Exhibit (d)
Management Contract Between
the Xxxxxxxxx-Xxxxxxxx Trust
and
XxXxxxxxxx, Xxxxxxx & Xxxxxxxxx, Inc.,
as amended
MANAGEMENT CONTRACT BETWEEN
THE XXXXXXXXX-XXXXXXXX TRUST
AND
XxXXXXXXXX, XXXXXXX & XXXXXXXXX
This Management Contract ( the "Contract"), dated as of the 13th day of
July, l992, is entered into by and between The Xxxxxxxxx-Xxxxxxxx Trust (the
"Trust") and XxXxxxxxxx, Xxxxxxx
& Xxxxxxxxx (the "Manager").
A. The Trust has engaged Money Management Associates ( the "Administrator") to
render or make available to the Funds, at their expense, all services needed for
management and operation of the Funds except for the management of the Funds'
investment portfolios.
B. The Trust wishes to engage the Manager, and the Manager wishes to be engaged,
to manage the Funds' investment portfolios.
WITNESSETH:
That in consideration of the mutual covenants hereinafter contained, it
is agreed as follows:
1. The Trust hereby employs the Manager to manage the investment and
reinvestment of the assets of each of the Funds comprising the Trust in
accordance with the investment objectives and policies as set forth in the
Trusts registration statement filed pursuant to the Investment Company Act of
1940 and the Securities Act of 1933 (the "Registration Statement") and subject
to the direction and control of the officers and Board of Trustees of the Trust,
for the period and on the terms set forth in this Contract. The Manager hereby
accepts such employment and agrees to render the services and to assume the
obligations herein set forth, for the compensation herein provided.
2. The Manager assumes and shall pay all expenses in connection with
the management of the investment and reinvestment of the portfolio assets of the
Funds, except that the Funds assume and shall pay all broker's commissions,
issue and transfer taxes chargeable to the Funds in connection with securities
transactions to which the Funds are a party.
3. In connection with the investment and reinvestment of the assets of
the Funds, the Manager is authorized on behalf of the Funds, to place orders for
the execution of the Funds' portfolio transactions in accordance with the
applicable policies of the Funds as set forth in the Trust's Registration
Statement, as such Registration Statement may be amended from time to time. The
Manager shall place orders for the purchase or sale of securities either
directly with the issuer or with a broker or dealer selected by the Manager. In
placing each Fund's securities trades, it is recognized that the Manager will
give primary consideration to securing the most favorable price and efficient
execution, so that each Fund's total cost or proceeds in each transaction will
be the most favorable under all the circumstances. Within the framework of this
policy, the Manager may consider the financial responsibility, research and
investment information, and other services provided by brokers or dealers who
may effect or be a party to any such transaction or other transactions to which
other clients of the Manager may be a party.
It is understood that it is desirable for the Funds that the Manager
have access to investment and market research and securities and economic
analyses provided by brokers and others. It is also understood that brokers
providing such services may execute brokerage transactions at a higher cost to
the Funds than might result from the allocation of brokerage to other brokers on
the basis of seeking the most favorable price and efficient execution.
Therefore, the purchase and sale of securities for the Funds may be made with
brokers who provide such research and analysis, subject to review by the Trust's
Board of Trustees from time to time with respect to the extent and continuation
of this practice to determine whether each fund benefits, directly or
indirectly, from such practice. It is understood by both parties that the
Manager may select broker-dealers for their execution of the funds portfolio
transactions who provide research and analysis as the Manager may lawfully and
appropriately use in its investment management and advisory capacities, whether
or not such research and analysis also may be useful to the Manager in
connection with its services to other clients.
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On occasions when the Manager deems the purchase or sale of a security
to be in the best interests of one or more of the Funds as well as of other
clients, the Manager, to the extent permitted by applicable laws and
regulations, may aggregate the securities to be so purchased or sold in order to
obtain the most favorable price or lower brokerage commissions and the most
efficient execution. 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
Manager in the manner it considers to be the most equitable and consistent with
its fiduciary obligations to the Funds and to such other clients.
4. As compensation for the services to be rendered and the charges and
expenses to be assumed and paid by the Manager as provided in Section 2, each
Fund shall pay the Manager an annual fee based the average daily net asset value
of the respective Fund in accordance with the following schedule:
Growth Fund...........................0.50% (one-half of one percent)
Emerging Growth Fund..................0.50% (one-half of one percent
Utility Income Fund...................0.35% (35/100's of one percent)
The fee will be paid monthly not later than the fifth (5th) business day of the
month following the month for which services have been provided. In the event of
termination of this contract, the fee shall be computed on the basis of the
period ending on the last business day on which this contract is in effect
subject to a pro rata adjustment based on the number of days elapsed in the
current month as a percentage of the total number of days in such month, and
such fee shall be payable on the date of termination of this Contract with
respect to such Fund. For purposes of calculating the Manager's fee, the value
of the net assets of each Fund shall be determined in the same manner as that
Fund uses to compute the value of its net assets in connection with the
determination of the net asset value of its shares, all as set forth more fully
in such Fund's current Prospectus and Statement of Additional Information.
Page 3
5. Subject to and in accordance with the Bylaws and Declaration of
Trust of the Trust and the Bylaws and Articles of Incorporation of the Manager
respectively, and the Investment Company Act of 1940, trustees, officers, agents
and shareholders of the Funds are or may be interested in the Manager or its
affiliates (or any successor thereof) as shareholders or officers, directors,
agents, or otherwise, and directors, officers, agents or shareholders of the
Manager or its affiliates are or may be interested in the Fund as trustees,
officers, agents, shareholders or otherwise, and the Manager or its affiliates
may be interested in the Fund as shareholders or otherwise; and the effect of
any such interrelationships shall be governed by said governing instruments and
the applicable provisions of the Investment Company Act of 1940. The Manager
shall notify the Trust of any change in ownership or control of XxXxxxxxxx,
Xxxxxxx & Xxxxxxxxx that causes an "assignment" of this Contract (as the term
"assignment" is defined in the Investment Company Act of 1940 and the rules and
regulations promulgated thereunder) within a reasonable time after such change.
6. During the term of this Contract, the Trust agrees (A) to provide
the Manager with copies of all prospectuses, statements of additional
information, proxy statements, registration statements, reports to shareholders,
sales literature, and other material prepared for distribution to shareholders
of the Trust or the public that refer in any way to the Manager not later than
the date such material is first distributed to the public, or sooner if
practicable, and the Trust shall not use such material, or shall discontinue use
of such material, if the Manager reasonably objects in writing within five
business days (or within such other time as may be mutually agreed) after the
Manager's receipt thereof; (B) to provide the Manager with true and correct
copies of each amendment or supplement to the Trust's Registration Statement
(including any prospectus and statement of additional information included
therein), By-Laws and Declaration of Trust not later than the date such
amendment or supplement first becomes effective, or sooner if practicable; and
(C) to provide the Manager with (i) written notice of any resolutions, policies,
restrictions or procedures adopted by the Trust's Board of Trustees which affect
the Manager's investment management responsibilities hereunder, and (ii) a list
of every natural person or entity deemed by the Trust to be an "affiliated
person or promoter of or principal underwriter for the Trust or an affiliated
person of such person," as such terms are defined or used in Sections 2(a) (3),
2(a) (29), 2(a) (30) and 17 of the Investment Company Act of 1940, and the Trust
shall promptly notify the Manager of any additions or deletions to such list.
Page 4
7. This contract shall become effective with respect to such Fund on
the date first above written, and continue in effect until the first meeting of
the shareholders of such Fund occurring subsequent to the date hereof (but in no
event longer than two years from the date hereof), and if approved at such
shareholders' meeting, until two years from the date hereof, and thereafter only
so long as such continuance is approved with respect to such Fund at least
annually by a vote of a majority of the Trust's Board of Trustees, including the
votes of a majority of the Trustees who are not parties to such contract or
interested persons of any such party, cast in person at a meeting called for the
purpose of voting such approval. Provided, however, that (a) this Contract may
be terminated without penalty either by vote of the Board of Trustees of the
Trust or by vote of a majority of the outstanding voting securities of such
Fund, on sixty-days prior written notice to the Manager, (b) this Contract shall
automatically terminate in the event of its assignment (within the meaning of
the Investment Company Act of 1940), and (c) this Contract may be terminated by
the Manager on sixty-days prior written notice to the Trust. Any notice under
this Contract shall be given as provided in Section (11) below. As used in this
Contract, the terms "interested persons" and "vote of a majority of the
outstanding securities" shall have the respective meanings set forth in Section
2(a) (19) and Section 2(a) (42) of the Investment Company Act of 1940.
8. The services of the Manager to the Trust hereunder are not to be
deemed exclusive, and the Manager and each of its affiliates shall be free to
render similar services to others so long as its services hereunder are not
impaired thereby. The Manager shall for purposes herein 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.
9. No provisions of this Contract shall be deemed to protect the
Manager against any liability to the Trust or its shareholders to which it
otherwise would be subject by reason of any willful misfeasance, bad faith or
gross negligence in the performance of its duties or the reckless disregard of
its obligations under this Contract. Nor shall any provisions hereof be deemed
to protect any trustee or officer of the Trust against any such liability to
which he might otherwise be subject by reason of any willful misfeasance, bad
faith or gross negligence in the performance of his duties or the reckless
disregard of his obligations. In the absence of willful misfeasance, bad faith,
gross negligence, or reckless disregard of its obligations or duties hereunder,
the Manager shall not br subject to liability to the Trust, any of the Funds or
to any shareholder of any Fund for any act or omission in the course of
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or connected with, rendering services hereunder or for any losses that may be
sustained in the purchase, holding or sale of any security or other property by
any of the Funds. The Manager shall not be required to do or refrain from doing
or concur in anything which (by act or omission to act)may impose any liability
on it. Any person, even though also an officer, director, partner, employee or
agent of the Manager, who may be or become an officer, trustee, employee or
agent of the Trust, shall be deemed when rendering services to the Trust or
acting on any business of the Trust to be rendering such services to or acting
solely for the Trust and not as the Manager's officer, director, partner,
employee or agent or as one under the Manager's control or direction even though
paid by the Manager. The Manager shall not be required to take any legal action
on behalf of the Trust unless fully indemnified to the Manager's reasonable
satisfaction for all costs and liabilities likely to be incurred or suffered by
it. If the Trust requires the Manager to take any action which in the Manager's
opinion may make the Manager liable for payment of monies or liable in any other
way, the Manager shall be and kept indemnified in any reasonable amount and form
satisfactory to it as a prerequisite to taking such action. If any provision of
this Contract shall be held or made invalid by a court decision, statute, rule
or otherwise, the remainder of this contract shall not be affected thereby.
10. The Trust represents and warrants that it is duly registered with
the Securities and Exchange Commission under the Investment Company Act of 1940
as an open-end management investment company, and that all required action has
been taken by the Trust under the Securities Act of 1933 and the Investment
Company Act of 1940 to permit the public offering of and to consummate the sale
of, the shares of beneficial interest in the Trust pursuant to its current
prospectus.
11. All notices or other communications required or permitted to be
given hereunder shall be in writing and shall be delivered or sent by prepaid,
first class letter posted to the following addresses, or to such other address
as shall be designated in a notice given in accordance with this section, and
such notice shall be deemed to have been given at the time of delivery of, if
sent by post, five weekdays after posting by airmail.
Page 6
If to the Trust:
Xxxxxxxxx-Xxxxxxxx Trust
0000 Xxxxxxxx Xxxxxx
Xxxxxxxx, XX 00000
If to the Manager:
XxXxxxxxxx, Xxxxxxx & Xxxxxxxxx
000 Xxxxxxxxxx Xxxxxx
Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
12. This Contract shall be governed by and construed in accordance with
the laws of the State of California applicable to contracts between California
residents to be entered into and performed entirely within California.
IN WITNESS WHEREOF, the parties hereto have caused this Contract to be executed
on the date first above written.
WITNESS: THE XXXXXXXXX-XXXXXXXX TRUST
/s/Xxxxxx X'Xxxxxx
By: President and Treasurer
WITNESS: XxXXXXXXXX, XXXXXXX & XXXXXXXXX
/s/Xxxxx X. Xxxxxxxxx
By: President
Page 7
AMENDMENT
TO
MANAGEMENT CONTRACT
BETWEEN
XXXXXXXXX-XXXXXXXX TRUST
AND
XxXXXXXXXX, XXXXXXX & XXXXXXXXX, INC.
The following amendment is hereby made to the Management Contract dated
July 13, 1992 between the Xxxxxxxxx-Xxxxxxxx Trust and XxXxxxxxxx, Xxxxxxx &
Xxxxxxxxx, Inc. The following paragraph is added to Section 4 of said contract:
As compensation for the services to be rendered and the charges and
expenses to be assumed and paid by the manager as provided in Section 2, the
Gold Fund of the Trust shall pay the Manager an annual fee of .70 (.70%) of one
percent of the average daily net asset value of the Fund. The fee will be paid
monthly.
Witness XXXXXXXXX-XXXXXXXX TRUST
/s/Xxxxx X. Xxxxxxx By/s/Xxxxxxx X. Major
Secretary
Witness XXXXXXXXXX, XXXXXXX & XXXXXXXXX, INC.
/s/Xxxxx X. Xxxxxxx By/s/Xxxxx X. Xxxxxxxxx
President
Date: March 7, 1994
