INVESTMENT COUNSEL AGREEMENT
between
XXXXX & XXXXXX, INC.
and
X.X. XXXXXXXXXXXXX ASSETS
THIS AGREEMENT by and between XXXXX & XXXXXX, INC., a Missouri corporation
with its principal office at the BMA Tower, 000 Xxxxxx Xxxxxxxxx, Xxxxxx Xxxx,
Xxxxxxxx 00000 (the "Manager"), and X.X. XXXXXXXXXXXXX ASSETS (formerly,
Xxxxxx-Xxxxxxx Ivory International), a Massachusetts general partnership with
its principal office at Xxx Xxxxxxxx Xxxxx, Xxxxxxxxx, Xxxxxxxxxxxxx 00000 (the
"Investment Counsel"), is made pursuant to the approval and direction of the
parties' respective authorized officers and/or Board of Directors and may be
executed in any number of counterparts, each of which shall be deemed to be an
original, but all of which together shall constitute but one instrument.
WITNESSETH:
WHEREAS, the Manager and XXXXXX-XXXXXXX IVORY INTERNATIONAL FUND, INC. (the
"Fund") were parties to a Management Agreement under which the Manager provided
management services, including investment advisory services to the Fund; and
WHEREAS, the Manager and Investment Counsel were parties to an Investment
Counsel Agreement under which the Investment Counsel provided the following
services related to the management of the assets of the Fund:
Research, analysis, advice and recommendations with respect to the
purchase and sale of securities and the making of investment
commitments; statistical information and reports as may reasonably be
required, and general assistance in the supervision of the investments
of the Fund, subject to the control of (i) the Directors of the Fund
and (ii) the Manager; and
WHEREAS, following a change of control of the Manager and resulting
termination of the prior Management and Investment Counsel Agreements, the
parties hereto desire to enter into this new Investment Counsel Agreement under
which the Investment Counsel will continue to provide the aforementioned
services relating to the management of the Fund's assets.
NOW, THEREFORE, in consideration of the mutual agreements herein contained,
the parties agree as follows:
1. During the term of this Agreement, or any extension or extensions
thereof, the Investment Counsel will, to the best of its ability, furnish the
foregoing services.
2. As compensation, the Manager will pay Investment Counsel for its
services the following annual fee computed daily as determined by the Fund's
price make-up sheet and which shall be payable monthly or at such other
intervals as agreed by the parties in the amount of:
four hundred seventy-five one-thousandths of one percent (475/1000 of
1%) of the average daily total net assets of the Fund.
3. Provided this Agreement is approved by a majority of the outstanding
voting securities of the Fund, the Agreement shall become effective and run
concurrently with the Investment Advisory Agreement of the same date between the
Manager and the Fund, an executed copy of which shall be supplied to Investment
Counsel.
4. This Agreement shall continue for a period of two years from the date of
its initial effectiveness. Thereafter this Agreement may be renewed for
successive periods not exceeding one year only so long as such renewal and
continuance is specifically approved at least annually by the Board of Directors
of the Fund or by a vote of the majority of the outstanding voting securities of
the Fund as prescribed by the Investment Company Act of 1940, as amended, (the
"Act") and provided further that such continuance is approved at least annually
thereafter by a vote of a majority of the Directors who are not parties to such
Agreement or interested persons (as defined by the Act) of such party, cast in
person at a meeting called for the purpose of voting on such approval. The
Investment Counsel shall provide the Manager such information as may be
reasonably necessary to assist the Directors of the Fund to evaluate the terms
of this Agreement. This Agreement may be terminated at any time, without the
payment of any penalty, by the Board of Directors or by the vote of a majority
of the outstanding voting securities of the Fund, or by the Manager or the
Investment Counsel upon sixty days written notice to the other party. This
Agreement will automatically terminate with the Investment Advisory Agreement
without the payment of any penalty, upon sixty days written notice by the Fund
to the Manager that the Board of Directors or the shareholders by vote of a
majority of the outstanding voting securities of the Fund, as provided by the
Act, has terminated the Investment Advisory Agreement. This Agreement shall
automatically terminate in the event of its assignment or assignment of the
Investment Advisory Agreement unless such assignment is approved by the
Directors and the shareholders of the Fund as herein before provided or unless
an exemption is obtained from the Securities and Exchange Commission from the
provisions of the Act pertaining to the subject matter of this paragraph. The
Manager shall promptly notify the Investment Counsel of any notice of
termination or of any circumstances that are likely to result in a termination
of the Investment Advisory Agreement. This Agreement may be amended at any time
by agreement of the parties, provided that the amendment shall be approved in
the manner required by the Act. For purposes of this Agreement, the terms
"assignment" and "majority of the outstanding voting securities" shall have the
meanings set forth in the Act.
5. It is understood and agreed that the services to be rendered by the
Investment Counsel to the Manager under the provisions of this Agreement are not
to be deemed to be exclusive, and the Investment Counsel shall be free to render
similar or different services to others so long as its ability to render the
services provided for in this Agreement shall not be impaired thereby, and
provided further that the services to be rendered by the Investment Counsel to
the Manager under this Agreement and the compensation provided for in Paragraph
2 hereof shall be limited solely to services with reference to the Fund.
6. The Manager agrees that it will furnish currently to Investment Counsel
all information reasonably necessary to permit Investment Counsel to give the
advice called for under this Agreement and such information with reference to
the Fund that is reasonably necessary to permit Investment Counsel to carry out
its responsibilities under this Agreement, and the parties agree that they will
from time to time consult and make appropriate arrangements as to specific
information that is required under this paragraph and the frequency and manner
with which it shall be supplied.
7. The Investment Counsel shall not be liable for any error of judgment or
mistake at law or for any loss suffered by Manager of the Fund in connection
with any matters to which this Agreement relates except that nothing herein
contained shall be construed to protect the Investment Counsel against any
liability by reason of willful misfeasance, bad faith or gross negligence in the
performance of its duties or by reckless disregard of its obligations or duties
under this agreement.
8. Investment Counsel agrees with Manager that, subject to the terms and
conditions of Paragraphs 8 and 9 of this Agreement, the Fund has the exclusive
right to use the names Xxxxx X. Xxxxxx, X.X. Xxxxxx, Xxxxxx (X.X.) and Xxxxxx,
(the "Babson Name") as part of the Fund's name so long as X.X. XXXXXXXXXXXXX
ASSETS, or any successor in interest, continues as Investment Counsel. The term
"exclusive right" of the Fund appearing herein means that no other investment
company (or series thereof) registered under the Act will be entitled to use the
Babson Name as part of its name so long as the Fund has the right to use it as
part of its name. But nothing herein shall prohibit XXXXX X. XXXXXX & COMPANY
INC. from granting to another investment company, which is managed by the
Manager with X.X. XXXXXXXXXXXXX ASSETS as its Investment Counsel and which has
investment objectives and policies different from those of the Fund, the right
to use the Babson Name in that fund's name. Should (i) the Fund or Manager
terminate X.X. XXXXXXXXXXXXX ASSETS, or its successor in interest, as Investment
Counsel, (ii) XXXXX X. XXXXXX & COMPANY INC., or its successor in interest, be
terminated as Investment Counsel to the Babson Value Fund, Inc., Babson
Enterprise Fund, Inc. or Babson Enterprise Fund II, Inc. or (iii) the Babson
Value Fund, Inc., Babson Enterprise Fund, Inc. or Babson Enterprise Fund II,
Inc. cease using the Babson name as part of such funds' name, XXXXX X. XXXXXX &
COMPANY INC., or its successors in interest, may elect to notify the Fund in
writing that permission to use the Babson Name has been withdrawn for the Fund.
If so notified, it is understood and agreed that XXXXX & XXXXXX, INC., or its
successor in interest, in its capacity as Manager will take all necessary
corporate action to proceed expeditiously to change the name of the Fund and not
use any other name or take any action that would indicate the Fund's continued
association with X.X. XXXXXXXXXXXXX ASSETS. If the use of the Babson Name is so
withdrawn as aforesaid, it is understood and agreed that there shall be no
limitation with respect to the future use of the Babson Name by X.X.
XXXXXXXXXXXXX ASSETS, or its successor in interest.
9. Although it is not anticipated, there may occur some unforeseen reason
that would prohibit X.X. XXXXXXXXXXXXX ASSETS, as a matter of reasonable
business necessity, continuing as Investment Counsel. Should such circumstances
occur, X.X. XXXXXXXXXXXXX ASSETS, or its successor may elect to terminate its
services, even though the Fund would want to continue to use the Babson Name and
continue XXXXX & XXXXXX, INC., or its successor in interest, as Manager with
X.X. XXXXXXXXXXXXX ASSETS, or its successor in interest, as Investment Counsel.
If such termination occurs, upon receipt of written notice from X.X.
XXXXXXXXXXXXX ASSETS, or its successor in interest, it is understood and agreed
that XXXXX & BABSON, INC., or its successor in interest, in its capacity as
Manager will take all necessary corporate action to proceed expeditiously to
change the name of the Fund (but, if necessary, it may take up to one year from
the effective date of such written withdrawal request), and the Fund will not
use any other name or take any other action that would indicate the Fund's
continued association with X.X. XXXXXXXXXXXXX ASSETS. In consideration for this
right, XXXXX X. XXXXXX & COMPANY INC. agrees that, should it so request the
withdrawal of the Babson Name, it will not permit another investment company (or
series thereof) registered under Act to use the Babson Name (except for those
funds, managed by Xxxxx & Xxxxxx, Inc. or its successor in interest, that retain
the right to use the Babson Name under a separate Investment Counsel Agreement)
as part of its name for a period of two years subsequent to the effective date
of the written withdrawal request, unless this prohibition is waived or modified
by the vote of a majority of the directors of the Fund. For this right to
withdraw the Babson Name from the use of the Fund, X.X. XXXXXXXXXXXXX ASSETS
agrees that it will not compete with XXXXX & BABSON, INC., or its successor in
interest, for the management of the Fund during said two-year period, unless
this no-compete provision is waived by XXXXX & XXXXXX, INC., or its successor in
interest.
Each party hereby executes this Agreement as of the _____ day of
____________, 2003, pursuant to the authority granted by its authorized officers
and/or Board of Directors.
X.X. XXXXXXXXXXXXX ASSETS
By: _________________________________
Attest: _______________________
XXXXX & XXXXXX, INC.
By: __________________________________
Attest: ________________________
Accepted and Agreed by:
XXXXXX-XXXXXXX IVORY INTERNATIONAL FUND, INC.
By: ____________________________
Name: __________________________
Title: ___________________________
