XXXXXX FUNDS TRUST
MANAGEMENT CONTRACT
Management Contract dated as of June 7, 1996, as revised October 3,
1996, December 6, 1996, November 6, 1997, December 8, 1997, January 8,
1998, March 5, 1998, May 8, 2000, June 5, 2000, July 24, 2000, November
6, 2000, December 11, 2000 and January 21, 2003, between XXXXXX FUNDS
TRUST, a Massachusetts business trust (the "Fund"), and XXXXXX
INVESTMENT MANAGEMENT, LLC, a Delaware limited liability company (the
"Manager").
WITNESSETH:
That in consideration of the mutual covenants herein contained, it is
agreed as follows:
1. SERVICES TO BE RENDERED BY MANAGER TO FUND.
(a) The Manager, at its expense, will furnish continuously an investment
program for each series of the Fund, will determine what investments
shall be purchased, held, sold or exchanged by each series of the Fund
and what portion, if any, of the assets of each series of the Fund shall
be held uninvested and shall, on behalf of each series of the Fund, make
changes in such series' investments. Subject always to the control of
the Trustees of the Fund and except for the functions carried out by the
officers and personnel referred to in Section 1(d), the Manager will
also manage, supervise and conduct the other affairs and business of the
Fund and matters incidental thereto. In the performance of its duties,
the Manager will comply with the provisions of the Agreement and
Declaration of Trust and By-Laws of the Fund and the stated investment
objectives, policies and restrictions of each series of the Fund, and
will use its best efforts to safeguard and promote the welfare of the
Fund and to comply with other policies which the Trustees may from time
to time determine and shall exercise the same care and diligence
expected of the Trustees.
(b) The Manager, at its expense, except as such expense is paid by the
Fund as provided in Section 1(d), will furnish (1) all necessary
investment and management facilities, including salaries of personnel,
required for it to execute its duties faithfully; (2) suitable office
space for the Fund; and (3) administrative facilities, including
bookkeeping, clerical personnel and equipment necessary for the
efficient conduct of the affairs of the Fund, including determination of
the net asset value of each series of the Fund, but excluding
shareholder accounting services. Except as otherwise provided in
Section 1(d), the Manager will pay the compensation, if any, of the
officers of the Fund.
(c) The Manager, at its expense, shall place all orders for the purchase
and sale of portfolio investments for the Fund's account with brokers or
dealers selected by the Manager. In the selection of such brokers or
dealers and the placing of such orders, the Manager shall use its best
efforts to obtain for the Fund the most favorable price and execution
available, except to the extent it may be permitted to pay higher
brokerage commissions for brokerage and research services as described
below. In using its best efforts to obtain for the Fund the most
favorable price and execution available, the Manager, bearing in mind
the Fund's best interests at all times, shall consider all factors it
deems relevant, including by way of illustration, price, the size of the
transaction, the nature of the market for the security, the amount of
the commission, the timing of the transaction taking into account market
prices and trends, the reputation, experience and financial stability of
the broker or dealer involved and the quality of service rendered by the
broker or dealer in other transactions. Subject to such policies as the
Trustees of the Fund may determine, the Manager shall not be deemed to
have acted unlawfully or to have breached any duty created by this
Contract or otherwise solely by reason of its having caused the Fund to
pay a broker or dealer that provides brokerage and research services to
the Manager an amount of commission for effecting a portfolio investment
transaction 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 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 Manager's overall responsibilities with respect to
the Fund and to other clients of the Manager as to which the Manager
exercises investment discretion. The Manager agrees that in connection
with purchases or sales of portfolio investments for the Fund's account,
neither the Manager nor any officer, director, employee or agent of the
Manager shall act as a principal or receive any commission other than as
provided in Section 3.
(d) The Fund will pay or reimburse the Manager for the compensation in
whole or in part of such officers of the Fund and persons assisting them
as may be determined from time to time by the Trustees of the Fund. The
Fund will also pay or reimburse the Manager for all or part of the cost
of suitable office space, utilities, support services and equipment
attributable to such officers and persons, as may be determined in each
case by the Trustees of the Fund. The Fund will pay the fees, if any,
of the Trustees of the Fund.
(e) The Manager shall pay all expenses incurred in connection with the
organization of the Fund and the initial public offering and sale of its
shares of beneficial interest, provided that upon the issuance and sale
of such shares to the public pursuant to the offering, and only in such
event, the Fund shall become liable for, and to the extent requested
reimburse the Manager for, registration fees payable to the Securities
and Exchange Commission and for an additional amount not exceeding
$125,000 as its agreed share of such expenses.
(f) The Manager shall not be obligated to pay any expenses of or for the
Fund not expressly assumed by the Manager pursuant to this Section 1
other than as provided in Section 3.
2. OTHER AGREEMENTS, ETC.
It is understood that any of the shareholders, Trustees, officers and
employees of the Fund may be a shareholder, director, officer or
employee of, or be otherwise interested in, the Manager, and in any
person controlled by or under common control with the Manager, and that
the Manager and any person controlled by or under common control with
the Manager may have an interest in the Fund. It is also understood
that the Manager and any person controlled by or under common control
with the Manager have and may have advisory, management, service or
other contracts with other organizations and persons, and may have other
interests and business.
3. COMPENSATION TO BE PAID BY THE FUND TO THE MANAGER.
The Fund will pay to the Manager as compensation for the Manager's
services rendered, for the facilities furnished and for the expenses
borne by the Manager pursuant to paragraphs (a), (b), (c) and (e) of
Section 1, a fee, computed and paid quarterly at the following annual
rates for each series of the Fund (except for Xxxxxx International Fund
2000 and Xxxxxx Floating Rate Daily Access Fund which shall be computed
and paid monthly):
Xxxxxx International Growth and Income Fund
(a) 0.80% of the first $500 million of the average net asset value of
each series;
(b) 0.70% of the next $500 million of such average net asset value;
(c) 0.65% of the next $500 million of such average net asset value;
(d) 0.60% of the next $5 billion of such average net asset value;
(e) 0.575% of the next $5 billion of such average net asset value;
(f) 0.555% of the next $5 billion of such average net asset value;
(g) 0.54% of the next $5 billion of such average net asset value; and
(h) 0.53% of any excess thereafter.
Xxxxxx Small Cap Growth Fund and Xxxxxx International Fund 2000
(a) 1.00% of the first $500 million of the average net asset value of
each series;
(b) 0.90% of the next $500 million of such average net asset value;
(c) 0.85% of the next $500 million of such average net asset value;
(d) 0.80% of the next $5 billion of such average net asset value;
(e) 0.775% of the next $5 billion of such average net asset value;
(f) 0.755% of the next $5 billion of such average net asset value;
(g) 0.74% of the next $5 billion of such average net asset value; and
(h) 0.73% of any excess thereafter.
Xxxxxx Growth Fund
(a) 0.70% of the first $500 million of the average net asset value of
each series;
(b) 0.60% of the next $500 million of such average net asset value;
(c) 0.55% of the next $500 million of such average net asset value;
(d) 0.50% of the next $5 billion of such average net asset value;
(e) 0.475% of the next $5 billion of such average net asset value;
(f) 0.455% of the next $5 billion of such average net asset value;
(g) 0.44% of the next $5 billion of such average net asset value; and
(h) 0.43% of any excess thereafter.
Xxxxxx Floating Rate Daily Access Fund
(a) 0.65% of the first $500 million of the average net asset value of
each series;
(b) 0.55% of the next $500 million of such average net asset value;
(c) 0.50% of the next $500 million of such average net asset value;
(d) 0.45% of the next $5 billion of such average net asset value;
(e) 0.425% of the next $5 billion of such average net asset value;
(f) 0.405% of the next $5 billion of such average net asset value;
(g) 0.39% of the next $5 billion of such average net asset value;
(h) 0.38% of the next $5 billion of such average net asset value;
(i) 0.37% of the next $5 billion of such average net asset value;
(j) 0.36% of the next $5 billion of such average net asset value;
(k) 0.35% of the next $5 billion of such average net asset value;
(l) 0.34% of the next $5 billion of such average net asset value;
(m) 0.33% of the next $8.5 billion of such average net asset value; and
(n) 0.32% of any excess thereafter.
Such average net asset value shall be determined by taking an average of
all of the determinations of such net asset value during such quarter or
month as the case may be, at the close of business on each business day
during such quarter or month while this Contract is in effect. Such fee
shall be payable for each fiscal quarter or month within 30 days after
the close of such quarter or within 15 days after the close of such
month (except for Xxxxxx International Fund 2000 and Floating Rate Daily
Access Fund, which will be payable for each fiscal month within 30 days
after the close of such month) and shall commence accruing as of the
date of the initial issuance of shares of the Fund to the public.
The fees payable by the Fund to the Manager pursuant to this Section 3
shall be reduced by any commissions, fees, brokerage or similar payments
received by the Manager or any affiliated person of the Manager in
connection with the purchase and sale of portfolio investments of the
Fund, less any direct expenses approved by the Trustees incurred by the
Manager or any affiliated person of the Manager in connection with
obtaining such payments.
In the event that expenses of the Fund or any series of the Fund for any
fiscal year should exceed the expense limitation on investment company
expenses imposed by any statute or regulatory authority of any
jurisdiction in which shares of the Fund or such series are qualified
for offer or sale, the compensation due the Manager for such fiscal year
shall be reduced by the amount of excess by a reduction or refund
thereof. In the event that the expenses of the Fund or any series of
the Fund exceed any expense limitation which the Manager may, by written
notice to the Fund, voluntarily declare to be effective subject to such
terms and conditions as the Manager may prescribe in such notice, the
compensation due the Manager shall be reduced, and, if necessary, the
Manager shall assume expenses of the Fund or such series to the extent
required by the terms and conditions of such expense limitation.
If the Manager shall serve for less than the whole of a quarter or
month, the foregoing compensation shall be prorated.
4. ASSIGNMENT TERMINATES THIS CONTRACT; AMENDMENTS OF THIS CONTRACT.
This Contract shall automatically terminate, without the payment of any
penalty, in the event of its assignment; and this Contract shall not be
amended as to any series of the Fund unless such amendment be approved
at a meeting by the affirmative vote of a majority of the outstanding
shares of such series, and by the vote, cast in person at a meeting
called for the purpose of voting on such approval, of a majority of the
Trustees of the Fund who are not interested persons of the Fund or of
the Manager.
5. EFFECTIVE PERIOD AND TERMINATION OF THIS CONTRACT.
This Contract shall become effective upon its execution, and shall
remain in full force and effect as to a particular series continuously
thereafter (unless terminated automatically as set forth in Section 4)
until terminated as follows:
(a) Either party hereto may at any time terminate this Contract as to
any series by not more than sixty days' nor less than thirty days'
written notice delivered or mailed by registered mail, postage prepaid,
to the other party, or
(b) If (i) the Trustees of the Fund or the shareholders by the
affirmative vote of a majority of the outstanding shares of such series,
and (ii) a majority of the Trustees of the Fund who are not interested
persons of the Fund or of the Manager, by vote cast in person at a
meeting called for the purpose of voting on such approval, do not
specifically approve at least annually the continuance of this Contract
with respect to such series, then this Contract shall automatically
terminate with respect to such series at the close of business on the
second anniversary of its execution with respect to such series, or upon
the expiration of one year from the effective date of the last such
continuance, whichever is later.
Action by the Fund under (a) above may be taken either (i) by vote of a
majority of its Trustees, or (ii) by the affirmative vote of a majority
of the outstanding shares of the relevant series.
Termination of this Contract pursuant to this Section 5 will be without
the payment of any penalty.
6. CERTAIN DEFINITIONS.
For the purposes of this Contract, the "affirmative vote of a majority
of the outstanding shares" of a series means the affirmative vote, at a
duly called and held meeting of shareholders of such series, (a) of the
holders of 67% or more of the shares of such series present (in person
or by proxy) and entitled to vote at such meeting, if the holders of
more than 50% of the outstanding shares of such series entitled to vote
at such meeting are present in person or by proxy, or (b) of the holders
of more than 50% of the outstanding shares of such series entitled to
vote at such meeting, whichever is less.
For the purposes of this Contract, the terms "affiliated person",
"control", "interested person" and "assignment" shall have their
respective meanings defined in the Investment Company Act of 1940 and
the Rules and Regulations thereunder (the "1940 Act"), subject, however,
to such exemptions as may be granted by the Securities and Exchange
Commission under said Act; the term "specifically approve at least
annually" shall be construed in a manner consistent with the 1940 Act,
and the Rules and Regulations thereunder; and the term "brokerage and
research services" shall have the meaning given in the Securities
Exchange Act of 1934 and the Rules and Regulations thereunder.
7. NON-LIABILITY OF MANAGER.
In the absence of willful misfeasance, bad faith or gross negligence on
the part of the Manager, or reckless disregard of its obligations and
duties hereunder, the Manager shall not be subject to any liability to
the Fund or to any shareholder of the Fund, for any act or omission in
the course of, or connected with, rendering services hereunder.
8. LIMITATION OF LIABILITY OF THE TRUSTEES, OFFICERS, AND
SHAREHOLDERS.
A copy of the Agreement and Declaration of Trust of the Fund is on file
with the Secretary of State of The Commonwealth of Massachusetts, and
notice is hereby given that this instrument is executed on behalf of the
Trustees of the Fund as Trustees and not individually and that the
obligations of or arising out of this instrument are not binding upon
any of the Trustees, officers or shareholders individually but are
binding only upon the assets and property of the relevant series of the
Fund.
IN WITNESS WHEREOF, XXXXXX FUNDS TRUST and XXXXXX INVESTMENT MANAGEMENT,
LLC have each caused this instrument to be signed in duplicate in its
behalf by its President or a Vice President thereunto duly authorized,
all as of the day and year first above written.
XXXXXX FUNDS TRUST
By: _______________________________________
Xxxxxxx X. Xxxxxx
Executive Vice President
XXXXXX INVESTMENT MANAGEMENT, LLC
By: _______________________________________
Xxxxxx X. Silver
Senior Managing Director
