Exhibit 24(b)(5)(a)
INVESTMENT ADVISORY AGREEMENT
AGREEMENT, made the 22nd day of November, 1995, by and between
XXXXXXXXXXX QUEST FOR VALUE FUNDS, a Massachusetts business trust
(hereinafter referred to as the "Company"), and XXXXXXXXXXX
MANAGEMENT CORPORATION (hereinafter referred to as "OMC").
WHEREAS, the Company is an open-end, diversified management
investment company registered as such with the Securities and
Exchange Commission (the "Commission") pursuant to the Investment
Company Act of 1940 (the "Investment Company Act"), and OMC is an
investment adviser registered as such with the Commission under the
Investment Advisers Act of 1940;
WHEREAS, each of Growth and Income Value Fund, Quest Small Cap
Value Fund, Quest Opportunity Value Fund and Quest Officers Value
Fund is a separately capitalized Series (the "Series") of the
Shares of beneficial interest to be issued by the Company
("Shares") pursuant to the Company's registration statement;
WHEREAS, the Company desires that OMC shall act as its
investment adviser with respect to each Series pursuant to this
Agreement;
NOW, THEREFORE, in consideration of the mutual promises and
covenants hereinafter set forth, it is agreed by and between the
parties, as follows:
1. General Provisions:
The Company hereby employs OMC and OMC hereby undertakes
to act as the investment adviser of the Company in connection with,
and for the benefit of, each Series(including any Series hereafter
created) and to perform for the Company such other duties and
functions in connection with each Series for the period and on such
terms as set forth in this Agreement. OMC shall, in all matters,
give to the Company and its Board of Trustees (the "Trustees") the
benefit of its best judgement, effort, advice and recommendations
and shall, at all times conform to, and use its best efforts to
enable the Company to conform to (i) the provisions of the
Investment Company Act and any rules or regulations thereunder;
(ii) any other applicable provisions of state or Federal law; (iii)
the provisions of the Declaration of Trust and By-Laws of the
Company as amended from time to time; (iv) policies and
determinations of the Trustees; (v) the fundamental policies and
investment restrictions of each Series as reflected in the
registration statement of the Company under the Investment Company
Act or as such policies may, from time to time, be amended and (vi)
the Prospectus and Statement of Additional Information of each
Series in effect from time to time. The appropriate officers and
employees of OMC shall be available upon reasonable notice for
consultation with any of the Trustees and officers of the Company
with respect to any matters dealing with the business and affairs
of the Company including the valuation of portfolio securities of
the Company which are either not registered for public sale or not
traded on any securities market.
2. Investment Management:
(a) OMC shall, subject to the direction and control by
the Trustees, (i) regularly provide investment advise and
recommendations to the Company with respect to the investments and
other investments for each Series; (ii) supervise continuously the
investment program of each Series of the Company and the
composition of its portfolio and determine what securities shall be
purchased or sold by; and(iii) arrange, subject to the provisions
of paragraph 7 hereof, for the purchase of securities and other
investments for each Series of the Company and the sale of
securities and other investments held in the portfolio of each
Series.
(b) Provided that the Company shall not be required to
pay any compensation for services under this Agreement other than
as provided by the terms of the Agreement and subject to the
provisions of paragraph 7 hereof, OMC may obtain investment
information, research or assistance from any other person, firm or
corporation to supplement, update or otherwise improve its
investment management services including entering into sub-advisory
agreements with other affiliated or unaffiliated registered
investment advisors to obtain specialized services.
(c) Provided that nothing herein shall be deemed to
protect OMC from willful misfeasance, bad faith or gross negligence
in the performance of its duties, or reckless disregard of its
obligations and duties under this Agreement, OMC shall not be
liable for any loss sustained by reason of good faith errors or
omissions in connection with any matters to which this Agreement
relates.
(d) Nothing in this Agreement shall prevent OMC or any
entity controlling, controlled by or under common control with OMC
or any officer thereof from acting as investment adviser for any
other person, firm or corporation or in any way limit or restrict
OMC or any of its directors, officers, stockholders or employees
from buying, selling or trading any securities for its or their own
account or for the account of others for whom it or they may be
acting, provided that such activities will not adversely affect or
otherwise impair the performance by OMC of its duties and
obligations under this Agreement.
3. Other Duties of OMC:
OMC shall, at its own expense, provide and supervise the
activities of all administrative and clerical personnel as shall be
required to provide effective corporate administration for the
Company, including the compilation and maintenance of such records
with respect to its operations as may reasonably be required; the
preparation and filing of such reports with respect thereto as
shall be required by the Commission; composition of periodic
reports with respect to operations of each Series of the Company
for its shareholders; composition of proxy materials for meetings
of the Company's shareholders; and the composition of such
registration statements as may be required by Federal and state
securities laws for continuous public sale of Shares of each Series
of the Company. OMC shall, at its own cost and expense, also
provide the Company with adequate office space, facilities and
equipment. OMC shall, at its own expenses, provide such officers
for the Company as the Board of Trustees may request.
4. Allocation of Expenses:
All other costs and expenses of each Series of the
Company not expressly assumed by OMC under this Agreement, or to be
paid by the Distributor of the Shares of each Series of the
Company, shall be paid by the Company on behalf of the appropriate
Series, including, but not limited to: (i) interest, taxes and
governmental fees; (ii) brokerage commissions and other expenses
incurred in acquiring or disposing of the portfolio securities and
other investments of each Series; (iii) insurance premiums for
fidelity and other coverage requisite to its operations; (iv)
compensation and expenses of its Trustees other than those
affiliated with OMC; (v) legal and audit expenses; (vi) custodian
and transfer agent fees and expenses; (vii) expenses incident to
the redemption of its Shares; (viii) expenses incident to the
issuance of its Shares against payment therefor by or on behalf of
the subscribers thereto; (ix) fees and expenses, other than as
hereinabove provided, incident to the registration under Federal
and state securities laws of Shares of the Company and Series for
public sale; (x) expenses of printing and mailing reports, notices
and proxy materials to shareholders of the Company and each Series;
(xi) except as noted above, all other expenses incidental to
holding meetings of the Company's shareholders; and (xii) such
extraordinary non-recurring expenses as may arise, including
litigation, affecting the Company or any Series thereof and any
legal obligation which the Company, or any Series of the Company,
may have to indemnify its officers and Trustees with respect
thereto. Any officers or employees of OMC or any entity
controlling, controlled by, or under common control with OMC who
also serve as officers, Trustees or employees of the Company shall
not receive any compensation from the Company or any Series thereof
for their services.
5. Compensation of OMC:
The Company agrees to pay OMC and OMC agrees to accept as
full compensation for the performance of all functions and duties
on its part to be performed pursuant to the provisions hereof, a
fee computed on the total net asset value of each Series of the
Company as of the close of each business day and payable monthly at
the annual rate for each Series set forth on Schedule A hereto.
6. Use of Name "Xxxxxxxxxxx" or "Quest For Value":
OMC hereby grants to the Company a royalty-free, non-
exclusive license to use the name "Xxxxxxxxxxx" or "Quest For
Value" in the name of the Company for the duration of this
Agreement and any extensions or renewals thereof. To the extent
necessary to protect OMC's rights to the name "Xxxxxxxxxxx" or
"Quest For Value" under applicable law, such license shall allow
OMC to inspect and, subject to control by the Company's Board,
control the nature and quality of services offered by the Company
under such name and may, upon termination of this Agreement, be
terminated by OMC, in which event the Company shall promptly take
whatever action may be necessary to change its name and discontinue
any further use of the name "Xxxxxxxxxxx" or "Quest For Value" in
the name of the Company or otherwise. The name "Xxxxxxxxxxx" and
"Quest For Value" may be used or licensed by OMC in connection with
any of its activities, or licensed by OMC to any other party.
