INVESTMENT
MANAGEMENT AGREEMENT
BETWEEN
X. XXXX PRICE INTERNATIONAL INDEX FUND, INC.
AND
X. XXXX PRICE INTERNATIONAL, INC.
INVESTMENT
MANAGEMENT AGREEMENT, made as of the 25th day of October, 2000, by and between X. XXXX PRICE INTERNATIONAL
INDEX FUND, INC., consisting of its series, X. Xxxx Price International Equity Index Fund, a Maryland
corporation (hereinafter called the “Corporation”), and X. XXXX PRICE INTERNATIONAL, INC., a corporation organized
and existing under the laws of the State of Maryland (hereinafter called the “Manager”).
W I T N E S S E T H:
WHEREAS,
the Corporation is engaged in business as an open-end management investment company and is registered
as such under the federal Investment Company Act of 1940, as amended (the “Act”); and
WHEREAS,
the Manager is engaged principally in the business of rendering investment supervisory services and is
registered as an investment adviser under the federal Investment Advisers Act of 1940, as amended; and
WHEREAS, the Fund desires the Manager to render investment
supervisory servivces to the Fund in the manner and on the terms and conditions hereinafter set forth;
NOW,
THEREFORE, in consideration of the premises and the mutual promises hereinafter set forth, the parties
hereto agree as follows:
1. DUTIES AND RESPONSIBILITIES OF MANAGER.
A.
INVESTMENT MANAGEMENT SERVICES. The Manager shall act as investment manager and shall supervise and direct
the investments of the Fund in accordance with the Fund’s investment objective, program and restrictions
as provided in the Corporation’s prospectus, on behalf of the Fund, as amended from time to time, and
such other limitations as the Corporation may impose by notice in writing to the Manager. The Manager
shall obtain and evaluate such information relating to the economy, industries, businesses, securities
markets and securities as it may deem necessary or useful in the discharge of its obligations hereunder
and shall formulate and implement a continuing program for the management of the assets and resources
of the Fund in a manner consistent with its investment objective. In furtherance of this duty, the Manager,
as agent and attorney-in-fact with respect to the Corporation, is authorized, in its discretion and without
prior consultation with the Corporation, to:
(i) buy,
sell, exchange, convert, lend, and otherwise trade in any stocks, bonds, and other securities or assets;
and
(ii) place orders
and negotiate the commissions (if any) for the execution of transactions in securities with or through
such brokers, dealers, underwriters or issuers as the Manager may select.
B.
FINANCIAL, ACCOUNTING, AND ADMINISTRATIVE SERVICES. The Manager shall maintain the existence and records
of the Corporation; maintain the registrations and qualifications of Fund Shares under federal and state
law; monitor the financial, accounting, and administrative functions of the Fund; maintain liaison with the various agents employed
for the benefit of the Fund by the Corporation (including the Fund’s transfer agent,
custodian,
independent accountants and legal counsel) and assist in the coordination of their activities on behalf
of the Fund.
C. REPORTS TO FUND. The Manager shall
furnish to or place at the disposal of the Corporation or Fund, as appropriate, such information, reports,
evaluations, analyses and opinions as the Fund may, at any time or from time to time, reasonably request
or as the Manager may deem helpful.
D. REPORTS AND
OTHER COMMUNICATIONS TO SHAREHOLDERS. The Manager shall assist in developing all general shareholder
communications, including regular shareholder reports.
E. FUND PERSONNEL. The Manager agrees to permit individuals
who are officers or employees of the Manager to serve (if duly elected or appointed) as officers, directors,
members of any committee of directors, members of any advisory board, or members of any other committee
of the Corporation, without remuneration or other cost to the Fund or the Corporation.
F.
PERSONNEL, OFFICE SPACE, AND FACILITIES OF MANAGER. The Manager at its own expense shall furnish or provide
and pay the cost of such office space, office equipment, office personnel, and office services as the
Manager requires in the performance of its investment advisory and other obligations under this Agreement.
2.
ALLOCATION OF EXPENSES.
The Manager shall pay all of the Corporation expenses, on behalf of the Fund, with
the following exceptions:
(1) INTEREST. Interest;
(2)
TAXES. All taxes or governmental fees payable by or with respect of the Fund to federal, state, or other
governmental agencies, domestic or foreign, including stamp or other transfer taxes;
(3)
BROKERAGE COMMISSIONS. All brokers’ commissions and other charges incident to the purchase, sale, or
lending of the Fund’s portfolio securities;
(4) DIRECTORS’
FEES AND EXPENSES. All compensation of directors, other than those AFFILIATED with the Manager, and all
expenses (including counsel fees and expenses) incurred in connection with their service; and
(5)
NONRECURRING AND EXTRAORDINARY EXPENSES. Such nonrecurring expenses as may arise, including the costs
of actions, suits, or proceedings to which the Fund is a party and the expenses the Fund may incur as
a result of its legal obligation to provide indemnification to its officers, directors, and agents.
3.
MANAGEMENT FEE. The Fund shall pay the Manager a fee (“Fee”) at the annual rate of 0.50% of the Fund’s net assets. The Fee shall
be paid monthly to the Manager on the first business day of the next succeeding calendar month and shall
be calculated as follows: The monthly fee is equal to the sum of the daily fee accruals which shall be
computed by multiplying the fraction of one (1) over the number of calendar days in the year by the fee
rate of 0.50%, and multiplying this product by the net assets of Fund for that day as determined in accordance
with the Fund’s prospectus as of the close of business from the previous business day on which the
Fund was open for business.
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A. PRORATION OF FEE. If this Agreement becomes effective or
terminates before the end of any month, the Fee for the period from the effective date to the end of
such month or from the beginning of such month to the date of termination, as the case may be, shall
be prorated according to the proportion which such period bears to the full month in which such effectiveness
or termination occurs.
4. SHAREHOLDER ACCOUNT FEE. The Corporation, on behalf of the Fund, by resolution of
the board of directors, including a majority of the independent directors, may from time to time authorize
the imposition of a fee as a direct charge against shareholder accounts to be retained by the Fund or
to be paid to the Manager to defray expenses which would otherwise be paid by the Manager in accordance
with the provisions of Paragraph 2 of this Agreement. At least 60 days’ prior written notice of the
intent to impose such fee must be given to the Fund’s shareholders.
5. BROKERAGE. Subject to the
approval of the board of directors of the Fund, the Manager, in carrying out its duties under Paragraph
1.A., may cause the Corporation, with respect to the Fund, to pay a broker-dealer which furnishes brokerage
or research services [as such services are defined under Section 28(e) of the Securities Exchange Act
of 1934, as amended (the “‘34 Act”)] a higher commission than that which might be charged by another
broker-dealer which does not furnish brokerage or research services or which furnishes brokerage or research
services deemed to be of lesser value, if such commission is deemed reasonable in relation to the brokerage
and research services provided by the broker-dealer, viewed in terms of either that particular transaction
or the overall responsibilities of the Manager with respect to the accounts as to which it exercises
investment discretion (as such term is defined under Section 3(a)(35) of the ‘34 Act).
6. MANAGER’S USE OF THE
SERVICES OF OTHERS. The Manager may (at its cost except as contemplated by Paragraph 4 of this Agreement)
employ, retain or otherwise avail itself of the services or facilities of other persons or organizations
for the purpose of providing the Manager or the Corporation or Fund, as appropriate, with such statistical
and other factual information, such advice regarding economic factors and trends, such advice as to occasional
transactions in specific securities or such other information, advice or assistance as the Manager may
deem necessary, appropriate or convenient for the discharge of its obligations hereunder or otherwise
helpful to the Corporation or Fund, as appropriate, or in the discharge of Manager’s overall responsibilities
with respect to the other accounts which it serves as investment manager.
7. OWNERSHIP OF RECORDS. All
records required to be maintained and preserved by the Corporation or Fund pursuant to the provisions
of rules or regulations of the Securities and Exchange Commission under Section 31(a) of the Act and
maintained and preserved by the Manager on behalf of the Corporation or Fund, as appropriate, are the
property of the Corporation or Fund, as appropriate, and will be surrendered by the Manager promptly
on request by the Corporation or Fund, as appropriate.
8. REPORTS TO MANAGER. The Corporation or Fund,
as appropriate, shall furnish or otherwise make available to the Manager such prospectuses, financial
statements, proxy statements, reports, and other information relating to the business and affairs of
the Corporation or Fund, as appropriate, as the Manager may, at any time or from time to time, reasonably
require in order to discharge its obligations under this Agreement.
9. SERVICES TO OTHER CLIENTS. Nothing herein
contained shall limit the freedom of the Manager or any affiliated person of the Manager to render investment
supervisory and corporate administrative services to other investment companies, to act as investment
manager or investment counselor to other persons, firms or corporations, or to engage in other business
activities; but so long as this Agreement or any extension, renewal or amendment hereof shall remain
in effect or until the Manager shall otherwise consent, the Manager shall be the only investment manager
to the Fund.
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10.
LIMITATION OF LIABILITY OF MANAGER. Neither the Manager nor any of its officers, directors, or employees,
nor any person performing executive, administrative, trading, or other functions for the Corporation
or Fund (at the direction or request of the Manager) or the Manager in connection with the Manager’s
discharge of its obligations undertaken or reasonably assumed with respect to this Agreement, shall be
liable for any error of judgment or mistake of law or for any loss suffered by the Corporation or Fund
in connection with the matters to which this Agreement relates, except for loss resulting from willful
misfeasance, bad faith, or gross negligence in the performance of its or his duties on behalf of the
Corporation or Fund or from reckless disregard by the Manager or any such person of the duties of the
Manager under this Agreement.
11. USE OF MANAGER’S NAME. The Corporation or Fund may use the name “X. Xxxx Price
International Index Fund, Inc.,” or any other name derived from the name of “X. Xxxx Price” 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 the Manager
as investment manager. 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 Corporation or Fund will (by corporate
action, if necessary) cease to use any name derived from the name “X. Xxxx Price,” any name similar
thereto or any other name indicating that it is advised by or otherwise connected with the Manager, or
with any organization which shall have succeeded to the Manager’s business as investment manager.
12.
TERM OF AGREEMENT. The term of this Agreement shall begin on the date first above written, and unless
sooner terminated as hereinafter provided, this Agreement shall remain in effect through April 30, 2001.
Thereafter, this Agreement shall continue in effect from year to year, with respect to the Fund, subject
to the termination provisions and all other terms and conditions hereof, so long as: (a) such continuation
shall be specifically approved at least annually by the board of directors of the Corporation, or by
vote of a majority of the outstanding voting securities of the Fund and, concurrently with such approval
by the board of directors or prior to such approval by the holders of the outstanding voting securities
of the Fund, as the case may be, by the vote, cast in person at a meeting called for the purpose of voting
on such approval, of a majority of the directors of the Corporation, with respect to the Fund, who are
not parties to this Agreement or interested persons of any such party; and (b) the Manager shall not
have notified the Corporation, in writing, at least 60 days prior to April 30, 2001 or prior to April
30th of any year thereafter, that it does not desire such continuation. The Manager shall furnish to
the Corporation, promptly upon its request, such information as may reasonably be necessary to evaluate
the terms of this Agreement or any extension, renewal or amendment hereof.
13. AMENDMENT AND ASSIGNMENT
OF AGREEMENT. This Agreement may not be amended or assigned without the affirmative vote of a majority
of the outstanding voting securities of the Fund, and this Agreement shall automatically and immediately
terminate in the event of its assignment.
14. TERMINATION OF AGREEMENT. This Agreement may be terminated
by either party hereto, without the payment of any penalty, upon 60 days’ prior notice in writing to
the other party; provided, that in the case of termination by the Corporation, with respect to the Fund,
such action shall have been authorized by resolution of a majority of the directors who are not parties
to this Agreement or interested persons of any such party, or by vote of a majority of the outstanding
voting securities of the Fund.
15. MISCELLANEOUS.
A. CAPTIONS. The
captions in this Agreement are included for convenience of reference only and in no way define or delineate
any of the provisions hereof or otherwise affect their construction or effect.
B.
INTERPRETATION. Nothing herein contained shall be deemed to require the Corporation to take any action
contrary to its Articles of Incorporation or By-Laws, or any applicable statutory or regulatory requirement
to which it is subject or by which it is bound, or to relieve or deprive the board of directors of the
Corporation of its responsibility for and control of the conduct of the affairs of the Fund.
C.
DEFINITIONS. Any question of interpretation of any term or provision of this Agreement having a counterpart
in or otherwise derived from a term or provision of the Act shall be resolved by reference to such term
or provision of the Act and to interpretations thereof, if any, by the United States courts or, in the
absence of any controlling decision of any such court, by rules, regulations or orders of the Securities
and Exchange Commission validly issued pursuant to the Act. Specifically, the terms “vote of a majority
of the outstanding voting securities,” “interested person,” “assignment,” and “affiliated
person,” as used in Paragraphs 2, 8, 11, 12, and 13 hereof, shall
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have
the meanings assigned to them by Section 2(a) of the Act. In addition, where the effect of a requirement
of the Act reflected in any provision of this Agreement is relaxed by a rule, regulation or order of
the Securities and Exchange Commission, whether of special or of general application, such provision
shall be deemed to incorporate the effect of such rule, regulation or order.
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be signed by their respective officers
thereunto duly authorized and their respective seals to be hereunto affixed, as of the day and year first
above written.
| | |
Attest: | X. XXXX
PRICE INTERNATIONAL INDEX FUND, INC. |
/s/Xxxxxxxx
X. Xxxxxxx
____________________________
Xxxxxxxx
X. Xxxxxxx, Secretary
|
By: /s/M. Xxxxx
Xxxxx
______________________________
M. Xxxxx Xxxxx, President
|
| | |
Attest: | X.
XXXX PRICE ASSOCIATES, INC. |
/s/Xxxxxxx
X. Xxx Xxxx
______________________________
Xxxxxxx
X. Xxx Xxxx, Assistant Secretary |
By: /s/Xxxxx X. Xxxxxxx
______________________________
Xxxxx X. Xxxxxxx
|
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