Exhibit (d)(24)
INTERIM ADVISORY AGREEMENT
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INTERIM AGREEMENT entered into as of October 30, 2000 by and between NEW
ENGLAND ZENITH FUND, a Massachusetts business trust (the "Fund") with respect to
its CAPITAL GROWTH SERIES (the "Series"), and CAPITAL GROWTH MANAGEMENT LIMITED
PARTNERSHIP, a Massachusetts partnership (the "Adviser").
WITNESSETH:
WHEREAS, the Fund and the Adviser wish to enter into an interim agreement
setting forth the terms upon which the Adviser will perform certain services for
the Fund;
NOW THEREFORE, in consideration of the premises and covenants hereinafter
contained, the parties agree as follows:
1. The Fund hereby employs the Adviser to manage the investment and
reinvestment of the assets belonging to the Series and to perform the other
services herein set forth, subject to the supervision and control of the Board
of Trustees of the Fund. The Adviser hereby accepts such employment and agrees,
at its own expense, to render the services and to assume the obligations herein
set forth, for the compensation herein provided. The Adviser shall, unless
otherwise expressly provided or authorized, have no authority to act for or
represent the Fund in any way or otherwise be deemed an agent of the Fund.
2. In carrying out its obligations to manage the investment and
reinvestment of the assets belonging to the Series, the Adviser shall:
(a) obtain and evaluate such economic, statistical and financial data
and information and undertake such additional investment research as it
shall believe necessary or advisable for the management of the investment
and reinvestment of the assets belonging to the Series in accordance with
the Series' investment objective and policies;
(b) take such steps as are necessary to implement the investment
policies of the Series (and to ensure compliance by the Series with
applicable state insurance laws governing permissible investments) by
purchase and sale of securities, including the placing of orders for such
purchase and sale; and
(c) regularly report to the Board of Trustees with respect to the
implementation of the investment policies of the Series.
3. All activities in connection with the management of the affairs of the
Series undertaken by the Adviser pursuant to this Agreement shall at all times
be subject to the supervision and control of the Board of Trustees, any duly
constituted committee thereof or any officer of the Fund acting pursuant to like
authority.
4. In addition to performing at its expense the obligations set forth in
section 2 hereof, the Adviser shall furnish to the Fund at the Adviser's own
expense or pay the expenses of the Fund for the following:
(a) office space in such place or places as may be agreed upon from
time to time, and all necessary office supplies, facilities and equipment;
(b) necessary executive and other personnel for managing the affairs
of the Series, including personnel to perform clerical, bookkeeping,
accounting, stenographic and other office functions (exclusive of those
related to and to be performed under contract for custodial, transfer,
dividend and plan agency services by the bank selected to perform such
services);
(c) compensation, if any, of Trustees of the Fund who are directors,
officers, partners or employees of the Adviser or any affiliated person
(other than a registered investment company) of the Adviser; and
(d) all services, other than services of counsel, required in
connection with the preparation of registration statements and
prospectuses, including amendments and revisions thereto, all annual,
semiannual and periodic reports, and notices and proxy solicitation
material furnished to shareholders of the Fund or regulatory authorities,
to the extent that any such materials relate to the business of the Series,
to the shareholders thereof or otherwise to the Series, the Series to be
treated for these purposes as a separate legal entity and fund.
5. Nothing in section 4 hereof shall require the Adviser to bear, or to
reimburse the Fund for:
(a) any of the costs of printing and mailing the items referred to in
sub-section (d) of section 4;
(b) any of the costs of preparing, printing and distributing sales
literature;
(c) compensation of Trustees of the Fund who are not officers,
directors, partners or employees of the Adviser or of any affiliated person
(other than a registered investment company) of the Adviser;
(d) registration, filing and other fees in connection with
requirements of regulatory authorities;
(e) the charges and expenses of any Custodian appointed by the Fund
for custodial, paying agent, transfer agent and plan agent services;
(f) charges and expenses of independent accountants retained by the
Fund;
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(g) charges and expenses of any transfer agents and registrars
appointed by the Fund;
(h) brokers' commissions and issue and transfer taxes chargeable to
the Fund in connection with securities transactions to which the Fund is a
party;
(i) taxes and fees payable by the Fund to federal, state or other
governmental agencies;
(j) any cost of certificates representing shares of the Fund;
(k) legal fees and expenses in connection with the affairs of the
Fund including registering and qualifying its shares with federal and state
regulatory authorities;
(l) expenses of meetings of shareholders and Trustees of the Fund;
and
(m) interest, including interest on borrowings by the Fund.
6. (a) The services of the Adviser to the Fund hereunder are not to be
deemed exclusive and the Adviser shall be free to render similar services to
others, so long as its services hereunder are not impaired thereby.
(b) To better enable it to fulfill its obligations hereunder, the
Adviser has entered into a service agreement with New England Securities
Corporation under which the latter has agreed to furnish such office space for
the Fund and such clerical, bookkeeping, accounting, stenographic and
administrative personnel and services as the Adviser may reasonably request.
7. As full compensation for all services rendered, facilities furnished
and expenses borne by the Adviser hereunder, the Fund shall pay the Adviser
compensation at the annual rate of (a) .70% of the value of the net assets
belonging to the Series, as calculated below, up to $200 million, (b) .65% of
such value in excess of $200 million but less than or equal to $500 million, (c)
.60% of such value in excess of $500 million and (d) .55% of such value in
excess of $2 billion. Such compensation shall be payable monthly in arrears or
at such other intervals, not less frequently than quarterly, as the Board of
Trustees of the Fund may from time to time determine and specify in writing to
the Adviser. Such compensation shall be calculated on the basis of the average
of all the valuations of the net assets of the Series made as of the close of
business on each business day during the period for which such compensation is
paid. The Adviser hereby acknowledges that the Fund's obligation to pay such
compensation is binding only on the assets and property belonging to the Series.
Further:
(a) Such compensation shall be held in an interest-bearing escrow account
with State Street Bank and Trust Company;
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(b) If a majority of the outstanding voting securities of the Series
approve a new Advisory Agreement with the Adviser before 150 days after the
Effective Date (as defined in Section 10), the amount in the escrow account
(including interest earned thereon) with respect to such Series shall be paid to
the Adviser; and
(c) If a majority of the outstanding voting securities of the Series do not
approve a new Advisory Agreement with the Adviser, the Adviser shall be paid,
from the escrow account, the lesser of an amount equal to:
(1) any costs incurred in performing this Agreement (plus interest
earned on that amount in the escrow account) or
(2) the total amount in the escrow account (plus interest earned
thereon).
8. If the total of all ordinary business expenses of the Series or the
Fund as a whole (including investment advisory fees but excluding taxes,
portfolio brokerage commissions and interest) for any fiscal year exceeds the
lowest applicable percentage of average net assets or income limitation
prescribed by any state in which shares of the Series are qualified for sale,
the total fee otherwise due the Adviser for such fiscal year pursuant to Section
7 hereof shall be reduced by the amount of such excess belonging to the Series,
and, if, after giving effect to such reduction, the total of all such ordinary
expenses continues to exceed any such applicable limitation, the Adviser shall
pay any such continuing excess belonging to the Series; provided, however, that
the Adviser will not reduce its fees nor pay any such expenses to an extent or
under circumstances which would result in the inability of the Fund or the
Series (if it were treated as a separate entity under the Internal Revenue Code
of 1986, as amended) to qualify as a regulated investment company under the
Internal Revenue Code of 1986, as amended. Solely for purposes of applying such
limitations in accordance with the foregoing sentence, the Series and the Fund
shall each be deemed to be a separate fund subject to such limitations. Should
the applicable state limitation provisions fail to specify how the average net
assets of the Fund or belonging to the Series are to be calculated, that figure
shall be computed in the manner described in section 7 above.
9. It is understood that any of the shareholders, trustees, officers,
employees and agents of the Fund may be a partner, shareholder, director,
officer, employee or agent of, or be otherwise interested in the Adviser, any
affiliated person of the Adviser, any organization in which the Adviser may have
an interest or any organization which may have an interest in the Adviser; that
the Adviser, any such affiliated person or any such organization may have an
interest in the Fund; and that the existence of any such dual interest shall not
affect the validity hereof or of any transactions hereunder except as otherwise
provided in the Agreement and Declaration of Trust of the Fund and the
Partnership Agreement of the Adviser, respectively, or by specific provisions of
applicable law.
10. This Agreement shall become effective as of the date of its execution
(the "Effective Date") and will continue in effect until a new Advisory
Agreement between the Adviser and the Trust with respect to the Series is
approved by the shareholders of the Series or for 150 days, whichever is sooner.
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Additionally, this Agreement may be terminated at any time, without the
payment of any penalty,
a. by the Board of Trustees of the Trust or by the vote of a majority of
the outstanding voting securities of the Series, on ten days' written
notice to the Adviser,
b. by the Adviser on sixty days' written notice to the Trust; or
c. automatically in the event of its assignment.
In the event of termination of this Agreement, all compensation due to the
Adviser through the date of termination will be calculated on a pro rata basis
through the date of termination and paid on the first business day after the
next succeeding month end.
11. This Agreement may be amended at any time by mutual consent of the
parties, provided that such consent on the part of the Fund shall have been
approved by vote of a majority of the outstanding voting securities of the
Series and by vote of a majority of the Trustees of the Fund who are not
interested persons of the Fund or the Adviser, cast in person at a meeting
called for the purpose of voting on such approval.
12. For the purpose of this Agreement, the terms "vote of a majority of
the outstanding voting securities", "interested person", "affiliated person" and
"assignment" shall have their respective meanings defined in the Investment
Company Act of 1940, subject, however, to such exemptions as may be granted by
the Securities and Exchange Commission under said Act. References in this
Agreement to any assets, property or liabilities "belonging to" the Series shall
have the meaning defined in the Fund's Agreement and Declaration of Trust.
13. In the absence of willful misfeasance, bad faith or gross negligence
on the part of the Adviser, or reckless disregard of its obligations and duties
hereunder, the Adviser shall not be subject to any liability to the Fund, to any
shareholder of the Fund or to any other person, firm or organization, for any
act or omission in the course of, or connected with, rendering services
hereunder.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
day and year first above written.
NEW ENGLAND ZENITH FUND CAPITAL GROWTH MANAGEMENT
LIMITED PARTNERSHIP
By: Kenbob, Inc., as General Partner
By /s/ Xxxx X. Xxxxxxx By /s/ Xxxxxx X. Xxxx
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Xxxx X. Xxxxxxx Xxxxxx X. Xxxx
Senior Vice President President
A copy of the Agreement and Declaration of Trust establishing New England Zenith
Fund (the "Fund") is on file with the Secretary of State of The Commonwealth of
Massachusetts, and notice is hereby given that this Agreement is executed with
respect to the Fund's Capital Growth Series (the "Series") on behalf of the Fund
by officers of the Fund as officers and not individually and that the
obligations of or arising out of this Agreement are not binding upon any of the
Trustees, officers or shareholders individually but are binding only upon the
assets and property belonging to the Series.
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