EX-99.d.13
FORM OF SUB-ADVISORY CONTRACT
Agreement made as of August 28, 2001 ("Contract") by and between
XXXXXXX PARTNERS, INC., a Delaware corporation ("Xxxxxxx Partners"), and DSI
INTERNATIONAL MANAGEMENT, INC., a Delaware corporation ("Sub-Advisor").
RECITALS
(1) Xxxxxxx Partners has entered into an Investment Advisory
Agreement ("Advisory Contract"), with Xxxxxxx Relationship
Funds, a Delaware business trust ("Trust"), and an open-end
management investment company registered with the Securities
and Exchange Commission ("SEC" or "Commission") under the
Investment Company Act of 1940, as amended ("1940 Act"), with
respect to the series of the Trust designated as the DSI
Enhanced S&P 500 Fund ("Fund");
(2) Xxxxxxx Partners wishes to retain the Sub-Advisor to furnish
certain investment advisory services to Xxxxxxx Partners with
respect to the Fund; and
(3) The Sub-Advisor is willing to furnish such services.
NOW, THEREFORE, in consideration of the premises and mutual covenants herein
contained, Xxxxxxx Partners and the Sub-Advisor agree as follows:
1. APPOINTMENT. Xxxxxxx Partners hereby appoints the Sub-Advisor as an
investment sub-advisor with respect to the Fund for the period and on the terms
set forth in this Contract. The Sub-Advisor accepts such appointment and agrees
to render the services herein set forth. The Sub-Advisor agrees that, except as
required to carry out its duties under this Contract or otherwise expressly
authorized, it is acting as an independent contractor and not as agent for the
Fund, the Trust or Xxxxxxx Partners and has no authority to act for or represent
the Fund, the Trust or Xxxxxxx Partners in any way.
2. DUTIES AS SUB-ADVISOR.
(a) Subject to the supervision and direction of the Trust's
Board of Trustees ("Board") and review by Xxxxxxx Partners, and any written
guidelines adopted by the Board or Xxxxxxx Partners and furnished to the
Sub-Advisor, the Sub-Advisor will provide a continuous investment program for
all or a designated portion of the assets of the Fund, including investment
research and discretionary management with respect to all securities and
investments and cash equivalents in the Fund. The Sub-Advisor will determine
from time to time what investments will be purchased, retained or sold by the
Fund. The Sub-Advisor will be responsible for placing purchase and sell orders
for investments and for other related transactions for the Fund. The Sub-Advisor
will be responsible for voting proxies of issuers of securities held by the
Fund. The Sub-Advisor will provide services under this Contract in accordance
with the Fund's investment objective, policies and restrictions as stated in the
Trust's currently effective registration statement under the 1940 Act, and any
amendments or supplements thereto ("Registration Statement").
(b) The Sub-Advisor agrees that, in placing orders with
brokers, it will seek to obtain the best net result in terms of price and
execution. Subject to its duty to obtain the best available prices and execution
on behalf of the Fund, the Sub-Advisor may, in its discretion, use brokers that
provide Xxxxxxx Partners or the Sub-Advisor with research, analysis, advice and
similar services to execute portfolio transactions on behalf of the Fund, and
may pay to those brokers in return for brokerage and research services a higher
commission than may be charged by other brokers, subject to the Sub-Advisor's
determining in good faith that such commission is reasonable in terms either of
the particular transaction or of the overall responsibility of the Sub-Advisor
to the Fund or its other clients and that the total commissions paid by the
Fund will be reasonable in relation to the benefits to the Fund over the long
term. Subject to its duty to obtain the best available prices and execution on
behalf of the Fund, the Sub-Advisor may, in its discretion, place orders for the
purchase and sale of portfolio securities with brokers who sell shares of the
Fund or sell shares of any other fund for which Xxxxxxx Partners or the
Sub-Advisor provide investment advisory services. Brokers who sell shares of the
funds for which Xxxxxxx Partners or the Sub-Advisor provide advisory services
shall only receive orders for the purchase and sale of portfolio securities to
the extent that the placing of such orders is in compliance with the rules of
the SEC and the National Association of Securities Dealers, Inc. In no instance
will portfolio securities be purchased from or sold to Xxxxxxx Partners or the
Sub-Advisor, or any affiliated person thereof, except in accordance with the
federal securities laws and the rules and regulations thereunder. The
Sub-Advisor may aggregate sales and purchase orders with respect to the assets
of the Fund with similar orders being made simultaneously for other accounts
advised by the Sub-Advisor or its affiliates. Whenever the Sub-Advisor
simultaneously places orders to purchase or sell the same security on behalf of
the Fund and one or more other accounts advised by the Sub-Advisor, the orders
will be allocated as to price and amount among all such accounts in a manner
believed to be equitable over time to each account. Xxxxxxx Partners recognizes
that in some cases this procedure may adversely affect the results obtained for
the Fund.
(c) In accordance with procedures adopted by the Board, as
amended from time to time, the Sub-Advisor is responsible for assisting in the
fair valuation of all portfolio securities in the Fund, in accordance with
procedures adopted by the Board, as amended from time to time. The Sub-Advisor
will use its reasonable efforts to arrange for the provision of a price from one
or more parties independent of the Sub-Advisor for each portfolio security for
which the custodian does not obtain prices in the ordinary course of business
from an automated pricing service.
(d) The Sub-Advisor will maintain all books and records
required to be maintained pursuant to the 1940 Act and the rules and regulations
promulgated thereunder with respect to transactions by the Sub-Advisor on behalf
of the Fund, and will furnish the Board and Xxxxxxx Partners with such periodic
and special reports as the Board or Xxxxxxx Partners reasonably may request. In
compliance with the requirements of Rule 31a-3 under the 1940 Act, the
Sub-Advisor hereby agrees that all records that it maintains for the Fund are
the property of the Trust, agrees to preserve for the periods prescribed by Rule
31a-2 under the 1940 Act any records that it maintains for the Trust and that
are required to be maintained by Rule 31a-1 under the 1940 Act, and further
agrees to surrender promptly to the Trust any records or copies thereof that it
maintains for the Fund upon request by the Trust.
(e) At such times as shall be reasonably requested by the
Board or Xxxxxxx Partners, the Sub-Advisor will provide the Board and Xxxxxxx
Partners with economic and investment analyses and reports as well as quarterly
reports setting forth the performance of the Fund and make available to the
Board and Xxxxxxx Partners any economic, statistical and investment services
that the Sub-Advisor normally makes available to its institutional or other
customers.
3. FURTHER DUTIES. In all matters relating to the performance of this
Contract, the Sub-Advisor will act in conformity with the Trust's Declaration of
Trust, By-laws and Registration Statement and with the written instructions and
written directions of the Board and will comply with the requirements of the
1940 Act and the Investment Advisers Act of 1940, as amended ("Advisers Act"),
and the rules under each, and all other federal and state laws and regulations
applicable to the Trust and the Fund. Xxxxxxx Partners agrees to provide to the
Sub-Advisor copies of the Trust's Declaration of Trust, By-laws, Registration
Statement, written instructions and directions of the Board and Xxxxxxx
Partners, and any amendments or supplements to any of these materials as soon as
practicable after such materials become available; and further agrees to
identify to the Sub-Advisor any broker-dealers that are affiliated with Xxxxxxx
Partners.
4. EXPENSES. During the term of this Contract, the Sub-Advisor will
bear all expenses incurred by it in connection with its services under this
Contract.
5. LIMITATION OF LIABILITY. The Sub-Advisor shall not be liable for any
error of judgment or mistake of law or for any loss suffered by the Fund, the
Trust, its shareholders or by Xxxxxxx Partners in connection with the matters to
which this Contract relates, except a loss resulting from willful misfeasance,
bad faith or gross
negligence on its part in the performance of its duties or from reckless
disregard by it of its obligations and duties under this Contract. Nothing in
this paragraph shall be deemed a limitation or waiver of any obligation or duty
that may not by law be limited or waived.
6. REPRESENTATIONS OF THE SUB-ADVISOR.
(a) The Sub-Advisor (i) is registered as an investment advisor
under the Advisers Act and will continue to be so registered for so long as this
Contract remains in effect; (ii) is not prohibited by the 1940 Act or the
Advisers Act from performing the services contemplated by this Contract; (iii)
has met and will seek to continue to meet for so long as this Contract remains
in effect, any other applicable federal or state requirements, or the applicable
requirements of any regulatory or industry self-regulatory agency necessary to
be met in order to perform the services contemplated by this Contract; (iv) has
the authority to enter into and perform the services contemplated by this
Contract; and (v) will promptly notify Xxxxxxx Partners of the occurrence of any
event that would disqualify the Sub-Advisor from serving as a sub-investment
advisor of an investment company pursuant to Section 9(a) of the 1940 Act or
otherwise.
(b) The Sub-Advisor has adopted a written code of ethics and
appropriate procedures complying with the requirements of Rule 17j-1 under the
1940 Act and has provided Xxxxxxx Partners and the Board with a copy of such
code of ethics, together with evidence of its adoption. Within thirty days of
the end of the last calendar quarter of each year that this Contract is in
effect, the president or a vice president of the Sub-Advisor shall certify to
Xxxxxxx Partners that the Sub-Advisor has complied with the requirements of Rule
17j-1 during the previous year and that there has been no material violation of
the Sub-Advisor's code of ethics or, if such a violation has occurred, that
appropriate action was taken in response to such violation. Upon the written
request of Xxxxxxx Partners, the Sub-Advisor shall permit Xxxxxxx Partners, its
employees or its agents to examine the reports required to be made by the
Sub-Advisor pursuant to Rule 17j-1 relevant to the Sub-Advisor code of ethics.
(c) The Sub-Advisor has provided Xxxxxxx Partners with a copy
of its Form ADV, as most recently filed with the SEC and promptly will furnish a
copy of all amendments to Xxxxxxx Partners at least annually.
(d) The Sub-Advisor will notify Xxxxxxx Partners of any change
of control (as defined in the 0000 Xxx) of the Sub-Advisor, including any change
of its general partners or 25% shareholders or 25% limited partners, as
applicable, and any changes in the key personnel who are either the portfolio
manager(s) of the Fund or senior management of the Sub-Advisor, in each case
prior to, or promptly after, such change.
(e) The Sub-Advisor agrees that neither it, nor any of its
affiliates, will in any way refer directly or indirectly to its relationship
with the Fund, the Trust, Xxxxxxx Partners or any of their respective affiliates
in offering, marketing or other promotional materials without the prior express
written consent of Xxxxxxx Partners.
7. SERVICES NOT EXCLUSIVE. The services furnished by the Sub-Advisor
hereunder are not to be deemed exclusive and the Sub-Advisor shall be free to
furnish similar services to others so long as its services under this Contract
are not impaired thereby or unless otherwise agreed to by the parties hereunder
in writing. Nothing in this Contract shall limit or restrict the right of any
trustee, director, officer or employee of the Sub-Advisor, 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 other business, whether of a similar nature or a dissimilar nature.
8. DURATION AND TERMINATION.
(a) This Contract shall become effective upon the day and year
first written above, provided that this Contract has been approved for the Fund
by a vote of (i) a majority of those Trustees of the Trust who are not parties
to this Contract or interested persons of any such party ("Independent
Trustees") cast in person at a meeting called for the purpose of voting on such
approval and (ii) a majority of the Fund's outstanding voting securities.
(b) Unless sooner terminated as provided herein, this Contract
shall continue in effect for two years from its effective date. Thereafter, if
not terminated, this Contract shall continue automatically for successive
periods of twelve months each, provided that such continuance is specifically
approved at least annually: (i) by a vote of a majority of Independent Trustees,
cast in person at a meeting called for the purpose of voting on such approval,
and (ii) by the Board or by vote of a majority of the outstanding voting
securities of the Fund.
(c) Notwithstanding the foregoing, with respect to the Fund,
this Contract may be terminated at any time, without the payment of any penalty,
by vote of the Board or by a vote of a majority of the outstanding voting
securities of the Fund on sixty (60) days' written notice to the Sub-Advisor.
The Contract may also be terminated, without payment of penalty, by Xxxxxxx
Partners (i) upon material breach by the Sub-Advisor of any of the
representations and warranties set forth in Paragraph 6 of this Contract, if
such breach shall not have been cured within a 20 day period after notice of
such breach or (ii) if, in the reasonable judgment of Xxxxxxx Partners, the
Sub-Advisor becomes unable to discharge its duties and obligations under this
Contract, including circumstances such as financial insolvency of the
Sub-Advisor or other circumstances that could adversely affect the Fund. The
Sub-Advisor may terminate this Contract at any time, without payment of any
penalty, on sixty (60) days' written notice to Xxxxxxx Partners. This Contract
will terminate automatically in the event of its assignment or upon termination
of the Advisory Contract as it relates to the Fund.
9. AMENDMENT OF THIS CONTRACT. No provision of this Contract 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. No amendment of this Contract as to the Fund
shall be effective until approved by vote of (i) a majority of the Trustees; and
(ii) a majority of the Fund's outstanding voting securities. Notwithstanding the
foregoing, this Contract may be amended without the approval of a majority of
the Fund's outstanding voting securities if the amendment relates solely to a
change that is permitted or not prohibited under federal law, rule, regulation
or SEC staff interpretation thereof to be made without shareholder approval.
10. GOVERNING LAW. This Contract shall be construed in accordance with
the 1940 Act and the laws of the State of New York, without giving effect to the
conflicts of laws principles thereof. To the extent that the applicable laws of
the State of New York conflict with the applicable provisions of the 1940 Act,
the latter shall control. Any question of interpretation of any term or
provision of this Contract having a counterpart in or otherwise derived from a
term or provision of the 1940 Act shall be resolved by reference to such term or
provision of the 1940 Act and to interpretations thereof, if any, by the United
States courts or, in the absence of any controlling decision of any such court,
by rules or orders of the Commission issued pursuant to the 1940 Act, or
contained in no-action and interpretive positions taken by the Commission staff.
In addition, where the effect of a requirement of the 1940 Act reflected in the
provisions of this Contract is revised by rule, order or interpretation of the
Commission or the Commission staff, such provisions shall be deemed to
incorporate the effect of such rule, order or interpretation.
11. MISCELLANEOUS. The captions in this Contract 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 Contract shall be held or made invalid by a court decision,
statute, rule or otherwise, the remainder of this Contract shall not be affected
thereby. This Contract shall be binding upon and shall inure to the benefit of
the parties hereto and their respective successors. This Contract may be signed
in counterparts.
12. NOTICES. Any notice herein required is to be in writing and is
deemed to have been given to the Sub-Advisor or Xxxxxxx Partners upon receipt of
the same at their respective addresses set forth below. All written notices
required or permitted to be given under this Contract will be delivered by
personal service, by postage mail - return receipt requested or by facsimile
machine or a similar means of same day delivery which
provides evidence of receipt (with a confirming copy by mail as set forth
herein). All notices shall be addressed as follows:
IF TO XXXXXXX PARTNERS:
Xxxx X. Xxxxxx
Secretary
Xxxxxxx Partners, Inc.
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, XX 00000-0000
IF TO THE SUB-ADVISOR:
Xxxx X. Xxxxxxxx
Executive Vice President
Chief Operating Officer
DSI International Management, Inc.
000 Xxxxxxx 0
Xxxxxxx, XX 00000
IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be executed by their duly authorized signatories as of the date and year first
above written.
XXXXXXX PARTNERS, INC. XXXXXXX PARTNERS, INC.
By: By:
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Name: Name:
Title: Title:
DSI INTERNATIONAL MANAGEMENT, INC.
By:
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Name:
Title:
Agreed to and accepted as of the day and year first above written:
XXXXXXX RELATIONSHIP FUNDS
By:
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Name:
Title:
