AMENDED AND RESTATED INVESTMENT SUB-ADVISORY AGREEMENT
THIS AMENDED AND RESTATED AGREEMENT is made and entered into this 29th day
of April 2005 by and among STATE FARM MUTUAL FUND TRUST, a Delaware business
trust (the "Trust"), STATE FARM INVESTMENT MANAGEMENT CORP., a Delaware
corporation (the "Adviser"), and CAPITAL GUARDIAN TRUST COMPANY (the
"Sub-Adviser"), relates to investment management services to be provided by the
Sub-Adviser.
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, the Trust issues shares of beneficial interest (the "shares")
registered under the Securities Act of 1933, as amended (the "1933 Act")
pursuant to a registration statement initially filed with the Securities and
Exchange Commission on July 21, 2000, as amended from time to time (the
"Registration Statement");
WHEREAS, the Trust has established multiple separate series of Shares, each
corresponding to a separate investment portfolio having its own investment
objective (the "Funds");
WHEREAS, pursuant to a separate investment advisory and management services
agreement between the Trust and the Adviser (the "Advisory Agreement"), the
Trust has retained the Adviser to render investment advisory and/or management
services to each Fund;
WHEREAS, the Sub-Adviser is an investment adviser under the Investment
Advisers Act of 1940, as amended (the "Advisers Act");
WHEREAS, the Adviser desires to retain the Sub-Adviser to provide
investment advisory services to certain Funds in the manner and on the terms and
conditions set forth below; and
WHEREAS, the Sub-Adviser is willing to provide investment advisory services
to certain Funds in the manner and on the terms and conditions set forth below;
and
NOW, THEREFORE, in consideration of their mutual promises, the Trust, the
Adviser, and the Sub-Adviser agree as follows:
1
ARTICLE 1
Employment of Sub-adviser
1.1 The Adviser hereby appoints the Sub-Adviser to act as investment
sub-adviser for and to invest and reinvest the assets of the State Farm Equity
Fund, the State Farm Small Cap Equity Fund and the State Farm International
Equity Fund, (together, the "Sub-Advised Funds"), subject to the supervision and
control of the Board of Trustees of the Trust (the "Board") for the period and
upon the terms herein set forth. The Sub-Adviser will establish and maintain a
discretionary investment management account (the "Account") for each Sub-Advised
Fund, consisting of securities, funds, or other assets contributed or
liabilities allocated, (i) as the Adviser shall initially designate for the
purposes of opening this Account, (ii) as the Adviser may from time to time
designate in writing to Sub-Adviser and (iii) as the Adviser may substitute
pursuant to this Agreement. The Sub-Adviser shall invest and reinvest the assets
of the Account at such times and in such securities as it believes to be in the
best interest of the shareholders of each Sub-Advised Fund.
1.2 The Sub-Adviser accepts such appointment and agrees during such
period at its own expense to render the services set forth herein, and to assume
the obligations herein set forth for the compensation herein provided.
1.3 The Sub-Adviser shall for all purposes be deemed to be an
independent contractor and, unless otherwise expressly provided or authorized,
shall have no authority to act for or represent the Trust or the Adviser in any
way or otherwise be deemed an agent of the Trust or the Adviser. Notwithstanding
the foregoing, the Sub-Adviser shall, for the purposes of this agreement, have
and exercise full investment discretion and authority to act as agent for the
Trust and the Adviser in buying, selling or otherwise disposing of the
investments of the Sub-Advised Funds, subject to supervision by the Board.
1.4 The services of the Sub-Adviser herein provided are not to be
deemed exclusive. The Sub-Adviser may act as an investment adviser to any other
person, firm or corporation, and may perform management and any other services
for any other person, association, corporation, firm or other entity pursuant to
any contract or otherwise, and take any action or do anything in connection
therewith or related thereto, except as prohibited by applicable law; and no
such performance of management or other services shall be in any manner
restricted or otherwise affected by any aspect of any relationship of the
Sub-Adviser to the Trust, the Sub-Advised Funds or the Adviser except as
otherwise imposed by law or by this agreement. The Sub-Adviser shall have no
obligation to purchase or sell for a Sub-Advised Fund, or to recommend for
purchase or sale by a Sub-Advised Fund, any security which Sub-Adviser, its
2
principles, affiliates or employees may purchase or sell for themselves or for
any other clients.
