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(d)(4)
INVESTMENT ADVISORY AGREEMENT
This Investment Advisory Agreement is made as of the __________ day of
_______________, 1999, by and between VANTAGEPOINT INVESTMENT ADVISERS, LLC, a
Delaware limited liability company (hereafter "Client"), and TCW FUNDS
MANAGEMENT, INC., at 000 X. Xxxxxxxx Xxxxxx, Xxx Xxxxxxx, Xxxxxxxxxx
90017(hereafter "Adviser") and is effective as of March 1, 1999 (the
"Effective Date").
WHEREAS, the Vantagepoint Funds (the "Funds") is a Delaware Business
Trust registered as an open-end management investment company under the
Investment Company Act of 1940, as amended (the "Investment Company Act");
WHEREAS, Client is party to an Investment Adviser Agreement with the
Funds for management of the investment operations of the Funds including the
establishment and operation of investment portfolios for the Funds and the
entering into of contracts with sub-advisers to assist in managing the
investment of the Funds property;
WHEREAS, Client and Adviser wish to enter into an agreement pursuant
to which Adviser will provide such assistance to Client.
AGREEMENTS:
In consideration of the performance by the Adviser as investment
adviser of certain assets held by the Funds, the Client has authorized the
Adviser to manage the securities and other assets as follows:
1. ACCOUNT
The account with respect to which the Adviser shall perform its
services shall consist of those assets of the Funds which the Client determines
to assign to an account with the Adviser, together with all income earned by
those assets and all realized and unrealized capital appreciation related to
those assets (hereafter "Account"). From time to time, the Client may, upon
notice to the Adviser, make additions to the Account and may, upon notice to the
Adviser, make withdrawals from the Account.
2. APPOINTMENT STATUS, POWERS OF ADVISER
(a) Purchase and Sale. Client hereby appoints Adviser to manage the
Account on the terms and conditions set forth in this Agreement. Subject to the
restrictions set forth in this Agreement, and acting always in conformity with
the Investment Policies provided in Paragraph 4, Adviser shall supervise and
direct investment of the Account. Client hereby grants the Adviser complete,
unlimited and unrestricted discretion and authority to select portfolio
securities with respect to the
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Account including the power to acquire (by purchase, exchange, subscription or
otherwise), to hold and dispose (by sale, exchange or otherwise). The Adviser
will consult with Client, upon the request of the Client, concerning any
transactions it makes with respect to the investment of the Account.
(b) Limitation on Authority. Except as expressly authorized herein or
hereafter from time to time, Adviser shall for all purposes be deemed an
independent contractor and shall have no authority to act for or to represent
the Client or the Funds in any way or otherwise to be an agent of the Client or
the Funds.
(c) Voting. Unless otherwise instructed by Client, Adviser shall have
discretion to take any action or render any advice with respect to the voting of
shares or the execution of proxies solicited from time to time by, or with
respect to, the issuers of securities held in the Account. Adviser will report
annually to Client regarding such voting.
(d) Key Personnel. Adviser agrees that the following key personnel
have primary responsibility with respect to the investment management of the
Account. If the(se) individual(s) is unable to devote sufficient time to
maintain primary responsibility of the Account, the Adviser must give Client
written advance notice, or prompt notice within three (3) business days, of the
name of the person designated by the Adviser to replace or supplement the
individual(s). In addition, the Adviser will give Client prompt written notice
of the replacement of any employee of the Adviser who has direct supervisory
responsibility for the key personnel or who has responsibility for setting
investment policy.
Key Personnel:
Xxxxx Xxxxxx
Xxxxxxx Xxxxxxx
Xxxxxxx Xxxxxx
3. ACCEPTANCE OF APPOINTMENT
Adviser accepts the appointment as an investment adviser and agrees to
use its best efforts and professional judgment to make timely investment
transactions for the Client with respect to the investments of the Account, and
to provide the other services required of the Adviser under the provisions of
this Agreement.
4. INVESTMENT POLICIES
(a) Investment Objectives. The Adviser will adhere to the investment
objectives, guidelines, restrictions, and liquidity requirements of the Funds as
specified by the Client on SCHEDULE A hereto, and as restated or modified from
time to time by the Client in written notice to the Adviser.
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(b) Agreement. The Adviser will adhere to all specific provisions
established in the Agreement and in the Registration Statement as filed with the
Securities and Exchange Commission on Form N-1A ("Registration Statement), which
is hereby incorporated by reference and made a part of this Agreement. The
Client shall give written notice to the Adviser of any amendments to the
Registration Statement, which amendments, upon their receipt by the Adviser,
shall be binding on the Adviser.
(c) Investment Adviser Guidelines. The Adviser shall act in accordance
with the specific statement of Investment Adviser Guidelines, SCHEDULE B, as
restated or modified from time to time by the Client in written notice to the
Adviser. The Client retains the right, on written notice to the Adviser, to
modify any such objectives, guidelines, restrictions, and liquidity requirements
in any manner at any time.
(d) Conflict in Policies. If a conflict in policies or guidelines
referenced herein occurs, the Registration Statement shall govern for purposes
of this Agreement.
5. CUSTODY, DELIVERY, RECEIPT OF SECURITIES
(a) Custody Responsibilities. The Client shall designate one or more
custodians to hold the Account. The Custodian, as designated by the Client will
be responsible for the custody, receipt and delivery of securities and other
assets of the Funds (including the Account), and the Adviser shall have no
authority, responsibility or obligation with respect to the custody, receipt or
delivery of securities or other assets of the Funds (including the Account). In
the event that any cash or securities of the Funds are delivered to the Adviser,
it will promptly deliver the same over to the Custodian, in the name of the
Funds.
(b) Securities Transactions. All securities transactions for the
Account will be consummated by payment to or delivery by the Funds of cash or
securities due to or from the Account. The Adviser will notify the Custodian of
all orders to brokers for the Account by 11:00 am EST on the day following the
trade date and will affirm the trade or fax trade authorization within one (1)
business day after the trade date (T+1).
(c) Tri-Party Agreement. The Adviser is authorized to enter into
Tri-Party Repurchase Agreements and sign the standard PSA tri-party agreement
(the "Tri-Party Agreement") on behalf of the Client and the subcustodian
thereunder is authorized to act as a subcustodian for the Account's assets
involved in any tri-party repurchase agreement pursuant to such Tri-Party
Agreement.
6. RECORD KEEPING AND REPORTING
(a) Records. Adviser will maintain proper and complete records
relating to the furnishing of services under this Agreement, including records
with respect to the
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acquisition, holding and disposition of securities for Client. All records
maintained pursuant to this Agreement shall be subject to examination by Client
and by persons authorized by it at all times upon reasonable notice. Except as
expressly authorized in this Agreement or as required by applicable law,
regulation or order of court or as directed by other party in writing, Adviser
and Client shall keep confidential the records and other information obtained by
reason of this Agreement (including, with respect to Client, the investment
information and transactions executed by Adviser). Upon termination of this
Agreement, Adviser shall promptly, upon demand, return to Client all records
Client reasonably believes are necessary in order to discharge its
responsibilities to the Funds. Adviser shall be entitled to retain originals or
copies of records pursuant to the requirements of applicable laws or
regulations.
(b) Quarterly Valuation Reports. Adviser shall use best efforts to
provide to the Client within TEN (10) business days after the end of each
calendar quarter a statement of the fair market value of the Account as of the
close of such quarter together with an itemized list of the assets in the
Account, as that information is reported on Adviser's recordkeeping system.
(c) Valuation Methodology. For purposes of this Agreement, fair market
value shall mean, as of a particular date, the value of the Account (determined
in accordance with generally accepted accounting principles consistently
applied), plus income accrued thereon less the liabilities related to the assets
in the Account. Adviser shall reconcile security and cash positions , and market
values, and report discrepancies to the Client.
(d) Loss Reimbursement. Adviser shall reimburse the Account for any
material loss directly caused by Adviser's breach of the standard of care set
forth in Section 12 that causes a material delay in the accurate daily pricing
of the Fund, providing such material loss was not the result of action or
inaction of other service providers to the Client or the Fund in failing to
observe the instructions of the Adviser. It is expressly understood that Adviser
has no responsibility for performing the daily pricing of the Fund(s).
(e) Monthly Reports. Adviser shall provide the Client an itemized
report as to the securities in the account, the fair market value thereof and
the accrued income thereon, as that information is reported on Adviser's
recordkeeping system, within FOUR (4) business days after the end of each
Calendar Month. The Adviser shall also use best efforts to provide, in writing,
preliminary performance numbers and a brief explanation of these results within
FIVE (5) business days after the end of each Calendar Month. The requested
format will be as mutually agreed by Adviser and Client. For purposes of this
Agreement, fair market value shall mean, as of a particular date, the value of
the Account plus income accrued thereon less the liabilities related to the
assets in the Account.
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(f) Reports on Request. Adviser shall provide to Client promptly upon
request any information available in the records maintained by Adviser relating
to the Account.
7. PURCHASE AND SALE OF SECURITIES
(a) Selection of Brokers. Except to the extent otherwise instructed by
Client, (it being understood that Client may, in its absolute discretion, direct
portfolio transactions for which Adviser is responsible to any broker that
Client may see fit), Adviser shall place all orders for the purchase and sale of
securities on behalf of the Client with brokers or dealers selected by Adviser,
but not with a person affiliated with Adviser, as the term "affiliated person"
is defined in the Investment Company Act of 1940 (hereafter an "Affiliate").
