Exhibit (d)(I)(e)
ECLIPSE FUNDS INC.
MAINSTAY FLOATING RATE FUND
FORM OF MANAGEMENT AGREEMENT
Agreement, made as of the th day of April, 2004 between Eclipse Funds Inc.,
a Maryland corporation (the "Company"), on behalf of the MainStay Floating Rate
Fund (the "Fund") a separate series of the Company, and New York Life Investment
Management LLC, a Delaware limited liability company ("NYLIM" or the "Manager").
W I T N E S S E T H:
WHEREAS, the Company is an open-end management investment company
registered under the Investment Company Act of 1940, as amended (the "1940
Act");
WHEREAS, the shares of common stock of the Company (the "Shares") are
divided into separate series, each of which is established by resolution of the
Board of Directors of the Company and the Directors may from time to time
terminate such series or establish and terminate additional series; and
WHEREAS, the Fund desires to retain the Manager to render investment
advisory and related administrative services to the Fund, and the Manager is
willing to render such services on the terms and conditions hereinafter set
forth;
NOW, THEREFORE, the parties agree as follows:
1. Appointment. The Fund hereby appoints NYLIM to act as manager to the
Fund for the period and on the terms set forth in this Agreement. NYLIM accepts
such appointment and agrees to render the services herein described, for the
compensation herein provided.
2. Duties as Manager. Subject to the supervision of the Directors of the
Company, the Manager shall administer the Fund's business affairs and manage the
investment operations of the Fund and the composition of the portfolio of the
Fund, including the purchase, retention and disposition thereof, in accordance
with the investment objectives, policies and restrictions of the Fund, as stated
in the currently effective Prospectus (as hereinafter defined) and subject to
the following understandings:
(a) The Manager shall (i) furnish the Fund with office facilities; (ii) be
responsible for the financial and accounting records required to be
maintained by the Fund (excluding those being maintained by the Fund's
Custodian and Transfer Agent except as to which the Manager has
supervisory functions) and other than those being maintained by the
Fund's subadviser, if any; and (iii) furnish the Fund with ordinary
clerical, bookkeeping and recordkeeping services at such office
facilities.
(b) The Manager shall provide supervision of the Fund's investments and
determine from time to time what investments or securities will be
purchased, retained, sold or lent by the Fund, and what portion of the
Fund's assets will be invested or held uninvested as cash.
(c) The Manager shall use its best judgment in the performance of its
duties under this Agreement.
(d) The Manager, in the performance of its duties and obligations under
this Agreement, shall act in conformity with the Articles of
Incorporation, By-Laws and Prospectus (each as hereinafter defined) of
the Company and with the instructions and directions of the Directors
of the Company and will conform to and comply with the requirements of
the 1940 Act and all other applicable federal and state laws and
regulations.
(e) The Manager, and any sub-adviser to whom such authority has been
delegated, shall determine the securities to be purchased or sold by
the Fund and will place orders pursuant to its determination with or
through such persons, brokers or dealers (including NYLIFE Securities
Inc.) in conformity with the policy with respect to brokerage as set
forth in the Company's Registration Statement and Prospectus (each as
hereinafter defined) or as the Directors may direct from time to time.
It is recognized that, in providing a Fund with investment supervision
or the placing of orders for portfolio transactions, the Manager or any
sub-adviser will give primary consideration to securing the most
favorable price and efficient execution. Consistent with this policy,
the Manager or any sub-adviser may consider the financial
responsibility, research and investment information and other services
provided by brokers or dealers who may effect or be a party to any such
transaction or other transactions to which other clients of the Manager
or any sub-adviser may be a party. It is understood that neither the
Fund, the Company nor the Manager or sub-adviser has adopted a formula
for allocation of a Fund's investment transaction business. It is also
understood that it is desirable for the Fund that the Manager or any
sub-adviser have access to supplemental investment and market research
and security and economic analyses provided by certain brokers who may
execute brokerage transactions at a higher cost to a Fund than may
result when allocating brokerage to other brokers on the basis of
seeking the most favorable price and efficient execution. Therefore,
the Manager or any sub-adviser is authorized to place orders for the
purchase and sale of securities for a Fund with such certain brokers,
subject to review by the Company's Directors from time to time with
respect to the extent and continuation of this practice. It is
understood that the services provided by such brokers may be useful to
the Manager or any sub-adviser in connection with its services to other
clients.
