Exhibit 4
MANAGEMENT AGREEMENT
AGREEMENT made this 7th day of November, 2001, by and between XXXXXXX
XXXXX MULTI-STATE MUNICIPAL SERIES TRUST, a Massachusetts business trust
(hereinafter referred to as the "Trust"), and FUND ASSET MANAGEMENT, L.P., a
Delaware limited partnership (hereinafter referred to as the "Manager").
WITNESSETH:
WHEREAS, the Trust is engaged in business as an open-end investment
company registered under the Investment Company Act of 1940, as amended
(hereinafter referred to as the "Investment Company Act"); and
WHEREAS, the Trustees of the Trust (the "Trustees") are authorized to
establish separate series relating to separate portfolios of securities, each of
which will offer a separate class of shares; and
WHEREAS, the Trustees have established and designated the XXXXXXX XXXXX
NEW YORK MUNICIPAL BOND FUND (the "Fund") as a series of the Trust; and
WHEREAS, the Manager is engaged principally in rendering management and
investment advisory services and is registered as an investment adviser under
the Investment Advisers Act of 1940, as amended; and
WHEREAS, the Trust desires to retain the Manager to render management and
investment advisory services to the Trust and Fund in the manner and on the
terms hereinafter set forth; and
WHEREAS, the Manager is willing to provide management and investment
advisory services to the Trust and the Fund on the terms and conditions
hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the covenants
hereinafter contained, the Trust and the Manager hereby agree as follows:
ARTICLE I
DUTIES OF THE MANAGER
The Trust hereby employs the Manager to act as an investment manager and
investment adviser of the Fund and to furnish, or arrange for affiliates to
furnish, the management and investment advisory services described below,
subject to the policies of, review by and overall control of the Trustees, for
the period and on the terms and conditions set forth in this Agreement. The
Manager hereby accepts such employment and agrees during such period, at its own
expense, to render, or arrange for the rendering of, such services and to assume
the obligations herein set forth for the compensation provided for herein. The
Manager and its affiliates shall for all purposes herein be deemed to be
independent contractors and shall, unless otherwise expressly provided or
authorized, have no authority to act for or represent the Trust or the Fund in
any way or otherwise be deemed agents of the Trust or the Fund.
(a) Management and Administrative Services. The Manager shall perform (or
arrange for the performance by affiliates of) the management and administrative
services necessary for the operation of the Trust and the Fund including
administering shareholder accounts and handling shareholder relations. The
Manager shall provide the Trust and the Fund with office space, equipment and
facilities and such other services as the Manager, subject to review by the
Trustees, shall from time to time determine to be necessary or useful to perform
its obligations under this Agreement. The Manager shall also, on behalf of the
Trust and the Fund, conduct relations with custodians, depositories, transfer
agents, dividend disbursing agents, other shareholder servicing agents,
accountants, attorneys, underwriters, brokers and dealers, corporate
fiduciaries, insurers, banks and such other persons in any such other capacity
deemed to be necessary or desirable. The Manager shall generally monitor the
Trust's and the Fund's compliance with investment policies and restrictions as
set forth in the currently effective prospectus and statement of additional
information relating to the shares of the Fund under the Securities Act of 1933,
as amended (the "Prospectus" and "Statement of Additional Information,"
respectively). The Manager shall make reports to the Trustees of its performance
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of obligations hereunder and furnish advice and recommendations with respect to
such other aspects of the business and affairs of the Trust and the Fund as it
shall determine to be desirable.
