Exhibit (d)(2)
SUB-ADVISORY AGREEMENT
This Agreement, made as of this _____ day of ____________, 2001, by and
between U.S. Bancorp Xxxxx Xxxxxxx Asset Management, Inc., a Delaware
corporation (the "Advisor"), and Voyageur Asset Management, Inc., a Minnesota
corporation (the "Sub-Advisor").
WHEREAS, Portico Funds, Inc., a Minnesota corporation ("Portico
Funds"), on behalf of its Large Cap Growth Fund, a separately managed series of
Portico Funds (the "Fund"), has appointed the Advisor as the Fund's investment
advisor pursuant to an Investment Advisory Agreement dated _________________,
2001 (the "Advisory Agreement"); and
WHEREAS, pursuant to the terms of the Advisory Agreement, the Advisor
desires to appoint the Sub-Advisor as its sub-advisor for the Fund, and the
Sub-Advisor is willing to act in such capacity upon the terms set forth herein;
and
WHEREAS, pursuant to the terms of the Advisory Agreement, Portico Funds
has approved the appointment of the Sub-Advisor as the sub-advisor for the Fund.
NOW, THEREFORE, the Advisor and the Sub-Advisor agree as follows:
1. The Advisor hereby retains the Sub-Advisor, and the
Sub-Advisor hereby agrees to act, as sub-advisor for, and to
manage the investment of the assets of, the Fund as set forth
herein. Without limiting the generality of the foregoing, it
is specifically understood and agreed by the Advisor and the
Sub-Advisor that:
(a) The investment of the Fund's assets shall at all
times be subject to the investment objectives,
policies and restrictions of the Fund as set forth in
Portico Funds' then-effective Registration Statement
under the Securities Act of 1933, as amended,
including the Prospectus and Statement of Additional
Information of the Fund contained therein. The
Advisor shall communicate to the Sub-Advisor any
changes or additions to or interpretations of such
investment objectives, policies and restrictions of
the Fund made by the Board of Directors of Portico
Funds (the "Board"). The Sub-Advisor shall report to
the Advisor and the Board regularly at such times and
in such detail as the Advisor or the Board may from
time to time request in order to permit the Advisor
and the Board to determine the adherence of the Fund
to its investment objectives, policies and
restrictions.
(b) The Sub-Advisor hereby agrees that upon the request
of the Board or the Advisor, copies of all records
pertaining to the Fund's investments will be provided
to Portico Funds or to such person as is designated
by Portico Funds. If a transfer of investment
advisory or sub-advisory services with respect to the
Fund should occur, the Sub-Advisor will promptly, and
at its own expense, take all steps necessary or
appropriate to segregate such
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records and deliver them to Portico Funds or to such
person as is designated by Portico Funds.
(c) Any investment decisions made by the Sub-Advisor on
behalf of the Fund shall be subject, in the
discretion of the Advisor, to review, approval or
ratification by the Advisor.
In acting hereunder, the Sub-Advisor shall be an independent
contractor and, unless otherwise expressly provided or
authorized hereunder or by the Board, shall have no authority
to act for or represent the Advisor, Portico Funds or the Fund
in any way or otherwise be an agent of the Advisor, Portico
Funds or the Fund.
2. The Sub-Advisor, at its own expense, shall provide all office
space, personnel and facilities necessary and incident to the
performance of the Sub-Advisor's services hereunder. The
Sub-Advisor may consult with counsel to the Fund and shall be
protected insofar as it acts in conformity with advice
rendered to it by such counsel. The fees and expenses of
counsel to the Fund shall be paid by the Fund.
3. The Sub-Advisor shall be responsible only for those expenses
expressly stated in paragraph 2 to be the responsibility of
the Sub-Advisor and shall not be responsible for any other
expenses of the Advisor, the Fund or Portico Funds, including,
as illustrative and without limitation, fees and charges of
any custodian (including charges as custodian and for keeping
books and records and similar services to Portico Funds and
the Fund); fees and expenses of directors; fees and expenses
of independent auditors, legal counsel, transfer agents,
dividend disbursing agents, and registrars; costs of and
incident to issuance, redemption and transfer of the Fund's
shares, and distributions to shareholders (including dividend
payments and reinvestment of dividends); brokers' commissions;
interest charges; taxes and corporate fees payable to any
government or governmental body or agency (including those
incurred on account of the registration or qualification of
securities issues by Portico Funds); dues and other expenses
incident to Portico Funds' membership in the Investment
Company Institute and other like associations; costs of stock
certificates, shareholder meetings, corporate reports, reports
and notices to shareholders; and costs of printing, stationery
and bookkeeping forms.
4. The Sub-Advisor shall not purchase or sell securities for the
Fund in any transaction in which the Sub-Advisor or any
affiliate of the Sub-Advisor is acting as broker or dealer.
The Sub-Advisor may, with the prior consent of the Advisor,
utilize Portico Funds' distributor or the Advisor or an
affiliate of the Advisor as a broker, including as a principal
broker, provided that the brokerage transactions and
procedures are in accordance with Rule 17e-1 under the
Investment Company Act of 1940, as amended (the "Act"), other
applicable provisions, if any, of the Act, and the
then-effective Registration Statement of Portico Funds under
the Securities Act of 1933, as amended. All allocation of
portfolio transactions shall
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be subject to such policies and supervision as the Board or
any committee thereof deem appropriate and any brokerage
policy set forth in the then-current Registration Statement of
Portico Funds as provided to the Sub-Advisor. The Sub-Advisor
shall provide to the Advisor and the Board such reports in
respect to placement of security transactions for the Fund as
the Advisor or the Board may reasonably request. The
Sub-Advisor also shall provide to the Advisor and the Board
such reports assessing the likelihood, if any, of
expropriation, nationalization, freezes or confiscation of the
Fund's assets in each country in which it invests; foreseeable
difficulties, if any, in converting the Fund's cash and cash
equivalents into U.S. dollars; and similar matters, as the
Advisor or the Board may reasonably request in order to assist
the Board in making the determinations required to be made by
it pursuant to Rule 17f-5 under the Act.
5. For the services provided and the expenses assumed by the
Sub-Advisor pursuant to this Agreement, the Advisor will pay
to the Sub-Advisor as full compensation therefor a fee based
on an annual rate of [ ]. This fee will be computed
based on net assets at the beginning of each day and will be
paid to the Sub-Advisor monthly on or before the fifteenth day
of the month next succeeding the month for which the fee is
paid. The fee shall be prorated for any fraction of a fiscal
year at the commencement and termination of this Agreement.
Anything to the contrary herein notwithstanding, the
Sub-Advisor may at any time and from time to time waive any
part or all of any fee payable to it pursuant to this
Agreement.
6. Services of the Sub-Advisor herein provided are not to be
deemed exclusive, and the Sub-Advisor shall be free to render
similar services or other services to others so long as its
services hereunder shall not be impaired thereby.
The Sub-Advisor agrees to indemnify the Fund, Portico Funds
and the Advisor with respect to any loss, liability, judgment,
cost or penalty which the Fund, Portico Funds or the Advisor
may directly or indirectly suffer or incur in any way arising
out of or in connection with any material breach of this
Agreement by the Sub-Advisor. The Advisor agrees to indemnify
the Sub-Advisor with respect to any loss, liability, judgment,
cost or penalty which the Sub-Advisor may directly or
indirectly suffer or incur in any way arising out of the
performance of its duties under this Agreement, except as
provided in the following paragraph.
The Sub-Advisor shall be liable for any neglience or willful
misconduct on the part of the Sub-Advisor or any of its
directors, officers, employees, representatives or agents in
connection with the responsibilities assumed by it hereunder,
provided, however, that the Sub-Advisor shall not be liable
for any investments made by the Sub-Advisor in accordance with
the explicit or implicit direction of the Board of Directors
of Portico Funds or the Advisor, or in accordance with the
investment objectives and policies of the Fund as set forth in
the then current Registration Statement of Portico Funds, and
provided further that any liability of the Sub-Advisor
resulting from a breach of fiduciary duty
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with respect to the receipt of compensation for services shall
be limited to the period and amount set forth in Section
36(b)(3) of the Act. The Sub-Advisor shall not be entitled to
indemnity for any loss, liability, judgment, cost or penalty
resulting negligence or willful misconduct on the part of the
Sub-Advisor or any of its directors, officers, employees,
representatives or agents in connection with the
responsibilities assumed by it hereunder.
