SUB-ADVISORY AGREEMENT
TOUCHSTONE INTERMEDIATE FIXED INCOME FUND
TOUCHSTONE FUNDS GROUP TRUST
This SUB-ADVISORY AGREEMENT (this "Agreement") is effective as of April
22, 2009, by and between TOUCHSTONE ADVISORS, INC., an Ohio corporation (the
"Advisor"), and MILNE LLC (d/b/a XX Xxxxx Asset Management), a Delaware limited
liability company (the "Sub-Advisor").
WHEREAS, the Advisor is an investment advisor registered under the
Investment Advisers Act of 1940, as amended, and has been retained by Touchstone
Funds Group Trust (the "Trust"), a Delaware business trust organized pursuant to
an Agreement and Declaration of Trust dated October 25, 1993 (as amended) and
registered as an open-end diversified management investment company under the
Investment Company Act of 1940 (the "1940 Act"), to provide investment advisory
services with respect to certain assets of the Touchstone Intermediate Fixed
Income Fund (the "Fund"); and
WHEREAS, the Sub-Advisor also is an investment advisor registered under
the Investment Advisers Act of 1940, as amended; and
WHEREAS, the Advisor desires to retain the Sub-Advisor to furnish it with
portfolio management services in connection with the Advisor's investment
advisory activities on behalf of the Fund, and, subject to approval by the
Trust's Board of Trustees and compliance with the terms of certain exemptive
relief obtained from the United States Securities and Exchange Commission
("Commission"), Advisor may appoint Sub-Advisor, and this Agreement may become
effective, without shareholder approval; and
WHEREAS, the Sub-Advisor is willing to furnish such services to the
Advisor and the Fund on the terms, and subject to the conditions, set forth in
this Agreement;
NOW THEREFORE, in consideration of the terms and conditions hereinafter
set forth, it is agreed as follows:
1. EMPLOYMENT OF THE SUB-ADVISOR. In accordance with and subject to the
Investment Advisory Agreement between the Trust and the Advisor, attached hereto
as Exhibit A (the "Advisory Agreement"), the Advisor hereby appoints the
Sub-Advisor to manage, without prior consultation with the Advisor or the
Trusts' Board of Trustees, the investment and reinvestment of all of the assets
of the Fund (the "Fund Assets"), in conformity with the Fund's currently
effective Registration Statement, prospectus and Statement of Additional
Information and subject to the general control and direction of the Advisor and
the Trust's Board of Trustees, for the period and on the terms hereinafter set
forth. The Sub-Advisor shall be afforded a reasonable amount of time after
receiving notice of changes to the foregoing documents to implement any such
changes. The Sub-Advisor hereby accepts such employment and agrees during such
period to render the services and to perform the duties called for by this
Agreement for the compensation herein provided. The Sub-Advisor shall at all
times maintain its registration as an investment advisor under the Investment
Advisers Act of 1940 (the "Advisers Act") and shall otherwise comply in all
material respects with all applicable laws and regulations, both state and
federal. The Sub-Advisor shall for all purposes herein be deemed an independent
contractor and shall, except as expressly provided or authorized (whether herein
or otherwise), have no authority to act for or represent the Trust in any way or
otherwise be deemed an agent of the Trust or the Fund.
Advisor, on behalf of itself and the Trust, hereby appoints Sub-Advisor as
attorney-in-fact for Advisor and the Trust (with respect to the Fund), with the
authority to act by and on behalf of, and in the name of, the Advisor and the
Trust (with respect to the Fund), including to open and maintain brokerage and
other accounts, execute transactions and take other actions, as necessary or
appropriate to act as Sub-Advisor to the Advisor and the Trust with respect to
the Fund Assets on a basis consistent with this Agreement. If requested by
Sub-Advisor, Advisor (on behalf of itself and the Fund) agrees to execute and
deliver (or cause to be executed and delivered) to Sub-Advisor a mutually
acceptable stand-alone limited power of attorney.
2. DUTIES OF THE SUB-ADVISOR. The Sub-Advisor will provide the following
services and undertake the following duties:
a. The Sub-Advisor will manage the investment and reinvestment of
the Fund Assets, subject to and in accordance with the investment
objectives, policies and restrictions of the Fund and in conformity with
the Fund's currently effective Registration Statement, prospectus and
Statement of Additional Information and any directions which the Advisor
or the Trust's Board of Trustees may give from time to time with respect
to the Fund. In furtherance of the foregoing, the Sub-Advisor will make
all determinations with respect to the investment of the Fund Assets and
the purchase and sale of portfolio securities and shall take such steps as
may be necessary or advisable to implement the same. The Sub-Advisor also
will determine the manner in which rights to consent to corporate action
and any other rights pertaining to the portfolio securities will be
exercised. Notwithstanding the foregoing, the Advisor (pursuant to
authority granted to Advisor by the Trust) shall be solely responsible for
instructing the Trust's custodian as to the voting of proxies for Fund
Assets. The Sub-Advisor will render regular reports to the Trust's Board
of Trustees and to the Advisor (or such other advisor or advisors as the
Advisor shall engage to assist it in the evaluation of the performance and
activities of the Sub-Advisor) as reasonably requested by the Advisor and
agreed to by Sub-Advisor in its reasonable discretion.
b. Sub-Advisor may from time to time become aware of pricing
discrepancies. If Sub-Advisor so becomes aware, the Sub-Advisor shall
promptly notify the Advisor if the Sub-Advisor reasonably believes that
the value of any security that is a Fund Asset may not reflect fair value.
Upon the reasonable request of Advisor, the Sub-Advisor agrees to provide
any pricing information of which the Sub-Advisor is aware (and which
Sub-Advisor can provide without violating applicable law or any
confidentiality obligations) to the Advisor and/or any Fund pricing agent
to assist in the determination of the fair value of any Fund Asset for
which market quotations are not readily available or as otherwise required
in accordance with the 1940 Act or the Fund's valuation procedures for the
purpose of calculating the Fund's net asset value in accordance with
procedures and methods established by the Board. Advisor acknowledges that
Sub-Advisor is not the Fund's pricing agent.
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c. Regulatory Compliance.
(i) The Sub-Advisor agrees to comply with the requirements of
the 1940 Act, the Advisers Act, the 1933 Act, the Securities Exchange Act
of 1934, as amended (the "1934 Act"), the Commodity Exchange Act and the
respective rules and regulations thereunder, as applicable, as well as
with all other applicable federal and state laws, rules, regulations and
case law that relate to the services and relationships described
hereunder, in each case with respect to the Fund Assets sub-advised by
Sub-Advisor, and to the conduct of its business as a registered investment
adviser. In selecting the Fund's portfolio securities and performing the
Sub-Advisor's obligations hereunder, the Sub-Advisor shall cause the Fund
Assets to comply with the diversification and source of income
requirements of Subchapter M of the Internal Revenue Code of 1986, as
amended (the "Code"), for qualification as a regulated investment company.
The Sub-Advisor shall maintain compliance procedures that it reasonably
believes are adequate to ensure the compliance with the foregoing. Given
that Sub-Advisor is responsible for managing only the Fund Assets, in no
event shall Sub-Advisor be responsible for compliance testing with respect
to any assets of the Fund other than the Fund Assets sub-advised by
Sub-Advisor.
(ii) The Sub-Advisor has adopted a written code of ethics that
it reasonably believes complies with the requirements of Rule 17j-1 under
the 1940 Act, which it will provide to the Advisor and the Fund. The
Sub-Advisor shall use commercially reasonable efforts to ensure that its
Access Persons (as defined in the Sub-Advisor's Code of Ethics) comply in
all material respects with the Sub-Advisor's Code of Ethics, as in effect
from time to time. Upon reasonable request, the Sub-Advisor shall provide
the Fund with (i) a copy of the Sub-Advisor's current Code of Ethics, as
in effect from time to time, and (ii) a certification that it has adopted
procedures reasonably designed to prevent Access Persons from engaging in
any conduct prohibited by the Sub-Advisor's Code of Ethics. No less
frequently than annually, the Sub-Advisor shall furnish a written report,
which complies with the requirements of Rule 17j-1, concerning the
Sub-Advisor's Code of Ethics to the Fund and the Advisor. The Sub-Advisor
shall respond to reasonable requests for information from the Advisor as
to violations of the Code by Access Persons and the sanctions imposed by
the Sub-Advisor. The Sub-Advisor shall promptly notify the Advisor of any
material violation of the Code, whether or not such violation relates to a
security held by any Fund.
