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EXHIBIT (d)(ii)
GROWTH FUND
OF
THE ENTERPRISE GROUP OF FUNDS, INC.
FUND MANAGER'S AGREEMENT
THIS AGREEMENT, made the 1st day of February, 2001, is among The
Enterprise Group of Funds, Inc. (the "Fund"), a Maryland corporation,
Enterprise Capital Management, Inc., a Georgia corporation (hereinafter
referred to as the "Adviser"), and Montag & Xxxxxxxx, Inc., a Georgia
corporation (hereinafter referred to as the "Fund Manager").
BACKGROUND INFORMATION
(A) The Adviser has entered into an Investment Adviser's
Agreement dated as of September 14, 1987 with the Fund. Pursuant to the
Investment Adviser's Agreement, the Adviser has agreed to render investment
advisory and certain other management services to all of the portfolios of the
Fund, and the Fund has agreed to employ the Adviser to render such services and
to pay to the Adviser certain fees therefore. The Investment Adviser's
Agreement recognizes that the Adviser may enter into agreements with other
investment advisers who will serve as Fund Managers to the Portfolios.
(B) The parties hereto wish to enter into an agreement whereby
the Fund Manager will provide to the Growth Fund of the Fund (the "Fund")
securities investment advisory services for the Growth Fund.
WITNESSETH THAT:
In consideration of the mutual covenants herein contained, the Fund,
the Adviser and the Fund Manager agree as follows:
(1) The Fund and Adviser hereby employ the Fund Manager
to render certain investment advisory services to the Fund, as set forth herein.
The Fund Manager hereby accepts such employment and agrees to perform such
services on the terms herein set forth, and for the compensation herein
provided.
(2) The Fund Manager shall furnish the Fund advice with
respect to the investment and reinvestment of the assets of the Fund, or such
portion of the assets of the Fund as the Adviser shall specify from time to
time, in accordance with the investment objectives, restrictions and limitations
applicable to the Growth Fund which are in the Fund's most recent Registration
Statement.
(3) The Fund Manager shall perform a monthly
reconciliation of the Growth Fund to the holdings report provided by the Funds's
custodian and bring any material or significant variances regarding holdings or
valuations to the attention of the Adviser.
(4) The Fund Manager shall for all purposes herein be
deemed to be an independent contractor. The Fund Manager has no authority to act
for or represent the Fund or the Portfolio in any way except to direct
securities transactions pursuant to its investment advice hereunder. The Fund
Manager is not an agent of the Fund or the Portfolios.
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(5) It is understood that the Fund Manager does not, by
this Agreement, undertake to assume or pay any costs or expenses of the Fund or
the Portfolio.
(6)(a) The Adviser agrees to pay the Fund Manager for its
services to be furnished under this Agreement, with respect to each calendar
month after the effective date of this Agreement, on the twentieth (20th) day
after the close of each calendar month, a sum equal to 0. 025 of 1% of the
average of the daily closing net asset values of the Growth Fund managed by the
Fund Manager during such month (that is, .30 of 1% per year) for the first
($100,000,000.00) under management and a sum equal to .0208 of 1% of the average
of the daily closing net asset values for the next $100,000,000.00 to
$200,000,000.00 (that is, .25 of 1% per year) and a sum equal to .0167 of 1% of
the average of daily closing net asset values for assets in excess of
$200,000,000.00 managed by the Fund Manager during such month (that is .20 of 1%
per year).
(6)(b) The payment of all fees provided for hereunder shall
be prorated and reduced for sums payable for a period less than a full month in
the event of termination of this Agreement on a day that is not the end of a
calendar month.
(6)(c) For the purposes of this Paragraph 6, the daily
closing net asset values of the Portfolio shall be computed in the manner
specified in the Registration Statement for the computation of the value of such
net assets in connection with the determination of the net asset value of the
Growth Fund's shares.
(7) The services of the Fund Manager hereunder are not to
be deemed to be exclusive, and the Fund Manager is free to render services to
others and to engage in other activities so long as its services hereunder are
not impaired thereby. Without in any way relieving the Fund Manager of its
responsibilities hereunder, it is agreed that the Fund Manager may employ others
to furnish factual information, economic advice and/or research, and investment
recommendations, upon which its investment advice and service is furnished
hereunder.
