PRINCIPAL INVESTORS FUND, INC.
AMENDED AND RESTATED
MANAGEMENT AGREEMENT
AGREEMENT to be effective June 14, 2004, by and between PRINCIPAL
INVESTORS FUND, INC., a Maryland corporation (hereinafter called the "Fund") and
PRINCIPAL MANAGEMENT CORPORATION, an Iowa corporation (hereinafter called the
"Manager").
W I T N E S S E T H:
WHEREAS, The Fund has furnished the Manager with copies properly
certified or authenticated of each of the following:
(a) Articles of Incorporation of the Fund;
(b) Bylaws of the Fund as adopted by the Board of Directors; and
(c) Resolutions of the Board of Directors of the Fund selecting the
Manager as investment adviser and approving the form of this
Agreement.
NOW THEREFORE, in consideration of the premises and mutual agreements
herein contained, the Fund hereby appoints the Manager to act as investment
adviser and manager of the Fund, and the Manager agrees to act, perform or
assume the responsibility therefore in the manner and subject to the conditions
hereinafter set forth. The Fund will furnish the Manager from time to time with
copies, properly certified or authenticated, of all amendments of or supplements
to the foregoing, if any.
1. INVESTMENT ADVISORY SERVICES
The Manager will regularly perform the following services for the Fund:
(a) Provide investment research, advice and supervision;
(b) Provide investment advisory, research and statistical facilities
and all clerical services relating to research, statistical and
investment work;
(c) Furnish to the Board of Directors of the Fund (or any appropriate
committee of such Board), and revise from time to time as
conditions require, a recommended investment program for the
portfolio of each Series of the Fund consistent with each Series'
investment objective and policies;
(d) Implement such of its recommended investment program as the Fund
shall approve, by placing orders for the purchase and sale of
securities, subject always to the provisions of the Fund's
Articles of Incorporation and Bylaws and the requirements of the
Investment Company Act of 1940 (the "1940 Act"), and the Fund's
Registration Statement, current Prospectus and Statement of
Additional Information, as each of the same shall be from time to
time in effect;
(e) Advise and assist the officers of the Fund in taking such steps
as are necessary or appropriate to carry out the decisions of its
Board of Directors and any appropriate committees of such Board
regarding the general conduct of the investment business of the
Fund; and
(f) Report to the Board of Directors of the Fund at such times and in
such detail as the Board may deem appropriate in order to enable
it to determine that the investment policies of the Fund are
being observed.
2. CORPORATE ADMINISTRATIVE SERVICES
The Manager will provide the following corporate administrative services
for the Fund:
(a) furnish the services of such of the Manager's officers and
employees as may be elected officers or directors of the Fund,
subject to their individual consent to serve and to any
limitations imposed by law;
(b) furnish office space, and all necessary office facilities and
equipment, for the general corporate functions of the Fund (i.e.,
functions other than (i) underwriting and distribution of Fund
shares; (ii) custody of Fund assets, (iii) transfer and paying
agency services; and (iv) corporate and portfolio accounting
services); and
(c) furnish the services of executive and clerical personnel
necessary to perform the general corporate functions of the Fund.
3. RESERVED RIGHT TO DELEGATE DUTIES AND SERVICES TO OTHERS
The Manager in assuming responsibility for the various services as set
forth in this Agreement reserves the right to enter into agreements with others
for the performance of certain duties and services or to delegate the
performance of some or all of such duties and services to Principal Life
Insurance Company, or one or more affiliates thereof; provided, however, that
entry into any such agreements shall not relieve the Manager of its duty to
review and monitor the performance of such persons to the extent provided in the
agreements with such persons or as determined from time to time by the Board of
Directors.
4. EXPENSES BORNE BY THE MANAGER
The Manager will pay:
(a) the organizational expenses of the Fund and its portfolios and
share classes, including the Fund's registration under the
Investment Company Act of 1940, and the initial registration of
its Capital Stock for sale under the Securities Act of 1933 with
the Securities and Exchange Commission;
(b) Compensation of personnel, officers and directors who are also
affiliated with the Manager; and
(c) Expenses and compensation associated with furnishing office space,
and all necessary office facilities and equipment, and personnel
necessary to perform the general corporate functions of the Fund.
5. COMPENSATION OF THE MANAGER BY FUND
For all services to be rendered and payments made as provided in
Sections 1, 2 and 4 hereof, the Fund will accrue daily and pay the Manager
monthly, or at such other intervals as the Fund and Manager may agree, a fee
based on the average of the values placed on the net assets of each Series of
the Fund as of the time of determination of the net asset value on each trading
day throughout the month in accordance with Schedule 1 attached hereto.
Net asset value shall be determined pursuant to applicable provisions of
the Articles of Incorporation of the Fund. If pursuant to such provisions the
determination of net asset value is suspended, then for the purposes of this
Section 5 the value of the net assets of the Fund as last determined shall be
deemed to be the value of the net assets for each day the suspension continues.
The Manager may, at its option, waive all or part of its compensation
for such period of time as it deems necessary or appropriate.
6. EXPENSES BORNE BY FUND
The Fund will pay, without reimbursement by the Manager, all expenses
attributable to the services described in this Agreement and not specifically
identified in this Agreement as being paid by the Manager.
7. AVOIDANCE OF INCONSISTENT POSITION
In connection with purchases or sales of portfolio securities for the
account of the Fund, neither the Manager nor any of the Manager's directors,
officers or employees will act as a principal or agent or receive any
commission.
8. LIMITATION OF LIABILITY OF THE MANAGER
The Manager shall not be liable for any error of judgment or mistake of
law or for any loss suffered by the Fund in connection with the matters to which
this Agreement relates, except a loss resulting from willful misfeasance, bad
faith or gross negligence on the Manager's part in the performance of its duties
or from reckless disregard by it of its obligations and duties under this
Agreement.
9. COPIES OF CORPORATE DOCUMENTS
The Fund will furnish the Manager promptly with properly certified or
authenticated copies of amendments or supplements to its Articles of
Incorporation or Bylaws. Also, the Fund will furnish the Manager financial and
other corporate information as needed, and otherwise cooperate fully with the
Manager in its efforts to carry out its duties and responsibilities under this
Agreement.
10. DURATION AND TERMINATION OF THIS AGREEMENT
This Agreement shall remain in force until the conclusion of the first
meeting of the shareholders of the Fund following the execution of this
agreement and if it is approved by a vote of a majority of the outstanding
voting securities of the Fund it shall continue in effect thereafter from year
to year provided that the continuance is specifically approved at least annually
either by the Board of Directors of the Fund or by a vote of a majority of the
outstanding voting securities of the Series and in either event by vote of a
majority of the directors of the Fund who are not interested persons of the
Manager, Principal Life Insurance Company, or the Fund cast in person at a
meeting called for the purpose of voting on such approval. This Agreement may,
on sixty days written notice, be terminated at any time without the payment of
any penalty, by the Board of Directors of the Fund, by vote of a majority of the
outstanding voting securities of the Series, or by the Manager. This Agreement
shall automatically terminate in the event of its assignment. In interpreting
the provisions of this Section 10, the definitions contained in Section 2(a) of
the Investment Company Act of 1940 (particularly the definitions of "interested
person," "assignment" and "voting security") shall be applied.
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, and no amendment of this Agreement shall be effective until approved by
vote of the holders of a majority of the outstanding voting securities of the
Series to which such amendment relates and by vote of a majority of the
directors who are not interested persons of the Manager, Principal Life
Insurance Company or the Fund cast in person at a meeting called for the purpose
of voting on such approval.
12. ADDRESS FOR PURPOSE OF NOTICE
Any notice under this Agreement shall be in writing, addressed and
delivered or mailed, postage prepaid, to the other party at such address as such
other party may designate for the receipt of such notices. Until further notice
to the other party, it is agreed that the address of the Fund and that of the
Manager for this purpose shall be the Principal Financial Group, Xxx Xxxxxx,
Xxxx 00000-0000.
13. MISCELLANEOUS
The captions in this Agreement are included for convenience of reference
only, and in no way define or delimit any of the provisions hereof or otherwise
affect their construction or effect. This Agreement may be executed
simultaneously in two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized.
PRINCIPAL INVESTORS FUND, INC.
/s/Xxxxx X. Xxxxxx
By _____________________________________________
Xxxxx X. Xxxxxx, President and Chief Executive Officer
PRINCIPAL MANAGEMENT CORPORATION
/s/A. S. Filean
By _____________________________________________
Xxxxxx X. Xxxxxx, Senior Vice President
SCHEDULE 1
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
Management Fee Management Fee
Series as a Percentage Series as a Percentage
at Daily Average Net at Daily Average
Assets Net Assets
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
Bond and Mortgage Securities Fund 0.55% Partners LargeCap Blend Fund 0.75%
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
Capital Preservation Fund 0.52% Partners LargeCap Blend Fund I 0.45%
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
Government Securities Fund 0.40% Partners LargeCap Growth Fund 1.00%
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
High Quality Intermediate-Term Bond Fund 0.40% Partners LargeCap Growth Fund I 0.75%
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
High Quality Long-Term Bond Fund 0.40% Partners LargeCap Growth Fund II 1.00%
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
High Quality Short-Term Bond Fund 0.40% Partners LargeCap Value Fund 0.80%
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
High Yield Fund 0.65% Partners LargeCap Value Fund I 0.80%
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
International Emerging Markets Fund 1.35% Partners LargeCap Value Fund II 0.85%
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
International Fund I 0.90% Partners MidCap Growth Fund 1.00%
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
International Fund II 1.00% Partners MidCap Growth Fund I 1.00%
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
LargeCap Blend Fund I 0.60% Partners MidCap Value 1.00%
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
LargeCap Growth Fund 0.55% Partners MidCap Value Fund I 1.00%
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
LargeCap S&P 500 Index Fund 0.15% Partners SmallCap Blend Fund 1.00%
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
LargeCap Value Fund 0.45% Partners SmallCap Growth Fund I 1.10%
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
LifeTime 2010 Fund 0.1225% Partners SmallCap Growth Fund II 1.00%
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
LifeTime 2020 Fund 0.1225% Partners SmallCap Growth Fund III 1.10%
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
LifeTime 2030 Fund 0.1225% Partners SmallCap Value Fund 1.00%
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
LifeTime 2040 Fund 0.1225% Partners SmallCap Value Fund I 1.00%
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
LifeTime 2050 Fund 0.1225% Partners SmallCap Value Fund II 1.00%
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
LifeTime Strategic Income Fund 0.1225% Preferred Securities Fund 0.75%
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
MidCap Blend Fund 0.65% Real Estate Securities Fund 0.85%
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
MidCap Growth Fund 0.65% SmallCap Blend Fund 0.75%
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
MidCap S&P 400 Index Fund 0.15% SmallCap Growth Fund 0.75%
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
MidCap Value Fund 0.65% SmallCap S&P 600 Index Fund 0.15%
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
Money Market Fund 0.40% SmallCap Value Fund 0.75%
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
-------------------------------------------- ---------------------- ----------------------------------- ---------------------
Partners International Fund 1.10%
-------------------------------------------- ----------------------
-------------------------------------------- ----------------------
