MANAGEMENT AGREEMENT
XXXX XXXXX U.S. GOVERNMENT MONEY MARKET PORTFOLIO
MANAGEMENT AGREEMENT ("Agreement"), made this 1st day of November,
1988, by and between Xxxx Xxxxx Income Trust, Inc. (the "Corporation"), a
Maryland corporation, on behalf of the Xxxx Xxxxx U.S. Government Money Market
Portfolio ("Fund"), and Xxxx Xxxxx Fund Adviser, Inc. (the "Manager"), a
Maryland corporation, having its principal place of business at 000 Xxxxx
Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxx 00000.
WHEREAS, the Corporation is a registered, open-end management
investment company currently consisting of three portfolios; and
WHEREAS, the Corporation wishes to retain the Manager to provide
investment advisory, management, and administrative services to the Fund; and
WHEREAS, the Manager is willing to furnish such services on the terms
and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the promises and mutual covenants
herein contained, it is agreed as follows:
1. Appointment. The Corporation hereby appoints Xxxx Xxxxx Fund
Adviser, Inc. as Manager of the Fund for the period and on the terms set forth
in this Agreement. The Manager accepts such appointment and agrees to render the
services herein set forth, for the compensation herein provided.
2. Delivery of Documents. The Fund shall at all times keep the Manager
fully informed with regard to the securities owned by it, its funds available,
or to become available, for investment, and generally as to the condition of its
affairs. It shall furnish the Manager with such other documents and information
with regard to its affairs as the Manager may from time to time reasonably
request.
3. Management Services. (a) Subject to the supervision of the
Corporation's Board of Directors, the Manager shall regularly provide the Fund
with investment research, advice, management and supervision and shall furnish a
continuous investment program for the Fund's portfolio of securities consistent
with the Fund's investment objective, policies, and limitations as stated in the
Fund's current prospectus and statement of additional information. The Manager
shall determine from time to time what securities will be purchased, retained or
sold by the Fund, and shall implement those decisions, all subject to the
provisions of the Corporation's Articles of Incorporation and
By-laws, the Investment Company Act of 1940, as amended ("xxx 0000 Xxx"), the
applicable rules and regulations of the Securities and Exchange Commission, and
other applicable federal and state law, as well as the investment objective,
policies, and limitations of the Fund. The Manager will place orders pursuant to
its investment determinations for the Fund either directly with the issuer or
with any broker or dealer. In placing orders with brokers and dealers, the
Manager will attempt to obtain the best net price and the most favorable
execution of its orders; however, the Manager may, in its discretion, purchase
and sell portfolio securities from and to brokers and dealers, who provide the
Fund with supplemental investment and market research, securities and economic
analyses, advice and similar services, and the Manager may pay to these brokers
and dealers, in return for research and analysis, a higher brokerage commission
or spread than may be charged by other brokers and dealers. In no instance will
portfolio securities be purchased from or sold to the Manager, or any affiliated
person thereof except in accordance with the 1940 Act or the rules, regulations
or orders promulgated thereunder by the Securities and Exchange Commission. The
Manager shall also provide advice and recommendations with respect to other
aspects of the business and affairs of the Fund, and shall perform such other
functions of management and supervision as may be directed by the Corporation's
Board of Directors.
(b) The Manager will oversee the maintenance of all books and records
with respect to the securities transactions of the Fund and the Fund's books of
account in accordance with all applicable federal and state laws and
regulations, and will furnish the Board of Directors of the Corporation with
such periodic and special reports as the Board reasonably may request.
(c) The Fund authorizes the Manager and any entity or person associated
with the Manager which is a member of a national securities exchange to effect
any transaction on the exchange for the account of the Fund which is permitted
by Section 11(a) of the Securities Exchange Act of 1934 and Rule 11a2-2(T)
thereunder, and the Fund hereby consents to the retention of compensation by
such entity for such transactions in accordance with Rule 11a2-2(T)(a)(2)(iv).
4. Delegation of Duties. The Manager may enter into a contract
("Investment Advisory Agreement") with an investment adviser in which the
Manager delegates to such investment adviser any or all its duties specified in
Paragraph 3 hereunder, provided that such Investment Advisory Agreement imposes
on the investment adviser bound thereby all duties and conditions to which the
Manager is subject hereunder, and further provided that such Investment Advisory
Agreement meets all requirements of the 1940 Act and rules thereunder.
5. (a) Other Services. The Manager, at its expense, shall supply the
Board of Directors and officers of the Corporation with information and reports
reasonably required by them and reasonably available to the Manager and shall
furnish the Fund with
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office facilities, including space, furniture and equipment and all personnel
reasonably necessary for the operation of the Fund.
(b) Books and Records. In compliance with the requirements of
Rule 31a-3 under the 1940 Act, the Manager hereby agrees that all books and
records which it maintains for the Fund are the property of the Fund, and
further agrees to surrender promptly to the Fund or its agents any of such
records upon the Fund's request. The Manager further agrees to preserve for the
periods prescribed by Rule 31a-2 under the 1940 Act and any such records
required to be maintained by Rule 31a-1 under the 1940 Act.
(c) Expenses. Other than as herein specifically indicated, the
Manager shall not be responsible for the Fund's expenses. Specifically, the
Manager will not be responsible, except to the extent of the reasonable
compensation of employees of the Fund whose services may be used by the Manager
hereunder, for any of the following expenses of the Fund, which expenses shall
be borne by the Fund: legal expenses; audit expenses; interest; taxes;
governmental fees; fees, voluntary assessments and other expenses incurred in
connection with membership in investment company organizations; the cost
(including brokerage commissions or charges, if any) of securities purchased or
sold by the Fund and any losses incurred in connection therewith; fees of
custodians, transfer agents, registrars or other agents; expenses of preparing
share certificates; expenses relating to the redemption or repurchase of the
Fund's shares; expenses of registering and qualifying Fund shares for sale under
applicable federal and state law and maintaining such registrations and
qualifications; expenses of preparing, setting in print, printing and
distributing prospectuses, proxy statements, reports, notices and dividends to
Fund shareholders; cost of stationery; costs of shareholders' and other meetings
of the Fund; traveling expenses of officers, directors and employees of the
Corporation, if any; expenses for fidelity bonds and other insurance covering
the Corporation and its officers and directors; distribution expenses; costs of
indemnification and any extraordinary expenses.
(d) Service as Officers of the Corporation. The Manager shall
authorize and permit any of its directors, officers and employees, who may be
elected as directors or officers of the Corporation, to serve in the capacities
in which they are elected, and shall bear their salary or other compensation and
expenses, if any.
6. Compensation of Individuals. No director, officer or employee of the
Corporation shall receive from the Corporation any salary or other compensation
as such director, officer or employee while he is at the same time a director,
officer, or employee of the Manager or any affiliated company of the Manager.
7. Manager's Compensation. As compensation for the services performed,
the facilities furnished and the expenses assumed by the Manager, including the
services of any investment advisers or agents retained by the Manager, the Fund
shall pay the
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Manager monthly, as promptly as possible after the last day of each month, a
fee, calculated daily, at an annual rate equal to 0.50% of the average daily net
assets of the Fund. If this Agreement is terminated as of any date not the last
day of a month, such fee shall be paid as promptly as possible after such date
of termination, shall be based on the average daily net assets of the Fund in
that period from the beginning of such month to such date of termination, and
shall be that proportion of such average daily net assets as the number of
business days in such period bears to the number of business days in such month.
The average daily net assets of the Fund shall in all cases be based only on
calendar days and be computed as of the time of the regular close of business of
the New York Stock Exchange, or such other time as may be determined by the
Corporation's Board of Directors. Each such payment shall be accompanied by a
report of the Fund, prepared either by the Fund or by a reputable firm of
independent accountants, which shall show the amount properly payable to the
Manager under this Agreement and the detailed computation thereof.
8. Limitation of Liability. The Manager shall not be liable for any
error of judgment or mistake of law or for any loss suffered by the Fund in
connection with the performance of this Agreement, except a loss resulting from
a breach of fiduciary duty with respect to the receipt of compensation for
services or losses resulting from willful misfeasance, bad faith, or gross
negligence in the performance of its duties or from reckless disregard of its
obligations and duties hereunder.
9. Services Not Exclusive. Nothing in this Agreement shall limit or
restrict the right of any director, officer, or employee of the Manager who may
also be a director, officer, or employee of the Corporation, to engage in any
other business or to devote his time and attention in part to the management or
other aspects of any other business, whether of a similar nature or a dissimilar
nature, or limit or restrict the right of the Manager to engage in any other
business or to render services of any kind, including investment advisory and
management services, to any other corporation, firm, individual or association.
10. Definitions. As used in this Agreement, the terms "securities" and
"net assets" shall have the meanings ascribed to them in the Articles of
Incorporation of the Corporation; and the terms "assignment", "interested
persons", and "majority of the outstanding voting securities" shall have the
meanings given to them by Section 2(a) of the 1940 Act, subject to such
exemptions and interpretations as may be granted by the Securities and Exchange
Commission by any rule, regulation or order.
11. Duration and Term. This Agreement will become effective on November
1, 1988, provided that it shall have been approved by the Corporation's Board of
Directors, including a majority of the directors who are not "interested
persons" of the Corporation or the Manager, by vote cast in person at a meeting
called for the purpose of voting on such approval, and by the shareholders of
the Fund in accordance with the requirements of the
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1940 Act and, unless sooner terminated as provided herein, will continue in
effect until November 1, 1990. Thereafter, if not terminated, this Agreement
shall continue in effect for successive annual periods, provided that such
continuance is specifically approved at least annually (i) by the Corporation's
Board of Directors or (ii) by a vote of a majority of the outstanding voting
securities of the Fund , provided that in either event the continuance is also
approved by a majority of the Corporation's Directors who are not "interested
persons" of the Corporation or of the Manager, by vote cast in person at a
meeting called for the purpose of voting on such approval.
This Agreement is terminable without penalty, by vote of the
Corporation's Board of Directors, by vote of a majority of the outstanding
voting securities of the Fund or by the Manager, on not less than 60 days'
notice to the other party and may be terminated immediately upon the mutual
written consent of the Manager and the Corporation. Termination of this
Agreement with respect to the Fund shall in no way affect continued performance
with regard to any other portfolio of the Corporation. This Agreement will
automatically and immediately terminate in the event of its assignment.
12. Applicable to Series Only. Manager hereby acknowledges and agrees
that it may not look to the assets of any series of the Corporation other than
the Fund for satisfaction of any obligation or liability arising under this
Agreement.
13. Use of "Xxxx Xxxxx" Name. In the event this Agreement is terminated
by either party or upon written notice from the Manager at any time, the Fund
hereby agrees that it will eliminate from its corporate name any reference to
the name of "Xxxx Xxxxx." The Fund shall have the non-exclusive use of the name
"Xxxx Xxxxx" in whole or in part so long as this Agreement is effective or until
such notice is given.
14. Amendment and Termination. 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 material amendment of this Agreement
shall be effective until approved by vote of the holders of a majority of the
Fund's outstanding voting securities.
15. Miscellaneous. 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. This Agreement shall be binding
upon and shall inure to the benefit of the parties hereto and their respective
successors.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their officers thereunto duly authorized.
Attest: XXXX XXXXX INCOME TRUST, INC.
By: /s/ Xxxxxxx X. Xxxxx By: /s/ Xxxxxx X. Xxxxxxx, Xx.
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Attest: XXXX XXXXX FUND ADVISER, INC.
By: /s/ Xxxxxxx X. Xxxxx By: /s/ Xxxxxxx X. Xxxxxxxxxx
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