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EXHIBIT 5(b)(1)
AIM EQUITY FUNDS, INC
(AIM Charter Fund)
(AIM Constellation Fund)
(AIM Xxxxxxxxxx Fund)
MASTER SUB-ADVISORY AGREEMENT
THIS AGREEMENT is made as of this 18th day of October, 1993, by and
between A I M Advisors, Inc., a Delaware corporation (the "Advisor') and A I M
Capital Management Inc., a Texas corporation (the "Sub-Advisor").
RECITALS
WHEREAS, AIM Equity Funds, Inc. (the "Company") is registered under the
Investment Company Act of 1940, as amended (the "1940 Act") as an open-end,
diversified management investment company, consisting of multiple series of
investment portfolios;
WHEREAS, the Advisor is registered under the Investment Advisers Act of
1940 (the "Advisers Act"), as amended, as an investment advisor and engages in
the business of acting as an investment advisor,
WHEREAS, the Sub-Advisor is registered under the Advisers Act, as amended,
as an investment advisor and engages in the business of acting as an investment
advisor;
WHEREAS, the Company's charter authorizes the Board of Directors of the
Company to classify or reclassify authorized but unissued shares of the
Company, and as of the date of this Agreement, the Company's Board of Directors
has authorized the issuance of four series of shares representing interests in
four investment portfolios: AIM Aggressive Growth Fund, AIM Charter Fund, AIM
Constellation Fund and AIM Xxxxxxxxxx Fund (collectively referred to herein as
the "Portfolios");
WHEREAS, the Advisor has entered into a Master Investment Advisory
Agreement of even date herewith with the Company (the "Investment Advisory
Agreement"), pursuant to which the Advisor shall act as investment advisor with
respect to the Portfolios; and
WHEREAS, pursuant to Section 3 ("Delegation of Responsibilities") of the
Investment Advisory Agreement, the Advisor wishes to retain the Sub-Advisor for
purposes of rendering advisory services to the Advisor in connection with the
AIM Constellation Fund, AIM Xxxxxxxxxx Fund, and AIM Charter Fund (the
"Funds"), upon the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the mutual covenants herein contained
and other good and valuable consideration, the receipt whereof is hereby
acknowledged, the parties hereto agree as follows:
1. Appointment of Sub-Advisor. The Advisor hereby appoints the
Sub-Advisor to render investment research and advisory services to the Advisor
with respect to the Funds, under the supervision of the Advisor and subject to
the approval and direction of the Company's Board of Directors, and the
Sub-Advisor hereby accepts such appointment all subject to the terms and
conditions contained herein.
2. Investment Analysis. The duties of the Sub-Advisor shall include:
(a) obtaining and evaluating pertinent information about
significant developments and economic, statistical and financial data,
domestic, foreign or otherwise, whether affecting the economy
generally or the Funds, and whether concerning the individual issuers
whose securities are included in the Funds or the activities in which
such issuers engage, or with respect to securities which the
Sub-Advisor considers desirable for inclusion in the Funds' investment
portfolios;
(b) determining which issuers and securities shall be
represented in the Funds' investment portfolios and regularly
reporting thereon to the Advisor and, at the request of the Advisor,
to the Company's Board of Directors; and
(c) formulating and implementing continuing programs for
the purchases and sales of the securities of such issuers and
regularly reporting thereon to the Advisor and, at the request of the
Advisor, to the Company's Board of Directors.
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3. Control by Board of Directors. Any investment program
undertaken by the Sub-Advisor pursuant to this Agreement, as well as any other
activities undertaken by the Sub-Advisor with respect to the Funds, shall at
all times be subject to any directives of the Board of Directors of the
Company.
4. Compliance with Applicable Requirements. In carrying out its
obligations under this Agreement, the Sub-Advisor shall at all times conform to:
(a) all applicable provisions of the 1940 Act and the
Advisers Act and any rules and regulations adopted thereunder;
(b) the provisions of the registration statement of the
Company, as the same may be amended from time to time, under the
Securities Act of 1933 and the 1940 Act;
(c) the provisions of the corporate charter of the
Company, as the same may be amended from time to time;
(d) the provisions of the by-laws of the Company, as the
same may be amended from time to time; and
(e) any other applicable provisions of state or federal
law.
5. Compensation. The Advisor shall pay to the Sub-Advisor, as
compensation for services rendered hereunder, an annual fee, payable monthly,
equal to 50% of the fee received by the Advisor from the Company with respect
to the Funds pursuant to the Investment Advisory Agreement
6. Expenses of the Funds. All of the ordinary business expenses
incurred in the operations of the Funds and the offering of its shares shall be
borne by the Funds unless specifically provided otherwise in this Agreement.
These expenses borne by the Funds include but are not limited to brokerage
commissions, taxes, legal, auditing, or governmental fees, the cost of
preparing share certificates, custodian, transfer and shareholder service agent
costs, expenses of issue, sale, redemption and repurchase of shares, expenses
of registering and qualifying shares for sale, expenses relating to directors
and shareholder meetings, the cost of preparing and distributing reports and
notices to shareholders, the fees and other expenses incurred by the Company on
behalf of the Funds in connection with membership in investment company
organizations and the cost of printing copies of the prospectuses and
statements of additional information distributed to the Funds' shareholders.
7. Non-Exclusivity. The services of the Sub-Advisor to the
Advisor with respect to the Company and the Funds are not deemed to be
exclusive, and the Sub-Advisor shall be free to render investment advisory and
administrative or other services to others (including other investment
companies) and to engage in other activities. It is understood and agreed that
officers and directors of the Sub-Advisor may serve as officers or directors of
the Advisor or of the Company, and that officers or directors of the Advisor or
of the Company may serve as officers or directors of the Sub-Advisor to the
extent permitted by law; and that the officers and directors of the
Sub-Advisor are not prohibited from engaging in any other business activity or
from rendering services to any other person, or from serving as partners,
officers, directors or trustees of any other firm or trust, including
other investment advisory companies.
8. Term and Approval This Agreement shall become effective if
approved by the shareholders of the Funds, and if so approved, this Agreement
shall thereafter continue in force and effect until June 30, 1994, and may be
continued from year to year thereafter, provided that the continuation of the
Agreement is specifically approved at least annually:
(a) (i) by the Company's Board of Directors or (ii) by
the vote of "a majority of the outstanding voting securities" of the
Funds (as defined under Section 2(a)(42) of the 0000 Xxx); and
(b) by the affirmative vote of a majority of the
directors who are not parties to this Agreement or "interested
persons" (as defined in the 0000 Xxx) of a party to this Agreement
(other than as Company directors), by votes cast in person at a
meeting specifically called for such purpose.
9. Termination. This Agreement may be terminated as to the Funds
at any time, without the payment of any penalty, by vote of the Company's Board
of Directors or by vote of a majority of the Funds' outstanding voting
securities, or by the Advisor, or by the Sub-Advisor on sixty (60) days'
written notice to the other party and to the Company. The notice provided for
herein may be waived by either party. This Agreement shall automatically
terminate in the event of its assignment, the term "assignment" for purposes of
this paragraph having the meaning defined in Section 2 (a) (4) of the 1940 Act.
10. Liability of Sub-Advisor and Indemnification. In the absence
of willful misfeasance, bad faith, gross negligence or reckless disregard of
obligations or duties hereunder on the part of the Sub-Advisor or any of its
officers, directors or employees, the Sub-Advisor shall not be subject to
liability to the Advisor for any act or
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omission in the course of, or connected with, rendering services hereunder or
for any losses that may be sustained in the purchase, holding or sale of any
security.
11. Notices. Any notices under this Agreement shall be in
writing, addressed and delivered or mailed postage paid to such address as may
be designated for the receipt of such notice, with a copy to the Company.
Until further notice, it is agreed that the address of the Company, that of the
Advisor and that of the Sub-Advisor shall be 00 Xxxxxxxx Xxxxx, Xxxxx 0000,
Xxxxxxx, Xxxxx 00000.
12. Questions of Interpretation; Applicable Law. 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 1940 Act or the
Advisers Act shall be resolved by reference to such term or provision of the
1940 Act or the Advisers Act and to interpretations thereof, if any, by the
United States Courts or in the absence of any controlling decision of any such
court, by rules, regulations or orders of the Securities and Exchange
Commission issued pursuant to said Acts. In addition, where the effect of a
requirement of the 1940 Act or the Advisers Act reflected in any provision of
this Agreement is revised by rule, regulation or order of the Securities and
Exchange Commission, such provision shall be deemed to incorporate the effect
of such rule, regulation or order.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in duplicate by their respective duly authorized officers as of the
day and year first written above.
Attest: A I M ADVISORS, INC.
/s/ XXXXX X. XXXXXX BY: /s/ XXXXXX X. XXXXXX
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Assistant Secretary President
(SEAL) A I M CAPITAL MANAGEMENT, INC.
Attest:
/s/ XXXXX X. XXXXXX BY: /s/ XXXX X. XXXX
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Assistant Secretary President
(SEAL)
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