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EXHIBIT (D) (XXIV)
STRATEGIC ALLOCATION FUND
OF
THE ENTERPRISE GROUP OF FUNDS, INC.
FUND MANAGER'S AGREEMENT
THIS AGREEMENT, made the 31st day of August 2001, is among The
Enterprise Group of Funds, Inc. (the "Fund"), a Maryland corporation, Enterprise
Capital Management, Inc., a Georgia corporation (hereinafter referred to as the
"Adviser"), and Xxxxxxx Advisors, Inc., a Delaware corporation (hereinafter
referred to as the "Fund Manager").
BACKGROUND INFORMATION
(A) The Adviser has entered into an Investment Adviser's Agreement
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 funds of the Fund, and the Fund
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 Fund Managers to the funds of the Fund.
(B) The parties hereto wish to enter into an agreement (the
"Agreement") whereby the Fund Manager will provide to the Strategic Allocation
Fund of the Fund (the " Strategic Allocation Fund") securities investment
advisory services for that Fund.
WITNESSETH THAT:
In consideration of the mutual covenants herein contained, the Fund,
Adviser and the Fund Manager agree as follows:
(1) The Fund and Adviser hereby employ the Fund Manager
to render certain investment advisory services to the Strategic Allocation Fund,
as set forth herein. The Fund 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 Fund Manager shall furnish the Strategic
Allocation Fund advice with respect to the investment and reinvestment of the
assets of the Strategic Allocation Fund, or such portion of the assets of the
Strategic Allocation Fund as the Adviser shall specify from time to time, in
accordance with the investment objectives, restrictions and limitations of the
Strategic Allocation Fund as set forth in the Fund's most recent Registration
Statement.
(3) The Fund Manager shall perform a monthly
reconciliation of the Strategic Allocation 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 Fund Manager shall for all purposes herein be
deemed to be an independent contractor. The Fund Manager has no authority to act
for or represent the Fund or the funds in any way except to direct securities
transactions pursuant to its investment advice hereunder. The Fund Manager is
not an agent of the Fund or the funds.
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(5) It is understood that the Fund Manager does not, by
this Agreement, undertake to assume or pay any costs or expenses of the Fund or
the funds, as set forth in the Fund's prospectus.
(6)(a) The Adviser agrees to pay as compensation to the
Fund Manager for its services to be furnished under this Agreement, with respect
to each calendar month after the effective date of this Agreement, on the
twentieth (20th) day after the close of each calendar month, a sum equal to
0.033 of 1% of the average of the daily closing net asset value of the Strategic
Allocation Fund managed by the Fund Manager during such month (that is, 0.40 of
1% per year) for the first $100,000,000 of assets under management, and a sum
equal to 0.029 of 1% of the average of the daily closing net asset value of the
Strategic Allocation Fund during such month (that is, 0.35 of 1% per year)
thereafter.
(6)(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.
(6)(c) For the purposes of this Paragraph 6, the daily
closing net asset values of the Strategic Allocation Fund 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 Strategic Allocation Fund's shares.
(7) The services of the Fund Manager hereunder are not to
be deemed to be exclusive, and the Fund 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 Fund Manager of its
responsibilities hereunder, it is agreed that the Fund 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. The Fund Manager may, from time to time hereafter, act as investment
adviser to one or more other investment companies and fiduciary or other managed
accounts, provided that when the Fund Manager purchases or sells securities of
the same issuer on behalf of two or more advisory clients the available
securities will be allocated in a manner believed by the Fund Manager to be
equitable to each client.
(8) 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 Fund Manager shall not be
liable to the Fund, the Strategic Allocation Fund or the Adviser or to any
shareholder or shareholders of the Fund, the Strategic Allocation Fund 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 Fund Manager hereunder.
(9) The Fund Manager represents that it has, in
accordance with Rule 17j-1 under the Investment Company Act of 1940 ("Investment
Company Act"), adopted a Code of Ethics that includes procedures designed to
prevent investment professionals, including those who are responsible for
managing the portfolio of the Strategic Allocation Fund, from engaging in any
personal investing activity that may operate to defraud Fund Managers' mutual
fund clients.
