EXHIBIT (D)(1)
MANAGEMENT AND INVESTMENT ADVISORY AGREEMENT
This MANAGEMENT AND INVESTMENT ADVISORY AGREEMENT dated as of December 3,
1999 by and between EAGLE FUNDS (the "Fund"), a Massachusetts Business Trust,
and XXXXXX & ASSOCIATES, INC. (the "Manager"), a Kansas corporation registered
under the Investment Advisers Act of 1940.
1. (a) Retention of Manager by Fund. The Fund hereby employs the Manager
to act as the investment advisor for and to manage the investment and
reinvestment of the assets of The Nasdaq 100 Index Fund (the "Series"), a series
of the Fund, in accordance with such Series' investment objective and policies
and restrictions, and to administer its affairs to the extent requested by, and
subject to the review and supervision of, the trustees of the Fund (the
"Trustees") for the period and upon the terms herein set forth. The investment
of funds shall be subject to all applicable restrictions of the Agreement and
Declaration of Trust and By-laws of the Fund as may from time to time be in
force.
(b) Manager's Acceptance of Employment and Service Provided. The
Manager accepts such employment and agrees during such period to manage the
investment operations of the Fund and Series, subject to the terms of this
Agreement and to the supervision and control of the Trustees. Manager agrees to
perform or arrange for the performance of the following services with respect to
the Series: to supply investment research; to manage the Series' portfolio
(including without limitation the selection of securities or other investments
for the Series to purchase, hold, lend or sell) in a manner consistent with the
Series' investment objectives, policies and restrictions as set forth in written
documents furnished by the Fund to the Manager, the Fund's Agreement and
Declaration of Trust and By-laws, all securities, commodities and tax laws and
regulations applicable to the Fund and Series, and any other written limitations
or directions furnished by the Trustees to the Manager; to select brokers
through whom the Series' portfolio transactions are executed, in accordance with
the policies adopted by the Series and its Board of Trustees; to administer the
business affairs of the Series; to furnish offices and necessary facilities and
equipment to the Series; to provide clerical, bookkeeping and other
administrative services for the Series (other than those services to be provided
by the Fund's underwriter, custodian, transfer agent and administrator pursuant
to the Fund's agreements with these respective parties on behalf of the Series);
to render periodic reports to the Trustees of the Fund; to permit any of its
officers or employees to serve without compensation as Trustees or officers of
the Fund if elected to such positions; to make available to the Fund promptly
upon request all the Series' records and ledgers and any reports or information
reasonably requested by the Fund; to the extent required by law, to furnish to
regulatory authorities any information or reports relating to the services
provided in this Agreement; to make recommendations as to the manner in which
voting rights, rights to consent to Fund or Series action, and any other rights
pertaining to Fund or the Series shall be exercised; and to use reasonable
efforts to manage the Series so that it will qualify as a regulated investment
company under Subchapter M of the Internal Revenue Code of 1986, as amended.
Except as otherwise instructed from time to time by the Trustees, with
respect to execution of transactions for the Fund on behalf of the Series,
Manager shall place, or arrange for the placement of, all orders for purchases,
sales, or loans with issuers, brokers, dealers or other counterparts or agents
selected by Manager. In connection with the selection of all such parties for
the placement of all such orders, Manager shall attempt to obtain most favorable
execution and price, but may nevertheless in its sole discretion as a secondary
factor, purchase and sell portfolio securities from and to brokers and dealers
who provide Manager with statistical, research and other information, analysis,
advice, and similar services. In recognition of such services or brokerage
services provided by a broker or dealer, Manager is hereby authorized to pay
such broker or dealer a commission or spread in excess of that which might be
charged by another broker or dealer for the same transaction if the Manager
determines in good faith that the commission or spread is reasonable in relation
to the value of the services so provided.
Manager may, where it deems to be advisable, aggregate orders for its other
customers together with any securities of the same type to be sold or purchased
for the Fund or the Series (or other series of the Trust) in order to obtain
best execution or lower brokerage commissions. In such event, Manager shall
allocate the shares so purchased or sold, as well as the expenses incurred in
the transaction, in a manner it considers to be equitable and fair and
consistent with its fiduciary obligation to the Fund, the Series, and Manager's
other customers.
(c) The Manager may, at its option, retain one or more subadvisors at
Manager's own cost and expense for the purpose of providing one or more of the
services of Manager described in this Agreement with respect to the Fund and the
Series; provided, however, that any appointment of a subadvisor shall be subject
to the initial and periodic approvals required under Section 15 of the
Investment Company Act of 1940 (the "1940 Act"). Retention of a subadvisor
shall in no way reduce the responsibilities or obligations of Manager under this
Agreement, and Manager shall be responsible to the Fund and Series for all acts
or omissions of any subadvisor in connection with the performance of Manager's
duties hereunder. The Manager agrees to give the Fund prompt written notice of
any termination of or notice to terminate any subadvisor agreement.
(d) Independent Contractor. The Manager shall be deemed to be an
independent contractor under this Agreement and, unless otherwise expressly
provided or authorized, shall have no authority to act for or represent the Fund
in any way or otherwise be deemed an agent of the Fund.
(e) Non-Exclusive Agreement. The services of the Manager to the Series
under this Agreement are not to be deemed exclusive, and the Manager shall be
free to render similar services or other services to others, so long as its
services hereunder are not impaired thereby.
2. (a) Fee. For the services and facilities described in Section 1, the
Series will pay to the Manager at the end of each calendar month an investment
management fee equivalent on an annual basis to .50 of 1% of its average daily
net assets.
(b) Proration. For the month and year in which this Agreement becomes
effective or terminates, there shall be an appropriate proration of the
Manager's fee on the basis of the number of days that the Agreement is in effect
during such month and year, respectively.
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3. Expenses. Except to the extent expressly assumed by Manager herein or
under a separate agreement between Fund and Manager and except to the extent
required by law to be paid by Manager, Manager shall not be obligated to pay any
costs or expenses incidental to the organization, operations or business of the
Fund. Without limitation, such costs and expenses shall include but not be
limited to: the Manager's fees; any expenses for services rendered by a
custodian, depository or other agency for the safekeeping of the Series'
securities or other property, for keeping its books of account, for any other
charges of the custodian, depository, or other agency and for calculating the
net asset value of the Series as provided in the Agreement and Declaration of
Trust of the Fund; all compensation of the Trustees (other than those affiliated
with the Manager and other than those affiliated with the distributors of the
Fund, if the distributors have agreed to pay such compensation), all expenses
incurred in connection with their services to the Fund, and all expenses of
meetings of the Trustees and committees thereof; charges and expenses of
independent accountants, of legal counsel and of any transfer or dividend
disbursing agent; all brokers' commissions and other costs of acquiring,
disposing or lending of portfolio securities; interest (if any) on obligations
incurred by the Fund; costs of share certificates (if any); membership dues in
the Investment Company Institute or any similar organization; costs of reports
and notices to shareholders; all expenses incidental to holding shareholder
meetings, including printing and of supplying each record-date shareholder with
notice and proxy solicitation material, and all other proxy solicitation
expense; all expenses of printing of annual or more recent revisions of Fund
prospectuses and supplying then-existing shareholders with a copy of a revised
prospectus; all expenses of bond and insurance coverage required by law or
deemed advisable by the Board of Trustees; costs of registering shares of the
Fund and maintaining such registration under the Federal securities laws and of
qualifying and maintaining qualification of Fund and of the Fund's shares for
sale under securities laws of various states or other jurisdictions; all charges
for accounting services provided to Fund by Manager or any other provider of
such services; all charges for equipment or services used for obtaining price
quotations or for communication between Manager or Fund and the custodian,
transfer agent or any other agent selected by the Fund; miscellaneous expenses
and all taxes and fees to federal, state or other governmental agencies,
domestic or foreign, including all stamp or other transfer taxes, and the filing
of corporate documents or otherwise. The Fund shall not pay or incur any
obligation for any management or administrative expenses for which the Fund
intends to seek reimbursement from the Manager without first obtaining the
written approval of the Manager. The Manager shall arrange, if desired by the
Fund, for officers or employees of the Manager to serve, without compensation
from the Fund, as Trustees, officers or agents of the Fund if duly elected or
appointed to such positions and subject to their individual consent and to any
limitations imposed by law.
4. Allocation of Expenses Borne by the Fund. Any expenses borne by the
Fund that are attributable solely to the organization, operation or business of
the Series shall be paid solely out of the Series' assets. Any expense borne by
the Fund which is not solely attributable to the Series, nor solely to any other
series of shares of the Fund, shall be apportioned in such manner as Manager
determines is fair and appropriate, or as otherwise specified by the Board of
Trustees.
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5. Expenses Borne By Manager. Manager at its own expense shall furnish all
executive and other personnel, office space, and office facilities required to
render the investment management and administrative services set forth in this
Agreement.
In the event that Manager pays or assumes any expenses of the Fund or the
Series not required to be paid or assumed by Manager under this Agreement,
Manager shall not be obligated hereby to pay or assume the same or similar
expense in the future; provided that nothing contained herein shall be deemed to
relieve Manager of any obligation to the Fund or the Series under any separate
agreement or arrangement between the parties.
6. Interested Persons. Subject to applicable statutes and regulations, it
is understood that Trustees, officers, shareholders and agents of the Fund are
or may be interested in the Manager as directors, officers, shareholders and
agents or otherwise, and that the directors, officers, shareholders and agents
of the Manager may be interested in the Fund as Trustees, officers,
shareholders, agents or otherwise.
7. Liability. The Manager shall not be liable for any error of judgment or
of law, or for any loss suffered by the Series in connection with the matters to
which this Agreement relates, except a loss resulting from willful misfeasance,
bad faith or gross negligence on the part of the Manager in the performance of
its obligations and duties, or by reason of its reckless disregard of its
obligations and duties under this Agreement.
8. (a) Term. This Agreement shall become effective on the date hereof and
shall remain in full force until the second anniversary of the date hereof
unless sooner terminated as hereinafter provided. This Agreement shall continue
in force from year to year thereafter, but only as long as such continuance is
specifically approved at least annually in the manner required by the 1940 Act.
