INVESTMENT SUB-ADVISORY AGREEMENT
AMONG XXXXX FARGO FUNDS TRUST,
XXXXX FARGO FUNDS MANAGEMENT, LLC, THE ROCK CREEK
GROUP, LP AND XXXXXXXXX GLOBAL ASSET MANAGEMENT LLC
This AGREEMENT is made as of this 25th day of May
2016, by and among Xxxxx Fargo Funds Trust (the "Trust"), a
statutory trust organized under the laws of the State of Delaware
with its principal place of business at 000 Xxxxxx Xxxxxx, 00xx
Xxxxx, Xxx Xxxxxxxxx, Xxxxxxxxxx 00000, Xxxxx Fargo Funds
Management, LLC (the "Investment Manager"), a limited liability
company organized under the laws of the State of Delaware with
its principal place of business at 000 Xxxxxx Xxxxxx, 00xx Xxxxx, Xxx
Xxxxxxxxx, Xxxxxxxxxx 00000, The Rock Creek Group, LP, a limited
partnership organized under the laws of the State of Delaware,
with its principal place of business at 0000 Xxxxxxxxxxx Xxxxxx,
X.X., Xxxxx 000, Xxxxxxxxxx, X.X. 00000 (the "Sub-Adviser") and
Xxxxxxxxx Global Asset Management LLC, a limited liability
company organized under the laws of the State of Delaware with a
principal place of business at 00 Xxxxxx Xxxxxx, Xxx Xxxxxxxxx,
Xxxxxxxxxxx 00000 (the "Manager").
WHEREAS, the Investment Manager, the Sub-Adviser
and the Manager are each registered investment advisers under the
U.S. Investment Advisers Act of 1940 (the "Advisers Act"); and
WHEREAS, the Trust is registered under the U.S.
Investment Company Act of 1940 (the "1940 Act"), as an openend,
series management investment company; and
WHEREAS, the Trust's Board of Trustees (the "Board")
has engaged the Investment Manager to perform investment
advisory and fund-level administration services for each series of
the Trust under the terms of an investment management agreement,
dated July 1, 2015 and as amended and supplemented from time to
time, between the Investment Manager and the Trust (the
"Investment Management Agreement"); and
WHEREAS, the Investment Manager, acting pursuant to
the Investment Management Agreement and with the approval of
the Trust's Board, has retained the Sub-Adviser to provide
specified investment advisory services to each series of the Trust
listed in Appendix A hereto as it may be amended or supplemented
from time to time (the "Fund(s)") under the terms of an investment
sub-advisory agreement, dated April 1, 2014 and as amended or
supplemented from time to time, among the Trust, the Investment
Manager and the Sub-Adviser (the "Sub-Advisory Agreement"); and
WHEREAS, the Investment Manager and the Sub-Adviser
wish to retain the Manager, and the Trust's Board has approved the
retention of the Manager, to assist the Investment Manager and the
Sub-Adviser in the provision of investment advisory services to the
Fund(s), and
WHEREAS, the Manager is willing to provide those
services on the terms and conditions set forth in this Agreement;
NOW THEREFORE, the Trust, the Investment Manager,
the Sub-Adviser and the Manager agree as follows:
Section 1. The Trust. The Trust is engaged in the business
of investing and reinvesting its assets in securities of the type and
in accordance with the limitations specified in its Declaration of
Trust, as amended or supplemented from time to time, By-Laws (if
any) and Registration Statement filed with the U.S. Securities and
Exchange Commission (the "Commission") under the 1940 Act
and the U.S. Securities Act of 1933 (the "Securities Act"),
including any representations made in the prospectus and statement
of additional information relating to the Fund(s) contained therein
and as may be supplemented from time to time, all in such manner
and to such extent as may from time to time be authorized by the
Board.
Section 2. Appointment of Manager. Subject to the
direction and control of the Board, the Investment Manager has
been appointed to manage the investment and reinvestment of the
assets of the Fund(s) and to provide certain management and
related services specified in the Investment Management
Agreement with respect to the Fund(s).
Subject to the direction and control of the Board and the
Investment Manager, the Sub-Adviser has been appointed to
manage the investment and reinvestment of a certain portion of the
assets of the Fund(s) and to provide the management and related
services specified in the Sub-Advisory Agreement, all in such
manner and to such extent as may be directed from time to time by
the Board or the Investment Manager.
Subject to the direction and control of the Board, the
Investment Manager and the Sub-Adviser, and with the oversight
of the Investment Manager and the Sub-Adviser, the Manager is
hereby appointed and agrees to manage the investment and
reinvestment of that portion of the assets of the Fund(s) allocated
to it from time to time by the Board, the Investment Manager or
the Sub-Adviser and communicated to the Manager (the "Manager
Portion") and to provide the management and related services
specified herein, all in such manner and to such extent as may be
directed from time to time by the Board, the Investment Manager
or the Sub-Adviser and in accordance with the investment
strategies disclosed in the current prospectus and statement of
additional information of the Fund. Without limiting the generality
of the foregoing, the Board, the Investment Manager or the Sub-
Adviser may direct the Manager's provision of management
services with respect to the Manager Portion by delivering
investment guidelines, investment policies and investment
restrictions (as amended from time to time with reasonable prior
notice to the Manager, the "Investment Guidelines"), and the
Manager shall manage the investment and reinvestment of the
Manager Portion in accordance with the Investment Guidelines.
