CMC FUND TRUST
CMC FIXED INCOME SECURITIES FUND
INVESTMENT ADVISORY CONTRACT
This Agreement is made the __th day of __________, 2000 between CMC
FUND TRUST, an Oregon business trust, (the "Fund") and COLUMBIA MANAGEMENT CO.,
an Oregon corporation having its principal place of business in Portland, Oregon
(the "Adviser"). The Fund is registered as an open-end investment company
pursuant to the Investment Company Act of 1940 (the "Act"). The Adviser is
registered as an investment adviser pursuant to the Investment Advisers Act of
1940. The Fund has established a sixth series of shares, referred to as "CMC
Fixed Income Securities Fund" (the "Series"), and this Agreement relates to
services to be performed by the Adviser with respect to that Series.
The parties agree as follows:
1. Duties of Adviser. With respect to the Series, the Adviser shall
regularly provide the Fund with research, advice, and supervision with respect
to investment matters and shall furnish continuously an investment program,
recommend what securities shall be purchased or sold and what portion of the
Fund's assets shall be held invested or uninvested, subject always to the
provisions of the Act and the Fund's Declaration of Trust and Bylaws, and
amendments thereto, which amendments shall be furnished to the Adviser by the
Fund. The Adviser shall take any steps necessary or appropriate to carry out its
decisions in regard to the foregoing matters and the general conduct of the
business of the Fund. The Adviser may take into consideration receipt of
research and statistical information and other services rendered to the Fund in
the allocation of commissions from portfolio brokerage business.
2. Allocation of Charges and Expenses.
(a) With respect to the Series, the Adviser shall pay or reimburse the
Fund for payments made by the Fund for all executive salaries and executive
expenses, office rent of the Fund, ordinary office expenses (other than the
expense of clerical services relating to the administration of the Fund), and
for any other expenses that, if otherwise borne by the Fund, would cause the
Fund to "be deemed to be acting as a distributor of securities of which it is
the issuer, other than through an underwriter," pursuant to Rule 12b-1 under the
Act. The Adviser shall provide investment advisory, statistical, and research
facilities and all clerical services relating to research, statistical, and
investment work with respect to the Series.
(b) The Adviser shall not be required to pay any expenses of the Fund
other than those enumerated in this Agreement. The Fund will assume all other
costs, including the cost of its custodian, legal, auditing, and accounting
expenses, disinterested directors' fees, taxes, and governmental fees, interest,
brokers' commissions, transaction expenses, cost of stock certificates, and any
other expenses (including clerical expenses) of issue, sale, repurchase, or
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redemption of shares, expenses of registering or qualifying shares for sale,
transfer taxes, and all expenses of preparing the Fund's registration statement
and prospectus, and the cost of printing and delivering to shareholders
prospectuses and reports.
(c) At the request of the Fund, the Adviser shall pay all or a portion
of the direct and indirect costs, charges and expenses of or related to the
Fund's business and operations. The Adviser will submit to the Fund on a monthly
basis a statement setting forth the cost, charges and expenses paid by the
Adviser for the previous month. Upon receipt of the statement, the Fund shall
promptly reimburse the Adviser for the costs, charges and expenses.
3. Compensation of the Adviser. For the services to be rendered, the
facilities to be furnished, and the payments to be made by the Adviser, as
provided in Sections 1 and 2 hereof, for each calendar month the Fund shall pay
to the Adviser a fee computed at the annual rate of .35 of 1 percent of daily
net assets of the Series. If the asset value is not required to be determined on
any particular business day, then for the purposes of this Section 3, the asset
value of a share as last determined shall be deemed to be the asset value of a
share as of the close of business on that day. If there is no business day in
any calendar month, the fee shall be computed on the basis of the asset value of
a share as last determined, multiplied by the average number of shares
outstanding on the last day of the month.
4. Covenants of the Adviser. In connection with purchases or sales of
portfolio securities for the account of the Fund, neither the Adviser nor any
officer, director, or employee of the Adviser shall act as a principal. The
Adviser covenants that it and its employees will comply with investment
restrictions of the Fund's Bylaws applicable to them. If the Adviser or any of
its affiliates give any advice to clients concerning the shares of the Fund, it
will act solely as investment counsel for the clients and not on behalf of the
Fund.
5. Limitation on Liability of Adviser. The Adviser shall not be liable
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, except a loss
resulting from willful malfeasance, bad faith, or gross negligence on the part
of the Adviser in the performance of its duties or from reckless disregard by
the Adviser of its obligations and duties under this Agreement. The federal
securities laws impose liabilities under certain circumstances on persons who
act in good faith, and therefore nothing herein shall in any way constitute a
waiver or limitation of any rights which the Fund may have under any federal
securities laws.
6. Duration and Termination of this Agreement.
(a) This Agreement shall remain in force for two years from the date
hereof, and it may be continued from year to year thereafter if approved
annually by a vote of a majority of the Fund's shareholders or by its trustees
and in either case a vote of a majority of the trustees 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.
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(b) This Agreement may be terminated at any time without the payment of
any penalty by vote of the trustees of the Fund, by vote of a majority of the
outstanding shares of the Fund, or by the Adviser, on 60 days written notice to
the other party.
(c) This Agreement shall automatically terminate if it is assigned. The
Adviser shall notify the Fund of any change in the officers or directors of the
Adviser within a reasonable time after the change. The terms "assignment," "vote
of a majority of the outstanding voting securities", and "interested persons"
shall have the meanings specified in the Act.
7. Applicable to Specific Series. The Adviser agrees that, with respect
to any obligation of the Fund under this Agreement, the Adviser shall look only
to the assets of the Series to which this Agreement relates.
IN WITNESS WHEREOF the parties have caused this Agreement to be
executed as of the day and year first written above.
CMC FUND TRUST
By
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Title: President
COLUMBIA MANAGEMENT CO.
By
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Title: Senior Vice President
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