EXHIBIT 99d(29)
FORM OF
INVESTMENT ADVISORY AGREEMENT FOR SUBADVISER
(HARBOR MID CAP VALUE FUND)
Dear Sirs:
Harbor Capital Advisors, Inc. (the "Adviser"), a Delaware corporation, with its
principal offices at One XxxXxxx, Xxxxxx, Xxxx 00000, is the investment adviser
to Harbor Fund (the "Trust") on behalf of Harbor Mid Cap Value Fund (the
"Fund"). The Trust has been organized under the laws of Delaware to engage in
the business of an investment company. The shares of beneficial interest of the
Trust ("Shares") are divided into multiple series including the Fund, as
established pursuant to a written instrument executed by the Trustees of the
Trust. The Trust is an open-end, management investment company registered under
the Investment Company Act of 1940, as amended (the "Investment Company Act").
Pursuant to authority granted the Adviser by the Trust's Trustees, the Adviser
has selected you to act as a sub-investment adviser of the Fund and to provide
certain other services, as more fully set forth below. You are willing to act as
such a sub-investment adviser and to perform such services under the terms and
conditions hereinafter set forth, and you represent and warrant that you are an
investment adviser registered under the Investment Advisers Act of 1940, as
amended (the "Investment Advisers Act"). Accordingly, the Adviser and the Trust
on behalf of the Fund agree with you as follows:
1. DELIVERY OF FUND DOCUMENTS. The Adviser has furnished you with copies,
properly certified or authenticated, of each of the following:
(a) Agreement and Declaration of Trust of the Trust, as in effect on
the date hereof (the "Declaration of Trust").
(b) By-Laws of the Trust as in effect on the date hereof (the
"By-Laws").
(c) Resolutions of the Trustees selecting the Adviser as investment
adviser and you as a sub-investment adviser and approving the
form of this Agreement.
The Adviser will furnish you from time to time with copies, properly
certified or authenticated, of all amendments of or supplements to the
foregoing, including future resolutions of the Trustees approving the
continuance of the items listed in (c) above.
2. ADVISORY SERVICES. You will regularly provide the Fund with advice
concerning the investment management of that portion of the Fund's assets
that are allocated to you, which advice shall be consistent with the
investment objectives and policies of the Fund as set forth in the Fund's
Prospectus and Statement of Additional Information and any investment
guidelines or other instructions received in advance and in writing from
the Adviser. The Board of Trustees or the Adviser may, from time to time,
make additions to and withdrawals from the assets of the Fund allocated
to you. You will determine what securities shall be purchased for such
portion of the Fund's assets, what securities shall be held or sold by
such portions of the Fund's assets, and what portion of such assets shall
be held uninvested, subject always to the provisions of the Trust's
Declaration of Trust and By-Laws and the Investment Company Act and
Investment Advisers Act and to the investment objectives, policies and
restrictions (including, without limitation, the requirements of
Subchapter M of the Internal Revenue Code of 1986, as amended (the
"Code") for qualification as a regulated investment company) of the Fund,
as each of the same shall be from time to time in effect as set forth in
the Fund's Prospectus and Statement of Additional Information, or any
investment guidelines or other instructions received in writing and in
advance from the Adviser, and subject, further, to such policies and
instructions as the Board of Trustees may from time to time establish and
deliver to you. In accordance with paragraph 5, you or your agent shall
arrange for the placing of all orders for the purchase and sale of
portfolio securities
with brokers or dealers selected by you for that portion of the Fund's
assets for which you serve as sub-investment adviser.
The Adviser shall provide you with written statements of the Declaration
of Trust; the By-Laws; the Fund's written investment objectives and
policies; the Prospectus and Statement of Additional Information and
instructions, as in effect from time to time; and you shall be fully
protected and shall have no liability for actions taken in reliance on
any such documents. You will conform your conduct to, and will ensure
that your management of the portion of the Fund's assets allocated to you
complies with, the Investment Company Act and Investment Advisers Act and
all applicable rules and regulations thereunder, the requirements for
qualification of the Fund as a regulated investment company under
Subchapter M of the Code, all other applicable federal and state laws and
regulations, and with the provisions of the Fund's Registration Statement
as amended or supplemented under the Securities Act of 1933, as amended,
and the Investment Company Act.
You shall maintain written compliance policies and procedures that you
reasonably believe are adequate to ensure that the provision or your
services hereunder are reasonably designed to prevent yourself and the
Fund from violating applicable federal securities laws. You agree to
provide the Trust and the Adviser with such reports and certifications
and with such reasonable access to your key officers and employees that
the Trust or Adviser may reasonably request for the purpose of assessing
the adequacy of your compliance policies and procedures. You agree to
promptly notify the Adviser of any failure to manage in accordance with
the Fund's investment objective, policies and guidelines or any
applicable law or regulation, including the Investment Company Act and
Subchapter M of the Code, regarding that portion of the Fund's assets
allocated to you. You also agree to notify us promptly upon detection of
any material violations of your compliance policies and procedures that
relate to the Fund or your provision of services to the Fund.
In the performance of your duties hereunder, you are and shall be an
independent contractor and unless otherwise expressly provided herein or
otherwise authorized in writing, shall have no authority to act for or
represent the Trust or the Fund in any way or otherwise be deemed to be
an agent of the Trust or the Fund or of the Adviser. You will make a
director-level employee of your firm who is qualified to discuss your
investment strategy and results in detail, and, if necessitated by the
agenda of the meeting, other qualified employees available to meet with
the Trustees and the Trust's or Adviser's officers at least semi-annually
and at such other times as the Trust or Adviser may reasonably request,
and you may agree, upon prior notice to review the investments and
investment program of the portion of the Fund's assets allocated to you.
Nothing in this Agreement shall limit or restrict the right of any of
your directors, partners, officers and/or employees who may also be a
trustee, officer or employee of 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 business, whether of a similar or a dissimilar
nature, nor limit or restrict your right to engage in any other business
or to render service of any kind to any other corporation, firm,
individual or association.
3. ALLOCATION OF CHARGES AND EXPENSES. You will bear your own costs of
providing services hereunder. You will not be required to pay any
expenses of the Fund.
4. COMPENSATION OF THE SUBADVISER. For all investment management services to
be rendered hereunder, the Adviser will pay to you a fee, as set forth in
Schedule A attached hereto, quarterly in arrears, based on a percentage
of the average of the actual net assets of the portion of the Fund that
you managed at the close of the last business day of each month within
the quarter. The net asset value of the Fund is computed in the manner
specified in the Fund's Prospectus and Statement of Additional
Information for the computation of the net assets by the Fund's
custodian. If determination of the value of net assets is suspended for
the last business day of the month, then for the purposes of this
paragraph 4, the value of the net assets of the Fund as last determined
shall
be deemed to be the value of the net assets. If the Fund's custodian
determines the value of the net assets of the Fund's portfolio more than
once on any day, the last such determination thereof on that day shall be
deemed to be the sole determination thereof on that day for the purposes
of this paragraph 4.
5. AVOIDANCE OF INCONSISTENT POSITION AND BROKERAGE. In connection with
purchases or sales of portfolio securities for the account of the portion
of the Fund allocated to you, neither you nor any of your directors,
officers, employees or affiliates will act as a principal or agent or
receive any compensation in connection with the purchase or sale of
investment securities by the Fund other than the compensation provided
for in this Agreement, except as permitted by the Investment Company Act
and approved by the Board of Trustees. You or your agent shall arrange
for the placing of all orders for the purchase and sale of portfolio
securities for the portion of the Fund's account allocated to you with
brokers or dealers selected by you. In the selection of such brokers or
dealers and the placing of such orders, you are directed at all times to
seek best execution for the Fund. It is also understood that it is
desirable for the Fund that you have access to supplemental investment
and market research and security and economic analyses provided by
certain brokers who may execute brokerage transactions at a higher cost
to the Fund than may result when allocating brokerage to other brokers on
the basis of seeking the most favorable price and efficient execution.
Therefore, you are authorized to place orders for the purchase and sale
of securities for the Fund with such certain brokers, subject to review
by the Board of Trustees from time to time with respect to the extent and
continuation of this practice. It is understood that the services
provided by such brokers may be useful to you in connection with your
services to other clients. If any occasion should arise in which you give
any advice to clients of yours concerning the Shares of the Fund, you
will act solely as investment counsel for such clients and not in any way
on behalf of the Fund.
You will advise the Trust's custodian and the Adviser on a prompt basis
of each purchase and sale of a portfolio security specifying the name of
the issuer, the description and amount or number of shares of the
security purchased, the market price, commission and gross or net price,
trade date, settlement date and identity of the effecting broker or
dealer and such other information as may be reasonably required. From
time to time as the Board of Trustees or the Adviser may reasonably
request, you will furnish to the Trust's officers and to each of its
Trustees reports as you, the Trust or the Adviser may reasonably agree.
On occasions when you deem the purchase or sale of a security to be in
the best interest of the Fund as well as other of your clients, you, to
the extent permitted by applicable laws and regulations, may, but shall
be under no obligation to, aggregate the securities to be sold or
purchased. In such event, allocation of the securities so purchased or
sold, as well as the expenses incurred in the transaction, shall be made
by you in the manner you consider to be equitable and consistent with
your fiduciary obligations to the Fund and to such other clients.
6. LIMITATION OF LIABILITY OF SUBADVISER. You shall not be liable for any
error of judgment or mistake of law or for any loss suffered by the Fund
or the Adviser in connection with the matters to which this Agreement
relates, except a loss resulting from willful misfeasance, bad faith or
gross negligence on your part or from reckless disregard by you of your
obligations and duties under this Agreement.
You shall keep the Fund's books and records to be maintained by you and
shall timely furnish to the Adviser all information relating to your
services hereunder reasonably needed by the Adviser to keep the other
books and records of the Fund required by Rule 31a-1 under the Investment
Company Act. You agree that all records which you maintain for the Fund
are the property of the Fund and you shall surrender promptly and without
any charge to the Fund any of such records required to be maintained by
you. You may retain copies of any such records to satisfy your business
and/or regulatory requirements.
7. DURATION AND TERMINATION OF THIS AGREEMENT. This Agreement shall remain
in force until October 1, 2006 and from year to year thereafter, but only
so long as such continuance, and the continuance of the Adviser as
investment adviser of the Fund, is specifically approved at least
annually in the manner prescribed in the Investment Company Act and the
rules and regulations thereunder, subject however, to such exemptions as
may be granted by the Securities and Exchange Commission by any rule,
regulation or order. This Agreement may, on 30 days' written notice, be
terminated at any time without penalties charged to the Fund, by the
Board of Trustees, by vote of a majority of the outstanding voting
securities of the Fund, by the Adviser, or by you. This Agreement will
terminate immediately upon the assignment of the investment advisory
agreement between the Adviser and the Trust, on behalf of the Fund. In
interpreting the provisions of this Agreement, the definitions contained
in Section 2(a) of the Investment Company Act (particularly the
definitions of "interested person", "assignment" and "majority of the
outstanding voting securities"), as from time to time amended, shall be
applied, subject however, to such exemptions as may be granted by the
Securities and Exchange Commission by any rule, regulations or order.
8. AMENDMENT OF THIS AGREEMENT. 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 whom enforcement of the
change, waiver, discharge or termination is sought, and no material
amendment of this Agreement shall be effective until approved by the
Board of Trustees, including a majority of the Trustees who are not
interested persons of the Adviser or you or of the Trust.
It shall be your responsibility to furnish to the Board of Trustees such
information as may reasonably be necessary in order for the Trustees to
evaluate this Agreement or any proposed amendments thereto for the
purposes of casting a vote pursuant to paragraphs 7 or 8 hereof.
9. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Ohio.
10. MISCELLANEOUS. It is understood and expressly stipulated that neither the
holders of Shares of the Trust or the Fund nor the Trustees shall be
personally liable hereunder. The name "Harbor Fund" is the designation of
the Trustees for the time being under the Declaration of Trust and all
persons dealing with the Trust or the Fund must look solely to the
property of the Trust or the Fund for the enforcement of any claims
against the Trust or the Fund as neither the Trustees, officers, agents
or shareholders assume any personal liability for obligations entered
into on behalf of the Trust or the Fund. No series of the Trust shall be
liable for any claims against any other series or assets of the Trust.
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. This Agreement may be
executed simultaneously in two or more counterparts, each of which shall
be deemed an original, but all of which together shall constitute one and
the same instrument.
11. PROHIBITION ON CONSULTING WITH OTHER SUBADVISERS. You are not permitted
to consult with any other subadviser to Harbor Fund with respect to
transactions by the Fund in securities or other assets.
12. DISCLOSURE. You do not guarantee the future performance of the assets or
any specific level of performance, the success of any investment decision
or strategy that may be used, or the success of your overall management
of the Fund. Investment decisions made hereunder are subject to various
market, currency, economic and business risks, and that those investment
decisions will not always be profitable. You will manage only the
securities, cash and other investments as allocated to you and in making
investment decisions you will not consider any other securities, cash or
other investments owned by the Fund.
13. PROXY VOTING AND OTHER LEGAL ACTIONS. You shall not vote proxies related
to securities held in the portion of the Fund under your management. Upon
request, you shall provide reasonable assistance to the Fund concerning
how any securities held in that portion of the Fund that is allocated to
you are to be voted on any issue. You will not advise the Trustees or the
Fund or act on their respective behalf in any legal proceedings,
including bankruptcies, involving securities held or previously held by
the Fund or the issuers of these securities.
