INVESTMENT ADVISORY AGREEMENT
THIS AGREEMENT, entered into as of December 31, 1997, by and between
WILLIAMSBURG INVESTMENT TRUST, a Massachusetts business trust (the "Trust"), on
behalf of THE XXXXXXXXX EQUITY FUND, and XXXXXXXXX & COMPANY LLC, a Virginia
limited liability company (the "Adviser"), registered as an investment adviser
under the Investment Advisers Act of 1940, as amended.
WHEREAS, the Trust is registered as a no-load, 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 Xxxxxxxxx Equity 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 Xxxxxxxxx Equity 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 Adviser 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 Bylaws (such Bylaws, as presently in effect
and as they shall from time to time be amended, are
herein called the "Bylaws");
(c) Resolutions of the Trust's Board of Trustees
authorizing the appointment of the Adviser and
approving this Agreement;
(d) The Trust's Registration Statement on Form N-1A under the 1940
Act and under the Securities Act of 1933 as amended, 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 Fund'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 of 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 SEC 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
the Adviser, 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.
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Notwithstanding the foregoing, the Adviser may obtain the services of
an investment counselor or sub-adviser of its choice subject to the
approval of the Board of Trustees. The cost of employing such counselor
or sub-adviser will be paid by the Adviser and not by the Fund.
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 so long as its services under
this Agreement are not impaired.
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 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 Rule 31a-2 under the 1940 Act
the records required to be maintained by it pursuant to Rule 31a-1
under the 1940 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 Fund. 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 the entire cost of the promotion and sale of
Fund shares.
Notwithstanding the foregoing, the Fund 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 administration 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;
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(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.
7. COMPENSATION. For the services provided and the expenses assumed by the
Adviser pursuant to this Agreement, the Fund will pay the Adviser and
the Adviser will accept as full compensation an investment advisory fee
at the annual rate of 0.75% of the daily average net assets of the
Fund, computed at the end of each month and payable within five (5)
business days thereafter.
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 compensation for services or a loss resulting from
wilful 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
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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 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 amounts paid in satisfaction of
judgments, in compromise or as fines or penalties), may be paid from
time to time by the Fund or Funds to which the conduct in question
related 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 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.
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The right of indemnification provided by this Subsection 8(b)
shall not be exclusive of or affect any of the rights to
indemnification 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 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.
9. DURATION AND TERMINATION. This Agreement shall be effective on the date
hereof and, unless sooner terminated as provided herein, shall continue
in effect until March 31, 1999. Thereafter, this Agreement shall be
renewable for successive periods of one year each, provided such
continuance is specifically approved annually:
(a) By a vote of the 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 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).
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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 this
change, waiver, discharge or termination is sought. No material
amendment of this Agreement shall be effective until approved by a vote
of the holders of a majority of the Fund's outstanding voting
securities (as defined in the 1940 Act).
11. SHAREHOLDER LIABILITY. The Adviser is hereby expressly put on notice of
the limitation of shareholder liability as set forth in the Agreement
and Declaration of Trust of the Trust, which is on file with the
Secretary of the Commonwealth of Massachusetts, and agrees that
obligations assumed by the Trust pursuant to this Agreement shall be
limited in all cases to the Fund and its assets. The Adviser agrees
that it shall not seek satisfaction of any such obligations from the
shareholders or any individual shareholder of the Fund, nor from the
Trustees or any individual Trustee of the Trust.
12. 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 and shall inure to the benefit of the parties hereto and their
respective successors.
13. APPLICABLE LAW. This Agreement shall be construed in accordance with,
and governed by, the laws of the Commonwealth of Virginia.
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: XXXXXXXXX & COMPANY LLC
By:______________________ By:__________________________
Title:___________________ Title:_______________________
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