EXHIBIT (d)(xviii)
DEEP VALUE PORTFOLIO
OF
ENTERPRISE ACCUMULATION TRUST
PORTFOLIO MANAGER'S AGREEMENT
THIS AGREEMENT, made the 1st day of May, 2003, is among Enterprise
Accumulation Trust (the "Fund"), a Massachusetts business trust, Enterprise
Capital Management, Inc., a Georgia corporation (hereinafter referred to as the
"Adviser"), and Wellington Management Company, LLP, a Massachusetts limited
liability partnership, (hereinafter referred to as the "Portfolio Manager").
BACKGROUND INFORMATION
(A) The Adviser has entered into an Investment Adviser's Agreement with
the Fund ("Investment Adviser's Agreement"). 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 Portfolio Managers to the portfolios.
(B) The parties hereto wish to enter into an agreement whereby the
Portfolio Manager will provide to the Deep Value Portfolio, a series of the Fund
(the "Deep Value Portfolio") securities investment advisory services for the
Deep Value Portfolio.
WITNESSETH THAT:
In consideration of the mutual covenants herein contained, the Fund,
Adviser and the Portfolio Manager agree as follows:
(1) The Fund and Adviser hereby employ the Portfolio Manager
to render certain investment advisory services to the Deep Value Portfolio, as
set forth herein. The Portfolio 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 Portfolio Manager shall manage the investments of the
Deep Value Portfolio and the composition of the Deep Value Portfolio's
portfolio, including the purchase, retention and disposition thereof, or such
portion of the assets of the Deep Value Portfolio as the Adviser shall specify
from time to time, in accordance with the investment objectives, restrictions
and limitations applicable to the Deep Value Portfolio which are set forth in
the Fund's most recent Registration Statement or any supplements thereto.
(3) The Portfolio Manager shall provide supervision of the
Deep Value Portfolio's investments and determine from time to time what
investments and securities will be purchased, retained or sold by the Deep Value
Portfolio and what portion of the assets will be invested or held uninvested in
cash, in accordance with the investment objectives, restrictions and limitations
applicable to the Deep Value Portfolio which are set forth in the Fund's most
recent Registration Statement or any supplements thereto.
(4) The Portfolio Manager shall maintain all books and records
with respect to the Deep Value Portfolio's portfolio transactions required by
subparagraphs (b)(5), (6), (7), (9), (10) and (11)
and paragraph (f) of Rule 31a-1 under the Investment Company Act of 1940 ("xxx
0000 Xxx") and shall render to the Fund's Board of Trustees such periodic and
special reports as the Fund's Board of Trustees may reasonably request. The
Portfolio Manager shall timely furnish to the Adviser all information relating
to the Portfolio Manager's services under this Agreement needed by the Adviser
to keep the other books and records of the Deep Value Portfolio required by Rule
31a-1 under the 1940 Act. The Portfolio Manager agrees that all records that it
maintains on behalf of the Deep Value Portfolio are property of the Deep Value
Portfolio and the Portfolio Manager will surrender promptly to the Deep Value
Portfolio any of such records upon the Deep Value Portfolio's request; provided,
however, that the Portfolio Manager may retain a copy of such records. The
Portfolio Manager further agrees to preserve for the periods prescribed by Rule
31a-2 under the 1940 Act any such records as are required to be maintained by it
pursuant to this Agreement. The Portfolio Manager shall perform a monthly
reconciliation of the Deep Value Portfolio to the holdings report provided by
the Portfolio's custodian and bring any material or significant variances
regarding holdings or valuations to the attention of the Adviser.
(5) The Portfolio Manager shall for all purposes herein be
deemed to be an independent contractor. The Portfolio Manager has no authority
to act for or represent the Fund or the Portfolios in any way except to
establish brokerage accounts with one or more brokers, dealers or other
financial intermediaries as the Portfolio Manager may select and to direct
securities transactions pursuant to its investment advice hereunder. The
Portfolio Manager is not an agent of the Fund or the Deep Value Portfolio.
(6) It is understood that the Portfolio Manager does not, by
this Agreement, undertake to assume or pay any costs or expenses of the Fund or
the Deep Value Portfolio.
