EXHIBIT 5(B)
MANAGEMENT CONTRACT
AGREEMENT made as of the 28th day of December, 1994, by and between
Xxxxxx Xxxxxxxx Investment Trust (the "Trust"), on behalf of Xxxxxx Xxxxxxxx
Fixed Income Fund and Xxxxxx Xxxxxxxx Municipal Bond Fund (the "Portfolios"),
and Xxxxxx Xxxxxxxx Capital Management, Incorporated (the "Adviser").
WHEREAS, the Trust is an open-end, diversified management investment
company registered under the Investment Company Act of 1940, as amended,
consisting of several series of shares, each having its own investment policies;
and
WHEREAS, the Trust has retained SEI Financial Management Corporation
(the "Administrator") to provide administration of the Trust's operations,
subject to the control of the Board of Trustees;
WHEREAS, the Trust desires to retain the Adviser to render investment
management services with respect to the Portfolios and the Adviser is willing to
render such services:
NOW, THEREFORE, in consideration of mutual covenants herein contained,
the parties hereto agree as follows:
1 Duties of Adviser. The Trust employs the Adviser to manage the
investment and reinvestment of the assets, and to continuously
review, supervise, and administer the investment programs of the
Portfolios, to determine in its discretion the securities to be
purchased or sold, to provide the Administrator and the Trust
with records concerning the Adviser's activities which the Trust
is required to maintain, and to render regular reports to the
Administrator and to the Trust's officers and trustees concerning
the Adviser's discharge of the foregoing responsibilities.
The Adviser shall discharge the foregoing responsibilities
subject to the control of the Board of Trustees of the Trust and
in compliance with such policies as the Trustees may from time to
time establish, and in compliance with the objectives, policies,
and limitations for each such Portfolio set forth in the
Portfolio's prospectus and statement of additional information,
as amended from time to time, and applicable laws and
regulations.
-1-
The Adviser accepts such employment and agrees, at its own
expense, to render the services and to provide the office space,
furnishings and equipment and the personnel required by it to
perform the services on the terms and for the compensation
provided herein.
2. Portfolio Transactions. The Adviser is authorized to select the
brokers or dealers that will execute the purchases and sales of
portfolio securities for the Portfolios and is directed to use
its best efforts to obtain the best net results as described from
time to time in the Portfolios' Prospectus and Statement of
Additional Information. The Adviser will promptly communicate to
the Administrator and to the officers and the Trustees of the
Trust such information relating to portfolio transactions as they
may reasonably request.
It is understood that the Adviser will not be deemed to have
acted unlawfully, or to have breached a fiduciary duty to the
Trust or be in breach of any obligation owing to the Trust under
this Agreement, or otherwise, solely by reason of its having
directed a securities transaction on behalf of the Trust to a
broker-dealer in compliance with the provisions of Section 28(e)
of the Securities Exchange Act of 1934 or as otherwise permitted
from time to time by the Portfolios' Prospectus and Statement of
Additional Information.
3. Compensation of the Adviser. For the services to be rendered by
the Adviser as provided in Sections 1 and 2 of this Agreement,
the Trust shall pay to the Adviser compensation at the rates
specified in the Schedule(s) which are attached hereto and made a
part of this Agreement. Such compensation shall be paid to the
Adviser at the end of each month, and calculated by applying a
daily rate, based on the annual percentage rates as specified in
the attached Schedule(s), to the assets of each Portfolio. The
fee shall be based on the average daily net assets for the month
involved (less any assets of such Portfolios held in non-interest
bearing special deposits with a Federal Reserve Bank).
All rights of compensation under this Agreement for services
performed as of the termination date shall survive the
termination of this Agreement.
4. Other Expenses. The Adviser shall pay all expenses of printing
and mailing reports, prospectuses, statements of additional
information, and sales literature relating to its efforts to
solicit prospective clients.
-2-
5. Excess Expenses. If the expenses for either Portfolio for any
fiscal year (including fees and other amounts payable to the
Adviser, but excluding interest, taxes, brokerage costs,
litigation, and other extraordinary costs) as calculated every
business day would exceed the expense limitations imposed on
investment companies by any applicable statute or regulatory
authority of any jurisdiction in which shares of a Portfolio are
qualified for offer and sale, the Adviser shall bear such excess
cost.
However, the Adviser will not bear expenses of a Portfolio which
would result in the Portfolio's inability to qualify as a
regulated investment company under provisions of the Internal
Revenue Code of 1986, as amended. Payment of expenses by the
Adviser pursuant to this Section 5 shall be settled on a monthly
basis (subject to fiscal year end reconciliation) by a reduction
in the fee payable to the Adviser for such month pursuant to
Section 3 and, if such reduction shall be insufficient to offset
such expenses, by reimbursing the Trust.
6. Reports. The Trust and the Adviser agree to furnish to each
other, if applicable, current prospectuses, proxy statements,
reports to Shareholders, certified copies of their financial
statements, and such other information with regard to their
affairs as each may reasonably request.
7. Status of Adviser. The services of the Adviser to the Trust are
not to be deemed exclusive, and the Adviser shall be free to
render similar services to others so long as its services to the
Trust are not impaired thereby. The Adviser shall be deemed to be
an independent contractor and shall, unless otherwise expressly
provided or authorized, have no authority to act for or represent
the Trust in any way or otherwise be deemed an agent of the
Trust.
8. Certain Records. Any records required to be maintained and
preserved pursuant to the provisions of Rule 31a-1 and Rule 31a-2
promulgated under the Investment Company Act of 1940 which are
prepared or maintained by the Adviser on behalf of the Trust are
the property of the Trust and will be surrendered promptly to the
Trust on request.
-3-
9. Limitation of Liability of Adviser. The duties of the Adviser
shall be confined to those expressly set forth herein, and no
implied duties are assumed by or may be asserted against the
Adviser hereunder. The Adviser shall not be liable for any error
of judgment or mistake of law or for any loss arising out of any
investment or for any act or omission in carrying out its duties
hereunder, except a loss resulting from willful misfeasance, bad
faith or gross negligence in the performance of its duties, or by
reason of reckless disregard of its obligations and duties
hereunder, except as may otherwise be provided under provisions
of applicable state law or Federal securities law which cannot be
waived or modified hereby. (As used in this Paragraph 9, the term
"Adviser" shall include directors, officers, employees and other
corporate agents of the Adviser as well as that corporation
itself).
10. Permissible Interests. Trustees, agents, and shareholders of the
Trust are or may be interested in the Adviser (or any successor
thereof) as directors, partners, officers, or shareholders, or
otherwise; directors, partners, officers, agents, and
shareholders of the Adviser are or may be interested in the Trust
as Trustees, shareholders or otherwise; and the Adviser (or any
Successor) is or may be interested in the Trust as a Shareholder
or otherwise. In addition, brokerage transactions for the
Portfolios may be effected through affiliates of the Adviser if
approved by the Board of Trustees, subject to the rules and
regulations of the Securities and Exchange Commission.
11. License of Adviser's Name. The Adviser hereby agrees to grant a
license to the Trust for use of its name in the names of the
Portfolios for the term of this Agreement and such license shall
terminate upon termination of this Agreement.
12. Duration and Termination. This Agreement, unless sooner
terminated as provided herein, shall remain in effect with
respect to a Portfolio until two years from the date first set
forth above, and thereafter, for periods of one year so long as
such continuance thereafter is specifically approved at least
annually (a) by the vote of a majority of those Trustees of the
Trust who are not parties to this Agreement or interested persons
of any such party, cast in person at a meeting called for the
purpose of voting on such approval, and (b) by the Trustees of
the Trust or by vote of a majority of the outstanding voting
securities of the Portfolio;
-4-
provided, however, that if the shareholders of either Portfolio
fail to approve the Agreement as provided herein, the Adviser may
continue to serve hereunder in the manner and to the extent
permitted by the Investment Company Act of 1940 and rules and
regulations thereunder. The foregoing requirement that
continuance of this Agreement be "specifically approved at least
annually" shall be construed in a manner consistent with the
Investment Company Act of 1940 and the rules and regulations
thereunder.
This Agreement may be terminated as to either Portfolio at any
time, without the payment of any penalty by vote of a majority of
the Trustees of the Trust or by vote of a majority of the
outstanding voting securities of the Portfolio on not less than
30 days nor more than 60 days written notice to the Adviser, or
by the Adviser at any time without the payment of any penalty, on
90 days written notice to the Trust. This Agreement will
automatically and immediately terminate in the event of its
assignment. Any notice under this Agreement shall be given in
writing, addressed and delivered, or mailed postpaid, to the
other party at any office of such party.
As used in this Section 12, the terms "assignment", "interested
persons", and a "vote of a majority of the outstanding voting
securities" shall have the respective meanings set forth in the
Investment Company Act of 1940 and the rules and regulations
thereunder, subject to such exemptions as may be granted by the
Securities and Exchange Commission under said Act.
13. Notice. Any notice required or permitted to be given by either
party to the other shall be deemed sufficient if sent by
registered or certified mail, postage prepaid, addressed by the
party giving notice to the other party at the last address
furnished by the other party to the party giving notice: if to
the Trust, at 000 Xxxxx Xxxxxx, Xxx Xxxx, XX 00000 and if to the
Adviser at 000 Xxxxx Xxxxxx, Xxx Xxxx, XX 00000.
14. Severability. If any provision of this Agreement shall be held or
made invalid by a court decision, statute, rule or otherwise, the
remainder of this Agreement shall not be affected thereby.
A copy of the Certificate of Trust of the Trust is on file with the Secretary of
State of the State of Delaware, and notice is hereby given that this instrument
is executed on behalf of the
-5-
Trustees of the Trust as Trustees, and is not binding upon any of the Trustees,
officers, or shareholders of the Trust individually but binding only upon the
assets and property of the Trust.
IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed
as of the day and year first written above.
XXXXXX XXXXXXXX INVESTMENT TRUST
on behalf of
Xxxxxx Xxxxxxxx Fixed Income Fund
Xxxxxx Xxxxxxxx Municipal Bond Fund
By: /s/ Xxxx X. Xxxxxx
-----------------------------------------
Xxxx X. Xxxxxx
Secretary
Attest: /s/ Xxxxxx Xxxxxxxxx
-----------------------------------------
XXXXXX XXXXXXXX CAPITAL MANAGEMENT INCORPORATED
By: /s/ Xxxxx X. Xxxxxxx
-----------------------------------------
Xxxxx X. Xxxxxxx
President
Attest: /s/ Xxxxxx Xxxxxxxxx
-----------------------------------------
-6-
Schedule
to the
Investment Advisory Agreement
between
Xxxxxx Xxxxxxxx Investment Trust
on behalf of Xxxxxx Xxxxxxxx Fixed Income
Fund and Xxxxxx Xxxxxxxx Municipal Bond Fund
and
Xxxxxx Xxxxxxxx Capital Management Incorporated
Pursuant to Article 3, the Trust, on behalf of each Portfolio, shall pay the
Adviser compensation at an annual rate as follows:
Portfolio Fee
---------------------------------- ----------------------------------
Xxxxxx Xxxxxxxx Municipal .40% of the average
Bond Fund daily net assets
Xxxxxx Xxxxxxxx Fixed .40% of the average
Income Fund daily net assets
-7-
