Exhibit 23(d)(2)(nn)(a)
Sub-sub-advisory Agreement - Transamerica Xxxxxxx Growth
SUB-ADVISORY AGREEMENT
BETWEEN
COLUMBIA MANAGEMENT ADVISORS, LLC
AND XXXXXXX CAPITAL MANAGEMENT, LLC
This Agreement is entered into as of December 14, 2007 between Columbia
Management Advisors, LLC (referred to herein as "Columbia"), and Xxxxxxx Capital
Management, LLC (referred to herein as "MCM").
WHEREAS, Columbia (formerly Banc of America Capital Management, LLC)
entered into a Sub-Advisory Agreement (referred to herein as the "Advisory
Agreement"), dated as of December 5, 2002 with AEGON/Transamerica Fund Advisers,
Inc. (referred to herein as "ATFA") with respect to providing advisory services
to IDEX Mutual Funds, a Massachusetts business trust (herein referred to as
"IDEX"), on behalf of IDEX Xxxxxxx Growth (the "Fund").
WHEREAS, the Advisory Agreement provides that Columbia may engage MCM to
furnish investment information and advice to assist Columbia in carrying out its
responsibilities under the Advisory Agreement as investment sub-adviser to the
Fund.
WHEREAS, it is the purpose of this Agreement to express the mutual
agreements of the parties hereto with respect to the services to be provided by
MCM to Columbia and the terms and conditions under which such services will be
rendered.
NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth herein, the parties hereto agree as follows:
1. SERVICES OF MCM. MCM shall act as investment counsel to Columbia with
respect to the Fund. In this capacity, MCM shall have the following
responsibilities:
(a) provide a continuous investment program for the Fund including advice
as to the acquisition, holding or disposition of any or all of the
securities or other assets which the Fund may own or contemplate
acquiring from time to time;
(b) to cause its representatives to attend meetings of ATFA or IDEX (by
telephone or otherwise) when reasonably necessary and to furnish oral
or written reports, as Columbia may reasonably require, in order to
keep Columbia, ATFA and their respective officers and the Trustees of
IDEX and appropriate officers of IDEX fully informed as to the
condition of the investment portfolio of the Fund, the investment
recommendations of MCM, and the investment considerations which have
given rise to those recommendations;
(c) to furnish such statistical and analytical information and reports as
may reasonably be required by Columbia from time to time;
(d) to supervise the purchase and sale of securities as sub-adviser as
described below;
(e) Investment Sub-Advisory Services. MCM shall act as the investment
sub-adviser and shall supervise and direct the investments of the Fund
in accordance with the Fund's investment objective, policies, and
restrictions as provided in the Prospectus and Statement of Additional
Information, as currently in effect and as amended or supplemented
from time to time (hereinafter referred to as the "Prospectus"), and
such other limitations as directed by the appropriate officers of
Columbia, ATFA or IDEX by notice in writing to MCM; provided that MCM
shall be entitled to rely on and comply with the Prospectus most
recently furnished to MCM by Columbia (as received from ATFA). MCM
shall obtain and evaluate such information relating to the economy,
industries, businesses, securities markets, and securities as it may
deem necessary or useful in the discharge of its obligations hereunder
and shall formulate and implement a continuing program for the
management of the assets and resources of the Fund in a manner
consistent with the Fund's investment objective, policies, and
restrictions. In furtherance of this duty, MCM, on behalf of the Fund,
is authorized, in its discretion and without prior consultation with
IDEX, Columbia or ATFA, to:
(1) Buy, sell, exchange, convert, lend, and otherwise trade in any
stocks, bonds and other
securities or assets; and
(2) Place orders and negotiate the commissions (if any) for the
execution of transactions in securities or other assets with or
through such brokers, dealers, underwriters or issuers as MCM may
select.
2. OBLIGATIONS OF COLUMBIA. Columbia shall have the following obligations
under this Agreement:
(a) to keep MCM continuously and fully informed as to the composition of
the Fund's investment portfolio and the nature of the Fund's assets
and liabilities from time to time;
(b) to furnish MCM with copies of each of the following documents and all
future amendments and supplements to such documents, if any, as soon
as practicable after such documents become available;
(1) The Agreement and Declaration of Trust of IDEX, as filed with the
State of Massachusetts, as in effect on the date hereof and as
amended from time to time ("Articles");
(2) The By-Laws of IDEX as in effect on the date hereof and as
amended from time to time ("By-Laws");
(3) Certified resolutions of the Board of IDEX authorizing the
appointment of Columbia and MCM approving the form of the
Advisory Agreement and this Agreement;
(4) IDEX Registration Statement under the 1940 Act and the Securities
Act of 1933, as amended, on Form N-1A, as filed with the
Securities and Exchange Commission ("SEC") relating to the Fund
and its shares and all amendments thereto ("Registration
Statement");
(5) The Fund's Prospectus (as defined above); and
(6) A certified copy of any publicly available financial statement or
report prepared for the Fund by certified or independent public
accountants, and copies of any financial statements or reports
made by the Fund to its shareholders or to any government body or
securities exchange.
(c) to furnish MCM with any further materials or information which MCM may
reasonably request to enable it to perform its functions under this
Agreement;
(d) to compensate MCM for its services under this Agreement as set forth
in Schedule A. The fee shall accrue daily and be paid monthly in
arrears within 15 days after the end of each month. In the event that
this Agreement shall be effective for only part of a period, then an
appropriate pro-ration of the fee that would have been payable
hereunder shall be made, based on the number of calendar days in such
period and the number of calendar days during the period in which this
Agreement was in effect.
3. BROKERAGE.
(a) MCM agrees that, in placing orders with broker-dealers for the
purchase or sale of portfolio securities, it shall attempt to obtain
quality execution at favorable security prices (best price and
execution); provided that, on behalf of the Fund, MCM may, in its
discretion, agree to pay a broker-dealer that furnishes brokerage or
research services as such services are defined under Section 28(e) of
the Securities Exchange Act of 1934, as amended ("1934 Act"), a higher
commission than that which might have been charged by another
broker-dealer for effecting the same transactions, if MCM determines
in good faith that such commission is reasonable in relation to the
brokerage and research services provided by the broker-dealer, viewed
in terms of either that particular transaction or the overall
responsibilities of MCM with respect to the accounts as to which it
exercises investment discretion (as such term is defined under Section
3(a)(35) of the 1934 Act). In no instance will portfolio securities be
purchased from or sold to
MCM, or any affiliated person thereof, except in accordance with the
federal securities laws and the rules and regulations thereunder.
(b) On occasions when MCM deems the purchase or sale of a security to be
in the best interest of the Fund as well as other clients of MCM, MCM,
to the extent permitted by applicable laws and regulations, may, but
shall be under no obligation to, aggregate the securities to be
purchased or sold to attempt to obtain a more favorable price or lower
brokerage commissions and efficient execution. In such event,
allocation of the securities so purchased or sold, as well as the
expenses incurred in the transaction, will be made by MCM in the
manner MCM considers to be fair and equitable and consistent with its
fiduciary obligations to the Fund and to its other clients.
(c) Without limiting MCM's discretion in seeking best execution by placing
orders and negotiating commissions with broker-dealers it selects, MCM
agrees that orders with broker-dealers for the purchase or sale of
portfolio securities by the Fund shall be placed in accordance with
reasonable standards set forth in the Advisory Agreement if Columbia
timely brings them to MCM's attention, subject to compliance with
applicable laws and procedures adopted by the Trustees of IDEX. At the
direction of ATFA, Columbia may direct MCM to effect a portion of all
transactions in portfolio securities for the Fund through
broker-dealers in a manner that will generate resources to help pay
certain expenses that the Fund is required to pay or for which the
Fund is required to arrange payment or for any other lawful purposes.
MCM will treat such a direction as a decision by ATFA to retain, to
the extent of the direction, the discretion that MCM otherwise would
exercise to select broker-dealers and negotiate commissions for the
Fund. There may be occasions when MCM is unable to obtain best
execution because, for example, MCM cannot evaluate the services
provided by the selected broker, the selected broker may not be as
efficient in executing transactions as another broker, or the trade
cannot be aggregated with other trades sent to other brokers.
