EXHIBIT 23(d)(iv)
SUB-ADVISORY AGREEMENT
XXXXXXX XXXXX ASSET MANAGEMENT, L.P.
THIS SUB-ADVISORY AGREEMENT (the "Agreement") is made as of the 1st
day of July, 2005 among WT Mutual Fund, a Delaware business trust (the "Fund"),
Xxxxxx Square Management Corporation (the "Adviser"), a Delaware corporation,
and Xxxxxxx Xxxxx Asset Management, L.P., a Delaware limited partnership
organized under the laws of the State of Delaware (the "Sub-Adviser").
WHEREAS, the Fund is registered under the Investment Company Act of
1940, as amended (the "1940 Act"), as an open-end management investment company
and offers for public sale several series of shares of beneficial interest, a
series of which is the Wilmington International Strategic Allocation Fund (the
"Portfolio");
WHEREAS, the Adviser acts as the investment adviser for the
Portfolio pursuant to the terms of an Investment Advisory Agreement between the
Fund and the Adviser under which the Adviser is responsible for the coordination
of investment of the Portfolio's assets in portfolio securities; and
WHEREAS, the Adviser is authorized under the Investment Advisory
Agreement to delegate its investment responsibilities to one or more persons or
companies;
NOW THEREFORE, in consideration of the promises and mutual covenants
herein contained, the Fund, the Adviser and the Sub-Adviser agree as follows:
1. APPOINTMENT OF SUB-ADVISER. The Adviser and the Fund hereby appoint and
employ the Sub-Adviser as a discretionary portfolio manager, on the terms and
conditions set forth herein, of those assets of the Portfolio which the Adviser
determines to assign to the Sub-Adviser (those assets being referred to as the
"Portfolio Account"). The Adviser may, from time to time, make additions to and
withdrawals from the Portfolio Account.
The Sub-Adviser acknowledges that the Fund may have one or more other
sub-advisers and that the Adviser shall from time to time determine the portion
of the Fund's assets to be managed by the Sub-Adviser. With respect to the Fund,
the Sub-Adviser shall be responsible only for the Portfolio Account and the
Sub-Adviser shall have no responsibility for, and shall be released from any
liabilities or losses relating to, any other portion(s) or segment(s) of the
Fund.
2. ACCEPTANCE OF APPOINTMENT. The Sub-Adviser accepts its appointment as a
discretionary portfolio manager and agrees to use its professional judgment to
make investment decisions for the Portfolio with respect to the investments of
the Portfolio Account and to implement such decisions on a timely basis in
accordance with the provisions of this Agreement.
3. DELIVERY OF DOCUMENTS. The Adviser has furnished the Sub-Adviser with copies
properly certified or authenticated of each of the following and will promptly
provide the Sub-Adviser with copies properly certified or authenticated of any
amendment or supplement thereto:
a. The Portfolio's Investment Advisory Agreement;
b. The Fund's most recent effective registration statement and financial
statements as filed with the Securities and Exchange Commission;
c. The Fund's Agreement and Declaration of Trust and By-Laws; and
d. Any policies, procedures or instructions adopted or approved by the
Fund's Board of Trustees relating to obligations and services provided by the
Sub-Adviser.
4. PORTFOLIO MANAGEMENT SERVICES OF THE SUB-ADVISER. The Sub-Adviser is hereby
employed and authorized to select portfolio securities for investment by the
Portfolio, to purchase and to sell securities for the Portfolio Account, and
upon making any purchase or sale decision, to place orders for the execution of
such portfolio transactions in accordance with Sections 6 and 7 hereof and
Schedule A hereto (as amended from time to time). In providing portfolio
management services to the Portfolio Account, the Sub-Adviser shall be subject
to and shall conform to such investment restrictions as are set forth in the
1940 Act and the rules thereunder, the Internal Revenue Code, applicable state
securities laws, the supervision and control of the Board of Trustees of the
Fund, such specific instructions as the Board of Trustees may adopt and
communicate to the Sub-Adviser, the investment objective, policies and
restrictions of the Fund applicable to the Portfolio furnished pursuant to
Section 5 of this Agreement, the provisions of Schedule A and Schedule B hereto
and other instructions communicated to the Sub-Adviser by the Adviser. The
Sub-Adviser is not authorized by the Fund to take any action, including the
purchase or sale of securities for the Portfolio Account, in contravention of
any restriction, limitation, objective, policy or instruction described in the
previous sentence. The Sub-Adviser shall maintain on behalf of the Fund the
records listed in Schedule B hereto (as amended from time to time). At the
Fund's reasonable request, the Sub-Adviser will consult with the Fund or with
the Adviser with respect to any decision made by it with respect to the
investments of the Portfolio Account.