(b) Termination. This Agreement shall automatically terminate in the
event of its "assignment" as defined in the 1940 Act. This Agreement may be
terminated at any time without the payment of any penalty by the Board of
Trustees of the Fund or by a vote of a majority of the outstanding shares of the
Series, upon sixty (60) days' written notice to the Manager. The Manager may
terminate this Agreement at any time without payment of any penalty upon sixty
(60) days' written notice to the Fund. This Agreement may be terminated at any
time without the payment of any penalty and without advance notice by the
Trustees or by vote of a majority of the outstanding shares of the Series in the
event that it shall have been established by a court or competent jurisdiction
that the Manager or any officer or director of the Manager has taken any action
which results in a breach of the covenants of the Manager set forth herein.
(c) Payment Upon Termination. Termination of this Agreement shall not
affect the right of the Manager to receive payment on any unpaid balance of the
compensation described in Section 2 earned prior to such termination.
9. Amendment. This Agreement may not be amended as to the Fund or the
Series without the affirmative votes (a) of a majority of the Board of Trustees,
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including a majority of those Trustees who are not "interested persons" of the
Fund or of Manager, voting in person at a meeting called for the purpose of
voting on such approval, and (b) of a "majority of the outstanding shares" of
the Series. The terms "interested persons" and "vote of a majority of the
outstanding shares" shall be construed in accordance with their respective
definitions in the 1940 Act and, with respect to the latter term, in accordance
with Rule 18f-2 under the 1940 Act.
10. Ownership of Records; Interparty Reporting. All records required to be
maintained and preserved by the Fund pursuant to the provisions of rules or
regulations of the Securities and Exchange Commission under Section 31(a) of the
1940 Act or other applicable laws or regulations which are maintained and
preserved by Manager on behalf of the Fund and any other records the parties
mutually agree shall be maintained by Manager on behalf of the Fund are the
property of the Fund and shall be surrendered by Manager promptly on request by
the Fund; provided that Manager may at its own expense make and retain copies of
any such records.
The Fund shall furnish or otherwise make available to Manager such copies
of the financial statements, proxy statements, reports, and other information
relating to the business and affairs of each shareholder in the Series as
Manager may, at any time or from time to time, reasonably require in order to
discharge its obligations under this Agreement.
Manager shall prepare and furnish to the Fund as to the Series statistical
data and other information in such form and at such intervals as the Fund may
reasonably request.
11. References and Headings. In this Agreement and in any such amendment,
references to this Agreement and all expressions such as "herein," "hereof," and
"hereunder" shall be deemed to refer to this Agreement as amended or affected by
any such amendments. Headings are placed herein for convenience of reference
only and shall not be taken as a part hereof or control or affect the meaning,
construction, or effect of this Agreement. This Agreement may be executed in
any number of counterparts, each of which shall be deemed an original.
12. Severability. If any provision of this Agreement shall be held or made
invalid by a court decision, statute, rule or otherwise, the remainder shall not
be thereby affected.
13. Notices. Any notice under this Agreement shall be in writing, addressed
and delivered or mailed, postage prepaid, to the other party at such address as
such other party may designate for the receipt of such notice.
14. All parties hereto are expressly put on notice of the Fund's Agreement
and Declaration of Trust dated August 10, 1999, and all amendments thereto, all
of which are on file with the Secretary of The Commonwealth of Massachusetts,
and the limitation of shareholder and Trustee liability contained therein. This
Agreement has been executed by and on behalf of the Fund by its representatives
as, such representatives and not individually, and the obligations of the Fund
or Series hereunder are not binding upon any of the Trustees, officers or
shareholders of the Fund or Series individually but are binding upon only the
assets and property of the respective Series. With respect to any claim by
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Manager for recovery of that portion of the investment management fee (or any
other liability of the Fund arising hereunder) allocated to a particular series,
if there is more than one, whether in accordance with the express terms hereof
or otherwise, the Manager shall have recourse solely against the assets of that
series to satisfy such claim and shall have no recourse against the assets of
any other series for such purpose.
15. Use of the Fund Name. The Fund may use the name "Eagle Funds" or any
other name derived from the name "Eagle" and the Series may use the name listed
above only for so long as this Agreement or any extension, renewal, or amendment
hereof remains in effect, including any similar agreement with any organization
which shall have succeeded to the business of Manager as investment adviser. At
such time as this Agreement or any extension, renewal or amendment hereof, or
such other similar agreement shall no longer be in effect, the Series shall
cease to use the name above and the Fund will cease to use any name derived from
the name "Eagle" or otherwise connected with Manager, or with any organization
which shall have succeeded to Manager's business as investment adviser.
IN WITNESS WHEREOF, the Fund and the Manager have caused this Agreement to
be executed on the day and year first above written.
EAGLE FUNDS
By: /s/ XXXX X. XXXXXXXX
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Xxxx X. Xxxxxxxx
Chairman
XXXXXX & ASSOCIATES, INC.
By: /s/ XXXXX X. XXXXXXXXX
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Xxxxx X. Xxxxxxxxx
President
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