INVESTMENT ADVISORY AGREEMENT
AGREEMENT made as of this 21st day of March, 2006, between WisdomTree
Asset Management, Inc. (the "Adviser") and WisdomTree Trust, a statutory trust
organized under the laws of the State of Delaware (the "Trust").
WHEREAS, the Adviser is principally engaged in the business of rendering
investment management services and is registered as an investment adviser under
the Investment Advisers Act of 1940, as amended (the "Advisers Act"), or will be
so registered prior to the launch of any Initial Fund (as defined below); and
WHEREAS, the Trust proposes to engage in the business of an investment
company and is registered as such under the Investment Company Act of 1940, as
amended (the "1940 Act"); and
WHEREAS, the Trust is authorized to issue shares of beneficial interest in
separate series with each such series representing interests in a separate
portfolio of securities and other assets; and
WHEREAS, the Trust intends initially to offer shares representing
interests in each of the separate series listed on Schedule A attached hereto
(each, an "Initial Fund" and collectively, the "Initial Funds"); and
WHEREAS, the Trust desires to appoint the Adviser to serve as the
investment adviser with respect to each of the Initial Funds; and
WHEREAS, the Trust may, from time to time, offer shares representing
interests in one or more additional series (each, an "Additional Fund" and
collectively, the "Additional Funds"); and
WHEREAS, the Trust may desire to appoint the Adviser as the investment
adviser with respect to one or more of the "Additional Funds" (each such
Additional Fund and Initial Fund being referred to herein individually as a
"Fund" and collectively as the "Funds");
NOW THEREFORE, the parties hereto hereby agree as follows:
1. Appointment of the Adviser
The Trust hereby appoints the Adviser to act as investment adviser for the
Initial Funds for the period and on terms set forth herein. The Adviser accepts
such appointment and agrees to render such services for the compensation set
forth herein. In the event that the Trust desires to retain the Adviser to
render investment advisory services hereunder with respect to an Additional
Fund, and the Adviser is willing to render such services, Schedule A shall be
amended in accordance with Section 10(b) whereupon such Additional Fund shall
become a Fund hereunder.
The Adviser shall be deemed to be an independent contractor and shall, unless
otherwise expressly provided for or authorized, in this Agreement or another
writing by the Trust and the Adviser, have no authority to act for or represent
the Trust in any way or otherwise be deemed an agent of the Trust.
2. Duties of the Adviser
(a) The Trust acknowledges and agrees that it is contemplated that the Adviser
will manage the investment operations and composition of each Fund of the Trust
and render investment advice for each Fund. The Adviser may, at its own expense,
select and contract with one or more investment sub-advisers to manage the
investment operations and composition of each Fund of the Trust and render
investment advice for each Fund. The services provided by the Adviser or any
such sub-adviser shall include: (i) furnishing continuously an investment
program for each Fund; (ii) managing the investment and reinvestment of Fund
assets; (iii) determining which investments shall be purchased, held, sold or
exchanged for each Fund and what portion, if any, of the assets of each Fund
shall be held uninvested; (iv) making changes on behalf of the Trust in the
investments for each Fund; (v) providing the Trust with records concerning the
activities that the Trust is required to maintain; and (vi) rendering reports to
the Trust's officers and Board of Trustees concerning the Adviser's discharge of
the foregoing responsibilities. In addition, the Adviser will arrange for other
necessary services, including custodial, transfer agency and administration. The
Adviser shall furnish to the Trust all office facilities, equipment, services
and executive and administrative personnel necessary for managing the investment
program of the Trust for each Fund. The Adviser may enter into arrangements with
its parent or other persons affiliated or unaffiliated with the Adviser for the
provision of certain personnel and facilities to the Adviser to enable the
Adviser to fulfill its duties and obligations under this Agreement.
(b) The Adviser shall discharge the foregoing responsibilities subject to the
supervision and control of the Board of Trustees of the Trust and in compliance
with such policies as the Trustees may from time to time establish, each Fund's
investment objective and policies as set forth in the then current prospectus
and statement of additional information for such Fund contained in the Trust's
Registration Statement on Form N-1A, as amended or supplemented from time to
time, the Trust's compliance manual, as in effect from time to time, and
applicable laws and regulations.
