INVESTMENT ADVISORY AGREEMENT
Between
MEEDER PREMIER PORTFOLIOS
And
XXXXXX ASSET MANAGEMENT, INC.
This Agreement is made the 1st day of October, 2003, by and between the
MEEDER PREMIER PORTFOLIOS, a business trust organized and existing under the
laws of the State of Massachusetts (the "Trust"), on behalf of itself and the
Portfolios (as defined below), and XXXXXX ASSET MANAGEMENT, INC., a corporation
organized and existing under the laws of the State of Ohio (the "Adviser").
W I T N E S S E T H :
WHEREAS, the Trust is engaged in business as an open-end management
investment company and maintains the portfolios set forth on Schedule A attached
hereto, as such Schedule may be amended from time to time by agreement of the
Trust and the Adviser (each a "Portfolio" and collectively, the "Portfolios");
WHEREAS, each Portfolio is registered as such under the Investment Company
Act of 1940, as amended (collectively with the rules and regulations promulgated
thereunder the "1940 Act"); and
WHEREAS, the Adviser is engaged principally in the business of rendering
investment and supervisory services and is registered as an investment adviser
under the Investment Advisers Act of 1940, as amended; and
WHEREAS, the Trust desires to retain the Adviser to render investment and
supervisory services to each Portfolio in the manner and on the terms and
conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the premises and the mutual promises
hereinafter set forth, the parties hereto agree as follows:
I
INVESTMENT RESPONSIBILITY
-------------------------
(1) In providing the services and assuming the obligations set forth
herein, the Adviser may, at its expense, employ one or more subadvisers.
References herein to the Adviser shall include any subadviser employed by the
Adviser. Any agreement between the Adviser and
a subadviser shall be subject to the renewal, termination and amendment
provisions of section V hereof.
The Trust hereby retains the Adviser to supervise and assist in the
management of the assets for each Portfolio and to furnish the Portfolios with a
continuous program for the investment of each Portfolio's assets, including:
a. Recommendations as to specific securities to be purchased for or
eliminated from each Portfolio's portfolio, and
b. Recommendations as to the portion of each Portfolio's assets that
should be held uninvested.
(2) Notwithstanding the generality of the foregoing, the Adviser may
itself, and at its own expense, contract for such supplementary advisory and
research services as it deems necessary or desirable to fulfill its obligations
under paragraph (1) above, provided that any such contract shall have been
approved by the Trust and its shareholders to the extent, and in the manner,
required by the 0000 Xxx.
(3) The Adviser shall furnish to the Trust the services of one or more
persons who shall be authorized by the Trust to place orders for the purchase
and sale of securities for the account of each Portfolio. Acting through a
person so authorized by the Trust, the Adviser shall place such orders for each
Portfolio.
(4) Notwithstanding the generality of paragraph (3) above, and subject to
the provisions of paragraphs (5) and (6) below, the Adviser shall endeavor to
secure for each Portfolio the best possible price and execution of every
purchase and sale for the account of each Portfolio. In seeking such best price
and execution the Adviser shall use its own judgment as to the implementation of
its own investment recommendations, including the Adviser's judgment as to the
time when an order should be placed, the number of securities to be bought or
sold in any one trade that is a part of any particular recommendation, and the
market in which an order should be placed.
(5) The Adviser shall use its own judgment in determining the
broker-dealers who shall be employed to execute orders for the purchase or sale
of securities for the Portfolios, in order to:
a. Secure best price and execution on purchases and sales for the
Portfolios; and
b. Secure supplemental research and statistical data for use in making
its recommendations to the Portfolios.
(6) The Adviser shall use its discretion as to when, and in which market,
each Portfolio's transactions shall be executed, in order to secure for the
Portfolios the benefits of best price and execution, and supplemental research
and statistical data. The use of such discretion
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shall be subject to review by the Trustees of the Trust at any time and from
time to time. The Trust, acting by its Trustees, may withdraw said discretion at
any time, and may direct the execution of portfolio transactions for the
Portfolios in any lawful manner different from that provided for herein. Until a
decision is made to withdraw or limit the discretion herein granted, the Adviser
shall not be liable for any loss suffered by the Portfolios through the exercise
by the Adviser of that discretion unless the Adviser shall be guilty of gross
negligence or willful misconduct.
II
ADMINISTRATIVE RESPONSIBILITY
-----------------------------
During the continuance of this Agreement, Adviser shall provide (either by
itself or by contracting with others) the Portfolios with a continuous program
of general administration including:
a. Office space, equipment, supplies and utility services as shall be
required to conduct each Portfolio's business;
b. The provision and supervision of all persons performing the
executive, administrative, and clerical functions necessary for the conduct
of each Portfolio's business, including providing for services to be
performed by each Portfolio's Transfer Agent, Dividend Disbursing Agent,
Redemption Agent, Administrators and Auditors, except as set forth in g.,
below;
c. The supervision of accounting, and of records and record keeping
for the Portfolios;
d. The preparation and distribution of mandatory reports to
Portfolios' shareholders and regulatory bodies;
e. The supervision of the daily net asset value of each Portfolio;
f. The preparation and distribution on behalf of the Portfolios of
notices of shareholders and Trustee meetings, agendas, proxies, and proxy
statements; and
g. Other facilities, services, and activities necessary for the
conduct of each Portfolio's business, except for services by each
Portfolio's Custodian.
III
SERVICE AGREEMENTS
------------------
The Trust authorizes Mutual Funds Service Co., a corporation organized and
existing under the laws of the State of Ohio ("MFSCO"), to act as the Trust's
agent. The Trust further authorizes the Adviser to enter into agreements with
MFSCO and act in the capacities set forth in
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such agreements. The Adviser, in order to provide the Portfolios with the
services set forth in II a to g above, shall simultaneously with the execution
of this Agreement enter into each of the following three agreements with MFSCO:
(a) Administration Agreement, a copy of which is attached hereto and
incorporated herein as Exhibit A (the "Administration Agreement");
(b) Administration Services Agreement, a copy of which is attached hereto
and incorporated herein as Exhibit B (the "Administration Services
Agreement"); and
(c) Accounting Services Agreement, a copy of which is attached hereto and
incorporated herein as Exhibit C (the "Accounting Services
Agreement").
The Administration Agreement, the Administration Services Agreement and
theAccounting Services Agreement are collectively referred to as the
"Service Agreements".
IV
ALLOCATION OF EXPENSES
----------------------
The Adviser will pay all operating expenses of the Portfolios, including
the compensation and expenses of any employees of the Portfolios and of any
other persons rendering any services to the Portfolios; clerical and shareholder
service staff salaries; office space and other office expenses; fees and
expenses incurred by the Portfolios in connection with membership in investment
company organizations; legal, auditing and accounting expenses (except as
otherwise provided below); expenses of registering shares under federal and
state securities laws, including expenses incurred by the Portfolios in
connection with the organization and initial registration of shares of the
Portfolios; insurance expenses; fees and expenses of the custodian, transfer
agent, dividend disbursing agent, shareholder service agent, plan agent,
administrator, accounting and pricing services agent; expenses, including
clerical expenses, of issue, sale, redemption or repurchase of shares of the
Portfolios; the cost of preparing and distributing reports and notices to
shareholders, the cost of printing or preparing prospectuses and statements of
additional information for delivery to each Portfolio's current and prospective
shareholders; the cost of printing or preparing stock certificates or any other
documents, statements or reports to shareholders; expenses of shareholders'
meetings and proxy solicitations; advertising, promotion and other expenses
incurred directly or indirectly in connection with the sale or distribution of
each Portfolio's shares (excluding any expenses which each Portfolio is
authorized to pay pursuant to Rule 12b-1 (if applicable) under the 0000 Xxx);
and all other organizational and operating expenses not specifically assumed by
the Portfolios.
The Portfolios will pay all brokerage fees and commissions, taxes,
interest, fees and expenses of the independent trustees (and their independent
legal counsel, if any) and such extraordinary or non-recurring expenses as may
arise, including litigation to which the Portfolios may be a party and
indemnification of the Trust's trustees and officers with respect thereto. The
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Portfolios may also pay up to 0.35% of their average daily net assets to
intermediaries who, under a "platform" arrangement, take responsibility for
providing record keeping, sub-accounting, redemption and/or other transfer
related, and other administrative services to their account holders.
Additionally, the Portfolios shall pay any expenses that they are authorized to
pay pursuant to Rule 12b-1 (if applicable) under the 1940 Act. The Adviser may
obtain reimbursement from the Portfolios, at such time or times as the Adviser
may determine in its sole discretion, for any of the expenses advanced by the
Adviser, which each Portfolio is obligated to pay, and such reimbursement shall
not be considered to be part of the Adviser's compensation pursuant to this
Agreement.
V
COMPENSATION
------------
Each Portfolio shall pay the Adviser a fee, based on the value of the net
assets of each Portfolio determined in accordance with the Trust's Declaration
of Trust, and computed as follows:
(a) The annual advisory fee (the "Fee") shall be equal to 0.95% of each
Portfolio's average daily net assets.
(b) The Fee due the Adviser as set forth above will be accrued daily and
shall be paid to the Adviser in pro rata monthly installments due and
payable on the first business day of each calendar month.
(c) The Adviser may waive all or part of its Fee or reimburse the
Portfolio's expenses, at any time, and at its sole discretion, but
such action shall not obligate the Adviser to waive any Fees or
reimburse each Portfolio's expenses in the future.
(d) The Adviser shall be responsible for timely making all payments due to
MFSCO under each of the Service Agreements.
VI
DURATION AND TERMINATION
------------------------
(1) This Agreement shall have an initial term of two years beginning on the
date first written above. Thereafter this Agreement shall continue in effect
from year to year, subject to the termination provisions and all other terms and
conditions hereof; if: (a) such continuation shall be specifically approved at
least annually by vote of the holders of a majority of the outstanding voting
securities of the Portfolios or by the vote, cast in person at a meeting called
for the purpose of voting on such approval, of a majority of the Trustees of the
Trust who are not parties to this Agreement or interested persons of any such
party; and (b) the Adviser shall not
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have notified the Portfolios, in writing, at least 60 days prior to the
expiration of any term, that it does not desire such continuation. The Adviser
shall furnish to the Trust, promptly upon its request, such information as may
reasonably be necessary to evaluate the terms of this Agreement or any
extension, renewal or amendment hereof.
(2) This Agreement may not be amended, transferred, sold or in any manner
hypothecated or pledged, without the affirmative vote of a majority of the
outstanding voting securities of a Portfolio, and this Agreement shall
automatically and immediately terminate in the event of its assignment.
(3) After the initial term, this Agreement may be terminated by either
party hereto, without the payment of any penalty, upon 60 days' notice in
writing to the other party, provided, that in the case of termination by the
Trust such action shall have been authorized by resolution of the Trustees of
the Trust or by vote of a majority of the outstanding voting securities of a
Portfolio.
VII
MISCELLANEOUS
-------------
(1) The Adviser shall not deal with the Portfolios as broker or dealer but
the Adviser may enter orders for the purchase or sale of each Portfolio's
securities through a company or companies that are under common control with the
Adviser, provided such company acts as broker and charges a commission that does
not exceed the usual and customary broker's commission if the sale is effected
on a securities exchange, or, one percent of the purchase or sale price of such
securities if the sale is otherwise effected. In connection with the purchase or
sale of portfolio securities for the account of each Portfolio, neither the
Adviser nor any officer or director of the Adviser shall act as a principal.
(2) Except as expressly prohibited in this Agreement, nothing herein shall
in any way limit or restrict the Adviser, or any officers, shareholders or
employees of Adviser, from buying selling or trading in any security for its or
their own account. Neither the Adviser nor any Officer or Director thereof shall
take a short position in any interests of any Portfolio or otherwise purchase
such interests for any purpose other than that of investment. However, the
Adviser may act as underwriter or distributor provided it does so pursuant to a
written contract approved in the manner specified in the 1940 Act.
(3) The Adviser may act as investment adviser to, and provide management
services for, other investment companies, and may engage in businesses that are
unrelated to investment companies, without limitation, provided the performance
of such services and the transaction of such businesses does not impair the
Adviser's performance of this Agreement.
(4) The Adviser shall not be liable for any error of judgment or mistake of
law or for any loss suffered by any Portfolio in connection with the matters to
which this Agreement relates (including, but not limited to, loss sustained by
reason of the adoption or implementation of any investment policy or the
purchase, sale or retention of any security), except for loss resulting
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from willful misfeasance, bad faith or gross negligence of the Adviser in the
performance of its duties or from reckless disregard by the Adviser of its
obligations and duties under this Agreement.
(5) Any question of interpretation of any term or provision of this
Agreement having a counterpart in or otherwise derived from a term or provision
of the 1940 Act, shall be resolved by reference to such term or provision of the
Act and to interpretations thereof, if any, by the United States courts or, in
the absence of any controlling decision of any such court, by rules, regulations
or orders of the Securities and Exchange Commission validly issued pursuant to
said Act. Specifically, the terms "vote by a majority of the outstanding voting
securities", "annually", "interested person", "assignment", and "affiliated
person", as used herein, shall have the meanings assigned to them by the 1940
Act. In addition, where the effect of a requirement of the 1940 Act, reflected
in any provision of this contract is relaxed by a rule, regulation or order of
the Securities and Exchange Commission, whether of special or of general
application, such provision shall be deemed to incorporate the effect of such
rule, regulation or order.
(6) The Trust will provide the Adviser with all information concerning the
investment policies and restrictions of the Portfolios as the Adviser may from
time to time request or which the Trust deems necessary. In the event of any
change in the investment policies or restrictions of the Portfolios, the Trust
will promptly provide Adviser with all information concerning such change
including, but not limited to, copies of all documents filed by the Trust with
the Securities and Exchange Commission.
(7) The Trustees, officers, employees and agents of the Trust shall not be
personally bound by or liable hereunder, nor shall resort be had to their
private property for the satisfaction of any obligation or claim hereunder.
(8) Except to the extent the provisions of this Agreement are governed by
federal law, they shall be governed by the law of Ohio, without reference to its
choice of law rules.
(9) This Agreement represents the entire agreement between the parties
hereto and may be amended or modified by the parties in any manner by written
agreement executed by each of the parties hereto
(10) Any notice or other communication required by or permitted to be given
in connection with this Agreement shall be in writing, and shall be delivered in
person or sent by certified mail, postage prepaid, return receipt requested, to
the respective parties as follows:
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If to the Trust:
----------------
Meeder Premier Portfolios
0000 Xxxxxxxx Xxxxx
Xxxxxx, XX 00000
If to the Adviser:
------------------
Xxxxxx Asset Management, Inc.
0000 Xxxxxxxx Xxxxx
Xxxxxx, XX 00000
If to MFSCO:
------------
Mutual Funds Service Co.
0000 Xxxxxxxx Xxxxx
Xxxxxx, XX 00000
Any such notice shall be deemed to have been given upon receipt.
(11) The parties hereto agree that MFSCO and the Bank are intended to be
third party beneficiaries of this Agreement.
(12) This Agreement may be executed in two or more counterparts, each of
which shall be considered an original.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
signed by their respective officers thereunto duly authorized as of the day and
year first above written.
MEEDER PREMIER PORTFOLIOS
Attest: ________________________ By:__________________________
Secretary
XXXXXX ASSET MANAGEMENT, INC.
Attest: ________________________ By:__________________________
Secretary
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The foregoing rights and obligations are hereby acknowledged and agreed to:
MUTUAL FUNDS SERVICE CO.
By:_________________________
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SCHEDULE A
DEFENSIVE EQUITY PORTFOLIO
GROWTH PORTFOLIO
FIXED INCOME PORTFOLIO
AGGRESSIVE GROWTH PORTFOLIO
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