FORM OF
SUB-ADVISORY AGREEMENT
AGREEMENT made as of the day of , 1999 by and between Xxxxxx
Xxxxxxx Xxxx Xxxxxx Investment Management Inc., a Delaware corporation (herein
referred to as the "Investment Manager"), and Xxxxxx Xxxxxxx Xxxx Xxxxxx
Advisors Inc., a Delaware corporation, (herein referred to as the
"Sub-Advisor").
WHEREAS, Xxxxxx Xxxxxxx Xxxx Xxxxxx Institutional Fund, Inc. (herein
referred to as the "Fund") is engaged in business as an open-end management
investment company and is registered as such under the Investment Company Act of
1940, as amended (the "Act"); and
WHEREAS, the Investment Manager has entered into an Investment Management
Agreement with the Fund (the "Investment Management Agreement") wherein the
Investment Manager has agreed to provide investment management services to the
various portfolios of the Fund; and
WHEREAS, the Sub-Advisor is registered as an investment adviser under the
Investment Advisers Act of 1940, and engages in the business of acting as an
investment adviser; and
WHEREAS, Investment Manager desires to retain the services of the
Sub-Advisor to render investment advisory services for the Money Market
Portfolio and the Municipal Money Market Portfolio of the Fund (each a
"Portfolio" and together the "Portfolios") in the manner and on the terms and
conditions hereinafter set forth; and
WHEREAS, the Sub-Advisor desires to be retained by the Investment Manager to
perform services on said terms and conditions:
NOW, THEREFORE, in consideration of the mutual covenants and agreements of
the parties hereto as herein set forth, the parties covenant and agree as
follows:
1. Subject to the supervision of the Fund, its officers and Directors, and the
Investment Manager, and in accordance with the investment objectives,
policies and restrictions set forth in the then-current Registration
Statement relating to the Fund, and such investment objectives, policies and
restrictions from time to time prescribed by the Directors of the Fund with
respect to the Portfolios and communicated by the Investment Manager to the
Sub-Advisor, the Sub-Advisor agrees to provide the Fund with investment
advisory services with respect to the Portfolios' investments to obtain and
evaluate such information and advice relating to the economy, securities
markets and securities as it deems necessary or useful to discharge its
duties hereunder; to continuously manage the assets of each Portfolio in a
manner consistent with the investment objective and policies of the
applicable Portfolio; to make decisions as to foreign currency matters and
make determinations as to forward foreign exchange contracts and options and
futures contracts in foreign currencies; shall determine the securities to
be purchased, sold or otherwise disposed of by the Fund and the timing of
such purchases, sales and dispositions; to take such further action,
including the placing of purchase and sale orders on behalf of the
Portfolios, as it shall deem necessary or appropriate; to furnish to or
place at the disposal of the Fund and Investment Manager such of the
information, evaluations, analyses and opinions formulated or obtained by it
in the discharge of its duties as the Fund and the Investment Manager may,
from time to time, reasonably request. The Investment Manager and the
Sub-Advisor shall each make its officers and employees available to the
other from time to time at reasonable times to review investment policies of
the Portfolios and to consult with each other.
2. The Sub-Advisor shall, at its own expense, maintain such staff and employ or
retain such personnel and consult with such other persons as it shall from
time to time determine to be necessary or useful to the performance of its
obligations under this Agreement. Without limiting the generality of the
foregoing, the staff and personnel of the Sub-Advisor shall be deemed to
include persons employed or
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otherwise retained by the Sub-Advisor to furnish statistical and other
factual data, advice regarding economic factors and trends, information with
respect to technical and scientific developments, and such other
information, advice and assistance as the Investment Manager may desire. The
Sub-Advisor shall maintain whatever records as may be required to be
maintained by it under the Act. All such records so maintained shall be made
available to the Fund, upon the request of the Investment Manager or the
Fund.
