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EXHIBIT 99.B5.1
SUBADVISORY AGREEMENT
THIS AGREEMENT is made and entered into on this 25th day of June, 1993
between STRONG/CORNELIUSON CAPITAL MANAGEMENT, INC. (the "Adviser"), a
Wisconsin corporation registered under the Investment Advisers Act of 1940, as
amended (the "Advisers Act"), and X.X. XXXXXX & CO., INC. (the "Subadviser"), a
Delaware corporation registered under the Advisers Act;
W I T N E S S E T H :
WHEREAS, Strong American Utilities Fund, Inc., a Wisconsin
corporation, is in the process of registering with the U.S. Securities and
Exchange Commission (the "Commission") as an open-end management investment
company under the U.S. Investment Company Act of 1940, as amended (the
"Investment Company Act"); and
WHEREAS, the Fund has, pursuant to an Advisory Agreement with the
Adviser dated as of June 22, 1993 (the "Advisory Agreement"), retained the
Adviser to act as investment adviser for and to manage its assets;
WHEREAS, the Advisory Agreement permits the Adviser to delegate
certain of its duties under the Advisory Agreement to other investment
advisers, subject to the requirements of the Investment Company Act; and
WHEREAS, the Adviser desires to retain the Subadviser as subadviser for
the Fund to act as investment adviser for and to manage the Fund's Investments
(as defined below) and the Subadviser desires to render such services.
NOW, THEREFORE, the Adviser and Subadviser do mutually agree and
promise as follows:
1. Appointment as Subadviser. The Adviser hereby retains the
Subadviser to act as investment adviser for and to manage certain assets of the
Fund subject to the supervision of the Adviser and the Board of Directors of
the Fund and subject to the terms of this Agreement; and the Subadviser hereby
accepts such employment. In such capacity, the Subadviser shall be responsible
for the Fund's investments.
2. Duties of Subadviser.
(a) Investments. The Subadviser is hereby authorized and
directed and hereby agrees, subject to the stated investment policies
and restrictions of the Fund as set forth in the Fund's current
prospectus and statement of
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additional information as currently in effect and as supplemented or
amended from time to time (collectively referred to hereinafter as the
"Prospectus") and subject to the directions of the Adviser and the
Fund's Board of Directors, to purchase, hold and sell investments
for the account of the Fund (hereinafter "Investments") and to monitor
on a continuous basis the performance of such Investments.
(b) Allocation of Brokerage. The Subadviser is
authorized, subject to the supervision of the Adviser and the Board of
Directors of the Fund, to place orders for the purchase and sale of
the Fund's Investments with or through such persons, brokers or
dealers, including the Subadviser or affiliates thereof, and to
negotiate commissions to be paid on such transactions in
accordance with the Fund's policy with respect to brokerage as set
forth in the Prospectus. The Subadviser may, on behalf of the Fund,
pay brokerage commissions to a broker which provides brokerage and
research services to the Subadviser in excess of the amount another
broker would have charged for effecting the transaction, provided (i)
the Subadviser determines in good faith that the amount is reasonable
in relation to the value of the brokerage and research services
provided by the executing broker in terms of the particular
transaction or in terms of the Subadviser's overall responsibilities
with respect to the Fund and the accounts as to which the Subadviser
exercises investment discretion, (ii) such payment is made in
compliance with Section 28(e) of the Securities Exchange Act of 1934,
as amended, and any other applicable laws and regulations, and (iii)
in the opinion of the Subadviser, the total commissions paid by the
Fund will be reasonable in relation to the benefits to the Fund over
the long term. It is recognized that the services provided by such
brokers may be useful to the Subadviser in connection with the
Subadviser's services to other clients. On occasions when the
Subadviser deems the purchase or sale of a security to be in the best
interests of the Fund as well as other clients of the Subadviser, the
Subadviser, to the extent permitted by applicable laws and
regulations, may, but shall be under no obligation to, aggregate the
securities to be sold or purchased in order to obtain the most
favorable price or lower brokerage commissions and efficient
execution. In such event, allocation of securities so sold or
purchased, as well as the expenses incurred in the transaction, will
be made by the Subadviser in the manner the Subadviser considers to be
the most equitable and consistent with its fiduciary obligations to
the Fund and to such other clients.
