INVESTMENT MANAGEMENT CONTRACT
Contract made as of December 12, 2002, between, Hillview Investment
Trust II, a Delaware business trust ("Trust") on behalf of Hillview/REMS
Leveraged REIT Fund (the "Fund"), and Hillview Capital Advisors, LLC, a Delaware
limited liability company (the "Manager").
WHEREAS the Trust is registered under the Investment Company Act of
1940, as amended ("1940 Act") as an open-end management investment company; and
WHEREAS the Trust currently consists of three series -- Hillview Alpha
Fund, Hillview International Alpha Fund and the Fund; and
WHEREAS the Trust, on behalf of the Fund, has entered into an
Investment Advisory Agreement dated December 12, 2002 ("Advisory Agreement")
with Real Estate Management Services Group, LLC (the "Adviser"); and
WHEREAS the Trust desires to retain the Manager as investment manager
to furnish certain management services to the Trust and the Fund, and the
Manager is willing to furnish such services;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, it is agreed between the parties hereto as follows:
1. Appointment and Acceptance. The Trust hereby appoints the Manager as
investment manager for the period and on the terms set forth in this Contract.
The Manager accepts such appointment and agrees to render the services herein
set forth, for the compensation herein provided.
2. Duties as Investment Manager.
(a) The Manager will oversee the provision of administration,
custodial, accounting, bookkeeping, transfer and dividend disbursing agency or
similar services to the Fund by any entity selected by the Trust's Board of
Trustees ("Board") to perform such services.
(b) The Manager will oversee the monitoring of compliance of the
Adviser with the investment objective, policies and restrictions of the Fund as
well as compliance with the 1940 Act, the rules thereunder, and all applicable
federal and state securities laws and regulations, and review and report to the
Board on such compliance and on the services described in paragraph 2(a) hereof
as overseen by the Manager. However, the Manager shall not be responsible for
ensuring the Fund's compliance with applicable federal and state securities laws
and regulations.
(c) On the Manager's own initiative, the Manager will apprise, or cause
the Adviser to apprise, the Trust of important developments materially affecting
the Fund and will furnish the Trust, from time to time, with such information as
may be appropriate for this purpose. Further, the Manager agrees to furnish to
the Board such periodic and special reports as the Board may reasonably request.
(d) The Manager will furnish to the Fund, at its own expense and
without remuneration from or other cost to the Fund, the following:
(i) Office Space. The Manager will provide office space in the
offices of the Manager or in such other place as may be reasonably
agreed upon by the parties hereto from time to time;
(ii) Personnel. The Manager will provide necessary executive
and other personnel, including personnel for the performance of
clerical and other office functions, exclusive of those functions:
(A) related to and to be performed under the Trust's contract or
contracts for administration, custodial, accounting, bookkeeping,
transfer and dividend disbursing agency or similar services by any
entity, including the Manager or its affiliates, selected to perform
such services under such contracts; and (B) related to the services
to be provided by the Adviser pursuant to the Advisory Agreement;
and
(iii) Preparation of Prospectus and Other Documents. The
Manager will provide other information and services, other than
services of outside counsel or independent accountants or services
to be provided by the Adviser under the Advisory Agreement or an
administrator under an administration contract, required in
connection with the preparation of all registration statements and
Prospectuses, prospectus supplements, Statements of Additional
Information, all annual, semi-annual, and periodic reports to
shareholders of the Fund, regulatory authorities, or others, and all
notices and proxy solicitation materials, furnished to shareholders
of the Fund or regulatory authorities, and all tax returns.
(e) The Manager will oversee the computation of the net asset value and
the net income of the Fund as described in the currently effective registration
statement of the Trust under the Securities Act of 1933, as amended, and the
1940 Act and any supplements thereto ("Registration Statement") or as more
frequently requested by the Board.
(f) The Manager will oversee the maintenance of all books and records
with respect to the securities transactions of the Fund, and will furnish the
Board with such periodic and special reports as the Board reasonably may
request. In compliance with the requirements of Rule 31a-3 under the 1940 Act,
the Manager hereby agrees that all records which it maintains for the Fund are
the property of the Trust, agrees to preserve for periods prescribed by Rule
31a-2 under the 1940 Act any records which it maintains for the Fund and which
are required to be maintained by Rule 31a-1 under the 1940 Act, and further
agrees to surrender promptly to the Trust any records which it maintains for
Fund upon request by the Trust.
3. Further Duties. In all matters relating to the performance of this Contract,
the Manager will act in conformity with the Agreement and Declaration of Trust,
By-Laws and Registration Statement of the Trust and with the instructions and
directions of the Board and will comply with the requirements of the 1940 Act,
the rules thereunder, and all other applicable federal and state laws and
regulations.
4. Services Not Exclusive. The services furnished by the Manager hereunder are
not to be deemed exclusive and the Manager shall be free to furnish similar
services to others so long as its services under this Contract are not impaired
thereby. Nothing in this Contract shall limit or restrict the right of any
director, officer or employee of the Manager, who may also be a Trustee, officer
or employee, of the Trust, to engage in any other business or to devote his or
her time and attention in part to the management or other aspects of any other
business, whether of a similar nature or a dissimilar nature.
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5. Expenses.
(a) During the term of this Contract, the Fund will bear all its
expenses and its pro rata share of the total expenses incurred by the Trust that
are not specifically assumed by the Manager.
(b) Expenses incurred by the Trust, all or a portion of which may be
allocable to the Fund in accordance with the Trust's Agreement and Declaration
of Trust, will include but not be limited to the following: (i) fees payable to
and expenses incurred on behalf of the Fund by the Manager under this Contract;
(ii) fees and other compensation and expenses of the Adviser pursuant to the
Advisory Agreement approved by the Trust; (iii) expenses of organizing the Fund;
(iv) expenses of preparing and filing reports and other documents with
governmental and regulatory agencies; (v) filing fees and expenses relating to
the registration and qualification of the Fund's shares and the Trust under
federal and/or state securities laws and maintaining such registrations and
qualifications; (vi) costs incurred in connection with the issuance, sale or
repurchase of the Fund's shares of beneficial interest; (vii) the fees and
salaries payable to the Trust's Trustees who are not parties to this Contract or
interested persons of any such party ("Independent Trustees"); (viii) all
expenses incurred in connection with the Independent Trustees' services,
including travel expense; (ix) taxes (including any income or franchise taxes)
and governmental fees; (x) costs of any liability, uncollectible items of
deposit and other insurance and fidelity bonds; (xi) any costs, expenses or
losses arising out of a liability of or claim for damages or other relief
asserted against the Trust or Fund for violation of any law; (xii) interest
charges; (xiii) legal, accounting and auditing expenses, including legal fees of
special counsel for the Independent Trustees; (xiv) charges of custodians,
transfer agents, pricing agents and other agents; (xv) expenses of disbursing
dividends and distributions; (xvi) expenses of setting in type, printing and
mailing reports, notices and proxy materials for existing shareholders; (xvii)
any extraordinary expenses (including fees and disbursements of counsel, costs
of actions, suits or proceedings to which the Trust is a party and the expenses
the Trust may incur as a result of its legal obligation to provide
indemnification to the Trust's officers, Trustees, employees and agents)
incurred by the Fund; (xiiiii) fees, voluntary assessments and other expenses
incurred in connection with membership in investment company organizations;
(xix) costs of mailing and tabulating proxies and costs of meetings of
shareholders, the Board and any committees thereof; (xx) the cost of investment
company literature and other publications provided by the Trust to its Trustees
and officers; and (xxi) costs of mailing, stationery and communications
equipment.
(c) The Manager will assume the cost of any compensation received by
the officers of the Trust and by the Interested Trustees who are employees of
the Manager.
(d) The payment or assumption by the Manager of any expense of the
Trust or the Fund that the Manager is not required by this Contract to pay or
assume shall not obligate the Manager to pay or assume the same or any similar
expense of the Trust or the Fund on any subsequent occasion.
6. Compensation.
(a) For the services provided to the Fund under this Contract, the Fund
shall pay the Manager an annual fee, payable monthly, based upon the Fund's
average daily assets as set forth in Appendix A. Such compensation shall be paid
solely from the assets of the Fund.
(b) The fee shall be computed daily and paid monthly to the Manager on
or before the last business day of the next succeeding calendar month.
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(c) If this Contract becomes effective or terminates before the end of
any month, the fee for the period from the effective date to the end of the
month or from the beginning of such month to the date of termination, as the
case may be, shall be prorated according to the proportion which such period
bears to the full month in which such effectiveness or termination occurs.
7. Limitation of Liability of the Manager and Indemnification. The Manager and
its delegates shall not be liable for any costs or liabilities arising from any
error of judgment or mistake of law or any loss suffered by the Fund, the Trust
or any of the Fund's shareholders in connection with the matters to which this
Contract relates, except a loss resulting from willful misfeasance, bad faith or
gross negligence on the part of the Manager in the performance by the Manager of
its duties hereunder or from reckless disregard by the Manager of its
obligations and duties under this Contract. The Fund shall indemnify the Manager
and its directors, officers and employees for any losses, damages, liabilities,
costs and expenses ("Losses") incurred by the Manager by reason of or arising
out of any act or omission by the Trust under this Contract, or by any breach of
warranty, representation or agreement hereunder, except to the extent that such
losses arise as a result of the negligence of the Manager in the performance by
the Manager of its duties under this Contract.
