INVESTMENT SUB-ADVISORY AGREEMENT
AGREEMENT
made as
of the 29th day of June 2006, by and among Xxxxx Investment Research, Inc.,
an Ohio corporation located at 0000 Xxxxxxxxxxx Xxxx, Xxxxx, Xxxx 00000 (the
“Sub-Adviser”),
Sincere Investment Management, LLC, a Delaware limited liability company located
at X.X. Xxx 0000, Xxxxxxxxx, Xxxxxxxxxxxxx 00000 (the “Manager”),
and
Advisors Series Trust, a Delaware statutory trust located at 000 Xxxx Xxxxxxxx
Xxxxxx, Xxxxxxxxx, XX 00000 (the “Trust”),
on
behalf of Sincere Advisor Small Cap Fund, a series of the Trust (the
“Fund”).
WHEREAS,
the
Manager and its affiliates are engaged in the business of creating and marketing
mutual funds; and
WHEREAS,
the
Sub-Adviser is engaged in the business of rendering investment advice; and
WHEREAS,
the
Manager and the Sub-Adviser are each registered as investment advisors under
the
Investment Advisers Act of 1940; and
WHEREAS,
the
Fund is a separate series of the Trust having separate assets and liabilities;
and
WHEREAS,
the
Fund has retained the Manager to render certain management services to the
Fund
pursuant to an Investment Management Agreement dated as of June 29, 2006 (the
“Management
Agreement”);
and
WHEREAS,
the
Fund and the Manager have retained the Sub-Adviser to render investment advisory
services to the Fund pursuant to this Investment Sub-Advisory Agreement (the
“Agreement”).
NOW,
THEREFORE, WITNESSETH:
That it
is hereby agreed among the parties hereto as follows:
| 1. |
APPOINTMENT
OF SUB-ADVISER.
|
| (a) |
Acceptance.
The Sub-Adviser is hereby appointed and the Sub-Adviser hereby accepts
the
appointment, on the terms herein set forth and for the compensation
herein
provided, to act as investment adviser to the
Fund.
|
| (b) |
Independent
Contractor.
The Sub-Adviser shall for all purposes herein be deemed to be an
independent contractor and shall, unless otherwise expressly provided
or
authorized, have no authority to act for or be deemed an agent of
the
Fund.
|
| (c) |
The
Sub-Adviser’s Representations.
The Sub-Adviser represents, warrants and agrees that it has all requisite
power and authority to enter into and perform its obligations under
this
Agreement, and has taken all necessary corporate action to authorize
its
execution, delivery and performance of this Agreement. The Sub-Adviser
represents, warrants and agrees that it is registered as an adviser
under
the Investment Advisers Act of 1940, as
amended.
|
| (d) |
The
Manager’s Representations.
The Manager represents, warrants and agrees that it has all requisite
power and authority to enter into and perform its obligations under
this
Agreement, and has taken all necessary corporate action to authorize
its
execution, delivery and performance of this Agreement. The Manager
further
represents, warrants and agrees that it has the authority under the
Management Agreement to appoint the Sub-Adviser. The Manager further
represents and warrants that it
has received a copy of Part II of the Sub-Adviser’s Form ADV. The Manager
further represents and warrants that the
Fund is either (i) excluded from the definition of the term “pool” under
Section 4.5 of the General Regulations under the Commodity Exchange
Act
(“Rule
4.5”),
or (ii) a qualifying entity under Rule 4.5(b) for which a notice
of
eligibility has been filed.
|
| (e) |
Plenary
authority of the Board of Trustees.
The Sub-Adviser and Manager both acknowledge that the Fund is a mutual
fund that operates as a series of the Trust under the authority of
the
Board of Trustees.
|
| (f) |
The
Trust’s Representations.
The Trust represents, warrants and agrees that it has all requisite
power
and authority to enter into and perform its obligations under this
Agreement, and has taken all necessary action to authorize its execution,
delivery and performance of this Agreement.
|
| 2. |
PROVISION
OF INVESTMENT SUB-ADVISORY
SERVICES.
|
The
Sub-Adviser will provide for the Fund a continuing and suitable investment
program consistent with the investment policies, objectives and restrictions
of
the Fund, as established by the Fund and the Manager and provided to the
Sub-Adviser in writing. The current policies, objectives and restrictions are
attached hereto as Exhibit
A.
From
time to time, the Manager or the Fund may provide the Sub-Adviser with written
copies of additional or amended investment policies, guidelines and
restrictions, which shall become effective at such time as agreed upon by all
parties. The Sub-Adviser will manage the investment and reinvestment of the
assets in the Fund, and perform the functions set forth below, subject to the
overall supervision, direction, control and review of the Manager, consistent
with the applicable investment policies, guidelines and restrictions, or any
directions or instructions delivered to the Sub-Adviser in writing by the
Manager or the Fund from time to time, and further subject to the plenary
authority of the Fund’s Board of Trustees. Consistent with Exhibit
A,
or
unless otherwise directed in writing by the Manager or the Fund, the Sub-Adviser
shall have full discretionary authority to manage the investment of the assets
in the Fund, including the authority to purchase, sell, cover open positions,
and generally to deal in securities, financial and commodity futures contracts,
options, short-term investment vehicles and other property comprising or
relating to the Fund.
In
addition, the Sub-Adviser will, at its own expense:
| (a) |
advise
the Manager and the Fund in connection with investment policy decisions
to
be made by it regarding the Fund and, upon request, furnish the Manager
and the Fund with non-proprietary research, economic and statistical
data
in connection with the Fund’s investments and investment
policies;
|
| (b) |
if
the value of a security must be determined in accordance with the
Trust’s
fair value pricing procedures, submit such reports and information
as the
Manager or the Fund may reasonably request to assist the Fund’s custodian
(the “Custodian”)
in its determination of the market value of securities held in the
Fund
;
|
| (c) |
place
orders for purchases and sales of portfolio investments for the Fund;
|
| (d) |
give
instructions to the Custodian concerning the delivery of securities
and
transfer of cash for the Fund;
|
| (e) |
maintain
and preserve the records relating to its activities hereunder required
by
applicable law to be maintained and preserved by the Fund’s investment
adviser, to the extent not maintained by the Manager or another agent
of
the Fund, and the Sub-Adviser hereby agrees that all records which
it
maintains for the Fund are the property of the Fund and further agrees
to
surrender promptly to the Fund copies of any such records upon the
Fund’s
request;
|
| (f) |
as
soon as practicable after the close of business each day but no later
than
11:00 a.m. Eastern time the following business day, provide the Custodian
with copies of trade tickets for each transaction effected for the
Fund,
provide copies to the Manager and the Fund upon request, and promptly
forward to the Custodian copies of all brokerage or dealer
confirmations;
|
| (g) |
as
soon as practicable following the end of each calendar month, provide
the
Manager and the Fund with written statements showing all transactions
effected for the Fund during the month, a summary listing all investments
held in the Fund as of the last day of the month, and such other
information as the Manager or the Fund may reasonably request in
connection with any accounting or marketing services that the Manager
provides for the Fund;
|
| (h) |
absent
specific instructions to the contrary provided to it by the Manager
or the
Fund, and subject to its receipt of all necessary voting materials,
vote
all proxies with respect to investments of the Fund in accordance
with the
Sub-Adviser’s proxy voting policy as most recently provided to the
Manager;
|
| (i) |
To
the extent reasonably requested by the Trust, use its best efforts
to
assist the Chief Compliance Officer of the Trust in respect of Rule
38a-1
under the 1940 Act, as amended (the “1940
Act”)
including, without limitation, providing the Chief Compliance Officer
of
the Trust with (a) current copies of the compliance policies and
procedures of the Sub-Adviser in effect from time to time (including
prompt notice of any material changes thereto), (b) a summary of
such
policies and procedures in connection with the annual review thereof
by
the Trust required under Rule 38a-1, and (c) upon request, a certificate
of the chief compliance officer of the Sub-Adviser to the effect
that the
policies and procedures of the Sub-Adviser are reasonably designed
to
prevent violation of the Federal Securities Laws (as such term is
defined
in Rule 38a-1); and
|
| (j) |
Except
as permitted by the Trust’s policies and procedures, not disclose but
shall treat confidentially all information in respect of the portfolio
investments of the Fund, including, without limitation, the identification
and market value or other pricing information of any and all portfolio
securities or other financial instruments held by the Fund, and any
and
all trades of portfolio securities or other transactions effected
for the
Fund (including past, pending and proposed trades). The Trust and
the
Manager acknowledge that the Sub-Adviser acts as adviser to other
funds
and accounts with portfolios substantially similar to the Fund’s
portfolio, and agree that the Sub-Adviser’s actions in the ordinary course
of managing those funds and accounts shall not constitute disclosure
of
the Fund’s portfolio investments.
