MANAGEMENT AGREEMENT
between
Gold Capital Management, Inc.
and
Gold Bank Funds
(on behalf of the Gold Bank Money Market Fund)
THIS AGREEMENT, made and entered into as of the 31st day of December, 2001,
by and between Gold Bank Funds, a Delaware business trust (the "Trust") on
behalf of its Gold Bank Money Market Fund series (the "Fund"), and Gold Capital
Management, Inc. (the "Manager"), and which Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an original, but all
of which together shall constitute but one instrument.
WHEREAS the Trust was founded for the purpose of engaging in the business
of investing and reinvesting its property and assets and to operate as an
open-end, management investment company, as defined in the Investment Company
Act of 1940, as amended (the "Act"), under which it is registered with the U.S.
Securities and Exchange Commission (the "SEC"), and
WHEREAS the Manager is engaged in the business of supplying investment
advice and management services to registered investment companies, as an
independent contractor, and
WHEREAS the Trust and the Manager desire to enter into a contractual
arrangement whereby the Manager provides investment advice and management
services to the Trust, on behalf of the Fund, for a fee,
NOW THEREFORE, in consideration of the mutual promises herein contained,
and other good and valuable consideration, receipt of which is hereby
acknowledged, it is mutually agreed and contracted by and between the parties
hereto that:
1. The Trust hereby employs the Manager, for the period set forth in
Paragraph 6 hereof, and on the terms set forth herein, to render investment
advice and management service to the Fund, subject to the supervision and
direction of the Board of Trustees of the Trust. The Manager hereby accepts such
employment and agrees, during such period, to render the services and assume the
obligations herein set forth, for the compensation herein provided. The Manager
shall, for all purposes herein, be deemed to be an independent contractor, and
shall, unless otherwise expressly provided and authorized, have no authority to
act for or represent the Trust in any way, or in any other way be deemed an
agent of the Trust.
The Manager shall furnish the Fund investment management and administrative
services. Investment management shall include analysis, research and
discretionary portfolio management services consistent with the Fund's
objectives and policies. Administrative services shall include the services and
compensation of such members of the Manager's organization as shall be duly
elected officers and/or Trustees of the Trust and such other personnel as shall
be necessary to carry out its normal operations; rent; the cost of a transfer
and dividend disbursing agent or similar in-house services; bookkeeping;
accounting; and all other clerical and administrative functions as may be
reasonable and necessary to maintain the Trust's records and for it to operate
as an open-end management investment company. Exclusive of the management fee,
the Trust shall bear the cost of meetings of the Board of Trustees and
committees thereof, including the fees of the independent Trustees, the
custodian, the independent public accountant and legal counsel; the costs of
printing and mailing shareholder reports and Fund disclosure documents to
shareholders; all expenses incidental to holding shareholder meetings, including
the preparation, printing and mailing of notices and proxy materials, and proxy
solicitation; the cost of all fidelity bond and liability insurance approved for
the Trust or the Board; any trade association fees and the costs of any
extraordinary expenses such as those resulting from litigation to which the
Trust is a party; any interest, taxes, dues, fees and other charges of
governments and their agencies, including the cost of qualifying its shares for
sale in any jurisdiction, brokerage commissions or any other expenses incurred
by it which are not assumed herein by the Manager.
All property, equipment and information used by the Manager in the
management and administration of the Trust shall belong to the Manager. Should
the management and administrative relationship between the Trust and the Manager
terminate, the Trust shall be entitled to, and the Manager shall provide the
Trust, a copy of all information and records in the Manager's file necessary for
the Trust to continue its functions, which shall include computer systems and
programs in use as of the date of such termination; but nothing herein shall
prohibit thereafter the use of such information, systems or programs by the
Manager, so long as such does not unfairly interfere with the continued
operation of the Trust.
Subject to compliance with the requirements of the Act, the Manager may
retain as a sub-adviser to the Fund, at the Manager's own expense, any
investment adviser registered under the Investment Advisers Act of 1940.
2. a. The Manager (or its delegate) shall place and execute Fund
orders for the purchase and sale of portfolio securities with
broker-dealers. Subject to the obtaining the best available execution, the
Manager is authorized to place orders for the purchase and sale of
portfolio securities for the Fund with such broker-dealers as it may select
from time to time. Subject to subparagraph (b) below, the Manager is also
authorized to place transactions with brokers who provide research or
statistical information or analyses to the Fund, to the Manager, or to any
other client for which the Manager provides investment advisory services.
Subject to obtaining the best available execution, the Manager may also
place brokerage transactions with broker-dealers who sell shares of the
Fund. Broker-dealers who sell shares of the Fund shall only receive orders
for the purchase or sale of portfolio securities to the extent that the
placing of such orders is in compliance with the Rules of the SEC and the
National Association of Securities Dealers, Inc. The Manager also agrees
that it will cooperate with the Trust to execute instructions that
brokerage transactions be allocated to brokers or dealers who provide
benefits directly to the Trust or the Fund.
b. Notwithstanding the provisions of subparagraph (a) above and
subject to such policies and procedures as may be adopted by the Board of
Trustees and officers of the Trust, the Manager (or its delegate) is
authorized to pay a member of an exchange, broker or dealer an amount of
commission for effecting a securities transaction in excess of the amount
of commission another member of an exchange, broker or dealer would have
charged for effecting that transaction, in such instances where the Manager
has determined in good faith that such amount of commission was reasonable
in relation to the value of the brokerage and research services provided by
such member, broker or dealer, viewed in terms of either that particular
transaction or the Manager's overall responsibilities with respect to the
Fund and to other clients or funds for which the Manager exercises
investment discretion.
c. The Manager (or its delegate) is authorized to direct portfolio
transactions to a broker which is an affiliated person of the Manager or
the Trust in accordance with such standards and procedures as may be
approved by the Board in accordance with Rule 17e-1 under the Act, or other
rules promulgated by the SEC. Any transaction placed with an affiliated
broker must (i) be placed at best execution, and (ii) may not be a
principal transaction.
3. As compensation for the services to be rendered to the Trust and Fund by
the Manager under the provisions of this Agreement, the Trust agrees to pay from
the assets of the Fund monthly to the Manager an annual fee based on the average
total net assets of the Fund computed daily in accordance with its Agreement and
Declaration of Trust and By-laws as follows:
a. 0.50% of the average total net assets of the Fund.
b. The Manager may voluntarily or contractually agree to reduce any
portion of the compensation or reimbursement of expenses due to it pursuant
to this Agreement and may similarly agree to make payments to limit
expenses which are the responsibility of the Fund under this Agreement. Any
voluntary reduction or payment shall be applicable only to such specific
reduction or payment and shall not constitute an agreement to reduce any
future compensation or reimbursement due to the Manager hereunder or to
continue future payments. Any such reduction will be agreed upon prior to
accrual of the related expense or fee and will be estimated daily. Any fee
withheld shall be voluntarily reduced and any Fund expense paid by the
Manager voluntarily or pursuant to an agreed expense limitation may be
reimbursed by the Fund to the Manager in the first, second, or third (or
any combination thereof) fiscal year next succeeding the fiscal year of the
withholding, reduction, or payment to the extent permitted by applicable
law if the aggregate expenses for the next succeeding fiscal year, second
fiscal year or third succeeding fiscal year do not exceed any limitation to
which the Manager has agreed. Such reimbursement may be paid prior to the
Fund's payment of current expenses if so requested by the Manager even if
such payment may require the Manager to waive or reduce its fees hereunder
or to pay current Fund expenses.
4. It is understood and agreed that the services to be rendered by the
Manager to the Trust under the provisions of this Agreement are not to be deemed
exclusive, and the Manager shall be free to render similar or different services
to others so long as its ability to render the services provided for in this
Agreement shall not be impaired thereby.
5. It is understood and agreed that the Trustees, officers, agents,
employees and shareholders of the Trust may be interested in the Manager as
owners, employees, agents or otherwise, and that owners, employees and agents of
the Manager may be interested in the Trust as shareholders or otherwise. It is
understood and agreed that shareholders, officers, Trustees and other personnel
of the Manager are and may continue to be officers and Trustees of the Trust,
but that they receive no remuneration from the Trust solely for acting in those
capacities.
6. This Agreement shall become effective on December 31, 2001 provided it
is approved by the Board of Trustees of the Trust, including a majority of the
Trustees who are not parties to this Agreement or interested persons of any such
party, cast in person at a meeting called for the purpose of voting on such
approval and by the vote of a majority of the outstanding shares of the Fund as
prescribed by the Act. It shall remain in force for an initial period of two
years ending on December 30, 2003, and thereafter may be renewed for successive
annual periods beginning December 31 each year only so long as such renewal and
continuance is specifically approved at least annually by the Board of Trustees
or by vote of a majority of the outstanding shares of the Fund as prescribed by
the Act, and only if the terms and the renewal of this Agreement have been
approved by a vote of a majority of the Trustees of the Trust including a
majority of the Trustees who are not parties to this Agreement or interested
persons of any such party, cast in person at a meeting called for the purpose of
voting on such approval. No amendment to this Agreement shall be effective
unless the terms thereof have been approved by the vote of a majority of
outstanding shares of the Fund as prescribed by the Act (unless shareholder
approval of the amendment would not be required to be consistent with SEC
interpretations of Section 15 of the Act), and by vote of a majority of the
Trustees of the Trust who are not parties to this Agreement or interested
persons of any such party, cast in person at a meeting called for the purpose of
voting on such approval. It shall be the duty of the Board of Trustees of the
Trust to request and evaluate, and the duty of the Manager to furnish, such
information as may reasonably be necessary to evaluate the terms of this
Agreement and any amendment thereto.
7. This Agreement may be terminated at any time, without the payment of any
penalty, by the Board of Trustees of the Trust, or by the vote of a majority of
the outstanding voting shares of the Fund as prescribed by the Act on not more
than sixty (60) days written notice to the Manager, and it may be terminated by
the Manager upon not less than sixty (60) days written notice to the Trust. It
shall terminate automatically in the event of its assignment by either party
unless the parties hereby, by agreement, obtain an exemption from the SEC from
the provisions of the Act pertaining to the subject matter of this paragraph.
Any notice, request or instruction provided for herein, or for the giving of
which, the occasion may arise hereunder, shall be deemed duly given, if in
writing and mailed by registered mail, postage prepaid, addressed to the regular
executive office of the Trust or the Manager, as the case may be. As used in
this Agreement, the terms "assignment," "a majority of the outstanding voting
shares" and "interested persons" shall have the same meaning as similar terms
contained in the Act.
8. The Manager shall not be liable for any error in judgment or mistake at
law for any loss suffered by the Trust or Fund in connection with any matters to
which this Agreement relates, except that nothing herein contained shall be
construed to protect the Manager against any liability by reason of willful
misfeasance, bad faith or gross negligence in the performance of duties or by
reckless disregard of its obligations or duties under this Agreement.
Gold Bank Funds,
on behalf of its series, Gold Bank Money Market Fund
By: /s/ Xxxxxxx X. Xxxxx
-----------------------------------------------------
Xxxxxxx X. Xxxxx
President
ATTEST:
/s/ Xxxxxx X. Xxxxxx
---------------------------------
Xxxxxx X. Xxxxxx
Secretary
[SEAL]
Gold Capital Management, Inc.
By:/s/Xxxxxxx X. Xxxxxx
-----------------------------------------------------
ATTEST:
/s/ Xxxxxx X. Xxxxxx
---------------------------------
[SEAL]
