Exhibit (d)(vii)
ASSUMPTION AGREEMENT
This assumption agreement (the "Agreement") is made as of this 2nd day of
May, 2001 by and between Bessemer Investment Management LLC, a Delaware limited
liability company ("Bessemer Investment Management"), Bessemer Trust Company,
N.A., a national banking association, ("Bessemer Trust") and Old Westbury Funds,
Inc., a Maryland corporation registered as an investment company under the
Investment Company Act of 1940, as amended ("Old Westbury Funds").
WHEREAS, Bessemer Trust and Old Westbury Funds, on behalf of its portfolios
listed in Appendix A, are parties to Advisory Contracts attached hereto as
Exhibit A (each an "Advisory Contract"); and
WHEREAS, Bessemer Investment Management wishes to assume Bessemer Trust's
duties and obligations under the Advisory Contracts.
NOW, THEREFORE, based on the foregoing, the parties agree as follows:
1. Assumption. Bessemer Investment Management, intending to be
----------
legally bound, hereby agrees to assume and perform all duties and
obligations of Bessemer Trust under the Advisory Contracts.
2. Release. Old Westbury Funds hereby releases Bessemer Trust from
-------
its rights and obligations under the Advisory Contracts and
terminates the Investment Advisory relationship between Bessemer
Trust and Old Westbury Funds, both as of the date hereof.
3. Indemnity. Bessemer Trust Company, N.A. agrees to indemnify,
---------
defend and hold harmless the Old Westbury Funds from and against
any and all loss, cost, damage or expense (including reasonable
fees of counsel) whatsoever resulting from or arising out of the
Advisory Contracts hereby assumed by Bessemer Investment
Management or any obligation assumed by Bessemer Investment
Management thereunder.
Bessemer Trust hereby waives any requirement that Old Westbury
Funds exhaust any right or remedy or proceed or take any action
against Bessemer Investment Management or any other person or
entity before exercising any right or remedy against Bessemer
Trust under this Agreement.
The obligations of Bessemer Trust hereunder are absolute and
unconditional. Bessemer Trust's indemnity shall be a continuing
indemnity and shall continue in full force and effect until all
of the obligations hereby assumed by Bessemer Investment
Management shall have been satisfied in full.
IN WITNESS WHEREOF, Bessemer Investment Management, Bessemer Trust and Old
Westbury Funds hereby execute this Agreement as of the day and year first above
written.
BESSEMER INVESTMENT MANAGEMENT LLC
By:
--------------------------------
Name:
Title: President
BESSEMER TRUST COMPANY, N.A.
By:
--------------------------------
Name:
Title:
OLD WESTBURY FUNDS, INC.
By:
--------------------------------
Name: Xxxxxx X. Xxxxx
Title: President
Appendix A
------------------------------------------------------- -------------------------------------------------------------
Portfolio Date of Advisory Contract with Bessemer
Trust Company
------------------------------------------------------- -------------------------------------------------------------
Old Westbury International Fund October 12, 1993
------------------------------------------------------- -------------------------------------------------------------
Old Westbury Capital Opportunity Fund August 8, 1996 as amended and restated on
February 28, 2001
------------------------------------------------------- -------------------------------------------------------------
Old Westbury Core Equities Fund November 13, 1997
------------------------------------------------------- -------------------------------------------------------------
Old Westbury Fixed Income Fund November 13, 1997
------------------------------------------------------- -------------------------------------------------------------
Old Westbury Municipal Bond Fund November 13, 1997
------------------------------------------------------- -------------------------------------------------------------
ADVISORY CONTRACT
OLD WESTBURY FUNDS, INC. (the "Fund")
Old Westbury Core Equities Fund (the "Portfolio")
Federated Investors Funds
0000 Xxxxxxxxx Xxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000-0000
November 13, 1997
Bessemer Trust Company, N.A.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Gentlemen:
We herewith confirm our agreement with you as follows:
1. We propose to engage in the business of investing and reinvesting our
assets in securities of the type, and in accordance with the limitations,
specified in our Articles of Incorporation, By-Laws and Registration Statement
filed with the Securities and Exchange Commission under the Investment Company
Act of 1940 (the "1940 Act') and the Securities Act of 1933, including the
Prospectus forming a part thereof (the "Registration Statement"), all as from
time to time in effect, and in such manner and to such extent as may from time
to time be authorized by our Board of Directors. We enclose copies of the
documents listed above and will furnish you such amendments thereto as may be
made from time to time.
-1-
2. (a) We hereby employ you to manage the investment and reinvestment of
our assets as above specified, and, without limiting the generality of the
foregoing, to provide the management and other services specified below.
(b) Subject to the general control of our Board of Directors, you
will make decisions with respect to all purchases and sales of our portfolio
securities. To carry out such decisions, you are hereby authorized, as our agent
and attorney-in-fact, for our account and at our risk and in our name, to place
orders for the investment and reinvestment of our assets. In all purchases,
sales and other transactions in our portfolio securities you are authorized to
exercise full discretion and act for us in the same manner and with the same
force and effect as our corporation itself might or could do with respect to
such purchases, sales or other transactions, as well as with respect to all
other things necessary or incidental to the furtherance or conduct of such
purchases, sales or other transactions. In furtherance of such and subject to
applicable law and procedures adopted by the Fund's Board of Directors, you may
(i) pay commissions to brokers other than yourself which are higher than such
that might be charged by another qualified broker to obtain brokerage and/or
research services considered by you to be useful or desirable for your
investment management of the Portfolio and/or other advisory accounts of yours
and any investment advisor affiliated with you: and (ii) consider the sales of
shares of the Portfolio by brokers including your affiliates as a factor in your
selection of brokers for Portfolio transactions.
(c) You will report to our Board of Directors at each meeting
thereof all changes in our portfolio since your prior report, and will also keep
us in touch with important developments affecting our portfolio and, on your own
initiative, will furnish us from time to time with such information as you may
believe appropriate for this purpose, whether concerning the individual entities
whose securities are included in our portfolio, the activities in which such
entities engage, Federal income tax policies applicable to our investments, or
the conditions prevailing in the money market or the economy generally. You will
also furnish us with such statistical and analytical information with respect to
our portfolio securities as you may believe appropriate or as we may reasonably
request. In making such purchases and sales of our portfolio securities, you
will comply with the policies set from time to time by our Board of Directors as
well as the limitations imposed by our Amended Articles of Incorporation, the
provisions of the Internal Revenue Code relating to regulated investment
companies and the 1940 Act, and the limitations contained in the Registration
Statement.
(d) It is understood that you will from time to time employ,
subcontract with or otherwise associate yourself with, entirely at your expense
such persons as you believe to be particularly fitted to assist you in the
execution of your duties hereunder.
(e) You or your affiliates will also provide supervisory personnel
who will be responsible for supervising and monitoring the performance of our
Administrator in connection with its duties under our Administrative Services
Agreement and for supervising the performance of other administrative services,
accounting and related services, net asset value and yield calculations, reports
to and filings with regulatory authorities, and services relating to such
functions. Such personnel may be your employees or employees of your affiliates
or of other organizations. It is understood that we have retained, at our
expense, an Administrator to perform the operational components of the functions
and services listed herein.