|
The
Trust
or its agent will provide information to the Sub-Adviser regarding such matters
as inflows to and outflows from the Fund and the cash requirements of, and
cash
available for investment in, the Fund every morning before the New York Stock
Exchange (NYSE) opens. Each day the NYSE is open, the Fund or its agent will
provide the Sub-Adviser with copies of the following reports: 1) an NAV Impact
of Price Changes report, 2) a Statement of the Fund Assets and Liabilities,
3) a
Daily Price Variance Report (in both dollars and percentage charges), 4) a
Schedule of Portfolio Holdings, 5) a Stale Price Report (showing securities
with
no change in price or no price available), and such other information as may
be
reasonably necessary or appropriate in order for the Sub-Adviser to perform
its
responsibilities hereunder. These reports will be emailed to the Sub-Adviser
as
requested before the NYSE opens.
The
Manager and the Trust acknowledge that the Sub-Adviser is not responsible for
any fund accounting, including NAV calculations, and is not required to value
securities except to the extent that the Sub-Adviser is requested to participate
in a fair value determination. Furthermore, the Sub-Advisor is not required
to
produce any regulatory reports that the Fund is required to file with regulators
or deliver to shareholders, such as an annual or semi-annual report or any
quarterly filings with the SEC, but will reasonably cooperate with the Fund
and
the Manager with the preparation of such reports.
The
Manager and the Trust acknowledge that the Sub-Adviser is not responsible for
any activities generally performed by a mutual fund accountant, transfer agent,
custodian, fund administrator, fund underwriter or distributor.
The
Manager hereby delegates to the Sub-Adviser the Manager’s discretionary
authority to exercise voting rights with respect to the securities and
investments of the Fund. The Sub-Adviser’s proxy voting policies shall comply
with any rules or regulations promulgated by the SEC.
The
Sub-Adviser shall maintain and preserve a record, in an easily-accessible place
for a period of not less than three (3) years (or longer, if required by law),
of the Sub-Adviser’s voting procedures, of the Sub-Adviser’s actual votes, and
such other information required for the Fund to comply with any rules or
regulations promulgated by the SEC. The Sub-Adviser shall supply updates of
this
record to the Manager or any authorized representative of the Manager, or to
the
Fund on a quarterly basis (or more frequently, if required by law). The
Sub-Adviser shall provide the Manager and the Fund with information regarding
the policies and procedures that the Sub-Adviser uses to determine how to vote
proxies relating to the Fund. The Fund may request that the Sub-Adviser vote
proxies for the Fund in accordance with the Fund’s proxy voting
policies.
| 3. |
ALLOCATION
OF EXPENSES.
|
Each
party to this Agreement shall bear the costs and expenses of performing its
obligations hereunder. In this regard, the Trust and Manager agree that the
Fund
or the Manager shall pay all expenses of the Fund unless the expense is
specifically assumed by the Sub-Adviser.
