EXHIBIT 5
AMENDED AND RESTATED INVESTMENT ADVISORY AGREEMENT
AMENDED AND RESTATED AGREEMENT made this day of May 1997, by and
between American Federation of Labor and Congress of Industrial Organizations
Housing Investment Trust, a trust formed under the laws of the District of
Columbia (the "Trust"), and Wellington Management Company, LLP, a
Massachusetts limited liability partnership (the "Investment Advisor").
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 desires to retain the Investment Adviser to render
investment advisory services, as described herein, to the Trust, and the
Investment Adviser is willing to render such services;
WHEREAS, the Trust and Investment Adviser entered into an Investment
Advisory Agreement dated May 21, 1992; and
WHEREAS, the Trust and the Investment Adviser have determined it
advisable to amend that Agreement.
NOW, THEREFORE, in consideration of mutual covenants herein contained,
the parties hereto agree as follows:
1. Duties and Representations of the Investment Adviser.
a) Investment Advisory Services.
The following services shall be provided with respect to the Trust assets
that the Trust designates from time to time as being subject to this Agreement
(the "Short/Intermediate-Term Assets"), which may include the types of
securities listed on Schedule A to this Agreement. The Investment Adviser
shall manage the investment and reinvestment of the Short/Intermediate Term
Assets; continuously review, supervise, and administer the investment program
of the Trust with respect to the Short/Intermediate-Term Assets; determine in
its discretion the Short/Intermediate-Term Assets to be purchased, retained
and sold (and implement those decisions); render regular reports as required
to the Trust's officers and Trustees concerning the Investment Adviser's
discharge of the foregoing responsibilities, including causing to be provided
to the Trust's officers within two business days after each Valuation Date, as
defined in the Trust's prospectus, market prices as of the Valuation Date of
Short/Intermediate-Term Assets that mature more than 60 days after the
Valuation Date; develop and produce portfolio analysis reports, including
reports which may assist the Trust in determining the allocation of assets
within this portfolio; monitor portfolio investment characteristics; analyze
portfolio performance and provide to the Trust's officers within ten business
days after each calendar month end a report regarding such performance for
such month; provide analysis on markets and instruments; provide investment
overview and economic outlook forecasts; provide information and comment on
various relevant regulatory and legal issues; attend meetings of the Trust's
Executive Committee and Trustees as reasonably requested; and supply the
Trust's officers and Trustees with all statistical information and reports
reasonably required by them, including, without limitation, all information
required under Section 15(c) of the 1940 Act. The Investment Adviser shall
have no authority or responsibility with respect to any assets of the Trust
other than the Short/Intermediate-Term Assets.
b)Other Services.
From time to time, the Investment Adviser will also provide analysis to
the Trust which may be used in determining the risk profile of the Trust's
asset structure.
c) Discharge of Investment Adviser's Duties.
The Investment Adviser shall discharge the responsibilities set forth in
Section 1(a) subject to the oversight of the officers and Trustees of the
Trust and in compliance with such policies as the Trustees may from time to
time establish, and in compliance with the objectives, policies, and
limitations of the Trust set forth in the Trust's prospectus, statement of
additional information and declaration of trust, in each case as amended from
time to time, and with the Investment Company Act of 1940, as amended, the
Investment Advisers Act of 1940, as amended, and any other applicable laws and
regulations. The Investment Adviser agrees, at its own expense, to render the
services described herein and to provide the office space, furnishings and
equipment, and personnel required by it to perform those services on the terms
and for the compensation provided herein.
d) Representations of the Investment Adviser.
The Investment Adviser represents and warrants that (i) it is duly
registered as an investment adviser with the Securities and Exchange
Commission pursuant to the Investment Adviser Act of 1940, as amended and (ii)
it does not currently have an affiliated broker/dealer that is active in the
securities business. Failure of these representations and warranties shall
give the Trust the right to immediately terminate this Agreement.
e) Portfolio Transactions.
The Investment Adviser is authorized to arrange for the execution of the
Trust's portfolio transactions by selecting the brokers or dealers that will
execute the purchases and sales of portfolio securities for the Trust and is
directed to use its best efforts to obtain the best net results, taking into
account such factors as price (including the applicable brokerage commission
or dealer spread), size of order, difficulty of execution and operational
facilities of the firm involved. The Investment Adviser may, in its
discretion, purchase and sell portfolio securities through brokers who provide
the Investment Adviser or the Trust with research, analysis, advice and
similar services, and the Investment Adviser may pay to these brokers, in
return for research and analysis, a higher commission than may be charged by
other brokers, provided that the Investment Adviser determines in good faith
that such commission is reasonable in terms either of that particular
transaction or of the overall responsibility of the Investment Adviser, that
the total commission paid by the Trust will be reasonable in relation to the
benefits to the Trust over the long-term, and that the total commission paid
by the Trust is consistent with commissions paid in comparable transactions.
On occasions when the Investment Adviser deems the purchase or sale of a
security to be in the best interest of the Trust as well as other clients, the
Investment Adviser, to the extent permitted by applicable laws and
regulations, may, but shall be under no obligations to, aggregate the
securities to be so purchased or sold in order to obtain the most favorable
price or lower brokerage commissions and efficient 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 Investment Adviser in the
manner it considers to be the most equitable and consistent with its fiduciary
obligations.
3. Compensation of the Investment Adviser.
a) Investment Advisory Fee.
For the investment advisory services rendered by the Investment Adviser
as provided in Section 1(a) of this Agreement, the Trust shall pay to the
Investment Adviser a quarterly investment advisory fee at the annual rate of
0.16% of the market value of the Short/Intermediate-Term Assets, based on the
average monthly market value. The investment advisory fee shall be paid as
promptly as possible after the last day of each calendar quarter. Unless
otherwise directed by the Trust's Board of Trustees or a Trust officer, the
Investment Adviser shall not sell or otherwise liquidate the
Short/Intermediate-Term Assets for the purpose of being paid its investment
advisory fee.
b) Method of Payment.
The first payment of the investment advisory fee shall be made as
promptly as possible after the last day of the calendar quarter in which the
effective date of this Agreement falls, and shall constitute a full payment of
the fee due the Investment Adviser for all services rendered pursuant to this
Agreement prior to that date. In the event that the Investment Adviser's
right to such fee commences to accrue on a date other than the first day of
the quarter, the investment advisory fee shall be computed on the basis of the
period beginning on the first business day on which this Agreement is in
effect, subject to a pro rata adjustment based on the number of days in that
period as a percentage of the total number of days in such a period. In the
event of termination of this Agreement, the investment advisory fee shall be
computed on the basis of the period ending on the last business day on which
this Agreement is in effect, subject to a pro rata adjustment based on the
number of days elapsed in the current calendar quarter as a percentage of the
total number of days in such quarter. The market value of the
Short/Intermediate-Term assets shall in all cases be based only on those days
when the New York Stock Exchange is open for business, and shall be computed
as of the time of the regular close of Business of the New York Stock
Exchange, or such other time as may be determined by the Trust's Board of
Trustees. Each fee payment to the Investment Adviser shall be accompanied by
a report of the Trust which shall show the amount properly payable to the
Investment Adviser under this Agreement and the detailed computation thereof.
4. Reports.
The Trust and the Investment Adviser agree to furnish to each other, if
applicable, current prospectuses, statements of additional information,
registration statements, proxy statements, reports to shareholders and
certified copies of their financial statements, and, as each may reasonably
request, such other information with regard to their affairs.
5. Status of the Investment Adviser and the Trust.
The services of the Investment Adviser to the Trust are not to be deemed
exclusive, and the Investment Adviser shall be free to render similar services
to others so long as its services to the Trust are not impaired thereby. The
Investment Adviser shall be deemed to be an independent contractor and shall
have no authority to act for or represent the Trust in any way or otherwise be
deemed to be an agent of the Trust, except in performing its duties and
responsibilities under this Agreement. Nothing in this Agreement shall limit
or restrict the right of any partner, Trustee, officer or employee of the
Investment Adviser of the Trust to engage in any other business or to devote
his or her time and attention in part to the management or other aspects of
any other business, whether of a similar nature or a dissimilar nature.
Nothing in this Agreement shall limit or restrict the right of the Trust to
retain other investment advisers.
6. Certain Records.
Any records required to be maintained and preserved pursuant to the
provisions of Rule 31a-1 and Rule 31a-2 promulgated under the 1940 Act which
are prepared or maintained by the Investment Adviser on behalf of the Trust
are property of the Trust and will be surrendered promptly to the Trust on
request.
7. Liability of the Investment Adviser.
The Investment Adviser shall not be liable for any error of judgment or
for any loss suffered by the Trust in connection with performance of its
obligations under this Agreement, except a loss, resulting from willful
misfeasance, bad faith or gross negligence on its part in the performance of,
or from reckless disregard by it of its obligations an duties under, this
Agreement, or damages resulting from a breach of fiduciary duty with respect
to receipt of compensation for services or another breach of this Agreement.
8. Indemnification.
The Trust will indemnify the Investment Adviser for all liabilities and
reasonable expenses, including reasonable attorney's fees, in connection with
any litigation pertaining to the period prior to the Investment Advisor's
relationship with the Trust under the Investment Advisory Agreement dated May
21, 1992, other than liabilities resulting from willful misfeasance, bad faith
or gross negligence on the part of the Investment Adviser; however, the Trust
shall have the right to defend such litigation and to retain counsel that is
reasonably acceptable to the Investment Adviser.
9. Permissible Interests.
Partners, officers and agents of the Investment Adviser are or may be
interested in the Trust as Trustees, officers, shareholders or otherwise; and
the Investment Adviser (or any successor thereof)is or may be interested in
the Trust as a shareholder or otherwise.
10. Duration and Termination.
Unless sooner terminated as provided herein, this Agreement shall
continue until May , 1999, and thereafter for periods of one year, so long
as such continuance thereafter is specifically approved at least annually by
the vote of a majority of the Trustees of the Trust, including a majority of
the Trustees who are not parties to this Agreement or interested persons of
the Investment Adviser or any principal underwriter of the Trust, cast in
person at a meeting called for the purpose of voting on such approval or by
the vote of a majority of the outstanding voting securities of the Trust. The
foregoing 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 at any time without the payment of any penalty by the vote of a
majority of the Trustees of the Trust or by the vote of a majority of the
outstanding voting securities of the Trust on 60 days' written notice to the
Investment Adviser or by the Investment Adviser at any time without the
payment of any penalty on 90 days' written notice to the Trust. This
Agreement will automatically and immediately terminate in the event of its
assignment. Any notice under this Agreement shall be given in writing,
addressed and delivered, or mailed postpaid, to the other party at any office
of such party. As used in Section 10, the terms "assignment," "interested
person," and "vote of a majority of the outstanding voting securities" shall
have the respective meanings set forth in the 1940 Act and the rules and
regulations thereunder, subject to such exceptions as may be granted by the
Securities and Exchange Commission under the 1940 Act.
11. Amendment; Waiver.
No provisions 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, and no amendment of this Agreement shall be effective until approved
by the vote of the majority of the outstanding voting securities of the Trust.
12. Claims Against the Trust.
It is understood and expressly stimulated that none of the Trustees or
participants of the Trust shall be personally liable hereunder. Neither the
Trustees, officers, agents nor participants of the Trust assume any personal
liability for obligations entered into on behalf of the Trust. All persons
dealing with the Trust must look solely to the property of the Trust for the
enforcement of any claim against the Trust.
13. Governing Law; Severability; Counterparts.
This Agreement shall be governed by and construed in accordance with the
laws of the Commonwealth of Massachusetts. 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 shall not be affected thereby. This Agreement
may be executed in any number of counterparts, each of which shall be deemed
to be an original, but such counterpart shall, together, constitute only one
instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and year first written above.
AMERICAN FEDERATION OF LABOR
AND CONGRESS OF INDUSTRIAL
ORGANIZATIONS HOUSING INVESTMENT
WELLINGTON MANAGEMENT COMPANY, LLP TRUST
By: /s/ Xxxxxx X. XxXxxxxxx By: /s/ Xxxxx Xxxxxxxx
------------------------- ----------------------------
Xxxxxx X. XxXxxxxxx Xxxxx Xxxxxxxx
President General Counsel, AFL-CIO
Housing Investment Trust
SCHEDULE A
The Investment Adviser may invest in the following types of securities,
and such other types of securities that the Trust's Board of Trustees may
authorize from time to time upon giving written notice to the Investment
Adviser, consistent with the Trust's Registration Statement. The duration of
any security in the Short/Intermediate-Term Assets shall not exceed 24 months.
1. United States Treasury issues;
2. Federal Agency issues;
3. Commercial bank time certificates of deposit of banks whose accounts are
insured by the Federal Deposit Insurance Corporation through its Bank
Insurance Fund ("BIF");
4. Savings bank deposits insured by the Federal Deposit Insurance Corporation
through BIF;
5. Savings and loan association deposits insured by the Federal Deposit
Insurance Corporation through its Savings Association Insurance Fund;
6. Bankers acceptances;
7. Commercial paper rated as category A-1 or P-1 by Standard & Poor's
Corporation ("S&P") or Xxxxx'x Investors Service, Inc. ("Moody's");
8. Collateral loans (not including warehousing agreements) secured by Federal
Housing Administration or Veterans Administration guaranteed single-family
or multi-family mortgages;
9. Interests (including repurchase agreements) in United States Government
securities pledged by a bank or other borrower to secure short-term loans
from the Trust; and
10. Securities issued by an investment company registered under the Investment
Company Act of 1940, as amended, that invests predominantly in United
States Treasury issues or Federal agency issues.
