INVESTMENT ADVISORY AGREEMENT
THIS AGREEMENT, made as of July 17, 1995, by and between
XXXXXXXXX CASH RESERVES TRUST (the "Trust"), a Massachusetts
business trust, 000 Xxxxxxx Xxxxxx, Xxxxx 0000, Xxx Xxxx, Xxx
Xxxx 00000, and BANC ONE INVESTMENT ADVISORS CORPORATION (the
"Adviser")
W I T N E S S E T H :
WHEREAS, the Trust and the Adviser wish to enter into an
investment advisory agreement as herein set forth, referred to
hereafter as "this Agreement";
NOW THEREFORE, in consideration of the mutual promises and
agreements herein contained and other good and valuable
consideration, the receipt of which is hereby acknowledged, the
parties hereto agree as follows:
1. In General
The Adviser agrees, all as more fully set forth herein, to
act as managerial investment adviser to the Trust with respect to
the investment of the Trust's assets, and to supervise and
arrange the purchase of securities for and the sale of securities
held in the portfolio of the Trust.
2. Duties and Obligations of the Adviser With Respect To
Investment of the Assets of the Trust
(a) Subject to the succeeding provisions of this
section and subject to the direction and control of the Board of
Trustees of the Trust, the Adviser shall:
(i) Supervise continuously the investment program of
the Trust and the composition of its portfolio;
(ii) Determine what securities shall be purchased or
sold by the Trust;
(iii) Arrange for the purchase and the sale of
securities held in the portfolio of the Trust; and
(iv) Furnish information as to such securities to any
provider of fund accounting services to the Trust;
(v) monitor records of the Trust as to the portfolio,
including prices, maintained by such provider of such
services; and supply, monthly or more frequently as may
be necessary, pricing of the Trust's portfolio based on
available market quotations using a pricing service or
other source of pricing information satisfactory to the
Trust.
(b) Any investment program furnished by the Adviser
under this section shall at all times conform to, and be in
accordance with, any requirements imposed by: (1) the Investment
Company Act of l940 (the "Act") and any rules or regulations in
force thereunder; (2) any other applicable laws, rules and
regulations; (3) the Declaration of Trust and By-Laws of the
Trust as amended from time to time; (4) any policies and
determinations of the Board of Trustees of the Trust; and (5) the
fundamental policies of the Trust, as reflected in its
registration statement under the Act or as amended by the
shareholders of the Trust.
(c) The Adviser shall give the Trust the benefit of its
best judgment and effort in rendering services hereunder, but the
Adviser shall not be liable for any loss sustained by reason of
the adoption of any investment policy or the purchase, sale or
retention of any security, whether or not such purchase, sale or
retention shall have been based upon (i) its own investigation
and research or (ii) investigation and research made by any other
individual, firm or corporation, if such purchase, sale or
retention shall have been made and such other individual, firm or
corporation shall have been selected in good faith by the
Adviser. Nothing herein contained shall, however, be construed
to protect the Adviser against any liability to the Trust or its
security holders by reason of willful misfeasance, bad faith or
gross negligence in the performance of its duties, or by reason
of its reckless disregard of its obligations and duties under
this Agreement.
(d) Nothing in this Agreement shall prevent the Adviser
or any affiliated person (as defined in the Act) of the Adviser
from acting as investment adviser or manager for any other
person, firm or corporation and shall not in any way limit or
restrict the Adviser or any such affiliated person from buying,
selling or trading any securities for its own or their own
accounts or for the accounts of others for whom it or they may be
acting, provided, however, that the Adviser expressly represents
that it will undertake no activities which, in its judgment, will
adversely affect the performance of its obligations to the Trust
under this Agreement. It is agreed that the Adviser shall have
no responsibility or liability for the accuracy or completeness
of the Trust's Registration Statement under the Act and the
Securities Act of 1933, except for information supplied by the
Adviser for inclusion therein. The Adviser shall promptly inform
the Trust as to any information concerning the Adviser
appropriate for inclusion in such Registration Statement, or as
to any transaction or proposed transaction which might result in
an assignment of the Agreement. The Trust agrees to indemnify
the Adviser to the full extent permitted by the Trust's
Declaration of Trust.
(e) In connection with its duties to arrange for the
purchase and sale of the Trust's portfolio securities, the
Adviser shall select such broker-dealers ("dealers") as shall, in
the Adviser's judgment, implement the policy of the Trust to
achieve "best execution," i.e., prompt, efficient, and reliable
execution of orders at the most favorable net price. The
Adviser, acting as agent for the Trust, shall cause the Trust to
deal directly with the selling or purchasing principal or market
maker without incurring brokerage commissions unless the Adviser
determines that better price or execution may be obtained by
paying such commissions; the Trust expects that most transactions
will be principal transactions at net prices and that the Trust
will incur little or no brokerage costs. The Trust understands
that purchases from underwriters include a commission or
concession paid by the issuer to the underwriter and that
principal transactions placed through dealers include a spread
between the bid and asked prices. In allocating transactions to
dealers, the Adviser is authorized to consider, in determining
whether a particular dealer will provide best execution, the
dealer's reliability, integrity, financial condition and risk in
positioning the securities involved, as well as the difficulty of
the transaction in question, and thus need not pay the lowest
spread or commission available if the Adviser determines in good
faith that the amount of commission is reasonable in relation to
the value of the brokerage and research services provided by the
dealer, viewed either in terms of the particular transaction or
the Adviser's overall responsibilities as to the accounts as to
which it exercises investment discretion. If, on the foregoing
basis, the transaction in question could be allocated to two or
more dealers, the Adviser is authorized, in making such
allocation, to consider (i) whether a dealer has provided
research services, as further discussed below; and (ii) whether a
dealer has sold shares of the Trust or any other investment
company or companies having the Adviser as its investment adviser
or having the same sub-adviser, administrator or principal
underwriter as the Trust. Such research may be in written form
or through direct contact with individuals and may include
quotations on portfolio securities and information on particular
issuers and industries, as well as on market, economic, or
institutional activities. The Trust recognizes that no dollar
value can be placed on such research services or on execution
services, that such research services may or may not be useful to
the Trust and/or other accounts of the Adviser, and that research
received by such other accounts may or may not be useful to the
Trust.
3. Allocation of Expenses
The Adviser agrees that it will furnish the Trust, at the
Adviser's expense, all office space, facilities, equipment and
clerical personnel necessary for carrying out its duties under
this Agreement. The Adviser agrees that it will supply, or cause
to be supplied, to any sub-adviser, administrator or principal
underwriter of the Trust all necessary financial information in
connection with such sub-adviser's, administrator's or principal
underwriter's duties under any agreement between such sub-
adviser, administrator or principal underwriter and the Trust.
The Adviser will also pay all compensation of the Trust's
officers, employees, and Trustees, if any, who are affiliated
persons of the Adviser. The Trust agrees to bear the costs of
preparing and setting in type its prospectuses, statements of
additional information and reports to its shareholders, and the
costs of printing or otherwise producing and distributing those
copies of such prospectuses, statements of additional information
and reports as are sent to its shareholders. All costs and
expenses not expressly assumed by the Adviser under this
Agreement or by such sub-adviser, administrator or principal
underwriter shall be paid by the Trust, including, but not
limited to (i) interest and taxes; (ii) brokerage commissions;
(iii) insurance premiums; (iv) compensation and expenses of its
Trustees other than those affiliated with the Adviser or such
sub-adviser, administrator or principal underwriter; (v) legal
and audit expenses; (vi) custodian and transfer agent, or
shareholder servicing agent, fees and expenses; (vii) expenses
incident to the issuance of its shares (including issuance on the
payment of, or reinvestment of, dividends); (viii) fees and
expenses incident to the registration under Federal or State
securities laws of the Trust or its shares; (ix) expenses of
preparing, printing and mailing reports and notices and proxy
material to shareholders of the Trust; (x) all other expenses
incidental to holding meetings of the Trust's shareholders; and
(xi) such non-recurring expenses as may arise, including
litigation affecting the Trust and the legal obligations for
which the Trust may have to indemnify its officers and Trustees.
4. Compensation of the Adviser
(a) The Trust agrees to pay the Adviser, and the
Adviser agrees to accept as full compensation for all services
rendered by the Adviser as such, a management fee payable monthly
and computed on the net asset value of the Trust as of the close
of business each business day at the annual rate of 0.25 of 1% of
such net asset value through and including the day on which this
Agreement is approved by the shareholders of the Trust, and at
the annual rate of 0.33 of 1% of such net assets thereafter.
(b) The Adviser agrees that the fee under (a) above
shall be reduced, but not below zero, by an amount equal to its
pro-rata portion (hereafter described) of the amount, if any, by
which the total expenses of the Trust in any fiscal year,
exclusive of taxes, interest and brokerage fees, shall exceed the
lesser of (i) 2.5% of the first $30 million of average annual net
assets of the Trust plus 2% of the next $70 million of such net
assets of the Trust plus 1.5% of its average annual net assets in
excess of $100 million, or (ii) 25% of the Trust's total annual
investment income. The payment of the fee under (a) above at the
end of any month will be reduced or postponed so that at no time
will there be any accrued but unpaid liability under this expense
limitation, subject to readjustment during the year. The pro
rata portion, as between the Administrator and Adviser, is based
on the aggregate of the fee of the Adviser and the fee of the
Administrator (exclusive of amounts paid or to be paid out for
the applicable period pursuant to the Trust's Distribution Plan).
5. Duration and Termination
(a) This Agreement shall become effective upon close of
business on July 17, 1995 and, if approved by the shareholders of
the Trust within 120 days of that date shall, unless terminated
as hereinafter provided, continue in effect until the December 31
next preceding the second anniversary of the effective date of
this Agreement, and from year to year thereafter, but only so
long as such continuance is specifically approved at least
annually (1) by a vote of the Trust's Board of Trustees,
including a vote of a majority of the Trustees who are not
parties to this Agreement or "interested persons" (as defined in
the Act) of any such party, with votes cast in person at a
meeting called for the purpose of voting on such approval, or (2)
by a vote of the holders of a "majority" (as so defined) of the
outstanding voting securities of the Trust and by such a vote of
the Trustees.
(b) This Agreement may be terminated by the Adviser at
any time without penalty upon giving the Trust sixty days'
written notice (which notice may be waived by the Trust) and may
be terminated by the Trust at any time without penalty upon
giving the Adviser sixty days' written notice (which notice may
be waived by the Adviser), provided that such termination by the
Trust shall be directed or approved by a vote of a majority of
its Trustees in office at the time or by a vote of the holders of
a majority (as defined in the Act) of the voting securities of
the Trust outstanding and entitled to vote. This Agreement shall
automatically terminate in the event of its assignment (as
defined in the Act).
6. Disclaimer of Shareholder Liability
The Adviser understands that the obligations of this
Agreement are not binding upon any shareholder of the Trust
personally, but bind only the Trust's property; the Adviser
represents that it has notice of the provisions of the Trust's
Declaration of Trust disclaiming shareholder liability for acts
or obligations of the Trust.
7. Notices of Meetings
The Trust agrees that notice of each meeting of the
Board of Trustees of the Trust will be sent to the Adviser and
that the Trust will make appropriate arrangements for the
attendance (as persons present by invitation) of such person or
persons as the Adviser may designate.
IN WITNESS WHEREOF, the parties hereto have caused the
foregoing instrument to be executed by their duly authorized
officers and their seals to be hereunto affixed, all as of the
day and year first above written.
ATTEST: Xxxxxxxxx Cash Reserves Trust
________________________ By:___________________________________
Xxxx X. Xxxxxxxx
Assistant Secretary President and Chairman
ATTEST: Banc One Investment Advisors Corporation
________________________ By:___________________________________
