EXHIBIT 5(e)
FORM OF SUB-ADVISORY AGREEMENT
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Agreement made as of ___________, 1996 ("Agreement") between XXXXXXXX
XXXXXXXX ASSET MANAGEMENT INC., a Delaware corporation ("Xxxxxxxx Xxxxxxxx"),
and XXXXXXXX CAPITAL MANAGEMENT INTERNATIONAL INC., a New York corporation
("Sub-Adviser"), (the "Agreement").
RECITALS
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(1) Xxxxxxxx Xxxxxxxx has entered into a Investment Advisory and
Administration Contract, dated April 21, 1988, including an addendum dated
________________, 1996 ("Advisory Contract"), with PaineWebber Managed
Investments Trust ("Trust"), an open-end management investment company
registered under the Investment Company Act of 1940, as amended ("1940 Act");
(2) The Trust offers for public sale distinct series of shares of beneficial
interest and may offer additional distinct series in the future;
(3) Under the Advisory Contract Xxxxxxxx Xxxxxxxx has agreed to provide
certain investment advisory and administrative services to each series of the
Fund as now exists and as hereafter may be established;
(4) The Advisory Contract permits Xxxxxxxx Xxxxxxxx to delegate certain of
its duties as investment adviser under the Advisory Contract to a sub-adviser;
and
(5) Xxxxxxxx Xxxxxxxx desires to retain the Sub-Adviser to furnish certain
investment advisory services with respect to the PaineWebber Asia Pacific Growth
Fund ("Fund") series of the Trust, and the Sub-Adviser is willing to furnish
such services;
NOW, THEREFORE, in consideration of the premises and mutual covenants herein
contained, the parties agree as follows:
1. Appointment. Xxxxxxxx Xxxxxxxx hereby appoints the Sub-Adviser as an
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investment sub-adviser with respect to the Fund 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.
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(a) Subject to the supervision of and any guidelines adopted by the Trust's
Board of Trustees (the "Board") and Xxxxxxxx
Xxxxxxxx, the Sub-Adviser will provide a continuous investment program for the
Fund, including investment research and management. The Sub-Adviser will
determine from time to time what investments will be purchased, retained or sold
by the Fund. The Sub-Adviser will be responsible for placing purchase and sell
orders for investments and for other related transactions. The Sub-Adviser will
provide services under this Agreement in accordance with the Fund's investment
objective, policies and restrictions as stated in the Trust's Registration
Statement.
(b) The Sub-Adviser agrees that, in placing orders with brokers, it will
obtain the best net result in terms of price and execution; provided that, on
behalf of the Fund, the Sub-Adviser may, in its discretion, use brokers who
provide the Sub-Adviser with research, analysis, advice and similar services to
execute portfolio transactions, 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 determining 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 Fund and its other
clients and that the total commissions paid by the Fund will be reasonable in
relation to the benefits to the Fund over the long term. In no instance will
portfolio securities be purchased from or sold to the Sub-Adviser, 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 Fund 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 Fund 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. Xxxxxxxx Xxxxxxxx recognizes that in some cases this procedure may
adversely affect the results obtained for the Fund.
(c) The Sub-Adviser will maintain all books and records required to be
maintained by the Sub-Adviser pursuant to the 1940 Act and the rules and
regulations promulgated thereunder with respect to transactions by the Sub-
Adviser on behalf of the Fund, and will furnish the Board and Xxxxxxxx Xxxxxxxx
with such periodic and special reports as the Board or Xxxxxxxx Xxxxxxxx
reasonably may request. In compliance with the requirements of Rule 31a-3 under
the 1940 Act, the Sub-Adviser hereby agrees that all records which it maintains
for the Fund are the property of the Trust, agrees to preserve for the periods
prescribed by Rule 31a-2 under the 1940 Act any records which it maintains for
the Trust and which are required to be maintained by Rule 31a-1 under the 1940
Act, and further agrees to surrender promptly to the Trust any records which it
maintains for the Fund upon request by the Trust.
(d) At such times as shall be reasonably requested by the Board or Xxxxxxxx
Xxxxxxxx, the Sub-Adviser will provide the Board and Xxxxxxxx Xxxxxxxx with
economic and investment analyses and reports as well as quarterly reports
setting forth the Fund's performance and make available to the Board and
Xxxxxxxx Xxxxxxxx any economic, statistical and investment services normally
available to institutional or other customers of the Sub-Adviser.
(e) In accordance with procedures adopted by the Board, as amended from time
to time, the Sub-Adviser is responsible for assisting in the fair valuation of
all portfolio securities and will use its reasonable efforts to arrange for the
provision of a price(s) from a party(ies) 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.
3. Further Duties. In all matters relating to the performance of this
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Agreement, the Sub-Adviser will act in conformity with the Trust's Declaration
of Trust, By-Laws and currently effective registration statement under the 1940
Act, and any amendments or supplements thereto ("Registration Statement"), and
with the written instructions and written directions of the Board and Xxxxxxxx
Xxxxxxxx, and will comply with the requirements of the 1940 Act, the Investment
Advisers Act of 1940, as amended ("Advisers Act"), the rules under each,
Subchapter M of the Internal Revenue Code ("Code"), as applicable to regulated
investment companies, the diversification requirements applicable to the Fund
under Section 817(h) of the Code, and all other applicable federal and state
laws and regulations. Xxxxxxxx Xxxxxxxx agrees to provide to the Sub-Adviser
copies of the Trust's Declaration of Trust, By-Laws, Registration Statement,
written instructions and directions of the Board and Xxxxxxxx Xxxxxxxx, and any
amendments or supplements to any of these materials as soon as practicable after
such materials become available; [provided, however, that the Sub-Adviser's duty
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under this Agreement to act in conformity with any document, instruction, or
guidelines produced by the Trust or Xxxxxxxx Xxxxxxxx shall not arise until it
has been delivered to the Sub-Adviser.] Any changes to the Fund's objectives,
policies or restrictions will make due allowance for the time within which the
Sub-Adviser shall have to come into compliance.
4. Expenses. During the term of this Agreement, the Sub-Adviser will bear
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all expenses incurred by it in connection with its services under this
Agreement. The Sub-Adviser shall not be responsible for any expenses incurred
by the Trust, the Fund or Xxxxxxxx Xxxxxxxx.
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5. Compensation.
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(a) For the services provided and the expenses assumed by the Sub-Adviser
pursuant to this Agreement, Xxxxxxxx Xxxxxxxx, not the Fund, will pay to the
Sub-Adviser a fee, computed daily and payable monthly, at an annual rate of
____% of the Fund's average daily net assets (computed in the manner specified
in the Advisory Contract), and will provide the Sub-Adviser with a schedule
showing the manner in which the fee was computed.
(b) The fee shall be computed 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 Xxxxxxxx Xxxxxxxx has agreed to waive all or a
portion of its management fee (on a voluntary basis or to comply with any
expense limitation imposed by a state), the Sub-Adviser will waive the
proportion of its fees that will amount to half of Xxxxxxxx Xxxxxxxx' total fee
waiver.
(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 prorated according to the proportion which such period bears to the
full month in which such effectiveness or termination occurs.
6. Limitation Of Liability. The Sub-Adviser shall not be liable for any
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error of judgment or mistake of law or for any loss suffered by the Fund, the
Trust or its shareholders or by Xxxxxxxx Xxxxxxxx in connection with the matters
to which this Agreement relates, except a loss resulting from willful
misfeasance, bad faith or gross negligence on its part in the performance of its
duties or from reckless disregard by it of its obligations and duties under this
Agreement.
7. Representations of Sub-Adviser. The Sub-Adviser represents, warrants and
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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 Xxxxxxxx Xxxxxxxx of the occurrence of
any event that would disqualify the Sub-Adviser from serving as an
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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 will provide Xxxxxxxx Xxxxxxxx
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, the president or a vice-president of the
Sub-Adviser shall certify to Xxxxxxxx Xxxxxxxx that the Sub-Adviser has complied
with the requirements of Rule 17j-1 during the previous year and that there has
been no 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 Xxxxxxxx Xxxxxxxx, the Sub-Adviser shall permit
Xxxxxxxx Xxxxxxxx, its employees or its agents to examine the reports required
to be made to the Sub-Adviser by Rule 17j-1(c)(1) and all other records relevant
to the Sub-Adviser's code of ethics.
(c) The Sub-Adviser has provided Xxxxxxxx Xxxxxxxx with a copy of its Form
ADV as most recently filed with the Securities and Exchange Commission ("SEC")
and promptly will furnish a copy of all amendments to Xxxxxxxx Xxxxxxxx at least
annually.
(d) The Sub-Adviser will notify Xxxxxxxx Xxxxxxxx of any change of control of
the Sub-Adviser, including any change of its general partners or 25%
shareholders, as applicable, and any changes in the key personnel who are either
the portfolio manager(s) of the Fund or senior management of the Sub-Adviser, in
each case prior to or promptly after such change.
8. Services Not Exclusive. The Sub-Adviser may act as an investment adviser
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to any other person, firm or corporation, and may perform management and any
other services for any other person, association, corporation, firm or other
entity pursuant to any contract or otherwise, and take any action or do anything
in connection therewith or related thereto, except as prohibited by applicable
law; and no such performance of management or other services or taking of any
such action or doing of any such thing shall be in any manner restricted or
otherwise affected by any aspect of any relationship of the Sub-Adviser to or
with the Trust, Fund or Xxxxxxxx Xxxxxxxx or deemed to violate or give rise to
any duty or obligation of the Sub-Adviser to the Trust, Fund or Xxxxxxxx
Xxxxxxxx except as otherwise imposed by law or by this Agreement.
9. Duration and Termination.
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(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
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those trustees of the Trust 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, and (ii) by vote of a majority of the Fund'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 those trustees of the Trust 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, and
(ii) by the Board or by vote of a majority of the outstanding voting securities
of the Fund.
(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 Fund on 60 days' written
notice to the Sub-Adviser. This Agreement may also be terminated, without the
payment of any penalty, by Xxxxxxxx Xxxxxxxx: (i) upon 120 days' written notice
to the Sub-Adviser; (ii) immediately upon material breach by the Sub-Adviser of
any of the representations and warranties set forth in Paragraph 7 of this
Agreement; or (iii) immediately if, in the reasonable judgment of Xxxxxxxx
Xxxxxxxx, 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 Fund.
The Sub-Adviser may terminate this Agreement at any time, without the payment of
any penalty, on 120 days' written notice to Xxxxxxxx Xxxxxxxx. This Agreement
will terminate automatically in the event of its assignment or upon termination
of the Advisory Contract as it relates to the Fund.
10. Amendment of this Agreement. No provision of this Agreement may be
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changed, waived, discharged or terminated orally, but only by an instrument in
writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought. No amendment of this Agreement shall be
effective until 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, and (ii) by a vote of a majority of the Fund's outstanding voting
securities (unless in the case of (ii), the Trust receives an SEC order or no-
action letter permitting it to modify the Agreement without such vote).
11. Governing Law. This Agreement shall be construed in accordance with
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the 1940 Act and the laws of the State of Delaware, without giving effect to the
conflicts of laws principles thereof.
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To the extent that the applicable laws of the State of Delaware conflict with
the applicable provisions of the 1940 Act, the latter shall control.
12. Miscellaneous. The captions in this Agreement are included for
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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
meaning 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.
13. Notices. Any written notice herein required to be given to the Sub-
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Adviser or Xxxxxxxx Xxxxxxxx shall be deemed to have been given upon receipt of
the same at their respective addresses set forth below.
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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.
XXXXXXXX XXXXXXXX ASSET MANAGEMENT INC.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attest:
By:_____________________ By:_____________________________
Name: Name: XXXXXX X. X'XXXXXXX
Title: Title: Senior Vice President
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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.
XXXXXXXX CAPITAL MANAGEMENT
INTERNATIONAL INC.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attest:
By:_______________________ By:_____________________________
Name: Name:
Title: Title:
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