1
Exhibit (d) (4)
INVESTMENT ADVISORY AND SERVICE AGREEMENT
AGREEMENT, made as of April 30, 2001 between PLAN INVESTMENT FUND,
INC., a Maryland corporation (herein called the "Investment Company"), and
BLACKROCK INSTITUTIONAL MANAGEMENT CORPORATION, a Delaware corporation (herein
called "BIMC"), registered as an investment adviser under the Investment
Advisers Act of 1940, as amended.
WHEREAS, the Investment Company is registered as an open-end
diversified, management investment company under the Investment Company Act of
1940, as amended ("1940 Act"); and
WHEREAS, the Investment Company desires to retain BIMC to furnish
investment advisory and administrative services to the Government/REPO Portfolio
of the Investment Company (the "Portfolio"), and BIMC is willing to so furnish
such services;
NOW THEREFORE, in consideration of the premises and mutual covenants
herein contained, it is agreed between the parties hereto as follows:
1. Appointment. The Investment Company hereby appoints BIMC to act as
investment adviser and service agent to the Portfolio for the period and on the
terms set forth in this Agreement. BIMC accepts such appointment and agrees to
furnish the services herein set forth, for the compensation herein provided.
BIMC may delegate those of its duties set forth in Paragraph 4 hereof to any
wholly-owned direct or indirect subsidiary of PNC Bank, National Association or
The PNC Financial Services Group, Inc., provided that BIMC and such delegate
shall promptly provide such information as the Investment
2
Company may reasonably request, and respond to such questions as the Investment
Company may reasonably ask, relative to such delegation, including the
capabilities of the delegate. Any delegation pursuant to the proceeding sentence
shall not be deemed an assignment for purposes of Paragraph 10 hereof.
Notwithstanding such delegation, BIMC shall remain responsible for the
performance of its duties set forth herein pursuant to the standards of care
provided for herein. Except as specifically set forth herein, compliance with
any applicable laws, rules or other requirements will be the responsibility of
the Investment Company.
2. Delivery of Documents. The Investment Company has furnished BIMC
with copies properly certified or authenticated of each of the following:
(a) Articles of Incorporation of the Investment Company, as
filed with the Secretary of State of Maryland on August 6, 1985, and as amended
and restated on August 12, 1985 (such Articles of Incorporation, as presently in
effect and as they shall from time to time be amended, herein called the
"Articles of Incorporation");
(b) Bylaws of the Investment Company (such Bylaws, as
presently in effect and as they shall from time to time be amended, herein
called the "Bylaws");
(c) Resolutions of the Investment Company's Board of Trustees
authorizing the appointment of BIMC and resolutions of the Investment Company's
Board of Trustees and Participation Certificate holders of the Portfolio
approving this Agreement;
(d) Resolutions of the Investment Company's Board of Trustees
authorizing the appointment of BCS Financial Services Corporation ("BCS") as the
Portfolio's administrator pursuant to the Administration Agreement between BCS
and the Investment Company dated as of February 28, 1987;
2
3
(e) The Investment Company's Registration Statement on Form
N-lA under the 1940 Act and the Securities Act of 1933, as filed with the
Securities and Exchange Commission ("SEC") (File No. 2-99584) relating to the
Investment Company's Participation Certificates and all amendments thereto;
(f) The Investment Company's Notification of Registration
filed pursuant to Section 8(a) of the 1940 Act on Form N-8A with the SEC and all
amendments thereto; and
(g) The Investment Company's most recent prospectus and
statement of additional information with respect to the Portfolio (such
prospectus and statement of additional information, as presently in effect and
all amendments and supplements thereto are herein called the "Prospectus").
The Investment Company will furnish BIMC from time to time with
copies, properly certified or authenticated, of all amendments of or supplements
to the foregoing.
3. Investment Advice. Subject to the supervision of the Investment
Company's Board of Trustees, BIMC will provide a continuous investment program
for the Portfolio, including investment research and management with respect to
all securities and investments and cash equivalents in the Portfolio. BIMC will
determine from time to time what securities and other investments will be
purchased, retained or sold by the Portfolio and will place the daily orders for
the purchase or sale of securities. BIMC will provide the services under this
Agreement in accordance with the Portfolio's investment objectives, policies and
restrictions as stated in the Prospectus and resolutions of the Investment
Company's Board of Trustees. BIMC further agrees that it:
(a) will conform with all applicable Rules and Regulations of
the SEC and will in addition conduct its activities under this Agreement in
accordance with other applicable law; BIMC will comply with policies of the
Investment Company that may be
3
4
designed to limit portfolio instruments to those which certain investors could
make directly but shall not be responsible for monitoring which investments may
from time to time be so permitted or limited but shall be entitled to rely on
instructions from the Investment Company or its agent;
(b) will not make loans to any person to purchase or carry
Investment Company Participation Certificates or make loans to the Investment
Company;
(c) will place orders pursuant to its investment
determinations for the Portfolio either directly with the issuer or with any
broker or dealer. Subject to the other provisions of this sub-paragraph, in
placing orders with brokers and dealers BIMC will attempt to obtain the best net
price and the most favorable execution of its orders. In placing orders, BIMC
will consider the experience and skill of the firm's securities traders as well
as the firm's financial responsibility and administrative efficiency. Consistent
with this obligation, when the execution and price offered by two or more
brokers or dealers are comparable, BIMC may, in its discretion, purchase and
sell portfolio securities to and from brokers and dealers who provide the
Portfolio with research advice and other services. In no instance will portfolio
securities be purchased from or sold to BCS, BIMC, or any affiliated person
thereof; and
(d) will treat confidentially and as proprietary information
of the Investment Company all records and other information relative to the
Portfolio and prior, present or potential Participation Certificate holders, and
will not use such records and information for any purpose other than performance
of its responsibilities and duties hereunder, except after prior notification to
and approval in writing by the Investment Company, which approval shall not be
unreasonably withheld and may not be withheld where BIMC may be exposed to civil
or criminal contempt proceedings for failure to comply, when requested to
divulge such information by duly constituted authorities, or when so requested
by the Investment Company.
4. Administration. Subject to the supervision of the Investment
Company's Board
4
5
of Trustees, BIMC will provide the Portfolio with the following administrative
services in accordance with the resolutions of the Investment Company's Board of
Trustees:
(a) Reconcile the Portfolio's daily cash and investment
balances with its custodian and determine the beginning cash balance available
each day for investment;
(b) Update the Portfolio's cash availability throughout the
day as required;
(c) Verify investment buy-sell trade tickets, maintain
individual ledgers for investment securities and historical tax lots for each
investment security, calculate capital gains and losses and transmit trades to
the custodian for proper settlement;
(d) Maintain daily journals with respect to the Portfolio's
investments, Participation Certificates, income and expenses;
(e) Otherwise maintain all books and records with respect to
the Portfolio's securities transactions, keep the Portfolio's books of account
and compute the net asset value, net income and capital gains (losses) of the
Portfolio;
(f) Monitor the expense accruals and calculate the various
contractual expenses of the Portfolio;
(g) Calculate daily the Portfolio's average dollar weighted
maturity, the dividend per Participation Certificate available to be declared to
Participation Certificate holders, and the yield of the Portfolio;
(h) Supply the Investment Company and its Board of Trustees
with various normal and customary reports and statistical data concerning the
Portfolio as reasonably requested by it, state insurance commissioners or their
counterparts;
5
6
(i) Prepare a monthly unaudited financial statement of the
Portfolio, which will include the following items:
(1) Schedule of Investments;
(2) Statement of Assets and Liabilities;
(3) Statement of Operations;
(4) Statement of Changes in Net Assets;
(5) Cash Statement; and a
(6) Schedule of Capital Gains and Losses;
(j) Act as liaison between the Investment Company and its
independent certified public accountants and provide them with detailed account
analyses, fiscal year summaries and other audit-related schedules as reasonably
requested in connection with the Portfolio;
(k) Pursuant to security market quotes from independent
pricing services or as otherwise permitted by the Investment Company's Board of
Trustees, calculate the amortized cost and the market values of the investments
of the Portfolio;
(1) Prepare a quarterly broker security transaction summary
and monthly security transaction listing;
(m) Prepare and file the Investment Company's semiannual
reports to the SEC on Form N-SAR;
(n) Prepare for execution by the Investment Company and file
all of the Investment Company's Federal and state tax returns and other required
tax filings as agreed to by BIMC;
(o) Assist with the preparation of the Investment Company's
annual and semi-annual reports to Participation Certificate holders, its
registration statement on
6
7
Form N-lA and other filings relating to the registration of Participation
Certificates;
(p) Monitor the Investment Company's status as a regulated
investment company under Subchapter M of the Internal Revenue Code of 1986, as
amended;
(q) Arrange to maintain the Investment Company's fidelity
bond required by the 1940 Act;
(r) Monitor the Portfolio's compliance with the amounts and
conditions of each state qualification with respect to those states in which the
Portfolio's Participation Certificates have been qualified for sale; and
(s) Have its officers available, upon reasonable notice and
at reasonable frequencies, for consultation with Trustees, officers and
employees of the Investment Company.
