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Exhibit 5.5
MASTER INVESTMENT TRUST, SERIES I
INVESTMENT ADVISORY AGREEMENT
THIS AGREEMENT is made as of _________, 1998 between MASTER INVESTMENT
TRUST, SERIES I, a Delaware business trust (herein called the "Trust"), and BANK
OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION (the "Adviser").
WHEREAS, the Trust is registered as an open-end management investment
company under the Investment Company Act of 1940, as amended ("1940 Act"); and
WHEREAS, the Trust desires to retain the Adviser to furnish investment
advisory services to the investment portfolios of the Trust listed on Schedule A
and any other investment portfolios which may be organized in the future and
listed on Schedule A (the "Portfolios");
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, it is agreed between the parties hereto as follows:
1. APPOINTMENT.
(a) The Trust hereby appoints the Adviser to act as investment
adviser to each Portfolio for the period and on the terms set forth in this
Agreement. The Adviser accepts such appointment and agrees to furnish the
services herein set forth for the compensation herein provided. The Adviser may,
in its discretion, provide such services through its own employees or the
employees of one or more affiliated companies that are qualified to act as
investment adviser to the Trust under applicable law and are under the common
control of BankAmerica Corporation provided (i) that all persons, when providing
services hereunder, are functioning as part of an organized group of persons,
and (ii) that such organized group of persons is managed at all times by
authorized officers of the Adviser.
(b) In the event that the Trust establishes one or more
investment portfolios other than the Portfolios with respect to which it desires
to retain the Adviser to act as investment adviser hereunder, it shall notify
the Adviser in writing. If the Adviser is willing to render such services under
this Agreement it shall so notify the Trust in writing whereupon such investment
portfolio shall become a "Portfolio" hereunder and shall be subject to the
provisions of this Agreement to the same extent as the Portfolios except to the
extent that said provisions (including those relating to the compensation
payable by the Portfolios to the Adviser) are modified with respect to such
Portfolio in writing by the Trust and the Adviser at the time.
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The Portfolios and any additional investment portfolios established hereunder in
accordance with this paragraph are sometimes collectively referred to herein as
the "Portfolios" and individually as a "Portfolio."
2. SERVICES. Subject to the supervision of the Trust's Board of
Trustees (the "Board"), the Adviser, in consultation with any Sub-Adviser
appointed pursuant to Section 3 hereof with respect to a particular Portfolio,
will provide a continuous investment program for each of the Portfolios,
including investment research and management with respect to all securities and
investments and cash equivalents in the Portfolios. The Adviser will determine
from time to time what securities and other investments will be purchased,
retained or sold by the Trust with respect to each Portfolio. The Adviser will
provide the services under this Agreement in accordance with each Portfolio's
investment objective, policies and restrictions as stated in the Trust's
registration statement, as from time to time amended, and resolutions of the
Board. The Adviser further agrees that it:
(a) Will conform with all applicable rules and regulations of the
Securities and Exchange Commission and will in addition conduct its activities
under this Agreement in accordance with other applicable law, including but not
limited to banking law.
(b) Will review, monitor and report to the Board of Trustees regarding
the performance and investment procedures of any Sub-Adviser (as defined in
Section 3 of this Agreement).
(c) Will assist and consult with any Sub-Adviser appointed with respect
to a particular Portfolio in connection with that Portfolio's continuous
investment program (as defined in Section 3 of this Agreement).