(8) In the absence of willful misfeasance, bad faith or
gross negligence in the performance of its duties hereunder, or reckless
disregard of its obligations and duties hereunder, the Fund Manager shall not be
liable to the Fund, the Growth Fund or the Adviser or to any shareholder or
shareholders of the Fund, the Portfolio or the Adviser for any mistake of
judgment, act or omission in the course of, or connected with, the services to
be rendered by the Fund Manager hereunder; except that the Fund Manager shall be
held liable for any losses resulting from its negligent management which result
in transactional errors or omissions including, but not limited to, incorrect,
delayed or omitted trade advices arising from the Fund Manager's negligence
which result in mispricing the Portfolio; and the Portfolio Manager shall be
obligated to make the Portfolio whole and absorb related transfer agent costs
which result from the transaction.
(9) The Fund Manager will not take, and it will take
necessary steps to prevent its officers and directors from taking, at any time,
a short position in any shares of any holdings of any Portfolio of the Fund. The
Fund Manager also will cooperate with the Fund in adopting a written policy
prohibiting xxxxxxx xxxxxxx with respect to Fund Portfolio transactions insofar
as such transactions may relate to the Fund Manager.
(10) In connection with the management of the investment
and reinvestment of the assets of the Growth Fund, the Fund Manager is
authorized to select the brokers or dealers that
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will execute purchase and sale transactions for the Growth Fund, and is
directed to use its best efforts to obtain the best available price and most
favorable execution with respect to such purchases and sales of portfolio
securities for the Fund. Subject to this primary requirement, and maintaining
as its first consideration the benefits for the Growth Fund and its
shareholders, the Fund Manager shall have the right, subject to the approval of
the Board of Directors of the Fund and of the Adviser, to follow a policy of
selecting brokers and dealers who furnish statistical research and other
services to the Growth Fund, the Adviser, or the Fund Manager and, subject to
the Conduct Rules of the National Association of Securities Dealers, Inc., to
select brokers and dealers who sell shares of Portfolios of the Fund.
(11) The Fund may terminate this Agreement by thirty (30)
days written notice to the Adviser and the Fund Manager at any time, without the
payment of any penalty, by vote of the Fund's Board of Directors, or by vote of
a majority of its outstanding voting securities. The Adviser may terminate this
Agreement by thirty (30) days written notice to the Fund Manager and the Fund
Manager may terminate this Agreement by thirty (30) days written notice to the
Adviser, without the payment of any penalty. This Agreement shall immediately
terminate in the event of its assignment, unless an order is issued by the
Securities and Exchange Commission conditionally or unconditionally exempting
such assignment from the provision of Section 15 (a) of the Investment Company
Act of 1940, in which event this Agreement shall remain in full force and
effect.
(12) Subject to prior termination as provided above, this
Agreement shall continue in force from the date of execution until February 1,
2002 and from year to year thereafter if its continuance after said date: (1) is
specifically approved on or before said date and at least annually thereafter by
vote of the Board of Directors of the Fund, including a majority of those
directors who are not parties to this Agreement of interested persons of any
such party, or by vote of a majority of the outstanding voting securities of the
Fund, and (2) is specifically approved at least annually by the vote of a
majority of Directors of the Fund who are not parties to this Agreement or
interested persons of any such party cast in person at a meeting called for the
purpose of voting on such approval.
(13) The Adviser shall indemnify and hold harmless the
Fund Manager, its officers and directors and each person, if any, who controls
the Fund Manager within the meaning of Section 15 of the Securities Act of 1933
(any and all such persons shall be referred to as "Indemnified Party"), against
any loss, liability, damage or expense (including the reasonable cost of
investigating or defending any alleged loss, liability, damages or expense and
reasonable counsel fees incurred in connection therewith), arising by reason of
any matter to which this Fund Manager's Agreement relates. However, in no case
(i) is this indemnity to be deemed to protect any particular Indemnified Party
against any liability to which such Indemnified Party would otherwise be subject
by reason of willful misfeasance, bad faith or gross negligence in the
performance of its duties or by reason of reckless disregard of its obligations
and duties under this Fund Manager's Agreement or (ii) is the Adviser to be
liable under this indemnity with respect to any claim made against any
particular Indemnified Party unless such Indemnified Party shall have notified
the Adviser in writing within a reasonable time after the summons or other first
legal process giving information of the nature of the claim shall have been
served upon the Fund Manager or such controlling persons.
The Fund Manager shall indemnify and hold harmless the Adviser and
each of its directors and officers and each person if any who controls the
Adviser within the meaning of Section 15 of the Securities Act of 1933, against
any loss, liability, damage or expense
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described in the foregoing indemnity, but only with respect to the Fund
Manager's willful misfeasance, bad faith or gross negligence in the performance
of its duties under this Fund Manager's Agreement. In case any action shall be
brought against the Adviser or any person so indemnified, in respect of which
indemnity may be sought against the Fund Manager, the Fund Manager shall have
the rights and duties given to the Adviser, and the Adviser and each person so
indemnified shall have the rights and duties given to the Fund Manager by the
provisions of subsection (i) and (ii) of this Paragraph 13.
(14) Except as otherwise provided in Paragraph 13 hereof
and as may be required under applicable federal law, this Fund Manager's
Agreement shall be governed by the laws of the State of Georgia.
(15) The Fund Manager agrees to notify the parties within
a reasonable period of time regarding a material change in the membership of the
Fund Manager.
(16) The terms "vote of a majority of the outstanding
voting securities," "assignment" and "interested persons," when used herein,
shall have the respective meanings specified in the Investment Company Act of
1940 as now in effect or as hereafter amended.
(17) Unless otherwise permitted, all notices, instructions
and advice with respect to security transactions or any other matters
contemplated by this Agreement shall be deemed duly given when received in
writing:
by the Fund Manager: Montag & Xxxxxxxx, Inc.
0000 Xxxxxxxxx Xxxx, X.X., Xxxxx 0000
Xxxxxxx, XX 00000-0000
by the Adviser: Enterprise Capital Management, Inc.
0000 Xxxxxxxxx Xxxx, X.X., Xxxxx 000
Xxxxxxx, XX 00000-0000
by the Fund: The Enterprise Group of Funds, Inc.
c/o Enterprise Capital Management, Inc.
0000 Xxxxxxxxx Xxxx, X.X., Xxxxx 000
Xxxxxxx, XX 00000-0000
or by such other person or persons at such address or addresses as shall be
specified by the applicable party, in each case, in a notice similarly given.
Each party may rely upon any notice or other communication from the other
reasonably believed by it to be genuine.
(18) This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original and all of which,
when taken together, shall constitute one and the same agreement.
(19) This Agreement constitutes the entire agreement
between the Fund Manager, the Adviser and the Fund relating to the Growth Fund.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be
signed by their duly authorized officers and their corporate seals hereunder
duly affixed and attested, as of the date first above written.
THE ENTERPRISE GROUP OF FUNDS, INC.
(SEAL)
ATTEST: /s/ XXXXXXXXX X. XXXXXXXXX By: /s/ XXXXXX XXXXXX
---------------------------------- --------------------------------------
Secretary Xxxxxx Xxxxxx, Chairman, President
and Chief Executive Officer
ENTERPRISE CAPITAL MANAGEMENT, INC.
(SEAL)
ATTEST: /s/ XXXXXXXXX X. XXXXXXXXX By: /s/ XXXXXX XXXXXX
---------------------------------- --------------------------------------
Secretary Xxxxxx Xxxxxx, Chairman, President
and Chief Executive Officer
MONTAG & XXXXXXXX, INC.
(SEAL)
ATTEST: /s/ XXXXXXXXX XXXXXXX By: /s/ XXXXXX X XXXXXXXXX
---------------------------------- --------------------------------------
Secretary Name: Xxxxxx X. Xxxxxxxxx
Title: CEO and President
