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EXHIBIT (d)(28)
INVESTMENT SUBADVISORY AGREEMENT
This Investment Subadvisory Agreement is made as of the 8th day of
May, 2000, by and between VANTAGEPOINT INVESTMENT ADVISERS, LLC, a Delaware
limited liability company (hereafter "Client"), ATLANTA CAPITAL MANAGEMENT
COMPANY, LLC, 0000 Xxxxxxxxx Xx., Two Xxxxxxx Xxxxx, Xxxxx 0000, Xxxxxxx,
Xxxxxxx 00000 (hereafter "Subadviser"), and THE VANTAGEPOINT FUNDS, a Delaware
business trust, and is effective as of May 8th, 2000 (the "Effective Date").
WHEREAS, the Vantagepoint Funds (the "Funds") is a Delaware Business
Trust registered as an open-end management investment company under the
Investment Company Act of 1940 (the "1940 Act");
WHEREAS, Client is party to an Investment Adviser Agreement with the
Funds for management of the investment operations of the Funds including the
establishment and operation of investment portfolios for the Funds and the
entering into of contracts with sub-advisers to assist in managing the
investment of the Funds property;
WHEREAS, Client and Subadviser wish to enter into a sub-advisory
agreement pursuant to which Subadviser will provide such assistance to Client.
AGREEMENTS:
In consideration of the performance by the Subadviser as Investment
Subadviser of certain assets held by the Funds, the Client has authorized the
Subadviser to manage the securities and other assets as follows:
1. ACCOUNT
The account with respect to which the Subadviser shall perform its
services shall consist of those assets of the Vantagepoint Growth Fund which
the Client determines to assign to an account with the Subadviser, together
with all income earned by those assets and all realized and unrealized capital
appreciation related to those assets (hereafter "Account"). From time to time,
the Client may, upon notice to the Subadviser, make additions to the Account
and may, upon notice to the Subadviser, make withdrawals from the Account.
2. APPOINTMENT STATUS, POWERS OF SUBADVISER
(a) Purchase and Sale. Client hereby appoints Subadviser to
manage the Account on the terms and conditions set forth in this Agreement.
Subject to the restrictions set forth in this Agreement, and acting always in
conformity with the Investment
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Policies provided in Paragraph 4, Subadviser shall supervise and direct
investment of the Account. Client hereby grants the Subadviser complete,
unlimited and unrestricted discretion and authority to select portfolio
securities with respect to the Account including the power to acquire (by
purchase, exchange, subscription or otherwise), to hold and dispose (by sale,
exchange or otherwise). The Subadviser will consult with Client, upon the
request of the Client, concerning any transactions it makes with respect to
the investment of the Account.
(b) Limitation on Authority. Except as expressly authorized herein or
hereafter from time to time, Subadviser shall for all purposes be deemed an
independent contractor and shall have no authority to act for or to represent
the Client or the Funds in any way or otherwise to be an agent of the Client
or the Funds. The activities of Client and Subadviser in managing the assets
of the Vantagepoint Growth Fund shall in all instances be conducted subject to
the supervision and direction of the Board of Directors of the Vantagepoint
Funds.
(c) Voting. Unless otherwise instructed by Client, Subadviser shall
have discretion to take any action or render any advice with respect to the
voting of shares or the execution of proxies solicited from time to time by,
or with respect to, the issuers of securities held in the Account. Subadviser
will report annually to Client regarding such voting.
(d) Key Personnel. Subadviser agrees that the following key personnel
have primary responsibility with respect to the investment management of the
Account. If the(se) individual(s) is unable to devote sufficient time to
maintain primary responsibility of the Account, the Subadviser must give
Client written advance notice, or prompt notice within three (3) business
days, of the name of the person designated by the Subadviser to replace or
supplement the individual(s). In addition, the Subadviser will give Client
written notice of the replacement of any employee of the Subadviser who has
direct supervisory responsibility for the key personnel or who has
responsibility for setting investment policy as soon as reasonably
practicable.
Key Personnel: XXX XXXXX, III; XXXXXXX XXXXX; XXXX XXXXXXX
3. ACCEPTANCE OF APPOINTMENT
Subadviser accepts the appointment as an investment Subadviser and
agrees to use its best efforts and professional judgment to make timely
investment transactions for the Client with respect to the investments of the
Account, and to provide the other services required of the Subadviser under
the provisions of this Agreement.
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4. INVESTMENT POLICIES
(a) Investment Objectives. Subject to the supervision of the Fund's
Board of Directors and the Client, the Subadviser shall direct the investments
of the Account in accordance with the Fund's investment objectives, policies,
and restrictions as provided in the Fund's Prospectus and Statement of
Additional Information as filed with the Securities and Exchange Commission on
Form N-1A ("Registration Statement"), as currently in effect and as amended or
supplemented from time to time, and such other limitations as the Fund or
Client may reasonably impose by written notice to the Subadviser or as set
forth in SCHEDULE A. Client shall give Subadviser copies of the Fund's
Prospectus and Statement of Additional Information, and any amendments or
supplements thereto, as soon a practicable after such documents become
available.
(b) Funds' Agreement and Declaration of Trust. The Subadviser will
adhere to all specific provisions relating to the investment of the Account
established in the Funds' Agreement and Declaration of Trust and Registration
Statement, both of which are hereby incorporated by reference and made a part
of this Agreement. The Client shall give written notice to the Subadviser of
any amendments to the Agreement and Declaration of Trust or Registration
Statement, which amendments, upon their receipt by the Subadviser, shall be
binding on the Subadviser.
(c) Investment Subadviser Guidelines. The Subadviser shall act in
accordance with the Fund's Prospectus and Statement of Additional Information,
and in accordance with the limitations set forth in the specific statement of
Investment Adviser Guidelines, SCHEDULE B, as restated or modified from time
to time by the Client in written notice to the Subadviser. The Client retains
the right, on written notice to the Subadviser, to modify any such objectives,
guidelines, restrictions, and liquidity requirements in any manner at any time
as may be allowed pursuant to the 1940 Act.
(d) Conflict in Policies. If a conflict in policies or guidelines
referenced herein occurs, the Registration Statement shall govern for purposes
of this Agreement.
5. CUSTODY, DELIVERY, RECEIPT OF SECURITIES
(a) Custody Responsibilities. The Client shall designate one or more
custodians to hold the Account. The Custodian, as designated by the Client will
be responsible for the custody, receipt and delivery of securities and other
assets of the Funds (including the Account), and the Subadviser shall have no
authority, responsibility or obligation with respect to the custody, receipt
or delivery of securities or other assets of the Funds (including the
Account). In the event that any cash or securities of the Funds are
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delivered to the Subadviser, it will promptly deliver the same over to the
Custodian, in the name of the Funds.
(b) Securities Transactions. Unless otherwise required by local
custom, all securities transactions for the Account will be consummated by
payment to or delivery by the Funds of cash or securities due to or from the
Account. The Subadviser will make all reasonable efforts to notify the
Custodian of all orders to brokers for the Account by 9:00 am EST on the day
following the trade date and will affirm the trade within the close of
business one (1) business day after the trade date (T+1).
(c) Tri-Party Agreement. The Subadviser is authorized to enter into
Tri-Party Repurchase Agreements and sign the standard PSA tri-party agreement
(the "Tri-Party Agreement") on behalf of the Client and the subcustodian
thereunder is authorized to act as a subcustodian for the Account's assets
involved in any tri-party repurchase agreement pursuant to such Tri-Party
Agreement.
6. RECORD KEEPING AND REPORTING
(a) Records. Subadviser will maintain proper and complete records
relating to the furnishing of services under this Agreement, including records
with respect to the acquisition, holding and disposition of securities for
Client that are required of an investment adviser to a registered investment
company pursuant to the 1940 Act and the Investment Advisers Act of 1940, and
the rules thereunder, and in accordance with such reasonable instructions as
shall be provided to Subadviser by Client from time to time. All records
maintained pursuant to this Agreement shall be subject to examination by
Client and by persons authorized by it during normal business hours upon
reasonable notice. Except as expressly authorized in this Agreement or as
required by applicable law, regulation or order of court or as directed by
other party in writing, Subadviser and Client shall keep confidential the
records and other information obtained by reason of this Agreement. Upon
termination of this Agreement, Subadviser shall promptly, upon demand, return
to Client all records Client reasonably believes are necessary in order to
discharge its responsibilities to the Funds. Subadviser shall be entitled to
retain originals or copies of records pursuant to the requirements of
applicable laws or regulations.
(b) Reconciliations. Subadviser shall reconcile security and cash
positions, and market values on a monthly basis to the Custodian's records and
report discrepancies to the Client by ten (10) business days after the end of
the month.
(c) Loss Reimbursement. Subadviser shall reimburse the Account for any
material error to the Fund's net asset value caused by Subadviser's breach of
its standard of care set forth in Section 12 that is a direct cause of a delay
in the accurate daily pricing of the Fund(s), provided such loss was not the
result of action or inaction of other service providers to the Client or the
Fund.
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(d) Reports. Subadviser shall furnish Client and the Board of
Directors of the Vantagepoint Funds such periodic and special reports and
information as either of them may request, including such information as shall
be reasonably necessary to evaluate the terms of any advisory agreement
between Client and Subadviser with respect to the assets of the Vantagepoint
Growth Fund.
(e) Other Reports on Request. Subadviser shall provide to Client
promptly upon request any information available in the records maintained by
Subadviser relating to the Account.
(f) Review of Materials. During the term of this Agreement, the
Client shall furnish to the Subadviser at its principal office all
prospectuses, statements of additional information, proxy statements, reports
to shareholders, advertising and sales literature or other material prepared
for distribution to Fund shareholders or the public, which refer to the
Subadviser or its clients in any way, prior to the use thereof, and the Client
shall not use any such materials if the Subadviser reasonably objects in
writing within ten (10) business days (or such other time as may be mutually
agreed) after receipt thereof. The Client shall ensure that materials prepared
by employees or agents of the Client or its affiliates that refer to the
Subadviser or its clients in any way are consistent with those materials
previously approved by the Subadviser as referenced in the preceding sentence.
7. PURCHASE AND SALE OF SECURITIES
(a) Selection of Brokers. Except to the extent otherwise instructed
in writing by Client in acting on behalf of the Fund, (it being understood
that Client, acting on behalf of the Fund, may, in its absolute discretion and
consistent with the requirements of the 1940 Act and applicable federal
securities laws, direct portfolio transactions for which Subadviser is
responsible to any broker that Client may see fit), Subadviser shall place all
orders for the purchase and sale of securities on behalf of the Client with
brokers or dealers selected by Subadviser, but not with a person affiliated
with Subadviser, as the term "affiliated person" is defined in the Investment
Company Act of 1940 (hereafter an "Affiliate"), unless the transaction is in
compliance with Rules 17e-1 or 10f-3 under the 1940 Act, as applicable, and
the Fund's policies and procedures thereunder, copies of which shall be
provided to Subadviser.
(b) Best Execution. In placing such orders, the Subadviser will give
primary consideration to obtaining the most favorable price and efficient
execution reasonably available under the circumstances. In evaluating the
terms available for executing particular transactions for Client and in
selecting brokers and dealers to execute such transactions, the Subadviser may
consider, in addition to commission cost and execution capabilities, the
financial stability and reputation of brokers and dealers and the brokerage
and research services (as those terms are defined in Section 28(e) of the
Securities
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Exchange Act of 1934, as amended) provided by brokers and dealers. Subadviser is
authorized to pay a broker or dealer who provides such brokerage and research
services a commission for executing a transaction which is in excess of the
amount of commission another broker or dealer would have charged for effecting
that transaction if Subadviser determines in good faith that such commission is
reasonable in relation to the value of the brokerage and research services
provided by such broker or dealer in discharging responsibilities with respect
to the Account or to other client accounts as to which it exercises investment
discretion.
(c) Bunching Orders. Client agrees that Subadviser may
aggregate sales and purchase orders of Account with similar orders being made
simultaneously for other accounts managed by Subadviser, if in Subadviser's
reasonable judgment such aggregation shall result in an overall economic benefit
or more efficient execution to the Account taking into consideration the
advantageous selling or purchase price, brokerage commission and other expenses.
Client acknowledges that the determination of such economic benefit to the Fund
by Subadviser represents Subadviser's evaluation that the Account is benefited
by relatively better purchase or sales prices, lower commission expenses and
beneficial timing of transactions or a combination of these and other factors.
In such event, allocation of the securities so purchased or sold, as well as
expenses incurred in the transaction, will be made by the Subadviser in a manner
the Subadviser considers to be most equitable and consistent with its fiduciary
obligations to the Fund and to its other clients.
8. INVESTMENT FEES
(a) Fee Schedule. The compensation of the Subadviser for its
services under this Agreement shall be calculated and paid by the Client from
the assets of the Account in accordance with SCHEDULE C hereto.
(b) For purposes of this section 8 and Schedule C, all payments
due to Subadviser shall be solely made from the assets of the Vantagepoint
Growth Fund, a portfolio of the Vantagepoint Funds.
(c) Pro Rata Fee. If the Subadviser should serve for less than
the whole of any calendar quarter, its compensation shall be determined as
provided above on the basis of the ending market value of the Account in the
month in which the termination occurs and shall be payable on a pro rata basis
for the period of the calendar quarter for which it has served as Subadviser
hereunder.
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9. BEST EFFORTS; NON-EXCLUSIVITY OF SERVICES
The Subadviser shall devote its best efforts and such time as it
deems necessary to provide prompt and expert service to the Client. The services
of Subadviser to be provided to Client hereunder are not to be deemed exclusive
and Subadviser shall be free to provide similar services for its own account and
the accounts of other persons and to receive compensation for such services.
Client acknowledges that Subadviser and its members, Affiliates and employees,
and Subadviser's other clients may at any time, have, acquire, increase,
decrease, or dispose of positions in the same investments which are at the same
time being held, acquired for or disposed of under this Agreement for the Fund.
Subadviser shall have no obligation to acquire or dispose of a position in any
investment pursuant to this Agreement simply because Subadviser, its directors,
members, Affiliates or employees invest in such a position for its or their own
accounts or for the account of another client.
10. XXXXXXX XXXXXXX POLICIES AND CODE OF ETHICS
Subadviser hereby represents that it has adopted policies that
meet the requirements of Rule 17j-1 under the Investment Company Act of 1940.
Copies of such policies shall be delivered to the Client upon request, and any
material violation of such policies by personnel of the Subadviser who are
"access persons" with respect to the Account shall be reported to the Client
11. INSURANCE
At all times during the term of this Agreement, Subadviser shall
maintain, at its own cost and expense, professional liability insurance for
errors, omissions, and negligent acts, in an amount and with such terms as are
standard in the financial services industry for an investment adviser managing
the amount of aggregate assets managed by Subadviser for Client and for the
Subadviser's other clients.
12. LIABILITY
In the absence of any gross negligence, malfeasance, or willful
violation of this Agreement, Subadviser shall not be liable to Client for honest
mistakes of judgment or for action or inaction taken in good faith for a purpose
that the Subadviser reasonably believes to be in the best interests of the
Client or the Fund. However, neither this provision nor any other provision of
this Agreement shall constitute a waiver or limitation of any rights which
Client may have under federal or state securities laws.
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13. TERM
This Agreement shall be in effect for an initial term of two years
beginning on the Effective Date. This Agreement may be renewed thereafter for
successive one-year periods if such renewal is approved annually by the majority
of the Fund's Board of Directors, provided that in such event, continuance shall
also be approved by a vote of those members of the Funds' Board of Directors who
are not "interested persons" as that term is defined in the Investment Company
Act of 1940.
14. TERMINATION
This Agreement may be terminated by either party hereto, without
the payment of any penalty, immediately upon notice to the other in the event of
a material breach of any provision thereof by the party so notified if such
breach shall not have been cured within a twenty (20) day period after notice of
such breach, or otherwise by Subadviser upon sixty (60) days' written notice to
the Client or by Client upon 30 days' written notice to Subadviser, except that
this Agreement shall automatically terminate in the event of its assignment, as
provided in Paragraph 19, at the discretion of the Client in the event of
Subadviser's change in control as provided in Paragraph 19, upon the termination
of the Funds, or upon termination of Client's advisory agreement with the Funds.
Any termination in accordance with the terms of this Agreement shall not cause
the payment of any penalty. Any such termination shall not affect the status,
obligations or liabilities of any party hereto to the other.
15. REPRESENTATIONS
(a) Subadviser hereby confirms to Client that Subadviser is
registered as an investment adviser under the Investment Advisers Act of 1940,
that it has full power and authority to enter into and perform fully the terms
of this Agreement and that the execution of this Agreement on behalf of
Subadviser has been duly authorized and, upon execution and delivery, this
Agreement will be binding upon Subadviser in accordance with its terms.
(b) Client hereby confirms to Subadviser that it is registered
as an investment adviser under the Investment Advisers Act of 1940, that it has
full power and authority to enter into this Agreement and that the execution of
this Agreement on behalf of Client has been fully authorized and, upon execution
and delivery, this Agreement will be binding upon Client in accordance with its
terms.
