COLONIAL TRUST IV
COLONIAL COUNSELOR SELECTsm INCOME PORTFOLIO
COLONIAL COUNSELOR SELECTsm BALANCED PORTFOLIO
COLONIAL COUNSELOR SELECTsm GROWTH PORTFOLIO
MANAGEMENT AGREEMENT
MANAGEMENT AGREEMENT ("Agreement"), made this 25th day of January,
1999, between COLONIAL TRUST IV, a business trust organized under the laws of
The Commonwealth of Massachusetts (the "Trust"), on its own behalf and on behalf
of each of Colonial Counselor Select Income Portfolio, Colonial Counselor Select
Balanced Portfolio, and Colonial Counselor Select Growth Portfolio
(collectively, the "Portfolios"), and Liberty Asset Management Company, a
corporation organized under the laws of the State of Delaware ("LAMCO").
WHEREAS, the Trust has been organized as an open-end management
investment company registered as such under the Investment Company Act of 1940,
as amended ("Investment Company Act"), and is authorized to issue shares of
beneficial interest in one or more separate series (each representing interests
in a separate portfolio of securities and other assets), including the
Portfolios;
WHEREAS, each of the Portfolios invests all or substantially all of its
assets in one or more other open-end mutual funds ("Underlying Liberty Funds")
as described in the Portfolios' prospectus as amended from time to time (the
"Prospectus");
WHEREAS, the Trust desires that LAMCO allocate each of the Portfolio's
assets among shares of one or more Underlying Liberty Funds in accordance with
its investment objective and policies as set forth in the Prospectus; and
WHEREAS, LAMCO is registered as an investment adviser under the
Investment Adviser's of 1940 (the "Investment Act Adviser's Act"), and desires
to provide services to the Trust and the Portfolios, in the manner contemplated
above, in consideration of and on the terms and conditions hereinafter set
forth;
NOW, THEREFORE, the Trust, on its own behalf and on behalf of each of
the Portfolios, and LAMCO hereby agree as follows:
1. Services to be provided by LAMCO.
A. Asset Allocation Services.
LAMCO will manage the investment of the assets of the
Portfolios in accordance with each Portfolio's prospectus and statement of
additional information, including allocating and reallocating from time to time,
in its sole discretion, the assets of each Portfolio among one or more
Underlying Liberty Funds as it deems appropriate giving consideration to such
Portfolio's investment objective, and shall render regular reports to the Board
of Trustees of the Trust relating to the performance of such duties.
B. Provision of Information Necessary for Preparation of
Registration Statement Amendments and Other Materials.
LAMCO will make available and provide such information
relating to itself and the Portfolios as the Trust may reasonably request for
use in the preparation of its Registration Statement, reports and other
documents required by federal laws and any securities and insurance laws of the
states and other jurisdictions in which shares of the Portfolios are sold.
C. Other Services.
LAMCO shall make its officers and employees available to the
Trustees and officers of the Trust for consulting and discussions regarding the
management of the Portfolios and their investment activities.
2. Expenses of the Trust.
It is understood that LAMCO shall not be obligated to bear any
expenses incidental to the operations and business of the Trust or its funds
(including the Portfolios), and that the Trust (or each of its funds (including
the Portfolios), where applicable) will pay, or will enter into arrangements
that require third parties to pay, all of the expenses of the Trust or such
funds, including without limitation:
A. Advisory, sub-advisory and administrative fees;
B. Fees for services of independent public accountants;
C. Legal and consulting fees;
D. Fees for transfer agent, custodian and portfolio
pricing, recordkeeping and tax information services;
E. Expenses of periodic calculations of the net asset
values of the funds of the Trust (including the
Portfolios) and of equipment for communication among
such funds' custodian, transfer agent and others;
F. Taxes and the preparation of the tax returns of the
funds of the Trust (including the Portfolios);
G. Brokerage fees and commissions;
H. Interest;
I. Costs of Board of Trustees and shareholder meetings;
J. Updates and printing of prospectuses, proxy statements
and reports to shareholders;
K. Fees for filing reports with regulatory bodies and the
maintenance of the Trust's existence;
L. Membership dues for industry trade associations;
M. Fees to federal authorities for the registration of the
shares of the funds of the Trust (including the
Portfolios);
N. Fees and expenses of Trustees who are not directors,
officers, employees or stockholders of LAMCO or any of
its affiliates;
O. Distribution fees pursuant to Rule 12b-1;
P. Insurance and fidelity bond premiums; and
Q. Litigation and other extraordinary expenses of a
non-recurring nature.
3. Activities and Affiliates of the Manager.
A. The Trust acknowledges that LAMCO or one or more of its
affiliates may have investment or administrative responsibilities or render
investment advice to or perform other investment advisory services for other
individuals or entities, and that LAMCO, its affiliates or any of its or their
directors, officers, agents or employees may buy, sell or trade in securities
for its or their respective accounts ("Affiliated Accounts"). The Trust agrees
that LAMCO or its affiliates may give advice or exercise investment
responsibility and take such other action with respect to Affiliated Accounts
which may differ from the advice given or the timing or nature of action with
respect to the Portfolios, provided that it acts in good faith. The Trust
acknowledges that one or more of the Affiliated Accounts may at any time hold,
acquire, increase, decrease, dispose of or otherwise deal with positions in
investments in which the Portfolios may have an interest.
B. Subject to and in accordance with the Declaration of Trust
and By-Laws of the Trust as currently in effect and the Investment Company Act
and the rules thereunder, it is understood that Trustees, officers and agents of
the Trust and shareholders of the Trust are or may be interested persons as
defined by the Investment Company Act of LAMCO or of its affiliates as
directors, officers, agents and shareholders thereof; that directors, officers,
agents and shareholders of LAMCO or of its affiliates are or may be interested
persons of the Trust as Trustees, officers, agents, shareholders or otherwise;
LAMCO its affiliates may be interested persons of the Trust as shareholders or
otherwise; and that the effect of any such interests shall be governed by said
Declaration of Trust and By-Laws and the Investment Company Act and the rules
thereunder.
4. Compensation of LAMCO.
For all services to be rendered by LAMCO pursuant to this Agreement,
(a) the Trust, on its own behalf and on behalf of each Portfolio, will pay LAMCO
monthly in arrears a fee at an annual rate equal to 0.01% of the net asset value
of such Portfolio. Such fee shall be accrued for each calendar day and the sum
of the daily fee accruals shall be paid monthly on or before the tenth day of
the following calendar month. The daily accruals of the fee will be computed by
(i) multiplying the annual percentage rate referred to above by the fraction the
numerator of which is one and the denominator of which is the number of calendar
days in the year, and (ii) multiplying the product obtained pursuant to clause
(i) above by the net asset value of each Portfolio as determined in accordance
with the Prospectus as of the previous business day on which such Portfolio was
open for business. The foregoing fee shall be prorated for any month during
which this Agreement is in effect for only a portion of the month.
5. Liabilities of LAMCO.
A. Except as provided below, in the absence of willful
misfeasance, bad faith, gross negligence, or reckless disregard of obligations
or duties hereunder on the part of LAMCO, LAMCO shall not be subject to
liability to the Trust or to any shareholder of the Trust for any act or
omission in the course of, or connected with, rendering services hereunder or
for any losses that may be sustained in the purchase, holding or sale of any
security.
B. No provision of this Agreement shall be construed to
protect any Trustee or officer of the Trust, or LAMCO, as the case may be, from
liability in violation of Sections 17(h) and (i) of the Investment Company Act.
6. Effective Date: Term.
This Agreement shall become effective on the date hereof and shall
continue until July 1, 2000, and from year to year thereafter, but only so long
as such continuance is specifically approved at least annually by a vote of the
Trustees, including the vote of a majority of the Trustees who are not
interested persons of the Trust, cast in person at a meeting called for the
purpose of voting on such approval, or by vote of a majority of the outstanding
voting securities. The aforesaid provision shall be construed in a manner
consistent with the Investment Company Act and the rules and regulations
thereunder.
7. Assignment.
No assignment of this Agreement shall be made by LAMCO, and this
Agreement shall terminate automatically in the event of any such assignment.
LAMCO shall notify the Trust in writing in advance of any proposed change of
control with respect to it to enable the Trust to take the steps necessary to
enter into a new advisory contract.
8. Amendment
This Agreement may be amended at any time, but only by written
agreement between LAMCO and the Trust, which is subject to the approval of the
Trustees of the Trust and the shareholders of any affected Portfolio in the
manner required by the Investment Company Act and the rules thereunder.
9. Termination.
This Agreement:
(a) may at any time be terminated without payment of any
penalty, by the Trust (by the Board of Trustees of the
Trust or by the vote of a majority of the outstanding
voting securities of the Portfolio) on sixty (60) days'
written notice to LAMCO;
(b) shall immediately terminate in the event of its
assignment; and
(c) may be terminated by LAMCO on sixty (60) days written
notice to the other parties hereto.
10. Definitions.
As used in this Agreement, the terms "affiliated person," "assignment,"
"control," "interested person" and "vote of a majority of the outstanding voting
securities" shall have the meanings set forth in the Investment Company Act and
the rules and regulations thereunder, subject to any applicable orders of
exemption issued by the Securities and Exchange Commission.
11. Notice.
Any notice under this Agreement shall be given in writing addressed and
delivered or mailed postpaid to the other party to this Agreement at its
principal place of business.
12. Severability.
If any provision of this Agreement shall be held or made invalid by a
court decision, statute, rule or otherwise, the remainder of this Agreement
shall not be affected thereby.
13. Shareholder Liability.
LAMCO is hereby expressly put on notice of the limitation of
shareholder liability as set forth in the Declaration of Trust of the Trust and
agrees that obligations assumed by the Trust pursuant to this Agreement shall be
limited in all cases to the Trust and its assets, and if the liability relates
to one or more Portfolios, the obligations thereunder shall be limited to the
respective assets of such Portfolios. LAMCO further agrees that it shall not
seek satisfaction of any such obligation from the shareholders of the
Portfolios, nor from the Trustees or any individual Trustee of the Trust.
14. Governing Law.
This Agreement shall be interpreted under, and the performance of LAMCO
under this Agreement shall be consistent with, the provisions of the Agreement
and Declaration of Trust and By-Laws of the Trust, the terms of the Investment
Company Act, applicable rules and regulations thereunder, the Code and
regulations thereunder, and the Trust's Prospectus and Statement of Additional
Information in so far as they relate to the Portfolios, in each case as from
time to time in effect. The provisions of this Agreement shall be construed and
interpreted in accordance with the domestic substantive laws of The Commonwealth
of Massachusetts without giving effect to any choice or conflict of laws rules
or provisions that would result in the application of the domestic substantive
laws of any other jurisdiction; provided, however, that if such law or any of
the provisions of this Agreement conflict with the applicable provisions of the
Investment Company Act, the latter shall control.
This Agreement may be executed in any number of counterparts, each of
which shall be deemed an original.
IN WITNESS WHEREOF, the parties hereto have duly executed this
agreement on the date first above written.
COLONIAL TRUST IV,
on its own behalf and on behalf of each of
Colonial Counselor Select Income
Portfolio, Colonial Counselor Select
Balanced Portfolio, and Colonial
Counselor Select Growth Portfolio
By: Xxxxx X. Xxxxxx
Title: Secretary
LIBERTY ASSET MANAGEMENT COMPANY
By: Xxxxxxx X. Xxxxxxxxxx
Title:
