FRONTEGRA FUNDS, INC.
INVESTMENT ADVISORY AGREEMENT
THIS AGREEMENT is entered into as of the ____ day
of _________, 1996, between Frontegra Funds, Inc., a
Maryland corporation (the "Corporation"), and Frontegra
Asset Management, Inc., an Illinois corporation
("Frontegra").
W I T N E S S E T H
WHEREAS, the Corporation is an open-end investment
company registered under the Investment Company Act of
1940, as amended (the "Act"). The Corporation is
authorized to create separate series, each with its own
separate investment portfolio (the "Funds"), and the
beneficial interest in each such series will be
represented by a separate series of shares (the
"Shares").
WHEREAS, Frontegra is a registered investment
adviser, engaged in the business of rendering
investment advisory services.
WHEREAS, in managing the Corporation's assets, as
well as in the conduct of certain of its affairs, the
Corporation seeks the benefit of Frontegra's services
and its assistance in performing certain managerial
functions. Frontegra desires to furnish such services
and to perform the functions assigned to it under this
Agreement for the consideration provided for herein.
NOW THEREFORE, the parties mutually agree as
follows:
1. Appointment. The Corporation hereby appoints
Frontegra as investment adviser for each of the Funds
of the Corporation on whose behalf the Corporation
executes an Exhibit to this Agreement, and Frontegra,
by execution of each such Exhibit, accepts the
appointments. Subject to the direction of the Board of
Directors (the "Directors") of the Corporation,
Frontegra shall manage the investment and reinvestment
of the assets of each Fund in accordance with the
Fund's investment objective and policies and
limitations, for the period and upon the terms herein
set forth. The investment of funds shall also be
subject to all applicable restrictions of the Articles
of Incorporation and Bylaws of the Corporation as may
from time to time be in force. Frontegra is hereby
authorized to delegate its duties hereunder to a
subadviser pursuant to a written agreement under which
the subadviser shall furnish the services specified
therein to Frontegra. Frontegra will continue to have
responsibility for all investment advisory services
furnished pursuant to any agreement with a subadviser.
2. Management Functions. In addition to the
expenses which Frontegra may incur in the performance
of its responsibilities under this Agreement, and the
expenses which it may expressly undertake to incur and
pay, Frontegra shall incur and pay the following
expenses:
(a) Reasonable compensation, fees and
related expenses of the Corporation's officers and its
Directors, except for such Directors who are not
interested persons (as that term is defined in Section
2(a)(19) of the Act) of Frontegra;
(b) Rental of offices of the Corporation; and
(c) All expenses of promoting the sale of
Shares of the Funds other than expenses incurred in
complying with federal and state laws and the law of
any foreign country applicable to the issue, offer, or
sale of Shares of the Funds.
3. Investment Advisory Functions. In its
capacity as investment adviser, Frontegra shall have
the following responsibilities:
(a) To furnish continuous advice and
recommendations to the Funds, as to the acquisition,
holding or disposition of any or all of the securities
or other assets which the Funds may own or contemplate
acquiring from time to time;
(b) To cause its officers to attend meetings
and furnish oral or written reports, as the Corporation
may reasonably require, in order to keep the Directors
and appropriate officers of the Corporation fully
informed as to the condition of the investments of the
Funds, the investment recommendations of Frontegra, and
the investment considerations which have given rise to
those recommendations; and
(c) To supervise the purchase and sale of
securities or other assets as directed by the
appropriate officers of the Corporation.
The services of Frontegra are not to be deemed
exclusive and Frontegra shall be free to render similar
services to others as long as its services for others
does not in any way hinder, preclude or prevent
Frontegra from performing its duties and obligations
under this Agreement. In the absence of willful
misfeasance, bad faith, gross negligence or reckless
disregard of obligations or duties hereunder on the
part of Frontegra, Frontegra shall not be subject to
liability to the Corporation, the Funds, or to any
shareholder for any act or omission in the course of,
or connected with, rendering services hereunder or for
any losses that may be sustained in the purchase,
holding or sale of any security.
4. Obligations of the Corporation. The
Corporation shall have the following obligations under
this Agreement:
(a) To keep Frontegra continuously and fully
informed as to the composition of the Funds'
investments and the nature of all of its assets and
liabilities;
(b) To furnish Frontegra with a copy of any
financial statement or report prepared for it by
certified or independent public accountants, and with
copies of any financial statements or reports made to
the Funds' shareholders or to any governmental body or
securities exchange;
(c) To furnish Frontegra with any further
materials or information which Frontegra may reasonably
request to enable it to perform its functions under
this Agreement; and
(d) To compensate Frontegra for its services
in accordance with the provisions of paragraph 5
hereof.
5. Compensation. Each Fund shall pay to
Frontegra for its services a monthly fee, as set forth
on the Exhibits hereto, payable on the last day of each
month during which or during part of which this
Agreement is in effect. For the month during which
this Agreement becomes effective and any month during
which it terminates, however, there shall be an appro
priate proration of the fee payable for such month
based on the number of calendar days of such month
during which this Agreement is effective. Frontegra
may from time to time and for such periods as it deems
appropriate reduce its compensation (and/or assume
expenses) for one or more of the Funds.
6. Expenses Paid by Corporation.
(a) Except as provided in this paragraph,
nothing in this Agreement shall be construed to impose
upon Frontegra the obligation to incur, pay, or
reimburse the Corporation for any expenses not
specifically assumed by Frontegra under paragraph 2
above. Each Fund shall pay or cause to be paid all of
its expenses and the Fund's allocable share of the
Corporation's expenses, including, but not limited to,
investment adviser fees; any compensation, fees, or
reimbursements which the Corporation pays to its
Directors who are not interested persons (as that
phrase is defined in Section 2(a)(19) of the Act) of
Frontegra; fees and expenses of the custodian, transfer
agent, registrar or dividend disbursing agent; current
legal, accounting and printing expenses;
administrative, clerical, recordkeeping and bookkeeping
expenses; brokerage commissions and all other expenses
in connection with the execution of Fund transactions;
interest; all federal, state and local taxes (including
stamp, excise, income and franchise taxes); expenses of
shareholders' meetings and of preparing, printing and
distributing proxy statements, notices and reports to
shareholders; expenses of preparing and filing reports
and tax returns with federal and state regulatory
authorities; and all expenses incurred in complying
with all federal and state laws and the laws of any
foreign country applicable to the issue, offer, or sale
of Shares of the Funds, including but not limited to,
all costs involved in the registration or qualification
of Shares of the Funds for sale in any jurisdiction and
all costs involved in preparing, printing and
distributing prospectuses and statements of additional
information to existing shareholders of the Funds.
(b) if expenses borne by a Fund in any
fiscal year (including Frontegra's fee, but excluding
interest, taxes, fees incurred in acquiring and
disposing of Fund securities and, to the extent
permitted, extraordinary expenses), exceed those set
forth in any statutory or regulatory formula prescribed
by any state in which Shares of a Fund are registered
at such time, Frontegra will reimburse the Fund for any
excess.
7. Brokerage Commissions. For purposes of this
Agreement, brokerage commissions paid by a Fund upon
the purchase or sale of securities shall be considered
a cost of the securities of the Fund and shall be paid
by the respective Fund. Frontegra is authorized and
directed to place Fund transactions only with brokers
and dealers who render satisfactory service in the
execution of orders at the most favorable prices and at
reasonable commission rates, provided, however, that
Frontegra may pay a broker or dealer an amount of
commission for effecting a securities transaction in
excess of the amount of commission another broker or
dealer would have charged for effecting that
transaction, if Frontegra determines in good faith that
such amount of commission was reasonable in relation to
the value of the brokerage and research services
provided by such broker or dealer viewed in terms of
either that particular transaction or the overall
responsibilities of Frontegra. In placing Fund
business with such broker or dealers, Frontegra shall
seek the best execution of each transaction, and all
such brokerage placement shall be made in compliance
with Section 28(e) of the Securities Exchange Act of
1934 and other applicable state and federal laws.
Notwithstanding the foregoing, the Corporation shall
retain the right to direct the placement of all Fund
transactions, and the Directors may establish policies
or guidelines to be followed by Frontegra in placing
Fund transactions for the Funds pursuant to the
foregoing provisions.
8. Proprietary Rights. Frontegra has
proprietary rights in each Fund's name and the
Corporation's name. Frontegra may withdraw the use of
such names from the Fund or the Corporation.
9. Termination. This Agreement may be
terminated at any time, without penalty, by the
Directors of the Corporation or by the shareholders of
a Fund acting by the vote of at least a majority of its
outstanding voting securities (as that phrase is
defined in Section 2(a)(42) of the Act), provided in
either case that 60 days' written notice of termination
be given to Frontegra at its principal place of
business. This Agreement may be terminated by
Frontegra at any time by giving 60 days' written notice
of termination to the Corporation, addressed to its
principal place of business.
10. Assignment. This Agreement shall terminate
automatically in the event of any assignment (as the
term is defined in Section 2(a)(4) of the Act) of this
Agreement.
11. Term. This Agreement shall begin for each
Fund as of the date of execution of the applicable
Exhibit and shall continue in effect with respect to
each Fund (and any subsequent Funds added pursuant to
an Exhibit during the initial term of this Agreement)
for two years from the date of this Agreement and
thereafter for successive periods of one year, subject
to the provisions for termination and all of the other
terms and conditions hereof if such continuation shall
be specifically approved at least annually by the vote
of a majority of the Directors of the Corporation,
including a majority of the Directors who are not
parties to this Agreement or interested persons of any
such party (other than as Directors of the
Corporation), cast in person at a meeting called for
that purpose. If a Fund is added after the first
approval by the Directors as described above, this
Agreement will be effective as to that Fund upon
execution of the applicable Exhibit and will continue
in effect until the next annual approval of this
Agreement by the Directors and thereafter for
successive periods of one year, subject to approval as
described above.
12. Amendments. This Agreement may be amended by
the mutual consent of the parties, provided that the
terms of each such amendment shall be approved by the
Directors or by of the affirmative vote of a majority
of the outstanding voting securities (as that phrase is
defined in Section 2(a)(42) of the Act) of each Fund.
This Agreement will become binding on the parties
hereto upon their execution of the Exhibits to this
Agreement.
EXHIBIT A
to the
Investment Advisory Agreement
FRONTEGRA OPPORTUNITY FUND
For all services rendered by Frontegra hereunder,
the above-named Fund of the Corporation shall pay
Frontegra and Frontegra agrees to accept as full
compensation for all services rendered hereunder, an
annual investment advisory fee equal to 0.65 of 1% of
the average daily net assets of the Fund.
The portion of the fee based upon the average
daily net assets of the Fund shall be accrued daily at
the rate of 1/365th of 0.65 of 1% applied to the daily
net assets of the Fund.
The advisory fee so accrued shall be paid to
Frontegra monthly.
Executed this _____ day of _________________,
19___.
FRONTEGRA ASSET
MANAGEMENT, INC.
By:________________________________
Xxxxxxx X. Xxxxxxx, Co-President
FRONTEGRA FUNDS, INC.
By:________________________________
Xxxxxx X. Xxxxxxxx, Co-President
EXHIBIT B
to the
Investment Advisory Agreement
FRONTEGRA TOTAL RETURN BOND FUND
For all services rendered by Frontegra hereunder,
the above-named Fund of the Corporation shall pay
Frontegra and Frontegra agrees to accept as full
compensation for all services rendered hereunder, an
annual investment advisory fee equal to 0.40 of 1% of
the average daily net assets of the Fund.
The portion of the fee based upon the average
daily net assets of the Fund shall be accrued daily at
the rate of 1/365th of 0.40 of 1% applied to the daily
net assets of the Fund.
The advisory fee so accrued shall be paid to
Frontegra monthly.
Executed this _____ day of _________________,
19___.
FRONTEGRA ASSET
MANAGEMENT, INC.
By:________________________________
Xxxxxxx X. Xxxxxxx, Co-President
FRONTEGRA FUNDS, INC.
By:________________________________
Xxxxxx X. Xxxxxxxx, Co-President
