SUB-ADVISORY AGREEMENT
SUB-ADVISORY AGREEMENT (the "Agreement") made as of this 27th day of
December, 2011 by and between WESTWOOD MANAGEMENT CORP. a New York Corporation
with its principal place of business at 000 Xxxxxxxx Xxxxx, Xxxxx 0000, Xxxxxx,
Xxxxx 00000 (the "Adviser"), and SKY HARBOR CAPITAL MANAGEMENT, LLC a Delaware
limited liability company with its principal place of business at 00 Xxxxxxxxx
Xxxx, Xxxxxxxxx, XX 00000 (the "Sub-Adviser").
W I T N E S S E T H
WHEREAS, pursuant to authority granted to the Adviser by the Board of
Trustees (the "Board") of THE ADVISORS' INNER CIRCLE FUND (the "Trust") on
behalf of the series set forth on Schedule A to this Agreement (the "Fund") and
pursuant to the provisions of the Investment Advisory Agreement dated as of
December 16, 2005 between the Adviser and the Fund (the "Management
Agreement"), the Adviser has selected the Sub-Adviser to act as sub-investment
adviser of the Fund and to provide certain related services, as more fully set
forth below, and to perform such services under the terms and conditions
hereinafter set forth;
NOW, THEREFORE, in consideration of the mutual covenants and benefits
set forth herein, the Adviser and the Sub-Adviser do hereby agree as follows:
1. THE SUB-ADVISER'S SERVICES.
(a) DISCRETIONARY INVESTMENT MANAGEMENT SERVICES. The Sub-Adviser
shall act as sub-investment adviser with respect to the Fund. In such
capacity, the Sub-Adviser shall, subject to the supervision of the Adviser
and the Board, regularly provide the Fund with investment research, advice
and supervision and shall furnish continuously an investment program for
such Fund assets as may be allocated by the Adviser to the Sub-Adviser,
consistent with the investment objectives and policies of the Fund. The
Sub-Adviser shall determine, from time to time, what investments shall be
purchased for the Fund and what such securities shall be held or sold by
the Fund, subject always to the provisions of the Trust's Agreement and
Declaration of Trust, By-Laws and its registration statement on Form N-1A
(the "Registration Statement") under the Investment Company Act of 1940, as
amended (the "1940 Act"), and under the Securities Act of 1933, as amended
(the "1933 Act"), covering Fund shares, as filed with the Securities and
Exchange Commission (the "Commission"), and to the investment objectives,
policies and restrictions of the Fund, as each of the same shall be from
time to time in effect. To carry out such obligations, the Sub-Adviser
shall exercise full discretion and act for the Fund in the same manner and
with the same force and effect as the Fund itself might or could do with
respect to purchases, sales or other transactions, as well as with respect
to all other such things necessary or incidental to the furtherance or
conduct of such purchases, sales or other transactions. Notwithstanding the
foregoing, the Sub-Adviser shall, upon written instructions from the
Adviser, effect such portfolio transactions for the Fund as the Adviser may
from time to time direct; provided however, that the Sub-Adviser shall not
be responsible for any such portfolio transactions effected
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upon written instructions from the Adviser. No reference in this Agreement
to the Sub-Adviser having full discretionary authority over the Fund's
investments shall in any way limit the right of the Adviser, in its sole
discretion, to establish or revise policies in connection with the
management of the Fund's assets or to otherwise exercise its right to
control the overall management of the Fund's assets.
(b) COMPLIANCE. The Sub-Adviser agrees to comply with the requirements
of the 1940 Act, the Investment Advisers Act of 1940, as amended (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 and to the
conduct of its business as a registered investment adviser. The Sub-Adviser
also agrees to comply with the objectives, policies and restrictions set
forth in the Registration Statement, as amended or supplemented, of the
Fund, and with any policies, guidelines, instructions and procedures
approved by the Board or the Adviser and provided to the Sub-Adviser. In
selecting the Fund's portfolio securities and performing the Sub-Adviser's
obligations hereunder, the Sub-Adviser shall cause the Fund 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-Adviser shall
maintain compliance procedures that it reasonably believes are adequate to
ensure the compliance with the foregoing. No supervisory activity
undertaken by the Adviser shall limit the Sub-Adviser's full responsibility
for any of the foregoing.
(c) PROXY VOTING. Pursuant to Board authority, the Adviser has the
authority to determine how proxies with respect to securities that are held
by the Fund shall be voted, and the Adviser may delegate the authority and
responsibility to vote proxies for the Fund's securities to the
Sub-Adviser. So long as proxy voting authority for the Fund has been
delegated to the Sub-Adviser, the Adviser shall provide such assistance to
the Sub-Adviser with respect to the voting of proxies for the Fund as the
Sub-Adviser may from time to time reasonably request, and the Adviser shall
promptly forward to the Sub-Adviser any information or documents necessary
for the Sub-Adviser to exercise its proxy voting responsibilities. The
Sub-Adviser shall carry out such responsibility in accordance with any
instructions that the Board or the Adviser shall provide from time to time,
and at all times in a manner consistent with Rule 206(4)-6 under the
Advisers Act and its fiduciary responsibilities to the Trust. The
Sub-Adviser shall provide periodic reports and keep such records relating
to proxy voting as the Board may reasonably request or as may be necessary
for the Fund to comply with the 1940 Act and other applicable law. Any such
delegation of proxy voting responsibility to the Sub-Adviser may be revoked
or modified by the Board or the Adviser at any time.
The Sub-Adviser is authorized to instruct the Fund's custodian and/or
broker(s) to forward promptly to the Sub-Adviser or designated service
provider copies of all proxies and shareholder communications relating to
securities held in the portfolio of a Fund (other than materials relating
to legal proceedings against the Fund). The Sub-Adviser
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may also instruct the Fund's custodian and/or broker(s) to provide reports
of holdings in the portfolio of the Fund. The Sub-Adviser has the authority
to engage a service provider to assist with administrative functions
related to voting Fund proxies. The Trust shall direct the Fund's custodian
and/or broker(s) to provide any assistance requested by the Sub-Adviser in
facilitating the use of a service provider. In no event shall the
Sub-Adviser have any responsibility to vote proxies that are not received
on a timely basis. The Trust acknowledges that the Sub-Adviser, consistent
with the Sub-Adviser's written proxy voting policies and procedures, may
refrain from voting a proxy if, in the Sub-Adviser's discretion, refraining
from voting would be in the best interests of the Fund and its
shareholders.
(d) RECORDKEEPING. The Sub-Adviser shall not be responsible for the
provision of administrative, bookkeeping or accounting services to the
Fund, except as otherwise provided herein or as may be necessary for the
Sub-Adviser to supply to the Adviser, the Trust or its Board the
information required to be supplied under this Agreement.
The Sub-Adviser shall maintain separate books and detailed records of
all matters pertaining to the Fund's assets advised by the Sub-Adviser
required by Rule 31a-1 under the 1940 Act (other than those records being
maintained by the Adviser, or any administrator 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 Adviser and the Board at any time upon request shall be delivered to
the Trust upon the termination of this Agreement and shall be available
without delay during any day the Trust is open for business.
(e) HOLDINGS INFORMATION AND PRICING. The Sub-Adviser shall provide
regular reports regarding the Fund's holdings, and may, on its own
initiative, furnish the Adviser, the Trust and its Board from time to time
with whatever information the Sub-Adviser believes is appropriate for this
purpose. The Sub-Adviser agrees to notify the Adviser and the Board
promptly if the Sub-Adviser reasonably believes that the value of any
security held by a Fund may not reflect fair value. The Sub-Adviser agrees
to provide upon request any pricing information of which the Sub-Adviser is
aware to the Adviser, Trust, its Board and/or any Fund pricing agent to
assist in the determination of the fair value of any Fund holdings for
which market quotations are not readily available or as otherwise required
in accordance with the 1940 Act or the Fund valuation procedures for the
purpose of calculating the Trust's net asset value in accordance with
procedures and methods established by the Board.
