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EX-99.B5(a)
SBSF FUNDS, INC.
INVESTMENT ADVISORY AGREEMENT
Agreement, made this 5th day of April, 1995 between SBSF Funds, Inc., a
Maryland corporation (the "Fund"), and SPEARS, BENZAK, SALOMON & XXXXXXX, INC.,
a New York corporation (the "Adviser").
WHEREAS, the Fund is an open-end diversified investment company
registered under the Investment Company Act of 1940, as amended (the "1940 Act")
and is authorized to issue its shares in series; and
WHEREAS, the Fund desires to retain the Adviser to render investment
advisory services to the Fund, and the Adviser is willing to render such
services;
WITNESSETH:
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that in consideration of the premises and mutual promises hereinafter set forth,
the parties hereto agree as follows:
1. The Fund hereby appoints the Adviser to act as investment adviser to
the Fund for the period and on the terms set forth in this Agreement. The
Adviser accepts such appointment and agrees to render the services herein set
forth, for the compensation herein provided.
2. Subject to the general supervision of the Board of Directors of the
Fund, the Adviser shall manage the investment operations of the Fund and the
composition of each of the Fund's portfolios of securities and investments,
including cash, the purchase, retention and disposition thereof and agreements
relating thereto, in accordance with the Fund's investment objectives and
policies as stated in the Prospectus (as defined in paragraph 3 of this
Agreement) and subject to the following understandings:
(a) the Adviser shall furnish a continuous investment program
for the Fund's portfolios and determine from time to time what
investments or securities will be purchased, retained, sold or lent by
the Fund, and what portions of the assets will be invested in
securities, cash and cash equivalents;
(b) the Adviser shall use the same skill and care in the
management of the Fund's portfolios as its uses in the administration
of other accounts for which it has investment responsibility as agent;
(c) the Adviser, in the performance of its duties and
obligations under this Agreement, shall act in conformity with the
Articles of Incorporation, By-Laws and Prospectus of the Fund and with
the instructions and directions of the
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Board of Directors of the Fund and will confirm to and comply with the
requirements of the 1940 Act and all other applicable federal and
state laws and regulations; and
(d) the Adviser shall determine the securities to be
purchased, sold or lent by the Fund and as agent for the Fund will
effect portfolio transactions pursuant to its determinations either
directly with the issuer or with any broker and/or dealer in such
securities; in placing orders with brokers and/or dealers the Adviser
intends to seek best price and execution for the purchases and sales
and in accordance with the policies of each of the Fund's portfolios
with respect to allocation of brokerage set forth from time to time in
the Fund's Prospectus and as may be otherwise determined by the Board
of Directors; the Adviser shall also make recommendations regarding
whether or not the Fund shall enter into repurchase agreements with
respect to the Fund's portfolios.
On occasions when the Adviser deems the purchase or sale of a security
to be in the best interest of the Fund as well as other customers, the Adviser
may, to the extent permitted by applicable laws and regulations, but shall not
be obligated to, aggregate the securities to be sold or purchased in order to
obtain the best execution and lower brokerage commissions, if any. In such
event, allocation of the securities so purchased or sold, as well as the
expenses incurred in the transaction, will be made by the Adviser in the manner
it considers to be the most equitable and consistent with its fiduciary
obligations to the Fund and to such other customers.
(e) the Adviser shall maintain books and records with respect
to the Fund's securities transactions and shall render to the Board of
Directors of the Fund such periodic and special reports as the Board of
Directors may reasonably request; and
(f) the investment management services of the Adviser to the
Fund's portfolios under this Agreement are not to be deemed exclusive,
and the Adviser shall be free to render similar services to others.
3. The Fund has delivered copies of each of the following documents to
the Adviser and will promptly notify and deliver to it all future amendments and
supplements, if any:
(a) Articles of Incorporation of the Fund, filed with the
Secretary of State of the State of Maryland on May 26, 1983 (such
Articles of Incorporation, as presently in effect and as amended from
time to time, are herein called the "Articles of Incorporation");
(b) By-Laws of the Fund (such By-Laws, as presently in effect
and as amended from time to time, are herein called the "By-Laws");
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(c) Certified resolutions of the Board of Directors of the
Fund authorizing the appointment of the Adviser and approving the form
of this Agreement;
(d) Registration Statement under the 1940 Act and the
Securities Act of 1933, as amended, on Form N-1 (No. 2-84920) (the
"Registration Statement") as filed with the Securities and Exchange
Commission (the "Commission") on July 5, 1983 relating to the Fund and
the shares of the Fund's common stock, par value $.01, and all
amendments and post-effective amendments thereto; and
(e) Notification of Registration of the Fund under the 1940
Act on Form N-8A as filed with the Commission on July 5, 1983.
4. Pursuant to applicable law, the Adviser shall keep the Fund's books
and records required to be maintained by, or on behalf of, the Fund with respect
to the advisory services hereunder. The Adviser agrees that all records which it
maintains for the Fund are the property of the Fund and it will promptly
surrender any of such records to the Fund upon the Fund's request. The Adviser
further agrees to preserve for the periods prescribed by Rule 31a-2 of the
Commission under the 1940 Act any such records of the Fund required to be
preserved by Rule 31a-1 of the Commission under the 1940 Act.
5. During the term of this Agreement, the Adviser will pay all expenses
incurred by it in connection with its activities under this Agreement other than
the cost of securities and investments purchased for the Fund (including taxes
and brokerage commissions, if any).
6. For the services provided and the expenses borne pursuant to this
Agreement, each of the Fund's portfolios will pay to the Adviser as full
compensation therefor a fee at an annual rate as follows: 75% of the average
daily net assets of the SBSF Fund, the Convertible Securities Fund and the
Capital Growth Fund and .25% of the average daily net assets of the Money Market
Fund. This fee will be computed daily and will be paid to the Adviser monthly.
In the event the expenses of any of the Fund's portfolios for any fiscal year
(including the fees payable to the Adviser for administration, if any, and
amortization expense, but excluding interest, taxes, brokerage commissions and
litigation and indemnification expenses and other extraordinary expenses not
incurred in the ordinary course of the Fund's business) exceed the lowest
applicable annual expense limitation established pursuant to the statutes or
regulations of any jurisdictions in which shares of the Fund's portfolios are
then qualified for offer and sale, the compensation due to the Adviser
thereunder will be reduced by the amount of such excess, or if such excess
expenses exceed the amount of the fees payable to the Adviser, the Adviser shall
reimburse the affected portfolio or portfolios of the Fund the amount by which
such expenses exceed such fees. Any reduction in the fee payable and any payment
by the Adviser to the Fund shall be made monthly and subject to readjustment
during the year.
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7. The Adviser 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 (in which case any
award damages shall be limited to the period and the amount set forth in Section
36(b)(3) of the 0000 Xxx) or a loss resulting from willful misfeasance, bad
faith or gross negligence on its part in the performance of its duties or from
reckless disregard by it or its obligations and duties under this Agreement.
8. This Agreement shall continue in effect for a period of more than
one year from the date hereof only so long as such continuance is specifically
approved at least annually in conformity with the requirements of the 1940 Act
as in effect at such time; provided, however, that this Agreement may be
terminated by the Fund at any time, without the payment of any penalty, by vote
of a majority of the directors of the Fund who are not parties to such contract
or interested persons of the Fund (as defined in the 0000 Xxx) or by vote of a
majority of the outstanding voting securities of the Fund on 60 days' written
notice to the Adviser, or by the Adviser at any time, without the payment of any
penalty, on 90 days' written notice to the Fund. This Agreement will
automatically and immediately terminate in the event of its assignment (as
defined in the 1940 Act).
9. The Adviser shall for all purposes herein be deemed to be an
independent contractor and shall, unless otherwise expressly provided herein or
authorized by the Board of Directors of the Fund from time to time, have no
authority to act for or represent the Fund in any way or otherwise be deemed an
agent of the Fund.
10. This Agreement may be amended with respect to a portfolio or
portfolios by mutual consent, but the consent of the Fund must be approved (a)
by vote of a majority of those directors of the Fund who are not parties to this
Agreement or interested persons of any such party or have any direct or indirect
financial interest in this Agreement, cast in person at a meeting called for the
purpose of voting on such amendment, and (b) by vote of a majority of the
outstanding voting securities of the affected portfolio or portfolios of the
Fund.
11. Notice of any kind to be given to the Adviser by the Fund shall be
in writing and shall be duly given if mailed or delivered to the Adviser at 00
Xxxxxxxxxxx Xxxxx, Xxx Xxxx 00000, Attention: President, or at such other
address or to such other individual as shall be specified by the Adviser to the
Fund. Notices of any kind to be given to the Fund by the Adviser shall be in
writing and shall be duly given if mailed or delivered to the Fund at 000 Xxxx
00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Secretary or at such other
address or to such other individual as shall be specified by the Fund to the
Adviser.
12. This Agreement may be executed in one or more counterparts, each of
which shall be deemed to be an original.
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IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be executed by their officers designated below on the day and year first above
written.
SBSF FUNDS, INC.
By: /s/ Xxxxxxx X. Xxxxxxx
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ATTEST:
By:
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Assistant Secretary
SPEARS, BENZAK, SALOMON &
XXXXXXX, INC.
By: /s/ Xxxxxxxxxxx X. Xxxxx
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ATTEST:
By: /s/ Xxxxxxx X. Xxxxxx
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Secretary
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