EXHIBIT 5 (c)
NORWEST FUNDS
INVESTMENT SUBADVISORY AGREEMENT
AGREEMENT made this 26th day of July, 1994, among Norwest Funds (the
"Trust"), a business trust organized under the laws of the State of Delaware
with its principal place of business at 00 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Norwest Bank Minnesota, N.A. (the "Adviser"), a corporation organized under the
laws of State of Delaware with its principal place of business at Xxxxx Xxxxxx
xxx Xxxxxxxxx, Xxxxxxxxxxx, Xxxxxxxxx 00000 and Crestone Capital Management,
Inc. (the "Subadviser"), a corporation organized under the laws of the State of
Colorado with its principal place of business at 0000 Xxxx XxxxxXxxx Xxxxxx,
Xxxxxxxxx, Xxxxxxxx 00000.
WHEREAS, the Trust is registered under the Investment Company Act of 1940,
as amended, (the "Act") as an open-end management investment company and is
authorized to issue its shares of beneficial interest, no par value, in separate
series and classes; and
WHEREAS, the Trust and the Adviser desire that the Subadviser perform
investment advisory services for the Small Company Stock Fund (the "Fund") and
the Subadviser is willing to provide those services on the terms and conditions
set forth in this Agreement;
NOW THEREFORE, the Trust, the Adviser and the Subadviser agree as follows:
SECTION 1. THE TRUST; DELIVERY OF DOCUMENTS
The Trust is engaged in the business of investing and reinvesting its
assets in securities of the type and in accordance with the limitations
specified in its Trust Instrument, By-Laws and Registration Statement filed with
the Securities and Exchange Commission (the "Commission") under the Act and the
Securities Act of 1933 (the "Securities Act"), including any representations
made in the prospectus and statement of additional information relating to the
Fund contained therein and as may be supplemented from time to time, all in such
manner and to such extent as may from time to time be authorized by the Trust's
Board of Trustees (the "Board"). The Trust is currently authorized to issue
thirty-one series of shares and the Board is authorized to issue any unissued
shares in any number of additional classes or series. The Trust has delivered
copies of the documents listed in this Section 1 and will from time to time
furnish Subadviser with any amendments thereof.
SECTION 2. INVESTMENT ADVISER; APPOINTMENT
Subject to the direction and control of the Board, the Adviser manages the
investment and reinvestment of the assets of the Fund and provides for certain
management and services as specified in the Investment Advisory Agreement
between the Trust and the Adviser with respect to the Fund.
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Subject to the direction and control of the Board, the Subadviser shall
manage the investment and reinvestment of the assets of the Fund and, without
limiting the generality of the foregoing, shall provide the management and other
services specified below, all in such manner and to such extent as may be
directed from time to time by the Adviser.
SECTION 3. DUTIES OF THE SUBADVISER
(a) The Subadviser shall make decisions with respect to all purchases and
sales of securities and other investment assets in the Fund. To carry out such
decisions, the Subadviser is hereby authorized, as agent and attorney-in-fact
for the Trust, for the account of, at the risk of and in the name of the Trust,
to place orders and issue instructions with respect to those transactions of the
Fund. In all purchases, sales and other transactions in securities for the
Fund, the Subadviser is authorized to exercise full discretion and act for the
Trust in the same manner and with the same force and effect as the Trust might
or could do with respect to such purchases, sales or other transactions, as well
as with respect to all other things necessary or incidental to the furtherance
or conduct of such purchases, sales or other transactions.
(b) The Subadviser will report to the Board at each meeting thereof all
changes in the Fund since the prior report, and will also keep the Board
informed of important developments affecting the Trust, the Fund and the
Subadviser, and on its own initiative, will furnish the Board from time to time
with such information as the Subadviser may believe appropriate for this
purpose, whether concerning the individual companies whose securities are
included in the Fund's holdings, the industries in which they engage, or the
economic, social or political conditions prevailing in each country in which the
Fund maintains investments. The Subadviser will also furnish the Board with
such statistical and analytical information with respect to securities in the
Fund as the Subadviser may believe appropriate or as the Board reasonably may
request. In making purchases and sales of securities for the Fund, the
Subadviser will bear in mind the policies set from time to time by the Board as
well as the limitations imposed by the Trust's Trust Instrument, By-Laws,
Registration Statement under the Act and the Securities Act, the limitations
in the Act and in the Internal Revenue Code of 1986, as amended in respect of
regulated investment companies and the investment objectives, policies and
restrictions of the Fund.
(c) The Subadviser may from time to time employ or associate with such
persons as the Subadviser believes to be particularly fitted to assist in the
execution of the Subadviser's duties hereunder, the cost of performance of such
duties to be borne and paid by the Subadviser. No obligation may be incurred on
the Trust's behalf in any such respect.
(d) The Subadviser shall maintain records relating to portfolio
transactions and the placing and allocation of brokerage orders as are required
to be maintained by the Trust under the Act. The Subadviser shall prepare and
maintain, or cause to be prepared and maintained, in such form, for such periods
and in such locations as may be required by applicable law, all documents and
records relating to the services provided by the Subadviser pursuant to this
Agreement required to be prepared and maintained by the Trust pursuant to the
rules and regulations of any national, state, or local government entity with
jurisdiction over the Trust, including the Securities and Exchange Commission
and the Internal Revenue Service. The books and records pertaining
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to the Trust which are in possession of the Subadviser shall be the property of
the Trust. The Trust, or the Trust's authorized representatives, shall have
access to such books and records at all times during the Subadviser's normal
business hours. Upon the reasonable request of the Trust, copies of any such
books and records shall be provided promptly by the Subadviser to the Trust
or the Trust's authorized representatives.
SECTION 4. EXPENSES
Subject to any expenses reimbursement arrangements between the Adviser or
others and the Trust, the Trust shall be responsible and shall assume the
obligation for payment of all of the Trust's expenses.
SECTION 5. STANDARD OF CARE
The Trust shall expect of the Subadviser, and the Subadviser will give the
Trust the benefit of, the Subadviser's best judgment and efforts in rendering
its services to the Trust, and as an inducement to the Subadviser's undertaking
these services the Subadviser shall not be liable hereunder for any mistake of
judgment or in any event whatsoever, except for lack of good faith, provided
that nothing herein shall be deemed to protect, or purport to protect, the
Subadviser against any liability to the Trust or to the Trust's security holders
to which the Subadviser would otherwise be subject by reason of willful
misfeasance, bad faith or gross negligence in the performance of the
Subadviser's duties hereunder, or by reason of the Subadviser's reckless
disregard of its obligations and duties hereunder.
SECTION 6. COMPENSATION
In consideration of the foregoing, the Adviser and not the Trust shall pay
the Subadviser a fee as shall be determined from time to time in writing
between the Adviser and the Subadviser; provided, that no fee shall be paid to
the Subadviser by the Adviser from the date hereof until the date on which
shareholders of the Fund approve this Agreement.
SECTION 7. EFFECTIVENESS, DURATION AND TERMINATION
(a) This Agreement shall become effective on the date first above written.
(b) This Agreement shall remain in effect for a period of one year from
the date of its effectiveness and shall continue in effect for successive
twelve-month periods (computed from each anniversary date of the approval);
provided that such continuance is specifically approved at least annually (i) by
the Board or by the vote of a majority of the outstanding voting securities of
the Fund, and, in either case, (ii) by a majority of the Trust's trustees who
are not parties to this Agreement or interested persons of any such party (other
than as trustees of the Trust); provided further, however, that if this
Agreement or the continuation of this Agreement is not approved, the Subadviser
may continue to render the services described herein in the manner and to the
extent permitted by the Act and the rules and regulations thereunder.
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(c) This Agreement may be terminated at any time, without the payment of
any penalty, (i) by the Board or by a vote of a majority of the outstanding
voting securities of the Fund on 60 days' written notice to the Subadviser or
(ii) by the Subadviser on 60 days' written notice to the Trust. This agreement
shall terminate upon assignment unless prior approval of the Board is obtained.
SECTION 8. ACTIVITIES OF THE SUBADVISER
Except to the extent necessary to perform its obligations hereunder,
nothing herein shall be deemed to limit or restrict the Subadviser's right, or
the right of any of the Subadviser's officers, directors or employees who may
also be a trustee, officer or employee of the Trust, or persons otherwise
affiliated persons of the Trust to engage in any other business or to devote
time and attention to the management or other aspects of any other business,
whether of a similar or dissimilar nature, or to render services of any kind to
any other corporation, trust, firm, individual or association.
SECTION 9. LIMITATION OF SHAREHOLDER AND TRUSTEE LIABILITY
The Trustees of the Trust and the shareholders of the Fund shall not be
liable for any obligations of the Trust or of the Fund under this Agreement, and
the Subadviser agrees that, in asserting any rights or claims under this
Agreement, it shall look only to the assets and property of the Trust or the
Fund to which the Subadviser's rights or claims relate in settlement of such
rights or claims, and not to the Trustees of the Trust or the shareholders of
the Fund.
SECTION 10. MISCELLANEOUS
(a) No provisions of this Agreement may be amended or modified in any
manner except by a written agreement properly authorized and executed by both
parties hereto and, if required by the Act, by a vote of a majority of the
outstanding voting securities of the Fund thereby affected.
(b) Section headings in this Agreement are included for convenience only
and are not to be used to construe or interpret this Agreement.
(c) This Agreement shall be governed by and shall be construed in
accordance with the laws of the State of Delaware.
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(d) The terms "vote of a majority of the outstanding voting securities",
"interested person", "affiliated person" and "assignment" shall have the
meanings ascribed thereto in the Act.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed all as of the day and year first above written.
NORWEST FUNDS
/S/ XXXX X. XXXXXX
--------------------------
Xxxx X. Xxxxxx
President
NORWEST BANK MINNESOTA, N.A.
/S/ XXX XXXXXXXXXX
--------------------------
Xxx Xxxxxxxxxx
Executive Vice President
CRESTONE CAPITAL MANAGEMENT, INC.
/S/ XXXX XXXXXX
-------------------------------
Xxxx XxXxxx
President
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NORWEST FUNDS
INVESTMENT SUBADVISORY AGREEMENT
FEE AGREEMENT
This fee agreement is made as of the 26th day of July, 1994 by and between
Crestone Capital Management, Inc. ("Crestone") and Norwest Bank Minnesota, N.A.
("Norwest").
WHEREAS, the parties have entered into a Norwest Funds Investment
Subadvisory Agreement ("Subadvisory Agreement") whereby Crestone provides
investment management advice to Norwest;
WHEREAS, the Subadvisory provide that the fees to be paid Crestone are to
be as agreed upon in writing by the parties.
NOW THEREFORE, the parties agree that the fees to be paid Crestone under
the Subadvisory Agreement shall be calculated as follows on a monthly basis by
applying the following annual percentage rates to the assets managed by Crestone
pursuant to said Subadvisory Agreement:
a. 0.0040 on the first $30,000,000.00;
b. 0.0030 on the next $30,000,000.00;
c. 0.0020 on the next $40,000,000.00; and
d. 0.0015 on all sums in excess of $100,000,000.00;
provided, however, that no fee shall be paid to Crestone by Norwest for
Crestone's services on behalf of Small Company Stock Fund (the "Fund"), a
separate portfolio of Norwest Funds (the "Trust"), from the date hereof until
the date on which shareholders of the Fund approve the "Norwest Funds Investment
Subadvisory Agreement" among the Trust, Norwest and Crestone.
The net assets under management against which the foregoing fees are to be
applied is the month-end average of net assets, determined at the end of each
month by dividing the sum of the average net assets managed by Crestone at the
end of each week during the month by the number of weeks ended during the
calendar month. The assets for each weekly period are determined by averaging
the net assets under management at the close of each business day for each
business day in the week that this agreement is in effect. If this agreement
becomes effective subsequent to the first day of a month or shall terminate
before the last day of a month, compensation for that part of the month this
Agreement is in effect shall be subject to a pro rata adjustment based on the
number of days elapsed in the current month as a percentage of the total number
of days in such month. During any period when the determination of net asset
value is suspended, the average net asset value for the last day prior to such
suspension shall for this purpose be deemed to be the average net asset value at
the close of each succeeding week until it is again determined.
The foregoing fee schedule shall remain in effect until changed in writing
by the parties.
NORWEST BANK MINNESOTA, N.A.
/s/ Xxx Xxxxxxxxxx
Xxx Xxxxxxxxxx
Executive Vice President
CRESTONE CAPITAL MANAGEMENT, INC.
/s/ Xxxx Xx Xxxx
Xxxx XxXxxx
President
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