INVESTMENT ADVISORY AGREEMENT
AGREEMENT made this ____ day of May, 1997, by and between TIP Funds, a
Massachusetts business trust (the "Trust"), and Clover Capital Management, Inc.
(the "Adviser").
WHEREAS, the Trust is an open-end, diversified management investment
company registered under the Investment Company Act of 1940, as amended,
consisting of several series of shares, each having its own investment policies;
and
WHEREAS, the Trust has retained SEI Financial Management Corporation
(the "Administrator") to provide administration of the Trust's operations,
subject to the control of the Board of Trustees;
WHEREAS, the Trust desires to retain the Adviser to render investment
management services with respect to the Portfolios set forth in the attached
schedule and such other portfolios as the Trust and the Adviser may agree upon
(the "Portfolios"), and the Adviser is willing to render such services:
NOW, THEREFORE, in consideration of mutual covenants herein contained,
the parties hereto agree as follows:
1. Duties of Adviser. The Trust employs the Adviser to manage the
investment and reinvestment of the assets, and to continuously
review, supervise, and administer the investment program of the
Portfolios, to determine in its discretion the securities to be
purchased or sold, to provide the Administrator and the Trust
with records concerning the Adviser's activities which the Trust
is required to maintain, and to render regular reports to the
Administrator and to the Trust's Officers and Trustees concerning
the Adviser's discharge of the foregoing responsibilities.
The Adviser shall discharge the foregoing responsibilities
subject to the control of the Board of Trustees of the Trust and
in compliance with such policies as the Trustees may from time to
time establish, and in compliance with the objectives, policies,
and limitations for each such Portfolio set forth in the
Portfolio's prospectus and statement of additional information as
amended from time to time, and applicable laws and regulations.
The Adviser accepts such employment and agrees, at its own
expense, to render the services and to provide the office space,
furnishings and equipment and the personnel required by it to
perform the services on the terms and for the compensation
provided herein.
2. Portfolio Transactions. The Adviser is authorized to select the
brokers or dealers that will execute the purchases and sales of
portfolio securities for the Portfolios and is directed to use
its best efforts to obtain the best net results as described from
time to time in the Portfolios' Prospectuses and Statement of
Additional Information. The Adviser will promptly communicate to
the Administrator and to the officers and the Trustees of the
Trust such information relating to portfolio transactions as they
may reasonably request.
It is understood that the Adviser will not be deemed to have
acted unlawfully, or to have breached a fiduciary duty to the
Trust or be in breach of any obligation owing to the Trust under
this Agreement, or otherwise, by reason of its having directed a
securities transaction on behalf of the Trust to a broker-dealer
in compliance with the provisions of Section 28(e) of the
Securities Exchange Act of 1934 or as described from time to time
by the Portfolios' Prospectuses and Statement of Additional
Information.
3. Compensation of the Adviser. For the services to be rendered by
the Adviser as provided in Sections 1 and 2 of this Agreement,
the Trust shall pay to the Adviser compensation at the rate
specified in the Schedule(s) which are attached hereto and made a
part of this Agreement. Such compensation shall be paid to the
Adviser at the end of each month, and calculated by applying a
daily rate, based on the annual percentage rates as specified in
the attached Schedule(s), to the assets. The fee shall be based
on the average daily net assets for the month involved (less any
assets of such Portfolios held in non-interest bearing special
deposits with a Federal Reserve Bank).
All rights of compensation under this Agreement for services
performed as of the termination date shall survive the
termination of this Agreement.
4. Other Expenses. The Adviser shall pay all expenses of printing
and mailing reports, prospectuses, statements of additional
information, and sales literature relating to the solicitation of
prospective clients. The Trust shall pay all expenses relating to
mailing to existing shareholders prospectuses, statements of
additional information, proxy solicitation material and
shareholder reports.
5. Excess Expenses. If the expenses for any Portfolio for any fiscal
year (including fees and other amounts payable to the Adviser,
but excluding interest, taxes, brokerage costs, litigation, and
other extraordinary costs) as calculated every business day would
exceed the expense limitations imposed on investment companies by
any applicable statute or regulatory authority of any
jurisdiction in which shares of a Portfolio are qualified for
offer and sale, the Adviser shall bear such excess cost. However,
the Adviser will not bear expenses of any Portfolio which would
result in the Portfolio's inability to qualify as a regulated
investment company under provisions of the Internal Revenue Code.
Payment of expenses by the Adviser pursuant to this Section 5
shall be settled on a monthly basis (subject to fiscal year end
reconciliation) by a reduction in the fee payable to the Adviser
for such month pursuant to Section 3 and, if such reduction shall
be insufficient to offset such expenses, by reimbursing the
Trust.
6. Reports. The Trust and the Adviser agree to furnish to each
other, if applicable, current prospectuses, proxy statements,
reports to shareholders, certified copies of their financial
statements, and such other information with regard to their
affairs as each may reasonably request.
7. Status of Adviser. The services of the Adviser to the Trust are
not to be deemed exclusive, and the Adviser shall be free to
render similar services to others so long as its services to the
Trust are not impaired thereby. The Adviser shall be deemed to be
an independent contractor and shall, unless otherwise expressly
provided or authorized, have no authority to act for or represent
the Trust in any way or otherwise be deemed an agent of the
Trust.
