INVESTMENT MANAGEMENT AGREEMENT
THIS AGREEMENT is entered into as of the date the registration statement of
the Xxxxxxxx Investment Trust becomes effective with the Securities and Exchange
Commission by and between the XXXXXXXX INVESTMENT TRUST, a Massachusetts
business trust (the "Trust"), and Xxxxxxxx Investment Management Company, a
Washington limited partnership (the "Investment Manager"), registered as an
investment advisor under the Investment Advisers Act of 1940, as amended.
WHEREAS, the Trust is registered as a no-load, diversified, open-en
management investment company of the series type under the Investment Company
Act of 1940, as amended (the "1940 Act"); and
WHEREAS, the Trust desires to retain the Investment Manager to furnish
investment advisory and administrative services to all series of the Trust, and
the Investment Manager is willing to so furnish such services;
NOW THEREFORE, in consideration of the promises and mutual covenants herein
contained, it is agreed between the parties hereto as follows:
1. Appointment. The Trust hereby appoints the Investment Manager to act as
investment adviser to any series (hereinafter called "Funds") of the Trust for
the period and on the terms set forth in this Agreement. The Investment Manager
accepts such appointment and agrees to furnish the services herein set forth,
for the compensation herein provided.
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, filed with the State of Massachusetts
on January 15, 1988 (such Declaration, as presently in effect and as it shall
from time to time be amended, is herein called the "Declaration"); (b) The
Trust's By-Laws (such By-Laws, as presently in effect and as they shall from
time to time be amended, are herein called the "By-Laws"); (c) Resolutions of
the Trust's Board of Trustees authorizing the appointment of the Investment
Manager and approving this Agreement; (d) The Trust's Registration Statement on
Form N-1A under the 1940 Act and under the Securities Act of 1933 as amended,
(the "1933 Act"), relating to shares of beneficial interest of the Trust (herein
called the "Shares") as filed with the Securities and Exchange Commission and
all amendments thereto; (e) The Trust's Prospectuses (such Prospectuses, as
presently in effect and all amendments and supplements thereto are herein called
the "Prospectus").
The Trust will furnish the Investment Manager from time to time with
copies, properly certified or authenticated, of all amendments of or supplements
to the foregoing.
3. Management. Subject to the supervision of the Trust's Board of Trustees,
the Investment Manager will provide a continuous investment program for each of
the Trust's Funds, including investment research and management with respect to
all securities and investments and cash and cash equivalents in each of the
Trust's Funds. The Investment Manager will determine from time to time what
securities and other investments will be purchased, retained or sold by the
Funds. The Investment Manager will provide the services under this Agreement in
accordance with each Fund's investment objectives, policies and restrictions as
stated in its Prospectus. The Investment Manager further agrees that it:
INVESTMENT MANAGEMENT AGREEMENT Page 2
(a) Will conform with all applicable Rules and Regulations of the
Securities and Exchange Commission and will, in addition, conduct its activities
under this Agreement in accordance with regulations of any other Federal and
State agencies which may now or in the future have jurisdiction over its
activities;
(b) Will place orders pursuant to its investment determinations for the
Funds either directly with the issuer or with any broker or dealer. In placing
orders with brokers or dealers, the Investment Manager will attempt to obtain
the best net price and the most favorable execution of its orders. Consistent
with this obligation, when the Investment Manager believes two or more brokers
or dealers are comparable in price and execution, the Investment Manger may
prefer brokers and dealers who provide the Funds with research advice and other
services, or who sell Fund shares. In no instance will portfolio securities be
purchased from or sold to the Investment Manager or any affiliated person of the
Investment Manager;
(c) Will hire all necessary executive personnel for the Trust, the salaries
and expenses of such personnel to be borne by the Investment Manager;
(d) Will hire, at the cost of the Trust, all non-executive personnel who
will provide clerical, accounting, and general office services as may be
required by and requested by the Trust, the salaries of such personnel to be
subject to the approval of the Trustees; (e) Will provide, at its own cost, all
office space, facilities and equipment necessary for the activities of the
Trust; and
Notwithstanding the foregoing, the Investment Manager may obtain the
services of an investment counselor or sub-advisor of its choice subject to the
Trust's approval. The cost of employing such counselor of sub-advisor will be
paid by the Investment Manager and not by the Trust.
4. Services Not Exclusive. The investment management services furnished by
the Investment Manager hereunder are not to be deemed exclusive, and the
Investment Manager shall be free to furnish similar services to others so long
as its services under this Agreement are not impaired thereby provided, however,
that without the written consent of the Trustees, the Investment Manager will
not serve as investment adviser to any other investment company having a similar
investment objective to that of any of the Funds of the Trust.
5. Books and Records. In compliance with the requirements of Rule 31a-3
under the 1940 Act, the Investment Manager hereby agrees that all records which
it maintains for the Trust 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 Manager 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 Act.
6. Expenses. During the term of this Agreement, the Investment Manager will
pay al expenses incurred by it in connection with administration and investment
management of the Trust, and, in accordance with any Distribution Plan then in
effect, certain expenses incurred by or on behalf of the Trust in the promotion
and sale of the Shares.
