AMENDED AND RESTATED
INVESTMENT ADVISORY AGREEMENT
AMENDED AND RESTATED AGREEMENT made the 1ST day of January, 2005, by and
between OPPENHEIMER INTERNATIONAL BOND FUND (hereinafter referred to as the
"Fund"), and OPPENHEIMERFUNDS, INC. (hereinafter referred to as "OFI").
WHEREAS, the Fund is a open-end, diversified management investment company
registered as such with the Securities and Exchange Commission (the
"Commission") pursuant to the Investment Company Act of 1940 (the "Investment
Company Act"), and OFI is an investment adviser registered as such with the
Commission under the Investment Advisors Act of 1940;
WHEREAS, the Fund desires that OFI shall act as its investment adviser
pursuant to this Agreement;
NOW, THEREFORE, in consideration of the mutual promises and covenants
hereinafter set forth, it is agreed by and between the parties, as follows:
1. General Provision.
The Fund hereby employs OFI and OFI hereby undertakes to act as the
investment adviser of the Fund and to perform for the Fund such other duties
and functions as are hereinafter set forth. OFI shall, in all matters, give
to the Fund and its Board of Trustees the benefit of its best judgment,
effort, advice and recommendations and shall, at all times conform to, and
use its best efforts to enable the Fund to conform to (i) the provisions of
the Investment Company Act and any rules or regulations thereunder; (ii) any
other applicable provisions of state or Federal law; (iii) the provisions of
the Declaration of Trust and By-Laws of the Fund as amended from time to
time; (iv) policies and determinations of the Board of Trustees of the Fund;
(v) the fundamental policies and investment restrictions of the Fund as
reflected in its registration statement under the Investment Company Act or
as such policies may, from time to time, be amended by the Fund's
shareholders; and (vi) the Prospectus and Statement of Additional Information
of the Fund in effect from time to time. The appropriate officers and
employees of OFI shall be available upon reasonable notice for consultation
with any of the Trustees and officers of the Fund with respect to any
matters dealing with the business and affairs of the Fund including the
valuation of portfolio securities of the Fund which are either not registered
for public sale or not traded on any securities market.
2. Investment Management.
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(a) OFI shall, subject to the direction and control by the Fund's Board
of Trustees, (i) regularly provide investment advice and recommendations to
the Fund with respect to its investments, investment policies and the
purchase and sale of securities; (ii) supervise continuously the investment
program of the Fund and the composition of its portfolio and determine what
securities shall be purchased or sold by the Fund; and (iii) arrange, subject
to the provisions of paragraph 7 hereof, for the purchase of securities and
other investments for the Fund and the sale of securities and other
investments held in the Fund's portfolio.
(b) Provided that the Fund shall not be required to pay any
compensation for services under this Agreement other than as provided by the
terms of this Agreement and subject to the provisions of paragraph 7 hereof,
OFI may obtain investment information, research or assistance from any other
person, firm or corporation to supplement, update or otherwise improve its
investment management services.
(c) Provided that nothing herein shall be deemed to protect OFI from
willful misfeasance, bad faith or gross negligence in the performance of its
duties, or reckless disregard of its obligations and duties under this
Agreement, OFI shall not be liable for any loss sustained by reason of good
faith errors or omissions in connection with any matters to which this
Agreement relates.
(d) Nothing in this Agreement shall prevent OFI or any officer thereof
from acting as investment adviser for any other person, firm or corporation
or in any way limit or restrict OFI or any of its directors, officers,
stockholders or employees from buying, selling or trading any securities for
its or their own account or for the account of others for whom it or they may
be acting, provided that such activities will not adversely affect or
otherwise impair the performance by OFI of its duties and obligations under
this Agreement.
3. Other Duties of OFI.
OFI shall, at its own expense, provide and supervise the activities of
all administrative and clerical personnel as shall be required to provide
effective corporate administration for the Fund, including the compilation
and maintenance of such records with respect to its operations as may
reasonably be required; the preparation and filing of such reports with
respect thereto as shall be required by the Commission; composition of
periodic reports with respect to operations of the Fund for its shareholders;
composition of proxy materials for meetings of the Fund's shareholders; and
the composition of such registration statements as may be required by Federal
and state securities laws for continuous public sale of shares of the Fund.
OFI shall, at its own cost and expense, also provide the Fund with adequate
office space, facilities and equipment. OFI shall, at its own expense,
provide such officers for the Fund as the Board of Trustees may request.
