EXHIBIT (d)(xix)
MERGERS AND ACQUISITIONS PORTFOLIO
OF
ENTERPRISE ACCUMULATION TRUST
PORTFOLIO MANAGER'S AGREEMENT
THIS AGREEMENT, made the 1st day of May 2003, is among Enterprise
Accumulation Trust (the "Fund"), a Massachusetts business trust, Enterprise
Capital Management, Inc., a Georgia corporation (hereinafter referred to as the
"Adviser"), and GAMCO Investors, Inc., a New York corporation, (hereinafter
referred to as the "Portfolio Manager").
BACKGROUND INFORMATION
(A) The Adviser has entered into an Investment Adviser's Agreement dated
as of July 1, 1999 with the Fund ("Investment Adviser's Agreement"). Pursuant to
the Investment Adviser's Agreement, the Adviser has agreed to render investment
advisory and certain other management services to all of the Portfolios of the
Fund, and the Portfolio has agreed to employ the Adviser to render such services
and to pay to the Adviser certain fees therefore. The Investment Adviser's
Agreement recognizes that the Adviser may enter into agreements with other
investment advisers who will serve as Portfolio Managers to the Portfolios.
(B) The parties hereto wish to enter into an agreement whereby the
Portfolio Manager will provide to the Mergers and Acquisitions Portfolio of the
Fund (the "Mergers and Acquisitions Portfolio") securities investment advisory
services for the Mergers and Acquisitions Portfolio.
WITNESSETH THAT:
In consideration of the mutual covenants herein contained, the Fund,
Adviser and the Portfolio Manager agree as follows:
(1) The Fund and Adviser hereby employ the Portfolio Manager to render
certain investment advisory services to the Mergers and Acquisitions Portfolio,
as set forth herein. The Portfolio Manager hereby accepts such employment and
agrees to perform such services on the terms herein set forth, and for the
compensation herein provided.
(2) The Portfolio Manager shall furnish the Mergers and Acquisitions
Portfolio advice with respect to the investment and reinvestment of the assets
of the Mergers and Acquisitions Portfolio, or such portion of the assets of the
Mergers and Acquisitions Portfolio as the Adviser shall specify from time to
time, in accordance with the investment objectives, restrictions and limitations
of the Mergers and Acquisitions Portfolio which are set forth in the Fund's most
recent Registration Statement. The Portfolio Manager may delegate its investment
advisory and other responsibilities and duties hereunder to an affiliated person
of the Portfolio Manager, subject to the Portfolio Manager retaining overall
responsibility for such powers and functions and any and all obligations and
liabilities in connection therewith.
(3) The Fund Manager shall maintain all books and records with respect to
the Mergers and Acquisitions Fund's portfolio transactions required by
subparagraphs (b)(5), (6), (7), (9), (10) and (11) and paragraph (f) of Rule
31a-1 under the Investment Company Act of 1940 ("the 1940 Act") and shall
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render to the Fund's Board of Directors such periodic and special reports as the
Fund's Board of Directors may reasonably request. The Fund Manager shall timely
furnish to the Adviser all information relating to the Fund Manager's services
under this Agreement needed by the Adviser to keep the other books and records
of the Mergers and Acquisitions Fund required by Rule 31a-1 under the 1940 Act.
The Fund Manager agrees that all records that it maintains on behalf of the
Mergers and Acquisitions Fund are property of the Mergers and Acquisitions Fund
and the Fund Manager will surrender promptly to the Mergers and Acquisitions
Fund any of such records upon the Mergers and Acquisitions Fund's request;
provided, however, that the Fund Manager may retain a copy of such records. The
Fund Manager further agrees to preserve for the periods prescribed by Rule 31a-2
under the 1940 Act any such records as are required to be maintained by it
pursuant to this Agreement. The Fund Manager shall perform a monthly
reconciliation of the Mergers and Acquisitions Fund to the holdings report
provided by the Fund's custodian and bring any material or significant variances
regarding holdings or valuations to the attention of the Adviser.
(4) The Portfolio Manager shall perform a monthly reconciliation of the
Mergers and Acquisitions Portfolio to the holdings report provided by the
Portfolio's custodian and bring any material or significant variances regarding
holdings or valuations to the attention of the Adviser.
(5) The Portfolio Manager shall for all purposes herein be deemed to be an
independent contractor. The Portfolio Manager has no authority to act for or
represent the Fund or the Portfolios in any way except to direct securities
transactions pursuant to its investment advice hereunder. The Portfolio Manager
is not an agent of the Fund or the Portfolios.
(6) It is understood that the Portfolio Manager does not, by this
Agreement, undertake to assume or pay any costs or expenses of the Fund or the
Portfolios.
(7) (a) The Adviser agrees to pay the Portfolio Manager for its services
to be furnished under this Agreement, with respect to each calendar month after
the effective date of the Agreement, on the twentieth (20th) day after the close
of each calendar month, a sum equal to 0.0375 of 1% of the average of the daily
closing net asset value of the Mergers and Acquisitions Portfolio managed by the
Portfolio Manager during such month (that is, .45 of 1% per year) for the first
$100,000,000 of assets under management and a sum equal to 0.0333 of 1% of the
average of the daily closing net asset value of the Mergers and Acquisitions
Portfolio during such month (that is, 0.40 of 1% per year) thereafter.
(7) (b) The payment of all fees provided for hereunder shall be prorated
and reduced for sums payable for a period less than a full month in the event of
termination of this Agreement on a day that is not the end of a calendar month.
(7) (c) For the purposes of this Paragraph 6, the daily closing net asset
values of the Portfolio shall be computed in the manner specified in the
Registration Statement for the computation of the value of such net assets in
connection with the determination of the net asset value of the Mergers and
Acquisitions Portfolio's shares.
(8) The services of the Portfolio Manager hereunder are not to be deemed
to be exclusive, and the Portfolio Manager is free to render services to others
and to engage in other activities so long as its services hereunder are not
impaired thereby. Without in any way relieving the Portfolio Manager of its
responsibilities hereunder, it is agreed that the Portfolio Manager may employ
others to furnish factual information, economic advice and/or research, and
investment recommendations, upon which its investment advice and service is
furnished hereunder.
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(9) In the absence of willful misfeasance, bad faith or gross negligence
in the performance of its duties hereunder, or reckless disregard of its
obligations and duties hereunder, the Portfolio Manager shall not be liable to
the Fund, the Mergers and Acquisitions Portfolio or the Adviser or to any
shareholder or shareholders of the Fund, the Mergers and Acquisitions Portfolio
or the Adviser for any mistake of judgment, act or omission in the course of, or
connected with, the services to be rendered by the Portfolio Manager hereunder.
(10) The Portfolio Manager will take necessary steps to prevent the
investment professionals of the Portfolio Manager and affiliated persons of the
Portfolio Manager who are responsible for investing assets of the Mergers and
Acquisitions Portfolio from taking, at any time, a short position in any shares
of any holdings of any Portfolio of the Fund for any accounts in which such
individuals have a beneficial interest, excluding short positions, including
without limitation, short against-the-box positions, effected for tax reasons.
The Portfolio Manager also will cooperate with the Fund in adopting a written
policy prohibiting xxxxxxx xxxxxxx with respect to Mergers and Acquisitions
Portfolio transactions insofar as such transactions may relate to the Portfolio
Manager.
(11) In connection with the management of the investment and reinvestment
of the assets of the Mergers and Acquisitions Portfolio, the Portfolio Manager
is authorized to select the brokers or dealers that will execute purchase and
sale transactions for the Mergers and Acquisitions Portfolio, and is directed to
use its best efforts to obtain the best available price and most favorable
execution with respect to such purchases and sales of portfolio securities for
the Mergers and Acquisitions Portfolio. Subject to this primary requirement, and
maintaining as its first consideration the benefits for the Mergers and
Acquisitions Portfolio and its shareholders, the Portfolio Manager shall have
the right, subject to the approval of the Board of Trustees of the Fund and of
the Adviser, to follow a policy of selecting brokers and dealers who furnish
statistical research and other services to the Mergers and Acquisitions
Portfolio, the Adviser, or the Portfolio Manager and, subject to the Conduct
Rules of the National Association of Securities Dealers, Inc., to select brokers
and dealers who sell shares of Portfolio of the Fund.
(12) The Fund may terminate this Agreement by thirty days written notice
to the Adviser and the Portfolio Manager at any time, without the payment of any
penalty, by vote of the Fund's Board of Trustees, or by vote of a majority of
its outstanding voting securities. The Adviser may terminate this Agreement by
thirty days written notice to the Portfolio Manager and the Portfolio Manager
may terminate this Agreement by thirty days written notice to the Adviser,
without the payment of any penalty. This Agreement shall immediately terminate
in the event of its assignment, unless an order is issued by the Securities and
Exchange Commission conditionally or unconditionally exempting such assignment
from the provision of Section 15 (a) of the Investment Company Act of 1940, in
which event this Agreement shall remain in full force and effect.
