INVESTMENT ADVISORY AGREEMENT
BETWEEN
SSGA FUNDS MANAGEMENT, INC.
AND
NAVIGATOR SECURITIES LENDING TRUST
This Agreement is made as of this 1st day of
May, 2001, between Navigator Securities Lending Trust,
a Massachusetts business trust (the Investment
Company), and SSgA Funds Management, Inc., a
Massachusetts corporation (the Adviser).
WHEREAS, the Investment Company is an open-end,
diversified management investment company registered
under the Investment Company Act of 1940, as amended
(the 1940 Act), currently consisting of three
portfolio series, the Navigator Government Portfolio,
the Navigator Prime Portfolio and the Navigator
Short-Term Bond Portfolio (the Initial Funds), having
their own investment policies; and
WHEREAS, the Adviser is in the business of
providing investment advisory services; and
WHEREAS, the Investment Company desires to
retain the Adviser to render investment advisory
services to the Investment Company with respect to the
Initial Funds and possibly such other funds (the
Additional Funds) as the Investment Company and the
Adviser may agree upon (each Initial Fund and Additional
Fund being referred to herein as a Fund and
collectively as the Funds), and the Adviser is willing
to render such services;
NOW, THEREFORE, in consideration of the mutual
agreements contained herein, the Investment Company and
Adviser agree as follows:
1. APPOINTMENT OF ADVISER.
(a) INITIAL FUNDS: The Investment
Company hereby appoints the Adviser to act as investment
adviser to the Initial Funds for the period and on the
terms set forth in this Agreement. The Adviser accepts
such appointment and agrees to render the services
herein set forth, for the compensation herein provided.
The Investment Company warrants that the Adviser has
been duly appointed to act hereunder.
(b) ADDITIONAL FUNDS: In the event that
the Investment Company establishes one or more
Additional Funds with respect to which it desires to
retain the Adviser to render investment advisory
services hereunder, it shall so notify the Adviser in
writing, indicating the advisory fee to be payable with
respect to the Additional Fund. If the Adviser is
willing to render such services, it shall so notify the
Investment Company in writing, whereupon such Additional
Fund shall become a Fund hereunder. In such event, a
writing signed by both the Investment Company and the
Adviser shall be annexed hereto as a part hereof
indicating that such Additional Fund has become a Fund
hereunder and reflecting the agreed-upon fee schedule
for such Fund.
2. ADVISORY DUTIES. Subject to the supervision of
the Board of Trustees of the Investment Company, the Adviser
shall manage the investment operations and the composition of the
Funds, including the purchase, retention and disposition thereof,
in accordance with each Funds investment objective and policies
as stated in the Investment Companys Registration Statement. The
Adviser is authorized to engage one or more sub-advisers in
connection with the Advisers duties under this Agreement, which
sub-advisers may be affiliates of the Manager. The Advisers
duties hereunder are subject to the following understandings:
(a) The Adviser shall provide supervision of
investments, furnish a continuous investment program for each
Fund, determine from time to time what investments or Securities
will be purchased, retained or sold by each Fund, and what portion
of the assets will be invested or held uninvested as cash;
(b) The Adviser, in the performance of its duties
and obligations under this Agreement, shall act in conformity with
the Master Trust Agreement, By-Laws and Registration Statement
of the Investment Company and with the instructions and
directions of the Board of Trustees of the Investment Company,
provided, however, the Adviser shall not be responsible for acting
contrary to any of the foregoing that are changed without notice
of such change to the Adviser; and the Adviser shall conform to and
comply with the applicable requirements of the 1940 Act and all
other applicable federal or state laws and regulations.
(c) The Adviser shall promptly communicate to
the officers and Trustees of the Investment Company such
information relating to Fund transactions as they may reasonably
request. On occasions when the Adviser deems the purchase or
sale of a security to be in the best interest of a Fund as well as
other clients, the Adviser, to the extent permitted by applicable
laws and regulations, may aggregate the securities to be sold or
purchased, provided that, in the opinion of the Adviser, all
accounts are treated equitably and fairly. In such event,
allocation of the securities so purchased or sold, as well as
the expenses incurred in the transaction, shall be made by the
Adviser in the manner it considers to be the most equitable and
consistent with its fiduciary obligations to the Investment
Company and to such other clients.
(d) The Adviser shall maintain books and records
with respect to the Investment Companys securities transactions
and shall render to the Investment Company's Board of Trustees
such periodic and special reports as the Board may reasonably
request.
(e) The Adviser shall provide the Investment
Company with a list of all securities transactions as reasonably
requested by the Investment Company.
(f) The investment advisory services of the
Adviser to the Investment Company under this Agreement are not
to be deemed exclusive, and the Adviser shall be free to render
similar services to others.
3. EXECUTION AND ALLOCATION OF PORTFOLIO
BROKERAGE COMMISSION. The Adviser, subject to and in
accordance with any directions which the Investment Companys
Board of Trustees may issue from time to time, shall place, in the
name of the Investment Company, orders for the execution of the
securities transactions in which any Fund is authorized to invest.
When placing such orders, the primary objective of the Adviser
shall be to obtain the best net price and execution for the
Investment Company, but this requirement shall not be deemed to
obligate the Adviser to place any order solely on the basis of
obtaining the lowest commission rate if the other standards set
forth in this section have been satisfied. The Investment Company
recognizes that there are likely to be many cases in which
different brokers are equally able to provide such best price
and execution and that, in selecting among such brokers with
respect to particular trades, it is desirable to choose those
brokers who furnish brokerage and research services (as defined
in Section 28(e)(3) of the Securities and Exchange Act of 1934)
or statistical quotations and other information to the Investment
Company and/or the Adviser in accordance with the standards set
forth below. Moreover, to the extent that it continues to be
lawful to do so and so long as the Board determines as a matter
of general policy that the Investment Company will benefit,
directly or indirectly, by doing so, the Adviser may place
orders with a broker who charges a commission for that transaction
which is in excess of the amount of commission that another broker
would have charged for effecting that transaction, provided that
the excess commission is reasonable in relation to the value of
brokerage and research services provided by that broker.
Accordingly, the Investment Company and the Adviser agree that
the Adviser shall select brokers for the execution of any Funds
securities transactions from among:
(a) Those brokers and dealers who provide
brokerage and research services, or statistical quotations and other
information to the Investment Company, specifically including the
quotations necessary to determine the Investment Companys net
assets, in such amount of total brokerage as may reasonably be
required in light of such services.
(b) Those brokers and dealers who supply
brokerage and research services to the Adviser and/or its affiliated
corporations which relate directly to portfolio securities, actual or
potential, of the Investment Company, or which place the Adviser
in a better position to make decisions in connection with the
management of the Investment Company's assets, whether or not
such data may also be useful to the Adviser and its affiliates in
managing other portfolios or advising other clients, in such
amount of total brokerage as may reasonably be required.
The Adviser agrees that no investment decision will be
made or influenced by a desire to provide brokerage for allocation
in accordance with the foregoing, and that the right to make such
allocation of brokerage shall not interfere with the Advisers
primary duty to obtain the best net price and execution for the
Investment Company.
4. BOOKS AND RECORDS. The Adviser shall keep the
Investment Companys books and records required to be
maintained by it pursuant to paragraph 2(d) hereof. The Adviser
agrees that all records which it maintains for the Investment
Company are the property of the Investment Company and it shall
surrender promptly to the Investment Company any of such
records upon the Investment Companys request. The Adviser
further agrees to preserve for the periods prescribed by Rule 31a-2
of the Commission under the 1940 Act any such records as are
required to be maintained by Rule 31a-1(f) of the Commission
under the 1940 Act. Nothing herein shall prevent the Adviser
from maintaining its own records as required by law, which may
be a duplication of the Investment Company's records.
5. REPORTS TO ADVISER. The Investment Company
agrees to furnish the Adviser at its principal office all
prospectuses, proxy statements, reports to stockholders, sales
literature or other material prepared for distribution to
shareholders of the Investment Company or the public, which refer
in any way to the Adviser, ten (10) days prior to use thereof and
not to use such material if the Adviser should object thereto in
writing within seven (7) days after receipt of such material;
provided, however, that the Adviser hereby approves all uses of its
name which merely refer in accurate terms to its appointment as
investment adviser hereunder, which merely identifies the
Investment Company, or which are required by the Securities and
Exchange Commission or a state securities commission. In the
event of termination of this Agreement, the Investment Company
shall, on written request of the Adviser, forthwith delete any
reference to the Adviser from any materials described in the
preceding sentence. The Investment Company shall furnish or
otherwise make available to the Adviser such other information
relating to the business affairs of the Investment Company as the
Adviser at any time, or from time to time, reasonably requests in
order to discharge its obligations hereunder.
6. PROXIES. Unless the Investment Company gives
written instructions to the contrary, the Adviser shall vote or not
vote all proxies solicited by or with respect to the issuers of
securities in which assets of any Fund may be invested. The
Adviser shall use its best good faith judgment to vote or not vote
such proxies in a manner which best serves the interests of the
Investment Company's shareholders.
7. EXPENSES. During the term of this Agreement, the
Adviser shall pay all of its own expenses incurred by it in
connection with its activities under this Agreement and each Fund
of the Investment Company shall bear all expenses that are
incurred in its operations not specifically assumed by the Adviser.
Expenses borne by a Fund will include but not be limited
to the following (or the Funds proportionate share of the
following): (a) brokerage commissions relating to securities
purchased or sold by the Fund or any losses incurred in connection
therewith; (b) fees payable to and expenses incurred on behalf of
the Fund by the Investment Companys administrator; (c) expenses
of organizing the Investment Company and the Fund; (d) filing
fees and expenses relating to the registration and qualification of
the Fund's shares and the Investment Company under federal or
state securities laws and maintaining such registrations and
qualifications; (e) fees and salaries payable to the Investment
Companys Trustees and officers who are not officers or
employees of the Investment Companys administrator, any
investment adviser or underwriter of the Investment Company; (f)
taxes (including any income or franchise taxes) and governmental
fees; (g) costs of any liability, uncollectible items of deposit and
other insurance or fidelity bonds; (h) any costs, expenses or losses
arising out of any liability of or claim for damage or other relief
asserted against the Investment Company or the Fund for violation
of any law; (i) legal, accounting and auditing expenses, including
legal fees of special counsel for the independent Trustees; (j)
charges of custodians, transfer agents and other agents; (k) costs of
preparing share certificates (if any); (1) expenses of setting in type
and printing Prospectuses and Statements of Additional
Information and supplements thereto for existing shareholders,
reports and statements to shareholders and proxy material; (m) any
extraordinary expenses (including fees and disbursements of
counsel) incurred by the Investment Company or the Fund; and (n)
fees and other expenses incurred in connection with membership
in investment company organizations.
8. COMPENSATION OF THE ADVISER. For the
services to be rendered by the Adviser as provided in this
Agreement, the Investment Company shall pay to the Adviser such
compensation as is designated in Exhibit A to this Agreement, so
long as the Adviser has not waived all or a portion of such
compensation.
9. LIMITATION OF ADVISERS LIABILITY. In the
absence of (a) willful misfeasance, bad faith or gross negligence
on the part of the Adviser in performance of its obligations and
duties hereunder, (b) reckless disregard by the Adviser of its
obligations and duties hereunder, or (c) a loss resulting from a
breach of fiduciary duty with respect to the receipt of
compensation for services (in which case, any award of damages
shall be limited to the period and the amount set forth in Section
36(b)(3) of the 1940 Act), the Adviser shall not be subject to any
liability whatsoever to the Investment Company, or to any
shareholder of the Investment Company, for any error of
judgment, mistake of law or any other act or omission in the
course of, or connected with, rendering services hereunder
including, without limitation, for any losses that may be sustained
in connection with the purchase, holding, redemption or sale of
any security on behalf of the Investment Company.
10. DURATION AND TERMINATION.
(a) This Agreement shall become effective with
respect to the Initial Funds on the date hereof and, with respect to
each Additional Fund, on the date agreed to by the Adviser and the
Investment Company so long as, with respect to any Additional
Fund, the provisions of Section 1(b) have been complied with.
This Agreement, unless sooner terminated as provided herein,
shall continue for each Fund for two years following the effective
date of this Agreement with respect to the Fund, or the date of the
first annual or special meeting of the shareholders of the Fund
following such effective date, if approved by a majority of the
outstanding voting securities of the Fund (as defined in the 1940
Act), and thereafter shall continue automatically for periods of one
year so long as such continuance is specifically approved at least
annually (a) by the vote of a majority of those members of the
Board of Trustees of the Investment Company who are not parties
to this Agreement or interested persons (as defined in the 0000
Xxx) of any such party, cast in person at a meeting called for the
purpose of voting such approval, and (b) by the Board of Trustees
of the Investment Company or by vote of a majority of the
outstanding voting securities of the Fund.
(b) This Agreement may be terminated by the
Investment Company at any time, without the payment of any
penalty, by vote of a majority of those members of the Board of
Trustees who are not interested persons (as defined in the 0000
Xxx) of the Adviser or the Investment Company or by the majority
vote of either the entire Board of Trustees of the Investment
Company or by vote of a majority of the outstanding voting
securities of the Fund on 60 days written notice to the Adviser.
This Agreement may also be terminated by the Adviser on 90
days written notice to the Investment Company. This Agreement
will automatically and immediately terminate in the event of its
assignment (as defined in the 1940 Act).
11. CHOICE OF LAW. This Agreement shall be
construed in accordance with the laws of the Commonwealth of
Massachusetts and any applicable federal law.
12. LIMITATION OF LIABILITY. The Master Trust
Agreement dated June 15, 1995, as amended from time to time,
establishing the Investment Company, which is hereby referred to
and a copy of which is on file with the Secretary of The
Commonwealth of Massachusetts, provides that the name
Navigator Securities Lending Trust means the Trustees from time
to time serving (as Trustees but not personally) under said Master
Trust Agreement. It is expressly acknowledged and agreed that
the obligations of the Investment Company hereunder shall not be
binding upon any of the Shareholders, Trustees, officers,
employees or agents of the Investment Company, personally, but
shall bind only the trust property of the Investment Company, as
provided in its Master Trust Agreement. The execution and
delivery of this Agreement have been authorized by the Trustees
of the Investment Company and signed by an officer of the
Investment Company, acting as such, and neither such
authorization by such Trustees nor such execution and delivery by
such officer shall be deemed to have been made by any of them
individually or to impose any liability on any of them personally,
but shall bind only the trust property of the Investment Company
as provided in its Master Trust Agreement.
IN WITNESS WHEREOF, the due execution hereof as of the date
first above written.
Attest: NAVIGATOR
SECURITIES LENDING TRUST
By: /s/Xxxxx Xxxxx By: /s/ Cinzia Liambo
Xxxxx Xxxxx Name: Cinzia Liambo
Title: Vice President
Attest: SSGA FUNDS
MANAGEMENT, INC.
By: /s/Xxxx Xxxxxx By: /s/Xxxxxxx X. Xxxx,
Xx.
Xxxx Xxxxxx Name: Xxxxxxx X. Xxxx,
Xx.
Title: President
EXHIBIT A
As consideration for the Advisers services to the
following Fund(s), the Adviser shall receive from the Fund(s) an
annual advisory fee, accrued daily at the rate of 1/365th of the
applicable advisory fee rate and payable monthly on the first
business day of each month, of the following annual percentages
of the Fund's average daily net assets during the month:
Fund
Rate
Navigator Government Portfolio
0.0175%
Navigator Prime Portfolio
0.0175%
Navigator Short-Term Bond Portfolio
0.05%
