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EXHIBIT (d).1
INVESTMENT ADVISORY AND MANAGEMENT AGREEMENT
THIS AGREEMENT, made this 2nd day of April 1993, by and between FORTIS
INCOME PORTFOLIOS, INC.(formerly FORTIS U.S. GOVERNMENT SECURITIES FUND, NC.), a
Minnesota corporation (the "Fund") and FORTIS Advisers, Inc. (formerly AMEV
Advisers, Inc.), a Minnesota ("Advisers").
1. INVESTMENT ADVISORY AND MANAGEMENT SERVICES
The Fund hereby engages Advisers, and Advisers hereby agrees to act, as
investment adviser for, and to manage the affairs, business and the investment
of the assets of the Fund's Portfolios, which shall consist of Fortis U. S.
Government Securities Fund and any further portfolios from time to time created
by the Board of Directors of the Fund. Each such Portfolio is herein
individually referred to as a "Portfolio," and the Portfolios are herein
collectively referred to as the "Portfolios."
The investment of the assets of the Portfolio shall at all times be subject
to the applicable provisions of the Articles of Incorporation, Bylaws,
Registration Statement and current Prospectus and Statement of Additional
Information of the Fund and shall conform to the policies and purposes of the
Fund as set forth in the Registration Statement and Prospectus and Statement of
Additional Information as interpreted from time to time by the Board of
Directors of the Fund. Within the framework of the investment policies of the
Portfolios, Advisers shall have the sole and exclusive responsibility for the
management of the Portfolios and the making and execution of all investment
decisions for the Fund. Advisers shall report to the Board of Directors
regularly at such times and in such detail as the Board may from time to time
determine to be appropriate, in order to permit the Board to determine the
adherence of Advisers to the investment policies of the Portfolios.
Advisers shall, at its own expense, furnish the Fund suitable office space,
and all necessary office facilities, equipment and personnel for servicing the
investments of the Fund. Advisers shall arrange, if requested by the Fund, for
officers, employees or other affiliates of Advisers to serve without
compensation from the Fund as directors, officers, or employees of the Fund if
duly elected to such positions by the shareholders or directors of the Fund.
Advisers hereby acknowledges that all records necessary in the operation of
the Fund, including records pertaining to shareholders and investments, are the
property of the Fund, and in the event that a transfer of management or
investment advisory services to someone other than Advisers should ever occur,
Advisers will promptly, and at its own cost, take all steps necessary to
segregate such records and deliver them to the Fund.
2. COMPENSATION FOR SERVICES.
In payment for all services, facilities, equipment and personnel, and for
other costs of Advisers hereunder, the Fund shall pay to Advisers a monthly fee,
which fee shall be paid to Advisers not later than the fifth business day of the
month following the month in which such services are rendered. Such monthly fee
shall be at the rate or rates set forth below and shall be based on the average
of the net asset values of all of the issued and outstanding shares of the
respective Portfolio as determined as of the close of each business day of the
month pursuant to the Articles of Incorporation, Bylaws and currently effective
Prospectus and Statement of
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Additional Information of the Fund. The following table sets forth the fee on a
monthly and annual basis:
EQUIVALENT
MONTHLY RATE RATE AVERAGE ASSET VALUES OF THE FUND
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U.S. Government Securities Fund 1/15 of 1.0% 8/10 of 1.0% On the first $50,000,000
7/120 of 1.0% 7/10 of 1.0% On average net assets over $100,000,000
The fee shall be prorated for any fraction of a month at the commencement
or termination of this Agreement.
The investment advisory fee for any future Portfolio(s) shall be determined
by the Board of Directors of the Fund upon the creation of any such
Portfolio(s).
3. ALLOCATION OF EXPENSES.
In addition to the fee described in Section 2 hereof, the Fund shall pay
all its expenses which are not assumed by Advisers and/or Fortis Investors, Inc.
("Investors"). These Fund expenses include, by way of example, but not by way of
limitation, the fees and expenses of directors and officers of the Fund who are
not "affiliated persons" of Advisers, interest expenses, taxes, brokerage fees
and commissions, fees and expenses of registering and qualifying the Fund and
its shares for distribution under federal and state securities laws, expenses of
preparing prospectuses and of printing and distributing prospectuses annually to
existing shareholders, custodian charges, auditing and legal expenses, insurance
expenses, association membership dues, and the expenses of reports to
shareholders, shareholders' meetings and proxy solicitations. Advisers shall
bear the costs of acting as the Portfolio's transfer agent, registrar and
dividend disbursing agent.
Advisers or Investors shall bear all promotional expenses in connection
with the distribution of the Fund's shares, including paying for prospectuses
and shareholder reports for new shareholders and the costs of sales literature.
4. FREEDOM TO DEAL WITH THIRD PARTIES.
Advisers shall be free to render services to others similar to those
rendered under this Agreement or of a different nature except as such services
may conflict with the services to be rendered or the duties to be assumed
hereunder.
5. EFFECTIVE DATE, DURATION AND TERMINATION OF AGREEMENT.
The effective date of this Agreement shall be April 2, 1993. Wherever
referred to in this Agreement, the vote or approval of the holders of a majority
of the outstanding voting securities of the Fund shall mean the vote of 67% or
more of such securities if the holders of more than 50% of such securities are
present in person or by proxy or the vote of more than 50% of such securities,
whichever is less.
Unless sooner terminated as hereinafter provided, this Agreement shall
continue in effect only so long as such continuance is specifically approved at
least annually (a) by the Board of Directors of the Fund, or with respect to a
particular Portfolio by the vote of the holders of a majority of the outstanding
voting securities of such Portfolio, and (b) by a majority of the directors who
are not interested persons of Advisers or of the Fund cast in person at a
meeting
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called for the purpose of voting on such approval; provided that if a majority
of the outstanding voting securities of any of the Portfolios approves this
Agreement, this Agreement shall continue in effect with respect to such
approving Portfolio whether or not the shareholders of any other Portfolio of
the Fund approve this Agreement.
This Agreement may be terminated at any time without the payment of any
penalty by the vote of the Board of Directors of the Fund or by Advisers upon
sixty (60) days written notice to the other party. This Agreement may be
terminated with respect to a particular Portfolio at any time without the
payment of any penalty by the vote of the holders of a majority of the
outstanding voting securities of such Portfolios, upon sixty (60) days written
notice to Advisers. Any such termination may be made effective with respect to
both the investment advisory and management services provided for in this
Agreement or with respect to either of such kinds of services. This Agreement
shall automatically terminate in the event of its assignment.
6. AMENDMENTS TO AGREEMENT.
No material amendment to this Agreement shall be effective until
approved by a vote of the holders of a majority of the outstanding voting
securities of the Portfolios which have approved and are subject to this
Agreement. In addition, if a majority of the outstanding voting securities of
any Portfolio of the Fund votes to amend this Agreement, such amendment shall be
effective with respect to such Portfolio whether or not the shareholders of any
other Portfolio vote to adopt such amendment.
7. NOTICES.
Any notice under this Agreement shall be in writing, addressed, delivered
or mailed, postage prepaid, to the other party at such address as such other
party may designate in writing for receipt of such notice.
IN WITNESS WHEREOF, the Fund and Advisers have caused this Agreement to be
executed by their duly authorized officers as of the day and year first above
written.
FORTIS U.S. GOVERNMENT SECURITIES FUND, INC.
By /s/ Xxxx X. Xxxxxxxx
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Its Vice President
FORTIS ADVISERS, INC.
By /s/ Xxxx X. Xxxxxxxx
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Its Vice President
