WORLD FUNDS TRUST SUB-ADVISORY AGREEMENT
SUB-ADVISORY AGREEMENT
Investment Sub-Advisory Agreement (the "Agreement") dated this 4th day of April, 2011 by and between Union Street Partners, LLC, a Delaware limited liability company (the "Adviser"), a registered investment adviser under the Investment Advisers Act of 1940, as amended, and XxXxxx Investment Management, Inc. (the "Sub-Adviser"), a registered investment adviser under the Investment Advisers Act of 1940, as amended.
WHEREAS, the World Funds Trust (the "Trust") is registered as an open-end management investment company under the Investment Company Act of 1940, as amended (the "1940 Act"), and consists of one or more series of shares, each having its own investment objective and policies and each with one or more separate classes of shares;
WHEREAS, the Trust has retained the Adviser to furnish investment advisory and management services to the Union Street Partners Value Fund, a series of the Trust (the "Fund"), subject to the control of the Trust’s Board of Trustees (the “Board” or the “Trustees”), and the Adviser is willing to so furnish such services; and
WHEREAS, the Adviser desires to retain the Sub-Adviser to assist it in furnishing investment advisory and management services to the Fund, subject to the control of the Adviser, and the Sub-Adviser is willing to so furnish such services;
NOW, THEREFORE, in consideration of the premises and mutual covenants herein contained, and intending to be bound, it is agreed between the parties hereto as follows:
| 1. |
Appointment. The Adviser, as permitted by the investment advisory
agreement by and between the Trust and the Adviser, hereby appoints the Sub-Adviser
to act as the sub-adviser to the Fund for the period and on the terms set forth
in this Agreement. The Sub-Adviser accepts such appointment and agrees to furnish
the services herein set forth, for the compensation herein provided. |
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| 2. | Duties of the Sub-Adviser. Subject to the supervision of
the Adviser, the Sub-Adviser will assist the Adviser in managing the investment
and reinvestment of the assets of the Fund, and will continuously review, supervise,
and administer the investment program of the Fund, to determine in its discretion
the securities to be purchased or sold, to provide the Trust and Commonwealth Shareholder
Services, Inc. (the "Administrator") with records concerning the Sub-Adviser’s
activities which the Trust is required to maintain, and to render regular reports
to the Adviser, the Trust’s officers and Board and to the Administrator, concerning
the Sub-Adviser’s discharge of the foregoing responsibilities. |
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The Sub-Adviser
shall discharge the foregoing responsibilities subject to the control of the Adviser
and the Trust’s Board and in compliance with such policies as the Board may
from time to time establish, and in compliance with the objectives, policies and
limitations for the Fund as set forth in the Fund’s prospectus and statement
of additional information, as amended from |
time to time, and applicable laws and
regulations. The Trust will instruct each of its agents and contractors to cooperate
in the conduct of the business of the Fund. |
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The Sub-Adviser
accepts such employment and agrees, at its own expense, to render the services and
to provide the office space, furnishings, and equipment and the personnel required
by it to perform the services on the terms and for the compensation provided herein. |
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| 3. |
Portfolio Transactions. The Sub-Adviser is authorized to
select the brokers and dealers that will execute the purchases and sales of portfolio
securities for the Fund and is directed to use its best efforts to obtain the best
price and execution for the Fund’s transactions in accordance with the policies
of the Trust as set forth from time to time in the Fund’s prospectus and Statement
of Additional Information. The Sub-Adviser will promptly communicate to the Trust
and to the Administrator such information relating to portfolio transactions as
they may reasonably request. |
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It is understood
that the Sub-Adviser will not be deemed to have acted unlawfully, or to have breached
a fiduciary duty to the Trust or be in breach of any obligation owing to the Trust
under this Agreement, or otherwise, by reason of its having directed a securities
transaction on behalf of the Trust to an unaffiliated broker-dealer in compliance
with the provisions of Section 28(e) of the Securities Exchange Act of 1934 or as
described from time to time by the Fund’s prospectus and statement of additional