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(c) Securities Transactions. The Subadviser and any
affiliated person of the Subadviser will not purchase securities or
other instruments from or sell securities or other instruments to the
Fund; provided, however, the Subadviser may purchase securities or
other instruments from or sell securities or other instruments to the
Fund if such transaction is permissible under applicable laws and
regulations, including, without limitation, the Investment Company Act
and the Investment Advisers Act and the rules and regulations
promulgated thereunder.
The Subadviser agrees to observe and comply with Rule 17j-1
under the Investment Company Act and the Fund's Code of Ethics, as the
same may be amended from time to time. The Subadviser will make
available to the Adviser or the Fund at any time upon request,
including telecopy without delay, during any business day any reports
required to be made to the Subadviser pursuant to Rule 17j-1 under the
Investment Company Act.
(d) Books and Records. The Subadviser will maintain all
books and records required to be maintained pursuant to the Investment
Company Act and the rules and regulations promulgated thereunder with
respect to transactions made by it on behalf of the Fund including,
without limitation, the books and records required by Subsections
(b)(1), (5), (6), (7), (9), (10) and (11) and Subsection (f) of Rule
31a-1 under the Investment Company Act and shall timely furnish to the
Adviser all information relating to the Subadviser's services
hereunder needed by the Adviser to keep such other books and records
of the Fund required by Rule 31a-1 under the Investment Company Act.
The Subadviser will also preserve all such books and records for the
periods prescribed in Rule 31a-2 under the Investment Company Act, and
agrees that such books and records shall remain the sole property of
the Fund and shall be immediately surrendered to the Fund upon
request. The Subadviser further agrees that all books and records
maintained hereunder shall be made available to the Fund or the
Adviser at any time upon request, including telecopy without delay,
during any business day.
(e) Information Concerning Investments and Subadviser. From
time to time as the Adviser or the Fund may request, the Subadviser
will furnish the requesting party reports on portfolio transactions
and reports on Investments held in the portfolio, all in such detail
as the Adviser or the Fund may request. The Subadviser will also
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provide the Fund and the Adviser on a regular basis with economic and
investment analyses and reports or other investment services normally
available to institutional or other clients of the Subadviser.
The Subadviser will make available its officers and employees
to meet with the Fund's Board of Directors at the Fund's principal
place of business on due notice to review the Investments of the
Fund. The Subadviser further agrees to inform the Fund and the
Adviser on a current basis of changes in investment strategy, tactics
or key personnel.
The Subadviser will also provide such information or perform
such additional acts as are customarily performed by a subadviser and
may be required for the Fund or the Adviser to comply with their
respective obligations under applicable laws, including, without
limitation, the Internal Revenue Code of 1986, as amended (the
"Code"), the Investment Company Act, the Investment Advisers Act, the
Securities Act of 1933, as amended (the "Securities Act") and any
state securities laws, and any rule or regulation thereunder.
(f) Custody Arrangements. The Subadviser acknowledges
receipt of a Custody Agreement dated as of June 10, 1993, for the Fund
and agrees to comply at all times with all requirements relating to
such arrangements. The Subadviser shall provide the Adviser, and the
Adviser shall provide the Fund's custodian, on each business day with
information relating to all transactions concerning the Fund's assets.
(g) Adviser Representatives. The Subadviser shall include at
least two (2) representatives of the Adviser, as specified by the
Adviser, in the list of individuals authorized to give directions
(without restrictions of any kind) to brokers and dealers utilized by
the Subadviser to execute portfolio transactions for the Fund and
custodians or depositories that hold securities or other assets of the
Fund at any time. Subadviser shall have no liability or responsibility
for the actions of such representatives of the Adviser.
(h) Compliance with Applicable Laws and Governing Documents.
The Subadviser agrees that in all matters relating to its performance
under this Agreement, the Subadviser and its directors, officers,
partners, employees and interested persons, will act in accordance
with all applicable laws, including, without limitation, the
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Investment Company Act, the Investment Advisers Act, the Code, the
Public Utility Holding Company Act of 1935, the Commodity Exchange
Act, as amended (the "CEA") and state securities laws, and any rules
and regulations promulgated thereunder. The Subadviser further
agrees to act in accordance with the Fund's Articles of Incorporation,
By-Laws, currently effective registration statement under the
Investment Company Act, including any amendments or supplements
thereto, and Notice of Eligibility under Rule 4.5 of the CEA, if
applicable, (collectively, "Governing Instruments and Regulatory
Filings") and any instructions or directions of the Fund, its Board of
Directors or the Adviser.
The Subadviser acknowledges receipt of the Fund's Governing
Instruments and Regulatory Filings. The Adviser hereby agrees to
provide to the Subadviser any amendments, supplements or other
changes to the Governing Instruments and Regulatory Filings as soon as
practiceable after such materials become available and, upon receipt
by the Subadviser, the Subadviser will act in accordance with such
amended, supplemented or otherwise changed Governing Instruments and
Regulatory Filings.
(i) Fund's Name: Adviser's Name. The Subadviser agrees
that it shall have no rights of any kind relating to the Fund's name,
"Strong American Utilities Fund, Inc.," or in the name "Strong"
as it is used in connection with investment products, services or
otherwise, and that it shall make no use of such names without the
express written consent of the Fund or the Adviser, as the case may
be.
(j) Voting of Proxies. The Subadviser shall direct the
custodian as to how to vote such proxies as may be necessary or
advisable in connection with the any matters submitted to a
vote of shareholders of securities held by the Fund.
3. Services Exclusive.
(a) Exclusive Investment Advise. Except as provided in
Subsection (b) of this Section 3 or as otherwise agreed to in writing
between the parties hereto, during the term of this Agreement, as
provided in Section 14 hereof, and for a period of two (2) years after
the date the Subadviser gives notice to the Adviser of its intention
to terminate this Agreement or six (6) months after the date the
Adviser gives notice to the Subadviser of its intention to terminate
this Agreement, the Subadviser (which for
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purposes of this Section 3 shall also include any successors to the
Subadviser), and any person or entity controlled by, or under common
control with, the Subadviser, shall not act as investment adviser or
subadviser, or otherwise render investment advice to, or sponsor,
promote or distribute, any investment company or comparable
entity registered under the Investment Company Act or other investment
fund consisting of more than 100 investors that is offered publicly
but is not subject to the registration requirements of the Investment
Company Act that is substantially similar to the Fund. For purposes
hereof, BMC Fund, Inc. and Wall Street Preferred Money Managers are
not, as such accounts are presently operating and managed by the
Subadviser, substantially similar to the Fund.
(b) Exceptions. The Subadviser may, except as provided in
Subsection (a) of this Section 3, act as investment adviser for
non-investment company clients; provided, however, that such services
for others shall not in any way hinder, impair, preclude or prevent
the Subadviser from performing its duties and obligations under
this Agreement and that whenever the Fund and one or more other
accounts advised by the subadviser have available funds for
investment, investments suitable and appropriate for each will be
allocated in accordance with procedures that are equitable for each
account. Similarly, opportunities to sell securities will be allocated
in an equitable manner.
4. Non-Competition. The Subadviser and any person or entity
controlled by the Subadviser will not in any manner sponsor, promote or
distribute any new investment product or service substantially similar to the
Fund, as such phrase is used in Section 3 hereof, for the period that the
Subadviser is required to provide exclusive services to the Fund pursuant to
Section 3 hereof.
5. Independent Contractor. In the performance of its duties
hereunder, the Subadviser 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 Fund or the Adviser in any way or
otherwise be deemed an agent of the Fund or the Adviser.
