INVESTMENT SUB-ADVISORY AGREEMENT
AGREEMENT made as of this 12th day of November, 2007 by
and among Old Mutual Capital, Inc. (the "Adviser"), Ashfield Capital
Partners, LLC (the "Sub-Adviser"), and Old Mutual Advisor Funds II,
a Delaware statutory trust (the "Trust").
WHEREAS, the Trust is registered as an open-end
management investment company under the Investment Company Act
of 1940, as amended (the "1940 Act");
WHEREAS, pursuant to an Agreement between the Adviser
and the Trust dated May 17, 2006, the Adviser acts as investment
manager for the assets of the portfolio(s) listed on Schedule A to this
Agreement (each, a "Fund"); and
WHEREAS, the Adviser and the Trust each desire to retain the
Sub-Adviser to provide investment advisory services to the Trust in
connection with the management of that portion of the assets of each
Fund that are allocated by the Adviser to a designated custodial
account established at the Fund's custodian (each such portion, a
"Portfolio"), which may constitute some or all of the assets of a Fund,
and the Sub-Adviser is willing to render such investment advisory
services.
NOW, THEREFORE, intending to be legally bound, the
parties hereto agree as follows:
1. a) Subject to supervision and oversight by the Adviser
and the Trust's Board of Trustees, the Sub-Adviser shall manage (i)
the investment operations of the Portfolio, and (ii) the composition
of such assets, including the purchase, retention and disposition
thereof, in accordance with the Fund's investment objectives,
policies and restrictions as stated in such Fund's Prospectus(es)
(such Prospectus(es) and Statement(s) of Additional Information as
currently in effect and as amended or supplemented from time to
time, being herein called the "Prospectus"), and subject to the
following understandings:
(1) The Sub-Adviser shall provide supervision of
each Portfolio's investments and determine from time to time what
investments and securities will be purchased, retained or sold by such
Portfolio and what portion of such assets will be invested or held
uninvested in cash.
(2) In the performance of its duties and obligations
under this Agreement, the Sub-Adviser shall act in conformity with the
Trust's Prospectus and with the instructions and directions of the
Adviser and of the Board of Trustees and will conform and comply
with the requirements of the 1940 Act, the Internal Revenue Code of
1986, as amended, and all other applicable federal and state laws and
regulations, as each is amended from time to time.
(3) The Sub-Adviser shall determine the securities
to be purchased or sold with respect to each Portfolio and will place
orders with or through such persons, brokers or dealers to carry out the
policy with respect to brokerage set forth in the respective Fund's
Registration Statement (as defined herein) and Prospectus or as the
Board of Trustees or the Adviser may direct from time to time, in
conformity with federal securities laws. In providing a Portfolio with
investment supervision, the Sub-Adviser will give primary
consideration to securing the most favorable price and efficient
execution. Within the framework of this policy, the Sub-Adviser may
consider the financial responsibility, research and investment
information and other services provided by brokers or dealers who
may effect or be a party to any such transaction or other transactions to
which the Sub-Adviser's other clients may be a party. It is understood
that it is desirable for a Portfolio that the Sub-Adviser have access to
(i) supplemental investment and market research and (ii) security and
economic analysis provided by brokers who may execute brokerage
transactions at a higher cost to the Portfolio than may result when
allocating brokerage to other brokers on the basis of seeking the most
favorable price and efficient execution. Therefore, the Sub-Adviser is
authorized to place orders for the purchase and sale of securities on
behalf of each Portfolio with brokers, subject to review by the Trust's
Board of Trustees from time to time with respect to the extent and
continuation of this practice. It is understood that the services
provided by such brokers may be useful to the Sub-Adviser in
connection with the Sub-Adviser's services to other clients.
On occasions when the Sub-Adviser deems the
purchase or sale of a security to be in the best interest of a Portfolio as
well as other clients of the Sub-Adviser, the Sub-Adviser, to the extent
permitted by applicable laws and regulations, may, but shall be under no
obligation to, aggregate the securities to be so purchased or sold in order
to obtain the most 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 the Sub-Adviser in the manner it considers to be the most
equitable and consistent with its fiduciary obligations to the Portfolio in
question and to such other clients.
(4) The Sub-Adviser at its expense will make available
to the Trustees of the Trust and the Adviser at reasonable times its
portfolio managers and other appropriate personnel, either in person or, at
the mutual convenience of the Adviser and the Sub-Adviser, by telephone,
in order to review the investment policies, performance and other
investment related information regarding the Portfolio and to consult with
the Trustees of the Trust and Adviser regarding the Portfolio's investment
affairs, including economic, statistical and investment matters related to
the Sub-Adviser's duties hereunder, and will provide periodic reports to
the Adviser relating to the investment strategies it employs. The Sub-
Adviser and its personnel shall also cooperate fully with counsel and
auditors for, and the Chief Compliance Officers of, the Adviser and the
Trust.
(5) In accordance with procedures adopted by the
Trustees of the Trust, as amended from time to time, the Sub-Adviser is
responsible for assisting in the fair valuation of all Portfolio securities.
The Sub-Adviser will use its reasonable efforts to provide, based upon its
own expertise, and to arrange with parties independent of the Sub-Adviser
such as broker-dealers for the provision of, valuation information or prices
for securities for which prices are deemed by the Adviser or Trust's
administrator not to be readily available in the ordinary course of business
from an automated pricing service. In addition, the Sub-Adviser will
assist the Fund and its agents in determining whether prices obtained for
valuation purposes accurately reflect market price information relating to
the assets of the Portfolio at such times as the Adviser shall reasonably
request, including but not limited to, the hours after the close of a
securities market and prior to the daily determination of a Fund's net asset
value per share.
(6) The Sub-Adviser at its expense will provide the
Adviser and/or the Trust's Chief Compliance Officer with such
compliance reports relating to its duties under this Agreement as may be
requested from time to time. Notwithstanding the foregoing, the Sub-
Adviser will promptly report to the Adviser any material violations of the
federal securities laws (as defined in Rule 38a-1 of the 0000 Xxx) that it is
or should be aware of or of any material violation of the Sub-Adviser's
compliance policies and procedures that pertain to the Portfolio, as well as
any change in portfolio manager(s) of the Portfolio.
(7) Unless otherwise directed by the Adviser or the
Trust's Board of Trustees, the Sub-Adviser will vote all proxies received
in accordance with the Trust's proxy voting policy or, if the Sub-Adviser
has a proxy voting policy approved by the Trust's Board of Trustees, the
Sub-Adviser's proxy voting policy. The Adviser shall instruct the
Portfolio's custodian to forward or cause to be forwarded to the Sub-
Adviser all relevant proxy solicitation materials. The Sub-Adviser shall
maintain and shall forward to the Fund or its designated agent such proxy
voting information as is necessary for the Fund to timely file proxy voting
results in accordance with Rule 30b1-4 of the 0000 Xxx.
(8) The Sub-Adviser represents and warrants that it has
adopted a code of ethics meeting the requirements of Rule 17j-1 under the
1940 Act and the requirements of Rule 204A-1 under the Investment
Advisers Act of 1940 and has provided the Adviser and the Trustees of the
Fund a copy of such code of ethics, together with evidence of its adoption,
and will promptly provide copies of any changes thereto, together with
evidence of their adoption. Upon request of the Adviser, but in any event
no less frequently than annually, the Sub-Adviser will supply the Adviser
a written report that (A) describes any issues arising under the code of
ethics or procedures since the Sub-Adviser's last report, including but not
limited to material violations of the code of ethics or procedures and
sanctions imposed in response to the material violations; and (B) certifies
that the procedures contained in the Sub-Adviser's code of ethics are
reasonably designed to prevent "access persons" from violating the code
of ethics.
(9) The Sub-Adviser will review draft reports to
shareholders and other documents provided or available to it and provide
comments on a timely basis. In addition, the Sub-Adviser and each officer
and portfolio manager thereof designated by the Adviser will provide on a
timely basis such certifications or sub-certifications as the Adviser may
reasonably request in order to support and facilitate certifications required
to be provided by the Trust's Principal Executive Officer and Principal
Accounting Officer.
(10) The Sub-Adviser shall maintain all books and
records with respect to each Portfolio's portfolio transactions required by
subparagraphs (b)(5), (6), (7), (9), (10) and (11) and paragraph (f) of Rule
31a-1 under the 1940 Act and shall render to the Trust's Board of Trustees
such periodic and special reports as the Trust's Board of Trustees may
reasonably request.
(11) The Sub-Adviser shall provide the Fund's custodian
on each business day with information relating to all transactions
concerning the assets of the Portfolio and shall provide the Adviser with
such information upon request of the Adviser.
(12) (a) The investment management services
provided by the Sub-Adviser under this Agreement are not to be deemed
exclusive and the Sub-Adviser shall be free to render similar services to
others, as long as such services do not impair the services rendered to the
Adviser or the Trust.
(b) Services to be furnished by the Sub-Adviser
under this Agreement may be furnished through the medium of any of the
Sub-Adviser's officers or employees.
(c) The Sub-Adviser shall keep each Portfolio's
books and records required to be maintained by the Sub-Adviser pursuant
to paragraph 1(a) of this Agreement and shall timely furnish to the Adviser
all information relating to the Sub-Adviser's services under this
Agreement needed by the Adviser to keep the other books and records of a
Portfolio required by Rule 31a-1 under the 1940 Act. The Sub-Adviser
agrees that all records that it maintains on behalf of a Portfolio are
property of the Fund and the Sub-Adviser will surrender promptly to a
Fund any of such records upon that Fund's request; provided, however,
that the Sub-Adviser may retain a copy of such records. The Sub-Adviser
further agrees to preserve for the periods prescribed by Rule 31a-2 under
the 1940 Act any such records as are required to be maintained by it
pursuant to paragraph 1(a) of this Agreement.
2. The Adviser shall continue to have responsibility for all services
to be provided to each Portfolio pursuant to the Advisory Agreement and
shall oversee and review the Sub-Adviser's performance of its duties
under this Agreement.
3. The Adviser has delivered to the Sub-Adviser copies of each of
the following documents and will deliver to it all future amendments and
supplements, if any:
(a) Certified resolutions of the Trust's Board of Trustees
authorizing the appointment of the Sub-Adviser and approving the form
of this Agreement;
(b) Registration Statement under the 1940 Act and the
Securities Act of 1933, as amended on Form N-1A (the "Registration
Statement"), as filed with the Securities and Exchange Commission (the
"Commission") relating to the Fund and shares of the Fund's beneficial
shares, and all amendments thereto; and
(c) Prospectus(es) of the Fund.
4. For the services to be provided by the Sub-Adviser pursuant to
this Agreement for the Portfolios, the Adviser will pay to the Sub-
Adviser as full compensation therefor a fee at an annual rate equal to a
percentage of each Portfolio's average daily net assets, as set forth on
Schedule A (net of 50% of any waivers, reimbursement payments,
supermarket fees and alliance fees waived, reimbursed or paid by the
Adviser in respect of each Portfolio). This fee will be paid to the Sub-
Adviser from the Adviser's advisory fee for such Portfolio. This fee will
be computed daily and paid to the Sub-Adviser monthly.
To the extent that the Adviser is reimbursed by the Trust for any
waived fees or reimbursed expenses pursuant to the terms of a separate
expense limitation agreement between the Trust and the Adviser, the
Adviser will pay to the Sub-Adviser its pro-rata share of any such
reimbursed amount.
5. The Sub-Adviser shall not be liable for any error of judgment or
for any loss suffered by a Fund or the Adviser in connection with
performance of its obligations under this Agreement, except a loss
resulting from a breach of fiduciary duty with respect to the receipt of
compensation for services (in which case any award of damages shall be
limited to the period and the amount set forth in Section 36(b)(3) of the
1940 Act), or a loss resulting from willful misfeasance, bad faith or
gross negligence on the Sub-Adviser's part in the performance of its
duties or from reckless disregard of its obligations and duties under this
Agreement, except as may otherwise be provided under provisions of
applicable state law which cannot be waived or modified hereby.
6. This Agreement shall continue for an initial period ending
November 12, 2009, and thereafter shall continue automatically for
successive annual periods, provided such continuance is specifically
approved at least annually in conformance with the 1940 Act provided,
however, that this Agreement may be terminated (a) by a Fund at any
time, without the payment of any penalty, by the vote of a majority of
Trustees of the Trust or by the vote of a majority of the outstanding
voting securities of a Fund, (b) by the Adviser at any time, without the
payment of any penalty, on not more than 60 days' nor less than 30
days' written notice to the other parties, or (c) by the Sub-Adviser at any
time, without the payment of any penalty, on 90 days' written notice to
the other parties. This Agreement shall terminate automatically and
immediately in the event of its assignment. As used in this Section 6,
the terms "assignment" and "vote of a majority of the outstanding voting
securities" shall have the respective meanings set forth in the 1940 Act
and the rules and regulations thereunder, subject to such exceptions as
may be granted by the Commission under the 1940 Act.
7. Nothing in this Agreement shall limit or restrict the right of any
of the Sub-Adviser's partners, officers, or employees 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 business, whether of a similar or
dissimilar nature, nor limit or restrict the Sub-Adviser's right to engage
in any other business or to render services of any kind to any other
corporation, firm, individual or association.
8. During the term of this Agreement, the Adviser agrees to furnish
the Sub-Adviser at its principal office all prospectuses, proxy statements,
reports to shareholders, sales literature or other materials prepared for
distribution to shareholders of the Fund, the Trust or the public that
refers to the Sub-Adviser or its clients in any way prior to use thereof
and not to use material if the Sub-Adviser reasonably objects in writing
within five business days (or such other period as may be mutually
agreed upon) after receipt thereof. The Sub-Adviser's right to object to
such materials is limited to the portions of such materials that expressly
relate to the Sub-Adviser, its services and its clients. The Adviser agrees
to use its reasonable best efforts to ensure that materials prepared by its
employees or agents or its affiliates that refer to the Sub-Adviser or its
clients in any way are consistent with those materials previously
approved by the Sub-Adviser as referenced in the first sentence of this
paragraph. Sales literature may be furnished to the Sub-Adviser by first-
class mail, electronic mail or overnight delivery service, facsimile
transmission equipment or hand delivery.
9. No Trustee or Shareholder of the Trust shall be personally liable
for any debts, liabilities, obligations or expenses incurred by, or
contracted for under this Agreement.
10. No provisions 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 amendment of this Agreement
shall be effective until approved by the vote of the majority of the
outstanding voting securities of each Fund.
11. This Agreement shall be governed by the laws of the state of
Delaware; provided, however, that nothing herein shall be construed as
being inconsistent with the 1940 Act.
12. This Agreement embodies the entire agreement and
understanding among the parties hereto, and supersedes all prior
agreements and understandings relating to this Agreement's subject
matter. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original; all such
counterparts shall, together, constitute only one instrument.
13. 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
shall inure to the benefit of the parties hereto and their respective
successors.
14. Any notice, advice or report to be given pursuant to this
Agreement shall be delivered or mailed:
To the Adviser at:
To the Sub-Adviser at:
Old Mutual Capital, Inc.
Ashfield Capital Partners, LLC
0000 Xxxxx Xxxxxx Xxxxxx, Xxxxx 000
000 Xxxxxxx Xxxxxx, Xxxxx 000
Xxxxxx, XX 00000
Xxx Xxxxxxxxx, XX 00000
Attention: General Counsel
Attention: President
To the Trust or a Fund at:
Old Mutual Advisor Funds II
0000 Xxxxx Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxx, XX 00000
Attention: Secretary
15. Where the effect of a requirement of the 1940 Act reflected in any
provision of this Agreement is altered by a rule, regulation or order of the
Commission, whether of special or general application, such provision shall be
deemed to incorporate the effect of such rule, regulation or order.
16. As required by certain exemptive rules under the 1940 Act, the
Sub-Adviser is prohibited from consulting with the entities listed below
concerning transactions for the Fund in securities or other assets:
1. other subadvisers to the Fund
2. other subadvisers to a Trust portfolio
3. other subadvisers to a portfolio under common control with the Fund.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their officers designated below as of the day and
year first written above.
OLD MUTUAL CAPITAL, INC.
OLD MUTUAL ADVISOR FUNDS II
By:
/s/ Xxxx X. Xxxxx
By:
/s/ Xxxxxx X. Xxxxx
Name:
Xxxx X. Xxxxx
Name:
Xxxxxx X. Xxxxx
Title:
Chief Financial Officer
Title:
Treasurer
ASHFIELD CAPITAL PARTNERS, LLC
By:
/s/ J. Xxxxxxx Xxxxx
Name:
J. Xxxxxxx Xxxxx
Title:
President & CEO
SCHEDULE A
DATED NOVEMBER 12, 2007
TO
INVESTMENT SUB-ADVISORY AGREEMENT
AMONG
ASHFIELD CAPITAL PARTNERS, LLC,
OLD MUTUAL CAPITAL, INC.
AND
OLD MUTUAL ADVISOR FUNDS II
DATED NOVEMBER 12, 2007
PORTFOLIO
Sub-Advisory Fee Breakpoint Asset Thresholds
$0 to
less than
$300
million
$300
million to
less than
$500
million
$500
million to
less than
$750
million
$750
million to
less than
$1.0
billion
$1.0
billion to
less than
$1.5
billion
$1.5
billion to
less than
$2.0
billion
$2.0
billion or
greater
Old Mutual
Emerging
Growth Fund
0.60%
0.55%
0.50%
0.45%
0.40%
0.35%
0.30%
Breakpoints will be calculated based on the total assets of the Fund.
"Old Mutual Developing Growth Fund" effective November 19, 2007.
G-1
