EXHIBIT (d)(20)
FORWARD FUNDS
INVESTMENT SUB-ADVISORY AGREEMENT
This INVESTMENT SUB-ADVISORY AGREEMENT ("Agreement") effective as of September
1, 2008, is by and among Pacific Investment Management Company LLC (the
"Sub-Advisor"), Forward Funds (the "Trust"), on behalf of the Accessor
Intermediate Fixed-Income Fund, a series of the Trust (the "Fund"), and Forward
Management, LLC (the "Advisor").
WHEREAS, the Trust is a Delaware statutory trust of the series type organized
under an Amended and Restated Declaration of Trust dated as of June 9, 2005, as
amended, and is registered under the Investment Company Act of 1940, as amended
(the "1940 Act"), as an open-end, diversified management investment company, and
the Fund is a series of the Trust; and
WHEREAS, the Advisor has been retained by the Trust to provide investment
advisory services to the Fund with regard to the Fund's investments, as further
described in the Trust's registration statement on Form N-1A (the "Registration
Statement") and pursuant to an Amended and Restated Investment Management
Agreement dated as of July 1, 2005, as amended ("Investment Management
Agreement"); and
WHEREAS, the Trust's Board of Trustees (the "Trustees"), including a majority of
the Trustees who are not "interested persons" as defined in the 1940 Act, and
the Fund's shareholders to the extent required under applicable law and
regulation have approved the appointment of the Sub-Advisor to perform certain
investment advisory services for the Trust, on behalf of the Fund, pursuant to
this Agreement and as described in the Registration Statement, and the
Sub-Advisor is willing to perform such services for the Fund; and
WHEREAS, the Sub-Advisor is registered as an investment adviser under the
Investment Advisers Act of 1940, as amended (the "Advisers Act").
NOW THEREFORE, in consideration of the promises and mutual covenants herein
contained, it is agreed among the Advisor, the Trust and the Sub-Advisor as
follows:
1. Appointment. The Trust and the Advisor hereby appoint the Sub-Advisor to
perform advisory services to the Fund for the periods and on the terms set forth
in this Agreement. The Sub-Advisor accepts such appointment and agrees to
furnish the services herein set forth, for the compensation herein provided.
2. Investment Advisory Duties. Subject to the supervision of the Trustees and
the Advisor, the Sub-Advisor will, in coordination with the Advisor as described
below: (a) provide a program of continuous investment management for the Fund;
(b) make investment decisions for the Fund; and (c) place orders to purchase and
sell securities for the Fund in accordance with the Fund's investment
objectives, policies and limitations as stated in the Fund's current Prospectus
and Statement of Additional Information as provided to the Sub-Advisor by the
Advisor, as they may be amended from time to time; provided, that the Advisor
shall provide the Sub-Advisor reasonable advance notice of any change to such
investment objectives, policies and limitations.
The Sub-Advisor further agrees that, in performing its duties hereunder, it
will:
(a) with regard to its activities under this Agreement, use reasonable efforts
to comply in all material respects with the applicable provisions of the 1940
Act, the Advisers Act, and all applicable rules and regulations thereunder, the
U.S. Internal Revenue Code of 1986, as amended (the "Code"), and all other
applicable federal and state laws and regulations, and with any applicable
procedures adopted by the Trustees, as they may be amended from time to time,
provided that written copies of such procedures and amendments thereto are
provided to the Sub-Advisor by the Advisor;
(b) use reasonable efforts to manage the Fund so that it will qualify, and
continue to qualify, as a regulated investment company under Subchapter M of the
Code and regulations issued thereunder; provided, however, the Sub-Advisor shall
not be responsible for the tax effect of any decisions made by or any actions
taken by any person other than the Sub-Advisor;
(c) place orders pursuant to its investment determinations for the Fund, in
accordance with applicable policies expressed in the Fund's Prospectus and/or
Statement of Additional Information or otherwise established through written
guidelines established by the Fund and provided to the Sub-Advisor by the
Advisor, including without limitation, Section 4 hereof;
(d) furnish to the Trust and the Advisor whatever statistical information the
Trust or the Advisor may reasonably request with respect to the Fund's assets or
investments. In addition, the Sub-Advisor will keep the Trust, the Advisor and
the Trustees informed of developments that the Sub-Advisor reasonably believes
will materially affect the Fund's portfolio, and shall, on the Sub-Advisor's own
initiative, furnish to the Trust from time to time whatever information the
Sub-Advisor believes appropriate for this purpose;
(e) make available to the Fund's administrator (the "Administrator"), the
Advisor and the Trust, promptly upon their request, such copies of its
investment records and ledgers with respect to the Fund as may reasonably be
required to assist the Advisor, the Administrator and the Trust in their
compliance with applicable laws and regulations. The Sub-Advisor will furnish
the Trustees, the Administrator, the Advisor and the Trust with such periodic
and special reports regarding the Fund as they may reasonably request;
(f) meet periodically with the Advisor and the Trustees, in person or by
teleconference, to explain its investment management activities, and any reports
related to the Fund as may reasonably be requested by the Advisor and/or the
Trust;
(g) as soon as reasonably practicable notify the Advisor, in writing, of the
receipt of any notice of a class action proceeding related to the Fund or any
other action or proceeding in which the Advisor or the Fund may be entitled to
participate as a result of the Fund's securities holdings. The Sub-Advisor shall
have no responsibility for filing claims on behalf of the Advisor or the Trust
with respect to any such actions. The Sub-Advisor's responsibility with respect
to such matters shall be to comply with the foregoing notification obligations
and to cooperate with the Advisor and the Trust in making such filings, which
shall include providing any relevant information regarding the Fund's securities
holdings to the Advisor;
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(h) to monitor the assets of the Fund and to use commercially reasonable efforts
to notify the Advisor or its designee on any day that the Sub-Advisor determines
that a significant event has occurred with respect to one or more securities
held in the Fund which would materially affect the value of such securities. As
requested by the Advisor or the Trustees, the Sub-Advisor hereby agrees to
provide additional reasonable assistance to the Advisor, custodian or
recordkeeping agent for the Fund so that the Trust can value the assets of the
Fund held in the portfolio. Such assistance may include assistance with the
Trust's fair value pricing of portfolio securities, as requested by the Advisor.
The Sub-Advisor agrees that it will act, at all times, in accordance with the
Sub-Advisor's Pricing Policy. Notwithstanding the foregoing, the Advisor
acknowledges and agrees that the Sub-Advisor is not a pricing vendor for the
Funds and does not have responsibility for determining the market value of any
asset in the Funds;
(i) provide reasonable assistance to the Advisor, the Fund, and any of its or
their trustees, directors, officers, and/or employees in the Fund complying with
the provisions of the Xxxxxxxx-Xxxxx Act of 2002 to the extent such provisions
relate to the services to be provided by, and obligations of, the Sub-Advisor
hereunder. Specifically, and without limitation to the foregoing, the
Sub-Advisor agrees to provide reasonable certifications to the principal
executive and financial officers of the Fund that correspond to the drafting
and/or filing of the Fund's Form N-CSRs. N-Qs, N-SARs, shareholder reports,
financial statements, and other disclosure documents or regulatory filings, in
such form and content as the Advisor and the Sub-Advisor shall agree from time
to time;
(j) provide reasonable assistance to the Fund, and accordingly, the Trust's
Chief Compliance Officer ("CCO") in the Fund complying with Rule 38a-1 under the
1940 Act. Specifically, the Sub-Advisor represents and warrants that it shall
maintain a compliance program in accordance with the requirements of Rule
206(4)-7 under the Advisers Act, and shall provide the CCO with reasonable
