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Exhibit 99.d(2)
INVESTMENT ADVISORY AGREEMENT
AGREEMENT made this 27th day of June, 1994, between Summit Investment
Trust ("Trust"), a Massachusetts business trust having its principal place of
business at 0000 Xxxx Xxxxxx-Xxxxxxxxx Xxxx, Xxxxxxxx, Xxxx 00000, and First
Summit Capital Management, a joint venture (the "Investment Adviser"), having
its principal place of business at 0000 Xxxxxxxx Xxxx, Xxxxxxxxxx, Xxxx 00000.
WHEREAS, the Trust is registered as an open-end, management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act");
and
WHEREAS, the Trust desires to retain the Investment Adviser to furnish
investment advisory and related services to Summit High Yield Fund, an
investment portfolio of the Trust, and may retain the Investment Adviser to
serve in such capacity with respect to certain additional investment portfolios
of the Trust, all as now or hereafter may be identified in Schedule A hereto as
such Schedule may be amended from time to time (individually referred to herein
as a "Fund" and collectively referred to herein as the "Funds") and the
Investment Adviser represents that it is willing and possesses legal authority
to so furnish such services without violation of applicable laws and
regulations;
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, it is agreed between the parties hereto as follows:
1. Appointment. The Trust hereby appoints the Investment Adviser to act
as investment adviser to the Funds for the period and on the terms set forth in
this Agreement. The Investment Adviser accepts such appointment and agrees to
furnish the services herein set forth for the compensation herein provided.
Additional investment portfolios may from time to time be added to that covered
by this Agreement by the parties executing a new Schedule A, which shall become
effective upon its execution or as otherwise specified and shall supersede any
Schedule A having an earlier date.
2. Delivery of Documents. The Trust has furnished the Investment Adviser
with copies properly certified or authenticated of each of the following:
(a) the Trust's Declaration of Trust, dated March 8, 1994
filed with the Secretary of State of Massachusetts on March
8, 1994, and any and all amendments thereto or restatement
thereof (such Declaration, as presently in effect and as it
shall from time to time be amended or restated, is herein
called the "Declaration of Trust");
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(b) the Trust's By-Laws and any amendments thereto;
(c) resolutions of the Trustees of the Trust (the
"Trustees") authorizing the appointment of the Investment
Adviser and approving this Agreement;
(d) the Trust's Notification of Registration on Form N-8A
under the 1940 Act as filed with the Securities and Exchange
Commission (the "Commission") on March 8, 1994, and all
amendments thereto;
(e) the Trust's registration statement on Form N-1A under
the Securities Act of 1933, as amended (the "1933 Act"), and
the 1940 Act as filed with the Commission and all amendments
thereto; and
(f) the most recent Prospectus and Statement of Additional
Information of each of the Funds (such Prospectus and
Statement of Additional Information, as presently in effect,
and all amendments and supplements thereto, are herein
collectively called the "Prospectus").
The Trust will furnish the Investment Adviser from time to time with
copies of all amendments of or supplements to the foregoing.
