SUBADVISORY AGREEMENT
SUBADVISORY AGREEMENT, dated December 5, 2003 between J. & X. XXXXXXXX & CO.
INCORPORATED, a Delaware corporation (the "Manager") and WELLINGTON MANAGEMENT
COMPANY, LLP., a Massachusetts limited liability partnership
(the "Subadviser"). WHEREAS, the Manager has entered into a Management
Agreement, dated as of the date hereof (the "Management Agreement"), with
Xxxxxxxx Global Fund Series, Inc. (the "Corporation"), an open-end management
investment company registered under the Investment Company Act of 1940, as
amended (the "1940 Act"), to render or contract to obtain assistance in
rendering investment management services to the Corporation, and to administer
the business and other affairs of the Corporation; and WHEREAS, the Manager
desires to retain the Subadviser to assist in providing investment advisory and
other services to the Corporation's Xxxxxxxx Emerging Markets Fund, Xxxxxxxx
Global Growth Fund, Xxxxxxxx Global Smaller Companies Fund and Xxxxxxxx
International Growth Fund (the "Subadvised Funds"), and the Subadviser is
willing to render such services, effective as of the date first written above
(the "Effective Date"). NOW, THEREFORE, in consideration of the mutual covenants
contained herein, the parties hereto agree as follows:
1. Duties of the Subadviser. (a) Subject in each case to the control of the
Board of Directors of the Corporation (the "Board") and in accordance with the
objectives, policies and principles set forth in the Registration Statement and
Prospectus(es) of the Subadvised Funds (the "Registration Statement") and the
requirements of the 1940 Act, and in conjunction with and under the supervision
of the Manager, the Subadviser agrees to furnish the Manager and the Corporation
with such investment advice, research and assistance as the Manager or the
Corporation shall from time to time reasonably request. Without limiting the
generality of the foregoing, Subadviser shall manage the investments of each
Subadvised Fund in accordance with the Registration Statement and in compliance
with the requirements applicable to registered investment companies under
applicable laws and those requirements applicable to regulated investment
companies under Subchapter M of the Internal Revenue Code of 1986, as amended
("Code"), and such other limitations as the Manager or the Board may institute
and inform the Subadviser in writing are applicable.
(b) Subject to the foregoing, the Subadviser shall (i) participate in the
development of each Subadvised Fund's overall investment strategy and in the
determination of investment allocations, (ii) provide investment advice and
research to each Subadvised Fund with respect to existing and potential
investments in securities, including company visits and meetings with
management, (iii) determine securities and other assets for investment, (iv)
select brokers and dealers, (v) cause the execution of trades, including foreign
exchange dealings and (vi) unless otherwise agreed to by the Manager, vote
proxies solicited by or with respect to issuers of securities in which assets of
the Subadvised Funds may be invested from time to time. In providing these
services, the Subadviser will conduct a continual program of investment,
evaluation and, if appropriate, sale and reinvestment of each Subadvised Fund's
assets. The Subadviser will make available representatives to report in person
to the Board at least semi-annually on investment results, regulatory compliance
with respect to each Subadvised Fund's investments and other matters that the
Manager or the Board may reasonably request. The Subadviser shall also provide
such reports and other information to the Manager or the Board as such persons
may reasonably request.
(c) The Subadviser agrees to provide, subject to any obligations or undertakings
by the Manager reasonably necessary to maintain the confidentiality of the
Subadviser's non-public information, any and all information, records and
supporting documentation about the composite of accounts and the funds the
Subadviser manages that have investment objectives, policies, and strategies
substantially similar to those employed by the Subadviser in managing the
Subadvised Funds which may be reasonably necessary, under applicable laws, to
allow the Corporation or its agent to present historical performance information
concerning the Subadviser's substantially similarly managed accounts and funds,
for inclusion in the Corporation's Prospectus(es) and any other reports and
materials prepared by the Corporation or its agent, in accordance with
regulatory requirements or as requested by applicable federal or state
regulatory authorities.
