MANAGEMENT AGREEMENT
This Agreement is made as of July 2, 1993, between Income
Managers Trust, a New York common law trust ("Managers Trust"), and
Xxxxxxxxx & Xxxxxx Management Incorporated, a New York corporation
("Manager").
W I T N E S S E T H :
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WHEREAS, Managers Trust is registered under the Investment Company
Act of 1940, as amended ("1940 Act"), as an open-end, diversified
management investment company and has established several separate series
of shares ("Series"), with each Series having its own assets and
investment policies; and
WHEREAS, Managers Trust desires to retain the Manager as investment
adviser to furnish investment advisory and portfolio management services
to each Series listed in Schedule A attached hereto, to such other Series
of Managers Trust hereinafter established as agreed to from time to time
by the parties, evidenced by an addendum to Schedule A (hereinafter
"Series" shall refer to each Series which is subject to this Agreement and
all agreements and actions described herein to be made or taken by
Managers Trust on behalf of the Series), and the Manager is willing to
furnish such services;
NOW, THEREFORE, in consideration of the premises and mutual
covenants herein contained, it is agreed between the parties hereto as
follows:
1. SERVICES OF THE MANAGER.
1.1 INVESTMENT MANAGEMENT SERVICES. The Manager shall act
as the investment adviser to the Series and, as such, shall (i) obtain and
evaluate such information relating to the economy, industries, businesses,
securities markets and securities as it may deem necessary or useful in
discharging its responsibilities hereunder, (ii) formulate a continuing
program for the investment of the assets of the Series in a manner
consistent with its investment objectives, policies and restrictions, and
(iii) determine from time to time securities to be purchased, sold,
retained or lent by the Series, and implement those decisions, including
the selection of entities with or through which such purchases, sales or
loans are to be effected; PROVIDED, that the Manager will place orders
pursuant to its investment determinations either directly with the issuer
or with a broker or dealer, and if with a broker or dealer, (a) will
attempt to obtain the best net price and most favorable execution of its
orders, and (b) may nevertheless in its discretion purchase and sell
portfolio securities from and to brokers and dealers who provide the
Manager with research, analysis, advice and similar services and pay such
brokers and dealers in return a higher commission or spread than may be
charged by other brokers or dealers.
The Series hereby authorizes any entity or person associated
with the Manager which is a member of a national securities exchange to
effect any transaction on the exchange for the account of the Series which
is permitted by Section 11(a) of the Securities Exchange Act of 1934 and
Rule 11a2-2(T) thereunder, and the Series hereby consents to the retention
of compensation for such transactions in accordance with Rule
11a2-2(T)(a)(iv).
The Manager shall carry out its duties with respect to the
Series's investments in accordance with applicable law and the investment
objectives, policies and restrictions of the Series adopted by the
trustees of Managers Trust ("Trustees"), and subject to such further
limitations as the Series may from time to time impose by written notice
to the Manager.
1.2 ADMINISTRATIVE SERVICES. The Manager shall supervise
the Series's business and affairs and shall provide such services required
for effective administration of the Series as are not provided by
employees or other agents engaged by the Series; PROVIDED, that the
Manager shall not have any obligation to provide under this Agreement any
direct or indirect services to the holders of interests in the Series
("Interestholders"), any services related to the sale of interests in the
Series, or any other services which are the subject of a separate
agreement or arrangement between the Series and the Manager. Subject to
the foregoing, in providing administrative services hereunder, the Manager
shall:
1.2.1 OFFICE SPACE, EQUIPMENT AND FACILITIES. Furnish
without cost to the Series, or pay the cost of, such office space, office
equipment and office facilities as are adequate for the Series's needs.
1.2.2 PERSONNEL. Provide, without remuneration from or
other cost to Managers Trust or the Series, the services of individuals
competent to perform all of the Series's executive, administrative and
clerical functions which are not performed by employees or other agents
engaged by the Series or by the Manager acting in some other capacity
pursuant to a separate agreement or arrangement with the Series.
