\VKS 6.04.doc
INVESTMENT ADVISORY AGREEMENT
THIS INVESTMENT ADVISORY AGREEMENT, made as of May 31, 1997, and
amended June 1, 2004 (the "Agreement"), by and between XXX XXXXXX
STRATEGIC SECTOR MUNICIPAL TRUST (the "Fund"), a Massachusetts
business trust (the "Trust"), and XXX XXXXXX ASSET MANAGEMENT
(the "Adviser"), a Delaware corporation.
1. (a) Retention of Adviser by Fund. Subject to the
terms and conditions set forth herein, the Fund hereby employs
the Adviser to act as the investment adviser for and to manage
the investment and reinvestment of the assets of the Fund in
accordance with the Fund's investment objective and policies and
limitations, and to administer its affairs to the extent
requested by, and subject to the review and supervision of, the
Board of Trustees of the Fund for the period and upon the terms
herein set forth. The investment of funds shall be subject to
all applicable restrictions of applicable law and of the
Declaration of Trust and By-Laws of the Trust, and resolutions of
the Board of Trustees of the Fund as may from time to time be in
force and delivered or made available to the Adviser.
(b) Adviser's Acceptance of Employment. The adviser accepts
such employment and agrees during such period to render such
services, to supply investment research and portfolio management
(including without limitation the selection of securities for the
Fund to purchase, hold or sell and the selection of brokers
through whom the Fund's portfolio transactions are executed, in
accordance with the affairs of the Fund, to furnish offices and
necessary facilities and equipment to the Fund, to provide
administrative services for the Fund, to render periodic reports
to the Board of Trustees of the Fund, and to permit any of its
officers or employees to serve without compensation as trustees
or officers of the Fund if elected to such positions.
(c) Essential Personnel. For a period of one year commencing
on the effective date of this Agreement, the Adviser and the Fund
agree that the retention of (i) the chief executive officer,
president, chief financial officer and secretary of the Adviser
and (ii) each director, officer and employee of the Adviser or
any of its Affiliates (as defined in the Investment Company Act
of 1940, as amended (the "1940 Act")) who serves as an officer of
the Fund (each person referred to in (i) or (ii) hereinafter
being referred to as an "Essential Person"), in his or her
current capacities, is in the best interest of the Fund and the
Fund's shareholders. In connection with the Adviser's acceptance
of employment hereunder, the Adviser hereby agrees and covenants
for itself and on behalf of its Affiliates that neither the
Adviser nor any of its Affiliates shall make any material or
significant personnel changes or replace or seek to replace any
Essential Person or cause to be replaced any Essential Person, in
each case without first informing the Board of Trustees of the
Fund in a timely manner. In addition, neither the Adviser nor
any Affiliate of the Adviser shall change or seek to change or
cause to be changed, in any material respect, the duties and
responsibilities of any Essential Person, in each case without
first informing the Board of Trustees of the Fund in a timely
manner.
(d) Independent Contractor. The Adviser shall be deemed to be
an independent contractor under this Agreement and, unless
otherwise expressly provided or authorized, shall have no
authority to act for or represent the Fund in any way or
otherwise be deemed as agent of the Fund.
(e) Non-Exclusive Agreement. The services of the Adviser to
the Fund under this Agreement are not to be deemed exclusive, and
the Adviser shall be free to render similar services or other
services to others so long as its services hereunder are not
impaired thereby.
2. (a) Fee. For the services and facilities described in
Section 1, the Fund will accrue daily and pay to the Advisor at
the end of each calendar month an investment management fee equal
to a 0.60% of the average daily managed assets of the Fund. For
purposes of determining such fee, average daily managed assets
shall mean the average daily value of the Fund, minus the sum of
accrued liabilities other than the aggregate amount of any
borrowings undertaken by the Fund.
(b) Determination of Net Asset Value. The net asset value of
the Fund shall be calculated as of the close of the New York
Stock Exchange on the last day the Exchange is open for trading
in each calendar week or such other time or times as the trustees
may determine in accordance with the provisions of applicable law
and the Declaration of Trust and By-Laws of the Fund, and
resolutions of the Board of Trustees of the Fund as from time to
time in force. For the purpose of the foregoing computations, on
each such day when net asset value is not calculated, the net
asset value of a share of beneficial interest of the Fund shall
be deemed to be the net asset value of such share as of the close
of business of the last day on which such calculation was made.
(c) Proration. For the month and year in which this Agreement
becomes effective or terminates, there shall be an appropriate
proration of the Adviser's fee on the basis of the number of days
that the Agreement is in effect during such month and year,
respectively.
3. Expenses. In addition to the fee of the Adviser, the
Fund shall assume and pay any expenses for services rendered by a
custodian for the safekeeping of the Fund's securities or other
property, for keeping its books of account, for any other charges
of the custodian and for calculating the net asset value of the
Fund as provided above. The Adviser shall not be required to
pay, and the Fund shall assume and pay, the charges and expenses
of its operations, including compensation of the trustees (other
than those who are interested persons of the Adviser), charges
and expenses of independent accountants, of legal counsel and of
any transfer or dividend disbursing agent, costs of acquiring and
disposing of portfolio securities, cost of listing shares on the
New York Stock Exchange or other exchange, interest (if any) on
obligations incurred by the Fund, costs of share certificates,
membership dues in the Investment Company Institute or any
similar organization, costs of reports and securities laws,
miscellaneous expenses and all taxes and fees to federal, state
or other governmental agencies on account of the registration of
securities issues by the Fund, filing of corporate documents or
otherwise.
The Fund shall not pay or incur any obligation for any management
or administrative expenses for which the Fund intends to seek
reimbursement from the Adviser without first obtaining the
written approval of the Adviser. The Adviser shall arrange, if
desired by the Fund, for officers or employees of the Adviser to
serve, without compensation from the Fund, as trustees, officers
or agents of the Fund it duly elected or appointed to such
positions and subject to their individual consent and to any
limitations imposed by the law.
4. Interested Persons. Subject to applicable statutes and
regulations, it is understood that trustees, officers,
shareholders and agents of the Fund are or may be interested in
the Adviser as directors, officers, shareholders, agents or
otherwise and that the directors, officers, shareholders and
agents of the Adviser may be interested in the Fund as trustees,
officers, shareholders, agents or otherwise.
5. Liability. The Adviser shall not be liable for any
error of judgment or 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 part of the Adviser in the performance of
its obligations and duties, or by reason of its reckless
disregard of its obligations and duties under this Agreement.
6. (a) Term. This Agreement shall become effective on
the date hereof and shall remain in full force until May 31, 1999
unless sooner terminated as hereinafter provided. This Agreement
shall continue in force from year to year thereafter, but only
for so long as such continuance is specifically approved as least
annually, in the manner required by the 1940 Act.
(b) Termination. This Agreement shall automatically terminate
in the event of its assignment. This Agreement may be terminated
at any time without the payment of any penalty by the Fund or by
the Adviser on sixty (60) days written notice to the other party.
The Fund may effect termination by action of the Board of
Trustees or by vote of a majority of the outstanding shares of
stock of the Fund, accompanied by appropriate notice. This
Agreement may be terminated at any time without the payment of
any penalty and without advance notice by the Board of Trustees
or by vote of a majority of the outstanding shares of the Fund in
the event that it shall have been established by a court of
competent jurisdiction that the Adviser or any officer or
director of the Adviser has taken any action which results in a
breach of the covenants of the Adviser set forth herein.
(c) Payment upon Termination. Termination of this Agreement
shall not affect the right of the Adviser to receive payment on
any unpaid balance of the compensation described in Section 2
earned prior to such termination.
7. Severability. If any provision of this Agreement shall
be held or made invalid by a court decision, statute, rule or
otherwise, the remainder shall not thereby affected.
8. Notices. 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 notice.
9. Disclaimer. The Adviser acknowledges and agrees that,
as provided by Section 5.5 of the Declaration of Trust of the
Fund, the shareholders, trustees, officers, employees and other
agents of the Trust and the Fund shall not personally be bound by
or liable hereunder, nor shall resort be had to their private
property for the satisfaction of any obligation or claim
hereunder.
10. Governing Law. All questions concerning the validity,
meaning and effect of this Agreement shall be determined in
accordance with the laws (without giving effect to the conflict-
of-law principles thereof) of the State of Delaware applicable to
contracts made and to be performed in that state.
11. Name. In connection with its employment hereunder, the
Adviser hereby agrees and covenants not to change its name
without the prior consent of the Board of Trustees of the Fund.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be executed by their officers designated below, as amended on
June 1, 2004.
XXX XXXXXX ASSET MANAGEMENT XXX XXXXXX STRATEGIC
SECTOR
MUNICIPAL TRUST
/s/ Xxxx X. Xxxxxxxx /s/ Xxxxxx X.
Xxxxxxx
By: ________________________________ By:
________________________________
Name: Xxxx X. Xxxxxxxx Name: Xxxxxx X.
Xxxxxxx
Title: Managing Director Title:
Executive Vice President and
Chief Executive
Officer
VKS 6.04