(b) Best Execution. In placing such orders, the Adviser will give
primary consideration to obtaining the most favorable price and efficient
execution. In evaluating the terms available for executing particular
transactions for Client and in selecting brokers and dealers to execute such
transactions, the Adviser may consider, in addition to commission cost and
execution capabilities, the financial stability and reputation of brokers and
dealers and the brokerage and research services (as those terms are defined in
Section 28(e) of the Securities Exchange Act of 1934, as amended) provided by
brokers and dealers. Adviser is authorized to pay a broker or dealer who
provides such brokerage and research services a commission for executing a
transaction which is in excess of the amount of commission another broker or
dealer would have charged for effecting that transaction if Adviser determines
that such commission is reasonable in relation to the value of the brokerage and
research services provided by such broker or dealer in discharging
responsibilities with respect to the Account.
(c) Bunching Orders. Client agrees that Adviser may aggregate sales
and purchase orders of Account with similar orders being made simultaneously for
other accounts managed by Adviser, if in Adviser's reasonable judgment such
aggregation shall result in an overall economic benefit to the Account taking
into consideration the advantageous selling or purchase price, brokerage
commission and other expenses. Client acknowledges that the determination of
such economic benefit to Client by Adviser represents Adviser's evaluation that
client is benefited by relatively better purchase or sales prices, lower
commission expenses and beneficial timing of transactions or a combination of
these and other factors.
8. INVESTMENT FEES
(a) Fee Schedule. The compensation of the Adviser for its services
under this Agreement shall be calculated and paid by the Client from the assets
of the Account in accordance with SCHEDULE C hereto. The Adviser shall send a
written invoice
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to the Client within 30 days of the quarter end and shall be duly compensated
from the assets of the Account.
(b) Fee Computation. The Adviser's fee for each calendar quarter shall
be calculated as set forth in Schedule C.
(c) Fee Amendment. Fee rates may be changed from time to time by
agreement between the Client and the Adviser; provided, however, that no
increase in such rates shall be made during the first calendar year of this
Agreement.
(d) Pro Rata Fee. If the Adviser should serve for less than the whole
of any calendar quarter, its compensation shall be determined as provided above
on the basis of the ending market value of the Account in the month in which the
termination occurs and shall be payable on a pro rata basis for the period of
the calendar quarter for which it has served as Adviser hereunder.
9. BEST EFFORTS; NON-EXCLUSIVITY OF SERVICES
The Adviser shall devote its best efforts and such time as it deems
necessary to provide prompt and expert service to the Client. The services of
Adviser to be provided to Client hereunder are not to be deemed exclusive and
Adviser shall be free to provide similar services for its own account and the
accounts of other persons and to receive compensation for such services. Client
acknowledges that Adviser and its members, Affiliates and employees, and
Adviser's other clients may at any time, have, acquire, increase, decrease, or
dispose of positions in the same investments which are at the same time being
held, acquired for or disposed of under this Agreement for the Client. Adviser
shall have no obligation to acquire or dispose of a position in any investment
pursuant to this Agreement simply because Adviser, its directors, members,
Affiliates or employees invest in such a position for its or their own accounts
or for the account of another client.
10. XXXXXXX XXXXXXX POLICIES AND CODE OF ETHICS
Adviser hereby represents that it has adopted policies that meet the
requirements of Rule 17j-1 under the Investment Company Act. Copies of such
policies shall be delivered to the Client, and any violation of such policies by
personnel of the Adviser shall be reported to the Client.
11. INSURANCE
At all times during the term of this Agreement, Adviser shall
maintain, at its own cost and expense, professional liability insurance for
errors, omissions, and negligent acts, in an amount and with such terms as are
standard in the financial services industry
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for an investment adviser managing the amount of aggregate assets managed by
Adviser for Client and for the Adviser's other clients.
12. LIABILITY
Adviser shall not be liable to Client for honest mistakes of judgment
or for action or inaction taken in good faith for a purpose that the Adviser
reasonably believes to be in the best interests of the Client. Adviser shall be
liable to Client for any liability, damages or expenses of Client arising out of
the negligence, malfeasance or violation of applicable law by Adviser or any of
its officers, employees or Affiliates in providing management under this
Agreement. However, neither this provision nor any other provision of this
Agreement shall constitute a waiver or limitation of any rights which Client may
have under federal or state securities laws.
13. TERM
This Agreement shall be in effect for an initial term of two years
beginning on the Effective Date. This Agreement may be renewed thereafter for
successive one-year periods if such renewal is approved annually by the majority
of those members of the Funds' Board of Directors who are not "interested
persons" as that term is defined in the Investment Company Act.
14. TERMINATION
This Agreement may be terminated by either party hereto, without the
payment of any penalty, immediately upon notice to the other in the event of a
breach of any provision thereof by the party so notified, or otherwise by
Adviser upon sixty (60) days' written notice to the Client or by Client upon 30
days' written notice to Adviser, except that this Agreement shall automatically
terminate in the event of its assignment, as provided in Paragraph 19, at the
discretion of the Client in the event of Adviser's ownership change as provided
in Paragraph 19, or upon the termination of the Funds. Any termination in
accordance with the terms of this Agreement shall not cause the payment of any
penalty. Any such termination shall not affect the status, obligations or
liabilities of any party hereto to the other. In the event of termination for a
breach of this Agreement, any trades executed but not yet settled at the time of
notice of termination shall be settled.
