XXXX XXXXXXX FOCUSED RELATIVE VALUE FUND
(a series of Xxxx Xxxxxxx Series Trust)
000 Xxxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
November 1, 2000
Xxxx Xxxxxxx Advisers, Inc.
000 Xxxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Investment Management Contract
----------------------------------------
Ladies and Gentlemen:
Xxxx Xxxxxxx Series Trust (the "Trust"), of which Xxxx Xxxxxxx Focused Relative
Value Fund (the "Fund") is a series, has been organized as a business trust
under the laws of The Commonwealth of Massachusetts to engage in the
business of an investment company. The Trust's shares of beneficial
interest, no par value, may be divided into series, each series
representing the entire undivided interest in a separate portfolio of
assets. This Agreement relates solely to the Fund.
The Board of Trustees of the Trust (the "Trustees") has selected Xxxx Xxxxxxx
Advisers, Inc. (the "Adviser") to provide overall investment advice and
management for the Fund, and to provide certain other services, as more
fully set forth below, and the Adviser is willing to provide such advice,
management and services under the terms and conditions hereinafter set
forth.
Accordingly, the Adviser and the Trust, on behalf of the Fund, agree as follows:
1. DELIVERY OF DOCUMENTS. The Trust has furnished the Adviser with copies,
properly certified or otherwise authenticated, of each of the following:
(a) Declaration of Trust dated September 10, 1996, as amended from time to time
(the "Declaration of Trust");
(b) By-Laws of the Trust as in effect on the date hereof;
(c) Resolutions of the Trustees selecting the Adviser as investment adviser for
the Fund and approving the form of this Agreement;
(d) The Trust's Code of Ethics.
The Trust will furnish to the Adviser from time to time copies, properly
certified or otherwise authenticated, of all amendments of or supplements
to the foregoing, if any.
2. INVESTMENT AND MANAGEMENT SERVICES. The Adviser will use its best efforts
to provide to the Fund continuing and suitable investment programs with
respect to investments, consistent with the investment objectives, policies
and restrictions of the Fund. In the performance of the Adviser's duties
hereunder, subject always (x) to the provisions contained in the documents
delivered to the Adviser pursuant to Section 1, as each of the same may
from time to time be amended or supplemented, and (y) to the limitations
set forth in the Fund's then- current Prospectus and Statement of
Additional Information included in the registration statement of the Trust
as in effect from time to time under the Securities Act of 1933, as
amended, and the Investment Company Act of 1940, as amended (the "1940
Act"), the Adviser will, at its own expense:
(a) furnish the Fund with advice and recommendations, consistent with the
investment objectives, policies and restrictions of the Fund, with respect
to the purchase, holding and disposition of portfolio securities, alone or
in consultation with any subadviser or subadvisers appointed pursuant to
this Agreement and subject to the provisions of any sub-investment
management contract respecting the responsibilities of such subadviser or
subadvisers;
(b) advise the Fund in connection with policy decisions to be made by the
Trustees or any committee thereof with respect to the Fund's investments
and, as requested, furnish the Fund with research, economic and statistical
data in connection with the Fund's investments and investment policies;
(c) provide administration of the day-to-day investment operations of the Fund;
(d) submit such reports relating to the valuation of the Fund's securities as
the Trustees may reasonably request;
(e) assist the Fund in any negotiations relating to the Fund's investments with
issuers, investment banking firms, securities brokers or dealers and other
institutions or investors;
(f) consistent with the provisions of Section 7 of this Agreement, place orders
for the purchase, sale or exchange of portfolio securities with brokers or
dealers selected by the Adviser, PROVIDED that in connection with the
placing of such orders and the selection of such brokers or dealers the
Adviser shall seek to obtain execution and pricing within the policy
guidelines determined by the Trustees and set forth in the Prospectus and
Statement of Additional Information of the Fund as in effect from time to
time;
