Exhibit (d)(1)
INVESTMENT MANAGEMENT AGREEMENT
AGREEMENT made as of this __ day of __________, 2007 between Barclays Global
Fund Advisors, a corporation organized under the laws of the State of
California (the "Adviser"), and Barclays Foundry Investment Trust, a statutory
trust organized under the laws of the State of Delaware (the "Trust").
WHEREAS, the Adviser is principally engaged in the business of rendering
investment management services and is registered as an investment adviser under
the Investment Advisers Act of 1940 (the "Advisers Act"); and
WHEREAS, the Trust proposes to engage in the business of an investment
company and is registered as such under the Investment Company Act of 1940 (the
"1940 Act"); and
WHEREAS, the Trust is authorized to issue shares of beneficial interest in
separate series with each such series representing interests in a separate
portfolio of securities and other assets; and
WHEREAS, the Trust intends initially to offer shares representing interests
in each of the separate series listed on Schedule A attached hereto (each, an
"Initial Fund" and collectively, the "Initial Funds"); and
WHEREAS, the Trust desires to appoint the Adviser to serve as the investment
adviser with respect to each of the Initial Funds; and
WHEREAS, the Trust may, from time to time, offer shares representing
interests in one or more additional series (each, an "Additional Fund" and
collectively, the "Additional Funds"); and
WHEREAS, the Trust may desire to appoint the Adviser as the investment
adviser with respect to one or more of the "Additional Funds" (each such
Additional Fund and Initial Fund being referred to herein individually as a
"Fund" and collectively as the "Funds");
NOW THEREFORE, the parties hereto hereby agree as follows:
1. APPOINTMENT OF THE ADVISER
The Trust hereby appoints the Adviser to act as investment manager for the
Initial Funds for the period and on terms set forth herein. The Adviser
accepts such appointment and agrees to render such services for the
compensation set forth herein. In the event that the Trust desires to retain
the Adviser to render services hereunder with respect to an Additional Fund,
and the Adviser is willing to render such services, Schedule A shall be
amended in accordance with Section 8,
paragraph b herein, whereupon such Additional Fund shall become a Fund
hereunder.
2. DUTIES OF THE ADVISER
The Adviser, at its own expense shall: (i) furnish continuously an
investment program for each Fund; (ii) manage the investment and
reinvestment of Fund assets; (iii) determine what investments shall be
purchased, held, sold or exchanged for each Fund and what portion, if any,
of the assets of each Fund shall be held uninvested; (iv) make changes on
behalf of the Trust in the investments for each Fund; (v) provide the Trust
with records concerning the Adviser's activities that the Trust is required
to maintain; and (vi) render reports to the Trust's officers and Board of
Trustees concerning the Adviser's discharge of the foregoing
responsibilities. In addition, the Adviser will arrange for other necessary
services to each Fund, including custodial, transfer agency, administration
and principal underwriting services, but excluding distribution services
(e.g., services the expenses for which would be required to be paid out of
Fund assets pursuant to a plan adopted pursuant to Rule 12b-1 under the 1940
Act), shareholder servicing services and shareholder processing services
(the "Excluded Services"). The Adviser shall furnish to the Trust all office
facilities, equipment, services and executive and administrative personnel
necessary for managing the investment program of the Trust for each Fund.
The Adviser may at its expense employ others to provide all or any part of
such facilities and personnel.
In rendering the services to be provided pursuant to this Agreement with
respect to a Fund, the Adviser may, from time to time, engage or associate
itself with such persons or entities (including affiliates of the Adviser)
as it determines is necessary or convenient in its sole discretion and may
contract with such persons or entities to obtain investment advisory or
sub-advisory services, custodial services, transfer agency services,
administration or sub-administration services, and/or principal underwriting
services, or such other services or information as the Adviser deems
appropriate for the Fund. The Adviser shall continue to supervise and
monitor the performance of services provided by any such person or entity.
The Adviser shall remain fully liable, subject to the provisions of
Section 6 herein, for any services that are provided by any such person or
entity to the Fund pursuant to a contract between the Adviser and that
person or entity.
The Adviser shall discharge the foregoing responsibilities subject to the
oversight of the Board of Trustees of the Trust and in compliance with such
policies as the Trustees may from time to time establish, each Fund's
investment objective and policies, as set forth in the then current
prospectus and statement of additional information for such Fund contained
in the Trust's Registration Statement on Form N-1A, as such prospectus and
statement of additional information is amended or supplemented from time to
time, and applicable laws and regulations. Further, any arrangement entered
into by the Adviser pursuant to the immediately
2
preceding paragraph shall, to the extent required by law (including the 1940
Act), be subject to approval by the Board of the Trustees of the Trust,
including approval by a majority of the Trustees who are not "interested
persons" (as defined in the Act) of the Trust (the "Independent Trustees").
3. CERTAIN RECORDS AND REPORTS
Any records required to be maintained and preserved pursuant to the
provisions of Rule 31a-1 and Rule 31a-2 under the 1940 Act that are prepared
or maintained by the Adviser (or any sub-adviser) on behalf of the Trust are
the property of the Trust and will be surrendered promptly to the Trust at
its request (the "Records"). The Adviser agrees to preserve the Records for
the periods prescribed in Rule 31a-2 under the 1940 Act. The Trust and the
Adviser agree to furnish to each other, if applicable, current prospectuses,
proxy statements, reports to shareholders, certified copies of their
financial statements, and such other information with regard to their
affairs as each may reasonably request.
4. MANAGEMENT FEES; FUND EXPENSES
For the services to be provided by the Adviser hereunder with respect to a
Fund, the Trust shall pay to the Adviser a fee at the rate set forth
opposite such Fund's name on Schedule A attached hereto, provided that the
Trust shall not be obligated to pay any such fee until the commencement of
such Fund's investment operations. Schedule A shall be amended from time to
time to reflect the addition and/or termination of any Fund as a Fund
hereunder and to reflect any change in the management fees payable with
respect to any Fund duly approved in accordance with Section 8, paragraph b
hereunder. All fees payable hereunder shall be accrued daily and paid as
soon as practical after the last day of each month. In any case of
commencement of investment operations or termination of this Agreement with
respect to any Fund during any month, the fee with respect to such Fund for
that month shall be reduced proportionately based upon the number of
calendar days during which it is in effect, and the fee shall be computed
upon the average daily net assets of such Fund for the days during which it
is in effect.
The Adviser agrees to pay (or if paid by the Trust, the Adviser agrees to
promptly reimburse the Trust for) all expenses incurred by the Trust except
for: (i) interest; (ii) taxes; (iii) brokerage and investment expenses, and
other expenses connected with the execution of portfolio transactions,
including without limitation any "Acquired Fund" (as such term is used in
Form N-1A under the 0000 Xxx) fees and expenses, and the costs of short sale
dividends (if any); (iv) fees and expenses incurred in connection with the
Excluded Services; (v) the compensation of the Independent Trustees;
(vi) travel and other expenses of the Independent Trustees in connection
with their attendance at Board and other meetings relating to the Trust;
(vii) fees and expenses of legal counsel for the Independent Trustees;
(vii) fees and expenses of independent auditors; (viii) litigation and
indemnification expenses; and (ix) extraordinary expenses.
3
5. PORTFOLIO TRANSACTIONS
In connection with the management of the investment and reinvestment of Fund
assets pursuant to this Agreement, the Adviser, acting by its own officers,
directors or employees, is authorized to select the brokers or dealers
(including brokers and dealers that are affiliated with the Adviser or the
Trust's principal underwriter) that will execute purchase and sale
transactions for the Trust. In executing portfolio transactions and
selecting brokers or dealers, if any, the Adviser will use its best efforts
to seek on behalf of a Fund the best overall terms available, as described
from time to time in the Trust's Registration Statement. In assessing the
best overall terms available for any transaction, the Adviser shall consider
all factors it deems relevant, including the breadth of the market in and
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 evaluating the
best overall terms available, and in selecting the broker or dealer, if any,
to execute a particular transaction, the Adviser may also consider the
brokerage and research services (as those terms are defined in Section 28(e)
of the 0000 Xxx) provided to any Fund of the Trust. The Adviser may pay to a
broker or dealer who provides such brokerage and research services a
commission for executing a portfolio transaction which is in excess of the
amount of commission another broker or dealer would have charged for
effecting the transaction if, but only if, the Adviser determines in good
faith that such commission was reasonable in relation to the value of the
brokerage and research services provided. The Trust acknowledges that any
such research may be useful to the Adviser in connection with other accounts
managed by it. Brokerage transactions for the Trust may be effected through
affiliates of the Adviser if approved by the Board of Trustees, subject to
applicable rules and regulations. The Adviser will promptly communicate to
the officers and the Trustees of the Trust such information relating to Fund
transactions as they may reasonably request.
Whenever the Adviser deems the purchase or sale of an investment to be in
the best interest of a Fund as well as other clients of the Adviser or its
affiliates, the Adviser may, but shall not be obligated to, aggregate the
investments to be so purchased or sold in order to seek to obtain the best
execution and lower brokerage commissions, if any. Allocation of any
investments so purchased or sold, as well as the expenses incurred in the
transaction, shall be made by the Adviser in the manner that it considers to
be equitable and in accordance with applicable law.
6. LIABILITY OF ADVISER
Neither the Adviser nor its officers, directors, employees, agents,
affiliated persons or controlling persons or assigns (the "Adviser Parties")
shall be liable for any error of judgment or mistake of law or for any loss
suffered by the Trust or its
4
shareholders in connection with the matters to which this Agreement relates;
provided that no provision of this Agreement shall be deemed to protect any
Adviser Party against any liability to the Trust or its shareholders
resulting from any willful misfeasance, bad faith or gross negligence in the
performance of its duties or obligations hereunder, the reckless disregard
of its duties or obligations hereunder, or breach of its fiduciary duty to
the Trust, any Fund or its shareholders, provided, further, that the
provisions of this Section 6 shall not be construed so as to relieve (or
attempt to relieve) any Adviser Party of any liability (including liability
under U.S. federal or state securities laws, including the Advisers Act,
which, under certain circumstances, impose liability even on persons that
act in good faith), to the extent (but only to the extent) that such
liability may not be waived, modified or limited under applicable law.
7. FORCE MAJEURE
Notwithstanding any other provision of this Agreement, Adviser shall not be
liable for any loss suffered by the Trust or its shareholders caused
directly or indirectly by circumstances beyond Adviser's reasonable control
including, without limitation, government restrictions, exchange or market
rulings, suspensions of trading, acts of civil or military authority,
national emergencies, labor difficulties, fires, earthquakes, floods or
other catastrophes, acts of God, wars, riots or failures of communication or
power supply.
8. DURATION, TERMINATION AND AMENDMENT
a. DURATION. This Agreement shall become effective with respect to each
Initial Fund on the date hereof and, with respect to any Additional
Fund, on the date Schedule A is amended to reflect such Additional Fund
in accordance with paragraph b below. Unless terminated in accordance
with this Section 8, the Agreement shall remain in full force and effect
until March 31, 2009 with respect to each Initial Fund and, with respect
to each Additional Fund, for two years from the date on which such Fund
becomes a Fund hereunder. Subsequent to such initial periods of
effectiveness, this Agreement shall continue in full force and effect
for periods of one year thereafter with respect to each Fund so long as
such continuance with respect to such Fund is specifically approved at
least annually (i) by either the Board of Trustees of the Trust or by
vote of a "majority of the outstanding voting securities" (as defined in
the 0000 Xxx) of such Fund, and (ii), in either event, by the vote of a
majority of the Independent Trustees of the Trust, cast in person at a
meeting called for the purpose of voting on such approval. If the
shareholders of any Fund fail to approve the Agreement as provided
herein, the Adviser may continue to serve hereunder in the manner and to
the extent permitted by the 1940 Act and rules and regulations
thereunder. The foregoing requirement that continuance of this Agreement
be "specifically approved
5
at least annually" shall be construed in a manner consistent with the
1940 Act and the rules and regulations thereunder.
b. AMENDMENT. Any amendment to this Agreement shall become effective
with respect to a Fund upon approval of the Adviser, the Board of
Trustees of the Trust, including a majority of the Independent Trustees,
cast in person at a meeting called for the purpose of voting such
approval and, if required under the 1940 Act, a majority of the
outstanding voting securities (as defined in the 0000 Xxx) of the Fund
(or such later date as so approved).
c. APPROVAL, AMENDMENT OR TERMINATION BY A FUND. Any approval, amendment
or termination of this Agreement with respect to a Fund will not require
the approval of any other Fund or the approval of a majority of the
outstanding voting securities of the Trust, unless such approval is
required by applicable law.
d. AUTOMATIC TERMINATION. This Agreement shall automatically and
immediately terminate with respect to any Fund in the event of its
"assignment" (as defined in the 0000 Xxx) with respect to that Fund.
e. TERMINATION. This Agreement may be terminated with respect to any
Fund at any time, without payment of any penalty, by vote of the Board
of Trustees of the Trust or by vote of "a majority of the outstanding
voting securities" (as defined in the 0000 Xxx) of that Fund, or by the
Adviser, in each case on not less than 30 days' nor more than 60 days'
prior written notice to the other party.
