STATE OF ALABAMA) Exhibit 10.5
JEFFERSON COUNTY)
THIS AGREEMENT made and entered into this day, June 1, 1995, by and
between the CITY OF BIRMINGHAM presently operating under the Mayor Council
Act of 1955 (hereinafter referred to as the "City") and XXXXXXX CAPITAL
MANAGEMENT, INCORPORATED a registered investment advisor (hereinafter
referred to as "Advisor").
The parties hereto agree as follows:
ARTICLE I
THE BIRMINGHAM FUND
The City has available cash together with other assets which are hereby
designated by the City and accepted by Advisor and any assets collected,
purchased, received or acquired by the City following the advice of Advisor,
shall be referred to herein as the "Birmingham Fund." The Finance Director of
the City shall have authority to designate the cash and assets which shall be
subject to this Agreement.
ARTICLE II
BIRMINGHAM FUND SUPERVISION
The Advisor agrees to manage the assets of the fund in accordance with
City Ordinance Number 94-90.
Advisor will discuss with the City any questions that may be raised by the
City from time to time with regard to the Birmingham Fund. Advisor shall have
authority to make investments in accord with the City's Internal Investment
Policy. All investments made by Advisor will be
reported to the Finance Director of the City by statements and confirmations
and at a quarterly meeting with the May and Finance Director.
Any uninvested funds will be swept into a US Government money market fund
to earn maximum income on such temporarily uninvested funds. The Advisor will
not charge an additional fee for this service provided that the City
recognizes that a fee may be charged by the custodian or Advisor managing the
US Government money market fund.
Advisor will comply with all reasonable reporting and information requests
of the Finance Director. Advisor shall comply with the City's Internal
Investment Policy, as it may be amended, established by the City.
ARTICLE III
PURCHASE AND SALE OF SECURITIES AND OTHER PROPERTY
Advisor shall have discretion to place for the City's account orders for
the purchase and sale of securities.
ARTICLE IV
REGISTRATION OF SECURITIES
All securities in the Birmingham Fund which are registrable shall be
registered by the custodian in the name of the City unless authorized in
writing otherwise by the Finance Director.
ARTICLE V
CUSTODY OF SECURITIES
The City desires that the monies and securities comprising the Birmingham
Fund be held in a bonded banking institution whose main office is located
within the corporate limits of the City of Birmingham, Alabama. The City
shall pay the fee for such custody. All assets of the
City in the custody of Advisor or which may come into the custody of Advisor
shall immediately be transferred into the custody of the custodian.
ARTICLE VI
LITERATURE AND MAIL RECEIVED BY BANK
Advisor will endeavor to forward to the City's Finance Director any
proxies, financial statements, or other literature received by it in
connection with or relating to securities held by it, but Advisor shall be
under no obligation other than good faith efforts, to forward such proxies,
financial statements, or other literature. Since Advisor may receive
correspondence directed to the City in care of Advisor, Advisor is authorized
to accept and open all mail so addressed.
The Advisor is relieved from the responsibility of voting any securities
or other property held in the Birmingham Fund. Advisor may recommend voting
to the City.
ARTICLE VII
WITHDRAWAL OF ASSETS FROM THE BIRMINGHAM FUND
Any and all assets in the Birmingham Fund may be withdrawn by the City at
any time upon receipt by Advisor of a certified copy of resolution duly
signed by the City's Mayor or on the written order of the City's Finance
Director.
ARTICLE VIII
AMENDMENT OR TERMINATION OF AGREEMENT
This agreement may be altered at any time by letter or other written
instrument in such manner as may be mutually agreed upon by Advisor and the
City and may be terminated at any time either by Advisor or by the City
whereupon all assets of every kind and nature in the Birmingham Fund as it
then exists, shall be paid over, delivered or surrendered, in whatever form
the same may be, to the City.
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GENERAL TERMS AND CONDITIONS
1. It is understood that the City is the owner of all assets from time
to time comprising the Birmingham Fund. Advisor shall be responsible for the
safekeeping of any assets in its custody but shall not be required to exercise
greater care in this regard than it reasonably does in the safekeeping of its
own property. The Advisor shall not be liable or responsible for any act or
failure to act of any broker or similar agent employed by Advisor to effect a
transaction on City's behalf, or for the financial solvency of any such broker
or agent, as long as Advisor either exercises the same care in selecting such
broker or agent as Advisor employees in handling similar transactions involving
its own property, unless Advisor utilizes the broker or agents selected by the
City.
2. City agrees that Advisor shall not through this contract be liable
for any loss, damage, or expense resulting from the execution by Advisor of
any order for the City hereunder or for any taxes or other governmental
charger, or any expense related thereto, which may be imposed or assessed in
respect to the Birmingham Fund, or any part thereof. The City does not hereby
assume any expense in addition to charges noted herein or other reasonable
expense except as may be expressly approved in writing by the City or the
Finance Director.
3. Fee. Advisor shall be entitled to a reasonable fee for acting as
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investment advisor. Such fee shall be paid quarterly and shall be at the
annual rate of thirty five-hundredths of one percent (.35%) of the market
value of the Birmingham Fund at the end of the preceding quarter up to, but
not exceeding, a market value of fifty million dollars ($50,000,000). The fee
for all assets exceeding fifty million dollars ($50,000,000) shall be twenty
five-hundredths of one percent (.25%) of the market value of the Birmingham
Fund at the end of the preceding quarter.
The fee for all assets exceeding one hundred million dollars ($100,000,000)
shall be twenty one-hundredths of one percent (.20%) of the market value of
the Birmingham Fund at the end of the preceding quarter. This fee shall be
automatically amended to equal any increased fee schedule approved by the
Mayor.
4. Advisor will comply with all applicable federal, state and local
laws and ordinances and will take no action under this contract which would
cause a violation of any such law or ordinance.
5. So long as the provisions of Section 28(c) of the Securities
Exchange Act of 1934 are met, Advisor may cause a broker or dealer to be paid
reasonable commissions in excess of those another broker or dealer would or
might charge. No more than fifty percent of these transactions may be
effected through or with the Xxxxxxx Company as broker, dealer or principal,
and the City may impose additional limitation in writing. In connection with
such transactions, The Xxxxxxx Company will receive compensation related to
the brokerage function independent of the compensation paid to Advisor
hereunder.
6. Bond. City notifies Advisor that Advisor is not covered under any
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bond obtained by the City pursuant to Section 412 of ERISA or otherwise. Upon
termination, Advisor shall be entitled to a prorate fee for the quarter in
which termination occurs.
7. Asset Transfer. The Finance Director of the City shall have
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authority to make all determinations relating to asset transfer as in his
judgment are in the best interests of the City.
8. Notices. any notices hereunder may be given to the City at:
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Director of Finance
000 Xxxx Xxxx
Xxxxxxxxxx, Xxxxxxx 00000
and to Advisor at:
Xxxxxxx Capital Management
World Trade Center Baltimore
000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed in their respective names by their respective officers who are
hereunto duly authorized, in duplicate, all on the day and year first above
written.
CITY OF BIRMINGHAM ATTEST:
By: /s/ Xxxxxxx Xxxxxxxxx, Xx., By: /s/ Xxx Xxxxxxxxx
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Xxxxxxx Xxxxxxxxx, Xx., Mayor
XXXXXXX CAPITAL MANAGEMENT ATTEST":
By: /s/ Xxxxxx Xxxxxxx By: /s/ Xxxx X. Xxxxx, Xx.
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Xxxxxx Xxxxxxx, President
