EXHIBIT 99(D)
INVESTMENT ADVISORY AGREEMENT
AGREEMENT, made this 2nd day of July, 1998, between St. Clair Funds,
Inc. ("St. Clair") on behalf of each Fund (collectively, the "Funds") set
forth on Schedule A attached hereto, and Munder Capital Management (the
"Advisor"), a Delaware partnership.
WHEREAS, St. Clair is a Maryland corporation authorized to issue shares
in series and is registered as an open-end management investment company
under the Investment Company Act of 1940, as amended (the "1940 Act"), and
each Fund is a series of St. Clair;
WHEREAS, the Advisor is registered as an investment advisor under the
Investment Advisers Act of 1940, as amended (the "Advisers Act"); and
WHEREAS, St. Clair wishes to retain the Advisor to render investment
advisory services to the Funds, and the Advisor is willing to furnish such
services to the Funds;
NOW, THEREFORE, in consideration of the promises and mutual covenants
herein contained, it is agreed between St. Clair and the Advisor as follows:
1. APPOINTMENT
(a) St. Clair hereby appoints the Advisor to act as investment advisor to
the Funds for the periods and on the terms set forth herein. The Advisor accepts
the appointment and agrees to furnish the services set forth herein for the
compensation provided herein.
(b) In the event that St. Clair establishes one or more portfolios other
than the Funds listed on Schedule A attached hereto, with respect to which it
desires to retain the Investment Advisor to act as investment advisor hereunder,
it shall notify the Investment Advisor in writing. If the Investment Advisor is
willing to render such services under this Agreement it shall notify St. Clair
in writing whereupon such portfolio shall become a Fund hereunder and shall be
subject to the provisions of this Agreement to the same extent as the Fund named
above except to the extent that said provisions (including those relating to the
compensation payable by the Fund to the Investment Advisor) are modified with
respect to such Fund in writing by St. Clair and the Investment Advisor at the
that time.
2. SERVICES AS INVESTMENT ADVISOR
Subject to the general supervision and direction of the Board of Directors
of St. Clair, the Advisor will (a) provide overall management to the Funds in
accordance with each Fund's investment objective and policies as stated in the
Fund's Prospectus and the Statement of Additional Information filed with the
Securities and Exchange Commission, as they may be amended from time to time;
(b) make investment decisions for the Funds; (c) oversee the placement of
purchase and sale orders on behalf of the Funds; (d) employ professional
portfolio managers and securities analysts to provide research services to the
Funds; (e) maintain books and records with respect to each Fund's securities
transactions; and (f) provide periodic and special reports to the Board of
Directors of St. Clair, as requested. In providing those services, the Advisor
will provide the Funds with ongoing research, analysis, advice and judgments
regarding individual investments, general economic conditions and trends and
long-range investment policy. In addition, the Advisor will furnish the Funds
with whatever
statistical information the Funds may reasonably request with respect to the
securities that the Funds may hold or contemplate purchasing.
The Advisor further agrees that, in performing its duties hereunder, it
will:
(a) comply with the 1940 Act and all rules and regulations thereunder and
under the Advisers Act, the Internal Revenue Code of 1986, as amended (the
"Code"), and all other applicable federal and state law and regulations, and
with any applicable procedures adopted by the Trustees;
(b) use reasonable efforts to manage each Fund so that it will qualify,
and continue to qualify, as a regulated investment company under Subchapter M of
the Code and regulations issued thereunder;
(c) maintain books and records with respect to each Fund's securities
transactions, render to the Board of Directors of St. Clair such periodic and
special reports as the Board may reasonably request, and keep the Trustees
informed of developments materially affecting each Fund's portfolio;
(d) make available to the Funds' administrator and St. Clair, promptly
upon their request, such copies of its investment records and ledgers with
respect to the Funds as may be required to assist the administrator and St.
Clair in their compliance with applicable laws and regulations. The Advisor will
furnish the Directors with such periodic and special reports regarding the Funds
as they may reasonably request; and
(e) immediately notify St. Clair in the event that the Advisor or any of
its affiliates: (1) becomes aware that it is subject to a statutory
disqualification that prevents the Advisor from serving as investment advisor
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 Advisor further agrees to notify
St. Clair immediately of any material fact known to the Advisor respecting or
relating to the Advisor that is not contained in St. Clair's Registration
Statement regarding the Funds, 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.
3. DOCUMENTS
St. Clair has delivered properly certified or authenticated copies of
each of the following documents to the Advisor and will deliver to it all
future amendments and supplements thereto, if any:
(a) certified resolution of the Board of Directors of St. Clair
authorizing the appointment of the Advisor and approving the form of this
Agreement;
(b) the Registration Statement describing the Fund as filed with the
Securities and Exchange Commission and any amendments thereto; and
(c) exhibits, powers of attorneys, certificates and any and all other
documents relating to or filed in connection with the Registration Statement
described above.
2
4. BROKERAGE
In selecting brokers or dealers to execute transactions on behalf of the
Funds, the Advisor will use its best efforts to seek the best overall terms
available. In assessing the best overall terms available for any Fund
transaction, the Advisor will consider all factors it deems relevant, including,
but not limited to, the breadth of the market in the security, the price of the
security, the financial condition and execution capability of the broker or
dealer and the reasonableness of the commission, if any, for the specific
transaction and on a continuing basis. In selecting brokers-dealers to execute a
particular transaction, and in evaluating the best overall terms available, the
Advisor is authorized to consider the brokerage and research services (as those
terms are defined in Section 28(e) of the Securities Exchange Act of 1934, as
amended (the "1934 Act")) provided to the Funds and/or other accounts over which
the Advisor or its affiliates exercise investment discretion. The parties hereto
acknowledge that it is desirable for St. Clair that the Advisor have access to
supplemental investment and market research and security and economic analysis
provided by brokers-dealers who may execute brokerage transactions at a higher
cost to St. Clair than may result when allocating brokerage to other brokers on
the basis of seeking the most favorable price and efficient execution.
Therefore, the Advisor may cause the Fund to pay a broker-dealer which furnishes
brokerage and research services a higher commission than that which might be
charged by another broker-dealer for effecting the same transaction, provided
that the Advisor determines in good faith that such commission is reasonable in
relation the value of the brokerage and research services provided by such
broker-dealer, viewed in terms of either the particular transaction or the
overall responsibilities of the Advisor to the Fund. It is understood that the
services provided by such brokers may be useful to the Advisor in connection
with the Advisor's services to other clients. In accordance with Section 11(a)
of the 1934 Act and Rule 11a2-2(T) thereunder and subject to any other
applicable laws and regulations, the Advisor and its affiliates are authorized
to effect portfolio transactions for the Funds and to retain brokerage
commissions on such transactions.
5. RECORDS
The Advisor agrees to maintain and to preserve for the periods prescribed
under the 1940 Act any such records as are required to be maintained by the
Advisor with respect to the Funds by the 1940 Act. The Advisor further agrees
that all records which it maintains for the Funds are the property of the Funds
and it will promptly surrender any of such records upon request.
6. STANDARD OF CARE
The Advisor shall exercise its best judgment in rendering the services
under this Agreement. The Advisor shall not be liable for any error of judgment
or mistake of law or for any loss suffered by a Fund or the Funds' shareholders
in connection with the matters to which this Agreement relates, provided that
nothing herein shall be deemed to protect or purport to protect the Advisor
against any liability to a Fund or to its shareholders to which the Advisor
would otherwise be subject by reason of willful misfeasance, bad faith or gross
negligence on its part in the performance of its duties or by reason of the
Advisor's reckless disregard of its obligations and duties under this Agreement.
As used in this Section 6, the term "Advisor" shall include any officers,
Directors, employees, or other affiliates of the Advisor performing services
with respect to a Fund.