6. Compensation. The Adviser shall pay to the Subadviser a fee for
its services hereunder (the "Subadvisory Fee") computed as follows, based on
the net asset value of the Fund:
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(a) Fee Rate. The Subadvisory Fee shall be the sum of (i)
the annual rate of 0.50% of the Fund's average daily net asset value
on the first $200 million of the Fund's net assets (regardless of any
decision by the Adviser to waive all or any portion of its management
fee), (ii) 40% of the total management fee collected by the Adviser
from the Fund on the Fund's net assets over $200 million and up to
$1.0 billion, (iii) 50% of the total management fee collected by the
Adviser from the Fund on the Fund's net assets over $1.0 billion and
up to $1.5 billion, and (iv) 40% of the total management fee collected
by the Adviser from the Fund on the Fund's net assets over $1.5
billion. In connection with subsections (a) (ii), (iii) and (iv)
hereof, Subadviser acknowledges and agrees that the Adviser may waive
all or any portion of its management fee at such times and for such
periods of time as it determines in its sole and absolute discretion.
(b) Most Favored Client Compensation Disclosure. In the
event the Subadviser charges any of its similarly situated advisory
clients on a more favorable compensation basis, the Subadviser shall
immediately notify and fully disclose to the Adviser the nature and
exact terms of such arrangement.
(c) Method of Computation; Payment. The Subadvisory Fee
shall be accrued for each calendar day the Subadviser renders
subadvisory services hereunder and the sum of the daily fee accruals
shall be paid monthly to the Subadviser as soon as practicable
following the last day of each month, by wire transfer if so requested
by the Subadviser, but no later than eight (8) calendar days
thereafter. The daily fee accruals on the first $200 million of the
Fund's net assets will be computed by multiplying the fraction of one
(1) over the number of calendar days in the year by the annual rate as
described in Subsection (a)(i) of this Section 6 and multiplying the
product by the net asset value of the Fund as determined in accordance
with the Fund's prospectus as of the close of business on the previous
business day on which the Fund was open for business. The daily fee
accruals on the Fund's net assets in excess of $200 million and up to
$1.0 billion, in excess of $1.0 billion and up to $1.5 billion, and in
excess of $1.5 billion, will be computed for each the three foregoing
ranges by multiplying (i) the fraction of one (1) over the number of
calendar days in the year by (ii) the annual rate of the Fund's
management fee on that date after giving effect to any waivers of such
fee by the Adviser in place at such time and multiplying the product
by (iii) the
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applicable fee percentage for such range and, finally, multiplying
that product by (iv) the net asset value of the Fund as determined in
accordance with the Fund's prospectus as of the close of business on
the previous business day on which the Fund was open for business.
7. Commissions. The Adviser understands that the Subadviser may act as
executing and clearing broker in connection with the transactions effected by
the Fund and that the Subadviser will be paid commissions by the Fund in
connection therewith in accordance with all applicable laws, including, but not
limited to Rule 17e-1 promulgated under the Investment Company Act.
Notwithstanding the foregoing, under no circumstances shall the commissions
paid to the Subadviser on such transactions exceed the lesser of (a) fifty
percent (50%) of the regular New York Stock Exchange rates in effect
immediately prior the institution of fully negotiated rates on May 1, 1975, or
(ii) six cents ($0.06) per share.
8. Expenses. The Subadviser shall bear all expenses incurred by it in
connection with its services under this Agreement and will, from time to time,
at its sole expense employ or associate itself with such persons as it believes
to be particularly fitted to assist it in the execution of its duties hereunder.
9. Startup Costs. The Subadviser shall contribute to the payment of the
Fund's startup costs (the "Startup Contribution"). The startup costs include,
but are not limited to, those resulting from shareholder communications,
initial promotion and advertising, management fee waivers by the Adviser and
Adviser's subsidization of various other Fund expenses. The Startup
Contribution shall be paid and computed as follows:
(a) Startup Contribution Rate. The Startup Contribution shall
be (i) at the annual rate of 0.25% of the Funds average daily net
asset value until the earlier to occur of (A) the date the net assets
of the Fund exceed $100 million or (B) the date which is 12 months
from the date the Fund commences operations and thereafter (ii) at
the annual rate of 0.15% of the Funds average daily net asset value
until the earlier to occur of (A) the date the net assets of the Fund
exceed $200 million or (B) the date which is 24 months from the date
the Fund commences operations, at which time, and after the payment
of the foregoing fees, the Subadviser's obligation to contribute to
the Fund's startup costs shall terminate.
