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Exhibit (d) (ii) under Form N-1A
Exhibit (10) under Item 601/Reg. S-K
SUB-ADVISORY AGREEMENT
CCB Funds
THIS SUB-ADVISORY AGREEMENT (the "Agreement") is made between Commerce
Capital Management, Inc., an investment adviser headquartered in Durham,
North Carolina (hereinafter referred to as "Adviser") and Franklin Street
Advisors, Inc., a North Carolina corporation headquartered in Chapel Hill,
North Carolina (hereinafter referred to as the "Sub-Adviser").
W I T N E S S E T H :
That the parties hereto, intending to be legally bound hereby agree as
follows:
1. Appointment.
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Adviser serves as the investment adviser to CCB Equity Fund (the
"Fund"), a portfolio of CCB Funds, a business trust formed under the laws of
the Commonwealth of Massachusetts (the "Trust"). In this capacity, Adviser
desires to employ the services of Sub-Adviser and Sub-Adviser agrees to
furnish the services for the compensation as set forth below.
2. Services as Sub-Adviser.
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Sub-Adviser shall furnish certain investment advisory services to
Adviser, as may from time to time be reasonably requested by Adviser,
including investment research, statistical and other factual information, and
recommendations based on Sub-Adviser's analysis, and assistance to the
Adviser in identifying securities for potential purchase and/or sale.
3. Compensation.
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For its services under this Agreement, Adviser shall pay to Sub-Adviser
an annual fee in quarterly installments (the "Sub-Advisory Fee") as set forth
in Exhibit A hereto. In the event that the fee due from the Trust on behalf
of the Fund to Adviser (the "Advisory Fee") is reduced in order to meet
expense limitations imposed on the Fund by state securities laws or
regulations, or in the event that all or a portion of the Advisory Fee is
voluntarily waived by the Adviser, the Sub-Advisory Fee shall be reduced in
an amount so that the Sub-Advisory Fee shall always be an amount equal to
65/85 of the Advisory Fee.
Notwithstanding any other provision of this Agreement, if the Fund's
expenses exceed such lower expense limitations, the Sub-Adviser may from time
to time and for such periods as it deems appropriate voluntarily reduce its
compensation (and, if appropriate, assume expenses of the Fund) by notice to
the Trust.
4. Term of Agreement.
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(a) The effective date of this Agreement shall be the date as
specified by the parties in Exhibit A hereto ("Effective Date"). This
Agreement shall continue in effect for the period specified in Exhibit A,
provided each annual continuance is specifically approved at least annually:
(i) by the vote of a majority of the Trust's Board of Trustees who are not
parties to this Agreement or "interested persons" (as defined in the
Investment Company Act of 1940, the "Act") of any such party cast in person
at a meeting called for the purpose of voting on such approval; and (ii)
either by the vote of a majority of the Trust's Board of Trustees or by the
vote of a majority of the outstanding voting securities (as defined in the
Act) of the Fund.
(b) This Agreement may be terminated at any time without the
payment of any penalty: (i) by the Trust's Board of Trustees or by a vote of
a majority of the outstanding voting securities, as defined in the Act, of
the Fund upon sixty (60) days' written notice to Adviser; or (ii) by
Sub-Adviser or Adviser upon 120 days' written notice to the other party to
the Agreement.
(c) This Agreement shall automatically terminate: (i) in the
event of its assignment, as defined in the Act; or (ii) in the event of
termination of the Investment Advisory Contract between Adviser and the Trust
(the "Investment Advisory Contract") for any reason whatsoever.
5. Modification of Relationships.
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So long as both Adviser and Sub-Adviser shall be legally qualified to
act as an investment adviser to the Fund, neither Adviser nor Sub-Adviser
shall act as an investment adviser (as such term is defined in the Act) to
the Fund except as provided herein and in the Investment Advisory Contract or
in such other manner as may be expressly agreed between Adviser and
Sub-Adviser.
Provided, however, that if the Adviser or Sub-Adviser shall resign
prior to the end of any term of this Agreement or for any reason be unable or
unwilling to serve for a successive term which has been approved by the
Trust's Board of Trustees pursuant to the provisions of Section 4 of this
Agreement or Section 6 of the Investment Advisory Contract, the remaining
party, Sub-Adviser or Adviser, as the case may be, shall not be prohibited
from serving as an investment adviser to the Fund by reason of the provisions
of this Section 5.
6. Standard of Care.
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Sub-Adviser shall exercise its best judgment in rendering the services
listed in Section 2 above. Sub-Adviser shall not be liable for any error of
judgment or mistake of law or for any loss suffered by the Fund or
shareholders of the Fund in connection with the matters to which this
Agreement relates, provided that nothing in this Agreement shall be deemed to
protect or purport to protect Sub-Adviser against liability to the Fund or to
its shareholders to which Sub-Adviser would otherwise be subject by reason of
willful misfeasance, bad faith or gross negligence on its part in the
performance of its duties or by reason of Sub-Adviser's reckless disregard of
its obligations and duties under this Agreement ("disabling conduct").
Except for such disabling conduct, the Adviser shall indemnify the
Sub-Adviser (and its officers, directors, agents, employees, controlling
persons, shareholders and any other person or entity affiliated with the
Sub-Adviser) against any liability arising from the Sub-Adviser's conduct
under this Agreement. It is agreed that the Sub-Adviser shall have no
responsibility or liability for the accuracy or completeness of the Adviser's
Registration Statement under the Act and the Securities Act of 1933, as
amended, except for information supplied by the Sub-Adviser for inclusion
therein.
7. Service to Other Accounts.
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Nothing in this Agreement shall prevent the Sub-Adviser or any
"affiliated person" (as defined in the Act) of the Sub-Adviser from acting as
investment adviser or manager for any other person, firm or corporation and
shall not in any way limit or restrict the Sub-Adviser or any such affiliated
person from buying, selling or trading any securities for its or their own
accounts of for the accounts of others for whom it or they may be acting,
provided, however, that the Sub-Adviser expressly represents that it will
undertake no activities which, in its judgment, will adversely affect the
performance of its obligations to the Adviser under this Agreement. In
addition, the Adviser understands that the persons employed by Sub-Adviser to
assist in the performance of Sub-Adviser's duties under this Agreement will
not devote their full time to such service and nothing contained in this
Agreement shall be deemed to limit or restrict the right of Sub-Adviser or
any affiliate of Sub-Adviser to engage in and devote time and attention to
other businesses or to render services of any kind or nature. The
Sub-Adviser shall be deemed to be an independent contractor and, unless
otherwise expressly provided or authorized, have no authority to act or
represent the Adviser in any way or otherwise be deemed an agent of the
Adviser.
8. Reference to the Sub-Adviser.
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Neither the Adviser or any affiliate or agent thereof shall make
reference to or use the name of the Sub-Adviser or any of its affiliates in
any advertising or promotional materials without the prior approval of the
Sub-Adviser, which approval shall not be unreasonably withheld.
9. Amendment.
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This Agreement may be amended from time to time by agreement of the
parties hereto provided that such amendment shall be approved both by the
vote of a majority of the Trust's Board of Trustees, including a majority of
Trustees who are not parties to this Agreement or interested persons, as
defined in the Act, of any such party at a meeting called for that purpose,
and by the holders of a majority of the outstanding voting securities, as
defined in the Act, of the Fund.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed on their behalf by their duly authorized officers this 10th day of
May, 2001.
COMMERCE CAPITAL MANAGEMENT, INC.
By: /s/ Xxxxxx X. Xxxxxxx
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Name: Xxxxxx X. Xxxxxxx
Title: Chairman and CEO
FRANKLIN STREET ADVISORS, INC.
By: /s/ Xxxxxx X. Xxxx
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Name: Xxxxxx X. Xxxx
Title: Vice President
Exhibit A
CCB Equity Fund
Sub-Advisory Agreement
THIS EXHIBIT A (the "Exhibit") to the Sub-Advisory Agreement dated May
10, 2001 between Commerce Capital Management, Inc., an investment adviser
headquartered in Durham, North Carolina ("Adviser") and Franklin Street
Advisors, Inc., a North Carolina corporation headquartered in Chapel Hill,
North Carolina ("Sub-Adviser")';
For all services rendered by Sub-Adviser under the Agreement, Adviser
shall pay Sub-Adviser a Sub-Advisory Fee equal to .65 of 1% of the average
daily net assets of the Fund.
The effective date of the Agreement shall be the 10th day of May, 2001
to be renewed on or before May 9, 2003 and annually thereafter.
This Exhibit duly incorporates by reference the Sub-Advisory Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed on their behalf by their duly authorized officers, and their
corporate seals to be affixed hereto this 10th day of May, 2001.
COMMERCE CAPITAL MANAGEMENT, INC.
By: /s/ Xxxxxx X. Xxxxxxx
-------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Chairman and CEO
FRANKLIN STREET ADVISORS, INC.
By: /s/ Xxxxxx X. Xxxx
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Name: Xxxxxx X. Xxxx
Title: Vice President
