FORM OF INVESTMENT SUBADVISORY AGREEMENT
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THIS AGREEMENT, made this _____ day of __________, 199___, is between
CHUBB INVESTMENT ADVISORY CORPORATION, a Tennessee corporation with offices at
Xxx Xxxxxxx Xxxxx, Xxxxxxx, Xxx Xxxxxxxxx, 00000 (the "Investment Manager" or
"Manager") and Warburg, Xxxxxx Counselors, Inc., ("Subadviser") a Delaware
corporation with offices at 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
WITNESSETH:
WHEREAS, Chubb America Fund, Inc. (the "Fund") is engaged in business
as a diversified open-end management investment company and is registered as
such under the Investment Company Act of 1940 (the "Investment Company Act");
WHEREAS, the Fund issues separate classes or series of stock, each of
which represents a separate portfolio of investments;
WHEREAS, the Fund's shareholders are and will be separate accounts
maintained by insurance companies for variable life insurance policies under
which income, gains, losses, whether or not realized, from assets allocated to
such accounts are, in accordance with the Policies, credited to or charged
against such accounts without regard to other income, gains, or losses of such
insurance companies;
WHEREAS, the Fund has employed the Investment Manager to act as
investment manager of the Portfolio, as set forth in an Investment Management
Agreement between the Fund and the Investment Manager dated _______, 199__, (the
"Investment Management Agreement") pursuant to which it was agreed that the
Investment Manager may contract with the Subadviser, or other parties for
certain investment management services;
WHEREAS, the Subadviser is engaged in the business of rendering
investment advisory services and is registered as an investment adviser under
the Investment Advisers Act of 1940;
WHEREAS, the Investment Manager desires to retain the Subadviser to
render investment management services to the Fund's Growth and Income Portfolio
(the "Portfolio") in the manner and on the terms hereinafter set forth;
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NOW, THEREFORE, in consideration of the premises and the convenants
hereinafter contained the Investment Manager and the Subadviser hereby agree as
follows:
1. Appointment of the Subadviser. The Investment Manager hereby
appoints the Subadviser to act as an investment subadviser for the Portfolio and
to manage the investment and reinvestment of the assets of the Portfolio,
subject to the supervision of the Directors of the Fund and the terms and
conditions of this Agreement. The Subadviser will be an independent contractor
and will have no authority to act for or represent the Fund or Investment
Manager in any way or otherwise be deemed an agent of the Fund or Investment
Manager except as expressly authorized in this Agreement or another writing by
the Fund, Investment Manager and the Subadviser. Notwithstanding the
foregoing, the Subadviser may execute account documentation, agreements,
contracts and other documents as the Subadviser may be requested by brokers,
dealers, counterparts and other persons in connection with the Subadviser's
management of the assets of the Portfolio, provided that the Subadviser receives
the express agreement and consent of the Investment Manager and/or the Fund's
Board of Directors to execute such documentation, agreements, contracts and
other documents. In such respect, and only for this limited purpose, the
Subadviser shall act as the Investment Manager and/or the Fund's agent and
attorney-in-fact.
2. Duties of the Subadviser. The Subadviser hereby agrees, subject
to the supervision of the Investment Manager and the Board of Directors of the
Fund, (1) to act as the Subadviser of the Portfolio, (2) to manage the
investment and reinvestment of the assets of the Portfolio for the period and on
the terms and conditions set forth in this Agreement, and (3) during the term
hereof, to render the services and to assume the obligations herein set forth in
return for the compensation provided for herein and to bear all expenses of its
performance of such services and obligations.
3. Services to be Rendered by the Subadviser to the Fund
A. The Subadviser will manage the investment and reinvestment of the
assets of the Portfolio and determine the composition of the assets of the
Portfolio, subject always to the direction and control of the Directors of the
Fund and the Investment Manager and in accordance with the provisions of the
Fund's registration statement, as amended from time to time. In fulfilling its
obligations to manage the investment and reinvestment of the assets of the
Portfolio, the Subadviser will:
(i) obtain and evaluate pertinent economic, statistical,
financial, and other information affecting the economy generally and individual
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companies or industries, the securities of which are included in the Portfolio
or are under consideration for inclusion in the Portfolio;
(ii) formulate and implement a continuous investment program for
the Portfolio (a) consistent with the investment objectives, policies, and
restrictions of the Portfolio as stated in the Fund's Agreement and Articles of
Incorporation, Bylaws, and such Portfolio's currently effective Prospectus and
Statement of Additional Information ("SAI") as amended from time to time, and
(b) in compliance with the requirements applicable to both regulated investment
companies and segregated asset accounts under Subchapters M and L of the
Internal Revenue Code of 1986, as amended, and requirements applicable to
registered investment companies under applicable laws;
(iii) take whatever steps are necessary to implement the
investment program for the Portfolio by the purchase and sale of securities and
other investments authorized under the Fund's Agreement and Articles of
Incorporation, Bylaws, and such Portfolio's currently effective Prospectus and
SAI, including the placing of orders for such purchases and sales;
(iv) regularly report to the Directors of the Fund and the
Investment Manager with respect to the implementation of the investment program
and, in addition, provide such statistical information and special reports
concerning the Portfolio and/or important developments materially affecting the
investments held, or contemplated to be purchased, by the Portfolio, as may
reasonably be requested by the Investment Manager or the Directors of the Fund,
including attendance at Board of Directors Meetings, as reasonably requested, to
present such information and reports to the Board;
(v) Assist in the determination of the fair value of certain
portfolio securities when market quotations are not readily available for the
purpose of calculating the Portfolio's net asset value in accordance with
procedures and methods established by the Directors of the Fund;
(vi) establish appropriate interfaces with the Fund's Investment
Manager in order to provide such Investment Manager with all necessary
information requested by the Manager.
B. To facilitate the Subadviser's fulfillment of its obligations
under this Agreement, the Investment Manager and the Fund will undertake the
following:
(i) the Manager agrees promptly to provide the Subadviser with
all amendments or supplements to the Registration Statement, the Fund's
Agreement and Articles of Incorporation, and Bylaws;
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(ii) the Fund and the Manager each agrees, on an ongoing basis,
to notify the Subadviser expressly in writing of each change in the fundamental
and nonfundamental investment policies of the Portfolio;
(iii) The Manager agrees to provide or cause to be provided to
the Subadviser with such assistance as may be reasonably requested by the
Subadviser in connection with its activities pertaining to the Portfolio under
this Agreement, including, without limitation, information concerning the
Portfolio, its available funds, or funds that may reasonably become available
for investment, and information as to the general condition of the Portfolio's
affairs;
(iv) the Manager agrees to provide or cause to be provided to
the Subadviser on an ongoing basis, such information as is reasonably requested
by the Subadviser for performance by the Subadviser of its obligations under
this Agreement, and the Subadviser shall not be in breach of any term of this
Agreement or be deemed to have acted negligently if the Manager fails to provide
or cause to be provided such requested information and the Subadviser relies on
the information most recently furnished to the Subadviser; and
(v) the Manager will promptly provide the Subadviser with any
guidelines and procedures applicable to the Subadviser or the Portfolio adopted
from time to time by the Board of Directors of the Fund and agrees to promptly
provide the Subadviser copies of all amendments thereto.
C. The Subadviser, at its expense, will furnish: (i) all necessary
investment and management facilities and investment personnel, including
salaries, expenses and fees of any personnel required for it to faithfully
perform its duties under this Agreement; and (ii) administrative facilities,
including bookkeeping, clerical personnel and equipment necessary for the
efficient conduct of the investment affairs of the Portfolio (excluding that
necessary for the determination of net asset value and shareholder accounting
services). The Subadviser shall not be obligated to pay any expenses of or for
the Portfolio not expressly assumed by the Subadviser pursuant to this
Section 3.
