EXHIBIT (d)(2)(R)
DRAFT
PORTFOLIO MANAGEMENT AGREEMENT
AGREEMENT made this ____ day of _________, 2000, among The GCG
Trust (the "Trust"), a Massachusetts business trust, Directed
Services, Inc. (the "Manager"), a New York corporation, and Fidelity
Management & Research Company ("Portfolio Manager"), a Massachusetts
corporation.
WHEREAS, the Trust is registered under the Investment Company
Act of 1940, as amended (the "1940 Act"), as an open-end, management
investment company;
WHEREAS, the Trust is authorized to issue separate series, each
of which will offer a separate class of shares of beneficial
interest, each series having its own investment objective or
objectives, policies, and limitations;
WHEREAS, the Trust currently offers shares in multiple series,
may offer shares of additional series in the future, and intends to
offer shares of additional series in the future;
WHEREAS, pursuant to a Management Agreement, effective as of
October 24, 1997, a copy of which has been provided to the Portfolio
Manager, the Trust has retained the Manager to render advisory,
management, and administrative services to many of the Trust's
series;
WHEREAS, the Trust and the Manager wish to retain the Portfolio
Manager to furnish investment advisory services to one or more of the
series of the Trust, and the Portfolio Manager is willing to furnish
such services to the Trust and the Manager;
NOW THEREFORE, in consideration of the premises and the promises
and mutual covenants herein contained, it is agreed between the
Trust, the Manager, and the Portfolio Manager as follows:
1. APPOINTMENT. The Trust and the Manager hereby appoint
Fidelity Management & Research Company to act as Portfolio Manager to
the Series designated on Schedule A of this Agreement (each a
"Series") for the periods and on the terms set forth in this
Agreement. The Portfolio Manager accepts such appointment and agrees
to furnish the services herein set forth for the compensation herein
provided.
In the event the Trust designates one or more series other than
the Series with respect to which the Trust and the Manager wish to
retain the Portfolio Manager to render investment advisory services
hereunder, they shall promptly notify the Portfolio Manager in
writing. If the Portfolio Manager is willing to render such
services, it shall so notify the Trust and Manager in writing,
whereupon such series shall become a Series hereunder, and be subject
to this Agreement.
2. PORTFOLIO MANAGEMENT DUTIES. Subject to the supervision of
the Trust's Board of Trustees and the Manager, the Portfolio Manager
will provide a continuous investment program for each Series'
portfolio and determine the composition of the assets of each Series'
portfolio, including decisions regarding the purchase, retention, or
sale of the securities, cash, and other investments contained in the
portfolio of each Series. The Portfolio Manager will provide
investment research and conduct a continuous program of evaluation,
investment, sales, and reinvestment of each Series' assets by
determining the securities and other investments that shall be
purchased, entered into, sold, closed, or exchanged for the Series,
when these transactions should be executed, and what portion of the
assets of each Series should be held in the various securities and
other investments in which it may invest, and the Portfolio Manager
is hereby authorized to execute and perform such services on behalf
of each Series. The Portfolio Manager will provide the services under
this Agreement in accordance with the Series' investment objective or
objectives, policies, and restrictions as stated in the Trust's
Registration Statement filed with the Securities and Exchange
Commission (the "SEC"), as from time to time amended, copies of which
shall be sent to the Portfolio Manager by the Manager upon filing
with the SEC. The Portfolio Manager shall not be responsible for
administrative affairs of the Series, including but not limited to
accounting for and pricing of the Series. The Portfolio Manager
further agrees as follows:
(a) The Portfolio Manager will use best efforts to (1) manage
each Series so that no action or omission on the part of the
Portfolio Manager will cause a Series to fail to meet the
requirements to qualify as a regulated investment company specified
in Section 851 of the Internal Revenue Code (other than the
requirements for the Trust to register under the 1940 Act and to file
with its tax return an election to be a regulated investment company,
both of which shall not be the responsibility of the Portfolio
Manager), (2) manage each Series so that no action or omission on the
part of the Portfolio Manager shall cause a Series to fail to comply
with the diversification requirements of Section 817(h) of the
Internal Revenue Code and regulations issued thereunder, and (3)
manage the Series so that no action or omission on the part of the
Portfolio Manager shall cause a Series to fail to comply with
applicable federal and state laws, rules and regulations as the
Manager has informed the Portfolio Manager to be applicable to it as
Portfolio Manager of the Series. The Manager will notify the
Portfolio Manager promptly if the Manager believes that a Series is
in violation of any requirement specified in the first sentence of
this paragraph. The Manager or the Trust will notify the Portfolio
Manager of any pertinent changes, modifications to, or
interpretations of Section 817(h) of the Internal Revenue Code and
regulations issued thereunder and of other applicable rules or
regulations pertaining to the Series. The Manager acknowledges and
agrees that the Portfolio Manager's compliance with its obligations
under Sections 2(a)(1) and 2(a)(2) will be based on information
supplied by the Manager or portfolio accounting agent as to each
Series, including but not limited to, portfolio security lot
information.
