MONEY MANAGER AGREEMENT
Effective Date: May 1, 2007
Termination Date: Two years after Effective Date
Fund and Account: ACCESSOR SMALL TO MID CAP FUND
SSgA Funds Management, Inc.
Xxx Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Re: Accessor Funds, Inc. Money Manager Agreement
Gentlemen:
Accessor Funds, Inc., a Maryland corporation ("Accessor Funds"), is an
open-end management investment company of the series type registered as an
investment company under the Investment Company Act of 1940, as amended (the
"1940 Act"), and subject to the rules and regulations promulgated thereunder.
Accessor Funds issues shares in separate diversified portfolios, each with a
different investment objective and policies.
Accessor Capital Management LP, a Washington limited partnership (the
"Manager") acts as the manager and administrator of Accessor Funds pursuant to
the terms of a Management Agreement, and is an "investment adviser," as that
term is defined in Section 2(a)(20) of the 1940 Act, to Accessor Funds. The
Manager is responsible for the day-to-day management and administration of
Accessor Funds and for the coordination of investments of each portfolio's
assets; however, specific portfolio purchases and sales for each portfolio's
investment portfolio, or a portion thereof, are to be made by the portfolio
management organizations recommended and selected by the Manager, subject to the
approval of the Board of Directors of Accessor Funds (the "Board").
1. Appointment as a Money Manager. The Manager and Accessor Funds hereby
appoint and employ SSgA Funds Management, Inc., a Massachusetts corporation (the
"Money Manager"), as a discretionary money manager to Accessor Funds' Small to
Mid Cap Fund, on the terms and conditions set forth herein. The Manager
determines from time to time that portion of the assets of the Small to Mid Cap
Fund that are to be assigned to the Money Manager (the "Account"). The Account
and those assets of the Small to Mid Cap Fund managed by the Manager or another
money manager as determined by the Manager are referred to as the "Fund".
2. Acceptance of Appointment; Standard of Performance. The Money Manager
accepts the appointment as a discretionary money manager and, subject to the
provisions of Section 13 hereof, agrees to use its best professional judgment to
make and implement investment decisions for the Fund with respect to the
investments of the Account in accordance with the provisions of this Agreement.
3. Fund Management Services of the Money Manager. The Money Manager is
hereby employed and authorized to select portfolio securities for investment by
the Fund, to determine to purchase and sell securities or other permitted
investments for the Account, and upon making any purchase or sale decision, to
place orders for the execution of such portfolio transactions in accordance with
Accessor Funds' operational procedures, as may be amended in writing by the
parties from time to time. In providing portfolio management services to the
Account, the Money Manager shall be subject to such investment restrictions as
are set forth in the 1940 Act and rules thereunder, the supervision and control
of the Board, such specific instructions as the Board may adopt and communicate
to the Money Manager, the investment objectives, policies and restrictions of
the Fund furnished pursuant to paragraph 4, and instructions from the Manager.
The Money Manager shall maintain on behalf of the Fund all accounts, books,
records or other documents that are required to be maintained pursuant to the
1940 Act, and the Investment Advisers Act of 1940, as amended (the "Advisers
Act"), or any rule or regulation thereunder and Accessor Funds' policies and
procedures (as may be amended in writing from time to time) and shall be
responsible for making all filings on Form 13F. For purpose of clarity, the Fund
Accounting Agent's records will be considered the official records of the Fund.
At Accessor Funds' or the Manager's reasonable request (as communicated by the
Board or the officers of such entities), the Money Manager will consult with the
Board, the officers of Accessor Funds or the Manager, as the case may be, with
respect to any decision made by it with respect to the investments of the
Account. The Manager shall facilitate the delivery to Money Manager on a
day-to-day basis of all information that the Money Manager reasonably requests
regarding the Fund to enable the Money Manager to meet its obligations under
this Section of the Agreement.
4. Investment Objectives, Policies and Restrictions. Accessor Funds shall
provide the Money Manager with the Fund prospectus, statement of additional
information and policies and procedures of the Fund and any specific investment
restrictions applicable thereto as established by Accessor Funds, including
those set forth in its registration statement as amended from time to time.
Accessor Funds retains the right, on reasonable prior written notice to the
Money Manager from Accessor Funds or the Manager, to modify any such objectives,
policies or restrictions in any manner at any time. The Money Manager shall have
no duty to investigate any instructions received from Accessor Funds, the
Manager, or both, and, absent manifest error, such instructions shall be
presumed reasonable.
5. Transaction Procedures. All transactions will be consummated by payment
to or delivery by Accessor Funds' custodian (the "Custodian"), or such
depositary or agents as may be designated by the Custodian, as custodian for
Accessor Funds, of all cash and/or securities due to or from the Account, and
the Money Manager shall not have possession or custody thereof or any
responsibility or liability with respect thereto. The Money Manager shall advise
the Custodian and the Fund Accounting Agent in writing or by electronic
transmission or facsimile of all investment orders for the Fund placed by it
with broker/dealers at the time and in the manner and as set forth in Accessor
Funds' operational procedures, as may be amended and communicated to the Money
Manager in writing from time to time. Accessor Funds shall issue to the
Custodian such instructions as may be appropriate in connection with the
settlement of any transaction initiated by the Money Manager. Accessor Funds
shall be responsible for all custodial arrangements and the payment of all
custodial charges and fees and, upon the Money Manager giving proper
instructions to the Custodian, the Money Manager shall have no responsibility or
liability with respect to custodial arrangements or the acts, omissions or other
conduct of the Custodian.
The Money Manager may manage other portfolios and expects that the Fund and
other portfolios it manages will, from time to time, purchase or sell the same
securities. The Money Manager may, to the extent permitted by applicable law or
regulations, aggregate orders for the purchase or sale of securities on behalf
of the Fund with orders on behalf of other portfolios the Money Manager manages.
Securities purchased or proceeds of securities sold through aggregated orders
shall be allocated to the account of each portfolio managed by the Money Manager
that bought or sold such securities at the average execution price. If less than
the total of the aggregated orders is executed, purchased securities or proceeds
shall be allocated among the participating portfolios in a fair and equitable
manner in accordance with the policies established by the Money Manager.
6. Allocation of Brokerage. The Money Manager shall have authority and
discretion to select broker/dealers and to establish brokerage accounts with
such brokers to execute portfolio transactions initiated by the Money Manager,
and for the selection of the markets on/in which the transaction will be
executed; provided, however, that any transactions or dealings with an
affiliated broker/dealer by the Money Manager shall comply with Rule 17e 1 of
the 1940 Act and with the procedures of Accessor Funds and/or the Manager in all
respects.
A. In doing so, the Money Manager's primary objective shall be to
select a broker/dealer that can be expected to obtain best execution for
Accessor Funds. However, this responsibility shall not be deemed to
obligate the Money Manager to solicit competitive bids for each
transaction; and the Money Manager shall have no obligation to seek the
lowest available commission cost to Accessor Funds, so long as the Money
Manager believes in good faith, based upon its knowledge of the
capabilities of the firm selected, that the broker/dealer can be expected
to obtain best execution on a particular transaction and that the
commission cost is reasonable in relation to the total quality and
reliability of the brokerage and research services made available by the
broker/dealer to the Money Manager viewed in terms of either that
particular transaction or of the Money Manager's overall responsibilities
with respect to its clients, including Accessor Funds, as to which the
Money Manager exercises investment discretion, notwithstanding that
Accessor Funds may not be the direct or exclusive beneficiary of any such
services or that another broker/dealer may be willing to charge Accessor
Funds a lower commission on the particular transaction.
B. Accessor Funds agrees that it will provide the Money Manager with a
list of broker/dealers which are "affiliated persons" of Accessor Funds and
its other money managers and Accessor Funds will be solely responsible for
keeping the names on the list current. Upon receipt of such list, the Money
Manager agrees that it will not execute any portfolio transactions with a
broker/dealer on the list that has been identified as an "affiliated
person" (as defined in the 1940 Act) of Accessor Funds or of any money
manager for Accessor Funds except as permitted by the 1940 Act, and the
rules adopted thereunder.
C. As used in this paragraph 6, "brokerage and research services"
shall be those services described in Section 28(e)(3) of the Securities
Exchange Act of 1934, as amended.
7. Transactions with Affiliated Persons of the Funds. The Money Manager is
prohibited from consulting with the money manager of another Accessor Fund or
the money manager of the portion of the Fund not managed by the Money Manager,
if applicable, concerning transactions entered into by the Money Manager (or its
affiliates) in accordance with Rule 17a-10, 17e-1, 12d3-1 and 10f-3 of the 1940
Act. Further, for the purposes of Rule 12d3-1 of the 1940 Act, where the Money
Manager is one of multiple money managers managing a Fund, the Money Manager's
responsibility to providing investment advice is limited to providing investment
advice with respect to the Account.
8. Proxies. Unless the Manager gives written instructions to the contrary,
the Money Manager, or a third party designee subject to the oversight of the
Money Manager, shall research and vote all proxies received in proper form and
in a timely manner with respect to the securities held by the Fund in accordance
with the Money Manager's Proxy Policies and Procedures. The Money Manager, or
the third party designee, shall use its best good faith judgment to vote such
proxies in a manner which best serves the interests of the Fund's shareholders.
The Money Manager has provided to the Fund, a copy of its Proxy Policies and
Procedures. The Money Manager shall provide to the Fund within 45 days after the
twelve month period ending June 30 of each year in an electronic format, the
information required by Item 1 of Form N-PX under the 1940 Act if it casts any
votes by proxy on any securities held by the Fund.
9. Reports to the Money Manager. Accessor Funds and the Manager shall
furnish or otherwise make available to the Money Manager such information
relating to the business affairs of Accessor Funds, including periodic reports
concerning the Fund, as the Money Manager at any time, or from time to time, may
reasonably request in order to discharge its obligations hereunder.
10. Fees for Services. The compensation of the Money Manager for its
services under this Agreement shall be calculated and paid by Accessor Funds in
accordance with Exhibit A attached hereto and incorporated by this reference
herein. The Money Manager acknowledges that any such fee is payable solely out
of assets of the Fund Account.
11. Other Investment Activities of the Money Manager. Accessor Funds
acknowledges that the Money Manager, or one or more of its affiliates, may have
investment responsibilities or render investment advice to, or perform other
investment advisory services for, itself, or other individuals or entities (the
"Affiliated Accounts"). Services to be furnished by the Money Manager under this
Agreement may be furnished through the medium of any of the Money Manager's
partners, officers or employees. Subject to the provisions of paragraph 2
hereof, Accessor Funds agrees that the Money Manager and its affiliates may give
advice, exercise investment responsibility and take other action with respect to
the Affiliated Accounts which may be the same as or differ from the advice given
or the timing or nature of action taken with respect to the Account, provided
that the Money Manager acts in good faith, and provided further that it is the
Money Manager's policy to allocate, within its reasonable discretion, investment
opportunities to the Account over a period of time on a fair and equitable basis
relative to the Affiliated Accounts, taking into account the investment
objectives and policies of the Fund and any specific investment restrictions
applicable thereto. Accessor Funds acknowledges that one or more of the
Affiliated Accounts may at any time hold, acquire, increase, decrease, dispose
of or otherwise deal with positions in investments in which the Account may have
an interest from time to time, whether in transactions which may involve the
Account or otherwise. The Money Manager shall have no obligation to acquire for
the Account a position in any investment which any Affiliated Account may
acquire, and the Fund shall have no first refusal, co-investment or other rights
in respect of any such investment, either for the Account or otherwise.
12. Certificate of Authority. Each of Accessor Funds, the Manager and the
Money Manager shall furnish to the others from time to time certified copies of
the resolutions of its Board of Directors, Board of Trustees, Managing Partner
or executive committee, as the case may be, evidencing the authority of its
officers and employees who are authorized to act on behalf of it.
13. Limitation of Liability. The Money Manager shall not be liable for, and
shall be indemnified by Accessor Funds for any action taken, omitted or suffered
to be taken by it in its reasonable judgment, in good faith and believed by it
to be authorized or within the discretion or rights or powers conferred upon it
by this Agreement, or in accordance with (or in the absence of) specific
directions or instructions from Accessor Funds or the Manager; provided,
however, that such acts or omissions shall not have resulted from the Money
Manager's willful misfeasance, bad faith or gross negligence, violation of
applicable law, or reckless disregard of its duty or of its obligations
hereunder. The rights and obligations that are provided for in this Paragraph 13
shall survive the cancellation, expiration or termination of this Agreement.
14. Confidentiality. Subject to the right of each money manager and
Accessor Funds to comply with applicable law, including any demand or request of
any regulatory or taxing authority having jurisdiction over it, the parties
hereto shall treat as confidential all information pertaining to the Fund and
the actions of each money manager, the Manager and Accessor Funds in respect
thereof, other than any such information which is or hereafter becomes
ascertainable from public or published information or trade sources. The rights
and obligations that are provided for in this Paragraph 14 shall survive the
cancellation, expiration or termination of this Agreement.
15. Use of the Money Manager's Name. Accessor Funds and the Manager agree
to furnish the Money Manager at its principal office prior to use thereof copies
of all prospectuses, proxy statements, reports to stockholders, sales
literature, or other material prepared for distribution to stockholders of
Accessor Funds or the public that refer in any way to the Money Manager, and not
to use such material if the Money Manager reasonably objects in writing within
five business days (or such other time as may be mutually agreed) after receipt
thereof. In the event of termination of this Agreement, Accessor Funds and the
Manager will continue to furnish to the Money Manager copies of any of the
above-mentioned materials that refer in any way to the Money Manager, and will
not use such material if the Money Manager reasonably objects in writing within
five business days (or such other time as may be mutually agreed) after receipt
thereof.
16. Assignment. No assignment, as that term is defined in Section 2(a)(4)
of the 1940 Act, of this Agreement shall be made by the Manager or the Money
Manager, and this Agreement shall terminate automatically in the event that it
is assigned. The Money Manager shall notify the Manager and Accessor Funds in
writing sufficiently in advance of any proposed change of control, as defined in
Section 2(a)(9) of the 1940 Act, to enable the Manager and Accessor Funds to
consider whether an assignment, as that term is defined in Section 2(a)(4) of
the 1940 Act, will occur, and to take the steps necessary to enter into a new
money manager agreement with the Money Manager, if desired.
17. Representations, Warranties and Agreements of the Investment Company.
Accessor Funds represents, warrants and agrees that:
A. The Money Manager has been duly appointed by the Board to provide
investment services to the Account as contemplated hereby. Accessor Funds
will deliver certified resolutions of its Board authorizing the appointment
of the Money Manager with respect to the Fund, and approving the form of
this Agreement.
B. Accessor Funds will deliver to the Money Manager a true and
complete copy of its current prospectuses and Statement of Additional
Information as effective from time to time and will deliver all future
amendments and supplements, if any, the registration statement under the
1940 Act and the Securities Act of 1933, as amended, on Form N-1A (the
"Registration Statement"), as filed with the Securities and Exchange
Commission relating to the Fund and shares of the Fund's beneficial shares,
and all amendments thereto, the By-Laws of Accessor Funds in effect on the
date of this Agreement and as amended from time to time, such other
documents or instruments governing the investments of Fund, and such other
information as is necessary for the Money Manager to carry out its
obligations under this Agreement.
C. The organization of Accessor Funds and the conduct of the business
of the Fund as contemplated by this Agreement, materially complies, and
shall at all times materially comply, with the requirements imposed upon
Accessor Funds by applicable law.
D. The Fund is either (i) excluded from the definition of the term
"pool" under Section 4.5 of the General Regulations under the Commodity
Exchange Act ("Rule 4.5"), or (ii) a qualifying entity under Rule 4.5(b)
for which a notice of eligibility has been filed.
18. Representations, Warranties and Agreements of Manager. Manager
represents, warrants and agrees that:
A. The Manager acts as an "investment adviser," as that term is
defined in Section 2(a)(20) of the 1940 Act, pursuant to a Management
Agreement with Accessor Funds.
B. The appointment of the Money Manager by the Manager to provide the
investment services as contemplated hereby has been approved by the Board.
C. The Manager is registered as an "investment adviser" under the
Advisers Act.
19. Representations, Warranties and Agreements of Money Manager. The Money
Manager represents, warrants and agrees that:
A. The Money Manager is registered as an "investment adviser" under
the Advisers Act.
B. The Money Manager will maintain, keep current and preserve on
behalf of Accessor Funds, the records required to be maintained pursuant to
Section 3 of this Agreement and shall timely furnish to the Manager all
information relating to the Money Manager's services under this Agreement
needed by the Manager to keep the other books and records of the Fund
required by the 1940 Act, and the Advisers Act, or any rule or regulation
thereunder and Accessor Funds' policies and procedures (as may be amended
in writing from time to time), in the manner required by such rule,
regulation, policy or procedure. The Money Manager agrees that such records
are the property of Accessor Funds and will be surrendered to Accessor
Funds promptly upon request. The Money Manager may retain copies of any
records surrendered to the Accessor Funds.
C. The Money Manager will adopt or has adopted a written code of
ethics complying with the requirements of Rule 17j-1 under the 1940 Act,
will provide to Accessor Funds a copy of the code of ethics and evidence of
its adoption, and will make such reports to Accessor Funds as required by
Rule 17j-1 under the 1940 Act. The Money Manager has policies and
procedures which it reasonably believes are sufficient to enable the Money
Manager to detect and prevent the misuse of material, nonpublic information
by the Money Manager or any person associated with the Money Manager, in
compliance with the Xxxxxxx Xxxxxxx and Securities Fraud Enforcement Act of
1988.
D. The Money Manager will notify Accessor Funds of any material
changes in the membership of its partnership, including but not limited to
any changes in the managing partners or in the partners who manage the
Fund, or in the case of a corporation in the ownership of more than five
percent of its voting securities, within a reasonable time after such
change.
X. The Money Manager understands that it may receive certain
non-public information about clients of the Manager and Accessor Funds
under Section 248.14 of Regulation S-P and understands and agrees that it
will disclose that information only as permitted by Section 248.11 of
Regulation S-P.
F. The Money Manager represents and acknowledges that it is not
authorized to render and will not provide legal advice under this Agreement
including relating to any securities purchased on behalf of the Fund which
may become subject to any legal proceedings including, but not limited to,
bankruptcies, class action lawsuits or responding to proof of claim
notifications.
G. The Money Manager represents that it has delivered and the Manager
acknowledges receipt, at least 48 hours prior to entering into this
Agreement, of a copy of Part II of the Money Manager's Form ADV containing
certain information concerning the Money Manager and the nature of its
business.
20. Amendment. This Agreement may be amended at any time, but only by
written agreement among the Money Manager, the Manager and the Fund, which
amendment must be approved by the Board in the manner required by the 1940 Act.
21. Effective Date; Term. This Agreement shall become effective for the
Fund on the effective date set forth on page 1 of this Agreement, and shall
continue in effect until the termination date set forth on page 1 of this
Agreement. Thereafter, the Agreement shall continue in effect for successive
annual periods only so long as its continuance has been specifically approved at
least annually (a) by a vote of a majority of the Board or (b) by a vote of a
majority of the outstanding voting securities (as defined in the 1940 Act) of
the Fund for which the Money Manager acts as money manager, and in either case
by a majority of the directors who are not parties to the Agreement or
interested persons of any parties to the Agreement (other than as directors of
Accessor Funds) cast in person at a meeting called for purposes of voting on the
Agreement.
22. Termination. This Agreement may be terminated, without the payment of
any penalty, by the Board, the Manager, the Money Manager or by the vote of a
majority of the outstanding voting securities (as that term is defined in the
1940 Act) of the Fund for which the Money Manager acts as money manager, upon at
least 60 days' prior written notice to the other parties hereto. Any such
termination shall not affect the status, obligations or liabilities of any party
hereto to any of the other parties that accrued prior to such termination.
23. Applicable Law. To the extent that state law shall not have been
preempted by the provisions of any laws of the United States heretofore or
hereafter enacted, as the same may be amended from time to time, this Agreement
shall be administered, construed and enforced according to the laws of the State
of Washington. Should any part of this Agreement be held invalid by a court
decision, statute, rule or otherwise, the remainder of this Agreement shall not
be affected thereby. This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors. Where the effect
of a requirement of the 1940 Act or Advisers Act reflected in any provision of
this Agreement is altered by a rule, regulation or order of the Commission,
whether of special or general application, such provision shall be deemed to
incorporate the effect of such rule, regulation or order.
24. Notices. Any notice, advice, or report to be given pursuant to this
Agreement shall be delivered or mailed:
To the Manager at: Accessor Capital Management LP
0000 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Xxxxxxxxx Xxxxxxxxx
To Accessor Funds at: Accessor Funds, Inc.
0000 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Xxxxxxxxx Xxxxxxxxx
To the Money Manager at: SSgA Funds Management, Inc.
Xxx Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Chief Compliance Officer
25. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but such
counterparts shall, together, constitute only one instrument.
ACCESSOR FUNDS, INC. Accepted and agreed to:
SSgA FUNDS MANAGEMENT, INC.
BY:___________________________ BY:___________________________
Xxxxxxxxx X. Xxxxxxxxx Name: Xxxxx Xxxx
Secretary Title: President
DATE:_________________________ DATE:_________________________
ACCESSOR CAPITAL MANAGEMENT LP
By Accessor Capital Corporation, Inc.
Its Managing General Partner
BY:_________________________
X. Xxxxxxx Xxxxxxx, III
President
DATE:______________________
EXHIBIT A
Schedule dated
May 1, 2007
to the Money Manager Agreement
between and among
Accessor Funds, Inc., Accessor Capital Management LP
and SSgA Funds Management, Inc.
