ADVISORY AND SERVICE CONTRACT
(Xxxxxxx International Fund)
THIS ADVISORY AND SERVICE CONTRACT is entered into as of December 29,
1994, by and between XXXXXXX INVESTMENTS, a Massachusetts business trust
(the 'Trust'), and XXXXXX MANAGEMENT CORPORATION, a Michigan corporation the
"Adviser."
WHEREAS, the Trust is registered and operates as an open-end
management investment company under the Investment Company Act of 1940, as
amended (the "1940 Act"); and
WHEREAS, the shares of beneficial interest of the Trust may be divided
into separate series, and the Board of Trustees of the Trust has created a
series of shares denominated as 'Xxxxxxx International Fund (the 'Fund");
and
WHEREAS, the Trust and the Adviser have previously entered into an
Advisory and Service Contract which reserves to them the right to negotiate
and execute a separate advisory and service contract with respect to a
particular series of shares of the Trust; and
WHEREAS, the Trust and the Adviser desire to enter into such a
separate agreement with respect to the Fund; and
WHEREAS, the Trust desires to avail itself of the services,
information, advice, assistance and facilities of the Adviser and to have
the Adviser perform for it various investment advisory and research services
and other management services in connection with the Fund; and
WHEREAS, the Adviser has been organized to operate as an investment
adviser and is registered under the Investment Advisers Act of 1940, as
amended, and desires to provide such investment advisory services to the
Trust;
NOW, THEREFORE, in consideration of the terms and conditions
hereinafter set forth, it is agreed as follows:
1. Employment of the Adviser. The Trust hereby engages the Adviser
to manage the investment and reinvestment of the assets of Xxxxxxx
International Fund for the period and on the terms hereinafter set forth.
The Adviser hereby accepts such engagement and agrees during such period to
render services and to assume obligations herein set forth for the
compensation herein provided. The Adviser shall, for all purposes herein,
be deemed to be an independent contractor and shall, except as expressly
provided or authorized (whether herein or otherwise), have no authority to
act for or represent the Trust in any way or otherwise be deemed an agent
of the Trust.
2. Duties of Adviser. In providing the services set forth herein,
the Adviser undertakes to afford to the Fund the advice and assistance of
the Adviser's organization in the choice of investments and to furnish for
the use of the Fund office space and all necessary office facilities,
equipment and personnel for servicing the investments of the Fund and
maintaining its organization, and to pay all promotional expenses, salaries
and fees of all officers and directors who are interested persons of the
Fund and for all clerical services relating to research, statistical and
investment work. The investment policies and all other actions of the Fund
are and shall at all times be subject to the control and direction of its
Board of Trustees. The Adviser may, at its expense, employ one or more
subadvisers. References herein to the Adviser shall include any subadviser
employed by the Adviser. The Adviser is authorized to select the brokers
or dealers that will execute the purchases and sales of securities of the
Fund. In making such selections, the Adviser is authorized to consider such
factors as it deems relevant, including the breadth of the market in the
security, the price of the security, the financial condition and execution
ability of the broker or dealer, and the reasonableness of the commissions
both for the specific transaction and on a continuing basis. The commission
paid to such broker or dealer may be higher than that which might be charged
by another broker or dealer for effecting the same transaction if a good
faith determination is made by the Adviser that such commissions are
reasonable in relation to the value of the brokerage and research services
provided, viewed in terms of either that particular transaction or the
overall responsibilities of the Adviser as to the accounts as to which it
exercises investment discretion. In making such determination, the Adviser
need not place or attempt to place a specific dollar value on such services
or on the portion of the commission reflecting such services.
3. Permissible Interests. Subject to and in accordance with the
Declaration of Trust of the Trust and the Articles of Incorporation of the
Adviser, trustees, officers, and shareholders of the Fund are, or may be or
become interested in the Adviser as directors, officers or otherwise and
directors, officers and shareholders or otherwise of the Adviser are or may
be or become interested in the Fund as trustees, officers, shareholders or
otherwise, and the Adviser may be or become interested in the Fund as
shareholder or otherwise; and the effect of any such interrelationships
shall be governed by said Declaration of Trust or Articles of Incorporation,
as the case may be, and the 1940 Act.
4. Compensation of the Adviser. For the services and facilities
to be furnished during any fiscal month by the Adviser hereunder, the Fund
shall pay the Adviser as an advisory and service fee as soon as practicable
after the last day of each month beginning with the month ending January 31,
1995, an amount equal to 1/12th of 1% of the average daily net assets of the
Trust during the applicable month.
The Adviser shall reimburse the Fund for any excess of annual
operating and management expenses, exclusive of taxes and interest but
including the Adviser's compensation, in excess of the most stringent
limitation imposed by a state regulatory agency from among those states in
which the Fund has registered its shares for sale.
5. Compensation Upon Termination. In case of termination of the
Agreement during any month, the fee for the month shall be reduced
proportionately on the basis of the number of calendar days during which it
is in effect and the fee computed upon the average daily net asset value on
the business days during which it is so in effect.
It is understood that the Fund will pay all its expenses other than
those expressly stated to be payable by the Adviser hereunder, which
expenses payable by the Trust shall include, without limitation, interest
charges, taxes, fees of trustees who are not interested persons of the Fund,
other fees and commission of every kind, expenses of issue, sale,
repurchase, or redemption of shares, expenses of registering or qualifying
shares for sale, charges of custodians (including sums as custodian and for
keeping books and similar services to the Fund), transfer agents (including
the printing and mailing of reports and notices to shareholders),
registrars, auditing and legal services, and other expenses not expressly
assumed by the Adviser under paragraph 2 hereof.
6. Status of Adviser. The services of the Adviser to the Fund are
not to be deemed to be exclusive, the Adviser being free to render services
to others and engage in other activities.
7. Limitation of Liability of Adviser.
(a) In the absence of (i) willful misfeasance, bad faith, gross
negligence, (ii) reckless disregard of obligations and duties hereunder on
the part of the Adviser, or (iii) a loss resulting from a breach of a
fiduciary duty with respect to the receipt of compensation for services (in
which case any award for damages shall be limited to period and amount set
forth in Section 36(b)(3) of the 1940 Act), the Adviser shall not be subject
to liability whatsoever to the Fund or to any shareholder of the Fund for
any error or judgment, mistake of law or any other act or omission in the
course of, or connected with, rendering services hereunder including without
limitation, for any losses that may be sustained in connection with the
purchase, holding, redemption or sale of any security on behalf of the Fund.
(b) It is agreed that the Adviser shall have no responsibility or
liability for the accuracy or completeness of the Trust's Registration
Statements under the 1940 Act or the Securities Act of 1933, except for
information supplied by the Adviser for inclusion therein.
8. Limitation of Fund's Liability. The Adviser acknowledges that
it has received notice of and accepts the limitations upon the Fund's
liability set forth in its Declaration of Trust. The Adviser agrees that
the Fund's obligations hereunder in any case shall be limited to the Fund
and its assets and that the Adviser shall not seek satisfaction of any
obligation from the shareholders of a Series nor from any Trustee, officer,
employee or agent of the Fund.
9. Purchase of Securities. The Adviser agrees that neither it nor
any of its officers or directors will take a long or short position in the
securities issued by the Fund except that it or they may purchase from the
Fund, or from a principal underwriter of the Fund, shares issued by the Fund
at the offering price in effect at the moment of such purchase.
10. Force Majeure. The Adviser shall not be liable for delays or
errors occurring by reason of circumstances beyond its control including,
but not limited to, acts of civil or military authority, national
emergencies, work stoppages, fire, flood, catastrophe, acts of God,
insurrection, war, riot or failure of communication or power supply. In the
event of equipment breakdowns beyond its control, the Adviser shall take
reasonable steps to minimize service interruptions but shall have no
liability with respect thereto.
11. Renewal, Termination and Amendment. This Agreement shall
continue in effect, unless sooner terminated as hereinafter provided, for
a period of two years from the date hereof, and indefinitely thereafter,
with respect to the Fund, if its continuance after such two-year period
shall be specifically approved at least annually by vote of the holders of
a majority of the outstanding voting securities of the Fund or by the vote
of a majority of the Trust's Trustees; and further provided that such
continuance is also approved annually by the vote of a majority of the
Trustees who are not parties to this Agreement or interested persons of the
Adviser, cast in person at a meeting called for the purpose of voting on
such approval. Except for the first two-year period, if such approval is
not obtained, this Agreement shall terminate on the date which is 15 months
from the date of the last such approval. Either party hereto may, at any
time on 60 days' prior written notice to the other, terminate this
Agreement, without the payment of any penalty, by action of its Board of
Trustees or Board of Directors, as the case may be, or by the vote of a
majority of its outstanding voting securities. This agreement shall
terminate automatically in the event of its assignment. This Agreement may
be amended at any time by the parties hereto, subject to approval by the
Trust's Board of Trustees and, if required by applicable SEC rules and
regulations, a vote of the majority of the outstanding voting securities of
any Series affected by such change.
12. Severability. if any provisions 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.
13. Applicable Law. This Agreement shall be construed in accordance
with the laws of the State of Missouri, provided however, that nothing
herein shall be construed as being inconsistent with the 1940 Act.
14. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original.
15. Definitions. The terms "vote of a majority of the outstanding
voting securities", "assigned" and "interested persons", when used herein,
shall have the respective meanings specified in the 1940 Act as now in
effect.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be signed in their behalf by their respective officers thereunto duly
authorized, and their respective seals to be hereunto affixed, all as of the
date first above written.
XXXXXXX INTERNATIONAL FUND,
a Series of XXXXXXX INVESTMENTS,
a Massachusetts business trust
By: /S/ XXXX X. XXXXXXXX
Xxxx X. Xxxxxxxx, Chairman
XXXXXX MANAGEMENT CORPORATION, a Michigan
corporation
By: /S/ XXXX X. XXXXXX
Xxxx X. Xxxxxx, President
