INVESTMENT SUB-ADVISORY AGREEMENT
This Investment Sub-advisory Agreement ("Agreement") is made and entered
into as of December 17, 2004, by and between T2 Partners Management LP, a
Delaware limited partnership ("Advisor") and Centaur Capital Partners, L.P., a
Delaware limited partnership ("Sub-Advisor").
WHEREAS, the Advisor acts as the investment advisor to the Xxxxxx Dividend
Fund ("Fund"), a series of the Xxxxxx Investment Trust, a Delaware statutory
trust ("Trust") pursuant to that certain Investment Advisory Agreement, dated
December 17, 2004, between the Advisor and the Trust ("Advisory Agreement");
WHEREAS, the Trust is an open-end management investment company, registered
under the Investment Company Act of 1940, as amended (the "Act");
WHEREAS, each of the Advisor and Sub-Advisor is registered as an investment
advisor under the Investment Advisers Act of 1940, as amended ("Advisers Act"),
and engages in the business of asset management; and
WHEREAS, the Advisor, subject to the approval of the Board of Trustees of
the Trust ("Trustees"), desires to retain the Sub-Advisor to assist the Advisor
in rendering certain investment management services to the Fund, and the
Sub-Advisor is willing to render such services;
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
the parties hereto agree as follows:
1. Engagement and Obligations of Sub-Advisor. The Advisor hereby appoints
and retains the Sub-Advisor to act as a sub-advisor to the Advisor and to
provide the following services for the period and on the terms and conditions
set forth in this Agreement.
(a) Services. The Sub-Advisor agrees to perform the following services
(the "Services"):
(1) provide advice and recommendations to the Advisor regarding
the securities to be purchased, retained or sold with respect to the
Fund;
(2) provide advice and recommendations to the Advisor regarding
the selection of brokers and dealers to execute the purchase and/or
sale of portfolio securities for the Fund;
(3) provide the Advisor and the Trust with records concerning the
Sub-Advisor's activities under this Agreement which the Trust and the
Fund are required to maintain; and
(4) render regular reports to the Advisor and the Trustees
concerning the Sub-Advisor's discharge of the foregoing
responsibilities.
The Sub-Advisor shall discharge the foregoing responsibilities subject
to the control of the Trustees and officers of the Trust and in
compliance with (i) such policies as the Trustees may from time to time
establish; (ii) the Fund's objectives, policies, and limitations as set
forth in its prospectus ("Prospectus") and statement of additional
information ("Statement of Additional Information"), as the same may be
amended from time to time; and (iii) with all applicable laws and
regulations. All Services to be furnished by the Sub-Advisor under this
Agreement may be furnished through the medium of any directors,
officers or employees of the Sub-Advisor or through such other parties
as the Sub-Advisor may determine from time to time.
(b) Expenses and Personnel. The Sub-Advisor agrees, at its own
expense or at the expense of one or more of its affiliates, to render
the Services and to provide the office space, furnishings, equipment
and personnel as may be reasonably required to perform the Services on
the terms and for the compensation provided herein.
(c) Books and Records. All books and records prepared and
maintained by the Sub-Advisor for the Advisor and/or the Trust and the
Fund under this Agreement shall be the property of the Advisor and/or
the Trust and the Fund and, upon request therefor, the Sub-Advisor
shall surrender to the appropriate party such of the books and records
so requested.
2. Compensation of the Sub-Advisor. The Advisor will pay to the Sub-Advisor
an investment advisory fee (the "Fee") equal to an annualized rate of 0.75% of
the average daily net assets of the Fund, less certain marketing and operating
expenses borne by the Advisor, as agreed to between the Advisor and Sub-Advisor.
The Fee shall be calculated as of the last business day of each month based upon
the average daily net assets of the Fund determined in the manner described in
the Fund's Prospectus and/or Statement of Additional Information, and shall be
paid to the Sub-Advisor by the Advisor on a quarterly basis within a specified
period of time at the conclusion of each quarter as agreed to between the
Advisor and Sub-Advisor. The Sub-Advisor has also agreed to allow the Advisor to
withhold from the Fee up to one-half of the Advisor's expenses under that
certain Expense Limitation Agreement dated December 17, 2004, and any amendments
thereto, between the Advisor and the Trust with respect to the Fund, as agreed
to between the Advisor and Sub-Advisor. The Fund will not pay a direct fee to
the Sub-Advisor.
3. Status of Investment Sub-Advisor. The services of the Sub-Advisor to the
Advisor, the Trust and the Fund are not to be deemed exclusive, and the
Sub-Advisor shall be free to render similar services to others (including,
without limitation, any other registered investment management company, or
series thereof) so long as its Services to the Trust and the Fund are not
impaired thereby. The Sub-Advisor shall be deemed to be an independent
contractor and shall, unless otherwise expressly provided or authorized, have no
authority to act for or represent the Advisor, the Trust or the Fund in any way
or otherwise be deemed an agent of the Advisor, the Trust or the Fund. Nothing
in this Agreement shall limit or restrict the right of any director, officer or
employee of the Sub-Advisor, who may also be a trustee, officer or employee of
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the Advisor or the Trust, to engage in any other business or to devote his or
her time and attention in part to the management or other aspects of any other
business, whether of a similar nature or a dissimilar nature.
4. Permissible Interests. Trustees, agents, and stockholders of the Trust
and the Advisor are or may be interested in the Sub-Advisor (or any successor
thereof) as directors, partners, officers, or stockholders, or otherwise; and
directors, partners, officers, agents, and stockholders of the Sub-Advisor are
or may be interested in the Advisor or the Trust as trustees, directors,
officers, stockholders or otherwise; and the Sub-Advisor (or any successor) is
or may be interested in the Advisor or the Trust as a stockholder or otherwise.
5. Limits of Liability; Indemnification. The Sub-Advisor assumes no
responsibility under this Agreement other than to render the Services called for
hereunder. The Sub-Advisor shall not be liable for any error of judgment or for
any loss suffered by the Advisor, the Trust or the Fund in connection with the
matters to which this Agreement relates, except a loss resulting from a breach
of fiduciary duty with respect to receipt of compensation for services (in which
case any award of damages shall be limited to the period and the amount set
forth in Section 36(b)(3) of the Act) or a loss resulting from willful
misfeasance, bad faith or gross negligence on its part in the performance of, or
from reckless disregard by it of its obligations and duties under, this
Agreement. It is agreed that the Sub-Advisor shall have no responsibility or
liability for the accuracy or completeness of the Trust's registration statement
under the Act or the Securities Act of 1933, as amended ("1933 Act"), except for
information supplied by the Sub-Advisor for inclusion therein.
The Sub-Advisor will indemnify the Advisor and its directors, members,
partners, officers, employees and agents ("Advisor Parties") against and hold
the Advisor Parties harmless from any and all losses, claims, damages,
liabilities or expenses (including reasonable counsel fees and expenses) arising
from any claim, demand, action or suit which results from the Sub-Advisor
Parties' (as such term is defined immediately below) willful misfeasance, bad
faith, gross negligence or reckless disregard of the Sub-Advisor's obligations
and duties under this Agreement.
The Advisor will indemnify the Sub-Advisor and its directors, members,
partners, officers, employees and agents ("Sub-Advisor Parties") against and
hold the Sub-Advisor Parties harmless from any and all losses, claims, damages,
liabilities or expenses (including reasonable counsel fees and expenses) arising
from any claim, demand, action or suit which results from the Advisor Parties'
willful misfeasance, bad faith, gross negligence or reckless disregard of the
Advisor's obligations and duties under this Agreement.
6. Term. This Agreement shall remain in effect for an initial term of two
years from the date the Fund commences operations, and from year to year
thereafter provided such continuance is approved at least annually by the vote
of a majority of the trustees of the Trust who are not "interested persons" (as
defined in the Act) of the Trust, which vote must be cast in person at a meeting
called for the purpose of voting on such approval; provided, however, this
Agreement may be terminated at any time on at least 60 days prior written notice
to the Sub-Advisor, without the payment of any penalty, (i) by vote of the
Trustees or (ii) by vote of a majority of the outstanding voting securities (as
defined in the Act) of the Fund; and provided, further, that this Agreement may
be terminated at any time by the Advisor, on at least 60 days prior written
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notice to the Sub-Advisor, and subject to certain termination conditions as
agreed to between the Advisor and Sub-Advisor. The Sub-Advisor may terminate
this Agreement at any time, without the payment of any penalty, on at least 60
days prior written notice to the Advisor and the Trust. This Agreement will
automatically and immediately terminate in the event of its assignment (as
defined in the Act) or upon the termination of the Advisory Agreement.
