Exhibit 99.23(d)(3)
XXXX XXXXXXXXX SERIES TRUST
MANAGEMENT CONTRACT
Management Contract executed as of January 30, 2004, between XXXX XXXXXXXXX
SERIES TRUST, a Massachusetts business trust (the "Trust"), on behalf of the
Laudus Xxxxxxxxx Value Long/Short Equity Fund (the "Fund"), and XXXXXXX XXXXXX
INVESTMENT MANAGEMENT, INC., a Delaware corporation (the "Manager").
WITNESSETH:
That in consideration of the mutual covenants herein contained, it is agreed as
follows:
1. SERVICES TO BE RENDERED BY MANAGER TO THE TRUST.
(a) Subject always to the control of the trustees of the Trust (the "Trustees")
and to such policies as the Trustees may determine, the Manager will, at
its expense, (i) furnish continuously an investment program for the Fund
and will make investment decisions on behalf of the Fund and place all
orders for the purchase and sale of its portfolio securities, and (ii)
furnish all necessary office space and equipment, provide bookkeeping and
clerical services required to perform its duties in clause (i) above and
pay all salaries, fees and expenses of the Trustees and officers of the
Trust who are affiliated persons of the Manager. In the performance of its
duties, the Manager will comply with the provisions of the Second Amended
and Restated Agreement and Declaration of Trust and By-laws of the Trust,
each as amended from time to time, and the Fund's stated investment
objectives, policies and restrictions.
(b) In the selection of brokers, dealers or futures commissions merchants
(collectively, "brokers") and the placing of orders for the purchase and
sale of portfolio investments for the Fund, the Manager shall seek to
obtain the most favorable price and execution available, except to the
extent it may be permitted to pay higher brokerage commissions for
brokerage and research services as described below. In using its best
efforts to obtain for the Fund the most favorable price and execution
available, the Manager, bearing in mind the Fund's best interests at all
times, shall consider all factors it deems relevant, including, by way of
illustration, the price, the size of the transaction, the nature of the
market for the security, the amount of the commission, the timing of the
transaction taking into account market prices and trends, the reputation,
experience and financial stability of the broker involved and the quality
of service rendered by the broker in other transactions. Subject to such
policies as the Trustees may determine, the Manager shall not be deemed to
have acted unlawfully or to have breached any duty created by this Contract
or otherwise solely by reason of its having caused the Trust to pay, on
behalf of the Fund, a broker that provides brokerage and research services
to the Manager or any affiliated person of the Manager an amount of
commission for effecting a portfolio investment transaction in excess of
the amount of commission another broker would have charged for effecting
that transaction, if the Manager determines in good faith that such amount
of commission was reasonable in relation to the value of the brokerage and
research
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services provided by such broker, viewed in terms of either that particular
transaction or the Manager's overall responsibilities with respect to the
Fund and to other clients of the Manager and any affiliated person of the
Manager as to which the Manager or any affiliated person of the Manager
exercises investment discretion.
(c) Notwithstanding Section 1(a) above and subject to the provisions of the
Second Amended and Restated Agreement and Declaration of Trust of the Trust
and the Investment Company Act of 1940, as amended (the "1940 Act"), the
Manager, at its expense, may select and contract with an investment
sub-adviser (the "Subadviser") for the Fund to perform, subject to the
supervision of the Manager, some or all of the services for which it is
responsible pursuant to paragraphs (a) and (b) of this Section 1
(including, but not limited to, the selection of brokers). The Manager will
compensate the Subadviser for its services to the Fund.
(d) The Manager shall not be obligated to pay any expenses of or for the Trust
or of or for the Fund not expressly assumed by the Manager pursuant to this
Section 1 other than as provided in Section 3.
2. OTHER AGREEMENTS, ETC.
It is understood that any of the shareholders, Trustees, officers and employees
of the Trust may be a shareholder, partner, director, officer or employee of, or
be otherwise interested in, the Manager, and in any person controlling,
controlled by or under common control with the Manager, and that the Manager and
any person controlling, controlled by or under common control with the Manager
may have an interest in the Trust. It is also understood that the Manager and
persons controlling, controlled by or under common control with the Manager have
and may have advisory, management service, distribution or other contracts with
other organizations and persons, and may have other interests and businesses.
3. COMPENSATION TO BE PAID BY THE TRUST TO THE MANAGER.
The Fund will pay to the Manager as compensation for the Manager's services
rendered, for the facilities furnished and for the expenses borne by the Manager
pursuant to Section 1, a fee, computed and paid monthly at the annual rate
(based on the number of days elapsed through the end of the month) of 1.50% of
the Fund's net assets up to $500 million and 1.45% of the Fund's net assets over
$500 million, each as of the last business day of the month. Such fee shall be
payable for each month within five (5) business days after the end of such
month.