The Investment Company will use its best efforts to provide BIMC such
information or other assistance as BIMC may reasonably require in order to
perform these services, including, but not limited to, information in the
possession of any other Investment Company service provider.
5. Services Not Exclusive. The services rendered by BIMC hereunder are
not to be deemed exclusive, and BIMC shall be free to render similar services to
others so long as its services under this Agreement are not impaired thereby.
6. Books and Records. In compliance with the requirements of Rule
3la-3 under the 1940 Act, BIMC hereby agrees that all records which it maintains
for the Portfolio are the property of the Investment Company and further agrees
to surrender promptly to the Investment Company any of such records upon the
Investment Company's request. BIMC further agrees to preserve for the periods
prescribed by Rule 31a-2 under the 1940 Act the records required to be
maintained by Rule 31a-1 under the 1940 Act with respect to the services
provided hereunder.
7
8
7. Expenses. During the term of this Agreement, BIMC will pay all
expenses incurred by it in connection with its activities under this Agreement
(other than the cost of securities, commodities and other investments (including
brokerage commissions and other transaction charges, if any) purchased or sold
for the Portfolio and fees and expenses related to qualifying or registering
Participation Certificates for sale) and the Investment Company will pay
expenses properly incurred by it or on its behalf. In addition if, in any fiscal
year, the expenses (as defined under the securities regulations of an applicable
state) borne by the Portfolio exceed the applicable expense limitations imposed
by the securities regulations in any state in which Participation Certificates
of the Portfolio are registered or qualified for sale to the public, BIMC will
reimburse the Portfolio for any excess to the extent required by such
regulations. Unless otherwise required by law, such reimbursement would be
accrued and paid on the same basis that the advisory and service fees are
accrued and paid by the Portfolio. To the knowledge of the Investment Company,
the expense limitations in effect on the date of this Agreement are no more
restrictive than one and one-half percent (1.5%) of the Portfolio's average net
assets up to $30 million and one percent (1%) of its respective average annual
net assets in excess of $30 million.
8. Compensation. For the services provided and the expenses assumed
pursuant to this Agreement, effective as of the date hereof, the Investment
Company will pay and BIMC will accept as full compensation therefore a fee,
computed daily at an annual rate of .20% of the first $250 million of the
portfolio's average net assets, plus .15% of the next $250 million of its
average net assets, plus .12% of the next $250 million of its average net
assets, plus .10% of the next $250 million of its average net assets, plus .08%
of its average net assets over $1 billion. The fee will be paid monthly and will
be reduced by the amount necessary to reduce the Portfolio's ordinary operating
expenses so that the Portfolio's ordinary operating expenses do not exceed 0.30
of one percent (.30%) of the Portfolio's average net assets for each fiscal year
during the term of this Agreement.
8
9
9. Limitation of Liability. BIMC and its delegates shall not be liable
for any error of judgment or mistake of law or for any loss suffered by the
Investment Company in connection with the performance of this Agreement, or in
connection with any action or inaction by BIMC or its delegates in reliance on
instructions received by BIMC or its delegates from the Investment Company
(including but not limited to instructions pursuant to Paragraph 3(a) hereof) or
from a person reasonably believed by BIMC or its delegates to be authorized to
act on behalf of the Investment Company, except a liability resulting from a
breach of fiduciary duty with respect to the receipt of compensation for
services or a loss resulting from willful misfeasance, bad faith or negligence
on the part of BIMC in the performance of its duties or from reckless disregard
by it of its obligations and duties under this Agreement. BIMC and its delegates
may assume that instructions provided to it are consistent with the Investment
Company's organizational documents and resolutions or proceedings of the
Investment Company's Board of Trustees and Participation Certificate holders.
Notwithstanding anything else in this Agreement to the contrary, with respect to
administrative services neither BIMC nor its affiliates will be liable to the
Investment Company or the Portfolio for any consequential, special or indirect
losses or damages which the Investment Company or the Portfolio may incur or
suffer by or as a consequence of BIMC's or any affiliate's performance of such
services, whether or not the likelihood of such losses or damages was known by
BIMC or its affiliates.
10. Duration and Termination. This Agreement, unless sooner terminated
as provided herein, shall continue in effect until one year from the date
hereof. Thereafter, if not terminated, this Agreement shall continue in effect
for successive annual periods each ending on the anniversary date hereof,
provided such continuance is specifically approved at least annually (a) by the
vote of a majority of those members of the Investment Company's Board of
Trustees who are not interested persons of any party to this Agreement, cast in
person at a meeting called for the purpose of voting on such approval, and (b)
by the Investment Company's Board of Trustees or by a vote of a majority of the
outstanding voting securities of the Portfolio.
