CONSULTING GROUP CAPITAL MARKET FUNDS INVESTMENT ADVISORY AGREEMENT
CONSULTING
GROUP CAPITAL MARKET FUNDS
INVESTMENT
ADVISORY AGREEMENT, effective as of the 27th day of
August
2007, between the Consulting Group, a division of Citigroup Investment Advisory
Services, Inc. (“Manager”), a corporation organized and existing under the laws
of the State of Delaware, and Xxxxxxxx Investment Management North America
Inc.
(“Adviser”), a Delaware corporation, registered with the U.S. Securities and
Exchange Commission as an investment adviser under the Investment Advisers
Act
of 1940, as amended (the “Advisers Act”);
WHEREAS,
the Manager has entered into a Management Agreement dated as of the first day
of
December, 2005 (the “Management Agreement”) with Consulting Group Capital Market
Funds, a Massachusetts business trust (the “Trust”), which is engaged in
business as an open-end management investment company registered under the
Investment Company Act of 1940, as amended, (“1940 Act”); and
WHEREAS,
the Trust is and will continue to be a series fund having two or more investment
portfolios, each with its own assets, investment objectives, policies and
restrictions (each a “Portfolio”); and
WHEREAS,
the Adviser is engaged principally in the business of rendering investment
advisory services and is registered as an investment adviser under the Advisers
Act; and
WHEREAS,
the Manager desires to retain the Adviser to assist it in the provision of
a
continuous investment program for that portion of the assets of the Portfolio
listed on Appendix A which the Manager may from time to time assign to the
Adviser (the “Allocated Assets”) and the Adviser is willing to furnish such
services; provided that such portion shall be approved by the Trust’s Board of
Trustees and changes to any such assignment affecting more than 10% of any
Portfolio’s assets shall also be approved by the Trust’s Board of
Trustees;
NOW,
THEREFORE, in consideration of the premises and mutual promises herein set
forth, the parties hereto agree as follows:
1.
APPOINTMENT. Manager hereby retains the Adviser to act as investment adviser
for
and to manage the Allocated Assets for the period and on the terms set forth
in
this Agreement. The Adviser accepts such employment and agrees to render the
services herein set forth, for the compensation herein provided.
2.
DUTIES
OF THE ADVISER.
A.
INVESTMENT ADVISORY SERVICES. Subject to the supervision of the Trust’s Board of
Trustees (the “Board”) and the Manager, the Adviser shall manage the investments
of the Allocated Assets in accordance with the Portfolio’s investment objective,
policies, and restrictions as provided in the Trust’s Prospectus and Statement
of Additional Information, as currently in effect and as amended or supplemented
from time to time (hereinafter referred to as the “Prospectus”), and in
compliance with the requirements applicable to registered investment companies
under applicable laws and those requirements applicable to regulated investment
companies under Subchapter M of the Internal Revenue Code of 1986, as amended
(“Code”) and such other limitations as the Manager may institute. Any such
amendments or supplements to the Prospectus that could affect the Manager’s
management of the Allocated Assets shall be provided in writing to the Manager
in with as much advance notice as reasonably possible and not less than 5
business days. The Adviser shall (a) make investment decisions for the Allocated
Assets; (b) place purchase and sale orders for portfolio transactions for the
Allocated Assets; and (c) employ professional portfolio managers and securities
analysts to provide research services to the Allocated Assets. In providing
these services, the Adviser will conduct a continual program of investment,
evaluation and, if appropriate, sale and reinvestment of the Allocated
Assets.
B.
