Exhibit (d)(2)
PORTFOLIO MANAGEMENT AGREEMENT
AGREEMENT made as of November 1, 2001 by and between CCM
Advisors, LLC, a limited liability company organized under the laws of the state
of Delaware (the "Adviser") and ________________________ , a
________________________ organized under the laws of ________________________
(the "Investment Manager"), on behalf of the ________________________ (the
"Portfolio"), a series of the CCM Advisors Portfolios (the "Trust"):
WHEREAS, the Trust is registered as an open-end management
investment company under the Investment Company Act of 1940, as amended (the
"1940 Act");
WHEREAS, the Trust issues shares of beneficial interest in the
Portfolio (the "Shares") registered under the 1940 Act pursuant to a
registration statement filed with the Securities and Exchange Commission (the
"SEC") on March 20, 2001, as amended from time to time (the "Registration
Statement");
WHEREAS, the Investment Manager is an investment adviser
registered under the Investment Advisers Act of 1940, as amended (the "Advisers
Act") and has filed notification filings under all applicable state securities
laws;
WHEREAS, the Adviser is employed by the Trust to act as
investment adviser for and to manage, or arrange for the management of, the
investment and reinvestment of the assets of the Portfolio, to the extent
requested by and subject to the supervision and control of, the Board of
Trustees of the Trust (the "Board");
WHEREAS, the Trust and the Adviser desire to retain the
Investment Manager to render investment advisory services to the Portfolio; and
WHEREAS, the Investment Manager is willing to provide investment
advisory services to the Portfolio, in the manner and on the terms and
conditions set forth below;
NOW, THEREFORE, in consideration of their mutual promises, the
Adviser and the Investment Manager agree as follows:
ARTICLE 1
EMPLOYMENT OF INVESTMENT MANAGER
1.1 The Adviser hereby employs the Investment Manager to
manage the investment and reinvestment of the assets of the Portfolio, to the
extent requested by and subject to the supervision and control of, the Adviser
and the Board for the period and upon the terms herein set forth.
1.2 The Investment Manager accepts such employment and
agrees during such period at its own expense to render such services, and to
assume the obligations herein set forth for the compensation herein provided.
1.3 The Investment Manager shall for all purposes be
deemed to be an independent contractor, and unless otherwise expressly provided
or authorized shall have no authority to act for or represent the Trust or the
Portfolio in any way or otherwise be deemed an agent of the Trust or the
Portfolio. Notwithstanding the foregoing, the Investment Manager shall, for the
purposes of this agreement, have authority to act as agent for the Portfolio,
subject to supervision by the Adviser and the Board.
1.4 The services of the Investment Manager herein
provided are not to be deemed exclusive and the Investment Manager shall be free
to render similar services or other services to others so long as its services
hereunder shall not be impaired thereby.
ARTICLE 2
DUTIES OF INVESTMENT MANAGER
2.1 INVESTMENT MANAGEMENT SERVICES.
(a) Subject to the general supervision of the Board and
the Adviser, the Investment Manager shall provide a continuous investment
program for the Portfolio and determine the composition of the assets of the
Portfolio, including determination of the purchase, retention or sale of the
securities, cash and other investments for the Portfolio. In performing these
duties, the Investment Manager shall:
(i) perform research and obtain and evaluate
pertinent economic, statistical, and financial data relevant to the investment
policies of the Portfolio as set forth in the Registration Statement;
(ii) seek out and implement specific investment
opportunities, consistent with any investment strategies approved by the Board;
(iii)take such steps as are necessary to implement
any overall investment strategies approved by the Board for the Portfolio,
including making and carrying out day-to-day decisions to acquire or dispose of
permissible investments, managing investments and any other property of the
Portfolio, and providing or obtaining such services as may be necessary in
managing, acquiring or disposing of investments;
(iv) regularly report to the Board with respect to
the implementation of any approved overall investment strategy and any other
activities in connection with management of the assets of the Portfolio,
including furnishing, within 60 days after the end of each calendar quarter, a
statement of all purchases and sales during the quarter and a schedule of
investments and other assets of the Portfolio as of the end of the quarter;
(v) maintain all required accounts, records,
memoranda, instructions or authorizations relating to the acquisition or
disposition of investments for the Portfolio; and
(vi) assist in determining each business day the
net asset value of the shares of the Portfolio in accordance with applicable
law.
