Exhibit (d)(2)(iii)
CDC NVEST SHORT TERM CORPORATE INCOME FUND
SUB-ADVISORY AGREEMENT
(▇▇▇▇▇▇, ▇▇▇▇▇▇ & COMPANY, L.P.)
Sub-Advisory Agreement (this "Agreement") entered into as of 1st day of
October, 2001, by and among CDC Nvest Funds Trust II, a Massachusetts business
trust (the "Trust"), with respect to its CDC Nvest Short Term Corporate Income
Fund series (the "Series"), CDC IXIS Asset Management Advisers, L.P., a Delaware
limited partnership (the "Manager"), and ▇▇▇▇▇▇, ▇▇▇▇▇▇ & Company, L.P., a
Delaware limited partnership (the "Sub-Adviser").
WHEREAS, the Manager has entered into an Advisory Agreement dated October
30, 2000 (the "Advisory Agreement") with the Trust, relating to the provision of
portfolio management and administrative services to the Series;
WHEREAS, the Advisory Agreement provides that the Manager may delegate any
or all of its portfolio management responsibilities under the Advisory Agreement
to one or more sub-advisers;
WHEREAS, the Manager and the Trustees of the Trust desire to retain the
Sub-Adviser to render portfolio management services in the manner and on the
terms set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth in this Agreement, the Trust, the Manager and the Sub-Adviser agree as
follows:
1. SUB-ADVISORY SERVICES.
a. The Sub-Adviser shall, subject to the supervision of the Manager
and of any administrator appointed by the Manager (the "Administrator"),
manage the investment and reinvestment of the assets of the Series, and
have the authority on behalf of the Series to vote all proxies and exercise
all other rights of the Series as a security holder of companies in which
the Series from time to time invests. The Sub-Adviser shall manage the
Series in conformity with (1) the investment objective, policies and
restrictions of the Series set forth in the Trust's prospectus and
statement of additional information relating to the Series, (2) any
additional policies or guidelines established by the Manager or by the
Trust's trustees that have been furnished in writing to the Sub-Adviser and
(3) the provisions of the Internal Revenue Code (the "Code") applicable to
"regulated investment companies" (as defined in Section 851 of the Code),
all as from time to time in effect (collectively, the "Policies"), and with
all applicable provisions of law, including without limitation all
applicable provisions of the Investment Company Act of 1940 (the "1940
Act") and the rules and regulations thereunder. Subject to the foregoing,
the Sub-Adviser is authorized, in its discretion and without prior
consultation with the Manager, to buy, sell, lend and otherwise trade in
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any stocks, bonds and other securities and investment instruments on behalf
of the Series, without regard to the length of time the securities have
been held and the resulting rate of portfolio turnover or any tax
considerations; and the majority or the whole of the Series may be invested
in such proportions of stocks, bonds, other securities or investment
instruments, or cash, as the Sub-Adviser shall determine.
b. The Sub-Adviser shall furnish the Manager and the Administrator
monthly, quarterly and annual reports concerning portfolio transactions and
performance of the Series in such form as may be mutually agreed upon, and
agrees to review the Series and discuss the management of it. The
Sub-Adviser shall permit all books and records with respect to the Series
to be inspected and audited by the Manager and the Administrator at all
reasonable times during normal business hours, upon reasonable notice. The
Sub-Adviser shall also provide the Manager with such other information and
reports as may reasonably be requested by the Manager from time to time,
including without limitation all material requested by or required to be
delivered to the Trustees of the Trust.
c. The Sub-Adviser shall provide to the Manager a copy of the
Sub-Adviser's Form ADV as filed with the Securities and Exchange Commission
and a list of the persons whom the Sub-Adviser wishes to have authorized to
give written and/or oral instructions to custodians of assets of the
Series.
2. OBLIGATIONS OF THE MANAGER.
a. The Manager shall provide (or cause the Series' Custodian (as
defined in Section 3 hereof) to provide) timely information to the
Sub-Adviser regarding such matters as the composition of assets of the
Series, cash requirements and cash available for investment in the Series,
and all other information as may be reasonably necessary for the
Sub-Adviser to perform its responsibilities hereunder.
b. The Manager has furnished the Sub-Adviser a copy of the prospectus
and statement of additional information of the Series and agrees during the
continuance of this Agreement to furnish the Sub-Adviser copies of any
revisions or supplements thereto at, or, if practicable, before the time
the revisions or supplements become effective. The Manager agrees to
furnish the Sub-Adviser with minutes of meetings of the trustees of the
Trust applicable to the Series to the extent they may affect the duties of
the Sub-Adviser, and with copies of any financial statements or reports
made by the Series to its shareholders, and any further materials or
information which the Sub-Adviser may reasonably request to enable it to
perform its functions under this Agreement.
3. CUSTODIAN. The Manager shall provide the Sub-Adviser with a copy
of the Series' agreement with the custodian designated to hold the assets
of the Series (the "Custodian") and any modifications thereto (the "Custody
Agreement"), copies of such modifications to be provided to the Sub-Adviser
a reasonable time in advance of the effectiveness of such modifications.
The assets of the Series shall be maintained in the custody of the
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Custodian identified in, and in accordance with the terms and conditions
of, the Custody Agreement (or any sub-custodian properly appointed as
provided in the Custody Agreement). The Sub-Adviser shall have no liability
for the acts or omissions of the Custodian, unless such act or omission is
taken in reliance upon instruction given to the Custodian by a
representative of the Sub-Adviser properly authorized to give such
instruction under the Custody Agreement. Any assets added to the Series
shall be delivered directly to the Custodian.
4. PROPRIETARY RIGHTS. The Manager agrees and acknowledges that the
Sub-Adviser is the sole owner of the name "▇▇▇▇▇▇, ▇▇▇▇▇▇ & Company, L.P."
and that all use of any designation consisting in whole or part of "▇▇▇▇▇▇,
▇▇▇▇▇▇ & Company, L.P." under this Agreement shall inure to the benefit of
the Sub-Adviser. The Manager on its own behalf and on behalf of the Series
agrees not to use any such designation in any advertisement or sales
literature or other materials promoting the Series, except with the prior
written consent of the Sub-Adviser. Without the prior written consent of
the Sub-Adviser, the Manager shall not, and the Manager shall use its best
efforts to cause the Series not to, make representations regarding the
Sub-Adviser in any disclosure document, advertisement or sales literature
or other materials relating to the Series. Upon termination of this
Agreement for any reason, the Manager shall cease, and the Manager shall
use its best efforts to cause the Series to cease, all use of any such
designation as soon as reasonably practicable.
5. EXPENSES.Except for expenses specifically assumed or agreed to be
paid by the Sub-Adviser pursuant hereto, the Sub-Adviser shall not be
liable for any organizational, operational or business expenses of the
Manager or the Trust including, without limitation, (a) interest and taxes,
(b) brokerage commissions and other costs in connection with the purchase
or sale of securities or other investment instruments with respect to the
Series, and (c) custodian fees and expenses. Any reimbursement of advisory
fees required by any expense limitation provision of any law shall be the
sole responsibility of the Manager. The Manager and the Sub-Adviser shall
not be considered as partners or participants in a joint venture. The
Sub-Adviser will pay its own expenses incurred in furnishing the services
to be provided by it pursuant to this Agreement. Neither the Sub-Adviser
nor any affiliated person thereof shall be entitled to any compensation
from the Manager or the Trust with respect to service by any affiliated
person of the Sub-Adviser as an officer or trustee of the Trust (other than
the compensation to the Sub-Adviser payable by the Manager pursuant to
Section 7 hereof).
6. PURCHASE AND SALE OF ASSETS. The Sub-Adviser shall place all orders
for the purchase and sale of securities for the Series with brokers or
dealers selected by the Sub-Adviser, which may include brokers or dealers
affiliated with the Sub-Adviser, provided such orders comply with Rule
17e-1 under the 1940 Act in all respects. To the extent consistent with
applicable law, purchase or sell orders for the Series may be aggregated
with contemporaneous purchase or sell orders of other clients of the
Sub-Adviser. The Sub-Adviser shall use its best efforts to obtain execution
of transactions for the Series at prices which are advantageous to the
Series and at commission rates that are reasonable in relation to the
benefits received. However, the Sub-Adviser may select brokers or dealers
on the basis that they provide brokerage, research or other services or
products to the Series and/or other accounts serviced by the Sub-Adviser.
To the extent consistent with applicable law, the Sub-Adviser may pay a
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broker or dealer an amount of commission for effecting a securities
transaction in excess of the amount of commission or dealer spread another
broker or dealer would have charged for effecting that transaction if the
Sub-Adviser determines in good faith that such amount of commission was
reasonable in relation to the value of the brokerage and research products
and/or services provided by such broker or dealer. This determination, with
respect to brokerage and research services or products, may be viewed in
terms of either that particular transaction or the overall responsibilities
which the Sub-Adviser and its affiliates have with respect to the Series or
to accounts over which they exercise investment discretion. Not all such
services or products need be used by the Sub-Adviser in managing the
Series.
To the extent permitted by applicable law, and in all instances subject to
the foregoing policy of best execution, the Sub-Adviser may allocate brokerage
transactions in a manner that takes into account the sale of shares of one or
more funds distributed by CDC IXIS Asset Management Distributors, L.P. ("CDC
IXIS Distributors"). In addition, the Sub-Adviser may allocate brokerage
transactions to broker-dealers (including affiliates of CDC IXIS Distributors)
that have entered into arrangements in which the broker-dealer allocates a
portion of the commissions paid by a fund toward the reduction of that fund's
expenses, subject to the policy of best execution.
7. COMPENSATION OF THE SUB-ADVISER. As full compensation for all services
rendered, facilities furnished and expenses borne by the Sub-Adviser hereunder,
the Sub-Adviser shall be paid at the annual rate of 0.275% of the first $200
million of the average daily net assets of the Series, 0.255% of the next $300
million of the average daily net assets of the Series, and 0.235% of such assets
in excess of $500 million (or such lesser amount as the Sub-Adviser may from
time to time agree to receive). Such compensation shall be paid by the Trust
(except to the extent that the Trust, the Sub-Adviser and the Manager otherwise
agree in writing from time to time). Such compensation shall be payable monthly
in arrears or at such other intervals, not less frequently than quarterly, as
the Manager is paid by the Series pursuant to the Advisory Agreement.
8. NON-EXCLUSIVITY. The Manager and the Series agree that the services
of the Sub-Adviser are not to be deemed exclusive and that the Sub-Adviser and
its affiliates are free to act as investment manager and provide other services
to various investment companies and other managed accounts, except as the
Sub-Adviser and the Manager or the Administrator may otherwise agree from time
to time in writing before or after the date hereof. This Agreement shall not in
any way limit or restrict the Sub-Adviser or any of its directors, officers,
employees or agents from buying, selling or trading any securities or other
investment instruments for its or their own account or for the account of others
for whom it or they may be acting, provided that such activities do not
adversely affect or otherwise impair the performance by the Sub-Adviser of its
duties and obligations under this Agreement. The Manager and the Series
recognize and agree that the Sub-Adviser may provide advice to or take action
with respect to other clients, which advice or action, including the timing and
nature of such action, may differ from or be identical to advice given or action
taken with respect to the Series. The Sub-Adviser shall for all purposes hereof
be deemed to be an independent contractor and shall, unless otherwise provided
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or authorized, have no authority to act for or represent the Series or the
Manager in any way or otherwise be deemed an agent of the Series or the Manager.
9. LIABILITY.Except as may otherwise be provided by the 1940 Act or other
federal securities laws, neither the Sub-Adviser nor any of its officers,
directors, partners, employees or agents (the "Indemnified Parties") shall be
subject to any liability to the Manager, the Trust, the Series or any
shareholder of the Series for any error of judgment, any mistake of law or any
loss arising out of any investment or other act or omission in the course of,
connected with, or arising out of any service to be rendered under this
Agreement, except by reason of willful misfeasance, bad faith or gross
negligence in the performance of the Sub-Adviser's duties or by reason of
reckless disregard by the Sub-Adviser of its obligations and duties hereunder.
The Manager shall hold harmless and indemnify the Sub-Adviser for any loss,
liability, cost, damage or expense (including reasonable attorneys fees and
costs) arising from any claim or demand by any past or present shareholder of
the Series that is not based upon the obligations of the Sub-Adviser under this
Agreement.
The Manager acknowledges and agrees that the Sub-Adviser makes no
representation or warranty, expressed or implied, that any level of performance
or investment results will be achieved by the Series or that the Series will
perform comparably with any standard or index, including other clients of the
Sub-Adviser, whether public or private.
10. EFFECTIVE DATE AND TERMINATION. This Agreement shall become effective
as of the date of its execution, and
a. unless otherwise terminated, this Agreement shall continue in
effect for two years from the date of execution, and from year to year
thereafter so long as such continuance is specifically approved at least
annually (i) by the Board of Trustees of the Trust or by vote of a majority
of the outstanding voting securities of the Series, and (ii) by vote of a
majority of the trustees of the Trust who are not interested persons of the
Trust, the Manager or the Sub-Adviser, cast in person at a meeting called
for the purpose of voting on such approval;
b. this Agreement may at any time be terminated on sixty days'
written notice to the Sub-Adviser either by vote of the Board of Trustees
of the Trust or by vote of a majority of the outstanding voting securities
of the Series;
c. this Agreement shall automatically terminate in the event of its
assignment or upon the termination of the Advisory Agreement; and
d. this Agreement may be terminated by the Sub-Adviser on ninety days'
written notice to the Manager and the Trust, or by the Manager on ninety
days' written notice to the Sub-Adviser.
Termination of this Agreement pursuant to this Section 10 shall be without
the payment of any penalty.
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11. AMENDMENT. This Agreement may be amended at any time by mutual consent
of the Manager and the Sub-Adviser, provided that, if required by law, such
amendment shall also have been approved by vote of a majority of the outstanding
voting securities of the Series and by vote of a majority of the trustees of the
Trust who are not interested persons of the Trust, the Manager or the
Sub-Adviser, cast in person at a meeting called for the purpose of voting on
such approval.
12. CERTAIN DEFINITIONS. For the purpose of this Agreement, the terms "vote
of a majority of the outstanding voting securities," "interested person,"
"affiliated person" and "assignment" shall have their respective meanings
defined in the 1940 Act, subject, however, to such exemptions as may be granted
by the Securities and Exchange Commission under the 1940 Act.
13. GENERAL.
a. The Sub-Adviser may perform its services through any employee,
officer or agent of the Sub-Adviser, and the Manager shall not be entitled
to the advice, recommendation or judgment of any specific person; provided,
however, that the persons identified in the prospectus of the Series shall
perform the day-to-day portfolio management duties described therein until
the Sub-Adviser notifies the Manager that one or more other employees,
officers or agents of the Sub-Adviser, identified in such notice, shall
assume such duties as of a specific date.
b. If any term or provision of this Agreement or the application
thereof to any person or circumstances is held to be invalid or
unenforceable to any extent, the remainder of this Agreement or the
application of such provision to other persons or circumstances shall not
be affected thereby and shall be enforced to the fullest extent permitted
by law.
c. In accordance with Regulation S-P, if non-public personal
information regarding either party's customers or consumers is disclosed to
the other party in connection with this Agreement, the party receiving such
information will not disclose or use that information other than as
necessary to carry out the purposes of this Agreement.
d. This Agreement shall be governed by and interpreted in accordance
with the laws of The Commonwealth of Massachusetts.
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CDC IXIS Asset Management Advisers, L.P.
By CDC IXIS Asset Management Distribution Corporation, its general partner
By: /S/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: President
▇▇▇▇▇▇, ▇▇▇▇▇▇ & Company, L.P.
By ▇▇▇▇▇▇, ▇▇▇▇▇▇ & Company, Inc., its general partner
By: /S/ ▇▇▇▇▇ ▇. CHARLESTON
Name: ▇▇▇▇▇ ▇. Charleston
Title: Director
CDC NVEST FUNDS TRUST II,
on behalf of its CDC Nvest Short Term Corporate Income Fund series
By /S/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: President
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NOTICE
A copy of the Agreement and Declaration of Trust establishing CDC Nvest
Funds Trust II (the "Fund") is on file with the Secretary of The Commonwealth of
Massachusetts, and notice is hereby given that this Agreement is executed with
respect to the Fund's CDC Nvest Short Term Corporate Income Fund series (the
"Series") on behalf of the Fund by officers of the Fund as officers and not
individually and that the obligations of or arising out of this Agreement are
not binding upon any of the trustees, officers or shareholders individually but
are binding only upon the assets and property belonging to the Series.
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