The
Sub-Adviser specifically agrees that with respect to its services rendered
to
the Fund, the Sub-Adviser shall be responsible for (i) providing the personnel,
office space and equipment reasonably necessary to fulfill its obligations
as
Sub-Adviser, and (ii) the costs of any special Board of Trustees meetings or
shareholder meetings convened for the primary benefit of the Sub-Adviser,
provided such costs are pre-approved in writing by the Sub-Adviser . If the
Manager has agreed, or in the future agrees, to limit the operating expenses
of
the Fund, the Manager shall also be solely responsible on a monthly basis for
any operating expenses that exceed the agreed upon expense limit. Any fee waiver
or expense reimbursement by the Manager will not alter the Manager’s obligations
under this Agreement. Nothing in this Agreement shall alter the allocation
of
expenses and costs agreed upon between the Fund and the Manager in the
Management Agreement or any other agreement to which they are
parties.
| 4. |
SUB-ADVISORY
FEES.
|
For
all
of the services rendered with respect to the Fund as herein provided, the
Manager shall pay to the Sub-Adviser a fee (for the payment of which the Fund
shall have no obligation or liability), based on the Current Net Assets of
the
Fund (as defined below), as set forth in Schedule B attached hereto and made
a
part hereof. Such fee shall be accrued daily and payable quarterly, as soon
as
practicable after the last day of each calendar quarter. In the case of
termination of this Agreement with respect to the Fund during any calendar
month, the fee with respect to such Portfolio accrued to, but excluding, the
date of termination shall be paid promptly following such termination. For
purposes of computing the amount of advisory fee accrued for any day, “Current
Net Assets” shall mean the Fund’s net assets as of the most recent preceding day
for which the Fund’s net assets were computed.
| 5. |
PORTFOLIO
TRANSACTIONS.
|
In
connection with the investment and reinvestment of the assets of the Fund,
the
Sub-Adviser is authorized to select the brokers or dealers that will execute
purchase and sale transactions for the Fund’s portfolio (the “Portfolio”)
and to
use all reasonable efforts to obtain the best available price and most favorable
execution with respect to all such purchases and sales of portfolio securities
for said Portfolio. The Sub-Adviser shall maintain records adequate to
demonstrate compliance with the requirements of this section. Subject to the
policies as the Board of Trustees of the Fund may determine and consistent
with
Section 28(e) of the Securities Exchange Act of 1934, as amended, the
Sub-Adviser shall have the right to follow a policy of selecting brokers who
furnish brokerage and research services to the Fund or to the Sub-Adviser and
who charge a higher commission rate to the Fund than may result when allocating
brokerage solely on the basis of seeking the most favorable price and execution.
The Sub-Adviser shall determine in good faith that such higher cost was
reasonable in relation to the value of the brokerage and research services
provided and shall make reasonable reports regarding such determination and
description of the products and services obtained if so requested by the
Fund.
The
Manager and the Trust authorize and empower the Sub-Adviser to direct the
Custodian to open and maintain brokerage accounts for securities and other
property (all such accounts hereinafter called “brokerage
accounts”)
for
and in the name of the Fund and to execute for the Fund as its agent and
attorney-in-fact standard customer agreements with such broker or brokers as
the
Sub-Adviser shall select as provided above. The Sub-Adviser may, using such
of
the securities and other property in the Fund as the Sub-Adviser deems necessary
or desirable, direct the Custodian to deposit for the Fund original and
maintenance brokerage and margin deposits and otherwise direct payments of
cash,
cash equivalents and securities and other property into such brokerage accounts
and to such brokers as the Sub-Adviser deems desirable or appropriate. The
Sub-Adviser shall cause all securities and other property purchased or sold
for
the Fund to be settled at the place of business of the Custodian or as the
Custodian shall direct. All securities and other property of the Fund shall
remain in the direct or indirect custody of the Custodian. The Sub-Adviser
shall
notify the Custodian as soon as practicable of the necessary information to
enable the Custodian to effect such purchases and sales.
The
Sub-Adviser further shall have the authority to instruct the Custodian (i)
to
pay cash for securities and other property delivered to the Custodian for the
Fund, (ii) to deliver securities and other property against payment for the
Fund, and (iii) to transfer assets and funds to such brokerage accounts as
the
Sub-Adviser may designate, all consistent with the powers, authorities and
limitations set forth herein. The Sub-Adviser shall not have authority to cause
the Custodian to deliver securities and other property, or pay cash to the
Sub-Adviser except as expressly provided herein.
| 6. |
LIABILITY;
STANDARD OF CARE.
|
The
Sub-Adviser, its affiliates, agents, officers and directors and employees,
shall
be indemnified by the Manager against all liabilities, losses or claims
(including reasonable expenses arising out of defending such liabilities, losses
or claims):
| (a) |
arising
from Fund’s or the Manager’s directions to the Sub-Adviser or Custodian,
or brokers, dealers or others with respect to the making, retention
or
sale of any investment or reinvestment hereunder;
or
|
| (b) |
arising
from the acts or omissions of the Manager, the Custodian or the Fund,
their respective affiliates, agents or
employees;
|
except
for any such liability or loss which is due to the gross negligence willful
misconduct, or lack of good faith of the Sub-Adviser, its affiliates, agents,
officers, directors and employees, or the Sub-Adviser’s reckless disregard of
its duties and obligations. The Sub-Adviser, its affiliates, agents, officers,
directors and employees shall also be without liability hereunder, and
indemnified by the Manager, for any action taken or omitted by it in good faith
and without gross negligence.
The
Sub-Adviser shall comply with all applicable laws and regulations in the
discharge of its duties under this Agreement; shall (as provided in Section
2
above) comply with the investment policies, guidelines and restrictions of
the
Fund; shall act at all times in the best interests of the Fund; and shall
discharge its duties with the care, skill, prudence and diligence under the
circumstances then prevailing that a prudent person acting in a like capacity
and familiar with such matters would use in the conduct of a similar enterprise.
It
is
agreed that the Sub-Advisor shall have no responsibility or liability for the
accuracy or completeness of the Trust’s Registration Statement under the 1940
Act or the Securities Act of 1933, as amended, except for information supplied
by the Sub-Advisor for inclusion therein.
However,
the Sub-Adviser shall not be obligated to perform any service not described
in
this Agreement, and shall not be deemed by virtue of this Agreement to have
made
any representation or warranty that any level of investment performance or
level
of investment results will be achieved.
| 7. |
TERM
AND TERMINATION OF THIS AGREEMENT; NO
ASSIGNMENT
|
(a) This
Agreement shall go into effect as to the Fund on the date set forth above and
shall, unless terminated as hereinafter provided, continue in effect for a
period of two years. This Agreement shall continue in effect thereafter for
additional periods not exceeding one (l) year so long as such continuation
is
approved for the Fund at least annually by (i) the Board of Trustees of the
Trust or by the vote of a majority of the outstanding voting securities of
the
Fund and (ii) the vote of a majority of the Trustees of the Trust who are not
parties to this Agreement nor interested persons thereof, cast in person at
a
meeting called for the purpose of voting on such approval. The terms “majority
of the outstanding voting securities” and “interested persons” shall have the
meanings as set forth in the 1940 Act;
(b) This
Agreement may be terminated by the Trust on behalf of the Fund at any time
without payment of any penalty, by the Board of Trustees of the Trust, by the
Manager, or by vote of a majority of the outstanding voting securities of a
Fund
without the payment of any penalties, upon sixty (60) days’ written notice to
the Sub-Adviser, and by the Sub-Adviser upon sixty (60) days’ written notice to
the Fund and the Manager. In the event of a termination, the Sub-Adviser shall
cooperate in the orderly transfer of the Fund’s affairs and, at the request of
the Board of Trustees or the Manager, transfer any and all books and records
of
the Fund maintained by the Sub-Adviser on behalf of the Fund; and
(c) This
Agreement shall terminate automatically in the event of any transfer or
assignment thereof, as defined in the 1940 Act. This Agreement will also
terminate in the event that the Management Agreement is terminated.
(d) The
indemnification provisions of section 6 of this Agreement shall survive
termination of the Agreement.
| 8. |
SERVICES
NOT EXCLUSIVE.
|
The
services of the Sub-Adviser to the Manager and the Fund are not to be deemed
exclusive and it shall be free to render similar services to others so long
as
its services hereunder are not impaired thereby. It is specifically understood
that directors, officers and employees of the Sub-Adviser and of its
subsidiaries and affiliates may continue to engage in providing portfolio
management services and advice to other investment advisory
clients.
| 9. |
AGGREGATION
OF ORDERS.
|
Nothing
in this Agreement, shall preclude the combination of orders for the sale or
purchase of portfolio securities of the Fund with those for other accounts
managed by the Sub-Adviser or its affiliates, if orders are allocated in a
manner deemed equitable by the Sub-Adviser among the accounts and at a price
approximately averaged. The Sub-Adviser agrees that (i) it will not aggregate
transactions unless aggregation is consistent with its duty to seek best
execution; (ii) no account will be favored over any other account; each account
participating in an aggregated order will participate at the average share
price
for all transactions in that security or a given business day, with transaction
costs shared pro-rata based on each account’s participation in the transaction;
and (iii) it will prepare, before entering an aggregated order, a written
statement (the “Allocation
Statement”)
specifying the participating accounts and how it intends to allocate the order
among those accounts or follow a standing written allocation procedure.
Notwithstanding the foregoing, the order may be allocated on a basis different
from that specified in the Allocation Statement if all accounts receive fair
and
equitable treatment and the different allocation is explained in writing and
is
approved in writing by the Sub-Adviser’s compliance officer no later than one
hour after the opening of the markets on the trading day following the day
the
order was executed.
| 10. |
NO
SHORTING; NO BORROWING.
|
The
Sub-Adviser agrees that neither it nor any of its officers or employees shall
take any short position in the shares of the Fund. This prohibition shall not
prevent the purchase of such shares by any of the officers or employees of
the
Sub-Adviser or any trust, pension, profit-sharing or other benefit plan for
such
persons or affiliates thereof, at a price not less than the net asset value
thereof at the time of purchase, as allowed pursuant to rules promulgated under
the 1940 Act. The Manager agrees that neither it nor any of its officers or
employees shall borrow from the Fund or pledge or use the Fund's assets in
connection with any borrowing not directly for the Fund's benefit. For this
purpose, failure to pay any amount due and payable to the Fund for a period
of
more than thirty (30) days shall constitute a borrowing.
| 11. |
AMENDMENT.
|
No
provision of this Agreement may be changed, waived, discharged or terminated
orally, but only by an instrument in writing signed by all parties and
shareholder approval if required under the 1940 Act.
| 12. |
NONPUBLIC
PERSONAL INFORMATION.
|
Notwithstanding
any provision herein to the contrary, the Sub-Adviser hereto agrees on behalf
of
itself and its directors, trustees, shareholders, officers, and employees (1)
to
treat confidentially and as proprietary information of the Fund (a) all records
and other information relative to the Fund’s prior, present, or potential
shareholders (and clients of said shareholders) and (b) any Nonpublic Personal
Information, as defined under Section 248.3(t) of Regulation S-P (“Regulation
S-P”),
promulgated under the Xxxxx-Xxxxx-Xxxxxx Act (the “G-L-B
Act”),
and
(2) except after prior notification to and approval in writing by the Trust,
not
to use such records and information for any purpose other than the performance
of its responsibilities and duties hereunder, or as otherwise permitted by
Regulation S-P or the G-L-B Act, and if in compliance therewith, the privacy
policies adopted by the Trust and communicated in writing to the Sub-Adviser.
Such written approval shall not be unreasonably withheld by the Trust and may
not be withheld where the Sub-Adviser may be exposed to civil or criminal
contempt or other proceedings for failure to comply after being requested to
divulge such information by duly constituted authorities.
| 13. |
ANTI-MONEY
LAUNDERING COMPLIANCE.
|
The
Sub-Adviser acknowledges that, in compliance with the Bank Secrecy Act, as
amended, the USA PATRIOT Act, and any implementing regulations thereunder
(together, “AML
Laws”),
the
Trust has adopted an Anti-Money Laundering Policy. The Sub-Adviser agrees to
comply with the Trust’s Anti-Money Laundering Policy and the AML Laws, as the
same may apply to the Sub-Adviser, now and in the future. The Sub-Adviser
further agrees to provide to the Trust and/or the Fund’s administrator such
reports, certifications and contractual assurances as may be reasonably
requested by the Trust. The Trust may disclose information regarding the
Sub-Adviser to governmental and/or regulatory or self-regulatory authorities
to
the extent required by applicable law or regulation and may file reports with
such authorities as may be required by applicable law or
regulation.
| 14. |
CERTIFICATIONS;
DISCLOSURE CONTROLS AND PROCEDURES.
|
The
Sub-Adviser acknowledges that, in compliance with the Xxxxxxxx-Xxxxx Act of
2002
(the “Xxxxxxxx-Xxxxx
Act”),
and
the implementing regulations promulgated thereunder, the Trust and the Fund
are
required to make certain certifications and have adopted disclosure controls
and
procedures. To the extent reasonably requested by the Trust, the Sub-Adviser
agrees to use its best efforts to assist the Trust and the Fund in complying
with the Xxxxxxxx-Xxxxx Act and implementing the Trust’s disclosure controls and
procedures. The Sub-Adviser agrees to inform the Trust of any material
development related to the Fund that the Sub-Adviser reasonably believes is
relevant to the Fund’s certification obligations under the Xxxxxxxx-Xxxxx
Act.
| 15. |
NOTIFICATION
|
The
Sub-Advisor agrees that it will provide immediate notice to the Manager and
Fund
about any changes in the employment status of all investment management
personnel involved in the management of the Fund, material changes in the
investment process used to manage the Fund and any changes in senior management,
operations material to the Fund or ownership of the Sub-Advisor.
| 16. |
NOTICES.
|
Notices
and other communications required or permitted under this Agreement shall be
in
writing, shall be deemed to be effectively delivered when actually received,
and
may be delivered by US mail (first class, postage prepaid), by facsimile
transmission, by hand or by commercial overnight delivery service, addressed
as
follows:
|
MANAGER:
|
Sincere
Investment Management, LLC
X.X.
Xxx 0000
Xxxxxxxxx,
XX 00000
Attn:
Xxxxxxx Sincere
|
|
SUB-ADVISER:
|
Xxxxx
Investment Research, Inc.
0000
Xxxxxxxxxxx Xxxx
Xxxxx,
XX 00000
Attn:
Xxxxxx Xxxxxx
|
|
FUND:
|
On
behalf of Sincere Advisor Small Cap Fund
000
Xxxx Xxxxxxxx Xxxxxx
Xxxxxxxxx,
XX 00000
Attn:
Secretary
|
| 17. |
SEVERABILITY.
|
If
any
provision of this Agreement shall be held or made invalid by a court decision,
statute or rule, or shall be otherwise rendered invalid, the remainder of this
Agreement shall not be affected thereby.
| 18. |
CAPTIONS.
|
The
caption in this Agreement are not 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.
| 19. |
GOVERNING
LAW.
|
This
agreement shall be governed by, and construed in accordance with, the laws
of
the state of Delaware without giving effect to the conflict of laws principles
of Delaware or any other jurisdiction; provided that nothing herein shall be
construed to preempt, or to be inconsistent with, any federal law, regulation
or
rule, including the 1940 Act and the Investment Advisers Act of 1940, as
amended, and any rules and regulations promulgated thereunder.
[SIGNATURE
PAGE FOLLOWS]
IN
WITNESS WHEREOF,
the
parties hereto have caused this Agreement to be executed as of the day first
set
forth above.
|
SINCERE
INVESTMENT MANAGEMENT, LLC
By: /s/
Xxxxxxx
Sincere
Name:
Xxxxxxx Sincere
Title:
President
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XXXXX
INVESTMENT RESEARCH, INC.
By: /s/ [illegible]
Xxxxx
Name:
Title:
Chairman
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On
behalf of Sincere Advisor Small Cap Fund
By: /s/ Xxxxxxx
X.
Xxxx
Name:
Xxxxxxx X. Xxxx
Title: Treasurer
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EXHIBIT
A
INVESTMENT
GUIDELINES
Investment
Objective and Policies
The
goal
of the Fund is to provide long-term capital appreciation by investing primarily
in equity securities.
The
Fund
emphasizes the purchase of equity securities of small capitalization companies,
defined as those companies with market capitalizations of $1.5 billion or less
at the time of purchase. This capitalization range and other non-fundamental
policies may be changed from time to time, as disclosed in the Fund’s then
current registration statement. Under normal market conditions, at least 80%
of
the Fund’s net assets (plus any borrowings for investment purposes, if any) will
be invested in equity securities of companies believed to have these
characteristics. Equity securities may include, but are not limited to, common
stocks, convertible securities and American Depository Receipts (“ADRs”). In
addition, the Fund may invest up to 10% of its assets in foreign issuers through
the use of depository receipts such as ADRs.
At
the
discretion of the Sub-Adviser, the Fund may invest up to 100% of its assets
in
cash, cash equivalents, and high-quality, short-term debt securities and money
market instruments for temporary defensive purposes.
Investment
Restrictions
As
a
matter of fundamental policy, the Fund is diversified. The Fund’s investment
objectives are also fundamental.
In
addition, the Fund may not:
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1.
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Issue
senior securities, borrow money or pledge its assets, except that
(i) the Fund may borrow from banks in amounts not exceeding one-third
of its total assets (including the amount borrowed); and (ii) this
restriction shall not prohibit the Fund from engaging in options
transactions or short sales;
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2.
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Act
as underwriter (except to the extent the Fund may be deemed to be
an
underwriter in connection with the sale of securities in its investment
portfolio);
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3.
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Invest
more than 25% of its net assets, calculated at the time of purchase
and
taken at market value, in securities of issuers in any one industry
(other
than U.S. Government securities);
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4.
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Purchase
or sell real estate unless acquired as a result of ownership of securities
(although the Fund may purchase and sell securities which are secured
by
real estate and securities of companies which invest or deal in real
estate);
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5.
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Purchase
or sell physical commodities, unless acquired as a result of ownership
of
securities or other instruments and provided that this restriction
does
not prevent the Fund from engaging in transactions involving currencies
and futures contracts and options thereon or investing in securities
or
other instruments that are secured by physical commodities;
or
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6.
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Make
loans of money (except for through the lending of its portfolio
securities, purchases of debt securities consistent with the investment
policies of the Fund and except for repurchase
agreements).
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The
Fund
observes the following restrictions as a matter of operating but not fundamental
policy. Except as noted below, the Fund may not:
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1.
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Purchase
securities on margin, except such short-term credits as may be necessary
for the clearance of transactions and except that the Fund may borrow
money from banks to purchase
securities;
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2.
Make
investments for the purpose of exercising control or management; or
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3.
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Make
any change in its investment policies of investing at least 80% of
its net
assets under normal circumstances in the investments suggested by
the
Fund’s name without first providing the Fund’s shareholders with at least
60 days’ prior notice.
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SCHEDULE
B
FEES
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Series
of Advisors Series Trust
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Annual
Fee Rate
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Sincere
Advisor Small Cap Fund
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0.50%
of average current net assets of the Fund
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