EXHIBIT (D)(18)(A)
PREFERRED SMALL CAP GROWTH FUND
AMENDMENT TO SUBADVISER AGREEMENT
AMENDMENT dated September 1, 2002 (this "Amendment") to the Subadviser
Agreement dated as of January 1, 2000 (the "Subadviser Agreement") by and
between Caterpillar Investment Management Ltd. (the "Manager") and Xxxxxx
Investment Partners, Inc. (the "Subadviser").
W I T N E S S E T H:
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WHEREAS, the Manager has requested that the Subadviser agree to amend the
Subadviser Agreement in the manner provided for herein; and
WHEREAS, the Subadviser is willing to amend the Subadviser Agreement in the
manner provided for herein;
NOW, THEREFORE, in consideration of the premises and the mutual agreements
contained herein, the parties hereto agree as follows:
SECTION 1. DEFINITIONS AND SECTION REFERENCES
1.1. Defined Terms. Unless otherwise defined herein, terms which are
defined in the Subadviser Agreement and used herein are so used as so defined.
1.2. Section References. Unless otherwise indicated, all section and
subsection references are to the Subadviser Agreement.
SECTION 2. AMENDMENTS TO SUBADVISER AGREEMENT
2.1. Amendment to Section 1(a). Section 1(a) of the Subadviser Agreement is
hereby amended to read in its entirety as follows:
(a) Subject always to the control of the Manager (to the extent
contemplated by this Agreement and the Management Contract described
in Section 4 hereof) and the trustees of The Preferred Group of Mutual
Funds (the "Trustees"), a Massachusetts business trust (the "Trust"),
including the Manager's authority to determine what securities or
other property shall be purchased or sold by or for the Preferred
Small Cap Growth Fund series of the Trust (the "Fund"), the
Subadviser, at its expense, will furnish continuously an investment
program for the Fund and will make investment decisions on behalf of
the Fund and place all orders for the purchase and sale of portfolio
securities and all other investments. In the performance of its
duties, the Subadviser (i) will comply with the provisions of the
Trust's Agreement and Declaration of Trust and By-laws, including any
amendments thereto (upon receipt of such amendments by the
Subadviser), and the investment objectives, policies and restrictions
of the Fund as set forth in its current Prospectus and Statement of
Additional Information (copies of which will be supplied to
the Subadviser upon filing with the Securities and Exchange
Commission), (ii) will use its best efforts to safeguard and promote
the welfare of the Fund, (iii) will comply with other policies which
the Trustees or the Manager, as the case may be, may from time to time
determine as promptly as practicable after such policies have been
communicated to the Subadviser in writing, and (iv) shall exercise the
same care and diligence expected of the Trustees. The Subadviser and
the Manager shall each make its officers and employees available to
the other from time to time at reasonable times to review investment
policies of the Fund and to consult with each other regarding the
investment affairs of the Fund.
2.2. Amendment to Section 1(c). Section 1(c) of the Subadviser Agreement is
hereby amended to read in its entirety as follows:
(c) In the selection of brokers, dealers or futures commissions merchants
(collectively, "brokers") and the placing of orders for the purchase
and sale of portfolio investments for the Fund, the Subadviser shall
comply with such policies established by the Trustees or the Manager
and communicated to the Subadviser in writing and shall seek to obtain
for the Fund the most favorable price and execution available, except
to the extent it may be permitted to pay higher brokerage commissions
for brokerage and research services as described below. In using its
best efforts to obtain for the Fund the most favorable price and
execution available, the Subadviser, bearing in mind the Fund's best
interests at all times, shall consider all factors it deems relevant,
including, by way of illustration, price, the size of the transaction,
the nature of the market for the security, the amount of the
commission, the timing of the transaction taking into account market
prices and trends, the reputation, experience and financial stability
of the broker involved and the quality of service rendered by the
broker in other transactions. Subject to such policies as the Trustees
or the Manager may determine and communicate to the Subadviser in
writing, the Subadviser shall not be deemed to have acted unlawfully
or to have breached any duty created by this Agreement or otherwise
solely by reason of its having caused the Fund to pay a broker that
provides brokerage and research services to the Subadviser or any
affiliated person of the Subadviser an amount of commission for
effecting a portfolio investment transaction in excess of the amount
of commission another broker would have charged for effecting that
transaction, if the Subadviser determines in good faith that such
amount of commission was reasonable in relation to the value of the
brokerage and research services provided by such broker, viewed in
terms of either that particular transaction or the Subadviser's
overall responsibilities with respect to the Fund and to other clients
of the Subadviser and any affiliated person of the Subadviser as to
which the Subadviser or any affiliated person of the Subadviser
exercises investment discretion. The Trust agrees that any entity or
person associated with the Subadviser or any affiliated person of the
Subadviser which is a member of a national securities exchange is
authorized to effect any transaction on such exchange for the account
of the Fund which is permitted by Section 11(a) of the Securities
Exchange Act of 1934, as amended (the "1934 Act"), and Rule 11a2-2(T)
thereunder, and the Trust hereby consents to the retention of
compensation for such transactions in accordance with Rule
11a2-2(T)(2)(iv).
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SECTION 3. MISCELLANEOUS.
3.1. Continuing Effect. Except as expressly amended hereby, all of the
terms and provisions of the Subadviser Agreement are and shall remain in full
force and effect.
3.2. Counterparts. This Amendment may be executed in any number of
counterparts by the parties hereto (including by facsimile transmission), each
of which counterparts when so executed shall be an original, but all the
counterparts shall together constitute one and the same instrument.
3.3. Governing Law. This Amendment shall be governed by, and construed and
interpreted in accordance with, the laws governing the Subadviser Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed and delivered by their respective duly authorized officers as of the
date first above written.
CATERPILLAR INVESTMENT MANAGEMENT LTD.
By: _______________________________
Name:
Title:
XXXXXX INVESTMENT PARTNERS, INC.
By: _______________________________
Name:
Title:
The foregoing is accepted by:
THE PREFERRED GROUP OF MUTUAL FUNDS
By: _________________________________
Name:
Title:
