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EXHIBIT (5)(d)
SUB-INVESTMENT ADVISORY AGREEMENT
This Sub-Investment Advisory Agreement is made as of the 1st day of
January, 1998, by and between National Bank of Commerce, a national banking
association (the "Adviser"), and Xxxxxx Xxxxxxxx & Xxxxxxxx, LLP, a Pennsylvania
limited liability partnership (the "Sub-Adviser").
WHEREAS, the Adviser serves as investment adviser of certain portfolios
of The Sessions Group, an Ohio business trust and an open-end management
investment company (the "Trust"), which has filed a registration statement (the
"Registration Statement") under the Investment Company Act of 1940, as amended
(the "1940 Act") and the Securities Act of 1933.
WHEREAS, the Trust is comprised of several separate investment
portfolios, five of which currently are advised by the Adviser and are generally
known as the "First Market Funds;" and
WHEREAS, the Adviser desires to avail itself of the services,
information, advice, assistance and facilities of an investment adviser
experienced in the management of portfolio securities to assist the Adviser in
performing services for certain of the First Market Funds, all as now or
hereafter may be identified in Schedule A hereto (such existing investment
portfolios and any such additional investment portfolios as may be added to
Schedule A hereto from time to time are together called the "Funds"); and
WHEREAS, the Sub-Adviser represents that it has the legal power and
authority to perform the services contemplated hereunder without violation of
applicable law (including the Investment Advisers Act of 1940), and is engaged
in the business of rendering investment advisory services to investment
companies and desires to provide such services to the Trust and the Adviser; and
WHEREAS, the Sub-Adviser is familiar with the investment objectives,
policies and restrictions of the Funds and has reviewed the Investment Advisory
Agreement dated as of January 1, 1998, between the Adviser and the Trust (the
"Adviser Agreement").
NOW, THEREFORE, in consideration of the terms and conditions
hereinafter set forth, it is agreed as follows:
ss.1. Appointment of the Sub-Adviser. The Adviser hereby appoints the
Sub-Adviser to provide a continuous investment program for the Funds, subject to
such instructions and supervision as the Adviser may from time to time furnish
and further subject to the control and direction of the Trust's Board of
Trustees, for the period and on the terms hereinafter set forth. The Sub-Adviser
hereby accepts such appointment and
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agrees during such period to render the services and to assume the obligations
herein set forth for the compensation herein provided. The Sub-Adviser will
provide the services under this Agreement in accordance with the Funds'
investment objectives, policies and restrictions as stated in the Funds' most
recent Prospectus and Statement of Additional Information and as the same may,
from time to time, be supplemented or amended and in resolutions of the Trust's
Board of Trustees. The Adviser agrees to furnish the Sub-Adviser copies of all
amendments of or supplements to such Prospectus and Statement of Additional
Information within three business days of their filing with the United States
Securities and Exchange Commission ("SEC"). The Sub-Adviser shall for all
purposes herein be deemed to be an independent contractor and shall, except as
expressly provided or authorized (whether herein or otherwise), have no
authority to act for or represent the Adviser, the Funds or the Trust in any
way.
ss.2. Sub-Advisory Services. Subject to such instructions and
supervision as the Adviser may from time to time furnish, the continuous
investment program of the Funds provided by the Sub-Adviser shall include, among
other things, investment research and management with respect to all securities,
investments and cash equivalents in the Funds. The Sub-Adviser will determine
from time to time what securities and other investments will be purchased,
retained or sold by the Funds, the appropriate portion of each Fund's assets to
be invested in particular countries or geographic regions, the use of foreign
exchange contracts and other foreign currency matters, and the manner in which
voting rights, rights to consent to corporate action and other rights pertaining
to the Funds' investments should be exercised. The Sub-Adviser will implement
such determinations through the placement, in the name of the applicable Fund,
of orders for the execution of portfolio transactions with it through such
brokers or dealers as it may select.
In fulfilling its responsibilities hereunder, the Sub-Adviser agrees
that it will:
(a) use the same skill and care in providing such services as it
uses in providing services to other fiduciary accounts for
which it has investment responsibilities;
(b) conform with all applicable Rules and Regulations of the SEC
and in addition will conduct its activities under this
Agreement in accordance with any applicable regulations of any
government authority pertaining to the investment advisory
activities of the Sub-Adviser and shall furnish such written
reports or other documents substantiating such compliance as
the Adviser reasonably may from time to time request;
(c) place orders pursuant to investment determinations for the
Funds either directly with the issuer or with an
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underwriter, market maker or broker or dealer. In placing
orders with brokers and dealers, the Sub-Adviser will use its
reasonable best efforts to obtain prompt execution of orders
in an effective manner at the most favorable price. Consistent
with this obligation, the Sub-Adviser may, to the extent
permitted by law, purchase and sell portfolio securities to
and from brokers and dealers who provide brokerage and
research services (within the meaning of Section 28(e) of the
Securities Exchange Act of 1934) to or for the benefit of the
Funds and/or other accounts over which the Sub-Adviser
exercises investment discretion. Subject to the review of the
Trust's Board of Trustees from time to time with respect to
the extent and continuation of the policy, the Sub-Adviser is
authorized to pay a broker or dealer who provides such
brokerage and research services a commission for effecting a
securities 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 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
either that particular transaction or the overall
responsibilities of the Sub-Adviser with respect to the
accounts as to which it exercises investment discretion. In
placing orders with brokers and dealers, consistent with
applicable laws, rules and regulations, the Sub-Adviser may
consider the sale of shares of the Trust. In no instance will
portfolio securities be purchased from or sold to the Trust,
BISYS Fund Services Limited Partnership, the Adviser, any
other sub-investment adviser for the Trust ("other
sub-advisers"), or the Sub-Adviser or any affiliate of the
foregoing except as may be permitted by the 1940 Act, any
rules or regulations thereunder, or an exemption therefrom;
(d) maintain all necessary or appropriate books and records with
respect to the Funds' securities transactions in accordance
with all applicable laws, rules and regulations, including but
not limited to Section 31(a) of the 1940 Act and will furnish
the Trust's Board of Trustees such periodic and special
reports as the Board reasonably may request;
(e) treat confidentially and as proprietary information of the
Adviser and the Trust all records and other information
relative to the Adviser and the Trust and prior, present, or
potential shareholders, and will not use such records and
information for any purpose other than performance of its
responsibilities and duties hereunder, except that subject to
prompt notification
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to the Trust and the Adviser, the Sub-Adviser may divulge such
information to duly constituted authorities, or when so
requested by the Adviser and the Trust, provided, however,
that nothing contained herein shall prohibit the Sub-Adviser
from complying with applicable laws or regulations or
advertising or soliciting the public generally with respect to
other products or services, regardless of whether such
advertisement or solicitation may include prior, present or
potential shareholders of the Fund;
(f) maintain its policy and practice of conducting its fiduciary
functions independently. In making investment recommendations
for the Trust, the Sub- Adviser's personnel will not inquire
or take into consideration whether the issuers of securities
proposed for purchase or sale for the Trust's account are
customers of the Adviser, other sub-advisers, the Sub-Adviser
or of their respective parents, subsidiaries or affiliates. In
dealing with such customers, the Sub-Adviser and its parent,
subsidiaries, and affiliates will not inquire or take into
consideration whether securities of those customers are held
by the Trust; and
(g) render, upon request of the Adviser or the Trust's Board of
Trustees, written reports concerning the investment activities
of the Funds.
ss.3. Expenses. 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 (including brokerage
commissions and taxes, if any) purchased for the Funds.
ss.4. Books and Records. In compliance with the requirements of Rule
31a-3 under the 1940 Act, the Sub-Adviser hereby agrees that all records, if
any, which it maintains for the Funds are the property of the Funds and further
agrees to surrender promptly to the Adviser or the Trust any such records upon
the Adviser's or the Trust's request and that such records shall be available
for inspection by the SEC. The Sub-Adviser further agrees to preserve for the
periods and at the places prescribed by Rule 31a-2 under the 1940 Act the
records required to be maintained by Rule 31a-1 under the 1940 Act.
ss.5. Compensation of the Sub-Adviser. In consideration of services
rendered pursuant to this Agreement, the Adviser will pay the Sub-Adviser a fee
at the annual rate of the value of each Fund's average daily net assets set
forth in Schedule A hereto; provided, however, that the Sub-Adviser may from
time to time waive some or all of such fees until such time as it notifies the
Trust that it has terminated such waiver. Such fee shall be accrued daily and
paid monthly as soon as practicable after the
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end of each month. If the Sub-Adviser shall serve for less than the whole of any
month, the foregoing compensation shall be prorated. For the purpose of
determining fees payable to the Sub-Adviser, the value of the Funds' net assets
shall be computed at the times and in the manner specified in the Trust's
Registration Statement. Notwithstanding anything contained herein to the
contrary, the Sub-Adviser shall not be compensated on the basis of a share of
capital gains or upon capital appreciation of any Fund or any portion thereof
except as may be authorized by applicable law.
ss.6. Services Not Exclusive. The services of the Sub-Adviser hereunder
are not to be deemed exclusive, and the Sub-Adviser shall be free to render
similar services to others, including others who may invest in the same
securities as the Funds, and to engage in other activities, so long as the
services rendered hereunder are not impaired. It is understood that the action
taken by the Sub-Adviser under this Agreement may differ from the advice given
or the timing or nature of action taken with respect to other clients of the
Sub-Adviser, and that a transaction in a specific security may not be
accomplished for all clients of the Sub-Adviser at the same time or at the same
price.
ss.7. Use of Names. The Adviser shall not use the name of the
Sub-Adviser in any prospectus, sales literature or other material relating to
the Trust in any manner not approved prior thereto in writing by the
Sub-Adviser; provided, however, that the Sub-Adviser shall approve all uses of
its name which merely refer in accurate terms to its appointment hereunder or
which are required by the SEC or a state securities commission; and, provided
further, that in no event shall such approval be unreasonably withheld. The
Sub-Adviser shall not use the name of the Trust, the Fund or the Adviser in any
material relating to the Sub-Adviser in any manner not approved prior thereto by
the Adviser; provided, however, that the Adviser shall approve all uses of its
and the Fund's or the Trust's name which merely refer in accurate terms to the
appointment of the Sub-Adviser hereunder or which are required by the SEC or a
state securities commission; and, provided further, that in no event shall such
approval be unreasonably withheld.
ss.8. Liability of the Sub-Adviser; Indemnification. (a) The
Sub-Adviser may rely on information believed by it to be accurate and reliable.
Neither the Sub-Adviser nor its officers, directors, employees, agents or
controlling persons (as defined in the 0000 Xxx) shall be subject to any
liability for any act or omission, error of judgment or mistake of law, or for
any loss suffered by the Trust or a Fund, in the course of, connected with or
arising out of any services to be rendered hereunder, except by reason of wilful
misfeasance, bad faith or gross negligence on the part of the Sub-Adviser in the
performance of its duties or by reason of reckless disregard on the part of the
Sub-Adviser of its obligations and duties under this Agreement. Any person,
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even though also employed by the Sub-Adviser shall be deemed, when acting within
the scope of his employment by the Trust, to be acting in such employment solely
for the Trust and not as an employee or agent of the Sub-Adviser.
(b) The Adviser agrees to indemnify and hold harmless the Sub-Adviser,
and each of its affiliates, agents, directors, officers and employees (each of
the foregoing being hereinafter referred to as a "Sub-Adviser Indemnified
Person") from and against any and all losses, liabilities, judgments,
settlements, claims, damages and expenses whatsoever, including, without
limitation, all expenses, including attorneys' fees and disbursements,
reasonably incurred in connection with the investigation of, the preparation
for, or the defense of any claim, action, investigation or proceeding
(collectively, "Losses"), whether or not instituted or resulting in liability
and whether or not any Sub-Adviser Indemnified Person is named as a party
thereto, as and when incurred by any Sub-Adviser Indemnified Person, arising out
of, relating to or incurred in connection with:
(i) any violation or alleged violation of any law, rule or regulation
or any judgment, order or decree caused by any action taken or omitted
to be taken by the Adviser or any of its affiliates in connection with
the performance by the Adviser of the obligations arising out of this
Agreement; and
(ii) any breach or alleged breach by the Adviser or any of its
affiliates of any of their respective obligations, representations,
warranties or agreements contained herein.
(c) The Sub-Adviser agrees to indemnify and hold harmless the Adviser,
and each of its affiliates, agents, directors, officers and employees (each of
the foregoing being hereinafter referred to as an "Adviser Indemnified Person")
from and against any and all Losses, whether or not instituted or resulting in
liability and whether or not any Adviser Indemnified Person is named as a party
thereto, as and when incurred by any Adviser Indemnified Person, arising out of,
relating to or incurred in connection with:
(i) any violation or alleged violation of any law, rule or regulation
or any judgment, order or decree caused by any action taken or omitted
to be taken by the Sub-Adviser or any of its affiliates in connection
with the performance by the Sub-Adviser of the obligations arising out
of this Agreement; and
(ii) any breach or alleged breach by the Sub-Adviser or any of its
affiliates of any of their respective obligations, representations,
warranties or agreements contained herein.
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(d) Each person entitled to indemnification under Subsections (b) or (c) above
(an "indemnified party") shall give prompt notice to each person responsible for
indemnifying such indemnified party (an "indemnifying party") of any action
commenced against it in respect of which indemnify may be sought hereunder, but
failure to so notify an indemnifying party shall not relieve such indemnifying
party from any liability that it may have otherwise than on account of this
Section. An indemnifying party, upon request of the indemnified party, shall
retain counsel reasonably satisfactory to the indemnified party to represent the
indemnified party and any others the indemnifying party may designate in such
proceeding and shall pay the fees and disbursements of such counsel related to
such proceeding. In any such proceeding, any indemnified party shall have the
right to retain its own counsel, but the fees and expenses of such counsel shall
be at the expense of such indemnified party unless (i) the indemnifying party
and the indemnified party shall have mutually agreed to the retention of such
counsel or (ii) the named parties to any such proceeding (including any
impleaded parties) include both the indemnifying party and the indemnified party
and representation of both parties by the same counsel would be inappropriate
due to actual or potential differing interests between them. It is understood
that the indemnifying party shall not, in connection with any proceeding or
related proceedings in the same jurisdiction, be liable for the fees and
expenses of more than one separate firm (in addition to any local counsel) for
the indemnified parities, and that all such fees and expenses shall be
reimbursed as they are incurred. In the case of any such separate firm for an
Adviser Indemnified Person, such firm shall be designated in writing by the
Adviser. In the case of any such separate firm for a Sub-Adviser Indemnified
Person, such firm shall be designated in writing by the Sub-Adviser. The
indemnifying party shall not be liable for any settlement of any proceeding
effected without its written consent, but if settled with such consent or if
there be a final judgment for the plaintiff, the indemnifying party agrees to
indemnify the indemnified party from and against any Losses by reason of such
settlement or judgment. No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending or
threatened proceeding in respect of which any indemnified party is or could have
been a party and indemnity could have been sought hereunder by such indemnified
party, unless such settlement includes an unconditional release of such
indemnified party from all liability on claims that are the subject matter of
such proceedings.
ss.9. Limitation of Trust's Liability. The Sub-Adviser acknowledges
that it has received notice of and accepts the limitations upon the Trust's and
the Funds' liability set forth in its Declaration of Trust and under Ohio law.
The Sub-Adviser agrees that any of the Trust's obligations shall be limited to
the assets of the Funds and that the Sub-Adviser shall not seek satisfaction of
any such obligation from the shareholders of the
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Trust nor from any Trustee, officer, employee or agent of the Trust.
The Sessions Group is a business trust organized under Chapter 1746,
Ohio Revised Code and under a Declaration of Trust, to which reference is hereby
made and a copy of which is on file at the office of the Secretary of State of
Ohio as required by law, and to any and all amendments thereto so filed or
hereafter filed. The obligations of "The Sessions Group" entered into in the
name or on behalf thereof by any of the Trustees, officers, employees or agents
are made not individually, but in such capacities, and are not binding upon any
of the Trustees, officers, employees, agents or shareholders of the Trust
personally, but bind only the assets of the Trust, as set forth in Section
1746.13(A), Ohio Revised Code, and all persons dealing with any of the Funds of
the Trust must look solely to the assets of the Trust belonging to such Fund for
the enforcement of any claims against the Trust.
ss.10. Duration, Renewal, Termination and Amendment. This Agreement
will become effective as of the date first written above, provided that it shall
have been approved by vote of a majority of the outstanding voting securities of
each Fund, in accordance with the requirements under the 1940 Act, and, unless
sooner terminated as provided herein, shall continue in effect until January 1,
2000.
Thereafter, if not terminated, this Agreement shall continue in effect
with respect to a Fund for successive periods of one year each ending on
December 31st of each year, provided such continuance is specifically approved
with respect to a Fund at least annually (a) by the vote of a majority of those
members of the Trust's Board of Trustees who are not parties to this Agreement
or interested persons of any party to this Agreement, cast in person at a
meeting called for the purpose of voting on such approval, and (b) by the vote
of a majority of the Trust's Board of Trustees or by the vote of a majority of
all votes attributable to the outstanding Shares of that Fund. This Agreement
may be terminated as to a Fund at any time, without payment of any penalty, by
the Trust's Board of Trustees, by the Adviser, or by a vote of the majority of
the outstanding voting securities of that Fund upon, at least 60 days' prior
written notice to the Sub-Adviser, or by the Sub-Adviser upon at least 60 days'
prior written notice to the Adviser and the Trust's Board of Trustees, or upon
such shorter notice as may be mutually agreed upon. This Agreement shall
terminate automatically and immediately upon termination of the Adviser
Agreement. This Agreement shall terminate automatically and immediately in the
event of its assignment. The terms "assignment" and "vote of a majority of the
outstanding voting securities" shall have the meaning set forth for such terms
in the 1940 Act. This Agreement may be amended at any time by the Adviser and
the Sub-Adviser, subject to approval by the Trust's Board of Trustees and by a
majority of the Trust's Board of Trustees who are not "interested
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persons" of the Trust, cast in person at a meeting called for the purpose of
voting on such approval, and, if required by the 1940 Act and applicable SEC
rules and regulations, a vote of a majority of the applicable Fund's outstanding
voting securities.
ss.11. Confidential Relationship. Any information and advice furnished
by either party to this Agreement to the other shall be treated as confidential
and shall not be disclosed to third parties except as required by law or by this
Agreement.
ss.12. Severability. If any provision of this Agreement shall be held
or made invalid by a court decision, statute, rule or otherwise, the remainder
of this Agreement shall not be affected thereby.
ss.13. Miscellaneous. This Agreement constitutes the full and complete
agreement of the parties hereto with respect to the subject matter hereof. Each
party agrees to perform such further actions and execute such further documents
as are necessary to effectuate the purposes hereof. This Agreement shall be
construed and enforced in accordance with and governed by the laws of the State
of New York, provided that nothing herein shall be construed as being
inconsistent with the 1940 Act. The captions in this Agreement are included for
convenience only and in no way define or delimit any of the provisions hereof or
otherwise affect their construction or effect. This Agreement may be executed in
several counterparts, all of which together shall for all purposes constitute
one Agreement, binding on all parties.
ss.14. Potential Conflicts of Interest. (a) Subject to applicable
statutes and regulations, it is understood that trustees, officers or agents of
the Trust are or may be interested in the Sub-Adviser or its affiliates as
directors, officers, employees, agents, shareholders or otherwise, and that the
directors, officers, employees, agents or shareholders of the Sub-Adviser or its
affiliates may be interested in the Trust, as trustees, officers, agents or
otherwise.
(b) If the Sub-Adviser considers the purchase or sale of securities for
a Fund and other advisory clients of the Sub-Adviser at or about the same time,
transactions in such securities will be allocated among such Fund and such other
clients in a manner deemed fair and reasonable by the Sub-Adviser, subject to
any guidelines that may be adopted by the Board of Trustees of the Trust.
ss.15. Notices. Any communication hereunder shall be in writing and
shall be delivered in person or by telex or facsimile (followed by mailing such
written communication, air mail postage prepaid, on the date on which such telex
or facsimile is sent, to the address set forth below). Any communication or
document to be made or delivered by one person to another pursuant to this
Agreement shall be made or delivered to that other person at the
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following relevant address (unless that other person has by fifteen (15) days'
notice to the other specified another address):
If to the Sub-Adviser:
Xxxxxx Xxxxxxx Asset Management Inc.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: General Counsel
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
Telex No.: (000) 000-0000
If to the Adviser:
National Bank of Commerce
Xxx Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxx 00000
Attention:___________________
Telephone No.: (901)_________
Facsimile No.: ______________
Communications or documents made or delivered by personal delivery shall be
deemed to have been received on the day of such delivery. Communications or
documents made or delivered by telex or facsimile shall be deemed to have been
received, if by telex, when acknowledged by the addressee's correct answer back
code and, if by facsimile, upon production of a transmission report by the
machine from which the facsimile was sent which indicates that the facsimile was
sent in its entirety to the facsimile number of the recipient; provided that a
hard copy of the communication or document so made or delivered by telex or
facsimile was posted the same day as the communication or document was made or
delivered by electronic means.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of
the date first written above.
NATIONAL BANK OF COMMERCE XXXXXX XXXXXXXX & XXXXXXXX, LLP
By Xxxxxx Xxxxxxx Asset Man-
agement Holdings, Inc.,
its General Partner
By By
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Title Title
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Dated: January 1, 1998
SCHEDULE A
To the Sub-Investment Advisory Agreement
between National Bank of Commerce and
Xxxxxx Xxxxxxxx & Xxxxxxxx, LLP
Name of Fund COMPENSATION* DATE
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First Market Value Annual rate of 0.625% of the January 1, 1998
Equity Fund average daily net assets of
such Fund up to $20 million,
0.50% of the average daily
net assets of such Fund from
$20 million up to $30 million,
and 0.375% of the average
daily net assets of such Fund
from $30 million to $35 million.
If the average daily net assets
of such Fund equal or exceed $35
million, the annual rate of
0.56% of the average daily net
assets of such Fund.
First Market Fixed Annual Rate of 0.50% of the January 1, 1998
Income Fund average daily net assets of
such Fund up to $25 million
and 0.25% of the average
daily net assets of such Fund
from $25 million to $75 million.
If the average daily net assets
of such Fund equal or exceed $75
million, the annual rate of
0.33% of the average daily net
assets of such Fund.
XXXXXX XXXXXXXX & XXXXXXXX, LLP NATIONAL BANK OF COMMERCE
By Xxxxxx Xxxxxxx Asset
Management Holdings, Inc., its
General Partner
By By
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Title Title
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*All fees are computed daily and paid monthly.