D. The Subadviser will select brokers and dealers to effect all
portfolio transactions subject to the conditions set forth herein. The
Subadviser will place all necessary orders with brokers, dealers, or issuers,
and will negotiate brokerage commissions if applicable. The Subadviser is
directed at all times to seek to execute brokerage transactions for the
Portfolio in accordance with such policies or practices as may be established by
the Board of Directors and described in the Fund's currently effective
Prospectus and SAI, as amended from time to time. In placing orders for the
purchase or sale of investments for the Portfolio, in the name of the Portfolio
or its nominees, the Subadviser shall use its best efforts to obtain for the
Portfolio the most favorable price and best
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execution available, considering all of the circumstances, and shall maintain
records adequate to demonstrate compliance with this requirement.
Subject to the appropriate policies and procedures approved by the
Board of Directors, the Subadviser may, to the extent authorized by Section
28(e) of the Securities and Exchange Act of 1934, cause the Portfolio to pay a
broker or dealer that provides brokerage or research services to the Manger, the
Subadviser, or the Portfolio an amount of commissions for effecting a portfolio
transaction in excess of the amount of commission another broker or dealer would
have charged for effecting that transaction if the Subadviser determines, in
good faith, that such amount of commission is reasonable in relationship to the
value of such brokerage or research services provided viewed in terms of that
particular transaction or the Subadviser's overall responsibilities to the
Portfolio or its other advisory clients. To the extent authorized by said
Section 28(e) and the Fund's Board of Directors, 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 such action. In addition, subject to
seeking the most favorable price and best execution available, the Subadviser
may also consider sales of shares of the Fund as a factor in the selection of
brokers and dealers.
E. On occasions when the Subadviser deems the purchase or sale of a
security to be in the best interest of the Portfolio 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 purchased or sold to attempt to obtain a more favorable price or lower
brokerage commissions and efficient execution. In such event, allocation of the
securities so purchased or sold, 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 Portfolio and to its other clients over time. It is recognized that in
some cases this practice may adversely affect the price paid or received by the
Portfolio or the size of the position obtainable for, or disposed of by, the
Portfolio.
F. The Subadviser will maintain all accounts, books and records with
respect to the Portfolio as are required of an investment adviser of a
registered investment company pursuant to the Investment Company Act and
Advisers Act and the rules thereunder.
4. Compensation of the Subadviser. The Investment Manager will pay
the Subadviser, with respect to the Portfolio, the compensation specified in
Appendix A to this Agreement. Payments shall be made to the Subadviser on the
first day of each month; however, this advisory fee will be calculated on the
daily average value of the Portfolio's assets and accrued on a daily basis.
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5. Non-Exclusivity. The Investment Manager agrees that the services
of the Subadviser are not to be deemed exclusive and the Subadviser is free to
act as investment manager to various investment companies and as fiduciary for
other managed accounts. The Subadviser shall, for all purposes herein, be
deemed to be an independent contractor and shall, unless otherwise provided or
authorized, have no authority to act for or represent the Fund or the Investment
Manager in any way or otherwise be deemed an agent of the Fund or Investment
Manager other than in furtherance of its duties and responsibilities as set
forth in this Subadvisory Agreement.
6. Books and Records. The Subadviser agrees that all books and
records which it maintains for the fund are the Fund's property, and, in the
event of termination of this Agreement for any reason, the Subadviser agrees
promptly to return to the Fund, free from any claim or retention of rights by
the Subadviser, all records relating to the Portfolio. The Subadviser also
agrees upon request of the Investment Manager or the Fund, promptly to surrender
the books and records to either party or make the book and records available for
inspection by representatives of regulatory authorities. In connection with its
duties hereunder, the Subadviser further agrees to maintain, prepare and
preserve books and records in accordance with the Investment Company Act and
rules thereunder, including but not limited to, Rule 31a-1 and 31a-2.
The Subadviser will use records or information obtained under this
Agreement only for the purposes contemplated hereby, and will not disclose such
records or information in any manner other than expressly authorized by the
Fund, or if disclosure is expressly required by applicable federal or state
regulatory authorities or by this Agreement. The Subadviser will furnish any
informational reports requested by any state insurance commissioner.
7. Representations and Warranties by the Investment Manager and the
Subadviser. The Investment Manager and the Subadviser each hereby represents
and warrants to the other that:
A. it is registered as an investment adviser under the Advisers Act;
B. it is a corporation duly organized and validly existing under the
laws of its state of incorporation with the power to own and possess its assets
and carry on its business as it is now being conducted;
C. the execution, delivery and performance of this Agreement by such
party are within such party's powers and have been duly authorized by all
necessary action and no action by or in respect of, or filing with, any
governmental body, agency or official is required on the part of such party for
the execution, delivery and performance of this Agreement by such party and such
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execution, delivery and performance by such party do not contravene or
constitute a default under (i) any provision of applicable law, rule or
regulation, (ii) such party's governing instruments and (iii) any material
agreement, judgment, injunction, order, decree or other instrument binding upon
such party; and
D. the Form ADV of such party previously provided to the other party is a true
and complete copy of the form filed with the Securities and Exchange Commissions
(the "SEC") and the information contained therein is accurate and complete in
all material respects.
The Investment Manager acknowledges that it received a copy of the
Subadvisers ADV more than 48 hours prior to the execution of this Agreement.
8. Representations and Warranties on Behalf of the Fund and the
Portfolio. The Investment Manager hereby represents and warrants, on behalf of
the Fund and the Portfolio, that:
A. the Fund is registered as an investment company under the Investment
Company Act and the Portfolio's shares are registered under the Securities Act
of 1933, as amended (the "Securities Act");
B. the Fund, on behalf of the Portfolio, has filed a notice of exemption
pursuant to Rule 4.5 under the Commodity Exchange Act with the Commodity Futures
Trading Commission and the National Futures Association; and
C. The Fund is a Maryland corporation duly organized and validly existing
under the laws of the State of Maryland with the power to own and possess its
assets and carry on its business as it is now being conducted.
9. Survival of Representations and Warranties; Duty to Update
Information. All representations and warranties made pursuant to Sections 7 and
8 of this Agreement shall survive for the duration of this Agreement and each
party hereto shall promptly notify the owner in writing upon becoming aware that
any of the foregoing representations and warranties made by such party are no
longer true.
10. Liability. Neither the Subadviser nor any of its affiliates,
directors, officers, or employees shall be liable to the Investment Manager, the
Fund or any shareholder thereof or any service provider to any Portfolio for any
loss suffered by the Investment Manager, the Fund or any shareholder thereof or
any service provider to any portfolio resulting from its acts or omissions as
Subadviser to the Portfolio, except for losses resulting from willful
misconduct, bad faith or gross negligence in the performance of, or from
reckless disregard of, the duties of the Subadviser or any of its affiliates,
directors, officers or
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employees. The Subadviser, its affiliates, directors, officers or employees
shall not be liable to the Investment Manager or the Fund for any loss suffered
as a consequence of any action or inaction of other service providers to the
Trust, provided such action or inaction of such other service providers to any
Portfolio of the Fund is not a result of the willful misconduct, bad faith or
gross negligence in the performance of, or from reckless disregard of, the
duties of the Subadviser under this Agreement.
