Exhibit 99
Sub-Item 77Q1(e)
INVESTMENT ADVISORY AGREEMENT
AGREEMENT made this 30th day of June, 1997 by and between
Focus Trust, Inc. (the "Corporation"), a Maryland corporation
and Focus Capital Advisory, L.P. (the "Adviser"), a
Pennsylvania limited partnership.
1. Duties of Adviser. The Corporation hereby appoints
the Adviser to act as investment adviser to Focus Trust, Inc.
for the period and on such terms set forth in this Agreement.
The Corporation employs the Adviser to manage the investment
and reinvestment of the assets of the Corporation, to determine
in it discretion the assets to be held uninvested, to provide
the Corporation with records concerning the Adviser's
activities which the Corporation is required to maintain, and
to render regular reports to the Corporation's officers and
Board of Directors concerning the Adviser's discharge of the
foregoing responsibilities. The Adviser shall discharge the
foregoing responsibilities subject to the control of the
officers and the Board of Directors of the Corporation, and in
compliance with the objectives, policies and limitations set
forth in the Corporation's Prospectus and Statement of
Additional Information then in effect. The Adviser accepts
such employment and agrees to render the services and to
provide, at its own expense, the office space, furnishings,
equipment and the personnel required by it to perform the
services on the terms and for the compensation provided herein.
2. Portfolio Transactions. The Adviser shall provide
the Corporation with a trading department. The Adviser shall
select the brokers or dealers that will execute the purchases
and sales of securities for the Corporation and is directed to
use its best efforts to ensure that the best available price
and most favorable execution of securities transactions for the
Corporation are obtained. The Corporation will bear all
expenses associated with its investment activities, including,
without limitation, brokerage commissions and custody expenses.
Subject to policies established by the Board of Directors of
the Corporation and communicated to the Adviser, it is
understood that the Adviser will not be deemed to have acted
unlawfully, or to have breached a fiduciary duty to the
Corporation or in respect of the Corporation, or be in breach
of any obligation owing to the Corporation or in respect of the
Corporation under this Agreement, or otherwise, solely by
reason of its having caused the Corporation to pay a member of
a securities exchange, a broker or a dealer a commission for
effecting a securities transaction for the Corporation in
excess of the amount of commission another member of an
exchange, broker or dealer would have charged if the Adviser
determines in good faith that the commission paid was
reasonable in relation to the brokerage or research services
provided by such member, broker or dealer, viewed in terms of
that particular transaction or the Adviser's overall
responsibilities with respect to the accounts, including the
Corporation, as to which it exercises investment discretion.
The Adviser will communicate on a quarterly to the officers and
directors of the Corporation such information relating to
Corporation transactions as they may reasonably request.
3. Compensation of the Adviser. For the services to
be rendered by the Adviser as provided in Section 1 and 2 of
this Agreement, the Corporation shall pay to the Adviser within
five business days after the end of each calendar month, a
monthly fee of one twelfth of 0.70% of the Corporation's
average daily net assets for the month. The net asset value
shall be calculated in the manner as provided in the
Corporation's Prospectus and Statement of Additional
Information then in effect.
In the event of termination of this Agreement, the fee
provided in this Section 3 shall be paid on a pro rate basis,
based on the number of days when this Agreement was in effect.
4. Reports. The Corporation and the Adviser agree to
furnish to each other such information regarding their
operations with regard to their affairs as each may reasonably
request.
5. Status of Adviser. The services of the Adviser to
the Corporation are not to be deemed exclusive, and the Adviser
shall be free to render similar services to others so long as
its services to the Corporation are not impaired thereby.
6. Liability of Adviser. In the absence of willful
misfeasance, bad faith, gross negligence or reckless disregard
by the Adviser of its obligations and duties hereunder, the
Adviser shall not be subject to any liability whatsoever to the
Corporation, or to any shareholder of the Corporation, for any
error of judgment, mistake of law or any other act or omission
in the course of, or connected with, rendering services
hereunder including, without limitation, for any losses that
may be sustained in connection with the purchase, holding,
redemption or sale of any security on behalf of the
Corporation.
7. Duration and Termination. This Agreement shall
become effective on the date which the U.S. Securities and
Exchange Commission declares effective, the Corporation's
registration statement provided that first it is approved by
the Board of Directors of the Corporation, including a majority
of those directors who are not parties to this Agreement or
interested persons of any party hereto, in the manner provided
in section 15(c) of the Investment Company Act of 1940, and by
the holders of a majority of the outstanding voting securities
of the Corporation; and shall continue in effect for two years.
Thereafter, this Agreement may continue in effect only if such
continuance is approved at least annually by: (i) the
Corporation's Board of Directors or, (ii) by the vote of a
majority of the outstanding voting securities of the
Corporation; and in either event by a vote of a majority of
those directors of the Corporation who are not parties to this
Agreement or interested persons of any such party in the manner
provided in section 15(c) of the Investment Company Act of
1940. This Agreement may be terminated by the Corporation at
any time, without the payment of any penalty, by the Board of
Directors of the Corporation or by vote of the holders of a
majority of the outstanding voting securities of the
Corporation on 60 days' written notice to the Adviser. This
Agreement may be terminated by the Adviser at any time, without
the payment of any penalty, upon 60 days' written notice to the
Corporation. This Agreement will automatically terminate in
the event of its assignment. Any notice under this Agreement
shall be given in writing, addressed and delivered or mailed
postpaid, to the other party at the principal office of such
party.
As used in this Section 8, the terms "assignment"
"interested person", and "a vote of a majority of the
outstanding voting securities" shall have the respective
meanings set forth in Section 2(a)(4), Section 2(a)(19) and
Section 2(a)(42) of the 1940 Act and Rule 18f-2 thereunder.
8. Name of Adviser. The parties agree that the
Adviser has a proprietary interest in the name "Focus Trust,
Inc." and the Corporation agrees to promptly take such action
as may be necessary to delete from its corporate name and/or
the name of the Corporation any reference to the name of the
Adviser on the name "Focus Trust, Inc." promptly after receipt
from the Adviser of a written request therefore.
9. Severability. If any provisions 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.
10. Governing Law. This agreement shall be governed by
and construed and interpreted in accordance with the laws of
the Commonwealth of Pennsylvania.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed on the date hereinabove set forth.
ATTEST: FOCUS TRUST, INC.
_____________________
Xxxxxx X. Xxxxxxxx, Xx., President
______________
Xxxxxxxx X. Xxxxxxxxx, Secretary
ATTEST: FOCUS CAPITAL ADVISORY, L.P.
_________________________________
Xxxxxx X. Xxxxxxxx, Xx., General Partner
______________________________
Xxxxxxxx X. Xxxxxxxxx
