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EXHIBIT 99.B (5)
INVESTMENT ADVISORY AGREEMENT
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INVESTMENT ADVISORY AGREEMENT
This Agreement is made as of January 20, 1995, between The Xxxxxxxx
Family of Funds, an Ohio business trust (the "Trust"), and Xxxxxxxx & Company,
Inc., an Ohio corporation (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 to furnish investment
advisory services to the newly created investment portfolios of the Trust and
may retain the Adviser to serve in such capacity to certain additional
investment portfolios of the Trust, all as now or hereafter may be identified in
Schedule A hereto (such initial investment portfolios and any such additional
investment portfolios together called the "Funds") and the Adviser represents
that it is willing and possesses legal authority to so furnish such services;
NOW, THEREFORE, in consideration of the mutual agreements and covenants
contained in this Agreement, the parties hereto agree as follows:
Section 1. Appointment. The Trust hereby appoints the Adviser to act as
investment adviser to the Funds for the period and on the terms and subject to
the conditions set forth in this Agreement. The Adviser accepts such appointment
and agrees to furnish the services herein set forth for the compensation herein
provided. Additional investment portfolios may from time to time be added to
those covered by this Agreement by the parties executing a new Schedule A which
shall become effective upon its execution and shall supersede any Schedule A
having an earlier date.
Section 2. Investment Advisory Services. Subject to the supervision of
the Trust's Board of Trustees, the Adviser shall provide a continuous investment
program for the Funds, including investment, research and management with
respect to all securities and investments and cash equivalents in the Funds. The
Adviser shall determine from time to time what securities and other investments
will be purchased, retained or sold by the Trust with respect to the Funds. The
Adviser shall provide the services under this Agreement in accordance with each
of the Fund's investment objectives, policies, and restrictions as stated in
such Fund's most current Prospectus and Statement of Additional Information, as
then in effect, and all amendments or supplements thereto, and resolutions of
the Trust's Board of Trustees as may be adopted from time to time. The Adviser
further agrees that it:
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(a) will use the same skill and care in providing such services as it
uses in providing services to any fiduciary accounts for which it has investment
responsibilities;
(b) will conform with all applicable Rules and Regulations of the
Securities and Exchange Commission (the "Commission") and, in addition, will
conduct its activities under this Agreement in accordance with any applicable
regulations of any governmental authority pertaining to the investment advisory
activities of the Adviser;
(c) 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 and is
hereby directed to obtain prompt execution of orders in an effective manner at
the most favorable price. Consistent with this obligation, the Adviser may, in
its discretion, purchase and sell portfolio securities to and from brokers and
dealers who provide the Adviser with brokerage and research services (within the
meaning of Section 28(e) of the Securities Exchange Act of 1934). Subject to the
review of the Trust's Board of Trustees from time-to-time with respect to the
extent and continuation of this policy, the Adviser is authorized to pay a
broker or dealer who provides such brokerage and research services a commission
for effecting a securities transaction for any of the Funds 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 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
either that particular transaction or the overall responsibilities of the
Adviser with respect to the accounts as to which it exercises investment
discretion. In no instance will portfolio securities be purchased from or sold
to Xxxxxxxx Research Corp., the Adviser, or any affiliated person of the Trust,
Xxxxxxxx Research Corp. or the Adviser unless otherwise permitted by the 1940
Act, an exemption therefrom, or an order thereunder;
(d) will maintain all books and records with respect to the securities
transactions of the Funds and will furnish the Trust's Board of Trustees such
periodic and special reports as the Board may request; and
(e) will advise and assist the officers of the Trust in taking such
actions as may be necessary or appropriate to carry out the decisions of the
Trust's Board of Trustees and of the appropriate committees of such Board
regarding the conduct of the business of the Funds; and
Section 3. Expenses. During the term of this Agreement, the Adviser
will pay all expenses incurred by it in connection with its activities, duties
and obligations under this Agreement, other than the costs of securities
(including brokerage fees, if any) purchased for the Funds.
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Section 4. Compensation. For the services provided and the expenses
assumed pursuant to this Agreement, each of the Funds will pay the Adviser and
the Adviser will accept as full compensation therefor a fee set forth on
Schedule A hereto. The obligations of the Funds to pay the above-described fee
to the Adviser will begin as of the respective dates of the initial public sale
of shares in the Funds, including any shares sold or exchanged in connection
with a merger, consolidation or reorganization involving one or more of the
Funds.
If in any fiscal year the aggregate expenses of any of the Funds (as
defined under the securities regulations of any state having jurisdiction over
the Trust) exceed the expense limitations of any such state, the Adviser will
reimburse such Fund for such excess expenses. The obligation of the Adviser to
reimburse the Funds hereunder is limited in any fiscal year to the amount of its
fee hereunder for such fiscal year; provided, however, that notwithstanding the
foregoing, the Adviser shall reimburse the Funds for such excess expenses
regardless of the amount of fees paid to it during such fiscal year to the
extent that the securities regulations of any state having jurisdiction over the
Trust so require. Such expense reimbursement, if any, will be estimated daily
and reconciled and paid on a monthly basis.
Section 5. 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 Funds in
connection with the performance of this Agree ment, 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 Adviser in the performance of its duties or from
reckless disregard by it of its obligations and duties under this Agreement.
Section 6. Duration and Termination. This Agreement will become
effective as of the date first written above (or, if a particular Fund is not in
existence on that date, on the date a registration statement relating to that
Fund becomes effective with the Commission), provided that it shall have been
approved by vote of a majority of the outstanding voting securities of such
Fund, in accordance with the requirements, if any, under the 1940 Act, and,
unless sooner terminated as provided herein, shall continue in effect until
January 20, 1997.
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Thereafter, if not terminated, this Agreement shall continue in effect
as to a particular Fund for successive periods of twelve months each ending on
January 20th of each year, provided such continu ance 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 parties to this Agreement or 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 vote of a majority of the Trust's
Board of Trustees or by the vote of a majority of all votes attributable to the
outstanding shares of such Fund. Notwithstanding the foregoing, this Agreement
may be terminated as to a particular Fund at any time on sixty days' written
notice, without the payment of any penalty, 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) or by the Adviser. 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 meanings as ascribed to such terms in the 1940 Act.)
Section 7. Name. The Trust hereby acknowledges that the name "Xxxxxxxx"
is a property right of the Adviser. The Adviser agrees that the Trust and the
Funds may, so long as this Agreement remains in effect, use "Xxxxxxxx" as part
of its name. The Adviser may permit other persons, firms or corporations,
including other investment companies, to use such name and may, upon termination
of this Agreement, require the Trust and the Funds to refrain from using the
name "Xxxxxxxx" in any form or combination in its name or in its business or in
the name of any of its Funds, and the Trust shall, as soon as practicable
following its receipt of any such request from the Adviser, so refrain from
using such name.
Section 8. Adviser's Representations. The Adviser hereby represents and
warrants that it is willing and possesses all requisite legal authority to
provide the services contemplated by this Agreement without violation of
applicable laws and regulations.
Section 9. 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.
Section 10. Miscellaneous. 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 con struction 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 the laws of the State of Ohio.
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The Xxxxxxxx Family of Funds is a business trust organized under
Chapter 1746, Ohio Revised Code and under a Declaration of Trust, to which
reference is hereby made and a copy of which is on file at the office of the
Secretary of State of Ohio as required by law, and to any and all amendments
thereto so filed or hereafter filed. The obligations of "The Xxxxxxxx Family of
Funds" entered into in the name or on behalf thereof by any of the Trustees,
officers, employees or agents are made not individually, but in such capacities,
and are not binding upon any of the Trustees, officers, employees, agents or
shareholders of the Trust personally, but bind only the assets of the Trust, as
set forth in Section 1746.13(A), Ohio Revised Code, and all persons dealing with
any of the Funds of the Trust must look solely to the assets of the Trust
belonging to such Fund 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.
THE XXXXXXXX FAMILY OF FUNDS
By: /s/ Xxxxx X. Xxxxxxxx
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Name: Xxxxx X. Xxxxxxxx
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Title: President
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XXXXXXXX & COMPANY, INC.
By: /s/ Xxxxxx X. Xxxxxxxx
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Name: Xxxxxx X. Xxxxxxxx
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Title: Sr. Exec. V.P.
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Dated as of: January 20, 1995
Amended as of: Xxxxx 0, 0000
XXXXXXXX "A"
Investment Advisory Agreement
between
FAIRPORT FUNDS
and
XXXXXXXX & COMPANY, INC.
Name of Fund Compensation*
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Fairport Midwest Growth Fund Annual rate of seventy-five one hundredths
of one percent (0.75%) of the average daily
net assets of such Fund up to $100 Million
and fifty one-hundredths of one percent
(0.50%) of the average daily net assets of such
Fund of $100 Million or more.
Fairport Growth and Income Fund Annual rate of seventy-five one hundredths
of one percent (0.75%) of the average daily
net assets of such Fund up to $100 Million
and fifty one-hundredths of one percent
(0.50%) of the average daily net assets of such
Fund of $100 Million or more.
Fairport Government Securities Fund Annual rate of twenty-five one-hundredths
of one percent (.25%) of the average daily net
assets of such Fund up to $100 Million and
one hundred twenty-five one thousandths of
one percent (0.125%) of the average daily net
assets of such Fund of $100 Million or more.
XXXXXXXX & COMPANY, INC. THE XXXXXXXX FAMILY OF FUNDS
By: /s/ Xxxxxx X. Xxxxxxxx By: /s/ Xxxxx X. Xxxxxxxx
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Name: Xxxxxx X. Xxxxxxxx Name: Xxxxx X. Xxxxxxxx
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Title: Sr. Exec. V.P. Title: President
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* All fees are computed and paid monthly.
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