EXHIBIT (D)(XXI)
THE ENTERPRISE GROUP OF FUNDS, INC.
FUND MANAGER'S AGREEMENT
THIS AGREEMENT, made the 1st day of January, 2002, is among THE
ENTERPRISE GROUP OF FUNDS, INC. (the "Fund"), a Maryland corporation, ENTERPRISE
CAPITAL MANAGEMENT, INC., a Georgia corporation (hereinafter referred to as the
"Adviser"), and XXXXXXXX-XXXXXXXXX CAPITAL MANAGEMENT, a Delaware limited
liability company (hereinafter referred to as the "Fund Manager").
BACKGROUND INFORMATION
(A) The Adviser has entered into an Investment Adviser's Agreement with
the Fund ("Investment Adviser's Agreement"). Pursuant to the Investment
Adviser's Agreement, the Adviser has agreed to render investment advisory and
certain other management services to all of the Portfolios of the Fund, and the
Fund has agreed to employ the Adviser to render such services and to pay to the
Adviser certain fees therefore. The Investment Adviser's Agreement recognizes
that the Adviser may enter into agreements with other investment advisers who
will serve as Fund Managers to the Portfolios of the Fund.
(B) The parties hereto wish to enter into an agreement (the
"Agreement") whereby the Fund Manager will provide to portfolios of the Fund set
forth in Exhibit A (the "Portfolios") securities investment advisory services
for the Portfolios, subject to requisite approvals under the Investment Company
Act of 1940. The Fund, the Adviser, and the Fund Manager are registered under
the 1940 Act.
WITNESSETH THAT:
In consideration of the mutual covenants herein contained, the Fund,
Adviser and the Fund Manager agree as follows:
(1) The Fund and Adviser hereby employ the Fund Manager to render
certain investment advisory services to the Portfolios, as set forth herein. The
Fund Manager hereby accepts such employment and agrees to perform such services
on the terms herein set forth, and for the compensation herein provided.
(2) The Fund Manager shall furnish the Portfolios advice with respect
to the investment and reinvestment of the assets of the Portfolios, or such
portion of the assets of the Fund as the Adviser shall specify from time to
time, in accordance with the investment objectives, restrictions and limitations
of the Portfolios, as set forth in the Fund's most recent Registration
Statement.
(3) The Fund Manager shall perform a monthly reconciliation of the
Portfolio to the holdings report provided by the Fund's custodian and bring any
material or significant variances regarding holdings or valuations to the
attention of the Adviser.
(4) The Fund Manager shall for all purposes herein be deemed to be an
independent contractor. The Fund Manager has no authority to act for or
represent the Fund or the Portfolios in any way except to
direct securities transactions for the Portfolios pursuant to their investment
advice hereunder. The Fund Manager is not an agent of the Fund or the
Portfolios.
(5) Unless otherwise notified in writing, Xxxxxxxx-Xxxxxxxxx will vote
all proxies and take any other actions relating to the securities in the account
including exercise of rights and acceptance of tender offers, etc. subject to
any investment guidelines provided by the client.
(6) It is understood that the Fund Manager does not, by this Agreement,
undertake to assume or pay any costs or expenses of the Fund or the Portfolios.
(6) (a) The Adviser agrees to pay as compensation to the Fund Manager
as set forth in Exhibit A for its services to be furnished under this Agreement,
with respect to each calendar month after the effective date of this Agreement,
on the twentieth (20th) day after the close of each calendar month.
(6) (b) The payment of all fees provided for hereunder shall be
prorated and reduced for sums payable for a period less than a full month in the
event of termination of this Agreement on a day that is not the end of a
calendar month.
(6) (c) For the purposes of this Paragraph 6, the daily closing net
asset values of the Portfolios shall be computed in the manner specified in the
Registration Statement for the computation of the value of such net assets in
connection with the determination of the net asset value of the shares of the
respective Portfolios.
(7) The services of the Fund Manager hereunder are not to be deemed to
be exclusive, and the Fund Manager is free to render services to others and to
engage in other activities so long as its services hereunder are not impaired
thereby. Without in any way relieving the Fund Manager of its responsibilities
hereunder, it is agreed that the Fund Manager may employ others to furnish
factual information, economic advice and/or research, and investment
recommendations, upon which its investment advice and service is furnished
hereunder. The Fund Manager may, from time to time hereafter, act as investment
adviser to one or more other investment companies and fiduciary or other managed
accounts, provided that when the Fund Manager purchases or sells securities of
the same issuer on behalf of two or more advisory clients the available
securities will be allocated in a manner believed by the Fund Manager to be
equitable to each client.
