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INVESTMENT MANAGEMENT AGREEMENT
Agreement, made this 1st day of May, 2000, between American Odyssey
Funds, Inc., a Maryland corporation (the "Series Fund"), and American Odyssey
Funds Management LLC, a New Jersey limited liability company (the "Manager").
WHEREAS, the Series Fund is a diversified, open-end management investment
company registered under the Investment Company Act of 1940, as amended (the
"1940 Act"); and
WHEREAS, the Series Fund is currently divided into six separate series
(each a "Fund"), each of which is established pursuant to a resolution of the
Board of Directors of the Series Fund, and the Series Fund may in the future add
additional Funds; and
WHEREAS, the Series Fund desires to retain the Manager to render, or
contract to obtain as hereinafter provided, investment advisory services to the
Series Fund and also to avail itself of the facilities available to the Manager
with respect to the administration of the Series Fund's day to day business
affairs; and
WHEREAS, the Manager is willing to render such investment advisory and
administrative services;
NOW, THEREFORE, the parties agree as follows:
1. The Series Fund hereby appoints the Manager to act as manager of
the Series Fund and administrator of its business affairs for the period and on
the terms set forth in this Agreement. The Manager accepts such appointment and
agrees to render the services described below for the compensation provided in
paragraph 9. The Manager is authorized to enter into Subadvisory agreements for
investment advisory services in connection with the management of each of the
Funds of the Series Fund (the "Subadvisory agreements"), provided that no such
contract shall be made until it has been approved by the Board of Directors of
the Series Fund. The Series Fund shall be a party to each such agreement. Any
such agreement may be entered into by the Manager on such terms and in such
manner as may be permitted by paragraph 9(b) and by the 1940 Act and the rules
thereunder (subject to any applicable exemptions). The Manager will continue to
have supervisory responsibility for all investment advisory services furnished
pursuant to any such Subadvisory agreements. The Manager will review the
performance of all Subadvisers, determine the allocation of assets among the
Subadvisers, and make recommendations to the Board of Directors with respect to
the retention and renewal of such Subadvisory agreements.
2. Subject to the supervision of the Board of Directors and,
subject to paragraph 1 hereof, the Manager shall manage the operations of the
Series Fund and each Fund thereof. More particularly:
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(a) The Manager, in the performance of its duties and
obligations under this Agreement, shall act in conformity with the
Articles of Incorporation, By-Laws, Prospectus, and Statement of
Additional Information of the Series Fund and with the instructions and
directions of the Board of Directors of the Series Fund and will conform
to and comply with the requirements of the 1940 Act and all other
applicable federal and state laws and regulations.
(b) The Manager will monitor the performance of each of the
Subadvisers and will be generally responsible for their activities. The
Manager shall meet periodically with each Subadviser to review and agree
upon its current investment strategies and programs in the light of
anticipated cash flows. The Manager shall periodically provide the Board
of Directors with evaluations of the performance of the Subadvisers and
shall make recommendations concerning the renewal or termination of the
Subadvisory contracts.
(c) For any Fund with more than one Subadviser, the Manager is
authorized to determine the allocation of Fund assets among the
Subadvisers.
(d) The Manager shall provide the Board of Directors of the
Series Fund such periodic and special reports as the Board may reasonably
request.
(e) The Manager shall be responsible for the financial and
accounting records maintained by the Series Fund, other than those being
maintained by the Series Fund's custodian or accounting services agent.
(f) The Manager shall provide, or cause to be provided, to the
Series Fund's custodian on each business day all information relating to
the transactions in the securities owned, purchased, or sold by each
Fund.
(g) The Manager shall provide such staff assistance as the
Board of Directors of the Series Fund shall reasonably request in
connection with the conduct of meetings of the Board and otherwise.
(h) The investment management services of the Manager to the
Series Fund under this Agreement are not to be deemed exclusive, and the
Manager shall be free to render investment advisory services to others.