(d) Portfolio accounting and pricing for the Subadvised Funds will be the
ultimate responsibility of a third party accounting agent or administrator;
however, in the event that an asset under the supervision of the Subadviser
cannot be priced by a pricing source authorized by the Manager or market
quotations are not readily available (as contemplated in the Fund's valuation
procedures), the Subadviser will provide the third party accounting agent or
administrator with a recommended "fair value" for such asset in accordance with
the Fund's valuation procedures. Notwithstanding the foregoing, the Subadviser
will be responsible for coordinating work with custodians in respect of assets
under the Subadviser's supervision ("Custodians"), including liaising as
required with Custodians in respect of trade settlement, safe custody of assets,
income collection and the processing of corporate actions. The Subadviser will
inform the Manager of material changes in the custody risks associated with the
Subadvised Funds' depository arrangements in a foreign country, based on the
analysis of risk and other information provided by the foreign custody manager
of each Subadvised Fund. With respect to the securities of issuers under the
supervision of the Subadviser, the Subadviser shall provide executed trade
information to Custodians, third party accounting agents or administrators
and/or the Manager (or its designee), which may be done via computer.
(e) The Subadviser agrees to keep, and to preserve for the prescribed periods,
all records relating to its activities hereunder that are required by the 1940
Act and the Investment Advisers Act of 1940, as amended (the "Advisers Act").
The Subadviser hereby agrees that any and all records which it maintains for
each Subadvised Fund are the property of the Corporation and further agrees to
surrender promptly to the Corporation copies of any of such records upon the
Corporation's or the Manager's request, provided, however, that Subadviser may
retain copies of any records. Nothing herein shall prohibit the Subadviser from
using the performance track record of the Subadvised Funds, including following
any termination of this Agreement, to the extent such use is otherwise
consistent with applicable law, rules and regulations.
(f) With respect to any investment company in the Xxxxxxxx Group of Funds, (i)
the Subadviser will not consult with any other subadviser to that investment
company (including, in the case of an offering of securities subject to Section
10(f) of the 1940 Act, any subadviser that is a principal underwriter or an
affiliated person of a principal underwriter of such offering) concerning
transactions for that investment company in securities or other assets, except,
in the case of transactions involving securities of persons engaged in
securities-related businesses, for purposes of complying with the conditions of
paragraphs (a) and (b) of Rule 12d3-1 under the 1940 Act; and (ii) if the
Subadviser and any other subadviser are providing investment advice to that
investment company, the investment advice provided by Subadviser to that
investment company will be limited to the assets for which Subadviser is
responsible. The Manager shall provide a current list of all subadvisers to the
Xxxxxxxx Group of Funds to the Subadviser and shall update such list promptly
upon any additions or departures of subadvisers to the Xxxxxxxx Group of Funds.
(g) The Subadviser shall exercise its best judgment in rendering its services
described in this Agreement. However, subject to Section 36 of the 1940 Act, the
Subadviser shall not be liable to the Corporation 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 its duties under this Agreement 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 under
this Agreement; provided, however, that the Subadviser shall be liable for any
loss incurred by the Corporation, a Subadvised Fund, the Manager or their
respective affiliates to the extent such losses arise out of any act or omission
directly attributable to the Subadviser which results, directly or indirectly,
in a material error in the net asset value of a Subadvised Fund.
2. Expenses. The Subadviser shall pay all of its expenses arising from the
performance of its obligations hereunder, other than the cost of securities
including brokerage commissions and similar fees and charges for the
acquisition, disposition, lending or borrowing of each Subadvised Fund's
investments.
3. Compensation. (a) As compensation for the services performed by the
Subadviser pursuant to Section 1, the Manager will pay to the Subadviser each
month a fee calculated on each day during such month as indicated on the
attached Fee Schedule. Such compensation shall be paid by the Manager to the
Subadviser as soon as practicable following receipt by the Manager of its
investment management fees from the Corporation (but no later than 10 business
days following such receipt). (b) If the Subadviser shall serve hereunder for
less than the whole of any month, the fee hereunder shall be prorated. (c) Any
fee payable to the Subadviser under this Agreement shall be paid to the
Subadviser or to an affiliate of the Subadviser at an address or to an account
designated by the Subadviser.
4. Purchase and Sale of Assets. (a) The Subadviser shall purchase securities and
other assets from or through and sell securities or other assets to or through
such persons, brokers or dealers as the Subadviser shall deem appropriate in
order to carry out the policy with respect to allocation of portfolio
transactions as set forth in the Registration Statement and Prospectus(es) of
the Subadvised Funds and as the Board may direct from time to time. In providing
the Subadvised Funds with investment management and supervision, it is
recognized that the Subadviser will seek best execution and, consistent with
such policy, may give consideration to the research, statistical and other
services furnished by brokers or dealers to the Subadviser for its use, to the
general attitude of brokers or dealers toward investment companies and their
support of them, and to such other considerations as the Board may direct or
authorize from time to time. Notwithstanding the above, it is understood that it
may be desirable for the Subadvised Funds that the Subadviser have access to
supplemental investment and market research and security and economic analysis
provided by brokers who execute brokerage transactions at a higher cost to the
Subadvised Funds than may result when allocating brokerage to other brokers.
