INVESTMENT ADVISORY AGREEMENT
This Agreement is made and entered into effective as of May 27, 2005,
by and between ▇▇▇▇ Family of Funds, a Delaware Statutory Business Trust (the
"Trust") on behalf of Halter ▇▇▇▇ USX China Fund, a series of shares of the
Trust (the "Fund"), and ▇▇▇▇ Asset Management, LLC, a Tennessee limited
liability company (the "Adviser").
WHEREAS, the Trust is an open-end management investment company,
registered under the Investment Company Act of 1940, as amended (the "1940
Act");
WHEREAS, the Trust has designated the Fund as a series of interests in the
Trust; and
WHEREAS, the Adviser is registered as an investment adviser under the
Investment Advisers Act of 1940 (the "Advisers Act"), and engages in the
business of asset management; and
WHEREAS, the Trust desires to retain the Adviser to render certain
investment management services to the Fund, and the Adviser is willing to render
such services;
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
the parties hereto agree as follows:
1. Obligations of the Investment Adviser
(a) Services. The Adviser agrees to perform the following services
(the "Services") for the Trust:
(1) manage the investment and reinvestment of the assets of
the Fund;
(2) continuously review, supervise, and administer the
investment program of the Fund;
(3) determine, in its discretion, the securities to be
purchased, retained or sold (and implement those decisions) with
respect to the Fund;
(4) provide the Trust and the Fund with records concerning the
Adviser's activities under this Agreement which the Trust and the
Fund are required to maintain; and
(5) render regular reports to the Trust's trustees and
officers concerning the Adviser's discharge of the foregoing
responsibilities.
The Adviser shall discharge the foregoing responsibilities subject to the
control of the trustees and officers of the Trust and in compliance with
(i) such policies as the trustees may from time to time establish; (ii)
the Fund's objectives, policies, and limitations as set forth in its
prospectus and statement of additional information, as the same may be
amended from time to time; and (iii) with all applicable laws and
regulations. All Services to be furnished by the Adviser under this
Agreement may be furnished through the medium of any directors, officers
or employees of the Adviser or through such other parties as the Adviser
may determine from time to time.
(b) Expenses and Personnel. The Adviser agrees, at its own expense
or at the expense of one or more of its affiliates, to render the Services
and to provide the office space, furnishings, equipment and personnel as
may be reasonably required in the judgment of the trustees and officers of
the Trust to perform the Services on the terms and for the compensation
provided herein. The Adviser shall authorize and permit any of its
officers, directors and employees, who may be elected as trustees or
officers of the Trust, to serve in the capacities in which they are
elected. Except to the extent expressly assumed by the Adviser herein and
except to the extent required by law to be paid by the Adviser, the Trust
shall pay all costs and expenses in connection with its operation.
(c) Books and Records. All books and records prepared and maintained
by the Adviser for the Trust and the Fund under this Agreement shall be
the property of the Trust and the Fund and, upon request therefor, the
Adviser shall surrender to the Trust and the Fund such of the books and
records so requested.
2. Fund Transactions. The Adviser is authorized to select the brokers or
dealers that will execute the purchases and sales of portfolio securities for
the Fund. With respect to brokerage selection, the Adviser shall seek to obtain
the best overall execution for fund transactions, which is a combination of
price, quality of execution and other factors. The Adviser may, in its
discretion, purchase and sell portfolio securities from and to brokers and
dealers who provide the Adviser with brokerage, research, analysis, advice and
similar services, and the Adviser may pay to these brokers and dealers, in
return for such services, a higher commission or spread than may be charged by
other brokers and dealers, provided that the Adviser determines in good faith
that such commission is reasonable in terms either of that particular
transaction or of the overall responsibility of the Adviser to the Fund and its
other clients and that the total commission paid by the Fund will be reasonable
in relation to the benefits to the Fund and its other clients over the
long-term. The Adviser will promptly communicate to the officers and the
trustees of the Trust such information relating to portfolio transactions as
they may reasonably request.
3. Compensation of the Adviser. The Fund will pay to the Adviser an
investment advisory fee (the "Fee") equal to an annualized rate of 1.25% of the
average daily net assets of the Fund. The Fee shall be calculated as of the last
business day of each month based upon the average daily net assets of the Fund
determined in the manner described in the Fund's Prospectus and/or Statement of
Additional Information, and shall be paid to the Adviser by the Fund within five
(5) days after such calculation.
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4. Status of Investment Adviser. The services of the Adviser to the Trust
and the Fund are not to be deemed exclusive, and the Adviser shall be free to
render similar services to others so long as its services to the Trust and the
Fund are not impaired thereby. The Adviser 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 Trust or the Fund in any way or otherwise
be deemed an agent of the Trust or the Fund. Nothing in this Agreement shall
limit or restrict the right of any director, officer or employee of the Adviser,
who may also be a trustee, officer or employee of the Trust, 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.
5. Permissible Interests. Trustees, agents, and stockholders of the Trust
are or may be interested in the Adviser (or any successor thereof) as directors,
partners, officers, or stockholders, or otherwise; and directors, partners,
officers, agents, and stockholders of the Adviser are or may be interested in
the Trust as trustees, stockholders or otherwise; and the Adviser (or any
successor) is or may be interested in the Trust as a stockholder or otherwise.
6. Limits of Liability; Indemnification. The Adviser assumes no
responsibility under this Agreement other than to render the services called for
hereunder. The Adviser shall not be liable for any error of judgment or for any
loss suffered by the Trust or the Fund in connection with the matters to which
this Agreement relates, except a loss resulting from a breach of fiduciary duty
with respect to receipt of compensation for services (in which case any award of
damages shall be limited to the period and the amount set forth in Section
36(b)(3) of the Investment Company Act of 1940) or a loss resulting from willful
misfeasance, bad faith or gross negligence on its part in the performance of, or
from reckless disregard by it of its obligations and duties under, this
Agreement. It is agreed that the Adviser shall have no responsibility or
liability for the accuracy or completeness of the Trust's registration statement
under the Act or the Securities Act of 1933, except for information supplied by
the Adviser for inclusion therein. The Trust agrees to indemnify the Adviser to
the full extent permitted by the Trust's Declaration of Trust.
7. Use of Name "▇▇▇▇." As provided in the Trust's Declaration of Trust,
the Adviser has granted to the Trust the right to use the name "▇▇▇▇" in
connection with the Trust in the United States as long as the Adviser continues
to serve as investment adviser to the Trust. Accordingly, the Adviser hereby
reserves the right, after the termination of this Agreement, to terminate the
Trust's right to use the name "▇▇▇▇" on written notice to the Trust. Upon such
notification by the Adviser, the Trust will immediately commence to take all
appropriate steps to discontinue use of the name "▇▇▇▇" and shall take all steps
necessary under applicable laws to change the name of the Trust to a name not
confusingly similar to "▇▇▇▇". If within a reasonable period of time, but in no
event longer than sixty (60) days, after receiving notification from the Adviser
as provided in this paragraph, the Trust does not discontinue the use of the
name "▇▇▇▇," the Adviser may seek such legal and equitable relief as it may deem
appropriate. The Adviser hereby reserves the right also to grant the right to
use the name "▇▇▇▇" to another investment company, business or enterprise. The
Trust hereby acknowledges and agrees that the name "▇▇▇▇" is a valuable asset of
the Adviser and that the Adviser has established a property right to its use.
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8. Term. This Agreement shall remain in effect for an initial term of two
years from the date hereof, and from year to year thereafter provided such
continuance is approved at least annually by the vote of a majority of the
trustees of the Trust who are not "interested persons" (as defined in the Act)
of the Trust, which vote must be cast in person at a meeting called for the
purpose of voting on such approval; provided, however, that:
(a) the Trust may, at any time and without the payment of any
penalty, terminate this Agreement upon 60 days written notice of a
decision to terminate this Agreement by (i) the Trust's trustees; or (ii)
the vote of a majority of the outstanding voting securities of the Fund;
(b) this Agreement shall immediately terminate in the event of its
assignment (within the meaning of the Act and the Rules thereunder);
(c) the Adviser may, at any time and without the payment of any
penalty, terminate this Agreement upon 60 days written notice to the Trust
and the Fund; and
(d) the terms of paragraphs 6 and 7 of this Agreement shall survive
the termination of this Agreement.
9. Amendments. 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 amendment of this Agreement shall be effective
until approved by vote of the holders of a majority of the Trust's outstanding
voting securities.
10. Applicable Law. This Agreement shall be construed in accordance with,
and governed by, the laws of the State of Delaware.
11. Representations and Warranties.
(a) Representations and Warranties of the Adviser. The Adviser
hereby represents and warrants to the Trust as follows: (i) the Adviser is
a limited liability company duly organized and in good standing under the
laws of the State of Tennessee and is fully authorized to enter into this
Agreement and carry out its duties and obligations hereunder; and (ii) the
Adviser is registered as an investment adviser with the SEC under the
Advisers Act, and shall maintain such registration in effect at all times
during the term of this Agreement.
(b) Representations and Warranties of the Trust. The Trust hereby
represents and warrants to the Adviser as follows: (i) the Trust has been
duly organized as a business trust under the laws of the State of Delaware
and is authorized to enter into this Agreement and carry out its terms;
(ii) the Trust is (or will be) registered as an investment company with
the Securities and Exchange Commission under the 1940 Act; (iii) shares of
each Trust are (or will be) registered for offer and sale to the public
under the 1933 Act; and (iv) such registrations will be kept in effect
during the term of this Agreement.
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12. Structure of Agreement. The Trust is entering into this Agreement
solely on behalf of the Fund. No breach of any term of this Agreement shall
create a right or obligation with respect to any series of the Trust other than
the Fund; (b) under no circumstances shall the Adviser have the right to set off
claims relating to the Fund by applying property of any other series of the
Trust; and (c) the business and contractual relationships created by this
Agreement, consideration for entering into this Agreement, and the consequences
of such relationship and consideration relate solely to the Trust and the Fund.
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 and, to this extent, the provisions of
this Agreement shall be deemed to be severable.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and the year first written above.
▇▇▇▇ FAMILY OF FUNDS ▇▇▇▇ ASSET MANAGEMENT, LLC
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇ /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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By: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇ By: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: President Title: President
ATTEST: ATTEST:
Secretary Secretary
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[Corporate Seal] [Corporate Seal]
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