EXHIBIT 4(a)
MANAGEMENT AGREEMENT
Allmerica Financial Investment Management Services, Inc. (the "Adviser") and
Allmerica Investment Trust ("Trust") hereby confirm their Agreement covering
services as hereinafter set forth. The terms and provisions of this Agreement
shall take effect on April 16, 1998.
1. The Trust hereby retains the Adviser as investment adviser for the series
of shares of the Trust as listed on Schedule A attached hereto and for such
other series of shares as the Trust and the Adviser may from time to time
agree on, each such series of shares being hereinafter referred to as a
"Fund." The Adviser shall also manage, supervise and conduct the other
affairs and business of the Trust and matters incidental thereto, subject
always to the provisions of the Trust's Agreement and Declaration of Trust,
Bylaws and of the provisions of the Investment Company Act of 1940, as
amended ("1940 Act"). In providing and performing such services, the
Adviser will function in cooperation with and subject always to the
direction and control of the Trustees of the Trust and in cooperation with
the Trust's authorized officers and representatives.
2. Investment Advisory Services. The Adviser agrees to act as the investment
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adviser for, and to manage the investment of assets of, each Fund and to
make purchases and sales of securities for each Fund's account. The Adviser
shall assume responsibility for the management of the portfolio securities
of each Fund and the making and execution of all investment decisions for
each Fund.
A. Investment of each Fund's assets shall be in accordance with the
objectives and policies of each Fund as set forth in the current
Registration Statement of the Trust filed with the Securities and
Exchange Commission (the "SEC"), and any applicable federal and state
laws.
B. The Adviser shall report to the Trustees of the Trust (the "Trustees")
at such times and in such detail as the Trustees may from time to time
determine to be appropriate in order to permit the Trustees to
determine the adherence by the Adviser to the investment policies and
legal requirements of each Fund.
C. The Adviser shall place all orders for the purchase and sale of
portfolio investments for the account of the Funds with issuers,
brokers or dealers selected by the Adviser which may include brokers
or dealers affiliated with the Adviser. In the selection of such
brokers or dealers and the placing of such orders, the Adviser shall
always seek best execution (except to the extent permitted by the next
sentence hereof), which is to place portfolio transactions where the
Trust can obtain the most favorable combination of price and execution
services in particular transactions or provided on a continuous basis
by a broker or dealer, and to deal directly with a principal market
maker in connection with over-the-counter transactions, except when it
is believed that best execution is obtainable elsewhere. Subject to
such policies as the Trustees may determine, the Adviser shall not be
deemed to have acted unlawfully or to have breached any duty created
by this Agreement or otherwise solely by reason of its having caused
the Trust to pay a broker or dealer that provides brokerage and
research services an amount of commission for effecting a portfolio
investment transaction which is in excess of the amount of commission
another broker or dealer would have charged for effecting that
transaction, if the Adviser determines in good faith that such excess
amount of commission was reasonable in relation to the value of the
brokerage and research services provided by such broker or dealer,
viewed in terms of either that particular transaction or the overall
responsibilities of the Adviser and its affiliates with respect to the
Trust and to other clients as to which the Adviser or any affiliate of
the Adviser exercises investment discretion.
D. Subject to the provisions of the Trust's Agreement and Declaration of
Trust and the 1940 Act, the Adviser, at its expense, may select and
contract with one or more investment advisers (the "Sub-Advisers") to
provide to the Adviser such investment advice relating to the assets
of a Fund and related services as the Adviser may from time to time
deem appropriate, or delegate any or all of its functions hereunder to
one or more Sub-Advisers, provided that the Trustees shall approve any
such contract with a Sub-Adviser. So long as any Sub-Adviser serves as
investment adviser to any Fund pursuant to a Sub-Adviser Agreement in
substantially the form attached hereto as Exhibit A (the "Sub-Adviser
Agreement"), the obligation of the Adviser under this Agreement with
respect to managing the investment portfolio of such Fund shall be,
subject in any event to the control of the Trustees, to determine and
review with such Sub-Adviser the investment objectives, policies and
restrictions and placing of all orders for the purchase and sale of
portfolio securities for such Fund, all as further described in the
Sub-Adviser Agreement. The Adviser will compensate any Sub-Adviser of
any Fund for its services to such Fund. The Adviser may terminate the
services of any Sub-Adviser at any time, subject to the approval of
the Trustees, and shall at such time assume the responsibilities of
such Sub-Adviser unless and until a successor Sub-Adviser is selected.
3. Management Services. The Adviser will perform (or arrange for the
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performance by its affiliates) the management and administrative
services necessary for the operation of the Trust.
A. Subject to the supervision of the Trustees, and unless otherwise
provided herein the Adviser shall be responsible for the day to
day business activities of the Trust and shall perform all
services appropriate thereto, including: (i) providing for
members of its organization to serve without salaries as
Trustees, officers, or agents of the Trust; (ii) furnishing at
its expense such office space as may be necessary for the
suitable conduct of the Trust's business (other than pricing and
bookkeeping) and all necessary light, heat, telephone service,
office equipment stationery, and stenographic, clerical,
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mailing and messenger service in connection with such office;
(iii) on behalf of the Funds of the Trust, supervising relations
with, and monitoring the performance of, custodians,
depositories, transfer and pricing agents, accountants,
attorneys, underwriters, brokers and dealers, insurers and other
persons in any capacity deemed to be necessary or desirable; (iv)
preparing all general shareholder communications, including
shareholder reports; (v) conducting shareholder relations; (vi)
maintaining the Trust's existence and its records; (vii) during
such times as shares are publicly offered, maintaining the
registration and qualification of the Trust's shares under
federal and state law; and (viii) investigating the development
of management and shareholder services (and, if appropriate,
assisting in the development and implementation of such services)
designed to enhance the value or convenience of the Funds of the
Trust as investment vehicles.
B. The Adviser shall also furnish such reports, evaluations,
information or analyses to the Trust as the Trustees may request
from time to time or as the Adviser may deem to be desirable. The
Adviser shall make recommendations to the Trustees with respect
to Fund policies, and shall carry out such policies as are
adopted by the Trustees. The Adviser shall, subject to review by
the Trustees, furnish such other services as the Adviser shall
from time to time determine to be necessary or useful to perform
its obligations under this Agreement. Should the Trust have
occasion to call upon the Adviser for services not herein
contemplated or through the Adviser to arrange for the services
of others, the Adviser will act for the Trust upon request to the
best of its ability, the compensation for its services to be
agreed upon with respect to each such occasion as it arises.
C. The Adviser will not furnish the Trust the following services
under this Agreement:
(i) determinations of the Trust's net assets and the net asset
value per share of its shares ("pricing");
(ii) maintenance of accounts, books and records as required by
Section 31(a) of the 1940 Act and the rules thereunder
("bookkeeping"); and
(iii) provision of custodian services, transfer agent services,
dividend disbursement and reinvestment services,
shareholder services, or shareholder recordkeeping
services.
4. Expenses of the Trust. It is understood that the Trust will pay all
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its expenses other than those expressly stated to be payable by the
Adviser hereunder. The expenses
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payable by the Trust shall include, without limitation; (i) interest
and taxes; (ii) brokerage commissions and other costs in connection
with the purchase or sale of securities and other investment
instruments; (iii) fees and expenses associated with pricing and
bookkeeping;. (iv) fees and expenses of its Trustees other than those
who are "interested persons" of the Trust or the Adviser; (v) legal
and audit expenses; (vi) custodian, registrar and transfer agent fees
and expenses; (vii) fees and expenses related to the registration and
qualification of the Trust and the Fund's shares for distribution
under state and federal securities laws; (viii) expenses of printing
and mailing reports and notices and proxy material to shareholders of
the Funds; (ix) all other expenses incidental to holding meetings of
the Trust's shareholders, including proxy solicitations therefor; (x)
insurance premiums for fidelity and other coverage; (xi) its
proportionate share of association membership dues; (xii) expenses of
typesetting for printing Prospectuses and Statements of Additional
Information and supplements thereto; (xiii) expenses of printing and
mailing Prospectuses and Statements of Additional Information and
supplements thereto sent to existing shareholders: and (ix) such non-
recurring or extraordinary expenses as may arise, including those
relating to actions, suits or proceedings to which the Trust is a
party and the legal obligation which the Trust may have to indemnify
the Trust's Trustees and officers with respect thereto.