9
10
Notwithstanding the foregoing, this Agreement may be terminated at any
time, without the payment of any penalty, by the Investment Company (by vote of
the Investment Company's Board of Trustees or by vote of a majority of the
outstanding voting securities of the Portfolio) or by BIMC, on sixty (60) days'
written notice. This Agreement will immediately terminate in the event of its
assignment. (As used in this Agreement, the terms "majority of the outstanding
voting securities," "interested persons" and "assignment" shall have the same
meaning as such terms in the 1940 Act.)
11. Amendment of this Agreement. No provision of this Agreement may be
changed, waived, discharged or terminated orally, but only by an instrument in
writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought. No amendment of this Agreement shall be
effective until approved by vote of a majority of the outstanding voting
securities of the Portfolio.
12. Miscellaneous. The captions in this Agreement are included for
convenience of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect. 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. This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors and shall be
governed by Delaware law.
10
11
IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be executed by their officers designated below as of the day and year first
above written.
Attest: PLAN INVESTMENT FUND, INC.,
Xxxxxxx X. Xxxx on behalf of its Government/
------------------- REPO Portfolio
By: Xxxxxx X. Xxxxx
-----------------------------
Title: President and Chief
Executive Officer
Attest: BLACKROCK INSTITUTIONAL
Xxx Xxxxxxxx MANAGEMENT CORPORATION
-------------------
By: Xxxxx Xxxxxxxxxxx
-----------------------------
Title: President
11
12
PLAN INVESTMENT FUND, INC.
GOVERNMENT/REPO PORTFOLIO
BlackRock Institutional Management Corporation ("BIMC") and BCS
Financial Services Corporation ("BCS") hereby enter into a voluntary
fee waiver agreement with regards to the Government/REPO Portfolio of
Plan Investment Fund, Inc. This agreement shall continue until
termination by either party upon ninety (90) days written notice. BIMC
and BCS agree to the following:
(1) BIMC and BCS will voluntarily reduce the fees otherwise payable
to them by the Government/REPO Portfolio to the extent necessary
to reduce the ordinary operating expenses of the Government/REPO
Portfolio so that they do not exceed 0.15 of one percent (0.15%)
of the Government/REPO Portfolio's average net assets for each
fiscal year. Under this voluntary agreement, the maximum
investment advisor fee to be charged to the portfolio will be
0.10 of one percent (0.10%) and the maximum administrator fee to
be charged to the portfolio will be 0.05 of one percent (0.05%).
Fees will be allocated proportionally, two thirds to BIMC and one
third to BCS, after all other ordinary operating expenses have
been paid.
(2) Until otherwise agreed to in writing, BIMC and BCS further agree
to reduce the fees otherwise payable to them by the
Government/REPO Portfolio to the extent necessary to reduce the
ordinary operating expenses of the Government/REPO Portfolio so
that they do not exceed 0.10 of one percent (0.10%) of the
Government/REPO Portfolio's average net assets for each fiscal
year.
(3) BCS will pay the organizational expenses directly associated with
the establishment of the Government/REPO Portfolio. The portfolio
will not
12
13
be legally obligated to repay these organizational expenses;
however, the waiver of fees payable to BCS will be reduced by a
dollar amount equal to the organizational expenses paid by BCS.
(4) Operating expenses will be allocated as follows under the
voluntary 0.10 of one percent (0.10%) expenses limitation
agreement:
BIMC BCS BCS (Waiver
Advisory + Admin. + Reduction) + Other =Total
-------- -------- ----------- ------- ------
Until BCS waiver
reduction equals
organizational costs: .02% .02% .03% .03% .10%
BIMC BCS BCS (Waiver
Advisory + Admin. + Reduction) + Other =Total
-------- -------- ----------- ------- ------
After BCS waiver
reduction equals
organizational costs: .05% .02% .00% .03% .10%
13
14
(5) BIMC further agrees that, in the event the BCS waiver reduction
by the Government/REPO Portfolio is less than the full amount of
the organizational expenses paid by BCS, BIMC will allow BCS to
suspend its voluntary waivers of Money Market Portfolio fees
until it has received an amount equal to one half of the
difference between actual waiver reductions and organizational
expenses paid by BCS. Under this agreement, BIMC will increase
its voluntary waivers of Money Market Portfolio fees in an amount
equal to the suspended BCS fee waivers.
BlackRock Institutional Management Corporation
By: Xxxxx Xxxxxxxxxxx Date: 4/24/01
--------------------------- --------------
Its: President
BCS Financial Services Corporation
By: Xxxxxx X. Xxxxx Date: 4/24/01
--------------------------- --------------
Its: President and Chief Executive Officer
--------------------------------------
14