4. Allocation of Expenses.
All other costs and expenses of the Fund not expressly assumed by OFI
under this Agreement, or to be paid by the Distributor of the shares of the
Fund, shall be paid by the Fund, including, but not limited to: (i) interest
and taxes; (ii) brokerage commissions; (iii) insurance premiums for fidelity
and other coverage requisite to its operations; (iv) compensation and
expenses of its trustees other than those affiliated with OFI; (v) legal and
audit expenses; (vi) custodian and transfer agent fees and expenses; (vii)
expenses incident to the redemption of its shares; (viii) expenses incident
to the issuance of its shares against payment therefor by or on behalf of the
subscribers thereto; (ix) fees and expenses, other than as hereinabove
provided, incident to the registration under Federal and state securities
laws of shares of the Fund for public sale; (x) expenses of printing and
mailing reports, notices and proxy materials to shareholders of the Fund;
(xi) except as noted above, all other expenses incidental to holding meetings
of the Fund's shareholders; and (xii) such extraordinary non-recurring
expenses as may arise, including litigation, affecting the Fund and any legal
obligation which the Fund may have to indemnify its officers and trustees
with respect thereto. Any officers or employees of OFI or any entity
controlling, controlled by or under common control with OFI who also serve as
officers, trustees or employees of the Fund shall not receive any
compensation from the Fund for their services.
5. Compensation of OFI.
The Fund agrees to pay OFI and OFI agrees to accept as full compensation
for the performance of all functions and duties on its part to be performed
pursuant to the provisions hereof, a fee computed on the aggregate net asset
value of the shares of the Fund as of the close of each business day and
payable monthly at the following annual rate:
.75% of the first $200 million of net assets;
.72% of the next $200 million;
.69% of the next $200 million;
.66% of the next $200 million;
.60% of the next $200 million; and
.50% of net assets in excess of $1 billion.
6. Use of Name "Xxxxxxxxxxx."
OFI hereby grants to the Fund a royalty-free, non-exclusive license to
use the name "Xxxxxxxxxxx" in the name of the Fund for the duration of this
Agreement and any extensions or renewals thereof. To the extent necessary to
protect OFI's rights to the name "Xxxxxxxxxxx" under applicable law, such
license shall allow OFI to inspect and, subject to control by the Fund's
Board, control the nature and quality of services offered by the Fund under
such name and may, upon termination of this Agreement, be terminated by OFI,
in which event the Fund shall promptly take whatever action may be necessary
to change its name and discontinue any further use of the name "Xxxxxxxxxxx"
in the name of the Fund or otherwise. The name "Xxxxxxxxxxx" may be used or
licensed by OFI in connection with any of its activities, or licensed by OFI
to any other party.
7. Portfolio Transactions and Brokerage.
(a) OFI is authorized, in arranging the purchase and sale of the Fund's
portfolio securities, to employ or deal with such members of securities or
commodities exchanges, brokers or dealers (hereinafter "broker-dealers"),
including "affiliated" broker-dealers (as that term is defined in the
Investment Company Act), as may, in its best judgment, implement the policy
of the Fund to obtain, at reasonable expense, the "best execution" (prompt
and reliable execution at the most favorable security price obtainable) of
the Fund's portfolio transactions as well as to obtain, consistent with the
provisions of subparagraph (c) of this paragraph 7, the benefit of such
investment information or research as will be of significant assistance to
the performance by OFI of its investment management functions.
(b) OFI shall select broker-dealers to effect the Fund's portfolio
transactions on the basis of its estimate of their ability to obtain best
execution of particular and related portfolio transactions. The abilities of
a broker-dealer to obtain best execution of particular portfolio
transaction(s) will be judged by OFI on the basis of all relevant factors
and considerations including, insofar as feasible, the execution capabilities
required by the transaction or transactions; the ability and willingness of
the broker-dealer to facilitate the Fund's portfolio transactions by
participating therein for its own account; the importance to the Fund of
speed, efficiency or confidentiality; the broker-dealer's apparent
familiarity with sources from or to whom particular securities might be
purchased or sold; as well as any other matters relevant to the selection of
a broker-dealer for particular and related transactions of the Fund.