7. Portfolio Transactions and Brokerage:
(a) OMC (and any Sub Advisor) is authorized, in
arranging the purchase and sale of the portfolio securities of each
Series of the Company to employ or deal with such members of
securities or commodities exchanges, brokers or dealers
(hereinafter "broker-dealers"), including "affiliated" broker-
dealers (as that term is defined in the Investment Company Act), as
may, in its best judgment, implement the policy of the Company to
obtain, at reasonable expense, the "best execution" (prompt and
reliable execution at the most favorable security price obtainable)
of the portfolio transactions of each Series of the Company as well
as to obtain, consistent with the provisions of subparagraph (c) of
this paragraph 7, the benefit of such investment information or
research as will be of significant assistance to the performance by
OMC of its investment management functions.
(b) OMC (and any Sub Advisor) shall select broker-
dealers to effect the portfolio transactions of each Series of the
Company on the basis of its estimate of their ability to obtain
best execution of particular and related portfolio transactions.
The abilities of a broker-dealer to obtain best execution of
particular portfolio transaction(s) will be judged by OMC (or any
Sub Advisor) on the basis of all relevant factors and
considerations including, insofar as feasible, the execution
capabilities required by the transaction or transactions; the
ability and willingness of the broker-dealer to facilitate the
portfolio transactions of each Series of the Company by
participating therein for its own account; the importance to the
Company of speed, efficiency or confidentiality; the broker-
dealer's apparent familiarity with sources from or to whom
particular securities might be purchased or sold; as well as any
other matters relevant to the selection of a broker-dealer for
particular and related transactions of each Series of the Company.
(c) OMC (and any Sub Advisor) shall have discretion, in
the interest of the Company and each Series, to allocate brokerage
on the portfolio transactions of each Series of the Company to
broker-dealers, other than an affiliated broker-dealers, qualified
to obtain best execution of such transactions who provide brokerage
and/or research services (as such services are defined in Section
28(e)(3) of the Securities Exchange Act of 1934) for each Series of
the Company and/or other accounts for which OMC or its affiliates
(or any Sub Advisor) exercise "investment discretion" (as that term
is defined in Section 3(a)(35) of the Securities Exchange Act of
1934) and to cause the Company or a Series to pay such broker-
dealers a commission for effecting a portfolio transaction for the
Company or a Series that is in excess of the amount of commission
another broker-dealer adequately qualified to effect such
transaction would have charged for effecting that transaction, if
OMC (or any Sub Advisor) determines, in good faith, that such
commission is reasonable in relation to the value of the brokerage
and/or research services provided by such broker-dealer viewed in
terms of either that particular transaction or the overall
responsibilities of OMC or its affiliates (or any Sub Advisor)
with respect to accounts as to which they exercise investment
discretion. In reaching such determination, OMC (or any Sub
Advisor) will not be required to place or attempt to place a
specific dollar value on the brokerage and/or research services
provided or being provided by such broker-dealer. In demonstrating
that such determinations were made in good faith, OMC (and any Sub
Advisor) shall be prepared to show that all commissions were
allocated for purposes contemplated by the Agreement and that the
total commissions paid by the Company and each Series over a
representative period selected by the Company's Trustees were
reasonable in relation to the benefits to the Company and each
Series.
(d) OMC (or any Sub Advisor) shall have no duty or
obligation to seek advance competitive bidding for the most
favorable commission rate applicable to any particular portfolio
transactions or to select any broker-dealer on the basis of its
purported or "posted" commission rate but will, to the best of its
ability, endeavor to be aware of the current level of the charges
of eligible broker-dealers and to minimize the expense incurred by
the Company and each Series for effecting its portfolio
transactions to the extent consistent with the interests and
policies of the Company and each Series as established by the
determinations of the Board of Trustees of the Company and the
provisions of this paragraph 7.
(e) The Company recognizes that an affiliated broker-
dealer: (i) may act as one of the Company's regular brokers for the
Company or a Series thereof so long as it is lawful for it so to
act; (ii) may be a major recipient of brokerage commissions paid by
the Company or a Series thereof; and (iii) may effect portfolio
transactions for the Company or a Series thereof only if the
commissions, fees or other renumeration received or to be received
by it are determined in accordance with procedures contemplated by
any rule, regulation or order adopted under the Investment Company
Act to be within the permissible level of such commissions.
(f) Subject to the foregoing provisions of this
paragraph 7, OMC (and any Sub Advisor) may also consider sales of
Shares of the Company, each Series thereof and the other funds
advised by OMC and its affiliates as a factor in the selection of
broker-dealers for its portfolio transactions.
8. Duration:
This Agreement will take effect on the date first set
forth above. Unless earlier terminated pursuant to paragraph 10
hereof, this Agreement shall remain in effect from year to year,
so long as such continuance shall be approved at least annually by
the Company's Board of Trustees, including the vote of the majority
of the Trustees of the Company who are not parties to this
Agreement or "interested persons" (as defined in the Investment
Company Act) of any such party, cast in person at a meeting called
for the purpose of voting on such approval, or by the holders of a
"majority" (as defined in the Investment Company Act) of the
outstanding voting securities of the Company, or each Series
thereof, and by such a vote of the Company's Board of Trustees.
9. Disclaimer of Shareholder or Trustee Liability:
OMC understands and agrees that the obligations of the
Company under this Agreement are not binding upon any shareholder
or Trustee of the Company personally, but bind only the Company and
the Company's property; OMC represents that it has notice of the
provisions of the Declaration of Trust of the Company disclaiming
shareholder or Trustee liability for acts or obligations of the
Company.
10. Termination.
This Agreement may be terminated (i) by OMC at any time
without penalty upon sixty days' written notice to the Company
(which notice may be waived by the Company); or (ii) by the Company
at any time without penalty upon sixty days' written notice to OMC
(which notice may be waived by OMC) provided that such termination
by the Company shall be directed or approved by the vote of a
majority of all of the Trustees of the Company then in office or by
the vote of the holders of a "majority" of the outstanding voting
securities of the Company (as defined in the Investment Company
Act).
11. Assignment or Amendment:
This Agreement may not be amended, or the rights of OMC
hereunder sold, transferred, pledged or otherwise in any manner
encumbered without the affirmative vote or written consent of the
holders of the "majority" of the outstanding voting securities of
the Company. This Agreement shall automatically and immediately
terminate in the event of its "assignment," as defined in the
Investment Company Act.
12. Definitions:
The terms and provisions of the Agreement shall be
interpreted and defined in a manner consistent with the provisions
and definitions contained in the Investment Company Act.
XXXXXXXXXXX QUEST FOR VALUE FUNDS
Attest: /s/ Xxxxxx X. Xxxx By: /s/ Xxxxxxx X. Xxxxxxxxx
------------------ ------------------------
Title: President
XXXXXXXXXXX MANAGEMENT
CORPORATION
Attest: /s/ Xxxxxxxxx X. Xxxx By: /s/ Xxxxxx X. Xxxxxxx
--------------------- -----------------------
Xxxxxxxxx X. Xxxx Xxxxxx X. Xxxxxxx
Secretary Executive Vice President
Schedule A
To
Investment Advisory Agreement
Between
Xxxxxxxxxxx Quest For Value Fu nds
and
Xxxxxxxxxxx Management Corpora tion
Annual Fee as a Percentage of Daily
Name of Series Total Net Assets
Growth and Income Value Fund 0.85% of all net assets
Officers Value Fund 1.00% of all net assets
Small Cap Value Fund 1.00 of first $400 million of net assets
0.90% of next $400 million of net assets
0.85% of net assets over $800 million
Opportunity Value Fund 1.00 of first $400 million of net assets
0.90% of next $400 million of net assets
0.85% of net assets of $800 million
advisory\q4seradv
