Exhibit 5(e)
INVESTMENT ADVISORY AGREEMENT
AGREEMENT made as of the close of business this 5th day of October, 1996,
by and between Xxxxxxxx, Xxxx & Xxxx Master Portfolio, an unincorporated trust
organized under the laws of the State of New York (the "Portfolio Trust") and
Xxxxxxxx, Ayer & Wood, Inc., a Massachusetts corporation (the "Adviser").
W I T N E S S E T H:
WHEREAS, the Portfolio Trust is engaged in business as an open-end
management investment company and is so registered under the Investment Company
Act of 1940, as amended (the "1940 Act"); and
WHEREAS, the assets held by the Trustees of the Portfolio Trust may be
divided into separate funds, each with its own separate investment portfolio,
investment objectives, policies and purposes; and
WHEREAS, the Adviser is engaged in the business of rendering investment
advisory and management services, and is registered as an investment adviser
under the Investment Advisers Act of 1940, as amended; and
WHEREAS, the Portfolio Trust desires to retain the Adviser to furnish
investment advisory services to the Xxxxxxxx Small Capitalization Equity
Portfolio II (the "Portfolio"), a separate fund of the Portfolio Trust, and the
Adviser is willing to furnish such services;
NOW, THEREFORE, it is hereby agreed between the parties hereto as follows:
I. Appointment of the Adviser. The Portfolio Trust hereby appoints the
Adviser to act as investment adviser of the Portfolio for the period and on the
terms herein set forth. The Adviser accepts such appointment and agrees to
render the services herein set forth, for the compensation herein provided. The
Adviser shall for all purposes herein be deemed an independent contractor and
shall, unless expressly otherwise provided, have no authority to act for or
represent the Portfolio in any way nor shall otherwise be deemed an agent of the
Portfolio.
II. Duties of the Adviser. A. The Adviser, at its expense, will furnish
continuously an investment program for the Portfolio, will determine, subject to
the overall supervision and review of the Trustees of the Portfolio Trust what
investments shall be purchased, held, sold or exchanged by the Portfolio and
what portion, if any, of the assets of the Portfolio will be held uninvested,
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and shall, on behalf of the Portfolio Trust, make changes in the investments of
the Portfolio. Subject always to the supervision of the Trustees of the
Portfolio Trust and to the provisions of the Portfolio Trust's Agreement and
Declaration of Trust and Bylaws and of the 1940 Act, the Adviser will also
manage, supervise and conduct the other affairs and business of the Portfolio
and matters incidental thereto. Notwithstanding the foregoing, the Adviser shall
not be required to perform any such non-investment advisory services that may,
in the opinion of counsel to the Portfolio Trust, cause the Portfolio to be
engaged in a "trade or business within the United States", as such term is used
in Section 864 of the Internal Revenue Code of 1986, or any successor statute.
The Adviser, and any affiliate thereof, shall be free to render similar services
to other investment companies and other clients and to engage in other
activities, so long as the services rendered hereunder are not impaired.
B. The Portfolio shall bear the expenses of its operations, including legal
and auditing services, taxes and governmental fees, certain insurance premiums,
costs of notices and reports to interest-holders, typesetting and printing of
registration and financial statements for regulatory purposes and for
distribution to existing and prospective interest-holders, bookkeeping and
interest pricing expenses, fees and disbursements of the Portfolio Trust's
custodian, administrator, transfer and dividend disbursing agent or registrar,
or interest and other like expenses properly payable by the Portfolio Trust.
III. Compensation of the Adviser. A. As full compensation for the services
and facilities furnished by the Adviser under this Agreement, the Portfolio
Trust agrees to pay to the Adviser a fee equal at an annual rate to 0.60% of the
Portfolio's average daily net assets. Such fees shall be accrued when computed
and payable monthly. For purposes of calculating such fee, the Portfolio's
average daily net asset value shall be determined by taking the average of all
determinations of net asset value made in the manner provided in the Portfolio's
current prospectus and statement of additional information.
B. The compensation payable to the Adviser hereunder for any period less
than a full month during which this Agreement is in effect shall be prorated
according to the proportion which such period bears to a full month.
C. The Adviser agrees that if total expenses (excluding brokerage, taxes
and extraordinary expenses) of the Portfolio for any fiscal year of the
Portfolio exceed 1.50% of the Portfolio's average daily net assets, the
compensation due the Adviser for such fiscal year shall be proportionately
reduced by the amount of such excess by a reduction or refund thereof at the
time such compensation is payable after the end of each calendar month, subject
to readjustment during such fiscal year.
IV. Limitation of Liability of Adviser. The Adviser shall not be liable for
any error of judgment or mistake of law or for any loss suffered by the
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Portfolio Trust in connection with any investment policy or the purchase, sale
or retention of any securities on the recommendation of the Adviser; provided,
however, that nothing herein contained shall be construed to protect the Adviser
against any liability to the Portfolio Trust by reason of willful misfeasance,
bad faith or gross negligence in the performance of its duties, or by reason of
reckless disregard of its obligations and duties under this Agreement.
V. Term and Termination. A. This Agreement shall become effective on the
date hereof. Unless terminated as herein provided, this Agreement shall remain
in full force and effect for two years from the date hereof and shall continue
in full force and effect for successive periods of one year thereafter, but only
so long as each such continuance is approved annually (i) by either the Trustees
of the Portfolio Trust or by vote of a majority of the outstanding voting
securities (as defined in the 0000 Xxx) of the Portfolio, and, in either event,
(ii) by vote of a majority of the Trustees of the Portfolio Trust who are not
parties to this Agreement or "interested persons" (as defined in the 0000 Xxx)
of any such party, cast in person at a meeting called for the purpose of voting
on such approval.
B. This Agreement may be terminated at any time without the payment of any
penalty by vote of the Trustees of the Portfolio Trust or by vote of a majority
of the outstanding voting securities (as defined in the 0000 Xxx) of the
Portfolio or by the Adviser, on sixty days' written notice to the other party.
C. This Agreement shall automatically and immediately terminate in the
event of its assignment as defined in the 1940 Act.
VI. Limitation of Liability. The phrase "Xxxxxxxx, Xxxx & Xxxx Master
Portfolio" means and refers to the Trustees from time to time serving under the
Agreement and Declaration of Trust of the Portfolio Trust dated January 18,
1996, as the same may subsequently thereto have been, or subsequently hereto be,
amended. It is expressly agreed that the obligations of the Portfolio Trust
hereunder shall not be binding upon any of the Trustees, interest-holders,
nominees, officers, agents or employees of the Portfolio Trust, personally, but
shall bind only the trust property of the Portfolio Trust as provided in the
Agreement and Declaration of Trust of the Portfolio Trust. The execution and
delivery of this Agreement have been authorized by the Trustees and
interest-holders of the Portfolio and this Agreement has been signed by an
authorized officer of the Portfolio Trust, acting as such, and neither such
authorization by such Trustees and interest-holders nor such execution and
delivery by such officer shall be deemed to have been made by any of them, but
shall bind only the trust property of the Portfolio Trust as provided in the
Agreement and Declaration of Trust.
IN WITNESS WHEREOF the parties hereto have caused this Agreement to be duly
executed as of the date first written above.
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XXXXXXXX, AYER & WOOD MASTER PORTFOLIO,
on behalf of XXXXXXXX SMALL CAPITALIZATION
EQUITY PORTFOLIO II
Attest:
/s/ Xxxxxxx X. Xxxx
Xxxxxxx X. Xxxx, President
(Executed outside the United States)
XXXXXXXX, AYER & WOOD, INC.
Attest:
By:/s/ Xxxxxxx X. Xxxx
Its:Vice President
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