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EXHIBIT (d)(xi)
GOVERNMENT SECURITIES FUND
OF
THE ENTERPRISE GROUP OF FUNDS, INC.
FUND MANAGER'S AGREEMENT
THIS AGREEMENT, made this 9th day of May 2001, is among The Enterprise
Group of Funds, Inc. (the "Fund"), Enterprise Capital Management, Inc., a
Georgia corporation (hereinafter referred to as the "Adviser"), and TCW
Investment Management Company, a California corporation (hereinafter referred to
as the "Fund Manager").
BACKGROUND INFORMATION
(A) The Adviser has entered into an Investment Adviser's Agreement
dated as of September 14, 1987, with The Enterprise Group of Funds, Inc., a
Maryland corporation. 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 whereby the
Fund Manager will provide to the Government Securities Fund of the Fund
securities investment advisory services for the Government Securities 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 Government
Securities 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 Fund advice with
respect to the investment and reinvestment of the assets of the
Government Securities Fund, or such portion of the assets of the
Government Securities Fund as the Adviser shall specify from time to
time, in accordance with the investment objectives, restrictions and
limitations of the Government Securities Fund which are in the Fund's
most recent Registration Statement.
(3) The Fund Manager shall perform a monthly
reconciliation of the Fund to the holdings report provided by the
Fund's custodian and bring any material or significant variances
regarding holding or valuation 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 funds in any way
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except to direct securities transactions pursuant to its investment
advice hereunder. The Fund Manager is not an agent of the Fund or the
funds.
(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 Government Securities Fund.
(6)(a) The Adviser agrees to pay 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 .0250 of 1% of the average of the daily closing net asset
values of the Government Securities Fund managed by the Fund Manager
during such month (that is, .30 of 1% per year) for the first
FIFTY-MILLION DOLLARS ($50,000,000.00) under management, and a sum
equal to .0208 of 1% of the average of the daily closing net asset
values of the Government Securities Fund thereafter in excess of
FIFTY-MILLION DOLLARS ($50,000,000.00), managed by the Fund Manager
during such month (that is, .25 of 1% per year).
(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 Government Securities 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 Government Securities Fund
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.
(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 Government Securities Fund
or the Adviser or to any shareholder or shareholders of the Fund, the
Government Securities 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 will take necessary steps to prevent
the investment professionals of the Fund Manager who are responsible
for investing assets of the Government Securities Fund from taking, at
any time, a short position in any shares of any Portfolio of the Fund.
The Fund Manager also will cooperate with the Fund in adopting a
written policy prohibiting xxxxxxx xxxxxxx with respect to Government
Securities Fund transactions insofar as such transactions may relate to
the Fund Manager.
(10) In connection with the management of the investment
and reinvestment of the assets of the Government Securities Fund, the
Fund Manager is authorized to select the brokers or dealers that will
execute purchase and sale transactions for the Government Securities
Fund, and is directed to use its best efforts to obtain the best
available price and most favorable
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execution with respect to such purchases and sales of fund securities
for the Government Securities Fund. Subject to this primary
requirement, and maintaining as its first consideration the benefits
for the Government Securities Fund and its shareholders, the Fund
Manager shall have the right, subject to the approval of the Board of
Directors of the Fund and of the Adviser, to follow a policy of
selecting brokers and dealers who furnish statistical research and
other services to the Portfolio, the Adviser or the Fund Manager and,
subject to the Rules of Fair Practice of the National Association of
Securities Dealers, Inc., to select brokers and dealers who sell shares
of the funds.
(11) The Fund may terminate this Agreement by thirty 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 days written notice to
the Fund Manager and the Fund Manager may terminate this Agreement by
thirty days written notice to the Adviser, without the payment of any
penalty. This Agreement shall immediately terminate in the event of its
assignment, unless an order is issued by the Securities and Exchange
Commission conditionally or unconditionally exempting such assignment
from the provisions of Section 15(a) of the Investment Company Act of
1940, in which event this Agreement shall remain in full force and
effect.
(12) Subject to prior termination as provided above, this
Agreement shall continue in force from the date of execution until May
9, 2002 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 of 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 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, damage or expense
(including the reasonable cost of investigating or defending any
alleged loss, liability, damages or expense and reasonable counsel fees
incurred in connection therewith), arising by reason of any matter to
which this Fund Manager's Agreement relates. 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, damage or expense
described in the foregoing indemnity, but only with respect to the
Fund Manager's willful
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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 Paragraph 13.
(14) 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.
(15) The Fund Manager agrees to notify the parties within
a reasonable period of time regarding a material change in the
membership of the Fund Manager.
(16) 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.
(17) 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: TCW Investment Management Company
000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxx 0000
Xxx Xxxxxxx, XX 00000
by the Adviser: Enterprise Capital Management, Inc.
0000 Xxxxxxxxx Xxxx, X.X., Xxxxx 000
Xxxxxxx, XX 00000-0000
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
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.
(18) 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.
(19) This Agreement constitutes the entire agreement
between the Fund Manager, the Adviser and the Fund relating to the
Government Securities 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
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Secretary Xxxxxx Xxxxxx, Chairman, President
and Chief Executive Officer
ENTERPRISE CAPITAL MANAGEMENT, INC.
ATTEST: /s/ XXXXXXXXX X. XXXXXXXXX By: /s/ XXXXXX XXXXXX
-------------------------- ------------------------------------
Secretary Xxxxxx Xxxxxx, Chairman, President
and Chief Executive Officer
TCW INVESTMENT MANAGEMENT COMPANY
ATTEST: /s/ XXXXXX XXXX By: /s/ XXXXX X. XXXX, XX.
-------------------------- ------------------------------------
Asst. Secretary Name: Xxxxx X. Xxxx, Xx.
-----------------------------------
Title: President
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