(c) OFI shall have discretion, in the interests of the Fund, to
allocate brokerage on the Fund's portfolio transactions to broker-dealers,
other than an affiliated broker-dealer, qualified to obtain best execution of
such transactions who provide brokerage and/or research services (as such
services are defined in Section 28(e)(3) of the Securities Exchange Act of
1934) for the Fund and/or other accounts for which OFI or its affiliates
exercise "investment discretion" (as that term is defined in Section 3(a)(35)
of the Securities Exchange Act of 1934) and to cause the Fund to pay such
broker-dealers a commission for effecting a portfolio transaction for the
Fund that is in excess of the amount of commission another broker-dealer
adequately qualified to effect such transaction would have charged for
effecting that transaction, if OFI determines, in good faith, that such
commission is reasonable in relation to the value of the brokerage and/or
research services provided by such broker-dealer, viewed in terms of either
that particular transaction or the overall responsibilities of OFI or its
affiliates with respect to the accounts as to which they exercise investment
discretion. In reaching such determination, OFI will not be required to
place or attempt to place a specific dollar value on the brokerage and/or
research services provided or being provided by such broker-dealer. In
demonstrating that such determinations were made in good faith, OFI shall be
prepared to show that all commissions were allocated for purposes
contemplated by this Agreement and that the total commissions paid by the
Fund over a representative period selected by the Fund's trustees were
reasonable in relation to the benefits to the Fund.
(d) OFI shall have no duty or obligation to seek advance competitive
bidding for the most favorable commission rate applicable to any particular
portfolio transactions or to select any broker-dealer on the basis of its
purported or "posted" commission rate but will, to the best of its ability,
endeavor to be aware of the current level of the charges of eligible
broker-dealers and to minimize the expense incurred by the Fund for effecting
its portfolio transactions to the extent consistent with the interests and
policies of the Fund as established by the determinations of the Board of
Trustees of the Fund and the provisions of this paragraph 7.
(e) The Fund recognizes that an affiliated broker-dealer: (i) may act
as one of the Fund's regular brokers for the Fund so long as it is lawful for
it so to act; (ii) may be a major recipient of brokerage commissions paid by
the Fund; and (iii) may effect portfolio transactions for the Fund only if
the commissions, fees or other remuneration received or to be received by it
are determined in accordance with procedures contemplated by any rule,
regulation or order adopted under the Investment Company Act for determining
the permissible level of such commissions.
8. Duration.
This Agreement will take effect on the date first set forth above.
Unless earlier terminated pursuant to paragraph 10 hereof, this Agreement
shall remain in effect from year to year, so long as such continuance shall
be approved at least annually by the Fund's Board of Trustees, including the
vote of the majority of the trustees of the Fund who are not parties to this
Agreement or "interested persons" (as defined in the Investment Company Act)
of any such party, cast in person at a meeting called for the purpose of
voting on such approval, or by the holders of a "majority" (as defined in the
Investment Company Act) of the outstanding voting securities of the Fund and
by such a vote of the Fund's Board of Trustees.
9. Disclaimer of Shareholder or Trustee Liability.
OFI understands and agrees that the obligations of the Fund under this
Agreement are not binding upon any shareholder or Trustee of the Fund
personally, but bind only the Fund and the Fund's property; OFI represents
that it has notice of the provisions of the Declaration of Trust of the Fund
disclaiming shareholder or Trustee liability for acts or obligations of the
Fund.
10. Termination.
This Agreement may be terminated (i) by OFI at any time without penalty
upon sixty days' written
notice to the Fund (which notice may be waived by the Fund); or (ii) by the
Fund at any time without penalty upon sixty days' written notice to OFI
(which notice may be waived by OFI) provided that such termination by the
Fund shall be directed or approved by the vote of a majority of all of the
trustees of the Fund then in office or by the vote of the holders of a
"majority" of the outstanding voting securities of the Fund (as defined in
the Investment Company Act).
11. Assignment or Amendment.
This Agreement may not be amended or the rights of OFI hereunder sold,
transferred, pledged or otherwise in any manner encumbered without the
affirmative vote or written consent of the holders of the "majority" of the
outstanding voting securities of the Fund. This Agreement shall
automatically and immediately terminate in the event of its "assignment," as
defined in the Investment Company Act.
12. Definitions.
The terms and provisions of the Agreement shall be interpreted and
defined in a manner consistent with the provisions and definitions contained
in the Investment Company Act.
XXXXXXXXXXX INTERNATIONAL BOND FUND
By: /s/ Xxxxxx X. Xxxx
Xxxxxx X. Xxxx
Vice President and
Secretary
OPPENHEIMERFUNDS, INC.
By: /s/ Xxxx X. Xxxxxx
Xxxx X. Xxxxxx
Chairman, President &
Chief Executive Officer
