Exhibit 5(a)
INVESTMENT ADVISORY AGREEMENT
AGREEMENT, made this 2nd day of July, 1998, between The Munder Funds, Inc.
(the "Company") on behalf of each Fund (collectively, the "Funds") set forth on
Schedule A attached hereto, and Munder Capital Management (the "Advisor"), a
Delaware partnership.
WHEREAS, the Company is a Maryland corporation authorized to issue shares
in series and is registered as an open-end management investment company under
the Investment Company Act of 1940, as amended (the "1940 Act"), and each Fund
is a series of the Company;
WHEREAS, the Advisor is registered as an investment advisor under the
Investment Advisers Act of 1940, as amended (the "Advisers Act"); and
WHEREAS, the Company wishes to retain the Advisor to render investment
advisory services to the Funds, and the Advisor is willing to furnish such
services to the Funds;
NOW, THEREFORE, in consideration of the promises and mutual covenants
herein contained, it is agreed between the Company and the Advisor as follows:
1. APPOINTMENT
(a) The Company hereby appoints the Advisor to act as investment advisor to
the Funds for the periods and on the terms set forth herein. The Advisor
accepts the appointment and agrees to furnish the services set forth herein for
the compensation provided herein.
(b) In the event that the Company establishes one or more portfolios other
than the Funds listed on Schedule A attached hereto, with respect to which it
desires to retain the Investment Advisor to act as investment advisor hereunder,
it shall notify the Investment Advisor in writing. If the Investment Advisor is
willing to render such services under this Agreement it shall notify the Company
in writing whereupon such portfolio shall become a Fund hereunder and shall be
subject to the provisions of this Agreement to the same extent as the Funds
named above except to the extent that said provisions (including those relating
to the compensation payable by the Fund to the Investment Advisor) are modified
with respect to such Fund in writing by the Company and the Investment Advisor
at the that time.
2. SERVICES AS INVESTMENT ADVISOR
Subject to the general supervision and direction of the Board of Directors
of the Company, the Advisor will (a) manage the Funds in accordance with each
Fund's investment objective and policies as stated in the Fund's Prospectus and
the Statement of Additional Information filed with the Securities and Exchange
Commission, as they may be amended from time to time; (b) make investment
decisions for the Funds; (c) place purchase and sale orders on behalf of the
Funds; and (d) employ professional portfolio managers and securities analysts to
provide research services to the Funds. In providing those services, the
Advisor will provide the Funds with ongoing research, analysis, advice and
judgments regarding individual investments, general economic conditions and
trends and long-range investment
policy. In addition, the Advisor will furnish the Funds with whatever
statistical information the Funds may reasonably request with respect to the
securities that the Funds may hold or contemplate purchasing.
The Advisor further agrees that, in performing its duties hereunder, it
will:
(a) comply with the 1940 Act and all rules and regulations thereunder and
under the Advisers Act, the Internal Revenue Code of 1986, as amended (the
"Code"), and all other applicable federal and state law and regulations, and
with any applicable procedures adopted by the Directors;
(b) use reasonable efforts to manage each Fund so that it will qualify, and
continue to qualify, as a regulated investment company under Subchapter M of the
Code and regulations issued thereunder;
(c) maintain books and records with respect to each Fund's securities
transactions, render to the Board of Directors of the Company such periodic and
special reports as the Board may reasonably request, and keep the Directors
informed of developments materially affecting each Fund's portfolio;
(d) make available to the Funds' administrator and the Company, promptly
upon their request, such copies of its investment records and ledgers with
respect to the Funds as may be required to assist the administrator and the
Company in their compliance with applicable laws and regulations. The Advisor
will furnish the Directors with such periodic and special reports regarding the
Funds as they may reasonably request; and
(e) immediately notify the Company in the event that the Advisor or any of
its affiliates: (1) becomes aware that it is subject to a statutory
disqualification that prevents the Advisor from serving as investment advisor
pursuant to this Agreement; or (2) becomes aware that it is the subject of an
administrative proceeding or enforcement action by the Securities and Exchange
Commission or other regulatory authority. The Advisor further agrees to notify
the Company immediately of any material fact known to the Advisor respecting or
relating to the Advisor that is not contained in the Company's Registration
Statement regarding the Funds, or any amendment or supplement thereto, but that
is required to be disclosed therein, and of any statement contained therein that
becomes untrue in any material respect.
3. DOCUMENTS
The Company has delivered properly certified or authenticated copies of
each of the following documents to the Advisor and will deliver to it all future
amendments and supplements thereto, if any:
(a) certified resolution of the Board of Directors of the Company
authorizing the appointment of the Advisor and approving the form of this
Agreement;
(b) the Registration Statement as filed with the Securities and Exchange
Commission and any amendments thereto; and
(c) exhibits, powers of attorneys, certificates and any and all other
documents relating to or filed in connection with the Registration Statement
described above.
4. BROKERAGE
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In selecting brokers or dealers to execute transactions on behalf of the
Funds, the Advisor will use its best efforts to seek the best overall terms
available. In assessing the best overall terms available for any Fund
transaction, the Advisor will consider all factors it deems relevant, including,
but not limited to, the breadth of the market in the security, the price of the
security, the financial condition and execution capability of the broker or
dealer and the reasonableness of the commission, if any, for the specific
transaction and on a continuing basis. In selecting brokers or dealers to
execute a particular transaction, and in evaluating the best overall terms
available, the Advisor is authorized to consider the brokerage and research
services (as those terms are defined in Section 28(e) of the Securities Exchange
Act of 1934, as amended (the "1934 Act")) provided to the Funds and/or other
accounts over which the Advisor or its affiliates exercise investment
discretion. The parties hereto acknowledge that it is desirable for the Trust
that the Advisor have access to supplemental investment and market research and
security and economic analysis provided by brokers-dealers who may execute
brokerage transactions at a higher cost to the Trust than may result when
allocating brokerage to other brokers on the basis of seeking the most favorable
price and efficient execution. Therefore, the Advisor may cause the Fund to pay
a broker-dealer which furnishes brokerage and research services a higher
commission than that which might be charged by another broker-dealer for
effecting the same transaction, provided that the Advisor determines in good
faith that such commission is reasonable in relation the value of the brokerage
and research services provided by such broker-dealer, viewed in terms of either
the particular transaction or the overall responsibilities of the Advisor to the
Fund. It is understood that the services provided by such brokers may be useful
to the Advisor in connection with the Advisor's services to other clients. In
accordance with Section 11(a) of the 1934 Act and Rule 11a2-2(T) thereunder and
subject to any other applicable laws and regulations, the Advisor and its
affiliates are authorized to effect portfolio transactions for the Funds and to
retain brokerage commissions on such transactions.
5. RECORDS
The Advisor agrees to maintain and to preserve for the periods prescribed
under the 1940 Act any such records as are required to be maintained by the
Advisor with respect to the Funds by the 1940 Act. The Advisor further agrees
that all records which it maintains for the Funds are the property of the Funds
and it will promptly surrender any of such records upon request.
6. STANDARD OF CARE
The Advisor shall exercise its best judgment in rendering the services
under this Agreement. The Advisor shall not be liable for any error of judgment
or mistake of law or for any loss suffered by a Fund or the Funds' shareholders
in connection with the matters to which this Agreement relates, provided that
nothing herein shall be deemed to protect or purport to protect the Advisor
against any liability to a Fund or to its shareholders to which the Advisor
would otherwise be subject by reason of willful misfeasance, bad faith or gross
negligence on its part in the performance of its duties or by reason of the
Advisor's reckless disregard of its obligations and duties under this Agreement.
As used in this Section 6, the term "Advisor" shall include any officers,
directors, employees, or other affiliates of the Advisor performing services
with respect to a Fund.
7. COMPENSATION
In consideration of the services rendered pursuant to this Agreement, each
Fund will pay the Advisor a fee as set forth on Schedule B attached hereto.
This fee shall be computed and accrued daily and payable monthly; however, with
respect to any Fund for which the effective date of this Agreement is prior to
November 30, 1998, the fee shall be maintained in an interest-bearing escrow
account until
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such time as shareholders of the Fund approve the payment of fees pursuant to
this agreement. If shareholders do not approve such payment of fees on or before
November 30, 1998, the balance in the escrow account shall be paid to the Fund.
For the purpose of determining fees payable to the Advisor, the value of a
Fund's average daily net assets shall be computed at the times and in the manner
specified in the Fund's Prospectus or Statement of Additional Information.
8. EXPENSES
The Advisor will bear all expenses in connection with the performance of
its services under this Agreement. Each Fund will bear certain other expenses
to be incurred in its operation, including: taxes, interest, brokerage fees and
commissions, if any, fees of Directors of the Company who are not officers,
directors or employees of the Advisor, Securities and Exchange Commission fees
and state blue sky fees; charges of custodians and transfer and dividend
disbursing agents; the Fund's proportionate share of insurance premiums; outside
auditing and legal expenses; costs of maintenance of the Fund's existence; costs
attributable to investor services, including, without limitation, telephone and
personal expenses; charges of an independent pricing service, costs of preparing
and printing prospectuses and statements of additional information for
regulatory purposes and for distribution to existing shareholders; costs of
shareholders' reports and meetings of the shareholders of the Fund and of the
officers of Board of Directors of the Company; and any extraordinary expenses.
9. SERVICES TO OTHER COMPANIES OR ACCOUNTS
The investment advisory services of the Advisor to the Funds under this
Agreement are not to be deemed exclusive, and the Advisor, or any affiliate
thereof, shall be free to render similar services to other investment companies
and clients (whether or not their investment objective and policies are similar
those of a Fund) and to engage in activities so long as its services hereunder
are not impaired thereby.
10. DURATION AND TERMINATION
This Agreement shall become effective on the date of this Agreement
provided that with respect to any Fund, this Agreement shall not take effect
unless it has been approved (a) by a vote of a majority of the Board of
Directors of the Company, including a majority of those Directors who are not
"interested persons" (as defined in the 0000 Xxx) of any party to this Agreement
cast in person at a meeting called for the purpose of voting such approval, and
(b) by vote of a majority of that Fund's outstanding voting securities and shall
continue in effect with respect to the Fund, unless sooner terminated as
provided herein, for two years from such date and shall continue from year to
year thereafter, provided each continuance is specifically approved at least
annually by (i) the vote of a majority of the Board of Directors of the Company
or (ii) a vote of a "majority" (as defined in the 0000 Xxx) of the Fund's
outstanding voting securities, provided that in either event the continuance is
also approved by a majority of the Board of Directors who are not "interested
persons" (as defined in the 0000 Xxx) of any party to this Agreement, by vote
cast in person at a meeting called for the purpose of voting on such approval.
This Agreement is terminable with respect to the Funds, or any Fund, without
penalty, on sixty (60) days' written notice by the Board of Directors of the
Company or by vote of the holders of a "majority" (as defined in the 0000 Xxx)
of the shares of the affected Funds or upon ninety (90) days' written notice by
the Advisor. Termination of this Agreement with respect to any given Fund,
shall in no way affect the continued validity of this Agreement or the
performance thereunder with respect to any other Fund. This Agreement will be
terminated automatically in the event of its "assignment" (as defined in the
1940 Act).
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11. AMENDMENT
No provision of this Agreement shall be changed, waived or 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 with respect to any Fund shall be
effective until approved by an affirmative vote of (i) a majority of the
outstanding voting securities of that Fund, and (ii) a majority of the Directors
of the Company, including a majority of Directors who are not "interested
persons" (as defined in the 0000 Xxx) of any party to this Agreement, cast in
person at a meeting called for the purpose of voting on such approval, if such
approval is required by applicable law.
12. USE OF NAME
It is understood that the name of Munder Capital Management or any
derivative thereof or logo associated with that name is the valuable property of
the Advisor and its affiliates, and that the Company and each Fund have the
right to use such name (or derivable or logo) only so long as this Agreement
shall continue with respect to a given Fund. Upon termination of this Agreement
or upon termination of this Agreement with respect to a given Fund, the Company
and any Fund affected shall forthwith cease to use such name (or derivable or
logo) and the Company shall promptly amend its Articles of Incorporation to
change the Fund name to comply herewith.
13. MISCELLANEOUS
(a) This Agreement constitutes the full and complete agreement of the
parties hereto with respect to the subject matter hereof.
(b) Titles or captions of sections in this Agreement are inserted only as a
matter of convenience and for reference, and in no way define, limit, extend or
describe the scope of this Agreement or the intent of any provisions thereof.
(c) This Agreement may be executed in several counterparts, all of which
together shall for all purposes constitute one Agreement, binding on all the
parties.
(d) This Agreement and the rights and obligations of the parties hereunder
shall be governed by, and interpreted, construed and enforced in accordance with
the laws of the State of Michigan.
(e) If any provisions of this Agreement or the application thereof to any
party or circumstances shall be determined by any court of competent
jurisdiction to be invalid or unenforceable to any extent, the remainder of this
Agreement or the application of such provision to such person circumstance,
other than these as to which it so determined to be invalid or unenforceable,
shall not be affected thereby, and each provision hereof shall be valid and
shall be enforced to the fullest extent permitted by law.
(f) Notices of any kind to be given to the Advisor by the Company shall be
in writing and shall be duly given if mailed or delivered to the Advisor at 000
Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000, or at such other address or to such
individual as shall be specified by the Advisor to the Company. Notices of any
kind to be given to the Company by the Advisor shall be in writing and shall be
duly given if mailed or delivered to 000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx
00000, or at such the address to such individual as shall be specified by the
Company to the Advisor.
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IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed by their officers designated below on the day and year first above
written.
THE MUNDER FUNDS, INC.
By: /s/ Xxxx Xxxx Xxxxx
-------------------
Xxxx Xxxx Xxxxx
MUNDER CAPITAL MANAGEMENT
By: /s/ Xxxxx X. Xxxxxxx
-------------------
Xxxxx X. Xxxxxxx
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SCHEDULE A
Munder All-Season Aggressive Fund
Munder All-Season Conservative Fund
Munder All-Season Moderate Fund
Munder Equity Selection Fund
Munder Financial Services Fund
Munder Growth Opportunities Fund
Munder International Bond Fund
Munder Micro-Cap Equity Fund
Munder Mid-Cap Growth Fund
Munder Money Market Fund
Munder Multi-Season Growth Fund
Munder NetNet Fund
Munder Real Estate Equity Investment Fund
Munder Short Term Treasury Fund
Munder Small-Cap Value Fund
Munder Value Fund
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SCHEDULE B
FUND ANNUAL FEES (AS A PERCENTAGE OF
AVERAGE DAILY NET ASSETS)
Munder All-Season Aggressive Fund 0.35%
Munder All-Season Conservative Fund 0.35%
Munder All-Season Moderate Fund 0.35%
Munder Convertible Securities Fund 0.75%
Munder Equity Selection Fund 0.75%
Munder Financial Services Fund 0.75%
Munder Growth Opportunities Fund 0.75%
Munder International Bond Fund 0.50%
Munder Micro-Cap Equity Fund 1.00%
Munder Mid-Cap Growth Fund 0.75%
Munder Money Market Fund 0.40%
Munder Multi-Season Growth Fund 1.00% of up to $500 million then
reduced to 0.75% of the Funds average
daily net assets in excess of
$500 million
Munder NetNet Fund 1.00%
Munder Real Estate Equity Investment Fund 0.74%
Munder Short Term Treasury Fund 0.25%
Munder Small-Cap Value Fund 0.75%
Munder Value Fund 0.75%
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