DELAWARE GROUP PREMIUM FUND, INC.
REIT SERIES
INVESTMENT MANAGEMENT AGREEMENT
AGREEMENT, made by and between DELAWARE GROUP PREMIUM FUND, INC.,
Maryland corporation ("Fund") on behalf of the REIT SERIES ("Series"), and
DELAWARE MANAGEMENT COMPANY, a series of Delaware Management Business Trust, a
Delaware business trust ("Investment Manager").
W I T N E S S E T H:
WHEREAS, the Fund has been organized and operates as an investment
company registered under the Investment Company Act of 1940 and is currently
comprised of 16 series, including the Series; as a separate series of the Fund,
each series engages in the business of investing and reinvesting its assets in
securities, and
WHEREAS, the Investment Manager is a registered investment adviser
under the Investment Advisers Act of 1940 and engages in the business of
providing investment management services; and
WHEREAS, in connection with the changes in investment manager, the
Fund on behalf of the Series and the Investment Manager desire to enter into
this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, and each of the parties hereto intending to be legally bound, it is
agreed as follows:
1. The Fund hereby employs the Investment Manager to manage the
investment and reinvestment of the Series' assets and to administer its affairs,
subject to the direction of the Fund's Board of Directors and officers of the
Fund for the period and on the terms hereinafter set forth. The Investment
Manager hereby accepts such employment and agrees during such period to render
the services and assume the obligations herein set forth for the compensation
herein provided. The Investment Manager shall for all purposes herein be deemed
to be an independent contractor, and shall, unless otherwise expressly provided
and authorized, have no authority to act for or represent the Fund in any way,
or in any way be deemed an agent of the Fund. The Investment Manager shall
regularly make decisions as to what securities and other instruments to purchase
and sell on behalf of the Series and shall effect the purchase and sale of such
investments in furtherance of the Series' objectives and policies and shall
furnish the Board of Directors of the Fund with such information and reports
regarding the Series' investments as the Investment Manager deems appropriate or
as the Directors of the Fund may reasonably request.
2. The Fund shall conduct its own business and affairs and shall bear
the expenses and salaries necessary and incidental thereto including, but not in
limitation of the foregoing, the costs incurred in: the maintenance of its
corporate existence; the maintenance of its own books, records and procedures;
dealing with its own shareholders; the payment of dividends; transfer of stock,
including issuance, redemption and repurchase of shares; preparation of share
certificates; reports and notices to shareholders; calling and holding of
shareholders' meetings; miscellaneous office expenses; brokerage commissions;
custodian fees; legal and accounting fees; taxes; and federal and state
registration fees. Directors, officers and employees of the Investment Manager
may be directors, officers and employees of any of the funds (including the
Fund) of which Delaware Management Company is investment manager. Directors,
officers and employees of the Investment Manager who are directors, officers
and/or
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employees of these funds shall not receive any compensation from the funds for
acting in such dual capacity.
In the conduct of the respective businesses of the parties
hereto and in the performance of this Agreement, the Fund and Investment Manager
may share facilities common to each, with appropriate proration of expenses
between them.
3. (a) Subject to the primary objective of obtaining the best
available prices and execution, the Investment Manager will place orders for the
purchase and sale of portfolio securities and other instruments with such
broker/dealers selected who provide statistical, factual and financial
information and services to the Fund, to the Investment Manager, to any
Sub-Adviser, as defined in Paragraph 5 hereof, or to any other fund for which
the Investment Manager or any such Sub-Adviser provides investment advisory
services and/or with broker/dealers who sell shares of the Fund or who sell
shares of any other fund for which the Investment Manager or any such
Sub-Adviser provides investment advisory services. Broker/dealers who sell
shares of the funds of which Delaware Management Company, Inc. is investment
manager, shall only receive orders for the purchase or sale of portfolio
securities to the extent that the placing of such orders is in compliance with
the Rules of the Securities and Exchange Commission and the National Association
of Securities Dealers, Inc.
(b) Notwithstanding the provisions of subparagraph (a) above and
subject to such policies and procedures as may be adopted by the Board of
Directors and officers of the Fund, the Investment Manager may ask the Fund and
the Fund may agree to pay a member of an exchange, broker or dealer an amount of
commission for effecting a securities transaction in excess of the amount of
commission another member of an exchange, broker or dealer would have charged
for effecting that transaction, in
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such instances where the Fund and the Investment Manager have determined in good
faith that such amount of commission was reasonable in relation to the value of
the brokerage and research services provided by such member, broker or dealer,
viewed in terms of either that particular transaction or the Investment
Manager's overall responsibilities with respect to the Fund and to other funds
and other advisory accounts for which the Investment Manager or any Sub-Adviser,
as defined in Paragraph 5 hereof, exercises investment discretion.
4. As compensation for the services to be rendered to the Fund by the
Investment Manager under the provisions of this Agreement, the Fund shall pay to
the Investment Manager monthly from the Series' assets, a fee on the average
daily net assets of the Series during the month. Such fee shall be calculated in
accordance with the following schedule:
Monthly Annual Rate Average Daily Net Assets
------- ----------- ------------------------
7.50/12 of 1% 0.750% on the first $500 million of average daily net assets
7.00/12 of 1% 0.700% on the next $500 million of average daily net assets
6.50/12 of 1% 0.650% on the next $1.5 billion of average daily net assets
6.00/12 of 1% 0.600% on the average daily net assets in excess of $2.5 billion
If this Agreement is terminated prior to the end of any
calendar month, the management fee shall be prorated for the portion of any
month in which this Agreement is in effect according to the proportion which the
number of calendar days, during which the Agreement is in effect, bears to the
number of calendar days in the month, and shall be payable within 10 days after
the date of termination.
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5. The Investment Manager may, at its expense, select and contract
with one or more investment advisers registered under the Investment Advisers
Act of 1940 (the "Sub-Adviser") to perform some or all of the services for the
Series for which it is responsible under this Agreement. The Investment Manager
will compensate any Sub-Adviser for its services to the Series. The Investment
Manager may terminate the services of any Sub-Adviser at any time in its sole
discretion, and shall at such time assume the responsibilities of such
Sub-Adviser unless and until a successor Sub-Adviser is selected and the
requisite approval of the Series' shareholders is obtained. The Investment
Manager will continue to have responsibility for all advisory services furnished
by any Sub-Adviser.
6. The services to be rendered by the Investment Manager to the Fund
under the provisions of this Agreement are not to be deemed to be exclusive, and
the Investment Manager shall be free to render similar or different services to
others so long as its ability to render the services provided for in this
Agreement shall not be impaired thereby.
7. The Investment Manager, its directors, officers, employees, agents
and shareholders may engage in other businesses, may render investment advisory
services to other investment companies, or to any other corporation,
association, firm or individual, and may render underwriting services to the
Fund or to any other investment company, corporation, association, firm or
individual.
8. In the absence of willful misfeasance, bad faith, gross
negligence, or a reckless disregard of the performance of its duties as the
Investment Manager to the Fund, the Investment Manager shall not be subject to
liability to the Fund or to any shareholder of the Fund for any action or
omission in the course of, or connected with, rendering services hereunder or
for any losses that may be sustained in the purchase, holding or sale of any
security, or otherwise.
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9. This Agreement shall be executed and become effective as of the
date written below if approved by the vote of a majority of the outstanding
voting securities of the Series. It shall continue in effect for a period of two
years and may be renewed thereafter only so long as such renewal and continuance
is specifically approved at least annually by the Board of Directors or by the
vote of a majority of the outstanding voting securities of the Series and only
if the terms and the renewal hereof have been approved by the vote of a majority
of the Directors of the Fund who are not parties hereto or interested persons of
any such party, cast in person at a meeting called for the purpose of voting on
such approval. Notwithstanding the foregoing, this Agreement may be terminated
by the Fund at any time, without the payment of a penalty, on sixty days'
written notice to the Investment Manager of the Fund's intention to do so,
pursuant to action by the Board of Directors of the Fund or pursuant to the vote
of a majority of the outstanding voting securities of the Series. The Investment
Manager may terminate this Agreement at any time, without the payment of a
penalty, on sixty days' written notice to the Fund of its intention to do so.
Upon termination of this Agreement, the obligations of all the parties hereunder
shall cease and terminate as of the date of such termination, except for any
obligation to respond for a breach of this Agreement committed prior to such
termination, and except for the obligation of the Fund to pay to the Investment
Manager the fee provided in Paragraph 4 hereof, prorated to the date of
termination. This Agreement shall automatically terminate in the event of its
assignment.
10. This Agreement shall extend to and bind the heirs, executors,
administrators and successors of the parties hereto.
11. For the purposes of this Agreement, the terms "vote of a majority
of the outstanding voting securities"; "interested persons"; and "assignment"
shall have the meaning defined in the Investment Company Act of 1940.
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IN WITNESS WHEREOF, the parties hereto have caused their corporate
seals to be affixed and duly attested and their presents to be signed by their
duly authorized officers as of the 30th day of April, 1998.
DELAWARE GROUP PREMIUM FUND, INC.
for the REIT SERIES
By: /s/Xxxxx X. Xxxxx
--------------------------
Xxxxx X. Xxxxx
Attest:
By: /s/Xxxxxxx X. Xxxxxxxxxx
--------------------------
Xxxxxxx X. Xxxxxxxxxx
Assistant Vice President/
Assistant Secretary/
Senior Counsel
DELAWARE MANAGEMENT COMPANY, a
series of DELAWARE MANAGEMENT BUSINESS TRUST
By: /s/Xxxxx X. Xxxxxx
--------------------------
Xxxxx X. Xxxxxx
Executive Vice President
Chief Operating Officer
Chief Financial Officer
Attest:
By: /s/Xxxxxxx X.Xxxxx
---------------------------
Xxxxxxx X.Xxxxx
Assistant Vice President/
Assistant Secretary/
Senior Counsel
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