(d) MCM is authorized to place orders on behalf of the Fund through MCM or
any affiliate thereof if MCM or affiliate is registered as a broker or
dealer with the SEC or as a FCM with the Commodities Futures Trading
Commission ("CFTC"), to any of its affiliates that are brokers or
dealers or FCBs or such other entities which provide similar services
in foreign countries, or to such brokers or dealers that also provide
research or statistical research and material, or other services to
the Funds or MCM. Such allocation shall be in such amounts and
proportions as MCM shall determine consistent with the above
standards, and, upon, request, MCM will report on said allocation to
Columbia and Board of Trustees of IDEX, indicating the brokers,
dealers or FCBs to which such allocations have been made and the basis
therefor.
(e) MCM may use any broker or dealer affiliated with MCM ("affiliated
broker"), to execute trades for the Fund, provided that MCM seeks best
execution in using the affiliated broker. An affiliated broker will
not act as principal for its own account, but may execute transactions
as agent for the Fund on an exchange floor, and receive and retain all
commissions, fees, and benefits without complying further with Section
11(a) of the Securities Exchange Act. An affiliated broker also may
execute agency cross trades in which it simultaneously acts as broker
for the Fund and for another customer on the other side of the trade.
Agency cross trades may enable MCM to purchase or sell a block of
securities for the Fund at a set price, and to avoid unfavorable price
movements caused by trading a large order on the market. MCM will
comply with all legal requirements concerning the use of an affiliated
broker, including Rules 10f-3 and 17e-1 under the Investment Company
Act and Rule 206(3)-2 under the Investment Advisers Act. Columbia and
ATFA are aware that MCM's affiliation with an affiliated broker could
give MCM an indirect interest in commissions received by the
affiliated broker, and that agency cross trades could create
potentially conflicting divisions of loyalties and responsibilities
because the affiliated broker acts for both sides of the trade.
Columbia or ATFA may at any time revoke its consent to the execution
of agency cross trades for the Fund by giving written notice to MCM or
the affiliated broker.
4. PURCHASES BY AFFILIATES. Although MCM will not purchase securities
issued by the Fund, MCM's officers, directors, and employees may purchase from
the Fund shares issued by the Fund at the current price available to the public,
or at such price with reductions in sales charge as may be permitted in the
Fund's current
prospectus in accordance with Section 22(d) of the Investment Company Act of
1940, as amended (the "1940 Act").
5. SERVICES TO OTHER CLIENTS. Nothing contained in this Agreement shall
limit or restrict (i) the freedom of MCM, or any affiliated person thereof, to
render investment management and corporate administrative services to other
investment companies, to act as investment manager or investment counselor to
other persons, firms, or corporations, or to engage in any other business
activities, or (ii) the right of any director, officer, or employee of MCM, to
engage in any other business or to devote his or her time and attention in part
to the management or other aspects of any other business, whether of a similar
nature or a dissimilar nature.
6. SUB-ADVISER'S USE OF THE SERVICES OF OTHERS. MCM may employ, retain, or
otherwise avail itself of the services or facilities of subcontractors, or other
persons or organizations for the purpose of obtaining such statistical and other
factual information, such advice regarding economic factors and trends, such
advice as to transactions in specific securities, or such other information,
advice, or assistance as MCM may deem necessary, appropriate, or convenient for
discharge of its obligations hereunder or otherwise helpful to the Fund, as
appropriate, or in the discharge of MCM overall responsibilities with respect to
the other accounts that it serves as investment manager or counselor.
7. LIMITATION OF LIABILITY OF THE SUB-ADVISER. Neither MCM, nor any of its
officers, directors, or employees, or any other person performing executive,
administrative, trading, or other functions for MCM, the Fund (at the direction
or request of MCM), ATFA, or Columbia in connection with MCM's discharge of its
obligations undertaken or reasonably assumed with respect to this Agreement,
shall be liable for any error of judgment or mistake of law or for any loss
suffered by ATFA, Columbia or the Fund, or for any error of facts or mistake of
law contained in any report or date provided by MCM, except for any error,
mistake or loss resulting from willful misfeasance, bad faith or gross
negligence in the performance of its duties on behalf of the Fund or from
reckless disregard by MCM, or any such person of the duties of MCM pursuant to
this Agreement.
