INVESTMENT ADVISORY AND ADMINISTRATIVE SERVICES AGREEMENT
THIS AGREEMENT, made as of this 6th of November, 1996 by and between
LifeUSA Funds, Inc., a Minnesota corporation (the "Fund"), on behalf of each
portfolio represented by a series of shares of common stock of the Fund that
adopts this Agreement (the "Portfolios") (the Portfolios, together with the date
each Portfolio adopts this Agreement, are set forth in Exhibit A hereto, which
shall be updated from time to time to reflect additions, deletions or other
changes thereto), and Investment Advisers, Inc., a corporation organized and
existing under the laws of the State of Delaware (the "Adviser").
1. (a) The Fund on behalf of the Portfolios hereby retains the Adviser, and
the Adviser hereby agrees to act, as investment adviser for, and to manage the
investment of the assets of, the Portfolios as set forth herein and as further
requested by the Board of Directors of the Fund. In acting hereunder the Adviser
shall be an independent contractor and, unless otherwise expressly provided or
authorized hereunder or by the Board of Directors of the Fund, shall have no
authority to act for or represent the Fund or any Portfolio in any way or
otherwise be an agent of the Fund or any Portfolio. The Adviser covenants and
agrees that, in effecting acquisitions and dispositions of specific investments
on behalf of the Portfolios, it shall at all times be governed by a Portfolio's
investment objectives, restrictions and policies as delineated and limited by
the disclosures contained in the various documents filed with the Securities and
Exchange Commission, as such documents may from time to time be amended or
supplemented. The Adviser shall report to the Fund's Board of Directors
regularly at such times and in such detail as the Board may from time to time
determine appropriate, in order to permit the Board to determine its adherence
to the Portfolios' investment objectives, policies and limitations.
(b) The Fund on behalf of the Portfolios hereby engages the Adviser, and
the Adviser hereby agrees, to provide the Portfolios with all dividend
disbursing, accounting, administrative and transfer agency services required by
the Portfolios, including, without limitation, the following services:
(1) The calculation of net asset value per share at such times and in such
manner as specified in the Portfolios' current Prospectus and Statement of
Additional Information and at such other times upon which the parties hereto may
from time to time agree. The pricing services or other sources from which daily
price quotations on portfolio securities are to be obtained for purposes of
calculating a Portfolio's daily net asset value shall be paid for by the Adviser
and approved by the Fund;
(2) Upon the receipt of funds for the purchase of Portfolio shares or the
receipt of redemption requests with respect to Portfolio shares outstanding, the
calculation of the number of shares to be purchased or redeemed, respectively;
(3) Upon a Portfolio's distribution of dividends, (i) the calculation of
the amount of such dividends to be received per Portfolio share, (ii) the
calculation of the number of additional Portfolio shares to be received by each
Portfolio shareholder, other than any shareholder who has elected to receive
such dividends in cash, and (iii) the mailing of payments with respect to such
dividends to shareholders who have elected to receive such dividends in cash;
(4) The provision of transfer agency services as described below:
(i) The Adviser shall make original issues of shares of a Portfolio in
accordance with a Portfolio's current Prospectus and Statement of Additional
Information and with instructions from the Fund;
(ii) Prior to the daily determination of net asset value of the Portfolio,
the Adviser shall process all purchase orders received since the last
determination of a Portfolio's net asset value;
(iii) Transfers of shares shall be registered;
(iv) The Adviser will maintain stock registry records in the usual form in
which it will note the issuance, transfer and redemption of Portfolio shares,
and is also authorized to maintain an account in which it will record a
Portfolio's shares and fractions issued and outstanding from time to time for
which issuance of a Portfolio share certificate is deferred; and
(v) The Adviser will, in addition to the aforementioned duties and
functions, perform the usual duties and functions of a stock transfer agent for
a registered investment company;
(5) The creation and maintenance of such records relating to the business
of a Portfolio as the Fund may from time to time reasonably request;
(6) The preparation of tax forms, reports, notices, proxy statements,
proxies and other Portfolio shareholder communications, and the mailing thereof
to Portfolio shareholders;
(7) The provision of such other dividend disbursing, accounting,
administrative, accounting and transfer agency services upon which the parties
hereto may from time to time agree;
(8) The provision of shareholder services not otherwise the subject of the
preceding paragraphs or of any agreement with the Fund's principal underwriter;
and
(9) The Portfolios hereby authorize the Adviser to contract with qualified
entities for the provision of any of the services to be performed pursuant to
this Section 1(b).
2. The Adviser, at its own expense, shall file all documents with all
relevant regulatory agencies and governmental authorities on the Fund's behalf,
and shall provide the Fund with all necessary office space, personnel and
facilities necessary and incident to the performance of the Adviser's services
hereunder. The Adviser shall pay or be responsible for the payment of all
compensation to personnel of the Fund and the officers and directors of the Fund
who are otherwise affiliated with the Adviser.
3. The Adviser shall be responsible only for those expenses expressly
stated in paragraph 2 to be the responsibility of the Adviser and shall not be
responsible for any other expenses of the Fund or any Portfolio including, as
illustrative and without limitation, fees and charges of any custodian
(including charges as custodian and for keeping books and records and similar
services to the Fund and the Portfolios); fees and expenses of directors, other
than directors described in paragraph 2; fees and expenses of independent
auditors, legal counsel; brokers' commissions; interest charges; taxes and
corporate fees payable to any government or governmental body or agency
(including certain of those incurred on account of the registration or
qualification of securities issued by the Fund); shareholder meetings and
related solicitation costs.
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4. The Adviser may utilize the Fund's distributor or an affiliate of the
Adviser as a broker, including as a principal broker, provided that the
brokerage transactions and procedures are in accordance with Rule 17e-1 under
the Investment Company Act of 1940, as amended (the "Act"), and the then
effective Registration Statement of the Fund under the Securities Act of 1933,
as amended. All allocation of portfolio transactions shall be subject to such
policies and supervision as the Fund's Board of Directors or any committee
thereof deem appropriate and any brokerage policy set forth in the then current
Registration Statement of the Fund.
5. The Adviser shall see that there are rendered to the Board of Directors
of the Fund such periodic and special reports as the Board of Directors may
reasonably request, including any reports in respect to placement of security
transactions for the Portfolios.
6. The Portfolio pays no compensation to the Adviser under this Agreement.
This does not limit the Adviser's ability, however, to seek reimbursement for
its payment of Portfolio expenses. Anything to the contrary notwithstanding, the
Adviser, in its discretion, may at any time and from time to time voluntarily
reimburse Portfolio expenses.
7. Services of the Adviser herein provided are not to be deemed exclusive,
and the Adviser shall be free to render similar services or other services to
others so long as its services hereunder shall not be impaired thereby.
8. The Adviser, in carrying out and performing the terms and conditions of
this Agreement, shall incur no liability for its status hereunder or for any
actions taken or omitted in good faith and without negligence. Without
limitation of the foregoing:
(1) The Adviser may rely upon, and shall not be liable to any person or
party for any actions taken or omitted to be taken in good faith in reliance
upon, the advice of the Fund, or of counsel, who may be counsel for the Fund or
counsel for the Adviser, and upon statements of accountants, brokers and other
persons believed by IAI in good faith to be expert in the matters upon which
they are consulted; and
(2) The Adviser may rely upon, and shall not be liable to any person or
party for any actions taken or omitted to be taken in good faith in reliance
upon, any signature, instruction, request, letter of transmittal, certificate,
opinion of counsel, statement, instrument, report, notice, consent, order or
other paper or document that the Adviser in good faith believes to be genuine
and to have been signed, presented or authorized by the purchaser, Fund or other
proper party or parties.
9. It is understood that the officers, directors, agents and shareholders
of the Fund are or may be interested in the Adviser or the distributor of the
Fund as officers, directors, agents or shareholders and that the officers,
directors, shareholders and agents of the Adviser may be interested in the Fund
otherwise than as shareholders.
10. The effective date of this Agreement with respect to each Portfolio
shall be the date set forth on Exhibit A hereto, which date shall not precede
the date that this Agreement is approved by the vote of the holders of at least
a majority of the outstanding shares of such Portfolio and the vote of the Board
of Directors of the Fund, including the vote of a majority of the directors who
are not parties to this Agreement or "interested persons" (as defined in the
Act) of the Adviser or of the Fund, cast in person at a meeting called for the
purpose of voting on such approval.
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Unless sooner terminated as hereinafter provided, this Agreement shall
continue in effect with respect to each Portfolio for a period of more than two
years from the date of its execution but only as long as such continuance is
specifically approved at least annually by (a) the Board of Directors of the
Fund or by the vote of a majority of the outstanding shares of the applicable
Portfolio and (b) the vote of a majority of the directors, who are not parties
to this Agreement or "interested persons" (as defined in the Act) of the Adviser
or of the Fund, cast in person at a meeting called for the purpose of voting on
such approval.
11. This Agreement may be terminated with respect to any Portfolio at any
time, without the payment of any penalty, by the Board of Directors of the Fund
or by the vote of a majority of the outstanding shares of such Portfolio, or by
the Adviser, upon 60 days' written notice to the other party.
This Agreement shall automatically terminate in the event of its
"assignment" (as defined in the Act), provided, however, that such automatic
termination shall be prevented in a particular case by an order of exemption
from the Securities and Exchange Commission or a no-action letter of the staff
of the Commission to the effect that such assignment does not require
termination as a statutory or regulatory matter.
12. This Agreement may be modified by mutual consent, such consent as to
any Portfolio only to be authorized by a majority of the directors who are not
parties to this Agreement or "interested persons" (as defined in the Act) of the
Adviser or of the Fund and, only with respect to the investment advisory
services to be performed hereunder, the vote of a majority of the outstanding
shares of such Portfolio.
13. Wherever referred to in this Agreement, the vote or approval of the
holders of a majority of the outstanding shares of a Portfolio shall mean the
lesser of (a) the vote of 67% or more of the shares of such Portfolio
represented at a meeting where more than 50% of the outstanding shares are
present in person or by proxy, or (b) the vote of more than 50% of the
outstanding shares of such Portfolio.
14. If any provision of this Agreement shall be held or made invalid by a
court decision, statute, rule or otherwise, the remainder shall not be thereby
affected.
15. Any notice under this Agreement shall be in writing, addressed,
delivered or mailed, postage prepaid, to the other party at such address as such
other party may designate in writing for receipt of such notice.
16. The internal law, and not the law of conflicts, of the State of
Minnesota will govern all questions concerning the construction, validity and
interpretation of this Agreement and the performance of the obligations imposed
by this Agreement.
17. This Agreement, including its exhibits, constitutes the entire
agreement between the parties concerning its subject matter and supersedes all
prior and contemporaneous agreements, representations and understandings of the
parties.
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IN WITNESS WHEREOF, the Fund and the Adviser have caused this Agreement to
be executed by their duly authorized officers as of the day and year first above
written.
LIFEUSA FUNDS, INC.
By /s/ Xxxxxxx X. Xxxxxxxxx
Its President
INVESTMENT ADVISERS, INC.
By /s/ Xxxxxxx X. Xxxxxxxxx
Its Executive Vice President
By /s/ Xxxxxxxxxxx X. Xxxxx
Its Senior Vice President and
General Counsel
LIFEUSA FUNDS, INC.
EXHIBIT A
TO
INVESTMENT ADVISORY AND ADMINISTRATIVE SERVICES AGREEMENT
EFFECTIVE DATES:
Portfolio Effective Date
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LifeUSA Aggressive Growth Portfolio January 1, 1997
LifeUSA Growth Portfolio January 1, 1997
LifeUSA Global Portfolio January 1, 1997
LifeUSA Balanced Portfolio January 1, 1997
LifeUSA Current Income Portfolio January 1, 1997
LifeUSA Principal Preservation Portfolio January 1, 1997
