EXHIBIT (d)(4)
ARTISAN FUNDS, INC.
ARTISAN SMALL CAP VALUE FUND
INVESTMENT ADVISORY AGREEMENT
Artisan Funds, Inc., a Wisconsin corporation registered under the
Investment Company Act of 1940 ("1940 Act") as an open-end diversified
management investment company ("Artisan Funds"), and Artisan Partners Limited
Partnership, a Delaware limited partnership registered under the Investment
Advisers Act of 1940 as an investment adviser ("Artisan Partners"), agree
that:
1. ENGAGEMENT OF ARTISAN PARTNERS. Artisan Partners shall manage the
investment and reinvestment of the assets of Artisan Small Cap Value Fund, a
series of Artisan Funds ("the Fund"), subject to the supervision of the board
of directors of Artisan Funds, for the period and on the terms set forth in this
agreement. Artisan Partners shall give due consideration to the investment
policies and restrictions and the other statements concerning Fund in Artisan
Fund's articles of incorporation, bylaws, and registration statements under the
1940 Act and the Securities Act of 1933 ("1933 Act"), and to the provisions of
the Internal Revenue Code applicable to Fund as a regulated investment company.
Artisan Partners shall be deemed for all purposes to be an independent
contractor and not an agent of Artisan Funds or the Fund, and unless otherwise
expressly provided or authorized, shall have no authority to act or represent
Artisan Funds or the Fund in any way.
Artisan Partners is authorized to make the decisions to buy and sell
securities, options and futures contracts for the Fund, to place the Fund's
portfolio transactions with broker-dealers, and to negotiate the terms of such
transactions including brokerage commissions on brokerage transactions, on
behalf of the Fund. Artisan Partners is authorized to exercise discretion
within the Fund's policy concerning allocation of its portfolio brokerage, as
permitted by law, including but not limited to section 28(e) of the Securities
Exchange Act of 1934, and in so doing shall not be required to make any
reduction in its investment advisory fees.
Artisan Partners represents that it will notify Artisan Funds of any
change in the membership of Artisan Partners within a reasonable time after any
such change.
2. EXPENSES TO BE PAID BY ARTISAN PARTNERS. Artisan Partners shall
furnish to Artisan Funds, at its own expense, office space and all necessary
office facilities, equipment and personnel for managing that portion of Artisan
Funds' business relating to the Fund. Artisan Partners shall also assume and
pay all other expenses incurred by it in connection with managing the assets of
the Fund, all expenses of marketing shares of the Fund, all expenses of
placement of securities orders and related bookkeeping and one-half of all fees,
dues and other expenses related to membership of Artisan Funds in any trade
association or other investment company organization.
3. EXPENSES TO BE PAID BY ARTISAN FUNDS. Artisan Funds shall pay all
charges of depositories, custodians and other agencies for the safekeeping and
servicing of its cash, securities and other property and of its transfer agents
and registrars and its dividend disbursing and redemption agents, if any; all
expenses in determination of daily price computations; all charges of legal
counsel and of independent accountants; all compensation of directors other than
those affiliated with Artisan Partners and all expenses incurred in connection
with their services to Artisan Funds; all costs of borrowing money; all expenses
of publication of notices and reports to its shareholders and to governmental
bodies or regulatory agencies; all expenses of proxy solicitations of the Fund
or of the board of directors of the Artisan Funds; all expenses of shareholder
meetings; all expenses of typesetting of the Fund's prospectus
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and of printing and mailing copies of the prospectus furnished to each
then-existing shareholder or beneficial owner; all taxes and fees payable to
federal, state or other governmental agencies, domestic or foreign, all stamp or
other taxes; all expenses of printing and mailing certificates for shares of the
Fund; all expenses of bond and insurance coverage required by law or deemed
advisable by Artisan Funds' board of directors; all expenses of qualifying and
maintaining qualification of shares of the Fund under the securities laws of
such United States jurisdictions as the Artisan Funds may from time to time
reasonably designate and all expenses of maintaining the registration of Artisan
Funds under the 1933 Act, the 1940 Act and one-half of all fees, dues and other
expenses related to membership of Artisan Funds in any trade association or
other investment company organization. In addition to the payment of expenses,
the Fund also shall pay all brokers' commissions and other charges relative to
the purchase and sale of portfolio securities for the Fund. Any expenses borne
by Artisan Funds that are attributable solely to the organization, operation or
business of the Fund shall be paid solely out of the Fund's assets. Any expense
borne by Artisan Funds that is not solely attributable to the Fund, nor solely
to any other series of shares of Artisan Funds, if applicable, shall be
apportioned in such manner as Artisan Partners determines is fair and
appropriate, or as otherwise specified by the board of directors of Artisan
Funds.
4. COMPENSATION OF ARTISAN PARTNERS. For the services to be rendered
and the charges and expenses to be assumed and to be paid by Artisan Partners
hereunder, the Fund shall pay to Artisan Partners a monthly fee at the annual
rate of 1% of the Fund's average daily net assets up to $500 million; .975 of 1%
of average daily net assets from $500 million to $750 million; .950 of 1% of
average daily net assets from $750 million to $1 billion and .925 of 1% of
average daily net assets over $1 billion.
5. SERVICES OF ARTISAN PARTNERS NOT EXCLUSIVE. The services of
Artisan Partners to the Fund hereunder are not to be deemed exclusive, and
Artisan Partners shall be free to render similar services to others so long as
its services under this agreement are not impaired by such other activities.
6. SERVICES OTHER THAN AS INVESTMENT ADVISER. Artisan Partners (or
an affiliate of Artisan Partners) may act as broker for the Fund in connection
with the purchase or sale of securities by or to the Fund if and to the extent
permitted by procedures adopted from time to time by the board of directors of
Artisan Funds. Such brokerage services are not within the scope of the duties
of Artisan Partners under this agreement, and, within the limits permitted by
law and the board of directors of Artisan Funds, Artisan Partners (or an
affiliate of Artisan Partners) may receive brokerage commissions, fees or other
remuneration from the Fund for such services in addition to its fee for services
as Artisan Partners. Within the limits permitted by law, Artisan Partners may
receive compensation from the Fund for other services performed by it for the
Fund which are not within the scope of the duties of Artisan Partners under this
agreement.
7. LIMITATION OF LIABILITY OF ARTISAN PARTNERS. Artisan Partners
shall not be liable to Artisan Funds or its shareholders for any loss suffered
by Artisan Funds or its shareholders from or as a consequence of any act or
omission of Artisan Partners, or of any of the partners, employees or agents of
Artisan Partners, in connection with or pursuant to this agreement, except by
reason of willful misfeasance, bad faith or gross negligence on the part of
Artisan Partners in the performance of its duties or by reason of reckless
disregard by Artisan Partners of its obligations and duties under this
agreement.
8. DURATION AND RENEWAL. Unless terminated as provided in Section
10, this agreement shall continue in effect until April 30, 1999, and thereafter
from year to year only so long as such continuance is specifically approved at
least annually (a) by a majority of those directors who are not interested
persons of Artisan Funds or of Artisan Partners, voting in person at a meeting
called for the purpose of voting on such approval, and (b) by either the board
of directors of Artisan Funds or vote of
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the holders of a "majority of the outstanding shares of the Fund" (which term as
used throughout this agreement shall be construed in accordance with the
definition of "vote of a majority of the outstanding voting securities of a
company" in section 2(a)(42) of the 1940 Act).
9. TERMINATION. This agreement may be terminated at any time,
without payment of any penalty, by the board of directors of Artisan Funds, or
by a vote of the holders of a majority of the outstanding shares of the Fund,
upon 60 days' written notice to Artisan Partners. This agreement may be
terminated by Artisan Partners at any time upon 60 days' written notice to
Artisan Fund. This agreement shall terminate automatically in the event of its
assignment (as defined in Section 2(a)(4) of the 1940 Act).
10. NON-LIABILITY OF DIRECTORS AND SHAREHOLDERS. Any obligation of
Artisan Funds hereunder shall be binding only upon the assets of Artisan Funds
(or applicable series thereof) and shall not be binding upon any director,
officer, employee, agent or shareholder of Artisan Funds. Neither the
authorization of any action by the directors or shareholders of Artisan Funds
nor the execution of this agreement on behalf of Artisan Funds shall impose any
liability upon any director, officer or shareholder of Artisan Partners.
11. AMENDMENT. This agreement may not be amended without the
affirmative vote (a) of a majority of those directors who are not "interested
persons" (as defined in section 2(a)(19) of the 1940 Act) of Artisan Fund or of
Artisan Partners, voting in person at a meeting called for the purpose of voting
on such approval, and (b) of the holders of a majority of the outstanding shares
of the Fund.
Dated: August 20, 1997
ARTISAN FUNDS, INC.
By: /s/Xxxxxx X. Xxxxxxx
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ARTISAN PARTNERS LIMITED PARTNERSHIP
By: Artisan Investment Corporation
Its general partner
By: /s/ Xxxxxx X. Xxxxxxx
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Xxxxxx X. Xxxxxxx
President
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