Therefore, the Subadviser is authorized to place orders for the purchase and
sale of securities of the Subadvised Funds with such brokers, subject to review
by the Board from time to time with respect to the extent and continuation of
this practice. It is understood that the services provided by such brokers may
be useful to the Subadviser in connection with its services to other clients as
well as the Subadvised Funds.
(b) Subadviser will not be responsible for any act or omission
by brokers and dealers selected by the Subadviser in accordance
with Section 1(g) of this Agreement, provided that such brokers
or dealers were selected with reasonable care. (c) Subadviser
may, to the extent permitted by applicable laws and regulations,
but shall be under no obligation to, aggregate securities to be
sold or purchased on behalf of the Subadvised Funds with those
of other clients. 5. Subadviser's Representations. Subadviser
represents, warrants and covenants to Corporation and the
Manager that:
(a) It is duly formed, validly existing and in good standing under the laws of
the Commonwealth of Massachusetts and has full power and authority to enter into
and perform its obligations under this Agreement;
(b) It has duly authorized, executed and delivered this Agreement and intends
that it shall constitute a valid and binding agreement enforceable in accordance
with its terms, except to the extent limited by the principles of equity and
public policy;
(c) It is registered as an investment adviser under the Advisers Act;
(d) Its entry into, and performance of any duties or actions under, this
Agreement shall at all times be in accordance with all applicable laws and
regulations;
(e) It shall deliver to the Corporation and the Manager (i) a copy of
Subadviser's Form ADV, Part II (or similar disclosure document) and each
material update thereof, (ii) Subadviser's proxy voting policies and each update
thereof, (iii) Subadviser's Code of Ethics, including any code adopted under
Rule 17j-1 of the 1940 Act, and each update thereof and (iv) such other
information (e.g., disclosures, policies, violations of Code of Ethics or other
materials) as reasonably requested by the Manager or the Board to the extent
such information is required to be delivered or made available under the 1940
Act or Advisers Act or rules and regulations promulgated thereunder or in
connection therewith;
(f) Its Form ADV and each investment performance composite and accompanying
disclosures provided by the Subadviser to the Manager or the Board include all
material information that is required to be stated therein or necessary to make
the statements therein not misleading;
(g) It shall not execute trades with broker-dealers who are "affiliated persons"
(within the meaning of the 0000 Xxx) of the Subadviser, without the prior
approval of the Manager and, to the extent necessary to comply with the 1940
Act, the Board, provided that the Manager shall notify the Subadviser in writing
of all broker-dealers who are "affiliated persons" of a Subadvised Fund other
than broker-dealers that are "affiliated persons" of a Subadvised Fund based
solely of the ownership or control of such broker-dealer by the Subadviser;
(h) It shall notify the Manager of any change in the membership of its
partnership within a reasonable time after such change;
(i) It has adopted procedures reasonable necessary to prevent "access persons"
(within the meaning of Rule 17j-1) from violating its Code of Ethics; and
(j) It will promptly notify the Manager in writing in the event that any of the
foregoing ceases to be true.
6. Manager's Representations. Manager represents, warrants and covenants to
Subadviser that:
(a) It is duly formed, validly existing and in good standing under the laws of
the State of Delaware and has full power and authority to enter into and perform
its obligations under this Agreement;
(b) It has duly authorized, executed and delivered this Agreement and intends
that it shall constitute a valid and binding agreement enforceable in accordance
with its terms, except to the extent limited by the principles of equity and
public policy;
(c) It is registered as an investment adviser under the Advisers Act;
(d) Its entry into, and performance of any duties or actions under, this
Agreement shall at all times be in accordance with all applicable laws and
regulations;
(e) Assuming the accuracy of the representations, warranties and covenants of
the Subadviser contained herein and the due performance of the Subadviser of its
obligations hereunder, the Fund's Registration Statement, to Manager's best
knowledge, is in compliance in all material respects with applicable federal and
state laws and regulations. (f) It will promptly notify the Subadviser in
writing in the event that any of the foregoing ceases to be true.
