Exhibit No. 4
INVESTMENT ADVISORY AND ADMINISTRATION CONTRACT
Contract made as of July 31, 1998 between XXXXXXXX XXXXXXXX
INSTITUTIONAL SERIES, a Delaware business trust ("Trust"), and XXXXXXXX XXXXXXXX
ASSET MANAGEMENT INC. ("Xxxxxxxx Xxxxxxxx"), a Delaware corporation registered
as a broker-dealer under the Securities Exchange Act of 1934, as amended ("1934
Act"), and as an investment adviser under the Investment Advisers Act of 1940,
as amended.
WHEREAS the Trust is registered under the Investment Company Act of
1940, as amended ("1940 Act"), as an open-end management investment company, and
intends to offer for public sale distinct series of shares of beneficial
interest ("Series"), each corresponding to a distinct portfolio; and
WHEREAS the Trust desires to retain Xxxxxxxx Xxxxxxxx as investment
adviser and administrator to furnish certain administrative, investment advisory
and portfolio management services to the Trust and each Series as now exists and
as hereafter may be established (provided that the Board of Trustees ("Board")
approves the applicability of this Contract to such subsequent Series), and
Xxxxxxxx Xxxxxxxx is willing to furnish such services;
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, it is agreed between the parties hereto as follows:
1. Appointment. The Trust hereby appoints Xxxxxxxx Xxxxxxxx as
investment adviser and administrator of the Trust and each Series for the period
and on the terms set forth in this Contract. Xxxxxxxx Xxxxxxxx accepts such
appointment and agrees to render the services herein set forth, for the
compensation herein provided.
2. Duties as Investment Adviser.
(a) Subject to the supervision of the Board, Xxxxxxxx Xxxxxxxx will
provide a continuous investment program for each Series, including investment
research and management with respect to all securities and investments and cash
equivalents in each Series. Xxxxxxxx Xxxxxxxx will determine from time to time
what securities and other investments will be purchased, retained or sold by
each Series.
(b) Xxxxxxxx Xxxxxxxx agrees that in placing orders with brokers, it
will attempt to obtain the best net result in terms of price and execution;
provided that, on behalf of any Series, Xxxxxxxx Xxxxxxxx may, in its
discretion, use brokers who provide the Series with research, analysis, advice
and similar services to execute portfolio transactions on behalf of the Series,
and Xxxxxxxx Xxxxxxxx may pay to those brokers in return for brokerage and
research services a higher commission than may be charged by other brokers,
subject to Xxxxxxxx Xxxxxxxx' determining in good faith that such commission is
reasonable in terms either of the particular transaction or of the overall
responsibility of Xxxxxxxx Xxxxxxxx to such Series and its other clients and
that the total commissions paid by such Series will be reasonable in relation to
the benefits to the Series over the
long term. In no instance will portfolio securities be purchased from or sold to
Xxxxxxxx Xxxxxxxx, or any affiliated person thereof, except in accordance with
the federal securities laws and the rules and regulations thereunder. Whenever
Xxxxxxxx Xxxxxxxx simultaneously places orders to purchase or sell the same
security on behalf of a Series and one or more other accounts advised by
Xxxxxxxx Xxxxxxxx, such orders will be allocated as to price and amount among
all such accounts in a manner believed to be equitable to each account. The
Trust recognizes that in some cases this procedure may adversely affect the
results obtained for the Series.
(c) Xxxxxxxx Xxxxxxxx will oversee the maintenance of all books and
records with respect to the securities transactions of each Series, and will
furnish the Board with such periodic and special reports as the Board reasonably
may request. In compliance with the requirements of Rule 31a-3 under the 1940
Act, Xxxxxxxx Xxxxxxxx hereby agrees that all records which it maintains for the
Trust are the property of the Trust, agrees to preserve for the periods
prescribed by Rule 31a-2 under the 1940 Act any records which it maintains for
the Trust and which are required to be maintained by Rule 31a-1 under the 1940
Act and further agrees to surrender promptly to the Trust any records which it
maintains for the Trust upon request by the Trust.
(d) Xxxxxxxx Xxxxxxxx will oversee the computation of the net asset
value and the net income of each Series as described in the currently effective
registration statement of the Trust under the Securities Act of 1933, as
amended, and the 1940 Act and any supplements thereto ("Registration Statement")
or as more frequently requested by the Board.
(e) The Trust hereby authorizes Xxxxxxxx Xxxxxxxx and any entity or
person associated with Xxxxxxxx Xxxxxxxx which is a member of a national
securities exchange to effect any transaction on such exchange for the account
of any Series, which transaction is permitted by Section 11(a) of the 1934 Act,
and the Trust hereby consents to the retention of compensation by Xxxxxxxx
Xxxxxxxx or any person or entity associated with Xxxxxxxx Xxxxxxxx.
3. Duties as Administrator. Xxxxxxxx Xxxxxxxx will administer the
affairs of the Trust and each Series subject to the supervision of the Board and
the following understandings:
(a) Xxxxxxxx Xxxxxxxx will supervise all aspects of the operations of
the Trust and each Series, including oversight of transfer agency, custodial and
accounting services, except as hereinafter set forth; provided, however, that
nothing herein contained shall be deemed to relieve or deprive the Board of its
responsibility for and control of the conduct of the affairs of the Trust and
each Series.
(b) Xxxxxxxx Xxxxxxxx will provide the Trust and each Series with such
corporate, administrative and clerical personnel (including officers of the
Trust) and services as are reasonably deemed necessary or advisable by the
Board, including the maintenance of certain books and records of the Trust and
each Series.
(c) Xxxxxxxx Xxxxxxxx will arrange for the periodic preparation,
updating, filing and dissemination (as applicable) of the Trust's Registration
Statement, proxy material, tax returns and required reports to each Series'
shareholders and the Securities and Exchange Commission and other appropriate
federal or state regulatory authorities.
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(d) Xxxxxxxx Xxxxxxxx will provide the Trust and each Series with, or
obtain for it, adequate office space and all necessary office equipment and
services, including telephone service, heat, utilities, stationery supplies and
similar items.
(e) Xxxxxxxx Xxxxxxxx will provide the Board on a regular basis with
economic and investment analyses and reports and make available to the Board
upon request any economic, statistical and investment services normally
available to institutional or other customers of Xxxxxxxx Xxxxxxxx.
4. Further Duties. In all matters relating to the performance of this
Contract, Xxxxxxxx Xxxxxxxx will act in conformity with the Trust Instrument,
By-Laws and Registration Statement of the Trust and with the instructions and
directions of the Board and will comply with the requirements of the 1940 Act,
the rules thereunder, and all other applicable federal and state laws and
regulations.
5. Delegation of Xxxxxxxx Xxxxxxxx' Duties as Investment Adviser and
Administrator. With respect to any or all Series, Xxxxxxxx Xxxxxxxx may enter
into one or more contracts ("Sub-Advisory or Sub-Administration Contract") with
a sub-adviser or sub-administrator in which Xxxxxxxx Xxxxxxxx delegates to such
sub-adviser or sub-administrator any or all its duties specified in Paragraphs 2
and 3 of this Contract, provided that each Sub-Advisory or Sub-Administration
Contract imposes on the sub-adviser or sub-administrator bound thereby all
applicable duties and conditions to which Xxxxxxxx Xxxxxxxx is subject by
Paragraphs 2, 3 and 4 of this Contract, and further provided that each
Sub-Advisory or Sub-Administration Contract meets all requirements of the 1940
Act and rules thereunder.
6. Services Not Exclusive. The services furnished by Xxxxxxxx Xxxxxxxx
hereunder are not to be deemed exclusive and Xxxxxxxx Xxxxxxxx shall be free to
furnish similar services to others so long as its services under this Contract
are not impaired thereby. Nothing in this Contract shall limit or restrict the
right of any director, officer or employee of Xxxxxxxx Xxxxxxxx, who may also be
a Trustee, officer or employee of the Trust, to engage in any other business or
to devote his or her time and attention in part to the management or other
aspects of any other business, whether of a similar nature or a dissimilar
nature.
7. Expenses.
(a) Xxxxxxxx Xxxxxxxx will bear all expenses incurred in the operation
of each Series to which this Contract is applicable, including the Series'
allocable share of the expenses of the Trust, other than (i) the investment and
advisory fee payable under this Contract, (ii) the fees payable pursuant to any
Shareholder Service Plan adopted by the Trust with respect to the Series or a
class of shares of the Series, (iii) fees and expenses of the Independent
Trustees (defined in paragraph 10(a) below), including counsel fees of the
Independent Trustees, (iv) interest, taxes and the cost (including brokerage
commissions and other transaction costs, if any) of securities purchased or sold
by the Series and any losses incurred in connection therewith and (v)
extraordinary expenses (such as costs of litigation to which the Trust or a
Series is a party and of indemnifying officers and Trustees of the Trust), which
will be borne by the Trust or Series, as applicable.
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(b) The expenses to be borne by Xxxxxxxx Xxxxxxxx include the following
(or each Series' proportionate share of the following): (i) expenses of
organizing the Trust and the Series; (ii) filing fees and expenses relating to
the registration and qualification of the Series' shares and the Trust under
federal and/or state securities laws and maintaining such registration and
qualifications; (iii) fees and salaries payable to the Trust's Trustees and
officers; (iv) all expenses incurred in connection with the services of Trustees
other than the Independent Trustees, including travel expenses; (v) costs of any
liability, uncollectible items of deposit and other insurance and fidelity
bonds; (vi) legal, accounting and auditing expenses, other than the legal fees
of special counsel for the Independent Trustees; (vii) charges of custodians,
transfer agents and other agents (including any lending agent); (viii) costs of
preparing share certificates; (ix) expenses of setting in type and printing
prospectuses and supplements thereto, statements of additional information and
supplements thereto, reports and proxy materials for existing shareholders; (x)
costs of mailing prospectuses and supplements thereto, statements of additional
information and supplements thereto, reports and proxy materials to existing
shareholders; (xi) fees, voluntary assessments and other expenses incurred in
connection with membership in investment company organizations; (xii) the cost
of mailing and tabulating proxies and costs of meetings of shareholders, the
Board and any committees thereof; (xii) the cost of investment company
literature and other publications provided by the Trust to its Trustees and
officers; (xiii) costs of mailing, stationery and communications equipment;
(xiv) expenses incident to any dividend, withdrawal or redemption options; (xv)
charges and expenses of any outside pricing service used to value portfolio
securities; and (xvi) interest on borrowings of the Fund.
(c) The payment or assumption by Xxxxxxxx Xxxxxxxx of any expenses of
the Trust or a Series that Xxxxxxxx Xxxxxxxx is not required by this Contract to
pay or assume shall not obligate Xxxxxxxx Xxxxxxxx to pay or assume the same or
any similar expense of the Trust or a Series on any subsequent occasion.
8. Compensation.
(a) For the services provided and the expenses assumed pursuant to this
Contract, with respect to the Trust's existing Series, Xxxxxxxx Xxxxxxxx LIR
Select Money Fund, the Trust will pay to Xxxxxxxx Xxxxxxxx a fee, computed daily
and paid monthly, at an annual rate of 0.18% of such Series' average daily net
assets less that Series' allocable share of the accrued fees and expenses of the
Independent Trustees (including counsel fees of the Independent Trustees).
(b) For the services provided and the expenses assumed pursuant to this
Contract with respect to any Series hereafter established and for which the
Board approves the applicability of this Contract, the Trust will pay to
Xxxxxxxx Xxxxxxxx from the assets of such Series a fee in an amount to be agreed
upon in a written fee agreement ("Fee Agreement") executed by the Trust on
behalf of such Series and by Xxxxxxxx Xxxxxxxx. All such Fee Agreements shall
provide that they are subject to all terms and conditions of this Contract.
(c) The fee shall be computed daily and paid monthly to Xxxxxxxx
Xxxxxxxx on or before the first business day of the next succeeding calendar
month.
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(d) If this Contract becomes effective or terminates before the end of
any month, the fee for the period from the effective day to the end of the month
or from the beginning of such month to the date of termination, as the case may
be, shall be prorated according to the proportion which such period bears to the
full month in which such effectiveness or termination occurs.
9. Limitation of Liability of Xxxxxxxx Xxxxxxxx. Xxxxxxxx Xxxxxxxx and
its delegates, including any Sub-Adviser or Sub-Administrator to any Series or
the Trust, shall not be liable for any error of judgment or mistake of law or
for any loss suffered by any Series, the Trust or any of its shareholders, in
connection with the matters to which this Contract relates, except to the extent
that such a loss results from willful misfeasance, bad faith or gross negligence
on its part in the performance of its duties or from reckless disregard by it of
its obligations and duties under this Contract. Any person, even though also an
officer, director, employee, or agent of Xxxxxxxx Xxxxxxxx, who may be or become
an officer, Trustee, employee or agent of the Trust shall be deemed, when
rendering services to any Series or the Trust or acting with respect to any
business of such Series or the Trust, to be rendering such service to or acting
solely for the Series or the Trust and not as an officer, director, employee, or
agent or one under the control or direction of Xxxxxxxx Xxxxxxxx even though
paid by it.
10. Duration and Termination.
(a) This Contract shall become effective upon the date hereabove
written provided that, with respect to any Series, this Contract shall not take
effect unless it has first been approved (i) by a vote of a majority of those
Trustees of the Trust who are not parties to this Contract or interested persons
of any such party ("Independent Trustees") cast in person at a meeting called
for the purpose of voting on such approval, and (ii) by vote of a majority of
that Series' outstanding voting securities.
(b) Unless sooner terminated as provided herein, this Contract shall
continue in effect for two years from the above written date. Thereafter, if not
terminated, this Contract shall continue automatically for successive periods of
twelve months each, provided that such continuance is specifically approved at
least annually (i) by a vote of a majority of the Independent Trustees, cast in
person at a meeting called for the purpose of voting on such approval, and (ii)
by the Board or, with respect to any given Series, by vote of a majority of the
outstanding voting securities of such Series.
(c) Notwithstanding the foregoing, with respect to any Series this
Contract may be terminated at any time, without the payment of any penalty, by
vote of the board or by a vote of a majority of the outstanding voting
securities of such Series on sixty days' written notice to Xxxxxxxx Xxxxxxxx or
by Xxxxxxxx Xxxxxxxx at any time, without the payment of any penalty, on sixty
days' written notice to the Trust. Termination of this Contract with respect to
any given Series shall in no way affect the continued validity of this Contract
or the performance thereunder with respect to any other Series. This Contract
will automatically terminate in the event of its assignment.
11. Limitation of Liability of the Trustees, Officers and Shareholders
of the Trust. The Trustees and officers of the Trust and the shareholders of any
Series shall not be liable for any
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obligations of any Series or the Trust under this Contract, and Xxxxxxxx
Xxxxxxxx agrees that, in asserting any rights or claims under this Contract, it
shall look only to the assets and property of the Trust in settlement of such
right or claim, and not to such Trustees, officers or shareholders.
12. Amendment of this Contract. No provision of this Contract 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 of this Contract as to any
given Series shall be effective until approved by vote of a majority of such
Series' outstanding voting securities.
13. Governing Law. This Contract shall be construed in accordance with
the laws of the State of Delaware, without giving effect to the conflicts of
laws principles thereof, and in accordance with the 1940 Act. To the extent that
the applicable laws of the State of Delaware conflict with the applicable
provisions of the 1940 Act, the latter shall control.
14. Miscellaneous. The captions in this Contract 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. If any
provision of this Contract shall be held or made invalid by a court decision,
statute, rule or otherwise, the remainder of this Contract shall not be affected
thereby. This Contract shall be binding upon and shall inure to the benefit of
the parties hereto and their respective successors. As used in this Contract,
the terms "majority of the outstanding voting securities", "affiliated person",
"interested person", "assignment", "broker", "investment adviser", "national
securities exchange", "net assets", "prospectus", "sale", "sell" and "security"
shall have the same meaning as such terms have in the 1940 Act and the rules and
regulations thereunder, subject to such exemptions as may be granted by the
Securities and Exchange Commission. Where the effect of a requirement of the
1940 Act reflected in any provision of this Contract is relaxed by a rule,
regulation, order or other action of the Securities and Exchange Commission,
whether of special or general application, such provision shall be deemed to
incorporate the effect of such rule, regulation, order or other action.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be executed by their officers and delivered as of the day and year first above
written.
Attest: XXXXXXXX XXXXXXXX ASSET MANAGEMENT INC.
/s/ Xxxxx Xxxxx By: /s/ Xxxxx X. Xxxxxx
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First Vice President First Vice President
Attest: XXXXXXXX XXXXXXXX INSTITUTIONAL SERIES
/s/ Xxxxxx Xxxxxxx By: /s/ Xxxxxx X. X'Xxxxxxx
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Assistant Secretary Vice President and Secretary
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