ADVISORY AGREEMENT
Alliance Institutional Funds, Inc.
0000 Xxxxxx Xx Xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
November 14, 1997
(as amended as of May 1, 1999 and as of July 20, 2000)
Alliance Capital Management L.P.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
Alliance Institutional Funds, Inc. herewith
confirms our agreement with you as follows:
1. We are an open-end management investment
company registered under the Investment Company Act of 1940,
as amended (the "Act"). We currently have six portfolios,
Alliance Premier Growth Institutional Fund ("Premier
Growth"), Alliance Real Estate Investment Institutional Fund
("Real Estate"), Alliance Quasar Institutional Fund
("Quasar"), Alliance Special Equity Institutional Fund
("Special Equity"), Alliance Technology Institutional Fund
("Technology") and Alliance International Premier Growth
Institutional Fund ("International Premier Growth") (each, a
"portfolio") as described in the prospectuses and the
statements of additional information constituting parts of
our Registration Statement on Form N-1A filed with the
Securities and Exchange Commission (the "Commission") under
the Securities Act of 1933, as amended, and the Act (the
"Registration Statement"). We propose to engage in the
business of investing and reinvesting the assets of each
portfolio in securities ("portfolio assets") of the type and
in accordance with the limitations specified in our Articles
of Incorporation, By-Laws and Registration Statement, and
any representations made in our prospectuses and statements
of additional information, all in such manner and to such
extent as may from time to time be authorized by our Board
of Directors. We enclose a copy of each of the documents
listed above and will from time to time furnish you with any
amendments thereof.
2. (a) With respect to each portfolio, we hereby
employ you to manage the investment and reinvestment of
portfolio assets and, without limiting the generality of the
foregoing, to provide management and other services
specified below.
(b) You will make decisions with respect to
all purchases and sales of portfolio assets. To carry out
such decisions, you are hereby authorized, as our agent and
attorney-in-fact, for our account and at our risk and in our
name, to place orders for the investment and reinvestment of
our assets. In all purchases, sales and other transactions
in each of our portfolios you are authorized to exercise
full discretion and act for us in the same manner and with
the same force and effect as we might or could do with
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respect to such purchases, sales or other transactions, as
well as with respect to all other things necessary or
incidental to the furtherance or conduct of such purchases,
sales or other transactions.
(c) You will report to our Board of Directors
at each meeting thereof all changes in each portfolio since
the prior report, and will also keep us in touch with
important developments affecting any portfolio and on your
own initiative will furnish us from time to time with such
information as you may believe appropriate for this purpose,
whether concerning the individual issuers whose securities
are included in our portfolios, the industries in which they
engage, or the conditions prevailing in the economy
generally. You will also furnish us with such statistical
and analytical information with respect to securities in
each of our portfolios as you may believe appropriate or as
we reasonably may request. In making such purchases and
sales in any of our portfolios, you will bear in mind the
policies set from time to time by our Board of Directors as
well as the limitations imposed by our Articles of
Incorporation and in our Registration Statement, in each
case as amended from time to time, the limitations in the
Act and of the Internal Revenue Code of 1986, as amended, in
respect of regulated investment companies and the respective
investment objective or investment objectives, policies and
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practices, including restrictions, applicable to each of our
portfolios.
(d) It is understood that you will from time
to time employ or associate with yourselves such persons as
you believe to be particularly fitted to assist you in the
execution of your duties hereunder, the cost of performance
of such duties to be borne and paid by you. No obligation
may be incurred on our behalf in any such respect. During
the continuance of this Agreement and at our request you
will provide to us persons satisfactory to our Board of
Directors to serve as our officers. You or your affiliates
will also provide persons, who may be our officers, to
render such clerical, accounting and other services to us as
we may from time to time request of you. Such personnel may
be employees of you or your affiliates. We will pay to you
or your affiliates the cost of such personnel for rendering
such services to us, provided that all time devoted to the
investment or reinvestment of the portfolio assets shall be
for your account. Nothing contained herein shall be
construed to restrict our right to hire our own employees or
to contract for services to be performed by third parties.
Furthermore, you or your affiliates shall furnish us without
charge with such management supervision and assistance and
such office facilities as you may believe appropriate or as
we may reasonably request subject to the requirements of any
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regulatory authority to which you may be subject. You or
your affiliates shall also be responsible for the payment of
any expenses incurred in promoting the sale of our shares
(other than the portion of the promotional expenses to be
borne by us in accordance with an effective plan pursuant to
Rule 12b-1 under the Act and the costs of printing our
prospectuses and reports to shareholders and fees related to
registration with the Commission and with state regulatory
authorities).
3. We hereby confirm that we shall be responsible
and hereby assume the obligation for payment of all of our
expenses, including: (a) payment to you of the fees provided
for in paragraph 5 below; (b) custody, transfer and dividend
disbursing expenses; (c) fees of directors who are not your
affiliated persons; (d) legal and auditing expenses;
(e) clerical, accounting and other office costs; (f) the
cost of personnel providing services to us, as provided in
subparagraph (d) of paragraph 2 above; (g) costs of printing
our prospectuses and shareholder reports; (h) cost of
maintenance of our corporate existence; (i) interest
charges, taxes, brokerage fees and commissions; (j) costs of
stationery and supplies; (k) expenses and fees related to
registrations and filings with the Commission and with state
regulatory authorities; and (l) such promotional,
shareholder servicing and other expenses as may be
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contemplated by one or more effective plans pursuant to Rule
12b-1 under the Act or one or more duly approved and
effective non-Rule 12b-1 shareholder servicing plans, in
each case provided, however, that our payment of such
promotional, shareholder servicing and other expenses shall
be in the amounts, and in accordance with the procedures,
set forth in such plan or plans.
4. We shall expect of you, and you will give us
the benefit of, your best judgment and efforts in rendering
these services to us, and we agree as an inducement to your
undertaking these services that you shall not be liable
hereunder for any mistake of judgment or in any event
whatsoever, except for lack of good faith, provided that
nothing herein shall be deemed to protect, or purport to
protect, you against any liability to us or to our security
holders to which you would otherwise be subject by reason of
willful misfeasance, bad faith or gross negligence in the
performance of your duties hereunder, or by reason of your
reckless disregard of your obligations and duties hereunder.
5. In consideration of the foregoing, we will pay
you with respect to each of Premier Growth, Quasar,
Technology and International Premier Growth a fee at an
annualized rate of 1% of the average daily net assets of
Premier Growth, Quasar, Technology and International Premier
Growth, respectively, and with respect to Real Estate a fee
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at an annualized rate of 0.90% of the average daily net
assets of Real Estate. With respect to Special Equity, we
will pay you a fee at an annualized rate of 1% of the first
$50 million, .75 of 1% of the excess over $50 million up to
$100 million and .50 of 1% of the excess over $100 million
of the average daily net assets of Special EquityTechnology
and International Premier Growth. These fees shall be
payable in arrears on the last day of each calendar month
for services performed hereunder during such month. If our
Registration Statement registering the shares of Technology
and International Premier Growth is declared effective by
the Commission after the beginning of a calendar month or
this Agreement terminates as to a portfolio prior to the end
of a calendar month, the fees for that portfolio shall be
prorated according to the proportion which such portion of
the month bears to the full month.
6. This Agreement shall become effective as to
Special Equity on May 1, 1999 and as to Technology and
International Premier Growth on the date hereof and shall
remain in effect as to each of the first four portfolios
named above until November 5, 1999 and as to Technology and
International Premier Growth until [ ] and
continue in effect thereafter with respect to a portfolio
only so long as its continuance with respect to that
portfolio is specifically approved annually by our Board of
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Directors or by vote of a majority of the outstanding voting
securities (as defined in the Act) of such portfolio, and,
in either case, by vote, cast in person at a meeting called
for the purpose of voting on such approval, of a majority of
our Directors who are not parties to this Agreement or
interested persons, as defined in the Act, of any party to
this Agreement (other than as our Directors), and provided
further, however, that if the continuation of this Agreement
is not approved as to a portfolio, you may continue to
render to such portfolio the services described herein in
the manner and to the extent permitted by the Act and the
rules and regulations thereunder. Upon the effectiveness of
this Agreement, it shall supersede all previous agreements
between us covering the subject matter hereof. This
Agreement may be terminated with respect to any portfolio at
any time, without the payment of any penalty, by vote of a
majority of the outstanding voting securities (as defined in
the Act) of such portfolio, or by a vote of our Board of
Directors on 60 days' written notice to you, or by you with
respect to any portfolio on 60 days' written notice to us.
7. This Agreement shall not be amended as to any
portfolio unless such amendment is approved by vote of a
majority of the outstanding voting securities (as defined in
the Act) of such portfolio, and by vote, cast in person at a
meeting called for the purpose of voting on such approval,
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of a majority of our Directors who are not parties to this
Agreement or interested persons, as defined in the Act, of
any party to this Agreement (other than as our Directors).
Shareholders of a portfolio not affected by any such
amendment shall have no right to vote with respect to such
amendment.
8. As to any particular portfolio, this Agreement
may not be transferred, assigned, sold or in any manner
hypothecated or pledged by you and as to such portfolio,
this Agreement shall terminate automatically in the event of
any such transfer, assignment, sale, hypothecation or pledge
by you. The terms "transfer", "assignment" and "sale" as
used in this paragraph shall have the meanings ascribed
thereto by governing law and any interpretation thereof
contained in rules or regulations promulgated by the
Commission thereunder.
9. (a) Except to the extent necessary to perform
your obligations hereunder, nothing herein shall be deemed
to limit or restrict your right, or the right of any of your
employees, or any of the officers or directors of Alliance
Capital Management Corporation, your general partner, who
may also be a Director, officer or employee of ours, or
persons otherwise affiliated with us (within the meaning of
the Act), to engage in any other business or to devote time
and attention to the management or other aspects of any
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other business, whether of a similar or dissimilar nature,
or to render services of any kind to any other trust,
corporation, firm, individual or association.
(b) You will notify us of any change in the
general partners of your partnership within a reasonable
time after such change.
10. If you cease to act as our investment adviser,
or, in any event, if you so request in writing, we agree to
take all necessary action to change our name to a name not
including the term "Alliance." You may from time to time
make available without charge to us for our use such marks
or symbols owned by you, including marks or symbols
containing the term "Alliance" or any variation thereof, as
you may consider appropriate. Any such marks or symbols so
made available will remain your property and you shall have
the right, upon notice in writing, to require us to cease
the use of such xxxx or symbol at any time.
11. This Agreement shall be construed in
accordance with the laws of the State of New York, provided,
however, that nothing herein shall be construed as being
inconsistent with the Act.
If the foregoing is in accordance with your
understanding, will you kindly so indicate by signing and
returning to us the enclosed copy hereof.
Very truly yours,
ALLIANCE INSTITUTIONAL
10
FUNDS, INC.
By
/s/
Agreed to and accepted as amended
as of the date first set forth above
ALLIANCE CAPITAL MANAGEMENT L.P.
By ALLIANCE CAPITAL MANAGEMENT
CORPORATION, its general
partner
By
/s/
11
00250237.AP0
