ALPHA ANALYTICS INVESTMENT GROUP, LLC
SUB-ADVISER AGREEMENT
SUB-ADVISER AGREEMENT executed as of December 8, 1998 between ALPHA ANALYTICS
INVESTMENT GROUP, LLC (the "Adviser") and CAMBIAR INVESTORS, INC. (the "Sub-
Adviser").
WITNESSETH:
That in consideration of the mutual covenants herein contained, it is agreed as
follows:
1. SERVICES TO BE RENDERED BY SUB-ADVISER TO THE TRUST
(a) Subject always to the control of the Trustees of Alpha Analytics
Investment Trust (the "Trust"), an Ohio business trust, the Sub-Adviser,
at its expense, will furnish continuously an investment program for the
Alpha Analytics Value Fund (the "Fund"), a series of shares of the
Trust. The Sub-Adviser will use its best judgement to make investment
decisions on behalf of the Fund, place all orders for the purchase and
sale of portfolio securities and execute all agreements related thereto.
In the performance of its duties, the Sub-Adviser will comply with the
provisions of the Agreement and Declaration of Trust and By-laws of the
Trust and the objective and policies of the Fund, as set forth in the
then-current Registration Statement of the Trust filed with the
Securities and Exchange Commission ("SEC") and any applicable federal
and state laws, and will comply with other policies which the Trustees
of the Trust (the "Trustees") or the Adviser, as the case may be, may
from time to time determine and which are furnished to the Sub-Adviser.
The Sub-Adviser shall make its officers and employees available to the
Adviser from time to time at reasonable times to review investment
policies of the Fund and to consult with the Adviser regarding the
investment affairs of the Fund. The Sub-Adviser will provide the Trust's
custodian with such information relating to the Trust as may be required
under the terms of the then-current custody agreement between the Trust
and the custodian. In the performance of its duties hereunder, the
Sub-Adviser is and shall be an independent contractor and, unless
otherwise expressly provided or authorized, shall have no authority to
act for or represent the Trust in any way or otherwise be deemed to be
an agent of the Trust.
(b) The Sub-Adviser will maintain books and records with respect to the
securities transactions of the Fund and shall render to the Adviser such
periodic and special reports as the Adviser or the Trustees may request.
The Sub-Adviser agrees that all records which it maintains for the Trust
are the property of the Trust and it will promptly surrender any of such
records to the Trust upon the Trust's request. The Sub- Adviser further
agrees to preserve, for the periods prescribed by Rule 31a-2 under the
Investment Company Act of 1940, as amended ("1940 Act"), any such
records as are required to be maintained by the Sub-Adviser with respect
to the Trust by Rule 31a-1 under the 1940 Act.
(c) During the term of this Agreement, the Sub-Adviser will pay all expenses
incurred by it in connection with its activities under this Agreement
other than the cost of securities and investments purchased for the Fund
(including taxes and brokerage commissions, if any).
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2. BROKERAGE
In placing orders with brokers and/or dealers, the Sub-Adviser is
directed at all times to seek best qualitative execution for purchases
and sales on behalf of the Fund, taking into account such factors as
price (including the applicable brokerage commission or dealer spread),
the execution capability, financial responsibility and responsiveness of
the broker or dealer and the brokerage and research services provided by
the broker or dealer. Sub-Adviser should generally seek favorable prices
and commission rates that are reasonable in relation to the benefits
received. Subject to such conditions as may be imposed by the Trust's
Board of Trustees, the Sub-Adviser may pay commissions to brokers and/or
dealers that are higher than might be charged by another qualified
broker to obtain brokerage and/or research services (as those terms are
defined in Section 28(e) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act")) considered by the Sub-Adviser to be useful
or desirable in the performance of the Sub-Adviser's duties hereunder,
if the Sub-Adviser determines in good faith that the amount of the
commission is reasonable in relation to the value of the brokerage and
research services provided by the executing broker or dealer. The
determination may be viewed in terms of either a particular transaction
or Sub-Adviser's overall responsibilities with respect to the Fund and
to accounts over which Sub-Adviser exercises investment discretion. The
Fund and the Sub-Adviser understand and acknowledge that, although the
information may be useful to the Fund and the Sub-Adviser, it is not
possible to place a dollar value on such information. The Board shall
periodically review the commissions paid by the Fund to determine if the
commissions paid over representative periods of time were reasonable in
relation to the benefits to the Fund.
Consistent with the Rules of Fair Practice of the National Association
of Securities Dealers, Inc., and subject to seeking best qualitative
execution as described above, the Sub-Adviser may give consideration to
sales of shares of the Fund as a factor in the selection of brokers and
dealers to execute Fund portfolio transactions.
Subject to the foregoing and to such conditions as may be imposed by the
Adviser or the Trust's Board of Trustees and the provisions of the 1940
Act, Exchange Act, and other applicable law, nothing herein shall
prohibit the Sub-Adviser from selecting brokers and/or dealers who are
"affiliated persons" of the Sub-Adviser, the Adviser or the Trust. On
occasions when the Sub-Adviser deems the purchase or sale of a security
to be in the best interest of the Fund as well as other customers, the
Sub-Adviser may, to the extent permitted by applicable laws and
regulations, but shall not be obligated to, aggregate the securities to
be so sold or purchased in order to obtain the best execution and lower
brokerage commissions, if any. 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 Fund and, if applicable, to such other customers.
If any occasion should arise in which the Sub-Adviser gives any advice
to clients of Sub- Adviser concerning the shares of the Fund,
Sub-Adviser will act solely as investment counsel for such client and
not in any way on behalf of the Fund.
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3. OTHER AGREEMENTS
It is understood that any of the shareholders, Trustees, officers and
employees of the Trust may be a shareholder, member, director, officer
or employee of, or be otherwise interested in, the Sub-Adviser, and in
any person controlled by or under common control with the Sub-Adviser,
and that the Sub-Adviser and any person controlled by or under common
control with the Sub- Adviser may have an interest in the Trust. It is
also understood that the Sub-Adviser and persons controlled by or under
common control with the Sub-Adviser have and may have advisory,
management service or other contracts with other organizations and
persons, and may have other interests and businesses.
4. COMPENSATION TO BE PAID BY THE ADVISER TO THE SUB-ADVISER
The Adviser will pay to the Sub-Adviser as compensation for the
Sub-Adviser's services rendered, a fee, determined as described in
Schedule A which is attached hereto and made a part hereof. Such fee
shall be paid by the Adviser and not by the Trust.
5. AMENDMENT OF THIS AGREEMENT
No provision of this Agreement (including Schedule A attached hereto)
may be changed, waived, discharged or terminated orally, and no
amendment of this Agreement (including Schedule A attached hereto) shall
be effective until approved by the Board, including a majority of the
trustees who are not interested persons of the Adviser, the Sub-Adviser
or the Trust, cast in person at a meeting called for the purpose of
voting on such approval, and (if required under interpretations of the
1940 Act by the Securities and Exchange Commission or its staff) by vote
of the holders of a majority of the outstanding voting securities of the
series to which the amendment relates.
6. EFFECTIVE PERIOD AND TERMINATION OF THIS AGREEMENT
(a) Unless terminated as herein provided, this Agreement shall remain in
full force and effect for a period of two years from the date of its
execution, and shall continue in full force and effect for
successive periods of one year thereafter, but only so long as such
continuance is specifically approved at least annually (i) by the
Trustees or by the affirmative vote of a majority of the outstanding
voting securities of the Fund, and (ii) by a vote of a majority of
the Trustees who are not interested persons of the Trust or of the
Adviser or of any Sub-Adviser, by vote cast in person at a meeting
called for the purpose of voting on such approval; provided,
however, that if the continuance of this Agreement is submitted to
the shareholders of the Fund for their approval and such
shareholders fail to approve such continuance of this Agreement as
provided herein, the Sub-Adviser may continue to serve hereunder in
a manner consistent with the 1940 Act and the rules and regulations
thereunder.
(b) This Agreement may be terminated at any time without the payment of
any penalty (i) by the Adviser, (ii) by vote of the Trustees, (iii)
by vote of a majority of the outstanding voting securities of the
Fund or (iv) by the Sub-Adviser, in each case on sixty days' written
notice.
(c) This Agreement shall terminate automatically, without the payment of
any penalty, in the event of its assignment or in the event that the
Management Agreement with the Adviser shall have terminated for any
reason.
(d) In the event of termination of this Agreement, the Fund will no
longer use the name "Cambiar Investors, Inc." in materials relating
to the Fund except as may be required by the 1940 Act and the rules
and regulations thereunder. All rights to the name "Alpha Analytics"
belong to the Adviser.
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7. CERTAIN DEFINITIONS
For the purposes of this Agreement, the terms "vote of a majority of the
outstanding voting securities," "control," "interested person" and
"assignment" shall have their respective meanings defined in the 1940
Act and rules and regulations thereunder, subject, however, to such
exemptions as may be granted by the SEC under said Act; the term
"specifically approve at least annually" shall be construed in a manner
consistent with the 1940 Act and the rules and regulations thereunder;
and the term "brokerage and research services" shall have the meaning
given in the Exchange Act and the rules and regulations thereunder.
8. NON-LIABILITY OF SUB-ADVISER
Neither the Sub-Adviser nor its shareholders, officers, directors,
employees, agents, control persons or affiliates of any thereof, shall
be liable for any error of judgment or mistake of law or for any loss
suffered by any Fund in connection with the matters to which this
Agreement relates except a loss resulting from a breach of fiduciary
duty with respect to the receipt of compensation for services or 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, except as otherwise
may be required by the 1940 Act.
9. LIMITATION OF LIABILITY OF THE TRUSTEES AND SHAREHOLDERS
A copy of the Trust's Agreement and Declaration of Trust is on file with
the Secretary of the State of Ohio, and notice is hereby given that this
instrument is executed by the Trustees as Trustees and not individually
and that the obligations of this instrument are not binding upon any of
the Trustees, officers or shareholders individually but are binding only
upon the assets and property of the Fund.
10. SEVERABILITY
In the event any provision of this Agreement is determined to be void or
unenforceable, such determination shall not affect the remainder of this
Agreement, which shall continue to be in force.
11. QUESTIONS OF INTERPRETATION
(a) This Agreement shall be governed by the laws of the State of
Ohio.
(b) 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 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 the Securities and
Exchange Commission or its staff. In addition, where the effect
of a requirement of the 1940 Act, reflected in any provision of
this Agreement is revised by rule, regulation, order or
interpretation of the Securities and Exchange Commission or its
staff, such provision shall be deemed to incorporate the effect
of such rule, regulation, order or interpretation.
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12. NOTICES
Any notices under this Agreement shall be in writing, addressed and
delivered or mailed postage paid to the other party at such address as
such other party may designate for the receipt of such notice. Until
further notice to the other party, it is agreed that the address of the
Trust and the Adviser is 0000 Xxxxxx xx xxx Xxxxx, Xxxxx 000, Xxx
Xxxxxxx, XX 00000, and the address of the Sub-Adviser is 0000 Xxxx
Xxxxxxxx Xxxxxx, Xxxxx 000, Xxxxxxxxx, XX 00000.
13. COUNTERPARTS
This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
14. BINDING EFFECT
Each of the undersigned expressly warrants and represents that he has
the full power and authority to sign this Agreement on behalf of the
party indicated, and that his signature will operate to bind the party
indicated to the foregoing terms.
15. CAPTIONS
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.
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IN WITNESS WHEREOF, the parties have caused this instrument to be signed by
their officers designated below, all as of the day and year first above written.
ALPHA ANALYTICS INVESTMENT GROUP, LLC
By:/s/ XXXXXX X. XXXXXX
--------------------
Xxxxxx X. Xxxxxx
President
CAMBIAR INVESTORS, INC.
By:/s/ XXXXXXX X. XXXX
---------------------
Xxxxxxx X. Xxxx
Vice President
By signature below, the Trust acknowledges, as of the day and year first above
written, that the Sub- Adviser Agreement has been approved by the Trust as
required by the 1940 Act.
ALPHA ANALYTICS INVESTMENT TRUST
By:/s/ XXXXXX X. XXXXXX
--------------------
Xxxxxx X. Xxxxxx
President
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SCHEDULE A
DATED DECEMBER 8, 1998
The Manager will pay to the Sub-Adviser as full compensation for the
Sub-Adviser's services rendered, a fee computed daily and paid quarterly at an
annual rate of 0.50% of the average daily net assets of the Fund.
The average daily net assets of the Fund shall be determined by taking an
average of all of the determinations of net asset value during each month at the
close of business on each business day during such month while this Agreement is
in effect. Net asset value shall be calculated in the manner specified in the
Trust's Prospectus.
The fee for each quarter shall be payable within ten (10) business days after
the end of the quarter.
If the Sub-Adviser shall serve for any period less than a full month, the
foregoing compensation shall be prorated according to the proportion which such
period bears to a full month.
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