15. REPRESENTATIONS
(a) Adviser hereby confirms to Client that Adviser is registered as an
investment adviser under the Investment Advisers Act of 1940, as amended, that
it has full power and authority to enter into and perform fully the terms of
this Agreement and that the execution of this Agreement on behalf of Adviser has
been duly authorized and,
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upon execution and delivery, this Agreement will be binding upon Adviser in
accordance with its terms.
(b) Client hereby confirms to Adviser that it has full power and
authority to enter into this Agreement and that the execution of this Agreement
on behalf of Client has been fully authorized and, upon execution and delivery,
this Agreement will be binding upon Client in accordance with its terms.
16. NOTICES
Notices or other notifications given or sent under or pursuant to this
Agreement shall be in writing and be deemed to have been given or sent if
delivered to the party at its address listed below in person or by telex or
telecopy receipt of which is confirmed or by mail or by registered mail, return
receipt requested. The addresses of the parties are:
CLIENT:
Vantagepoint Investment Advisers, LLC
Attention: Legal Department
c/o ICMA Retirement Corporation
000 Xxxxx Xxxxxxx Xxxxxx, XX, Xxx. 000
Xxxxxxxxxx, X.X. 00000-0000
ADVISER:
TCW Funds Management, Inc.
000 X. Xxxxxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000
Attn: Xx. Xxx Xxxxxx (with a copy to General Counsel)
Each party may change its address by giving notice as herein required.
17. SOLE INSTRUMENT
This instrument constitutes the sole and only agreement of the parties
to it relating to its object and correctly sets forth the rights, duties, and
obligations of each party to the other as of its date. Any prior agreements,
promises, negotiations or representations not expressly set forth in this
Agreement are of no force or effect.
18. WAIVER OR MODIFICATION
No waiver or modification of this Agreement shall be effective unless
reduced to a written document signed by the party to be charged. No failure to
exercise and no delay in exercising, on the part of any party hereto, of any
right, remedy, power or privilege hereunder, shall operate as a waiver thereof.
Only the Chief Executive Officer,
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has authority on behalf of Client to modify or waive any of the provisions of
the Agreement.
19. ASSIGNMENT AND OWNERSHIP CHANGE
This Agreement shall automatically terminate in the event of its
assignment. Adviser agrees to provide immediate written notice in the event of
an ownership change. Such an ownership change will entitle, but not require, the
Client to terminate the Agreement immediately or upon notice.
20. COUNTERPARTS
This Agreement may be executed in counterparts each of which shall be
deemed to be an original and all of which, taken together, shall be deemed to
constitute one and the same instrument.
21. CHOICE OF LAW
This Agreement shall be governed by, and the rights of the parties
arising hereunder construed in accordance with, the laws of the State of
Delaware without reference to principles of conflict of laws.
22. YEAR 2000 WARRANTY
Adviser will use commercially reasonable efforts to prevent any
material problems from and after January 1, 2000 relating to the date function
or functions impacted by the date in its computer systems, auto-dialer system or
other date processing or information management systems used by it with respect
to the Client and the Account.
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IN WITNESS WHEREOF, THE PARTIES HERETO EXECUTE THIS AGREEMENT ON February 25,
1999 and make it effective on the date set forth.
CLIENT ADVISER
Vantagepoint TCW Funds Management, Inc.
Investment Advisers, LLC
by: by:
/s/ XXXXXX XXXXXX /s/ XXXXXXX XXXXXX
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(signature) (signature)
President Managing Director
--------------------- ---------------------
(name, title) (name, title)
/s/ XXXXXXXX XXXXX
---------------------
(signature)
Vice President
---------------------
(name, title)
Date: Date:
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ADDENDUM DATED March 1, 1999 TO THE
INVESTMENT ADVISORY AGREEMENT DATED February 25, 1999
This addendum modifies and forms a part of the Investment Advisory Agreement
(the "Agreement") dated March 1 1999, between Vantagepoint Investment
Advisers, LLC, a Delaware corporation ("Client"), and TCW Funds Management, Inc.
("Adviser"), relating to the Vantagepoint Funds ("VF").
All terms used in this Addendum have the same meaning given to them in the
Agreement unless specifically noted otherwise.
1. The assets of the Account to be managed by the Adviser under the Agreement
and this Addendum are assets of the Aggressive Opportunities Fund (the "Fund"),
a portfolio of VF. For purposes of Section 8 (Fees) and Schedule C, all payments
due to Adviser shall be solely made from the assets of the Fund.
2. All references in the Agreement and this Addendum to the Investment Policies
to be followed by Adviser in managing the assets of the Fund are hereby deemed
to include the Investment Policies set forth in the Agreement and any Schedules
to the Agreement, as well as the Fund's current prospectus and statement of
additional information as on file with the Securities and Exchange Commission.
3. The activities of the Client and the Adviser in managing the assets of the
Fund pursuant to the Agreement and this Addendum shall in all instances be
conducted subject to the supervision and direction of the Board of Directors of
VF.
4. For purposes of Sections 8 (Fees), 12 (Liability), 13 (Term), 14
(Termination), 15 (Representation), 16 (Notices), 18 (Waiver or Modification),
19 (Assignment and Ownership Change), and 22 (Year 2000 Warranty) of the
Agreement, as well as for purposes of Schedule C of the Agreement, VF is hereby
made a party to the Agreement and shall be entitled to all notices, protections
and rights set forth in those Sections and in Schedule C to which Client is
entitled.
5. For purposes of the Agreement and this Addendum, Client and Adviser hereby
agree to maintain all books and records relating to VF that are required to be
maintained in accordance with good practice, applicable federal and state
securities laws, including the Investment Company Act of 1940 and or the
Investment Advisers Act of 1940, and such reasonable instructions as shall be
provided to Adviser by Client from time to time.
6. Adviser shall furnish Client and the Board of Directors of VF such periodic
and special reports and information as either of them may request, including
such
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information as shall be reasonably necessary to evaluate the terms of any
advisory agreement between Client and Adviser with respect to assets of VF.
7. For purposes of the Agreement and this Addendum, the value of the assets of
the Fund managed by Adviser shall be calculated in accordance with the
procedures for determining net asset value per share ("NAV") set forth in the
Fund's prospectus and statement of additional information.
8. Section 6 is hereby amended as follows:
a. 6(a) is amended beginning on line 8 and ending on line 9 by
deleting the parentheses and all language with in the
parentheses;
b. 6(b) is deleted in its entirety;
c. 6(c) is redesignated 6(b) Reconciliations, the first sentence is
deleted;
d. 6(d) is changed to 6(c); and
e. 6(e) is deleted and 6(f) is changed to 6(d).
9. Section 8, Investment Fees, is amended by deleting 8(b) and 8(c) in their
entirety and by redesignating 8(d) as 8(b).
10. Section 15, Representations, is amended by the insertion of 15(c) below:
"(c) Adviser hereby acknowledges that VF is registered as an open end
investment company under the Investment Company Act of 1940 and is
subject to taxation as a regulated investment company under the
Internal Revenue Code; Adviser hereby represents that it is familiar
with the requirements of such laws and the rules and regulations
thereunder as they apply to VF and has systems and procedures in place
reasonably designed to permit Adviser, Client, and VF to comply with
such requirement."
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SCHEDULE A
THE VANTAGEPOINT FUNDS
AGGRESSIVE OPPORTUNITIES FUND
STATEMENT OF INVESTMENT POLICIES
These Investment Policies and Guidelines have been adopted by the Vantagepoint
Funds (the "Funds") to govern the management and administration of the
Aggressive Opportunities Fund by Vantagepoint Investment Advisors, LLC ("VIA").
They may be reviewed and revised at the discretion of the Directors of the
Vantagepoint Funds (the "Directors"). VIA is responsible for the monitoring and
appointment of subadvisers to handle the day-to-day investment of assets
assigned to them.
I. GENERAL DESCRIPTION AND GOALS
The Aggressive Opportunities Fund seeks high, long-term capital
appreciation by investing in a variety of flexible investment
approaches and techniques. Investments may include U.S. and foreign
equity securities, options, financial derivatives, and short
selling.
II. STRUCTURE
The assets of the Aggressive Opportunities Fund shall be managed by
two or more subadvisers. The subadvisers may be retained to manage
separate accounts under discretionary investment advisory contracts.
Each subadviser will be selected for its individual investment
management expertise and each will operate independently of the
others. Each subadviser must either be registered with the
Securities and Exchange Commission (SEC) under the Investment
Advisers Act of 1940 or a Bank, Insurance Company or Trust Company
exempt as such from registration.
Each subadviser shall exercise complete management discretion over
assets of the Fund allocated to its account in a manner consistent
with these Investment Policies and Guidelines and with such further
investment limitations and conditions as may be recommended by VIA
and approved by the Directors. subadvisers will be obligated to
manage Fund assets as if they were subject to the fiduciary duty of
care that applies under the Employee Retirement Income Security Act
of 1974 (ERISA) governing pension and profit sharing assets.
III. INVESTMENT STRATEGY
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VIA shall select subadvisers that represent a variety of portfolio
management approaches and investment disciplines. These investment
approaches will be combined in a complementary manner to effectively
achieve the investment objective of the Fund. The Fund as a whole
will be more diversified than each individual subadviser's
portfolio.
Investment strategies employed by the subadvisers included in the
Aggressive Opportunities Fund may include:
- equity securities of U.S. issuers including small and
micro-capitalization growth stocks,
- securities issued by companies that are "distressed" or "out
of favor",
- securities issued by foreign companies including companies
located in or doing business in emerging markets,
- commodities,
- securities of companies that fluctuate with the value of
commodities
- such as precious metals,
- short selling,
- purchasing and writing options,
- futures contracts, and
- leverage.
Certain of the above strategies are not permitted or their use is limited
under the Investment Guidelines for the individual subadvisers.
IV. PERFORMANCE BENCHMARKS
Performance benchmarks will be established for the Fund. These benchmarks
will be recommended by VIA and adopted by the Directors and will be
reviewed and revised as appropriate from time to time. The current
performance benchmarks for the Fund are appended to this document as
Exhibit I.
V. DIRECTOR REVIEW
VIA will report periodically to the Directors on performance of the Fund
against benchmarks and on subadviser results and will evaluate for the
Directors the overall performance of the Fund relative to its objectives.
The Directors will consider such reports and other relevant factors in
appraising the investment objectives and performance of the Fund.
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INVESTMENT GUIDELINES
I. ELIGIBLE INVESTMENTS
A. EQUITY SECURITIES: U.S. and Non-U.S. common stock, preferred
stock, common stock equivalents (units of beneficial interest),
American Depository Receipts, convertible preferred stocks,
warrants, and other rights.
B. CASH/CASH EQUIVALENTS: Fixed income obligations with maturity less
than one year, or short-term accounts or securities managed by a
custodian institution.
C. FIXED INCOME: Fixed income and convertible fixed income securities
with maturities greater than one year.
D. FINANCIAL FUTURES: Equity index futures.
E ELIGIBLE PRACTICES: There are no restrictions on subadvisers as to
the following:
- Portfolio turnover.
- Realized gains and losses.
F. ELIGIBLE INVESTMENT LIMITS
MINIMUM NORMAL MAXIMUM
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RANGE
-----
U.S. equity securities 65% 80-100% 100%
Non-U.S. equity securities 0% 0-10% 20%
Cash and cash equivalents 0% 0-20% 35%
Fixed income securities
except derivatives 0% 0-5% 25%
Convertible securities 0% 5-15% 25%
II. PROHIBITED PRACTICES AND SECURITIES
A. Securities for which there is no established trading market.
B. Securities issued by the subadvisers of the Fund or their
affiliates.
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C. General partner interests.
D. Direct investments in oil, gas, or other mineral exploration or
development programs.
E. Direct investments in real estate or interests in real estate;
this does not preclude investment in purchases of securities of
real estate investment trusts and other companies holding real
estate or interests in real estate.
F. Commingled funds; this does not preclude investment in mutual
funds up to 10% of the Fund's market value at the time of
purchase.
G. Acquisition of securities that would cause exposure to non-equity
holdings to exceed 35% of the Fund's market value at the time of
purchase.
H. Acquisition of securities that would cause exposure to a single
industry to exceed 25% of the Fund's market value at the time of
purchase.
I. In the absence of prior consent of VIA, acquisition of securities
of an issuer that would cause more than 5% of the Fund to be
invested in such securities.
J. In the absence of prior consent of VIA, acquisition of more than
5% of the outstanding shares of any class of equity securities.
III. SECURITIES AND PRACTICES NOT OTHERWISE MENTIONED
Any securities or practices not enumerated in Section I or Section II of
these Investment Guidelines may be acquired or employed, as the case may
be, but only if explicitly approved in advance by VIA.
IV. SECURITIES LENDING
Nothing herein shall prevent loans of securities in the Aggressive
Opportunities Fund pursuant to an established securities lending program
conducted by the Fund's custodian.
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EXHIBIT I
TO THE
STATEMENT OF INVESTMENT POLICIES AND GUIDELINES OF
THE AGGRESSIVE OPPORTUNITIES FUND
MARCH 1, 1999
The following standards will be used to measure the performance of the
Aggressive Opportunities Fund:
A. BENCHMARKS
1. The performance benchmark for the Fund is the XXXXXXX 2000 INDEX.
This benchmark will be used to measure the Fund's performance net
of subadviser fees.
2. A peer group benchmark for the Fund will consist of mutual funds
with characteristics similar to the Fund. The peer group will be
used to measure the Fund's performance relative to other funds
with a similar investment approach. The peer group benchmark will
measure Fund performance net of all fees and expenses except for
the plan administration fee.
3. The Lipper Capital Appreciation Index, selected by Lipper
Analytical Services, will serve as the performance benchmark for
participant returns, net of all fees and expenses. In assessing
performance against this benchmark, it will be taken into
consideration that Lipper Analytical Services may change the
composition of the Index.
B. TIME HORIZON
The time horizon for performance measurement will be one, three, and five
years.
One Year:
Performance relative to any benchmark established for the Fund will vary
widely over one-year periods; such variance over short time periods is
expected and acceptable. However, if such variance is determined to be
caused by systemic issues, action may be appropriate.
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Three and Five Years:
Performance of the Fund should track market and universe benchmarks more
closely as the evaluation period lengthens. The ideal performance
objective for the Aggressive Opportunities Fund is to exceed the returns
of all relevant benchmarks; however, shortfalls over various time periods
should be expected in some cases. Underperformance against a single
benchmark over an extended period may be acceptable, particularly if
other benchmarks have been exceeded.
C. INVESTMENT CHARACTERISTICS
The Fund may have investment characteristics which differ from the
general market, as measured by the Standard & Poor's 500 Index. Because
of the broad mandate given to the subadvisers in the Aggressive
Opportunities Fund, investment characteristics may be expected to vary
widely. For the total Fund, these would include, but are not limited to:
CHARACTERISTIC RELATIVE TO S&P 500 INDEX
Beta Higher
Capitalization Lower
Dividend Yield Lower
Hist. 5 year EPS Growth Higher
Price to Earnings Ratio Higher
Standard Deviation Higher
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SCHEDULE B
VANTAGEPOINT INVESTMENT ADVISERS, LLC
AGGRESSIVE OPPORTUNITIES FUND
INVESTMENT GUIDELINES
FOR
TCW FUNDS MANAGEMENT, INC.
MARCH 1, 1999
TCW Fund Management, Inc. seeks to achieve superior returns through capital
appreciation from small- and mid-sized companies that exhibit rapid growth. The
portfolio is managed using a team approach. In addition to traditional
quantitative screens, fundamental research, and direct company visits, the team
identifies key non-earnings indicators referred to as "outcome drivers" to
select growth companies. These outcome drivers enable the team to evaluate
company performance without relying solely on earnings that may not always
presage future success for small rapidly growing companies. The portfolio tends
to remain fully invested at all times.
I. ELIGIBLE INVESTMENTS
A. EQUITY SECURITIES: Common stock, preferred stock, common stock
equivalents (units of beneficial interest), American Depository
Receipts, convertible preferred stocks, warrants, and other
rights.
B. CASH/CASH EQUIVALENTS: Fixed income obligations with maturities
less than one year, or short term accounts or securities managed
by the custodian institution.
C. FIXED INCOME: Fixed income and convertible fixed income securities
with maturities greater than one year.
D. ELIGIBLE INVESTMENT LIMITS:
MINIMUM NORMAL RANGE MAXIMUM
------- ------------ -------
Equity securities 80% 90%-100% 100%
Cash and cash equivalents 0% 0%-10% 15%
Fixed income securities 0% 0%-5% 10%
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II. PROHIBITED PRACTICES AND SECURITIES
A. Short sales.
B. Options.
C. Commodities (including financial futures).
D. Securities for which there is no established trading market.
E. Foreign securities unless listed and traded in the U.S.
F. Margin purchases and other forms of borrowing; granting of pledges
or other security interests in assets of the portfolio; use of
futures to obtain market leverage.
G. Securities offered by the Adviser or its affiliates.
H. General partner interests.
I. Direct investments in oil, gas, or other mineral exploration or
development programs.
J. Direct investments in real estate or interests in real estate;
this does not preclude investment in purchases of securities of
real estate investment trusts and other companies holding real
estate or interests in real estate.
K. Acquisition of securities of an issuer that would cause more than
5% of the portfolio at the time of purchase to be invested in such
securities.
L. Acquisition of more than 5% of the outstanding stock of any issuer
at the time of purchase.
M. Acquisition of securities that would cause exposure to a single
industry to exceed 25% of the portfolio at the time of purchase.
N. Commingled and registered mutual funds.
Exceptions to the above listed eligible investments and prohibited
securities or practices may be permitted with prior consent from VIA.
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III. SECURITIES AND PRACTICES NOT OTHERWISE MENTIONED
Any securities or practices not enumerated in Section I or Section II of
these Investment Guidelines may be acquired or employed, as the case may
be, but only if explicitly approved in advance by VIA.
IV. PERFORMANCE BENCHMARK AND MONITORING CRITERIA
The standards outlined in this section are subject to review by VIA as
and when appropriate.
A. PERFORMANCE BENCHMARKS
The market benchmark for measuring investment performance for the
Adviser is the XXXXXXX 2000 INDEX. The Adviser is expected to
outperform the benchmark net of Adviser fees over rolling three
and five-year periods.
B. PEER GROUPS
VIA will develop an appropriate peer group against which to
compare investment performance. The peer group will consist of
other managers with a similar investment approach. The managers
within the peer group will be reviewed periodically for
consistency of style and may be changed as and when deemed
appropriate by VIA. Such changes will be communicated to the
Adviser.
1. The peer group will consist primarily of mutual funds,
however separate account managers may be included.
2. VIA will track relative net-of-fee performance quarterly
and evaluate performance on a trailing one, three and
five-year basis.
3. VIA will compare the Adviser's net performance with the
one-year mean return of the peer group.
The current peer group consists of the following four managers:
Xxxxx XxxXxx Growth (AMCGX)
Xxxxxxxx-Xxxxxxxxx Growth Equity A (NAPGX)
Xxxxxx Vista A (PVISX)
X. Xxxx Price New American Growth (PRWAX)
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SCHEDULE B-I
VANTAGEPOINT INVESTMENT ADVISERS, LLC
GROWTH FUND
INVESTMENT GUIDELINES
FOR
TCW FUNDS MANAGEMENT, INC.
OCTOBER 1, 1999
TCW Funds Management, Inc. selects stocks of high quality companies with
long-term growth characteristics selling at attractive valuations in relation to
the fundamental prospects of the underlying companies. Companies chosen are
believed to have strong and enduring business strategies and inherent advantages
over their competitors. The manager also considers a company's prospects for
capitalizing on broad investment and economic trends, based on a top-down
appraisal of the US economy. The portfolio is moderately concentrated in
generally 20 to 40 holdings and is normally fully invested in equities at all
times.
I. ELIGIBLE INVESTMENTS
A. EQUITY SECURITIES: Common stock, preferred stock, common stock
equivalents (units of beneficial interest), American Depository
Receipts, convertible preferred stocks, warrants, and other
rights.
B. CASH/CASH EQUIVALENTS: Fixed income obligations with maturities
less than one year, or short term accounts or securities managed
by the custodian institution.
C. FIXED INCOME: Fixed income and convertible fixed income securities
with maturities greater than one year.
D. ELIGIBLE INVESTMENT LIMITS:
MINIMUM NORMAL RANGE MAXIMUM
------- ------------ -------
U.S. Equity securities 80% 90%-100% 100%
Non-U.S. Equity securities 0% 0%-5% 10%
Cash and cash equivalents 0% 0%-10% 15%
Fixed income securities 0% 0%-5% 10%
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II. PROHIBITED PRACTICES AND SECURITIES
O. Short sales.
P. Options.
Q. Commodities (including financial futures).
R. Securities for which there is no established trading market.
S. Foreign securities unless listed and traded in the U.S.
T. Margin purchases and other forms of borrowing; granting of pledges
or other security interests in assets of the portfolio; use of
futures to obtain market leverage.
U. Securities offered by the Adviser or its affiliates.
V. General partner interests.
W. Direct investments in oil, gas, or other mineral exploration or
development programs.
X. Direct investments in real estate or interests in real estate;
this does not preclude investment in purchases of securities of
real estate investment trusts and other companies holding real
estate or interests in real estate.
Y. Acquisition of securities of an issuer that would cause more than
7.5% of the portfolio at the time of purchase to be invested in
such securities.
Z. Acquisition of more than 5% of the outstanding stock of any
issuer.
AA. Acquisition of securities that would cause exposure to a single
industry to exceed 25% of the portfolio at the time of purchase.
BB. Commingled and registered mutual funds.
Exceptions to the above listed eligible investments and prohibited
securities or practices may be permitted with prior consent from VIA.
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III. SECURITIES AND PRACTICES NOT OTHERWISE MENTIONED
Any securities or practices not enumerated in Section I or Section II of
these Investment Guidelines may be acquired or employed, as the case may
be, but only if explicitly approved in advance by VIA.
IV. PERFORMANCE BENCHMARK AND MONITORING CRITERIA
The standards outlined in this section are subject to review by VIA as
and when appropriate.
A. PERFORMANCE BENCHMARKS
The market benchmark for measuring investment performance for the
Adviser is the STANDARD & POOR'S 500 INDEX. The Adviser is
expected to outperform the benchmark net of Adviser fees over
rolling three and five-year periods.
B. PEER GROUPS
VIA will develop an appropriate peer group against which to
compare investment performance. The peer group will consist of
other managers with a similar investment approach. The managers
within the peer group will be reviewed periodically for
consistency of style and may be changed as and when deemed
appropriate by VIA. Such changes will be communicated to the
Adviser.
4. The peer group will consist primarily of mutual funds, however
separate account managers may be included.
5. VIA will track relative net-of-fee performance quarterly and
evaluate performance on a trailing one, three and five-year basis.
6. VIA will compare the Adviser's net performance with the one-year
mean return of the peer group.
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SCHEDULE C
VANTAGEPOINT INVESTMENT ADVISERS, LLC
FEE SCHEDULE
FOR
TCW FUNDS MANAGEMENT INC.
The Adviser's quarterly fee shall be calculated based on the average daily
market value of the assets under management as provided by the Custodian, based
on the following annual rate.
First $25 million 0.70 percent
Next $25 million 0.50 percent
Next $50 million 0.45 percent
Next $400 million 0.40 percent
Over $500 million 0.35 percent
EXAMPLE OF QUARTERLY FEE CALCULATION (HYPOTHETICAL AMOUNTS)
January 1, 1999 $675,000,000 End-of-Day Market Value
January 2, 1999 $675,678,462 End-of-Day Market Value
January 3, 1999 $675,796,123 End-of-Day Market Value
. . .
March 29, 1999 $681,512,214 End-of-Day Market Value
March 30, 1999 $681,720,978 End-of-Day Market Value
March 31, 1999 $681,901,556 End-of-Day Market Value
Quarterly Daily Average $680,601,555
First $25 million 0.70 percent $175,000
Next $25 million 0.50 percent $125,000
Next $50 million 0.45 percent $225,000
Next $400 million 0.40 percent $1,600,000
Over $500 million 0.35 percent $632,105
- - - - - -
Annual Fee $2,757,105
One-Fourth Annual Fee $689,276
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