Any person, even though also an officer, partner, employee, or agent of
the Manager, who may be or become an officer, Trustee, employee or agent of the
Trust shall be deemed, when rendering services to the Fund or the Trust or
acting with respect to any business of the Fund or the Trust, to be rendering
such service to or acting solely for the Fund or the Trust and not as an
officer, partner, employee, or agent or one under the control or direction of
the Manager even though paid by it.
8. Duration and Termination.
(a) This Contract shall become effective upon the date hereabove
written, provided that this Contract shall not take effect unless it has first
been approved (i) by a vote of a majority of the Independent Trustees, cast in
person at a meeting called for the purpose of voting on such approval, and (ii)
by vote of a majority of the Fund's outstanding voting securities.
(b) Unless sooner terminated as provided herein, this Contract shall
continue in effect for two years from the above written date. Thereafter, if not
terminated, with respect to the Fund this Contract shall continue automatically
for successive annual periods, provided that such continuance is specifically
approved at least annually (i) by a vote of a majority of the Independent
Trustees, cast in person at a meeting called for the purpose voting on such
approval, and (ii) by the Board or by vote of a majority of the outstanding
voting securities of the Fund.
(c) Notwithstanding the foregoing, with respect to the Fund this
Contract may be terminated at any time, without the payment of any penalty, by
vote of the Board or by a vote of a majority of the outstanding voting
securities of the Fund on sixty days' written notice to the Manager or by the
Manager at any time, without the payment of any penalty, on sixty days' written
notice to the Trust. This Contract will automatically terminate in the event of
its assignment.
9. Amendment of this Contract. No provision of this Contract may be 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, and no amendment of this Contract shall be effective
until approved by vote of a majority of the Fund's outstanding voting
securities, when required by the 1940 Act.
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10. Governing Law. This Contract shall be construed in accordance with the laws
of the State of Delaware (without regard to Delaware conflict or choice of law
provisions) and the 1940 Act. To the extent that the applicable laws of the
State of Delaware conflict with the applicable provisions of the 1940 Act, the
latter shall control.
11. License Agreement. The Trust shall have the non-exclusive right to use the
name "Hillview" to designate the Fund only so long as Hillview Capital Advisors,
LLC serves as investment manager to the Trust with respect to the Fund.
12. Limitation of Shareholder Liability. The Manager is hereby expressly put on
notice of the limitation of shareholder liability as set forth in the
Declaration of Trust of the Trust and agrees that obligations assumed by the
Trust pursuant to this Agreement shall be limited in all cases to the Fund and
its assets, and if the liability relates to one or more series, the obligations
hereunder shall be limited to the respective assets of the Fund. The Manager
further agrees that it shall not seek satisfaction of any such obligation from
the shareholders or any individual shareholder of the Fund, nor from the
Trustees or any individual Trustee of the Trust.
13. Miscellaneous. The captions in this Contract are included for convenience of
reference only and in no way define or limit any of the provisions hereof or
otherwise affect their construction or effect. If any provision of this Contract
shall be held or made invalid by a court decision, statute, rule or otherwise,
the remainder of this Contract shall not be affected thereby. This Contract
shall be binding upon and shall inure to the benefit of the parties hereto and
their respective successors. As used in this Contract, the terms "majority of
the outstanding voting securities," "interested person," "assignment," "broker,"
"dealer," "national securities exchange," "net assets," "prospectus," "sale,"
"sell" and "security" shall have the same meaning as such terms have in the 1940
Act, subject to such exemption as may be granted by the Securities and Exchange
Commission by any rule, regulation or order. Where the effect of a requirement
of the 1940 Act reflected in any provision of this Contract is made less
restrictive by a rule, regulation or order of the Securities and Exchange
Commission, whether of special or general application, such provision shall be
deemed to incorporate the effect of such rule, regulation or order.
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IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be executed by their officers designated as of the day and year first above
written.
HILLVIEW INVESTMENT TRUST II:
on behalf of
HILLVIEW/REMS LEVERAGED REIT FUND
Attest: /s/ Xxxxxx X. Xxxxxxx By: /s/ Xxxxx X. Xxxxxxx
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Name: Xxxxxx X. Xxxxxxx Name: Xxxxx X. Xxxxxxx
Title: Secretary Title: President and Trustee
HILLVIEW CAPITAL ADVISORS, LLC
Attest: /s/ Xxxxxx X. Xxxxxxx By: /s/ Xxxxx X. Xxxxxxx
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Name: Xxxxxx X. Xxxxxxx Name: Xxxxx X. Xxxxxxx
Title: Chief Operating Officer Title: President and Managing Partner
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APPENDIX A
TO
MANAGEMENT CONTRACT
The Fund shall pay the Manager a fee, computed daily and paid monthly,
at the annual rate of 0.25% of the Fund's average daily net assets.
Dated: December 12, 2002
A-1