(f) COOPERATION WITH AGENTS OF THE ADVISER AND THE TRUST. The
Sub-Adviser agrees to cooperate with and provide reasonable assistance to
the Adviser, the Trust and any Trust custodian or foreign sub-custodians,
any Trust pricing agents and all other agents and representatives of the
Adviser and the Trust with respect to such information regarding the Fund
as such entities may reasonably request from time to time in the
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performance of their obligations, provide prompt responses to reasonable
requests made by such persons and establish appropriate interfaces with
each so as to promote the efficient exchange of information and compliance
with applicable laws and regulations.
(g) CONSULTATION WITH OTHER SUB-ADVISERS. In performance of its duties
and obligations under this Agreement, the Sub-Adviser shall not consult
with any other sub-adviser to the Fund or a sub-adviser to a portfolio that
is under common control with the Fund concerning transactions for the Fund,
except as permitted by the policies and procedures of the Fund. The
Sub-Adviser shall not provide investment advice to any assets of the Fund
other than the assets managed by the Sub-Adviser.
2. CODE OF ETHICS. The Sub-Adviser 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 has provided to the Adviser and the Trust. The
Sub-Adviser shall ensure that its Access Persons (as defined in the
Sub-Adviser's Code of Ethics) comply in all material respects with the
Sub-Adviser's Code of Ethics, as in effect from time to time. Upon request, the
Sub-Adviser shall provide the Trust with (i) a copy of the Sub-Adviser's
current Code of Ethics, as in effect from time to time, and (ii) a
certification that it has adopted procedures reasonably necessary to prevent
Access Persons from engaging in any conduct prohibited by the Sub-Adviser's
Code of Ethics. Annually, the Sub-Adviser shall furnish a written report, which
complies with the requirements of Rule 17j-1, concerning the Sub-Adviser's Code
of Ethics to the Adviser and the Trust's Board. The Sub-Adviser shall respond
to requests for information from the Adviser and the Trust as to violations of
the Code by Access Persons and the sanctions imposed by the Sub-Adviser. The
Sub-Adviser shall immediately notify the Adviser and the Trust of any material
violation of the Code, whether or not such violation relates to a security held
by any Fund.
3. INFORMATION AND REPORTING. The Sub-Adviser shall provide the
Adviser, the Trust, and their respective officers with such periodic reports
concerning the obligations the Sub-Adviser has assumed under this Agreement as
the Adviser and the Trust may from time to time reasonably request.
(a) NOTIFICATION OF BREACH / COMPLIANCE REPORTS. The Sub-Adviser shall
notify the Trust's Chief Compliance Officer and Adviser immediately upon
detection of (i) any material failure to manage any 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. In addition, the Sub-Adviser shall provide a quarterly
report regarding the Fund's compliance with its investment objectives and
policies, applicable law, including, but not limited to the 1940 Act and
Subchapter M of the Code, and the Fund's and the Adviser's policies,
guidelines or procedures as applicable to the Sub-Adviser's obligations
under this Agreement. The Sub-Adviser acknowledges and agrees that the
Adviser may, in its discretion, provide such quarterly compliance
certifications to the Board. The Sub-Adviser agrees to correct any such
failure promptly and to take any action that the Board and/or the Adviser
may reasonably request in connection with any such breach. Upon request,
the Sub-Adviser shall also provide the officers of the Trust with
supporting certifications in connection with such certifications of Fund
financial statements and disclosure controls pursuant to the
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Xxxxxxxx-Xxxxx Act. The Sub-Adviser will promptly notify the Trust in the
event (i) the Sub-Adviser 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-Adviser with the federal or state
securities laws or (ii) an actual change in control of the Sub-Adviser
resulting in an "assignment" (as defined in the 1940 Act) has occurred or
is otherwise proposed to occur.
