INVESTMENT ADVISORY AGREEMENT
AGREEMENT made as of the ___ day of _____________, 2002, by and between
XXXXXXXXXXX MULTI CAP VALUE FUND (the "Fund"), and OPPENHEIMERFUNDS, INC. ("OFI").
WHEREAS, the Fund is an open-end, diversified management investment company
registered as such with the Securities and Exchange Commission (the "Commission")
pursuant to the Investment Company Act of 1940 (the "Investment Company Act"), and OFI
is a registered investment adviser;
NOW, THEREFORE, in consideration of the mutual promises and covenants
hereinafter set forth, it is agreed by and between the parties, as follows:
1. General Provision.
The Fund hereby employs OFI and OFI hereby undertakes to act as the investment
adviser of the Fund and to perform for the Fund such other duties and functions as are
hereinafter set forth. OFI shall, in all matters, give to the Fund and its Board of
Trustees the benefit of its best judgment, effort, advice and recommendations and
shall, at all times conform to, and use its best efforts to enable the Fund to conform
to (i) the provisions of the Investment Company Act and any rules or regulations
thereunder; (ii) any other applicable provisions of state or federal law; (iii) the
provisions of the Declaration of Trust and By-Laws of the Fund as amended from time to
time; (iv) policies and determinations of the Board of Trustees of the Fund; (v) the
fundamental policies and investment restrictions of the Fund as reflected in its
registration statement under the Investment Company Act or as such policies may, from
time to time, be amended by the Fund's shareholders; and (vi) the Prospectus and
Statement of Additional Information of the Fund in effect from time to time. The
appropriate officers and employees of OFI shall be available upon reasonable notice
for consultation with any of the Trustees and officers of the Fund with respect to any
matters dealing with the business and affairs of the Fund including the valuation of
any of the Fund's portfolio securities which are either not registered for public sale
or not being traded on any securities market.
2. Investment Management.
(a) OFI shall, subject to the direction and control by the Fund's Board of
Trustees, (i) regularly provide investment advice and recommendations to the Fund with
respect to its investments, investment policies and the purchase and sale of
securities; (ii) supervise continuously the investment program of the Fund and the
composition of its portfolio and determine what securities shall be purchased or sold
by the Fund; and (iii) arrange, subject to the provisions of paragraph "7" hereof, for
the purchase of securities and other investments for the Fund and the sale of
securities and other investments held in the portfolio of the Fund.
(b) Provided that the Fund shall not be required to pay any compensation other
than as provided by the terms of this Agreement and subject to the provisions of
paragraph "7" hereof, OFI may obtain investment information, research or assistance
from any other person, firm or corporation to supplement, update or otherwise improve
its investment management services.
(c) Provided that nothing herein shall be deemed to protect OFI from willful
misfeasance, bad faith or gross negligence in the performance of its duties, or
reckless disregard of its obligations and duties under the Agreement, OFI shall not be
liable for any loss sustained by reason of good faith errors or omissions in
connection with any matters to which this Agreement relates.
(d) Nothing in this Agreement shall prevent OFI or any officer thereof from
acting as investment adviser for any other person, firm or corporation and shall not
in any way limit or restrict OFI or any of its directors, officers or employees from
buying, selling or trading any securities for its own account or for the account of
others for whom it or they may be acting, provided that such activities will not
adversely affect or otherwise impair the performance by OFI of its duties and
obligations under this Agreement and under the Investment Advisers Act of 1940.
3. Other Duties of OFI.
OFI shall, at its own expense, provide and supervise the activities of all
administrative and clerical personnel as shall be required to provide effective
corporate administration for the Fund, including the compilation and maintenance of
such records with respect to its operations as may reasonably be required; the
preparation and filing of such reports with respect thereto as shall be required by
the Commission; composition of periodic reports with respect to its operations for the
shareholders of the Fund; composition of proxy materials for meetings of the Fund's
shareholders and the composition of such registration statements as may be required by
federal securities laws for continuous public sale of shares of the Fund. OFI shall,
at its own cost and expense, also provide the Fund with adequate office space,
facilities and equipment.
4. Allocation of Expenses.
All other costs and expenses not expressly assumed by OFI under this
Agreement, or to be paid by the General Distributor of the shares of the Fund, shall
be paid by the Fund, including, but not limited to (i) interest and taxes; (ii)
brokerage commissions; (iii) premiums for fidelity and other insurance coverage
requisite to its operations; (iv) the fees and expenses of its Trustees; (v) legal and
audit expenses; (vi) custodian and transfer agent fees and expenses; (vii) expenses
incident to the redemption of its shares; (viii) expenses incident to the issuance of
its shares against payment therefor by or on behalf of the subscribers thereto; (ix)
fees and expenses, other than as hereinabove provided, incident to the registration
under federal securities laws of shares of the Fund for public sale; (x) expenses of
printing and mailing reports, notices and proxy materials to shareholders of the Fund;
(xi) except as noted above, all other expenses incidental to holding meetings of the
Fund's shareholders; and (xii) such extraordinary non-recurring expenses as may
arise, including litigation affecting the Fund and any obligation which the Fund may
have to indemnify its officers and Trustees with respect thereto. Any officers or
employees of OFI or any entity controlling, controlled by or under common control with
OFI, who may also serve as officers, Trustees or employees of the Fund shall not
receive any compensation from the Fund for their services.
5. Compensation of OFI.
The Fund agrees to pay OFI and OFI agrees to accept as full compensation for
the performance of all functions and duties on its part to be performed pursuant to
the provisions hereof, a management fee computed on the aggregate net assets of the
Fund as of the close of each business day and payable monthly at the following rates:
0.75% of the first $200 million of average annual net assets of the Fund, 0.72% of the
next $200 million, 0.69% of the next $200 million, 0.66% of the next $200 million, and
0.60% of average annual net assets in excess of $800 million.
6. Use of Name "Xxxxxxxxxxx."
OFI hereby grants to the Fund a royalty-free, non-exclusive license to use the
name "Xxxxxxxxxxx" in the name of the Fund for the duration of this Agreement and any
extensions or renewals thereof. Such license may, upon termination of this Agreement,
be terminated by OFI, in which event the Fund shall promptly take whatever action may
be necessary to change its name and discontinue any further use of the name
"Xxxxxxxxxxx" in the name of the Fund or otherwise. The name "Xxxxxxxxxxx" may be used
or licensed by OFI in connection with any of its activities or licensed by OFI to any
other party.
7. Portfolio Transactions and Brokerage.
(a) OFI is authorized, in arranging the Fund's portfolio transactions, to
employ or deal with such members of securities or commodities exchanges, brokers or
dealers, including "affiliated" broker dealers (as that term is defined in the
Investment Company Act) (hereinafter "broker-dealers"), as may, in its best judgment,
implement the policy of the Fund to obtain, at reasonable expense, the "best
execution" (prompt and reliable execution at the most favorable security price
obtainable) of the Fund's portfolio transactions as well as to obtain, consistent with
the provisions of subparagraph "(c)" of this paragraph "7," the benefit of such
investment information or research as may be of significant assistance to the
performance by OFI of its investment management functions.
(b) OFI shall select broker-dealers to effect the Fund's portfolio
transactions on the basis of its estimate of their ability to obtain best execution of
particular and related portfolio transactions. The abilities of a broker-dealer to
obtain best execution of particular portfolio transaction(s) will be judged by OFI on
the basis of all relevant factors and considerations including, insofar as feasible,
the execution capabilities required by the transaction or transactions; the ability
and willingness of the broker-dealer to facilitate the Fund's portfolio transactions
by participating therein for its own account; the importance to the Fund of speed,
efficiency or confidentiality; the broker-dealer's apparent familiarity with sources
from or to whom particular securities might be purchased or sold; as well as any other
matters relevant to the selection of a broker-dealer for particular and related
transactions of the Fund.
(c) OFI shall have discretion, in the interests of the Fund, to allocate
brokerage on the Fund's portfolio transactions to broker-dealers other than affiliated
broker-dealers, qualified to obtain best execution of such transactions who provide
brokerage and/or research services (as such services are defined in Section 23(e)(3)
of the Securities Exchange Act of 1934) for the Fund and/or other accounts for which
OFI and its affiliates exercise "investment discretion" (as that term is defined in
Section 3(a)(35) of the Securities Exchange Act of 1934) and to cause the Fund to pay
such broker-dealers a commission for effecting a portfolio transaction for the Fund
that is in excess of the amount of commission another broker-dealer adequately
qualified to effect such transaction would have charged for effecting that
transaction, if OFI determines, in good faith, that such commission is reasonable in
relation to the value of the brokerage and/or research services provided by such
broker-dealer, viewed in terms of either that particular transaction or the overall
responsibilities of OFI and its investment advisory affiliates with respect to the
accounts as to which they exercise investment discretion. In reaching such
determination, OFI will not be required to place or attempt to place a specific dollar
value on the brokerage and/or research services provided or being provided by such
broker-dealer. In demonstrating that such determinations were made in good faith, OFI
shall be prepared to show that all commissions were allocated for the purposes
contemplated by this Agreement and that the total commissions paid by the Fund over a
representative period selected by the Fund's trustees were reasonable in relation to
the benefits to the Fund.
(d) OFI shall have no duty or obligation to seek advance competitive bidding
for the most favorable commission rate applicable to any particular portfolio
transactions or to select any broker-dealer on the basis of its purported or "posted"
commission rate but will, to the best of its ability, endeavor to be aware of the
current level of the charges of eligible broker-dealers and to minimize the expense
incurred by the Fund for effecting its portfolio transactions to the extent consistent
with the interests and policies of the Fund as established by the determinations of
its Board of Trustees and the provisions of this paragraph "7."
(e) The Fund recognizes that an affiliated broker-dealer (i) may act as one of
the Fund's regular brokers so long as it is lawful for it so to act; (ii) may be a
major recipient of brokerage commissions paid by the Fund; and (iii) may effect
portfolio transactions for the Fund only if the commissions, fees or other
remuneration received or to be received by it are determined in accordance with
procedures contemplated by any rule, regulation or order adopted under the Investment
Company Act for determining the permissible level of such commissions.
(f) Subject to the foregoing provisions of this paragraph "7", OFI may also
consider sales of Fund shares and shares of other investment companies managed by OFI
or its affiliates as a factor in the selection of broker-dealers for the Fund's
portfolio transactions.
8. Duration.
This Agreement will take effect on the date first set forth above. Unless
earlier terminated pursuant to paragraph 9 hereof, this Agreement shall remain in
effect until two years from the date of execution hereof, and thereafter will continue
in effect from year to year, so long as such continuance shall be approved at least
annually by the Fund's Board of Trustees, including the vote of the majority of the
trustees of the Fund who are not parties to this Agreement or "interested persons" (as
defined in the Investment Company Act) of any such party, cast in person at a meeting
called for the purpose of voting on such approval, or by the holders of a "majority"
(as defined in the Investment Company Act) of the outstanding voting securities of the
Fund and by such a vote of the Fund's Board of Trustees.
9. Termination.
This Agreement may be terminated (i) by OFI at any time without penalty upon
giving the Fund sixty days' written notice (which notice may be waived by the Fund);
or (ii) by the Fund at any time without penalty upon sixty days' written notice to OFI
(which notice may be waived by OFI) provided that such termination by the Fund shall
be directed or approved by the vote of a majority of all of the Trustees of the Fund
then in office or by the vote of the holders of a "majority" (as defined in the
Investment Company Act) of the outstanding voting securities of the Fund.
10. Assignment or Amendment.
This Agreement may not be amended without the affirmative vote or written
consent of the holders of a "majority" of the outstanding voting securities of the
Fund, and shall automatically and immediately terminate in the event of its
"assignment," as defined in the Investment Company Act.
11. Disclaimer of Shareholder Liability.
OFI understands that the obligations of the Fund under this Agreement are not
binding upon any Trustee or shareholder of the Fund personally, but bind only the Fund
and the Fund's property. OFI represents that it has notice of the provisions of the
Declaration of Trust of the Fund disclaiming shareholder liability for acts or
obligations of the Fund.
12. Definitions.
The terms and provisions of this Agreement shall be interpreted and defined in
a manner consistent with the provisions and definitions of the Investment Company Act.
XXXXXXXXXXX MULTI CAP VALUE FUND
By:
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Xxxxxx X. Xxxx, Secretary
OPPENHEIMERFUNDS, INC.
By:
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Xxxxxxxxx X. Xxxx
Vice President
