to follow a policy of selecting brokers and dealers who furnish
statistical research and other services to the Mergers and Acquisitions Fund,
the Adviser, or the Fund Manager and, subject to the Conduct Rules of the
National Association of Securities Dealers, Inc., to select brokers and dealers
who sell shares of Portfolio of the Fund.
(11) The Fund may terminate this Agreement by thirty days
written notice to the Adviser and the Fund Manager at any time, without the
payment of any penalty, by vote of the Fund's Board of Directors, or by vote of
a majority of its outstanding voting securities. The Adviser may terminate this
Agreement by thirty days written notice to the Fund Manager and the Fund
Manager may terminate this Agreement by thirty days written notice to the
Adviser, without the payment of any penalty. This Agreement shall immediately
terminate in the event of its assignment, unless an order is issued by the
Securities and Exchange Commission conditionally or unconditionally exempting
such assignment from the provision of Section 15 (a) of the Investment Company
Act of 1940, in which event this Agreement shall remain in full force and
effect.
(12) Subject to prior termination as provided above, this
Agreement shall continue in force from the date of execution until February 28,
2003 and from year to year thereafter if its continuance after said date: (1)
is specifically approved on or before said date and at least annually
thereafter by vote of the Board of Directors of the Fund, including a majority
of those directors who are not parties to this Agreement of interested persons
of any such party, or by vote of a majority of the outstanding voting
securities of the Fund, and (2) is specifically approved at least annually by
the vote of a majority of directors of the Fund who are not parties to this
Agreement or interested persons of any such party cast in person at a meeting
called for the purpose of voting on such approval.
(13) The Adviser shall indemnify and hold harmless the
Fund Manager, its officers and directors and each person, if any, who controls
the Fund Manager within the mowing of Section 15 of the Securities Act of 1933
(any and all such persons shall be referred to as "Indemnified Party"), against
any loss, liability, claim, damage or expense (including the reasonable cost of
investigating or defending any alleged loss, liability, claim, damages or
expense and reasonable counsel fees incurred in connection therewith), arising
by reason of any matter to which this Fund Manager's Agreement relates.
However, in no case (i) is this indemnity to be deemed to protect any
particular Indemnified Party against any liability to which such Indemnified
Party would otherwise be subject by reason of willful misfeasance, bad faith or
gross negligence in the performance of its duties or by reason of reckless
disregard of its obligations and duties under this Fund Manager's Agreement or
(ii) is the Adviser to be liable under this indemnity with respect to any claim
made against any particular Indemnified Party unless such Indemnified Party
shall have notified the Adviser in writing within a reasonable time after the
summons or other first legal process giving information of the nature of the
claim shall have been served upon the Fund Manager or such controlling persons.
The Fund Manager shall indemnify and hold harmless the Adviser and
each of its directors and officers and each person if any who controls the
Adviser within the meaning of Section 15 of the Securities Act of 1933, against
any loss, liability, claim, damage or expense described in the foregoing
indemnity, but only with respect to the Fund Manager's willful misfeasance, bad
faith or gross
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negligence in the performance of its duties under this Fund Manager's
Agreement. In case any action shall be brought against the Adviser or any
person so indemnified, in respect of which indemnity may be sought against the
Fund Manager, the Fund Manager shall have the rights and duties given to the
Adviser, and the Adviser and each person so indemnified shall have the rights
and duties given to the Fund Manager by the provisions of subsection (i) and
(ii) of this paragraph 13.
(14) Except as otherwise provided in paragraph 13 hereof
and as may be required under applicable federal law, this Fund Manager's
Agreement shall be governed by the laws of the State of Georgia.
(15) The Fund Manager agrees to notify the parties within
a reasonable period of time regarding a material change in the membership of
the Fund Manager.
(16) The terms "vote of a majority of the outstanding
voting securities," "assignment" and "interested persons," when used herein,
shall have the respective meanings specified in the Investment Company Act of
1940 as now in effect or as hereafter amended.
(17) Unless otherwise permitted, all notices,
instructions and advice with respect to security transactions or any other
matters contemplated by this Agreement shall be deemed duly given when received
in writing:
by the Fund Manager: GAMCO Investors, Inc.
Xxx Xxxxxxxxx Xxxxxx
Xxx, XX 00000
by the Adviser: Enterprise Capital Management, Inc.
0000 Xxxxxxxxx Xxxx, X.X., Xxxxx 000
Xxxxxxx, XX 00000-0000
by the Fund: The Enterprise Group of Funds, Inc.
c/o Enterprise Capital Management, Inc.
0000 Xxxxxxxxx Xxxx, X.X., Xxxxx 000
Xxxxxxx, XX 00000-0000
or by such other person or persons at such address or addresses as shall be
specified by the applicable party, in each case, in a notice similarly given.
Each party may rely upon any notice or other communication from the other
reasonably believed by it to be genuine.
(18) This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original and all of which,
when taken together, shall constitute one and the same agreement.
(19) This Agreement constitutes the entire agreement
between the Fund Manager, the Adviser and the Fund relating to the Mergers and
Acquisitions Fund.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be
signed by their duly authorized officers and their corporate seals hereunder
duly affixed and attested, as of the date first above written.
THE ENTERPRISE GROUP OF FUNDS, INC.
(SEAL) By: /s/ XXXXXX XXXXXX
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Xxxxxx Xxxxxx
Chairman, President and CEO
ATTEST: /s/ XXXXXXXXX X XXXXXXXXX
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Secretary
ENTERPRISE CAPITAL MANAGEMENT, INC.
(SEAL)
By: /s/ XXXXXX XXXXXX
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Xxxxxx Xxxxxx
Chairman, President and CEO
ATTEST: /s/ XXXXXXXXX X XXXXXXXXX
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GAMCO INVESTORS, INC.
(SEAL)
By: /s/ XXXXXXX X. XXXXXXXX
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ATTEST:
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