3. Management. Subject to the supervision of the Trustees, the
Investment Adviser will provide a continuous investment program for the Funds,
including investment research and management with respect to all securities and
investments and cash equivalents in the Funds. The Investment Adviser will
determine from time to time what securities and other investments will be
purchased, retained or sold by the Trust with respect to the Funds. The
Investment Adviser will provide the services under this Agreement in accordance
with each of the Fund's investment objectives, policies and restrictions as
stated in the Prospectus and resolutions of the Trustees. The Investment
Adviser further agrees that it:
(a) will use the skill and care in providing such services
as is appropriate for fiduciary accounts;
(b) will conform with all applicable Rules and Regulations
of the Commission under the 1940 Act and in addition will
conduct its activities under this Agreement in accordance
with any applicable regulations of any governmental authority
pertaining to the investment advisory activities of the
Investment Adviser;
(c) will place or cause to be placed for the Funds all
necessary orders with brokers, dealers or issuers and will
negotiate brokerage commissions if applicable. The
Investment Adviser is directed at all
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times to execute brokerage transactions for the Funds in
accordance with such policies or practices as may be
established by the Trustees and described in the Trust's
registration statement as amended. The Investment Adviser
may pay a broker-dealer which provides research and
brokerage services a higher commission for a particular
transaction than otherwise might have been charged by
another broker-dealer, if the Investment Adviser determines
that the higher commission is reasonable in relation to the
value of the brokerage and research services that such
broker-dealer provides, viewed in terms of either the
particular transaction or the Investment Adviser's overall
responsibilities with respect to accounts managed by the
Investment Adviser. The Investment Adviser may use for the
benefit of the Investment Adviser's other clients, or make
available to companies affiliated with the Investment
Adviser or to its directors for the benefit of its clients,
any such brokerage and research services that the Investment
Adviser obtains from brokers or dealers;
(d) will maintain all books and records with respect to the
securities transactions of the Funds and will furnish the
Trustees with such periodic and special reports as the
Trustees may request;
(e) will treat confidentially and as proprietary information
of the Trust all records and other information relative to
the Trust and the Funds and prior, present, or potential
shareholders, and will not use such records and information
for any purpose other than performance of its
responsibilities and duties hereunder, except after prior
notification to and approval in writing by the Trust, which
approval shall not be unreasonably withheld and may not be
withheld where the Investment Adviser may be exposed to
civil or criminal contempt proceedings for failure to
comply, when requested to divulge such information by duly
constituted authorities, or when so requested by the Trust;
(f) will conduct its fiduciary functions independently. In
making investment recommendation for the Funds, the
Investment Adviser's personnel will not inquire or take into
consideration whether the issuers of securities proposed for
purchase or sale for the Trust's account are customers of
the Investment Adviser or of its parent or affiliates;
(g) will promptly review all (1) current security reports,
(2) summary reports of transactions and pending maturities
(including the principal, cost and accrued interest on each
portfolio security in maturity date order) and (3) current
cash position reports (including cash available
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from portfolio sales and maturities and sales of a Fund's
shares less cash needed for redemptions and settlement of
portfolio purchases) upon receipt thereof from the Trust and
will report any errors or discrepancies in such reports to
the Trust or its designee within three (3) business days;
and
(h) will obtain and provide to the Trust's fund accountant
(1) dealer quotations, (2) prices from a pricing service,
(3) matrix prices, or (4) any other price information
believed to be reliable by the Investment Adviser with
respect to any security held by a Fund, when requested to do
so by the Trust's fund accountant.
4. Services Not Exclusive. The investment management services furnished
by the Investment Adviser hereunder are not to be deemed exclusive, and the
Investment Adviser shall be free to furnish similar services to others so long
as its services under this Agreement are not impaired thereby.
5. Books and Records. In compliance with the requirements of Rule 31a-3
under the 1940 Act, the Investment Adviser hereby agrees that all records which
it maintains for the Funds are the property of the Trust and further agrees to
surrender promptly to the Trust any of such records upon the Trust's request.
The Investment Adviser further agrees to preserve for the periods prescribed by
Rule 31a-2 under the 1940 Act the records required to be maintained by Rule
31a-1 under the 1940 Act.
6. Expenses. During the term of this Agreement, the Investment Adviser
will pay all expenses incurred by it in connection with its activities under
this Agreement other than the cost of securities (including brokerage
commissions, if any) purchased for the Funds.
7. Compensation. For the services provided and the expenses assumed
pursuant to this Agreement, each of the Funds will pay the Investment Adviser
and the Investment Adviser will accept as full compensation therefor a fee as
set forth on Schedule A hereto. The obligation of each Fund to pay the above
described fee to the Investment Adviser will begin as of the date of the
initial public sale of shares of such Fund or such other date as is agreed to
by the parties. The fee attributable to each Fund shall be the obligation of
that Fund and not of any other Fund.