The management fee with respect to the Small to Mid Cap Fund (the "Fund") is
comprised of a monthly base fee (the "Base Fee") payable by the Fund to SSgA
Funds Management, Inc. (the "Money Manager") at an annual rate of 30 basis
points (0.30%) of the Fund's average daily net assets over such month and a
performance fee adjustment (the "Performance Fee Adjustment") as discussed
below.
A. Calculating the Performance Fee Adjustment.
The Performance Fee Adjustment shall be calculated monthly by:
(i) Determining the difference in performance (the "Performance
Difference") between the Fund and the Dow Xxxxx Wilshire 4500 Index
(the "Index"), as described in paragraph B;
(ii) Using the Performance Difference to determine the performance
adjustment rate (the "Performance Adjustment Rate"), as illustrated in
paragraph C; and
(iii) Applying the Performance Fee Adjustment Rate to the average daily
net assets of the Fund during the Performance Measurement Period (as
defined below).
B. Computing the Performance Difference.
The Performance Difference is calculated monthly, and is determined by measuring
the percentage difference between the performance of one Advisor Class Share of
the Fund and the performance of the Index over the performance measurement
period as defined below (the "Performance Measurement Period"). The performance
of one Advisor Class Share of the Fund shall be measured by computing the
percentage difference, carried to five decimal places, between the net asset
value as of the last business day of the period selected for comparison and the
net asset value of such share as of the last business day of the prior period,
adjusted for dividends or capital gain distributions treated as reinvested
immediately. The performance of the Index will be established by measuring the
percentage difference, carried to five decimal places, between the beginning and
ending values of the Index for the comparison period, with dividends or capital
gain distributions on the securities that comprise the Index being treated as
reinvested immediately.
C. Determining the Performance Adjustment Rate
The Performance Adjustment Rate will increase or decrease proportionately with
the Performance Difference. To the extent that the Performance Difference falls
within a "null zone" that is equal to plus 125 basis points (1.25%) or minus 125
basis points (-1.25%), the Performance Fee Adjustment Rate shall be zero and
there shall be no Performance Fee Adjustment. The Performance Fee Adjustment
Rate shall not exceed an absolute value of 20 basis points (0.20%) (the "Maximum
Performance Fee Adjustment Rate") and the Maximum Performance Fee Adjustment
Rate shall be made when the Performance Difference reaches plus or minus 350
basis points (3.50%). Therefore, the minimum possible annual fee payable to the
Money Manager will be 10 basis points (0.10%) and the maximum possible annual
fee will be 50 basis points (0.50%).
D. Performance Measurement Periods
For the period from May 1, 2007 through April 30, 2008, the Money Manager will
be paid at the Base Rate, without regard to any Performance Adjustment.
Thereafter, the Performance Measurement Period shall equal the 12-month period
prior to and including the month for which the fee is being calculated. The
12-month comparison period will roll over with each succeeding month, so that it
will always equal 12 months, ending with the month for which the performance
incentive adjustment is being computed.
E. Changes to the "Index" or the "Class"
The Directors of the Fund have initially designated the Index and the Advisor
Class Shares of the Fund (the "Class") as the Index and Class to be used for
purposes of determining the Performance Adjustment. From time to time, to the
extent permitted by the Investment Company Act of 1940, as amended (the "1940
Act") and the rules and regulations thereunder, the Directors may, by a vote of
the Directors voting in person, including a majority of the Directors who are
not parties to this Agreement or "interested persons" (as defined in the 1940
Act) of any such parties, determine (i) that another securities index is a more
appropriate benchmark than the Index for purposes of evaluating the performance
of the Fund; and/or (ii) that a different class of shares of the Fund other than
the Class is most appropriate for use in calculating the Performance Adjustment.
After ten days' written notice to the Money Manager, a different index (the
"Successor Index") may be substituted for the Index in prospectively calculating
the Performance Adjustment, and/or a different class of shares (the "Successor
Class") may be substituted in calculating the Performance Adjustment. However,
the calculation of that portion of the Performance Adjustment attributable to
any portion of the Performance Measurement Period prior to the adoption of the
Successor Index will still be based upon the Performance Difference. The use of
a Successor Class of shares for purposes of calculating the Performance
Adjustment shall apply to the entire Performance Measurement Period so long as
such Successor Class was outstanding at the beginning of such period. In the
event that such Successor Class of shares was not outstanding for all or a
portion of the Performance Measurement Period, it may only be used in
calculating that portion of the Performance Adjustment attributable to the
period during which such Successor Class was outstanding and any prior portion
of the Performance Measurement Period shall be calculated using the Class of
shares previously designated.
