INTERIM INVESTMENT SUB-ADVISORY AGREEMENT
AGREEMENT made as of this 14th day of July, 2009 by and among Old
Mutual Capital, Inc. (the "Adviser"), Xxxxxx Capital Partners LLC, on behalf
of Xxxxxx Capital Partners, LP (the "Sub-Adviser"), and Old Mutual Funds I, a
Delaware statutory trust (the "Trust"), on behalf of the Old Mutual China Fund
(the "Portfolio"). WHEREAS, the Trust is registered as an open-end
management investment company under the Investment Company Act of 1940,
as amended (the "1940 Act");
WHEREAS, the Adviser currently provides investment advisory services to the
Portfolio pursuant to an Investment Advisory Agreement between the Adviser
and the Trust, on behalf of the Portfolio (the "Advisory Agreement");
WHEREAS, the Investment Sub-Advisory Agreement between the Adviser,
Xxxx Xxxxxx LLC, and the Trust, on behalf of the Portfolio (the "Prior Sub-
Advisory Agreement"), will be terminated as of the close of business on
July 17, 2009;
WHEREAS, the Board of Trustees of the Trust has approved, subject to
shareholder approval, an Agreement and Plan of Reorganization, pursuant to
which the Portfolio will transferall of its assets to Xxxxxx/ALPS China Fund,
a new fund which is to be created for which the Sub-Adviser will serve as
sub-adviser, in exchange for shares of Xxxxxx/ALPS China Fund, to be
distributed pro rata to shareholders of the Portfolio (the "Reorganization");
WHEREAS, it is expected that the Reorganization would be completed on
or aboutDecember 16, 2009;
WHEREAS, the Board of Trustees of the Trust, including a majority of
the independent trustees, has appointed the Sub-Adviser as the new interim
investment sub-adviser to the Portfolio;
WHEREAS, the Adviser and the Trust, on behalf of the Portfolio, each desire to
retain the Sub-Adviser to provide investment advisory services to the Trust in
connection with the management of the Portfolio, and the Sub-Adviser is
willing to render such investment advisory services to the Portfolio under
this Agreement until the Reorganization is consummated;
WHEREAS, the Fund, the Adviser and the Sub-Adviser desire to comply
with theprovisions of Rule 15a-4 including subsection (b) thereof
under the 1940 Act; andWHEREAS, the Trustees of the Trust, including
a majority of those Trustees who are not interested persons of the Trust,
have found that the scope and quality of services to be provided to the
Trust under this Agreement will be at least equivalent to the scope and
quality of services provided under the Prior Sub-Advisory Agreement.
NOW, THEREFORE, the parties hereto agree as follows:
I. (a) Subject to supervision by the Adviser and the Trust's Board of
Trustees, theSub-Adviser shall manage the investment operations of the
Portfolio and the composition of the Portfolio's investment portfolio,
including the purchase, retention and disposition thereof, in accordance
with the Portfolio's investment objectives, policies and restrictions
as stated in such Portfolio's Prospectus (such Prospectus and Statement of
Additional Information as currently in effect and as amended or
supplemented from time to time, being herein called the "Prospectus"),
and subject to the following understandings:
(1) The Sub-Adviser shall provide supervision of the Portfolio's
investments and determine from time to time what investments and
securities will be purchased, retained or sold by the Portfolio and what
portion of the assets will be invested or held uninvested in cash.
(2) In the performance of its duties and obligations under this Agreement, the
Sub-Adviser shall act in conformity with the Trust's Prospectus and with the
instructions and directions of the Adviser and of the Board of Trustees and
will conform and comply with the requirements of the 1940 Act, the Internal
Revenue Code of 1986, as amended, and all other applicable federal and
state laws and regulations, as each is amended from time to time.