(13) Subject to prior termination as provided above, this Agreement shall
continue in force from the date of execution until May 1, 2005, and from year to
year thereafter if its continuance after said date: (1) is specifically approved
on or before said date and at least annually thereafter by vote of the Board of
Trustees of the Fund, including a majority of those Trustees who are not parties
to this Agreement or interested persons of any such party, or by vote of a
majority of the outstanding voting securities of the Fund, and (2) is
specifically approved at least annually by the vote of a majority of Trustees of
the Fund who are not parties to this Agreement or interested persons of any such
party cast in person at a meeting called for the purpose of voting on such
approval.
(14) The Adviser shall indemnify and hold harmless the Portfolio Manager,
its officers and Trustees and each person, if any, who controls the Portfolio
Manager within the mowing of Section 15 of
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the Securities Act of 1933 (any and all such persons shall be referred to as
"Indemnified Party"), against any loss, liability, claim, damage or expense
(including the reasonable cost of investigating or defending any alleged loss,
liability, claim, damages or expense and reasonable counsel fees incurred in
connection therewith), arising by reason of any matter to which this Portfolio
Manager's Agreement relates. However, in no case (i) is this indemnity to be
deemed to protect any particular Indemnified Party against any liability to
which such Indemnified Party would otherwise be subject by reason of willful
misfeasance, bad faith or gross negligence in the performance of its duties or
by reason of reckless disregard of its obligations and duties under this
Portfolio Manager's Agreement or (ii) is the Adviser to be liable under this
indemnity with respect to any claim made against any particular Indemnified
Party unless such Indemnified Party shall have notified the Adviser in writing
within a reasonable time after the summons or other first legal process giving
information of the nature of the claim shall have been served upon the Portfolio
Manager or such controlling persons.
The Portfolio Manager shall indemnify and hold harmless the Adviser
and each of its Trustees and officers and each person if any who controls the
Adviser within the meaning of Section 15 of the Securities Act of 1933, against
any loss, liability, claim, damage or expense described in the foregoing
indemnity, but only with respect to the Portfolio Manager's willful misfeasance,
bad faith or gross negligence in the performance of its duties under this
Portfolio Manager's Agreement. In case any action shall be brought against the
Adviser or any person so indemnified, in respect of which indemnity may be
sought against the Portfolio Manager, the Portfolio Manager shall have the
rights and duties given to the Adviser, and the Adviser and each person so
indemnified shall have the rights and duties given to the Portfolio Manager by
the provisions of subsection (i) and (ii) of this paragraph 13.
(15) Except as otherwise provided in paragraph 13 hereof and as may be
required under applicable federal law, this Portfolio Manager's Agreement shall
be governed by the laws of the State of Georgia.
(16) The Portfolio Manager agrees to notify the parties within a
reasonable period of time regarding a material change in the membership of the
Portfolio Manager.
(17) The terms "vote of a majority of the outstanding voting securities,"
"assignment" and "interested persons," when used herein, shall have the
respective meanings specified in the Investment Company Act of 1940 as now in
effect or as hereafter amended.
(18) Unless otherwise permitted, all notices, instructions and advice with
respect to security transactions or any other matters contemplated by this
Agreement shall be deemed duly given when received in writing:
by the Portfolio Manager: GAMCO Investors, Inc.
Xxx Xxxxxxxxx Xxxxxx
Xxx, XX 00000
by the Adviser: Enterprise Capital Management, Inc.
0000 Xxxxxxxxx Xxxx, X.X., Xxxxx 000
Xxxxxxx, XX 00000-0000
by the Fund: Enterprise Accumulation Trust c/o Enterprise Capital
Management, Inc.
0000 Xxxxxxxxx Xxxx, X.X., Xxxxx 000
Xxxxxxx, XX 00000-0000
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or by such other person or persons at such address or addresses as shall be
specified by the applicable party, in each case, in a notice similarly given.
Each party may rely upon any notice or other communication from the other
reasonably believed by it to be genuine.
(19) This Agreement may be executed in one or more counterparts, each of
which shall be deemed to be an original and all of which, when taken together,
shall constitute one and the same agreement.
(20) This Agreement constitutes the entire agreement between the Portfolio
Manager, the Adviser and the Fund relating to the Mergers and Acquisitions
Portfolio.
IN WITNESS WHEREOF, the parties have caused this Agreement to be signed
by their duly authorized officers and attested, as of the date first above
written.
ENTERPRISE ACCUMULATION TRUST
ATTEST: By:
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Secretary Xxxxxx Xxxxxx
Chairman, President and CEO
ENTERPRISE CAPITAL MANAGEMENT, INC.
ATTEST: By:
----------------------- --------------------------------------
Secretary Xxxxxx Xxxxxx
Chairman, President and CEO
GAMCO INVESTORS, INC.
ATTEST: By:
----------------------- -------------------------------------
Name: Name:
------------------------- ------------------------------------
Title:
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