FORM OF
INVESTMENT ADVISORY AGREEMENT
November [ ], 1995
Travelers Investment Management Company
Xxx Xxxxx Xxxxxx
Xxxxxxxx, XX 00000-000
Dear Sirs:
This Investment Advisory Agreement (the "Agreement") is
made on this [ ] day of November, 1995, by and between
Xxxxx Xxxxxx Investment Trust, a business trust organized
under the laws of the Commonwealth of Massachusetts (the
"Trust"), in respect of its sub-trust, Xxxxx Xxxxxx S&P 500
Advantage Fund (the "Fund"), and Travelers Investment
Management Company ("TIMCO") as follows:
1. Investment Description; Appointment
The Fund desires to employ its capital by investing and
reinvesting in investments of the kind and in
accordance with the limitations specified in: (i) the
Trust's Master Trust Agreement, as amended from time to
time (the "Master Trust Agreement"); (ii) the Fund's
Prospectuses (the "Prospectus"); and (iii) the Fund's
Statement of Additional Information (the "Statement")
filed with the Securities and Exchange Commission (the
"SEC") as part of the Fund's Registration Statement on
Form N-lA, as amended from time to time, and in such
manner and to such extent as may from time to time be
approved by the Board of Trustees of the Trust (the
"Board"). Copies of the Fund's Prospectus and the
Statement and the Trust's Master Trust Agreement have
been or will be submitted to TIMCO. The Trust desires
to employ and hereby appoints TIMCO to act as
investment adviser for the Fund. TIMCO accepts the
appointment and agrees to furnish the services for the
compensation set forth below. TIMCO is hereby
authorized to retain third parties and is hereby
authorized to delegate some or all of its duties and
obligations hereunder to such persons, provided such
persons shall remain under the general supervision of
TIMCO.
2. Services as Investment Adviser
Subject to the supervision and direction of the Board,
TIMCO will: (a) manage the Fund's portfolio in
accordance with the Fund's investment objective and
policies as stated in the Prospectus and the Statement;
(b) make investment decisions for the Fund; (c) place
purchase and sale orders for portfolio transactions for
the Fund; and (d) employ professional portfolio
managers and securities analysts to provide research
services to the Fund. In providing those services,
SBMFM will conduct a continual program of investment,
evaluation and, if appropriate, sale and reinvestment
of the Fund's assets.
3. Compensation
In consideration of the services rendered pursuant to
this Agreement, the Trust will pay TIMCO, on the first
business day of each month, a fee for the previous
month at an annual rate of 0.50% of the Fund's average
daily net assets. The fee for the period from the date
the Fund commences its investment operations to the end
of the month during which the Fund commences its
investment operations shall be pro-rated according to
the proportion that such period bears to the full
monthly period. Upon any termination of this Agreement
before the end of any month, the fee for such part of
that month shall be pro-rated according to the
proportion that such period bears to the full monthly
period and shall be payable upon the date of
termination of this Agreement. For the purpose of
determining fees payable to TIMCO, the value of the
Fund's net assets shall be computed at the times and in
the manner specified in the Fund's Prospectus and/or
the Statement, as from time to time in effect.
5. Expenses
TIMCO will bear all expenses in connection with the
performance of its services under this Agreement. The
Fund will bear certain other expenses to be incurred in
its operation, including: investment advisory and
administration fees; charges of custodians and transfer
and dividend disbursing agents; fees for necessary
professional services, such as the Fund's and Board
members' proportionate share of insurance premiums,
professional associations, dues and/or assessments; and
brokerage services, including taxes, interest and
commissions; costs of preparing and printing
prospectuses and statements of additional information
for regulatory purposes and for distribution to
existing shareholders; the costs of regulatory
compliance, such as SEC fees and state blue sky
qualifications fees; outside auditing and legal
expenses and costs associated with maintaining the
Fund's legal existence; costs of shareholders' reports
and meetings of the officers or Board; fees of the
members of the Board who are not officers, directors or
employees of Xxxxx Xxxxxx, Inc. or its affiliates or
any person who is an affiliate of any person to whom
duties may be delegated hereunder.
6. Reimbursement to the Fund
If in any fiscal year the aggregate expenses of the
Fund (including fees pursuant to this Agreement, but
excluding distribution fees, interest, taxes, brokerage
and, if permitted by state securities commissions,
extraordinary expenses) exceed the expense limitations
of any state having jurisdiction over the Fund, TIMCO
will reimburse the Fund for that excess expense to the
extent required by state law in the same proportion as
its respective fees bear to the combined fees for
investment advice and administration. The expense
reimbursement obligation of TIMCO will be limited to
the amount of its fees hereunder. Such expense
reimbursement, if any, will be estimated, reconciled
and paid on a monthly basis.
7. Brokerage
In selecting brokers or dealers to execute transactions
on behalf of the Fund, TIMCO will seek the best overall
terms available. In assessing the best overall terms
available for any transaction, TIMCO will consider
factors it deems relevant, including, but not limited
to, the breadth of the market in the security, the
price of the security, the financial condition and
execution capability of the broker or dealer and the
reasonableness of the commission, if any, for the
specific transaction and on a continuing basis. In
selecting brokers or dealers to execute a particular
transaction, and in evaluating the best overall terms
available, TIMCO is authorized to consider the
brokerage and research services (as those terms are
defined in Section 28(e) of the Securities Exchange Act
of 1934, as amended) provided to the Fund and/or other
accounts over which TIMCO or its affiliates exercise
investment discretion.
8. Information Provided to the Fund
TIMCO will keep the Trust informed of developments
materially affecting the Fund's portfolio, and will, on
its own initiative, furnish the Trust from time to
time with whatever information TIMCO believes is
appropriate for this purpose.
9. Standard of Care
TIMCO shall exercise its best judgment in rendering the
services listed in paragraph 2 above. TIMCO shall not
be liable for any error of judgment or mistake of law
or for any loss suffered by the Fund in connection with
the matters to which this Agreement relates, provided
that nothing in this Agreement shall be deemed to
protect or purport to protect TIMCO against any
liability to the Trust or to the Fund's shareholders to
which TIMCO would otherwise be subject by reason of
willful malfeasance, bad faith or gross negligence on
its part in the performance of its duties or by reason
of TIMCO 's reckless disregard of its obligations and
duties under this Agreement.
10. Services to Other Companies or Accounts
The Trust understands that TIMCO now acts, will
continue to act and may act in the future as:
investment adviser to fiduciary and other managed
accounts, as well as to other investment companies; and
the Trust has no objection to TIMCO's so acting,
provided that whenever the Fund and one or more other
investment companies advised by TIMCO have available
funds for investment, investments suitable and
appropriate for each will be allocated in accordance
with a formula believed to be equitable to each
company. The Trust recognizes that in some cases this
procedure may adversely affect the size of the position
obtainable for the Fund. In addition, the Trust
understands that the persons employed by TIMCO to
assist in the performance of TIMCO's duties under this
Agreement will not devote their full time to such
service and nothing contained in this Agreement shall
be deemed to limit or restrict the right of TIMCO or
any affiliate of TIMCO to engage in and devote time and
attention to other businesses or to render services of
whatever kind or nature.
l1. Term of Agreement
This Agreement shall become effective as of the date
the Fund commences its investment operations and
continue for an initial two-year term and shall
continue thereafter so long as such continuance is
specifically approved at least annually by (i) the
Board or (ii) a vote of a "majority" (as defined in the
Investment Company Act of 1940, as amended (the "1940
Act")) of the Fund's outstanding voting securities,
provided that in either event the continuance is also
approved by a majority of the Board who are not
"interested persons" (as defined in the 0000 Xxx) of
any party to this Agreement, by vote cast in person or
by proxy at a meeting called for the purpose of voting
on such approval. This Agreement is terminable,
without penalty, on 60 days' written notice, by the
Board or by vote of holders of a majority of the Fund's
shares, or upon 90 days' written notice, by TIMCO. This
Agreement will also terminate automatically in the
event of its assignment (as defined in the 1940 Act).
12. Representation by the Trust
The Trust represents that a copy of the Master Trust
Agreement is on file with the Secretary of the
Commonwealth of Massachusetts and with the City of
Boston.
13. Indemnification
The Trust agrees to indemnify TIMCO and its officers,
directors, employees, affiliates, controlling persons,
agents (including persons to whom responsibilities are
delegated hereunder) against any loss, claim, expense
or cost of any kind (including reasonable attorney's
fees) resulting or arising in connection with this
Agreement, or from the performance or failure to
perform any act hereunder, provided that no such
indemnification shall be available if the indemnitee
violated the standard of care in paragraph 8 above.
This indemnification shall be limited by the 1940 Act
and relevant state law. Each indemnitee shall be
entitled to advance of its expenses in accordance with
the requirements of the 1940 Act and the rules,
regulations and interpretations thereof as in effect
from time to time.
14. Limitation of Liability
The Trust and TIMCO agree that the obligations of the
Trust under this Agreement shall not be binding upon
any of the Board members, shareholders, nominees,
officers, employees or agents, whether past, present or
future, of the Trust individually, but are binding only
upon the assets and property of the Fund, as provided
in the Master Trust Agreement. The execution and
delivery of this Agreement have been duly authorized by
the Trust and TIMCO, and signed by an authorized
officer of each, acting as such. Neither the
authorization by the Board members of the Trust, nor
the Trust execution and delivery by the officer of the
Trust shall be deemed to have been made by any of them
individually or to impose any liability on any of them
personally, but shall bind only the assets and property
of the Fund as provided in the Master Trust Agreement.
If the foregoing is in accordance with your
understanding, kindly indicate your acceptance hereof by
signing and returning the enclosed copy of this Agreement to
us.
Very truly yours,
Xxxxx Xxxxxx Investment
Trust,
on behalf of
Xxxxx Xxxxxx S&P 500
Advantage Fund.
By:
Title:
Accepted:
Travelers Investment Management Company
By:
Title:
