Exhibit B
INVESTMENT SUB-ADVISORY AGREEMENT
AGREEMENT made as of this 29th day of June,
2007, by
and
between Nuveen Asset Management, a Delaware
corporation and a
registered investment adviser (Manager), and
Tradewinds Global
Investors LLC, a Delaware limited liability
company
and a
federally registered investment adviser (Sub
Adviser).
WHEREAS, Manager serves as the investment
manager for
the
Nuveen Multi-Strategy Income and Growth Fund 2,
formerly
known as Nuveen Preferred and Convertible
Income Fund
2 (the
Fund), a closed-end management investment
company
registered
under the Investment Company Act of 1940, as
amended
(the 0000
Xxx) pursuant to an Investment Management
Agreement
between
Manager and the Fund (as such agreement may be
modified from
time to time, the Management Agreement); and
WHEREAS, Manager desires to retain Sub-Adviser
as its
agent to furnish investment advisory services
for a
certain
designated portion of the Funds investment
portfolio,
upon the
terms and conditions hereafter set forth;
NOW, THEREFORE, in consideration of the mutual
covenants herein contained, the parties hereto
agree
as
follows:
1.Appointment. Manager hereby appoints Sub
Adviser
to
provide certain sub-investment advisory
services to
the
Fund for the period and on the terms set forth
in
this
Agreement. Sub-Adviser accepts such
appointment and
agrees to furnish the services herein set forth
for
the
compensation herein provided.
2 Services to be Performed. Subject always to
the
supervision of Funds Board of Trustees and the
Manager,
Sub-Adviser will furnish an investment program
in
respect
of, make investment decisions for, and place
all
orders for
the purchase and sale of securities for the
portion
of the
Funds investment portfolio allocated by Manager
to
Sub-
Adviser, all on behalf of the Fund and as
described
in the
investment policy section of the Funds initial
registration
statement on Form N-2 as declared effective by
the
Securities and Exchange Commission, as such
policies
described therein may subsequently be changed
by the
Funds Board of Trustees and publicly described.
In
the
performance of its duties, Sub-Adviser will
satisfy
its
fiduciary duties to the Fund, will monitor the
Funds
investments in securities selected for the Fund
by
the Sub-
Adviser hereunder, and will comply with the
provisions of
the Funds Declaration of Trust and By-laws, as
amended
from time to time, and the stated investment
objectives,
policies and restrictions of the Fund. Manager
will
provide
Sub-Adviser with current copies of the Funds
Declaration
of Trust, By-laws, prospectus and any
amendments
thereto,
and any objectives, policies or limitations not
appearing
therein as they may be relevant to Sub-Advisers
performance under this Agreement. Sub-Adviser
and
Manager will
each make its officers and employees available
to the
other
from time to time at reasonable times to review
investment
policies of the Fund and to consult with each
other
regarding the investment affairs of the Fund.
Sub Adviser
will report to the Board of Trustees and to
Manager
with
respect to the implementation of such program.
The Sub-Adviser will vote all proxies solicited
by or
with
respect to the issuers of securities which
assets of
the Funds
investment portfolio allocated by Manager to
Sub-
Adviser
are invested, consistent with its proxy voting
guidelines and
based upon the best interests of the Fund. The
Sub-
Adviser
will maintain appropriate records detailing its
voting of
proxies on behalf of the Fund and upon
reasonable
request will provide a report setting forth the
proposals
voted on and how the Funds shares were voted,
including
the name of the corresponding issuers.
Sub-Adviser is authorized to select the brokers
or
dealers
that will execute the purchases and sales of
portfolio
securities for the Fund, and is directed to use
its
commercially reasonable efforts to obtain best
execution,
which includes most favorable net results and
execution of
the Funds orders, taking into account all
appropriate
factors, including price, dealer spread or
commission, size
and difficulty of the transaction and research
or
other
services provided. It is understood that the
Sub
Adviser will not
be deemed to have acted unlawfully, or to have
breached a
fiduciary duty to the Fund, or be in breach of
any
obligation owing
to the Fund under this Agreement, or otherwise,
solely by reason of
its having caused the Fund to pay a member of a
securities
exchange, a broker or a dealer a commission for
effecting a
securities transaction for the Fund in excess
of the
amount of
commission another member of an exchange,
broker or
dealer
would have charged if the Sub-Adviser
determined in
good faith
that the commission paid was reasonable in
relation
to the
brokerage or research services provided by such
member, broker or
dealer, viewed in terms of that particular
transaction or the Sub-
Advisers overall responsibilities with respect
to
its accounts,
including the Fund, as to which it exercises
investment discretion.
In addition, if in the judgment of the Sub
Adviser,
the Fund would
be benefited by supplemental services, the Sub
Adviser is
authorized to pay spreads or commissions to
brokers
or dealers
furnishing such services in excess of spreads
or
commissions that
another broker or dealer may charge for the
same
transaction,
provided that the Sub-Adviser determined in
good
faith that the
commission or spread paid was reasonable in
relation
to the
services provided. The Sub-Adviser will
properly
communicate to
the officers and trustees of the Fund such
information relating to
transactions for the Fund as they may
reasonably
request. In no
instance will portfolio securities be purchased
from
or sold to the
Manager, Sub-Adviser or any affiliated person
of
either the Fund,
Manager, or Sub-Adviser, except as may be
permitted
under the
1940 Act;
Sub-Adviser further agrees that it will use the
same degree of skill and care in
providing such
services as it uses in providing services to
fiduciary accounts for which it
has investment responsibilities;
(b) will conform to all applicable Rules and
Regulations of the
Securities and Exchange Commission in all
material
respects and in
addition will conduct its activities under this
Agreement in accordance
with any applicable regulations of any
governmental
authority pertaining
to its investment advisory activities;
(c) will report regularly to Manager and to the
(d) Board of Trustees of the
Fund and will make appropriate persons
available for
the purpose of
reviewing with representatives of Manager and
the
Board of Trustees on a
regular basis at reasonable times the
management of
the Fund, including,
without limitation, review of the general
investment
strategies of the Fund
with respect to the portion of the Funds
portfolio
allocated to the Sub
Adviser, the performance of the Funds
investment
portfolio allocated to
the Sub-Adviser in relation to standard
industry
indices and general
conditions affecting the marketplace and will
provide
various other reports
from time to time as reasonably requested by
Manager;
(d) will monitor the pricing of portfolio
securities, and events relating
to the issuers of those securities and the
markets in
which the securities
trade in the ordinary course of managing the
portfolio securities of the
Fund, and will notify Manager promptly of any
issuer-
specific or market
events or other situations that occur
(particularly
those that may occur after
the close of a foreign market in which the
securities
may primarily trade
but before the time at which the Funds
securities are
priced on a given day)
that may materially impact the pricing of one
or more
securities in Sub-
Advisers portion of the portfolio. In
addition, Sub-
Adviser will assist
Manager in evaluating the impact that such an
event
may have on the net
asset value of the Fund and in determining a
recommended fair value of
the affected security or securities; and will
prepare
such books and records with respect to the
Funds
securities transactions for the portion of the
Funds
investment portfolio
allocated to the Sub-Adviser as requested by
the
Manager and will furnish
Manager and Funds Board of Trustees such
periodic and
special reports as
the Board or Manager may reasonably request.
3.Expenses. During the term of this Agreement,
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, if any) purchased for
the
Fund.
..Compensation. For the services provided and
the
expenses
assumed pursuant to this Agreement, Manager
will pay
the Sub-
Adviser, and the Sub-Adviser agrees to accept
as full
compensation
therefor, a portfolio management fee equal to
the
portion specified
below of the investment management fee payable
by the
Fund to
the Manager, pursuant to the Management
Agreement,
with respect
to the Sub-Advisers allocation of Fund net
assets
(including net
assets attributable to FundPreferred Shares and
the
principal
amount of any borrowings), as the net amount of
such
fee is
reduced by the obligation of Manager to
reimburse
certain fees and
expenses to the Fund pursuant to an Expense
Reimbursement
Agreement of even date herewith by and between
the
Fund and the
Manager, as such agreement may be modified from
time
to time:
Daily Net Assets
Percentage of Net Management Fee
Up to
$200 million
55.0%
$200 million to $300
million
52.5%
$300 million and over
50.0%
The portfolio management fee shall accrue on
each
calendar day,
and shall be payable monthly on the first
business
day of the next
succeeding calendar month. The daily fee
accrual
shall be
computed by multiplying the fraction of one
divided
by the number
of days in the calendar year by the applicable
annual
rate of fee,
and multiplying this product by the net assets
of the
Fund allocated
to the Sub-Advisor, determined in the manner
established by the
Funds Board of Trustees, as of the close of
business
on the last
preceding business day on which the Funds net
asset
value was
determined.
For the month and year in which this Agreement
becomes effective
or terminates, there shall be an appropriate
proration on the basis of
the number of days that the Agreement is in
effect
during the
month and year, respectively.
Manager shall not agree to amend the financial
terms
of the
Expense Reimbursement Agreement or the
Management
Agreement to the detriment of the Sub-Adviser
by
operation of this
Section 4 without the express written consent
of the
Sub-Adviser.
0.Xxxxxxxx to Others. Manager understands, and
has
advised Funds Board of Trustees, that Sub
Adviser now
acts, or
may in the future act, as an investment adviser
to
fiduciary and
other managed accounts, and as investment
adviser or
sub-
investment adviser to one or more other
investment
companies that
are not a series of the Fund, provided that
whenever
the Fund and
one or more other investment advisory clients
of Sub-
Adviser have
available funds for investment, investments
suitable
and
appropriate for each will be allocated in a
manner
believed by Sub-
Adviser to be equitable to each. Manager
recognizes,
and has
advised Funds Board of Trustees, that in some
cases
this procedure
may adversely affect the size of the position
that
the Fund may
obtain in a particular security. It is further
agreed that, on
occasions when the Sub-Adviser deems the
purchase or
sale of a
security to be in the best interests of the
Fund as
well as other
accounts, it may, to the extent permitted by
applicable law, but will
not be obligated to, aggregate the securities
to be
so sold or
purchased for the Fund with those to be sold or
purchased for other
accounts in order to obtain favorable execution
and
lower
brokerage commissions. In addition, Manager
understands, and
has advised Funds Board of Trustees, that the
persons
employed by
Sub-Adviser to assist in Sub-Advisers duties
under
this
Agreement will not devote their full such
efforts and
service to the
Fund. It is also agreed that the Sub-Adviser
may use
any
supplemental research obtained for the benefit
of the
Fund in
providing investment advice to its other
investment
advisory
accounts or for managing its own accounts.
6.Limitation of Liability. The Sub-Adviser
shall not
be liable for,
and Manager will not take any action against
the Sub-
Adviser to
hold Sub-Adviser liable for, any error of
judgment or
mistake of
law or for any loss suffered by the Fund
(including,
without
limitation, by reason of the purchase, sale or
retention of any
security) in connection with the performance of
the
Sub-Advisers
duties under this Agreement, except for a loss
resulting from
willful misfeasance, bad faith or gross
negligence on
the part of the
Sub-Adviser in the performance of its duties
under
this Agreement,
or by reason of its reckless disregard of its
obligations and duties
under this Agreement.
7.Term; Termination; Amendment. This Agreement
shall
become
effective with respect to the Fund on the same
date
as the
Management Agreement between the Fund and the
Manager
becomes effective, provided that it has been
approved
by a vote of
a majority of the outstanding voting securities
of
the Fund in
accordance with the requirements of the 1940
Act, and
shall
remain in full force until August 1, 2008
unless
sooner terminated
as hereinafter provided. This Agreement shall
continue in force
from year to year thereafter with respect to
the
Fund, but only as
long as such continuance is specifically
approved for
the Fund at
least annually in the manner required by the
1940 Act
and the rules
and regulations thereunder; provided, however,
that
if the
continuation of this Agreement is not approved
for
the Fund, the
Sub-Adviser may continue to serve in such
capacity
for the Fund in
the manner and to the extent permitted by the
1940
Act and the
rules and regulations thereunder.
This Agreement shall automatically terminate in
the
event of its
assignment and may be terminated at any time
without
the payment
of any penalty by the Manager on no less than
sixty
(60) days
written notice to the Sub-Adviser. This
Agreement
may also be
terminated by the Fund with respect to the Fund
by
action of the
Board of Trustees or by a vote of a majority of
the
outstanding
voting securities of such Fund on no less than
sixty
(60) days
written notice to the Sub-Adviser by the Fund.
This Agreement may be terminated with respect
to the
Fund at any
time without the payment of any penalty by the
Manager, the Board
of Trustees or by vote of a majority of the
outstanding voting
securities of the Fund in the event that it
shall
have been
established by a court of competent
jurisdiction that
the Sub-
Adviser or any officer or director of the Sub
Adviser
has taken any
action that results in a breach of the
covenants of
the Sub-Adviser
set forth herein.
The terms assignment and vote of a majority of
the
outstanding
voting securities shall have the meanings set
forth
in the 1940 Act
and the rules and regulations thereunder.
Termination of this Agreement shall not affect
the
right of the Sub-
Adviser to receive payments on any unpaid
balance of
the
compensation described in Section 4 earned
prior to
such
termination. This Agreement shall
automatically
terminate in the
event the Management Agreement between the
Manager
and the
Fund is terminated, assigned or not renewed.
8.Notice. Any notice under this Agreement
shall be
in writing,
addressed and delivered or mailed, postage
prepaid,
to the other
party
If to the Manager:If to the Sub-Adviser:
Nuveen Asset Management Tradewinds Global
Investors
000 Xxxx Xxxxxx Xxxxx 0000 Xxxxxxx Xxxx Xxxx
Xxxxxxx, Xxxxxxxx 00000 Xxx Xxxxxxx, XX 00000
Attention: Xxxx X. Xxxxxxx Attention: Mr.
Xxxxxxx
Xxxxxx
With a copy to:
Nuveen Investments
000 Xxxx Xxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: General Counsel
or such address as such party may designate for
the
receipt of such
notice.
9.Limitations on Liability. All parties hereto
are
expressly put on
notice of the Funds Agreement and Declaration
of
Trust and all
amendments thereto, a copy of which is on file
with
the Secretary
of the Commonwealth of Massachusetts, and the
limitation of
shareholder and trustee liability contained
therein.
The obligations
of the Fund entered in the name or on behalf
thereof
by any of the
Trustees, representatives or agents are made
not
individually but
only in such capacities and are not binding
upon any
of the
Trustees, officers, or shareholders of the Fund
individually but are
binding upon only the assets and property of
the
Fund, and persons
dealing with the Fund must look solely to the
assets
of the Fund
and those assets belonging to the subject Fund,
for
the enforcement
of any claims.
10.Miscellaneous. The captions in this
Agreement are
included for
convenience of reference only and in no way
define or
delimit any
of the provisions hereof or otherwise affect
their
construction or
effect. If any provision of this Agreement is
held or
made invalid
by a court decision, statute, rule or
otherwise, the
remainder of this
Agreement will not be affected thereby. This
Agreement will be
binding upon and shall inure to the benefit of
the
parties hereto and
their respective successors.
11.Applicable Law. This Agreement shall be
construed
in
accordance with applicable federal law and
(except as
to Section 9
hereof which shall be construed in accordance
with
the laws of
Massachusetts) the laws of the State of
Illinois.
IN WITNESS WHEREOF, the Manager and the Sub
Adviser have caused this Agreement to be
executed as
of
the day and year first above written.
NUVEEN ASSET MANAGEMENT, a Delaware corporation
By:
_/s/ Xxxxx X.
Antonatos_Title: Managing Director
TRADEWINDS GLOBAL INVESTORS LLC, a Delaware
limited
liability companyBy: _/s/
Xxxx X. Xxxxx Title: _Senior Vice President
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