EX-99.B(d)-scima
INVESTMENT MANAGEMENT AGREEMENT
THIS AGREEMENT, made this 18th day of August, 1999, by and between UNITED SMALL
CAP FUND, INC. (hereinafter called "United"), and XXXXXXX & XXXX INVESTMENT
MANAGEMENT COMPANY,
WITNESSETH:
In consideration of the mutual promises and agreements herein contained and
other good and valuable consideration, the receipt of which is hereby
acknowledged, it is hereby agreed by and between the parties hereto as follows:
I. In General
Xxxxxxx & Xxxx Investment Management Company
agrees to act as investment adviser to United with respect to the investment of
its assets and in general to supervise the investments of United, subject at all
times to the direction and control of the Board of Directors of United, all as
more fully set forth herein.
II. Duties of Xxxxxxx & Xxxx Investment
Management Company with respect to investment of assets of United
X. Xxxxxxx & Xxxx Investment Management
Company shall regularly provide investment advice to United and shall, subject
to the succeeding provisions of this section, continuously supervise the
investment and reinvestment of cash, securities or other property comprising the
assets of the investment portfolios of United; and in furtherance thereof,
Xxxxxxx & Xxxx Investment Management Company shall:
1. obtain and evaluate pertinent
information about significant developments and economic, statistical and
financial data, domestic, foreign or otherwise, whether affecting the economy
generally or one or more of the portfolios of United, and whether concerning the
individual companies whose securities are included in one or more of United's
portfolios or the industries in which they engage, or with respect to securities
which Xxxxxxx & Xxxx Investment Management Company considers desirable for
inclusion in one or more of United's portfolios;
2. furnish continuously an
investment program for each of the portfolios of United;
3. determine what securities shall
be purchased or sold by United;
4. take, on behalf of United, all
actions which appear to Xxxxxxx & Xxxx Investment Management Company necessary
to carry into effect such investment programs and supervisory functions as
aforesaid, including the placing of purchase and sale orders.
X. Xxxxxxx & Xxxx Investment Management
Company shall make appropriate and regular reports to the Board of Directors of
United on the actions it takes pursuant to Section II.A. above. Any investment
programs furnished by Xxxxxxx & Xxxx Investment Management Company under this
section, or any supervisory function taken hereunder by Xxxxxxx & Xxxx
Investment Management Company shall at all times conform to and be in accordance
with any requirements imposed by:
1. the provisions of the Investment
Company Act of 1940 and any rules or regulations in force thereunder;
2. any other applicable provision
of law;
3. the provisions of the Articles
of Incorporation of United as amended from time to time;
4. the provisions of the Bylaws of
United as amended from time to time;
5. the terms of the registration
statement of United, as amended from time to time, under the Securities Act of
1933 and the Investment Company Act of 1940, including any supplements to the
prospectus(es) and statement of additional information contained in such
registration statement.
C. Any investment programs furnished by
Xxxxxxx & Xxxx Investment Management Company under this section or any
supervisory functions taken hereunder by Xxxxxxx & Xxxx Investment Management
Company shall at all times be subject to any directions of the Board of
Directors of United, its Executive Committee, or any committee or officer of
United acting pursuant to authority given by the Board of Directors.
III. Allocation of Expenses
The expenses of United and the expenses of
Xxxxxxx & Xxxx Investment Management Company in performing its functions under
this Agreement shall be divided into two classes, to wit: (i) those expenses
which will be paid in full by Xxxxxxx & Xxxx Investment Management Company as
set forth in subparagraph "A" hereof, and (ii) those expenses which will be paid
in full by United, as set forth in subparagraph "B" hereof.
A. With respect to the duties of Xxxxxxx &
Xxxx Investment Management Company under Section II above, it shall pay in full,
except as to the brokerage and research services acquired through the allocation
of commissions as provided in Section IV hereinafter, for (a) the salaries and
employment benefits of all employees of Xxxxxxx & Xxxx Investment Management
Company who are engaged in providing these advisory services; (b) adequate
office space and suitable office equipment for such employees; and (c) all
telephone and communications costs relating to such functions. In addition,
Xxxxxxx & Xxxx Investment Management Company shall pay the fees and expenses of
all directors of United who are affiliated with Xxxxxxx & Xxxx Investment
Management Company or an affiliated corporation and the salaries and employment
benefits of all officers of United who are affiliated persons of Xxxxxxx & Xxxx
Investment Management Company.
