SUBADVISORY AGREEMENT
AGREEMENT executed as of November 20, 1997 by and between
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ CAPITAL MANAGEMENT, INC. ("▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇") and TOCQUEVILLE
ASSET MANAGEMENT, L.P. ("Sub-Adviser").
WHEREAS, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ desires to retain the Sub-Adviser to
furnish investment advisory services to ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ in connection with the
underlying investment funds specified on Schedule A hereto (collectively, the
"Funds," and each, a "Fund"), each of which is an investment portfolio of The
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Trust (the "Trust"); and
WHEREAS, Sub-Adviser is willing to make available to ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ and to the Funds certain sub-investment advisory services;
NOW, THEREFORE, in consideration of the mutual covenants
herein contained, the parties hereto agree as follows:
1. Appointment. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ hereby appoints the
Sub-Adviser to provide certain sub-investment advisory services for the period
and on the terms set forth in this Agreement. The Sub-Adviser accepts such
appointment and agrees to furnish the services herein set forth for the
compensation herein provided.
2. Management. Subject always to the supervision of ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ and the Trust's Board of Trustees, the Sub-Adviser will furnish an
investment program in respect of, and make investment decisions for, the
portions of the portfolios of the Funds allocated to it by ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, and
place all orders for the purchase and sale of securities for such portions of
the portfolios of the Funds. In the performance of its duties, the Sub-Adviser
will comply with the provisions of the Trust's organizational documentation, and
the stated investment objective, policies and restrictions of the Funds, as
amended, will use its best efforts to safeguard and promote the welfare of the
Funds, and will comply with other policies which the Trust's Board of Trustees
or ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, as the case may be, may from time to time determine and
communicate to the Sub-Adviser. The Sub-Adviser and ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ shall each
make its officers and employees available to the other from time to time to
review investment policies for the Funds and to consult with each other
regarding the investment affairs of the Funds. The Sub-Adviser shall report to
the Trust's Board of Trustees and to ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ with respect to the
implementation of such program.
The Sub-Adviser further agrees that it:
(a) will use the same skill and care in providing such
services as it uses in providing services to other accounts
for which it has investment management responsibilities;
(b) will conform with all applicable rules and regulations
of the SEC and in addition will conduct its activities under
this Agreement in accordance with any applicable regulations
of any other governmental authority pertaining to the
investment advisory activities of the Sub- Adviser;
(c) will not make loans to any person to purchase or carry
units of beneficial interest in the Trust or make loans to
the Trust;
(d) will place orders pursuant to its investment
determinations for the Funds either directly with the issuer
or with any broker or dealer. The Sub-Adviser may select
affiliated persons of the Trust or the Sub-Adviser to the
extent permitted pursuant to the Trust's procedures for
securities transactions with affiliated brokers pursuant to
Section 17(e)(2) and Rule 17e-1 under the Investment Company
Act. In placing orders with brokers and dealers, the
Sub-Adviser will attempt to obtain best execution of orders,
which shall mean quality execution at favorable securities
prices. Consistent with this obligation, when the execution
and price offered by two or more brokers or dealers are
comparable, the Sub-Adviser may, in its discretion, purchase
and sell portfolio securities to and from brokers and
dealers who provide the Sub-Adviser with research, advice
and other services;
(e) will report regularly to the Trust and to ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ and will make appropriate persons available for the
purpose of reviewing with representatives of ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
on a regular basis the management of the Funds, including,
without limitation, review of the general investment
strategy of the Fund, interest rate considerations and
general conditions affecting the marketplace;
(f) will maintain books and records with respect to the
Funds' securities transactions as are required by applicable
laws and regulations to be maintained and will furnish the
Trust's Board of Trustees such periodic and special reports
as are required by applicable laws and regulations to be
furnished or as the Board may reasonably request;
(g) will treat confidentially and as proprietary information
of the Trust all records and other information relative to
the Trust, and will not use records and information for any
purpose other than performance of its responsibilities and
duties hereunder, except after prior notification to and
approval in writing by the Trust, which approval shall not
be unreasonably withheld and may not be withheld where the
Sub-Adviser may be exposed to civil or criminal contempt
proceedings for failure to comply, when
requested to divulge such information by duly constituted
authorities, or when so requested by the Trust;
(h) will receive the recommendations as to guidelines and
benchmarks of ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ with respect to the investment
and reinvestment of the assets of the Funds and perform its
duties hereunder in accordance therewith;
(i) in making investment recommendations for the Funds, the
Sub- Adviser's personnel will not inquire as to or take into
consideration whether the issuers of securities proposed for
purchase or sale for the Fund's accounts are clients of the
Sub-Adviser or of its affiliates. In dealing with such
clients, the Sub-Adviser and its affiliates will not inquire
as to or take into consideration whether securities of those
customers are held by the Trust; and
(j) will provide advice and recommendations with respect to
other aspects of the business and affairs of the Funds and
perform such other functions related to the provision of
investment management services as ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ may
reasonably request.
3. Books and Records. In compliance with Rule 3la-3 under the
1940 Act, the Sub-Adviser hereby agrees that all records which it maintains for
the Trust on behalf of ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ are the property of the Trust and further
agrees to surrender promptly to the Trust or to ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ any of such
records upon request. The Sub-Adviser further agrees to preserve for the periods
prescribed by Rule 3la-2 adopted under the 1940 Act all records required to be
maintained by Sub-Adviser on behalf of ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ under Rule 3la-1 under
the 1940 Act.
4. Expenses. 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 (including
brokerage commissions, if any) purchased for the Funds.
5. Compensation. For the services provided and the expenses
assumed pursuant to this Agreement, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ will pay the Sub-Adviser and
the Sub-Adviser will accept as full compensation therefor a fee computed daily
and paid monthly in arrears at the annual rate set forth on Schedule A, based on
each Fund's average daily net assets.
In the event that investment advisory fees charged to a Fund by
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ are waived, deferred or reduced, then sub-advisory fees payable
in accordance with this Paragraph 5 shall be proportionally waived, deferred or
reduced. Such fee reduction, if applicable, shall be applied on a monthly basis
at the time each payment of sub-advisory fees is due hereunder. If investment
advisory fees are deferred by ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ and recovered from the Fund at a
later date, then the sub-advisory fees deferred in conjunction with the deferral
of the investment advisory fees shall be proportionally recouped from ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ by the Sub-Adviser at such later date.
6. Services Not Exclusive. The investment management services
furnished by the Sub-Adviser hereunder are not to be deemed exclusive, and the
Sub-Adviser shall be free to furnish similar services to others so long as its
services under this Agreement are not impaired thereby.
7. Limitation of Liability. The Sub-Adviser and its officers,
directors and employees shall not be liable for any error of judgment or mistake
of law or for any loss suffered by ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ or by the Funds in connection
with the performance of this Agreement, except a loss resulting from a breach of
fiduciary duty with respect to the receipt of compensation for services, or a
loss from willful misfeasance, bad faith or gross negligence on the part of the
Sub-Adviser in the performance of its duties or from reckless disregard by it of
its obligations and duties under this Agreement.
8. Duration and Termination. This Agreement will become
effective as of the date first written above in accordance with the requirements
under the 1940 Act, and, unless sooner terminated as provided herein, shall
continue in effect for a one-year term.
Thereafter, if not terminated, this Agreement shall continue
in effect as to each Fund for successive one-year periods, provided that such
continuance is specifically approved at least annually (a) by the vote of a
majority of those members of the Trust's Board of Trustees who are not
interested persons of the Trust, the Sub-Adviser, or ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, cast in
person at a meeting called for the purpose of voting on such approval, and (b)
by the Trust's Board of Trustees or by the vote of a majority of the outstanding
voting securities of that Fund. Notwithstanding the foregoing, this Agreement
may be terminated as to any Fund at any time
on sixty days' written notice, without the payment of any penalty, by the Trust
(by vote of the Trust's Board of Trustees or by vote of a majority of the
outstanding voting securities of the relevant Fund), by ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, or by
the Sub-Adviser. This Agreement will immediately terminate in the event of its
assignment, or in the event of the termination of ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇'▇ investment
advisory agreement with the Funds. (As used in this Agreement, the terms
"majority of the outstanding voting securities," "interested persons" and
"assignment" shall have the meaning ascribed to such terms in the 1940 Act.)
9. Amendment of this Agreement. No provision of this Agreement
may be changed, waived, discharged or terminated orally, but only by an
instrument in writing signed by the party against which enforcement of the
change, waiver, discharge or termination is sought.
10. Miscellaneous. 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. 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. This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors and shall be
governed by the laws of the State of New York.
11. Limit of Liability. The terms "The ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Trust"
and "Trustees" (of the Trust) refer, respectively to the trust created and the
Trustees, as trustees but not individually or personally, acting from time to
time under the Trust's organizational documentation, to which reference is
hereby made. The obligations of "The ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Trust" entered into in the
name or on behalf thereof by any of the Trustees, representatives or agents are
made not individually, but in such capacities and are not binding upon any of
the Trustees, shareholders or representatives of the Trust personally, but bind
only the assets of the Funds, and all persons dealing with the Funds or other
series of the Trust must look solely to the assets of the Funds for the
enforcement of any claims against the Trust.
12. Counterparts. This Agreement may be executed in
counterparts, each of which shall constitute an original and both of which,
collectively, shall constitute one agreement.
IN WITNESS WHEREOF, the parties hereto have caused this
instrument to be executed by their officers designated below as of the day and
year first above written.
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ CAPITAL MANAGEMENT, INC.
By: /s/▇▇▇▇▇▇ ▇▇▇▇▇▇
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Title: Chairman
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TOCQUEVILLE ASSET MANAGEMENT, L.P.
By: /s/▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
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Title: President of the General Partner
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SCHEDULE A
Name of Series Annual Rate
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▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Value Plus Fund .50% of average daily net assets