3. Certain Records and Reports
Any records required to be maintained and preserved pursuant to the provisions
of Rule 31a-1 and Rule 31a-2 under the 1940 Act that are prepared or maintained
by the Adviser (or any investment sub-adviser) on behalf of the Trust are the
property of the Trust and will be surrendered promptly to the Trust at its
request (the "Records"). The Adviser agrees to preserve the Records for the
periods prescribed in Rule 31a-2 under the 1940 Act. The Trust and the Adviser
agree to furnish to each other, if applicable, current prospectuses, proxy
statements, reports to shareholders, certified copies of their financial
statements, and such other information with regard to their affairs as each may
reasonably request. The Adviser shall keep confidential any information obtained
in connection with its duties hereunder and disclose such in formation
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only if the Trust has authorized such disclosure or if such disclosure is
expressly required or lawfully requested by applicable federal or state
regulatory authorities.
4. Advisory Fees/Allocation of Expenses
(a) For the services to be provided by the Adviser hereunder with respect to
each Fund, the Trust shall pay to the Adviser a fee at the rate set forth on
Schedule A attached hereto. Schedule A shall be amended from time to time to
reflect the addition and/or termination of any Fund as a Fund hereunder and to
reflect any change in the advisory fees payable with respect to any Fund duly
approved in accordance with Section 10(b) hereunder. All fees payable hereunder
shall be accrued daily and paid as soon as practical after the last day of each
month.
In any case of commencement or termination of this Agreement with respect to any
Fund during any calendar month, the fee with respect to such Fund for that month
shall be reduced proportionately based upon the number of calendar days during
which it is in effect, and the fee shall be computed upon the average daily net
assets of such Fund for the days during which it is in effect.
(b) The Adviser agrees to pay all expenses of the Trust, except for: (i)
brokerage expenses and other expenses (such as stamp taxes) connected with the
execution of portfolio transactions or in connection with creation and
redemption transactions; (ii) legal fees or expenses in connection with any
arbitration, litigation or pending or threatened arbitration or litigation,
including any settlements in connection therewith; (iii) compensation and
expenses of the Trustees of the Trust who are not officers, directors/trustees,
partners or employees of the Adviser or its affiliates (the "Independent
Trustees"); (iv) compensation and expenses of counsel to the Independent
Trustees, (iv) compensation and expenses of the Trust's chief compliance
officer; (v) extraordinary expenses; (vi) distribution fees and expenses paid by
the Trust under any distribution plan adopted pursuant to Rule 12b-1 under the
1940 Act; and (vii) the advisory fee payable to the Adviser hereunder. The
payment or assumption by the Adviser of any expense of the Trust that the
Adviser is not required by this Agreement to pay or assume shall not obligate
the Adviser to pay or assume the same or any similar expense of the Trust on any
subsequent occasion.
5. Limitation of Liability Under the Declaration of Trust
The Declaration of Trust establishing the Trust provides that no Trustee,
shareholder, officer, employee or agent of the Trust shall be subject to any
personal liability in connection with Trust property or the affairs of the Trust
and that all persons should shall look solely to the Trust property or to the
property of one or more specific Funds for satisfaction of claims of any nature
arising in connection with the affairs of the Trust.
6. Regulation
The Adviser shall submit to all regulatory and administrative bodies having
jurisdiction over the services provided pursuant to this Agreement any
information, reports or other material which
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any such body by reason of this Agreement may request or require pursuant to
applicable laws and regulations.
7. Provision of Certain Information by the Adviser
The Adviser will promptly notify the Trust in writing of the occurrence of any
of the following events:
(a) the Adviser fails to be registered as an investment adviser under the
Advisers Act or under the laws of any jurisdiction in which the Adviser is
required to be registered as an investment adviser in order to perform its
obligations under this Agreement;
(b) the Adviser is served or otherwise receives notice of any action, suit,
proceeding, inquiry or investigation, at law or in equity, before or by any
court, public board or body, involving the affairs of the Trust; and
(c) the chief executive officer or parent company of the Adviser or the
portfolio manager of any Fund changes.
