Exhibit (d)(7)
EXHIBIT A
INVESTMENT ADVISORY AGREEMENTS
INVESTMENT ADVISORY AGREEMENT
As Amended March 24, 2000
THIS AGREEMENT is made this 26th day of February, 1990 by and between
The Tocqueville Fund, a Massachusetts business trust (the "Fund") and
Tocqueville Asset Management L.P., a limited partnership (the "Investment
Adviser");
W I T N E S S E T H
WHEREAS, the Fund is registered as an open-end, diversified management
investment company under the Investment Company Act of 1940, as amended (the
"Investment Company Act"), and the rules and regulations promulgated thereunder;
and
WHEREAS, the Investment Adviser is registered as an investment adviser
under the Investment Advisers Act of 1940, as amended (the "Investment Advisers
Act"), and engages in the business of acting as an investment adviser; and
WHEREAS, the Fund and the Investment Adviser desire to enter into an
agreement to provide for the management of the assets of the Fund on the terms
and conditions hereinafter set forth.
NOW THEREFORE, in consideration of the mutual covenants herein
contained and other good and valuable consideration, the receipt whereof is
hereby acknowledged, the parties hereto agree as follows:
1. Management. The Investment Adviser shall act as investment adviser
for the Fund and shall, in such capacity, supervise the investment and
reinvestment of the cash, securities or other properties comprising the Fund's
assets, subject at all times to the policies and control of the Fund's Board of
Trustees. The Investment Adviser shall give the Fund the benefit of its best
judgment, efforts and facilities in rendering its services as investment
adviser.
2. Duties of Investment Advisor. In carrying out its obligations under
paragraph 1 hereof, the Investment Adviser shall:
(a) supervise and manage all aspects of the Fund's operations;
(b) provide the Fund or obtain for it, and thereafter supervise, such
executive, administrative, clerical and shareholder servicing services as are
deemed advisable by the Fund's Board of Trustees;
(c) arrange, but not pay for, the periodic updating of prospectuses and
supplements thereto, proxy material, tax returns, reports to the Fund's
shareholders and reports to and filings with the Securities and Exchange
Commission, state Blue Sky authorities;
(d) provide the Fund with, or obtain for it, adequate office space and
all necessary office equipment and services, including telephone service, heat,
utilities, stationery supplies and similar items for the Fund's principal
office;
(e) provide the Board of Trustees of the Fund on a regular basis with
financial reports and analyses on the Fund's operations and the operations of
comparable investment companies;
(f) obtain and evaluate pertinent information about significant
developments and economic, statistical and financial data, domestic, foreign or
otherwise, whether affecting the economy generally or the Fund, and whether
concerning the individual issuers whose securities are included in the Fund or
the activities in which they engage, or with respect to securities which the
Investment Adviser considers desirable for inclusion in the Fund;
(g) determine what issuers and securities shall be represented in the
Fund's portfolio and regularly report them to the Board of Trustees;
(h) formulate and implement continuing programs for the purchases and
sales of the securities of such issuers and regularly report thereon to the
Board of Trustees; and
(i) take, on behalf of the Fund, all actions which appear to the Fund
necessary to carry into effect such purchase and sale programs and supervisory
functions as aforesaid, including the placing of orders for the purchase and
sale of portfolio securities.
3. Broker-Dealer Relationships. The Investment Adviser is responsible
for decisions to buy and sell securities for the Fund, broker-dealer selection,
and negotiation of brokerage commission rates. The Investment Adviser's primary
consideration in effecting a security transaction will be execution at a price
that is reasonable and fair compared to the commission, fee or other
remuneration received or to be received by other brokers in connection with
comparable transactions including similarly securities being purchased or sold
on a securities exchange during a comparable period of time.
In selecting a broker-dealer to execute each particular transaction,
the Investment Adviser will take the following into consideration: the best net
price available; the reliability, integrity and financial condition of the
broker-dealer; the size of and difficulty in executing the order; and the value
of the expected contribution of the broker-dealer to the investment performance
of the Fund on a continuing basis. Accordingly, the price to the Fund in any
transaction may be less favorable than that available from another broker-dealer
if the difference is reasonably justified by other aspects of the portfolio
execution services offered. Subject to such policies and procedures as the Board
of Trustees may determine, the Investment Adviser shall not be deemed to have
acted unlawfully or to have breached any duty created by this Agreement or
otherwise solely by reason of its having caused the Fund to pay a broker or
dealer that provides brokerage and research services to the Investment Adviser
for the Fund's use an amount of commission for effecting a portfolio investment
transaction in excess of the amount of commission another broker or dealer would
have charged for effecting that transaction, if the Investment Adviser
determines in good faith that such amount of commission was reasonable in
relation to the value of the brokerage and research services provided by such
broker or dealer, viewed in terms of either that particular transaction or the
Investment Adviser's overall responsibilities with respect to the Fund. The
Investment Adviser is further authorized to allocate the orders placed by it on
behalf of the Fund to such brokers and dealers who also provide research or
statistical material, or other services to the Fund or the Investment Adviser
for the Fund's use. Such allocation shall be in such amounts and proportions as
the Investment Adviser shall determine and the Investment Adviser will report on
said allocations regularly to the Board of Trustees of the Fund indicating the
brokers to whom such allocations have been made and the basis therefor.
