INVESTMENT SUB-ADVISORY AGREEMENT First American Investment Funds, Inc. International Fund International Select Fund
First American Investment Funds, Inc.
International Fund
International Select Fund
International Fund
International Select Fund
THIS AGREEMENT is made as of the 1st day of January, 2011, between Nuveen Fund Advisors, Inc.,
a Delaware corporation (the “Advisor”) and Altrinsic Global Advisors, LLC, a Delaware limited
liability company (the “Sub-Advisor”).
WHEREAS, the Advisor acts as the investment advisor for International Fund and International
Select Fund (individually a “Fund” and together the “Funds”), each of which is a series of First
American Funds, Inc. (the “Company”), pursuant to an investment advisory agreement between the
Advisor and the Company (the “Advisory Agreement”).
WHEREAS, the Advisor is responsible for the day-to-day management of the Funds and for the
coordination of the investment of each Fund’s assets in portfolio securities.
WHEREAS, specific portfolio purchases and sales for all or a portion of a Fund’s assets may be
made by one or more sub-advisors selected and appointed by the Advisor, subject to the pre-approval
of the Board of Directors of the Company (the “Board”).
NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants contained
herein, the parties agree as follows:
1. Appointment of Sub-Advisor. The Advisor desires to engage and hereby appoints the
Sub-Advisor to act as investment sub-advisor for that portion of the assets of each Fund that the
Advisor determines to allocate to the Sub-Advisor from time to time (each referred to herein as a
“Sub-Advisory Portfolio”). The Sub-Advisor accepts the appointment and agrees to furnish the
services described herein for the compensation set forth below.
2. Duties of Sub-Advisor.
The Sub-Advisor is hereby employed and authorized to conduct a continual program of
investment, evaluation and, if appropriate, sale and reinvestment of the assets in each
Sub-Advisory Portfolio. In connection therewith, the Sub-Advisor will (a) make investment
decisions for each Sub-Advisory Portfolio; (b) place purchase and sale orders for portfolio
transactions in each Sub-Advisory Portfolio; and (c) employ professional portfolio managers and
securities analysts to provide research services relating to each Sub-Advisory Portfolio. Subject
to the supervision of the Board and the Advisor, the Sub-Advisor will manage the assets in each
Sub-Advisory Portfolio in accordance with (a) the respective Fund’s investment objective(s),
policies and restrictions stated in the
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Prospectus, the SAI and the Charter Documents (as such terms are defined below), (b) the
Guidelines (as such term is defined below), and (c) applicable laws and regulations. In managing a
Fund’s Sub-Advisory Portfolio, the Sub-Advisor will not consider any other securities, cash or
other investment such Fund owns. The duties of the Sub-Advisor with respect to each Sub-Advisory
Portfolio shall be confined to those set forth herein.
The Advisor has furnished to the Sub-Advisor the Funds’ compliance procedures pursuant to
Rules 10f-3, 17a-7, and 17e-1 under the Investment Company Act of 1940, as amended (the “1940 Act”)
(collectively, the “Compliance Procedures”), the Articles of Incorporation and Bylaws of the
Company, each as amended to date (the “Charter Documents”), the currently effective prospectus (the
“Prospectus”) and statement of additional information (the “SAI”) of each Fund, the resolution of
the Board approving the form of this Agreement, the resolution of the Board selecting the Advisor
as investment advisor to the Fund and approving the form of the Advisory Agreement, and the proxy
statement presented to shareholders of the Funds seeking their approval of this Agreement and the
Advisory Agreement. The Advisor agrees, on an ongoing basis, to provide to the Sub-Advisor, as
promptly as practicable, copies of all amendments and supplements to the Compliance Procedures,
each Fund’s Prospectus and SAI, and the Charter Documents. The Advisor has furnished to the
Sub-Advisor for each Fund all written guidelines (the “Guidelines”) setting forth additional
operating policies and procedures, including any limitations on the types of securities and other
investment products in which the Fund is permitted to invest or on investment activities in which
the Fund is permitted to engage. The Advisor retains the right, on prior written notice to the
Sub-Advisor, to modify the Guidelines at any time and in any manner. The Sub-Advisor shall either
comply with the amended Guidelines in accordance with a reasonable timeline agreed upon by the
Advisor and Sub-Advisor or terminate this Agreement in accordance with Section 11 below.
3. Brokerage. In selecting brokers or dealers to execute transactions on behalf of
the Funds, the Sub-Advisor will seek the best overall terms available. In assessing the best
overall terms available for any transaction, the Sub-Advisor will consider factors it deems
relevant, including, without limitation, 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, for the specific transaction and on a continuing basis.
In selecting brokers or dealers to execute a particular transaction, and in evaluating the best
overall terms available, the Sub-Advisor is authorized to consider brokerage and research services
(within the meaning of Section 28(e) of the Securities Exchange Act of 1934, as amended). The
Sub-Advisor will not execute any portfolio transactions with a broker or dealer which is an
“affiliated person” (as defined in the 0000 Xxx) of the Sub-Advisor or the Advisor, except pursuant
to the Board’s approved 17e-1 Policies and Procedures for affiliated brokerage transactions. The
Advisor will provide the Sub-Advisor with a list of brokers and dealers that are “affiliated
persons” of the Advisor.
4. Proxy Voting. The Sub-Advisor shall vote all proxies with respect to securities
held in the Sub-Advisory Portfolios in accordance with the Sub-Advisor’s
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proxy voting guidelines and procedures in effect from time to time. In the event material
changes are made to such proxy voting guidelines, the Sub-Advisor agrees to provide the Advisor
with a copy of the revised proxy voting guidelines. The Advisor agrees to instruct the Funds’
custodian to forward all proxy materials and related shareholder communications to the Sub-Advisor
promptly upon receipt. The Sub-Advisor agrees to promptly inform the Advisor and the respective
Fund of any conflict of interest of which the Sub-Advisor is aware that the Sub-Advisor has in
voting proxies with respect to securities held in such Fund’s Sub-Advisory Portfolio. The
Sub-Advisor shall not be liable with regard to voting of proxies or other corporate actions if the
proxy materials and related communications are not received in a timely manner.
5. Information Provided to the Advisor.
(a) The Sub-Advisor will keep the Advisor informed of developments materially affecting each
Fund and will, on its own initiative, furnish the Advisor from time to time with whatever
information the Sub-Advisor believes is appropriate for this purpose.
(b) The Sub-Advisor will confer with the Advisor as the Advisor may reasonably request
regarding the investment and management of the Sub-Advisory Portfolios. The Sub-Advisor will not
advise the Advisor or act for the Advisor or either Fund in any legal proceedings, including
bankruptcies or class actions, involving securities in the Sub-Advisory Portfolios or the issuers
of the securities.
(c) The Sub-Advisor agrees to comply with all reporting requirements that the Board or the
Advisor reasonably adopt and communicate to the Sub-Advisor in writing, including reporting
requirements related to performance of each Sub-Advisory Portfolio, brokerage practices, and proxy
voting.
(d) The Sub-Advisor agrees to furnish the information requested by the Advisor, consistent
with the Advisor’s duties and obligations under the Funds’ Pricing Procedures as currently existing
or hereafter modified, including, without limitation, advising the Advisor as soon as practicable
of any “significant event” (as defined in the Pricing Procedures) of which the Sub-Advisor becomes
aware relating to, or affecting the value of, any security or other asset held in a Sub-Advisory
Portfolio. A copy of the current Pricing Procedures has been provided to the Sub-advisor. The
Advisor agrees to notify the Sub-Advisor of any modification to the Pricing Procedures applicable
to the Sub-Advisor in a timely manner.
(e) The Sub-Advisor has provided the Advisor with a true and complete copy of its compliance
policies and procedures that are reasonably designed to prevent violations of the “federal
securities laws” (as such term is defined in Rule 38a-1 under the 0000 Xxx) and Rule 206(4)-7 under
the Investment Advisers Act of 1940, as amended (the “Advisers Act”) (the “Sub-Advisor Compliance
Policies”). The Sub-Advisor’s chief compliance officer (the “Sub-Advisor CCO”) shall provide to the
Company’s chief compliance officer (the “the Company CCO”) or his or her delegate, promptly (and in
no
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event more than 10 business days) after the occurrence of the triggering event, the following:
(i) a report of any material changes to the Sub-Advisor Compliance Policies;
(ii) a report of any “material compliance matters,” as defined by Rule 38a-1 under the 1940
Act, that have occurred in connection with the Sub-Advisor Compliance Policies;
(iii) a copy of a summary of the Sub-Advisor CCO’s report with respect to the annual review
of the Sub-Advisor Compliance Policies pursuant to Rule 206(4)-7 under the Advisers Act;
and
(iv) an annual (or more frequently as the Company CCO may request) certification regarding
the Sub-Advisor’s compliance with Rule 206(4)-7 under the Advisers Act and Section 38a-1
under the 1940 Act as well as the foregoing sub-paragraphs (i) - (iii).
(f) The Sub-Advisor will timely notify the Advisor of any material violations by the
Sub-Advisor of a Fund’s investment policies or restrictions, the Guidelines, or any applicable law
or regulation.
6. Standard of Care. The Sub-Advisor shall exercise its best judgment in rendering
the services described in paragraphs 2, 3 and 4 above. The Sub-Advisor shall not be liable for any
error of judgment or mistake of law or for any loss suffered by a Fund or the Advisor in connection
with the matters to which this Agreement relates, except a loss resulting from willful misfeasance,
bad faith or gross negligence on the Sub-Advisor’s part in the performance of its duties or from
reckless disregard by the Sub-Advisor of its obligations and duties under this Agreement (each such
act or omission shall be referred to as “Disqualifying Conduct”). Neither the Sub-Advisor nor its
members, partners, officers, employees and agents shall be liable to the Advisor, the Funds, their
shareholders or any other person (a) for the acts, omissions, errors of judgment or mistakes of law
of any other fiduciary or other person with respect to a Fund or (b) for any failure or delay in
performance of the Sub-Advisor’s obligations under this Agreement arising out of or caused,
directly or indirectly, by circumstances beyond its reasonable control, including, without
limitation, acts of civil or military authority, national emergencies, labor difficulties, fire,
mechanical breakdowns, flood or catastrophe, acts of God, insurrection, war, riots or failure of
the mails, transportation, communication or power supply.
The Sub-Advisor does not guarantee the future performance of either Sub-Advisory Portfolio or
any specific level of performance, the success of any investment decision or strategy that the
Sub-Advisor may use, or the success of the Sub-Advisor’s overall management of either Sub-Advisory
Portfolio. The Advisor understands that investment decisions made for the Funds by the Sub-Advisor
are subject to various
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market, currency, economic, political and business risks, and that those investment decisions will
not always be profitable.
7. Compensation. In consideration of the services rendered pursuant to this
Agreement, the Advisor will pay the Sub-Advisor on the fifth business day of each month a fee for
the previous month according to the attached Schedule A. The fee for the period from the
date of this Agreement to the end of the calendar month shall be prorated according to the
proportion that such period bears to the full monthly period. Upon any termination of this
Agreement before the end of a month, the fee for such part of that month shall be prorated
according to the proportion that such period bears to the full monthly period and shall be payable
upon the date of termination of this Agreement. For the purpose of determining fees payable to the
Sub-Advisor, the value of the net assets of a Sub-Advisory Portfolio shall be computed at the times
and in the manner specified in the respective Fund’s Prospectus and/or SAI.
8. Expenses. The Sub-Advisor will bear all of its expenses in connection with the
performance of its services under this Agreement. All other expenses to be incurred in the
operation of a Fund will be borne by such Fund, except to the extent specifically assumed by the
Sub-Advisor. The expenses to be borne by the Funds include, without limitation, the following:
organizational costs, taxes, interest, brokerage fees and commissions, directors’ fees, Securities
and Exchange Commission fees and state Blue Sky qualification fees, advisory fees, charges of
custodians, transfer and dividend disbursing agents’ fees, certain insurance premiums, outside
auditing and legal expenses, costs of independent pricing services, costs of maintaining existence,
costs attributable to investor services (including, without limitation, telephone and personnel
expenses), costs of preparing and printing prospectuses and SAIs for regulatory purposes and for
distribution to existing stockholders, costs of stockholders’ reports and meetings, and any
extraordinary expenses.
