EXHIBIT 5.(i)
XXXXXXXXX XXXXXXXX INVESTMENT TRUST
INVESTMENT ADVISORY AGREEMENT
This INVESTMENT ADVISORY AGREEMENT ("Agreement") is made as of the 1st day
of October, 1997, by and between XXXXXXXXX XXXXXXXX INVESTMENT TRUST, a business
trust organized and existing under the laws of The Commonwealth of Massachusetts
(the "Trust"), with respect to its series of shares known as XXXXXXXXX XXXXXXXX
GLOBAL VALUE FUND (the "Fund"), and XXXXXXXXX, XXXXXXXX & COMPANY INVESTMENT
MANAGEMENT, L.P. (the "Adviser")
W I T N E S S E T H :
WHEREAS, the Trust is an open-end, management investment company,
registered as such under the Investment Company Act of 1940, as amended (the
"Act"); and
WHEREAS, the Trust desires to retain the Adviser to render advice and
services to the Trust and Fund pursuant to the terms and provisions of this
Agreement, and the Adviser is interested in furnishing said advice and services;
NOW, THEREFORE, in consideration of the covenants and the mutual
promises hereinafter set forth, the parties hereto mutually agree as follows:
1. EMPLOYMENT OF ADVISER. (a) The Trust hereby employs the Adviser,
and the Adviser hereby accepts such employment, to render investment advice and
investment management services with respect to the assets of the Fund,
consistent with the investment objective and policies of the Fund and subject to
the supervision and direction of the Trust's Board of Trustees. The Adviser
shall, except as otherwise provided for herein, as part of its duties hereunder,
(i) furnish the Trust with investment advice, research and recommendations with
respect to the investment of the Fund's assets and the purchase and sale of its
portfolio securities, including the taking of such other steps as may be
necessary to implement such advice and recommendations, (ii) furnish the Trust
and Fund with reports, statements and other data on securities, economic
conditions and other pertinent subjects in respect of the investment management
of the Fund which the Trust's Board of Trustees may request, and (iii) in
general superintend and manage the investments of the Fund, subject to the
ultimate supervision and direction of the Trust's Board of Trustees.
(b) The Adviser shall determine the securities to be purchased
or sold by the Fund and will place orders pursuant to its determinations with or
through such persons, brokers or dealers (including Xxxxxxxxx, Xxxxxxxx &
Company LLC) in conformity
with the policy with respect to brokerage as set forth in the Trust's
Registration Statement and the Fund's Prospectus and Statement of Additional
Information or as the Trustees may direct from time to time.
2. SUB-ADVISERS AND CONSULTANTS. The Adviser may from time to time,
in its discretion, delegate certain of its responsibilities under this Agreement
to one or more qualified companies, each of which is registered under the
Investment Advisers Act of 1940, as amended, provided that the separate costs of
employing such companies and of the companies themselves are borne by the
Adviser and not by the Fund.
3. ADVISER IS INDEPENDENT CONTRACTOR. The Adviser shall, for all
purposes herein, be deemed to be an independent contractor, and shall, unless
otherwise expressly provided and authorized, have no authority to act for or
represent the Trust or Fund in any way, or in any way be deemed an agent for the
Trust or Fund. It is expressly understood and agreed that the services to be
rendered by the Adviser to the Trust and Fund under the provisions of this
Agreement are not to be deemed exclusive, and the Adviser shall be free to
render similar or different services to others so long as its ability to render
the services provided for in this Agreement shall not be impaired thereby.
4. RESPONSIBILITIES AND PERSONNEL OF ADVISER. The Adviser agrees to
use its best efforts in the furnishing of investment advice, research and
recommendations to the Fund, in the preparation of reports and information, and
in the management of the Fund's assets, all pursuant to this Agreement, and for
this purpose the Adviser shall, at its own expense, maintain such staff and
employ or retain such personnel and consult with such other persons as it shall
from time to time determine to be necessary to the performance of its
obligations under this Agreement. Without limiting the generality of the
foregoing, the staff and personnel of the Adviser shall be deemed to include
persons employed or retained by the Adviser to furnish statistical, research,
and other factual information, advice regarding economic factors and trends,
information with respect to technical and scientific developments, and such
other information, advice and assistance as the Adviser may desire and request.
5. FURNISHING OF STATEMENTS AND REPORTS. The Trust shall from time
to time furnish to the Adviser detailed statements of the portfolio investments
and assets of the Fund and information as to its investment objectives and
needs, and shall make available to the Adviser such financial reports, business
descriptions and plans, proxy statements, legal and other information relating
to its investments as may be in the possession of the Trust or available to it
and such other information as the Adviser may reasonably request.
6. EXPENSES OF EACH PARTY. (a) The Adviser shall bear all expenses
in connection with the performance of its services under this Agreement. The
Adviser shall also pay (i) all compensation, if any, to the executive officers
of the Fund and their related expenses and (ii) all compensation, if any, and
out-of-pocket expenses of the Trust's trustees, who are "interested persons" of
the Trust (as defined in the Act).
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(b) The Trust shall bear all expenses of the Fund's
organization, operations, and business not specifically assumed or agreed to be
paid by the Adviser as provided in this Agreement. In particular, but without
limiting the generality of the foregoing, the Trust on behalf of the Fund and
out of its assets shall pay:
(A) CUSTODY AND ACCOUNTING SERVICES. All expenses of the
transfer, receipt, safekeeping, servicing and accounting for the cash,
securities, and other property of the Fund, including all charges of
depositories, custodians, and other agents, if any;
(B) SHAREHOLDER SERVICING. All expenses of maintaining and
servicing shareholder accounts, including all charges for transfer,
shareholder recordkeeping, dividend disbursing, redemption, and other
agents for the benefit of the Fund;
(C) BOOKS AND RECORDS. All costs and expenses associated with
the maintenance of the Fund's books of account and records as required
by the Act;
(D) SHAREHOLDER MEETINGS. All fees and expenses incidental to
holding meetings of shareholders, including the printing of notices
and proxy material, and proxy solicitation therefor, provided that the
Adviser shall be responsible for and assume all expenses and fees with
respect to meetings of the Fund's shareholders held solely for the
benefit of the Adviser;
(E) PROSPECTUSES AND STATEMENTS OF ADDITIONAL INFORMATION. All
expenses of preparing and printing of annual or more frequent
revisions of the Prospectus and Statement of Additional Information
relating to the offering of the Fund's shares and of mailing them to
shareholders;
(F) PRICING. All expenses of computing the Fund's net asset
value per share, including the cost of any equipment or services used
for obtaining price quotations;
(G) COMMUNICATION EQUIPMENT. All charges for equipment or
services used for communication between the Adviser or the Trust and
the custodian, transfer agent or any other agent selected by the
Trust;
(H) LEGAL AND ACCOUNTING FEES AND EXPENSES. All charges for
services and expenses of the Trust's legal counsel and independent
auditors for the benefit of the Trust;
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(I) TRUSTEES' FEES AND EXPENSES. All compensation of trustees,
other than those who are interested persons of or affiliated with the
Adviser, and all expenses incurred in connection with their service
and meetings;
(J) FEDERAL REGISTRATION FEES. All fees and expenses of
registering and maintaining the registration of the Trust under the
Act and the registration of Fund shares under the Securities Act of
1933, as amended (the "1933 Act"), including all fees and expenses
incurred in connection with the preparation, printing and filing of
any registration statement, Prospectus and Statement of Additional
Information under the 1933 Act or the Act, and any amendments or
supplements thereto that may be made from time to time;
(K) STATE REGISTRATION FEES. All fees and expenses (including
the compensation of personnel who may be employed by the Adviser or an
affiliate) of qualifying and maintaining qualification of the Trust
and of the Fund shares for sale under securities laws of various
states or jurisdictions, and of registration and qualification of the
Trust under all other laws applicable to the Trust or its business
activities (including registering the Trust as a broker-dealer, or any
officer of the Trust or any person as agent or salesman of the Trust
in any state);
(L) ISSUE AND REDEMPTION OF TRUST SHARES. All expenses incurred
in connection with the issue, redemption, and transfer of Fund shares,
including the expense of confirming all Fund share transactions, and
of preparing and transmitting the Fund's share certificates;
(M) BONDING AND INSURANCE. All expenses of bond, liability, and
other insurance coverage required by law or deemed advisable by the
Board of Trustees;
(N) BROKERAGE COMMISSIONS. All brokerage commissions and other
charges incident to the purchase, sale, or lending of the Fund's
portfolio securities;
(O) TAXES. All taxes or governmental fees payable by or in
respect of the Trust or Fund to federal, state, or other governmental
agencies, domestic or foreign, including stamp or other transfer
taxes;
(P) TRADE ASSOCIATION FEES. All fees, dues, and other expenses
incurred in connection with the Trust's membership in any trade
association or other investment organization;
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(Q) INTEREST. All interest which may accrue and be payable as a
result of the Fund's activities;
(R) STATIONERY AND POSTAGE. The cost of all stationery and
postage required by the Fund, unless otherwise payable by another
party with respect to an activity or expense referred to above; and
(S) NONRECURRING AND EXTRAORDINARY EXPENSES. Such nonrecurring
expenses as may arise, including the costs of actions, suits, or
proceedings to which the Trust on behalf of the Fund is a party and
the expenses the Trust on behalf of the Fund may incur as a result of
its legal obligation to provide indemnification to its officers,
trustees, and agents.
(c) In the event that the Trust offers other series of its
shares in the future, then the Fund shall only be responsible for expenses
directly attributable to it and its operations and for such other costs and
expenses of the Trust as the Board of Trustees may by resolution or otherwise
direct.
7. REIMBURSEMENT FOR ADVANCED COSTS AND EXPENSES. To the extent the
Adviser incurs any costs or performs any services which are an obligation of the
Trust or Fund, as set forth herein, the Trust on behalf of the Fund and out of
the Fund's assets shall promptly reimburse the Adviser for such costs and
expenses. To the extent the services for which the Fund is obligated to pay are
performed by the Adviser, the Adviser shall be entitled to recover from the Fund
only to the extent of its actual costs for such services.
8. FEES. (a) The Trust on behalf of the Fund and out of the Fund's
assets agrees to pay to the Adviser, and the Adviser agrees to accept, as full
compensation for all services furnished or provided to the Trust and Fund
hereunder, and as full reimbursement for all expenses assumed by the Adviser, a
management fee computed at the rate of 1.00% per annum of the average daily net
assets of the Fund.
(b) The management fee shall be accrued daily during each month
by the Trust on behalf of the Fund and paid to the Adviser on the first business
day of the succeeding month. The initial monthly fee under this Agreement shall
be payable on the first business day of the first month following the effective
date of this Agreement. The fee to the Adviser shall be prorated for the
portion of any month in which this Agreement is in effect which is not a
complete month according to the proportion which the number of calendar days in
the month during which the Agreement is in effect bears to the calendar days in
the month. If this Agreement is terminated prior to the end of any month, the
fee to the Adviser shall be payable within ten (10) days after the date of
termination.
(c) The Adviser may reduce or waive any portion of the
compensation due to it hereunder, or for reimbursement of expenses by the Trust
pursuant to
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Paragraph 7 of this Agreement, and any such reduction or waiver shall be
applicable only with respect to the specific items waived and shall not
constitute a waiver of any future compensation or reimbursement due to the
Adviser hereunder. In the event that expenses of the Fund for any fiscal year
should exceed the expense limitation on investment company expenses imposed by
any statute or regulatory authority of any jurisdiction in which shares of the
Fund are qualified for offer or sale, the compensation due the Adviser for such
fiscal year shall be reduced by the amount of such excess by a reduction or
refund thereof, or by the Adviser's assumption of expenses of the Fund. Any fee
withheld pursuant to this paragraph from the Adviser (including by way of the
assumption of expenses by the Adviser) shall be reimbursed by the Trust to the
Adviser in the first fiscal year or the second fiscal year next succeeding the
fiscal year of the withholding to the extent permitted by the applicable state
law to the extent the expenses of the Fund for the next succeeding fiscal year
or second succeeding fiscal year do not exceed any such expense limitation in
effect at the time, or any more restrictive limitation to which the Adviser has
agreed.
(d) The Adviser may agree not to require payment of any portion
of the compensation or reimbursement of expenses otherwise due to it pursuant to
this Agreement prior to the time such compensation or reimbursement has accrued
as a liability of the Trust. Any such agreement shall be applicable only with
respect to the specific items covered thereby and shall not constitute an
agreement not to require payment of any future compensation or reimbursement due
to the Adviser hereunder.
9. SHORT POSITIONS IN FUND'S SHARES. The Adviser agrees that
neither it nor any of its officers or employees shall take any short position in
the shares of the Fund. This prohibition shall not prevent the purchase of such
shares by any of the officers and Trustees or employees of the Adviser or any
trust, pension, profit-sharing or other benefit plan for such persons or
affiliates thereof, at a price not less than the net asset value thereof at the
time of purchase, as allowed pursuant to rules promulgated under the Act.
10. RELATIONSHIP TO PROVISIONS OF AGREEMENT AND DECLARATION OF TRUST.
Nothing herein contained shall be deemed to require the Trust to take any action
contrary to its Agreement and Declaration of Trust or any applicable statute or
regulation, or to relieve or deprive the Board of Trustees of the Trust of its
responsibility for and control of the conduct of the affairs of the Trust and
Fund.
11. DUTIES AND STANDARDS OF CARE. (a) In the absence of willful
misfeasance, bad faith, gross negligence, or reckless disregard of obligations
or duties hereunder on the part of the Adviser, the Adviser shall not be subject
to liability to the Fund or to any shareholder of the Fund for any act or
omission in the course of, or connected with, rendering services hereunder or
for any losses that may be sustained in the purchase, holding or sale of any
security by the Fund.
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(b) No provision of this Agreement shall be construed to protect
any Trustee or officer of the Trust or director or officer of the Adviser from
liability in violation of Sections 17(h) and (i) of the Act.
(c) A copy of the Agreement and Declaration of Trust of the
Trust is on file with the Secretary of State of The Commonwealth of
Massachusetts and notice is hereby given that this Agreement is executed on
behalf of the Trustees of the Trust as Trustees, and not individually, and the
obligations arising out of this Agreement are not binding upon the Trustees or
holders of the Trust's shares individually but are binding only upon the assets
and property of the Fund. The Adviser acknowledges that it has received notice
of and accepts the limitations of liability as set forth in the Agreement and
Declaration of Trust of the Trust. The Adviser agrees that the Trust's
obligations hereunder shall be limited to the Fund and to its assets, and that
the Adviser or any affiliated or related party shall not seek satisfaction of
any such obligation from any shareholder of the Fund nor from any trustee,
officer, employee or agent of the Trust.
12. TERM AND RENEWAL. This Agreement shall remain in effect for a
period of two (2) years, unless sooner terminated in accordance with Paragraph
13 hereof, and shall continue in effect from year to year thereafter so long as
such continuation is approved at least annually by (i) the Board of Trustees of
the Trust or by the vote of a majority of the outstanding voting securities of
the Fund, and (ii) the vote of a majority of the Trustees of the Trust who are
not parties to this Agreement or interested persons of any such party, cast in
person at a meeting for the purpose of voting on such approval.
13. TERMINATION. This Agreement may be terminated at any time,
without payment of any penalty, by the Board of Trustees of the Trust or by a
vote of a majority of the Fund's outstanding voting securities, upon sixty (60)
days' written notice to the Adviser, and by the Adviser upon sixty (60) days'
written notice to the Trust. This Agreement shall also terminate in the event
of any transfer or assignment thereof, as defined in the Act.
14. CERTAIN DEFINITIONS. The terms "majority of the outstanding
voting securities" of the Trust or Fund and "interested persons" shall have the
meanings as set forth in the Act. The term "net assets" shall have the meaning
and shall be calculated as set forth in the Trust's Registration Statement from
time to time.
15. SEVERABILITY. If any provision of this Agreement shall be held
or made invalid by a court decision, statute, rule, or otherwise, the remainder
of this Agreement shall not be affected thereby.
16. HEADINGS. The headings used herein are for convenience and ease
of reference only. No legal effect is intended, nor is to be derived from such
headings.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and attested by their duly authorized officers, all as of the
day and year first above written.
XXXXXXXXX XXXXXXXX INVESTMENT TRUST
/s/ Xxxxx X. Xxxxx
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Treasurer
XXXXXXXXX, XXXXXXXX & COMPANY
INVESTMENT MANAGEMENT, L.P.
By: Bayview Holdings, Inc.,
General Partner
/s/ Xxxxxx X. Xxxxx
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President
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