1
EXHIBIT (D)(III)
GROWTH AND INCOME PORTFOLIO
OF
ENTERPRISE ACCUMULATION TRUST
PORTFOLIO MANAGER'S AGREEMENT
THIS AGREEMENT, made the 1st day of November 1998, is among Enterprise
Accumulation Trust (the "Fund"), a Massachusetts business trust, Enterprise
Capital Management, Inc., a Georgia corporation (hereinafter referred to as the
"Adviser"), and Retirement System Investors Inc., a Delaware corporation,
(hereinafter referred to as the "Portfolio Manager").
BACKGROUND INFORMATION
(A) The Adviser has entered into an Investment Adviser's Agreement
dated as of May 1, 1993 with the Fund ("Investment Adviser's Agreement).
Pursuant to the Investment Adviser's Agreement, the Adviser has agreed to render
investment advisory and certain other management services to all of the
Portfolios of the Fund, and the Fund has agreed to employ the Adviser to render
such services and to pay to the Adviser certain fees therefore. The Investment
Adviser's Agreement recognizes that the Adviser may enter into agreements with
other investment advisers who will serve as Portfolio Managers to the Portfolios
of the Fund.
(B) The parties hereto wish to enter into an agreement whereby the
Portfolio Manager will provide to the Growth and Income Portfolio of the Fund
(the "Growth and Income Portfolio") securities investment advisory services for
that Portfolio.
WITNESSETH THAT:
In consideration of the mutual covenants herein contained, the Fund,
Adviser and the Portfolio Manager agree as follows:
(1) The Fund and Adviser hereby employ the Portfolio Manager
to render certain investment advisory services to the Portfolio, as set
forth herein. The Portfolio Manager hereby accepts such employment and
agrees to perform such services on the terms herein set forth, and for
the compensation herein provided.
(2) The Portfolio Manager shall furnish the Growth and Income
Portfolio advice with respect to the investment and reinvestment of the
assets of the Growth and Income Portfolio, or such portion of the
assets of the Portfolio as the Adviser shall specify from time to time,
in accordance with the investment objectives, restrictions and
limitations of the Portfolio as set forth in the Fund's most recent
Registration Statement.
(3) The Portfolio Manager shall perform a monthly
reconciliation of the Portfolio to the holdings report provided by the
Fund's custodian and bring any material or significant variances
regarding holdings or valuations to the attention of the Adviser.
(4) The Portfolio Manager shall for all purposes herein be
deemed to be an independent contractor. The Portfolio Manager has no
authority to act for or represent the Fund or the
2
Portfolios in any way except to direct securities transactions pursuant
to its investment advice hereunder. The Portfolio Manager is not an
agent of the Fund or the Portfolio.
(5) It is understood that the Portfolio Manager does not, by
this Agreement, undertake to assume or pay any costs or expenses of the
Fund or the Portfolio.
(6) (a) The Adviser agrees to pay the Portfolio Manager for
its services to be furnished under this Agreement, with respect to each
calendar month after the effective date of this Agreement, on the
twentieth (20th) day after the close of each calendar month, a sum
equal to 0.025 of 1% of the average of the daily closing net asset
value of the Portfolio managed by the Portfolio Manager during such
month (that is, 0.30 of 1% per year) for the first $100,000,000 of
assets under management; a sum equal to 0.0208 of 1% of the average of
the daily closing net asset value of the Portfolio during such month
(that is, 0.25% per year) for the next $100,000,000; and a sum equal to
0.0167 of 1% of the average of the daily closing net asset value of the
Portfolio during such month (that is, 0.20 of 1% per year) for assets
in excess of $200,000,000.
(6) (b) The payment of all fees provided for hereunder shall
be prorated and reduced for sums payable for a period less than a full
month in the event of termination of this Agreement on a day that is
not the end of a calendar month.
(6) (c) For the purposes of this Paragraph 6, the daily
closing net asset values of the Portfolio shall be computed in the
manner specified in the Registration Statement for the computation of
the value of such net assets in connection with the determination of
the net asset value of the Portfolio's shares.
(7) The services of the Portfolio Manager hereunder are not to
be deemed to be exclusive, and the Portfolio Manager is free to render
services to others and to engage in other activities so long as its
services hereunder are not impaired thereby. Without in any way
relieving the Portfolio Manager of its responsibilities hereunder, it
is agreed that the Portfolio Manager may employ others to furnish
factual information, economic advice and/or research, and investment
recommendations, upon which its investment advice and service is
furnished hereunder.
(8) In the absence of willful misfeasance, bad faith or gross
negligence in the performance of its duties hereunder, or reckless
disregard of its obligations and duties hereunder, the Portfolio
Manager shall not be liable to the Fund, the Portfolio or the Adviser
or to any shareholder or shareholders of the Fund, the Portfolio or the
Adviser for any mistake of judgment, act or omission in the course of,
or connected with, the services to be rendered by the Portfolio Manager
hereunder.
(9) The Portfolio Manager will take necessary steps to prevent
the investment professionals of the Portfolio Manager who are
responsible for investing assets of the Portfolio from taking, at any
time, a short position in any shares of any holdings of any Portfolios
of the Fund for any accounts in which such individuals have a
beneficial interest, excluding short positions, including without
limitation, short against-the-box positions, effected for tax reasons.
The Portfolio Manager also will cooperate with the Fund in adopting a
written policy prohibiting ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ with respect to Fund
Portfolio transactions insofar as such transactions may relate to the
Portfolio Manager.
2
3
(10) In connection with the management of the investment and
reinvestment of the assets of the Portfolio, the Portfolio Manager is
authorized to select the brokers or dealers that will execute purchase
and sale transactions for the Portfolio, and is directed to use its
best efforts to obtain the best available price and most favorable
execution with respect to such purchases and sales of portfolio
securities for the Fund. Subject to this primary requirement, and
maintaining as its first consideration the benefits for the Portfolio
and its shareholders, the Portfolio Manager shall have the right,
subject to the approval of the Board of Trustees of the Fund and of the
Adviser, to follow a policy of selecting brokers and dealers who
furnish statistical research and other services to the Portfolio, the
Adviser, or the Portfolio Manager and, subject to the Conduct Rules of
the National Association of Securities Dealers, Inc., to select brokers
and dealers who sell shares of Portfolio of the Fund.
(11) The Fund may terminate this Agreement by thirty (30) days
written notice to the Adviser and the Portfolio Manager at any time,
without the payment of any penalty, by vote of the Fund's Board of
Directors, or by vote of a majority of its outstanding voting
securities. The Adviser may terminate this Agreement by thirty (30)
days written notice to the Portfolio Manager and the Portfolio Manager
may terminate this Agreement by thirty (30) days written notice to the
Adviser, without the payment of any penalty. This Agreement shall
immediately terminate in the event of its assignment, unless an order
is issued by the Securities and Exchange Commission conditionally or
unconditionally exempting such assignment from the provision of Section
15 (a) of the Investment Company Act of 1940, in which event this
Agreement shall remain in full force and effect.
(12) Subject to prior termination as provided above, this
Agreement shall continue in force from the date of execution until
October 1, 1999 and from year to year thereafter if its continuance
after said date: (1) is specifically approved on or before said date
and at least annually thereafter by vote of the Board of Trustees of
the Fund, including a majority of those trustees who are not parties to
this Agreement of interested persons of any such party, or by vote of a
majority of the outstanding voting securities of the Fund, and (2) is
specifically approved at least annually by the vote of a majority of
Trustees of the Fund who are not parties to this Agreement or
interested persons of any such party cast in person at a meeting called
for the purpose of voting on such approval.
(13) The Adviser shall indemnify and hold harmless the
Portfolio Manager, its officers and directors and each person, if any,
who controls the Portfolio Manager within the meaning of Section 15 of
the Securities Act of 1933 (any and all such persons shall be referred
to as "Indemnified Party"), against any loss, liability, claim, damage
or expense (including the reasonable cost of investigating or defending
any alleged loss, liability, claim, damages or expense and reasonable
counsel fees incurred in connection therewith), arising by reason of
any matter to which this Portfolio Manager's Agreement relates.
However, in no case (i) is this indemnity to be deemed to protect any
particular Indemnified Party against any liability to which such
Indemnified Party would otherwise be subject by reason of willful
misfeasance, bad faith or gross negligence in the performance of its
duties or by reason of reckless disregard of its obligations and duties
under this Portfolio Manager's Agreement or (ii) is the Adviser to be
liable under this indemnity with respect to any claim made against any
particular Indemnified Party unless such Indemnified Party shall have
notified the Adviser in writing within a reasonable time after the
summons or other first legal process giving information of the nature
of the claim shall have been served upon the Portfolio Manager or such
controlling persons.
3
4
The Portfolio Manager shall indemnify and hold harmless the Adviser
and each of its trustees and officers and each person if any who
controls the Adviser within the meaning of Section 15 of the Securities
Act of 1933, against any loss, liability, claim, damage or expense
described in the foregoing indemnity, but only with respect to the
Portfolio Manager's willful misfeasance, bad faith or gross negligence
in the performance of its duties under this Portfolio Manager's
Agreement. In case any action shall be brought against the Adviser or
any person so indemnified, in respect of which indemnity may be sought
against the Portfolio Manager, the Portfolio Manager shall have the
rights and duties given to the Adviser, and the Adviser and each person
so indemnified shall have the rights and duties given to the Portfolio
Manager by the provisions of subsection (i) and (ii) of this section.
(14) Except as otherwise provided in paragraph 13 hereof and
as may be required under applicable federal law, this Portfolio
Manager's Agreement shall be governed by the laws of the State of
Georgia.
(15) The Portfolio Manager agrees to notify the parties within
a reasonable period of time regarding a material change in the
membership of the Portfolio Manager.
(16) The terms "vote of a majority of the outstanding voting
securities," "assignment" and "interested persons," when used herein,
shall have the respective meanings specified in the Investment Company
Act of 1940 as now in effect or as hereafter amended.
IN WITNESS WHEREOF, the parties have caused this Agreement to be signed
by their duly authorized officers and their corporate seals hereunder duly
affixed and attested, as of the date first above written.
ENTERPRISE ACCUMULATION TRUST
(SEAL)
ATTEST: /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
--------------------------- ------------------------------------
Secretary ▇▇▇▇▇▇ ▇▇▇▇▇▇, Chairman, President
and Chief Executive Officer
ENTERPRISE CAPITAL MANAGEMENT, INC.
(SEAL)
ATTEST: /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
--------------------------- ------------------------------------
Secretary ▇▇▇▇▇▇ ▇▇▇▇▇▇, Chairman, President
and Chief Executive Officer
RETIREMENT SYSTEM INVESTORS INC.
(SEAL)
ATTEST: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
--------------------------- ------------------------------------
Secretary
4