(6) (a) The Adviser agrees to pay the Portfolio 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 0.033333 of 1% of the
average of the daily closing net asset value of the Deep Value Portfolio managed
by the Portfolio Manager during such month (that is, 0.40 of 1% per year) for
the first $100,000,000 of assets under management; and a sum equal to 0.025 of
1% of the average of the daily closing net asset value of the Deep Value
Portfolio during such month (that is, 0.30 of 1% per year) thereafter.
(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 Fund 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 Deep
Value Portfolio's shares.
(7) The services of the Portfolio Manager hereunder are not to
be deemed to be exclusive, and the Portfolio Manager is free to render services
to others and to engage in other activities so long as its services hereunder
are not impaired thereby. Services to be furnished by the Portfolio Manager
under this agreement may be furnished through the medium at any of the Portfolio
Manager's partners, officers or employees. However, day-to-day management of the
Deep Value Portfolio shall be the responsibility of the individual or
individuals specified in the Fund's Registration Statement or any supplements
thereto. Without in any way relieving the Portfolio Manager of its
responsibilities hereunder, it is agreed that the Portfolio 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 Portfolio Manager shall not be liable
to the Fund, the Deep Value Portfolio or the Adviser or to any shareholder or
shareholders of the Fund, the Deep Value 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 Portfolio Manager hereunder.
(9) The Portfolio Manager will take necessary steps to prevent
the investment professionals of the Portfolio Manager who are responsible for
investing assets of the Deep Value Portfolio from taking, at any time, a short
position in any shares of any holdings of the Deep Value Portfolio for any
accounts in which such individuals have a beneficial interest, excluding short
positions, including without limitation, short against-the-box positions,
effected for tax reasons. The Portfolio Manager has adopted a written policy
prohibiting xxxxxxx xxxxxxx, a copy of which has been provided to the Adviser.
(10) In connection with the management of the investment and
reinvestment of the assets of the Deep Value Portfolio, the Portfolio Manager
is authorized to select the brokers or dealers that will execute purchase and
sale transactions for the Deep Value Portfolio, including those which from
time to time may furnish to Portfolio Manager or its affiliates statistical
and investment research information and other services 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 Deep Value Portfolio. Subject to this primary requirement, and maintaining
as its first consideration the benefits for the Deep Value Portfolio and its
shareholders, the Portfolio Manager shall have the right, subject to the
direction of the Board of Trustees of the Fund, to select certain brokers and
dealers who furnish statistical research and other services to the Deep Value
Portfolio, the Adviser, or the Portfolio Manager and, subject to the Conduct
Rules of the National Association of Securities Dealers, Inc., to select
brokers and dealers who sell shares of the Portfolio.
(11) The Portfolio Manager shall vote securities held in the
Deep Value Portfolio in response to proxies solicited by the issuers of such
securities and timely received by the Portfolio Manager, in accordance with the
Portfolio Manager's Proxy Voting Guidelines, a copy of which is available upon
request.
(12) The Adviser has delivered to the Portfolio Manager copies
of each of the following documents and will deliver to it all future amendments
and supplements, if any:
(12) (a) By-Laws of the Fund (such By-Laws, as in effect on
the date of this Agreement and as amended from time to time, are herein
called the "By-Laws")'
(12) (b) Certified resolutions of the Fund's Board of Trustees
authorizing the appointment of the Adviser and Portfolio Manager with
respect to the Deep Value Portfolio, and approving the form of this
Agreement;
(12) (c) Registration Statement under the 1940 Act and the
Securities Act of 1933, as amended, on Form N-1A (the "Registration
Statement"), as filed with the Securities and Exchange Commission (the
"Commission") relating to the Fund and shares of the Fund's beneficial
shares, and all amendments thereto;
(12) (d) Prospectus of the Fund.
(13) The Portfolio Manager is prohibited from consulting with
other portfolio managers to the Deep Value Portfolio or other portfolio managers
to a fund under common control with the Deep Value Portfolio concerning the Deep
Value Portfolio's transactions in securities or other assets.
(14) During the term of this Agreement, the Adviser agrees to
furnish the Portfolio Manager at its principal office all sales literature
prepared for distribution to stockholders of the Deep Value Portfolio, the Fund
or the public that refer to the Portfolio Manager in any way, prior to the use
thereof, and the Adviser shall not use any such materials if the Portfolio
Manager reasonably objects in writing within five business days (or such other
period as may be mutually agreed) after receipt thereof. The Portfolio Manager's
right to object to such materials is limited to the portions of such materials
that expressly relate to the Portfolio Manager, its services and its clients.
