SUBADVISORY AGREEMENT
This SUBADVISORY AGREEMENT ("Agreement") is made this
____ day of August, 2008, by and between Xxxx Xxxxx
Partners Fund Advisor, LLC, a Delaware limited liability
company (the "Manager"), and Xxxx Xxxxx Global Asset
Allocation, LLC, a Delaware limited liability company (the
"Subadviser").
WHEREAS, the Manager has been retained by Xxxx Xxxxx
Partners Equity Trust (the "Trust"), a Maryland business
trust registered as a management investment company under
the Investment Company Act of 1940, as amended (the "1940
Act") to provide investment advisory, management, and
administrative services to the Trust with respect to
certain series of the Trust; and
WHEREAS, the Manager wishes to engage the Subadviser to
provide certain investment advisory services to the Trust
with respect to the series of the Trust designated in
Schedule A annexed hereto (the "Fund") and Subadviser is
willing to furnish such services on the terms and
conditions hereinafter set forth;
NOW THEREFORE, in consideration of the promises and
mutual covenants herein contained, it is agreed as follows:
1. In accordance with and subject to the Management
Agreement between the Trust and the Manager with respect to
the Fund (the "Management Agreement"), the Manager hereby
appoints the Subadviser to act as Subadviser with respect
to the Fund for the period and on the terms set forth in
this Agreement. The Subadviser accepts such appointment and
agrees to render the services herein set forth, for the
compensation herein provided.
2. The Manager shall cause the Subadviser to be kept
fully informed at all times with regard to the securities
owned by the Fund, its funds available, or to become
available, for investment, and generally as to the
condition of the Fund's affairs. The Manager shall furnish
the Subadviser with such other documents and information
with regard to the Fund's affairs as the Subadviser may
from time to time reasonably request.
3. (a) Subject to the supervision of the Trust's Board
of Trustees (the "Board") and the Manager, the Subadviser
shall regularly provide the Fund with respect to such
portion of the Fund's assets as shall be allocated to the
Subadviser by the Manager from time to time (the "Allocated
Assets") with investment research, advice, management and
supervision and shall furnish a continuous investment
program for the Allocated Assets consistent with the Fund's
investment objective, policies and restrictions, as stated
in the Fund's current Prospectus and Statement of
Additional Information. The Subadviser shall, with respect
to the Allocated Assets, determine from time to time what
securities and other investments will be purchased,
retained, sold or exchanged by the Fund and what portion of
the Allocated Assets will be held in the various securities
and other investments in which the Fund invests, and shall
implement those decisions (including the execution of
investment documentation), all subject to the provisions of
the Trust's Declaration of Trust and By-Laws (collectively,
the "Governing Documents"), the 1940 Act, and the
applicable rules and regulations promulgated thereunder by
the Securities and Exchange Commission (the "SEC") and
interpretive guidance issued thereunder by the SEC staff
and any other applicable federal and state law, as well as
the investment objective, policies and restrictions of the
Fund referred to above, and any other specific policies
adopted by the Board and disclosed to the Subadviser. The
Subadviser is authorized as the agent of the Trust to give
instructions with respect to the Allocated Assets to the
custodian of the Fund and any sub-custodian or prime broker
as to deliveries of securities and other investments and
payments of cash in respect of securities transactions or
cash margin calls for the account of the Fund. Subject to
applicable provisions of the 1940 Act, the investment
program to be provided hereunder entails the investment of
all or substantially all of the assets of the Fund in one
or more investment companies. The Subadviser will place
orders pursuant to its investment determinations for the
Fund either directly with the issuer or with any broker or
dealer, foreign currency dealer, futures commission
merchant or others selected by it. In connection with the
selection of such brokers or dealers and the placing of
such orders, subject to applicable law, brokers or dealers
may be selected who also provide brokerage and research
services (as those terms are defined in Section 28(e) of
the Securities Exchange Act of 1934, as amended (the
"Exchange Act")) to the Fund and/or the other accounts over
which the Subadviser or its affiliates exercise investment
discretion. The Subadviser is authorized to pay a broker or
dealer who provides such brokerage and research services a
commission for executing a portfolio transaction for the
Fund, which is in excess of the amount of commission
another broker or dealer would have charged for effecting
that transaction, if the Subadviser determines in good
faith that such amount of commission is reasonable in
relation to the value of the brokerage and research
services provided by such broker or dealer. This
determination may be viewed in terms of either that
particular transaction or the overall responsibilities
which the Subadviser and its affiliates have with respect
to accounts over which they exercise investment discretion.
The Board may adopt policies and procedures that modify and
restrict the Subadviser's authority regarding the execution
of the Fund's portfolio transactions provided herein. The
Subadviser shall exercise voting rights, rights to consent
to corporate action and any other rights pertaining to the
Allocated Assets subject to such direction as the Board may
provide, and shall perform such other functions of
investment management and supervision as may be directed by
the Board. The Subadviser may execute on behalf of the Fund
certain agreements, instruments and documents in connection
with the services performed by it under this Agreement.
These may include, without limitation, brokerage
agreements, clearing agreements, account documentation,
futures and options agreements, swap agreements, other
investment related agreements, and any other agreements,
documents or instruments the Subadviser believes are
appropriate or desirable in performing its duties under
this Agreement.
(b) The Fund hereby authorizes any entity or person
associated with the Subadviser which is a member of a
national securities exchange to effect any transaction on
the exchange for the account of the Fund which is permitted
by Section 11(a) of the Exchange Act and Rule 11a2-2(T)
thereunder, and the Fund hereby consents to the retention
of compensation for such transactions in accordance with
Rule 11a2-2(T)(a)(2)(iv). Notwithstanding the foregoing,
the Subadviser agrees that it will not deal with itself, or
with members of the Board or any principal underwriter of
the Fund, as principals or agents in making purchases or
sales of securities or other property for the account of
the Fund, nor will the Subadviser purchase any securities
from an underwriting or selling group in which it or its
affiliates is participating, or arrange for purchases and
sales of securities between the Fund and another account
advised by the Subadviser or its affiliates, except in each
case as permitted by the 1940 Act and in accordance with
such policies and procedures as may be adopted by the Fund
from time to time, and will comply with all other
provisions of the Governing Documents and the Fund's
current Prospectus and Statement of Additional Information
relative to the Subadviser and its directors and officers.
4. The Subadviser may delegate to any other one or more
companies that the Subadviser controls, is controlled by,
or is under common control with, or to specified employees
of any such companies, certain of the Subadviser's duties
under this Agreement, provided in each case the Subadviser
will supervise the activities of each such entity or
employees thereof, that such delegation will not relieve
the Subadviser of any of its duties or obligations under
this Agreement and provided further that any such
arrangements are entered into in accordance with and meet
all applicable requirements of the 1940 Act.
5. The Subadviser agrees that it will keep records
relating to its services hereunder in accordance with all
applicable laws, and in compliance with the requirements of
Rule 31a-3 under the 1940 Act, the Subadviser hereby agrees
that any records that it maintains for the Fund are the
property of the Fund, and further agrees to surrender
promptly to the Fund any of such records upon the Fund's
request. The Subadviser further agrees to arrange for the
preservation of the records required to be maintained by
Rule 31a-1 under the 1940 Act for the periods prescribed by
Rule 31a-2 under the 1940 Act.
6. (a) The Subadviser, at its expense, shall supply the
Board, the officers of the Trust, and the Manager with all
information and reports reasonably required by them and
reasonably available to the Subadviser relating to the
services provided by the Subadviser hereunder.
