INVESTMENT ADVISORY AGREEMENT
XXXXX & STEERS REALTY SHARES, INC.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
June 28, 1991
XXXXX & STEERS CAPITAL
MANAGEMENT, INC.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
We, the undersigned Xxxxx & Steers Realty Shares, Inc., herewith
confirm our agreement with you as follows:
1. We are an open-end, non-diversified management investment company
registered under the Investment Company Act of 1940 (the "Act"). we are
currently authorized to issue separate classes of shares and our Directors are
authorized to reclassify and issue any unissued shares to any number of
additional classes or series (portfolios) each having its own investment
objective, policies and restrictions, all as more fully described in the
prospectus and the statement of additional information constituting parts of the
Registration Statement filed on our behalf under the Securities Act of 1933 and
the Act. We propose to engage in the business of investing and reinvesting our
assets in securities of the type and in accordance with the limitations
specified in our Articles of Incorporation, By-Laws, Registration Statement
filed
with the Securities and Exchange Commission under the Securities Act of 1933 and
the Act, and any representations maze in our prospectus and statement of
additional information, all in such manner and to such extent as may from time
to time be authorized by our Board of Directors. We enclose copies of the
documents listed above and will from time to time furnish you with any
amendments thereof.
2. (a) We hereby employ you to manage the investment and
reinvestment of our assets as above specified and, without limiting the
generality of the foregoing, to provide management and other services specified
below.
(b) You will make decisions with respect to all purchases and
sales of our portfolio securities. To carry out such decisions, you are hereby
authorized, as our agent and attorney-in-fact, for our account and at our risk
and in our name, to place orders for the investment and reinvestment of our
assets. In all purchases, sales and other transactions in our portfolio
securities you are authorized to exercise full discretion and act for us in the
same manner and with the same force and effect as we might do with respect to
such purchases, sales or other as well as with respect to all other things
necessary or incidental to the furtherance or conduct of such purchases, sales
or other transactions.
(c) You will report to our Board of Directors at each meeting
thereof all changes in our portfolio since the prior report, and will also keep
us in touch with important developments
affecting our portfolio and on your own initiative will furnish us from time to
time with such information as you may believe appropriate for this purpose,
whether concerning the individual issuers whose securities are included in our
portfolio, the industries in which they engage, or the conditions prevailing in
the economy generally. You will also furnish us with such statistical and
analytical information with respect to our portfolio securities as you may
believe appropriate or as we reasonably may request. In making such purchases
and sales of our portfolio securities, you will bear in mind the policies set
from time to time by our Board of Directors as well as the limitations imposed
by our Articles of Incorporation and in our Registration Statement under the Act
and the Securities Act of 1933, the limitations in the Act and of the Internal
Revenue Code of 1936, as amended, in respect of regulated investment companies.
(d) is understood that you will from time to time employ or
associate with yourselves such persons as you believe to be particularly fitted
to assist you in the execution of your duties hereunder, the cost of performance
of such duties to be borne and paid by you. No obligation may be incurred on our
behalf in any such respect. During the continuance if this agreement at our
request you will provide us persons satisfactory to our Board of Directors to
serve as our officers.
3. We propose to retain the services of an administrator, which
shall be a firm acceptable to you, to administer all aspects of our operations
except those which are
your responsibility pursuant to this agreement. We will bear the cost of and pay
the fee of the administrator. Our initial administrator will be Mutual Funds
Service Company.
4. It is further agreed that you shall be responsible for the
portion of our net expenses (except interest, taxes, brokerage, expenditures
which are capitalized in accordance with generally accepted accounting
principles and extraordinary expenses, all to the extent permitted by applicable
state law and regulation) incurred by us during each of our fiscal years or
portion thereof that this agreement is in effect between us which, in any such
year exceeds the limits applicable to us under the laws or regulations of any
state in which our shares are qualified for sale (reduced pro rata for any
portion of less than a year). We hereby confirm that, subject to the foregoing,
we shall be responsible and hereby assume the obligation for payment of all our
other expenses, including: (a) payment of the fee payable to you under paragraph
6 hereof; (b) charges and expenses of our administrator, custodian, transfer,
and dividend disbursing agent; (c) fees of directors who are not your affiliated
persons; (d) legal and auditing expenses; (e) compensation of our officers,
Directors and employees who do not devote any part of their time to your affairs
or the affairs of your affiliates other than us; (f) costs of printing our
prospectuses and stockholder reports; (g) costs of proxy solicitation; (h) cost
of maintenance of corporate existence; (i) interest charges, taxes, brokerage
fees and commissions; (j) costs of stationery and supplies; (k) expenses and
fees related to registration and filing with the Securities and Exchange
commission and with state regulatory authorities; and (l) upon the approval of
the Board of Directors, costs of your personnel or your affiliates rendering
clerical, accounting and other office services.
5. We shall expect of you, and you will give us the benefit of, your
best judgment and efforts in rendering these services to us, and we agree as an
inducement to your undertaking these services that you shall not be liable
hereunder for any mistake of judgment or in any event whatsoever, except for
lack of good faith, provided that nothing herein shall be deemed to protect, or
purport to protect, you against any liability to us or to our security holders
to which you would otherwise be subject by reason of willful misfeasance, bad
faith or gross negligence in the performance of your duties hereunder, or by
reason of your reckless disregard of your obligations and duties hereunder.
6. In consideration of the foregoing we will pay you a monthly fee
at an annualized rate of .85 of 1% of our average daily net assets. Such fee
shall be payable in arrears on the last day of each calendar month for services
performed hereunder during such month. If our initial Registration Statement is
declared effective by the Securities and Exchange Commission after the beginning
of a month or this agreement terminates prior to the end of a month, such fee
shall be prorated according to the proportion which such portion of the month
bears to the full month.
7. This agreement shall become effective on the date on which our
pending Registration Statement on Form N-1A relating to our shares becomes
effective and shall remain in effect until the first meeting of our shareholders
held after such date and, if approved by the vote of a majority of the
outstanding voting securities, as defined in the Act, at such meeting, continue
in effect until December 31, 1992 and may be continued for successive
twelve-month periods (computed from each January 1) with respect to each
portfolio provided that such continuance is specifically approved at least
annually by the Board of Directors or by majority vote of the holders of the
outstanding voting securities of such portfolio (as defined in the Act), and, in
either case, by a majority of the Board of Directors who are not interested
persons as defined in the Act, of any party to this agreement (other than as
Directors of our corporation), provided further, however, that if the
continuation of this agreement is not approved, you may continue to render the
services described herein in the manned to the extent permitted by the Act and
the rules and regulations thereunder. Upon the effectiveness of this agreement,
it shall supersede all previous agreements between us covering the subject
matter hereof. This agreement may be terminated at any time, without the payment
of any penalty, by vote of a majority of the outstanding voting securities (as
so defined) or by a vote of a majority of the Board of Directors on 60 days'
written notice to you, or by you on 60 days' written notice to us.
8. This agreement may not be transferred, assigned, sold or in any
manner hypothecated or pledged by you and this agreement shall terminate
automatically in the event of any such transfer, assignment, sale, hypothecation
or pledge by you. The terms "transfer", "assignment" and "sale" as used in this
paragraph shall have the meanings ascribed thereto by governing law and any
interpretation thereof contained in rules or regulations promulgated by the
Securities and Exchange Commission thereunder.
9. Except to the extent necessary to perform your obligations
hereunder, nothing herein shall be deemed to limit or restrict your right, or
the right of any of your officers, directors or employees, who may also be a
Director, officer or employee of ours, or persons otherwise affiliated with us
(within the meaning of the Act) to engage in any other business or to devote
time and attention to the management or other aspects of any other business,
whether of a similar or dissimilar nature, or to render services of any kind to
any other trust, corporation, firm, individual or association.
10. This agreement shall be construed in accordance with the laws of
the State of New York, provided, however, that nothing herein shall be construed
as being inconsistent with the Act.
If the foregoing is in accordance with your understanding, will you
kindly so indicate by signing and returning to us the enclosed copy hereof.
Very truly yours,
XXXXX & STEERS REALTY SHARES, INC.
By: /s/ Xxxxxx X. Xxxxxx
------------------------------------
Chairman
Agreed to and accepted
as of the date first set forth above
XXXXX & STEERS CAPITAL MANAGEMENT, INC.
By: /s/ Xxxxxx Xxxxx
-----------------------------------
President