8. Certain Records. Any records required to be maintained and
preserved pursuant to the provisions of Rule 31a-1 and Rule 31a-2
promulgated under the Investment Company Act of 1940 which are
prepared or maintained by the Adviser on behalf of the Trust are
the property of the Trust and will be surrendered promptly to the
Trust on request.
9. Limitation of Liability of Adviser. The duties of the Adviser
shall be confined to those expressly set forth herein, and no
implied duties are assumed by or may be asserted against the
Adviser hereunder. The Adviser shall not be liable for any error
of judgment or mistake of law or for any loss arising out of any
investment or for any act or omission in carrying out its duties
hereunder, except a loss resulting from willful misfeasance, bad
faith or gross negligence in the performance of its duties, or by
reason of reckless disregard of its obligations and duties
hereunder, except as may otherwise be provided under provisions
of applicable state law or Federal securities law which cannot be
waived or modified hereby. (As used in this Paragraph 9, the term
"Adviser" shall include directors, officers, employees and other
corporate agents of the Adviser as well as that corporation
itself).
10. Permissible Interests. Trustees, agents, and shareholders of the
Trust are or may be interested in the Adviser (or any successor
thereof) as directors, partners, officers, or shareholders, or
otherwise; directors, partners, officers,
agents, and shareholders of the Adviser are or may be interested
in the Trust as Trustees, shareholders or otherwise; and the
Adviser (or any successor) is or may be interested in the Trust
as a shareholder or otherwise. In addition, brokerage
transactions for the Trust may be effected through affiliates of
the Adviser if approved by the Board of Trustees, subject to the
rules and regulations of the Securities and Exchange Commission.
11. License of Adviser's Name. The Adviser hereby agrees to grant a
license to the Trust for use of its name in the names of the
Portfolios for the term of this Agreement and such license shall
terminate upon termination of this Agreement.
12. Duration and Termination. This Agreement, unless sooner
terminated as provided herein, shall remain in effect until two
years from date of execution, and thereafter, for periods of one
year so long as such continuance thereafter is specifically
approved at least annually (a) by the vote of a majority of those
Trustees of the Trust 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, and (b) by the
Trustees of the Trust or by vote of a majority of the outstanding
voting securities of each Portfolio; provided, however, that if
the shareholders of any Portfolio fail to approve the Agreement
as provided herein, the Adviser may continue to serve hereunder
in the manner and to the extent permitted by the Investment
Company Act of 1940 and rules and regulations thereunder. The
foregoing requirement that continuance of this Agreement be
"specifically approved at least annually" shall be construed in a
manner consistent with the Investment Company Act of 1940 and the
rules and regulations thereunder.
This Agreement may be terminated as to any Portfolio at any time,
without the payment of any penalty by vote of a majority of the
Trustees of the Trust or by vote of a majority of the outstanding
voting securities of the Portfolio on not less than 30 days nor
more than 60 days written notice to the Adviser, or by the
Adviser at any time without the payment of any penalty, on 90
days written notice to the Trust. This Agreement will
automatically and immediately terminate in the event of its
assignment. Any notice under this Agreement shall be given in
writing, addressed and delivered, or mailed postpaid, to the
other party at any office of such party. As used in this Section
11, the terms "assignment", "interested persons", and a "vote of
a majority of the outstanding voting securities" shall have the
respective meanings set forth in the Investment Company Act of
1940 and the rules and regulations thereunder; subject to such
exemptions as may be granted by the Securities and Exchange
Commission under said Act.
13. Notice. Any notice required or permitted to be given by either
party to the other shall be deemed sufficient if sent by
registered or certified mail, postage prepaid, addressed by the
party giving notice to the other party at the last address
furnished by the other party to the party giving notice: if to
the Trust, at Xxxx, XX 00000 and if to the Adviser at 00 Xxxxx
Xxxxxxx Xxxxxx Xxxx, Xxxxxxxxx, XX 00000.
14. Severability. If any provision 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.
15. Governing Law. This Agreement shall be construed in accordance
with the laws of the Commonwealth of Massachusetts and the
applicable provisions of the 1940 Act. To the extent that the
applicable laws of the Commonwealth of Massachusetts, or any of
the provisions herein, conflict with the applicable provisions of
the 1940 Act, the latter shall control.
A copy of the Declaration of Trust of the Trust is on file with the Secretary of
The Commonwealth of Massachusetts, and notice is hereby given that this
instrument is executed on behalf of the Trustees of the Trust as Trustees, and
are not binding upon any of the Trustees, officers, or shareholders of the Trust
individually but binding only upon the assets and property of the Trust.
Further, the obligations of the Trust with respect to any one Portfolio shall
not be binding upon any other Portfolio.
IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed
as of the day and year first written above.
TIP FUNDS
By:_____________________________
Attest:_________________________
CLOVER CAPITAL MANAGEMENT, INC.
By:_____________________________
Attest:_________________________
Schedule A dated May ____, 1997
to the
Investment Advisory Agreement
dated May ______ 1997
between
TIP Funds
and
Clover Capital Management, Inc.
Pursuant to Article 3, the Trust shall pay the Adviser compensation at an annual
rate as follows:
Portfolio Fee (in basis points)
------------------------- ----------------------
Clover Equity Value Fund .74% of the average daily net assets
Clover Small Cap Value Fund .85% of the average daily net assets
Clover Fixed Income Fund .45% of the average daily net assets