7. Amendments. No provision of this Agreement may be changed, waived,
discharged or terminated orally, but only by an instrument in writing signed by
the party against which enforcement of the change, waiver, discharge or
termination is sought, and no amendment of this Agreement shall be effective
until approved by vote of the holders of a majority of the Trust's outstanding
voting securities.
8. Applicable Law. This Agreement shall be construed in accordance with,
and governed by, the substantive laws of the State of Delaware, without regard
to the principles of the conflict of laws or the choice of laws.
9. Representations and Warranties.
(a) Representations and Warranties of the Sub-Advisor. The Sub-Advisor
hereby represents and warrants to the Advisor and the Trust as follows: (i)
the Sub-Advisor is a limited partnership duly organized and in good
standing under the laws of the State of Delaware and is fully authorized to
enter into this Agreement and carry out its duties and obligations
hereunder; and (ii) the Sub-Advisor is registered as an investment advisor
with the Securities and Exchange Commission ("SEC") under the Advisers Act,
and shall maintain such registration in effect at all times during the term
of this Agreement.
(b) Representations and Warranties of the Advisor. The Advisor hereby
represents and warrants to the Sub-Advisor as follows: (i) the Advisor is a
limited partnership duly organized and in good standing under the laws of
the State of Delaware and is fully authorized to enter into this Agreement
and carry out its duties and obligations hereunder; and (ii) the Advisor is
registered as an investment advisor with the SEC under the Advisers Act,
and shall maintain such registration in effect at all times during the term
of this Agreement.
10. 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 and, to this extent, the provisions of
this Agreement shall be deemed to be severable.
11. Notice. Notices of any kind to be given to the Advisor hereunder by the
Sub-Advisor shall be in writing and shall be duly given if mailed or delivered
to T2 Partners Management LP, 000 Xxxx 00xx Xxxxxx, Xxxxx 0000, Xxx Xxxx, Xxx
Xxxx 00000, Attention: Xxxxxxx X. Xxxxxx or to such other address or to such
individual as shall be so specified by the Advisor to the Sub-Advisor. Notices
of any kind to be given to the Sub-Advisor hereunder by the Advisor shall be in
writing and shall be duly given if mailed or delivered to Centaur Capital
Partners, L.P., 000 Xxxxxxxx Xxxxx, Xxxxx 000, Xxxxxx, Xxxxx 00000, Attention:
Xxxx Xxxxxx, or at such other address or to such individual as shall be so
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specified by the Sub-Advisor to the Advisor. Notices of any kind to be given to
the Trust hereunder by the Sub-Advisor shall be in writing and shall be duly
given if mailed or delivered to the Xxxxxx Investment Trust at 000 Xxxx 00xx
Xxxxxx, Xxxxx 0000, Xxx Xxxx, Xxx Xxxx 00000, Attention Xxxx X. Xxxxxxx, with a
copy to The Nottingham Company at 000 Xxxxx Xxxxxxxx Xxxxxx, Post Xxxxxx Xxx 00,
Xxxxx Xxxxx, Xxxxx Xxxxxxxx 00000-0000, Attention: Xxxxxx X. Xxxxxxx or to such
other address or to such individual as shall be so specified by the Trust to the
Sub-Advisor. Notices shall be effective upon delivery.
12. Notice of Certain Changes in Sub-Advisor. The Sub-Advisor is hereby
obligated to notify the Trust and Advisor if there is a material change in the
Sub-Advisor's partnership, whether of general or limited partners, or senior
executive personnel, within a reasonable time after such change takes place.
13. Counterparts. This Agreement may be executed in any number of
counterpart signature pages (including facsimile counterparts), each of which
shall be deemed an original, and all of which, when taken together, shall
constitute one and the same instrument.
[Remainder of page left intentionally blank]
[Signature pages follow]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and the year first written above.
T2 PARTNERS MANGGEMENT LP CENTAUR CAPITAL PARTNERS, L.P.
/s/ Xxxxxxx X. Xxxxxx /s/ Xxxxxxx X. Xxxxxx
__________________________ ______________________________
By: Xxxxxxx X. Xxxxxx By: Xxxxxxx X. Xxxxxx
Title: Managing Partner Title: Managing Partner
The XXXXXX DIVIDEND FUND commenced operations on ___________, 200__.
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