9. Services to Other Companies or Accounts. The Advisor understands that the
Sub-Advisor now acts, will continue to act and may act in the future as investment advisor to
fiduciary and other managed accounts and as investment advisor to other investment companies, and
the Advisor has no objection to the Sub-Advisor so acting, provided that whenever a Sub-Advisory
Portfolio and one or more other accounts or investment companies advised by the Sub-Advisor have
available funds for investment, investments suitable and appropriate for each will be allocated in
accordance with a methodology believed to be equitable to each entity. The Sub-Advisor agrees to
similarly allocate opportunities to sell securities. The Advisor recognizes that, in some cases,
this procedure may limit the size of the position that may be acquired or sold for a Fund. In
addition, the Advisor understands that the persons employed by the Sub-Advisor to assist in the
performance of the Sub-Advisor’s duties hereunder will not devote their full time to such service
and nothing contained herein shall be deemed to limit or restrict the right of the Sub-Advisor or
any affiliate of the Sub-Advisor to engage in and devote time and attention to other business or to
render services of whatever kind or nature.
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10. Books and Records. In compliance with the requirements of Rule 31a-3 under the
1940 Act, the Sub-Advisor hereby agrees that all records which it specifically maintains for a Fund
are the property of such Fund and further agrees to surrender promptly to such Fund copies of any
of such records upon such Fund’s or the Advisor’s request. The Sub-Advisor further agrees to
preserve for the periods prescribed by Rule 31a-2 under the 1940 Act the records relating to its
activities hereunder required to be maintained by Rule 31a-1 under the 1940 Act and to preserve the
records relating to its activities hereunder required by Rule 204-2 under the Advisers Act for the
period specified in said Rule.
11. Term of Agreement. This Agreement shall become effective as of the date of its
execution and shall continue in effect for a period of two years from the date of execution.
Thereafter, this Agreement shall continue automatically for successive annual periods, provided
such continuance is specifically approved at least annually by the Board in the manner required by
the 1940 Act. With respect to each Fund, this Agreement is terminable, without penalty, on 60 days’
written notice (the date of termination may be less than 60 days after the written notice of
termination so long as the duration of the notice period is agreed upon by the Board, the Advisor
and the Sub-Advisor) by the Advisor, by the Board, by vote of a majority of the applicable Fund’s
outstanding voting securities, or by the Sub-Advisor, and will immediately terminate upon
termination of the Advisory Agreement. This Agreement also will terminate automatically in the
event of its assignment (as defined in the 1940 Act).
12. Trade Settlement at Termination. Termination will be without prejudice to the
completion of any transaction already initiated. On, or after, the effective date of termination,
the Sub-Advisor shall be entitled, without prior notice to the Advisor or the Funds, to direct the
Funds’ custodian to retain and/or realize any assets of a Fund as may be required to settle
transactions already initiated with respect to that Fund. Following the date of effective
termination, any new transactions will only be executed by mutual agreement between the Advisor and
the Sub-Advisor.
13. Indemnification. (a) The Advisor agrees to indemnify and hold harmless the
Sub-Advisor and its members, partners, officers, employees, agents, successors and assigns (each a
“Sub-Advisor Indemnified Person”) from and against any and all claims, losses, liabilities or
damages (including reasonable attorneys’ fees and other related expenses) to which any Sub-Advisor
Indemnified Person may become subject as a result of the Advisor’s material breach of this
Agreement or as a result of the Advisor’s willful misfeasance, bad faith, gross negligence or
reckless disregard of its obligations and duties hereunder or violation of applicable law;
provided, however, that no Sub-Advisor Indemnified Person shall be indemnified for
any claim, loss, liability or damage that may be sustained as a result of the Sub-Advisor
Indemnified Person’s negligence.
(b) The Sub-Advisor agrees to indemnify and hold harmless the Advisor and the Funds and their
respective shareholders, members, partners, directors, officers, employees, agents, successors and
assigns (each an “Advisor Indemnified Person”) from and against any and all claims, losses,
liabilities or damages (including reasonable
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attorney’s fees and other related expenses) to which any Advisor Indemnified Person may become
subject as a result of the Sub-Advisor’s material breach of this Agreement or as a result of the
Sub-Advisor’s willful misfeasance, bad faith, gross negligence or reckless disregard of its
obligations and duties hereunder or violation of applicable law; provided, however,
that no Advisor Indemnified Person shall be indemnified for any claim, loss, liability or damage
that may be sustained as a result of the Advisor Indemnified Person’s negligence.
14. Delegation to Third Parties. Except where prohibited by applicable law or
regulation, the Sub-Advisor may delegate or may employ a third party to perform any accounting,
administrative, reporting and ancillary services required to enable the Sub-Advisor to perform its
functions under this Agreement. Notwithstanding any other provision of the Agreement, the
Sub-Advisor may provide information about the Advisor and the Funds to any such third party for the
purposes of this paragraph, provided that the third party is subject to a confidentiality agreement
that specifically prevents the misuse of any such information, including portfolio holdings. The
Sub-Advisor will act in good faith and with due diligence in the selection, use and monitoring of
third parties and shall be solely responsible for any loss, mistake, gross negligence or misconduct
caused by such third party.
15. Disclosure. (a) Neither the Advisor, on its own behalf or on behalf of the Funds,
or the Sub-Advisor shall disclose information of a confidential nature acquired in consequence of
this Agreement, except for information that they may be entitled or bound to disclose by law,
regulation or that is disclosed to their advisors where reasonably necessary for the performance of
their professional services or, in the case of the Sub-Advisor, as permitted in accordance with
Section 14 of this Agreement.
(b) Notwithstanding the provisions of Subsection 15(a), to the extent that any market
counterparty with whom the Sub-Advisor deals requires information relating to a Fund (including,
but not limited to, the identity of the Advisor or such Fund and market value of such Fund), the
Sub-Advisor shall be permitted to disclose such information to the extent necessary to effect
transactions on behalf of the Fund in accordance with the terms of this Agreement.
(c) Notwithstanding the provisions of Subsections 15(a) and 15(b), the Sub-Advisor
acknowledges that the Advisor and the Funds intend to rely on Rule 17a-7, Rule 17a-10, Rule 10f-3,
Rule 12d3-1 and Rule 17e-1 under the 1940 Act, and the Sub-Advisor hereby agrees that it (i) shall
not consult with any other Sub-Advisor to a Fund with respect to transactions in securities for
such Fund’s Sub-Advisory Portfolio or any other transactions of Fund assets and (ii) will provide
advice and otherwise perform services hereunder exclusively with respect to the Sub-Advisory
Portfolios of the Funds.
16. Instruction to Custodian. The Sub-Advisor shall not have control of the
investments or cash, including the investment of such cash, in either Fund but shall have authority
to issue to the Funds’ custodian such instructions as it may consider appropriate in connection
with the settlement of any transaction relating to a Fund’s Sub-Advisory
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Portfolio that it has initiated. In addition, the Funds’ custodian shall be responsible for
executing all foreign exchange transactions made or required to be made in conjunction with
settling the purchase and sale of securities in a Fund’s Sub-Advisory Portfolio. The Advisor shall
ensure that the Funds’ custodian is obliged to comply with any instructions of the Sub-Advisor
given in accordance with this Agreement. The Sub-Advisor will not be responsible for supervising
the Funds’ custodian.
17. Money Laundering. The Advisor, on its own behalf and on behalf of the Funds,
confirms that where it is acting as principal or where it is acting on behalf of another person
(notwithstanding that it enters into this Agreement and any transactions as principal), it is in
compliance with the anti-money laundering regulations that apply to it. The Advisor shall provide
any document or information to the Sub-Advisor that the Sub-Advisor may request for complying with
its own anti-money laundering regulations.
18. Representations and Warranties. (a) The Advisor represents and warrants to the
Sub-Advisor that the Advisor:
(i) has full power and authority to appoint the Sub-Advisor to manage the Funds in accordance
with the terms of this Agreement; and
(ii) this Agreement is valid and has been duly authorized by appropriate action of the
Advisor, the Board and each Fund’s shareholders, does not violate any obligation by which the
Advisor is bound, and when so executed and delivered, will be binding upon the Advisor in
accordance with its terms subject to applicable bankruptcy, insolvency, reorganization or similar
laws affecting creditors’ rights generally and general principles of equity.
(b) The Sub-Advisor represents and warrants to the Advisor that the Sub-Advisor:
(i) is registered as an “investment adviser” under the Advisers Act;
(ii) is not currently the subject of, and has not been the subject of during the last three
(3) years, any enforcement action by a regulator; and
(iii) maintains insurance coverage in an appropriate amount and shall upon request provide to
the Advisor any information it may reasonably require concerning the amount of or scope of such
insurance.
19. Miscellaneous.
(a) Notices. All notices provided for by this Agreement shall be in writing and shall
be deemed given when received, against appropriate receipt, by Xxxx Xxxx, Chief Investment Officer,
or Xxxxxxx Xxxx, Chief Operating Officer, in the case of the Sub-Advisor and the General Counsel of
the Advisor in the case of the Advisor, or such other person as a party shall designate by notice
to the other parties.
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(b) Amendment. This Agreement may be amended at any time, but only by written
agreement between the Advisor and the Sub-Advisor, which amendment must be approved by the Board in
the manner required by the 1940 Act.
(c) Entire Agreement. This Agreement constitutes the entire agreement among the
parties hereto and supersedes any prior agreement among the parties relating to the subject matter
hereof.
(d) Severability. If any provision of this Agreement will be held or made invalid by
a court decision, statute, rule or otherwise, the remainder of this Agreement will not be affected
thereby.
(e) Headings. The paragraph headings of this Agreement are for convenience of
reference and do not constitute a part hereof.
(f) Governing Law. This Agreement shall be governed in accordance with the internal
laws of the State of Delaware, without giving effect to principles of conflict of laws.
(g) Use of Sub-Advisor’s Name. Neither the Advisor, the Funds nor any affiliate of the
foregoing will use the Sub-Advisor’s name or the registered trademarks, service marks, logos, names
or any other proprietary designations of the Sub-Advisor, its subsidiaries and/or affiliates
(collectively, “Sub-Advisor Marks”) in any advertising or promotional material without the
Sub-Advisor’s prior written approval, which will not be unreasonably withheld. Notwithstanding the
foregoing, the Advisor may identify the Sub-Advisor as a sub-advisor to a Fund in any advertising
and promotional materials that contain a list of such Fund’s sub-advisors. The Advisor and the
Sub-Advisor will work together to develop mutually agreeable standards and procedures for the
review of materials bearing Sub-Advisor Marks to facilitate the efficient creation and use of such
advertising or promotional materials.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their
respective duly authorized representatives as of the date first written above.
| Nuveen Fund Advisors, Inc. |
|||||
| By: | |||||
| Name: | |||||
| Title: | |||||
| Altrinsic Global Advisors, LLC |
|||||
| By: | |||||
| Name: | |||||
| Title: | |||||
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Schedule A
Pursuant to Section 7, the Advisor shall pay the Sub-Advisor compensation for services
rendered to the Funds, calculated daily and paid monthly, at the annual rates set forth in the
following table. Such rates are based on the aggregate average daily net assets of the Sub-Advisory
Portfolios.
| Aggregate Assets of | |||||
| Sub-Advisory Portfolios | Fee Per Annum | ||||
First $150 million |
0.45 | % | |||
Next $350 million |
0.37 | % | |||
Over $500 million |
0.35 | % | |||
Schedule A - Page 1
