EXHIBIT 5(a)
RREEF SECURITIES FUND, INC.
INVESTMENT ADVISORY AGREEMENT
March 17, 1995
RREEF Real Estate Securities
Advisers, L.P.
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Dear Sirs:
We herewith confirm our agreement with you as follows:
1. We desire to employ you to invest and reinvest the capital of RREEF
Securities Fund, Inc. (the "Company") in securities of the type and in
accordance with the limitations specified from time to time in the registration
statement under the Securities Act of 1933 and the Investment Company Act of
1940 (the "1940 Act"), of which we enclose a copy. You shall for all purposes
herein be deemed an independent contractor, and shall, unless otherwise
expressly provided for or authorized, have no authority to act or represent us.
2. In this connection it is understood that you will from time to time
employ or associate with yourselves such person or persons as you may believe to
be particularly fitted to assist you in the execution of this Agreement, it
being understood that the compensation of such person or persons shall be paid
by you and that no obligation may be incurred on our behalf in any such respect.
This does not apply to such individuals as we may in due course elect as
officers of our corporation, except that no officer, director, stockholder,
partner or employee of your firm or of your firm's general partner shall receive
compensation from us for acting as director, officer or employee of our
corporation, and you agree to pay the compensation of all such persons. We
understand that, during the continuance of this agreement, officers of your firm
will, if elected, serve as directors of our corporation and as its principal
officers.
3. You are to have complete and exclusive authority to develop and
handle for us any business of the type above mentioned which you may consider
advantageous for us, subject to the direction and control of our officers and
directors. You will furnish us with such statistical information with respect to
the securities which we may hold or contemplate purchasing as we may request. We
wish to be kept in touch with important developments affecting our Company and
shall expect you on your own initiative to furnish us from time to time with
such information as you may believe appropriate for this purpose, whether
concerning the individual companies whose securities are included
in our portfolio or the industries in which they are engaged. We shall also
expect you of your own motion to advise us whenever in your opinion conditions
are such as to make it desirable that a specific security be eliminated from our
portfolio.
4. We shall expect of you your best judgment in rendering these
services to us, and we agree as an inducement to your undertaking the same that
you shall not be liable hereunder for any mistake of judgment or in any other
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.
5. In consideration of such services, we shall pay you a monthly fee as
of the last day of each month in each year based upon the average daily value of
net assets during a month for which the monthly fee is calculated, for the
respective Funds set forth in one or more written addenda to this Agreement
executed by both parties. Provided, however, that such fee for any period which
shall not be a full monthly period shall be prorated according to the proportion
which such period bears to the full month and no payment of any fee shall be
made before the commencement of the public offering of any common stock. For
this purpose, the value of our net assets shall be computed in the same manner
as the value of such net assets are computed in connection with the
determination of the net asset value of our shares.
6. Except as otherwise provided below in this paragraph, you will
attend to, or arrange for the performance, at your expense, of such clerical and
accounting work related to the investment and reinvestment of our capital for us
as we may specify, and shall provide office space, facilities and business
equipment therefor. We shall, however, bear all costs and expenses of or
attendant upon: (i) preparation of our federal, state and local tax returns;
(ii) preparation and filing of reports and documents we must file with the
Securities and Exchange Commission; (iii) calculation of net asset value; (iv)
determination of the status and payment of dividends; (v) reconciling and
reviewing output of our custodian bank, determining the adequacy of various
accruals, approving our expenses, authorizing our bank to receive and disburse
money and securities and verifications related thereto, and interfacing with our
auditors; (vi) verification of our security ledger and preparation and
maintenance of other corporate books and records; (vii) brokerage commissions
and other transaction expenses; (viii) stockholders' and Directors' meetings;
(ix) corporate reports and proxy materials, including their preparation,
printing and distribution (but not including the expense of printing and mailing
prospectuses and sales materials used for promotional purposes); (x) fees of
Directors not affiliated with you or any other firm acting as an investment
adviser to us; (xi) taxes and interest expenses; (xii) reports to government
authorities including all expenses and costs relating to such reports and to
state securities law compliance; (xiii) custodian and transfer agent fees; (xiv)
association membership dues; (xv) premiums on all insurance and bonds maintained
for us or on our behalf; (xvi) retention of the transfer agent and registrar for
our shares and the disbursing agent for our stockholders, including costs and
expenses attendant upon shareholder servicing, purchase, repurchase and
redemption of our shares; (xvii) our counsel; and (xviii) our independent
auditors. We may arrange for you or for another party or parties to provide some
or all of the services relating to items (i) to (xvii)above, and any other
services not directly relating to investment and reinvestment of our capital,
upon such terms and conditions, including compensation, as we may agree and
subject to the approval and review of our Board of Directors.
7. You are authorized to place purchase and sale orders for our
portfolio transactions with brokers and/or dealers subject to the supervision of
the Board of Directors and in accordance with the limitations set forth in the
Registration Statement for our shares then in effect.
8. You may act as investment adviser for any other person, firm or
corporation. We recognize that you have given us the right to use the name
"RREEF" and "RREEF Real Estate Securities" in our corporate title, which were
names previously established by you and your affiliates. If for any reason you
no longer act as our investment adviser, we shall remove the name "RREEF" from
our corporate title upon demand made by you.
9. All of our expenses shall be paid by us except for those you
specifically agree to assume under this Agreement. If the total expenses payable
by us for any fiscal year (inclusive of all fees payable under this agreement
but exclusive of interest, taxes, brokerage fees and payments under any Rule
12b-1 distribution plan) shall exceed the most restrictive applicable expense
limitation, if any, prescribed by any statute or regulatory authority of any
jurisdiction in which our shares are qualified for offer and sale, you will pay
or refund to us the amount by which such expenses exceed the amount so computed.
10. This Agreement shall become effective for an initial period through
February 28, 1997, and shall continue in full force and effect continuously
thereafter, if its continuance is approved at least annually as required by the
1940 Act. The effective date of this Agreement shall be the later of (i) the
effective date of the initial registration statement covering the offer and sale
of our shares under the Securities Act of 1933, or (ii) the date this Agreement
has been approved as required by the 1940 Act. This Agreement may be terminated
at any time, without the payment of any penalty, by our Board of Directors or by
vote of a majority of our outstanding voting securities (as defined in the 1940
Act) on 60 days' written notice to you, or by you on 60 days' written notice to
us, and it shall be automatically terminated in the event of its assignment (as
defined in said Act).
11. As of the date of this Agreement, the Company has only one series
of shares (the "RREEF Real Estate Securities Fund") and this Agreement shall
apply to that series. This Agreement shall apply to and be effective as to any
series hereafter created by the Board of Directors for which this Agreement has
been approved in the manner required by the 1940 Act, provided that there is a
written addendum to this Agreement executed by both parties which identifies
such series as a Fund to be managed pursuant to this Agreement, specifies the
fees payable to the Adviser with respect to such series
(which may be different than the fee paid with respect to any other series), and
states the initial effective and termination dates of this Agreement with
respect to each series.
If the foregoing is in accordance with your understanding, will you so
kindly indicate by signing and returning to us the enclosed copy hereof.
Very truly yours,
RREEF SECURITIES FUND, INC.
By: /s/ Xxx X. Xxxxxxx
Its: President
Accepted as of the day
and year first above written.
RREEF REAL ESTATE SECURITIES ADVISERS, L.P.
By: RREEF REAL ESTATE SECURITIES, INC., General Partner
By: /s/ Xxx X. Xxxxxxx
Its: President
ADDENDUM TO INVESTMENT ADVISORY AGREEMENT
DATED MARCH 17, 0000 XXXXXXX
XXXXX XXXX XXXXXX SECURITIES ADVISERS, L.P.
AND RREEF SECURITIES FUND, INC.
RREEF Real Estate Securities Advisers, L.P. (the "Adviser") shall be
the investment adviser for the series of RREEF Securities Fund, Inc. (the
"Company") designated RREEF Real Estate Securities Fund (the "Fund") pursuant to
the Investment Advisory Agreement between the Adviser and the Company dated
March 17, 1995 with an initial effective date of July 27, 1995 and an initial
term ending February 28, 1997 unless sooner terminated as provided in the
Agreement. The compensation payable out of the assets of the Fund pursuant to
Section 5 of the Agreement shall be at the following monthly rates:
VALUE OF AVERAGE
DAILY NET ASSETS
1/12 of .75% of ....................... First $100 Million
1/12 of .65% of ....................... Amounts In Excess of $100 Million
RREEF SECURITIES FUND, INC.
By: /s/ Xxx X. Xxxxxxx
Its: President
RREEF REAL ESTATE SECURITIES ADVISERS, L.P.
By: RREEF REAL ESTATE SECURITIES, INC., General Partner
By: /s/ Xxx X. Xxxxxxx
Its: President
