exhibit d(1)
MANAGEMENT AGREEMENT
MANAGEMENT AGREEMENT, dated as of ________ __, 2004 by and between
CitiFunds Trust I, a Massachusetts business trust (the "Trust"), and Xxxxx
Xxxxxx Fund Management LLC, a Delaware limited liability company ("SBFM" or the
"Manager").
W I T N E S S E T H:
WHEREAS, the Trust engages in business as an open-end management
investment company and is registered as such under the Investment Company Act
of 1940, as amended (collectively with the rules and regulations promulgated
thereunder and any exemptive orders thereunder, the "1940 Act"), and
WHEREAS, the Trust wishes to engage SBFM to provide certain management
services for the series of the Trust designated in Schedule A annexed hereto
(the "Fund"), and SBFM is willing to provide such management services for the
Funds on the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants and agreements of
the parties hereto as herein set forth, the parties covenant and agree as
follows:
1. Duties of Manager. (a) SBFM shall act as the Manager for the Fund and
as such shall furnish continuously an investment program and shall determine
from time to time what securities shall be purchased, sold or exchanged and
what portion of the assets of the Fund shall be held uninvested, subject always
to the restrictions of the Trust's Amended and Restated Declaration of Trust,
dated as of September 28, 2001, and By-Laws, as each may be amended and
restated from time to time (respectively, the "Declaration" and the "By-Laws"),
the provisions of the 1940 Act, and the then-current Registration Statement of
the Trust of the Fund. The Manager shall also make recommendations as to the
manner in which voting rights, rights to consent to corporate action and any
other rights pertaining to the Fund's portfolio securities shall be exercised.
Should the Board of Trustees of the Trust at any time, however, make any
definite determination as to investment policy applicable to the Fund and
notify the Manager thereof in writing, the Manager shall be bound by such
determination for the period, if any, specified in such notice or until
similarly notified that such determination has been revoked. The Manager shall
take, on behalf of the Fund, all actions which it deems necessary to implement
the investment policies determined as provided above, and in particular to
place all orders for the purchase or sale of securities for the Fund's account
with the brokers or dealers selected by it, and to that end the Manager is
authorized as the agent of the Trust to give instructions to the custodian or
any subcustodian of the Fund as to deliveries of securities and payments of
cash for the account of the Fund. In connection with the selection of such
brokers or dealers and the placing of such orders, brokers or dealers may be
selected who also provide brokerage and research services (as those terms are
defined in Section 28(e) of the Securities Exchange Act of 1934) to the Funds
and/or the other accounts over which the Manager or its affiliates exercise
investment discretion. The Manager is authorized to pay a broker or dealer who
provides such brokerage and research services a commission for executing a
portfolio transaction for the Fund which is in excess of the amount of
commission another broker or dealer would have charged for effecting that
transaction if the Manager determines in good faith that such amount of
commission is reasonable in relation to the value of the brokerage and research
services provided by such broker or dealer. This determination may be viewed in
terms of either that particular transaction or the overall responsibilities
which the Manager and its affiliates have with respect to accounts over which
they exercise investment discretion. In making purchases or sales of securities
or other property for the account of the Fund, the Manager may deal with itself
or with the Trustees of the Trust or the Trust's underwriter or distributor or
with its or their respective affiliates, or affiliates of affiliates, to the
extent such actions are permitted by the 1940 Act. In providing the services
and assuming the obligations set forth herein, the Manager may employ, at its
own expense, or may request that the Trust employ at the Fund's expense, one or
more subadvisers; provided that in each case the Manager shall supervise the
activities of each subadviser. Any agreement between the Manager and a
subadviser shall be subject to the renewal, termination and amendment
provisions applicable to this Agreement. Any agreement between the Trust on
behalf of the Fund and a subadviser may be terminated by the Manager at any
time on not more than 60 days' nor less than 30 days' written notice to the
Trust and the subadviser. To the extent authorized by the Board of Trustees and
subject to applicable provisions of the 1940 Act, the investment program to be
provided hereunder may entail the investment of all or a portion of the assets
of a Fund in one or more investment companies.
(b) Subject to the direction and control of the Board of Trustees of the
Trust, SBFM shall perform such administrative and management services as may
from time to time be reasonably requested by the Trust with respect to the
Fund, which shall include without limitation: (i) providing office space,
equipment and clerical personnel necessary for maintaining the organization of
the Trust and the Fund and for performing the administrative and management
functions herein set forth; (ii) supervising the overall administration of the
Fund, including negotiation of contracts and fees with and the monitoring of
performance and xxxxxxxx of the Fund's transfer agent, shareholder servicing
agents, custodian and other independent contractors or agents; and (iii)
arranging for maintenance of books and records of the Trust with respect to the
Fund. Notwithstanding the foregoing, SBFM shall not be deemed to have assumed
any duties with respect to, and shall not be responsible for, the distribution
of shares of beneficial interest in the Fund, nor shall the Manager be deemed
to have assumed or have any responsibility with respect to functions
specifically assumed by any transfer agent, fund accounting agent, custodian or
shareholder servicing agent of the Trust or the Fund. In providing
administrative and management services as set forth herein, the Manager may, at
its own expense, employ one or more subadministrators; provided that the
Manager shall remain fully responsible for the performance of all
administrative and management duties set forth herein and shall supervise the
activities of each subadministrator.
2. Allocation of Charges and Expenses. SBFM shall furnish at its own
expense all necessary services, facilities and personnel in connection with its
responsibilities under Section 1 above. Except as provided in the foregoing
sentence, it is understood that the Trust will pay from the assets of the Fund
all of its own expenses allocable to the Fund including, without limitation,
organization costs of the Fund; compensation of Trustees who are not
"affiliated persons" of SBFM; governmental fees; interest charges; brokerage
fees and commissions; loan commitment fees; taxes; membership dues in industry
associations allocable to the Trust; fees and expenses of independent auditors,
legal counsel and any transfer agent, distributor, shareholder servicing agent,
service agent, registrar or dividend disbursing agent of the Trust; expenses of
issuing and redeeming shares of beneficial interest and servicing shareholder
accounts; expenses of preparing, typesetting, printing and mailing
prospectuses, statements of additional information, shareholder reports,
notices, proxy statements and reports to governmental officers and commissions
and to existing shareholders of the Fund; expenses connected with the
execution, recording and settlement of security transactions; insurance
premiums; fees and expenses of the custodian for all services to the Fund,
including safekeeping of funds and securities and maintaining required books
and accounts; expenses of calculating the net asset value of the Fund
(including but not limited to the fees of independent pricing services);
expenses of meetings of the Fund's Trustees and of the Fund's shareholders;
expenses relating to the registration and qualification of shares of the Fund;
and such non-recurring or extraordinary expenses as may arise, including those
relating to actions, suits or proceedings to which the Trust on behalf of the
Fund may be a party and the legal obligation which the Trust may have to
indemnify its Trustees and officers with respect thereto.
3. Compensation of Manager. For the services to be rendered and the
facilities to be provided by the Manager hereunder, the Trust shall pay to the
Manager from the assets of the Fund a management fee computed daily and paid
monthly at an annual rate equal to the lesser of (i) that percentage of the
Fund's average daily net assets for the Fund's then-current fiscal year set
forth opposite the Fund's name on Schedule A annexed hereto (the "Aggregate
Management Fee"), minus the Fund's Aggregate Subadviser Fee (as defined below),
if any, and (ii) the difference between the Fund's Aggregate Management Fee for
the Fund's then-current fiscal year and the aggregate management fees allocated
to the Fund for the Fund's then-current fiscal year from the registered
investment company portfolios in which it invests (for which the Manager or an
affiliate serves as investment adviser). To the extent that the Fund's
Aggregate Subadviser Fee exceeds the Fund's Aggregate Management Fee, the
Manager shall pay such amount to the applicable subadvisers on the Fund's
behalf. The Fund's Aggregate Subadviser Fee is the aggregate amount payable by
the Fund to subadvisers pursuant to agreements between the Trust on behalf of
the Fund and the subadvisers. If the Manager provides services hereunder for
less than the whole of any period specified in this Section 3, the compensation
to the Manager shall be accordingly adjusted and prorated.
4. Covenants of Manager. The Manager agrees that it will not deal with
itself, or with the Trustees of the Trust or the Trust's principal underwriter
or distributor, as principals in making purchases or sales of securities or
other property for the account of the Fund, except as permitted by the 1940
Act, and will comply with all other provisions of the Declaration and By-Laws
and the then-current Registration Statement applicable to the Fund relative to
the Manager and its directors and officers.
5. Limitation of Liability of Manager. SBFM shall not be liable for any
error of judgment or mistake of law or for any loss arising out of any
investment or for any act or omission in the execution of securities
transactions for a Fund, except for willful misfeasance, bad faith or gross
negligence in the performance of its duties, or by reason of reckless disregard
of its obligations and duties hereunder. As used in this Section 5, the term
SBFM shall include directors, officers and employees of the Manager as well as
the Manager itself.
6. Activities of Manager. The services of the Manager to the Fund are not
to be deemed to be exclusive, the Manager being free to render investment
advisory, administrative and/or other services to others. It is understood that
Trustees, officers, and shareholders of the Trust are or may be or may become
interested in the Manager, as directors, officers, employees, or otherwise and
that directors, officers and employees of the Manager are or may become
similarly interested in the Trust and that the Manager may be or may become
interested in the Trust as a shareholder or otherwise.
7. Duration, Termination and Amendments of this Agreement. This Agreement
shall become effective as of the day and year first above written, shall govern
the relations between the parties hereto thereafter and shall remain in force
for a period of two years from its effectiveness, on which date it will
terminate unless its continuance with respect to a Fund after that date is
"specifically approved at least annually" (a) by the vote of a majority of the
Trustees of the Trust who are not "interested persons" of the Trust or of SBFM
at a meeting specifically called for the purpose of voting on such approval,
and (b) by the Board of Trustees of the Trust or by "vote of a majority of the
outstanding voting securities" of the Fund.
This Agreement may be terminated at any time with respect to the Fund
without the payment of any penalty by the Trustees or by the "vote of a
majority of the outstanding voting securities" of the Fund, or by the Manager,
in each case on not more than 60 days' nor less than 30 days' written notice to
the other party. This Agreement shall automatically terminate in the event of
its "assignment."
This Agreement may be amended with respect to the Fund only if such
amendment is approved by the "vote of a majority of the outstanding voting
securities" of the Fund (except for any such amendment as may be effected in
the absence of such approval without violating the 1940 Act).
The terms "specifically approved at least annually," "vote of a majority
of the outstanding voting securities," "assignment," "affiliated person," and
"interested persons," when used in this Agreement, shall have the respective
meanings specified in, and shall be construed in a manner consistent with, the
1940 Act, subject, however, to such exemptions as may be granted by the
Securities and Exchange Commission under said Act.
8. Licenses. The Trust hereby agrees, on behalf of the Fund, to reimburse
the Manager for any and all reasonable costs incurred by the Manager relating
to the acquisition and retention of licenses to be used in connection with the
management of that Fund.
9. Governing Law. This Agreement shall be construed and the provisions
thereof interpreted under and in accordance with the laws of The Commonwealth
of Massachusetts.
10. Use of Name. The Trust hereby acknowledges that any and all rights in
or to the name "Xxxxx Xxxxxx" which exist on the date of this Agreement or
which may arise hereafter are, and under any and all circumstances shall
continue to be, the sole property of the Manager; that the Manager may assign
any or all of such rights to another party or parties without the consent of
the Trust; and that the Manager may permit other parties, including other
investment companies, to use the word "Xxxxx Xxxxxx" in their names. If the
Manager, or its assignee as the case may be, ceases to serve as the manager of
the Trust, the Trust hereby agrees to take promptly any and all actions which
are necessary or desirable to change its name and those of each of its series
or classes so as to delete the word "Xxxxx Xxxxxx".
Each party acknowledges and agrees that all obligations of the Trust under
this Agreement are binding only with respect to the Fund; that any liability of
the Trust under this Agreement, or in connection with the transactions
contemplated herein, shall be discharged only out of the assets of the Fund;
and that no other series of the Trust shall be liable with respect to this
Agreement or in connection with the transactions contemplated herein.
The undersigned officer of the Trust has executed this Agreement not
individually, but as an officer under the Declaration and the obligations of
this Agreement are not binding upon any of the Trustees, officers or
shareholders of the Trust individually.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered in their names and on their behalf by the undersigned,
thereunto duly authorized, all as of the day and year first above written.
CITIFUNDS TRUST I, XXXXX XXXXXX FUND MANAGEMENT
on behalf of the Fund LLC
By: By:
Title: Title:
Schedule A
Fund Aggregate Management Fee (expressed as a percentage of
the Fund's aggregate net assets for its then-current
fiscal year)
Xxxxx Xxxxxx o 0.95% Equity Fund
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