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EXHIBIT 5
INVESTMENT ADVISORY AGREEMENT
OLD MUTUAL SOUTH AFRICA EQUITY TRUST
THIS INVESTMENT ADVISORY AGREEMENT, dated as of October 23, 1995 (this
"Agreement"), by and between Old Mutual South Africa Equity Trust, a
Massachusetts trust (the "Trust"), and Old Mutual Asset Managers (Bermuda)
Limited (the "Adviser");
WITNESSETH:
WHEREAS, the Trust will engage in business as an open-end investment
company registered under the United States Investment Company Act of 1940
(collectively with the rules and regulations promulgated thereunder, the "1940
Act"),
WHEREAS, Old Mutual Fund Holdings (Bermuda) Limited, a Bermuda company,
Old Mutual Equity Growth Assets South Africa Fund, a Massachusetts business
trust that will register under the 1940 Act, and Old Mutual South Africa Growth
Assets Fund, a Bermuda mutual fund that is to be listed on the Irish Stock
Exchange (the "ISO"), are expected to acquire beneficial interests in the Trust,
and
WHEREAS, the Trust wishes to engage the Adviser to provide certain
investment advisory services for the Trust, and the Adviser is willing to
provide such investment advisory services for the Trust on the terms and
conditions hereinafter set forth,
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements herein set forth, the parties covenant and agree as
follows:
1. Duties of the Adviser. The Trust engages the Adviser as
investment adviser to the Trust upon the terms and conditions of this Agreement,
and the Adviser accepts such engagement. The Adviser shall act as investment
adviser of the Trust and in that capacity shall:
(a) provide the Trust with such investment advice and supervision
as the Trust may from time to time consider necessary for the
proper supervision of the Trust's investment assets,
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(b) determine from time to time what securities shall be
purchased, sold or exchanged and what portion of the assets of
the Trust shall be held uninvested, and
(c) make recommendations as to the manner in which voting rights,
rights to consent to corporate action and any other rights
pertaining to the Trust's securities shall be exercised,
provided, however, the Adviser's performance of such duties shall be subject
always to the restrictions contained within:
(a) the Trust's Declaration of Trust, dated as of September 1,
1995 (the "Declaration"),
(b) the Trust's By-laws (the "By-laws"),
(c) the 1940 Act,
(d) the rules of the ISO,
(e) the then-current Registration Statement of the Trust under the
1940 Act, and
(f) such determinations of investment policy for the Trust as the
Board may from time to time establish with notice to the
Adviser (provided the Adviser shall be bound by any such
policy for the period, if any, specified in such notice or
until similarly notified that such policy has been revoked).
The Adviser shall take, on behalf of the Trust, all actions which it deems
necessary to implement the investment policies of the Trust, and in particular
to place all orders for the purchase or sale of securities for the Trust's
account with the brokers or dealers selected by the Adviser, and to that end the
Adviser is authorized as the agent of the Trust to give instructions to the
custodian (and any subcustodians) of the Trust as to deliveries of securities
and payments of cash for the account of the Trust. In connection with the
selection of brokers or dealers for the Trust and the placing of such orders,
the Adviser is directed to seek for the Trust in its best judgment, prompt
execution in an effective manner at the most favorable price. Subject to this
requirement of seeking the most favorable price, securities may be bought from
or sold to broker-dealers who have furnished statistical, research and other
information or services to the Adviser or the Trust, subject to any applicable
laws, rules and regulations.
