INVESTMENT ADVISORY AGREEMENT
AGREEMENT made this 16th day of December, 1999 by and between Friends
Ivory Funds, a Delaware business trust (the "Trust"), and Friends Ivory & Sime,
Inc. (the "Adviser").
WHEREAS, the Trust is an open-end, diversified management investment
company registered under the Investment Company Act of 1940 (the "1940 Act"), as
amended, which may consist of several series of shares, each having its own
investment policies (each, a "Fund"); and
WHEREAS, the Trust desires to retain the Adviser to render investment
management services with respect to such Funds as the Trust and the Adviser may
agree upon and as are set forth in the attached schedule, and the Adviser is
willing to render such services.
NOW, THEREFORE, in consideration of mutual covenants herein contained,
the parties hereto agree as follows:
1. DUTIES OF ADVISER. The Trust employs the Adviser to manage the
investment and reinvestment of the assets of the Fund(s), and
to hire (subject to the approval of the Trust's Board of
Trustees and, except as otherwise permitted under the terms of
any exemptive relief obtained in the future by the Adviser
from the Securities and Exchange Commission ("SEC"), or by
rule or regulation, a majority of the outstanding voting
securities of the Fund(s)) and to supervise the investment
activities of one or more sub-advisers deemed necessary to
carry out the investment program of the Trust, and to
continuously review, supervise and (where appropriate)
administer the investment program of the Trust, to determine
in its discretion (where appropriate) the securities to be
purchased or sold, to provide the Trust with records
concerning the Adviser's activities which the Trust is
required to maintain, and to render regular reports to the
Trust's officers and Trustees concerning the Adviser's
discharge of the foregoing responsibilities. The retention of
a sub-adviser by the Adviser shall not relieve the Adviser of
its responsibilities under this Agreement.
The Adviser shall discharge the foregoing responsibilities
subject to the control of the Board of Trustees of the Trust
and in compliance with such policies as the Trustees may from
time to time establish, and in compliance with the objectives,
policies, and limitations for each such Fund set forth in the
Funds' prospectus and statement of additional information as
amended from time to time, and applicable laws and
regulations.
The Adviser accepts such employment and agrees, at its own
expense, to render the services and to provide the office
space, furnishings and equipment and the personnel (including
any sub-advisers) required by it to perform the services on
the terms and for the compensation provided herein. The
Adviser will not, however, pay for the cost of securities,
commodities, and other investments (including brokerage
commissions and other transaction charges, if any) purchased
or sold for the Trust.
2. FUND TRANSACTIONS. The Adviser is authorized to select the
brokers or dealers that will execute the purchases and sales
of fund securities for the Trust and is directed to use its
best efforts to obtain the best net results as described from
time to time in the Funds' Prospectus and Statement of
Additional Information. The Adviser will promptly communicate
to the officers and the Trustees of the Trust such information
relating to fund transactions as they may reasonably request.
It is understood that the Adviser will not be deemed to have
acted unlawfully, or to have breached a fiduciary duty to the
Trust or be in breach of any obligation owing to the Trust
under this Agreement, or otherwise, by reason of its having
directed a securities transaction on behalf of the Trust to a
broker-dealer in compliance with the provisions of Section
28(e) of the Securities Exchange Act of 1934 or as described
from time to time by the Funds' Prospectus and Statement of
Additional Information.
3. COMPENSATION OF THE ADVISER. For the services to be rendered
by the Adviser as provided in Sections 1 and 2 of this
Agreement, the Trust shall pay to the Adviser compensation at
the rate specified in the Schedule(s) which are attached
hereto and made a part of this Agreement. Such compensation
shall be paid to the Adviser at the end of each month, and
calculated by applying a daily rate, based on the annual
percentage rates as specified in the attached Schedule(s), to
the assets. The fee shall be based on the average daily net
assets for the month involved (less any assets of such Funds
held in non-interest bearing special deposits with a Federal
Reserve Bank). The Adviser may, in its discretion and from
time to time, waive a portion of its fee.
All rights of compensation under this Agreement for services
performed as of the termination date shall survive the
termination of this Agreement.
4. OTHER EXPENSES. The Trust shall pay all expenses relating to
mailing to existing shareholders prospectuses, statements of
additional information, proxy solicitation material and
shareholder reports.
5. EXCESS EXPENSES. If the expenses for any Fund for any fiscal
year (including fees and other amounts payable to the Adviser,
but excluding interest, taxes, brokerage costs, litigation,
and other extraordinary costs) as calculated every business
day would exceed the expense limitations imposed on investment
companies by any applicable statute or regulatory authority of
any jurisdiction in which shares of a Fund are qualified for
offer and sale, the Adviser shall bear such excess cost.
However, the Adviser will not bear expenses of any Trust which
would result in the Trust inability to qualify as a regulated
investment company under provisions of the Internal Revenue
Code.
6. REPORTS. The Trust and the Adviser agree to furnish to each
other, if applicable, current prospectuses, proxy statements,
reports to shareholders, certified copies of their financial
statements, and such other information with regard to their
affairs as each may reasonably request.
7. STATUS OF ADVISER. The services of the Adviser to the Trust
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 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 in any way or otherwise be
deemed an agent of the Trust.
8. CERTAIN RECORDS. Any records required to be maintained and
preserved pursuant to the provisions of Rule 31a-1 and Rule
31a-2 promulgated under the 1940 Act which are prepared or
maintained by the Adviser on behalf of the Trust are the
property of the Trust and will be surrendered promptly to the
Trust on request.
9. LIMITATION OF LIABILITY OF ADVISER. The duties of the Adviser
shall be confined to those expressly set forth herein, and no
implied duties are assumed by or may be asserted against the
Adviser hereunder. The Adviser shall not be liable for any
error of judgment or mistake of law or for any loss arising
out of any investment or for any act or omission in carrying
out its duties hereunder, except a loss resulting from willful
misfeasance, bad faith or gross negligence in the performance
of its duties, or by reason of reckless disregard of its
obligations and duties hereunder, except as may otherwise be
provided under provisions of applicable state law or Federal
securities law which cannot be waived or modified hereby. (As
used in this Paragraph 9, the term "Adviser" shall include
directors, officers, employees and other corporate agents of
the Adviser as well as that entity itself.)
10. PERMISSIBLE INTERESTS. Trustees, agents, and shareholders of
the Trust are or may be interested in the Adviser (or any
successor thereof) as directors, partners, officers, or
shareholders, or otherwise; directors, partners, officers,
agents, and shareholders of the Adviser are or may be
interested in the Trust as Trustees, shareholders or
otherwise; and the Adviser (or any successor) is or may be
interested in the Trust as a shareholder or otherwise. In
addition, brokerage transactions for the Trust may be effected
through affiliates of the Adviser if approved by the Board of
Trustees, subject to the rules and regulations of the SEC.
11. LICENSE OF ADVISER'S NAME. The Adviser hereby agrees to grant
a license to the Trust for use of its name in the name of the
Trust and names of the Funds for the term of this Agreement
and such license shall terminate upon termination of this
Agreement.
12. DURATION AND TERMINATION. This Agreement, unless sooner
terminated as provided herein, shall remain in effect until
two years from date of execution, and thereafter, for periods
of one year so long as such continuance thereafter is
specifically approved at least annually (a) by the vote of a
majority of those Trustees of the Trust 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 on
such approval, and (b) by the Trustees of the Trust or by vote
of a majority of the outstanding voting securities of each
Fund; provided, however, that if the shareholders of any Fund
fail to approve the Agreement as provided herein, the Adviser
may continue to serve hereunder in the manner and to the
extent permitted by the 1940 Act and rules and regulations
thereunder. The foregoing requirement that continuance of this
Agreement be "specifically approved at least annually" shall
be construed in a manner consistent with the 1940 Act and the
rules and regulations thereunder.
This Agreement may be terminated as to any Fund at any time,
without the payment of any penalty by vote of a majority of
the Trustees of the Trust or by vote of a majority of the
outstanding voting securities of the Fund on not less than 30
days nor more than 60 days written notice to the Adviser, or
by the Adviser at any time without the payment of any penalty,
on 90 days written notice to the Trust. This Agreement will
automatically and immediately terminate in the event of its
assignment. 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 12, the terms "assignment,"
"interested persons," and a "vote of a majority of the
outstanding voting securities" shall have the respective
meanings set forth in the 1940 Act and the rules and
regulations thereunder; subject to such exemptions as may be
granted by the SEC under said Act.
13. NOTICE. Any notice required or permitted to be given by either
party to the other shall be deemed sufficient if sent by
registered or certified mail, postage prepaid, addressed by
the party giving notice to the other party at the last address
furnished by the other party to the party giving notice: if to
the Trust, at Xxx Xxxxx Xxxxx Xxxxxx, Xxxxx 0000, Xxx Xxxx, XX
00000, and if to the Adviser at Xxx Xxxxx Xxxxx Xxxxxx, Xxxxx
0000, Xxx Xxxx, XX 00000.
14. 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.
15. GOVERNING LAW. This Agreement shall be construed in accordance
with the laws of the State of Delaware and the applicable
provisions of the 1940 Act. To the extent that the applicable
laws of the State of Delaware, or any of the provisions
herein, conflict with the applicable provisions of the 1940
Act, the latter shall control.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as of the day and year first written above.
FRIENDS IVORY FUNDS
By: /s/ Xxxxxx Xxxxxx
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Name: Xxxxxx Xxxxxx
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Title: President
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Attest: /s/ Xxxxxxxxxxx X. Xxxxxxxxx
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FRIENDS IVORY & SIME, INC.
By: /s/ J. Xxxxxx Xxxxx, Jr.
------------------------
Name: J. Xxxxxx Xxxxx, Jr.
--------------------
Title: President & CEO
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Attest: /s/ Xxxxxxxxxxx X. Xxxxxxxxx
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SCHEDULE A DATED DECEMBER 16, 1999
TO THE
INVESTMENT ADVISORY AGREEMENT DATED DECEMBER 16, 1999
BETWEEN
FRIENDS IVORY FUNDS
AND
FRIENDS IVORY & SIME, INC.
Pursuant to Article 3, the Trust shall pay the Adviser compensation at an annual
rate as follows:
Fund Annual Fee
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Friends Ivory Social Awareness Fund 0.75% (75 basis points)
Friends Ivory European Social Awareness Fund 0.85% (85 basis points)