3. The Fund will, from time to time, furnish or otherwise make available to the
Sub-Advisor such financial reports, proxy statements and other information
relating to the business and affairs of the Portfolios as the Sub-Advisor
may reasonably require in order to discharge its duties and obligations
hereunder or to comply with any applicable law and regulations and the
investment objectives, policies and restrictions from time to time
prescribed by the Directors of the Fund.
4. The Sub-Advisor shall bear the cost of rendering the investment advisory
services to be performed by it under this Agreement, and shall, at its own
expense, pay the compensation of the officers and employees, if any, of the
Fund, employed by the Sub-Advisor, and such clerical help and bookkeeping
services as the Sub-Advisor shall reasonably require in performing its
duties hereunder.
5. The Fund assumes and shall pay or cause to be paid all other expenses of the
Fund, including, without limitation: any fees paid to the Investment
Manager; fees pursuant to any plan of distribution that the Fund may adopt;
the charges and expenses of any registrar, any custodian, sub-custodian or
depository appointed by the Fund for the safekeeping of its cash, portfolio
securities and other property, and any stock transfer or dividend agent or
agents appointed by the Fund; brokers' commissions chargeable to the Fund in
connection with portfolio securities transactions to which the Fund is a
party; all taxes, including securities issuance and transfer taxes, and fees
payable by the Fund to federal, state or other governmental agencies or
pursuant to any foreign laws; the cost and expense of engraving or printing
certificates representing shares of the Fund; all costs and expenses in
connection with the registration and maintenance of registration of the Fund
and its shares with the Securities and Exchange Commission and various
states and other jurisdictions or pursuant to any foreign laws (including
filing fees and legal fees and disbursements of counsel); the cost and
expense of printing (including typesetting) and distributing prospectuses of
the Fund and supplements thereto to the Fund's shareholders; all expenses of
shareholders' and Directors' meetings and of preparing, printing and mailing
proxy statements and reports to shareholders; fees and travel expenses of
Directors or members of any advisory board or committee who are not
employees of the Investment Manager or Sub-Advisor; all expenses incident to
the payment of any dividend, distribution, withdrawal or redemption whether
in shares or in cash; charges and expenses of any outside service used for
pricing of the Fund's shares; charges and expenses of legal counsel,
including counsel to the Directors of the Fund who are not interested
persons (as defined in the Act) of the Fund, the Investment Manager or the
Sub-Advisor, and of independent accountants, in connection with any matter
relating to the Fund; membership dues of industry associations; interest
payable on Fund borrowings; postage; insurance premiums on property or
personnel (including officers and Directors) of the Fund which inure to its
benefit; extraordinary expenses (including but not limited to legal claims
and liabilities and litigation costs and any indemnification related
thereto); and all other charges and costs of the Fund's operation unless
otherwise explicitly provided herein.
6. For the services to be rendered, the facilities furnished, and the expenses
assumed by the Sub-Advisor, the Investment Manager shall pay to the
Sub-Advisor monthly compensation equal to 40% of the fee that the Investment
Manager receives from each Portfolio pursuant to the Investment Management
Agreement. Any subsequent change in the Investment Management Agreement
which has the effect of raising or lowering the compensation of the
Investment Manager will have the concomitant effect of raising or lowering
the fee payable to the Sub-Advisor under this Agreement. In addition, if the
Investment Manager has undertaken in the Fund's Registration Statement as
filed under the Act (the "Registration Statement") or elsewhere to waive all
or part of its fee under the Investment
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Management Agreement, the Sub-Advisor's fee payable under this Agreement
will be proportionately waived in whole or in part. The calculation of the
fee payable to the Sub-Advisor pursuant to this Agreement will be made, each
month, at the time designated for the monthly calculation of the fee payable
to the Investment Manager pursuant to the Investment Management Agreement.
If this Agreement becomes effective subsequent to the first day of a month
or shall terminate before the last day of a month, compensation for the part
of the month this Agreement is in effect shall be prorated in a manner
consistent with the calculation of the fee as set forth above.
7. The Sub-Advisor will use its best efforts in the performance of investment
activities on behalf of the Fund, but in the absence of willful misfeasance,
bad faith, gross negligence or reckless disregard of its obligations
hereunder, the Sub-Advisor shall not be liable to the Investment Manager or
the Fund or any of its investors for any error of judgment or mistake of law
or for any act or omission by the Sub-Advisor or for any losses sustained by
the Fund or its investors.
8. It is understood that any of the shareholders, Directors, officers and
employees of the Fund may be a shareholder, director, officer or employee
of, or be otherwise interested in, the Sub-Advisor, and in any person
controlled by or under common control with the Sub-Advisor, and that the
Sub-Advisor and any person controlled by or under common control with the
Sub-Advisor may have an interest in the Fund. It is also understood that the
Sub-Advisor and any affiliated persons thereof or any persons controlled by
or under common control with the Sub-Advisor have and may have advisory,
management service or other contracts with other organizations and persons,
and may have other interests and businesses, and further may purchase, sell
or trade any securities or commodities for their own accounts or for the
account of others for whom they may be acting.
9. This Agreement shall remain in effect with respect to each Portfolio until
, 2001 and from year to year thereafter provided such continuance is
approved at least annually by the vote of holders of a majority, as defined
in the Act, of the outstanding voting securities of the applicable Portfolio
or by the Directors of the Fund, provided, that in either event such
continuance is also approved annually by the vote of a majority of the
Directors of the Fund who are not parties to this Agreement or "interested
persons" (as defined in the Act) of any such party, which vote must be cast
in person at a meeting called for the purpose of voting on such approval;
provided, however, that (a) the Fund may, at any time and without the
payment of any penalty, terminate this Agreement with respect to either
Portfolio or both Portfolios upon thirty days' written notice to the
Investment Manager and the Sub-Advisor, either by majority vote of the
Directors of the Fund or by the vote of a majority of the outstanding voting
securities of the applicable Portfolio(s); (b) this Agreement shall
immediately terminate in the event of its assignment (within the meaning of
the Act) unless such automatic termination shall be prevented by an
exemptive order of the Securities and Exchange Commission; (c) this
Agreement shall immediately terminate in the event of the termination of the
Investment Management Agreement; (d) the Investment Manager may terminate
this Agreement with respect to either Portfolio or both Portfolios without
payment of penalty on thirty days' written notice to the Fund and the
Sub-Advisor; and (e) the Sub-Advisor may terminate this Agreement with
respect to either Portfolio or both Portfolios without the payment of
penalty on thirty days' written notice to the Fund and the Investment
Manager. Any notice under this Agreement shall be given in writing,
addressed and delivered, or mailed post-paid, to the other party at the
principal office of such party.
10. This Agreement may be amended by the parties without the vote or consent of
the shareholders of the Portfolios to supply any omission, to cure, correct
or supplement any ambiguous, defective or inconsistent provision hereof, or
if they deem it necessary to conform this Agreement to the requirements of
applicable federal laws or regulations, but neither the Fund, the Investment
Manager nor the Sub-Advisor shall be liable for failing to do so.
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11. This Agreement shall be construed in accordance with the law of the State of
New York and the applicable provisions of the Act. To the extent the
applicable law of the State of New York, or any of the provisions herein,
conflict with the applicable provisions of the Act, the latter shall
control.
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement on the day and year first above written in New York, New York.
XXXXXX XXXXXXX XXXX XXXXXX
INVESTMENT MANAGEMENT INC.
By:
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Attest:
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XXXXXX XXXXXXX XXXX XXXXXX
ADVISORS INC.
By:
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Attest:
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Accepted and agreed to as of
the day and year first above written:
XXXXXX XXXXXXX XXXX XXXXXX
INSTITUTIONAL FUND, INC.
By:
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Attest:
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