INVESTMENT MANAGEMENT AGREEMENT
AGREEMENT made this 1st day of November 1998, by and
between PENN STREET FUND, INC., a Maryland corporation
(the "Fund") and Penn Street Advisors, Inc., a Pennsylvania
corporation (the "Manager").
1. Duties of Advisor
The Fund hereby employs the Manager to manage the investment
and reinvestment of the assets of the Global Equity Portfolio
(the "Portfolio"), to continuously review, supervise and administer
the Portfolio's investment program, to determine in its discretion
the securities to be purchased or sold and the portion of the
Portfolio's assets to be uninvested, to provide the Fund with
records concerning the Manager's activities which the Fund is
required to maintain, and to render regular reports to the Fund's
officers and the Board of Directors of the Fund, all in compliance
with the objectives, policies and limitations set forth in the
Fund's registration statement. The Manager accepts such employment
and agrees to provide, at its own expense, the office space,
furnishings and equipment and the personnel required by it to
perform the services described herein on the terms and for the
compensation provided herein.
2. Portfolio Transactions
The Manager is authorized to select the brokers or
dealers that will execute the purchases and sales of portfolio
securities for the Portfolio and is directed to use its best
efforts to obtain the best available price and most favorable
execution. It is understood, however, that the Manager shall
not be deemed to have acted unlawfully, or to have breached a
fiduciary duty to the Fund or in respect of the Portfolio, or
be in breach of any obligation owing to the Fund or in respect
of the Portfolio under this Agreement, or otherwise, solely by
reason of its having caused the Portfolio to pay a member of a
securities exchange, a broker or a dealer a commission for
effecting a securities transaction for the Portfolio in excess of
the amount of commission another member of an exchange, broker or
dealer would have charged if the Manager determines in good faith
that the commission paid was reasonable in relation to the brokerage
or research services provided by such member, broker or dealer,
viewed in terms of that particular transaction or the Manager's
overall responsibilities with respect to its accounts, including
the Fund, as to which it exercises investment discretion. The
Manager will promptly communicate to the officers and directors
of the Fund such information relating to transactions for the
Portfolio as they may reasonably request.
3. Compensation of the Manager
For the services to be rendered by the Manager as
provided in Section 1 of this Agreement, the Fund shall pay
to the Manager, at the end of each month, a fee equal to one-
twelfth of .75 percent of the average daily net assets of the
Portfolio. In the event that this Agreement is terminated at
other than a month-end, the fee for such month shall be prorated.
4. Reports
The Fund and the Manager agree to furnish to each
other information with regard to their respective affairs as
each may reasonably request.
5. Status of the Manager
The services of the Manager to the Fund or in respect
of the Portfolio, are not to be deemed exclusive, and the Manager
shall be free to render similar services to others as long as its
services to the Fund, or in respect of the Portfolio, are not
impaired thereby. The Manager shall be deemed to be an independent
contractor and shall, unless otherwise expressly provided or
authorized, have no authority to act for or represent the Fund
in any way or otherwise be deemed an agent of the Fund.
6. Liability of Manager
The Manager shall not be liable to the Fund or any
shareholder thereof for errors of judgment or in absence of
negligence in the performance of its duties hereunder.
No provision of this Agreement shall be deemed to protect
the Manager against any liability to the Fund to which it might
otherwise be subject by reason of willful misfeasance, bad faith
or gross negligence in the performance of its duties or the reckless
disregard of its obligations under this Agreement.
7. Duration and Termination
This Agreement shall become effective on November 1,
1998 (the "Effective Date") and shall continue in effect until
October 31, 2000, provided that it has first been approved in
accordance with Section 15 of the Investment Company Act of 1940,
as amended ("Act"). Thereafter, this Agreement may be continued
in effect for successive one-year periods provided each such
continuance is approved at least annually by a vote of the Fund's
Board of Directors, including the vote of a majority of the
directors who are not parties to this Agreement or interested
persons of any such party, cast in person, at a meeting called
for the purpose of voting such approval. In addition, the
question of continuance of this Agreement may be presented
to the shareholders of the Fund; in such event, such continuance
shall be effected only if approved by the affirmative vote of the
holders of a majority of the outstanding voting securities of the
Portfolio.
This Agreement may at any time be terminated without
payment of any penalty either by vote of the Board of Directors
of the Fund or by vote of the holders of a majority of the
outstanding voting securities of the Portfolio, on sixty days
written notice to the Manager.
This Agreement shall automatically terminate in the
event of its assignment.
This Agreement may be terminated by the Manager
after ninety days written notice to the Fund.
Any notice under this Agreement shall be given in
writing, addressed and delivered, or mailed postpaid, to the
other party at any office of such party.
As used in this Section 9, the terms "assignment," "
interested persons," and a "vote of the holders of a majority
of the outstanding securities" shall have the respective
meanings set forth in Section 2(a)(4), Section 2(a)(19),
Section 2(a)(42) of the Act and Rule l8f-2 thereunder.
8. 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.
IN WITNESS WHEREOF, the parties hereby have caused this
Agreement to be executed this 30th day of October 0000.
Xxxx Xxxxxx Advisors, Inc. Penn Street Fund, Inc.
By:_________________________ By:_________________________
President
