EXHIBIT (d)7
INVESTMENT SUB-ADVISORY AGREEMENT
TIP FUNDS
AGREEMENT made this 31st day of December, 1997, between Xxxxxx Investment
Partners, Inc. (the "Adviser") and Chartwell Investment Partners (the
"Sub-Adviser").
WHEREAS, TIP Funds, a Massachusetts business trust (the "Trust") is
registered as an open-end management investment company under the Investment
Company Act of 1940, as amended (the "1940 Act"); and
WHEREAS, the Adviser has entered into an Investment Advisory Agreement
dated December 31, 1997 (the "Advisory Agreement") with the Trust, pursuant to
which the Adviser will act as investment adviser to the TIP Target Select Equity
Fund (the "Fund"), which is a series of the Trust; and
WHEREAS, the Adviser, with the approval of the Trust, desires to retain the
Sub-Adviser to provide investment advisory services to the Adviser in connection
with the management of the Fund, and the Sub-Adviser is willing to render such
investment advisory services.
NOW, THEREFORE, the parties hereto agree as follows:
1. DUTIES OF THE SUB-ADVISER. Subject to supervision by the Adviser and
the Trust's Board of Trustees, the Sub-Adviser shall manage all of the
securities and other assets of the Fund entrusted to it hereunder (the
"Assets"), including the purchase, retention and disposition of the
Assets, in accordance with the Fund's investment objectives, policies
and restrictions as stated in the Fund's prospectus and statement of
additional information, as currently in effect and as amended or
supplemented from time to time (referred to collectively as the
"Prospectus"), and subject to the following:
(a) The Sub-Adviser shall, in consultation with and subject to the
direction of the Adviser, determine from time to time what
Assets will be purchased, retained or sold by the Fund, and
what portion of the Assets will be invested or held uninvested
in cash.
(b) In the performance of its duties and obligations under this
Agreement, the Sub-Adviser shall act in conformity with the
Trust's Declaration of Trust (as defined herein) and the
Prospectus and with the instructions and directions of the
Adviser and of the Board of Trustees of the Trust and will
conform to and comply with the requirements of the 1940 Act,
the Internal Revenue Code of 1986, and all other applicable
federal and state laws and regulations, as each is amended
from time to time.
(c) The Sub-Adviser shall determine the Assets to be purchased
or sold by the Fund as provided in subparagraph (a) and will
place orders with or through such persons, brokers or
dealers to carry out the policy with respect to brokerage
set forth in the Fund's Registration Statement (as defined
herein) and Prospectus or as the Board of Trustees or the
Adviser may direct from time to time, in conformity with
federal securities laws. In executing Fund transactions and
selecting brokers or dealers, the Sub-Adviser will use its
best efforts to seek on behalf of the Fund the best overall
terms available. In assessing the best overall terms
available for any transaction, the Sub-Adviser shall
consider all factors that it deems relevant, including the
breadth of the market in the security, the price of the
security, the financial condition and execution capability of
the broker or dealer, and the reasonableness of the
commission, if any, both for the specific transaction and on a
continuing basis. In evaluating the best overall terms
available, and in selecting the broker-dealer to execute a
particular transaction, the Sub-Adviser may also consider the
brokerage and research services provided (as those terms are
defined in Section 28(e) of the Securities Exchange Act of
1934). Consistent with any guidelines established by the Board
of Trustees of the Trust, the Sub-Adviser is authorized to pay
to a broker or dealer who provides such brokerage and research
services a commission for executing a fund transaction for the
Fund which is in excess of the amount of commission another
broker or dealer would have charged for effecting that
transaction if, but only if, the Sub-Adviser determines in
good faith that such commission was reasonable in relation to
the value of the brokerage and research services provided by
such broker or dealer - - viewed in terms of that particular
transaction or terms of the overall responsibilities of the
Sub-Adviser to the Fund. In addition, the Sub-Adviser is
authorized to allocate purchase and sale orders for securities
to brokers or dealers (including brokers and dealers that are
affiliated with the Adviser, Sub-Adviser or the Trust's
principal underwriter) to take into account the sale of shares
of the Trust if the Sub-Adviser believes that the quality of
the transaction and the commission are comparable to what they
would be with other qualified firms. In no instance, however,
will the Fund's Assets be purchased from or sold to the
Adviser, Sub-Adviser, the Trust's principal underwriter, or
any affiliated person of either the Trust, Adviser, the
Sub-Adviser or the principal underwriter, acting as principal
in the transaction, except to the extent permitted by the
Securities and Exchange Commission ("SEC") and the 1940 Act.
(d) The Sub-Adviser shall maintain all books and records with
respect to transactions involving the Assets required by
subparagraphs (b)(5), (6), (7), (9), (10) and (11) and
paragraph (f) of Rule 31a-1 under the 1940 Act. The
Sub-Adviser shall provide to the Adviser or the Board of
Trustees such periodic and special reports, balance sheets or
financial information, and such other information with regard
to its affairs as the Adviser or Board of Trustees may
reasonably request.
The Sub-Adviser shall keep the books and records relating to
the Assets required to be maintained by the Sub-Adviser under this
Agreement and shall timely furnish to the Adviser all information
relating to the Sub-Adviser's services under this Agreement needed by
the Adviser to keep the other books and records of the Fund required by
Rule 31a-1 under the 1940 Act. The Sub-Adviser shall also furnish to
the Adviser any other information relating to the Assets that is
required to be filed by the Adviser or the Trust with the SEC or sent
to shareholders under the 1940 Act (including the rules adopted
thereunder) or any exemptive or other relief that the Adviser or the
Trust obtains from the SEC. The Sub-Adviser agrees that all records
that it maintains on behalf of the Fund are property of the Fund and
the Sub-Adviser will surrender promptly to the Fund any of such records
upon the Fund's request; provided, however, that the Sub-Adviser may
retain a copy of such records. In addition, for the duration of this
Agreement, the Sub-Adviser shall preserve for the periods prescribed by
Rule 31a-2 under the 1940 Act any such records as are required to be
maintained by it pursuant to this Agreement, and shall transfer said
records to any successor sub-adviser upon the termination of this
Agreement (or, if there is no successor sub-adviser, to the Adviser).
(e) The Sub-Adviser shall provide the Fund's custodian on each
business day with information relating to all transactions
concerning the Fund's Assets and shall provide the Adviser
with such information upon request of the Adviser.
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(f) The investment management services provided by the Sub-Adviser
under this Agreement are not to be deemed exclusive and the
Sub-Adviser shall be free to render similar services to
others, as long as such services do not impair the services
rendered to the Adviser or the Trust.
(g) The Sub-Adviser shall promptly notify the Adviser of any
financial condition that is likely to impair the Sub-Adviser's
ability to fulfill its commitment under this Agreement.
(h) The Sub-Adviser shall review all proxy solicitation materials
and be responsible for voting and handling all proxies in
relation to the Assets. The Adviser shall instruct the
custodian and other parties providing services to the Fund to
promptly forward misdirected proxies to the Sub-Adviser.
Services to be furnished by the Sub-Adviser under this Agreement may be
furnished through the medium of any of the Sub-Adviser's partners,
officers or employees.
2. DUTIES OF THE ADVISER. The Adviser shall continue to have
responsibility for all services to be provided to the Fund pursuant to
the Advisory Agreement and shall oversee and review the Sub-Adviser's
performance of its duties under this Agreement; provided, however,
that in connection with its management of the Assets, nothing herein
shall be construed to relieve the Sub-Adviser of responsibility for
compliance with the Trust's Declaration of Trust (as defined herein),
the Prospectus, the instructions and directions of the Board of
Trustees of the Trust, the requirements of the 1940 Act, the Internal
Revenue Code of 1986, and all other applicable federal and state laws
and regulations, as each is amended from time to time.
3. DELIVERY OF DOCUMENTS. The Adviser has furnished the Sub-Adviser with
copies properly certified or authenticated of each of the following
documents:
(a) The Trust's Agreement and Declaration of Trust, as filed with
the Secretary of State of the Commonwealth of Massachusetts
(such Agreement and Declaration of Trust, as in effect on the
date of this Agreement and as amended from time to time,
herein called the "Declaration of Trust");
(b) By-Laws of the Trust (such By-Laws, as in effect on the date
of this Agreement and as amended from time to time, are herein
called the "By-Laws");
(c) Prospectus(es) of the Fund.
4. COMPENSATION TO THE SUB-ADVISER. For the services to be provided by
the Sub-Adviser pursuant to this Agreement, the Adviser will pay the
Sub-Adviser, and the Sub-Adviser agrees to accept as full compensation
therefor, a sub-advisory fee at the rate specified in the Schedule(s)
which is attached hereto and made part of this Agreement. The fee will
be calculated based on the average MONTHLY MARKET VALUE OF THE ASSETS
under the Sub-Adviser's management and will be paid to the Sub-Adviser
monthly. Except as may otherwise be prohibited by law or regulation
(including any then current SEC staff interpretation), the Sub-Adviser
may, in its discretion and from time to time, waive a portion of its
fee.
5. INDEMNIFICATION. The Sub-Adviser shall indemnify and hold harmless the
Adviser from and against any and all claims, losses, liabilities or
damages (including reasonable attorney's fees and other related
expenses) howsoever arising from or in connection with the performance
of the Sub-Adviser's obligations under this Agreement; provided,
however, that the Sub-Adviser's obligation
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under this Section 5 shall be reduced to the extent that the claim
against, or the loss, liability or damage experienced by the Adviser,
is caused by or is otherwise directly related to the Adviser's own, or
any other sub-adviser's, willful misfeasance, bad faith or negligence,
or to the reckless disregard of its duties under this Agreement.
6. DURATION AND TERMINATION. This Agreement shall become effective upon
its approval by the Trust's Board of Trustees and by the vote of a
majority of the outstanding voting securities of the Fund. This
Agreement shall continue in effect for a period of more than two years
from the date hereof only so long as continuance is specifically
approved at least annually in conformance with the 1940 Act; provided,
however, that this Agreement may be terminated with respect to the
Fund (a) by the Fund at any time, without the payment of any penalty,
by the vote of a majority of Trustees of the Trust or by the vote of a
majority of the outstanding voting securities of the Fund, (b) by the
Adviser at any time, without the payment of any penalty, on not more
than 60 days' nor less than 30 days' written notice to the
Sub-Adviser, or (c) by the Sub-Adviser at any time, without the
payment of any penalty, on 90 days' written notice to the Adviser.
This Agreement shall terminate automatically and immediately in the
event of its assignment, or in the event of a termination of the
Adviser's agreement with the Trust. As used in this Section 6, the
terms "assignment" and "vote of a majority of the outstanding voting
securities" shall have the respective meanings set forth in the 1940
Act and the rules and regulations thereunder, subject to such
exceptions as may be granted by the SEC under the 1940 Act.
7. GOVERNING LAW. This Agreement shall be governed by the internal laws of
the Commonwealth of Pennsylvania, without regard to conflict of law
principles; provided, however, that nothing herein shall be construed
as being inconsistent with the 1940 Act.
8. SEVERABILITY. Should any part of this Agreement be held invalid by a
court decision, statute, rule or otherwise, the remainder of this
Agreement shall not be affected thereby. This Agreement shall be
binding upon and shall inure to the benefit of the parties hereto and
their respective successors.
9. NOTICE. Any notice, advice or report to be given pursuant to this
Agreement shall be deemed sufficient if delivered or mailed by
registered, certified or overnight mail, postage prepaid addressed by
the party giving notice to the other party at the last address
furnished by the other party:
To the Adviser at: Xxxxxx Investment Partners, Inc.
0000 Xxxxxxxxx Xxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxxxxxx 00000
To the Sub-Adviser at: Chartwell Investment Partners
10. ENTIRE AGREEMENT. This Agreement embodies the entire agreement and
understanding between the parties hereto, and supersedes all prior
agreements and understandings relating to this Agreement's subject
matter. This Agreement may be executed in any number of counterparts,
each of which shall be deemed to be an original, but such counterparts
shall, together, constitute only one instrument.
A copy of the Declaration of Trust is on file with the Secretary of State
of the Commonwealth of Massachusetts, and notice is hereby given that the
obligations of this instrument are not binding upon any of the Trustees,
officers or shareholders of the Fund or the Trust.
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Where the effect of a requirement of the 1940 Act reflected in any
provision of this Agreement is altered by a rule, regulation or order of the
SEC, whether of special or general application, such provision shall be deemed
to incorporate the effect of such rule, regulation or order.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their officers designated below as of the day and year first written
above.
Xxxxxx Investment Partners, Inc. Chartwell Investment Partners
By: /s/ Xxxxxxx X. Xxxxxxx By: /s/ Xxxxxxxx X. Xxxxxx
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Name: Xxxxxxx X. Xxxxxxx Name: Xxxxxxxx X. Xxxxxx
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Title: Chief Operating Officer Title: President
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SCHEDULE A
TO THE
SUB-ADVISORY AGREEMENT
BETWEEN
XXXXXX INVESTMENT PARTNERS, INC.
AND
CHARTWELL INVESTMENT PARTNERS
Pursuant to Article 4, the Adviser shall pay the Sub-Adviser compensation at an
annual rate as follows:
TIP Target Select Equity Fund .80%