If in any fiscal year the aggregate expenses of any of the Fund (as
defined under the securities regulations of any state having jurisdiction over
the Trust) exceed the expense limitations of any such state, the Investment
Adviser will reimburse the Fund for a portion of such excess expenses equal to
such excess times the ratio of the fees otherwise payable by the Fund to the
Investment Adviser hereunder to the aggregate fees otherwise payable by the
Fund to the Investment Adviser hereunder and to The Winsbury Company under the
Management and Administration Agreement between The Winsbury Company and the
Trust; provided, however, that if such Management and Administration Agreement
shall not be then in effect, the Investment Adviser will reimburse the Fund for
all of such
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excess. The obligation of the Investment Adviser to reimburse the Funds
hereunder is limited in any fiscal year to the amount of its fee hereunder for
such fiscal year, provided, however, that notwithstanding the foregoing, the
Investment Adviser shall reimburse the Funds for such excess expenses
regardless of the amount of fees paid to it during such fiscal year to the
extent that the securities regulations of any state having jurisdiction over the
Trust so require.
8. Limitation of Liability. The Investment Adviser shall not be liable
for any error of judgement or mistakes of law or for any loss suffered by the
Funds in connection with the performance of this Agreement, except a loss
resulting from a breach of fiduciary duty with respect to the receipt of
compensation for services or a loss resulting from willful misfeasance, bad
faith or gross negligence on the part of the Investment Adviser in the
performance of its duties or from reckless disregard by it of its obligations
and duties under this Agrement.
9. Duration and Termination. This Agreement will become effective with
respect to the Summit High Yield Fund as of the date first written above (or, if
a particular Fund is not in existence on that date, on the date a registration
statement relating to that Fund becomes effective with the Commission),
provided that it shall have been approved by vote of a majority of the
outstanding voting securities of such Fund, in accordance with the requirements
under the 1940 Act, and, unless sooner terminated as provided herein, shall
continue in effect for a period more than two years from the date of its
execution only so long as such continuance is specifically approved at least
annually (a) by the vote of a majority of the Trustees who are not parties to
this Agreement or interested persons of any party to this Agreement, cast in
person at a meeting called for the purpose of voting on such approval, and (b)
by the Trustees or by the vote of a majority of the outstanding voting
securities of each Fund.
The required shareholder approval of this Agreement or of any continuance
of this Agreement shall be effective with respect to any Fund if a majority of
the outstanding securities of that Fund votes to approve this Agreement or its
continuance, notwithstanding that this Agreement or its continuance may not
have been approved by a majority of the outstanding voting securities of (a)
any other Fund affected by this Agreement or (b) all of the Funds.
If the shareholders of any Fund fail to approve the continuance of this
Agreement, the Investment Adviser will continue to act as investment adviser
with respect to such Fund pending the required approval of the continuance of
the Agreement or of a new contract with the Investment Adviser or a different
investment adviser or other definitive action; provided that the compensation
received by the Investment Adviser in respect of such Fund during such period
will be no more than its actual costs incurred in furnishing investment
advisory and management services to such Fund or the amount it would have
received under this Agreement in respect of such Fund whichever is less.
Notwithstanding the foregoing, this Agreement may be terminated as to a
particular Fund at any time on sixty days' written notice, without the payment
of any penalty, by the Trust (by the Trustees or by vote of a majority of the
outstanding voting securities of such Fund) or by the Investment Adviser. This
Agreement will immediately terminate in the event of its assignment. (As
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used in this Agreement, the terms "majority of the outstanding voting
securities", "interested persons" and "assignment" shall have the same meanings
as ascribed to such terms in the 1940 Act.)
10. Investment Adviser's Representations. The Investment Adviser hereby
represents and warrants that it is willing and possesses all requisite legal
authority to provide the services contemplated by this Agreement without
violation of applicable law and regulations.
11. Amendment of this Agreement. This Agreement may be amended by the
parties only if such amendment is specifically approved by the vote of a
majority of the outstanding voting securities of each of the Funds affected by
the amendment and by the vote of a majority of the Trustees who are not
interested persons of any party to this Agreement cast in person at a meeting
called for the purpose of voting on such approval. The required shareholder
approval shall be effective with respect to any Fund if a majority of the
outstanding voting securities of that Fund vote to approve the amendment,
notwithstanding that the amendment may not have been approved by a majority of
the outstanding voting securities of (a) any other Fund affected by the
amendment or (b) all of the Funds.
