SUB-ADVISORY AGREEMENT
This Sub-Advisory Agreement is made as
of the 19th day of
November, 2007, by and between The NCF Investment Department of New Covenant
Trust Company, N.A. (the “Adviser”) and Santa Xxxxxxx Asset Management, Inc., a
wholly owned subsidiary of Nuveen Investments (the “Sub-Adviser”).
WHEREAS, pursuant to an agreement dated
as of June 30th, 1999
(the “Advisory Agreement”) as amended and restated on May 14, 2001, the Adviser
serves as investment adviser to New Covenant Funds, a Delaware statutory 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;
and
WHEREAS, the Trust is comprised of four
separate investment portfolios, one of which is New Covenant Growth Fund (the
“Fund”); 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 a portfolio of securities to
assist the Adviser in performing services for a portion of the Fund;
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 desires to provide such services to the Trust and the
Adviser.
NOW, THEREFORE, in consideration of the
terms and conditions hereinafter set forth, it is agreed as
follows:
§1. Appointment of the
Sub-Adviser. The Adviser hereby appoints the Sub-Adviser to
provide a continuous investment program for that portion of the Fund designated
by the Adviser as assigned to the Sub-Adviser (the “Segment” of the Fund),
subject to such written instructions and supervision as the Adviser may from
time to time furnish. The Sub-Adviser hereby accepts such appointment
and agrees 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 with respect to the Segment in accordance with
the Fund’s investment objective, policies and applicable restrictions as stated
in the Fund’s 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 to the Sub-Adviser from time to time copies of all prospectuses and
Statements of Additional Information and of all amendments of, or supplements
to. Such Prospectuses and Statements of Additional Information and of all
resolutions of the Trust’s Board of Trustees applicable restrictions as stated
in the Fund’s 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 to the Sub-Adviser from time to time copies of all Prospectuses and
Statements of Additional Information and of all amendments of, or supplements
to, such Prospectuses and Statements of Additional Information and of all
resolutions of the Trust’s Board of Trustees applicable to the Sub-Adviser’s
services hereunder. 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 Fund or the Trust in any way.
§2. Sub-Advisory
Services. Subject to such written instructions and supervision
as the Adviser may from time to time furnish, the Sub-Adviser will provide an
investment program for the Segment, including investment research and management
with respect to securities and investments, including cash and cash equivalents
in the Segment, and will determine from time to time what securities and other
investments will be purchased, retained or sold by and within the
Segment. The Sub-Adviser will implement such determinations through
the placement, on behalf of the Fund, of orders for the execution of portfolio
transactions through such brokers or dealers as it may select. The
Adviser will instruct the Trust’s Custodian to forward promptly to the adviser
proxy and other materials relating to the exercise of such shareholder rights
and the Adviser will determine from time to time the manner in which voting
rights, rights to consent to corporate action and other rights pertaining to the
Fund’s investments should be exercised.
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In
fulfilling its responsibilities hereunder, the Sub-Adviser agrees that it
will:
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(a)
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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;
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(b)
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conform
with all applicable rules and regulations of the Unites States Securities
and Exchange Commission (“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 request from time to
time;
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(c)
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not
make loans to any person to purchase or carry shares of beneficial
interest in the Trust or make loans to the
Trust;
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(d)
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place
orders pursuant to investment determinations for the Fund either directly
with the issuer or with an underwriter, market maker or broker or
dealer. In placing orders, the Sub-Adviser will use its
reasonable best efforts to obtain best execution of such
orders. Consistent with this obligation, the Sub-Adviser may,
to the extent permitted by law, effect portfolio securities transactions
through brokers and dealer 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 Fund 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 cause the Fund 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 exercised investment
discretion. The Trust or the Adviser may, from time to time in
writing, direct the Sub-Adviser to place orders through one or more
brokers or dealers and, thereafter, the Sub-Adviser will have no
responsibility for ensuring best execution with respect to such
orders. In no instance will portfolio securities be purchased
from or sold to the Sub-Adviser or any affiliated person of the
Sub-Adviser as principal except as may be permitted by the 1940 act or an
exemption therefrom. If the Sub-Adviser determines in good
faith that the transaction is in the best interest of each client,
securities may be purchased on behalf of the Fund from, or sold on behalf
of the Fund to, another client of the Sub-Adviser in compliance with Rule
17a-7 under the 1940 Act;
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(e)
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maintain
all necessary or appropriate records with respect to the Fund’s securities
transactions for the Segment 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 and the Adviser such
periodic and special reports as the Board and Adviser reasonably may
request;
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(f)
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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 the performance of its
responsibilities and duties hereunder, except that subject to prompt
notification to the Trust and the Adviser, the Sub-Adviser may divulge
such information to its independent auditors and regulatory authorities,
or when so requested by the Adviser and the Trust; provided, however, that
nothing contained herein shall prohibit the Sub-Adviser from (1)
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 or (2) including the Adviser and Trust on its general list of disc
losable clients.
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(g)
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maintain
its policy and practice of conducting its fiduciary functions
independently. In making investment decisions for the Fund, the
Sub-Adviser’s personnel will not inquire or take into consideration
whether the issuers of securities proposed for purchase or sale for the
Fund’s account are customers of the Adviser, other sub-advisers, the
Sub-Adviser or of there respective parents, subsidiaries or
affiliates. In dealing with such customers, the Sub-Adviser and
its subsidiaries and affiliates will not inquire or take into
consideration whether securities of those customers are held by the Trust;
and
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(h)
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render,
upon request of the Adviser or the Trust’s Board of Trustees, written
reports concerning the investment activities of the Sub-Adviser with
respect to the Sub-Adviser’s Segment of the
Fund.
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§3. Expense. During
the term of this Agreement, the Sub-Adviser will pay all expenses incurred by it
in performing its services under this Agreement. The Sub-Adviser
shall not be liable for any expenses of the adviser or the Trust, including
without limitation (a) their interest and taxes, (b) brokerage commissions and
other costs in connection with the purchase or sale of securities or other
investment instruments with respect to the Fund and (c) custodian fees and
expenses.
§4. 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 Fund are the property of
the Fund 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.
§5. Compensation of the
Sub-Adviser.
(a) In
consideration of services rendered pursuant to this Agreement, the Adviser will
pay the Sub-Adviser a fee, in arrears, equal to an annual rate in accordance
with Schedule A hereto, paid quarterly.
(b) Such
fee for each calendar quarter shall be calculated based on the average of the
market value of the assets under management as of the end of each of the three
months in the quarter just ended, as provided by the Adviser.
(c) If
the Sub-Adviser should serve for less than the whole of any calendar quarter,
its compensation shall be determined as provided above on the basis of the
ending market value of the assets managed in the month in which the termination
occurs and shall be payable on a pro rata basis for the period of the calendar
quarter for which it has served as Sub-Adviser hereunder.
§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 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 may not be accomplished for
all clients of the Sub-Adviser at the same time or at the same
price.
§7. Use of Names. The Adviser
shall not use the name, logo, trade or service xxxx or derivative of the
foregoing of the Sub-Adviser or any of the Sub-Adviser’s affiliates in any
prospectus, sales literature or other materials whether or not relating to the
Trust in any manner not approved prior thereto by the Sub-Adviser; provided,
however, that the Sub-Adviser shall approve all uses of its or its affiliate’s
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
materials 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, including placing the Trust’s or
the Adviser’s name on the Sub-Adviser’s list of representative clients, 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.
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§8. Liability of the
Sub-Adviser. Absent willful misfeasance, bad faith, gross
negligence, or reckless disregard of obligations or duties hereunder on the part
of the Sub-Adviser, or loss resulting from breach of fiduciary duty, the
Sub-Adviser shall not be liable for any act or omission in the course of, or
connected with, rendering services hereunder or for any losses that may be
sustained in the purchase, holding or sale of any
security. Notwithstanding the foregoing, neither the Adviser nor the
Trust shall be deemed to have waived any rights it may have against the
Sub-Adviser under federal or state securities laws.
The Sub-Adviser shall indemnify and
hold harmless the Trust and the Adviser (and its affiliated companies and their
respective officers, directors and employees) from any and all claims, losses,
liabilities or damages (including reasonable attorney’s fees and other related
expenses) arising out of or in connection with the willful misfeasance, bad
faith, gross negligence, or reckless disregard of obligations or duties
including breach of fiduciary duty, hereunder of the Sub-Adviser.
The Adviser shall hold harmless and
indemnify the Sub-Adviser for any loss, liability, cost, damage or expense
(including reasonable attorney’s fees and costs) arising from any claim or
demand by any person that is based on (i) the obligations of any other
sub-adviser to the Fund, (ii) any obligation of the Adviser under the Advisory
Agreement or (iii) any matter for which the Sub-Adviser does not have liability
in accordance with the first sentence of this Section 8.
§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 Fund’s liability
set forth in its Trust Instrument and under Delaware law. The
Sub-Adviser agrees that any of the Trust’s obligations shall be limited to the
assets of the Fund and that the Sub-Adviser shall not seek satisfaction of any
such obligation from the shareholders of the Trust nor from any Trustee,
officer, employee or agent of the Trust.
The names “New Covenant Funds” and
“Trustees of New Covenant Funds” refer respectively to the Trust created and the
Trustees, as trustees but not individually or personally, acting from time to
time under the Trust Instrument dated as of September 30, 1998, to which
reference is hereby made and a copy of which is on file at the office of the
Secretary of State of the State of Delaware and elsewhere as required by law,
and to any and all amendments thereto so filed or hereafter
filed. The obligations of “New Covenant Funds” entered into in the
name or on behalf thereof, or in the name or on behalf of any series or class of
shares of the Trust, by any of the Trustees, representatives or agents are made
not individually, but in such capacities, and are not binding upon any of the
Trustees, shareholders or representatives of the Trust personally, but bind only
the assets of the trust, and all persons dealing with any series or class of
shares of the Trust must look solely to the assets of the Trust belonging to
such series or class for the enforcement of any claims against the
Trust.
§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 Trustees, including a majority of the disinterested Trustees
cast in person at a meeting called fro the purpose of voting on such approval,
and, unless sooner terminated as provided herein, shall continue in effect for
an initial period of one (1) year.
Thereafter, if not terminated, this
Agreement shall continue in effect with respect to the Fund for successive one
year periods provided such continuance is specifically approved at least
annually (a) by the vote of a majority of the disinterested Trustees 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 the
Fund. This Agreement may be terminated as to the Fund at any
time, without payment of any penalty, by the Trust’s Board of Trustees, by the
Adviser, or by a vote of a majority of the outstanding voting securities of the
Fund, upon 60 days’ prior written notice to the Sub-Adviser, or by the
Sub-Adviser upon 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.
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This Agreement shall terminate
automatically and immediately upon termination of the Advisory
Agreement. This Agreement shall terminate automatically and
immediately in the event of its assignment. No assignment of this
Agreement shall be made by the Sub-Adviser without the consent of the Adviser
and the Board of Trustees of the Trust.
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, if required by the 1940 act and applicable SEC rules and
regulations, a vote of a majority of the Fund’s outstanding voting
securities. Notwithstanding the foregoing, the Trust shall be under
no obligation to obtain shareholder approval to materially amend this Agreement
unless required to obtain such approval pursuant to any orders or rules and
regulations which may have been issued by the Securities and Exchange
Commission.
§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 as required or
permitted by this Agreement.
§12. Severability. If
any provision of this Agreement shall be held or made invalid by a court
decision, stature, rule or otherwise, the remainder of this Agreement shall not
be affected thereby.
§13. Miscellaneous. This
Agreement constitutes the full and complete agreement of the parties hereto with
respect to the subject matter hereof and each party agrees to perform such
further actions and execute such further documents as are necessary to
effectuate the purposes hereof. To the extent not preempted by
federal law, this Agreement shall be construed and enforced in accordance with
and governed by the laws of the State of Indiana. 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.
§14. Notices. All notices and
other communications hereunder shall be in writing (including telex or similar
writing) and shall be deemed given if delivered in person or by messenger,
cable, telegram or telex or facsimile transmission or by a reputable overnight
delivery service which provides evidence of receipt to the parties at the
following addresses or telex or facsimile transmission numbers (or at such other
address or number for a party as shall be specified by like
notice):
(a) if
to the Sub-Adviser, to:
Santa
Xxxxxxx Asset Management, Inc.
000 Xxxx
Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxx
Xxxxxxx, XX 00000
Facsimile
transmission number: (000) 000-0000
(b) if
to the Adviser, to:
The NCF
Investment Department of
New
Covenant Trust Company, N.A.
000 Xxxx
Xxxxxxx Xxxxxx, Xxxxx X
Xxxxxxxxxxxxxx,
XX 00000
Facsimile
transmission number: (000) 000-0000
Each such notice or other communication
shall be effective (i) if given by telex or facsimile transmission, when such
telex or facsimile is transmitted to the number specified in this section and
the appropriate answer back or confirmation is received, and (ii) if given by
any other means, when delivered at the address specified in this
section.
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IN WITNESS WHEREOF, the parties have
duly executed this Agreement as of the date first written above.
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THE
NCF INVESTMENT DEPARTMENT OF
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NEW
CONVENANT TRUST COMPANY, N.A.
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By:
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/s/Xxxxxx X. Xxx
III
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Name:
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Xxxxxx
X. Xxx III
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Title:
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Senior
Vice President, CIO
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SANTA
XXXXXXX ASSET MANAGEMENT, INC.
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By:
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/s/Xxxxxxx X.
Xxxxxxxx
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Name:
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Xxxxxxx
X. Xxxxxxxx
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Title:
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President,
CIO
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SCHEDULE
A
To the
Sub-Advisory Agreement between
The NCF
Investment Department of New Covenant Trust Company, N.A. and
Santa
Xxxxxxx Asset Management, Inc.
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Name
of Fund
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Compensation
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Date
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New
Covenant Growth Fund
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0.50%
annually
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November
19, 2007
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