THE BENCHMARK FUNDS
ADDENDUM NO. 1 TO THE INVESTMENT ADVISORY AGREEMENT
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This Addendum, dated as of the 31st day of March, 1998, is entered
into between THE BENCHMARK FUNDS (the "Trust"), a Delaware business trust, and
THE NORTHERN TRUST COMPANY (the "Investment Adviser"), an Illinois state bank.
WHEREAS, the Trust and the Investment Adviser have entered into an
Investment Advisory Agreement of even date herewith (the "Advisory Agreement"),
pursuant to which the Trust appointed the Investment Adviser to act as
investment adviser to the Trust for the Diversified Assets Portfolio, Government
Portfolio, Government Select Portfolio and Tax-Exempt Portfolio;
WHEREAS, Section 1(b) of the Advisory Agreement provides that in the
event the Trust establishes one or more additional investment portfolios with
respect to which it desires to retain the Investment Adviser to act as
investment adviser under the Advisory Agreement, the Trust shall so notify the
Investment Adviser in writing and if the Investment Adviser is willing to render
such services it shall notify the Trust in writing, and the compensation to be
paid to the Investment Adviser shall be that which is agreed to in writing by
the Trust and the Investment Adviser; and
WHEREAS, pursuant to Section 1(b) of the Advisory Agreement, the Trust
has notified the Investment Adviser that it has established the Equity Index
Portfolio, Small Company Index Portfolio, Diversified Growth Portfolio, Focused
Growth Portfolio, U.S. Treasury Index Portfolio, U.S. Government Securities
Portfolio, Short-Intermediate Bond Portfolio, and Bond Portfolio (the
"Portfolios"), and that it desires to retain the Investment Adviser to act as
the investment adviser therefor, and the Investment Adviser has notified the
Trust that it is willing to serve as investment adviser for the Portfolios;
NOW THEREFORE, the parties hereto, intending to be legally bound,
hereby agree as follows:
1. Appointment. The Trust hereby appoints the Investment Adviser to
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act as investment adviser to the Trust for the Portfolios for the
period and on the terms set forth in the Advisory Agreement. The
Investment Adviser hereby accepts such appointment and agrees to
render the services set forth in the Advisory Agreement for the
compensation herein provided.
2. Duties. The Investment Adviser shall perform the following
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duties with respect to the Equity Index
Portfolio, Small Company Index Portfolio, Diversified Growth
Portfolio and Focused Growth Portfolio in lieu of clauses (ii)
and (iii) of paragraph 3(a) of the Advisory Agreement:
(a) The Investment Adviser shall place orders pursuant to
its determination either directly with the issuer or with any
broker and/or dealer or other persons who deal in the securities
in which the Portfolio in question is trading. In executing
portfolio transactions and selecting brokers or dealers with
respect to common and preferred stocks, the Investment Adviser
shall use its best judgment to obtain the best overall terms
available. In assessing the best overall terms available for any
transaction, the Adviser shall consider all factors it deems
relevant, including the breadth of the market in the security,
the price of the security, the financial condition and execution
capability of the broker or dealer, and the reasonableness of the
commission, if any, both for the specific transaction and on a
continuing basis. In evaluating the best overall terms available
and in selecting the broker or dealer to execute a particular
transaction, the Adviser may also consider the brokerage and
research services (as those terms are defined in Section 28(e) of
the Securities Exchange Act of 1934) provided to any Portfolio
and/or other accounts over which the Adviser and/or an affiliate
of the Adviser exercises investment discretion;
(b) The Investment Adviser may, on occasions when it deems
the purchase or sale of a security to be in the best interests of
a Portfolio as well as other fiduciary or agency accounts managed
by the Investment Adviser, aggregate, to the extent permitted by
applicable laws and regulations, the securities to be sold or
purchased in order to obtain best overall terms available
execution. In such event, allocation of the securities so
purchased or sold, as well as the expenses incurred in the
transaction, will be made by the Investment Adviser in the manner
it considers to be most equitable and consistent with its
fiduciary obligations to such Portfolio and to such other
accounts.
3. Compensation. For the services provided and the expenses assumed
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pursuant to the Advisory Agreement, the Trust will pay the
Investment Adviser, and the Investment Adviser will accept as
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full compensation therefor from the Trust, a fee at an annual
rate of .30 of 1% of the Equity Index Portfolio's average net
assets, .40 of 1% of the Small Company Index Portfolio's average
net assets, .80 of 1% of the Diversified Growth Portfolio's
average net assets, 1.10% of the Focused Growth Portfolio's
average net assets, .40 of 1% of the U.S. Treasury Index
Portfolio's average net assets, .60 of 1% of the U.S. Government
Securities Portfolio's average net assets, .60 of 1% of the
Short-Intermediate Bond Portfolio's average net assets, and .60
of 1% of the Bond Portfolio's average net assets. The fee will
be computed based on net assets on each day and will be paid to
the Investment Adviser monthly. Such fee as is attributable to
each Portfolio shall be a separate charge to such Portfolio and
shall be the several (and not joint or joint and several)
obligation of each such Portfolio.
4. Capitalized Terms. From and after the date hereof, the term
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"Portfolios" as used in the Advisory Agreement shall be deemed to
include the Equity Index Portfolio, Small Company Index
Portfolio, Diversified Growth Portfolio, Focused Growth
Portfolio, U.S. Treasury Index Portfolio, U.S. Government
Securities Portfolio, Short-Intermediate Bond Portfolio and Bond
Portfolio. Capitalized terms used herein and not otherwise
defined shall have the meanings ascribed to them in the Advisory
Agreement.
5. Miscellaneous. Except to the extent supplemented hereby, the
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Advisory Agreement shall remain unchanged and in full force and
effect, and is hereby ratified and confirmed in all respects as
supplemented hereby.
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IN WITNESS WHEREOF, the undersigned have executed this Addendum as of
the date and year first above written.
ATTEST: THE BENCHMARK FUNDS
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By: /s/ Xxxxx X. Xxxxxx
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Name: Xxxxx X. Xxxxxx
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Title: Vice President
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ATTEST: ---------------- THE NORTHERN TRUST COMPANY
By: /s/ Xxxxxx X. Xxxxxxx
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Name: Xxxxxx X. Xxxxxxx
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Title: Sr. Vice President
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