EXHIBIT 99.2
PARAGON PORTFOLIO
0000 Xxxxx Xxxxx
Xxxxxxx, XX 00000
January 2, 1996
Xxxxxxx Xxxxx
Asset Management
Xxx Xxx Xxxx Xxxxx
Xxx Xxxx, XX 00000
Investment Advisory Agreement For Subadviser
--------------------------------------------
(Paragon Treasury Money Market Fund)
Dear Sirs:
Banc One Investment Advisors Corporation, an Ohio corporation with its principal
office in Westerville, Ohio (the "Investment Adviser"), is investment adviser to
Paragon Portfolio (the "Trust") on behalf of Paragon Treasury Money Market Fund
(the "Fund"). The Trust has been organized under the laws of Massachusetts to
engage in the business of an investment company. The shares of beneficial
interest of the Trust ("Shares") are divided into multiple series, including the
Fund, as established pursuant to a written instrument executed by the Trustees
of the Trust. Pursuant to authority granted the Adviser by the Trust's Trustees
and pursuant to the provisions of the Investment Advisory Agreement dated
January 2, 1996 between the Adviser and the Trust, the Adviser has selected you
to act as an investment subadviser of the Fund and to provide certain services,
as more fully set forth below, and you are willing to act as such investment
subadviser and to perform such services under the terms and conditions
hereinafter set forth. Accordingly, the Adviser and the Trust on behalf of the
Fund agree with you as follows:
I. ADVISORY SERVICES
Subject to the supervision of the Investment Adviser and the Trust's
Board of Trustees, you will provide a continuous investment program for
the Fund, including Investment research and management with respect to
all securities, investments and cash equivalents in the Fund's portfolio.
You will determine from time to time what securities and other
investments will be purchased, retained or sold by the Fund and will
place orders for purchases and sales on behalf of the Fund. You will
provide services under this Agreement in accordance with the Fund's
investment objective, policies and restrictions as stated in the Fund's
Prospectus and in resolutions of the Trust's Board of Trustees.
In the performance of your duties hereunder, you are and shall be an
independent contractor and unless otherwise expressly provided herein or
otherwise authorized in writing, shall have no authority to act for or
represent the Trust in any way or otherwise be deemed to be an agent of
the Trust or of the Adviser. You will make your officers and employees
available to meet with the Trust's officers and Trustees at least
quarterly on due notice to review the investments and investment program
of the Fund in the light of current and prospective economic and market
conditions.
In compliance with the requirements of Rule 31a-3 under the Investment
Company Act of 1940 (the "Act"), you agree that all records which you
maintain for the Fund are the property of the Fund. You further agree to
surrender promptly to the Fund any such records upon the Fund's request.
You agree to preserve for the periods prescribed by Rule 31c-2 under the
Act the records required to be maintained by Rule 31a-1 under the Act.
You will treat confidentially and as proprietary information of the Fund
all records and other information relative to the Fund and prior, present
or potential shareholders and will not use such records and information
for any purpose other than the performance of your responsibilities,
except after prior notification and approval in writing by the Fund.
Such approval shall not be unreasonably withheld and may not be withheld
where you may be exposed to civil or criminal contempt proceedings for
failure to comply when requested to divulge such information by duly
constituted authorities or when requested by the Fund.
II. ALLOCATION OF CHARGES AND EXPENSES
You will bear your own costs of providing services hereunder. Except as
aforesaid, you will not be required to pay any expenses of the Fund.
III. COMPENSATION OF THE SUBADVISER
For all investment management services to be rendered hereunder, the
Adviser will pay you on the last day of each month a fee, at an annual
rate equal to .10% of the average daily net assets, as defined below, of
the Fund. The "average daily net assets" of the Fund are defined as the
average of the values placed on the net assets as of 4:00 p.m. (New York
time), on each day on which the net asset value of the Fund's portfolio
is determined consistent with the provisions of Rule 22c-1 under the
Investment Company Act of 1940 or, if the Fund lawfully determines the
value
-2-
of the net assets of its portfolio as of some other time on each business
day, as of such time. The value of net assets of the Fund shall be
determined pursuant to the applicable provisions of the Declaration of
Trust of the Trust. If, pursuant to such provisions, the determination
of net asset value is suspended for any particular business day, then for
the purposes of this paragraph III, the value of the net assets of the
Fund as last determined shall be deemed to be the value of the net assets
as of the close of regular trading on the New York Stock Exchange, or as
of such other time as the value of the net assets of the Fund's portfolio
may lawfully be determined on that day. If the determination of the net
asset value of the Shares of the Fund has been suspended pursuant to the
Declaration of Trust of the Trust for a period including such month, you
compensation payable at the end of such month shall be computed on the
basis of the value of the net assets of the Fund as last determined
(whether during or prior to such month). If the Fund determines the
value of the net assets of its portfolio more than once on any day, the
last such determination thereof on that day shall be deemed to be the
sole determination thereof on that day for the purposes of this paragraph
III.
