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Exhibit d
INVESTMENT ADVISORY AGREEMENT
AGREEMENT made the 27th day of October, 1999, by and between USALLIANZ
FUNDS, a Delaware business trust (the "Trust"), and Allianz of America, Inc., a
Delaware corporation (the "Adviser").
WHEREAS, the Trust and the Adviser wish to enter into an Agreement
setting forth the terms on which the Adviser will perform certain services for
the Trust, its series of shares as listed on Schedule A to this agreement and
each series of shares subsequently issued by the Trust (each singly a "Fund" or
collectively the "Funds").
THEREFORE, in consideration of the promises and the mutual agreements
hereinafter contained, the Trust and the Adviser agree as follows:
1. (a) The Trust hereby employs the Adviser to manage the investment
and reinvestment of the assets of each Fund of the Trust in conformity with such
Fund's investment objectives and restrictions as may be set forth from time to
time in the Fund's then current prospectus and statement of additional
information, if any, and other governing documents, and to supervise the
provision of services to the Trust and each of its Funds by others, all subject
to the supervision of the Board of Trustees of the Trust, for the period and on
the terms set forth in this Agreement. The Adviser hereby accepts such
employment and agrees during such period, at its own expense, to render the
services and to assume the obligations set forth herein, for the compensation
provided herein. The Adviser shall for all purposes herein be deemed to be an
independent contractor and shall, unless otherwise expressly provided or
authorized, have no authority to act for or represent the Trust in any way or
otherwise be deemed an agent of the Trust.
(b) In the event that the Trust establishes one or more Funds, in
addition to the Funds listed on Schedule A, for which it wishes the Adviser to
perform services hereunder, it shall notify the Adviser in writing. If the
Adviser is willing to render such services, it shall notify the Trust in writing
and upon execution of an addendum hereto such Fund shall become a Fund hereunder
and the compensation payable to the Adviser by the new Fund will be as agreed in
writing at the time and set forth in such addendum.
2. The Adviser shall place all orders for the purchase and sale of
portfolio securities for the account of each Fund with broker-dealers selected
by the Adviser. In executing portfolio transactions and selecting
broker-dealers, the Adviser will use its best efforts to seek best execution on
behalf of each Fund. In assessing the best execution available for any
transaction, the Adviser shall consider all factors it deems relevant, including
the breadth of the market in the security, the price of the security, the
financial condition and execution capability of the broker-dealer, the
reasonableness of the commission, if any (all for the specific transaction and
on a continuing basis). In evaluating the best execution available, and in
selecting the broker-dealer to execute a particular transaction, the Adviser may
also consider the brokerage and research services (as those terms are used in
Section 28(e) of the Securities Exchange Act of 1934 (the "1934 Act")) provided
to a Fund and/or other accounts over which the Adviser or an affiliate of the
Adviser exercises investment discretion. The Adviser is authorized to pay a
broker-dealer
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who provides such brokerage and research services a commission for executing a
portfolio transaction for a Fund which is in excess of the amount of commission
another broker-dealer would have charged for effecting that transaction if, but
only if, the Adviser determines in good faith that such commission was
reasonable in relation to the value of the brokerage and research services
provided by such broker-dealer viewed in terms of that particular transaction or
in terms of all of the accounts over which investment discretion is so
exercised.
3. To the extent not otherwise arranged by the Trust pursuant to other
agreements for management, administration and/or other services, the Adviser, at
its own expense, shall furnish to the Trust office space in the offices of the
Adviser or in such other place as may be agreed upon by the parties from time to
time, all necessary office facilities, equipment and personnel in connection
with its services hereunder, and shall arrange, if desired by the Trust, for
members of the Adviser's organization to serve without salaries from the Trust
as officers or, as may be agreed from time to time, as agents of the Trust. The
Adviser assumes and shall pay or reimburse the Trust for:
(a) the compensation (if any) of the Trustees of the Trust who are
affiliated with the Adviser or with its affiliates, or with any adviser retained
by the Adviser, and of all officers of the Trust affiliated with the Adviser or
any of its affiliates, and
(b) all expenses of the Adviser incurred in connection with its
services hereunder.
The Trust assumes and shall pay all other expenses of the Trust and its
Funds, including, without limitation:
(c) all charges and expenses of any custodian or depository appointed
by the Trust for the safekeeping of the cash, securities and other property of
any of its Funds;
(d) all charges and expenses for administration and management services
(except as otherwise specifically provided in Section 1(a) hereof;
(e) all charges and expenses for bookkeeping and auditors;
(f) all charges and expenses of any transfer agents and registrars
appointed by the Trust;
(g) all fees of all Trustees of the Trust who are not affiliated with
the Adviser or any of its affiliates, or with any adviser retained by the
Adviser;
(h) all brokers' fees, expenses, and commissions and issue and transfer
taxes chargeable to a Fund in connection with transactions involving securities
and other property to which the Fund is a party;
(i) all costs and expenses of distribution of shares of its Funds
incurred pursuant to Plans of Distribution adopted under Rule 12b-1 under the
Investment Company Act of 1940 ("1940 Act");
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(j) all costs and expenses of shareholder servicing;
(k) all taxes and trust fees payable by the Trust or its Funds to
Federal, state, or other governmental agencies;
(l) all costs of certificates representing shares of the Trust or its
Funds;
(m) all fees and expenses involved in registering and maintaining
registrations of the Trust, its Funds and of their shares with the Securities
and Exchange Commission (the "Commission") and registering or qualifying the
Funds' shares under state or other securities laws, including, without
limitation, the preparation and printing of registration statements,
prospectuses, and statements of additional information for filing with the
Commission and other authorities;
(n) expenses of preparing, printing, and mailing prospectuses and
statements of additional information to shareholders of each Fund of the Trust;
(o) all expenses of shareholders' and Trustees' meetings and of
preparing, printing, and mailing notices, reports, and proxy materials to
shareholders of the Funds;
(p) all charges and expenses of legal counsel for the Trust and its
Funds and for Trustees of the Trust in connection with legal matters relating to
the Trust and its Funds, including, without limitation, legal services rendered
in connection with the Trust and its Funds' existence, trust, and financial
structure and relations with its shareholders, registrations and qualifications
of securities under Federal, state, and other laws, issues of securities,
expenses which the Trust and its Funds has herein assumed, whether customary or
not, and extraordinary matters, including, without limitation, any litigation
involving the Trust and its Funds, its Trustees, officers, employees, or agents;
(q) all charges and expenses of filing annual and other reports with
the Commission and other authorities; and
(r) all extraordinary expenses and charges of the Trust and its Funds.
In the event that the Adviser provides any of these services or pays
any of these expenses, the Trust and any affected Fund will promptly reimburse
the Adviser therefor.
The services of the Adviser to the Trust and its Funds hereunder are
not to be deemed exclusive, and the Adviser shall be free to render similar
services to others.
4. As compensation for the Adviser's services to the Trust with respect
to each Fund during the period of this Agreement, the Trust will pay to the
Adviser a fee at the annual rate set forth on Schedule A for such Fund.
The Adviser's fee is computed as of the close of business on each
business day.
A pro rata portion of the Trust's fee with respect to a Fund shall be
payable in arrears at the end of each day or calendar month as the Adviser may
from time to time specify to the Trust. If and when this Agreement terminates,
any compensation payable
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hereunder for the period ending with the date of such termination shall be
payable upon such termination. Amounts payable hereunder shall be promptly paid
when due.
The Adviser may from time to time and for such periods as it deems
appropriate reduce its compensation (and, if appropriate, assume expenses of one
or more of the Funds) to the extent that any Fund's expenses exceed such lower
expense limitation as the Adviser may, by notice to the Trust, voluntarily
declare to be effective.
5. The Adviser may enter into an agreement to retain, at its own
expense, a firm or firms ("SubAdviser") to provide the Trust with respect to all
or any of its Funds all of the services to be provided by the Adviser hereunder,
if such agreement is approved as required by law. Such agreement may delegate
to such SubAdviser all of Adviser's rights, obligations, and duties hereunder.
6. The Adviser shall not be liable for any error of judgment or mistake
of law or for any loss suffered by the Trust or any of its Funds in connection
with the performance of this Agreement, except a loss resulting from the
Adviser's willful misfeasance, bad faith, gross negligence, or from reckless
disregard by it of its obligations and duties under this Agreement. Any person,
even though also an officer, Director, partner, employee, or agent of the
Adviser, who may be or become an officer, Trustee, employee, or agent of the
Trust, shall be deemed, when rendering services to the Trust or any of its Funds
or acting on any business of the Trust or any of its Funds (other than services
or business in connection with the Adviser's duties hereunder), to be rendering
such services to or acting solely for the Trust or any of its Funds and not as
an officer, Director, partner, employee, or agent or one under the control or
direction of the Adviser even though paid by it.
7. The Trust shall cause the books and accounts of each of its Funds to
be audited at least once each year by a reputable independent public accountant
or organization of public accountants who shall render a report to the Trust.
8. Subject to and in accordance with the Declaration of Trust of the
Trust, the governing documents of the Adviser and the governing documents of any
SubAdviser, it is understood that Trustees, Directors, officers, agents and
shareholders of the Trust or any Adviser are or may be interested in the Adviser
(or any successor thereof) as Directors and officers of the Adviser or its
affiliates, as stockholders of Allianz AG Holding or otherwise; that Directors,
officers and agents of the Adviser and its affiliates or stockholders of Allianz
AG Holding are or may be interested in the Trust or any Adviser as Trustees,
Directors, officers, shareholders or otherwise; that the Adviser (or any such
successor) is or may be interested in the Trust or any SubAdviser as
shareholder, or otherwise; and that the effect of any such adverse interests
shall be governed by the Declaration of Trust of the Trust, governing documents
of the Adviser and governing documents of any SubAdviser.
9. This Agreement shall continue in effect for two years from the date
set forth above and after such date if (a) such continuance is specifically
approved at least annually by the Board of Trustees of the Trust or by a vote of
a majority of the outstanding voting securities of the Trust, and (b) such
renewal has been approved by the vote of the majority of Trustees of the Trust
who are not interested persons, as that term is defined in the 1940 Act, of the
Adviser or of the Trust, cast in person at a meeting called for the purpose of
voting on such approval.
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10. On sixty days' written notice to the Adviser, this Agreement may be
terminated at any time without the payment of any penalty by the Board of
Trustees of the Trust or by vote of the holders of a majority of the outstanding
voting securities of the affected Funds; and on sixty days' written notice to
the Trust, this Agreement may be terminated at any time without the payment of
any penalty by the Adviser. This Agreement shall automatically terminate upon
its assignment (as that term is defined in the 1940 Act). Any notice under this
Agreement shall be given in writing, addressed and delivered, or mailed postage
prepaid, to the other party at the main office of such party.
11. This Agreement may be amended at any time by an instrument in
writing executed by both parties hereto or their respective successors, provided
that with regard to material amendments such execution by the Trust shall have
been first approved by the vote of the holders of a majority of the outstanding
voting securities of the affected Funds and by the vote of a majority of
Trustees of the Trust who are not interested persons (as that term is defined in
the 0000 Xxx) of the Adviser, or of the Trust, cast in person at a meeting
called for the purpose of voting on such approval. A "majority of the
outstanding voting securities of the Trust or the affected Funds" shall have,
for all purposes of this Agreement, the meaning provided therefor in the 1940
Act.
12. Any compensation payable to the Adviser hereunder for any period
other than a full year shall be proportionately adjusted.
13. The Trust acknowledges that the Adviser and its affiliates have
granted the Trust the non-exclusive right to use of the name "USAllianz Funds"
and agrees that all rights in and to such name and any and all service marks or
other intellectual property related thereto or associated therewith are and
remain the property of the Adviser and its affiliates. Without limiting the
generality of the foregoing, the Trust acknowledges that the Adviser and its
affiliates may withdraw the right to use such name and related intellectual
property by notice in writing to the Trust and upon receipt of such notice, the
Trust agrees to promptly take such steps as may be necessary to change its name
and/or the name of any Funds and to cease use of any intellectual property
belonging to the Adviser or its affiliates.
14. The provisions of this Agreement shall be governed, construed, and
enforced in accordance with the laws of The State of Delaware.
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IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement on the day and year first above written.
USALLIANZ FUNDS
By:/s/Xxxxx X. Xxxxxx
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Name:
Title: Business Analyst
ALLIANZ OF AMERICA, INC.
By:/s/Xxxxx X. Xxxxx
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Name:
Title: Chief Investment Officer
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Schedule A
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Name of Fund Compensation
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Diversified Assets Fund 0.55%
Global Opportunities Fund 0.95%
Growth Fund 0.75%
Fixed Income Fund 0.50%
Money Market Fund 0.35%
The advisory fee shall be accrued daily at the rate of 1/365th of the
applicable percentage applied to the daily net assets of each Fund. The advisory
fee so accrued shall be paid to the Adviser as provided in Section 4 of the
Investment Advisory Agreement.
