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Exhibit 10.6
MANAGEMENT AGREEMENT
LIFE COMPANIES
This AGREEMENT, made as of this __________ day of March, 1997, by
and between each of the companies listed in the signature block below,
individually and in no case jointly (each such company being hereinafter
individually referred to as the "Client"), and HARTFORD INVESTMENT SERVICES,
INC., a corporation organized pursuant to the laws of the State of Connecticut
(the "Manager").
WITNESSETH:
WHEREAS, Client has an obligation to invest its assets in order to meet
the obligations of its policyholders; and
WHEREAS, from time to time Client seeks investment services from
various investment advisers to provide investment management services; and
WHEREAS, Manager is in the business of providing investment management
services; and
WHEREAS, Client wishes to appoint Manager to serve as investment
manager with respect to a portion of Client's assets and the Manager is willing
to so serve;
NOW, THEREFORE, in consideration of the mutual covenants contained
herein, the parties hereto agree as follows:
1) APPOINTMENT OF MANAGER
Effective as of the__ day of March, 1997, and until this appointment is
terminated as provided in Paragraph 8 hereof, the Client hereby appoints
the Manager as an investment manager and delegates to the Manager the power
to manage (including the power to acquire or dispose of), in accordance
with the terms and conditions of this Agreement, that
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portion of the assets of the Client which constitute, from time to time,
one or more accounts established by Client from time to time (each such
account is hereinafter individually referred to as an "Account" and are
collectively referred to as the "Accounts"). The "Account" shall mean all
invested assets of the Client unless otherwise agreed to by Manager
including client's general accounts and guaranteed separate accounts
("Invested Assets"), any non-guaranteed separate account assets of Client,
such as accounts which are not in compliance with performance reporting
standards provided by the Association for Investment Management Research,
deposited into an account established under this Agreement and funds that
are available for investment by Manager ("Available Funds") of the Client
which by notice given or caused to be given by the Client to the Manager,
are placed in the Account, and the investments and reinvestments of, and
all income earned by, any assets from time to time in the Account. The list
of initial accounts is attached as Schedule 1. By notice given or caused to
be given by the Client to the Manager, assets of the Client may be added to
or withdrawn from the Account(s), provided, however, that with regard to
assets withdrawn by the Client under this Paragraph 1, Client may not
engage the investment advisory services of any investment adviser which is
not affiliated with Manager without Manager's prior written approval.
2) INVESTMENT DIRECTION
Client hereby directs the Manager to use its best efforts to select
investments for the Account(s) in compliance with Client's Investment
Policy supplied to and agreed to by Manager in writing. Client may change
the Investment Policy at any time, but Manager will be bound by the changes
only after it has received and agreed to them in writing. The
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Client understands and is willing to accept the risk involved therein and
further understands that there can be no assurance that such objectives
will be achieved.
Client shall keep Manager fully and promptly informed of its business
operations, including all relevant management information, for example
actual and projected cash flow, balance sheet and income related data,
non-investment cash needs, liabilities, factors affecting income taxes,
capital position and state deposit requirements. In addition, Client shall
supply Manager with any other information deemed relevant by Client or
Manager for the development and operation of Client's Investment Policy.
3) CUSTODY, DELIVERY AND RECEIPT OF SECURITIES
The Manager will be responsible for the establishment and maintenance of
proper arrangements regarding the custody of the securities and other
assets in the Account(s) and the delivery and receipt of such securities
and other assets.
4) AUTHORITY OF THE MANAGER
The Manager is hereby authorized on behalf of the Client, as its agent and
attorney-in-fact, without obtaining the consent of or consulting with the
Client or any other person, to issue to brokers and dealers instructions to
purchase, sell and otherwise trade in or deal with, any security in the
Account(s) for the account and at risk of, and in the name of, the Client;
to purchase from or sell to any person any security in the Account(s) for
the account and at risk of, and in the name of the Client; and generally to
perform any other act necessary to
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enable the Manager to carry out its obligations under this Agreement. Such
authorization, however, does not include authority to deliver or pay
securities or cash to the Manager.
Manager will arrange for securities transactions for the Account to be
executed through those brokers, dealers or banks that Manager believes will
provide best execution. In choosing a broker, dealer or bank, Manager will
consider the broker, dealer or bank's execution capability, reputation and
access to the markets for the securities being traded for the Account.
Manager will seek competitive commission rates, but not necessarily the
lowest rates available.
Manager may also send transactions for the Account to brokers who charge
higher commissions than other brokers, provided that Manager determines in
good faith that the amount of commissions Manager pays is reasonable in
relation to the value of the brokerage and research services provided,
viewed in terms either of that particular transaction or Manager's overall
responsibilities with respect to all clients whose accounts Manager manages
on a discretionary basis.