(b) INSPECTION. Upon reasonable request, the Sub-Adviser agrees to
make its records and premises (including the availability of the
Sub-Adviser's employees for interviews) to the extent that they relate to
the conduct of services provided to the Fund or the Sub-Adviser's conduct
of its business as an investment adviser reasonably available for
compliance audits by the Adviser or the Trust's officers, employees,
accountants or counsel; in this regard, the Trust and the Adviser
acknowledge that the Sub-Adviser shall have no obligation to make available
proprietary information unrelated to the services provided to the Fund or
any information related to other clients of the Sub-Adviser, except to the
extent necessary for the Adviser to confirm the absence of any conflict of
interest and compliance with any laws, rules or regulations in the
management of the Fund.
(c) BOARD AND FILINGS INFORMATION. The Sub-Adviser will also provide
the Adviser and Trust with any information reasonably requested regarding
its management of the Fund required for any meeting of the Board, or for
any shareholder report, Form N-CSR, Form N-Q, Form N-PX, Form N-SAR,
amended registration statement, proxy statement, or prospectus supplement
to be filed by the Trust with the Commission. The Sub-Adviser will make its
officers and employees available to meet with the Board from time to time
on due notice to review its investment management services to the Fund in
light of current and prospective economic and market conditions and shall
furnish to the Board such information as may reasonably be necessary in
order for the Board to evaluate this Agreement or any proposed amendments
thereto.
(d) TRANSACTION INFORMATION. The Sub-Adviser shall furnish to the
Adviser and the Trust such information concerning portfolio transactions as
may be necessary to enable the Adviser, Trust or their designated agents to
perform such compliance testing on the Fund and the Sub-Adviser's services
as the Adviser and the Trust may, in their sole discretion, determine to be
appropriate. The provision of such information by the Sub-Adviser to the
Adviser, Trust or their designated agents in no way relieves the
Sub-Adviser of its own responsibilities under this Agreement.
4. BROKERAGE.
(a) PRINCIPAL TRANSACTIONS. In connection with purchases or sales of
securities for the account of a Fund, neither the Sub-Adviser nor any of
its directors, officers or employees will act as a principal or agent or
receive any commission except as permitted by the 1940 Act.
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(b) PLACEMENT OF ORDERS. The Sub-Adviser shall arrange for the placing
of all orders for the purchase and sale of securities for a Fund's account
with brokers or dealers selected by the Sub-Adviser. In the selection of
such brokers or dealers and the placing of such orders, the Sub-Adviser is
directed at all times to seek for a Fund the most favorable execution and
net price available under the circumstances. It is also understood that it
is desirable for the Fund that the Sub-Adviser have access to brokerage and
research services provided by brokers who may execute brokerage
transactions at a higher cost to the Fund than may result when allocating
brokerage to other brokers, consistent with section 28(e) of the 1934 Act
and any Commission staff interpretations thereof. Therefore, the
Sub-Adviser is authorized to place orders for the purchase and sale of
securities for the Fund with such brokers, subject to review by the Adviser
and the Board from time to time with respect to the extent and continuation
of this practice. It is understood that the services provided by such
brokers may be useful to the Sub-Adviser in connection with its or its
affiliates' services to other clients.
(c) AGGREGATED TRANSACTIONS. On occasions when the Sub-Adviser deems
the purchase or sale of a security to be in the best interest of a Fund as
well as other clients of the Sub-Adviser, the Sub-Adviser may, to the
extent permitted by applicable law and regulations, aggregate the order for
securities to be sold or purchased. In such event, the Sub-Adviser will
allocate securities or futures contracts so purchased or sold, as well as
the expenses incurred in the transaction, in the manner the Sub-Adviser
reasonably considers to be equitable and consistent with its fiduciary
obligations to a Fund and to such other clients under the circumstances.
(d) AFFILIATED BROKERS. The Sub-Adviser or any of its affiliates may
act as broker in connection with the purchase or sale of securities or
other investments for a Fund, subject to: (a) the requirement that the
Sub-Adviser seek to obtain best execution and price within the policy
guidelines determined by the Board and set forth in a Fund's current
Registration Statement; (b) the provisions of the 1940 Act; (c) the
provisions of the Advisers Act; (d) the provisions of the 1934 Act; and (e)
other provisions of applicable law. These brokerage services are not within
the scope of the duties of the Sub-Adviser under this Agreement. Subject to
the requirements of applicable law and any procedures adopted by the Board,
the Sub-Adviser or its affiliates may receive brokerage commissions, fees
or other remuneration from a Fund for these services in addition to the
Sub-Adviser's fees for services under this Agreement.
5. CUSTODY. Nothing in this Agreement shall permit the Sub-Adviser to
take or receive physical possession of cash, securities or other investments of
a Fund.
6. ALLOCATION OF CHARGES AND EXPENSES. The Sub-Adviser will bear its
own costs of providing services hereunder. Other than as herein specifically
indicated, the Sub-Adviser shall not be responsible for a Fund's or the
Adviser's expenses, including brokerage and other expenses incurred in placing
orders for the purchase and sale of securities and other investment
instruments.
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7. REPRESENTATIONS, WARRANTIES AND COVENANTS.
(a) PROPERLY REGISTERED. The Sub-Adviser is registered as an
investment adviser under the Advisers Act, and will remain so registered
for the duration of this Agreement. The Sub-Adviser is not prohibited by
the Advisers Act or the 1940 Act from performing the services contemplated
by this Agreement, and to the best knowledge of the Sub-Adviser, there is
no proceeding or investigation that is reasonably likely to result in the
Sub-Adviser being prohibited from performing the services contemplated by
this Agreement. The Sub-Adviser agrees to promptly notify the Trust of the
occurrence of any event that would disqualify the Sub-Adviser from serving
as an investment adviser to an investment company. The Sub-Adviser is in
compliance in all material respects with all applicable federal and state
law in connection with its investment management operations.
(b) ADV DISCLOSURE. The Sub-Adviser has provided the Trust with a copy
of Part I of its Form ADV as most recently filed with the Commission and
its Part II as most recently updated and will, promptly after filing any
amendment to its Form ADV with the Commission or updating its Part II,
furnish a copy of such amendments or updates to the Trust. The information
contained in the Adviser's Form ADV is accurate and complete in all
material respects and does not omit to state any material fact necessary in
order to make the statements made, in light of the circumstances under
which they were made, not misleading.
(c) FUND DISCLOSURE DOCUMENTS. The Sub-Adviser has reviewed and will
in the future review, the Registration Statement, summary prospectus,
prospectus, statement of additional information, periodic reports to
shareholders, reports and schedules filed with the Commission (including
any amendment, supplement or sticker to any of the foregoing) and
advertising and sales material relating to the Fund (collectively the
"Disclosure Documents") and represents and warrants that such Disclosure
Documents contain or will contain no untrue statement of any material fact
and do not and will not omit any statement of material fact required to be
stated therein or necessary to make the statements therein not misleading.
(d) USE OF THE NAME "WESTWOOD" OR THE ACRONYM "WHG." The Sub-Adviser
has the right to use the name "Westwood" or the acronym "WHG" in connection
with its services to the Trust. The Sub-Adviser is not aware of any
threatened or existing actions, claims, litigation or proceedings that
would adversely affect or prejudice the rights of the Sub-Adviser or the
Trust to use the name "Westwood" or the acronym "WHG."
(e) INSURANCE. The Sub-Adviser maintains errors and omissions
insurance coverage in an appropriate amount and shall provide prior written
notice to the Trust (i) of any material changes in its insurance policies
or insurance coverage; or (ii) if any material claims will be made on its
insurance policies. Furthermore, the Sub-Adviser shall, upon reasonable
request, provide the Trust with any information it may reasonably require
concerning the amount of or scope of such insurance.
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(f) NO DETRIMENTAL AGREEMENT. The Sub-Adviser represents and warrants
that it has no arrangement or understanding with any party, other than the
Trust, that would influence the decision of the Sub-Adviser with respect to
its selection of securities for a Fund, and that all selections shall be
done in accordance with what is in the best interest of the Fund.
(g) CONFLICTS. The Sub-Adviser shall act honestly, in good faith and
in the best interests of the Trust including requiring any of its personnel
with knowledge of Fund activities to place the interest of the Fund first,
ahead of their own interests, in all personal trading scenarios that may
involve a conflict of interest with the Fund, consistent with its fiduciary
duties under applicable law.
(h) REPRESENTATIONS. The representations and warranties in this
Section 7 shall be deemed to be made on the date this Agreement is executed
and at the time of delivery of the quarterly compliance report required by
Section 3(a), whether or not specifically referenced in such report.
8. THE NAME "WESTWOOD" OR THE ACRONYM "WHG." The Adviser has granted
to the Trust a license to use the name "Westwood" or the acronym "WHG"
(collectively, the "Name") as part of the name of the Fund. The foregoing
authorization by the Adviser to the Trust to use the Name as part of the name
of the Fund is not exclusive of the right of the Adviser itself to use, or to
authorize others to use, the Name; the Sub-Adviser acknowledges and agrees that
as between the Sub-Adviser and the Adviser, the Adviser has the right to use,
or authorize others to use, the Name and the Sub-Adviser agrees to take such
action as may reasonably be requested by the Adviser to give full effect to the
provisions of this section. Without limiting the generality of the foregoing,
the Sub-Adviser agrees that, upon any termination of this Agreement, the
Sub-Adviser will not thereafter transact any business using the name "Westwood"
or the acronym "WHG."
9. SUB-ADVISER'S COMPENSATION. The Adviser shall pay to the
Sub-Adviser, as compensation for the Sub-Adviser's services hereunder, a fee,
determined as described in Schedule A that is attached hereto and made a part
hereof. Such fee shall be computed daily and paid not less than monthly in
arrears by the Adviser. The Fund shall have no responsibility for any fee
payable to the Sub-Adviser.
The Sub-Adviser will be compensated based on the portion of Fund
assets allocated to the Sub-Adviser by the Adviser. The method for determining
net assets of the Fund for purposes hereof shall be the same as the method for
determining net assets for purposes of establishing the offering and redemption
prices of Fund shares as described in the Fund's prospectus. In the event of
termination of this Agreement, the fee provided in this Section shall be
computed on the basis of the period ending on the last business day on which
this Agreement is in effect subject to a pro rata adjustment based on the
number of days elapsed in the current month as a percentage of the total number
of days in such month.
10. INDEPENDENT CONTRACTOR. In the performance of its duties
hereunder, the Sub-Adviser is and shall be an independent contractor and,
unless otherwise expressly provided herein or otherwise authorized in writing,
shall have no authority to act for or represent the Fund,
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the Trust or the Adviser in any way or otherwise be deemed to be an agent of
the Fund, the Trust or the Adviser. If any occasion should arise in which the
Sub-Adviser gives any advice to its clients concerning the shares of a Fund,
the Sub-Adviser will act solely as investment counsel for such clients and not
in any way on behalf of the Fund.
11. ASSIGNMENT AND AMENDMENTS. This Agreement shall automatically
terminate, without the payment of any penalty, (i) in the event of its
assignment (as defined in section 2(a)(4) of the 0000 Xxx) or (ii) in the event
of the termination of the Management Agreement; provided that such termination
shall not relieve the Adviser or the Sub-Adviser of any liability incurred
hereunder.