information. Subject to the foregoing, the Sub-Adviser may direct any transaction
of the Fund to a broker which is affiliated with the Adviser or Sub-Adviser in accordance
with, and subject to, the policies and procedures approved by the Board pursuant
to Rule 17e-1 under the 1940 Act. Such brokerage services are not deemed to be provided
under this Agreement. |
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| 4. |
Compensation of the Sub Adviser. For the services to be
rendered by the Sub-Adviser under this Agreement, the Adviser shall pay to the Sub-Adviser
compensation at the rate specified in Schedule A attached hereto and made a part
of this Agreement. Such compensation shall be paid monthly to the Sub-Adviser and
calculated by applying a daily rate, based on the annual percentage rates as specified
in the attached Schedule, to the assets. The fee shall be based on the average daily
net assets for the month involved. |
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All rights
of compensation under this Agreement for services performed as of the termination
date shall survive the termination of this Agreement. |
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| 5. |
Expenses. During the term of this Agreement, the Sub-Adviser
will pay all expenses incurred by it in connection with its activities under this
Agreement other than the cost of securities, commodities and other investments (including
brokerage commissions and other transaction charges, if any) purchased for the Fund. |
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| 6. |
Reports. The Sub-Adviser agrees to furnish to the Adviser
and the Trust current information required for the preparation by such parties of
prospectuses, statements of additional information, proxy statements, reports to
shareholders, certified copies of the Fund’s financial statements, and to furnish
such other information and documents with regard to its affairs as each may reasonably
request. |
| 7. |
Status of the Sub-Adviser. The services of the Sub-Adviser
to the Adviser and to the Trust are not to be deemed exclusive, and the Sub-Adviser
shall be free to render similar services to others so long as its services to the
Adviser and to the Trust are not impaired thereby. |
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Pursuant to
comparable agreements, the Adviser and/or the Trust may also retain the services
of the Sub-Adviser to serve as the investment adviser or sub-adviser to other series
of the Trust. |
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| 8. |
Books and Records. In compliance with the requirements
of the 1940 Act, the Sub-Adviser hereby agrees that all records which it maintains
for the Trust are the property of the Trust, and further agrees to surrender promptly
to the Trust any of such records upon the Trust’s request. The Sub-Adviser
further agrees to preserve for the periods prescribed by the 1940 Act, and the rules
or orders there under, the records required to be maintained by the 1940 Act. |
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| 9. |
Limitation of Liability of Sub-Adviser. The duties of the
Sub-Adviser shall be confined to those expressly set forth herein, and no implied
duties are assumed by or may be asserted against the Sub-Adviser hereunder. The
Sub-Adviser shall not be liable for any error of judgment or mistake of law or for
any loss suffered by the Trust or the Adviser in connection with the performance
of this Agreement, except a loss resulting from a breach of fiduciary duty with
respect to the receipt of compensation for services or a loss resulting from willful
misfeasance, bad faith or negligence on the part of the Sub-Adviser in the performance
of its duties or from reckless disregard by it of its obligations and duties under
this Agreement (as used in this paragraph 9, the term "Sub-Adviser" shall include
directors, officers, employees and other corporate agents of the Sub-Adviser as
well as that corporation itself). |
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| 10. |
Permissible Interest. Trustees, agents, and shareholders
of the Trust or the Adviser are or may be interested in the Sub-Adviser (or any
successor thereof) as directors, officers, or shareholders, or otherwise; directors,
officers, agents and shareholders of the Sub-Adviser are or may be interested in
the Trust or the Adviser as directors, officers, shareholders or otherwise; and
the Sub-Adviser (or any successor) is or may be interested in the Trust or the Adviser
as a shareholder or otherwise. In addition, brokerage transactions for the Trust
may be effected through affiliates of the Adviser or Sub-Adviser if approved by
the Trust’s Board of Trustees subject to the rules and regulations of the U.S.
