EXHIBIT 99.5
FORM OF INVESTMENT ADVISORY AGREEMENT
INVESTMENT ADVISORY AGREEMENT
August 19, 1994
ND Money Management, Inc.
000 Xxxxx Xxxxxxxx
Xxxxx, Xxxxx Xxxxxx 00000
Dear Sirs:
Integrity Fund of Funds, Inc. (the "Fund"), a corporation organized under
the laws of the State of North Dakota, herewith confirms its agreement with ND
Money Management, Inc. (the "Adviser"), as follows:
1. Investment description: *Appointment
The Fund desires to employ its capital by investing and reinvesting in
investments of the kind and in accordance with the limitations specified in its
Prospectus and Statement of Additional Information, as from time to time in
effect, and in such manner and to such extent as may from time to time be
approved by the Board of Directors of the Fund. Copies of the Fund's Prospectus
and Statement of Additional Information have been or will be submitted to the
Adviser. The Fund desires to employ and hereby appoints the Adviser to act as
its investment adviser. The Adviser accepts the compensation set forth below.
2. Services as Investment Adviser
Subject to the supervision and direction of the Board of Directors of
the Fund, the Adviser will (a) act in conformity with the Investment Company Act
of 1940 and the Investment Advisers Act of 1940, as the same may from time to
time be amended, (b) manage the Fund in accordance with the Fund's investment
objective(s) and policies as stated in the Fund's Prospectus and Statement of
Additional Information as from time to time in effect, (c) make investment
decisions for the Fund, and (d) place purchase and sale orders on behalf of the
Fund. In providing those services, the Adviser will provide investment research
and supervision of the Fund's investments and conduct a continual program of
investment, evaluation, and, if appropriate, sale and reinvestment of the Fund's
assets. In addition, the Adviser will furnish the Fund with whatever
statistical information the Fund may reasonably request with respect to the
securities that the Fund may hold or contemplate purchasing.
3. Brokerage
In executing transactions for the Fund and selecting brokers or
dealers, the Adviser will use its best efforts to seek the best overall terms
available. In assessing the best overall terms available
for any Fund transaction, the Adviser will consider all factors it deems
relevant including, but not limited to, breadth of the market in the security,
the price of the security, the financial condition and execution capability of
the broker or dealer, and the reasonableness of any commission for the specific
transaction and on a continuing basis. In selecting brokers or dealers to
execute a particular transaction and in evaluating the best overall terms
available, the Adviser may consider the brokerage and research services (as
those terms are defined in Section 28 (e) of the Securities Exchange Act of
1934) provided to the Fund and/or other accounts over which the Adviser
exercises investment discretion. The Adviser may utilize ND Capital, Inc., or
any other affiliated person of the Adviser as the broker for the purchase of
mutual fund shares and other securities.
4. Information Provided to the Fund
The Adviser will keep the Fund informed of developments materially
affecting the Fund and will, on its own initiative, furnish the Fund from time
to time with whatever information the Adviser believes is appropriate for this
purpose.
5. Standard of Care
The Adviser shall exercise its best judgment in rendering the services
listed in paragraphs 2 and 3 above. 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, provided that
nothing herein shall be deemed to protect or purport to protect the Adviser
against any liability to the Fund or to shareholders of the Fund to which the
Adviser would otherwise be subject by reason of willful misfeasance, bad faith,
or gross negligence on its part in the performance of its duties or by reason of
the Adviser's reckless disregard of its obligations and duties under this
Agreement.
6. Independent Contractor
The Adviser shall be deemed to be an independent contractor under this
Agreement and, unless otherwise expressly provided or authorized, shall have no
authority to act for or represent the Fund in any way or otherwise be deemed as
agent of the Fund.
7. Compensation
In consideration of the services rendered pursuant to this Agreement,
the Fund will pay the Adviser on the first business day of each month a fee for
the previous month at the annual rate of .90 of 1.00% of the Fund's average
daily net assets. The fee for the period from the date the Fund's initial
registration statement is declared effective by the Securities and Exchange
Commission to the end of the month during which the initial registration
statement is declared effective shall be prorated according to the proportion
that such period bears to the full monthly period. Upon any termination of this
Agreement before the end of a month, the fee for such part of that month shall
be prorated according to the proportion that such period bears to the full
monthly period and shall be payable upon the date of termination of this
Agreement. For the purpose of determining fees payable to the Adviser, the
value of the Fund's net assets shall be computed at the times and in the manner
specified in the Fund's Prospectus or Statement of Additional Information as
from time to time in effect.
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8. Expenses
The Adviser will bear all expenses in connection with the performance
of its services under this Agreement. The Fund will bear certain other expenses
to be incurred in its operation, including: organization expenses; taxes;
interest; brokerage fees and commissions, if any; fees and expenses of directors
and officers of the Fund who are not officers or directors of the Adviser;
Securities and Exchange Commission fees and state securities laws fees; charges
of custodians and transfer and dividend disbursing agents; insurance premiums;
outside auditing and legal expenses; costs of maintenance of the Fund's
existence; costs attributable to investor services, including, without
limitation, telephone and personnel expenses; costs of preparing and printing
prospectuses and statements of additional information for regulatory purposes
and for distribution to existing shareholders; costs of shareholders' reports
and meetings of the shareholders of the Fund and of the officers and Board of
Directors of the Fund; and any extraordinary expenses. In addition, the Fund is
expected to pay service fees to dealers for providing personal services to
shareholders and/or the maintenance of shareholder accounts.
9. Services to Other Companies or Accounts
The Fund understands that the Adviser may act in the future as
investment adviser to fiduciary and other managed accounts and as investment
adviser, to one or more other investment companies, and the Fund has no
objection to the Adviser so acting, provided that whenever the Fund and one or
more other accounts or investment companies advised by the Adviser have
available funds for investment, investments suitable and appropriate for each
will be allocated in accordance with a formula believed to be equitable to each
entity. Similarly, opportunities to sell securities will be allocated in an
equitable manner. The Fund recognizes that in some cases this procedure may
adversely affect the size of the position that may be acquired or disposed of
for the Fund. In addition, the Fund understands that the persons employed by
the Adviser to assist in the performance of the Adviser's duties hereunder will
not devote their full time to such service, and nothing contained herein shall
be deemed to limit or restrict the right of the Advisor or any affiliate of the
Adviser to engage in and devote time and attention to other businesses or to
render services of whatever kind or nature.
10. Term of Agreement
This Agreement shall continue until August 19, 1996, and thereafter
shall continue automatically for successive annual periods ending on August 19
of each year, provided such continuance is specifically approved at least
annually by (i) the Board of Directors of the Fund or (ii) a vote of a
"majority" (as defined in the Investment Company Act of 1940) of the Fund's
outstanding voting securities, provided that in either event the continuance is
also approved by a majority of the Board of Directors who are not "interested
persons" (as defined in said Act) of any party to this Agreement, by vote cast
in person at a meeting called for the purpose of voting on such approval. This
Agreement is terminable, without penalty, on 60 days' written notice, by the
Board of Directors of the Fund or by vote of holders of a majority of the Fund's
shares, or upon 90 days' written notice, by the Adviser. This Agreement will
also terminate automatically in the event of its assignment (as defined in said
Act).
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11. Limitation of Liability
This Agreement has been executed on behalf of the Fund by the
undersigned officer of the Fund in his capacity as an officer of the Fund. The
obligations of this Agreement shall be binding upon the assets and property of
the Fund only and shall not be binding upon any director, officer, or
shareholder of the Fund individually.
If the foregoing is in accordance with your understanding, kindly indicate
your acceptance hereof by signing and returning the enclosed copy hereof.
Very truly yours,
INTEGRITY FUND OF FUNDS, INC
By /Xxxxxx X. Xxxxxxx/
President
Accepted:
ND MONEY MANAGEMENT, INC.
By: /Xxxxxx X. Xxxxxxx/
Authorized Officer
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