(b) The Portfolio Manager will perform its duties hereunder
pursuant to the 1940 Act and all rules and regulations thereunder and
the applicable Internal Revenue Code and regulations issued
thereunder, with any applicable procedures adopted by the Trust's
Board of Trustees of which the Portfolio Manager has been notified in
writing, and the provisions of the Registration Statement of the
Trust under the Securities Act of 1933 (the "1933 Act") and the 1940
Act, as supplemented or amended, of which the Portfolio Manager has
received a copy ("Registration Statement").
(c) On occasions when the Portfolio Manager deems the purchase
or sale of a security to be in the best interest of a Series as well
as of other investment advisory clients of the Portfolio Manager or
any of its affiliates, the Portfolio Manager may, to the extent
permitted by applicable laws and regulations, but shall not be
obligated to, aggregate the securities to be so sold or purchased
with those of its other clients where such aggregation is not
inconsistent with the policies set forth in the Registration
Statement. In such event, allocation of the securities so purchased
or sold, as well as the expenses incurred in the transaction, will be
made by the Portfolio Manager in a manner that is fair and equitable
in the judgment of the Portfolio Manager in the exercise of its
fiduciary obligations to the Trust and to such other clients, subject
to policy review by the Manager and the Board of Trustees. The
Portfolio Manager may give advice and take action with respect to
other funds or clients, or for its own account, which may differ from
the advice or the timing or nature of action taken with respect to
the Series.
(d) In connection with the purchase and sale of securities for
a Series, the Portfolio Manager will arrange for the transmission to
the custodian and portfolio accounting agent for the Series on a
daily basis, such confirmation, trade tickets, and other documents
and information, including, but not limited to, Cusip, Sedol, or
other numbers that identify securities to be purchased or sold on
behalf of the Series, as may be reasonably necessary to enable the
custodian and portfolio accounting agent to perform its
administrative and recordkeeping responsibilities with respect to the
Series. With respect to portfolio securities to be purchased or sold
through the Depository Trust Company, the Portfolio Manager will
arrange for the automatic transmission of the confirmation of such
trades to the Trust's custodian and portfolio accounting agent.
(e) The Portfolio Manager will provide reasonable assistance to
the portfolio accounting agent for the Trust in determining or
confirming, consistent with the procedures and policies stated in the
Registration Statement for the Trust, the value of any portfolio
securities or other assets of the Series for which the portfolio
accounting agent seeks assistance from or identifies for review by
the Portfolio Manager, and the parties agree that the Portfolio
Manager shall not bear responsibility or liability for the
determination or accuracy of the valuation of any portfolio
securities and other assets of the Series.
(f) The Portfolio Manager will make available to the Trust and
the Manager, promptly upon request, all of the Series' investment
records and ledgers maintained by the Portfolio Manager (which shall
not include the records and ledgers maintained by the custodian and
portfolio accounting agent for the Trust) as are necessary to assist
the Trust and the Manager to comply with requirements of the 1940 Act
and the Investment Advisers Act of 1940 (the "Advisers Act"), as well
as other applicable laws. The Portfolio Manager will promptly supply
to the Manager copies of any such records upon request.
