EX-99.d.1.
INVESTMENT ADVISORY AGREEMENT
THIS AGREEMENT is made and entered into as of the ____ day of _________,
200_ by and between ABERDEEN FUNDS (the "Trust"), a Delaware statutory trust,
and ABERDEEN ASSET MANAGEMENT INC. (the "Adviser"), a Delaware corporation
registered under the Investment Advisers Act of 1940, as amended (the "Advisers
Act").
W I T N E S S E T H :
WHEREAS, the Trust is registered with the Securities and Exchange
Commission (the "SEC") as an open-end management investment company under the
Investment Company Act of 1940, as amended (the "1940 Act");
WHEREAS, the Trust desires to retain the Adviser to furnish certain
investment advisory services, as described herein, with respect to certain of
the series of the Trust, all as now are or may be hereafter listed on Exhibit A
to this Agreement (each, a "Fund"); and
WHEREAS, the Adviser represents that it is willing and possesses legal
authority to render such services subject to the terms and conditions set forth
in this Agreement,
NOW, THEREFORE, the Trust and the Adviser do mutually agree and promise as
follows:
1. Appointment as Adviser. The Trust hereby appoints the Adviser to act as
investment adviser to each Fund subject to the terms and conditions set
forth in this Agreement. The Adviser hereby accepts such appointment and
agrees to furnish the services hereinafter described for the compensation
provided for in this Agreement.
2. Duties of Adviser.
a. Investment Management Services.
(i) Subject to the supervision of the Trust's Board of Trustees (and
except as otherwise permitted under the terms of any exemptive
relief obtained by the Adviser from the SEC, or by rule or
regulation), the Adviser will provide, or arrange for the
provision of, a continuous investment program and overall
investment strategies for each Fund, including investment
research and management with respect to all securities and
investments and cash equivalents in each Fund. The Adviser will
determine, or arrange for others to determine, from time to time
what securities and other investments will be purchased, retained
or sold by each Fund and will implement, or arrange for others to
implement, such determinations through the placement, in the name
of a Fund, of orders for the execution of portfolio transactions
with or through such brokers or dealers as may be so selected.
The Adviser will provide, or arrange for the provision of, the
services under this Agreement in accordance with the stated
investment policies and restrictions of each Fund as set forth in
that Fund's current prospectus and statement of additional
information as currently in effect and as supplemented or amended
from time to time (collectively referred to hereinafter as the
"Prospectus") and subject to the directions of the Trust's Board
of Trustees. With respect to foreign securities, at its own
expense, the Adviser may obtain statistical and other factual
information and advice regarding economic factors and trends from
its foreign subsidiaries, and may obtain investment services from
the investment advisory personnel of its affiliates located
throughout the world to the extent permitted under
interpretations of the federal securities laws.
(ii) Subject to the provisions of this Agreement and the 1940 Act and
any exemptions thereto, the Adviser is authorized to appoint one
or more qualified subadvisers (each a "Subadviser") to provide
each Fund with certain services required by this Agreement. Each
Subadviser shall have such investment discretion and shall make
all determinations with respect to the investment of a Fund's
assets as shall be assigned to that Subadviser by the Adviser and
the purchase and sale of portfolio securities with respect to
those assets and shall take such steps as may be necessary to
implement its decisions. The Adviser shall not be responsible or
liable for the investment merits of any decision by a Subadviser
to purchase, hold, or sell a security for a Fund.
(iii) Subject to the supervision and direction of the Trustees, the
Adviser shall (i) have overall supervisory responsibility for the
general management and investment of a Fund's assets; (ii)
determine the allocation of assets among the Subadvisers, if any;
and (iii) have full investment discretion to make all
determinations with respect to the investment of Fund assets not
otherwise assigned to a Subadviser.
(iv) The Adviser shall research and evaluate each Subadviser, if any,
including (i) performing initial due diligence on prospective
Subadvisers and monitoring each Subadviser's ongoing performance;
(ii) communicating performance expectations and evaluations to
the Subadvisers; and (iii) recommending to the Trust's Board of
Trustees whether a Subadviser's contract should be renewed,
modified or terminated. The Adviser shall also recommend changes
or additions to the Subadvisers and shall compensate the
Subadvisers.
(v) The Adviser shall provide to the Trust's Board of Trustees such
periodic reports concerning a Fund's business and investments as
the Board of Trustees shall reasonably request.
b. Compliance with Applicable Laws and Governing Documents. In the
performance of its duties and obligations under this Agreement, the
Adviser shall act in conformity with the Trust's Agreement and
Declaration of Trust, as from time to time amended and/or restated,
and By-Laws, as from time to time amended and/or restated, and the
Prospectus and with the instructions and directions received from the
Trustees of the Trust and will conform to and comply with the
requirements of the 1940 Act, the Internal Revenue Code of 1986, as
amended (the "Code") (including the requirements for qualification as
a regulated investment company) and all other applicable federal and
state laws and regulations.
The Adviser acknowledges and agrees that subject to the supervision
and directions of the Trust's Board of Trustees, it shall be solely
responsible for compliance with all disclosure requirements under all
applicable federal and state laws and regulations relating to the
Trust or a Fund, including, without limitation, the 1940 Act, and the
rules and regulations thereunder, except that each Subadviser shall
have liability in connection with information furnished by the
Subadviser to a Fund or to the Adviser.
c. Consistent Standards. It is recognized that the Adviser will perform
various investment management and administrative services for entities
other than the Trust and the Funds; in connection with providing such
services, the Adviser agrees to exercise the same skill and care in
performing its services under this Agreement as the Adviser exercises
in performing similar services with respect to the other fiduciary
accounts for which the Adviser has investment responsibilities.
d. Brokerage. The Adviser is authorized, subject to the supervision of
the Trust's Board of Trustees, (1) to establish and maintain accounts
on behalf of each Fund with, and to place orders for the purchase and
sale of assets not allocated to a Subadviser, with or through, such
persons, brokers or dealers ("brokers") as the Adviser may select, and
(2) to negotiate commissions to be paid on such transactions. In the
selection of such brokers and the placing of such orders, the Adviser
shall seek to obtain for a Fund the most favorable price and execution
available, except to the extent the Adviser may be permitted to pay
higher brokerage commissions for brokerage and research services, as
provided below. In using its reasonable efforts to obtain for a Fund
the most favorable price and execution available, the Adviser, bearing
in mind the Fund's best interests at all times, shall consider all
factors it deems relevant, including price, the size of the
transaction, the nature of the market for the security, the amount of
the commission, if any, the timing of the transaction, market prices
and trends, the reputation, experience and financial stability of the
broker involved, and the quality of service rendered by the broker in
other transactions. Subject to such policies as the Trustees may
determine, the Adviser shall not be deemed to have acted unlawfully or
to have breached any duty created by this Agreement or otherwise
solely by reason of its having caused a Fund to pay a broker that
provides brokerage and research services (within the meaning of
Section 28(e) of the Securities Exchange Act of 1934, as amended) to
the Adviser an amount of commission for effecting a Fund's investment
transaction that is in excess of the amount of commission that another
broker would have charged for effecting that transaction, if, but only
if, the Adviser determines in good faith that such commission was
reasonable in relation to the value of the brokerage and research
services provided by such broker or dealer, viewed in terms of either
that particular transaction or the overall responsibilities of the
Adviser with respect to the accounts as to which it exercises
investment discretion.
It is recognized that the services provided by such brokers may be
useful to the Adviser in connection with the Adviser's services to
other clients. On occasions when the Adviser deems the purchase or
sale of a security to be in the best interests of a Fund as well as
other clients of the Adviser, the Adviser, to the extent permitted by
applicable laws and regulations, may, but shall be under no obligation
to, aggregate the securities to be sold or purchased in order to
obtain the most favorable price or lower brokerage commissions and
efficient execution. In such event, allocation of securities so sold
or purchased, as well as the expenses incurred in the transaction,
will be made by the Adviser in the manner the Adviser considers to be
the most equitable and consistent with its fiduciary obligations to
each Fund and to such other clients.
e. Securities Transactions. The Adviser will not purchase securities or
other instruments from or sell securities or other instruments to a
Fund; provided, however, the Adviser may purchase securities or other
instruments from or sell securities or other instruments to a Fund if
such transaction is permissible under applicable laws and regulations,
including, without limitation, the 1940 Act, the Advisers Act and the
rules and regulations promulgated thereunder or any exemption
therefrom.
The Adviser agrees to observe and comply with Rule 17j-1 under the
1940 Act and the Trust's Code of Ethics, as the same may be amended
from time to time.
f. Books and Records. In accordance with the 1940 Act and the rules and
regulations promulgated thereunder, the Adviser shall maintain
separate books and detailed records of all matters pertaining to the
Funds and the Trust (the "Fund's Books and Records"), including,
without limitation, a daily ledger of such assets and liabilities
relating thereto and brokerage and other records of all securities
transactions. The Adviser acknowledges that the Fund's Books and
Records are property of the Trust. In addition, the Fund's Books and
Records shall be available to the Trust at any time upon request and
shall be available for telecopying without delay to the Trust during
any day that the Funds are open for business.
3. Expenses. During the term of this Agreement, the Adviser will pay all
expenses incurred by it in connection with its activities under this
Agreement other than the cost of securities, commodities and other
investments (including brokerage commissions and other transaction charges,
if any) purchased for a Fund. The Adviser shall, at its sole expense,
employ or associate itself with such persons as it believes to be
particularly fitted to assist it in the execution of its duties under this
Agreement. The Adviser shall be responsible for the expenses and costs for
the officers of the Trust and the Trustees of the Trust who are "interested
persons" (as defined in the 0000 Xxx) of the Adviser.
It is understood that the Trust will pay all of its own expenses,
including, without limitation, (1) all charges and expenses of any
custodian or depository appointed by the Trust for the safekeeping of its
cash, securities and other assets; (2) all charges and expenses paid to an
administrator appointed by the Trust to provide administrative or
compliance services; (3) the charges and expenses of any transfer agents
and registrars appointed by the Trust; (4) the charges and expenses of
independent certified public accountants and of general ledger accounting
and internal reporting services for the Trust; (5) the charges and expenses
of dividend and capital gain distributions; (6) the compensation and
expenses of Trustees of the Trust who are not "interested persons" of the
Adviser; (7) brokerage commissions and issue and transfer taxes chargeable
to the Trust in connection with securities transactions to which the Trust
is a party; (8) all taxes and fees payable by the Trust to Federal, State
or other governmental agencies; (9) the cost of stock certificates
representing shares of the Trust; (10) all expenses of shareholders' and
Trustees' meetings and of preparing, printing and distributing prospectuses
and reports to shareholders; (11) charges and expenses of legal counsel for
the Trust in connection with legal matters relating to the Trust, including
without limitation, legal services rendered in connection with the Trust's
existence, financial structure and relations with its shareholders; (12)
insurance and bonding premiums, (13) association membership dues; (14)
bookkeeping and the costs of calculating the net asset value of shares of
the Trust's Funds; and (15) expenses relating to the issuance, registration
and qualification of the Trust's shares.
4. Compensation. For the services provided and the expenses assumed with
respect to a Fund pursuant to this Agreement, the Adviser will be entitled
to the fee listed for each Fund on Exhibit A. Such fees will be computed
daily and payable monthly at an annual rate based on a Fund's average daily
net assets.
The method of determining net assets of a Fund for purposes hereof shall be
the same as the method of determining net assets for purposes of
establishing the offering and redemption price of the Shares as described
in each Fund's Prospectus. If this Agreement shall be effective for only a
portion of a month, the aforesaid fee shall be prorated for the portion of
such month during which this Agreement is in effect.
Notwithstanding any other provision of this Agreement, the Adviser may from
time to time agree not to impose all or a portion of its fee otherwise
payable hereunder (in advance of the time such fee or portion thereof would
otherwise accrue). Any such fee reduction may be discontinued or modified
by the Adviser at any time.
5. Representations and Warranties of Adviser. The Adviser represents and
warrants to the Trust as follows:
The Adviser is registered as an investment adviser under the Advisers Act;
The Adviser is a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware with the power to own and
possess its assets and carry on its business as it is now being conducted;
The execution, delivery and performance by the Adviser of this Agreement
are within the Adviser's powers and have been duly authorized by all
necessary action on the part of its shareholders and/or directors, and no
action by or in respect of, or filing with, any governmental body, agency
or official is required on the part of the Adviser for the execution,
delivery and performance by the Adviser of this Agreement, and the
execution, delivery and performance by the Adviser of this Agreement do not
contravene or constitute a default under (i) any provision of applicable
law, rule or regulation; (ii) the Adviser's governing instruments; or (iii)
any agreement, judgment, injunction, order, decree or other instrument
binding upon the Adviser; and
The Form ADV of the Adviser provided to the Trust is a true and complete
copy of the form, including that part or parts of the Form ADV filed with
the SEC, that part or parts maintained in the records of the Adviser,
and/or that part or parts provided or offered to clients, in each case as
required under the Advisers Act and rules thereunder, and the information
contained in such Form ADV is accurate and complete in all material
respects and does not omit to state any material fact necessary in order to
make the statements made, in light of the circumstances under which they
were made, not misleading.
6. Survival of Representations and Warranties; Duty to Update Information. All
representations and warranties made by the Adviser pursuant to Section 5
shall survive for the duration of this Agreement and the parties hereto
shall promptly notify each other in writing upon becoming aware that any of
the foregoing representations and warranties are no longer true.
7. Liability and Indemnification.
a. Liability. In the absence of willful misfeasance, bad faith or gross
negligence on the part of the Adviser or a reckless disregard of its
duties hereunder, the Adviser shall not be subject to any liability to
a Fund or the Trust, for any act or omission in the case of, or
connected with, rendering services hereunder or for any losses that
may be sustained in the purchase, holding or sale of Fund assets;
provided, however, that nothing herein shall relieve the Adviser from
any of its obligations under applicable law, including, without
limitation, the federal and state securities laws.
b. Indemnification. The Adviser shall indemnify the Trust and its
officers and trustees, for any liability and expenses, including
attorneys' fees, which may be sustained as a result of the Adviser's
willful misfeasance, bad faith, gross negligence, reckless disregard
of its duties hereunder or violation of applicable law, including,
without limitation, the federal and state securities laws.
8. Duration and Termination.
a. Duration. Unless sooner terminated, this Agreement shall continue
until ________, 200_ with respect to any Fund covered by this
Agreement initially and for any Fund subsequently added to this
Agreement, an initial period of no more than two years, and thereafter
shall continue automatically for successive annual periods with
respect to each of the Funds; provided that such continuance is
specifically approved at least annually by the Trust's Board of
Trustees or the vote of the lesser of (a) 67% of the shares of a Fund
represented at a meeting if holders of more than 50% of the
outstanding shares of the Fund are present in person or by proxy, or
(b) more than 50% of the outstanding shares of the Fund; provided
further that in either event its continuance also is approved by a
majority of the Trust's Trustees who are not "interested persons" (as
defined in the 0000 Xxx) of any party to this Agreement, by vote cast
in person at a meeting called for the purpose of voting on such
approval.
b. Termination. Notwithstanding whatever may be provided herein to the
contrary, this Agreement may be terminated at any time, without
payment of any penalty by vote of a majority of the Trust's Board of
Trustees, or, with respect to a Fund, by "vote of a majority of the
outstanding voting securities" (as defined in the 0000 Xxx) of that
Fund, or by the Adviser, in each case, upon not less than sixty (60)
days' written notice to the other party.
This Agreement shall not be assigned (as such term is defined in the
0000 Xxx) and shall terminate automatically in the event of its
assignment.
9. Services Not Exclusive. The services furnished by the Adviser hereunder are
not to be deemed exclusive, and the Adviser shall be free to furnish
similar services to others so long as its services under this Agreement are
not impaired thereby. It is understood that the action taken by the Adviser
under this Agreement may differ from the advice given or the timing or
nature of action taken with respect to other clients of the Adviser, and
that a transaction in a specific security may not be accomplished for all
clients of the Adviser at the same time or at the same price.
10. Amendment. This Agreement may be amended by mutual consent of the parties,
provided that the terms of each such amendment shall be in writing and
approved by the Trust's Board of Trustees or by a vote of a majority of the
outstanding voting securities of a Fund (as required by the 1940 Act).
11. Confidentiality. Subject to the duties of the Adviser and the Trust to
comply with applicable law, including any demand of any regulatory or
taxing authority having jurisdiction, the parties hereto shall treat as
confidential all information pertaining to a Fund and the Trust and the
actions of the Adviser and the Funds in respect thereof.
12. Jurisdiction. This Agreement shall be governed by and construed to be in
accordance with substantive laws of the State of Delaware without reference
to choice of law principles thereof and in accordance with the 1940 Act. In
the case of any conflict, the 1940 Act shall control.
13. Counterparts. This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original, and all of which shall together
constitute one and the same instrument.
14. Certain Definitions. For the purposes of this Agreement, "interested
person," "affiliated person," "assignment" shall have their respective
meanings as set forth in the 1940 Act, subject, however, to such exemptions
as may be granted by the SEC.
15. Captions. The captions herein are included for convenience of reference
only and shall be ignored in the construction or interpretation hereof.
16. Severability. If any provision of this Agreement shall be held or made
invalid by a court decision or applicable law, the remainder of the
Agreement shall not be affected adversely and shall remain in full force
and effect.
17. Aberdeen Funds and its Trustees. The terms "Aberdeen Funds" and the
"Trustees of Aberdeen Funds" refer respectively to the Trust created and
the Trustees, as trustees but not individually or personally, acting from
time to time under an Agreement and Declaration of Trust made and dated as
of _______________, as has been or may be amended and/or restated from time
to time, and to which reference is hereby made.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
day and year first written above.
ADVISER:
ABERDEEN ASSET MANAGEMENT INC.
By:
Name:
Title:
TRUST:
ABERDEEN FUNDS
By:
Name
Title:
EXHIBIT A
INVESTMENT ADVISORY AGREEMENT
BETWEEN
ABERDEEN ASSET MANAGEMENT INC. AND ABERDEEN FUNDS
EFFECTIVE AS OF ______________, ____
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Fund Assets Investment Advisory Fee
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Aberdeen Select Mid Cap Growth Fund $0 up to $250 million 0.80%
$250 million up to $1 billion 0.77%
$1 billion up to $2 billion 0.74%
$2 billion up to $5 billion 0.71%
$5 billion and more 0.68%
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Aberdeen Tax-Free Income Fund $0 up to $250 million 0.50%
$250 million up to $1 billion 0.475%
$1 billion up to $2 billion 0.45%
$2 billion up to $5 billion 0.425%
$5 billion and more 0.40%
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Aberdeen Small Cap Fund up to $100 million 0.95%
$100 million or more 0.80%
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Aberdeen Select Small Cap Fund All Assets 0.95%
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Aberdeen Natural Resources Fund $0 up to $500 million 0.70%
$500 million up to $2 billion 0.65%
$2 billion and more 0.60%
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Aberdeen Technology and $0 up to $500 million 0.88%
Communications Fund $500 million up to $2 billion 0.83%
$2 billion and more 0.78%
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Aberdeen Health Sciences Fund $0 up to $500 million 0.90%
$500 million up to $2 billion 0.85%
$2 billion and more 0.80%
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Aberdeen Select Growth Fund $0 up to $500 million 0.90%
$500 million up to $2 billion 0.80%
$2 billion and more 0.75%
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Aberdeen Select Equity Fund $0 up to $500 million 0.80%
$500 million up to $2 billion 0.70%
$2 billion and more 0.65%
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Aberdeen Equity Long-Short Fund $0 up to $250 million 1.50%
$250 million and more 1.25%
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Aberdeen China Opportunities Fund $0 up to $500 million 1.25%
$500 million up to $2 billion 1.20%
$2 billion and more 1.15%
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Aberdeen Optimal Allocations Funds: All Assets 0.15%
Growth Fund
Moderate Growth Fund
Moderate Fund
Specialty Fund
Defensive Fund
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Aberdeen Developing Markets Fund $0 up to $500 million 1.05%
$500 million up to $2 billion 1.00%
$2 billion and more 0.95%
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Aberdeen International Equity Fund $0 up to $500 million 0.90%
$500 million up to $2 billion 0.85%
$2 billion and more 0.80%
---------------------------------------- -----------------------------------------------------------------
Aberdeen Select Worldwide Fund $0 up to $500 million 0.90%
$500 million up to $2 billion 0.85%
$2 billion and more 0.80%
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Aberdeen Global Financial Services Fund $0 up to $500 million 0.90%
$500 million up to $2 billion 0.85%
$2 billion and more 0.80%
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Aberdeen Global Utilities Fund $0 up to $500 million 0.70%
$500 million up to $2 billion 0.65%
$2 billion and more 0.60%
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Aberdeen Hedged Core Equity Fund All Assets 1.25%
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Aberdeen Small Cap Opportunities Fund $0 up to $500 million 0.85%
$500 million up to $2 billion 0.75%
$2 billion and more 0.70%
---------------------------------------- -----------------------------------------------------------------
Aberdeen Market Neutral Fund All Assets 1.25%
---------------------------------------- -----------------------------------------------------------------
Aberdeen Small Cap Growth Fund $0 up to $500 million 0.95%
$500 million up to $2 billion 0.85%
$2 billion and more 0.80%
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Aberdeen Small Cap Value Fund $0 up to $500 million 0.95%
$500 million up to $2 billion 0.85%
$2 billion and more 0.80%
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