11. Indemnifications.
A. The Investment Manager shall indemnify the Subadviser and its
affiliates, officers, directors, employees, agents, legal representatives and
persons controlled by it (which shall not include the Fund or any portfolio)
(collectively, "Subadviser Related Persons") to the fullest extent permitted by
law against any and all loss, damage, judgments, fines, amounts paid in
settlement and reasonable expenses, including attorneys' fees (collectively
"Losses"), incurred by the Subadviser or Subadviser Related Persons arising from
or in connection with this Agreement or the performance by the Subadviser or
Subadviser Related Persons of its or their duties hereunder so long as such
losses arise out of the Investment Manager's gross negligence, willful
misconduct or bad faith, in performing its responsibilities hereunder or under
its agreements with the Fund or the gross negligence, willful misconduct or bad
faith of any service provided to any portfolio of the Fund, including without
limitation, such losses arising under any applicable law or that may be based
upon any untrue statement of a material fact contained in the Fund's
registration statement, or any amendment thereof or any supplement thereto, or
the omission to state therein a material fact known or which should have been
known and was required to be stated therein or necessary to make the statement
therein not misleading, unless such statement or omission was made in reliance
upon written information furnished to the Investment Manager or the Fund by the
Subadviser or any Subadviser Related Person specifically for inclusion in the
registration statement or any amendment or supplement thereto, except to the
extent any such losses referred to in this paragraph A (i.e., paragraph A.)
result from willful misfeasance, bad faith, gross negligence or reckless
disregard on the part of the Subadviser or a Subadviser Related Person in the
performance of any of its duties under, or in connection with, this Agreement.
B. The Subadviser shall indemnify the Investment Manager and its
controlling persons, officers, directors, employees, agents, legal
representatives and persons controlled by it (which shall not include the Fund
or any Portfolio) (collectively, "Investment Manager Related Persons") to the
fullest extent permitted by law against any and all losses incurred by the
Investment Manager or Investment Manager Related Persons arising from or in
connection with this Agreement or the performance by the Investment Manager or
Investment Manager Related Persons of its or their duties hereunder so long as
such losses
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arise out of the Subadviser's gross negligence, willful misconduct or bad faith
in performing it responsibilities hereunder, including, without limitation,
such losses arising under any applicable law or that may be based upon any
untrue statement of a material fact contained in the Fund's registration
statement, or any amendment thereof or any supplement thereto or the omission to
state therein a material fact known or which should have been known and was
required to be stated therein or necessary to make the statement therein not
misleading, provided that such statement or omission was made in reliance upon
written information furnished by the Subadviser or Subadviser Related Person to
the Investment Manager or the Fund, except to the extent any such losses
referred to in this paragraph B (i.e., paragraph B.) result from willful
misfeasance, bad faith, gross negligence or reckless disregard on the part of
the Investment Manager or a Investment Manager Related Person in the performance
of any of its duties under, or in connection with, this Agreement.
C. The indemnifications provided in this Section shall survive the
termination of this Agreement.
12. Reliance on Documents. The Board of Directors of the Fund or its
officers or agent will provide timely information to the SubAdviser regarding
such matters as purchases and redemptions of shares in the Portfolio, the cash
requirements, and cash available for investment in the Portfolio, and all other
information as may be reasonably necessary or appropriate in order for the
SubAdviser to perform its responsibilities hereunder.
Neither the Fund or the Investment Manager, nor their respective
designees or agents, shall use any material describing or identifying the
SubAdviser or its affiliates without the prior consent of the SubAdviser. Any
material utilized by the Fund, the Investment Manager or their respective
designees or agents which contain information as to the SubAdviser and/or its
affiliates shall be submitted to the SubAdviser for approval prior to use, not
less than five (5) business days before such approval is requested.
The Investment Manager has herewith furnished the Subadviser copies of
the Fund's Prospectus, Articles of Incorporation and By-Laws as currently in
effect and agrees during the continuance of the Agreement to furnish the
Subadviser copies of any amendments or supplements thereto before or at the time
the amendments or supplements become effective. The Subadviser will be entitled
to rely on all such documents furnished to it by the Investment Manager of the
Fund.
13. Duration and Termination of the Agreement. This Subadvisory
Agreement shall become effective as of the date first written above and remain
in force until _______________ [date]. Thereafter, it shall continue in effect
from year to year, but only so long as such continuance is specifically approved
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at least annually by (a) the Board of Directors of the Fund, or by the vote of a
majority of the outstanding voting securities of the Portfolio, and (b) a
majority of those directors who are not parties to this Subadviser Agreement,
not interested persons of any party to this Subadviser Agreement, cast in person
at a meeting called for the purpose of voting on such approval. This Agreement
may be terminated, without the payment of any penalty, by the Board of Directors
of the Fund, by a vote of a majority of the outstanding shares of the Portfolio,
or by the Investment Manager on sixty days' written notice to the Subadviser, or
by the Subadviser on sixty days' written notice to the Fund or the Investment
Manager. Termination by the Board of Directors or by the Investment Manager
shall be subject to shareholder approval to the extent legally required. This
Agreement shall automatically terminate in the event of its assignment or in the
event of termination of the Investment Management Agreement.
14. Amendments of the Agreement. Except to the extent permitted by
the Investment Company Act or the rules or regulations thereunder or pursuant to
any exemptive relief granted by the Securities and Exchange Commission ("SEC"),
this Agreement may be amended by the parties only if such amendment, if
material, is specifically approved by the vote of a majority of the outstanding
voting securities of the Portfolio (unless such approval is not required by
Section 15 of the Investment Company Act as interpreted by the SEC or its staff)
and by the vote of a majority of the Independent Directors cast in person at a
meeting called for the purpose of voting on such approval. The required
shareholder approval shall be effective with respect to the Portfolio if a
majority of the outstanding voting securities of the Portfolio vote to approve
the amendment, notwithstanding that amendment may not have been approved by a
majority of the outstanding voting securities of any other portfolio affected by
the amendment or all the portfolios of the Fund.
15. Definitions. The terms "assignment", "interested person", and
"majority of the outstanding voting securities", when used in this Agreement,
shall have the respective meaning specified under the Investment Company Act and
the rules thereunder.
16. Notices. Any notice that is required to be given by the parties
to each other under the terms of this Agreement shall be given in writing,
delivered, or mailed postpaid to the other 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:
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(a) If to the Subadviser:
Warburg, Xxxxxx Counselors, Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxx X. Xxxxx
Facsimile: (000) 000-0000
(b) If to the Investment Manager:
Chubb Investment Advisory Corporation
Xxx Xxxxxxx Xxxxx
Xxxxxxx, XX 00000
Attn: Xxxxxx Xxxxxxxxx
Facsimile (000) 000-0000
17. Governing Law. The provisions of this Agreement shall be
construed and interpreted in accordance with the laws of the State of New
Hampshire as at the time in effect and the applicable provisions of the
Investment Company Act or other federal laws and regulations which may be
applicable. To the extent that the applicable law of the State of New Hampshire
or any of the provisions herein, conflict with the applicable provisions of the
Investment Company Act or other federal laws and regulations which may be
applicable, the latter shall control.
18. Neither the Fund nor the Investment Manager or any affiliate,
designee or agent thereof shall make reference to or use the name, and any
derivative thereof or logo associated with that name, of the Subadviser or any
of its clients or affiliates or use any material describing the Subadviser
without the prior approval of the Subadviser. Upon termination of this
Agreement, the Investment Manager and the Fund shall forthwith cease to use such
name (or derivative or logo) as soon as reasonably practicable.
19. Entire Agreement. This Agreement contains the entire
understanding and agreement of the parties with respect to the Portfolio and the
Fund with respect to the subject matter contained herein
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20. Headings. The headings in the sections of this Agreement are
inserted for convenience of reference only and shall not constitute a part
hereof.
21. Severability. Should any portion of this Agreement for any
reason be held to be void in law or in equity, the Agreement shall be construed,
insofar as is possible, as if such portion had never been contained herein.
CHUBB INVESTMENT ADVISORY CORPORATION
ATTEST: BY:
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TITLE: TITLE:
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SUBADVISER
ATTEST: BY:
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TITLE: TITLE:
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