EX-99.B(d)(2)(i)
SUB-ADVISORY CONTRACT
XXXXX FARGO FUNDS MANAGEMENT, LLC
000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
March 1, 2001
Barclays Global Fund Advisors
00 Xxxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Dear Sirs:
This will confirm the agreement by and among Xxxxx Fargo Funds Management,
LLC (the "Adviser"), Xxxxx Fargo Funds Trust (the "Trust"), on behalf of each
Fund listed on attached Appendix I as it may be amended from time to time (each,
a "Fund" and collectively, the "Funds"), and Barclays Global Fund Advisors (the
"Sub-Adviser") as follows:
1. The Trust is a registered open-end management investment company
currently consisting of a number of investment portfolios, but which may from
time to time consist of a greater or lesser number of investment portfolios. The
Trust proposes to engage in the business of investing and reinvesting the assets
of the Funds in the manner and in accordance with the investment objective and
restrictions specified in the Trust's Registration Statement, as amended from
time to time (the "Registration Statement"), filed by the Trust under the
Investment Company Act of 1940 (the "Act") and the Securities Act of 1933.
Copies of the Registration Statement have been furnished to the Adviser. Any
amendments to the Registration Statement shall be furnished to the Adviser
promptly.
2. The Trust has engaged the Adviser to manage the investing and
reinvesting of the Funds' assets and to provide the advisory services specified
elsewhere in the Investment Advisory Agreement between the Trust and the
Adviser, dated as of the date hereof, subject to the overall supervision of the
Board of Trustees of the Trust. Pursuant to Administration between the Trust, on
behalf of the Funds, and the Administrator (the "Administrator"), the Trust has
engaged the Administrator to provide the administration services specified
therein.
3. (a) The Adviser hereby employs the Sub-Adviser to perform for the Funds
certain sub-advisory services and the Sub-Adviser hereby accepts such
employment. The Adviser shall retain the authority to establish and modify, from
time to time, the investment strategies and approaches to be followed by the
Sub-Adviser, subject, in all respects, to the supervision and direction of the
Trust's Board of Trustees and subject to compliance with the investment
objective, policies and restrictions set forth in the Registration Statement.
(b) Subject to the overall supervision and control of the Adviser and
the Trust, the Sub-Adviser shall be responsible for investing and reinvesting
the Funds' assets in a manner
consistent with the investment strategies and approaches referenced in
subparagraph (a), above. In this regard, the Sub-Adviser shall be responsible
for implementing and monitoring the performance of the investment model employed
with respect to a Fund, in accordance with the investment objective, policies
and restrictions set forth in the Registration Statement, the Act, and the
provisions of the Internal Revenue Code of 1986 relating to investment
companies, and shall furnish to the Adviser periodic reports on the investment
activity and performance of the Funds. The Sub-Adviser shall also furnish such
additional reports and information as the Adviser and the Trust's Board of
Trustees and officers shall reasonably request.
(c) The Sub-Adviser shall, at its expense, employ or associate with
itself such persons as the Sub-Adviser believes appropriate to assist it in
performing its obligations under this contract.
4. The Adviser shall be responsible for fees paid to the Sub-Adviser for
its services thereunder. The Sub-Adviser agrees that it shall have no claim
against the Trust or the Funds respecting compensation under this contract. In
consideration of the services to be rendered by the Sub-Adviser under this
contract, the Adviser shall pay the Sub-Adviser monthly fees at the rates
specified on Appendix I hereto. If the fee payable to the Sub-Adviser pursuant
to this Paragraph 4 begins to accrue on a day after the first day of any month
or if this contract terminates before the end of any month, the fee for the
period from the effective date to the end of the month, or from the beginning of
that month to the termination date, shall be prorated according to the
proportion that such period bears to the full month in which the effectiveness
or termination occurs. For purposes of calculating the monthly fee, the value of
a Fund's net assets shall be computed in the manner specified in the
Registration Statement and the Trust's Declaration of Trust, as amended or
supplemented from time to time, for the computation of the value of such Fund's
net assets in connection with the determination of the net asset value of Fund
shares.
5. The Sub-Adviser shall give the Trust the benefit of the Sub-Adviser's
best judgment and efforts in rendering services under this contract. As
consideration and as an inducement to the Sub-Adviser's undertaking to render
these services, the Trust and the Adviser agree that the Sub-Adviser shall not
be liable under this contract for any mistake in judgment or in any other event
whatsoever except for lack of good faith, provided that nothing in this contract
shall be deemed to protect or purport to protect the Sub-Adviser against any
liability to the Adviser, the Trust or its shareholders to which the Sub-Adviser
would otherwise be subject by reason of willful misfeasance, bad faith or gross
negligence in the performance of the Sub-Adviser's duties under this contract or
by reason of reckless disregard of its obligations and duties thereunder.
This contract shall become effective as of its execution date and shall
thereafter continue in effect, provided that this contract shall continue in
effect for a period of more than two years from the date hereof only so long as
the continuance is specifically approved at least annually (a) by the vote of a
majority of a Fund's outstanding voting securities (as defined in the Act) or by
the Trust's Board of Trustees and (b) by the vote, cast in person at a meeting
called specifically for the purpose of continuing this Sub-Advisory Contract, of
a majority of the Trust's Trustees who are not parties to this contract or
"interested persons" (as defined in the Act) of any such party. This contract
may be terminated, upon 60 days' written notice to the Sub-Adviser, by the
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Company, without the payment of any penalty, by a vote of a majority of such
Fund's outstanding voting securities (as defined in the Act) or by a vote of a
majority of the Trust's entire Board of Trustees. The Sub-Adviser may terminate
this contract on 60 days' written notice to the Trust. This contract shall
terminate automatically in the event of its assignment (as defined in the Act).
6. This Agreement supersedes the sub-advisory agreement among Xxxxx Fargo
Funds Trust, Xxxxx Fargo Bank, N.A. and Barclays Global Fund Advisors dated
November 8, 1999, as approved by the Board of Trustees on March 26, 1999, as
amended January 25, 2000.
7. Except to the extent necessary to perform the Sub-Adviser's obligations
under this contract, nothing herein shall be deemed to limit or restrict the
right of the Sub-Adviser, or any affiliate of the Sub-Adviser, or any employee
of the Sub-Adviser, to engage in any other business or to devote time and
attention to the management or other aspects of any other business, whether of a
similar or dissimilar nature, or to render services of any kind to any other
corporation, firm, individual or association.
8. The Trust shall own and control all records generated on behalf of the
Trust as a result of services provided under this contract. In addition, the
Trust shall have the right to inspect, audit, and/or copy all records pertaining
to the performance of services under this contract.
9. The Sub-Adviser and the Trust each agree that the name "Xxxxx Fargo,"
which comprises a component of the Trust's name, is a property right of the
parent of the Adviser. The Trust agrees and consents that: (i) it will use the
name "Xxxxx Fargo" as a component of its corporate name, the name of any fund or
class or both, and for no other purpose; (ii) it will not grant to any third
party the right to use the name "Xxxxx Fargo" for any purpose; (iii) the Adviser
or any corporate affiliate of the Adviser may use or grant to others the right
to use the name "Xxxxx Fargo," or any combination or abbreviation thereof, as
all or a portion of a corporate or business name or for any commercial purpose,
other than a grant of such right to another registered investment company not
advised by the Adviser or one of its affiliates; and (iv) in the event that the
Adviser or an affiliate thereof is no longer acting as investment adviser to any
fund or class, the Trust shall, upon request by the Adviser, promptly take such
action as may be necessary to change its corporate name to one not containing
the name "Xxxxx Fargo," and following such change, shall not use the name "Xxxxx
Fargo," or any combination thereof, as a part of its corporate name or for any
other commercial purpose, and shall use its best efforts to cause its directors,
officers, and shareholders to take any and all actions that the Adviser may
request to effect the foregoing and to reconvey to the Adviser any and all
rights to such word.
10. This contract shall be governed by and construed in accordance with the
laws of the State of California.
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If the foregoing correctly sets forth the agreement by and among the
Trust, the Adviser and the Sub-Adviser, please so indicate by signing and
returning to the Trust the enclosed copy hereof.
Very truly yours,
XXXXX FARGO FUNDS MANAGEMENT, LLC
By: /s/ Xxxxxx Xxxx
-----------------------------------
Name: Xxxxxx Xxxx
Title: Vice President
AGREED to as of the date set forth above.
BARCLAYS GLOBAL FUND ADVISORS
By: /s/ Xxxxx XxXxxx
--------------------------------------
Name: Xxxxx XxXxxx
Title: Principal
By: /s/ Xxxxxxx Xxxxxx
--------------------------------------
Name: Xxxxxxx Xxxxxx
Title: Managing Director
ACCEPTED as of the date set forth above.
XXXXX FARGO FUNDS TRUST,
on behalf of each Fund listed on
attached Appendix I
By: /s/ X. Xxxxx Xxxxxxx
--------------------------------------
X. Xxxxx Xxxxxxx
Secretary
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APPENDIX I
Sub-advisory fees shall be paid monthly on the first business day of each
month, at the annual rates specified below of each Fund's average daily value
(as determined on each day that such value is determined for the Fund at the
time set forth in the Prospectus for determining net asset value per share)
during the preceding month.
Fund Investment Advisory Fee
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Asset Allocation Fund 0.15% of first $900 million
0.10% over $900 million
Index Allocation Fund 0.15% of first $900 million
0.10% over $900 million
Approved by Board of Trustees: October 24, 2000.
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