12. Governing Law. This Agreement shall be governed by and its provisions
shall be construed in accordance with the laws of the Commonwealth of
Massachusetts.
13. Miscellaneous. The names "Summit Investment Trust" and "Trustees of
Summit Investment Trust" refer respectively to the Trust created and the
Trustees, as trustees but not individually or personally, acting from time to
time under a Declaration of Trust dated as of March 8, 1994, to which reference
is hereby made and a copy of which is on file at the office of the Secretary of
the Commonwealth of Massachusetts and elsewhere as required by law, and to any
and all amendments thereto so filed or hereafter filed. The obligations of
"Summit Investment Trust" entered into in the name or on behalf thereof by any
of the Trustees, representatives or agents are made not individually, but in
such capacities, and are not binding upon any of the Trustees, shareholders or
representatives of the Trust personally, but bind only the assets of the Trust,
and all persons dealing with any series of shares of the Trust must look solely
to the assets of the Trust belonging to such series for the enforcement of any
claims against the Trust.
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IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed by their officers designated below as of the day and year first above
written.
SUMMIT INVESTMENT TRUST
/s/ R. XXXXXXXXXXX XXXX
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By: R. Xxxxxxxxxxx Xxxx, President
Date: June 27, 1994
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FIRST SUMMIT CAPITAL MANAGEMENT
By: Carillon Advisers, Inc.
By: /s/ XXXXXX X. XXXXXXXXXXXX
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Xxxxxx X. Xxxxxxxxxxxx
Vice President
Date: June 27, 1994
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Dated: June 27, 1994 as amended
and restated on December 16, 1997
SCHEDULE A
TO THE
INVESTMENT ADVISORY AGREEMENT
BETWEEN FIRST SUMMIT CAPITAL MANAGEMENT
AND SUMMIT INVESTMENT TRUST
I. Summit High Yield Fund
The investment advisory fee will increase or decrease based on the
total return investment performance of the Fund for the prior twelve-month
period relative to the percentage change in the investment record of the
Salomon Brothers High Yield Market Index for the same period (the "Index
Return"). The advisory fee shall be paid at an annual rate of .75% of the
Fund's total net assets if the Fund's total return investment performance (net
of all fees an expenses, including the advisory fee) equals the index Return.
The advisory fee will be increased or decreased by 4% of the amount by which
the Fund's total return investment performance during the preceding twelve
months exceeds or is less than the Index Return during that period, up to a
maximum fee of 1.15% and down to a minimum fee of 0.35%. The computation of the
total return investment performance of the Fund and the investment record of
the Index will be made in accordance with Rule 205-1 under the Investment
Advisors Act of 1940 or any other applicable rule as is, from time to time, may
be adopted or amended. This rule currently requires calculation as follows:
The total return investment performance of the fund shall be the sum
of:
(i) the change in the Fund's net asset value per share during the
period;
(ii) the value of the Fund's cash distributions per share having an
ex-dividend date occurring within the period; and
(iii) the per share amount of any capital gains taxes paid or accrued
during the period by the Fund for undistributed, realized long term
capital gains, expressed as a percentage of the Fund's net asset value
per share at the beginning of the period.
At the end of each month, the Investment Adviser will receive one-twelfth of
the performance-related portion of the fee computed for the preceding twelve
month period.
II. Summit Emerging Markets Bond Fund
The advisory fee shall be paid at an annual rate of 0.75% of the Fund's
total net assets. At the end of each month, the Investment Adviser will receive
one-twelfth of the fee computed.
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SUMMIT INVESTMENT TRUST
/s/ XXXXX X. XXXXXXXX
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By: Xxxxx X. Xxxxxxxx
Title: Secretary
Date: 1/14/98
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FIRST SUMMIT CAPITAL MANAGEMENT
/s/ XXXXXX X. XXXXXXXXXXXX
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By: Xxxxxx X. Xxxxxxxxxxxx
Title: Representative
Date: 1/16/98
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* All fees are computed daily and paid monthly
