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EXHIBIT 5
INVESTMENT ADVISORY AGREEMENT
OLD MUTUAL SOUTH AFRICA EQUITY TRUST
THIS INVESTMENT ADVISORY AGREEMENT, dated as of October 23, 1995 (this
"Agreement"), by and between Old Mutual South Africa Equity Trust, a
Massachusetts trust (the "Trust"), and Old Mutual Asset Managers (Bermuda)
Limited (the "Adviser");
WITNESSETH:
WHEREAS, the Trust will engage in business as an open-end investment company
registered under the United States Investment Company Act of 1940 (collectively
with the rules and regulations promulgated thereunder, the "1940 Act"),
WHEREAS, Old Mutual Fund Holdings (Bermuda) Limited, a Bermuda company, Old
Mutual Equity Growth Assets South Africa Fund, a Massachusetts business trust
that will register under the 1940 Act, and Old Mutual South Africa Growth Assets
Fund, a Bermuda mutual fund that is to be listed on the Irish Stock Exchange
(the "ISO"), are expected to acquire beneficial interests in the Trust, and
WHEREAS, the Trust wishes to engage the Adviser to provide certain
investment advisory services for the Trust, and the Adviser is willing to
provide such investment advisory services for the Trust on the terms and
conditions hereinafter set forth,
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
and agreements herein set forth, the parties covenant and agree as follows:
1. Duties of the Adviser. The Trust engages the Adviser as investment
adviser to the Trust upon the terms and conditions of this Agreement, and the
Adviser accepts such engagement. The Adviser shall act as investment adviser of
the Trust and in that capacity shall:
(a) provide the Trust with such investment advice and supervision as the
Trust may from time to time consider necessary for the proper
supervision of the Trust's investment assets,
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(b) determine from time to time what securities shall be purchased, sold or
exchanged and what portion of the assets of the Trust shall be held
uninvested, and
(c) make recommendations as to the manner in which voting rights, rights to
consent to corporate action and any other rights pertaining to the
Trust's securities shall be exercised,
provided, however, the Adviser's performance of such duties shall be subject
always to the restrictions contained within:
(a) the Trust's Declaration of Trust, dated as of September 1, 1995 (the
"Declaration"),
(b) the Trust's By-laws (the "By-laws"),
(c) the 1940 Act,
(d) the rules of the ISO,
(e) the then-current Registration Statement of the Trust under the 1940
Act, and
(f) such determinations of investment policy for the Trust as the Board may
from time to time establish with notice to the Adviser (provided the
Adviser shall be bound by any such policy for the period, if any,
specified in such notice or until similarly notified that such policy
has been revoked).
The Adviser shall take, on behalf of the Trust, all actions which it deems
necessary to implement the investment policies of the Trust, and in particular
to place all orders for the purchase or sale of securities for the Trust's
account with the brokers or dealers selected by the Adviser, and to that end the
Adviser is authorized as the agent of the Trust to give instructions to the
custodian (and any subcustodians) of the Trust as to deliveries of securities
and payments of cash for the account of the Trust. In connection with the
selection of brokers or dealers for the Trust and the placing of such orders,
the Adviser is directed to seek for the Trust in its best judgment, prompt
execution in an effective manner at the most favorable price. Subject to this
requirement of seeking the most favorable price, securities may be bought from
or sold to broker-dealers who have furnished statistical, research and other
information or services to the Adviser or the Trust, subject to any applicable
laws, rules and regulations.
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2. Allocation of Charges and Expenses. The Adviser shall furnish at its own
expense all services, facilities and personnel necessary or convenient to
perform its duties under Section 1 above. The Trust will pay from its assets all
of its own expenses allocable to the Trust including compensation of Trustees
not employed by the Adviser or a parent company of the Adviser; governmental
fees; interest charges; taxes; membership dues in the Investment Company
Institute allocable to the Trust; fees and expenses of independent auditors and
of legal counsel of the Trust; expenses of issuing and redeeming beneficial
interests in the Trust and servicing Holder (as defined in the Declaration)
accounts; expenses of preparing, printing and mailing, notices, proxy statements
and reports to governmental officers and commissions and to Holders; expenses
connected with the execution, recording and settlement of security transactions;
insurance premiums; fees and expenses of the custodian (and any subcustodians)
for all services to the Trust, including safekeeping of funds and securities and
maintaining required books and accounts; expenses of calculating the net asset
value of the Trust; and expenses of meetings of the Trustees and Holders.
3. Compensation of the Adviser. For the services to be rendered under this
Agreement, the Trust shall pay to the Adviser from the assets of the Trust a
management fee of 0.85% per annum of the Trust's daily net assets (the
"Management Fee"). The Management Fee shall accrue daily on an annualized basis
and be paid monthly in arrears. If the Adviser serves under this Agreement for
less than the whole of any period specified in this Section 3, the Management
Fee shall be prorated for such partial period.
4. Covenants of the Adviser. The Adviser shall throughout the term of this
Agreement:
(a) not deal with itself, or with the Trustees of the Trust as principals,
in making purchases or sales of securities or other property for the
account of the Trust, except as permitted by the 1940 Act and the rules
of the ISO,
(b) not take a long or short position in shares of the Trust except as
permitted by the Declaration,
(c) comply with all other provisions of the 1940 Act, the ISO rules, the
Declaration, the By-laws and the then-current 1940 Act Registration
Statement of the Trust relative to the Adviser and its directors and
officers, and
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(d) maintain its registration under the United States Investment Advisers
Act of 1940, comply with rules thereunder and notify the Trustees of
any proceedings to revoke, suspend or modify such registration.
5. Limitation of Liability of the Adviser. The Adviser shall not be liable
for any error of judgment, mistake of law, loss arising out of any investment or
act or omission in the execution of securities transactions for the Trust,
except for willful misfeasance, bad faith or gross negligence in the performance
of its duties, or by reason of reckless disregard of its obligations and duties
hereunder. As used in this Section 5, the term "Adviser" shall include
directors, officers and employees of the Adviser.
6. Activities of the Adviser. The engagement of the Adviser under this
Agreement shall not be exclusive, and the Adviser shall be free to render
investment advisory and/or other services to others. The Trust shall have no
right or interest in any income from any such services. It is understood that
Trustees, officers, and Holders of the Trust are or may be or may become
interested in the Adviser, as directors, officers, employees, or otherwise and
that directors, officers and employees of the Adviser are or may become
similarly interested in the Trust and that the Adviser and/or its affiliates may
be or may become interested in the Trust as a Holder or otherwise.
7. Duration, Termination and Amendment of this Agreement.
(a) This Agreement shall become effective as of the day and year first
above written and shall govern the relations between the parties hereto
thereafter, and shall remain in force until October 23, 1997 on which
date it will terminate unless its continuance after October 23, 1997 is
"specifically approved at least annually" (i) by the vote of a majority
of the Trustees of the Trust who are not "interested persons" of the
Trust or of the Adviser at a meeting specifically called for the
purpose of voting on such approval, and (ii) by the Board of Trustees
of the Trust or by "vote of a majority of the outstanding voting
securities" of the Trust.
(b) This Agreement may be terminated at any time without the payment of any
penalty by the Trustees or by the "vote of a majority of the
outstanding voting securities" of the Trust, or by the Adviser, in each
case on not more than 60 days' nor less than 30 days' written notice to
the other party. This
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Agreement shall automatically terminate in the event of its
"assignment."
(c) This Agreement may be amended only if such amendment is approved by the
"vote of a majority of the outstanding voting securities" of the Trust.
(d) The terms "specifically approved at least annually," "vote of a
majority of the outstanding voting securities," "assignment,"
"affiliated person," and "interested persons," when used in this
Agreement, shall have the respective meanings specified in, and shall
be construed in a manner consistent with, the 1940 Act, subject,
however, to such exemptions as may be granted by the United States
Securities and Exchange Commission under said Act.
8. Trust Obligations. The obligations of the Trust hereunder shall not be
binding upon any of the Trustees, Holders, nominees, officers, agents or
employees of the Trust, personally, but shall bind only the assets and property
of the Trust as provided in the Declaration.
9. Name of Trust. In the event the Adviser ceases for any reason to serve as
investment adviser of the Trust, the Trust shall forthwith upon request by the
Adviser (i) change its name so that it does not include the words "Old Mutual",
"OMEGA", "SAGA" or any variation or combination of any thereof, and (ii) require
any Holders to do the same (other than any Holder whose continued use of such
name is consented to in writing by the Adviser).
10. Notices. All notices, requests, and other communications hereunder shall
be in writing and shall be delivered by hand to an officer of the addressee or
sent by courier service or certified mail return receipt requested, postage
prepaid, addressed to the respective address of the addressee. Any notice given
pursuant to this Agreement shall be deemed to have been given when delivered or
when delivery is duly attempted and refused.
11. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the Commonwealth of Massachusetts, subject to the
applicable provisions of the 1940 Act, without regard to any choice of law
principles that would require application of the laws of any other jurisdiction.
The parties hereto absolutely and irrevocably consent to the jurisdiction of the
courts of the Commonwealth of Massachusetts and of any Federal court located in
said
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Commonwealth in connection with any actions or proceedings arising out of or
relating to this Agreement and waive any objection to the convenience of any
such court.
12. Headings. The descriptive section headings have been inserted for
convenience of reference only and do not define or limit the provisions hereof.
13. Severability. If any term of this Agreement shall be held to be invalid,
illegal or unenforceable, the validity of all other terms hereof shall be in no
way affected thereby, and this Agreement shall be construed and be enforceable
as if such invalid, illegal or unenforceable term had not been included herein.
14. Entire Agreement. This Agreement sets forth the entire agreement of the
parties hereto with respect to the subject matter hereof and supersedes any
prior negotiations, understandings or arrangements.
15. Counterparts. This Agreement may be executed in several counterparts,
each of which when executed and delivered is an original, but all of which
together shall constitute one instrument. In making proof of this Agreement, it
shall not be necessary to produce or account for more than one such counterpart.
16. Rules of Interpretation. The following rules shall apply in the
construction and interpretation of this Agreement:
(a) The singular includes the plural, and the plural includes the singular.
(b) A reference to any gender includes each other gender.
(c) A reference to any Person includes its legal successors and permitted
assigns.
(d) A reference to any contract, instrument, agreement or other document,
including any registration statement under the 1940 Act, shall include any
written amendment, supplement or modification thereto and any replacement
thereof.
(e) A reference to any statute, law, rule or regulation shall include any
amendment or modification thereto and any replacement thereof.
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(f) The words "include," "includes" and "including" are not limiting.
(h) The words "hereof," "herein" and "hereunder" and words of similar import
shall refer to this Agreement as a whole and not to any particular part of this
Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered in their names and on their behalf by the undersigned,
thereunto duly authorized, all as of the day and year first above written.
The undersigned Trustee or officer of the Trust has executed this Agreement
not individually, but as Trustee or officer under the Trust's Declaration of
Trust, dated as of September 1, 1995, as amended, and the obligations of this
Agreement are not binding upon any of the Trustees or officers of the Trust
individually.
OLD MUTUAL SOUTH AFRICA OLD MUTUAL ASSET
EQUITY TRUST MANAGERS (BERMUDA)
LIMITED
By: Xxxxxxx X. Xxxxxx By: Xxxxxxx Xxxxxxx
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Xxxxxxx X. Xxxxxx Xxxxxxx Xxxxxxx
Chairman of the Board President
