DELAWARE GROUP ADVISER FUNDS, INC.
CORPORATE INCOME FUND
INVESTMENT MANAGEMENT AGREEMENT
AGREEMENT, made by and between DELAWARE GROUP ADVISER FUNDS, INC.,
Maryland corporation ("Fund") on behalf of the CORPORATE INCOME FUND
(Portfolio"), and DELAWARE MANAGEMENT COMPANY, INC., a Delaware corporation
("Investment Manager").
W I T N E S S E T H:
WHEREAS, the Fund has been organized and operates as an investment
company registered under the Investment Company Act of 1940 and is currently
comprised of six portfolios, including the Portfolio; as a separate series of
the Fund, each portfolio engages in the business of investing and reinvesting
its assets in securities, and further
WHEREAS, the Investment Manager is a registered investment adviser
under the Investment Advisers Act of 1940 and engages in the business of
providing investment management services; and further
WHEREAS, the Board of Directors of the Fund approved a restructuring
("Restructuring") of the Fund and each of its portfolios for the purpose of
integrating the Fund into the Delaware Group of Funds; and further
WHEREAS, as part of the Restructuring, the names of the Fund and the
Portfolio were changed from the Lincoln Advisor Funds, Inc. and Lincoln
Corporate Income Portfolio to,
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respectively, Delaware Group Adviser Funds, Inc. and Corporate Income Fund; and
the Investment Manager was selected to replace Lincoln Investment Management,
Inc. (formerly Lincoln National Investment Management Company), which served as
investment manager for the Portfolio under an Investment Advisory Agreement
dated as of the 25th of October, 1993; and further
WHEREAS, in connection with the changes in investment manager, the
Fund on behalf of the Portfolio and the Investment Manager desire to enter into
this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, and each of the parties hereto intending to be legally bound, it is
agreed as follows:
1. The Fund hereby employs the Investment Manager to manage the
investment and reinvestment of the Portfolio's assets and to administer its
affairs, subject to the direction of the Fund's Board of Directors and officers
of the Fund for the period and on the terms hereinafter set forth. The
Investment Manager hereby accepts such employment and agrees during such period
to render the services and assume the obligations herein set forth for the
compensation herein provided. The Investment Manager shall for all purposes
herein be deemed to be an independent contractor, and shall, unless otherwise
expressly provided and authorized, have no authority to act for or represent the
Fund in any way, or in any way be deemed an agent of the Fund. The Investment
Manager shall regularly make decisions as to what securities and other
instruments to purchase and sell on behalf of the Portfolio and shall effect the
purchase and sale of such investments in furtherance of the Portfolio's
objectives and policies and shall furnish the Board of Directors of the Fund
with such information and reports regarding the Portfolio's investments as the
Investment Manager deems appropriate or as the Directors of the Fund may
reasonably request.
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2. The Fund shall conduct its own business and affairs and shall bear
the expenses and salaries necessary and incidental thereto including, but not in
limitation of the foregoing, the costs incurred in: the maintenance of its
corporate existence; the maintenance of its own books, records and procedures;
dealing with its own shareholders; the payment of dividends; transfer of stock,
including issuance, redemption and repurchase of shares; preparation of share
certificates; reports and notices to shareholders; calling and holding of
shareholders' meetings; miscellaneous office expenses; brokerage commissions;
custodian fees; legal and accounting fees; taxes; and federal and state
registration fees. Directors, officers and employees of the Investment Manager
may be directors, officers and employees of any of the funds (including the
Fund) of which Delaware Management Company, Inc. is investment manager.
Directors, officers and employees of the Investment Manager who are directors,
officers and/or employees of these funds shall not receive any compensation from
the funds for acting in such dual capacity.
In the conduct of the respective businesses of the parties hereto and
in the performance of this Agreement, the Fund and Investment Manager may share
facilities common to each, with appropriate proration of expenses between them.
3. (a) Subject to the primary objective of obtaining the best
available prices and execution, the Investment Manager will place orders for the
purchase and sale of portfolio securities and other instruments with such
broker/dealers selected who provide statistical, factual and financial
information and services to the Fund, to the Investment Manager, to any
Sub-Adviser, as defined in Paragraph 5 hereof, or to any other fund for which
the Investment Manager or any such Sub-Adviser provides investment advisory
services and/or with broker/dealers who sell shares of the Fund or who sell
shares of any other fund for which the Investment Manager or any such
Sub-Adviser provides
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investment advisory services. Broker/dealers who sell shares of the funds of
which Delaware Management Company, Inc. is investment manager, shall only
receive orders for the purchase or sale of portfolio securities to the extent
that the placing of such orders is in compliance with the Rules of the
Securities and Exchange Commission and the National Association of Securities
Dealers, Inc.
(b) Notwithstanding the provisions of subparagraph (a) above and
subject to such policies and procedures as may be adopted by the Board of
Directors and officers of the Fund, the Investment Manager may ask the Fund and
the Fund may agree to pay a member of an exchange, broker or dealer an amount of
commission for effecting a securities transaction in excess of the amount of
commission another member of an exchange, broker or dealer would have charged
for effecting that transaction, in such instances where the Fund and the
Investment Manager have determined in good faith that such amount of commission
was reasonable in relation to the value of the brokerage and research services
provided by such member, broker or dealer, viewed in terms of either that
particular transaction or the Investment Manager's overall responsibilities with
respect to the Fund and to other funds and other advisory accounts for which the
Investment Manager or any Sub-Adviser, as defined in Paragraph 5 hereof,
exercises investment discretion.
4. As compensation for the services to be rendered to the Fund by the
Investment Manager under the provisions of this Agreement, the Fund shall pay to
the Investment Manager monthly from the Portfolio's assets, a fee (at an annual
rate) equal to .30% of the average daily net assets of the Portfolio during the
month.
If this Agreement is terminated prior to the end of any calendar
month, the management fee shall be prorated for the portion of any month in
which this Agreement is in effect according to the proportion which the number
of calendar days, during which the Agreement is in effect, bears to the
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number of calendar days in the month, and shall be payable within 10 days after
the date of termination.
5. The Investment Manager may, at its expense, select and contract
with one or more investment advisers registered under the Investment Advisers
Act of 1940 (the "Sub-Adviser") to perform some or all of the services for the
Portfolio for which it is responsible under this Agreement. The Investment
Manager will compensate any Sub-Adviser for its services to the Portfolio. The
Investment Manager may terminate the services of any Sub-Adviser at any time in
its sole discretion, and shall at such time assume the responsibilities of such
Sub-Adviser unless and until a successor Sub-Adviser is selected and the
requisite approval of the Portfolio's shareholders is obtained. The Investment
Manager will continue to have responsibility for all advisory services furnished
by any Sub-Adviser.
6. The services to be rendered by the Investment Manager to the Fund
under the provisions of this Agreement are not to be deemed to be exclusive, and
the Investment Manager shall be free to render similar or different services to
others so long as its ability to render the services provided for in this
Agreement shall not be impaired thereby.
7. The Investment Manager, its directors, officers, employees, agents
and shareholders may engage in other businesses, may render investment advisory
services to other investment companies, or to any other corporation,
association, firm or individual, and may render underwriting services to the
Fund or to any other investment company, corporation, association, firm or
individual.
8. In the absence of willful misfeasance, bad faith, gross
negligence, or a reckless disregard of the performance of its duties as the
Investment Manager to the Fund, the Investment Manager shall not be subject to
liability to the Fund or to any shareholder of the Fund for any action or
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omission in the course of, or connected with, rendering services hereunder or
for any losses that may be sustained in the purchase, holding or sale of any
security, or otherwise.
9. This Agreement shall be executed and become effective as of the
date written below if approved by the vote of a majority of the outstanding
voting securities of the Portfolio. It shall continue in effect for a period of
two years and may be renewed thereafter only so long as such renewal and
continuance is specifically approved at least annually by the Board of Directors
or by the vote of a majority of the outstanding voting securities of the
Portfolio and only if the terms and the renewal hereof have been approved by the
vote of a majority of the Directors of the Fund 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 such approval. Notwithstanding the foregoing, this
Agreement may be terminated by the Fund at any time, without the payment of a
penalty, on sixty days' written notice to the Investment Manager of the Fund's
intention to do so, pursuant to action by the Board of Directors of the Fund or
pursuant to the vote of a majority of the outstanding voting securities of the
Portfolio. The Investment Manager may terminate this Agreement at any time,
without the payment of a penalty, on sixty days' written notice to the Fund of
its intention to do so. Upon termination of this Agreement, the obligations of
all the parties hereunder shall cease and terminate as of the date of such
termination, except for any obligation to respond for a breach of this Agreement
committed prior to such termination, and except for the obligation of the Fund
to pay to the Investment Manager the fee provided in Paragraph 4 hereof,
prorated to the date of termination. This Agreement shall automatically
terminate in the event of its assignment.
10. This Agreement shall extend to and bind the heirs, executors,
administrators and successors of the parties hereto.
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11. For the purposes of this Agreement, the terms "vote of a majority
of the outstanding voting securities"; "interested persons"; and "assignment"
shall have the meaning defined in the Investment Company Act of 1940.
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IN WITNESS WHEREOF, the parties hereto have caused their corporate
seals to be affixed and duly attested and their presents to be signed by their
duly authorized officers as of the 4th day of May, 1996.
Attest: DELAWARE ADVISER FUNDS, INC. for the
CORPORATE INCOME FUND
/s/Xxxx X. Xxxx By: /s/Xxxxx X. Xxxxxx
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Xxxx X. Xxxx Xxxxx X. Xxxxxx
Vice President Senior Vice President/Chief Administrative
Assistant Secretary Officer/Chief Financial Officer
Attest: DELAWARE MANAGEMENT COMPANY, INC.
/s/Xxxx X. Xxxxxx By: /s/Xxxxx X. Xxxxx
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Xxxx X. Xxxxxx Xxxxx X. Xxxxx
Vice President Chairman, President, Chief Executive Officer,
Assistant Secretary Chief Investment Officer
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