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EXHIBIT 99.B5
Advisory Contract
THE HAVEN CAPITAL MANAGEMENT TRUST
and
THE HAVEN FUND
May 19, 1994
Haven Capital Management, Inc.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Investment Advisory Agreement
Dear Sirs:
The Haven Capital Management Trust (the "Trust") has been
organized as a business trust under the laws of the State of Delaware to engage
in the business of an investment company. The Trust's shares of beneficial
interest may be classified into series, each series representing the entire
undivided interest in a separate portfolio of assets. As of the date hereof,
the Trust has one series of shares, representing interests in The Haven Fund
(the "Fund").
The Trustees of the Trust (the "Trustees") have selected you to
provide investment advice to the Fund, as more fully set forth below, and you
are willing to provide
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such advice under the terms and conditions hereinafter set forth. Accordingly,
the Trust agrees with you as follows:
1. Delivery of Documents. The Trust has furnished you with
copies, properly certified or otherwise authenticated, of each of the
following:
(a) Agreement and Declaration of Trust of the Trust, dated as
of March 17, 1994 (the "Declaration").
(b) By-Laws of the Trust as in effect on the date hereof.
(c) Resolution of the Trustees selecting you as investment
adviser for the Fund and approving the form of this Agreement.
(d) Commitments, limitations and undertakings made by the Trust to
state "blue sky" authorities for the purpose of
qualifying shares of the Trust representing beneficial
interests in the Fund (the "Shares") for sale in such states.
(e) Pre-Effective Amendment No. 1 to the Trust's Registration
Statement on Form N-1A, dated
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May 25, 1994, registering the Shares under the Securities Act
of 1933, as amended, together with all exhibits and amendments
thereto (the "N-1A Registration Statement").
(f) Pre-Effective Amendment No. 2 to the Trust's Registration
Statement on Form N-14, dated May 25, 1994, together with all
exhibits and amendments thereto.
(g) Amended and Restated Application for an Order Pursuant to
Section 17(b) of the Investment Company Act of 1940
Authorizing Certain Transactions Which Are Otherwise
Prohibited Under Section 17(a) of the Act, dated May __, 1994.
(h) Notice of an Application for an Order Pursuant to Section
17(b) of the Investment Company Act of 1940 Authorizing
Certain Transactions Which Are Otherwise Prohibited Under
Section 17(a) of the Act, dated April 29, 1994.
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(i) Letter Ruling, dated February 23, 1994, issued by the Internal
Revenue Service to HCM Partners, L.P.
The Trust will furnish you from time to time with copies, properly certified or
otherwise authenticated, of all amendments of or supplements to the foregoing,
if any.
2. Investment Advisory Services. You will use your best efforts
to provide to the Fund continuing and suitable investment programs consistent
with the investment objective, policies and restrictions of the Fund. In the
performance of your duties hereunder, subject always (x) to the provisions
contained in the documents delivered to you pursuant to Section 1 as each of
the same may from time to time be amended or supplemented and (y) to the
limitations set forth in the N-1A Registration Statement as in effect from time
to time, as amended, you will, at your expense:
(a) determine from time to time which securities shall be
purchased, sold or exchanged and what portion of the
assets of the Fund shall be held in the various securities and
assets in which the Fund invests or in cash;
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(b) make decisions for the Fund with respect to foreign
currency matters and foreign exchange contracts, having
regard to foreign exchange controls, if any;
(c) make determinations as to the manner in which voting
rights, subscription rights, rights to consent to
corporate action and any other rights pertaining to
the Fund's assets shall be exercised;
(d) advise the Trust in connection with policy decisions to be
made by the Trustees or any committee thereof with
respect to the Fund's investments and, as requested,
furnish the Fund with research, economic and
statistical data in connection with its investments
and investment policies;
(e) submit such reports relating to the valuation of the
Fund's securities as the Trustees or the
administrator of the Fund may reasonably request;
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(f) place orders for the purchase, sale or exchange of
portfolio assets for the Fund's accounts with brokers
or dealers selected by you; provided, however, that
in connection with the placing of such orders and the
selection of such brokers or dealers you shall seek
to obtain execution and pricing within the policy
guidelines established by the Trustees and set forth
in the N-1A Registration Statement as in effect from
time to time;
(g) provide information in your possession to the
administrator of the Fund as such administrator may
request to maintain and preserve the records required
by the Investment Company Act of 1940, as amended
(the "Investment Company Act");
(h) obtain and evaluate such information relating to
economies, industries, businesses, securities markets
and securities as you may deem
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necessary or useful in the discharge of your duties hereunder;
(i) from time to time, or at any time requested by the
Trustees, make reports to the Trustees concerning
your performance of the foregoing services and
furnish advice and recommendations with respect to
other aspects of the business and affairs of the
Fund; and
(j) cooperate generally with the Trust and the Fund to provide
information necessary for the preparation of
registration statements and periodic reports to be
filed with the Securities and Exchange Commission,
including post-effective amendments to the Form N-1A
Registration Statement, filings on Form N-SAR,
periodic statements, reports to shareholders,
shareholder communications and proxy material
furnished to holders of the Shares, filings with
state "blue sky" authorities and with the United
States
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agencies responsible for tax matters, and other reports
and filings of like nature.
3. Expenses of the Fund. You will pay for maintaining the
staff and personnel necessary to perform your obligations under this Agreement
and shall, at your own expense, maintain the office space, facilities,
equipment and personnel that are reasonably necessary to carry out your
obligations hereunder. In addition, you shall pay the reasonable salaries,
fees and expenses of such of the Trust's officers and employees (including
payroll taxes) and any fees and expenses of such of the Trustees as are
directors, officers or employees of you.
4. Expenses of the Trust or the Fund Not Paid by You. You
will not be required to pay any expenses which this Agreement does not
expressly make payable by you. In particular, and without limiting the
generality of the foregoing but subject to the provisions of Section 3, the
Trust and the Fund assume and shall pay or cause to be paid fees to you and the
administrator of the Trust and the Fund and all other expenses of the Trust and
the Fund including, without limitation: (i) charges and expenses of any
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custodian, subcustodian or depositary appointed by the Trust or the Fund for
the safekeeping of cash, securities or property and fees and expenses of any
transfer agent, dividend paying agent and registrar for the Fund; (ii) charges
and expenses of accounting and auditing; (iii) expenses and fees associated
with registering and qualifying securities issued by the Trust and the Fund for
sale with the Securities and Exchange Commission and in various states,
expenses of preparing Share certificates, if any, and other expenses in
connection with the issuance, offering or distribution of securities issued by
the Trust and the Fund, including freight insurance and other charges in
connection with the shipment of the Fund's portfolio securities; (iv) expenses
and fees associated with obtaining an order pursuant to Section 17(b) of the
Investment Company Act authorizing certain transactions; (v) expenses of
stationery, preparing, printing and distributing reports, notices and dividends
and other documents to the Fund's shareholders, including, without limitation,
to the extent not borne by the Fund's administrator, distributor or transfer
agent; (vi) interest on any indebtedness of the
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Fund; (vii) governmental fees and taxes of the Trust and the Fund, including
any stock transfer tax payable on a portfolio security of the Fund; (viii)
brokerage commissions and other expenses incurred in acquiring or disposing of
the Fund's portfolio securities; (ix) costs of trustees' and officers'
insurance and fidelity bonds; (x) compensation and expenses of the Trustees who
are not interested persons of you, including out-of-pocket travel expenses;
(xi) costs and expenses incidental to holding meetings of the Trustees, or any
committees thereof, or meetings of shareholders; (xii) fees for legal, auditing
and consulting services and litigation expenses, including settlement or
arbitration costs; (xiii) dues and expenses incurred in connection with
membership in investment company organizations and expenses relating to
investor and public relations; and (xiv) costs, expenses and fees incurred in
connection with obtaining, maintaining, refinancing or repaying indebtedness.
5. Compensation of the Adviser. For all services to be
rendered, facilities furnished and expenses paid or assumed by you as herein
provided, the Trust will pay you, on behalf of the Fund, an investment advisory
fee,
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which shall accrue daily and be payable monthly in arrears, calculated at an
annual rate of 0.60% of the Fund's average daily net assets.
If this Agreement becomes effective subsequent to the first day of
a month or shall terminate before the last day of a month, compensation for
that part of the month that this Agreement is in effect shall be subject to a
pro rata adjustment based on the number of days elapsed in the relevant month
as a percentage of the total number of days in such month in order to permit
the fee to be calculated in a manner consistent with the calculation of the fee
as set forth above. During any period when the determination of net asset
value is suspended by the Trustees, the average net asset value of a Share for
the last day prior to such suspension shall for this purpose be deemed to be
the average net asset value at the close of each succeeding day until it is
again determined.
In the event the operating expenses of the Fund, including amounts
payable to you pursuant to this Section 5, for any fiscal year of the Fund
ending on a date on which this Agreement is in effect, exceed the expense
limitations
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applicable to the Fund imposed by applicable state securities laws or
regulations thereunder, as such limitations may be raised or lowered from time
to time, you shall reduce your management fee by the extent of such excess and,
if required pursuant to any such laws or regulations, will reimburse the Fund
in the amount of such excess; provided, however, to the extent permitted by
law, there shall be excluded from such expenses the amount of any interest,
taxes, brokerage commissions and extraordinary expenses (including but not
limited to legal claims and liabilities and litigation costs, including
settlement or arbitration costs, and any indemnification related thereto) paid
or payable by the Fund. Whenever the expenses of the Fund exceed a pro rata
portion of the applicable annual expense limitations, the estimated amount of
reimbursement under such limitations shall be applicable as an offset against
the monthly payment of the management fee due to you. Should two or more such
expense limitations be applicable as at the end of the last business day of the
month, that expense limitation which results in the largest reduction in your
fee shall be applicable.
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The net asset value of the Fund shall be determined pursuant to
the applicable provisions of the Trust's Declaration of Trust and applicable
law, and as described in the N-1A Registration Statement, as such registration
statement may be amended from time to time.
6. Other Activities of Adviser and Its Affiliates. Nothing
herein contained shall prevent you or any affiliate or associate of yours from
engaging in any other business or from acting as investment adviser or
investment manager for any other person or entity, whether or not having
investment policies or portfolios similar to that of the Fund; and it is
specifically understood that officers, directors, and employees of yours and of
your subsidiaries, if any, may continue to engage in providing portfolio
management services and advice to other investment companies, whether or not
registered, and to other investment advisory clients of yours.
7. Avoidance of Inconsistent Position. In connection with
purchases or sales of portfolio securities for the account of the Fund, neither
you nor any of your directors, officers or employees will act as principal or
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agent or receive any commission. If any occasion should arise in which you
advise persons concerning the Shares, you will act solely on your own behalf
and not in any way on behalf of the Trust or the Fund.
8. No Partnership or Joint Venture. The Trust, the Fund and
you are not partners of or joint venturers with each other and nothing herein
shall be construed so as to make them such partners or joint venturers or
impose any liability as such on any of them.
9. Name of Trust and Fund. The Trust and the Fund may use
the name "Haven" or any name derived from or similar to the name "Haven Capital
Management, Inc." only for so long as this Agreement or any extension, renewal,
or amendment hereof remains in effect. At such time as such Agreement shall no
longer be in effect, the Trust and the Fund will (to the extent they lawfully
can) cease to use such a name or any other name indicating that the Fund is
advised or they are otherwise connected with you. The Trust acknowledges that
it has adopted the name "The Haven Capital Management Trust," and the Fund has
adopted the name "The Haven Fund," through permission of Haven Capital
Management,
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Inc., a Delaware corporation, and agrees that Haven Capital Management, Inc.
reserves to itself and any successor to its business the right to grant the
non-exclusive right to use the name "Haven" or any similar name to any other
corporation or entity, including but not limited to any investment company of
which Haven Capital Management, Inc., or any subsidiary or affiliate thereof or
any successor to the business of any thereof shall be the investment adviser.
10. Limitation of Liability of Adviser. You shall not be
liable for any error of judgment or mistake of law or for any loss suffered by
the Trust or the Fund in connection with the matters to which this Agreement
relates if such actions by you were performed in good faith and were reasonably
believed by you to be in or not opposed to the best interests of the Trust or
Fund, as the case may be, except a loss resulting from willful misfeasance, bad
faith or gross negligence on your part in the performance of your duties or
from reckless disregard by you of your obligations and duties under this
Agreement. Any person, even though also employed by you, who may be or become
an employee of and paid by the Trust or the Fund shall be deemed, when
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acting within the scope of his employment by the Trust or the Fund, to be
acting in such employment solely for the Trust or the Fund and not as your
employee or agent.
You shall not be liable for any losses caused by disturbances of
your operations by virtue of force majeure, war, riot, or damage caused by
nature or due to other events for which you are not responsible (e.g., strike,
lock-out or losses caused by the imposition of foreign exchange controls,
expropriation of assets or other acts of domestic or foreign authorities).
The presence of exculpatory language in this Agreement shall not
be deemed by the Trust, the Fund, you or any other party appointed pursuant to
this Agreement, including without limitation any custodian, as in any way
limiting causes of action and remedies which may, notwithstanding such
language, be available to the Trust or Fund either under common law or
statutory law principles applicable to fiduciary relationships or under the
federal securities laws.
11. Duration and Termination of this Agreement. This Agreement
shall remain in force until the second anni-
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versary of the date upon which this Agreement was executed by the parties
hereto, and from year to year thereafter, but only so long as such continuance
is specifically approved at least annually by (a) a majority of the Trustees
who are not interested persons of you or (other than as Trustees) of the Trust,
cast in person at a meeting called for the purpose of voting on such approval,
and (b) either (i) the Trustees or (ii) a majority of the outstanding voting
securities of the Fund. This Agreement may, on 60 days' written notice, be
terminated at any time by the Trustees without the payment of any penalty by
the Trust or the Fund, by vote of a majority of the outstanding voting
securities of the Fund, or by you. Termination of this Agreement with respect
to the Fund shall not be deemed to terminate or otherwise invalidate any
provision of any contract between you and any other series of the Trust. This
Agreement shall automatically terminate in the event of its assignment. In
interpreting the provisions of this Section 11, the definitions contained in
Section 2(a) of the Investment Company Act (particularly the definitions of
"assignment", "interested person" and "voting security") shall be applied.
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12. Amendment of This Agreement. No provision of this Agreement
may be changed, waived, discharged or terminated orally, but only by an
instrument in writing signed by the party against which enforcement of the
change, waiver, discharge or termination is sought, and no amendment, transfer,
assignment, sale, hypothecation or pledge of this Agreement shall be
effective until approved by (a) the Trustees, including a majority of the
Trustees who are not interested persons of you or (other than as Trustees) of
the Trust cast in person at a meeting called for the purpose of voting on such
approval, and (b) a majority of the outstanding voting securities of the Fund,
as defined in the Investment Company Act, provided that no approval shall be
required pursuant to this clause (b) in respect of any contract between you and
the holders of outstanding voting securities of any other series of the Trust
other than the Fund.
13. Notice. Any notice or other communication required to be
given pursuant to this Agreement shall be in writing or by fax, with hard copy
to follow, and shall be effective upon receipt. Notices and communications
shall be
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given: (a) to the Trust and the Fund c/o Haven Capital Management, Inc., 000
Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxx X. Xxxxxxxxx and (b)
to you at the same address.
14. Governing Law. This Agreement shall be construed in
accordance with the laws of the State of New York and the applicable provisions
of the Investment Company Act. To the extent the applicable laws of the State
of New York, or any of the provisions herein, conflict with the applicable
provisions of the Investment Company Act, the latter shall control.
15. Miscellaneous. The captions in this Agreement are
included for convenience of reference 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 simultaneously in two or more counterparts, each
of which shall be deemed an original, but all of which together shall
constitute one and the same instrument. The names The Haven Capital Management
Trust and The Haven Fund are the designations of the Trustees under the
Declaration, dated as of March 17, 1994, as amended from time to
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time. The Declaration has been filed with the Secretary of State of the State
of Delaware. The obligations of the Trust or the Fund are not binding upon any
of the Trustees, shareholders, officers, employees or agents of the Trust
individually, but only upon the assets and property of the Fund.
Yours very truly,
THE HAVEN CAPITAL MANAGEMENT
TRUST, for itself and its
initial series, The Haven Fund
By /s/ Xxxxx X. Xxxxxxxxx
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President
The foregoing Agreement
is hereby agreed to as of
the date hereof.
HAVEN CAPITAL MANAGEMENT, INC.
By /s/ Xxxxx X. Xxxxx
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Title:
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