(b) Investment Advisory Services. The Manager shall provide (or arrange
for the provision by affiliates of) the Trust with such investment research,
advice and supervision as the latter may from time to time consider necessary
for the proper supervision of the assets of the Fund, shall furnish continuously
an investment program for the Fund and shall determine from time to time which
securities shall be purchased, sold or exchanged and what portion of the assets
of the Fund shall be held in the various money market securities or cash,
subject always to the restrictions of the Declaration of Trust and By-Laws of
the Trust, each as amended from time to time, the provisions of the Investment
Company Act and the statements relating to the Trust's investment objectives,
investment policies and investment restrictions as the same are set forth in the
Prospectus and Statement of Additional Information. The Manager shall also make
decisions for the Trust as to the manner in which voting rights, rights to
consent to corporate action and any other rights pertaining to the Trust's
portfolio securities shall be exercised. Should the Trustees at any time,
however, make any definite determination relating to investment policy and
notify the Manager thereof in writing, the Manager shall be bound by such
determination for the period, if any, specified in such notice or until
similarly notified that such determination has been revoked. The Manager shall
take, on behalf of the Fund, all actions which it deems necessary to implement
the investment policies determined as provided above, and in particular to place
all orders for the purchase or sale of portfolio securities for the Fund's
account with brokers or dealers selected by it, and to that end, the Manager is
authorized as the agent of the Trust to give instructions to the custodian of
the Fund as to deliveries of securities and payments of cash for the account of
the Fund. In connection with the selection of such brokers or dealers and the
placing of such orders with respect to assets of the Fund, the Manager is
directed at all times to seek to obtain execution and prices within the policy
guidelines determined by the Trustees as set forth in the Prospectus and
Statement of Additional Information. Subject to this requirement and the
provisions of the Investment Company Act, the Securities Exchange Act of 1934,
as amended, and other applicable provisions of law, the Manager may select
brokers or dealers with which it or the Trust is affiliated.
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(c) Notice Upon Change in Partners of the Manager. The Manager is a
limited partnership and its limited partner is Xxxxxxx Xxxxx & Co., Inc. and its
general partner is Princeton Services, Inc. The Manager will notify the Trust of
any change in the membership of the partnership within a reasonable time after
such change.
ARTICLE II
ALLOCATION OF CHARGES AND EXPENSES
(a) The Manager. The Manager assumes and shall pay, or cause its
affiliates to pay, for maintaining the staff and personnel necessary to perform
its obligations under this Agreement, and shall at its own expense, provide the
office space, facilities, equipment and necessary personnel which it is
obligated to provide under Article I of this Agreement. The Manager shall pay,
or cause its affiliates to pay, compensation for all officers of the Trust and
all Trustees of the Trust who are affiliated persons of the Manager, or an
affiliate of the Manager.
(b) The Trust. The Trust assumes and shall pay or cause to be paid all
other expenses of the Trust and the Fund (except for the expenses paid by the
distributor of the Fund's shares (the "Distributor")), including, without
limitation: taxes, expenses for legal and auditing services, costs of printing
proxies, stock certificates, shareholder reports, prospectuses and statements of
additional information, charges of the custodian, any sub-custodian and transfer
agent, expenses of portfolio transactions, expenses of redemption of shares,
Securities and Exchange Commission fees, expenses of registering the shares
under Federal, state and foreign laws, fees and actual out-of-pocket expenses of
all Trustees who are not affiliated persons of the Manager or of an affiliate of
the Manager, accounting and pricing costs (including the daily calculation of
the net asset value), insurance, interest, brokerage costs, litigation and other
extraordinary or non-recurring expenses, costs of printing proxies and other
expenses related to shareholder meetings, and other expenses properly payable by
the Trust and the Fund. It also is understood that if the Manager or any of its
affiliates provide accounting services to the Trust and the Fund, the Trust will
reimburse the Manager and its affiliates for their costs in providing accounting
services to the Trust and the Fund. The Distributor will pay certain of the
expenses of the Fund incurred in connection with the continuous offering of Fund
shares.
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ARTICLE III
COMPENSATION OF THE MANAGER
For the services rendered, the facilities furnished and expenses assumed
by the Manager hereunder, the Trust shall pay to the Manager at the end of each
calendar month a fee based upon the average daily value of the net assets of the
Fund, as determined and computed in accordance with the description of the
determination of net asset value contained in the Prospectus and Statement of
Additional Information, at the annual rate of 0.55% of the average daily net
assets commencing on the day following effectiveness hereof. If this Agreement
becomes effective subsequent to the first day of a month or shall terminate
before the last day of a month, compensation for that part of the month this
Agreement is in effect shall be prorated in a manner consistent with the
calculation of the fee as set forth above. Payment of the Manager's compensation
for the preceding month shall be made as promptly as possible after completion
of the computations contemplated herein. During any period when the
determination of net asset value is suspended by the Trustees, the net asset
value of a share of the Fund as of the last business day prior to such
suspension shall for this purpose be deemed to be the net asset value at the
close of each succeeding business day until it is again determined.
