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<PAGE> PAGE 2
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012 C02AA01 MO
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013 A00AA01 ERNST & YOUNG LLP
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014 A00AA02 GRUNTAL SECURITIES, INC.
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<PAGE> PAGE 6
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<PAGE> PAGE 11
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SIGNATURE PHILIP J. COLLORA
TITLE SECRETARY
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<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE 1998
SEMIANNUAL REPORT TO SHAREHOLDERS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000055189
<NAME> ZURICH MONEY FUNDS
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<NET-CHANGE-FROM-OPS> 17,913
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (17,913)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 323,557
<NUMBER-OF-SHARES-REDEEMED> (331,804)
<SHARES-REINVESTED> 17,109
<NET-CHANGE-IN-ASSETS> 8,862
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 911
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 1,479
<AVERAGE-NET-ASSETS> 675,675
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> .03
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> (.03)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> .43
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE 1998
SEMIANNUAL REPORT TO SHAREHOLDERS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000055189
<NAME> ZURICH MONEY FUNDS
<SERIES>
<NUMBER> 03
<NAME> ZURICH TAX-FREE MONEY FUND
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JUL-31-1998
<PERIOD-START> AUG-01-1997
<PERIOD-END> JAN-31-1998
<INVESTMENTS-AT-COST> 800,311
<INVESTMENTS-AT-VALUE> 800,311
<RECEIVABLES> 5,381
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 805,692
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 1,145
<TOTAL-LIABILITIES> 1,145
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 804,547
<SHARES-COMMON-STOCK> 804,547
<SHARES-COMMON-PRIOR> 771,315
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 804,547
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 15,259
<OTHER-INCOME> 0
<EXPENSES-NET> (1,470)
<NET-INVESTMENT-INCOME> 13,789
<REALIZED-GAINS-CURRENT> 0
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 13,789
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (13,789)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 394,603
<NUMBER-OF-SHARES-REDEEMED> (374,621)
<SHARES-REINVESTED> 13,250
<NET-CHANGE-IN-ASSETS> 33,232
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,066
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 1,470
<AVERAGE-NET-ASSETS> 790,826
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> .02
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> (.02)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> .37
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
Exhibit 77C
Zurich Money Funds
Form N-SAR for the period ended 01/31/98
File No. 811-2527
Page 1
A special meeting of Registrant's shareholders was held on
December 3, 1997, and adjourned as necessary. Votes regarding
the items submitted to shareholder vote are set forth below.
Item 1: Election of the Board of Trustees
David W. Belin
Vote Number
---- -----------
FOR 2,900,450,890.435
WITHHELD 98,924,505.708
Lewis A. Burnham
Vote Number
---- -----------
FOR 2,907,619,621.562
WITHHELD 91,755,774.581
Donald L. Dunaway
Vote Number
---- -----------
FOR 2,906,529,035.652
WITHHELD 92,846,360.491
Robert B. Hoffman
Vote Number
---- -----------
FOR 2,908,284,683.015
WITHHELD 91,090,713.126
Exhibit 77C
Zurich Money Funds
Form N-SAR for the period ended 01/31/98
File No. 811-2527
Page 2
Donald R. Jones
Vote Number
---- -----------
FOR 2,905,582,054.035
WITHHELD 93,793,342.108
Shirley D. Peterson
Vote Number
---- -----------
FOR 2,899,187,418.805
WITHHELD 100,187,977.338
Daniel Pierce
Vote Number
---- -----------
FOR 2,899,232,088.165
WITHHELD 100,143,307.978
William P. Sommers
Vote Number
---- -----------
FOR 2,907,770,614.315
WITHHELD 91,604,781.828
Edmond D. Villani
Vote Number
---- -----------
FOR 2,898,500,982.338
WITHHELD 100,874,413.805
Exhibit 77C
Zurich Money Funds
Form N-SAR for the period ended 01/31/98
File No. 811-2527
Page 3
Item 2: Selection of Independent Auditors
Vote Number
---- -----------
FOR 2,880,124,795.324
AGAINST 54,846,164.538
ABSTAIN 64,404,436.281
Item 3: New Investment Management Agreement
Zurich Money Market Fund
Vote Number
---- -----------
FOR 2,087,746,039.219
AGAINST 88,885,448.751
ABSTAIN 82,379,756.319
Zurich Government Money Fund
Vote Number
---- -----------
FOR 306,353,948.032
AGAINST 13,731,194.205
ABSTAIN 11.584,654.844
Zurich Tax-Free Money Fund
Vote Number
---- -----------
FOR 371,055,197.714
AGAINST 18,501,115.399
ABSTAIN 18,188,457.660
Exhibit 77C
Zurich Money Funds
Form N-SAR for the period ended 01/31/98
File No. 811-2527
Page 4
Item 4: Approve of changes in investment policies
Zurich Money Market Fund
Vote Number
---- -----------
FOR 1,985,735,516.944
AGAINST 149,237,392.385
ABSTAIN 119,220,493.960
Zurich Government Money Fund
Vote Number
---- -----------
FOR 281,344,627.793
AGAINST 27,213,763.390
ABSTAIN 22,589,702.898
Zurich Tax-Free Money Fund
Vote Number
---- -----------
FOR 348,811,341.549
AGAINST 29,802,333.619
ABSTAIN 26,561,421.605
Item 6. Approve an amendment in the Agreement and Declaration of
Trust
Zurich Money Market Fund
Vote Number
---- -----------
FOR 1,999,434,835.787
AGAINST 131,225,194.194
ABSTAIN 123,533,373.308
Zurich Government Money Fund
Vote Number
---- -----------
FOR 286,592,345.807
AGAINST 20,425,280.515
ABSTAIN 24,160,467.759
Exhibit 77C
Zurich Money Funds
Form N-SAR for the period ended 01/31/98
File No. 811-2527
Page 5
Zurich Tax-Free Money Fund
Vote Number
---- -----------
FOR 349,916,525.504
AGAINST 26,643,848,749
ABSTAIN 28,614,722.520
Exhibit 77Q1(e)
Zurich Money Funds
Form N-SAR for the period ended 01/31/98
File No. 811-2527
INVESTMENT MANAGEMENT AGREEMENT
Zurich Money Funds
222 South Riverside Plaza
Chicago, Illinois 60606
December 31, 1997
Scudder Kemper Investments, Inc.
345 Park Avenue
New York, New York 10154
Investment Management Agreement
Zurich Money Market Fund
Zurich Government Money Fund
Zurich Tax-Free Money Fund
Ladies and Gentlemen:
ZURICH MONEY FUNDS (the "Trust") has been established as a
Massachusetts business trust to engage in the business of an
investment company. Pursuant to the Trust's Declaration of
Trust, as amended from time-to-time (the "Declaration"), the
Board of Trustees is authorized to issue the Trust s shares of
beneficial interest (the "Shares"), in separate series, or funds.
The Board of Trustees has authorized the Zurich Money Market
Fund, the Zurich Government Money Fund and the Zurich Tax-Free
Money Fund (each a "Fund" and collectively, the "Funds"). Series
may be abolished and dissolved, and additional series
established, from time to time by action of the Trustees.
The Trust, on behalf of the Funds, has selected you to act as the
investment manager of the Funds and to provide certain other
services, as more fully set forth below, and you have indicated
that you are willing to act as such investment manager and to
perform such services under the terms and conditions hereinafter
set forth. In the event the Trust establishes one or more
additional series with respect to which it desires to retain you
to render the services described hereunder, it shall notify you
in writing. If you are willing to render such services, you
shall notify the Trust in writing, whereupon such series shall
become a Fund hereunder. Accordingly, the Trust on behalf of the
Funds agrees with you as follows:
1. Delivery of Documents. The Trust engages in the business of
investing and reinvesting the assets of each Fund in the manner
and in accordance with the investment objectives, policies and
restrictions specified in the currently effective Prospectus (the
"Prospectus") and Statement of Additional Information (the "SAI")
relating to each Fund included in the Trust s Registration
Statement on Form N-1A, as amended from time to time, (the
"Registration Statement") filed by the Trust under the Investment
Company Act of 1940, as amended, (the "1940 Act") and the
Securities Act of 1933, as amended. Copies of the documents
referred to in the preceding sentence have been furnished to you
by the Trust. The Trust has also furnished you with copies
properly certified or authenticated of each of the following
additional documents related to the Trust and the Funds:
(a) The Declaration, as amended to date.
(b) By-Laws of the Trust as in effect on the date hereof
(the "By-Laws").
(c) Resolutions of the Trustees of the Trust and the
shareholders of each Fund selecting you as investment manager and
approving the form of this Agreement.
(d) Establishment and Designation of Series of Shares of
Beneficial Interest relating to the Funds, as applicable.
The Trust will furnish you from time to time with copies,
properly certified or authenticated, of all amendments of or
supplements, if any, to the foregoing, including the Prospectus,
the SAI and the Registration Statement.
2. Portfolio Management Services. As manager of the assets of
the Funds, you shall provide continuing investment management of
the assets of the Funds in accordance with the investment
objectives, policies and restrictions set forth in the Prospectus
and SAI; the applicable provisions of the 1940 Act and the
Internal Revenue Code of 1986, as amended, (the "Code") relating
to regulated investment companies and all rules and regulations
thereunder; and all other applicable federal and state laws and
regulations of which you have knowledge; subject always to
policies and instructions adopted by the Trust's Board of
Trustees. In connection therewith, you shall use reasonable
efforts to manage each Fund so that it will qualify as a
regulated investment company under Subchapter M of the Code and
regulations issued thereunder. The Funds shall have the benefit
of the investment analysis and research, the review of current
economic conditions and trends and the consideration of long-
range investment policy generally available to your investment
advisory clients. In managing the Funds in accordance with the
requirements set forth in this section 2, you shall be entitled
to receive and act upon advice of counsel to the Trust. You
shall also make available to the Trust promptly upon request all
of the Funds' investment records and ledgers as are necessary to
assist the Trust in complying with the requirements of the 1940
Act and other applicable laws. To the extent required by law,
you shall furnish to regulatory authorities having the requisite
2
authority any information or reports in connection with the
services provided pursuant to this Agreement which may be
requested in order to ascertain whether the operations of the
Trust are being conducted in a manner consistent with applicable
laws and regulations.
You shall determine the securities, instruments, investments,
currencies, repurchase agreements, futures, options and other
contracts relating to investments to be purchased, sold or
entered into by each Fund and place orders with broker-dealers,
foreign currency dealers, futures commission merchants or others
pursuant to your determinations and all in accordance with Fund
policies as expressed in the Registration Statement. You shall
determine what portion of each Fund's portfolio shall be invested
in securities and other assets and what portion, if any, should
be held uninvested.
You shall furnish to the Trust's Board of Trustees periodic
reports on the investment performance of each Fund and on the
performance of your obligations pursuant to this Agreement, and
you shall supply such additional reports and information as the
Trust's officers or Board of Trustees shall reasonably request.
3. Administrative Services. In addition to the portfolio
management services specified above in section 2, you shall
furnish at your expense for the use of the Funds such office
space and facilities in the United States as the Funds may
require for its reasonable needs, and you (or one or more of your
affiliates designated by you) shall render to the Trust
administrative services on behalf of the Funds necessary for
operating as an open end investment company and not provided by
persons not parties to this Agreement including, but not limited
to, preparing reports to and meeting materials for the Trust's
Board of Trustees and reports and notices to Fund shareholders;
supervising, negotiating contractual arrangements with, to the
extent appropriate, and monitoring the performance of, accounting
agents, custodians, depositories, transfer agents and pricing
agents, accountants, attorneys, printers, underwriters, brokers
and dealers, insurers and other persons in any capacity deemed to
be necessary or desirable to Fund operations; preparing and
making filings with the Securities and Exchange Commission (the
"SEC") and other regulatory and self-regulatory organizations,
including, but not limited to, preliminary and definitive proxy
materials, post-effective amendments to the Registration
Statement, semi-annual reports on Form N-SAR and notices pursuant
to Rule 24f-2 under the 1940 Act; overseeing the tabulation of
proxies by the Funds transfer agent; assisting in the
preparation and filing of each Fund s federal, state and local
tax returns; preparing and filing each Fund s federal excise tax
return pursuant to Section 4982 of the Code; providing assistance
with investor and public relations matters; monitoring the
valuation of portfolio securities and the calculation of net
3
asset value; monitoring the registration of Shares of each Fund
under applicable federal and state securities laws; maintaining
or causing to be maintained for the Funds all books, records and
reports and any other information required under the 1940 Act, to
the extent that such books, records and reports and other
information are not maintained by the Funds' custodian or other
agents of the Funds; assisting in establishing the accounting
policies of the Funds; assisting in the resolution of accounting
issues that may arise with respect to the Funds' operations and
consulting with the Funds' independent accountants, legal counsel
and the Funds' other agents as necessary in connection therewith;
establishing and monitoring each Fund s operating expense
budgets; reviewing each Fund's bills; processing the payment of
bills that have been approved by an authorized person; assisting
the Funds in determining the amount of dividends and
distributions available to be paid by each Fund to its
shareholders, preparing and arranging for the printing of
dividend notices to shareholders, and providing the transfer and
dividend paying agent, the custodian, and the accounting agent
with such information as is required for such parties to effect
the payment of dividends and distributions; and otherwise
assisting the Trust as it may reasonably request in the conduct
of the Funds' business, subject to the direction and control of
the Trust's Board of Trustees. Nothing in this Agreement shall
be deemed to shift to you or to diminish the obligations of any
agent of the Funds or any other person not a party to this
Agreement which is obligated to provide services to the Funds.
4. Allocation of Charges and Expenses. Except as otherwise
specifically provided in this section 4, you shall pay the
compensation and expenses of all Trustees, officers and executive
employees of the Trust (including each Fund's share of payroll
taxes) who are affiliated persons of you, and you shall make
available, without expense to the Funds, the services of such of
your directors, officers and employees as may duly be elected
officers of the Trust, subject to their individual consent to
serve and to any limitations imposed by law. You shall provide
at your expense the portfolio management services described in
section 2 hereof and the administrative services described in
section 3 hereof.
You shall not be required to pay any expenses of the Funds other
than those specifically allocated to you in this section 4. In
particular, but without limiting the generality of the foregoing,
you shall not be responsible, except to the extent of the
reasonable compensation of such of the Funds' Trustees and
officers as are directors, officers or employees of you whose
services may be involved, for the following expenses of each
Fund: organization expenses of each Fund (including out of-pocket
expenses, but not including your overhead or employee costs);
fees payable to you and to any other Fund advisors or
consultants; legal expenses; auditing and accounting expenses;
4
maintenance of books and records which are required to be
maintained by the Funds' custodian or other agents of the Trust;
telephone, telex, facsimile, postage and other communications
expenses; taxes and governmental fees; fees, dues and expenses
incurred by the Funds in connection with membership in investment
company trade organizations; fees and expenses of the Funds
accounting agent for which the Trust is responsible pursuant to
the terms of the Fund Accounting Services Agreement, custodians,
subcustodians, transfer agents, dividend disbursing agents and
registrars; payment for portfolio pricing or valuation services
to pricing agents, accountants, bankers and other specialists, if
any; expenses of preparing share certificates and, except as
provided below in this section 4, other expenses in connection
with the issuance, offering, distribution, sale, redemption or
repurchase of securities issued by each Fund; expenses relating
to investor and public relations; expenses and fees of
registering or qualifying Shares of each Fund for sale; interest
charges, bond premiums and other insurance expense; freight,
insurance and other charges in connection with the shipment of
each Fund's portfolio securities; the compensation and all
expenses (specifically including travel expenses relating to
Trust business) of Trustees, officers and employees of the Trust
who are not affiliated persons of you; brokerage commissions or
other costs of acquiring or disposing of any portfolio securities
of the Funds; expenses of printing and distributing reports,
notices and dividends to shareholders; expenses of printing and
mailing Prospectuses and SAIs of each Fund and supplements
thereto; costs of stationery; any litigation expenses;
indemnification of Trustees and officers of the Trust; and costs
of shareholders and other meetings.
You shall not be required to pay expenses of any activity which
is primarily intended to result in sales of Shares of a Fund if
and to the extent that (i) such expenses are required to be borne
by a principal underwriter which acts as the distributor of a
Fund s Shares pursuant to an underwriting agreement which
provides that the underwriter shall assume some or all of such
expenses, or (ii) the Trust on behalf of a Fund shall have
adopted a plan in conformity with Rule 12b-1 under the 1940 Act
providing that a Fund (or some other party) shall assume some or
all of such expenses. You shall be required to pay such of the
foregoing sales expenses as are not required to be paid by the
principal underwriter pursuant to the underwriting agreement or
are not permitted to be paid by a Fund (or some other party)
pursuant to such a plan.
5. Management Fee. For all services to be rendered, payments
to be made and costs to be assumed by you as provided in sections
2, 3, and 4 hereof, the Trust on behalf of the Funds shall pay
you in United States Dollars on the last day of each month the
unpaid balance of a fee equal to the excess of (a) 1/12 of .50 of
1 percent of the combined average daily net assets as defined
5
below of the Funds for such month; provided that, for any
calendar month during which the average of such values exceeds
$215,000,000, the fee payable for that month based on the portion
of the average of such values in excess of $215,000,000 shall be
1/12 of .375 of 1 percent of such portion; provided that, for any
calendar month during which the average of such values exceeds
550,000,000, the fee payable for that month based on the portion
of the average of such values in excess of $550,000,000 billion
shall be 1/12 of .30 of 1 percent of such portion; and provided
that, for any calendar month during which the average of such
values exceeds $800,000,000, the fee payable for that month based
on the portion of the average of such values in excess of
$800,000,000 shall be 1/12 of .25 of 1 percent of such portion;
over (b) the greater of (i) the amount by which the Funds'
aggregate expenses exceed on an annual basis 1.5% of the first
$30,000,000 of combined average daily net assets and 1% of
average daily net assets over $30,000,000 or (ii) any
compensation waived by you from time to time (as more fully
described below). You shall be entitled to receive during any
month such interim payments of your fee hereunder as you shall
request, provided that no such payment shall exceed 75 percent of
the amount of your fee then accrued on the books of the Funds and
unpaid.
The "average daily net assets" of a Fund shall mean the average
of the values placed on a Fund's net assets as of 4:00 p.m. (New
York time) on each day on which the net asset value of the Fund
is determined consistent with the provisions of Rule 22c-1 under
the 1940 Act or, if the Fund lawfully determines the value of its
net assets as of some other time on each business day, as of such
time. The value of the net assets of a Fund shall always be
determined pursuant to the applicable provisions of the
Declaration and the Registration Statement. If the determination
of net asset value does not take place for any particular day,
then for the purposes of this section 5, the value of the net
assets of such Fund as last determined shall be deemed to be the
value of its net assets as of 4:00 p.m. (New York time), or as of
such other time as the value of the net assets of the Fund's
portfolio may be lawfully determined on that day. If a Fund
determines the value of the net assets of its portfolio more than
once on any day, then the last such determination thereof on that
day shall be deemed to be the sole determination thereof on that
day for the purposes of this section 5.