ADVISER UNDERTAKINGS. In all matters relating to the performance of this
Agreement, the Adviser shall act in conformity with the Trust’s Master Agreement
dated April 12, 1991, as amended from time to time (the “Trust Agreement”) and
Prospectus and with the written instructions and directions of the Board and
the
Manager. The Adviser hereby agrees to:
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(i)
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regularly
report to the Board and the Manager (in such form and frequency as
the
Manager and Adviser mutually agree) with respect to the implementation
of
the investment program, compliance of the Allocated Assets with the
Prospectus, the 1940 Act and the Code, and on other topics as may
reasonably be requested by the Board or the Manager, including attendance
at Board meetings, as reasonably requested, to present such reports
to the
Board;
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(ii)
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comply
with valuation procedures adopted by Board, including any amendments
thereto, and consult with the Trust’s pricing agent regarding the
valuation of securities that are not registered for public sale,
not
traded on any securities markets, or otherwise may require fair
valuation;
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(iii)
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provide,
subject to any obligations or undertakings reasonably necessary to
maintain the confidentiality of the Adviser’s nonpublic information, any
and all information, records and supporting documentation about the
composite of accounts and the portfolios the Adviser manages that
have
investment objectives, policies, and strategies substantially similar
to
those employed by the Adviser in managing the Allocated Assets which
may
be reasonably necessary, under applicable laws, to allow the Trust
or its
agent to present historical performance information concerning the
Adviser’s similarly managed accounts and portfolios, for inclusion in the
Trust’s Prospectus and any other reports and materials prepared by the
Trust or its agent, provided that the information to be included
and the
manner it is presented shall be in accordance with regulatory requirements
and industry standards or as requested by applicable federal or state
regulatory authorities; and
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(iv)
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review
schedules of the Allocated Assets periodically provided to the Adviser
by
the Manager and promptly confirm to the Manager the concurrence of
the
Adviser’s records with such
schedules.
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C.
EXPENSES. The Adviser will bear all of its expenses in connection with the
performance of its services under this Agreement. All other expenses to be
incurred in the operation of the Portfolio will be borne by the Trust, except
to
the extent specifically assumed by the Adviser in writing. The expenses to
be
borne by the Trust include, without limitation, the following: organizational
costs, taxes, interest, brokerage fees and commissions, Trustees’ fees,
Securities and Exchange Commission fees and state Blue Sky qualification fees,
advisory fees, charges of custodians, transfer and dividend disbursing agents’
fees, certain insurance premiums, industry association fees, outside auditing
and legal expenses, costs of independent pricing services, costs of maintaining
existence, costs attributable to investor services (including, without
limitation, telephone and personnel expenses), costs of preparing and printing
prospectuses and statements of additional information for regulatory purposes
and for distribution to existing shareholders, costs of shareholders’ reports
and meetings, and any extraordinary expenses.
D.
BROKERAGE. The Adviser will select brokers and dealers to effect all orders
for
the purchase and sale of Allocated Assets. In selecting brokers or dealers
to
execute transactions on behalf of the Allocated Assets of the Portfolio, the
Adviser will use its best efforts to seek the best overall terms available.
In
assessing the best overall terms available for any transaction, the Adviser
will
consider factors it deems relevant, including, without limitation, the breadth
of the market in the security or commodity interest, the price of the security
or commodity interest, the financial condition and execution capability of
the
broker or dealer and the reasonableness of the commission, if any, for the
specific transaction and on a continuing basis. In selecting brokers or dealers
to execute a particular transaction, and in evaluating the best overall terms
available, the Adviser is authorized to consider the brokerage and research
services (within the meaning of Section 28(e) of the Securities Exchange Act
of
1934, as amended) provided to the Portfolio and/or other accounts over which
the
Adviser exercises investment discretion. Except as permitted by Rule 17a-l0
under the 1940 Act, Adviser will not engage in principal transactions with
respect to the Allocated Assets with any broker-dealer affiliated with the
Manager or with any other adviser to the Portfolio, and will engage in agency
transactions with respect to the Allocated Assets with such affiliated
broker-dealers only in accordance with all applicable rules and regulations.
Adviser will provide a list of its affiliated broker-dealers to Manager, as
such
may be amended from time to time. Manager will provide to Adviser a list of
its
affiliated broker-dealers and of those of each other adviser to the
Portfolio.
E.
AGGREGATION OF ORDERS. On occasions when the Adviser deems the purchase or
sale
of a security to be in the best interest of the Allocated Assets as well as
other clients of the Adviser, the Adviser may to the extent permitted by
applicable laws and regulations, but shall be under no obligation to, aggregate
the orders for securities to be purchased or sold. In such event, allocation
of
the securities so purchased or sold, as well as the expenses incurred in the
transaction, will be made by the Adviser in the manner the Adviser considers
to
be the most equitable and consistent with its fiduciary obligations to the
Portfolio and to its other clients. The Manager recognizes that, in some cases,
the Adviser’s allocation procedure may limit the size of the position that may
be acquired or sold for the Allocated Assets.
F.
BOOKS
AND RECORDS. In compliance with the requirements of Rule 31a-3 under the 1940
Act, the Adviser hereby agrees that all records which it maintains for the
Allocated Assets of the Portfolio are the property of the Trust and further
agrees to surrender promptly to the Trust copies of any of such records upon
the
Portfolio’s or the Manager’s request, provided, however, that Adviser may retain
copies of any records to the extent required for it to comply with applicable
laws. The Adviser further agrees to preserve for the periods prescribed by
Rule
31a-2 under the 1940 Act the records relating to its activities hereunder
required to be maintained by Rule 31a-1 under the 1940 Act and to preserve
the
records relating to its activities hereunder required by Rule 204-2 under the
Advisers Act for the period specified in said Rule. Notwithstanding the
foregoing, Adviser has no responsibility for the maintenance of the records
of
the Portfolio, except for those related to the Allocated Assets.
G.
ADVISER COMPLIANCE RESPONSIBILITIES. The Adviser and the Manager acknowledge
that the Adviser is not the compliance agent for the Portfolio, and does not
have access to all of the Trust’s books and records necessary to perform certain
compliance testing. However, to the extent that the Adviser has agreed to
perform the services specified in this Agreement, the Adviser shall perform
compliance testing with respect to the Allocated Assets based upon information
in its possession and upon information and written instructions received from
the Manager or the Trust’s Administrator and shall not be held in breach of this
Agreement so long as it performs in accordance with such information and
instructions. Specifically, the Adviser shall not be responsible for the
Portfolio being in violation of any applicable law or regulation or investment
policy or restriction applicable to the Portfolio as a whole or for the
Portfolio’s failure to qualify as a regulated investment company under the Code
if the securities and other holdings of the Allocated Assets would not be in
such violation or fail to so qualify if the Allocated Assets were deemed a
separate series of the Trust or a separate regulated investment company under
the Code. The Manager or Trust’s Administrator shall promptly provide the
Adviser with copies of the Trust Agreement, the Trust’s By-Laws, the Prospectus
and any written policies or procedures adopted by the Board applicable to the
Allocated Assets and any amendments or revisions thereto. Adviser shall supply
such reports or other documentation as reasonably requested from time to time
by
the Manager to evidence Adviser’s compliance with such Prospectus, policies or
procedures.
H.
PROXY
VOTING. The Adviser shall use its good faith judgment in a manner which it
reasonably believes best serves the interests of the Portfolio’s shareholders to
vote or abstain from voting all proxies solicited by or with respect to the
issuers of securities in the Allocated Assets. The Manager shall cause to be
forwarded to Adviser all proxy solicitation materials that Manager receives.
Adviser agrees that it has adopted written proxy voting procedures that comply
with the requirements of the 1940 Act and the Advisers Act. The Adviser further
agrees that it will provide the Board as the Board may reasonably request,
with
a written report of the proxies voted during the most recent 12-month period
or
such other period as the Board may designate, in a format that shall comply
with
the 1940 Act. Upon reasonable request, Adviser shall provide the Manager with
all proxy voting records relating to the Allocated Assets, including but not
limited to those required by Form N-PX. Adviser will also provide an annual
certification, in a form reasonably acceptable to Manager, attesting to the
accuracy and completeness of such proxy voting records.
I.