3
7. COMPENSATION
In consideration of the services rendered pursuant to this Agreement, each
Fund will pay the Advisor a fee as set forth on Schedule B attached hereto. This
fee shall be computed and accrued daily and payable monthly; however, with
respect to any Fund for which the effective date of this Agreement is prior to
November 30, 1998, the fee shall be maintained in an interest-bearing escrow
account until such time as shareholders of the Fund approve the payment of fees
pursuant to this agreement. If shareholders do not approve such payment of fees
on or before November 30, 1998, the balance in the escrow account shall be paid
to the Fund. For the purpose of determining fees payable to the Advisor, the
value of a Fund's average daily net assets shall be computed at the times and in
the manner specified in the Fund's Prospectus or Statement of Additional
Information.
8. EXPENSES
The Advisor will bear all expenses in connection with the performance of
its services under this Agreement and will bear the costs and expenses payable
to Sub-Advisors under the Sub-Advisory Agreements. Each Fund will bear certain
other expenses to be incurred in its operation, including: taxes, interest,
brokerage fees and commissions, if any, fees of Directors of St. Clair who are
not officers, Directors or employees of the Advisor or any Sub-Advisor;
Securities and Exchange Commission fees and state blue sky fees; charges of
custodians and transfer and dividend disbursing agents; the Fund's proportionate
share of insurance premiums; outside auditing and legal expenses; costs of
maintenance of the Fund's existence; costs attributable to investor services,
including, without limitation, telephone and personal expenses; charges of an
independent pricing service, costs of preparing and printing prospectuses and
statements of additional information for regulatory purposes and for
distribution to existing shareholders; costs of shareholders' reports and
meetings of the shareholders of the Fund and of the officers of Board of
Directors of St. Clair; and any extraordinary expenses.
9. SERVICES TO OTHER COMPANIES OR ACCOUNTS
The investment advisory services of the Advisor to the Funds under this
Agreement are not to be deemed exclusive, and the Advisor, or any affiliate
thereof, shall be free to render similar services to other investment companies
and clients (whether or not their investment objective and policies are similar
to those of a Fund) and to engage in activities so long as its services
hereunder are not impaired thereby.
10. DURATION AND TERMINATION
This Agreement shall become effective on the date of this Agreement
provided that with respect to any Fund, this Agreement shall not take effect
unless it has been approved (a) by a vote of a majority of the Board of
Directors of the Company including a majority of those Directors who are not
"interested persons" (as defined in the ▇▇▇▇ ▇▇▇) of any party to this Agreement
cast in person at a meeting called for the purpose of voting on such approval
and (b) by vote of a majority of that Fund's outstanding voting securities and
shall continue in effect with respect to the Fund, unless sooner terminated as
provided herein, for two years from such date and shall continue from year to
year thereafter, provided each continuance is specifically approved at least
annually by (i) the vote of a majority of the Board of Directors of St. Clair or
(ii) a vote of a "majority" (as defined in the ▇▇▇▇ ▇▇▇) of the Fund's
outstanding voting securities, provided that in either event the continuance is
also approved by a majority of the Board of Directors who are not "interested
persons" (as defined in the ▇▇▇▇ ▇▇▇) of any party to this
4
Agreement, by vote cast in person at a meeting called for the purpose of voting
on such approval. This Agreement is terminable with respect to the Funds, or any
Fund, without penalty, on sixty (60) days' written notice by the Board of
Directors of St. Clair or by vote of the holders of a "majority" (as defined in
the ▇▇▇▇ ▇▇▇) of the shares of the affected Funds or upon ninety (90) days'
written notice by the Advisor. Termination of this Agreement with respect to any
given Fund, shall in no way affect the continued validity of this Agreement or
the performance thereunder with respect to any other Fund. This Agreement will
be terminated automatically in the event of its "assignment" (as defined in the
1940 Act).
11. AMENDMENT
No provision of this Agreement may be changed, waived or 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 with respect to any Fund shall be
effective until approved by an affirmative vote of (i) a majority of the
outstanding voting securities of that Fund, and (ii) a majority of the Trustees
of the Trust, including a majority of Trustees who are not "interested persons"
(as defined in the ▇▇▇▇ ▇▇▇) of any party to this Agreement, cast in person at a
meeting called for the purpose of voting on such approval, if such approval is
required by applicable law.
12. USE OF NAME
It is understood that the name of Munder Capital Management or any
derivative thereof or logo associated with that name is the valuable property of
the Advisor and its affiliates, and that St. Clair and each Fund have the right
to use such name (or derivable or logo) only so long as this Agreement shall
continue with respect to a given Fund. Upon termination of this Agreement, or
upon termination of this Agreement with respect to a given Fund, St. Clair and
any affected Fund shall forthwith cease to use such name (or derivable or logo)
and St. Clair shall promptly amend its Articles of Incorporation to change the
Fund name to comply herewith.
13. MISCELLANEOUS
(a) This Agreement constitutes the full and complete agreement of the
parties hereto with respect to the subject matter hereof.
(b) Titles or captions of sections in this Agreement are inserted only as
a matter of convenience and for reference, and in no way define, limit, extend
or describe the scope of this Agreement or the intent of any provisions thereof.
(c) This Agreement may be executed in several counterparts, all of which
together shall for all purposes constitute one Agreement, binding on all the
parties.
(d) This Agreement and the rights and obligations of the parties hereunder
shall be governed by, and interpreted, construed and enforced in accordance with
the laws of the State of Michigan.
(e) If any provisions of this Agreement or the application thereof to any
party or circumstances shall be determined by any court of competent
jurisdiction to be invalid or unenforceable to any extent, the remainder of this
Agreement or the application of such provision to such person circumstance,
other than these as to which it so determined to be invalid or unenforceable,
shall not be affected thereby, and each provision hereof shall be valid and
shall be enforced to the fullest extent permitted by law.
5
(f) Notices of any kind to be given to the Advisor by the Trust shall be
in writing and shall be duly given if mailed or delivered to the Advisor at ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, or at such other address or to such
individual as shall be specified by the Advisor to the Trust. Notices of any
kind to be given to the Trust by the Advisor shall be in writing and shall be
duly given if mailed or delivered to ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇▇, or at such the address to such individual as shall be specified by the
Trust to the Advisor.
6
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed by their officers designated below on the day and year first above
written.
ST. CLAIR FUNDS, INC.
By: /S/ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
----------------------------
MUNDER CAPITAL MANAGEMENT
By: /S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------
7
SCHEDULE A
Munder Institutional S&P Index Equity Fund
Munder Institutional S&P MidCap Index Equity Fund
Munder Institutional S&P SmallCap Index Equity Fund
Munder Institutional Short Term Treasury Fund
Munder Institutional Money Market Fund
Munder S&P 500 Index Equity Fund
Munder S&P MidCap Index Equity Fund
Munder S&P SmallCap Index Equity Fund
Munder Foreign Equity Fund
Munder Aggregate Bond Index Fund
Liquidity Plus Money Market Fund
8
SCHEDULE B
FUND ANNUAL FEES (AS A PERCENTAGE OF
AVERAGE DAILY NET ASSETS)
--------------------------------
Munder Institutional S&P 500 Index Equity Fund 0.07%
Munder Institutional S&P MidCap Index Equity Fund 0.15%
Munder Institutional S&P SmallCap Index Equity Fund 0.15%
Munder Institutional Short Term Treasury 0.20%
Munder Institutional Money Market 0.20%
Liquidity Plus Money Market Fund 0.35%
Munder S&P 500 Index Equity Fund 0.05%
Munder S&P MidCap Index Equity Fund 0.05%
Munder S&P SmallCap Index Equity Fund 0.05%
Munder Foreign Equity Fund 0.05%
Munder Aggregate Bond Index Fund 0.05%
9