HomeMy WebLinkAboutDalton, Greiner, Hartman, Maher & Co, LLC Investment Management Agreement -2009 03 26DALTON, GREINER, HARTMAN, MAHER & CO., LLC
INVESTMENT MANAGEMENT AGREEMENT
THIS AGREEMENT, made as of the rna.r~``.~ "a.~, 2009 by and between City of Winter
Springs (hereinafter called "Client") and Dalton, Greiner, Hartman, Maher & Co. LLC
(hereinafter called "Manager"), a Delaware limited liability company, located at 565 Fifth
Avenue, Suite 2101, New York, NY 10017.
WHEREAS, Client is authorized to appoint an investment manager and desires to appoint an
investment manager to supervise and direct the investment and reinvestment of a portion of
the assets of Defined Benefit Plan and Trust for Employees of the City of Winter Springs
("Plan").
NOW, THEREFORE, for and in consideration of the premises and of the mutual covenants
herein contained, Client and Manager agree as follows:
Appointment and Status as Investment Manager. Client hereby appoints Manager as an
Investment Manager. Manager accepts the appointment and by its execution of this
Agreement, Manager represents and warrants that: (a) it is registered as an investment
adviser under the Investment Advisers Act of 1940; (b) Client and Plan are subject to the
Employee Retirement Income Security Act of 1974, as amended, ("FRIBA");(c) Manager
acknowledges that, as a registered investment adviser, it is a fiduciary to Client and the
Plan, as that term is defined in ERISA §3(21)(A); (d) Manager also acknowledges that it
is an investment manager with respect to the Plan, as such term is defined by §3(38) of
ERISA and during the term of this Agreement it will continue to meet the qualifications for
an investment manager; (e) it has been duly licensed and qualifies as required under
applicable law to enable it to render the services provided for hereunder and shall obtain
and continue all necessary licenses and qualifications in effect during the term hereof; (f)
it has obtained any required bonds and other surety agreements sufficient in amount to
comply with all applicable laws, including Section 412 of ERISA, and that it will maintain
such bonds or surety agreements, in the required amounts, in effect for so long as is
required by law; (g) it is duly authorized and empowered to execute, deliver, and perform
this Agreement and that such action does not conflict with or violate any provision of law,
rule or regulation, contract, or other instrument to which it is a part; (li) neither the
Manager nor any of its affiliates has been convicted of any crime described in Section
411 of ERISA; and (i) the Manager shall notify Client immediately if the Manager ceases
to meet the qualifications for an investment manager or investment advisor, ceases to
possess any required license or qualification, or discontinues any required bond or surety
agreement or if any of the representations above cease to be true on any date on which
this Agreement is in effect.
2. Management Services. Effective on the date first indicated above, and until this
Agreement is terminated as provided under paragraph 10 hereof, Client hereby appoints
Manager as the investment manager (within the meaning of Section 3(38) of ERISA) of
those assets of the Plan designated by Client as subject to Manager's supervision (which
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assets, together with all additions, substitutions and alterations thereto are hereinafter
called the "Assets"). Client hereby delegates to Manager all of their powers, duties and
responsibilities with regard to the investment and reinvestment and hereby appoints
Manager as Client's agent in fact with full authority to buy, sell or otherwise effect
investment transactions, including investment in foreign securities, involving the Assets in
the Plan's name and for the Plan's account. In deciding on a proper investment of the
Assets and investment decisions regarding the Assets, Manager shall at all times act in
conformity with ERISA and all applicable provisions of federal and state law and the
Investment Guidelines attached as Exhibit A. Such Investment Guidelines may be
amended by Client at its sole discretion provided that such amendments are
communicated to Manager in writing. Nothing herein shall be deemed to cause Manager
to become a named fiduciary of the Plan, as that term is defined in ERISA §402(a). By
notice given or caused to be given by Client to Manager, Assets subject to this
Agreement may be added or withdrawn.
Manager shall exercise its powers and perform its duties hereunder for the exclusive
purpose of providing benefits to participants in the Plan and their beneficiaries and
defraying reasonable expenses of administration of the Plan. Manager agrees that, in
the performance of its duties hereunder, it shall use the care, skill, prudence and
diligence under the circumstances then prevailing that a prudent man acting in like
capacity and familiar with such matters would use in the conduct of an enterprise of like
character and with like aims, and shall perform such duties in accordance with the
requirements of ERISA, other applicable laws and regulations, the terms and conditions
of this Agreement, the Investment Guidelines, and the specific directions given from time
to time by Client. Manager shall not engage in or cause the Plan to engage in any
transaction which is prohibited by applicable provisions of ERISA or the Internal Revenue
Code of 1986, as amended, and with respect to which no exemption is available.
3. Custodian. The Assets shall be held at and by Fifth Third Bank (hereinafter called
"Custodian") in it's capacity as Client's Custodian and Manager is authorized to give
instructions to Custodian with respect to all investment decisions regarding the Assets. At
no time will Manager have actual possession of the Assets. Client warrants Custodian will
be capable of accepting electronic institutional instructions. In the event that any cash,
securities or other assets of the Plan are delivered to the Manager, the Manager will
promptly deliver the same over to the Custodian.
4. Acceptance by Manager. The Manager hereby accepts the appointment as investment
manager of the Assets and acknowledges that as a result of such acceptance it is a
fiduciary (as that term is defined in Section 3(21)(A) of ERISA) with respect to the Assets.
The Manager agrees to manage the Assets, satisfy its duties and obligations set forth in
this Agreement, and comply with its fiduciary responsibilities under the provisions of
ERISA. Client and Plan are subject to ERISA.
5. Confidential Information. All information regarding the operations and investments of the
Plan shall be regarded as confidential by Manager subject to the specific provisions of
this agreement regarding the duties of Manager. The Manager agrees that it will not,
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without the consent of Client, disclose, except to Client, any information pertaining to
Client, the Assets, the Plan, the investment program and the identities of the persons
associated therewith, except as may be necessary to comply with applicable laws, rules
and regulations or to effectively perform its obligations and duties under this Agreement.
6. Directions to the Manager. All directions by or on behalf of Client to the Manager,
including amendments to the Investment Guidelines, shall be in writing signed by (a)) the
individual executing this Agreement on behalf of the Client or (b) a duly authorized agent
of Client who shall be identified to Manager in a separate writing.
The Manager shall be fully protected in relying upon any direction in accordance with the
previous paragraph with respect to any instruction, direction or approval of Client.
The Manager shall be fully protected in acting upon any instrument, certificate or
document believed by it to be genuine and to be signed or presented by the proper
person or persons, and the Manager shall be under no duty to make any investigation or
inquiry as to any statement contained in any such writing but may accept the same as
conclusive evidence of the truth and accuracy of the statements therein contained.
7. Proxy Voting. Unless otherwise instructed, Manager shall have power in its discretion to
exercise all voting rights with respect to any or all of the Assets. Manager will exercise
such voting rights in the best interest of the Plan and in accordance with its proxy voting
guidelines. A copy of Manager's proxy voting guidelines will be furnished to Client upon
request.
8. Accounting and Reports. Unless otherwise instructed, Manager will not maintain tax lot
information. Manager shall furnish Client with monthly investment reports showing assets
held, market values, performance and transactions. Unless otherwise instructed,
Manager shall furnish Client with an annual report of proxies voted. All purchases and
sales of securities will be reported daily to Custodian via institutional trade confirmations.
Information for any report required by law shall be furnished at such other times as Client
may reasonably request.
9. Expenses and Compensation. The Manager's fee for services provided in accordance
with the terms of the Agreement shall be payable as shown on Exhibit B. If the
management of the Assets commences or ends at any time other than the beginning
date or end date of a calendar quarter, the fee for such quarter shall be prorated based
on the portion of such calendar quarter during which this Agreement was in force.
10. Resignation or Removal of the Manager. The Manager may be removed by Client or
may resign upon 30 days' notice in writing. On the effective date of the removal or
resignation of the Manager or as soon thereafter as reasonably possible, the Manager
shall provide Client with a final report containing the same information as provided in the
monthly investment report described in paragraph 8 above. If Manager is removed by
Client or Manager resigns, Manager will cooperate with Client in the orderly transfer of
Client's account with Manager.
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11. Assignment. Changes in Organization of Manager. Unless Client expressly consents
thereto, any assignment (as defined in the Investment Advisers Act of 1940) by the
Manager of this Agreement shall automatically terminate this Agreement. If the Manager
hereunder is converted into, merges or consolidates with or sells or transfers
substantially all of its assets or business to another corporation, the resulting corporation
or the corporation to which such sale or transfer has been made shall notify Client of
such sale or transfer and shall become the Manager hereunder only if Client specifically
so consents in writing.
12. Change in Membership. In the event of any change in the membership of Manager,
Manager shall notify Client of such change within a reasonable period, but no longer than
30 days after the time of such change.
13. Severability. Any term or provision of this Agreement which is invalid or unenforceable in
any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity
or unenforceability without rendering invalid or unenforceable the remaining terms or
provisions of this Agreement or affecting the validity or enforceability of any of the terms
or provisions of the Agreement in any other jurisdiction.
14. Investment Authority. Client represents that it has the authority under the Plan to
manage and oversee investment of the Assets and further represents that except as
limited by ERISA, there are no restrictions on the transfer or sale thereof. Client further
agrees not to make any changes in the Assets without notifying the Manager.
15. Brokerage. Client hereby delegates to Manager sole and exclusive authority to designate
the broker or brokers through whom all purchases and sales on behalf of the Plan will be
made. The Manager will determine the rate or rates to be paid for brokerage services
provided to the Plan and shall ensure that any such rates to be paid are reasonable in
connection with the brokerage services to be performed by the broker. It is understood
that rates charged by brokerage firms providing research or other services may at times
be higher than those charged by other brokers who provide more limited services or who
are not considered to provide the same quality of execution, provided that no selected
broker or dealer providing research or other non-transaction related services for the Plan
shall be affiliated with Manager. Notwithstanding the foregoing, when placing orders with
brokers, the Manager will seek to obtain the most favorable price and execution for the
Plan, and in placing such orders, the Manager may consider a number of factors
including, without limitation, the overall direct net economic result to the Plan (including
commissions, which may not be the lowest available but ordinarily should not be higher
than the generally prevailing competitive range), the financial strength and stability of the
broker, the efficiency with which the transaction will be effected, the ability to effect the
transaction at all where a large block is involved and the availability of the broker to stand
ready to execute possibly difficult transactions in the future.
16. Non Exclusive Management. Client understands that the Manager will continue to furnish
investment management and advisory services to others, and that the Manager shall be
at all times free to make recommendations to others which may be the same as or may
be different from those made to the Plan. Client further understands that the Manager, its
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affiliates, and any officer, director, stockholder, employee or any member of their families
may or may not have an interest in the securities whose purchase and sale the Manager
may from time to time recommend under this Agreement. Client agrees that the Manager
may recommend actions with respect to securities which may be the same as or different
from the actions which the Manager, or any officer, director, stockholder, employee or
any member of their families, or other investors may take with respect thereto. Client
agrees that the Manager may refrain from rendering any advice or services concerning
securities of companies in which any of Manager's officers, directors, or employees are
directors or officers, or companies for which Manager acts as financial adviser or in any
capacity that Manager deems confidential, unless Manager determines in its sole
discretion that it may waive this provision.
17. Amendment. This Agreement may be amended at any time by the joint action of the
Client and the Manager in writing.
18. Disputes. In the event of any dispute between the parties under this Agreement, the
venue shall be in Seminole County, Florida for any state court action and Orlando,
Florida for any federal court action.
19. Applicable Law. To the extent not inconsistent with applicable law, this Agreement shall
be subject to Florida law.
20. Notices. Any notices required or permitted to be given in connection with this Agreement
shall be in writing and shall be deemed given when deposited in the U.S. Mail, postage
prepaid or delivered personally, by facsimile, or by an overnight delivery service,
addressed as set forth below, or to such other address as may be specified from time to
time by notice in writing to the other.
To Manager at:
Mr. Bruce Geller
Dalton, Greiner, Hartman, Maher & Co. LLC
565 Fifth Avenue, Suite 2101
New York, NY, 10017
To the Client at:
Name:
Address:
City, State, Zip:
Phone:
Fax:
Email:
Kevin L. Smith, City Manager
1126 East State Road 434
Winter Springs, Florida 32708
(407) 327-5957
(407) 327-4753
ksmithCa~winterspringsfl.org
21. Investment Manager Brochure. Client hereby acknowledges that it has received from
Manager a copy of the Form ADV, Part II, as currently filed with the Securities and
Exchange Commission, at least forty-eight hours prior to entering into this agreement.
Form ADV, Part I is available at the IAPD web site www.adviserinfo.sec.gov.
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IN WITNESS WHEREOF, Client has caused this Agreement to be executed by its duly appointed
officer and Manager has caused this Agreement to be executed by its duly appointed officer as of the
day, month and year first above written.
Dalton, Greiner, Hartman, Maher & Co. LLC Client
By: Bruce H. Gelle
C 'e Executive Officer
By: Kevin L. Smith
:~ir
ity A!lana, er
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EXHIBIT A
INVESTMENT GUIDELINES
1. All funds shall be invested in the Allcap product.
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EXHIBIT B
FEE SCHEDULE
Annual Fee on assets under management:
0.75% per annum
One quarter of the annual fee will be payable at the end of each calendar quarter. Each
quarterly payment shall be calculated as stated above based on the market value of the Assets
at the end of each calendar quarter. In the event the Manager is removed or resigns other than
at the end of a calendar quarter, the market value of the Assets to be used in determining the
fee shall be as of the date of such removal or resignation. The fee for any such partial quarter
shall be pro rated.
Principles of Valuation:
Any valuation of the securities in the Fund pursuant to this Agreement shall be made by Manager. In computing the
value of any security in the Fund for purposes of this Agreement, each security listed on a national securities exchange or the
NASDAQ National Market System shall be valued at the last sale price on the valuation date, and each other security
regularly traded in the over-the-counter market shall be valued at the latest available bid price quotation furnished to Manager
by sources it deems appropriate. Any other Asset shall be valued in such a manner as shall be determined by Manager in its
discretion to reflect its fair market value.
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Exhibit B
SUPPLEMENTAL DISCLOSURE STATEMENT AND CLIENT ACKNOWLEDGEMENT
Dalton, Greiner, Hartman, Maher & Co., LLC (the "Company") and SMH Capital Inc. are parties to a written
agreement whereby SMH introduces and refers prospective clients to the Company and its affiliates in connection
with investment in certain investment products managed by the Company.
The fee to be received by SMH and its representatives from the Company will nat increase the fees that the
Company or its affiliates charges any client for investment adviser services. The fees to be paid to SMH and its
representatives are comprised of
(a) A quarterly retainer;
(b) A percentage of fees received by the Company with respect to assets of clients introduced to the
Company by SMH, including:
- A percentage of the management fees paid to the Company for a period not to exceed ten
years; and
- A percentage of the performance fees paid to the Company for a period not to exceed ten
years.
The specific percentage amounts and retainer to be paid are available upon request to the Chief Executive Officer
or Chief Financial Officer of the Company.
SMH, and its representatives, will not render investment advisory services to you and will not be compensated
other than set forth above with respect to advisory functions undertaken by the Company. Accordingly, SMH,
and its representatives, are independent contractors and not agents or employees ofthe Company.
You hereby authorize the Company to: (i) provide SMH with information about your account; and (ii) provide
SMH with a duplicate copy of the investment agreement or subscription documentation entered into by you with
respect to a Company investment product or other investment account you may establish with the Company.
Please acknowledge your receipt ofthese additional disclosures and return by fax (with the original to follow) and
by regular mail your completed, signed and dated acknowledgement directly to Elliott M. Gartner at the address
below.
SMH Capital Inc.
c/o Ocotillo Capital, LLC
8700 E Vista Bonita, Ste 224, Scottsdale, AZ 85255
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Prospective Investor ~l,,L,,v~
afore Date
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Print Name
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