USE OF
NAMES. The Adviser shall not use the name, logo, insignia, or other identifying
xxxx of the Trust or the Manager or any of their affiliates or any derivative
or
logo or trade or service xxxx thereof, or disclose information related to the
business of the Manager or any of its affiliates in material relating to the
Adviser in any manner not approved prior thereto by the Manager; provided,
however, that the Manager hereby approves all uses of its or the Trust’s name
and that of their affiliates which merely refer in accurate terms to the
appointment of the Adviser hereunder or which are required by the SEC or a
state
securities commission; and provided, further, that in no event shall such
approval be unreasonably withheld. The Manager shall not use the name, logo,
insignia, or other identifying xxxx of the Adviser or any of its affiliates
in
any prospectus, sales literature or other material relating to the Trust in
any
manner not approved prior thereto by the Adviser; provided, however, that the
Adviser hereby approves all uses of its name which merely refer in accurate
terms to the appointment of the Adviser hereunder or which are required by
the
SEC or a state securities commission; and provided, further that in no event
shall such approval be unreasonably withheld.
J.
OTHER
ADVISERS. With respect to any Portfolio, (i) the Adviser will not consult with
any other adviser to that Portfolio (including, in the case of an offering
of
securities subject to Section 10(f) of the 1940 Act, any adviser that is a
principal underwriter or an affiliated person of a principal underwriter of
such
offering) concerning transactions for that Portfolio in securities or other
assets, except, in the case of transactions involving securities of persons
engaged in securities-related businesses, for purposes of complying with the
conditions of paragraphs (a) and (b) of Rule 12d3-1 under the 1940 Act; and
provided, however, that the Adviser may engage its affiliate, Xxxxxxxx
Investment Management North America Limited (the “Subadvisory Affiliate”), to
act as subadviser to perform investment advisory services with respect to the
Allocated Assets of the Portfolio and this prohibition shall not apply to
consultations with the Subadvisory Affiliate; and (ii) the Adviser will provide
advice and otherwise perform services hereunder exclusively with respect to
the
Allocated Assets of that Portfolio.
K.
PORTFOLIO HOLDINGS. The Adviser will not disclose, in any manner whatsoever,
any
list of securities held by the Portfolio, except in accordance with the
Portfolio’s portfolio holdings disclosure policy.
3.
COMPENSATION OF ADVISER. The Manager will pay the Adviser, with respect to
each
Portfolio on Appendix A attached hereto, the compensation specified in Appendix
A. Such fees will be computed daily and paid monthly, calculated at an annual
rate based on the Allocated Assets’ average daily net assets as determined by
the Trust’s accounting agent. Compensation for any partial period shall be
pro-rated based on the length of the period.
4.
STANDARD OF CARE. The Adviser shall exercise its best judgment in rendering
its
services described in this Agreement. Except as may otherwise be required by
the
1940 Act or the rules thereunder or other applicable law, the Adviser shall
not
be liable for any error of judgment or mistake of law or for any loss suffered
by the Portfolio or the Manager in connection with the matters to which this
Agreement relates, except a loss resulting from Adviser’s willful misfeasance,
bad faith or gross negligence on its part in the performance of its duties
hereunder or from reckless disregard by it of its obligations and duties under
this Agreement.
5.
INDEMNIFICATION.
A.
The
Manager agrees to indemnify and hold harmless the Adviser from and against
any
and all claims, losses, liabilities or damages (including reasonable attorneys’
fees and other related expenses) (“Losses”), howsoever arising, from or in
connection with this Agreement or the performance by the Adviser of its duties
hereunder; provided however that the Manager will not indemnify the Adviser
for
Losses resulting from the Adviser’s willful misfeasance, bad faith or gross
negligence in the performance of its duties or from the Adviser’s reckless
disregard of its obligations and duties under this Agreement.
B.
The
Adviser agrees to indemnify and hold harmless the Manager from and against
any
and all Losses resulting from the Adviser’s willful misfeasance, bad faith, or
gross negligence in the performance of, or from reckless disregard of, the
Adviser’s obligations and duties under this Agreement; provided however that the
Adviser will not indemnify the Manager for Losses resulting from the Manager’s
willful misfeasance, bad faith or gross negligence in the performance of its
duties or from the Manager’s reckless disregard of its obligations and duties
under this Agreement.
6.
NON-EXCLUSIVITY. The services of the Adviser to the Manager with respect to
the
Allocated Assets are not to be deemed to be exclusive, and the Adviser and
its
affiliates shall be free to render investment advisory or other services to
others (including other investment companies) and to engage in other activities.
It is understood and agreed that the directors, officers, and employees of
the
Adviser are not prohibited from engaging in any other business activity or
from
rendering services to any other person, or from serving as partners, officers,
directors, trustees, or employees of any other firm or corporation, including
other investment companies. Manager acknowledges that Adviser or its affiliates
may give advice and take actions in the performance of its duties to clients
which differ from the advice, or the timing and nature of actions taken, with
respect to other clients’ accounts (including the Allocated Assets) or employee
accounts which may invest in some of the same securities recommended to advisory
clients. In addition, advice provided by the Adviser may differ from advice
given by its affiliates.
7.
MAINTENANCE OF INSURANCE. During the term of this Agreement and for a period
of
one year after the termination hereof, Adviser will maintain comprehensive
general liability coverage and will carry a fidelity bond covering it and each
of its employees and authorized agents with limits of not less than those
considered commercially reasonable and appropriate under current industry
practices. Adviser shall promptly notify Manager of any termination of said
coverage.
8.
CONFIDENTIALITY. Each party to this Agreement shall keep confidential any
nonpublic information concerning the other party and will not use or disclose
such information for any purpose other than the performance of its
responsibilities and duties hereunder, unless the non-disclosing party has
authorized such disclosure or if such disclosure is expressly required or
requested by applicable federal or state regulatory authorities. Nonpublic
information shall not include information a party to this Agreement can clearly
establish was (a) known to the party prior to this Agreement; (b) rightfully
acquired by the party from third parties whom the party reasonably believes
are
not under an obligation of confidentiality to the other party to this Agreement;
(c) placed in public domain without fault of the party or its affiliates; or
(d)
independently developed by the party without reference or reliance upon the
nonpublic information.
9.
TERM
OF AGREEMENT. This Agreement shall become effective as of the date of its
execution and shall continue in effect for a period of two years from the date
of execution. Thereafter, this Agreement shall continue automatically for
successive annual periods, provided such continuance is specifically approved
at
least annually by (i) the Board or (ii) a vote of a “majority” (as defined in
the 0000 Xxx) of the Portfolio’s outstanding voting securities, provided that in
either event the continuance also is approved by a majority of the Board who
are
not “interested persons” (as defined in the 0000 Xxx) of any party to this
Agreement, by vote cast in person at a meeting called for the purpose of voting
on such approval. This Agreement is terminable, without penalty, at any time,
by
the Manager, by the Board, or by vote of holders of a majority of the
Portfolio’s shares; or on 60 days’ written notice by the Adviser, and will
terminate five business days after the Adviser receives written notice of the
termination of the Management Agreement between the Trust and the Manager,
or
five business days after the termination, whichever is later. In the event
of
such termination, Manager shall not be entitled to any fees beyond the date
of
the termination. This Agreement also will terminate automatically in the event
of its assignment (as defined in the 1940 Act).
10.
REPRESENTATIONS OF ADVISER. The Adviser represents, warrants, and agrees as
follows:
A.
The
Adviser: (i) is registered as an investment adviser under the Advisers Act
and
will continue to be so registered for so long as this Agreement remains in
effect; (ii) is not prohibited by the 1940 Act or the Advisers Act from
performing the services contemplated by this Agreement; (iii) has met, and
will
continue to meet for so long as this Agreement remains in effect, any other
applicable federal or state requirements, or the applicable requirements of
any
regulatory or industry self-regulatory organization, necessary to be met in
order to perform the services contemplated by this Agreement; (iv) has the
authority to enter into and perform the services contemplated by this Agreement;
and (v) will promptly notify the Manager of the occurrence of any event that
would disqualify the Adviser from serving as an investment adviser of an
investment company pursuant to Section 9(a) of the 1940 Act or otherwise. The
Adviser has provided the information about itself set forth in the Prospectus
and has reviewed the description of its operations, duties and responsibilities
as set forth therein and acknowledges that they are true and correct and contain
no material misstatement or omission, and it further agrees to inform the
Manager and the Trust’s Administrator immediately of any material fact known to
the Adviser respecting or relating to the Adviser that is not contained in
the
Prospectus, or of any statement contained therein which becomes untrue in any
material respect.