On occasions when the Manager or any sub-adviser deems the purchase or
sale of a security to be in the best interest of a Fund as well as
other clients, the Manager or any subadviser, to the extent permitted
by applicable laws and regulations, may, but shall be under no
obligation to, aggregate the securities to be so sold or purchased in
order to obtain the most favorable price or lower brokerage commissions
and efficient execution.
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In such event, allocation of the securities so purchased or sold, as
well as expenses incurred in the transaction, will be made by the
Manager or any sub-adviser in the manner it considers to be the most
equitable and consistent with its fiduciary obligations to that Fund
and to such other clients.
(f) The Manager shall maintain all books and records with respect to the
Fund's securities transactions required by sub-paragraphs (b)(5), (6),
(9) and (10) and paragraph (f) of Rule 31a-1 under the 1940 Act and any
other books and records required to be maintained by it under the 1940
Act and the Rules thereunder and shall render to the Company's
Directors such periodic and special reports as the Directors may
reasonably request.
(g) The Manager shall provide the Company's Custodian on each business day
with information relating to the execution of all portfolio
transactions pursuant to standing instructions.
(h) With respect to any or all series of the Company, including the Fund,
the Manager may enter into one or more contracts ("Sub-Advisory or
Sub-Administration Contract") with a sub-adviser or sub-administrator
in which the Manager delegates to such sub-adviser or sub-administrator
any or all its duties specified in this Agreement, provided that each
Sub-Advisory or Sub-Administration Contract meets all requirements of
the 1940 Act and rules thereunder.
3. Manager Personnel. The Manager shall authorize and permit any of its
directors, officers and employees who may be elected or appointed as Directors
or officers of the Company to serve in the capacities in which they are elected
or appointed. Services to be furnished by the Manager under this Agreement may
be furnished through the medium of any of such directors, officers or employees.
4. Books and Records. The Manager shall keep the Fund's books and records
required to be maintained by it, pursuant to paragraph 2 hereof. The Manager
agrees that all records which it maintains for a Fund are the property of that
Fund, and it will surrender promptly to that Fund any of such records upon the
Fund's request. The Manager further agrees to preserve for the periods
prescribed by Rule 31a-2 as promulgated by the Securities and Exchange
Commission (the "Commission") under the 1940 Act any such records as are
required to be maintained by the Manager pursuant to paragraph 2 hereof.
5. Services Not Exclusive. The services furnished by the Manager hereunder
are not to be deemed exclusive and the Manager shall be free to furnish similar
services to others so long as its services under this Agreement are not impaired
thereby.
6. Documents. The Company has delivered to the Manager copies of each of
the following documents and will deliver to it all future amendments and
supplements, if any:
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(a) Articles of Incorporation of the Company, filed with the Maryland
Department of Assessments and Taxation (such Articles of Incorporation,
as in effect on the date hereof and as amended from time to time, are
herein called the "Articles of Incorporation");
(b) By-Laws of the Company (such By-Laws, as in effect on the date hereof
and as amended from time to time, are herein called the "By-Laws");
(c) Certified Resolutions of the Directors of the Company authorizing the
appointment of the Manager and approving the form of this Agreement;
(d) Registration Statement under the 1940 Act and the Securities Act of
1933, as amended, on Form N-lA (the "Registration Statement"), as filed
with the Commission, relating to the Fund and the Fund's Shares and all
amendments thereto;
(e) Notification of Registration of the Company under the 1940 Act on Form
N-8A as filed with the Commission and all amendments thereto; and
(f) Each form of Prospectus and Statement of Additional Information of the
Company (such Prospectuses and Statement of Additional Information, as
currently in effect and as amended or supplemented from time to time,
being herein called collectively the "Prospectus").
7. Expenses.
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(a) In connection with the services rendered by the Manager under this
Agreement, the Manager will bear all of the following expenses:
(i) the salaries and expenses of all personnel of the Company and
the Manager, except the fees and expenses of Directors who are
not interested persons of the Manager or of the Company, and
(ii) all expenses incurred by the Manager in connection with the
investment operations of the Fund and administering the
ordinary course of the Fund's business, other than those
assumed by the Fund herein;
(b) The Fund assumes and will pay its expenses, including but not limited
to those described below (where any such category applies to more than
one series of the Company, the Fund shall be liable only for its
allocable portion of the expenses):
(i) the fees and expenses of Directors who are not interested
persons of the Manager or of the Company;
(ii) the fees and expenses of the Fund's custodian which relate to
(A) the custodial function and the recordkeeping connected
therewith, (B) the maintenance of the
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required accounting records of the Fund not being maintained
by the Manager, (C) the pricing of the Fund's Shares,
including the cost of any pricing service or services which
may be retained pursuant to the authorization of the Directors
of the Company, and (D) for both mail and wire orders, the
cashiering function in connection with the issuance and
redemption of the Fund's Shares;
(iii) the fees and expenses of the Company's transfer and dividend
disbursing agent, which may be the custodian, which relate to
the maintenance of each shareholder account,
(iv) the charges and expenses of legal counsel and independent
accountants for the Company;
(v) brokers' commissions and any issue or transfer taxes
chargeable to the Company in connection with its securities
transactions on behalf of the Fund;
(vi) all taxes and business fees payable by the Company or the Fund
to federal, state or other governmental agencies;
(vii) the fees of any trade association of which the Company may be
a member;
(viii) the cost of share certificates representing Fund Shares;
(ix) the fees and expenses involved in registering and maintaining
registrations of the Company and of its Shares with the
Commission, registering the Company as a broker or dealer and
qualifying its Shares under state securities laws, including
the preparation and printing of the Company's registration
statements and prospectuses for filing under federal and state
securities laws for such purposes;
(x) allocable communications expenses with respect to investor
services and all expenses of shareholders' and Directors'
meetings and of preparing printing and mailing reports to
shareholders in the amount necessary for distribution to the
shareholders;
(xi) litigation and indemnification expenses and other
extraordinary expenses not incurred in the ordinary course of
the Company's business; and
(xii) any expenses assumed by the Fund pursuant to a Plan of
Distribution adopted in conformity with Rule 12b-1 under the
1940 Act.
(c) Fees and expenses of legal counsel, registering shares, holding
meetings and communicating with shareholders as described in
subparagraph (b) above include an allocable portion of the cost of
maintaining an internal legal and compliance department.
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8. Organization Expenses. The Fund hereby agrees to reimburse the Manager
for the organization expenses of, and the expenses incurred in
connection with, the initial offering of any Shares of the Fund.
9. Compensation. For the services provided and the facilities furnished
pursuant to this Agreement, the Company will pay to the Manager as full
compensation therefor a fee at an annual rate of the following
percentage of the average daily net assets of the Fund.
Floating Rate Fund 0.60%
This fee will be computed daily and will be paid to the Manager
monthly. This fee will be chargeable only to the respective Fund, and no other
series of the Company shall be liable for the fee due and payable hereunder. No
Fund shall not be liable for any expense of any other series of the Company.
10. Standard of Care. Subject to applicable law, the Manager shall not be
liable for any error of judgment or for any loss suffered by a Fund in
connection with the matters to which this Agreement relates, except a loss
resulting from willful misfeasance, bad faith or gross negligence on its part in
the performance of its duties or from reckless disregard by it of its
obligations and duties under this Agreement.