3. The Series Fund has delivered to the Manager copies of each of the
following documents and will deliver to it all future amendments and
supplements, if any:
(a) The Articles of Incorporation of the Series Fund, as filed
with the Secretary of State of Maryland;
(b) The By-Laws of the Series Fund;
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(c) Certified resolutions of the Board of Directors of the
Series Fund authorizing the appointment of the Manager and approving the
form of this Agreement;
(d) The Notification of Registration of the Series Fund under
the 1940 Act on Form N-8A as filed with the Securities and Exchange
Commission (the "Commission");
(e) The Registration Statement under the 1940 Act and the
Securities Act of 1933, as amended, on Form N-1A (the "Registration
Statement"), as filed with the Commission relating to the Series Fund and
shares of the Series Fund and all amendments thereto; and
(f) The Prospectus and Statement of Additional Information of
the Series Fund as currently in effect and as amended or supplemented
from time to time.
4. The Manager shall authorize and permit any of its directors,
officers, and employees who may be elected as members of the Board of Directors
or officers of the Series Fund to serve in the capacities in which they are
elected. All services to be furnished by the Manager under this Agreement may be
furnished through the medium of any such directors, officers, or employees of
the Manager.
5. The Manager shall keep the Series Fund's books and records
required to be maintained by it pursuant to paragraph 2 hereof. The Manager
agrees that all records which it maintains for the Series Fund are the property
of the Series Fund and it will surrender promptly to the Series Fund any such
records upon the Series Fund's request, provided however that the Manager may
retain a copy of such records. The Manager further agrees to preserve for the
periods prescribed by Rule 31a-2 under the 1940 Act (or any successor provision)
any such records as are required to be maintained by the Manager pursuant to
paragraph 2 hereof.
6. During the term of this Agreement, the Manager shall pay the
following expenses:
(i) the salaries and expenses of all personnel of the Series
Fund and the Manager except the fees and expenses of members of the Board
of Directors who are not interested persons of the Series Fund, as that
term is defined in the 1940 Act;
(ii) all expenses incurred by the Manager or by the Series
Fund in connection with managing the ordinary course of the Series Fund's
business, other than those stated below that will be paid by the Series
Fund; and
(iii) expenses incurred in connection with meetings of the Board
of Directors of the Series Fund, including such staff assistance as the
Board shall reasonably request, but not including the fees and expenses
of directors of the Series Fund who are not interested persons of the
Series Fund, as that term is defined in the 1940 Act.
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7. The Series Fund will pay the expenses described below:
(a) the fees and expenses incurred by the Series Fund in
connection with the management of the investment and reinvestment of each
Fund's assets, including the fees described in paragraph 9;
(b) brokers' commissions and any issue or transfer taxes
chargeable to the Series Fund in connection with its securities, options,
and futures transactions;
(c) the fees and expenses of directors of the Series Fund who
are not interested persons of the Series Fund, as that term is defined in
the 1940 Act;
(d) the fees and expenses of the Series Fund's custodian(s) or
accounting services agent(s) that relate to (I) the custodial function
and the recordkeeping connected therewith, (ii) preparing and maintaining
the general accounting records of the Series Fund (other than those
relating to the shares and shareholder accounts of the Series Fund) and
the providing of any such records to the Manager useful to the Manager in
connection with the Manager's responsibility for the accounting records
of the Series Fund pursuant to Section 31 of the 1940 Act and the rules
promulgated thereunder, and (iii) the pricing of the shares of the Series
Fund, including the cost of any pricing service or services which may be
retained pursuant to the authorization of the directors of the Series
Fund;
(e) the charges and expenses of legal counsel and independent
accountants for the Series Fund;
(f) all taxes and corporate fees payable by the Series Fund to
federal, state, and other governmental agencies;
(g) the fees of any trade associations of which the Series Fund
may be a member;
(h) the cost of fidelity, directors and officers, and errors
and omissions insurance;
(i) the fees and expenses involved in registering and
maintaining registration of the Series Fund and of its shares with the
Commission, and qualifying its shares, to the extent required, under
state securities laws, including the preparation and printing of the
Series Fund's registration statements, prospectuses and statements of
additional information for filing under federal and state securities
laws;
(j) communications expenses with respect to investor services
and expenses of preparing, printing, and mailing reports to shareholders
in the amount necessary for distribution to the shareholders;
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(k) all expenses incurred in connection with the holding of
shareholder meetings; and
(l) litigation and indemnification expenses and other
extraordinary expenses not incurred in the ordinary course of the Series
Fund's business.