This Agreement may not be added to or changed orally and may not be
modified or rescinded except by a writing signed by the parties hereto and in
accordance with the 1940 Act, when applicable.
12. DURATION AND TERMINATION.
This Agreement shall become effective as of the date executed and shall remain
in full force and effect continually thereafter, subject to renewal as provided
in Section 12(c) and unless terminated automatically as set forth in Section 11
hereof or until terminated as follows:
(a) The Trust may cause this Agreement to terminate either (i) by vote
of its Board or (ii) with respect to the Fund, upon the affirmative vote of
a majority of the outstanding voting securities of the Fund; or
(b) The Adviser may at any time terminate this Agreement by 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-Adviser; or
(c) The Sub-Adviser may at any time terminate this Agreement by not
more than sixty (60) days' nor less than thirty (30) days' written notice
delivered or mailed by registered mail, postage prepaid, to the Adviser; or
(d) This Agreement shall automatically terminate two years from the
date of its execution unless its renewal is specifically approved at least
annually thereafter by (i) a majority vote of the Trustees, including a
majority vote of such Trustees who are not interested persons of the Trust,
the Adviser or the Sub-Adviser, at a meeting called for the purpose of
voting on such approval; or (ii) the vote of a majority of the outstanding
voting securities of the Fund; provided, however, that 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 of this
Agreement as provided herein, the Sub-Adviser may continue to serve
hereunder as to the Fund in a manner consistent with the 1940 Act and the
rules and regulations thereunder; and
(e) Termination of this Agreement pursuant to this Section shall be
without payment of any penalty.
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In the event of termination of this Agreement for any reason, the
Sub-Adviser shall, immediately upon notice of termination or on such later
date as may be specified in such notice, cease all activity on behalf of
the Fund and with respect to any of its assets, except as expressly
directed by the Adviser or as otherwise required by any fiduciary duties of
the Sub-Adviser under applicable law. In addition, the Sub-Adviser shall
deliver the Fund's Books and Records to the Adviser by such means and in
accordance with such schedule as the Adviser shall direct and shall
otherwise cooperate, as reasonably directed by the Adviser, in the
transition of portfolio asset management to any successor of the
Sub-Adviser, including the Adviser.
13. CERTAIN DEFINITIONS. FOR THE PURPOSES OF THIS AGREEMENT:
(a) "Affirmative vote of a majority of the outstanding voting
securities of the Fund" shall have the meaning as set forth in the 1940
Act, subject, however, to such exemptions as may be granted by the
Commission under the 1940 Act or any interpretations of the Commission
staff.
(b) "Interested persons" and "Assignment" shall have their respective
meanings as set forth in the 1940 Act, subject, however, to such exemptions
as may be granted by the Commission under the 1940 Act or any
interpretations of the Commission staff.
14. LIABILITY OF THE SUB-ADVISER.
(a) The Sub-Adviser shall have responsibility for the accuracy and
completeness (and liability for the lack thereof) of statements in the
Fund's Disclosure Documents.
(b) The Sub-Adviser shall be liable to the Fund for any loss
(including transaction costs) incurred by the Fund as a result of any
investment made by the Sub-Adviser in contravention of: (i) any investment
policy, guideline or restriction set forth in the Registration Statement or
as approved by the Board from time to time and provided to the Sub-Adviser;
or (ii) applicable law, including but not limited to the 1940 Act and the
Code (including but not limited to the Fund's failure to satisfy the
diversification or source of income requirements of Subchapter M of the
Code) (the investments described in this subsection (b) collectively are
referred to as "Improper Investments").
(c) The Sub-Adviser shall indemnify and hold harmless the Trust, each
affiliated person of the Trust within the meaning of Section 2(a)(3) of the
1940 Act, and each person who controls the Trust within the meaning of
Section 15 of the 1933 Act (any such person, an "Indemnified Party")
against any and all losses, claims, damages, expenses or liabilities
(including the reasonable cost of investigating and defending any alleged
loss, claim, damage, expense or liability and reasonable counsel fees
incurred in connection therewith) to which any such person may become
subject under the 1933 Act, the 1934 Act, the 1940 Act or other federal or
state statutory law or regulation, at common law or otherwise, insofar as
such losses, claims, damages, expenses or liabilities (or actions in
respect thereof) arise out of or are based upon: (i) a breach by the Sub-
10
Adviser of this Agreement or of the representations and warranties made by
the Sub-Adviser herein; (ii) any Improper Investment; (iii) any untrue
statement or alleged untrue statement of a material fact contained in any
Disclosure Document or the omission or alleged omission from a Disclosure
Document of a material fact required to be stated therein or necessary to
make the statements therein not misleading; or (iv) the Sub-Adviser's
performance or non-performance of its duties hereunder; provided, however,
that nothing herein shall be deemed to protect any Indemnified Party who is
a Trustee or officer of the Trust against any liability to the Trust or to
its shareholders to which such Indemnified Party would otherwise be subject
by reason or willful misfeasance, bad faith, gross negligence or reckless
disregard of the duties
involved in the conduct of such person's office with the Trust.
15. ENFORCEABILITY. Any term or provision of this Agreement which is
invalid or unenforceable in any jurisdiction shall, as to such jurisdiction be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms or provisions of this
Agreement or affecting the validity or enforceability of any of the terms or
provisions of this Agreement in any other jurisdiction.
16. LIMITATION OF LIABILITY. The parties to this Agreement
acknowledge and agree that all litigation arising hereunder, whether direct or
indirect, and of any and every nature whatsoever shall be satisfied solely out
of the assets of the affected Fund and that no Trustee, officer or holder of
shares of beneficial interest of the Fund shall be personally liable for any of
the foregoing liabilities. The Trust's Certificate of Trust, as amended from
time to time, is on file in the Office of the Secretary of State of the
Commonwealth of Massachusetts. Such Certificate of Trust and the Trust's
Agreement and Declaration of Trust describe in detail the respective
responsibilities and limitations on liability of the Trustees, officers, and
holders of shares of beneficial interest.
17. CHANGE IN THE ADVISER'S OWNERSHIP. The Sub-Adviser agrees that it
shall notify the Trust of any anticipated or otherwise reasonably foreseeable
change in the ownership of the Sub-Adviser within a reasonable time prior to
such change being effected.
18. JURISDICTION. This Agreement shall be governed by and construed
in accordance with the substantive laws of the Commonwealth of Massachusetts
and the Sub-Adviser consents to the jurisdiction of courts, both state or
federal, in Massachusetts, with respect to any dispute under this Agreement.
19. PARAGRAPH HEADINGS. The headings of paragraphs contained in this
Agreement are provided for convenience only, form no part of this Agreement and
shall not affect its construction.
20. 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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IN WITNESS WHEREOF, the parties hereto have caused this instrument to be signed
on their behalf by their duly authorized officers as of the date first above
written.
WESTWOOD MANAGEMENT CORP.
By: /s/ Xxxxx X. Xxxxx
------------------------------
Name: Xxxxx X. Xxxxx
Title: President & CEO
SKY HARBOR CAPITAL MANAGEMENT, LLC
By: /s/ Xxxxxx X. Xxxxxxxx
-------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Director
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SCHEDULE A
TO THE
SUB-ADVISORY AGREEMENT
DATED DECEMBER 27, 2011 BETWEEN
WESTWOOD MANAGEMENT CORP.
AND
SKY HARBOR CAPITAL MANAGEMENT, LLC
The Adviser will pay to the Sub-Adviser as compensation for the Sub-Adviser's
services rendered, a fee, computed daily at an annual rate based on the average
daily net assets of the respective Fund as may be allocated by the Adviser to
the Sub-Adviser from time to time under the following fee schedule:
FUND RATE
---- ----
WHG Short Duration High Yield Fund 0.35%
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