INVESTMENT ADVISORY AGREEMENT
Transamerica Fund Advisors, Inc.
This Agreement, entered into as of November 1, 2007 between Diversified
Investors Portfolios, a New York trust (referred to herein as the
Trust), and Transamerica Fund Advisors, Inc., a Florida corporation
(referred to herein as TFAI), to provide certain management and
advisory services to each series of the Trust listed on Schedule A
hereto (each, a Fund).
The Trust is registered as an open-end investment company registered
under the Investment Company Act of 1940 (collectively with the
rules and regulations promulgated thereunder and any exemptive
orders thereunder, the 1940 Act), and consists of more than one
series, including the Funds. In managing each of the Funds, as well
as in the conduct of certain of its affairs, the Trust wishes to have
the benefit of the investment advisory services of TFAI and its
assistance in performing certain management functions. TFAI
desires to furnish services for the Trust and to perform the functions
assigned to it under this Agreement for the considerations provided.
Accordingly, the parties have agreed as follows:
Appointment. The Trust hereby appoints TFAI as each Funds
investment adviser for the period and on the terms set forth in this
Agreement. TFAI accepts such appointment and agrees to render
or cause to be rendered the services set forth for the compensation
herein specified.
Investment Advisory Services. In its capacity as investment
adviser to each Fund, TFAI shall have the following responsibilities:
(a)Subject to the supervision of the Trusts Board of Trustees
(the Board), TFAI shall regularly provide the Fund with investment
research, advice, management and supervision and shall furnish a
continuous investment program for the Funds portfolio of securities
and other investments consistent with the Funds investment
objectives, policies and restrictions, as stated in the Funds current
Prospectus and Statement of Additional Information. TFAI shall
determine from time to time what securities and other investments
and instruments will be purchased, retained, sold or exchanged by
the Fund and what portion of the assets of the Funds portfolio will
be held in the various securities and other investments in which the
Fund invests, and shall implement those decisions (including the
execution of investment documentation and agreements), all subject
to the provisions of the Trusts Declaration of Trust and By-Laws
(collectively, the Governing Documents), the 1940 Act and the
applicable rules and regulations promulgated thereunder by the
Securities and Exchange Commission (the SEC) and interpretive
guidance issued thereunder by the SEC staff and any other applicable
federal and state law, as well as the investment objectives, policies
and restrictions of the Fund referred to above, and any other specific
policies adopted by the Board and disclosed to TFAI. TFAI is
authorized as the agent of the Trust to give instructions to the
custodian of the Fund as to deliveries of securities and other
investments and payments of cash for the account of the Fund.
Subject to applicable provisions of the 1940 Act and direction from
the Board, the investment program to be provided hereunder may
entail the investment of all or substantially all of the assets of the
Fund in one or more investment companies.
(b)TFAI will place orders pursuant to its investment determinations
for the Fund either directly with the issuer or with any broker or
dealer, foreign currency dealer, futures commission merchant or
others selected by it. In connection with the selection of such
brokers or dealers and the placing of such orders, subject to applicable
law, brokers or dealers may be selected who also provide brokerage
and research services (as those terms are defined in Section 28(e) of
the Securities Exchange Act of 1934, as amended (the Exchange Act))
to the Fund and/or the other accounts over which TFAI or its affiliates
exercise investment discretion. TFAI is authorized to pay a broker or
dealer who provides such brokerage and research services a commission
for executing a portfolio transaction for the Fund which is in excess
of the amount of commission another broker or dealer would have
charged for effecting that transaction if TFAI determines in good
faith that such amount of commission is reasonable in relation to the
value of the brokerage and research services provided by such broker
or dealer. This determination may be viewed in terms of either that
particular transaction or the overall responsibilities which TFAI and
its affiliates have with respect to accounts over which they exercise
investment discretion. The Board may adopt policies and procedures
that modify and restrict TFAIs authority regarding the execution of
the Funds portfolio transactions provided herein.
(c)The Fund hereby authorizes any entity or person associated with
TFAI which is a member of a national securities exchange to effect
any transaction on the exchange for the account of the Fund which is
permitted by Section 11(a) of the Exchange Act and Rule 11a2-2(T)
thereunder, and the Fund hereby consents to the retention of
compensation for such transactions in accordance with Rule 11a2-2(T)
(a)(2)(iv). Notwithstanding the foregoing, TFAI agrees that it will
not deal with itself, or with Trustees of the Trust or any principal
underwriter of the Fund, as principals or agents in making purchases
or sales of securities or other property for the account of the Fund,
nor will it purchase any securities from an underwriting or selling
group in which TFAI or its affiliates is participating, or arrange for
purchases and sales of securities between the Fund and another
account advised by TFAI or its affiliates, except in each case as
permitted by the 1940 Act and in accordance with such policies and
procedures as may be adopted by the Fund from time to time, and
will comply with all other provisions of the Governing Documents
and the Funds then-current Prospectus and Statement of Additional
Information relative to TFAI and its directors and officers.
(d)TFAI shall, at the request of the Board, exercise voting rights,
rights to consent to corporate action and any other rights pertaining
to each Funds portfolio securities.
Management Services. TFAI shall furnish or make available to each
Fund the services of executive and management personnel to supervise
the performance of administrative, record-keeping, shareholder
relations, regulatory reporting and compliance services, the services
of the Funds custodian and transfer agent, and other functions of the
Fund. TFAI shall also assist in the preparation of reports to
shareholders of each Fund as requested by the Trust. In accordance
with the foregoing, TFAI shall, at the request of the Board, provide
advice and recommendations with respect to other aspects of the
business and affairs of the Fund.
Subadvisers. Subject to the Boards approval, TFAI or any Fund
may enter into contracts with one or more investment subadvisers,
including without limitation, affiliates of TFAI, in which TFAI
delegates to such investment subadvisers any or all its duties
specified hereunder, on such terms as TFAI will determine to be
necessary, desirable or appropriate, provided that in each case
TFAI shall supervise the activities of each such subadviser and further
provided that such contracts impose on any investment subadviser bound
thereby all the conditions to which TFAI is subject hereunder and that
such contracts are entered into in accordance with and meet all
applicable requirements of the 1940 Act.
Activities of TFAI. Nothing in this Agreement shall limit or restrict
the right of any director, officer, or employee of TFAI who may also
be a Trustee, officer or employee of the Trust or a Fund, to engage in
any other business or to devote his or her time and attention in part to
the management or other aspects of any other business, whether of a
similar nature or a dissimilar nature, nor to limit or restrict the
right of TFAI to engage in any other business or to render services
of any kind, including investment advisory and management services,
to any other fund, firm, individual or association. If the purchase or
sale of securities for a Fund and one or more other accounts of TFAI
is considered at or about the same time, transactions in such securities
will be allocated among the accounts in a manner deemed equitable by
TFAI. Such transactions may be combined, in accordance with
applicable laws and regulations, and consistent with TFAIs policies
and procedures as presented to the Board from time to time.
Allocation of Charges and Expenses. During the term of this Agreement,
the Funds will bear all expenses not expressly assumed by TFAI
incurred in the operation of each Fund and the offering of its shares.
Without limiting the generality of the foregoing:
Each Fund shall pay (i) fees payable to TFAI pursuant to this
Agreement; (ii) the cost (including brokerage commissions, if any)
incurred in connection with purchases and sales of the Funds
portfolio securities; (iii) expenses of organizing the Fund; (iv) filing
fees and expenses relating to registering and qualifying and
maintaining the registration and qualification of the Funds
shares for sale under federal and state securities laws; (v) its
allocable share of the compensation, fees and reimbursements
paid to the Trusts non-interested Trustees; (vi) custodian and
transfer agent fees; (vii) legal and accounting expenses allocable
to the Fund, including costs for local representation in the Trusts
jurisdiction of organization and fees and expenses of special counsel,
if any, for the independent Trustees; (viii) all federal, state and
local tax (including stamp, excise, income and franchise taxes)
and the preparation and filing of all returns and reports in connection
therewith; (ix) cost of certificates, if any, and delivery to
purchasers; (x) expenses of preparing and filing reports with
federal and state regulatory authorities; (xi) expenses of shareholders
meetings and of preparing, printing and distributing proxy statements
(unless otherwise agreed to by the Trust and TFAI); (xii) costs of
any liability, uncollectible items of deposit and other insurance or
fidelity bonds; (xiii) any costs, expenses or losses arising out of
any liability of or claim for damage or other relief asserted against
the Trust for violation of any law; (xiv) expenses of preparing,
typesetting and printing prospectuses and supplements thereto for
existing shareholders and of reports and statements to shareholders;
(xv) fees and expenses in connection with membership in investment
company organizations and 12b-1 fees; and (xvi) any extraordinary
expenses incurred by the Trust on behalf of the Fund.TFAI shall pay
all expenses incurred by it in the performance of its duties under
this Agreement. TFAI shall authorize and permit any of its directors,
officers and employees, who may be elected as Trustees or officers
of the Trust, to serve in the capacities in which they are elected, and
shall pay all compensation, fees and expenses of such Trustees
and officers.
