AMENDED AND RESTATED
INVESTMENT ADVISORY AGREEMENT
THIS AMENDED AND RESTATED AGREEMENT made as of the 1st day of January, 2005,
by and between XXXXXXXXXXX BALANCED FUND, formerly named XXXXXXXXXXX MULTIPLE
STRATEGIES FUND (hereinafter referred to as the "Fund"), and
OPPENHEIMERFUNDS, INC. (hereinafter referred to as "OFI").
WHEREAS, the Fund is an open-end, diversified management investment company
registered as such with the Securities and Exchange Commission (the
"Commission") pursuant to the Investment Company Act of 1940 (the "Investment
Company Act"), and OFI is a registered investment adviser;
WHEREAS, the Fund and OFI have determined to amend and restate the Amended
and Restated Investment Advisory Agreement dated December 18, 1997;
NOW, THEREFORE, in consideration of the mutual promises and covenants
hereinafter set forth, it is agreed by and between the parties, as follows:
1. General Provision.
a. The Fund hereby employs OFI and OFI hereby undertakes to act as
the investment adviser of the Fund and to perform for the Fund such
other duties and functions as are hereinafter set forth. OFI shall, in
all matters, give to the Fund and its Board of Trustees the benefit of
its best judgment, effort, advice and recommendations and shall at all
times conform to, and use its best efforts to enable the Fund to
conform to: (i) the provisions of the Investment Company Act and any
rules or regulations thereunder; (ii) any other applicable provisions
of state or federal law; (iii) the provisions of the Declaration of
Trust and By-Laws of the Fund as amended from time to time; (iv)
policies and determinations of the Board of Trustees of the Fund; (v)
the fundamental policies and investment restrictions of the Fund as
reflected in the Fund's registration statement under the Investment
Company Act or as such policies may, from time to time, be amended by
the Fund's shareholders; and (vi) the Prospectus and Statement of
Additional Information of the Fund in effect from time to time. The
appropriate officers and employees of OFI shall be available upon
reasonable notice for consultation with any of the Trustees and
officers of the Fund with respect to any matters dealing with the
business and affairs of the Fund, including the valuation of any of the
Fund's portfolio securities which are either not registered for public
sale or not traded on any securities market.
b. OFI shall not be liable for any loss sustained by the Fund in
connection with any matters to which this Agreement relates, except a
loss resulting by reason of OFI's willful misfeasance, bad faith or
gross negligence in the performance of its duties; or by reason of its
reckless disregard of its obligations and duties under this Agreement.
2. Investment Management.
a. OFI shall, subject to the direction and control by the Fund's
Board of Trustees: (i) regularly provide investment advice and
recommendations to the Fund with respect to its investments, investment
policies and the purchase and sale of securities; (ii) supervise
continuously the investment program of the Fund and the composition of
its portfolio and determine what securities shall be purchased or sold
by the Fund; and (iii) arrange, subject to the provisions of paragraph
"8" hereof, for the purchase of securities and other investments for
the Fund and the sale of securities and other investments held in the
portfolio of the Fund.
b. Provided that the Fund shall not be required to pay any
compensation other than as provided by the terms of this Agreement and
subject to the provisions of paragraph "8" hereof, OFI may obtain
investment information, research or assistance from any other person,
firm or corporation to supplement, update or otherwise improve its
investment management services.
3. Acting as Adviser for Others.
Nothing in this Agreement shall prevent OFI or any officer thereof from
acting as investment adviser for any other person, firm or corporation
and shall not in any way limit or restrict OFI or any of its directors,
officers, or employees from buying, selling or trading any securities
for its or their own account or for the account of others for whom it
or they may be acting, provided that such activities will not adversely
affect or otherwise impair the performance by OFI of its duties and
obligations under this Agreement.
4. Other Duties of OFI.
OFI shall, at its own expense, provide and supervise the activities of
all administrative and clerical personnel as shall be required to
provide effective corporate administration for the Fund, including the
compilation and maintenance of such records with respect to its
operations as may reasonably be required; the preparation and filing of
such reports with respect thereto as shall be required by the
Commission; composition of periodic reports with respect to its
operations for the shareholders of the Fund; composition of proxy
materials for meetings of the Fund's shareholders and the composition
of such registration statements as may be required by federal and state
securities laws for continuous public sale of shares of the Fund. OFI
shall, at its own cost and expense, also provide the Fund with adequate
office space, facilities and equipment.
