For period ending July 31, 2016 Exhibit 77Q1
File number 811-8764
SUB-ADVISORY AGREEMENT
Agreement dated as of July 8, 2016 between UBS Asset
Management (Americas) Inc. ("UBS AM"), a Delaware
corporation, and PCJ Investment Counsel Ltd. ("Sub- Adviser"), a
Canada Corporation (the "Agreement").
RECITALS
(1) UBS AM has entered into a Management Agreement dated
as of August 1, 2008 ("Management Agreement"), with PACE(r)
Select Advisors Trust ("Trust"), an open-end management
investment company registered under the Investment Company
Act of 1940, as amended ("1940 Act"), with respect to PACE(r)
Alternative Strategies Investments ("Portfolio"); and
(2) UBS AM is authorized to retain one or more sub-advisers to
furnish certain investment advisory services to UBS AM and the
Portfolio;
(3) UBS AM desires to retain the Sub-Adviser to furnish certain
investment advisory services to UBS AM and the Portfolio or a
designated portion of the assets ("Segment") of the Portfolio; and
(4) The Sub-Adviser is willing to furnish such services;
Now therefore, in consideration of the premises and mutual
covenants herein contained, UBS AM and the Sub-Adviser agree
as follows:
1. Appointment. UBS AM hereby appoints the Sub-Adviser as
an investment sub-adviser with respect to the Portfolio or
Segment for the period and on the terms set forth in this
Agreement. The Sub-Adviser accepts that appointment and
agrees to render the services herein set forth, for the
compensation herein provided.
2. Duties as Sub-Adviser.
(a) Subject to the supervision and direction of the Trust's
Board of Trustees (the "Board") and review by UBS AM, and any
written guidelines adopted by the Board or UBS AM the Sub-
Adviser will provide a continuous investment program for the
Portfolio or Segment, including investment research and
discretionary management with respect to all securities and
investments and cash equivalents in the Portfolio or Segment.
The Sub-Adviser will determine from time to time what
investments will be purchased, retained or sold by the Portfolio
or Segment. The Sub-Adviser will be responsible for placing
purchase and sell orders for investments and for other related
transactions for the Portfolio or Segment. The Sub-Adviser
understands that the Portfolio's assets need to be managed so as
to permit the Portfolio to qualify or to continue to qualify as a
regulated investment company under Subchapter M of the
Internal Revenue Code, as amended ("Code"). The Sub-Adviser
will provide services under this Agreement in accordance with the
Portfolio's investment objective, policies and restrictions as
stated in the Trust's currently effective registration statement
under the 1940 Act, and any amendments or supplements
thereto ("Registration Statement"). The Sub-Adviser, on each
business day, shall provide UBS AM and the Trust's custodian
such information as UBS AM and the Trust's custodian may
reasonably request relating to all transactions concerning the
Portfolio or Segment.
UBS AM hereby designates and appoints the Sub-Adviser as its
and the Portfolio's limited purpose agent and attorney-in-fact,
without further prior approval of UBS AM (except as expressly
provided for herein or as may be required by law) to make and
execute, in the name and on behalf of the Portfolio, all
agreements, instruments and other documents and to take all
such other action which the Sub-Adviser considers necessary or
advisable to carry out its duties hereunder. By way of example
and not by way of limitation, in connection with any purchase for
the Portfolio or Segment of securities or instruments that are not
registered under the U.S. Securities Act of 1933, as amended (the
"Securities Act"), the Sub-Adviser shall have the full power and
authority, among other things, to: (i) commit to purchase such
securities for the Portfolio on the terms and conditions under
which such securities are offered; (ii) execute such account
opening and other agreements, instruments and documents
(including, without limitation, purchase agreements, subscription
documents, ISDA and other swap and derivative documents), and
make such commitments, as may be required in connection with
the purchase and sale of such securities or instruments; (iii)
represent that the Portfolio is an "accredited investor" as defined
in Rule 501 (a) of Regulation D under the Securities Act and a
"Qualified Institutional Buyer" as defined in Rule 144A (a) (1) (i)
under the Securities Act; and (iv) commit that such securities will
not be offered or sold by the Portfolio except in compliance with
the registration requirements of the Securities Act or an
exemption therefrom. This power-of-attorney is a continuing
power-of-attorney and shall remain in full force and effect until
revoked by UBS AM or the Trust in writing, but any such
revocation shall not affect any transaction initiated prior to
receipt by the Sub-Adviser of such notice.
When investing in non-US securities, the Sub-Adviser is
responsible for identifying and complying with all applicable laws
and regulations of the jurisdiction in which the security is traded.
The Sub-Adviser shall use the degree of care, diligence and skill
that a reasonably prudent investment manager would exercise
under the circumstances not to establish or add to existing
positions in securities that are subject to any applicable foreign
ownership limits or levels ("FOL'') at a time when it is reasonably
foreseeable that such purchases will have to be sold due to FOL
limits or levels.
(b) The Sub-Adviser agrees that it will not consult with any
other sub-adviser ("Other Sub-Adviser") for the Trust or Portfolio
concerning any transaction by the Portfolio or Segment in
securities or other assets, including (i) the purchase by the
Portfolio or Segment of a security issued by the Other Sub-
Adviser, or an affiliate of the Other Sub-Adviser, to the Trust or
Portfolio except as permitted by the 1940 Act or (ii) transactions
by the Portfolio or Segment in any security for which the Other
Sub-Adviser, or its affiliate, is the principal underwriter.
(c) Unless otherwise instructed by UBS AM or the Trust, the
Sub-Adviser agrees that it will be responsible for voting proxies of
issuers of securities held by the Portfolio or Segment. The Sub-
Adviser further agrees that it will adopt written proxy voting
procedures that shall comply with the requirements of the 1940
Act and the Investment Advisers Act of 1940, as amended
("Advisers Act") ("Proxy Voting Policy"), and that shall be
acceptable to the Board. The Sub-Adviser shall also provide its
Proxy Voting Policy, and if requested by UBS AM, a summary of
such Proxy Voting Policy for inclusion in the Trust's registration
statement, and will provide UBS AM with any material
amendment to the Proxy Voting Policy within a reasonable time
after such amendment has taken effect. The Sub-Adviser further
agrees that it will provide the Board on or before August 1st of
each year, or more frequently as the Board may reasonably
request, with a written report of the proxies voted during the
most recent 12-month period ending June 30, or such other
period as the Board may designate, in a format that shall comply
with the 1940 Act and that shall be acceptable to the Board.
(d) The Sub-Adviser agrees that upon the request of UBS AM
or the Board, Sub-Adviser shall exercise the rights incident to the
securities held by the Portfolio or Segment in the context of a
bankruptcy or other reorganization. The Sub-Adviser further
agrees that it will keep UBS AM fully informed about any such
actions that it intends to take.
(e) The Sub-Adviser agrees that it will place orders with
brokers in accordance with its best execution policies, taking into
account the best available price as an important factor in this
decision, provided that, on behalf of the Portfolio or Segment, the
Sub-Adviser may, in its discretion, use brokers that provide the
Sub-Adviser with research, analysis, advice and similar services to
execute portfolio transactions on behalf of the Portfolio or
Segment, and the Sub-Adviser may pay to those brokers in return
for brokerage and research services a higher commission than
may be charged by other brokers, subject to the Sub-Adviser's
determination in good faith that such commission is reasonable in
terms either of the particular transaction or of the overall
responsibility of the Sub-Adviser to the Portfolio or Segment and
its other clients and that the total commissions paid by the
Portfolio or Segment will be reasonable in relation to the benefits
to the Portfolio or Segment over the long term. In no instance
will portfolio securities knowingly be purchased from or sold to
UBS AM or the Sub-Adviser, the Trust's principal underwriter, or
any affiliated person thereof, except in accordance with the
federal securities laws and the rules and regulations thereunder.
The Sub-Adviser may aggregate sales and purchase orders with
respect to the assets of the Portfolio or Segment with similar
orders being made simultaneously for other accounts advised by
the Sub-Adviser or its affiliates. Whenever the Sub-Adviser
simultaneously places orders to purchase or sell the same
security on behalf of the Portfolio or Segment and one or more
other accounts advised by the Sub-Adviser, the orders will be
allocated as to price and amount among all such accounts in a
manner believed to be equitable over time to each account. UBS
AM recognizes that in some cases this procedure may adversely
affect the results obtained for the Portfolio or Segment.
