Exhibit 5(i) under Form N-1A
Exhibit 10 under Item 601/Reg. S-K
BAYFUNDS
INVESTMENT ADVISORY CONTRACT
This Contract is made this 1ST DAY OF SEPTEMBER, 1992, between BAYBANKS
INVESTMENT MANAGEMENT, INC., an investment adviser registered under the
Investment Advisers Act of 1940, having its principal place of business in
Cambridge, Massachusetts (the "Adviser"), and BAYFUNDS, a Massachusetts
business trust having its principal place of business in Pittsburgh,
Pennsylvania (the "Trust").
WHEREAS, the Trust is an "open-end company" as that term is defined in
the Investment Company Act of 1940 (the "Act") and is registered as such
with the Securities and Exchange Commission; and
WHEREAS, the Adviser is engaged in the business of rendering investment
advisory and management services.
NOW, THEREFORE, the parties hereto, intending to be legally bound, agree
as follows:
1. The Trust hereby appoints Adviser as Investment Adviser for each of
the portfolios ("Funds") of the Trust on whose behalf the Trust executes an
exhibit to this Contract, and Adviser, by its execution of each such exhibit,
accepts the appointments. Subject to the direction of the Trustees of the
Trust, Adviser shall provide investment research and supervision of the
investments of each of the Funds and conduct a continuous program of
investment evaluation and of appropriate sale or other disposition and
reinvestment of each Fund's assets. The Adviser shall determine the
securities to be purchased or sold by the Fund and will place orders pursuant
to its determinations with or through such brokers or dealers in conformity
with such policies with respect to brokerage as the Trust shall establish from
time to time and convey to the Adviser.
2. Adviser, in its supervision of the investments of each of the Funds
will be guided by each Fund's fundamental investment policies and the
provisions and restrictions contained in the Declaration of Trust and By-Laws
of the Trust and as set forth in the Trust's Registration Statement (as
hereinafter defined) and exhibits thereto as may be on file with the
Securities and Exchange Commission. The Trust shall deliver copies of all
such investment policies and of the Declaration of Trust and By-Laws of the
Trust, as amended from time to time, and the Registration Statements to the
Adviser, promptly upon such documents becoming available.
3. The Trust shall pay or cause to be paid, on behalf of each Fund, all
of the Funds' expenses and the Funds' allocable share of Trust expenses,
including without limitation, the expenses of organizing the Trust and
continuing its existence; fees and expenses of officers and Trustees of the
Trust; fees for investment advisory services and administrative personnel and
services; fees and expenses of preparing and filing its Registration
Statements under the Securities Act of 1933 and the Act and any amendments
thereto (collectively, the "Registration Statements"); expenses of registering
and qualifying the Trust, the Funds and shares of the Funds ("Shares") under
Federal and state laws and regulations; expenses of preparing, printing and
distributing prospectuses (and any amendments thereto) and sales literature;
interest expense, taxes, fees and commissions of every kind; expenses of issue
(including cost of Share certificates), purchase, repurchase and redemption of
Shares, including expenses attributable to a program of periodic issue;
charges and expenses of custodians, transfer agents, dividend disbursing
agents, shareholder servicing agents and registrars; printing and mailing
costs, auditing, accounting and legal expenses; reports to shareholders and
governmental officers and commissions; expenses of meetings of Trustees and
shareholders and proxy solicitations therefor; insurance expenses; association
membership dues; and such nonrecurring items as may arise, including all
losses and liabilities incurred in administering the Trust and the Funds. The
Trust will also pay each Fund's allocable share of such extraordinary expenses
as may arise, including expenses incurred in connection with litigation,
proceedings, and claims and the legal obligations of the Trust to indemnify
its officers, Trustees, employees, distributors, and agents with respect
thereto.
4. The Trust, on behalf of each of the Funds, shall pay to Adviser, for
all services rendered to such Fund by Adviser hereunder, the fees set forth in
the exhibits attached hereto.