5. INVESTMENT OBJECTIVE, POLICIES AND RESTRICTIONS. The Fund will provide the
Sub-Adviser with the statement of investment objective, policies and
restrictions applicable to the Portfolio as contained in the Portfolio's
Prospectus and Statement of Additional Information, all amendments or
supplements to the Prospectus and Statement of Additional Information, and any
instructions adopted by the Board of Trustees supplemental thereto. The Fund
agrees, on an ongoing basis, to notify the Sub-Adviser in writing of each change
in the fundamental and non-fundamental investment policies of the Portfolio and
will provide the Sub-Adviser with such further information concerning the
investment objective, policies, restrictions and such other information
applicable thereto as the Sub-Adviser may from time to time reasonably request
for performance of its obligations under this Agreement. The Fund retains the
right, on written notice to the Sub-Adviser or the Adviser, to modify any such
objective, policies or restrictions in accordance with applicable laws, at any
time.
6. TRANSACTION PROCEDURES. All transactions will be consummated by payment to or
delivery by the custodian designated by the Fund (the "Custodian"), or such
depositories or agents as may be designated by the Custodian in writing, of all
cash and/or securities due to or from the Portfolio Account, and the Sub-Adviser
shall not have possession or custody thereof. The Sub-Adviser shall advise the
Custodian and confirm in writing to the Fund and to the administrator designated
by the Fund or any other designated agent of the Fund, all investment
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orders for the Portfolio Account placed by it with brokers and dealers and, to
the extent applicable, Futures Commission Merchants ("FCM") at the time and in
the manner set forth in Schedule A hereto (as amended from time to time). The
Fund shall issue to the Custodian such instructions as may be appropriate in
connection with the settlement of any transaction initiated by the Sub-Adviser.
The Fund shall be responsible for all custodial arrangements and the payment of
all custodial charges and fees, and, upon giving proper instructions to the
Custodian, the Sub-Adviser shall have no responsibility or liability with
respect to custodial arrangements or the acts, omissions or other conduct of the
Custodian, except that it shall be the responsibility of the Sub-Adviser to take
appropriate action if the Custodian fails to confirm in writing proper execution
of the instructions.
7. ALLOCATION OF BROKERAGE. The Sub-Adviser shall have authority and discretion
to select brokers and dealers (including brokers that may be affiliates of the
Sub-Adviser to the extent permitted by Section 7(c) hereof) to execute portfolio
transactions initiated by the Sub-Adviser, and for the selection of the markets
on or in which the transactions will be executed, subject to the following and
subject to conformance with the policies and procedures disclosed in the Fund's
Prospectus and Statement of Additional Information and the policies and
procedures adopted by the Fund's Board of Trustees provided that with respect to
procedures governing transactions involving affiliates such as those adopted
pursuant to the 1940 Act. Rule 17a-7, Rule 17e-1 and Rule 10f-3, such procedures
will identify any affiliate of the Adviser and the Portfolio, other than
affiliates of the Sub-Adviser. The Sub-Advisor shall not bear any responsibility
and shall be released from any loss or cost which results from entering into a
trade pursuant to the Portfolio's Rule 17a-7, 17e-1 or 10f-3 procedures with any
affiliated entity, other than affiliates of the Sub-Advisor, not specifically
identified to the Sub-Advisor by the Advisor.
a. In executing portfolio transactions, the Sub-Adviser will give primary
consideration to securing the best execution. Consistent with this policy, the
Sub-Adviser may consider the financial responsibility, research and investment
information and other services provided by brokers or dealers who may effect or
be a party to any such transaction or other transactions to which other clients
of the Sub-Adviser may be a party. It is understood that neither the Fund, the
Adviser nor the Sub-Adviser has adopted a formula for allocation of the Fund's
investment transaction business. It is also understood that it is desirable for
the Fund that the Sub-Adviser have access to supplemental investment and market
research and security and economic analyses provided by certain brokers who may
execute brokerage transactions at a higher commission to the Fund than may
result when allocating brokerage to other brokers on the basis of seeking the
lowest commission. Therefore, the Sub-Adviser is authorized to place orders for
the purchase and sale of securities for the Portfolio with certain such brokers,
subject to review by the Fund's Board of Trustees from time to time with respect
to the extent and continuation of this practice. It is understood that the
services provided by such brokers may be useful to the Sub-Adviser in connection
with its services to other clients of the Sub-Adviser. The Sub-Adviser is also
authorized to place orders with certain brokers for services deemed by the
Adviser to be beneficial for the Fund; and the Sub-Adviser shall follow the
directions of the Adviser or the Fund in this regard.
b. On occasions when the Sub-Adviser deems the purchase or sale of a
security to be in the best interest of the Portfolio as well as other clients of
the Sub-Adviser, the Sub-Adviser,
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to the extent permitted by applicable laws and regulations, may, but shall be
under no obligation to, aggregate the securities to be sold or purchased in
order to obtain the best execution. In such event, allocation of the securities
so purchased or sold, as well as expenses incurred in the transaction, will be
made by the Sub-Adviser in the manner it considers to be equitable and
consistent with its fiduciary obligations to the Fund in respect of the
Portfolio and to such other clients.
c. The Sub-Adviser may engage in agency transactions with any of its
affiliated broker-dealers subject to best execution, in accordance with Section
11(a) of the Securities Exchange Act and Rule 11a2-2(T) thereunder. The
Sub-Adviser further agrees that it will not execute any portfolio transactions
for the Portfolio Account with any other broker or dealer which is (i) an
affiliated person of the Fund, the Adviser or any other sub-adviser for any
Portfolio of the Fund; (ii) a principal underwriter of the Fund's shares; or
(iii) an affiliated person of such an affiliated person or principal
underwriter, unless such transactions are (x) exempt under Rules 10f-3(b) or
17a-10, (y) executed in accordance with Rule 17e-1 of the 1940 Act and the
Fund's Rule 17e-1 procedures, as adopted in accordance with Rule 17e-1 or (z)
executed in accordance with Rule 10f-3(c) of the 1940 and the Fund's Rule
10f-3(c) procedures, as adopted in accordance with Rule 10f-3. The Adviser
agrees that it will provide the Sub-Adviser with a list of such affiliated
brokers and dealers.
d. The Sub-Adviser acknowledges and agrees that in connection with the
exemptions provided under Rules 10f-3(b), 12d3-1, and 17a-10 under the 1940 Act,
the Sub-Adviser (i) will not consult with any other sub-adviser of the
Portfolio, which is advising the Portfolio, concerning the Sub-Adviser or its
affiliated persons' transactions with the Portfolio in securities or other
assets of the Portfolio, and (ii) will be limited to providing investment advice
with respect to the Portfolio Account.
e. The Adviser hereby agrees and consents that the Sub-Adviser and its
affiliates are authorized to execute agency cross transactions (collectively
"Cross transactions") for the Portfolio provided such transactions comply with
Rule 206(3)-2 under the Investment Advisers Act of 1940 ("Advisers Act"), Rule
17e-1 under the 1940 Act and any other applicable laws or regulations. Cross
transactions are transactions which may be effected by the Sub-Adviser or its
affiliates acting as broker for both the Portfolio and the counterparty to the
transaction. Cross transactions enable the Sub-Adviser to purchase or sell a
block of securities for an account at a set price and possibly avoid an
unfavorable price movement that may be created through entrance into the market
with such purchase or sell order. However, the Adviser should note that the
Sub-Adviser has a potentially conflicting division of loyalties and
responsibilities regarding both parties to Cross transactions and that the
Sub-Adviser, or any of its affiliates, if acting as broker; may receive
commissions from both parties to such transactions. The Sub-Adviser acknowledges
that it is prohibited from recommending any Cross transactions to its advisory
clients on both sides of the transaction and understands that its authority as
the Sub-Adviser to execute Cross transactions for the Account is terminable at
will without penalty, effective upon receipt by the Sub-Adviser of written
notice from the Adviser, and that the failure to terminate such authorization
will result in its continuation.
f. In connection with any Cross transactions, the Sub-Adviser will provide
the Portfolio with a confirming letter describing the details of such trades,
and other reports or
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information that the Portfolio may reasonably request. The Sub-Adviser will
disclose to the Portfolio the commissions received by the Sub-Adviser or its
affiliates for executing the other side of the transaction.
8. PROXIES. The Sub-Adviser will vote all proxies solicited by or with respect
to issuers of securities in which assets of the Portfolio Account may be
invested from time to time consistent with the Sub-Adviser's proxy voting
guidelines and procedures, as submitted to the Board of Trustees for review from
time to time.
9. REPORTS TO THE SUB-ADVISER. The Fund will provide the Sub-Adviser with such
periodic reports concerning the status of the Portfolio Account as the
Sub-Adviser may reasonably request.
10. FEES FOR SERVICES. For the services rendered, the Sub-Adviser shall be paid
an annual fee of 0.50% of the average daily net assets of the Portfolio Account.
The fee shall be payable monthly as soon as practicable after the last day of
each month based on the Portfolio Account's average daily net assets.