11. Duration and Termination. This Agreement shall continue in effect with
respect to the Fund for a period of more than two years from the date hereof
only so long as such continuance is specifically approved at least annually with
respect to the Fund in conformity with the requirements of the 1940 Act and the
Rules thereunder, provided, however, that this Agreement may be terminated with
respect to any Fund at any time, without the payment of any penalty, by the
Directors of the Company or by vote of a majority of the outstanding voting
securities (as defined in the 0000 Xxx) of that Fund, or by the Manager at any
time, without the payment of any penalty, on not more than 60 days' nor less
than 30 days' written notice to the other party. This Agreement shall terminate
automatically in the event of its assignment (as defined in the 1940 Act).
12. Other Business. Nothing in this Agreement shall limit or restrict the
right of any of the Managers directors, officers, or employees who may also be a
Director, officer, or employee of the Company to engage in any other business or
to devote his time and attention in part to the management or other aspects of
any business, whether of a similar or dissimilar nature, nor limit or restrict
the Manager's right to engage in any other business or to render services of any
kind to any other corporation, trust, firm, individual or association.
13. Independent Contractor. Except as otherwise provided herein or
authorized by the Directors of the Company from time to time, the Manager shall
for all purposes herein be deemed to be an independent contractor and shall have
no authority to act for or represent any Fund or the Company in any way or
otherwise be deemed an agent of any Fund or the Company.
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14. Company Materials. During the term of this Agreement, the Company
agrees to furnish the Manager at its principal office all Prospectuses, proxy
statements, reports to shareholders, sales literature or other material prepared
for distribution to shareholders of the Fund or to the public, which refer to
the Manager in any way, prior to use thereof and not to use such material if the
Manager reasonably objects in writing within five business days (or such other
time as may be mutually agreed) after receipt thereof. In the event of
termination of this Agreement, the Company will continue to furnish to the
Manager copies of any of the above-mentioned materials which refer in any way to
the Manager. The Company shall furnish or otherwise make available to the
Manager such other information relating to the business affairs of the Fund as
the Manager at any time, or from time to time, reasonably requests in order to
discharge its obligations hereunder.
15. Amendment. This Agreement may be amended in writing by mutual consent,
but the consent of the Fund, if required, must be obtained in conformity with
the requirements of the 1940 Act and the Rules thereunder.
16. Notice. Any notice or other communication required to be given pursuant
to this Agreement shall be deemed duly given if delivered or mailed by
registered mail, postage prepaid, (1) to the Manager at 000 Xxxxxxxxxx Xxx.,
Xxxxxxxxxx, Xxx Xxxxxx 00000; or (2) to the Company at 00 Xxxxxxx Xxxxxx, Xxx
Xxxx, XX 00000.
17. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.
18. Use of Name. The Fund may use any name including the word "MainStay"
only for so long as this Agreement or any other investment advisory agreement
between the Manager or any other affiliate of New York Life Insurance Company
and the Company or any extension, renewal or amendment thereof remains in
effect, including any similar agreement with any organization which shall have
succeeded to the Manager's business as investment adviser. At such time as such
an agreement shall no longer be in effect, the respective Fund will (to the
extent that it lawfully can) cease to use such name or any other name indicating
that it is advised by or otherwise connected with the Manager or any
organization which shall have so succeeded to its business.
19. Miscellaneous. The captions in this Agreement are included for
convenience of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect. If any
provision of this Agreement shall be held or made invalid by a court decision,
statute, rule or otherwise, the remainder of this Agreement shall not be
affected thereby. As used in this Agreement, terms shall have the same meaning
as such terms have in the 1940 Act. Where the effect of a requirement of the
federal securities laws reflected in any provision of this Agreement is made
less restrictive by a rule, regulation or order of the Commission, whether of
special or general application, such provision shall be deemed to incorporate
the effect of such rule, regulation or order. This Agreement may be signed in
counterpart.
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IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed by their officers designated below as of the day and year first above
written.
ECLIPSE FUNDS INC., on behalf of the Fund
By:
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Name:
Title:
NEW YORK LIFE INVESTMENT MANAGEMENT LLC
By:
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Name:
Title
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