(d) Will place all orders for the purchase and sale of portfolio
securities for the account of each Portfolio with brokers or dealers selected by
the Adviser. In executing portfolio transactions and selecting brokers or
dealers, the Adviser will use its best efforts to seek on behalf of the Trust
and each Portfolio the best overall terms available. In assessing the best
overall terms available for any transaction the Adviser shall consider all
factors it deems relevant, including the breadth of the market in the security,
the price of the security, the financial condition and execution capability of
the broker or dealer, and the reasonableness of the commission, if any, both for
the specific transaction and on a continuing basis. In evaluating the best
overall terms available, and in selecting the broker or
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dealer to execute a particular transaction, the Adviser may also consider the
brokerage and research services (as those terms are defined in Section 28(e) of
the Securities Exchange Act of 1934, as amended) provided to any Portfolio
and/or other accounts over which the Adviser or any affiliate of the Adviser
exercises investment discretion. The Adviser is authorized, subject to the prior
approval of the Board, to negotiate and pay to a broker or dealer who provides
such brokerage and research services a commission for executing a portfolio
transaction for any Portfolio which is in excess of the amount of commission
another broker or dealer would have charged for effecting that transaction if,
but only if, the Adviser determines in good faith that such commission was
reasonable in relation to the value of the brokerage and research services
provided by such broker or dealer viewed in terms of that particular transaction
or in terms of the overall responsibilities of the Adviser to the particular
Portfolio and to the Trust. No prior approval by the Board, however, shall be
required so long as the broker or dealer selected by the Adviser obtains best
execution on a particular transaction. In no instance will portfolio securities
be purchased from or sold to the Adviser, any Sub-Adviser or any administrator
of the Trust, or an affiliated person of any of them acting as principal or as
broker, except as permitted by law. In executing portfolio transactions for any
Portfolio, the Adviser may, but shall not be obligated to, to the extent
permitted by applicable laws and regulations, aggregate the securities to be
sold or purchased with those of other Portfolios and its other clients where
such aggregation is not inconsistent with the policies set forth in the Trust's
registration statement. In such event, the Adviser will allocate the securities
so purchased or sold, and the expenses incurred in the transaction, pursuant to
any applicable law or regulation and in the manner it considers to be the most
equitable and consistent with its fiduciary obligations to the Portfolios and
such other clients.
In performing the investment advisory services hereunder, the Adviser
is authorized to purchase, sell or otherwise deal with securities or other
instruments for which (a) the Adviser, (b) any affiliate of the Adviser, (c) an
entity in which the Adviser or an affiliate of the Adviser has a direct or
indirect interest, or (d) another member of a syndicate or other intermediary
(where an entity referred to in (a), (b) or (c) above was a member of the
syndicate), has acted, now acts or in the future will act as an underwriter,
syndicate member, market-maker, dealer, broker or in any other similar capacity,
whether the purchase, sale or other dealing occurs during the life of the
syndicate or after the close of the syndicate, provided such purchase, sale or
dealing is permitted under the 1940 Act and the rules thereunder. Insofar as
permitted by law any rules of or under applicable law prohibiting or restricting
in any way an agent or fiduciary from dealing with itself or from dealing with
respect to any matter in which it may or does have a personal interest shall not
apply to the Adviser, to the extent its actions are authorized under this
paragraph.
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(e) Will maintain all books and records with respect to the securities
transactions for the Portfolios, keep books of account with respect to such
Portfolios and furnish the Board such periodic special reports as the Board may
request.
(f) Will maintain a policy and practice of conducting its investment
advisory operations independently of its commercial banking operations. When the
Adviser makes investment recommendations for a Portfolio, its investment
advisory personnel will not inquire or take into consideration whether the
issuer of securities proposed for purchase or sale for the Portfolio's account
are customers of its commercial department. In dealing with commercial
customers, the Adviser's commercial department will not inquire or take into
consideration whether securities of those customers are held by the Portfolios.
(g) Will treat confidentially and as proprietary information of the
Trust all records and other information relative to the Trust and prior or
present Trust shareholders or those persons or entities who respond to inquiries
concerning investment in the Trust, and will not use such records and
information for any purpose other than performance of its responsibilities and
duties hereunder or under any other agreement with the Trust except after prior
notification to and approval in writing by the Trust, which approval shall not
be unreasonably withheld and may not be withheld where the Adviser may be
exposed to civil or criminal contempt proceedings for failure to comply, when
requested to divulge such information by duly constituted authorities, or when
so requested by the Trust. Nothing contained herein, however, shall prohibit the
Adviser from advertising to or soliciting the public generally with respect to
other products or services, including, but not limited to, any advertising or
marketing via radio, television, newspapers, magazines or direct mail
solicitation, regardless of whether such advertisement or solicitation may
coincidentally include prior or present Trust shareholders or those persons or
entities who have responded to inquiries regarding the Trust.
