Exhibit d(3)
SUBADVISORY AGREEMENT
AGREEMENT made as of the 29th day of June, 1999, between XXXXX MONEY
MANAGEMENT, INC., 0000 Xxxxx Xxxx, Xxxx Xxxxx Xxxxxxx, Xxxxxxx 00000
(hereinafter called the "Manager"), and HARVEST ADVISORS, INC., 00000 Xxx Xxxx
Xxxx, Xxxxx 000, Xxxxxx, Xxxxx 00000 (hereinafter called the "Subadviser").
WHEREAS, The Xxxxx Fund (the "Trust") is a Massachusetts business trust
organized with one or more series of shares, and is registered as an investment
company under the Investment Company Act of 1940, as amended (the "1940 Act");
and
WHEREAS, the Manager has entered into Investment Advisory Agreement(s)
(the "Advisory Agreement"), with the Trust, pursuant to which the Manager acts
as investment adviser to the portfolio assets of certain series of the Trust
listed on Schedule A hereto, as amended from time to time (each a "Fund" and,
collectively, the "Funds"); and
WHEREAS, the Manager desires to utilize the services of the Subadviser
as investment subadviser with respect to each Fund; and
WHEREAS, the Subadviser is willing to perform such services on the
terms and conditions hereinafter set forth:
NOW, THEREFORE, in consideration of the mutual agreements herein
contained, the parties hereto agree as follows:
1. Duties of the Subadviser. The Subadviser will serve the
Manager as investment subadviser with respect to each Fund.
(a) As investment subadviser to the Funds, the Subadviser is hereby authorized
and directed and hereby agrees, in accordance with the Subadviser's best
judgment and subject to the stated investment objectives, policies and
restrictions of the Funds as set forth in the current prospectuses and
statements of additional information of the Trust (including amendments)
and in accordance with the Trust's Declaration of Trust, as amended, and
By-laws governing the offering of its shares (collectively, the "Trust
Documents"), the 1940 Act and the provisions of the Internal Revenue Code
of 1986, as amended (the "Internal Revenue Code"), relating to regulated
investment companies, and subject to such resolutions as from time to time
may be adopted by the Trust's Board of Trustees, to render continuous
investment advice to the Manager as to the investment of each Fund's assets
in common or preferred stocks, corporate or government bonds or notes,
options, warrants, rights and other securities, based upon computer model
portfolios constructed to be compatible with the investment objectives,
policies and restrictions of the Funds as stated in the aforesaid
prospectuses. The Subadviser shall have no discretion regarding nor
responsibility for the implementation or execution of transactions which it
recommends to the Manager for any Fund, such discretion and responsibility
being solely with the Manager in the exercise of its independent judgment
regarding the appropriateness of Subadviser's investment recommendations
for the Fund in light of its investment objectives, policies and
restrictions.
(b) The Subadviser shall (i) comply with all reasonable
requests of the Trust for information, including
information required in connection with the Trust's
filings with the Securities and Exchange Commission
(the "SEC") and state securities commissions, and
(ii) provide such other services as the Subadviser
shall from time to time determine to be necessary or
useful to the administration of the Funds.
(c) The Subadviser shall furnish to the Trust's Board of
Trustees periodic reports on the performance of its
obligations under this Agreement and shall supply
such additional reports and information as the
Trust's officers or Board of Trustees shall
reasonably request.
(d) The investment advisory services provided by the
Subadviser under this Agreement are not to be deemed
exclusive and the Subadviser shall be free to render
similar services to others, as long as such services
do not impair the services rendered to the Manager or
the Trust.
2. Delivery of Documents to the Manager. The Subadviser has
furnished the Manager with copies of each of the following
documents:
(a) The Subadviser's current Form ADV and any amendments thereto;
(b) The Subadviser's most recent balance sheet; and
(c) The Code of Ethics of the Subadviser as currently in effect.
The Subadviser will furnish the Manager from time to time with
copies, properly certified or otherwise authenticated, of all
material amendments of or supplements to the foregoing, if
any. Additionally, the Subadviser will provide to the Manager
such other documents relating to its services under this
Agreement as the Manager may reasonably request on a periodic
basis. Such amendments or supplements as to items (a) through
(c) above will be provided within 30 days of the time such
materials became available to the Subadviser.
3. Expenses. The Subadviser shall pay all of its expenses arising
from the performance of its obligations under Section 1.
4. Compensation. The Manager shall pay to the Subadviser for its
services hereunder, and the Subadviser agrees to accept as
full compensation therefor, a fee with respect to each Fund as
set forth on Schedule B. If the Subadviser shall serve
hereunder for less than the whole of any payment period, the
fee hereunder shall be prorated accordingly.
5. Independent Contractor. In the performance of its duties
hereunder, the Subadviser is and shall be an independent
contractor and except as expressly provided herein or
otherwise authorized in writing, shall have no authority to
act for or represent the Trust, the Funds, any other series of
the Trust or the Manager in any way or otherwise be deemed to
be an agent of the Trust, the Funds, any other series of the
Trust or the Manager.
6. Term of Agreement. This Agreement shall continue in full force and effect
until June 29, 2001, and from year to year thereafter if such continuance
is approved in the manner required by the 1940 Act if the Subadviser shall
not have notified the Manager in writing at least 60 days prior to such
June 29 or prior to June 29 of any year thereafter that it does not desire
such continuance. This Agreement may be terminated at any time, without
payment of penalty by a Fund, by vote of the Trust's Board of Trustees or a
majority of the outstanding voting securities of the applicable Fund (as
defined by the 1940 Act), or by the Manager or by the Subadviser upon 60
days' written notice. This Agreement will automatically terminate in the
event of its assignment (as defined by the 0000 Xxx) or upon the
termination of the Advisory Agreement.
7. Amendments. This Agreement may be amended by consent of the parties hereto
provided that the consent of the applicable Fund is obtained in accordance
with the requirements of the 1940 Act.
8. Confidential Treatment. It is understood that any information or
recommendation supplied by the Subadviser in connection with the
performance of its obligations hereunder is to be regarded as confidential
and for use only by the Manager, the Trust or such persons as the Manager
may designate in connection with the Funds. It is also understood that any
information supplied to the Subadviser in connection with the performance
of its obligations hereunder, particularly, but not limited to, any list of
securities which, on a temporary basis, may not be bought or sold for the
Funds, is to be regarded as confidential and for use only by the Subadviser
in connection with its obligation to provide investment advice and other
services to the Funds.
9. Representations and Warranties. The Subadviser hereby represents and warrants
as follows:
(a) The Subadviser is registered with the SEC as an
investment adviser under the Investment Advisers Act
of 1940, as amended (the "Advisers Act"), and such
registration is current, complete and in full
compliance with all material applicable provisions of
the Advisers Act and the rules and regulations
thereunder;
(b) The Subadviser has all requisite authority to enter
into, execute, deliver and perform the Subadviser's
obligations under this Agreement;
(c) The Subadviser's performance of its obligations under
this Agreement does not conflict with any law,
regulation or order to which the Subadviser is
subject; and
(d) The Subadviser has reviewed the portion of (i) the registration statement
filed with the SEC, as amended from time to time, for the Funds
("Registration Statement"), and (ii) each Fund's prospectuses and
statements of additional information (including amendments) thereto, in
each case in the form received from the Manager with respect to the
disclosure about the Subadviser and the Funds of which the Subadviser has
knowledge ("Subadviser and Fund Information") and except as advised in
writing to the Manager such Registration Statement, prospectuses and
statements of additional information (including amendments) contain, as of
their respective dates, no untrue statement of any material fact of which
the Subadviser has knowledge and do not omit any statement of a material
fact of which the Subadviser has knowledge which was required to be stated
therein or necessary to make the statements contained therein not
misleading.
10. Covenants. The Subadviser hereby covenants and agrees that, so
long as this Agreement shall remain in effect:
(a) The Subadviser shall maintain the Subadviser's
registration as an investment adviser under the
Advisers Act, and such registration shall at all
times remain current, complete and in full compliance
with all material applicable provisions of the
Advisers Act and the rules and regulations
thereunder;
(b) The Subadviser's performance of its obligations under
this Agreement shall not conflict with any law,
regulation or order to which the Subadviser is then
subject;
(c) The Subadviser shall at all times comply with the
Advisers Act and the 1940 Act, and all rules and
regulations thereunder, and all other applicable laws
and regulations, and the Registration Statement,
prospectuses and statements of additional information
(including amendments) and with any applicable
procedures adopted by the Trust's Board of Trustees,
provided that such procedures are identified in
writing to the Subadviser;
(d) The Subadviser shall promptly notify the Manager and the Funds upon the
occurrence of any event that might disqualify or prevent the Subadviser
from performing its duties under this Agreement. The Subadviser shall
promptly notify the Manager and the Funds if there are any changes to its
organizational structure or the Subadviser has become the subject of any
adverse regulatory action imposed by any regulatory body or self-regulatory
organization. The Subadviser further agrees to notify the Manager of any
changes relating to it or the provision of services by it that would cause
the Registration Statement, prospectuses or statements of additional
information (including amendments) for the Funds to contain any untrue
statement of a material fact or to omit to state a material fact which is
required to be stated therein or is necessary to make the statements
contained therein not misleading, in each case relating to Subadviser and
Fund Information; and
(e) The Subadviser will render advice to the Manager
regarding the investment of each Fund's assets which
is consistent with maintaining the Fund's status as a
regulated investment company under Subchapter M of
the Internal Revenue Code.
11. Use of Names.
(a) The Subadviser acknowledges and agrees that the names "The Xxxxx Fund" and
"Xxxxx Money Management, Inc.," and abbreviations or logos associated with
those names, are the valuable property of the Manager and its affiliates;
that the Funds, the Manager and their affiliates have the right to use such
names, abbreviations and logos; and that the Subadviser shall use the names
"The Xxxxx Fund" and "Xxxxx Money Management, Inc.," and associated
abbreviations and logos, only in connection with the Subadviser's
performance of its duties hereunder. Further, in any communication with the
public and in any marketing communications of any sort, Subadviser agrees
to obtain prior written approval from Manager before using or referring to
"The Xxxxx Fund" and "Xxxxx Money Management, Inc.," or the Funds or any
abbreviations or logos associated with those names.
(b) The Manager acknowledges that "Harvest" and "Harvest Advisors" and
abbreviations or logos associated with those names are valuable property of
Harvest Advisors, Inc. and are distinctive in connection with investment
advisory and related services provided by the Subadviser, the "Harvest"
name is a property right of the Subadviser, and the "Harvest" and "Harvest
Advisors" names are understood to be used by each Fund upon the conditions
hereinafter set forth; provided that each Fund may use such names only so
long as the Subadviser shall be retained as the investment subadviser of
the Fund pursuant to the terms of this Agreement.
(c) The Subadviser acknowledges that each Fund and its agents may use the
"Harvest" and "Harvest Advisors" names in connection with accurately
describing the activities of the Fund, including use with marketing and
other promotional and informational material relating to the Fund with the
prior written approval always of the Subadviser. In the event that the
Subadviser shall cease to be the investment subadviser of a Fund, then the
Fund at its own or the Manager's expense, upon the Subadviser's written
request: (i) shall cease to use the Subadviser's name for any commercial
purpose; and (ii) shall use its best efforts to cause the Fund's officers
and trustees to take any and all actions which may be necessary or
desirable to effect the foregoing and to reconvey to the Subadviser all
rights which a Fund may have to such name. Manager agrees to take any and
all reasonable actions as may be necessary or desirable to effect the
foregoing and Subadviser agrees to allow the Funds and their agents a
reasonable time to effectuate the foregoing.
(d) The Subadviser hereby agrees and consents to the use
of the Subadviser's name upon the foregoing terms and
conditions.
12. Reports by the Subadviser and Records of the Funds. The
Subadviser shall furnish the Manager information and reports
necessary to the operation of the Funds, including information
required to be disclosed in the Trust's Registration
Statement, in such form as may be mutually agreed. The
Subadviser shall immediately notify and forward to both the
Manager and legal counsel for the Trust any legal process
served upon it on behalf of the Manager or the Trust.
In compliance with the requirements of Rule 31a-3 under the
1940 Act, the Subadviser agrees that all records it maintains
for the Trust are the property of the Trust and further agrees
to surrender promptly to the Trust or the Manager any such
records upon the Trust's or the Manager's request. The
Subadviser further agrees to maintain for the Trust the
records the Trust is required to maintain under Rule 31a-1(b)
insofar as such records relate to the investment affairs of
each Fund. The Subadviser further agrees to preserve for the
periods prescribed by Rule 31a-2 under the 1940 Act the
records it maintains for the Trust.
13. Indemnification. The Subadviser agrees to indemnify and hold harmless the
Manager, any affiliated person within the meaning of Section 2(a)(3) of the
1940 Act ("affiliated person") of the Manager and each person, if any, who,
within the meaning of Section 15 of the Securities Act of 1933, as amended
(the "1933 Act"), controls ("controlling person") the Manager, against any
and all losses, claims, damages, liabilities or litigation (including
reasonable legal and other expenses), to which the Manager, the Trust or
such affiliated person or controlling person may become subject under the
1933 Act, the 1940 Act, the Advisers Act, under any other statute, at
common law or otherwise, arising out of Subadviser's responsibilities as
subadviser of the Funds (1) to the extent of and as a result of the willful
misconduct, bad faith, or gross negligence of the Subadviser, any of the
Subadviser's employees or representatives or any affiliate of or any person
acting on behalf of the Subadviser, or (2) as a result of any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement, prospectuses or statements of additional
information covering the Funds or the Trust or any amendment thereof or any
supplement thereto or the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statement therein not misleading, if such a statement or omission was made
in reliance upon written information furnished by the Subadviser to the
Manager, the Trust or any affiliated person of the Manager or the Trust
expressly for use in the Trust's Registration Statement, or upon verbal
information confirmed by the Subadviser in writing expressly for use in the
Trust's Registration Statement; provided, however, that in no case is the
Subadviser's indemnity in favor of the Manager or any affiliated person or
controlling person of the Manager deemed to protect such person against any
liability to which any such person would otherwise be subject by reason of
willful misconduct, bad faith or gross negligence in the performance of its
duties or by reason of its reckless disregard of its obligations and duties
under this Agreement.
The Manager agrees to indemnify and hold harmless the
Subadviser, any affiliated person of the Subadviser and each
controlling person of the Subadviser, against any and all
losses, claims, damages, liabilities or litigation (including
reasonable legal and other expenses), to which the Subadviser
or such affiliated person or controlling person may become
subject under the 1933 Act, the 1940 Act, the Advisers Act,
under any other statute, at common law or otherwise, arising
out of the Manager's responsibilities as investment manager of
the Funds (1) to the extent of and as a result of the willful
misconduct, bad faith, or gross negligence of the Manager, any
of the Manager's employees or representatives or any affiliate
of or any person acting on behalf of the Manager, or (2) as a
result of any untrue statement or alleged untrue statement of
a material fact contained in the Registration Statement,
prospectuses or statements of additional information covering
the Funds or the Trust or any amendment thereof or any
supplement thereto or the omission or alleged omission to
state therein a material fact required to be stated therein or
necessary to make the statement therein not misleading, if
such a statement or omission was made by the Trust other than
in reliance upon written information furnished by the
Subadviser, or any affiliated person of the Subadviser,
expressly for use in the Trust's Registration Statement or
other than upon verbal information confirmed by the Subadviser
in writing expressly for use in the Trust's Registration
Statement; provided, however, that in no case is the Manager's
indemnity in favor of the Subadviser or any affiliated person
or controlling person of the Subadviser deemed to protect such
person against any liability to which any such person would
otherwise be subject by reason of willful misconduct, bad
faith or gross negligence in the performance of its duties or
by reason of its reckless disregard of its obligations and
duties under this Agreement.
14. Notices. All notices or other communications required or
permitted to be given hereunder shall be in writing and shall
be delivered or sent by pre-paid first class letter post to
the following addresses or to such other address as the
relevant addressee shall hereafter specify for such purpose to
the others by notice in writing and shall be deemed to have
been given at the time of delivery.
If to the Manager: XXXXX MONEY MANAGEMENT, INC.
0000 Xxxxx Xxxx
Xxxx Xxxxx Xxxxxxx, XX 00000
Attention: Xxxx Xxxxxxxxx
If to the Trust: THE XXXXX FUND
0000 Xxxxx Xxxx
Xxxx Xxxxx Xxxxxxx, XX 00000
Attention: Xxxx Xxxxxxxxx
If to the Subadviser: HARVEST ADVISORS, INC.
00000 Xxx Xxxx Xxxx, Xxxxx 000
Xxxxxx, Xxxxx 00000
Attention: Xxxxxxx X. Xxxxxx
15. Limitation of Liability of the Trust, its Trustees, and Shareholders. It is
understood and expressly stipulated that none of the trustees, officers,
agents, or shareholders of any series of the Trust shall be personally
liable hereunder. It is understood and acknowledged that all persons
dealing with any series of the Trust must look solely to the property of
such series for the enforcement of any claims against that series as
neither the trustees, officers, agents or shareholders assume any personal
liability for obligations entered into on behalf of any series of the
Trust. No series of the Trust shall be liable for the obligations or
liabilities of any other series of the Trust.
16. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the Commonwealth of
Massachusetts. Anything herein to the contrary
notwithstanding, this Agreement shall not be construed to
require, or to impose any duty upon either of the parties, to
do anything in violation of any applicable laws or
regulations.
17. Severability. Should any part of this Agreement be held
invalid by a court decision, statute, rule or otherwise, the
remainder of this Agreement shall not be affected thereby.
This Agreement shall be binding upon and inure to the benefit
of the parties hereto and their respective successors.
18. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, and
all such counterparts shall constitute a single instrument.
IN WITNESS WHEREOF, XXXXX MONEY MANAGEMENT, INC. AND HARVEST ADVISORS, INC.
have each caused this instrument to be signed in duplicate on its behalf by
the officer designated below thereunto duly authorized.
XXXXX MONEY MANAGEMENT, INC.
By: /S/ XXXX X. XXXXXXXXX
Title: President
HARVEST ADVISORS, INC.
By: /S/ XXXXXXX X. XXXXXX
Title: President
SCHEDULE A
TO SUBADVISORY AGREEMENT BETWEEN
XXXXX MONEY MANAGEMENT, INC. AND HARVEST ADVISORS, INC.
DATED AS OF JUNE 29, 1999
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Funds:
Xxxxx Millennium Opportunity Fund
SCHEDULE B
TO SUBADVISORY AGREEMENT BETWEEN
XXXXX MONEY MANAGEMENT, INC. AND HARVEST ADVISORS, INC.
DATED AS OF JUNE 29, 1999
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Fee schedule:
Xxxxx Millennium Opportunity Fund: The Adviser shall pay the Subadviser as
compensation for Subadviser's services to be rendered hereunder a quarterly fee
in arrears at the rate of 10% of all fees payable during the same quarter by the
Fund to the Adviser for investment advisory services provided pursuant to the
Advisory Agreement, net of any fee waivers or expense reimbursements made by the
Adviser with respect to the Fund relating to such quarter.