(3) The Sub-Adviser shall determine the securities to be purchased or
sold by the Portfolio and will place orders with or through such persons,
brokers or dealers to carryout the policy with respect to brokerage set forth
in such Portfolio'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 providing the Portfolio with
investment supervision, the Sub-Adviser will give primary consideration to
securing the most favorable price and efficient execution. Within the
framework of this policy, the Sub-Adviser may consider the financial
responsibility, research and investment information and other services
provided by brokers or dealers who may effect or be a party to any such
transaction or other transactions to which the Sub-Adviser's other clients
may be a party. It is understood that it is desirable for the Portfolio that
the Sub-Advisor have access to (i) supplemental investment and market
research and (ii) security and economic analysis provided by brokers who
may execute brokerage transactions at a higher cost to the Portfolio than
may result when allocating brokerage to other brokers on the basis of
seeking the most favorable price and efficient execution. Therefore,
the Sub-Adviser is authorized to place orders for the purchase and
sale of securities for the Portfolio with brokers, subject to review by the
Trust's Board of Trustees 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 the Sub-Adviser's services to other clients.
On occasions when the Sub-Adviser deems the purchase or sale
of a security to be in the best interest of the Portfolio as well as other
clients of the Sub-Adviser, the Sub-Adviser, to the extent permitted by
applicable laws and regulations, may, but shall be under no obligation to,
aggregate the securities to be so purchased or sold in order to
obtain the most favorable price or lower brokerage commissions and
efficient execution. In such event, allocation of the securities so
purchased or sold, as well as the expenses incurred in the transaction,
will be made by the Sub-Adviser in the manner it considers to
be the most equitable and consistent with its fiduciary obligations to
the Portfolio and to such other clients.
(4) The Sub-Adviser at its expense will make available to the Trust's
Board of Trustees and the Adviser at reasonable times its portfolio
managers and other appropriate personnel, either in person or, at the
mutual convenience of the Adviser and the Sub-Adviser, by telephone,
in order to review the investment policies, performance and other
investment related information regarding the Portfolio and to consult
with the Trustees and Adviser regarding the Portfolio's investment
affairs, including economic, statistical and investment matters
related to the Sub-Adviser's duties hereunder, and will provide
periodic reports to the Adviser relating to the investment strategies
it employs. The Sub-Adviser and its personnel shall also cooperate
fully with counsel and auditors for, and the Chief Compliance Officers
of, the Adviser and the Trust.
(5) In accordance with procedures adopted by the Trust's Board of
Trustees, as amended from time to time, the Sub-Adviser is responsible
for assisting in the fair valuation of all Portfolio securities. The Sub-
Adviser will use its reasonable efforts to provide, based upon its
own expertise, and to arrange with parties independent of the Sub-
Adviser such as broker-dealers, for the provision of valuation
information or prices for securities for which prices are deemed by
the Adviser or Trust's administrator not to be readily available in the
ordinary course of business from an automated pricing service. In
addition, the Sub-Adviser will assist the Portfolio and its agents in
determining whether prices obtained for valuation purposes accurately
reflect market price information relating to the assets of the Portfolio
at such times as the Adviser shall reasonably request, including but
not limited to, the hours after the close of a securities market and
prior to the daily determination of the Portfolio's net asset value
per share.
(6) The Sub-Adviser at its expense will provide the Adviser and/or the
Trust'sChief Compliance Officer with such compliance reports relating
to its duties under this Agreement as may be requested from time to
time. Notwithstanding the foregoing, the Sub-Adviser will promptly
report to the Adviser any material violations of the federal securities
laws (as defined in Rule 38a-1 of the 0000 Xxx) that it is or should be
aware of or of any material violation of the Sub-Adviser's compliance
policies and procedures that pertain to the Portfolio, as well as any
change in portfolio manager(s) of the Portfolio.
(7) Unless otherwise directed by the Adviser or the Trust's Board of
Trustees, the Sub-Adviser will vote all proxies received in accordance
with the Trust's proxy voting policy or, if the Sub-Adviser has a proxy
voting policy approved by the Trust's Board of Trustees, the
Sub-Adviser's proxy voting policy. The Adviser shall instruct the
Portfolio's custodian to forward or cause to be forwarded to the
Sub-Adviser all relevant proxy solicitation materials. The Sub-Adviser
shall maintain and shall forward to the Portfolio or its designated agent
such proxy voting information as is necessary for the Portfolio to
timely file proxy voting results in accordance with Rule 30b1-4 of
the 0000 Xxx.
(8) The Sub-Adviser represents and warrants that it has adopted a
code of ethics meeting the requirements of Rule 17j-I under the 1940
Act and the requirements of Rule 204A-1 under the Investment Advisers
Act of 1940 and has provided the Adviser and the Trustees of the Portfolio
a copy of such code of ethics, together with evidence of its adoption,
and will promptly provide copies of any changes thereto, together with
evidence of their adoption. Upon request of the Adviser, but in any
event no less frequently than annually, the Sub-Adviser will supply
the Adviser a written report that (A) describes any issues arising under
the code of ethics or procedures since the Sub-Adviser's last report,
including but not limited to material violations of the code of ethics or
procedures and sanctions imposed in response to the material
violations; and (B) certifies that the procedures contained in the Sub-
Adviser's code of ethics are reasonably designed to prevent
"access persons" from violating the code of ethics.
(9) The Sub-Adviser will review draft reports to shareholders and
other documents provided or available to it and provide comments
on a timely basis. In addition, the Sub-Adviser and each officer and
portfolio manager thereof designated by the Adviser will
provide on a timely basis such certifications or sub-certifications as
the Adviser may reasonably request in order to support and facilitate
certifications required to be provided by the Trust's Principal
Executive Officer and Principal Financial Officer.
(10) The Sub-Adviser shall maintain all books and records with
respect to the Portfolio's portfolio transactions required by
subparagraphs (b)(5), (6), (7), (9), (10) and (11) and
paragraph (f) of Rule 31 a-I under the 1940 Act and shall render to the
Trust's Board of Trustees such periodic and special reports as the
Trust's Board of Trustees may reasonably request.
(11) The Sub-Adviser shall provide the Portfolio's custodian on each
business day with information relating to all transactions concerning
the Portfolio's assets and shall provide the Adviser with such
information upon request of the Adviser.
(12) (a) 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,
(b) Services to be furnished by the Sub-Adviser under this Agreement
may be furnished through the medium of any of the Sub-Adviser's
officers or employees.
(c) The Sub-Adviser shall keep the Portfolio's books and records
required to be maintained by the Sub-Adviser pursuant to paragraph
I (a) of 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
Portfolio required by Rule 31a-1 under the 1940 Act. The Sub-Adviser
agrees that all records that it maintains on behalf of the Portfolio
are property of the Portfolio and the Sub-Adviser will surrender promptly
to the Portfolio any of such records upon the Portfolio's request;
provided, however, that the Sub-Adviser may retain a copy of such
records. The Sub-Adviser further agrees to preserve for the periods
prescribed by Rule 3 I a-2 under the 1940 Act any such records
as are required to be maintained by it pursuant to paragraph I (a) of this
Agreement.
2. The Adviser shall continue to have responsibility for all services
to be provided to the Portfolio pursuant to the Advisory Agreement and
shall oversee and review the Sub-Adviser's performance of its
duties under this Agreement.
3. The Adviser has delivered to the Sub-Adviser copies of each
of the following documents and will deliver to it all future amendments
and supplements, if any:
(a) Certified resolutions of the Trust's Board of Trustees authorizing
the appointment of the Sub-Adviser and approving the form of this
Agreement;
(b) Registration Statement under the 1940 Act and the Securities
Act of 1933, as amended on Form N-IA (the "Registration Statement")
as filed with the Securities and Exchange Commission (the
"Commission") relating to the Portfolio and shares of the Portfolio's
beneficial shares, and all amendments thereto; and
(c) Prospectus of the Portfolio.
4. For the services to be provided by the Sub-Adviser pursuant to this
Agreement for thePortfolio, the Adviser will pay to the Sub-Adviser as
full compensation therefore a fee at an annual rate of the Portfolio's
average daily net assets, net 50% of any waivers, reimbursement
payments, supermarket fees and alliance fees waived, reimbursed
or paid by the Adviser and net of all breakpoints, as follows:
Old Mutual China Fund 1.00%
This fee will be paid to the Sub-Adviser from the Adviser's advisory
fee from the Portfolio. The fee will be computed daily and paid to
the Sub-Adviser xxxxxxx.Xx the extent that the Adviser is reimbursed
by the Trust for any waived fees or reimbursed expenses pursuant
to the terms of a separate expense limitation agreement between
the Trust and the Adviser, the Adviser will pay to the Sub-Adviser its
pro-rata share of any such reimbursed amount.
5. The Sub-Adviser shall not be liable for any error of judgment or
for any loss suffered by the Portfolio or the Adviser in connection with
performance of its obligations under this Agreement, except a loss
resulting from a breach of fiduciary duty with respect to the receipt
of compensation for services (in which case any award of
damages shall be limited to the period and the amount set forth in
Section 36(b)(3) of the 1940 Act), or a loss resulting from willful
misfeasance, bad faith or gross negligence on the Sub-Adviser's
part in the performance of its duties or from reckless disregard of its
obligations and duties under this Agreement, except as may otherwise
be provided under provisions of applicable state law which cannot
be waived or modified hereby.
6. This Agreement shall commence on the date on which the Prior
Investment Sub-Advisory Agreement is terminated (the "Commencement
Date") and continue until, the sooner of the date: (i) when the
Reorganization is consummated; or (ii) one hundred fifty (150)
days from the Commencement Date. Upon the sooner to occur of
the conditions described in clauses
(i) and (ii) above, the Portfolio will be deemed to have terminated
this Agreement. Notwithstanding the foregoing, this Agreement may
be terminated (a) at any time without penalty by the Trust upon the
vote of a majority of the Trustees or by vote of the majority of the
Portfolio's outstanding voting securities, upon ten (10) days' written
notice to the Adviser and the Sub-Adviser, (b) by the Adviser at any
time without penalty, upon sixty (60) days' written notice to the Trust,
or (c) by the Sub-Adviser at any time without penalty on (90) days'
written notice to the Trust and the Adviser. This Agreement will also
terminate automatically in the event of its assignment (as defined
in the 1940 Act).
7. Nothing in this Agreement shall limit or restrict the right of any of the
Sub-Adviser's partners, officers, or employees to engage in any other
business or to devote his or her time and attention in part to the
management or other aspects of any business, whether of a similar or
dissimilar nature, nor limit or restrict the Sub-Adviser's right to engage
in any other business or to render services of any kind to any other
corporation, firm, individual or association.
8. During the term of this Agreement, the Adviser agrees to furnish
the Sub-Adviser at its principal office all prospectuses, proxy statements,
reports to shareholders, sales literature or other materials prepared for
distribution to shareholders of the Portfolio, the Trust or the public
that refers to the Sub-Adviser or its clients in any way prior to use
thereof and not to use material if the Sub-Adviser reasonably objects
in writing within five business days (or such other period
as may be mutually agreed upon) after receipt thereof The Sub-
Adviser's right to object to such materials is limited to the portions
of such materials that expressly relate to the Sub-Adviser, its
services and its clients. The Adviser agrees to use its reasonable
best efforts to ensure that materials prepared by its employees or
agents or its affiliates that refer to the Sub-Adviser or its
clients in any way are consistent with those materials previously
approved by the Sub-Adviser as referenced in the first sentence of this
paragraph. Sales literature may be furnished to the Sub-
Adviser by first-class or overnight mail, facsimile transmission
equipment or hand delivery.
9. No Trustee or Shareholder of the Trust shall be personally liable
for any debts, liabilities, obligations or expenses incurred by or
contracted for under this Agreement.
10. No provisions 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, and no amendment of this
Agreement shall be effective until approved by the vote of the majority
of the outstanding voting securities of the Portfolio.
11. This Agreement shall be governed by the laws of the state of
Delaware; provided, however, that nothing herein shall be construed
as being inconsistent with the 1940 Act.
12. This Agreement embodies the entire agreement and understanding
among 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; all such counterparts shall
together, constitute only one instrument.
13.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.