IV. LIMITATION OF LIABILITY
You 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 except a loss resulting from a breach of fiduciary
duty with respect to the receipt of compensation for services or except a
loss resulting from willful misfeasance, bad faith or gross negligence on
your part in the performance of your duties or from reckless disregard by
you of your obligations and duties under this Agreement. Any person,
even though also employed by you, who may be or become an employee of and
paid by the Fund shall be deemed, when acting within the scope of his
employment by the Fund, to be acting in such employment solely for the
Fund and not as your employee or agent. The Adviser shall indemnify you
for any damages and related expenses incurred by you as a result of the
performance of your duties hereunder, unless the same shall result from
behavior found by a final judicial determination to constitute willful
misfeasance, bad faith, gross negligence or a reckless disregard of your
obligations, as specified above.
V. DURATION AND TERMINATION OF THIS AGREEMENT
This Agreement shall remain in full force until May 31, 1996. This
Agreement may, on 45 days' written notice, be terminated at any time
without the payment of any penalty,
-3-
by the Board of Trustees, by vote of a majority of the outstanding voting
securities of the Fund, by the Adviser, or by you. This Agreement shall
automatically terminate in the event of its assignment. In interpreting
the provisions of this Agreement, the definitions contained in Section
2(a) of the Act (particularly the definitions of "interested person,"
"assignment" and "majority of the outstanding voting securities"), as
from time to time amended, shall be applied, subject, however, to such
exemptions as may be granted by the Securities and Exchange Commission by
any rule, regulation or order.
VI. AMENDMENT OF THIS AGREEMENT
No provisions 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. No amendment of this Agreement shall be effective
until approved by vote of the holders of a majority of the outstanding
voting securities of the Fund and by the Board of Trustees, including a
majority of the Trustees who are not interested persons of the Adviser,
you or the Trust, cast in person at a meeting called for the purpose of
voting on such approval.
It shall be your responsibility to furnish to the Trustees of the Trust
such information as may reasonably be necessary in order for such
Trustees to evaluate this Agreement or any proposed amendments thereto
for the purposes of casting a vote pursuant to paragraphs V or VI hereof.
VII. GOVERNING LAW
This Agreement shall be governed by and construed in accordance with the
laws of the State of New York.
VIII. 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. This Agreement may be
executed simultaneously in two or more counterparts, each of which shall
be deemed an original, but all of which together shall constitute one and
the same instrument.
The name "Paragon Portfolio" is the designation of the Trustees for the time
being under the Declaration of Trust dated October 2, 1989, as amended from time
to time, and all persons dealing with the Trust or the Fund must look solely to
the property of the Trust
-4-
or the Fund for the enforcement of any claims against the Trust as neither the
Trustees, offices, agents or shareholders assume any personal liability for
obligations entered into on behalf of the Trust. No series of the Trust
(including the Fund) shall be liable for any claims against any other series of
the Trust.
If you are in agreement with the foregoing, please sign the form of acceptance
on the accompanying counterpart of this letter and return one such counterpart
to the Trust and the other such counterpart to the Adviser, whereupon this
letter shall become a binding contract.
Yours very truly,
PARAGON PORTFOLIO
(On behalf of Paragon Treasury
Money Market Fund)
Attest:
By: Xxxxxxxxx Xxxxxx By: Xxxxxxx X. Xxxxxxx
---------------- ------------------
Xxxxxxxxx Xxxxxx Xxxxxxx X. Xxxxxxx
Legal Products Analyst Secretary of the Trust
BANC ONE INVESTMENT ADVISORS CORPORATION
Attest:
By: Xxxxxxx X. Xxxxx By: Xxxx X. Xxxxxx
---------------- --------------
Name Xxxxxxx X. Xxxxx Name Xxxx X. Xxxxxx
Title Senior Attorney Title SVP & CFO
XXXXXXX XXXXX ASSET MANAGEMENT
a separate operating division of
Xxxxxxx, Sachs & Co.
Attest:
By: Xxxxxxxxx Xxxxxx By: Xxxxxx Xxxx
---------------- -----------
Name Xxxxxxxxx Xxxxxx Name Xxxxxx Xxxx
Title Legal Products Analyst Title VP
-5-