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2. Allocation of Charges and Expenses. The Adviser shall furnish
at its own expense all services, facilities and personnel necessary or
convenient to perform its duties under Section 1 above. The Trust will pay from
its assets all of its own expenses allocable to the Trust including compensation
of Trustees not employed by the Adviser or a parent company of the Adviser;
governmental fees; interest charges; taxes; membership dues in the Investment
Company Institute allocable to the Trust; fees and expenses of independent
auditors and of legal counsel of the Trust; expenses of issuing and redeeming
beneficial interests in the Trust and servicing Holder (as defined in the
Declaration) accounts; expenses of preparing, printing and mailing, notices,
proxy statements and reports to governmental officers and commissions and to
Holders; expenses connected with the execution, recording and settlement of
security transactions; insurance premiums; fees and expenses of the custodian
(and any subcustodians) for all services to the Trust, including safekeeping of
funds and securities and maintaining required books and accounts; expenses of
calculating the net asset value of the Trust; and expenses of meetings of the
Trustees and Holders.
3. Compensation of the Adviser. For the services to be rendered
under this Agreement, the Trust shall pay to the Adviser from the assets of the
Trust a management fee of 0.85% per annum of the Trust's daily net assets (the
"Management Fee"). The Management Fee shall accrue daily on an annualized basis
and be paid monthly in arrears. If the Adviser serves under this Agreement for
less than the whole of any period specified in this Section 3, the Management
Fee shall be prorated for such partial period.
4. Covenants of the Adviser. The Adviser shall throughout the
term of this Agreement:
(a) not deal with itself, or with the Trustees of the Trust as
principals, in making purchases or sales of securities or
other property for the account of the Trust, except as
permitted by the 1940 Act and the rules of the ISO,
(b) not take a long or short position in shares of the Trust
except as permitted by the Declaration,
(c) comply with all other provisions of the 1940 Act, the ISO
rules, the Declaration, the By-laws and the then-current 1940
Act Registration Statement of the Trust relative to the
Adviser and its directors and officers, and
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(d) maintain its registration under the United States Investment
Advisers Act of 1940, comply with rules thereunder and notify
the Trustees of any proceedings to revoke, suspend or modify
such registration.
5. Limitation of Liability of the Adviser. The Adviser shall not
be liable for any error of judgment, mistake of law, loss arising out of any
investment or act or omission in the execution of securities transactions for
the Trust, except for willful misfeasance, bad faith or gross negligence in the
performance of its duties, or by reason of reckless disregard of its obligations
and duties hereunder. As used in this Section 5, the term "Adviser" shall
include directors, officers and employees of the Adviser.
6. Activities of the Adviser. The engagement of the Adviser under
this Agreement shall not be exclusive, and the Adviser shall be free to render
investment advisory and/or other services to others. The Trust shall have no
right or interest in any income from any such services. It is understood that
Trustees, officers, and Holders of the Trust are or may be or may become
interested in the Adviser, as directors, officers, employees, or otherwise and
that directors, officers and employees of the Adviser are or may become
similarly interested in the Trust and that the Adviser and/or its affiliates may
be or may become interested in the Trust as a Holder or otherwise.
7. Duration, Termination and Amendment of this Agreement.
(a) This Agreement shall become effective as of the day and year
first above written and shall govern the relations between the
parties hereto thereafter, and shall remain in force until
October 23, 1997 on which date it will terminate unless its
continuance after October 23, 1997 is "specifically approved
at least annually" (i) by the vote of a majority of the
Trustees of the Trust who are not "interested persons" of the
Trust or of the Adviser at a meeting specifically called for
the purpose of voting on such approval, and (ii) by the Board
of Trustees of the Trust or by "vote of a majority of the
outstanding voting securities" of the Trust.
(b) This Agreement may be terminated at any time without the
payment of any penalty by the Trustees or by the "vote of a
majority of the outstanding voting securities" of the Trust,
or by the Adviser, in each case on not more than 60 days' nor
less than 30 days' written notice to the other party. This
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Agreement shall automatically terminate in the event of its
"assignment."
(c) This Agreement may be amended only if such amendment is
approved by the "vote of a majority of the outstanding voting
securities" of the Trust.
(d) The terms "specifically approved at least annually," "vote of
a majority of the outstanding voting securities,"
"assignment," "affiliated person," and "interested persons,"
when used in this Agreement, shall have the respective
meanings specified in, and shall be construed in a manner
consistent with, the 1940 Act, subject, however, to such
exemptions as may be granted by the United States Securities
and Exchange Commission under said Act.
8. Trust Obligations. The obligations of the Trust hereunder
shall not be binding upon any of the Trustees, Holders, nominees, officers,
agents or employees of the Trust, personally, but shall bind only the assets and
property of the Trust as provided in the Declaration.
9. Name of Trust. In the event the Adviser ceases for any reason
to serve as investment adviser of the Trust, the Trust shall forthwith upon
request by the Adviser (i) change its name so that it does not include the words
"Old Mutual", "OMEGA", "SAGA" or any variation or combination of any thereof,
and (ii) require any Holders to do the same (other than any Holder whose
continued use of such name is consented to in writing by the Adviser).
10. Notices. All notices, requests, and other communications
hereunder shall be in writing and shall be delivered by hand to an officer of
the addressee or sent by courier service or certified mail return receipt
requested, postage prepaid, addressed to the respective address of the
addressee. Any notice given pursuant to this Agreement shall be deemed to have
been given when delivered or when delivery is duly attempted and refused.
11. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the Commonwealth of Massachusetts,
subject to the applicable provisions of the 1940 Act, without regard to any
choice of law principles that would require application of the laws of any other
jurisdiction. The parties hereto absolutely and irrevocably consent to the
jurisdiction of the courts of the Commonwealth of Massachusetts and of any
Federal court located in said
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Commonwealth in connection with any actions or proceedings arising out of or
relating to this Agreement and waive any objection to the convenience of any
such court.
12. Headings. The descriptive section headings have been inserted
for convenience of reference only and do not define or limit the provisions
hereof.
13. Severability. If any term of this Agreement shall be held to
be invalid, illegal or unenforceable, the validity of all other terms hereof
shall be in no way affected thereby, and this Agreement shall be construed and
be enforceable as if such invalid, illegal or unenforceable term had not been
included herein.
14. Entire Agreement. This Agreement sets forth the entire
agreement of the parties hereto with respect to the subject matter hereof and
supersedes any prior negotiations, understandings or arrangements.
15. Counterparts. This Agreement may be executed in several
counterparts, each of which when executed and delivered is an original, but all
of which together shall constitute one instrument. In making proof of this
Agreement, it shall not be necessary to produce or account for more than one
such counterpart.
16. Rules of Interpretation. The following rules shall apply in
the construction and interpretation of this Agreement:
(a) The singular includes the plural, and the plural includes the
singular.
(b) A reference to any gender includes each other gender.
(c) A reference to any Person includes its legal successors and
permitted assigns.
(d) A reference to any contract, instrument, agreement or other
document, including any registration statement under the 1940 Act, shall include
any written amendment, supplement or modification thereto and any replacement
thereof.
(e) A reference to any statute, law, rule or regulation shall
include any amendment or modification thereto and any replacement thereof.
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(f) The words "include," "includes" and "including" are not
limiting.
(h) The words "hereof," "herein" and "hereunder" and words of
similar import shall refer to this Agreement as a whole and not to any
particular part of this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered in their names and on their behalf by the undersigned,
thereunto duly authorized, all as of the day and year first above written.
The undersigned Trustee or officer of the Trust has executed this
Agreement not individually, but as Trustee or officer under the Trust's
Declaration of Trust, dated as of September 1, 1995, as amended, and the
obligations of this Agreement are not binding upon any of the Trustees or
officers of the Trust individually.
OLD MUTUAL SOUTH AFRICA OLD MUTUAL ASSET
EQUITY TRUST MANAGERS (BERMUDA)
LIMITED
By: Xxxxxxx X. Xxxxxx By: Xxxxxxx Xxxxxxx
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Xxxxxxx X. Xxxxxx Xxxxxxx Xxxxxxx
Chairman of the Board President
