EXHIBIT 99.D
INVESTMENT ADVISORY AGREEMENT
This Agreement (hereinafter the "Agreement") made this 1st day of
August, 2000 by and between Aon Funds, a Delaware business trust (hereinafter
the "Trust"), an open-ended management company registered under the Investment
Company Act of 1940, as amended (hereinafter the "1940 Act"), and Aon Advisors,
Inc., a Virginia corporation (hereinafter the "Advisor"), an investment advisor
registered under the Investment Advisers Act of 1940.
1. Furnishing of Documents.
------------------------
1.1 The Trust has furnished the Advisor with copies of each of the
following documents:
(a) Agreement and Declaration of Trust of the Trust;
(b) Bylaws of the Trust as in effect on the date hereof;
(c) The Trust's effective registration statement on Form N-lA
as filed with the Securities and Exchange Commission
("SEC"), which includes all statements of the investment
objective, policies and restrictions of the Fund of the
Trust referred to below.
1.2 The Trust will furnish the Advisor, from time to time, with copies
of all amendments of or supplements to the foregoing, if any.
1.3 The Advisor will be entitled to rely on all documents so furnished
by the Trust.
2. Investment Advisory Services.
-----------------------------
2.1 Subject to the supervision and approval of the Trust's trustees (the
"Trustees"), the Trust hereby employs the Advisor to act as the investment
advisor to, and manager of, the Trust's Money Market Fund (hereinafter the
"Fund").
2.2 The Advisor hereby agrees to manage the investment and reinvestment
of the assets of the Fund, at its own expense, in accordance with the Fund's
investment objective, policies and restrictions as stated in the documents
referred to in Section l.1(a), (b) and (c) hereof.
2.3 The Advisor agrees, for the term of this Agreement, to assume the
obligations set forth in this Agreement for the compensation provided and on the
other terms and conditions set forth in this Agreement.
2.4 The Advisor shall:
(a) provide, or obtain, and evaluate such economic, statistical
and financial data and information and undertake such
additional investment research as it shall believe necessary
or advisable;
(b) conduct a continuous program of investment and reinvestment
with respect to the Fund's assets and, with respect thereto,
the Advisor is hereby granted full authority by the Trust to
place orders for purchases,
sales, exchanges or other dispositions of securities and
other instruments for the Fund's account and to manage the
investments and any other property of the Fund, and to
provide or obtain such services as may be necessary in
managing, acquiring or disposing of investments;
(c) consult with and report to the Trustees, or any committees
or officers acting pursuant to authority of the Trustees, at
such times and in such manner as the Trustees may deem
appropriate, with respect to the implementation of the
investment objective, policies and restrictions of the Fund;
and
(d) at the Trust's request, provide persons to serve as trustees
and officers of the Trust.
3. Investment Advisory Fee.
------------------------
3.1 In consideration of all services rendered pursuant to Section 2 of
this Agreement, the Fund shall pay to the Advisor, after the end of each
calendar month, a fee, accrued daily and based upon the average daily net asset
value of the Fund for the month (or portion thereof during which this Agreement
is in effect), at an annual rate of 0.10% (10/100ths of 1%).
3.2 If on any day there is no determination of the net asset value of
the Fund as a result of a suspension of the right of redemption of Fund shares
or for any other reason, then for the purpose of this Section 3, the net asset
value of the Fund as last determined will be deemed to be the net asset value
for such day.
4. Expenses.
---------
4.1 The Advisor will bear all expenses in connection with the
performance of its services under this Agreement.
4.2 The Trust or the Fund will assume and pay, or enter into
arrangements providing for the direct payment subject to reimbursement of, all
other expenses incurred in the operation of the Fund or the Trust that are
incurred by or allocated to the Fund, including:
(a) taxes and fees payable by the Fund or the Trust to federal,
state or other government agencies;
(b) brokerage fees and commissions, and issue and transfer
taxes;
(c) interest;
(d) Trustees' annual retainer and meeting attendance fees and
expenses of Trustees who are not directors, officers or
employees of the Advisor or of any affiliated person, other
than a registered investment company, of the Advisor;
(e) registration, qualification, filing and other fees in
connection with securities registration requirements of
federal and state regulatory authorities;
2
(f) the charges and expenses for custodial, paying agent,
transfer agent, administration, dividend agent and
accounting agent services,
(g) outside legal fees and expenses in connection with the
affairs of the Trust, including, but not limited to,
registering and qualifying its shares with federal and state
regulatory authorities;
(h) charges and expenses of outside auditors;
(i) costs of meetings of shareholders and Trustees of the Trust;
(j) costs of maintenance of the Trust's existence as a Delaware
business trust;
(k) insurance premiums;
(l) investment advisory fees;
(m) costs and fees associated with printing and delivering
registration statements, shareholders' reports and proxy
statements;
(n) costs and fees associated with delivering reports to and
making filings with the SEC and state Blue Sky authorities;
(o) costs relating to administration of the Trust's general
operations;
(p) costs relating to the Trust's own employees, if any; and
(q) costs of preparing, printing and delivering the Trust's
prospectuses and statements of additional information to
existing shareholders of the Fund.
5. Reimbursement.
--------------
5.1 If in any fiscal year, the aggregate expense of the Fund, including
fees pursuant to this Agreement, but excluding interest, taxes, brokerage
commissions and extraordinary expenses, exceeds 1% of the value of the Fund's
average daily net assets, the Advisor will reimburse the Fund for such excess.
This expense reimbursement obligation is not limited to the amount of the fees
received hereunder and will be estimated, reconciled and paid on a monthly
basis.
6. Fund Transactions and Brokerage.
--------------------------------
6.1 The Fund's transactions in portfolio securities shall usually be
effected with the issuer or with a dealer in money market instruments acting as
principal on a net basis. The Fund also may purchase underwritten issues, which
involve an underwriting discount or commission. Decisions with respect to the
purchase and sale of portfolio securities, including allocation of portfolio
business and the negotiation of the price of the securities and commissions, if
any, are to be made by the Advisor.
6.2 Neither the Advisor nor any company affiliated with it shall act as
a broker or dealer for the purpose of executing portfolio transactions for the
Fund.
3
6.3 The primary consideration in allocating transactions to dealers and
brokers shall be prompt and effective execution of orders at the most favorable
security prices obtainable ("best execution"). Consideration also may be given
to additional factors, such as furnishing of supplemental research and other
services deemed to be of value to the Trust, the Fund or the Advisor. The
Advisor is authorized to execute orders with dealers or brokers that provide
research and security and economic analysis that supplements the research and
analysis of the Advisor, even though the spread or commission at which an order
is executed may be higher than that which another dealer or broker might charge,
provided that the Advisor determines in good faith that the amount of the spread
or commission is reasonable in relation to the value of the services provided.
Such research and services include advice as to the value of securities, the
advisability of investment in, purchasing or selling securities, and the
availability of securities or purchasers or sellers of securities; furnishing
analyses and reports concerning issuers, industries, securities, economic
factors and trends, portfolio strategy and performance of accounts; and
effecting securities transactions and performing functions incidental thereto
(such as clearance and settlement). The research may be useful to the Advisor in
serving other portfolios of the Trust, the Fund and other accounts managed by
the Advisor.
7. Similar Activities for Others.
------------------------------
7.1 The services of the Advisor to the Fund under this Agreement are not
to be deemed exclusive and the Advisor will be free to render similar services
to others so long as its services under this Agreement are not impaired.
Investment decisions for the Fund will be made independently from those of other
accounts that may be managed by the Advisor. If, however, accounts managed by
the Advisor are simultaneously engaged in purchases of the same securities,
then, pursuant to the authorization of the Trustees, available securities may be
allocated to each account and may be averaged as to price in whatever manner the
Advisor deems to be fair.
7.2 The parties to this Agreement understand that this system might
adversely affect the price paid by the Fund, or limit the size of the position
obtainable for the Fund. To the extent that transactions on behalf of more than
one client of the Advisor during the same period may increase the demand for
securities being purchased or the supply of securities being sold, the Trust and
the Fund recognize that there may be an adverse effect on price.
8. Rule 2a-7 Compliance and Maintenance of Records.
------------------------------------------------
8.1 The Advisor agrees to manage the investment and reinvestment of the
Fund's assets in compliance with Rule 2a-7, as it may from time to time be
amended, under the 1940 Act, and to maintain all records required by Rule 2a-7.
The Advisor also agrees to maintain and preserve, in accordance with the 1940
Act and rules thereunder, and for the periods prescribed by Rule 3la-2 under the
1940 Act, books and records with respect to the Fund's securities transactions
required to be maintained by Rule 3la-1 under the 1940 Act.
8.2 The Advisor further agrees that all records which it maintains for
the Fund are the Trust's property and that the Advisor will surrender them to
the Trust, its independent auditors, the Trustees, or as may be required by any
government agency having jurisdiction over the Trust, promptly upon written
request. The provisions of this Section 8 shall survive any termination of this
Agreement.
4
9. Dual Interests.
---------------
9.1 It is understood by both parties that any of the shareholders,
trustees, officers, employees and agents of the Trust may be a director,
officer, employee or agent of, or be otherwise interested in, the Advisor, any
affiliated person of the Advisor, or any organization in which the Advisor or
any affiliated person of the Advisor may have an interest; and that the Advisor,
and any such affiliated person or any such organization may have an interest in
the Trust or the Fund.
9.2 It is also understood by both parties that the existence of any such
dual interest shall not affect the validity of any transactions hereunder,
except as otherwise provided by specific provisions of applicable law, including
the 1940 Act.
10. Duration, Termination and Amendment of this Agreement.
-----------------------------------------------------
10.1 This Agreement shall not become effective, and the Advisor shall
not serve or act as the Fund's investment advisor, unless and until this
Agreement is approved by the Trust's board of trustees (the "Board"), including
a majority of the Trustees who are not parties to this Agreement or interested
persons of any such party to this Agreement, cast in person at a meeting called
for the purpose of voting on such approval, and by a vote of a majority of the
outstanding voting securities of the Fund.
10.2 If approved as provided above, this Agreement shall continue in
effect for two years and from year to year thereafter, but only so long as such
continuance is specifically approved at least annually either:
(a) by the Board; or
(b) by a vote of a majority of the outstanding voting securities
of the Fund.
In either event such continuance also must be approved by the vote of a majority
of the Trustees who are not parties to this Agreement or interested persons of
the Trust or of the Advisor, cast in person at a meeting called for the purpose
of voting on such approval.
10.3 This Agreement may, on sixty days' written notice, be terminated at
any time, without the payment of any penalty, by the Board, by a vote of a
majority of the Fund's outstanding voting securities of the Fund or by the
Advisor.
10.4 This Agreement shall automatically terminate in the event of its
assignment.
10.5 In interpreting the provisions of this Section 10, the definitions
contained in Section 2(a) of the 1940 Act, particularly the definitions of
"interested person" and "assignment" and a "majority of the outstanding voting
securities," shall be applied.
10.6 This Agreement shall not be amended without specific approval of
such amendment by:
(a) the vote of a majority of the outstanding voting securities
of the Fund; and
(b) the vote of a majority of the Trustees, including a majority
of the Trustees who are not parties to this Agreement and
who are not interested persons
5
of the Trust or of the Advisor, cast in person at a meeting
called for the purpose of voting on such amendment.
11. Liability of the Advisor.
-------------------------
11.1 In the absence of willful misfeasance, bad faith, gross negligence
or reckless disregard of obligations or duties on the part of the Advisor, or of
its officers, directors, agents, employees, controlling persons, shareholders,
or any other person or entity affiliated with the Advisor or retained by it to
perform or assist in the performance of its obligations under this Agreement
(each of the foregoing, an "Advisory Affiliate"), neither the Advisor nor any
Advisory Affiliate shall be subject to liability to the Trust or the Fund or to
any shareholder of the Fund or to any other person with a beneficial interest in
the Fund or the Trust for any act or omission in the course of, or connected
with, rendering services hereunder, including without limitation any error of
judgment or mistake of law or for any loss suffered by the Trust or the Fund or
any shareholder or other person in connection with the matters to which this
Agreement relates, except to the extent specified in Section 36(b) of the 1940
Act concerning loss resulting from a breach of fiduciary duty with respect to
the receipt of compensation for services.
12. Use of Name "Aon" Marks or Symbols.
----------------------------------
12.1 If the Advisor ceases to act as the investment advisor, or, in any
event, if the Advisor so requests in writing, the Trust agrees it will take all
necessary action to change the name of the Trust and/or the Fund to a name not
including the word "Aon."
13. Miscellaneous.
--------------
13.1 The Advisor may from time to time employ or associate with any
person or persons it may believe to be particularly fitted to assist it in the
performance of this Agreement. The compensation of any such persons will be paid
by the Advisor, and no obligation will be incurred by, or on behalf of, the
Trust with respect to them. In addition, the Trust understands that the persons
employed by the Advisor to assist in the performance of its duties hereunder
will not devote their full time to those duties, and that nothing contained
herein will be deemed to limit or restrict the Advisor's right or the right of
any of the Advisor's affiliates to engage in and devote time and attention to
other businesses or to render other services of whatever kind or nature.
13.2 The captions 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.
13.3 This Agreement may be executed simultaneously in two or more
counterparts, each of which will be deemed an original, but all of which
together will constitute one and same instrument.
13.4 It is intended by the parties that this Agreement be governed by
the law of the State of Illinois; however, this Agreement is also governed by,
and subject to, the 1940 Act, and rules thereunder, including such exemptions
therefrom as the SEC may grant.
6
IN WITNESS WHEREOF, the parties hereto have caused this agreement to be
executed by their respective officers thereunto duly authorized.
Attest: Aon Funds
/s/ Xxxxxxxxx X. Xxxxxx /s/ Xxxxxxx X. Xxxxxx
------------------------------------ -----------------------
Secretary President
Attest: Aon Advisors, Inc.
/s/ Xxxxxxxxx Xxxxxx /s/ Xxxxxxx X. Xxxxxx
------------------------------------ -----------------------
Secretary President
Signature Page for Investment Advisory Agreement
Money Market Fund
INVESTMENT ADVISORY AGREEMENT
This Agreement (hereinafter the "Agreement") made this 1st day of
August, 2000 by and between Aon Funds, a Delaware business trust (hereinafter
the "Trust"), an open-ended management company registered under the Investment
Company Act of 1940, as amended (hereinafter the "1940 Act"), and Aon Advisors,
Inc., a Virginia corporation (hereinafter the "Advisor"), an investment advisor
registered under the Investment Advisers Act of 1940.
1. Furnishing of Documents.
------------------------
1.1 The Trust has furnished the Advisor with copies of each of the
following documents:
(a) Agreement and Declaration of Trust of the Trust;
(b) Bylaws of the Trust as in effect on the date hereof;
(c) The Trust's effective registration statement on Form N-lA as
filed with the Securities and Exchange Commission ("SEC"),
which includes all statements of the investment objective,
policies and restrictions of the Fund of the Trust referred
to below.
1.2 The Trust will furnish the Advisor, from time to time, with copies
of all amendments of or supplements to the foregoing, if any.
1.3 The Advisor will be entitled to rely on all documents so furnished
by the Trust.
2. Investment Advisory Services.
-----------------------------
2.1 Subject to the supervision and approval of the Trust's trustees (the
"Trustees"), the Trust hereby employs the Advisor to act as the investment
advisor to, and manager of, the Trust's Government Securities Fund (hereinafter
the "Fund").
2.2 The Advisor hereby agrees to manage the investment and reinvestment
of the assets of the Fund, at its own expense, in accordance with the Fund's
investment objective, policies and restrictions as stated in the documents
referred to in Section l.1(a), (b) and (c) hereof.
2.3 The Advisor agrees, for the term of this Agreement, to assume the
obligations set forth in this Agreement for the compensation provided and on the
other terms and conditions set forth in this Agreement.
2.4 The Advisor shall:
(a) provide, or obtain, and evaluate such economic, statistical
and financial data and information and undertake such
additional investment research as it shall believe necessary
or advisable;
(b) conduct a continuous program of investment and reinvestment
with respect to the Fund's assets and, with respect thereto,
the Advisor is hereby granted full authority by the Trust to
place orders for purchases,
sales, exchanges or other dispositions of securities and
other instruments for the Fund's account and to manage the
investments and any other property of the Fund, and to
provide or obtain such services as may be necessary in
managing, acquiring or disposing of investments;
(c) consult with and report to the Trustees, or any committees
or officers acting pursuant to authority of the Trustees, at
such times and in such manner as the Trustees may deem
appropriate, with respect to the implementation of the
investment objective, policies and restrictions of the Fund;
and
(d) at the Trust's request, provide persons to serve as trustees
and officers of the Trust.
3. Investment Advisory Fee.
------------------------
3.1 In consideration of all services rendered pursuant to Section 2 of
this Agreement, the Fund shall pay to the Advisor, after the end of each
calendar month, a fee, accrued daily and based upon the average daily net asset
value of the Fund for the month (or portion thereof during which this Agreement
is in effect), at an annual rate of 0.10% (10/100ths of 1%).
3.2 If on any day there is no determination of the net asset value of
the Fund as a result of a suspension of the right of redemption of Fund shares
or for any other reason, then for the purpose of this Section 3, the net asset
value of the Fund as last determined will be deemed to be the net asset value
for such day.
4. Expenses.
---------
4.1 The Advisor will bear all expenses in connection with the
performance of its services under this Agreement.
4.2 The Trust or the Fund will assume and pay, or enter into
arrangements providing for the direct payment subject to reimbursement of, all
other expenses incurred in the operation of the Fund or the Trust that are
incurred by or allocated to the Fund, including:
(a) taxes and fees payable by the Fund or the Trust to federal,
state or other government agencies;
(b) brokerage fees and commissions, and issue and transfer
taxes;
(c) interest;
(d) Trustees' annual retainer and meeting attendance fees and
expenses of Trustees who are not directors, officers or
employees of the Advisor or of any affiliated person, other
than a registered investment company, of the Advisor;
(e) registration, qualification, filing and other fees in
connection with securities registration requirements of
federal and state regulatory authorities;
2
(f) the charges and expenses for custodial, paying agent,
transfer agent, administration, dividend agent and
accounting agent services,
(g) outside legal fees and expenses in connection with the
affairs of the Trust, including, but not limited to,
registering and qualifying its shares with federal and state
regulatory authorities;
(h) charges and expenses of outside auditors;
(i) costs of meetings of shareholders and Trustees of the Trust;
(j) costs of maintenance of the Trust's existence as a Delaware
business trust;
(k) insurance premiums;
(l) investment advisory fees;
(m) costs and fees associated with printing and delivering
registration statements, shareholders' reports and proxy
statements;
(n) costs and fees associated with delivering reports to and
making filings with the SEC and state Blue Sky authorities;
(o) costs relating to administration of the Trust's general
operations;
(p) costs relating to the Trust's own employees, if any; and
(q) costs of preparing, printing and delivering the Trust's
prospectuses and statements of additional information to
existing shareholders of the Fund.
5. Reimbursement.
--------------
5.1 If in any fiscal year, the aggregate expense of the Fund, including
fees pursuant to this Agreement, but excluding interest, taxes, brokerage
commissions and extraordinary expenses, exceeds 1.50% of the first $30 million
of the average daily net assets of the Fund and 1.25% of the amount by which the
average daily net assets of the Fund exceeds $30 million, the Advisor will
reimburse the Fund for such excess. This expense reimbursement obligation is not
limited to the amount of the fees received hereunder and will be estimated,
reconciled and paid on a monthly basis.
6. Fund Transactions and Brokerage.
--------------------------------
6.1 The Fund's transactions in equity securities will usually be
executed through brokers that will receive a commission paid by the Fund. The
Fund's transactions in fixed income and money market securities shall usually be
effected with the issuer or with a dealer in such instruments acting as
principal on a net basis. The Fund also may purchase underwritten issues, which
involve an underwriting discount or commission. Decisions with respect to the
purchase and sale of portfolio securities, including allocation of portfolio
business and the negotiation of the price of the securities and commissions, if
any, are to be made by the Advisor.
3
6.2 Neither the Advisor nor any company affiliated with it shall act as
a broker or dealer for the purpose of executing portfolio transactions for the
Fund.
6.3 The primary consideration in allocating transactions to dealers and
brokers shall be prompt and effective execution of orders at the most favorable
security prices obtainable ("best execution"). Consideration also may be given
to additional factors, such as furnishing of supplemental research and other
services deemed to be of value to the Trust, the Fund or the Advisor. The
Advisor is authorized to execute orders with dealers or brokers that provide
research and security and economic analysis that supplements the research and
analysis of the Advisor, even though the spread or commission at which an order
is executed may be higher than that which another dealer or broker might charge,
provided that the Advisor determines in good faith that the amount of the spread
or commission is reasonable in relation to the value of the services provided.
Such research and services include advice as to the value of securities, the
advisability of investment in, purchasing or selling securities, and the
availability of securities or purchasers or sellers of securities; furnishing
analyses and reports concerning issuers, industries, securities, economic
factors and trends, portfolio strategy and performance of accounts; and
effecting securities transactions and performing functions incidental thereto
(such as clearance and settlement). The research may be useful to the Advisor in
serving other portfolios of the Trust, the Fund and other accounts managed by
the Advisor.
7. Similar Activities for Others.
------------------------------
7.1 The services of the Advisor to the Fund under this Agreement are not
to be deemed exclusive and the Advisor will be free to render similar services
to others so long as its services under this Agreement are not impaired.
Investment decisions for the Fund will be made independently from those of other
accounts that may be managed by the Advisor. If, however, accounts managed by
the Advisor are simultaneously engaged in purchases of the same securities,
then, pursuant to the authorization of the Trustees, available securities may be
allocated to each account and may be averaged as to price in whatever manner the
Advisor deems to be fair.
7.2 The parties to this Agreement understand that this system might
adversely affect the price paid by the Fund, or limit the size of the position
obtainable for the Fund. To the extent that transactions on behalf of more than
one client of the Advisor during the same period may increase the demand for
securities being purchased or the supply of securities being sold, the Trust and
the Fund recognize that there may be an adverse effect on price.
8. Compliance and Maintenance of Records.
--------------------------------------
8.1 The Advisor agrees to manage the investment and reinvestment of the
Fund's assets in compliance with the 1940 Act and rules and regulations
thereunder. The Advisor also agrees to maintain and preserve, in accordance with
the 1940 Act and rules thereunder, and for the periods prescribed by Rule 3la-2
under the 1940 Act, books and records with respect to the Fund's securities
transactions required to be maintained by Rule 3la-1 under the 1940 Act.
8.2 The Advisor further agrees that all records which it maintains for
the Fund are the Trust's property and that the Advisor will surrender them to
the Trust, its independent auditors, the Trustees, or as may be required by any
government agency having jurisdiction over the Trust, promptly upon written
request. The provisions of this Section 8 shall survive any termination of this
Agreement.
4
9. Dual Interests.
---------------
9.1 It is understood by both parties that any of the shareholders,
trustees, officers, employees and agents of the Trust may be a director,
officer, employee or agent of, or be otherwise interested in, the Advisor, any
affiliated person of the Advisor, or any organization in which the Advisor or
any affiliated person of the Advisor may have an interest; and that the Advisor,
and any such affiliated person or any such organization may have an interest in
the Trust or the Fund.
9.2 It is also understood by both parties that the existence of any such
dual interest shall not affect the validity of any transactions hereunder,
except as otherwise provided by specific provisions of applicable law, including
the 1940 Act.
10. Duration, Termination and Amendment of this Agreement.
-----------------------------------------------------
10.1 This Agreement shall not become effective, and the Advisor shall
not serve or act as the Fund's investment advisor, unless and until this
Agreement is approved by the Trust's board of trustees (the "Board"), including
a majority of the Trustees who are not parties to this Agreement or interested
persons of any such party to this Agreement, cast in person at a meeting called
for the purpose of voting on such approval, and by a vote of a majority of the
outstanding voting securities of the Fund.
10.2 If approved as provided above, this Agreement shall continue in
effect for two years and from year to year thereafter, but only so long as such
continuance is specifically approved at least annually either:
(a) by the Board; or
(b) by a vote of a majority of the outstanding voting securities
of the Fund.
In either event such continuance also must be approved by the vote of a majority
of the Trustees who are not parties to this Agreement or interested persons of
the Trust or of the Advisor, cast in person at a meeting called for the purpose
of voting on such approval.
10.3 This Agreement may, on sixty days' written notice, be terminated at
any time, without the payment of any penalty, by the Board, by a vote of a
majority of the Fund's outstanding voting securities of the Fund or by the
Advisor.
10.4 This Agreement shall automatically terminate in the event of its
assignment.
10.5 In interpreting the provisions of this Section 10, the definitions
contained in Section 2(a) of the 1940 Act, particularly the definitions of
"interested person" and "assignment" and a "majority of the outstanding voting
securities," shall be applied.
10.6 This Agreement shall not be amended without specific approval of
such amendment by:
(a) the vote of a majority of the outstanding voting securities
of the Fund; and
(b) the vote of a majority of the Trustees, including a majority
of the Trustees who are not parties to this Agreement and
who are not interested persons
5
of the Trust or of the Advisor, cast in person at a meeting
called for the purpose of voting on such amendment.
11. Liability of the Advisor.
-------------------------
11.1 In the absence of willful misfeasance, bad faith, gross negligence
or reckless disregard of obligations or duties on the part of the Advisor, or of
its officers, directors, agents, employees, controlling persons, shareholders,
or any other person or entity affiliated with the Advisor or retained by it to
perform or assist in the performance of its obligations under this Agreement
(each of the foregoing, an "Advisory Affiliate"), neither the Advisor nor any
Advisory Affiliate shall be subject to liability to the Trust or the Fund or to
any shareholder of the Fund or to any other person with a beneficial interest in
the Fund or the Trust for any act or omission in the course of, or connected
with, rendering services hereunder, including without limitation any error of
judgment or mistake of law or for any loss suffered by the Trust or the Fund or
any shareholder or other person in connection with the matters to which this
Agreement relates, except to the extent specified in Section 36(b) of the 1940
Act concerning loss resulting from a breach of fiduciary duty with respect to
the receipt of compensation for services.
12. Use of Name "Aon" Marks or Symbols.
----------------------------------
12.1 If the Advisor ceases to act as the investment advisor, or, in any
event, if the Advisor so requests in writing, the Trust agrees it will take all
necessary action to change the name of the Trust and/or the Fund to a name not
including the word "Aon."
13. Miscellaneous.
--------------
13.1 The Advisor may from time to time employ or associate with any
person or persons it may believe to be particularly fitted to assist it in the
performance of this Agreement. The compensation of any such persons will be paid
by the Advisor, and no obligation will be incurred by, or on behalf of, the
Trust with respect to them. In addition, the Trust understands that the persons
employed by the Advisor to assist in the performance of its duties hereunder
will not devote their full time to those duties, and that nothing contained
herein will be deemed to limit or restrict the Advisor's right or the right of
any of the Advisor's affiliates to engage in and devote time and attention to
other businesses or to render other services of whatever kind or nature.
13.2 The captions 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.
13.3 This Agreement may be executed simultaneously in two or more
counterparts, each of which will be deemed an original, but all of which
together will constitute one and same instrument.
13.4 It is intended by the parties that this Agreement be governed by
the law of the State of Illinois; however, this Agreement is also governed by,
and subject to, the 1940 Act, and rules thereunder, including such exemptions
therefrom as the SEC may grant.
6
IN WITNESS WHEREOF, the parties hereto have caused this agreement to be
executed by their respective officers thereunto duly authorized.
Attest: Aon Funds
/s/ Xxxxxxxxx X. Xxxxxx /s/ Xxxxxxx X. Xxxxxx
------------------------------------ -----------------------
Secretary President
Attest: Aon Advisors, Inc.
/s/ Xxxxxxxxx X. Xxxxxx /s/ Xxxxxxx X. Xxxxxx
------------------------------------ -----------------------
Secretary President
Signature Page for Investment Advisory Agreement
Government Securities Fund
INVESTMENT ADVISORY AGREEMENT
This Agreement (hereinafter the "Agreement") made this 1st day of
August, 2000 by and between Aon Funds, a Delaware business trust (hereinafter
the "Trust"), an open-ended management company registered under the Investment
Company Act of 1940, as amended (hereinafter the "1940 Act"), and Aon Advisors,
Inc., a Virginia corporation (hereinafter the "Advisor"), an investment advisor
registered under the Investment Advisers Act of 1940.
1. Furnishing of Documents.
------------------------
1.1 The Trust has furnished the Advisor with copies of each of the
following documents:
(a) Agreement and Declaration of Trust of the Trust;
(b) Bylaws of the Trust as in effect on the date hereof;
(c) The Trust's effective registration statement on Form N-lA as
filed with the Securities and Exchange Commission ("SEC"),
which includes all statements of the investment objective,
policies and restrictions of the Fund of the Trust referred
to below.
1.2 The Trust will furnish the Advisor, from time to time, with copies
of all amendments of or supplements to the foregoing, if any.
1.3 The Advisor will be entitled to rely on all documents so furnished
by the Trust.
2. Investment Advisory Services.
-----------------------------
2.1 Subject to the supervision and approval of the Trust's trustees (the
"Trustees"), the Trust hereby employs the Advisor to act as the investment
advisor to, and manager of, the Trust's Asset Allocation Fund (hereinafter the
"Fund").
2.2 The Advisor hereby agrees to manage the investment and reinvestment
of the assets of the Fund, at its own expense, in accordance with the Fund's
investment objective, policies and restrictions as stated in the documents
referred to in Section l.1(a), (b) and (c) hereof.
2.3 The Advisor agrees, for the term of this Agreement, to assume the
obligations set forth in this Agreement for the compensation provided and on the
other terms and conditions set forth in this Agreement.
2.4 The Advisor shall:
(a) provide, or obtain, and evaluate such economic, statistical
and financial data and information and undertake such
additional investment research as it shall believe necessary
or advisable;
(b) conduct a continuous program of investment and reinvestment
with respect to the Fund's assets and, with respect thereto,
the Advisor is hereby granted full authority by the Trust to
place orders for purchases,
sales, exchanges or other dispositions of securities and
other instruments for the Fund's account and to manage the
investments and any other property of the Fund, and to
provide or obtain such services as may be necessary in
managing, acquiring or disposing of investments;
(c) consult with and report to the Trustees, or any committees
or officers acting pursuant to authority of the Trustees, at
such times and in such manner as the Trustees may deem
appropriate, with respect to the implementation of the
investment objective, policies and restrictions of the Fund;
and
(d) at the Trust's request, provide persons to serve as trustees
and officers of the Trust.
3. Investment Advisory Fee.
------------------------
3.1 In consideration of all services rendered pursuant to Section 2 of
this Agreement, the Fund shall pay to the Advisor, after the end of each
calendar month, a fee, accrued daily and based upon the average daily net asset
value of the Fund for the month (or portion thereof during which this Agreement
is in effect), at an annual rate of 0.25% (25/100ths of 1%).
3.2 If on any day there is no determination of the net asset value of
the Fund as a result of a suspension of the right of redemption of Fund shares
or for any other reason, then for the purpose of this Section 3, the net asset
value of the Fund as last determined will be deemed to be the net asset value
for such day.
4. Expenses.
---------
4.1 The Advisor will bear all expenses in connection with the
performance of its services under this Agreement.
4.2 The Trust or the Fund will assume and pay, or enter into
arrangements providing for the direct payment subject to reimbursement of, all
other expenses incurred in the operation of the Fund or the Trust that are
incurred by or allocated to the Fund, including:
(a) taxes and fees payable by the Fund or the Trust to federal,
state or other government agencies;
(b) brokerage fees and commissions, and issue and transfer
taxes;
(c) interest;
(d) Trustees' annual retainer and meeting attendance fees and
expenses of Trustees who are not directors, officers or
employees of the Advisor or of any affiliated person, other
than a registered investment company, of the Advisor;
(e) registration, qualification, filing and other fees in
connection with securities registration requirements of
federal and state regulatory authorities;
2
(f) the charges and expenses for custodial, paying agent,
transfer agent, administration, dividend agent and
accounting agent services,
(g) outside legal fees and expenses in connection with the
affairs of the Trust, including, but not limited to,
registering and qualifying its shares with federal and state
regulatory authorities;
(h) charges and expenses of outside auditors;
(i) costs of meetings of shareholders and Trustees of the Trust;
(j) costs of maintenance of the Trust's existence as a Delaware
business trust;
(k) insurance premiums;
(l) investment advisory fees;
(m) costs and fees associated with printing and delivering
registration statements, shareholders' reports and proxy
statements;
(n) costs and fees associated with delivering reports to and
making filings with the SEC and state Blue Sky authorities;
(o) costs relating to administration of the Trust's general
operations;
(p) costs relating to the Trust's own employees, if any; and
(q) costs of preparing, printing and delivering the Trust's
prospectuses and statements of additional information to
existing shareholders of the Fund.
5. Reimbursement.
--------------
5.1 If in any fiscal year, the aggregate expense of the Fund, including
fees pursuant to this Agreement, but excluding interest, taxes, brokerage
commissions and extraordinary expenses, exceeds 1.25% of the average daily net
assets of the Fund, the Advisor will reimburse the Fund for such excess. This
expense reimbursement obligation is not limited to the amount of the fees
received hereunder and will be estimated, reconciled and paid on a monthly
basis.
6. Fund Transactions and Brokerage.
--------------------------------
6.1 The Fund's transactions in equity securities will usually be
executed through brokers that will receive a commission paid by the Fund. The
Fund's transactions in fixed income and money market securities shall usually be
effected with the issuer or with a dealer in such instruments acting as
principal on a net basis. The Fund also may purchase underwritten issues, which
involve an underwriting discount or commission. Decisions with respect to the
purchase and sale of portfolio securities, including allocation of portfolio
business and the negotiation of the price of the securities and commissions, if
any, are to be made by the Advisor.
6.2 Neither the Advisor nor any company affiliated with it shall act as
a broker or dealer for the purpose of executing portfolio transactions for the
Fund.
3
6.3 The primary consideration in allocating transactions to dealers and
brokers shall be prompt and effective execution of orders at the most favorable
security prices obtainable ("best execution"). Consideration also may be given
to additional factors, such as furnishing of supplemental research and other
services deemed to be of value to the Trust, the Fund or the Advisor. The
Advisor is authorized to execute orders with dealers or brokers that provide
research and security and economic analysis that supplements the research and
analysis of the Advisor, even though the spread or commission at which an order
is executed may be higher than that which another dealer or broker might charge,
provided that the Advisor determines in good faith that the amount of the spread
or commission is reasonable in relation to the value of the services provided.
Such research and services include advice as to the value of securities, the
advisability of investment in, purchasing or selling securities, and the
availability of securities or purchasers or sellers of securities; furnishing
analyses and reports concerning issuers, industries, securities, economic
factors and trends, portfolio strategy and performance of accounts; and
effecting securities transactions and performing functions incidental thereto
(such as clearance and settlement). The research may be useful to the Advisor in
serving other portfolios of the Trust, the Fund and other accounts managed by
the Advisor.
7. Similar Activities for Others.
------------------------------
7.1 The services of the Advisor to the Fund under this Agreement are not
to be deemed exclusive and the Advisor will be free to render similar services
to others so long as its services under this Agreement are not impaired.
Investment decisions for the Fund will be made independently from those of other
accounts that may be managed by the Advisor. If, however, accounts managed by
the Advisor are simultaneously engaged in purchases of the same securities,
then, pursuant to the authorization of the Trustees, available securities may be
allocated to each account and may be averaged as to price in whatever manner the
Advisor deems to be fair.
7.2 The parties to this Agreement understand that this system might
adversely affect the price paid by the Fund, or limit the size of the position
obtainable for the Fund. To the extent that transactions on behalf of more than
one client of the Advisor during the same period may increase the demand for
securities being purchased or the supply of securities being sold, the Trust and
the Fund recognize that there may be an adverse effect on price.
8. Compliance and Maintenance of Records.
--------------------------------------
8.1 The Advisor agrees to manage the investment and reinvestment of the
Fund's assets in compliance with the 1940 Act and rules and regulations
thereunder. The Advisor also agrees to maintain and preserve, in accordance with
the 1940 Act and rules thereunder, and for the periods prescribed by Rule 3la-2
under the 1940 Act, books and records with respect to the Fund's securities
transactions required to be maintained by Rule 3la-1 under the 1940 Act.
8.2 The Advisor further agrees that all records which it maintains for
the Fund are the Trust's property and that the Advisor will surrender them to
the Trust, its independent auditors, the Trustees, or as may be required by any
government agency having jurisdiction over the Trust, promptly upon written
request. The provisions of this Section 8 shall survive any termination of this
Agreement.
4
9. Dual Interests.
---------------
9.1 It is understood by both parties that any of the shareholders,
trustees, officers, employees and agents of the Trust may be a director,
officer, employee or agent of, or be otherwise interested in, the Advisor, any
affiliated person of the Advisor, or any organization in which the Advisor or
any affiliated person of the Advisor may have an interest; and that the Advisor,
and any such affiliated person or any such organization may have an interest in
the Trust or the Fund.
9.2 It is also understood by both parties that the existence of any such
dual interest shall not affect the validity of any transactions hereunder,
except as otherwise provided by specific provisions of applicable law, including
the 1940 Act.
10. Duration, Termination and Amendment of this Agreement.
-----------------------------------------------------
10.1 This Agreement shall not become effective, and the Advisor shall
not serve or act as the Fund's investment advisor, unless and until this
Agreement is approved by the Trust's board of trustees (the "Board"), including
a majority of the Trustees who are not parties to this Agreement or interested
persons of any such party to this Agreement, cast in person at a meeting called
for the purpose of voting on such approval, and by a vote of a majority of the
outstanding voting securities of the Fund.
10.2 If approved as provided above, this Agreement shall continue in
effect for two years and from year to year thereafter, but only so long as such
continuance is specifically approved at least annually either:
(a) by the Board; or
(b) by a vote of a majority of the outstanding voting securities
of the Fund.
In either event such continuance also must be approved by the vote of a majority
of the Trustees who are not parties to this Agreement or interested persons of
the Trust or of the Advisor, cast in person at a meeting called for the purpose
of voting on such approval.
10.3 This Agreement may, on sixty days' written notice, be terminated at
any time, without the payment of any penalty, by the Board, by a vote of a
majority of the Fund's outstanding voting securities of the Fund or by the
Advisor.
10.4 This Agreement shall automatically terminate in the event of its
assignment.
10.5 In interpreting the provisions of this Section 10, the definitions
contained in Section 2(a) of the 1940 Act, particularly the definitions of
"interested person" and "assignment" and a "majority of the outstanding voting
securities," shall be applied.
10.6 This Agreement shall not be amended without specific approval of
such amendment by:
(a) the vote of a majority of the outstanding voting securities
of the Fund; and
(b) the vote of a majority of the Trustees, including a majority
of the Trustees who are not parties to this Agreement and
who are not interested persons
5
of the Trust or of the Advisor, cast in person at a meeting
called for the purpose of voting on such amendment.
11. Liability of the Advisor.
-------------------------
11.1 In the absence of willful misfeasance, bad faith, gross negligence
or reckless disregard of obligations or duties on the part of the Advisor, or of
its officers, directors, agents, employees, controlling persons, shareholders,
or any other person or entity affiliated with the Advisor or retained by it to
perform or assist in the performance of its obligations under this Agreement
(each of the foregoing, an "Advisory Affiliate"), neither the Advisor nor any
Advisory Affiliate shall be subject to liability to the Trust or the Fund or to
any shareholder of the Fund or to any other person with a beneficial interest in
the Fund or the Trust for any act or omission in the course of, or connected
with, rendering services hereunder, including without limitation any error of
judgment or mistake of law or for any loss suffered by the Trust or the Fund or
any shareholder or other person in connection with the matters to which this
Agreement relates, except to the extent specified in Section 36(b) of the 1940
Act concerning loss resulting from a breach of fiduciary duty with respect to
the receipt of compensation for services.
12. Use of Name "Aon" Marks or Symbols.
----------------------------------
12.1 If the Advisor ceases to act as the investment advisor, or, in any
event, if the Advisor so requests in writing, the Trust agrees it will take all
necessary action to change the name of the Trust and/or the Fund to a name not
including the word "Aon."
13. Miscellaneous.
--------------
13.1 The Advisor may from time to time employ or associate with any
person or persons it may believe to be particularly fitted to assist it in the
performance of this Agreement. The compensation of any such persons will be paid
by the Advisor, and no obligation will be incurred by, or on behalf of, the
Trust with respect to them. In addition, the Trust understands that the persons
employed by the Advisor to assist in the performance of its duties hereunder
will not devote their full time to those duties, and that nothing contained
herein will be deemed to limit or restrict the Advisor's right or the right of
any of the Advisor's affiliates to engage in and devote time and attention to
other businesses or to render other services of whatever kind or nature.
13.2 The captions 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.
13.3 This Agreement may be executed simultaneously in two or more
counterparts, each of which will be deemed an original, but all of which
together will constitute one and same instrument.
13.4 It is intended by the parties that this Agreement be governed by
the law of the State of Illinois; however, this Agreement is also governed by,
and subject to, the 1940 Act, and rules thereunder, including such exemptions
therefrom as the SEC may grant.
6
IN WITNESS WHEREOF, the parties hereto have caused this agreement to be
executed by their respective officers thereunto duly authorized.
Attest: Aon Funds
/s/ Xxxxxxxxx X. Xxxxxx /s/ Xxxxxxx X. Xxxxxx
------------------------------------ -----------------------
Secretary President
Attest: Aon Advisors, Inc.
/s/ Xxxxxxxxx X. Xxxxxx /s/ Xxxxxxx X. Xxxxxx
------------------------------------ -----------------------
Secretary President
Signature Page for Investment Advisory Agreement
Asset Allocation Fund
INVESTMENT ADVISORY AGREEMENT
This Agreement (hereinafter the "Agreement") made this 1st day of
August, 2000 by and between Aon Funds, a Delaware business trust (hereinafter
the "Trust"), an open-ended management company registered under the Investment
Company Act of 1940, as amended (hereinafter the "1940 Act"), and Aon Advisors,
Inc., a Virginia corporation (hereinafter the "Advisor"), an investment advisor
registered under the Investment Advisers Act of 1940.
1. Furnishing of Documents.
------------------------
1.1 The Trust has furnished the Advisor with copies of each of the
following documents:
(a) Agreement and Declaration of Trust of the Trust;
(b) Bylaws of the Trust as in effect on the date hereof;
(c) The Trust's effective registration statement on Form N-lA as
filed with the Securities and Exchange Commission ("SEC"),
which includes all statements of the investment objective,
policies and restrictions of the Fund of the Trust referred
to below.
1.2 The Trust will furnish the Advisor, from time to time, with copies
of all amendments of or supplements to the foregoing, if any.
1.3 The Advisor will be entitled to rely on all documents so furnished
by the Trust.
2. Investment Advisory Services.
-----------------------------
2.1 Subject to the supervision and approval of the Trust's trustees (the
"Trustees"), the Trust hereby employs the Advisor to act as the investment
advisor to, and manager of, the Trust's REIT Index Fund (hereinafter the
"Fund").
2.2 The Advisor hereby agrees to manage the investment and reinvestment
of the assets of the Fund, at its own expense, in accordance with the Fund's
investment objective, policies and restrictions as stated in the documents
referred to in Section l.1(a), (b) and (c) hereof.
2.3 The Advisor agrees, for the term of this Agreement, to assume the
obligations set forth in this Agreement for the compensation provided and on the
other terms and conditions set forth in this Agreement.
2.4 The Advisor shall:
(a) provide, or obtain, and evaluate such economic, statistical
and financial data and information and undertake such
additional investment research as it shall believe necessary
or advisable;
(b) conduct a continuous program of investment and reinvestment
with respect to the Fund's assets and, with respect thereto,
the Advisor is hereby granted full authority by the Trust to
place orders for purchases,
sales, exchanges or other dispositions of securities and
other instruments for the Fund's account and to manage the
investments and any other property of the Fund, and to
provide or obtain such services as may be necessary in
managing, acquiring or disposing of investments;
(c) consult with and report to the Trustees, or any committees
or officers acting pursuant to authority of the Trustees, at
such times and in such manner as the Trustees may deem
appropriate, with respect to the implementation of the
investment objective, policies and restrictions of the Fund;
and
(d) at the Trust's request, provide persons to serve as trustees
and officers of the Trust.
3. Investment Advisory Fee.
------------------------
3.1 In consideration of all services rendered pursuant to Section 2 of
this Agreement, the Fund shall pay to the Advisor, after the end of each
calendar month, a fee, accrued daily and based upon the average daily net asset
value of the Fund for the month (or portion thereof during which this Agreement
is in effect), at an annual rate of 0.10% (10/100ths of 1%).
3.2 If on any day there is no determination of the net asset value of
the Fund as a result of a suspension of the right of redemption of Fund shares
or for any other reason, then for the purpose of this Section 3, the net asset
value of the Fund as last determined will be deemed to be the net asset value
for such day.
4. Expenses.
---------
4.1 The Advisor will bear all expenses in connection with the
performance of its services under this Agreement.
4.2 The Trust or the Fund will assume and pay, or enter into
arrangements providing for the direct payment subject to reimbursement of, all
other expenses incurred in the operation of the Fund or the Trust that are
incurred by or allocated to the Fund, including:
(a) taxes and fees payable by the Fund or the Trust to federal,
state or other government agencies;
(b) brokerage fees and commissions, and issue and transfer
taxes;
(c) interest;
(d) Trustees' annual retainer and meeting attendance fees and
expenses of Trustees who are not directors, officers or
employees of the Advisor or of any affiliated person, other
than a registered investment company, of the Advisor;
(e) registration, qualification, filing and other fees in
connection with securities registration requirements of
federal and state regulatory authorities;
2
(f) the charges and expenses for custodial, paying agent,
transfer agent, administration, dividend agent and
accounting agent services,
(g) outside legal fees and expenses in connection with the
affairs of the Trust, including, but not limited to,
registering and qualifying its shares with federal and state
regulatory authorities;
(h) charges and expenses of outside auditors;
(i) costs of meetings of shareholders and Trustees of the Trust;
(j) costs of maintenance of the Trust's existence as a Delaware
business trust;
(k) insurance premiums;
(l) investment advisory fees;
(m) costs and fees associated with printing and delivering
registration statements, shareholders' reports and proxy
statements;
(n) costs and fees associated with delivering reports to and
making filings with the SEC and state Blue Sky authorities;
(o) costs relating to administration of the Trust's general
operations;
(p) costs relating to the Trust's own employees, if any; and
(q) costs of preparing, printing and delivering the Trust's
prospectuses and statements of additional information to
existing shareholders of the Fund.
5. Reimbursement.
--------------
5.1 If in any fiscal year, the aggregate expense of the Fund, including
fees pursuant to this Agreement, but excluding interest, taxes, brokerage
commissions and extraordinary expenses, exceeds 1.50% of the first $30 million
of the average daily net assets of the Fund and 1.25% of the amount by which the
average daily net assets of the Fund exceeds $30 million, the Advisor will
reimburse the Fund for such excess. This expense reimbursement obligation is not
limited to the amount of the fees received hereunder and will be estimated,
reconciled and paid on a monthly basis.
6. Fund Transactions and Brokerage.
--------------------------------
6.1 The Fund's transactions in equity securities will usually be
executed through brokers that will receive a commission paid by the Fund. The
Fund's transactions in fixed income and money market securities shall usually be
effected with the issuer or with a dealer in such instruments acting as
principal on a net basis. The Fund also may purchase underwritten issues, which
involve an underwriting discount or commission. Decisions with respect to the
purchase and sale of portfolio securities, including allocation of portfolio
business and the negotiation of the price of the securities and commissions, if
any, are to be made by the Advisor.
3
6.2 Neither the Advisor nor any company affiliated with it shall act as
a broker or dealer for the purpose of executing portfolio transactions for the
Fund.
6.3 The primary consideration in allocating transactions to dealers and
brokers shall be prompt and effective execution of orders at the most favorable
security prices obtainable ("best execution"). Consideration also may be given
to additional factors, such as furnishing of supplemental research and other
services deemed to be of value to the Trust, the Fund or the Advisor. The
Advisor is authorized to execute orders with dealers or brokers that provide
research and security and economic analysis that supplements the research and
analysis of the Advisor, even though the spread or commission at which an order
is executed may be higher than that which another dealer or broker might charge,
provided that the Advisor determines in good faith that the amount of the spread
or commission is reasonable in relation to the value of the services provided.
Such research and services include advice as to the value of securities, the
advisability of investment in, purchasing or selling securities, and the
availability of securities or purchasers or sellers of securities; furnishing
analyses and reports concerning issuers, industries, securities, economic
factors and trends, portfolio strategy and performance of accounts; and
effecting securities transactions and performing functions incidental thereto
(such as clearance and settlement). The research may be useful to the Advisor in
serving other portfolios of the Trust, the Fund and other accounts managed by
the Advisor.
7. Similar Activities for Others.
------------------------------
7.1 The services of the Advisor to the Fund under this Agreement are not
to be deemed exclusive and the Advisor will be free to render similar services
to others so long as its services under this Agreement are not impaired.
Investment decisions for the Fund will be made independently from those of other
accounts that may be managed by the Advisor. If, however, accounts managed by
the Advisor are simultaneously engaged in purchases of the same securities,
then, pursuant to the authorization of the Trustees, available securities may be
allocated to each account and may be averaged as to price in whatever manner the
Advisor deems to be fair.
7.2 The parties to this Agreement understand that this system might
adversely affect the price paid by the Fund, or limit the size of the position
obtainable for the Fund. To the extent that transactions on behalf of more than
one client of the Advisor during the same period may increase the demand for
securities being purchased or the supply of securities being sold, the Trust and
the Fund recognize that there may be an adverse effect on price.
8. Compliance and Maintenance of Records.
--------------------------------------
8.1 The Advisor agrees to manage the investment and reinvestment of the
Fund's assets in compliance with the 1940 Act and rules and regulations
thereunder. The Advisor also agrees to maintain and preserve, in accordance with
the 1940 Act and rules thereunder, and for the periods prescribed by Rule 3la-2
under the 1940 Act, books and records with respect to the Fund's securities
transactions required to be maintained by Rule 3la-1 under the 1940 Act.
8.2 The Advisor further agrees that all records which it maintains for
the Fund are the Trust's property and that the Advisor will surrender them to
the Trust, its independent auditors, the Trustees, or as may be required by any
government agency having jurisdiction over the Trust, promptly upon written
request. The provisions of this Section 8 shall survive any termination of this
Agreement.
4
9. Dual Interests.
---------------
9.1 It is understood by both parties that any of the shareholders,
trustees, officers, employees and agents of the Trust may be a director,
officer, employee or agent of, or be otherwise interested in, the Advisor, any
affiliated person of the Advisor, or any organization in which the Advisor or
any affiliated person of the Advisor may have an interest; and that the Advisor,
and any such affiliated person or any such organization may have an interest in
the Trust or the Fund.
9.2 It is also understood by both parties that the existence of any such
dual interest shall not affect the validity of any transactions hereunder,
except as otherwise provided by specific provisions of applicable law, including
the 1940 Act.
10. Duration, Termination and Amendment of this Agreement.
-----------------------------------------------------
10.1 This Agreement shall not become effective, and the Advisor shall
not serve or act as the Fund's investment advisor, unless and until this
Agreement is approved by the Trust's board of trustees (the "Board"), including
a majority of the Trustees who are not parties to this Agreement or interested
persons of any such party to this Agreement, cast in person at a meeting called
for the purpose of voting on such approval, and by a vote of a majority of the
outstanding voting securities of the Fund.
10.2 If approved as provided above, this Agreement shall continue in
effect for two years and from year to year thereafter, but only so long as such
continuance is specifically approved at least annually either:
(a) by the Board; or
(b) by a vote of a majority of the outstanding voting securities
of the Fund.
In either event such continuance also must be approved by the vote of a majority
of the Trustees who are not parties to this Agreement or interested persons of
the Trust or of the Advisor, cast in person at a meeting called for the purpose
of voting on such approval.
10.3 This Agreement may, on sixty days' written notice, be terminated at
any time, without the payment of any penalty, by the Board, by a vote of a
majority of the Fund's outstanding voting securities of the Fund or by the
Advisor.
10.4 This Agreement shall automatically terminate in the event of its
assignment.
10.5 In interpreting the provisions of this Section 10, the definitions
contained in Section 2(a) of the 1940 Act, particularly the definitions of
"interested person" and "assignment" and a "majority of the outstanding voting
securities," shall be applied.
10.6 This Agreement shall not be amended without specific approval of
such amendment by:
(a) the vote of a majority of the outstanding voting securities
of the Fund; and
(b) the vote of a majority of the Trustees, including a majority
of the Trustees who are not parties to this Agreement and
who are not interested persons
5
of the Trust or of the Advisor, cast in person at a meeting
called for the purpose of voting on such amendment.
11. Liability of the Advisor.
-------------------------
11.1 In the absence of willful misfeasance, bad faith, gross negligence
or reckless disregard of obligations or duties on the part of the Advisor, or of
its officers, directors, agents, employees, controlling persons, shareholders,
or any other person or entity affiliated with the Advisor or retained by it to
perform or assist in the performance of its obligations under this Agreement
(each of the foregoing, an "Advisory Affiliate"), neither the Advisor nor any
Advisory Affiliate shall be subject to liability to the Trust or the Fund or to
any shareholder of the Fund or to any other person with a beneficial interest in
the Fund or the Trust for any act or omission in the course of, or connected
with, rendering services hereunder, including without limitation any error of
judgment or mistake of law or for any loss suffered by the Trust or the Fund or
any shareholder or other person in connection with the matters to which this
Agreement relates, except to the extent specified in Section 36(b) of the 1940
Act concerning loss resulting from a breach of fiduciary duty with respect to
the receipt of compensation for services.
12. Use of Name "Aon" Marks or Symbols.
----------------------------------
12.1 If the Advisor ceases to act as the investment advisor, or, in any
event, if the Advisor so requests in writing, the Trust agrees it will take all
necessary action to change the name of the Trust and/or the Fund to a name not
including the word "Aon."
13. Miscellaneous.
--------------
13.1 The Advisor may from time to time employ or associate with any
person or persons it may believe to be particularly fitted to assist it in the
performance of this Agreement. The compensation of any such persons will be paid
by the Advisor, and no obligation will be incurred by, or on behalf of, the
Trust with respect to them. In addition, the Trust understands that the persons
employed by the Advisor to assist in the performance of its duties hereunder
will not devote their full time to those duties, and that nothing contained
herein will be deemed to limit or restrict the Advisor's right or the right of
any of the Advisor's affiliates to engage in and devote time and attention to
other businesses or to render other services of whatever kind or nature.
13.2 The captions 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.
13.3 This Agreement may be executed simultaneously in two or more
counterparts, each of which will be deemed an original, but all of which
together will constitute one and same instrument.
13.4 It is intended by the parties that this Agreement be governed by
the law of the State of Illinois; however, this Agreement is also governed by,
and subject to, the 1940 Act, and rules thereunder, including such exemptions
therefrom as the SEC may grant.
6
IN WITNESS WHEREOF, the parties hereto have caused this agreement to be
executed by their respective officers thereunto duly authorized.
Attest: Aon Funds
/s/ Xxxxxxxxx X. Xxxxxx /s/ Xxxxxxx X. Xxxxxx
------------------------------------ -----------------------
Secretary President
Attest: Aon Advisors, Inc.
/s/ Xxxxxxxxx X. Xxxxxx /s/ Xxxxxxx X. Xxxxxx
------------------------------------ -----------------------
Secretary President
Signature Page for Investment Advisory Agreement
REIT Index Fund
