EX-99.23.d(ii)
INVESTMENT ADVISORY AGREEMENT
This Agreement is made as of [_______, 2005], between Fairport Funds, an
Ohio business trust (the "Trust"), and Xxxxxxxx & Company, Inc., an Ohio
corporation (the "Adviser").
WHEREAS, the Trust is registered as an open-end management investment
company under the Investment Company Act of 1940, as amended ("1940 Act"); and
WHEREAS, the Trust desires to continue to retain the Adviser to furnish
investment advisory services to the current investment portfolio of the Trust
and may retain the Adviser to serve in such capacity to certain additional
investment portfolios of the Trust, all as now or hereafter may be identified in
Schedule A hereto (such current investment portfolio and any such additional
investment portfolios together called the "Funds") and the Adviser represents
that it is willing and possesses legal authority to so furnish such services;
NOW, THEREFORE, in consideration of the mutual agreements and covenants
contained in this Agreement, the parties hereto agree as follows:
ss.1. Appointment. The Trust hereby appoints the Adviser to act as
-----------
investment adviser to the Funds for the period and on the terms and subject to
the conditions set forth in this Agreement. The Adviser accepts such appointment
and agrees to furnish the services herein set forth for the compensation herein
provided. Additional investment portfolios may from time to time be added to
those covered by this Agreement by the parties executing a new Schedule A which
shall become effective upon its execution and shall supersede any Schedule A
having an earlier date.
ss.2. Investment Advisory Services. Subject to the supervision of the
------------------------------
Trust's Board of Trustees, the Adviser shall provide a continuous investment
program for the Funds, including investment, research and management with
respect to all securities and investments and cash equivalents in the Funds. The
Adviser shall determine from time to time what securities and other investments
will be purchased, retained or sold by the Trust with respect to the Funds. The
Adviser shall provide the services under this Agreement in accordance with each
of the Fund's investment objectives, policies, and restrictions as stated in
such Fund's most current Prospectus and Statement of Additional Information, as
then in effect, and all amendments or supplements thereto, and resolutions of
the Trust's Board of Trustees as may be adopted from time to time. The Adviser
further agrees that it:
(a) will use the same skill and care in providing such services as it uses
in providing services to any fiduciary accounts for which it has
investment responsibilities;
(b) will conform with all applicable Rules and Regulations of the
Securities and Exchange Commission (the "Commission") and, in
addition, will conduct its activities under this Agreement in
accordance with any applicable regulations of any governmental
authority pertaining to the investment advisory activities of the
Adviser;
(c) will place orders pursuant to its investment determinations for the
Funds either directly with the issuer or with any broker or dealer. In
placing orders with brokers and dealers, the Adviser will attempt to
obtain and is hereby directed to obtain prompt execution of orders in
an effective manner at the most favorable price. Consistent with this
obligation, the Adviser may, in its discretion, purchase and sell
portfolio securities to and from brokers and dealers who provide the
Adviser with brokerage and research services (within the meaning of
Section 28(e) of the Securities Exchange Act of 1934). Subject to the
review of the Trust's Board of Trustees from time to time with respect
to the extent and continuation of this policy, the Adviser is
authorized to pay a broker or dealer who provides such brokerage and
research services a commission for effecting a securities transaction
for any of the Funds which is in excess of the amount of commission
another broker or dealer would have charged for effecting that
transaction if, but only if, the Adviser determines in good faith that
such commission was reasonable in relation to the value of the
brokerage and research services provided by such broker or dealer,
viewed in terms of either that particular transaction or the overall
responsibilities of the Adviser with respect to the accounts as to
which it exercises investment discretion. In no instance will
portfolio securities be purchased from or sold to Xxxxxxxx Research
Corp., the Adviser, or any affiliated person of the Trust, Xxxxxxxx
Research Corp. or the Adviser unless otherwise permitted by the 1940
Act, an exemption therefrom, or an order thereunder;
(d) will maintain all books and records with respect to the securities
transactions of the Funds and will furnish the Trust's Board of
Trustees such periodic and special reports as the Board may request;
and
(e) will advise and assist the officers of the Trust in taking such
actions as may be necessary or appropriate to carry out the decisions
of the Trust's Board of Trustees and of the appropriate committees of
such Board regarding the conduct of the business of the Funds.
ss.3. Expenses. During the term of this Agreement, the Adviser will pay all
--------
expenses incurred by it in connection with its activities, duties and
obligations under this Agreement, other than the costs of securities (including
brokerage fees, if any) purchased for the Funds.
ss.4. Compensation. For the services provided and the expenses assumed
------------
pursuant to this Agreement, each of the Funds will pay the Adviser and the
Adviser will accept as full compensation therefor a fee set forth on Schedule A
hereto. The obligations of the Funds to pay the above-described fee to the
Adviser will begin as of the effective date of this Agreement (or effective date
of Schedule A with respect to Funds added thereto after the date hereof).
