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EXHIBIT 5(i)
FORM
ARMADA FUNDS
CORE EQUITY FUND
ADVISORY AGREEMENT
AGREEMENT made as of , 1996 between ARMADA FUNDS, a
Massachusetts business trust, located in Westborough, Massachusetts (the
"Trust") and NATIONAL ASSET MANAGEMENT CORPORATION, located in Louisville,
Kentucky (the "Adviser").
WHEREAS, the Trust is registered as an open-end, management investment
company under the Investment Company Act of 1940, as amended ("1940 Act"); and
WHEREAS, the Trust desires to retain the Adviser as investment adviser
to the Core Equity Fund (the "Fund");
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, it is agreed among the parties hereto as follows:
1. DELIVERY OF DOCUMENTS. The Adviser acknowledges that it has received
copies of each of the following:
(a) The Trust's Declaration of Trust, as filed with the
State Secretary of the Commonwealth of Massachusetts
on January 29, 1986, and all amendments thereto (such
Declaration of Trust, as presently in effect and as
it shall from time to time be amended, is herein
called the "Declaration of Trust");
(b) The Trust's Code of Regulations and amendments
thereto (such Code of Regulations, as presently in
effect and as it shall from time to time be amended,
is herein called the "Code of Regulations");
(c) Resolutions of the Trust's Board of Trustees
authorizing the appointment of the Adviser and
approving this Agreement;
(d) The Trust's Notification of Registration on Form N-8A
under the 1940 Act as filed with the Securities and
Exchange Commission ("SEC") on September 26, 1985 and
all amendments thereto;
(e) The Trust's Registration Statement on Form N-1A
under the Securities Act of 1933, as amended
("1933 Act") (File No. 33-488) and under the 1940
Act, as filed with the SEC on September 26, 1985
and all amendments thereto; and
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(f) The Trust's most recent prospectuses and statements
of additional information with respect to the Fund
(such prospectuses and statements of additional
information, as presently in effect, and all
amendments and supplements thereto, are herein called
individually, a "Prospectus", and collectively, the
"Prospectuses").
The Trust will furnish the Adviser from time to time with
execution copies of all amendments of or supplements to the foregoing.
2. SERVICES. The Trust hereby appoints the Adviser to act as investment
adviser to the Fund for the period and on the terms set forth in this
Agreement. Intending to be legally bound, the Adviser accepts such
appointment and agrees to furnish the services required herein to the
Fund for the compensation hereinafter provided.
Subject to the supervision of the Trust's Board of Trustees,
the Adviser will provide a continuous investment program for the Fund,
including investment research and management with respect to all
securities and investments and cash equivalents in the Fund. The
Adviser will determine from time to time what securities and other
investments will be purchased, retained or sold by the Fund. The
Adviser will provide the services under this Agreement in accordance
with the Fund's investment objective, policies, and restrictions as
stated in the Prospectus and resolutions of the Trust's Board of
Trustees applicable to the Fund.
3. COVENANTS BY ADVISER. The Adviser agrees with respect
to the services provided to the Fund that it:
(a) will comply with all applicable Rules and Regulations
of the SEC and will in addition conduct its
activities under this Agreement in accordance with
other applicable law;
(b) will use the same skill and care in providing such
services as it uses in providing services to
similar fiduciary accounts for which it has
investment responsibilities;
(c) will not make loans to any person to purchase or
carry shares in the Fund, or make interest-bearing
loans to the Trust or the Fund;
(d) will maintain a policy and practice of conducting
its investment management activities independently
of the Commercial Departments of all banking
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affiliates. In making investment recommendations
for the Fund, personnel will not inquire or take
into consideration whether the issuers (or related
supporting institutions) of securities proposed
for purchase or sale for the Fund's accounts are
customers of the Commercial Department. In
dealing with commercial customers, the Commercial
Department will not inquire or take into
consideration whether securities of those
customers are held by the Fund;
(e) will place orders pursuant to its investment
determinations for the Fund either directly with
the issuer or with any broker or dealer. In
placing orders with brokers and dealers the
Adviser will attempt to obtain the best net price
and the most favorable execution of its orders.
Consistent with this obligation, when the
execution and price offered by two or more brokers
or dealers are comparable, the Adviser may, in its
discretion, purchase and sell fund securities from
and to brokers and dealers who provide the Trust
with research advice and other services. In no
instance will fund securities be purchased from or
sold to the Adviser, 440 Financial Distributors,
Inc. ("440 Financial") or an affiliated person of
either the Trust, the Adviser, or 440 Financial
unless permitted by an order of the SEC or
applicable rules;
(f) will maintain all books and records with respect to
the securities transactions for the Fund and furnish
the Trust's Board of Trustees such periodic and
special reports as the Board may request; and
(g) will treat confidentially and as proprietary
information of the Trust all records and other
information relative to the Fund and prior,
present or potential shareholders, and will not
use such records and information for any purpose
other than performance of its responsibilities and
duties hereunder (except after prior notification
to and approval in writing by the Trust, which
approval shall not be unreasonably withheld and
may not be withheld and will be deemed granted
where the Adviser may be exposed to civil or
criminal contempt proceedings for failure to
comply, when requested to divulge such information
by duly constituted authorities, or when so
requested by the Trust).
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4. SERVICES NOT EXCLUSIVE. The services furnished by the Adviser
hereunder are deemed not to be exclusive, and the Adviser shall be free
to furnish similar services to others so long as its services under
this Agreement are not impaired thereby.
5. BOOKS AND RECORDS. In compliance with the requirements of Rule 31a-3
under the 1940 Act, the Adviser hereby agrees that all records which it
maintains for the Trust are the property of the Trust and further
agrees to surrender promptly to the Trust any of such records upon the
Trust's request. The Adviser further agrees to preserve for the periods
prescribed by Rule 31a-2 under the 1940 Act the records required to be
maintained by Rule 31a-1 under the 1940 Act.
6. EXPENSES. During the term of this Agreement, the Adviser will pay
all expenses incurred by it in connection with its activities under
this Agreement other than the cost of securities (including brokerage
commissions, if any) purchased for the Fund.
7. COMPENSATION. For the services provided and the expenses assumed
pursuant to this Agreement, the Trust will pay the Adviser from the
assets belonging to the Fund and the Adviser will accept as full
compensation therefor fees, computed daily and paid monthly, at the
following annual rate of % of the average daily net assets of the
Fund.
If in any fiscal year the aggregate expenses of the Fund (as
defined under the securities regulations of any state having
jurisdiction over the Fund) exceed the expense limitations of any such
state, the Adviser will reimburse the Trust for such excess expenses to
the extent described in any written undertaking provided by the Adviser
to such state.
8. LIMITATION OF LIABILITY. The Adviser shall not be liable for any
error of judgment or mistake of law or for any loss suffered by the
Trust in connection with the performance of this Agreement, except a
loss resulting from a breach of fiduciary duty with respect to the
receipt of compensation for services or a loss resulting from willful
misfeasance, bad faith or gross negligence on the part of the Adviser
in the performance of its duties or from reckless disregard by it of
its obligations and duties under this Agreement.
9. DURATION AND TERMINATION. This Agreement will become effective with
respect to the Fund upon approval of this Agreement by vote of a
majority of the outstanding voting securities of the Fund, and, unless
sooner terminated as
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provided herein, shall continue in effect until September 30, 1997.
Thereafter, if not terminated, this Agreement shall continue in effect
with respect to a particular Fund for successive twelve month periods
ending on September 30, PROVIDED such continuance is specifically
approved at least annually (a) by the vote of a majority of those
members of the Trust's Board of Trustees who are not 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 Trust's Board of
Trustees or by vote of a majority of the outstanding voting securities
of the Fund. Notwithstanding the foregoing, this Agreement may be
terminated at any time, without the payment of any penalty, by the
Trust (by the Trust's Board of Trustees or by vote of a majority of the
outstanding voting securities of the Fund), or by the Adviser on 60
days' written notice. This Agreement will immediately terminate in the
event of its assignment. (As used in this Agreement, the terms
"majority of the outstanding voting securities," "interested persons"
and "assignment" shall have the same meaning of such terms in the 1940
Act.)
10. 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 which enforcement of
the change, waiver, discharge or termination is sought. No amendment of
this Agreement shall be effective with respect to the Fund until
approved by vote of a majority of the outstanding voting securities of
the Fund.
11. MISCELLANEOUS. The Adviser expressly agrees that notwithstanding
the termination of or failure to continue this Agreement with respect
to the Fund, the Adviser shall continue to be legally bound to provide
the services required herein for the period and on the terms set forth
in this Agreement. The captions in this Agreement are included for
convenience of reference only and in no way define or delimit any of
the provisions hereof or otherwise affect their construction or effect.
If any provision of this Agreement shall be held or made invalid by a
court decision, statute, rule or otherwise, the remainder of this
Agreement shall not be affected thereby. This Agreement shall be
binding upon and shall inure to the benefit of the parties hereto and
their respective successors and shall be governed by Delaware law.
12. NAMES. The names "ARMADA FUNDS" and "Trustees of ARMADA FUNDS"
refer respectively to the Trust created and the Trustees, as trustees
but not individually or personally, acting from time to time under a
Declaration of Trust dated January 28, 1986 which is hereby referred to
and
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a copy of which is on file at the office of the State Secretary of the
Commonwealth of Massachusetts and the principal office of the Trust.
The obligations of "ARMADA FUNDS" entered into in the name or on behalf
thereof by any of the Trustees, representatives or agents are made not
individually, but in such capacities, and are not binding upon any of
the Trustees, shareholders, or representatives of the Trust personally,
but bind only the Trust property, and all persons dealing with any
class of shares of the Trust must look solely to the Trust property
belonging to such class for the enforcement of any claims against the
Trust.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be executed by their officers designated below as of the day and year first
above written.
ARMADA FUNDS
By:____________________________
Title:
NATIONAL ASSET MANAGEMENT
CORPORATION
By:____________________________
Title:
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