(10) In connection with the management of the investment
and reinvestment of the assets of the Strategic Allocation Fund, the Fund
Manager is authorized to select the brokers or dealers that will execute
purchase and sale transactions for the Strategic Allocation Fund, and is
directed to use its best efforts to obtain the most favorable execution with
respect to such purchases and sales of fund securities for the Strategic
Allocation Fund. Subject to this primary requirement, and maintaining as its
first consideration the benefits for the Strategic Allocation Fund and its
shareholders, the Fund Manager
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shall have the right to follow a policy of selecting brokers and dealers who
furnish statistical research and other services to the Strategic Allocation
Fund, the Adviser, or the Fund Manager and, subject to the Conduct Rules of the
National Association of Securities Dealers, Inc., to select brokers and dealers
who sell shares of funds of the Fund.
(11) The Fund may terminate this Agreement by thirty (30)
days written notice to the Adviser and the Fund Manager at any time, without the
payment of any penalty, by vote of the Fund's Board of Directors, or by vote of
a majority of its outstanding voting securities. The Adviser may terminate this
Agreement by thirty (30) days written notice to the Fund Manager and the Fund
Manager may terminate this Agreement by thirty (30) days written notice to the
Adviser, without the payment of any penalty. This Agreement shall immediately
terminate in the event of its assignment.
(12) Subject to prior termination as provided above, this
Agreement shall continue in force from the date of execution until August 31,
2003 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 Directors of the Fund, including a majority of those
Directors 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 Directors of the Strategic Allocation 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.
(13) The Adviser shall indemnify and hold harmless the
Fund Manager, its officers and directors and each person, if any, who controls
the Fund Manager within the meaning of Section 15 of 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
from the Indemnified Party's performance or non-performance of any duties under
this Agreement. 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 Fund 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 Fund Manager or such
controlling persons.
The Fund Manager shall indemnify and hold harmless
the Adviser and each of its directors 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 that results from
the Fund Manager's willful misfeasance, bad faith or gross negligence in the
performance of its duties under this Fund 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 Fund Manager, the Fund
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
Fund Manager by the provisions of subsection (i) and (ii) of this section.
(14) The Adviser agrees that no marketing materials that
include a reference to the Fund Manager will be used by the Adviser with respect
to the Fund unless first provided to the Adviser by the Fund Manager or unless
the Adviser has obtained the Fund Manager's prior written approval.
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(15) Except as otherwise provided in paragraph 13 hereof
and as may be required under applicable federal law, this Fund Manager's
Agreement shall be governed by the laws of the State of Georgia.
(16) In the event of a change in control that results in
an assignment as defined by the Investment Company Act of 1940, the Fund Manager
agrees to notify the parties within a reasonable period of time.
(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 Fund Manager:
Xxxxxxx Advisors, Inc.
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxx Xxxxx
by the Adviser: Enterprise Capital Management, Inc.
0000 Xxxxxxxxx Xxxx, X.X., Xxxxx 000
Xxxxxxx, XX 00000-0000
Attn: Xxxxxxx X. Xxxxxxxxxx
by the Fund: The Enterprise Group of Funds, Inc.
c/o Enterprise Capital Management, Inc.
0000 Xxxxxxxxx Xxxx, X.X., Xxxxx 000
Xxxxxxx, XX 00000-0000
Attn: Xxxxxxxxx X. XxXxxxxxx
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 Fund Manager, the Adviser and the Fund relating to the Strategic
Allocation Fund.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be signed
by their duly authorized officers and their corporate seals hereunder duly
affixed and attested, as of the date first above written.
THE ENTERPRISE GROUP OF FUNDS, INC.
ATTEST: /s/ XXXXXXXXX X XXXXXXXXX By: /s/ XXXXXX XXXXXX
-------------------------- -------------------------------------
Xxxxxxxxx X. XxXxxxxxx Xxxxxx Xxxxxx, Chairman, President
Secretary and Chief Executive Officer
ENTERPRISE CAPITAL MANAGEMENT, INC.
ATTEST: /s/ XXXXXXXXX X XXXXXXXXX By: /s/ XXXXXX XXXXXX
-------------------------- -------------------------------------
Xxxxxxxxx X. XxXxxxxxx Xxxxxx Xxxxxx, Chairman, President
Secretary and Chief Executive Officer
XXXXXXX ADVISORS, INC.
ATTEST: By: /s/ XXXXX X XXXXXX
-------------------------- -------------------------------------
Secretary Xxxxx X. Xxxxxx, President and
Chief Executive Officer