8. Limitation of Liability of the Adviser
Neither the Adviser nor its officers, directors, employees, agents, affiliated
persons or controlling persons or assigns shall be liable for any error of
judgment or mistake of law or for any loss suffered by the Trust or its
shareholders in connection with the matters to which this Agreement relates;
provided that no provision of this Agreement shall be deemed to protect the
Adviser against any liability to the Trust or its shareholders resulting from
any willful misfeasance, bad faith or gross negligence in the performance of its
duties or obligations hereunder, the reckless disregard of its duties or
obligations hereunder, or breach of its fiduciary duty to the Trust, any Fund or
its shareholders.
9. Force Majeure
Notwithstanding any other provision of this Agreement, the Adviser shall not be
liable for any loss suffered by the Trust or its shareholders caused directly or
indirectly by circumstances beyond the Adviser's reasonable control including,
without limitation, government restrictions, exchange or market rulings,
suspensions of trading, acts of civil or military authority, national
emergencies, labor difficulties, fires, earthquakes, floods or other
catastrophes, acts of God, wars, riots or failures of communication or power
supply. In the event of equipment breakdowns beyond its reasonable control, the
Adviser shall take reasonable steps to minimize service interruptions, but shall
have no liability with respect thereto.
10. Duration, Termination and Amendment
(a) Duration. This Agreement shall become effective with respect to each
Initial Fund on the date hereof and, with respect to any Additional Fund, on the
date Schedule A is amended to reflect such Additional Fund in accordance with
paragraph (b) below. Unless terminated in
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accordance with this Section 8, the Agreement shall remain in full force and
effect for two years from the date hereof with respect to each Initial Fund and,
with respect to each Additional Fund, for two years from the date on which such
Fund becomes a Fund hereunder. Subsequent to such initial periods of
effectiveness, this Agreement shall continue in full force and effect for
periods of one year thereafter with respect to each Fund so long as such
continuance with respect to such Fund is specifically approved at least annually
(i) by either the Board of Trustees of the Trust or by vote of a "majority of
the outstanding voting securities" (as defined in the 0000 Xxx) of such Fund,
and (ii) in either event, by the vote of a majority of the Trustees of the Trust
who are not parties to this Agreement or "interested persons" (as defined in the
0000 Xxx) of any such party ("Independent Trustees") cast in person at a meeting
called for the purpose of voting on such approval. If the shareholders of any
Fund fail to approve the Agreement of any continuance of the Agreement as
provided herein, the Adviser may continue to serve hereunder in the manner and
to the extent permitted by the 1940 Act and rules and regulations thereunder.
The foregoing requirement that continuance of this Agreement be "specifically
approved at least annually" shall be construed in a manner consistent with the
1940 Act and the rules and regulations thereunder.
(b) Amendment. Any amendment to this Agreement that is material shall become
effective with respect to a Fund only upon approval of the Adviser, the Board of
Trustees of the Trust, including a majority of the Independent Trustees of the
Trust cast in person at a meeting called for the purpose of voting such approval
and, if required under the 1940 Act, a majority of the outstanding voting
securities (as defined in the 0000 Xxx) of the Fund.
c. Approval, Amendment or Termination by a Fund. Any approval, amendment or
termination of this Agreement with respect to a Fund will not require the
approval of a majority of the outstanding voting securities of any other Fund or
the approval of a majority of the outstanding voting securities of the Trust,
unless such approval is required by applicable law.
d. Automatic Termination. This Agreement shall automatically and immediately
terminate in the event of its "assignment" (as defined in the 1940 Act).
e. Termination. This Agreement may be terminated with respect to any Fund at
any time, without payment of any penalty, by vote of the Board of Trustees of
the Trust, including a majority of the Independent Trustees of the Trust, or by
vote of a majority of the outstanding voting securities (as defined in the 0000
Xxx) of that Fund, or by the Adviser, in each case on not less than 30 days' nor
more than 60 days' prior written notice to the other party; provided, that a
shorter notice period shall be permitted for a Fund in the event its shares are
no longer listed on a national securities exchange.
11. Services Not Exclusive
The services of the Adviser to the Trust hereunder are not to be deemed
exclusive, and the Adviser shall be free to render similar services to others
(including other investment companies and to engage in other activities) so long
as its services hereunder are not impaired thereby.
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12. Miscellaneous
(a) Notice. All notices required to be given pursuant to this Agreement shall
be delivered or mailed to the last known business address of the Trust or the
Adviser in person or by registered mail or a private mail or delivery service
providing the sender with notice of receipt. Notice shall be deemed given on the
date delivered or mailed in accordance with this section. A copy of any notice
given to the Trust shall be delivered to: Xxxxxx X. Xxxxxxx, Xx., Xxxxxxxxxxx &
Xxxxxxxx Xxxxxxxxx Xxxxxx LLP, 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000-0000.
(b) Severability. Should any portion of this Agreement for any reason be held
to be void in law or in equity, the Agreement shall be construed, insofar as is
possible, as if such portion had never been contained herein.
(c) Applicable Law. This Agreement shall be construed in accordance with and
governed by the laws of the State of Delaware (without giving effect to its
conflict of law principles) and the applicable provisions of the 1940 Act. To
the extent that the applicable laws of the State of Delaware, or any of the
provisions herein, conflict with the applicable provisions of the 1940 Act, the
latter shall control.
(d) Execution By Counterpart. This Agreement may be executed in any number of
counterparts, all of which together shall constitute one agreement.
(e) Survival After Termination. The rights and obligations set forth in
Sections 5 and 8 shall survive the termination of this Agreement.
(f) Permissible Interests. Trustees, officers, agents and shareholders of the
Trust are or may be interested in the Adviser (or any successor thereof) as
directors, partners, officers, agents, shareholders or otherwise; directors,
partners, officers, agents and shareholders of the Adviser are or may be
interested in the Trust as Trustees, officers, agents, shareholders or
otherwise; and the Adviser (or any successor thereof) is or may be interested in
the Trust as a shareholder or otherwise.
(g) Entire Agreement. This Agreement contains the entire understanding and
agreement of the parties.
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IN WITNESS WHEREOF, the parties hereto have caused this agreement to
be executed as of the date first set forth above.
WISDOMTREE TRUST
By: _____________________
Name: Xxxxxxxx Xxxxxxxxx
Title: President
WISDOMTREE ASSET MANAGEMENT, INC.
By: ____________________
Name: Xxxxxxxx Xxxxxxxxx
Title: President
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Schedule A
to the Investment Advisory Agreement
Dated June 12, 2006
between WisdomTree Trust
and WisdomTree Asset Management, Inc.
Name of Series Fee
Name of Series Fee
-------------- ---
WisdomTree Total Dividend Fund 0.28%
WisdomTree High-Yielding Equity (SM) Fund 0.38%
WisdomTree LargeCap Dividend Fund 0.28%
WisdomTree Dividend Top 100 (SM) Fund 0.38%
WisdomTree MidCap Dividend Fund 0.38%
WisdomTree SmallCap Dividend Fund 0.38%
WisdomTree DIEFA (SM) Fund 0.48%
WisdomTree DIEFA High-Yielding Equity Fund 0.58%
WisdomTree Europe Total Dividend Fund 0.48%
WisdomTree Europe High-Yielding Equity Fund 0.58%
WisdomTree Europe SmallCap Dividend Fund 0.58%
WisdomTree Japan Total Dividend Fund 0.48%
WisdomTree Japan High-Yielding Equity Fund 0.58%
WisdomTree Japan SmallCap Dividend Fund 0.58%
WisdomTree Pacific ex-Japan Total Dividend Fund 0.48%
WisdomTree Pacific ex-Japan High-Yielding Equity Fund 0.58%
WisdomTree International LargeCap Dividend Fund 0.48%
WisdomTree International Dividend Top 100 (SM) Fund 0.58%
WisdomTree International MidCap Dividend Fund 0.58%
WisdomTree International SmallCap Dividend Fund 0.58%
WisdomTree International Basic Materials Sector Fund 0.58%
WisdomTree International Communications Sector Fund 0.58%
WisdomTree International Consumer Cyclical Sector Fund 0.58%
WisdomTree International Consumer Non-Cyclical Sector Fund 0.58%
WisdomTree International Energy Sector Fund 0.58%
WisdomTree International Financial Sector Fund 0.58%
WisdomTree International Health Care Sector Fund 0.58%
WisdomTree International Industrial Sector Fund 0.58%
WisdomTree International Technology Sector Fund 0.58%
WisdomTree International Utilities Sector Fund 0.58%
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