(b) The Subadviser shall bear all expenses, and shall
furnish all necessary services, facilities and personnel,
in connection with its responsibilities under this
Agreement. Other than as herein specifically indicated, the
Subadviser shall not be responsible for the Fund's
expenses, including, without limitation, advisory fees;
distribution fees; interest; taxes; governmental fees;
voluntary assessments and other expenses incurred in
connection with membership in investment company
organizations; organization costs of the Fund; the cost
(including brokerage commissions, transaction fees or
charges, if any) in connection with the purchase or sale of
the Fund's securities and other investments and any losses
in connection therewith; fees and expenses of custodians,
transfer agents, registrars, independent pricing vendors or
other agents; legal expenses; loan commitment fees;
expenses relating to share certificates; expenses relating
to the issuing and redemption or repurchase of the Fund's
shares and servicing shareholder accounts; expenses of
registering and qualifying the Fund's shares for sale under
applicable federal and state law; expenses of preparing,
setting in print, printing and distributing prospectuses
and statements of additional information and any
supplements thereto, reports, proxy statements, notices and
dividends to the Fund's shareholders; costs of stationery;
website costs; costs of meetings of the Board or any
committee thereof, meetings of shareholders and other
meetings of the Fund; Board fees; audit fees; travel
expenses of officers, members of the Board and employees of
the Fund, if any; and the Fund's pro rata portion of
premiums on any fidelity bond and other insurance covering
the Fund and its officers, Board members and employees;
litigation expenses and any non-recurring or extraordinary
expenses as may arise, including, without limitation, those
relating to actions, suits or proceedings to which the Fund
is a party and the legal obligation which the Fund may have
to indemnify the Fund's Board members and officers with
respect thereto.
7. No member of the Board, officer or employee of the
Trust or Fund shall receive from the Trust or Fund any
salary or other compensation as such member of the Board,
officer or employee while he is at the same time a
director, officer, or employee of the Subadviser or any
affiliated company of the Subadviser, except as the Board
may decide. This paragraph shall not apply to Board
members, executive committee members, consultants and other
persons who are not regular members of the Subadviser's or
any affiliated company's staff.
8. As compensation for the services performed by the
Subadviser, including the services of any consultants
retained by the Subadviser, the Manager shall pay the
Subadviser out of the management fee it receives with
respect to the Fund, and only to the extent thereof, as
promptly as possible after the last day of each month, a
fee, computed daily at an annual rate set forth on Schedule
A annexed hereto. The first payment of the fee shall be
made as promptly as possible at the end of the month
succeeding the effective date of this Agreement, and shall
constitute a full payment of the fee due the Subadviser for
all services prior to that date. If this Agreement is
terminated as of any date not the last day of a month, such
fee shall be paid as promptly as possible after such date
of termination, shall be based on the average daily net
assets of the Fund or, if less, the portion thereof
comprising the Allocated Assets in that period from the
beginning of such month to such date of termination, and
shall be that proportion of such average daily net assets
as the number of business days in such period bears to the
number of business days in such month. The average daily
net assets of the Fund or the portion thereof comprising
the Allocated Assets shall in all cases be based only on
business days and be computed as of the time of the regular
close of business of the New York Stock Exchange, or such
other time as may be determined by the Board.
9. The Subadviser assumes no responsibility under this
Agreement other than to render the services called for
hereunder, in good faith, and shall not be liable for any
error of judgment or mistake of law, or for any loss
arising out of any investment or for any act or omission in
the execution of securities transactions for the Fund,
provided that nothing in this Agreement shall protect the
Subadviser against any liability to the Manager or the Fund
to which the Subadviser would otherwise be subject by
reason of willful misfeasance, bad faith, or gross
negligence in the performance of its duties or by reason of
its reckless disregard of its obligations and duties
hereunder. As used in this Section 9, the term "Subadviser"
shall include any affiliates of the Subadviser performing
services for the Trust or the Fund contemplated hereby and
the partners, shareholders, directors, officers and
employees of the Subadviser and such affiliates.
10. Nothing in this Agreement shall limit or restrict
the right of any director, officer, or employee of the
Subadviser who may also be a Board member, officer, or
employee of the Trust or the Fund, to engage in any other
business or to devote his time and attention in part to the
management or other aspects of any other business, whether
of a similar nature or a dissimilar nature, nor to limit or
restrict the right of the Subadviser to engage in any other
business or to render services of any kind, including
investment advisory and management services, to any other
fund, firm, individual or association. If the purchase or
sale of securities consistent with the investment policies
of the Fund or one or more other accounts of the Subadviser
is considered at or about the same time, transactions in
such securities will be allocated among the accounts in a
manner deemed equitable by the Subadviser. Such
transactions may be combined, in accordance with applicable
laws and regulations, and consistent with the Subadviser's
policies and procedures as presented to the Board from time
to time.
11. For the purposes of this Agreement, the Fund's "net
assets" shall be determined as provided in the Fund's then-
current Prospectus and Statement of Additional Information
and the terms "assignment," "interested person," and
"majority of the outstanding voting securities" shall have
the meanings given to them by Section 2(a) of the 1940 Act,
subject to such exemptions as may be granted by the SEC by
any rule, regulation or order.
12. This Agreement will become effective with respect
to the Fund on the date set forth opposite the Fund's name
on Schedule A annexed hereto, provided that it shall have
been approved by the Trust's Board and, if so required by
the 1940 Act, by the shareholders of the Fund in accordance
with the requirements of the 1940 Act and, unless sooner
terminated as provided herein, will continue in effect
through August __, 2010. Thereafter, if not terminated,
this Agreement shall continue in effect with respect to the
Fund, so long as such continuance is specifically approved
at least annually (i) by the Board or (ii) by a vote of a
majority of the outstanding voting securities of the Fund,
provided that in either event the continuance is also
approved by a majority of the Board members who are not
interested persons of any party to this Agreement, by vote
cast in person at a meeting called for the purpose of
voting on such approval.
13. This Agreement is terminable with respect to the
Fund without penalty by the Board or by vote of a majority
of the outstanding voting securities of the Fund, in each
case on not more than 60 days' nor less than 30 days'
written notice to the Subadviser, or by the Subadviser upon
not less than 90 days' written notice to the Fund and the
Manager, and will be terminated upon the mutual written
consent of the Manager and the Subadviser. This Agreement
shall terminate automatically in the event of its
assignment by the Subadviser and shall not be assignable by
the Manager without the consent of the Subadviser.
14. The Subadviser agrees that for any claim by it
against the Fund in connection with this Agreement or the
services rendered under this Agreement, it shall look only
to assets of the Fund for satisfaction and that it shall
have no claim against the assets of any other series of the
Trust.
15. 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 which
enforcement of the change, waiver, discharge or termination
is sought, and no material amendment of the Agreement shall
be effective until approved, if so required by the 1940
Act, by vote of the holders of a majority of the Fund's
outstanding voting securities.
16. This Agreement, and any supplemental terms
contained on Annex I hereto, if applicable, embodies the
entire agreement and understanding between the parties
hereto, and supersedes all prior agreements and
understandings relating to the subject matter hereof.
Should any part of this Agreement be held or made invalid
by a court decision, statute, rule or otherwise, the
remainder of this Agreement shall not be affected thereby.
This Agreement shall be binding on and shall inure to the
benefit of the parties hereto and their respective
successors.
17. This Agreement shall be construed and the
provisions thereof interpreted under and in accordance with
the laws of the State of New York.
[signature page to follow]
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their officers thereunto duly
authorized.
XXXX XXXXX
PARTNERS FUND
ADVISOR, LLC
By:
_________________
_________________
_____
Name:
Title:
XXXX XXXXX GLOBAL
ASSET ALLOCATION,
LLC
By:
_________________
_________________
____
Name:
Title:
The foregoing is acknowledged:
The undersigned officer of the Trust has executed this
Agreement not individually but in his/her capacity as an
officer of the Trust. The Trust does not hereby undertake,
on behalf of the Fund or otherwise, any obligation to the
Subadviser.
XXXX XXXXX
PARTNERS EQUITY
TRUST
By:
_________________
_________________
_________
Name:
Title:
ANNEX I
Not applicable.
SCHEDULE A
Xxxx Xxxxx Partners Target Retirement 2045
Date:
August __, 2008
Fee:
None.
1521593.1
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