(c) Subadviser hereby acknowledges that the Vantagepoint Funds
is registered as an open-end investment company under the 1940 Act and is
subject to
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taxation as a regulated investment company under Subchapter M and the
regulations promulgated thereunder of the Internal Revenue Code. Subadviser
hereby represents that it is familiar with the requirements of such laws and the
rules and regulations thereunder as they apply to the Vantagepoint Funds and has
systems and procedures in place reasonably designed to permit Subadviser,
Client, and the Vantagepoint Funds to comply with such requirements.
16. NOTICES
Notices or other notifications given or sent under or pursuant to
this Agreement shall be in writing and be deemed to have been given or sent if
delivered to the party at its address listed below in person or by telex or
telecopy receipt of which is confirmed or by mail or by registered mail, return
receipt requested. The addresses of the parties are:
CLIENT:
Vantagepoint Investment Advisers, LLC
Attention: Xxxx Xxxxxxxxx, Legal Department
c/o ICMA Retirement Corporation
000 Xxxxx Xxxxxxx Xxxxxx, XX, Xxx. 000
Xxxxxxxxxx, X.X. 00000-0000
SUBADVISER:
Atlanta Capital Management Company, LLC
Two Midtown Plaza, Suite 1600
0000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000
Each party may change its address by giving notice as herein
required.
17. SOLE INSTRUMENT
This instrument constitutes the sole and only agreement of the
parties to it relating to its object and correctly sets forth the rights,
duties, and obligations of each party to the other as of its date. Any prior
agreements, promises, negotiations or representations not expressly set forth in
this Agreement are of no force or effect.
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18. WAIVER OR MODIFICATION
No waiver or modification of this Agreement shall be effective
unless reduced to a written document signed by the party to be charged. No
failure to exercise and no delay in exercising, on the part of any party hereto,
of any right, remedy, power or privilege hereunder, shall operate as a waiver
thereof. Only the Chief Executive Officer, has authority on behalf of Client to
modify or waive any of the provisions of the Agreement. It is understood that
certain material amendments may require approval of the Funds shareholders.
19. ASSIGNMENT AND CHANGE IN CONTROL
This Agreement shall automatically terminate in the event of its
assignment. Subadviser agrees to provide immediate written notice in the event
of a change in control. Such a change in control will entitle, but not require,
the Client to terminate the Agreement immediately or upon notice.
20. COUNTERPARTS
This Agreement may be executed in counterparts each of which shall
be deemed to be an original and all of which, taken together, shall be deemed to
constitute one and the same instrument.
21. CHOICE OF LAW
This Agreement shall be governed by, and the rights of the parties
arising hereunder construed in accordance with, the laws of the State of
Delaware without reference to principles of conflict of laws and the 1940 Act.
To the extent that the applicable laws of the State of Delaware conflict with
the applicable provisions of the 1940 Act, the latter shall control.
22. YEAR 2000 STATEMENT
Subadviser certifies that it has taken the steps to address the
Year 2000 problem that are set forth in Subadviser's SEC Form ADV-Y2K, a copy of
which has been filed with the SEC and provided to Client. Any subsequent SEC
filings regarding this issue shall be provided to Client.
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IN WITNESS WHEREOF, THE PARTIES HERETO EXECUTE THIS AGREEMENT ON May 8, 2000 and
make it effective on the date set forth.
CLIENT SUBADVISER
Vantagepoint Atlanta Capital Management Company, LLC
Investment Advisers, LLC
by: by:
/s/ XXXXXX XXXXXX /s/ XXXXXXX X XXXXXXX III
--------------------------- ----------------------------------
(signature) (signature)
/s/ XXXXXXX X XXXXXXX III
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Xxxxxx Xxxxxx, President (name, title,)
Managing Partner
Date: May 1, 2000 Date: 20 Mar 2000
FUNDS
The Vantagepoint Funds
by:
/s/ XXXXXX XXXXXX
----------------------------
Xxxxxx Xxxxxx, President
Date: May 1, 2000
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SCHEDULE A
THE VANTAGEPOINT FUNDS
GROWTH FUND
STATEMENT OF INVESTMENT POLICIES
These Investment Policies and Guidelines have been adopted by the Vantagepoint
Funds (the "Funds") to govern the management and administration of the Growth
Fund by Vantagepoint Investment Advisers, LLC ("VIA"). They may be reviewed and
revised at the discretion of the Directors of the Vantagepoint Funds (the
"Directors"). VIA is responsible for the monitoring and appointment of
subadvisers to handle the day-to-day investment of assets assigned to them.
I. GENERAL DESCRIPTION AND GOALS
The Growth Fund seeks long-term growth of capital by investing primarily
in common stocks with above average growth potential. Dividend income is
incidental to the overall growth objective.
II. STRUCTURE
The assets of the Growth Fund shall be managed by two or more
subadvisers. The subadvisers may be retained to manage separate accounts
under discretionary investment advisory contracts. Each subadviser will
be selected for its individual investment management expertise and each
will operate independently of the others. Each subadviser must either be
registered with the Securities and Exchange Commission (SEC) under the
Investment Advisers Act of 1940 or a Bank, Insurance Company or Trust
Company exempt as such from registration.
Each subadviser shall exercise complete management discretion over
assets of the Fund allocated to its account in a manner consistent with
these Investment Policies and Guidelines and with such further
investment limitations and conditions as may be recommended by VIA and
approved by the Directors. Subadvisers will be obligated to manage Fund
assets as if they were subject to the fiduciary duty of care that
applies under the Employee Retirement Income Security Act of 1974
(ERISA) governing pension and profit sharing assets.
XXX Xxxx Xxxxxxxxxx--Xxxxxxx 0, 0000
00
XXX. INVESTMENT STRATEGY
VIA shall select subadvisers that represent a variety of portfolio
management approaches and investment disciplines. These investment
approaches will be combined in a complementary manner to effectively
achieve the investment objective of the Fund. The Fund as a whole will
be more diversified than each individual subadviser's portfolio.
Investment strategies employed by the subadvisers included in the Growth
Fund may may focus on past patterns as well as future prospects for
growth in corporate earnings per share. For example, earnings growth may
result from changes in a company's management, an industry trend, a
cyclical recovery, unit growth, new products, and product expansion.
Investments may include:
- equity securities of large established growth companies,
medium size firms, and smaller emerging growth
companies,
- securities issued by companies that are "distressed" or
"out of favor",
- securities issued by foreign companies, and
- futures contracts.
Certain of the above strategies are not permitted or their use is
limited under the Investment Guidelines for the individual subadvisers.
IV. PERFORMANCE BENCHMARKS
Performance benchmarks will be established for the Fund. These
benchmarks will be recommended by VIA and adopted by the Directors and
will be reviewed and revised as appropriate from time to time. The
current performance benchmarks for the Fund are appended to this
document as Exhibit I.
V. DIRECTOR REVIEW
VIA will report periodically to the Directors on performance of the Fund
against benchmarks and on subadviser results and will evaluate for the
Directors the overall performance of the Fund relative to its
objectives. The Directors will consider such reports and other relevant
factors in appraising the investment objectives and performance of the
Fund.
XXX Xxxx Xxxxxxxxxx--Xxxxxxx 0, 0000
00
INVESTMENT GUIDELINES
I. ELIGIBLE INVESTMENTS
A. EQUITY SECURITIES: U.S. and non-U.S. common stock (including
shares of closed-end funds), preferred stock, common stock
equivalents (units of beneficial interest), American Depository
Receipts, convertible preferred stocks, warrants, and other
rights.
B. CASH/CASH EQUIVALENTS: Fixed income obligations with maturity
less than one year, or short term accounts managed by a
custodian institution.
C. FIXED INCOME: Fixed income and convertible fixed income
securities with maturities greater than one year.
D. FINANCIAL FUTURES: Equity index futures.
E. ELIGIBLE PRACTICES: There are no restrictions on subadvisers as
to the following:
- Portfolio turnover.
- Realized gains and losses.
F. ELIGIBLE INVESTMENT LIMITS
MINIMUM NORMAL RANGE MAXIMUM
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U.S. equity securities 65% 80-100% 100%
Non-U.S. equity securities 0% 0-10% 20%
Cash and cash equivalents 0% 0-10% 35%
Fixed income securities 0% 0-5% 10%
II. PROHIBITED PRACTICES AND SECURITIES
A. Short sales
B. Options
C. Commodities (excluding financial futures).
D. Securities for which there is no established trading market.
E. Securities issued by the subadvisers of the Fund or their
affiliates.
XXX Xxxx Xxxxxxxxxx--Xxxxxxx 0, 0000
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X. General partner interests.
G. Direct investments in oil, gas, or other mineral exploration or
development programs.
