XXXXXXXXX XXXXXXXX INVESTMENT TRUST
INVESTMENT ADVISORY AGREEMENT
This INVESTMENT ADVISORY AGREEMENT ("Agreement") is made as of the ___ day
of February, 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) 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 that 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
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President
XXXXXXXXX, XXXXXXXX & COMPANY
INVESTMENT MANAGEMENT, L.P.
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President
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