SUB-ADVISORY AGREEMENT
SUB-ADVISORY AGREEMENT (the "Agreement") made as of this 15th day of
August, 2008 (the "Effective Date") by and between Horizon Advisers (an
unincorporated division of Xxxxxxx Bank) a publicly traded company with its
principal place of business at 0000 00xx Xxxxxx, 0xx Xxxxx, Xxxxxxxx, XX 00000
(the "Adviser"), and XXXXXXX Partners, LLC a limited liability company with its
principal place of business at 0000 Xxxxxxxxx Xxxxxx XX, Xxxxx 0000, Xxxxxxx, XX
00000 (the "Sub-Adviser").
W I T N E S S E T H
WHEREAS, pursuant to authority granted to the Adviser by the Board of
Trustees (the "Board") of THE ADVISORS' INNER CIRCLE FUND II (the "Trust") on
behalf of the series set forth on Schedule A to this agreement and pursuant to
the provisions of the Investment Advisory Agreement dated as of August 15, 2008
between the Adviser and the Funds (the "Management Agreement"), the Adviser has
selected the Sub-Adviser to act as sub-investment adviser of the Funds and to
provide certain related services, including any incidental services, functions
or responsibilities not specifically described in this Agreement, but that are
required for the proper performance of such described services, functions and
responsibilities, and as more fully set forth in this Agreement (collectively,
the "SERVICES"), and to perform such Services under the terms and conditions
hereinafter set forth;
NOW, THEREFORE, in consideration of the mutual covenants and benefits
set forth herein, the Adviser and the Sub-Adviser do hereby agree as follows:
1. THE SUB-ADVISER'S SERVICES.
(A) DISCRETIONARY INVESTMENT MANAGEMENT SERVICES. The
Sub-Adviser shall act as sub-investment adviser with respect to
the Funds. In such capacity, the Sub-Adviser shall, subject to the
supervision of the Adviser and the Board, regularly provide the
Fund with investment research, advice and supervision and shall
furnish continuously an investment program for such Fund assets as
may be allocated by the Adviser to the Sub-Adviser for purposes of
investing Fund assets consistent with the investment objectives
and policies of the Fund. The Sub-Adviser shall determine, from
time to time, what investments shall be purchased for the Fund and
what such securities shall be held or sold by the Fund, subject
always to the provisions of the Trust's Agreement and Declaration
of Trust, its by-laws and its registration statement on Form N-1A
(the "Registration Statement") under the Investment Company Act of
1940, as amended (the "1940 Act"), and under the Securities Act of
1933, as amended (the "1933 Act"), covering Fund shares, as filed
with the Securities and Exchange Commission (the "Commission"),
and to the investment objectives, policies and restrictions of the
Fund, as each of the same shall be from time to time in effect.
With respect to such obligations under this Section 1(a), the
Sub-Adviser shall exercise full discretion and act for the Fund in
the same manner and with the same force and effect as the Fund
itself might or could do in order to effect purchases, sales or
other transactions. Notwithstanding the foregoing, the Sub-Adviser
shall, upon written instructions from the Adviser, effect such
portfolio transactions for the Fund as the Adviser may from time
to time direct; provided however, that the Sub-Adviser shall not
be responsible for any such portfolio transactions to the extent
effected upon written instructions from the Adviser. No reference
in this Agreement to the Sub-Adviser having full discretionary
authority over the Fund's investments shall in any way limit the
right of the Adviser, in its sole discretion, to establish or
revise policies in connection with the management of the Fund's
assets or to otherwise exercise its right to control the overall
management of the Fund's assets.
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(B) COMPLIANCE. The Sub-Adviser agrees to comply with the
requirements of the 1940 Act, the Investment Advisers Act of 1940,
as amended (the "Advisers Act"), the 1933 Act, the Securities
Exchange Act of 1934, as amended (the "1934 Act"), the Commodity
Exchange Act and the respective rules and regulations thereunder,
as applicable, as well as with all other applicable federal and
state laws, rules, regulations and case law that relate to the
services and relationships described hereunder and to the conduct
of its business as a registered investment adviser. The
Sub-Adviser also agrees to comply with the objectives, policies
and restrictions set forth in the Registration Statement, as
amended or supplemented, of the Funds, and with any policies,
guidelines, instructions and procedures approved by the Board or
the Adviser and provided to the Sub-Adviser in writing. In
selecting each Fund's portfolio securities and performing the
Sub-Adviser's obligations hereunder, the Sub-Adviser shall cause
the Funds to comply with the diversification and source of income
requirements of Subchapter M of the Internal Revenue Code of 1986,
as amended (the "Code"), and shall be responsible for such
compliance, for qualification as a regulated investment company.
The Sub-Adviser has adopted and implemented, and will maintain,
written compliance policies and procedures that it believes are
reasonably designed to prevent violations by the Sub-Adviser and
its "supervised persons" (as defined in the Advisers Act) of the
Advisers Act and the rules thereunder, and that it reasonably
believes are adequate to ensure compliance with the other laws and
regulations referred to in this paragraph (b). The Sub-Adviser
will review, no less frequently than annually, the adequacy of its
policies and procedures and the effectiveness of their
implementation. The Sub-Adviser represents, warrants and covenants
that it has, and will continue to have, a designated Chief
Compliance Officer responsible for administering its policies and
procedures. No supervisory activity undertaken by the Adviser
shall limit the Sub-Adviser's full responsibility for any of the
foregoing.
(C) PROXY VOTING. Pursuant to Board authority, the Adviser has
the authority to determine how proxies, with respect to securities
that are held by the Funds, shall be voted, and the Adviser has
determined to delegate the authority and responsibility to vote
proxies for each Fund's securities to the Sub-Adviser, subject to
the applicable written policies of the Fund and the Trust, as
applicable. So long as proxy voting authority for the Funds has
been delegated to the Sub-Adviser, the Sub-Adviser shall provide
such assistance to the Adviser with respect to the voting of
proxies for the Funds as the Adviser may from time to time
reasonably request, and the Sub-Adviser shall promptly forward to
the Adviser any information or documents necessary for the Adviser
to exercise its proxy voting responsibilities. The Sub-Adviser has
adopted and implemented, and will maintain, written policies and
procedures that it believes are reasonably designed to ensure that
it votes each Fund's securities in the best interests of that
Fund, including procedures to address material conflicts that may
arise between the interests of the Sub-Adviser and those of the
Fund. The Sub-Adviser shall carry out such responsibility in
accordance with any written instructions that the Board or the
Adviser shall provide from time to time and shall provide such
reports and keep such records relating to proxy voting as the
Board may reasonably request or as may be necessary for the Funds
to comply with the 1940 Act and other applicable law. Any such
delegation of proxy voting responsibility to the Sub-Adviser may
be revoked or modified in writing by the Board or
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the Adviser at any time. The Sub-Adviser shall not be responsible
for advising or acting for the Adviser in legal proceedings,
including but not limited to class actions, settlements and
related proofs of claim, or bankruptcies, involving securities
purchased or held by the Fund. Should the Sub-Adviser receive
notices or related materials for the Fund involving securities
purchased by the Sub-Adviser for the Fund, the Sub-Adviser shall
use commercially reasonable efforts to transmit copies of such
notices to the Adviser's current custodian for the Fund. The
Sub-Adviser shall not incur any liability for any delay or failure
to timely provide such notices or related materials to the
Adviser's current custodian for the Fund.
(D) RECORDKEEPING. The Sub-Adviser shall not be responsible
for the provision of administrative, bookkeeping or accounting
services to the Funds, except as otherwise provided herein or as
may be necessary for the Sub-Adviser to supply to the Adviser, the
Funds or its Board the information required to be supplied under
this Agreement.
The Sub-Adviser shall maintain separate books and detailed records
of all matters pertaining to each Fund's assets advised by the
Sub-Adviser required by Rule 31a-1 under the 1940 Act (other than
those records being maintained by the Adviser, custodian or
transfer agent appointed by the Funds) relating to its
responsibilities provided hereunder with respect to the Funds, and
shall preserve such records for the periods and in a manner
prescribed therefore by Rule 31a-2 under the 1940 Act (the "Fund
Books and Records"). The Fund Books and Records shall be available
to the Adviser and the Board at any time upon request, shall be
delivered to the Funds upon the termination of this Agreement and
shall be available for telecopying without delay during any day
the Funds are open for business. The Sub-Adviser may retain copies
of the Fund Books and Records as required by applicable law.
(E) HOLDINGS INFORMATION AND PRICING. The Sub-Adviser shall
provide regular reports regarding each Fund's holdings, and shall,
on its own initiative, furnish each Fund and the Adviser from time
to time with whatever information the Sub-Adviser believes is
appropriate for this purpose in consideration of the Services
contemplated hereunder. Notwithstanding the foregoing, the
Sub-Adviser agrees to immediately notify the Adviser if the
Sub-Adviser reasonably believes that the value of any security
held by a Fund may not reflect fair value, and the Sub-Adviser
agrees to provide any pricing information of which the Sub-Adviser
is aware to the Adviser and/or any Fund pricing agent to assist in
the determination of the fair value of any Fund holdings for which
market quotations are not readily available or as otherwise
required in accordance with the 1940 Act or the Funds valuation
procedures for the purpose of calculating the Fund's net asset
value in accordance with procedures and methods established by the
Board.
(F) COOPERATION WITH AGENTS OF THE ADVISER AND THE FUNDS. The
Sub-Adviser agrees to cooperate with, and provide reasonable
assistance to, the Adviser and the Funds, as well as the Funds'
custodian and foreign sub-custodians, the Funds' pricing agents
and all other agents and representatives of the Funds and the
Adviser, provide such information with respect to the Funds as
such entities may reasonably request from time to time in the
performance of their obligations, provide prompt responses to
reasonable requests made by such persons, and establish
appropriate interfaces with each of the foregoing so as to promote
the efficient exchange of information and compliance with all
applicable laws and regulations.
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2. CODE OF ETHICS. The Sub-Adviser has adopted a written code of
ethics that it reasonably believes complies with the requirements of Rule 17j-1
under the 1940 Act, which it will provide to the Adviser and the Funds. The
Sub-Adviser shall ensure that its Access Persons (as defined in the
Sub-Adviser's Code of Ethics) comply in all material respects with the
Sub-Adviser's Code of Ethics, as in effect from time to time. On or before the
Effective Date and thereafter upon request, the Sub-Adviser shall provide the
Funds with (i) a copy of the Sub-Adviser's current Code of Ethics, as in effect
from time to time, and (ii) a certification that it has adopted procedures
reasonably necessary to prevent Access Persons from engaging in any conduct
prohibited by the Sub-Adviser's Code of Ethics. Annually, the Sub-Adviser shall
furnish a written report, which complies with the requirements of Rule 17j-1,
concerning the Sub-Adviser's Code of Ethics to the Funds and the Adviser. The
Sub-Adviser shall respond to requests for information from the Adviser as to
violations of the Code by Access Persons and the sanctions imposed by the
Sub-Adviser. The Sub-Adviser shall immediately notify the Adviser of any
material violation of the Code, whether or not such violation relates to a
security held by any Fund.
3. INFORMATION AND REPORTING. The Sub-Adviser shall provide the
Funds, the Adviser, and their respective officers with such periodic reports
concerning the obligations the Sub-Adviser has assumed under this Agreement as
the Funds and the Adviser may from time to time reasonably request.
(A) NOTIFICATION OF BREACH / COMPLIANCE REPORTS. The
Sub-Adviser shall notify the Trust's Chief Compliance Officer and
Adviser immediately upon detection of (i) any failure to manage
any Fund in accordance with its written investment objectives and
policies or any applicable law; or (ii) any breach of any of the
Funds' or the Adviser's written policies, guidelines or
procedures. In addition, the Sub-Adviser shall provide a quarterly
report regarding each Fund's compliance with its written
investment objectives and policies and applicable law, including,
but not limited to the 1940 Act and Subchapter M of the Code, and
the Funds' and the Adviser's written policies, guidelines or
procedures as applicable to the Sub-Adviser's obligations under
this Agreement. The Sub-Adviser acknowledges and agrees that the
Adviser may, in its discretion, provide such quarterly compliance
certifications to the Board. The Sub-Adviser agrees to correct any
such failure promptly and to take any action that the Board and/or
the Adviser may reasonably request in connection with any such
breach. The Sub-Adviser shall also provide the officers of the
Trust with supporting documentation in connection with such
certifications of Fund financial statements and disclosure
controls pursuant to the Xxxxxxxx-Xxxxx Act. The Sub-Adviser will
promptly notify the Trust in the event (i) the Sub-Adviser is
served or otherwise receives notice of any action, suit,
proceeding, inquiry or investigation, at law or in equity, before
or by any court, public board, or body, involving the affairs of
the Trust (excluding class action suits in which a Fund is a
member of the plaintiff class by reason of the Fund's ownership of
shares in the defendant) or the compliance by the Sub-Adviser with
the federal or state securities laws or (ii) the controlling
stockholder of the Sub-Adviser changes or an actual change in
control resulting in an "assignment" (as defined in the 1940 Act)
has occurred or is otherwise proposed to occur.
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(B) INSPECTION. Upon reasonable request, the Sub-Adviser
agrees to make its records and premises available (including its
employees for interviews) to the extent that they relate to the
conduct of Services provided to the Funds or the Sub-Adviser's
conduct of its business as an investment adviser reasonably
available for compliance audits by the Adviser or a Fund's
employees, accountants or counsel; in this regard, the Funds and
the Adviser acknowledge that the Sub-Adviser shall have no
obligations to make available proprietary information unrelated to
the Services provided to the Funds, or any information related to
other clients of the Sub-Adviser.
(C) BOARD AND FILINGS INFORMATION. The Sub-Adviser will also
provide the Adviser with any information reasonably requested
regarding its management of the Funds required for any meeting of
the Board, or for any shareholder report, amended registration
statement, proxy statement, or prospectus supplement to be filed
by the Funds with the Commission. The Sub-Adviser will make its
officers and employees available to meet with the Board from time
to time on due notice to review its investment management services
to the Funds in light of current and prospective economic and
market conditions, and shall furnish to the Board such information
as may reasonably be necessary in order for the Board to evaluate
this Agreement or any proposed amendments thereto.
(D) TRANSACTION INFORMATION. The Sub-Adviser shall furnish to
the Adviser such information concerning portfolio transactions as
may be necessary to enable the Adviser to perform such compliance
testing on the Funds and the Sub-Adviser's Services as the Adviser
may reasonably determine to be appropriate. The provision of such
information by the Sub-Adviser in no way relieves the Sub-Adviser
of its own responsibilities under this Agreement.
4. BROKERAGE.
(A) PRINCIPAL TRANSACTIONS. In connection with purchases or
sales of securities for the account of a Fund, neither the
Sub-Adviser nor any of its directors, officers or employees will
act as a principal or agent or receive any commission except as
permitted by the 1940 Act.
(B) PLACEMENT OF ORDERS. The Sub-Adviser shall arrange for the
placing of all orders for the purchase and sale of securities for
a Fund's account with brokers or dealers selected by the
Sub-Adviser. In the selection of such brokers or dealers and the
placing of such orders, the Sub-Adviser is directed at all times
to seek, on behalf of a Fund, the most favorable execution and net
price available under the circumstances. It is also understood
that it is desirable for the Funds that the Sub-Adviser have
access to brokerage and research services provided by brokers who
may execute brokerage transactions at a higher cost to the Funds
than may result when allocating brokerage to other brokers,
consistent with section 28(e) of the 1934 Act and any Commission
staff interpretations thereof. Therefore, the Sub-Adviser is
authorized to place orders for the purchase and sale of securities
for the Funds with such brokers, subject to review by the Adviser
and the Board 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 its or its affiliates' services to other clients.
The Sub-Adviser shall not be responsible for any loss incurred by
reason of any act or omission of any broker or dealer; provided,
however, that the Sub-Adviser will make reasonable efforts to
require that brokers and dealers selected by the Sub-Adviser
perform their obligations with respect to the Fund.
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(C) AGGREGATED TRANSACTIONS. On occasions when the Sub-Adviser
deems the purchase or sale of a security to be in the best
interest of a Fund as well as other clients of the Sub-Adviser,
the Sub-Adviser may, to the extent permitted by applicable law and
regulations, aggregate the order for securities to be sold or
purchased. In such event, the Sub-Adviser will allocate securities
or futures contracts so purchased or sold, as well as the expenses
incurred in the transaction, in the manner the Sub-Adviser
reasonably considers to be equitable and consistent with its
fiduciary obligations to a Fund and to such other clients under
the circumstances.
(D) AFFILIATED BROKERS. The Sub-Adviser or any of its
affiliates may act as broker in connection with the purchase or
sale of securities or other investments for a Fund, subject to:
(a) the requirement that the Sub-Adviser seek to obtain best
execution and price within the policy guidelines determined by the
Board and set forth in a Fund's current prospectus and Statement
of Additional Information; (b) the provisions of the 1940 Act; (c)
the provisions of the 1934 Act; and (d) other provisions of
applicable law. Such brokerage services are not within the scope
of the duties of the Sub-Adviser under this Agreement. Subject to
the requirements of applicable law and any procedures adopted by
the Board, the Sub-Adviser or its affiliates may receive brokerage
commissions, fees or other remuneration from a Fund for such
services, in addition to the Sub-Adviser's fees for Services under
this Agreement, but not as fees for Services under this Agreement.
5. CUSTODY. Nothing in this Agreement shall permit the Sub-Adviser to
take or receive physical possession of cash, securities or other investments of
a Fund. The Sub-Adviser shall not be responsible for any loss incurred by reason
of any act or omission of any custodian, including but not limited to any loss
arising from, on account of or in connection with any custodian failing to
timely notify the Sub-Adviser of any corporate action or similar transaction.
6. ALLOCATION OF CHARGES AND EXPENSES. The Sub-Adviser will bear its
own costs of providing Services hereunder. Other than as herein specifically
indicated, the Sub-Adviser shall not be responsible for a Fund's or the
Adviser's expenses, including brokerage and other expenses incurred in placing
orders for the purchase and sale of securities and other investment instruments.
7. REPRESENTATIONS, WARRANTIES AND COVENANTS.
(A) PROPERLY REGISTERED. The Sub-Adviser is registered as an
investment adviser under the Advisers Act, and will remain so
registered for the duration of this Agreement. The Sub-Adviser is
not prohibited by the Advisers Act or the 1940 Act from performing
the Services contemplated by this Agreement, and to the best
knowledge of the Sub-Adviser, there is no proceeding or
investigation that is reasonably likely to result in the
Sub-Adviser being prohibited from performing the Services
contemplated by this Agreement. The Sub-Adviser agrees to promptly
notify the Trust of the occurrence of any event that would
disqualify the Sub-Adviser from serving as an investment adviser
to an investment company. The Sub-Adviser represents, warrants and
covenants that it is, and will continue to be, in compliance in
all material respects with all applicable federal and state law in
connection with its investment management operations.
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(B) ADV DISCLOSURE. The Sub-Adviser has provided the Trust
with a copy of Part I of its Form ADV as most recently filed with
the Commission and Part II as most recently updated and will,
promptly after filing any amendment to its Form ADV with the
Commission or updating its Part II, furnish a copy of such
amendments and updates to the Trust. The Sub-Adviser represents,
warrants and covenants that the information contained in the
Adviser's Form ADV is accurate and complete in all material
respects and is not misleading.
(C) FUND DISCLOSURE DOCUMENTS. The Sub-Adviser represents,
warrants and covenants that it has reviewed, and will in the
future review, the Registration Statement, and any amendments or
supplements thereto, the annual or semi-annual reports to
shareholders, other reports filed with the Commission and any
marketing material of a Fund (collectively the "Disclosure
Documents") provided the Sub-Adviser is provided the Disclosure
Documents and is requested to review them and represents, warrants
and covenants that with respect to disclosure about the
Sub-Adviser, the manner in which the Sub-Adviser manages the Fund
or information relating directly or indirectly to the Sub-Adviser,
such Disclosure Documents contain or will contain, as of the date
thereof, no untrue statement of any material fact and does not
omit any statement of material fact which was required to be
stated therein or necessary to make the statements contained
therein not misleading.
(D) INSURANCE. The Sub-Adviser maintains errors and omissions
insurance coverage in an amount that it believes is appropriate in
consideration of the Services provided hereunder, and shall
provide prior written notice to the Trust (i) of any material
changes in its insurance policies or insurance coverage; or (ii)
if any material claims will be made on its insurance policies.
Furthermore, the Sub-Adviser shall, upon reasonable request,
provide the Trust with any information it may reasonably require
concerning the amount or scope of such insurance.
(E) NO DETRIMENTAL AGREEMENT. The Sub-Adviser represents,
warrants and covenants that it does not, and shall not, have any
arrangement or understanding with any party, other than the Trust,
that would influence the decision of the Sub-Adviser with respect
to its selection of securities for a Fund, and that all selections
shall be done in accordance with what the Sub-Adviser believes is
in the best interest of the Fund and applicable law.
(F) CONFLICTS. The Sub-Adviser represents, warrants and
covenants that it shall act honestly, in good faith and in the
best interests of the Trust including requiring any of its
personnel with knowledge of Fund activities to place the interest
of the Fund first, ahead of their own interests, in all personal
trading scenarios that may involve a conflict of interest with the
Funds, consistent with its fiduciary duties under applicable law.
(G) REPRESENTATIONS. The representations, warranties and
covenants in this SECTION 7 shall be deemed to be made as of the
Effective Date and at the time of each delivery of the quarterly
compliance reports required by Section 3(a), as specifically
referenced in such report.
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8. SUB-ADVISER'S COMPENSATION. The Adviser shall pay to the
Sub-Adviser, as compensation for the Sub-Adviser's services hereunder, a fee,
determined as described in Schedule A that is attached hereto and made a part
hereof. Such fee shall be computed daily and paid monthly in arrears by the
Adviser. Neither the Fund(s) nor the Trust shall have any responsibility for any
fee payable to the Sub-Adviser.
The Sub-Adviser will be compensated based on the portion of Fund assets
allocated to the Sub-Adviser by the Adviser. In the event of termination of this
Agreement, the fee provided in this SECTION 8 shall be computed on the basis of
the period ending on the last business day on which this Agreement is in effect,
subject to a pro rata adjustment based on the number of days elapsed in such
month as a percentage of the total number of days in such month.
9. INDEPENDENT CONTRACTOR. In the performance of its duties
hereunder, the Sub-Adviser is and shall be an independent contractor and, unless
otherwise expressly provided herein or otherwise authorized in writing, shall
have no authority to act for or represent the Funds or the Adviser in any way or
otherwise be deemed to be an agent of the Funds or the Adviser. If any occasion
should arise in which the Sub-Adviser gives any advice to its clients concerning
the shares of a Fund, the Sub-Adviser will act solely as investment counsel for
such clients and not in any way on behalf of the Funds.
10 . ASSIGNMENT AND AMENDMENTS. This Agreement shall automatically
terminate, without the payment of any penalty, (i) in the event of its
assignment (as defined in section 2(a)(4) of the 0000 Xxx) or (ii) in the event
of the termination of the Management Agreement; provided that such termination
shall not relieve the Adviser or the Sub-Adviser of any liability incurred
hereunder prior to the termination date.
This Agreement may not be added to or changed orally and may not be modified or
rescinded except by a writing signed by the parties hereto and in accordance
with the 1940 Act, when applicable.
11. DURATION AND TERMINATION.
(A) This Agreement shall become effective as of the date
executed and shall remain in full force and effect continually
thereafter, subject to renewal as provided in Section 11(iii) and
unless terminated automatically as set forth in Section 10 hereof
or until terminated as follows:
(I) The Adviser may at any time terminate this Agreement
by not more than sixty (60) days' nor less than thirty (30) days'
written notice delivered or mailed by registered mail, postage
prepaid, to the Sub-Adviser. In addition, the Funds may cause this
Agreement to terminate either (i) by vote of its Board or (ii)
upon the affirmative vote of a majority of the outstanding voting
securities of the Funds; or
(II) The Sub-Adviser may at any time terminate this
Agreement by not more than sixty (60) days' nor less than thirty
(30) days' written notice delivered or mailed by registered mail,
postage prepaid, to the Adviser; or
(III) This Agreement shall automatically terminate two
years from the date of its execution unless its renewal is
specifically approved at least annually thereafter by (i) a
majority vote of the Trustees, including a majority vote of such
Trustees who are not interested persons of the Funds, the Adviser
or the Sub-Adviser, at a meeting called for the purpose of voting
on such approval; or (ii) the vote of a majority of the
outstanding voting securities of each Fund; provided, however,
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that if the continuance of this Agreement is submitted to the
shareholders of the Funds 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 as to the
Funds in a manner consistent with the 1940 Act and the rules and
regulations thereunder; and
(B) Termination of this Agreement pursuant to this Section
shall be without payment of any penalty.
In the event of termination of this Agreement for any reason, the
Sub-Adviser shall, immediately upon notice of termination or on
such later date as may be specified in such notice, cease all
activity on behalf of the Funds and with respect to any Fund
assets, except as expressly directed by the Adviser or as
otherwise required by any fiduciary duties of the Sub-Adviser
under applicable law. In addition, the Sub-Adviser shall deliver
each Fund's Books and Records to the Adviser by such means and in
accordance with such schedule as the Adviser shall direct and
shall otherwise cooperate, as reasonably directed by the Adviser,
in the transition of portfolio asset management to any successor
of the Sub-Adviser, including the Adviser. The Sub-Adviser may
retain copies of the Fund Books and Records as required by
applicable law.
12. CERTAIN DEFINITIONS. For the purposes of this Agreement:
(A) "Affirmative vote of a majority of the outstanding voting
securities of the Fund" shall have the meaning as set forth in the
1940 Act, subject, however, to such exemptions as may be granted
by the Commission under the 1940 Act or any interpretations of the
Commission staff.
(B) "Interested persons" and "Assignment" shall have their
respective meanings as set forth in the 1940 Act, subject,
however, to such exemptions as may be granted by the Commission
under the 1940 Act or any interpretations of the Commission staff.
13. LIABILITY OF THE SUB-ADVISER. The Sub-Adviser shall indemnify and
hold harmless the Trust and all affiliated persons thereof (within the meaning
of Section 2(a)(3) of the 0000 Xxx) and all their respective controlling persons
(as described in Section 15 of the 1933 Act) (collectively, the "Sub-Adviser
Indemnitees") against any and all losses, claims, damages, liabilities or
litigation (including reasonable legal expenses) by reason of or arising out of:
(a) the Sub-Adviser being in violation of any applicable federal or state law,
rule or regulation or any investment policy or restriction set forth in the
Funds' Registration Statement or any written guidelines or instruction provided
in writing by the Board, (b) a Fund's failure to satisfy the diversification or
source of income requirements of Subchapter M of the Code, or (c) the
Sub-Adviser's willful misfeasance, bad faith or gross negligence in the
performance of its duties hereunder or its reckless disregard of its obligations
and duties under this Agreement.
14. LIABILITY OF THE ADVISER. The Adviser shall indemnify and hold
harmless the Sub-Adviser (the "Adviser Indemnitee") against any and all losses,
claims, damages, liabilities or litigation (including reasonable legal expenses)
by reason of or arising out of: (a) the Adviser being in violation of any
applicable federal or state law, rule or regulation or any investment policy or
restriction set forth in the Funds' Registration Statement or any written
guidelines or instruction provided in writing by the Board, (b) on account of
the Sub-Adviser taking any actions in accordance with any instructions
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communicated to the Sub-Adviser by the Adviser or the Board, or (c) the
Adviser's willful misfeasance, bad faith or gross negligence in the performance
of its duties to the Fund or its reckless disregard of its obligations and
duties to the Fund.
15. ENFORCEABILITY. Any term or provision of this Agreement which is
invalid or unenforceable in any jurisdiction shall, as to such jurisdiction be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms or provisions of this
Agreement or affecting the validity or enforceability of any of the terms or
provisions of this Agreement in any other jurisdiction.
16. LIMITATION OF LIABILITY. The parties to this Agreement acknowledge
and agree that all litigation arising hereunder, whether direct or indirect, and
of any and every nature whatsoever resulting in any liability on the part of any
Fund or the Trust shall be satisfied solely out of the assets of the affected
Fund and that no Trustee, officer or holder of shares of beneficial interest of
the Fund shall be personally liable for any of the foregoing liabilities. The
Trust's Certificate of Trust, as amended from time to time, is on file in the
Office of the Secretary of State of the Commonwealth of Massachusetts. Such
Certificate of Trust and the Trust's Agreement and Declaration of Trust describe
in detail the respective responsibilities and limitations on liability of the
Trustees, officers, and holders of shares of beneficial interest.
17. CHANGE IN THE ADVISER'S OWNERSHIP. The Sub-Adviser agrees that it
shall notify the Trust of any anticipated or otherwise reasonably foreseeable
material change in the ownership of the Sub-Adviser within a reasonable time
prior to such change being effected.
18. NOTICES. All notices provided for or permitted under this
Agreement shall be deemed effective upon receipt, and shall be in writing and
(a) delivered personally, (b) sent by commercial overnight courier with written
verification of receipt, or (c) sent by certified or registered U.S. mail,
postage prepaid and return receipt requested, to the party to be notified, at
the address for such party set forth below, or at such other address of such
party specified in the opening paragraph of this Agreement. Notices to Adviser
shall be sent to the attention of: Xxxxx Xxxxxxxx. Notices to Sub-Adviser shall
be sent to the attention of: Xxxxx X. Xxxxxx, CCO.
19. JURISDICTION. This Agreement shall be governed by and construed in
accordance with the substantive laws of The Commonwealth of Massachusetts and
the Sub-Adviser consents to the jurisdiction of courts, both state and federal,
in Massachusetts, with respect to any dispute under this Agreement, without
giving effect to its principles governing conflicts of law.
20. PARAGRAPH HEADINGS. The headings of paragraphs contained in this
Agreement are provided for convenience only, form no part of this Agreement and
shall not affect its construction.
21. COUNTERPARTS. This Agreement may be executed simultaneously in two
or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
22. MISCELLANEOUS. The Adviser hereby acknowledges receipt of the
Sub-Adviser's Form ADV, Part II at least 48 hours prior to the effective date of
this Agreement pursuant to Rule 204-3 under the Investment Advisers Act of 1940.
10
IN WITNESS WHEREOF, the parties hereto have caused this
instrument to be signed on their behalf by their duly authorized
officers as of the date first above written.
ATTEST: HORIZON ADVISERS
/s/ ILLEGIBLE SIGNATURE By: /s/ XXXXX X.XXXXXXXX
----------------------- -----------------------
Name: Xxxxx X. Xxxxxxxx
Title: Senior Vice President
ATTEST: XXXXXXX PARTNERS, LLC
/s/ ILLEGIBLE SIGNATURE By: /s/ XXXXX X. XXXXX
----------------------- -------------------------------
Name: Xxxxx X. Xxxxxx
Title: CCO
Accepted and Agreed to as of the day and year first above written.
11
SCHEDULE A
TO THE
SUB-ADVISORY AGREEMENT
DATED AUGUST 15, 2008 BETWEEN
Horizon Advisers
AND
XXXXXXX Partners, LLC
The Adviser will pay to the Sub-Adviser as compensation for the Sub-Adviser's
services rendered, a fee, payable monthly and computed daily at an annual rate
based on the average daily net assets of the respective Fund as may be allocated
by the Adviser to the Sub-Adviser from time to time under the following fee
schedule:
---------------------------------------------- --------------------------------
FUND RATE
---------------------------------------------- --------------------------------
XXXXXXX HORIZON DIVERSIFIED INTERNATIONAL FUND 0.50% on the first $100 million
of average daily net assets
----------------------------------------------
0.45% on the average daily
assets in excess of $100 million
--------------------------------
