INVESTMENT ADVISORY AGREEMENT
AGREEMENT made this 16th day of January, 2004, between Xxxxxxxx
Xxxxx Funds, Inc., a Wisconsin Corporation (the "Corporation"),
and Xxxxxxxx, Plumb and Associates, Inc., a Wisconsin corporation
(the "Adviser").
W I T N E S S E T H
WHEREAS, the Corporation is an open-end, management investment
company registered under the Investment Company Act of 1940, as amended
(the "1940 Act");
WHEREAS, the Corporation is authorized to issue shares of its
Common Stock, $.001 par value per share, in one or more series;
WHEREAS; the Adviser is registered as an investment adviser under
the Investment Advisers Act of 1940, as amended (the "Advisers Act"); and
WHEREAS, the Corporation desires to retain the Adviser to render
investment advisory services to certain of its series and the Adviser is
willing to render such services.
NOW, THEREFORE, in consideration of the premises and mutual
covenants hereinafter set forth, the parties hereto agree as follows:
1. Appointment of Adviser. The Corporation hereby appoints the
Adviser to act as investment adviser with respect to each mutual fund
series described on Exhibit A hereto (individually, a "Fund" and
collectively, the "Funds") for the periods and on the terms herein
set forth. The Adviser accepts such appointment and agrees to render
the services herein set forth, for the compensation herein provided.
Additional Funds may be added to this Agreement by amendment to
Exhibit A and without the necessity for reapproval of this Agreement
by any Fund then already covered by this Agreement.
2. Duties of Adviser.
(a) Subject to the general supervision of the Board of
Directors of the Corporation, the Adviser shall manage the investment
operations of each Fund and the composition of each Fund's assets,
including the purchase, retention and disposition thereof. In this
regard, the Adviser, with respect to each Fund:
(i) shall provide supervision of the Fund's assets,
furnish a continuous investment program for the Fund, determine from
time to time what investments or securities will be purchased, retained
or sold by the Fund, and what portion of the assets will be invested or
held uninvested as cash;
(ii) shall place orders pursuant to its determinations
either directly with the issuer or with any broker and/or dealer who
deals in the securities in which the Fund is active; in placing orders,
the Adviser shall be entitled to rely upon the provisions of Section
28(e) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"); and
(iii) may, on occasions when it deems the purchase
or sale of an asset to be in the best interests of the Fund as well
as one or more other clients (including any other investment company
or advisory account for which the Adviser acts as adviser), aggregate,
to the extent permitted by applicable laws and regulations, the
securities to be sold or purchased in order to obtain a more favorable
net price or execution; in such event, allocation of the securities
so purchased or sold, as well as the expenses incurred in the
transaction, will be made by the Adviser in the manner it considers
to be the most equitable and consistent with its fiduciary obligations
to the Fund and to such other clients.
(b) The Adviser, in the performance of its duties to each
Fund hereunder, shall (i) act in conformity with the Articles and
By-Laws of the Corporation; the Prospectus, Statement of Additional
Information and Registration Statement in respect of the Fund; all
codes, policies and procedures maintained by the Company and
applicable to the Adviser, including without limitation codes of
ethics or conduct and proxy voting policies; and the instructions
and directions of the Board of Directors of the Corporation; and
(ii) comply with and conform to the requirements of the 1940 Act,
the Securities Act of 1933, as amended, the Exchange Act and all
other applicable federal and state laws, regulations and rulings.
(c) The Adviser shall at all times maintain its
registration as an investment adviser under the Advisers Act and
comply in all material respects with the requirements of the Advisers Act.
(d) The Adviser shall provide, at its own expense, such
office space, personnel, facilities, equipment and other materials,
resources and assets as are necessary or appropriate for the provision
of its services hereunder.
(e) The Adviser shall render to the Board of Directors
of the Corporation such periodic and special reports and information
as the Board may reasonably request.
(f) The services of the Adviser hereunder are not deemed
exclusive and the Adviser shall be free to render similar services to
others so long as its services under this Agreement are not impaired
thereby.
(g) Subject to Section 36 of the 1940 Act, the Adviser
shall not be liable for any error of judgment or mistake of law or
for any loss suffered by the Fund in connection with the matters to
which this Agreement relates, except for liability to a Fund or its
shareholders to which the Adviser would otherwise be subject by reason
of willful misfeasance, bad faith, or gross negligence, in the
performance of its duties, or by reason of its reckless disregard of
its obligations and duties under this Agreement.
3. Expenses.
(a) During the term of this Agreement, the Adviser will
pay all costs incurred by it in connection with the performance of
its duties under paragraph 2 hereof, other than the cost (including
taxes and brokerage commissions, if any) of assets purchased or sold
for the Fund.
(b) In addition to the foregoing, the Adviser may from
time to time at its option (but shall be under no obligation to)
voluntarily assume or undertake to reimburse a Fund for all or a
portion of its expenses not otherwise required to be borne or reimbursed
by the Adviser. Any such voluntary assumption or undertaking may be
discontinued or modified at any time by the Adviser.
4. Compensation. For the services provided and the expenses
assumed by the Adviser pursuant to this Agreement, each Fund will pay
the Adviser, and the Adviser agrees to accept as full compensation for
all services rendered by it hereunder, an annual management fee as shown
on Exhibit A attached hereto. The foregoing fee will be computed based
on the value of net assets on each day and will be paid to the Adviser
monthly in arrears.
