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EXHIBIT 5(L)
FORM
ARMADA FUNDS
SMALL CAP GROWTH FUND
WELLINGTON MANAGEMENT COMPANY, LLP
SUB-ADVISORY AGREEMENT
AGREEMENT made as of , 1997 between NATIONAL CITY BANK (the
"Adviser"), and WELLINGTON MANAGEMENT COMPANY, LLP (the "Sub-Adviser").
WHEREAS, ARMADA FUNDS, a Massachusetts business trust (the "Trust"), is
registered as an open-end, management investment company under the Investment
Company Act of 1940, as amended ("1940 Act"); and
WHEREAS, pursuant to an Advisory Agreement dated , 199_ (the
"Advisory Agreement") by and between the Trust and the Adviser, the Trust has
appointed the Adviser to furnish investment advisory and other services to the
Trust for its [ ] Funds and the Adviser has agreed thereto; and
WHEREAS, the Advisory Agreement authorizes the Adviser to subcontract
investment advisory services with respect to the Funds to the Sub-Adviser; and
WHEREAS, the Adviser desires to retain the Sub-Adviser to furnish
investment advisory services to the Trust with respect to the Small Cap Growth
Fund and the Sub-Adviser is willing to so furnish such services;
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, it is agreed between the parties hereto as follows:
1. APPOINTMENT AND DELIVERY OF DOCUMENTS.
(a) Intending to be legally bound, the Adviser, with the
approval of the Trust, hereby appoints the Sub-Adviser to
act as investment adviser to the Trust's Small Cap Growth
Fund (the "Fund") for the period and on the terms set forth
in this Agreement. Intending to be legally bound, the
Sub-Adviser accepts such appointment and agrees to furnish
the services herein set forth for the compensation herein
provided.
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(b) The Sub-Adviser acknowledges that it has received copies of
the Trust's most recent prospectuses and statements of
additional information with respect to the Fund. The Trust
will furnish the Sub-Adviser from time to time with copies
of all amendments of or supplements to the foregoing.
2. SERVICES OF SUB-ADVISER. The Sub-Adviser agrees that with respect to
each Fund it shall:
(a) Subject to the supervision of the Trust's Board of Trustees,
assist the Adviser in providing a continuous investment
program for each such Fund, including investment research
and management with respect to all securities, investments,
cash and cash equivalents in the Fund. The Sub-Adviser will
assist the Adviser in determining from time to time what
securities and other investments will be purchased, retained
or sold by such Fund. The Sub-Adviser will provide the
services rendered by it under this Agreement in accordance
with the Fund's investment objective, policies, and
restrictions as stated in the Trust's respective
Prospectuses and Statements of Additional Information for
the Fund and resolutions of the Trust's Board of Trustees.
(b) Place all orders for the purchase and sale of portfolio
securities for the account of the Fund with brokers or
dealers selected by the Sub-Adviser. In executing portfolio
transactions and selecting brokers or dealers, the
Sub-Adviser will use its best efforts to seek on behalf of
the Fund the best overall terms available. In assessing the
best overall terms available for any transaction the
Sub-Adviser shall consider all factors it deems relevant,
including the 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 the commission, if any, both for the specific transaction
and on a continuing basis. In evaluating the best overall
terms available, and in selecting the broker or dealer to
execute a particular transaction, the Sub-Adviser may also
consider the brokerage and research services (as those terms
are defined in Section 28(e) of the Securities Exchange Act
of 1934, as amended) provided to the Fund and/or other
accounts over which the Sub-Adviser or any affiliate of the
Sub-Adviser exercises investment discretion. The Sub-Adviser
is authorized,
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subject to the prior approval of the Board, to pay to a
broker or dealer who provides such brokerage and research
services a commission for executing a portfolio transaction
for the Fund 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 Sub-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 that
particular transaction or in terms of the overall
responsibilities of the Sub-Adviser to the Fund and to the
Trust.
(c) Maintain historical tax lots for each portfolio security
held by such Fund;
(d) Transmit trades to the Trust's custodian for proper
settlement;
(e) Prepare a quarterly broker security transaction summary and
monthly security transaction listing for the Fund;
(f) Maintain all books and records with respect to the Fund's
securities transactions effected by it; and
(g) Supply the Trust and its Board of Trustees with reports and
statistical data as reasonably requested.
3. OTHER COVENANTS. The Sub-Adviser agrees that it:
(a) will comply with all applicable Rules and Regulations of the
Securities and Exchange Commission and will in addition
conduct its activities under this Agreement in accordance
with other applicable law;
(b) will use the same skill and care in providing such services
as it uses in providing services to similar fiduciary
accounts for which it has investment responsibilities;
(c) will not make loans to any person to purchase or carry
shares in the Fund or make interest-bearing loans to the
Trust or the Fund;
(d) will maintain a policy and practice of conducting its
investment advisory services hereunder
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independently of the commercial banking operations of any
affiliated person of the Adviser. In making investment
recommendations for the Fund, the Sub-Adviser's personnel
will not inquire or take into consideration whether the
issuers (or related supporting institutions) of securities
proposed for purchase or sale for such Fund's account are
customers of the commercial department of any affiliated
person of the Adviser;
(e) will place orders pursuant to its investment determinations
for the Fund either directly with the issuer or with any
broker or dealer. In placing orders with brokers and
dealers, the Sub-Adviser will attempt to obtain the best
net price and the most favorable execution of its orders.
Consistent with this obligation, when the execution and
price offered by two or more brokers or dealers are
comparable, the Sub-Adviser may, in its discretion, purchase
and sell fund securities from and to brokers and dealers who
provide the Trust with research advice or other services. In
no instance, however, will securities be purchased from or
sold to the Adviser, any Sub-Adviser, the Trust's principal
underwriter or any affiliated person of either the Trust,
the Adviser, any Sub-Adviser, or the principal underwriter,
unless permitted by an order of the Securities and Exchange
Commission or applicable rules; and
(f) will treat confidentially and as proprietary information of
the Trust 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 performance of its responsibilities and duties
hereunder (except after prior notification to and approval
in writing by the Trust, which approval shall not be
unreasonably withheld and may not be withheld and will be
deemed granted where the Sub-Adviser may be exposed to civil
or criminal intent proceedings for failure to comply, when
requested to divulge such information by duly constituted
authorities or when so requested by the Trust).
4. SERVICES NOT EXCLUSIVE. The services furnished by the Sub-Adviser
hereunder are deemed not to be exclusive, and the Sub-Adviser shall be
free to furnish similar services to others so long as its services
under this Agreement are not impaired thereby. The Adviser acknowledges
that the Sub-Adviser may give advice and take action in the
performance
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of its duties with respect to any of its other clients which may differ
from advice given, or the time or nature of action taken, with respect
to the Fund.
5. BOOKS AND RECORDS. In compliance with the requirements of Rule 3la-3
under the 1940 Act, the Sub-Adviser hereby agrees that all records
which it maintains for each Fund are the property of the Trust and
further agrees to surrender promptly to the Trust any of such records
upon the Trust's written request. The Sub-Adviser further agrees to
preserve for the periods prescribed by Rule 3la-2 under the 1940 Act
the records required to be maintained by Rule 3la-1 under the 1940 Act.
6. EXPENSES. During the term of this Agreement, the Sub-Adviser will
pay all expenses incurred by it in connection with its activities under
this Agreement other than the cost of securities, commodities and other
investments (including brokerage commissions and other transaction
costs, if any) purchased or sold for any Fund.
7. COMPENSATION. For the services provided and the expenses assumed
pursuant to this Agreement, the Adviser will pay the Sub-Adviser and
the Sub-Adviser will accept as full compensation therefor a fee,
computed daily and payable monthly, at the rate of ._ % of the average
daily net assets of the Fund, minus such amount, if any, that the
Adviser has reimbursed the Trust in the event the aggregate expenses of
a Fund exceed the expense limitations of any state having jurisdiction
over the Fund.
8. LIMITATION OF LIABILITY. The Sub-Adviser shall not be liable for any
error of judgment or mistake of law or for any loss suffered by the
Trust 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
Sub-Adviser in the performance of its duties or from reckless disregard
by it of its obligations and duties under this Agreement.
9. DURATION AND TERMINATION. This Agreement will become effective as of
the date hereof and, unless sooner terminated as provided herein, shall
continue in effect until September 30, 1997. Thereafter, if not
terminated, this Agreement shall automatically continue in effect as to
a particular Fund for successive annual periods, 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 interested persons of
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any party to this Agreement, cast in person at a meeting called for the
purpose of voting on such approval, and (b) by the Trust's Board of
Trustees or by vote of a majority of the outstanding voting securities
of such Fund. Notwithstanding the foregoing, this Agreement may be
terminated as to any Fund at any time, without the payment of any
penalty, by the Adviser or 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) on sixty days' written notice to the
Sub-Adviser, or by the Sub-Adviser, on sixty days' written notice to
the Trust, provided that in each such case, notice shall be given
simultaneously to the Adviser. In addition, notwithstanding anything
herein to the contrary, in the event of the termination of the Advisory
Agreement with respect to a particular Fund for any reason (whether by
the Trust, by the Adviser or by operation of law) this Agreement shall
terminate with respect to the same Fund upon the effective date of such
termination of the Advisory Agreement. 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 meaning as such terms
have in the 1940 Act.)
10. 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. No amendment of
this Agreement shall be effective as to a particular Fund until
approved by vote of a majority of the outstanding voting securities of
such Fund.
11. MISCELLANEOUS. The Sub-Adviser expressly agrees that
notwithstanding the termination of or failure to continue this
Agreement with respect to a particular Fund, Sub-Adviser shall
continue to be legally bound to provide the services required herein
for any other Funds to which it is Sub-Adviser pursuant to this
Agreement for the period and on the terms set forth in this Agreement.
The captions in the 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 Delaware law.
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12. NAMES. The names "ARMADA FUNDS" and "Trustees of ARMADA FUNDS"
refer respectively to the Trust created and the Trustees, as trustees
but not individually or personally, acting from time to time under an
Declaration of Trust dated January 28, 1986 which is hereby referred to
and a copy of which is on file at the office of the State Secretary of
the Commonwealth of Massachusetts and the principal office of the
Trust. The obligations of "ARMADA FUNDS" entered into in the name or on
behalf thereof by any of the Trustees, representatives or agents are
made not individually, but in such capacities, and are not binding upon
any of the Trustees, shareholders or representatives of the Trust
personally, but bind only the Trust Property, and all persons dealing
with any class of shares of the Trust must look solely to the Trust
Property belonging to such class 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.
WELLINGTON MANAGEMENT COMPANY, LLP
BY:
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TITLE:
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NATIONAL CITY BANK
BY:
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TITLE:
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