ARTICLE IV
LIMITATION OF LIABILITY OF THE MANAGER
The Manager shall not be liable for any error of judgment or mistake of
law or for any loss arising out of any investment or for any act or omission in
the management of the Trust and the Fund, except for willful misfeasance, bad
faith or gross negligence in the performance of its duties, or by reason of
reckless disregard of its obligations and duties hereunder. As used in this
Article IV, the term "Manager" shall include any affiliates of the Manager
performing services for the Trust or the Fund contemplated hereby and the
partners, directors, officers and employees of the Manager and such affiliates.
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ARTICLE V
ACTIVITIES OF THE MANAGER
The services of the Manager to the Trust and the Fund are not to be deemed
to be exclusive, and the Manager and any person controlled by or under common
control with the Manager (for purposes of this Article V referred to as
"affiliates") are free to render services to others. It is understood that
Trustees, officers, employees and shareholders of the Trust and the Fund are or
may become interested in the Manager and its affiliates, as directors, officers,
employees, partners, and shareholders or otherwise and that directors, officers,
employees, partners, and shareholders of the Manager and its affiliates are or
may become similarly interested in the Trust and the Fund, and that the Manager
and directors, officers, employees, partners, and shareholders of its affiliates
may become interested in the Trust and the Fund as shareholders or otherwise.
ARTICLE VI
DURATION AND TERMINATION OF THIS CONTRACT
This Agreement shall become effective as of the date first above written
and shall remain in force for a period of two years thereafter and thereafter
continue from year to year, but only so long as such continuance is specifically
approved at least annually by (i) the Trustees, or by the vote of a majority of
the outstanding voting securities of the Fund, and (ii) a majority of those
Trustees 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.
This Agreement may be terminated at any time, without the payment of any
penalty, by the Trustees or by vote of a majority of the outstanding voting
securities of the Fund, or by the Manager, on sixty days' written notice to the
other party. This Agreement shall automatically terminate in the event of its
assignment
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ARTICLE VII
AMENDMENTS OF THIS AGREEMENT
This Agreement may be amended by the parties only if such amendment is
specifically approved by the vote of the Trustees of the Trust, including a
majority of those Trustees 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 and, when required by the Investment Company Act, by the
vote of a majority of the outstanding voting securities of the Fund.
ARTICLE VIII
DEFINITIONS OF CERTAIN TERMS
The terms "vote of a majority of the outstanding voting securities",
"assignment", "affiliated person" and "interested person", when used in this
Agreement, shall have the respective meanings specified in the Investment
Company Act and the rules and regulations thereunder, subject, however, to such
exemptions as may be granted by the Securities and Exchange Commission under the
Investment Company Act.
ARTICLE IX
GOVERNING LAW
This Agreement shall be construed in accordance with laws of the State of
New York and the applicable provisions of the Investment Company Act. To the
extent that the applicable laws of the State of New York, or any of the
provisions herein, conflict with the applicable provisions of the Investment
Company Act, the latter shall control.
ARTICLE X
PERSONAL LIABILITY
The Declaration of Trust establishing Xxxxxxx Xxxxx Multi-State Municipal
Series Trust, dated August 2, 1985, a copy of which, together with all
amendments thereto (the "Declaration"), is on file in the office of the
Secretary of the Commonwealth of Massachusetts,
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provides that the name "Xxxxxxx Xxxxx Multi-State Municipal Series Trust,"
refers to the trustees under the Declaration collectively as Trustees, but not
as individuals or personally; and no Trustee, shareholder, officer, employee or
agent of Xxxxxxx Xxxxx Multi-State Municipal Series Trust, shall be held to any
personal liability, nor shall resort be had to their private property for the
satisfaction of any obligation or claim or otherwise in connection with the
affairs of said Xxxxxxx Xxxxx Multi-State Municipal Series Trust, but the "Trust
Property" only shall be liable.
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IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the date first above written.
XXXXXXX XXXXX MULTI-STATE MUNICIPAL SERIES TRUST
By: Xxxxx X. Xxxxx
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Title:
FUND ASSET MANAGEMENT, L.P.
By: Princeton Services, Inc., General Partner
By: /s/ Xxxxx X. Xxxxx
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Title:
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