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(b) The Investment Manager acknowledges that neither the
Adviser nor its employees shall be required to evaluate the merits of investment
selections or decisions made by the Investment Manager or be required to approve
the selections or decisions, or to confirm their compliance with applicable
investment policies and restrictions; these responsibilities being within the
duties of the Investment Manager.
(c) The Investment Manager's services shall be subject
always to the control and supervision of the Adviser and the Board, the
restrictions of the Declaration of Trust and Bylaws of the Trust, as amended
from time to time, the provisions of the 1940 Act, the statements relating to
the Portfolio's investment objective or objectives, investment policies and
investment restrictions as set forth in the then-current Registration Statement,
and any applicable provisions of the Internal Revenue Code of 1986, as amended
(the "Code"). The Adviser has furnished or will furnish the Investment Manager
with copies of the Registration Statement, Declaration of Trust, and Bylaws as
currently in effect and agrees during the continuance of this agreement to
furnish the Investment Manager with copies of any amendments or supplements
thereto before or at the time the amendments or supplements become effective.
The Investment Manager will be entitled to rely on all documents furnished by
the Adviser.
(d) The Investment Manager represents that it shall make
every effort to ensure that the Portfolio continuously qualifies as a Regulated
Investment Company under Subchapter M of the Code or any successor provision.
Except as instructed by the Board or the Adviser, the Investment Manager shall
also make decisions for the Portfolio as to the manner in which voting rights,
rights to consent to corporate action and any other rights pertaining to the
Portfolio's portfolio securities shall be exercised. Should the Board at any
time make any determination as to investment policy and notify the Investment
Manager thereof, the Investment Manager shall be bound by such determination for
the period, if any, specified in such notice or until similarly notified that
such determination has been revoked.
(e) In connection with the acquisition or disposition of
securities described in Section 2.1(a)(iii), the Investment Manager may place
orders for the purchase or sale of portfolio investments for the account of the
Portfolio with brokers or dealers selected by it and, to that end, the
Investment Manager is authorized as agents of the Portfolio to give instructions
to the custodian of the Portfolio as to deliveries of securities and payments of
cash for the account of the Portfolio. In connection with the selection of
brokers or dealers and the placing of purchase and sale orders with respect to
assets of the Portfolio, the Investment Manager is directed at all times to seek
to obtain the best combination of net price and execution under the
circumstances within the policy guidelines as set forth in the current
Registration Statement. Subject to this requirement and the provisions of the
Advisers Act, the 1940 Act, and other applicable provisions of law, the
Investment Manager may select brokers or dealers with which it, the Adviser or
the Portfolio is affiliated.
(f) In addition to seeking the best combination of net
price and execution under the circumstances, the Investment Manager may also
take into consideration research and statistical information and wire and other
quotation services provided by brokers and dealers to the Adviser and Investment
Manager. The Investment Manager is also authorized to effect individual
securities transactions at commission rates in excess of the minimum commission
rates available, if the Investment Manager determines in good faith that such
amount of
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commission is reasonable in relation to the value of the brokerage and research
services provided by such broker or dealer, viewed in terms of either that
particular transaction or Investment Manager's overall responsibilities with
respect to the Portfolio. The policies with respect to brokerage allocation,
determined from time to time by the Board are those disclosed in the
Registration Statement. The execution of such transactions shall not be deemed
to represent an unlawful act or breach of any duty created by this agreement or
otherwise. The Investment Manager periodically will evaluate the statistical
data, research and other investment services provided to it by brokers and
dealers. Such services may be used by the Investment Manager in connection with
the performance of its obligations under this agreement or in connection with
other advisory or investment operations including using such information in
managing its own accounts.
