Exhibit (d)(2)(xxi)
IXIS INCOME DIVERSIFIED PORTFOLIO
Sub-Advisory Agreement
(Xxxxxx, Xxxxxx & Company, L.P.)
(Multi-Sector Bond Discipline)
Sub-Advisory Agreement (this "Agreement") entered into as of 1/st/ day of
November, 2005, by and among IXIS Advisor Funds Trust I, a Massachusetts
business trust (the "Trust"), with respect to its IXIS Income Diversified
Portfolio series (the "Series"), IXIS Asset Management Advisors, L.P., a
Delaware limited partnership (the "Manager"), and Xxxxxx, Xxxxxx & Company,
L.P., a Delaware limited partnership (the "Sub-Adviser").
WHEREAS, the Manager has entered into an Advisory Agreement dated
November 1, 2005 (the "Advisory Agreement") with the Trust, relating to the
provision of portfolio management and administrative services to the Series;
WHEREAS, the Advisory Agreement provides that the Manager may delegate any
or all of its portfolio management responsibilities under the Advisory
Agreement to one or more sub-advisers;
WHEREAS, the Manager and the Trustees of the Trust desire to retain the
Sub-Adviser to render portfolio management services in the manner and on the
terms set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth in this Agreement, the Trust, the Manager and the Sub-Adviser agree as
follows:
1. Sub-Advisory Services.
a. The Sub-Adviser shall, subject to the supervision of the Manager and
of any administrator appointed by the Manager (the "Administrator"), manage
the investment and reinvestment of such portion of the assets of the Series
designated as the "Xxxxxx Xxxxxx Multi Sector Bond Discipline" as the
Manager may from time to time allocate to the Sub-Adviser for management
(the "Segment") and the Sub-Adviser shall have the authority on behalf of
the Series to vote and shall vote all proxies and exercise all other rights
of the Series as a security holder of companies in which the Segment from
time to time invests. The Sub-Adviser shall manage the Segment in conformity
with (1) the investment objective, policies and restrictions of the Series
set forth in the Trust's prospectus
and statement of additional information relating to the Series, (2) any
additional policies or guidelines established by the Manager or by the
Trust's trustees that have been furnished in writing to the Sub-Adviser and
(3) the provisions of the Internal Revenue Code as amended (the "Code")
applicable to "regulated investment companies" (as defined in Section 851 of
the Code), all as from time to time in effect (collectively, the
"Policies"), and with all applicable provisions of law, including without
limitation all applicable provisions of the Investment Company Act of 1940
as amended (the "1940 Act") and the rules and regulations thereunder. For
purposes of compliance with the Policies, the Sub-Adviser shall be entitled
to treat the Segment as though the Segment constituted the entire Series,
and the Sub-Adviser shall not be responsible in any way for the compliance
of any assets of the Series, other than the Segment, with the Policies, or
for the compliance of the Series, taken as a whole, with the Policies.
Subject to the foregoing, the Sub-Adviser is authorized, in its discretion
and without prior consultation with the Manager, to buy, sell, lend and
otherwise trade in any stocks, bonds and other securities and investment
instruments on behalf of the Series, without regard to the length of time
the securities have been held and the resulting rate of portfolio turnover
or any tax considerations; and the majority or the whole of the Segment may
be invested in such proportions of stocks, bonds, other securities or
investment instruments, or cash, as the Sub-Adviser shall determine.
Notwithstanding the foregoing provisions of this Section 1.a; however, the
Sub-Adviser shall, upon written instructions from the Manager, effect such
portfolio transactions for the Segment as the Manager shall determine are
necessary in order for the Series to comply with the Policies.
b. The Sub-Adviser shall furnish the Manager and the Administrator
monthly, quarterly and annual reports concerning portfolio transactions and
performance of the Segment in such form as may be mutually agreed upon, and
agrees to review the Segment and discuss the management of it. The
Sub-Adviser shall permit all books and records with respect to the Series to
be inspected and audited by the Manager and the Administrator at all
reasonable times during normal business hours, upon reasonable notice. The
Sub-Adviser shall also provide the Manager with such other information and
reports as may reasonably be requested by the Manager from time to time,
including without limitation all material requested by or required to be
delivered to the Trustees of the Trust.
c. The Sub-Adviser shall provide to the Manager a copy of the
Sub-Adviser's Form ADV as filed with the Securities and Exchange Commission
and a list of the persons whom the Sub-Adviser wishes to have authorized to
give written and/or oral instructions to custodians of assets of the Series.