ss.5. Limitation of Liability. The Adviser shall not be liable for any
-------------------------
error of judgment or mistake of law or for any loss suffered by the Funds 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 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.
ss.6. Duration and Termination. This Agreement will become effective as of
------------------------
the date first written above (or, if a particular Fund is not in existence on
that date, on the date a registration statement relating to that Fund becomes
effective with the Commission) (the "Effective Date"), provided that it shall
have been approved by vote of a majority of the outstanding voting securities of
such Fund, in accordance with the requirements, if any, under the 1940 Act, and,
unless sooner terminated as provided herein, shall continue in effect until the
second anniversary of the Effective Date.
Thereafter, if not terminated, this Agreement shall continue in effect as
to a particular Fund for successive periods of twelve months each, provided such
continuance is specifically approved at least annually (a) by the vote of a
majority of those members of the Trust's Board of Trustees who are not parties
to this Agreement or interested persons of any party to this Agreement, cast in
person at a meeting called for the purpose of voting on such approval, and (b)
by the vote of a majority of the Trust's Board of Trustees or by the vote of a
majority of all votes attributable to the outstanding shares of such Fund.
Notwithstanding the foregoing, this Agreement may be terminated as to a
particular Fund at any time on sixty days' written notice, without the payment
of any penalty, by the Trust (by vote of the Trust's Board of Trustees or by
vote of a majority of the outstanding voting securities of such Fund) or by the
Adviser. This Agreement will immediately terminate in the event of its
assignment. (As used in this Agreement, the terms "majority of the outstanding
voting securities," "interested persons" and "assignment" shall have the same
meanings as ascribed to such terms in the 1940 Act.)
ss.7. Name. The Trust hereby acknowledges that the name "Xxxxxxxx" is a
----
property right of the Adviser. The Adviser agrees that the Trust and the Funds
may, so long as this Agreement remains in effect, use "Xxxxxxxx" as part of its
name. The Adviser may permit other persons, firms or corporations, including
other investment companies, to use such name and may, upon termination of this
Agreement, require the Trust and the Funds to refrain from using the name
"Xxxxxxxx" in any form or combination in its name or in its business or in the
name of any of its Funds, and the Trust shall, as soon as practicable following
its receipt of any such request from the Adviser, so refrain from using such
name.
ss.8. Adviser's Representations. The Adviser hereby represents and warrants
-------------------------
that it is willing and possesses all requisite legal authority to provide the
services contemplated by this Agreement without violation of applicable laws and
regulations.
ss.9. Amendment of this Agreement. No provision of this Agreement may be
----------------------------
changed, waived, discharged or terminated orally, but only by an instrument in
writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought.
ss.10. Miscellaneous. The captions in this Agreement are included for
-------------
convenience of reference only and in no way define or delimit 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 this Agreement shall not be
affected thereby. This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors and shall be
governed by the laws of the State of Ohio.
Fairport Funds is a business trust organized under Chapter 1746, Ohio
Revised Code and under a Declaration of Trust, to which reference is hereby made
and a copy of which is on file at the office of the Secretary of State of Ohio
as required by law, and to any and all amendments thereto so filed or hereafter
filed. The obligations of "Fairport Funds" entered into in the name or on behalf
thereof by any of the Trustees, officers, employees or agents are made not
individually, but in such capacities, and are not binding upon any of the
Trustees, officers, employees, agents or shareholders of the Trust personally,
but bind only the assets of the Trust, as set forth in Section 1746.13(A), Ohio
Revised Code, and all persons dealing with any of the Funds of the Trust must
look solely to the assets of the Trust belonging to such Fund for the
enforcement of any claims against the Trust.
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.
FAIRPORT FUNDS
By
------------------------
Name
-----------------------
Title
----------------------
XXXXXXXX & COMPANY, INC.
By
------------------------
Name
-----------------------
Title
----------------------
Dated December ____, 2005
Schedule A
to the
Investment Advisory Agreement
between Fairport Funds and
Xxxxxxxx & Company, Inc.
dated as of December ____, 2005
Name of Fund Compensation*
------------ ------------
Xxxxxxxx Government Securities Fund Annual rate of twenty-five one-hundredths of one
percent (.25%) of the average daily net assets of such
Fund up to $100 Million and one hundred twenty-five one
thousandths of one percent (0.125%) of the average
daily net assets of such Fund of $100 Million or more.
XXXXXXXX & COMPANY, INC. FAIRPORT FUNDS
By By
-------------------- -----------------------
Name Name
------------------ ---------------------
Title Title
----------------- ---------------------
* All fees are computed and paid monthly.
