Ex-99.B5
INVESTMENT ADVISORY AGREEMENT
TO: Parker, Dillon, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, Inc.
Governours Square Office Center
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇-▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Dear Sirs:
PDC&J Preservation Fund (hereinafter referred to as the "Fund") herewith
confirms our agreement with you.
The Fund has been organized as an Ohio business trust to engage in the
business of an investment company. You have been selected to act as the sole
investment adviser of the Fund and to provide certain other servis, as more
fully set forth below, and you are willing to act as such investment adviser
and to perform such services under the terms and conditions hereinafter set
forth. Accordingly, the Fund agrees with you, and by your execution of the
Acceptance at the end hereof you agree with the Fund, as follows upon the
date of your execution of this Agreement.
1. ADVISORY SERVICES
You will regularly provide the Fund with such investment research,
advice and supervision as you in your discretion deem advisable and will
furnish a continuous investment program for the Fund consistent with the
Fund's investment objectives and policies. You will determine what securities
shall be purchased for the Fund, what portfolio securities shall be held or
sold by the Fund, and what portion of the Fund's assets shall be held
uninvested, subject always to the Fund's investment objectives, policies and
restrictions, as each of the same shall be from time to time in effect, and
subject further to such policies and instructions as the Board of Trustees
(the "Board") of the Fund may from time to time establish and supply to you
copies thereof. You will advise and assist the officers of the Fund in taking
such steps as are necessary or appropriate to carry out the decisions of the
Board and the appropriate committees of such Board regarding the conduct of
the business of the Fund.
2. ALLOCATION OF CHARGES AND EXPENSES
You or your affiliate, PDC&J Service Corp., will pay the compensation
and expenses of any persons rendering any services to the Fund who are
officers, directors, shareholders or employees of your corporation and will
make available, without expense to the Fund, the services of such of your
employees as may duly be elected officers or trustees of the Fund, subject to
their individual consent to serve and to any limitations imposed by law.
The Fund will be responsible for the payment of all interest, taxes,
brokerage and extraordinary or non-recurring expenses, including expenses of
any litigation to which the Fund may be a party and indemnification of the
Fund's officers, directors and shareholders with respect thereto, and of fees
payable under this Agreement and under the Management and Transfer Agent
Agreement.
All other expenses incurred in the administration of the Fund shall be
borne by your affiliate, PDC&J Service Corp.
3. COMPENSATION OF THE ADVISER
For all of the services to be rendered and payments made as provided in
this Agreement the Fund will pay you as of the last day of each month a
monthly fee, accrued daily, equal to the annual rate of .5% of the daily net
asset value of the Fund.
The total fees paid during the first and second halves of each fiscal
year of the Fund shall not exceed the semiannual total of the daily fee
accruals requested by you during the applicable six-month period. The daily
net asset value shall be determined pursuant to the applicable provisions of
the Declaration of Trust of the Fund or a resolution of the Board, if
required. If, pursuant to such provisions, the determination of net asset
value is suspended for any particular business day, then for the purposes of
this paragraph, the value of the net assets of the Fund as last determined
shall be deemed to be the value of the net assets as of the close of the
business day, or as of such other time as the value of the Fund's net assets
may lawfully be determined, on that day. If the determination of the net
asset value of the Fund's shares has been suspended for a period including
such month, your compensation payable at the end of such month shall be
computed on the basis of the value of the net assets of the Fund as last
determined (whether during or prior to such month).
You agree that your compensation during any fiscal year shall be reduced
by an amount, if any, by which the expenses of the Fund for such fiscal year
exceed the lowest applicable expense limitation applicable to the Fund
imposed by State securities administrators in States where the Fund's shares
are qualified for sale, as such limitations may be lowered or raised from
time to time. The payment of your compensation at the end of any month will
be reduced or postponed or, if necessary, a refund will be made to the Fund
as soon as practicable. You or your affiliate, PDC&J Service Corp., shall
refund to the Fund within sixty days after the close of each fiscal year, the
amount of any additional reduction of your compensation pursuant to this
paragraph as promptly as practicable after the end of such fiscal year,
provided, however, that you will not be required to pay the Fund an amount
greater than the fee paid to you in respect of such year pursuant to this
Agreement nor will your affiliate be required to pay the Fund an amount
greater than the fee paid to it under its Management And Transfer Agent
Agreement with the Fund. As used in this paragraph "expenses" shall mean
those expenses included in the applicable expense limitation having the
broadest specification thereof (certain expenses such as brokerage
commissions, if any, taxes, interest and extra ordinary items are excluded
from such limitations), and "expense limitation" means a limit on the
maximum annual expenses which may be incurred by an investment company
determined (1) by multiplying a fixed percentage by the average or
multiplying more than one such percentage by different specified amounts of
the average of the values of an investment company's net assets for a fiscal
year or (2)by multiplying a fixed percentage of an investment company's net
investment income for a fiscal year. The words "lowest expense limitation"
shall be construed to result in the largest reduction of your compensation
for any fiscal year of the Fund.
4. EXECUTION OF PURCHASE AND SALE ORDERS
In connection with purchases or sales of portfolio securities for the
account of the Fund, it is understood that you will arrange for the placing
of all orders for the purchase and sale of portfolio securities for the
Fund's account with brokers or dealers selected by you subject to review of
this selection by the Fund's Board from time to time. In the selection of
such brokers or dealers and the placing of such orders, you are directed at
all times to seek for the Fund the best net results for the Fund, taking into
account such factors as price, size of order, difficulties of execution and
operational facilities of the firm involved and the firm's risk in
positioning a block of securities.
To the extent that the execution and price offered by more than one
dealer are comparable, you may in your discretion, choose to purchase and
sell portfolio securities from and to dealers who provide (a) research,
statistical and other information to the Fund and to you, and (b) the
occasional sale of Fund shares. The Fund and you understand and acknowledge
that, although the information and occasional sales may be useful to the Fund
and you, it is not possible to place a dollar value on such information or
occasional sales. It is the Fund's opinion, as well as your opinion, that
neither the review and study of this information nor such occasional sales
will reduce the overall cost to you in performing your duties to the Fund
under this Agreement.
If any occasion should arise in which you give any advice to clients of
yours concerning the shares of the Fund, you will act solely as investment
counsel for such client and not in any way on behalf of the Fund. Your
services to the Fund pursuant to this Agreement are not to be deemed to be
exclusive and it is understood that you may render investment advice,
management and other services to others.
5. LIMITATION OF LIABILITY OF ADVISER
You shall not be liable for any error of judgment or mistake of law or
for any loss suffered by the Fund in connection with the matters to which
this Agreement relates, except a loss resulting from willful misfeasance, bad
faith or gross negligence on your part in the performance of your duties or
from reckless disregard by you of your obligations and duties under this
Agreement ("disabling conduct"). However, you will not be indemnified for any
liability unless (1) a final decision is made on the merits by a court or
other body before whom the proceeding was brought that you were not liable by
reason of disabling conduct or, (2) in the absence of such a decision, a
reasonable determination is made, based upon a review of the facts, that you
were not liable by reason of disabling conduct, by (a) the vote of a majority
of a quorum of trustees who are neither "interested persons" of the Fund as
defined in the Investment Company Act of 1940 nor uarties to the proceeding
"disinterested, non-party trustees"), or (b) an independent legal counsel in
a written opinion. The Fund will advance attorneys' fees or other expenses
incurred by you in defending a proceeding, upon the undertaking by or on
behalf of you to repay the advance unless it is ultimately determined that
you are entitled to indemnification, so long as you meet at least one of the
following as a condition to the advance: (1) you shall provide a security for
your undertaking, (2) the Fund shall be insured against losses arising by
reason of any lawful advances, or (3) a majority of a quorum of the
disinterested, non-party trustees of the Fund, or an independent legal
counsel in a written opinion, shall determine, based on a review of readily
available facts (as opposed to a full trial-type inquiry), that there is
reason to believe that you ultimately will be found entitled to
indemnification. Any person employed by you who may also be or become an
employee of the Fund shall be deemed, when acting within the scope of his
employment by the Fund, to be acting in such employment solely for the Fund
and not as your employee or agent.
6. DURATION AND TERMINATION OF THIS AGREEMENT
This Agreement shall become effective on the date of your Acceptance
hereof and shall remain in effect until the first Annual Meeting of
Shareholders of the Fund, unless: sooner terminated as hereinafter provided.
This Agreement shall continue in force from year to year thereafter but only
so long as such continuance is approved annually in the manner required by
the Investment Company Act of 1940.
This Agreement may, on sixty days written notice, be terminated at any
time without the payment of any penalty, by vote of a majority of the members
of the Board who are not interested persons of the Fund, as defined in the
Investment Company Act of 1940 and who have no direct or indirect financial
interest in the operation of any plan adopted under Rule 12b-1 under the
Investment Company Act of 1940 or in any agreements relating to such plan, by
vote of a majority of the outstanding voting securities of the Fund or by
you. This Agreement shall automatically terminate in the event of its
assignment.
7. AMENDMENT OF THIS AGREEMENT
No provision of this Agreement may be changed, waived, discharged or
terminated orally, and no amendment of this Agreement shall be effective
until approved by vote of the holders of a majority of the outstanding voting
securities of the Fund and by the Board, including a majority of the trustees
who are not interested persons of you or of the Fund, cast in person at a
meeting called for the purpose of voting on such approval.
8. LIMITATION OF LIABILITY
It is expressly agreed that the obligations of the Fund hereunder shall
not be binding upon any of the trustees, shareholders, nominees, officers,
agents or employees of the Fund, personally, but bind only the assets and
property of the Fund as provided in its Declaration of Trust. The execution
and delivery of this Agreement have been authorized by the trustees of the
Fund and signed by the President of the Fund, acting as such, and will be
approved by shareholders of the Fund, and neither such authorization or
approval by such trustees and shareholders nor such execution and delivery by
such officer shall be deemed to have been made by any of them individually or
to impose any liability on any of them personally, but shall bind only the
assets and property of the Fund as provided in its Declaration of Trust.
9. 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 construction or effect. This Agreement may be executed
simultaneously in two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
Agreement.
If you are in agreement with the foregoing, please sign the form of
acceptance on the accompanying counterpart of this letter and return such
counterpart to the Fund, whereupon this letter shall become a binding
contract upon the date of your Acceptance.
Yours very truly,
ATTEST: PDC&J PRESERVATION FUND
/S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ By /S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ III
---------------------------- --------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Secretary ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ III, President
Dated: January 4, 1985
ACCEPTANCE
The foregoing Agreement is hereby accepted.
ATTEST: PARKER, DILLON, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, INC.
/S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ III
----------------------- --------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ III
Secretary President
Dated: January 4, 1985