INVESTMENT ADVISORY AGREEMENT
AGREEMENT made the 14th day of October, 1996, by and between XXXXXXXXXXX
REAL ASSET FUND (hereinafter referred to as the "Fund"), and
OPPENHEIMERFUNDS, INC. (hereinafter referred to as "OFI").
WHEREAS, the Fund is an open-end, non-diversified management investment
company registered as such with the Securities and Exchange Commission
(the "Commission") pursuant to the Investment Company Act of 1940 (the
"Investment Company Act"), and OFI is an investment adviser registered as
such with the Commission under the Investment Advisers Act of 1940;
WHEREAS, the Fund desires that OFI shall act as its investment adviser
pursuant to this Agreement;
NOW, THEREFORE, in consideration of the mutual promises and covenants
hereinafter set forth, it is agreed by and between the parties, as
follows:
1. General Provision.
The Fund hereby employs OFI and OFI hereby undertakes to act as the
investment adviser of the Fund and to perform for the Fund such other
duties and functions as are hereinafter set forth. OFI shall, in all
matters, give to the Fund and its Board of Trustees the benefit of its
best judgment, effort, advice and recommendations and shall, at all times
conform to, and use its best efforts to enable the Fund to conform to (i)
the provisions of the Investment Company Act and any rules or regulations
thereunder; (ii) any other applicable provisions of state or Federal law;
(iii) the provisions of the Declaration of Trust and By-Laws of the Fund
as amended from time to time; (iv) policies and determinations of the
Board of Trustees of the Fund; (v) the fundamental policies and investment
restrictions of the Fund as reflected in its registration statement under
the Investment Company Act or as such policies may, from time to time, be
amended by the Fund's shareholders; and (vi) the Prospectus and Statement
of Additional Information of the Fund in effect from time to time. The
appropriate officers and employees of OFI shall be available upon
reasonable notice for consultation with any of the Trustees and officers
of the Fund with respect to any matters dealing with the business and
affairs of the Fund including the valuation of portfolio securities of the
Fund which are either not registered for public sale or not traded on any
securities market.
2. Investment Management.
(a) OFI shall, subject to the direction and control by the Fund's
Board of Trustees, (i) regularly provide investment advice and
recommendations to the Fund with respect to its investments, investment
policies and the purchase and sale of securities and other instruments;
(ii) supervise continuously the investment program of the Fund and the
composition of its portfolio and determine what securities shall be
purchased or sold by the Fund; and (iii) arrange, subject to the
provisions of paragraph 7 hereof, for the purchase of securities and other
investments for the Fund and the sale of securities and other investments
held in the Fund's portfolio.
(b) Provided that the Fund shall not be required to pay any
compensation for services under this Agreement other than as provided by
the terms of this Agreement and subject to the provisions of paragraph 7
hereof, OFI may obtain investment information, research or assistance from
any other person, firm or corporation to supplement, update or otherwise
improve its investment management services.
(c) Provided that nothing herein shall be deemed to protect OFI from
willful misfeasance, bad faith or gross negligence in the performance of
its duties, or reckless disregard of its obligations and duties under this
Agreement, OFI shall not be liable for any loss sustained by reason of
good faith errors or omissions in connection with any matters to which
this Agreement relates.
(d) Nothing in this Agreement shall prevent OFI or any officer
thereof from acting as investment adviser for any other person, firm or
corporation or in any way limit or restrict OFI or any of its directors,
officers, stockholders or employees from buying, selling or trading any
securities for its or their own account or for the account of others for
whom it or they may be acting, provided that such activities will not
adversely affect or otherwise impair the performance by OFI of its duties
and obligations under this Agreement.
(e) OFI may, at its option and subject to approval by the Trustees
of the Fund, and to the extent necessary, the shareholders of the Fund,
appoint a subadviser to assume certain or all of the responsibilities and
obligations of OFI under this Agreement.
(f) OFI shall have no investment discretion with respect to futures
contracts, options or futures contracts, or other instruments regulated
by the Commodity Futures Trading Commission ("CFTC") except, to the extent
permitted by or consistent with Rule 4.5 and Rule 4.14 promulgated under
the Commodity Exchange Act, or as otherwise permitted by applicable law,
regulation or regulatory relief.
3. Other Duties of OFI.
OFI shall, at its own expense, provide and supervise the activities
of all administrative and clerical personnel as shall be required to
provide effective corporate administration for the Fund, including the
compilation and maintenance of such records with respect to its operations
as may reasonably be required; the preparation and filing of such reports
with respect thereto as shall be required by the Commission; composition
of periodic reports with respect to operations of the Fund for its
shareholders; composition of proxy materials for meetings of the Fund's
shareholders; and the composition of such registration statements as may
be required by Federal and state securities laws for continuous public
sale of shares of the Fund. OFI shall, at its own cost and expense, also
provide the Fund with adequate office space, facilities and equipment.
OFI shall, at its own expense, provide such officers for the Fund as the
Board of Trustees may request.
4. Allocation of Expenses.
All other costs and expenses of the Fund not expressly assumed by OFI
under this Agreement, or to be paid by the Distributor of the shares of
the Fund, shall be paid by the Fund, including, but not limited to: (i)
interest and taxes; (ii) brokerage commissions; (iii) insurance premiums
for fidelity and other coverage requisite to its operations; (iv)
compensation and expenses of its trustees other than those affiliated with
OFI; (v) legal and audit expenses; (vi) custodian and transfer agent fees
and expenses; (vii) expenses incident to the redemption of its shares;
(viii) expenses incident to the issuance of its shares against payment
therefor by or on behalf of the subscribers thereto; (ix) fees and
expenses, other than as hereinabove provided, incident to the registration
under Federal and state securities laws of shares of the Fund for public
sale; (x) expenses of printing and mailing reports, notices and proxy
materials to shareholders of the Fund; (xi) except as noted above, all
other expenses incidental to holding meetings of the Fund's shareholders;
and (xii) such extraordinary non-recurring expenses as may arise,
including litigation, affecting the Fund and any legal obligation which
the Fund may have to indemnify its officers and trustees with respect
thereto. Any officers or employees of OFI or any entity controlling,
controlled by or under common control with OFI who also serve as officers,
trustees or employees of the Fund shall not receive any compensation from
the Fund for their services.
5. Compensation of OFI.
The Fund agrees to pay OFI and OFI agrees to accept as full
compensation for the performance of all functions and duties on its part
to be performed pursuant to the provisions hereof, a fee computed on the
aggregate net asset value of the shares of the Fund as of the close of
each business day and payable monthly at the following annual rate:
1.00% of the first $200 million of net assets;
0.90% of the next $200 million;
0.85% of the next $200 million;
0.80% of the next $200 million; and
0.75% of net assets in excess of $800 million.
6. Use of Name "Xxxxxxxxxxx."
OFI hereby grants to the Fund a royalty-free, non-exclusive license
to use the name "Xxxxxxxxxxx" in the name of the Fund for the duration of
this Agreement and any extensions or renewals thereof. To the extent
necessary to protect OFI's rights to the name "Xxxxxxxxxxx" under
applicable law, such license shall allow OFI to inspect and, subject to
control by the Fund's Board, control the nature and quality of services
offered by the Fund under such name and may, upon termination of this
Agreement, be terminated by OFI, in which event the Fund shall promptly
take whatever action may be necessary to change its name and discontinue
any further use of the name "Xxxxxxxxxxx" in the name of the Fund or
otherwise. The name "Xxxxxxxxxxx" may be used or licensed by OFI in
connection with any of its activities, or licensed by OFI to any other
party.
7. Portfolio Transactions and Brokerage.
(a) OFI is authorized, in arranging the purchase and sale of the
Fund's portfolio investments, to employ or deal with such members of
securities or commodities exchanges, brokers, dealers or futures
commission merchants (hereinafter "broker-dealers"), including
"affiliated" broker-dealers (as that term is defined in the Investment
Company Act), as may, in its best judgment, implement the policy of the
Fund to obtain, at reasonable expense, the "best execution" (prompt and
reliable execution at the most favorable security price obtainable) of the
Fund's portfolio transactions as well as to obtain, consistent with the
provisions of subparagraph (c) of this paragraph 7, the benefit of such
investment information or research as will be of significant assistance
to the performance by OFI of its investment management functions.
(b) OFI shall select broker-dealers to effect the Fund's portfolio
transactions on the basis of its estimate of their ability to obtain best
execution of particular and related portfolio transactions. The abilities
of a broker-dealer to obtain best execution of particular portfolio
transaction(s) will be judged by OFI on the basis of all relevant factors
and considerations including, insofar as feasible, the execution
capabilities required by the transaction or transactions; the ability and
willingness of the broker-dealer to facilitate the Fund's portfolio
transactions by participating therein for its own account; the importance
to the Fund of speed, efficiency or confidentiality; the broker-dealer's
apparent familiarity with sources from or to whom particular securities
might be purchased or sold; as well as any other matters relevant to the
selection of a broker-dealer for particular and related transactions of
the Fund.
(c) OFI shall have discretion, in the interests of the Fund, to
allocate brokerage on the Fund's portfolio transactions to broker-dealers,
other than an affiliated broker-dealer, qualified to obtain best execution
of such transactions who provide brokerage and/or research services (as
such services are defined in Section 28(e)(3) of the Securities Exchange
Act of 1934) for the Fund and/or other accounts for which OFI or its
affiliates exercise "investment discretion" (as that term is defined in
Section 3(a)(35) of the Securities Exchange Act of 1934) and to cause the
Fund to pay such broker-dealers a commission for effecting a portfolio
transaction for the Fund that is in excess of the amount of commission
another broker-dealer adequately qualified to effect such transaction
would have charged for effecting that transaction, if OFI determines, in
good faith, that such commission is reasonable in relation to the value
of the brokerage and/or research services provided by such broker-dealer,
viewed in terms of either that particular transaction or the overall
responsibilities of OFI or its affiliates with respect to the accounts as
to which they exercise investment discretion. In reaching such
determination, OFI will not be required to place or attempt to place a
specific dollar value on the brokerage and/or research services provided
or being provided by such broker-dealer. In demonstrating that such
determinations were made in good faith, OFI shall be prepared to show that
all commissions were allocated for purposes contemplated by this Agreement
and that the total commissions paid by the Fund over a representative
period selected by the Fund's trustees were reasonable in relation to the
benefits to the Fund.
(d) OFI shall have no duty or obligation to seek advance competitive
bidding for the most favorable commission rate applicable to any
particular portfolio transactions or to select any broker-dealer on the
basis of its purported or "posted" commission rate but will, to the best
of its ability, endeavor to be aware of the current level of the charges
of eligible broker-dealers and to minimize the expense incurred by the
Fund for effecting its portfolio transactions to the extent consistent
with the interests and policies of the Fund as established by the
determinations of the Board of Trustees of the Fund and the provisions of
this paragraph 7.
(e) The Fund recognizes that an affiliated broker-dealer: (i) may
act as one of the Fund's regular brokers for the Fund so long as it is
lawful for it so to act; (ii) may be a major recipient of brokerage
commissions paid by the Fund; and (iii) may effect portfolio transactions
for the Fund only if the commissions, fees or other remuneration received
or to be received by it are determined in accordance with procedures
contemplated by any rule, regulation or order adopted under the Investment
Company Act for determining the permissible level of such commissions.
(f) Subject to the foregoing provisions of this paragraph 7, OFI may
also consider sales of shares of the Fund and the other funds advised by
OFI and its affiliates as a factor in the selection of broker-dealers for
its portfolio transactions.
8. Duration.
This Agreement will take effect on the date first set forth above.
Unless earlier terminated pursuant to paragraph 10 hereof, this Agreement
shall remain in effect until two years from the date of execution hereof,
and thereafter will continue in effect from year to year, so long as such
continuance shall be approved at least annually by the Fund's Board of
Trustees, including the vote of the majority of the trustees of the Fund
who are not parties to this Agreement or "interested persons" (as defined
in the Investment Company Act) of any such party, cast in person at a
meeting called for the purpose of voting on such approval, or by the
holders of a "majority" (as defined in the Investment Company Act) of the
outstanding voting securities of the Fund and by such a vote of the Fund's
Board of Trustees.
9. Disclaimer of Shareholder or Trustee Liability.
OFI understands and agrees that the obligations of the Fund under
this Agreement are not binding upon any shareholder or Trustee of the Fund
personally, but bind only the Fund and the Fund's property; OFI represents
that it has notice of the provisions of the Declaration of Trust of the
Fund disclaiming shareholder or Trustee liability for acts or obligations
of the Fund.
10. Termination.
This Agreement may be terminated (i) by OFI at any time without
penalty upon sixty days' written notice to the Fund (which notice may be
waived by the Fund); or (ii) by the Fund at any time without penalty upon
sixty days' written notice to OFI (which notice may be waived by OFI)
provided that such termination by the Fund shall be directed or approved
by the vote of a majority of all of the trustees of the Fund then in
office or by the vote of the holders of a "majority" of the outstanding
voting securities of the Fund (as defined in the Investment Company Act).
11. Assignment or Amendment.
This Agreement may not be amended or the rights of OFI hereunder
sold, transferred, pledged or otherwise in any manner encumbered without
the affirmative vote or written consent of the holders of the "majority"
of the outstanding voting securities of the Fund. This Agreement shall
automatically and immediately terminate in the event of its "assignment,"
as defined in the Investment Company Act.
12. Definitions.
The terms and provisions of the Agreement shall be interpreted and
defined in a manner consistent with the provisions and definitions
contained in the Investment Company Act.
XXXXXXXXXXX REAL ASSET FUND
Attest:
/s/ Xxxxxx X. Xxxx /s/ Xxxxxxx Xxxxxxxxx
__________________ _____________________
Xxxxxx X. Xxxx, Xxxxxxx Xxxxxxxxx, President
Assistant Secretary
OPPENHEIMERFUNDS, INC.
Attest:
/s/ Xxxxxxxxx X. Xxxx /s/ Xxxxxx X. Xxxxxxx
_____________________ _____________________
Xxxxxxxxx X. Xxxx Xxxxxx X. Xxxxxxx, Vice President
Vice President
ADVISORY\735
