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INVESTMENT ADVISORY AGREEMENT
AGREEMENT made this ___ day of August, 1999, by and between Commonfund
Institutional Funds, a Delaware business trust (the "Fund"), and Commonfund
Asset Management Company (the "Adviser").
WHEREAS, the Fund is an open-end, diversified management investment
company registered under the Investment Company Act of 1940, as amended, which
may consist of several series of shares, each having its own investment policies
(each, a "Portfolio"); and
WHEREAS, the Trust desires to retain the Adviser to render investment
management services with respect to such Portfolios as the Fund and the Adviser
may agree upon and as are set forth in the attached schedule, and the Adviser is
willing to render such services.
NOW, THEREFORE, in consideration of mutual covenants herein contained,
the parties hereto agree as follows:
1. DUTIES OF ADVISER. The Fund employs the Adviser to manage the
investment and reinvestment of the assets of the Portfolio(s),
and to hire (subject to the approval of the Fund's Board of
Trustees and, except as otherwise permitted under the terms of
any exemptive relief obtained in the future by the Adviser
from the Securities and Exchange Commission, or by rule or
regulation, a majority of the outstanding voting securities of
the Portfolio(s)) and to supervise the investment activities
of one or more sub-advisers deemed necessary to carry out the
investment program of the Portfolio(s), and to continuously
review, supervise and (where appropriate) administer the
investment program of the Portfolio(s), to determine in its
discretion (where appropriate) the securities to be purchased
or sold, to provide the Fund with records concerning the
Adviser's activities which the Fund is required to maintain,
and to render regular reports to the Fund's officers and
Trustees concerning the Adviser's discharge of the foregoing
responsibilities. The retention of a sub-adviser by the
Adviser shall not relieve the Adviser of its responsibilities
under this Agreement.
The Adviser shall discharge the foregoing responsibilities
subject to the control of the Board of Trustees of the Fund
and in compliance with such policies as the Trustees may from
time to time establish, and in compliance with the objectives,
policies, and limitations for each such Portfolio set forth in
the Portfolio's prospectus and statement of additional
information as amended from time to time, and applicable laws
and regulations.
The Adviser accepts such employment and agrees, at its own
expense, to render the services and to provide the office
space, furnishings and equipment and the personnel
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(including any sub-advisers) required by it to perform the
services on the terms and for the compensation provided
herein. The Adviser will not, however, pay for the cost of
securities, commodities, and other investments (including
brokerage commissions and other transaction charges, if any)
purchased or sold for the Fund.
2. PORTFOLIO TRANSACTIONS. The Adviser is authorized to select
the brokers or dealers that will execute the purchases and
sales of portfolio securities for the Portfolios and is
directed to use its best efforts to obtain the best net
results as described from time to time in the Portfolios'
Prospectuses and Statement of Additional Information. The
Adviser will promptly communicate to the officers and the
Trustees of the Fund such information relating to portfolio
transactions as they may reasonably request.
It is understood that the Adviser will not be deemed to have
acted unlawfully, or to have breached a fiduciary duty to the
Fund or be in breach of any obligation owing to the Fund under
this Agreement, or otherwise, by reason of its having directed
a securities transaction on behalf of the Fund to a
broker-dealer in compliance with the provisions of Section
28(e) of the Securities Exchange Act of 1934 or as described
from time to time by the Portfolios' Prospectuses and
Statement of Additional Information.
3. COMPENSATION OF THE ADVISER. For the services to be rendered
by the Adviser as provided in Sections 1 and 2 of this
Agreement, the Fund shall pay to the Adviser compensation at
the rate specified in the Schedule(s) which are attached
hereto and made a part of this Agreement. Such compensation
shall be paid to the Adviser at the end of each month, and
calculated by applying a daily rate, based on the annual
percentage rates as specified in the attached Schedule(s), to
the assets. The fee shall be based on the average daily net
assets for the month involved (less any assets of such
Portfolios held in non-interest bearing special deposits with
a Federal Reserve Bank). The Adviser may, in its discretion
and from time to time, waive a portion of its fee.
All rights of compensation under this Agreement for services
performed as of the termination date shall survive the
termination of this Agreement.
4. OTHER EXPENSES. The Fund shall pay all expenses relating to
mailing to existing shareholders prospectuses, statements of
additional information, proxy solicitation material and
shareholder reports.
5. EXCESS EXPENSES. If the expenses for any Portfolio for any
fiscal year (including fees and other amounts payable to the
Adviser, but excluding interest, taxes, brokerage costs,
litigation, and other extraordinary costs) as calculated every
business day would exceed the expense limitations imposed on
investment companies by any
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applicable statute or regulatory authority of any jurisdiction
in which shares of a Portfolio are qualified for offer and
sale, the Adviser shall bear such excess cost.
However, the Adviser will not bear expenses of any Portfolio
which would result in the Portfolio's inability to qualify as
a regulated investment company under provisions of the
Internal Revenue Code.
