EXHIBIT G
INVESTMENT MANAGEMENT AGREEMENT
This Agreement, dated as of the 1st day of January 1996, by
and between Xxxxx, Xxxxxxxx & Xxxx, Inc., a Massachusetts
corporation (the "Adviser"), and AH&H Partners Fund Limited
Partnership, a Massachusetts limited partnership (the
"Partnership").
WHEREAS, the Partnership wishes to retain the Adviser for the
purposes of managing and investing the assets of the Partnership
in its investment account (the "Account Assets"), and;
WHEREAS, the Adviser wishes to be retained by the Partnership
for such purposes.
NOW, THEREFORE, in consideration of the mutual promises set
forth in this Agreement, the Adviser and the Partnership agree to
be bound on the terms and conditions set forth below.
1. SERVICES AND AUTHORITY OF THE ADVISER. (a) The
Partnership authorizes the Adviser, from time to time and in its
sole discretion, to, and to direct brokers to, sell, purchase
(long, short, or any combination thereof), invest, reinvest,
exchange, retain, deposit or otherwise trade in or dispose of the
Account Assets and such authority shall specifically extend,
without limitation, to option contracts, and to the lending of
money or securities or the borrowing of money or securities for
proper Partnership purposes, and to give security therefor upon
such terms as the Adviser deems proper for the benefit of the
Partnership. The Adviser is further authorized to direct the
manner, method, time and place of such trading and disposition.
This Agreement shall serve as the Partnership's consent and
authority for all such action or non-action taken in the
discretion of the Adviser. The Adviser may, except as provided in
the Third Amended and Restated Agreement of Limited Partnership or
any further amendment or restatement thereof (the "Partnership
Agreement") deal with the Account Assets to the full extent
permitted to the Partnership as owner of the Account Assets
without seeking further consent from the Partnership. The Account
Assets shall include all contributions to capital made by the
partners of the Partnership during the term of this Agreement, and
any undistributed income, proceeds and realized gains from
investment of such assets in excess of all such contributions to
capital. The Partnership shall be responsible for the
determination of any amounts available for distribution to the
Partnership's partners and for making such distributions.
(b) The Adviser will maintain all books and records
with respect to the Partnership's securities transactions required
by subparagraphs (b)(5), (6), (9) and (10) of the Investment
Company Act of 1940, as amended (the "Investment Company Act"),
and paragraph (f) of Rule 31a-1 under the Investment Company Act
(other than those records being maintained by any custodian or
transfer agent of the Partnership) and preserve such records for
the period prescribed therefor by Rule 31a-2 of the Investment
Company Act.
(c) The Adviser shall also perform such other services
in connection with the management and administration of the
Partnership and the Account Assets as the Managing General
Partners of the Partnership shall reasonably request from time to
time.
2. BROKERAGE SERVICES. The Adviser shall have the
authority to select brokers or dealers to execute transactions in
the Partnership's account and to effect securities transactions
itself on behalf of the Partnership. The Partnership understands
and agrees that (i) the Adviser will use its best efforts to
obtain prompt execution of orders at the most favorable prices
reasonably obtainable, (ii) the Adviser will not be obligated to
seek the lowest available transaction cost, but may take into
account the financial stability and reputation of the brokerage
firm and the brokerage services as a broker/dealer, and (iii) if
the Adviser itself effects transactions in securities on behalf of
the Partnership, it will receive commissions for such services,
subject in all cases to the requirements of the Securities Laws,
to its fiduciary duties as general partner of the Partnership and
its fiduciary duties as broker to the Partnership.
3. SERVICE TO OTHER CLIENTS. The Partnership acknowledges
that the Adviser may perform investment advisory services for
other clients. In connection therewith, the Adviser may give
advice or may take action with respect to any of its clients which
may differ from advice given to or the timing and nature of action
taken with respect to the Partnership account. The Adviser shall
not be obligated to purchase or to sell for the Partnership a
position in any security which the Adviser, its principals,
affiliates or employees may acquire for its or their own account
or for the account of any other client if in the sole and absolute
discretion of the Adviser it is not for any reason practical or
desirable to purchase or to sell such security for the
Partnership's account. In addition, to the extent permitted by
law and subject to the Adviser's fiduciary duties to the
Partnership, transactions in securities may be accomplished on
behalf of clients other than the Partnership (but not on behalf of
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the Adviser itself) prior or subsequent to the time transactions
in the same securities may be effected for or executed by or on
behalf of the Partnership and at prices which may be different
from those prices at which transactions in the same securities are
effected for or executed by or on behalf of the Partnership.
4. LIMITATIONS ON FEES. In the event that applicable
Federal state or local law limits or restricts the payment to the
Adviser of the fees or reallocations contemplated by Section 6 of
this Agreement or commissions on brokerage transactions effected
by the Adviser on behalf of the Partnership, the Adviser agrees to
accept as full payment the portion of such fees, reallocations or
commissions allowed by law.
5. EXPENSES. The Partnership shall pay all costs and
expenses incurred in connection with management of the Account
Assets with the Adviser, including but not limited to all costs of
purchasing, selling, and carrying securities, interest on
borrowings, brokerage costs, and custodial fees.
6. FEES AND ALLOCATIONS. (a) For all services rendered by
the Adviser pursuant to this Agreement, the Adviser shall be
entitled to, and the Partnership shall pay the fees and make the
reallocations from the Partners Capital Accounts provided for in
this Section 6.
(b) The Partnership shall pay the Adviser a quarterly
management fee (the "Management Fee") equal to the twenty-five one
hundredths of one percent (0.25%) of the sum of the Capital
Account balances (determined before any allocation for fees under
this Agreement) of the Partners. The Management Fee shall be
calculated as of March 31, June 30, September 30 and December 31
in each year, and paid from the Account Assets within 30 days
thereof. If this Agreement is terminated pursuant to Section 7
hereof, the Partnership shall pay the Adviser within 30 days of
termination a final Management Fee which shall be prorated through
the effective date of termination.
(c) As of each Performance Allocation Date occurring in
December, the Partnership shall reallocate from the Capital
Accounts of the Partners to the Capital Account of the Adviser an
aggregate amount equal to fifteen percent (15%) of the amount, if
any, by which (x) the sum of the changes in the Adjusted Net Asset
Value of the Partnership as of each Valuation Date in such
Performance Allocation Period over the Net Asset Value as of the
immediately preceding Valuation Date exceeds (y) the sum of
(A) the Shortfall for the immediately preceding Performance
Allocation Period plus (B) the sum of the Base Amounts for
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Valuation Periods included in the Performance Allocation Period
ending on such Performance Allocation Date. As of any Performance
Allocation Date occurring other than in December the Partnership
shall reallocate from the Capital Accounts of the Partners to the
Capital Account of the Adviser an aggregate amount equal to an
amount equal to (x) fifteen percent (15%) of the amount, if any,
by which (A) the sum of the changes in the Adjusted Net Asset
Value of the Partnership as of each Valuation Date in the
Performance Allocation Period over the Net Asset Value as of the
immediately preceding Valuation Date exceeds (B) the sum of (1)
the Shortfall for the second preceding Performance Allocation
Period plus (2) the sum of the Base Amounts for Valuation Periods
included in the period beginning on the first day of the
immediately preceding Performance Allocation Period and ending on
such Performance Allocation Date minus (y) the amount, if any, of
the Performance Fee paid on the immediately preceding Performance
Allocation Date.
7. DURATION AND TERMINATION OF THIS AGREEMENT. This
Agreement shall remain in force until January 1, 1998 and shall
continue for periods of one year thereafter, but only as long as
such continuance is specifically approved at least annually (a) by
the vote of a majority of the Managing General Partners of the
Partnership who are not interested persons (as defined in the
Investment Company Act) of the Partnership and have no financial
interest in this Agreement, cast in person at a meeting called for
the purpose of voting on such approval and (b) by a vote of a
majority of the Managing General Partners of the Partnership or a
majority of the outstanding Limited Partnership Interests. The
aforesaid requirement that continuance of this Agreement be
"specifically approved at least annually" shall be construed in a
manner consistent with the Investment Company Act and the rules
and regulations thereunder. This Agreement may, on 60 days'
written notice to the other party, be terminated at any time
without the payment of any penalty, by the Managing General
Partners of the Partnership, by the vote of a majority of the
outstanding Limited Partnership Interests, or by the Adviser.
This Agreement shall automatically terminate in the event of its
assignment. In interpreting the provisions of this Agreement, the
definitions contained in Section 2(a) of the Investment Company
Act (particularly the definitions of "interested person,"
"assignment" and "majority of the outstanding voting securities"),
as from time to time amended, shall be applied, subject, however,
to such exemptions as may be granted by the Securities and
Exchange Commission by any rule, regulation or order.
8. INDEMNIFICATION. The Partnership understands and agrees
that neither the Adviser nor any of its officers, directors or
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employees shall have any liability to the Partnership or to any
Partner for any loss suffered by the Partnership which arises out
of any action or inaction of the Adviser, except a loss resulting
from wilful misfeasance, bad faith or gross negligence by the
Adviser in the performance of the Adviser's duties under this
Agreement or from reckless disregard by the Adviser of its
obligations under this Agreement. The Adviser shall be
indemnified by the Partnership against any losses, judgments,
liabilities, expenses, and amounts paid in settlement of any
claims sustained by it in connection with the Partnership, except
for such losses, judgments, liabilities, expenses or amounts paid
in settlement resulting from the Adviser's wilful misfeasance, bad
faith, gross negligence or reckless disregard of its obligations
under this Agreement. The Partnership agrees to indemnify the
Adviser to the extent of its Account Assets to the full extent
permitted by the Massachusetts Uniform Limited Partnership Act, as
it may be amended, and as permitted by other applicable provisions
of law. Notwithstanding the above, the Adviser shall not be
indemnified for any losses, liabilities or expenses arising from
or out of an alleged violation of Federal or state securities laws
unless permitted by law.
9. NOTICE; PARTIES. Any notice required to be given
hereunder shall be in writing and shall be sent by registered or
certified first class mail, postage prepaid, with return receipt
requested, to the Adviser or the Partnership at the addresses
indicated below or to such other address as the parties may
hereafter direct in writing. The effective date of such notice
shall be three days after the date of mailing thereof.
10. BINDING EFFECT. This Agreement will be binding upon and
inure to the benefit of the successors, assigns and legal
representatives of the parties hereto.
11. AMENDMENT OF THIS AGREEMENT. No provision of this
Agreement 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. No amendment of this Agreement shall be effective
until approved by vote of the holders of a majority of Limited
Partnership Interests and by a majority of the Managing General
Partners of the Partnership, including a majority of the Managing
General Partners of the Partnership who are not interested persons
(as defined in the Investment Company Act) of the Partnership and
have no financial interest in this Agreement, cast in person at a
meeting called for the purpose of voting on such amendment.
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12. ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter
hereof.
13. GOVERNING LAW. This Agreement shall be governed by, and
interpreted in accordance with, the laws of the Commonwealth of
Massachusetts.
14. DEFINITIONS. (a) Unless otherwise defined in this
Agreement, all terms used in this Agreement shall have the
meanings set forth in the Partnership Agreement.
(b) The following terms used in this Agreement shall have the
meaning set forth below:
"Allocation Deficit" means, with respect to any Performance
Allocation Period, the amount, if any, by which (i) the sum of the
Base Amounts for Valuation Periods included in such Performance
Allocation Period exceeds (ii) the sum of the changes in the
Adjusted Net Asset Value of the Partnership as of each Valuation
Date in such Performance Allocation Period over the Net Asset
Value of the Partnership as of the immediately preceding Valuation
Date.
"Applicable Percentage" means one percent (1.5%) or, in the
case of any Valuation Period that is of a shorter duration than
three (3) months, the product of one percent (1.5%) and a
fraction, the numerator of which is the number of days that have
elapsed since the prior Valuation Date and the denominator of
which is 90.
"Base Amount" means, with respect to any Valuation Period
included in a particular Performance Allocation Period, the
Applicable Percentage of the Net Asset Value of the Partnership as
of the first day of such Performance Allocation Period (as
determined after all allocations and distributions made as of
dates prior to such first day have been made, but not including
any Capital Contributions made as of such first day), computed,
solely for purposes of this definition, with the following
adjustments:
(a) there shall be added to the Partnership's Net Asset
Value as of the first day such Performance Allocation
Period any Shortfall for the immediately preceding
Performance Allocation Period (computed, except as
provided in clause (c) below, without regard to any
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adjustments to such Shortfall on account of
distributions during the applicable Performance
Allocation Period);
(b) for such Valuation Period, there shall be added to the
Partnership's Net Asset Value as of the first day such
Performance Allocation Period all Capital Contributions
made by Partners during such Valuation Period and during
any prior Valuation Period included in such Performance
Allocation Period; and
(c) upon each distribution to one or more Partners as of a
date during such Valuation Period, there shall be
subtracted, for purposes of determining Base Amounts for
subsequent Valuation Periods included in such
Performance Allocation Period, from the Partnership's
Net Asset Value as of the first day for such Performance
Allocation Period (as determined after taking into
account all prior adjustments thereto made on account of
any Shortfall for the immediately preceding Performance
Allocation Period pursuant to clause (a), any prior
Capital Contributions made by a Partner during such
Performance Allocation Period pursuant to clause (b) and
any distributions made to Partners as of prior dates
during such Performance Allocation Period pursuant to
this clause (c)) an amount equal to such distribution.
"Performance Allocation Date" means (i) each Valuation Date
occurring in December and (ii) the Valuation Date as of which the
Partnership is liquidated.
"Performance Allocation Period" means, except as otherwise
provided herein, each period ending on a Performance Allocation
Date and beginning on the day after the immediately preceding
Performance Allocation Date.
"Shortfall" means, with respect to any Performance Allocation
Period, the amount, if any, of the Allocation Deficit for such
Performance Allocation Period, computed with the following
adjustments:
(a) in computing the Allocation Deficit for such Performance
Allocation Period, there shall be added to the sum of
the Base Amounts for Valuation Periods included in such
Performance Allocation Period the amount of the
Shortfall, if any, for the immediately preceding
Performance Allocation Period (taking into account all
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adjustments to such prior Shortfall pursuant to
clause (b) on account of distributions to Limited
Partners); and
(b) for each distribution to Limited Partners pursuant to
Article 15(b) of the Partnership Agreement as of a date
during the period beginning on the Performance
Allocation Date closing such Performance Allocation
Period and ending on the date immediately preceding the
next Performance Allocation Date, there shall be
subtracted from the Allocation Deficit for such
Performance Allocation Period (as determined after
reducing such Allocation Deficit pursuant to this
clause (b) for all distributions, in the order made, to
Partners pursuant to Article 15(b) of the Partnership
Agreement as of prior dates during the period beginning
on the Performance Allocation Date closing such
Performance Allocation Period and ending on the date
immediately preceding the next Performance Allocation
Date) an amount equal to all distributions, in the order
made, to Managing General or Limited Partners pursuant
to Article 15(b) as of prior dates during the period
beginning on the Performance Allocation Date closing
such Performance Allocation Period and ending on the
next following Performance Allocation Date).
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the date first written above.
XXXXX, XXXXXXXX & XXXX, INC.
By: /s/ Xxxxx X. Xxxxx, III
_____________________________
Address: 00 Xxxxx Xxxxxx
Xxxxxx, XX 00000
AH&H PARTNERS FUND LIMITED PARTNERSHIP
By: Xxxxx, Xxxxxxxx & Xxxx, Inc., its
Advisory General Partner
By: /s/ Xxxxx X. Xxxxx, III
_____________________________
Address: 00 Xxxxx Xxxxxx
Xxxxxx, XX 00000
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