November 15, 1998
Kobren Insight Funds TRUST, on behalf of
Kobren Delphi Value Fund
00 Xxxxxxx Xxxxxx, Xxxxx 000
X.X. Xxx 0000
Xxxxxxxxx Xxxxx, XX 00000
Delphi Management, Inc.
00 Xxxxx Xxxxx
Xxxxxx, XX 00000
Subadvisory Agreement
Dear Sirs:
Kobren Insight Funds (the "trust"), of which Kobren Delphi Value Fund
(the "fund") is a series, has been organized as a business trust under the laws
of the Commonwealth of Massachusetts to engage in the business of an investment
company. The trust's shares of beneficial interest are currently divided into
four series (including the fund), each series representing the entire undivided
interest in a separate portfolio of assets.
The board of trustees of the trust (the "trustees") has selected Kobren
Insight Management, Inc. (the "adviser") to provide overall investment advice
and management for the fund, and to provide certain other services, under the
terms and conditions provided in the investment advisory agreement, dated as of
the date hereof, between the trust, on behalf of the fund, and the adviser (the
"investment advisory agreement").
The adviser and the trustees have selected Delphi Management, Inc. (the
"subadviser") to provide the adviser and the fund with the advice and services
set forth below, and the subadviser is willing to provide such advice and
services, subject to the review of the trustees and overall supervision of the
adviser, under the terms and conditions hereinafter set forth. The subadviser
hereby represents and warrants that it is registered as an investment adviser
under the Investment Advisers Act of 1940, as amended (the "Advisers Act").
Accordingly, the trust, on behalf of the fund, and the adviser agree with the
subadviser as follows:
1. Delivery of Documents. The trust has furnished the subadviser with copies,
properly certified or otherwise authenticated, of each of the following:
a) agreement and declaration of trust of the trust, dated September 13, 1996, as
amended to date (the "declaration of trust");
b) by-laws of the trust as in effect on the date hereof;
c) resolutions of the trustees selecting the subadviser as the
investment subadviser to the fund and approving this
subadvisory agreement (the "agreement") and resolutions
adopted by the initial shareholder of the fund approving the
investment subadvisory agreement;
d) resolutions of the trustees selecting the adviser as
investment adviser to the fund and approving the investment
advisory agreement and resolutions adopted by the initial
shareholder of the fund approving the investment advisory
agreement;
e) the adviser's investment advisory agreement;
f) the fund's prospectus and statement of additional information; and
g) the trust's code of ethics.
The adviser will furnish the subadviser from time to time with copies,
properly certified or otherwise authenticated, of all amendments of or
supplements to the foregoing, if any.
2. Investment Services. The subadviser will use its best efforts to
provide to the fund continuing and suitable investment advice with
respect to investments, consistent with the investment policies,
objectives and restrictions of the fund as set forth in the fund's
prospectus and statement of additional information. In the performance
of the subadviser's duties hereunder, subject always to the provisions
contained in the documents delivered to the subadviser pursuant to
Section 1 above, as from time to time amended or supplemented, the
subadviser will, at its own expense:
a) furnish the adviser and the fund with advice and
recommendations, consistent with the investment policies,
objectives and restrictions of the fund as set forth above,
with respect to the purchase, holding and disposition of
portfolio securities and other permitted investments;
b) furnish the adviser and the fund with advice in connection
with policy decisions to be made by the board of trustees or
any committee thereof about the fund's investments and, as
requested, furnish the fund with research, economic and
statistical data in connection with the fund's investments and
investment policies;
c) submit such reports relating to the valuation of the fund's securities as the
adviser may reasonably request;
d) subject to prior consultation with the adviser, assist the
fund in any negotiations relating to the fund's investments
with issuers, investment banking firms, securities brokers or
dealers and other institutions or investors;
e) consistent with the provisions of Section 7 of this agreement,
place orders for the purchase, sale or exchange of portfolio
securities for the fund's account with brokers or dealers
selected by the adviser or the subadviser, provided that in
connection with the placing of such orders and the selection
of such brokers or dealers the subadviser will seek to obtain
best price and execution, except as otherwise provided in the
prospectus and statement of additional information of the
fund;
f) from time to time or at any time requested by the adviser or the trustees,
make reports to the adviser or the trustees, as requested, of the subadviser's
performance of the foregoing services;
g) subject to the supervision of the adviser, maintain and
preserve the records required by the Investment Company Act of
1940 (the "1940 Act") to be maintained by the subadviser (the
subadviser agrees that such records are the property of the
trust and copies will be surrendered to the trust promptly
upon request therefor);
h) give instructions to the custodian (including any
sub-custodian) of the fund as to deliveries of securities to
and from such custodian and payments of cash for the account
of the fund, and advise the adviser on the same day such
instructions are given;
i) cooperate generally with the fund and the adviser to provide
information necessary for the preparation of registration
statements and periodic reports to be filed with the
Securities and Exchange Commission, including Form N-1A,
semi-annual reports on Form N-SAR, periodic statements,
shareholder communications and proxy materials furnished to
holders of shares of the fund, filings with states and with
United States agencies responsible for tax matters, and other
reports and filings of like nature.
In the performance of its duties hereunder, the subadviser is
and will be an independent contractor and unless otherwise
expressly provided or authorized will have no authority to
act for or represent the fund or trust in any way or
otherwise be deemed to be an agent of the fund, the trust
or of the adviser.
3. Expenses Paid by the Subadviser. The subadviser 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 that it is obligated
to provide in order to perform the services specified in Section 2, and
any other expenses incurred by it in connection with the performance of
its duties hereunder.
4. Compensation of the Subadviser. The adviser will pay the subadviser, as
compensation for services and ------------------------------- expenses assumed
hereunder, a monthly fee as set forth in Schedule A. Subadvisory fees for each
month payable hereunder will be computed daily and paid promptly after the
adviser's actual receipt of advisory fees for that month. If this agreement is
effective subsequent to the first day of the month, or if this agreement is
terminated, the fee provided in this section will be computed on the basis of
the number of days in the month for which this agreement is in effect, subject
to a pro rata adjustment based on the number of days elapsed in the current
month as a percentage of the total number of days in such month. The subadviser
understands and agrees that neither the trust nor the fund has any liability for
the subadviser's fee hereunder. Calculations of the subadviser's fee will be
based on average net asset values as provided by the adviser.
5. Other Activities of the Subadviser and Its Affiliates. Nothing herein
contained will prevent the subadviser or any of its affiliates or
associates from engaging in any other business or from acting as
investment adviser or investment manager for any other person or
entity, whether or not having investment policies or a portfolio
similar to the fund. It is specifically understood that officers,
directors and employees of the subadviser and its affiliates may engage
in providing portfolio management services and advice to other
investment advisory clients of the subadviser or of its affiliates.
6. Avoidance of Inconsistent Position. In connection with purchases or
sales of portfolio securities for the account of the fund, neither the
subadviser nor any of its directors, officers or employees will act as
principal or agent or receive any commission. The subadviser will not
knowingly recommend that the fund purchase, sell or retain securities
of any issuer in which the subadviser has a financial interest without
obtaining prior approval of the adviser prior to the execution of any
such transaction. Access persons (as defined in Rule 17j-1 under the
0000 Xxx) of the subadviser will provide personal trading reports to a
designated representative of the adviser in accordance with the trust's
code of ethics.
7. No Partnership or Joint Venture. The trust, the fund, the adviser and
the subadviser are not partners of or joint venturers with each other
and nothing herein shall be construed so as to make them such partners
or joint venturers or impose any liability as such on any of them.
8. Limitation of Liability of the Subadviser. The subadviser will not be
liable for any error of judgment or mistake of law or for any loss
suffered by the trust, 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 the subadviser's
part in the performance of its duties or from reckless disregard by it
of its obligations and duties under this agreement.
9. Duration and Termination of this Agreement. This agreement will remain in
effect until November 15, --------------------------------------------- 2000 and
from year to year thereafter, but only so long as such continuance is
specifically approved at least annually by (a) a majority of the trustees who
are not interested persons of the adviser, of the subadviser or (other than as
board members) of the trust, cast in person at a meeting called for the purpose
of voting on such approval, and (b) either (i) the trustees or (ii) a majority
of the outstanding voting securities of the fund. This agreement may, on 60
days' written notice, be terminated at any time without the payment of any
penalty by the fund by vote of a majority of the outstanding voting securities
of the fund or by the board of trustees, by the adviser or the subadviser.
Termination of this agreement with respect to the fund will not be deemed to
terminate or otherwise invalidate any provisions of any contract between you and
any other series of the trust. This agreement will automatically terminate in
the event of its assignment or upon the termination of the adviser's investment
advisory agreement. In interpreting the provisions of this Section 10, the
definitions contained in Section 2(a) of the 1940 Act (including the definitions
of "assignment," "interested person" and "voting security"), will be applied.
10. Amendment of this Agreement. No provision of this agreement may be
changed or waived orally, but only by an instrument in writing signed
by the party against which enforcement of the change or waiver is
sought. No amendment, transfer, assignment, sale, hypothecation or
pledge of this agreement will be effective until approved by (a) the
trustees, including a majority of the trustees who are not interested
persons of the adviser, the subadviser or (other than as board members)
the trust, cast in person at a meeting called for the purpose of voting
on such approval, and (b) a majority of the outstanding voting
securities of the fund, as defined in the 1940 Act.
11. Miscellaneous.
a) The captions in this agreement are included for convenience of
reference only and in no way define or limit 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.
b) The name Kobren Insight Funds (formerly Insight Premier Funds) is the
designation of the trustees under the declaration of trust, dated September 13,
1996 as amended November 20, 1996, and the declaration of trust and amendments
thereto have been filed with the Secretary of State of the Commonwealth of
Massachusetts. The obligations of the trust and the fund are not personally
binding upon, nor will resort be had to the private property of, any of the
trustees, shareholders, officers, employees or agents of the trust or the fund,
but only the fund's property will be bound. The fund will not be liable for the
obligations of any other series of the trust.
c) Nothing herein contained will limit or restrict the subadviser or any of its
officers, affiliates or employees from buying, selling or trading in any
securities for its or their own account or accounts. The trust and fund
acknowledge that the subadviser and its officers, affiliates and employees, and
its other clients may at any time have, acquire, increase, decrease or dispose
of positions in investments which are at the same time being acquired or
disposed of by the fund. The subadviser will have no obligation to acquire for
the fund a position in any investment which the subadviser, its officers,
affiliates or employees may acquire for its or their own accounts or for the
account of another client if, in the sole discretion of the subadviser, it is
not feasible or desirable to acquire a position in such investment for the fund.
Nothing herein will prevent the subadviser from purchasing or recommending the
purchase of a particular security for one or more funds or clients while other
funds or clients may be selling the same security.
d) Any information supplied by the subadviser, which is not
otherwise in the public domain, in connection with the
performance of its duties hereunder is confidential and may be
used only by the fund and/or its agents, and only in
connection with the fund and its investments.
e) Governing Law. The substantive law of the Commonwealth of Massachusetts and
the applicable provisions of the 1940 Act shall govern this agreement.
Yours very truly,
Kobren Insight Management, inc.
By: /s/ Xxxx X. Xxxxxx
Its: President
The foregoing agreement is hereby agreed to as of the date thereof.
Kobren Insight Funds
on behalf of Kobren Delphi Value Fund
By: /s/ Xxxx X. Xxxxxx
Its: President
Delphi Management, Inc.
By: /s/ Xxxxx X. Xxxxx
Its: President
SCHEDULE A
Annual Fee Rate as a Percentage
of Average Daily Net Asset Value
Kobren Delphi Value Fund 0.50%
The average net asset value for the month will be based on the net
asset value used in determining the price at which fund shares are sold,
repurchased or redeemed on each day of the month.
If this agreement becomes effective as to a fund after the first day of
a month, or terminates before the last day of a month, your compensation for
such fraction of the month will be determined by applying the foregoing
percentages to the average daily net asset value of the fund during such
fraction of a month and in the proportion that such fraction of a month bears to
the entire month.