(g) The Portfolio Manager will provide quarterly and annual
reports to the Trust's Board of Trustees for consideration at
meetings of the Board on the investment program for the Series and
the issuers and securities represented in the Series' portfolio, and
will furnish the Trust's Board of Trustees with respect to the Series
such monthly, quarterly or annual special reports as the Trustees and
the Manager may reasonably request.
(h) In rendering the services required under this Agreement,
the Portfolio Manager may, from time to time, employ or associate
with itself such person or persons as it believes necessary to assist
it in carrying out its obligations under this Agreement. However,
the Portfolio Manager may not retain as subadviser any company that
would be an "investment adviser," as that term is defined in the 1940
Act, to the Series unless the contract with such company is approved
by a majority of the Trust's Board of Trustees and a majority of
Trustees who are not parties to any agreement or contract with such
company and who are not "interested persons," as defined in the 1940
Act, of the Trust, the Manager, or the Portfolio Manager, or any such
company that is retained as subadviser, and is approved by the vote
of a majority of the outstanding voting securities of the applicable
Series of the Trust to the extent required by the 1940 Act. The
Portfolio Manager shall be responsible for making reasonable
inquiries and for reasonably ensuring that any employee of the
Portfolio Manager, any subadviser that the Portfolio Manager has
employed or with which it has associated with respect to the Series,
or any employee thereof has not, to the best of the Portfolio
Manager's knowledge, in any material connection with the handling of
Trust assets:
(i) been convicted, in the last ten (10) years, of any felony
or misdemeanor arising out of conduct involving embezzlement,
fraudulent conversion, or misappropriation of funds or
securities, involving violations of Sections 1341, 1342, or 1343
of Xxxxx 00, Xxxxxx Xxxxxx Code, or involving the purchase or
sale of any security; or
(ii) been found by any state regulatory authority, within the
last ten (10) years, to have violated or to have acknowledged
violation of any provision of any state insurance law involving
fraud, deceit, or knowing misrepresentation; or
(iii) been found by any federal or state regulatory
authorities, within the last ten (10) years, to have violated or
to have acknowledged violation of any provision of federal or
state securities laws involving fraud, deceit, or knowing
misrepresentation.
3. BROKER-DEALER SELECTION. The Portfolio Manager is
responsible for decisions to buy and sell securities and other
investments for each Series' portfolio, broker-dealer selection, and
negotiation of brokerage commission rates. The Portfolio Manager's
primary consideration in effecting a security transaction will be to
obtain the best overall terms for the Series, taking into account the
factors that include the factors it deems relevant including, but not
limited to, price (including the applicable brokerage commission or
dollar spread), the size and character of the order, the nature of
the market for the security, the financial condition of the broker-
dealer involved, the execution and settlement capabilities of the
broker-dealer involved, and the execution services on a continuing
basis. Accordingly, the price to the Series in any transaction may
be less favorable than that available from another broker-dealer if
the difference is reasonably justified, in the judgment of the
Portfolio Manager in the exercise of its fiduciary obligations to the
Trust, by other aspects of the portfolio execution services offered.
Subject to such policies as the Board of Trustees may determine and
consistent with Section 28(e) of the Securities Exchange Act of 1934,
the Portfolio Manager 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 Series to pay a broker-
dealer for effecting a portfolio investment transaction in excess of
the amount of commission another broker-dealer would have charged for
effecting that transaction, if the Portfolio Manager or its affiliate
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-dealer, viewed in terms of either
that particular transaction or the Portfolio Manager's or its
affiliate's overall responsibilities with respect to the Series and
to their other clients as to which they exercise investment
discretion. To the extent consistent with these standards, the
Portfolio Manager is further authorized to allocate the orders placed
by it on behalf of the Series to the Portfolio Manager if it is
registered as a broker-dealer with the SEC, to its affiliated broker-
dealer, or to such brokers and dealers who also provide research or
statistical material, or other services to the Series, the Portfolio
Manager, or an affiliate of the Portfolio Manager. Such allocation
shall be in such amounts and proportions as the Portfolio Manager
shall determine consistent with the above standards, and the
Portfolio Manager will report on said allocation regularly to the
Board of Trustees of the Trust indicating the broker-dealers to which
such allocations have been made and the basis therefor.
4. DISCLOSURE ABOUT PORTFOLIO MANAGER. The Portfolio Manager
has reviewed the post-effective amendment to the Registration
Statement for the Trust filed with the SEC that contains disclosure
about the Portfolio Manager, and represents and warrants that, with
respect to the disclosure about or information relating, directly or
indirectly, to the Portfolio Manager, to the Portfolio Manager's
knowledge, such Registration Statement contains, as of the date
hereof, no untrue statement of any material fact and does not omit
any statement of a material fact which was required to be stated
therein or necessary to make the statements contained therein not
misleading. The Portfolio Manager further represents and warrants
that it is a duly registered investment adviser under the Advisers
Act, or alternatively that it is not required to be a registered
investment adviser under the Advisers Act to perform the duties
described in this Agreement, and that it is a duly registered
investment adviser in all states in which the Portfolio Manager is
required to be registered.
5. EXPENSES. During the term of this Agreement, the Portfolio
Manager will pay all expenses incurred by it and its staff and for
their activities in connection with its portfolio management duties
under this Agreement. The Manager or the Trust shall be responsible
for all the expenses of the Trust's operations including, but not
limited to:
(a) Expenses of all audits by the Trust's independent public
accountants;
(b) Expenses of the Series' transfer agent, registrar, dividend
disbursing agent, and shareholder recordkeeping services;
(c) Expenses of the Series' custodial services including
recordkeeping services provided by the custodian;
(d) Expenses of obtaining quotations for calculating the value
of each Series' net assets;
(e) Expenses of obtaining Portfolio Activity Reports and
Analyses of International Management Reports (as appropriate) for
each Series;
(f) Expenses of maintaining the Trust's tax records;
(g) Salaries and other compensation of any of the Trust's
executive officers and employees, if any, who are not officers,
directors, stockholders, or employees of the Portfolio Manager or an
affiliate of the Portfolio Manager;
(h) Taxes levied against the Trust;
(i) Brokerage fees and commissions in connection with the
purchase and sale of portfolio securities for the Series;
(j) Costs, including the interest expense, of borrowing money;
(k) Costs and/or fees incident to meetings of the Trust's
shareholders, the preparation and mailings of prospectuses and
reports of the Trust to its shareholders, the filing of reports with
regulatory bodies, the maintenance of the Trust's existence, and the
regulation of shares with federal and state securities or insurance
authorities;
(l) The Trust's legal fees, including the legal fees related to
the registration and continued qualification of the Trust's shares
for sale;
(m) Costs of printing stock certificates representing shares of
the Trust;
(n) Trustees' fees and expenses to trustees who are not
officers, employees, or stockholders of the Portfolio Manager or any
affiliate thereof;
(o) The Trust's pro rata portion of the fidelity bond required
by Section 17(g) of the 1940 Act, or other insurance premiums;
(p) Association membership dues;
(q) Extraordinary expenses of the Trust as may arise including
expenses incurred in connection with litigation, proceedings, and
other claims (unless the Portfolio Manager is responsible for such
expenses under Section 14 of this Agreement), and the legal
obligations of the Trust to indemnify its Trustees, officers,
employees, shareholders, distributors, and agents with respect
thereto; and
(r) Organizational and offering expenses.
6. COMPENSATION. For the services provided, the Manager will
pay the Portfolio Manager a fee, payable as described in Schedule B.
7. SEED MONEY. The Manager agrees that the Portfolio Manager
shall not be responsible for providing money for the initial
capitalization of the Series.
8. COMPLIANCE.
(a) The Portfolio Manager shall promptly notify the Manager and
the Trust if (1) the SEC or other governmental authority has censured
the Portfolio Manager; or has commenced proceedings or an
investigation that may result in any of these actions, (2) it has
reason to believe that a Series may fail to qualify as a regulated
investment company under Subchapter M of the Internal Revenue Code,
(3) it has reason to believe that a Series may cease to comply with
the diversification provisions of Section 817(h) of the Internal
Revenue Code or the regulations thereunder; or (4) there is an untrue
or a required omitted statement of fact relating to the Portfolio
Manager in material in the Prospectus or Statement of Additional
Information for the Trust previously supplied by the Portfolio
Manager.
(b) The Manager shall promptly notify the Portfolio Manager and
the Trust if (1) the SEC or other governmental authority has censured
the Manager; or has commenced proceedings or an investigation that
may result in any of these actions, (2) it has reason to believe that
a Series may fail to qualify as a regulated investment company under
Subchapter M of the Internal Revenue Code, or (3) it has reason to
believe that a Series may cease to comply with the diversification
provisions of Section 817(h) of the Internal Revenue Code or the
regulations thereunder.
9. BOOKS AND RECORDS. In compliance with the requirements of
Rule 31a-3 under the 1940 Act, the Portfolio Manager hereby agrees to
maintain and preserve all records related to each Series' portfolio
transactions as are required of a sub-adviser under the Advisers Act
and further agrees to surrender promptly to the Trust any of such
records upon the Trust's or the Manager's request, although the
Portfolio Manager may, at its own expense, make and retain a copy of
such records. The Portfolio Manager further agrees to preserve for
the periods prescribed by Rule 31a-2 under the 1940 Act the records
required to be maintained by Rule 31a-l under the 1940 Act and to
preserve the records required by Rule 204-2 under the Advisers Act
for the period specified in the Rule.
10. COOPERATION. Each party to this Agreement agrees to
cooperate with each other party in connection with any investigation
or inquiry relating to this Agreement or the Trust.
11. REPRESENTATIONS RESPECTING PORTFOLIO MANAGER. During the
term of this Agreement,
(a) the Trust and the Manager agree to furnish to the Portfolio
Manager at its principal offices prior to use thereof copies of all
Registration Statements and amendments thereto, prospectuses, proxy
statements, reports to shareholders, sales literature or other
material prepared for distribution to shareholders of the Trust or
any Series or to the public that refer or relate in any way to the
Portfolio Manager or any of its affiliates (other than the Manager),
or that use any derivative of the name of the Portfolio Manager or
any of its affiliates or any logo associated therewith. The Trust
and the Manager agree that they will not use any such material
without the prior consent of the Portfolio Manager, which consent
shall not be unreasonably withheld. In the event of the termination
of this Agreement, the Trust and the Manager will furnish to the
Portfolio Manager copies of any of the above-mentioned materials that
refer or relate in any way to the Portfolio Manager;
(b) the Trust and the Manager will furnish to the Portfolio
Manager such information relating to either of them or the business
affairs of the Trust as the Portfolio Manager shall from time to time
reasonably request in order to discharge its obligations hereunder;
(c) the Manager and the Trust agree that neither the Trust, the
Manager, nor affiliated persons of the Trust or the Manager shall
give any information or make any representations or statements in
connection with the sale of shares of the Series concerning the
Portfolio Manager or the Series other than the information or
representations contained in the Registration Statement, prospectus,
or statement of additional information for the Trust, as they may be
amended or supplemented from time to time, or in reports or proxy
statements for the Trust, or in sales literature or other promotional
material approved in advance by the Portfolio Manager, except with
the prior permission of the Portfolio Manager.
12. CONTROL. Notwithstanding any other provision of the
Agreement, it is understood and agreed that the Trust shall at all
times retain the ultimate responsibility for and control of all
functions performed pursuant to this Agreement and reserve the right
to direct, approve, or disapprove any action hereunder taken on its
behalf by the Portfolio Manager.
13. SERVICES NOT EXCLUSIVE. It is understood that the services
of the Portfolio Manager are not exclusive, and nothing in this
Agreement shall prevent the Portfolio Manager (or its affiliates)
from providing similar services to other clients, including
investment companies (whether or not their investment objectives and
policies are similar to those of the Series) or from engaging in
other activities.
14. LIABILITY. Except as may otherwise be required by the 1940
Act or the rules thereunder or other applicable law, the Trust and
the Manager agree that the Portfolio Manager, any affiliated person
of the Portfolio Manager, and each person, if any, who, within the
meaning of Section 15 of the 1933 Act, controls the Portfolio Manager
shall not be liable for, or subject to any damages, expenses, or
losses in connection with, any act or omission connected with or
arising out of any services rendered under this Agreement, except by
reason of willful misfeasance, bad faith, or gross negligence in the
performance of the Portfolio Manager's duties, or by reason of
reckless disregard of the Portfolio Manager's obligations and duties
under this Agreement ("Disabling Conduct"). Notwithstanding the
foregoing, the Portfolio Manager, its directors, officers and/or
employees shall not be liable to the Manager or the Trust for any
loss suffered as a consequence of any action or inaction of the
custodian or any other service provider of any Series in failing to
observe the instructions of the Portfolio Manager.
15. INDEMNIFICATION.
(a) Except for Disabling Conduct, the Manager shall indemnify
and hold the Portfolio Manager (and its officers, directors,
employees, controlling persons, shareholders and affiliates
("Indemnified Persons") harmless from any liability arising from the
Portfolio Manager's conduct under this Agreement. The Portfolio
Manager shall indemnify and hold the Manager (and the Manager's
Indemnified Persons) harmless from any liability arising from the
Portfolio Manager's Disabling Conduct or breach of the terms of this
Agreement. The Manager shall not be liable under this paragraph (a)
with respect to any claim made against the Portfolio Manager (and the
Portfolio Manager's Indemnified Persons) unless it received notice
within a reasonable period of time after the Portfolio Manager first
received notice of the claim. The Portfolio Manager shall not be
liable under this paragraph (a) with respect to any claim made
against the Manager (and the Manager's Indemnified Persons) unless it
received notice within a reasonable period of time after the Manager
first received notice of the claim.
(b) Notwithstanding Section 14 of this Agreement, the Manager
shall indemnify and hold the Portfolio Manager (and the Portfolio
Manager's Indemnified Persons) harmless from any liability arising
out of the Manager's responsibilities to the Trust which may be based
upon any untrue statement or alleged untrue statement of a material
fact supplied by, or which is the responsibility of, the Manager and
contained in the Registration Statement or prospectus covering shares
of the Trust or a Series, or any amendment thereof or any supplement
thereto, or the omission or alleged omission to state therein a
material fact known or which should have been known to the Manager
and was required to be stated therein or necessary to make the
statements therein not misleading, unless such statement or omission
was made in reliance upon information furnished to the Manager or the
Trust or to any affiliated person of the Manager by a Portfolio
Manager's Indemnified Person; provided however, that in no case shall
the indemnity in favor of the Portfolio Manager's Indemnified Person
be deemed to protect such person against any liability to which any
such person would otherwise be subject by reason of willful
misfeasance, bad faith, or gross negligence in the performance of its
duties, or by reason of its reckless disregard of obligations and
duties under this Agreement.
(c) Notwithstanding Section 14 of this Agreement, the Portfolio
Manager shall indemnify and hold the Manager (and the Manager's
Indemnified Persons) harmless from any liability arising out of the
Portfolio Manager's responsibilities as Portfolio Manager of a Series
which may be based upon any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement
or prospectus covering the shares of the Trust or a Series, or any
amendment or supplement thereto, or the omission or alleged omission
to state therein a material fact known or which should have been
known to the Portfolio Manager and was required to be stated therein
or necessary to make the statements therein not misleading, if such a
statement or omission was made in reliance upon information furnished
to the Manager, the Trust, or any affiliated person of the Manager or
Trust by the Portfolio Manager or any affiliated person of the
Portfolio Manager; provided, however, that in no case shall the
indemnity in favor of a Manager Indemnified Person be deemed to
protect such person against any liability to which any such person
would otherwise be subject by reason of willful misfeasance, bad
faith, gross negligence in the performance of its duties, or by
reason of its reckless disregard of its obligations and duties under
this Agreement.
16. DURATION AND TERMINATION. This Agreement shall become
effective on the date first indicated above. Unless terminated as
provided herein, the Agreement shall remain in full force and effect
for two (2) years from such date and continue on an annual basis
thereafter with respect to each Series; provided that such annual
continuance is specifically approved each year by (a) the vote of a
majority of the entire Board of Trustees of the Trust, or by the vote
of a majority of the outstanding voting securities (as defined in the
0000 Xxx) of each Series, and (b) the vote of a majority of those
Trustees who are not parties to this Agreement or interested persons
(as such term is defined in the 0000 Xxx) of any such party to this
Agreement cast in person at a meeting called for the purpose of
voting on such approval. The Portfolio Manager shall not provide any
services for such Series or receive any fees on account of such
Series with respect to which this Agreement is not approved as
described in the preceding sentence. However, any approval of this
Agreement by the holders of a majority of the outstanding shares (as
defined in the 0000 Xxx) of a Series shall be effective to continue
this Agreement with respect to such Series notwithstanding (i) that
this Agreement has not been approved by the holders of a majority of
the outstanding shares of any other Series or (ii) that this
agreement has not been approved by the vote of a majority of the
outstanding shares of the Trust, unless such approval shall be
required by any other applicable law or otherwise. Notwithstanding
the foregoing, this Agreement may be terminated for each or any
Series hereunder: (a) by the Manager at any time without penalty,
upon sixty (60) days' written notice to the Portfolio Manager and the
Trust, (b) at any time without payment of any penalty by the Trust,
upon the vote of a majority of the Trust's Board of Trustees or a
majority of the outstanding voting securities of each Series, upon
sixty (60) day's written notice to the Manager and the Portfolio
Manager, or (c) by the Portfolio Manager at any time without penalty,
upon sixty (60) days written notice to the Manager and the Trust. In
addition, this Agreement shall terminate with respect to a Series in
the event that it is not initially approved by the vote of a majority
of the outstanding voting securities of that Series at a meeting of
shareholders at which approval of the Agreement shall be considered
by shareholders of the Series. In the event of termination for any
reason, all records of each Series for which the Agreement is
terminated shall promptly be returned to the Manager or the Trust,
free from any claim or retention of rights in such records by the
Portfolio Manager, although the Portfolio Manager may, at its own
expense, make and retain a copy of such records. The Agreement shall
automatically terminate in the event of its assignment (as such term
is described in the 1940 Act). In the event this Agreement is
terminated or is not approved in the manner described above, the
Sections or Paragraphs numbered 2(f), 9, 10, 11, 14, 15, and 18 of
this Agreement shall remain in effect, as well as any applicable
provision of this Paragraph numbered 16.
17. AMENDMENTS. No provision of this Agreement may be changed,
waived, discharged or terminated orally, but only by an instrument in
writing signed by the party against which enforcement of the change,
waiver, discharge or termination is sought, and no amendment of this
Agreement shall be effective until approved by an affirmative vote of
(i) the holders of a majority of the outstanding voting securities of
the Series, and (ii) the Trustees of the Trust, including a majority
of the Trustees of the Trust who are not interested persons of any
party to this Agreement, cast in person at a meeting called for the
purpose of voting on such approval, if such approval is required by
applicable law.
18. USE OF NAME.
(a) It is understood that the name "Directed Services, Inc." or
any derivative thereof or logo associated with that name is the
valuable property of the Manager and/or its affiliates, and that the
Portfolio Manager has the right to use such name (or derivative or
logo) only with the approval of the Manager and only so long as the
Manager is Manager to the Trust and/or the Series. Upon termination
of the Management Agreement between the Trust and the Manager, the
Portfolio Manager shall as soon as is reasonably possible cease to
use such name (or derivative or logo).
(b) It is understood that the names of the Portfolio Manager
and its affiliates and any of their intellectual property, including
trademarks and logos, are the valuable property of the Portfolio
Manager and its affiliates and that the Trust and/or the Series have
the right to use such name (or derivative or logo) in offering
materials of the Trust with the approval of the Portfolio Manager and
for so long as the Portfolio Manager is a portfolio manager to the
Trust and/or the Series. Upon termination of this Agreement between
the Trust, the Manager, and the Portfolio Manager, the Trust shall as
soon as is reasonably possible cease to use such name (or derivative
or logo).
19. CONFIDENTIALITY. The Manager acknowledges that the
securities holdings of the Series constitute information of value to
the Portfolio Manager, and agrees: (1) not to use for any purpose,
other than to supervise the Portfolio Manager, holdings and other
trading-related information; and (2) not to disclose the Series
holdings as of any given date for at least ten (10) days following
such date, except to the Board of Trustees of the Trust or if
required by applicable law. Further, the Manager agrees that
information supplied by the Portfolio Manager including approved
lists, internal procedures, compliance procedures and other board
materials, is valuable to the Portfolio Manager, and the Manager
agrees not to disclose any of the information contained in such
materials, except to the Board of Trustees, or as required by law, or
as expressly permitted by the Portfolio Manger, in writing, addressed
to the Manager.
20. VOTING RIGHTS. The Manager will be responsible for
exercising any voting rights of any securities of the Series.
21. AMENDED AND RESTATED AGREEMENT AND DECLARATION OF TRUST. A
copy of the Amended and Restated Agreement and Declaration of Trust
for the Trust is on file with the Secretary of the Commonwealth of
Massachusetts. The Amended and Restated Agreement and Declaration of
Trust has been executed on behalf of the Trust by Trustees of the
Trust in their capacity as Trustees of the Trust and not
individually. The obligations of this Agreement shall be binding
upon the assets and property of the Trust and shall not be binding
upon any Trustee, officer, or shareholder of the Trust individually.
22. MISCELLANEOUS.
(a) This Agreement shall be governed by the laws of the
Commonwealth of Pennsylvania, provided that nothing herein shall be
construed in a manner inconsistent with the 1940 Act, the Advisers
Act or rules or orders of the SEC thereunder. The term "affiliate"
or "affiliated person" as used in this Agreement shall mean
"affiliated person" as defined in Section 2(a)(3) of the 0000 Xxx.
(b) The captions of this Agreement are included for convenience
only and in no way define or limit any of the provisions hereof or
otherwise affect their construction or effect.
(c) To the extent permitted under Section 16 of this Agreement,
this Agreement may only be assigned by any party with the prior
written consent of the other parties.
(d) If any provision of this Agreement shall be held or made
invalid by a court decision, statute, rule or otherwise, the
remainder of this Agreement shall not be affected thereby, and to
this extent, the provisions of this Agreement shall be deemed to be
severable.
(e) Nothing herein shall be construed as constituting the
Portfolio Manager as an agent of the Manager, or constituting the
Manager as an agent of the Portfolio Manager.
IN WITNESS WHEREOF, the parties hereto have caused this
instrument to be executed as of the day and year first above written.
THE GCG TRUST
Attest________________________ By:________________________
Title:________________________ Title:_____________________
DIRECTED SERVICES, INC.
Attest________________________ By:________________________
Title:________________________ Title:_____________________
FIDELITY MANAGEMENT & RESEARCH
COMPANY
Attest________________________ By:________________________
Title:________________________ Title:_____________________
SCHEDULE A
The Series of The GCG Trust, as described in Section 1 of the
attached Portfolio Management Agreement, to which Fidelity Management
& Research Company shall act as Portfolio Manager are as follows:
Diversified Mid-Cap Series
Asset Allocation Growth Series
SCHEDULE B
COMPENSATION FOR SERVICES TO SERIES
For the services provided by Fidelity Management & Research
Company ("Portfolio Manager") to the following Series of The GCG
Trust, pursuant to the attached Portfolio Management Agreement, the
Manager will pay the Portfolio Manager a fee, computed daily and
payable monthly, based on the combined average daily net assets of
the Series at the following annual rates of the average daily net
assets of the Series:
SERIES RATE
Diversified Mid-Cap Growth and
Asset Allocation Growth Series: 0.50% of first $250 million in assets;
0.40% of next $500 million in assets; and
0.35% of amount in excess of $750 million
