EXHIBIT 23(d)(1)
XXXXX INTERNATIONAL SERIES, INC.
INVESTMENT ADVISORY AGREEMENT
JANUARY 1, 2001
Xxxxx Selected Advisers, L.P.
0000 X. Xxxxxx Xxxx, Xxxxx 000
Xxxxxx, Xxxxxxx 00000
Dear Sirs:
We herewith confirm our agreement with you as follows:
1. Management. We desire to employ the capital of Xxxxx International Series,
Inc. (the "Company") by investing and reinvesting the same in securities of
the type and in accordance with the limitations specified in the
registration statement under the Securities Act of 1933 and the Investment
Company Act of 1940 (the "1940 Act"), of which we enclose a copy, and in
such manner and to such extent as may from time to time be approved by our
Board of Directors. We desire to employ you to supervise and assist in the
management of this business for us. You shall for all purposes herein be
deemed an independent contractor, and shall, unless otherwise expressly
provided for or authorized, have no authority to act or represent us.
2. Officers, Directors, Employees. In this connection it is understood that
you will from time to time employ or associate with yourselves such person
or persons as you may believe to be particularly fitted to assist you in
the execution of this Agreement, it being understood that the compensation
of such person or persons shall be paid by you and that no obligation may
be incurred on our behalf in any such respect. This does not apply to such
individuals as we may in due course elect as officers of our corporation,
except that no officer, director, stockholder or employee of your firm
shall receive compensation from us for acting as director, officer or
employee of our corporation, and you agree to pay the compensation of all
such persons. We understand that, during the continuance of this agreement,
officers of your firm will, if elected, serve as directors of our
corporation and as its principal officers.
3. Authority, Reporting. You are to have complete and exclusive authority to
develop and handle for us any business of the type above mentioned which
you may consider advantageous for us, subject to the direction and control
of our officers and directors. You will furnish us with such statistical
information with respect to the securities which we may hold or contemplate
purchasing as we may request. We wish to be kept in touch with important
developments affecting our Company and shall expect you on your own
initiative to furnish us from time to time with such information as you may
believe appropriate for this purpose, whether concerning the individual
companies whose securities are included in our portfolio or the industries
in which they are engaged. We shall also expect you of your own motion to
advise us whenever in your opinion conditions are such as to make it
desirable that a specific security be eliminated from our portfolio.
4. Standard of Care. We shall expect of you your best judgment in rendering
these services to us, and we agree as an inducement to your undertaking the
same that you shall not be liable hereunder for any mistake of judgment or
in any other event whatsoever, except for lack of good faith, provided that
nothing herein shall be deemed to protect or purport to protect you against
any liability to us or to our security holders to which you would otherwise
be subject 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. Expenses. Except as otherwise provided below in this paragraph, you will
attend to, or arrange for the performance, at your expense, of such
clerical and accounting work related to the investment and reinvestment of
our capital for us as we may specify. We shall, however, bear all costs and
expenses of or attendant upon: (i) preparation of our federal, state and
local tax returns; (ii) preparation of documents we must file with the
Securities and Exchange Commission; (iii) determination of the status and
payment of dividends; (iv) reconciling and reviewing output of our
custodian bank, determining the adequacy of various accruals, approving our
expenses, authorizing our bank to receive and disburse money and securities
and verifications related thereto, and interfacing with our auditors; (v)
verification of our security ledger and preparation and maintenance of
other corporate books and records; (vi) brokerage commissions and other
transaction expenses; (vii) stockholders' and Directors' meetings; (viii)
corporate reports and proxy materials, including their preparation,
printing and distribution; (ix) fees of Directors not affiliated with you
or any other firm acting as an investment adviser to us; (x) taxes and
interest expenses; (xi) reports to government authorities including all
expenses and costs relating to such reports and to state securities law
compliance; (xii) custodian and transfer agent fees; (xiii) association
membership dues; (xiv) premiums on all insurance and bonds maintained for
us or on our behalf; (xv) retention of the transfer agent and registrar for
our shares and the disbursing agent for our stockholders, including costs
and expenses attendant upon shareholder servicing, purchase, repurchase and
redemption of our shares; (xvi) our counsel; and (xvii) our independent
auditors. We may arrange for you to provide some or all of the services
relating to items (i) to (xvi) above, and any other services not directly
relating to investment and reinvestment of our capital, upon such terms and
conditions, including compensation, as we may agree and subject to the
approval and review of our Board of Directors.