4. Control by Board of Trustees. Any investment program undertaken by
the Investment Adviser pursuant to this Agreement, as well as any other
activities undertaken by the Investment Adviser on behalf of the Fund pursuant
thereto, shall at all times be subject to any directives of the Board of
Trustees of the Fund.
5. Compliance with Applicable Requirements. In carrying out its
obligations under this Agreement, the Investment Adviser shall at all times
conform to:
(a) all applicable provisions of the Investment Company Act and the
Investment Advisers Act and any rules and regulations adopted thereunder as
amended; and
(b) the provisions of the Registration Statements of the Fund under the
Securities Act of 1933 and the Investment Company Act; and
(c) the provisions of the Declaration of Trust of the Fund, as amended;
and
(d) the provisions of the By-laws of the Fund, as amended; and
(e) any other applicable provisions of state and federal law.
6. Expenses. The expenses connected with the Fund shall be allocable
between the Fund and the Investment Adviser as follows:
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(a) The Investment Adviser shall furnish, at its expense and without
cost to the Fund, the services of a President, Secretary and one or more Vice
Presidents of the Fund, to the extent that such additional officers may be
required by the Fund for the proper conduct of its affairs.
(b) The Investment Adviser shall further maintain, at its expense and
without costs to the Fund, a trading function in order to carry out its
obligations under subparagraph (i) of paragraph 2 hereof to place orders for the
purchase and sale of portfolio securities for the Fund.
(c) Nothing in subparagraph (a) hereof shall be construed to require
the Investment Adviser to bear:
(i) any of the costs (including applicable office space, facilities and
equipment) of the services of a principal financial officer of the Fund
whose normal duties consist of maintaining the financial accounts and books
and records of the Fund; including the reviewing of calculations of net
asset value and preparing tax returns; or
(ii) any of the costs (including applicable office space, facilities
and equipment) of the services of any of the personnel operating under the
direction of such principal financial officer. Notwithstanding the
obligation of the Fund to bear the expense of the functions referred to in
clauses (i) and (ii) of this subparagraph (c), the Investment Adviser may
pay the salaries, including any applicable employment or payroll taxes and
other salary costs, of the principal financial officer and other personnel
carrying out such functions and the Fund shall reimburse the Investment
Adviser therefor upon proper accounting.
(d) All of the ordinary business expenses incurred in the operations of
the Fund and the offering of its shares shall be borne by the Fund unless
specifically provided otherwise in this paragraph 6. These expenses include but
are not limited to brokerage commissions, legal, auditing, taxes or governmental
fees, the cost of preparing share certificates, custodian, depository, transfer
and shareholder service agent costs, expenses of issue, sale, redemption and
repurchase of shares, expenses of registering and qualifying shares for sale,
insurance premiums on property or personnel (including officers and trustees if
available) of the Fund which inure to its benefit, expenses relating to trustee
and shareholder meetings, the cost of preparing and distributing reports and
notices to shareholders, the fees and other expenses incurred by the Fund in
connection with membership in investment company organizations and the cost of
printing copies of prospectuses and statements of additional information
distributed to shareholders.
7. Delegation of Responsibilities. The Investment Adviser may delegate
the performance of certain administrative services for the Fund to Freedom
Capital Management Corp. ("Freedom") pursuant to an administration agreement, or
to one or more administrators approved by the Board of Trustees, but such
delegation will not relieve the Investment Adviser of the duty to supervise the
performance of administrative services hereunder. If the administrative
functions are delegated to Freedom, then the obligations of Freedom shall be
governed by the Administration Agreement between the Investment Adviser and
Freedom dated February 26, 1990. The Investment Adviser shall conduct the Fund's
relations with Freedom and, in connection therewith, shall be responsible for
providing in a timely and accurate fashion all information and data maintained
by the Investment Adviser on behalf of the Fund necessary for Freedom to perform
its obligations under the Administration Agreement.
Upon the request of the Fund's Board of Trustees, the Investment Adviser
may perform services on behalf of the Fund which are not required by this
Agreement. Such services will be performed on behalf of the Fund and the
Investment Adviser's cost in rendering such services may be billed monthly to
the Fund, subject to examination by the Fund's independent accountants. Payment
or assumption by the Investment Adviser of any Fund expense that the Investment
Adviser is not required to pay or assume under this Agreement shall not relieve
the Investment Adviser of any of its obligations to the Fund nor obligate the
Investment Adviser to pay or assume any similar Fund expense on any subsequent
occasion.
8. Compensation. The Fund shall pay the Investment Adviser in full
compensation for services rendered hereunder an annual investment advisory fee,
payable monthly, of .75% of the Fund's average daily net assets on the first
$500 million and .65% of the Fund's average daily net assets in excess of $500
million. The average daily net asset value of the Fund shall be determined in
the manner set forth in the Declaration of Trust and Prospectus of the Fund.
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9. Expense Limitation. If, for any fiscal year, the total of all
ordinary business expenses of the Fund, including all investment advisory fees
but excluding brokerage commissions and fees, taxes, interest and extraordinary
expenses such as litigation, would exceed the most restrictive expense limits
imposed by any statute or regulatory authority of any jurisdiction in which
shares of the Fund are offered for sale, the investment advisory fee shall be
reduced by the amount of such excess. The amount of any such reduction to be
borne by the Investment Adviser shall be deducted from the monthly investment
advisory fee otherwise payable to the Investment Adviser during such fiscal
year; and if such amount should exceed such monthly fee, the Investment Adviser
agrees to pay to the Fund such excess expenses no later than the last day of the
first month of the next succeeding fiscal year. For the purposes of this
paragraph, the term "fiscal year" shall exclude the portion of the current
fiscal year which shall have elapsed prior to the date hereof and shall include
the portion of the then current fiscal year which shall have elapsed at the date
of termination of this Agreement.
10. Non-Exclusivity. The services of the Investment Adviser to the Fund
are not to be deemed to be exclusive, and the Investment Adviser shall be free
to render investment advisory and corporate administrative or other services to
others (including other investment companies) and to engage in other activities.
It is understood and agreed that officers or Partners of the Investment Adviser
may serve as officers or trustees of the Fund, and that officers or trustees of
the Fund may serve as officers or partners of the Investment Adviser to the
extent permitted by law; and that the officers and partners of the Investment
Adviser are not prohibited from engaging in any other business activity or from
rendering services to any other person, or from serving as partners, officers or
partners of any other firm or corporation, including other investment companies.
11. Term and Approval. This Agreement shall become effective at the
close of business on the date hereof and shall remain in force and effect for
two years and thereafter from year to year, provided that such continuance is
specifically approved at least annually:
(a) (i) by the Fund's Board of Trustees or (ii) by the vote of a
majority of the Fund's outstanding voting securities (as defined in Section 2(a)
(42) of the Investment Company Act); and
(b) by the affirmative vote of a majority of the Trustees who are not
parties to this Agreement or interested persons of a party to this Agreement
(other than as Fund trustees), by votes cast in person at a meeting specifically
called for such purpose.
12. Termination. This Agreement may be terminated at any time, without
the payment of any penalty, by vote of the Fund's Board of Trustees or by vote
of a majority of the Fund's outstanding voting securities, or by the Investment
Adviser, on sixty (60) days' written notice to the other party. The Notice
provided for herein may be waived by either party. This Agreement shall
automatically terminate in the event of its assignment, the term "assignment"
for the purpose having the meaning defined in Section 2(a)(4) of the Investment
Company Act.
13. Liability of Investment Adviser and Indemnification. In the absence
of willful misfeasance, bad faith, gross negligence or reckless disregard of
obligations or duties hereunder on the part of the Investment Adviser or any of
its officers, trustees or employees, it shall not be subject to liability to the
Fund or to any shareholder of the Fund for any omission in the course of, or
connected with, rendering services hereunder or for any losses that may be
sustained in the purchase, holding or sale of any security.
14. Liability of Trustees and Shareholders. A copy of the Agreement and
Declaration of Trust of the Fund is on file with the Secretary of The
Commonwealth of Massachusetts, and notice is hereby given that this instrument
is executed on behalf of the trustees of the Fund as trustees and not
individually and that the obligations of this instrument are not binding upon
any of the trustees or shareholders individually but are binding only upon the
assets and property of the Fund.
15. Notices. Any notices under this Agreement shall be in writing,
addressed and delivered or mailed postage paid to the other party at such
address as such other party may designate for the receipt of such notice. Until
further notice to the other party, it is agreed that the address of the Fund and
that of the Investment Adviser shall be 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
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16. Questions of Interpretation. Any question of interpretation of any
term or provision of this Agreement having a counterpart in or otherwise derived
from a term or provision of the Investment Company Act shall be resolved by
reference to such term or provision of the Act and to interpretations thereof,
if any, by the United States Courts or in the absence of any controlling
decision of any such court, by rules, regulations or orders of the Securities
and Exchange Commission issued pursuant to said Act. In addition, where the
effect of a requirement of the Investment Company Act reflected in any provision
of this Agreement is released by rules, regulation or order of the Securities
and Exchange Commission, such provision shall be deemed to incorporate the
effect of such rule, regulation or order.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in duplicate by their respective officers on the day and year first
above written.
THE TOCQUEVILLE FUND
Attest: By_________________________________
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TOCQUEVILLE ASSET MANAGEMENT L.P.
Attest: By_________________________________
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