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Exhibit 5
INVESTMENT ADVISORY AGREEMENT
Between
XXXXXXXX & COMPANY SECURITIES, INC.
and
XXXXXXXX-XXXXXXXX U. S. GOVERNMENT RESERVES SERIES
OF GRADISON CASH RESERVES TRUST
THIS AGREEMENT is made as of the 24th day of September, 1993, between XxXxxxxx &
Company Securities, Inc., an Ohio corporation (the "Adviser"), and
Xxxxxxxx-XxXxxxxx U. S. Government Reserves (the "Fund"), a series of Gradison
Cash Reserves Trust (the "Trust"), a Massachusetts business trust.
In consideration of the mutual covenants hereinafter contained, the parties
hereto agree as follows:
1. a. The Trust hereby employs the Adviser to manage the investment and
reinvestment of the assets of the Fund in accordance with the Fund's investment
objective and policies, and to perform certain other services herein set forth
and administer the Trust's affairs to the extent requested subject to the
supervision of the Board of Trustees of the Trust, for the period and on the
terms herein set forth.
b. The Adviser hereby accepts such employment, and agrees to render
such services and to assume the obligations herein set forth.
2. The Adviser shall:
a.-Manage the investment of the Fund's assets including the placing of
orders for purchases and sales and other investment transactions;
b.-Report periodically to the Trust with respect to the Fund's
investment programs and with respect to the Adviser's activities in connection
with the administration of the Fund;
c. In all matters relating to the performance of this Agreement, act in
conformity with the Declaration of Trust, By-Laws, and Registration Statement of
the Trust and with the instructions and directions of the Board of Trustees and
will comply with the requirements of the Investment Company Act of 1940 ("1940
Act"), the rules thereunder, and all other applicable federal and state laws and
regulations; and
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d.-Provide persons satisfactory to the Board of Trustees of the Trust
to act as officers of the Trust.
3. Any investment program undertaken by the Adviser pursuant to this Agreement,
and any other activities undertaken by the Adviser on behalf of the Fund, shall
at all times be subject to any directives of the Board of Trustees of the Trust,
or of any duly constituted committee of the Board, or of any officer of the
Trust acting pursuant to authority granted by the Board or by any such
committee.
4. In addition to performing the obligations set forth in Paragraph 2 hereof,
the Adviser shall assume and bear expenses incurred with respect to Trustees who
are affiliated with the Adviser, Officers who are necessary for the management,
operations, administration and investments of the Trust, office space, office
facilities, business equipment and utilities (including communications expense).
The payment or assumption by the Adviser of any expense of the Trust or the Fund
that the Adviser is not required by this Agreement to pay or assume shall not
obligate the Adviser to pay or assume the same or any similar expense of the
Trust or Fund on any subsequent occasion.
5. All expenses not specifically assumed by the Adviser under this Agreement or
any other agreement, or by another party pursuant to any other agreement, which
may be incurred in the operation of the Fund will be borne by the Fund. These
include:
a. Costs of preparing, printing and mailing, and expenses incurred in
connection with furnishing of information and administrative assistance with
respect to the preparation of; registration statements and prospectuses,
including amendments and revisions thereto, and annual, semiannual and other
periodic reports furnished to shareholders of the Fund or to regulatory
authorities; and other documents required by regulatory authorities; and notices
and proxy solicitation materials furnished to shareholders of the Fund;
b. Such distribution expenses or service fees as may be contemplated by
an effective plan pursuant to Rule 12b-1 under the 1940 Act, provided, however,
that any such payment by the Fund of distribution expenses shall be in the
amounts, and in accordance with the procedures, set forth in such plan;
c. Registration, filing and other fees in connection with requirements
of regulatory authorities;
d. Expenses of issue, sale, redemption and repurchase of shares of the
Fund;
e. Compensation of Trustees of the Trust who are not affiliated with
the Adviser;
f. Compensation and expenses of any transfer agent, dividend disbursing
agent, registrar, custodian or depository appointed by the Fund which may be the
Adviser;
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g. Any costs, expenses or other relief asserted against the Trust or
Fund for violation of any law;
h. Charges and expenses of independent accountants retained by the
Trust;
i. Brokers' commissions and issue or transfer taxes chargeable to the
Fund in connection with securities transactions to which the Fund is a party;
j. Any extraordinary expenses (including fees and disbursements of
counsel, costs of actions, suits or proceedings to which the Fund is a party and
the expenses the Fund may incur as a result of its legal obligation to provide
indemnification to officers, trustees, agents and shareholders of the Trust)
incurred by the Fund;
k. Taxes and other fees payable by the Fund to federal, state, or other
governmental agencies;
l. Costs of share certificates representing shares of the Fund, if
provided for;
m. Legal and accounting fees and expenses in connection with the
operations of the Fund, including its organization and the registration or
qualification of its shares with federal or state regulatory authorities;
n. Expenses incurred in connection with shareholders' or Trustees'
meetings;
o. Fees and other expenses incurred by the Fund in connection with its
membership in any organization, and;
p. Costs of liability, errors and omissions and other insurance and
fidelity bond.