(8) In the absence of willful misfeasance, bad faith or gross
negligence in the performance of its duties hereunder, or reckless disregard of
its obligations and duties hereunder, the Fund Manager shall not be liable to
the Fund, the Portfolios or the Adviser or to any shareholder or shareholders of
the Fund, the Portfolios or the Adviser for any mistake of judgment, act or
omission in the course of, or connected with, the services to be rendered by the
Fund Manager hereunder.
(9) The Fund Manager will take reasonable steps to prevent the
investment professionals of the Fund Manager who are responsible for investing
assets of each of the Portfolios from taking, at any time, a short position in
any shares of any holdings of any Portfolios of the Fund for any accounts in
which such individuals have a beneficial interest, excluding short positions,
including without limitation, short against-the-box positions, effected for tax
reasons, short positions held by investment companies in which the investment
professional may hold a beneficial interest, and short positions of other
investment products over which the investment professional has no investment
control. The Fund Manager also will
cooperate with the Fund in adopting a written policy prohibiting xxxxxxx xxxxxxx
with respect to the Portfolios transactions insofar as such transactions may
relate to the Fund Manager.
(10) In connection with the management of the investment and
reinvestment of the assets of the Portfolios, the Fund Manager is authorized to
select the brokers or dealers that will execute purchase and sale transactions
for the Portfolios, and is directed to use its best efforts to obtain the best
available price and most favorable execution with respect to such purchases and
sales of Portfolio securities for the Portfolios. Subject to this primary
requirement, and maintaining as its first consideration the benefits for the
Portfolios and its shareholders, the Fund Manager shall have the right, subject
to the approval of the Board of Directors of the Fund and of the Adviser, to
follow a policy of selecting brokers and dealers who furnish statistical
research and other services to the Fund, the Portfolios, the Adviser, or the
Fund Manager and, subject to the Conduct Rules of the National Association of
Securities Dealers, Inc., to select brokers and dealers who sell shares of
Portfolios.
(11) The Fund may terminate this Agreement as to any or all of the
Portfolios by sixty (60) days written notice to the Adviser and the Fund Manager
at any time, without the payment of any penalty, by vote of the Fund's Board of
Directors, or by vote of a majority of its outstanding voting securities of the
applicable Portfolio(s). The Adviser may terminate this Agreement by sixty (60)
days' written notice to the Fund Manager and the Fund Manager may terminate this
Agreement by sixty (60) days written notice to the Adviser, without the payment
of any penalty. This Agreement shall immediately terminate in the event of its
assignment, unless an order is issued by the Securities and Exchange Commission
conditionally or unconditionally exempting such assignment from the provision of
Section 15 (a) of the Investment Company Act of 1940, in which event this
Agreement shall remain in full force and effect.
(12) Subject to prior termination as provided above, this Agreement
shall continue in force from the date of execution until September 28, 2002 and
from year to year thereafter if its continuance after said date: (1) is
specifically approved on or before said date and at least annually thereafter by
vote of the Board of Directors of the Fund, including a majority of those
Directors who are not parties to this Agreement or interested persons of any
such party, or by vote of a majority of the outstanding voting securities of the
Fund, and (2) is specifically approved at least annually by the vote of a
majority of Directors 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.
(13) The Adviser shall indemnify and hold harmless the Fund Manager,
its officers and directors and each person, if any, who controls the Fund
Manager within the meaning of Section 15 of the Securities Act of 1933 (any and
all such persons shall be referred to as "Indemnified Party"), against any loss,
liability, claim, damage or expense (including the reasonable cost of
investigating or defending any alleged loss, liability, claim, damages or
expense and reasonable counsel fees incurred in connection therewith), arising
from the Indemnified Party's performance or non-performance of any duties under
this Agreement. However, in no case (i) is this indemnity to be deemed to
protect any particular Indemnified Party against any liability to which such
Indemnified Party would otherwise be subject by reason of willful misfeasance,
bad faith or gross negligence in the performance of its duties or by reason of
reckless disregard of its obligations and duties under this Fund Manager's
Agreement or (ii) is the Adviser to be liable under this indemnity with respect
to any claim made against any particular Indemnified Party unless such
Indemnified Party shall have notified the Adviser in writing within a reasonable
time after the summons or other first legal process giving information of the
nature of the claim shall have been served upon the Fund Manager or such
controlling persons.
The Fund Manager shall indemnify and hold harmless the Adviser and each
of its directors and officers and each person if any who controls the Adviser
within the meaning of Section 15 of the Securities Act of 1933, against any
loss, liability, claim, damage or expense described in the foregoing indemnity,
but only with respect to the Fund Manager's willful misfeasance, bad faith or
gross negligence in the performance of its duties under this Fund Manager's
Agreement. In case any action shall be brought against the Adviser or any person
so indemnified, in respect of which indemnity may be sought against the Fund
Manager, the Fund Manager shall have the rights and duties given to the Adviser,
and the Adviser and each person so indemnified shall have the rights and duties
given to the Fund Manager by the provisions of subsection (i) and (ii) of this
section.
(14) Except as otherwise provided in paragraph 13 hereof and as may be
required under applicable federal law, this Fund Manager's Agreement shall be
governed by the laws of the State of Georgia.
(15) The Fund Manager agrees to notify the parties within a reasonable
period of time regarding a change in its General Partner(s).
(16) The terms "vote of a majority of the outstanding voting
securities," "assignment" and "interested persons," when used herein, shall have
the respective meanings specified in the Investment Company Act of 1940 as now
in effect or as hereafter amended.
(17) Unless otherwise permitted, all notices, instructions and advice
with respect to security transactions or other matters contemplated by this
Agreement shall be deemed duly given when received in writing:
by the Fund Manager: Xxxxxxxx-Xxxxxxxxx Capital Management
000 Xxxx Xxxxxxxx, 00xx Xxxxx
Xxx Xxxxx, XX 00000
Fax: (000) 000-0000
Attn: Director, Portfolios Service/Marketing
Copy to: Xxxxxxx X. Field, Deputy General
Counsel
by the Adviser: Enterprise Capital Management, Inc.
0000 Xxxxxxxxx Xxxx XX, Xxxxx 000
Xxxxxxx, XX 00000 1022
Attn: Xxxxxx Xxxxxx, Chairman, President and CEO
by the Fund: The Enterprise Group of Funds, Inc.
c/o Enterprise Capital Management, Inc.
0000 Xxxxxxxxx Xxxx XX, Xxxxx 000
Xxxxxxx, XX 00000 1022
Attn: Xxxxxx Xxxxxx, Chairman, President and CEO
(18) If any provision of this Agreement shall be held or made
invalid by a count decision, statute or rule, or shall be otherwise rendered
invalid, the remainder of this Agreement shall not be affected thereby.
(19) The Fund hereby consents to the reasonable use of its name in
marketing materials developed and distributed by or on behalf of Fund Manager.
In addition, it is understood that the name "Xxxxxxxx-Xxxxxxxxx" or the name of
any of its affiliates, or any derivative associated with those names, are the
valuable property of the Fund Manager and its affiliates and that the Fund
and/or the Fund's distributor have the right to use such name(s) or
derivative(s) in offering materials and sales literature of the Fund so long as
this Agreement is in effect. Upon termination of the Agreement, the Fund shall
forthwith cease to use such name(s) or derivative(s).
(20) The Fund has received from Fund Manager and reviewed the
disclosure statement or "brochure" required to be delivered pursuant to Rule
204-3 of the Act (the "Brochure"), which Brochure was received and reviewed by
the Fund more than 48 hours prior to entering into this Agreement.
(21) This Agreement may be executed in one or more counterparts, each
of which shall be deemed to be an original; and all of which, when taken
together, shall constitute one and the same agreement.
(22) This Agreement constitutes the entire agreement between the Fund
Manager, the Fund and the Fund relating to the Portfolios.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
signed by their duly authorized officers and their corporate seals hereunder
duly affixed and attested, as of the date first above written.
THE ENTERPRISE GROUP OF FUNDS, INC.
(SEAL)
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ATTEST: By: Xxxxxx Xxxxxx
Secretary Chairman, President, and Chief Executive Officer
ENTERPRISE CAPITAL MANAGEMENT, INC.
(SEAL)
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ATTEST: By: Xxxxxx Xxxxxx
Secretary Chairman, President, and Chief Executive Officer
XXXXXXXX-XXXXXXXXX CAPITAL
MANAGEMENT
(SEAL)
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ATTEST: XXXXXX X. XXXXX By: E. XXXXX XXXXX, JR.
Contracts Manager General Counsel
EXHIBIT A
NAME OF PORTFOLIO FEE
----------------- ---
Mid-Cap Growth .4375% on the first $50
million; .375% on the next $450
million; .3375% on the next $500
million; .325% thereafter
Global Health Care .60% on the first $50
million; .50% on the next $450
million; .45% on the next $500
million; .425% thereafter