7. Service to Other Clients. The services of the Subadviser are
not to be deemed exclusive to the Corporation, it being understood that the
Subadviser may perform investment advisory services for various other clients,
and it is acknowledged that the Subadviser may give advice and take action with
respect to any of its other clients which may differ or be contrary to, advice
given, or from timing or nature of actions taken, with respect to the assets of
a Subadvised Fund. To the extent permitted by applicable law, Subadviser may
purchase, or recommend for purchase, for a Subadvised Fund securities owned by
the Subadviser, its partners or affiliates, securities of companies for which an
affiliate or Subadviser acts as financial adviser or performs other investment
banking services, or securities of companies where partners or employees of
Subadviser, or its affiliates, serve on the board of directors. 8. Delivery of
Documents and Notice of Events. The Manager agrees to promptly furnish the
Subadviser with the Management Agreement, the Corporation's Articles of
Incorporation and Bylaws, the Subadvised Funds' Registration Statement,
prospectus(es) and Statement of Additional Information, proxy statements,
reports to shareholders, any policies properly Board authorized affecting
management and any other items reasonably requested by the Subadviser. The
Manager further agrees to promptly provide the Subadviser with copies of all
amendments of or supplements to all of the foregoing. 9. Indemnification. (a)
Subadviser agrees to hold harmless and indemnify the Manager from and against
any loss or damages arising out of Subadviser's breach of this Agreement or
arising out of the willful misfeasance, bad faith or gross negligence on
Subadviser's part in the performance of its duties, or from reckless disregard
of its obligations and duties, under this Agreement.
(b) The Manager agrees to hold harmless and indemnify Subadviser from and
against any loss or damages arising out of the Manager's breach of this
Agreement or arising out of the willful misfeasance, bad faith or gross
negligence on the Manager's part in the performance of its duties, or from
reckless disregard of its obligations and duties, under this Agreement.
10. Cooperation and Provision of Certain Information. The Subadviser shall
promptly notify the Manager (1) in the event the SEC or other governmental
authority has censured the Subadviser; placed limitations upon its activities,
functions or operations; suspended or revoked its registration, if any, as an
investment adviser; or has commenced proceedings or an investigation that may
result in any of these actions or (2) upon having a reasonable basis for
believing that a Subadvised Fund has ceased to qualify or might not qualify as a
regulated investment company under Subchapter M of the Code. The Manager shall
promptly notify the Subadviser (1) in the event the SEC or other governmental
authority has censured the Manager; placed limitations upon its activities,
functions or operations; suspended or revoked its registration, if any, as an
investment adviser; or has commenced proceedings or an investigation that may
result in any of these actions or (2) upon having a reasonable basis for
believing that a Subadvised Fund has ceased to qualify or might not qualify as a
regulated investment company under Subchapter M of the Code. The Subadviser
further agrees to notify the Manager promptly of any material fact known to the
Subadviser respecting or relating to the Subadviser that is not contained in a
Prospectus for a Subadvised Fund, and is required to be stated therein or
necessary to make the statements therein not misleading, or of any statement
relating to Subadviser contained therein that becomes untrue in any material
respect. As reasonably requested by the Manager or the Board and in accordance
with the scope of Subadviser's obligations and responsibilities contained in
this Agreement, Subadviser will cooperate with, and provide assistance to, the
Manager or the Corporation as needed in order for the Manager and the
Corporation to comply with applicable laws, rules and regulations, including,
but not limited to, compliance with the Xxxxxxxx-Xxxxx Act and the rules and
regulations promulgated by the SEC thereunder.
11. Use of Names. The Subadviser shall not use the name, logo, insignia, or
other identifying xxxx of the Corporation, the Subadvised Funds or the Manager
or any of their affiliates or any derivative or logo or trade or service xxxx
thereof, or disclose information related to the business of the Manager or any
of its affiliates in material relating to the Subadviser in any manner not
approved prior thereto by the Manager; provided, however, that the Manager shall
approve all uses of its or the Corporation's name and the Subadvised Funds'
names and that of their affiliates which merely refer in accurate terms to the
appointment of the Subadviser hereunder or which are required by the SEC or a
state securities commission; and provided, further, that in no event shall such
approval be unreasonably withheld. The Manager shall not use the name, logo,
insignia, or other identifying xxxx of the Subadviser or any of its affiliates
in any prospectus, sales literature or other material relating to the
Corporation in any manner not approved prior thereto by the Subadviser;
provided, however, that the Subadviser shall approve all uses of its name which
merely refer in accurate terms to the appointment of the Subadviser hereunder or
which are required by the SEC or a state securities commission; and provided,
further that in no event shall such approval be unreasonably withheld. 12.
Notices. Any notice required or permitted hereunder shall, unless expressly
permitted otherwise hereunder, be in writing and shall be given by personal
service, mail, or facsimile to the other party as set forth below. Notice shall
be effective upon receipt if by mail, on the date of personal delivery (by
private messenger, courier service or otherwise), or upon receipt of telex or
facsimile, whichever occurs first.
Notice to the Manager shall be to:
J. & X. Xxxxxxxx & Co. Incorporated 000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: President
Notice to the Subadviser shall be to:
Wellington Management Company, LLP
00 Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attn: Legal Services_________
Notice to the Corporation shall be to:
Seligman Global Fund Series, Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Secretary
A party may change its notice address at any time by written communication to
the other parties.
13. Term of Agreement. This Agreement shall become effective on the Effective
Date and shall continue in full force and effect until December 31, 2004, and
from year to year thereafter if such continuance is approved in the manner
required by the 1940 Act. This Agreement may be terminated at any time, with
respect to a Subadvised Fund, without payment of penalty, by the Corporation on
60 days' written notice to the Subadviser by vote of the Board or by vote of a
majority of the outstanding voting securities (as defined by the 0000 Xxx) of
the applicable Subadvised Fund. After December 31, 2006 (the "Commitment Date"),
this Agreement also may be terminated, with respect to a Subadvised Fund, by the
Subadviser or the Manager as of the end of any calendar year upon not less than
60 days' written notice to the other and to the Corporation. This Agreement will
automatically terminate, with respect to a Subadvised Fund, in the event of its
assignment (within the meaning of the 0000 Xxx) with respect to that Subadvised
Fund or upon the termination of the Management Agreement with respect to that
Subadvised Fund. In the event that this Agreement terminates, with respect to a
Subadvised Fund, before the Commitment Date as a result of an assignment of this
Agreement or termination of the Management Agreement, with respect to that
Subadvised Fund, Subadviser agrees that, if requested by the Board and the
Manager, Subadviser shall make its advisory services available to that
Subadvised Fund and the Manager on terms no less favorable to the Corporation
and the Manager than provided herein. Notwithstanding the foregoing, the
Subadviser may terminate this Agreement prior to the Commitment Date or
thereafter, for cause, on 60 days' written notice to the Corporation and the
Manager. 14. Amendments. This Agreement may be amended by consent of the parties
hereto provided that the consent of the Fund is obtained in accordance with the
requirements of the 1940 Act.
15. Miscellaneous. (a) Entire Agreement. This Agreement shall constitute the
entire agreement between the parties with respect to the subject matter hereof
and shall supersede any and all prior agreements and understandings, whether
written or verbal.
(b) Governing Law. This Agreement shall be construed and interpreted under
the laws of the State of New York applicable to contracts executed and performed
entirely in the State of New York. Anything herein to the contrary
notwithstanding, this Agreement shall not be construed to require, or to impose
any duty upon, either of the parties to do anything in violation of any
applicable laws or regulations.
(c) Waiver. Failure of a party to insist upon strict adherence to any term of
this Agreement on any occasion shall not be considered to be a waiver or deprive
that party of the right thereafter to insist upon strict adherence to that term
or any other term of this Agreement. (d) Enforceability. If any provision of
this Agreement is invalid or unenforceable, the balance of the Agreement shall
remain in effect, and if any provision is inapplicable to any person or
circumstance, it shall nevertheless remain applicable to all other persons and
circumstances.
(e) Counterparts. This Agreement may be executed in one or more counterparts,
each of which taken together shall constitute one and the same instrument.
(f) Headings. The section and paragraph headings contained in this Agreement are
for reference only and shall not affect in any way the meaning or interpretation
of this Agreement. IN WITNESS WHEREOF, the Manager and the Subadviser have
caused this Agreement to be executed by their duly authorized officers as of the
date first above written.
J. & X. XXXXXXXX & CO. INCORPORATED By
Name:
Title:
WELLINGTON MANAGEMENT COMPANY, LLP.
By
Name:
Title:
FEE SCHEDULE
SUBADVISED FUND ANNUAL RATE
(as a percentage of average daily net assets)
Xxxxxxxx Emerging Markets Fund 0.65% of net assets
Xxxxxxxx Global Growth Fund 0.45% of net assets up to $50 million
0.40% of net assets over $50 million
Xxxxxxxx Global Smaller Companies Fund 0.75% of net assets up to $100 million
0.65% of net assets over $100 million
Xxxxxxxx International Growth Fund 0.45% of net assets up to $50 million
0.40% of net assets over $50 million
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