(g) Nothing in this agreement shall preclude the
aggregation of orders for sale or purchase of securities or other investments by
two or more series of the Trust or by the Trust and other accounts
(collectively, "Advisory Clients") managed by the Adviser or the Investment
Manager to the Portfolio, provided that: (i) the Adviser or Investment Manager's
actions with respect to the aggregation of orders for multiple Advisory Clients,
including the Portfolio, are consistent with the then-current positions in this
regard taken by the Securities and Exchange Commission or its staff through
releases, "no-action" letters, or otherwise; and (ii) the Adviser's policies
with respect to the aggregation of orders for multiple Advisory Clients have
been previously submitted and approved by the Board.
(h) The Investment Manager will advise the Adviser and,
if instructed by the Adviser, the Portfolio's custodian on a prompt basis each
day by electronic telecommunication of each confirmed purchase and sale of a
portfolio security specifying the name of the issuer, the full description of
the security including its class, amount or number of shares of the security
purchased or sold, the market price, the commission, government charges and
gross or net price, trade date, settlement date and identity of the clearing
broker. Under no circumstances may the Investment Manager or any affiliates of
the Investment Manager act as principal in a securities transaction with the
Portfolio or any other investment company managed by the Adviser unless (i)
permitted by an exemptive provision, rule or order under the 1940 Act and (ii)
upon obtaining prior approval of the securities transaction from the Adviser.
Any such transactions shall be reported quarterly to the Board.
(i) The Investment Manager shall inform the Adviser and
the Board on a current basis of changes in investment strategy or tactics or key
personnel. It shall also be the duty of the Investment Manager to furnish to the
Board such information as may reasonably be necessary for the Board to evaluate
this agreement or any proposed amendments thereto for the purposes of casting a
vote pursuant to Section 8.
ARTICLE 3
ALLOCATION OF CHARGES AND EXPENSES
3.1 The Investment Manager will bear its own costs of providing
services hereunder. Other than as specifically indicated herein the Investment
Manager shall not be responsible for the Portfolio's or the Adviser's expenses,
including, without limitation: the day to day expenses related to the operation
and maintenance of office space, facilities and equipment;
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expenses incurred in the organization of the Portfolio, including legal and
accounting expenses and certain costs of registering securities of the Portfolio
under federal securities law and qualifying for sale under state securities
laws; any share redemption expenses; expenses of portfolio transactions;
shareholder servicing costs; pricing costs; interest on borrowings by the
Portfolio; charges of the custodian and transfer agent, if any; cost of auditing
services; all taxes and fees; certain insurance premiums; investor services
(including allocable personnel and telephone expenses); the cost of paying
dividends and capital gains distributions and any extraordinary expenses,
including litigation costs in legal actions involving the Portfolio, or costs
related to indemnification of trustees, officers and employees of the Trust.
3.2 The Portfolio shall be free to retain at its expense other
persons to furnish it with any services whatsoever, including, without
limitation, statistical, factual or technical information or advice.
ARTICLE 4
COMPENSATION OF THE INVESTMENT MANAGER
4.l For the services to be rendered as provided herein, the
Adviser shall pay to the Investment Manager for each month of the Portfolio's
fiscal year on the last day of each such month a fee based upon the average
daily net assets of the Portfolio, as determined pursuant to the Portfolio's
Registration Statement, at the annual rate of ___________ of the Portfolio's
average daily net assets.
4.2 For the month and year in which this agreement becomes
effective or terminates there shall be an appropriate proration on the basis of
the number of days that the agreement is in effect during the month and year
respectively.
4.3 If the net asset value is not required to be determined on
any particular business day, then for the purpose of the foregoing computations,
the net asset value of a share as last determined shall be deemed to be the net
asset value of a share as of the close of business on that day.
4.4 In connection with purchases or sales of portfolio
securities for the account of the Portfolio, neither the Investment Manager nor
any officer, director, shareholder or other affiliate of the Investment Manager
shall: (i) act as agent and accept any compensation other than its compensation
provided for in this agreement, except in the course of such person's business
as an underwriter or broker; or (ii) act as broker and accept any commission,
fee, or other remuneration in excess of the limits prescribed in the 1940 Act
and the rules promulgated thereunder.
