Exhibit (d)(3)
[Conformed Copy]
SERVICES AGREEMENT
This AGREEMENT, dated as of February 15, 2002 by and between Xxxxxx Xxxxxxx
Asset & Investment Trust Management Co., Limited, a Japanese corporation with
its principal place of business at Yebisu Garden Xxxxx Xxxxx, 00-0, Xxxxx
0-Xxxxx, Xxxxxxx-xx, Xxxxx 000, Xxxxx ("MSAITM") and Xxxxxx Xxxxxxx Investment
Management Inc., a Delaware corporation with its principal place of business at
0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, XX 00000 ("Affiliate").
W I T N E S S E T H
WHEREAS, MSAITM and Affiliate are both registered investment advisers in
their respective places of business;
WHEREAS, MSAITM and Affiliate regularly retain each other's services as a
sub-adviser for investment advisory and management agreements and securities
investment trusts;
WHEREAS, MSAITM and Affiliate wish to establish common terms and conditions
pursuant to which they wish to retain each other's advisory services from time
to time; and
WHEREAS, Service Agreements entered into prior to the date of this
Agreement are deemed ratified by the parties hereto, as evidenced by a new
Appendix entered into pursuant to the terms herein.
NOW, THEREFORE, in consideration of the premises and the mutual covenants
hereinafter contained, MSAITM and Affiliate hereby agree as follows:
1. DEFINED TERMS
(a) Except as otherwise defined in this Agreement or in an Appendix, the
capitalized terms used in this Agreement shall have the following meanings:
"Adviser" shall mean for each Portfolio the party that is providing
advisory services pursuant to the Appendix for that Portfolio.
"Appendix" shall mean a Service Request that has been accepted in
accordance with the terms of this Agreement.
"Manager" shall mean for each Portfolio the party to which advisory
services are provided under this Agreement.
"Portfolio" shall mean the assets of a specified client designated as such
in an Appendix.
"Service Request" shall mean a request to provide advisory services under
this Agreement in the form of Exhibit A.
"Services" shall mean the services described in section 2.
(b) Except where otherwise specified, all references to parties, sections,
sub-sections, Exhibits and Appendixes are to parties, sections, sub-sections,
Exhibits and Appendixes to this Agreement. All references to a singular noun
include the plural and each pronoun includes all genders.
2. DUTIES OF THE ADVISER
(a) Except as otherwise provided in an Appendix, the Adviser shall provide
the following services to the Manager.
(1) Where the Appendix specifies "investment advisory services" the
Adviser shall furnish (as may be requested by the Manager) one or
more of the following:
(i) recommendations concerning country and asset allocations
for the Portfolio, factual information, research reports,
including reports (written and oral), analyses,
statistical information and advice concerning market
trends;
(ii) investment recommendations regarding investment for the
Portfolio, including advice concerning specific
industries, companies and securities to be purchased or
sold by the Portfolio;
(iii) advice with respect to the derivative transactions to be
engaged in by the Portfolio, both for hedging and
non-hedging purposes; and
(iv) such other information as may be requested from time to
time.
(2) Where the Appendix specifies "discretionary investment management
services" the Adviser shall perform one or more of the following
services in the manner requested by the Manager:
(i) manage the investment of the assets of the Portfolio in
accordance with the investment objectives, policies and
limitations set forth in the relevant Appendix, and in
that connection to review, supervise and administer
continuously the investment program of the Portfolio, to
determine in the Adviser's discretion the securities to
be purchased or sold and the portion of the Portfolio's
assets to be held uninvested;
(ii) select and place orders for securities and other property
constituting assets of the Portfolio with brokers,
dealers, banks and members of securities exchanges;
(iii) execute waivers, consents and other instruments with
respect to securities and other assets of the Portfolio;
(iv) endorse, transfer or deliver such securities and to
participate in or consent to any plan of reorganization,
merger, combination, consolidation, liquidation or
similar plan with reference to securities;
(v) exercise any voting right exercisable by a holder of any
of the securities of the Portfolio;
(vi) send the Manager daily trade details upon confirming
transactions with brokers, dealers, banks or members of
securities exchanges;
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(vii) maintain on behalf of the Manager the records regarding
the Agent's activities specified in the relevant
Appendix; and
(viii) render regular reports to the Manager concerning the
Adviser's discharge of its obligations with respect to a
Portfolio in accordance with the requirements set forth
in the relevant Appendix.
(b) In executing transactions pursuant to sub-section (a)(2), the Adviser
shall use its best efforts to obtain the best execution for the Portfolio,
taking into account factors including, without limitation, price (including
applicable brokerage commission and dealer spread), size of order, difficulty of
execution, operational facilities of the firm involved, the provision of
research and related services by the executing firm and the firm's risk in
positioning a block of securities. Subject to the foregoing criteria, the
Adviser may effect portfolio transactions with any of its affiliated companies.
(c) The Adviser shall not delegate its functions, powers, discretion,
privileges or duties under this section 2 to any person, firm or corporation
without the prior written consent of the Manager.
3. COMPENSATION
In exchange for the Services with respect to a Portfolio, the Manager shall
pay to the Adviser the fees and other compensation as may be separately agreed
between them.
4. NON-EXCLUSIVITY OF SERVICES
(a) Nothing in this Agreement or any Appendix shall be construed as
prohibiting the Adviser from providing services that are the same or similar to
Services, or entering into the same agreements as this with, others (including
other investment companies or other securities investment trusts), so long as
the Adviser's services to the Manager are not impaired thereby.
(b) Nothing in this Agreement or any Appendix shall prevent the Adviser or
its directors, employees, agents or customers from (i) being interested in the
Manager or any beneficial owner of any Portfolio, whether as directors,
employees or investors, or (ii) transacting with the Manager or the Portfolios
in any capacity, or (iii) investing in the same types of investment as the
Portfolios. Nothing in this Agreement or in any Appendix shall be construed to
require the Adviser or its directors, employees, agents or customers to account
for any benefit arising therefrom or disclose such interest.
5. STANDARD OF CARE; INDEMNIFICATION
(a) Unless otherwise provided in an Appendix, the Adviser shall perform
Services to the standard of a professional investment adviser.
(b) Unless otherwise provided in an Appendix, the Manager shall indemnify
and hold harmless the Adviser, its officers, directors, employees, shareholders
and affiliates (each an "Indemnified Party"), from and against any losses, costs
and expenses (including without limitation reasonable attorney's fees) incurred
or suffered by an Indemnified Party arising from any action, proceeding or
claims which may be brought against such Indemnified Party arising out of or in
connection with the performance or non-performance of its duties with respect to
each Portfolio, other than losses, costs and expenses resulting from willful
misconduct or gross negligence in the performance of such Indemnified Party's
duties. This indemnification shall survive the termination of the relevant
Appendix.
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6. DURATION AND TERMINATION
(a) Unless otherwise provided in an Appendix, the duration of the Services
to be provided with respect to each Portfolio shall be for a term of one year
and shall at the end of each term renew automatically for a term of one year.
Either party may terminate an Appendix at any time by 60 days' prior notice or
on such longer notice as may be specified in the Appendix.
(b) Termination of any Appendix shall not affect the right of the Adviser
to receive payments of any unpaid balance of the compensation described in
Section 3 earned prior to such termination and shall not affect any other
Appendix.
7. AMENDMENT; COUNTERPARTS
(a) This Agreement and each Appendix may be amended only by a writing
signed by both parties.
(b) This Agreement may be executed in two or more counterparts, each of
which shall constitute an original, but which when taken together shall
constitute one and the same instrument.
8. ASSIGNMENT
This Agreement may not be assigned by either party without the express
written consent of the other party.
9. GOVERNING LAW
(a) This Agreement is governed by and shall be construed in accordance
with the laws of the State of New York and each party hereby consents to the
non-exclusive jurisdiction of the courts of the State of New York sitting in the
borough of Manhattan for the resolution of any disputes arising out of or in
connection with this Agreement.
(b) To the extent provided in an Appendix, the interpretation of that
Appendix and the provisions of this Agreement as applied to that Appendix shall
be construed in accordance with the laws of the jurisdiction specified in the
Appendix.
10. APPENDIX
(a) MSAITM and Affiliate hereby agree that each Appendix shall constitute
a separate investment advisory agreement between MSAITM and Affiliate
incorporating the terms and conditions specified in this Agreement and in the
Appendix. In the event of any inconsistencies between the provisions of this
Agreement and the provisions of an Appendix, the language of the Appendix shall
govern with respect to the Portfolio described in that Appendix and the language
of this Agreement shall govern in all other respects.
(b) To obtain Services, a party must prepare and sign two copies of a
Service Request and send them to the other party. Upon the other party's
execution and return to the originating party of a Service Request, the Service
Request shall become an Appendix and shall constitute a binding agreement
between the parties. Each Appendix shall be deemed to constitute a delegation of
all powers and authority of the Manager to the extent necessary to enable the
Adviser to perform the Services in respect of that Appendix and an acceptance by
the Adviser of such delegation.
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11. WARRANTIES
(a) Each party makes the following representations and undertakes in
respect of each Portfolio for which it is the Manager that:
(1) it has full power and capacity to execute and deliver the
relevant Appendix and the terms and conditions contained in this
Agreement and that Appendix will be legally binding upon it; and
(2) it has and shall maintain at all times relevant to any Portfolio
(i) due authorization to act as trustor, discretionary investment
manager or investment adviser for that Portfolio, and (ii) all
necessary consents or approvals of any governmental or other
regulatory body; and shall comply with the terms of the same and
with all applicable laws, regulations or directives of such
bodies and authorities; and shall provide the Adviser with copies
of such consents or approvals as it may reasonably request.
(b) Each party makes the following representations and undertakes in
respect of each Portfolio for which it is the Adviser that:
(1) it has and at all times relevant to any Portfolio will have full
power and capacity to enter into and perform its obligations
pursuant to this Agreement and the relevant Appendix and that the
terms and conditions contained in this Agreement the relevant
Appendix will be legally binding upon it; and
(2) it has and shall maintain at all times relevant to any Portfolio
all necessary consents or approvals of any governmental or other
regulatory body and shall comply with the terms of the same and
with all applicable laws, regulations or directives of such
bodies and authorities and shall provide the Manager with copies
of such consents or approvals as it may reasonably request.
12. INDEPENDENT CONTRACTOR
The Adviser shall for all purposes be deemed to be an independent
contractor and, unless otherwise expressly provided or authorized, shall have no
authority to act for or represent the Manager in any way or otherwise be deemed
as an agent of the Manager.
13. COMMUNICATIONS
(a) Any notices, records, communications or instructions to be given or
served under or in connection with this Agreement shall be in writing and shall
be sufficiently given or served if delivered or sent by, international courier
service or by facsimile transmission with confirmation by first class mail
return receipt requested to the address for the party set forth below to such
other address as that party may designate by notice:
If to MSAITM:
Xxxxxx Xxxxxxx Asset & Investment Trust Management Co., Limited
Xxxxxx Xxxxxx Xxxxx Xxxxx, 00-0, Xxxxx 4-Chome,
Shibuya-ku, Tokyo 150 (Japan)
(or such different address or fax number as notified).
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If to Affiliate:
Xxxxxx Xxxxxxx Investment Management Inc.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000 U.S.A.
(b) All notices shall be deemed to be effective upon receipt.
(c) Each of the parties hereby consents to the recording of telephone
conversations between them.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first set forth hereinabove.
XXXXXX XXXXXXX ASSET & INVESTMENT
TRUST MANAGEMENT CO., LIMITED
By: /s/Xxxx X. Xxxxxx
--------------------------------
Name: Xxxx X. Xxxxxx
Title: President
XXXXXX XXXXXXX INVESTMENT
MANAGEMENT INC.
By: /s/Xxxxxx Xxx
--------------------------------
Name: Xxxxxx Xxx
Title: Managing Director
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EXHIBIT A
APPENDIX NO. [ ]
to the Services Agreement by and between Xxxxxx Xxxxxxx Asset & Investment Trust
Management Co., Limited and Xxxxxx Xxxxxxx Investment Management Inc.
dated as of February ___, 2002 (the "Agreement")
PORTFOLIO NAME: [ ]
PART A. PORTFOLIO DETAILS
ACCOUNT NUMBER:
DATE OF MANAGEMENT AGREEMENT:
POWER OF DELEGATION: CLAUSE
GOVERNING LAW AND JURISDICTION:
EFFECTIVE DATE OF DELEGATION TO DELEGATEE:
PART B. SERVICES REQUESTED HEREBY (SPECIFY "ADVISORY SERVICES" OR "DISCRETIONARY
MANAGEMENT SERVICES"): _________________________
DUTIES RETAINED BY THE MANAGER:
The attachment(s) to this Appendix (which is/are incorporated herein by
reference) contain(s) the investment guidelines and restrictions and any other
matters of which the Adviser needs to be aware to perform its obligations in
relation to the Portfolio. Except as specified herein, the terms and conditions
of the Agreement shall govern the obligations of the Manager and the Adviser
with respect to the Portfolio.
As Manager, the undersigned hereby requests Services described herein:
MANAGER
[company name]
By:
-------------------------------------------
Name:
Title:
We acknowledge and agree to provide the Services described herein, as Adviser:
ADVISER
[company name]
By:
-------------------------------------------
Name:
Title:
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