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(b) Method of Computation; Payment. The Startup Contribution
shall be accrued for each calendar day the Subadviser renders subadvisory
services hereunder and the sum of the daily contribution accruals shall be
paid monthly to the Adviser as soon as practicable following the last day
of each month but no later than ten (10) calendar days thereafter. The
daily contribution accruals will be computed by multiplying the fraction of
one (1) over the number of calendar days in the year by the annual rate as
described in Subsection (a) of this Section 8 and multiplying the product
by the net asset value of the Fund as determined in accordance with the
Fund's prospectus as of the close of business on the previous business day
on which the Fund was open for business.
10. Representations and Warranties of Subadviser. The Subadviser
represents and warrants to the Adviser and the Fund as follows:
(a) The Subadviser is registered as an investment adviser under
the Investment Advisers Act;
(b) The Subadviser has filed a notice of exemption pursuant to
Rule 4.14 under the CEA with the Commodity Futures Trading Commission (the
"CFTC") and the National Futures Association;
(c) The Subadviser is a corporation duly organized and validly
existing under the laws of the State of Delaware with the power to own and
possess its assets and carry on its business as it is now being conducted;
(d) The execution, delivery and performance by the Subadviser of
this Agreement are within and Subadviser's powers and have been duly
authorized by all necessary action on the part of its shareholders, and no
action by or in respect of, or filing with, any governmental body, agency
or official is required on the part of the Subadviser for the execution,
delivery and performance by the Subadviser of this Agreement, and the
execution, delivery and performance by the Subadviser of this Agreement do
not contravene or constitute a default under (i) any provision of
applicable law, rule or regulation, (ii) the Subadviser's governing
instruments, or (iii) any agreement, judgment, injunction, order, decree or
other instrument binding upon the Subadviser;
(e) This Agreement is a valid and binding agreement of the
Subadviser;
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(f) The Subadviser and any affiliated person of the Subadviser
have not:
(i) within 10 years from the date hereof been convicted
of any felony or misdemeanor involving the purchase or sale of any
securities or arising out of the conduct as an underwriter, broker,
dealer, investment adviser, municipal securities dealer, government
securities broker, government securities dealer, transfer agent, or
entity or person required to be registered under the CEA, or as an
affiliated person, salesman, or employee of any investment company,
bank, insurance company, or entity or person required to be
registered under the CEA; or
(ii) by reason of any misconduct, been permanently or
temporarily enjoined by an order, judgment or decree of any court of
competent jurisdiction or other governmental authority from acting as
an underwriter, broker, dealer, investment adviser, municipal
securities dealer, government securities broker, government securities
dealer, transfer agent, or entity or person required to be registered
under the CEA, or an affiliated person, salesman, or employee of any
investment company, bank, insurance company, or entity or person
required to be registered under the CEA or from engaging in or
continuing any conduct or practice in connection with any such
activity or in connection with the purchase or sale of any security;
or
(iii) been a party to litigation or other adversarial
proceedings involving any former or current client;
(g) The Form ADV of the Subadviser attached hereto as Exhibit A is a
true and complete copy of the form filed with the Commission and the
information contained therein is accurate and complete in all material
respects and does not omit to state any material fact necessary in order
to make the statements made, in light of the circumstances under which
they were made, not misleading;
(h) The Subadviser's audited financial statements attached hereto as
Exhibit B for the fiscal years ended November 30, 1992, 1991 and 1990 are
true and complete copies of the Subadviser's financial statements, are
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accurate and complete in all material respects and do not omit to
state any material fact necessary in order to make the statements
made, in light of the circumstances under which they were made, not
misleading;
(i) The Subadviser's performance figures for certain
client accounts attached hereto as Exhibit C are accurate and
complete in all material respects and do not omit to state any
material fact necessary in order to make the statements made, in light
of the circumstances under which they were made, not misleading; and
(j) The Subadviser's written code of ethics attached
hereto as Exhibit D has been duly adopted by the Subadviser, meets
the requirements of Rule 17j-1 under the Investment Company
Act and such code has been complied with and no violation has
occurred.
11. Representations and Warranties of Adviser. The Adviser represents
and warrants to the Subadviser as follows:
(a) The Adviser is registered as an investment adviser
under the Investment Advisers Act;
(b) The Adviser has filed a notice of exemption
pursuant to Rule 4.14 under the CEA with the Commodity Futures
Trading Commission (the "CFTC") and the National Futures Association;
(c) The Adviser is a corporation duly organized and
validly existing under the laws of the State of Wisconsin with
the power to own and possess its assets and carry on its business as
it is now being conducted;
(d) The execution, delivery and performance by the
Adviser of this Agreement are within and Adviser's powers and
have been duly authorized by all necessary action on the part of its
shareholders, and no action by or in respect of, or filing with, any
governmental body, agency or official is required on the part of the
Adviser for the execution, delivery and performance by the Adviser of
this Agreement, and the execution, delivery and performance by the
Adviser of this Agreement do not contravene or constitute a default
under (i) any provision of applicable law, rule or regulation, (ii)
the Adviser's governing instruments, or (iii) any agreement, judgment,
injunction, order, decree or other instrument binding upon the
Adviser;
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(e) This Agreement is a valid and binding agreement of the Adviser;
(f) The Adviser and any affiliated person of the Subadviser have not:
(i) within 10 years from the date hereof been convicted of any
felony or misdemeanor involving the purchase or sale of any securities or
arising out of the conduct as an underwriter, broker, dealer, investment
adviser, municipal securities dealer, government securities broker,
government securities dealer, transfer agent, or entity or person
required to be registered under the CEA, or as an affiliated person,
salesman, or employee of any investment company, bank, insurance
company, or entity or person required to be registered under the CEA;
or
(ii) by reason of any misconduct, been permanently or
temporarily enjoined by an order, judgment or decree of any court of
competent jurisdiction or other governmental authority from acting as
an underwriter, broker, dealer, investment adviser, municipal securities
dealer, government securities broker, government securities dealer,
transfer agent, or entity or person required to be registered under the
CEA, or an affiliated person, salesman, or employee of any investment
company, bank, insurance company, or entity or person required to be
registered under the CEA or from engaging in or continuing any conduct
or practice in connection with any such activity or in connection with
the purchase or sale of any security; or
(iii) been a party to litigation or other adversarial
proceedings involving any former or current client;
(g) The Form ADV of the Adviser attached hereto as Exhibit E is a true
and complete copy of the form filed with the Commission and the information
contained therein is accurate and complete in all material respects and does
not omit to state any material fact necessary in order to make the statements
made, in light of the circumstances under which they were made, not misleading;
(h) The Adviser acknowledges that it received a copy of the
Subadviser's Form ADV at least 48 hours prior to the execution of this
Agreement.
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12. Survival of Representations and Warranties: Duty to Update
Information. All representations and warranties made by the Subadviser and the
Adviser pursuant to Sections 9 and 10 hereof shall survive for the duration of
this Agreement and the parties hereto shall immediately notify, but in no event
late than five (5) business days, each other in writing upon becoming aware
that any of the foregoing representations and warranties are no longer true. In
addition, the Subadviser will deliver to the Adviser and the Fund copies of any
amendments, supplements or updates to any of the information provided to the
Adviser and attached as exhibits hereto within fifteen (15) days after becoming
available. Within forty-five (45) days after the end of each calendar year
during the term hereof, the Subadviser shall certify to the Adviser that it has
complied with the requirements of Rule 17j-1 under the Investment Company Act
with regard to its duties hereunder during the prior year and that there has
been no violation of the Subadviser's written Code of Ethics with respect to
the Fund or in respect of any matter or circumstance that is material to the
performance of the Subadviser's duties hereunder or, if such violation has
occurred, that appropriate action was taken in response to such violation.
13. Liability and Indemnification.
(a) Liability. In the absence of wilful misfeasance, bad faith or
negligence on the part of the Subadviser or a breach of its duties
hereunder, the Subadviser shall not be subject to any liability to the
Adviser or the Fund or any of the Fund's shareholders, and, in the absence
of wilful misfeasance, bad faith or negligence on the part of the Adviser
or a breach of its duties hereunder, the Adviser shall not be subject to
any liability to the Subadviser, for any act or omission in the case of, or
connected with, rendering services hereunder or for any losses that may be
sustained in the purchase, holding or sale of Investments; provided,
however, that nothing herein shall relieve the Adviser and the Subadviser
from any of their obligations under applicable law, including, without
limitation, the federal and state securities laws and the CEA.
(b) Indemnification. The Subadviser shall indemnify the Adviser and
the Fund, and their respective officers and directors, for any liability
and expenses, including attorneys' fees, which may be sustained as a result
of the Subadviser's wilful misfeasance, bad faith, negligence, breach of
its duties hereunder or violation of applicable law, including, without
limitation, the U.S.
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federal and state securities laws or the CEA. The Adviser shall indemnify the
Subadviser and its officers and directors, for any liability and expenses,
including attorneys' fees, which may be sustained as a result of the Adviser's
wilful misfeasance, bad faith, negligence, breach of its duties hereunder or
violation of applicable law, including, without limitation, the U.S. federal
and state securities laws or the CEA.
14. Duration and Termination.
(a) Duration. This Agreement shall be submitted for approval by
shareholders of the Fund at the first meeting of shareholders of the Fund
following the effective date of its Registration Statement on Form N-1A
covering the initial offering of shares of the Fund. This Agreement shall
continue in effect for a period of two years from the date hereof, subject
thereafter to being continued in force and effect from year to year if
specifically approved each year by either (i) the Board of Directors of the
Fund, or (ii) by the affirmative vote of a majority of the Fund's outstanding
voting securities. In addition to the foregoing, each renewal of this
Agreement must be approved by the vote of a majority of the Fund's directors
who are not parties to this Agreement or interested persons of any such party,
cast in person at a meeting called for the purpose of voting on such approval.
Prior to voting on the renewal of this Agreement, the Board of Directors of
the Fund may request and evaluate, and the Subadviser shall furnish, such
information as may reasonably be necessary to enable the Fund's Board of
Directors to evaluate the terms of this Agreement.
(b) Termination. Notwithstanding whatever may be provided herein to
the contrary, this Agreement may be terminated at any time, without payment of
any penalty:
(i) By vote of a majority of the Board of Directors of the
Fund, or by vote of a majority of the outstanding voting securities of
the Fund, or by the Adviser, in each case, upon sixty (60) days'
written notice to the Subadviser;
(ii) By the Adviser upon breach by the Subadviser of any
representation or warranty contained in Section 9 hereof, which shall
not have been cured during the notice period, upon twenty (20) days
written notice;
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(iii) By the Adviser immediately upon written notice to the
Subadviser if the Subadviser becomes unable to discharge its duties
and obligations under this Agreement; or
(iv) By the Subadviser upon 180 days written notice to the
Adviser and the Fund.
This Agreement shall not be assigned (as such term is defined in the
Investment Company Act of 1940) without the prior written consent of the
parties hereto. This Agreement shall terminate automatically in the event
of its assignment without such consent or upon the termination of the
Advisory Agreement.
15. Duties of the Adviser. The Adviser shall continue to have
responsibility for all services to be provided to the Fund pursuant to the
Advisory Agreement and shall oversee and review the Subadviser's performance of
its duties under this Agreement. Nothing contained in this Agreement shall
obligate the Adviser to provide any funding or other support for the purpose of
directly or indirectly promoting investments in the Fund.
16. Amendment. This Agreement may be amended by mutual consent of the
parties, provided that the terms of each such amendment shall be approved by the
Board of Directors of the Fund or by a vote of a majority of the outstanding
voting securities of the Fund. If such amendment is proposed in order to comply
with the recommendations or requirements of the Commission or state regulatory
bodies or other governmental authority, or to expressly obtain any advantage
under federal or state or non-U.S. laws, the Adviser shall notify the Subadviser
of the form of amendment which it deems necessary or advisable and the reasons
therefor, and if the Subadviser declines to assent to such amendment, the
Adviser may terminate this Agreement forthwith.
17. Confidentiality. Subject to the duties of the Adviser, the Fund and the
Subadviser to comply with applicable law, including any demand of any regulatory
or taxing authority having jurisdiction, the parties hereto shall treat as
confidential all information pertaining to the Fund and the actions of the
Subadviser, the Adviser and the Fund in respect thereof.
18. Notice. Any notice that is required to be given by the parties to each
other under the terms of this Agreement shall be in writing, delivered, or
mailed postpaid to the other
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party, or transmitted by facsimile with acknowledgment of receipt, to the
parties at the following addresses or facsimile numbers, which may from time to
time be changed by the parties by notice to the other party:
(a) If to the Adviser:
Strong/Corneliuson Capital Management, Inc.
000 Xxxxxxxx Xxxxxxx
Xxxxxxxxx Xxxxx, Xxxxxxxxx 00000
Attention: Xx. Xxxxx Xxxxx Xxx
Facsimile: (000) 000-0000
(b) If to the Subadviser:
X.X. Xxxxxx & Co., Inc.
00 Xxxxxxxxxx Xxxxxx
Xxxxxx Xxxx, X.X. 00000
Attention: Xx. Xxxxx X. Xxxx
Facsimile: (000) 000-0000
(c) If to the Fund:
Strong American Utilities Fund, Inc.
000 Xxxxxxxx Xxxxxxx
Xxxxxxxxx Xxxxx, Xxxxxxxxx 00000
Attention: Xx. Xxxxx Xxxxx Xxx
Facsimile: (000) 000-0000
19. Governing Law; Jurisdiction. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of Wisconsin and
the Subadviser consents to the exclusive jurisdiction of courts, both federal
and state, and venue in Wisconsin, with respect to any dispute arising under or
in connection with this Agreement.
20. Counterparts. This Agreement may be executed in one or more
counterparts, all of which shall together constitute one and the same
instrument.
21. Captions. The captions herein are included for convenience of
reference only and shall be ignored in the construction or interpretation
hereof.
22. Severability. If any provision of this Agreement shall be held or
made invalid by a court decision or applicable law, the remainder of the
Agreement shall not be affected adversely and shall remain in full force and
effect.
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23. Certain Definitions.
(a) "business day." As used herein, business day means any
customary business day in the United States on which the New York Stock
Exchange is open.
(d) Miscellaneous. Any question of interpretation of any term or
provision of this Agreement having a counterpart in or otherwise derived from a
term or provision of the Investment Company Act shall be resolved by reference
to such term or provision of the Investment Company Act and to interpretations
thereof, if any, by the U.S. courts or, in the absence of any controlling
decisions of any such court, by rules, regulation or order of the Commission
validly issued pursuant to the Investment Company Act. Specifically, as used
herein, "investment company," "affiliated person," "interested person,"
"assignment," "broker," "dealer" and "affirmative vote of the majority of the
Fund's outstanding voting securities" shall all have such meaning as such terms
have in the Investment Company Act. The term "investment adviser" shall have
such meaning as such term has in the Investment Advisers Act and the Investment
Company Act, and in the event of a conflict between such Acts, the most
expansive definition shall control. In addition, where the effect of a
requirement of the Investment Company Act reflected in any provision of this
Agreement is relaxed by a rule, regulation or order of the Commission, whether
of special or general application, such provision shall be deemed to
incorporate the effect of such rule, regulation or order.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the day and year first written above.
STRONG/CORNELIUSON CAPITAL
MANAGEMENT, INC. (the "Adviser")
By: /s/ XXXXXX X. XXXXXXX
-----------------------------
Xxxxxx X. Xxxxxxx
President
Attest: /s/ XXXXX XXXXX XXX
--------------------------
Xxxxx Xxxxx Xxx
Senior Vice President
and Secretary
X.X. XXXXXX & CO., INC.
(the "Subadviser")
By: /s/ XXXXXX X. XXXXXXXX
-----------------------------
Xxxxxx X. Xxxxxxxx
Executive Vice President
Attest: /s/ XXXXX X. XXXX
--------------------------
Xxxxx X. Xxxx
Vice President
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