H. Direct investments in real estate or interests in real estate;
this does not preclude investment in purchases of securities of
real estate investment trusts and other companies holding real
estate or interests in real estate.
I. Commingled funds; this does not preclude investment in mutual
funds up to 10% of the Fund's market value at the time of
purchase.
J. Acquisition of securities that would cause exposure to
non-equity holdings to exceed 35% of the Fund's market value at
the time of purchase.
K. Acquisition of securities that would cause exposure to a single
industry to exceed 25% of the Fund's market value at the time of
purchase.
L. In the absence of prior consent of VIA, acquisition of
securities of an issuer that would cause more than 5% of the
Fund to be invested in such securities.
M. In the absence of prior consent of VIA, acquisition of more than
5% of the outstanding shares of any class of equity securities.
III. SECURITIES AND PRACTICES NOT OTHERWISE MENTIONED
Any securities or practices not enumerated in Section I or Section II of
these Investment Guidelines may be acquired or employed, as the case may
be, but only if explicitly approved in advance by VIA.
IV. SECURITIES LENDING
Nothing herein shall prevent loans of securities in the Fund pursuant to
an established securities lending program conducted by the Fund's
custodian.
XXX Xxxx Xxxxxxxxxx--Xxxxxxx 0, 0000
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XXXXXXX I
TO THE
STATEMENT OF INVESTMENT POLICIES AND GUIDELINES OF
THE GROWTH FUND
OCTOBER 1, 1999
The following standards will be used to measure the performance of the Growth
Fund:
A. BENCHMARKS
1. The performance benchmark for the Fund is the WILSHIRE 5000
INDEX. This benchmark will be used to measure the Fund's
performance net of subadviser fees.
2. A peer group benchmark for the Fund will consist of mutual funds
with characteristics similar to the Fund. The peer group will be
used to measure the Fund's performance relative to other funds
with a similar investment approach. The peer group benchmark
will measure Fund performance net of all fees and expenses
except for the plan administration fee.
3. The Lipper Growth Index, selected by Lipper Analytical Services,
will serve as the performance benchmark for participant returns,
net of all fees and expenses. In assessing performance against
this benchmark, it will be taken into consideration that Lipper
Analytical Services may change the composition of the Index.
B. TIME HORIZON
The time horizon for performance measurement will be one, three, and
five years.
One Year:
Performance relative to any benchmark established for the Fund will vary
over one year periods; such variance over short time periods is expected
and acceptable. However, if such variance is determined to be caused by
systemic issues, action may be appropriate.
XXX Xxxx Xxxxxxxxxx - Xxxxxxx 0, 0000
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Three and Five Years:
Performance of the Fund should track market and universe benchmarks more
closely as the evaluation period lengthens. The ideal performance
objective for the Fund is to exceed the returns of all relevant
benchmarks; however, shortfalls over various time periods should be
expected in some cases. Underperformance against a single benchmark over
an extended period may be acceptable, particularly if other benchmarks
have been exceeded.
C. INVESTMENT CHARACTERISTICS
The Growth Fund may have investment characteristics which differ from
the general market, as measured by the Standard & Poor's 500 Index. For
the total Fund, these would include, but are not limited to:
CHARACTERISTIC RELATIVE TO WILSHIRE 5000 INDEX
Beta Higher
Capitalization Lower
Dividend Yield Lower
Hist. 5 year EPS Growth Higher
Price to Earnings Ratio Higher
Standard Deviation Higher
VIA Fund Guidelines - October 1, 1999
18
SCHEDULE B
VANTAGEPOINT INVESTMENT ADVISERS, LLC
GROWTH FUND
INVESTMENT GUIDELINES
FOR
ATLANTA CAPITAL MANAGEMENT COMPANY, L.L.C.
MARCH 28, 2000
Atlanta Capital Management Company, L.L.C. follows a "High Quality Growth"
approach to security selection, focusing on large-capitalization, U.S.
securities. Screening criteria and fundamental analysis lead to portfolio
holdings that exhibit sustainable growth, reasonable valuation and fit within
Atlanta's top-down economic themes. The portfolio is well diversified in 40 to
60 holdings and is normally fully invested in equities at all times.
I. ELIGIBLE INVESTMENTS
A. EQUITY SECURITIES: Common stock, preferred stock, common stock
equivalents (units of beneficial interest), American Depository
Receipts, convertible preferred stocks, warrants, and other
rights.
B. CASH/CASH EQUIVALENTS: Fixed income obligations with maturities
less than one year, or short term accounts or securities managed
by the custodian institution.
C. FIXED INCOME: Fixed income and convertible fixed income
securities with maturities greater than one year.
D. ELIGIBLE INVESTMENT LIMITS:
MINIMUM NORMAL RANGE MAXIMUM
------- ------------ -------
U.S. Equity securities 80% 90%-100% 100%
Non-U.S. Equity securities 0% 0%-5% 10%
(must be listed and traded in U.S.)
Cash and cash equivalents 0% 0%-10% 15%
Fixed income securities 0% 0%-5% 10%
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00
XX. PROHIBITED PRACTICES AND SECURITIES
A. Short Sales.
B. Options.
C. Commodities (including financial futures).
D. Securities for which there is no established trading market.
E. Securities not listed and traded in the U.S.
F. Margin purchases and other forms of borrowing; granting of
pledges or other security interests in assets of the portfolio;
use of futures to obtain market leverage.
G. Securities offered by the Adviser or its affiliates.
H. General partner interests.
I. Direct investments in oil, gas, or other mineral exploration or
development programs.
J. Direct investments in real estate or interests in real estate;
this does not preclude investment in purchases of securities of
real estate investment trusts and other companies holding real
estate or interests in real estate.
K. Acquisition of securities of an issuer that would cause more
than 5% of the portfolio at the time of purchase to be invested
in such securities.
L. Acquisition of more than 5% of the outstanding stock of any
issuer.
M. Acquisition of securities that would cause exposure to a single
industry to exceed 25% of the portfolio at the time of purchase.
N. Commingled and registered mutual funds.
Exceptions to the above listed eligible investments and prohibited
securities or practices may be permitted with prior consent from VIA.
VIA Fund Guidelines - October 1, 1999
20
III. SECURITIES AND PRACTICES NOT OTHERWISE MENTIONED
Any securities or practices not enumerated in Section I or Section II of
these Investment Guidelines may be acquired or employed, as the case may
be, but only if explicitly approved in advance by VIA.
IV. PERFORMANCE BENCHMARK AND MONITORING CRITERIA
The standards outlined in this section are subject to review by VIA as
and when appropriate.
A. PERFORMANCE BENCHMARKS
The market benchmark for measuring investment performance for
the Adviser is the S&P 500 INDEX. The Adviser is expected to
outperform the benchmark net of Adviser fees over rolling three
and five-year periods.
B. PEER GROUPS
VIA will develop an appropriate peer group against which to
compare investment performance. The peer group will consist of
other managers with a similar investment approach. The managers
within the peer group will be reviewed periodically for
consistency of style and may be changed as and when deemed
appropriate by VIA. Such changes will be communicated to the
Adviser.
1. The peer group will consist primarily of mutual funds,
however separate account managers may be included.
2. VIA will track relative net-of-fee performance quarterly
and evaluate performance on a trailing one, three and
five-year basis.
3. VIA will compare the Adviser's net performance with the
one-year mean return of the peer group.
VIA Fund Guidelines - October 1, 1999
21
SCHEDULE C
VANTAGEPOINT INVESTMENT ADVISERS, LLC
FEE SCHEDULE
FOR
ATLANTA CAPITAL MANAGEMENT COMPANY, L.L.C.
The Advisor's quarterly fee shall be calculated based on the average daily net
assets of the assets under management as provided by the Custodian, based on the
following annual rate.
First $100 million 0.45 percent
Next $200 million 0.35 percent
Next $200 million 0.30 percent
Over $500 million 0.25 percent
EXAMPLE OF QUARTERLY FEE CALCULATION (HYPOTHETICAL AMOUNTS)
January 1, 1999 $350,000,000 End-of-Day Net Assets
January 2, 1999 $350,678,462 End-of-Day Net Assets
January 3, 1999 $350,796,123 End-of-Day Net Assets
...
March 29, 1999 $360,512,214 End-of-Day Net Assets
March 30, 1999 $361,720,978 End-of-Day Net Assets
March 31, 1999 $362,901,556 End-of-Day Net Assets
Quarterly Daily Average $357,601,560
$100 million 0.45 percent $450,000
Next $200 million 0.35 percent $700,000
Next $200 million 0.30 percent $172,805
Over $500 million 0.25 percent ----------
Annual fee $1,322,805
One-Fourth Annual Fee $330,701
XXX Xxxx Xxxxxxxxxx - Xxxxxxx 0, 0000