6. The Fund shall reimburse the Adviser for the costs (salaries, benefits and
expenses) which are fairly allocable to legal services performed by the
Adviser's employees under this Agreement on behalf of the Fund.
7. The services of the Adviser to the Fund are not to be deemed exclusive, and
the Adviser shall be free to render similar services to other persons so long as
the services to be rendered hereunder are not impaired thereby. Nothing in this
Agreement shall limit or restrict the right of any director, officer or employee
of the Adviser to engage in any other business or to devote his time and
attention in part to any other business.
8. The Adviser assumes no responsibility or obligation under this Agreement
other than to render in good faith the services provided for herein; provided
that nothing herein shall be deemed to protect or purport to protect the Adviser
against any liability to the Fund or its shareholders to which the Adviser would
otherwise be subject by reason of willful
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misfeasance, bad faith or gross negligence in the performance of its duties
hereunder, or by reason of reckless disregard of its obligations and duties
hereunder. The Adviser shall not be responsible or liable for any action or
inaction of the Board of Trustees of the Trust or any committee thereof.
9. In addition to all other charges and expenses to be paid hereunder, the Fund
shall pay to the Adviser compensation for its services and facilities furnished
hereunder, at an annual rate computed in accordance with Schedule A attached
hereto. The fee shall be computed and accrued daily. The fee so computed and
accrued during each calendar month shall be paid to the Adviser on the first day
of the next month. If this Agreement becomes effective or terminates before the
end of any month, the fee for the period from the effective date to the end of
the month or from the beginning of such month to the date of termination, as the
case may be, shall be prorated according to the proportion which such period
bears to the full month in which such effectiveness or termination occurs.
10. The Adviser shall reimburse the Fund if and to the extent that expenses
borne by the Fund in any fiscal year exceed any expense limitation applicable to
the Fund imposed by any regulatory authority (as such limitations may be
established from time to time). During any fiscal year, the Adviser shall be
bound, in calculating the amount of any such excess, by the most stringent
applicable requirements of any state in which the shares of the Fund are
qualified for sale. Such excess expenses, if any, shall be determined and paid
on a monthly basis, subject to annual adjustment so that the aggregate of
reimbursements, if any, by the Adviser to the Fund for the fiscal year are in
the amount necessary to limit such expenses to the applicable expense
limitation.
11. Subject to compliance with the provisions of the 1940 Act and the duties and
conditions to which the Adviser is bound by Paragraph 3 of this Agreement, the
Fund hereby agrees that the Adviser may subcontract for the performance of any
of the services contemplated to be rendered by the Adviser hereunder.
12. It is mutually understood that trustees, officers, shareholders, employees
and agents of the Trust are or may be interested in the Adviser as directors,
officers, stockholders, employees, agents or in other capacities; that
directors, officers, stockholders, employees and agents of the Adviser are or
may be interested in the Trust as trustees, officers, shareholders, employees,
agents or in other capacities; that the Adviser may be interested in the Fund as
a shareholder or otherwise; and that the existence of any such dual interest
shall not affect the validity of this Agreement or of any transactions made
hereunder, except as may otherwise be provided in the Declaration of Trust of
the Trust or the Articles of Incorporation of the Adviser, or by any specific
provision of any applicable statute, rule or regulation.
13. This Agreement shall become effective as of the date first set forth above
and shall continue in effect until September 23, 1995. Thereafter, it shall
continue in effect from year to year, provided such continuance is specifically
approved at least annually, at
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meetings called for the purpose of voting upon such approvals, by the vote of a
majority of the outstanding voting securities of the Fund or by the vote of a
majority of the Board of Trustees of the Trust, and in either event by the vote
cast in person of a majority of the trustees of the Trust who are not interested
persons (as defined in the 0000 Xxx) of either party to this Agreement.
14. The Trust may at any time and without the payment of any penalty terminate
this Agreement as to the Fund upon 60 days' written notice to the Adviser,
either by action of the Board of Trustees of the Trust or by the vote of a
majority of the outstanding voting securities of the Fund, and the Adviser may
at any time and without the payment of any penalty terminate this Agreement upon
60 days' written notice to the Trust. This Agreement shall automatically
terminate in the event of its assignment (within the meaning of the 0000 Xxx) by
the Adviser, unless such automatic termination shall be prevented by an order of
exemption from the Securities and Exchange Commission.
15. This Agreement may be amended at any time by the mutual consent of the
parties, provided that such consent on the part of the Fund shall have been
approved, at meetings called for the purpose of voting upon such consent, by the
vote of a majority of the outstanding voting securities of the Fund, and by the
vote of a majority of the Board of Trustees of the Trust, including the vote
cast in person by a majority of the trustees of the Trust who are not interested
persons (as defined in the 0000 Xxx) of either party to this Agreement.
16. The parties to this Agreement acknowledge that the Adviser has an exclusive
proprietary interest in the use of the names "Gradison" and "McDonald" and
further acknowledge that the Adviser has consented to the use of such names by
the Fund subject to withdrawal of such consent upon 30 days' written notice to
the Trust. The Trust agrees that the names "Gradison" and "McDonald" will be
used by it only in connection with the business of any open-end management
investment company; that such names will be used only in such forms, styles and
contexts as may be approved by the Adviser; and that the Trust will not do or
cause to be done any act or undertaking which has the effect of contesting,
challenging or in any way impairing the Adviser's right, title or interest in or
to such names. The Trust agrees that it will not represent that it has any
right, title or interest in such names, and that the Trust's use of such names
shall not create any right, title or interest in its favor therein. Within 30
days after the termination of this Agreement for any reason, or after the
written withdrawal of such consent of the Adviser (with or without cause and
within the Adviser' sole discretion) the Trust
a. will cease and desist from every use of the names "Gradison" and
"McDonald" and will deliver to the Adviser all prospectuses, sales literature
and other advertising materials bearing such names;
b. will cause its name to be changed so as to eliminate the word
"Gradison" or "McDonald" therefrom; and
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c. will not at any time thereafter adopt or use any name, xxxx or other
trade designation which is confusingly similar to the names "Gradison" or
"McDonald" or likely to mislead the public.
17. Any notice required by or permitted to be given in connection with this
Agreement shall be in writing, addressed and delivered in person, or mailed
postage prepaid, to the addresses designated by the respective parties for the
receipt of such notice. Until further written notice, it is agreed that the
addresses of the Adviser and of the Trust, respectively, shall be:
XxXxxxxx & Co. Securities, Inc. Xxxxxxxx-XxXxxxxx U. S. Govt Xxxxxxxx-XxXxxxxx
U. S. Govt.
Attention: Xxxxxx Xxxxx Reserves Reserves
000 Xxxxxxxx Xxxxxx Attention: Xxxx X. Xxxxxx Attention: Xxxxxxx X. Xxxxxxxxxx
Xxxxxxxxx, Xxxx 00000 000 Xxxxxx Xxxxxx 000 Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxx 00000 Xxxxxxxxxx, Xxxx 00000
18. The shareholders of the Fund and, trustees, officers, employees and agents
of the Trust shall not personally be bound by or liable under this Agreement,
nor shall resort be had to their private property for the satisfaction of any
obligation or claim hereunder, as more fully provided under the terms of the
Declaration of Trust.
19. This Agreement shall be construed in accordance with the laws of the State
of Ohio. To the extent that the applicable laws of the State of Ohio conflict
with the applicable provisions of the 1940 Act, the latter shall control.
IN WITNESS WHEREOF, the parties have executed this Investment Advisory Agreement
as of the date first written above.
XXXXXXXX & COMPANY SECURITIES, INC. GRADISON CASH
RESERVES TRUST
By Xxxxxx X'Xxxxxxx By Xxxxxx X. Xxxxxx
Chairman Chairman
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Schedule A
Investment Advisory Fee
.50 of 1% of first $400 million of average daily net assets
.45 of l% of next $600 million of average daily net assets
.40 of l% of next $l billion of average daily net assets
.35 of l% of average daily net assets in excess of $2 billion
