Exhibit d(4)
MANAGEMENT AGREEMENT
This MANAGEMENT AGREEMENT, dated as of August 1, 2005, is by and
between DOMINI SOCIAL INVESTMENT TRUST, a Massachusetts business trust (the
"Trust"), and Domini Social Investments LLC, a Massachusetts limited liability
company ("DSI" or the "Manager").
W I T N E S S E T H:
WHEREAS, the Trust is engaged in business as an open-end management
investment company and is registered under the Investment Company Act of 1940,
as amended (collectively with the rules and regulations promulgated thereunder
and any exemptive orders thereunder, the "1940 Act"); and
WHEREAS, the Trust wishes to engage DSI to provide certain oversight,
administrative and management services for the series of the Trust designated on
Schedule A attached hereto (each, a "Fund"), and DSI is willing to provide such
oversight, administrative and management services for each such Fund on the
terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
of the parties hereto as herein set forth, the parties covenant and agree as
follows:
1. Duties of the Manager. (a) Manager shall act as the Manager for each
Fund and as such shall furnish continuously an investment program and shall
determine from time to time what securities shall be purchased, sold or
exchanged and what portion of the assets of each Fund shall be held uninvested,
subject always to the restrictions of the Trust's Declaration of Trust, dated as
of June 7, 1989, and By-Laws, as each may be amended and restated from time to
time (respectively, the "Declaration" and the "By-Laws"), the provisions of the
1940 Act, and the then-current registration statement of the Trust with respect
to each Fund. The Manager shall also make recommendations as to the manner in
which voting rights, rights to consent to corporate action and any other rights
pertaining to each Fund's portfolio securities shall be exercised. Should the
Board of Trustees of the Trust at any time, however, make any definite
determination as to investment policy applicable to a Fund and notify the
Manager thereof in writing, the Manager shall be bound by such determination for
the period, if any, specified in such notice or until similarly notified that
such determination has been revoked. The Manager shall take, on behalf of each
Fund, all actions which it deems necessary to implement the investment policies
determined as provided above, and in particular to place all orders for the
purchase or sale of securities for the Fund's account with the brokers or
dealers selected by it, and to that end the Manager is authorized as the agent
of the Trust to give instructions to the custodian or any subcustodian of the
Fund as to deliveries of securities and payments of cash for the account of the
Fund. In connection with the selection of such brokers or dealers and the
placing of such orders, brokers or dealers may be selected who also provide
brokerage and research services (as those terms are defined in Section 28(e) of
the Securities Exchange Act of 1934) to the Funds and/or the other accounts over
which the Manager, any subadviser, submanager or respective "affiliated person"
thereof exercises investment discretion.
The Manager is authorized to pay a broker or dealer who provides such brokerage
and research services a commission for executing a portfolio transaction for a
Fund which is in excess of the amount of commission another broker or dealer
would have charged for effecting that transaction if the Manager determines in
good faith that such amount of commission is reasonable in relation to the value
of the brokerage and research services provided by such broker or dealer. This
determination may be viewed in terms of either that particular transaction or
the overall responsibilities which the Manager and any "affiliated person" of
the Manager have with respect to accounts over which they exercise investment
discretion. In making purchases or sales of securities or other property for the
account of a Fund, the Manager may deal with itself or with the Trustees of the
Trust or the Trust's underwriter or distributor or with its or their respective
affiliates, or affiliates of affiliates, to the extent such actions are
permitted by the 1940 Act. In providing the management services and assuming the
obligations set forth herein, the Manager may, subject to the requirements of
the 1940 Act, employ, at its own expense, or may request that the Trust employ
at each Fund's expense, one or more subadvisers or submanagers; provided that in
each case the Manager shall supervise the activities of each subadviser and
submanager. Any agreement between the Manager and a subadviser or submanager
shall be subject to the renewal, termination and amendment provisions applicable
to this Agreement. Any agreement by the Trust on behalf of a Fund and a
subadviser may be terminated by the Manager at any time on not more than 60
days' nor less than 30 days' written notice to the Trust and the subadviser. To
the extent authorized by the Board of Trustees and subject to applicable
provisions of the 1940 Act, the investment program to be provided hereunder may
entail the investment of all or a portion of the assets of a Fund in one or more
investment companies.
(b) Subject to the direction and control of the Board of Trustees of
the Trust, the Manager shall perform such oversight, administrative and
management services as may from time to time be reasonably requested by the
Trust with respect to each Fund, which shall include without limitation: (i)
maintaining office facilities (which may be in the office of DSI or an
affiliate) and furnishing clerical services necessary for maintaining the
organization of the Trust and each Fund and for performing the oversight,
administrative and management functions herein set forth; (ii) arranging, if
desired by the Trust, for directors, officers or employees of the Manager to
serve as Trustees, officers or agents of the Trust if duly elected or appointed
to such positions and subject to their individual consent and to any limitations
imposed by law; (iii) supervising the overall administration of the Trust and
each Fund, including the updating of corporate organizational documents, and the
negotiation of contracts and fees with and the monitoring and coordinating of
performance and xxxxxxxx of each Fund's transfer agent, shareholder servicing
agents (if any), custodian, administrator, subadministrator (if any) and other
independent contractors or agents; (iv) overseeing (with advice of the Trust's
counsel) the preparation of and, if applicable, filing all documents required
for compliance by the Trust with applicable laws and regulations (including
state "blue sky" laws and regulations), including registration statements on
Form N-1A, prospectuses and statements of additional information, or similar
forms, as applicable, semi-annual and annual reports to shareholders and proxy
statements, and reviewing tax returns; (v) preparing agendas and supporting
documents for and minutes of meetings of Trustees, committees of Trustees and
preparing notices, proxy statements and minutes of meetings of shareholders;
(vi) arranging for maintenance of books and records of the Trust; (vii)
maintaining telephone coverage to respond to shareholder inquiries regarding
matters to which this Agreement pertains to
which the transfer agent is unable to respond; (viii) providing reports and
assistance regarding each Fund's compliance with securities and tax laws and
each Fund's investment objectives; (ix) arranging for dissemination of yield and
other performance information to newspapers and tracking services; (x) arranging
for and preparing annual renewals for fidelity bond and errors and omissions
insurance coverage; (xi) developing a budget for the Trust and each Fund,
establishing the rate of expense accruals and arranging for the payment of all
fixed and management expenses; and (xii) answering questions from the general
public, the media and investors in each Fund regarding (A) the securities
holdings of each Fund; (B) any limits in which each Fund invests; (C) the social
investment philosophy of each Fund; and (D) the proxy voting philosophy and
shareholder activism philosophy of each Fund.
(c) Notwithstanding the foregoing, the Manager shall not be deemed to
have assumed, pursuant to this Agreement, any duties with respect to, and shall
not be responsible for, the distribution of shares of beneficial interest in any
Fund, nor shall the Manager be deemed to have assumed or have any responsibility
with respect to functions specifically assumed by any transfer agent, custodian,
fund accounting and pricing agent or shareholder servicing agent of the Trust or
any Fund.
(d) In providing administrative and management services as set forth
herein, the Manager may, at its own expense, employ one or more
subadministrators; provided that the Manager shall remain fully responsible for
the performance of all administrative and management duties set forth herein and
shall supervise the activities of each subadministrator.
2. Allocation of Charges and Expenses. DSI shall pay the entire
salaries and wages of all of the Trust's Trustees, officers and agents who
devote part or all of their time to the affairs of DSI or its affiliates, and
the wages and salaries of such persons shall not be deemed to be expenses
incurred by the Trust for purposes of this Section 2. The Trust shall pay from
the assets of each Fund all of its own expenses allocable to that Fund,
including, but not limited to, fees due the Manager under this Agreement;
compensation of Trustees who are not "interested persons" of the Trust;
organizational costs of the Fund; governmental fees; interest charges; loan
commitment fees, taxes and related charges; brokerage fees and commissions;
membership dues in industry and professional associations allocable to the
Trust; fees and expenses of independent auditors and accountants, legal counsel
and any transfer agent, distributor, shareholder servicing agent, service agent,
recordkeeper, registrar or dividend disbursing agent of the Trust or the Fund;
expenses of distributing, issuing and redeeming shares of beneficial interest
and servicing shareholder accounts; expenses of preparing, typesetting, printing
and mailing prospectuses, statements of additional information, shareholder
reports, notices, proxy statements and reports to governmental officers and
commissions and to existing shareholders of the Fund; expenses connected with
the execution, recording and settlement of portfolio security transactions;
insurance premiums; fees and expenses of the custodian for all services to the
Fund, including safekeeping of funds and securities and maintaining required
books and accounts; expenses of calculating the net asset value of the Fund
(including but not limited to the fees of independent pricing services);
expenses of meetings of the Trust's Trustees and the Fund's shareholders;
expenses relating to the issuance, registration and qualification of shares of
the Fund; and such non-recurring or extraordinary expenses as may arise,
including those relating to actions, suits or proceedings to which the Trust on
behalf of the
Fund may be a party and the legal obligation which the Trust may have to
indemnify its Trustees and officers with respect thereto.
3. Compensation of the Manager. For the services to be rendered and the
facilities to be provided by the Manager hereunder, the Trust shall pay to the
Manager from the assets of each Fund a management fee computed daily and paid
monthly at an annual rate equal to the lesser of (i) that percentage of that
Fund's average daily net assets for the Fund's then-current fiscal year set
forth opposite the Fund's name on Schedule A annexed hereto (the "Aggregate
Management Fee"), minus that Fund's Aggregate Subadviser Fee (as defined below),
if any, and (ii) the difference between that Fund's Aggregate Management Fee for
the Fund's then-current fiscal year and the aggregate management fees allocated
to that Fund for the Fund's then-current fiscal year from the registered
investment company portfolios in which it invests (for which the Manager or an
affiliate serves as investment adviser). To the extent that any Fund's Aggregate
Subadviser Fee exceeds that Fund's Aggregate Management Fee, the Manager shall
pay such amount to the applicable subadvisers on the Fund's behalf. A Fund's
Aggregate Subadviser Fee is the aggregate amount payable by that Fund to
subadvisers pursuant to agreements between the Trust on behalf of the Fund and
the subadvisers. If the Manager provides services hereunder for less than the
whole of any period specified in this Section 3, the compensation to the Manager
shall be accordingly adjusted and prorated.
4. Covenants of Manager. The Manager agrees that it will not deal with
itself, or with the Trustees of the Trust or the Trust's principal underwriter
or distributor, as principals in making purchases or sales of securities or
other property for the account of a Fund, except as permitted by the 1940 Act,
and will comply with all other provisions of the Declaration and By-Laws and the
then-current Registration Statement applicable to each Fund relative to the
Manager and its directors and officers.
5. Limitation of Liability of the Manager. The Manager shall not be
liable for any error of judgment or mistake of law or for any loss arising out
of any investment or for any act or omission in the execution of securities
transactions for a Fund or the oversight, administration or management of the
Trust or the performance of its duties hereunder, except for willful
misfeasance, bad faith or gross negligence in the performance of its duties, or
by reason of the reckless disregard of its obligations and duties hereunder. As
used in this Section 5, the term "Manager" shall include DSI and/or any of its
affiliates and the directors, officers and employees of DSI and/or any of its
affiliates.
6. Activities of the Manager. The services of the Manager to the Trust
are not to be deemed to be exclusive, DSI being free to render investment
advisory, oversight, administrative and/or other services to other parties. It
is understood that Trustees, officers and shareholders of the Trust are or may
become interested in the Manager and/or any of its affiliates as directors,
officers, employees or otherwise and that directors, officers and employees of
the Manager and/or any of its affiliates are or may become similarly interested
in the Trust and that the Manager and/or any of its affiliates may be or become
interested in the Trust as a shareholder or otherwise.
7. Duration, Termination and Amendments of this Agreement. This
Agreement shall become effective as to a Fund as of the day and year set forth
opposite such Fund's name on Appendix A attached hereto, shall govern the
relations between the parties hereto thereafter, and shall remain in force for a
period of two years from its effectiveness, on which date it will terminate
unless its continuance with respect to a Fund after that date is "specifically
approved at least annually" (a) by the vote of a majority of the Trustees of the
Trust who are not "interested persons" of the Trust or of the Manager at a
meeting specifically called for the purpose of voting on such approval, and (b)
by the Board of Trustees of the Trust or by "vote of a majority of the
outstanding voting securities" of the Fund.
This Agreement may be terminated at any time with respect to a Fund
without the payment of any penalty by the Trustees or by the "vote of a majority
of the outstanding voting securities" of the Fund, or by the Manager, in each
case on not more than 60 days' nor less than 30 days' written notice to the
other party. This Agreement shall automatically terminate in the event of its
"assignment".
This Agreement may be amended with respect to a Fund only if such
amendment is approved by the "vote of a majority of the outstanding voting
securities" of the Fund (except for any such amendment as may be effected in the
absence of such approval without violating the 1940 Act).
The terms "specifically approved at least annually," "vote of a
majority of the outstanding voting securities," "assignment," "affiliated
person," and "interested persons," when used in this Agreement, shall have the
respective meanings specified in, and shall be construed in a manner consistent
with, the 1940 Act, subject, however, to such exemptions as may be granted by
the Securities and Exchange Commission under said Act.
8. Severability. If any provision of this Agreement shall become or
shall be found to be invalid by a court decision, statute, rule or otherwise,
the remainder of this Agreement shall not be affected thereby.
9. Notice. Any notices under this Agreement shall be in writing
addressed and delivered personally, by telecopy or mailed postage-paid to the
other party at such address as such other party may designate in accordance with
this Section 9 for the receipt of such notice. Until further notice to the other
party, it is agreed that the address of the Trust shall be 000 Xxxxxxxx, 0xx
Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, and the address of DSI shall be 000 Xxxxxxxx,
0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000.
10. 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 and interpreted in
accordance with and governed by the laws of the Commonwealth of Massachusetts
without reference to principles of conflicts of law. The captions in this
Agreement are included for convenience only and in no way define or delimit any
of the provisions hereof or otherwise affect their construction or effect. This
Agreement may be executed
in any number of counterparts, each of which shall be deemed to be an original,
but such counterparts shall, together, constitute only one instrument.
Each party acknowledges and agrees that all obligations of the Trust
under this Agreement are binding only with respect to the applicable Fund; that
any liability of the Trust under this Agreement, or in connection with the
transactions contemplated herein, shall be discharged only out of the assets of
that Fund; and that no other Fund or series of the Trust shall be liable with
respect to this Agreement or in connection with the transactions contemplated
herein.
The undersigned officer of the Trust has executed this Agreement not
individually, but as an officer under the Declaration and the obligations of
this Agreement are not binding upon any of the Trustees, officers or
shareholders of the Trust individually.
[SIGNATURE PAGE FOLLOWS.]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered in their names and on their behalf by the undersigned,
thereunto duly authorized, all as of the day and year first above written.
DOMINI SOCIAL INVESTMENT TRUST, on
behalf of itself and its series listed on
Schedule A attached hereto.
By: /s/ Xxxxxx X. Xxxxxx
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Title: Treasurer
DOMINI SOCIAL INVESTMENTS LLC
By: /s/ Xxx X. Xxxxxx
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Title: Manager
SCHEDULE A
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FUND AGGREGATE MANAGEMENT FEE EFFECTIVE DATE
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Domini European Social Equity Fund 1.00% August 1, 2005
