Renewal of Investment Advisory Contract

During their meeting of September 28, 2009, the Trustees of Saturna Investment Trust discussed the Trust's various management agreements. They focused on renewing the Idaho Tax-Exempt Fund's Investment Advisory and Administration Agreement with Saturna Capital Corporation, discussing various materials provided by Saturna. The Trustees took into consideration that the Fund offers a full range of high-quality investor services, and that there had been enhancements in Saturna's operations during the last year. The Trustees remarked on Saturna's experience, ability and commitment to quality service through performing internally such functions as shareowner servicing, administration, retirement plan and trust services, accounting, marketing, and distribution — in addition to investment management.

In addition to information provided throughout the year, the Trustees utilized a comparison of performance and expenses of the Fund with those of other single-state tax-exempt mutual funds. The Trustees reviewed Morningstar and Lipper mutual fund category comparisons, and found that the investment performance of the Fund was strong. Specifically, Lipper found the Fund to rank in the top 7% of 137 "other states Muni" category funds for the twelve months ending September 1, 2009 and rank in the top 3% of 128 category funds for the 3 years ending September 1, 2009. The Trustees found such information helpful in establishing expectations regarding the performance of the adviser and whether to continue the advisory contract.

The Trustees took into consideration Saturna's continued avoidance of significant operational problems, plus its substantial investments in premises, personnel, training and equipment to meet investor needs. They recognized Saturna's efforts to recruit and retain increasingly qualified, experienced and specialized staff and improve the capital base on which Saturna operates, which the Trustees believe is important to the long-term success of all mutual funds.

The Trustees reviewed Saturna's profitability with respect to the Fund as part of their evaluation of whether the fee under the advisory contract bears a reasonable relationship to the mix of services provided by Saturna, including the nature, extent and quality of such services. They considered the fees charged by the adviser to other kinds of accounts and the different services provided to those accounts. The Trustees noted that, although the assets of the Fund have grown, the Fund remains small, and there has been no opportunity for Saturna to demonstrate economies of scale. In fact, Saturna continues to operate the Fund at significant cost to itself. The Trustees also considered whether there are other potential benefits to Saturna from acting as investment adviser and found none. The Trustees noted Saturna's continued efforts to build a capital base in order that it might properly service the Fund, the value of which was apparent during recent financial turmoil.

The Trustees also considered potential benefits to Saturna from acting as investment adviser and noted that there were no soft dollar arrangements with respect to trading in the Fund's portfolio, and that Saturna continues to voluntarily waive brokerage commissions for Fund portfolio trades at a considerable and growing cost to Saturna and that this results in savings to Fund shareowners.

The Trustees concluded that the fee paid by the Fund to Saturna is reasonable in light of the services provided, comparative performance, expense and advisory fee information, costs of services provided and profits to be realized and benefits derived or to be derived by Saturna from its relationship with the Fund. The Trustees saw no need for advisory fee changes or breakpoints. Following this discussion, the Trustees unanimously agreed to renew the Investment Advisory and Administration Agreements between the Fund and Saturna Capital Corporation.