Securities and Exchange Commission, and the policies and procedures adopted by the
Trust. |
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| 11. |
Duties and Termination. This Agreement shall become effective
on the date first above written subject to its approval by the shareholders of the
Fund and unless sooner terminated as provided herein, shall continue in effect for
two (2) years from that date. Thereafter, this Agreement shall be renewable for
successive periods of one year each, provided such continuance is specifically approved
annually (a) by the vote of a majority of those members of the Trust’s Board
who are not parties to this Agreement or interested persons of any such party (as
that term is defined in the 1940 Act), cast in person at a meeting called for the
purpose of voting on such approval, and (b) by vote of either the Board or of a
majority of the outstanding voting securities (as that term is defined in the 0000
Xxx) of the Fund. Notwithstanding the foregoing, this Agreement may be terminated
by the Adviser, the Fund or by the Trust at any time on sixty (60) days’ written
notice, without the payment of any penalty, provided that termination must be authorized
either by vote of the Board or by vote of a majority of the outstanding voting securities
of the Fund or by the Sub-Adviser on sixty (60) days written notice. This Agreement
will automatically terminate upon the termination of the Investment Advisory |
Agreement
between the Adviser and the Trust with respect to the Fund. This Agreement will
automatically terminate in the event of its assignment (as that term is defined
in the 1940 Act). |
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| 12. |
Amendment of this Agreement. No provision of this Agreement
may be changed, waived, discharged or terminated orally, but only by an instrument
in writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought. No material amendment of this Agreement shall
be effective until approved by vote of the holders of a majority of the Fund’s
outstanding voting securities (as defined in the 1940 Act). |
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| 13. |
Notice. Any notice required or permitted to be given by
either party to the other shall be deemed sufficient if sent by registered or certified
mail, postage prepaid, addressed by the party giving notice to the other party at
the address stated below: |
| (a) To the Trust at: | 0000 Xxxxx
Xxxxx Xxxxxxx Xxxxx 000 Xxxxxxxx, Xxxxxxxx 00000 |
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| (b) To the Adviser at: | Union Street
Partners, LLC 000 Xxxxx Xxxxx Xxxxxx, Xxxxx 000 Xxxxxxxxxx, XX 00000 |
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| (c) To the Sub-Adviser at: | XxXxxx Investment
Management, Inc. 000 Xxxxx Xxxxx Xxxxxx, Xxxxx 000 Xxxxxxxxxx, XX 00000 |
| 14. |
Miscellaneous. The captions in this Agreement are included
for convenience of reference only and in no way define or limit any of the provisions
hereof or otherwise affect their construction or effect. If any provision of this
Agreement shall be held or made invalid by a court decision, statute, rule or otherwise,
the remainder of the Agreement shall not be affected thereby. This Agreement shall
be binding and shall inure to the benefit of the parties hereto and their respective
successors. |
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| 15. |
Applicable Law. This Agreement shall be construed in accordance
with, and governed by, the laws of the Commonwealth of Virginia, and the applicable
provisions of the 1940 Act. To the extent that the applicable laws of the Commonwealth
of Virginia, or any of the provisions herein, conflict with the applicable provisions
of the 1940 Act, the latter shall control. |
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| 16. |
Entire Agreement. This Agreement consists of the entire
agreement of the parties with respect to the subject matter hereof and supersedes
all prior writings and understandings relating thereto. |
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| 17. |
Counterparts. This Agreement may be executed in two or
more counterparts, each of which, when so executed, shall be deemed to be an original,
but such counterparts shall together constitute but one and the same instrument. |
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be executed by their officers designated below as of the day and year first above written.
| UNION STREET PARTNERS, LLC | ||||
| BY: | /s/ Xxxxx X. XxXxxxxxxx | |||
Xxxxx X. XxXxxxxxxx |
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Managing Member |
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| XXXXXX INVESTMENT MANAGMENET, INC. | ||||
| BY: | /s/ Xxxxxxx X. XxXxxx |
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| Xxxxxxx X. XxXxxx | ||||
| President | ||||
SCHEDULE A TO
SUB-ADVISORY AGREEMENT
BY AND BETWEEN
UNION STREET PARTNERS, LLC
AND
XXXXXX INVESTMENT MANAGEMENT, INC.
For the services to be rendered by the Sub-Adviser under this Agreement, the Adviser shall pay to the Sub-Adviser, and the Sub-Adviser will accept as full compensation, a fee accrued daily at the annual rates, listed in the table below, on the average net assets of each Fund and paid monthly:
| Fund | Annual Rate | |||
| Union Street Partners Value Fund | 0.50% |