ARTICLE 2
Duties of Sub-Adviser
2.1 Investment Advisory Services.
(a) Subject to the supervision of the Board and the Adviser, the
Sub-Adviser shall provide the Sub-Advised Funds with such investment research,
advice and supervision as is necessary for the investment and proper supervision
of the assets of each Sub-Advised Fund. In this regard, the Sub-Adviser shall:
(i)perform research and obtain and evaluate pertinent
economic, statistical, and financial data relevant to the investments of each
Sub-Advised Fund as contemplated by the investment objectives and strategies of
each Sub-Advised Fund as set forth in the Registration Statement and any
amendments thereto;
(ii) at such times as shall be reasonably requested by the
Board or the Adviser, consult with the Board and furnish to the Board
recommendations with respect to an overall investment strategy for each
Sub-Advised Fund for approval, modification, or rejection by the Board;
(iii) seek out and implement specific investment
opportunities, consistent with any investment strategies approved by the Board;
(iv) take such steps as are necessary to implement any
overall investment strategy approved by the Board for each Sub-Advised Fund,
including making and carrying out day-to-day decisions to acquire or dispose of
permissible investments, management of investments and any other property of the
Sub-Advised Fund, and providing or obtaining such services as may be necessary
in managing, acquiring or disposing of investments;
(v) regularly report to the Board with respect to the
implementation of any approved overall investment strategy and any other
activities in connection with management of the assets of each Sub-Advised Fund,
including furnishing, within 10 days after the end of each calendar quarter, a
statement of all purchases and sales during the quarter and a schedule of
investments and other assets of each Sub-Advised Fund as of the end of the
quarter;
(vi) maintain all accounts, records, memoranda, instructions
or authorizations required to be maintained by the Sub-Adviser
3
pursuant to the requirements of Rule 31a-1 under the 1940 Act, for the period
required by Rule 31a-2 under the 1940 Act, with respect to transactions by the
Sub-Adviser on behalf of the Sub-Advised Funds;
(vii) provide reasonable assistance to the Custodian or the
Adviser regarding valuation of portfolio securities that the Custodian or
Adviser is unable to procure, so that the Custodian or Adviser can determine
each business day the net asset value of the shares of each Sub-Advised Fund in
accordance with applicable law; and
(viii) provide the Adviser with a report of each portfolio
trade no later than the close of the next business day following such trade.
(b) The Sub-Adviser's services shall be subject always to the
control and supervision of the Board and the Adviser, the restrictions of the
Declaration of Trust and Bylaws of the Trust, as amended from time to time, the
provisions of the 1940 Act, and each Sub-Advised Fund's investment objective or
objectives, investment policies and investment restrictions as set forth in the
then-current Registration Statement. The Trust or the Adviser has furnished or
will furnish the Sub-Adviser with copies of the Registration Statement,
Declaration of Trust, and Bylaws as currently in effect and the Trust agrees
during the continuance of this agreement to furnish the Sub-Adviser with copies
of any amendments or supplements thereto before or at the time the amendments or
supplements become effective. The Sub-Adviser will be entitled to rely on all
documents and other information furnished by the Trust or the Adviser or the
representatives of either.
(c) The Sub-Adviser represents that in performing investment
advisory services for each Sub-Advised Fund, the Sub-Adviser shall use its
reasonable best efforts to manage each Sub-Advised Fund's portfolio holdings in
a manner consistent with the requirements of Subchapter M of the Internal
Revenue Code of 1986 (the "Code"), or any successor provision. The Sub-Adviser
shall also make decisions for the Sub-Advised Funds as to the manner in which
voting rights, rights to consent to corporate action and any other rights
pertaining to the Sub-Advised Funds' portfolio securities shall be exercised.
Should the Board at any time make any determination as to investment policy and
notify the Sub-Adviser thereof in writing, the Sub-Adviser, upon receipt of such
notice, shall be bound by such determination for the period, if any, specified
in such written notice or until similarly notified that such determination has
been revoked.
(d) In connection with the acquisition or disposition of
securities described in Section 2.1(a)(iv), the Sub-Adviser may place orders for
the purchase or sale of portfolio investments for the account of each
Sub-Advised Fund with brokers or dealers selected by it and, to that end, the
Sub-
4
Adviser is authorized as the agent of the Trust to give instructions to the
custodians of the Trust as to deliveries of securities and payments of cash for
the Account of each Sub-Advised Fund. In connection with the selection of
brokers or dealers and the placing of purchase and sale orders with respect to
assets of the Funds, the Sub-Adviser is directed at all times to seek to obtain
best execution. Subject to this requirement and the provisions of the Advisers
Act, the 1940 Act, the 1934 Act, and other applicable provisions of law, the
Sub-Adviser may select brokers or dealers with which it or the Trust or the
Adviser is affiliated.
(e) In seeking the best execution, the Sub-Adviser may also take
into consideration research and statistical information and wire and other
quotation services provided by brokers and dealers to the Sub-Adviser. The
Sub-Adviser is authorized to effect individual securities transactions at
commission rates in excess of the minimum commission rates available, if the
Sub-Adviser determines in good faith that such amount of commission is
reasonable in relation to the value of the brokerage and research services
provided by such broker or dealer, viewed in terms of either that particular
transaction or Sub-Adviser's overall responsibilities with respect to the
Sub-Advised Funds and its other clients and that the total commissions paid by
each Sub-Advised Fund will be reasonable in relation to the benefits to the
Sub-Advised Fund over the long term. The execution of such transactions shall
not be deemed to represent an unlawful act or breach of any duty created by this
agreement or otherwise. The Sub-Adviser will periodically evaluate the
statistical data, research and other investment services provided to it by
brokers and dealers. Such services may be used by the Sub-Adviser in connection
with the performance of its obligations under this agreement or in connection
with other advisory or investment operations including using such information in
managing its own accounts.
In the event that any broker or dealer fails on the due date, or within such
reasonable period as the Sub-Adviser may decide, to deliver any necessary
documents or, as the case may be, to pay any amount due, the Sub-Adviser will,
on request, pursue on behalf of the Trust all appropriate legal remedies against
such broker or dealer to recover such documents or amount due or compensation in
lieu thereof. The costs and expenses properly incurred by the Sub-Adviser in
connection with the pursuit of such remedies shall be debited to the Sub-Advised
Fund, unless paid by the Adviser or Trust.
(f) Nothing in this agreement shall preclude the aggregation of
orders for the sale or purchase of securities or other investments by the
Sub-Advised Funds or by the Trust and other separate accounts or other accounts
(collectively, "Advisory Clients") managed by the Sub-Adviser, provided that:
the Sub-Adviser's actions with respect to the aggregation of orders for multiple
Advisory Clients, including the Trust, are consistent with the applicable
then-current positions in this regard taken by the Securities and Exchange
Commission or its staff through releases, "no-action" letters, or otherwise. The
5
Adviser and the Trust recognize that in some cases this procedure may adversely
affect the results obtained for Sub-Advised Funds.
2.2 The Adviser shall retain the authority to establish and modify,
from time to time, the investment strategies and approaches to be followed by
the Sub-Adviser with respect to any Sub-Advised Fund, subject, in all respects,
to the supervision and direction of the Trust's Board of Trustees and subject to
compliance with the investment objectives, policies and restrictions applicable
to such Fund as set forth in the Registration Statement or any amendment
thereto, provided, however, that the Sub-Adviser's duty under this agreement to
act in conformity with any document, instruction or guidelines produced by the
Adviser shall not arise until such document, instruction or guideline has been
delivered to the Sub-Adviser in writing.