access to information regarding the Sub-Advisor's compliance program, which
access shall include on-site visits with the Sub-Advisor as may be reasonably
requested from time to time. In connection with the periodic review and annual
report required to be prepared by the CCO pursuant to Rule 38a-1, the
Sub-Advisor agrees to provide reasonable certifications as may be reasonably
requested by the CCO related to the design and implementation of the
Sub-Advisor's compliance program;
(k) provide assistance as may be reasonably requested by the Advisor in
connection with compliance by the Fund with any current or future legal and
regulatory requirements applicable to the Fund related to the services provided
by the Sub-Advisor hereunder;
(l) as soon as reasonably practicable notify the Advisor and the Trust to the
extent required by applicable law in the event that the Sub-Advisor or any of
its affiliates: (1) becomes aware that it is subject to a statutory
disqualification that prevents the Sub-Advisor from serving as an investment
advisor pursuant to this Agreement; or (2) becomes aware that it is the subject
of an administrative proceeding or enforcement action by the Securities and
Exchange Commission ("SEC") or other regulatory authority. The Sub-Advisor
further agrees to notify the Trust and the Advisor immediately of any material
fact known to the Sub-Advisor respecting or relating to the Sub-Advisor that
would make any written information previously provided to the Advisor or the
Trust materially inaccurate or incomplete or if any such written information
becomes untrue in any material respect;
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(m) as soon as reasonably practicable notify the Advisor and the Trust if the
Sub-Advisor suffers a material adverse change in its business that would
materially impair its ability to perform its relevant duties for the Fund;
(n) use no inside information that may be in its possession in making investment
decisions for the Fund consistent with applicable law;
(o) use commercially reasonable efforts in rendering the advice and services
contemplated by this Agreement; and
(p) notwithstanding any other provisions to the contrary, the Sub-Advisor shall
have no obligation to perform the following services or to have employees of the
Sub-Advisor perform the following roles, as applicable: (a) shareholder services
or other support functions, such as responding to shareholders' questions about
the Fund or its investments or strategies; (b) providing employees of the
Sub-Advisor to serve as officers of the Trust; or (c) providing employees of the
Sub-Advisor to serve as the Trust's Chief Compliance Officer and associated
staff.
3. Investment Authority. The Sub-Advisor's investment authority shall include,
to the extent permitted under Section 2 hereof, the authority to purchase, sell,
and cover open positions, and generally to deal in securities, swaps (including
but not limited to interest rate swaps and credit default swaps), financial
futures contracts and options thereon, currency transactions, and other
derivatives and investment instruments and techniques as may be permitted for
use by the Fund and consistent with the Registration Statement.
The Sub-Advisor may: (i) open and maintain brokerage accounts for financial
futures and options and securities (such accounts hereinafter referred to as
"Brokerage Accounts") on behalf of and in the name of the Fund; (ii) execute for
and on behalf of the Brokerage Accounts, standard customer agreements with a
broker or brokers; and (iii) acknowledge the receipt of brokers' risk disclosure
statements, electronic trading disclosure statements and similar disclosures.
The Sub-Advisor may, using such of the securities and other property in the
Brokerage Accounts as the Sub-Advisor deems necessary or desirable, direct the
custodian to deposit on behalf of the Fund, original and maintenance brokerage
deposits and otherwise direct payments of cash, cash equivalents and securities
and other property into such brokerage accounts and to such brokers as the
Sub-Advisor deems desirable or appropriate.
4. Investment Guidelines. In addition to the information to be provided to the
Sub-Advisor under Section 2 hereof, the Trust or the Advisor shall supply the
Sub-Advisor with such other information as the Sub-Advisor shall reasonably
request concerning the Fund's investment policies, restrictions, limitations,
tax position, liquidity requirements and other information useful in managing
the Fund's investments.
5. Representations, Warranties and Covenants of the Trust, Advisor and
Sub-Advisor. The Trust represents and warrants to the Sub-Advisor that: (i) the
retention of the Sub-Advisor as contemplated by this Agreement is authorized by
the respective governing documents of the Fund; (ii) the execution, delivery and
performance of this Agreement does not violate any obligation by which either
the Fund or its property is bound, whether arising by contract,
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operation of law or otherwise; and (iii) this Agreement has been duly authorized
by appropriate action of the Fund and when executed and delivered by the
Advisor, on behalf of the Fund (and assuming due execution and delivery by the
Sub-Advisor), will be the legal, valid and binding obligation of the Fund,
enforceable against the Fund in accordance with its terms, subject, as to
enforcement, to applicable bankruptcy, insolvency and similar laws affecting
creditors' rights generally and to general equitable principles (regardless of
whether enforcement is sought in a proceeding in equity or law).
The Advisor represents and warrants to the Sub-Advisor that: (i) the execution,
delivery and performance of this Agreement does not violate any obligation by
which it or its property is bound, whether arising by contract, operation of law
or otherwise; and (ii) this Agreement has been duly authorized by appropriate
action of the Advisor and when executed and delivered by the Advisor (and
assuming due execution and delivery by the Sub-Advisor) will be the legal, valid
and binding obligation of the Advisor, enforceable against the Advisor in
accordance with its terms, subject, as to enforcement, to applicable bankruptcy,
insolvency and similar laws affecting creditors' rights generally and to general
equitable principles (regardless of whether enforcement is sought in a
proceeding in equity or law).
The Trust and the Advisor represent and warrant to the Sub-Advisor that: (i) the
Fund is a "qualified institutional buyer" ("QIB") as defined in Rule 144A under
the Securities Act of 1933, as amended, and the Advisor will promptly notify the
Sub-Advisor if the Fund ceases to be a QIB; (ii) the Fund is a "qualified
eligible person" ("QEP") as defined in Commodity Futures Trading Commission Rule
4.7 ("CFTC Rule 4.7"), and the Advisor will promptly notify the Sub-Advisor if
the Fund ceases to be a QEP, and hereby consents for the Fund to be treated as
an "exempt account" under CFTC Rule 4.7; and (iii) the assets of the Fund are
free from all liens and charges, and the Advisor undertakes that no liens or
charges will arise from the acts or omissions of the Advisor which may prevent
the Sub-Advisor from giving a first priority lien or charge on the assets solely
in connection with the Sub-Advisor's authority to direct the deposit of margin
or collateral to the extent necessary to meet the obligations of the Fund with
respect to any investments made for the Fund.
The Sub-Advisor represents and warrants to the Advisor and the Trust that: (i)
it is authorized to perform the services hereunder; (ii) the execution, delivery
and performance of this Agreement does not violate any obligation by which the
Sub-Advisor or its property is bound, whether arising by contract, operation of
law or otherwise; (iii) this Agreement has been duly authorized by appropriate
action of the Sub-Advisor and when executed and delivered by the Sub-Advisor
(and assuming due execution and delivery by the Advisor and the Trust) will be
the legal, valid and binding obligation of the Sub-Advisor, enforceable against
the Sub-Advisor in accordance with its terms, subject, as to enforcement, to
applicable bankruptcy, insolvency and similar laws affecting creditors' rights
generally and to general equitable principles (regardless of whether enforcement
is sought in a proceeding in equity or law); (iv) it is registered as an
investment advisor with the SEC; and (v) it is not barred by operation of law,
or any rule, or order of the SEC or any other regulatory body from acting as an
investment advisor.
The Sub-Advisor may delegate portfolio management and administrative duties to
its affiliates and may share such information as necessary to accomplish these
purposes. Additionally, the Sub-Advisor will have the ability to delegate back
office services to State Street Investment
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Manager Solutions, LLC. In all cases, the Sub-Advisor shall remain liable as if
such services were provided directly. No additional fees shall be imposed for
such services except as otherwise agreed.
6. Use of Securities Brokers and Dealers. In placing purchase and sale orders
for the Fund with brokers or dealers, the Sub-Advisor will attempt to obtain
"best execution" of such orders. Whenever the Sub-Advisor places orders, or
directs the placement of orders, for the purchase or sale of portfolio
securities on behalf of the Fund, in selecting brokers or dealers to execute
such orders, the Sub-Advisor is expressly authorized to consider the fact that a
broker or dealer has furnished statistical, research or other information or
services that enhance the Sub-Advisor's research and portfolio management
capability generally. It is further understood in accordance with Section 28(e)
of the Securities Exchange Act of 1934, as amended, that the Sub-Advisor may
negotiate with and assign to a broker a commission that may exceed the
commission that another broker would have charged for effecting the transaction
if the Sub-Advisor determines in good faith that the amount of commission
charged was reasonable in relation to the value of brokerage and/or research
services (as defined in Section 28(e)) provided by such broker, viewed in terms
of the Sub-Advisor's overall responsibilities to the Sub-Advisor's discretionary
accounts (the "Section 28(e) Actions"); provided, however, that Sub-Advisor's
ability to engage in Section 28(e) Actions shall be subject to review by the
Trustees from time to time, and if such Trustees reasonably determine that the
Fund does not benefit, directly or indirectly, from such Section 28(e) Actions,
Advisor shall inform the Sub-Advisor in writing that the Sub-Advisor shall be
prohibited from engaging in the same.
Unless otherwise directed by the Trust or the Advisor in writing, the
Sub-Advisor may utilize the service of whatever securities brokerage firm or
firms it deems appropriate to the extent that such firms are competitive with
respect to price of services and execution, and so long as the Sub-Advisor
complies with the "best execution" practices described above and applicable law
and regulation.
7. Compensation. The Trust agrees to pay a Fee to the Sub-Advisor for the Fund
assets managed by the Sub-Advisor, calculated as set forth in Exhibit A attached
hereto and incorporated by reference herein. The Sub-Advisor acknowledges that
the fee is payable solely out of the assets of the Fund.
The Fee shall be computed and accrued daily and paid monthly in arrears based on
the average daily net asset value of the Fund as determined according to the
manner provided in the then-current prospectus of the Fund.
The Advisor shall provide to the Sub-Advisor, promptly following request
therefor, all information reasonably requested by the Sub-Advisor to support the
calculation of the Fee and shall permit the Sub-Advisor or its agents, upon
reasonable notice and at reasonable times to inspect the books and records of
the Fund pertaining to such calculation.
8. Expenses. The Sub-Advisor will not be required to pay any expenses of the
Fund except as expressly set forth in this Section 8. The Sub-Advisor will pay
the cost of maintaining the staff and personnel necessary for it to perform its
obligations under this Agreement, the expenses of office rent, telephone,
telecommunications and other facilities it is obligated to provide in
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order to perform the services specified in Section 2, and any other expenses
incurred by the Sub-Advisor in the performance of its duties hereunder.
Notwithstanding the foregoing, the Sub-Advisor shall not bear the cost of any
expenses incurred by the Fund due to portfolio management decisions by the
Sub-Advisor.
9. Books and Records. The Sub-Advisor agrees to maintain such books and records
with respect to its services to the Fund as are required by Section 31 under the
1940 Act, and rules adopted thereunder, and to preserve such records for the
periods and in the manner required by that Section, and those rules. The
Sub-Advisor also agrees that records it maintains and preserves pursuant to
Rules 31a-1 and Rule 31a-2 under the 1940 Act with respect to the Fund are the
property of the Trust and will be surrendered promptly to the Trust upon its
request, except that the Sub-Advisor may retain copies of such documents as may
be required by law. The Sub-Advisor further agrees that it will furnish to
regulatory authorities having the requisite authority any information or reports
in connection with its services hereunder which may be requested in order to
determine whether the operations of the Fund are being conducted in accordance
with applicable laws and regulations. Each party shall make available to the
others, upon reasonable request, copies of any books, records, and other
relevant information relating specifically to the Fund that enables the
requesting party to comply with its obligations under applicable federal or
state rules or regulations, including Rule 38a-1 of the 1940 Act and Rule
206(4)-7 of the Advisers Act, that arise as a result of the Agreement. Each
party shall cooperate fully to assist the others with any review or audit
conducted by another party or a third party designated by another party, for the
limited purpose of ensuring compliance with obligations under applicable federal
or state laws that the parties become subject to as a result of the Agreement.
10. Aggregation of Orders. Provided the investment objectives, policies and
restrictions of the Fund as provided to the Sub-Advisor in accordance with this
Agreement are adhered to, the Fund agrees that the Sub-Advisor may aggregate
sales and purchase orders of securities held in the Fund with similar orders
being made simultaneously for other accounts managed by the Sub-Advisor or with
accounts of the affiliates of the Sub-Advisor, if in the Sub-Advisor's
reasonable judgment such aggregation shall result in an overall economic benefit
to the Fund. The Fund acknowledges that the determination of such economic
benefit to the Fund by the Sub-Advisor represents the Sub-Advisor's evaluation
that the Fund may be benefited by relatively better purchase or sales prices,
lower commission expenses and beneficial timing of transactions or a combination
or a subset of these and other factors.
11. Liability. Neither the Sub-Advisor nor its officers, directors, members,
employees, affiliates, agents or controlling persons shall be liable to the
Trust, the Fund, its shareholders and/or any other person for the acts,
omissions, errors of judgment and/or mistakes of law of any other fiduciary
and/or other person with respect to the Fund.
Neither the Sub-Advisor nor its officers, directors, members, employees,
affiliates, agents or controlling persons or assigns shall be liable for any
act, omission, error of judgment or mistake of law (whether or not deemed a
breach of this Agreement) and/or for any loss suffered by the Trust, the Fund,
its shareholders, the Advisor, and/or any other person in connection with the
matters to which this Agreement relates; provided that no provision of this
Agreement shall be deemed to protect the Sub-Advisor against any liability to
the Trust, the Fund, the Advisor,
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and/or its shareholders to which it might otherwise be subject by reason of any
willful misfeasance, bad faith or gross negligence in the performance of its
duties or the reckless disregard of its obligations and duties under this
Agreement.
The Trust, on behalf of the Fund, hereby agrees to indemnify and hold harmless
the Sub-Advisor, its directors, members, officers, employees, affiliates, agents
and controlling persons (collectively, the "Indemnified Parties") against any
and all losses, claims damages or liabilities (including reasonable attorneys
fees and expenses), joint or several, relating to the Trust or the Fund, to
which any such Indemnified Party may become subject under the Securities Act of
1933, as amended (the "1933 Act"), the Securities Exchange Act of 1934, the
Advisers Act, the 1940 Act, or other federal or state statutory law or
regulation, at common law or otherwise. It is understood, however, that nothing
in this paragraph 11 shall protect any Indemnified Party against, or entitle any
Indemnified Party to, indemnification against any liability to the Trust, the
Fund or its shareholders to which such Indemnified Party is subject, by reason
of its willful misfeasance, bad faith or gross negligence in the performance of
its duties, or by reason of any reckless disregard of its obligations and duties
under this Agreement.
12. Services Not Exclusive. The services of the Sub-Advisor are not exclusive,
and nothing in this Agreement shall prevent the Sub-Advisor from providing
similar services to other investment advisory clients, including but not by way
of limitation, investment companies or to other series of investment companies,
including the Trust, or from engaging in other activities, provided such other
services and activities do not, during the term of this Agreement, interfere in
a material manner with the Sub-Advisor's ability to meet its obligations to the
Fund hereunder. When the Sub-Advisor recommends the purchase or sale of a
security for other investment companies and other clients, and at the same time
the Sub-Advisor recommends the purchase or sale of the same security for the
Fund, it is understood that in light of its fiduciary duty to the Fund, such
transactions will be executed on a basis that is fair and equitable to the Fund.
Except as permitted by law, in connection with purchases or sales of portfolio
securities for the account of the Fund, neither the Sub-Advisor nor any of its
directors, members, officers or employees shall act as a principal. If the
Sub-Advisor provides any advice to its clients concerning the shares of the
Fund, the Sub-Advisor shall act solely as investment counsel for such clients
and not in any way on behalf of the Trust or the Fund.
The Sub-Advisor provides investment advisory services to numerous other
investment advisory clients, including but not limited to other funds, and may
give advice and take action which may differ from the timing or nature of action
taken by the Sub-Advisor with respect to the Fund. Nothing in this Agreement
shall impose upon the Sub-Advisor any obligations other than those imposed by
law to purchase, sell or recommend for purchase or sale, with respect to the
Fund, any security which the Sub-Advisor, or the shareholders, officers,
directors, members, employees or affiliates may purchase or sell for their own
account or for the account of any client.
13. Materials. Each of the Advisor, the Trust and the Fund shall not make any
representations regarding the Sub-Advisor or any of its affiliates in any
disclosure document, advertisement, sales literature or other promotional
materials without prior written consent of the Sub-Advisor, which consent shall
not be unreasonably withheld. If the Sub-Advisor has not notified the Advisor of
its disapproval of sample materials within twenty (20) days after its receipt
thereof, such materials shall be deemed approved. The Sub-Advisor will be
provided with
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any Registration Statements containing references or information with respect to
the Sub-Advisor prior to the filing of same with any regulatory authority and
shall be afforded the opportunity to comment thereon.
14. Duration and Termination. This Agreement shall continue until September 30,
2009, and thereafter shall continue automatically for successive annual periods,
provided such continuance is specifically approved at least annually by (i) the
Board of Trustees or (ii) a vote of a "majority" (as defined in the 0000 Xxx) of
the Fund's outstanding voting securities (as defined in the 1940 Act), provided
that in either event the continuance is also approved by a majority of the
Trustees who are not parties to this Agreement or "interested persons" (as
defined in the 0000 Xxx) of any party to this Agreement, by vote cast in person
at a meeting called for the purpose of voting on such approval.
Notwithstanding the foregoing, this Agreement may be terminated: (a) at any time
without penalty by the Fund upon the vote of a majority of the Trustees or by
vote of the majority of the Fund's outstanding voting securities, upon sixty
(60) days' written notice to the Sub-Advisor; (b) by the Advisor at any time
without penalty, upon sixty (60) days' written notice to the Sub-Advisor; or (c)
by the Sub-Advisor at any time without penalty, upon sixty (60) days ' written
notice to the Trust. This Agreement will also terminate automatically in the
event of its assignment (as defined in the 1940 Act).
The Agreement will terminate immediately upon written notification from the
Advisor or the Trust if the Investment Management Agreement terminates with
respect to the Fund.
15. Amendments. This Agreement may be amended at any time, but only by the
mutual written agreement of the parties.
16. Proxies. Unless the Trust gives written instructions to the contrary, the
Sub-Advisor shall vote all proxies solicited by or with respect to the issuers
of securities invested in by the Fund. The Sub-Advisor shall maintain a record
of how the Sub-Advisor voted and such record shall be available to the Trust
upon its request. The Sub-Advisor shall use its good faith judgment to vote such
proxies in a manner which best serves the interests of the Fund's shareholders.
The Sub-Advisor may delegate proxy voting to a third-party company provided,
however, that the Sub-Advisor remains liable for the proxy voting.
17. Notices. Any written notice required by or pertaining to this Agreement
shall be personally delivered to the party for whom it is intended or shall be
sent to such party by prepaid first class mail, electronic mail or facsimile, at
the address or number stated below.
If to the Trust:
Forward Funds
000 Xxxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Facsimile: (000) 000-0000
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If to the Sub-Advisor:
Pacific Investment Management Company LLC
000 Xxxxxxx Xxxxxx Xxxxx
Xxxxxxx Xxxxx, XX 00000
Facsimile: (000) 000-0000
Attention: General Counsel
Email: XXXXxxxxxx@xxxxx.xxx
cc: Xxxxx Xxxxxxx, Account Manager
Email: xxxxx.xxxxxxx@xxxxx.xxx
If to the Advisor:
Forward Management, LLC
000 Xxxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Facsimile: (000) 000-0000
18. Confidential Information. Any information supplied by the Trust, the Fund or
the Advisor, which is not otherwise in the public domain, in connection with the
Fund or the Advisor is to be regarded as confidential and for use only by the
Sub-Advisor and/or its agents, and only in connection with the Sub-Advisor's
services under this Agreement. Any information supplied by the Sub-Advisor,
which is not otherwise in the public domain, in connection with the performance
of its duties hereunder is to be regarded as confidential and for use only by
the Fund and/or its agents, and only in connection with the Fund and its
investments. Any party in receipt of confidential information shall use
reasonable precautions (substantially identical to those used in safeguarding of
its own confidential information) to ensure that its directors, officers,
employees and advisors abide by these confidentiality provisions.
19. Miscellaneous.
(a) Governing Law. This Agreement shall be governed by the laws of the State of
California, provided that nothing herein shall be construed in a manner
inconsistent with the 1940 Act, the Advisers Act, or rules or applicable orders
of the SEC thereunder.
(b) Delivery of Form ADV. Concurrently with the execution of this Agreement, the
Sub-Advisor is delivering to the Advisor and the Trust a copy of Part II of its
current Form ADV. The Advisor and the Trust hereby acknowledge receipt of such
copy.
(c) Captions. The captions of this Agreement are included for convenience only
and in no way define or limit any of the provisions hereof or otherwise affect
their construction or effect.
(d) 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.
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(e) Agency Relationship. Nothing herein shall be construed as constituting the
Sub-Advisor as an agent of the Trust or the Fund, except as otherwise
contemplated herein.
(f) Prior Agreement. This Agreement supersedes any prior agreement relating to
the subject matter hereof among the parties or their predecessors in interest.
(g) Counterparts. This Agreement may be executed in counterparts and by the
different parties hereto on separate counterparts and by facsimile signature,
each of which when so executed and delivered, shall be deemed an original and
all of which counterparts shall constitute but one and the same agreement.
(h) Limited Liability of the Trust. The Sub-Advisor agrees that the Trust's
obligations under this Agreement shall be limited to the Fund and its assets,
and that the Sub-Advisor shall not seek satisfaction of any such obligation from
the shareholders of the Fund nor from any Trustee, officer, employee or agent of
the Trust.
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IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be executed by their officers designated below as of the effective date above
written.
PURSUANT TO AN EXEMPTION FROM THE COMMODITY FUTURES TRADING COMMISSION IN
CONNECTION WITH ACCOUNTS OF QUALIFIED ELIGIBLE PERSONS, THIS ACCOUNT DOCUMENT IS
NOT REQUIRED TO BE, AND HAS NOT BEEN, FILED WITH THE COMMISSION. THE COMMODITY
FUTURES TRADING COMMISSION DOES NOT PASS UPON THE MERITS OF PARTICIPATING IN A
TRADING PROGRAM OR UPON THE ADEQUACY OR ACCURACY OF COMMODITY TRADING ADVISOR
DISCLOSURE. CONSEQUENTLY, THE COMMODITY FUTURES TRADING COMMISSION HAS NOT
REVIEWED OR APPROVED THIS TRADING PROGRAM OR THIS ACCOUNT DOCUMENT.
FORWARD FUNDS
By: /s/ J. Xxxx Xxxx, Jr.
-----------------------------------
Name: J. Xxxx Xxxx, Jr.
Title: President
FORWARD MANAGEMENT, LLC
By: /s/ Xxxx Xxxxxx
-----------------------------------
Name: Xxxx Xxxxxx
Title: Secretary
PACIFIC INVESTMENT MANAGEMENT COMPANY LLC
By: /s/ Xxxxx X. Xxxxxx
-----------------------------------
Name: Xxxxx X. Xxxxxx
Title: Managing Director
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EXHIBIT A
Pursuant to paragraph 7 of the Agreement, the Fund will pay to the
Sub-Advisor as compensation for the Sub-Advisor's services rendered, a Fee,
computed and accrued daily and paid monthly in arrears at the annual rate of
0.25% of the average daily net assets of the Fund.
The Fee shall be paid to the Sub-Advisor by the Fund and no fees shall
be paid to the Advisor under the Agreement.
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