B. United shall pay in full for all of its
expenses which are not listed above (other than those assumed by Xxxxxxx & Xxxx
Investment Management Company or one of its affiliates in its capacity as
principal underwriter of the shares of United, as Shareholder Servicing Agent or
as Accounting Services Agent for United), including (a) the costs of preparing
and printing prospectuses and reports to shareholders of United, including
mailing costs; (b) the costs of printing all proxy statements and all other
costs and expenses of meetings of shareholders of United (unless United and
Xxxxxxx & Xxxx Investment Management Company shall otherwise agree); (c)
interest, taxes, brokerage commissions and premiums on fidelity and other
insurance; (d) audit fees and expenses of independent accountants and legal fees
and expenses of attorneys, but not of attorneys who are employees of Xxxxxxx &
Xxxx Investment Management Company or an affiliated company; (e) fees and
expenses of its directors not affiliated with Xxxxxxx & Xxxx, Inc.; (f)
custodian fees and expenses; (g) fees payable by United under the Securities Act
of 1933, the Investment Company Act of 1940, and the securities or "Blue-Sky"
laws of any jurisdiction; (h) fees and assessments of the Investment Company
Institute or any successor organization; (i) such nonrecurring or extraordinary
expenses as may arise, including litigation affecting United, and any
indemnification by United of its officers, directors, employees and agents with
respect thereto; (j) the costs and expenses provided for in any Shareholder
Servicing Agreement or Accounting Services Agreement, including amendments
thereto, contemplated by subsection C of this Section III. In the event that any
of the foregoing shall, in the first instance, be paid by Xxxxxxx & Xxxx
Investment Management Company, United shall pay the same to Xxxxxxx & Xxxx
Investment Management Company on presentation of a statement with respect
thereto.
X. Xxxxxxx & Xxxx Investment Management
Company, or an affiliate of Xxxxxxx & Xxxx Investment Management Company, may
also act as (i) transfer agent or shareholder servicing agent of United and/or
as (ii) accounting services agent of United if at the time in question there is
a separate agreement, "Shareholder Servicing Agreement" and/or "Accounting
Services Agreement," covering such functions between United and Xxxxxxx & Xxxx
Investment Management Company, or such affiliate. The corporation, whether
Xxxxxxx & Xxxx Investment Management Company, or its affiliate, which is the
party to either such Agreement with United is referred to as the "Agent." Each
such Agreement shall provide in substance that it shall go into effect, or be
amended, or a new agreement covering the same topics between United and the
Agent may be entered into, only if the terms of such Agreement, such amendment
or such new agreement have been approved by the Board of Directors of United,
including the vote of a majority of the directors who are not "interested
persons" as defined in the Investment Company Act of 1940, of either party to
the Agreement, such amendment or such new agreement (considering Xxxxxxx & Xxxx
Investment Management Company to be such a party even if at the time in question
the Agent is an affiliate of Xxxxxxx & Xxxx Investment Management Company), cast
in person at a meeting called for the purpose of voting on such approval. Such a
vote is referred to as a "disinterested director" vote. Each such Agreement
shall also provide in substance for its continuance, unless terminated, for a
specified period which shall not exceed two years from the date of its execution
and from year to year thereafter only if such continuance is specifically
approved at least annually by a disinterested director vote, and that any
disinterested director vote shall include a determination that (i) the
Agreement, amendment, new agreement or continuance in question is in the best
interests of United and its shareholders; (ii) the services to be performed
under the Agreement, the Agreement as amended, new agreement or agreement to be
continued are services required for the operation of United; (iii) the Agent can
provide services the nature and quality of which are at least equal to those
provided by others offering the same or similar services; and (iv) the fees for
such services are fair and reasonable in light of the usual and customary
charges made by others for services of the same nature and quality. Any such
Agreement may also provide in substance that any disinterested director vote may
be conditioned on the favorable vote of the holders of a majority (as defined in
or under the Investment Company Act of 1940) of the outstanding shares of each
class or series of United. Any such Agreement shall also provide in substance
that it may be terminated by the Agent at any time without penalty upon giving
United one hundred twenty (120) days' written notice (which notice may be waived
by United) and may be terminated by United at any time without penalty upon
giving the Agent sixty (60) days' written notice (which notice may be waived by
the Agent), provided that such termination by United shall be directed or
approved by the vote of a majority of the Board of Directors of United in office
at the time or by the vote of the holders of a majority (as defined in or under
the Investment Company Act of 1940) of the outstanding shares of each class or
series of United.
