INVESTMENT ADVISORY AGREEMENT
THIS AGREEMENT, entered into as of the date that the registration statement
of the Quaker Mid-Cap Value Fund of the Quaker Investment Trust becomes
effective with the Securities and Exchange Commission, by and between QUAKER
INVESTMENT TRUST (the "Trust"), a Massachusetts business trust, and COMPU-VAL
INVESTMENTS, INC., a Delaware corporation (the "Advisor"), registered as an
investment advisor under the Investment Advisors Act of 1940, as amended (the
"Act").
BACKGROUND
WHEREAS, the Trust is registered as a 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 Advisor to furnish investment
advisory services to the Quaker Mid-Cap Value Fund series of the Trust pursuant
to the terms and conditions of this Agreement, and the Advisor is willing to so
furnish such services;
NOW, THEREFORE, in consideration of the foregoing and the agreements and
covenants herein contained, the parties hereto, intending to be legally bound
hereby, agree as follows:
1. Appointment. The Trust hereby appoints the Advisor to act as Investment
Advisor to the Quaker Mid-Cap Value Fund (the "Fund") series of the Trust for
the period and on the terms set forth in this Agreement. The Advisor 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 Advisor
with copies properly certified or authenticated of each of the following:
(a) The Trust's Declaration of Trust, as filed with the Commonwealth 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 and the resolution
approved by a majority of the outstanding shares of the Fund
authorizing the appointment of the Advisor and approving this
Agreement;
(d) The Trust's Registration Statement on Form N-1A promulgated under the
1940 Act and under the Securities Act of 1933, as amended (the "1933
Act"), relating to shares of beneficial interest of the Fund (herein
called the "Shares") as filed with the Securities and Exchange
Commission (the "SEC") and all amendments thereto;
(e) The Fund's Prospectus and Statement of Additional Information (such
Prospectus, together with the Statement of Additional Information, as
presently in effect and all amendments and supplements thereto are
herein called the "Prospectus").
The Trust will furnish the Advisor 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 Advisor 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 Advisor will determine from time to
time what securities and other investments will be purchased, retained or sold
by the Fund. The Advisor will provide the services under this Agreement in
accordance with the Fund's investment objectives, policies and restrictions as
such are set forth in the Prospectus from time to time. The Advisor further
agrees that it:
(a) Will conform its activities to all applicable Rules and Regulations of
the SEC and will, in addition, conduct its activities under this
Agreement in accordance with the 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 respective issuers or with any broker or
dealer. In placing orders with brokers or dealers, the Advisor will
attempt to obtain the best net price and the most favorable execution
of its orders. Consistent with this obligation, when the Advisor
believes two or more brokers of dealers are comparable in price and
execution, the Advisor may prefer: (i) brokers and dealers who provide
the Fund with research advice and other services, or who recommend or
sell Trust shares, and (ii) brokers who are affiliated with the Fund
or the Advisor; provided, however, that in no instance will portfolio
securities be purchased from or sold to the Advisor in principal
transactions;
(c) Will provide, at its own cost, all office space, facilities and
equipment necessary for the conduct of its advisory activities on
behalf of the Fund.
4. Services Not Exclusive. The advisory services to be furnished by the
Advisor hereunder are not to be deemed exclusive, and the Advisor shall be free
to furnish similar services to others so long as its services under this
Agreement are not impaired thereby; provided, however, that without the written
consent of the Trustees of the Trust, the Advisor will not serve as an
investment advisor to any other investment company having an investment
objective similar to that of the Fund.
5. Books and Records. In compliance with the requirements of Rule 31a-3
promulgated under the 1940 Act, the Advisor hereby agrees that all records which
it maintains for the benefit of the Fund are the property of the Fund and
further agrees to surrender promptly to the Fund any of such records upon the
Fund's request. The Advisor further agrees to preserve for the periods
prescribed by Rule 31a-2 promulgated under the 1940 Act, the records required to
be maintained by it pursuant to Rule 31a-1 promulgated under the 1940 Act that
are not maintained by others on behalf of the Fund.
6. Expenses. During the term of this Agreement, the Advisor will pay all
expenses incurred by it in connection with its investment advisory services
furnished to the Fund other than the cost of securities and other investments
(including brokerage commissions and other transaction charges) purchased or
sold for the Fund. In addition, in accordance with the Plan of Distribution
adopted by the Fund under the provisions of Rule 12b-1 promulgated under the
1940 Act, the Advisor agrees to pay, from the advisory fees paid to it
hereunder, the amounts set forth in Exhibit A attached hereto to qualified
brokers and dealers who are authorized to sell Fund shares and receive
compensation therefor.
7. Compensation. The Trust will pay the Advisor, and the Advisor will
accept as full compensation for its services rendered hereunder, an investment
advisory fee, computed at the end of each month and payable within five (5)
business days thereafter, equal to the annual rate of 0.75% of the average daily
net assets of the Fund. The Advisor hereby acknowledges that the expense ratio
for the Fund will be capped at 1.35% of average daily net assets of the Fund and
hereby agrees to waive its fees to the extent necessary to achieve such expense
ratio, on a basis that is pro rata to the fees charged by other providers of
services to the Fund.
8. Limitation of Liability. The Adviser shall not be liable for any error
of judgment, mistake of law or for any other loss suffered by the Fund 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 its part in the performance of its duties or from reckless
disregard by it of its obligations or duties under this Agreement.
9. Duration and Termination. This Agreement shall become effective upon the
date the registration statement of the Trust containing the Fund's Prospectus is
declared effective by the SEC and, unless sooner terminated as provided herein,
shall continue in effect for two years. 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 of Trustees 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 Advisor at any time upon 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 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 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. 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 on, and shall inure to the benefit of,
the parties hereto and their respective successors.
12. Counterparts. This Agreement may be executed in counterparts by the
parties hereto, each of which shall constitute an original, and all of which,
together, shall constitute one Agreement.
13. Governing Law. This Agreement shall be construed in accordance with,
and governed by, the laws of the Commonwealth of Pennsylvania.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their officers designated below as of the day and year first above
written
Attest: QUAKER INVESTMENT TRUST
By:_____________________________ By:____________________________
Title: Title:
Attest: COMPU-VAL INVESTMENTS, INC.
By:_____________________________ By:____________________________
Title: Title:
EXHIBIT A
12b-1 Fees
25% of management fee on amount of Fund shares sold for first 12 months
10% of management fee on such amount for succeeding 12 months
5% of management fee on such amount thereafter.
The foregoing shall be in effect with respect to Fund shares until such
shares are redeemed.