8. In the event the expenses of the Series Fund for any fiscal year
(including the fees payable to the Manager but excluding interest, taxes,
brokerage commissions and litigation and indemnification expenses and other
extraordinary expenses not incurred in the ordinary course of the Series Fund's
business) exceed the lowest applicable annual expense limitation established and
enforced pursuant to the statute or regulations of any jurisdictions in which
shares of the Series Fund are then qualified for offer and sale, the
compensation due the Manager will be reduced by the amount of such excess, and,
if such reduction exceeds the compensation payable to the Manager, the Manager
will pay to the Series Fund the amount of such reduction which exceeds the
amount of such compensation.
9. (a) For the services provided and the expenses assumed pursuant to
this Agreement, the Series Fund shall pay to the Manager as full compensation
therefor a fee at an annual rate of 0.25% of each Fund's average daily net
assets. The fee shall be computed daily and shall be paid to the Manager monthly
as of the first business day of the next succeeding calendar month. Any
reduction in the fee payable and any payment by the Manager to the Fund pursuant
to paragraph 8 shall be made monthly. Any such reductions or payments are
subject to readjustment during the year. The Series Fund shall pay the fee
described in this subparagraph (a) in addition to the subadvisory fees the
Series Fund pays pursuant to subparagraph (b).
(b) The Series Fund shall pay to each subadviser the fee
set forth in the respective subadvisory agreement, which shall specify a fee
rate or rates based upon the average daily net assets allocated to that
subadviser; provided, however, that the annual fee rate for a subadviser shall
not exceed the maximum annual fee rates specified below:
Maximum annual subadviser fee rate as a
percentage of average daily net assets
allocated to the subadviser
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Fund
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American Odyssey Core Equity Fund 0.45%
American Odyssey Emerging Opportunities Fund 0.80%
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American Odyssey International Equity Fund 0.55%
American Odyssey Global High-Yield Bond Fund 0.525%
American Odyssey Long-Term Bond Fund 0.35%
American Odyssey Intermediate-Term Bond Fund 0.35%
10. The Manager shall not be liable for any loss suffered by the
Series Fund as the result of any negligent act or error of judgment of the
Manager in connection with the matters to which this Agreement relates, except a
loss resulting from a breach of fiduciary duty with respect to the receipt of
compensation for services (in which case any award of damages shall be limited
to the period and the amount set forth in Section 36(b)(3) of the 0000 Xxx) or
loss resulting 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 Agreement. The Series Fund shall indemnify the
Manager and hold it harmless from all cost, damage and expense, including
reasonable expenses for legal counsel, incurred by the Manager resulting from
actions for which it is relieved of responsibility by this paragraph. The
Manager shall indemnify the Series Fund and hold it harmless from all cost,
damage and expense, including reasonable expenses for legal counsel, incurred by
the Series Fund resulting from actions for which the Manager is not relieved of
responsibility by this paragraph.
11. The words "American Odyssey" and the design set forth in Appendix
A hereto (the "Design") are service marks of the Manager. The Manager hereby
grants to the Series Fund a license to use the words "American Odyssey" in the
Series Fund's corporate name, "American Odyssey Funds, Inc.," and a license to
use the words "American Odyssey" and the Design in connection with the Series
Fund's operations as an investment company. This license is granted on a
royalty-free basis. The Manager retains the right to use, or license the use of,
the words "American Odyssey" and any derivative thereof, as well as the Design,
in connection with any other business enterprise. If the holders of the
outstanding voting securities of any Fund fail to approve this Agreement, or if
at any time after such approval the Manager ceases to be investment manager of
any Fund, the Manager shall have the absolute right to terminate the license
herein granted forthwith upon written notice to the Series Fund. Upon
termination of the license herein granted, the Series Fund shall immediately
change its corporate name to one which does not include the words "American
Odyssey" or any derivative thereof, and will discontinue all use by it of the
words "American Odyssey," the Design or anything resembling the Design, in
connection with its business. The terms of the license herein granted shall
inure to the benefit of and be binding upon any successors or assigns of the
Series Fund or the Manager.
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12. This Agreement shall continue in effect for a period of more than
two years from the date hereof only so long as such continuance is specifically
approved at least annually in conformity with the requirements of the 1940 Act;
provided, however, that this Agreement may be terminated by the Series Fund
without the payment of any penalty, by the Board of Directors of the Series Fund
or by vote of a majority of the Series Fund's outstanding voting securities (as
defined in the 1940 Act), or by the Manager at any time, without the payment of
any penalty, on not more than 60 days' nor less than 30 days' written notice to
the other party. This Agreement shall terminate automatically in the event of
its assignment (as defined in the 1940 Act).
13. Nothing in this Agreement shall limit or restrict the right of
any director, officer, or employee of the Manager who may also be a director,
officer, or employee of the Series Fund 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 business, whether of a similar or dissimilar nature, nor limit or
restrict the right of the Manager to engage in any other business or to render
services of any kind to any other corporation, firm, individual, or association.
14. Except as otherwise provided herein or authorized by the Board of
Directors of the Series Fund from time to time, the Manager shall for all
purposes herein be deemed to be an independent contractor and shall have no
authority to act for or represent the Series Fund in any way or otherwise be
deemed an agent of the Series Fund.
15. During the term of this Agreement, the Series Fund agrees to
furnish the Manager at its principal office all prospectuses, proxy statements,
reports to shareholders, sales literature, or other material prepared for
distribution to shareholders of the Series Fund or the public, which refer in
any way to the Manager, prior to use thereof and not to use such material if the
Manager reasonably objects in writing within five business days (or such other
time as may be mutually agreed) after receipt thereof. In the event of
termination of this Agreement, the Series Fund will continue to furnish to the
Manager copies of any of the above mentioned materials which refer in any way to
the Manager. Sales literature may be furnished to the Manager hereunder by first
class mail, overnight delivery service, facsimile transmission equipment, or
hand delivery. The Series Fund shall furnish or otherwise make available to the
Manager such other information relating to the business affairs of the Series
Fund as the Manager at any time, or from time to time, reasonably requests in
order to discharge its obligations hereunder.
16. This Agreement may be amended by mutual consent, but the consent
of the Series Fund must be obtained in conformity with the requirements of the
1940 Act.
17. Any notice or other communication required to be given pursuant
to this Agreement shall be deemed duly given if delivered or mailed by certified
or registered mail, return receipt requested and postage prepaid, (1) to
American Odyssey Funds Management LLC at Xxx Xxxxx Xxxxxx, Xxxx Xxxxxxxxx, XX
00000, Attention: Secretary; or (2) to American Odyssey Funds, Inc. at Xxx Xxxxx
Xxxxxx, Xxxx Xxxxxxxxx, XX 00000, Attention: President.
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18. This Agreement shall be governed by and construed in accordance
with the laws of the State of New Jersey.
19. This Agreement may be executed in two or more counterparts, which
taken together shall constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed by their officers designated below as of the day and year first above
written.
AMERICAN ODYSSEY FUNDS, INC.
By:
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Witness: Xxxx X. Xxxxxxxx Xxxx X. Xxxxxxxx
Secretary President
AMERICAN ODYSSEY FUNDS
MANAGEMENT LLC
By:
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Witness: Xxxx X. Xxxxxxxx Xxxx X. Xxxxxxxx
Assistant Secretary Senior Vice President
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