6. Fees. In consideration of such services, we shall pay you a monthly fee as
of the last day of each month in each year based upon the average daily
value of net assets during a month for which the monthly fee is calculated,
as follows:
MONTHLY RATE VALUE OF AVERAGE DAILY NET ASSETS OF THE XXXXX INTERNATIONAL
TOTAL RETURN FUND DURING THE MONTH
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1/12 of 1.00% of First $250 Million
1/12 of .90% of Next $250 Million
1/12 of .80% of Amounts In Excess of $500 Million
provided, however, that such fee for any period which shall not be a full
monthly period shall be prorated according to the proportion which such period
bears to the full month and no payment of any fee shall be made before the
commencement of the public offering of any common stock. For this purpose, the
value of our net assets shall be computed in the same manner as the value of
such net assets are computed in connection with the determination of the net
asset value of our shares.
7. Portfolio Transactions.
(a) You are authorized to place purchase and sale orders for our portfolio
transactions with brokers and/or dealers which, in your best judgment
are able to achieve "best execution" of such orders. "Best execution"
shall mean prompt and reliable execution at the most favorable security
price obtainable, taking into account research and other services
available and the reasonableness of commission charges. Purchases and
sales of securities not listed or traded on a securities exchange shall
ordinarily be executed with primary market makers, acting as principal,
except where, in your judgment, better prices and execution may
otherwise be obtained.
(b) You are authorized to allocate brokerage and principal business to
members of securities exchanges, brokers and dealers (such members,
brokers and dealers being hereinafter referred to as "brokers") who
have provided brokerage and research services, as such services are
defined in Section 28(e) of the Securities Exchange Act of 1934 (the
"1934 Act") for us and/or other accounts, if any, for which you
exercise investment discretion (as defined in Section 3(a)(35) of the
0000 Xxx) and to cause us to pay a commission for effecting a
securities transaction in excess
2
of the amount another broker would have charged for effecting that
transaction if you determine in good faith that such amount of
commission is reasonable in relation to the value of the brokerage
and research services provided by such broker, viewed in terms of
either that particular transaction or your overall responsibilities
with respect to us and the other accounts, if any, as to which you
exercise investment discretion. In reaching such determination, you
will not be required to place or attempt to place a specific dollar
value on the research or execution services of a broker or on the
portion of any commission reflecting either of said services.
(c) Portfolio transactions may be allocated to any broker or dealer taking
into account the sale by such broker or dealer of our shares. Any such
allocation shall be made in accordance with the provisions of this
agreement relating to obtaining "best execution."
8. Non-Exclusive, Use of "Xxxxx" Name. You may act as investment adviser for
any other person, firm or corporation. We recognize that you have given us
the right to use the name "Xxxxx" in our corporate title. If for any reason
you no longer act as our investment adviser, we shall remove the name
"Xxxxx" from our corporate title upon demand made by you.
9. Term and Termination. This Agreement shall become effective for an initial
period of not more than two years from its effective date, and shall
continue in full force and effect continuously there-after, if its
continuance is approved at least annually as required by the Investment
Company Act of 1940. The effective date of this Agreement shall be the
later of (i) January 1, 2001, or (ii) the date this Agreement has been
approved as required by the Investment Company Act of 1940. As of such
effective date, this Agreement shall supersede all prior investment
advisory agreements between the parties. This Agreement may be terminated
at any time, without the payment of any penalty, by our Board of Directors
or by vote of a majority of our outstanding voting securities (as defined
in the 1940 Act) on 60 days' written notice to you, or by you on 60 days'
written notice to us, and it shall be automatically terminated in the
event of its assignment (as defined in said Act).
10. Series of Shares. As of the date of this Agreement, the Company has only
one series of shares offered to the public (the "Xxxxx International Total
Return Fund") and this Agreement shall apply to that series. In the event
that the Company shall create future series, this Agreement shall apply to
and be effective as to each such series, provided (i) that as to any
additional series there may be a different fee payable to you, and (ii)
this Agreement, as amended to reflect any change in fees, is approved as
required by the 1940 Act. The effective date of this Agreement as to each
such series shall be the date that it is so approved or any later date as
shall be agreed to by you and the Company.
If the foregoing is in accordance with your understanding, will you so kindly
indicate by signing and returning to us the enclosed copy hereof.
Very truly yours,
XXXXX INTERNATIONAL SERIES, INC.
By:
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Its:
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Accepted as of the day and year first above written.
XXXXX SELECTED ADVISERS, L.P.
By: XXXXX INVESTMENTS, LLC., General Partner
By:
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Its:
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