INVESTMENT ADVISORY AGREEMENT
This Investment Advisory and Management Agreement ("Agreement"), is made
and entered into this 17th day of July , 1998 by and between Upright
Investments, a Delaware business trust (the "Fund"), and Upright Financial
Corporation, a New Jersey company (the "Adviser").
WHEREAS, the Fund is registered as an open-end, diversified investment
company under the Investment Company Act of 1940 (the "1940 Act") and has
registered its shares of common stock for sale to the public under the
Securities Act of 1933 and various state securities laws; and
WHEREAS, the Fund wishes to retain the Adviser to provide investment
advisory and portfolio management services to the Fund; and WHEREAS, the Adviser
is willing to furnish such services on the terms and conditions hereinafter set
forth.
NOW THEREFORE , in consideration of the promises and mutual covenants
herein contained, and intending to be legally bound, the Fund and the Adviser
agree as follows:
1. Appointment. The Fund hereby appoints the Adviser to manage the
investment and reinvestment of assets of the Upright Growth Fund and any other
portfolio of the Fund which may be hereafter designated as a separate series 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. Duties of the Advisor. Subject to supervision by the Board, the
Advisor shall, during the term and subject to the provisions of this Agreement,
(i) determine the composition of the Fund's portfolio, the nature and timing of
the changes herein and the manner of implementing such changes and (ii) provide
the Fund with such investment advisory, research and related services as the
Fund may, from time to time, reasonably require for the investment of its funds.
The Advisor shall perform such duties in accordance with (a) applicable laws and
regulations, including, but not limited to, the 1940 Act, (b) the terms of this
Agreement, (c) the Trust's Declaration of Trust, By-Laws and currently effective
registration statement under the Securities Act of 1933, as amended, and the
1940 Act, and any amendments thereto, (d) relevant undertakings to state
securities regulators which also have been provided to the Manager, (e) the
stated investment objective(s), policies and restrictions of each applicable
Series, and (f) such other guidelines as the Fund's Board of Trustees ("Board")
reasonably may establish.
3. Services Not Exclusive. The services furnished by the Advisor
hereunder are not to be deemed exclusive and the Advisor shall be free to
furnish similar services to other so long as its services under this Agreement
are not impaired thereby. Nothing in this Agreement shall limit or restrict the
right of any director, officer or employee of the Advisor, who may also be a
Trustee, officer or employee of the Fund, to engage in any other business or to
devote his or her time and attention in part to the management or other aspects
of any other business, whether of a similar nature or a dissimilar nature.
4. Expenses Payable by the Fund. Except as otherwise provided in
Paragraphs 2 and 5 hereof, the Fund shall be responsible for effecting sales and
redemption of its shares, for determining the net asset value thereof and for
all of its other operations and shall pay all administrative and other costs and
expenses attributable to its operations and transactions, including, without
limitation, organization expenses; voluntary assessments and other expenses
incurred connection with membership in investment company organizations;
transfer agent and custodian fees; legal, administrative and clerical services;
auditing; preparation, printing and distribution of its prospectuses, proxy
statements, stockholders reports and notices; cost of supplies and postage;
Federal and state registration fees; Federal, state and local taxes;
non-affiliated directors fees; interest on its bank loans; brokerage commissions
and prompting the sale of its shares, including advertising, compensation of
sales personnel.
5. Expenses Payable by the Advisor. The Advisor is responsible for (1)
the compensation of any of the Fund's trustees, officers and employees who are
interested persons of the Advisor, (2) compensation of the Advisor's personnel
and other expenses in connection with the provisions of portfolio management
services under this Agreement. Other than as herein specifically indicated, the
Advisor shall not be responsible for the Fund's expenses. Specifically, the
Advisor will not be responsible, except to the extent of the reasonable
compensation of employees of the Fund whose services may be used by the Advisor.
No trustee, officer or employee of the Fund shall receive from the Fund
any salary or other compensation as such trustee, officer or employee while he
is at the same time a director, officer or employee of the Advisor or any
affiliated company of the Advisor. This paragraph shall not apply to trustees,
executive committee members, consultants and other persons who are not regular
members of the Advisor's or any affiliated company's staff.
6. Compensation. As compensation for the services performed by the
Advisor, the Fund shall pay the Advisor, as promptly as possible after the last
day of each month, a fee, accrued each calendar day (including weekends and
holidays) at the rate of 1.5% per annum of the daily net assets of the Fund. The
Advisor shall reduce such fee, if the expenses borne by Fund in any fiscal year
exceed the applicable expense limitations imposed by the securities regulations
of any state in which shares are registered or qualified for sale to the public,
the Advisor will waive its fee or reimburse Fund for any excess up to the amount
of the fee payable to it during that fiscal year.
7. Limitation of Liability of the Advisor. The Advisor shall not be
liable for any error of judgment or mistake of law or for any loss suffered by
the Fund or any Series in connection with the matters to which this Agreement
relate except a loss resulting from the willful misfeasance, bad faith or gross
negligence on its part in the performance of its duties or from reckless
disregard by it of its obligations and duties under this Agreement. The Fund
shall indemnify the Advisor and hold it harmless from and against all damages,
liabilities, costs and expenses (including reasonable attorneys' fees and
amounts reasonably paid in settlement) incurred by the Advisor in or by reason
of any pending, threatened or completed action, suit, investigation or other
proceeding (including an action or suit by or in the right of the Fund or its
security holders) arising out of or otherwise based upon any action actually or
allegedly taken or omitted to be taken by the Advisor in connection with the
performance of any of its duties or obligations under this Agreement or
otherwise as an investment adviser of the Fund.
8. Responsibility of Dual Directors, Officers and/or Employees. If any
person who is a director, officer or employee of the Advisor is or becomes a
director, officer and/or employee of the Fund and acts as such in any business
of the Fund pursuant to this Agreement, then such director, officer and/or
employee of the Advisor shall be deemed to be acting in such capacity solely for
the Fund, and not as a director, officer or employee of the Advisor or under the
control or direction of the Advisor, although paid by the Advisor.
9. Execution of Transactions. In the selection of brokers or dealers
and the placement of orders for the purchase and sale of portfolio investments
for the Fund, the Advisor shall use its best efforts to obtain for the Fund the
most favorable price and execution available, except to the extent that it may
be permitted to pay higher brokerage commissions for brokerage or research
services. In doing so, the Advisor may consider such factors which it deems
relevant to the Fund's best interest, such as price, the size of the
transaction, the nature of the market for the security, the amount of the
commission, the timing of the transaction, the reputation, experience and
financial stability of the broker-dealer involved and the quality of service
rendered by the broker-dealer in other transactions. Subject to such policies as
the Board may determine, the Advisor shall not be deemed to have acted
unlawfully or to have breached any duty created by this Agreement or otherwise
solely by reason of its having caused a Fund to pay a broker that provides
brokerage or research services to the Advisor an amount of commission for
effecting a portfolio investment transaction in excess of the amount of
commission another broker would have charged for effecting that transaction if
the Advisor determines in good faith that such amount of commission is
reasonable in relation to the value of the brokerage or research services
provided by such broker or dealer, viewed in terms of either that particular
transaction or the Advisor 's overall responsibilities with respect to the Fund
and to other clients of the Advisor as to which the Advisor exercises investment
discretion.
10. Duration and termination. This Agreement will remain in effect for
two years from the date of its execution and from year to year thereafter so
long as specifically approved annually, (1) by vote of a majority of the
trustees of the Fund who are not parties to this Agreement or interested persons
of such parties, cast in person at a meeting called for that purpose, and (2)
either by vote of the holders of a majority of the outstanding voting securities
of the Fund or by a majority vote of the Fund's Board of Trustees.
This Agreement shall terminate automatically in the event of its
assignment by the Advisor and shall not be assignable by the Fund without the
consent of the Advisor. This Agreement may also be terminated at any time,
without the payment of penalty, by the Fund or by the Advisor on sixty (60)
days' written notice addressed to the other party at its principal place of
business.
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, and no material amendment of this Agreement
shall be effective until approved by vote of the holders of a majority of the
outstanding voting securities of such Series.
11. Name of Company. The Fund may use the name "Upright Investments"
only for so long as this Agreement or any extension, renewal or amendment hereof
remains in effect, including any similar agreement with any organization which
shall have succeeded to the business of the Advisor. At such time as such an
agreement shall no longer be in effect, the Fund will (to the extent that it
lawfully can) cease to use any name derived from Upright Financial Corp. or any
successor.
12. Definitions. As used in this Agreement, the terms "majority of the
outstanding voting securities," "interested person, " and "assignment "shall
have the same meanings as such terms have in the 1940 Act.
13. Severability. 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.
14. Miscellaneous. The captions in this Agreement are included for
convenience of reference only an din no way define or delimit nay of the
provisions hereof or otherwise affect their construction or effect.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
Attest: Upright Growth Fund
/s/ Chaur Xxx Xxx BY /s/ Xxxxx Y.S. Chiueh
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Vice President of the Fund President
Upright Financial Corporation
Attest:
/s/ Chaur Xxx Xxx BY /s/ Xxxxx Y.S. Chiueh
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Vice President of the Fund President
