Services as Investment Adviser. A. Subject to the general supervision and oversight of the Board of Trustees of the Trust (“Board”), the Adviser will: 1. provide a program of continuous investment management to each of the Funds listed in Schedule A in accordance with each Fund’s investment objective, strategies, policies and limitations as stated in each Fund’s prospectuses and statement of additional information (“SAI”) filed with the Securities and Exchange Commission (“SEC”), as they may be amended from time to time (each a “Prospectus” and, together, “Prospectuses”); 2. invest and reinvest the assets of each Fund by selecting the securities, instruments, repurchase agreements, financial futures contracts, options and other investments and techniques that the Fund may purchase, sell, enter into or use and what portion of the assets of each Fund will be invested or held uninvested as cash; 3. oversee the placement of purchase and sale orders on behalf of each Fund; 4. employ professional portfolio managers and securities analysts to provide research services to each of the Funds; 5. vote all proxies solicited by or with respect to the issuers of securities in which assets of each Fund may be invested in a manner that complies with the Trust’s proxy voting policies and procedures and, in the good faith judgment of the Adviser, best serves the interests of each Fund’s shareholders; maintain records of all proxies voted on behalf of each Fund; and provide information to the Trust or its designated agent in a manner that is sufficiently complete and timely to ensure the Trust’s compliance with its filing obligations under Rule 30b1-4 under the 1940 Act; 6. maintain books and records with respect to each Fund’s securities transactions; 7. provide periodic and special reports to the Board, as requested; 8. cooperate with and provide reasonable assistance to the Trust’s other service providers by: (a) keeping them fully informed as to such matters that they reasonably may deem necessary or appropriate with respect to the performance of their obligations to the each Fund, (b) providing prompt responses to reasonable requests for information or assistance and (c) establishing appropriate processes to promote the efficient exchange of information between the Adviser and each Fund’s other service providers; 9. assist in the preparation and filing of reports and proxy statements (if any) to the shareholders of each Fund, the periodic updating of the registration statement, Prospectus, SAI, and other reports and documents for the Funds required to be filed by the Trust with the SEC and other governmental bodies; and 10. designate the identity and weighting of the securities (and amount of cash, if any) to be accepted in exchange for creation units of each Fund or that will be applicable that day to redemption requests received by the Fund. B. The Adviser or its delegate shall initially determine and make any subsequent modifications to the portfolio composition file (“PCF”). The PCF shall specify the amount of the cash component, the identity and number of shares of the securities to be accepted pursuant to each Fund’s benchmark index in exchange for “Creation Units” for each Fund and the securities that will be applicable that day to redemption requests received for each Fund (and may give directions to the Trust’s custodian with respect to such designations). C. In providing those services, the Adviser will provide each Fund with ongoing research, analysis, advice and judgments regarding individual investments, general economic conditions and trends and long-range investment policy. In addition, the Adviser will furnish each Fund with whatever statistical information the Fund may reasonably request with respect to the securities that the Fund may hold or contemplates purchasing. D. The Adviser may delegate some or all of its duties and obligations under this Agreement to one or more investment sub-advisers, including but not limited to delegating the voting of proxies relating to a Fund’s portfolio securities in accordance with the proxy voting policies and procedures of such investment sub-adviser; provided, however, that any such delegation shall be pursuant to an agreement with terms agreed upon by the Board members and approved in a manner consistent with the 1940 Act. However, no such no such delegation shall relieve the Adviser of its duties and obligations with respect to the management of each Fund’s assets pursuant to this Agreement and in accordance with applicable law. E. The Adviser further agrees that, in performing its duties hereunder, it will: 1. comply, both itself and with respect to each Fund, in all material respects with (a) the 1940 Act and the Advisers Act and all rules and regulations thereunder, (b) the rules and regulations of the Commodity Futures Trading Commission (“CFTC”) with respect to the application of the Commodity Exchange Act (“CEA”), (c) the Internal Revenue Code of 1986, as amended (“Code”) and all applicable regulations under the Code, (d) the investment objectives, strategies, policies and limitations of each Fund as described in the Prospectuses, (e) the Trust’s exemptive order, (f) the Trust’s Declaration of Trust and By-Laws, and (g) all other applicable federal and state law and regulations, and with all applicable policies and procedures adopted by the Board; 2. manage each Fund so that it will qualify, and continue to qualify, as a regulated investment company under Subchapter M of the Code and regulations issued thereunder; 3. with respect to each Fund’s securities transactions and holdings, (a) maintain required and/or necessary books and records, (b) render to the Board such periodic and special reports as the Board may reasonably request, and (c) keep the Board informed of developments materially affecting each Fund’s portfolio; 4. make available to the Board, the Trust’s Chief Compliance Officer (“CCO”) and administrator, promptly upon their request, such copies of its investment records and ledgers with respect to each Fund as may be required to assist in their compliance with applicable laws and regulations. As reasonably requested by the Board, the Adviser will complete periodic or special questionnaires and furnish to the Board such periodic and special reports regarding each Fund and the Adviser. In addition, the Adviser will furnish to the Board, and, subject to compliance with any applicable policies and procedures regarding disclosure of each Fund’s portfolio holdings, to third-party data reporting services all currently available standardized performance information and other customary data; 5. make available to the Board at reasonable times its portfolio managers and other appropriate personnel, either in person or, at the mutual convenience of the Board and the Adviser, by telephone, in order to review the investment policies, performance and other matters relating to the management of each of the Funds; 6. review draft reports to shareholders and other documents provided to Adviser, provide comments on such drafts on a timely basis, and provide certifications or sub-certifications on a timely basis as to the accuracy of the information contained in such reports or other documents; 7. make available to the Trust’s administrator and, as appropriate, the Trust, promptly upon its request, such copies of its investment records and ledgers with respect to the Funds as any of them consider to be necessary and/or required to assist the administrator and the Trust in their compliance with applicable laws and regulations. The Adviser will furnish the Board with such periodic and special reports regarding each Fund as they may reasonably request;
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Samples: Investment Advisory Agreement (Horizons ETF Trust I), Investment Advisory Agreement (Horizons ETF Trust I), Investment Advisory Agreement (Horizons ETF Trust I)
Services as Investment Adviser. A. Subject to the general supervision and oversight of the Board of Trustees of the Trust (“Board”), the Adviser will:
1. provide a program of continuous investment management to each of the Funds listed in Schedule A in accordance with each Fund’s investment objective, strategies, policies and limitations as stated in each Fund’s prospectuses and statement of additional information (“SAI”) filed with the Securities and Exchange Commission (“SEC”), as they may be amended from time to time (each a “Prospectus” and, together, “Prospectuses”);
2. invest and reinvest the assets of each Fund by selecting the securities, instruments, repurchase agreements, financial futures contracts, options and other investments and techniques that the Fund may purchase, sell, enter into or use and what portion of the assets of each Fund will be invested or held uninvested as cash;
3. oversee the placement of purchase and sale orders on behalf of each Fund;
4. employ professional portfolio managers and securities analysts to provide research services to each of the Funds;
5. vote all proxies solicited by or with respect to the issuers of securities in which assets of each Fund may be invested in a manner that complies with the Trust’s proxy voting policies and procedures and, in the good faith judgment of the Adviser, best serves the interests of each Fund’s shareholders; maintain records of all proxies voted on behalf of each Fund; and provide information to the Trust or its designated agent in a manner that is sufficiently complete and timely to ensure the Trust’s compliance with its filing obligations under Rule 30b1-4 under the 1940 Act;
6. maintain books and records with respect to each Fund’s securities transactions;
7. provide periodic and special reports to the Board, as requested;
8. cooperate with and provide reasonable assistance to the Trust’s other service providers by: (a) keeping them fully informed as to such matters that they reasonably may deem necessary or appropriate with respect to the performance of their obligations to the each Fund, (b) providing prompt responses to reasonable requests for information or assistance and (c) establishing appropriate processes to promote the efficient exchange of information between the Adviser and each Fund’s other service providers;
9. assist in the preparation and filing of reports and proxy statements (if any) to the shareholders of each Fund, the periodic updating of the registration statement, Prospectus, SAI, and other reports and documents for the Funds required to be filed by the Trust with the SEC and other governmental bodies; and
10. designate the identity and weighting of the securities (and amount of cash, if any) to be accepted in exchange for creation units of each Fund or that will be applicable that day to redemption requests received by the Fund.
B. The Adviser or its delegate shall initially determine and make any subsequent modifications to the portfolio composition file (“PCF”). The PCF shall specify the amount of the cash component, the identity and number of shares of the securities to be accepted pursuant to each Fund’s benchmark index in exchange for “Creation Units” for each Fund and the securities that will be applicable that day to redemption requests received for each Fund (and may give directions to the Trust’s custodian with respect to such designations).
C. In providing those services, the Adviser will provide each Fund with ongoing research, analysis, advice and judgments regarding individual investments, general economic conditions and trends and long-range investment policy. In addition, the Adviser will furnish each Fund with whatever statistical information the Fund may reasonably request with respect to the securities that the Fund may hold or contemplates purchasing.
D. The Adviser may delegate some or all of its duties and obligations under this Agreement to one or more investment sub-advisers, including but not limited to delegating the voting of proxies relating to a Fund’s portfolio securities in accordance with the proxy voting policies and procedures of such investment sub-adviser; provided, however, that any such delegation shall be pursuant to an agreement with terms agreed upon by the Board members and approved in a manner consistent with the 1940 Act. However, no such no such delegation shall relieve the Adviser of its duties and obligations with respect to the management of each Fund’s assets pursuant to this Agreement and in accordance with applicable law.
E. The Adviser further agrees that, in performing its duties hereunder, it will:
1. comply, both itself and with respect to each Fund, in all material respects with (a) the 1940 Act and the Advisers Act and all rules and regulations thereunder, (b) the rules and regulations of the Commodity Futures Trading Commission (“CFTC”) with respect to the application of the Commodity Exchange Act (“CEA”), (c) the Internal Revenue Code of 1986, as amended (“Code”) and all applicable regulations under the Code, (d) the investment objectives, strategies, policies and limitations of each Fund as described in the Prospectuses, (e) the Trust’s exemptive order, (f) the Trust’s Declaration of Trust and By-Laws, and (g) all other applicable federal and state law and regulations, and with all applicable policies and procedures adopted by the Board;
2. manage each Fund so that it will qualify, and continue to qualify, as a regulated investment company under Subchapter M of the Code and regulations issued thereunder;
3. with respect to each Fund’s securities transactions and holdings, (a) maintain required and/or necessary books and records, (b) render to the Board such periodic and special reports as the Board may reasonably request, and (c) keep the Board informed of developments materially affecting each Fund’s portfolio;
4. make available to the Board, the Trust’s Chief Compliance Officer (“CCO”) and administrator, promptly upon their request, such copies of its investment records and ledgers with respect to each Fund as may be required to assist in their compliance with applicable laws and regulations. As reasonably requested by the Board, the Adviser will complete periodic or special questionnaires and furnish to the Board such periodic and special reports regarding each Fund and the Adviser. In addition, the Adviser will furnish to the Board, and, subject to compliance with any applicable policies and procedures regarding disclosure of each Fund’s portfolio holdings, to third-party data reporting services all currently available standardized performance information and other customary data;
5. make available to the Board at reasonable times its portfolio managers and other appropriate personnel, either in person or, at the mutual convenience of the Board and the Adviser, by telephone, in order to review the investment policies, performance and other matters relating to the management of each of the Funds;
6. review draft reports to shareholders and other documents provided to Adviser, provide comments on such drafts on a timely basis, and provide certifications or sub-certifications on a timely basis as to the accuracy of the information contained in such reports or other documents;
7. make available to the Trust’s administrator and, as appropriate, the Trust, promptly upon its request, such copies of its investment records and ledgers with respect to the Funds as any of them consider to be necessary and/or required to assist the administrator and the Trust in their compliance with applicable laws and regulations. The Adviser will furnish the Board with such periodic and special reports regarding each Fund as they may reasonably request;
8. use no inside information that may be in its possession or in the possession of any of its affiliates, nor will the Adviser seek to obtain any such information, in providing investment advice to each Fund;
9. immediately notify the Trust and the Board in the event that the Adviser or any of its affiliates becomes aware that the Adviser: (a) is subject to a statutory disqualification that prevents the Adviser from serving as an investment adviser pursuant to this Agreement; (b) fails to be registered as an investment adviser under the Advisers Act or under the laws of any jurisdiction in which the Adviser is required to be registered as an investment adviser in order to perform its obligations under this Agreement; (c) fails to be a commodity trading adviser (“CTA”) that is either exempt from registration with the CFTC or is registered with the CFTC as a CTA and a member of the National Futures Association (“NFA”), whichever is applicable, in order to perform its obligations under this Agreement; (d) is the subject of an administrative proceeding or enforcement action by the SEC, the CFTC, the NFA or other regulatory or self-regulatory authority; or (e) is served or otherwise receives notice of any action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, public board or body, or governmental authority, that involves or may reasonable be deemed to involve the affairs of the Trust. The Adviser further agrees to notify the Trust immediately of (a) any material fact known to the Adviser respecting or relating to the Adviser that is not contained in the Trust’s Registration Statement regarding any Fund, or any amendment or supplement thereto, but that is reasonably deemed to be material and, therefore, required to be disclosed therein, and (b) any statement contained in the Trust’s Registration Statement regarding any Fund that is untrue or becomes untrue in any material respect. The Adviser will promptly notify the Trust and the Board if its senior management or any member of the portfolio management team for any Fund changes or if an actual change in control or management of the Adviser occurs or is expected;
10. not disclose information regarding each Fund’s characteristics, trading history, portfolio holdings or any other related information to any third party, except in compliance with the Trust’s policies on disclosure of portfolio holdings, and otherwise treat as confidential and proprietary information regarding each Fund, including each Fund’s records and other information relative to each Fund and its prior, current or potential shareholders. The Adviser shall not use such records and information for any purpose other than the performance of its duties and responsibilities under this Agreement, except after prior notification to and approval in writing by the applicable Fund, which approval shall not be unreasonably withheld and may not be withheld where the Adviser may be exposed to civil or criminal contempt proceedings for failure to comply, when requested to divulge such information by duly constituted authorities, or when so requested by such Fund;
11. provide the Trust or the Board with such information and assurances (including certifications and sub-certifications) as the Trust or the Board may reasonably request from time to time in order to assist the Trust or the Board in complying with applicable laws, rules and regulations, including requirements in connection with the preparation and/or filing of each Fund’s Form N-CSRs, Form N-Qs or other required filings by each Fund;
12. will promptly assist the Trust in (a) determining the fair value of portfolio securities when market quotations are not readily available (including promptly making knowledgeable personnel of the Adviser available for discussions with the administrator, the Board and/or any fair valuation committee appointed by the Board upon reasonable request), (b) obtaining bids and offers or quotes from broker-dealers or market-makers with respect to securities held by the each Fund and (b) providing information upon request on valuations the Adviser has determined of securities also held by other clients of the Adviser, all for the purpose of calculating each Fund’s net asset value in accordance with the policies, procedures and methods established by the Board; and
13. meet with the Board to explain its activities at such times and places as the Board may reasonably request.
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