EXHIBIT 5(A)
INVESTMENT ADVISORY AGREEMENT
INVESTMENT ADVISORY AGREEMENT, dated as of ________________, 1994, by and
between TOUCHSTONE ADVISORS, INC., an Ohio corporation (the "Advisor"), and
SELECT ADVISORS VARIABLE INSURANCE TRUST, a Massachusetts business trust
created pursuant to a Declaration of Trust dated February 7, 1994, as amended
from time to time (the "Trust").
WHEREAS, the Trust is an open-end diversified management investment
company registered under the Investment Company Act of 1940, as amended, (the
"1940 Act"); and
WHEREAS, shares of beneficial in the Trust are divided into separate
series (each, along with any series which may in the future be established, a
"Portfolio"); and
WHEREAS, the Trust desires to avail itself of the services, information,
advice, assistance and facilities of an investment advisor and to have an
investment advisor perform for it various investment advisory and research
services and other management services; and
WHEREAS, the Advisor is an investment Advisor registered under the
Investment Advisers Act of 1940, as amended, and desires to provide
investment advisory services to the Trust;
NOW THEREFORE, in consideration of the terms and conditions hereinafter
set forth, it is agreed as follows:
1. EMPLOYMENT OF THE ADVISOR. The Trust hereby employs the
Advisor to manage the investment and reinvestment of the assets of each
Portfolio subject to the control and direction of the Trust's Board of
Trustees, for the period on the terms hereinafter set forth. The Advisor
hereby accepts such employment and agrees during such period to render the
services and to assume the obligations herein set forth for the compensation
herein provided. The Advisor shall for all purposes herein be deemed to be
independent contractor and shall, except as expressly provided or authorized
(whether herein or otherwise), have no authority to act for or represent the
Trust in any way or otherwise be deemed an agent of the Trust.
2. OBLIGATIONS OF AND SERVICES TO BE PROVIDED BY THE ADVISOR. In
providing the services and assuming the obligations set forth herein, the
Advisor may, at its expense, employ one or more subadvisors for any
Portfolio. Any agreement between the Advisor and a subadvisor shall be
subject to the renewal, termination and amendment provisions of paragraph 10
hereof. The Advisor undertakes to provide the following services and to
assume the following obligations:
a) The Advisor will manage the investment and reinvestment of the
assets of each Portfolio, subject to and in accordance with the
respective investment objectives and policies of each Portfolio
and any directions which the Trust's Board of Trustees may issue
from time to time. In pursuance of the foregoing, the Advisor
may engage separate investment advisors ("Portfolio Advisor(s)")
to make all determinations with respect to the investment of the
assets of each Portfolio, to effect the purchase and sale of
portfolio securities and to take such steps as may be necessary
to implement the same. Such determination and services by each
Portfolio Advisor shall also include determining the manner in
which voting rights, rights to consent to corporate action and
any other rights pertaining to the portfolio securities shall be
exercised. The Advisor shall, and shall cause each Portfolio
Advisor to, render regular reports to the Trust's Board of
Trustees concerning the Trust's and each Portfolio's investment
activities.
b) The Advisor shall, or shall cause the respective Portfolio
Advisor(s) to place orders for the execution of all portfolio
transactions, in the name of the respective Portfolio and in
accordance with the policies with respect thereto set forth in
the Trust's registration statements under the 1940 Act and the
Securities Act of 1933, as such registration statements may be
amended from time to time. In connection with the placement of
orders for the execution of portfolio transactions, the Advisor
shall create and maintain (or cause the Portfolio Advisors to
create and maintain) all necessary brokerage records for each
Portfolio, which records shall comply with all applicable laws,
rules and regulations, including but not limited to records
required by Section 31(a) of the 1940 Act. All records shall be
the property of the Trust and shall be available for inspection
and use by the Securities and Exchange Commission (the "SEC"),
the Trust or any person retained by the Trust. Where applicable,
such records shall be maintained by the Advisor (or Portfolio
Advisor) for the periods and in the places required by Rule 31a-
02 under the 1940 Act.
c. In the event of any reorganization or other change in the
Advisor, its investment principals, supervisors or members of its
investment (or comparable) committee, the Advisor shall give the
Trust's Board of Trustees written notice of such reorganization
or change within a reasonable time (but not later than 30 days)
after such reorganization or change.
d) The Advisor shall bear its expenses of providing services to the
Trust pursuant to this Agreement except such expenses as are
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undertaken by the Trust. In addition, the Advisor shall pay the
salaries and fees, if any, of all Trustees, officers and
employees of the Trust who are affiliated persons, as defined in
Section 2(a)(3) of the 1940 Act, of the Advisor.
e) The Advisor will manage, or will cause the Portfolio Advisors to
manage, the Portfolio Assets and the investment and reinvestment
of such assets so as to comply with the provisions of the 1940
Act and with Subchapter M of the Internal Revenue Code of 1986,
as amended.
3. EXPENSES. The Trust shall pay the expenses of its operation,
including but not limited to (i) charges and expenses for Trust accounting,
pricing and appraisal services and related overhead, (ii) the charges and
expenses of the Portfolio's auditor's; (iii) the charges and expenses of any
custodian, transfer agent, plan agent, dividend disbursing agent and
registrar appointed by the Trust with respect to the Portfolios; (iv)
brokers' commissions, and issue and transfer taxes, chargeable to the Trust
in connection with securities transactions to which the Trust is a party; (v)
insurance premiums, interest charges, dues and fees for Trust membership in
trade associations and all taxes and fees payable by the Trust to federal,
state or other governmental agencies; (vi) fees and expenses involved in
registering and maintaining registrations of the Trust and/or shares of the
Trust with the SEC, state or blue sky securities agencies and foreign
countries, including the preparation of Prospectuses and Statements of
Additional Information for filing with the SEC; (vii) all expenses of
meetings of Trustees and of shareholders of the Trust and of preparing,
printing and distributing prospectuses, notices, proxy statements and all
reports to shareholders and to governmental agencies; (viii) charges and
expenses of legal counsel to the Trust; (ix) compensation of Trustees of the
Trust; (x) the cost of preparing and printing share certificates; and (xi)
interest on borrowed money, if any.
4. COMPENSATION OF THE ADVISOR.
a) As compensation for the services rendered and obligations assumed
hereunder by the Advisor, the Trust shall pay to the Advisor
monthly a fee that is equal on an annual basis to that percentage
of the average daily net assets of each Portfolio set forth on
Schedule 1 attached hereto (and with respect to any future
Portfolio, such percentage as the Trust and the Advisor may agree
to from time to time). Such fee shall be computed and accrued
daily. If the Advisor serves as investment advisor for less than
the whole of any period specified in this Section 4a, the
compensation to the Advisor shall be prorated. For purposes of
calculating the Advisor's fee, the daily value of each
Portfolio's net assets shall be computed by the same method as
the Trust uses to compute the net asset value of that Portfolio.
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b) The Advisor will pay all fees owing to each Portfolio Advisor,
and the Trust shall not be obligated to the Portfolio Advisors in
any manner with respect to the compensation of such Portfolio
Advisors.
c) The Advisor reserves the right to waive all or a part of its fee.
5. ACTIVITIES OF THE ADVISOR. The services of the Advisor to the
Trust hereunder are not to be deemed exclusive, and the Advisor shall be free
to render similar services to others. It is understood that the Trustees and
officers of the Trust are or may become interested in the Advisor as
stockholders, officers or otherwise, and that stockholders and officers of
the Advisor are or may become similarly interested in the Trust, and that the
Advisor may become interested in the Trust as a shareholder or otherwise.
6. USE OF NAMES. The Trust will not use the name of the Advisor in
any prospectus, sales literature or other material relating to the Trust in
any manner not approved prior thereto by the Advisor; except that the Trust
may use such name in any document which merely refers in accurate terms to
its appointment hereunder or in any situation which is required by the SEC or
a state securities commission; and provided further, that in no event shall
such approval be unreasonably withheld. The Advisor will not use the name of
the Trust in any material relating to the Advisor in any manner not approved
prior thereto by the Trust; except that the Advisor may use such name in any
document which merely refers in accurate terms to the appointment of the
Advisor hereunder or in any situation which is required by the SEC or a state
securities commission. In all other cases, the parties may use such names to
the extent that the use is approved by the party named, it being agreed that
in no event shall such approval be unreasonably withheld.
The Trustees of the Trust acknowledge that, in consideration of the
Advisor's assumption of certain organization expenses of the Trust and of the
various Portfolios, the Advisor has reserved for itself the rights to the
name "Select Advisors Variable Insurance Trust (or any similar names) and
that use by the Trust of such name shall continue only with the continuing
consent of the Advisor, which consent may be withdrawn at any time, effective
immediately, upon written notice thereof to the Trust.
7. LIMITATION OF LIABILITY OF THE ADVISOR.
a. Absent willful misfeasance, bad faith, gross negligence, or
reckless disregard of obligations or duties hereunder on the part of the
Advisor, the Advisor shall not be subject to liability to the Trust or to
any holder of an interest in any Portfolio for any act or omission in the
course of, or connected with, rendering services hereunder or for any
losses that may be sustained in the purchase, holding or sale of any
security. As used in this Section 7, the term "Advisor" shall include
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Touchstone Advisors, Inc. and/or any of its affiliates and the directors,
officers and employees of Touchstone Advisors, Inc. and/or of its
affiliates.
b. The Trust will indemnify the Advisor against, and hold it
harmless from, any and all losses, claims, damages, liabilities or expenses
(including reasonable counsel fees and expenses) resulting from acts or
omissions of the Trust. Indemnification shall be made only after: (i) a
final decision on the merits by a court or other body before whom the
proceeding was brought that the Trust was liable for the damages claimed or
(ii) in the absence of such a decision, a reasonable determination based
upon a review of the facts, that the Trust was liable for the damages
claimed, which determination shall be made by either (a) the vote of a
majority of a quorum of Trustees of the Trust who are neither "interested
persons" of the Trust nor parties to the proceeding ("disinterested non-
party Trustees") or (b) an independent legal counsel satisfactory to the
parties hereto, whose determination shall be set forth in a written
opinion. The Advisor shall be entitled to advances from the Trust for
payment of the reasonable expenses incurred by it in connection with the
matter as to which it is seeking indemnification in the manner and to the
fullest extent that would be permissible under the applicable provisions of
the General Corporation Law of Ohio. The Advisor shall provide to the
Trust a written affirmation of its good faith belief that the standard of
conduct necessary for indemnification under such law has been met and a
written undertaking to repay any such advance if it should ultimately be
determined that the standard of conduct has not been met. In addition, at
least one of the following additional conditions shall be met: (a) the
Advisor shall provide security in form and amount acceptable to the Trust
for its undertaking; (b) the Trust is insured against losses arising by
reason of the advance; or (c) a majority of a quorum of the Trustees of the
Trust, the members of which majority are disinterested non-party Trustees,
or independent legal counsel in a written opinion, shall have determined,
based on a review of facts readily available to the Trust at the time the
advance is proposed to be made, that there is reason to believe that the
Advisor will ultimately be found to be entitled to indemnification.
8. LIMITATION OF TRUST'S LIABILITY. The Advisor acknowledges that it
has received notice of and accepts the limitations upon the Trust's liability
set forth in its Declaration of Trust. The Advisor agrees that the Trust's
obligations hereunder in any case shall be limited to the Trust and to its
assets and that the Advisor shall not seek satisfaction of any such obligation
from the holders of the interests in any Portfolio nor from any Trustee,
officer, employee or agent of the Trust.
9. FORCE MAJEURE. The Advisor shall not be liable for delays or errors
occurring by reason of circumstances beyond its control, including but not
limited to acts of civil or military authority, national emergencies, work
stoppages, fire, flood, catastrophe, acts of God, insurrection, war, riot, or
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failure of communication or power supply. In the event of equipment
breakdowns beyond its control, the Advisor shall take reasonable steps to
minimize service interruptions but shall have no liability with respect
thereto.
10. RENEWAL, TERMINATION AND AMENDMENT.
a) This Agreement shall continue in effect, unless sooner terminated
as hereinafter provided, for a period of twelve months from the
date hereof and it shall continue indefinitely thereafter as to
each Portfolio, provided that such continuance is specifically
approved by the parties hereto and, in addition, at least
annually by (i) the vote of holders of a majority of the
outstanding voting securities of the affected Portfolio or by
vote of a majority of the Trust's Board of Trustees and (ii) by
the vote of a majority of the Trustees who are not parties to
this Agreement or interested persons of the Advisor, cast in
person at a meeting called for the purpose of voting on such
approval.
b) This Agreement may be terminated at any time, with respect to any
Portfolio(s), without payment of any penalty, by the Trust's
Board of Trustees or by a vote of the majority of the outstanding
voting securities of the affected Portfolio(s) upon 60 days'
prior written notice to the Advisor and by the Advisor upon 60
days' prior written notice to the Trust.
c) This Agreement may be amended at any time by the parties hereto,
subject to approval by the Trust's Board of Trustees and, if
required by applicable SEC rules and regulations, a vote of the
majority of the outstanding voting securities of any Portfolio
affected by such change. This Agreement shall terminate
automatically in the event of its assignment.
d) The terms "assignment," "interested persons" and "majority of the
outstanding voting securities" shall have the meaning set forth
for such terms in the 1940 Act.
11. SEVERABILITY. If any provision of this Agreement shall be held or
made invalid by a court decision, statute, rule or otherwise, the remainder of
this Agreement shall not be affected thereby.
12. MISCELLANEOUS. Each party agrees to perform such further actions and
execute such further documents as are necessary to effectuate the purposes
hereof. This Agreement shall be construed and enforced in accordance with and
governed by the laws of the State of Ohio. The captions, in this Agreement are
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included for convenience only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered inn their names and on their behalf by the undersigned,
thereunto duly authorized, all as of the day and year first above written.
Pursuant to the Trust's Declaration of Trust, dated as of February 7, 1994, the
obligations of this Agreement are not binding upon any of the Trustees or
shareholders of the Trust individually, but bind only the Trust estate.
SELECT ADVISORS VARIABLE INSURANCE
TRUST
By ________________________________
Xxxxxx X. Xxxxxxx, Xx., President
Attest:
___________________________
TOUCHSTONE ADVISORS, INC.
By ________________________________
Xxxx X. XxXxxxxx, Vice President
Attest:
___________________________
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AMENDMENT NO. 1
TO
INVESTMENT ADVISORY AGREEMENT
This Amendment No. 1 to Investment Advisory Agreement is dated as of May
1, 1997 and amends the Investment Advisory Agreement (the "Advisory
Agreement") dated September 9, 1994 made by and between Touchstone Advisors,
Inc., an Ohio corporation (the "Advisor"), and Select Advisors Variable
Insurance Trust, a Massachusetts business trust created pursuant to a
Declaration of Trust dated ___________, 1994 (the "Trust").
WHEREAS, the Advisor acts as investment advisor to the Trust pursuant to
the Advisory Agreement; and in such capacity the Advisor has engaged separate
portfolio advisors for each of the Trust's portfolios; and
WHEREAS, the Trust, by its Board of Trustees, has taken action to
terminate, effective as of the close of business on April 30, 1997, Portfolio
Advisory Agreements presently in effect between the Advisor and Harbor
Capital Management Company, Inc. ("Harbor Capital") and Xxxxxx Xxxxxxxx
Capital Management, Inc. ("Xxxxxx Xxxxxxxx") with respect to the Trust's
Balanced Portfolio, each such Portfolio Advisory Agreement being dated as of
September 9, 1994; and
WHEREAS, such Board of Trustees also has taken action to enter into a
Portfolio Advisory Agreement with Op Cap Advisors, a subsidiary of
Xxxxxxxxxxx Capital, a registered investment advisor, under which Op Cap
Advisors will act as Portfolio Advisor to the Trust's Balanced Portfolio,
replacing Harbor Capital and Xxxxxx Xxxxxxxx; and
WHEREAS, the advisory fees to be paid to Op Cap Advisors under such
Portfolio Advisory Agreement will be higher than the fees currently being
paid to Harbor Capital and Xxxxxx Xxxxxxxx under their Portfolio Advisor
Agreements; and
WHEREAS, the trust is agreeable to an increase in the fees being paid
under the Advisory Agreement sufficient to offset the increase in fees to be
paid to Op Cap Advisors, having found that such increased fees are comparable
to the average fees being paid to advisors of balanced portfolios generally.
NOW, THEREFORE, Schedule 1 to the Advisory Agreement is hereby amended,
effective as of the close of business on April 30, 1997, to read as set forth
in Exhibit A to this Amendment, the sole change in such Schedule being an
increase in the advisory fees to be paid by the Balanced Portfolio, from
0.70% to 0.80% of average daily net assets.
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IN WITNESS WHEREOF, the parties have caused this Amendment to be executed
and delivered in their names and on their behalf as of the day and year first
above written.
SELECT ADVISORS VARIABLE INSURANCE TRUST
By:_________________________________
Xxxxxx X. Xxxxxxx, Xx., President
TOUCHSTONE ADVISORS INC.
By:____________________________________
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Exhibit A to Amendment No. 1
to Advisory Agreement
SCHEDULE 1
Emerging Growth Portfolio 0.80%
International Equity Portfolio 0.95%
Balanced Portfolio 0.80%
Income Opportunity 0.65%
Standby Income 0.25%
0121053.03
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