EXHIBIT 99.d-7
MANAGEMENT AGREEMENT
BETWEEN
SCOUT INVESTMENT ADVISORS, INC.
AND
UMB SCOUT KANSAS TAX-EXEMPT BOND FUND, INC.
THIS AGREEMENT, made and entered into this 12th day of May, 2001, by and between
UMB Scout Kansas Tax-Exempt Bond Fund, Inc., a Maryland corporation (hereinafter
referred to as the "Company") and Scout Investment Advisors, Inc., a Missouri
corporation (hereinafter referred to as the "Manager"), and which Agreement may
be executed in any number of counterparts, each of which shall be deemed to be
an original, but all of which together shall constitute but one instrument.
WHEREAS the Company was founded for the purpose of engaging in the
business of investing and reinvesting its property and assets and to operate as
an open-end, management investment company, as defined in the Investment Company
Act of 1940, as amended (the "Act"), under which it is registered with the
Securities and Exchange Commission, and
WHEREAS the Manager was organized for the purpose of acting as the
successor to UMB Bank, n.a., to be engaged in the business of supplying
investment advice and management service to the investment companies within the
UMB Scout Funds group, as an independent contractor, and
WHEREAS the Company and the Manager desire to enter into a contractual
arrangement whereby the Manager provides investment advice and management
service to the Company, for a fee,
NOW THEREFORE, in consideration of the mutual promises herein
contained, and other good and valuable consideration, receipt of which is hereby
acknowledged, it is mutually agreed and contracted by and between the parties
hereto that:
1. The Company hereby employs the Manager, for the period set forth in
Paragraph 5 hereof, and on the terms set forth herein, to render investment
advice and management service to the Company, subject to the supervision and
direction of the Board of Directors of the Company. The Manager hereby accepts
such employment and agrees, during such period, to render the services and
assume the obligations herein set forth, for the compensation herein provided.
The Manager shall, for all purposes herein, be deemed to be an independent
contractor, and shall, unless otherwise expressly provided and authorized, have
no authority to act for or represent the Company in any way, or in any other way
be deemed an agent of the Company.
The Manager shall furnish the Company investment management and
administrative services. Investment management shall include analysis, research
and portfolio recommendations consistent with the Company's objectives and
policies. Administrative services shall include the services and compensation of
such members of
the Manager's organization as shall be duly elected officers and/or Directors of
the Company and such other personnel as shall be necessary to carry out its
normal operations; fees of the independent Directors, the custodian, the
independent public accountant and legal counsel (but not legal and audit fees
and other costs in contemplation of or arising out of litigation or
administrative actions to which the Company, its officers or Directors are a
party or incurred in anticipation of becoming a party); rent; the cost of a
transfer and dividend disbursing agent or similar in-house services;
bookkeeping; accounting; and all other clerical and administrative functions as
may be reasonable and necessary to maintain the Company's records and for it to
operate as an open-end management investment company. Exclusive of the
management fee, the Company shall bear the cost of any interest, taxes, dues,
fees and other charges of governments and their agencies, including the cost of
qualifying the Company's shares for sale in any jurisdiction, brokerage
commissions or any other expenses incurred by it which are not assumed herein by
the Manager.
All property, equipment and information used by the Manager in the
management and administration of the Company, shall belong to the Manager.
Should the management and administrative relationship between the Company and
the Manager terminate, the Company shall be entitled to, and the Manager shall
provide the Company, a copy of all information and records in the Manager's file
necessary for the Company to continue its functions, which shall include
computer systems and programs in use as of the date of such termination; but
nothing herein shall prohibit thereafter the use of such information, systems or
programs by the Manager, so long as such does not unfairly interfere with the
continued operation of the Company.
2. As compensation for the services to be rendered to the Company
by the Manager under the provisions of this Agreement, the Company agrees to pay
semimonthly to the Manager an annual fee based on the average total net assets
of the Company computed daily in accordance with the Company's Articles of
Incorporation and By-Laws as follows:
a. Fifty one-hundredths of one percent (0.50%) of the
average total net assets of the Company.
b. Should the Company's normal operating expenses
exclusive of taxes, interest, brokerage commission and extraordinary
costs exceed limits established by any law, rule or regulation of any
jurisdiction in which the Company's shares are registered for sale, the
Manager shall reimburse the Company in the amount of the excess.
3. It is understood and agreed that the services to be rendered
by the Manager to the Company under the provisions of the Agreement are not to
be deemed exclusive, and the
Manager shall be free to render similar or different services to others
so long as its ability to render the services provided for in this Agreement
shall not be impaired thereby.
4. It is understood and agreed that the Directors, officers,
agents, employees and shareholders of the Company may be interested in the
Manager as owners,
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employees, agents or otherwise, and that owners, employees and agents of the
Manager may be interested in the Company as shareholders or otherwise. It is
understood and agreed that shareholders, officers, Directors and other personnel
of the Manager are and may continue to be officers and Directors of the Company,
but that they receive no remuneration from the Company solely for acting in
those capacities.
5. This Agreement shall become effective on May 12, 2001,
provided it is approved by the Company's Board of Directors. It shall remain in
force for an initial period of two years, and thereafter may be renewed for
successive periods not exceeding one year only so long as such renewal and
continuance is specifically approved at least annually by the Board of Directors
or by vote of a majority of the outstanding voting securities of the Company as
prescribed by the Act, and only if the terms and the renewal of this Agreement
have been approved by a vote of a majority of the Directors of the Company
including a majority of the Directors who are not parties to the Agreement or
interested persons of any such party, cast in person at a meeting called for the
purpose of voting on such approval. No amendment to this Agreement shall be
effective unless the terms thereof have been approved by the vote of a majority
of outstanding voting securities of the Company as prescribed by the Act (if
required under the Act) and by vote of a majority of the Directors of the
Company who are not parties to the Agreement or interested persons of any such
party, cast in person at a meeting called for the purpose of voting on such
approval. It shall be the duty of the Directors of the Company to request and
evaluate, and the duty of the Manager to furnish, such information as may
reasonably be necessary to evaluate the terms of this Agreement and any
amendment thereto. This Agreement may be terminated at any time, without the
payment of any penalty, by the Directors of the Company, or by the vote of a
majority of the outstanding voting securities of the Company as prescribed by
the Act on not more than sixty (60) days written notice to the Manager, and it
may be terminated by the Manager upon not less than sixty (60) days written
notice to the Company. It shall terminate automatically in the event of its
assignment by either party unless the parties hereby, by agreement, obtain an
exemption from the Securities and Exchange Commission from the provisions of the
Act pertaining to the subject matter of this paragraph. Any notice, request or
instruction provided for herein, or for the giving of which, the occasion may
arise hereunder, shall be deemed duly given, if in writing and mailed by
registered mail, postage prepaid, addressed to the regular executive office of
the Company or the Manager, as the case may be. As used in this Agreement, the
terms "assignment", "a majority of the outstanding voting securities" and
"interested persons" shall have the same meaning as similar terms contained in
the Act.
6. The Manager shall not be liable for any error in judgment or
mistake at law for any loss suffered by the Company or Fund in connection with
any matters to which this Agreement relates, except that nothing herein
contained shall be construed to protect the Investment Manager against any
liability by reason of willful misfeasance, bad faith or gross negligence in the
performance of duties or by reckless disregard of its
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obligations or duties under this Agreement.
UMB SCOUT KANSAS TAX-EXEMPT
BOND FUND, INC.
By:_________________________
Name:_______________________
Title:______________________
ATTEST:
By:_________________________
Name:_______________________
Title:______________________
[SEAL]
SCOUT INVESTMENT ADVISORS, INC.
By:_________________________
Name:_______________________
Title:______________________
ATTEST:
By:_________________________
Name:_______________________
Title:______________________
[SEAL]
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