You agree that your gross compensation for any fiscal year shall
not be greater than an amount which, when added to other expenses
of the Funds, shall cause the aggregate expenses of the Funds to
exceed on an annual basis 1.5% of the first $30,000,000 of
combined average daily net assets and 1% of average daily net
assets over $30,000,000. Except to the extent that such amount
has been reflected in reduced payments to you, you shall refund
to the Funds the amount of any payment received in excess of the
6
limitation pursuant to this section 5 as promptly as practicable
after the end of such fiscal year, provided that you shall not be
required to pay the Funds an amount greater than the fee paid to
you in respect of such year pursuant to this Agreement. As used
in this section 5, "expenses" shall mean those expenses included
in the applicable expense limitation having the broadest
specifications thereof, and "expense limitation" means a limit on
the maximum annual expenses which may be incurred by an
investment company determined (i) by multiplying a fixed
percentage by the average, or by multiplying more than one such
percentage by different specified amounts of the average, of the
values of an investment company's net assets for a fiscal year or
(ii) by multiplying a fixed percentage by an investment company's
net investment income for a fiscal year.
You may waive all or a portion of your fees provided for
hereunder and such waiver shall be treated as a reduction in
purchase price of your services. You shall be contractually
bound hereunder by the terms of any publicly announced waiver of
your fee, or any limitation of the Funds' expenses, as if such
waiver or limitation were fully set forth herein.
6. Avoidance of Inconsistent Position; Services Not Exclusive.
In connection with purchases or sales of portfolio securities and
other investments for the account of the Funds, neither you nor
any of your directors, officers or employees shall act as a
principal or agent or receive any commission. You or your agent
shall arrange for the placing of all orders for the purchase and
sale of portfolio securities and other investments for each
Fund'saccount with brokers or dealers selected by you in
accordance with Fund policies as expressed in the Registration
Statement. If any occasion should arise in which you give any
advice to clients of yours concerning the Shares of a Fund, you
shall act solely as investment counsel for such clients and not
in any way on behalf of such Fund.
Your services to the Funds pursuant to this Agreement are not to
be deemed to be exclusive and it is understood that you may
render investment advice, management and services to others. In
acting under this Agreement, you shall be an independent
contractor and not an agent of the Trust. Whenever a Fund and
one or more other accounts or investment companies advised by you
have available funds for investment, investments suitable and
appropriate for each shall be allocated in accordance with
procedures believed by you to be equitable to each entity.
Similarly, opportunities to sell securities shall be allocated in
a manner believed by you to be equitable. The Funds recognize
that in some cases this procedure may adversely affect the size
of the position that may be acquired or disposed of for the
Funds.
7
7. Limitation of Liability of Manager. As an inducement to
your undertaking to render services pursuant to this Agreement,
the Trust agrees that you shall not be liable under this
Agreement for any error of judgment or mistake of law or for any
loss suffered by a Fund in connection with the matters to which
this Agreement relates, provided that nothing in this Agreement
shall be deemed to protect or purport to protect you against any
liability to the Trust, the Funds or their shareholders to which
you would otherwise be subject by reason of willful misfeasance,
bad faith or gross negligence in the performance of your duties,
or by reason of your reckless disregard of your obligations and
duties hereunder.
8. Duration and Termination of This Agreement. This Agreement
shall remain in force until December 1, 1998, and continue in
force from year to year thereafter with respect to each Fund, but
only so long as such continuance is specifically approved for
each Fund at least annually (a) by the vote of a majority of the
Trustees who are not parties to this Agreement or interested
persons of any party to this Agreement, cast in person at a
meeting called for the purpose of voting on such approval, and
(b) by the Trustees of the Trust, or by the vote of a majority of
the outstanding voting securities of such Fund. The aforesaid
requirement that continuance of this Agreement be "specifically
approved at least annually" shall be construed in a manner
consistent with the 1940 Act and the rules and regulations
thereunder and any applicable SEC exemptive order therefrom.
This Agreement may be terminated with respect to a Fund at any
time, without the payment of any penalty, by the vote of a
majority of the outstanding voting securities of such Fund or by
the Trust's Board of Trustees on 60 days' written notice to you,
or by you on 60 days' written notice to the Trust. This
Agreement shall terminate automatically in the event of its
assignment.
This Agreement may be terminated with respect to a Fund at any
time without the payment of any penalty by the Board of Trustees
or by vote of a majority of the outstanding voting securities of
such Fund in the event that it shall have been established by a
court of competent jurisdiction that you or any of your officers
or directors has taken any action which results in a breach of
your covenants set forth herein.
9. Amendment of this Agreement. No provision of this Agreement
may be changed, waived, discharged or terminated orally, but only
by an instrument in writing signed by the party against whom
enforcement of the change, waiver, discharge or termination is
sought, and no amendment of this Agreement shall be effective
until approved in a manner consistent with the 1940 Act and rules
and regulations thereunder and any applicable SEC exemptive order
therefrom.
8
10. Limitation of Liability for Claims. The Declaration, a copy
of which, together with all amendments thereto, is on file in the
Office of the Secretary of the Commonwealth of Massachusetts,
provides that the name "Zurich Money Funds" refers to the
Trustees under the Declaration collectively as Trustees and not
as individuals or personally, and that no shareholder of a Fund,
or Trustee, officer, employee or agent of the Trust, shall be
subject to claims against or obligations of the Trust or of a
Fund to any extent whatsoever, but that the Trust estate only
shall be liable.
You are hereby expressly put on notice of the limitation of
liability as set forth in the Declaration and you agree that the
obligations assumed by the Trust on behalf of each Fund pursuant
to this Agreement shall be limited in all cases to each Fund and
its assets, and you shall not seek satisfaction of any such
obligation from the shareholders or any shareholder of a Fund or
any other series of the Trust, or from any Trustee, officer,
employee or agent of the Trust. You understand that the rights
and obligations of each Fund, or series, under the Declaration
are separate and distinct from those of any and all other series.
11. Miscellaneous. The captions in this Agreement are included
for convenience of reference only and in no way define or limit
any of the provisions hereof or otherwise affect their
construction or effect. This Agreement may be executed
simultaneously in two or more counterparts, each of which shall
be deemed an original, but all of which together shall constitute
one and the same instrument.
In interpreting the provisions of this Agreement, the definitions
contained in Section 2(a) of the 1940 Act (particularly the
definitions of "affiliated person," "assignment" and "majority of
the outstanding voting securities"), as from time to time
amended, shall be applied, subject, however, to such exemptions
as may be granted by the SEC by any rule, regulation or order.
This Agreement shall be construed in accordance with the laws of
the Commonwealth of Massachusetts, provided that nothing herein
shall be construed in a manner inconsistent with the 1940 Act, or
in a manner which would cause a Fund to fail to comply with the
requirements of Subchapter M of the Code.
This Agreement shall supersede all prior investment advisory or
management agreements entered into between you and the Trust on
behalf of the Funds.
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If you are in agreement with the foregoing, please execute the
form of acceptance on the accompanying counterpart of this letter
and return such counterpart to the Trust, whereupon this letter
shall become a binding contract effective as of the date of this
Agreement.
Yours very truly,
ZURICH MONEY FUNDS, on behalf of
Zurich Money Market Fund
Zurich Government Money Fund
Zurich Tax-Free Money Fund
By: /s/ John E. Neal
-----------------------------
Vice President
The foregoing Agreement is hereby accepted as of the date hereof.
SCUDDER KEMPER INVESTMENTS, INC.
By: /s/ Lynn S. Birdsong
-----------------------------
Vice President
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