(g) provide office space and office equipment and supplies, the use of
accounting equipment when required, and necessary executive, clerical and
secretarial personnel for the administration of the affairs of the Fund;
(h) from time to time or at any time requested by the Trustees, make reports to
the Fund of the Adviser's performance of the foregoing services and furnish
advice and recommendations with respect to other aspects of the business
and affairs of the Fund;
(i) maintain all books and records with respect to the Fund's securities
transactions required by the 1940 Act, including subparagraphs (b)(5), (6),
(9) and (10) and paragraph (f) of Rule 31a-1 thereunder (other than those
records being maintained by the Fund's custodian or transfer agent) and
preserve such records for the periods prescribed therefor by Rule 31a-2 of
the 1940 Act (the Adviser agrees that such records are the property of the
Fund and will be surrendered to the Fund promptly upon request therefor);
(j) obtain and evaluate such information relating to economies, industries,
businesses, securities markets and securities as the Adviser may deem
necessary or useful in the discharge of the Adviser's duties hereunder;
(k) oversee, and use the Adviser's best efforts to assure the performance of
the activities and services of the custodian, transfer agent or other
similar agents retained by the Fund;
(l) give instructions to the Fund's custodian as to deliveries of securities to
and from such custodian and transfer of payment of cash for the account of
the Fund; and
(m) appoint and employ one or more sub-advisors satisfactory to the Fund under
sub- investment management agreements.
3. EXPENSES PAID BY THE ADVISER. The Adviser will pay:
(a) the compensation and expenses of all officers and employees of the Trust;
(b) the expenses of office rent, telephone and other utilities, office
furniture, equipment, supplies and other expenses of the Fund; and
(c) any other expenses incurred by the Adviser in connection with the
performance of its duties hereunder.
4. EXPENSES OF THE FUND NOT PAID BY THE ADVISER. The Adviser will not be
required to pay any expenses which this Agreement does not expressly make
payable by it. In particular, and without limiting the generality of the
foregoing but subject to the provisions of Section 3, the Adviser will not
be required to pay under this Agreement:
(a) any and all expenses, taxes and governmental fees incurred by the Trust or
the Fund prior to the effective date of this Agreement;
(b) without limiting the generality of the foregoing clause (a), the expenses
of organizing the Trust and the Fund (including without limitation, legal,
accounting and auditing fees and expenses incurred in connection with the
matters referred to in this clause (b), of initially registering shares of
the Trust under the Securities Act of 1933, as amended, and of qualifying
the shares for sale under state securities laws for the initial offering
and sale of shares;
(c) the compensation and expenses of Trustees who are not interested persons
(as used in this Agreement, such term shall have the meaning specified in
the 0000 Xxx) of the Adviser and of independent advisers, independent
contractors, consultants, managers and other unaffiliated agents employed
by the Fund other than through the Adviser;
(d) legal, accounting, financial management, tax and auditing fees and expenses
of the Fund (including an allocable portion of the cost of its employees
rendering such services to the Fund);
(e) the fees and disbursements of custodians and depositories of the Fund's
assets, transfer agents, disbursing agents, plan agents and registrars;
(f) taxes and governmental fees assessed against the Fund's assets and payable
by the Fund;
(g) the cost of preparing and mailing dividends, distributions, reports,
notices and proxy materials to shareholders of the Fund;
(h) brokers' commissions and underwriting fees;
(i) the expense of periodic calculations of the net asset value of the shares
of the Fund; and
(j) insurance premiums on fidelity, errors and omissions and other coverages.
5. COMPENSATION OF THE ADVISER. For all services to be rendered, facilities
furnished and expenses paid or assumed by the Adviser as herein provided,
the Adviser shall be entitled to a fee, paid monthly in arrears, at an
annual rate equal to 0.85% of the average daily net asset value of the
Fund.