5. Compensation. As full compensation for the services furnished and
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expenses borne by the Adviser herein, the Trust will pay a monthly fee
to the Adviser, computed and paid monthly at an annual rate of the
average daily net assets of each Fund, as described in Schedule B
which is attached hereto.
The fee computed with respect to the net assets of each Fund shall
be paid from the assets of such Fund. The average daily net assets of
each Fund shall be determined by taking an average of all of the
determinations of net asset value during each month at the close of
business on each business day during such month while this Agreement
is in effect. The fee for each month shall be payable within five (5)
business days after the end of the month.
In the event that expenses of any Fund for any fiscal year should
exceed the expense limitation on investment company expenses imposed
by any statute or regulatory authority of any jurisdiction in which
shares of the Fund are then qualified for offer and sale, the
compensation due the Adviser such period shall be reduced by the
amount of such excess by a reduction or refund thereof, subject to
readjustment during the Fund's fiscal year. In the event that the
expenses with respect to any Fund should exceed any expense limitation
which the Adviser may, by written notice to the Trust, voluntarily
declare to be effective, subject to such terms and conditions as the
Adviser may prescribe in the notice, the compensation due the Adviser
shall be reduced, and, if necessary, the Adviser shall bear expenses
with respect to the Fund, to the extent required by the expense
limitation.
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If the Adviser shall serve for any period less than a full month,
the foregoing compensation shall be prorated according to the
proportion which such period bears to a full month.
In addition to the foregoing, the Trust will reimburse the Adviser
for the traveling and incidental expenses (other than the regular
Worcester office expenses described above) which may be incurred in
connection with special work performed at its request.
6. Limitation of Liability. The Adviser shall be under no liability to
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the Trust or its Shareholders or creditors for any matter or thing in
connection with the performance of any of the Adviser's services
hereunder or for any losses sustained or that may be sustained in the
purchase, sale or retention of any investment for the Funds of the
Trust made by it in good faith; provided, however, that nothing herein
contained shall be construed to protect the Adviser against any
liability to the Trust by reason of the Adviser's own willful
misfeasance, bad faith, or gross negligence in the performance of its
duties or by reason of its reckless disregard of its obligations and
duties hereunder.
7. Amendment. This Agreement may be amended at any time by mutual consent
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of the parties, provided that such amendment shall have been approved
(i) by vote of a majority of the outstanding voting securities of each
Fund affected by such amendment, and (ii) by vote of a majority of the
Trustees of the Trust who are not interested persons of the Adviser or
any Sub-Adviser or of the Trust, cast in person at a meeting called
for the purpose of voting on such approval.
8. Termination. This Agreement shall be effective as of the date
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executed, and shall remain in full force and effect as to each Fund
continuously thereafter, until terminated as provided below.
A. Unless terminated as herein provided, this Agreement shall remain
in full force and effect through May 30, 1998, and shall continue
in full force and effect for successive periods of one year
thereafter, but only so long as each such continuance is approved
(i) by the Trustees or by the affirmative vote of a majority of
the outstanding voting securities of a Fund, and (ii) by a vote
of a majority of the Trustees who are not interested persons of
the Trust or of the Adviser or of any Sub-Adviser, by vote cast
in person at a meeting called for the purpose of voting on such
approval; provided, however, that if the continuance of this
Agreement is submitted to the shareholders of a Fund for their
approval and such shareholders fail to approve such continuance
of this Agreement as provided herein, the Adviser may continue to
serve hereunder in a manner consistent with the 1940 Act and the
rules and regulations thereunder.
