INVESTMENT ADVISORY AGREEMENT
THIS AGREEMENT, entered into as of November 10, 2003, by and between the
GOVERNMENT STREET MID-CAP FUND of WILLIAMSBURG INVESTMENT TRUST, a Massachusetts
Business Trust (the "Trust"), and X. Xxxxxxx & Associates, Inc., an Alabama
corporation (the "Adviser"), registered as an investment adviser under the
Investment Advisers Act of 1940, as amended (the "Advisers Act").
WHEREAS, the Trust is registered as a no-load, diversified, open-end
management investment company of the series type under the Investment Company
Act of 1940, as amended (the "1940 Act"); and
WHEREAS, the Trust desires to retain the Adviser to furnish investment
advisory and administrative services to The Government Street Mid-Cap Fund
series of the Trust, and the Adviser is willing to so furnish such services;
NOW THEREFORE, in consideration of the promises and mutual covenants herein
contained, it is agreed between the parties hereto as follows:
1. APPOINTMENT. The Trust hereby appoints the Adviser to act as
investment adviser to The Government Street Mid-Cap Fund series of the
Trust (the "Fund") for the period and on the terms set forth in this
Agreement. The Adviser accepts such appointment and agrees to furnish
the services herein set forth, for the compensation herein provided.
2. DELIVERY OF DOCUMENTS. The Trust has furnished the Investment Adviser
with copies properly certified or authenticated of each of the
following:
(a) The Trust's Declaration of Trust, as filed with the State of
Massachusetts (such Declaration, as presently in effect and as it
shall from time to time be amended, is herein called the
"Declaration");
(b) The Trust's By-Laws (such By-Laws, as presently in effect and as
they shall from time to time be amended, are herein called the
"By-Laws");
(c) Resolutions of the Trust's Board of Trustees authorizing
Agreement;
(d) The Trust's Registration Statement on Form N-1A under the 1940
Act and under the Securities Act of 1933 as amended (the "1933
Act"), relating to shares of beneficial interest of the Trust
(herein called the "Shares") as filed with the Securities and
Exchange Commission ("SEC") and all amendments thereto;
(e) The Trust's Prospectus (such Prospectus, as presently in effect
and all amendments and supplements thereto are herein called the
"Prospectus").
The Trust will furnish the Adviser from time to time with copies,
properly certified or authenticated, of all amendments of or
supplements to the foregoing at the same time as such documents are
required to be filed with the SEC.
3. MANAGEMENT. 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, investments, cash 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
objectives, policies and restrictions as stated in its Prospectus. The
Adviser further agrees that it:
(a) Will conform its activities to all applicable Rules and Regulations of
the Securities and Exchange Commission and will, in addition, conduct
its activities under this Agreement in accordance with regulations of
any other Federal and State agencies which may now or in the future
have jurisdiction over its activities under this Agreement;
(b) 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 or 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 Adviser believes two
or more brokers or dealers are comparable in price and execution, the
Adviser may prefer: (i) brokers and dealers who provide the Fund with
research advice and other services, or who recommend or sell Fund
shares, and (ii) Brokers who are affiliated with the Trust or its
Adviser(s), provided, however, that in no instance will portfolio
securities be purchased from or sold to the Adviser or any affiliated
person of the Adviser in principal transactions;
(c) Will provide certain executive personnel for the Trust as may be
mutually agreed upon from time to time with the Board of Trustees, the
salaries and expenses of such personnel to be borne by the Adviser
unless otherwise mutually agreed upon; and
(d) Will provide, at its own cost, all office space, facilities and
equipment necessary for the conduct of its advisory activities on
behalf of the Trust.
Notwithstanding the foregoing, the Adviser may obtain the services of an
investment counselor or sub-advisor of its choice subject to the approval
of the Board of Trustees. The cost of employing such counselor or
sub-advisor will be paid by the Adviser and not by the Trust.
4. SERVICES NOT EXCLUSIVE. The advisory services furnished by the Adviser
hereunder are not to be deemed exclusive, and the Adviser shall be free to
furnish similar services to others as long as its services under this
Agreement are not impaired thereby provided, however, the without the
written consent of the Trustees, the Adviser will not serve as investment
adviser to any other investment company having a similar investment
objective to that of the Fund.
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
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benefit of 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 it pursuant to Rule 31a-2 under the 1940 Act the records required to be
maintained by Rule 31a-1 under the Act that are not maintained by others on
behalf of the Trust.
6. EXPENSES. During the term of this Agreement, the Adviser will pay all
expenses incurred by it in connection with its investment advisory services
pertaining to the Trust. In the event that there is no distribution plan
under Rule 12b-1 of the 1940 Act in effect for the Fund, the Adviser will
pay, out of the Adviser's resources generated from sources other than fees
received from the Trust, the entire cost of the promotion and sale of Fund
shares.
Notwithstanding the foregoing, the Trust shall pay the expenses and costs
of the following:
(a) Taxes, interest charges, and extraordinary expenses;
(b) Brokerage fees and commissions with regard to portfolio transactions
of the Fund;
(c) Fees and expenses of the custodian of the Fund's portfolio securities;
(d) Fees and expenses of the Fund's administrative agent, the Fund's
transfer and shareholder servicing agent and the Fund's accounting
agent or, if the Trust performs any such services without an agent,
the costs of the same;
(e) Auditing and legal expenses;
(f) Cost of maintenance of the Trust's existence as a legal entity;
(g) Compensation of trustees who are not interested persons of the Adviser
as that term is defined by law;
(h) Costs of Trust meetings;
(i) Federal and State registration or qualification fees and expenses;
(j) Costs of setting in type, printing and mailing Prospectuses, reports
and notices to existing shareholders;
(k) The investment advisory fee payable to the Adviser, as provided in
paragraph 7 herein; and
(l) Distribution expenses, but only in accordance with any Distribution
Plan as and if approved by the shareholders of the Fund.
It is understood that the Trust may desire to register the Fund's
shares for sale in certain states which impose expense limitations on
mutual funds. The Trust agrees that it will register the Fund's shares
in such states only with the prior written consent of the Adviser. It
is further understood that the Trustees desire to limit Fund expenses
to 2% of average daily net assets, if such state limitations are not so
restrictive. The Adviser agrees to reimburse the Trust an amount equal
to any excess expenses incurred over the lesser of either (i) the most
stringent of such states' limitations in which the Fund's shares are
registered, or (ii) 2% of average daily net assets. The Adviser shall
in no event be required to reimburse
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an amount greater than its fees received from the Trust pursuant to
paragraph 7, below.
7. COMPENSATION. For the services provided to the Fund and for the expenses
assumed by the Adviser pursuant to this Agreement, the Trust will pay the
Adviser and the Adviser will accept as full compensation an investment
advisory fee, computed at the end of each month and payable within five (5)
business days thereafter, at the annual rate of 0.75% of the Fund's average
daily net assets.
8.(a)LIMITATION OF LIABILITY. The Adviser shall not be liable for any error of
judgment, mistake of law or for any other loss whatsoever 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
the 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.
8.(b)INDEMNIFICATION OF ADVISER. Subject to the limitations set forth in this
Subsection 8(b), the Trust shall indemnify, defend and hold harmless (from
the assets of the Fund or Funds to which the conduct in question relates)
the Adviser against all loss, damage and liability, including but not
limited to amounts paid in satisfaction of judgments, in compromise or as
fines and penalties, and expenses, including reasonable accountants' and
counsel fees, incurred by the Adviser in connection with the defense or
disposition of any action, suit or other proceeding, whether civil or
criminal, before any court or administrative or legislative body, related
to or resulting from this Agreement or the performance of services
hereunder, except with respect to any matter as to which it has been
determined that the loss, damage or liability is a direct result of (i) a
breach of fiduciary duty with respect to the receipt of compensation for
services; or (ii) 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 duties under this Agreement (either and both of the
conduct described in clauses (i) and (ii) above being referred to
hereinafter as "DISABLING CONDUCT"). A determination that the Adviser is
entitled to indemnification may be made by (i) a final decision on the
merits by a court or other body before whom the proceeding was brought that
the Adviser was not liable by reason of Disabling Conduct, (ii) dismissal
of a court action or an administrative proceeding against the Adviser for
insufficiency of evidence of Disabling Conduct, or (iii) a reasonable
determination, based upon a review of the facts, that the Adviser was not
liable by reason of Disabling Conduct by, (a) vote of a majority of a
quorum of Trustees who are neither "interested persons" of the Trust as the
quoted phrase is defined in Section 2(a)(19) of the 1940 Act nor parties to
the action, suit or other proceeding on the same or similar grounds that is
then or has been pending or threatened (such quorum of such Trustees being
referred to hereinafter as the "INDEPENDENT TRUSTEES"), or (b) an
independent legal counsel in a written opinion. Expenses, including
accountants' and counsel fees so incurred by the Adviser (but excluding
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amounts paid in satisfaction of judgments, in compromise or as fines or
penalties), may be paid from time to time in advance of the final
disposition of any such action, suit or proceeding; provided, that the
Adviser shall have undertaken to repay the amounts so paid if it is
ultimately determined that indemnification of such expenses is not
authorized under this Subsection 8(b) and if (i) the Adviser shall have
provided security for such undertaking, (ii) the Trust shall be insured
against losses arising by reason of any lawful advances, or (iii) a
majority of the Independent Trustees, or an independent legal counsel in a
written opinion, shall have determined, based on a review of readily
available facts (as opposed to a full trial-type inquiry), that there is
reason to believe that the Adviser ultimately will be entitled to
indemnification hereunder.
As to any matter disposed of by a compromise payment by the Adviser
referred to in this Subsection 8(b), pursuant to a consent decree or
otherwise, no such indemnification either for said payment or for any other
expenses shall be provided unless such indemnification shall be approved
(i) by a majority of the Independent Trustees or (ii) by an independent
legal counsel in a written opinion. Approval by the Independent counsel in
a written opinion. Approval by the Independent Trustees pursuant to clause
(i) shall not prevent the recovery from the Adviser of any amount paid to
the Adviser in accordance with either of such clauses as indemnification of
the Adviser is subsequently adjudicated by a court of competent
jurisdiction not to have acted in good faith in the reasonable belief that
the Adviser's action was in or not opposed to the best interests of the
Trust or to have been liable to the Trust or its Shareholders by reason of
willful misfeasance, bad faith, gross negligence or reckless disregard of
the duties involved in its conduct under the Agreement.
The right of indemnification provided by this Subsection 8(b) shall not be
exclusive of or affect any of the rights to which the Adviser may be
entitled. Nothing contained in this Subsection 8(b) shall affect any rights
to indemnification to which Trustees, officers or other personnel to which
Trustees, officers or other personnel of the Trust, and other persons may
be entitled by contract or otherwise under law, nor the power of the Trust
to purchase and maintain liability insurance on behalf of any such person.
The Board of Trustees of the Trust shall take all such action as may be
necessary and appropriate to authorize the Trust hereunder to pay the
indemnification required by this Subsection 8(b) including, without
limitation, to the extent needed, to determine whether the Adviser is
entitled to indemnification hereunder and the reasonable amount of any
indemnity due it hereunder, or employ independent legal counsel for that
purpose.
8.(c)The provisions contained in Section 8 shall survive the expiration or
other termination of this Agreement, shall be deemed to include and protect
the Adviser and its directors, officers, employees and agents and shall
inure to the benefit of its/their respective successors, assigns and
personal representatives.
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9. DURATION AND TERMINATION. This Agreement shall become effective on the date
of its execution and, unless sooner terminated as provided herein, shall
continue in effect until April 1, 2005. Thereafter, this Agreement shall be
renewable for successive periods of one year each, provided such
continuance is specifically approved annually:
(a) By the vote of a majority of those members of the Board of Trustees
who are not parties to this Agreement or interested persons of any
such party (as that term is defined in the 1940 Act), cast in person
at a meeting called for the purpose of voting on such approval; and
(b) By vote of either the Board or a majority (as that term is defined in
the 0000 Xxx) of the outstanding voting securities of the Fund.
Notwithstanding the foregoing, this Agreement may be terminated by the Fund
or by the Adviser at any time on sixty (60) days' written notice, without
the payment of any penalty, provided that termination by the Fund must be
authorized either by vote of the Board of the Board of Trustees or by vote
of a majority of the outstanding voting securities of the Fund. This
Agreement will automatically terminate in the event of its assignment (as
that term is defined 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 a written instrument
signed by the party against which enforcement of the change, waiver,
discharge or termination is sought. No material amendment of this Agreement
shall be effective until approved by vote of the holders of a majority of
the Fund's outstanding voting securities (as defined in the 1940 Act).
11. MISCELLANEOUS. The captions of 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. If any provision
of this Agreement shall be held or made invalid by a court decision,
statute, rule or otherwise, the remainder of the Agreement shall not be
affected thereby. This Agreement shall be binding and shall inure to the
benefit of the parties hereto and their respective successors.
12. APPLICABLE LAW. This Agreement shall be construed in accordance with, and
governed by, the laws of the State of North Carolina.
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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.
ATTEST: WILLIAMSBURG INVESTMENT TRUST
By: ____________________ By: ______________________________
Title: _________________ Title: ___________________________
ATTEST: X. XXXXXXX & ASSOCIATES, INC.
By: ____________________ By: ______________________________
Title: _________________ Title: ___________________________