B.
The
Adviser has adopted a written code of ethics complying with the requirements
of
Rule 17j-1 under the 1940 Act and, if it has not already done so, will provide
the Manager and the Trust with a copy of such code of ethics. On at least an
annual basis, the Adviser will comply with the reporting requirements of Rule
17j-1, which may include (i) certifying to the Manager that the Adviser and
its
Access Persons have complied with the Adviser’s Code of Ethics with respect to
the Allocated Assets and (ii) identifying any material violations which have
occurred with respect to the Allocated Assets. Upon the reasonable request
of
the Manager, the Adviser shall permit the Manager, its employees or its agents
to examine the reports required to be made by the Adviser pursuant to Rule
17j-1
and all other records relevant to the Adviser’s code of ethics.
C.
Adviser has adopted and implemented written policies and procedures, as required
by Rule 206(4)-7 under the Advisers Act, which are reasonably designed to
prevent violations of federal securities laws by the Adviser, its employees,
officers and agents. Upon reasonable request, Adviser shall provide the Manager
with access to the records relating to such policies and procedures as they
relate to the Allocated Assets. Adviser will also provide, at the reasonable
request of the Manager, periodic certifications, in a form reasonably acceptable
to the Manager, attesting to such written policies and procedures.
D.
The
Adviser has provided the Manager and the Trust with a copy of its registration
under the Advisers Act on Form ADV as most recently filed with the SEC and
hereafter will furnish a copy of its annual amendment to the Manager. The
statements contained in the Adviser’s registration on Form ADV are true and
correct in all material respects and do not omit to state any material fact
required to be stated therein or necessary in order to make the statements
therein not misleading. The Adviser agrees to maintain the completeness and
accuracy of its registration on Form ADV in accordance with the Advisers Act.
The Adviser acknowledges that it is an “investment adviser” to the Fund with
respect to the Allocated Assets within the meaning of the 1940 Act and the
Advisers Act.
E.
The
Adviser confirms that, to its knowledge, neither it nor any of its “affiliated
persons”, as defined in the 1940 Act, are affiliated persons of: (i) the
Manager, (ii) any other adviser to the Portfolio or any affiliated person of
such adviser, other than the Subadvisory Affiliate; (iii) Citigroup Global
Markets Inc, the distributor for the Trust; or (iv) any trustee or officer
of
the Trust.
11.
PROVISION OF CERTAIN INFORMATION BY ADVISER. The Adviser will promptly notify
the Manager (1) in the event the SEC or other governmental authority has
censured the Adviser; placed limitations upon its activities, functions or
operations; suspended or revoked its registration, if any, as an investment
adviser; or has commenced proceedings or an investigation that may result in
any
of these actions or (2) upon having a reasonable basis for believing that the
Portfolio has ceased to qualify or might not qualify as a regulated investment
company under Subchapter M of the Code. The Adviser further agrees to notify
the
Manager promptly of any material fact known to the Adviser respecting or
relating to the Adviser that is not contained in the Prospectus, and is required
to be stated therein or necessary to make the statements therein not misleading,
or of any statement contained therein that becomes untrue in any material
respect. As reasonably requested by the Trust on behalf of the Trust’s officers
and in accordance with the scope of Adviser’s obligations and responsibilities
contained in this Agreement, Adviser will provide reasonable assistance to
the
Trust in connection with the Trusts’s compliance with the Xxxxxxxx-Xxxxx Act and
the rules and regulations promulgated by the SEC thereunder, and Rule 38(a)-1
of
the 1940 Act. Such assistance shall include, but not be limited to, (i)
certifying periodically, upon the reasonable request of the Trust, that it
is in
compliance with all applicable “federal securities laws”, as required by Rule
38a-l under the 1940 Act, and Rule 206(4)-7 under the Advisers Act; (ii)
facilitating and cooperating with third- party audits arranged by the Trust
to
evaluate the effectiveness of its compliance controls; (iii) providing the
Trust’s chief compliance officer with direct access to its compliance personnel;
(iv) providing the Trust’s chief compliance officer with periodic reports and
(v) promptly providing special reports in the event of compliance problems.
Further, Adviser is aware that: (i) the Chief Executive Officer (Principal
Executive Officer) and Treasurer/Chief Financial Officer (Principal Financial
Officer) of the Trust (collectively, “Certifying Officers”) are required to
certify the Trust’s periodic reports on Form N-CSR pursuant to Rule 30a-2 under
the 1940 Act; and (ii) the Certifying Officers must rely upon certain matters
of
fact generated by Adviser of which they do not have firsthand knowledge.
Consequently, Adviser has in place and has observed procedures and controls
that
are reasonably designed to ensure the adequacy of the services provided to
the
Trust under this Agreement and the accuracy of the information provided by
the
Adviser for inclusion in the Form N-CSR, and shall provide certifications to
the
Trust regarding these procedures and controls and the accuracy of the
information provided by the Adviser to be relied upon by the Certifying Officers
in certifying the Trust’s periodic reports on Form N-CSR, in a form satisfactory
to the Trust.
12.
PROVISION OF CERTAIN INFORMATION BY THE MANAGER. The Manager will promptly
notify the Adviser (1) in the event that the SEC has censured the Manager or
the
Trust; placed limitations upon either of their activities, functions, or
operations; suspended or revoked the Manager’s registration as an investment
adviser; or has commenced proceedings or an investigation that may result in
any
of these actions and (2) upon having a reasonable basis for believing that
the
Portfolio has ceased to qualify or might not qualify as a regulated investment
company under Subchapter M of the Code.
13.
AMENDMENT OF AGREEMENT. No provision of this Agreement may be changed, waived,
discharged, or terminated orally, but only by an instrument in writing signed
by
both parties.
14.
LIMITATION OF LIABILITY. The Manager and Adviser agree that the obligations
of
the Trust under this Agreement shall not be binding upon any of the Board
members, shareholders, nominees, officers, employees or agents; whether past,
present or future, of the Trust individually, but are binding only upon the
assets and property of the Portfolio, as provided in the Trust Agreement. The
execution and delivery of this Agreement have been duly authorized by the
Manager and the Adviser, and signed by an authorized officer of each acting
as
such.
15.
FORCE
MAJEURE. The Adviser shall not be responsible for any loss or damage, or failure
to comply or reasonable delay in complying with any duty or obligation, under
or
pursuant to this Agreement arising as a direct or indirect result of any reason,
cause or contingency beyond its reasonable control, including (without
limitation) natural disasters, nationalization, currency restrictions, act
of
war, act of terrorism, act of God, postal or other strikes or industrial
actions, or the failure, suspension or disruption of any relevant stock exchange
or market. The Adviser shall notify the Manager promptly when it becomes aware
of any event described above. The Manager shall not be responsible for temporary
delays in the performance of its duties and obligations hereunder and
correspondingly shall not be liable for any loss or damage attributable to
such
delay in consequence of any event described above.
16.
MISCELLANEOUS.
A.
GOVERNING LAW. This Agreement shall be construed in accordance with the laws
of
the State of New York, without giving effect to the conflicts of laws principles
thereof, and with the 1940 Act. To the extent that the applicable laws of the
State of New York conflict with the applicable provisions of the 1940 Act,
the
latter shall control.
B.
CHANGE
IN CONTROL. The Adviser will notify the Manager of any change of control of
the
Adviser or the Subadvisory Affiliate, including any change of its general
partners or 25% shareholders or 25% limited partners or 25% members, as
applicable, in each case prior to or promptly after such change. In addition,
the Adviser will notify the Manager of any changes in the key personnel who
are
either the portfolio manager(s) of the Allocated Assets or senior management
of
the Adviser as soon as practicable after such change.
C.
CAPTIONS. The captions contained in this Agreement are included for convenience
of reference only and in no way define or delimit any of the provisions hereof
or otherwise affect their construction or effect.
D.
ENTIRE
AGREEMENT. This Agreement represents the entire agreement and understanding
of
the parties hereto and shall supersede any prior agreements between the parties
relating to the subject matter hereof.
E.
DEFINITIONS. Any question of interpretation of any term or provision of this
Agreement having a counterpart in or otherwise derived from a term or provision
of the 1940 Act shall be resolved by reference to such term or provision of
the
1940 Act and to interpretations thereof, if any, by the United States courts
or,
in the absence of any controlling decision of any such court, by rules, releases
or orders of the SEC validly issued pursuant to the Act. As used in this
Agreement, the terms “majority of the outstanding voting securities,”
“affiliated person,” “interested person,” “assignment,” “broker,” “investment
adviser,” “net assets,” “sale,” “sell,” and “security” shall have the same
meaning as such terms have in the 1940 Act, subject to such exemptions as may
be
granted by the SEC by any rule, release or order. Where the effect of a
requirement of the federal securities laws reflected in any provision of this
Agreement is made less restrictive by a rule, release, or order of the SEC,
whether of special or general application, such provision shall be deemed to
incorporate the effect of such rule, release, or order.
F.
NOTICES. Any notice herein required is to be in writing and is deemed to have
been given to Adviser or Manager upon receipt of the same at their respective
addresses set forth below. All written notices required or permitted to be
given
under this Agreement will be delivered by personal service, by postage mail
return receipt requested or by facsimile machine or similar means of delivery
that provide evidence of receipt.
All
notices to Manager shall be sent to:
222
Delaware Aye, 0xx xxxxx
Xxxxxxxxxx,
XX 00000
Fax:
(000) 000-0000
Attention:
Xxxx Xxxxxxxxx
Title:
Chief Legal Officer
All
notices to Adviser shall be sent to:
Xxxxxxxx
Investment Management North America Inc.
000
Xxxxx
Xxxxxx
Xxx
Xxxx,
XX 00000
Attention:
Xxxxx Xxxxxxx-Xxxxx
Email:xxxxx.xxxxxxx-xxxxx@xx.xxxxxxxxx.xxx
G
DELIVERY OF FORM ADV. The Manager acknowledges receipt of the Adviser’s Form ADV
more than 48 hours prior to the execution of this Agreement.
If
the
terms and conditions described above are in accordance with your understanding,
kindly indicate your acceptance of this Agreement by signing and returning
to us
the enclosed copy of this Agreement.
|
THE
CONSULTING GROUP, A DIVISION OF CITIGROUP INVESTMENT ADVISORY SERVICES,
INC.
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||
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By:
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/s/
Xxxxx Xxxxxx
|
|
|
Name:
|
Xxxxx
Xxxxxx
|
|
|
Title:
|
Chief
Financial Officer
|
|
|
XXXXXXXX
INVESTMENT MANAGEMENT NORTH AMERICA INC.
|
||
|
By:
|
/s/
Xxxx X. Xxxxxxxx
|
|
|
Name:
|
Xxxx
X. Xxxxxxxx
|
|
|
Title:
|
Authorized
Signatory
|
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APPENDIX
A
ALLOCATED
ASSETS AND FEE SCHEDULE
The
portion of the assets of the Portfolio assigned to the Adviser (the “Allocated
Assets”) shall be 30%. The Manager shall notify the Advisor of changes to the
Allocated Assets from time to time in its discretion.
For
the
services provided by Adviser to the Allocated Assets, pursuant to the attached
Investment Advisory Agreement, the Manager will pay the Adviser a fee, computed
daily and payable monthly, based on the average daily net assets of the
Allocated Assets at the following annual rates of the average daily net assets
of the Allocated Assets as determined by the Trust’s accounting
agent:
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PORTFOLIO
|
RATE
0.40%
on first $100 million of average daily net assets, 0.35% on the next
$300
million, and 0.30% thereafter (all assets over $400
million)
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International
Equity Investments
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||