9. SERVICES NOT EXCLUSIVE
The services of the Adviser to the Trust hereunder are not to be deemed
exclusive, and the Adviser shall be free to render similar services to
others so long as its services hereunder are not impaired thereby. The
Adviser shall be deemed to be an independent contractor and shall, unless
otherwise expressly provided or authorized, have no authority to act for or
represent the Trust in any way or otherwise be deemed an agent of the Trust.
10.LIMITATION OF LIABILITY
The obligations and expenses incurred, contracted for or otherwise existing
with respect to a Fund shall be enforced against the assets of such Fund or
applicable class thereof and not against the assets of any other class or
any other Fund. It is understood and expressly stipulated that neither the
shareholders of a Fund nor the Trustees of the Trust shall be personally
liable hereunder.
6
11. MISCELLANEOUS
a. 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 in writing for the
receipt of such notices.
b. 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 be thereby affected.
c. APPLICABLE LAW. This Agreement shall be construed in accordance with
and governed by the laws of the State of Delaware and the applicable
provisions of the 1940 Act. To the extent that the applicable laws of
the State of Delaware, or any of the provisions herein, conflict with
the applicable provisions of the 1940 Act, the latter shall control.
d. EXECUTION BY COUNTERPART. This Agreement may be executed in any
number of counterparts, all of which together shall constitute one
agreement.
e. SURVIVAL AFTER TERMINATION. The rights and obligations set forth in
Sections 6 and 10 shall survive the termination of this Agreement.
f. PERMISSIBLE INTERESTS. Trustees, officers, agents and shareholders of
the Trust are or may be interested in the Adviser (or any successor
thereof) as directors, partners, officers, agents, shareholders or
otherwise; directors, partners, officers, agents and shareholders of the
Adviser are or may be interested in the Trust as Trustees, officers,
agents, shareholders or otherwise; and the Adviser (or any successor
thereof) is or may be interested in the Trust as a shareholder or
otherwise.
g. SEPARATE AGREEMENT. The parties hereto acknowledge that certain
provisions of the 1940 Act treat each series of shares of an investment
company as a separate investment company. Accordingly, the parties
hereto acknowledge and agree that, to the extent deemed appropriate and
consistent with the 1940 Act, this Agreement shall be deemed to
constitute a separate agreement between the Adviser and each Fund.
7
IN WITNESS WHEREOF, the parties hereto have caused this agreement to be
executed as of the date first set forth above.
BARCLAYS FOUNDRY INVESTMENT TRUST
By:
-----------------------------
H. Xxxxxxx Xxxxxxxx
Title: President
BARCLAYS GLOBAL FUND ADVISORS
By:
-----------------------------
Xxx X. Xxxxxxxxx
Title: Managing Director
By:
-----------------------------
H. Xxxxxxx Xxxxxxxx
Title: Managing Director
Approved by the Board of Trustees of Barclays Foundry Investment Trust on
August 15-16, 2007.
8
Schedule A
to the
Investment Management Agreement dated __, 2007
between
Barclays Global Fund Advisors
and
Barclays Foundry Investment Trust
Pursuant to Section 4, the Trust shall pay the Adviser compensation at the
following annual rates, expressed as a percentage of average daily net
assets:
Fund Annual Fee
---- ----------
LifePath(R) Index Retirement Portfolio 0.20%
LifePath(R) Index 2010 Portfolio 0.20%
LifePath(R) Index 2020 Portfolio 0.20%
LifePath(R) Index 2030 Portfolio 0.20%
LifePath(R) Index 2040 Portfolio 0.20%
Approved by the Board of Trustees of Barclays Foundry Investment Trust on
August 15-16, 2007.
9
