Exhibit (d)(11)
MANAGEMENT CONTRACT
SALOMON BROTHERS SERIES FUNDS INC
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
October 15, 2001 as amended
through July 30, 2004
Salomon Brothers Asset Management Inc
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
This will confirm the agreement between the undersigned (the
"Company") and you (the "Investment Manager") as follows:
1. The Company is an open-end investment company which currently has
eleven investment portfolios - Salomon Brothers All Cap Value Fund, Salomon
Brothers Balanced Fund, Salomon Brothers Cash Management Fund, Salomon Brothers
High Yield Bond Fund, Salomon Brothers International Equity Fund, Salomon
Brothers Large Cap Growth Fund, Salomon Brothers New York Municipal Money Market
Fund, Salomon Brothers Institutional Money Market Fund, Salomon Brothers Small
Cap Growth Fund, Salomon Brothers Short/Intermediate U.S. Government Fund and
Salomon Brothers Strategic Bond Fund. The Company proposes to engage in the
business of investing and reinvesting the assets of Salomon Brothers All Cap
Value Fund ("All Cap Value Fund") (the "Fund") in the manner and in accordance
with the investment objective and limitations specified in the Company's
Articles of Incorporation, as amended (the "Articles") and the currently
effective prospectus, including the documents incorporated by reference therein
(the "Prospectus"), relating to the Company and the Fund, included in the
Company's Registration Statement, as amended from time to time (the
"Registration Statement"), filed by the Company under the Investment Company Act
of 1940, as amended (the "1940 Act"), and the Securities Act of 1933, as
amended. Copies of the documents referred to in the preceding sentence have been
furnished to the Investment Manager. Any amendments to these documents shall be
furnished to the Investment Manager.
2. The Company employs the Investment Manager to (a) make investment
strategy decisions for the Fund, (b) manage the investing and reinvesting of the
assets of the Fund as specified in paragraph 1, (c) place purchase and sale
orders on behalf of the Fund and (d) provide continuous supervision of the
investment portfolio of the Fund.
3. (a) The Investment Manager shall, at its expense, (i) provide the
Fund with office space, office facilities and personnel reasonably necessary for
performance of the services to be provided by the Investment Manager pursuant to
this Agreement, (ii) provide the Fund with persons satisfactory to the Company's
Board of Directors to serve as officers and employees of the Fund and (iii)
provide the office space, facilities, equipment and personnel necessary to
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perform the following services for the Fund: (A) Securities and Exchange
Commission ("SEC") compliance, including record keeping, reporting requirements
and registration statements and proxies; (B) supervision of the operations of
the Fund, including coordination of functions of administrator, transfer agent,
custodian, accountants, counsel and other parties performing services or
operational functions for the Fund; (C) certain administrative and clerical
services, including certain accounting services, facilitation of redemption
requests, exchange privileges, and account adjustments, development of new
shareholder services and maintenance of certain books and records; and (D)
certain services to the shareholders of the Fund, including assuring that
investments and redemptions are handled efficiently, responding to shareholder
inquiries and maintaining a flow of information to shareholders.
(b) Except as provided in subparagraph (a), the Company shall be
responsible for all of the Fund' expenses and liabilities, including
organizational expenses; taxes; interest; fees (including fees paid to its
directors who are not affiliated with the Investment Manager or any of its
affiliates); fees payable to the SEC; state securities qualification fees; costs
of preparing and printing prospectuses for regulatory purposes and for
distribution to existing shareholders; advisory and administration fees; charges
of the custodian and transfer agent; insurance premiums; auditing and legal
expenses; costs of shareholders' reports and shareholders' meetings; any
extraordinary expenses; and brokerage fees and commissions, if any, in
connection with the purchase or sale of portfolio securities; and payments to
the Fund's distributor for activities intended to result in the sale of Fund
shares.
4. As manager of the Fund's assets, the Investment Manager shall
make investments for the Fund's account in accordance with the investment
objective and limitations set forth in the Articles, the Prospectus, the 1940
Act, the provisions of the Internal Revenue Code of 1986, as amended, relating
to regulated investment companies, applicable banking laws and regulations, and
policy decisions adopted by the Company's Board of Directors from time to time.
The Investment Manager shall advise the Company's officers and Board of
Directors, at such times as the Company's Board of Directors may specify, of
investments made for the Fund's account and shall, when requested by the
Company's officers or Board of Directors, supply the reasons for making such
investments.
5. The Investment Manager is authorized on behalf of the Company,
from time to time when deemed to be in the best interests of the Company and to
the extent permitted by applicable law, to purchase and/or sell securities in
which the Investment Manager or any of its affiliates underwrites, deals in
and/or makes a market and/or may perform or seek to perform investment banking
services for issuers of such securities. The Investment Manager is further
authorized, to the extent permitted by applicable law, to select brokers for the
execution of trades for the Company, which broker may be an affiliate of the
Investment Manager, provided that the best competitive execution price is
obtained at the time of the trade execution.
6. In consideration of the Investment Manager's undertaking to
render the services described in this agreement, the Company agrees that the
Investment Manager shall not be liable under this agreement for any error of
judgment or mistake of law or for any loss suffered by the Company in connection
with the performance of this agreement, provided that nothing in this agreement
shall be deemed to protect or purport to protect the Investment Manager against
any liability to the Company or its stockholders to which the Investment Manager
would otherwise be subject by reason of willful misfeasance, bad faith or gross
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negligence in the performance of the Investment Manager's duties under this
agreement or by reason of the Investment Manager's reckless disregard of its
obligations and duties hereunder.
7. In consideration of the services to be rendered by the Investment
Manager under this agreement, the Company shall pay the Investment Manager a
monthly fee on the first business day of each month, based upon the average
daily value (as determined on the days and at the time set forth in the
Prospectus for determining net asset value per share) of the Fund's net assets
during the preceding month at the following annual rates:
Average Daily Net Assets Fee
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First $1.50 Billion 0.75%
Next $0.50 Billion 0.70%
Next $0.50 Billion 0.65%
Next $1.00 Billion 0.60%
Over $3.50 Billion 0.50%
If the fee payable to the Investment Manager pursuant to this
paragraph 7 begins to accrue before the end of any month or if this agreement
terminates before the end of any month, the fee for the period from such date to
the end of such month or from the beginning of such month to the date of
termination, as the case may be, shall be prorated according to the proportion
which such period bears to the full month in which such effectiveness or
termination occurs. For purposes of calculating each such monthly fee, the value
of the Fund's net assets shall be computed in the manner specified in the
Prospectus and the Articles for the computation of the value of the Fund's net
assets in connection with the determination of the net asset value of shares of
the Fund's capital stock.
8. If the aggregate expenses incurred by, or allocated to, the Fund
in any fiscal year shall exceed the expense limitations applicable to the Fund
imposed by state securities laws or regulations thereunder, as such limitations
may be raised or lowered from time to time, the Investment Manager shall
reimburse the Fund for such excess. The Investment Manager's reimbursement
obligation will be limited to the amount of fees it received under this
agreement during the period in which such expense limitations were exceeded,
unless otherwise required by applicable laws or regulations. With respect to
portions of a fiscal year in which this contract shall be in effect, the
foregoing limitations shall be prorated according to the proportion which that
portion of the fiscal year bears to the full fiscal year. Any payments required
to be made by this paragraph 8 shall be made once a year promptly after the end
of the Company's fiscal year.
9. This agreement shall continue in effect until two years from the
date hereof and thereafter for successive annual periods, provided that such
continuance is specifically approved at least annually (a) by the vote of a
majority of the outstanding voting securities (as defined in the 1940 Act) of
each of the Fund or by the Company's Board of Directors and (b) by the vote,
cast in person at a meeting called for the purpose, of a majority of the
Company's directors who are not parties to this agreement or "interested
persons" (as defined in the 1940 Act) of any such party. This agreement may be
terminated at any time, without the
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payment of any penalty, by a vote of a majority of the outstanding voting
securities (as defined in the 1940 Act) of each of the Fund or by a vote of a
majority of the Company's entire Board of Directors on 60 days' written notice
to the Investment Manager or by the Investment Manager on 60 days' written
notice to the Company. This agreement shall terminate automatically in the event
of its assignment (as defined in the 1940 Act).
10. Upon expiration or earlier termination of this agreement, the
Company shall, if reference to "Salomon Brothers" is made in the corporate name
of the Company or in the name of the Fund and if the Investment Manager requests
in writing, as promptly as practicable change its corporate name and the name of
the Fund so as to eliminate all reference to "Salomon Brothers", and thereafter
the Company and the Fund shall cease transacting business in any corporate name
using the words "Salomon Brothers" or any other reference to the Investment
Manager or "Salomon Brothers". The foregoing rights of the Investment Manager
and obligations of the Company shall not deprive the Investment Manager, or any
affiliate thereof which has "Salomon Brothers" in its name, of, but shall be in
addition to, any other rights or remedies to which the Investment Manager and
any such affiliate may be entitled in law or equity by reason of any breach of
this agreement by the Company, and the failure or omission of the Investment
Manager to request a change of the Company's or the Fund' name or a cessation of
the use of the name of "Salomon Brothers" as described in this paragraph 10
shall not under any circumstances be deemed a waiver of the right to require
such change or cessation at any time thereafter for the same or any subsequent
breach.
11. Except to the extent necessary to perform the Investment
Manager's obligations under this agreement, nothing herein shall be deemed to
limit or restrict the right of the Investment Manager, or any affiliate of the
Investment Manager, or any employee of the Investment Manager, to engage in any
other business or to devote time and attention to the management or other
aspects of any other business, whether of a similar or dissimilar nature, or to
render services of any kind to any other corporation, firm, individual or
association.
12. This agreement shall be governed by the laws of the State of New
York.
If the foregoing correctly sets forth the agreement between the
Company and the Investment Manager, please so indicate by signing and returning
to the Company the enclosed copy hereof.
Very truly yours,
SALOMON BROTHERS SERIES
FUNDS INC
By: /s/ X. Xxx Xxxxxx
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ACCEPTED:
SALOMON BROTHERS ASSET
MANAGEMENT INC
By: /s/ Xxxxx X. Xxxxx
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