(f) You or your affiliates will also furnish us such additional
administrative supervision and such office facilities as you may believe
-2-
appropriate or as we may reasonably request subject to the requirements of any
regulatory authority to which you may be subject. We will reimburse you for all
of our operating costs incurred by you, including rent, depreciation of
equipment and facilities, interest and amortization of loans financing equipment
used by us and all the expenses incurred to conduct our affairs. The amounts of
such reimbursements shall from time to time be agreed upon between us.
3. We agree, subject to the limitations described below, to be responsible
for, and hereby assume the obligation for payment of, all our expenses
including: (a) brokerage and commission expenses; (b) foreign, federal, state or
local taxes, including issuance and transfer taxes incurred by or levied on us;
(c) commitment fees, certain insurance premiums and membership fees and dues in
investment company organizations; (d) interest charges on borrowings; (e)
charges and expenses of our custodian; (f) charges and expenses relating to the
issuance, redemption, transfer and dividend disbursing functions for us; (g)
telecommunications expenses; (h) recurring and non-recurring legal, accounting
and recordkeeping expenses; (i) costs of organizing and maintaining the Fund's
existence as a corporation; (j) compensation, including directors' fees, of any
of our directors, officers or employees who are not your officers or officers
employees of the Administrator or their affiliates, and costs of other personnel
providing administrative and clerical service to us; (k) costs of providing
shareholders' services, including charges and expenses of persons providing
confirmations of transactions in the Portfolio's shares, periodic statements to
shareholders and recordkeeping services, and costs of shareholders' reports,
proxy solicitations, and corporate meetings; (l) fees and expenses of
registering our shares under the appropriate federal securities laws and of
qualifying our shares under applicable state securities laws, including expenses
attendant upon the initial registration and qualification of these shares and
attendant upon renewals of, or amendment to, those registrations and
qualifications; (m) expenses of preparing, printing and delivering the initial
registration statement and of preparing, printing and delivering the Prospectus
to existing shareholders and of printing shareholder application forms for
shareholder accounts; (n) fees and expenses payable to the Advisor, Distributor,
Administrator, custodian, transfer agent and dividend agent; and (o) any other
distribution or promotional expenses contemplated by an effective plan adopted
by us pursuant to Rule 12b-1 under the Act. Our obligation for the foregoing
expenses is limited by your agreement to be responsible, while this Agreement is
in effect, for any amount by which our annual operating expenses, including
distribution expenses, (excluding taxes, brokerage, interest and extraordinary
expenses) exceed the limits on investment company expenses prescribed by any
state in which the Portfolio's shares are qualified for sale.
4. We will expect of you, and you will give us the benefit of, your best
judgment and efforts in rendering these services to us, and we agree as an
inducement to your undertaking these services that you will not be liable
hereunder for any mistake of judgment or for any other cause, provided that
nothing herein shall protect you against any liability to us or to our security
holders by reason of willful misfeasance, bad faith or gross negligence in the
performance of your duties hereunder, or by reason of your reckless disregard of
your obligations and duties hereunder.
5. (a) In consideration of the foregoing we will pay you a fee computed
daily and payable monthly, in accordance with the following schedule: .70% of
the first $100 million of the Portfolio's average net assets; .65% of the second
$100 million of the Portfolio's average net assets; and .60% of the Portfolio's
average net assets exceeding $200 million. Your fee will be accrued by us daily,
and will be payable on the last day of each calendar month for services
performed hereunder during that month or on such other schedule as you shall
request of us in writing. You may waive your right to any fee to which you are
-3-
entitled hereunder, provided such waiver is delivered to us in writing. Any
reimbursement of our expenses, to which we may become entitled pursuant to
paragraph 3 hereof, will be paid to us at the end of the month for which those
expenses are accrued, at the same time as we pay your fee.
(b) Pursuant to the Portfolio's Distribution and Service Plan, the
Advisor will also act as a shareholder servicing agent for the Portfolio
pursuant to which the Portfolio is permitted to pay the Advisor a maximum of
.25% per annum of the Portfolio's average daily net assets to compensate it and
to permit the Advisor to compensate banks, savings and loans and other financial
institutions (the Advisor with such other institutions, each a "Shareholder
Servicing Agent") whose clients are Portfolio shareholders for providing
shareholder services. In addition, the Advisor may use the advisory fee for
distribution and servicing functions on behalf of the Portfolio, compensating
others, including banks, broker-dealers and other organizations whose customers
or clients are shareholders of the Portfolio for providing assistance in
distributing the Portfolio's shares and defraying the cost of shareholder
servicing and other promotional activities. To the extent that you or your
affiliates directly may make payments to banks, securities dealers and other
third parties who engage in the sale of our shares or who render shareholder
support services, and that such payments may be deemed indirect financing of an
activity primarily intended to result in the sale of shares of the Portfolio
within the context of Rule 12b-1 under the 1940 Act (the "Rule"), then such
payments by you shall be deemed to be authorized under the Portfolio's
Distribution and Service Plan adopted pursuant to the Rule. You, will, in your
sole discretion, determine the amount of such payments and may from time to time
in your sole discretion increase or decrease the amount the Portfolio is
required to pay you or any person under this Agreement or any agreement. Any
payments made by you for such purposes are subject to compliance with the terms
of written agreements in a form satisfactory to the Fund's Board of Directors to
be entered into by you and the participating organization.
6. This Agreement will become effective on November 13, 1997 and shall
continue in effect until November 13, 1999 and thereafter for successive twelve-
month periods (computed from each November 1), provided that such continuation
is specifically approved at least annually by our Board of Directors or by a
majority vote of the holders of our outstanding voting securities, as defined in
the 1940 Act, and, in either case, by a majority of those of our directors who
are neither party to this Agreement nor, other than by their service as
directors of the corporation, interested persons, as defined in the 1940 Act, of
any such person who is party to this Agreement. Upon effectiveness of this
Agreement, it shall supersede all previous Agreements between us covering the
subject matter hereof. This Agreement may be terminated at any time, without the
payment of any penalty, by vote of a majority of our outstanding voting
securities as defined in the 1940 Act, or by a vote of majority of our entire
Board of Directors, on sixty days' written notice to you, or by you on sixty
days' written notice to us.
7. This Agreement may not be transferred, assigned, sold or in any manner
hypothecated or pledged by you and this Agreement shall terminate automatically
in the event of any such transfer, assignment, sale, hypothecation or pledge by
you. The terms "transfer", "assignment" and "sale" as used in this paragraph
shall have the meanings ascribed thereto by governing law and in applicable
rules or regulations of the Securities and Exchange Commission.
8. Except to the extent necessary to perform your obligations hereunder,
nothing herein shall be deemed to limit or restrict your right, or the right of
any of your officers, directors or employees who may also be a director, officer
or employee of ours, or a person affiliated with us, as defined in the Act, to
-4-
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.
If the foregoing is in accordance with your understanding, you will kindly
so indicate by signing and returning to us the enclosed copy hereof.
Very truly yours,
OLD WESTBURY FUNDS, INC.
Old Westbury Core Equities Fund
By: /s/ C. Xxxxxxxxx Xxxxxxx
Name: C. Xxxxxxxxx Xxxxxxx
Title: Vice President
ACCEPTED: November 13, 1997
BESSEMER TRUST COMPANY, N.A.
By: /s/ Xxxxxx X. Xxxxxxx
Name: Xxxxxx X. Xxxxxxx
Title: Senior Executive Vice President
-5-
ADVISORY CONTRACT
OLD WESTBURY FUNDS, INC. (the "Fund")
Old Westbury Capital Opportunity Fund (the "Portfolio")
August 8, 1996
as amended and restated on February 28, 2001
Bessemer Trust Company, N.A.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Gentlemen:
We herewith confirm our agreement with you as follows:
1. We propose to engage in the business of investing and reinvesting
our assets in securities of the type, and in accordance with the limitations,
specified in our Articles of Incorporation, By-Laws and Registration Statement
filed with the Securities and Exchange Commission under the Investment Company
Act of 1940 (the "1940 Act") and the Securities Act of 1933, including the
Prospectus forming a part thereof (the "Registration Statement"), all as from
time to time in effect, and in such manner and to such extent as may from time
to time be authorized by our Board of Directors. We enclose copies of the
documents listed above and will furnish you such amendments thereto as may be
made from time to time.
2. (a) We hereby employ you to manage the investment and
reinvestment of our assets as above specified, and, without limiting the
generality of the foregoing, to provide the management and other services
specified below.
(b) Subject to the general control of our Board of Directors,
you will make decisions with respect to all purchases and sales of our portfolio
securities. To carry out such decisions, you are hereby authorized, as our agent
and attorney-in-fact, for our account and at our risk and in our name, to place
orders for the investment and reinvestment of our assets. In all purchases,
sales and other transactions in our portfolio securities you are authorized to
exercise full discretion and act for us in the same manner and with the same
force and effect as our corporation itself might or could do with respect to
such purchases, sales or other transactions, as well as with respect to all
other things necessary or incidental to the furtherance or conduct of such
purchases, sales or other transactions. In furtherance of such and subject to
applicable law and procedures adopted by the Fund's Board of Directors, you may
(i) pay commissions to brokers other than yourself which are
-1-
higher than such that might be charged by another qualified broker to obtain
brokerage and/or research services considered by you to be useful or desirable
for your investment management of the Portfolio and/or other advisory accounts
of yours and any investment advisor affiliated with you; and (ii) consider the
sales of shares of the Portfolio by brokers including your affiliates as a
factor in your selection of brokers for Portfolio transactions.
(c) You will report to our Board of Directors at each meeting
thereof all changes in our portfolio since your prior report, and will also keep
us in touch with important developments affecting our portfolio and, on your own
initiative, will furnish us from time to time with such information as you may
believe appropriate for this purpose, whether concerning the individual entities
whose securities are included in our portfolio, the activities in which such
entities engage, Federal income tax policies applicable to our investments, or
the conditions prevailing in the money market or the economy generally. You will
also furnish us with such statistical and analytical information with respect to
our portfolio securities as you may believe appropriate or as we may reasonably
request. In making such purchases and sales of our portfolio securities, you
will comply with the policies set from time to time by our Board of Directors as
well as the limitations imposed by our Amended Articles of Incorporation, the
provisions of the Internal Revenue Code relating to regulated investment
companies and the 1940 Act, and the limitations contained in the Registration
Statement.
(d) It is understood that you will from time to time employ,
subcontract with or otherwise associate yourself with, entirely at your expense
such persons as you believe to be particularly fitted to assist you in the
execution of your duties hereunder.
(e) You or your affiliates will also provide supervisory
personnel who will be responsible for supervising and monitoring the performance
of our Administrator in connection with its duties under our Administrative
Services Agreement and for supervising the performance of other administrative
services, accounting and related services, net asset value and yield
calculations, reports to and filings with regulatory authorities, and services
relating to such functions. Such personnel may be your employees or employees of
your affiliates or of other organizations. It is understood that we have
retained, at our expense, an Administrator to perform the operational components
of the functions and services listed herein.
(f) You or your affiliates will also furnish us such additional
administrative supervision and such office facilities as you may believe
appropriate or as we may reasonably
-2-
request subject to the requirements of any regulatory authority to which you may
be subject. We will reimburse you for all of our operating costs incurred by
you, including rent, depreciation of equipment and facilities, interest and
amortization of loans financing equipment used by us and all the expenses
incurred to conduct our affairs. The amounts of such reimbursements shall from
time to time be agreed upon between us.
3. We agree, subject to the limitations described below, to be
responsible for, and hereby assume the obligation for payment of, all our
expenses including: (a) brokerage and commission expenses; (b) foreign, federal,
state or local taxes, including issuance and transfer taxes incurred by or
levied on us; (c) commitment fees, certain insurance premiums and membership
fees and dues in investment company organizations; (d) interest charges on
borrowings; (e) charges and expenses of our custodian; (f) charges and expenses
relating to the issuance, redemption, transfer and dividend disbursing functions
for us; (g) telecommunications expenses; (h) recurring and non-recurring legal,
accounting and recordkeeping expenses; (i) costs of organizing and maintaining
the Fund's existence as a corporation; (j) compensation, including directors'
fees, of any of our directors, officers or employees who are not your officers
or officers or employees of the Administrator or its affiliates, and costs of
other personnel providing administrative and clerical services to us; (k) costs
of providing shareholders' services, including charges and expenses of persons
providing confirmations of transactions in the Portfolio's shares, periodic
statements to shareholders and recordkeeping services, and costs of
shareholders' reports, proxy solicitations, and corporate meetings; (1) fees and
expenses of registering our shares under the appropriate federal securities laws
and of qualifying our shares under applicable state securities laws, including
expenses attendant upon the initial registration and qualification of these
shares and attendant upon renewals of, or amendment to, those registrations and
qualifications; (m) expenses of preparing, printing and delivering the initial
registration statement and of preparing, printing and delivering the Prospectus
to existing shareholders and of printing shareholder application forms for
shareholder accounts; (n) fees and expenses payable to the Advisor, Distributor,
Administrator, custodian, transfer agent and dividend agent; and (o) any other
distribution or promotional expenses contemplated by an effective plan adopted
by us pursuant to Rule 12b-1 under the Act. Our obligation for the foregoing
expenses is limited by your agreement to be responsible, while this Agreement is
in effect, for any amount by which our annual operating expenses, including
distribution expenses, (excluding taxes, brokerage, interest and extraordinary
expenses) exceed the limits on investment company expenses prescribed by any
state in which the Portfolio's shares are qualified for sale.
-3-
4. We will expect of you, and you will give us the benefit of, your
best judgment and efforts in rendering these services to us, and we agree as an
inducement to your undertaking these services that you will not be liable
hereunder for any mistake of judgment or for any other cause, provided that
nothing herein shall protect you against any liability to us or to our security
holders by reason of willful misfeasance, bad faith or gross negligence in the
performance of your duties hereunder, or by reason of your reckless disregard of
your obligations and duties hereunder.
5. (a) In consideration of the foregoing we will pay you a fee
computed daily and payable monthly, in accordance with the following schedule:
.70% of the first $100 million of the Portfolio's average net assets; .65% of
the second $100 million of the Portfolio's average net assets; and .60% of the
Portfolio's average net assets exceeding $200 million. Your fee will be accrued
by us daily, and will be payable on the last day of each calendar month for
services performed hereunder during that month or on such other schedule as you
shall request of us in writing. You may waive your right to any fee to which
you are entitled hereunder, provided such waiver is delivered to us in writing.
Any reimbursement of our expenses, to which we may become entitled pursuant to
paragraph 3 hereof, will be paid to us at the end of the month for which those
expenses are accrued, at the same time as we pay you your fee.
(b) Pursuant to the Portfolio's Distribution and Service Plan,
the Advisor will also act as a shareholder servicing agent for the Portfolio
pursuant to which the Portfolio is permitted to pay the Advisor a maximum of
.25% per annum of the Portfolio's average daily net assets to compensate it and
to permit the Advisor to compensate banks, savings and loans and other financial
institutions (the Advisor with such other institutions, each a "Shareholder
Servicing Agent") whose clients are Portfolio shareholders for providing
shareholder services. In addition, the Advisor may use the advisory fee for
distribution and servicing purposes including defraying the costs of performing
shareholder servicing functions on behalf of the Portfolio, compensating others,
including banks, broker-dealers and other organizations whose customers or
clients are shareholders of the Portfolio for providing assistance in
distributing the Portfolio's shares and defraying the cost of shareholder
servicing and other promotional activities. To the extent that you or your
affiliates directly may make payments to banks, securities dealers and other
third parties who engage in the sale of our shares or who render shareholder
support services, and that such payments may be deemed indirect financing of an
activity primarily intended to result in the sale of shares of the Portfolio
within the context of Rule 12b-1 under the 1940 Act (the "Rule"), then such
payments by you shall be deemed to be authorized under the Portfolio's
Distribution and Service Plan
-4-
adopted pursuant to the Rule. You, will, in your sole discretion, determine the
amount of such payments and may from time to time in your sole discretion
increase or decrease the amount of such payments; provided, however, that no
such payment will increase the amount the Portfolio is required to pay you or
any person under this Agreement or any agreement. Any payments made by you for
such purposes are subject to compliance with the terms of written agreements in
a form satisfactory to the Fund's Board of Directors to be entered into by you
and the participating organization.
6. This Agreement will become effective on August 8, 1996 and shall
continue in effect until August 8, 1998 and thereafter for successive twelve-
month periods (computed from each August 1), provided that such continuation is
specifically approved at least annually by our Board of Directors or by a
majority vote of the holders of our outstanding voting securities, as defined in
the 1940 Act, and, in either case, by a majority of those of our directors who
are neither party to this Agreement nor, other than by their service as
directors of the corporation, interested persons, as defined in the 1940 Act, of
any such person who is party to this Agreement. Upon the effectiveness of this
Agreement, it shall supersede all previous Agreements between us covering the
subject matter hereof. This Agreement may be terminated at any time, without
the payment of any penalty, by vote of a majority of our outstanding voting
securities, as defined in the 1940 Act, or by a vote of a majority of our entire
Board of Directors, on sixty days' written notice to you, or by you on sixty
days' written notice to us.
7. This Agreement may not be transferred, assigned, sold or in any
manner hypothecated or pledged by you and this Agreement shall terminate
automatically in the event of any-such transfer, assignment, sale, hypothecation
or pledge by you. The terms "transfer", "assignment" and "sale" as used in this
paragraph shall have the meanings ascribed thereto by governing law and in
applicable rules or regulations of the Securities and Exchange Commission.
8. Except to the extent necessary to perform your obligations
hereunder, nothing herein shall be deemed to limit or restrict your right, or
the right of any of your officers, directors or employees who may also be a
director, officer or employee of ours, or of a person affiliated with us, as
defined in the Act, 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.
-5-
If the foregoing is in accordance with your understanding, will you
kindly so indicate by signing and returning to us the enclosed copy hereof.
Very truly yours,
OLD WESTBURY FUNDS, INC.
Old Westbury Capital Opportunity Fund
By: __________________________________
Name: Xxxxxx X. Xxxxx
Title: President
ACCEPTED: February 28, 2001
BESSEMER TRUST COMPANY, N.A.
By: ______________________
Name: Xxxxxx X. Xxxxxxx
Title: Senior Executive Vice President
-6-
ADVISORY CONTRACT
OLD WESTBURY FUNDS, INC. (the "Fund")
Old Westbury International Fund (the "Portfolio")
0 Xx. Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
October 12, 1993
Bessemer Trust Company, N.A.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Gentlemen:
We herewith confirm our agreement with you as follows:
1. We propose to engage in the business of investing and
reinvesting our assets in securities of the type, and in accordance with the
limitations, specified in our Articles of Incorporation, By-Laws and
Registration Statement filed with the Securities and Exchange Commission under
the Investment Company Act of 1940 (the "1940 Act") and the Securities Act of
1933, including the Prospectus forming a part thereof (the "Registration
Statement"), all as from time to time in effect, and in such manner and to such
extent as may from time to time be authorized by our Board of Directors. We
enclose copies of the documents listed above and will furnish you such
amendments thereto as may be made from time to time.
2. (a) We hereby employ you to manage the investment and
reinvestment of our assets as above specified, and, without limiting the
generality of the foregoing, to provide the management and other services
specified below.
(b) Subject to the general control of our Board of Directors,
you will make decisions with respect to all purchases and sales of our portfolio
securities. To carry out such decisions, you are hereby authorized, as our agent
and attorney-in-fact, for our account and at our risk and in our name, to place
orders for the investment and reinvestment of our assets. In all purchases,
sales and other transactions in our portfolio securities you are authorized to
exercise full discretion and act for us in the same manner and with the same
force and effect as our corporation itself might or could do with respect to
such purchases, sales or other transactions, as well as with respect to all
other things necessary or incidental to the furtherance or conduct of such
purchases, sales or other transactions. In furtherance of such and subject to
applicable law and procedures adopted by the Fund's Board of Directors, you may
(i) pay commissions to brokers other than yourself which are higher than such
that might be charged by another qualified broker to obtain brokerage and/or
research services considered by you to be useful or desirable for your
investment management of the Portfolio and/or other advisory accounts of yours
and any investment advisor affiliated
with you; and (ii) consider the sales of shares of the Portfolio by brokers
including your affiliates as a factor in your selection of brokers for Portfolio
transactions.
(c) You will report to our Board of Directors at each meeting
thereof all changes in our portfolio since your prior report, and will also keep
us in touch with important developments affecting our portfolio and, on your own
initiative, will furnish us from time to time with such information as you may
believe appropriate for this purpose, whether concerning the individual entities
whose securities are included in our portfolio, the activities in which such
entities engage, Federal income tax policies applicable to our investments, or
the conditions prevailing in the money market or the economy generally. You will
also furnish us with such statistical and analytical information with respect to
our portfolio securities as you may believe appropriate or as we may reasonably
request. In making such purchases and sales of our portfolio securities, you
will comply with the policies set from time to time by our Board of Directors as
well as the limitations imposed by our Amended Articles of Incorporation, the
provisions of the Internal Revenue Code relating to regulated investment
companies and the 1940 Act, and the limitations contained in the Registration
Statement.
(d) It is understood that you will from time to time employ,
subcontract with or otherwise associate yourself with, entirely at your expense
such persons as you believe to be particularly fitted to assist you in the
execution of your duties hereunder.
(e) You or your affiliates will also provide supervisory
personnel who will be responsible for supervising and monitoring the performance
of our Administrator in connection with its duties under our Administrative
Services Agreement and for supervising the performance of other administrative
services, accounting and related services, net asset value and yield
calculations, reports to and filings with regulatory authorities, and services
relating to such functions. Such personnel may be your employees or employees of
your affiliates or of other organizations. It is understood that we have
retained, at our expense, an Administrator to perform the operational components
of the functions and services listed herein.