3. SUB-ADVISER. It is understood that the Adviser may from time to time
employ or associate with itself such person or persons as the Adviser believes
to be fitted to assist it in the performance of this Agreement (each a
"Sub-Adviser"); provided, however, that the compensation of such person or
persons shall be paid by the Adviser and that the Adviser shall be as fully
responsible to the Trust for the acts and omissions of any such person as it is
for its own acts and omissions; and provided further, that the retention of any
Sub-Adviser shall be approved as may be required by the 1940 Act.
Notwithstanding any such employment or association, the Adviser shall itself (a)
establish
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and monitor general investment criteria and policies for such
Portfolio involved, (b) review and analyze on a periodic basis such Portfolio's
portfolio holdings and transactions in order to determine their appropriateness
in light of the Portfolio's shareholder base, and (c) review and analyze on a
periodic basis the policies established by any Sub-Adviser for such Portfolio
with respect to the placement of orders for the purchase and sale of portfolio
securities. In the event that any Sub-Adviser appointed hereunder is terminated,
the Adviser may provide investment advisory services pursuant to this Agreement
to the Portfolios without further shareholder approval.
4. SERVICES NOT EXCLUSIVE. The Adviser will for all purposes herein be
deemed to be an independent contractor and will, unless otherwise expressly
provided herein or authorized by the Board from time to time, have no authority
to act for or represent the Trust in any way or otherwise be deemed its agent.
The investment management services furnished by the Adviser hereunder are not
deemed exclusive, and the Adviser will be free to furnish similar services to
others so long as its services under this Agreement are not impaired thereby.
5. BOOKS AND RECORDS. In compliance with the requirements of Rule 31a-3
under the 1940 Act, the Adviser hereby agrees that all records which it
maintains for the Trust are the property of the Trust and further agrees to
surrender promptly to the Trust any such records upon the Trust's request. The
Adviser further agrees to preserve for the periods prescribed by Rule 31a-2
under the 1940 Act the records required to be maintained by Rule 31-1 under the
1940 Act.
6. EXPENSES. During the term of this Agreement, the Adviser will pay
all expenses incurred by it in connection with its activities under the
Agreement other than the cost of securities (including brokerage commissions, if
any) purchased for the Trust.
7. COMPENSATION. For the services provided and the expenses assumed
pursuant to this Agreement, the Trust will pay the Adviser and the Adviser will
accept as full compensation therefor a fee, computed daily and paid monthly (in
arrears) for the Portfolios at the annual rates set forth on Schedule B. Such
fee as is attributable to a Portfolio will be a separate charge to each such
Portfolio and will be the several (and not joint or joint and several)
obligation of each such Portfolio.
8. LIMITATION OF LIABILITY. Subject to the provisions of Section 3
hereof concerning the Adviser's responsibility for the
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acts and omissions of persons employed by or associated with the Adviser, the
Adviser will not be liable for any error of judgment or mistake of law or for
any loss suffered by the Trust in connection with the performance of this
Agreement, except a loss resulting from a breach of fiduciary duty with respect
to the receipt of compensation for services or a loss resulting from willful
misfeasance, bad faith or negligence on the part of the Adviser in the
performance of its duties or from reckless disregard by it of its obligations
and duties under this Agreement.
9. DURATION AND TERMINATION. This Agreement will become effective
with respect to each Portfolio as of the date first above written, provided that
the shareholders of each such Portfolio have previously approved the Agreement
in accordance with the requirements of the 1940 Act. This Agreement will become
effective with respect to any additional Portfolio on the date of receipt by the
Trust of notice from the Adviser in accordance with Section 1(b) hereof that the
Adviser is willing to serve as investment adviser with respect to such
Portfolio, provided that this Agreement (as supplemented by the terms specified
in any notice and agreement pursuant to Section 1(b) hereof) shall have been
approved by the shareholders of such Portfolio in accordance with the
requirements of the 1940 Act.
Unless sooner terminated as provided herein, this Agreement will
continue in effect until October 31, 1999. Thereafter, if not terminated, this
Agreement shall continue in effect as to a particular Portfolio for successive
annual periods, provided such continuance is specifically approved at least
annually (a) by the vote of a majority of those members of the Board who are not
interested persons of any party to this Agreement, cast in person at a meeting
called for the purpose of voting on such approval, and (b) by the Board or by
vote of a majority of the outstanding voting securities of such Portfolio.
Notwithstanding the foregoing, this Agreement may be terminated as to any
Portfolio at any time, without the payment of any penalty, by the Trust (by vote
of the Board or by vote of a majority of the outstanding voting securities of
such Portfolio), or by the Adviser, on sixty days' written notice. This
Agreement will immediately terminate in the event of its assignment. (As used in
this Agreement, the terms "majority of the outstanding voting securities,"
"interested persons" and "assignment" shall have the same meaning as the meaning
of such terms in the 1940 Act.)
10. AMENDMENT OF THIS AGREEMENT. No provision of this Agreement 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. No amendment of this Agreement will be
effective as to
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a particular Portfolio until approved by vote of a majority of the outstanding
voting securities of such Portfolio.
11. NOTICES. Notices of any kind to be given to the Adviser hereunder by
the Trust will be in writing and will be duly given if mailed or delivered to
the Adviser at 000 Xxxxxxxxxx Xxxxxx, Xxx Xxxxxxxxx, Xxxxxxxxxx 00000, or at
such other address or to such individuals as will be so specified by the Adviser
to the Trust. Notices of any kind to be given to the Trust hereunder by the
Adviser will be in writing and will be duly given if mailed or delivered to the
Trust at PFPC International, Ltd., 00 Xxxxxxxx Xxxxxx, Xxxxxx 0, Xxxxxxx (with a
copy to Xxxxxx X. Xxxxxxx, XxXxxxxxx & Xxxxxxx, 000 Xxxxx Xxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxxxx 00000-0000), or at such other address or to such
individual as will be so specified by the Trust to the Adviser.
12. MISCELLANEOUS. The captions in this Agreement are included for
convenience of reference only and in no way define or limit any of the
provisions hereof or otherwise affect their construction or effect. If any
provision of this Agreement shall be held or made invalid by a court decision,
statute, rule or otherwise, the remainder of this Agreement will not be affected
thereby. This Agreement will be binding upon and will inure to the benefit of
the parties hereto and their respective successors and will be governed by the
internal laws, and not the law of conflicts, of the State of Delaware; provided
that nothing herein will be construed in a manner inconsistent with the 1940
Act, the Investment Advisers Act of 1940, as amended, or any rule or regulation
of the Securities and Exchange Commission thereunder. This Agreement may be
executed in two or more parts which together shall constitute a single
Agreement.
13. NAMES. The names "Master Investment Trust, Series I" and "Trustees of
Master Investment Trust, Series I" refer respectively to the Trust created and
the Trustees, as trustees but not individually or personally, acting from time
to time under a Declaration of Trust dated October 23, 1992, as amended and
restated on February 10, 1993, as amended on August 15, 1993 and October 22,
1993 and as amended and restated on April 29, 1998, which is hereby referred to
and a copy of which is on file at the principal office of the Trust. The
Trustees, officers, employees and agents of the Trust shall not personally be
bound by or liable under any written obligation, contract, instrument,
certificate or other interest or undertaking of the Trust made by the Trustees
or by an officer, employee or agent of the Trust, in his or her capacity as
such, nor shall resort be had to their private property for the satisfaction of
any obligation or claim thereunder.
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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.
MASTER INVESTMENT TRUST, SERIES I
By:
--------------------------------
Name:
Title: President
BANK OF AMERICA NATIONAL
TRUST & SAVINGS ASSOCIATION
By:
--------------------------------
Name:
Title:
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Schedule A
Portfolios
Investment Grade Bond
Blue Chip
Utilities
Growth and Income
International Bond Portfolios
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Schedule B
Fee as a Percentage
Portfolio of Net Assets
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Investment Grade Bond .30%
Utilities .50%
Blue Chip .50%
Growth and Income .55%
International Bond .55%
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