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EXHIBIT 5(k)
FORM
ARMADA FUNDS
SMALL CAP GROWTH FUND
REAL RETURN ADVANTAGE FUND
ADVISORY AGREEMENT
AGREEMENT made as of , 1997 between ARMADA FUNDS, a
Massachusetts business trust, located in Wayne, Pennsylvania (the "Trust") and
NATIONAL CITY BANK, located in Cleveland, Ohio (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 retain the Adviser as investment adviser
to the Small Cap Growth and Real Return Advantage Funds (individually,
a "Fund" and collectively, the "Funds");
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, it is agreed among the parties hereto as follows:
1. DELIVERY OF DOCUMENTS. The Adviser acknowledges that it has
received copies of each of the following:
(a) The Trust's Declaration of Trust, as filed with the
State Secretary of the Commonwealth of Massachusetts
on January 29, 1986, and all amendments thereto (such
Declaration of Trust, as presently in effect and as
it shall from time to time be amended, is herein
called the "Declaration of Trust");
(b) The Trust's Code of Regulations and amendments
thereto (such Code of Regulations, as presently in
effect and as it shall from time to time be amended,
is herein called the "Code of Regulations");
(c) Resolutions of the Trust's Board of Trustees
authorizing the appointment of the Adviser and
approving this Agreement;
(d) The Trust's Notification of Registration on Form N-8A
under the 1940 Act as filed with the Securities and
Exchange Commission ("SEC") on September 26, 1985 and
all amendments thereto;
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(e) The Trust's Registration Statement on Form N-1A under
the Securities Act of 1933, as amended ("1933 Act")
(File No. 33-488) and under the 1940 Act, as filed
with the SEC on September 26, 1985 and all amendments
thereto; and
(f) The Trust's most recent prospectuses and statements
of additional information with respect to the Funds
(such prospectuses and statements of additional
information, as presently in effect, and all
amendments and supplements thereto, are herein called
individually, a "Prospectus", and collectively, the
"Prospectuses").
The Trust will furnish the Adviser from time to time with
execution copies of all amendments of or supplements to the foregoing.
2. SERVICES. The Trust hereby appoints the Adviser to act as investment
adviser to the Funds for the period and on the terms set forth in this
Agreement. Intending to be legally bound, the Adviser accepts such
appointment and agrees to furnish the services required herein to the
Funds for the compensation hereinafter provided.
Subject to the supervision of the Trust's Board of Trustees,
the Adviser will provide a continuous investment program for each Fund,
including investment research and management with respect to all
securities and investments and cash equivalents in each Fund. The
Adviser will determine from time to time what securities and other
investments will be purchased, retained or sold by each Fund. The
Adviser will provide the services under this Agreement in accordance
with each Fund's investment objective, policies, and restrictions as
stated in the Prospectus and resolutions of the Trust's Board of
Trustees applicable to such Fund.
3. COVENANTS BY ADVISER. The Adviser agrees with respect to the
services provided to each Fund that it:
(a) will comply with all applicable Rules and Regulations
of the SEC 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 Funds, or make interest-
bearing loans to the Trust or the Funds;
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(d) will maintain a policy and practice of conducting its
investment management activities independently of the
Commercial Departments of all banking affiliates. In
making investment recommendations for the Funds,
personnel will not inquire or take into consideration
whether the issuers (or related supporting
institutions) of securities proposed for purchase or
sale for the Funds' accounts are customers of the
Commercial Department. In dealing with commercial
customers, the Commercial Department will not inquire
or take into consideration whether securities of
those customers are held by the Funds;
(e) 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 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
Adviser may, in its discretion, purchase and sell
fund securities from and to brokers and dealers who
provide the Trust with research advice and other
services. In no instance will fund securities be
purchased from or sold to the Adviser, SEI Financial
Services Company ("SEI") or an affiliated person of
either the Trust, the Adviser, or SEI unless
permitted by an order of the SEC or applicable rules;
(f) will maintain all books and records with respect to
the securities transactions for the Funds and furnish
the Trust's Board of Trustees such periodic and
special reports as the Board may request; and
(g) will treat confidentially and as proprietary
information of the Trust all records and other
information relative to the Funds 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 Adviser
may be exposed to civil or criminal contempt
proceedings for failure to comply, when requested to
divulge such information
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by duly constituted authorities, or when so requested
by the Trust).
4. SERVICES NOT EXCLUSIVE. The services furnished by the Adviser
hereunder are deemed not to be exclusive, and the Adviser shall be free
to furnish similar services to others so long as its services under
this Agreement are not impaired thereby.
5. BOOKS AND RECORDS. In compliance with the requirements of Rule 31a-3
under the 1940 Act, the Adviser hereby agrees that all records which it
maintains for the Trust are the property of the Trust and further
agrees to surrender promptly to the Trust any of such records upon the
Trust's request. The Adviser further agrees to preserve for the periods
prescribed by Rule 31a-2 under the 1940 Act the records required to be
maintained by Rule 31a-1 under the 1940 Act.
6. EXPENSES. 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 (including brokerage
commissions, if any) purchased for the Funds.
7. COMPENSATION. For the services provided and the expenses assumed
pursuant to this Agreement, the Trust will pay the Adviser from the
assets belonging to the Funds and the Adviser will accept as full
compensation therefor fees, computed daily and paid monthly, at the
following annual rates: % of the average daily net assets of the
Small Cap Growth Fund; and % of the average daily net assets of the
Real Return Advantage Fund.
The fee attributable to each Fund shall be the several (and
not joint or joint and several) obligation of each Fund.
If in any fiscal year the aggregate expenses of a Fund (as
defined under the securities regulations of any state having
jurisdiction over the Fund) exceed the expense limitations of any such
state, the Adviser will reimburse the Trust for such excess expenses to
the extent described in any written undertaking provided by the Adviser
to such state.
8. 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
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
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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.
9. DURATION AND TERMINATION. This Agreement will become effective with
respect to each Fund upon approval of this Agreement by vote of a
majority of the outstanding voting securities of such Fund, and, unless
sooner terminated as provided herein, shall continue in effect until
September 30, 1997. Thereafter, if not terminated, this Agreement shall
continue in effect with respect to a particular Fund for successive
twelve month periods ending on September 30, 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 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 the Fund. Notwithstanding the
foregoing, this Agreement may be terminated as to any Fund at any time,
without the payment of any penalty, by the Trust (by the Trust's Board
of Trustees or by vote of a majority of the outstanding voting
securities of the particular Fund), or by the Adviser on 60 days'
written notice. 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 of such terms 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 with respect to a Fund until approved
by vote of a majority of the outstanding voting securities of that
Fund.
11. MISCELLANEOUS. The Adviser expressly agrees that notwithstanding
the termination of or failure to continue this Agreement with respect
to a particular Fund, the Adviser shall continue to be legally bound to
provide the services required herein for the other Fund for the period
and on the terms set forth in this Agreement. 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.
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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.
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 a
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.
ARMADA FUNDS
By:____________________________
Title:
NATIONAL CITY BANK
By:____________________________
Title:
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