Notwithstanding the foregoing, the Trust shall pay the expenses and costs
of the following:
(a) Taxes;
(b) Brokerage fees and commissions with regard to portfolio transaction
of the Funds;
(c) Interest charges, fees and expenses of the custodian of the
Funds' portfolio securities;
(d) Fees and expenses of the Funds' transfer agent and shareholder
servicing agents;
(e) Auditing and legal expenses;
(f) Cost of maintenance of the Trust's existence as a legal entity;
(g) Compensation of trustees who are not interested persons of the
Investment Manager as that term is defined by law;
(h) Costs of Trust meetings;
(i) Federal and State registration fees and expenses;
(j) Costs of printing and mailing Prospectuses, reports and notices to
existing shareholders;
INVESTMENT MANAGEMENT AGREEMENT Page 3
(k) The Investment Management fee payable to the Investment Manger,
as provided in paragraph 7 herein; and
(l) Fees and expenses of the Funds' administrative service provider, if
any, who maintains the account books and records of the Funds, as
required by Rule 3a-3 of the 1940 Act, including the performance of
daily pricing of the Funds' shares in accordance with the Funds'
Prospectus.
It is understood that the Trust may desire to register its Funds' shares
for sale in certain states which impose expense limitations on mutual funds. The
Trust agrees that it will register share in such states only with the prior
written consent of the Investment Manager and, if consent is granted, the
Investment Manager agrees to reimburse the Trust for any excess expenses
incurred over the most stringent of such states' limitations.
7. Compensation. For the services provided and the expenses assumed by the
Investment Manager pursuant to this Agreement, the Trust will pay the Investment
Manager and the Investment Manager will accept as full compensation a management
fee, based upon the daily average net assets of each Fund of the Trust, computed
at the end of each month and payable within five (5) business days thereafter,
according to the Management Fee Schedule attached hereto.
8. Limitation of Liability. The Investment Manager shall not be liable for
any error of judgment or mistake of law or for any loss suffered by the Trust 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 Manager in the performance of its
duties or from reckless disregard by it of its obligations and duties under this
Agreement.
9. Duration and Termination. This Agreement shall become effective upon the
date the registration statement of the Trust is declared effective by the
Securities and Exchange Commission and, unless sooner terminated as provided
herein, shall continue in effect for two years. Thereafter, this Agreement shall
be renewable for successive periods of one year each, provided such continuance
is specifically approved annually:
(a) By the vote of a majority of those members of the Board of Trustees who
are not parties to this Agreement or "interested persons" of any such party (as
defined in the 1940 Act), cast in person at a meeting called for the purpose of
voting on such approval; and (b) By vote of either the Board or a "majority" (as
that term is defined in the 0000 Xxx) of the outstanding voting securities of
each Fund of the Trust provided, however, that if the holders of any one Fund
fail to approve the agreement, Investment Manager may continue to act as
investment manager of the Fund(s) which did approve the agreement, and may
continue to act as investment manager for the Fund which did not approve the
agreement until new arrangements are made by such Fund.
Notwithstanding the foregoing, this Agreement may be terminated by any Fund
or by the Investment Manager at any time on sixty (60) days' written notice,
without the payment of any penalty, provided that termination by any Fund of the
Trust must be authorized either by vote of the Board of Trustees or by vote of a
majority of the outstanding voting securities of the Fund. This Agreement will
automatically terminate in the event of its assignment (as that term is defined
in the 1940 Act).
10. Amendment of this Agreement. No provision of this Agreement may be
changed, waived, discharged or terminated orally, but only by a written
instrument signed by the party against which enforcement of the change, waiver,
discharge or termination is sought. No material amendment of this Agreement
shall be effective until approved by vote of the holders of a majority of the
Funds' outstanding voting securities (as defined in the 1940 Act).
11. Miscellaneous. The captions in this Agreement are included for
convenience of reference only and in no way define or limit any of the
provisions hereof or otherwise affect their construction or effect. If any
provision of this Agreement shall be held or made invalid by a court decision,
statute, rule or
INVESTMENT MANAGEMENT AGREEMENT
otherwise, the remainder of the Agreement shall not be affected thereby. This
Agreement shall be binding and shall inure to the benefit of the parties hereto
and their respective successors.
12. Applicable Law. This Agreement shall be construed in accordance with,
and governed by, the laws of the State of Washington.
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.
Attest: XXXXXXXX INVESTMENT TRUST
Xxxxxxx X. Xxxxxx By: Xxxx X. Xxxxxxx
Title: Secretary Title: President
Attest: XXXXXXXX INVESTMENT MANAGEMENT COMPANY
Xxxx X. Xxxxxxxx By: Xxxxxxx X. Xxxxxx
Title: President Title: Executive Vice President
MANAGEMENT FEE SCHEDULE
Investment Management Agreement
Xxxxxxxx Investment Trust
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Compensation of the Investment Manager shall be in accordance with the
Investment Management Agreement, paragraph 7, according to the following
schedule:
Xxxxxxxx Flexible Xxxxxxxx Strategic All Other
Bond Fund Equity Fund Xxxxxxxx Funds
Net Assets Annual Rate Annual Rate Annual Rate
---------- ----------------- ------------------ --------------
First $250 Million 1.000% 1.000% 1.250%
Second $250 Million 0.875% 1.000% 1.125%
All over $500 Million 0.750% 1.000% 1.000%