11. OTHER INVESTMENT ACTIVITIES OF THE SUB-ADVISER. The Adviser understands that
the Sub-Adviser is part of a worldwide, full service investment banking,
broker-dealer, asset management organization, and as such, the Sub-Adviser and
its affiliates and their managing directors, directors, officers and employees
have multiple advisory, transactional and financial and other interests as more
fully described in the Sub-Adviser 's Form ADV, Part II. The Adviser understands
that the Sub-Adviser's affiliates offer a broad range of brokerage and
investment banking services, that the employees of the Sub-Adviser and its
affiliates may from time to time act as directors, officers, or employees of
companies whose securities are publicly traded, and that as a result, such
employees may acquire information of a confidential nature. The Adviser agrees
that the Sub-Adviser may, but shall not be required to, render investment advice
with respect to any such company, and that the Sub-Adviser may in its discretion
withhold any such knowledge or information or refuse to advise with respect to
such company, whether or not the Portfolio Account shall include securities of
such company, if in the Sub-Adviser's judgment the disclosure of such knowledge
or information or the rendering of investment advice on the basis thereof would
be unfair, inequitable, a breach of any fiduciary obligation of the Sub-Adviser
to some other person, or unlawful. For the same reasons, the Sub-Adviser may, in
its discretion, exclude securities and other property from the Portfolio
Account, and the Sub-Adviser shall not be required to give advice on securities
and other property which it or its affiliates have distributed, are distributing
or propose to distribute. The Sub-Adviser and any affiliated parties may give
advice and take action in the performance of their duties with respect to any of
their clients which may differ from advice given, or the timing or nature of
action taken, with respect to the Fund. Nothing in this Agreement shall be
deemed to impose upon the Sub-Adviser or any affiliated parties any obligation
to purchase or sell or to recommend for purchase or sale for the Fund any
security or other property which the Sub-Adviser or any affiliated parties may
purchase or sell for their own account or for the account of any other client,
if in the Sub-Adviser's sole discretion, such action or such recommendation is
undesirable or impractical for the Fund. Nothing in this Agreement shall limit
or restrict the Sub-Adviser or any affiliated parties from trading for their own
account. The Sub-Adviser or any affiliated parties or other clients may have or
trade in investments which are at the same time being traded
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for the Fund. The Sub-Adviser shall have no obligation to acquire for the Fund a
position which the Sub-Adviser or any affiliated parties may acquire for their
own or the account of another client, so long as it continues to be the policy
and practice of the Sub-Adviser not to favor or disfavor any client or class of
clients in the allocation of investment opportunities.
12. CERTIFICATE OF AUTHORITY. The Fund, the Adviser and the Sub-Adviser shall
furnish to each other from time to time certified copies of the resolutions of
their Boards of Trustees/Directors or executive committees, as the case may be,
evidencing the authority of officers and employees who are authorized to act on
behalf of the Fund, the Portfolio Account, the Adviser and/or the Sub-Adviser.
13. LIMITATION OF LIABILITY. The Sub-Adviser shall not be liable for any action
taken, omitted or suffered to be taken by it in its reasonable judgment, in good
faith and believed by it to be authorized or within the discretion or rights or
powers conferred upon it by this Agreement, or in accordance with (or in the
absence of) specific directions or instructions from the Fund or the Adviser,
provided, however, that such acts or omissions shall not have resulted from the
Sub-Adviser's willful misfeasance, bad faith, gross negligence or a reckless
disregard of duty. Nothing in this Section 13 shall be construed in a manner
inconsistent with Section 17(i) of the 1940 Act.
14. CONFIDENTIALITY. Subject to the duty of the Sub-Adviser, the Adviser and the
Fund to comply with applicable law, including any demand of any regulatory or
taxing authority having jurisdiction, the parties hereto shall treat as
confidential all material non-public information pertaining to the Portfolio
Account and the actions of the Sub-Adviser, the Adviser and the Fund in respect
thereof.
15. ASSIGNMENT. This Agreement shall terminate automatically in the event of its
assignment. The Sub-Adviser shall notify the Fund and the Adviser in writing
sufficiently in advance of any proposed change of control within the meaning of
the 1940 Act to enable the Fund and the Adviser to take the steps necessary to
enter into a new contract with the Sub-Adviser.
16. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE FUND. The Fund represents,
warrants and agrees that:
a. The Sub-Adviser has been duly appointed by the Board of Trustees of the
Fund to provide investment services to the Portfolio Account as contemplated
hereby.
b. The Fund will deliver to the Sub-Adviser a true and complete copy of
its then current Prospectus and Statement of Additional Information as effective
from time to time and such other documents or instruments governing the
investment of the Portfolio Account and such other information as is necessary
for the Sub-Adviser to carry out its obligations under this Agreement.
c. The Fund is currently in compliance and shall continue to comply with
the material requirements imposed upon the Fund by applicable law and
regulations.
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17. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE ADVISER. The Adviser
represents, warrants and agrees that:
a. The Adviser has been duly authorized by the Board of Trustees of the
Fund to delegate to the Sub-Adviser the provision of investment services to the
Portfolio Account as contemplated hereby.
b. The Adviser is currently in compliance and shall continue to comply
with the requirements imposed upon the Adviser by applicable law and
regulations.
c. The Adviser is registered as an "investment adviser" under the
Investment Advisers Act of 1940 ("Advisers Act") and will continue to be so
registered for so long as this Agreement remains in effect.
d. The Fund and the Advisor acknowledge and agree that the Sub-Advisor
shall have no supervisory responsibilities with respect to any anti-money
laundering program or efforts on behalf of the Fund or the Portfolio.
e. The Adviser has the authority to enter into and perform the services
contemplated by this Agreement and will promptly notify the Sub-Adviser of the
occurrence of any event that would disqualify it from serving as an investment
adviser of any investment company pursuant to Section 9(a) of the 1940 Act or
otherwise.
f. The Adviser represents and warrants that the Fund is duly registered as
an open-end investment company under the 1940 Act and shall promptly notify the
Sub-Adviser if the Fund is no longer so registered or covered by an applicable
exemption from registration.
18. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE SUB-ADVISER. The
Sub-Adviser represents, warrants and agrees that:
a. The Sub-Adviser is registered as an "investment adviser" under the
Advisers Act and has the authority to enter into and perform the services
contemplated by this Agreement.
The Sub-Adviser is currently in compliance and shall continue to
comply with the requirements imposed upon the Sub-Adviser by applicable law and
regulations.
b. The Sub-Adviser will maintain, keep current and preserve on behalf of
the Fund, in the manner required or permitted by the 1940 Act, the records
identified in Schedule B. The Sub-Adviser agrees that such records (unless
otherwise indicated on Schedule B) are the property of the Fund, and will be
surrendered to the Fund promptly upon request. The Sub-Adviser agrees to keep
confidential all records of the Fund and information relating to the Fund,
unless the release of such records or information is otherwise consented to in
writing by the Fund or the Adviser. The Fund and the Adviser agree that such
consent shall not be unreasonably withheld and may not be withheld where the
Sub-Adviser may be exposed to civil or criminal contempt proceedings or when
required to divulge such information or records to duly constituted authorities.
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c. The Sub-Adviser will complete such reports concerning purchases or
sales of securities on behalf of the Portfolio Account as the Adviser or the
Fund may from time to time require to ensure compliance with the 1940 Act, the
Internal Revenue Code, applicable state securities laws and applicable statutes
and regulations of foreign jurisdictions.
d. The Sub-Adviser has adopted a written code of ethics complying with the
requirements of Rule 17j-1 under the 1940 Act and Section 204A of the Advisers
Act and has provided the Fund with a copy of the code of ethics and evidence of
its adoption. Within forty-five (45) days of the end of the last calendar
quarter of each year while this Agreement is in effect or upon the written
request of the Adviser, the president or a vice president or general partner of
the Sub-Adviser shall certify to the Fund that the Sub-Adviser has complied with
the requirements of Rule 17j-1 and Section 204A during the previous year and
that there has been no violation of the Sub-Adviser's code of ethics or, if such
a violation has occurred, that appropriate action was taken in response to such
violation. Upon the written request of the Fund, the Sub-Adviser shall permit
the Fund, its employees or its agents to examine the reports required to be made
to the Sub-Adviser by Rule 17j-1(d)(1).
e. The Sub-Adviser will, promptly after filing with the Securities and
Exchange Commission an amendment to its Form ADV that materially impacts the
Sub-Adviser's policies, procedures or personnel related to its duties hereunder,
furnish a copy of such amendment to the Fund and the Adviser.
f. The Sub-Adviser will promptly notify the Fund and the Adviser of the
occurrence of any event which would disqualify the Sub-Adviser from serving as
an investment adviser of an investment company pursuant to Section 9 of the 1940
Act or otherwise. The Sub-Adviser will also immediately notify the Fund and the
Adviser if it 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, involving the affairs of the Portfolio.
19. USE OF XXXXXXX XXXXX NAME. It is understood that the name "Xxxxxxx, Sachs &
Co." or "Xxxxxxx Xxxxx" or any derivative thereof, any trade name, trademark,
trade device, service xxxx, symbol or logo associated with those names are the
valuable property of the Sub-Adviser and that the Adviser has the right to use
such names (or derivative or logo), in offering materials or promotional or
sales-related materials of the Portfolio, only with the prior written approval
of the Sub-Adviser and for so long as the Sub-Adviser is Sub-Adviser of the
Portfolio. Notwithstanding the foregoing, the Sub-Adviser's approval is not
required when (i) previously approved materials are re-issued with minor
modifications, or (ii) the Adviser and Sub-Adviser identify materials which they
jointly determine do not require the Sub-Adviser's approval. Upon termination of
this Agreement, the Portfolio and the Adviser shall forthwith cease to use such
name (or derivative or logo).
20. TAX COMPLIANCE TESTS. The Adviser shall be responsible for performing tax
compliance testing to monitor that the Portfolio is in compliance with
subchapter M of the Internal Revenue Code.
21. INDEMNIFICATION. The Adviser agrees to indemnify and hold harmless the
Sub-Adviser and its officers, directors, agents and employees from any losses,
claims, damages, liabilities or
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litigation (including reasonable legal and other related expenses) incurred by
the Sub-Adviser that (i) are based upon any willful misfeasance, bad faith or
gross negligence by the Adviser (other than Sub-Adviser or its employees); or
(ii) are based upon any untrue statement or alleged untrue statement of a
material fact contained in the registration statement, prospectus covering
shares of the Portfolio, Fund marketing materials and advertising, or any
amendment thereof or any supplement thereto, or the omission or alleged omission
to state therein a material fact required to be stated therein or necessary to
make the statement therein not misleading, unless such statement or omission was
made in reliance upon written information furnished to the Portfolio or the
Adviser or any affiliated person of the Adviser by the Sub-Adviser or any
affiliated person of the Sub-Adviser which itself is materially misleading; and
further provided, however, that the Adviser's obligation under this Paragraph 21
shall be reduced to the extent that the claim against, or the loss, liability,
damage or litigation experienced by the Sub-Adviser, is caused by or is
otherwise directly related to the Sub-Adviser's own willful misfeasance, bad
faith or gross negligence.
The Sub-Adviser shall indemnify and hold harmless the Adviser and its officers,
directors, agents and employees from and against any and all claims, losses,
liabilities, damages or litigation (including reasonable attorney's fees and
other related expenses) incurred by the Adviser that are based upon the willful
misfeasance, bad faith, gross negligence or material breach of this Agreement by
the Sub-Adviser, provided, however, that the Sub-Adviser's obligation under this
Paragraph 21 shall be reduced to the extent that the claim against, or the loss,
liability, damage or litigation experienced by the Adviser, is caused by or is
otherwise directly related to the Adviser's own willful misfeasance, bad faith
or gross negligence.
Without limitation, the Sub-Adviser shall not have breached any obligation to
the Adviser and shall incur no liability for losses resulting from (i) the
actions of either the Advisor or the Fund's previous sub-advisor or from
following, in accordance with the standards set forth in this Agreement, the
directions of the Adviser, or the Sub-Advisers' failure to follow unlawful
directions of the Adviser; (ii) any act or omission of any other sub-advisers to
the Fund; or (iii) a force majeure or other events beyond the control of the
Sub-Adviser, including without limitation any failure, default or delay in
performance resulting from computer failure or a breakdown in communications not
reasonably within the control of the Sub-Adviser. No warranty is given by the
Sub-Adviser as to the performance or profitability of the Fund or any part
thereof or that the investment objectives of the Fund, including without
limitation its risk control or return objectives, will be successfully
accomplished and the Sub-Adviser shall have no liability in respect of any
losses arising as a result of any failure to achieve such objectives absent
willful misfeasance, bad faith or gross negligence.
The provisions of this Paragraph 21 shall survive termination of this Agreement.
22. AMENDMENT. This Agreement may be amended at any time, but only by written
agreement among the Sub-Adviser, the Adviser and the Fund, which amendment,
other than amendments to Schedule A and Schedule B, is subject to the approval
of the Board of Trustees and, to the extent required by the 1940 Act, the
shareholders of the Portfolio in the manner required by the 1940 Act and the
rules thereunder, subject to any applicable orders of exemption issued by the
Securities and Exchange Commission.
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23. EFFECTIVE DATE; TERM. This Agreement shall become effective on the date
first written above and shall remain in force for a period of time of two years
from such date, and from year to year thereafter but only so long as such
continuance is specifically approved at least annually by the vote of a majority
of the Trustees who are not interested persons of the Fund, the Adviser or the
Sub-Adviser, cast in person at a meeting called for the purpose of voting on
such approval, and by a vote of the Board of Trustees or of a majority of the
outstanding voting securities of the Portfolio. The aforesaid requirement that
this Agreement may be continued "annually" shall be construed in a manner
consistent with the 1940 Act and the rules and regulations thereunder.
24. TERMINATION.
a. This Agreement may be terminated at any time by the Fund (by a vote of
the Board of Trustees of the Fund or by a vote of a majority of the outstanding
voting securities of the Portfolio), without the payment of any penalty,
immediately upon written notice to the other parties hereto, in the event of a
material breach of any provision thereof by the party so notified or otherwise
by the Fund, upon sixty (60) days' written notice to the other parties hereto,
but any such termination shall not affect the status, obligations or liabilities
of any party hereto to the others.
b. This Agreement may also be terminated by the Adviser or the
Sub-Adviser, without the payment of any penalty immediately upon written notice
to the other parties hereto, in the event of a material breach of any provision
thereof by the party so notified if such breach shall not have been cured within
a 20-day period after notice of such breach or otherwise by the Adviser or the
Sub-Adviser upon sixty (60) days' written notice to the other parties hereto,
but any such termination shall not affect the status, obligations or liabilities
of any party hereto to the others.
25. DEFINITIONS. As used in this Agreement, the terms "affiliated person,"
"assignment," "control," "interested person," "principal underwriter" and "vote
of a majority of the outstanding voting securities" shall have the meanings set
forth in the 1940 Act and the rules and regulations thereunder, subject to any
applicable orders of exemption issued by the Securities and Exchange Commission.
26. NOTICE. Any notice under this Agreement shall be given in writing addressed
and delivered or mailed, postage prepaid, to the other parties to this Agreement
at their principal place of business.
27. 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.
28. GOVERNING LAW. To the extent that state law is not preempted by the
provisions of any law of the United States heretofore or hereafter enacted, as
the same may be amended from time to time, this Agreement shall be administered,
construed and enforced according to the laws of the State of Delaware.
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29. ENTIRE AGREEMENT. This Agreement and the Schedules attached hereto embodies
the entire agreement and understanding between the parties.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed, as of the day and year first written above.
WT Mutual Fund
on behalf of the Wilmington International Strategic
Allocation Fund
By: _______________________________________________
Name:
Title:
Xxxxxxx Xxxxx Asset Management, L.P.
By: _______________________________________________
Name:
Title:
Xxxxxx Square Management Corporation
By: ______________________________________________
Name:
Title:
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SCHEDULE A
OPERATING PROCEDURES
From time to time the Adviser shall issue written Operating Procedures which
shall govern reporting of transactions and other matters so as to facilitate (i)
the monitoring of the Fund's compliance with the restrictions and limitations
applicable to the operations of a registered investment company and (ii) the
preparation of reports to the Board of Trustees, regulatory authorities and
shareholders.
SUBSTANTIVE LIMITATIONS
1. The Sub-Adviser will manage the Portfolio Account as if the Portfolio Account
were a registered investment company subject to the investment objective,
policies and limitations applicable to the Portfolio stated in the Fund's
Prospectus and Statement of Additional Information, as from time to time in
effect, included in the Fund's registration statement or a supplement thereto
under the Securities Act of 1933 and the Investment Company Act of 1940 (the
"1940 Act"), as each may be amended from time to time; provided, however, that
if a more stringent restriction or limitation than any of the foregoing is
stated in Section 2 of this Schedule, the more stringent restriction or
limitation shall apply to the Portfolio Account.
2. The Sub-Adviser shall not, without the written approval of the Adviser, on
behalf of the Portfolio Account:
a. purchase securities of any issuer if such purchase would cause more
than 10% of the voting securities of such issuer to be held in the Portfolio
Account (1940 Act Section 5(b)(1); IRC* Section 851(b)(4)(a)(ii));
b. purchase securities if such purchase would cause:
i. more than 3% of the outstanding voting stock of any other
investment company to be held in the Portfolio Account (1940 Act
Section 12(d)(1)(A)(i)),
ii. securities issued by any other investment company having an
aggregate value in excess of 5 % of the value of the total assets in the
Portfolio Account to be held in the Portfolio Account (1940 Act
Section 12(d)(1)(A)(ii)),
iii. securities issued by all other investment companies (other than
Treasury Stock) having an aggregate value in excess of 10% of the value of the
total assets of the Portfolio Account to be held in the Portfolio Account (1940
Act Section 12(d)(1)(A)(iii)),
iv. more than 10% of the outstanding voting stock of any registered
closed-end investment company to be held in the Portfolio Account, and by any
other investment
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* Internal Revenue Code
A-1
company having as its investment adviser any of the Sub-Advisers, the Adviser,
or any other investment adviser to the Fund (1940 Act Section 12(d)(1)(C));
c. purchase securities of any insurance company if such purchase would
cause more than 10% of the outstanding voting securities of any insurance
company to be held in the Portfolio Account (1940 Act Section 12(d)(2)); or
d. purchase securities of or any interest in any person who is a broker, a
dealer, is engaged in the business of underwriting, is an investment adviser to
an investment company or is a registered investment adviser under the Investment
Advisers Act of 1940 unless
i. such purchase is of a security of any issuer that, in its most
recent fiscal year, derived 15% or less of its gross revenues from
securities-related activities (1940 Act Rule 12d3-l(a)), or
ii. despite the fact that such purchase is of any security of any
issuer that derived more than 15% of its gross revenues from securities-related
activities:
(1) immediately after the purchase of any equity security, the
Portfolio Account would not own more than 5% of outstanding securities of that
class of the issuer's equity securities (1940 Act Rule 12d3-1(b)(1));
(2) immediately after the purchase of any debt security, the
Portfolio Account would not own more than 10% of the outstanding principal
amount of the issuer's debt securities (1940 Act Rule 12d3-1(b)(2)); and
(3) immediately after the purchase, not more than 5% of the
value of the Portfolio Account's total assets would be invested in the issuer's
securities (1940 Act Rule 12d3-1(b)(3)).
3. The Sub-Adviser will manage the Portfolio Account so that no more than 10% of
the gross income of the Portfolio Account is derived from any source other than
dividends, interest, payments with respect to securities loans (as defined in
IRC Section 512(a)(5)), and gains from the sale or other disposition of stock or
securities (as defined in the 1940 Act Section 2(a)(36)) or foreign currencies,
or other income (including, but not limited to, gains from options, futures, or
forward contracts) derived with respect to the Portfolio's business of investing
in such stock, securities, or currencies (IRC Section 851(b)(2)).
A-2
SCHEDULE B
RECORD KEEPING REQUIREMENTS
Records To Be Maintained by the Sub-Adviser:
1. (Rule 31a-l(b)(5) and (6)). A record of each brokerage order, and all other
portfolio purchases and sales, given by the Sub-Adviser on behalf of the
Portfolio Account for, or in connection with, the purchase or sale of
securities, whether executed or unexecuted. Such records shall include:
a. the name of the broker;
b. the terms and conditions of the order and of any modification or
cancellation thereof;
c. the time of entry or cancellation;
d. the price at which executed;
e. the time of receipt of a report of execution; and
f. the name of the person who placed the order on behalf of the Portfolio
Account.
2. (Rule 31a-l(b)(9)). A record for each fiscal quarter, completed within ten
(10) days after the end of the quarter, showing specifically the basis or bases
(e.g. execution ability, execution and research) upon which the allocation of
orders for the purchase and sale of portfolio securities to named brokers or
dealers was effected, and the division of brokerage commissions or other
compensation on such purchase and sale orders. Such record:
a. shall include the consideration given to:
i. the sale of shares of the Fund by brokers or dealers;
ii. the supplying of services or benefits by brokers or dealers to:
(1) the Fund,
(2) the Adviser,
(3) the Sub-Adviser, and
(4) any person other than the foregoing; and
iii. any other consideration other than the technical qualifications
of the brokers and dealers as such;
b. shall show the nature of the services or benefits made available;
B-1
c. shall describe in detail the application of any general or specific
formula or other determinant used in arriving at such allocation of purchase and
sale orders and such division of brokerage commissions or other compensation;
and
d. shall show the name of the person responsible for making the
determination of such allocation and such division of brokerage commissions or
other compensation.
3. (Rule 31a-l(b)(10)). A record in the form of an appropriate memorandum
identifying the person or persons, committees or groups authorizing the purchase
or sale of portfolio securities. Where an authorization is made by a committee
or group, a record shall be kept of the names of its members who participate in
the authorization. There shall be retained as part of this record: any
memorandum, recommendation or instruction supporting or authorizing the purchase
or sale of portfolio securities and such other information as is appropriate to
support the authorization.*
4. (Rule 31a-1(f)). Such accounts, books and other documents as are required to
be maintained by registered investment advisers by rule adopted under Section
204 of the Investment Advisers Act of 1940, to the extent such records are
necessary or appropriate to record the Sub-Adviser's transactions with respect
to the Portfolio Account.
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* Such information might include: the current Form 10-K, annual and quarterly
reports, press releases, reports by analysts and from brokerage firms (including
their recommendations, i.e., buy, sell and hold) or any internal reports or
portfolio adviser reviews.
B-2
