Exhibit 5A
PORTFOLIO ADVISORY AGREEMENT
SELECT ADVISORS PORTFOLIOS
BALANCED PORTFOLIO
This PORTFOLIO ADVISORY AGREEMENT is made as of the ____ day of ________,
1997, by and between TOUCHSTONE ADVISORS, INC., an Ohio corporation (the
"Advisor"), and OpCap Advisors, a subsidiary of Xxxxxxxxxxx Capital
__________, a ______________ (the "Portfolio Advisor").
WHEREAS, the Advisor has been organized to operate as an investment
advisor registered under the Investment Advisers Act of 1940, as amended, and
has been retained by Select Advisors Portfolios (the "Trust"), a New York
trust organized pursuant to a Declaration of Trust dated February 7, 1994 and
registered as an open-end management investment company under the Investment
Company Act of 1940 (the "1940 Act") to provide investment advisory services
to the Balanced Portfolio (herein the "Portfolio"); and
WHEREAS, the Portfolio Advisor also is an investment advisor registered
under the Investment Advisers Act of 1940, as amended; and
WHEREAS, the Advisor desires to retain the Portfolio Advisor to furnish
it with portfolio management services in connection with the Advisor's
investment advisory activities on behalf of the Portfolio, and the Portfolio
Advisor is willing to furnish such services to the Advisor and the Portfolio;
NOW THEREFORE, in consideration of the terms and conditions hereinafter
set forth, it is agreed as follows:
1. Employment of the Portfolio Advisor. In accordance with and subject
to the Investment Advisory Agreement between the Trust and the Advisor,
attached hereto as Exhibit A (the "Advisory Agreement"), the Advisor hereby
appoints the Portfolio Advisor to manage the investment and reinvestment of
those assets of the Portfolio allocated to it by the Advisor (the "Portfolio
Assets"), subject to the control and direction of the Advisor and the Trust's
Board of Trustees, for the period and on the terms hereinafter set forth.
The Portfolio Advisor hereby accepts such employment and agrees during such
period to render the services and to perform the duties called for by this
Agreement for the compensation herein provided. The Portfolio Advisor shall
at all times maintain its registration as an investment advisor under the
Investment Advisers Act of 1940 and shall otherwise comply in all material
respects with all applicable laws and regulations, both state and federal.
The Portfolio Advisor shall for all purposes herein be deemed an independent
contractor and shall, except as expressly provided or authorized (whether
herein or otherwise), have no authority to act for or represent the Trust in
any way or otherwise be deemed an agent of the Trust or the Portfolio.
2. Duties of the Portfolio Advisor. The Portfolio Advisor will
provide the following services and undertake the following duties:
a. The Portfolio Advisor will manage the investment and
reinvestment of the assets of the Portfolio Assets, subject to and in
accordance with the investment objectives, policies and restrictions of
the Portfolio and any directions which the Advisor or the Trust's Board
of Trustees may give from time to time with respect to the Portfolio.
In furtherance of the foregoing, the Portfolio Advisor will make all
determinations with respect to the investment of the assets of the
Portfolio and the purchase and sale of portfolio securities and shall
take such steps as may be necessary or advisable to implement the same
The Portfolio Advisor also will determine the manner in which voting
rights, rights to consent to corporate action and any other rights
pertaining to the portfolio securities will be exercised. The Portfolio
Advisor will render regular reports to the Trust's Board of Trustees, to
the Advisor and to RogersCasey Consulting, Inc. (or such other advisor
or advisors as the Advisor shall engage to assist it in the evaluation
of the performance and activities of the Portfolio Advisor). Such
reports shall be made in such form and manner and with respect to such
matters regarding the Portfolio and the Portfolio Advisor as the Trust,
the Advisor or RogersCasey Consulting, Inc. shall from time to time
request.