The investment authority granted to the Manager with respect to
the Manager Portion shall include only the authority to make
investment decisions with regard to the investment, reinvestment
and disposition of assets held by the Fund(s) in the Manager
Portion and to exercise whatever powers the Trust may possess
with respect to any of the assets in the Manager Portion, including,
but not limited to, the power to exercise rights, options, warrants,
conversion privileges, redemption privileges, and to tender
securities pursuant to a tender offer. To the extent that any
communication directing the provision of management services
with respect to the Manager Portion are made or delivered pursuant
to this Agreement by either the Investment Manager or the Sub-
Adviser, such communications or instruction, unless otherwise
specified, shall be deemed to have been made by both the
Investment Manager and the Sub-Adviser. To the extent that any
communication directing the provision of management services
with respect to the Manager Portion are made or delivered to the
Manager pursuant to this Agreement by the Trust, such
communications or instruction shall supersede any
communications or instruction provided by the Investment
Manager or the Sub-Adviser regarding the same matter.
Section 3. Duties and Representations and Warranties.
(a) The Manager shall make decisions with respect to
all purchases and sales of securities and other investment assets for
the Manager Portion of the Fund(s). To carry out such decisions,
the Manager is hereby authorized, as agent and attorney-in-fact for
the Trust, for the account of, at the risk of and in the name of the
Trust, to place orders and issue instructions with respect to those
transactions of the Fund(s) with respect to the Manager Portion
thereof. In all purchases, sales and other transactions in securities
and other investment assets for the Manager Portion of the
Fund(s), the Manager is authorized to exercise full discretion and
act for the Trust in the same manner and with the same force and
effect as the Trust 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. Subject to the
provisions of Section 2 and Section 7 hereof, the Manager shall
determine what portion of the Manager Portion's assets will be
invested or held uninvested as cash or cash equivalents. The
Manager is authorized on behalf of and in the name of the Fund(s)
to enter into executing broker agreements (including, without
limitation, Agreements for Prime Brokerage Clearance Services
(Form 151)), International Uniform Brokerage Execution Services
("Give-up") Agreements on reasonable and customary terms and in
compliance with law and regulation applicable to the Fund.
(b) The Manager acknowledges that the Fund(s) and
other mutual funds advised by the Investment Manager
(collectively, the "fund complex") may engage in transactions with
certain sub-advisers or other managers in the fund complex (and
their affiliated persons) in reliance on exemptions under Rule 10f-
3, Rule 12d3-1, Rule 17a-10 and Rule 17e-1 under the 1940 Act.
Accordingly, the Manager hereby agrees that it will not consult
with any other sub-adviser or manager of a fund in the fund
complex, or an affiliated person of a sub-adviser or manager,
concerning transactions for a fund in the fund complex in securities
or other fund assets. With respect to a multi-managed Fund(s), the
Manager shall be limited to managing only the Manager Portion as
may be determined from time-to-time by the Board, the Investment
Manager or the Sub-Adviser, and shall not consult with another
manager as to any other portion of the Fund(s)' portfolio
concerning transactions for the Fund(s) in securities or other Fund
assets. Notwithstanding the foregoing, nothing herein shall be
deemed to prohibit consultations between (i) a Manager that is not
an affiliated person of the Investment Manager or the Sub-Adviser
and a sub-adviser or manager that is an affiliated person of the
Investment Manager or the Sub-Adviser or (ii) a Manager that is
an affiliated person of the Investment Manager or Sub-Adviser and
any other sub-adviser or manager.
(c) The Manager will, at the request of the Investment
Manager, report to the Board at each regular meeting thereof all
material changes in the Manager Portion of the Fund(s) since the prior
report, and will also keep the Board informed of important
developments of which it becomes aware affecting the Trust, the
Manager Portion of the Fund(s) and the Manager, and on its own
initiative will furnish the Board from time to time with such
information as the Manager may believe appropriate with respect to
the portfolio of the Manager Portion. At the request of the Investment
Manager or the Sub-Adviser, the Manager shall review information
relating to the Manager or the Manager Portion contained in draft
shareholder reports and annual updates to prospectuses and other
documents and provide timely comments thereon. The Manager will
also furnish the Board with such statistical and analytical information
with respect to securities or other assets in the Manager Portion of the
Fund(s) as the Manager may believe appropriate or as the Board, the
Investment Manager or the Sub-Adviser reasonably may request. In
making purchases and sales of securities for the Manager Portion of
the Fund(s), the Manager will comply with the provisions, policies,
restrictions and other requirements set forth in Section 7 of this
Agreement.
(d) The Manager shall promptly notify the Investment
Manager and the Sub-Adviser (i) of any changes regarding the
Manager that would be reasonably expected to impact disclosure in the
Trust's Registration Statement, including, without limitation, any
change in the portfolio manager(s) of the Manager responsible for
making investment decisions for the Fund(s), (ii) upon Manager
becoming aware of any violation of any requirement, provision, policy
or restriction that the Manager is required to comply with under
Section 7 of this Agreement, and (iii) upon Manager becoming aware
that it is, or is likely to become, subject to any statutory
disqualification pursuant to Section 9 of the 1940 Act or any other
event otherwise that prevents the Manager from performing its duties
pursuant to this Agreement. The Manager shall notify the Investment
Manager and the Sub-Adviser of any change in "control" (as such term
in defined in Section 2(a)(9) of the 0000 Xxx) of the Manager promptly
after the reasonable possibility of such event becomes known to
Manager. The Manager shall to the extent legally permitted, within
two business days, notify the Investment Manager, the Sub-Adviser
and the Trust of any legal process served upon it in which specifically
relate to its activities hereunder, including any legal process served
upon it on behalf of the Investment Manager, the Sub-Adviser, the
Fund(s) or the Trust; for purposes of the foregoing requirement to
provide notice, any routine request, sweep examination or inquiry of
any regulatory or self-regulatory agency with jurisdiction over the
Manager shall be presumed to not constitute legal process. The
Manager shall reasonably cooperate with the Fund(s)' custodian
("Custodian") in the Custodian's processing of class actions or other
legal proceedings relating to the holdings (historical and/or current) of
the Fund(s).