7. The Sub-Advisor represents, warrants and agrees that the
Sub-Advisor is registered as an "investment adviser" under the
Investment Advisers Act of 1940, as amended (the "Advisers
Act"), and is and shall continue at all times to be in
compliance in all material respects with the requirements
imposed upon it by the Advisers Act. The Sub-Advisor agrees to
(a) supply the Advisor with such documents as the Advisor may
reasonably request to document the Sub-Advisor's compliance
with such laws and regulations, and (b) immediately notify the
Advisor of the occurrence of any event which would disqualify
the Sub-Advisor from serving as an investment adviser of an
investment company pursuant to any applicable law or
regulation. The Sub-Advisor will furnish to the Advisor a copy
of any amendment to the Sub-Advisor's Form ADV promptly
following the filing of such amendment with the Securities and
Exchange Commission.
8. The Advisor and the Sub-Advisor each represents and warrants
that it has the power to execute and deliver this Agreement
and any other documentation relating hereto and to perform its
respective obligations under this Agreement and that it has
taken all necessary action to authorize such execution,
delivery and performance. Such execution, delivery and
performance do not violate or conflict with any law applicable
to the Advisor or the Sub-Advisor, respectively, any order or
judgment of any court or other governmental agency, or any
contractual restriction binding on or affecting the Advisor or
the Sub-Advisor, respectively. The obligations of the Advisor
and the Sub-Advisor, respectively, under this Agreement
constitute their respective legal, valid and binding
obligations, enforceable against each of them in accordance
with the terms hereof.
9. The effective date of this Agreement shall be the date set
forth in the first paragraph hereof. Unless sooner terminated
as hereinafter provided, this Agreement shall continue in
effect for a period of more than two years from the date of
its execution but only as long as such continuance is
specifically approved at least annually by (a) the Board or by
the vote of a majority of the outstanding shares of the Fund
and (b) the vote of a majority of the directors, who are not
parties to this Agreement or "interested persons" (as defined
in the Act) of the Advisor, of the Sub-Advisor or of Portico
Funds, cast in person at a meeting called for the purpose of
voting on such approval.
10. This Agreement may be terminated at any time, without the
payment of any penalty, by the Board or by the vote of a
majority of the outstanding shares of the Fund, or by the
Advisor or the Sub-Advisor, upon 60 days' written notice to
the other parties.
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This Agreement shall automatically terminate in the event of
its "assignment" (as defined in the Act), provided, however,
that such automatic termination shall be prevented in a
particular case by an order of exemption from the Securities
and Exchange Commission or a no-action letter of the staff of
the Commission to the effect that such assignment does not
require termination as a statutory or regulatory matter.
11. This Agreement may be modified by mutual consent, such consent
only to be authorized by a majority of the directors of
Portico Funds who are not parties to this Agreement or
"interested persons" (as defined in the Act) of the Advisor,
of the Sub-Advisor or of Portico Funds and the vote of a
majority of the outstanding shares of the Fund; provided,
however, that no such authorization by shareholders of the
Fund shall be required if an order of exemption is received
from the Securities and Exchange Commission to the effect that
a modification to this Agreement does not require shareholder
approval.
12. Wherever referred to in this Agreement, the vote or approval
of the holders of a majority of the outstanding shares of the
Fund shall mean the lesser of (a) the vote of 67% or more of
the shares of the Fund at a meeting where more than 50% of the
outstanding shares are present in person or by proxy, or (b)
the vote of more than 50% of the outstanding shares of the
Fund.
13. If any provision of this Agreement shall be held or made
invalid by a court decision, statute, rule or otherwise, the
remainder shall not be thereby affected.
14. Any notice under this Agreement shall be in writing,
addressed, delivered or mailed, postage prepaid, to the other
party at such address as such other party may designate in
writing for receipt of such notice.
15. The internal law, and not the law of conflicts, of the State
of Minnesota will govern all questions concerning the
construction, validity and interpretation of this Agreement
and the performance of the obligations imposed by this
Agreement.
16. This Agreement constitutes the entire agreement between the
parties concerning its subject matter and supersedes all prior
and contemporaneous agreements, representations and
understandings of the parties.
IN WITNESS WHEREOF, the Advisor and the Sub-Advisor have caused this
Agreement to be executed by their duly authorized officers as of the
day and year first above written.
U.S. BANCORP XXXXX XXXXXXX ASSET
MANAGEMENT, INC.
By
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Its
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VOYAGEUR ASSET MANAGEMENT, INC.
By
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Its
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