5) DOCUMENTATION TO BE FURNISHED
The Client hereby agrees to furnish the Manager with such information,
authorizations and documentation as the Manager may from time to time
require to enable it to carry out its obligations under this Agreement.
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The Manager shall furnish to the Client such information and documentation
in such form as the Client from time to time may reasonably require,
including such information to permit the Client to independently assess
Manager's compliance with Client's Investment Policy.
6) COMPENSATION TO MANAGER
As compensation for services Manager renders to Client pursuant to this
Agreement and while this agreement is in effect, Manager shall charge
Client and Client shall pay Manager quarterly fees in arrears, within 30
business days after the close of each calendar quarter, the equivalent of
all indirect and direct costs incurred by the Manager during the relevant
period (the "Cost Reimbursement Amount"). The Cost Reimbursement Amount
will be established by Manager and provided to Client within a reasonable
time period following the end of each such calendar quarter.
7) SUB-ADVISORY SERVICES; ASSIGNMENT
If Manager at any time deems it to be in the best interest of Client,
Manager may designate and engage the services of a sub-adviser or
sub-advisers and may apportion to such sub-adviser(s) a portion of the
assets of Client described in Paragraph 1. above as Manager shall determine
in its absolute discretion after consultation with Client. The designation
of an additional investment adviser(s) and the apportionment of any of
Client's assets to any such investment adviser(s) pursuant to this
Paragraph 7. shall not modify the respective rights and obligations of
Client and Manager hereunder.
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No assignment (as that term is defined in the Investment Advisers Act of
1940) of this Agreement shall be made by the Manager without the consent of
the Client, such consent not to be unreasonably withheld. Notwithstanding
anything contained in the immediately preceding sentence to the contrary,
Manager may assign its rights and obligations under this Agreement to any
of its affiliates which perform investment advisory services without
Client's prior consent.
8) TERMINATION
This Agreement shall run for an initial period beginning on March__, 1997
and ending on March__, 2000 (the "Initial Period") unless terminated by
Client upon one hundred and eighty (180) calendar days prior written notice
for "cause", as such term is defined below. Thereafter, this Agreement
shall be renewable automatically for successive one year periods on March__
("Successive One Year Period"), unless on or after September__, 1999, one
party gives to the other party one hundred and eighty (180) calendar days
prior written notice of its intention to terminate the Agreement. A
termination for "cause" shall be defined as Manager substantially
underperforming certain benchmarks agreed to by Client and Manager relating
to the management of Client's assets under this Agreement during the
Initial Period. For purposes of determining whether Manager has
substantially underperformed at any time during the Initial Period, Client
and Manager shall take into account the following: (i) any "extraordinary
expenses" incurred by Manager during the relevant period, determined in
accordance with generally accepted accounting principals, (ii) any errors
committed or caused by a custodian, broker, dealer, bank or futures
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commission merchant which Manager directs transactions for the Account or
any other person, and (iii) any losses caused by following Client's
directions or instructions.
If Client terminates this Agreement during or at the expiration of either
the Initial Period or any Successive One Year Period, Client acknowledges
and agrees that it shall be obligated to pay to Manager any and all costs
attributable to, arising from or related to such termination.
9) DUTY AND LIABILITY OF THE MANAGER
Unless the Manager has not acted prudently or has otherwise violated the
provisions of applicable law, the Manager shall not be subject to any
liability to the Client or to any other person, firm or organization in the
course of, or connected with its obligations under this Agreement. The
Manager shall have no obligation to seek any material non-public ("inside")
information about any issuer of securities, and shall not purchase or sell,
or recommend for purchase or sale, the securities of any issuer for the
Account(s) the basis of any such information as may come into its
possession. Nothing herein shall in any way constitute a waiver or
limitation of any right of any person under the federal securities law.
10) SERVICE TO OTHER CLIENTS
It is understood that the Manager and its affiliates perform investment
advisory services for various clients (including investment companies). The
Client agrees that the Manager may give advice and take action with respect
to any of its other clients which may differ from advice given or the
timing or nature of action taken with respect to the Account(s), so long
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as it is the Manager's policy, to the extent practical, to allocate
investment opportunities to the Account(s) over a period of time on a fair
and equitable basis relative to other clients. It is understood that the
Manager shall not have any obligation to purchase or sell, or to recommend
for purchase or sale, for the Account(s) any securities which its
principals, affiliates or employees may purchase or sell for its or their
own accounts or for the account of any other client, if in the opinion of
the Manager such transaction or investment appears unsuitable, impractical
or undesirable for the Account.
11) NOTICES
Any notice, direction, instruction, acknowledgment, or other communication
required or contemplated by this Agreement shall be in writing and
addressed as follows:
To a Client listed on Schedule 1:
______________________________ [Relevant Company]
______________________________ [Address]
Attention: ______________________________ [Name of Officer]
______________________________ [Title of Officer]
To the Manager: Hartford Investment Services, Inc.
000 Xxxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Xx. Xxxxxx X. Xxxxxx
President
Any party hereto by notice hereunder to the other may designate a different
address.
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12) GOVERNING LAW
The laws of the State of Connecticut shall control all matters relating to
this Agreement and shall apply to the extent not preempted by the laws of
the United States of America.
13) VOTING OF PROXIES
Manager will execute or cause to be executed proxies received by the
custodian bank from issuers of securities being held in the Account(s). The
voting of such proxies shall be cast in a manner which is in the best
interest of the Account(s). Further, copies of all proxies, proxy
solicitation materials and other notices and written communications
relating to such securities ("Proxy Information") shall be retained by the
Manager for the Client hereunder. Client shall have access to such Proxy
Information, including the delivery of such information by Manager to
Client upon request.
14) RECORD KEEPING
Manager agrees that all records which it maintains for the Account shall be
the property of the Client and that it will surrender promptly to the
designated officers or employees of the Client any or all such records upon
request. All such records shall be made available, within a mutually
agreeable time upon request by Client, to the Client or to Client's
accountants or auditors during regular business hours at the Manager's
offices upon reasonable prior written notice; provided, however, that the
Manager shall be permitted to keep such records or copies thereof for such
period of time as are necessary to comply with all applicable rules and
regulations of state or federal law.
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15) CONFIDENTIAL INFORMATION
All information and advice furnished by the Manager to the Client shall be
treated as confidential and shall not be disclosed to third parties by
Client except as required by law or rule or regulation of any federal or
state regulatory or supervisory body, exchange or board. All information
identified by Client as proprietary shall be treated as confidential and
shall not be disclosed to the public by the Manager, except as required by
law or regulation or in order for the Manager to carry out its
responsibilities hereunder.
16) INDEPENDENT CONTRACTOR
The Manager shall for all purposes herein be deemed to be an independent
contractor and shall, unless otherwise expressly provided herein or
authorized, have no authority to act for or represent the Client in any
way.
17) MISCELLANEOUS
This Agreement may be executed in two or more counterparts, each of which
shall be considered as an original. Where the context admits, words in the
plural shall include the singular and the singular shall include the
plural. This Agreement contains the entire agreement between the parties
with respect to the subject matter hereof and may not be modified orally.
If any provision of this Agreement is held to be illegal, invalid or
unenforceable under present or future law, such provision shall by fully
severable, and this Agreement shall be construed and enforced as if such
illegal, invalid or unenforceable provision had never comprised a part of
this Agreement, and the remaining provisions of
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this Agreement shall remain in full force and effect and shall not be
affected by the illegal, invalid or unenforceable provision or its
severance from this Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective duly authorized officers on the date first above
written.
HARTFORD LIFE AND ACCIDENT INSURANCE COMPANY
ALPINE LIFE INSURANCE COMPANY
HARTFORD LIFE INSURANCE COMPANY
ITT HARTFORD LIFE AND ANNUITY INSURANCE CO.
ITT HARTFORD INTERNATIONAL LIFE REASSURANCE CORP.
By:_____________________________________________
Name: Xxxxxxx X. Xxxxx
Title: Vice President
HARTFORD INVESTMENT SERVICES, INC.
By:_____________________________________________
Name: Xxxxxx X. Xxxxxx
Title: President
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POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS THAT __________________________, a
corporation organized and existing under the laws of the State of ____________,
and having its principal place of business in ____________, ____________, does
hereby constitute and appoint HARTFORD INVESTMENT SERVICES, INC. of Hartford,
Connecticut, its true and lawful attorney for it and in its name and stead to:
(i) to buy, sell, assign, transfer and deliver or accept stocks, bonds, notes,
mortgages, certificates and other securities; (ii) to make, endorse, execute and
deliver under corporate seal of _______________________ any and all contracts,
assignments, transfers and other instruments necessary or proper to effect the
authority hereby conferred; and (iii) to open and maintain such bank accounts as
are necessary and proper to effect the authority hereby conferred; provided,
however, that all such authority shall be exercised pursuant to the terms of
that certain Management Agreement between ____________________ and Hartford
Investment Services, Inc. dated March __, 1997, the said _______________ hereby
ratifying and confirming all that the said attorney shall lawfully do or cause
to be done by virtue hereof.
IN WITNESS WHEREOF, __________________________ has caused its corporate
name to be signed by its ________________________ and its corporate seal to be
affixed and attested by its (Assistant) Secretary, all being done on this ___
day of March, 1997.
ATTEST: ________________________________________
INSURANCE COMPANY
_____________________________ By:_____________________________________
(Assistant) Secretary Name:
Title:
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SCHEDULE 1
Hartford Life and Accident Insurance Co.
Alpine Life Insurance Company
Hartford Life Insurance Company
ITT Hartford Life and Annuity Insurance Company
ITT Hartford International Life Reassurance Corporation