Obligation to Provide Information. Each partys obligation
to provide information shall be as follows:
(a)The Trust shall at all times keep TFAI fully informed with
regard to the securities owned by each Fund, the Funds
funds available, or to become available, for investment, and
generally as to the condition of the Funds affairs. The Trust
shall furnish TFAI with such other documents and information
with regard to each Funds affairs as TFAI may from time to
time reasonably request.
(b)TFAI shall at all times keep the Trust fully informed with
regard to each Funds investment performance and investment
mandate compliance, and generally as to the condition of its
affairs. TFAI shall furnish the Trust with such other documents
and information with regard to each Funds affairs as the Trust
may from time to time reasonably request.
Compensation of TFAI. As compensation for the services
performed by TFAI, each Fund shall pay TFAI, as promptly as possible
after the last day of each month, a fee, computed daily at an annual
rate set forth opposite the Funds name on Schedule A annexed hereto.
The first payment of the fee shall be made as promptly as possible at
the end of the month succeeding the effective date of this Agreement,
and shall constitute a full payment of the fee due TFAI for all services
prior to that date. If this Agreement is terminated as of any date
not the last day of a month, such fee shall be paid as promptly as
possible after such date of termination, shall be based on the average
daily net assets of the Fund in that period from the beginning of such
month to such date of termination, and shall be that proportion of such
average daily net assets as the number of business days in such period
bears to the number of business days in such month. The average daily
net assets of the Fund shall in all cases be based only on business
days and be computed as of the time of the regular close of business
of the New York Stock Exchange, or such other time as stated in
the Funds then-current Prospectus or as may be determined by the Board.
Compensation of Trustees, Officers and Employees. No Trustee,
officer or employee of the Trust or a Fund shall receive from the
Trust or the Fund any salary or other compensation as such Trustee,
officer or employee while he is at the same time a director, officer,
or employee of TFAI or any affiliated company of TFAI, except
as the Board may decide. This paragraph shall not apply to Trustees,
executive committee members, consultants and other persons who
are not regular members of TFAIs or any affiliated companys staff.
Term. This Agreement shall continue in effect with respect to each
Fund, unless sooner terminated in accordance with its terms, for two
years from its effective date, and shall continue in effect from year
to year thereafter, provided such continuance is specifically approved
at least annually by the vote of a majority of the Trustees who are
not parties hereto or interested persons of any such party, cast in
person at a meeting called for the purpose of voting on the approval
of the terms of such renewal, and by either the Board or the affirmative
vote of a majority of outstanding voting securities of that Fund.
Termination. This Agreement may be terminated with respect to any
Fund at any time, without penalty, by the Board or by the shareholders
of the Fund acting by vote of at least a majority of its outstanding
voting securities, provided in either case that 60 days written notice
of termination be given to TFAI at its principal place of business.
This Agreement may be terminated with respect to any Fund by
TFAI at any time by giving 60 days written notice of termination
to the Trust, addressed to its principal place of business. This
Agreement may be terminated with respect to any Fund upon the
mutual written consent of TFAI and the Trust. This Agreement
shall terminate automatically in the event of its assignment by
TFAI and shall not be assignable by the Trust without the consent
of TFAI. For the avoidance of doubt, it is understood that this
Agreement may be amended, terminated or not renewed as to one
or more Funds without affecting the other Funds hereunder.
Use of Name. If this Agreement is terminated with respect to any
Fund and TFAI no longer serves as investment adviser to the Fund,
TFAI reserves the right to withdraw from the Trust the use of the
names Transamerica and Transamerica Partners with respect to that
Fund or any name misleadingly implying a continuing relationship
between the Fund and TFAI or any of its affiliates.
