SUB-ADVISORY AGREEMENT
THIS INVESTMENT SUB-ADVISORY AGREEMENT (the “Agreement“) dated this 28th day of December 2017 by and between Mission Institutional Advisors, LLC, a Texas limited liability company (the “Adviser”), a registered investment adviser under the Investment Advisers Act of 1940, as amended, and Auour Investments, LLC a Massachusetts limited liability company (the “Sub-Adviser”), a registered investment adviser under the Investment Advisers Act of 1940, as amended.
WHEREAS, Adviser is registered as an investment adviser with the Securities and Exchange Commission (the “SEC”) under the Investment Advisers Act of 1940, as amended (the “Advisers Act”), and engages in the business of asset management;
WHEREAS, Sub-Adviser is also registered with the SEC as an investment adviser under the Advisers Act, and engages in the business of asset management;
WHEREAS, World Funds Trust, a Delaware Statutory Trust (the “Trust”) is registered as an open-end management investment company of the series type under the Investment Company Act of 1940, as amended (the “1940 Act”);
WHEREAS, the Adviser has been engaged by the Trust to provide investment management services to the separate series of the Trust which are listed on Schedule A to this Agreement (each a “Fund”);
WHEREAS, each Fund is registered under the Investment Company Act of 1940, as amended (the “1940 Act”) and each Fund’s shares are registered under the Securities Act of 1933, as amended (the “Securities Act”)
WHEREAS, the Adviser desires to retain the Sub-Adviser to render certain investment management services to each Fund, and the Sub-Adviser is willing to render such services; and
WHEREAS, the Trust has consented to the engagement of the Sub-Adviser by the Adviser.
NOW THEREFORE, in consideration of the promises and mutual covenants herein contained, it is agreed between the parties hereto as follows:
| 1. | Appointment. The Adviser hereby appoints the Sub-Adviser to act as investment
adviser, with full discretionary power and authority for the period and on the terms
set forth in this Agreement. The Sub-Adviser will be an independent contractor and
will have no authority to act for or represent the Trust or the Adviser except as
expressly authorized in this Agreement. The Sub-Adviser accepts such appointment
and agrees to furnish the services herein set forth, for the compensation herein
provided. |
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| 2. | Delivery of Documents. The Sub-Adviser acknowledges that it has received copies
of each of the following: |
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| a. | Each Fund’s Registration Statement on Form N-1A under the 1940 Act and under the Securities
Act, relating to shares of beneficial interest of the Fund(s) as filed with the
SEC and all amendments thereto; |
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| b. | Each Fund’s Prospectus (such Prospectus, as presently in effect and all amendments and
supplements thereto are herein called the “Prospectus”). |
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| c. | Each Fund’s’ Statement of Additional Information (such Statement of Additional Information,
as presently in effect and all amendments and supplements thereto are herein called
the “SAI”). |
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The Adviser will furnish the Sub-Adviser from time to time with copies, properly
certified or authenticated, of all amendments of or supplements to the foregoing
at the same time as such documents are required to be filed with the SEC. |
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| 3. |
Management. Subject to the supervision of the Trust’s Board of Trustees,
the Sub-Adviser will provide a continuous investment program for each Fund, including
investment research and management with respect to all securities, investments,
cash and cash equivalents in each Fund. The Sub-Adviser will determine from time
to time what securities and other investments will be purchased, retained or sold
by each Fund. The Sub-Adviser will provide the services under this Agreement in
accordance with each Fund’s investment objectives, policies and restrictions
as stated in its Prospectus and SAI and such compliance policies and procedures
as the Adviser or Trust may provide to Sub-Adviser in writing from time to time.
The Sub-Adviser further agrees that it: |
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| a. | Will conform
its activities to all applicable Rules and Regulations of the SEC and will, in addition,
conduct its activities under this Agreement in accordance with regulations of any
other Federal and State agencies which may now or in the future have jurisdiction
over its activities under this Agreement. |
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| b. | Will vote
proxies with respect to each Fund’s securities and exercise rights in corporate
actions or otherwise in accordance with the Sub-Adviser’s proxy voting guidelines
and shall report all votes cast in the in time, manner, and format requested to
facilitate the filing of the N-PX. |
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| c. | Will promptly
notify the Adviser of the occurrence of any event that would be reasonably likely
to disqualify the Sub-Adviser from serving as investment manager of an investment
company pursuant to Section 9(a) of the 1940 Act or otherwise. |
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| d. | Will promptly
notify the Adviser in the event that: (i) the Sub-Adviser becomes the subject of
an administrative proceeding or enforcement action by the SEC or other regulatory
body with applicable jurisdiction or (ii) to the best of the Sub-Adviser’s
knowledge, any affiliate of the Sub-Adviser becomes the subject of an administrative
proceeding or enforcement action by the SEC or other regulatory body with applicable
jurisdiction that the Sub-Adviser reasonably expects could have a material adverse
effect upon the ability of the Sub-Adviser to perform its duties under this Agreement. |
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| e. | Will provide,
at its own cost, personnel, office space, facilities and equipment necessary for
the conduct of its advisory activities on behalf of each Fund and will assume other
costs and expenses incurred by it in connection with its investment advisory services
pertaining to each Fund. |
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| f. | Will, in compliance
with the requirements of the 1940 Act, (i) maintain all records required to be maintained
and keep them as property of the Trust, (ii) surrender promptly to the Trust any
of such records upon the Trust’s request, and (iii) preserve for the periods
prescribed by the 1940 Act, and the rules or orders thereunder, the records required
to be maintained by the 0000 Xxx. |
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| g. | Will provide
the Trust and the Trust’s service providers with records concerning the Sub-Adviser’s activities which the Trust is required under applicable law or regulation
to maintain. |
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| h. | Will render
oral and written regular reports to the Trust and the Adviser concerning Sub-Adviser’s discharge of the foregoing responsibilities. |
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| 4. | Services Not Exclusive. The advisory services furnished by the Sub-Adviser hereunder
are not to be deemed exclusive, and the Sub-Adviser shall be free to furnish similar
services to others as long as its services under this Agreement are not impaired
thereby. |
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| 5. | Books and Records. In compliance with the requirements of Rule 31a-3 under
the 1940 Act, the Sub-Adviser hereby agrees that all records which it maintains
for the benefit of each Fund are the property of the Trust and further agrees to
surrender promptly to the Trust any of such records upon the Trust’s request.
The Sub-Adviser further agrees to preserve for the periods prescribed by it pursuant
to Rule 31a-2 under the 1940 Act the records required to be maintained by Rule 31a-1
under the 1940 Act that are not maintained by others on behalf of the Trust. |
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| 6. |
Compensation; Fund Expenses. For the services to be rendered by the Sub-Adviser
under this Agreement, the Adviser shall pay to the Sub-Adviser compensation at the
rate specified in Schedule B attached hereto and made a part of this Agreement.
Such compensation shall be payable monthly within fifteen (15) business days after
the end of any month to the Sub-Adviser and calculated by applying a daily rate,
based on the annual percentage rates as specified in the attached Schedule A, to
the assets. The fee shall be based on the average daily net assets for the month
involved. Fees for less than a full month will be pro-rated. The Sub-Adviser shall
have no right to obtain compensation directly from a Fund or the Trust for services
provided hereunder and agrees to look solely to the Adviser for payment of fees
due. During the term of this Agreement, the Sub-Adviser will pay all expenses incurred
by it in connection with its activities under this Agreement other than the cost
of securities, commodities and other investments (including brokerage commissions
and other transaction charges, if any) purchased for each Fund. |
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| 7. |
Limitation of Liability of the Sub-Adviser. The duties of the Sub-Adviser
shall be confined to those expressly set forth herein, and no implied duties are
assumed by or may be asserted against the Sub-Adviser hereunder. The Sub-Adviser
shall not be liable for any error of judgment or mistake of law or for any loss
suffered by the Trust (including, without limitation, any Fund thereof) or the Adviser
in connection with the performance of this Agreement, except a loss resulting from
a breach of fiduciary duty with respect to the receipt of compensation for services
or a loss resulting from willful misfeasance, bad faith or gross negligence on the
part of the Sub-Adviser in the performance of its duties or from reckless disregard
by it of its obligations and duties under this Agreement. In no case shall the Sub-Adviser
be liable for actions taken or non-actions with respect to the performance of services
under this Agreement based upon specific information, directions, instructions or
requests given or made to the Sub-Adviser by the Adviser or the Trust. The Adviser
shall indemnify the Sub-Adviser, its affiliates and its controlling persons, for
any liability and expenses, including reasonable attorneys’ fees, howsoever
arising from, or in connection with, the Sub-Adviser’s performance of its obligations
under this Agreement or the Adviser’s breach of the terms, representations
and warranties herein; provided, however, that the Sub-Adviser shall not be indemnified
for any liability or expenses that may be sustained as a result of the Sub-Adviser’s willful misfeasance, bad faith, or gross negligence in the performance of
the Sub-Adviser’s duties or by reason of the reckless disregard of the Sub-Adviser’s duties and obligations under this Agreement, which includes, but is not limited
to, liability that arises out of circumstances where the Sub-Adviser engages in
any conduct or omissions that could reasonably be expected to result in an enforcement
action taken against the Adviser and/or the Sub-Adviser by a regulatory agency or
authority. |
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| 8. | Duration and Termination. | |||
| a. | Duration.
This Agreement shall become effective on the date of its execution of the applicable
Schedule A with respect to each Fund (each an “Effective Date”). This
Agreement will terminate automatically, without the payment of any penalty, unless
within two years after its initial effectiveness and at least annually thereafter,
the continuance of the Agreement is specifically approved by (i) the Board or the
shareholders of the Fund by the affirmative vote of a majority of the outstanding
shares of the Fund, and (ii) a majority of the Independent Trustees, by vote cast
in person at a meeting called for the purpose of voting on such approval. 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 as provided herein,
Sub-Adviser may continue to serve hereunder in a manner |
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consistent with the 1940 Act and the rules thereunder. Upon termination of this Agreement,
the duties of the Adviser delegated to the Sub-Adviser under this Agreement automatically
shall revert to the Adviser. |
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| b. |
Termination by the Board or Shareholders. The Board, or pursuant to a vote of a majority
of the outstanding voting shares of the Fund, the Trust, on behalf of the Fund,
may at any time terminate this Agreement, without the payment of any penalty, by
providing sixty (60) days’ written notice delivered or mailed by registered
mail, postage prepaid, to Sub-Adviser. The Board may also terminate this Agreement
with for a material breach effective immediately or as of such time as the Board
deems appropriate. |
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| c. | Termination by Parties. | |||||
| i. | Adviser may
at any time terminate this Agreement, without the payment of any penalty, by providing
sixty (60) days’ advance written notice delivered or mailed by registered mail,
postage prepaid, to Sub-Adviser. |
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| ii. | Sub-Adviser
may terminate this Agreement effective on or after the second anniversary date of
this Agreement commencing on the Effective Date, without the payment of any penalty,
by providing at least six months advance written notice delivered or mailed by registered
mail, postage prepaid, to Adviser and the Trust on or before the second anniversary
date of this Agreement. |
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| iii. | Notwithstanding
the foregoing, in the event that: (i) the Adviser engages in any conduct that could
reasonably be expected to result in a material SEC enforcement action taken against
the Adviser, the Sub-Adviser may terminate this Agreement on sixty (60) days’
written notice to the Adviser; or (ii) any of the Fund’s Trustees, administrator,
transfer agent and/or fund accounting agent or any of their respective officers,
employees or affiliates who are directly involved with the Fund engage in any conduct
that could reasonably be expected to result in a material SEC enforcement action
taken against such person or entity and the Board or Adviser does not take prompt
action to terminate the relationship with such person or entity with respect to
the Fund, then the Sub-Adviser may terminate this Agreement on sixty (60) days’
written notice to the Adviser. |
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| d. |
Assignment. This Agreement will automatically terminate in the event of its assignment
(as that term is defined in the 1940 Act), or if the Adviser’s investment advisory
agreement shall terminate with respect to the Fund. |
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| e. |
No Prejudice and Transition. Any notice of termination served on Sub-Adviser by Adviser
shall be without prejudice to the obligation of Sub-Adviser to complete transactions
already initiated or acted upon with respect to the Fund. Upon termination with
or without proper notice as defined in this Agreement by Adviser Sub-Adviser will
be paid all reasonable expenses Sub-Adviser necessarily incurs in terminating the
Agreement. Upon termination of this Agreement, the duties of Adviser delegated to
Sub-Adviser under this Agreement automatically shall revert to Adviser. |
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| 9. | Notices. Except as otherwise provided in this Agreement, any notice or other
communication required by or permitted to be given in connection with this Agreement
will be in writing and will be delivered in person or sent by first class mail,
postage prepaid or by prepaid overnight delivery service to the respective parties
at the addresses noted below or such other addresses as may be provided by the parties
from time to time: |
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| If to the Adviser: | If to the Sub-Adviser | |||
| Mission Institutional Advisors, LLC | Auour Investments, LLC | |||
| 0000 Xxxxx Xxxxxxx Xxxxxx, Xxxxx 000 | 000 Xxxx Xxxxxx, Xxxxx 0 | |||
| Xxxxxx, XX 00000 | Xxxxxx, XX 00000 | |||
| Attn: Xxxxxxx Xxxxx | Attn: Xxxxxx Xxxxxx | |||
| With Copies to the Trust: | |
| 0000 Xxxxx Xxxxx Xxxxxxx, Xxxxx 000 | |
| Xxxxxxxx, Xxxxxxxx 00000 | |
| Attn: Xxxxx Xxxxxxx |
| 10. | Amendment
of this Agreement. No provision of this Agreement may be changed, waived, discharged
or terminated orally, but only by a written instrument signed by the party against
which enforcement of the change, waiver, discharge or termination is sought. No
material amendment of this Agreement shall be effective until approved by vote of
the holders of a majority of the Fund’s outstanding voting securities (as defined
in the 1940 Act). |
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| 11. | Miscellaneous. The captions of this Agreement are included for convenience of reference only
and in no way define or limit any of the provisions hereof or otherwise affect their
construction or effect. If any provision of this Agreement shall be held or made
invalid by a court decision, statute, rule or otherwise, the remainder of the Agreement
shall not be affected thereby. This Agreement shall be binding and shall inure to
the benefit of the parties hereto and their respective successors. |
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| 12. | The Name
“Auour.” Sub-Adviser agrees that the name “Auour” or variations
thereof may be used in the name of the Fund under this Agreement and that such name,
together with any related logos and any service marks containing the word “Auour” or variations thereof may be used in connection with the Fund’s business
only for so long as this Agreement (including any continuance or amendment hereof)
remains in effect and that such use shall be royalty free; provided, that in all
instances, Sub-Adviser shall be entitled to review and approve the actual use of
its xxxx by the Fund. At such time as this Agreement shall no longer be in effect,
the Fund will cease such use. The Fund acknowledges that it has no rights to the
name “Auour” or variations thereof and such logos or service marks other
than those granted in this paragraph and that the Sub-Adviser reserves to itself
the right to grant the nonexclusive right to use the name “Auour” or variations
thereof and such logos or service marks to any other person. |
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| 13. | Applicable
Law. This Agreement shall be construed in accordance with, and governed by,
the laws of the Commonwealth of Virginia, and the applicable provisions of the 1940
Act. To the extent that the applicable laws of the Commonwealth of Virginia, or
any of the provisions herein, conflict with the applicable provisions of the 1940
Act, the latter shall control. |
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| 14. | Entire
Agreement. This Agreement consists of the entire agreement of the parties with
respect to the subject matter hereof and supersedes all prior writings and understandings
relating thereto. |
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| 15. | Counterparts. This Agreement may be executed in two or more counterparts, each of which,
when so executed, shall be deemed to be an original, but such counterparts shall
together constitute but one and the same instrument. |
| * * * * * * * | ||
| Signature Page to Follow | ||
| * * * * * * * |
| SIGNATURE PAGE |
| TO THE SUB-ADVISORY AGREEMENT |
| BY AND BETWEEN |
| MISSION INSTITUTIONAL ADVISORS, LLC |
| AND |
| AUOUR INVESTMENTS, LLC |
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be executed by their officers designated below as of the day and year first above written.
MISSION INSTITUTIONAL ADVISORS, LLC
| By: /s/ Xxxxxxx X. Xxxxx | |
| Name: Xxxxxxx X. Xxxxx | |
| Title: President and Chief Operating Officer | |
| AUOUR INVESTMENTS, LLC | |
| By: /s/ Xxxxxx Xxxxxx | |
| Name: Xxxxxx Xxxxxx | |
| Title: Managing Principal |
| SCHEDULE A |
| TO THE SUB-ADVISORY AGREEMENT |
| BY AND BETWEEN |
| MISSION INSTITUTIONAL ADVISORS, LLC |
| AND |
| AUOUR INVESTMENTS, LLC |
Pursuant to paragraph 6 of the Sub-Advisory
Agreement by and between Mission Institutional Advisors, LLC (“Mission”)
and Auour Investments, LLC (“Auour”), Mission shall pay Auour the sub-advisory
fees with respect to each of each Fund of the World Funds Trust at the annualized
rates as set forth below |
| Fund | Asset Breakpoint | Sub-Advisory Fee | Effective Date |
| Mission-Auour Global Risk-Managed Equity Fund | None | 0.45% | December 28, 2017 |
IN WITNESS WHEREOF, the parties hereto have
caused this instrument to be signed on their behalf by their duly authorized officers
effective as of the Effective Date noted in the Schedule A above. |
| MISSION INSTITUTIONAL ADVISORS, LLC | AUOUR INVESTMENTS, LLC | |||||
| By: | /s/ Xxxxxxx X. Xxxxx | By: | /s/ Xxxxxx Xxxxxx | |||
| Name: | Xxxxxxx X. Xxxxx | Name: | Xxxxxx Xxxxxx | |||
| Title: | President and Chief Operating Officer | Title: | Managing Principal | |||