No statement in this Agreement or any other document constitutes a
representation by MCM regarding the rate of growth or return of the Fund.
Neither MCM nor any of its officers, directors, or employees make any
representations or warranties, express or implied, that any level of performance
or investment results will be achieved by the Fund or that the Fund will perform
comparably with any standard or index, including other MCM client accounts.
8. REPRESENTATIONS.
The parties hereto represent, warrant, and agree as follows:
(a) Columbia and MCM each: (i) is registered as an investment adviser
under the Advisers Act and any applicable state laws 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 continue to meet for so long as this Agreement remains in
effect, any 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 (v) will
immediately notify the other party of the occurrence of any event that
would disqualify such other party from serving as an investment
adviser of an investment company pursuant to Section 9(a) of the 1940
Act or otherwise.
(b) Columbia and MCM each has adopted a written code of ethics complying
with the requirements of Rule 17j-1 under the 1940 Act and, if it has
not already done so, will provide the Investment Adviser and the Fund
with a copy of such code of ethics, together with evidence of its
adoption.
(c) MCM has provided Columbia and ATFA with a copy of its Form ADV as most
recently filed with the SEC and will annually furnish a copy of Part 2
of Form ADV to Columbia and ATFA.
9. TERM OF AGREEMENT.
This Agreement shall become effective upon the date first above written,
provided that this Agreement shall not take effect unless it has first been
approved (i) by a vote of a majority of those Trustees who are not parties
to this Agreement or interested persons of any such party, cast in person at a
meeting called for the purpose of voting on such approval, and (ii) by vote of a
majority of the Fund's outstanding voting securities. Unless sooner terminated
as provided herein, this Agreement shall continue in effect for an initial term
ending April 30, 2004. Thereafter, this Agreement shall continue in effect from
year to year, with respect to the Fund, subject to the termination provisions
and all other terms and conditions hereof, so long as such continuation shall be
specifically approved at least annually (a) by either the Board, or by vote of a
majority of the outstanding voting securities of the Fund; and (b) in either
event, by the vote, cast in person at a meeting called for the purpose of voting
on such approval, of a majority of the Trustees of IDEX who are not parties to
this Agreement or interested persons of any such party. MCM shall furnish to
Columbia and/or IDEX, promptly upon its request such information as may
reasonably be necessary to evaluate the terms of this Agreement or any
extension, renewal, or amendment hereof.
10. TERMINATION OF AGREEMENT.
Notwithstanding the foregoing, this Agreement may be terminated at any
time, without the payment of any penalty, by vote of the Board or by a vote of a
majority of the outstanding voting securities of the Fund, or per the terms of
the exemptive order-Release No. 00000-xxxxx Xxxxxxx 6(c) of the Act from Section
15(a) and Rule 18f-2 under the Act, on at least 60 days' prior written notice to
MCM. This Agreement may also be terminated by Columbia: (i) on at least 60 days'
prior written notice to MCM, without the payment of any penalty; or (ii) if MCM
becomes unable to discharge its duties' and obligations under this Agreement.
MCM may terminate this Agreement at any time, or preclude its renewal without
the payment of any penalty, on at least 60 days' prior notice to Columbia and
ATFA. This Agreement shall terminate automatically in the event of its
assignment or upon termination of the Advisory Agreement. Upon any termination,
fees shall be payable to MCM through the effective date on a pro-rated basis in
accordance with section 2(d).
11. AMENDMENT OF 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 of this Agreement shall be effective until
approved by vote, or a majority of the Fund outstanding voting securities and a
vote of a majority of those Trustees of IDEX who are not parties to this
Agreement or interested persons of any such party, cast in person at a meeting
called for the purpose of voting on such amendment, unless otherwise permitted
in accordance with the 1940 Act.
12. MISCELLANEOUS.
(a) Governing Law. This Agreement shall be construed in accordance with
the laws of the State of New York without giving effect to the
conflicts of laws principles thereof, and the 1940 Act. 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.
(b) Captions. The captions contained 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.
(c) Entire Agreement. This Agreement represents the entire agreement and
understanding of the parties hereto and shall supersede any prior
agreements between the parties relating to the subject matter hereof,
and all such prior agreements shall be deemed terminated upon the
effectiveness of this Agreement.
(d) Interpretation. Nothing herein contained shall be deemed to require
IDEX to take any action contrary to its Articles or By-Laws, or any
applicable statutory or regulatory requirement to which it is subject
or by which it is bound, or to relieve or deprive the Board of its
responsibility for and control of the conduct of the affairs of IDEX.
(e) Definitions. Any question of interpretation of any term or provision
of this Agreement having a counterpart in or otherwise derived from a
term or provision of the 1940 Act shall be resolved by reference to
such term or provision of the 1940 Act and to interpretation thereof,
if any, by the United States courts or, in the absence of any
controlling decision of any such court, by rules, regulations, or
orders of the SEC validly issued pursuant to the 1940 Act. As used in
this
Agreement, the terms "majority of the outstanding voting securities,"
"affiliated person," "interested person," "assignment," "broker,"
"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 a 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, unless
Columbia and MCM agree to the contrary.
(f) MCM/Xxxxxxx Name: IDEX Mutual Funds may use any name including or
derived from the name "MCM" or "Xxxxxxx" in connection with a fund
only for so long as this Agreement, or any extension, renewal or
amendment hereof remains in effect, including any similar agreement
with any organization which shall succeed to MCM's or Xxxxxxx'x
business as investment adviser or distributor. Upon termination of
this Agreement ATFA and IDEX Mutual Funds will cause the fund to cease
to use such a name or any other name indicating that it is advised by
or otherwise connected with MCM or Xxxxxxx or any organization which
shall have so succeeded to MCM's or Xxxxxxx'x business.
13. COMPLIANCE WITH LAWS.
(a) In all matters relating to the performance of this Agreement, MCM will
act in conformity with the IDEX Declaration of Trust, Bylaws, and
current prospectus and with the instructions and direction of
Columbia, ATFA and the Fund's Trustees.
(b) MCM shall conform with (1) the 1940 Act and all rules and regulations
thereunder, and releases and interpretations thereto (including any
no-action letters and exemptive orders which have been granted by the
SEC to the Fund, ATFA, Columbia and/or MCM and (2) with all other
applicable federal and state laws and regulations pertaining to
management of investment companies.
(c) ATFA shall perform quarterly and annual tax compliance tests to ensure
that the Fund is in compliance with Subchapter M of the Internal
Revenue Code ("IRC"). In connection with such compliance tests, ATFA
shall prepare and provide reports to Columbia and MCM within 10
business days of a calendar quarter end relating to the
diversification of the Fund under Subchapter M. MCM shall review such
reports for purposes of determining compliance with such
diversification requirements. If it is determined that the Fund is not
in compliance with the requirements noted above, MCM, in consultation
with Columbia, will take prompt action to bring the Fund back into
compliance within the time permitted under the IRC.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
ATTEST: COLUMBIA MANAGEMENT ADVISORS, LLC
By: /s/ Xxxxx Xxxxxxx By: /s/ Xxxx Xxx Xxxxx
--------------------------------- ------------------------------------
Name: Xxxxx Xxxxxxx Name: Xxxx Xxx Xxxxx
Title: Managing Director Title: Managing Director
ATTEST: XXXXXXX CAPITAL MANAGEMENT, LLC
By: /s/ Xxxx X. Xxxxxxx By: /s/ Xxxxxxxxxxx X. Xxxxxxx
--------------------------------- ------------------------------------
Name: Xxxx X. Xxxxxxx Name: Xxxxxxxxxxx X. Xxxxxxx
Title: Senior Paralegal Title: President
SCHEDULE A
IDEX Xxxxxxx Growth 0.40% of the Fund's average daily net assets
