EXHIBIT 99.5(a)
FORM OF SUB-ADVISORY AGREEMENT
Agreement made as of the th day of January, 1997, by and between
Fund Asset Management, l.p., a Delaware limited partnership (hereinafter
referred to as "FAM"), and Xxxxxxx Xxxxx Asset Management U.K. Limited, a
corporation organized under the laws of England and Wales (hereinafter
referred to as "MLAM U.K.").
Witnesseth:
Whereas, The Corporate Fund Accumulation Program, Inc. (the "Fund") is a
Maryland corporation engaged in business as a non-diversified, open-end
investment company registered under the Investment Company Act of 1940, as
amended (hereinafter referred to as the "Investment Company Act"); and
Whereas, FAM and MLAM U.K. are engaged principally in rendering
investment advisory services and are registered as investment advisers under
the Investment Advisers Act of 1940, as amended; and
Whereas, MLAM U.K. is a member of the Investment Management Regulatory
Organization, a self-regulating organization recognized under the Financial
Services Act of 1986 of the United Kingdom (hereinafter referred to as
"IMRO"), and the conduct of its investment business is regulated by IMRO; and
Whereas, FAM has entered into a management agreement (the "Management
Agreement") dated , pursuant to which FAM provides management and
investment and advisory services to the Fund; and
Whereas, MLAM U.K. is willing to provide investment advisory services to
FAM in connection with the Fund's operations on the terms and conditions
hereinafter set forth;
Now, Therefore, in consideration of the premises and the covenants
hereinafter contained, MLAM U.K. and FAM hereby agree as follows:
ARTICLE I
Duties of MLAM U.K.
FAM hereby employs MLAM U.K. to act as investment adviser to FAM and to
furnish, or arrange for affiliates to furnish, the investment advisory
services described below, subject to the broad supervision of FAM and the
Fund, for the period and on the terms and conditions set forth in this
Agreement. MLAM U.K. hereby accepts such employment and agrees during such
period, at its own expense, to render, or arrange for the rendering of, such
services and to assume the obligations herein set forth for the compensation
provided for herein. FAM and its affiliates shall for all purposes herein be
deemed a Professional Investor as defined under the rules promulgated by IMRO
(hereinafter referred to as the "IMRO Rules"). MLAM U.K. and its affiliates
shall for all purposes herein be deemed to be an independent contractor and
shall, unless otherwise expressly provided or authorized, have no authority
to act for or represent the Fund in any way or otherwise be deemed an agent
of the Fund.
MLAM U.K. shall have the right to make unsolicited calls on FAM and
shall provide FAM with such investment research, advice and supervision as
the latter may from time to time consider necessary for the proper
supervision of the assets of the Fund; shall furnish continuously an
investment program for the Fund and shall make recommendations from time to
time as to which securities shall be purchased, sold or exchanged and what
portion of the assets of the Fund shall be held in the various securities in
which the Fund invests, options, futures, options on futures or cash; all of
the foregoing subject always to the restrictions of the Articles of
Incorporation and By-Laws of the Fund, as they may be amended and/or restated
from time to time, the provisions of the Investment Company Act and the
statements relating to the Fund's
investment objective, investment policies and investment restrictions as the
same are set forth in the currently effective prospectus and statement of
additional information relating to the shares of the Fund under the
Securities Act of 1933, as amended (the "Prospectus" and "Statement of
Additional Information", respectively). MLAM U.K. shall make recommendations
and effect transactions with respect to foreign currency matters, including
foreign exchange contracts, foreign currency options, foreign currency
futures and related options on foreign currency futures and forward foreign
currency transactions. MLAM U.K. shall also make recommendations or take
action as to the manner in which voting rights, rights to consent to
corporate action and any other rights pertaining to the portfolio securities
of the Fund shall be exercised.
MLAM U.K. will not hold money on behalf of FAM or the Fund, nor will
MLAM U.K. be the registered holder of the registered investments of FAM or
the Fund or be the custodian of documents or other evidence of title.
ARTICLE II
Allocation of Charges and Expenses
MLAM U.K. assumes and shall pay for maintaining the staff and personnel
necessary to perform its obligations under this Agreement and shall at its
own expense provide the office space, equipment and facilities which it is
obligated to provide under Article I hereof and shall pay all compensation of
officers of the Fund and all Directors of the Fund who are affiliated persons
of MLAM U.K.
ARTICLE III
Compensation of MLAM U.K.
For the services rendered, the facilities furnished and expenses assumed
by MLAM U.K., FAM shall pay to MLAM U.K. a fee in an amount to be determined
from time to time by FAM and MLAM U.K. but in no event in excess of the
amount that FAM actually receives for providing services to the Fund pursuant
to the Management Agreement.
ARTICLE IV
Limitation of Liability of MLAM U.K.
MLAM U.K. shall not be liable for any error of judgment or mistake of
law or for any loss arising out of any investment or for any act or omission
in the performance of sub-advisory services rendered with respect to the
Fund, except for willful misfeasance, bad faith or gross negligence in the
performance of its duties, or by reason of reckless disregard of its
obligations and duties hereunder. As used in this Article IV, MLAM U.K.
shall include any affiliates of MLAM U.K. performing services for FAM
contemplated hereby and directors, officers and employees of MLAM U.K. and
such affiliates.
ARTICLE V
Activities of MLAM U.K.
The services of MLAM U.K. to the Fund are not to be deemed to be
exclusive, MLAM U.K. and any person controlled by or under common control
with MLAM U.K. (for purposes of this Article V referred to as "affiliates")
being free to render services to others. It is understood that Directors,
officers, employees and shareholders of the Fund are or may become interested
in MLAM U.K. and its affiliates, as directors, officers, employees and
shareholders or otherwise and that directors, officers, employees and
shareholders of MLAM U.K. and its affiliates are or may become similarly
interested in the Fund, and that MLAM U.K. and directors, officers,
employees, partners and shareholders of its affiliates may become interested
in the Fund as shareholders or otherwise.
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ARTICLE VI
MLAM U.K. Statements Pursuant to IMRO Rules
Any complaints concerning MLAM U.K. should be in writing addressed to
the attention of the Managing Director of MLAM U.K. FAM has the right to
obtain from MLAM U.K. a copy of the IMRO complaints procedure and to approach
IMRO directly.
MLAM U.K. may make recommendations, subject to the investment
restrictions referred to in Article I herein, regarding Investments Not
Readily Realisable (as that term is used in the IMRO Rules) or investments
denominated in a currency other than British pound sterling. There can be no
certainty that market makers will be prepared to deal in unlisted or thinly
traded securities and an accurate valuation may be hard to obtain. The value
of investments recommended by MLAM U.K. may be subject to exchange rate
fluctuations which may have favorable or unfavorable effects on investments.
MLAM U.K. may make recommendations, subject to the investment
restrictions referred to in Article I herein, regarding options, futures of
contracts for differences. Markets can be highly volatile and such
investments carry a high degree of risk of loss exceeding the original
investment and any margin on deposit.
ARTICLE VII
Duration and Termination of this Agreement
This Agreement shall become effective as of the date first above written
and shall remain in force until the date of termination of the Management
Agreement (but not later than two years after the date hereof) and
thereafter, but only so long as such continuance is specifically approved at
least annually by (i) the Directors of the Fund or by the vote of a majority
of the outstanding voting securities of the Fund and (ii) a majority of those
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.
This Agreement may be terminated at any time, without the payment of any
penalty, by XXX or by vote of a majority of the outstanding voting securities
of the Fund, or by MLAM U.K., on sixty days' written notice to the other
party. This Agreement shall automatically terminate in the event of its
assignment or in the event of the termination of the Management Agreement.
Any termination shall be without prejudice to the completion of transactions
already initiated.
ARTICLE VIII
Amendments of this Agreement
This Agreement may be amended by the parties only if such amendment is
specifically approved by (i) the Directors of the Fund or by the vote of a
majority of outstanding voting securities of the Fund and (ii) a majority of
those Directors who are not parties to this Agreement of interested persons
of any such party cast in person at a meeting called for the purpose of
voting on such approval.
ARTICLE IX
Definitions of Certain Terms
The terms "vote of a majority of the outstanding voting securities",
"assignment", "affiliated person" and "interested person", when used in this
Agreement, shall have the respective meaning specified in the Investment
Company Act and the rules and regulations thereunder, subject, however, to
such exemptions as may be granted by the Securities and Exchange Commission
under said Act.
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ARTICLE X
Governing Law
This Agreement shall be construed in accordance with the laws of the
State of New York and the applicable provisions of the Investment Company
Act. To the extent that the applicable laws of the State of New York, or any
of the provisions herein, conflict with the applicable provisions of the
Investment Company Act, the latter shall control.
In Witness Whereof, the parties hereto have executed and delivered this
Agreement as of the date first above written.
Fund Asset Management, L.P.
By
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Title
Xxxxxxx Xxxxx Asset Management U.K.
Limited
By
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Title
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