b. The Portfolio Advisor shall provide support to the Advisor
with respect to the marketing of the Portfolio, including but not
limited to: (i) permission to use the Portfolio Advisor's name as
provided in Section 5, (ii) permission to use the past performance and
investment history of the Portfolio Advisor as the same is applicable to
the Portfolio, and (iii) access to the individual(s) responsible for
day-to-day management of the Portfolio for marketing conferences,
teleconferences and other activities involving the promotion of the
Portfolio, subject to the reasonable request of the Advisor, (iv)
permission to use biographical and historical data of the Portfolio
Advisor and individual manager(s), and (v) permission to use the names
of clients to which the Portfolio Advisor provides investment management
services, subject to any restrictions imposed by clients on the use of
such names.
c. The Portfolio Advisor will, in the name of the Portfolio, place
orders for the execution of all portfolio transactions in accordance
with the policies with respect thereto set forth in the Trust's
registration statements under the 1940 Act and the Securities Act of
1933, as such registration statements may be in effect from time to
time. In connection with the placement of orders for the execution of
portfolio transactions, the Portfolio Advisor will create and maintain
all necessary brokerage records of the Portfolio in accordance with all
applicable laws, rules and
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regulations, including but not limited to records required by Section
31(a) of the 1940 Act. All records shall be the property of the Trust
and shall be available for inspection and use by the Securities and
Exchange Commission (the "SEC"), the Trust or any person retained by the
Trust. Where applicable, such records shall be maintained by the Advisor
for the periods and in the places required by Rule 31a-2 under the 1940
Act. When placing orders with brokers and dealers, the Portfolio
Advisor's primary objective shall be to obtain the most favorable price
and execution available for the Portfolio, and in placing such orders
the Portfolio Advisor may consider a number of factors, including,
without limitation, the overall direct net economic result to the
Portfolio (including commissions, which may not be the lowest available
but ordinarily should not be higher than the generally prevailing
competitive range), the financial strength and stability of the broker,
the efficiency with which the transaction will be effected, the ability
to effect the transaction at all where a large block is involved and the
availability of the broker or dealer to stand ready to execute possibly
difficult transactions in the future. The Portfolio Advisor is
specifically authorized, to the extent authorized by law (including,
without limitation, Section 28(e) of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), to pay a broker or dealer who
provides research services to the Portfolio Advisor an amount of
commission for effecting a portfolio transaction in excess of the amount
of commission another broker or dealer would have charged for effecting
such transaction, in recognition of such additional research services
rendered by the broker or dealer, but only if the Portfolio Advisor
determines in good faith that the excess commission is reasonable in
relation to the value of the brokerage and research services provided by
such broker or dealer viewed in terms of the particular transaction or
the Portfolio Advisor's overall responsibilities with respect to
discretionary accounts that it manages, and that the Portfolio derives
or will derive a reasonably significant benefit from such research
services. The Portfolio Advisor will present a written report to the
Board of Trustees of the Trust, at least quarterly, indicating total
brokerage expenses, actual or imputed, as well as the services obtained
in consideration for such expenses, broken down by broker-dealer and
containing such information as the Board of Trustees reasonably shall
request.
d. In the event of any reorganization or other change in the
Portfolio Advisor, its investment principals, supervisors or members of
its investment (or comparable) committee, the Portfolio Advisor shall
give the Advisor and the Trust's Board of Trustees written notice of
such reorganization or change within a reasonable time (but not later
than 30 days) after such reorganization or change.
e. The Portfolio Advisor will bear its expenses of providing
services to the Portfolio pursuant to this Agreement except such
expenses as are undertaken by the Advisor or the Trust.
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f. The Portfolio Advisor will manage the Portfolio Assets and the
investment and reinvestment of such assets so as to comply with the
provisions of the 1940 Act and with Subchapter M of the Internal Revenue
Code of 1986, as amended.
3. Compensation of the Portfolio Advisor.
a. As compensation for the services to be rendered and duties
undertaken hereunder by the Portfolio Advisor, the Advisor will pay to
the Portfolio Advisor a monthly fee equal on an annual basis to 0.60% of
the first $20 million of the average daily net assets of the Combined
Portfolios, 0.50% of the average daily net assets of the Combined
Portfolios in excess of $20 million and up to $50 million; 0.40% of
the average daily net assets of the Combined Portfolios in excess of $50
million and up to $1 billion and 0.375% of the average daily net assets
of the Combined Portfolios in excess of $1 billion.
b. "Combined Portfolios," for purposes of this Section 3, means
the combined assets of the Portfolio and the Balanced Portfolio of the
Select Advisors Variable Trust, to which portfolio the Portfolio Advisor
also acts as investment advisor.
c. The fee of the Portfolio Advisor hereunder shall be computed
and accrued daily. If the Portfolio Advisor serves in such capacity for
less than the whole of any period specified in Section 3a, the fee to
the Portfolio Advisor shall be prorated. For purposes of calculating
the Portfolio Advisor's fee, the daily value of the net assets of the
Combined Portfolios shall be computed by the same method as the Trust
and the Select Advisors Variable Insurance Trust use, respectively, to
compute the net asset value of each such Portfolio for purposes of
purchases and redemptions of interests thereof.
d. The Portfolio Advisor reserves the right to waive all or a
part of its fees hereunder.
4. Activities of the Portfolio Advisor. It is understood that the
Portfolio Advisor may perform investment advisory services for various other
clients, including other investment companies. The Portfolio Advisor will
report to the Board of Trustees of the Trust (at regular quarterly meetings
and at such other times as such Board of Trustees reasonably shall request)
(i) the financial condition and prospects of the Portfolio Advisor, (ii) the
nature and amount of transactions affecting the Portfolio that involve the
Portfolio Advisor and affiliates of the Portfolio Advisor, (iii) information
regarding any potential conflicts of interest arising by reason of its
continuing provision of advisory
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services to the Portfolio and to its other accounts, and (iv) such other
information as the Board of Trustees shall reasonably request regarding the
Portfolio, the Portfolio's performance, the services provided by the
Portfolio Advisor to the Portfolio as compared to its other accounts and the
plans of, and the capability of, the Portfolio Advisor with respect to
providing future services to the Portfolio and its other accounts. At least
annually, the Portfolio Advisor shall report to the Trustees the total number
and type of such other accounts and the approximate total asset value thereof
(but not the identities of the beneficial owners of such accounts). The
Portfolio Advisor agrees to submit to the Trust a statement defining its
policies with respect to the allocation of business among the Portfolio and
its other clients.
It is understood that the Portfolio Advisor may become interested in
the Trust as an interest holder or otherwise.
The Portfolio Advisor has supplied to the Advisor and the Trust copies of
its Form ADV with all exhibits and attachments thereto (including the
Portfolio Advisor's statement of financial condition) and will hereafter
supply to the Advisor, promptly upon the preparation thereof, copies of all
amendments or restatements of such document.
5. Use of Names. Neither the Advisor nor the Trust shall use the name
of the Portfolio Advisor in any prospectus, sales literature or other
material relating to the Advisor or the Trust in any manner not approved in
advance by the Portfolio Advisor; provided, however, that the Portfolio
Advisor will approve all uses of its name which merely refer in accurate
terms to its appointment hereunder or which are required by the SEC or a
state securities commission; and provided further, that in no event shall
such approval be unreasonably withheld. The Portfolio Advisor shall not use
the name of the Advisor or the Trust in any material relating to the
Portfolio Advisor in any manner not approved in advance by the Advisor or the
Trust, as the case may be; provided, however, that the Advisor and the Trust
shall each approve all uses of their respective names which merely refer in
accurate terms to the appointment of the Portfolio Advisor hereunder or which
are required by the SEC or a state securities commission; and, provided
further, that in no event shall such approval be unreasonably withheld.
6. Limitation of Liability of the Portfolio Advisor. Absent willful
misfeasance, bad faith, gross negligence, or reckless disregard of
obligations or duties hereunder on the part of the Portfolio Advisor, the
Portfolio Advisor shall not be subject to liability to the Advisor, the Trust
or to any holder of an interest in the Portfolio for any act 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. As used in this Section 6, the term "Portfolio Advisor" shall
include the Portfolio Advisor and/or any of
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its affiliates and the directors, officers and employees of the
Portfolio Advisor and/or any of its affiliates.
7. Limitation of Trust's Liability. The Portfolio Advisor
acknowledges that it has received notice of and accepts the limitations upon
the Trust's liability set forth in its Declaration of Trust. The Portfolio
Advisor agrees that (i) the Trust's obligations to the Portfolio Advisor
under this Agreement (or indirectly under the Advisory Agreement) shall be
limited, in any event to the assets of the Portfolio and (ii) the Portfolio
Advisor shall not seek satisfaction of any such obligation from the holders
of interests in the Portfolio nor from any Trustee, officer, employee or
agent of the Trust.
8. Force Majeure. The Portfolio Advisor shall not be liable for delays
or errors occurring by reason of circumstances beyond its control, including
but not limited to acts of civil or military authority, national emergencies,
work stoppages, fire, flood, catastrophe, acts of God, insurrection, war,
riot, or failure of communication or power supply. In the event of equipment
breakdowns beyond its control, the Portfolio Advisor shall take reasonable
steps to minimize service interruptions but shall have no liability with
respect thereto.
9. Renewal, Termination and Amendment.
a. This Agreement shall continue in effect, unless sooner
terminated as hereinafter provided, for a period of 12 months from the
date hereof; and it shall continue thereafter provided that such
continuance is specifically approved by the parties and, in addition, at
least annually by (i) the vote of the holders of a majority of the
outstanding voting securities (as herein defined) of the Portfolio or by
vote of a majority of the Trust's Board of Trustees and (ii) by the vote
of a majority of the Trustees who are not parties to this Agreement or
interested persons of either the Advisor or the Portfolio Advisor, 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 payment
of any penalty, (i) by the Advisor, by the Trust's Board of Trustees or
by a vote of the majority of the outstanding voting securities of the
Portfolio, in any such case upon not less than 60 days' prior written
notice to the Portfolio Advisor and (ii) by the Portfolio Advisor upon
not less than 60 days' prior written notice to the Advisor and the
Trust. This Agreement shall terminate automatically in the event of its
assignment.
c. This Agreement may be amended at any time by the parties
hereto, subject to approval by the Trust's Board of Trustees and, if
required by applicable
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SEC rules and regulations, a vote of the majority of the outstanding
voting securities of the Portfolio affected by such change.
d. The terms "assignment," "interested persons" and "majority" of
the outstanding voting securities" shall have the meaning set forth for
such terms in the 1940 Act.
10. Severability. If any provision of this Agreement shall become or
shall be found to be invalid by a court decision, statute, rule or otherwise,
the remainder of this Agreement shall not be affected thereby.
11. Notice. Any notices under this Agreement shall be in writing
addressed and delivered personally (or by telecopy) or mailed postage-paid,
to the other party at such address as such other party may designate in
accordance with this paragraph for the receipt of such notice. Until further
notice to the other party, it is agreed that the address of the Trust and
that of the Advisor for this purpose shall be 000 Xxxx Xxxxxx, Xxxxxxxxxx,
Xxxx 00000 and that the address of the Portfolio Advisor shall be
_______________, _________________.
12. Miscellaneous. Each party agrees to perform such further actions and
execute such further documents as are necessary to effectuate the purposes
hereof. This Agreement shall be construed and enforced in accordance with and
governed by the laws of the State of Ohio. The captions in this Agreement
are included for convenience only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect.
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.
TOUCHSTONE ADVISORS, INC.
BY _____________________________
Xxxxxx X. Xxxxxxx, Xx.
President
Attest:
_________________________
Secretary
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XXXXXXXXXXX XXXXXXX _____________
BY _____________________________
Name, President
Attest:
_________________________
Secretary
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