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B. This Agreement may be terminated as to any Fund without the
payment of any penalty by vote of the Trustees or by vote of a
majority of the outstanding voting securities of such Fund at any
annual or special meeting or by the Adviser on sixty days'
written notice.
C. This Agreement shall automatically terminate in the event of its
assignment.
9. Agreement and Declaration of Trust. A copy of the Trust's Agreement
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and Declaration is on file with the Secretary of State of the
Commonwealth of Massachusetts, and notice is hereby given that this
instrument is executed by the Trustees as Trustees and not
individually, and that the obligations of this instrument are not
binding upon any of the Trustees, officers or shareholders
individually but are binding only upon the assets and property of the
Trust.
10. Other Agreements, etc. It is understood that any of the shareholders,
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Trustees, officers and employees of the Trust may be a shareholder,
partner, director, officer or employee of, or be otherwise interested
in, the Adviser, and in any person controlled by or under common
control with the Adviser, and that the Adviser and any person
controlled by or under common control with the Adviser may have an
interest in the Trust. It is also understood that the Adviser and
persons controlled by or under common control with the Adviser have
and may have advisory, management service or other contracts with
other organizations and persons, and may have other interests and
businesses.
11. Miscellaneous. The Adviser, its directors, officers, and its employees
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retain the right to engage in other business, and to render portfolio
management, investment advisory, or other services of any kind to any
other corporation, firm, individual, or association. Neither the
Adviser nor any officer, director, or shareholder of the Adviser shall
act as principal or receive any compensation in connection with the
purchase or sale of securities by or on behalf of the Trust other than
the compensation provided in this Agreement.
The Adviser is an independent contractor and not an agent of the
Trust.
The Trust recognizes the Adviser's control of the names "SMA
Investment Trust" and "Allmerica Investment Trust" and agrees that its
right to use such names is non-exclusive and can be terminated by the
Adviser at any time. The use of such names will be terminated
automatically if at any time the Adviser or affiliate of the Adviser
ceases to be investment adviser for the Trust.
For the purposes of this Agreement, majority of the outstanding voting
securities of a Fund at any annual or special meeting shall mean a
concurring vote of (i) 67% or more of the shares of the Fund
represented at such meeting, if more than 50%
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of the outstanding shares of the Fund are represented in person or by
proxy, or (ii) 50% of the outstanding shares of the Fund, whichever is
less.
For the purposes of this Agreement, the terms "interested person" and
"assignment" shall have their respective meanings defined in the 1940
Act, subject, however, to such exemptions as may be granted by the SEC
under said Act; the term "specifically approve at least annually"
shall be construed in a manner consistent with the 1940 Act and the
rules and regulations thereunder; and the term "brokerage and research
services" shall have the meaning given in the Securities Exchange Act
of 1934 and the rules and regulations thereunder.
Each party hereto shall cooperate with each other party and all
appropriate governmental authorities (including without limitation the
Securities and Exchange Commission, the NASD and State insurance
regulators) and shall permit such authorities reasonable access to its
books and records in connection with any investigation or inquiry
relating to this Agreement or the transactions contemplated hereby.
Notwithstanding the generality of the foregoing, each party hereto
further agrees to furnish the California Insurance Commissioner, or
the Insurance Commissioner of any other state, with any information or
reports in connection with services provided under this Agreement
which such Commissioner may reasonably request in order to ascertain
whether the variable contracts operations of the Company are being
conducted in a manner consistent with the state's regulations
concerning variable contracts and any other applicable law or
regulations.
This Agreement shall be effective on the date executed. Executed this
16th day of April, 1998.
ALLMERICA FINANCIAL INVESTMENT
MANAGEMENT SERVICES, INC.
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Witness
ALLMERICA INVESTMENT TRUST
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
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Witness
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SCHEDULE A
SERIES OF SHARES OF THE TRUST
EFFECTIVE AS OF APRIL 16, 1998
Select Emerging Markets Fund
Select Aggressive Growth Fund
Select Capital Appreciation Fund
Select Value Opportunity Fund
Select International Equity Fund
Select Growth Fund
Select Strategic Growth Fund
Growth Fund
Equity Index Fund
Select Growth and Income Fund
Select Income Fund
Investment Grade Income Fund
Government Bond Fund
Money Market Fund
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SCHEDULE B
COMPENSATION
EFFECTIVE AS OF JUNE 1, 1998
As full compensation for the services furnished and expenses borne by the
Adviser herein, the Trust will pay a monthly fee to the Adviser, computed and
paid monthly at an annual rate of the average daily net assets of each Fund, as
described below:
Select Select Select Capital Select Value Select Select
Emerging Aggressive Appreciation Opportunity International Growth
Markets Fund Growth Fund Fund Fund Equity Fund Fund
------------ ----------- -------------- ------------ ------------- ------
Manager Fee 1.35% (1) (1) (2) (1) (2)
Select
Strategic Equity Select Growth Select Investment
Growth Growth Index and Income Income Grade Income
Fund Fund Fund Fund Fund Fund
--------- ------ ------ ------------- ------ ------------
Manager Fee 0.85% (1) (3) (1) (4) (4)
Government Money
Bond Market
Fund Fund
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Manager Fee 0.50% (3)
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(1) The Manager's fees for the Select Aggressive Growth Fund, Select Capital
Appreciation Fund, Select International Equity Fund, Growth Fund and Select
Growth and Income Fund, computed daily at an annual rate based on the
average daily net assets of each Fund, are based on the following schedule:
Select Select Growth
Select Aggressive Select Capital International and Income
Assets Growth Fund Appreciation Fund Equity Fund Growth Fund Fund
---------------------------------------- ----------------- ----------------- ------------- ----------- -------------
First $100 Million................... 1.00% 1.00% 1.00% 0.60% 0.75%
$100 to $250 Million................. 0.90% 0.90% 0.90% 0.60% 0.70%
$250 to $500 Million................. 0.85% 0.85% 0.85% 0.40% 0.65%
Over $500 Million.................... 0.85% 0.85% 0.85% 0.35% 0.65%
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(2) The Manager's fee for the Select Value Opportunity Fund and Select Growth
Fund, computed daily at an annual rate based on the average daily net assets
of each Fund, are based on the following schedules:
Select
Value Select
Opportunity Growth
Assets Fund Fund
------ ------ ----
First $100 Million.......... 1.00% 0.85%
Next $150 Million........... 0.85% 0.85%
Next $250 Million........... 0.80% 0.80%
Next $250 Million........... 0.75% 0.75%
Over $750 Million........... 0.70% 0.70%
(3) The Manager's fees for the Equity Index Fund and Money Market Fund, computed
daily at an annual rate based on the average daily net assets of each Fund,
are based on the following schedule:
Equity Money
Index Market
Assets Fund Fund
------ ------ ------
First $50 Million...... 0.35% 0.35%
Next $200 Million...... 0.30% 0.25%
Over $250 Million...... 0.25% 0.20%
(4) The Manager's fees for the Select Income Fund and Investment Grade Income
Fund, computed daily at an annual rate based on the average daily net assets
of each Fund, are based on the following schedule:
Select Investment
Income Grade
Assets Fund Income Fund
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First $50 Million........ 0.60% 0.50%
Next $50 Million......... 0.55% 0.45%
Over $100 Million........ 0.45% 0.40%
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