1.2.3 AGENTS. Assist the Series in selecting and
coordinating the activities of the other agents engaged by the Series,
including the Series's custodian, independent auditors and legal counsel.
1.2.4 TRUSTEES AND OFFICERS. Authorize and permit the
Manager's directors, officers and employees who may be elected or
appointed as trustees or officers of Managers Trust to serve in such
capacities, without remuneration from or other cost to Managers Trust or
the Series.
1.2.5 BOOKS AND RECORDS. Assure that all financial,
accounting and other records required to be maintained and preserved by
Managers Trust and/or the Series are maintained and preserved by it or on
its behalf in accordance with applicable laws and regulations.
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1.2.6 REPORTS AND FILINGS. Assist in the preparation
of (but not pay for) all periodic reports by Managers Trust or the Series
to Interestholders of the Series and all reports and filings required to
maintain the registration and qualification of the Series, or to meet
other regulatory or tax requirements applicable to the Series, under
federal and state securities and tax laws.
2. EXPENSES OF THE SERIES.
2.1 EXPENSES TO BE PAID BY THE MANAGER. The Manager shall
pay all salaries, expenses and fees of the officers, trustees and
employees of the Managers Trust who are officers, directors or employees
of the Manager.
In the event that the Manager pays or assumes any expenses of
Managers Trust or a Series not required to be paid or assumed by the
Manager under this Agreement, the Manager shall not be obligated hereby to
pay or assume the same or any similar expense in the future; PROVIDED,
that nothing herein contained shall be deemed to relieve the Manager of
any obligation to Managers Trust or to a Series under any separate
agreement or arrangement between the parties.
2.2 EXPENSES TO BE PAID BY THE SERIES. Each Series shall
bear all expenses of its operation, except those specifically allocated to
the Manager under this Agreement or under any separate agreement between a
Series and the Manager. Expenses to be borne by a Series shall include
both expenses directly attributable to the operation of the Series and the
placement of interests therein, as well as the portion of any expenses of
Managers Trust that is properly allocable to the Series in a manner
approved by the trustees of Managers Trust. Subject to any separate
agreement or arrangement between Managers Trust or a Series and the
Manager, the expenses hereby allocated to each Series, and not to the
Manager, include, but are not limited to:
2.2.1 CUSTODY. All charges of depositories,
custodians, and other agents for the transfer, receipt, safekeeping, and
servicing of its cash, securities, and other property.
2.2.2 INTERESTHOLDER SERVICING. All expenses of
maintaining and servicing Interestholder accounts, including but not
limited to the charges of any Interestholder servicing agent, dividend
disbursing agent or other agent engaged by a Series to service
Interestholder accounts.
2.2.3 INTERESTHOLDER REPORTS. All expenses of
preparing, setting in type, printing and distributing reports and other
communications to Interestholders of a Series.
2.2.4 PRICING AND PORTFOLIO VALUATION. All expenses of
computing a Series's net asset value per share, including any equipment or
services obtained for the purpose of pricing shares or valuing the
Series's investment portfolio.
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2.2.5 COMMUNICATIONS. All charges for equipment or
services used for communications between the Manager or the Series and any
custodian, Interestholder servicing agent, portfolio accounting services
agent, or other agent engaged by a Series.
2.2.6 LEGAL AND ACCOUNTING FEES. All charges for
services and expenses of a Series's legal counsel and independent
auditors.
2.2.7 TRUSTEES' FEES AND EXPENSES. With respect to
each Series, all compensation of Trustees other than those affiliated with
the Manager, all expenses incurred in connection with such unaffiliated
Trustees' services as Trustees, and all other expenses of meetings of the
Trustees or committees thereof.
2.2.8 INTERESTHOLDER MEETINGS. All expenses incidental
to holding meetings of Interestholders, including the printing of notices
and proxy materials, and proxy solicitation therefor.
