INVESTMENT ADVISORY AGREEMENT
AGREEMENT, dated as of the 12th day of February 2002, by and between XXXXXXXXXXX REAL ESTATE FUND, a Massachusetts
business trust (hereinafter referred to as the "Fund"), and OPPENHEIMERFUNDS, INC. (hereinafter referred to as "OFI").
WHEREAS, the Fund is an open-end, diversified management investment company registered as such with the Securities
and Exchange Commission (the "Commission") pursuant to the Investment Company Act of 1940 (the "Investment Company Act"),
and OFI is an investment adviser registered as such with the Commission under the Investment Advisers Act of 1940;
WHEREAS, the Fund desires that OFI shall act as its investment adviser pursuant to this Agreement;
NOW, THEREFORE, in consideration of the mutual promises and covenants hereinafter set forth, it is agreed by and
between the parties, as follows:
1. General Provisions:
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The Fund hereby employs OFI and OFI hereby undertakes to act as the investment adviser of the Fund and to
perform for the Fund such other duties and functions as set forth in this Agreement. OFI shall, in all matters, give to the
Fund and its Board of Trustees (the "Trustees") the benefit of its best judgement, effort, advice and recommendations and
shall, at all times conform to, and use its best efforts to enable the Fund to conform to: (i) the provisions of the
Investment Company Act and any rules or regulations thereunder; (ii) any other applicable provisions of state or Federal
law; (iii) the provisions of the Declaration of Trust and By-Laws of the Fund as amended from time to time; (iv) policies
and determinations of the Trustees; (v) the fundamental policies and investment restrictions of the Fund as reflected in the
registration statement of the Fund under the Investment Company Act or as such policies may, from time to time, be amended;
and (vi) the Prospectus and Statement of Additional Information of the Fund in effect from time to time. The appropriate
officers and employees of OFI shall be available upon reasonable notice for consultation with any of the Trustees and
officers of the Fund with respect to any matters dealing with the business and affairs of the Fund, including the valuation
of portfolio securities of the Fund which are either not registered for public sale or not traded on any securities market.
2. Investment Management:
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(a) OFI shall, subject to the direction and control by the Trustees: (i) regularly provide investment
advice and recommendations to the Company with respect to the investments, investment policies and the purchase and sale of
securities and other investments for the Fund; (ii) supervise continuously the investment program of the Fund and the
composition of its portfolio and determine what securities shall be purchased or sold by the Fund; and (iii) arrange,
subject to the provisions of paragraph 7 hereof, for the purchase and sale of securities and other investments for the Fund.
(b) Provided that the Company shall not be required to pay any compensation for services under this
Agreement other than as provided by the terms of the Agreement and subject to the provisions of paragraph 7 hereof, OFI may
obtain investment information, research or assistance from any other person, firm or corporation to supplement, update or
otherwise improve its investment management services, including entering into sub-advisory agreements with other affiliated
or unaffiliated registered investment advisors to obtain specialized services.
(c) Provided that nothing herein shall be deemed to protect OFI from willful misfeasance, bad faith or
gross negligence in the performance of its duties, or reckless disregard of its obligations and duties under this Agreement,
OFI shall not be liable for any loss sustained by reason of good faith errors or omissions in connection with any matters to
which this Agreement relates.
(d) Nothing in this Agreement shall prevent OFI or any entity controlling, controlled by or under common
control with OFI or any officer thereof from acting as investment adviser for any other person, firm or corporation or in
any way limit or restrict OFI or any of its directors, officers, stockholders or employees from buying, selling or trading
any securities or other investments for its or their own account or for the account of others for whom it or they may be
acting, provided that such activities will not adversely affect or otherwise impair the performance by OFI of its duties and
obligations under this Agreement.
3. Other Duties of OFI:
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OFI shall, at its own expense, provide and supervise the activities of all administrative and clerical
personnel as shall be required to provide effective corporate administration for the Fund, including the compilation and
maintenance of such records with respect to its operations as may reasonably be required; the preparation and filing of such
reports with respect thereto as shall be required by the Commission; composition of periodic reports with respect to
operations of the Fund for its shareholders; composition of proxy materials for meetings of the Fund's shareholders; and the
composition of such registration statements as may be required by Federal and state securities laws for continuous public
sale of Shares of the Fund. OFI shall, at its own cost and expense, also provide the Fund with adequate office space,
facilities and equipment.
4. Allocation of Expenses:
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All other costs and expenses of the Fund not expressly assumed by OFI under this Agreement, or to be paid
by the Distributor of the Shares of the Fund, shall be paid by the Fund, including, but not limited to: (i) interest, taxes
and governmental fees; (ii) brokerage commissions and other expenses incurred in acquiring or disposing of the portfolio
securities and other investments of the Fund; (iii) insurance premiums for fidelity and other coverage requisite to its
operations; (iv) compensation and expenses of its Trustees other than those affiliated with OFI; (v) legal and audit
expenses; (vi) custodian and transfer agent fees and expenses; (vii) expenses incident to the redemption of its Shares;
(viii) expenses incident to the issuance of its Shares against payment therefor by or on behalf of the subscribers thereto;
(ix) fees and expenses, other than as herein above provided, incident to the registration under Federal securities laws of
Shares of the Fund for public sale; (x) expenses of printing and mailing reports, notices and proxy materials to
shareholders of the Fund; (xi) except as noted above, all other expenses incidental to holding meetings of the Fund's
shareholders; and (xii) such extraordinary non-recurring expenses as may arise, including litigation, affecting the Fund
thereof and any legal obligation which the Fund may have to indemnify its officers and Trustees with respect thereto. Any
officers or employees of OFI (or any entity controlling, controlled by, or under common control with OFI) who also serve as
officers, Trustees or employees of the Fund shall not receive any compensation from the Fund for their services.
5. Compensation of OFI:
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The Fund agrees to pay OFI and OFI agrees to accept as full compensation for the performance of all
functions and duties on its part to be performed pursuant to the provisions hereof, a management fee computed on the
aggregate net assets of the Fund as of the close of each business day and payable monthly at the annual rate of 1.00% of
aggregate net assets.
6. Use of Name "Xxxxxxxxxxx":
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OFI hereby grants to the Fund a royalty-free, non-exclusive license to use the name "Xxxxxxxxxxx" in the
name of the Fund for the duration of this Agreement and any extensions or renewals thereof. Such license may, upon
termination of this Agreement, be terminated by OFI, in which event the Company shall promptly take whatever action may be
necessary to change its name and discontinue any further use of the name "Xxxxxxxxxxx" in the name of the Fund or otherwise.
The name "Xxxxxxxxxxx" may be used or licensed by OFI in connection with any of its activities, or licensed by OFI to any
other party.
7. Portfolio Transactions and Brokerage:
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(a) OFI (and any Sub Advisor) is authorized, in arranging the purchase and sale of the portfolio
securities and other investments of the Fund to employ or deal with such members of securities or commodities exchanges,
brokers or dealers (hereinafter "broker-dealers"), including "affiliated" broker-dealers (as that term is defined in the
Investment Company Act), as may, in its best judgment, implement the policy of the Fund to obtain, at reasonable expense,
the "best execution" (prompt and reliable execution at the most favorable security price obtainable) of the portfolio
transactions of the Fund as well as to obtain, consistent with the provisions of subparagraph (c) of this paragraph 7, the
benefit of such investment information or research as will be of significant assistance to the performance by OFI (and any
Sub Advisor) of its investment management functions.
(b) OFI (and any Sub Advisor) shall select broker-dealers to effect the portfolio transactions of the Fund
on the basis of its estimate of their ability to obtain best execution of particular and related portfolio transactions.
The abilities of a broker-dealer to obtain best execution of particular portfolio transaction(s) will be judged by OFI (or
any Sub Advisor) on the basis of all relevant factors and considerations including, insofar as feasible, the execution
capabilities required by the transaction or transactions; the ability and willingness of the broker-dealer to facilitate the
portfolio transactions of the Fund by participating therein for its own account; the importance to the Fund of speed,
efficiency or confidentiality; the broker-dealer's apparent familiarity with sources from or to whom particular securities
or other investments might be purchased or sold; as well as any other matters relevant to the selection of a broker-dealer
for particular and related transactions of the Fund.
(c) OFI (and any Sub Advisor) shall have discretion, in the interest of the Fund, to allocate brokerage
on the portfolio transactions of the Fund to broker-dealers, other than affiliated broker-dealers, qualified to obtain best
execution of such transactions who provide brokerage and/or research services (as such services are defined in Section
28(e)(3) of the Securities Exchange Act of 1934) for the Fund and/or other accounts for which OFI or its affiliates (or any
Sub Advisor) exercise "investment discretion" (as that term is defined in Section 3(a)(35) of the Securities Exchange Act of
1934) and to cause the Fund to pay such broker-dealers a commission for effecting a portfolio transaction for the Fund that
is in excess of the amount of commission another broker-dealer adequately qualified to effect such transaction would have
charged for effecting that transaction, if OFI (or any Sub Advisor) determines, in good faith, that such commission is
reasonable in relation to the value of the brokerage and/or research services provided by such broker-dealer viewed in terms
of either that particular transaction or the overall responsibilities of OFI or its affiliates (or any Sub Advisor) with
respect to accounts as to which they exercise investment discretion. In reaching such determination, OFI (or any Sub
Advisor) will not be required to place or attempt to place a specific dollar value on the brokerage and/or research services
provided or being provided by such broker-dealer. In demonstrating that such determinations were made in good faith, OFI
(and any Sub Advisor) shall be prepared to show that all commissions were allocated for purposes contemplated by this
Agreement and that the total commissions paid by the Fund over a representative period selected by the Fund's Trustees were
reasonable in relation to the benefits to the Fund.
(d) OFI (or any Sub Advisor) shall have no duty or obligation to seek advance competitive bidding for the
most favorable commission rate applicable to any particular portfolio transactions or to select any broker-dealer on the
basis of its purported or "posted" commission rate but will, to the best of its ability, endeavor to be aware of the current
level of the charges of eligible broker-dealers and to minimize the expense incurred by the Fund for effecting its portfolio
transactions to the extent consistent with the interests and policies of the Fund as established by the determinations of
the Board of Trustees of the Fund and the provisions of this paragraph 7.
(e) The Fund recognizes that an affiliated broker-dealer: (i) may act as one of the Fund's regular brokers
for the Fund so long as it is lawful for it so to act; (ii) may be a major recipient of brokerage commissions paid by the
Fund; and (iii) may effect portfolio transactions for the Fund only if the commissions, fees or other remuneration received
or to be received by it are determined in accordance with procedures contemplated by any rule, regulation or order adopted
under the Investment Company Act to be within the permissible level of such commissions.
(f) Subject to the foregoing provisions of this paragraph 7, OFI (and any Sub Advisor) may also consider
sales of Shares of the Fund, and the other funds advised by OFI and its affiliates as a factor in the selection of
broker-dealers for its portfolio transactions.
8. Duration:
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This Agreement will take effect on the date first set forth above. Unless earlier terminated pursuant to
paragraph 10 hereof, this Agreement shall remain in effect for a period of two (2) years and thereafter from year to year,
so long as such continuance shall be approved at least annually by the Fund's Board of Trustees, including the vote of the
majority of the Trustees of the Fund who are not parties to this Agreement or "interested persons" (as defined in the
Investment Company Act) of any such party, cast in person at a meeting called for the purpose of voting on such approval, or
by the holders of a "majority" (as defined in the Investment Company Act) of the outstanding voting securities of the Fund,
and by such a vote of the Fund's Board of Trustees.
9. Disclaimer of Shareholder or Trustee Liability:
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OFI understands and agrees that the obligations of the Fund under this Agreement are not binding upon any
shareholder or Trustee of the Fund personally, but bind only the Fund and the Fund's property; OFI represents that it has
notice of the provisions of the Declaration of Trust of the Fund disclaiming shareholder or Trustee liability for acts or
obligations of the Fund.
10. Termination.
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This Agreement may be terminated (i) by OFI at any time without penalty upon sixty days' written notice to
the Fund (which notice may be waived by the Fund); or (ii) by the Fund at any time without penalty upon sixty days' written
notice to OFI (which notice may be waived by OFI) provided that such termination by the Fund shall be directed or approved
by the vote of a majority of all of the Trustees of the Fund then in office or by the vote of the holders of a "majority" of
the outstanding voting securities of the Fund (as defined in the Investment Company Act).
11. Assignment or Amendment:
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This Agreement may not be amended, or the rights of OFI hereunder sold, transferred, pledged or otherwise
in any manner encumbered without the affirmative vote or written consent of the holders of the "majority" of the outstanding
voting securities of the Company. This Agreement shall automatically and immediately terminate in the event of its
"assignment," as defined in the Investment Company Act.
12. Definitions:
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The terms and provisions of the Agreement shall be interpreted and defined in a manner consistent with the
provisions and definitions contained in the Investment Company Act.
XXXXXXXXXXX REAL ESTATE FUND
Attest:_______________ By: _________________
Xxxxxx X. Xxxx
Assistant Secretary Secretary
OPPENHEIMERFUNDS, INC.
Attest: _______________ By: ___________________
Xxxxxx X. Xxxx
Assistant Secretary Senior Vice President
NIA\RealEstate\OrgzDoc\590InvestmentAdvisoryAgmt(Feb1202).doc
