EXHIBIT 5(a)(vii)
INVESTMENT ADVISORY CONTRACT
HT Insight Funds, Inc. d/b/a Xxxxxx Insight Funds (the "Company"), a
Maryland Corporation registered under the Investment Company Act of 1940, as
amended (the "1940 Act"), as an open-end diversified management investment
company, and Xxxxxx Trust and Savings Bank, an Illinois bank (the "Adviser"),
agree as follows:
1. APPOINTMENT OF ADVISER. The Company appoints the Adviser to furnish
investment advisory and other services to the Company for its Hemisphere Free
Trade Fund, and the Adviser accepts that appointment, for the period and on the
terms set forth below. In the event that the Company establishes more portfolios
other than the Fund named above 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 notify the Company in writing whereupon such portfolio shall become a
Fund hereunder and shall be subject to the provisions of this Agreement to the
same extent as the Fund named above except to the extent that said provisions
(including those relating to the compensation payable by the Fund to the
Adviser) are modified with respect to such Fund in writing by the Company and
the Adviser at the time.
2. SERVICES OF ADVISER.
(a) INVESTMENT MANAGEMENT. Subject to the overall supervision and
control of the Board of Directors of the Company (the "Board of Directors"), the
Adviser shall have supervisory responsibility for the general management and
investment of the Fund's assets, giving due consideration to the investment
policies and restrictions, portfolio transaction policies and the other
statements concerning the Fund in the Company's Articles of Incorporation,
by-laws and registration statements under the 1940 Act and the Securities Act of
1933, as amended (the "1933 Act"), to the provisions of the 1933 Act and the
1940 Act and rules and regulations thereunder, to the provisions of the Internal
Revenue Code applicable to the Fund as a regulated investment company and to
other applicable law (the "Investment Policies and Restrictions"). It is
understood that the Adviser intends to enter into a portfolio management
contract (a "Portfolio Management Contract") with Xxxxxx Investment Management,
Inc. (the "Portfolio Management Agent"). The Portfolio Management Agent or any
successor to a Portfolio Management Agent shall have the responsibilities and
duties set forth in Section 3 below and in its respective Portfolio Management
Contract. As long as the Portfolio Management Contract is in effect, the
services provided by the Adviser will be limited to the supervision and
oversight of the Portfolio Management Agent's performance under the Portfolio
Management Contract.
(b) MONITORING PORTFOLIO MANAGEMENT AGENT. The Adviser shall monitor
and evaluate the investment performance of the Portfolio Management Agent; and
shall monitor the investment activities of the Portfolio Management Agent to
ensure compliance with the Investment Policies and Restrictions.
(c) REPORTS AND INFORMATION. The Adviser shall furnish to the Board of
Directors periodic reports on the investment strategy and performance of the
Funds and such additional reports and information as the Board of Directors or
the officers of the Company may reasonably request.
(d) CUSTOMERS OF FINANCIAL INSTITUTIONS. It is understood that the
Adviser may, but shall not be obligated to, provide, either directly or through
agents, administrative and other services with respect to shareholders who are
customers of the Adviser or its affiliates, including establishing shareholder
accounts, assisting the Company's transfer agent with respect to recording
purchase and redemption transactions, advising shareholders about the status of
their accounts, current yield and dividends declared and such related services
as the shareholders or the Fund may request. It is further understood that the
Adviser may, but shall not be obligated to, make payments from its own resources
to other financial institutions that provide similar services to shareholders of
the Fund that are customers of such institutions. Notwithstanding the foregoing,
the Adviser shall not provide any distribution services to the Company that the
Adviser is legally precluded from providing under the Xxxxx-Xxxxxxxx Act or
other applicable law.
(e) UNDERTAKINGS OF ADVISER. The Adviser further agrees that it will:
(i) Comply with the 1940 Act and with all applicable rules and
regulations of the Securities and Exchange Commission, the provisions of the
Internal Revenue Code relating to regulated investment companies, applicable
banking laws and regulations, and policy decisions and procedures adopted by the
Board of Directors from time to time;
(ii) Select broker-dealers in accordance with guidelines established by
the Board of Directors from time to time and in accordance with applicable law
(consistent with this obligation, when the execution and price offered by two or
more brokers or dealers are comparable, the Adviser may, in its discretion,
purchase and sell portfolio securities to and from brokers and dealers who
provide the Adviser with research advice and other services);
(iii) Maintain books and records with respect to the securities
transactions of the Fund; and
(iv) Treat confidentially and as proprietary information of the Company
all records and other information relative to the Company or to prior, present
or potential shareholders, and will not use such records or information for any
purpose other than in the performance of its responsibilities and duties
hereunder, except (A) after prior notification to and approval in writing by the
Company, which approval shall not be unreasonably withheld, (B) when so
requested by the Company, (C) as required by tax authorities or (D) pursuant to
a judicial request, requirement or order, provided that the Adviser takes
reasonable steps to provide the Company with prior notice in order to allow the
Company to contest such request, requirement or order.
