EXHIBIT 23(D)(1)(RR)
INVESTMENT ADVISORY AGREEMENT
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FORM OF
INVESTMENT ADVISORY AGREEMENT
IDEX MUTUAL FUNDS
This Agreement, entered into as of March 1, 2003 between IDEX Mutual
Funds, a Massachusetts business trust (referred to herein as the "Trust") and
AEGON/Transamerica Fund Advisers, Inc., a Florida corporation (referred to
herein as "ATF Advisers"), to provide certain management and advisory services
to certain series of shares of beneficial interest in the Trust as listed on the
attached Schedule A to this Agreement (each a "Fund," collectively the "Funds").
The Trust is registered as an open-end investment company registered
under the Investment Company Act of 1940 ("1940 Act"), and consists of more than
one series of shares, including the Funds. In managing the Funds, as well as in
the conduct of certain of its affairs, the Trust wishes to have the benefit of
the investment advisory services of ATF Advisers and its assistance in
performing certain management, administrative and promotional functions. ATF
Advisers desires to furnish services for the Trust and to perform the functions
assigned to it under this Agreement for the considerations provided.
Accordingly, the parties of agreed as follows:
1. APPOINTMENT. The Trust hereby appoints ATF Advisers as the Trust's
investment adviser and administrator for the period and on the terms set forth
in this Agreement. ATF Advisers accepts such appointment and agrees to render or
cause to be rendered the services set forth for the compensation herein
specified. In all matters relating to the performance of this Agreement, ATF
Advisers will act in conformity with the Trust's Declaration of Trust, Bylaws
and current registration statement applicable to the Funds as it may be
supplemented from time to time, and with the instructions and direction of the
Board of Trustees of the Trust, and will conform to and comply with the 1940 Act
and all other applicable federal or state laws and regulations.
2. INVESTMENT ADVISORY SERVICES. In its capacity as investment adviser
to the Trust, ATF Advisers shall have the following responsibilities:
(a) to provide a continuous investment program for each Fund including
advice as to the acquisition, holding or disposition of any or all of
the securities or other assets which the Funds may own or contemplate
acquiring from time to time, consistent with the Trust's Declaration of
Trust and each Fund's investment objective and policies adopted and
declared by the Board of Trustees and stated in the Funds' current
Prospectus;
(b) to cause the officers of ATF Advisers to attend meetings and
furnish oral or written reports, as the Trust may reasonably require,
in order to keep the Trustees and appropriate officers of the Trust
fully informed as to the conditions of the investment securities of the
Funds, the investment recommendations of ATF Advisers, and the
investment considerations which have given rise to those
recommendations; and
(c) to supervise the purchase and sale of securities as directed by the
appropriate officers of the Trust, including the selection of brokers
and dealers to execute such transactions, consistent with paragraph 8
hereof.
It is understood and agreed that ATF Advisers intends to enter into
Sub-Advisory Agreements with various sub-advisers for the Funds listed on
Schedule A pursuant to which ATF Advisers may delegate some or all of its
responsibilities under this Section 2. The compensation to be paid to each
sub-adviser for such services shall be set forth in each Sub-Advisory Agreement;
provided, however, that each such Agreement shall be approved by the Board of
Trustees, including a majority of the Trustees who are not parties to the
Sub-Advisory Agreements or interested persons (within the meaning of Section
2(a)(19) of the 0000 Xxx) of any such party (the "Disinterested Trustees"), and
by the holders of the outstanding voting securities of each of the Funds in
accordance with the requirements of Section 15 of the 1940 Act, and shall
otherwise be subject to, and contain such provisions as shall be required by,
the 1940 Act.
3. MANAGEMENT AND ADMINISTRATIVE SERVICES. ATF Advisers shall furnish
or make available to the Funds the services of executive and management
personnel to supervise the performance of all administrative, record-keeping,
shareholder relations, regulatory reporting and compliance, and all other
functions of the Funds, including supervising and coordinating the services of
the Funds' custodian and transfer agent. ATF Advisers shall also assist in the
preparation of reports to shareholders of the Funds and prepare sales literature
promoting sale of the Funds' shares as requested by the Trust.
