EXHIBIT 5
XXXXXXX XXXXX VARIABLE INSURANCE TRUST
0000 Xxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Xxxxxxx Sachs Asset Management Xxxxxxx Xxxxx Asset Management
Xxx Xxx Xxxx Xxxxx, Xxxxxxxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000 000 Xxxxxxxxxxxx XX
Xxxxxx, Xxxxxxx
MANAGEMENT AGREEMENT
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Dear Sirs:
Xxxxxxx Sachs Variable Insurance Trust (the "Registrant") is organized as a
business trust under the laws of the State of Delaware to engage in the business
of an investment company. The shares of the Registrant ("Shares") may be
divided into multiple series ("Series"), including the Series listed on Annex A
(including any Series added to Annex A in the future, each a "Fund"). Each
Series will represent the interests in a separate portfolio of securities and
other assets. Each Series may be terminated, and additional Series established,
from time to time by action of the Trustees. The Registrant on behalf of each
Fund has selected you to act as an investment adviser and administrator of each
Fund as designated on Annex A and to provide certain services as more fully set
forth below, and you are willing to act as such investment adviser and
administrator and to perform such services under the terms and conditions
hereinafter set forth. Accordingly, the Registrant agrees with you as follows:
1. Name of Registrant. The Registrant may use any name including or derived
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from the name "Xxxxxxx Xxxxx" in connection with a Fund 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 your business as investment adviser or administrator. Upon the termination of
this Agreement, the Registrant (to the extent that it lawfully can) will cause
the Funds to cease to use such a name or any other name indicating that it is
advised by or otherwise connected with you or any organization which shall have
so succeeded to your business.
2. Affiliated Advisers and Sub-Advisers. At your discretion, you may provide
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advisory and administration services through your
own employees or the employees of one or more affiliated companies that are
qualified to act as investment adviser, or administrator to the Registrant under
applicable law and are under the common control of Xxxxxxx Sachs & Co. provided
that (i) all persons, when providing services hereunder, are functioning as part
of an organized group of persons; and (ii) that such organized group of persons
is managed at all times by your authorized officers. You may also engage one or
more investment advisers which are either registered as such or specifically
exempt from registration under the Investment Advisers Act of 1940, as amended,
to act as sub-advisers to provide with respect to any Fund certain services set
forth in Paragraphs 3 and 6 hereof, all as shall be set forth in a written
contract to which the Registrant, on behalf of the particular Fund, and you
shall be parties, which contract shall be subject to approval by the vote of a
majority of the Trustees who are not interested persons of you, the sub-adviser,
or of the Registrant, cast in person at a meeting called for the purpose of
voting on such approval and by the vote of a majority of the outstanding voting
securities of the Fund and otherwise consistent with the terms of the Investment
Company Act of 1940, as amended (the "1940 Act").
3. Management Services.
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(a) You will regularly provide each Fund with investment research,
advice and supervision and will furnish continuously an investment program
for each Fund consistent with the investment objectives and policies of the
Fund. You will determine from time to time what securities shall be
purchased for a Fund, what securities shall be held or sold by a Fund, and
what portion of a Fund's assets shall be held uninvested as cash, subject
always to the provisions of the Registrant's Declaration of Trust and By-
Laws and of the 1940 Act, and to the investment objectives, policies and
restrictions of the Fund, as each of the same shall be from time to time in
effect, and subject, further, to such policies and instructions as the
Trustees of the Registrant may from time to time establish.
(b) Subject to the general supervision of the Trustees of the
Registrant, you will provide certain administrative services to each Fund.
You will, to the extent such services are not required to be performed by
others pursuant to the custodian agreement (or the transfer agency
agreement to the extent that a person other than you is serving thereunder
as the Registrant's transfer agent), (i) provide supervision of all aspects
of each Fund's operations not referred to in paragraph (a) above; (ii)
provide each Fund with personnel to perform such executive, administrative
and clerical services as are reasonably necessary to provide effective
administration of the Fund; (iii) arrange for, at the Registrant's expense,
(a) the preparation for each Fund of
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all required tax returns, (b) the preparation and submission of reports to
existing shareholders and (c) the periodic updating of the Fund's
prospectuses and statements of additional information and the preparation
of reports filed with the Securities and Exchange Commission and other
regulatory authorities; (iv) maintain all of the Funds' records; and (v)
provide the Funds with adequate office space and all necessary office
equipment and services including telephone service, heat, utilities,
stationery supplies and similar items.
(c) You will also provide to the Registrant's Trustees such periodic
and special reports as the Trustees may reasonably request. You shall for
all purposes herein be deemed to be an independent contractor and shall,
except as otherwise expressly provided or authorized, have no authority to
act for or represent the Registrant or the Funds in any way or otherwise be
deemed an agent of the Registrant or the Funds.
(d) You will maintain all books and records with respect to the Funds'
securities transactions required by sub-paragraphs (b)(5), (6), (7), (9)
and (10) and paragraph (f) of Rule 31a-1 under the 1940 Act (other than
those records being maintained by the Fund's custodian or transfer agent)
and preserve such records for the periods prescribed therefor by Rule 31a-2
of the 1940 Act. You will also provide to the Registrant's Trustees such
periodic and special reports as the Board may reasonably request.
(e) You will notify the Registrant of any change in your membership
within a reasonable time after such change.
(f) Your services hereunder are not deemed exclusive and you shall be
free to render similar services to others.
4. Allocation of Charges and Expenses. You will pay all costs incurred by you
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in connection with the performance of your duties under paragraph 3. You will
pay the compensation and expenses of all personnel of yours and will make
available, without expense to the Funds, the services of such of your partners,
officers and employees as may duly be elected officers or Trustees of the
Registrant, subject to their individual consent to serve and to any limitations
imposed by law. You will not be required to pay any expenses of any Fund other
than those specifically allocated to you in this Paragraph 4. In particular,
but without limiting the generality of the foregoing, you will not be required
to pay: (i) organization expenses of the Funds; (ii) fees and expenses incurred
by the Funds in connection with membership in investment company organizations;
(iii) brokers' commissions; (iv) payment for portfolio pricing services to a
pricing agent, if any; (v) legal, auditing or accounting expenses (including an
allocable portion
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of the cost of your employees rendering legal and accounting services to the
Fund); (vi) taxes or governmental fees; (vii) the fees and expenses of the
transfer agent of the Registrant; (viii) the cost of preparing stock
certificates or any other expenses, including clerical expenses of issue,
redemption or repurchase of Shares of the Fund; (ix) the expenses of and fees
for registering or qualifying Shares for sale and of maintaining the
registration of the Funds and registering the Registrant as a broker or a
dealer; (x) the fees and expenses of Trustees of the Registrant who are not
affiliated with you; (xi) the cost of preparing and distributing reports and
notices to shareholders, the Securities and Exchange Commission and other
regulatory authorities; (xii) the fees or disbursements of custodians of each
Fund's assets, including expenses incurred in the performance of any obligations
enumerated by the Declaration of Trust or By-Laws of the Registrant insofar as
they govern agreements with any such custodian; or (xiii) litigation and
indemnification expenses and other extraordinary expenses not incurred in the
ordinary course of the Fund's business. You shall not be required to pay
expenses of activities which are primarily intended to result in sales of Shares
of the Funds.
5. Compensation of the Manager.
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(a) For all services to be rendered and payments made as provided in
Paragraphs 3 and 4 hereof, the Registrant on behalf of each Fund will pay
you each month a fee at an annual rate equal to the percentage of the
average daily net assets of the Fund set forth with respect to such Fund on
Annex A. The "average daily net assets" of a Fund shall be determined on
the basis set forth in the Fund's prospectus(es) or otherwise consistent
with the 1940 Act and the regulations promulgated thereunder.
(b) In addition to the foregoing, you may from time to time agree not
to impose all or a portion of your fee otherwise payable hereunder (in
advance of the time such fee or portion thereof would otherwise accrue)
and/or undertake to pay or reimburse a Fund for all or a portion of its
expenses not otherwise required to be borne or reimbursed by you. Any such
fee reduction or undertaking may be discontinued or modified by you at any
time.
6. Avoidance of Inconsistent Position. In connection with purchases or sales
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of portfolio securities for the account of the Funds, neither you nor any of
your partners, officers or employees will act as a principal, except as
otherwise permitted by the 1940 Act. You or your agent shall arrange for the
placing of all orders for the purchase and sale of portfolio securities for each
Fund's account with brokers or dealers (including Xxxxxxx, Xxxxx & Co.) selected
by you. In the selection of such brokers or dealers (including Xxxxxxx, Sachs &
Co.) and the placing of such orders, you are directed at all times to seek for
the Funds the most favorable execution and net price available. It is also
understood that it is desirable for the Funds that you
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have access to supplemental investment and market research and security and
economic analyses provided by brokers who may execute brokerage transactions at
a higher cost to a Fund than may result when allocating brokerage to other
brokers on the basis of seeking the most favorable price and efficient
execution. Therefore, you are authorized to place orders for the purchase and
sale of securities for the Funds with such brokers, subject to review by the
Registrant's Trustees from time to time with respect to the extent and
continuation of this practice. It is understood that the services provided by
such brokers may be useful to you in connection with your services to other
clients. If any occasion should arise in which you give any advice to your
clients concerning the Shares of the Funds, you will act solely as investment
counsel for such clients and not in any way on behalf of any Fund. You may, on
occasions when you deem the purchase or sale of a security to be in the best
interests of a Fund as well as your other customers (including any other Series
or any other investment company or advisory account for which you or any of your
affiliates acts as an investment adviser), aggregate, to the extent permitted by
applicable laws and regulations, the securities to be sold or purchased in order
to obtain the best net price and the most favorable execution. In such event,
allocation of the securities so purchased or sold, as well as the expenses
incurred in the transaction, will be made by you in the manner you consider to
be the most equitable and consistent with your fiduciary obligations to the Fund
and to such other customers. In addition, you are authorized to take into
account the sale of Shares of the Registrant in allocating purchase and sale
orders for portfolio securities to brokers or dealers (including brokers and
dealers that are affiliated with you), provided that you believe that the
quality of the transaction and the commission is comparable to what they would
be with other qualified firms.
7. Limitation of Liability of Manager and Fund. You shall not be liable for
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any error of judgment or mistake of law or for any loss suffered by a Fund in
connection with the matters to which this Agreement relates, except a loss
resulting from willful misfeasance, bad faith or gross negligence on your part
in the performance of your duties or from reckless disregard by you of your
obligations and duties under this Agreement. Any person, even though also
employed by you, who may be or become an employee of and paid by the Registrant
or the Funds shall be deemed, when acting within the scope of his employment by
the Funds, to be acting in such employment solely for the Funds and not as your
employee or agent. A Fund shall not be liable for any claims against any other
Fund or Series of the Registrant.
8. Duration and Termination of this Agreement. This Agreement shall remain in
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force as to each Fund until June 30, 1999 and shall continue for periods of
one year thereafter, but only so long as such continuance is specifically
approved at least annually (a) by the vote of a majority of the Trustees who are
not interested persons (as defined in the 0000 Xxx) of the Registrant and have
no financial interest in this Agreement, cast
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in person at a meeting called for the purpose of voting on such approval and
(b) by a vote of a majority of the Trustees of the Registrant or of a majority
of the outstanding voting securities of such Fund. The aforesaid requirement
that continuance of this Agreement be "specifically approved at least annually"
shall be construed in a manner consistent with the 1940 Act and the rules and
regulations thereunder. This Agreement may, on 60 days written notice to the
other party, be terminated in its entirety or as to a particular Fund at any
time without the payment of any penalty, by the Trustees of the Registrant, by
vote of a majority of the outstanding voting securities of a Fund, or by you.
This Agreement shall automatically terminate in the event of its assignment. In
interpreting the provisions of this Agreement, the definitions contained in
Section 2(a) of the 1940 Act (particularly the definitions of "interested
person," "assignment" and "majority of the outstanding voting securities"), as
from time to time amended, shall be applied, subject, however, to such
exemptions as may be granted by the Securities and Exchange Commission by any
rule, regulation or order.
9. Amendment of this Agreement. No provisions of this Agreement may be
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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. No amendment of this Agreement shall be
effective as to a Fund until approved by vote of the holders of a majority of
the outstanding voting securities of such Fund and by a majority of the Trustees
of the Registrant, including a majority of the Trustees who are not interested
persons (as defined in the 0000 Xxx) of the Registrant and have no financial
interest in this Agreement, cast in person at a meeting called for the purpose
of voting on such amendment. Notwithstanding the foregoing, this Agreement may
be amended at any time to add to a new Fund to Annex A, or for any other reason
permitted by the 1940 Act and the regulations and interpretations thereunder,
provided such amendment is approved by a majority of the Trustees of the
Registrant, including a majority of the Trustees who are not interested persons
(as defined in the 0000 Xxx) of the Registrant and have no financial interest in
this Agreement. This Paragraph does not apply to any agreement described in
Paragraph 5(b) hereof, which shall be effective during the period you specify in
a prospectus, sticker, or other document made available to current or
prospective shareholders.
10. Governing Law. This Agreement shall be governed by and construed in
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accordance with the laws of the State of New York.
11. Miscellaneous. The captions in this Agreement are included for convenience
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of reference only and in no way define or delimit any of the provisions hereof
or otherwise affect their construction or effect. This Agreement may be
executed simultaneously in two or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument.
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The name Xxxxxxx Xxxxx Variable Insurance Trust is the designation of the
Trustees for the time being under an Agreement and Declaration of Trust dated
September 16, 1997 as amended from time to time, and all persons dealing with
the Trust or a Fund must look solely to the property of the Trust or such Fund
for the enforcement of any claims as none of Trustees, officers, agents or
shareholders assume any personal liability for obligations entered into on
behalf of the Trust. No Fund shall be liable for any claims against any other
Series.
If you are in agreement with the foregoing, please sign the form of
acceptance on the Registrant counterpart of this letter and return such
counterpart to the Registrant, whereupon this letter shall become a binding
contract.
Yours very truly,
XXXXXXX SACHS VARIABLE INSURANCE TRUST
Attest: /s/ Xxxxxxx X. Xxxxxxx By: /s/ Xxxxxxx X. Grip
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Secretary of the Registrant President of the Registrant
The foregoing Agreement is hereby accepted as of the date thereof.
XXXXXXX XXXXX ASSET MANAGEMENT,
A DIVISION OF XXXXXXX, SACHS & CO.
Attest: /s/ Xxxxxxx X. Xxxxxxx By: /s/ Xxxxx X. Xxxx
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Counsel to the Funds Group Managing Director
XXXXXXX XXXXX ASSET MANAGEMENT INTERNATIONAL,
AN AFFILIATE OF XXXXXXX, SACHS & CO.
Attest: /s/ Xxxxxxx X. Xxxxxxx By: /s/ Xxxxx X. Xxxx
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Counsel to the Funds Group Managing Director
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Annex A
The division of investment adviser and administrator serevices and the
compensation for such services shall be as follows:
Xxxxxxx Xxxxx Asset Management Annual Rate
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Xxxxxxx Sachs High Yield Fund 0.70
Xxxxxxx Xxxxx Growth and Income Fund 0.75
Xxxxxxx Sachs CORE Large Cap Growth Fund 0.70
Xxxxxxx Xxxxx Mid Cap Equity Fund 0.80
Xxxxxxx Sachs CORE Small Cap Equity Fund 0.75
Xxxxxxx Xxxxx CORE U.S. Equity Fund 0.70
Xxxxxxx Sachs Capital Growth Fund 0.75
Xxxxxxx Xxxxx Asset Management International
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Xxxxxxx Sachs Global Income Fund 0.90
Xxxxxxx Xxxxx International Equity Fund 1.00
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