4.5 The Investment Manager agrees that in all matters relating
to the management of the investment of the assets of the Portfolio, it will act
in conformity with the Registration Statement, Declaration of Trust, and Bylaws
of the Trust then in effect.
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ARTICLE 5
LIMITATIONS OF LIABILITY
5.1 The Investment Manager shall give the Portfolio the benefit
of the Investment Manager's best judgment and efforts in rendering services
under this agreement; provided, that the Investment Manager shall not be liable
for any error of judgment or import of law, or for any loss suffered by the
Trust in connection with the matters to which this agreement relates, except
loss resulting from: (i) willful misfeasance, bad faith or gross negligence on
the part of the Investment Manager in the performance of its obligations and
duties under this agreement; (ii) its reckless disregard of its obligations and
duties under this agreement; or (iii) a breach of Section 2.1(d) of this
agreement.
ARTICLE 6
BOOKS AND RECORDS
6.1 The Investment Manager shall maintain separate books and
detailed records of all matters pertaining to the Portfolio (the "Portfolio's
Books and Records"), including without limitation a daily ledger of such assets
and liabilities relating thereto and brokerage and other records of all
securities transactions. The Investment Manager shall also require that its
Access Persons (as defined in the Investment Manager's Code of Ethics) provide
the Investment Manager with monthly reports of their personal securities
transactions. The Portfolio's Books and Records shall be available by overnight
delivery of copies or for telecopying without delay to the Adviser during any
day that the Portfolio is open for business.
6.2 The Investment Manager agrees that all books and records
which it maintains for the Portfolio are the property of the Trust and further
agrees to surrender promptly to the Trust any such books, records or information
upon the Trust's request. All such books and records shall be made available,
within five business days of a written request, to the Trust's accountants or
auditors during regular business hours at the Adviser's offices. The Trust or
its authorized representative shall have the right to copy any records in the
possession of the Investment Manager which pertain to the Trust. Such books,
records, information or reports shall be made available to properly authorized
government representatives consistent with state and federal law and/or
regulations. In the event of the termination of this agreement, all such books,
records or other information shall be returned to the Trust free from any claim
or assertion of rights by the Investment Manager.
6.3 The Investment Manager further agrees that it will not
disclose or use any records or information obtained pursuant to this agreement
in any manner whatsoever except as authorized in this agreement and that it will
keep confidential any information obtained pursuant to this agreement and
disclose such information only if the Trust has authorized such disclosure, or
if such disclosure is required by federal or state regulatory authorities.
ARTICLE 7
DURATION AND TERMINATION OF THIS AGREEMENT
7.1 This agreement shall not become effective unless and until
the later of the time at which it is approved by the Board, including a majority
of trustees who are not parties to
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this agreement or interested persons of any such party to this agreement, or the
time at which it is approved by a majority of the Portfolio's outstanding voting
securities as required by the 1940 Act. This agreement shall come into full
force and effect on the later of such two dates. The agreement shall continue in
effect for two years and shall thereafter continue in effect from year to year
so long as such continuance is specifically approved at least annually by: (i)
the Board, or by the vote of a majority of the Portfolio's outstanding voting
securities; and (ii) a majority of those trustees 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.
7.2 TERMINATION.
(a) This agreement may be terminated at any time, without
penalty, by vote of the Board or by vote of the holders of a majority of such
Portfolio's outstanding voting securities, or by the Adviser or Investment
Manager, on sixty (60) days' written notice to the other party.
(b) This agreement may be terminated at any time without
the payment of any penalty by vote of the Board in the event that it shall have
been established by a court of competent jurisdiction that the Investment
Manager or any officer or director of the Investment Manager has taken any
action which results in a breach of the covenants of the Investment Manager set
forth herein.
(c) This agreement shall automatically terminate in the
event of its assignment.
ARTICLE 8
AMENDMENTS TO THIS AGREEMENT
8.1 This agreement may be amended by the parties only if such
amendment is specifically approved by: (i) the vote of a majority of the
Portfolio's outstanding voting securities, and (ii) a majority of those trustees
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.