IV. Brokerage
(a) Xxxxxxx & Xxxx Investment Management
Company may select brokers to effect the portfolio transactions of United on the
basis of its estimate of their ability to obtain, for reasonable and competitive
commissions, the best execution of particular and related portfolio
transactions. For this purpose, "best execution" means prompt and reliable
execution at the most favorable price obtainable. Such brokers may be selected
on the basis of all relevant factors including the execution capabilities
required by the transaction or transactions, the importance of speed,
efficiency, or confidentiality, and the willingness of the broker to provide
useful or desirable investment research and/or special execution services.
Xxxxxxx & Xxxx Investment Management Company shall have no duty to seek advance
competitive commission bids and may select brokers based solely on its current
knowledge of prevailing commission rates.
(b) Subject to the foregoing, Xxxxxxx &
Xxxx Investment Management Company shall have discretion, in the interest of
United, to direct the execution of its portfolio transactions to brokers who
provide brokerage and/or research services (as such services are defined in
Section 28(e) of the Securities Exchange Act of 1934) for United and/or other
accounts for which Xxxxxxx & Xxxx Investment Management Company exercises
"investment discretion" (as that term is defined in Section 3(a)(35) of the
Securities Exchange Act of 1934); and in connection with such transactions, to
pay commission in excess of the amount another adequately qualified broker would
have charged if Xxxxxxx & Xxxx Investment Management Company determines, in good
faith, that such commission is reasonable in relation to the value of the
brokerage and/or research services provided by such broker, viewed in terms of
either that particular transaction or the overall responsibilities of Xxxxxxx &
Xxxx Investment Management Company with respect to the accounts for which it
exercises investment discretion. In reaching such determination, Xxxxxxx & Xxxx
Investment Management Company will not be required to attempt to place a
specified dollar amount on the brokerage and/or research services provided by
such broker; provided that Xxxxxxx & Xxxx Investment Management Company shall be
prepared to demonstrate that such determinations were made in good faith, and
that all commissions paid by United over a representative period selected by its
Board of Directors were reasonable in relation to the benefits to United.
(c) Subject to the foregoing provisions of
this Paragraph "IV," Xxxxxxx & Xxxx Investment Management Company may also
consider sales of United's shares and shares of investment companies distributed
by Xxxxxxx & Xxxx, Inc. or one of its affiliates, and portfolio valuation or
pricing services as a factor in the selection of brokers to execute brokerage
and principal portfolio transactions.
V. Compensation of Xxxxxxx & Xxxx Investment
Management Company
As compensation in full for services
rendered and for the facilities and personnel furnished under sections I, II,
and IV of this Agreement, United will pay to Xxxxxxx & Xxxx Investment
Management Company for each day the fee specified in Exhibit A hereto.
The amounts payable to Xxxxxxx & Xxxx
Investment Management Company shall be determined as of the close of business
each day; shall, except as set forth below, be based upon the value of net
assets computed in accordance with the Articles of Incorporation of United; and
shall be paid in arrears whenever requested by Xxxxxxx & Xxxx Investment
Management Company. In computing the value of the net assets of United, there
shall be excluded the amount owed to United with respect to shares which have
been sold but not yet paid to United by Xxxxxxx & Xxxx, Inc.
VI. Undertakings of Xxxxxxx & Xxxx Investment
Management Company; Liabilities
Xxxxxxx & Xxxx Investment Management Company
shall give to United the benefit of its best judgment, efforts and facilities in
rendering advisory services hereunder.
Xxxxxxx & Xxxx Investment Management Company
shall at all times be guided by and be subject to United's investment policies,
the provisions of its Articles of Incorporation and Bylaws as each shall from
time to time be amended, and to the decision and determination of United's Board
of Directors.
This Agreement shall be performed in
accordance with the requirements of the Investment Company Act of 1940, the
Investment Advisers Act of 1940, the Securities Act of 1933, and the Securities
Exchange Act of 1934, to the extent that the subject matter of this Agreement is
within the purview of such Acts. Insofar as applicable to Xxxxxxx & Xxxx
Investment Management Company, as an investment adviser and affiliated person of
United, Xxxxxxx & Xxxx Investment Management Company shall comply with the
provisions of the Investment Company Act of 1940, the Investment Advisers Act of
1940 and the respective rules and regulations of the Securities and Exchange
Commission thereunder.
In the absence of willful misfeasance, bad
faith, gross negligence or reckless disregard of obligations or duties hereunder
on the part of Xxxxxxx & Xxxx Investment Management Company, it shall not be
subject to liability to United or to any stockholder of United for any act or
omission in the course of or connected with rendering services thereunder or for
any losses that may be sustained in the purchase, holding or sale of any
security.
VII. Duration of this Agreement
This Agreement shall become effective at the
start of business on the date hereof and shall continue in effect, unless
terminated as hereinafter provided, for a period of one year and from
year-to-year thereafter only if such continuance is specifically approved at
least annually by the Board of Directors, including the vote of a majority of
the directors who are not parties to this Agreement or "interested persons" (as
defined in the Investment Company Act of 1940) of any such party, cast in person
at a meeting called for the purpose of voting on such approval, or by the vote
of the holders of a majority (as so defined) of the outstanding voting
securities of a series of United with respect to that series and by the vote of
a majority of the directors who are not parties to this Agreement or "interested
persons" (as so defined) of any such party, cast in person at a meeting called
for the purpose of voting on such approval.
VIII. Termination
This Agreement may be terminated by Xxxxxxx
& Xxxx Investment Management Company at any time without penalty upon giving
United one hundred twenty (120) days' written notice (which notice may be waived
by United) and may be terminated by United at any time without penalty upon
giving Xxxxxxx & Xxxx Investment Management Company sixty (60) days' written
notice (which notice may be waived by Xxxxxxx & Xxxx Investment Management
Company), provided that such termination by United shall be directed or approved
by the vote of a majority of the Board of Directors of United in office at the
time or by the vote of a majority (as defined in the Investment Company Act of
1940) of the outstanding voting securities of United. This Agreement shall
automatically terminate in the event of its assignment, the term "assignment"
for this purpose having the meaning defined in Section 2(a)(4) of the Investment
Company Act of 1940 and the rules and regulations thereunder.
IN WITNESS WHEREOF, the parties hereto have caused the foregoing instrument to
be executed by their duly authorized officers and their corporate seal to be
hereunto affixed, all as of the day and year first above written.
(Seal) UNITED SMALL CAP FUND, INC.
By: /s/ Xxxxx X. Xxx
----------------
Xxxxx X. Xxx, Vice President
ATTEST:
By: /s/ Xxxxxxx X. Xxxxxxxx
-----------------------
Xxxxxxx X. Xxxxxxxx, Assistant Secretary
(Seal) XXXXXXX & XXXX INVESTMENT
MANAGEMENT COMPANY
By: /s/ Xxxxxx X. Xxxxxxx
---------------------
Xxxxxx X. Xxxxxxx
Executive Vice President
ATTEST:
By: /s/ Xxxxx X. Xxx
----------------
Xxxxx X. Xxx, Secretary
EXHIBIT A TO INVESTMENT MANAGEMENT AGREEMENT
UNITED SMALL CAP FUND, INC.
FEE SCHEDULE
A cash fee computed each day on the net assets of the Fund at the annual rates
listed below:
Net Assets Fee
---------- ---
Up to $1 billion 0.85% of net assets
Over $1 billion and up to $2 billion 0.83% of net assets
Over $2 billion and up to $3 billion 0.80% of net assets
Over $3 billion 0.76% of net assets
