POTOMAC FUNDS SUBADVISORY AGREEMENT
This
Subadvisory Agreement is made as of July 1, 2005 (the “Effective Date”), between
Xxxxxxxx Asset Management, LLC, a New York limited liability corporation (the
“Adviser”), and Transamerica Investment Management, LLC, a Delaware limited
liability company (the “Subadviser”).
WHEREAS,
the Adviser serves as the investment adviser to the HY Bear Fund (the “Fund”),
which is a series of the Potomac Funds (the “Trust”), a Massachusetts business
trust registered as an open-end management investment company under the
Investment Company Act of 1940, as amended (“1940 Act”);
WHEREAS,
the Adviser’s contract with the Fund allows it to delegate certain investment
advisory services to other parties; and
WHEREAS,
the Adviser desires to retain the Subadviser to perform certain investment
subadvisory services for the Fund, and the Subadviser is willing to perform such
services;
NOW,
THEREFORE, in consideration of the promises and mutual covenants herein
contained, and intending to be legally bound hereby, it is agreed between the
parties hereto as follows:
1. Services
to be Rendered by the Subadviser to the Fund.
(a) Investment
Program.
Subject to the control and supervision of the Board of Trustees of the Trust and
the Adviser, the Subadviser shall, at its expense and on a regular basis,
provide a continuous investment program for such portion of the Fund’s assets
that is allocated to it by the Adviser from time to time the Fund, including
investment research and management of all such securities, investments and cash
equivalents. With respect to such assets, the Subadviser shall determine what
investments shall be purchased, held, sold or exchanged by the Fund and what
portion, if any, of the assets of the Fund shall be held in cash or cash
equivalents, and purchase and sell Fund securities for the Fund. In accordance
with Subsection (b) of this Section 1, the Subadviser shall arrange for the
execution of all orders for the purchase and sale of securities and other
investments for the Fund’s account and will exercise full discretion and act for
the Fund in the same manner and with the same force and effect as the Fund might
or could do with respect to such purchases, sales, or other transactions, as
well as with respect to all other things necessary or incidental to the
furtherance or conduct of such purchases, sales, or other
transactions.
In
the performance of its duties, the Subadviser will act in the best interests of
the Fund and will comply with (i) applicable laws and regulations, including,
but not limited to, the 1940 Act and the Investment Advisers Act of 1940, as
amended (“Advisers Act”), and the rules under each, (ii) the terms of this
Agreement, (iii) the stated investment objective, policies and restrictions of
the Fund, as stated in the then-current Form N-1A Registration Statement of the
Fund (“Registration Statement”), (iv) the Trust’s compliance procedures and
other policies, procedures or guidelines as the Board or the Adviser reasonably
may establish from time to time, and
of which are provided to Subadviser within a reasonable time,
(v) the provisions of the Internal Revenue Code of 1986, as amended (“Code”),
applicable to “regulated investment companies” (as defined in Section 851 of the
Code), as from time to time in effect, and (vi) the reasonable written
instructions of the Adviser. The Adviser shall be responsible for providing the
Subadviser with current and
timely copies
of the materials specified in Subsections (a)(iii) and (iv) of this Section
1(a). The Adviser shall provide the Subadviser with prior written notice of any
material change to the Registration Statement that would affect the Subadviser’s
management of the Fund.
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(b) Transactions
for the Fund.
In connection with the management of the investment and reinvestment of the
Fund’s assets, the
Subadviser will place orders pursuant to its investment determinations for the
Fund either directly with the issuer or through brokers or dealer that (i) have
been approved by the Adviser and (ii) will execute purchase and sale
transactions for the Fund subject to the conditions herein. In the selection of
broker-dealers and the placement of orders for the purchase and sale of Fund
investments for the Fund, the Subadviser shall use its best efforts to obtain
for the Fund the most favorable price and execution available and shall not be
permitted to pay higher brokerage commissions for brokerage and research
services. In using its best efforts to obtain the most favorable price and
execution available, the Subadviser, bearing in mind the Fund’s best interests
at all times, shall consider all factors it deems relevant, including by way of
illustration, price, the size of the transaction, the nature of the market for
the security, the amount of the commission and dealer’s spread or xxxx-up, the
timing of the transaction taking into account market prices and trends, the
reputation, experience and financial stability of the broker-dealer involved,
the general execution and operational facilities of the broker-dealer and the
quality of service rendered by the broker-dealer in other
transactions.
On
occasions when the Subadviser deems the purchase or sale of a security to be in
the best interest of the Fund as well as other clients of the Subadviser, the
Subadviser, to the extent permitted by applicable laws and regulations, may
aggregate the securities to be purchased or sold to attempt to obtain a more
favorable price or lower brokerage commissions and efficient execution. In such
event, allocation of the securities so purchased or sold, as well as the
expenses incurred in the transaction, will be made by the Subadviser in the
manner it considers to be the most equitable and consistent with its fiduciary
obligations to the Fund and to its other clients over time.
The
Subadviser may buy securities for the Fund at the same time it is selling such
securities for another client account and may sell securities for the Fund at
the time it is buying such securities for another client account. In such cases,
subject to applicable legal and regulatory requirements, and in compliance with
such procedures of the Trust as may be in effect from time to time, the
Subadviser may effectuate cross transactions between the Fund and such other
account if it deems this to be advantageous.
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The
Subadviser will advise the Fund’s custodian or such depository or agents as may
be designated by the custodian and the Adviser promptly of each purchase and
sale of a Fund security, specifying the name of the issuer, the description and
amount or number of shares of the security purchased, the market price, the
commission and gross or net price, the trade date and settlement date, the
identity of the effecting broker or dealer and any other pertinent data that the
Fund’s custodian may need to settle a security’s purchase or sale. The
Subadviser shall not have possession or custody of the Fund’s investments. The
Fund shall be responsible for all custodial agreements and the payment of all
custodial charges and fees and, upon the Subadviser giving proper instructions
to the custodian, the Subadviser shall have no responsibility or liability for
the acts, omissions or other conduct of the custodian.
The
Subadviser agrees that it shall not direct Fund transactions for the Fund
through any broker or dealer that is an “affiliated person” of the Subadviser
(as that term is defined in the 1940 Act or interpreted under applicable rules
and regulations of the Commission), except as permitted under the 1940 Act. The
Adviser agrees that it will provide the Subadviser with a list of brokers and
dealers that are affiliated persons of the Fund, or affiliated persons of such
persons, and shall timely update that list as the need arises. The Adviser
agrees that any entity or person associated with the Adviser or the Subadviser
that is a member of a national securities exchange is authorized to effect any
transaction on such exchange for the account of the Trust that is permitted by
Section 11(a) of the Exchange Act, and the Adviser consents to the retention of
compensation for such transactions.
(c) Expenses.
The Subadviser, at its expense, will furnish all necessary facilities and
personnel, including salaries, expenses and fees of any personnel required for
them to faithfully perform their duties under this Agreement and administrative
facilities, including bookkeeping, and all equipment necessary for the efficient
conduct of the Subadviser’s duties under this Agreement. However, the Subadviser
shall not be obligated to pay any expenses of the Adviser, the Fund, or the
Trust, including without limitation, interest and taxes, brokerage commissions
and other costs in connection with the purchase or sale of securities or other
investment instruments for the Fund and custodian fees and
expenses.
(d) Valuation.
Securities traded on a national securities exchange or The Nasdaq Stock Market
for which market quotes are readily available are valued on each day the New
York Stock Exchange is open for business. For those securities for which market
quotes are not readily available, the Subadviser, at its expense and in
accordance with procedures and methods established by the Board, which may be
amended from time to time, will provide assistance to the Adviser, or other
applicable service providers for the Trust and the Fund, in determining the fair
value of such securities, including providing market price information relating
to these assets of the Fund. The Subadviser also shall monitor for “significant
events” that occur after the closing of a market but before the time as of which
the Fund calculates its net asset value and that may affect the valuation of the
Fund’s Fund securities and shall notify the Adviser promptly of the occurrence
of any such events.
(e) Reports
and Availability of Personnel.
The Subadviser, at its expense, shall render to the Board and the Adviser such
periodic and special reports as the Board and the Adviser reasonably may request
with respect to matters relating to the duties of the Subadviser set forth
herein. The Subadviser, at its expense, will make available to the Board and the
Adviser at reasonable times its Fund managers and other appropriate personnel in
order to review investment policies of the Fund and to consult with the Board
and the Adviser regarding the investment affairs of the Fund, including
economic, statistical and investment matters relevant to the Subadviser’s duties
hereunder.
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(f) Compliance
Matters.
The Subadviser, at its expense, will provide the Adviser with such compliance
reports relating to its duties under this Agreement as may be agreed upon by
such parties from time to time. The Subadviser also shall cooperate with and
provide reasonable assistance to the Adviser, the Fund’s administrator, the
Fund’s custodian, the Fund’s transfer agent and pricing agents and all other
agents and representatives of the Fund, the Trust and the Adviser, keep all such
persons fully informed as to such matters as they may reasonably deem necessary
to the performance of their obligations to the Fund, the Trust and the Adviser,
provide prompt responses to reasonable requests made by such persons and
maintain any appropriate interfaces with each so as to promote the efficient
exchange of information.
(g) Books
and Records.
The Subadviser will maintain for the Fund all books and records required to be
maintained by the Fund pursuant to the 1940 Act and the rules and regulations
promulgated thereunder insofar as such records relate to the investment affairs
of the Fund. Pursuant to Rule 31a-3 under the 1940 Act, the Subadviser agrees
that: (i) all records it maintains for the Fund are the property of the Fund;
(ii) it will surrender promptly to the Fund or the Adviser any such records upon
the Fund’s or the Adviser’s request; and (iii) it will preserve for the periods
prescribed by Rule 31a-2 under the 1940 Act the records it maintains for the
Fund. Notwithstanding subsection (ii) above, the Subadviser may maintain copies
of such records, without limitation, to comply with its record keeping
obligations.
(h) Proxies.
The Subadviser will, unless and until otherwise directed by the Adviser or the
Board, vote proxies with respect to the Fund’s securities and exercise rights in
corporate actions or otherwise in accordance with the Subadviser’s
proxy
voting guidelines, as amended from time to time.
2. Compensation.
The Adviser shall pay to the Subadviser as compensation for the Subadviser’s
services rendered pursuant to this Agreement a subadvisory fee as set forth in
Schedule A, which schedule can be modified from time to time, subject to the
appropriate approvals required by the 1940 Act. Such fees shall be paid by the
Adviser (and not by the Fund). Such fees shall be payable for each month within
15 business days after the end of such month. If the Subadviser shall serve for
less than the whole of a month, the compensation as specified shall be prorated
based on the number of calendar days during which this Agreement is in effect
during such month, and the fee shall be computed based upon the average daily
net assets of the Fund for such days.
3. Representations
And Warranties.
(a) Subadviser.
The Subadviser represents and warrants to the Adviser that: (i) the retention of
the Subadviser by the Adviser as contemplated by this Agreement is authorized by
the Subadviser's governing documents; (ii) the execution, delivery and
performance of this Agreement does not violate any obligation by which the
Subadviser or its property is bound, whether arising by contract, operation of
law or otherwise; (iii) this Agreement has been duly authorized by appropriate
action of the Subadviser and when executed and delivered by the Subadviser will
be a legal, valid and binding obligation of the Subadviser, enforceable against
the Subadviser in accordance with its terms, subject, as to enforcement, to
applicable bankruptcy, insolvency and similar laws affecting creditors’ rights
generally and to general equitable principles (regardless of whether enforcement
is sought in a proceeding in equity or law); (iv) the Subadviser is registered
as an investment adviser under the Advisers Act; (v) the Subadviser has adopted
a written code of ethics complying with the requirements of Rule 17j-1 under the
1940 Act and that the Subadviser and certain of its employees, officers and
directors are subject to reporting requirements thereunder and, accordingly,
agrees that it shall, on a timely and
reasonable basis,
furnish a copy of such code of ethics to the Adviser, and requisite
certifications as from the time reasonably requested; (vi) the Subadviser is not
prohibited by the 1940 Act, the Advisers Act or other law, regulation or order
from performing the services contemplated by this Agreement; (vii) the
Subadviser will promptly notify the Adviser of the occurrence of any event that
would disqualify the Subadviser from serving as investment subadviser of an
investment company pursuant to Section 9(a) of the 1940 Act or otherwise; (viii)
the Subadviser has provided the Adviser with a copy of its Form ADV as most
recently filed with the SEC and will furnish a copy of all amendments to the
Adviser at least annually; and (ix) the Subadviser will notify the Adviser of
any “assignment” (as defined in the 0000 Xxx) of this Agreement or change of
control of the Subadviser, as applicable, and any changes in the key personnel
who are the Fund managers of the Fund, in each case prior to or promptly after,
such change.
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(b) Adviser.
The Adviser represents and warrants to the Subadviser that: (i) the retention of
the Subadviser by the Adviser as contemplated by this Agreement is authorized by
the respective governing documents of the Trust and the Adviser; (ii) the
execution, delivery and performance of each of this Agreement and the Advisory
Agreement does not violate any obligation by which the Trust or the Adviser or
their respective property is bound, whether arising by contract, operation of
law or otherwise; (iii) each of this Agreement and the Advisory Agreement has
been duly authorized by appropriate action of the Trust and the Adviser and when
executed and delivered by the Adviser will be a legal, valid and binding
obligation of the Fund, the Trust and the Adviser, enforceable against the Trust
and the Adviser in accordance with its terms, subject, as to enforcement, to
applicable bankruptcy, insolvency and similar laws affecting creditors’ rights
generally and to general equitable principles (regardless of whether enforcement
is sought in a proceeding in equity or law); (iv) the Adviser is registered as
an investment adviser under the Advisers Act; (v) the Adviser has adopted a
written code of ethics complying with the requirements of Rule 17j-1 under the
1940 Act and that the Adviser and certain of its employees, officers and
directors are subject to reporting requirements thereunder; (vi) the Adviser is
not prohibited by the 1940 Act, the Advisers Act or other law, regulation or
order from performing the services contemplated by this Agreement; and (vii) the
Adviser will promptly notify the Subadviser of the occurrence of any event that
would disqualify the Adviser from serving as investment manager of an investment
company pursuant to Section 9(a) of the 1940 Act or otherwise.
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4. Liability
of the Subadviser. In
the absence of (a) bad faith, negligence or willful misfeasance on the part of
the Subadviser in performance of its obligations and duties hereunder, (b)
reckless disregard by the Subadviser of its obligations and duties hereunder, or
(c) a loss resulting from a breach of the Subadviser’s fiduciary duty with
respect to the receipt of compensation for services (in which case any award of
damages shall be limited to the period and the amount set forth in Section
36(b)(3) of the 1940 Act), the Subadviser shall not be subject to any liability
whatsoever to the Adviser, the Fund, the Trust, or to any shareholder of the
Fund, for any error or judgment, mistake of law or any other act or omission in
the course of, or connected with, rendering services hereunder including,
without limitation, for any losses that may be sustained in connection with the
purchase, holding, redemption or sale of any security on behalf of the Fund. No
provision of this Section 4 is intended to create any rights whatsoever to any
third parties, including without limitation the shareholders of the Fund.
However,
the Subadviser shall indemnify and hold harmless such parties from any and all
claims, losses, expenses, obligations and liabilities (including reasonable
attorneys fees) that arise or result from that specified in Subsections (a)
through (c) above.
5. Liability
of the Adviser. In
the absence of (a) bad faith, negligence or willful misfeasance on the part of
the Adviser in performance of its obligations and duties hereunder, (b) reckless
disregard by the Adviser of its obligations and duties hereunder, or (c) a loss
resulting from a breach of the Adviser’s fiduciary duty with respect to the
receipt of compensation for services (in which case any award of damages shall
be limited to the period and the amount set forth in Section 36(b)(3) of the
1940 Act), the Adviser shall not be subject to any liability whatsoever to the
Subadviser, the Fund, the Trust, or to any shareholder of the Fund, for any
error or judgment, mistake of law or any other act or omission in the course of,
or connected with, rendering services hereunder including, without limitation,
for any losses that may be sustained in connection with the purchase, holding,
redemption or sale of any security on behalf of the Fund. No provision of this
Section 5 is intended to create any rights whatsoever to any third parties,
including without limitation the shareholders of the Fund. However,
the Adviser shall indemnify and hold harmless such parties from any and all
claims, losses, expenses, obligations and liabilities (including reasonable
attorneys fees) that arise or result from that specified in Subsections (a)
through (c) above.
6. Liability
of Trustees and Shareholders.
Any obligations of the Fund under this Agreement are not binding upon the
Trustees or the shareholders individually but are binding only upon the assets
and property of the Fund.
7. Duration
and Termination of the Agreement.
This Agreement shall become effective upon its execution; provided, however,
that this Agreement shall not become effective unless it has first been approved
(a) by a vote of the Independent Trustees, cast in person at a meeting called
for the purpose of voting on such approval, and (b) by an affirmative vote of a
majority of the outstanding voting shares of the Fund. This Agreement shall
remain in full force and effect continuously thereafter, except as
follows:
(a) By
vote of a majority of the (i) Independent Trustees, or (ii) outstanding voting
shares of the Fund, the Fund may at any time terminate this Agreement, without
the payment of any penalty, by providing not more than 60 days’ written notice
delivered or mailed by registered mail, postage prepaid, to the Adviser and the
Subadviser.
(b) This
Agreement will terminate automatically, without the payment of any penalty,
unless within two years after its initial effectiveness and at least annually
thereafter, the continuance of the Agreement is specifically approved by (i) the
Board of Trustees or the shareholders of the Fund by the affirmative vote of a
majority of the outstanding shares of the Fund, and (ii) a majority of the
Independent Trustees, by vote cast in person at a meeting called for the purpose
of voting on such approval. If the continuance of this Agreement is submitted to
the shareholders of the Fund for their approval and such shareholders fail to
approve such continuance as provided herein, the Subadviser may continue to
serve hereunder in a manner consistent with the 1940 Act and the rules
thereunder.
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(c) The
Adviser may at any time terminate this Agreement, without the payment of any
penalty, by not less than 60 days’ written notice delivered or mailed by
registered mail, postage prepaid, to the Subadviser, and the Subadviser may at
any time, without the payment of any penalty, terminate this Agreement by not
less than 90 days’ written notice delivered or mailed by registered mail,
postage prepaid, to the Adviser.
(d) This
Agreement automatically and immediately shall terminate, without the payment of
any penalty, in the event of its assignment or if the Investment Advisory
Agreement between the Adviser and the Fund shall terminate for any
reason.
(e) Any
notice of termination served on the Subadviser by the Adviser shall be without
prejudice to the obligation of the Subadviser to complete transactions already
initiated or acted upon with respect to the Fund. Upon termination without
reasonable notice by the Adviser, the Subadviser will be paid certain previously
agreed upon expenses the Subadviser necessarily incurs in terminating the
Agreement.
Upon
termination of this Agreement, the duties of the Adviser delegated to the
Subadviser under this Agreement automatically shall revert to the
Adviser.
8. Amendment
of 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 whom
enforcement of the change, waiver, discharge or termination is sought. No
material amendment of this Agreement shall be effective until approved in the
manner required by the 1940 Act, any rules thereunder or any exemptive or other
relief granted by the SEC or its staff.
9. Additional
Agreements.
(a) Other
Advisory Agreements.
The Subadviser and persons controlled by or under common control with the
Subadviser have and may have advisory, management service or other agreements
with other organizations and persons, and may have other interests and
businesses. Nothing in this Agreement is intended to preclude such other
business relationships. However, the Subadviser agrees that through the third
anniversary of the Effective Date of this Agreement, the Subadviser will not act
as a subadviser, whereby it provides
a continuous investment program, to
a high yield bond Fund (whether a mutual fund or a Fund offered as part of an
insurance product) designed to appeal primarily to market timers or other active
managers.
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(b) Access
to Information.
The Subadviser shall, upon reasonable notice, afford the Adviser at all
reasonable times access to Subadviser's officers, employees, agents and offices
and to all its relevant books and records and shall furnish the Adviser with all
relevant financial and other data and information as requested; provided,
however, that nothing contained herein shall obligate the Subadviser to provide
the Adviser with access to the books and records of the Subadviser relating to
any other accounts other than the Fund.
(c) Confidentiality.
The Subadviser shall treat confidentially and as proprietary information of the
Trust and the Fund all records and information (including investment holdings
and activities of the Fund) relative to the Trust and the Fund and prior,
present or potential shareholders, and will not use such records and information
for any purpose other than performance of its responsibilities and duties
hereunder, except after prior notification to and approval in writing by the
Trust, which approval shall not be unreasonably withheld and may not be withheld
where the Subadviser may be exposed to civil or criminal contempt proceedings
for failure to comply, when requested to divulge such information by duly
constituted authorities, or when so requested by the Trust. Notwithstanding the
above, the Subadviser may disclose: (i) the identity of the Trust and the Fund
as part of any representative list of clients of the Subadviser; (ii) the
investment results and other data of the Fund (without identifying the Fund or
the Trust) in connection with providing composite investment results of clients
of the Subadviser; and (iii) investments and transactions with respect to the
Fund (without identifying the Trust or the Fund) in connection with providing
composite information of clients of the Subadviser, provided that such
disclosure will not be made in such a manner that may reasonably have an adverse
effect on the trading activities of the Fund.
(d) Public
Announcements.
No party shall issue any press release or otherwise make any public statements
with respect to the matters covered by this Agreement without the prior written
consent of the other parties hereto, which consent shall not be unreasonably
withheld; provided, however, that consent shall not be required if, in the
opinion of counsel, such disclosure is required by law; provided further,
however, that the party making such disclosure shall provide the other parties
hereto with as much prior written notice of such disclosure as is practical
under the circumstances.
(e) Notifications.
The Subadviser agrees that it will promptly notify the Adviser in the event that
the Subadviser is or expects to become the subject of an administrative
proceeding or enforcement action by the Commission or other regulatory body with
applicable jurisdiction. Similarly,
the Adviser agrees that it will promptly notify Subadviser in the event that
Adviser is or expects to become the subject of an administrative proceeding or
enforcement action by the Commission or other regulatory body with applicable
jurisdiction.
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(f) Insurance.
The Subadviser agrees to maintain errors and omissions or professional liability
insurance coverage in an amount that is reasonable in light of the nature and
scope of the Subadviser's business activities.
(g) Shareholder
Meeting Expenses.
In the event that the Trust shall be required to call a meeting of shareholders
solely due to actions involving the Subadviser, including, without limitation, a
change of control of the Subadviser, the Subadviser shall bear all reasonable
expenses associated with such shareholder meeting.