5. Allocation of Expenses.
All other costs and expenses not expressly assumed by OFI under this
Agreement, or to be paid by the General Distributor of the shares of
the Fund, shall be paid by the Fund, including, but not limited to: (i)
interest and taxes; (ii) brokerage commissions; (iii) premiums for
fidelity and other insurance coverage requisite to its operations; (iv)
the fees and expenses of its Trustees; (v) legal and audit expenses;
(vi) custodian and transfer agent fees and expenses; (vii) expenses
incident to the redemption of its shares; (viii) expenses incident to
the issuance of its shares against payment therefor by or on behalf of
the subscribers thereto; (ix) fees and expenses, other than as
hereinabove provided, incident to the registration under federal and
state securities laws of shares of the Fund for public sale; (x)
expenses of printing and mailing reports, notices and proxy materials
to shareholders of the Fund; (xi) except as noted above, all other
expenses incidental to holding meetings of the Fund's shareholders; and
(xii) such extraordinary non-recurring expenses as may arise, including
litigation, affecting the Fund and any obligation which the Fund may
have to indemnify its officers and Trustees with respect thereto. Any
officers or employees of OFI or any entity controlling, controlled by
or under common control with OFI, who may also serve as officers,
Trustees or employees of the Fund shall not receive any compensation by
the Fund for their services.
6. Compensation of OFI.
The Trust agrees to pay OFI and OFI agrees to accept as full
compensation for the performance of all functions and duties on its
part to be performed pursuant to the provisions hereof, a fee computed
on the aggregate net assets of the Fund as of the close of each
business day and payable monthly at the following annual rates:
0.75% of the first $200 million of aggregate net assets;
0.72% of the next $200 million of aggregate net assets;
0.69% of the next $200 million of aggregate net assets;
0.66% of the next $200 million of aggregate net assets;
0.60% of the next $700 million of aggregate net assets; and
0.58% of aggregate net assets in excess of $1.5 billion.
7. Use of Name "Xxxxxxxxxxx."
OFI hereby grants to the Fund a royalty-free, non-exclusive license to
use the name "Xxxxxxxxxxx" in the name of the Fund for the duration of
this Agreement and any extensions or renewals thereof. Such license
may, upon termination of this Agreement, be terminated by OFI, in which
event the Fund shall promptly take whatever action may be necessary to
change its name and discontinue any further use of the name
"Xxxxxxxxxxx" in the name of the Fund or otherwise. The name
"Xxxxxxxxxxx" may be used or licensed by OFI in connection any of its
activities or licensed by OFI to any other party.
8. Portfolio Transactions and Brokerage.
a. OFI is authorized, in arranging the Fund's portfolio
transactions, to employ or deal with such members of securities or
commodities exchanges, brokers or dealers including "affiliated"
broker-dealers (as that term is defined in the Investment Company Act)
(hereinafter "broker-dealers"), as may, in its best judgment, implement
the policy of the Fund to obtain, at reasonable expense, the "best
execution" (prompt and reliable execution at the most favorable
security price obtainable) of the Fund's portfolio transactions as
well as to obtain, consistent with the provisions of subparagraph
"(c)" of this paragraph "8," the benefit of such investment information
or research as may be of significant assistance to the performance by
OFI of its investment management functions.
b. OFI shall select broker-dealers to effect the Fund's portfolio
transactions on the basis of its estimate of their ability to obtain
best execution of particular and related portfolio transactions. The
abilities of a broker-dealer to obtain best execution of particular
portfolio transaction(s) will be judged by OFI on the basis of all
relevant factors and considerations including, insofar as feasible, the
execution capabilities required by the transaction or transactions; the
ability and willingness of the broker-dealer to facilitate the Fund's
portfolio transactions by participating therein for its own account;
the importance to the Fund of speed, efficiency or confidentiality; the
broker-dealer's apparent familiarity with sources from or to whom
particular securities might be purchased or sold; as well as any other
matters relevant to the selection of a broker-dealer for particular and
related transactions of the Fund.
c. OFI shall have discretion, in the interests of the Fund, to
allocate brokerage on the Fund's portfolio transactions to
broker-dealers, other than affiliated broker-dealers, qualified to
obtain best execution of such transactions who provide brokerage and/or
research services (as such services are defined in Section 28(e)(3) of
the Securities Exchange Act of 1934) for the Fund and/or other accounts
for which OFI and its affiliates exercise "investment discretion" (as
that term is defined in Section 3(a)(35) of the Securities Exchange Act
of 1934) and to cause the Fund to pay such broker-dealers a commission
for effecting a portfolio transaction for the Fund that is in excess of
the amount of commission another broker-dealer adequately qualified to
effect such transaction would have charged for effecting that
transaction, if OFI determines, in good faith, that such commission is
reasonable in relation to the value of the brokerage and/or research
services provided by such broker-dealer, viewed in terms of either that
particular transaction or the overall responsibilities of OFI and its
investment advisory affiliates with respect to the accounts as to which
they exercise investment discretion. In reaching such determination,
OFI will not be required to place or attempt to place a specific dollar
value on the brokerage and/or research services provided or being
provided by such broker-dealer. In demonstrating that such
determinations were made in good faith, OFI shall be prepared to show
that all commissions were allocated for purposes contemplated by this
Agreement and that the total commissions paid by the Fund over a
representative period selected by the Fund's Trustees were reasonable
in relation to the benefits to the Fund.
d. OFI shall have no duty or obligation to seek advance competitive
bidding for the most favorable commission rate applicable to any
particular portfolio transactions or to select any broker-dealer on the
basis of its purported or "posted" commission rate but will, to the
best of its ability, endeavor to be aware of the current level of the
charges of eligible broker-dealers and to minimize the expense incurred
by the Fund for effecting the Fund's portfolio transactions to the
extent consistent with the interests and policies of the Fund as
established by the determinations of the Fund's Board of Trustees and
the provisions of this paragraph "8".
e. The Fund recognizes that an affiliated broker (i) may act as one
of the Fund's regular brokers so long as it is lawful for it so to act;
(ii) may be a major recipient of brokerage commissions paid by the
Fund; and (iii) may effect portfolio transactions for the Fund only if
the commissions, fees or other remuneration received or to be received
by it are determined in accordance with procedures contemplated by any
rule, regulation or order adopted under the Investment Company Act for
determining the permissible level of such commissions.
9. Duration.
This Agreement will take effect on the date first set forth above and
will continue in effect thereafter from year to year, so long as such
continuance shall be approved at least annually in the manner
contemplated by Section 15 of the Investment Company Act.
10. Termination.
This Agreement may be terminated: (i) by OFI at any time without
penalty upon giving the Fund sixty days' written notice (which notice
may be waived by the Fund); or (ii) by the Fund at any time without
penalty upon sixty days' written notice to OFI (which notice may be
waived by OFI) provided that such termination by the Fund shall be
directed or approved by the vote of a majority of all of the Trustees
of the Fund then in office or by the vote of the holders of a
"majority" (as defined in the Investment Company Act) of the
outstanding voting securities of the Fund.
11. Assignment or Amendment.
This Agreement may not be amended or the rights of OFI hereunder sold,
transferred, pledged or otherwise in any manner encumbered without the
affirmative vote or written consent of the holders of the majority of
the outstanding voting securities of the Fund; this Agreement shall
automatically and immediately terminate in the event of its
"assignment," as defined in the Investment Company Act.
12. Disclaimer of Shareholder Liability.
OFI understands and agrees that the obligations of the Fund under this
Agreement are not binding upon any Trustee or shareholder of the Fund
personally, but bind only the Fund and its property. OFI represents
that it has notice of the provisions of the Declaration of Trust of the
Fund disclaiming shareholder liability for acts or obligations of the
Fund.
13. Definitions.
The terms and provisions of this Agreement shall be interpreted and
defined in a manner consistent with the provisions and definitions of
the Investment Company Act.
XXXXXXXXXXX BALANCED FUND
By: /s/ Xxxxxx X. Xxxx
Xxxxxx X. Xxxx
Secretary
OPPENHEIMERFUNDS, INC.
By: /s/ Xxxx X. Xxxxxx
Xxxx X. Xxxxxx
Chairman, President and Chief
Executive Officer