In the event that the expenses of the Fund exceed any expense limitation which
the Manager may, by written notice to the Trust, voluntarily declare to be
effective with respect to the Fund, subject to such terms and conditions as the
Manager may prescribe in such notice, the compensation due the Manager shall be
reduced, and, if necessary, the Manager shall bear the Fund's expenses to the
extent required by such expense limitation.
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If the Manager shall serve for less than the whole of a month, the foregoing
compensation shall be prorated.
4. ASSIGNMENT TERMINATES THIS CONTRACT; AMENDMENTS OF THIS CONTRACT.
This Contract shall automatically terminate, without the payment of any penalty,
in the event of its assignment (as defined in the 1940 Act); and this Contract
shall not be materially amended unless such amendment is approved by the
affirmative vote of a majority of the outstanding shares of the Fund, and by the
vote, cast in person at a meeting called for the purpose of voting on such
approval, of a majority of the Trustees who are not interested persons of the
Trust or of the Manager.
5. EFFECTIVE PERIOD AND TERMINATION OF THIS CONTRACT.
This Contract shall continue in effect until January 30, 2006 and thereafter for
successive annual periods, provided that such continuance is specifically
approved at least annually (a) by the affirmative vote of a majority of the
outstanding shares of the Fund or by the Trust's Board of Trustees, and (b) by
the vote of a majority of the Trust's trustees 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 on such
approval, or (c) as otherwise permitted by the 1940 Act or the rules and
regulations thereunder. This Contract may be terminated at any time by a vote of
a majority of the Fund's outstanding voting securities or by a vote of a
majority of the Trust's entire Board of Trustees on 60 days' written notice to
the Manager or by the Manager on 60 days' written notice to the Trust. Unless
terminated automatically as set forth in Section 4, this Agreement may only be
terminated in accordance with the provisions of this Section 5.
If the continuance of this Contract is submitted to the shareholders of the Fund
for their approval and such shareholders fail to approve such continuance of
this Contract as provided herein, the Manager may continue to serve hereunder in
a manner consistent with the 1940 Act and the rules and regulations thereunder.
6. CERTAIN DEFINITIONS.
For the purposes of this Contract, the "affirmative vote of a majority of the
outstanding shares" of the Fund means the affirmative vote, at a duly called and
held meeting of shareholders, (a) of the holders of 67% or more of the shares of
the Fund present (in person or by proxy) and entitled to vote at such meeting,
if the holders of more than 50% of the outstanding shares of the Fund entitled
to vote at such meeting are present in person or by proxy, or (b) of the holders
of more than 50% of the outstanding shares of the Fund entitled to vote at such
meeting, whichever is less.
For the purposes of this Contract, the terms "affiliated person," "control,"
"interested person" and "assignment" shall have their respective meanings
defined in the 1940 Act and the rules and regulations thereunder, subject,
however, to such exemptions as may be
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granted by the Securities and Exchange Commission under said Act; the term
"specifically approve at least annually" shall be construed in a manner
consistent with the 1940 Act and the rules and regulations thereunder; and the
term "brokerage and research services" shall have the meaning given in the 1934
Act and the rules and regulations thereunder.
7. NONLIABILITY OF MANAGER.
In the absence of willful misfeasance, bad faith or gross negligence on the part
of the Manager, or reckless disregard of its obligations and duties hereunder,
the Manager shall not be subject to any liability to the Trust, to the Fund or
to any shareholder, officer, director or Trustee thereof, for any act or
omission in the course of, or connected with, rendering services hereunder.
8. LIMITATION OF LIABILITY OF THE TRUSTEES AND SHAREHOLDERS.
A copy of the Second Amended and Restated Agreement and Declaration of Trust of
the Trust is on file with the Secretary of State of The Commonwealth of
Massachusetts, and notice is hereby given that this instrument is executed on
behalf of the Trustees as Trustees and not individually and that the obligations
of this instrument are not binding upon any of the Trustees or shareholders
individually but are binding only upon the assets and property of the Fund.
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IN WITNESS WHEREOF, XXXX XXXXXXXXX SERIES TRUST and XXXXXXX XXXXXX INVESTMENT
MANAGEMENT, INC. have each caused this instrument to be signed in duplicate on
its behalf by its duly authorized representative, all as of the day and year
first above written.
XXXX XXXXXXXXX SERIES TRUST
By: /s/ Xxxx X. Xxxxxxxx
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Name: Xxxx X. Xxxxxxxx
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Title: President
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XXXXXXX XXXXXX INVESTMENT
MANAGEMENT, INC.
By: /s/ Xxxxxxx X. Xxxx
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Name: Xxxxxxx X. Xxxx
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Title: President and Chief Executive Officer
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