10. Notices.
All notices or other communications given under this Agreement shall be made by
guaranteed overnight delivery, telecopy or certified mail; notice is effective
when received. Notice shall be given to the parties at the following
addresses:
Adviser:
Xxxxxxxx
Asset Management LLC
00
Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx
Xxxx, XX 00000
Facsimile
No.: (000) 000-0000
Attention:
Xxxxxx X. X’Xxxxx
Subadviser:
Transamerica
Investment Management, LLC
000
Xxxxx Xxxx Xxxxxx
Xxxxxx,
Xxxx 00000
Facsimile
No.: (000) 000-0000
Attention:
Xxxx X. Xxxxxxx
11. Definitions.
For the purposes of this Agreement, the terms “vote of a majority of the
outstanding shares,” “affiliated person,” “control,” “interested person” and
“assignment” shall have their respective meanings as defined in the 1940 Act and
the rules thereunder subject, however, to such exemptions as may be granted by
the Securities and Exchange Commission (“SEC”) under said Act; and references to
annual approvals by the Board of Trustees shall be construed in a manner
consistent with the 1940 Act and the rules thereunder.
12. Governing
Law.
This Agreement shall be construed in accordance with the laws of the
Commonwealth of Massachusetts, without giving effect to the conflicts of laws
principles thereof, and in accordance with the 1940 Act. To the extent that the
applicable laws of the Commonwealth of Massachusetts conflict with the
applicable provisions of the 1940 Act, the latter shall control.
13. 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. This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors.
14. Counterparts.
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.
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15. Entire
Agreement.
This Agreement states the entire agreement of the parties hereto, and is
intended to be the complete and exclusive statement of the terms hereof.
16. Miscellaneous.
The captions in this Agreement are included for convenience of reference only
and in no way define or delimit any of the provisions hereof or otherwise affect
their construction or effect. Where the effect of a requirement of the 1940 Act
reflected in any provision of this Agreement is made less restrictive by a rule,
or order of the SEC, whether of special or general application, such provision
shall be deemed to incorporate the effect of such rule, or order.
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IN
WITNESS WHEREOF, Xxxxxxxx Asset Management, LLC and Transamerica
Investment Management, LLC
have each caused this instrument to be signed in duplicate on its behalf by its
duly authorized representative, all as of the day and year first above
written.
|
Attest: |
XXXXXXXX
ASSET MANAGEMENT, LLC |
|
By:
|
By:/s/
Xxxxxx X. X’Xxxxx |
|
Name:
Xxxxxx X. X’Xxxxx | |
|
Title:
Managing Director | |
|
Attest: |
TRANSAMERICA
INVESTMENT |
|
MANAGEMENT,
LLC | |
|
By:
|
By:
/s/
Xxxx X. Xxxxxxx |
|
Controller |
Name:
Xxxx X. Xxxxxxx |
|
Title:
Corporate Vice President |
11
SCHEDULE
A
TO
THE
BETWEEN
XXXXXXXX
ASSET MANAGEMENT, LLC
AND
TRANSAMERICA
INVESTMENT MANAGEMENT, LLC
As
compensation pursuant to section 2 of the Subadvisory Agreement between Xxxxxxxx
Asset Management, LLC (the “Adviser”) and Transamerica Investment Management,
LLC (the “Subadviser”), the Adviser shall pay the Subadviser a subadvisory fee,
computed and paid monthly, at the following annual percentage rates of the
average daily net assets under management by the Subadviser:
Less
than $25
Million:
0.50%
Between
$25 million and $75 Million: 0.40%
Between
$75 Million and $100 Million:
0.30%
Over
$100
Million:
0.25%
Solely
for the purpose of determining the applicable percentage rate under the
foregoing schedule, average daily net assets under management by the Subadviser
shall be the aggregate of the assets in the Dynamic XX Xxxx Fund, the HY Bear
Fund and the VP Dynamic XX Xxxx Fund, a series of the Potomac Insurance
Trust.
Dated:
July 1, 2005
12
