DOW XXXXX ISLAMIC MARKET INDEX PORTFOLIO
INVESTMENT MANAGEMENT AGREEMENT
AGREEMENT, dated March 5, 1999, between DOW XXXXX ISLAMIC MARKET INDEX
PORTFOLIO, a New York trust, (the "Portfolio"), and XXXXX BROTHERS XXXXXXXX &
CO., a New York limited partnership (the "Manager"),
WHEREAS, the Portfolio intends to register under the Investment Company
Act of 1940, as amended (the "1940 Act") as an open-end management investment
company;
WHEREAS, the Portfolio has entered into an investment advisory
agreement (the "Investment Advisory Agreement") with Wafra Investment Advisory
Group, Inc. (the "Adviser") dated March 5, 1999.
WHEREAS, the Portfolio desires to retain the Manager to render
investment management services, and the Manager is willing to render such
services;
NOW, THEREFORE,
WITNESSETH:
that in consideration of the premises and mutual promises hereinafter set forth,
the parties hereto agree as follows:
1. The Portfolio hereby appoints the Manager to act as investment manager
to the Portfolio for the period and on the terms set forth in this Agreement.
The Manager accepts such appointment and agrees to render the services herein
set forth, for the compensation herein provided.
2. Subject to the general supervision of the Board of Trustees of the
Portfolio and based on the advice of the Adviser, the Manager shall manage the
investment operations of the Portfolio and the composition of the Portfolio's
portfolio of securities and investments, including cash, the purchase, retention
and disposition thereof and agreements relating thereto, in accordance with the
Portfolio's investment objective and policies as stated in the Registration
Statement on Form N-1A (as defined in paragraph 3 of this Agreement) and subject
to the following understandings:
(a) the Manager shall furnish a continuous investment program for the
Portfolio and, based upon the advice of the Adviser, shall determine from time
to time what investments or securities will be purchased, retained, sold or lent
by the Portfolio, and what portion of the assets will be invested or held
uninvested as cash;
(b) the Manager shall use the same skill and care in the management of the
Portfolio as it uses in the administration of other accounts for which it has
investment responsibility as agent;
(c) the Manager, in the performance of its duties and obligations under
this Agreement, shall act in conformity with the Portfolio's Declaration of
Trust and By-Laws and the Registration Statement on Form N-1A of the Portfolio
and with the instructions and directions of the Trustees of the Portfolio and
will conform to and comply with the requirements of the 1940 Act and all other
applicable federal and state laws and regulations including, without limitation,
the regulations and rulings of the New York State Banking Department;
(d) the Manager, based upon the advice of the Adviser, shall determine
the securities to be purchased, sold or lent by the Portfolio and as agent for
the Portfolio will effect portfolio transactions pursuant to its determinations
either directly with the issuer or with any broker and/or dealer in such
securities; in placing orders with brokers and or dealers the Manager intends to
seek best price and execution for purchases and sales; the Manager shall
determine whether or not the Portfolio shall enter into repurchase or reverse
repurchase agreements, contracts providing for the making or acceptance of a
cash settlement based upon changes in the value of an index of securities, or
put or call option contracts, with respect to the Portfolio's portfolio of
securities and investments.
On occasions when the Manager deems the purchase or sale of a security
to be in the best interest of the Portfolio as well as other customers, the
Manager, may, to the extent permitted by applicable laws and regulations, but
shall not be obligated to, aggregate the securities to be so sold or purchased
in order to obtain the best execution and lower brokerage commissions, if any.
In such event, allocation of the securities so purchased or sold, as well as the
expenses incurred in the transaction, will be made by the Manager in the manner
it considers to be the most equitable and consistent with its fiduciary
obligations to the Fund and to such other customers;
(e) the Manager shall maintain books and records with respect to the
Portfolio's securities transactions and shall render to the Portfolio's Trustees
such periodic and special reports as the Trustees may reasonably request; and
(f) the investment management services of the Manager to the Portfolio
under this Agreement are not to be deemed exclusive, and the Manager shall be
free to render similar services to others.
3. The Portfolio has delivered copies of each of the following documents to
the Manager and will promptly notify and deliver to it all future amendments and
supplements, if any:
(a) Declaration of Trust of the Portfolio, dated March 5, 1999 (such
Declaration of Trust, as presently in effect and as amended from time to time,
is herein called the "Declaration of Trust");
(b) By-Laws of the Portfolio (such By-Laws, as presently in effect and
as amended from time to time, are herein called the "By-Laws");
(c) Certified resolutions of the Trustees of the Portfolio authorizing
the appointment of the Manager and approving the form of this Agreement;
(d) Registration Statement under the 194O Act, as amended, on Form N-1A
(the "Registration Statement") as filed with the Securities and Exchange
Commission (the "Commission"); and
(e) Notification of Registration of the Portfolio under the 1940 Act on
Form N-8A as filed with the Commission.
4. The Manager shall keep the Portfolio's books and records required to be
maintained by it pursuant to paragraph 2(e). In compliance with the requirements
of Rule 31a-3 under the 1940 Act, the Manager hereby agrees that all records
which it maintains for the Portfolio are the property of the Portfolio and
further agrees to surrender promptly to the Portfolio any such records upon the
Portfolio's request. The Manager further agrees to preserve for the periods
prescribed by Rule 31a-2 under the 1940 Act any such records required to be
maintained by Rule 31a-1 under the 1940 Act.
5. During the term of this Agreement the Manager will pay all expenses
incurred by it in connection with its activities under this Agreement other than
the cost of securities and investments purchased for the Portfolio (including
taxes and brokerage commissions, if any).
6. For the services provided and the expenses borne pursuant to this
Agreement and the Investment Advisory Agreement, the Manager and the Adviser
jointly will receive from the Portfolio as full compensation therefor an
aggregate fee at an annual rate equal to 0.40% of the Portfolio's average daily
net assets. This fee will be computed based on net assets at 4:00 P.M. New York
time on each day the New York Stock Exchange is open for trading, will be paid
monthly during the succeeding calendar month and will be shared between the
Manager and the Adviser as from time to time may be agreed upon by the Manager
and the Adviser.
7. The Manager shall not be liable for any error of judgment or mistake
of law or for any loss suffered by the Portfolio in connection with the matters
to which this Agreement relates, except a loss resulting from a breach of
fiduciary duty with respect to the receipt of compensation for services (in
which case any award of damages shall be limited to the period and the amount
set forth in Section 36(b)(3) of the 0000 Xxx) or a loss resulting from wilful
misfeasance, bad faith or gross negligence on its part in the performance of its
duties or from reckless disregard by it of its obligations and duties under this
Agreement.
8. This Agreement shall continue in effect for two years from the date
of its execution and thereafter, but only so long as its continuance is
specifically approved at least annually in conformity with the requirements of
the 1940 Act; provided, however, that this Agreement may be terminated by the
Portfolio at any time, without the payment of any penalty, by vote of a majority
of all the Trustees of the Portfolio or by,"vote of a majority of the
outstanding voting securities" of the Portfolio on 60 days' written notice to
the Manager, or by the Manager at any time, without the payment of any penalty,
on 90 days' written notice to the Portfolio. This Agreement will automatically
and immediately terminate in the event of its "assignment".
9. The Manager shall for all purposes herein be deemed to be an independent
contractor and shall, unless otherwise expressly provided herein or authorized
by the Trustees of the Portfolio from time to time, have no authority to act for
or represent the Portfolio in any way or otherwise be deemed an agent of the
Portfolio.
10. This Agreement may be amended by mutual consent, but the consent of the
Portfolio must be approved (a) by vote of a majority of those Trustees of the
Portfolio 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
amendment, and (b) by "vote of a majority of the outstanding voting securities"
of the Portfolio.
11. As used in this Agreement, the terms "assignment", "interested
persons" and "vote of a majority of the outstanding voting securities" shall
have the meanings assigned to them respectively in the 1940 Act.
12. Notices of any kind to be given to the Manager by the Portfolio shall
be in writing and shall be duly given if mailed or delivered to the Manager at
00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Treasurer, or at such other
address or to such other individual as shall be specified by the Manager to the
Portfolio. Notices of any kind to be given to the Portfolio by the Manager shall
be in writing and shall be duly given if mailed or delivered to the Portfolio at
Dow Xxxxx Islamic Market Index Portfolio, 00 Xxxx Xxxxxx, Xxxxxx, XX 00000, or
at such other address or to such other individual as shall be specified by the
Portfolio to the Manager.
13. This Agreement may be executed in one or more counterparts, each of
which shall be deemed to be an original.
14. This Agreement shall be governed by and construed in accordance
with the laws of the State of New York.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be executed by their officers or Partners designated below on the day and year
first above written.
DOW XXXXX ISLAMIC MARKET INDEX PORTFOLIO
By
XXXXX BROTHERS XXXXXXXX & CO.
By
WS5769