Liability of TFAI. TFAI may rely on information reasonably
believed by it to be accurate and reliable. TFAI assumes no
responsibility under this Agreement other than to render the services
called for hereunder, in good faith, and 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 the execution of
securities transactions for any Fund, provided that nothing in this
Agreement shall protect TFAI against any liability to the Fund to
which TFAI would otherwise be subject by reason of willful
misfeasance, bad faith, or gross negligence in the performance of its
duties or by reason of its reckless disregard of its obligations and
duties hereunder. As used in this Section 13, the term TFAI shall
include any affiliates of TFAI performing services for the Trust or the
Fund contemplated hereby and the partners, shareholders, directors,
officers and employees of TFAI and such affiliates.
Meanings of Certain Terms. For the purposes of this Agreement,
each Funds net assets shall be determined as provided in the Funds
then-current Prospectus and Statement of Additional Information and
the terms assignment, interested person, and majority of the
outstanding voting securities shall have the meanings given to them
by Section 2(a) of the 1940 Act, subject to such exemptions as may
be granted by the SEC by any rule, regulation or order.
Amendments. No provision of this Agreement may be changed,
waived, discharged or terminated orally with respect to a Fund, but
only by an instrument in writing signed by the party against which
enforcement of the change, waiver, discharge or termination is sought.
No material amendment of the Agreement shall be effective with
respect to a Fund until approved, if so required by the 1940 Act,
by vote of the holders of a majority outstanding voting securities
of that Fund. Schedule A hereto may be amended at any time to add
additional series of the Trust as agreed by the Trust and TFAI.
Miscellaneous. This Agreement embodies the entire agreement
and understanding between the parties hereto, and supersedes all prior
agreements and understandings relating to the subject matter hereof.
Should any part of this Agreement be held or made invalid by a court
decision, statute, rule or otherwise, the remainder of this Agreement
shall not be affected thereby. This Agreement shall be binding on
and shall inure to the benefit of the parties hereto and their respective
successors. This Agreement replaces the investment advisory agreement
between the Trust and Diversified Investment Advisors, Inc.
(Diversified), and TFAI succeeds to all rights and obligations of
Diversified under all existing subadvisory agreements for the Funds
to which Diversified is a party.
Governing Law. This Agreement shall be construed and the
provisions thereof interpreted under and in accordance with the
laws of the State of Florida and the applicable provisions of the
1940 Act.
Limitation of Liability. A copy of the Trusts Declaration of Trust
is on file with the state of New York, and notice is hereby given
that this Agreement is executed on behalf of the Trustees as Trustees
of the Trust and not individually, and that the obligations under this
Agreement are not binding upon any of the Trustees, officers,
shareholders, agents or employees of the Trust individually, but binding
only upon the assets and property of the applicable Fund. TFAI agrees
that for services rendered to a Fund, or for any claim by it in
connection with services rendered to the Fund, it shall look only to
assets of the Fund for satisfaction and that it shall have no claim
against the assets of any other series of the Trust.
The parties hereto have caused this Agreement to be executed
by their duly authorized signatories as of the date and year first
above written.
TRANSAMERICA FUND ADVISORS, INC.
By: /s/T. Xxxxxxx Xxxxxxx, XX
Name: T. Xxxxxxx Xxxxxxx, XX
Title: Senior Vice President and Chief Compliance Officer
DIVERSIFIED INVESTORS PORTFOLIOS
By: /s/Xxxxxx X. Xxxxxxxxx
Name: Xxxxxx X. Xxxxxxxxx
Title: Vice President, General Counsel and Secretary
Schedule A
Fund
Investment Advisory Fee
Money Market Portfolio
0.25%
High Quality Bond Portfolio
0.35%
Inflation-Protected Securities Portfolio
0.35%
Core Bond Portfolio
0.35%
Total Return Bond Portfolio
0.35%
High Yield Bond Portfolio
0.55%
Balanced Portfolio
0.45%
Value & Income Portfolio
0.45%
Value Portfolio
0.50%
Growth & Income Portfolio
0.60%
Equity Growth Portfolio
0.62%
Aggressive Equity Portfolio
0.77%
Mid-Cap Value Portfolio
0.67%
Mid-Cap Growth Portfolio
0.72%
Small-Cap Value Portfolio
0.82%
Special Equity Portfolio
0.80%
Small-Cap Growth Portfolio
0.87%
International Equity Portfolio
0.75%
