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EXHIBIT 99.B5
INVESTMENT MANAGEMENT AGREEMENT
AGREEMENT made this 4th day of January, 1996, by and between
XXXXXX GLOBAL INCOME FUND, a Massachusetts business trust (the
"Fund"), and XXXXXX FINANCIAL SERVICES, INC., a Delaware
corporation (the "Adviser").
WHEREAS, the Fund is an open-end management investment
company registered under the Investment Company Act of 1940, the
shares of beneficial interest ("Shares") of which are registered
under the Securities Act of 1933;
WHEREAS, the Fund is authorized to issue Shares in separate
series or portfolios with each representing the interests in a
separate portfolio of securities and other assets;
WHEREAS, the Fund currently offers or intends to offer Shares
in one portfolio, the Initial Portfolio, together with any other
Fund portfolios which may be established later and served by the
Adviser hereunder, being herein referred to collectively as the
"Portfolios" and individually referred to as a "Portfolio"; and
WHEREAS, the Fund desires at this time to retain the Adviser
to render investment advisory and management services to the
Initial Portfolio, and the Adviser is willing to render such
services;
NOW THEREFORE, in consideration of the mutual covenants
hereinafter contained, it is hereby agreed by and between the
parties hereto as follows:
1. The Fund hereby employs the Adviser to act as the investment
adviser for the Initial Portfolio and other Portfolios hereunder
and to manage the investment and reinvestment of the assets of
each such Portfolio in accordance with the applicable investment
objectives and policies and limitations, and to administer the
affairs of each such Portfolio to the extent requested by and
subject to the supervision of the Board of Trustees of the Fund
for the period and upon the terms herein set forth, and to place
orders for the purchase or sale of portfolio securities for the
Fund's account with brokers or dealers selected by it; and, in
connection therewith, the Adviser is authorized as the agent of
the Fund to give instructions to the Custodian of the Fund as to
the deliveries of securities and payments of cash for the account
of the Fund. In connection with the
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selection of such brokers or dealers and the placing of such
orders, the Adviser is directed to seek for the Fund best
execution of orders. Subject to such policies as the Board of
Trustees of the Fund determines, the Adviser shall not be deemed
to have acted unlawfully or to have breached any duty, created by
this Agreement or otherwise, solely by reason of its having caused
the Fund to pay a broker or dealer an amount of commission for
effecting a securities transaction in excess of the amount of
commission another broker or dealer would have charged for
effecting that transaction, if the Adviser 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
broker or dealer viewed in terms of either that particular
transaction or the Adviser's overall responsibilities with respect
to the clients of the Adviser as to which the Adviser exercises
investment discretion. The Fund recognizes that all research
services and research that the Adviser receives or generates are
available for all clients, and that the Fund and other clients may
benefit thereby. The investment of funds shall be subject to all
applicable restrictions of the Agreement and Declaration of Trust
and By-Laws of the Fund as may from time to time be in force.
The Adviser accepts such employment and agrees during such
period to render such services, to furnish office facilities and
equipment and clerical, bookkeeping and administrative services
for the Fund, to permit any of its officers or employees to serve
without compensation as trustees or officers of the Fund if
elected to such positions and to assume the obligations herein set
forth for the compensation herein provided. The Adviser shall for
all purposes herein provided be deemed to be an independent
contractor and, unless otherwise expressly provided or authorized,
shall have no authority to act for or represent the Fund in any
way or otherwise be deemed an agent of the Fund. It is understood
and agreed that the Adviser, by separate agreements with the Fund,
may also serve the Fund in other capacities.
2. In the event that the Fund establishes one or more portfolios
other than the Initial Portfolio with respect to which it desires
to retain the Adviser to render investment advisory and management
services hereunder, it shall notify the Adviser in writing. If the
Adviser is willing to render such services, it shall notify the
Fund in writing whereupon such portfolio or portfolios shall
become a Portfolio or Portfolios hereunder.
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3. For the services and facilities described in Section 1, the
Fund will pay to the Adviser at the end of each calendar month, an
investment management fee for each Portfolio computed by applying
the following annual rates to the applicable average daily net
assets of the Portfolio:
Applicable Average
Daily Net Assets
(Thousands) Annual Rate
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$0 - $ 250,000 .75 of 1%
$ 250,000 - $ 1,000,000 .72 of 1%
$ 1,000,000 - $ 2,500,000 .70 of 1%
$ 2,500,000 - $ 5,000,000 .68 of 1%
$ 5,000,000 - $ 7,500,000 .65 of 1%
$ 7,500,000 - $10,000,000 .64 of 1%
$10,000,000 - $12,500,000 .63 of 1%
Over $12,500,000 .62 of 1%
The fee as computed above shall be computed separately for,
and charged as an expense of, each Portfolio based upon the
average daily net assets of such Portfolio. For the month and year
in which this Agreement becomes effective or terminates, there
shall be an appropriate proration on the basis of the number of
days that the Agreement is in effect during the month and year,
respectively.
4. The services of the Adviser to the Fund under this Agreement
are not to be deemed exclusive, and the Adviser shall be free to
render similar services or other services to others so long as its
services hereunder are not impaired thereby.
5. In addition to the fee of the Adviser, the Fund shall assume
and pay any expenses for services rendered by a custodian for the
safekeeping of the Fund's securities or other property, for
keeping its books of account, for any other charges of the
custodian, and for calculating the net asset value of the Fund as
provided in the prospectus of the Fund. The Adviser shall not be
required to pay and the Fund shall assume and pay the charges and
expenses of its operations, including compensation of the trustees
(other than those affiliated with the Adviser), charges and
expenses of independent auditors, of legal counsel, of any
transfer or dividend disbursing agent, and of any registrar of the
Fund, costs of acquiring and disposing of portfolio securities,
interest, if any, on obligations incurred by the Fund, costs
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of share certificates and of reports, membership dues in the
Investment Company Institute or any similar organization, costs of
reports and notices to shareholders, other like miscellaneous
expenses and all taxes and fees payable to federal, state or other
governmental agencies on account of the registration of securities
issued by the Fund, filing of trust documents or otherwise. The
Fund shall not pay or incur any obligation for any expenses for
which the Fund intends to seek reimbursement from the Adviser as
herein provided without first obtaining the written approval of
the Adviser. The Adviser shall arrange, if desired by the Fund,
for officers or employees of the Adviser to serve, without
compensation from the Fund, as trustees, officers or agents of the
Fund if duly elected or appointed to such positions and subject to
their individual consent and to any limitations imposed by law.
If expenses borne by the Fund for those Portfolios which the
Adviser manages in any fiscal year (including the Adviser's fee,
but excluding interest, taxes, fees incurred in acquiring and
disposing of portfolio securities, distribution services fees,
extraordinary expenses and any other expenses excludable under
state securities law limitations) exceed any applicable limitation
arising under state securities laws, the Adviser will reduce its
fee or reimburse the Fund for any excess to the extent required by
such state securities laws. If for any month the expenses of the
Fund properly chargeable to the income account shall exceed 1/12
of the percentage of average net assets allowable as expenses, the
payment to the Adviser for that month shall be reduced and if
necessary the Adviser shall make a refund payment to the Fund so
that the total net expense will not exceed such percentage. As of
the end of the Fund's fiscal year, however, the foregoing
computations and payments shall be readjusted so that the
aggregate compensation payable to the Adviser for the year is
equal to the percentage calculated in accordance with Section 3
hereof of the average net asset value as determined as described
herein throughout the fiscal year, diminished to the extent
necessary so that the total of the aforementioned expense items of
the Fund shall not exceed the expense limitation. The aggregate of
repayments, if any, by the Adviser to the Fund for the year shall
be the amount necessary to limit the said net expense to said
percentage in accordance with the foregoing.
The net asset value for each Portfolio shall be calculated in
accordance with the provisions of the Fund's prospectus or as the
trustees may determine in accordance with the provisions of the
Investment Company Act of 1940. On each day when net asset value
is not calculated, the net asset value of a Portfolio shall be
deemed to be the net asset value of such Portfolio as of the close
of business on
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the last day on which such calculation was made for the
purpose of the foregoing computations.
6. Subject to applicable statutes and regulations, it is
understood that trustees, officers or agents of the Fund are or
may be interested in the Adviser as officers, directors, agents,
shareholders or otherwise, and that the officers, directors,
shareholders and agents of the Adviser may be interested in the
Fund otherwise than as a trustee, officer or agent.
7. The Adviser shall not be liable for any error of judgment or of
law or for any loss suffered by the Fund in connection with the
matters to which this Agreement relates, except loss resulting
from willful misfeasance, bad faith or gross negligence on the
part of the Adviser in the performance of its obligations and
duties or by reason of its reckless disregard of its obligations
and duties under this Agreement.
8. This Agreement shall become effective with respect to the
Initial Portfolio on the date hereof and shall remain in full
force until March 1, 1996, unless sooner terminated as hereinafter
provided. This Agreement shall continue in force from year to year
thereafter with respect to each Portfolio, but only as long as
such continuance is specifically approved for each Portfolio at
least annually in the manner required by the Investment Company
Act of 1940 and the rules and regulations thereunder; provided,
however, that if the continuation of this Agreement is not
approved for a Portfolio, the Adviser may continue to serve in
such capacity for such Portfolio in the manner and to the extent
permitted by the Investment Company Act of 1940 and the rules and
regulations thereunder.
This Agreement shall automatically terminate in the event of
its assignment and may be terminated at any time without the
payment of any penalty by the Fund or by the Adviser on sixty (60)
days written notice to the other party. The Fund may effect
termination with respect to any Portfolio by action of the Board
of Trustees or by vote of a majority of the outstanding voting
securities of such Portfolio.
This Agreement may be terminated with respect to any
Portfolio at any time without the payment of any penalty by the
Board of Trustees or by vote of a majority of the outstanding
voting securities of such Portfolio in the event that it shall
have been established by a court of competent jurisdiction that
the Adviser or any officer or director of the Adviser has taken
any action which results in a breach of the covenants of the
Adviser set forth herein.
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The terms "assignment" and "vote of a majority of the
outstanding voting securities" shall have the meanings set forth
in the Investment Company Act of 1940 and the rules and
regulations thereunder.
Termination of this Agreement shall not affect the right of
the Adviser to receive payments on any unpaid balance of the
compensation described in Section 3 earned prior to such
termination.
9. If any provision of this Agreement shall be held or made
invalid by a court decision, statute, rule or otherwise, the
remainder shall not be thereby affected.
10. Any notice under this Agreement shall be in writing, addressed
and delivered or mailed, postage prepaid, to the other party at
such address as such other party may designate for the receipt of
such notice.
11. All parties hereto are expressly put on notice of the Fund's
Agreement and Declaration of Trust and all amendments thereto, all
of which are on file with the Secretary of The Commonwealth of
Massachusetts, and the limitation of shareholder and trustee
liability contained therein. This Agreement has been executed by
and on behalf of the Fund by its representatives as such
representatives and not individually, and the obligations of the
Fund hereunder are not binding upon any of the trustees, officers,
or shareholders of the Fund individually but are binding upon only
the assets and property of the Fund. With respect to any claim by
the Adviser for recovery of that portion of the investment
management fee (or any other liability of the Fund arising
hereunder) allocated to a particular Portfolio, whether in
accordance with the express terms hereof or otherwise, the Adviser
shall have recourse solely against the assets of that Portfolio to
satisfy such claim and shall have no recourse against the assets
of any other Portfolio for such purpose.
12. This Agreement shall be construed in accordance with
applicable federal law and (except as to Section 11 hereof which
shall be construed in accordance with the laws of The Commonwealth
of Massachusetts) the laws of the State of Illinois.
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13. This Agreement is the entire contract between the parties
relating to the subject matter hereof and supersedes all prior
agreements between the parties relating to the subject matter
hereof.
IN WITNESS WHEREOF, the Fund and the Adviser have caused this
Agreement to be executed as of the day and year first above
written.
XXXXXX GLOBAL INCOME FUND
By: /s/ Xxxx X. Xxxxxx
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Title: Vice President
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ATTEST:
/s/ Xxxxxx X. Xxxxxxx
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Title: Secretary
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XXXXXX FINANCIAL SERVICES, INC.
By: /s/ Xxxxxxx Xxxxxxx
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Title: Senior Vice President
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ATTEST:
/s/ Xxxxx X. Xxxxxxxxxxx
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Title: Assistant Secretary
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