(f) You or your affiliates will also furnish us such
additional administrative supervision and such office facilities as you may
believe appropriate or as we may reasonably request subject to the requirements
of any regulatory authority to which you may be subject. We will reimburse you
for all of our operating costs incurred by you, including rent, depreciation of
equipment and facilities, interest and amortization of loans financing equipment
used by us and all the expenses incurred to conduct our affairs. The amounts of
such reimbursements shall from time to time be agreed upon between us.
3. We agree, subject to the limitations described below, to be
responsible for, and hereby assume the obligation for payment of, all our
expenses including: (a) brokerage and commission expenses; (b) foreign, federal,
state or local taxes, including issuance and transfer taxes incurred
-2-
by or levied on us; (c) commitment fees, certain insurance premiums and
membership fees and dues in investment company organizations; (d) interest
charges on borrowings; (e) charges and expenses of our custodian; (f) charges
and expenses relating to the issuance, redemption, transfer and dividend
disbursing functions for us; (g) telecommunications expenses; (h) recurring and
non-recurring legal, accounting and recordkeeping expenses; (i) costs of
organizing and maintaining the Fund's existence as a corporation; (j)
compensation, including directors' fees, of any of our directors, officers or
employees who are not your officers or officers employees of the Administrator
or their affiliates, and costs of other personnel providing administrative and
clerical services to us; (k) costs of providing shareholders' services,
including charges and expenses of persons providing confirmations of
transactions in the Portfolio's shares, periodic statements to shareholders and
recordkeeping services, and costs of shareholders' reports, proxy solicitations,
and corporate meetings; (l) fees and expenses of registering our shares under
the appropriate federal securities laws and of qualifying our shares under
applicable state securities laws, including expenses attendant upon the initial
registration and qualification of these shares and attendant upon renewals of,
or amendment to, those registrations and qualifications; (m) expenses of
preparing, printing and delivering the initial registration statement and of
preparing, printing and delivering the Prospectus to existing shareholders and
of printing shareholder application forms for shareholder accounts; (n) fees and
expenses payable to the Advisor, Distributor, Administrator, custodian, transfer
agent and dividend agent; and (o) any other distribution or promotional expenses
contemplated by an effective plan adopted by us pursuant to Rule 12b-1 under the
Act. Our obligation for the foregoing expenses is limited by your agreement to
be responsible, while this Agreement is in effect, for any amount by which our
annual operating expenses, including distribution expenses, (excluding taxes,
brokerage, interest and extraordinary expenses) exceed the limits on investment
company expenses prescribed by any state in which the Portfolio's shares are
qualified for sale.
4. We will expect of you, and you will give us the benefit of,
your best judgment and efforts in rendering these services to us, and we agree
as an inducement to your undertaking these services that you will not be liable
hereunder for any mistake of judgment or for any other cause, provided that
nothing herein shall protect you against any liability to us or to our security
holders by reason of willful misfeasance, bad faith or gross negligence in the
performance of your duties hereunder, or by reason of your reckless disregard of
your obligations and duties hereunder.
5. (a) In consideration of the foregoing we will pay you a fee
computed daily and payable monthly, in accordance with the following schedule:
.80% of the first $100 million of the Portfolio's average net assets; .75% of
the second $100 million of the Portfolio's average net assets; and .70% of the
Portfolio's average net assets exceeding $200 million. Your fee will be accrued
by us daily, and will be payable on the last day of each calendar month for
services performed hereunder during that month or on such other schedule as you
shall request of us in writing. You may waive your right to any fee to which you
are entitled hereunder, provided such waiver is delivered to us in writing. Any
reimbursement of our expenses, to which we may become entitled pursuant to
paragraph 3 hereof, will be paid to us at the end of the
-3-
month for which those expenses are accrued, at the same time as we pay you
your fee.
(b) Pursuant to the Portfolio's Distribution and Service Plan,
the Advisor will also act as a shareholder servicing agent for the Portfolio
pursuant to which the Portfolio is permitted to pay the Advisor a maximum of
.25% per annum of the Portfolio's average daily net assets to compensate it and
to permit the Advisor to compensate banks, savings and loans and other financial
institutions (the Advisor with such other institutions, each a "Shareholder
Servicing Agent") whose clients are Portfolio shareholders for providing
shareholder services. In addition, the Advisor may use the advisory fee for
distribution and servicing purposes including defraying the costs of performing
shareholder servicing functions on behalf of the Portfolio, compensating others,
including banks, broker-dealers and other organizations whose customers or
clients are shareholders of the Portfolio for providing assistance in
distributing the Portfolio's shares and defraying the cost of shareholder
servicing and other promotional activities. To the extent that you or your
affiliates directly may make payments to banks, securities dealers and other
third parties who engage in the sale of our shares or who render shareholder
support services, and that such payments may be deemed indirect financing of an
activity primarily intended to result in the sale of shares of the Portfolio
within the context of Rule 12b-1 under the 1940 Act (the "Rule"), then such
payments by you shall be deemed to be authorized under the Portfolio's
Distribution and Service Plan adopted pursuant to the Rule. You, will, in your
sole discretion, determine the amount of such payments and may from time to time
in your sole discretion increase or decrease the amount of such payments;
provided, however, that no such payment will increase the amount the Portfolio
is required to pay you or any person under this Agreement or any agreement. Any
payments made by you for such purposes are subject to compliance with the terms
of written agreements in a form satisfactory to the Fund's Board of Directors to
be entered into by you and the participating organization.
6. This Agreement will become effective on October 12, 1993 and
shall continue in effect until October 12, 1995 and thereafter for successive
twelve-month periods (computed from each October 1), provided that such
continuation is specifically approved at least annually by our Board of
Directors or by a majority vote of the holders of our outstanding voting
securities, as defined in the 1940 Act, and, in either case, by a majority of
those of our directors who are neither party to this Agreement nor, other than
by their service as directors of the corporation, interested persons, as defined
in the 1940 Act, of any such person who is party to this Agreement. Upon the
effectiveness of this Agreement, it shall supersede all previous Agreements
between us covering the subject matter hereof. This Agreement may be terminated
at any time, without the payment of any penalty, by vote of a majority of our
outstanding voting securities, as defined in the 1940 Act, or by a vote of a
majority of our entire Board of Directors, on sixty days' written notice to you,
or by you on sixty days' written notice to us.
7. This Agreement may not be transferred, assigned, sold or in
any manner hypothecated or pledged by you and this Agreement shall terminate
automatically in the event of any such transfer, assignment, sale,
-4-
hypothecation or pledge by you. The terms "transfer", "assignment" and "sale" as
used in this paragraph shall have the meanings ascribed thereto by governing law
and in applicable rules or regulations of the Securities and Exchange
Commission.
8. Except to the extent necessary to perform your obligations
hereunder, nothing herein shall be deemed to limit or restrict your right, or
the right of any of your officers, directors or employees who may also be a
director, officer or employee of ours, or of a person affiliated with us, as
defined in the Act, 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.
If the foregoing is in accordance with your understanding, will
you kindly so indicate by signing and returning to us the enclosed copy hereof.
Very truly yours,
OLD WESTBURY FUNDS, INC.
Old Westbury International Fund
By: /s/ XXXXX X. XXXXXX
Name: Xxxxx X. Xxxxxx
Title: Treasurer
ACCEPTED: October 12, 1993
BESSEMER TRUST COMPANY, N.A.
By: /s/ XXXXXX X. XXXXXX
Name: Xxxxxx X. Xxxxxxx
Title: Senior Executive Vice President
-5-
ADVISORY CONTRACT
OLD WESTBURY FUNDS, INC. (the "Fund")
Old Westbury Fixed Income Fund (the "Portfolio")
Federated Investors Funds
0000 Xxxxxxxxx Xxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000-0000
November 13, 1997
Bessemer Trust Company, N.A.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Gentlemen:
We herewith confirm our agreement with you as follows:
1. We propose to engage in the business of investing and reinvesting our
assets in securities of the type, and in accordance with the limitations,
specified in our Articles of Incorporation, By-Laws and Registration Statement
filed with the Securities and Exchange Commission under the Investment Company
Act of 1940 (the "1940 Act') and the Securities Act of 1933, including the
Prospectus forming a part thereof (the "Registration Statement"), all as from
time to time in effect, and in such manner and to such extent as may from time
to time be authorized by our Board of Directors. We enclose copies of the
documents listed above and will furnish you such amendments thereto as may be
made from time to time.
-1-
2. (a) We hereby employ you to manage the investment and reinvestment of
our assets as above specified, and, without limiting the generality of the
foregoing, to provide the management and other services specified below.
(b) Subject to the general control of our Board of Directors, you
will make decisions with respect to all purchases and sales of our portfolio
securities. To carry out such decisions, you are hereby authorized, as our agent
and attorney-in-fact, for our account and at our risk and in our name, to place
orders for the investment and reinvestment of our assets. In all purchases,
sales and other transactions in our portfolio securities you are authorized to
exercise full discretion and act for us in the same manner and with the same
force and effect as our corporation itself might or could do with respect to
such purchases, sales or other transactions, as well as with respect to all
other things necessary or incidental to the furtherance or conduct of such
purchases, sales or other transactions. In furtherance of such and subject to
applicable law and procedures adopted by the Fund's Board of Directors, you may
(i) pay commissions to brokers other than yourself which are higher than such
that might be charged by another qualified broker to obtain brokerage and/or
research services considered by you to be useful or desirable for your
investment management of the Portfolio and/or other advisory accounts of yours
and any investment advisor affiliated with you: and (ii) consider the sales of
shares of the Portfolio by brokers including your affiliates as a factor in your
selection of brokers for Portfolio transactions.
(c) You will report to our Board of Directors at each meeting
thereof all changes in our portfolio since your prior report, and will also keep
us in touch with important developments affecting our portfolio and, on your own
initiative, will furnish us from time to time with such information as you may
believe appropriate for this purpose, whether concerning the individual entities
whose securities are included in our portfolio, the activities in which such
entities engage, Federal income tax policies applicable to our investments, or
the conditions prevailing in the money market or the economy generally. You will
also furnish us with such statistical and analytical information with respect to
our portfolio securities as you may believe appropriate or as we may reasonably
request. In making such purchases and sales of our portfolio securities, you
will comply with the policies set from time to time by our Board of Directors as
well as the limitations imposed by our Amended Articles of Incorporation, the
provisions of the Internal Revenue Code relating to regulated investment
companies and the 1940 Act, and the limitations contained in the Registration
Statement.
(d) It is understood that you will from time to time employ,
subcontract with or otherwise associate yourself with, entirely at your expense
such persons as you believe to be particularly fitted to assist you in the
execution of your duties hereunder.
(e) You or your affiliates will also provide supervisory personnel
who will be responsible for supervising and monitoring the performance of our
Administrator in connection with its duties under our Administrative Services
Agreement and for supervising the performance of other administrative services,
accounting and related services, net asset value and yield calculations, reports
to and filings with regulatory authorities, and services relating to such
functions. Such personnel may be your employees or employees of your affiliates
or of other organizations. It is understood that we have retained, at our
expense, an Administrator to perform the operational components of the functions
and services listed herein.
(f) You or your affiliates will also furnish us such additional
administrative supervision and such office facilities as you may believe
-2-
appropriate or as we may reasonably request subject to the requirements of any
regulatory authority to which you may be subject. We will reimburse you for all
of our operating costs incurred by you, including rent, depreciation of
equipment and facilities, interest and amortization of loans financing equipment
used by us and all the expenses incurred to conduct our affairs. The amounts of
such reimbursements shall from time to time be agreed upon between us.
3. We agree, subject to the limitations described below, to be
responsible for, and hereby assume the obligation for payment of, all our
expenses including: (a) brokerage and commission expenses; (b) foreign, federal,
state or local taxes, including issuance and transfer taxes incurred by or
levied on us; (c) commitment fees, certain insurance premiums and membership
fees and dues in investment company organizations; (d) interest charges on
borrowings; (e) charges and expenses of our custodian; (f) charges and expenses
relating to the issuance, redemption, transfer and dividend disbursing functions
for us; (g) telecommunications expenses; (h) recurring and non-recurring legal,
accounting and recordkeeping expenses; (i) costs of organizing and maintaining
the Fund's existence as a corporation; (j) compensation, including directors'
fees, of any of our directors, officers or employees who are not your officers
or officers employees of the Administrator or their affiliates, and costs of
other personnel providing administrative and clerical service to us; (k) costs
of providing shareholders' services, including charges and expenses of persons
providing confirmations of transactions in the Portfolio's shares, periodic
statements to shareholders and recordkeeping services, and costs of
shareholders' reports, proxy solicitations, and corporate meetings; (l) fees and
expenses of registering our shares under the appropriate federal securities laws
and of qualifying our shares under applicable state securities laws, including
expenses attendant upon the initial registration and qualification of these
shares and attendant upon renewals of, or amendment to, those registrations and
qualifications; (m) expenses of preparing, printing and delivering the initial
registration statement and of preparing, printing and delivering the Prospectus
to existing shareholders and of printing shareholder application forms for
shareholder accounts; (n) fees and expenses payable to the Advisor, Distributor,
Administrator, custodian, transfer agent and dividend agent; and (o) any other
distribution or promotional expenses contemplated by an effective plan adopted
by us pursuant to Rule 12b-1 under the Act. Our obligation for the foregoing
expenses is limited by your agreement to be responsible, while this Agreement is
in effect, for any amount by which our annual operating expenses, including
distribution expenses, (excluding taxes, brokerage, interest and extraordinary
expenses) exceed the limits on investment company expenses prescribed by any
state in which the Portfolio's shares are qualified for sale.
4. We will expect of you, and you will give us the benefit of, your best
judgment and efforts in rendering these services to us, and we agree as an
inducement to your undertaking these services that you will not be liable
hereunder for any mistake of judgment or for any other cause, provided that
nothing herein shall protect you against any liability to us or to our security
holders by reason of willful misfeasance, bad faith or gross negligence in the
performance of your duties hereunder, or by reason of your reckless disregard of
your obligations and duties hereunder.
5. (a) In consideration of the foregoing we will pay you a fee computed
daily and payable monthly, in accordance with the following schedule: .45% of
the first $100 million of the Portfolio's average net assets; .40% of the second
$100 million of the Portfolio's average net assets; and .35% of the Portfolio's
average net assets exceeding $200 million. Your fee will be accrued by us daily,
and will be payable on the last day of each calendar month for services
performed hereunder during that month or on such other schedule as you shall
request of us in writing. You may waive your right to any fee to which you are
-3-
entitled hereunder, provided such waiver is delivered to us in writing. Any
reimbursement of our expenses, to which we may become entitled pursuant to
paragraph 3 hereof, will be paid to us at the end of the month for which those
expenses are accrued, at the same time as we pay your fee.
(b) Pursuant to the Portfolio's Distribution and Service Plan, the
Advisor will also act as a shareholder servicing agent for the Portfolio
pursuant to which the Portfolio is permitted to pay the Advisor a maximum of
.25% per annum of the Portfolio's average daily net assets to compensate it and
to permit the Advisor to compensate banks, savings and loans and other financial
institutions (the Advisor with such other institutions, each a "Shareholder
Servicing Agent") whose clients are Portfolio shareholders for providing
shareholder services. In addition, the Advisor may use the advisory fee for
distribution and servicing functions on behalf of the Portfolio, compensating
others, including banks, broker-dealers and other organizations whose customers
or clients are shareholders of the Portfolio for providing assistance in
distributing the Portfolio's shares and defraying the cost of shareholder
servicing and other promotional activities. To the extent that you or your
affiliates directly may make payments to banks, securities dealers and other
third parties who engage in the sale of our shares or who render shareholder
support services, and that such payments may be deemed indirect financing of an
activity primarily intended to result in the sale of shares of the Portfolio
within the context of Rule 12b-1 under the 1940 Act (the "Rule"), then such
payments by you shall be deemed to be authorized under the Portfolio's
Distribution and Service Plan adopted pursuant to the Rule. You, will, in your
sole discretion, determine the amount of such payments and may from time to time
in your sole discretion increase or decrease the amount the Portfolio is
required to pay you or any person under this Agreement or any agreement. Any
payments made by you for such purposes are subject to compliance with the terms
of written agreements in a form satisfactory to the Fund's Board of Directors to
be entered into by you and the participating organization.
6. This Agreement will become effective on November 13, 1997 and shall
continue in effect until November 13, 1999 and thereafter for successive
twelve-month periods (computed from each November 1), provided that such
continuation is specifically approved at least annually by our Board of
Directors or by a majority vote of the holders of our outstanding voting
securities, as defined in the 1940 Act, and, in either case, by a majority of
those of our directors who are neither party to this Agreement nor, other than
by their service as directors of the corporation, interested persons, as defined
in the 1940 Act, of any such person who is party to this Agreement. Upon
effectiveness of this Agreement, it shall supersede all previous Agreements
between us covering the subject matter hereof. This Agreement may be terminated
at any time, without the payment of any penalty, by vote of a majority of our
outstanding voting securities as defined in the 1940 Act, or by a vote of
majority of our entire Board of Directors, on sixty days' written notice to you,
or by you on sixty days' written notice to us.
7. This Agreement may not be transferred, assigned, sold or in any manner
hypothecated or pledged by you and this Agreement shall terminate automatically
in the event of any such transfer, assignment, sale, hypothecation or pledge by
you. The terms "transfer", "assignment" and "sale" as used in this paragraph
shall have the meanings ascribed thereto by governing law and in applicable
rules or regulations of the Securities and Exchange Commission.
8. Except to the extent necessary to perform your obligations hereunder,
nothing herein shall be deemed to limit or restrict your right, or the right of
any of your officers, directors or employees who may also be a director, officer
or employee of ours, or a person affiliated with us, as defined in the Act, to
-4-
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.
If the foregoing is in accordance with your understanding, you will kindly
so indicate by signing and returning to us the enclosed copy hereof.
Very truly yours,
OLD WESTBURY FUNDS, INC.
Old Westbury Fixed Income Fund
By: /s/ C. Xxxxxxxxx Xxxxxxx
Name: C. Xxxxxxxxx Xxxxxxx
Title: Vice President
ACCEPTED: November 13, 1997
BESSEMER TRUST COMPANY, N.A.
By: /s/ Xxxxxx X. Xxxxxxx
Name: Xxxxxx X. Xxxxxxx
Title: Senior Executive Vice President
-5-
ADVISORY CONTRACT
OLD WESTBURY FUNDS, INC. (the "Fund")
Old Westbury Municipal Bond Fund (the "Portfolio")
Federated Investors Funds
0000 Xxxxxxxxx Xxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000-0000
November 13, 1997
Bessemer Trust Company, N.A.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Gentlemen:
We herewith confirm our agreement with you as follows:
1. We propose to engage in the business of investing and reinvesting our
assets in securities of the type, and in accordance with the limitations,
specified in our Articles of Incorporation, By-Laws and Registration Statement
filed with the Securities and Exchange Commission under the Investment Company
Act of 1940 (the "1940 Act') and the Securities Act of 1933, including the
Prospectus forming a part thereof (the "Registration Statement"), all as from
time to time in effect, and in such manner and to such extent as may from time
to time be authorized by our Board of Directors. We enclose copies of the
documents listed above and will furnish you such amendments thereto as may be
made from time to time.
-1-
2. (a) We hereby employ you to manage the investment and reinvestment of
our assets as above specified, and, without limiting the generality of the
foregoing, to provide the management and other services specified below.
(b) Subject to the general control of our Board of Directors, you
will make decisions with respect to all purchases and sales of our portfolio
securities. To carry out such decisions, you are hereby authorized, as our agent
and attorney-in-fact, for our account and at our risk and in our name, to place
orders for the investment and reinvestment of our assets. In all purchases,
sales and other transactions in our portfolio securities you are authorized to
exercise full discretion and act for us in the same manner and with the same
force and effect as our corporation itself might or could do with respect to
such purchases, sales or other transactions, as well as with respect to all
other things necessary or incidental to the furtherance or conduct of such
purchases, sales or other transactions. In furtherance of such and subject to
applicable law and procedures adopted by the Fund's Board of Directors, you may
(i) pay commissions to brokers other than yourself which are higher than such
that might be charged by another qualified broker to obtain brokerage and/or
research services considered by you to be useful or desirable for your
investment management of the Portfolio and/or other advisory accounts of yours
and any investment advisor affiliated with you: and (ii) consider the sales of
shares of the Portfolio by brokers including your affiliates as a factor in your
selection of brokers for Portfolio transactions.
(c) You will report to our Board of Directors at each meeting
thereof all changes in our portfolio since your prior report, and will also keep
us in touch with important developments affecting our portfolio and, on your own
initiative, will furnish us from time to time with such information as you may
believe appropriate for this purpose, whether concerning the individual entities
whose securities are included in our portfolio, the activities in which such
entities engage, Federal income tax policies applicable to our investments, or
the conditions prevailing in the money market or the economy generally. You will
also furnish us with such statistical and analytical information with respect to
our portfolio securities as you may believe appropriate or as we may reasonably
request. In making such purchases and sales of our portfolio securities, you
will comply with the policies set from time to time by our Board of Directors as
well as the limitations imposed by our Amended Articles of Incorporation, the
provisions of the Internal Revenue Code relating to regulated investment
companies and the 1940 Act, and the limitations contained in the Registration
Statement.
(d) It is understood that you will from time to time employ,
subcontract with or otherwise associate yourself with, entirely at your expense
such persons as you believe to be particularly fitted to assist you in the
execution of your duties hereunder.
(e) You or your affiliates will also provide supervisory personnel
who will be responsible for supervising and monitoring the performance of our
Administrator in connection with its duties under our Administrative Services
Agreement and for supervising the performance of other administrative services,
accounting and related services, net asset value and yield calculations, reports
to and filings with regulatory authorities, and services relating to such
functions. Such personnel may be your employees or employees of your affiliates
or of other organizations. It is understood that we have retained, at our
expense, an Administrator to perform the operational components of the functions
and services listed herein.
(f) You or your affiliates will also furnish us such additional
administrative supervision and such office facilities as you may believe
-2-
appropriate or as we may reasonably request subject to the requirements of any
regulatory authority to which you may be subject. We will reimburse you for all
of our operating costs incurred by you, including rent, depreciation of
equipment and facilities, interest and amortization of loans financing equipment
used by us and all the expenses incurred to conduct our affairs. The amounts of
such reimbursements shall from time to time be agreed upon between us.
3. We agree, subject to the limitations described below, to be responsible
for, and hereby assume the obligation for payment of, all our expenses
including: (a) brokerage and commission expenses; (b) foreign, federal, state or
local taxes, including issuance and transfer taxes incurred by or levied on us;
(c) commitment fees, certain insurance premiums and membership fees and dues in
investment company organizations; (d) interest charges on borrowings; (e)
charges and expenses of our custodian; (f) charges and expenses relating to the
issuance, redemption, transfer and dividend disbursing functions for us; (g)
telecommunications expenses; (h) recurring and non-recurring legal, accounting
and recordkeeping expenses; (i) costs of organizing and maintaining the Fund's
existence as a corporation; (j) compensation, including directors' fees, of any
of our directors, officers or employees who are not your officers or officers
employees of the Administrator or their affiliates, and costs of other personnel
providing administrative and clerical service to us; (k) costs of providing
shareholders' services, including charges and expenses of persons providing
confirmations of transactions in the Portfolio's shares, periodic statements to
shareholders and recordkeeping services, and costs of shareholders' reports,
proxy solicitations, and corporate meetings; (l) fees and expenses of
registering our shares under the appropriate federal securities laws and of
qualifying our shares under applicable state securities laws, including expenses
attendant upon the initial registration and qualification of these shares and
attendant upon renewals of, or amendment to, those registrations and
qualifications; (m) expenses of preparing, printing and delivering the initial
registration statement and of preparing, printing and delivering the Prospectus
to existing shareholders and of printing shareholder application forms for
shareholder accounts; (n) fees and expenses payable to the Advisor, Distributor,
Administrator, custodian, transfer agent and dividend agent; and (o) any other
distribution or promotional expenses contemplated by an effective plan adopted
by us pursuant to Rule 12b-1 under the Act. Our obligation for the foregoing
expenses is limited by your agreement to be responsible, while this Agreement is
in effect, for any amount by which our annual operating expenses, including
distribution expenses, (excluding taxes, brokerage, interest and extraordinary
expenses) exceed the limits on investment company expenses prescribed by any
state in which the Portfolio's shares are qualified for sale.
4. We will expect of you, and you will give us the benefit of, your best
judgment and efforts in rendering these services to us, and we agree as an
inducement to your undertaking these services that you will not be liable
hereunder for any mistake of judgment or for any other cause, provided that
nothing herein shall protect you against any liability to us or to our security
holders by reason of willful misfeasance, bad faith or gross negligence in the
performance of your duties hereunder, or by reason of your reckless disregard of
your obligations and duties hereunder.
5. (a) In consideration of the foregoing we will pay you a fee computed
daily and payable monthly, in accordance with the following schedule: .45% of
the first $100 million of the Portfolio's average net assets; .40% of the second
$100 million of the Portfolio's average net assets; and .35% of the Portfolio's
average net assets exceeding $200 million. Your fee will be accrued by us daily,
and will be payable on the last day of each calendar month for services
performed hereunder during that month or on such other schedule as you shall
request of us in writing. You may waive your right to any fee to which you are
-3-
entitled hereunder, provided such waiver is delivered to us in writing. Any
reimbursement of our expenses, to which we may become entitled pursuant to
paragraph 3 hereof, will be paid to us at the end of the month for which those
expenses are accrued, at the same time as we pay your fee.
(b) Pursuant to the Portfolio's Distribution and Service Plan, the
Advisor will also act as a shareholder servicing agent for the Portfolio
pursuant to which the Portfolio is permitted to pay the Advisor a maximum of
.25% per annum of the Portfolio's average daily net assets to compensate it and
to permit the Advisor to compensate banks, savings and loans and other financial
institutions (the Advisor with such other institutions, each a "Shareholder
Servicing Agent") whose clients are Portfolio shareholders for providing
shareholder services. In addition, the Advisor may use the advisory fee for
distribution and servicing functions on behalf of the Portfolio, compensating
others, including banks, broker-dealers and other organizations whose customers
or clients are shareholders of the Portfolio for providing assistance in
distributing the Portfolio's shares and defraying the cost of shareholder
servicing and other promotional activities. To the extent that you or your
affiliates directly may make payments to banks, securities dealers and other
third parties who engage in the sale of our shares or who render shareholder
support services, and that such payments may be deemed indirect financing of an
activity primarily intended to result in the sale of shares of the Portfolio
within the context of Rule 12b-1 under the 1940 Act (the "Rule"), then such
payments by you shall be deemed to be authorized under the Portfolio's
Distribution and Service Plan adopted pursuant to the Rule. You, will, in your
sole discretion, determine the amount of such payments and may from time to time
in your sole discretion increase or decrease the amount the Portfolio is
required to pay you or any person under this Agreement or any agreement. Any
payments made by you for such purposes are subject to compliance with the terms
of written agreements in a form satisfactory to the Fund's Board of Directors to
be entered into by you and the participating organization.
6. This Agreement will become effective on November 13, 1997, and shall
continue in effect until November 13, 1999 and thereafter for successive
twelve-month periods (computed from each November 1), provided that such
continuation is specifically approved at least annually by our Board of
Directors or by a majority vote of the holders of our outstanding voting
securities, as defined in the 1940 Act, and, in either case, by a majority of
those of our directors who are neither party to this Agreement nor, other than
by their service as directors of the corporation, interested persons, as defined
in the 1940 Act, of any such person who is party to this Agreement. Upon
effectiveness of this Agreement, it shall supersede all previous Agreements
between us covering the subject matter hereof. This Agreement may be terminated
at any time, without the payment of any penalty, by vote of a majority of our
outstanding voting securities as defined in the 1940 Act, or by a vote of
majority of our entire Board of Directors, on sixty days' written notice to you,
or by you on sixty days' written notice to us.
7. This Agreement may not be transferred, assigned, sold or in any manner
hypothecated or pledged by you and this Agreement shall terminate automatically
in the event of any such transfer, assignment, sale, hypothecation or pledge by
you. The terms "transfer", "assignment" and "sale" as used in this paragraph
shall have the meanings ascribed thereto by governing law and in applicable
rules or regulations of the Securities and Exchange Commission.
8. Except to the extent necessary to perform your obligations hereunder,
nothing herein shall be deemed to limit or restrict your right, or the right of
any of your officers, directors or employees who may also be a director, officer
or employee of ours, or a person affiliated with us, as defined in the Act, to
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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.
If the foregoing is in accordance with your understanding, you will kindly
so indicate by signing and returning to us the enclosed copy hereof.
Very truly yours,
OLD WESTBURY FUNDS, INC.
Old Westbury Municipal Bond Fund
By: /s/ C. Xxxxxxxxx Xxxxxxx
Name: C. Xxxxxxxxx Xxxxxxx
Title: Vice President
ACCEPTED: November 13, 1997
BESSEMER TRUST COMPANY, N.A.
By: /s/ Xxxxxx X. Xxxxxxx
Name: Xxxxxx X. Xxxxxxx
Title: Senior Executive Vice President
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