(f) BOOKS AND RECORDS. In compliance with the requirements of Rule
31a-3 under the 1940 Act, the Adviser agrees that all records that it maintains
for the Company are the
property of the Company and further agrees to surrender promptly to the Company
any of such records upon the Company'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 31a-1 under the 1940 Act.
(g) INDEPENDENT CONTRACTOR. The Adviser shall for all purposes herein
be deemed to be an independent contractor and not an agent of the Company and
shall, unless otherwise expressly provided or authorized, have no authority to
act for or represent the Company in any way.
3. SERVICES OF PORTFOLIO MANAGEMENT AGENT. Subject to the overall
supervision and control of the Board of Directors and the Adviser and pursuant
to the terms of its Portfolio Management Contract, the Portfolio Management
Agent shall manage the investment and reinvestment of the Fund's assets giving
due consideration to the Investment Policies and Restrictions. The Adviser shall
not be responsible or liable for the investment merits of any decision by a
Portfolio Management Agent to purchase, hold or sell a security for the
portfolio of a Fund.
4. EXPENSES BORNE BY THE COMPANY. Except as otherwise provided in this
Agreement or any other contract to which the Company is a party, the Company
shall pay all expenses incidental to its organization, operations and business
including, without limitation: all charges of depositories, custodians,
sub-custodians and other agencies for the safekeeping and servicing of its cash,
securities and other property, and of its transfer, shareholder recordkeeping,
dividend disbursing and redemption agents, if any; all charges for equipment or
services used for obtaining price quotations; all charges for accounting
services provided to the Company by the custodian, the Adviser or any other
provider of accounting services; all expenses of portfolio pricing, net asset
value computation and reporting portfolio information to the Adviser or
Portfolio Management Agent; all charges for services of administration; all
charges of independent auditors and legal counsel; all compensation of the
Directors other than those affiliated with any entity providing advisory or
administrative services to the Company, and all expenses incurred in connection
with their services to the Company; all expenses of preparing, printing and
distributing notices, proxy solicitation material and reports to shareholders of
the Fund; all expenses of meetings of shareholders; all expenses of preparation
and printing of annual or more frequent and of supplying each then existing
shareholder or beneficial owner of shares of the Fund with a copy of a revised
prospectus; all expenses related to preparing and transmitting certificates
representing shares of the Fund, if any; all expenses of bond and insurance
coverage required by law or deemed advisable by the Board of Directors; all
costs of borrowing money; all taxes and corporate fees payable to Federal, state
or other governmental agencies, domestic or foreign; all stamp or other transfer
taxes; all expenses of registering and maintaining the registration of the
Company under the 1940 Act and of shares of the Fund under the 1933 Act, of
qualifying and maintaining qualification of the Company and of shares of the
Fund for sale under securities laws of various states or other jurisdictions and
of registration and qualification of the Trust under all other laws applicable
to the Company or its business activities; all payments pursuant to a plan
adopted on behalf of the Fund pursuant to Rule 12b-1 under the 1940 Act; all
fees, dues and other expenses incurred by the Company in connection
with membership of the Company in any trade association or other investment
company organization; and extraordinary expenses. In addition the Fund shall pay
all broker's commissions and other charges relating to the purchase and sale of
portfolio securities or other assets of the Fund.
5. ALLOCATION OF EXPENSES BORNE BY COMPANY. Any expenses borne by the
Company that are attributable solely to the organization, operation or business
of the Fund shall be paid solely out of assets of the Fund. Any expense borne by
the Company that is not solely attributable to the Fund, nor solely to any other
portfolio of the Company, shall be apportioned in such manner as the Company or
an administrator for the Company determines is fair and appropriate, or as
otherwise specified by the Board of Directors.
6. EXPENSES BORNE BY ADVISER. The Adviser at its own expense shall
furnish personnel, office space and office facilities and equipment required to
render its services pursuant to this Agreement and shall be responsible for
payment of the fees of the Portfolio Management Agent pursuant to the Portfolio
Management Contract (but the Adviser shall not be responsible for any expenses
such Portfolio Management Agent may incur in connection with their performance
of services for the Company).
7. COMPENSATION OF ADVISER. For the services to be rendered and the
expenses to be assumed and to be paid by the Adviser under this Agreement, the
Company shall pay to the Adviser a fee, computed and accrued daily and payable
on the first business day of each month, at an annual rate of 0.90% of the
average daily net assets of the Fund. Such fee is attributable to the Fund shall
be a separate charge to the Fund and shall be the several (and not joint or
joint and several) obligation of the Fund.
8. EXPENSE LIMITATION. If for any fiscal year of the Fund the total
expenses allocated to the Fund pursuant to paragraph 5 (including fees paid to
the Adviser and any other service provider but excluding taxes, interest,
commissions and other normal charges incident to the purchase and sale of
portfolio securities, extraordinary charges such as litigation costs, and
payments pursuant to a Fund's Rule 12b-1 Plan) exceed the most restrictive
applicable limits prescribed by any state in which shares of the Fund are then
being offered for sale to the public, the Adviser agrees to reimburse the
Company in an amount equal to such excess, provided that the Adviser shall not
be required to reimburse the Fund for any year in an amount greater than the
amount of fees received by it with respect to management of the Fund for that
year. Any such reimbursement by the Adviser, or refund by the Fund of an excess
reimbursement, shall be paid monthly on an estimated basis.
9. NON-EXCLUSIVITY. The services of the Adviser to the Company under
this Agreement are not to be deemed exclusive and the Adviser shall be free to
render similar services to others so long as its services under this Agreement
are not impaired by such other activities.
10. STANDARD OF CARE. Neither the Adviser, nor any Portfolio Management
Agent, nor any of their respective directors, officers, agents or employees
shall be liable or responsible
to the Company or its shareholders for any error of judgment, or any loss
arising out of any investment, or for any other act or omission in the
performance by the Adviser or a Portfolio Management Agent of its duties under
this Agreement or a Portfolio Management Contract, respectively, except for
liability resulting from willful misfeasance, bad faith or gross negligence on
the part of the Adviser or Portfolio Management Agent, respectively, or from
reckless disregard by the Adviser or the Portfolio Management Agent of its
obligations and duties under this Agreement or the Portfolio Management
Contract, respectively.
11. AMENDMENT. This Agreement may not be amended with respect to the
Fund without the affirmative votes (a) of a majority of the Directors of the
Directors, including a majority of those Directors who are not "interested
persons" of the Company or the Adviser and (b) of a "majority of the outstanding
shares" of the Fund. The terms "interested person" and "vote of a majority of
the outstanding shares" shall be construed in accordance with their respective
definitions in Sections 2(a)(19) and 2(a)(42) of the 1940 Act and, with respect
to the latter term, in accordance with Rule 18f-2 under the 1940 Act.
12. TERMINATION. This Agreement may be terminated as to the Fund, at
any time, without payment of any penalty, by the Board of Directors, or by a
vote of a majority of the outstanding shares of the Fund, upon at least 60 days'
written notice to the Adviser. This Agreement may be terminated by the Adviser
at any time upon at least 60 days' written notice to the Company. This Agreement
shall terminate automatically in the event of its "assignment" (as defined in
Section 2(a)(4) of the 1940 Act). Unless terminated as hereinbefore provided,
this Agreement shall continue in effect with respect to the Fund for a period of
two years from the date hereof 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 the Company or of the Adviser,
voting in person at a meeting called for the purpose of voting on such approval,
and (b) by either the Board of Directors or by a vote of a majority of the
outstanding shares of the Fund.
13. NOTICE. Any notice, demand, change of address or other
communication to be given in connection with this Agreement shall be given in
writing and shall be given by personal delivery, by registered or certified mail
or by transmittal by facsimile or other electronic medium addressed to the
recipient as follows:
To the Adviser: Xxxxxx Trust and Savings Bank
000 X. Xxxxxx Xxxxxx Xxxxx 0X
Xxxxxxx, XX 00000
Telephone: 000-000-0000
Fax: 000-000-0000
To the Company: HT Insight Funds, Inc.
Telephone:
Fax:
All notices shall be conclusively deemed to have been given on the day
of actual delivery thereof and, if given by registered or certified mail, on the
fifth business day following the deposit thereof in the mail and, if given by
facsimile or other electronic medium, on the day of transmittal thereof.
14. GOVERNING LAW. This Agreement shall be construed and interpreted in
accordance with the laws of the State of Illinois and the laws of the United
States of America applicable to contracts executed and to be performed therein.
15. REFERENCES AND HEADINGS. In this Agreement and in any such
amendment, references to this Agreement and all expressions such as "herein,"
"hereof," and "under this Agreement" shall be deemed to refer to this Agreement
or this Agreement as amended or affected by any such amendments. Headings are
placed herein for convenience of reference only and shall not be taken as a part
hereof or control or affect the meaning, construction or effect of this
Agreement. This Agreement may be executed in any number of counterparts, each of
which shall be deemed an original.
Dated: April 9, 1996
HT INSIGHT FUNDS, INC.
By /s/ Xxxxxxxx X. Xxxxxxxx
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Name: Xxxxxxxxx X. Xxxxxxxx
Title: President
ATTEST:
..................................
Xxxxxxxx X. Xxxxxxxx, Secretary
XXXXXX TRUST AND SAVINGS BANK
By /s/ Xxxxx X. Xxxxxxxx
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Name: Xxxxx X. Xxxxxxxx
Title: Senior Vice President
ATTEST:
............................
______________________, Assistant Secretary