5. The net asset value of each Fund's Shares as used herein will be
calculated to the nearest 1/10th of one cent.
6. The Adviser may from time to time and for such periods as it deems
appropriate reduce its compensation (and, if appropriate, assume expenses of
one or more of the Funds) to the extent that any Fund's expenses exceed such
lower expense limitation as the Adviser may, by notice to the Fund,
voluntarily declare to be effective.
7. This Contract shall begin for each Fund as of the date of execution
of the applicable exhibit and shall continue in effect with respect to each
Fund presently set forth on an exhibit (and any subsequent Funds added
pursuant to an exhibit during the initial term of this Contract) for two years
from the date of this Contract set forth above and thereafter for successive
periods of one year, subject to the provisions for termination and all of the
other terms and conditions hereof if: (a) such continuation shall be
specifically approved at least annually by the vote of a majority of the
Trustees of the Trust, including a majority of the Trustees who are not
parties to this Contract or interested persons of any such party (other than
as Trustees of the Trust), cast in person at a meeting called for that
purpose; and (b) Adviser shall not have notified a Fund in writing at least
sixty (60) days prior to the anniversary date of this Contract in any year
thereafter that it does not desire such continuation with respect to that
Fund. If a Fund is added after the first approval by the Trustees as
described above, this Contract will be effective as to that Fund upon
execution of the applicable exhibit and will continue in effect until the next
annual approval of this Contract by the Trustees and thereafter for successive
periods of one year, subject to approval as described above.
8. Notwithstanding any provision in this Contract, it may be terminated
at any time with respect to any Fund, without the payment of any penalty, by
the Trustees of the Trust or by a vote of a majority of the outstanding voting
securities of that Fund, as defined in Section 2(a)(42) of the Act on sixty
(60) days' written notice to Adviser.
9. This Contract may not be assigned by Adviser and shall automatically
terminate in the event of any assignment. For purposes of this Contract,
"assignment" shall have the meaning assigned to that term in Section 2(a)(4)
of the Act. Adviser may employ or contract with such other person, persons,
corporation or corporations at its own cost and expense as it shall determine
in order to assist it in carrying out this Contract.
10. In the absence of willful misfeasance, bad faith, gross negligence
or reckless disregard of obligations or duties under this Contract on the part
of Adviser, Adviser shall not be liable to the Trust or to any of the Funds or
to any shareholder for any act or omission in the course of or connected in
any way with rendering services or for any losses that may be sustained in the
purchase, holding or sale of any security.
11. This Contract may be amended at any time by agreement of the parties
provided that the amendment shall be approved by the vote of a majority of the
Trustees of the Trust, including a majority of Trustees who are not parties to
this Contract or interested persons of any such party to this Contract (other
than as Trustees of the Trust), cast in person at a meeting called for that
purpose, and, where required by Section 15(a)(2) of the Act, on behalf of a
Fund by a majority of the outstanding voting securities of such Fund as
defined in Section 2(a)(42) of the Act.
12. The Adviser acknowledges that all sales literature for investment
companies (such as the Trust) are subject to strict regulatory oversight. The
Trust agrees to cause its distributor to promptly review all such sales
literature to ensure compliance with relevant requirements, to promptly advise
Adviser of any deficiencies contained in such sales literature, to promptly
file complying sales literature with the relevant authorities, and to cause
such sales literature to be distributed to prospective investors in the Trust.
13. Adviser is hereby expressly put on notice of the limitation of
liability as set forth in Article XI of the Declaration of Trust and agrees
that the obligations pursuant to this Contract of a particular Fund and of the
Trust with respect to that particular Fund be limited solely to the assets of
that particular Fund, and Adviser shall not seek satisfaction of any such
obligation from the assets of any other Fund, the shareholders of any Fund,
the Trustees, officers, employees or agents of the Trust, or any of them.
14. This Contract shall be construed in accordance with and governed by
the laws of the Commonwealth of Pennsylvania, provided, however, that nothing
herein shall be construed in a manner inconsistent with the Act, the
Investment Advisers Act of 1940, or the rules and regulations promulgated
pursuant to such respective Acts.
15. This Contract will become binding on the parties hereto upon their
execution of the attached exhibits to this Contract.
16. The parties hereto acknowledge that BayBanks, Inc. has reserved the
right to grant the non-exclusive use of the name "BayFunds" or any derivative
thereof to any other investment company, investment company portfolio,
investment adviser, distributor or other business enterprise pursuant to the
terms of a Service Xxxx License Agreement, dated June 6, 1991.
INVESTMENT ADVISORY CONTRACT
EXHIBIT A
BAYFUNDS SHORT TERM YIELD PORTFOLIO
For all services rendered by Adviser hereunder, the Trust shall pay to
Adviser and Adviser agrees to accept as full compensation for all services
rendered hereunder, an annual investment advisory fee equal to .50 of 1% of
the average daily net assets of the Fund.
The fee shall be accrued daily at the rate of 1/365th of .50 of 1%
applied to the daily net assets of the Fund.
The advisory fee so accrued shall be paid to Adviser daily.
The right of the Adviser as set forth in Paragraph 6 of this Contract to
assume expenses of one or more of the Funds shall also apply as to any classes
of shares of the above-named Fund.
Witness the due execution hereof this 1ST DAY OF SEPTEMBER, 1992.
Attest: BAYBANKS INVESTMENT MANAGEMENT, INC.
/s/Xxxxxx X. Xxxxxx By:/s/Xxxx X. Arena
Clerk President
Attest: BAYFUNDS
/s/X. X. XxXxxxxxx By:/s/X. X. Xxxxxxxx
Secretary President
INVESTMENT ADVISORY CONTRACT
EXHIBIT B
BAYFUNDS EQUITY PORTFOLIO
For all services rendered by Adviser hereunder, the Trust shall pay to
Adviser and Adviser agrees to accept as full compensation for all services
rendered hereunder, an annual investment advisory fee equal to .70 of 1% of
the average daily net assets of the Fund.
The fee shall be accrued daily at the rate of 1/365th of .70 of 1%
applied to the daily net assets of the Fund.
The advisory fee so accrued shall be paid to Adviser daily.
The right of the Adviser as set forth in Paragraph 6 of this Contract to
assume expenses of one or more of the Funds shall also apply as to any classes
of shares of the above-named Fund.
Witness the due execution hereof this 1ST DAY OF SEPTEMBER, 1992.
Attest: BAYBANKS INVESTMENT MANAGEMENT, INC.
/s/Xxxxxx X. Xxxxxx By:Xxxx X. Arena
Clerk President
Attest: BAYFUNDS
/s/X. X. XxXxxxxxx By:/s/X. X. Xxxxxxxx
Secretary President
INVESTMENT ADVISORY CONTRACT
EXHIBIT C
BAYFUNDS BOND PORTFOLIO
For all services rendered by Adviser hereunder, the Trust shall pay to
Adviser and Adviser agrees to accept as full compensation for all services
rendered hereunder, an annual investment advisory fee equal to .60 of 1% of
the average daily net assets of the Fund.
The fee shall be accrued daily at the rate of 1/365th of .60 of 1%
applied to the daily net assets of the Fund.
The advisory fee so accrued shall be paid to Adviser daily.
The right of the Adviser as set forth in Paragraph 6 of this Contract to
assume expenses of one or more of the Funds shall also apply as to any classes
of shares of the above-named Fund.
Witness the due execution hereof this 1ST DAY OF SEPTEMBER, 1992.
Attest: BAYBANKS INVESTMENT MANAGEMENT, INC.
/s/Xxxxxx X. Xxxxxx By:/s/Xxxx X. Arena
Clerk President
Attest: BAYFUNDS
/s/X. X. XxXxxxxxx By:/s/X. X. Xxxxxxxx