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2. Obligations of the Manager.
a. The Manager shall provide (or cause the Series' Custodian (as defined
in Section 3 hereof) to provide) timely information to the Sub-Adviser
regarding such matters as the composition of assets of the Segment, cash
requirements and cash available for investment in the Segment, and all other
information as may be reasonably necessary for the Sub-Adviser to perform
its responsibilities hereunder.
b. The Manager has furnished the Sub-Adviser a copy of the prospectus and
statement of additional information of the Series and agrees during the
continuance of this Agreement to furnish the Sub-Adviser copies of any
revisions or supplements thereto at, or, if practicable, before the time the
revisions or supplements become effective. The Manager agrees to furnish the
Sub-Adviser with minutes of meetings of the trustees of the Trust applicable
to the Series to the extent they may affect the duties of the Sub-Adviser,
and with copies of any financial statements or reports made by the Series to
its shareholders, and any further materials or information which the
Sub-Adviser may reasonably request to enable it to perform its functions
under this Agreement.
3. Custodian. The Manager shall provide the Sub-Adviser with a copy of the
Series' agreement with the custodian designated to hold the assets of the
Series (the "Custodian") and any modifications thereto (the "Custody
Agreement"), copies of such modifications to be provided to the Sub-Adviser a
reasonable time in advance of the effectiveness of such modifications. The
assets of the Segment shall be maintained in the custody of the Custodian
identified in, and in accordance with the terms and conditions of, the Custody
Agreement (or any sub-custodian properly appointed as provided in the Custody
Agreement). The Sub-Adviser shall have no liability for the acts or omissions
of the Custodian, unless such act or omission is taken solely in reliance upon
instruction given to the Custodian by a representative of the Sub-Adviser
properly authorized to give such instruction under the Custody Agreement. Any
assets added to the Series shall be delivered directly to the Custodian.
4. Proprietary Rights. The Manager agrees and acknowledges that the
Sub-Adviser is the sole owner of the name "Xxxxxx, Xxxxxx & Company, L.P." and
that all use of any designation consisting in whole or part of "Xxxxxx,
Xxxxxx & Company, L.P." under this Agreement shall inure to the benefit of the
Sub-Adviser. The Manager on its own behalf and on behalf of the Series agrees
not to use any such designation in any advertisement or sales literature or
other materials promoting the Series, except with the prior written consent of
the Sub-Adviser. Without the prior written consent of the Sub-Adviser, the
Manager shall not, and the Manager shall use its best efforts to cause the
Series not to, make representations regarding the Sub-Adviser in any disclosure
document, advertisement or sales literature or other materials relating to the
Series. Upon
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termination of this Agreement for any reason, the Manager shall cease, and the
Manager shall use its best efforts to cause the Series to cease, all use of any
such designation as soon as reasonably practicable.
5. Expenses. Except for expenses specifically assumed or agreed to be paid
by the Sub-Adviser pursuant hereto, the Sub-Adviser shall not be liable for any
organizational, operational or business expenses of the Manager or the Trust
including, without limitation, (a) interest and taxes, (b) brokerage
commissions and other costs in connection with the purchase or sale of
securities or other investment instruments with respect to the Series, and
(c) custodian fees and expenses. Any reimbursement of advisory fees required by
any expense limitation provision of any law shall be the sole responsibility of
the Manager. The Manager and the Sub-Adviser shall not be considered as
partners or participants in a joint venture. The Sub-Adviser will pay its own
expenses incurred in furnishing the services to be provided by it pursuant to
this Agreement. Neither the Sub-Adviser nor any affiliated person thereof shall
be entitled to any compensation from the Manager or the Trust with respect to
service by any affiliated person of the Sub-Adviser as an officer or trustee of
the Trust (other than the compensation to the Sub-Adviser payable by the
Manager pursuant to Section 7 hereof).
6. Purchase and Sale of Assets. Absent instructions from the Manager to the
contrary, the Sub-Adviser shall place all orders for the purchase and sale of
securities for the Segment with brokers or dealers selected by the Sub-Adviser,
which may include brokers or dealers affiliated with the Sub-Adviser, provided
such orders comply with Rule 17e-1 under the 1940 Act in all respects. To the
extent consistent with applicable law, purchase or sell orders for the Segment
may be aggregated with contemporaneous purchase or sell orders of other clients
of the Sub-Adviser. The Sub-Adviser shall use its best efforts to obtain
execution of transactions for the Segment at prices which are advantageous to
the Series and at commission rates that are reasonable in relation to the
benefits received. However, the Sub-Adviser may select brokers or dealers on
the basis that they provide brokerage, research or other services or products
to the Series and/or other accounts serviced by the Sub-Adviser. To the extent
consistent with applicable law, the Sub-Adviser may pay a broker or dealer an
amount of commission for effecting a securities transaction in excess of the
amount of commission or dealer spread another broker or dealer would have
charged for effecting that transaction if the Sub-Adviser determines in good
faith that such amount of commission was reasonable in relation to the value of
the brokerage and research products and/or services provided by such broker or
dealer. This determination, with respect to brokerage and research services or
products, may be viewed in terms of either that particular transaction or the
overall responsibilities which the Sub-Adviser and its affiliates have with
respect to the Series or to accounts over which they exercise investment
discretion. Not all such services or products need be used by the Sub-Adviser
in managing the Segment.
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To the extent permitted by applicable law, and in all instances subject to
the foregoing policy of best execution, the Sub-Adviser may allocate brokerage
transactions to broker-dealers (including affiliates of IXIS Asset Management
Distributors, L.P.) that have entered into arrangements in which the
broker-dealer allocates a portion of the commissions paid by a fund toward the
reduction of that fund's expenses, subject to the policy of best execution.
The Manager agrees that, subject to its fiduciary duties to the Series
arising from its position as Manager of the Series, the Manager shall not
dictate brokerage allocation or selection decisions or investment decisions to
or for the Series, either directly or pursuant to directions given to the
Sub-Adviser by the Manager; provided, however, that nothing in this paragraph
shall prohibit officers of the Trust (who may also be officers or employees of
the Manager) from exercising authority conferred upon them as officers of the
Trust by the Board of Trustees of the Trust.
7. Compensation of the Sub-Adviser. As full compensation for all services
rendered, facilities furnished and expenses borne by the Sub-Adviser hereunder,
the Sub-Adviser shall be paid at the annual rate of 0.35% of the first $250
million of the average daily net assets of its Segment and 0.30% of its
Segment's average daily net assets in excess of $250 million (or such lesser
amount as the Sub-Adviser may from time to time agree to receive). Such
compensation shall be paid by the Trust (except to the extent that the Trust,
the Sub-Adviser and the Manager otherwise agree in writing from time to time).
Such compensation shall be payable monthly in arrears or at such other
intervals, not less frequently than quarterly, as the Manager is paid by the
Series pursuant to the Advisory Agreement.
8. Non-Exclusivity. The Manager and the Trust on behalf of the Series agree
that the services of the Sub-Adviser are not to be deemed exclusive and that
the Sub-Adviser and its affiliates are free to act as investment manager and
provide other services to various investment companies and other managed
accounts, except as the Sub-Adviser and the Manager or the Administrator may
otherwise agree from time to time in writing before or after the date hereof.
This Agreement shall not in any way limit or restrict the Sub-Adviser or any of
its directors, officers, employees or agents from buying, selling or trading
any securities or other investment instruments for its or their own account or
for the account of others for whom it or they may be acting, provided that such
activities do not adversely affect or otherwise impair the performance by the
Sub-Adviser of its duties and obligations under this Agreement. The Manager and
the Trust recognize and agree that the Sub-Adviser may provide advice to or
take action with respect to other clients, which advice or action, including
the timing and nature of such action, may differ from or be identical to advice
given or action taken with respect to the Series. The Sub-Adviser shall for all
purposes hereof be deemed to be an independent contractor and shall, unless
otherwise provided or authorized, have no authority to act for or represent the
Trust or the Manager in any way or otherwise be deemed an agent of the Series
or the Manager.
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9. Liability. Except as may otherwise be provided by the 1940 Act or other
federal securities laws, neither the Sub-Adviser nor any of its officers,
directors, partners, employees or agents (the "Indemnified Parties") shall be
subject to any liability to the Manager, the Trust, the Series or any
shareholder of the Series for any error of judgment, any mistake of law or any
loss arising out of any investment or other act or omission in the course of,
connected with, or arising out of any service to be rendered under this
Agreement, except by reason of willful misfeasance, bad faith or gross
negligence in the performance of the Sub-Adviser's duties or by reason of
reckless disregard by the Sub-Adviser of its obligations and duties hereunder.
The Manager shall hold harmless and indemnify the Sub-Adviser for any loss,
liability, cost, damage or expense (including reasonable attorneys fees and
costs) arising from any claim or demand by any past or present shareholder of
the Series that is not based upon the obligations of the Sub-Adviser with
respect to the Segment under this Agreement.
Without limiting the foregoing, it is expressly understood and agreed that
the Manager and the Series shall hold harmless and indemnify the Indemnified
Parties for any loss arising out of any act or omission of any other
sub-adviser to the Series, or for any loss arising out of the failure of the
Series to comply with the Policies, except for losses arising out of the
Sub-Adviser's failure to comply with the Policies with respect to the Segment.
The Manager acknowledges and agrees that the Sub-Adviser makes no
representation or warranty, expressed or implied, that any level of performance
or investment results will be achieved by the Series or the Segment or that the
Series or the Segment will perform comparably with any standard or index,
including other clients of the Sub-Adviser, whether public or private.
10. Effective Date and Termination. This Agreement shall become effective as
of the date of its execution, and
a. unless otherwise terminated, this Agreement shall continue in effect
for two years from the date of execution, and from year to year thereafter
so long as such continuance is specifically approved at least annually
(i) by the Board of Trustees of the Trust or by vote of a majority of the
outstanding voting securities of the Series, and (ii) by vote of a majority
of the trustees of the Trust who are not interested persons of the Trust,
the Manager or the Sub-Adviser, cast in person at a meeting called for the
purpose of voting on such approval;
b. this Agreement may at any time be terminated on sixty days' written
notice to the Sub-Adviser either by vote of the Board of Trustees of the
Trust or by vote of a majority of the outstanding voting securities of the
Series;
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c. this Agreement shall automatically terminate in the event of its
assignment or upon the termination of the Advisory Agreement; and
d. this Agreement may be terminated by the Sub-Adviser on ninety days'
written notice to the Manager and the Trust, or by the Manager on ninety
days' written notice to the Sub-Adviser.
Termination of this Agreement pursuant to this Section 10 shall be without
the payment of any penalty.
11. Amendment. This Agreement may be amended at any time by mutual consent
of the Manager and the Sub-Adviser, provided that, if required by law, such
amendment shall also have been approved by vote of a majority of the
outstanding voting securities of the Series and by vote of a majority of the
trustees of the Trust who are not interested persons of the Trust, the Manager
or the Sub-Adviser, cast in person at a meeting called for the purpose of
voting on such approval.
12. Certain Definitions. For the purpose of this Agreement, the terms "vote
of a majority of the outstanding voting securities," "interested person,"
"affiliated person" and "assignment" shall have their respective meanings
defined in the 1940 Act, subject, however, to such exemptions as may be granted
by the Securities and Exchange Commission under the 1940 Act.
13. General.
a. The Sub-Adviser may perform its services through any employee, officer
or agent of the Sub-Adviser, and the Manager shall not be entitled to the
advice, recommendation or judgment of any specific person; provided,
however, that the persons identified in the prospectus of the Series shall
perform the day-to-day portfolio management duties described therein until
the Sub-Adviser notifies the Manager that one or more other employees,
officers or agents of the Sub-Adviser, identified in such notice, shall
assume such duties as of a specific date.
b. If any term or provision of this Agreement or the application thereof
to any person or circumstances is held to be invalid or unenforceable to any
extent, the remainder of this Agreement or the application of such provision
to other persons or circumstances shall not be affected thereby and shall be
enforced to the fullest extent permitted by law.
c. In accordance with Regulation S-P, if non-public personal information
regarding either party's customers or consumers is disclosed to the other
party in connection with this Agreement, the party receiving such
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information will not disclose or use that information other than as
necessary to carry out the purposes of this Agreement.
d. This Agreement shall be governed by and interpreted in accordance with
the laws of the Commonwealth of Massachusetts.
IXIS ASSET MANAGEMENT ADVISORS, L.P.
By IXIS Asset Management Distribution Corporation, its general partner
By: /s/ Xxxx X. Xxxxxx
------------------------------
Name: Xxxx X. Xxxxxx
Title: Executive Vice President
XXXXXX, XXXXXX & COMPANY, L.P.
By Xxxxxx, Xxxxxx & Company, Inc., its general partner
By: /s/ Xxxxx Charleston
------------------------------
Name: Xxxxx Charleston
Title: Director
IXIS ADVISOR FUNDS TRUST I
on behalf of its IXIS Income Diversified Portfolio series
By: /s/ Xxxx X. Xxxxxx
------------------------------
Name: Xxxx X. Xxxxxx
Title: President and Chief
Executive Officer
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NOTICE
A copy of the Agreement and Declaration of Trust establishing IXIS Advisor
Funds Trust I (the "Fund") is on file with the Secretary of The Commonwealth of
Massachusetts, and notice is hereby given that this Agreement is executed with
respect to the Fund's IXIS Income Diversified Portfolio series (the "Series")
on behalf of the Fund by officers of the Fund as officers and not individually
and that the obligations of or arising out of this Agreement are not binding
upon any of the trustees, officers or shareholders individually but are binding
only upon the assets and property belonging to the Series.
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