2
XXXXXXXXXXX GOLD & SPECIAL MINERALS FUND
Period Ending 12/31/2008
Exhibit 77Q1
AMENDED AND RESTATED
INVESTMENT ADVISORY AGREEMENT
AMENDED AND RESTATED INVESTMENT ADVISORY AGREEMENT made as of the 1st day of
September, 2007 by and between XXXXXXXXXXX GOLD & SPECIAL MINERALS FUND (the
"Fund"), and OppenheimerFunds, Inc. ("OFI").
WHEREAS, the Fund is an open-end, diversified management investment company
registered as such with the Securities and Exchange Commission (the
"Commission") pursuant to the Investment Company Act of 1940 (the "Investment
Company Act"), and OFI is an investment adviser registered as such with the
Commission under the Investment Advisers Act of 1940; and
WHEREAS, the Fund and OFI entered into an Investment Advisory Agreement dated
June 6, 1991, as amended and restated on January 1, 2005;
WHEREAS, the Fund and OFI agreed, per a resolution of the Fund's Board of
Trustees dated August 16, 2007 to reduce the Fund's management fee effective
September 1, 2007 to the following annual rates that declines as the Fund's
assets grow: 0.75% of the first $200 million of average annual net assets of the
Fund, 0.72% of the next $200 million, 0.69% of the next $200 million, 0.66% of
the next $200 million, 0.60% of the next $3.2 billion and 0.58% of average
annual net assets over $4.0 billion;
NOW, THEREFORE, in consideration of the mutual promises and covenants
hereinafter set forth, it is agreed by and between the parties, as follows:
1. GENERAL PROVISION.
The Fund hereby employs OFI and OFI hereby undertakes to act as the investment
adviser of the Fund and to perform for the Fund such other duties and functions
as are hereinafter set forth. OFI shall, in all matters, give to the Fund and
its Board of Trustees the benefit of its best judgment, effort, advice and
recommendations and shall, at all times conform to, and use its best efforts to
enable the Fund to conform to (i) the provisions of the Investment Company Act
and any rules or regulations thereunder; (ii) any other applicable provisions of
state or federal law; (iii) the provisions of the Declaration of Trust and
By-Laws of the Fund as amended from time to time; (iv) policies and
determinations of the Board of Trustees of the Fund; (v) the fundamental
policies and investment restrictions of the Fund as reflected in its
registration statement under the Investment Company Act or as such policies may,
from time to time, be amended by the Fund's shareholders; and (vi) the
Prospectus and Statement of Additional Information of the Fund in effect from
time to time. The appropriate officers and employees of OFI shall be available
upon reasonable notice for consultation with any of the Trustees and officers of
the Fund with respect to any matters dealing with the business and affairs of
the Fund including the valuation of any of the Fund's portfolio securities which
are either not registered for public sale or not being traded on any securities
market.
2. INVESTMENT MANAGEMENT.
(a) OFI shall, subject to the direction and control by the Fund's Board
of Trustees, (i) regularly provide investment advice and recommendations to the
Fund with respect to its investment policies and the purchase and sale of
securities; (ii) supervise continuously the investment program of the Fund and
the composition of its portfolio and determine what securities shall be
purchased or sold by the Fund; and (iii) arrange, subject to the provisions of
paragraph "8" hereof, for the purchase of securities and other investments for
the Fund and the sale of securities and other investments held in the portfolio
of the Fund.
(b) Provided that the Fund shall not be required to pay any
compensation other than as provided by the terms of this Agreement and subject
to the provisions of paragraph "8" hereof, OFI may obtain investment
information, research or assistance from any other person, firm or corporation
to supplement, update or otherwise improve its investment management services.
(c) So long as it shall have acted with due care and in good faith, OFI
shall not be liable for any loss sustained by reason of any investment, the
adoption of any investment policy, or the purchase, sale or retention of any
security irrespective of whether the determinations of OFI relative thereto
shall have been based, wholly or partly, upon the investigation or research of
any other individual, firm or corporation believed by it to be reliable. Nothing
herein contained shall, however, be construed to protect OFI against any
liability to the Fund or its security holders by reason of willful misfeasance,
bad faith or gross negligence in the performance of its duties, or by reason of
its reckless disregard of its obligations and duties under this Agreement.
3. ACTING AS ADVISER FOR OTHERS.
Nothing in this Agreement shall prevent OFI or any officer thereof from
acting as investment adviser for any other person, firm or corporation and shall
not in any way limit or restrict OFI or any of its directors, officers,
stockholders or employees from buying, selling or trading any securities for its
or their own account or for the account of others for whom it or they may be
acting, provided that such activities will not adversely affect or otherwise
impair the performance by OFI of its duties and obligations under this
Agreement.
4. OTHER DUTIES OF OFI.
OFI shall, at its own expense, provide and supervise the activities of
all administrative and clerical personnel as shall be required to provide
effective administration for the Fund, including the compilation and maintenance
of such records with respect to its operations as may reasonably be required;
the preparation and filing of such reports with respect thereto as shall be
required by the Commission; composition of periodic reports with respect to its
operations for the shareholders of the Fund; composition of proxy materials for
meetings of the Fund's shareholders and the composition of such registration
statements as may be required by federal securities laws for continuous public
sale of shares of the Fund. OFI shall, as its own cost and expense, also provide
the Fund with adequate office space, facilities and equipment.
5. ALLOCATION OF EXPENSES.
All other costs and expenses not expressly assumed by OFI under this
Agreement, or to be paid by the General Distributor of the shares of the Fund,
shall be paid by the Fund, including, but not limited to (i) interest and taxes;
(ii) brokerage commissions; (iii) insurance premiums for fidelity and other
coverage requisite to its operations; (iv) compensation and expenses of its
trustees other than those associated or affiliated with OFI; (v) legal and audit
expenses; (vi) custodian and transfer agent fees and expenses; (vii) expenses
incident to the redemption of its shares; (viii) expenses incident to the
issuance of its shares against payment therefor by or on behalf of the
subscribers thereto; (ix) fees and expenses, other then as hereinabove provided,
incident to the registration under federal securities laws of shares of the Fund
for public sale; (x) expenses of printing and mailing reports, notices and proxy
materials to shareholders of the Fund; (xi) except as noted above, all other
expenses incidental to holding meetings of the Fund's shareholders; and (xii)
such extraordinary non-recurring expenses as may arise, including litigation,
affecting the Fund and the legal obligation which the Fund may have to indemnify
its officers and directors with respect thereto. Any officers or employees of
OFI or any entity controlling, controlled by or under common control with OFI,
who may also serve as officers, trustees or employees of the Fund shall not
receive any compensation by the Fund for their services.
6. COMPENSATION OF OFI.
The Fund agrees to pay OFI and XXX agrees to accept as full
compensation for the performance of all functions and duties on its part to be
performed pursuant to the provisions hereof, a fee computed on the aggregate net
asset value of the Fund as of the close of each business day and payable monthly
at the following annual rate:
0.75% of the first $200 million of aggregate net assets, 0.72% of the
next $200 million, 0.69% of the next $200 million, 0.66% of the next
$200 million, 0.60% of the next $3.2 billion, and 0.58% of aggregate
net assets over $4.0 billion.
7. USE OF NAME "XXXXXXXXXXX."
OFI hereby grants to the Fund a royalty-free, non-exclusive license to
use the name "Xxxxxxxxxxx" in the name of the Fund for the duration of this
Agreement and any extensions or renewals thereof. Such license may, upon
termination of this Agreement, be terminated by OFI, in which event the Fund
shall promptly take whatever action may be necessary to change its name and
discontinue any further use of the name "Xxxxxxxxxxx" in the name of the Fund or
otherwise. The name "Xxxxxxxxxxx" may be used or licensed by OFI in connection
with any of its activities or licensed by OFI to any other party.
8. PORTFOLIO TRANSACTIONS AND BROKERAGE.
(a) OFI is authorized, in arranging the purchase and sale of the Fund's
portfolio securities, to employ or deal with such members of securities
exchanges, brokers or dealers, including "affiliated" broker-dealers (as that
term is defined in the Investment Company Act), (hereinafter "broker-dealers"),
as may, in its best judgment, implement the policy of the Fund to obtain, at
reasonable expense, the "best execution" (prompt and reliable execution at the
most favorable security price obtainable) of the Fund's portfolio transactions
as well as to obtain, consistent with the provisions of subparagraph "(c)" of
this paragraph "8," the benefit of such investment information or research as
will be of significant assistance to the performance by OFI of its investment
management functions.
(b) OFI shall select broker-dealers to effect the Fund's portfolio
transactions on the basis of its estimate of their ability to obtain best
execution of particular and related portfolio transactions. The abilities of a
broker-dealer to obtain best execution of particular portfolio transaction(s)
will be judged by OFI on the basis of all relevant factors and considerations
including, insofar as feasible, the execution capabilities required by the
transaction or transactions; the ability and willingness of the broker-dealer to
facilitate the Fund's portfolio transactions by participating therein for its
own account; the importance to the Fund of speed, efficiency or confidentiality;
the broker-dealer's apparent familiarity with sources from or to whom particular
securities might be purchased or sold; as well as any other matters relevant to
the selection of a broker-dealer for particular and related transactions of the
Fund.
(c) OFI shall have discretion, in the interests of the Fund, to
allocate brokerage on the Fund's portfolio transactions to broker-dealers, other
than affiliated broker-dealers, qualified to obtain best execution of such
transactions who provide brokerage and/or research services (as such services
are defined in Section 28(e)(3) of the Securities Exchange Act of 1934) for the
Fund and/or other accounts for which OFI exercises "investment discretion" (as
that term is defined in Section 3(a)(35) of the Securities Exchange Act of 1934)
and to cause the Fund to pay such broker-dealers a commission for effecting a
portfolio transaction for the Fund that is in excess of the amount of commission
another broker-dealer adequately qualified to effect such transaction would have
charged for effecting that transaction, if OFI determines, in good faith, that
such commission is reasonable in relation to the value of the brokerage and/or
research services provided by such broker-dealer, viewed in terms of either that
particular transaction or OFI's overall responsibilities with respect to the
accounts as to which it exercises investment discretion. In reaching such
determination, OFI will not be required to place or attempt to place a specific
dollar value on the brokerage and/or research services provided or being
provided by such broker-dealer. In demonstrating that such determinations were
made in good faith, OFI shall be prepared to show that all commissions were
allocated for purposes contemplated by this Agreement and that the total
commissions paid by the Fund over a representative period selected by the Fund's
trustees were reasonable in relation to the benefits to the Fund.
(d) OFI shall have no duty or obligation to seek advance competitive
bidding for the most favorable commission rate applicable to any particular
transactions or to select any broker-dealer on the basis of its purported or
"posted" commission rate but will, to the best of its ability, endeavor to be
aware of the current level of the charges of eligible broker-dealers and to
minimize the expense incurred by the Fund for effecting its portfolio
transactions to the extent consistent with the interests and policies of the
Fund as established by the determinations of its Board of Trustees and the
provisions of this paragraph "8."
(e) The Fund recognizes that an affiliated broker-dealer (i) may act as
one of the Fund's regular brokers so long as it is lawful for it so to act; (ii)
may be a major recipient of brokerage commissions paid by the Fund; and (iii)
may effect portfolio transactions for the Fund only if the commissions, fees or
other remuneration received or to be received by it are determined in accordance
with procedures contemplated by any rule, regulation or order adopted under the
Investment Company Act for determining the permissible level of such
commissions.
9. DURATION.
This Agreement will take effect on the date set forth above and will
continue in effect from year to year, so long as such continuance shall be
approved at least annually by the Fund's Board of Trustees, including the vote
of the majority of the trustees of the Fund who are not parties to this
Agreement or "interested persons" (as defined in the Investment Company Act) of
any such party, cast in person at a meeting called for the purpose of voting on
such approval, or by the holders of a "majority" (as defined in the Investment
Company Act) of the outstanding voting securities of the Fund and by such a vote
of the Fund's Board of Trustees.
10. TERMINATION.
This Agreement may be terminated (i) by OFI at any time without penalty
upon giving the Fund sixty days' written notice (which notice may be waived by
the Fund); or (ii) by the Fund at any time without penalty upon sixty days'
written notice to OFI (which notice may be waived by OFI) provided that such
termination by the Fund shall be directed or approved by the vote of a
"majority" of all of the trustees of the Fund then in office or by the vote of
the holders of a "majority" (as defined in the Investment Company Act) of the
outstanding voting securities of the Fund.
11. ASSIGNMENT OR AMENDMENT.
This Agreement may not be amended or the rights of OFI hereunder sold,
transferred, pledged or otherwise in any manner encumbered without the
affirmative vote or written consent of the holders of the majority of the
outstanding voting securities of the Fund; this Agreement shall automatically
and immediately terminate in the event of its "assignment," as defined as stated
below.
12. SHAREHOLDER LIABILITY.
OFI understands and agrees that the obligations of the Fund under this
Agreement are not binding upon any Trustee or shareholder of the Fund
personally, but bind only the Fund and the Fund's property; OFI represents that
it has notice of the provisions of the Declaration of Trust of the Fund
disclaiming shareholder liability for acts or obligations of the Fund.
13. DEFINITIONS.
The terms and provisions of this Agreement shall be interpreted and
defined in a manner consistent with the provisions and definitions of the
Investment Company Act.
XXXXXXXXXXX GOLD & SPECIAL MINERALS FUND
By: ____/S/ XXXXXX X. XXXX________________
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Xxxxxx X. Xxxx
Secretary
OPPENHEIMERFUNDS, INC.
By: ____/S/ XXXX XXXXXXXXXX_______________
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Xxxx Xxxxxxxxxx
President