The "average daily net assets" of the Fund shall be determined on the basis set
forth in the Fund's Prospectus or otherwise consistent with the 1940 Act
and the regulations promulgated thereunder. The Adviser will receive a pro
rata portion of such monthly fee for any periods in which the Adviser
serves as investment adviser to the Fund for less than a full month. On any
day that the net asset value calculation is suspended as specified in the
Fund's Prospectus, the net asset value for purposes of calculating the
advisory fee shall be calculated as of the date last determined.
In addition, the Adviser may agree not to impose all or a portion of its fee
(in advance of the time its fee would otherwise accrue) and/or undertake to
make any other payments or arrangements necessary to limit the Fund's
expenses to any level the Adviser may specify. Any fee reduction or
undertaking shall constitute a binding modification of this Agreement while
it is in effect but may be discontinued or modified prospectively by the
Adviser at any time.
6. OTHER ACTIVITIES OF THE ADVISER AND ITS AFFILIATES. Nothing herein
contained shall prevent the Adviser or any affiliate or associate of the
Adviser from engaging in any other business or from acting as investment
adviser or investment manager for any other person or entity, whether or
not having investment policies or portfolios similar to the Fund's; and it
is specifically understood that officers, directors and employees of the
Adviser and those of its parent company, Xxxx Xxxxxxx Life Insurance
Company, or other affiliates may continue to engage in providing portfolio
management services and advice to other investment companies, whether or
not registered, to other investment advisory clients of the Adviser or of
its affiliates and to said affiliates themselves.
The Adviser shall have no obligation to acquire with respect to the Fund a
position in any investment which the Adviser, its officers, affiliates or
employees may acquire for its or their own accounts or for the account of
another client, if, in the sole discretion of the Adviser, it is not
feasible or desirable to acquire a position in such investment on behalf of
the Fund. Nothing herein contained shall prevent the Adviser from
purchasing or recommending the purchase of a particular security for one or
more funds or clients while other funds or clients may be selling the same
security.
7. AVOIDANCE OF INCONSISTENT POSITION. In connection with purchases or sales
of portfolio securities for the account of the Fund, neither the Adviser
nor any of its investment management subsidiaries, nor any of the Adviser's
or such investment management subsidiaries' directors, officers or
employees will act as principal or agent or receive any commission, except
as may be permitted by the 1940 Act and rules and regulations promulgated
thereunder. If any occasions shall arise in which the Adviser advises
persons concerning the shares of the Fund, the Adviser will act solely on
its own behalf and not in any way on behalf of the Fund. Nothing herein
contained shall limit or restrict the Adviser or any of its officers,
affiliates or employees from buying, selling or trading in any securities
for its or their own account or accounts.
8. NO PARTNERSHIP OR JOINT VENTURE. Neither the Trust, the Fund nor the
Adviser are partners of or joint venturers with each other and nothing
herein shall be construed so as to make them such partners or joint
venturers or impose any liability as such on any of them.
9. NAME OF THE TRUST AND THE FUND. The Trust and the Fund may use the name
"Xxxx Xxxxxxx" or any name or names derived from or similar to the names
"Xxxx Xxxxxxx Advisers, Inc.", "Xxxx Xxxxxxx Life Insurance Company", or
"Xxxx Xxxxxxx Financial Services, Inc." only for so long as this Agreement
remains in effect. At such time as this Agreement shall no longer be in
effect, the Trust and the Fund will (to the extent that they lawfully can)
cease to use such a name or any other name indicating that the Fund is
advised by or otherwise connected with the Adviser. The Fund acknowledges
that it has adopted the name Xxxx Xxxxxxx Focused Relative Value Fund
through permission of Xxxx Xxxxxxx Life Insurance Company, a Massachusetts
insurance company, and agrees that Xxxx Xxxxxxx Life Insurance Company
reserves to itself and any successor to its business the right to grant the
nonexclusive right to use the name "Xxxx Xxxxxxx" or any similar name or
names to any other corporation or entity, including but not limited to any
investment company of which Xxxx Xxxxxxx Life Insurance Company or any
subsidiary or affiliate thereof shall be the investment adviser.
10. LIMITATION OF LIABILITY OF THE ADVISER. The Adviser shall not be liable for
any error of judgment or mistake of law or for any loss suffered by the
Trust in connection with the matters to which this Agreement relates,
except a loss resulting from willful misfeasance, bad faith or gross
negligence on the part of the Adviser in the performance of its duties or
from reckless disregard by it of its obligations and duties under this
Agreement. Any person, even though also employed by the Adviser, who may be
or become an employee of and paid by the Trust shall be deemed, when acting
within the scope of his employment by the Fund, to be acting in such
employment solely for the Trust and not as the Adviser's employee or agent.
11. DURATION AND TERMINATION OF THIS AGREEMENT. This Agreement shall remain in
force until June 30, 2002, and from year to year thereafter, but only so
long as such continuance is specifically approved at least annually by (a)
a majority of the Trustees who are not interested persons of the Adviser or
(other than as Board members) of the Fund, cast in person at a meeting
called for the purpose of voting on such approval, and (b) either (i) the
Trustees or (ii) a majority of the outstanding voting securities of the
Fund. This Agreement may, on 60 days' written notice, be terminated at any
time without the payment of any penalty by the vote of a majority of the
outstanding voting securities of the Fund, by the Trustees or by the
Adviser. Termination of this Agreement shall not be deemed to terminate or
otherwise invalidate any provisions of any contract between the Adviser and
any other series of the Trust. This Agreement shall automatically terminate
in the event of its assignment. In interpreting the provisions of this
Section 11, the definitions contained in Section 2(a) of the 1940 Act
(particularly the definitions of "assignment," "interested person" and
"voting security") shall be applied.
12. AMENDMENT OF THIS AGREEMENT. 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 amendment, transfer,
assignment, sale, hypothecation or pledge of this Agreement shall be
effective until approved by (a) the Trustees, including a majority of the
Trustees who are not interested persons of the Adviser or (other than as
Trustees) of the Fund, cast in person at a meeting called for the purpose
of voting on such approval, and (b) a majority of the outstanding voting
securities of the Fund, as defined in the 1940 Act.
13. GOVERNING LAW. This Agreement shall be governed and construed in
accordance with the laws of The Commonwealth of Massachusetts.
14. SEVERABILITY. The provisions of this Agreement are independent of and
separable from each other, and no provision shall be affected or rendered
invalid or unenforceable by virtue of the fact that for any reason any
other or others of them may be deemed invalid or unenforceable in whole or
in part.
15. MISCELLANEOUS. The captions in this Agreement are included for convenience
of reference only and in no way define or limit any of the provisions
hereof or otherwise affect their construction or effect. This Agreement may
be executed simultaneously in two or more counterparts, each of which shall
be deemed an original, but all of which together shall constitute one and
the same instrument. The name Xxxx Xxxxxxx Focused Relative Value Fund is a
series designation of the Trustees under the Trust's Declaration of Trust.
The Declaration of Trust has been filed with the Secretary of State of The
Commonwealth of Massachusetts. The obligations of the Fund are not
personally binding upon, nor shall resort be had to the private property
of, any of the Trustees, shareholders, officers, employees or agents of the
Trust, but only upon the Fund and its property. The Fund shall not be
liable for the obligations of any other series of the Trust and no other
series shall be liable for the Fund's obligations hereunder.
Yours very truly,
XXXX XXXXXXX SERIES TRUST
on behalf of Xxxx Xxxxxxx Focused Relative Value Fund
By: ___________________________
Xxxxxxx X. Xxxx
President
The foregoing contract
is hereby agreed to as
of the date hereof.
XXXX XXXXXXX ADVISERS, INC.
By: ___________________________
Xxxxx X. Xxxxxx
Vice President and Secretary
s:\funds\series\focusedrelativevalue\Inv Mgt Contract
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