The Adviser agrees to use its reasonable best efforts to ensure that materials
prepared by its employees or agents or its affiliates that refer to the
Portfolio Manager or its clients in any way are consistent with those materials
previously approved by the Portfolio Manager as referenced in the first sentence
of this paragraph. Sales literature may be furnished to the Portfolio Manager by
first class or overnight mail, facsimile transmission equipment or hand
delivery.
(15) On occasions when the Portfolio Manager deems the
purchase or sale of a security to be in the best interest of the Deep Value
Portfolio as well as other clients of the Portfolio Manager, it may allocate
such transactions in the manner it considers to be the most equitable and
consistent with its fiduciary obligation to the Deep Value Portfolio and to such
other clients.
(16) The Fund may terminate this Agreement by thirty (30) days
written notice to the Adviser and the Portfolio Manager at any time, without the
payment of any penalty, by vote of the Fund's Board of Trustees, 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 Portfolio Manager and the
Portfolio 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.
(17) Subject to prior termination as provided above, this
Agreement shall continue in force from the date of execution until May 1, 2005
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 Trustees of the Fund, including a majority of those
Trustees who are not parties to this Agreement or 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 Trustees 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.
(18) The Adviser shall indemnify and hold harmless the
Portfolio Manager, its officers and partners and each person, if any, who
controls the Portfolio 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 Portfolio 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 Portfolio 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 Portfolio Manager or such controlling persons.
The Portfolio Manager shall indemnify and hold
harmless the Adviser and each of its Trustees 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 described in the
foregoing indemnity, but only with respect to the Portfolio Manager's willful
misfeasance, bad faith or gross negligence in the performance of its duties
under this Portfolio 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 Portfolio Manager, the Portfolio 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 Portfolio Manager by
the provisions of subsection (i) and (ii) of this Paragraph 16.
(19) Except as otherwise provided in Paragraph 16 hereof and
as may be required under applicable federal law, this Portfolio Manager's
Agreement shall be governed by the laws of the State of Georgia.
(20) The Portfolio Manager agrees to notify the parties within
a reasonable period of time regarding a material change in the partnership of
the Portfolio Manager.
(21) 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.
(22) 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 Portfolio Manager:Wellington Management Company, LLP
00 Xxxxx Xxxxxx
Xxxxxx, XX 00000-0000
by the Adviser: Enterprise Capital Management, Inc.
0000 Xxxxxxxxx Xxxx, X.X., Xxxxx 000
Xxxxxxx, XX 00000-0000
by the Fund: Enterprise Accumulation Trust 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.
(23) No provisions of this Agreement may be changed, waived,
discharged or terminated orally, but only by an instrument in writing signed by
the party against which enforcement of
the change, waiver, discharge or termination is sought, and no amendment of this
Agreement shall be effective until approved by the Board of Trustees of the Fund
in the manner required by the 1940 Act.
(24) Should any part of this Agreement be held invalid by a
court decision, statute, rule or otherwise, the remainder of this Agreement
shall not be affected thereby. This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their respective successors.
(25) Where the effect of a requirement of the 1940 Act
reflected in any provision of this Agreement is altered by a rule, regulation or
order of the Commission, whether of special or general application, such
provision shall be deemed to incorporate the effect of such rule, regulation or
order.
(26) 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.
(27) This Agreement constitutes the entire agreement between
the Portfolio Manager, the Adviser and the Fund relating to the Deep Value
Portfolio.
IN WITNESS WHEREOF, the parties have caused this Agreement to be signed
by their duly authorized officers and attested, if applicable, as of the date
first above written.
ENTERPRISE ACCUMULATION TRUST
ATTEST: By:
----------------------- ------------------------------------
Secretary Xxxxxx Xxxxxx, Chairman, President
and Chief Executive Officer
ENTERPRISE CAPITAL MANAGEMENT, INC.
ATTEST: By:
------------------------- -----------------------------------
Secretary Xxxxxx Xxxxxx, Chairman, President
and Chief Executive Officer
WELLINGTON MANAGEMENT COMPANY, LLP
ATTEST: By:
------------------------- ------------------------------------
Name: Name:
------------------------ ----------------------------------
Title:
---------------------------------