2.3 The Sub-Adviser is not authorized to take or receive physical
possession of any of the assets of the Account, it being intended that sole
responsibility for safekeeping thereof (in such investments as the Sub-Adviser
may direct) and the consummation of all purchase, sales, deliveries and
investments made pursuant to the Sub-Adviser's direction shall rest upon the
custodian for the Sub-Advised Fund. The Sub-Adviser shall have no liability with
respect to the custody arrangements or the acts, conduct or omissions of such
custodian.
The Adviser shall provide such information about the Trust and its assets as the
Sub-Adviser may from time to time reasonably request in connection with the
performance of its duties under this Agreement. The Adviser acknowledges that
the Sub-Adviser will be relying on the Adviser's identification of any assets
contributed, or liabilities allocated, from time to time to the Account, as well
as their availability for sale as applicable. The Sub-Adviser may reasonably
rely without further inquiry upon any information furnished to it by the Adviser
hereunder, and the Sub-Adviser will not be responsible for any errors or
omissions arising from any inaccuracies in such information.
ARTICLE 3
Compensation of the Sub-Adviser
3.1 (a) For the services to be rendered, the facilities to be
furnished and the payments to be made, as provided herein, the parties hereto
agree that the Adviser shall pay to the Sub-Adviser for the calendar quarter of
each Sub-Advised Fund a fee computed in accordance with the Fee Schedule
attached hereto and incorporated herein. The payment shall be made by the
Adviser to the Sub-Adviser within three business days after the end of the
calendar quarter.
6
(b) The Adviser shall be responsible for payment of, and the
Sub-Adviser agrees that it shall have no claim against the Trust or any
Sub-Advised Fund respecting, the Sub-Adviser's compensation under this
agreement.
(c) During the term of this agreement, the Sub-Adviser will bear
all expenses incurred by it in connection with its services under this
agreement. The Sub-Adviser shall not be responsible for any expenses incurred by
the Trust, the Sub-Advised Funds or the Adviser.
3.2 For the quarter and year in which this agreement becomes effective
or terminates there shall be a proration on the basis of the number of days that
the agreement is in effect during the quarter and year respectively.
3.3 If, pursuant to the Trust's Registration Statement and Declaration
of Trust then currently in effect, the net asset value is not required to be
determined on any particular business day, then for the purpose of the foregoing
computations, the net asset value of a share as last determined shall be deemed
to be the net asset value of a share as of the close of business on that day.
3.4 In connection with purchases or sales of portfolio securities for
the account of the Sub-Advised Funds, neither the Sub-Adviser nor any officer,
director, shareholder or other affiliate of the Sub-Adviser shall: (i) act as
agent and accept any compensation other than its compensation provided for in
this agreement, except in the course of such person's business as an underwriter
or broker; or (ii) act as broker and accept any commission, fee, or other
remuneration in excess of the limits prescribed in the 1940 Act and the rules
promulgated thereunder.
ARTICLE 4
Limitations of Liability; Indemnification
4.1 Limitation of Liability of Sub-Adviser. The Sub-Adviser shall not
be liable for any error of judgment or import of law, or for any loss suffered
by the Trust, any Sub-Advised Fund or their shareholders in connection with the
matters to which this agreement relates, except loss resulting from: (i) willful
misfeasance, bad faith or gross negligence on the part of the Sub-Adviser in the
performance of its obligations and duties under this agreement; or (ii) its
reckless disregard of its obligations and duties under this agreement. The
Sub-Adviser shall not have breached its obligations under this agreement by, nor
shall it be liable for, any action taken in good faith and in the exercise of
due care.
4.2 Limitation of Liability of Trust. The Sub-Adviser acknowledges
that it has received notice of and accepts the limitations on the Trust's
liability as set forth in the Trust's Declaration of Trust, as amended from
7
time to time. In accordance therewith, the Sub-Adviser agrees that the Trust's
obligations hereunder shall be limited to the assets of the Sub-Advised Funds
and, with respect to each Sub-Advised Fund, shall be limited to the assets of
such Sub-Advised Fund, and no party shall seek satisfaction of any such
obligation from any shareholder of the Trust, nor from any trustee, officer, or
employee of the Trust.
4.3 Indemnification.
(a) By the Sub-Adviser.
The Sub-Adviser shall indemnify and hold harmless the Adviser or the Trust from
any and all losses, claims, damages, or liabilities including reasonable
attorney's fees and related costs and expenses (collectively, "Claims"), to the
extent resulting, in whole or in part, from any acts, or failure to act, of the
Sub-Adviser, its affiliated companies, and their respective directors, officers,
and employees (collectively the "Sub-Adviser Parties"), that constitute willful
misconduct, bad faith, gross negligence, or reckless disregard of the
Sub-Adviser's obligations and duties hereunder.
(b) By the Adviser.
Because the Adviser has been retained solely to provide the investment advisory
and related services described in this agreement, the Adviser shall indemnify
and hold harmless the Sub-Adviser Parties against any and all Claims to which
any of the Sub-Adviser Parties may become subject in connection with the matters
to which this Agreement relates including, without limitation, claims under
federal or state securities laws, federal or state tax laws, or under any other
statute or regulation, at common law or otherwise, except to the extent that the
Sub-Adviser provides an indemnity under the previous paragraph, (S) 4.3(a).
ARTICLE 5
Books and Records
5.1 The Sub-Adviser hereby undertakes and agrees to maintain, in the
form and for the period required, all records relating to the Sub-Advised Funds'
investments that are required to be maintained by the Trust pursuant to the
requirements of Rule 31a-1 of the 1940 Act.
5.2 In compliance with Rule 31a-3 of the 1940 Act, the Sub-Adviser
agrees that all books and records which it maintains for the Sub-Advised Funds
are the property of the Trust and further agrees to surrender promptly to the
Trust any such books, records or information upon the Trust's request. All such
books and records shall be made available, within five business days of a
8
written request, to the Trust's accountants or auditors during regular business
hours at the Sub-Adviser's offices. The Trust or its authorized representative
shall have the right to copy any records in the possession of the Sub-Adviser,
which pertain to the Trust. Such books, records, information or reports shall be
made available to properly authorized government representatives consistent with
state and federal law and/or regulations. In the event of the termination of
this agreement, upon payment of any compensation due Sub-Adviser under Article 3
hereof, all such books, records or other information shall be returned to the
Trust upon the Trust's request.
5.3 The Sub-Adviser further agrees that it will not disclose or use
any records or information obtained pursuant to this agreement in any manner
whatsoever except as authorized in this agreement or as otherwise authorized by
the Trust or the Adviser and that it will keep confidential any information
obtained pursuant to this agreement and disclose such information only if the
Trust or the Adviser has authorized such disclosure, or if such disclosure is
required by federal or state regulatory authorities.
ARTICLE 6
Duration and Termination of this Agreement
6.1 Effective Date and Term. This agreement shall not become effective
unless and until the later of the time at which (i) it is approved by the
Trust's Board, including a majority of Trustees who are not parties to this
agreement or interested persons of any such party to this agreement, or (ii) it
is approved by such Sub-Advised Fund's outstanding voting securities as required
by the 1940 Act. This agreement shall come into full force and effect on the
date which it is so approved. As to each Sub-Advised Fund, the agreement shall
continue in effect for two years and shall thereafter continue in effect from
year to year so long as such continuance is specifically approved for each
Sub-Advised Fund at least annually by: (i) the Board, or by the vote of a
majority of such Sub-Advised Fund's outstanding voting securities; and (ii) 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.
6.2 Termination.
(a) This agreement may be terminated at any time, without
penalty, by vote of the Board, by vote of the holders of a majority of the
outstanding shares of the applicable Sub-Advised Fund, or by the Adviser or
Sub-Adviser, on sixty (60) days' written notice to the other parties.
(b) This agreement may be terminated at any time without the
payment of any penalty by the Adviser or by vote of the Board in the event that
it shall have been established by a court of competent jurisdiction that
9
the Sub-Adviser or any officer or director of the Sub-Adviser has taken any
action which results in a breach of the covenants of the Sub-Adviser set forth
herein.
(c) This agreement shall automatically terminate in the event of
its assignment.
ARTICLE 7
Amendments to this Agreement
7.1 This agreement may be amended as to each Sub-Advised Fund by the
parties only if such amendment is specifically approved by: (i) the vote of a
majority of such Sub-Advised Fund's outstanding voting securities; and (ii) 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 (unless, in the case of (i), the Trust receives an order
of the Commission or "no-action" letter permitting it to modify the agreement
without such vote).
ARTICLE 8
Notices
8.1 All notices and other communications hereunder shall be in writing
(including telex or similar writing) and shall be deemed given if delivered in
person or by messenger, cable, telegram or telex or facsimile transmission or by
a reputable overnight delivery service which provides evidence of receipt to the
parties at the following addresses or telex or facsimile transmission numbers
(or such other address or number for a party as shall be specified by like
notice):
(a) if to the Sub-Adviser, to:
Capital Guardian Trust Company
000 Xxxxx Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Facsimile transmission number: (000) 000-0000
Attention: Treasurer
(b) if to the Trust, to:
State Farm Mutual Fund Trust
Three Xxxxx Xxxx Xxxxx
Xxxxxxxxxxx Xxxxxxxx 00000
Facsimile transmission number: (000) 000-0000
Attention: Secretary
10
(c) if to the Adviser, to:
State Farm Investment Management Corp.
Three Xxxxx Xxxx Xxxxx
Xxxxxxxxxxx Xxxxxxxx 00000
Facsimile transmission number: (000) 000-0000
Attention: Secretary
Each such notice or other communication shall be effective (i) if given by telex
or facsimile transmission, when such telex or facsimile is transmitted to the
number specified in this section and the appropriate answer back or confirmation
is received, and (ii) if given by any other means, when delivered at the address
specified in this section.
ARTICLE 9
Representations and Warranties
9.1 Of the Sub-Adviser. By entering into this agreement, the
Sub-Adviser represents and warrants that:
(a) it is an investment adviser under the Advisers Act;
(b) it has full power and authority to enter into this agreement,
and that the undersigned has full power and authority to execute this Agreement
on the Sub-Advisor's behalf;
9.2 Of the Adviser. By entering into this agreement, the Adviser
represents and warrants that:
(a) it is a Delaware corporation;
(b) it has full power and authority to serve in its capacity as
Adviser to Trust and to enter into this agreement, and that the undersigned has
full power and authority to execute the Agreement on the Adviser's behalf.
(c) all securities, funds and other assets which at any time
constitute an Account are the sole property of the Trust and are free from any
charge or encumbrance;
(d) it has obtained all necessary licenses, permits, approvals or
other registrations to act as the Adviser of the Trust (and will promptly notify
the Sub-Adviser if any such licenses, permits, approvals or other registrations
are suspended, revoked or not renewed);
11
(e) it shall not transact in or remove from an Account any
securities, funds or other assets without first giving reasonable written notice
to the Sub-Adviser or terminating this Agreement; and
(f) it has received a copy of Part II of the Sub-Advisor's Form
ADV (the "ADV"). The Advisor understands that if it has received the ADV less
than 48 hours prior to its entering into this Agreement, the Advisor may
terminate the Agreement without penalty within five (5) business days after
entering into the Agreement.
9.3 Of the Trust.
(a) it is a Delaware business trust;
(b) it has full power and authority to enter into this agreement,
and that the undersigned has full power and authority to execute the agreement
on the Trust's behalf;
(c) all securities, funds and other assets which at any time
constitute an Account are the sole property of the Trust and are free from any
charge or encumbrance;
(d) it has obtained all necessary licenses, permits, approvals or
other registrations to act as a Trust (and will promptly notify the Sub-Adviser
if any such licenses, permits, approvals or other registrations are suspended,
revoked or not renewed); and
(e) it shall not transact in or remove from an Account any
securities, funds or other assets without first giving reasonable written notice
to the Sub-Adviser or terminating this Agreement.
ARTICLE 10
Use of Name
The Adviser and the Trust acknowledge and agree that the names "Capital Guardian
Trust Company," "Capital Guardian," and any of the other names of the
Sub-Adviser or the Sub-Adviser's affiliates (including the American Funds
Group), and any derivative or logo or trade or service xxxx thereof
(collectively, the "Names and Trademarks"), are the valuable property of the
Sub-Adviser and the Sub-Adviser's affiliates. The Adviser and the Trust shall
not have the right to use the Names and Trademarks without the prior, express,
written consent of the Sub-Adviser, which consent shall not be unreasonably
withheld for the period of time of which this Agreement is in effect; provided,
however, that such names may be used in the Registration Statement then
currently in effect without such
12
approval. Immediately, upon termination of this Agreement, the Adviser and the
Trust shall cease to use such Names and Trademarks.
The Adviser and the Trust agree that they will review with the Sub-Adviser any
advertisement, sales literature, presentation material or other notice prior to
its use or publication that makes reference to the Names and/or Trademarks, so
that the Sub-Adviser may review the context in which the Names and/or Trademarks
are being referred to, it being agreed that the Sub-Adviser shall have no
responsibility to ensure the adequacy of the form or content of such materials
for the purposes of applicable laws or regulations, if any. If the Adviser or
the Trust makes any unauthorized use of, or reference to, the Names or the
Trademarks, the Adviser and the Trust acknowledges that the Sub-Adviser may
suffer irreparable harm for which monetary damages may not be completely
adequate, and therefore the Sub-Adviser may also seek injunctive relief.
ARTICLE 11
Miscellaneous Provisions
11.1 Definitions of Certain Terms. The terms "assignment", "affiliated
person" and "interested person", when used in this agreement, shall have the
respective meanings specified in the 1940 Act. The term "majority of the
Sub-Advised Fund's outstanding voting securities" means the lesser of: (a) 67%
or more of the votes attributable to such Shares of the Sub-Advised Fund present
at a meeting if the holders of more than 50% of such votes are present or
represented by proxy; or (b) more than 50% of the votes attributable to Shares
of the Sub-Advised Fund.
11.2 Applicable Law.
(a) This agreement shall be construed and the provisions hereof
interpreted under and in accordance with the laws of Illinois without regard to
its conflicts of laws rules.
(b) This agreement shall be subject to the provisions of the 1940
and the Advisers Acts, and the rules and regulations and rulings thereunder,
including such exemptions from those statutes, rules and regulations as the SEC
may grant and the terms hereof shall be interpreted and construed in accordance
therewith.
11.3 Severability. If any provision of this agreement shall be held or
made invalid by a court decision, statute, rule or otherwise, the remainder of
this agreement shall not be affected thereby.
11.4 "State Farm". The Sub-Adviser agrees that the name "State Farm,"
which comprises a component of the Trust's name, is a property
13
right of the parent of the Adviser. Except as is necessary in performing its
duties under this Agreement, Sub-Adviser shall not have the right to use the
name "State Farm" or any derivative name or logo or trade or service xxxx
thereof without the express, written consent of the Adviser. The Sub-Adviser
acknowledges that the use of the name "State Farm" by the Trust is governed by
the terms of the Advisory Agreement.
11.5 Captions. The captions in this agreement are included for
convenience of reference only and in no way define or delineate any of the
provisions hereof or otherwise affect their construction or effect.
11.6 Counterparts. This agreement may be executed simultaneously in
multiple counterparts, each of which taken together shall constitute one and the
same instrument.
11.7 Cooperation with Authorities. Each party hereto shall cooperate
with the other party and all appropriate governmental authorities (including
without limitation the SEC, the NASD, and state securities regulators) and shall
permit such authorities reasonable access to its books and records in connection
with any investigation or inquiry relating to this agreement or the transactions
contemplated hereby.
11.8 Force Majeure. The Sub-Adviser shall not be liable for any
failure, delay or interruption in the performance of its obligations hereunder
if such failure, delay or interruption results from the occurrence of any acts,
events or circumstances beyond the Sub-Adviser's reasonable control, and the
Sub-Adviser shall have no responsibility of any kind for any loss or damage
thereby incurred or suffered by the Adviser. In such case, the terms of the
Agreement shall continue in full force and effect and the Sub-Adviser's
obligations shall be performed or carried out as soon as legally and practicably
possible after the cessation of such acts, events or circumstances.
11.9 Privacy. No entity a party to this agreement shall disclose or
use nonpublic personal information (as defined in Rule 3(t) of Regulation S-P)
provided by any other party to this agreement, except as necessary to carry out
the purposes for which such information is provided, including information that
is used in accordance with Rules 14 and 15 of Regulation S-P in the ordinary
course of business.
14
IN WITNESS WHEREOF, the parties hereto have caused this agreement to
be executed in their names and on their behalf by their duly authorized officers
all on the day and year first above written.
STATE FARM INVESTMENT MANAGEMENT CORP.
By: /s/ Xxxxxx X. Xxxx, Xx.
--------------------------------------
Name: Xxxxxx X. Xxxx, Xx.
Title: President
STATE FARM MUTUAL FUND TRUST
By: /s/ Xxxxxxx X. Xxxxxxx
--------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Senior Vice President and Treasurer
CAPITAL GUARDIAN TRUST COMPANY
By: /s/ Xxx X. Xxxxxxxx
--------------------------------------
Name: Xxx X. Xxxxxxxx
Title: Vice President
15
FEE SCHEDULE
The fees payable by the Adviser to the Sub-Adviser shall be determined according
to the following schedule and shall be based upon the average daily net assets
as determined by the Adviser. The fee shall be accrued daily and paid quarterly
to the Sub-Adviser by the Adviser.
Equity Fund:
--------------------------------------------------------------------------------
On the first $25 million .................. 0.55% of average daily net assets
--------------------------------------------------------------------------------
$25 million to $50 million ................ 0.40% of average daily net assets
--------------------------------------------------------------------------------
Over $50 million .......................... 0.275% of average daily net assets
--------------------------------------------------------------------------------
Small Cap Equity Fund:
--------------------------------------------------------------------------------
On the first $25 million .................. 0.75% of average daily net assets
--------------------------------------------------------------------------------
$25 million to $50 million ................ 0.60% of average daily net assets
--------------------------------------------------------------------------------
$50 million to $100 million ............... 0.425% of average daily net assets
--------------------------------------------------------------------------------
Over $100 million ......................... 0.375% of average daily net assets
--------------------------------------------------------------------------------
International Equity Fund:
--------------------------------------------------------------------------------
On the first $25 million .................. 0.75% of average daily net assets
--------------------------------------------------------------------------------
$25 million to $50 million ................ 0.60% of average daily net assets
--------------------------------------------------------------------------------
$50 million to $250 million ............... 0.425% of average daily net assets
--------------------------------------------------------------------------------
Over $250 million ......................... 0.375% of average daily net assets
--------------------------------------------------------------------------------
For purposes of calculating the fees under the above schedules, other assets
managed by Sub-Adviser for companies associated with the Adviser are taken into
consideration according to Sub-Adviser fee aggregation and discount policies.
16
