PIC INVESTMENT TRUST
MANAGEMENT AGREEMENT
AGREEMENT made this day of , 1997, by and
between PIC INVESTMENT TRUST (the "Trust"), a business trust
organized under the laws of the State of Delaware, on behalf of
the PIC TOTAL RETURN FUND (the "Fund"), a series of the Trust,
and PROVIDENT INVESTMENT COUNSEL, INC. (the "Advisor"), a
California corporation.
WITNESSETH:
In consideration of the mutual promises and agreements
herein contained and other good and valuable consideration, the
receipt of which is hereby acknowledged, it is hereby agreed by
and between the parties hereto as follows:
l. In General
The Trust hereby appoints the Advisor to act as investment
adviser to the Fund. The Advisor agrees, all as more fully set
forth herein, to provide professional investment management with
respect to the investment of the assets of the Fund and to
supervise and arrange the purchase and sale of securities held in
the portfolio of the Fund.
2. Duties and Obligations of the Advisor
with respect to Management of the Fund
(a) Subject to the succeeding provisions of this
section and subject to the direction and control of the
Board of Trustees of the Trust, the Advisor shall:
(i) Decide what securities shall be purchased or
sold by the Fund and when; and
(ii) Arrange for the purchase and the sale of
securities held in the portfolio of the Fund by placing
purchase and sale orders for the Fund.
(b) Any investment purchases or sales made by the
Advisor shall at all times conform to, and be in accordance
with, any requirements imposed by: (l) the provisions of
the Investment Company Act of 1940 (the "Act") and of any
rules or regulations in force thereunder; (2) any other
applicable provisions of law; (3) the provisions of the
Declaration of Trust and By-Laws of the Trust as amended
from time to time; (4) any policies and determinations of
the Board of Trustees of the Trust; and (5) the fundamental
policies of the Fund, as reflected in its registration
statement under the Act, or as amended by the shareholders
of the Fund.
(c) The Advisor shall give the Fund the benefit of its
best judgment and effort in rendering services hereunder.
In the absence of willful misfeasance, bad faith, gross
negligence or reckless disregard of obligations or duties
("disabling conduct") hereunder on the part of the Advisor
(and its officers, directors, agents, employees, controlling
persons, shareholders and any other person or entity
affiliated with the Advisor) the Advisor shall not be
subject to liability to the Fund or to any shareholder of
the Fund for any act or omission in the course of, or
connected with rendering services hereunder, including
without limitation, any error of judgment or mistake of law
or for any loss suffered by any of them in connection with
the matters to which this Agreement related, except to the
extent specified in Section 36(b) of the Act concerning loss
resulting from a breach of fiduciary duty with respect to
the receipt of compensation for services. Except for such
disabling conduct, the Fund shall indemnify the Advisor (and
its officers, directors, agents, employees, controlling
persons, shareholders and any other person or entity
affiliated with the Advisor) from any liability arising from
the Advisor's conduct under this Agreement to the extent
permitted by the Declaration of Trust and applicable law.
(d) Nothing in this Agreement shall prevent the
Advisor or any affiliated person (as defined in the Act) of
the Advisor from acting as investment adviser or manager
and/or principal underwriter for any other person, firm or
corporation and shall not in any way limit or restrict the
Advisor or any such affiliated person from buying, selling
or trading any securities for its or their own accounts or
the accounts of others for whom it or they may be acting,
provided, however, that the Advisor expressly represents
that it will undertake no activities which, in its judgment,
will adversely affect the performance of its obligations to
the Fund under this Agreement.
(e) It is agreed that the Advisor shall have no
responsibility or liability for the accuracy or completeness
of the Trust's Registration Statement under the Act except
for information supplied by the Advisor for inclusion
therein.
3. Broker-Dealer Relationships
In connection with its duties set forth in Section 2(a)(ii)
of this Agreement to arrange for the purchase and the sale of
securities held by the Fund by placing purchase and sale orders
for the Fund, the Advisor shall select such broker-dealers
("brokers") as shall, in the Advisor's judgment, implement the
policy of the Trust to achieve "best execution", i.e., prompt and
efficient execution at the most favorable securities price. In
making such selection, the Advisor is authorized to consider the
reliability, integrity and financial condition of the broker.
The Advisor is also authorized to consider whether the broker
provides brokerage and/or research and other services to the Fund
and/or other accounts of the Advisor. The commissions paid to
such brokers may be higher than another broker would have charged
if a good faith determination is made by the Advisor that the
commission is reasonable in relation to the services provided,
viewed in terms of either that particular transaction or the
Advisor's overall responsibilities as to the accounts as to which
it exercises investment discretion. The Advisor shall use its
judgment in determining that the amount of commissions paid are
reasonable in relation to the value of brokerage and research
services provided and need not place or attempt to place a
specific dollar value on such services or on the portion of
commission rates reflecting such services. To demonstrate that
such determinations were in good faith, and to show the overall
reasonableness of commissions paid, the Advisor shall be prepared
to show that commissions paid (i) were for purposes contemplated
by this Agreement; (ii) provide lawful and appropriate assistance
to the Advisor in the performance of its decision-making
responsibilities; and (iii) were within a reasonable range as
compared to the rates charged by qualified brokers to other
institutional investors as such rates may become known from
available information. The Trust recognizes that, on any
particular transaction, a higher than usual commission may be
paid due to the difficulty of the transaction in question. The
Advisor also is authorized to consider sales of shares, and any
other factors that the Trustees shall direct, in the selection of
brokers to execute brokerage and principal transactions, subject
to the requirements of "best execution", as defined above.
4. Allocation of Expenses
The Advisor agrees that it will furnish the Fund, at the
Advisor's expense, with all office space and facilities, and
equipment and clerical personnel necessary for carrying out its
duties under this Agreement. The Advisor will also pay all
compensation of all Trustees, officers and employees of the Trust
who are affiliated persons of the Advisor. All costs and
expenses not expressly assumed by the Advisor under this
Agreement shall be paid by the Fund, including, but not limited
to (i) interest and taxes; (ii) brokerage commissions; (iii)
insurance premiums; (iv) compensation and expenses of its
Trustees other than those affiliated with the Advisor or its
Administrator; (v) legal and audit expenses; (vi) fees and
expenses of the Fund's custodian, transfer agent and accounting
services agent; (vii) expenses incident to the issuance of its
shares, including stock certificates and issuance of shares on
the payment of, or reinvestment of, dividends; (viii) fees and
expenses incident to the registration under Federal or state
securities laws of the Fund or its shares; (ix) expenses of
preparing, printing and mailing reports, notices, proxy material
and prospectuses to shareholders of the Fund; (x) all other
expenses incidental to holding meetings of the Fund's
shareholders; (xi) dues or assessments of or contributions to the
Investment Company Institute or any successor or other industry
association; (xii) such non-recurring expenses as may arise,
including litigation affecting the Trust and the legal
obligations which the Trust may have to indemnify its officers
and Trustees with respect thereto; (xiii) fees of the Fund's
Administrator and (xiii) the organization costs of the Fund.
5. Compensation of the Advisor
The Fund agrees to pay the Advisor and the Advisor agrees to
accept as full compensation for all services rendered by the
Advisor as such, an annual management fee, payable monthly and
computed on the value of the net assets of the Fund as of the
close of business each business day at the annual rate of 0.80 of
1% of such net assets of the Fund.
6. Duration and Termination
(a) This Agreement shall go into effect on the date set
forth above and shall, unless terminated as hereinafter provided,
continue in effect until September 30, 1999, and thereafter from
year to year, but only so long as such continuance is
specifically approved at least annually by the Trust's Board of
Trustees, including the vote of a majority of the Trustees who
are not parties to this Agreement or "interested persons" (as
defined in the Act) of any such party cast in person at a meeting
called for the purpose of voting on such approval, or by the vote
of the holders of a "majority" (as so defined) of the outstanding
voting securities of the Fund.
(b) This Agreement may be terminated by the Advisor at any
time without penalty upon giving the Trust sixty (60) days'
written notice (which notice may be waived by the Trust) and may
be terminated by the Trust at any time without penalty upon
giving the Advisor sixty (60) days' written notice (which notice
may be waived by the Advisor), provided that such termination by
the Trust shall be directed or approved by the vote of a majority
of all of its Trustees in office at the time or by the vote of
the holders of a majority (as defined in the Act) of the voting
securities of the Fund. This Agreement shall automatically
terminate in the event of its assignment (as so defined).
IN WITNESS WHEREOF, the parties hereto have caused the
foregoing instrument to be executed by duly authorized persons
and their seals to be hereunto affixed, all as of the day and
year first above written.
PIC INVESTMENT TRUST
By
ATTEST:
PROVIDENT INVESTMENT COUNSEL, INC.
By
ATTEST:
