INVESTMENT ADVISORY CONTRACT
CONTRACT made this 8th day of September, 1998, between THE XXXXXX
MANAGED BLUE CHIP SERIES TRUST, a Massachusetts business trust (the "Trust"), on
behalf of CATHOLIC VALUES EQUITY INVESTMENT PORTFOLIO and other series of the
Trust which the Adviser (as defined below) and the Trust shall agree from time
to time are subject to this Contract, as set forth on Schedule A hereto
(collectively, the "Portfolios" and individually, the "Portfolio"), and XXXXXX
INVESTORS' SERVICE, INC., a Connecticut corporation (the "Adviser"):
1. Duties of the Adviser. The Trust hereby employs the Adviser to act
as investment adviser for and to manage the investment and reinvestment of the
assets of the Trust and, except as otherwise provided in an administration
agreement, to administer the Trust's affairs, subject to the supervision of the
Trust's Trustees, for the period and on the terms set forth in this Contract.
The Adviser hereby accepts such employment, and undertakes to afford to
the Trust the advice and assistance of the Adviser's organization in the choice
of investments and in the purchase and sale of securities for each Portfolio and
to furnish for the use of the Trust office space and all necessary office
facilities, equipment and personnel for servicing the investments of the
Portfolios and for administering the Trust's affairs and to pay the salaries and
fees of officers and Trustees of the Trust who are members of the Adviser's
organization and all personnel of the Adviser performing services relating to
research and investment activities. The Adviser shall for all purposes herein be
deemed to be an independent contractor and shall, except as otherwise expressly
provided or authorized, have no authority to act for or represent the Trust in
any way or otherwise be deemed an agent of the Trust.
The Adviser shall provide the Trust with such investment management and
supervision as the Trust may from time to time consider necessary for the proper
supervision of its Portfolios. As investment adviser to the Portfolios, the
Adviser 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 each Portfolio's assets shall be held uninvested, subject always to
the applicable restrictions of the Declaration of Trust, By-Laws and
registration statement of the Trust under the Investment Company Act of 1940,
all as from time to time amended. The Adviser is authorized, in its discretion
and without prior consultation with the Trust, but subject to each Portfolio's
investment objective, policies and restrictions, to buy, sell, lend and
otherwise trade in any stocks, bonds, options and other securities and
investment instruments on behalf of the Portfolios, to purchase, write or sell
options on securities, futures contracts or indices on behalf of the Portfolios,
to enter into commodities contracts on behalf of the Portfolios, including
contracts for the future delivery of securities or currency and futures
contracts on securities or other indices, and to execute any and all agreements
and instruments and to do any and all things incidental thereto in connection
with the management of the Portfolios. Should the Trustees of the Trust at any
time, however, make any specific determination as to investment policy for the
Portfolios and notify the Adviser thereof in writing, the Adviser 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 Adviser shall
take, on behalf of the Portfolios, all actions which it deems necessary or
desirable to implement the investment policies of the Trust and of each
Portfolio.
The Adviser shall place all orders for the purchase or sale of
portfolio securities for the account of a Portfolio with brokers or dealers
selected by the Adviser, and to that end the Adviser is authorized as the agent
of the Portfolio to give instructions to the custodian of the Portfolio as to
deliveries of securities and payments of cash for the account of a Portfolio or
the Trust. In connection with the selection of such brokers or dealers and the
placing of such orders, the Adviser shall use its best efforts to seek to
execute portfolio security transactions at prices which are advantageous to the
Portfolios and (when a disclosed commission is being charged) at reasonably
competitive commission rates. In selecting brokers or dealers qualified to
execute a particular transaction, brokers or dealers may be selected who also
provide brokerage and research services and products (as those terms are defined
in Section 28(e) of the Securities Exchange Act of 1934) to the Adviser. The
Adviser is expressly authorized to cause the Portfolios to pay any broker or
dealer who provides such brokerage and research service and products a
commission for executing a security transaction which is in excess of the amount
of commission another broker or dealer would have charged for effecting that
transaction if the Adviser 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, viewed in terms of either that
particular transaction or the overall responsibilities which the Adviser and its
affiliates have with respect to accounts over which they exercise investment
discretion. Subject to the requirement set forth in the second sentence of this
paragraph, the Adviser is authorized to consider, as a factor in the selection
of any broker or dealer with whom purchase or sale orders may be placed, the
fact that such broker or dealer has sold or is selling shares of the Portfolio
or the Trust or of other investment companies sponsored by the Adviser.
2. Compensation of the Adviser. For the services, payments and
facilities to be furnished hereunder by the Adviser, the Trust on behalf of each
Portfolio shall pay to the Adviser on the last day of each month a fee equal
(annually) to the percentage or percentages specified in Schedule B of the
average daily net assets of such Portfolio throughout the month, computed in
accordance with the Trust's Declaration of Trust, registration statement and any
applicable votes of the Trustees.
In case of the initiation or termination of the Contract during any
month with respect to any Portfolio, each Portfolio's fee for that month shall
be reduced proportionately on the basis of the number of calendar days during
which the Contract is in effect and the fee shall be computed upon the average
net assets for the business days the Contract is so in effect for that month.
The Adviser may, from time to time, agree not to impose all or a part
of the above compensation.
3. Allocation of Charges and Expenses. It is understood that the Trust
will pay all of its expenses other than those expressly stated to be payable by
the Adviser hereunder, which expenses payable by the Trust shall include,
without limitation (i) expenses of maintaining the Trust and continuing its
existence, (ii) registration of the Trust under the Investment Company Act of
1940, (iii) commissions, fees and other expenses connected with the purchase or
sale of securities, (iv) auditing, accounting and legal expenses, (v) taxes and
interest, (vi) governmental fees, (vii) expenses of issue, sale, repurchase and
redemption of shares, (viii) expenses of registering and qualifying the Trust
and its shares under federal and state securities laws and of preparing and
printing prospectuses for such purposes and for distributing the same to
shareholders and investors, and fees and expenses of registering and maintaining
the registration of the Trust and of the Trust's principal underwriter, if any,
as broker-dealer or agent under state securities laws, (ix) expenses of reports
and notices to shareholders and of meetings of shareholders and proxy
solicitations therefor, (x) expenses of reports to governmental officers and
commissions, (xi) insurance expenses, (xii) association membership dues, (xiii)
fees, expenses and disbursements of custodians and subcustodians for all
services to the Trust (including without limitation safekeeping of funds and
securities, keeping of books and accounts and determination of net asset value),
(xiv) fees, expenses and disbursements of transfer agents and registrars for all
services to the Trust, (xv) expenses for servicing shareholder accounts, (xvi)
any direct charges to shareholders approved by the Trustees of the Trust, (xvii)
compensation of and any expenses of Trustees of the Trust, (xviii) the charges
and expenses of the independent auditors, (xix) the charges and expenses of
legal counsel to the Trust and the Trustees; (xx) distribution fees, if any,
paid by a Portfolio in accordance with Rule 12b-1 under the 1940 Act, (xxi) the
administration fee payable to the Trust's administrator, and (xxii) such
nonrecurring items as may arise, including expenses incurred in connection with
litigation, proceedings and claims and the obligation of the Trust to indemnify
its Trustees and officers with respect thereto.
4. Other Interests. It is understood that Trustees, officers and
shareholders of the Trust are or may be or become interested in the Adviser as
directors, officers, employees, stockholders or otherwise and that directors,
officers, employees and stockholders of the Adviser are or may be or become
similarly interested in the Trust, and that the Adviser may be or become
interested in the Trust as a shareholder or otherwise. It is also understood
that directors, officers, employees and stockholders of the Adviser are or may
be or become interested (as directors, trustees, officers, employees,
stockholders or otherwise) in other companies or entities (including, without
limitation, other investment companies) which the Adviser may organize, sponsor
or acquire, or with which it may merge or consolidate, and which may include the
words "Xxxxxx" or "Xxxxxx Investors" or any combination thereof as part of their
names, and that the Adviser or its subsidiaries or affiliates may enter into
advisory or management agreements or other contracts or relationships with such
other companies or entities.
5. Limitation of Liability of the Adviser. The services of the Adviser
to the Trust are not to be deemed to be exclusive, the Adviser being free to
render services to others and engage in other business activities. In the
absence of willful misfeasance, bad faith, gross negligence or reckless
disregard of obligations or duties hereunder on the part of the Adviser, the
Adviser shall not be subject to liability to the Trust or to any shareholder of
the Trust for any act or omission in the course of, or connected with, rendering
services hereunder or for any losses which may be sustained in the purchase,
holding or sale of any security.
6. Sub-Investment Advisers. The Adviser may employ one or more
sub-investment advisers from time to time to perform such of the acts and
services of the Adviser, including the selection of brokers or dealers to
execute the Trust's portfolio security transactions, and upon such terms and
conditions as may be agreed upon between the Adviser and such sub-investment
adviser and approved by the Trustees.
7. Duration and Termination of this Contract. This Contract shall
become effective upon the date of its execution, and, unless terminated as
herein provided, shall remain in full force and effect as to each Portfolio to
and including February 28, 2000 and shall continue in full force and effect as
to each Portfolio indefinitely thereafter, but only so long as such continuance
after February 28, 2000 is specifically approved at least annually (i) the
Trustees of the Trust or by vote of a majority of the outstanding voting
securities of that Portfolio and (ii) by the vote of a majority of those
Trustees of the Trust who are not interested persons of the Adviser or (other
than as a Trustee) the Trust, in accordance with the requirements of the
Investment Company Act of 1940 as now in effect or as hereafter amended,
subject, however, to such exemptions as may be granted by the Securities and
Exchange Commission, by any rule, regulation, order or interpretive position.
Either party hereto may, at any time on sixty (60) days' prior written
notice to the other, terminate this Contract as to any Portfolio, without the
payment of any penalty, by action of its Board of Directors or Trustees, as the
case may be, and the Trust may, at any time upon such written notice to the
Adviser, terminate this Contract as to any Portfolio by vote of a majority of
the outstanding voting securities of that Portfolio. This Contract shall
terminate automatically in the event of its assignment.
8. Amendments of the Contract. This Contract may be amended as to any
Portfolio by a writing signed by both parties hereto, provided that no material
amendment to this Contract shall be effective as to that Portfolio until
approved (i) by the vote of a majority of those Trustees of the Trust who are
not interested persons of the Adviser or the Trust, and (ii) by vote of a
majority of the outstanding voting securities of that Portfolio in accordance
with the requirements of the Investment Company Act of 1940 as now in effect or
as hereafter amended, subject, however, to such exemptions as may be granted by
the Securities and Exchange Commission, by any rule, regulation, order or
interpretive position.
9. Limitation of Liability. The Adviser expressly acknowledges the
provision in the Declaration of Trust of the Trust limiting the personal
liability of shareholders of the Trust, and the Adviser hereby agrees that it
shall have recourse only to the Trust for payment of claims or obligations as
between the Trust and Adviser arising out of this Contract and shall not seek
satisfaction from the shareholders or any shareholder of the Trust. No Portfolio
shall be liable for the obligations of any other Portfolio hereunder.
10. Certain Definitions. The terms "assignment" and "interested
persons" when used herein shall have the respective meanings specified in the
Investment Company Act of 1940 as now in effect or as hereafter amended subject,
however, to such exemptions as may be granted by the Securities and Exchange
Commission by any rule, regulation, order or interpretive position. The term
"vote of a majority of the outstanding voting securities of that Portfolio"
shall mean the vote of the lesser of (a) 67 per centum or more of the shares of
the particular Portfolio present or represented by proxy at a meeting of
shareholders of the Portfolio if the holders of more than 50 per centum of the
outstanding shares of the particular Portfolio are present or represented by
proxy at the meeting, or (b) more than 50 per centum of the outstanding shares
of the particular Portfolio.
11. Use of the Name "Xxxxxx". The Adviser hereby consents to the use by
the Trust of the name "Xxxxxx" as part of the Trust's name and the name of each
Portfolio should the Trust desire to adopt such name in the future; provided,
however, that such consent shall be conditioned upon the employment of the
Adviser or one of its affiliates as the investment adviser of the Trust. The
name "Xxxxxx" or any variation thereof may be used from time to time in other
connections and for other purposes by the Adviser and its affiliates and other
investment companies that have obtained consent to use the name "Xxxxxx". The
Adviser shall have the right to require the Trust to cease using the name
"Xxxxxx" as part of the Trust's name and the name of each Portfolio if the Trust
ceases, for any reasons, to employ the Adviser or one of its affiliates as the
Trust's investment adviser. Future names adopted by the Trust for itself and its
Portfolios, insofar as such names include identifying words requiring the
consent of the Adviser, shall be the property of the Adviser and shall be
subject to the same terms and conditions.
CATHOLIC VALUES EQUITY INVESTMENT PORTFOLIO XXXXXX INVESTORS' SERVICES, INC.
By: By:
Xxxxx X. Xxxxxxx Xxxxxx X. Xxxxxxxx
SCHEDULE A
APPLICABLE SERIES
1. Catholic Values Equity Investment Portfolio
SCHEDULE B
ANNUAL ADVISORY FEE RATES
Under $500 Million
$500 to Over
Portfolio Million $1 Billion $1 Billion
Catholic Values Equity
Investment Portfolio 0.75% 0.73% 0.68%