2.2.9 BONDING AND INSURANCE. All expenses of bond,
liability, and other insurance coverage required by law or regulation or
deemed advisable by the Trustees, including, without limitation, such
bond, liability and other insurance expense that may from time to time be
allocated to the Series in a manner approved by the Trustees.
2.2.10 BROKERAGE COMMISSIONS. All brokers'
commissions and other charges incident to the purchase, sale or lending of
a Series's portfolio securities.
2.2.11 TAXES. All taxes or governmental fees payable
by or with respect to a Series to federal, state or other governmental
agencies, domestic or foreign, including stamp or other transfer taxes.
2.2.12 TRADE ASSOCIATION FEES. All fees, dues and
other expenses incurred in connection with a Series's membership in any
trade association or other investment organization.
2.2.13 NONRECURRING AND EXTRAORDINARY EXPENSES. Such
nonrecurring and extraordinary expenses as may arise, including the costs
of actions, suits, or proceedings to which the Series is a party and the
expenses a Series may incur as a result of its legal obligation to provide
indemnification to Managers Trust's officers, Trustees and agents.
2.2.14 ORGANIZATIONAL EXPENSES. Any and all
organizational expenses of a Series paid by the Manager shall be
reimbursed by such Series at such time or times agreed by such Series and
the Manager.
3. ADVISORY FEE.
3.1 FEE. As compensation for all services rendered,
facilities provided and expenses paid or assumed by the Manager under this
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Agreement, each Series shall pay the Manager an annual fee as set out in
Schedule B to this Agreement.
3.2 COMPUTATION AND PAYMENT OF FEE. The advisory fee shall
accrue on each calendar day, and shall be payable monthly on the first
business day of the next succeeding calendar month. The daily fee
accruals shall be computed by multiplying the fraction of one divided by
the number of days in the calendar year by the applicable annual advisory
fee rate (as set forth in Schedule B hereto), and multiplying this product
by the net assets of the Series, determined in the manner established by
the Trustees, as of the close of business on the last preceding business
day on which the Series's net asset value was determined.
3.3 STATE EXPENSE LIMITATION. If in any fiscal year the
operating expenses of any Interestholder in a Series plus such
Interestholder's pro rata portion of the Series' operating expenses in
such fiscal year ("Aggregate Operating Expenses", which includes any fees
or expense reimbursements payable to the Manager pursuant to this
Agreement and any compensation payable to the Manager pursuant to (i) the
Administration Agreement between such Interestholder and the Manager or
(ii) any other Agreement or arrangement with Managers Trust with respect
to that Interestholder, but excludes interest, taxes, brokerage
commissions, litigation and indemnification expenses, and other
extraordinary expenses not incurred in the ordinary course of business)
exceed the lowest applicable percentage expense limitation imposed under
the securities law and regulations of any state in which such
Interestholder's shares are qualified for sale (the "State Expense
Limitation"), then the Manager shall pay such Interestholder the amount of
such excess, less the amount of any reduction of the administration fee
referred to below; PROVIDED, that the Manager shall have no obligation
hereunder to pay such Interestholder for any such expenses which exceed
the pro rata portion of such advisory fee attributable to such
Interestholder's interest in that Series.
No payment shall be made to such Interestholder hereunder
unless and until the administration fee payable by such Interestholder
under a similar State Expense Limitation of its Administration Agreement
with the Manager has been reduced to zero. Any payment to an
interestholder hereunder shall be made monthly, by annualizing the
Aggregate Operating Expenses for each month as of the last day of such
month. An adjustment shall be made on or before the last day of the first
month of the next succeeding fiscal year if Aggregate Operating Expenses
for such fiscal year do not exceed the State Expense Limitation or if for
such fiscal year there is no applicable State Expense Limitation.
4. OWNERSHIP OF RECORDS.
All records required to be maintained and preserved by the
Series pursuant to the provisions or rules or regulations of the
Securities and Exchange Commission under Section 31(a) of the 1940 Act and
maintained and preserved by the Manager on behalf of the Series are the
property of the Series and shall be surrendered by the Manager promptly on
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request by the Series; PROVIDED, that the Manager may at its own expense
make and retain copies of any such records.
5. REPORTS TO MANAGER.
The Series shall furnish or otherwise make available to the
Manager such copies of that Series's financial statements, proxy
statements, reports, and other information relating to its business and
affairs as the Manager may, at any time or from time to time, reasonably
require in order to discharge its obligations under this Agreement.
6. REPORTS TO THE SERIES.
The Manager shall prepare and furnish to the Series such
reports, statistical data and other information in such form and at such
intervals as the Series may reasonably request.
7. RETENTION OF SUB-ADVISER.
Subject to a Series obtaining the initial and periodic
approvals required under Section 15 of the 1940 Act, the Manager may
retain a sub-adviser, at the Manager's own cost and expense, for the
purpose of making investment recommendations and research information
available to the Manager. Retention of a sub-adviser shall in no way
reduce the responsibilities or obligations of the Manager under this
Agreement and the Manager shall be responsible to Managers Trust and the
Series for all acts or omissions of the sub-adviser in connection with the
performance of the Manager's duties hereunder.
8. SERVICES TO OTHER CLIENTS.
Nothing herein contained shall limit the freedom of the
Manager or any affiliated person of the Manager to render investment
management and administrative services to other investment companies, to
act as investment adviser or investment counselor to other persons, firms
or corporations, or to engage in other business activities.
9. LIMITATION OF LIABILITY OF MANAGER AND ITS PERSONNEL.
Neither the Manager nor any director, officer or employee of
the Manager performing services for the Series at the direction or request
of the Manager in connection with the Manager's discharge of its
obligations hereunder shall be liable for any error of judgment or mistake
of law or for any loss suffered by a Series in connection with any matter
to which this Agreement relates; PROVIDED, that nothing herein contained
shall be construed (i) to protect the Manager against any liability to
Managers Trust or a Series or its Interestholders to which the Manager
would otherwise be subject by reason of willful misfeasance, bad faith, or
gross negligence in the performance of the Manager's duties, or by reason
of the Manager's reckless disregard of its obligations and duties under
this Agreement, or (ii) to protect any director, officer or employee of
the Manager who is or was a Trustee or officer of Managers Trust against
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any liability to Managers Trust or a Series or its Interestholders to
which such person would otherwise be subject by reason of willful
misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in the conduct of such person's office with Managers
Trust.
10. NO LIABILITY OF OTHER SERIES.
This Agreement is made by each Series pursuant to authority
granted by the Trustees, and the obligations created hereby are not
binding on any of the Trustees or Interestholders of the Series
individually, but bind only the property of that Series and no other.
11. EFFECT OF AGREEMENT.
Nothing herein contained shall be deemed to require the
Series to take any action contrary to the Declaration of Trust or By-Laws
of Managers Trust, any actions of the Trustees binding upon the Series, or
any applicable law, regulation or order to which the Series is subject or
by which it is bound, or to relieve or deprive the Trustees of their
responsibility for and control of the conduct of the business and affairs
of the Series or Managers Trust.
12. TERM OF AGREEMENT.
The term of this Agreement shall begin on the date first
above written with respect to each Series listed in Schedule A on the date
hereof and, unless sooner terminated as hereinafter provided, this
Agreement shall remain in effect through July 2, 1995. With respect to
each Series added by execution of an Addendum to Schedule A, the term of
this Agreement shall begin on the date of such execution and, unless
sooner terminated as hereinafter provided, this Agreement shall remain in
effect to the date two years after such execution. Thereafter, in each
case this Agreement shall continue in effect with respect to each Series
from year to year, subject to the termination provisions and all other
terms and conditions hereof; PROVIDED, such continuance with respect to a
Series is approved at least annually by vote or written consent of the
Trustees, including a majority of the Trustees who are not interested
persons of either party hereto ("Disinterested Trustees"); and PROVIDED
FURTHER, that the Manager shall not have notified a Series in writing at
least sixty days prior to the first expiration date hereof or at least
sixty days prior to any expiration date in any year thereafter that it
does not desire such continuation. The Manager shall furnish any Series,
promptly upon its request, such information as may reasonably be necessary
to evaluate the terms of this Agreement or any extension, renewal or
amendment thereof.
13. AMENDMENT OR ASSIGNMENT OF AGREEMENT.
Any amendment to this Agreement shall be in writing signed by
the parties hereto; PROVIDED, that no such amendment shall be effective
unless authorized on behalf of any Series (i) by resolution of the
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Trustees, including the vote or written consent of a majority of the
Trustees who are not parties to this Agreement or interested persons of
either party hereto, and (ii) by vote of a majority of the outstanding
voting securities of the Series. This Agreement shall terminate
automatically and immediately in the event of its assignment.
14. TERMINATION OF AGREEMENT.
This Agreement may be terminated at any time by either party
hereto, without the payment of any penalty, upon sixty (60) days' prior
written notice to the other party; PROVIDED, that in the case of
termination by any Series, such action shall have been authorized (i) by
resolution of the Trustees, including the vote or written consent of a
majority of Trustees who are not parties to this Agreement or interested
persons of either party hereto, or (ii) by vote of a majority of the
outstanding voting securities of the Series.
15. NAME OF THE SERIES.
Each Series hereby agrees that if the Manager shall at any
time for any reason cease to serve as investment adviser to a Series, the
Series shall, if and when requested by the Manager, eliminate from the
Series's name the name "Xxxxxxxxx & Xxxxxx" and thereafter refrain from
using the name "Xxxxxxxxx & Xxxxxx" or the initials "N&B" in connection
with its business or activities, and the foregoing agreement of a Series
shall survive any termination of this Agreement and any extension or
renewal thereof.
16. INTERPRETATION AND DEFINITION OF TERMS.
Any question of interpretation of any term or provision of
this Agreement having a counterpart in or otherwise derived from a term or
provision of the 1940 Act shall be resolved by reference to such term or
provision of the 1940 Act and to interpretation thereof, if any, by the
United States courts or, in the absence of any controlling decision of any
such court, by rules, regulations or orders of the Securities and Exchange
Commission validly issued pursuant to the 1940 Act. Specifically, the
terms "vote of a majority of the outstanding voting securities,"
"interested persons," "assignment" and "affiliated person," as used in
this Agreement shall have the meanings assigned to them by Section 2(a) of
the 1940 Act. In addition, when the effect of a requirement of the 1940
Act reflected in any provision of this Agreement is modified, interpreted
or relaxed by a rule, regulation or order of the Securities and Exchange
Commission, whether of special or of general application, such provision
shall be deemed to incorporate the effect of such rule, regulation or
order.
17. CHOICE OF LAW
This Agreement is made and to be principally performed in the
State of New York, and except insofar as the 1940 Act or other federal
laws and regulations may be controlling, this Agreement shall be governed
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by, and construed and enforced in accordance with, the internal laws of
the State of New York.
18. CAPTIONS.
The captions in this Agreement are included for convenience
of reference only and in no way define or delineate any of the provisions
hereof or otherwise affect their construction or effect.
19. EXECUTION IN COUNTERPARTS.
This Agreement may be executed simultaneously in counter-
parts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be signed by their respective officers thereunto duly
authorized and their respective seals to be hereunto affixed, as of the
day and year first above written.
INCOME MANAGERS TRUST
By /s/ Xxxxxx X. Xxxxxxxx
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Vice President
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Title
XXXXXXXXX & XXXXXX
MANAGEMENT INCORPORATED
By /s/ Xxxxxxx X. Xxxxxx
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Senior Vice President
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Title
Attest:
/s/ Xxxxxxx X. Xxxxxxx
-----------------------
Secretary
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