(iii) The Sub-Advisor shall notify the Trust's Chief
Compliance Officer and Advisor promptly upon detection of (i) any material
failure to manage the Fund in accordance with its investment objectives
and policies or any applicable law; or (ii) any material breach of any of
the Fund's or the Adviser's policies, guidelines or procedures that have
been made known to Sub-Advisor in writing. In addition, the Sub-Advisor
shall provide a quarterly report regarding the Fund's compliance with its
investment objectives and policies and applicable law, including, but not
limited to the 1940 Act, the Code, and the Fund's and the Advisor's
policies, guidelines or procedures as applicable to the Sub-Advisor's
obligations under this Agreement. The Sub-Advisor acknowledges and agrees
that the Advisor may, in its discretion, provide such quarterly compliance
certifications to the Board. The Sub-Advisor agrees to take reasonable
actions to correct any such failure promptly and to take any action that
the Board and/or the Advisor may reasonably request in connection with any
such breach. The Sub-Advisor shall also provide the officers of the Trust
with reasonable supporting certifications in connection with such
certifications of Fund financial statements and disclosure controls
pursuant to the Xxxxxxxx-Xxxxx Act. Unless prohibited by applicable law,
the Sub-Advisor will promptly notify the Trust in the event (i) the
Sub-Advisor 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 Trust
(excluding class action suits in which a Fund is a member of the plaintiff
class by reason of the Fund's ownership of shares in the defendant) or the
compliance by the Sub-Advisor with the federal or state securities laws or
(ii) the Sub-Advisor is, or is reasonably expected to be, a party to a
proposed transaction which, if consummated, would cause an "assignment"
(as defined in the 0000 Xxx) of this Agreement.
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(iv) The Sub-Advisor shall maintain separate books and
detailed records of all matters pertaining to the Fund Assets advised by
the Sub-Advisor required by Rule 31a-1 under the 1940 Act (other than
those records being maintained by the Advisor, custodian or transfer agent
appointed by the Fund) relating to its responsibilities provided hereunder
with respect to the Fund, and shall preserve such records for the periods
and in a manner prescribed therefore by Rule 31a-2 under the 1940 Act (the
"Fund Books and Records" ). The Fund Books and Records shall be available
to the Advisor and the Board at any time upon request shall be delivered
to the Trust upon the termination of this Agreement and shall be available
for telecopying without unreasonable delay during any day the Fund is open
for business; provided that Sub-Advisor may retain copies of such records,
subject to the obligations of confidentiality set forth in Section 12 of
this Agreement, to the extent Sub-Advisor reasonably believes it is
necessary for Sub-Advisor to do so in order to comply with applicable law.
d. The Sub-Advisor hereby provides (i) permission to use the
Sub-Advisor's name as provided in Section 5, (ii) permission to use
certain past performance and investment history of the Sub-Advisor with
respect to a composite of certain other funds managed by the Sub-Advisor
that are comparable, in investment objective and composition, to the Fund
(iii) access to the individual(s) responsible for day-to-day management of
the Fund for marketing conferences, teleconferences and other activities
involving the promotion of the Fund, subject to the reasonable request of
the Advisor, and (iv) permission to use biographical and historical data
of the Sub-Advisor and individual manager(s) as required by applicable law
in the Fund's Registration Statement or other disclosures. Advisor (on
behalf of itself and the Trust) agrees to comply with any reasonable
guidelines regarding the use of Sub-Advisor's name, and any performance
history, biographical data, or historical data that Sub-Advisor may from
time to time, in its discretion, provide in writing to Advisor and the
Trust.
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e. The Sub-Advisor will, in the name of the Fund, place orders for
the execution of all portfolio transactions in accordance with the
policies with respect thereto set forth in the Trust's registration
statements under the 1940 Act and the Securities Act of 1933, as such
registration statements may be in effect from time to time. When placing
orders with brokers and dealers, the Sub-Advisor's primary objective shall
be to seek to obtain the best execution available for the Fund, and in
placing such orders the Sub-Advisor may consider a number of factors,
including, without limitation, the overall direct net economic result to
the Fund (including commissions, which may not be the lowest available but
ordinarily should not be higher than the generally prevailing competitive
range), the financial strength and stability of the broker, the efficiency
with which the transaction will be effected, the ability to effect the
transaction at all where a large block is involved and the availability of
the broker or dealer to stand ready to execute possibly difficult
transactions in the future. Consistent with the Conduct Rules of the
Financial Industry Regulatory Authority, and subject to seeking best
execution and compliance with Rule 12b-1(h) under the 1940 Act, the
Sub-Advisor may select brokers and dealers to execute portfolio
transactions of the Fund that promote or sell shares of the Fund. The
Sub-Advisor is specifically authorized, to the extent authorized by law
(including, without limitation, Section 28(e) of the 0000 Xxx) to pay a
broker or dealer who provides research services to the Sub-Advisor an
amount of commission for effecting a portfolio transaction in excess of
the amount of commission another broker or dealer would have charged for
effecting such transaction, in recognition of such additional research
services rendered by the broker or dealer, but only if the Sub-Advisor
determines in good faith that the excess commission is reasonable in
relation to the value of the brokerage and research services provided by
such broker or dealer viewed in terms of the particular transaction or the
Sub-Advisor's overall responsibilities with respect to discretionary
accounts that it manages, the Fund derives or will derive a reasonable
benefit from such research services to the extent required under
applicable law, and the Sub-Advisor acts in accordance with its applicable
policies and procedures in effect from time to time. The Sub-Advisor will
present a written report to the Board of Trustees of the Trust, at least
quarterly, indicating total brokerage expenses, actual or imputed, as well
as the services obtained in consideration for such expenses, broken down
by broker-dealer and containing such information as the Board of Trustees
reasonably shall request.
f. The Sub-Advisor shall maintain errors and omissions insurance
coverage in an amount Sub-Advisor reasonably believes is appropriate and
shall provide prior written notice to the Trust (i) of any material
changes in its insurance policies or insurance coverage; or (ii) unless
prohibited by applicable law, of any material claims made on its insurance
policies. Furthermore, the Sub-Advisor shall, upon reasonable request,
provide the Trust with any information it may reasonably require
concerning the amount of or scope of such insurance.
g. In the event of any reorganization or other material change in
the Sub-Advisor, its investment principals, supervisors or members of its
investment (or comparable) committee, the Sub-Advisor shall give the
Advisor and the Trust's Board of Trustees written notice of such
reorganization or change within a reasonable time (but not later than 30
days) after such reorganization or change.
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h. The Sub-Advisor will bear its expenses of providing services to
the Fund pursuant to this Agreement, except such expenses as are expressly
undertaken by the Advisor or the Trust whether undertaken by the Advisor,
the Trust in this Agreement or the Advisory Agreement, or otherwise.
3. COMPENSATION OF THE SUB-ADVISOR.
a. As compensation for the services to be rendered and duties
undertaken hereunder by the Sub-Advisor, the Advisor will pay to the
Sub-Advisor a monthly fee equal on an annual basis to ___% of the average
daily net assets of the Fund without regard to any total expense
limitation of the Trust or the Advisor. Such fee shall be computed and
accrued daily. If the Sub-Advisor serves in such capacity for less than
the whole of any period specified in this Section 3a, the compensation to
the Sub-Advisor shall be prorated. For purposes of calculating the
Sub-Advisor's fee, the daily value of the Fund Assets shall be computed by
the same method as the Trust uses to compute the net asset value of the
Fund for purposes of purchases and redemptions of shares thereof.
b. The Sub-Advisor reserves the right to waive all or a part of its
fees hereunder.
4. FORM ADV. Advisor hereby acknowledges that Sub-Advisor has supplied to
the Advisor and the Trust, at least 48 hours prior to entering into this
Agreement, copies of its Form ADV with all exhibits and attachments thereto
(including the Sub-Advisor's statement of financial condition and will hereafter
supply to the Advisor, promptly upon the preparation thereof, copies of all
amendments or restatements of such document.
5. USE OF NAMES. Throughout the term of this Agreement, neither the
Advisor nor the Trust shall use the name of the Sub-Advisor in any prospectus,
sales literature or other material relating to the Advisor or the Trust in any
manner not approved in advance by the Sub-Advisor; provided, however, that the
Sub-Advisor will approve all uses of its name which merely refer in accurate
terms to its appointment hereunder or which are required or permitted by the SEC
or a state securities commission; and provided further, that in no event shall
such approval be unreasonably withheld. Advisor (on behalf of itself and the
Trust) agrees to comply with any reasonable guidelines regarding the use of
Sub-Advisor's name that Sub-Advisor may from time to time provide in writing to
Advisor and the Trust. Throughout the term of this Agreement, the Sub-Advisor
shall not use the name of the Advisor or the Trust in any material relating to
the Sub-Advisor in any manner not approved in advance by the Advisor or the
Trust, as the case may be; provided, however, that the Advisor and the Trust
shall each approve all uses of their respective names which merely refer in
accurate terms to the appointment of the Sub-Advisor hereunder or which are
required or permitted by the SEC or a state securities commission; and, provided
further, that in no event shall such approval be unreasonably withheld.
6. LIABILITY; LIMITATION OF SUB-ADVISOR LIABILITY.
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a. The Sub-Advisor shall indemnify and hold harmless the Trust and
all affiliated persons thereof (within the meaning of Section 2(a)(3) of
the 0000 Xxx) and all controlling persons (as described in Section 15 of
the 1933 Act) (collectively, the "Advisor Indemnitees") against any and
all losses, claims, damages, liabilities or litigation (including
reasonable legal and other expenses) by reason of or arising out of: (a)
the Sub-Advisor being in material violation of any applicable federal or
state law, rule or regulation or any investment policy or restriction set
forth in the Funds' Registration Statement or any written guidelines or
instruction provided in writing by the Board, or (b) the Sub-Advisor's
willful misfeasance, bad faith or gross negligence generally in the
performance of its duties hereunder or its reckless disregard of its
obligations and duties under this Agreement. For the avoidance of doubt,
and without limiting the foregoing, Sub-Advisor's indemnification
obligations under this Section 6(a) will include losses, claims, damages,
liabilities and litigation (including reasonable legal and other expenses)
suffered or incurred by Advisor Indemnitees by reason of or arising out of
the Fund's, Trust's or Advisor's material violation of applicable federal
or state law, rule or regulation or any investment policy or restriction
set forth in the Funds' Registration Statement or in any written
guidelines or instruction provided in writing by the Board, in each case,
to the extent caused by Sub-Advisor's material violation (as contemplated
in clause (a) above) or Sub-Advisor's willful misfeasance, bad faith or
gross negligence (as contemplated in clause (b) above). As used in this
Section 6(a), the term "Sub-Advisor" shall include the Sub-Advisor and/or
any of its affiliates and the directors, officers and employees of the
Sub-Advisor and/or any of its affiliates.
b. The Advisor shall indemnify and hold harmless the Sub-Advisor and
all affiliated persons thereof (within the meaning of Section 2(a)(3) of
the 0000 Xxx) and all controlling persons (as described in Section 15 of
the 1933 Act) (collectively, the "Sub-Advisor Indemnitees") against any
and all losses, claims, damages, liabilities or litigation (including
reasonable legal and other expenses) , other than such losses, claims,
damages, liabilities or litigation caused by the Sub-Advisor's material
violation of any applicable federal or state law, rule or regulation or
any investment policy or restriction set forth in the Funds' Registration
Statement or any written guidelines or instruction provided in writing by
the Board, or the Sub-Advisor's willful misfeasance, bad faith or gross
negligence generally in the performance of its duties hereunder or its
reckless disregard of its obligations and duties under this Agreement, as
contemplated by Section 6(a) of this Agreement, by reason of or arising
out of: (a) the Advisor, the Trust or the Fund being in material violation
of any applicable federal or state law, rule or regulation or any
investment policy or restriction set forth in the Funds' Registration
Statement or any written guidelines or instruction provided in writing by
the Board, (b) the operation of the Trust and Fund, or (c) the Advisor's,
Trust's or Fund's willful misfeasance, bad faith or gross negligence
generally in the performance of their respective duties hereunder or its
reckless disregard of their respective obligations and duties under this
Agreement. As used in this Section 6(b), the terms "Advisor," "Trust" and
"Fund" shall include the Advisor, Trust and Fund, respectively, and/or any
of their respective affiliates and the directors, officers and employees
of any of them and/or any of their affiliates.
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c. The duties of the Sub-Advisor shall be confined to those
expressly set forth herein, and no implied duties are assumed by or may be
asserted against the Sub-Advisor hereunder. The Sub-Advisor shall not be
liable for any error of judgment or mistake of law or for any loss arising
out of any investment or for any act or omission in carrying out its
duties hereunder, except a loss resulting from willful misfeasance, bad
faith or gross negligence in the performance of its duties, or by reason
of reckless disregard of its obligations and duties hereunder, except as
may otherwise be provided under provisions of applicable state law or
federal securities law which cannot be waived or modified hereby. As used
in this Section 6(c), the term "Sub-Advisor" shall include the Sub-Advisor
and/or any of its affiliates and the directors, officers and employees of
the Sub-Advisor and/or any of its affiliates.
7. LIMITATION OF TRUST'S LIABILITY. The Sub-Advisor acknowledges that it
has received notice of and accepts the limitations upon the Trust's liability
set forth in its Declaration of Trust. The Sub-Advisor agrees that (i) the
Trust's obligations to the Sub-Advisor under this Agreement (or indirectly under
the Advisory Agreement) shall be limited in any event to the Fund Assets and
(ii) the Sub-Advisor shall not seek satisfaction of any such obligation from the
holders of shares of the Fund, other than the Advisor, nor from any Trustee,
officer, employee or agent of the Trust.
8. FORCE MAJEURE. The Sub-Advisor shall not be liable for delays or errors
occurring by reason of circumstances beyond its control, including but not
limited to acts of civil or military authority, national emergencies, work
stoppages, fire, flood, catastrophe, acts of God, insurrection, war, terrorism,
riot, or failure of communication or power supply. In the event of equipment
breakdowns beyond its control, the Sub-Advisor shall take commercially
reasonable steps to minimize service interruptions but shall have no liability
with respect thereto.
9. RENEWAL, TERMINATION AND AMENDMENT.
a. This Agreement shall continue in effect, unless sooner terminated
as hereinafter provided, until April 22, 2011; and it shall continue
thereafter provided that such continuance is specifically approved by the
parties and, in addition, at least annually by (i) the vote of the holders
of a majority of the outstanding voting securities (as herein defined) of
the Fund or by vote of a majority of the Trust's Board of Trustees and
(ii) by the vote of a majority of the Trustees who are not parties to this
Agreement or interested persons of either the Advisor or the Sub-Advisor,
cast in person at a meeting called for the purpose of voting on such
approval.
b. This Agreement may be terminated at any time, without payment of
any penalty, (i) by the Advisor upon not more than sixty (60) days' nor
less than thirty (30) days' written notice delivered or mailed by
registered mail, postage prepaid, to the Sub-Advisor; (ii) by the
Sub-Advisor upon not less than sixty (60) days' written notice delivered
or mailed by registered mail, postage prepaid, to the Advisor; or (iii) by
the Trust upon either (y) the majority vote of its Board or (z) the
affirmative vote of a majority of the outstanding voting securities of the
Fund. This Agreement shall terminate automatically in the event of its
assignment. Subject to the foregoing sentence, this Agreement shall be
binding upon the parties and their respective successors and assigns.
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c. This Agreement may be amended at any time by the parties hereto
in a writing signed by each of the parties hereto, subject to approval by
the Trust's Board of Trustees and, if required by applicable SEC rules and
regulations, a vote of the majority of the outstanding voting securities
of the Fund affected by such change.
d. The terms "assignment," "interested persons" and "majority of the
outstanding voting securities" shall have the meaning set forth for such
terms in the 1940 Act.
10. SEVERABILITY. If any provision of this Agreement shall become or shall
be found to be invalid by a court decision, statute, rule or otherwise, the
remainder of this Agreement shall not be affected thereby.
11. NOTICE. Any notices under this Agreement shall be in writing addressed
and delivered personally (or by telecopy) or mailed postage-paid, to the other
party at such address as such other party may designate in accordance with this
paragraph for the receipt of such notice. Until further notice to the other
party, it is agreed that the address of the Trust and that of the Advisor for
this purpose shall be 000 Xxxxxxxx, Xxxxx 0000, Xxxxxxxxxx, Xxxx 00000 and that
the address of the Sub-Advisor shall be: 000 Xxxx Xxxxxxx Xxxxxx Xxxxx, Xxxxx
000, Xxxxxxxxxx, Xxxxxxxxxxxx 00000-0000.
12. CONFIDENTIALITY. All information and advice furnished by one party to
the other party (including their respective agents, employees and
representatives) hereunder shall be treated as confidential and shall not be
disclosed to unaffiliated third parties, except as may be necessary to comply
with applicable laws, rules and regulations, subpoenas or court orders or
expressly permitted under applicable law. Without limiting the foregoing,
Advisor acknowledges that the securities holdings of the Fund constitute
information of value to the Sub-Advisor, and agrees: (1) not to use for any
purpose, other than for Advisor or the Fund, or their agents, to supervise or
monitor the Sub-Advisor, the holdings or other trading-related information of
the Fund; and (2) not to disclose the Fund's holdings, except: (a) as required
or expressly permitted by applicable law or regulation; (b) as required by state
or federal regulatory authorities; (c) to the Board of Trustees of the Trust,
counsel to the Board, counsel to the Trust, the administrator or any
sub-administrator, the independent accountants and any other agent of the Trust;
(d) in accordance with the Fund's portfolio holdings policies and procedures; or
(e) as otherwise agreed to by the parties hereto in writing. Further, Advisor
agrees that information supplied by the Sub-Advisor, including approved lists,
internal procedures, compliance procedures and any board materials, is valuable
to the Sub-Advisor, and Advisor agrees not to disclose any of the information
contained in such materials, except: (i) as required by applicable law or
regulation; (ii) as required by state or federal regulatory authorities; (iii)
to the Board of Trustees of the Trust, counsel to the Board, counsel to the
Trust, the administrator or any sub-administrator, the independent accountants
and any other agent of the Trust; or (iv) as otherwise agreed to by the parties
hereto in writing.
13. REPRESENTATIONS AND WARRANTIES.
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a. The Sub-Advisor hereby represents and warrants to the Fund and
Advisor that:
i. The Sub-Advisor has the authority to execute and deliver
this Agreement and has obtained all required governmental and regulatory
licenses, registrations and approvals required by law as may be necessary
to perform its obligations under this Agreement, including without
limitation registration as an investment adviser under the Investment
Advisers Act of 1940, as amended, and will maintain and renew any required
licenses, registrations, approvals and memberships during the term of this
Agreement;
ii. There is no pending, or to the best of its knowledge,
threatened or contemplated action, suit or proceeding before or by any
court, governmental, administrative or self-regulatory body or arbitration
panel to which the Sub-Advisor or any of its principals is a party, or to
which any of the assets of the Sub-Advisor is subject, which reasonably
might be expected to (A) result in any material adverse change in the
Sub-Advisor's condition (financial or otherwise), business or prospects,
(B) affect adversely in any material respect any of the Sub-Advisor's
assets, or (C) materially impair the Sub-Advisor's ability to discharge
its obligations under this Agreement; and the Sub-Advisor has not received
any notice of a current investigation by the Commission or any state
regarding U.S. federal or state securities laws, regulations or rules; and
iii. All references in the Fund's registration statement
concerning the Sub-Advisor and its affiliates and the controlling persons,
affiliates, stockholders, directors, officers and employees of any of the
foregoing provided to Advisor by the Sub-Advisor or approved by the
Sub-Advisor for use in such registration statement, as well as all
performance information provided to Advisor by the Sub-Advisor or approved
by the Sub-Advisor for use by Advisor, are accurate in all material
respects and do not contain any untrue statement of a material fact or
omit to state a material fact necessary in order to make such information
not misleading.
The foregoing representations and warranties shall be continuing during
the term of this Agreement.
b. Advisor hereby represents and warrants to the Sub-Advisor that:
i. Advisor has all requisite corporate power and authority
under the laws of the State of Ohio and federal securities laws and under
the Advisory Agreement with the Trust (with respect to the Fund) to
execute, deliver and perform this Agreement;
ii. Advisor is a registered investment adviser under the
Investment Advisers Act of 1940, as amended, and is in compliance with all
other required registrations and approvals under applicable federal and
state law as may be necessary to perform its obligations under this
Agreement and under the Advisory Agreement and to act as contemplated by
the Trust's governing documents and the Trust's registration statement,
and will maintain and renew any required licenses, registrations,
approvals and memberships during the term of this Agreement;
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iii. Advisor, the Trust and the Fund have complied with all
registrations required by, and will comply, with all applicable laws and
the rules and regulations of the Commission;
iv. There is no pending, or to the best of its knowledge,
threatened or contemplated action, suit or proceeding before or by any
court, governmental, administrative or self-regulatory body or arbitration
panel to which Advisor, the Trust or the Fund or any of their respective
principals is a party, or to which any of their respective assets are
subject, which might reasonably be expected to (i) result in any material
adverse change in Advisor's, the Trust's or the Fund's condition
(financial or otherwise), business or prospects, (ii) affect adversely in
any material respect any of Advisor's, the Trust's or the Fund's assets,
or (iii) materially impair Advisor's ability to discharge its obligations
under this Agreement; and neither Advisor, the Trust nor the Fund has
received any notice of a current investigation by the Commission or any
state regarding U.S. federal or state securities laws, regulations or
rules.
The foregoing representations and warranties shall be continuing during
the term of this Agreement.
14. MISCELLANEOUS. Each party agrees to perform such further actions and
execute such further documents as are reasonably necessary to effectuate the
purposes hereof. This Agreement shall be construed and enforced in accordance
with and governed by the laws of the State of Delaware, and each party consents
to the jurisdiction of the federal courts in Ohio, with respect to any dispute
under this Agreement. The captions in this Agreement are included for
convenience only and in no way define or delimit any of the provisions hereof or
otherwise affect their construction or effect. This Agreement constitutes the
entire agreement among the parties hereto with respect to the matters referred
to herein, and no other agreement, oral or otherwise, shall be binding on the
parties hereto. No failure or delay on the part of any party hereto in
exercising any right, power or remedy hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right, power or
remedy preclude any other or further exercise thereof or the exercise of any
other right, power or remedy. This Agreement may be executed simultaneously in
two or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
THE REMAINDER OF THIS PAGE HAS BEEN LEFT INTENTIONALLY BLANK
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered in their names and on their behalf by the undersigned,
thereunto duly authorized, on the day and year set forth below, effective as of
April 22, 2009.
TOUCHSTONE ADVISORS, INC.
Attest:
By: /s/ Xxxx X. XxXxxxxx
-------------------------------- ----------------------------
Name: Name:
-------------------------- --------------------------
Title: Title: President
------------------------- -------------------------
Date: 05/01/09
--------------------------
MILNE LLC
Attest:
By: /s/ Xxxx X. Xxxxx
-------------------------------- ----------------------------
Name: Name: Xxxx X. Xxxxx
-------------------------- --------------------------
Title: Title: Chief Executive Officer
------------------------- -------------------------
Date: 05/01/09
--------------------------
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