Exhibit (d)(2)
AMENDMENT NUMBER ONE
TO THE
INVESTMENT ADVISORY AGREEMENT
This Amendment Number One, dated June 1, 2005, to the Investment Advisory
Agreement dated May 31, 1997 (the "Agreement") by and between Xxx Xxxxxx High
Yield Fund (formerly known as Xxx Xxxxxx High Income Corporate Bond Fund), a
Delaware statutory trust (the "Fund"), and Xxx Xxxxxx Asset Management (the
"Adviser," successor in interest of Xxx Xxxxxx Asset Management, Inc.), a
Delaware statutory trust, hereby amends the terms and conditions of the
Agreement in the manner specified herein.
W I T N E S S E T H
WHEREAS, the Board of Trustees of the Fund at a meeting held on May 25, 2005 has
approved a change in the investment advisory fee payable by the Fund to the
Adviser; and
WHEREAS, the parties desire to amend and restate Section 3 of the Agreement
relating to the investment advisory fee.
NOW THEREFORE, in consideration of the foregoing and the mutual covenants and
agreements hereinafter contained, the parties hereby agree to amend the
Agreement, as follows:
Section 3 of the Agreement is hereby deleted in its entirety and replaced with
the following:
3. Compensation Payable to the Adviser.
The Fund shall pay to the Adviser, as compensation for the services rendered,
facilities furnished and expenses paid by the Adviser, a monthly fee computed at
the following annual rate:
AVERAGE DAILY FEE AS A PERCENT PER ANNUM
NET ASSETS OF AVERAGE DAILY NET ASSETS
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First $500 million 0.420%
Next $250 million 0.345%
Next $250 million 0.295%
Next $1 billion 0.270%
Next $1 billion 0.245%
Over $3 billion 0.220%
Average daily net assets shall be determined by taking the average of the net
assets for each business day during a given calendar month calculated in the
manner provided in the Fund's Declaration of Trust. Such fee shall be payable
for each calendar month as soon
as practicable after the end of that month.
The fees payable to the Adviser by the Fund pursuant to this Section 3
shall be reduced by any commissions, tender solicitation and other fees,
brokerage or similar payments received by the Adviser, or any other direct
or indirect majority owned subsidiary of Xxx Xxxxxx Investments Inc., in
connection with the purchase and sale of portfolio investments of the Fund,
less any direct expenses incurred by such person, in connection with
obtaining such commissions, fees, brokerage or similar payments. The
Adviser shall use its best efforts to recapture all available tender offer
solicitation fees and exchange offer fees in connection with the Fund's
portfolio transactions and shall advise the Trustees of any other
commissions, fees, brokerage or similar payments which may be possible for
the Adviser or any other direct or indirect majority owned subsidiary of
Xxx Xxxxxx Investments Inc. to receive in connection with Fund's portfolio
transactions or other arrangements which may benefit the Fund.
In the event that the ordinary business expenses of the Fund for any fiscal
year should exceed the most restrictive expense limitation applicable in
the states where the Fund's shares are qualified for sale, the compensation
due the Adviser for such fiscal year shall be reduced by the amount of such
excess. The Adviser's compensation shall be so reduced by a reduction or a
refund thereof, at the time such compensation is payable after the end of
each calendar months during such fiscal year of the Fund, and if such
amount should exceed such monthly compensation, the Adviser shall pay the
Fund an amount sufficient to make up the deficiency, subject to
readjustment during the Fund's fiscal year. For purposes of this paragraph,
all ordinary business expenses of the Fund shall include the investment
advisory fee and other operating expenses paid by the Fund except (i) For
interest and taxes; (ii) brokerage commissions; (iii) as a result of
litigation in connection with a suit involving a claim for recovery by the
Fund; (iv) as a result of litigation involving a defense against a
liability asserted against the Fund, provided that, if the Adviser made the
decision or took the actions which resulted in such claim, it acted in good
faith without negligence or misconduct; (v) any indemnification paid by the
Fund to its officers and trustees and the Adviser in accordance with
applicable state and federal laws as a result of such litigation; and (vi)
amounts paid to Xxx Xxxxxx Funds Inc., the distributor of the Fund's
shares, in connection with a distribution plan adopted by the Fund's
Trustees pursuant to Rule 12b-l under the Investment Company Act of 1940 as
amended from time to time.
If the Adviser shall serve for less than the whole of any month, the
foregoing compensation shall be prorated.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed as of
the day and year first above written.
XXX XXXXXX HIGH YIELD FUND XXX XXXXXX ASSET MANAGEMENT
By: /s/ Xxxxxx X. Xxxxxxx By: /s/ Xxxxxx X. Xxxx, III
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Xxxxxx X. Xxxxxxx Xxxxxx X. Xxxx, III
Executive Vice President Managing Director
and Principal Executive Officer