8.2 Notwithstanding anything herein to the contrary, this
agreement may be amended by the parties without the vote or consent of
shareholders of the Portfolio to supply any omission, to cure, correct or
supplement any ambiguous, defective or inconsistent provision hereof, or if they
deem necessary to conform this Agreement to the requirements of applicable
federal laws or regulations, but neither the Adviser or Investment Manager shall
be liable for failing to do so.
ARTICLE 9
NOTICES
9.1 Any notice shall be sufficiently given when sent by
registered or certified mail to the other party at the address of such party set
forth below or at such other address as such party may from time to time specify
in writing to the other party.
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If to the Investment Manager:
Attn: _______________________
If to the Adviser:
CCM Advisors, LLC
000 X. XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxxx X. Xxxxxxx
ARTICLE 10
MISCELLANEOUS PROVISIONS
10.1 OTHER RELATIONSHIPS. It is understood that the officers,
trustees, agents, shareholders and other affiliates of the Trust are or may be
interested in the Adviser or Investment Manager as officers, directors agents,
shareholders, affiliates or otherwise, and that the officers, directors,
shareholders, agents and other affiliates of the Adviser or Investment Manager
may be interested in the Trust otherwise than as a shareholders.
10.2 DEFINITIONS OF CERTAIN TERMS. The terms "assignment,"
"affiliated person" and "interested person", when used in this agreement, shall
have the respective meanings specified in the 1940 Act. The term "majority of
the outstanding voting securities" means the lesser of: (a) 67% or more of the
votes attributable to Shares of the Portfolio or the Trust, as appropriate,
present at a meeting if the holders of more than 50% of such votes are present
or represented by proxy; or (b) more than 50% of the votes attributable to
Shares of the Portfolio or the Trust, as appropriate.
10.3 APPLICABLE LAW.
(a) This agreement shall be construed and the provisions
hereof interpreted under and in accordance with the laws of Illinois without
regard to conflicts of law principles or precedents.
(b) This agreement shall be subject to the provisions of
the Securities Act of 1933, the 1940 Act and the Securities Exchange Act of
1934, and the rules and regulations and rulings thereunder, including such
exemptions from those statutes, rules and regulations as the SEC may grant and
the terms hereof shall be interpreted and construed in accordance therewith.
10.4 SEVERABILITY. If any provision of this agreement shall be
held or made invalid by a court decision, statute, rule or otherwise, the
remainder of this agreement shall not be affected thereby.
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10.5 CAPTIONS, The captions in this agreement are included for
convenience of reference only and in no way define or delineate any of the
provisions hereof or otherwise affect their construction or effect.
10.6 COUNTERPARTS. This agreement may be executed simultaneously
in multiple counterparts, each of which taken together shall constitute one and
the same instrument.
10.7 COOPERATION WITH AUTHORITIES. Each party hereto shall
cooperate with the other party and all appropriate governmental authorities
(including without limitation the SEC) and shall permit such authorities
reasonable access to its books and records in connection with any investigation
or inquiry relating to this agreement or the transactions contemplated hereby.
10.8 CUMULATIVE RIGHTS. The rights, remedies and obligations
contained in this agreement are cumulative and are in addition to any and all
rights, remedies and obligations, at law or in equity, which the parties hereto
are entitled to under state and federal laws.
10.9 COMPENSATION OF OFFICERS, TRUSTEES AND EMPLOYEES. No
Trustee, officer or employee of the Portfolio shall receive from the Portfolio
any salary or other compensation as a Trustee, officer or employee of the
Portfolio while at the same time holding a position as a director, officer,
partner, member or employee of the Investment Manager. This paragraph shall not
apply to consultants and other persons who are not regular members of the
Investment Manager's staff.
IN WITNESS WHEREOF, the parties hereto have caused this
agreement to be executed in their names and on their behalf by their duly
authorized officers all on the day and year first above written.
CCM ADVISORS, LLC
By:
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Title:
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By:
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Title:
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