Subject to the Sub-Adviser's obligations to seek best execution,
UBS AM agrees that the Sub-Adviser, in its sole discretion, may
place transactions on behalf of the Portfolio or Segment and the
Trust with any broker-dealer deemed to be an affiliate (including
affiliated FCMs) of the Sub-Adviser (the "Affiliated Broker-
Dealers") so long as such transactions are effected in conformity
with the requirements (including any applicable exemptions and
administrative interpretations set forth in Part 2A of the Sub-
Adviser's Form ADV Registration Statement on file with the
Securities and Exchange Commission ("Form ADV")) of Section
11(a)(1)(H) of the Securities Exchange Act of 1934 (the "1934
Act"), and in compliance with Rules 17e-1 or 10f-3 under the
1940 Act or other applicable rules and the Trust's policies and
procedures thereunder. In all such dealings, the Affiliated Broker-
Dealers shall be authorized and entitled to retain any
commissions, remuneration or profits which may be made in such
transactions and shall not be liable to account for the same to
UBS AM, the Portfolio or the Trust. In the event Sub-Adviser
becomes affiliated (as deemed under the federal securities laws)
with a broker-dealer during the term of this Agreement, Sub-
Adviser shall obtain the approval of the Trust's Board of Trustees
prior to commencement of transactions with such broker-dealer
on behalf of the Portfolio or the Trust.
UBS AM further authorizes the Sub-Adviser and its Affiliated
Broker-Dealers to execute agency cross transactions (the "Cross
Transactions") on behalf of the Portfolio and the Trust. Cross
Transactions are transactions which may be effected by the
Affiliated Broker-Dealers acting for both the Portfolio or the Trust
and the counterparty to the transaction. Cross Transactions
enable the Sub-Adviser to purchase or sell a block of securities for
the Portfolio or the Trust at a set price and possibly avoid an
unfavorable price movement that may be created through
entrance into the market with such purchase or sale order. As
such, the Sub-Adviser believes that Cross Transactions can
provide meaningful benefits for the Portfolio and the Trust and its
clients generally. UBS AM, the Portfolio and the Trust should be
aware, however, that in a Cross Transaction an Affiliated Broker-
Dealer will be receiving commissions from both sides of the trade
and, therefore, there is a potentially conflicting division of
loyalties and responsibilities. Sub-Adviser shall effect such Cross
Transactions in compliance with Rule 206(3)-2 under the Advisers
Act, Rule 17a-7 under the 1940 Act, and any other applicable
provisions of the federal securities laws and shall provide UBS AM
with periodic reports describing such agency cross transactions.
UBS AM understands that the authority of the Sub-Adviser to
execute agency Cross Transactions for the Portfolio is terminable
at will without penalty, effective upon receipt by the Sub-Adviser
of written notice from UBS AM, and that the failure to terminate
such authorization will result in its continuation.
(f) The Sub-Adviser shall maintain separate detailed records of
all matters pertaining to the Portfolio or Segment, including,
without limitation, brokerage and other records of all securities
transactions. Any records required to be maintained and
preserved pursuant to the provisions of Rule 31a-1 and Rule 31a-
2 promulgated under the 1940 Act that are prepared or
maintained by the Sub-Adviser on behalf of the Trust are the
property of the Trust and will be surrendered promptly to the
Trust upon request, provided however, the Trust shall make
available the originals of such records if required for any legal,
regulatory or other proceeding. The Sub-Adviser further agrees to
preserve for the periods prescribed in Rule 31a-2 under the 1940
Act the records required to be maintained under Rule 31a-1
under the 1940 Act, and will furnish the Board and UBS AM with
such periodic and special reports as the Board or UBS AM may
request.
(g) At such times as shall be reasonably requested by the
Board or UBS AM, the Sub-Adviser will provide the Board and UBS
AM with economic and investment analyses and reports as well
as quarterly reports setting forth the performance of the Portfolio
or Segment and make available to the Board and UBS AM any
economic, statistical and investment services that the Sub-
Adviser normally makes available to its institutional or other
customers.
(h) In accordance with procedures adopted by the Board, as
amended from time to time, and provided to the Sub-Adviser, the
Sub-Adviser is responsible for assisting the Board and UBS AM in
the fair valuation of all portfolio securities in the Portfolio or
Segment and will use its reasonable efforts to arrange for the
provision of a price or prices from one or more parties
independent of the Sub-Adviser for each portfolio security for
which the custodian does not obtain prices in the ordinary course
of business from an automated pricing service.
The Sub-Adviser also will provide such information or perform
such additional acts as are customarily performed by a Sub-
Adviser and may be required for the Trust or UBS AM to comply
with their respective obligations under applicable federal
securities laws, including, without limitation, the
1940 Act, the Advisers Act, the 1934 Act, the Securities Act, and
any rule or regulation thereunder.
3. Further Duties. In all matters relating to the performance
of this Agreement, the Sub-Adviser will seek to act in conformity
with the Trust's Trust Instrument, By-Laws and Registration
Statement, the Trust's policies and procedures for compliance by
the Trust with the Federal Securities Laws (as that term is defined
in Rule 38a-1 under the 1940 Act) provided to the Sub-Adviser
(together, the "Trust Compliance Procedures") and with the
written instructions and written directions of the Board and UBS
AM, and will comply with the requirements of the 1940 Act, and
the Advisers Act, and the rules under each, the Code, and all
other federal and state laws and regulations applicable to the
Trust and the Portfolio. UBS AM agrees to provide to the Sub-
Adviser copies of the Trust's Trust Instrument, By-Laws,
Registration Statement, Trust's Compliance Procedures, written
instructions and directions of the Board and UBS AM, and any
amendments or supplements to any of these materials as soon as
practicable after such materials become available. The Sub-
Adviser shall not be liable in any way for failure to adhere to any
amendments or supplements to such materials unless the Sub-
adviser has been notified of such amendments or supplements by
the Trust in accordance with this section. UBS AM further agrees
to identify to the Sub-Adviser in writing any broker-dealers that
are affiliated with UBS AM (other than UBS Financial Services Inc.
and UBS Asset Management (US) Inc.).
In order to assist the Trust and the Trust's Chief Compliance
Officer (the "Trust CCO") to satisfy the requirements contained in
Rule 38a-1 under the 1940 Act, the Sub-Adviser shall provide to
the Trust CCO: (i) direct access to the Sub-Adviser's chief
compliance officer and/or other senior compliance
personnel, as reasonably requested by the Trust CCO; (ii)
quarterly reports confirming that the Sub-Adviser has complied
with the Trust Compliance Procedures in managing the Portfolio
or Segment; and (iii) quarterly certifications that there were no
Material Compliance Matters (as that term is defined by Rule
38a-1(e)(2)) that arose under the Trust Compliance Procedures
that related to the Sub-Adviser's management of the Portfolio or
Segment.
The Sub-Adviser shall promptly provide the Trust CCO with copies
of: (i) the Sub-Adviser's policies and procedures for compliance by
the Sub-Adviser with the Federal Securities Laws (together, the
"Sub-Adviser Compliance Procedures"), and (ii) any material
changes to the Sub-Adviser Compliance Procedures. The Sub-
Adviser shall cooperate fully with the Trust CCO so as to facilitate
the Trust CCO's performance of the Trust CCO's responsibilities
under Rule 38a-1 to review, evaluate and report to the Trust's
Board on the operation of the Sub-Adviser Compliance
Procedures, and shall promptly report to the Trust CCO any
Material Compliance Matter arising under the Sub-Adviser
Compliance Procedures involving the Portfolio or Segment. The
Sub-Adviser shall provide to the Trust CCO: (i) quarterly reports
confirming the Sub-Adviser's compliance with the Sub-Adviser
Compliance Procedures in managing the Portfolio or Segment,
and (ii) certifications that there were no Material Compliance
Matters involving the Sub-Adviser that arose under the Sub-
Adviser Compliance Procedures that affected the Portfolio or
Segment. At least annually, the Sub-Adviser shall provide a
certification to the Trust CCO to the effect that the Sub-Adviser
has in place and has implemented policies and procedures that
are reasonably designed to ensure compliance by the Sub-Adviser
with any applicable Federal Securities Laws, subject to such
interpretations as may be contained in the Trust Compliance
Procedures.
The Sub-Adviser will promptly provide UBS AM with information
(including information that is required to be disclosed in the
Trust's registration statement) with respect to the portfolio
managers responsible for the Portfolio or Segment and any
changes in the portfolio managers responsible for the Portfolio or
Segment.
The Sub-Adviser will promptly notify UBS AM of any pending
investigation, material litigation, administrative proceeding or any
other significant non-routine regulatory inquiry.
The Sub-Adviser will cooperate promptly and fully with UBS AM
and/or the Trust in responding to any regulatory or compliance
examinations or inspections (including information requests)
relating to the Trust, the Portfolio or UBS AM brought by any
governmental or regulatory authorities having appropriate
jurisdiction (including, but not limited to, the Securities and
Exchange Commission ("SEC")).
4. Expenses. During the term of this Agreement, the Sub-
Adviser will bear all expenses incurred by it in connection with its
services under this Agreement. Except as otherwise specifically
provided herein, the Sub-Adviser shall not be responsible for any
expenses incurred by the Trust, the Portfolio or UBS AM,
including, without limitation, fees of the Trust's independent
public accountants, legal counsel, transfer agent, custodian and
other service providers who are not employees of the Sub-
Adviser, brokerage commissions and other transaction-related
expenses, tax reporting or taxes levied against the Trust
(including capital gains or income tax as well as any potential
withholding taxes on any holdings), any of its property, interest
charges on any Portfolio borrowings, expenditures in connection
with the meetings of the Trust's shareholders and the Board (but
not including any expenditures incurred as a result of an
assignment or change in control as noted below) and fees and
expenses incurred in connection with the issuance, registration
and transfer of the Portfolio's shares.
Upon request by UBS AM, Sub-Adviser agrees to reimburse UBS
AM or the Trust for costs associated with generating and
distributing any Registration Statement (as defined herein) for
when the Sub-Adviser is given a copy of a draft of such
Registration Statement and fails to promptly disclose to UBS AM
facts then known to the Sub-Adviser or its personnel that would
require disclosure (or amendments to disclosure) in the Fund's
Registration Statement in time for such disclosure or
amendments to disclosure to be included in such Registration
Statement. The Sub-Adviser shall bear all reasonable expenses of
the Trust, if any, arising out of an assignment or change in control
of the Sub-Adviser.
5. Compensation.
(a) For the services provided and the expenses assumed by the
Sub-Adviser pursuant to this Agreement, UBS AM, not the
Portfolio, will pay to the Sub-Adviser a fee, computed daily and
payable monthly, at an annual rate of ____% of the average daily
net assets of the Portfolio or Segment allocated to its
management (computed in the manner specified in the
Management Agreement), and will provide the Sub-Adviser with
a schedule showing the manner in which the fee was computed.
If the Sub-Adviser is managing a Segment, its fees will be based
on the value of the assets of the Portfolio within the Sub-
Adviser's Segment.
(b) The fee shall be accrued daily and payable monthly to the
Sub-Adviser on or before the last business day of the next
succeeding calendar month.
(c) For those periods in which UBS AM has agreed to waive all
or a portion of its management fee, UBS AM may ask the Sub-
Adviser to waive the same proportion of its fees, but the Sub-
Adviser is under no obligation to do so.
(d) If this Agreement becomes effective or terminates before
the end of any month, the fee for the period from the effective
date to the end of the month or from the beginning of such
month to the date of termination, as the case may be, shall be
pro-rated according to the proportion which such period bears to
the full month in that such effectiveness or termination occurs.
6. Limitation of Liability.
(a) The Sub-Adviser shall not be liable for any error of
judgment or mistake of law or for any loss suffered by the
Portfolio, the Trust or its shareholders or by UBS AM in
connection with the matters to which this Agreement relates,
except a loss resulting from willful misfeasance, bad faith or
negligence on its part in the performance of its duties or from
reckless disregard by it of its obligations and duties under this
Agreement.
(b) In no event will the Sub-Adviser have any responsibility for
any other portfolio of the Trust, for any portion of the Portfolio
not managed by the Sub-Adviser or for the acts or omissions of
any Other Sub-Adviser or service provider to the Trust or
Portfolio, including, but not limited to, the custodian. In
particular, in the event the Sub-Adviser shall manage only a
Segment of the Portfolio, the Sub-Adviser shall have no
responsibility for the Portfolio's being in violation of any
applicable law or regulation or investment policy or restriction
applicable to the Portfolio as a whole or for the Portfolio's failing
to qualify as a regulated investment company under the Code, if
the securities and other holdings of the Segment of the Portfolio
managed by the Sub-Adviser are such that such Segment would
not be in such violation or fail to so qualify if such Segment were
deemed a separate series of the Trust or a separate regulated
investment company under the Code, unless such violation was
due to the Sub-Advisers failure to comply with written guidelines
adopted by the Board or UBS AM and provided to the Sub-
Adviser.
Nothing in this section shall be deemed a limitation or waiver of
any obligation or duty that may not by law be limited or waived.
7. Representations of Sub-Adviser. The Sub-Adviser
represents, warrants and agrees as follows:
(a) The Sub-Adviser (i) is registered as an investment adviser
under the Advisers Act and will continue to be so registered for so
long as this Agreement remains in effect; (ii) is not prohibited by
the 1940 Act or the Advisers Act from performing the services
contemplated by this Agreement; (iii) has met, and will seek to
continue to meet for so long as this Agreement remains in effect,
any other applicable federal or state requirements, or the
applicable requirements of any regulatory or industry
self-regulatory agency, necessary to be met in order to perform
the services contemplated by this Agreement; (iv) has the
authority to enter into and perform the services contemplated by
this Agreement; and (v) will promptly notify UBS AM of the
occurrence of any event that would disqualify the Sub-Adviser
from serving as an investment adviser of an investment company
pursuant to Section 9(a) of the 1940 Act or otherwise.
(b) The Sub-Adviser has adopted a written code of ethics
complying with the requirements of Rule 17j-1 under the 1940
Act and Rule 204A-1 under the Advisers Act and will provide UBS
AM and the Board with a copy of such code of ethics, together
with evidence of its adoption. Within fifteen days of the end of
the last calendar quarter of each year that this Agreement is in
effect, a duly authorized officer of the Sub-Adviser shall certify to
UBS AM that the Sub-Adviser has complied with the requirements
of Rule 17j-1 during the previous year and that there has been no
material violation of the Sub-Adviser's code of ethics or, if such a
violation has occurred, that appropriate action was taken in
response to such violation. Upon the written request of UBS AM,
the Sub-Adviser shall permit UBS AM, its employees or its agents
to examine the reports required to be made by the Sub-Adviser
pursuant to Rule 17j-1(c)(1) and all other records relevant to the
Sub-Adviser's code of ethics.
(c) The Sub-Adviser has provided UBS AM with a copy of its
Form ADV, as most recently filed with the SEC, and promptly will
furnish a copy of all amendments to UBS AM at least annually.
(d) The Sub-Adviser will notify UBS AM of any change of
control of the Sub-Adviser, including any change of its general
partners or 25% shareholders or 25% limited partners, as
applicable, and any changes in the key personnel who are either
the portfolio manager(s) of the Portfolio or senior management
of the Sub-Adviser, in each case prior to or as soon after such
change as possible.
(e) The Sub-Adviser agrees that neither it nor any of its
affiliates, will in any way refer directly to its relationship with the
Trust, the Portfolio, UBS AM or any of their respective affiliates in
offering, marketing or other promotional materials without the
express written consent of UBS AM, and such consent not to be
unreasonably withheld.
(f) The Sub-Adviser hereby represents that it has
implemented policies and procedures that will prevent the
disclosure by it, its employees or its agents of the Trust's portfolio
holdings to any person or entity other than UBS AM, the Trust's
custodian, or other persons expressly designated by UBS AM.
The Sub-Adviser further represents that it implemented policies
and procedures to prevent it, its employees and agents from
trading on the basis of any material non-public information
provided by UBS AM, the Trust, their affiliates or agents.
(g) the Sub-Adviser hereby represents, warrants and agrees
that: (1) it is registered with the Commodity Futures Trading
Commission (the "CFTC") as a commodity trading advisor and is a
member of the National Futures Association (the "NFA") if
required in light of the nature of its activities, and will continue to
be so registered, if required, for so long as this Agreement
remains in effect; (2) it will comply with the Commodity Exchange
Act (the "CEA") and the rules of the CFTC and the NFA to the
extent applicable; and (3) it will provide all information
reasonably required by UBS AM to fulfill any disclosure and
reporting obligations of UBS AM with respect to the Portfolio
under the CEA and the rules of the CFTC and the NFA.
(h) The Sub-Adviser hereby represents and warrants that it has
(i) a sanctions policy in place and communicated to all employees
and (ii) adequate sanctions compliance controls reasonably
designed to ensure compliance with US, UN, EU and Swiss
sanctions laws and regulations and local applicable sanctions laws
(the "Sanctions Laws") The Sub-Adviser further represents and
warrants that (i) it will not undertake investments or engage in
activity that involves either directly or indirectly countries,
regimes, jurisdictions or sanctioned parties (individuals / entities)
subject to any Sanctions Laws and (ii) will not invest in securities /
issuers mentioned on the "Sanctions Securities List (SSSL)" and
the list of "Companies Verifiably Involved in Controversial
Weapons (Ethix List)" provided by UBS and updated from time to
time.
8. Representations of UBS. UBS represents, warrants, and
agrees as follows:
(a) UBS has all requisite power and authority to enter into and
perform its obligations under this Agreement, and has taken all
necessary corporate action to authorize its execution, delivery
and performance of this Agreement.
(b) UBS has the authority under the Advisory Agreement to
appoint the Sub-Adviser.
(c) UBS has received a copy of the Sub-Adviser's Form ADV, as
required by the Advisers Act and Disclosure Statement.
(d) The Sub-Adviser is not obligated to perform any service not
described in this Agreement and shall not be deemed by virtue of
this Agreement to have made any representations or warranty
that any level of investment performance or level of investment
results will be achieved.
9. Services Not Exclusive. The services furnished by the Sub-
Adviser hereunder are not to be deemed exclusive, and except as
the Sub-Adviser may otherwise agree in writing, the Sub-Adviser
shall be free to furnish similar services to others so long as its
services under this Agreement are not impaired thereby. Nothing
in this Agreement shall limit or restrict the right of any director,
officer or employee of the Sub-Adviser, who may also be a
trustee, officer or employee of the Trust, to engage in any other
business or to devote his or her time and attention in part to the
management or other aspects of any other business, whether of a
similar nature or a dissimilar nature. The Sub-Adviser, or any of its
directors, officers, employees or beneficial owners of the Sub-
Adviser may purchase, for his own account, the same securities as
are purchased for the Portfolio or Segment but all such purchases
will be made in compliance with the Personal Trading Code
adopted by the Sub-Adviser.
10. Duration and Termination.
(a) This Agreement shall become effective upon the date first
above written, provided that this Agreement shall not take effect
unless it has first been approved (i) by a vote of a majority of
those trustees of the Trust who are not parties to this Agreement
or interested persons of any such party ("Independent Trustees"),
cast in person at a meeting called for the purpose of voting on
such approval, and (ii) by vote of a majority of the Portfolio's
outstanding voting securities, unless UBS AM has authority to
enter into this Agreement pursuant to exemptive relief from the
SEC without a vote of the Portfolio's outstanding voting
securities.
(b) Unless sooner terminated as provided herein, this
Agreement shall continue in effect for two years from its effective
date. Thereafter, if not terminated, this Agreement shall continue
automatically for successive periods of twelve months each,
provided that such continuance is specifically approved at least
annually (i) by a vote of a majority of the Independent Trustees,
cast in person at a meeting called for the purpose of voting on
such approval, and (ii) by the Board or by vote of a majority of the
outstanding voting securities of the Portfolio.
(c) Notwithstanding the foregoing, this Agreement may be
terminated at any time, without the payment of any penalty, by
vote of the Board or by a vote of a majority of the outstanding
voting securities of the Portfolio on 30 days written notice to the
Sub-Adviser. This Agreement may also be terminated, without the
payment of any penalty, by UBS AM; (i) upon 120 days written
notice to the Sub-Adviser; (ii) upon material breach by the Sub-
Adviser of any of the representations, warranties and agreements
set forth in Paragraph 7 of this Agreement; or (iii) immediately if,
in the reasonable judgment of UBS AM, the Sub-Adviser becomes
unable to discharge its duties and obligations under this
Agreement, including circumstances such as financial insolvency
of the Sub- Adviser or other circumstances that could adversely
affect the Portfolio. The Sub-Adviser may terminate this
Agreement at any time, without the payment of any penalty, on
120 days written notice to UBS AM. This Agreement will
terminate automatically in the event of its assignment or upon
termination of the Investment Advisory Agreement, as it relates
to this Portfolio.
11. 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 whom enforcement of the change, waiver, discharge or
termination is sought. To the extent required by applicable law,
no amendment of this Agreement shall be effective until
approved (i) by a vote of a majority of the Independent Trustees,
and (ii) if the terms of this Agreement shall have changed, by a
vote of a majority of the Portfolio's outstanding voting securities
(except in the case of (ii), pursuant to the terms and conditions of
the SEC order permitting it to modify the Agreement without
such vote).
12. Governing Law. This Agreement shall be construed in
accordance with the 1940 Act and the laws of the State of New
York, without giving effect to the conflicts of laws principles
thereof. To the extent that the applicable laws of the State of
New York conflict with the applicable provisions of the 1940 Act,
the latter shall control. Each party hereby irrevocably waives all
right of trial by jury in any action, proceeding or counterclaim
arising out of or in connection with this Agreement, the Portfolio
or Segment, or any matter arising out of or relating thereto.
13. Confidentiality. The Sub-Adviser will treat as proprietary
and confidential any non-public information obtained in
connection with its duties hereunder, including all records and
information pertaining to the Portfolio and its prior, present or
potential shareholders. The Sub-Adviser will not use such
information for any purpose other than the performance of its
responsibilities and duties hereunder. Such information may not
be disclosed except after prior notification to and approval in
writing by the Portfolio or if such disclosure is expressly required
or requested by applicable federal or state or other regulatory
authorities.
14. Use of Name.
(a) It is understood that the names UBS and PACE or any
derivative thereof or logo associated with that name is the
valuable property of UBS AM and/or its affiliates, and that Sub-
Adviser has the right to use such name (or derivative or logo) only
with the approval of UBS AM, and such approval is not
unreasonably withheld, and only so long as UBS AM is Manager
to the Trust and/or the Portfolio.
(b) It is understood that the name PCJ Investment Counsel Ltd. or
any derivative thereof or logo associated with those names, are
the valuable property of the Sub-Adviser and its affiliates and that
the Trust and/or the Portfolio have the right to use such names
(or derivative or logo) in offering materials of the Trust with the
approval of the Sub-Adviser and for so long as the Sub-Adviser is
a Sub-Adviser to the Portfolio. Upon termination of this
Agreement, the Trust shall forthwith cease to use such names (or
derivatives or logo).
15. 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.
As used in this Agreement, the terms majority of the outstanding
voting securities, affiliated person, interested person, assignment,
broker, investment adviser, net assets, sale, sell and security shall
have the same meanings as such terms have in the 1940 Act,
subject to such exemption as may be granted by the SEC by any
rule, regulation or order. Where the effect of a requirement of
the federal securities laws reflected in any provision of this
Agreement is made less restrictive by a rule, regulation or order
of the SEC, whether of special or general application, such
provision shall be deemed to incorporate the effect of such rule,
regulation or order. This Agreement may be signed in
counterpart.
165. Notices. Any notice herein required is to be in writing and
is deemed to have been given to the Sub-Adviser or UBS AM upon
receipt of the same at their respective addresses set forth below.
All written notices required or permitted to be given under this
Agreement will be delivered by personal service, by postage mail
return receipt requested or by facsimile machine or a similar
means of same delivery which provides evidence of receipt (with
a confirming copy by mail as set forth herein). All notices
provided to UBS AM will be sent to the attention of: General
Counsel, UBS Asset Management (Americas) Inc., ▇▇▇▇ ▇▇▇▇▇▇ ▇▇
▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇. All notices provided to the
Sub-Adviser will be sent to the attention of PCJ Investment
Counsel Ltd., ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇,
▇▇▇ ▇▇▇ Attention: ▇▇▇▇▇ Piticco Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇.
In witness whereof, the parties hereto have caused this
instrument to be executed by their duly authorized signatories as
of the date and year first above written.
UBS Asset Management (Americas) Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇: ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
By:/s/ ▇▇▇▇ ▇▇▇▇▇▇▇ By:/s/ ▇▇▇▇▇ ▇▇▇▇
Name: ▇▇▇▇ ▇▇▇▇▇▇▇ Name: ▇▇▇▇▇ ▇▇▇▇
Title: Director Title: Managing Director
PCJ Investment Counsel Ltd.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇. Suite 300
Toronto, Ontario M5H 3M7
Attest:
By:/s/ Heiki Altosaar By:/s/ ▇▇▇▇▇ Piticco
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Name: ▇▇▇▇▇ Piticco
Title: Chief Compliance Officer Title: President
