Exhibit 10.15
INVESTMENT MANAGEMENT
AGREEMENT
This Agreement,
originally made the 1st day of July, 1990, by and between W&R
TARGET FUNDS, INC., f.k.a. TMK/United Funds, Inc.,
(hereinafter called “Corporation”) and
Waddell & Reed, Inc. (“W&R”), and
assigned to WADDELL & REED INVESTMENT MANAGEMENT COMPANY
(“WRIMCO”) on January 8, 1992, and amended and
restated as of August 21, 2002, has been approved, annually,
by the Board of Directors, including separate approval by the
Disinterested Directors, as prescribed by
Section 15(c) of the Investment Company Act of 1940, as
amended (“1940 Act”), and is hereby further amended and
effective November 9, 2005.
WITNESSETH:
In consideration of the
mutual promises and agreements herein contained and other good and
valuable consideration, the receipt of which is hereby
acknowledged, it is hereby agreed by and between the parties hereto
as follows:
I. In
General
WRIMCO agrees to
act as investment adviser to the Corporation with respect to the
investment of its assets and in general to supervise the
investments of the Corporation with regard to each of its series
listed in Exhibit A, the Fee Schedule, subject at all times to
the direction and control of the Board of Directors of the
Corporation, all as more fully set forth herein.
II. Duties of WRIMCO with respect to
investment of assets of the Corporation
A. WRIMCO
shall regularly provide investment advice to the Corporation and
shall, subject to the succeeding provisions of this section,
continuously supervise the investment and reinvestment of cash,
securities or other property comprising the assets of the
investment portfolio of the Corporation; and in furtherance
thereof, WRIMCO shall:
1. obtain
and evaluate pertinent information about significant developments
and economic, statistical and financial data, domestic, foreign or
otherwise, whether affecting the economy generally or the portfolio
of the Corporation, and whether concerning the individual companies
whose securities are included in the Corporation’s portfolio
or the industries in which they engage, or with respect to
securities which WRIMCO considers desirable for inclusion in the
Corporation’s portfolio;
2. furnish
continuously an investment program for the portfolio of the
Corporation;
3. determine
what securities shall be purchased or sold by the
Corporation;
4. take, on
behalf of the Corporation, all actions which appear to WRIMCO
necessary to carry into effect such investment programs and
supervisory functions as aforesaid, including the placing of
purchase and sale orders.
B. WRIMCO
shall make appropriate and regular reports to the Board of
Directors of the Corporation on the actions it takes pursuant to
Section II.A. above. Any investment programs furnished
by WRIMCO under this section, or any supervisory function taken
hereunder by WRIMCO shall at all times conform to and be in
accordance with any requirements imposed by:
1. the
provisions of the 1940 Act and any rules or regulations in
force thereunder;
2. any other
applicable provision of law;
3. the
provisions of the Articles of Incorporation of the Corporation as
amended from time to time;
4. the
provisions of the Bylaws of the Corporation as amended from time to
time;
5. the terms
of the registration statement of the Corporation, as amended from
time to time, under the Securities Act of 1933 and the 1940
Act.
C. Any
investment programs furnished by WRIMCO under this section or any
supervisory functions taken hereunder by WRIMCO shall at all times
be subject to any directions of the Board of Directors of the
Corporation, its Executive Committee, or any committee or officer
of the Corporation acting pursuant to authority given by the Board
of Directors.
III.
Allocation of Expenses
The expenses of
the Corporation and the expenses of WRIMCO in performing its
functions under this Agreement shall be divided into two classes,
to wit: (i) those expenses which will be paid in full by
WRIMCO as set forth in subparagraph “A” hereof, and
(ii) those expenses which will be paid in full by the
Corporation, as set forth in subparagraph “B”
hereof.
A. With
respect to the duties of WRIMCO under Section II above, it
shall pay in full, except as to the brokerage and research services
acquired through the allocation of commissions as provided in
Section IV hereinafter, for (a) the salaries and
employment benefits of all employees of WRIMCO who are engaged in
providing these advisory services; (b) adequate office space
and suitable office equipment for such employees; and (c) all
telephone and communications costs relating to such
functions. In addition, WRIMCO shall pay the fees and
expenses of all directors of the Corporation who are employees of
WRIMCO or an affiliated corporation and the salaries and employment
benefits of all officers of the Corporation who are affiliated
persons of WRIMCO.
B. The
Corporation shall pay in full for all of its expenses which are not
listed above (other than those assumed by W&R or its affiliates
in their respective capacities as principal
2
underwriter of the
shares of the Corporation, as Shareholder Servicing Agent or as
Accounting Services Agent for the Corporation), including
(a) the costs of preparing and printing prospectuses and
reports to shareholders of the Corporation including mailing costs;
(b) the costs of printing all proxy statements and all other
costs and expenses of meetings of shareholders of the Corporation
(unless the Corporation and WRIMCO shall otherwise agree);
(c) interest, taxes, brokerage commission and premiums on
fidelity and other insurance; (d) audit fees and expenses of
independent accountants and legal fees and expenses of attorneys,
but not of attorneys who are employees of WRIMCO or an affiliated
company; (e) fees and expenses of its directors not affiliated
with WRIMCO or its affiliates; (f) custodian fees and
expenses; (g) fees payable by the Corporation under the
Securities Act of 1933, the 1940 Act, and the securities or
“Blue-Sky” laws of any jurisdiction; (h) fees and
assessments of the Investment Company Institute or any successor
organization; (i) such non recurring or extraordinary expenses
as may arise, including litigation affecting the Corporation and
any indemnification by the Corporation of its officers, directors,
employees and agents with respect thereto; (j) the costs and
expenses provided for in any Shareholder Servicing Agreement or
Accounting Services Agreement, including amendments thereto,
contemplated by subsection C of this Section III. In the
event that any of the foregoing shall, in the first instance, be
paid by WRIMCO, the Corporation shall pay the same to WRIMCO on
presentation of a statement with respect thereto.
C. WRIMCO,
or an affiliate of WRIMCO, may also act as (i) transfer agent
or shareholder servicing agent of the Corporation and/or as
(ii) accounting services agent of the Corporation if at the
time in question there is a separate agreement, “Shareholder
Servicing Agreement” and/or “Accounting Services
Agreement,” covering such functions between the Corporation
and WRIMCO or such affiliate. The corporation, whether WRIMCO
or its affiliate, which is the party to such Agreement with the
Corporation is referred to as the “Agent.” Each
such Agreement shall provide in substance that it shall not go into
effect, or be amended, or a new agreement covering the same topics
between the Corporation and the Agent be entered into unless the
terms of such Agreement, such amendment or such new agreement have
been approved by the Board of Directors of the Corporation,
including the vote of a majority of the directors who are not
“interested persons” as defined in the 1940 Act, of
either party to the Agreement, such amendment or such new agreement
(considering WRIMCO to be such a party even if at the time in
question the Agent is an affiliate of WRIMCO), cast in person at a
meeting called for the purpose of voting on such approval.
Such a vote is referred to as a “disinterested
director” vote. Each such Agreement shall also provide
in substance for its continuance, unless terminated, for a
specified period which shall not exceed two years from the date of
its execution and from year to year thereafter only if such
continuance is speci
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