6. REPORTS. The Fund 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.
7. STATUS OF ADVISER. The services of the Adviser to the Fund are
not to be deemed exclusive, and the Adviser shall be free to
render similar services to others so long as its services to
the Fund 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 Fund in any way or otherwise be deemed an
agent of the Fund.
8. CERTAIN RECORDS. Any records required to be maintained and
preserved pursuant to the provisions of Rule 31a-1 and Rule
31a-2 promulgated under the Investment Company Act of 1940
which are prepared or maintained by the Adviser on behalf of
the Fund are the property of the Fund and will be surrendered
promptly to the Fund on request.
9. LIMITATION OF LIABILITY OF ADVISER. The duties of the Adviser
shall be confined to those expressly set forth herein, and no
implied duties are assumed by or may be asserted against the
Adviser hereunder. The Adviser shall not be liable for any
error of judgment or mistake of law or for any loss arising
out of any investment or for any act or omission in carrying
out its duties hereunder, except a loss resulting from willful
misfeasance, bad faith or gross negligence in the performance
of its duties, or by reason of reckless disregard of its
obligations and duties hereunder, except as may otherwise be
provided under provisions of applicable state law or Federal
securities law which cannot be waived or modified hereby. (As
used in this Paragraph 9, the term "Adviser" shall include
directors, officers, employees and other corporate agents of
the Adviser as well as that entity itself).
10. PERMISSIBLE INTERESTS. Trustees, agents, and shareholders of
the Fund are or may be interested in the Adviser (or any
successor thereof) as directors, partners, officers, or
shareholders, or otherwise; directors, partners, officers,
agents, and shareholders of the Adviser are or may be
interested in the Fund as Trustees, shareholders or otherwise;
and the Adviser (or any successor) is or may be interested in
the Fund as a shareholder or otherwise. In addition, brokerage
transactions for the Fund may be
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effected through affiliates of the Adviser if approved by the
Board of Trustees, subject to the rules and regulations of the
Securities and Exchange Commission.
11. LICENSE OF ADVISER'S NAME. The Adviser hereby agrees to grant
a license to the Fund for use of its name in the name of the
Fund and names of the Portfolios for the term of this
Agreement and such license shall terminate upon termination of
this Agreement.
12. DURATION AND TERMINATION. This Agreement, unless sooner
terminated as provided herein, shall remain in effect until
two years from date of execution, and thereafter, for periods
of one year so long as such continuance thereafter is
specifically approved at least annually (a) by the vote of a
majority of those Trustees of the Fund who are not parties to
this Agreement or interested persons of any such party, cast
in person at a meeting called for the purpose of voting on
such approval, and (b) by the Trustees of the Fund or by vote
of a majority of the outstanding voting securities of each
Portfolio; provided, however, that if the shareholders of any
Portfolio 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 Investment Company Act of 1940
and rules and regulations thereunder. The foregoing
requirement that continuance of this Agreement be
"specifically approved at least annually" shall be construed
in a manner consistent with the Investment Company Act of 1940
and the rules and regulations thereunder.
This Agreement may be terminated as to any Portfolio at any
time, without the payment of any penalty by vote of a majority
of the Trustees of the Fund or by vote of a majority of the
outstanding voting securities of the Portfolio on not less
than 30 days nor more than 60 days written notice to the
Adviser, or by the Adviser at any time without the payment of
any penalty, on 90 days written notice to the Fund. This
Agreement will automatically and immediately terminate in the
event of its assignment. Any notice under this Agreement shall
be given in writing, addressed and delivered, or mailed
postpaid, to the other party at any office of such party.
As used in this Section 12, the terms "assignment",
"interested persons," and a "vote of a majority of the
outstanding voting securities" shall have the respective
meanings set forth in the Investment Company Act of 1940 and
the rules and regulations thereunder; subject to such
exemptions as may be granted by the Securities and Exchange
Commission under said Act.
13. NOTICE. Any notice required or permitted to be given by either
party to the other shall be deemed sufficient if sent by
registered or certified mail, postage prepaid, addressed by
the party giving notice to the other party at the last address
furnished by the other party to the party giving notice: if to
the Fund, at 000 Xxxx Xxxx Xxxx,
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Xxxxxxxx, XX 00000, and if to the Adviser at 000 Xxxx Xxxx
Xxxx, Xxxxxxxx, XX 00000.
14. SEVERABILITY. If any provision of this Agreement shall be held
or made invalid by a court decision, statute, rule or
otherwise, the remainder of this Agreement shall not be
affected thereby.
15. GOVERNING LAW. This Agreement shall be construed in accordance
with 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.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as of the day and year first written above.
COMMONFUND INSTITUTIONAL FUNDS
By:
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Attest:
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Commonfund Asset Management Company
By:
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Attest:
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SCHEDULE A DATED __________, 1999
TO THE
INVESTMENT ADVISORY AGREEMENT
DATED AUGUST ___, 0000
XXXXXXX
XXXXXXXXXX INSTITUTIONAL FUNDS
AND
COMMONFUND ASSET MANAGEMENT COMPANY
Pursuant to Article 3, the Fund shall pay the Adviser compensation at an annual
rate as follows:
Portfolio Annual Fee
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