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4. ALLOCATION OF EXPENSES. During the term of this Agreement, each Fund
will bear all expenses not expressly assumed by ATF Advisers incurred in the
operation of each Fund and the offering of its shares. Without limiting the
generality of the foregoing:
(a) Each Fund shall pay (i) fees payable to ATF Advisers pursuant to
this Agreement; (ii) the cost (including brokerage commissions, if any)
incurred in connection with purchases and sales of each Fund's
portfolio securities; (iii) expenses of organizing the Fund; (iv)
filing fees and expenses relating to registering and qualifying and
maintaining the registration and qualification of a Fund's shares for
sale under federal and state securities laws; (v) its allocable share
of the compensation, fees and reimbursements paid to the Trust's
non-interested Trustees; (vi) custodian and transfer agent fees; (vii)
legal and accounting expenses allocable to each Fund, including costs
for local representation in Massachusetts and fees of special counsel,
if any, for the independent Trustees; (viii) all federal, state and
local tax (including stamp, excise, income and franchise taxes and the
preparation and filing of all returns and reports in connection
therewith; (ix) cost of certificates and delivery to purchasers; (x)
expenses of preparing and filing reports with federal and state
regulatory authorities; (xi) expenses of shareholders' meetings and of
preparing, printing and distributing proxy statements (unless otherwise
agreed to by the Trust and ATF Advisers); (xii) costs of any liability,
uncollectible items of deposit and other insurance or fidelity bonds;
(xiii) any costs, expenses or losses arising out of any liability of or
claim for damage or other relief asserted against the Trust for
violation of any law; (xiv) expenses of preparing, typesetting and
printing prospectuses and supplements thereto for existing shareholders
and of reports and statements to shareholders; (xv) fees and expenses
in connection with membership in investment company organizations and
12b-1 fees; and (xvi) any extraordinary expenses incurred by the Trust
on behalf of the Funds;
(b) ATF Advisers shall pay (i) all expenses incurred by it in the
performance of its duties under this Agreement; and (ii) compensation,
fees and expenses of officers and Trustees of the Trust, except for
such Trustees who are not interested persons (as defined in the 0000
Xxx) of ATF Advisers;
(c) If, for any fiscal year, the total expenses of a Fund, including
but not limited to: the fees to ATF Advisers, compensation to its
custodian, transfer agent, registrar, auditors and legal counsel,
printing expense, and fees, compensation and expenses to Trustees who
are not interested persons, exceed any expense limitation imposed by
applicable state law, ATF Advisers shall reimburse a Fund for such
excess in the manner and to the extent required by applicable state
law; provided, however, that ATF Advisers shall reimburse each Fund for
the amount of such expenses which exceed the expense cap of the Fund's
average daily net assets as listed in Schedule A attached to this
Agreement. For purposes of this sub-paragraph, "total expenses" shall
not include interest, taxes, litigation expenses, brokerage commissions
or other costs incurred in acquiring or disposing of any of a Fund's
portfolio securities, expenses incurred pursuant to a Fund's Plan of
Distribution under Rule 12b-1 of the 1940 Act, or any costs arising
other than in the ordinary and necessary course of a Fund's business.
5. OBLIGATIONS OF TRUST. The Trust shall have the following obligations
under the Agreement:
(a) to keep ATF Advisers continuously and fully informed as to the
composition of its investment portfolio of each Fund and the nature of
all of its assets and liabilities from time to time;
(b) to furnish ATF Advisers with a certified copy of any financial
statement or report prepared for a Fund by certified or independent
public accountants, and with copies of any financial statements or
reports made to its shareholders or to any governmental body or
securities exchange;
(c) to furnish ATF Advisers with any further materials or information
which ATF Advisers may reasonably request to enable it to perform its
functions under this Agreement; and
(d) to compensate ATF Advisers for its services in accordance with the
provisions of Section 6 hereof.
6. COMPENSATION. Each Fund shall pay to ATF Advisers for its services a
fee, computed daily and paid monthly, payable on the last day of each month
during which or part of which this Agreement is in effect, as set forth in
Schedule A attached to this Agreement, as it may be amended from time to time in
accordance with Section 15 below. For the month during which this Agreement
becomes effective and the month during which it terminates, however, there shall
be an
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appropriate pro-ration of the fee payable for such month based on the number of
calendar days of such month during which this Agreement is effective.
7. TREATMENT OF INVESTMENT ADVICE. With respect to a Fund, the Fund
shall retain full control over its own investment policies. However, the
Trustees of the Trust may delegate to the appropriate officers of the Trust, or
to a committee of Trustees, the power to authorize purchases, sales or other
actions affecting each Fund in the interim between meetings of the Trustees,
provided such action is consistent with the established investment policy of the
Trustees and is reported to the Trustees at their next meeting.
8. BROKERAGE COMMISSIONS. For purposes of this Agreement, brokerage
commissions paid by a Fund upon the purchase or sale of its portfolio securities
shall be considered a cost of securities of the Fund and shall be paid by the
Fund. ATF Advisers is authorized and directed to place a Fund's securities
transactions, or to delegate to each sub-adviser the authority and direction to
place a Fund's securities transactions, only with brokers and dealers who render
satisfactory service in the execution of orders at the most favorable prices and
at reasonable commission rates; provided, however, that ATF Advisers or each
sub-adviser, may pay a broker or dealer an amount of commission for effecting a
securities transaction in excess of the amount of commission another broker or
dealer would have charged for effecting that transaction if ATF Advisers or each
sub-adviser determines in good faith that such 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 ATF Advisers or each sub-adviser.
ATF Advisers and each sub-adviser are also authorized to consider sales of Fund
shares (which shall be deemed to include also shares of other registered
investment companies with the same investment adviser) by a broker-dealer or the
recommendation of a broker-dealer to its customers that they purchase Fund
shares as a factor in selecting broker-dealers to execute the Fund's securities
transactions, provided that in placing fund business with such broker-dealers,
ATF Advisers and each sub-adviser shall seek the best execution of each
transaction and all such brokerage placement shall be consistent with the
Conduct Rules of the National Association of Securities Dealers, Inc.
Notwithstanding the foregoing, the Trust shall retain the right to direct the
placement of all securities transactions of each Fund, and the Trustees may
establish policies or guidelines to be followed by ATF Advisers and each
sub-adviser in placing portfolio transactions for each Fund pursuant to the
foregoing provisions. ATF Advisers shall report on the placement of portfolio
transactions each quarter to the Trustees of the Trust.
9. PURCHASES BY AFFILIATES. Neither ATF Advisers nor any officer or
Director thereof shall take a long or short position in the securities issued by
the Funds. This prohibition, however, shall not prevent the purchase from a Fund
of shares issued by the Fund on behalf of the Trust, by the officers or
Directors of ATF Advisers (or by deferred benefit plans established for their
benefit) at the current price available to the public, or at such price with
reductions in sales charge as may be permitted by the Fund's current prospectus,
in accordance with Section 22(d) of the 1940 Act.
10. TERM. This Agreement shall continue in effect, unless sooner
terminated in accordance with its terms, for an initial term ending April 30,
2003, and shall continue in effect from year to year thereafter, provided such
continuance is specifically approved at least annually by the vote of a majority
of the Trustees of the Trust who are not parties hereto or interested persons
(as that term is defined in Section 2(a)(19) of the 1940 Act, as amended) of any
such party, cast in person at a meeting called for the purpose of voting on the
approval of the terms of such renewal, and by either the Trustees of the Trust
or the affirmative vote of a majority of the outstanding voting securities of
each Fund (as that phrase is defined in Section 2(a)(42) of the 1940 Act.
11. TERMINATION. This Agreement may be terminated at any time, without
penalty, by the Trustees of the Trust, or with respect to a Fund, by the
shareholders of such Fund acting by vote of at least a majority of its
outstanding voting securities (as that phrase is defined in Section 2(a)(42) of
the 1940 Act), provided in either case that 60 days' written notice of
termination be given to ATF Advisers at its principal place of business. This
Agreement may be terminated by ATF Advisers at any time by giving 60 days'
written notice of termination to the Trust, addressed to its principal place of
business.
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12. USE OF NAME. If this Agreement is terminated and ATF Advisers no
longer serves as investment adviser to the Funds, ATF Advisers reserves the
right to withdraw from the Trust the use of the name "IDEX" with respect to the
Funds or any name misleadingly implying a continuing relationship between the
Funds and ATF Advisers or any of its affiliates.
13. LIABILITY OF ATF ADVISERS. ATF Advisers may rely on information
reasonably believed by it to be accurate and reliable. Except as may otherwise
be provided by the 1940 Act, neither ATF Advisers nor its officers, directors,
employees or agents shall be subject to any liability to the Trust or the Funds
or any shareholder of the Funds for any error of judgment, mistake of law or any
loss arising out of any investment or other act or omission in the course of,
connected with or arising out of any service to be rendered hereunder, except by
reason of willful misfeasance, bad faith or gross negligence in its performance
of its duties or by reason of reckless disregard of its obligations and duties
under this Agreement.
14. ASSIGNMENT. This Agreement shall terminate automatically in the
event of its assignment (as the term is defined in Section 2(a)(4) of the 1940
Act).
15. AMENDMENTS. This Agreement may be amended only with the approval by
the affirmative vote of a majority of the outstanding voting securities of each
affected Fund (as that phrase is defined in Section 2(a)(42) of the 0000 Xxx)
and the approval by the vote of a majority of Trustees of the Trust who are not
parties hereto or interested persons (as that phrase is defined in Section
2(a)(19) of the 0000 Xxx) of any such party, cast in person at a meeting called
for the purpose of voting on the approval of such amendment, unless otherwise
permitted by the 1940 Act.
16. PRIOR AGREEMENTS. This Agreement supersedes all prior agreements
between the parties relating to the subject matter hereof, and all such prior
agreements are deemed terminated upon the effectiveness of this Agreement.
17. LIMITATION OF LIABILITY. A copy of the Trust's Declaration of Trust
is on file with the Secretary of The Commonwealth of Massachusetts, and notice
is hereby given that this Agreement is executed on behalf of the Trustees as
Trustees of the Trust and not individually, and that the obligations under this
Agreement are not binding upon any of the Trustees, officers, shareholders,
agents or employees of the Trust individually, but binding only upon the assets
and property of the Trust.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their duly authorized signatories as of the date and year first above
written.
ATTEST: AEGON/TRANSAMERICA FUND ADVISERS, INC.
By: By:
---------------------------------- -----------------------------------
Name: Xxxxx X. Xxxxxx Name: Xxxx X. Xxxxxx
Title: Assistant Vice President Title: Vice President, General
and Assistant Secretary Counsel, Compliance Officer
and Secretary
ATTEST: IDEX MUTUAL FUNDS
By: By:
---------------------------------- -----------------------------------
Name: Xxxxx X. Xxxxxx Name: Xxxx X. Xxxxxx
Title: Assistant Vice President Title: Vice President, General
and Assistant Secretary Counsel and Secretary
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INVESTMENT ADVISORY AGREEMENT
SCHEDULE A
FUND INVESTMENT ADVISER COMPENSATION EXPENSE CAP TERMINATION DATE
----------------------------------- ------------------------------------------------------- ----------- -----------------
IDEX PIMCO REAL RETURN 0.70% of the Fund's average daily net assets. 1.30% February 28, 2005
IDEX CLARION REAL ESTATE SECURITIES 0.80% of the first $250 million of the Fund's 1.40% February 28, 2005
average daily net assets; 0.775% up to $500 million;
0.70% up to $1 billion; and 0.65% of the Fund's average
daily net assets in excess of $1 billion.
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