5. Books and Records. The Adviser shall maintain all of the Fund's
records that relate to the provision of investment advisory services and
transactions in portfolio securities for the Fund. The Adviser agrees
that all records which it maintains for the Fund are the property of
the Fund and it will surrender promptly to the Fund any of such records
upon the Fund's request. The Adviser further agrees to preserve for the
periods prescribed by Rule 31a-2 of the Commission under the 1940 Act
any such records as are required to be maintained by it pursuant to
Rule 31a-1 of the Commission under the 1940 Act.
6. Duration and Termination. This Agreement will become effective
with respect to a Fund upon approval of a majority of the outstanding
voting securities of such Fund (as defined in the 1940 Act). Unless
terminated as hereinafter provided, this Agreement shall continue in
effect for two years from effectiveness of this Agreement as to such
Fund, and thereafter shall continue automatically for successive periods
of one year each so long as each such latter continuance is approved at
least annually by (i) the vote of a majority of the Board of Directors
of the Corporation who are not parties to this Agreement or "interested
persons" (as defined in the 0000 Xxx) of any such party, cast in person
at a meeting called for the purpose of voting on such approval; and
(ii) either by a vote of a majority of the Board of Directors of the
Corporation or by vote of a majority of the outstanding shares of such
Fund (as defined with respect to voting securities in the 1940 Act).
This Agreement may be terminated as to any Fund at any time, without
the payment of any penalty, by the Board of Directors of the Corporation
or by vote of a majority of the outstanding shares of such Fund (as so
defined) on 60 days' written notice to the Adviser, or by the Adviser
at any time, without the payment of any penalty, on 60 days' written
notice to the Corporation. This Agreement will automatically and
immediately terminate in the event of its assignment (as defined in the
1940 Act and the rules thereunder).
7. Name of the Fund. The Adviser agrees that the words
"Xxxxxxxx Xxxxx," "Xxxxxxxx" or "Xxxxx" may be used in the name of the
Corporation and any mutual fund series and that such name, any related
logos and any service marks containing the words "Xxxxxxxx Plumb,"
"Xxxxxxxx" or "Xxxxx" may be used in connection with their business
in perpetuity and that such use shall be royalty free, whether or not
this Agreement or any other advisory agreement is in effect for
the Funds. The Corporation acknowledges that it has no rights to the
name "Xxxxxxxx Plumb," "Xxxxxxxx" or "Xxxxx" or such logos or service
marks other than those granted in this paragraph and that the Adviser
reserves to itself the right to grant the nonexclusive right to use
the words "Xxxxxxxx Xxxxx," "Xxxxxxxx" or "Xxxxx" or such logos or
service marks to any other person, including, but not limited to,
another investment company.
8. Status of Adviser as Independent Contractor. The Adviser
shall for all purposes herein be deemed to be an independent contractor
and shall, unless otherwise expressly provided herein or authorized
by the Board of Directors of the Corporation from time to time, have
no authority to act for or represent the Corporation in any way or
otherwise be deemed an agent of the Corporation.
9. Amendment of Agreement. This Agreement may be amended by
mutual consent, but the consent of a Fund must be approved (a) by
vote of a majority of those Directors of the Corporation who are not
parties to this Agreement or interested persons
(as defined in the 0000 Xxx) of any such party, which vote shall be
cast in person at a meeting called for the purpose of voting on such
amendment, and (b) if such amendment materially changes the advisory
relationship or this Agreement or otherwise requires shareholder
approval under the 1940 Act, by vote of a majority of the
outstanding shares of such Fund (as defined with respect to voting
securities in the 1940 Act).
10. Miscellaneous. 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 construed in accordance with applicable federal
law and the laws of the State of Wisconsin and shall be binding up
and shall inure to the benefit of the parties hereto and their
respective successors, subject to paragraph 6 hereof. Anything
herein to the contrary notwithstanding, this Agreement shall not
be construed to require, or to impose any duty upon, either of the
parties to do anything in violation of any applicable laws or
regulations. This Agreement supersedes any prior agreement between
the parties with respect to the subject matter hereof.
IN WITNESS WHEREOF, the parties hereto have caused this
instrument to be executed as of the day and year first above written.
XXXXXXXX PLUMB FUNDS, INC.
By:
/s/Xxxx X. Xxxxxxxx, Chairman
XXXXXXXX, PLUMB AND ASSOCIATES,INC.
By:
/s/Xxxxxx X. Xxxxx, President
XXXXXXXX, PLUMB AND ASSOCIATES, INC.
EXHIBIT A TO INVESTMENT ADVISORY AGREEMENT
BETWEEN XXXXXXXX XXXXX FUNDS, INC.
AND
XXXXXXXX, PLUMB AND ASSOCIATES, INC.
1. Select Fund.
The management fee for this Fund, calculated in accordance with
Paragraph 4 of the Investment Advisory Agreement, shall be at the
annual rate of 1.00% of the first $50 million of average daily net
assets of the Fund, and 0.90% of average daily net assets in excess
of $50 million.
2. Blue Chip Fund.
The management fee for this Fund, calculated in accordance with
Paragraph 4 of the Investment Advisory Agreement, shall be at the
annual rate of 1.00% of the first $50 million of average daily net
assets of the Fund, and 0.90% of average daily net assets in
excess of $50 million.
3. Balanced Fund.
The management fee of this Fund, calculated in accordance with
Paragraph 4 of the Investment Advisory Agreement, shall be at the
annual rate of 0.85% of the first $50 million of average daily net
assets of the Series, and 0.80% of average daily net assets in excess
of $50 million.