(e) The Manager shall supervise and monitor the
activities of its representatives, personnel and agents in connection
with the execution of its duties and obligations hereunder. The
appropriate personnel of the Manager will be made available to
consult with the Investment Manager, the Sub-Adviser, the Trust and
the Board at reasonable times and upon reasonable notice concerning
the Manager's performance of services hereunder. Without limiting
the generality of the foregoing, appropriate personnel of the Manager
will provide reasonable assistance to the Investment Manager and/or
the Board in the valuation of securities or other investment assets
held within the Manager Portion of the Fund(s) in accordance with
the Trust's Procedures for the Valuation of Portfolio Securities.
Notwithstanding the foregoing, neither the Manager nor any of its
affiliates, shall be ultimately responsible for the valuation of all
portfolio securities or other investment assets held by Fund.
(f) The Manager is not authorized to sub-contract or
otherwise delegate any of the services contemplated hereby to any
other person without the prior written consent of the Trust, the
Investment Manager and the Sub-Adviser, which consent may be
withheld for any reason. Any attempt to sub-contract or delegate
any such services without such consent shall be invalid.
(g) The Manager represents and warrants to the
Investment Manager, the Sub-Adviser and the Trust that: (i) the
Manager is registered as an investment adviser under the Advisers
Act and is registered or licensed as an investment adviser under the
laws of all jurisdictions in which its activities require it to be so
registered or licensed; (ii) the Manager is duly organized and validly
existing and has requisite power and authority to enter into and
perform its obligations under this Agreement; and (iii) the execution,
delivery and performance of this Agreement by the Manager has
been duly authorized by appropriate action of the Manager.
(h) Each of the Investment Manager and the Sub-Adviser
represents and warrants to the Manager (i) it is registered as an
investment adviser under the Advisers Act and is registered or
licensed as an investment adviser under the laws of all jurisdictions
in which its activities require it to be so registered or licensed; (ii) it
is duly organized and validly existing and has requisite power and
authority to enter into and perform its obligations under this
Agreement; and (iii) the execution, delivery and performance of this
Agreement by the Investment Manager and Sub-Adviser has been
duly authorized by appropriate action of the Investment Manager and
Sub-Adviser.
(i) The Trust on behalf of the Fund represents and
warrants that as of the date of this Agreement it is a "qualified
eligible person," as defined in U.S. Commodity Futures Trading
Commission ("CFTC") Regulation 4.7, who has evaluated the risks
of investing in the types of trading program contemplated in this
Agreement and consents to its treatment by the Manager as an
exempt account under Rule 4.7 of the U.S. Commodity Exchange
Act and it will promptly notify the Manager in the event that the
Trust ceases to satisfy the "portfolio requirement" as defined in
CFTC Regulation 4.7(a)(1)(v) and is not therefore a "qualified
eligible person," as defined in CFTC Regulation 4.7.
(j) The Trust represents and warrants that it has
procedures in place reasonably designed to comply with all antimoney
laundering and privacy regulations applicable to it.
Section 4. Delivery of Documents to the Manager. The
Investment Manager or the Sub-Adviser has furnished the Manager
with true, correct and complete copies of the following documents:
(a) The Declaration of Trust and Bylaws (if any), as in effect
on the date hereof;
(b) The Registration Statement filed with the Commission
under the 1940 Act, including the prospectuses related to
the Fund(s) included therein;
(c) The Investment Management Agreement and the Sub-
Advisory Agreement; and
(d) Written guidelines, policies and procedures adopted by the
Trust that are applicable to the Fund(s) and the Investment
Guidelines.
The Investment Manager or the Sub-Adviser will furnish
the Manager with all future amendments and supplements to the
foregoing as soon as practicable after such documents become
available. The Investment Manager or the Sub-Adviser shall
furnish the Manager with any further documents, materials or
information that the Manager may reasonably request in
connection with the performance of its duties hereunder.
The Manager shall furnish the Investment Manager or the
Sub-Adviser with written certifications, in such form as the
Investment Manager or the Sub-Adviser shall reasonably request,
that it has received and reviewed the most recent version of the
foregoing documents provided by the Investment Manager or the
Sub-Adviser and that it will comply with such documents in the
performance of its obligations under this Agreement.
Section 5. Delivery of Documents to the Investment
Manager and the Sub-Adviser. The Manager has furnished, and
in the future will furnish, the Investment Manager and the Sub-
Adviser with true, correct and complete copies of each of the
following documents:
(a) The Manager's most recent Form ADV;
(b) The current Code of Ethics of the Manager, adopted
pursuant to Rule 17j-1 under the 1940 Act, and annual
certifications from the Manager's Chief Compliance
Officer regarding compliance with such Code; and
(c) Copies of its policies and procedures adopted pursuant to
Rule 206(4)-7 under the Advisers Act, as amended from
time to time, and, if available, a summary report
memorializing the results of the annual review of the
adequacy of such policies and procedures.
In addition, the Manager will furnish to, or make available
for inspection by, the Investment Manager and the Sub-Adviser
with a summary of the results of any examination of the Manager
by the Commission or other regulatory agency with respect to the
Manager's investment management activities.
The Manager will furnish the Investment Manager and the
Sub-Adviser with all such documents as soon as practicable after
such documents become available, to the extent that such
documents have been changed materially. The Manager shall, from
time to time, furnish the Investment Manager and the Sub-Adviser
with: (i) completed annual, quarterly and other periodic
compliance certifications and reports that the Investment Manager
or the Sub-Adviser requests as part of the Investment Manager's
compliance oversight program; (ii) certifications or subcertifications
which are reasonably necessary for the Fund(s)'
registration statement(s), Form N-CSR filings or other regulatory
filings, (iii) information and materials in connection with the
consideration of the continuation of this Agreement for approval as
set forth in Section 15 hereof, and (iv) such additional documents,
materials or information as the Investment Manager or the Sub-
Adviser may reasonably request for the purpose of inquiring into
or validating information provided pursuant to the foregoing subsections
5(i)-(iii).
Section 6. Control by Board. As is the case with respect
to the Investment Manager under the Investment Management
Agreement, and the Sub-Adviser under the Sub-Advisory
Agreement, any investment activities undertaken by the Manager
pursuant to this Agreement, as well as any other activities
undertaken by the Manager on behalf of the Fund(s), shall at all
times be subject to the direction and control of the Trust's Board.
Section 7. Compliance with Applicable Requirements. In
carrying out its obligations under this Agreement, the Manager
shall at all times comply with:
(a) all applicable provisions of the 1940 Act and the
Advisers Act, and any rules and regulations adopted thereunder;
(b) the provisions of the registration statement of the
Trust, as it may be amended or supplemented from time to time,
under the Securities Act and the 1940 Act;
(c) the provisions of the Declaration of Trust of the
Trust, as it may be amended or supplemented from time to time;
(d) the provisions of any By-laws of the Trust, if
adopted and as it may be amended from time to time, resolutions
of the Board as may be adopted from time to time, the applicable
provisions of written guidelines, policies and procedures adopted
by the Trust or the Board, and the Investment Guidelines;
(e) the provisions of the U.S. Internal Revenue Code of
1986, as amended (the "Code"), applicable to the Trust or the
Fund(s); and
(f) any other applicable provisions of state or federal
law;
provided, however, that in the event of any changes to the
obligations of the Manager arising from (i) revisions after the date
hereof to the Declaration of Trust of the Trust or any By-laws of
the Trust, (ii) resolutions of the Board or the provisions to the
Manager of written guidelines, policies and procedures adopted by
the Trust or the Board, or (iii) revisions to the Investment
Guidelines, the Manager shall not be required to comply with such
obligations unless the relevant documents have been provided to
the Manager and the Manager has had reasonably sufficient time to
review and understand such changed obligations prior to effecting
portfolio transactions.
For purposes of clarification, the parties agree that the
obligations of the Manager with respect to the foregoing will not
require the Manager to comply with such provisions of law
(including, without limitation, the income and diversification
provisions of Subchapter M of the Code) that apply specifically to
the management of the Fund(s)' assets or operation of the Fund(s)
as a whole and not individually to the Manager Portion.
In addition, without limiting the generality of the foregoing,
the Manager agrees that: (i) any code of ethics adopted by the
Manager must comply with Rule 17j-1 under the 1940 Act and
Rule 204A-1 under the Advisers Act, as they may be amended
from time to time (ii) the Investment Manager and the Trust may
disclose Fund(s) portfolio holdings information (including with
respect to the Manager Portion) in accordance with the Trust's
policies and procedures governing the disclosure of Fund(s)
portfolio holdings, as amended or supplemented from time to time,
and as required by applicable law or as otherwise provided
hereunder, and (iii) the Manager will not use, nor will it seek to
obtain, material non-public information concerning portfolio
companies in connection with performing its duties hereunder.
Section 8. Proxies. The Investment Manager shall have
responsibility to vote proxies solicited with respect to issuers of
securities in which assets of the Manager Portion of the Fund(s)
are invested from time to time in accordance with the Trust's
policies on proxy voting. The Manager will provide, when
requested by the Investment Manager, information on a particular
issuer to assist the Investment Manager in the voting of a proxy.
Section 9. Broker-Dealer Relationships. The Manager is
responsible for the purchase and sale of securities for the Manager
Portion of the Fund(s), broker-dealer selection, and negotiation of
brokerage commission rates. The Manager's primary
consideration in effecting a security transaction will be to seek to
obtain best execution under the circumstances. In selecting a
broker-dealer to execute each particular transaction for the
Manager Portion of the Fund(s), the Manager will consider such
factors it considers to be relevant to the transaction, which are
expected to include, among other things: the best net price
available, the reliability, integrity and financial condition of the
broker-dealer; the size of and difficulty in executing the order; and
the value of the expected contribution of the broker-dealer to the
Fund(s) and other clients of the Manager on a continuing basis.
Accordingly, the price to the Fund(s) in any transaction may be
less favorable than that available from another broker-dealer if the
Manager determines in good faith that the difference is reasonably
justified by other aspects of the portfolio execution services
offered. Subject to such policies as the Board may from time to
time determine and of which the Manager is informed, the
Manager shall not be deemed to have acted unlawfully or to have
breached any duty created by this Agreement or otherwise solely
by reason of having caused the Fund(s) with respect to the
Manager Portion to pay a broker or dealer that provides brokerage
and research services to the Manager an amount of commission for
effecting a portfolio investment transaction in excess of the amount
of commission another broker or dealer would have charged for
effecting that transaction, if the Manager determines in good faith
that such amount of commission was reasonable in relation to the
value of the brokerage and research services provided by such
broker or dealer, viewed in terms of either that particular
transaction or the overall responsibilities of the Manager with
respect to the Manager Portion of the Fund(s) and to other clients
of the Manager. The Manager is further authorized to allocate the
orders placed by it on behalf of the Manager Portion of the Fund(s)
to brokers and dealers who provide brokerage and research
services within the meaning of Section 28(e) of the Securities
Exchange Act of 1934 and in compliance therewith. Such
allocation shall be in such amounts and proportions as the Manager
shall determine and the Manager will report on said allocations
regularly to the Board upon request, indicating the brokers to
whom such allocations have been made and the basis therefor.
Provided the investment objective of the Fund(s) is adhered
to, the Manager may aggregate sales and purchase orders of
securities for the Manager Portion of the Fund(s) with similar
orders being made for other portfolios managed by the Manager, if,
in the Manager's reasonable judgment, such aggregation is
conducted in a manner reasonably determined in good faith by the
Manager to be fair and equitable to the Fund(s) over time and
consistent with the Manager's fiduciary obligations to the Fund(s)
and other clients. The Manager represents and acknowledges that
it is solely responsible for complying, and agrees that it shall
comply, with any and all applicable pronouncements of the
Commission or its staff with respect to the requirements for
aggregating trades as may be set out in any interpretive release
and/or no-action letters issued by the Commission or its staff in its
execution of trades on behalf of the Fund(s). The Manager shall
not be responsible for any acts or omissions by any broker or
dealer, provided that the Manager did not act with gross negligence
or willful misconduct in the selection of such broker or dealer.
The Manager shall not engage in any transactions for the
Manager Portion of the Fund(s) with or through any broker-dealer
that (x) is an affiliated person of the Manager or (y) the Manager
has been notified in writing by the Investment Manager or the Sub-
Adviser is an affiliated person of the Investment Manager or the
Sub-Adviser except in compliance with all applicable regulations
of the Commission and the applicable policies and procedures of
the Trust governing such transactions.
Section 10. Expenses of the Fund(s). All of the ordinary
business expenses incurred in the operations of the Fund(s) and the
offering of their shares shall be borne by the Fund(s) unless
specifically provided otherwise in this Agreement. These expenses
borne by the Trust include, but are not limited to, brokerage
commissions, taxes, legal, auditing or governmental fees, the cost
of preparing share certificates, custodian, transfer agent and
shareholder service agent costs, expense of issue, sale, redemption
and repurchase of shares, expenses of registering and qualifying
shares for sale, expenses relating to trustees and shareholder
meetings, the cost of preparing and distributing reports and notices
to shareholders, the fees and other expenses incurred by the
Fund(s) in connection with membership in investment company
organizations and the cost of printing copies of prospectuses and
statements of additional information distributed to the Fund(s)'
shareholders. Additionally, the Fund(s) shall reimburse the
Manager for their pro rata portion of any trading, execution or
clearing expenses reasonably incurred by the Manager directly on
behalf of the Fund(s), including, without limitation, swap
execution facility clearing expenses, to the extent a detailed
invoice is provided by the Manager.
The Manager shall pay its own expenses in connection with
the services to be provided by it pursuant to this Agreement. In
addition, the Manager shall be responsible for reasonable out-ofpocket
costs and expenses incurred by the Investment Manager, the
Sub-Adviser or the Trust: to obtain shareholder approval of a new
sub-advisory agreement as a result of a change in "control" (as
such term in defined in Section 2(a)(9) of the 0000 Xxx) of the
Manager (which may include, without limitation, the costs of
preparing, printing and mailing a proxy statement for the
shareholder meeting and proxy solicitation services, among
others), or to otherwise comply with the 1940 Act, the Securities
Act, or any other applicable statute, law, rule or regulation, as a
result of such change in control.
Section 11. Compensation. As compensation for the subadvisory
services provided under this Agreement, the Investment
Manager shall pay the Manager fees, payable monthly, at the
annual rates indicated on Schedule A hereto, as such Schedule may
be amended or supplemented from time to time in a written
agreement by and among the Trust, the Investment Manager and
the Manager. It is understood that the Investment Manager shall
be responsible for the Manager's fee for its services hereunder, and
the Manager agrees that it shall have no claim against the Trust,
the Fund(s) or the Sub-Adviser with respect to compensation under
this Agreement.
Section 12. Standard of Care. The Trust and Investment
Manager and Sub-Adviser shall expect of the Manager, and the
Manager will give the Trust and the Investment Manager and Sub-
Adviser the benefit of, the Manager's best judgment and efforts in
rendering its services to the Trust, and the Manager shall not be
liable hereunder for any mistake in judgment. In the absence of
willful misfeasance, bad faith, gross negligence or reckless
disregard of obligations or duties hereunder on the part of the
Manager or any of its officers, partners, members, directors,
employees or agents, the Manager shall not be subject to liability
to the Investment Manager, the Sub-Adviser, the Trust or to any
shareholders in the Trust for any act or omission in the course of,
or connected with, rendering services hereunder or for any losses
that may be sustained in the purchase, holding or sale of any
security.
Section 13. Non-Exclusivity. The services of the Manager
to the Sub-Adviser, the Investment Manager and the Trust are not
to be deemed to be exclusive, and the Manager shall be free to, and
nothing contained in this Agreement shall limit its ability to, render
investment advisory and administrative or other services to others
(including other investment companies) and to engage in other
activities, including investing on its own or its affiliates' behalf in
compliance with applicable law and regulation. It is understood
and agreed that officers, partners, members or directors of the
Manager are not prohibited from engaging in any other business or
investing activity or from rendering services to any other person,
or from serving as partners, officers, directors or trustees of any
other firm or trust, including other investment advisory companies.
The Manager may on occasion give advice or take action with
respect to other investment entities that it manages that differs
from the advice given with respect to the Manager Portion.
Section 14. Records. The Manager shall, with respect to the
placing and allocation of brokerage orders placed by it for the
purchase and sale of portfolio securities or other investment assets
and other portfolio transactions of the Fund(s) in the Manager
Portion, maintain or arrange for the maintenance of the documents
and records required to be maintained by the Trust pursuant to
Rule 31a-1 under the 1940 Act and other applicable law or
regulation as well as trade tickets and confirmations of portfolio
trades and such other records as the Investment Manager or the
Fund(s)' Administrator and the Manager agree in writing shall be
maintained. All such records shall be maintained in a form in
compliance with the provisions of Rule 31a-1 or any successor rule
or other applicable law or regulation. The Manager shall prepare
and maintain, or cause to be prepared and maintained, in such
form, for such periods and in such locations as may be required by
applicable law, any and all other documents and records relating to
the services provided by the Manager pursuant to this Agreement
required to be prepared and maintained by the Trust pursuant to the
rules and regulations of any national, state, or local government
entity with jurisdiction over the Trust, including the Commission
and the Internal Revenue Service of the U.S. Department of
Treasury. All such records will be the property of the Trust, and
will be available for inspection and use by the Trust and its
authorized representatives (including the Investment Manager and
the Sub-Adviser) at all times during the Manager's normal
business hours, provided that the Trust and its authorized
representative shall provide the Manager with reasonable advance
notice in connection with routine use. The Manager shall
promptly, upon the request of the Trust or the Trust's authorized
representatives (including the Investment Manager and the Sub-
Adviser), surrender and deliver to the Fund(s) those records which
are the property of the Trust or any Fund(s). Notwithstanding
anything to the contrary contained herein, the Manager shall be
permitted to retain copies of such books and records at its own cost
and expense (and may retain originals and provide the Trust or its
representatives with copies to the extent necessary to comply with
Rule 204-2 under the Advisers Act). The Manager will promptly
notify the Fund(s)' Administrator if it experiences any difficulty in
maintaining the records in an accurate and complete manner.
Section 15. Term and Approval. This Agreement shall
become effective with respect to the Fund(s) after it is approved by
the Board of Trustees of the Trust, including by a majority of the
Trustees who are not interested persons of the Trust, and executed
by the Trust, Investment Manager, Sub-Adviser and Manager, and
shall continue in effect for more than two years from its effective
date, provided that the continuation of this Agreement is approved
in accordance with the requirements of the 1940 Act, which
currently requires that the continuation be approved at least
annually:
(a) (i) by the Trust's Board of Trustees or (ii) by the
vote of "a majority of the outstanding voting securities" of the
Fund(s) (as defined in Section 2(a)(42) of the 1940 Act), and
(b) by the affirmative vote of a majority of the Trust's
Trustees who are not parties to this Agreement or "interested
persons" (as defined in the 0000 Xxx) of a party to this Agreement
(other than as Trustees of the Trust), by votes cast in person at a
meeting specifically called for such purpose.
Section 16. Termination. As required under the 1940 Act,
this Agreement may be terminated with respect to the Fund(s) at
any time, without the payment of any penalty, by vote of the
Trust's Board of Trustees or by vote of a majority of the Fund(s)'
outstanding voting securities, or by the Investment Manager, Sub-
Adviser or Manager, on sixty (60) days' written notice to the other
party. The notice provided for herein may be waived by the party
entitled to receipt thereof. This Agreement shall automatically
terminate in the event of its assignment, the term "assignment" for
purposes of this paragraph having the meaning defined in Section
2(a)(4) of the 1940 Act, as it may be interpreted by the
Commission or its staff in interpretive releases, or applied by the
Commission staff in no-action letters, issued under the 1940 Act.
This Agreement shall automatically terminate in the event of the
termination of the Investment Management Agreement. This
Agreement may also be terminated immediately by the Investment
Manager, the Sub-Adviser or the Trust in the event that the
Manager commits a material violation of any governing law or
regulation.
Section 17. Indemnification by the Manager. In the
absence of willful misfeasance, bad faith, gross negligence or
reckless disregard of obligations or duties hereunder on the part of
the Trust, the Investment Manager or the Sub-Adviser, or any of
their respective officers, partners, members, directors, employees,
affiliates or agents, the Manager agrees to indemnify and hold the
Trust, any Fund(s) of the Trust, the Investment Manager and the
Sub-Adviser and their respective officers, partners, members,
directors, employees, affiliates and agents (severally, but not
jointly) harmless from and against, any and all losses, damages,
costs, charges, external counsel fees, payments, expenses, liability,
claims, actions, suits or proceedings at law or in equity whether
brought by a private party or a governmental department,
commission, board, bureau, agency or instrumentality of any kind,
except for special, punitive and indirect damages, arising out of or
attributable to the willful misfeasance, bad faith, grossly negligent
acts or reckless disregard of obligations or duties of the Manager
or any of its officers, partners, members, directors, employees or
agents. The Manager shall not be liable hereunder for any losses
or damages resulting from the Manager's adherence to the written
instructions of the Trust, the Investment Manager or the Sub-
Adviser.
Section 18. Indemnification by the Trust, the Investment
Manager and the Sub-Adviser. In the absence of willful
misfeasance, bad faith, gross negligence or reckless disregard of
duties hereunder on the part of the Manager or any of its officers,
partners, members, directors, employees or agents, the Trust, the
Investment Manager and the Sub-Adviser hereby agree to
indemnify and hold harmless the Manager, its affiliates and their
respective officers, partners, members, directors and employees
harmless from and against any and all losses, damages, costs,
charges, external counsel fees, payments, expenses, liability,
claims, actions, suits or proceedings at law or in equity whether
brought by a private party or a governmental department,
commission, board, bureau, agency or instrumentality of any kind,
except for special, punitive and indirect damages, arising from: (i)
the advertising, solicitation, sale, purchase or pledge of securities,
whether of the Fund(s) or other securities, undertaken by the
Fund(s), their officers, directors, employees or affiliates, (ii) any
violations of the securities laws, rules, regulations, statutes and
codes, whether federal or of any state, by the Fund(s), the
Investment Manager or the Sub-Adviser, and their respective
officers, directors, employees or affiliates, or (iii) the willful
misfeasance, bad faith, grossly negligent acts or reckless disregard
of obligations or duties hereunder on the part of the Fund(s), the
Investment Manager and the Sub-Adviser or their respective
officers, directors, employees, affiliates or agents; provided,
however, the Sub-Adviser shall have no obligation to indemnify
and hold harmless the Manager with respect to any of the
foregoing matters to the extent the Sub-Adviser did not commit
such violations, take such actions or act in such manner. Federal
and state securities laws impose liabilities under certain
circumstances on persons who act in good faith, and nothing herein
or in Section 17 shall constitute a waiver or limitation of any rights
which the Fund(s) may have and which may not be waived under
any applicable federal and state securities laws.
Section 19. Notices. Any notices under this Agreement shall
be in writing, addressed and delivered or mailed postage paid to
the other parties at such address as such other parties may
designate for the receipt of such notice or emailed (subject to
confirmation of receipt) to such parties as the parties designate in
writing. Until further notice to the other parties, it is agreed that
the address of the Trust shall be 000 Xxxxxx Xxxxxx, 00xx Xxxxx, Xxx
Xxxxxxxxx, Xxxxxxxxxx 00000, Attention: Xxxxx Xxxxxxx, and that of
the Investment Manager shall be 000 Xxxxxx Xxxxxx, 00xx Xxxxx,
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000, Attention: C. Xxxxx Xxxxxxx,
and that of the Sub-Adviser shall be 0000 Xxxxxxxxxxx Xxxxxx,
X.X., Xxxxx 000, Xxxxxxxxxx, X.X. 00000, Attention: Xxxxxx
Xxxxxxx, and that of the Manager shall be 00 Xxxxxx Xxxxxx, Xxx
Xxxxxxxxx, Xxxxxxxxxxx 00000, Attention: General Counsel.
Section 20. Questions of Interpretation. Any question of
interpretation of any term or provision of this Agreement having a
counterpart in or otherwise derived from a term or provision of the
1940 Act shall be resolved by reference to such terms or provision
of the 1940 Act and to interpretations thereof, if any, by the United
States Courts or in the absence of any controlling decision of any
such court, by rules, regulations or orders of the Commission, or
interpretations of the Commission or its staff, or Commission staff
no-action letters, issued pursuant to the 1940 Act. In addition,
where the effect of a requirement of the 1940 Act or the Advisers
Act reflected in any provision of this Agreement is revised by rule,
regulation or order of the Commission, such provision shall be
deemed to incorporate the effect of such rule, regulation or order.
The duties and obligations of the parties under this Agreement
shall be governed by and construed in accordance with the laws of
the State of Delaware to the extent that state law is not preempted
by the provisions of any law of the United States heretofore or
hereafter enacted.
Section 21. Amendment. 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 which enforcement of the change, waiver, discharge or
termination is sought. If shareholder approval of an amendment is
required under the 1940 Act, no such amendment shall become
effective until approved by a vote of the majority of the
outstanding shares of the affected Fund(s). Otherwise, a written
amendment of this Agreement is effective upon the approval of the
Board, the Investment Manager, the Sub-Adviser and the Manager.
Section 22. Xxxxx Fargo Name. The Manager shall not,
without prior written consent of the Investment Manager: (i) use in
advertising, publicity or otherwise the name of "Xxxxx Fargo,"
including the name of Xxxxx Fargo & Co. or any of its affiliates,
nor any trade name, trademark, trade device, service xxxx, symbol,
logo or any abbreviation, contraction or simulation thereof owned
by Xxxxx Fargo & Co. or any of its affiliates; or (ii) represent,
directly or indirectly, that any product or any service provided by
the Manager has been approved or endorsed by Xxxxx Fargo & Co.
or any of its affiliates.
Section 23. Confidentiality. Subject to the provisions of
the last paragraph of Section 7 hereof and this Section 23, the
following shall be treated as confidential ("Confidential
Information"): (i) any information or recommendations supplied
by the Manager or which the Trust, the Investment Manager or the
Sub-Adviser has access to in connection with the performance of
its obligations and duties hereunder, including without limitation
portfolio holdings in the Manager Portion, financial information or
other information relating to the Manager; and (ii) any records and
other information relative to the Trust, the Fund(s), the Investment
Manager and the Sub-Adviser which the Manager receives or has
access to in the performance of its duties in connection with the
performance of its obligations and duties hereunder, including
without limitation, prior, present or potential shareholders and
clients, the list of Fund(s) portfolio securities, instruments and
assets and liabilities of the Fund(s). Except as may be required by
applicable law or rule or as requested by regulatory or selfregulatory
authorities or judicial process, Confidential Information
may be disclosed to or used only as necessary to carry out the
purposes of this Agreement (including, without limitation, the
disclosure of Confidential Information to, or the use of the same
by, the Fund(s)' Custodian and fund accountant and other service
providers supporting the operation of the Fund(s), the Fund(s)' and
Manager's auditors, legal advisors to any party, and such other
persons as the Fund(s), the Investment Manager and the Sub-
Adviser may designate in connection with the operation and
management of the Manager Portion). The Manager shall not use
its knowledge of Confidential Information regarding the Fund(s)'
portfolio as a basis to place or recommend any securities or other
transactions for its own benefit or the benefit of others or to the
detriment of the Fund(s).
The Manager hereby authorizes the Fund(s), the
Investment Manager and the Sub-Adviser to use the Manager's
name and information about the Manager and all related evaluation
material, analyses and information regarding the Manager and the
investment program of the Manager Portion of the Fund(s),
including information about portfolio holdings and positions, in
connection with: (i) marketing the Fund(s) in written materials
relating to the Fund(s) that refer to the Manager and/or the
Manager's investment strategy, including without limitation the
Fund's registration statement, shareholder reports and other
offering documents and marketing materials prepared for
distribution to shareholders of the Fund(s) or the public (such
materials, the "Marketing Materials"), (ii) providing any required
regulatory disclosures and (iii) as otherwise required by applicable
law; provided, however, that (a) all such use and any related
disclosure shall comply with the Fund's relevant policies and
procedures; (b) all such use by the Fund(s), the Investment
Manager and the Sub-Adviser and their affiliated persons shall be
conducted in good faith for the sole purposes of the matters
described in the immediately preceding sub-clauses (i)-(iii),
satisfying their respective obligations under this Agreement, and
performing their respective duties under the Investment
Management Agreement and the Sub-Advisory Agreement,
including, without limitation, the supervision and monitoring of the
Manager, and applicable policies and procedures of the Fund(s);
and (c) the Fund(s) and the Investment Manager agree to furnish
Marketing Materials to the Manager (via email at an address
designated by the Manager from time to time), for its prior review
and approval (which approval shall not be withheld or withdrawn
as to information required by applicable law or in response to
comments of regulatory or self-regulatory agencies and their staff),
provided the requirement for prior approval shall apply solely with
respect to the use of the Manager's name and information
specifically concerning the Manager and its investment strategy
and not to any other content of the Marketing Materials. If,
following the furnishing of Marketing Materials, the Fund(s) or the
Investment Manager do not receive a written response from the
Manager with respect to such materials within one business day of
its submission for approval, the content of such materials subject to
the Manager's approval shall be deemed accepted by the Manager.
The Manager agrees that the Fund(s) and the Investment Manager
may request that the Manager approve the use of a type of
Marketing Material, and if affirmatively approved by the Manager,
that the Fund(s) and the Investment Manager need not obtain
approval for each additional piece of Marketing Material that is of
substantially the same type or form, unless such consent is
withdrawn in writing by the Manager.
The confidentiality provisions of this Section 23 will not
apply to any information that: (i) is or subsequently becomes
publicly available without breach of any obligation owed to
another party; (ii) became known to a party from a source other
than another party, and without breach of an obligation of
confidentiality owed to another party; (iii) is independently
developed by any party without reference to the information
required by this Agreement to be treated confidentially; or (iv) is
used by any party in order to enforce any of its rights, claims or
defenses under, or as otherwise contemplated in, this Agreement.
Nothing in this Section 23 will be deemed to prevent a party from
disclosing any information received hereunder pursuant to any
applicable law or in response to a request from a regulatory, self-
regulatory or judicial authority.
Notwithstanding anything contained herein to the
contrary, subject to and in compliance with applicable law, the
Manager may disclose composite performance information or
aggregated risk metrics information that includes information in
respect of the Manager Portion without the prior written consent of
the Trust, the Investment Manager or the Sub-Adviser, provided
that any such disclosure does not identify the Trust, the Fund(s),
the Investment Manager or the Sub-Adviser.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed in duplicate by their respective officers
on the day and year first written above.
XXXXX FARGO FUNDS TRUST
on behalf of the Fund(s)
By:
--------------------
C. Xxxxx Xxxxxxx
Secretary
XXXXX FARGO FUNDS MANAGEMENT, LLC
By:
--------------------
Xxxx Xxxxx
Senior Vice President
THE ROCK CREEK GROUP, LP
By:
--------------------
Name:
Title:
XXXXXXXXX GLOBAL ASSET MANAGEMENT LLC
By:
--------------------
Name:
Title:
APPENDIX A
Xxxxxxxxx Global Asset Management LLC
SUB-ADVISORY AGREEMENT
XXXXX FARGO FUNDS TRUST
Xxxxx Fargo Alternative Strategies Fund
Approval by the Board of Trustees: May 25, 2016
SCHEDULE A
Xxxxxxxxx Global Asset Management LLC
INVESTMENT SUB-ADVISORY AGREEMENT
FEE AGREEMENT
XXXXX FARGO FUNDS TRUST
This fee agreement is made as of the 25th day of May 2016,
by and among Xxxxx Fargo Funds Trust, Xxxxx Fargo Funds
Management, LLC (the "Investment Manager"), and Xxxxxxxxx
Global Asset Management LLC (the "Manager"); and
WHEREAS, the Investment Manager, the Manager, The
Rock Creek Group LP and Xxxxx Fargo Funds Trust (the "Trust")
have entered into an Investment Sub-Advisory Agreement
("Manager Sub-Advisory Agreement") whereby the Manager
provides investment management services with respect to certain
assets of each series of the Trust listed in Appendix A to the
Manager Sub-Advisory Agreement (the "Fund(s)").
WHEREAS, the Manager Sub-Advisory Agreement
provides that the fees to be paid by the Investment Manager to the
Manager are to be as agreed upon in writing by the parties.
NOW THEREFORE, the parties agree that the fees to be
paid by the Investment Manager to the Manager under the
Manager Sub-Advisory Agreement shall be calculated as follows
on a monthly basis by applying the annual rates indicated below to
the average daily net assets of the Manager Portion (as defined in
the Manager Sub-Advisory Agreement) of the Fund(s) throughout
the month:
----------------------------------------------------------
Fund Name Sub-Advisory Fee as % of Avg.
Daily Net Assets
----------------------------------------------------------
Alternative Strategies Fund 1.00
----------------------------------------------------------
If the Manager shall provide management and other
services for less than the whole of a month, the foregoing
compensation shall be prorated based on the number of days in the
month that such Manager provided management and other services
to the Fund(s). The fees to be paid to the Manager pursuant to this
Fee Agreement shall be payable in arrears not later than 30 days
following the month to which such fees relate.
The foregoing fee schedule is agreed to as of this 25th day
of May 2016, and shall remain in effect until agreed and changed
in writing by the parties.
XXXXX FARGO FUNDS TRUST
on behalf of the Fund(s)
By:
--------------------
C. Xxxxx Xxxxxxx
Secretary
XXXXX FARGO FUNDS MANAGEMENT, LLC
By:
--------------------
Xxxx Xxxxx
Senior Vice President
XXXXXXXXX GLOBAL ASSET MANAGEMENT LLC
By:
--------------------
Name:
Title:
