SUB-ITEM 77Q1(E)(5): NEW INVESTMENT SUB-ADVISORY CONTRACT
GE INVESTMENTS FUNDS, INC.
SMALL-CAP EQUITY FUND
SUB-ADVISORY AGREEMENT
This agreement ("Agreement") is made as of July 1, 2016, by and among SSGA
FUNDS MANAGEMENT, INC. ("SSGA FM"), a Massachusetts corporation, GE INVESTMENTS
FUNDS, INC., a Virginia corporation ("Company"), on behalf of the SMALL-CAP
EQUITY FUND ("Fund"), a series of the Company, solely with respect to
Section 12(b) of this Agreement, and GLOBEFLEX CAPITAL, L.P., a California
limited partnership ("Sub-Adviser").
RECITALS
WHEREAS, SSGA FM has entered into an Investment Advisory and Administration
Agreement dated July 1, 2016 ("Advisory Agreement") with the Company, an
open-end management investment company registered under the Investment Company
Act of 1940, as amended ("1940 Act"), with respect to the Fund, a series of the
Company;
WHEREAS, pursuant to the Advisory Agreement, SSGA FM is authorized to
delegate its investment advisory responsibilities to other investment advisers,
subject to the requirements of the 1940 Act;
WHEREAS, SSGA FM wishes to retain the Sub-Adviser to furnish certain
investment advisory services to SSGA FM and the Fund, and the Sub-Adviser is
willing to furnish those services;
WHEREAS, subject to the approval of the Fund's Board of Directors, SSGA FM
may retain additional sub-advisers to furnish similar investment advisory
services to SSGA FM and the Fund, and may at its sole discretion, allocate the
Fund's assets among the Fund's sub-advisers to be managed in accordance with
their respective sub-advisory agreements;
WHEREAS, SSGA FM intends that this Agreement will become effective when
approved in accordance with Section 15 of the 1940 Act; and
NOW, THEREFORE, in consideration of the promises and mutual covenants herein
contained, the parties agree as follows:
1. Appointment.
SSGA FM hereby appoints the Sub-Adviser as an investment sub-adviser to the
Fund for the period and on the terms set forth in this Agreement. The
Sub-Adviser accepts that appointment and agrees to render the services herein
set forth, for the compensation herein provided. The Sub-Adviser further
acknowledges and agrees that such appointment as an investment sub-adviser to
the Fund is limited to those Fund assets allocated to the Sub-Adviser by SSGA
FM, which may be changed from time to time at the sole discretion of SSGA FM
("Allocated Assets"). The Sub-Adviser shall for all purposes herein be deemed
to be an independent contractor and shall, except as expressly provided or
authorized, have no authority to act for or represent the Company, the Fund or
SSGA FM in any way or otherwise be deemed an agent of the Company, the Fund or
SSGA FM.
2. Duties as Sub-Adviser.
(a) Subject to the oversight and supervision of SSGA FM and the Board of
Directors of the Company (the "Board"), the Sub-Adviser will provide a
continuous investment program for the Fund with respect to the Sub-Adviser's
Allocated Assets, including investment research and management. The Sub-Adviser
will determine from time to time what investments will be purchased, retained
or sold by the Fund with respect to such Allocated Assets. The Sub-Adviser will
be responsible for placing purchase and sell orders for the Allocated Assets.
The Sub-Adviser will consult with SSGA FM from time to time regarding matters
pertaining to the Fund, including market strategy and portfolio
characteristics. The SubAdviser will provide services under this Agreement in
accordance with the Fund's investment objective, policies and restrictions as
stated in the Registration Statement (as defined below), the Constituent
Documents (as defined below), the Investment Guidelines (as defined below), and
applicable law. In this connection and in connection with the further duties
set forth in this Section 2 as provided below, the Sub-Adviser shall provide
SSGA FM and the Board with such periodic reports and documentation as SSGA FM
or the Board shall reasonably request regarding the Sub-Adviser's management of
the Fund's Allocated Assets, compliance with applicable laws and rules and the
Registration Statement and all requirements hereunder. The Sub-Adviser
acknowledges that copies of the Company's current registration statement on
Form N-1A and any amendments or supplements thereto ("Registration Statement"),
and the Company's Amended and Restated Articles of Incorporation and By-Laws,
if any ("Constituent Documents"), each as currently in effect, have been
delivered to the Sub-Adviser.
(b) The Sub-Adviser shall carry out its responsibilities under this
Agreement in compliance with: (i) the Fund's investment objective, policies and
restrictions as set forth in the Registration Statement, (ii) the Constituent
Documents, (iii) all investment guidelines, policies, procedures or directives
of the Company or SSGA FM as provided to the Sub-Adviser ("Investment
Guidelines"), (iv) the 1940 Act and the rules promulgated thereunder, (v) the
Investment Advisers Act of 1940, as amended ("Advisers Act"), and the rules
promulgated thereunder, and (vi) other applicable federal and state laws and
related regulations. To the extent that the Investment Guidelines applicable to
the Sub-Adviser's Allocated Assets are inconsistent with the investment
restrictions applicable to the Fund's total assets as set forth in the
Registration Statement, the Sub-Adviser shall comply with the policies,
procedures and directives as set forth in the Investment Guidelines. SSGA FM
shall promptly notify the Sub-Adviser of changes to (i), (ii) or (iii) above
and shall consult with Sub-Adviser before making any changes relating solely to
the Fund's investment objective, policies and restrictions as set forth in the
Registration Statement, as well as to the policies, procedures and directives
set forth in the Investment Guidelines. In particular, the Sub-Adviser shall
take all actions necessary with respect to the Allocated Assets, as if they
were the Fund itself, to ensure that the Allocated Assets, if they were the
Fund, would: (A) satisfy the asset diversification requirements set forth under
Section 851(b)(3) of sub-chapter M of the Internal Revenue Code of 1986, as
amended ("Code"), and the Treasury Regulations thereunder ("Regulations"),
(B) satisfy the gross income
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qualification requirements as set forth under Section 851(b)(2) of the Code and
Regulations, and (C) comply with the diversification requirements of
Section 817(h) of the Code and Regulations [as these apply to separate accounts
through which variable life insurance contracts and variable annuity contracts
are issued]. For purposes of determining whether the Allocated Assets satisfy
the requirements set forth in the preceding sentence, the Allocated Assets will
be deemed not to be a member of any controlled group or otherwise to have any
affiliates, and the SubAdviser shall have no obligation to consider the
holdings or investments of any of the Fund's or its affiliates' assets or
accounts other than the Allocated Assets.
(c) The Sub-Adviser shall take all actions which it considers necessary to
implement the investment objectives and policies of the Fund, and in
particular, to place all orders for the purchase or sale of securities or other
investments for the Fund's Allocated Assets with brokers or dealers selected by
it. For that limited purpose, the Sub-Adviser is authorized as the agent of the
Company to give instructions to the Company's custodian(s) as to deliveries of
securities or other investments and payments of cash for the account of the
Fund. In connection with the selection of brokers or dealers and the placing of
purchase and sale orders with respect to investments of the Fund, the
Sub-Adviser is directed at all times to seek to obtain best execution and price
within the policy guidelines determined by the Board and set forth in the
Registration Statement.
In addition to-seeking the best price and execution, to the extent covered
by Section 28(e) of the Securities Exchange Act of 1934, as amended (the "1934
Act"), and applicable guidance of the Securities and Exchange Commission (the
"SEC"), the Sub-Adviser is also authorized to take into consideration other
relevant factors which may include, without limitation: (i) the execution
capabilities of such brokers and dealers, (ii) research, brokerage and other
services provided by brokers and dealers which the Sub-Adviser believes will
enhance its general portfolio management capabilities, (iii) the size of the
transaction, (iv) the difficulty of execution, (v) the operational facilities
of such brokers and dealers, (vi) the risk to such a broker or dealer of
positioning a block of securities, and (vii) the overall quality of brokerage
and research services provided by such brokers and dealers. The Sub-Adviser is
also authorized to effect individual securities transactions at commission
rates in excess of the minimum commission rates available, if it 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,
viewed in terms of either that particular transaction or the Sub-Adviser's
overall responsibilities with respect to the Fund. The policies with respect to
brokerage allocation, determined from time to time by the Board, are those
disclosed in the Registration Statement. The Sub-Adviser will periodically
evaluate the statistical data, research and other investment services provided
to it by brokers and dealers. Such services may be used by the Sub-Adviser in
connection with the performance of its obligations under this Agreement or in
connection with other advisory or investment operations including using such
information in managing its own accounts. Whenever the Sub-Adviser
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-Adviser, the orders
will, to the extent practicable, be allocated as to price and amount among all
such accounts in a manner believed to be equitable by the Sub-Adviser to each
account and otherwise in accordance with the Sub-Adviser's procedures approved
by the Board.
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(d) Only with prior written consent from SSGA FM and subject to: (i) the
requirement that the Sub-Adviser seek to obtain best execution and price within
the policy guidelines determined by the Board and set forth in the Registration
Statement, (ii) the provisions of the 1940 Act and the Advisers Act, (iii) the
provisions of the 1934 Act, and (iv) other applicable provisions of law, the
Sub-Adviser or an affiliated person of the SubAdviser or of SSGA FM may act as
broker for the Fund in connection with the purchase or sale of securities or
other investments for the Fund. Such brokerage services are not within the
scope of the duties of the Sub-Adviser under this Agreement. Subject to the
requirements of applicable law and any procedures adopted by the Board, the
Sub-Adviser or its affiliated persons may receive brokerage commissions, fees
or other remuneration from the Fund or the Company for such services in
addition to the Sub-Adviser's fees for services under this Agreement.
(e) The Sub-Adviser shall maintain, in the form and for the periods required
by Rule 31a-2 under the 1940 Act, all records relating to the Fund's
investments that are required to be maintained by the Company pursuant to the
requirements of Rule 31a-1 under the 1940 Act. The SubAdviser agrees that all
books and records which it maintains for the Fund or the Company are the
property of the Company and further agrees to surrender the same to SSGA FM or
the Company upon SSGA FM's or the Company's request (provided, however, that
Sub-Adviser may retain copies of such records). The Sub-Adviser agrees to
furnish the Board and SSGA FM with such periodic and special reports regarding
the Fund's investments and records relating to the same as the Board or SSGA FM
reasonably may request. Further, the Sub-Adviser shall permit the books and
records maintained with respect to the Fund to be inspected and audited by the
Company, SSGA FM or their respective agents at all reasonable times during
normal business hours upon reasonable notice.
(f) At such times as shall reasonably be requested, the Sub-Adviser will
provide to the Board and SSGA FM economic and investment analyses and reports
relating to the Allocated Assets, information regarding the Sub-Adviser
required to be included in the Registration Statement and information necessary
for SSGA FM and the Board to review the Fund or discuss the management of it.
The Sub-Adviser will provide quarterly reports setting forth the Fund's
performance with respect to the Allocated Assets and the Sub-Adviser's private
account composite performance and will complete on a quarterly basis the
checklist provided to it by SSGA FM regarding the Fund's investments and
transactions. The Sub-Adviser shall make available to the Board and SSGA FM any
economic, statistical and investment services normally available to
institutional or other customers of the Sub-Adviser. The Sub-Adviser will make
available its officers and employees to meet with the Board on reasonable
notice to review the Fund's investments.
(g) In accordance with procedures adopted by the Board, as amended from time
to time, the Sub-Adviser is responsible for assisting the Board in determining
the fair valuation of any illiquid portfolio securities held within the
Allocated Assets and will assist the Company's accounting services agent or
SSGA FM to obtain independent sources of market value for all other portfolio
securities.
Further, the Sub-Adviser shall promptly notify the Fund and/or SSGA FM, but
in any event on the same day and prior to the earlier of (1) the release of the
Fund's net asset value or (2) 6:00pm Eastern Time, of any and all instances in
which the Sub-Adviser knows or should
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have reason to know that the market quoted price or value of a portfolio
security does not represent the "fair value" of the instrument (i.e., the price
at which that instrument could be acquired or sold in an arm's-length
transaction between unrelated parties in which each party acts knowledgeably,
prudently and without compulsion) or that there is no market price or value
available from any source with respect to a particular instrument and that such
instrument should accordingly be subject to a fair valuation determination in
accordance with procedures adopted by the Board, as amended from time to time.
(h) At such times as shall be reasonably requested by SSGA FM, the
Sub-Adviser shall review and certify in writing that the information stated in
the Company's Registration Statement relating to the Sub-Adviser, its
management of the Fund with respect to the Allocated Assets, including
investment objectives, strategies and related risks, and its performance
history is and will continue to be true, correct and complete to the best of
its knowledge.
(i) The Sub-Adviser will promptly notify SSGA FM of any change of control of
the Sub-Adviser, including any change of its general partners or 25%
shareholders or members, as applicable, and any changes in the key personnel of
the Sub-Adviser, including without limitation, any change in the portfolio
management personnel responsible for the Allocated Assets, in each case prior
to or promptly after such change. Notwithstanding the foregoing, the
Sub-Adviser will promptly notify SSGA FM of any existing agreement, or upon
entering into any agreement, that may result in a change of control of the
Sub-Adviser, including without limitation the retention of an agent to assist
in the sale of all, or a significant portion, of the business of the
Sub-Adviser.
(j) The Sub-Adviser will calculate its private account composite performance
in compliance with the Global Investment Performance Standards of the CFA
Institute Centre for Financial Market Integrity and such performance will be
reviewed or verified at least annually by an independent firm providing
performance verification services.
(k) Unless SSGA FM gives the Sub-Adviser written instructions to the
contrary, the Sub-Adviser shall, in accordance with the Sub-Adviser's proxy
voting policies and procedures (as they may be amended from time to time), vote
proxies in the best interests of the Fund as may be necessary or advisable in
connection with any matters submitted to a vote of the shareholders of an
issuer held by the Fund and shall provide SSGA FM with its proxy voting
procedures and guidelines and any amendments thereto.
3. Expenses.
During the term of this Agreement, the Sub-Adviser will bear all expenses
incurred by it in connection with its investment sub-advisory services under
this Agreement.
4. Supplemental Arrangements
The Sub-Adviser may enter into arrangements with other persons affiliated
with the Sub-Adviser to better enable it to fulfill its obligations under this
Agreement for the provision of certain personnel and facilities to the
Sub-Adviser, other than the brokerage services provided in Section 2(d) herein.
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5. Prohibited Conduct
In providing the services described in this Agreement, the Sub-Adviser will
not consult with any other investment advisory firm that provides investment
advisory services to any investment company sponsored by SSGA FM, including the
Fund, regarding transactions in portfolio securities or other portfolio
investments of the Fund.
6. Compensation.
For the services rendered, the facilities furnished and the expenses assumed
by the Sub-Adviser, SSGA FM shall pay the Sub-Adviser no later than the
ninetieth (90th) day following the end of each calendar quarter, a fee based on
the net assets attributable to the aggregate Allocated Assets of the small-cap
equity funds managed by SSGA FM and sub-advised by the Sub-Adviser, as provided
in Schedule A to the Agreement.
7. Compliance Matters
(a) The Sub-Adviser understands and agrees that it is a "service provider"
to the Company as contemplated by Rule 38a-1 under the 1940 Act. As such, the
Sub-Adviser agrees to cooperate fully with SSGA FM and the Company and its
directors and officers, including the Company's Chief Compliance Officer
("CCO"), with respect to all compliance-related matters, including the
Company's efforts to assure that each of its service providers adopts and
maintains written policies and procedures that are reasonably designed to
prevent violation of the "federal securities laws" (as that term is defined by
Rule 38a-1) by the Company, SSGA FM and Sub-Adviser. In this regard, the
Sub-Adviser shall:
(i) submit to the Board for its consideration and approval, the
Sub-Adviser's applicable compliance policies and procedures;
(ii) submit to the Board for its consideration and approval, annually
(and at such other times as the Company may reasonably request), a written
report ("Report") fully describing the results of the Sub-Adviser's review
of the adequacy of its compliance policies and procedures, including its
assessment of the effectiveness of such policies and procedures and a
description of any material amendments to such policies and procedures since
the more recent of: (A) the Board's approval of such policies and procedures
or (B) the most recent Report;
(iii) provide periodic reports discussing the Sub-Adviser's compliance
program and special reports in the event of material compliance matters;
(iv) permit SSGA FM and the Company and its directors and officers to
become familiar with the Sub-Adviser's operations and any aspects of the
Sub-Adviser's operations that is reasonably likely expose SSGA FM and the
Company to compliance risks or lead to a violation by the Company, SSGA FM
or the Sub-Adviser of the federal securities laws;
(v) provide SSGA FM, the Company and its directors and CCO with such
certifications regarding compliance as may be reasonably requested; and
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(vi) make the Sub-Adviser's personnel and compliance policies and
procedures reasonably available to such personnel as SSGA FM and the Company
and its directors and officers may designate to evaluate the effectiveness
of the Sub-Adviser's compliance controls, policies and procedures.
(b) The Sub-Adviser agrees to maintain and implement a compliance program
that complies with the requirements of Rule 206(4)-7 under the Advisers Act.
8. Representations and Warranties of Sub-Adviser.
The Sub-Adviser represents, warrants and agrees as follows:
(a) The Sub-Adviser (i) is registered as an investment adviser under the
Advisers Act and will continue to be so registered for so long as this
Agreement remains in effect; (ii) is not prohibited by the 1940 Act or the
Advisers Act from performing the services contemplated by this Agreement;
(iii) has met, and will seek to continue to meet for so long as this Agreement
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
Agreement; (iv) has the authority to enter into and perform the services
contemplated by this Agreement and the execution, delivery and performance by
the Sub-Adviser of this Agreement does not contravene or constitute a default
under any agreement binding upon the Sub-Adviser; (v) will promptly notify SSGA
FM of the occurrence of any event that would disqualify it from serving as an
investment adviser of an investment company pursuant to Section 9(a) of the
1940 Act or otherwise; (vi) has filed a notice of exemption pursuant to Rule
4.14 under the Commodity Exchange Act with the Commodity Futures Trading
Commission and the National Futures Association, or is not required to file
such exemption; and (vii) is duly organized and validly existing under the laws
of the state in which it was organized with the power to own and possess its
assets and carry on its business as it is now being conducted.
(b) The Sub-Adviser has adopted a written code of ethics pursuant to Rule
204A-1 under the Advisers Act that also complies with Rule 17j-1 under the 1940
Act (the "Code"), and will provide SSGA FM and the Board with a copy of that
code of ethics. Within fifteen (15) days of the end of the last calendar
quarter of each year that this Agreement is in effect, the president, any vice
president or chief compliance officer of the SubAdviser shall certify to SSGA
FM that the Sub-Adviser (i) has complied with the requirements of Rule 204A-1
under the Advisers Act and Rule 17j-1 under the 1940 Act during the previous
year and that there has been no violation of the Sub-Adviser's code of ethics
or, if such a violation has occurred, the details of such violation and of
the-action that was taken in response to such violation and (ii) has adopted
procedures reasonably designed to prevent Access Persons (as defined in Rule
17j-1) from violating the federal securities laws. On an annual basis, the
Sub-Adviser shall provide a written report to the Board and SSGA FM pursuant to
Rule 17j-1(c)(2) under the 1940 Act, and upon a reasonable written request from
SSGA FM, furnish to SSGA FM all other records relevant to the Sub-Adviser's
code of ethics as it relates to this Agreement.
(c) The Sub-Adviser certifies that the information stated in the currently
effective Post-Effective Amendment to the Company's Registration Statement
relating to the Sub-Adviser,
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its management of the Fund with respect to the Allocated Assets and its
performance history is and will continue to be true, correct and complete to
the best of its knowledge.
(d) The Sub-Adviser will use commercially reasonable efforts to provide SSGA
FM with a minimum investment management capacity of [treated as confidential]
in the aggregate, to provide investment advisory services on behalf of the
small-cap equity mutual funds (including the Fund) managed by SSGA FM and
sub-advised by the Sub-Adviser, provided that this provision shall in no way
limit or restrict the Sub-Adviser's right to terminate this Agreement or any
other investment management or subadvisory agreement between the Sub-Adviser
and SSGA FM pursuant to the terms of each such agreement.
9. Representations and Warranties of SSGA FM.
(a) SSGA FM represents, warrants and agrees that SSGA FM (i) is registered
as an investment adviser under the Advisers Act and will continue to be so
registered for so long as this Agreement remains in effect; (ii) is not
prohibited by the 1940 Act or the Advisers Act from performing the obligations
contemplated by this Agreement; (iii) has met, and will seek to continue to
meet for so long as this Agreement 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
obligations contemplated by this Agreement; (iv) has the authority to enter
into and perform the obligations contemplated by this Agreement and the
execution, delivery and performance by SSGA FM of this Agreement does not
contravene or constitute a default under any agreement binding upon SSGA FM;
(v) will promptly notify the Sub-Adviser of the occurrence of any event that
would disqualify SSGA FM from serving as an investment adviser of an investment
company pursuant to Section 9(a) of the 1940 Act or otherwise; (vi) has filed a
notice of exemption pursuant to Rule 4.14 under the Commodity Exchange Act with
the Commodity Futures Trading Commission and the National Futures Association,
or is not required to file such exemption; and (vii) is duly organized and
validly existing under the Laws of the Commonwealth of Massachusetts with the
power to own and possess its assets and carry on its business as it is now
being conducted.
(b) SSGA FM certifies that the information stated in the currently effective
Post-Effective Amendment to the Company's Registration Statement relating to
SSGA FM, its management of the Fund and its performance history is and will
continue to be true, correct and complete to the best of its knowledge.
10.Duty to Update Information.
The parties hereto shall promptly notify each other in writing regarding any
change to the foregoing representations and warranties. Likewise, the
Sub-Adviser agrees to notify SSGA FM of any change of control of Sub-Adviser,
including any change of its general partner or 25% shareholders, as applicable,
and any changes in the key personnel of the Sub-Adviser, including in
particular portfolio management personnel responsible for the Allocated Assets
of the Fund, in each case prior to or promptly after notice of such change.
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11.Limitation Of Liability.
The Sub-Adviser shall not be liable to the Fund or the Company or SSGA FM
for any loss suffered by the Fund, the Company or its shareholders or by SSGA
FM in connection with the matters to which this Agreement relates, except (a) 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 Agreement, and (b) to the extent otherwise
provided in Section 36(b) of the 1940 Act concerning loss resulting from a
breach of fiduciary duty with respect to the receipt of compensation for
services. Notwithstanding the foregoing, Sub-Adviser shall be liable for any
loss suffered by the Fund, the Company or its shareholders or by SSGA FM as a
result of any negligent act or omission by Sub-Adviser relating to or arising
out of any breach by the Sub-Adviser of the second paragraph of Section 2(g) of
this Agreement.
12.Indemnification.
(a) SSGA FM agrees to indemnify and hold the Sub-Adviser, its officers and
directors, and any person who controls the Sub-Adviser within the meaning of
Section 15 of the Securities Act of 1933, as amended ("1933 Act") harmless from
any and all direct or indirect liabilities, losses or damages (including
reasonable attorneys' fees) arising out of any claim, demand, action, suit or
proceeding arising out of:
(i) SSGA FM's breach of its duties under this Agreement; or
(ii) any bad faith, willful misfeasance, reckless disregard or gross
negligence on the part of SSGA FM or any of its directors, officers or
employees in the performance of SSGA FM's duties and obligations under this
Agreement, except to the extent such loss results from the SubAdviser's own
willful misfeasance, bad faith, reckless disregard or gross negligence in
the performance of Sub-Adviser's duties and obligations under this Agreement.
(b) The Company agrees to indemnify and hold the Sub-Adviser, its officers
and directors, and any person who controls the Sub-Adviser within the meaning
of Section 15 of the 1933 Act harmless from any and all direct or indirect
liabilities, losses or damages (including reasonable attorneys' fees) arising
out of any claim, demand, action, suit or proceeding arising out of any
misrepresentation of a material fact or the omission of a fact necessary to
make information not misleading in the Registration Statement, any proxy
statement, or any annual or semi-annual report to investors in the Fund (other
than a misstatement or omission relating to disclosure about the Sub-Adviser
approved by the Sub-Adviser or provided to SSGA FM or the Company by the
Sub-Adviser or relating to an incorrect valuation of a Fund portfolio security
that resulted from any breach by the Sub-Adviser of the second paragraph of
Section 2(g) of this Agreement).
(c) The Sub-Adviser agrees to indemnify and hold SSGA FM, its officers and
directors, and any person who controls SSGA FM within the meaning of Section 15
of the 1933 Act, and the Company, its officers and directors, and any person
who controls the Company or any Fund within the meaning of Section 15 of the
1933 Act, harmless from any and all direct or indirect liabilities, losses or
damages (including reasonable attorneys' fees) arising out of any claim,
demand, action, suit or proceeding arising out of:
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(i) any misrepresentation of a material fact or the omission of a fact
necessary to make information not misleading in the Registration Statement,
any proxy statement, or any annual or semi-annual report to investors in the
Fund relating to disclosure about the Sub-Adviser approved by the
Sub-Adviser or provided to SSGA FM or the Company by the Sub-Adviser or
relating to an incorrect valuation of a Fund portfolio security that
resulted from any breach by the Sub-Adviser of the second paragraph of
Section 2(g) of this Agreement;
(ii) Sub-Adviser's breach of its duties under this Agreement; or
(iii) any bad faith, willful misfeasance, reckless disregard or gross
negligence on the part of the Sub-Adviser or any of its directors, officers
or employees in the performance of the Sub-Adviser's duties and obligations
under this Agreement, except to the extent such loss results from the
Company's or SSGA FM's own willful misfeasance, bad faith, reckless
disregard or gross negligence in the performance of their respective duties
and obligations under the Advisory Agreement or this Agreement.
13.Survival of Representations and Warranties.
All representations and warranties made by the Sub-Adviser and SSGA FM
pursuant to Sections 8 and 9, respectively, shall survive for the duration of
this Agreement and the parties hereto shall promptly notify each other in
writing upon becoming aware that any of the foregoing representations and
warranties are no longer true.
14.Duration and Termination.
(a) This Agreement shall become effective upon the date first above written
and will continue for an initial two-year term and will continue thereafter so
long as the continuance is specifically approved at least annually (a) by the
Board or (b) by a vote of a majority of the Fund's outstanding voting
securities, as defined in the 1940 Act, provided that in either event the
continuance is also approved by a majority of the Board who are not parties to
this Agreement or "interested persons" (as defined in the 0000 Xxx) of any
party to this Agreement, by vote cast in person at a meeting called for the
purpose of voting on the approval.
(b) This Agreement may be terminated at any time without the payment of any
penalty, by the Board, or by vote of a majority of the Fund's outstanding
voting securities, on 60 days' written notice to the Sub-Adviser. This
Agreement may also be terminated, without the payment of any penalty, by SSGA
FM: (i) upon 60 days' written notice to the Sub-Adviser; (ii) upon material
breach by the Sub-Adviser of any of the representations and warranties set
forth in Section 8 of this Agreement; or (iii) if, in SSGA FM's reasonable
judgment, the Sub-Adviser becomes unable to discharge its duties and
obligations under this Agreement, including circumstances such as financial
insolvency of the Sub-Adviser or other circumstances that are reasonably likely
to adversely affect the Fund. The Sub-Adviser may terminate this Agreement at
any time, without the payment of a penalty, on 60 days' written notice to SSGA
FM. This Agreement will terminate automatically in the event of its assignment
(as defined under the 1940 Act, the rules thereunder or SEC staff
interpretations thereof), including without limitation, a change of control of
the Sub-Adviser, or upon termination of the Advisory Agreement.
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15.Change of Control of the Sub-Adviser.
In the event that this Agreement is automatically terminated as a result of
a change in control of the Sub-Adviser and SSGA FM and the Board approve to
retain Sub-Adviser as a sub-adviser to the Fund and the Sub-Adviser agrees to
be retained, the Sub-Adviser will be liable to the Company and SSGA FM for all
direct and indirect costs resulting from a change of control of the
Sub-Adviser, including without limitation all costs associated with proxy
solicitations, Board meetings, revisions to prospectuses, statements of
additional information and marketing materials, in connection with the
re-hiring of the Sub-Adviser as sub-adviser to the Fund. The understandings and
obligations set forth in this Section 15 shall survive the termination of this
Agreement and shall be binding upon the SubAdviser's successor(s) and/or
assign(s).
16.Confidentiality.
All information and advice furnished by either of the parties to the other
regarding the contents or management of the Allocated Assets will be treated as
confidential and will not be disclosed to third parties (other than
accountants, attorneys and other service providers who have agreed to preserve
the confidence of the information disclosed) except as required by law and as
may be necessary or appropriate to performance of its business activities,
including the services under this Agreement. Notwithstanding the foregoing,
SSGA FM consents to the inclusion of performance statistics regarding the
Allocated Assets in composite performance statistics regarding one or more
groups of the Sub-Adviser's clients published or otherwise included in the
Sub-Adviser's communications, provided the Sub-Adviser does not identify
performance statistics as relating to the Fund. SSGA FM also consents to
inclusion of the Fund's name in marketing materials and other similar
communications, indicating that the Sub-Adviser has been engaged to manage
assets on the Fund's behalf.
17.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 which enforcement of the change, waiver, discharge or termination is
sought, and no material amendment to the terms of this Agreement shall be
effective until approved by a vote of a majority of the Fund's outstanding
voting securities (unless the Company receives an SEC exemptive order or
opinion of counsel, or the issue is the subject of a position of the SEC or its
staff, permitting it to modify the Agreement without such vote).
18.Governing Law.
This Agreement 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.
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19.Miscellaneous.
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. If any provision of this Agreement shall
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 upon and shall inure to the benefit of the parties hereto. As used
in this Agreement, the terms "majority of the outstanding voting securities,"
"affiliated person," "interested person," "assignment," "broker," control,"
"investment adviser," "net assets," "sale," "sell" and "security" shall have
the same meaning as such terms have in the 1940 Act, subject to such exemption
as may be granted by the SEC by any rule, regulation or order. Where the effect
of a requirement of the federal securities laws reflected in any provision of
this Agreement is made less restrictive by rule, regulation or order of the
SEC, whether of special or general application, such provision shall be deemed
to incorporate the effect of such rule, regulation or order. This Agreement may
be signed in counterpart.
[Signature Page Follows]
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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.
SSGA FUNDS MANAGEMENT, INC.
By: /s/ Xxxxx X. Xxxxxxx
------------------------------
Name: Xxxxx X. Xxxxxxx
Title: President
GE INVESTMENTS FUNDS, INC., ON
BEHALF OF SMALL-CAP EQUITY FUND, A
SERIES OF GE INVESTMENTS FUNDS,
INC., SOLELY WITH RESPECT TO
SECTION 12(b) OF THIS AGREEMENT
By: /s/ Xxxxxx X. Xx Xxxxx
------------------------------
Name: Xxxxxx X. Xx Xxxxx
Title: President and Director
GLOBEFLEX CAPITAL, L.P.
By: /s/ X. Xxxxxxxx
------------------------------
Name: Xxxxxx Xxxxxxxx
Title: Chief Executive Officer
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SCHEDULE A
Fees Paid to the Sub-Adviser
The Sub-Adviser's fee shall be accrued daily at 1/365th of the applicable
annual rate set forth below:
REDACTED
The foregoing breakpoints and the annual rate to be paid by SSGA FM to the
Sub-Adviser shall be based on the net assets attributable to the aggregate
Allocated Assets of all the small-cap equity strategy managed by SSGA FM and
sub-advised by the Sub-Adviser.
For the purpose of accruing compensation, the net assets of the Fund shall
be determined in the manner and on the dates set forth in the current
prospectus of the Fund, and, on dates on which the net assets are not so
determined, the net asset value computation to be used shall be as determined
on the next day on which the net assets shall have been determined.
In the event of termination of this Agreement, all compensation due through
the date of termination will be calculated on a pro-rated basis through the
date of termination and paid within ninety (90) days of the date of termination.
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