Exhibit d(2)
INVESTMENT ADVISORY AGREEMENT
AGREEMENT made this 29th day of June, 1999 between XXXXX FUND, a Massachusetts
business trust (the "Trust"), on behalf of the Xxxxx Millennium Opportunity
Fund, and Xxxxx Money Management, Inc., a corporation organized under the laws
of Florida (the "Adviser").
W I T N E S S E T H:
WHEREAS, the Trust is an open-end management investment company registered under
the Investment Company Act of 1940, as amended (the "1940 Act");
WHEREAS, the Trust is authorized to issue shares of beneficial interest
(hereafter referred to as "Shares") in separate series with each such series
representing the interests in a separate portfolio of securities and other
assets;
WHEREAS, the Trust has established and presently offers (or intends to offer)
Shares of beneficial interest in a portfolio currently known as the Xxxxx
Millennium Opportunity Fund (the "Fund"); and
WHEREAS, the Trust desires to retain the Adviser to render investment advisory
services to the Trust with respect to the Fund as indicated herein and the
Adviser is willing to so render such services;
NOW, THEREFORE, in consideration of the premises and mutual covenants
hereinafter set forth, the parties hereto agree as follows:
1. Appointment of Adviser. The Trust hereby appoints the Adviser
to act as investment adviser to the Trust and the Fund for the
periods and on the terms herein set forth. The Adviser accepts
such appointment and agrees to render the services herein set
forth, for the compensation herein provided.
2. Delivery of Documents. The Trust has delivered (or will
deliver as soon as is possible) to the Adviser copies properly
certified or authenticated of each of the following documents:
(a) Agreement and Declaration of Trust of the Trust dated
as of August 10, 1995 (such Agreement and Declaration
of Trust, as presently in effect and as amended from
time to time, is herein called the "Trust
Agreement"), copies of which are also on file with
the Secretary of the Commonwealth of Massachusetts;
(b) By-Laws of the Trust (such By-Laws, as presently in
effect and as amended from time to time, are herein
called the "By-Laws");
(c) Certified resolutions of the Shareholder(s) and the
Trustees of the Trust approving the terms of this
Agreement;
(d) Custodian Agreement (including related fee schedule)
dated January 15, 1996 between the Trust and PFPC
Trust Company (formerly PNC Bank) (such Agreement, as
presently in effect and as amended and/or superseded
from time to time, is herein called the "Custodian
Agreement");
(e) Prospectuses and Statements of Additional Information
of the Trust with respect to the Fund as currently in
effect (such Prospectuses and Statements of
Additional Information, as currently in effect and as
amended, supplemented and/or superseded from time to
time, is herein called the "Prospectus"); and
(f) Registration Statement of the Trust under the
Securities Act of 1933 (the "1933 Act"), and the 1940
Act on Form N-1A as filed with the Securities and
Exchange Commission (the "Commission") on August 10,
1995, and as amended on Form N-1A (such Registration
Statement, as presently in effect and as amended from
time to time, is herein called the "Registration
Statement").
The Trust agrees to promptly furnish the Adviser from time to time with copies
of all amendments of or supplements to or otherwise current versions of any of
the foregoing documents not heretofore furnished.
3. Name of Trust or Fund. The Trust and the Fund may use any name
derived from the name "Xxxxx Money Management, Inc.", if the Trust elects to do
so, only for so long as this Agreement, any other investment advisory or
management agreement between the Adviser and the Trust or any extension, renewal
or amendment hereof or thereof remains in effect, including any similar
agreement with any organization which shall have succeeded to the Adviser's
business as investment adviser. At such time as such an agreement shall no
longer be in effect, the Fund (to the extent the Corporation has the legal power
to cause it to be done) cease to use such a name or any other name indicating
that it is advised or managed by or otherwise connected with the Adviser or any
organization which shall have so succeeded to the Adviser's business.
4. Duties of Adviser.
(a) Subject to the general supervision of the Trustees of
the Trust, the Adviser shall manage the investment
operations of the Fund and the composition of the
Fund's assets, including the purchase, retention and
disposition thereof. In this regard, the Adviser:
(i) shall provide supervision of the Fund's
assets, furnish a continuous investment
program for the Fund, determine from time to
time what investments or securities will be
purchased, retained or sold by the Fund, and
what portion of the assets will be invested
or held uninvested as cash;
(ii) shall place orders with broker-dealers,
foreign currency dealers, futures
commissions merchants or others pursuant to
the Adviser's determinations in accordance
with the Fund's policies as expressed in the
Registration Statement; and
(iii) may, on occasions when it deems the
purchase or sale of a security to be in the
best interests of the Fund as well as its
other customers (including any other Fund or
any other investment company or trust or
advisory account for which the Adviser acts
as adviser), aggregate, to the extent
permitted by applicable laws and regulations,
the securities to be sold or purchased in
order to obtain the best net price and the
most favorable execution. In such event,
allocation of the securities so purchased or
sold, as well as the expenses incurred in the
transaction, will be made by the Adviser in
the manner it considers to be the most
equitable and consistent with its fiduciary
obligations to the Fund and to such other
customers.
(b) The Adviser, in the performance of its
duties hereunder, shall act in conformity
with the Trust Agreement, By-Laws,
Registration Statement and Prospectus and
with the instructions and directions of the
Trustees of the Trust, and will use its best
efforts to conform to the requirements of the
1940 Act, the Investment Advisers Act of 1940
(to the extent applicable), the Internal
Revenue Code of 1986, as amended (the
"Code"), relating to regulated investment
companies and all rules and regulations
thereunder, the Xxxxxxx Xxxxxxx and
Securities Fraud Enforcement Act of 1988 (to
the extent applicable), and all other
applicable federal and state laws,
regulations and rulings, subject always to
policies and instructions adopted by the
Trust's Board of Trustees. In connection
therewith, the Adviser shall use reasonable
efforts or manage the Fund so that it will
qualify as a regulated investment company
under Subchapter M of the Code and
regulations issued thereunder.
(c) The Adviser shall render to the Trustees
of the Trust such periodic and special
reports as the Trustees may reasonably
request.
(d) The Adviser shall notify the Trust of any
material change in the management of the
Adviser within a reasonable time after such
change.
(e) The Adviser shall immediately notify the
Trust in the event that the Adviser or any of
its affiliates: (1) becomes aware that it is
subject to a statutory disqualification that
prevents the Adviser from serving as
investment adviser pursuant to this
Agreement; or (2) becomes aware that it is
the subject of an administrative proceeding
or enforcement action by the Securities and
Exchange Commission or other regulatory
authority. The Adviser further agrees to
notify the Trust immediately of any material
fact known to the Adviser respecting or
relating to the Adviser that is not contained
in the Trust's Registration Statement
regarding the Trust, or any amendment or
supplement thereto, but that is required to
be disclosed therein, and of any statement
contained therein that becomes untrue in any
material respect.
(f) The services of the Adviser hereunder are not 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 thereby.
5. Allocation of Charges and Expenses. Except as otherwise specifically
provided in this section 5, the Adviser shall pay the compensation and expenses
of all trustees, officers and executive employees of the Trust (including the
Fund's share of payroll taxes) who are affiliated persons of the Adviser, and
the Adviser shall make available, without expense to the Fund, the services of
such of its directors, officers and employees as may duly be elected officers of
the Trust, subject to their individual consent to serve and to any limitations
imposed by law. The Adviser shall provide at its expense the portfolio
management services described in section 4 hereof, other than the cost
(including taxes and brokerage commissions, if any) of securities purchased for
the Fund.
The Adviser shall not be required to pay any expenses of the Fund other
than those specifically allocated to it in this section 5.
6. Management Fee. For all services to be rendered, payments to be made
and costs to be assumed by the Adviser as provided in sections 4 and 5 hereof,
the Trust on behalf of the Fund shall pay the Adviser an annual fee equal to
1.50% of the average daily net assets of the Fund (as defined below). Such fee
shall be payable monthly on the last day of each month.
The "average daily net assets" of the Fund shall mean the average of
the values placed on the Fund's net assets as of 4:00 p.m. (Eastern time) on
each day of the subject month on which the net asset value of the Fund is
determined consistent with the provisions of Rule 22c-1 under the 1940 Act or,
if the Fund lawfully determines the value of its net assets as of some other
time on each day, as of such time. The value of the net assets of the Fund shall
always be determined pursuant to the applicable provisions of the Trust
Agreement and the Registration Statement. If the determination of net asset
value does not take place for any particular day, then for the purposes of this
section 6, the value of the net assets of the Fund as last determined shall be
deemed to be the value of its net assets as of 4:00 p.m. (Eastern time), or as
of such other time as the value of the net assets of the Fund's portfolio may be
lawfully determined on that day. If the Fund determines the value of the net
assets of its portfolio more than once on any day, then the last such
determination thereof on that day shall be deemed to be the sole determination
thereof on that day for the purposes of this section 6.
The Adviser may waive all or a portion of its fees provided for
hereunder and such waiver shall be treated as a reduction in purchase price of
its services. The Adviser shall be contractually bound hereunder by the terms of
any publicly announced waiver of its fee, or any limitation of the Fund's
expenses, as if such waiver or limitation were fully set forth herein.
7. Avoidance of Inconsistent Position; Services Not Exclusive. In
connection with purchases or sales of portfolio securities and other investments
for the account of the Fund, neither the Adviser nor any of its directors,
officers or employees shall act as a principal or agent or receive any
commission. The Adviser or its agent shall arrange for the placing of all orders
for the purchase and sale of portfolio securities and other investments for the
Fund's account with brokers or dealers selected by the Adviser in accordance
with Fund policies as expressed in the Registration Statement. If any occasion
should arise in which the Adviser gives any advice to its clients concerning the
Shares of the Fund, the Adviser shall act solely as investment counsel for such
clients and not in any way on behalf of the Fund.
The Adviser's services to the Fund pursuant to this Agreement are not
be deemed to be exclusive and it is understood that the Adviser may render
investment advice, management and services to others. In acting under this
Agreement, the Adviser shall be an independent contractor and not an agent of
the Trust.
8. Limitation of Liability of Manager. As an inducement to the
Adviser's undertaking to render services pursuant to this Agreement, the Trust
agrees that the Adviser shall not be liable under this Agreement for any error
of judgment or mistake of law or for any loss suffered by the Fund in connection
with the matters to which this Agreement relates, provided that nothing in this
Agreement shall be deemed to protect or purport to protect the Adviser against
any liability to the Trust, the Fund or its shareholders to which the Adviser
would otherwise be subject 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 hereunder. Any person, even though also
employed by the Adviser, who may be or become an employee of and paid by the
Fund shall be deemed when acting within the scope of his or her employment by
the Fund, to be acting in such employment solely for the Fund and not as the
Adviser's employee or agent.
9. Duration and Termination of This Agreement. This Agreement shall
remain in force until June 29, 2001, and continue in force from year to year
thereafter, but only so long as such continuance is specifically approved at
least annually (a) by the vote of a majority of the Trustees who are not parties
to this Agreement or 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 Trustees of the Trust, or by the vote of a majority of the outstanding
voting securities of the Fund. The aforesaid requirement that continuance of
this Agreement be "specifically approved at least annually" shall be construed
in a manner consistent with the 1940 Act and the rules and regulations
thereunder.
This Agreement may be terminated with respect to the Fund at any time,
without the payment of any penalty, by the vote of a majority of the outstanding
voting securities of the Fund or by the Trust's Board of Trustees on 60 days'
written notice to the Adviser, or by the Adviser on 60 days' written notice to
the Fund.
This Agreement shall terminate automatically in the event of its assignment.
10. Retention of Sub-Advisers. Subject to the Fund's obtaining any
initial and periodic approvals that are required under Section 15 of the 1940
Act, the Adviser may retain a sub-adviser or sub-advisers with respect to the
Fund, at the Adviser's own cost and expense.
11. 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 whom enforcement of the change, waiver,
discharge or termination is sought, and no amendment of this Agreement shall be
effective until approved by the vote of a majority of the Trustees who are not
parties to this Agreement or interested persons of any party to this Agreement,
cast in person at a meeting called for the purpose of voting on such approval.
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. This
Agreement may be executed simultaneously in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
In interpreting the provisions of this Agreement, the definitions
contained in Section 2(a) of the 1940 Act (particularly the definitions of
"affiliated person," "assignment" and "majority of the outstanding voting
securities"), as from time to time amended, shall be applied, subject, however,
to such exemptions as may be granted by the SEC by any rule, regulation or
order.
This Agreement shall be construed in accordance with the laws of the
Commonwealth of Massachusetts, provided that nothing herein shall be construed
in a manner inconsistent with the 1940 Act, or in a manner which would cause the
Fund to fail to comply with the requirements of Subchapter M of the Code.
It is understood that the Fund is a series of the Trust, which was
organized as a Massachusetts business trust under the Trust Agreement, that the
Trust Agreement refers to the Trustees collectively as trustees and not as
individuals personally, and that the Trust Agreement provides that no
shareholder, Trustee, officer, employee or agent shall be subject to any claims
against or obligations of the Trust to any extent whatsoever, but that the Trust
estate only shall be liable. No series of the Trust shall be liable for the
obligations of any other series.
This Agreement shall supersede all prior investment advisory or
management agreements entered into between the Adviser and the Fund.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed as of the day and year first above written.
XXXXX FUND,
on behalf of Xxxxx Millennium Opportunity Fund
Attest:
/S/XXXXX X. XXXXX By: /S/ XXXX X. XXXXXXXXX
Title: President
XXXXX MONEY MANAGEMENT, INC.
Attest:
/S/XXXXX X. XXXXX By: /S/ XXXX X. XXXXXXXXX
Title: President
